{"id":1004351465,"date":"2019-09-11T03:37:19","date_gmt":"2019-09-11T11:37:19","guid":{"rendered":"https:\/\/www.commercialsearch.com\/news\/?p=1004351465"},"modified":"2019-09-11T03:40:06","modified_gmt":"2019-09-11T11:40:06","slug":"hersha-hospitality-refinances-300m-term-loan","status":"publish","type":"post","link":"https:\/\/www.commercialsearch.com\/news\/hersha-hospitality-refinances-300m-term-loan\/","title":{"rendered":"Hersha Hospitality Refinances $300M Term Loan"},"content":{"rendered":"
\"Image<\/a>

Image via Pixabay <\/em><\/p><\/div>\n

Hersha Hospitality Trust has been taking advantage of the low-interest rate environment to refinance most of its debt, including the refinancing of a $300 million senior unsecured term loan. The Philadelphia-based REIT has also entered into a series of new swap contracts to fix the interest rates on the remaining $400.9 million of its senior unsecured term loans.<\/p>\n

REIT executives note the transactions, including recent mortgage refinancing of its Hyatt Union Square and Hilton Garden Inn Tribeca in Manhattan, addressed all 2019 and 2020 debt maturities and resulted in the elimination of all debt maturities until 2020. The actions, they said, resulted in 90 percent of the REIT\u2019s outstanding debt being fixed or hedged through various derivative instruments.<\/p>\n

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READ ALSO:<\/strong> Atlanta Airport Hotel Changes Hands<\/a><\/p>\n

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Hersha CEO Jay Shah said the transactions will save the REIT about $2.2 million in interest payments for the rest of this year and $6.7 million in 2020. The refinancing transactions, those that had already occurred and those that were planned, also came up during Hersha\u2019s July 31 conference call with analysts about the second-quarter 2019 earnings report.<\/p>\n

\u201cWith the refinancing of these near-term maturities, we continue to improve our financial flexibility and have ample capacity with cash on hand and our $250 million revolver to execute our business plan and to take advantage of opportunities as they arise,\u201d<\/em> CFO Ashish Parikh told the analysts, according to a transcript.<\/p>\n

The $300 million term loan\u2019s interest rate was swapped from LIBOR plus 185 basis points to a fixed-rate of 3.31 percent that expires in five years. The company also entered into fixed-rate swaps on several loans maturing in 2021 and 2022 for interest rates on those term loans of 3.53 percent and 4.02 percent, respectively. Hersha now has a weighted average interest rate of 3.9 percent across all borrowings with a weighted average life-to-maturity of approximately four years.<\/p>\n

\"Image<\/a>

Image via Pixabay<\/em><\/p><\/div>\n

During the second quarter, Hersha refinanced the existing debt on the Hyatt Union Square hotel at a fixed-rate of 4.17 percent with maturities in 2020 to 2023, Parikh said during the July 31 analysts\u2019 call. He also noted the REIT in July had refinanced the Hilton Garden Inn Tribeca debt with a loan maturing in July 2024 at a fixed rate of 4.02 percent.<\/p>\n

The two Manhattan assets are among 48 hotels totaling 7,644 keys located in New York, Philadelphia, Boston, Washington, D.C., South Florida and other select markets owned and operated by Hersha. The REIT\u2019s properties include high quality upscale, luxury and lifestyle hotels in urban gateway markets and resort destinations.<\/p>\n

Participating lenders<\/h2>\n

The term loan refinancing was arranged by Citibank, N.A., and Wells Fargo Securities LLC as joint lead arrangers and joint book running managers, with Citibank, N.A., as administrative agent and Wells Fargo Bank, National Association as syndication agent. Bank of America, N.A., BMO Harris Bank N.A., BBVA USA, Fifth Third Bank, Goldman Sachs Bank USA, Manufacturers and Trading Trust Co., Raymond James Bank, N.A., and TD Bank, N.A., acted as co-documentation agents.<\/p>\n

First Commercial Bank Ltd. and The Huntington National Bank acted as senior managing agents. Other participating lenders included Wilmington Savings Fund Society, FSB and The Provident Bank.<\/p>\n","protected":false},"excerpt":{"rendered":"

The REIT took advantage of the interest rate environment to fix or hedge most of its outstanding debt in recent months, including refinancing two Manhattan hotels.<\/p>\n","protected":false},"author":1068,"featured_media":1004351504,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21808,21825,21751,23891,21742],"tags":[33052,36894,38344],"class_list":["post-1004351465","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-featured","category-finance","category-hotel","category-national","category-latest","tag-hersha-hospitality-trust","tag-jay-shah","tag-wells-fargo-securities"],"acf":[],"yoast_head":"\nHersha Hospitality Refinances $300M Term Loan - 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\/hersha-hospitality-refinances-300m-term-loan\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Hersha Hospitality Refinances $300M Term Loan\" \/>\n<meta property=\"og:description\" content=\"The REIT took advantage of the interest rate environment to fix or hedge most of its outstanding debt in recent months, including refinancing two Manhattan hotels.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.commercialsearch.com\/news\/hersha-hospitality-refinances-300m-term-loan\/\" \/>\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=\"2019-09-11T11:37:19+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2019-09-11T11:40:06+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2019\/09\/hotel-Image-via-Pixabay-002.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"800\" \/>\n\t<meta property=\"og:image:height\" content=\"620\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Gail Kalinoski\" \/>\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\":\"Article\",\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/hersha-hospitality-refinances-300m-term-loan\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/hersha-hospitality-refinances-300m-term-loan\\\/\"},\"author\":{\"name\":\"Gail Kalinoski\",\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/#\\\/schema\\\/person\\\/fc5b5df1393e5023d2417bd48c2fda57\"},\"headline\":\"Hersha Hospitality Refinances $300M Term Loan\",\"datePublished\":\"2019-09-11T11:37:19+00:00\",\"dateModified\":\"2019-09-11T11:40:06+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/hersha-hospitality-refinances-300m-term-loan\\\/\"},\"wordCount\":534,\"image\":{\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/hersha-hospitality-refinances-300m-term-loan\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/wp-content\\\/uploads\\\/sites\\\/46\\\/2019\\\/09\\\/hotel-Image-via-Pixabay-002.jpg\",\"keywords\":[\"Hersha Hospitality Trust\",\"Jay Shah\",\"Wells Fargo Securities\"],\"articleSection\":[\"Featured\",\"Finance\",\"Hotel\",\"National\",\"News\"],\"inLanguage\":\"en-US\"},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/hersha-hospitality-refinances-300m-term-loan\\\/\",\"url\":\"https:\\\/\\\/www.commercialsearch.com\\\/news\\\/hersha-hospitality-refinances-300m-term-loan\\\/\",\"name\":\"Hersha Hospitality Refinances $300M Term Loan - 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