The COVID-19 pandemic has badly hurt the hospitality sector and is creating serious troubles for Eagle Hospitality REIT, as one of its master lessees has skipped rent and triggered the repayment acceleration of a syndicated loan, resulting in the trust receiving a notice of default:
On behalf of the lenders, Bank of America exercised its right to accelerate the entirety of the loan. This means that the principal amount of US$341 million was declared to have become immediately due and owing, the managers said.
As a result, the distribution to unit holders is being cancelled:
Stapled security holders will also not receive the distribution of 3.478 US cents per security on the previously announced payment date of March 30, 2020. The distribution is for the period from EHT's listing date of May 24, 2019 to Dec 31, 2019.
Units which IPOed less than a year ago at US$0.78 are sharply down as of this writing at US$0.137.