Also announces the sale of three properties and interest rate swap
agreement
SIOUX FALLS, S.D.--(BUSINESS WIRE)--
Summit Hotel Properties, Inc. (NYSE:INN) (the “Company”), a real estate
investment trust (REIT) specializing in the ownership of premium-branded
hotels in the upscale and upper midscale segments, today announced
recent property acquisitions and dispositions as well as an interest
rate swap agreement.
Acquisitions and Dispositions
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A 112-room Hilton Garden Inn property in Nashville (Smyrna), TN for a
purchase price of $12.0 million including planned property
improvements. The Company anticipates a post-renovation estimated NTM
capitalization rate in the range of 8 to 9 percent.
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A 103-room Courtyard by Marriott in Arlington, TX for a purchase price
of $15.25 million including planned property improvements. The Company
anticipates a post-renovation estimated NTM capitalization rate in the
range of 8 to 9 percent.
In addition to these acquisitions, the Company completed the sale of
three assets in Twin Falls, ID; Holiday Inn Express, Hampton Inn and
AmericInn. The hotels were sold at an economic cap rate in the range of
8.5 to 9 percent on a trailing twelve month basis. The net proceeds from
the aggregate sale price of approximately $16.5 million will be applied
to outstanding debt.
“We are continuing our strategy of recycling capital and transforming
our portfolio,” said Dan Hansen, Company president and CEO. “These
acquisitions and dispositions demonstrate the commitment to our
shareholders on delivering top brands in top markets and creating great
value for our investors.”
Interest Rate Swap Agreement
In addition to the recently announced improvements made to the Company’s
senior secured revolving credit facility, the Company entered into three
interest rate swap agreements that fixed 90-day LIBOR on $29.7 million
of its variable rate debt with General Electric Capital Corporation. On
May 4, the company had fixed LIBOR, at a weighted average rate of
1.137%, on $29.7 million of its variable rate debt through three
interest rate swap agreements. After accounting for the three interest
rate swap agreements, the company's total debt had a weighted average
effective interest rate of 5.3% and fixed interest rates on 80% of its
term debt as of March 31, 2012.
“The improvements we have made to our debt structure demonstrate our
commitment to prudent, conservative leverage,” said Hansen. “This is the
proven strategy that has allowed our company, and our predecessor
company, to provide a solid total return to our investors for nearly
twenty years.”
About Summit Hotel Properties
Summit Hotel Properties, Inc. is a self-advised real estate investment
trust focused on acquiring and owning premium-branded select-service
hotels in the upscale and upper midscale segments. As of May 29, 2012,
the company’s hotel portfolio consisted of 72 hotels with a total of
7,407 guestrooms located in 20 states. Additional information about
Summit may be found at the company’s website, www.shpreit.com.
Forward Looking Statements
This press release contains statements that are “forward-looking
statements” within the meaning of Section 27A of the Securities Act of
1933, as amended, and Section 21E of the Securities Act of 1934, as
amended, pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995.Forward-looking
statements are generally identifiable by use of forward-looking
terminology such as “may,” “will,” “should,” “potential,” “intend,”
“expect,” “seek,” “anticipate,” “estimate,” “approximately,” “believe,”
“could,” “project,” “predict,” “forecast,” “continue,” “plan” or other
similar words or expressions.These forward-looking statements
relate to the payment of dividends.Forward-looking statements
are based on certain assumptions and can include future expectations,
future plans and strategies, financial and operating projections or
other forward-looking information. These forward-looking statements are
subject to various risks and uncertainties, not all of which are known
to the Company and many of which are beyond the Company’s control, which
could cause actual results to differ materially from such statements.
These risks and uncertainties include, but are not limited to, the state
of the U.S. economy, supply and demand in the hotel industry and other
factors as are described in greater detail in the Company’s filings with
the Securities and Exchange Commission (“SEC”), including, without
limitation, the Company’s Annual Report on Form 10-K for the year ended
December 31, 2011. Unless legally required, the Company disclaims any
obligation to update any forward-looking statements, whether as a result
of new information, future events or otherwise.
Summit Hotel Properties, Inc.
Dan Boyum, 605-782-2015
VP of
Investor Relations
dboyum@shpreit.com
Source: Summit Hotel Properties, Inc.