CHICAGO--(BUSINESS WIRE)--
Hyatt Hotels Corporation (NYSE: H) today announced that Hyatt has
reached a definitive agreement with Host Hotels & Resorts (NYSE: HST)
for the sale of the 301-room Andaz Maui at Wailea Resort, the 668-room
Grand Hyatt San Francisco, and the 454-room Hyatt Regency Coconut Point
Resort and Spa for approximately $1.0 billion. The sale reflects a
blended EBITDA multiple of approximately 16x based on Hyatt’s 2018
pro-forma estimates. Hyatt will continue to manage the three hotels
under long-term management agreements. The transaction is expected to
close near the end of March 2018.
Mark S. Hoplamazian, president and chief executive officer of Hyatt
Hotels Corporation, said, “This agreement demonstrates the value of our
owned and leased hotels and strengthens our longstanding and valued
business relationship with Host. The completion of this transaction not
only allows Hyatt to maintain our brand presence in these key markets
with great brand representation, but also supports the execution of our
recently announced initiative to reduce real-estate ownership as part of
our broader capital strategy to unlock shareholder value.”
Two of the three hotels, Andaz Maui and Grand Hyatt San Francisco,
reflect a combined attributed sale value of approximately $800 million
and form part of Hyatt’s ongoing $1.5 billion permanent sell-down
program. On a blended basis, the sale of these two properties reflects
an EBITDA multiple of approximately 18x based on 2018 pro-forma
estimates. The sale of Hyatt Regency Coconut Point for an attributed
value of approximately $200 million, at an EBITDA multiple of
approximately 12x based on 2018 pro-forma estimates, completes Hyatt’s
2017 commitment to be a “net seller” of assets under its ongoing asset
recycling program.
Assuming closing in late March, Hyatt anticipates a net reduction in
consolidated Adjusted EBITDA of approximately $40 million for the three
properties combined over the remainder of 2018.
With the completion of this transaction, Hyatt is increasing its 2018
guidance for return of capital to shareholders to a minimum of $500
million from the previous guidance of at least $300 million. Hyatt
intends to provide a full update to the 2018 outlook including the
impact of these transactions and the new revenue recognition accounting
standard with its first-quarter earnings release in May.
The term “Hyatt” is used in this release for convenience to refer to
Hyatt Hotels Corporation and/or one more of its affiliates.
FORWARD-LOOKING STATEMENTS
Forward-Looking Statements in this press release, which are not
historical facts, are forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. These statements
include, but are not limited to, statements related to the Company’s
plans, objectives, goals, expectations, beliefs, business strategies,
future events, business conditions, business trends and expectations
with respect to, among other things, the time schedule to complete the
transaction, our guidance with respect to shareholder returns, and the
impact of the transaction on consolidated Adjusted EBITDA, and involve
known and unknown risks that are difficult to predict. As a result, our
actual results, performance or achievements may differ materially from
those expressed or implied by these forward-looking statements. In some
cases, you can identify forward-looking statements by the use of words
such as “may”, ”could”, ”expect”, “intend”, ”plan”, ”seek”,
”anticipate”, ”believe”, ”estimate”, ”predict”, ”potential”, ”continue”,
”likely”, ”will”, “would” and variations of these terms and similar
expressions, or the negative of these terms or similar expressions. Such
forward-looking statements are necessarily based upon estimates and
assumptions that, while considered reasonable by us and our management,
are inherently uncertain. Factors that may cause actual results to
differ materially from current expectations include, among others,
general economic uncertainty in key global markets and a worsening of
global economic conditions or low levels of economic growth; the rate
and the pace of economic recovery following economic downturns; levels
of spending in business and leisure segments as well as consumer
confidence; declines in occupancy and average daily rate; limited
visibility with respect to future bookings; loss of key personnel;
hostilities, or fear of hostilities, including future terrorist attacks,
that affect travel; travel-related accidents; natural or man-made
disasters such as earthquakes, tsunamis, tornadoes, hurricanes, floods,
wildfires, oil spills, nuclear incidents, and global outbreaks of
pandemics or contagious diseases or fear of such outbreaks; our ability
to successfully achieve certain levels of operating profits at hotels
that have performance guarantees in favor of our third-party owners; the
impact of hotel renovations and redevelopments; risks associated with
our capital allocation plans and common stock repurchase program and
other forms of shareholder capital return, including the risk that our
common stock repurchase program could increase volatility and fail to
enhance stockholder value; our intention to pay a quarterly cash
dividend and the amounts thereof, if any; the seasonal and cyclical
nature of the real estate and hospitality businesses; changes in
distribution arrangements, such as through internet travel
intermediaries; changes in the tastes and preferences of our customers;
relationships with colleagues and labor unions and changes in labor
laws; the financial condition of, and our relationships with,
third-party property owners, franchisees, and hospitality venture
partners; the possible inability of third-party owners, franchisees, or
development partners to access capital necessary to fund current
operations or implement our plans for growth; risks associated with
potential acquisitions and dispositions and the introduction of new
brand concepts; the timing of acquisitions and dispositions; failure to
successfully complete proposed transactions (including the failure to
satisfy closing conditions or obtain required approvals); our ability to
successfully execute on our strategy to reduce our real estate asset
base within targeted timeframes and at expected values; declines in the
value of our real estate assets; unforeseen terminations of our
management or franchise agreements; changes in federal, state, local, or
foreign tax law; the impact of changes in the tax code as a result of
recent U.S. federal income tax reform and uncertainty as to how some of
those changes may be applied; increases in interest rates and operating
costs; foreign exchange rate fluctuations or currency restructurings;
lack of acceptance of new brands or innovation; general volatility of
the capital markets and our ability to access such markets; changes in
the competitive environment in our industry, including as a result of
industry consolidation, and the markets where we operate; our ability to
successfully grow the World of Hyatt loyalty program and the level of
acceptance of the program by our guests; cyber incidents and information
technology failures; outcomes of legal or administrative proceedings;
violations of regulations or laws related to our franchising business;
and other risks discussed in the Company's filings with the SEC,
including our annual report on Form 10-K, which filings are available
from the SEC. We caution you not to place undue reliance on any
forward-looking statements, which are made only as of the date of this
press release. We do not undertake or assume any obligation to update
publicly any of these forward-looking statements to reflect actual
results, new information or future events, changes in assumptions or
changes in other factors affecting forward-looking statements, except to
the extent required by applicable law. If we update one or more
forward-looking statements, no inference should be drawn that we will
make additional updates with respect to those or other forward-looking
statements.
About Hyatt Hotels Corporation
Hyatt Hotels Corporation, headquartered in Chicago, is a leading global
hospitality company with a portfolio of 14 premier brands. As
of December 31, 2017, the Company's portfolio included more than 700
properties in more than 50 countries across six continents. The
Company's purpose to care for people so they can be their best informs
its business decisions and growth strategy and is intended to attract
and retain top colleagues, build relationships with guests and create
value for shareholders. The Company's subsidiaries develop, own,
operate, manage, franchise, license or provide services to hotels,
resorts, branded residences, vacation ownership properties, and fitness
and spa locations, including under the Park Hyatt®, Miraval®,
Grand Hyatt®, Hyatt Regency®, Hyatt®, Andaz®, Hyatt Centric®, The
Unbound Collection by Hyatt®, Hyatt Place®, Hyatt
House®, Hyatt Ziva™,
Hyatt Zilara™, Hyatt Residence Club® and
exhale® brand names. For more information, please visit www.hyatt.com.

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Source: Hyatt Hotels Corporation