Hospitality Investors Trust has successfully refinanced two loans and completed the acquisition of seven hotels pursuant to its previously announced purchase agreement with Summit Hotel Properties, Inc. The new loans, which total approximately $1.225 billion, each carry a two-year initial term with three one-year extension options. Citibank acted as administrative agent and as collateral agent, and Citigroup and Deutsche Bank acted as joint lead arrangers for the funding along with JPMorgan Chase Bank, National Association also acting as initial lender.
The seven hotels in the Summit Portfolio consist of 651 keys and were acquired for an aggregate purchase price of $66.8 million. All the properties in the portfolio have long term franchise agreements with one of the following brands: Marriott International (Courtyard, Residence Inn and Fairfield Inn), Hilton Hotels (Homewood Suites) or IHG (Staybridge Suites). The properties are located in Germantown, Tennessee and Ridgeland, Mississippi. Once closed, the transaction will increase the company’s lodging portfolio to 148 hotels totaling 17,844 keys across 33 states.
Jonathan P. Mehlman, President and CEO HIT REIT, said the refinancing would “enhance our capital structure by affording us a meaningful reduction of our cost of capital as well as the extension of maturities until 2022 on a significant portion of our mortgage debt. In addition, we are pleased to close on this portfolio of seven premium-branded select-service hotels from Summit.”
