Equity Inns Expands Presence in California and Texas
11 May 2007 - 5:02AM
Business Wire
Equity Inns, Inc. (NYSE: ENN), the third largest hotel real estate
investment trust (REIT), today announced that the Company has
signed agreements to purchase five Marriott branded hotels for a
total price of $114.2 million from partnership�s controlled by the
principals of Huntington Hotels. The properties are being purchased
at an average capitalization rate of 8.6% based upon trailing
twelve months net operating income. The proposed purchase includes
the assumption of $56.5 million debt at a blended cost of 6.1%.
Huntington Hotels, which currently manages the Carlsbad Courtyard
in San Diego for Equity Inns, will retain management of the
properties under performance based contracts. The five properties,
with an average age of seven years, include a 150-suite Residence
Inn at the Los Angeles International Airport; a 95-suite Residence
Inn and 137-suite SpringHill Suites in San Diego; a 184-room
Courtyard and 116-room Fairfield Inn & Suites located directly
across from the Dallas Market Center. Upon closing, the purchase
will extend Equity Inns� investment in the Southern California and
Dallas metropolitan areas. Mr. Howard A. Silver, President and
Chief Executive Officer, commented, �We are pleased to build on our
relationship with Huntington Hotel Group, a strong manager with an
active development pipeline of premium, select service projects.
Additionally, we are excited about increasing our presence in the
high barrier markets of Los Angeles and San Diego.� About Equity
Inns Equity Inns, Inc. is a self-advised REIT that focuses on the
upscale extended stay, all-suite and midscale limited-service
segments of the hotel industry. The Company, which ranks as the
third largest hotel REIT based on number of hotels, currently owns
132 hotels with 15,731 rooms located in 35 states. For more
information about Equity Inns, visit the Company's Web site at
www.equityinns.com. Forward Looking Statements Certain matters
discussed in this press release which are not historical facts are
�forward-looking statements� within the meaning of the federal
securities laws and involve risks and uncertainties. The words
�may,� �plan,� �project,� �anticipate,� �believe,� �estimate,�
�forecast, �expect,� �intend,� �will,� and similar terms are
intended to identify forward-looking statements, which include,
without limitation, statements concerning our outlook for the hotel
industry, acquisition and disposition plans for our hotels and
assumptions and forecasts of future results for fiscal year 2007.
Forward-looking statements are not guarantees of future performance
and involve numerous risks and uncertainties which may cause our
actual financial condition, results of operations and performance
to be materially different from the results of expectations
expressed or implied by such statements. General economic
conditions, future acts of terrorism or war, risks associated with
the hotel and hospitality business, the availability of capital,
.risks associated with our debt financing, hotel operating risks
and numerous other factors, may affect our future results and
performance and achievements. These risks and uncertainties are
described in greater detail in our 2006 Annual Report on Form 10-K
filed on February 28, 2007, and our other periodic filings with the
United States Securities and Exchange Commission (SEC). We
undertake no obligation and do not intend to publicly update or
revise any forward-looking statement, whether as a result of new
information, future events or otherwise. Although we believe our
current expectations to be based upon reasonable assumptions, we
can give no assurance that our expectations will be attained or
that actual results will not differ materially. Non-GAAP Financial
Measures Included in this press release is the term Capitalization
Rate, a "non-GAAP financial measure", common in the hotel industry,
used by the Company to help discuss its underwriting of acquired or
disposed hotel assets. Capitalization rate, for this discussion, is
defined as the percentage derived by dividing the net operating
income of the hotel asset(s), less a management fee and an
allowance for recurring capital expenditures, by the purchase price
paid or received for the hotel asset(s).
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