Ashford Hospitality to sell three assets for $69.5M in gross proceeds

Ashford Hospitality (AHT) announced that it has signed definitive agreements to sell the Le Pavillon, New Orleans, a Tribute Portfolio Hotel, the Embassy Suites by Hilton Austin Arboretum, and the Embassy Suites by Hilton Houston Near the Galleria. These sales are expected to generate approximately $69.5M in aggregate gross proceeds. Based on current mortgage interest rates, the company expects more than $2M in annual cash flow improvement and $14.5M in future capital expenditure savings following the sales. The agreement for the 226-room Le Pavillon is for $42.5M or $188,000 per key. The sale is expected to be completed in December and is subject to normal closing conditions. The company provides no assurances that the sale will be completed on these terms or at all. The sale price represents a 2.6% capitalization rate on net operating income or a multiple of 27.2 times Hotel EBITDA for the twelve months ended September 30. The agreement for Embassy Suites by Hilton Austin Arboretum and Embassy Suites by Hilton Houston Near the Galleria, totaling 300 rooms, is for $27M or $90,000 per key. The sale is expected to be completed in January 2026 and is subject to normal closing conditions. The company provides no assurances that the sale will be completed on these terms or at all. When adjusted for the company’s anticipated capital expenditures of $14.5M, the sale price represents a 2.2% capitalization rate on net operating income or a multiple of 29.9 times Hotel EBITDA for the twelve months ended September 30. Excluding the anticipated capital spend, the combined sale price represents a 3.3% capitalization rate on net operating income or a multiple of 19.5 times Hotel EBITDA for the twelve months ended September 30.