Six Hotels from Summit Hotel Properties, Inc, totalling 707 rooms, were recently acquired by American Realty Capital Hospitality Trust, Inc for the purchase price of $108.3 million.
"With the increased volatility in the capital markets, we have reviewed our acquisitions carefully. Summit has been a great business partner, and we are pleased to be buying another high-performing hotel portfolio transaction with them. We believe our overall portfolio will continue to generate strong, durable income moving forward," said Edward Hoganson, Chief Financial Officer of ARC Hospitality. "Further, we have selected Crestline Hotels and Resorts and Interstate Hotels & Resorts to manage the hotels in this portfolio because of the firms' proven track record of driving premium revenues and delivering an excellent guest experience."
According to the press release of ARC Hospitality in PR NewsWire, the acquired hotels, either branded by Marriott International or Hilton Hotels & Resorts, are located in Bellevue and Spokane, Washington, as well as Denver and Fort Collins, Colorado. With the transaction, ARC now has 142 hotels totaling 17,351 rooms across 32 states.
The previously terminated agreement of ARC Hospitality and Summit, in which ARC Hospitality agreed to acquire a portfolio of 10 hotels from Summit -- as part of the the balance of the 26-hotel portfolio acquisition initially announced by ARC Hospitality in June 2015 -- was also reinstated. The remaining 10 hotels are scheduled to be closed by ARC Hospitality in late 2016.
"We are pleased to acquire these high-quality lodging properties, located in key Colorado and Washington markets, from Summit," commented Jonathan P. Mehlman, Chief Executive Officer of ARC Hospitality. "The hotels have been purchased at what we believe is an attractive yield and price per key. Moreover, today's transaction also provides us the opportunity to buy the remaining 10 hotels under our original 26-hotel contract with Summit. This transaction shows that we are continuing to execute on our vision of driving long-term shareholder value through the creation of a best-in-class select-service portfolio with strong brands and durable cash flows."