In a joint venture, Carey Watermark Investors has acquired the Ritz-Carlton Philadelphia and plans to launch a $21.3 million renovation of the property this year.
The hotel will continue to be managed by Marriott affiliate the Ritz-Carlton Hotel Company.
“The joint venture investment in the Ritz-Carlton Philadelphia allowed us to add a high quality landmark hotel to the Carey Watermark Investors portfolio,” says Michael Medzigian, president and CEO of Carey Watermark Investors. “We are excited about the opportunity to recapitalize on an exceptional asset in order to fund an extensive renovation and position the property competitively within the luxury sector of the market. The acquisition of an institutional-grade, luxury hotel in an established city center location, in combination with the strength of the Ritz-Carlton brand, represents a unique and attractive opportunity as we continue to build out our portfolio.”
The acquisition was influenced by Philadelphia’s well-diversified economic base and more than $4.7 billion in current local developments, such as the 2011 expansion of the Pennsylvania Convention Center and expansions at the University of Pennsylvania and the Jefferson Health System. Last year, PKF Hospitality Research noted that hotel occupancy in the Center City district hit 76 percent, which was the highest annual occupancy since 1949.
All 299 rooms will receive new casegoods and bathroom upgrades in addition to extensive renovations to the lobby, meeting space, ballroom, corridors, club lounge, and F&B outlets. An agreement with a third-party F&B operator to head the hotel’s newly renovated and re-conceptualized restaurant and lounge is underway.
The renovation is slated for completion in 2016.
The historic property is located in Philadelphia’s central business district and was originally opened in 1908 as the Girard Trust Company. McKim Mead and White designed the hotel’s rotunda and adjacent eight-story tower, though the tower was not added until 1923. In 1931, the building was expanded from eight to 30 stories and converted to the Ritz-Carlton in 2000. The property is within walking distance of City Hall and the recently completed $50 million Dilworth Plaza fountain and skating rink.
The property features 26,000 square feet of meeting and banquet space, which includes a 6,100-square-foot grand ballroom; the Richel D’Ambra Spa & Salon; a fitness center; business center; and two F&B outlets.
