Pebblebrook Hotel Trust has acquired the 331-room Nines Hotel in Portland, Ore., for $127 million, or roughly $384,000 per key. The hotel is located across from Pioneer Square, in the heart of downtown. It will remain associated with Starwood’s Luxury Collection and operated by Sage Hospitality.
“We’re thrilled with our acquisition of The Nines Hotel and the opportunity to further expand our presence in the high-growth Portland market,” said Jon Bortz, chairman and CEO of Pebblebrook Hotel Trust. “This hotel represents our third hotel investment in Portland’s central business district, and the property’s desirable location across from Pioneer Square ideally places it near many of downtown Portland’s most notable demand generators. The hotel’s excellent downtown location and strong operating fundamentals, including its position as the market’s rate leader, make this acquisition an outstanding addition to our high-quality portfolio.”
The hotel is a short walk from Pioneer Place Mall, Saks Fifth Avenue, Nordstrom, Nike Town, the Pearl District and the numerous venues of the Portland Center for the Performing Arts.
The Nines opened in 2008 after a $133-million renovation of the former Meier & Frank Building. In 2013, The Nines Hotel operated at 88-percent occupancy, with an average daily rate of $193 and revenue per available room of $170.
In conjunction with the acquisition, the company is assuming three secured, non-recourse loans totaling $50.7 million, which are subject to a weighted average interest rate of 7.4 percent.
The Company expects to invest $6 to $8 million of capital to refresh the guestrooms and public areas, which it anticipates commencing in the fourth quarter of 2015.
The acquisition of The Nines Hotel brings the total number of properties in Pebblebrook’s portfolio to 31 and marks the company’s third investment in downtown Portland.