Ashford Hospitality Sells 2 Hotels for $38M

The REIT utilized proceeds from the sale of hotels in Georgia and Wisconsin to pay down debt.
Hilton Garden Inn Wisconsin Dells. Image courtesy of Hilton

Ashford Hospitality Trust has sold two hotel assets for a total of $37.8 million. In separate transactions, the REIT sold the 156-key Courtyard Savannah Downtown in Savannah, Ga., and the 128-key Hilton Garden Inn in Wisconsin Dells, Wis.

Courtyard Savannah, located at 415 W. Liberty St. in the city’s historic district, made its debut in 2001. The REIT became sole owner of the property in 2015 with the $250 million acquisition of its partner’s interest in a 24-hotel portfolio. Ashford also added the Wisconsin Dells asset, located at 101 E. Hiawatha Drive, to its portfolio in 2015, paying $15.2 million for the lodging destination. Both Courtyard Savannah and Wisconsin Dells were non-core assets for the REIT, with their respective 12-month trailing RevPAR of $106 and $75 coming in notably below Ashford’s trailing 12-month RevPAR of $127 as of June 30, 2019.

During the company’s first quarter 2019 earnings call on May 3, 2019, Douglas Kessler, president & CEO of Ashford Hospitality Trust Inc., said “We’re going to be opportunistic when it comes to sales with a focus on trying to upgrade the portfolio, mitigating low ROI capex assets, removing lower RevPAR assets and just having an overall positive impact on leverage and cash flow within our portfolio.”  Ashford used all net proceeds from the sales of the properties to pay down debt.

BALANCING ACT

Ashford also recently sold the 251-room Marriott Plaza San Antonio in San Antonio, Texas, walking away with $34 million. The company noted in a prepared statement that it will continue to pursue dispositions that will unlock value in its portfolio; however, Ashford has also been adding assets to its holdings this year. The REIT purchased Hilton Santa Cruz/Scotts Valley, a 158-key property in Santa Cruz, Calif., for $50 million. Ashford also added to its portfolio the 310-key Embassy Suites by Hilton New York Midtown Manhattan—which became the first hotel to fly the Embassy Suites flag in New York City in 2016—in a $195 million transaction.