The publicly traded real estate investment trust Pebblebrook Hotel Trust has acquired the full-service upscale Redbury Hotel located in Hollywood, Calif. for $34 million.
In 2012, the Redbury Hotel operated at 84% occupancy, with an average daily rate of $274 and room revenue per available room of $230. By the end of 2013, Pebblebrook forecasts that the hotel will generate earnings of $2.75 to $3.0 million.
With this acquisition, Pebblebrook’s portfolio consists of 27 properties, comprising $2.1 billion of invested capital. This acquisition also marks the REIT’s fourth investment in Los Angeles.
“Los Angeles attracts over 25 million total visitors annually and is the second-most visited city by overseas visitors. The steady demand growth of the market, along with a historically constrained supply environment, provides excellent operating fundamentals for the market and the hotel,” said Jon Bortz, chairman, president and chief executive officer of Pebblebrook Hotel Trust.
CIM Group acquired the hotel property through a foreclosure process in February 2010 while it was still under construction. The Los Angeles-based real estate and infrastructure investment firm completed the development and the hotel opened in September 2010 under the management of sbe Group.
The 57-room, all-suite, luxury hotel will continue to be managed by sbe Hotel Group, the Bethesda, Md.-based REIT said.
Every suite at the hotel includes 40- or 46-inch high-definition televisions with DVD access, high-speed wi-fi, oversized walk-in rain showers, floor-to-ceiling windows, private patio or balcony and European-style kitchens with gas burners. The hotel also has a 120-seat ground floor restaurant called Cleo that is acclaimed for its Mediterranean cuisine.
Situated at the intersection of Vine Street and Hollywood Boulevard, the hotel is located right next to the Hollywood Walk of Fame. It is also a block away from the Hollywood/Vine Metro Red Line, which provides guests with nearby access to area attractions like the Hollywood Bowl, Beverly Hills, Century City, UCLA, the Getty Center, Santa Monica and Los Angeles International Airport.
“Partnering with Pebblebrook on the Redbury is a venture with tremendous upside and positions the property for continued success for years to come,” said Sam Nazarian, founder and CEO of sbe Hotel Group in a press release. “Our collective knowledge of the Los Angeles market and vast hotel industry expertise will add tremendous value to the property and provide a strong foundation for our partnership to thrive.”
