LaSalle Hotel Properties had a fourth quarter well accepted by the street, with earnings rising 43 percent. However, the good fortune may not last as the real estate investment trust offered a weak outlook for the new year.
LaSalle has posted double-digit revenue growth in recent quarters on acquisitions and room revenue growth, The Wall Street Journal reports. Revenue for the quarter jumped 17 percent to $252 million, which came in slightly above analysts expectations of $250 million. For the latest period, LaSalle reported earnings of $14.3 million, compared with a year-earlier profit of 10 million.
For 2014, LaSalle expects adjusted funds from operations—a key performance measure in the real-estate sector—in the range of $2.28 to $2.48 per unit. Analysts polled by Thomson Reuters recently expected $2.60 per unit.
“We are very pleased with our results during the fourth quarter as well as the full year 2013,” said Michael D. Barnello, president and CEO of LaSalle Hotel Properties. “Our portfolio delivered another year of excellent performance, achieving new portfolio records in average daily rate, occupancy, RevPAR and hotel EBITDA margins and we remain encouraged that there is still substantial room to grow.
“Additionally, we had a very successful year as we made meaningful acquisitions in the high-barrier-to-entry, high-demand markets of San Francisco and Key West and further strengthened our balance sheet,” he continued. “Given the favorable supply and demand trends, we remain excited about 2014.”
Last August, the REIT announced it had acquired three hotels in Key West, Fla., and one in San Francisco. In Florida, LaSalle acquired the 260-room Southernmost Hotel Collection for $184.5 million. The Collection consists of three separate hotels: Southernmost on the Beach, Southernmost Hotel in the USA and La Mer Hotel & Dewey House.
On the other side of the U.S., it acquired the 236-room Serrano Hotel in San Francisco for $71.5 million.
Now LaSalle is under contract to purchase the leasehold interest in the 200-room Hotel Vitale in San Francisco (pictured) for $130 million.
For the fourth quarter revenue per available room checked in at $157.05, up 5.2 percent over the same time last year. That RevPAR number excludes the Park Central Hotel in New York, which LaSalle closed on in January 2012. Including the Park Central, RevPAR was up 3.3 percent for the quarter.