BETHESDA, MD-Locally-based hotel REIT Host Hotels and Resorts has priced a private placement offering of $300 million. The senior note offering, due in 2021, is expected to close this week.
The REIT plans to use the proceeds, of approximately $295 million, to pay down some of its debt. Namely, it plans to repurchase or repay $421 million in exchangeable senior debentures due 2027. The REIT did not return a call to GlobeSt.com in time for publication.
Like many REITs in this current environment, Host appears to be carefully balancing a strategy of select acquisitions against capital raising and balance sheet deleveraging.
The REIT, which owns a number of assets in the area including the Gaithersburg Marriott Washingtonian Center in Maryland, has made a handful of acquisitions this year, after a number of deals in 2010. Transactions in 2011 included the fee simple interest in the 775-room New York Helmsley Hotel for $313.5 million and the 1,625-room Manchester Grand Hyatt San Diego, for $570 million. In September, its European joint venture's second fund completed the acquisition of the 396-room Pullman Bercy in Paris.
The REIT has also used proceeds from an issuance of $500 million in senior notes in the second quarter to repurchase approximately $105 million in exchangeable senior debentures for $106 million. It closed the quarter with approximately $524 million in cash and $481 million of available capacity under its credit facility.
© Touchpoint Markets, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more inforrmation visit Asset & Logo Licensing.
Erika Morphy
Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.
