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FelCor (FCH) Divests Embassy Suites Hotel for $29.5 Million - Analyst Blog

In sync with its portfolio restructuring plans, FelCor Lodging Trust IncorporatedFCH , the Irving, TX-based real estate investment trust ("REIT"), divested Embassy Suites Hotel - San Antonio Airport. FelCor sold the 261-room hotel for $29.5 million and intends to use the proceeds for lowering its outstanding debt.

The latest divestiture is part of FelCor's portfolio repositioning plan. Since 2010, the REIT has divested 35 non-strategic hotels, accruing gross proceeds of $794 million. Currently, FelCor has five non-strategic hotels lined up for sale. In fact, contracts have already been signed for three of these hotels, while the two remaining ones will be up for sale later this month.

Just over a month ago, FelCor sold two non-strategic hotels, Embassy Suites Hotel - Raleigh and Westin - Dallas Park Central in two separate transactions. Through these sales, FelCor reaped gross proceeds of $63.6 million in total. At that time, the company had hinted at the possible divestiture of Embassy Suites Hotel - San Antonio Airport, furnishing the information that the purchaser has made a $500,000 non-refundable deposit payment toward the sale price.

FelCor owns a diversified portfolio of primarily upper-upscale and luxury hotels, located in major resort markets throughout the U.S. We believe that divestiture of these non-core hotels will enhance the quality of the company's portfolio. Further, as the proceeds will be used for reducing FelCor's outstanding debt, this will lower its interest burden and strengthen its financial position.

FelCor currently carries a Zacks Rank #3 (Hold).

Better-ranked equity REITs include Ryman Hospitality Properties, Inc. RHP , CareTrust REIT, Inc. CTRE and Kilroy Realty Corp. KRC . All these stocks sport a Zacks Rank #1 (Strong Buy).

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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