The hotel is located at downtown Manhattan.
US Ascott Residence Trust has secured its second acquisition as it purchases Sheraton Tribeca New York Hotel for US$158m, including a 4.8% discount to the independent valuation of US$166m.
Separately, it has also announced the launching of a private placement to raise gross proceeds of $100m, according to a report by OCBC.
“94.8m new units will be placed out at an issue price of S$1.055, which is a discount of 6.6% to its closing price prior to the announcement. ART intends to use ~S$98.5m of the proceeds to fund the proposed hotel acquisition,” OCBC said.
Meanwhile, the remaining amount will be financed with onshore USD debt, OCBC said. “On a pro forma basis, the asset will be acquired at an EBITDA yield of 6.8%, and is estimated to increase ART’s DPU by 1.5%,” OCBC added.
“The hotel comprises 369 guest rooms, with a current occupancy rate of more than 90%, and delivered 7% YoY growth in its RevPAU in 2015. It is strategically located close to the financial district and other unique neighbourhoods such as SoHo and Chinatown, and is also within a two minute walk from the subway station,” OCBC said.
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