Holloway Lodging Corp. announces acquisition of controlling interest In Super 8® hotel in St. John's, Nfld
/NOT FOR DISTRIBUTION ON U.S. WIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES/
HALIFAX, July 7, 2014 /CNW/ - Holloway Lodging Corp. (TSX: HLC) ("Holloway") is pleased to announce that it has acquired a controlling interest in the Super 8® hotel located in St. John's, Nfld.
Holloway paid approximately $2.1 million in cash for a 35% interest in this property. Together with its previously held 18% interest, Holloway now owns 53% of this property. The aggregate purchase price paid by Holloway for its 53% interest implies a cap rate of 11.6% based on trailing twelve month net operating income and a price per room of approximately $113,000, substantially below the cost to construct in St. John's today.
As the capital of Newfoundland and Labrador, the St. John's economy benefits from government, educational and medical services as well as the offshore petroleum industry and the development of the emerging Muskrat Falls hydroelectricity project. The Super 8® was built in 2005 and has 81 rooms, a meeting room and fitness center.
Holloway will consider acquiring the remaining interests in this property in due course.
ABOUT HOLLOWAY LODGING CORPORATION
Holloway is a real estate corporation focused on acquiring, owning and operating select and limited service lodging properties and a small complement of full service hotels primarily in secondary, tertiary and suburban markets. Holloway owns 36 hotels with 4,260 rooms. Holloway's shares trade on the TSX under the symbol HLC.
This press release contains forward-looking information within the meaning of applicable securities laws. Forward-looking information may relate to Holloway's future outlook and anticipated events or results and may include statements regarding Holloway's future financial position, business strategy, financial results, plans and objectives. In some cases, forward-looking information can be identified by terms such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "intend", "estimate", "predict", "potential", "continue" or other similar expressions concerning matters that are not historical facts. Forward-looking information is subject to certain factors, including risks and uncertainties, that could cause actual results to differ materially from what Holloway currently expects and there can be no assurance that such statements will prove to be accurate. Some of these risks and uncertainties are described under "Risk Factors" in Holloway's annual information form for the year ended December 31, 2013 which is available on Holloway's profile on the SEDAR website at www.sedar.com. Holloway does not intend to update or revise any such forward-looking information should its assumptions and estimates change.
SOURCE Holloway Lodging CorporationFor further information: please contact Michael Rapps, Chairman, at (416) 855-1925 or Jane Rafuse, Chief Financial Officer, at (902) 443-5101.