O’Loughlin cuts $6 million deal for Chesterfield Doubletree

Friday, September 2, 2011


Bob O'Loughlin - LHM revenue to reach $150 million this year

Angela Mueller
Reporter - St. Louis Business Journal


Lodging Hospitality Management is adding the 18th local hotel to its portfolio with the acquisition of the Doubletree Hotel and Conference Center in Chesterfield.

LHM is investing about $15 million in the hotel, including $9 million for renovations, according to Chairman and Chief Executive Bob O'Loughlin. LHM is buying the hotel from San Antonio-based USAA Real Estate Co. The transaction was set to close Sept. 1, with the Bank of Washington providing financing.

Executives from Hilton Hotels & Resorts, which owns the Doubletree name, knew USAA was looking for a buyer for the Chesterfield property and connected the company with O'Loughlin. LHM operates several local Hilton hotels, including the Hilton Garden Inn in Chesterfield and Hilton at the Ballpark downtown. With this acquisition, LHM will own all three of the metro area's Doubletree hotels, including the facilities in Westport and Collinsville.

The 223-room Chesterfield Doubletree sits on 23 acres on Swingley Ridge Road and features 36,000 square feet of meeting space and a 91,000-square-foot athletic facility.

"The location of the hotel and the fitness center and conference center made it attractive to us," O'Loughlin said.

LHM plans to renovate the lobby, ballroom, conference center, restaurants and all guest rooms. The renovation, which LHM will handle internally, is slated to be completed by next spring.

LHM is expecting to reach $150 million in revenue this year for all its hotels, up about 5 percent from 2010. "Revenue growth is mostly in occupancy, not in average rate," O'Loughlin said.

Across St. Louis, hotel occupancy is up 3.8 percent this year, according to Brian Hall, chief marketing officer for the St. Louis Convention & Visitors Commission. The average room rate is up 1.8 percent, and revenue per available room is up 5.7 percent.

LHM recently finished an $11 million renovation of the 108 rooms at the Cheshire Inn in Richmond Heights, which the company bought from the Apted family for $4 million in December. Occupancy at the hotel has hovered around 60 percent since its mid-August reopening, O'Loughlin said.

LHM is preparing to start work in October on a $10 million renovation of the restaurant at the Cheshire, which O'Loughlin hopes to complete by spring.

Earlier this summer, LHM premiered the Three Sixty rooftop bar at the downtown Hilton St. Louis at the Ballpark. LHM invested $7 million in the rooftop bar, which O'Loughlin said has been doing "extremely well" since its July opening. LHM bought the Hilton at the Ballpark, formerly a Marriott, in 2005 and spent $30 million to renovate it.

O'Loughlin said the company will continue to look for additional hotels to add to its portfolio."It's a good time to buy," he said. "Because of the recession, a lot of people are deciding to sell right now."

More than $24 billion in hotel real estate changed hands globally in 2010, according to research from Jones Lang LaSalle Hotels. Global transactions are expected to reach close to $30 billion this year.

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