RLH Corp. entered into nonbinding sales agreements for three of its hotels—the 246-room Red Lion Hotel Atlanta Airport, the 99-room Hotel RL Washington DC and the 394-room Hotel RL Salt Lake City—for an aggregate $64 million in gross proceeds. The transactions, which are subject to due diligence, financing contingencies and customary closing conditions, are expected to close by the end of the year.
“These transactions are a continuation of our real estate marketing and disposition program as we focus on our franchise and branding strategy,” Greg Mount, CEO of RLH Corp., said in a statement. “We are encouraged by the renewed interest in our remaining owned hotels and will continue to work to successfully close on those assets in a manner that maximizes their value.”
The Red Lion Hotel Atlanta will not retain the Red Lion flag. The Hotel RLs in Washington, D.C., and Salt Lake City will retain their flags during a transition period as the new property owners pursue a change in use. In addition to these three agreements, RLH Corp. is also continuing its process to secure the sale of the Red Lion Hotel Anaheim Resort in California.
Each of the three properties is held in a joint venture, of which RLH Corp. owns 55 percent. The company plans to use the net proceeds from the sale to repay property-level and corporate-level debt. It estimates the net proceeds will be between $35 million and $45 million.