White Lodging to Sell Off Local Hotel Managment Contracts, Lay Off HQ Staff

December 6, 2017-White Lodging will no longer manage many of the hotels in northwest Indiana and several other states. According to a letter from Chairman and Founder Bruce White, “White Lodging has agreed to sell 82 non-strategic hotel management contracts to Interstate Hotels and Resorts.” The move will jettison control of nearly half the hotels in the White Lodging portfolio bringing the total current hotels under corporate umbrella from 169 down to 87 according to the statement. Employees at the hotels, which include the Fairfield, Courtyard and Residence Inns in Hammond as well as the Fairfield, Residence and Hampton in Merrillville, will be transitioned to the new management company, Interstate Hotels and Resorts. White Lodging Corporate offices will eliminate an undetermined number of positions. “This transaction will be bittersweet for the company as it is a compelling strategic opportunity but comes with the unfortunate need to eliminate a number of corporate positions as we go from operating 169 hotels to 87” White stated.

RLJ issued an announcement saying that White Lodging will continue to manage 9 of the companies holdings:

“This transaction will result in Interstate Hotels becoming our largest management company,” commented Ross H. Bierkan, President and Chief Executive Officer. “We value our long-standing relationship with White Lodging and thank them for their management of these assets. Interstate is an excellent operator and already manages 11 of our hotels. We are excited to expand our relationship with Interstate and look forward to the fresh perspective they will bring to these assets.”

RLJ had come under scrutiny recently as a major sharehold publicly questioned the performance of the Company. In a rare public statement, shareholder Land and Building Investments Management called on RLJ to “provide a strategic roadmap outlining how the Board expects to deliver value to shareholders” in a September 6, 2017 letter which was released to investors and the public.

White Lodging will continue to manage the Hilton Garden Inn in Merrillville. White operated the hotels under a managment agreement with property owners RLJ Lodging Trust and PIMCO. White Lodging says the companies portfolio will reach 100 hotels after completion of current construction contracts.

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