It's the season for large portfolio sales, and Moody National REIT is reportedly in talks to buy a selection of 149 hotels for $1.725 billion.
According the Globe St., the portfolio in question includes 14,000 units across 32 states, though the majority of the properties are located in California, Arizona, Texas and the Northeast. Much of the portfolio consists of Marriott and Hilton-branded hotels. Moody also said it is subject to closing conditions, and cautioned that there is not yet assurance of the deal being finalized on the current terms.
"The hotel market has been flush with portfolio deals during this cycle, with deals ranging from two-property limited service portfolios in secondary/tertiary markets, all the way on up to 150-property deals,” Evan Weiss, executive managing director, principal, LW Hospitality Advisors, told Globe St. “This transaction comes on the heels of a 50-property economy-class portfolio being purchased by Starwood Capital just the other day for inclusion in its InTown Suites brand. There is clearly a consolidation of assets into large entities, both public and private, and a healthy appetite for both buyers, sellers and financiers."
Though the seller of the hotels was not identified by Moody, Bloomberg reported that the properties are being unloaded by Goldman Sachs' real estate unit, Whitehall Street. After the acquisition, Moody's assets under management will increase to roughly $2.5 billion.
“We still think there are several years left in the hotel cycle,” Moody told Bloomberg. “The portfolio is poised to take advantage of increased demand with continued lack of supply.”