BETHESDA, Maryland—RLJ Lodging Trust intends to use almost all of the proceeds from its US$495-million initial public offering to wipe out more than a quarter of its hotel debt.
All of the debt is scheduled to come due by May 2012, with more than US$164 million of the debt coming due this year, according to a filing made by RLJ with the U.S. Securities and Exchange Commission on 9 May.
In total, RLJ will be eliminating US$492 million of debt. After the payoffs, RLJ will have US$1.3 billion of debt remaining.
President and CEO Thomas J. Baltimore, Jr. could not be reached for comment before deadline.
Details of the loans to be paid off are listed below.
Contact:
RLJ Lodging Trust
Phone: (301) 280-7777
| Property | Amount to be repaid (1) | Interest rate | Effective annual interest rate (2) | Maturity date |
| Louisville Marriott Downtown (3) | US$72.24 million | LIBOR plus 1.75% | 2.01% | June 2011 |
| Multi-property loan (10 hotels) | US$92 million | LIBOR plus 1.6% | 1.86% | July 2011 |
| Embassy Suites Los Angeles-Downey (4) | US$23.97 million | LIBOR plus 2.5% | 5.59% | January 2012 (5) |
| Hyatt Summerfield Suites portfolio-senior (six hotels) (6) | US$8.59 million | LIBOR plus 1.24% | 4.57% | April 2012 |
| Hyatt Summerfield Suites portfolio-mezzanine (six hotels) (6) | US$6.62 million | LIBOR plus 2.75% | 6.08% | April 2012 |
| Hilton Garden Inn St. George | US$10.82 million | LIBOR plus 4% | 5.5% | May 2012 (7) |
| SpringHill Suites Bakersfield | US$9.98 million | LIBOR plus 4% | 5.5% | May 2012 (7) |
| SpringHill Suites Gainesville | US$12.36 million | LIBOR plus 4% | 5.5% | May 2012 (7) |
| Hampton Inn & Suites Clearwater/St. Petersburg Ulmerton Road, Florida | US$10.33 million | LIBOR plus 4% | 5.5% | May 2012 (7) |
| Hampton Inn Garden City | US$22.93 million | LIBOR plus 4% | 5.5% | May 2012 (7) |
| Hampton Inn & Suites Las Vegas-Red Rock/Summerlin | US$11.08 million | LIBOR plus 4% | 5.5% | May 2012 (7) |
| Hampton Inn Ft. Walton Beach | US$11.36 million | LIBOR plus 4% | 5.5% | May 2012 (7) |
| Hilton Mystic | US$13.34 million | LIBOR plus 4% | 5.5% | May 2012 (7) |
(1) Amounts based on outstanding balance as of 31 December 2010.
(2) Effective annual interest rate at 31 December 2010 gives effect to interest rate swaps and LIBOR floors, as applicable.
(3) Affiliate of Raymond James & Associates, an underwriter of the offering, is one of the lenders that will be repaid with a portion of the IPO proceeds. The affiliate will receive a portion of the net proceeds used to repay indebtedness.
(4) Affiliate of Wells Fargo Securities LLC is also an underwriter and lender that will be repaid with IPO proceeds. The affiliate will also receive a portion of the net proceeds used to repay indebtedness.
(5) Maturity date could be extended for one year at RLJ’s option (subject to satisfaction of conditions including maintenance of the debt service coverage ratio and advance notice of the exercise of RLJ’s option).
(6) Amount represents a partial paydown. The portfolio is subject to senior and mezzanine loans which had outstanding balances as of 31 December 2010 of US$48 million and US$37 million, respectively.
(7) Maturity date could be extended for up to two one-year periods at RLJ’s option (subject to conditions including a principal paydown for the first extension, maintenance of the debt service coverage ratio for the second extension, and advance notice of the exercise of RLJ’s option).