Park Hotels & Resorts Inc. (NYSE:PK) today announced that it has closed on the sale of the 601-room Hilton Berlin located in Berlin, Germany, for gross proceeds to the joint venture owners of the entities that own the Hotel of €297 million, before customary closing adjustments. The gross proceeds equate to approximately $350 million, or $583,000 per key. Park’s pro rata share of gross proceeds was approximately $140 million. The sale price represents an EBITDA multiple of approximately 20x the Hotel’s 2017 EBITDA.
The sale of the Hotel marks the 13th hotel that Park has sold in 2018 and the 10th hotel located in an international market. The sale exemplifies Park’s strategy of recycling capital out of non-core assets and reducing its exposure to international markets as well as joint venture interests. Following the sale, Park now has ownership interests in four hotels outside the U.S., accounting for approximately 1% of Adjusted EBITDA, down from 14 hotels held at the beginning of the year, which represented approximately 5% of 2017 Adjusted EBITDA.
“We are excited to announce the execution of another non-core asset sale at extremely favorable pricing. We have been laser-focused on reshaping our portfolio and maximizing value for our stockholders, and we are pleased that this sale helps to reduce our exposure to international markets, while further simplifying the ownership structure of our assets,” commented Thomas J. Baltimore, Jr., Chairman and Chief Executive Officer of Park. “Since the start of the year, we have successfully sold over $500 million in non-core assets. We continue to be impressed by the strong demand for hotel assets and are very encouraged as we begin the second phase of our capital recycling program.”
Subsequent to the transaction closing, Park’s Board declared a special cash dividend of $0.45 per share (or approximately $90 million) to be paid on July 16th to stockholders of record as of June 29th. This special dividend is in addition to the previously announced regular quarterly dividend of $0.43 per share declared by Park’s Board on April 27th for a total of $0.88 per share to be distributed.