Four Hotels Change Hands in $119M Deal
- Dec 22, 2016
Orlando, Fla.—Xenia Hotels & Resorts Inc. has sold four hotels to an undisclosed buyer, for a combined $119 million, which is an 11.0x multiple on the hotels’ combined 2016 projected EBITDA.
The properties in the transaction consisted of the 162-key Homewood Suites by Hilton Houston Near the Galleria, the 148-key Hampton Inn & Suites Denver Downtown, the 178-key Hilton Garden Inn Chicago North Shore/Evanston and the 195-key Hilton St. Louis Downtown.
Xenia retained nearly $1.5 million in capital reserve funds related to the properties.
“We are pleased with the dispositions of these non-core assets, as well as the pricing we were able to achieve,” Marcel Verbaas, Xenia’s president & CEO, said in a prepared release. “While we remain bullish on the long-term prospects of our remaining higher-quality hotels in Houston, Denver and Chicago, the sale of these select service assets allowed us to reduce our overall exposure in these markets.”
Proceeds from the sale will be utilized for general corporate purposes, which may include debt repayments, potential acquisitions consistent with the company’s long-term strategy, and share repurchases under the Xenia’s existing authorization.
“The continued enhancement of our portfolio is exemplified by the fact that these four hotels were projected to achieve a combined RevPAR of approximately $115 and EBITDA per key of approximately $16,000 in 2016, with both measures significantly lagging the remainder of our portfolio,” Verbaas said.