Service Properties Trust - SVC STOCK NEWS

Service Properties Trust (Nasdaq: SVC) announced the termination of a management agreement with Hyatt for 22 Hyatt Place hotels. Hyatt's obligations under this agreement included a minimum return of $22 million annually, backed by a $50 million guaranty, which has now been exhausted. The termination is effective April 8, 2021. Discussions are ongoing for a possible amended agreement with Hyatt; if unsuccessful, management will transfer to Sonesta International Hotels. SVC owns 34% of Sonesta, indicating potential strategic alignment.

Service Properties Trust (SVC) has completed the sale of ten Hawthorn Suites hotels, totaling 1,212 rooms, for $41 million, which will help repay debt. The hotels had a net carrying value of $30.4 million. Additionally, SVC has entered into a lease agreement for five remaining Hawthorn Suites, set to be sold for $22.3 million by the end of Q2 2021, with an expected return of 8% on lease income.

This strategic move aims to enhance liquidity and reduce debt obligations, vital for SVC's financial health.

Service Properties Trust (SVC) has transitioned the branding and management of 12 hotels to Sonesta International Hotels Corporation, including three from InterContinental Hotels Group and nine from Marriott International. This follows the earlier transition of 99 hotels to Sonesta. SVC's management agreements with Sonesta are short-term, expiring on December 31, 2021. The CEO expressed optimism about leveraging Sonesta's growth and improving flexibility in hotel management amid challenging market conditions.

On December 2, 2020, Sonesta International Hotels Corporation announced a significant expansion with 102 new hotels added to its portfolio, 99 of which were reflagged as Sonesta on December 1. This expansion includes properties in major North American cities such as Dallas, Denver, and Los Angeles, marking Sonesta's entry into new markets, including Canada. The company is also launching the 'Sonesta Simply Suites' brand with over 60 locations, enhancing its presence in the extended-stay segment. Sonesta's portfolio has grown nearly 350%, now operating almost 300 properties across multiple countries.

Service Properties Trust (Nasdaq: SVC) has successfully transitioned the management of 99 hotels to Sonesta International Hotels Corporation from InterContinental Hotels Group. This shift includes short-term agreements that will last until December 31, 2021. Sonesta has launched a new brand, Sonesta Simply Suites, marking a significant launch in the U.S. hotel sector. While SVC anticipates benefits from this transition and its 34% ownership in Sonesta, potential risks include service quality concerns and uncertainties around the ongoing COVID-19 pandemic's impact on the hotel industry.

Service Properties Trust (Nasdaq:SVC) has completed the sale of eight TownePlace Suites hotels, totaling 834 rooms, for $45.3 million, against a net carrying value of $35.0 million. The proceeds will be allocated for debt repayment. John Murray, President and CEO, expressed satisfaction with achieving pricing reflective of pre-pandemic valuations, highlighting the resilience of extended stay lodging compared to other hospitality segments during the pandemic.

Service Properties Trust (Nasdaq: SVC) has priced an underwritten public offering of $450 million in 5.50% unsecured senior notes due 2027, guaranteed by certain subsidiaries. The settlement of this offering is anticipated on November 20, 2020, pending customary closing conditions. Proceeds from the offering will be used to pay down amounts outstanding on its revolving credit facility. The offering is led by major financial institutions including BofA Securities and Wells Fargo Securities, with the registration statement filed with the SEC to provide more details.

Service Properties Trust (Nasdaq: SVC) announced that CEO John Murray, CFO Brian Donley, and CIO Todd Hargreaves will present at Nareit’s REITworld: 2020 Virtual Investor Conference on November 18, 2020, at 9:30 a.m. Eastern Time. To join the live presentation, registration is required via Nareit’s REITworld Registration link. An on-demand recording will be available for the duration of the conference. SVC owns hotels and retail properties across the U.S., Puerto Rico, and Canada, with 149 brands across 23 industries, primarily under long-term management agreements.

Service Properties Trust (SVC) reported a net loss of $102.6 million for Q3 2020, compared to a profit of $40.1 million in Q3 2019. Its nine-month net loss reached $173.6 million, down from $274.6 million profit last year. Normalized FFO dropped significantly, totaling $23.2 million in Q3 2020, a decline from $155.6 million in Q3 2019. SVC is transitioning hotel management from IHG and Marriott to Sonesta due to unpaid returns, while hotel occupancy improved from 21% in April to 45.8% in September. Rent collections from retail tenants increased to 89.3% in September.