{"id":1004126450,"date":"2015-08-31T07:43:07","date_gmt":"2015-08-31T15:43:07","guid":{"rendered":"https:\/\/www.commercialsearch.com\/news\/?p=1004126450"},"modified":"2020-04-24T08:19:16","modified_gmt":"2020-04-24T16:19:16","slug":"ashford-hospitality-explores-strategic-alternatives","status":"publish","type":"post","link":"https:\/\/www.commercialsearch.com\/news\/ashford-hospitality-explores-strategic-alternatives\/","title":{"rendered":"Ashford Hospitality Explores Strategic Alternatives"},"content":{"rendered":"

By Dees Stribling, Contributing Editor<\/em><\/p>\n

Ashford Hospitality Prime<\/a> Inc., a REIT that specializes in hotel properties, may be for sale. The company’s directors have tapped Deutsche Bank Securities to explore “strategic alternatives,” which always includes the possibility of a sale.<\/p>\n

Investors are certainly interested in hotels these days. “The consensus outlook for strong near-to-medium term lodging fundamentals and widespread debt capital availability for hotels — particularly in the form of large loan\/single borrower CMBS transactions — set the table for hotel LBOs, generally,” Fitch Ratings director-U.S. REITs and Lodging Steve Boyd told Commercial Property Executive.<\/em><\/p>\n

Boyd added that Ashford’s discounted valuation (relative to net asset value) could facilitate a privatization.
\n“However, existing mortgage encumbrances on select properties and the company’s related-party management contracts are considerations that could turn off private equity players, given the potential for reduced operating and financing flexibility,” he noted.<\/p>\n

As of the end of the second quarter of 2015, the company reported assets of $5 billion, with mortgage debt of $3.7 billion. Ashford Trust’s total combined debt has a blended average interest rate of 4.96 percent.<\/p>\n

The company focuses mostly on upper upscale, full-service hotels. As of the second quarter of\u00a02015, the company owned 127 hotels, though the company plans to sell 23 select-service properties, the better to focus on the balance of its properties, which are upper upscale.<\/p>\n

Dallas-based Ashford reported a solid second quarter overall. For all of its properties, RevPAR increased 6.6 percent to $122.46 for 2Q15, compared with the same quarter a year earlier. ADR experienced a 5.5 percent increase year-over-year, and occupancies were up portfolio-wide for the year by 1 percent.<\/p>\n

The company has also been active in acquisitions lately. In June, it closed on the 266-key La Pavillon Hotel in New Orleans for $62.5 million, which represents a 7.8 percent cap rate. In July, it closed on the 237-key W Atlanta Downtown<\/a> for $56.8 million, a 7.2 percent cap rate. Ashford also inked a deal recently to buy the 229-room W Minneapolis Hotel-The Foshay and the Le Meridien Chambers Minneapolis for $101 million, and will assume $56 million in mortgage debt on the W Minneapolis.<\/p>\n","protected":false},"excerpt":{"rendered":"

Ashford Hospitality Prime may be for sale.<\/p>\n","protected":false},"author":1023,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21783,21742],"tags":[],"class_list":["post-1004126450","post","type-post","status-publish","format-standard","hentry","category-investment","category-latest"],"acf":[],"yoast_head":"\nAshford Hospitality Explores Strategic Alternatives - Commercial Property Executive<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.commercialsearch.com\/news\/ashford-hospitality-explores-strategic-alternatives\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Ashford Hospitality Explores Strategic Alternatives\" \/>\n<meta property=\"og:description\" content=\"Ashford Hospitality Prime may be for sale.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.commercialsearch.com\/news\/ashford-hospitality-explores-strategic-alternatives\/\" \/>\n<meta property=\"og:site_name\" content=\"Commercial Property Executive\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/CPExecutive\" \/>\n<meta property=\"article:published_time\" content=\"2015-08-31T15:43:07+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2020-04-24T16:19:16+00:00\" \/>\n<meta name=\"author\" content=\"Dees Stribling\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@cpexecutive\" \/>\n<meta name=\"twitter:site\" content=\"@cpexecutive\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.commercialsearch.com\/news\/ashford-hospitality-explores-strategic-alternatives\/\",\"url\":\"https:\/\/www.commercialsearch.com\/news\/ashford-hospitality-explores-strategic-alternatives\/\",\"name\":\"Ashford Hospitality Explores Strategic Alternatives - 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