Park Hotels & Resorts to Sell Two Assets for $149M
The company has entered into a contract to sell a 210-room San Diego hotel and a 204-room Washington DC hotel, for a sales price that equates to $360,000 per key.
SAN DIEGO, CA – Park Hotels & Resorts Inc. has entered into an definitive agreement to sell two hospitality assets for combined proceeds of $149 million.
The properties consist of the 210-room Hotel Indigo San Diego Gaslamp Quarter in San Diego, CA and the 204-room Courtyard Washington Capitol Hill Navy Yard in Washington DC.
The sales price of the hotels equates to $360,000 per room.
The two assets were originally acquired by the Virginia-based company in September 2019 as part of Park Hotels & Resorts’ acquisition by merger of Chesapeake Lodging Trust.
When adjusted for Park Hotels & Resorts’ anticipated capital expenditures, the sale price represents a 7% capitalization rate on 2019 net operating income or 12.8x 2019 EBITDA.
The proceeds of the sale will be used to repay debt.
The transaction is currently expected to close within the next 45 to 60 days.
“The sale of these two hotels represents our on-going commitment to reduce net leverage and better position our portfolio for long-term, sustainable growth,” says Thomas J. Baltimore Jr., chairman and CEO of Park Hotels & Resorts. “Year to date, we have announced a total of $173 million of asset sales and are confident about achieving our targeted goal of $300 million to $400 million of asset sales in 2021.”