Summit Hotel Properties Acquires Hampton Inn & Suites Located In Downtown Austin, Texas For $53M

Summit Hotel Properties

(“the Company”) announced today the acquisition of the Hampton Inn & Suites located in downtown Austin, Texas. The acquisition is the first property owned by Summit in the home of their corporate offices. The Company acquired the 209-guestroom Hampton Inn & Suites located in Austin, Texas on September 9, 2014 for a total purchase price of $53.0 million and entered into a management agreement with Interstate Hotels & Resorts. The property was built in 2002 and the Company anticipates spending approximately $2.4 million in capital improvements over the next twelve months. The Company estimates a post-renovation next twelve month (“NTM”) capitalization rate in the range of 8.00 percent to 8.50 percent based on management's current projection of future net operating income. The Company expects the hotel to generate approximately $1.4 million of adjusted earnings before interest, taxes, depreciation and amortization (“EBITDA”) through the balance of 2014. “We are thrilled with the acquisition of our first property in the robust and dynamic Austin market,” said Company President and CEO Dan Hansen. “The Hampton Inn & Suites is a wonderful addition to our portfolio in one of the fastest growing cities in the country.” The 16-story Hampton Inn & Suites is located in downtown Austin, Texas, one block from the Austin Convention Center and Lady Bird Lake, in the central business district. Austin has seen continued increases in demand from large corporate accounts, convention business and strong leisure demand. The capitol city is home to the headquarters or regional offices of many Fortune 500 companies, including Apple Inc., eBay, Google, IBM, Texas Instruments, Whole Foods and Dell. Live music, sports and entertainment events in the city known as the Live Music Capital of the World®, include Austin City Limits Music Festival (“ACL”), South by Southwest (“SXSW”), Formula 1 and the University of Texas Longhorn football.