Target Hospitality Corp. (“Target Hospitality” or the “Company”) (NASDAQ: TH), the largest provider of vertically-integrated specialty rental accommodations with premium catering and value-added hospitality services in the U.S., announced a planned expansion of 100 rooms at its El Capitan community located in Orla, Texas within the Permian’s Delaware Basin. This is the second expansion for this community that is directly tied to continued customer demand in the Delaware Basin, a growing hub of production, development, and capital investment.
Target Hospitality expects the $4 million El Capitan expansion to be completed in the second quarter of 2020 and will increase the available room count to 400. As with the Company’s prior investments in new greenfield communities, this expansion marks another successful project that resulted in rapid growth and doubled capacity within the first year of operation. A multi-year, guaranteed contract with a major integrated energy customer underpins the expansion of this community.
“With this expansion, Target continues to execute on our strategy of growing our lodges at attractive return profiles, and are incredibly pleased that this second expansion will double the size of this community in less than a year,” said Brad Archer, President and Chief Executive Officer of Target Hospitality. “Continued investment in the Delaware Basin will further enhance our ability to support our clients’ growing operations as our lodges continue to experience strong demand by our top tier customers for our premier full-turnkey hospitality services in this fast-growing region of the Permian Basin,” concluded Mr. Archer.
This expansion follows the Company’s recent announcement of contract renewals and extensions with four key customers. The expansion is reflective of the resiliency of the Permian Basin activity by major oil and gas producers and service providers.
Target Hospitality’s El Capitan community located in Orla, Texas is a full-turnkey community featuring single-occupancy accommodations complete with private bathrooms, a state-of-the-art commercial kitchen with dining facility, on-premises laundry, and indoor and outdoor recreational areas. Guests also benefit from amenities such as 24-hour culinary services, housekeeping, security, and a safety code of conduct program that includes a “zero tolerance” drug and alcohol policy.
To see a complete list of Target Hospitality’s communities, visit www.targethospitality.com.
