Ashford Hospitality Trust has signed a definitive agreement to sell the 144-room Residence Inn in Salt Lake City for $19.2 million. Other terms of the transaction were not disclosed. The sale is expected to be completed in early March and is subject to normal closing conditions. The company provides no assurances that the sale will be completed on these terms or at all.
When adjusted for the company's anticipated capital expenditures, the sale price represents a 4.6 percent capitalization rate on 2023 net operating income, or 18.2x 2023 hotel earnings before interest, taxes, depreciation or amortization. Excluding the anticipated capital spend, the sale price represents a 6.0 percent capitalization rate on 2023 net operating income, or 14.0x 2023 Hotel EBITDA. All of the proceeds from the sale are expected to be used to pay down debt.
"We are pleased to announce the signed agreement to sell the Residence Inn Salt Lake City at a very attractive cap rate," Ashford President and CEO Rob Hays said in a statement. "We continue to have several assets in the market at various stages of the sales process and look forward to providing more updates in the coming weeks."