Apr. 23, 2003 - CNL Hospitality Properties Inc., a fast growing Orlando-based hotel real estate trust, is targeting more acquisitions in the Northeast as a result of a multimillion-dollar deal announced Tuesday. 

The trust has invested $10 million and committed up to $15 million more in Hersha Hospitality LP to buy hotels in states such as New York, Connecticut, Massachusetts and New Jersey, the companies said Tuesday. 

CNL will own a majority limited partnership interest in the joint venture. Hersha, which is based in Harrisburg, Pa., and already owns 18 hotels in the Northeast, will be the general partner. 

The joint-venture properties are expected to be branded with names in the Hilton, Marriott and Six Continents families of brands, company representatives said. 

Total capitalization of the partnership, including debt, is expected to be about $150 million. In addition to the private placement investment in Hersha, CNL said it would pump up to $40 million more into the joint venture with the limited partnership. 

The investments are convertible to common stock in Hersha Hospitality Trust, which is operated by the limited partner, at $6.75 a share. 

CNL Hospitality, which bought its first hotel in 1998, now owns 60 properties in 23 states and has inked even larger deals in recent months. 

Earlier this year a partnership that CNL formed in 2002 with Hilton Hotels Corp. bought five hotels for $249 million, ranging from New York to California. In December, when the Hilton-CNL partnership was launched, it bought two hotels, in Dallas and Tucson, Ariz., for $121 million. 

Thomas J. Hutchison III, co-chief executive of CNL Hospitality, said the investment in Hersha, which specializes in midpriced hotels, "aligns with our diversification strategy." CNL Hospitality is a subsidiary of Orlando-based CNL Financial Group Inc., a real estate investment and finance group that controls $5.5 billion in assets in 49 states. 

-----To see more of The Orlando Sentinel -- including its homes, jobs, cars and other classified listings -- or to subscribe to the newspaper, go to http://www.OrlandoSentinel.com 

(c) 2003. Distributed by Knight Ridder/Tribune Business News. HLT,