|By PR Newswire||
|February 17, 2014 05:27 PM EST||
VANCOUVER, Feb. 17, 2014 /PRNewswire/ - American Hotel Income Properties REIT LP ("AHIP") (Toronto Stock Exchange: HOT.UN; OTCQX: AHOTF) announced today that it has agreed to acquire, through its subsidiaries, four hotel properties located in Virginia (the "Acquisition Portfolio") for an aggregate purchase price of approximately US$37.1 million, including up to US$1.6 million for defeasance of existing debt, and excluding post-acquisition adjustments and brand mandated property improvement plans.
The Acquisition Portfolio will be purchased at a weighted average going-in capitalization rate of approximately 10.0%, after inclusion of all hotel management fees, administration fees and brand franchise fees, or approximately US$92,060 per room (excluding brand mandated property improvement plans to upgrade furniture, fixtures and equipment, which AHIP expects to be approximately US$6.0 million). Including the property improvement plans and closing costs, the aggregate cost to AHIP for the Acquisition Portfolio is expected by management to be approximately US$44.5 million.
- Quality portfolio of four select-service hotel properties located in Harrisonburg, Emporia, and South Hill, Virginia
- The properties operate under well-established, leading national hotel brands: Hampton Inn (Hilton) and Fairfield Inn & Suites (Marriott)
- The Acquisition Portfolio has stable historical operating metrics and all four properties are located in close proximity to Interstate highway exits
- The Harrisonburg University hotel is close to James Madison University, which has approximately 20,000 students enrolled
- AHIP's pro forma payout and leverage ratios remain conservative after giving effect to the Acquisition Portfolio, at approximately 73.4% on projected 2014 AFFO of the Acquisition Portfolio and a projected debt to gross book value of approximately 51.2%
- Expected by to be immediately accretive to AFFO per unit
- The total acquisition price including budgeted property improvement plan costs of the Acquisition Portfolio are significantly below the as-stabilized appraised value of US$45.8 million as determined by a third party appraiser, and management's estimate of replacement cost
- Finance with a first mortgage of up to US$24.5 million, bearing an anticipated weighted average interest rate of approximately 4.85%, fixed for 10 years, with the remainder financed with cash from the bought deal offering that closed on October 31, 2013
- The transaction is expected to close in mid-March, 2014
Rob O'Neill, AHIP's CEO commented, "We are very pleased to announce this acquisition, which is consistent with our stated growth strategy as outlined at the time of AHIP's initial public offering, targeting acquisitions of transportation-oriented and select and limited-service hotels, located in secondary markets in the United States in close proximity to railroads, airports, highway interchanges, and other transportation hubs and demand generators. This acquisition represents another opportunity for AHIP to purchase a high quality, well-maintained portfolio at a price that is below our estimate of its replacement cost. We expect this acquisition to be immediately accretive to our AFFO per unit."
The Acquisition Portfolio
The Acquisition Portfolio is comprised of an aggregate of 403 guest rooms and consists of three hotels under the "Hampton Inn" flag (a Hilton brand), and one hotel under the "Fairfield Inn & Suites" flag (a Marriott brand). The properties are located in Harrisonburg, Emporia and South Hill, Virginia, near transportation hubs and other major demand generators such as James Madison University, manufacturing facilities, distribution centres and medical centres. The properties cater primarily to corporate travelers seeking select-service lodging. The following table sets out certain key characteristics of the Acquisition Portfolio:
|Hampton Inn University||Harrisonburg, Virginia||1988||160||67.90%||$99.55||$67.61|
|Hampton Inn South||Harrisonburg, Virginia||2008||90||75.20%||$90.32||$67.94|
|Hampton Inn||Emporia, Virginia||2005||85||77.00%||$90.79||$69.95|
|Fairfield Inn & Suites||South Hill, Virginia||2007||68||80.50%||$81.66||$65.73|
|Total / Weighted Average||403||73.60%||$92.21||$67.86|
AHIP is also purchasing land adjacent to two of the properties for US$0.1 million, primarily to serve as a buffer to adjacent businesses.
Following the closing of the Acquisition Portfolio, AHIP's portfolio will be comprised of 41 hotels located in 20 states across the United States, representing an aggregate of 3,517 rooms, excluding the four previously announced properties currently under development through SunOne Developments Inc. ("SunOne"), which represent 241 additional rooms in the aggregate.
AHIP currently owns 37 hotel properties, of which three operate under the "Hampton Inn" flag (a Hilton brand) and one operates under the "Residence Inn" flag (a Marriott brand). The remaining 33 hotels, with an aggregate of 2,642 rooms, are focused on serving railway customers (32 operate under AHIP's proprietary "Oak Tree Inn" brand and one operates under the "Best Western" brand), with approximately 61% of the total available room-nights covered under contracts containing minimum occupancy guarantees.
February Cash Distribution
AHIP also announced the cash distribution of Cdn$0.075 per limited partnership unit ("Unit") of AHIP for the period of February 1, 2014 to February 28, 2014, which is equivalent to Cdn$0.90 per Unit on an annualized basis. The distribution will be paid on March 14, 2014 to unitholders of record at the close of business on February 28, 2014. There are currently 14,437,800 Units issued and outstanding.
The policy of AHIP is to pay cash distributions on or about the 15th day of each month to the unitholders of record on the last business day of the preceding month.
Certain statements contained in this news release may constitute forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "anticipate", "plan", "expect", "may", "will", "intend", "should", and similar expressions. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. Forward-looking statements in this news release include, without limitation, the following: references to the purchase and closing costs of the Acquisition Portfolio; the components used in the determination of weighted average going-in capitalization rates, pro forma leverage and payout ratios; the completion and estimated costs of property improvement plans; as stabilized values of the Acquisition Portfolio; accretive effect of the Acquisition Portfolio on AFFO per unit; the expected time of closing of the transaction; the obtainment and interest rates of new mortgage financing on the Acquisition Portfolio; the development of four hotels by SunOne and the focus on acquiring additional suitable hotels in strategic locations.
Forward-looking information is based on a number of key expectations and assumptions made by AHIP, including, without limitation: a reasonably stable North American economy and stock market and the ability to successfully integrate the Acquisition Portfolio. Although the forward-looking information contained in this news release is based on what AHIP's management believes to be reasonable assumptions, AHIP cannot assure investors that actual results will be consistent with such information.
Forward-looking information reflects current expectations of AHIP's management regarding future events and operating performance as of the date of this news release. Such information involves significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not such results will be achieved. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, without limitation, those factors that can be found under "Risk Factors" in AHIP's Annual Information Form dated March 28, 2013 and AHIP's Management's Discussion and Analysis dated November 7, 2013.
The forward-looking statements contained herein represent AHIP's expectations as of the date of this news release, and are subject to change after this date. AHIP assumes no obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required by applicable law.
About American Hotel Income Properties REIT LP
AHIP is a limited partnership formed under the Limited Partnerships Act (Ontario) to invest in hotel real estate properties located substantially in the United States and engaged primarily in the railroad employee accommodation, transportation and contract-focused lodging sectors. AHIP's long-term objectives are to: (i) generate stable and growing cash distributions from hotel properties substantially in the US; (ii) enhance the value of its assets and maximize the long-term value of the hotel properties through active management; and (iii) expand its asset base and increase its AFFO per Unit through an accretive acquisition program, participation in strategic development opportunities and improvements to its properties through targeted value-added capital expenditure programs.
THE TORONTO STOCK EXCHANGE HAS NOT REVIEWED AND DOES NOT ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR THE ACCURACY OF THIS RELEASE.
SOURCE American Hotel Income Properties REIT LP
Palerra, the cloud security automation company, announced enhanced support for Amazon AWS, allowing IT security and DevOps teams to automate activity and configuration monitoring, anomaly detection, and orchestrated remediation, thereby meeting compliance mandates within complex infrastructure deployments. "Monitoring and threat detection for AWS is a non-trivial task. While Amazon's flexible environment facilitates successful DevOps implementations, it adds another layer, which can become a ...
Jul. 27, 2015 10:15 PM EDT Reads: 265
The speed of software changes in growing and large scale rapid-paced DevOps environments presents a challenge for continuous testing. Many organizations struggle to get this right. Practices that work for small scale continuous testing may not be sufficient as the requirements grow. In his session at DevOps Summit, Marc Hornbeek, Sr. Solutions Architect of DevOps continuous test solutions at Spirent Communications, explained the best practices of continuous testing at high scale, which is rele...
Jul. 27, 2015 10:00 PM EDT Reads: 1,312
"We got started as search consultants. On the services side of the business we have help organizations save time and save money when they hit issues that everyone more or less hits when their data grows," noted Otis Gospodnetić, Founder of Sematext, in this SYS-CON.tv interview at @DevOpsSummit, held June 9-11, 2015, at the Javits Center in New York City.
Jul. 27, 2015 09:45 PM EDT Reads: 966
Growth hacking is common for startups to make unheard-of progress in building their business. Career Hacks can help Geek Girls and those who support them (yes, that's you too, Dad!) to excel in this typically male-dominated world. Get ready to learn the facts: Is there a bias against women in the tech / developer communities? Why are women 50% of the workforce, but hold only 24% of the STEM or IT positions? Some beginnings of what to do about it! In her Opening Keynote at 16th Cloud Expo, S...
Jul. 27, 2015 09:00 PM EDT Reads: 2,019
With SaaS use rampant across organizations, how can IT departments track company data and maintain security? More and more departments are commissioning their own solutions and bypassing IT. A cloud environment is amorphous and powerful, allowing you to set up solutions for all of your user needs: document sharing and collaboration, mobile access, e-mail, even industry-specific applications. In his session at 16th Cloud Expo, Shawn Mills, President and a founder of Green House Data, discussed h...
Jul. 27, 2015 08:45 PM EDT Reads: 174
Delphix, the market leader in Data as a Service (DaaS), has been announced winner of the DevOps Solution Award at the prestigious Computing Vendor Excellence Awards in London. The awards celebrate the achievements of the technology vendors and service providers that are leading the field of enterprise IT. Delphix was recognised as the vendor demonstrating the most effective support of DevOps culture for its ability to improve time to market and collaboration between teams.
Jul. 27, 2015 08:00 PM EDT Reads: 253
"Our biggest growth area has been the security services, the managed services - the things that differentiate us in the market that there is no client that's too small and there's no client that's too big," explained Paul Mazzucco, Chief Security Officer at TierPoint, in this SYS-CON.tv interview at 16th Cloud Expo, held June 9-11, 2015, at the Javits Center in New York City.
Jul. 27, 2015 06:30 PM EDT Reads: 302
The Cloud industry has moved from being more than just being able to provide infrastructure and management services on the Cloud. Enter a new era of Cloud computing where monetization’s services through the Cloud are an essential piece of strategy to feed your organizations bottom-line, your revenue and Profitability. In their session at 16th Cloud Expo, Ermanno Bonifazi, CEO & Founder of Solgenia, and Ian Khan, Global Strategic Positioning & Brand Manager at Solgenia, discussed how to easily o...
Jul. 27, 2015 06:00 PM EDT Reads: 329
"We've just seen a huge influx of new partners coming into our ecosystem, and partners building unique offerings on top of our API set," explained Seth Bostock, Chief Executive Officer at IndependenceIT, in this SYS-CON.tv interview at 16th Cloud Expo, held June 9-11, 2015, at the Javits Center in New York City.
Jul. 27, 2015 06:00 PM EDT Reads: 514
Explosive growth in connected devices. Enormous amounts of data for collection and analysis. Critical use of data for split-second decision making and actionable information. All three are factors in making the Internet of Things a reality. Yet, any one factor would have an IT organization pondering its infrastructure strategy. How should your organization enhance its IT framework to enable an Internet of Things implementation? In his session at @ThingsExpo, James Kirkland, Red Hat's Chief Arch...
Jul. 27, 2015 05:30 PM EDT Reads: 1,329
Sysdig has announced two significant milestones in its mission to bring infrastructure and application monitoring to the world of containers and microservices: a $10.7 million Series A funding led by Accel and Bain Capital Ventures (BCV); and the general availability of Sysdig Cloud, the first monitoring, alerting, and troubleshooting platform specializing in container visibility, which is already used by more than 30 enterprise customers. The funding will be used to drive adoption of Sysdig Clo...
Jul. 27, 2015 05:00 PM EDT Reads: 399
The Software Defined Data Center (SDDC), which enables organizations to seamlessly run in a hybrid cloud model (public + private cloud), is here to stay. IDC estimates that the software-defined networking market will be valued at $3.7 billion by 2016. Security is a key component and benefit of the SDDC, and offers an opportunity to build security 'from the ground up' and weave it into the environment from day one. In his session at 16th Cloud Expo, Reuven Harrison, CTO and Co-Founder of Tufin,...
Jul. 27, 2015 03:00 PM EDT Reads: 426
The Internet of Things is not only adding billions of sensors and billions of terabytes to the Internet. It is also forcing a fundamental change in the way we envision Information Technology. For the first time, more data is being created by devices at the edge of the Internet rather than from centralized systems. What does this mean for today's IT professional? In this Power Panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, panelists addressed this very serious issue of pro...
Jul. 27, 2015 03:00 PM EDT Reads: 1,220
"We do data integration for B2B also application to application, and we do data management and enable Big Data," explained Pat Adamiak, Vice President, Product Marketing at Liaison Technologies, in this SYS-CON.tv interview at 16th Cloud Expo, held June 9-11, 2015, at the Javits Center in New York City.
Jul. 27, 2015 03:00 PM EDT Reads: 296
"We specialize in testing. DevOps is all about continuous delivery and accelerating the delivery pipeline and there is no continuous delivery without testing," noted Marc Hornbeek, Sr. Solutions Architect at Spirent Communications, in this SYS-CON.tv interview at @DevOpsSummit, held June 9-11, 2015, at the Javits Center in New York City.
Jul. 27, 2015 02:45 PM EDT Reads: 315