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Park Hotels trims portfolio with $317M noncore asset sale

Park Hotels & Resorts Inc. closed separate sale transactions for 11 noncore assets in the U.S., U.K. and South Africa for gross proceeds of $317 million, reflecting a 5.7% capitalization rate on the portfolio's projected 2017 net income.

The assets sold include the 241-room Embassy Suites by Hilton Atlanta Perimeter Center in Atlanta; the 236-room Embassy Suites by Hilton San Rafael Marin County in San Rafael, Calif.; and the 199-room Embassy Suites by Hilton Kansas City Overland Park in Overland Park, Kan., which were sold for roughly $95.8 million.

The U.K. portfolio fetched approximately $189 million for the following properties: the 188-room Hilton London Islington in London, the 173-room Hilton Bath City in Bath, the 184-room Hilton Edinburgh Grosvenor in Edinburgh, the 198-room Hilton Belfast in Belfast, the 278-room Hilton Blackpool in Blackpool, the 138-room Hilton Milton Keynes in Milton Keynes, and the 175-room Hilton Coylumbridge in Coylumbridge.

In South Africa, Park Hotels sold the 327-room Hilton Durban Hotel, in Durban, for approximately $32.5 million.

The divestments significantly reduced the lodging real estate investment trust's exposure to international markets, Chairman and CEO Thomas Baltimore said in a release.

Separately, global private investment firm Starwood Capital Group disclosed that the U.K. portfolio was acquired by a controlled affiliate of Starwood Global Opportunity Fund XI and will be managed by Kew Green under franchise agreements with Hilton Worldwide Holdings Inc.