Park Hotels & Resorts Inc has announced that it closed on the sale of the 254-room Hilton Rotterdam for gross proceeds of approximately €50m ($62m), equating to €197,440 ($245,000) per key. When adjusted for Park’s anticipated capital expenditures for the Hotel, the sale price represents a 4.8% capitalization rate on the Hotel’s projected 2017 net operating income, or 17.8x the Hotel’s projected 2017 EBITDA.
The sale of the Hotel is consistent with Park’s strategy of recycling capital out of non-core assets, including reducing its exposure to international markets. Revenue per available room (“RevPAR”) for the Hotel represents a discount of nearly 30% to Park’s pro forma RevPAR on a trailing 12-month basis.
“I am thrilled to announce the sale of the Hilton Rotterdam, our first non-core asset sale since launching Park just over a year ago. As previously stated, we remain committed to our goal of creating value for stockholders by recycling capital from lower growth assets,” commented Thomas J. Baltimore, Jr., Chairman and Chief Executive Officer of Park. “Our capital recycling program remains active with additional hotels targeted for sale in 2018, a strategy we believe will dramatically improve the overall quality of our portfolio.”