BETHESDA, MD—Pebblebrook Hotel Trust has closed on the sale of the 618-room, upper-upscale, full-service Manhattan NYC Hotel for $217.5 million on Dec. 20.
The sale price reflects a 19.9x EBITDA multiple and a 4.1% net operating income capitalization rate—after an assumed annual capital reserve of 4% of total hotel revenues—based on the hotel’s 2016 projected operating performance.
“We are very pleased with the sale of the Manhattan NYC,” said Jon E. Bortz, chairman, president and CEO of Pebblebrook Hotel Trust. “This sale represents our second significant step towards successfully reducing our exposure to the New York market. The Manhattan NYC marks the fourth hotel sold under our strategic disposition plan that we initiated earlier this year, which has generated almost $500 million in gross proceeds. These dispositions have allowed us to take advantage of the imbalance between the higher private market values for our hotels and the lower value of our company as determined by the public market.”
According to the company, proceeds from the sale of the Manhattan NYC will be utilized to repay the $140-million loan secured by the property and for general business purposes.