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LaSalle buys Washington DC hotel for nearly $144M

Fri, 03/09/2012 - 7:13am
The Associated Press

LaSalle Hotel Properties said on Friday that it bought the Hotel Palomar in Washington D.C. for $143.8 million in an off-market transaction.

LaSalle said the seller is a discretionary equity fund sponsored by Kimpton Hotel and Restaurant Group, which will continue to manage the boutique hotel.

LaSalle, a real estate investment trust, raised its full-year financial forecast as a result of the acquisition. LaSalle now expects adjusted funds from operations to range from $2 to $2.12 per share in 2012, up from the company's prior expectations for $1.92 to $2.05.

Analysts, on average, had been expecting adjusted FFO of $1.80 per share, according to FactSet.

Funds from operations adds items like amortization and depreciation to net income, and is considered a key measure of strength for REITs like LaSalle.

La Salle said it paid for the Hotel Palomar acquisition with proceeds from a recent sale of common shares that raised $46.6 million, and through borrowing from an unsecured credit agreement.

The Hotel Palomar is a 335-guest room hotel located one block from Dupont Circle in Washington, near a cluster of foreign embassies as well as Georgetown and George Washington universities.

Shares of LaSalle rose 68 cents, or about 2.5 percent, to $27.12 in morning trading. The stock is near its 52-week high of $28.69, reached in April. Shares traded as low as $15.17 in August.

LaSalle owns 38 upscale hotels in 13 markets across the nation.

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