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Summit Hotel Properties, Inc. (NYSE: INN) (the “company”), a real estate investment trust (REIT) specializing in the ownership of premium-branded, select-service hotels in the upscale and upper midscale segments, today announced the closing of the company’s eleventh hotel acquisition since its February 2011 initial public offering as well as the sale of two land parcels in Boise, ID.
The company acquired an 83-room Hampton Inn & Suites in Nashville (Smyrna), TN for a purchase price of $8.0 million. In addition to the purchase price, the company expects to spend approximately $0.5 million for improvements at the hotel. The company anticipates a post-renovation estimated NTM capitalization rate based on management’s current estimate of EBITDA for the twelve-month period ending June 30, 2013 in the range of 8.5 to 9.5 percent.
“This Hampton Inn & Suites is a textbook acquisition for us,” said Dan Hansen, company president and CEO. “It hits all the points of our simple goal of acquiring top brands in top markets at great cap rates. This hotel also gives us the added advantage of clustering properties as we’ve demonstrated in many markets across the country. We’re excited about the Nashville market, and this hotel and the Hilton Garden Inn we acquired last month in the same market are both great additions to our portfolio. This consistent execution of our strategy is how we provide value to our investors. ”
Two parcels of land adjacent to the company’s properties in Boise, ID have been sold to Boise State University for use as an off-campus Park & Ride facility. Net proceeds of approximately $1.4 million will be used to reduce outstanding debt. “This sale reflects our commitment to cultivating and improving our asset base to maximize total return for our investors,” said Hansen. “This conservative, disciplined approach helps us continue on our path of steady, orderly growth of our portfolio through accretive acquisitions and strategic dispositions of non-core assets.”