Park Hotels & Resorts Inc. announced that it closed on the sales of three non-core domestic assets for combined gross proceeds of $166.0 million, or $151,000 per key.
The three hotels, the 507-room Hilton Atlanta Airport in Atlanta, Georgia; the 317-room Hilton New Orleans Airport in New Orleans, Louisiana; and the 274-room Embassy Suites Parsippany in Parsippany, New Jersey, are located in non-core airport and suburban markets and had a combined 2018 RevPAR of $109, or approximately 37% below Park’s 2018 portfolio average. When adjusted for Park’s anticipated capital expenditures of $50.5 million, or $46,000 per key, the combined sale price represents a 6.9% capitalization rate on the three hotels’ 2018 net operating income, or 12.6x the hotels’ 2018 EBITDA.
“I am extremely pleased with our continued progress on our capital recycling efforts, having now sold 18 non-core assets for over $750 million since our formation in 2017,” commented Thomas J. Baltimore, Jr., Chairman and Chief Executive Officer of Park. “As previously disclosed, proceeds from the sales of these three assets will help to meaningfully reduce our net leverage ahead of the recently announced proposed merger with Chesapeake Lodging Trust.”