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Pebblebrook Hotel Trust Comments on Institutional Shareholder Services' Recommendation against LaSalle Hotel Properties' Proposed Transaction with Blackstone

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ISS Recommends Voting AGAINST the LaSalle-Blackstone Transaction
Using the GOLD Proxy Card

Pebblebrook Hotel Trust (NYSE:PEB) ("Pebblebrook") today commented on
the recommendation from proxy advisory firm Institutional Shareholder
Services ("ISS") to vote against the proposed transaction between
LaSalle Hotel Properties (NYSE:LHO) ("LaSalle") and affiliates of The
Blackstone Group L.P. (NYSE:BX) ("Blackstone"), which is scheduled for
a vote on September 6, 2018.

"We are pleased with the ISS recommendation that LaSalle shareholders
vote AGAINST the proposed transaction with Blackstone using the GOLD
proxy card," said Jon E. Bortz, Chairman, President and Chief Executive
Officer of Pebblebrook Hotel Trust. "We agree with ISS's conclusion that
‘on a risk-adjusted basis, Blackstone's current offer of $33.50 in cash
does not appear to represent the best alternative for shareholders,' and
their recommendation that LaSalle shareholders vote AGAINST using the
GOLD proxy card provides independent, third-party validation of our
belief that Pebblebrook's offer is superior," said Bortz.

"The ISS recommendation, together with yesterday's Glass Lewis
recommendation, represent the independent views of the two major
shareholder advisory firms and support Pebblebrook's continuing belief
that a combination of the two companies provides LaSalle shareholders
with superior value," Bortz continued.

"As the owner of 9.8% of LaSalle's outstanding common shares,
Pebblebrook is aligned with a number of the points made by ISS in the
report, including the following:

  • ‘The consideration of the Blackstone deal is less than the current
    value of Pebblebrook's competing bid, and less than the current value
    of LHO shares—a plain indication that the market sees greater value in
    alternatives other than the current Blackstone deal. In the case of an
    alternative combination with Pebblebrook, shareholders stand to
    benefit from a high degree of synergy potential—synergy potential
    which has inspired sufficient confidence to push LHO and PEB
    valuations up significantly in recent months.'
  • ‘Rarely are shareholders afforded the opportunity to witness shares of
    a target company consistently trading at a sizable spread to an agreed
    cash deal. Rarer still is the instance of seeing a target trade at a
    positive spread when it has cut its dividend and subsequently deemed a
    financial acquirer's offer as superior to its standalone case. Yet,
    LaSalle has traded precisely so, to the tune of over 120 million
    shares since the proposed deal was announced on May 21. In this regard
    it would seem that Blackstone's proposed cash deal has set a value
    floor for LHO, rather than a ceiling.'
  • ‘While the adage "cash is king" has many axiomatic applications, it is
    less relevant as reasoning to forego investments that add up as being
    superior on a risk/reward basis….For LHO shareholders, it would be
    much easier to crown cash as king, for instance, at a per-share cash
    amount somewhere between the current value of Pebblebrook's competing
    bid ($36.49 as of Aug. 22) and Pebblebrook's current cash election
    amount ($37.80), with the latter arguably representing a
    straightforward proxy for full valuation plus excised risk.'
  • ‘It is surprising that none of Pebblebrook's competing bids since May
    have led the [LaSalle] board to declare, at the very least, that these
    could lead to a superior offer, perhaps spurring an open bidding
    exchange between Blackstone and Pebblebrook. Some investors have taken
    this as a signal of possible intransigence and perhaps an indication
    of a different kind of downside risk—that the board would forego the
    opportunity to negotiate Pebblebrook's latest offer. During engagement
    with ISS, LaSalle representatives stated they would eventually
    consider Pebblebrook's offer as part of a review of strategic
    opportunities in the event the Blackstone merger is terminated.
    Nonetheless, the company's public disclosure and engagement with
    certain investors seem to have raised concerns over a possible lack of
    receptiveness towards a deal with Pebblebrook, which is all the more
    puzzling given the fact that LHO and PEB management teams share such
    an extensive personal history.'
  • ‘Though timing risk may be inherent in reaching a new deal, and
    execution risk would be inherent in achieving the projected synergies,
    the market seems to have settled on a valuation superior to the
    Blackstone offer, even while likely accounting for these risks. This
    seems reasonable given that 1) Pebblebrook has indicated its ability
    and commitment to move quickly on executing a deal, suggesting it
    stands ready to execute an agreement on the proposed terms and expects
    to close the deal within 90 days of execution, and 2) achieving only a
    fraction of the synergy value has the potential to support valuations
    above $33.50.'

Bortz concluded, "We encourage the LaSalle Board to act in their
shareholders' best interests by engaging with Pebblebrook immediately to
reach an agreement on the basis of our superior August 21, 2018 offer
that will maximize value for all LaSalle shareholders. We believe we can
complete a Pebblebrook-LaSalle transaction within 75 to 90 days after
agreeing with LaSalle, including receiving approvals from shareholders
of each company within that timeframe. We intend to use the GOLD proxy
card to vote our 10.8 million shares AGAINST the LaSalle-Blackstone
take-under proposal, and we encourage all LaSalle shareholders to
protect the value of their investment by doing the same."

For additional information on Pebblebrook's August 21, 2018 offer,
including investor presentations, press releases, SEC filings and
shareholder voting instructions to vote using the GOLD proxy card, visit
the Investor Relations section of Pebblebrook's website at investor.pebblebrookhotels.com,
or by clicking here.

Raymond James and BofA Merrill Lynch are acting as financial advisors,
Hunton Andrews Kurth LLP is acting as legal counsel and Okapi Partners
LLC is serving as information agent to Pebblebrook in connection with
the proposed transaction.

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 28 hotels, with a total of
6,973 guest rooms. The Company owns hotels located in 9 states and the
District of Columbia, including: Los Angeles, California (Beverly Hills,
Santa Monica and West Hollywood); San Diego, California; San Francisco,
California; Washington, DC; Coral Gables, Florida; Naples, Florida;
Buckhead, Georgia; Boston, Massachusetts; Minneapolis, Minnesota;
Portland, Oregon; Philadelphia, Pennsylvania; Nashville, Tennessee;
Columbia River Gorge, Washington; and Seattle, Washington. For more
information, please visit us at www.pebblebrookhotels.com
and follow us on Twitter at @PebblebrookPEB.

ADDITIONAL INFORMATION

This communication does not constitute an offer to buy or solicitation
of an offer to sell any securities. This communication relates to a
proposal which Pebblebrook has made for a business combination
transaction with LaSalle. In furtherance of this proposal and subject to
future developments, Pebblebrook (and, if a negotiated transaction is
agreed, LaSalle) may file one or more registration statements, proxy
statements, tender or exchange offer statements, prospectuses or other
documents with the SEC. This communication is not a substitute for any
proxy statement, registration statement, tender or exchange offer
statement, prospectus or another document Pebblebrook or LaSalle may
file with the SEC in connection with the proposed transaction. INVESTORS
AND SECURITY HOLDERS OF PEBBLEBROOK AND LASALLE ARE URGED TO READ ANY
SUCH PROXY STATEMENT, REGISTRATION STATEMENT, TENDER OR EXCHANGE OFFER
STATEMENT, PROSPECTUS AND OTHER DOCUMENTS FILED WITH THE SEC CAREFULLY
AND IN THEIR ENTIRETY IF AND WHEN THEY BECOME AVAILABLE AS THEY WILL
CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION. Any
definitive proxy statement or prospectus (if and when available) will be
delivered to shareholders of LaSalle or Pebblebrook, as applicable.
Investors and security holders will be able to obtain free copies of
these documents (if and when available) and other documents filed with
the SEC by Pebblebrook through the website maintained by the SEC at http://www.sec.gov.

Pebblebrook or LaSalle and their respective trustees and executive
officers and other members of management and employees may be deemed to
be participants in the solicitation of proxies in respect of the
proposed transaction. You can find information about Pebblebrook's
executive officers and trustees in Pebblebrook's definitive proxy
statement filed with the SEC on April 27, 2018. You can find information
about LaSalle's executive officers and trustees in LaSalle's definitive
proxy statement filed with the SEC on March 22, 2018. Additional
information regarding the interests of such potential participants will
be included in one or more registration statements, proxy statements,
tender or exchange offer statements or other documents filed with the
SEC if and when they become available. You may obtain free copies of
these documents using the sources indicated above.

In connection with the proposed merger transaction between LaSalle and
affiliates of Blackstone, which Pebblebrook opposes (the "Proposed BRE
Merger"), LaSalle filed a definitive proxy statement with the SEC on
July 30, 2018 (the "LaSalle Proxy Statement"). On July 30, 2018,
Pebblebrook filed a definitive proxy statement with the SEC in
opposition to that proposed merger transaction (the "Pebblebrook Proxy
Statement"). This communication is not a substitute for the LaSalle
Proxy Statement or the Pebblebrook Proxy Statement or for any other
document that LaSalle or Pebblebrook have filed or may file with the SEC
or send to LaSalle shareholders in connection with the Proposed BRE
Merger. BEFORE MAKING ANY VOTING DECISION, INVESTORS AND SECURITY
HOLDERS OF LASALLE ARE URGED TO READ THE LASALLE PROXY STATEMENT, THE
PEBBLEBROOK PROXY STATEMENT AND OTHER DOCUMENTS FILED WITH THE SEC
CAREFULLY AND IN THEIR ENTIRETY BECAUSE THEY CONTAIN IMPORTANT
INFORMATION ABOUT PEBBLEBROOK, LASALLE, THE PROPOSED BRE MERGER AND
RELATED MATTERS. Investors and security holders can obtain free copies
of the LaSalle Proxy Statement, the Pebblebrook Proxy Statement and
other documents filed by LaSalle or Pebblebrook with the SEC through the
website maintained by the SEC at http://www.sec.gov.
Copies of the documents filed by LaSalle with the SEC are also available
free of charge on LaSalle's website at www.lasallehotels.com,
or by contacting LaSalle's Investor Relations Department at (301)
941-1500. Copies of the documents filed by Pebblebrook with the SEC are
also available free of charge on Pebblebrook's website at www.pebblebrookhotels.com,
or by contacting Pebblebrook's Investor Relations at (240) 507-1330.
LaSalle and its trustees and certain of its executive officers may be
considered participants in the solicitation of proxies from LaSalle's
shareholders concerning the Proposed BRE Merger under the rules of the
SEC. Information about the trustees and executive officers of LaSalle is
set forth in LaSalle's Annual Report on Form 10-K for the year ended
December 31, 2017, which was filed with the SEC on February 20, 2018,
LaSalle's proxy statement for its 2018 annual meeting of shareholders,
which was filed with the SEC on March 22, 2018, and in subsequent
documents filed by LaSalle with the SEC. Additional information
regarding persons who may be deemed participants in the proxy
solicitations and a description of their direct and indirect interests,
by security holdings or otherwise, is included in the LaSalle Proxy
Statement and may be included in other relevant materials to be filed
with the SEC. Pebblebrook and its trustees and executive officers and
other members of management and employees may be deemed to be
participants in the solicitation of proxies in respect of the Proposed
BRE Merger. You can find information about Pebblebrook's executive
officers and trustees in Pebblebrook's definitive proxy statement filed
with the SEC on April 27, 2018. You may obtain free copies of this
document as described above.

This document shall not constitute an offer to sell or the solicitation
of an offer to buy any securities, nor shall there be any sale of
securities in any jurisdiction in which such offer, solicitation or sale
would be unlawful prior to registration or qualification under the
securities laws of any such jurisdiction. No offering of securities
shall be made except by means of a prospectus meeting the requirements
of Section 10 of the Securities Act of 1933, as amended.

Forward-Looking Statements

This communication may include "forward-looking statements" within the
meaning of the Private Securities Litigation Reform Act of 1995. These
forward-looking statements include, but are not limited to, statements
regarding Pebblebrook's offer to acquire LaSalle, its financing of the
proposed transaction, its expected future performance (including
expected results of operations and financial guidance), and the combined
company's future financial condition, operating results, strategy and
plans. Forward-looking statements may be identified by the use of the
words "anticipates," "expects," "intends," "plans," "should," "could,"
"would," "may," "will," "believes," "estimates," "potential," "target,"
"opportunity," "tentative," "positioning," "designed," "create,"
"predict," "project," "seek," "ongoing," "upside," "increases" or
"continue" and variations or similar expressions. These statements are
based upon the current expectations and beliefs of management and are
subject to numerous assumptions, risks and uncertainties that change
over time and could cause actual results to differ materially from those
described in the forward-looking statements. These assumptions, risks
and uncertainties include, but are not limited to, assumptions, risks
and uncertainties discussed in Pebblebrook's most recent annual or
quarterly report filed with the SEC and assumptions, risks and
uncertainties relating to the proposed transaction, as detailed from
time to time in Pebblebrook's and LaSalle's filings with the SEC, which
factors are incorporated herein by reference. Important factors that
could cause actual results to differ materially from the forward-looking
statements made in this communication are set forth in other reports or
documents that Pebblebrook may file from time to time with the SEC, and
include, but are not limited to: (i) the ultimate outcome of any
possible transaction between Pebblebrook and LaSalle, including the
possibilities that LaSalle will reject a transaction with Pebblebrook,
(ii) the ultimate outcome and results of integrating the operations of
Pebblebrook and LaSalle if a transaction is consummated, (iii) the
ability to obtain regulatory approvals and meet other closing conditions
to any possible transaction, including the necessary shareholder
approvals, and (iv) the risks and uncertainties detailed by LaSalle with
respect to its business as described in its reports and documents filed
with the SEC. All forward-looking statements attributable to Pebblebrook
or any person acting on Pebblebrook's behalf are expressly qualified in
their entirety by this cautionary statement. Readers are cautioned not
to place undue reliance on any of these forward-looking statements.
These forward-looking statements speak only as of the date hereof.
Pebblebrook undertakes no obligation to update any of these
forward-looking statements to reflect events or circumstances after the
date of this communication or to reflect actual outcomes.

For additional information or to receive press releases via email,
please visit our website at
www.pebblebrookhotels.com

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