NEW YORK— According to a Reuters report, Hospitality Properties Trust ended a lease for 15 of Wyndham International Inc.s Summerfield Suites hotels because of a default, and is in talks with Wyndham over operations at another 12 hotels. Wyndham said its Summerfield HPT Lease Co. unit agreed to terminate the lease for the 15 hotels because the cost was “extraordinarily high,” having been negotiated at the peak of the hotel market. HPT, a Newton, Massachusetts-based real estate investment trust which owns 251 hotels, had on April 2 declared Wyndham, which is based in Dallas, in default of two leases covering the hotels. One affected the 15 Summerfield hotels and called for a $2.1 million minimum monthly rent. The other affected 12 Wyndham hotels with a minimum $1.5 million monthly rent. HPT said it also retained a $33 million security deposit. Wyndham Chief Executive Fred Kleisner said in a statement that termination of both leases would cause Wyndham units cash flow to rise about $14.3 million a year, and result in a $150 million non-cash writeoff of the leases remaining book value. HPT said that starting on Monday, the 15 Summerfield hotels are being operated on Hospitalitys behalf under a management agreement by Candlewood Hotel Co. HPT, a real estate investment trust, said it is in talks with Wyndham about retaining the Summerfield brand at these hotels for at least a transitional period. It said it has not yet decided whether to retain the Wyndham brand on the other 12 hotels. SOURCE: Reuters
