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Eagle Hospitality Trust calls for trading halt after reports on possible lease default

EAGLE Hospitality Trust on Thursday morning requested a trading halt, pending the release of an announcement.

Earlier in the month, media reports had said the trust’s sponsor, Urban Commons, could be in danger of defaulting on its lease agreements to run The Queen Mary, a historic former luxury cruise liner in California that has been converted into an upscale floating hotel as one of Eagle’s key assets.

The city of Long Beach had sent a letter to Urban Commons chief executive Taylor Woods, claiming that the company had failed in its lease obligations to make several repairs to the ship, according to a report by the Long Beach Post.

The Oct 1 letter also asked Urban Commons to respond within 30 days and provide a plan to address the deficiencies in the repairs, or the city may find the company in default. That gives Urban Commons just one more week to respond before the deadline.

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Stapled securities of Eagle Hospitality Trust ended at US$0.645 on Wednesday, down one US cent.