Lodgian gets $370 million credit facility

By Sara Rosenberg

New York, June 30 - Lodgian Inc. closed on a $370 million credit facility that was used to refinance $370 million of outstanding mortgage debt. Merrill Lynch Mortgage Lending Inc. provided the new debt.

The facility consists of a $110 million floating-rate tranche with an interest rate of Libor plus 340 basis points and a $260 million fixed-rate tranche with an interest rate of 6.58%, according to a company news release.

The floating-rate facility is secured by 29 hotels and has a two-year term plus three one-year extensions.

The fixed-rate facility is secured by 35 hotels and carries a term of five years.

"We have now restructured our balance sheet and attained a debt-to-total-capital ratio more in line with our peer hotel companies," said W. Thomas Parrington, president and chief executive officer, in the release. "The redemption of our preferred stock, which carries an annual coupon of 12.25%, substantially reduces our fixed charges.

"We believe we now have a much stronger balance sheet and are well positioned to respond to the opportunities ahead of us as the hotel industry recovers from a three-year downturn."

Lodgian is an Atlanta owner and operator of full-service hotels.

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