The company wouldn't disclose the buyers' names because of a contract stipulation. Along with the November 2003 sale of the 98-room Holiday Inn North Miami, Lodgian has used the proceeds to reduce debt by more than $10 million, says company president and CEO W. Thomas Parrington.
The Florida sale, also to an undisclosed buyer, went for $3.3 million, or $33,673 per room, the highest per-room price Lodgian has managed to negotiate in the sales to date.
Lodgian emerged from Chapter 11 with 78 hotels on Nov. 25, 2002, as GlobeSt.com previously reported. The 78 hotels were owned by Lodgian subsidiaries Impac Hotels II LLC and Impac Hotels III LLC. When the two subsidiaries filed for protection under the US Bankruptcy Codes on Dec. 5, 2002, Lodgian listed total assets of $1 million and debt of $968.7 million.
Parrington is confident the company can sell the remaining 15 non-core properties in the company's portfolio by yearend. "We are making steady progress on our asset disposition plan and are in active negotiations on a number of other hotel transactions," he says. "As indications of economic improvement continue, hotel real estate prices are firming and the number of active buyers is growing."
Lodgian has invested $30 million to date in upgrading its portfolio. The properties sold in the latest disposition were the 246-room Holiday Inn Market Center in Dallas that went for $2.6 million, or $10,569 per room; the 135-room Holiday Inn Baltimore West sold for $3.6 million, or $26,667 per room; and the 152-room Holiday Inn Syracuse-Fairgrounds Area in New York sold for $3 million, or $19,737 per room.
The Dallas property had generated $28,000 of earnings before interest, taxes, depreciation and amortization for a net loss of $873,000. The Baltimore asset generated $265,000 of EBITDA and a net loss of $70,000. The Syracuse hotel generated $356,000 of EBITDA and a net income of $38,000.
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