DALLAS, Feb. 29,
2024 /PRNewswire/ -- Ashford Hospitality Trust, Inc.
(NYSE: AHT) ("Ashford Trust" or the "Company") today announced that
it has signed a definitive agreement to sell the 390-room Hilton
Boston Back Bay (the "Hotel") in Boston,
Massachusetts for $171 million
($438,000 per key). The sale is
expected to be completed in March, and is subject to normal closing
conditions. The Company provides no assurances that the sale
will be completed on these terms or at all.
For the trailing twelve months ended December 31, 2023, the Hotel's net income was
$2.3 million, its net operating
income was $14.9 million, and its
Hotel EBITDA was $16.7 million.
When adjusted for the Company's anticipated capital expenditures,
the sale price represents a 7.3% capitalization rate on 2023 net
operating income, or 12.3x 2023 Hotel EBITDA. Excluding the
anticipated capital spend, the sale price represents an 8.7%
capitalization rate on 2023 net operating income, or 10.2x 2023
Hotel EBITDA. The Company expects the net proceeds to be
approximately $70 million after
repayment of the underlying mortgage debt and closing costs.
The Company expects to use the net proceeds for general corporate
purposes including the paydown of its strategic financing.
"We are pleased to announce the planned sale of the Hilton
Boston Back Bay for a very attractive value," commented
Rob Hays, Ashford Trust's President
and Chief Executive Officer. "This sale is an early step toward the
recently announced plan to pay off our strategic financing.
We continue to have several assets in the market at various stages
of the sales process and look forward to providing more updates in
the coming weeks."
* * * * *
Ashford Hospitality Trust is a real estate investment trust
(REIT) focused on investing predominantly in upper upscale,
full-service hotels.
Ashford Hospitality
Trust, Inc.
|
Hilton Boston Back
Bay
|
Reconciliation of
Hotel Net Income to Hotel EBITDA and Hotel Net Operating
Income
|
(Unaudited, in
millions)
|
|
|
|
|
|
12 Months
Ending
|
|
|
December 31,
2023
|
Net income
(loss)
|
|
$
2.3
|
Interest
expense
|
|
8.9
|
Amortization of loan
costs
|
|
0.5
|
Depreciation and
amortization
|
|
4.7
|
Non-hotel EBITDA
ownership expense
|
|
0.3
|
Hotel EBITDA
|
|
$
16.7
|
Capital
reserve
|
|
(1.8)
|
Hotel Net Operating
Income
|
|
$
14.9
|
_________________
|
All information in this
table is based upon unaudited operating financial data for the
twelve month
period ended December 31, 2023. This data has not been audited or
reviewed by the Company's
independent registered public accounting firm. The financial
information presented could change.
|
|
EBITDA is defined as
net income (loss), computed in accordance with generally accepted
accounting
principles, before interest, taxes, depreciation and amortization.
Hotel EBITDA multiple is defined as
the purchase price divided by the trailing 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 of 4%
of gross revenues.
|
Forward-Looking Statements
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 Company's strategy and future plans, including its plans
to raise capital through a combination of asset sales, mortgage
debt refinancings and non-traded preferred capital raising and to
pay off its strategic financing. 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," "could," "plan," or similar
expressions, we intend to identify forward-looking statements. Such
statements are subject to numerous assumptions and uncertainties,
many of which are outside of Ashford Trust'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: our ability to complete the sale of Hilton Boston Back
Bay on the terms currently anticipated or at all; our ability to
raise sufficient capital to pay off our strategic debt; our ability
to repay, refinance, or restructure our debt and the debt of
certain of our subsidiaries; anticipated or expected purchases or
sales of assets; our projected operating results; completion of any
pending transactions; our understanding of our competition; market
trends; projected capital expenditures; the impact of technology on
our operations and business; general volatility of the capital
markets and the market price of our common stock and preferred
stock; availability, terms and deployment of capital; availability
of qualified personnel; changes in our industry and the markets 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 Trust's filings with the
Securities and Exchange Commission.
The forward-looking statements included in this press release
are made only as of the date of this press release. Such
forward-looking statements are based on our beliefs, assumptions,
and expectations of our future performance taking into account all
information currently known to us. These beliefs, assumptions, and
expectations can change as a result of many potential events or
factors, not all of which are known to us. If a change occurs, our
business, financial condition, liquidity, results of operations,
plans, and other objectives may vary materially from those
expressed in our forward-looking statements. You should carefully
consider these risks when you make an investment decision
concerning our securities. Investors should not place undue
reliance on these forward-looking statements. The Company can give
no assurance that these forward-looking statements will be attained
or that any deviation will not occur. 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, except to the extent
required by law.
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SOURCE Ashford Hospitality Trust, Inc.