Strategic Hotels & Resorts Inc. (BEE, Financial) filed Quarterly Report for the period ended 2009-09-30.
STRATEGIC HOTELS & RESORTS INC. is a real estate investment trust which owns and provides value-enhancing asset management of high-end hotels and resorts in the United States Mexico and Europe. The company currently has ownership interests in 19 properties with an aggregate of 8346 rooms Strategic Hotels & Resorts Inc. has a market cap of $126.3 million; its shares were traded at around $1.68 with a P/E ratio of 5.6 and P/S ratio of 0.1.
Amendment to Bank Credit Facility. In February 2009, we entered into the third amendment to our bank credit facility. This amendment, among other things, provides us with additional flexibility with respect to our financial covenants and related financial calculations, reduces the facility size from $500.0 million to $400.0 million and increases the interest rate from LIBOR plus a margin of 0.80% to 1.50% to LIBOR plus a margin of 3.75%. See Liquidity and Capital Resources for further detail regarding the third amendment to our bank credit facility.
Sale of the Four Seasons Mexico City Property. On October 29, 2009, we sold the Four Seasons Mexico City property for a gross price of $54.0 million and expect to record a gain of approximately $4.5 million in the fourth quarter.
Impairment Losses and Other Charges. During the three months ended September 30, 2009, we recorded a non-cash impairment charge of $30.8 million related to the long-lived assets of the Renaissance Paris hotel due to a change in the anticipated holding period of this hotel. During the three months ended September 30, 2008, we reviewed our goodwill and other intangible assets for potential impairment and recorded an estimated non-cash impairment charge that consisted of $57.2 million of goodwill and $0.6 million of other intangible assets. The charges related to the Fairmont Scottsdale ($50.7 million) and the Ritz-Carlton Laguna Niguel ($7.1 million). We also recorded a charge of approximately $35.2 million related to abandoning our planned purchase of an interest in a mixed-use building, the Aqua Building. The charge included the loss of our $28.0 million deposit in the form of a letter of credit that secured the contract and approximately $7.2 million in planning and development costs. Finally, we abandoned several capital projects at certain of our properties due to unfavorable market conditions. We recorded a charge of approximately $3.6 million to write off capitalized costs related to these projects.
Read the The complete ReportBEE is in the portfolios of Kenneth Fisher of Fisher Asset Management, LLC.
STRATEGIC HOTELS & RESORTS INC. is a real estate investment trust which owns and provides value-enhancing asset management of high-end hotels and resorts in the United States Mexico and Europe. The company currently has ownership interests in 19 properties with an aggregate of 8346 rooms Strategic Hotels & Resorts Inc. has a market cap of $126.3 million; its shares were traded at around $1.68 with a P/E ratio of 5.6 and P/S ratio of 0.1.
Highlight of Business Operations:
Lease expense. As a result of sale and leaseback transactions applicable to the Paris Marriott and Marriott Hamburg hotels, we recorded lease expense in our statements of operations. In conjunction with the sale and leaseback transactions, we also recorded a deferred gain. Net lease expense includes an offset for the amortization of the deferred gain of $1.2 million and $1.3 million for the three months ended September 30, 2009 and 2008, respectively, and $3.6 million and $4.0 million for the nine months ended September 30, 2009 and 2008, respectively.Amendment to Bank Credit Facility. In February 2009, we entered into the third amendment to our bank credit facility. This amendment, among other things, provides us with additional flexibility with respect to our financial covenants and related financial calculations, reduces the facility size from $500.0 million to $400.0 million and increases the interest rate from LIBOR plus a margin of 0.80% to 1.50% to LIBOR plus a margin of 3.75%. See Liquidity and Capital Resources for further detail regarding the third amendment to our bank credit facility.
Sale of the Four Seasons Mexico City Property. On October 29, 2009, we sold the Four Seasons Mexico City property for a gross price of $54.0 million and expect to record a gain of approximately $4.5 million in the fourth quarter.
Impairment Losses and Other Charges. During the three months ended September 30, 2009, we recorded a non-cash impairment charge of $30.8 million related to the long-lived assets of the Renaissance Paris hotel due to a change in the anticipated holding period of this hotel. During the three months ended September 30, 2008, we reviewed our goodwill and other intangible assets for potential impairment and recorded an estimated non-cash impairment charge that consisted of $57.2 million of goodwill and $0.6 million of other intangible assets. The charges related to the Fairmont Scottsdale ($50.7 million) and the Ritz-Carlton Laguna Niguel ($7.1 million). We also recorded a charge of approximately $35.2 million related to abandoning our planned purchase of an interest in a mixed-use building, the Aqua Building. The charge included the loss of our $28.0 million deposit in the form of a letter of credit that secured the contract and approximately $7.2 million in planning and development costs. Finally, we abandoned several capital projects at certain of our properties due to unfavorable market conditions. We recorded a charge of approximately $3.6 million to write off capitalized costs related to these projects.
Read the The complete ReportBEE is in the portfolios of Kenneth Fisher of Fisher Asset Management, LLC.
