EH-Reit receives US$153.9m in net proceeds from sale of five Chapter 11 assets

Vivienne Tay
Published Thu, Jun 17, 2021 · 12:30 PM

EAGLE Hospitality Real Estate Investment Trust (EH-Reit), which is part of Eagle Hospitality Trust (EHT), has received net proceeds of about US$153.9 million following the sale of five Chapter 11 properties.

The net proceeds have been partially used to repay the debtor-in-possession facility and the stalking horse "break up" fee, EH-Reit trustee DBS Trustee said in a bourse filing on Thursday.

The balance remaining is around US$109.7 million, which will go to repaying ongoing post-petition expenses and pre-petition creditors. This includes some US$380 million under a pre-petition facilities agreement, as well as claims from trade creditors against these entities which DBS Trustee said cannot be quantified at this time.

"To the extent any value remains, other junior creditors would be paid," it added.

The sale of four Chapter 11 properties for US$117.2 million was completed on June 3. These assets were Sheraton Denver Tech Center, Four Points by Sheraton San Jose Airport, Embassy Suites by Hilton Anaheim North, and Double Tree by Hilton Salt Lake City. Hilton Atlanta Northeast was later sold for US$37.9 million on June 8.

DBS Trustee expects the remaining Chapter 11 properties to be sold by the end of June. Hilton Houston Galleria Area and Delta Woodbridge remain under receivership.

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Urban Commons Queensway, a unit of EHT, on June 4 surrendered the Queen Mary Long Beach - a former ocean vessel-turned-floating hotel - to the City of Long Beach, California.

EHT is a stapled group comprising EH-Reit and Eagle Hospitality Business Trust. EHT filed for Chapter 11 bankruptcy in January 2021. Trading in EHT has been suspended since March 2020.

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