Ashford Reaches Deal To Sell Downtown Boston Hotel For $123M
Ashford Hospitality Trust is selling a downtown Boston hotel as it works to shore up its finances in the face of major debt maturities.
The Dallas-based REIT announced Wednesday morning it reached an agreement to sell the 315-room Courtyard Boston Downtown hotel on Tremont Street for $123M. It didn't disclose the buyer, but it said the sale is expected to close in January.
"We are pleased to announce the signed agreement to sell the Courtyard Boston Downtown at a very attractive cap rate," Ashford Trust CEO Stephen Zsigray said in a statement. "We continue to have several assets in the market at various stages of the sales process and are encouraged by the improved sentiment we are seeing in the transaction market."
In 2011, Ashford, as part of a joint venture with an unnamed institutional investor, acquired the property as part of a 28-property portfolio in a Highland Hospitality foreclosure sale for $1.28B. Ashford put down $150M in cash and $786M in debt for the deal.
The REIT has been selling off assets and extending loans this year in an effort to deal with its large amount of maturing debt.
In February, the REIT announced its plans to sell off a dozen properties to pay down its $2.6B in debt coming due in 2026. One of those sales was its 390-room Hilton Boston Back Bay hotel, which it sold to Certares Management and Belcourt Capital Partners for $171M.
Last month, Ashford announced it negotiated a 90-day forbearance agreement and is in talks on a multiyear extension for a $410M CMBS loan that was previously set to mature Nov. 9.
Boston's hotel market has been ranked one of the most attractive for investors this year, but high interest rates and a lack of supply have held it back from seeing significant sales volume. Hotels in Boston have benefited from the slow supply of new hotels to compete for guests— with the citizenM in the Back Bay being the only new hotel to open this year — leading to higher revenue per available room and occupancy rates.
JLL listed the Courtyard Boston Downtown hotel for sale earlier this year, and it marketed Boston's strong fundamentals and lack of new supply as a selling point for potential investors. Additionally, it said the hotel's brand management agreement expires in January 2026, giving a new owner the option to bring on a new brand.
