A $2B Cash Bid Prices 21,110 Hotel Keys

CRE360 Signal™ | Daily Intelligence | Oct. 14, 2026

The Signal

TKO LLC proposed buying Service Properties Trust's hotel portfolio for $2.0B in cash. SVC said on Oct. 9 that it had no prior contact with TKO and that its board would review the unsolicited proposal. The announcement did not accept the offer.

SVC reported 93 hotels and 21,110 keys as of June 30, 2026, spanning full-service, select-service and extended-stay assets in the U.S., Puerto Rico and Canada. Dividing the proposed $2.0B purchase price by that disclosed room count gives about $94,700 per key. This is our calculation using the reported portfolio, not a closed-sale comparable or confirmation of the final asset schedule.

TKO's Oct. 7 letter provides important terms. The purchase would be all cash with no financing contingency, subject to agreed prorations and closing adjustments. TKO would not assume SVC's debt. The seller would retain secured and unsecured indebtedness and bear the costs of terminating management and franchise agreements the buyer does not assume.

The letter also sets conditions: due diligence, acceptable title, termination of specified operating agreements, third-party consents, permits and regulatory approvals. The acquisition terms are nonbinding pending a definitive agreement. The proposal remains open until 5 p.m. Eastern on Oct. 16 unless earlier withdrawn or extended in writing. That deadline is an offer term, not an announced board decision.

Implications / Our Read

The economic question is how much value and usable liquidity SVC would retain after the transaction. The $2B headline is gross consideration before adjustments and seller obligations. Retained debt and termination costs therefore belong in the underwriting alongside the purchase price.

The bid also covers a mixed hotel portfolio. Without a verified NOI figure for the same assets, the per-key calculation does not establish a cap rate or show whether the offer is attractive relative to comparable transactions.

The portfolio has changed substantially. Bisnow reported 206 hotels in March 2025; SVC reported 93 as of June 30, 2026. Those snapshots differ by 113 hotels, but the comparison alone does not establish that 113 properties were sold. We are not applying historical revenue from a differently defined hotel group to this bid.

A hotel sale would leave SVC's net-lease assets outside the transaction, consistent with the focus TKO describes. The proposed price, seller obligations and execution terms must be evaluated together before calling the offer a completed balance-sheet reset.

Stakeholder lens: Hotel owners and lenders can treat roughly $94,700 per key as an opening reference, then adjust for asset mix, market, operating performance and capital needs. Buyers should distinguish the absence of a financing contingency from the substantial diligence and closing work still required.