MHI Hospitality Corporation (NASDAQ: MDH) (the “Company”) announced today that the Company has entered into an agreement with the holders of the Company’s Series A Cumulative Redeemable Preferred Stock (the “Preferred Stock”) to redeem 1,901.547 shares of Preferred Stock for an aggregate redemption price of approximately $2.1 million plus the payment of accrued and unpaid cash and stock dividends.
The Company also announced that it amended the original $8.0 million mortgage secured by its Doubletree by Hilton Brownstone-University hotel with its existing lender, Premier Bank, Inc. With the amendment, the loan’s principal amount is increased to $10.0 million. The mortgage’s interest rate will remain at 5.25% and the loan was amended to remove any prepayment penalty. Per the above, proceeds from the loan amendment were used to redeem a portion of the Preferred Stock. This combined transaction results in a normalized annual interest expense savings of approximately $115,000 to the Company.
MHI Hospitality Corporation is a self-managed and self-administered lodging REIT focused on the acquisition, renovation, upbranding and repositioning of upscale to upper upscale full-service hotels in the Mid-Atlantic and Southern United States. Currently, the Company’s portfolio consists of investments in ten hotel properties, nine of which are wholly-owned and comprise 2,113 rooms. All of the Company’s wholly-owned properties operate under the Hilton Worldwide, InterContinental Hotels Group and Starwood Hotels and Resorts brands. The Company has a 25.0 percent interest in the Crowne Plaza Hollywood Beach Resort. MHI Hospitality Corporation was organized in 2004 and is headquartered in Williamsburg, Virginia. For more information please visit