ALEXANDRIA, VA—LaSalle Hotel Properties announced it has entered into a definitive contract to sell the Hilton Alexandria Old Town for approximately $93 million. In January we reported that a source told us that the REIT was selling this property to Walton Street Capital for $93 million. Neither party confirmed the transaction then.
LaSalle will use the proceeds from the sale of the 246-key hotel to reduce borrowings on its senior unsecured credit facility. Indeed, this has been a goal of the REIT for some time; in its most recent earnings call it noted that it reduced total net debt by $139 million, compared with a year ago. In addition, favorable pricing on debt and lower debt levels resulted in a decrease in net interest expense from $7.9 million in the first quarter last year to $6.6 million this quarter.
LaSalle acquired the hotel in May 2004 for $59 million.
Separately, the REIT is moving forward to redeem its $58.7 million, 7.25 percent Series G Preferred Shares. The redemption is expected to close early July 2014.
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