BETHESDA, Md.--(BUSINESS WIRE)--Feb. 6, 2014--
RLJ Lodging Trust (NYSE: RLJ) (“RLJ”) and Hyatt Hotels Corporation
(NYSE: H) (“Hyatt”) today announced that Hyatt affiliates have entered
into a definitive purchase and sale agreement for RLJ to acquire a
portfolio of 10 hotels totaling 1,560 rooms (the “Hyatt Portfolio”)
consisting of Hyatt, Hyatt Place and
Hyatt House
hotels. A Hyatt
affiliate will continue to manage the hotels under new management
agreements.
The Hyatt Portfolio, which is located primarily on the West Coast, is
expected to be acquired for a total purchase price of approximately $313
million. RLJ intends to spend approximately $25 million in capital
expenditures across the Hyatt Portfolio, the majority of which will be
invested over the next 24 months.
“We are excited about expanding our strategic relationship with Hyatt
and increasing our presence on the West Coast,” commented Thomas J.
Baltimore, Jr., President and Chief Executive Officer of RLJ Lodging
Trust. “Once completed, we will have acquired almost $900 million of
assets since our IPO. This deal will be immediately accretive to the
portfolio and will reinforce our stated goal of becoming the aggregator
in this segment.”
“This transaction demonstrates the value from asset recycling. We were
able to successfully convert hotels in key markets to Hyatt brands and
sell these hotels to a high quality owner while maintaining long term
presence in key markets,” said
Steve Haggerty
, Global Head, Real Estate
and Capital Strategy for Hyatt. “We are delighted to deepen our
relationship with the team at RLJ Lodging Trust and look forward to
future collaboration with them.”
Hyatt is a highly recognized, quality company with significant global
presence. The Hyatt Portfolio consists of young, high-performing, and
well-situated hotels. The hotels, the majority of which were acquired by
Hyatt in 2011, will immediately increase RLJ’s West Coast presence,
particularly in California where the company is currently seeking to
grow its presence. With the addition of this portfolio, RLJ will more
than double its hotel earnings before interest taxes depreciation and
amortization (EBITDA) on the West Coast. The remaining hotels are
located in dense premier markets with multiple demand generators.
RLJ continues to execute its stated strategy of becoming the leading
owner of premier select-service hotels. The Hyatt Portfolio will
represent more than 7% of RLJ’s projected 2013 Hotel EBITDA and more
than 7% of its total enterprise value. The Hyatt Portfolio is another
testament to RLJ’s disciplined approach of acquiring institutional grade
hotels in premier markets.
RLJ estimates that the Hyatt Portfolio’s 2013 aggregate RevPAR will be
greater than $120, which is more than a 10% premium to RLJ’s projected
RevPAR for 2013. Also, more than half of the hotels are expected to be
added to RLJ’s top 50 EBITDA contributors.
Details of the hotels are listed below:
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Property
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City
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State
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Rooms
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Hyatt House Cypress / Anaheim
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Cypress
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CA
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142
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Hyatt House Emeryville / SF Bay Area
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Emeryville
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CA
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234
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Hyatt Place Fremont / Silicon Valley
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Fremont
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CA
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151
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Hyatt House San Diego / Sorrento Mesa
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San Diego
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CA
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193
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Hyatt House San Jose / Silicon Valley
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San Jose
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CA
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164
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Hyatt House San Ramon
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San Ramon
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CA
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142
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Hyatt House Santa Clara
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Santa Clara
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CA
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150
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Hyatt Market Street, The Woodlands
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Woodlands
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TX
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70
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Hyatt House Charlotte / Center City
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Charlotte
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NC
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163
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Hyatt Place Madison / Downtown
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Madison
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WI
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151
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Total
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1,560
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The transaction is expected to be completed in March 2014 and is subject
to customary closing conditions. RLJ made a $10 million non-refundable
deposit upon execution of the purchase agreement.
RLJ expects to fund the acquisition of the Hyatt Portfolio through a
combination of various financial resources available for use, including
but not limited to cash on hand, its undrawn revolving credit facility,
and debt financing.
With the addition of the Hyatt Portfolio, RLJ is expected to own 160
properties, consisting of 158 hotels with approximately 24,000 rooms and
2 planned hotel conversions, located in 24 states and the District of
Columbia.
About RLJ Lodging Trust
RLJ Lodging Trust is a self-advised, publicly traded real estate
investment trust focused on acquiring premium-branded, focused-service
and compact full-service hotels. For more information, please visit www.rljlodgingtrust.com.
About Hyatt Hotels Corporation
Hyatt Hotels Corporation, headquartered in Chicago, is a leading global
hospitality company with a proud heritage of making guests feel more
than welcome. Thousands of members of the Hyatt family strive to make a
difference in the lives of the guests they encounter every day by
providing authentic hospitality. The Company's subsidiaries manage,
franchise, own and develop hotels and resorts under the Hyatt®,
Park Hyatt®, Andaz®, Grand Hyatt®, Hyatt Regency®, Hyatt Place®, Hyatt
House®, Hyatt ZilaraTM, and Hyatt
ZivaTM brand names and have
locations on six continents. Hyatt Residential Group, Inc.,
a Hyatt Hotels Corporation subsidiary, develops, operates,
markets or licenses Hyatt ResidencesTM and Hyatt
Residence ClubTM. As of September 30,
2013, the Company's worldwide portfolio consisted of 535 properties in
47 countries. For more information, please visit www.hyatt.com.
Forward Looking Statements
Certain statements and assumptions in this press release contain or
are based upon “forward-looking” information and are being made pursuant
to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. When we use the words “will,” may,”
“anticipate,” “estimate,” “should,” “expect,” “believe,” “intend,” or
similar expressions, we intend to identify forward-looking statements.
Such statements are subject to numerous assumptions and
uncertainties, many of which are outside of RLJ Lodging Trust or Hyatt’s
control, which could cause actual results to differ materially from
those expressed in or implied by the content of this document. Forward
looking statements made in this press release are made only as of the
date of their initial publication and neither party undertakes an
obligation to publicly update any of these forward looking statements as
actual events unfold.

Photos/Multimedia Gallery Available: http://www.businesswire.com/multimedia/home/20140206006570/en/
Source: RLJ Lodging Trust and Hyatt Hotels Corporation
RLJ Lodging Trust Contact:
Leslie D.
Hale
Chief Financial Officer
301-280-7774
or
Hyatt
Media Contact:
Farley Kern
Vice President, Corporate
Communications
312-780-5506
farley.kern@hyatt.com
or
Hyatt
Investor Contact:
Atish Shah
Senior Vice President,
Investor Relations
312-780-5427
atish.shah@hyatt.com