VANCOUVER, May 6, 2014 /PRNewswire/ - American Hotel Income Properties REIT LP ("AHIP") (TSX: HOT.UN; OTCQX: AHOTF) today announced the grand opening of its 34th Oak Tree Inn and its 24th Penny's Diner.
The 56-room Oak Tree Inn hotel and Penny's Diner located in Santa Teresa, New Mexico (the "Property") was constructed by SunOne Developments Inc. ("SunOne") in accordance with the Master Development Agreement dated February 20, 2013 and filed on SEDAR (www.sedar.com). Following the official ribbon cutting by Jon Barela, Cabinet Secretary for the New Mexico Economic Development Department, and representatives of AHIP, SunOne, TR Lodging Enterprises, and the railway client, the Property is welcoming its first railway guests today with a hotel occupancy of 100%.
AHIP acquired the Property on May 1, 2014 for a total purchase price of US$5.1 million. US$1.0 million of the purchase price was paid by AHIP in 101,247 newly-issued HOT.UN units, with the remainder of the purchase price paid using a combination of mortgage financing and available cash.
Mr. Rob O'Neill, Chief Executive Officer of AHIP commented, "This grand opening is the first of four previously announced development properties for railway clients to be completed by SunOne. We are pleased with this high quality addition to our Oak Tree Inn portfolio. SunOne met all of our expectations on the basis of cost, timing, and quality. Currently forecasted business levels are so strong that we are considering an expansion of the Property to meet transient demand created by the adjacent railway infrastructure project at Santa Teresa."
Secretary Barela addressed the group attending the ribbon cutting ceremony, sent greetings from the Governor, and thanked AHIP for investing in New Mexico and the Santa Teresa community. According to the Albuquerque Journal on April 14th, "The unprecedented boom in business activity at Santa Teresa has brought nearly two dozen new companies to the industrial parks in the past two years. Last month alone, six companies announced plans to build here."
"WHEN REST MATTERS"
John O'Neill, President of TR Lodging Enterprises, commented at the ribbon cutting ceremony, "Increasing transient guest volumes at Oak Tree Inn hotels has been an objective of AHIP and TR Lodging Enterprises, which developed the brand tagline When Rest Matters in order to accurately position the Oak Tree Inn brand within the marketplace. The slogan describes our advantage over economy and midscale hotels that do not offer the 'dark and quiet' features of Oak Tree Inn hotels." The online reservations system and www.oaktreeinn.com website have also been enhanced for ease of use. An enhanced exterior and highway marker signage program is underway to increase the visibility of locations with the potential for drive-by guest demand.
ABOUT CABINET SECRETARY JON BARELA
Jon Barela is the Cabinet Secretary for the New Mexico Economic Development Department. He was appointed by Governor Susana Martinez and confirmed unanimously by the New Mexico State Senate. Secretary Barela has helped bring significant investments to the state, resulting in a significant growth in the state's economy, including the construction, transportation and logistics industries. For more information please visit: www.gonm.biz/about_nmedd.aspx
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 engaged primarily in the railway employee accommodation, transportation, and contract-focused lodging sectors. 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.
This news release contains forward-looking information within the meaning of applicable securities legislation, which reflects AHIP's current expectations regarding future events. Events such as the completion of the other three previously announced development properties to be completed by SunOne, the future expansion of the Property, and the future performance of the Property are subject to a number of risks and uncertainties, many of which are beyond AHIP's control, and could cause actual results and events to differ materially from those that are disclosed in, or implied by, such forward-looking information.
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SOURCE American Hotel Income Properties REIT LP