Pebblebrook Hotel Trust Acquires The Redbury Hotel in Hollywood, CA

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Pebblebrook Hotel Trust
PEB
(the “Company”) today announced that it has acquired the award-winning Redbury Hotel for $34.0 million. The 57-room, all-suite, luxury, full-service hotel is located in the center of Hollywood, California. The property will continue to be managed by sbe Hotel Group (“sbe”). “We're thrilled with the acquisition of the Redbury in the dynamic, high-barrier-to-entry Hollywood neighborhood,” said Jon Bortz, Chairman, President and Chief Executive Officer of Pebblebrook Hotel Trust. “The hotel is ideally located at the corner of Hollywood Boulevard and Vine Street in the center of Hollywood and overlooks historic locations such as The Pantages Theater and the Capitol Records Tower. The property's location provides convenient access to all of the tourist attractions, restaurants, nightlife and entertainment industry activity that the Hollywood and West Hollywood areas have to offer. The Redbury complements our hotels in West Hollywood (Mondrian Hotel), Westwood (W Los Angeles - Westwood) and Santa Monica (Sheraton Delfina, soon to be rebranded Le Méridien Delfina). Los Angeles attracts over 25 million total visitors annually and is the second-most visited city by overseas visitors. The steady demand growth of the market, along with a historically constrained supply environment, provides excellent operating fundamentals for the market and the hotel.” Designed by Creative Director and renowned photographer Matthew Rolston, in collaboration with sbe Founder and CEO Sam Nazarian, The Redbury Hotel is situated at the iconic convergence of Hollywood and Vine, and is just steps away from the center of the Hollywood Walk of Fame. In addition to being just a block away from the Hollywood / Vine Metro Red Line, the hotel is well-located for access to the greater Los Angeles area's attractions, including the Hollywood Bowl, Beverly Hills, Century City, UCLA, the Getty Center, Downtown Los Angeles, Santa Monica and Los Angeles International Airport. The Redbury Hotel boasts 57 well-appointed, all-suite guest rooms that average 790 square feet, each with sophisticated design elements drawn from a variety of old-world cultures. Each spacious suite offers a home-like atmosphere with 40- or 46-inch high-definition LCD TVs with DVD and DVR, high-speed wi-fi, oversized walk-in rain showers, floor-to-ceiling windows, private patio or balcony and European-style kitchens with gas burners. The hotel's signature dining concept, Cleo, is a celebrated and award-winning Mediterranean restaurant and bar, and The Library is a private indoor-outdoor lounge on the second floor that offers hand-crafted specialty cocktails and select menu items from Cleo in a relaxed, intimate setting. In addition, the property contains 154 on-site parking spaces and provides valet parking. In 2012, The Redbury Hotel operated at 84% occupancy, with an average daily rate (“ADR”) of $274 and room revenue per available room (“RevPAR”) of $230. During the next 12 months, the Company currently forecasts that the hotel will generate earnings before interest, taxes, depreciation and amortization (“EBITDA”) of $2.75 to $3.0 million and net operating income after capital reserves (“NOI”) of $2.25 to $2.5 million. “We're thrilled to be building a strategic relationship with sbe,” continued Mr. Bortz. “sbe has a strong presence in the Los Angeles market and terrific expertise in operating boutique hotel properties with high-quality restaurants and bars.” “Partnering with Pebblebrook on the Redbury is a venture with tremendous upside and positions the property for continued success for years to come,” added Mr. Nazarian. “Our collective knowledge of the Los Angeles market and vast hotel industry expertise will add tremendous value to the property and provide a strong foundation for our partnership to thrive.” The Company expects to incur approximately $0.5 million of costs related to the acquisition of the hotel that will be expensed as incurred. The acquisition of The Redbury Hotel brings the total number of properties in the Company's portfolio to 27, comprising $2.1 billion of invested capital. This acquisition marks the Company's fourth investment in west Los Angeles, including the 236-room Mondrian Los Angeles in West Hollywood, the 310-room Sheraton Delfina Santa Monica (soon to be rebranded Le Méridien) in Santa Monica and the 258-room W Los Angeles – Westwood in Westwood. About Pebblebrook Hotel Trust Pebblebrook Hotel Trust is a publicly traded real estate investment trust (“REIT”) organized to opportunistically acquire and invest primarily in upper upscale, full-service hotels located in urban markets in major gateway cities. The Company owns 27 hotels, including 21 wholly owned hotels with a total of 5,017 guest rooms and a 49% joint venture interest in six hotels with a total of 1,733 guest rooms. The Company owns, or has an ownership interest in, hotels located in ten states and the District of Columbia, including 16 markets: Los Angeles, California; San Diego, California; San Francisco, California; Santa Monica, California; West Hollywood, California; Miami, Florida; Buckhead, Georgia; Bethesda, Maryland; Boston, Massachusetts; Minneapolis, Minnesota; New York, New York; Portland, Oregon; Philadelphia, Pennsylvania; Columbia River Gorge, Washington; Seattle, Washington; and Washington, DC. For more information, please visit us at www.pebblebrookhotels.com and on Twitter at @PebblebrookPEB.
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