RLJ completes acquisition of Moxy Denver Cherry Creek and divestment of DoubleTree Metropolitan

BETHESDA, Maryland – (COMMERCIAL THREAD) – RLJ Lodging Trust (the “Company” (NYSE: RLJ) today announced the acquisition of the 170-room Moxy Denver Cherry Creek (“Moxy Cherry Creek”) for a purchase price of $ 51.3 million of dollars, or approximately $ 301,000 per key, and completed the sale of the 764-room DoubleTree Hotel Metropolitan New York City (the “DoubleTree Metropolitan”) for gross proceeds of $ 169.0 million.

“We are delighted to acquire the newly constructed Moxy Cherry Creek Hotel located in the heart of the exclusive Cherry Creek submarket in Denver, which is expected to generate disproportionate growth for years to come. In 2021, we successfully acquired three high quality hotels in high growth markets for nearly $ 200 million, which will enhance our growth profile throughout this cycle, ”commented Leslie D. Hale, President and CEO. “In addition, we completed the divestment of DoubleTree Metropolitan at a highly accretive valuation. Overall, we were successful in matching three funded acquisitions with the proceeds from the disposal of non-core hotels, which sold at a multiple that was more than 15 times greater than our acquisitions. We entered 2022 with a substantial investment capacity, which will allow us to continue implementing external and internal growth initiatives throughout the year. ”

Acquisition of Moxy Denver Cherry Creek

The 170-room Moxy Cherry Creek opened in late 2017 and is expected to generate an estimated stabilized NOI return of 8.0% to 8.5%. Moxy Cherry Creek is expected to generate a stabilized RevPAR premium of 15% to 20% compared to the Company’s existing portfolio in 2019, with hotel EBITDA margins above 600 to 800 basis points. The Company has hired the well-respected Denver-based Sage Hospitality Group to manage Moxy Cherry Creek. The Company financed the acquisition by combining the cash flow of the business and the assumption of $ 25.0 million of secured non-recourse debt. The seller is BMC Investments, a leading high quality, fully integrated and experienced commercial real estate developer based in Denver, USA.

The hotel is one of five hotels located in Denver’s upscale central Cherry Creek North neighborhood, with more than 100 retail stores and 50 restaurants located within a four-block radius of the property. The hotel has amenities such as the Moxy Bar and Cherry Creek Beer Garden, in addition to meeting rooms, an outdoor event space, free bicycle rentals, and a state-of-the-art fitness center.

Cherry Creek is Denver’s premier high-end and lifestyle sub-market experiencing significant growth in office space, residential units and mixed-use project development, which will continue to support this region’s growth. Cherry Creek North hotels generally generate a higher ADR premium than comparable hotels located in downtown Denver.

Denver is one of the fastest growing metropolitan areas in the country which benefits from population growth and business relocations / expansions. The city’s ‘quality of life’ attributes and outdoor lifestyle have resulted in an 18% increase in the number of its residents, especially millennials, over the past decade and the region continues to grow. ‘attract companies such as Amazon, Apple, Palantir, Robinhood and Zoom, among others. . Denver is also home to a diverse base of industries which include a number of Fortune 500 companies. Employment and population growth trends in Denver are expected to continue to outperform the national average over the next several years. Denver remains a top destination, welcoming nearly 18 million overnight visitors in 2019, and is also an emerging meeting destination. Benefiting from the region’s growth, Denver’s RevPAR increased 70 basis points ahead of the top 25 US markets by STR from 2015 to 2019, based on a compound annual growth rate (“CAGR”).

The Marriott’s Moxy brand combines comfort with a bold, sleek industrial design and a modern, relaxed atmosphere, which has appealed to a wide range of clientele segments, including Millennials, who increasingly seek a dynamic, hotel-focused hotel. lifestyle and experience. to stay. Since the opening of the first Moxy in 2016 in the United States, the brand has continued to grow at a steady pace. This growth is driven by the brand’s strong track record of performance, combined with an efficient operating model and affiliation with the accommodation industry’s premier guest loyalty rewards program – Marriott’s Bonvoy.

Layout of DoubleTree Hotel Metropolitan New York City

The company recently closed the previously announced sale of the 764-room DoubleTree Metropolitan for a gross selling price of $ 169.0 million, which is a highly accretive multiple of over 47 times the hotel’s 2019 hotel EBITDA. . Following this divestiture, the Company currently owns two hotels in New York, representing approximately 550 rooms and less than 3.5% of the Company’s 2019 pro forma hotel EBITDA.

About Us

RLJ Lodging Trust is a self-advised, publicly traded real estate investment trust that primarily owns premium, high-margin, focused-service, compact, full-service branded hotels. The Company’s portfolio currently consists of 97 hotels with approximately 21,500 rooms, located in 22 states and the District of Columbia, and an ownership interest in an unbound 171 room hotel.

Forward-looking statements

This information contains certain statements, other than purely historical information, including estimates, projections, statements relating to the business plans, objectives and expected results of operations of the Company, to actions taken in response to the COVID-19 pandemic and the impact of COVID-19. 19 pandemic about our business, and the assumptions on which such statements are based, which are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are generally identified by the use of the words “believe”, “plan”, “expect”, “anticipate”, “estimate”, “plan”, “may”, “may”, “continue” , “” Intend “,” should “or similar expressions. Although the Company believes that the expectations reflected in these forward-looking statements are based on reasonable assumptions, beliefs and expectations, these forward-looking statements are not predictions of future events or guarantees of future performance and actual results of the company. Company could differ materially from those set forth in forward-looking statements. Factors that could cause such a difference include: current global economic uncertainty and worsening global economic conditions or low levels of economic growth; the duration and extent of the COVID-19 pandemic and its impact on travel demand and consumer confidence levels; actions taken by governments, businesses and individuals in response to the pandemic, including limiting or banning travel; the impact of the pandemic on global and regional economies, travel and economic activity; the speed and effectiveness of vaccine and treatment developments and their deployment, including public adoption rates of COVID-19 vaccines and booster injections, and their effectiveness against emerging variants of COVID-19, such as the Delta variant; the pace of recovery as the COVID-19 pandemic subsides; the effects of actions we and our third party management partners take to reduce operating costs; increased direct competition, changes in government regulations or accounting rules; changes in local, national and global real estate conditions; the decline of the accommodation industry, particularly due to the COVID-19 pandemic; seasonality of the accommodation industry; risks associated with natural disasters, such as earthquakes and hurricanes; hostilities, including future terrorist attacks or fear of hostilities that affect travel and epidemics and / or pandemics, including COVID-19; the Company’s ability to obtain credit lines or permanent financing on satisfactory terms; changes in interest rates; inflation; access to capital through offers of ordinary and preferred shares of beneficial interest or debt of the Company; the Company’s ability to identify appropriate acquisitions; the Company’s ability to complete identified acquisitions and to integrate these businesses; and inaccuracies in the Company’s accounting estimates. In addition, investors are urged to interpret many of the risks identified in the section titled “Risk Factors” in the Company’s Form 10-K for the fiscal year ended December 31, 2020 as being increased due to the numerous impacts. Continuing negatives of the covid19 pandemic. In view of these uncertainties, one should not place undue reliance on these statements. Except as required by law, the Company assumes no obligation to publicly update or revise forward-looking statements, whether as a result of new information, future events or otherwise. The Company cautions investors not to place undue reliance on these forward-looking statements and urges investors to carefully consider the information the Company makes regarding risks and uncertainties in the sections headed “Risk Factors”, “Forward-Looking Statements” and ” “Management’s Discussion and Analysis of “Financial Condition and Results of Operations” in the Company’s Annual Report, as well as the risks, uncertainties and other factors discussed in other documents filed by the Company with the Securities and Exchange Commission.

For more information or to receive press releases by email, please visit our website: http://www.rljlodgingtrust.com

Comments are closed.