JACKSONVILLE, FL— MHI Hospitality Corp. has entered into an agreement to acquire the Hilton Jacksonville Riverfront here for $22 million.
The Hilton Jacksonville is a 292-room property that overlooks the St. John’s River and includes two restaurants, highlighted by a Ruth’s Chris Steak House; 12,000 sf of meeting space; a fitness center; and an outdoor pool. Additionally, an 80-foot charter boat, the Jacksonville Princess Yacht, is available for private and public cruises.
“The Hilton Jacksonville is a performing asset in an attractive market and has the potential to provide positive returns to our shareholders,” said MHI Hospitality CEO Andrew Sims.
The hotel will be managed by MHI Hotels Services LLC, which currently manages MHI’s six existing hotels and has managed the Hilton Jacksonville since 1996.
The purchase price will be funded in part by an $18-million first mortgage loan. An affiliate of the seller, the AFL-CIO Building Investment Trust, has agreed to provide the mortgage financing subject to certain conditions. An affiliate of MHI Hotels Services currently leases the hotel and will contribute certain personal property and assign contract and other rights relating to the property to MHI in exchange for operating partnership units valued at approximately $913,000. The remaining portion of the purchase price will be paid in cash, utilizing a portion of the proceeds from the company’s initial public offering. After the acquisition, the company will pursue a $3-million capital improvement program for the hotel. Closing is anticipated for either late in the second or third quarter.
