News for the Hospitality Executive
Properties Trust (NYSE: HPT) today announced that it has entered into
agreements to acquire the entities which own the Royal Sonesta Hotel in
Cambridge, MA (400 keys, 2 restaurants/bars and 22,000 sq.ft. of
meeting space) and lease the Royal Sonesta Hotel in New Orleans, LA
(483 keys, five restaurants/bars and 20,000 sq.ft. of meeting space)
for approximately $150.5 million.
The Cambridge and New Orleans hotels are currently operated by Sonesta International Hotels Corporation (NASDAQ GLOBAL: SNSTA). The Cambridge hotel is owned by a SNSTA subsidiary and the New Orleans hotel is leased by a SNSTA subsidiary. HPT’s acquisition is a component part of a transaction that involves the acquisition by merger of all of SNSTA’s shares by Sonesta Acquisition Corp. (“SAC”), an affiliate of Reit Management & Research LLC (“RMR”), the manager of HPT. Upon completion of the merger, SAC will transfer the entities which own the Cambridge hotel and lease the New Orleans hotel to HPT, and HPT expects to prepay an existing mortgage encumbering the Cambridge hotel, which mortgage amount is included in the purchase price above. Prior to completion of the merger, SAC will be capitalized independently from HPT with $25 million. The transaction is expected to close during the first quarter of 2012.
After the merger and sale to HPT of the entities which own the Cambridge hotel and lease the New Orleans hotel, SAC will retain the existing management business of SNSTA and these hotels will continue to be managed by the same management team which now operates these two hotels. Also, SAC and its Sonesta management team will be available to operate other hotels for HPT, including certain hotels HPT now owns and it is considering rebranding and hotels it may selectively acquire in the future. Because RMR and SAC are affiliated, the purchase price for the Cambridge and New Orleans hotels and the terms of the management contracts for these hotels were approved by Independent Trustees of HPT who are not owners, employees or otherwise affiliated with RMR.
John G. Murray, President of HPT, made the following statement at the time of this announcement:
“HPT is pleased to be adding the Sonesta management team to the hotel operators with whom it does business. Sonesta is a niche brand with a strong reputation for high quality accommodations and guest services. HPT looks forward to working with Sonesta personnel to expand the Sonesta brand.”
Duff & Phelps LLC provided certain valuation services to the Independent Trustees of HPT. Attorneys at Skadden, Arps, Slate, Meagher & Flom LLP and at Sullivan & Worcester LLP represented SAC and HPT, respectively.
Hospitality Properties Trust is a real estate investment trust, or REIT, which owns 288 hotels and 185 travel centers located throughout the United States and in Ontario, Canada and Puerto Rico. HPT is headquartered in Newton, MA.
WARNING REGARDING FORWARD LOOKING STATEMENTS
THIS PRESS RELEASE CONTAINS FORWARD LOOKING STATEMENTS WITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 AND OTHER SECURITIES LAWS. THESE FORWARD LOOKING STATEMENTS ARE BASED UPON HPT’S PRESENT BELIEFS AND EXPECTATIONS BUT THEY ARE NOT GUARANTEED TO OCCUR AND MAY NOT OCCUR FOR VARIOUS REASONS, INCLUDING SOME REASONS BEYOND HPT’S CONTROL. FOR EXAMPLE:
IMPORTANT ADDITIONAL INFORMATION
IN CONNECTION WITH THE PROPOSED MERGER, HPT EXPECTS THAT SNSTA WILL FILE RELEVANT MATERIALS WITH THE SEC, INCLUDING A PROXY STATEMENT. INVESTORS AND SECURITY HOLDERS OF SNSTA ARE URGED TO READ THESE DOCUMENTS (IF AND WHEN THEY BECOME AVAILABLE) AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT SNSTA, THE PROPOSED TRANSACTIONS AND THE PARTIES TO THE PROPOSED TRANSACTIONS. INVESTORS AND SECURITY HOLDERS MAY OBTAIN THESE DOCUMENTS (AND ANY OTHER DOCUMENTS FILED BY SNSTA, HPT AND SAC WITH THE SEC) FREE OF CHARGE AT THE SEC’S WEBSITE AT WWW.SEC.GOV. IN ADDITION, THE DOCUMENTS FILED WITH THE SEC BY SNSTA MAY BE OBTAINED FREE OF CHARGE BY DIRECTING SUCH REQUEST TO: BOY VAN RIEL, VICE PRESIDENT AND TREASURER OF SNSTA AT (617) 421-5444, OR BY ACCESSING SONESTA’S INVESTOR INFORMATION WEBSITE AT HTTP://WWW.SONESTA.COM/CORPORATE/INDEX.CFM?FA=CORPORATE.INVESTORINFORMATION . INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE SNSTA PROXY STATEMENT AND THE OTHER RELEVANT MATERIALS WHEN THEY BECOME AVAILABLE BEFORE MAKING ANY VOTING OR INVESTMENT DECISION WITH RESPECT TO THE PROPOSED MERGER.
SNSTA, SAC AND HPT AND EACH OF THEIR RESPECTIVE DIRECTORS, TRUSTEES AND EXECUTIVE OFFICERS MAY BE DEEMED TO BE PARTICIPANTS IN THE SOLICITATION OF PROXIES FROM SNSTA’S STOCKHOLDERS IN RESPECT OF THE PROPOSED MERGER. STOCKHOLDERS MAY OBTAIN INFORMATION REGARDING PARTICIPANTS IN THE SOLICITATION OF PROXIES FROM SNSTA’S STOCKHOLDERS IN RESPECT OF THE PROPOSED MERGER, AND THEIR RESPECTIVE INTERESTS WITH RESPECT TO THE PROPOSED MERGER, BY READING THE DEFINITIVE PROXY STATEMENT AND OTHER RELEVANT DOCUMENTS REGARDING THE PROPOSED TRANSACTIONS, WHEN THEY ARE FILED WITH THE SEC.
A Maryland Real Estate Investment Trust with transferable shares of beneficial interest listed on the New York Stock Exchange
No shareholder, Trustee or officer is personally liable for any act or obligation of the Trust.
Hospitality Properties Trust
Timothy A. Bonang, 617-796-8232
Vice President, Investor Relations
Carlynn Finn, 617-796-8232
Senior Manager, Investor Relations
Revises Existing Agreements for 130 Hotels with Hospitality Properties
Trust into One New 25 Year Management Contract / July 2011
Properties Trust Sells 18 Homestead Hotels For $205.35 Million /
Purchases Two Crowne Plaza Hotels from FelCor for $63 million /
|Hospitality Properties Trust Agrees to Purchase 9 Hotels for $196.2 Million; Seven Hotels Are Being Purchased from FelCor Lodging Trust and Two from InterContinental Hotels Group / January 2006|
|Hospitality Properties Trust Acquires the 195 room Harbor Court Hotel in Baltimore for Approximately $60 million; Signs Agreement with IHG to Manage the Hotel under the InterContinental Hotels and Resorts Brand / January 2006|