Baltimore, MD – Alex. Brown Realty (ABR) and Modus Hotels are pleased to announce the acquisition of the Normandy Hotel, a 75-room boutique hotel in Washington, D.C. ABR Chesapeake Fund IV, a value-added real estate fund sponsored by ABR, invested in the venture.
The Normandy Hotel is located in the Kalorama neighborhood of Washington, D.C., within the heart of the foreign embassy corridor and walking distance to Dupont Circle. Built in 1969 as an apartment project, the property was converted to a boutique hotel in 1981. The building is six stories in height with an underground parking garage.
The hotel completed a $6 million renovation in 2009 that included updates to the common areas, guestrooms and bathrooms as well as the purchase of new case goods. “The hotel is in excellent physical condition after the renovations,” said Tom Burton, ABR’s chief investment officer. “We do not anticipate any major capital needs, nor will we have to invest in extensive soft goods replacement, which is often typical with a hotel purchase,” noted Burton.
With the acquisition, Modus will operate seven boutique hotels in the metro D.C. area. “We continue to have a strong appetite for properties in destination marketplaces with high barriers to entry where we feel we can add value through superior management,” said Katz. Katz further noted that he anticipates both ADR and RevPAR will improve once Modus fully implements its marketing and revenue management strategies.
The Normandy Hotel is the first joint venture between ABR and Modus. “Given our attractive basis in the hotel and Modus’ experienced management team, the hotel should be able to achieve strong operating margins, which bodes well for our investors,” commented Burton.
Alex. Brown Realty (ABR) is a privately owned real estate investment manager organized in 1972 and headquartered in Baltimore, Maryland. ABR co-invests with joint venture partners in a broad spectrum of property types located throughout the United States. www.abrealty.com
Modus Hotels has successfully owned and operated hotels since 1976 under the name Potomac Hospitality Services. In 2010, the company changed its name to Modus to reflect its evolution in the lifestyle segment. Modus is a full service hotel development and management company and is an affiliate of Cafritz Interests, a diversified real estate company with properties in the hotel, office, residential and industrial real estate sectors. For more information, please visit http://modushotels.com