BETHESDA, MD–Hersha Hospitality Trust has closed on the sale of two suburban Washington DC hotels that are part of a previously-announced five-asset portfolio deal that was originally expected to trade at $185 million, or $244,000 per key.
The 203-room Courtyard by Marriott in Alexandria and the 120-room Residence Inn in Greenbelt have sold as expected for $62 million.
Their sale delivers a blended trailing cap rate of 7.4% based on the hotels' net operating income in 2016, and a hotel EBITDA multiple of 12.1x. Hersha's net proceeds are $60.1 million.
In the meantime Hersha says it has negotiated an additional $7.5 million for the remaining three West Coast hotels in the portfolio for a new price of $130.5 million. It has agreed to a six-month extension to close the books on those properties with no guarantee the deal will go through.
Of the two properties it has sold to the unnamed buyer, “we expect to redeploy sales proceeds in strategic growth markets to offset taxable gains given our low basis in the hotels that we sold,” Hersha CEO Jay H. Shah said in a prepared statement.
BETHESDA, MD–Hersha Hospitality Trust has closed on the sale of two suburban Washington DC hotels that are part of a previously-announced five-asset portfolio deal that was originally expected to trade at $185 million, or $244,000 per key.
The 203-room Courtyard by Marriott in Alexandria and the 120-room Residence Inn in Greenbelt have sold as expected for $62 million.
Their sale delivers a blended trailing cap rate of 7.4% based on the hotels' net operating income in 2016, and a hotel EBITDA multiple of 12.1x. Hersha's net proceeds are $60.1 million.
In the meantime Hersha says it has negotiated an additional $7.5 million for the remaining three West Coast hotels in the portfolio for a new price of $130.5 million. It has agreed to a six-month extension to close the books on those properties with no guarantee the deal will go through.
Of the two properties it has sold to the unnamed buyer, “we expect to redeploy sales proceeds in strategic growth markets to offset taxable gains given our low basis in the hotels that we sold,” Hersha CEO Jay H. Shah said in a prepared statement.
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