Attached files
| file | filename |
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| 8-K - FORM 8-K - Pebblebrook Hotel Trust | w83128e8vk.htm |
| EX-99.2 - EX-99.2 - Pebblebrook Hotel Trust | w83128exv99w2.htm |
Exhibit 99.1
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2 Bethesda Metro Center, Suite 1530, Bethesda, MD 20814 T: (240) 507-1300, F: (240) 396-5626 www.pebblebrookhotels.com |
News Release
Pebblebrook Hotel Trust Acquires the W Boston
Bethesda, MD, June 10, 2011 — Pebblebrook Hotel Trust (NYSE: PEB) (the
“Company”) today announced that it has acquired the W Boston hotel for $89.5 million. The
235-room, luxury, full-service hotel is located in the Theatre District of downtown Boston,
Massachusetts. The property will continue to be managed by Starwood Hotels and Resorts
(“Starwood”).
“We are thrilled with the acquisition of the W Boston and the opportunity to further expand
our growing portfolio into the dynamic Boston market,” said Jon Bortz, Chairman and Chief Executive
Officer of Pebblebrook Hotel Trust. “The hotel is ideally located at the convergence of Boston’s
Back Bay, Financial District and Theatre District and is in close proximity to a number of
high-quality demand generators that include Class A office space, some of Boston’s finest dining,
upscale destination retail, theatres, medical and educational institutions and numerous cultural
venues. As the hotel works towards stabilized operations after a strong inaugural 2010, we believe
increased RevPAR penetration will occur as the property continues to push occupancy and rate as it
benefits from improving fundamentals in the Boston market.”
The W Boston is located in downtown Boston where the Theatre District, Financial District and
the Back Bay District meet. The area has seen considerable revitalization and gentrification over
the past five years. The hotel is convenient to many of the city’s prime demand generators and
attractions, including Fenway Park, many of Boston’s first-rate museums, the New England Aquarium,
Boston Common, Boston Public Garden, Quincy Market and the historic Freedom Trail.
Recently constructed in 2009, the W Boston is a luxury hotel that features 235 guestrooms and
suites with signature W Beds and state-of-the-art technology and entertainment. The hotel offers
5,000-square feet of indoor meeting space across nine meeting rooms with fully integrated
audio/visual systems and Bliss Spa, an upscale spa that offers massages, body treatments/wraps,
manicures/pedicures, facials, waxing and a retail store. The property is also home to SWEAT
Fitness Center, an 1,100 square-foot fully-equipped fitness center, as well as a 142-space parking
garage with valet service, WIRED business center and 24-hour room service.
The W Boston is situated along Stuart Street in downtown Boston, Massachusetts and offers
panoramic views of the city and features two food and beverage outlets, with a third currently
being developed. Market by Jean-George is a full-service restaurant that serves classic dishes
featuring fresh, locally produced ingredients in a classic upscale setting. The
fashionably-designed W Lounge is located in the lobby of the hotel and serves a wide variety of
drinks in a fun setting. Targeted to open in July 2011, Descent Theme Bar will be an exclusive
underground lounge and nightclub that will combine a 1920’s speakeasy vibe with a sleek, twenty
first century lounge experience.
In 2010, during the early stage of ramp up from its late 2009 opening, the W Boston operated
at 75% occupancy, with an ADR of $243. During the next 12 months, the Company currently forecasts
that the hotel will generate earnings before interest, taxes, depreciation and amortization
(“EBITDA”) of $5.1 to $5.6 million and net operating income after capital reserves of $4.0 to $4.5
million.
“We’re pleased to again be partnering with Starwood at the W Boston. They have outstanding
knowledge of the Boston market and we look forward to future success together at this high-quality
hotel,” continued Mr. Bortz.
The Company expects to incur approximately $0.6 million of costs related to the acquisition of
the hotel that will be expensed as incurred.
The W Boston marks the fourteenth acquisition for the Company, comprising over $1.1 billion of
invested capital since completing its initial public offering in December 2009.
About Pebblebrook Hotel Trust
Pebblebrook Hotel Trust (NYSE: PEB) is a publicly traded real estate investment trust (“REIT”)
organized to opportunistically acquire and invest primarily in upper upscale, full-service hotels
located in large urban and resort markets with an emphasis on the major coastal cities. The
company owns 14 hotels, totaling 3,813 guest rooms, in eight states and the District of Columbia,
including 13 markets: Bethesda, Maryland; San Francisco, California; Buckhead, Georgia; Washington,
DC; Minneapolis, Minnesota; Stevenson, Washington; Santa Monica, California; Philadelphia,
Pennsylvania; San Diego, California; Seattle, Washington; West Hollywood, California; Miami,
Florida; and Boston, Massachusetts. For more information, please visit
www.pebblebrookhotels.com.
Click here to visit the W Boston website
About Starwood Hotels and Resorts
Starwood Hotels is one of the leading hotel and leisure companies in the world with 1,025
properties in nearly 100 countries and territories with 145,000 employees at its owned and managed
properties. Starwood Hotels is a fully integrated owner, operator and franchisor of hotels,
resorts and residences with the following internationally renowned brands: St. Regis®, The Luxury
Collection®, W®, Westin®, Le Méridien®, Sheraton®, Four Points® by Sheraton, and the recently
launched Aloft®, and Element SM. Starwood Hotels also owns Starwood Vacation Ownership, Inc., one
of the premier developers and operators of high-quality vacation interval ownership resorts. For
more information, please visit www.starwoodhotels.com.
This press release contains certain “forward-looking” statements relating to, among other
things, potential property acquisitions, hotel EBITDA, hotel net operating income after capital
reserves, acquisitions costs and projected demand. Forward-looking statements are generally
identifiable by use of forward-looking terminology such as “may,” “will,” “should,” “potential,”
“intend,” “expect,” “seek,” “anticipate,” “estimate,” “approximately,” “believe,” “could,”
“project,” “predict,” “forecast,” “continue,” “plan” or other similar words or expressions.
Forward-looking statements are based on certain assumptions and can include future expectations,
future plans and strategies, financial and operating projections or other forward-looking
information. Examples of forward-looking statements include the following: projections of
hotel-level EBITDA and net operating income after capital reserves; projections of acquisition
costs; descriptions of the Company’s plans or objectives for future operations, acquisitions or
services; forecasts of future economic performance and potential increases in average daily rate,
occupancy and room demand; and descriptions of assumptions underlying or relating to any of the
foregoing expectations regarding the timing of their occurrence. These forward-looking statements
are subject to various risks and uncertainties, many of which are beyond the Company’s control,
which could cause actual results to differ materially from such statements. These risks and
uncertainties include, but are not limited to, the state of the U.S. economy, supply and demand in
the hotel industry and other factors as are described in greater detail in the Company’s filings
with the Securities and Exchange Commission (“SEC”), including, without limitation, the Company’s
Annual Report on Form 10-K for the year ended December 31, 2010. Unless legally required, the
Company disclaims any obligation to update any forward-looking statements, whether as a result of
new information, future events or otherwise.
For further information about the Company’s business and financial results, please refer to
the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and
“Risk Factors”
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sections of the Company’s SEC filings, including, but not limited to, its Annual Report on Form
10-K and Quarterly Reports on Form 10-Q, copies of which may be obtained at the Investor Relations
section of the Company’s website at www.pebblebrookhotels.com and at www.sec.gov.
All information in this release is as of June 9, 2011. The Company undertakes no duty to
update the statements in this release to conform the statements to actual results or changes in the
Company’s expectations. The Company assumes no responsibility for the contents or
accuracy of the information on any of the non-Company websites mentioned herein, which are included
solely for ease of reference.
Contact:
Raymond D. Martz, Chief Financial Officer, Pebblebrook Hotel Trust — (240) 507-1330
For additional information or to receive press releases via email, please visit our website at
www.pebblebrookhotels.com
www.pebblebrookhotels.com
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Pebblebrook Hotel Trust
W Boston
Reconciliation of Hotel Net Income to Hotel EBITDA and Hotel Net Operating Income
12-Month Forecast
(Unaudited, in millions)
W Boston
Reconciliation of Hotel Net Income to Hotel EBITDA and Hotel Net Operating Income
12-Month Forecast
(Unaudited, in millions)
| Range | ||||||||||||
| Low | High | |||||||||||
Hotel net income |
$ | 2.5 | to | $ | 3.0 | |||||||
Adjustment: |
||||||||||||
Depreciation and amortization (1) |
2.6 | 2.6 | ||||||||||
Hotel EBITDA |
$ | 5.1 | $ | 5.6 | ||||||||
Adjustment: |
||||||||||||
Capital reserve |
(1.1 | ) | (1.1 | ) | ||||||||
Hotel Net Operating Income |
$ | 4.0 | $ | 4.5 | ||||||||
| (1) | Depreciation and amortization has been estimated based on a preliminary purchase price allocation. A change, if any, in the allocation will affect the amount of depreciation and amortization and the resulting change may be material. |
This press release includes certain non-GAAP financial measures as defined under
Securities and Exchange Commission (SEC) Rules. These measures are not in accordance with, or an
alternative to, measures prepared in accordance with U.S. generally accepted accounting principles,
or GAAP, and may be different from non-GAAP measures used by other companies. In addition, these
non-GAAP measures are not based on any comprehensive set of accounting rules or principles.
Non-GAAP measures have limitations in that they do not reflect all of the amounts associated with
the hotel’s results of operations determined in accordance with GAAP.
The Company has presented forecasted hotel EBITDA and forecasted hotel net operating income
after capital reserves, because it believes these measures provide investors and analysts with an
understanding of the hotel-level operating performance. These non-GAAP measures do not represent
amounts available for management’s discretionary use because of needed capital replacement or
expansion, debt service obligations or other commitments and uncertainties, nor are they indicative
of funds available to fund the Company’s cash needs, including its ability to make distributions.
The Company’s presentation of the hotel’s forecasted EBITDA and forecasted net operating
income after capital reserves should not be considered as an alternative to net income (computed
in accordance with GAAP) as an indicator of the hotel’s financial performance. The table above is a
reconciliation of the hotel’s forecasted EBITDA and net operating income after capital reserves
calculations to net income in accordance with GAAP.
Pebblebrook Hotel Trust
Historical Hotel Pro Forma Operating Data
(In thousands)
(Unaudited)
Historical Hotel Pro Forma Operating Data
(In thousands)
(Unaudited)
Historical Operating Data:
| First Quarter | Second Quarter | Third Quarter | Fourth Quarter | Full Year | ||||||||||||||||
| 2010 | 2010 | 2010 | 2010 | 2010 | ||||||||||||||||
Pro forma Occupancy |
69.1 | % | 79.7 | % | 80.1 | % | 71.0 | % | 75.0 | % | ||||||||||
Pro forma ADR |
$ | 170.75 | $ | 179.19 | $ | 181.34 | $ | 182.71 | $ | 178.70 | ||||||||||
Pro forma RevPAR |
$ | 116.56 | $ | 141.58 | $ | 144.04 | $ | 128.23 | $ | 132.67 | ||||||||||
Pro forma Hotel Revenues |
$ | 66,255 | $ | 78,577 | $ | 78,560 | $ | 75,372 | $ | 298,764 | ||||||||||
Pro forma Hotel EBITDA |
$ | 10,599 | $ | 19,232 | $ | 18,097 | $ | 14,454 | $ | 62,382 | ||||||||||
| First Quarter | ||||||||||||||||||||
| 2011 | ||||||||||||||||||||
Pro forma Occupancy |
69.1 | % | ||||||||||||||||||
Pro forma ADR |
$ | 186.62 | ||||||||||||||||||
Pro forma RevPAR |
$ | 127.56 | ||||||||||||||||||
Pro forma Hotel Revenues |
$ | 72,182 | ||||||||||||||||||
Pro forma Hotel EBITDA |
$ | 12,326 | ||||||||||||||||||
These historical hotel operating results include results from the hotels the Company owned as
of June 9, 2011 including: DoubleTree by Hilton Bethesda-Washington DC, Sir Francis Drake,
InterContinental Buckhead, Hotel Monaco Washington DC, Skamania Lodge, Sheraton Delfina, Sofitel
Philadelphia, Argonaut Hotel, The Westin Gaslamp Quarter, Hotel Monaco Seattle, Mondrian Los
Angeles, Viceroy Miami and W Boston. This schedule excludes The Grand Hotel Minneapolis. These
historical operating results include results for periods prior to the Company’s ownership of the
hotels. The Company expects to include historical operating results for The Grand Hotel
Minneapolis after the Company has owned the hotel for one year.
The data above is not audited, has been presented only for comparison purposes and is subject to change.