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LaSalle Acquires NYC'c Park Central Hotel, Will invest $35M in Upgrades

LaSalle Hotel Properties announced that it acquired The Park Central Hotel in New York City for $396.2 million. The 934-room, urban, full-service hotel is located on Seventh Avenue, between West 55th and West 56th Streets, in midtown Manhattan.

The transaction was funded with cash on hand, borrowings from the Company’s senior unsecured credit facility and issuance of 296,300 Operating Partnership Units valued at $27.00 per share. The Company received a $9.3 million reduction from the original purchase price in accordance with the terms of the purchase and sale agreement. The purchase price reduction is equal to the hotel’s income after debt service from September 2, 2011 through closing and is reflected in the $396.2 million purchase price.

“We are pleased to have finally closed on The Park Central Hotel,” says Michael D. Barnello, president and chief executive Officer of LaSalle Hotel Properties. “We remain excited about this well located New York City asset and our ability to acquire the hotel at an attractive purchase price.”

The hotel benefits from an excellent location, across the street from Carnegie Hall, three blocks south of Columbus Circle and Central Park, and five blocks from Rockefeller Center and Radio City Music Hall. The hotel is situated steps from midtown businesses and premium dining and is proximate to world renowned shopping and many of New York City’s preeminent tourist attractions. The hotel is just seven blocks north of Times Square and the theatre district.

The Park Central Hotel features two food and beverage outlets: Cityhouse, an 88-seat contemporary steakhouse, and Bar Bella, the hotel’s lobby lounge. The asset’s offerings also include 14,000 square feet of flexible meeting and function space, including an 8,500 square foot Grand Ballroom. Additionally, the property has 4,800 square feet of retail space.

Originally constructed in 1928, the hotel has undergone numerous renovations throughout the years, with over $33.0 million since 2004. The Company plans to implement a renovation of the hotel, currently estimated at between $30.0 and $35.0 million, including guestrooms and guest bathrooms, corridors and the hotel’s lobby. The renovation is expected to commence late 2012 and conclude during 2013.

LaSalle Hotel Properties is a leading multi-operator real estate investment trust owning 37 upscale full-service hotels, totaling over 9,800 guest rooms in 13 markets in 9 states and the District of Columbia. The Company focuses on owning, redeveloping and repositioning upscale full-service hotels located in urban, resort and convention markets.

LaSalle Hotel Properties seeks to grow through strategic relationships with premier lodging companies, including Westin Hotels and Resorts, Hilton Hotels Corporation, Outrigger Lodging Services, Noble House Hotels & Resorts, Hyatt Hotels Corporation, Benchmark Hospitality, White Lodging Services Corporation, Thompson Hotels, Sandcastle Resorts & Hotels, Davidson Hotel Company, Denihan Hospitality Group, the Kimpton Hotel & Restaurant Group, LLC, Accor, Destination Hotels & Resorts, HEI Hotels & Resorts, JRK Hotel Group, Inc., Viceroy Hotel Group and Highgate Holdings.
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