CHICAGO — Sunstone Hotel Investors Inc. (NYSE: SHO), a California-based lodging REIT, has sold two hotels in Chicago for a combined gross sales price of $129.5 million. The properties include the 368-room Embassy Suites Chicago and the 361-room Hilton Garden Inn Chicago Downtown/Magnificent Mile. Buyer information was not provided.
The sale marks Sunstone’s exit from the Chicago market, which has been hindered by excess supply and an inability to drive meaningful rate and profitability growth, says CEO Bryan Giglia. For the month of February, Chicago’s hotel occupancy rate of 43.8 percent was the second-lowest rate across the nation, according to hospitality data firm STR. The average occupancy rate nationally for the month was 56.9 percent. Sunstone’s stock price opened at $11.69 per share Tuesday, March 22, down slightly from $12.82 per share one year ago.