WASHINGTON, DC—Pebblebrook Hotel Trust and RLJ Lodging, two REITs headquartered here, continue to invest in high-growth markets. Unfortunately, for the moment that does not include local submarkets.

Pebblebrook Hotel Trust just announced that it has acquired The Nines Hotel in Portland, OR, for $127 million. Earlier this month, RLJ Lodging Trust reported that it had snapped up the 194-room Hyatt Atlanta Midtown for $49.5 million.

These REITs are, of course, going where the high-growth markets are for this asset class, which in this cycle means the West Coast and select markets in the Southeast. Also in general, the hotel REIT cycle is particularly bullish right now, spurring companies to make acquisitions.

Pebblebrook's new 331-room luxury hotel is located across from Pioneer Square, in downtown Portland. It will keep its Starwood's Luxury Collection flag and continue to be operated by Sage Hospitality and Sage Restaurant Group. The REIT acquired a fee simple condominium interest in the historic building, which was originally constructed in 1909 as the Meier & Frank Building and subsequently underwent a $140 million adaptive reuse renovation in October 2008. Last year, The Nines Hotel operated at 88% company, with an average daily rate of $193 and room revenue per available room of $170. Pebblebrook forecasts that the hotel will generate EBITA of $12 to $12.6 million and NOI of $10.4 to $11 million. Pebblebrook is assuming three secured, non-recourse loans totaling $50.7 million with a weighted average interest rate of 7.4% as part of the transaction.

As for RLJ Lodging Trust, its acquisition of the 194-room Hyatt Atlanta Midtown clocked in at approximately $255,000 per key and a forward cap rate of approximately 8% on the hotel's projected 2015 net operating income.

Originally opened in 1987 as a Wyndham, the hotel was closed and underwent a $23 million renovation and conversion to a full-service Hyatt in July 2013. RLJ projects that during its first year of full ownership, the hotel's revenue per available room will be more than a 16% premium to the company's reported 2013 RevPAR.

Hotel REITs in general are positioned to do well in this cycle, various analysts have said. Cowen & Co., for example, which recently rated Pebblebrook as outperform, points to the sector's "low levels of new room supply growth combined with healthy demand growth." MLV & Co. analysts note that 2Q RevPAR is tracking materially above guidance and prior estimates, and predicts that RevPAR will continue to exceed current expectations.

For various reasons, starting with the government cutbacks of the last few years, hotels in DC have not been performing as well as their West Coast counterparts.

Pebblebrook first-quarter's performance was better than the REIT expected on all operating metrics—but no thanks to its hotels in DC, according to CFO Raymond Martz, who noted during the earnings call that RevPAR growth exceeded expectation largely due to the strong performance from its West Coast hotels. "This strength helped to offset weaker performance from our hotels in the DC area…"

LaSalle Hotel Properties, another local REIT, reported a RevPAR decline of 10.1% for its Washington DC properties in that same quarter, which was comprised of a 7.6% decrease in occupancy and a 2.7% decrease in ADR. Excluding Washington DC, its first quarter portfolio RevPAR increased 7.7%.

Many REITs made the same observation about the DC market: the presidential inauguration in 2013 made for a very tough comparison in the first quarter of 2014, although as Host Hotels and Resorts CEO Edward Walter noted, the inauguration "was not as beneficial in 2013 as we would have hoped. So it still was a challenge for the market for this year, but perhaps not as big as in a historical context." The Bethesda-based REIT reported flat RevPAR for the city for Q1.

None of this is to say that DC hotel assets are completely shunned by the investor community. Recent examples include the $69 million trade of Twelve & K Hotel; the $42.3 million sale of the Hilton Garden Inn at 1225 1st St NE and the rumored trade of the Park Hyatt Washington for $100 million.

And of course, there is the new convention center hotel, The Marriott Marquis Washington, which has opened its doors and is rapidly booking space.