Winston (NYSE:WXH)
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Winston Hotels, Inc. (NYSE: WXH), a real estate
investment trust (REIT) and owner of premium limited-service, upscale
extended-stay and full-service hotels, today announced that it has
closed on an $8.5 million loan to finance the development of a
101-room Hampton Inn & Suites in Murfreesboro, Tenn. The total
estimated cost of the project, which is being developed by Host
Murfreesboro, LLC, is $10.2 million.
In addition, the company announced the sale of the Holiday Inn
Select in Garland, Texas and declared its regular quarterly dividends.
Hampton Inn & Suites Loan
The $8.5 million loan is part of Winston's debt financing program,
which provides loans to build, renovate or acquire hotels. The
five-year loan requires payments at an interest rate of 30-day LIBOR
plus 3.60 percent, with another 1.0 percent of the original principal
balance accruing until the loan is paid in full. Payments are interest
only during construction of the hotel and the first 12 months of hotel
operations and thereafter include principle payments based on a
25-year amortization period. "The Murfreesboro project has a lot going
for it, including a premium brand and a prime location in an urban
market with solid growth potential," said Joe Green, president and
chief financial officer.
"Winston's unique combination of hotel experience and lending
expertise made them an attractive and logical source of funding for
this project," said Bryan Nearn, Chief Manager of Host Murfreesboro,
LLC.
The four-story hotel will be located on the west side of Thompson
Lane, placing it between two Interstate 24 interchanges--Old Fort
Parkway and Medical Center Parkway. The property is within a short
distance of the downtown area, the main Murfreesboro exit and a new
roadway and growth corridor.
Hotel Sale
The company recently sold the 242-room Holiday Inn Select in
Garland, Texas, a Dallas suburb, for net cash proceeds totaling $4.4
million, resulting in a net gain on sale of approximately $0.5
million. Proceeds were used to pay down a portion of the company's
outstanding indebtedness.
"We continue to refine our hotel portfolio, replacing older
properties and those that are no longer consistent with our long-term
strategies with new, more strategic assets," Green said. "We currently
have three hotels under construction and have an active acquisition
pipeline."
Dividend
Winston's board of directors declared the company's regular
quarterly cash dividend for the 2006 second quarter on its common and
preferred shares. The cash dividend of $0.15 per common share is
payable on July 14, 2006 to common shareholders of record on June 30,
2006. Based on yesterday's closing price of $10.67 per common share,
the annualized dividend yield is 5.6 percent.
The board also declared a cash dividend of $0.50 per Series B
Cumulative Preferred share for the second quarter of 2006. The cash
dividend is payable on July 14, 2006, to preferred shareholders of
record on June 30, 2006.
About the Company
Currently, the company owns or is invested in 54 hotel properties
in 18 states having an aggregate of 7,276 rooms. This includes 47
wholly owned properties with an aggregate of 6,328 rooms, a 60 percent
ownership interest in a joint-venture that owns one hotel with 138
rooms; a 49 percent ownership interest in a joint venture that owns
one hotel with 118 rooms, a 48.78 percent ownership interest in a
joint venture that owns one hotel with 147 rooms, and a 13.05 percent
ownership interest in a joint venture that owns four hotels with an
aggregate of 545 rooms. Currently, the company also has hotel loan
commitments totaling $71.4 million. The company does not hold an
ownership interest in any of the hotels for which it has provided
financing. For more information about Winston Hotels, visit the
company's Web site at www.winstonhotels.com.
Notes About Forward-Looking Statements
In addition to historical information, this press release contains
forward-looking statements. The reader can identify these statements
by use of words like "may," "will," "expect," "project," "anticipate,"
"estimate," "target," "believe," or "continue" or similar expressions,
including without limitation its acquisition, disposition and
development plans for hotel properties, its hotel lending plans, and
its dividend policy. These statements represent the company's judgment
and are subject to risks and uncertainties that could cause actual
operating results to differ materially from those expressed or implied
in the forward looking statements including, but not limited to,
changes in general economic conditions, lower occupancy rates, lower
average daily rates, acquisition risks, development risks including
risk of construction delay, cost overruns, occupancy and governmental
permits, zoning, the increase of development costs in connection with
projects that are not pursued to completion, the risk of non-payment
of subordinated loans, or the failure to make additional hotel debt
investments and investments in hotels. Other risks are discussed in
the company's filings with the Securities and Exchange Commission,
including but not limited to its Annual Report on Form 10-K for the
year ended December 31, 2005.