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MCLEAN, VA-Highland Hospitality Corp. has just closed on a $150-million unsecured revolving credit facility. The transaction refinances an existing $100-million secured term loan with floating interest rate that the hotel REIT completed in December 2004.

The new three-year credit facility comes with the option for a one-year extension, in addition to the potential for an increase in the value by another $50 million. Wells Fargo Bank NA served as the administrative agent--as it did with 2004's term loan facility--and sole lead arranger.

"The refinancing of our existing term loan facility provides us with more financial flexibility, added investment capacity and improved pricing," says Highland executive vice president and CFO Douglas W. Vicari. "This new facility will allow us to satisfy our strategic objectives in the near future, while giving us flexibility for growth going forward."