Pebblebrook Continues Disposition Strategy With $42M Rouge Hotel Contract
Following the close of its $5.2 billion acquisition of LaSalle Hotel Properties, Pebblebrook has begun a disposition strategy.
WASHINGTON, DC—Pebblebrook Hotel Trust is under contract to sell the 137-room Rouge Hotel in the District for $42 million.
The sale price reflects a 17.4x EBITDA multiple and a 5% net operating income capitalization rate based on the hotel’s operating performance for 2018. Based on the trailing 12-month period ended March 2019, the sales price reflects a 17.7x EBITDA multiple and a 4.9% net operating income capitalization rate. The net operating income capitalization rates are after an assumed annual capital reserve of 4% of total hotel revenues.
The sale is expected to close in the third quarter.
Following the close of its $5.2 billion acquisition of LaSalle Hotel Properties, Pebblebrook has begun a disposition strategy in which it expects to sell between $750 million to $1.25 billion of hotels in the next six to 12 months. Indeed in its statement about the sale of the Rouge Hotel it noted that it continues to be encouraged with pricing levels and overall buyer interest in the investment markets.
Earlier this month Pebblebrook announced it had a contract to sell the Hotel Amarano Burbank for $72.9 million.
Also, in February it sold the 343-room, Liaison Capitol Hill in the District for $111.0 million.