DALLAS— CNL Hotels and Resorts and Ashford Hospitality Trust, Inc. have reached a definitive agreement in which Ashford will acquire a 30-asset, 4,328-room hotel portfolio from CNL for $465 million in cash. The price would equate to a trailing 12-month net operating income capitalization rate of about 8.4%. The per room price for the entire portfolio is $107,000. Included in the portfolio are 13 Residence Inns, six Courtyards, seven TownePlace Suites and four SpringHill Suites. The average age of these assets is 8.9 years. In 2005, the portfolio’s combined occupancy improved by 340 basis points and reached 75.1%. The ADR increased 5.6% during that time, reaching $93.65, and the RevPAR jumped 10.5% up to $70.37. Ashford will fund the acquisition in several ways, including through a financing commitment from Merrill Lynch Mortgage Lending, Inc. worth $370 million. That commitment is locked at a fixed rate of 5.32%. Ashford will also use undrawn proceeds from Security Capital’s remaining convertible preferred or participation in Ashford’s January common stock offering, revolver capacity or cash on the balance sheet. Upon closing, Ashford will own 82 hotels with a combined total of 13,244 rooms. Marriott International will remain as the operator of the portfolio’s properties under an incentive management agreement.
