X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.

BETHESDA, MD-Host Hotels & Resorts, Inc., the nation’s largest hotel REIT, reported its second quarter earnings have quadrupled to $320 million from $80 million in the same period the previous year—in large part due to its acquisition 28 hotels from Starwood Hotels & Resorts Worldwide, Inc., earlier this Spring. Also, hotel revenue per available room, or RevPAR, during Q2 second quarter rose 9.7% compared to Q2 2005.

Host Hotels maintains that if the Starwood hotels were included in the results for both periods, RevPAR would have grown 13% during the quarter compared with last year. Its forecasts for 2006 include hotel RevPAR to increase approximately 9% to 10% for the third quarter and 8.5% to 10% for the full year.

“We significantly exceeded the high-end of our expectations and analysts’ consensus estimates by posting another quarter of strong RevPAR and margin growth,” Christopher J. Nassetta, president and chief executive officer, says.

The company acquired 25 domestic hotels and three foreign hotels from Starwood, for $3.1 billion in April. That month the company issued $800 million of 6-3/4% Series P senior notes due 2016 for net proceeds of approximately $787 million, which were used to fund a portion of the Starwood acquisition.

In May, the company signed a definitive agreement to purchase The Westin Kierland Resort & Spa in Scottsdale, AZ, for approximately $393 million, including the assumption of $135 million of mortgage debt with an interest rate of approximately 5.08%. The sale is expected to close in the third quarter . Host Hotels is financing $260 million of this transaction in cash. According to its earnings statements, as of June 16, 2006, the company had $524 million of cash and cash equivalents, and $575 million of availability under its credit facility.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?

 

GlobeSt

Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt
Live Chat

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.