Moody National REIT II Seeks Shareholder OK for Liquidation, Dissolution of Company

Stockholders of Moody National REIT II, a publicly registered non-traded real estate investment trust focused on hospitality investments, will meet on Sept. 30 to vote on the complete liquidation and dissolution of the company. With the liquidation, the company seeks to sell its remaining assets, pay its debts, and distribute proceeds to shareholders.

Formed in July 2014 to invest in a portfolio of select-service hospitality properties with popular brands including Marriott, Hilton and Hyatt, the company had long cited COVID-19 as having an “adverse effect on the company’s financial condition and operating results.” In response to the pandemic, the REIT terminated its public offering of common stock in March 2020 and never resumed raising capital. It also indefinitely suspended the payment of distributions to stockholders and the operation of its share repurchase program.

On April 25, 2025, the REIT’s board of directors approved the plan to liquidate. Stockholders were previously told that the company might fail to meet maturing debt obligations in the near term if steps toward liquidation were not approved and implemented. The REIT reported five loans with maturities this year, altogether comprising 50% of its unpaid principal balance.

The company had linked its debt maturities as a cause for “going concern” in previous reporting with the U.S. Securities and Exchange Commission. As background:

• On Dec. 10, 2024, the REIT sold the Townplace Suites Fort Worth property to an unaffiliated purchaser for $9.1 million;
• On Feb. 6, 2025, the company sold the Residence Inn Grapevine property to an unaffiliated purchaser for $22.5 million;
• Also on Feb. 6, the company sold the Residence Inn Austin property to an unaffiliated purchaser for $20.5 million; and
• On March 21, the REIT sold the Marriott Courtyard Lyndhurst property to an unaffiliated purchaser for $21.3 million.

As of March 31, the REIT reported $254 million in total assets, including the ownership of 11 hotels. On April 11, it subsequently sold the Embassy Suites Nashville property to an unaffiliated purchaser for $57.5 million.

The lender for the Hilton Garden Inn Austin foreclosed on the property in satisfaction of the mortgage note in the principal amount of $16.2 million on May 2. With that exception and as of May 15, the REIT’s management noted that no other lenders had accelerated any debt maturity on other portfolio assets nor initiated foreclosure procedures with respect to any of the company’s properties.

As the REIT stated following the board’s decision to liquidate, it cannot complete the sale of its remaining assets and its dissolution pursuant to the terms of the plan of liquidation unless stockholders approve of the plan in the fall.

If the plan for liquidation is not approved by stockholders, the board said it would continue to evaluate other strategic alternatives to pursue, including continuing to operate under the company’s current business plan or seeking approval of a plan of liquidation at a future date.

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