Winston Hotels Closes on Loan for Hampton Inn & Suites in Murfreesboro, Tennessee; Sells Holiday Inn Select in Garland, Texas;
16 June 2006 - 6:06AM
Business Wire
Winston Hotels, Inc. (NYSE: WXH), a real estate investment trust
(REIT) and owner of premium limited-service, upscale extended-stay
and full-service hotels, today announced that it has closed on an
$8.5 million loan to finance the development of a 101-room Hampton
Inn & Suites in Murfreesboro, Tenn. The total estimated cost of
the project, which is being developed by Host Murfreesboro, LLC, is
$10.2 million. In addition, the company announced the sale of the
Holiday Inn Select in Garland, Texas and declared its regular
quarterly dividends. Hampton Inn & Suites Loan The $8.5 million
loan is part of Winston's debt financing program, which provides
loans to build, renovate or acquire hotels. The five-year loan
requires payments at an interest rate of 30-day LIBOR plus 3.60
percent, with another 1.0 percent of the original principal balance
accruing until the loan is paid in full. Payments are interest only
during construction of the hotel and the first 12 months of hotel
operations and thereafter include principle payments based on a
25-year amortization period. "The Murfreesboro project has a lot
going for it, including a premium brand and a prime location in an
urban market with solid growth potential," said Joe Green,
president and chief financial officer. "Winston's unique
combination of hotel experience and lending expertise made them an
attractive and logical source of funding for this project," said
Bryan Nearn, Chief Manager of Host Murfreesboro, LLC. The
four-story hotel will be located on the west side of Thompson Lane,
placing it between two Interstate 24 interchanges--Old Fort Parkway
and Medical Center Parkway. The property is within a short distance
of the downtown area, the main Murfreesboro exit and a new roadway
and growth corridor. Hotel Sale The company recently sold the
242-room Holiday Inn Select in Garland, Texas, a Dallas suburb, for
net cash proceeds totaling $4.4 million, resulting in a net gain on
sale of approximately $0.5 million. Proceeds were used to pay down
a portion of the company's outstanding indebtedness. "We continue
to refine our hotel portfolio, replacing older properties and those
that are no longer consistent with our long-term strategies with
new, more strategic assets," Green said. "We currently have three
hotels under construction and have an active acquisition pipeline."
Dividend Winston's board of directors declared the company's
regular quarterly cash dividend for the 2006 second quarter on its
common and preferred shares. The cash dividend of $0.15 per common
share is payable on July 14, 2006 to common shareholders of record
on June 30, 2006. Based on yesterday's closing price of $10.67 per
common share, the annualized dividend yield is 5.6 percent. The
board also declared a cash dividend of $0.50 per Series B
Cumulative Preferred share for the second quarter of 2006. The cash
dividend is payable on July 14, 2006, to preferred shareholders of
record on June 30, 2006. About the Company Currently, the company
owns or is invested in 54 hotel properties in 18 states having an
aggregate of 7,276 rooms. This includes 47 wholly owned properties
with an aggregate of 6,328 rooms, a 60 percent ownership interest
in a joint-venture that owns one hotel with 138 rooms; a 49 percent
ownership interest in a joint venture that owns one hotel with 118
rooms, a 48.78 percent ownership interest in a joint venture that
owns one hotel with 147 rooms, and a 13.05 percent ownership
interest in a joint venture that owns four hotels with an aggregate
of 545 rooms. Currently, the company also has hotel loan
commitments totaling $71.4 million. The company does not hold an
ownership interest in any of the hotels for which it has provided
financing. For more information about Winston Hotels, visit the
company's Web site at www.winstonhotels.com. Notes About
Forward-Looking Statements In addition to historical information,
this press release contains forward-looking statements. The reader
can identify these statements by use of words like "may," "will,"
"expect," "project," "anticipate," "estimate," "target," "believe,"
or "continue" or similar expressions, including without limitation
its acquisition, disposition and development plans for hotel
properties, its hotel lending plans, and its dividend policy. These
statements represent the company's judgment and are subject to
risks and uncertainties that could cause actual operating results
to differ materially from those expressed or implied in the forward
looking statements including, but not limited to, changes in
general economic conditions, lower occupancy rates, lower average
daily rates, acquisition risks, development risks including risk of
construction delay, cost overruns, occupancy and governmental
permits, zoning, the increase of development costs in connection
with projects that are not pursued to completion, the risk of
non-payment of subordinated loans, or the failure to make
additional hotel debt investments and investments in hotels. Other
risks are discussed in the company's filings with the Securities
and Exchange Commission, including but not limited to its Annual
Report on Form 10-K for the year ended December 31, 2005.
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