Eagle Hospitality Trust: City of Long Beach to conduct Queen Mary lease audit

U.S. one-dollar currency notes; taken September 2018.U.S. one-dollar currency notes; taken September 2018.

Eagle Hospitality Trust said Wednesday the City of Long Beach’s auditor would begin an audit of the Queen Mary lease agreement, marking the sixth time the office has conducted an audit.

“The City indicated that an outside review of financial statements is a normal practice of good lease management,” Eagle Hospitality Trust said in a filing to SGX.

The trust has previously said that its sponsor, Urban Commons, and the REIT have complied with the ground lease with the City of Long Beach, California, and are not in default on the Queen Mary property. The Queen Mary is a decommissioned ocean liner which has been converted into an upscale hotel and attraction moored in Long Beach.

“The previous five audits were conducted while the Queen Mary was managed by a different operator; i.e. before Urban Common’s involvement,” the filing said. “The upcoming audit relates to calendar years 2017 and 2018, a period before EH-REIT owned the leasehold interest of the Queen Mary.”

The REIT said all business operations will proceed as usual.