Ashford Hospitality Trust, Inc. announced it has entered into a definitive agreement to sell a five-hotel, 1,396-room portfolio of select-service hotels for $142 million in cash to Noble Investment Group.
The portfolio is comprised of the 146-room Courtyard Edison in Edison, N.J.; the 150-room Residence Inn Buckhead in Atlanta; and the 312-room Courtyard Lake Buena Vista, 388-room Fairfield Inn Lake Buena Vista and 400-room Springhill Suites Lake Buena Vista in Orlando. The three Orlando properties are managed by Marriott and the other two properties are managed by Remington Lodging.
The purchase price, including projected capex to be invested by Noble, represents a trailing 12-month cap rate of 8.0% on net operating income. On a trailing 12-month basis, the portfolio achieved RevPAR of $84, with occupancy of 79% and Average Daily Rate of $106.
The portfolio has an existing debt balance of approximately $98 million, and Ashford expects the net proceeds from the disposition to be approximately $37 million after debt repayment and transaction costs. It intends to use the net proceeds from the sale for general corporate purposes.
The transaction is scheduled to close in the second quarter, subject to certain closing conditions.
"We are pleased to announce this sale as it provides a positive first step in our announced strategy of divesting of our non-core, select-service assets," said Monty J. Bennett, Ashford Trust's chairman and CEO. "We will continue to pursue the sale of these hotels with a focus on maximizing value.”
Ashford Hospitality Trust is a real estate investment trust (REIT) focused on investing opportunistically in the hospitality industry in upper upscale, full-service hotels.
