Pebblebrook Hotel Trust plans to sell as much as $1 billion in assets after it completes its acquisition of LaSalle Hotel Properties, as the combined company seeks to reduce debt through opportunistic sales.
Pebblebrook, which agreed last week to acquire LaSalle for about $5.2 billion including debt, is already under contract to sell three LaSalle properties for $715 million when the merger closes. They are the Park Central San Francisco and two Manhattan hotels considered sister properties, the Park Central New York and the WestHouse hotel, executives said on a conference call with analysts Thursday.
Chief Executive Officer Jon Bortz said he remained bullish on the West coast and that the additional asset sales would probably increase Pebblebrook’s concentration in the market, meaning the sales would come from other regions.
“We do have an incredibly positive view of San Francisco,” Bortz said on the call. “We think the dynamics there are pretty stupendous from a demand-and-supply perspective.”
Pebblebrook, which topped a bid from Blackstone Group LP to acquire LaSalle, will have 66 hotels, most of which fall in the luxury and higher-upscale categories. The deal, expected to close by early December, will create the largest owner of independent lodging properties just as a strong U.S. economy is encouraging businesses and consumers to increase spending on travel.
Source: Reuters.com