SOURCE: American Hotel Income Properties REIT LP

American Hotel Income Properties REIT LP

July 26, 2016 08:25 ET

American Hotel Income Properties REIT LP Announces Completion of CDN$103.5 Million Bought Deal

VANCOUVER, BC--(Marketwired - July 26, 2016) -


American Hotel Income Properties REIT LP ("AHIP") (TSX: HOT.UN) (OTCQX: AHOTF) announced today the completion of its previously announced public offering (the "Offering") of 10,000,400 limited partnership units (each a "Unit"), on a bought deal basis, at a price of Cdn$10.35 per Unit, for total gross proceeds of Cdn$103.5 million. The total gross proceeds include the full exercise of the over-allotment option of 1,304,400 Units for additional proceeds of Cdn$13.5 million. The Offering is fully described in AHIP's short form prospectus dated July 18, 2016 (the "Prospectus"), which is available on SEDAR at

The Offering was conducted through a syndicate of underwriters led by CIBC Capital Markets and included National Bank Financial Inc., Canaccord Genuity Corp., TD Securities Inc., Scotiabank, BMO Capital Markets, RBC Capital Markets, Haywood Securities Inc. and Industrial Alliance Securities Inc.

As described in the Prospectus, AHIP intends to use the net proceeds of the Offering to: (i) partially fund the acquisition of the two-high quality Embassy Suites by Hilton hotels located in Dallas, Texas and Tempe, Arizona (the "Embassy Suites Portfolio"); (ii) partially fund the potential acquisition of a nine-property, branded hotel portfolio (the "Multi-Hotel Branded Portfolio"); (iii) partially fund the potential acquisition of two rail crew lodging facilities (the "Rail Crew Hotels"); and (iv) fund working capital and for general corporate purposes. In the event that one or more of the acquisitions do not close, the net proceeds may be used for other potential future acquisitions and/or for working capital and general corporate purposes.

Rob O'Neill, CEO said "We are pleased to have the support of both equity and debt markets as we continue to actively pursue a robust pipeline of high quality rail crew and branded hotels throughout the U.S."

The Units sold pursuant to the Offering have been listed on the Toronto Stock Exchange ("TSX") under AHIP's existing trading symbol HOT.UN. AHIP now has 45,086,159 Units issued and outstanding.

These securities have not been, and will not be, registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of such Act. This news release does not constitute an offer for sale of these securities in the United States.


This news release contains forward-looking information within the meaning of applicable securities legislation, which reflects AHIP's current expectations regarding future events. Forward-looking information is identified by the use of terms and phrases such as "anticipate", "believe", "budget", "could", "estimate", "expect", "going-in", "intend", "may", "opportunities", "plan", "potential", "predict", "project", "will", "would" and similar terms and phrases, including references to assumptions. Such information includes, but is not limited to: the use of proceeds from the Offering, including, without limitation, to partially fund the potential acquisition of each of the Embassy Suites Portfolio, Multi-Hotel Branded Portfolio and Rail Crew Hotels. Actual events or results may differ materially.

Forward-looking information contained in this news release is based on certain key expectations and assumptions made by AHIP, including, without limitation those with respect to: a reasonably stable North American economy and stock market; the acquisition, conversion and successful integration, as applicable, of the Embassy Suites Portfolio, Multi-Hotel Branded Portfolio and Rail Crew Hotels; and the U.S. hotel and lodging industry, including competition for acquisitions, will be consistent with the economic climate. Although the forward-looking information contained in this news release is based upon what AHIP's management believes to be reasonable assumptions, AHIP cannot assure investors that actual events or results will be consistent with such information. Forward-looking information reflects current expectations of 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. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking information, and a description of these factors can be found under "Risk Factors" in the Prospectus, under "Risk Factors" in AHIP's Annual Information Form dated March 17, 2016 and under "Risks and Uncertainties" in AHIP's Management's Discussion and Analysis dated May 11, 2016, each of which are available on SEDAR at

The forward-looking information contained herein is expressly qualified in its entirety by this cautionary statement. The forward-looking information is made as of the date of this news release and AHIP assumes no obligation to update or revise such information to reflect new events or circumstances, except as may be required by applicable law.

The potential acquisitions and conversions described in this news release are indicative only, as these potential transactions are being evaluated and negotiated with the applicable sellers. In addition, each transaction, if it proceeds, would be subject to conditions, including satisfactory completion of AHIP's due diligence and negotiation or assignment of railway contracts, as applicable, and negotiation of formal legal documents. For example, AHIP cautions that there can be no assurance that any such transaction will complete, or what the terms of such a transaction, if any, may be. AHIP undertakes no obligation to update investors on the status of any potential transactions described in this news release unless and until all key conditions are satisfied and the Board of Directors of AHIP's general partner has approved the transaction, in each case.


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 rail crew 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 currently owns 80 hotels including 45 hotels serving the U.S. rail industry pursuant to long-term rail crew contracts and 35 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 relating to AHIP, including its other public filings, is available on SEDAR at and on AHIP's website at


Contact Information

    Andrew Greig
    Investor Relations
    American Hotel Income Properties REIT LP
    Suite 1660 - 401 West Georgia Street
    Vancouver, B.C. V6B 5A1
    Phone: (604) 633-2857