Kimpton raises $200 million hotel acquisition war chest

US: Kimpton Group Holding LLC, the parent company of Kimpton Hotel & Restaurant Group, has closed its fourth institutional real estate fund, raising $203 million.

KHP Fund III will be used to acquire more than $500 million in hotel real estate over the next three years.

Kimpton says it is “the only branded hotel company with institutionally backed, fully discretionary, dedicated real estate investment funds for the acquisition and development of boutique hotels”.

The company’s first institutional fund, the $122 million Kimpton Development Opportunity Fund (“KDOF”), was established in 1997 and acquired or developed nine properties. The three subsequent KHP Funds (the first of which closed in 2005) have been raised to acquire, develop and redevelop boutique/lifestyle hotel properties “in select major metropolitan cities and resort areas across North America”.

Kimpton CEO Mike Depatie said: “Raising capital for real estate investment has been more challenging than ever over the past few years, which is why we are especially proud to announce the close of this new fund. The discretionary nature of our fund provides us a distinct advantage in acquiring properties because we are able to offer sellers and developers a quick and certain close, something that few others can match.”

“Over the past eight years, we have built a solid track record with the KHP funds, acquiring excellent assets that meet our investment goals, while continuing to build and expand the Kimpton brand as well,” added Depatie.

KHP Fund III has already acquired a property in Savannah Georgia – The Mulberry Inn, a 145-room hotel in downtown Savannah, located in an historic site that once housed a livery stable, a cotton warehouse and later a Coca-Cola bottling plant. The property was converted into a hotel in 1982. The Mulberry Inn is owned in a joint venture between KHP Fund II and KHP Fund III, and will undergo a major renovation in the latter half of 2013 to convert into a Kimpton hotel.

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