Park Hotels & Resorts Inc. (NYSE:PK) yesterday announced that it has closed on the sale of the 152-room Hilton Nuremberg hotel located in Nuremberg, Germany for gross proceeds of $17.5 million, or $115,000 per key.
When adjusted for Park’s anticipated capital expenditures (“capex”) of $10.1 million for the Hotel, the sale price represents a 3.5% capitalization rate on the Hotel’s 2018 net operating income (5.6% excluding capex), or 21.2x (13.4x excluding capex) the Hotel’s 2018 EBITDA. Proceeds from the sale will be used for general business purposes, which may include funding future capital projects. Park has now sold 15 non-core assets for nearly $590 million over the last 18 months.
“I am thrilled with the progress we have made on our non-core asset sales, with this latest transaction reducing our international exposure to just three hotels, accounting for approximately 1% of Hotel Adjusted EBITDA. The sale also further improves the overall quality of our portfolio, as the Hotel’s 2018 RevPAR was $105, or 40% below our portfolio average. We remain laser-focused on reshaping our portfolio and maximizing value for our stockholders and anticipate executing on additional asset sales in the future,” commented Thomas J. Baltimore, Jr., Chairman and Chief Executive Officer of Park.
Park Hotels & Resorts Inc. (NYSE: PK) is the second largest publicly traded lodging real estate investment trust with a diverse portfolio of market-leading hotels and resorts with significant underlying real estate value. Park’s portfolio currently consists of 51 premium-branded hotels and resorts with over 30,000 rooms located in prime U.S. markets with high barriers to entry.