NEW YORK (Reuters) – Private equity firm Blackstone Group (BX.N) is aiming to control the restructuring of hotel owner Highland Hospitality Corp, a source familiar with the matter said on Tuesday, confirming a report in the Wall Street Journal.The buyout firm purchased a key slice of Highland’s debt from Wachovia Corp, the paper reported. This was confirmed by the source.
Highland, a real estate investment trust that owns 27 hotels, is struggling to restructure its $1.7 billion debt load amid the worst downturn for the hotel industry in decades, the Wall Street Journal said.
JER Partners, the private equity investment arm of J.E. Robert Companies, bought Highland for $2.1 billion, including the assumption of $210 million in debt in 2007, according to a JER press release that year.
At that time, Highland owned 28 luxury and limited-service hotels, including properties operated by Marriott International (MAR.N).
Highland could not be immediately reached for comment when contacted by Reuters after hours. Blackstone declined comment.
(Reporting by Megan Davies and Deepa Seetharaman; Editing by Phil Berlowitz)