Service Properties Trust (Nasdaq: SVC) is a publicly traded real estate investment trust (REIT). SVC invests in two asset categories: hotels and
service-focused retail net lease properties, to provide diversification and stability to SVC’s cash flows.
Strong diverse portfolio of hotel assets:
- SVC’s hospitality portfolio consists of 202 hotels with 35,359 rooms or suites located in 35 states, the District of Columbia, Ontario, Canada
and San Juan, Puerto Rico.
- Typically located in urban or high-density suburban locations in the vicinity of major demand generators such as urban centers, airports,
medical or educational facilities, major tourist attractions or large suburban office parks.
- SVC’s hotels are primarily operated by Sonesta International, one of the fastest growing hotel brands in the U.S., as well as Hyatt and Radisson.
Defensively positioned service-focused retail net lease properties:
- SVC’s portfolio of 739 service-focused retail net lease properties totals over 13.1 million square feet and is well diversified by geography,
tenant and industry.
- Net lease is a naturally defensive asset class with long average lease terms and low capex requirements.
- Exposure to service-based concepts aligns with consumer preferences and provides insulation from ecommerce disruption.
External manager provides deep management expertise and significant cost benefits:
- SVC is externally managed by The RMR Group Inc. (Nasdaq: RMR), a leading U.S. alternative asset management company with approximately $40 billion
of real estate assets under management.
- RMR’s depth of management and experience in the real estate industry is a competitive advantage for SVC.
- RMR provides management services to SVC at lower costs than for similar quality services if the company was self-managed.
Strong balance sheet:
- Over $11 billion of diverse real estate assets.
- Well-laddered debt maturities for senior unsecured notes.
- SVC also owns approximately 34% of the shares of Sonesta Holdco Corporation.