Deutsche Bank Mexico, S.A., Banking Institution, Trust Division F/1616 or Fibra Inn (BMV:FINN13) , a Mexican real estate investment trust specializing in the hotel industry serving the business traveler, announced the acquisition of Hotel Mexico Plaza Silao, in the state of Guanajuato, which will be the fourth hotel to be converted to Wyndham Garden.
The acquisition price, was Ps. 80 million, plus Ps. 11.2 million in order to pay taxes and expenses related to the acquisition. Fibra Inn’s internal committees approved the purchase of this property, at a projected cap rate of 10%. The acquisition was paid with a second temporary credit line contracted with Banorte, which is expected to be refinanced once the Company formalizes the contract, currently under negotiation. This is a temporary credit line of Ps. 500 million, at a TIIE rate of 2.5 points, for 180 days and without commission.
The conversion to the Wyndham Garden Brand is expected to conclude by the last quarter of 2014. This property has 143 rooms, will operate under the limited service segment; and will be supervised by Fibra Inn under a sub-management structure with the current Hotel Operator.
During 2013, occupancy was 31%, with and average daily rate of Ps. 586.2 and RevPar of Ps. 181.7.
Fibra Inn opted to purchase this hotel for the following reasons:
- As we have previously mentioned, the Bajio region is a strategic area with high growth, and great lodging demand, mainly driven by the automotive industry along with the economic activity that this region generates. Foreign investment has benefited occupancy and room rates, as well as demand for group rates and events.
- This city only has 3 chain hotels: one Holiday Inn Express, one México Plaza and one Citi Express.
- This hotel is under an improvement phase, which will be accelerated once the conversion to Wyndham Garden takes place.
- This hotel is strategically located in front of the Bajio Airport and within 4 kilometers distance from the Puerto Interior complex, which is an industrial park with specialized terminals in train cargo with internal customs.
With this acquisition, Fibra Inn has 23 hotels in its portfolio, plus three under development, with a total of 4,644 rooms, of which 3,746 are currently in operation.
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