Nashville Hotel Added to American Hotel Income Properties Portfolio
- Nov 04, 2016
By Carmen Horghidan
Nashville, Tenn.—American Hotel Income Properties REIT, a Canada-based limited partnership company, recently announced the acquisition of a 104-room hotel in Nashville. The property was acquired for an aggregate purchase price of $8.7 million, including approximately $1 million for planned capital expenditures and excluding closing and post-acquisition adjustments. After all management fees, FF&E reserve contributions, and renovation costs, the cap rate of the transaction is approximately 10 percent. The transaction is expected to be closed in early December, this year.
The facility features a multi-year lodging contract with an existing railway customers that guarantees 58 guestrooms per night. Planned renovations will include immediate conversion of the property to the Oak Tree Inn rail crew hotel standards, such as ‘Dark and Quiet’ guestrooms, common area upgrades, and new property and yield management systems. The hotel will be managed by Tower Rock Hotels & Resorts Inc., a wholly-owned subsidiary of O’Neill Hotels & Resorts.
“This strategic acquisition of a rail crew hotel, uniquely located within a strong, high-demand commercial and leisure market, allows us to both strengthen our relationship with one of our key railway customers and also maximize transient and commercial lodging business,” Ian McAuley, president of AHIP, said in a prepared statement. “The continued growth of our contractual relationships with major railway companies is consistent with AHIP’s strategy of providing long-term sustainable returns to our unitholders,” added Rob O’Neill, CEO of AHIP.
Following its latest acquisitions, AHIP now owns 91 hotels totaling 8,686 guest rooms.
Image courtesy of American Hotel Income Properties