BETHESDA, Md. — Pebblebrook Hotel Trust (NYSE: PEB) (the “Company”) today announced that it closed on the sale of the 132-room Hotel Amarano Burbank in Los Angeles, California for $72.9 million.
The sale price of $72.9 million reflects a 15.8x EBITDA multiple and a 5.7% net operating income capitalization rate (after an assumed annual capital reserve of 4.0% of total hotel revenues) based on the hotel’s operating performance for 2018. Based on the trailing 12-month period ended March 2019, the contracted sales price reflects a 16.9x EBITDA multiple and a 5.3% net operating income capitalization rate (after an assumed annual capital reserve of 4.0% of total hotel revenues). Both the EBITDA multiples and net operating income capitalization rates are adjusted for the estimated annualized impact of real estate taxes for California’s Proposition 13.
Proceeds from the sale of the Hotel Amarano Burbank will be utilized for general business purposes which may include reducing the Company’s outstanding debt. As a result of this completed sale, the Company estimates its total net debt to trailing 12-month corporate EBITDA will be approximately 4.6 times at the end of the third quarter 2019.
