RLJ sold its owned 298-room Hilton Worldwide (HLT - Get Report) Garden Inn and the Hilton Fashion District hotel in New York City for $286 million. It also sold a 119-room "non-core" hotel in Bakersfield, CA, for $13 million, RLJ said in a statement Tuesday night.
"While we continue to believe in the New York City market over the long term, in the near term these sales reduce our exposure as this market goes through a soft period," CEO Ross Bierkan noted in the statement.
The $286 million New York City sales represent a 4.7% capitalization rate on RLJ's projected 2016 net operating income, including planned capital expenditures. The sales reduce the share of the company's pro forma full-year hotel earnings before interest, taxes, depreciation and amortization (EBITDA) from the New York City market to less than 5%, according to the company.
RLJ is headquartered in Bethesda, Md., and engages in the acquisition of focused-service and compact full-service hotels. The company owns 122 hotels with approximately 20,100 rooms in 21 U.S. states.