Lodging REIT Incurs Loan Impairment Charges

Ashford Hospitality Trust booked a non-cash impairment charge of $19.8 million in the third quarter, setting aside loan reserves on two luxury hotel projects. The Dallas-based real estate investment trust elected to reserve for the remaining $9.1 million of its $18.2 million first mortgage participation in the Four Seasons Nevis due to additional uninsured costs incurred by the borrower and the delayed reopening of the resort until 2010. In addition, Ashford signed an agreement with the borrower on the Ritz Carlton Key Biscayne to allow for a discounted payoff of Ashford's $33.6 million loan that was set to mature in 2017. If closing occurs, Ashford will receive $20 million in cash and a $4 million secured note that matures in 2017. The company will reserve $10.7 million on this loan in anticipation of the discounted payoff.