November 09, 2015 – MONTERREY, Mexico – Deutsche Bank Mexico, S.A., Banking institution, Trust Division F/1616 or Fibra Inn (BMV: FINN13) (“Fibra Inn” or “the Company”), the hotel industry specialized Mexican real estate investment trust, serving the business traveler with international brands, announced today the signing of a purchase agreement to acquire four hotels in the state of Chihuahua totaling 551 rooms. These are:
Hampton Inn by Hilton Chihuahua
Courtyard by Marriott Chihuahua
City Express Chihuahua
City Express Junior Chihuahua
The business fundamentals employed by Fibra Inn for the acquisition of these hotels are the following:
- Market Strength: Chihuahua is a consolidated state in the north of Mexico; it has a diversified industry and is a leader in manufacturing and export activities due to its proximity to the U.S.
- Economic Growth: During the past four years Chihuahua average annual GDP growth rate has been 5.4%.
- Diversified Industry: The state’s economy is supported by a large number of companies, including: Ford, Grupo Bafar, Interceramic, Honeywell Aerospace, Delphi, Cementos Chihuahua, American Industries, Textron, Visteon Corporation, Fokker Aerospace, Heineken, Emerson, Laminal and Jabil.
- Private Investments: A number of companies have initiated significant investments in the state. Such is the case of Ford, which began expanding its plant in the Industrial Manufacturing Complex of Chihuahua with an investment of US$ 1. 3 billion. Heineken who will build a plant in Meoqui with an investment of Ps. 7.5 billion, expected to start operations in 2017.
Oscar Calvillo, Fibra Inn’s Chief Executive Officer, stated: “The acquisition of these four hotels consolidates our leadership position in Chihuahua, where we will now operate nine hotels. The 9.4% consolidated cap rate for the combined properties for 2016 is based on the outstanding economic performance of the state of Chihuahua. We continue to review purchase opportunities to continue adding suitable properties to the Fibra.”
The acquisition price of Ps. 678.7 million, plus taxes and acquisition-related expenses, as well as the corresponding VAT, will be paid using proceeds from the debt issuance.
With these acquisitions, Fibra Inn has a portfolio of 41 hotels: 39 in operation and two under development, with a total of 6,834 rooms; 548 of these are currently under construction. Fibra Inn’s corporate governance committees approved the purchase of these properties. Fibra Inn will be in charge of the operation of the four hotels.
Hampton Inn by Hilton Chihuahua
Periférico de la Juventud No. 6100, Fraccionamiento Las Haciendas, 31236, Chihuahua, Chih.
The acquisition price will be Ps. 322.2 million, plus Ps. 11.4 million that will be used for taxes and acquisition-related expenses. Additionally, the Company has budgeted Ps. 5.0 million for property improvements. The hotel operates 190 rooms in the select-service segment.
The Hampton Inn by Hilton Chihuahua hotel is a leader in the area and is the only Hilton hotel located in the city. In addition, the hotel operates under the Hampton Inn by Hilton brand, which has one of the highest room rates in Mexico. The hotel is located in the largest real estate development corridor, which includes retail, residential and office buildings. The property has 71% occupancy levels, an average daily rate (“ADR”) of Ps. 1,297 and RevPar of Ps. 917 for the accumulated January to September 2015 period.
Courtyard by Marriott Chihuahua
Periférico de la Juventud s/n, Desarrollo Comercial El Saucito, 31110, Chihuahua, Chih.
The acquisition price will be Ps. 234.4 million, plus Ps. 8.7 million that will be used for taxes and acquisition-related expenses. The hotel, which is currently under construction, will be ready to start operations during the first quarter of 2016 and the Company expects to execute the franchise agreement by then. The hotel will operate 152 rooms in the select-service segment.
The Courtyard by Marriott Chihuahua hotel has a high performance potential from being a well-positioned brand in the U.S. market and will be the first and only Marriott brand hotel in Chihuahua. The hotel is located in the largest real estate development corridor, which includes retail, residential and office buildings.
City Express Chihuahua
Periférico de la Juventud No. 6108, Desarrollo Comercial El Saucito, 31110, Chihuahua, Chih.
The acquisition price will be Ps. 86.8 million, plus Ps. 3.8 million that will be used for taxes and acquisition-related expenses. Additionally, the Company has budgeted Ps. 2.5 million for property improvements. The hotel operates 104 rooms in the select-service segment.
The City Express Chihuahua will be the first hotel operating under this brand in Fibra Inn’s portfolio. It is located in a premium, mixed-use real estate complex and is surrounded by popular restaurants. The property has 74% occupancy levels, an ADR of Ps. 785 and RevPar of Ps. 580 for the accumulated January to September 2015 period.
City Express Junior Chihuahua
Av. Cristóbal Colón esquina Jorge Luis Bordes No. 100, Complejo Industrial Chihuahua, 31109, Chihuahua, Chih.
The acquisition price will be Ps. 35.3 million, plus Ps. 2.2 million that will be used for taxes and acquisition-related expenses. Additionally, the Company has budgeted Ps. 1.5 million for property improvements. The hotel operates 105 rooms in the limited service segment.
The City Express Junior Chihuahua hotel is located next to Ford’s manufacturing plant, which recently announced a US$ 1.3 billion investment. The property has 56% occupancy levels, an ADR of Ps. 542 and RevPar of Ps. 303 for the accumulated January to September 2015 period.
Note on Forward-Looking Statements
This press release may contain forward-looking statements. These statements are statements that are not historical facts, and are based on management’s current view and estimates of future economic circumstances, industry conditions, Company performance and financial results. Also, certain reclassifications have been made to make figures comparable for the periods. The words “anticipates”, “believes”, “estimates”, “expects”, “plans” and similar expressions, as they relate to the Company, are intended to identify forward-looking statements. Statements regarding the declaration or payment of dividends, the implementation of principal operating and financing strategies and capital expenditure plans, the direction of future operations and the factors or trends affecting financial condition, liquidity or results of operations are examples of forward-looking statements. Such statements reflect the current views of management and are subject to a number of risks and uncertainties. There is no guarantee that the expected events, trends or results will actually occur. The statements are based on many assumptions and factors, including general economic and market conditions, industry conditions, and operating factors. Any changes in such assumptions or factors could cause actual results to differ materially from current expectations.
