Exchange of Contracts on sale of Travelodge hotels
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION
8 January 2024
LXi REIT plc
(the "Company", the "Group" or "LXi")
EXCHANGE OF CONTRACTS ON THE SALE TO TRAVELODGE OF 66 HOTELS FOR £210 MILLION, WHICH IS IN LINE WITH LATEST BOOK VALUE
LXi REIT plc, the specialist inflation-protected very long income REIT, is pleased to announce that it has exchanged contracts unconditionally on the sale of 66 Travelodge branded hotels to the Travelodge group for £210 million, which is in line with the latest (30 September 2023) book value.
As announced on 22 November 2023, the majority of the sale proceeds will be used to pay down debt, reducing Group LTV to 34% from 38% and reducing Travelodge's proportion of Group rent to 11% from 18%.
The sale and debt repayment are not anticipated to have a material impact on the Company's earnings given the debt cost savings.
Completion of the sale is scheduled to occur on 28 February 2024.
Commenting on the transaction Simon Lee, CEO of LXI REIT Advisors, said:
"We are delighted to be transacting with Travelodge on this landmark sale of 66 hotels for £210 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. Travelodge operates a best-in-class hotels business and the firm commitment of its owners to the business is demonstrated by their support to enable the purchase of 66 of its assets."
Jo Boydell, Chief Executive of Travelodge, said:
"The acquisition of 66 Travelodge hotels from LXi REIT, with support from our owner GoldenTree Asset Management, will mark a positive step for Travelodge as we seek to optimise our hotel portfolio and diversify our freehold/leasehold split to enhance value. The new structure will provide us with a platform to explore further freehold acquisitions. We have nearly four decades of expertise in operating budget hotels and we look forward to continuing to invest in our hotel network to drive growth."
FOR FURTHER INFORMATION, PLEASE CONTACT:
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LXI REIT Advisors Limited Simon Lee (CEO) Alex MacEachin (CFO) |
Via H/Advisors Maitland |
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H/Advisors Maitland (Communications Advisor) James Benjamin Rachel Cohen |
lxireit-maitland@h-advisors.global 07747 113 930 020 7379 5151 |
The Company's LEI is: 2138008YZGXOKAXQVI45
NOTES
LXI REIT plc invests in commercial property assets predominantly in the UK, let, or pre-let, on long (typically 20 to 30 years to expiry or first break), inflation-linked leases to a wide range of strong tenant covenants across a diverse range of robust property sectors.
The Company may invest in fixed-price forward funded developments, provided they are pre-let to an acceptable tenant and full planning permission is in place. The Company will not undertake any direct development activity nor assume direct development risk.
The Company is targeting a dividend of 6.6 pence per ordinary share for the year which commenced on 1 April 2023*.
The Company, a real estate investment trust ("REIT") incorporated in England and Wales, is listed on the premium listing segment of the Official List of the UK Financial Conduct Authority and was admitted to trading on the main market for listed securities of the London Stock Exchange in February 2017.
The Company is a constituent of the FTSE 250, EPRA/NAREIT, MSCI and STOXX Europe 600 indices.
Further information on the Company is available at www.lxireit.com
* This is a target and not profit forecast.
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