La Quinta Holdings Inc. announced Friday that it has signed a definitive purchase and sale agreement to sell 24 owned hotels. This portfolio is geographically dispersed and the vast majority of these hotels will be removed from the La Quinta system.
La Quinta said the sale price for these assets represents an attractive EBITDA multiple and the company expects to close the sale prior to the end of 2015.
As a result of this transaction, the company said it expects to enhance the brand; improve several key operating metrics such as RevPAR and RevPAR Index; open additional markets for franchise development; and reduce near-term capital expenditure requirements.
“This is another positive step as we continue to enhance our portfolio and improve the overall brand experience for our customers,” said La Quinta President and CEO Wayne Goldberg. “We are continuing to execute our strategy of optimizing the owned hotel portfolio. We are excited to be working with a group of key franchise partners in this transaction where we are able to monetize assets from our portfolio at an accretive multiple and grow our franchise pipeline, while allowing our franchise partners to acquire assets strategic to their businesses. As part of this transaction, the buyers have committed to work with us in developing several franchised La Quinta hotels in key markets. As this transaction illustrates, we remain committed to finding ways to improve our performance and grow long-term shareholder value.”