Pebblebrook Hotel Trust closed on the sale of the 236-room Hotel Spero in San Francisco for $71 million.
According to the Real Deal, the buyer is an affiliate of Memphis, Tennn.-based Fairwood Capital.
For the trailing twelve months ended June 30, the hotel’s net operating loss was $1.6 million, and its earnings before interest, taxes, depreciation or amortization was -$1.4 million. Based on the hotel’s operating performance for 2019, the $71 million sales price reflects a 9.1x EBITDA multiple and a 9.8 percent net operating income capitalization rate.
The net operating income (loss) for both periods mentioned is after an assumed annual capital reserve of 4 percent of total hotel revenues.
Proceeds from the sale of Hotel Spero will be used for general corporate purposes and reducing the company’s outstanding debt borrowings associated with recent hotel acquisitions, in accordance with the company’s investment strategy.
In July, Pebblebrook sold San Francisco's Marker Hotel for $77 million to Los Angeles-based, vertically integrated real estate investment firm Stockdale Capital Partners.