BETHESDA, Md.--(BUSINESS WIRE)--RLJ Lodging Trust (the “Company”) (NYSE: RLJ) today announced that it has opened its Hotel Indigo New Orleans Garden District (the “Hotel”). With the opening of this hotel, the Company has completed its seventh and final brand conversion that was planned as part of its comprehensive 2011 and 2012 capital program.
“Management’s Discussion and Analysis of Results of Operations and Financial Condition”
“We are excited to open a uniquely designed upscale hotel in New Orleans, a dynamic urban market with multiple demand generators,” said Thomas J. Baltimore, Jr., President and Chief Executive Officer. “We expect the Hotel to benefit from the positive trends that we are seeing from the New Orleans market as well as benefit from the positive traction the Indigo brand is making in increasing its brand distribution.”
The Hotel operated as an independent hotel until it was closed in 2008. The Company purchased the distressed hotel in 2010 for $6.4 million. After an extensive $16.9 million renovation, the property reopened as a 132-room Hotel Indigo. The all-in price of $23.3 million, or approximately $177,000 per key, represents a significant discount to replacement cost.
“This hotel’s uniquely modern design truly captures New Orleans’ character,” said Carl Mayfield, Senior Vice President of Design and Construction. “The oversized guestrooms and spacious bathrooms combined with the stylish public space design truly highlight New Orleans’ Historic Garden District. The many facets of this hotel’s unique design include locally inspired murals, decorative ironwork, and reclaimed wood ceiling resonate New Orleans and its local culture and flavor.”
New Orleans, known as the birthplace of jazz, features a variety of entertainment venues and activities in the city. One of the main attractions is the French Quarter, the oldest neighborhood in the city featuring a mixture of Spanish, French, Creole and American architecture. The city also hosts a variety of special events each year; the most famous event is Mardi Gras which includes musical celebrations, a grand parade, and other entertainment throughout the city. In addition to the various tourist attractions, the area’s location near the Gulf of Mexico and the large contingency of offshore oil rigs allow New Orleans to host a strong corporate base for on and offshore petroleum and natural gas production. New Orleans’ diverse economy in oil refining, port activity, and tourism provides multiple demand generators for the market.
New Orleans continues to show strong recovery from the effects of Hurricane Katrina. The market area has experienced growth in both population and tourism in recent years. Out of the top 25 U.S. hotel markets that Smith Travel Research tracks, New Orleans revenue per available room growth of 15.9% year-to-date through November has outpaced San Francisco, Los Angeles, and Boston.
The Hotel’s prime urban location along the St. Charles Street Car line in the Garden District provides it with direct and convenient access to a wide variety of demand generators. The Garden District along St. Charles Avenue is a well-known landmark in New Orleans that features a collection of historic southern mansions and plantations surrounded by beautiful gardens. Additionally, this centrally-located hotel is proximate to Tulane and Loyola Universities, is on the famed Mardi Gras parade route, and is also within a short walk of New Orleans’ central business district and the French Quarter, providing it access to both business and leisure travelers.
The Company used cash available on its balance sheet to fund the conversion.
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 145 hotels in 21 states and the District of Columbia, with a total of more than 21,600 rooms. Additional information may be found on the Company's website: http://rljlodgingtrust.com.
Forward Looking Statements
This press release may contain forward-looking statements within the meaning of the federal securities laws. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. In some cases, you can identify forward-looking statements by the use of forward-looking terminology such as “may,” “will,” “should,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” or “potential” or the negative of these words and phrases or similar words or phrases which are predictions of or indicate future events or trends and which do not relate solely to historical matters. Forward-looking statements involve known and unknown risks, uncertainties, assumptions and contingencies, many of which are beyond the Company’s control, that may cause actual results to differ significantly from those expressed in any forward-looking statement, including statements related to, among other things, the timing, price or amount of purchases, if any, under the Company's common stock repurchase program, the Company’s target leverage ratio, potential acquisitions or dispositions, the completion of the 2012 capital improvement plan, RevPAR growth, EBITDA growth, Hotel EBITDA margins or cash G&A expenses. All forward-looking statements reflect the Company’s good faith beliefs, assumptions and expectations, but they are not guarantees of future performance. Furthermore, the Company disclaims any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, of new information, data or methods, future events or other changes. For a further discussion of these and other factors that could cause the Company’s future results to differ materially from any forward-looking statements, see the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Results of Operations and Financial Condition” in the Company's Annual report on Form 10-K for the year ended December 31, 2011, and other risks described in documents subsequently filed by the Company from time to time with the Securities and Exchange Commission.
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