PHILADELPHIA-Hersha Hospitality Trust has signed a definitive agreement to sell 16 of its non-core hotel properties to an affiliate of New York City-based Blackstone Real Estate Advisors for $217 million.

The deal, which translates to about $125,000 per key, will mark the REIT's exit from Long Island and suburban Philadelphia hotel markets.

“The anticipated sale of these non-core portfolio hotels completes our transformation into a pure play, urban transient portfolio with exposure to some of the highest demand gateway markets in the United States,” states Jay H. Shah, CEO of Philadelphia-based Hersha Hospitality.

“Including the anticipated sale of these 16 non-core hotels, we have sold 46 non-strategic hotels generating approximately $460 million in gross proceeds since 2008," says Shah. "We expect to redeploy the cash proceeds from this sale into higher growth opportunities in Miami and the West Coast.”

The company plans to repay  $79 million of outstanding debt with part of the proceeds and take $138 million in cash. Hersha anticipates recording a book gain of approximately $30 million on the sale of the assets and projects a trailing 12-month capitalization rate of about 8%.  

The transaction is expected to close by the end of first quarter 2014. Hersha owns 48 hotels with a total of 7,755 rooms in New York, Boston, Philadelphia, Washington, DC, Miami and certain markets on the West Coast.