Ashford Hospitality Trust, Inc. has announced that it has signed a definitive agreement to sell its 144-room Residence Inn located in Salt Lake City, Utah for $19.2 million. The sale is expected to be completed in early March and is subject to normal closing conditions.
The Company provided no assurances that the sale will be completed on these terms or at all. When adjusted for the Company's anticipated capital expenditures, the sale price represents a 4.6 percent capitalisation rate on 2023 net operating income, or 18.2x 2023 Hotel EBITDA. Excluding the anticipated capital spend, the sale price represents a 6.0 percent capitalisation rate on 2023 net operating income, or 14.0x 2023 Hotel EBITDA. All of the proceeds from the sale are expected to be used to pay down debt.
"We are pleased to announce the signed agreement to sell the Residence Inn Salt Lake City at a very attractive cap rate," commented Rob Hays, Ashford Trust's President and Chief Executive Officer.
"We continue to have several assets in the market at various stages of the sales process and look forward to providing more updates in the coming weeks."
Ashford Hospitality Trust is a real estate investment trust focused on investing predominantly in upper upscale, full-service hotels.
The sale is one of many anticipated for Ashford Hospitality, who previously announced its intention to sell off its properties in Boston, Atlanta, Savannah, and Orlando among others.
"As we enter 2024, we are focused on paying off our strategic corporate financing. Between the excess proceeds from planned asset sales, excess proceeds from planned property refinancings, and proceeds from our non-traded preferred capital raise, we believe we have a viable path to pay off our strategic financing this year. Our hotel portfolio also continues to benefit from its geographic diversification, and I believe we are well-positioned to continue to outperform."
