Rlj Lodging Trust · NYSE:RLJ
Rlj Lodging Trust — NAREIT Investor Presentation 2013
27 slides from Rlj Lodging Trust's conference presentation, November 2013
Slide 1: NAREIT Investor Presentation
NAREIT Investor Presentation November 2013
Slide 2: Investment Highlights
Investment Highlights • Seasoned management team with proven track record of success • Proven investment strategy focused on upscale focused-service and compact full-service hotels • Attractive platform with significant scale and high quality assets • Strong internal and external growth prospects, p
Slide 3: Demonstrated Track Record as a Public Company
Demonstrated Track Record as a Public Company RLJ has consistently met or exceeded its guidance, with 10 consecutive quarters of solid performance. Since going public, RLJ has: • Acquired 13 properties in key gateway markets totaling approximately $575 million (1) • Generated significant cumulative
Slide 4: Near Term Catalysts – More Reasons to Invest in RLJ
Near Term Catalysts – More Reasons to Invest in RLJ • Compelling relative valuation • Seven brand conversions completed; generating outsized returns • Two-year renovation plan is finished; 93 assets completed, including $25 million renovation of DoubleTree by Hilton Metropolitan New York City • Rece
Slide 5: Attractive Relative Valuation vs. Lodging REIT Peers
Attractive Relative Valuation vs. Lodging REIT Peers TEV/2013E EBITDA (1) TEV/2014E EBITDA (1) 21.0x 18.0x 18.4x 15.5x 17.4x 15.0x 14.5x 18.0x 16.4x 15.8x 15.7x 15.0x 13.8x 13.8x 13.6x 13.4x 13.4x 15.1x 15.0x 14.8x 14.7x 14.7x 14.4x 12.5x 12.4x 15.0x 13.1x 12.5x 11.8x 11.7x 12.0x 11.1x 12.0x 9.0x 9.
Slide 6: Attractive Relative Total Returns
Attractive Relative Total Returns Absolute and Relative Performance vs. Peers Stock Price as of Relative Relative Ticker 5/10/2011 11/8/2013 Total Returns to RMZ (%) to RLJ (%) RMZ 18.4% -- (28.1%) Public Lodging REITs CHSP $17.27 $22.62 47.9% 29.4% 1.4% RLJ $18.00 $24.11 46.5% 28.1% -- CLDT $17.07
Slide 7: Industry-Leading RevPAR Growth
Industry-Leading RevPAR Growth Year to date, RLJ has recorded industry-leading RevPAR growth • Solid pro forma RevPAR growth of 8.2% − Among the Company’s top six markets, the best performers were Houston and New York which experienced RevPAR growth of 17.0% and 16.4%, respectively Year to Date RevP
Slide 8: Experienced Management with Proven Track Record
Experienced Management with Proven Track Record Deep and experienced senior management team that has worked together for over ten years and has over 150 years of combined lodging and real estate experience • Strong platform with significant expertise in acquisitions, asset management and portfolio m
Slide 9: Proven Investment Strategy
Proven Investment Strategy Create shareholder value through prudent capital investments and aggressive asset management • Acquire premium branded focused-service and compact full-service hotels with Marriott, Hilton and Hyatt flags − Courtyard by Marriott, Hilton Garden Inn, Hyatt Place, Investment
Slide 10: Disciplined Investment Strategy
Disciplined Investment Strategy Continue to execute investment strategy in core urban markets • Purchase assets that represent a significant discount to replacement cost • Enter markets that exhibit multiple demand generators and dynamic growth • Leverage industry relationships to purchase off-marke
Slide 11: Strong Balance Sheet – Limited Near Term Debt Maturities
Strong Balance Sheet – Limited Near Term Debt Maturities RLJ continues to strengthen its balance sheet by increasing the number of unencumbered assets, reducing interest rates and staggering debt maturities • Refinanced approximately $565 million of higher priced mortgage debt in Q3 2013 − Reduced i
Slide 12: Value Add – Complex Renovations
Value Add – Complex Renovations In-house design and construction team with extensive experience navigating complex renovations • Dedicated design and construction team Brand Conversions Location Status perform thorough due diligence prior to Red Roof Inn → Fairfield Inn & Suites DC Complete any asse
Slide 13: Case Study – Fairfield Inn & Suites DC/Downtown
Case Study – Fairfield Inn & Suites DC/Downtown Key Acquisition Metrics Year built 1986 Room count 198 (196 before renovation) Purchase price $40.0M (~$204K / key) Key demand drivers • 34.0M sq. ft. of office space • Walking distance to major attractions • Close to Walter E Washington Convention Cen
Slide 14: Case Study – Hilton Garden Inn Los Angeles/Hollywood
Case Study – Hilton Garden Inn Los Angeles/Hollywood Key Acquisition Metrics Year built 1975 Room count 160 Purchase price $29.4M (~$184K / key) Key demand drivers •18.9M sq. ft. of office space • Entertainment hub • Hollywood tourism Renovation Upgrades Time frame October 2011- March 2012 Renovatio
Slide 15: Case Study – Hilton Garden Inn Pittsburgh University Place
Case Study – Hilton Garden Inn Pittsburgh University Place Key Acquisition Metrics Year built 1970 Room count 202 (198 before renovation) Purchase price $21.2M (~$107K / key) Key demand drivers • 3.4M sq. ft. of office space; University of Pittsburgh • Headquarters of major corporations including PN
Slide 16: Company Overview
Company Overview
Slide 17: Guiding Principles
Guiding Principles Continue to execute proven investment strategies Drive operating performance − Increase RevPAR premiums and operating margins through aggressive asset management and asset repositioning Prudent capital allocation − Continue to enhance portfolio quality through selective acquisit
Slide 18: Superior Focused-Service / Compact Full-Service Model
Superior Focused-Service / Compact Full-Service Model Target premium branded focused-service and compact full-service hotels J.D. Power & Associates 2012 North American Hotel Guest Satisfaction Guest Satisfaction Ranking Among… Rank Brand Strong Loyalty 1 Programs Extended Stay Chains 3 4 Worldwide
Slide 19: Geographic Diversification and Strong Market Presence
Geographic Diversification and Strong Market Presence RLJ owns 150 properties, 148 hotels with approximately 22,400 rooms and two planned conversions located in 23 states and the District of Columbia • Approximately 97% of the portfolio is Marriott, Hilton or Hyatt branded (1) • RLJ’s top 40 hotels
Slide 20: Strong Platform with Significant Scale
Strong Platform with Significant Scale RLJ is the 3rd largest lodging REIT and the largest REIT in the focused-service category • Scale and platform provide significant benefits Corporate Adjusted EBITDA (As Reported TTM as of September 2013) ($ in millions) $450 $1,410 $400 $360 $350 $305 $300 $289
Slide 21: Significant Growth Potential
Significant Growth Potential
Slide 22: Existing Portfolio Positioned for Outsized Growth
Existing Portfolio Positioned for Outsized Growth Strong growth embedded within existing portfolio • Acquired 36 assets for a total purchase price of approximately $1.5 billion over the past 43 months in core urban markets: Portfolio Mix Change – New York City, Washington D.C., Los Angeles, Boston,
Slide 23: Superior Asset Management Program
Superior Asset Management Program RLJ has a proven asset management platform that supports investment efforts • In-house operational expertise strengthens investment underwriting process • Asset management expertise promotes effective utilization of capital − Franchise requirements − Asset preservat
Slide 24: Attractive Focused-Service Acquisition Environment
Attractive Focused-Service Acquisition Environment More targets with less competition: RLJ benefits from both a large universe of acquisition targets and a limited universe of competing public buyers Domestic System-Wide Hotels by Brand Premium Branded Focused-Service – 5,598 Hotels Upper Upscale Fu
Slide 25: Disciplined Investment Strategy
Disciplined Investment Strategy Proven track record of completing attractive acquisitions • Focus on limited bid and off-market transactions • Leverage relationships with developers, owners, managers and lenders to access deals • Strong balance sheet provides a significant advantage • Continue to pu
Slide 26: Forward-Looking Statements
Forward-Looking Statements This presentation contains certain statements, other than purely historical information, including estimates, projections, statements relating to the Company’s business plans, objectives and expected operating results, and the assumptions upon which those statements are ba
Slide 27: Significant Growth Potential
Significant Growth Potential
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