The property was purchased for $71 million, or approximately $239,000 a key, by an affiliate of Lowe Enterprises Investors (LEI).
Red Lion Hotels Corporation (NYSE: RLH) announced that it closed the previously announced sale of the Red Lion Hotel on Fifth Avenue in Seattle, WA. The property was purchased for $71 million, or approximately $239,000 a key, by an affiliate of Lowe Enterprises Investors (LEI).
At closing, LEI entered into a franchise agreement with Red Lion Hotels Franchising, Inc. to continue to operate the property as a Red Lion hotel, managed by LEI affiliate, Destination Hotels & Resorts. The company also entered into an affiliation agreement with a subsidiary of Destination Hotels & Resorts to facilitate the cross-promotion of hotels between the companies.
"This transaction is very positive for Red Lion. It allows the Red Lion brand to continue on a flagship hotel in downtown Seattle and allows us to deploy the hotel's equity to recapitalize our balance sheet and reinvest in our hotels and brand," said Jon E. Eliassen, President and Chief Executive Officer of Red Lion Hotels Corporation. "We know that the Red Lion Hotel Fifth Avenue will continue to provide the highest level of service to our guests under the management of Destination Hotels & Resorts."
"The ability to add guest rooms and to expand the available meeting space creates the opportunity to increase revenue. Meeting space, such as we plan, which will be designed with the most modern technologies, high-end finishes and flexible configuration, will attract the abundant corporate meeting business that already exists in the market. And given the hotel's recent high quality renovations and its attractive location, the Red Lion will have a competitive advantage over other existing nearby options," said Charlie Peck, president of Destination Hotels & Resorts. "The Red Lion name carries with it a long tradition as a great brand in downtown Seattle."
The 297-room property is centrally located in downtown Seattle, just a few blocks from Pike Place Market and the Washington State Convention Center. Red Lion Hotels Corporation announced in January 2011 it was listing the hotel for sale. Chris Burdett of CBRE Hotels in Seattle represented Red Lion in the sale.
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