Business Context and Reporting Period
This Form 8-K is filed by Apple REIT Nine, Inc. (a subsidiary of Apple Hospitality REIT, Inc.) for the reporting period ending December 30, 2008. The filing reports the completion of asset acquisitions under Item 2.01.
Key Financial Metrics and Transaction Details
The Company closed on the purchase of four hotels between December 30 and December 31, 2008. The total aggregate purchase price was $67,398,211 for 426 rooms. The transaction was funded through ongoing offerings of Units (consisting of one common share and one Series A preferred share).
| Location | Franchise | Rooms | Purchase Price | Closing Date |
|---|---|---|---|---|
| Jackson, Tennessee | Hampton Inn & Suites | 83 | $12,600,000 | Dec 30, 2008 |
| Fort Lauderdale, Florida | Hampton Inn | 109 | $19,290,434 | Dec 31, 2008 |
| Pittsburgh, Pennsylvania | Hampton Inn | 132 | $20,457,777 | Dec 31, 2008 |
| Frisco, Texas | Hilton Garden Inn | 102 | $15,050,000 | Dec 31, 2008 |
| Total | - | 426 | $67,398,211 | - |
Revenue, profit, cash flow, margins, debt, and liquidity metrics for the Company are not provided in this specific filing text.
Material Changes and Adjustments
The purchase prices for the Fort Lauderdale and Pittsburgh properties were adjusted to account for the defeasance of two existing loans secured by these properties. These four acquisitions represent the completion of four closings under a series of purchase contracts executed on November 12, 2008, which covered a potential total of eight hotels.
Outlook, Risks, and Contingencies
There is no assurance that further closings will occur under the remaining purchase contracts from the November 12, 2008 agreement. Financial statements for the acquired businesses and pro forma financial information are not included in this report but will be filed as necessary by amendment within the required time period.
Investor Verification Checklist
- Verify the status of the remaining four hotels under the November 12, 2008 purchase contracts.
- Review the upcoming amended filings for financial statements of the acquired businesses and pro forma financial information.
- Confirm the impact of the defeasance adjustments on the final cost basis for the Fort Lauderdale and Pittsburgh properties.
- Assess the dilution impact of the Unit offerings used to fund the $67.4 million acquisition.