Carey Watermark Investors Incorporated (CWI 1), a public, non-traded real estate investment trust (REIT), announced today that it has acquired a majority interest in the Ritz-Carlton Philadelphia (The Ritz) via a joint venture (JV) with Philadelphia Hospitality Partners, L.P., the owner of the 299-room hotel.
The JV plans a $21.3 million renovation to begin during the third quarter 2015 lasting into Q2 2016 that will include a full replacement of each room’s soft and case goods, bathroom upgrades, plus enhancements to the lobby, meeting space, club lounge, and food & beverage outlets, among other areas.
“The joint venture investment in The Ritz-Carlton Philadelphia allowed us to add a high quality landmark hotel to the Carey Watermark Investors portfolio. We are excited about the opportunity to recapitalize an exceptional asset in order to fund an extensive renovation and position the property competitively within the luxury sector of the market,” commented Michael Medzigian, President & Chief Executive Officer of Carey Watermark Investors in a statement.
Originally built beginning in 1904 and completed in 1908, the eight-story building served The Girard Trust Company. In 1931, an expansion increased its height to 30 stories and in 2000, the property was converted to The Ritz-Carlton.
Located in the central business district of Philadelphia, the hotel sits next to City Hall and within walking distance of fine dining, upscale shopping, and the Dilworth Plaza fountain and skating rink.
“The acquisition of an institutional-grade, luxury hotel in an established city-center location, in combination with the strength of The Ritz-Carlton brand, represents a unique and attractive opportunity as we continue to build out our portfolio,” added Medzigian.
CWI I raised $575.8 million through its initial public offering and $577.4 million in its follow-on offering which closed December 31, 2014. The REIT, with capital to deploy, intends to invest remaining proceeds in lodging and lodging related properties.