DALLAS, May 11, 2017 /PRNewswire/ -- Ashford
Hospitality Prime, Inc. (NYSE: AHP) ("Ashford Prime" or the "Company") announced today
that it has completed the acquisition of the 80-room Hotel
Yountville in Yountville,
California for $96.5 million
($1,200,000 per key), previously
announced on March 1, 2017.
Concurrent with the completion of the acquisition, the Company has
financed the hotel with a $51.0
million non-recourse mortgage loan. This loan is
interest only and provides for a floating interest rate of LIBOR +
2.55% with a five-year term. The property will be
managed by Remington Lodging.
The purchase price for the Hotel Yountville represents, as of
December 31, 2016, a trailing
12-month capitalization rate of 6.2% on hotel net operating income
of $6.0 million and a trailing
12-month 14.5x hotel EBITDA multiple, according to the Company's
preliminary estimates based on unaudited operating financial data
provided by the sellers. On a forward 12-month basis, the
purchase price represents an estimated capitalization rate of 6.8%
on estimated hotel net operating income of $6.5 million and an estimated 13.4x hotel EBITDA
multiple, according to the Company's preliminary estimates based on
unaudited operating financial data provided by the sellers. A
reconciliation of non-GAAP financial measures is included in the
financial table below.
Ashford Hospitality Prime is a real estate investment trust
(REIT) focused on investing in luxury hotels and resorts.
Ashford has created an Ashford App for the hospitality REIT
investor community. The Ashford App is available for free
download at Apple's App Store and
the Google Play Store by searching "Ashford."
Certain statements and assumptions in this press release
contain or are based upon "forward-looking" information and are
being made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. Forward-looking
statements in this press release include, among others, statements
about the future performance and ability of the Hotel Yountville to
meet financial projections. These forward-looking statements
are subject to risks and uncertainties. When we use the words
"will likely result," "may," "anticipate," "estimate," "should,"
"expect," "believe," "intend," or similar expressions, we intend to
identify forward-looking statements. Such statements are
subject to numerous assumptions and uncertainties, many of which
are outside Ashford Prime's control.
These forward-looking statements are subject to known and unknown
risks and uncertainties, which could cause actual results to differ
materially from those anticipated, including, without
limitation: general volatility of the capital markets and the
market price of our common stock; changes in our business or
investment strategy; availability, terms and deployment of capital;
availability of qualified personnel; changes in our industry and
the market in which we operate, interest rates or the general
economy; our ability to successfully complete and integrate
acquisitions, and manage our planned growth, and the degree and
nature of our competition. These and other risk factors are
more fully discussed in Ashford
Prime's filings with the Securities and Exchange
Commission. The forward-looking statements included in this
press release are only made as of the date of this press
release. Investors should not place undue reliance on these
forward-looking statements. We are not obligated to publicly
update or revise any forward-looking statements, whether as a
result of new information, future events or circumstances, changes
in expectations or otherwise.
Ashford
Hospitality Prime
|
Hotel
Yountville
|
Reconciliation of
Estimated Hotel Net Income to Estimated Hotel EBITDA and Estimated
Hotel Net
Operating Income
|
(Unaudited, in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
Estimated
|
|
|
|
Twelve
Months
|
|
Twelve
Months
|
|
|
|
Ended December
31,
|
|
Ending December
31,
|
|
|
|
2016
|
|
2017
|
Hotel Net
Income
|
|
$
|
4.3
|
|
$
|
3.8
|
|
|
|
|
|
|
Adjustment:
|
|
|
|
|
|
Depreciation and
amortization
|
|
$
|
2.3
|
|
$
|
2.3
|
|
Interest
expense
|
|
$
|
-
|
|
$
|
1.1
|
|
|
|
|
|
|
Hotel
EBITDA
|
|
$
|
6.7
|
|
$
|
7.2
|
|
|
|
|
|
|
Adjustment:
|
|
|
|
|
|
Capital
reserve
|
|
$
|
(0.6)
|
|
$
|
(0.7)
|
|
|
|
|
|
|
|
|
|
|
|
|
Hotel Net Operating
Income
|
|
$
|
6.0
|
|
$
|
6.5
|
|
|
|
|
|
|
|
|
|
EBITDA is defined
as net income (loss), computed in accordance with generally
accepted accounting principles ("GAAP"), before interest, taxes,
depreciation and amortization. Hotel EBITDA multiple is
defined as the purchase price divided by the estimated trailing or
forward 12 month EBITDA. A capitalization rate is determined
by dividing the property's annual net operating income by the
purchase price. Net operating income is the property's hotel
EBITDA minus a capital expense reserve
|
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SOURCE Ashford Hospitality Prime, Inc.