Dallas-based real estate investment trust Ashford Hospitality Trust plans to hand back the keys for 19 hotels after failing to meet debt yield tests on maturing loans.
All of the hotels sat in three pools of commercial mortgage-backed securities loans that matured in June, and company officials believe the required $255 million in paydowns to extend loan terms would represent “negative equity value,” according to a statement the company released late Friday. Ashford Trust had marketed several of the hotels they now plan to hand back to lenders but did not accept any bids above the amount owed on the properties.
“The company has been in discussions with the lenders on these loan pools seeking modifications to the extension tests, but at this time, it appears that the most likely outcome will be a consensual transfer of these hotels to the respective lenders,” the news release states.
Ashford Trust officials