BETHESDA, Md.—RLJ Lodging Trust announced that it acquired the historic Humble Oil Building complex in downtown Houston, for a purchase price of $79.5 million, or approximately $151,000 per key.
The Humble Oil Building is a three-tower complex that occupies an entire city block in downtown Houston. The complex consists of an 82-unit apartment tower that will be converted to a 166-room SpringHill Suites and two existing hotels— the 191-room Courtyard Houston Downtown Convention Center and the 171-room Residence Inn Houston Downtown Convention Center.
“Our ability to execute this off-market transaction required the expertise, experience, and relationships that are unique to RLJ,” commented Thomas J. Baltimore, Jr., president and chief executive officer. “Acquiring the Humble Oil Building complex represents a value-add opportunity. Both existing hotels have notable upside potential and our extensive experience managing complex renovations will enable us to deliver another conversion property that will help drive economies of scale.”
An estimated $70.0-million renovation of the premises was completed in 2003 that restored several historical features and converted the complex into its present use of two hotels and one apartment tower. RLJ Lodging Trust will leverage its in-house capabilities to convert the existing apartment tower into a high-quality, institutional-grade hotel. The conversion is expected to be completed in mid-2015 and will enable the company to capitalize on design, brand, and operational efficiencies. The Courtyard and the Residence Inn underwent 6-year Marriott “Refresh” renovations in 2010 and 2011, respectively.