BETHESDA, Md.—October 3, 2018–RLJ Lodging Trust (the “Company”) (NYSE:RLJ) today announced that the Company has sold the 309-room DoubleTree by Hilton Burlington Vermont (“Burlington”) for $35.0 million. Based on the trailing twelve months ended August 2018, the sales price represents a 17.3x EBITDA multiple and 4.5% capitalization rate, inclusive of required capital expenditures.
“The sale of Burlington at a highly attractive valuation once again underscores the great strides we have made in harvesting value from the sale of the non-core assets we had identified,” commented Leslie D. Hale, President and Chief Executive Officer. “Since December, the Company has sold approximately $630 million of assets in aggregate at an EBITDA multiple over 16x. We remain on pace to achieve all of our 2018 strategic objectives as we position our portfolio for 2019 and beyond.”
The Company estimates the sale of the Burlington will reduce its full year 2018 outlook by the following:
- Pro forma Consolidated Hotel EBITDA by $3 million for the full year
- Adjusted EBITDA by $1 million for the fourth quarter and full year
Third Quarter Update
Ms. Hale continued, “Our thoughts are with everyone who has been impacted by Hurricane Florence, and we’d like to thank our team for their efforts during this difficult time. We are pleased to report that we had no significant damage at our hotels. However, due to evacuations and cancellations in the affected areas, we did see an impact on our performance.”
The Company is providing a third quarter Pro Forma Consolidated Hotel EBITDA and Adjusted EBITDA outlook that includes the impact from Hurricane Florence and recently announced dispositions. The Company’s four hotels in Charleston, South Carolina and Myrtle Beach, South Carolina were closed for several days due to Hurricane Florence. Although no hotels suffered significant damage and all hotels were operational by September 14, 2018, they experienced a reduction in demand subsequent to the hurricane due to cancellations. Additionally, Hurricane Florence resulted in cancellations in other markets, such as Washington, D.C. and New York.
For the third quarter, the Company expects:
- Pro forma Consolidated Hotel EBITDA of $135 to $138 million
- Adjusted EBITDA of $128 to $131 million
The Company expects to provide an update to full-year RevPAR, Pro Forma Consolidated EBITDA and Adjusted EBITDA outlook in its third quarter earnings release.