Summit Hotel unit gets $125 million revolver, $75 million term loan

By Wendy Van Sickle

Columbus, Ohio, Oct. 15 – Summit Hotel Properties, Inc.’s subsidiary, Summit JV MR 1, LLC, entered into a $200 million credit facility on Oct. 8 with Bank of America, NA as administrative agent, according to an 8-K filing with the Securities and Exchange Commission.

BofA Securities, Inc. is the lead arranger and bookrunner.

The facility comprises a $125 million revolver and a $75 million term loan.

There is an up to $300 million accordion feature, for total borrowings up to $500 million.

Each tranche will mature on Oct. 8, 2023 and can be for a single consecutive 12-month period.

Revolver borrowings will bear interest at Libor plus 215 basis points, and term loan borrowings will bear interest at Libor plus 210 bps.

There is an unused fee of 25 bps on the revolver.

Financial covenants include, among others, a maximum leverage ratio of 55%.

The facility also requires a minimum consolidated tangible net worth of not less than $100 million plus 75% of the net proceeds of subsequent equity issuances, a minimum consolidated fixed charge coverage ratio of not less than 1.5 to 1 and a ratio of secured debt to total asset value of not more than 40%.

Summit Hotel is an Austin, Tex.-based real estate investment trust.

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