Condor Hospitality Trust Inc., a hotel-focused real estate investment trust headquartered and incorporated in the state of Maryland, has closed on two deals in the past week. The first was on the acquisition of two Marriott-branded hotels for $38.8 million. The closing includes the following hotels: the Fairfield Inn & Suites El Paso Airport and the Residence Inn Austin Airport. The second was on the sale of a legacy hotel asset, the 81-room Quality Inn Morgantown located at 225 Comfort Inn Dr., Morgantown, WV 26508 for $2.6 million. Net proceeds from the sale will be applied to outstanding debt on the Company’s $150 million secured credit facility.
The Marriott-branded hotels will continue to be managed by Ambridge Hospitality. The company has a third Marriott-branded hotel, the TownePlace Suites Austin North Tech Ridge, under contract for $19.7 million, which is expected to close in the first quarter of 2018.
“With the closing of the Fairfield Inn & Suites El Paso Airport and the Residence Inn Austin Airport, we have now closed since the fourth quarter of 2015 approximately $240 million of acquisitions representing 12 high-quality premium-branded select-service hotels consisting of a total of 1,593 rooms. These two most recently acquired hotels, with an average age of less than two years and branded under two high-quality Marriott flags, fit squarely within our investment strategy of acquiring premium-branded select-service assets in attractive secondary markets,” stated Bill Blackham, Condor’s Chief Executive Officer.
He explains that “Our extremely disciplined assemblage of a very high-quality portfolio of select-service hotels has led to strong RevPAR outperformance over the national averages, as demonstrated by our 7.4% RevPAR year-over-year growth in the first half of 2017 for our new investment platform hotels. Additional highlights of this transaction are that we closed the acquisition in 46 days, that we expanded our management company relationships with the addition of Aimbridge Hospitality, and that we remain under contract to acquire the TownePlace Suites Tech Ridge, expected to close in the first quarter of 2018,” added Mr. Blackham.
Blackham points out that the 81-room Quality Inn sale represents the company’s sixth legacy hotel sale in 2017 as part of its ongoing capital recycling initiative. “The six year-to-date hotel dispositions result in our objective of selling seven legacy hotel assets during 2017 being 85% completed and the closed sales have generated gross proceeds of approximately $22.7 million. Condor currently has only seven remaining legacy assets with one of these assets currently under contract for sale, though there can be no guarantee this disposition will actually close.”