Park Hotels & Resorts Inc. Closes Sale of the Le Meridien New Orleans for $84 Million ($205 per key)
Park Hotels & Resorts Inc. ("Park") (NYSE:PK) today announced that it has closed on the sale of the 410-room Le Meridien New Orleans (the "Hotel") located in New Orleans, LA, for gross proceeds of $84.0 million, or $205,000 per key before customary closing costs. When adjusted for Park's anticipated capital expenditures ("capex"), the sale price represents a 5.0% capitalization rate on the Hotel's projected 2019 net operating income, or 17.1x the Hotel's projected 2019 EBITDA. Proceeds from the sale of the Hotel will be used to repay a portion of Park's unsecured indebtedness.
Including the sales of the Conrad Dublin and the Ace Hotel Downtown Los Angeles, Park has now sold three assets in the fourth quarter 2019 for pro rata gross proceeds of $262.0 million. When adjusted for Park's anticipated capex, the aggregate sales price represents a gross multiple of 17.3x on Park's projected 2019 EBITDA for the three properties combined. Net proceeds from the sales will be used to reduce a portion of Park's unsecured indebtedness.
"We are extremely pleased to close on another non-core asset sale and further de-lever the balance sheet, having materially improved our net leverage in just three months," commented Thomas J. Baltimore, Jr., Chairman and Chief Executive Officer of Park. "With the sale of the Le Meridian New Orleans we have now sold, or otherwise disposed of, 22 non-core assets for $1.0 billion since our spin from Hilton as we continue to make progress against our strategic plan to improve the quality of our portfolio by exiting international and slower growth domestic markets."