BRAEMAR HOTELS & RESORTS ADDRESSES FINAL 2025 DEBT MATURITY WITH REFINANCING OF FIVE HOTELS AND REDUCES INTEREST COSTS
Rhea-AI Summary
Braemar Hotels & Resorts (NYSE: BHR) has successfully closed a $363 million refinancing deal covering five luxury properties. The new loan features a two-year initial term with three one-year extension options, potentially extending to 2030, and carries a floating interest rate of SOFR + 2.52%.
The refinancing encompasses The Clancy, The Notary Hotel, Marriott Seattle Waterfront, Sofitel Chicago Magnificent Mile, and The Ritz-Carlton Reserve Dorado Beach. The loan amount represents a 48.9% loan-to-value ratio, with the properties collectively appraised at $742.2 million.
This strategic move replaces two existing loans: a $293.2 million facility at SOFR + 2.66% maturing in June 2025 and a $62 million loan at SOFR + 4.75% due in March 2026. The refinancing addresses BHR's final 2025 debt maturity while securing more favorable interest terms and extending the weighted average maturity of its debt portfolio.
Positive
- Secured lower interest rates (SOFR + 2.52%) compared to previous rates
- Extended debt maturity timeline potentially to 2030
- Eliminated all remaining 2025 debt maturities
- Conservative 48.9% loan-to-value ratio indicates strong asset value
Negative
- Increased total debt from $355.2M to $363M
- Floating interest rate exposure could lead to higher costs if rates rise
News Market Reaction
On the day this news was published, BHR declined NaN%, reflecting a moderate negative market reaction.
Data tracked by StockTitan Argus on the day of publication.
"We are pleased to announce the closing of this financing at a very attractive spread," said Richard J. Stockton, Braemar's President and Chief Executive Officer. "This financing addresses our only remaining final debt maturity for 2025 and not only results in a lower cost of capital for the debt on these assets, but also improves our maturity schedule and extends our weighted average maturity."
Braemar Hotels & Resorts is a real estate investment trust (REIT) focused on investing in luxury hotels and resorts.
Forward-Looking Statements
Certain statements and assumptions in this press release contain or are based upon "forward-looking" information and are being made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements in this press release include, among others, statements about the Company's strategy and future plans. These forward-looking statements are subject to risks and uncertainties. When we use the words "will likely result," "may," "anticipate," "estimate," "should," "expect," "believe," "intend," or similar expressions, we intend to identify forward-looking statements. Such statements are subject to numerous assumptions and uncertainties, many of which are outside Braemar's control.
These forward-looking statements are subject to known and unknown risks and uncertainties, which could cause actual results to differ materially from those anticipated, including, without limitation: our ability to repay, refinance or restructure our debt and the debt of certain of our subsidiaries; anticipated or expected purchases or sales of assets; our projected operating results; completion of any pending transactions; risks associated with our ability to effectuate our dividend policy, including factors such as operating results and the economic outlook influencing our board's decision whether to pay further dividends at levels previously disclosed or to use available cash to pay dividends; our understanding of our competition; market trends; projected capital expenditures; the impact of technology on our operations and business; general volatility of the capital markets and the market price of our common stock and preferred stock; availability, terms and deployment of capital; availability of qualified personnel; changes in our industry and the markets in which we operate, interest rates or the general economy; and the degree and nature of our competition. These and other risk factors are more fully discussed in Braemar's filings with the Securities and Exchange Commission.
The forward-looking statements included in this press release are only made as of the date of this press release. Such forward-looking statements are based on our beliefs, assumptions, and expectations of our future performance taking into account all information currently known to us. These beliefs, assumptions, and expectations can change as a result of many potential events or factors, not all of which are known to us. If a change occurs, our business, financial condition, liquidity, results of operations, plans, and other objectives may vary materially from those expressed in our forward-looking statements. You should carefully consider this risk when you make an investment decision concerning our securities. Investors should not place undue reliance on these forward-looking statements. The Company can give no assurance that these forward-looking statements will be attained or that any deviation will not occur. We are not obligated to publicly update or revise any forward-looking statements, whether as a result of new information, future events or circumstances, changes in expectations, or otherwise, except to the extent required by law.
View original content:https://www.prnewswire.com/news-releases/braemar-hotels--resorts-addresses-final-2025-debt-maturity-with-refinancing-of-five-hotels-and-reduces-interest-costs-302396956.html
SOURCE Braemar Hotels & Resorts, Inc.
FAQ
What is the value of Braemar's new refinancing deal for five hotels?
Which hotels are included in BHR's 2024 refinancing package?
What is the loan-to-value ratio of BHR's new $363M refinancing?
How does the new refinancing improve BHR's interest costs?
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