BETHESDA, MD-RLJ Lodging Trust is acquiring a 10-asset hotel portfolio from Hyatt Hotels Corp. for $313 million. The portfolio, which consists of some 1,560 keys, includes the Hyatt, Hyatt Place and Hyatt House. They are located primarily in California, except for three properties in Texas, North Carolina and Wisconsin.
A Hyatt affiliate will continue to manage the hotels under new management agreements when the transaction is completed, sometime in March 2014. RLJ plans to invest approximately $25 million in the portfolio over the next 24 months.
RLJ expects the acquisition will more than double its hotel earnings before EBITDA on the West Coast and will represent more than 7% of RLJ's projected 2013 Hotel EBITDA and more than 7% of its total enterprise value. "This deal will be immediately accretive to the portfolio and will reinforce our stated goal of becoming the aggregator in this segment," says Thomas J. Baltimore, Jr., president and CEO of RLJ Lodging Trust, in a prepared statement.
RLJ estimates that the portfolio's 2013 aggregate RevPAR will be greater than $120, or more than a 10% premium to RLJ's projected RevPAR for 2013.
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