SoTHERLY Hotels has acquired the 326-room Georgian Terrace Hotel in Atlanta's Midtwon business district, along with an adjacent 698-space parking structure, for $61 million. The hotel will be managed by Chesapeake Hospitality.
As a part of the transaction, the company closed on a $41.5-million loan with Bank of the Ozarks collateralized by a first mortgage on the property. The loan carries a floating interest rate of the 3-month LIBOR rate plus 3.75 percent with a 4-percent interest rate floor and amortizes on a 25-year schedule following a 12-month interest only period.
Also as part of the transaction, the company closed on a $19-million loan with Richmond Hill Partners, LP and Essex Equity Joint Investment Vehicle, LLC.
Drew Sims, CEO of SoTHERLY, commented, “The Georgian Terrace Hotel is a significant acquisition for SoTHERLY Hotels. This iconic hotel gives us a landmark property in the second largest MSA in the Southern United States. Atlanta also serves as a primary feeder market to our existing hotel portfolio and therefore it has been a high priority for us. We are pleased to not only enter this market but to acquire a property of this caliber. We believe there is tremendous upside to both the market and the hotel.”
The historic Georgian Terrace Hotel, nicknamed the “Grand Dame of Atlanta”, was built in 1911. A new demand generator will be Emory University’s $225- million Proton Cancer Therapy Center being constructed adjacent to the hotel and is set to open in late 2015.
The hotel guestrooms average more than 800 square feet each, which SoTHERLY said is the largest in the market, and more than 16,000 square feet of flexible meeting space, and three food and beverage outlets.
Since 2009, over $15 million has been invested in renovations.
For year-end 2013, the Hotel operated at approximately 72-percent occupancy, with an average daily rate of approximately $135.85 and revenue per available room of approximately $97.44.