Pebblebrook buys stake in six Manhattan hotels

Wed Jun 22, 2011 12:57pm EDT

* Denihan will continue to manage properties

* Shares flat at $20.35

NEW YORK, June 22 (Reuters) - Pebblebrook Hotel Trust (PEB.N) is buying a stake in six Manhattan boutique hotels as it lengthens a string of acquisitions announced since it sold shares in early April.

Affiliates of Denihan Hospitality Group, a private New York hotel concern, will retain a 51 percent stake in the Benjamin and Affinia-brand hotels, valued at $910 million.

Pebblebrook will pay $152 million and assume about $294 million in debt for its stake in the properties, which Denihan will continue to manage.

Denihan will use the proceeds to expand their brands beyond major cities like New York.

Including the Denihan properties, Pebblebrook has bought outright or purchased a stake in 20 hotels since its 2009 formation by lodging industry veteran Jon Bortz.

More recently, the trust issued stock at $21.60 per share and announced the purchase of such properties as the Westin Gaslamp Quarter from Starwood Hotels & Resorts (HOT.N) and the Mondrian Los Angeles, which is managed by Morgans Hotel Group (MHGC.O).

Pebblebrook's shares were up 2 cents at $20.39 on the New York Stock Exchange in early afternoon. (Reporting by Helen Chernikoff; editing by Matthew Lewis)

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