Toronto-based Skyline Investments has completed the sale of 11 Courtyard by Marriott hotels in the United States after an unsuccessful attempt this year to sell its entire portfolio of U.S. hospitality properties amid reduced investor demand for this type of real estate.
Last year, only US$29.6 billion of hotels changed hands, less than half of the total transaction value of the prior year, according to CoStar data.
The US$9.2 billion in sales in the first half of this year was the second-lowest first-half total since the Great Recession in 2008-2009, according to CoStar. Overall transaction activity has been muted by high borrowing costs and disagreements in pricing between buyers and sellers.
Skyline followed up its initial sales effort by marketing its portfolio properties individually or in smaller groups.
Multiple unidentified buyers came through on the purchase of the 11 properties completed in the past week, according to filings with the Tel Aviv Stock Exchange where Skyline is required to file based on previous bond sales in Israel.
The combined price for the 11 properties totaling 1,615 rooms was US$101 million, or about US$62,400 per room. Skyline reported it will record a loss on the sales of US$8.5 million.
The Courtyards sold are: Chicago Arlington Heights, Chicago Deerfield and Chicago Rockford in Illinois; Birmingham Hoover and Huntsville University Drive in Alabama; Manassas Battlefield Park in Virginia; Lexington North in Kentucky; Courtyard Dayton Miamisburg and Courtyard Toledo Airport Holland in Ohio; Courtyard Little Rock West in Arkansas; and the Courtyard Oklahoma City Airport in Oklahoma.
Skyline used proceeds to fully repay US$106 million in debt on the 11 properties.
With the completed sales, Skyline is left with just three Courtyard hotels in Fort Myers, Florida; Ithaca, New York; and Tucson, Arizona, which are up for sale. It also owns two Hyatt hotels in Cleveland.
For the record
Marcus & Millichap's Ebrahim Valliani of the Miller-Gomes Hotel Team represented Skyline in the Courtyard transactions.