Ashford Hospitality Trust to Recycle Capital With Sale of Eight Residence Inns for $102 Million
November 28 2005 - 8:30AM
PR Newswire (US)
Highlights: DALLAS, Nov. 28 /PRNewswire-FirstCall/ -- Ashford
Hospitality Trust, Inc. (NYSE:AHT) today announced it has placed
eight non-core hotels under contract for sale to Schuylkill, LLC
for a total sales price of $102 million. The sale price includes
$93.7 million of existing financing that will be assumed by the
buyer. The closing is subject to standard conditions and is
expected to take place in the next 60 days. Molinaro Koger brokered
the transaction for Ashford. The hotels, which are all Generation
One Residence Inns, were acquired by Ashford in June 2005 as part
of the 30-hotel portfolio acquired from CNL Hotels and Resorts. The
Residence Inns are located in Fishkill, NY; Ft. Worth, TX; Orlando,
FL; Tyler, TX; Ann Arbor, MI; Providence, RI; Sacramento, CA; and
Wilmington, DE. Collectively, the properties are being sold at an
8.9% net operating income capitalization rate on trailing 12-month
net operating income and on a 9.5x EBITDA multiple. The hotels had
been designated as non-core properties along with nine other
hotels. The remaining 15 core hotels from the original 30 hotels
purchased currently produce a trailing 12-month net operating
income return of 9.2% based upon their original allocated purchase
price. Monty J. Bennett, President and Chief Executive Officer of
Ashford, commented, "The sale of these 8 non-core hotels
demonstrates our proactive approach to recycling capital. Our
strategy to sell these hotels combined with the favorable financing
we arranged enhances the returns on the remaining higher quality
assets. We intend to remain a recycler of capital rather than a
property aggregator. In doing so, we expect to better match
potential sources and uses of capital to achieve dividend and CAD
growth as well as increased shareholder returns." Ashford
Hospitality Trust is a self-administered real estate investment
trust focused on investing in the hospitality industry across all
segments and at all levels of the capital structure, including
direct hotel investments, first mortgages, mezzanine loans and
sale-leaseback transactions. Additional information can be found on
the Company's web site at http://www.ahtreit.com/. 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. 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 forward-looking
statements include, but are not limited to, the impact of the
transaction on our business and future financial condition, our
business and investment strategy, our understanding of our
competition and current market trends and opportunities and
projected capital expenditures. Such statements are subject to
numerous assumptions and uncertainties, many of which are outside
Ashford'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; and the degree and nature of our competition. These and
other risk factors are more fully discussed in Ashford's filings
with the Securities and Exchange Commission. EBITDA is defined as
net income before interest, taxes, depreciation and amortization.
Net operating income is the property's funds from operations minus
a capital expense reserve of 4% of gross revenues. Funds from
operations ("FFO"), as defined by the White Paper on FFO approved
by the Board of Governors of the National Association of Real
Estate Investment Trusts ("NAREIT") in April 2002, represents net
income (loss) computed in accordance with generally accepted
accounting principles ("GAAP"), excluding gains (or losses) from
sales or properties and extraordinary items as defined by GAAP,
plus depreciation and amortization of real estate assets, and net
of adjustments for the portion of these items related to
unconsolidated entities and joint ventures. 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. Contact:
Douglas Kessler COO and Head of Acquisitions (972) 490-9600 or
Tripp Sullivan Corporate Communications, Inc. (615) 254-3376
DATASOURCE: Ashford Hospitality Trust, Inc. CONTACT: Douglas
Kessler, COO and Head of Acquisitions of Ashford Hospitality Trust,
Inc., +1-972-490-9600; or Tripp Sullivan of Corporate
Communications, Inc., +1-615-254-3376 Web site:
http://www.ahtreit.com/
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