
Five Mile Capital Partners and Westmont Hospitality Group gained control of 143 properties from Red Roof Inns Inc. on Wednesday by acquiring US$700 million in mortgage debt.
Red Roof Inn Inc. will continue to manage the hotels via its affiliate RRI West Management through a franchise agreement. As part of the deal, US$70 million will be committed to revitalizing the properties.The deal will help recapitalize Red Roof Inns Inc. after the company defaulted on US$754 million in mortgage loans on 127 properties in 2009. Red Roof Inns Inc. also recently sold 51 properties to Dune Real Estate partners and Westmont.The economy-level Red Roof Inn hotels involved in the purchase, totaling 17,000 rooms, are located in the U.S. and represent nearly half of the Red Roof Inn portfolio that includes corporate-owned and franchised hotels.The deal will help recapitalize Red Roof Inns Inc. after the company defaulted on US$754 million in mortgage loans on 127 properties in 2009. Red Roof Inns Inc. also recently sold 51 properties to Dune Real Estate partners and Westmont.

