Hersha Acquires Hampton Inn and Holiday Inn for $39.5 mil
PHILADELPHIA, PA, June 6, 2006. Hersha Hospitality Trust (AMEX: HT) announced that it has entered in definitive agreements to purchase two hotels on Long Island from a leading New York-based hotel developer, Long Island Hotels, LLC, for a total of $39.5 million.
The purchase includes a six-story 161-room Hampton Inn in Farmingville, New York for $21.5 million comprising cash and the assumption of $15.5 million in debt, bearing a 6.4% fixed rate of interest. The hotel is located at Exit 63 on the Long Island Expressway minutes from MacArthur Airport.
The Company's purchase of a seven story 133-room Holiday Inn Express in Hauppauge, New York is located at Exit 56 on the Long Island Expressway near the entrance of a 1,400-acre Industrial Park for $18 million. The sale was comprised of cash and the assumption of $10.6 million in debt, bearing a 5.7% fixed rate of interest.
Jay H. Shah, Chief Executive Officer commented, "These acquisitions further our presence in the Long Island market. This region of New York provides a strong platform for growth in a high barrier to entry market, as land for development is becoming more scarce and new construction extremely expensive. Securing these assets through a relationship we hope will expand in the coming years, with one of the premier developers on Long Island, enables us to purchase two hotels that are in great physical condition and have irreplaceable locations that are attractive to corporate travelers as well as tourists. The location and demand for these two hotels makes these assets an excellent fit with our comprehensive corporate strategy of owning strong assets along the Northeast corridor from Boston to Virginia."
The hotels are currently managed by Long Island Hotels, LLC.
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