Hersha Hospitality Trust Announces Commitment for $225 Million Senior Secured Credit Facility
October 05 2010 - 4:01PM
Business Wire
Hersha Hospitality Trust (NYSE: HT), owner of select service and
upscale hotels in major metropolitan markets, today announced that
it has signed a commitment letter with TD Bank, N.A. and TD
Securities (USA) LLC for a proposed $225 million senior secured
revolving credit facility, which would replace Hersha’s current
$135 million senior secured credit facility. TD Bank will serve as
the sole administrative agent and TD Securities (USA) LLC will
serve as lead arranger and book manager.
The proposed $225 million senior secured revolving credit
facility matures in three years with an extension option for an
additional year and may be upsized to $250 million. Borrowings will
bear interest at a rate determined by a leverage-based pricing
grid. LIBOR loans will bear interest at LIBOR plus an applicable
margin of either 350 or 375 basis points per year, subject to a
LIBOR floor of 75 basis points per year. Hersha expects that other
terms, conditions and covenants of the new credit facility will be
generally consistent with the terms of its existing credit
facility.
“We appreciate the support of TD Bank, TD Securities and the
banking syndicate involved in the facility. We believe the ability
to materially increase our financial flexibility with this
increased revolving credit facility is testament to the progress we
have made over the years to position our portfolio in some of the
strongest lodging markets in the country and to the increased cash
flow our hotels are able to generate,” commented Jay H. Shah,
Hersha’s Chief Executive Officer. “This secured line of credit will
help us continue to execute on our strategy of acquiring
high-quality hotel properties in key urban gateway markets, which
in our experience have historically led economic recoveries.”
The Company expects to close on the revolving credit facility
during the fourth quarter of 2010, subject to satisfaction of
customary closing conditions and the negotiation and execution of
definitive loan documents.
About Hersha Hospitality Trust
Hersha Hospitality Trust is a self-advised real estate
investment trust, which owns interests in 76 hotels, totaling
10,071 rooms, primarily along the Northeast Corridor from Boston to
Washington D.C. Hersha also owns hotels in Northern California and
Scottsdale, Arizona. Hersha focuses on upscale, mid-scale and
extended stay hotels in major metropolitan markets.
Forward Looking Statement
Certain matters within this press release are discussed using
“forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995, and, as such, may involve
known and unknown risks, uncertainties and other factors that may
cause the actual results or performance to differ from those
projected in the forward-looking statement. For a description of
these factors, please review the information under the heading
“Risk Factors” in Hersha Hospitality Trust’s filings with the SEC,
including its Annual Report on Form 10-K for the year ended
December 31, 2009.
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