Pebblebrook Hotel Trust announced the successful completion of the sale of the Westin Michigan Avenue Chicago for $72.0 million to a third party.
The sale resulted in earnings before interest, taxes, depreciation, and amortization (EBITDA) of $4.6 million and net operating income (NOI) of $2.5 million for the trailing twelve months ended September 30, 2025.
The company intends to use the sale proceeds for general corporate purposes, debt reduction, preferred equity repayment, and common shares repurchase.
Sale Details
Sold Westin Michigan Avenue Chicago for $72.0 million, resulting in a 15.6x EBITDA multiple and a 3.5% NOI capitalization rate.
Debt Reduction
Reduced outstanding debt by $100 million and preferred securities outstanding by approximately $5 million.
Updated Outlook
Revised 2025 outlook after the property sales with largely unchanged key earnings metrics.
- The sale of The Westin Michigan Avenue Chicago and Montrose at Beverly Hills has positively impacted Pebblebrook's balance sheet by reducing outstanding debt and preferred equity, improving net debt to trailing 12-month corporate EBITDA ratio to approximately 5.9x.
- The company's revised 2025 outlook indicates stable performance despite the sold properties being removed from Q4 2025 metrics, with lower interest expenses offsetting the loss of hotel-level EBITDA.
Pebblebrook's strategic property sales have strengthened its financial position and provided resources for debt reduction and shareholder value enhancement. The company's adjusted outlook reflects resilience and stability in its operations post-sale.