DENVER—This month, RLH Corporation announced the sales of Red Lion Hotel Port Angeles for $19.5 million and Hotel RL Spokane at the Park for $35 million. These hotels are the eighth and ninth, respectively, of 11 hotels being marketed for sale previously disclosed in October 2017. Red Lion Hotel Port Angeles, along with all other sold hotels, has signed a franchise license agreement to retain their Red Lion brand.
“With these sales, we have continued progress on our commitment to an asset-light company and have been able to repay the long-term debt relating to those assets and increase cash reserves and debt capacity to fund additional growth of our franchise business,” said RLH Corporation President and Chief Executive Officer Greg Mount.
RLH Corporation’s total gain on the sales is expected to be approximately $11.5 million for the Red Lion Hotel Port Angeles and approximately $14.8 million for Hotel RL Spokane. Together with the other previously announced sales, RLH Corporation’s gain on sales is approximately $42.2 million.
“With the completion of the Spokane sale we have now completed nine of the 11 targeted real estate sales,” Mount said. “We continue to see strong real estate market conditions and are optimistic that we will complete the sale of the final two assets prior to yearend. Given the strong real estate market conditions we have begun to market our interests in our hotel in Atlanta, and in our leased hotels in Anaheim and Kalispell, Montana reinforcing our asset-light strategy and enhancing our liquidity and capital capacity to be available for the growth of our franchise business.”
Red Lion Hotel Port Angeles accounted for $1 million in revenue in Q1 2018 and $7.2 million in revenue on an annual basis in 2017. The hotel’s adjusted EBITDA on consolidated reporting was $0.3 million and RLH Corporation’s share of the adjusted EBITDA was approximately $0.2 million for Q1 2018. On an annual basis in 2017, the hotel’s adjusted EBITDA on consolidated reporting was $2.3 million and RLH Corporation’s share of the adjusted EBITDA was approximately $1.3 million This impact does not take into account the previously announced corporate overhead adjustments to reduce operating costs.
Hotel RL Spokane at the Park accounted for $2.8 million in revenue in Q1 2018 and $14.6 million in revenue on an annual basis in 2017. The hotel’s adjusted EBITDA on consolidated reporting was $0.9 million and RLH Corporation’s share of the adjusted EBITDA was approximately $0.5 million for Q1 2018. On an annual basis in 2017, the hotel’s adjusted EBITDA on consolidated reporting was $4.8 million and RLH Corporation’s share of the adjusted EBITDA was approximately $2.6 million. This impact does not take into account the previously announced corporate overhead adjustments to reduce operating costs.
