Attached files
file | filename |
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8-K - FORM 8-K - Pebblebrook Hotel Trust | w79774e8vk.htm |
EX-10.1 - EX-10.1 - Pebblebrook Hotel Trust | w79774exv10w1.htm |
EX-10.2 - EX-10.2 - Pebblebrook Hotel Trust | w79774exv10w2.htm |
EX-10.4 - EX-10.4 - Pebblebrook Hotel Trust | w79774exv10w4.htm |
EX-10.5 - EX-10.5 - Pebblebrook Hotel Trust | w79774exv10w5.htm |
EX-10.3 - EX-10.3 - Pebblebrook Hotel Trust | w79774exv10w3.htm |
EX-99.2 - EX-99.2 - Pebblebrook Hotel Trust | w79774exv99w2.htm |
Exhibit 99.1
2 Bethesda Metro Center, Suite 1530, Bethesda, MD 20814 T: (240) 507-1300, F: (240) 396-5626 www.pebblebrookhotels.com |
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News Release
Pebblebrook Hotel Trust Acquires Monaco Washington DC
Bethesda, MD, September 9, 2010 Pebblebrook Hotel Trust (NYSE: PEB) (the
Company) today announced that it has acquired the Monaco Washington DC hotel for $74.0 million.
The 183-room, AAA Four Diamond, luxury, full-service hotel is located in downtown Washington, DC in
the heart of the Penn Quarter district. The hotel will continue to be managed by Kimpton Hotels
and Restaurants (Kimpton). The transaction includes the assumption of a $35.0 million secured
loan, with the remaining $39.0 million funded with proceeds from the Companys initial public
offering.
We are extremely excited to acquire such a unique and historically important property in the
heart of Washington, DC, said Jon Bortz, Chairman, President and Chief Executive Officer of
Pebblebrook Hotel Trust. The hotel is in an irreplaceable location within the Penn Quarter
neighborhood, which is within the East End of downtown Washington, DC, and is one of the most
vibrant and dynamic areas of the city. The hotel is surrounded by an abundance of entertainment
options, including museums, theaters, restaurants, bars and contemporary art galleries, as well as
the Verizon Center, which all provide the hotel with an irreplaceable location. Furthermore, the
Washington, DC hotel market continues to be one of the strongest markets in the nation, due to
government-related travel, tourism, and associations that generate year-round demand, healthy
convention activity and a dynamic office market.
Monaco Washington DC is located in downtown Washington, DC in the Penn Quarter, an area that
is considered to be the commercial and leisure heart of the city. A vibrant, always-on
neighborhood, Penn Quarter has been referred to by many as the Times Square of Washington, DC due
to its theatre district and its quantity of first-rate museums.
The Verizon Center Sports and Entertainment Arena is located directly across the street from
the hotel. The arena, which has a capacity of over 20,000, hosts more than 220 sporting, concert
and other events each year and is home to the Washington Capitals, Washington Wizards, Washington
Mystics and Georgetown Universitys mens basketball team. The hotel is also conveniently located
across the street from the Gallery Place Metro Station and the Smithsonian National Portrait
Gallery Museum, adjacent to the Spy Museum and a short walk to the Walter E. Washington Convention
Center and the National Mall.
Monaco Washington DC initially opened in 2002; however, original construction of the building
occurred in 1839 as the original United States Post Office. The building is one of the oldest
buildings in Washington, DC. Separated by a courtyard, one half of the building was designed by
Robert Mills, who also designed the Washington Monument, while the other half of the building was
designed by Thomas Walter, one of the contributing architects to the design of the U.S. Capitol.
The property is now a registered national historic landmark and an irreplaceable piece of history
that offers a truly unique lodging experience. The hotel provides over 7,000 square feet of
elegant meeting space and one of the
areas most popular restaurants, Poste Moderne Brasserie, which is also managed by Kimpton. The
hotel also offers a fitness center, 24-hour room service and a business center.
During 2009, the hotel achieved occupancy of 80 percent, with an average daily rate of $257.
During the next 12 months, the Company currently forecasts that the hotel will generate earnings
before interest, taxes, depreciation and amortization (EBITDA) of approximately $5.3 to $5.8
million and net operating income after capital reserves of approximately $4.5 to $5.0 million, both
of which are below the levels at which the hotel operated during 2007 and 2008.
The Company will own a leasehold interest in the property through a ground lease with the
General Services Administration (GSA) by way of the United States of America. There are
currently 49 years remaining on the lease, which expires in 2059. The $35 million secured loan
that is being assumed in connection with the acquisition is a non-recourse, interest-only loan,
subject to a rate of 5.68%, with a maturity of March 2012.
The hotel will continue to be managed by Kimpton, which has managed the property since 2002.
In addition to the Monaco Washington DC, Kimpton also manages the Sir Francis Drake and Scalas
Bistro in San Francisco, California for the Company.
Kimpton has a significant presence in the Washington, DC market and a strong track record and
extensive knowledge in operating historically rich and distinctive properties such as Monaco
Washington DC. We are eager to continue to grow our relationship with them, said Mr. Bortz.
We are thrilled we can continue to develop our relationship with Pebblebrook Hotel Trust,
commented Michael Depatie, CEO of the Kimpton Hotel & Restaurants. We have a tremendous history of
managing hotels in Washington, DC and look forward to working with Pebblebrook on the Monaco
Washington DC and future projects.
The Company expects to incur approximately $1.3 million of costs related to the acquisition of
this hotel that will be expensed in the third quarter.
Monaco Washington DC marks the fourth acquisition for the Company since completing its initial
public offering in December of 2009.
The Company has previously announced a signed agreement to purchase one other hotel:
- The Grand Hotel Minneapolis for $36.0 million
Closing for The Grand Hotel Minneapolis, as previously disclosed, is subject to the
satisfactory completion of ongoing due diligence and the satisfaction of customary closing
requirements and conditions. As with any potential acquisition, the Company can give no assurance
that it will elect to move forward with the purchase of the hotel or that if it does elect to move
forward, that the acquisition will close under the specific terms initially disclosed.
About Pebblebrook Hotel Trust
Pebblebrook Hotel Trust is a 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 four
hotels, with a total of over 1,250 guest rooms.
Click here to visit the Pebblebrook Hotel Trust website
About Kimpton
San Francisco-based Kimpton Hotels & Restaurants, a collection of boutique hotels and
chef-driven restaurants in the US, is an acknowledged industry pioneer and was the first to bring
the boutique hotel concept to America. Founded in 1981 by Bill Kimpton, the company is well-known
for making travelers feel welcomed and comfortable while away from home through intuitive and
unscripted customer care, stylish ambience and having a certain playfulness in its approach to
programs and amenities. Each hotel provides a range of exciting culinary experiences through
locally loved, top-rated, destination, chef-driven
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restaurants. Kimpton leads the hospitality
industry in ecological practices through its innovative EarthCare program that spans all hotels and
restaurants. Market Metrix, a recognized authority and leader in feedback solutions, consistently
ranks Kimpton above other hotel companies in luxury and upper upscale segments for customer
satisfaction. Privately held Kimpton operates 50 hotels and 54 restaurants in 16 states.
Click here to visit the Kimpton Hotel & Restaurant website
This press release contains certain forward-looking statements relating to, among other
things, potential property acquisitions and projected earnings, expenses and 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, the Companys
expenses, share count or other financial items; descriptions of the Companys plans or objectives
for future operations, acquisitions or services; projected completions of acquisitions; forecasts
of the Companys future economic performance, 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 Companys 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 Companys filings
with the Securities and Exchange Commission (SEC), including, without limitation, the Companys
Prospectus filed pursuant to Rule 424(b)(1) filed on July 23, 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 Companys business and financial results, please refer to
the Managements Discussion and Analysis of Financial Condition and Results of Operations and
Risk Factors sections of the Companys 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 Companys website at www.pebblebrookhotels.com and www.sec.gov .
All information in this release is as of September 9, 2010. The Company undertakes no duty to
update the statements in this release to conform the statements to actual results or changes in the
Companys 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.
Additional Contacts:
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
Hotel Monaco Washington DC
Reconciliation of Hotel Net Income to Hotel EBITDA and Hotel Net Operating Income
12-Month Forecast
(Unaudited, in millions)
Hotel Monaco Washington DC
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 |
$ | 3.1 | to | $ | 3.6 | |||||
Adjustment: |
||||||||||
Depreciation and amortization (1) |
2.2 | 2.2 | ||||||||
Hotel EBITDA |
$ | 5.3 | to | $ | 5.8 | |||||
Adjustment: |
||||||||||
Capital reserve |
(0.8 | ) | (0.8 | ) | ||||||
Hotel net operating income |
$ | 4.5 | to | $ | 5.0 | |||||
(1) | Depreciation and amortization has been estimated based on a preliminary purchase price allocation. The Company is currently evaluating the final purchase price allocation, which is based on many factors including the particular ground-lease-based ownership structure. A change, if any, in the allocation will affect the amount of Depreciation and Amortization and the amount 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 hotels results of operations determined in accordance with GAAP.
The Company has presented forecasted hotel earnings before interest, taxes, depreciation and
amortization (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
managements discretionary use because of needed capital replacement or expansion, debt service
obligations or other commitments and uncertainties, nor is it indicative of funds available to
fund the Companys cash needs, including its ability to make distributions.
The Companys presentation of the hotels 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 hotels financial performance. The
table above is a reconciliation of the hotels forecasted EBITDA and net operating income net
operating income after capital reserves calculations to net income in accordance with GAAP.