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Wyndham Defaults on Rents Due Hospitality Properties Trust |
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NEWTON, Mass.--(BUSINESS WIRE)--April 2, 2003--Wyndham International, Inc. (AMEX: WBR) failed to pay the rent due on April 1, 2003 to Hospitality Properties Trust (NYSE: HPT). |
HPT owns 27 hotels that are leased to Wyndham under two combination leases:
-- One lease for 15 Summerfield by Wyndham hotels requires minimum rent of $2,083,333/month.
-- A second lease for 12 Wyndham hotels requires minimum rent of $1,527,083/month.
HPT was holding security deposits for both leases totaling $33.3 million. The notice of default which HPT forwarded to Wyndham earlier today announced that HPT will retain these deposits against the damages it may incur under the leases for lost rent or otherwise.
Each of the two leases from HPT is to a so called "bankruptcy remote" subsidiary of Wyndham. The franchise and management contracts for all 27 of these hotels are subordinated to Wyndham's lease obligations to HPT. Accordingly, HPT has the right to rebrand these hotels.
HPT stated that it is unclear at this time whether Wyndham has decided to withhold the rents due HPT because it is unable to pay or as a negotiating tactic in order to seek changes in the lease terms.
Hospitality Properties Trust is a real estate investment trust headquartered in Newton, Massachusetts which owns 251 hotels located throughout the United States.
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