WILLIAMSBURG, VA. — A joint venture between Kemmons Wilson Hospitality Partners LP and Ascendant Capital Partners LP, doing business jointly as KW Kingfisher LLC, has entered into a definitive merger agreement with Sotherly Hotels Inc. (NASDAQ: SOHO), a hospitality REIT based in Williamsburg. Sotherly owns 10 upscale hotels in the Sun Belt and Mid-Atlantic totaling 2,786 hotel rooms, as well as interests in two condominium hotels and their associated rental programs.
Sotherly’s portfolio includes:
– The Georgian Terrace in Atlanta
– The Whitehall in Houston
– The DeSoto in Savannah, Ga.
– Lyfe Resort & Residences in Hollywood, Fla.
– Hyde Beach House in Hollywood, Fla.
– DoubleTree by Hilton Hollywood Beach Resort in Hollywood, Fla.
– Hotel Ballast in Wilmington, N.C.
– Hotel Alba in Tampa, Fla.
– Hyatt Centric Arlington in Arlington, Va.
– DoubleTree Jacksonville Riverfront in Jacksonville, Fla.
– DoubleTree by Hilton Laurel in Laurel, Md.
– DoubleTree by Hilton Philadelphia Airport
“This transaction is a testament to the high-quality portfolio that Sotherly has built over the past 20-plus years as a publicly traded company, and we are confident this will pave a path toward future success for our hotels and the associates and guests who enjoy them every day,” says David Folsom, CEO of Sotherly.
Under terms of the agreement, KW Kingfisher will acquire all outstanding shares of Sotherly’s common stock for $2.25 per share in an all-cash transaction. The purchase price represents a premium of 152.7 percent to the REIT’s closing share price on Oct. 24 ($0.89 per share), the last trading day prior to the announcement of the transaction, as well as a 126.4 percent premium to the volume weighted average share price over the previous 30 days.
Affiliates of Apollo and Ascendant provided debt financing commitments to KW Kingfisher. Berkadia served as sole financial advisor to Kemmons Wilson and arranged the debt financing.
The merger agreement has been unanimously approved by Sotherly’s full board of directors following a unanimous recommendation from a special committee comprised of the board’s independent directors. The merger is expected to close in the first quarter of 2026, subject to approval by Sotherly stockholders and customary closing conditions.
Andrew Sims, Sotherly’s chairman of the board and one of the company’s largest stockholders, has agreed to vote all of his shares in favor of the transaction.
— John Nelson