(By Balaseshan) Summit Hotel Properties Inc. (NYSE: INN), a real estate investment trust and a hotel investment company, said it has closed purchase of three additional hotels in Utah, New York, and Florida for $71.8 million.
The company acquired 178-room Residence Inn by Marriott in Salt Lake City, Utah for $20.0 million. INN anticipates a post-renovation estimated NTM EBITDA multiple in the range of 10.5x to 11.5x based on management's current estimate of EBITDA.
Summit Hotel expects to spend about $6.5 million for improvements at the Utah hotel. The acquisition of this property was announced September 26, 2012 concurrent with the company's offering of common stock and the purchase closed on December 21.
The company bought 122-room Hyatt Place in Long Island (Garden City), New York for $31.0 million. It anticipates a post-renovation estimated NTM EBITDA multiple in the range of 11.0x to 12.0x based on management's current estimate of EBITDA. The company expects to spend about $305,000 for improvements at the hotel and the purchase closed on December 27.
Summit Hotel purchased 138-room Hampton Inn & Suites in Tampa, Florida for $20.8 million. The company anticipates a post-renovation estimated NTM EBITDA multiple in the range of 10.5x to 11.5x based on management's current estimate of EBITDA. It expects to spend about $2.0 million for improvements at the hotel and the purchase closed on December 27.
The company also announced the closing of the sale of the 92-room Courtyard by Marriott hotel in Missoula, Montana on December 11 for a price of $7.65 million.
Improvements at these hotels are anticipated to occur within the next 18 months. These improvements are expected to be funded with available cash or additional borrowings under the company's senior secured revolving credit facility.
The company also announced further consolidation into the executive office in Austin, Texas. Its President and CEO Dan Hansen, Chief Operating Officer Craig Aniszewski, Chief Financial Officer Stuart Becker and Chief Accounting Officer Troy Hester are all located in Austin. The Sioux Falls, South Dakota office remains open with key accounting and administrative personnel.
INN is trading up 2.11% at $9.70 on Wednesday. The stock has been trading between $7.40 and $10.16 for the past 52 weeks.