Haberhill, LLC, along with its partners, purchased the 220 room Embassy Suites Hotel on June 1, 2007 from Hilton Hotels Corporation. Haberhill, who put the transaction together and negotiated the terms and conditions of both the purchase agreement and the long-term management contract with Hilton, serves as the operating partner and asset manager. The hotel is owned respectively by affiliates of Brickman Associates, high net worth individuals and Haberhill LLC. Senior and mezzanine financing was provided by Lehman Brothers Bank. The senior loan was securitized and the mezzanine loan is currently held by Capital Trust.
The Embassy Suites central location in the affluent East Memphis submarket has historically enabled the hotel to achieve consistent cash flow and continual RevPAR growth since 2003. It has also been the RevPAR leader in its competitive set for more than five years and has achieved this strong long term performance primarily due to consistently strong weekday and weekend demand with minimal seasonality.
As part of the purchase from Hilton, we committed to finish a full suite renovation program, totaling $5.5 million. The renovation was completed during the first quarter of 2008.
We have returned approximately 125% of our partners’ original capital. A sale of the hotel is planned in 2013.