WASHINGTON, DC—At least three local hotels are becoming fully-owned assets by Ashford Hospitality Trust as the REIT buys out the remaining 28.26% of ownership interest in the Highland Hospitality portfolio from its JV partner, a transaction GlobeSt.com reported this week.
The 28-property portfolio is valued at $1.735 billion. Prudential Real Estate Investors is the partner in the deal.
The three local assets include the Marriott Courtyard, a 210-unit hotel located in Gaithersburg, MD; the Melrose, a 240-key boutique hotel located at 2430 Pennsylvania Ave NW; and the Churchill Hotel, another boutique hotel located at 1914 Connecticut Ave NW, with 144 rooms.
In the Baltimore area, properties part of the deal are the Hilton Garden Inn BWI Airport, a 158-unit hotel located at 1516 Aero Dr. and the 196-key Sheraton in Annapolis, located at 173 Jennifer Rd.
Ashford and Prudential have owned the portfolio since 2011. It includes 19 full-service hotels and nine select-service properties, with a concentration in major brands such as Hilton, Marriott, Hyatt and Starwood. The two companies first partnered with a $70-million mezzanine loan in the sixth tranche position on the portfolio in 2008.
The purchase price Ashford is paying for the remaining ownership interest equates to a forward 12-month cap rate of 7.4% and a forward EBITDA multiple of 11.6x, and a trailing 6.9% cap and EBITDA multiple of 12.5x. The deal is expected to close in the first quarter of 2015.
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