ANNAPOLIS—Chesapeake Lodging Trust has refinanced two hotels with a $90 million 10-year loan with a fixed rate of 4.3% from Goldman Sachs Mortgage Co. The hotels are the 122-room Holiday Inn New York City Midtown at 31st Street and the 185-room Hyatt Place New York Midtown South. The previous loan was for $60 million. The new loan requires interest-only payments for the first two years and principal and interest payments after that, based on a 30-year principal amortization. The REIT used the proceeds from the refinancing to repay its revolving credit facility.
During the REIT's last earnings call, at the end of April, CFO and Treasurer Doug Vicari described the care the company had been taking with its balance sheet: it ended the quarter with $34.7 million of cash and total assets of $1.57 billion, including $1.46 billion of real estate assets. The long-term debt was $564.2 million and shareholder equity was $932.2 million.
"We are pleased with the progress we have made on our balance sheet since our IPO," he said during the call, describing the strategy as one of matching assets with opportunities in the longer-term debt markets.
Another objective of the REIT is a low leverage ratio, and at quarter's end it had an average cost of debt of 4.2%.
© 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.
