MYRTLE BEACH, S.C. — RLJ Lodging Trust (NYSE: RLJ), a Maryland-based hospitality REIT, has sold Kingston Resorts, comprising the Hilton Myrtle Beach Resort and Embassy Suites by Hilton Myrtle Beach Oceanfront Resort, for $156 million.
The properties span 385 rooms and 255 rooms, respectively. The sales price equates to $244,000 per room at a capitalization rate of 6.7 percent, inclusive of $44.5 million in capital expenditures.
The buyer was privately held real estate firm EOS Investors LLC, which describes the 160-acre property as “the largest and most comprehensive oceanfront conference venue between Atlantic City, New Jersey, and West Palm Beach, Florida.” The buyer notes that the acquisition includes over 1,600 residential condominiums and townhomes in addition to the hotels.
The two Hilton-operated hotels offer an array of amenities, including pools, tennis courts, fitness centers, spas, business centers, bike rental services and onsite restaurants and bars. Guest rooms feature private balconies, and suites with kitchen and living areas are available. The properties also feature over 100,000 square feet of event space. Hilton will continue to operate the assets following the sale.
“This transaction is a continuation of our strategic efforts to sell non-core hotels and recycle capital into more accretive opportunities that will ultimately drive long-term shareholder value,” says Leslie Hale, president and CEO of RLJ Lodging Trust.
According to the company’s 2018 report, filed in advance of this transaction, RLJ’s portfolio consists of 150 properties totaling 28,597 rooms across 25 states. Roughly 75 percent of the company’s hotels are under the Marriott and Hilton brands.
RLJ’s stock price opened at $17.89 per share on Monday, July 1, down from $22.01 per share a year ago. The company paid dividends to shareholders in excess of $250 million in 2018 and repurchased 1.2 million shares of its own stock at a discount to net asset value.
— Taylor Williams