PHILADELPHIA Hersha Hospitality Trust has entered into a new US$250 million senior secured revolving credit facility, which replaced the company’s prior US$135 million senior secured credit facility.
“We are pleased to have increased our financing capacity with the closing of the new credit facility,” says CEO Jay Shah. “With a syndicate of 11 banks participating in the facility, we have the support of a notable group of banks, providing us with greater balance sheet flexibility. This new credit line gives us the capacity to pursue attractive external growth opportunities. Through our network of relationships as one of the largest owners of select service hotels in urban northeastern markets, we expect to continue to execute on our strategy by selectively expanding the portfolio while continuing to maximize the operating results of our existing portfolio.”
The US$250 million credit facility matures in November 2013, and Hersha may request an extension of the maturity date for an additional year. Borrowings will bear interest at a rate determined by a leverage-based pricing grid. LIBOR rate loans will bear interest at LIBOR plus an applicable margin of either 350 or 375 basis points per year, subject to a LIBOR floor of 75 basis points per year. Prime rate loans will bear interest at the prime rate plus an applicable margin of either 150 or 175 basis points per year.
Hersha Hospitality Trust is a self-advised REIT that owns interests in 76 hotels, totaling 10,071 guestrooms, primarily along the Northeast Corridor from Boston to Washington D.C. Hersha also owns hotels in Northern California and Scottsdale, Arizona. Hersha focuses on upscale, mid-scale and extended stay hotels in major metropolitan markets.
TD Securities (USA) LLC arranged the new credit facility and TD Bank NA will act as the administrative agent for the various lenders participating in the new credit facility. The syndicate of banks participating in the company’s new credit facility include TD Bank; M&T Bank; Raymond James Bank; Bank of America NA; Barclays Bank PLC; Deutsche Bank AG; Goldman Sachs Bank USA; Morgan Stanley Bank NA; The Provident Bank; UBS Loan Finance LLC; and Sovereign Bank.