HERSHA HOSPITALITY TRUST has sold its Hampton Inn Financial District in Manhattan, New York, for $32.4 million. The 81-room hotel was sold as part of the Hersha’s capital recycling program to Chester, Virginia-based Shamin Hotels headed by President and CEO Neil Amin.
“This transaction highlights Hersha’s ability to successfully execute accretive dispositions and upgrade the portfolio with higher growth hotels in our core markets,” said Harrisburg, Pennsylvania-based Hersha’s Chief Executive Officer Jay Shah. “While we remain bullish on the Manhattan lodging market, this was an opportunistic sale, representing a trailing twelve-month economic capitalization rate of 4.4 percent.”
The deal closed March 6, Amin told the Richmond, Virginia, Times-Telegraph newspaper. “I have been looking for an asset in New York for some time,” Amin said. “This was a great opportunity to buy a premier brand in a prominent neighborhood of Manhattan below replacement cost.”
Shamin operates 53 hotels in Virginia, Maryland, North Carolina, Florida and Colorado, according to the Times-Telegraph. The Hampton Inn Financial District is its furthest flung property.
Hersha has sold 19 hotels for $900 million over the last two years as part of its capital recycling program, Shah said. That includes the 203-room Courtyard by Marriott in Alexandria, Virginia, and the 120-room Residence Inn in Greenbelt, Maryland, which it sold last year for $62 million to The Shidler Group out of Honolulu, Hawaii.
Money from the sale of the Hampton Inn Financial District were used to fund Hersha’s share repurchase program and apply $18 million to pay down its loans, Shah said. Solid Rock Advisors advised Hersha on the sale.