Embassy Suites by Hilton Tucson Paloma Village sold for $ 25.5 million

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Summit Hotel Properties, Inc. (NYSE: INN) announced that it completed the acquisition of the 120-room Embassy Suites by Hilton Tucson / Paloma Village for $ 25.5 million through its joint venture with GIC on December 21, 2021.

Embassy Suites by Hilton Tucson Paloma Village

Summit Hotel Properties;

Summit Hotel Properties, Inc. (NYSE: INN) announced that it has completed the acquisition of the 120-room Embassy Suites by Hilton Tucson / Paloma Village for $ 25.5 million through its joint venture with GIC on December 21, 2021. The investment represents a quality hotel, market leader in a rapidly growing market.

The property’s excellent location and dominant Embassy Suites brand affiliation have resulted in the hotel consistently ranking at the top of its competition, with an average RevPAR index of nearly 150% over the past five years. . While occupancy and ADR in the Tucson market are historically strongest in February and March, primarily due to leisure travel, Embassy Suites benefit from year-round demand from a multitude of sources within government, corporate and business traveler segments. The Company’s joint venture with GIC also owns the Homewood Suites by Hilton Tucson / St. Philip’s Plaza University, located less than three kilometers south of the Embassy Suites, will allow the company to implement operational synergies and revenue improvement strategies that will benefit both hotels.

Situated on nearly six acres, the Embassy Suites location in the Catalina Foothills places it among Tucson’s most upscale single-family homes, shops, and restaurants, and offers significant barriers to entry. Embassy Suites was built in 2007, and since then no other hotel has been built within a three-mile radius. The hotel is adjacent to La Encantada – a luxury open-air mall with high-quality dining options and an attractive tenant list including Apple, Coach, Kendra Scott, Crate & Barrel, Williams Sonoma, Pottery Barn and Lululemon, among others. Directly east of the Embassy Suites is La Paloma Country Club – a private 27-hole Jack Nicklaus Signature Design Golf course, world-class tennis facilities, a swimming pool complex and a variety of dining options . Additional market demand is being generated by the University of Arizona and its health system, government and related contracting companies, youth sports teams, national park enthusiasts and business travelers.

The joint venture acquired the property with a combination of cash and an assumed loan with a balance of approximately $ 13.3 million. The loan has a fixed interest rate of 4.99% and a maturity date of June 2028. Following this transaction, the Company maintains nearly $ 450 million in total cash and over $ 150 million in capacity. current investment authorized under modifications to its credit facility to continue future investments. Opportunities.

The company expects the hotel to generate a full-year 2022 net operating return of between 7.0% and 7.5%.

Summit Hotel Properties, Inc. is a publicly traded real estate investment trust that focuses on owning high-end branded hotels with efficient operating models primarily in the high-end segment of the industry. accommodation. As of January 4, 2022, the Company’s portfolio consisted of 74 hotels, of which 61 are wholly owned, with a total of 11,518 rooms located in 23 states.

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