Morgans to Sell Mondrian Los Angeles to Pebblebrook Affiliate

Morgans Hotel Group has signed an agreement to sell its 237-room Mondrian Los Angeles hotel for $137m to an affiliate of the Pebblebrook Hotel Trust.

Morgans is selling the hotel in order to cut debt and focus on the management of hotels rather than ownership.

Previously, Morgan agreed to sell the Royalton and Morgans hotels in New York for $140m.

The sale of Mondrian Los Angeles is expected to generate net proceeds of $40m after a portion of the money is used to retire outstanding mortgage debt, the company said.

Following the transaction, the property will continue to be operated by Morgans as part of a 20-year management agreement, with one ten-year extension option.

The transaction will be completed at the end of the second quarter of 2011.