Hotel Online Special Report
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LaSalle Hotel Properties Reports Decrease 
in YTD Third Quarter Occupancy of 1.9% / ADR Up 7.6%
Statistical Data for the Hotels
 
WASHINGTON, D.C., Oct. 29, 1998 -  LaSalle Hotel Properties (NYSE: LHO) reported an increase in funds from operations (FFO) of 40 percent to $11.9 million for the third quarter versus $8.5 million for pro forma third quarter 1997. On a per share/unit basis, the third quarter 1998 FFO was $0.65 versus pro forma 1997 third quarter FFO of $0.47, a 38 percent increase.

On a combined pro forma/actual basis for the first nine months 1998 versus pro forma 1997, FFO increased 27 percent to $31.1 million from $24.5 million. Per share/unit nine month pro forma/actual 1998 FFO of $1.69 represents a $0.35 or 26 percent increase over the pro forma 1997 nine month FFO per share/unit of $1.34.

"We are very pleased with the increased profitability of our overall portfolio." said Jon Bortz, President and CEO of LaSalle Hotel Properties. "We believe in these uncertain times that the market will reward companies with high quality assets, sound fiscal policies and favorable operating results."

For the third quarter of 1998, room revenue per available room (RevPAR) has increased 3.7 percent to $108.87 compared to $104.99 in the year earlier third quarter, excluding three hotels: the Radisson South in Bloomington, Minn., which was severely impacted by the Northwest Airlines strike, and the Le Meridien Dallas and the Radisson Hotel Tampa at Sabal Park which had significant renovations. For the total portfolio, the RevPAR in the third quarter 1998 was flat. Year-to-date 1998 versus 1997, RevPAR increased 5.6 percent to $95.07 versus $90.05.

"In the third quarter, we started and completed our renovation of the Le Meridien Dallas, substantially completed the renovation of the Le Meridien New Orleans and began a renovation at the Radisson Tampa," said Mr. Bortz.

"We continue to focus on improving our hotels with $30 million of renovations scheduled for completion by the end of 1999, including soon-to-begin renovations at the Marriott Seaview Resort near Atlantic City and the San Diego Paradise Point Resort."

Participating lease revenues for the third quarter of 1998 increased 61 percent over the pro forma third quarter of 1997 to $19.6 million. For the nine months of 1998, pro forma/actual lease revenues were $47.3 million, a 33 percent increase over the same period of 1997. Net income for the 1998 third quarter was up 29 percent to $5.3 million, or $0.35 per share (basic and diluted), from pro forma net income of $ 4.1 million, or $0.27 per share (basic and diluted), for the third quarter of 1997. For the nine months ended September 30, 1998, combined pro forma/actual net income was $15.3 million, or $1.01 per share, compared to pro forma net income of $ 11.5 million, or $0.76 per share, in the prior year period.

Since the Company had no significant operations until after the completion of its initial public offering on April 23, 1998, pro forma operating results are being presented as if the Company had completed its initial public offering, acquired its interest in its ten initial upscale and luxury full service hotels, and leased these hotels under participating leases as of January 1, 1997. The pro forma results are based upon available information and certain assumptions that management of the Company believes are reasonable. For the nine months ended September 30, 1998, operating results on a combined basis are presented as six months pro forma for the first two quarters and three months actual results for the third quarter.

The pro forma results are not necessarily indicative of what the actual results of operations would have been for the nine month period ended September 30, 1997 or the six month period ended June 30, 1998, had the Company completed the initial public offering and acquired the initial ten upscale and luxury hotels on the date indicated nor does it purport to represent the future results of operations of the Company. For the two hotels acquired during the second quarter of 1998, their operating results are being presented in the pro forma results as of the date of the completion of each respective acquisition.

On October 20, LaSalle Hotel Properties declared its regular third and fourth quarter dividends of $0.375 each. The dividends are payable on November 13, 1998 and January 15, 1999 to the shareholders of record at the close of business on October 30, 1998 and December 31, 1998, respectively. Based on the closing price on October 28, these dividends on an annualized basis represent a dividend yield of 13 percent. LaSalle Hotel Properties also recently announced the establishment of a Dividend Reinvestment Plan (DRIP) that will allow shareholders to reinvest dividends and purchase LaSalle Hotel Properties stock without any transaction costs. The plan will be available beginning with the fourth quarter 1998 dividend.
 

LaSalle Hotel Properties
Statistical Data for the Hotels
 
For the three months ended September 30,
For the nine months ended September 30,
 
1998
1997
1998
1997
Comparable Hotels (a)
   Occupancy 79.4% 78.5% 76.7% 75.8
   Increase 1.0% 1.2%
   ADR $137.18 $133.67 $138.18 $130.41
   Increase 2.6% 6.0%
   REVPAR $108.87 $104.99 $105.97 $98.85
   Increase 3.7% 7.2%
Non-Comparable Hotels (b)
   Occupancy 62.4% 76.0% 66.7% 3.4%
   Increase (17.9%) (9.1%)
   ADR $103.40 $96.22 $105.35 $95.44
   Increase 7.5% 10.4%
   REVPAR $64.49 $73.12 $70.31 $70.04
   Increase (11.8%) 0.4%
Total Portfolio
   Occupancy 74.1% 77.8% 73.6% 75.1%
   Increase (4.7%) (1.9%)
   ADR $128.42 $122.42 $129.09 $119.96
   Increase 4.9% 7.6%
   REVPAR $95.20 $95.19 $95.07 $90.05
   Increase 0.0% 5.6%

(a)  Includes Le Meridien New Orleans, Marriott Seaview, LaGuardia Marriott, Omaha Marriott, Holiday Inn Beachside, Holiday Inn Plaza Park, Le Montrose All Suite, San Diego Paradise Point and Harborside Hyatt.

(b)  Includes Le Meridien Dallas and Radisson Tampa which were under renovation in the third quarter of 1998 and Radisson South in Bloomington, MN, which was severly impacted by the Northwest Airlines strike in September 1998.

LaSalle Hotel Properties is a leading multi-tenant, multi-operator real estate investment trust (REIT) which owns 12 upscale and luxury full-service hotels, totaling 4,120 guest rooms in nine states. The company is focused on investing in upscale and luxury full-service hotels located primarily in major business and urban, resort and convention markets. LaSalle Hotel Properties seeks to grow through strategic relationships with premier internationally recognized hotel operating companies including Le Meridien Hotels Resorts, Marriott International, Inc., Radisson Resorts and Hyatt Hotels Corporation. The REIT serves as the exclusive vehicle for LaSalle Partners' hotel investment activities in the United States.

Founded in 1968, LaSalle Partners Incorporated (NYSE: LAP) is a leading vertically integrated global real estate services firm providing management services, corporate and financial services, and investment services for public and private institutions and other real estate owners and investors world wide.

Statements in this press release regarding, among other things, future financial results and performance, achievements, plans and objectives may be considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve known and unknown risks, uncertainties and other factors which may cause actual results, performance, achievements, plans and objectives of the Company to be materially different from those expressed or implied by such forward-looking statements.

Factors that could cause actual results to differ materially include those discussed under "Risk Factors" and elsewhere in the Company's prospectus filed as part of its registration statement (333-45647) and in other periodic reports filed with the Securities and Exchange Commission. Statements speak only as of the date of this release. The Company expressly disclaims any obligation or undertaking to update or revise any forward- looking statements contained herein to reflect any change in Company expectations or results, or any change in events.
 

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Contact:
Magnes Welsh 
of LaSalle Hotel Properties, 
312-228-2471
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Also See:
LaSalle Hotel Properties Acquires San Diego Princess Resort / June 1998
LaSalle Hotel Properties Acquires Boston's Harborside Hyatt Conference Center Hotel for $73.5 Million / June 1998 

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