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 LaSalle Hotel Properties Reports Net Loss of $3.7 million
for 4th Qtr 2003; RevPAR Down 4.8% for the Year 
Hotel Operating Statistics

 
BETHESDA, Md., Feb 19, 2003 - LaSalle Hotel Properties (NYSE:LHO) today reported a decrease in comparable funds from operations ("FFO") of 19.5 percent to $33.5 million for the year ended December 31, 2002, from $41.6 million for the prior year. Comparable FFO for the year ended December 31, 2002, declined to $1.74 per diluted share/unit, representing a decrease of $0.46 or 20.9 percent as compared to $2.20 per diluted share/unit for the year ended December 31, 2001. Comparable FFO is defined as FFO before one-time items, including the purchase of LaSalle Hotel Lessee, Inc. ("LHL"), the transition expenses associated with becoming a self-managed Real Estate Investment Trust ("REIT"), and costs associated with terminating third-party tenant leases. 

For the year 2002 versus the previous year, room revenue per available room ("RevPAR") decreased 4.8 percent to $92.42. The average daily rate ("ADR") of $144.30 declined 3.4 percent from the prior year, while occupancy declined 1.4 percent to 64.0 percent. The Company's hotels generated $63.4 million of EBITDA for the year ended December 31, 2002 compared to $68.4 million for the prior year. 

"2002 was another challenging year for the lodging industry. While travel rebounded significantly in the first half of the year from the post September 11 impact, any further economic recovery or improvement in the travel or lodging industries was delayed by a stagnant economy, growing geopolitical risks and constant terrorism warnings," said Jon Bortz, Chairman and Chief Executive Officer of LaSalle Hotel Properties. "Despite these challenges, our drive-to resort oriented properties continued to perform well. In addition, our newly repositioned boutique hotels in Washington D.C., which is one of the strongest urban markets in the country, have been well received by the market and continue to improve in-line with our expectations." 

Declines in RevPAR and hotel EBITDA margins were major factors in the reduction of the Company's Comparable FFO from 2001. Portfolio-wide RevPAR declined 4.8 percent due to continued weakness in the economy and business travel. Property EBITDA margins declined 100 basis points ("bps") due primarily to increased hotel wages and benefits expenses, and increases in sales, marketing and general and administrative costs as a percentage of lower sales. 

Net loss applicable to common shareholders for the year ended December 31, 2002 was ($3.9) million, or a loss of ($0.21) per diluted share/unit, compared to net income of $3.8 million, or $0.21 per diluted share/unit for the prior year. In addition to the decline in RevPAR and margins, net income was negatively impacted $0.13 per share due to the contingent lease termination expense associated with the New Orleans and Dallas hotels. For 2002, the Company's Comparable EBITDA declined 9.3 percent to $57.1 million from $63.0 million the prior year. Comparable EBITDA is defined as earnings before interest, taxes, depreciation, amortization and one-time items, including the purchase of LHL, the transition expenses associated with becoming a self-managed REIT, and costs associated with terminating third-party tenant leases. 

In March 2002, the Company raised $99.8 million from its 10 1/4% Series-A Preferred Equity offering. The preferred equity raise significantly lowered the Company's debt and thereby strengthened LaSalle's balance sheet in addition to providing capital to complete the D.C. Boutique Collection repositioning program. The differential in the coupon rate versus the interest rate the Company pays on its line of credit contributed significantly to the decline in FFO, EBITDA and net income available to common shareholders. 

The renovation and repositioning of the final two properties in the D.C. Boutique Collection were completed in 2002. On September 23, the Company completed the renovation and repositioning of the upscale 82-room Hotel Madera along with the hotel's full-service 100-seat restaurant and bar, Firefly. Both the Madera and Firefly have received significant notoriety throughout the Washington D.C. region. On November 6, the stylish 178-room Hotel Helix opened. The total investment for the four hotels included in the D.C. Boutique Collection is approximately $75.0 million. 

"The completion of these hotels should position us well for what we expect will be a terrific year for the Washington D.C. hotel market. The opening of the new Washington Convention Center in March 2003, combined with the area's high barriers to entry continue to make the city one of the strongest lodging markets in the country," noted Mr. Bortz. 

During 2002, the Company invested approximately $34.0 million throughout its portfolio, including approximately $20.9 million for the redevelopments of the D.C. Boutique Collection. Major investments included approximately $3.5 million at the Holiday Inn on the Hill for guestroom and lobby refurbishments, which is part of an overall $6.5 million redevelopment program due to be completed by the end of the first quarter of 2003; approximately $1.6 million at San Diego Paradise Point Resort for the addition of five new bungalows and restaurant enhancements, and approximately $4.5 million to complete the balance of the renovations at the Topaz Hotel and Hotel Rouge. Since 1998, the Company has invested approximately $130.0 million or $29,000 per guestroom on repositioning, renovations and refurbishments. 

During the third quarter of 2002, the Company announced the reinstatement of a normal quarterly dividend of $0.21 per common share of beneficial interest. In addition, the Company announced that commencing in 2003, dividend distributions would be made on a monthly basis to its common shareholders of beneficial interest, in lieu of quarterly dividends. For 2002, the Company paid $0.44 in common dividends per share. Of the common and preferred dividends paid during 2002, 100.0 percent represented ordinary income for tax purposes. 

"We were pleased that despite the difficult operating environment, we were able to reinstate our dividend at a meaningful level," advised Mr. Bortz. "Furthermore, the Board's decision to switch to paying dividends monthly will benefit our shareholders who desire income consistently throughout the year and reconfirms our primary commitment to provide a reliable stream of income to our shareholders." 

As of year-end 2002, LaSalle Hotel Properties had total outstanding debt of approximately $270.8 million, including its $11.9 million portion of the joint venture debt related to the Chicago Marriott. This represents a reduction of approximately $77.5 million from the 2001 year-end debt balance. The Company's unsecured credit facility had $94.7 million outstanding as of December 31, 2002. Interest for the year, including capitalized interest and interest related to the joint venture debt and Discontinued Operations was approximately $17.0 million, resulting in a Comparable EBITDA to interest coverage ratio of approximately 3.4x and a debt to EBITDA ratio of 4.7x. 

"The Company's common stock generated a total return, including price appreciation and dividends, of 23% during the year, which far surpassed our peers as well as the overall stock market," noted Mr. Bortz. "We believe this is attributable to several factors including our highly focused strategy of investing in luxury and upscale hotels in high barrier to entry markets, our conservatively managed balance sheet, and our aggressive asset management efforts." 

Fourth Quarter Results 

For the fourth quarter 2002, LaSalle Hotel Properties reported a decrease in Comparable FFO of 30.0 percent to $5.4 million versus $7.7 million for fourth quarter 2001. On a per diluted share/unit basis, fourth quarter 2002 Comparable FFO was $0.28 versus $0.40 for the prior year's quarter. 

RevPAR for the fourth quarter 2002 increased 5.8 percent compared with the prior year's quarter. ADR increased 0.3 percent from the prior year to $139.82 and occupancy improved 5.5 percent to 59.5 percent. 

"For the fourth quarter, our hotels located in drive-to resort markets, such as the Marriott Seaview Resort and Key West Beachside Resort, fared significantly better than our hotels located in convention markets, such as the New Orleans Grande Hotel and the Radisson Bloomington Convention Hotel," said Mr. Bortz. "Our hotels located in resort markets continue to experience solid demand from the leisure customer, despite the weak economy. Moreover, the gains experienced at these hotels were largely due to improvements in occupancy levels, which had been impacted following the events of September 11, 2001." 

During the fourth quarter, the Company's hotel EBITDA margins declined approximately 330 bps from the prior year quarter to 22.2 percent. The declines in margins were largely due to increases in wages and benefits expenses and administrative and general expenses. Rigorous cost cutting efforts and reduced service levels due to significant declines in occupancy following the events of September 11, 2001 could not be maintained. 

Comparable EBITDA declined by 13.1 percent to $10.4 million in the fourth quarter 2002 from $11.9 million in the same quarter of 2001. Net loss applicable to common shareholders for the fourth quarter 2002 was ($6.3) million, or ($0.34) per diluted share/unit, compared with a net loss of ($1.4) million, or ($0.07) per diluted share/unit, for the previous year. 

Subsequent Events 

Beginning in 2003, the Company switched to paying monthly dividends in lieu of quarterly dividends to its common shareholders of beneficial interest. On January 15, 2003, the Company announced the monthly dividend of $0.07 per share for each month of the first quarter, which equates to an annualized dividend of $0.84 per share. The January dividend was paid on February 14, 2003 to common shareholders of record on January 31, 2003. The February and March dividends will be paid on March 14 and April 15, 2003, respectively, to common shareholders of record on February 28 and March 31, 2003, respectively. 

The New Orleans Grande Hotel is currently under contract to be sold and, therefore, all results relating to this property have been reclassified as Discontinued Operations in the Company's financial statements. The sale of the hotel is anticipated to be completed during the second quarter of 2003. In conjunction with the sale of the New Orleans property, the Company will recognize an approximate $800,000 non-cash expense relating to the early disposition of debt associated with the hotel. 

The Company remains in litigation with Meridien Hotels, Inc. and related affiliates regarding the lease terminations at the Le Meridien Dallas and New Orleans hotels. In Dallas, the Company has an order in the District Court stating that Meridien has no lawful right of possession and the Company is in the midst of eviction proceedings. In New Orleans, the Louisiana Court of Appeals also ruled in favor of the Company. On December 20, Meridien abandoned the property and the Company retained Interstate Hotels & Resorts to operate the hotel as the New Orleans Grande Hotel. 

On December 19, 2002, the arbitration panel awarded to Meridien in connection with the New Orleans property a net unconfirmed award of approximately $5.4 million, subject to adjustment (reduction) by the courts. The Company is disputing the award, as well as whether Meridien is entitled to any payment due to their failure to vacate the property pursuant to the Company's termination of their lease to operate the hotel. 

After receiving additional favorable court rulings in Dallas and the unconfirmed arbitration award in New Orleans, the Company recognized a net $2.5 million contingent lease termination expense and reversed previously deferred assets and liabilities related to the termination of both the New Orleans property and Dallas property leases, and recorded a corresponding contingent liability. Based on the claims the Company has against Meridien, the Company is and will continue to seek reimbursement of legal fees and damages, and continue to challenge the propriety of the arbitration award, which may reduce any amounts owed Meridien, and therefore, ultimately any contingent lease termination expense. 

On January 28, 2003, LaSalle announced that Ms. Kelly L. Kuhn was appointed to the Company's Board of Trustees. Ms. Kuhn will also serve on the Company's Compensation Committee and Governance and Nominating Committee as an independent trustee. 

2003 Outlook

The Company believes the biggest challenges during 2003 relate to the negative impact of the continuing terrorism warnings and the geopolitical uncertainty surrounding the situation with Iraq on the economy and the travel and lodging industries in particular. Additionally, hotel profit margins are expected to be difficult to maintain due to continued rate pressure, wage and benefit increases, higher energy and insurance costs and increased property taxes. Although hotel supply growth is at one of the lowest levels over the last ten years, the Company believes industry-wide RevPAR will be flat to down 2.0 percent during 2003, with the upper upscale segment performing roughly in-line with the overall industry, assuming that there is no war with Iraq or additional terrorist attacks within the United States. 

"The growing possibility of military action in Iraq is certainly not positive for our industry and it is impacting all travel, especially corporate travel," said Jon Bortz. "In addition to shorter booking cycles, which we attribute to the growing concern related to these factors, we have seen a negative impact across all market segments including group bookings, convention attendance, and business and leisure transient reservations. If there is a war or additional acts of terror here in the United States, we would anticipate an incremental negative impact to what we are currently experiencing." 

The Company expects that its portfolio will outperform the industry in 2003 due to the recently renovated and repositioned hotels in the Washington D.C. region, the overall quality and location of the Company's hotels and the completion of the renovations at Holiday Inn on the Hill in Washington D.C. and the Hotel Viking in Newport, Rhode Island. Consequently, the Company expects RevPAR for the Company's portfolio to be flat to up two percent, assuming that there is no war or acts of terrorism in the United States. 

Based upon these RevPAR assumptions, the Company's FFO would be in the range of $29.0 million to $32.0 million or $1.50 to $1.65 per diluted share/unit. Corporate EBITDA would be in the range of $54.0 million to $57.0 million for 2003. Property expenses are expected to increase by approximately three percent, resulting in property EBITDA margin declines of between 50 and 100 bps from 2002 levels. Additionally, the Company anticipates increases greater than inflation in legal, accounting, directors and officers insurance, terrorism insurance and other corporate level expenses due to the current corporate environment. 

LaSalle has allocated approximately $28.0 million for capital investments throughout its portfolio in 2003, which includes approximately $4.8 million for the Hotel Viking meeting space renovation, guestroom upgrades and spa construction, $3.5 million for the Marriott LaGuardia guestroom and meeting room refurbishments and $3.0 million for the Holiday Inn on the Hill public area and guestroom renovation, which would complete the overall $6.5 million redevelopment. Additionally, approximately $4.0 million of property refurbishments are expected to be made at the Dallas hotel for conversion to a Westin and other upgrades and approximately $2.0 million invested for soft goods and bathroom renovations at the Key West Beachside Resort. 

Recently, a new SEC regulation was issued that disallowed the addition or subtraction of certain items from non-GAAP measurements. As a result, the Company will no longer provide comparable FFO or comparable EBITDA information in its earnings releases or future guidance. 

LaSalle Hotel Properties is a leading multi-tenant, multi-operator real estate investment trust ("REIT"), which owns 17 upscale and luxury full-service hotels, totaling approximately 5,800 guest rooms in 13 markets in 11 states and the District of Columbia. LaSalle Hotel Properties focuses on investing in upscale and luxury full-service hotels located in urban, resort and convention markets. The Company seeks to grow through strategic relationships with premier internationally recognized hotel operating companies including Marriott International, Inc., Hyatt Hotels Corporation, Starwood Hotels & Resorts Worldwide, Inc., Crestline Hotels & Resorts, Inc., Radisson Hotels International, Inc., Outrigger Lodging Services, Noble House Hotels & Resorts, Interstate Hotels Corporation, and the Kimpton Hotel & Restaurant Group, LLC. 
 
 

.
LASALLE HOTEL PROPERTIES
Consolidated Statements of Operations
(Dollars in thousands, except per share data)

                              (Unaudited)

                                           For the three months ended

                                                  December 31,

                                           --------------------------

                                             2002             2001

                                           ---------        ---------

Revenues:

 Hotel operating revenues:

    Room revenue                            $21,067          $15,310

    Food and beverage revenue                14,060            9,025

    Other operating department

     revenue                                  3,724            3,456

 Participating lease revenue                  4,398            6,127

 Interest income                                112              157

 Other income                                     2              628

                                           ---------        ---------

           Total revenues                    43,363           34,703

                                           ---------        ---------

Expenses:

 Hotel operating expenses:

    Room                                      6,036            4,106

    Food and beverage                        10,347            6,315

    Other direct                              1,859            1,501

    Other indirect                           11,786            7,742

 Depreciation and other amortization          8,891            7,337

 Real estate taxes, personal property

  taxes and insurance                         2,335            2,260

 Ground rent                                    724              368

 General and administrative                   1,845            1,831

 Interest                                     2,759            3,929

 Amortization of deferred financing

  costs                                         610              517

 Lease termination, advisory

  transition, subsidiary purchase

  and contingent lease termination

  expense                                     2,520                -

 Writedown of notes receivable                  158            1,172

 Other expenses                                   -                1

                                           ---------        ---------

           Total expenses                    49,870           37,079

                                           ---------        ---------

 Loss before income tax benefit,

  minority interest, equity in

  earnings of unconsolidated entities

  and discontinued operations                (6,507)          (2,376)

 Income tax benefit                           2,018            1,364

                                           ---------        ---------

 Loss before minority interest, equity

  in earnings of unconsolidated

  entities and discontinued

  operations                                 (4,489)          (1,012)

 Minority interest in LaSalle Hotel

  Operating Partnership, L.P.                   100               29

                                           ---------        ---------

 Loss before equity in earnings of

  unconsolidated entities and

  discontinued operations                    (4,389)            (983)

 Equity in earnings of unconsolidated

  entities:

 Equity in income of joint venture              212               67

                                           ---------        ---------

 Total equity in earnings of

  unconsolidated entities                       212               67

 Loss before discontinued operations         (4,177)            (916)

 Discontinued operations:

 Income (loss) from operations of

  property held for sale                        320             (479)

 Minority interest                               (9)              14

 Income tax benefit                              74                -

                                           ---------        ---------

 Net income (loss) from discontinued

  operations                                    385             (465)

 Net loss                                    (3,792)          (1,381)

 Distributions to preferred

  shareholders                               (2,557)               -

                                           ---------        ---------

 Net loss applicable to common

  shareholders                              $(6,349)         $(1,381)

                                           =========        =========

 Earnings per Common Share - Basic:

 Loss applicable to common shareholders

  before discontinued operations             $(0.36)          $(0.05)

 Discontinued operations                       0.02            (0.02)

                                           ---------        ---------

 Net loss applicable to common

  shareholders                               $(0.34)          $(0.07)

                                           =========        =========

 Earnings per Common Share - Diluted:

 Loss applicable to common shareholders

  before discontinued operations             $(0.36)          $(0.05)

 Discontinued operations                       0.02            (0.02)

                                           ---------        ---------

 Net loss applicable to common

  shareholders                               $(0.34)          $(0.07)

                                           =========        =========

 Weighted average number common shares

  outstanding:

 Basic                                   18,706,812       18,594,653

 Diluted                                 18,840,349       18,623,105

                       LASALLE HOTEL PROPERTIES

                 Comparable FFO and Comparable EBITDA

             (Dollars in thousands, except per share data)

                              (Unaudited)

                                           For the three months ended

                                                  December 31,

                                           --------------------------

                                             2002             2001

                                           ---------        ---------

Comparable Funds From Operations

 (FFO):

Net loss applicable to common

 shareholders                               $(6,349)         $(1,381)

Depreciation                                  8,842            8,303

Equity in depreciation of joint

 venture                                        247              239

Amortization of deferred lease costs             46                7

Minority interest:

Minority interest in LaSalle Hotel

 Operating Partnership, L.P.                   (100)             (29)

Minority interest in discontinued

 operations                                       9              (14)

                                           ---------        ---------

FFO                                           2,695            7,125

Lease termination and contingent lease

 termination expense                          2,520                -

Writedown of notes receivable                   158            1,172

Lease termination income                          -             (621)

                                           ---------        ---------

Comparable FFO                               $5,373           $7,676

                                           =========        =========

Comparable FFO per common share and

 unit:

 Basic                                        $0.28            $0.40

 Diluted                                      $0.28            $0.40

Weighted average number of common

 shares and units outstanding:

 Basic                                   19,131,498       19,037,836

 Diluted                                 19,265,035       19,066,288

Comparable EBITDA:

Net loss applicable to common

 shareholders                               $(6,349)         $(1,381)

Interest                                      3,728            4,908

Equity in interest expense of joint

 venture                                        155              157

Income tax benefit:

 Income tax benefit                          (2,018)          (1,364)

 Income tax benefit from discontinued

  operations                                    (74)               -

Depreciation and other amortization           8,888            8,319

Equity in depreciation/amortization of

 joint venture                                  274              254

Amortization of deferred financing

 costs                                          637              544

Minority interest:

 Minority interest in LaSalle Hotel

  Operating Partnership, L.P.                  (100)             (29)

 Minority interest in discontinued

  operations                                      9              (14)

Distributions to preferred

 shareholders                                 2,557                -

                                           ---------        ---------

EBITDA                                        7,707           11,394

Lease termination and contingent lease

 termination expense                          2,520                -

Writedown of notes receivable                   158            1,172

Lease termination income                          -             (621)

                                           ---------        ---------

Comparable EBITDA                           $10,385          $11,945

                                           =========        =========

                       LASALLE HOTEL PROPERTIES

                 Consolidated Statements of Operations

             (Dollars in thousands, except per share data)

                              (Unaudited)

                                   For the year ended December 31,

                                    -----------------------------

                                        2002              2001

                                    -----------       -----------

 Revenues:

  Hotel operating revenues:

        Room revenue                   $92,461           $70,875

        Food and beverage

         revenue                        49,508            34,845

        Other operating

         department revenue             14,006            12,876

  Participating lease

   revenue                              21,909            35,123

  Interest income                          340               704

  Other income                              19               885

                                    -----------       -----------

        Total revenues                 178,243           155,308

                                    -----------       -----------

 Expenses:

  Hotel operating expenses:

        Room                            23,700            17,058

        Food and beverage               36,184            25,681

        Other direct                     7,249             6,805

        Other indirect                  45,766            33,846

  Depreciation and other

   amortization                         31,230            27,514

  Real estate taxes, personal

   property taxes and insurance          8,842             8,775

  Ground rent                            3,209             3,279

  General and administrative             6,444             6,376

  Interest                              11,474            17,106

  Amortization of deferred

   financing costs                       2,288             1,879

  Writedown of property

   held for sale                             -             1,872

  Lease termination, advisory

   transition, subsidiary

   purchase and contingent

   lease termination expense             2,520             1,929

  Writedown of notes

   receivable                              158             1,172

  Other expenses                             7                 4

                                    -----------       -----------

        Total expenses                 179,071           153,296

                                    -----------       -----------

 Income (loss) before income tax

  benefit, minority interest,

  equity in earnings of

  unconsolidated entities,

  discontinued operations and

  extraordinary loss                      (828)            2,012

 Income tax benefit                      2,943             1,507

                                    -----------       -----------

 Income before minority interest,

  equity in earnings of

  unconsolidated entities,

  discontinued operations and

  extraordinary loss                     2,115             3,519

 Minority interest in LaSalle

  Hotel Operating Partnership,

  L.P.                                     (58)             (108)

                                    -----------       -----------

 Income before equity in

  earnings of unconsolidated

  entities, discontinued

  operations and extraordinary

  loss                                  2,057             3,411

 Equity in earnings of

  unconsolidated entities:

  Equity in income of joint

   venture                                 458               616

                                    -----------       -----------

  Total equity in earnings of

   unconsolidated entities                 458               616

 Income before discontinued

  operations and extraordinary

  loss                                   2,515             4,027

 Discontinued operations:

  Income from operations of

   property held for sale                1,928               776

  Minority interest                        (46)              (20)

  Income tax benefit                        74                 -

                                    -----------       -----------

  Net income from

   discontinued operations               1,956               756

 Income before

  extraordinary loss                     4,471             4,783

 Extraordinary loss:

  Extraordinary loss                         -              (973)

  Minority interest                          -                25

                                    -----------       -----------

  Net extraordinary loss                     -              (948)

 Net income                              4,471             3,835

 Distributions to preferred

  shareholders                          (8,410)                -

                                    -----------       -----------

 Net income (loss) applicable to

  common shareholders                  $(3,939)           $3,835

                                    ===========       ===========

 Earnings per Common Share

  - Basic:

  Income (loss) applicable to

   common shareholders before

   discontinued operations and

   extraordinary loss                   $(0.31)            $0.22

  Discontinued operations                 0.10              0.04

  Extraordinary loss                         -             (0.05)

                                    -----------       -----------

  Net income (loss) applicable

   to common shareholders               $(0.21)            $0.21

                                    ===========       ===========

 Earnings per Common Share

  - Diluted:

  Income (loss) applicable to

   common shareholders before

   discontinued operations and

   extraordinary loss                   $(0.31)            $0.22

  Discontinued operations                 0.10              0.04

  Extraordinary loss                         -             (0.05)

                                    -----------       -----------

  Net income (loss) applicable

   to common shareholders               $(0.21)            $0.21

                                    ===========       ===========

 Weighted average number common

  shares outstanding:

  Basic                             18,689,184        18,385,015

  Diluted                           18,843,530        18,452,882

                       LASALLE HOTEL PROPERTIES

                 Comparable FFO and Comparable EBITDA

             (Dollars in thousands, except per share data)

                              (Unaudited)

                                      For the year ended December 31,

                                       -----------------------------

                                           2002              2001

                                       -----------       -----------

 Comparable Funds From Operations

  (FFO):

 Net income (loss) applicable to

  common shareholders                     $(3,939)           $3,835

 Depreciation                              33,425            31,354

 Equity in depreciation of joint

  venture                                     974               938

 Amortization of deferred lease

  costs                                        71                38

 Writedown of property held for

  sale                                          -             1,872

 Minority interest:

  Minority interest in LaSalle Hotel

   Operating Partnership, L.P.                 58               108

  Minority interest in discontinued

   operations                                  46                20

  Minority interest in

   extraordinary loss                           -               (25)

 Extraordinary loss                             -               973

 Equity in extraordinary loss of

  joint venture                               150                 -

                                       -----------       -----------

  FFO                                      30,785            39,113

  Advisory transition expense                   -               600

  Lease termination and contingent

   lease termination expense                2,520               796

  Subsidiary purchase cost                      -               533

  Writedown of notes receivable               158             1,172

  Lease termination income                      -              (621)

                                       -----------       -----------

  Comparable FFO                          $33,463           $41,593

                                       ===========       ===========

 Comparable FFO per common share

  and unit:

  Basic                                     $1.75             $2.20

  Diluted                                   $1.74             $2.20

 Weighted average number of common

  shares and units outstanding:

  Basic                                19,125,374        18,877,666

  Diluted                              19,279,719        18,945,533

 Comparable EBITDA:

 Net income (loss) applicable to

  common shareholders                     $(3,939)           $3,835

 Interest                                  15,333            21,005

 Equity in interest expense of

  joint venture                               579               825

 Income tax benefit:

  Income tax benefit                       (2,943)           (1,507)

  Income tax benefit from

   discontinued operations                    (74)                -

 Depreciation and other

  amortization                             33,531            31,429

 Equity in depreciation/amortization

  of joint venture                          1,062               998

 Amortization of deferred

  financing costs                           2,398             1,992

 Writedown of property held for

  sale                                          -             1,872

 Minority interest:

  Minority interest in LaSalle Hotel

   Operating Partnership, L.P.                 58               108

  Minority interest in

   discontinued operations                     46                20

  Minority interest in

   extraordinary loss                           -               (25)

 Distributions to preferred

  shareholders                              8,410                 -

                                       -----------       -----------

  EBITDA                                   54,461            60,552

 Advisory transition expense                    -               600

 Lease termination and contingent

  lease termination expense                 2,520               796

 Subsidiary purchase cost                       -               533

 Writedown of notes receivable                158             1,172

 Lease termination income                       -              (621)

                                       -----------       -----------

  Comparable EBITDA                       $57,139           $63,032

                                       ===========       ===========

                       LASALLE HOTEL PROPERTIES

                    Statistical Data for the Hotels

                         For the Three Months      For the Year

                                 Ended                 Ended

                         -------------------- ---------------------

                          Dec. 31,    Dec. 31,   Dec. 31,   Dec. 31,

                              2002        2001       2002       2001

TOTAL PORTFOLIO

Occupancy                    59.5%       56.4%      64.0%      65.0%

     Increase/(Decrease)      5.5%                 (1.4%)

ADR                       $139.82     $139.40    $144.30    $149.40

     Increase/(Decrease)      0.3%                 (3.4%)

REVPAR                     $83.19      $78.59     $92.42     $97.04

     Increase/(Decrease)      5.8%                 (4.8%)

           Note:

           If a property was closed in either 2001 or 2002, its operating

    results are excluded for the corresponding months in both the 2001

    and 2002 reporting periods. Additionally, this schedule includes

    the operating data for the properties leased to third parties and

    the Company's 9.9% interest in The Chicago Marriott Downtown joint

    venture.

                       LASALLE HOTEL PROPERTIES

                        Hotel Operational Data

                  Schedule of Property Level Results

                       (unaudited, in thousands)

                          For the Three Months      For the Year

                                  Ended                 Ended

                          --------------------- ---------------------

                           December   December   December   December

                           31, 2002   31, 2001   31, 2002   31, 2001

Revenues

Room                         36,526     34,588    151,365    159,186

Food & beverage              20,654     18,137     70,592     69,930

Other                         4,930      5,457     20,278     22,517

                          ---------- ---------- ---------- ----------

Total hotel sales            62,110     58,182    242,235    251,633

Expenses

Room                          9,255      8,483     35,901     36,972

Food & beverage              14,246     12,685     50,461     51,676

Other direct                  2,680      2,677     10,192     10,628

General & administrative     15,172     13,602     56,463     57,801

Management fees               2,814      2,318      9,761     10,303

Fixed expenses                4,157      3,577     16,073     15,856

                          ---------- ---------- ---------- ----------

Total hotel expenses         48,325     43,343    178,852    183,235

EBITDA                       13,785     14,839     63,383     68,398

                          ========== ========== ========== ==========

           Note:

           If a property was closed in either 2001 or 2002, its operating

    results are excluded for the corresponding months in both the 2001

    and 2002 reporting periods. Additionally, this schedule includes

    the operating data for the properties leased to third parties and

    the Company's 9.9% interest in The Chicago Marriott Downtown joint

    venture.
Certain matters discussed in this press release may be deemed to be forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. 

 
Contact:
LaSalle Hotel Properties
Bethesda
Raymond Martz
301/941-1516
www.lasallehotels.com
Also See: LaSalle Hotel Properties Reports a Net Income of $4.4 million for Third Quarter; RevPAR Increased 1.4% / Hotel Operating Statistics / Oct 2002
LaSalle Hotel Properties Records Significant Increases in RevPAR, FFO, and EBITDA During 2000; Occupancy Grew  0.7% to 72.5% / Jan 2001


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