A partnership owned by Host Hotels & Resorts Inc. (HST)
plans to sell at least $300 million in 20-year debentures
exchangeable into Host Hotels stock and/or cash.
Shares were down 6% premarket at $10.30. The stock, which hit a
16-year low in March, was up 45% in 2009 through Monday.
The lodging real-estate investment trust, like many in the hotel
sector, has been hurt by a prolonged travel and tourism downturn.
Its strong balance sheet and $1 billion cash cushion have raised
curiosity in what acquisitions it may pursue.
Host Hotels & Resorts LP will use the sale's proceeds to pay
down debt, including $346 million of notes due in 2012. Many
companies have been selling stock and/or debt this year to
refinance or pay off near-term borrowings.
Host Hotels in October reported its third consecutive quarterly
loss amid the slump in room demand. Its funds from operations
dropped but still beat analysts' estimates, while it improved some
of its forecasts for the rest of the year.
-By Joan E. Solsman, Dow Jones Newswires; 212-416-2291;
joan.solsman@dowjones.com