DALLAS, March 9, 2015 /PRNewswire/ -- Ashford
Hospitality Trust, Inc. (NYSE: AHT) ("Ashford Trust" or the
"Company") announced today that it has successfully completed the
previously-announced acquisition of the remaining 28.26% ownership
interest of the Highland Hospitality portfolio from its joint
venture partner, a value-add fund managed by Prudential Real Estate
Investors. The purchase price of $250.1 million was paid in cash and funded by the
concurrent refinancing of 24 hotels in the portfolio as well as
proceeds from the Company's recent equity offering.
The 28-hotel Highland Hospitality portfolio includes 19
full-service hotels and 9 select-service hotels with a
concentration in major brands such as Hilton, Marriott, Hyatt and
Starwood. The total transaction value was $1.735 billion ($215,000 per key). On a forward 12-month
basis, the purchase price represents an expected cap rate of 7.4%
on net operating income and an expected 11.6x EBITDA
multiple.
In connection with the transaction, the Company has successfully
refinanced 24 of the 28 hotels in the Highland portfolio with a new
$1.07 billion non-recourse mortgage
loan. The new financing has a two-year initial term with
four, one-year extension options, subject to the satisfaction of
certain conditions. The loan is interest only and provides
for a floating interest rate of LIBOR + 4.39%, with no LIBOR
floor. It replaces financing with a balance of approximately
$908 million which resulted in net
proceeds of approximately $200
million after closing costs and reserves including the
return to the Company of approximately $80
million of reserves held by the previous lender.
"This transaction represents substantial strategic value for us
in several respects. Since acquiring a majority interest in
the Highland Portfolio almost 4 years ago, these high-quality
assets have significantly exceeded our original expectations. Going
forward, we continue to see further upside potential in this
portfolio given the value-creating initiatives we have implemented
as well as the favorable conditions that persist in the lodging
industry," said Monty J. Bennett,
Ashford Trust's Chairman and Chief Executive Officer. "At the same
time, we were able to take advantage of the favorable debt markets
to complete a refinancing of the majority of assets in the
portfolio on attractive terms. This acquisition and
concurrent financing is another example of our team's continued
ability to find ways to unlock value within our portfolio."
Ashford Hospitality Trust is a real estate investment trust
(REIT) focused on investing opportunistically in the hospitality
industry across all segments and at all levels of the capital
structure primarily within the United States.
Follow Chairman and CEO Monty
Bennett on Twitter at
www.twitter.com/MBennettAshford or @MBennettAshford.
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. 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 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: 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 Trust'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.
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SOURCE Ashford Hospitality Trust, Inc.; Ashford Inc.