Contacting IR would probably be your best bet, but from what I have heard they are pretty tight lipped.
For the rest of you guys, here is the reply from me you referred to, this is from a friend who first got me involved with EHPTP
A good read,
As you know I have been researching the resale value. The first thing you should know it the market for quality hotels is very strong, especially in high traveled areas. Pricing in areas like L.A., San Francisco and New York are trading at a plus to the values before the markets shake up.
Cheap hotels are also being sought but at discounts which are surprisingly low to market values. There was some slippage in values to be sure but most of it is not in value as it is in financing opportunities. There are some avenues for financing of new acquisition but they appear to be impaired for refi's to a great extent.
Here the Eagle owners are on the hook for close to the market value, and as Commercial loans have historically wanted a 30% equity position this is keeping the door closed. Time is Eagles only enemy right now.
The Hotel market is actually starting to really heat up across the world from my research and demand is starting to outpace supply very quickly. Narrow that field by only looking and the upper class, and make no mistake, in Brand, Buildings and Operating revenues, these are at the very top as this report says!
Well that makes these worth paying up for.
IMHO we are going to see Blackstone accept about $540 Million if it is done this year, and $550 if not until mid next year. I don't see them playing this hand beyond that...
The principal is also being paid down month over month.
The high end of commercial investing will go 7.5 times the total annual revenue. This is a high of $937 Million and arguably what Apollo and their buds used to buy this,
As this assessment you sent it is currently averaging 4.86 or $608 Million I have to disagree only a bit with that, I think the buyers in today's markets are getting antsy. They waited for 4 or more years on the side now for a major devaluation that never came and as of my most recent hotel / motel magazine reading it is fast slipping away with any discount at all. And these are premium hotels at the top of the heap! and at the top of the shoppers list from what I have read in the trade mags (Hotel / Motel and Commercial Real Estate Investing Mags) ....
I think we will see someone step in with a bid of about 5.75 times the current revenue with them assuming room occupancy can improve at least 15% with market recovery. (And it will!)
That puts the sale value at $720 Million. Now keep in mind that the company has said over and over again it was reserving capital for acquisition or financial cushion. If they have averaged a profit of $45 Million a year as reported and "I found recorded" a year ago in their own internal reports to Apollo FundV investors , how much would that be? Also they have reportedly invested "With $77MM spent over the past four years on capital expenditures," hotel improvements I suspect they are holding about $60 to $80 million in the books. Remember they could not distribute any money without paying us first.
I see a total value of cash and sale could easily be $800 Million before payouts.
So I think is may be a bit more like this;
With 4MM preferred shares outstanding, this is the valuation walk I get:
Hotel Sale Proceeds $720,000,000
Transaction Expenses (3% of Proceeds) -$21,600,000
Net Proceeds $698,400,000
Par Value of Debt $600,000,000 (This has been paid down some and missed by this assessment)
Discount 10%
Debt Repayment $540,000,000
Net Proceeds $158,400,000
2012 NOI YTD $33,750,000
Less: Interest Expense -$15,000,000
Less: Cap Ex -$5,000,000
Available Cash from 2012 Operations $13,750,000
Total Available for Preferred $172,150,000
Units Outstanding 4,000,000
Recovery per Unit ($43.03 Exceeds Need) $25.00 FULL RECOVERY PLUS INTEREST (Correct me if I am wrong $8.76 Interest)
I would expect a payout of $33.76, if we get anything less the common / Apollo group gets none!
Should this assessment you sent be more accurate, it does not reflect the reserve of $$$???. That alone would add another $20.00 to Preferred available funds. Lets say I am way off and they only held on to say $30 Million in reserve, first, where did the other $70 to $80 Million in earnings go over the last 4 years??
Second, even that would add another $7.50 to the $18.20 this report finds. ($25.70)
I think this settles more like $25.70 to Full recovery of $33.76!
