Summit Hotel Properties, Inc. (NYSE: INN) (the "Company") today announced that it has closed on three previously announced acquisitions and completed the disposition of five hotels.
The Company has closed on three previously announced acquisitions, the 213-guestroom Hyatt Place located in Minneapolis, MN, the 182-guestroom Hilton Garden Inn located in Houston, TX and the 98-guestroom Hampton Inn located in Santa Barbara (Goleta), CA.
The Company acquired the recently completed 213-guestroom Hyatt Place located in downtown Minneapolis on December 31, 2013 for a total purchase price of $32.6 million and entered into a management agreement with a Hyatt affiliate. The Company had previously funded $20.3 million (plus accrued interest) in the form of a first lien mortgage loan and completed the acquisition with an additional $12.0 million cash funded. The Company anticipates an estimated forward capitalization rate in the range of 8.00 percent to 9.00 percent based on management's current estimate of the Hotel's 2015 stabilized net operating income.
"We are thrilled with the completion of the Hyatt Place in downtown Minneapolis. The combination of location and amenities that this hotel provides make it a perfect addition to our portfolio and will create tremendous near-term and long-term shareholder value," said Company President and CEO Dan Hansen. "Seeing what began as just a vision several years ago come to fruition is an outstanding example of the hard work and dedication by our team. We look forward to the continued growth of our relationship with the Hyatt brand and further expansion of our presence in Minneapolis and other urban and densely populated suburban markets."
On January 9, 2014 the Company acquired the 182-guestroom Hilton Garden Inn located in Houston, TX for a purchase price of $37.5 million, which included $17.9 million in assumed mortgage debt. The hotel was built in 2005 and the Company anticipates spending approximately $3.1 million in capital improvements over the next twelve months. The Company anticipates a post-renovation estimated NTM capitalization rate in the range of 8.75 percent to 9.50 percent based on management's current estimate of net operating income.