AR Capital Hospitality Trust Terminates $192.4 Million Portfolio Purchase
American Realty Capital Hospitality Trust Inc., a publicly registered non-traded real estate investment trust, terminated its agreement to purchase the remaining nine hotels in the 13-property Noble Portfolio for approximately $192.4 million.
The REIT was originally contracted to purchase the portfolio in four separate transactions from affiliates of Noble Investment Group LLC, a lodging and hospitality real estate private equity firm.
As previously reported by The DI Wire, the REIT closed on four of the hotels in November and December 2015. The first purchase included two hotels in Chicago and Monterrey, California for $48.6 million, while the other two properties were located in Atlanta and Columbus, Ohio and purchased for $59 million.
The final two purchases were scheduled to close on February 29, 2016 and March 31, 2016.
As a result of this termination, American Realty Capital Hospitality Trust forfeited its $22 million non-refundable earnest money deposit.
Earlier this month, the REIT terminated an agreement to purchase 10 hotels for $89 million from Summit Hotel OP and forfeited a $9.1 million earnest money deposit.
ARC Hospitality’s investment strategy focuses on acquiring stable, institutional quality and strategically located lodging properties in North America branded by premium national hotel brands. The REIT’s current lodging portfolio is comprised of 136 hotels totaling 16,644 rooms across 32 states.
In November 2015, AR Capital, the REIT’s sponsor, announced that it will stop offering and selling new investment products after December 31st, including shares of American Realty Capital Hospitality Trust. A series of scandals surrounding the sponsor and Realty Capital Securities, the dealer manager, led to the termination of all AR Capital-sponsored investment programs and an agreement by RCS to terminate its business.
