RLJ Lodging Trust Sells the Sheraton Philadelphia Society Hill for $95.5 Million or Approximately $262,000 Per Key
RLJ Lodging Trust (the “Company”) (NYSE:RLJ) today announced that the Company has sold the 364-room Sheraton Philadelphia Society Hill (“Sheraton Philadelphia”) in Philadelphia, PA for $95.5 million or approximately $262,000 per key.
“The sale of another non-core asset at a highly accretive valuation highlights the meaningful progress we have achieved in realizing the embedded value from the FelCor merger,” commented Ross H. Bierkan, President and Chief Executive Officer. “Not only is this disposition highly accretive on a valuation basis, but it is also accretive to our portfolio RevPAR and EBITDA margin. With this transaction, we have accomplished our initial goal of generating approximately $300 million from asset sales at an attractive aggregate multiple. We remain laser-focused on unlocking the embedded value within our portfolio through executing on our strategic initiatives. We continue to expect to execute on a second round of asset sales that will generate an additional $200 million to $400 million in proceeds this year.”
The transaction sale price represents a 14.7x multiple on the hotel's 2017 EBITDA and approximately a 5.6% capitalization rate on the hotel's 2017 net operating income, which excludes planned capital expenditures. The hotel EBITDA margin for the Sheraton Philadelphia was 28.0% in 2017, below the Company's reported 33.1% EBITDA margin for the year. The hotel's 2017 RevPAR was $119.12 compared with the portfolio average of $135.82.
The Company intends to apply the net proceeds from the sale to pay down its credit facility and for general corporate purposes.
About RLJ
RLJ Lodging Trust is a self-advised, publicly traded real estate investment trust focused on acquiring premium-branded, focused-service and compact full-service hotels. The Company's portfolio consists of 155 hotels with approximately 30,200 rooms located in 26 states and the District of Columbia and an ownership interest in one unconsolidated hotel with 171 rooms.
Marriott International, Inc. (NASDAQ: MAR) is a global leading lodging company based in Bethesda,Maryland, USA, with more than 4,200 properties in 80 countries and territories. Marriott International reported revenues of nearly $14 billion in fiscal year 2014. The company operates and franchises hotels and licenses vacation ownership resorts under 19 brands, including: The Ritz-Carlton®, BVlgari®, EDITION®, JW Marriott®, Autograph Collection® Hotels, Renaissance® Hotels, Marriott Hotels®, Delta Hotels and Resorts®, Marriott Executive Apartments®, Marriott Vacation Club®, Gaylord Hotels®, AC Hotels by Marriott®, Courtyard®, Residence Inn®, SpringHill Suites®, Fairfield Inn & Suites®, TownePlace Suites®, Protea Hotels® and MoxyHotels®. Marriott has been consistently recognized as a top employer and for its superior business ethics. The company also manages the award-winning guest loyalty program, Marriott Rewards® and The Ritz-Carlton Rewards® program, which together surpass 50 million members. For more information or reservations, please visit our website at 
