Yahoo Finance Hersha Hospitality Trust Closes the Sale of Hotel Milo Santa Barbara and Pan Pacific Seattle
– Price implies a blended 2.9% cap rate and 27.0x EBITDA multiple on 2019 results and a ~ $455K per key valuation–
– Coupled with the USS-7 sale and pending dispositions, the sale of Hotel Milo and Pan Pacific would increase total sales to nearly $650M in 2022–
– Funds from Sales facilitate Debt repayment of $500M and generate unrestricted cash of approximately $120M–
PHILADELPHIA, Oct. 25, 2022 (GLOBE NEWSWIRE) -- Hersha Hospitality Trust (NYSE: HT) (“Hersha” or the “Company”), owner of luxury and lifestyle hotels in coastal gateway and resort markets, has closed on the previously announced sales of The Hotel Milo Santa Barbara and The Pan Pacific Seattle.
Mr. Jay H. Shah, Hersha’s Chief Executive Officer, stated, “We’re pleased to have closed these two previously announced dispositions. We believe the pricing on these two assets reflects our realigned portfolio’s per key valuation and further highlights Hersha’s public-to-private market valuation disconnect.”
Mr. Shah continued, “The timing of all of our dispositions has been very strategic. Holding assets into 2022 allowed us to benefit from increased hotel cash flows in the first half of the year, bringing pricing close to our internal NAV, while allowing us to take full advantage of a more active transaction and financing market than we are witnessing in today’s environment. The sales of Hotel Milo Santa Barbara and Pan Pacific Seattle, coupled with the dispositions of the Urban Select Service portfolio and other pending dispositions, total approximately $650M in gross proceeds and will reduce our debt load by approximately $500M while generating unrestricted cash of nearly $120M. As we move into the fourth quarter, we maintain significant financial and operational flexibility with a projected year-end cash balance exceeding $200M and a $100M undrawn line of credit.”
Hersha Hospitality Trust (HT) is a self-advised real estate investment trust in the hospitality sector, which owns and operates luxury and lifestyle hotels in coastal gateway and resort markets. The Company’s 28 hotels totaling 4,270 rooms are located in New York, Washington, DC, Boston, Connecticut, Philadelphia, South Florida, and select markets on the West Coast.
The Company's common shares are traded on The New York Stock Exchange under the ticker “HT.” For more information on the Company, and the Company’s hotel portfolio, please visit the Company's website at www.hersha.com
Forward Looking Statement This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, and, as such, may involve known and unknown risks, uncertainties and other factors that may cause the actual results or performance to differ from those reflected in the forward-looking statement, including, without limitation, the Company’s ability to close on any pending transactions on the terms and timing it expects, if at all, the Company’s expected use for the proceeds of any asset sales, and the Company’s evaluation of market valuations for its assets. Forward-looking statements are generally identifiable by use of forward-looking terminology such as “believe,” “could,” “outlook,” “consider,” “expect,” “anticipate,” “forecast,” “project,” “likely,” “estimate,” “plan,” “continue,” “maintain,” “intend,” “should,” “may” and words of similar import. Because these forward-looking statements relate to future events, the Company’s plans, strategies, prospects and future financial performance, and involve known and unknown risks that are difficult to predict and may be outside the Company’s control, they are not guarantees of future results and are subject to risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed in any forward-looking statement. Therefore, you should not rely on any of these forward-looking statements. For a description of factors that may cause the Company’s actual results or performance to differ from its forward-looking statements, please review the information under the heading “Risk Factors” included in the Company’s most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q filed by the Company with the Securities and Exchange Commission (“SEC”) and other documents filed by the Company with the SEC from time to time. All information provided in this press release, unless otherwise stated, is as of October 25 2022, and the Company undertakes no duty to update this information unless required by law.
Contact: | Ashish Parikh, Chief Financial Officer |
| Andrew Tamaccio, Director of Investor Relations & Finance |
| Phone: (215) 238-1046 |
