VANCOUVER,
July 2, 2015 /PRNewswire/ - American
Hotel Income Properties REIT LP ("AHIP") (TSX: HOT.UN;
OTCQX: AHOTF) announced today increased room commitments at the
recently acquired 50-room Oak Tree Inn hotel located in
Glendive, Montana (the
"Glendive Property"). The railway customer at the
Glendive Property is taking their daily room commitment from 40
guestrooms to 55 guestrooms. In order to accommodate this increased
demand, AHIP has entered into an agreement with SunOne Developments
Inc. ("SunOne") to construct a 24-room expansion at the
Glendive Property for a total purchase price of US$2.8 million. The expansion is part of AHIP's
previously announced railway growth strategy of constructing
additional guestrooms at existing, high occupancy Oak Tree Inn
railway hotels.
The Glendive Property is currently operating at
high occupancy levels and is secured by a long-term railway
contract. The expansion is expected to generate a double-digit year
one return on equity and will be immediately accretive to
unitholders. Construction will commence right away with completion
targeted for late-2015.
Mr. Rob O'Neill,
Chief Executive Officer of AHIP commented, "We are delighted to
announce that increased rail activity has generated demand for
additional guestrooms. The expansion provides AHIP with the
opportunity to capture both rail and transient demand. The
guestrooms will be purpose built to industry leading Oak Tree Inn
standards and will also feature additional amenities to accommodate
higher-rated extended stay guests. The Glendive Property
expansion and the previously announced expansion in Dexter, Missouri are expected to add another
48 rooms to the rail portfolio by the end of the year. We
continue to evaluate various accretive growth opportunities for the
Oak Tree Inn portfolio."
Mr. O'Neill continued, "I am also pleased to
advise that the previously announced multi-year 50-room daily room
commitment at the AHIP-owned Holiday Inn Oklahoma City Airport will
welcome its first railway customers on July
15, 2015."
Forward-Looking Information
Certain statements contained in this news
release may constitute forward-looking statements. Forward-looking
statements are often, but not always, identified by the use of
words such as "anticipate", "plan", "expect", "may", "will",
"intend", "should", and similar expressions. These statements
involve known and unknown risks, uncertainties and other factors
that may cause actual results or events to differ materially from
those anticipated in such forward-looking statements.
Forward-looking statements in this news release include, without
limitation, the references to the following: the proposed expansion
of the Glendive Property and the expected completion timing
therefor; the increase of the minimum room guarantee at the
Glendive Property; the return on
equity expected to be generated by the proposed expansion of the
Glendive Property; the expectation that the proposed expansion of
the Glendive Property will be immediately accretive to unitholders;
future occupancy of the Glendive Property; the expansion of the Oak
Tree Inn hotel in Dexter Missouri;
expansions of other Oak Tree Inn hotels and the multi-year contract
at the Holiday Inn.
Forward-looking information is based on a number
of key expectations and assumptions made by AHIP, including,
without limitation: a reasonably stable North American economy and
stock market, the continued strength of the U.S. lodging industry,
the ability to secure financing, the ability to successfully
integrate the Glendive Property and expectations and assumptions
related to the expected return on equity and accretion from the
expansion of the Glendive Property. Although the forward-looking
information contained in this news release is based on what AHIP's
management believes to be reasonable assumptions, AHIP cannot
assure investors that actual results will be consistent with such
information.
Forward-looking information reflects current
expectations of AHIP's management regarding future events and
operating performance as of the date of this news release. Such
information involves significant risks and uncertainties, should
not be read as guarantees of future performance or results, and
will not necessarily be accurate indications of whether or not such
results will be achieved. Actual results could differ materially
from those currently anticipated due to a number of factors and
risks. These include, without limitation, those factors that can be
found under "Risk Factors" in AHIP's Annual Information Form dated
March 27, 2015 and under "Risks and
Uncertainties" in AHIP's Management's Discussion and Analysis dated
May 13, 2015, both of which are
available on SEDAR at www.sedar.com.
The forward-looking statements contained herein
represent AHIP's expectations as of the date of this news release,
and are subject to change after this date. AHIP assumes no
obligation to update or revise any forward-looking statements
whether as a result of new information, future events or otherwise,
except as required by applicable law.
ABOUT AMERICAN HOTEL INCOME PROPERTIES REIT
LP
AHIP is a limited partnership formed under the
Limited Partnerships Act (Ontario) to invest in hotel real estate
properties located substantially in the
United States and is engaged primarily in the railroad
employee accommodation, transportation-oriented, and select-service
lodging sectors. AHIP's properties are mostly located in secondary
and tertiary markets in the United
States in close proximity to railroads, airports, highway
interchanges, and other demand generators. AHIP owns hotels serving
the U.S. rail industry pursuant to long-term railway contracts and
hotels affiliated with leading national and international hotel
brands. AHIP's long-term objectives are to: (i) generate stable and
growing cash distributions from hotel properties substantially in
the U.S.; (ii) enhance the value of its assets and maximize the
long-term value of the hotel properties through active management;
and (iii) expand its asset base and increase its AFFO per unit
through an accretive acquisition program, participation in
strategic development opportunities and improvements to its
properties through targeted value-added capital expenditure
programs.
ADDITIONAL INFORMATION
Additional information relating to AHIP,
including its other public filings, is available on SEDAR at
www.sedar.com and on AHIP's website at www.ahipreit.com.
THE TORONTO
STOCK EXCHANGE HAS NOT REVIEWED
AND DOES NOT ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR THE ACCURACY
OF THIS NEWS RELEASE.
SOURCE American Hotel Income Properties REIT LP