Temple Real Estate Investment Trust (Temple REIT) has completed the previously announced acquisition of the Hilton Garden Inn West Edmonton in a deal worth $31m.
Located close to Edmonton’s West End Business District and the West Edmonton Mall, the six-storey, 160-room hotel is suited for both business and leisure travel.
According to Temple REIT, the acquisition value was funded by a first mortgage loan of $20m and the rest in cash, and is subject to the usual closing adjustment.
Bearing interest at a rate of 5.1%, the first mortgage loan has a three-year term with a 25-year amortisation.
The Canada-based REIT will invest $2m over the next 18 months for renovation of the hotel’s guest rooms, corridors and lobby.
Opened in 2004, the Hilton Garden Inn West Edmonton features five executive suites that have private seating areas, Jacuzzi tubs and two-way fireplaces.
Other facilities include 4,049ft² of banquet and meeting space, a heated indoor pool, whirlpool and fitness room, a restaurant and lounge, 206 surface parking spaces, a market pantry, a business centre, guest laundry facilities and a vending area.
Based on the 2012-13 forecasted net income, the total investment in the hotel, including capital expenditures, represents a capitalisation rate of about 10.31%.
Temple REIT’s mission is to provide unitholders with stable cash distributions from investment in a diversified portfolio of hotel properties and related assets.