Summit Closes Acquisition of San Francisco Hotel
AUSTIN, Texas -- February 13, 2013
Summit Hotel Properties (NYSE: INN) (“the Company”) announced today it has
closed on the joint venture transaction for the acquisition of a 252-room
Holiday Inn Express® property (the “Hotel”) located on Fisherman’s Wharf in
San Francisco, CA.
The Company has acquired the Hotel from an unaffiliated seller for a purchase
price of $60.5 million through a joint venture with an affiliate of IHG
(InterContinental Hotels Group). The Hotel joins the 10 IHG-branded hotels in
the Company’s portfolio, including the Holiday Inn Atlanta-Gwinnett Place and
the Staybridge Suites Denver that were previously acquired under our current
sourcing agreement. The joint venture gives the Company an approximate 80%
ownership interest in the Hotel, which will be operated under a long-term IHG
management agreement. The Company currently expects the joint venture to spend
an aggregate of approximately $3.0 million for improvements at the Hotel
within the next 12 months. The Company anticipates a post-renovation estimated
NTM EBITDA multiple for the Hotel in the range of 11.0x to 12.0x based on
management’s current estimate of EBITDA.
“We are excited about the opportunity to enter the San Francisco market,” said
Dan Hansen, president and CEO of the Company. “We are also very pleased that
our relationship with IHG has provided us with the opportunity to source
quality acquisitions like this and we expect to continue our growth with
The Hotel is perfectly positioned in the heart of the wharf district in the
midst of the bustling waterfront area. Leisure guests can spend a sunny day at
Pier 39, take a tour of Alcatraz or grab a ride on one of San Francisco’s
iconic trolleys. Fisherman's Wharf also offers souvenir shopping and
world-class seafood. Business travelers will enjoy the proximity to the
corporate offices of Levi Strauss, Williams-Sonoma, Diversity Alliance and
others in nearby downtown San Francisco. The Hotel's location is also near the
Financial District, Art Institute and Academy of Art University. And, all
guests are able to enjoy the complimentary Express Start® breakfast bar option
before beginning their day.
“The strategic relationship with Summit Hotel Properties continues to drive
value for our business in strong US market such as San Francisco. We are
pleased to see the completion of this transaction and start of a new long-term
management agreement for our successful Holiday Inn Express brand,” said Kirk
Kinsell, president, Americas, IHG. “This joint venture purchase with Summit is
yet another example of us delivering consistently on our asset strategy, as
well as working with high quality ownership groups who have confidence in our
brands and management expertise.”
Features of the Hotel are in line with the $1 billion Holiday Inn® brand
family’s global brand relaunch, which was the largest project of its kind ever
in the hospitality industry. The relaunchprogram has created a more
contemporary brand image, including redesigned logo and signage, as part of
the drive to increase the portfolio’s quality and consistency around the
world. Business and leisure guests to a Holiday Inn Express hotel will enjoy
signature details in areas that were a key focus of the relaunch including:
arrival and welcome services, guestroom and guest bath comfort.
About Summit Hotel Properties, Inc.:
Summit Hotel Properties, Inc. is a self-advised real estate investment trust
focused on acquiring and owning premium-branded select-service hotels in the
upscale and upper midscale segments. As of February 13, 2013, the Company’s
hotel portfolio consisted of 87 hotels, containing a total of 9,635
guestrooms, located in 22 states.
This press release contains statements that are “forward-looking statements”
within the meaning of the Private Securities Litigation Reform Act of 1995 and
other federal securities laws. These forward-looking statements are based upon
the Company’s expectations, but these statements are not guaranteed to occur.
Investors should not place undue reliance upon forward-looking statements.
These statements relate to, among other things, the Company’s pending
acquisitions, the availability of funding for the pending acquisitions and the
expected increase in the maximum borrowing availability under the Credit
Facility. No assurance can be given that the acquisitions will be completed
when expected, on the terms described or at all, or that maximum borrowing
availability under the Credit Facility will be increased. These actions are
subject to numerous conditions, many of which are beyond the control of the
Company, including, without limitation, general economic conditions, market
conditions and other factors, including those set forth in the Risk Factors
section of the Company’s periodic reports and other documents filed with the
Securities and Exchange Commission (the “SEC”).Copies are available on the
SEC’s website, www.sec.gov. The Company undertakes no obligation to update
these statements after the date of this release.
About Holiday Inn Express®
Holiday Inn Express hotels are modern hotels for value-oriented travelers.
Fresh, clean and uncomplicated, Holiday Inn Express hotels offer competitive
rates for both business and leisure travelers. Guests Stay Smart^® at Holiday
Inn Express hotels where they enjoy a free hot Express Start^® Breakfast Bar,
free high-speed internet access and free local phone calls (US and Canada
only). There are currently more than 2,000 Holiday Inn Express hotel locations
around the globe. For more information about Holiday Inn Express hotels or to
book reservations, call 1-800-HOLIDAY or visit www.hiexpress.com.
IHG® (InterContinental Hotels Group) [LON:IHG, NYSE:IHG (ADRs)] is a global
organization with nine hotel brands including InterContinental® Hotels &
Resorts, Hotel Indigo®, Crowne Plaza® Hotels & Resorts, Holiday Inn® Hotels &
Resorts, Holiday Inn Express®, Staybridge Suites®, Candlewood Suites®, as well
as our two newest brands, EVEN™ Hotels and HUALUXE™ Hotels and Resorts. IHG
also manages Priority Club® Rewards, the world’s first and largest hotel
loyalty program with over 69 million members worldwide.
IHG franchises, leases, manages or owns over 4,500 hotels and more than
672,000 guest rooms in nearly 100 countries and territories. With more than
1,000 hotels in its development pipeline, IHG expects to recruit around 90,000
people into additional roles across its estate over the next few years.
InterContinental Hotels Group PLC is the Group’s holding company and is
incorporated in Great Britain and registered in England and Wales.
Visitwww.ihg.comfor hotel information and reservations
andwww.priorityclub.com for more on Priority Club Rewards. For our latest
Summit Hotel Properties, Inc.
Dan Boyum, 512-538-2304
VP of Investor Relations
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