The transaction is expected to be finalised in early January, subject to standard closing conditions. Credit: ImageFlow / Shutterstock.

Ashford Hospitality Trust has a definitive agreement with an undisclosed buyer to sell the Courtyard Boston Downtown for $123m ($390,500 per key).

The deal for the 315-room property is contingent on customary closing conditions and is anticipated to conclude by January 2025.

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There is no guarantee it will be finalised as proposed or at all.

The agreed sale price, when factoring in projected capital expenditures by the company, equates to a 5.9% capitalisation rate based on net operating income for the 12 months leading up to 30 September 2024.

This also corresponds to a multiple of 14.3 times the Hotel EBITDA for the same period. 

Without including the expected capital spend, the figures adjust to a 6.9% capitalisation rate and a multiple of 12.3 times the Hotel EBITDA.

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Ashford Trust’s president and CEO Stephen Zsigray said: “We are pleased to announce the signed agreement to sell the Courtyard Boston Downtown at a very attractive cap rate.

“This sale will not only deleverage our BAML Highland Pool loan but will also result in significant capital expenditure savings. We continue to have several assets in the market at various stages of the sales process and are encouraged by the improved sentiment we are seeing in the transaction market.”

Specialising as a real estate investment trust (REIT), Ashford Hospitality Trust primarily invests in upper upscale, full-service hotels.

Last month, Ashford Hospitality Trust completed the transformation of Le Pavillon Hotel in New Orleans, Louisiana, US, into a Tribute Portfolio property with a $19m investment.

The refurbished 226-room hotel now joins Marriott’s global family of independent Tribute Portfolio hotels, known for their design and social scenes.