Lodging Capital Partners and Lubert-Adler Team Up On Embassy Suites Memphis Acquisition

By Eliza Theiss, Associate Editor

Real estate investment banking firm RobertDouglas announced it has advised Chicago-based Lodging Capital Partners LLC and Philadelphia-based Lubert-Adler Management Co. on the $22.6 million acquisition financing of the 220-key Embassy Suites Memphis.

Financing was provided by a national life insurance company, identified by The Memphis Daily News as Great American Life Insurance Co. According to the same source the final sale price was $24.8 million.

PropertyShark.com’s assessment puts the property’s market value in 2013, including land value, at $18,657,900. The real estate website’s data also shows that its previous owner, Twenty Two Shady Grove LLC, purchased the 1989-built asset for $18.9 million in June 2007. The LLC is an affiliate of Potomac, Maryland-based Haberhill LLC. According to Haberhill’s website, the company picked up Embassy Suites Memphis from Hilton Hotels Corp. and jointly owned it with affiliates of Brickman Associates with a 125 percent return on its partner’s original capital.

Located at 1022 Shady Grove Road, in the East Memphis submarket, the 172,019-square-foot hotel sits on a 3.99-acre lot. Its location in the affluent Germantown/Poplar area has enabled the hotel to boast consistent cash flow and uninterrupted RevPAR growth over the past decade, becoming one of the strongest performing hotels in Memphis.

The property features amenities such as 4,000 square feet of meeting space, including a 3,000-square-foot hall,  indoor swimming pool and whirlpool, fitness center, business center, gift shop, complimentary shuttle service and famous  onsite restaurant Frank Grisanti’s.

Lodging Capital Partners and Lubert-Adler Management are planning a multi-million dollar property renovation, due to which RobertDouglas arranged  “a hybrid execution that provides interest-only flexibility during the renovation period while preserving attractive fixed-rate pricing through the term of the loan on a non-recourse basis,” according to Chris Ropko, one of RobertDouglas’ Los Angeles office directors.  Embassy Suites Memphis most recently underwent a renovation process after its 2007 sale. The $5.5 million process completed in the first quarter of 2008.

Embassy Suites Memphis is Lodging Capital Partners’ first Tennessee and Greater Memphis Area acquisition.

Photo courtesy of Embassy Suites Memphis via Facebook