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New Credit Facility for Host Hotels - Analyst Blog

Host Hotels & Resorts Inc . (HST) recently announced that it has closed a new $1 billion revolving credit facility, which represents a $400 million increase from its existing facility, maturing September 2012. The company also has an option to increase the principal amount of the new facility by an additional $500 million, thus extending the total amount to $1.5 billion.

As a part of the company's corporate strategy, the new credit facility improves liquidity and flexibility and bears an initial term of four years plus a one-year extension option.

At the end of the reported quarter, Host Hotels had over $524 million in cash and cash equivalents and about $481 million available under its credit facility. Total debt of the company at the end of the third quarter of 2011 was $5.5 billion.

Host Hotels is the largest lodging REIT with high quality lodging assets in geographically diverse locations. Over the years, the company has executed a focused and disciplined long-term strategic plan to acquire high quality lodging assets in hard-to-replicate areas, which have the potential for significant capital appreciation. This provides a significant upside potential for the company.

Host Hotels has a strong balance sheet, which provides the financial flexibility to pursue high-yielding acquisitions, high ROI (return on investments) capital projects, dividend payouts and share buybacks. This augurs well for its long-term growth.

Host Hotels currently retains a Zacks #3 Rank, which translates into a short-term Hold rating. We are also maintaining our long-term Neutral recommendation on the stock. One of its competitors, LaSalle Hotel Properties(LHO) also holds a Zacks #3 Rank

HOST HOTEL&RSRT ( HST ): Free Stock Analysis Report

LASALLE HTL PRP ( LHO ): Free Stock Analysis Report

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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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