http://citymarketato.blogspot.com/2011/09/hotel-announcement.html
Here is an update on the O Street Market hotel thanks to the Shaw Neighborhood Yahoo Group.
O Street Market hotel update
Bates Area Civic Association
Washington, DC, between North Capitol St NW/New Jersey Ave NW & Florida Ave NW/P St NW
Bates Area Civic Association 
Here is the Washington Business Journal article from last week on this hotel-at-CityMarket-at-O project news:
Some more details on CityMarket hotel
Date: Thursday, September 22, 2011, 11:07am EDThttp://www.bizjournals.com/washington/blog/2011/09/some-more-details-on-citymarket-hotel.html