All of the five hotels in Latin America were recently built or renovated and four of these five hotels are located in the capital cities of Mexico, Chile, Colombia and Uruguay1. The four hotels which will be the collateral for HPTs mortgage loans are each full service hotels, well located in the city centers of Madrid, Barcelona, Amsterdam and Brussels. The NYC hotel is located in Mid-Town Manhattan
Hospitality Properties Trust (NYSE: HPT) announced that it has entered a letter of intent and an exclusive negotiating period for hotel investments with NH Hoteles, SA (BME: NHH) (NYSE: NHHEY (ADRs)) in Latin America, Europe and the USA totaling approximately US $375 million.
The outline of terms which have been negotiated between HPT and NHH is as follows:
NH Hoteles is one of the leading hotel management companies in the world. NH Hoteles operates approximately 400 hotels in Europe and Latin America, and it is simultaneously today announcing a strategic investment by HNA Group of China into NH Hoteles. HPT began its discussions with NH Hoteles almost one year ago and HPT hopes that, when the transaction outlined in the letter of intent announced today is implemented, it will be the beginning of a long term strategic relationship between our companies, especially in North and South America and possibly elsewhere.
The hotels in which HPT will be invested are all well located, market leading hotels. All of the five hotels in Latin America were recently built or renovated and four of these five hotels are located in the capital cities of Mexico, Chile, Colombia and Uruguay1. The four hotels which will be the collateral for HPT’s mortgage loans are each full service hotels, well located in the city centers of Madrid, Barcelona, Amsterdam and Brussels. The NYC hotel is located in Mid-Town Manhattan; when it is fully renovated it will be operated to top tier brand standards of both NH Hoteles and Sonesta, and HPT expects that the joint marketing programs to be developed by NH Hoteles and Sonesta will promote the hotel’s financial success as a “flagship” type asset for both managers.
The letter of intent announced today is detailed, but it is only an expression of current intents and not a binding agreement. HPT’s and NHH’s obligations to undertake this transaction are conditioned upon their agreement to and entry of final transaction documents and other matters. Also, because the transaction described in the letter of intent involves multiple hotels in multiple legal jurisdictions, it is expected that it may be implemented in a series of closings. At this time, HPT expects this transaction may be fully completed during the summer of 2013.
HPT was represented in the negotiation of the transaction announced today by Morgan Stanley.
Hospitality Properties Trust is a real estate investment trust, or REIT, which as of December 31, 2012, owned or leased 289 hotels and 185 travel centers located in 44 states, Puerto Rico and Canada. HPT is headquartered in Newton, Massachusetts, USA.
1 The fifth Latin America hotel is also in Mexico.
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