BETHESDA, Maryland--LaSalle Hotel Properties (NYSE: LHO) today announced results for the quarter and year ended December 31, 2013.
Fourth Quarter Results and Activities
Results excluding Park Central Hotel
- RevPAR excluding Park Central Hotel: Room revenue per available room (“RevPAR”) for the quarter ended December 31, 2013 increased 5.2 percent to $157.05, as a result of a 3.3 percent increase in average daily rate (“ADR”) to $212.21 and a 1.9 percent increase in occupancy to 74.0 percent.
- Hotel EBITDA Margin excluding Park Central Hotel: The Company’s hotel EBITDA margin for the fourth quarter was 29.9 percent, a 142 basis point improvement compared to the comparable prior year period.
Entire Portfolio Results
- RevPAR: RevPAR for the quarter ended December 31, 2013 increased 3.3 percent to $163.96, as a result of a 2.5 percent increase in ADR to $218.55 and a 0.7 percent increase in occupancy to 75.0 percent.
- Hotel EBITDA Margin: The Company’s hotel EBITDA margin for the fourth quarter was 30.6 percent, a 20 basis point increase compared to the comparable prior year period.
- Adjusted EBITDA: The Company’s adjusted EBITDA was $72.9 million, an increase of 17.2 percent over the fourth quarter of 2012. During the fourth quarter of 2013, the Company’s financial results were impacted by $3.3 million of EBITDA displacement from the Park Central and WestHouse renovation project.
- Adjusted FFO: The Company generated fourth quarter adjusted FFO of $55.8 million, or $0.55 per diluted share/unit, compared to $41.3 million or $0.47 per diluted share/unit for the comparable prior year period.
- Capital Markets: During the fourth quarter 2013, the Company sold 7,705,000 common shares of beneficial interest, including the exercise of the underwriters’ option to purchase additional shares, at a public offering price of $30.05 per share, resulting in net proceeds of $228.4 million.
- Capital Investments: The Company invested $34.6 million of capital in its hotels, much of which pertained to the continuation of the Park Central Hotel and WestHouse renovation in New York City. During the fourth quarter, the Company also completed a guestroom renovation at Viceroy Santa Monica. Renovations were commenced at Onyx Hotel in Boston, Hilton Alexandria Old Town, as well as Hotel George and Donovan House in Washington, DC.
- Dividends: On December 13, 2013, the Company declared a fourth quarter 2013 dividend of $0.28 per common share of beneficial interest.
“We were pleased to complete 2013 with another quarter of strong results, topping off a successful year for the Company,” said Michael D. Barnello, President and Chief Executive Officer of LaSalle Hotel Properties. “LaSalle had a solid year operationally and with respect to acquisitions and capital markets activities. We achieved new portfolio records for ADR, Occupancy, RevPAR and hotel EBITDA margins. As a result, our corporate adjusted EBITDA grew 14 percent during 2013 and AFFO per share was up 11 percent.”
“We opportunistically issued preferred equity at 6.375% and achieved the lowest coupon on record for a lodging REIT,” he continued. “We also made meaningful acquisitions in the high-barrier-to-entry, high-demand markets of San Francisco and Key West.”
“During the last quarter of 2013, we completed our renovation of Park Central Hotel and the creation of WestHouse. We are ecstatic about the product we have to offer at both hotels. The project was transformational and we are very encouraged about the assets’ prospects for growth.”
“As we look to 2014, we started the year strong by extending the maturities and lowering interest costs with respect to our $750.0 million revolver and $300.0 million term loan. Furthermore, we have the ability to expand those instruments by $500.0 million, collectively, providing additional capacity to execute our business plan going forward.”
“Our industry continues to operate in a favorable environment, with an improving economy, continued lodging industry demand growth and limited supply growth. We continue to make impactful investments in our hotel portfolio and are positioned to deliver another year of solid results.”
Full Year 2013 Results and Activities
Results excluding Park Central Hotel
- RevPAR: RevPAR increased 5.6 percent to $167.39, as a result of a 3.1 percent increase in occupancy to 80.0 percent and a 2.4 percent increase in ADR to $209.19.
- Hotel EBITDA Margin: The Company’s hotel EBITDA margin was 32.3 percent, which represents an improvement of 84 basis points compared to 2012.
Entire Portfolio Results
- RevPAR: RevPAR increased 2.8 percent to $167.62, as a result of a 2.7 percent increase in ADR to $211.52 and a 0.1 percent increase in occupancy to 79.2 percent. In 2013, the Company achieved its highest-ever reported ADR, Occupancy and RevPAR.
- Hotel EBITDA Margin: The Company’s hotel EBITDA margin was 32.2 percent, which was its highest-ever reported margin and represents an improvement of 19 basis points compared to 2012.
- Adjusted EBITDA: The Company’s adjusted EBITDA was $300.1 million, an increase of 14.0 percent over 2012. During 2013, the Company’s financial results were impacted by $11.3 million of EBITDA displacement from the Park Central and WestHouse renovation project.
- Adjusted FFO: The Company generated adjusted FFO of $224.6 million, or $2.30 per diluted share/unit, an increase of 10.6 percent over the prior year.
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Acquisitions: The Company invested $303.8 million to acquire four assets. The 2013 acquisitions include the following:
- Hotel Triton and Harbor Court Hotel, both in San Francisco, CA for $47.8 million on August 1;
- Serrano Hotel in San Francisco, CA for $71.5 million on August 21; and
- Southernmost Hotel Collection in Key West, FL for $184.5 million on August 27.
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Capital Markets: The Company completed several capital markets initiatives during 2013 including the following:
- During first quarter 2013, the Company sold 4,400,000 Series I Cumulative Redeemable Preferred Shares at a 6.375 percent coupon, resulting in proceeds of $110.0 million.
- During the second quarter 2013, the Company redeemed 4,000,000 Series G Cumulative Redeemable Preferred Shares, which were subject to a 7.25 percent coupon.
- During May 2013, the Company sold 721,706 common shares through its ATM program for net proceeds of $19.7 million.
- During the fourth quarter 2013, the Company sold 7,705,000 common shares of beneficial interest, including the exercise of the underwriters’ option to purchase additional shares, at a public offering price of $30.05 per share, resulting in net proceeds of $228.4 million.
- Capital Investments: The Company invested $119.4 million of capital in its hotels throughout the year, completing the Park Central and WestHouse renovation in Manhattan, the renovation of Hotel Monaco San Francisco, Hotel Madera in Washington, DC, Hotel Deca in Seattle and the Viceroy Santa Monica. The Company’s 2013 capital expenditures include $57.8 million of costs for the Park Central and WestHouse project. The Company’s capital investments also include the commencement of the renovation of the Onyx Hotel in Boston, Hilton Alexandria Old Town, as well as Hotel George and Donovan House in Washington, DC.
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