Ashford Hospitality Trust, Inc. (AHT - Free Report) announced that it has sold Residence Inn Tampa Downtown in Tampa, FL. This 109-room property was sold for $24 million or $220,000 per key.
As of Mar 31, 2018, the hotel’s EBITDA multiple of 11.8x and a 12-month trailing cap rate of 7.6% on its net operating income was represented in the sales price.
Further, revenues per available room achieved by the hotel for the 12-month period (ended Mar 31, 2018) was $122, with occupancy of 76%. The average daily rate was $161.
The Residence Inn Tampa’s standing-debt balance of $19.5 million was settled prior to closing. Additionally, the debt pay-down amount of $2.9 million, relating to the release of the hotel from the loan pool, was paid off too.
Notably, the company has opted to be a net seller and has not acquired any hotels since 2015. In fact, the company has sold about $350 million of hotels over this period. During first-quarter 2018, Ashford Hospitality sold SpringHill Suites Glen Allen for $10.9 million and towards the end of the quarter, it also disposed SpringHill Suites Centreville for $7.5 million.
The President and chief executive officer of Ashford Trust, Douglas A. Kessler informed, "The Residence Inn Tampa transaction demonstrates our value-added approach given pricing was at an attractive cap rate compared with our current market valuation." He also feels that the above-mentioned sale is in sync with the company’s efforts to improve returns for shareholders, using their strategies of investing opportunistically in upper-upscale, full-service hotels in the hospitality industry.
Encouragingly, in the past year, this Zacks Rank #3 (Hold) stock has outperformed the industry. While the company’s shares have gained 26.2%, the industry has recorded 2.7% rise.
Stocks Worth a Look
A few better-ranked stocks from the same space include Arbor Realty Trust (ABR - Free Report) , Prologis, Inc. (PLD - Free Report) and Host Hotels & Resorts, Inc. (HST - Free Report) . All three stocks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Arbor Realty Trust’s Zacks Consensus Estimate for 2018 FFO per share rose 14.4% to $1.03 over the past month. Its shares have returned 15.8% in the past three months.
Prologis’ FFO per share estimates for the current year inched up 1.7% to $2.96 in a month’s time. Its shares have gained 6% over the past three months.
Over the past month, Host Hotels & Resorts’ FFO per share estimates for 2018 witnessed rise of 3% and moved to $1.71. The stock has gained 6.1% in the past three months.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Click here for the 6 trades >>