In providing an update on the impact of the coronavirus pandemic, Xenia Hotels & Resorts Inc. said it expects to suspend its dividend payments for the rest of 2020 but will pay its first-quarter dividend April 15 to shareholders of record as of March 31.
Xenia also drew the remaining $340 million from its $500 million senior unsecured revolving credit facility to help meet its ongoing operational and financial obligations.
Addressing its pending transactions, the hotel real estate investment trust said the $483 million deal it reached March 4 to sell a seven-hotel portfolio remains unchanged, with the buyer's $20 million nonrefundable deposit at risk should the deal not go ahead.
However, the REIT cannot say if the $100.5 million transaction that it entered to sell the Renaissance-Austin hotel in Austin, Texas, will close as agreed or not. The company had put the hotel on the market in November 2019 and reached an agreement to sell it Feb. 24, with closing anticipated in the first quarter. The parties then extended the closing until April 16 and agreed on releasing the $2 million escrow.
In addition, the $155 million sale of Xenia's 522-room Renaissance Atlanta Waverly Hotel & Convention Center in Atlanta, which is expected to close July 31, has about $7.8 million nonrefundable deposit at risk for the buyer in case the transaction does not proceed.
Xenia added that 24 of the its hotels and resorts temporarily suspended operations or are in the process of doing so, with the rest of its properties operating at reduced levels. It expects more properties to get affected in the future as well.
Xenia expects to reduce its corporate full-year expenses by over 20%, or approximately $5 million, mainly via lower executive incentive compensation. It is also canceling or deferring approximately 40%, or roughly $50 million of capital expenditures from its 2020 capital program.