BETHESDA, Md. - Pebblebrook Hotel Trust (NYSE: NYSE:PEB), a real estate investment trust (REIT), announced its intention to offer $350 million in senior notes due in 2029 through a private placement, subject to market and other conditions. The notes are to be unsecured obligations of Pebblebrook Hotel, L.P. and its subsidiary, PEB Finance Corp.
The company stated that the proceeds from this offering would primarily be used to reduce its existing unsecured term loans, with at least $253 million allocated for this purpose. Any remaining funds, which could be up to $87.4 million, may be used to further pay down other unsecured term loans or for the repurchase of a portion of the company's convertible senior notes.
These senior notes and their guarantees will not be registered under the Securities Act of 1933, as amended, or any state securities laws, and will be available only to qualified institutional buyers in accordance with Rule 144A and to certain non-U.S. persons in offshore transactions under Regulation S.
The press release includes forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995, which involve risks and uncertainties that could cause actual results to differ materially from those projected. These statements relate to the offering of the notes, the anticipated use of proceeds, and the completion of the offering itself.
This initiative follows Pebblebrook Hotel Trust's strategy to manage its debt portfolio and strengthen its financial position. The REIT focuses on acquiring and investing in hotel properties in urban and coastal markets in the United States.
It is important to note that this press release is not an offer to sell or a solicitation of an offer to buy the notes or any other securities, and any sales will be conducted in jurisdictions where such an offer, solicitation, or sale would be lawful.
The information in this article is based on a press release statement from Pebblebrook Hotel Trust.
In other recent news, Pebblebrook Hotel Trust had a strong showing in the second quarter, surpassing expectations with increased revenue per available room (RevPAR) and hotel earnings before interest, taxes, depreciation, and amortization (EBITDA). The company's redeveloped properties have captured more market share, contributing to improved cash flows. Despite a cautious outlook on RevPAR growth in the latter half of the year due to a slowing average daily rate (ADR) and economic deceleration, Pebblebrook raised its 2024 outlook for key financial metrics and expects healthy revenue growth. The company also plans to invest $85-90 million in capital expenditures in 2023. With a strong balance sheet, featuring $110 million in cash and no significant debt maturities until October 2025, Pebblebrook is well-positioned for future growth. These developments are part of the company's recent performance and strategic planning.
InvestingPro Insights
Pebblebrook Hotel Trust (NYSE: PEB) has recently drawn attention with its announcement to offer $350 million in senior notes. In light of this development, several InvestingPro metrics and tips provide a deeper understanding of the company's financial health and market position.
InvestingPro Tips suggest that PEB's stock has experienced a significant return over the last week, with a 11.02% price total return, indicating a positive short-term investor sentiment. Additionally, the company has been consistent in maintaining dividend payments for 15 consecutive years, showcasing a commitment to shareholder returns despite the volatility in its stock price movements.
From a valuation standpoint, InvestingPro Data reveals that the company is trading at a low revenue valuation multiple, with a Price / Book ratio of just 0.63 as of the last twelve months ending Q2 2024. This could indicate that the stock is potentially undervalued relative to its assets. However, the negative P/E Ratio of -12.9 reflects that the company was not profitable over the last twelve months, which aligns with analysts' expectations that Pebblebrook will not be profitable this year.
Investors looking to delve further into Pebblebrook's financials and future outlook can find additional InvestingPro Tips at https://www.investing.com/pro/PEB, which include insights on the company's EBIT valuation multiple and other key performance indicators.
For those interested in Pebblebrook's market activity, the company's Market Cap stands at approximately $1.72 billion USD. The Revenue Growth for the last twelve months as of Q2 2024 was modest at 1.03%, while the Gross Profit Margin was 25.89%, indicating a stable operational efficiency.
As Pebblebrook Hotel Trust navigates its debt management strategy, these InvestingPro Insights offer investors relevant data points to consider. It's worth noting that there are over 7 additional InvestingPro Tips available, providing a comprehensive analysis for those evaluating the company's investment potential.
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