Holloway Lodging Corp has acquired a controlling interest in the Super 8 hotel located in St. John's, Nfld. Holloway paid approximately $2.1 million in cash for a 35-percent interest in the economy property. Together with its previously held 18-percent interest, Holloway now owns 53 percent of the property.
The aggregate purchase price paid by Holloway for its 53-percent interest implies a cap rate of 11.6 percent based on trailing 12-month net operating income and a price per room of approximately $113,000, substantially below the cost of replacement.
As the capital of Newfoundland and Labrador, the St. John's economy benefits from government, educational and medical services as well as the offshore petroleum industry and the development of the emerging Muskrat Falls hydroelectricity project. The hotel was built in 2005 and has 81 rooms, a meeting room and fitness center.