PHILADELPHIA—Hersha Hospitality Trust announced that the company has closed on a new $500 million senior unsecured credit facility that is expandable to $850 million. The credit facility consists of a $250 million senior unsecured revolving line of credit and a $250 million senior unsecured term loan. This new facility amends and restates the company’s existing $400 million senior secured revolving credit facility.
“We appreciate the financial community’s extraordinary support in the refinancing and enhancing of our facility. The new facility affords the company greater financial flexibility, extends our debt maturities, and reduces our weighted average cost of debt,” commented Ashish R. Parikh, chief financial officer. “We were particularly encouraged by the oversubscription of the facility by the bank group. The level of interest demonstrated confidence in the company’s strategic direction, conservative balance sheet, and the inherent value of our high quality, urban transient hotel portfolio.”
The interest rate for the revolving credit facility is based on a pricing grid with a range of 170 to 245 basis points over LIBOR, based on the company’s leverage ratio. Pricing for the term loan is LIBOR plus 160 to 235 basis points also based on the company’s leverage ratio. The company will use the new facility for general corporate purposes.