RLJ Lodging Trust (the “Company”) (NYSE:RLJ) today announced that it has
closed on the previously announced acquisition of the 231-room Hilton
Cabana Miami Beach (the “Hotel”) for $71.6 million, or approximately
$310,000 per key. The purchase price represents a forward capitalization
rate of approximately 8.5% on the Hotel’s projected 2015 net operating
income.
“We are very excited to close on this new oceanfront hotel in the heart
of Miami Beach at a significant discount to replacement cost,” commented
Thomas J. Baltimore, Jr., President and Chief Executive Officer. “This
acquisition is another example of our ability to source and underwrite
attractive opportunities. We are excited to add this hotel to our
portfolio and expect it will further enhance our diversification and
growth profile.”
The Hotel is located along the 6200 block of Collins Avenue in Miami
Beach, which is in the famed "Millionaire's Row" submarket that is
proximate to a variety of restaurants, nightlife, entertainment, and
shopping. The Hotel is also located only minutes from South Beach, Bal
Harbour, and some of South Florida’s most sought after attractions. In
addition to guests enjoying the offerings located within the submarket,
they will also be able to enjoy the Hotel’s semi-private beach, vibrant
ocean views, and contemporary public spaces.
According to Smith Travel Research (“STR”), Hilton affiliated hotels
represent approximately 1% of the total rooms in the Miami Beach market.
The Company expects that the Hotel’s association with a premium brand,
such as Hilton, will yield strong demand from brand loyal guests seeking
accommodations in the area.
Miami's climate, numerous events, and unique amenities make it one of
the most active tourist destinations in North America. Additionally,
Miami’s excellent business climate, with its skilled multilingual and
multicultural workforce has attracted numerous international firms and
Fortune 500 companies.
As of 2013, the Miami market garnered one of the highest average daily
rates and one of the highest revenue per available room among the Top 25
markets as defined by STR, surpassed only by New York, Oahu Island and
San Francisco. In the coming years, the Hotel is expected to benefit
from Miami’s steadily increasing transient demand, robust convention
activity, and strong ties to Latin America.
Upon entering into the purchase and sale agreement, the Company made a
$7.2 million deposit. The remaining balance was funded with cash on the
balance sheet.
With the addition of this hotel, RLJ now owns 148 properties, comprised
of 146 hotels with approximately 23,000 rooms and two planned hotel
conversions, located in 21 states and the District of Columbia.
About Us
RLJ Lodging Trust is a self-advised, publicly traded real estate
investment trust focused on acquiring premium-branded, focused-service
and compact full-service hotels.
Forward Looking Statements
The following information contains certain statements, other than purely
historical information, including estimates, projections, statements
relating to the Company’s business plans, objectives and expected
operating results, and the assumptions upon which those statements are
based, that are “forward-looking statements” within the meaning of the
Private Securities Litigation Reform Act of 1995, Section 27A of the
Securities Act of 1933, as amended and Section 21E of the Securities
Exchange Act of 1934, as amended. These forward-looking statements
generally are identified by the use of the words “believe,” “project,”
“expect,” “anticipate,” “estimate,” “plan,” “may,” “will,” “will
continue,” “intend,” “should,” “may” or similar expressions. Although
the Company believes that the expectations reflected in such
forward-looking statements are based upon reasonable assumptions,
beliefs and expectations, such forward-looking statements are not
predictions of future events or guarantees of future performance and the
Company’s actual results could differ materially from those set forth in
the forward-looking statements. Some factors that might cause such a
difference include the following: the current global economic
uncertainty, increased direct competition, changes in government
regulations or accounting rules, changes in local, national and global
real estate conditions, declines in the lodging industry, seasonality of
the lodging industry, risks related to natural disasters, such as
earthquakes and hurricanes, hostilities, including future terrorist
attacks or fear of hostilities that affect travel, the Company’s ability
to obtain lines of credit or permanent financing on satisfactory terms,
changes in interest rates, access to capital through offerings of the
Company’s common and preferred shares of beneficial interest, or debt,
the Company’s ability to identify suitable acquisitions, the Company’s
ability to close on identified acquisitions and integrate those
businesses and inaccuracies of the Company’s accounting estimates. Given
these uncertainties, undue reliance should not be placed on such
statements. Except as required by law, the Company undertakes no
obligation to update or revise publicly any forward-looking statements,
whether as a result of new information, future events or otherwise. The
Company cautions investors not to place undue reliance on these
forward-looking statements and urge investors to carefully review the
disclosures the Company makes concerning risks and uncertainties in the
sections entitled “Risk Factors,” “Forward-Looking Statements,” and
“Management’s Discussion and Analysis of Financial Condition and Results
of Operations” in the Company’s Annual Report, as well as risks,
uncertainties and other factors discussed in other documents filed by
the Company with the SEC.
For additional information or to receive press releases via email,
please visit our website: http://rljlodgingtrust.com.
Copyright Business Wire 2014