LaSalle Hotel Properties Announces Sale of the Chicago Marriott Downtown; Company to Recognize Gain of Approximately $38 Million
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LaSalle Hotel Properties Announces Sale of the Chicago Marriott Downtown; Company to Recognize Gain of Approximately $38 Million
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Category: North America & West Indies / Carribean islands
This is a press release selected by our editorial committee and published online for free on 2006-03-28
LaSalle Hotel Properties (NYSE:LHO) today announced that Chicago 540, LLC, a joint venture with The Carlyle Group, closed on the sale of the Chicago Marriott Downtown for $295 million plus approximately $11 million of other consideration. The hotel was purchased by the joint venture in 2000 for $175 million. LaSalle Hotel Properties will recognize an approximate gain of $38 million including its preferred distribution of approximately $25 million resulting in a leveraged internal rate of return ("IRR") of approximately 47% for the six year hold period. The preferred distribution to LHO is a result of The Carlyle Group achieving a leveraged IRR on their investment above the stated return thresholds in the partnership agreement.
LaSalle Hotel Properties is a leading multi-tenant, multi-operator real estate investment trust, owning 28 upscale and luxury full-service hotels, totaling approximately 8,400 guest rooms in 15 markets in 11 states and the District of Columbia. The Company focuses on investing in upscale and luxury full-service hotels located in urban, resort and convention markets. LaSalle Hotel Properties seeks to grow through strategic relationships with premier hotel operating companies, including Westin Hotels and Resorts, Sheraton Hotels & Resorts Worldwide, Inc., Crestline Hotels and Resorts, Inc., Outrigger Lodging Services, Noble House Hotels & Resorts, Hyatt Hotels Corporation, Hilton Hotels Corporation, Benchmark Hospitality, White Lodging Services Corporation, Sandcastle Resorts & Hotels, Davidson Hotel Company, Gemstone Resorts International, LLC and the Kimpton Hotel & Restaurant Group, LLC.
This press release, together with other statements and information publicly disseminated by the Company, contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The Company intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and includes this statement for purposes of complying with these safe harbor provisions. Forward-looking statements, which are based on certain assumptions and describe the Company's future plans, strategies and expectations, are generally identifiable by use of the words "believe," "expect," "intend," "anticipate," "estimate," "project" or similar expressions. Forward-looking statements in this press release include, among others, statements about recognizing a $38 million gain including a $25 million preferred distribution resulting in a leveraged IRR of 47%. You should not rely on forward-looking statements since they involve known and unknown risks, uncertainties and other factors that are, in some cases, beyond the Company's control and which could materially affect actual results, performances or achievements. Factors that may cause actual results to differ materially from current expectations include, but are not limited to, (i) the Company's dependence on third-party managers of its hotels, including its inability to implement strategic business decisions directly, (ii) risks associated with the hotel industry, including competition, increases in wages, energy costs and other operating costs, actual or threatened terrorist attacks, downturns in general and local economic conditions and cancellation of or delays in the completion of anticipated demand generators, (iii) the availability and terms of financing and capital and the general volatility of securities markets, (iv) risks associated with the real estate industry, including environmental contamination and costs of complying with the Americans with Disabilities Act and similar laws, (v) interest rate increases, (vi) the possible failure of the Company to qualify as a REIT and the risk of changes in laws affecting REITs, (vii) the possibility of uninsured losses, and (viii) the risk factors discussed in the Company's Annual Report on Form 10-K. Accordingly, there is no assurance that the Company's expectations will be realized. Except as otherwise required by the federal securities laws, the Company disclaims any obligation or undertaking to publicly release any updates or revisions to any forward-looking statement contained herein (or elsewhere) to reflect any change in the Company's expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.
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