Ashford Hospitality Trust, a U.S. real estate investment trust with 75 hotels and about 18,000 hotel rooms, recently refinanced the Renaissance Nashville, one of the best-performing hotels under the Renaissance brand.
By replacing the downtown Nashville property's prior loan of $241.7 million, which was backed by the REIT's Westin Princeton hotel in Princeton, New Jersey, Ashford Hospitality is now placing the 296-room Princeton hotel on the market.
The REIT's new loan for the Renaissance Nashville — a 674-room, upper-upscale hotel — is a $267.2 million non-recourse loan. The two-year, floating-rate, interest-only loan has three one-year extensions with a final maturity date in March 2026, according to a statement from the REIT.
Ashford Hospitality plans to use some of the proceeds from the deal for general corporate purposes, including paying down debt, officials said.
Ashford Hospitality's President and CEO Rob Hays, who is stepping down from the company at the end of June, said in a statement the new loan had "attractive terms with significant excess proceeds" benefiting the trust.
"We continue to make solid progress in paying off our strategic financing and have several assets in the market at various stages of the sales process," Hays said in a statement. The REIT recently told investors it has lined up buyers for 11 of its U.S. hotels that could bring $625 million to the trust to help shore up its finances.
The Renaissance Nashville was valued at $407 million at the time of the refinancing, according to a Morningstar DBRS report on the commercial mortgage-backed securities loan.
The Renaissance Nashville is within walking distance of Music City Center, the main convention center of Nashville, and has served as an anchor to the city's lodging market, according to Morningstar DBRS' report. In 2019, the hotel underwent $12.2 million in renovations updating the lobby, restaurants, president suite and portions of the hotel.
The hotel's other amenities include two eateries, Little Fib and Bridge Bar, retail space and 112,498 square feet of meeting spaces with ballrooms and breakout rooms. A fitness center, lounge and indoor pool with sundecks opened to guests this month.
The Renaissance Nashville is the third best-performing hotel under the Renaissance brand, which is owned by Marriott International, the world's largest hotel company, according to the Morningstar DBRS report.
The hotel's revenue per available room was $230.93 at the end of the first quarter, according to the report. Analysts with Morningstar DBRS expect moderate room-rate growth because of the hotel's location, capital improvements and experienced sponsorship.
"While average RevPAR continued to increase in 2023, the pace of RevPAR growth has begun to slow," analysts with Morningstar DBRS said in the report.
For the Record
Bank of America NA originated the two-year, floating-rate loan for Ashford Hospitality Trust. Newmark Valuation & Advisory prepared the valuation for the property as part of the refinancing.