Form 8-K - Current report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported): December 21, 2023

PEBBLEBROOK HOTEL TRUST

(Exact name of registrant as specified in its charter)

Maryland

001-34571

27-1055421

(State or other jurisdiction

(Commission

(I.R.S. Employer

of incorporation)

File Number)

Identification No.)



4747 Bethesda Avenue, Suite 1100, Bethesda, Maryland									20814
(Address of principal executive offices)									(Zip Code)

Registrant’s telephone number, including area code: (240) 507-1300


Not Applicable
Former name or former address, if changed since last report

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Shares, $0.01 par value per share

PEB

New York Stock Exchange

Series E Cumulative Redeemable Preferred Shares, $0.01 par value

PEB-PE

New York Stock Exchange

Series F Cumulative Redeemable Preferred Shares, $0.01 par value

PEB-PF

New York Stock Exchange

Series G Cumulative Redeemable Preferred Shares, $0.01 par value

PEB-PG

New York Stock Exchange

Series H Cumulative Redeemable Preferred Shares, $0.01 par value

PEB-PH

New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 7.01. Regulation FD Disclosure.

Pebblebrook Hotel Trust (the "Company") issued a press release on December 22, 2023, announcing that on December 21, 2023, it closed on the sale of the Marina City retail space and two parking facilities adjacent to its Hotel Chicago Downtown, Autograph Collection, located in Chicago, IL, for $30 million to a third party.

A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K and is hereby incorporated by reference herein.

Item 8.01. Other Events.

On December 21, 2023, the Company closed on the sale of the Marina City retail space and two parking facilities adjacent to its Hotel Chicago Downtown, Autograph Collection, located in Chicago, IL, for $30 million to a third party. Proceeds from the sale will be used for general corporate purposes, which may include reducing the Company's outstanding debt and repurchasing the Company's common and preferred shares.

Forward-Looking Statements

This Current Report on Form 8-K contains certain “forward-looking statements” made pursuant to the safe harbor provisions of the Private Securities Reform Act of 1995. Forward-looking statements are generally identifiable by the use of forward-looking terminology such as “estimated” and “will” or other similar words or expressions. Forward-looking statements are based on certain assumptions and can include future expectations, future plans and strategies, financial and operating projections and forecasts and other forward-looking information and estimates. The intended use of proceeds is a forward-looking statement. These forward-looking statements are subject to various risks and uncertainties, many of which are beyond the Company’s control, which could cause actual results to differ materially from such statements. These risks and uncertainties include, but are not limited to, the state of the U.S. economy, the operating performance of our hotels and the supply of hotel properties, and other factors as are described in greater detail in the Company’s filings with the Securities and Exchange Commission, including, without limitation, the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. Unless legally required, the Company disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits


Exhibit No.						Description
99.1						Press release, issued December 22, 2023, announcing the sale of Marina City Retail Space and Parking Facilities in Downtown Chicago
104						Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.


	PEBBLEBROOK HOTEL TRUST

December 22, 2023	By:	/s/ Raymond D. Martz
		Name:	Raymond D. Martz
		Title:	Co-President, Chief Financial Officer, Treasurer and Secretary

Exhibit 99.1

4747 Bethesda Avenue, Suite 1100, Bethesda, MD 20814

T: (240) 507-1300, F: (240) 396-5626

www.pebblebrookhotels.com

News Release

Pebblebrook Hotel Trust Completes $30.0 Million Sale of Marina City Retail Space

and Parking Facilities in Downtown Chicago

Bethesda, MD, December 22, 2023 – Pebblebrook Hotel Trust (NYSE: PEB) (the “Company”) announced today that on December 21, 2023, it successfully completed the sale of the Marina City retail space and two parking facilities adjacent to its Hotel Chicago Downtown, Autograph Collection, for $30.0 million to a third party.

The sales transaction includes approximately 146,000 square feet of retail space and two parking facilities offering 900 spaces. The transaction reflects an approximate 6.4% capitalization rate based on the estimated net operating income for the year ending December 31, 2023.

Highlighting a year of robust activity in property dispositions, Pebblebrook has successfully executed seven property sales totaling $330.8 million in 2023. These sales cumulatively represent an approximate 20.6x EBITDA multiple and a 4.1% net operating income capitalization rate. This rate is calculated assuming a 4.0% capital reserve against total property revenues based on the trailing twelve-month performance preceding each sale.

Proceeds from the sale will be used for general corporate purposes, which may include reducing the Company’s outstanding debt and repurchasing the Company’s common and preferred shares.

About Pebblebrook Hotel Trust

Pebblebrook Hotel Trust (NYSE: PEB) is a publicly traded real estate investment trust (“REIT”) and the largest owner of urban and resort lifestyle hotels in the United States. The Company owns 46 hotels, totaling approximately 12,000 guest rooms across 13 urban and resort markets. For more information, visit www.pebblebrookhotels.com and follow us at @PebblebrookPEB.

This press release contains certain “forward-looking statements” made pursuant to the safe harbor provisions of the Private Securities Reform Act of 1995. Forward-looking statements are generally identifiable by the use of forward-looking terminology such as “estimated” and “will” or other similar words or expressions. Forward-looking statements are based on certain assumptions and can include future expectations, future plans and strategies, financial and operating projections and forecasts and other forward-looking information and estimates. The intended use of proceeds is a forward-looking statement. These forward-looking statements are subject to various risks and uncertainties, many of which are beyond the Company’s control, which could cause actual results to differ materially from such statements. These risks and uncertainties include, but are not limited to, the state of the U.S. economy, the operating performance of our hotels and the supply of hotel properties, and other factors as are described in greater detail in the Company’s filings with the Securities and Exchange Commission, including, without limitation, the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. Unless legally required, the Company disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.

For further information about the Company’s business and financial results, please refer to the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” sections of the Company’s SEC filings, including, but not limited to, its Annual Report on Form 10-K and Quarterly Reports on Form 10-Q, copies of which may be obtained at the Investor Relations section of the Company’s website at www.pebblebrookhotels.com.

All information in this press release is as of December 22, 2023. The Company undertakes no duty to update the statements in this press release to conform the statements to actual results or changes in the Company’s expectations.

###

Contacts:

Raymond D. Martz, Co-President and Chief Financial Officer, Pebblebrook Hotel Trust - (240) 507-1330

For additional information or to receive press releases via email, please visit our website at

www.pebblebrookhotels.com


Pebblebrook Hotel Trust
Marina City Retail Space
Reconciliation of Hotel Net Income to Hotel EBITDA and Hotel Net Operating Income
Estimated December 2023 Trailing Twelve Months
(Unaudited, in millions)

			Estimated
			Twelve Months Ended
			December 31,
			2023

Hotel net income (loss)			$1.4

Adjustment:
Depreciation and amortization			0.8

Hotel EBITDA			$2.2

Adjustment:
Capital reserve			(0.3)

Hotel Net Operating Income			$1.9


This press release includes certain non-GAAP financial measures as defined under Securities and Exchange Commission (SEC) rules. These measures are not in accordance with, or an alternative to, measures prepared in accordance with U.S. generally accepted accounting principles, or GAAP, and may be different from non-GAAP measures used by other companies. In addition, these non-GAAP measures are not based on any comprehensive set of accounting rules or principles. Non-GAAP measures have limitations in that they do not reflect all of the amounts associated with the hotel’s results of operations determined in accordance with GAAP. The Company has presented estimated trailing twelve-month hotel EBITDA, estimated trailing twelve-month hotel net operating income after capital reserves, and an estimated adjustment for the impact of a one-time real estate tax true up credit because it believes these measures provide investors and analysts with an understanding of the hotel-level operating performance. These non-GAAP measures do not represent amounts available for management’s discretionary use, because of needed capital replacement or expansion, debt service obligations or other commitments and uncertainties, nor are they indicative of funds available to fund the Company’s cash needs, including its ability to make distributions. The Company’s presentation of the hotel’s estimated trailing twelve-month EBITDA, estimated trailing twelve-month net operating income after capital reserves and an estimated adjustment for the impact of a one-time real estate tax true up credit should not be considered as an alternative to net income (computed in accordance with GAAP) as an indicator of the hotel’s financial performance. The table above is a reconciliation of the hotel’s estimated trailing twelve-month EBITDA and net operating income after capital reserves calculations to net income in accordance with GAAP. Any differences are a result of rounding.


Pebblebrook Hotel Trust
Historical Operating Data
($ in millions, except ADR and RevPAR)
(Unaudited)

Historical Operating Data:
	First Quarter		Second Quarter		Third Quarter		Fourth Quarter		Full Year
	2019		2019		2019		2019		2019

Occupancy	74	%	86	%	86	%	77	%	81	%
ADR	$251		$275		$272		$250		$263
RevPAR	$186		$236		$234		$192		$212

Hotel Revenues	$294.3		$375.5		$372.5		$318.8		$1,361.0
Hotel EBITDA	$74.2		$132.7		$126.5		$84.9		$418.3
Hotel EBITDA Margin	25.2	%	35.3	%	34.0	%	26.6	%	30.7	%

	First Quarter		Second Quarter		Third Quarter		Fourth Quarter		Full Year
	2022		2022		2022		2022		2022

Occupancy	49	%	69	%	73	%	61	%	63	%
ADR	$301		$324		$326		$297		$314
RevPAR	$146		$224		$238		$180		$197

Hotel Revenues	$229.3		$361.8		$382.8		$304.5		$1,278.4
Hotel EBITDA	$46.7		$124.5		$121.9		$63.1		$356.3
Hotel EBITDA Margin	20.4	%	34.4	%	31.8	%	20.7	%	27.9	%

	First Quarter		Second Quarter		Third Quarter
	2023		2023		2023

Occupancy	59	%	73	%	75	%
ADR	$303		$312		$312
RevPAR	$177		$229		$235

Hotel Revenues	$290.2		$372.1		$383.0
Hotel EBITDA	$59.1		$110.5		$111.9
Hotel EBITDA Margin	20.4	%	29.7	%	29.2	%

These historical hotel operating results include information for all of the hotels the Company owned as of December 21, 2023, (excluding LaPlaya Beach Club & Resort), following the sale of Marina City Retail Space. These historical operating results include periods prior to the Company's ownership of the hotels. The information above does not reflect the Company's corporate general and administrative expense, interest expense, property acquisition costs, depreciation and amortization, taxes and other expenses. Any differences are a result of rounding. The information above has not been audited and has been presented only for comparison purposes.

Document and Entity Information Document	Dec. 21, 2023
Entity Information [Line Items]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Dec. 21, 2023
Entity Registrant Name	PEBBLEBROOK HOTEL TRUST
Entity Central Index Key	0001474098
Entity Incorporation, State or Country Code	MD
Entity File Number	001-34571
Entity Tax Identification Number	27-1055421
Entity Address, Address Line One	4747 Bethesda Avenue
Entity Address, Address Line Two	Suite 1100
Entity Address, City or Town	Bethesda
Entity Address, State or Province	MD
Entity Address, Postal Zip Code	20814
City Area Code	240
Local Phone Number	507-1300
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity Emerging Growth Company	false
Common Shares, $0.01 par value per share
Entity Information [Line Items]
Title of 12(b) Security	Common Shares, $0.01 par value per share
Trading Symbol	PEB
Security Exchange Name	NYSE
Series E Cumulative Redeemable Preferred Shares, $0.01 par value
Entity Information [Line Items]
Title of 12(b) Security	Series E Cumulative Redeemable Preferred Shares, $0.01 par value
Trading Symbol	PEB-PE
Security Exchange Name	NYSE
Series F Cumulative Redeemable Preferred Shares, $0.01 par value
Entity Information [Line Items]
Title of 12(b) Security	Series F Cumulative Redeemable Preferred Shares, $0.01 par value
Trading Symbol	PEB-PF
Security Exchange Name	NYSE
Series G Cumulative Redeemable Preferred Shares, $0.01 par value
Entity Information [Line Items]
Title of 12(b) Security	Series G Cumulative Redeemable Preferred Shares, $0.01 par value
Trading Symbol	PEB-PG
Security Exchange Name	NYSE
Series H Cumulative Redeemable Preferred Shares, $0.01 par value
Entity Information [Line Items]
Title of 12(b) Security	Series H Cumulative Redeemable Preferred Shares, $0.01 par value
Trading Symbol	PEB-PH
Security Exchange Name	NYSE