VANCOUVER, BC--(Marketwired - September 01, 2016) - American Hotel Income Properties REIT LP ("AHIP") (TSX: HOT.UN) (OTCQX: AHOTF) announced today the completion of its previously reported 24-room expansion at the existing, high occupancy Oak Tree Inn hotel in North Platte, Nebraska (the "North Platte Property") for a total purchase price of US$2.1 million. AHIP funded the expansion with cash-on-hand and a new US$1.1 million, floating rate mortgage that matures on February 1, 2023. In conjunction with this mortgage, AHIP has also entered into an interest rate swap contract that fixes the interest rate at 4.10% for the full term of the loan.
The expansion is part of AHIP's rail crew growth strategy of constructing additional guestrooms at existing, high-occupancy Oak Tree Inn rail crew hotels. The newly-built guestroom expansion was initiated in response to the high utilization of the North Platte Property by a railway customer and to provide additional capacity for future growth and commercial guests. The expansion was constructed by SunOne Developments Inc. ("SunOne") pursuant to the Master Development Agreement.
Rob O'Neill, Chief Executive Officer of AHIP commented, "AHIP's organic growth strategy is well underway with 120 newly built guestrooms at five properties completed thus far and more growth initiatives currently under review. The North Platte Property is adjacent to the Bailey Yard, the largest rail yard in the world with an average of 139 trains and 14,000 railroad cars passing through every day."
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, references to: the future performance of the North Platte Property and any other expanded Oak Tree Inn hotels.
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 successfully integrate the expanded North Platte Property, and expectations and assumptions related to the expected return on equity and accretion from the expansion of any Oak Tree Inn hotels. 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 17, 2016 and under "Risks and Uncertainties" in AHIP's Management's Discussion and Analysis dated August 9, 2016, 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 rail crew accommodation, transportation-oriented, and select-service lodging sectors. AHIP's hotels 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 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.
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