(Alliance News) - LXi REIT PLC on Monday said that it had exchanged contracts for the sale of several Travelodge-branded hotels, the proceeds of which will be used to help the company's debt position.
The London-based commercial real estate investment trust confirmed that the Travelodge Group will pay GBP210.0 million for the 66 hotels. The company said that this is in line with their book value as of September.
Proceeds from the sale, which is scheduled for completion on February 28, will be used to pay down debt. LXi said that the sale will reduce the group's loan-to-value to 34% from 38%, while reducing Travelodge's proportion of group rent to 11% from 18%.
LXi Chief Executive Officer Simon Lee said: "We are delighted to be transacting with Travelodge on this landmark sale of 66 hotels for GBP210 million, which is in line with the latest book value. Most of the sale proceeds will be used to pay down debt, reducing group LTV to 34%, and Travelodge's proportion of group rent will reduce to 11%. The sale and debt repayment are not expected to have a material impact on the company's earnings."
Shares in LXi were up 0.2% at 103.40 pence each in London on Monday morning.
By Hugh Cameron, Alliance News reporter
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