101 Bogart Street Commences Operations
LuxUrban Hotels Inc. (Nasdaq: LUXH) (or “the Company”), which utilizes an asset-light business model to lease entire hotels on a long-term basis and rent out hotel rooms in these properties in key major metropolitan cities, announced today that it has signed a 25-year Master Lease Agreement (MLA), inclusive of two five-year options, to operate the Condor Hotel in Williamsburg, Brooklyn (“Condor Hotel”). The Company also signed a 15-year MLA, inclusive of one five-year option, to operate the Trinity Hotel (“Trinity”) in Los Angeles, California.
The Company expects to commence operations at the Condor Hotel and Trinity on or about July 1, 2023. In total, these new properties will add 214 units to the Company’s growing portfolio of short-stay hotel rooms.
The Company also announced that effective May 1, 2023 it commenced operations at 101 Bogart Street, a 65-unit, mix-used, seven-story property in East Williamsburg-Bushwick, Brooklyn. 101 Bogart is in a growing, industrial / art-infused community of startups, entrepreneurs, and freelancers that includes a 170,000-square-foot state-of-the-art Netflix production facility.
“New York City is expected to welcome more than 60 million visitors in 2023 and approach pre-pandemic levels of tourism. With the opening of 101 Bogart we are currently operating six hotels in New York City and the expected addition of the Condor will add greater density and diversity to our largest market at an exciting time of growth and recovery,” said Brian Ferdinand, Chairman and CEO of LuxUrban Hotels. “Downtown Los Angeles offers a wide array of cultural, entertainment, and business activities and the region’s improving hospitality market reflects the abundance of opportunities that this bustling commercial and residential hub provides.”
The Condor Hotel, LuxUrban’s second property in Brooklyn, provides an inviting oasis for leisure and business travelers alike. There’s always something to do in Brooklyn – from museums, to parks, to restaurants and bars. The Condor offers guests upscale accommodations, thoughtful amenities, and modern décor at an affordable price.
The Trinity Hotel, which will operate under the “LuxUrban Ultra” brand, is a 179-room property opened in 1914 and was where the Los Angeles Philharmonic orchestra held its first concert in 1919. The property has undergone a complete renovation and is ready to open. Nearby attractions include the Grammy Museum, Museum of Contemporary Art, and Walt Disney Concert Hall.
Mr. Ferdinand continued, “We are in various stages of negotiation with the owners / operators of several select, high-quality properties in new and existing markets, and expect to announce additional closings imminently. Our previously announced debt extension and conversion agreements along with an improving cash flow outlook have positioned us to begin accelerating the pace at which we close these MLAs and commence operations at the associated properties.
“We are also beginning to realize the benefits of a maturing and increasingly efficient operating structure, an elevated industry profile, strong union relationships, and a reputation for quickly executing transactions of size, when necessary. Based on our current forecast, we expect to have approximately 2,000 short-term rental hotel rooms operational at the start of the third quarter of 2023, up from the 1,034 at March 31, 2023, and a significant increase from the 844 units operational at December 31, 2022.”
LuxUrban Hotels Inc.
LuxUrban Hotels Inc. utilizes an asset light business model to lease entire hotels on a long-term basis and rent out hotel rooms in the properties it leases to business and vacation travelers through the company’s online portal and third-party sales and distribution channels. The company currently manages a portfolio of hotel rooms in New York, Washington D.C., Miami Beach, New Orleans and Los Angeles. As of March 31, 2023, the company has 1,034 hotel rooms available for rent and seeks to rapidly build its portfolio on favorable economics through the acquisition of additional accommodations that were dislocated or are underutilized as a result of the pandemic and current economic conditions. In late 2021, the company commenced the process of winding down its legacy business of leasing and re-leasing multifamily residential units, as it pivoted toward its new strategy of leasing hotels. This transition has been substantially completed.
Forward Looking Statements
This press release contains forward-looking statements, including with respect to the anticipated success of the transactions contemplated by this press release, ability to commence operations on the terms and timing that the Company expects, expectations regarding New York City visitor growth, expectations regarding future leasing activity, expected units operational, and the Company’s ability to commercialize efficiently and profitably the properties it leases and will lease in the future. These forward-looking statements are subject to a number of risks, uncertainties and assumptions, including those set forth under the caption “Risk Factors” in our public filings with the SEC, including in Item 1A of our 10-K for the year ended December 31, 2022. Generally, such forward-looking information or forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or may contain statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "will continue", "will occur" or "will be achieved". Forward-looking information may relate to anticipated events or results including, but not limited to business strategy, leasing terms, high-level occupancy rates, and sales and growth plans. The financial projections provided herein are based on certain assumptions and existing and anticipated market, travel and public health conditions, all of which may change. The forward-looking information and forward-looking statements contained in this press release are made as of the date of this press release, and the Company does not undertake to update any forward-looking information and/or forward-looking statements that are contained or referenced herein, except in accordance with applicable securities laws.