Equity Inns to Purchase Kentucky Hotels
10 Ottobre 2006 - 4:05PM
Business Wire
Equity Inns, Inc. (NYSE: ENN), the third largest hotel real estate
investment trust (REIT), today announced that the Company has
signed a contract to purchase four Kentucky hotels with a total of
429 rooms from Musselman Hotels, LLC for $53.8 million. The
purchase price represents a capitalization rate of approximately
10% based upon trailing twelve-month net operating income and
includes the assumption of $27 million of existing debt. Musselman
Hotels will retain management under a three year, performance based
management contract. The four properties include three hotels in
the Lexington metropolitan area: a six-year old, 90-room Courtyard
by Marriott in suburban Hamburg, a two-year old, 91-room Residence
Inn also located in Hamburg and a two-year old, 108-suite
SpringHill Suites-Downtown, which was named �SpringHill of the
Year� at the 2006 Marriott franchise owner�s conference. The fourth
property is a six-year old, 140-room Courtyard by Marriott in
downtown Louisville, one block from the recently expanded Kentucky
Convention Center. The Louisville purchase also includes a
250-space parking garage adjacent to the property that serves the
hotel and the many surrounding businesses and attractions in the
downtown area. Mr. Howard Silver, President and CEO, commented,
�This transaction creates significant value for our shareholders in
a number of ways. First, the purchase price for these well-located
assets is attractive and immediately accretive. With an average age
of four years and with strong upscale brands, this purchase
continues our strategy of acquiring younger, premium branded hotels
for our portfolio. We also believe that establishing a relationship
with the Musselman Group, a top-tier hotel developer and operator,
will provide us access to additional quality acquisition
opportunities over time.� The Company expects to close the
transaction by the end of the fourth quarter of this year. Forward
Looking Statements Certain matters discussed in this press release
which are not historical facts are �forward-looking statements�
within the meaning of the federal securities laws and involve risks
and uncertainties. The words �may,� �plan,� �project,�
�anticipate,� �believe,� �estimate,� �forecast, �expect,� �intend,�
�will,� and similar terms are intended to identify forward-looking
statements, which include, without limitation, statements
concerning our outlook for the hotel industry, acquisition and
disposition plans for our hotels and assumptions and forecasts of
future results for fiscal year 2006. Forward-looking statements are
not guarantees of future performance and involve numerous risks and
uncertainties which may cause our actual financial condition,
results of operations and performance to be materially different
from the results of expectations expressed or implied by such
statements. General economic conditions, future acts of terrorism
or war, risks associated with the hotel and hospitality business,
the availability of capital, risks associated with our debt
financing, hotel operating risks and numerous other factors, may
affect our future results and performance and achievements. These
risks and uncertainties are described in greater detail in our 2005
Annual Report on Form 10-K filed on March 15, 2006, and our other
periodic filings with the United States Securities and Exchange
Commission (SEC). We undertake no obligation and do not intend to
publicly update or revise any forward-looking statement, whether as
a result of new information, future events or otherwise. Although
we believe our current expectations to be based upon reasonable
assumptions, we can give no assurance that our expectations will be
attained or that actual results will not differ materially.
Non-GAAP Financial Measures Included in this press release is the
term Capitalization Rate, a "non-GAAP financial measure", common in
the hotel industry, used by the Company to help discuss its
underwriting of acquired or disposed hotel assets. Capitalization
rate, for this discussion, is defined as the percentage derived by
dividing the net operating income of the hotel asset(s), less a
management fee and an allowance for recurring capital expenditures,
by the purchase price paid or received for the hotel asset(s).
About Equity Inns Equity Inns, Inc. is a self-advised REIT that
focuses on the upscale extended stay, all-suite and midscale
limited-service segments of the hotel industry. The Company, which
ranks as the third largest hotel REIT based on number of hotels,
currently owns 125 hotels with 14,924 rooms located in 35 states.
For more information about Equity Inns, visit the Company's Web
site at www.equityinns.com. Equity Inns, Inc. (NYSE: ENN), the
third largest hotel real estate investment trust (REIT), today
announced that the Company has signed a contract to purchase four
Kentucky hotels with a total of 429 rooms from Musselman Hotels,
LLC for $53.8 million. The purchase price represents a
capitalization rate of approximately 10% based upon trailing
twelve-month net operating income and includes the assumption of
$27 million of existing debt. Musselman Hotels will retain
management under a three year, performance based management
contract. The four properties include three hotels in the Lexington
metropolitan area: a six-year old, 90-room Courtyard by Marriott in
suburban Hamburg, a two-year old, 91-room Residence Inn also
located in Hamburg and a two-year old, 108-suite SpringHill
Suites-Downtown, which was named "SpringHill of the Year" at the
2006 Marriott franchise owner's conference. The fourth property is
a six-year old, 140-room Courtyard by Marriott in downtown
Louisville, one block from the recently expanded Kentucky
Convention Center. The Louisville purchase also includes a
250-space parking garage adjacent to the property that serves the
hotel and the many surrounding businesses and attractions in the
downtown area. Mr. Howard Silver, President and CEO, commented,
"This transaction creates significant value for our shareholders in
a number of ways. First, the purchase price for these well-located
assets is attractive and immediately accretive. With an average age
of four years and with strong upscale brands, this purchase
continues our strategy of acquiring younger, premium branded hotels
for our portfolio. We also believe that establishing a relationship
with the Musselman Group, a top-tier hotel developer and operator,
will provide us access to additional quality acquisition
opportunities over time." The Company expects to close the
transaction by the end of the fourth quarter of this year. Forward
Looking Statements Certain matters discussed in this press release
which are not historical facts are "forward-looking statements"
within the meaning of the federal securities laws and involve risks
and uncertainties. The words "may," "plan," "project,"
"anticipate," "believe," "estimate," "forecast, "expect," "intend,"
"will," and similar terms are intended to identify forward-looking
statements, which include, without limitation, statements
concerning our outlook for the hotel industry, acquisition and
disposition plans for our hotels and assumptions and forecasts of
future results for fiscal year 2006. Forward-looking statements are
not guarantees of future performance and involve numerous risks and
uncertainties which may cause our actual financial condition,
results of operations and performance to be materially different
from the results of expectations expressed or implied by such
statements. General economic conditions, future acts of terrorism
or war, risks associated with the hotel and hospitality business,
the availability of capital, risks associated with our debt
financing, hotel operating risks and numerous other factors, may
affect our future results and performance and achievements. These
risks and uncertainties are described in greater detail in our 2005
Annual Report on Form 10-K filed on March 15, 2006, and our other
periodic filings with the United States Securities and Exchange
Commission (SEC). We undertake no obligation and do not intend to
publicly update or revise any forward-looking statement, whether as
a result of new information, future events or otherwise. Although
we believe our current expectations to be based upon reasonable
assumptions, we can give no assurance that our expectations will be
attained or that actual results will not differ materially.
Non-GAAP Financial Measures Included in this press release is the
term Capitalization Rate, a "non-GAAP financial measure", common in
the hotel industry, used by the Company to help discuss its
underwriting of acquired or disposed hotel assets. Capitalization
rate, for this discussion, is defined as the percentage derived by
dividing the net operating income of the hotel asset(s), less a
management fee and an allowance for recurring capital expenditures,
by the purchase price paid or received for the hotel asset(s).
About Equity Inns Equity Inns, Inc. is a self-advised REIT that
focuses on the upscale extended stay, all-suite and midscale
limited-service segments of the hotel industry. The Company, which
ranks as the third largest hotel REIT based on number of hotels,
currently owns 125 hotels with 14,924 rooms located in 35 states.
For more information about Equity Inns, visit the Company's Web
site at www.equityinns.com.
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