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Exhibit 8.1
[BAKER& HOSTETLER LLP LETTERHEAD]
February 18, 1998
Boykin Lodging Company
Terminal Tower, Suite 1500
50 Public Square
Cleveland, Ohio 44113
Ladies and Gentlemen:
We have acted as counsel to Boykin Lodging Company, an Ohio corporation
(the "Company"), in connection with the preparation of a registration statement
on Form S-11 (the "S-11 Registration Statement") filed with the Securities and
Exchange Commission (the "Commission") on June 19, 1996 (No. 333-6341), as
amended, with respect to the offering and sale (the "S-11 Offering") of
9,516,250 common shares, without par value, of the Company, the Company's
contribution of substantially all of the net proceeds of the S-11 Offering to
Boykin Hotel Properties, L.P., an Ohio limited partnership (the "Operating
Partnership"), in exchange for a general partnership interest in the Operating
Partnership and a note convertible into general partnership interests in the
Operating Partnership (the "Intercompany Convertible Note"). We have also acted
as Counsel to the Company in connection with the preparation of a registration
statement on Form S-3 (the "S-3 Registration Statement") filed with the
Commission on November 4, 1997 (No. 333-39369) with respect to the offering and
sale from time to time in one or more classes or series of (a) whole or
fractional preferred shares (collectively, "Preferred Shares"), (b) Preferred
Shares represented by depositary shares (the "Depositary Shares"), (c) common
shares, without par value and (d) warrants to purchase Preferred Shares,
Depositary Shares or common shares, without par value. Finally, we have also
acted as counsel to the Company in connection with the preparation under the S-3
Registration Statement of a Prospectus ("Prospectus") and Prospectus Supplement
("Supplement") (the Prospectus and the Supplement are hereafter collectively
referred to as the "Current Offering Materials") with respect to the offering
and sale (the "Offering") of up to 5,175,000 common shares, without par value,
of the Company. Any capitalized terms not specifically defined herein have the
meaning ascribed to them in the Current Offering Materials. You have requested
our opinion on certain federal income tax matters in connection with the
Offering.
The Operating Partnership has acquired equity interests in certain
hotels and certain associated personal property (the "Boykin Hotels"). In
addition, the Operating Partnership has acquired interests in certain limited
liability companies and limited partnerships described in the Current Offering
Materials that own and lease hotels and certain associated personal property
(these interests are referred to collectively as "Joint Ventures" and these
hotels are
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February 18, 1998
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referred to collectively as the "JV Hotels"). Finally, the Company entered into
an Agreement and Plan of Merger on December 30, 1997 (the "Proposed Merger")
with Red Lion Inns Limited Partnership ("Red Lion"), under which the Company
agreed to acquire a portfolio of 10 Doubletree licensed hotels owned by Red Lion
(the "Doubletree Hotels") (the Boykin Hotels, the JV Hotels and the Doubletree
Hotels are collectively referred to as the "Hotels"). The Hotels are leased to
various entities (the "Lessees"), pursuant to leases (the "Leases").
In connection with the opinions rendered below, we have examined the
following:
1. the Company's Amended and Restated Articles of Incorporation,
as filed with the Secretary of State of Ohio;
2. the Company's Code of Regulations;
3. the S-11 Registration Statement, the S-3 Registration
Statement and the Current Offering Materials;
4. the Amended and Restated Agreement of Limited Partnership of
the Operating Partnership (the "Operating Partnership Agreement");
5. the Leases;
6. the organizational and governing documents of the Joint
Ventures;
7. the Intercompany Convertible Note; and
8. such other documents as we have deemed necessary or appropriate for
purposes of this opinion.
In connection with the opinions rendered below, we have assumed
generally that:
1. each of the documents referred to above has been duly
authorized, executed, and delivered; is authentic, if an original, or is
accurate, if a copy; and has not been amended;
2. beginning with its initial taxable year ending December 31,
1996, the Company has operated and will continue to operate in the manner
described in the S-11 Registration Statement, the S-3 Registration Statement,
and the Current Offering Materials; and
3. the Company will not make any amendment to its organizational
documents, the Operating Partnership Agreement, or any Joint Venture document
after the date of this opinion that would adversely affect the Company's
qualification as a real estate investment trust (a "REIT") for any taxable year.
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Boykin Lodging Company
February 18, 1998
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In connection with the opinions rendered below, we also have relied
upon the correctness of the representations contained in the representation
letter executed by a duly appointed officer of the Company (the "Representation
Letter").
For purposes of our opinions, we made no independent investigation of
the facts contained in the documents and assumptions set forth above or the
representations set forth in the Representation Letter. No facts have come to
our attention, however, that would cause us to question the accuracy and
completeness of such facts or documents in a material way.
In addition, to the extent that any of the representations provided to
us in the Representation Letter are with respect to matters set forth in the
Internal Revenue Code of 1986, as amended (the "Code"), or the Treasury
regulations thereunder (the "Regulations"), we have reviewed with the
individuals making such representation the relevant portion of the Code and the
applicable Regulations and are reasonably satisfied that such individuals
understand such provisions and are capable of making such representations.
Based on the documents and assumptions set forth above, the
representations set forth in the Representation Letter, the discussion in the
S-11 Registration Statement and the S-3 Registration Statement under the caption
"Federal Income Tax Considerations" (including all assumptions and
qualifications set forth therein), and the discussion in the Supplement under
the caption "Certain Federal Income Tax Considerations" (all of which are
incorporated herein by reference), we are of the opinion that:
(a) the Company has qualified as a REIT for its short taxable
year ended December 31, 1996 and its taxable year ended December 31,
1997, and the Company's proposed method of operation, whether the
Proposed Merger occurs or not, will enable it to meet the requirements
for qualification and taxation as a REIT under the Code;
(b) the descriptions of the law and the legal conclusions
contained in the Prospectus under the caption "Federal Income Tax
Considerations" as such descriptions and conclusions are modified and
supplemented by the Supplement under the captions "Risk Factors--Tax
Risks" and "Certain Federal Income Tax Considerations" are correct in
all material respects, and the discussion contained therein fairly
summarizes the federal tax considerations that are material to a holder
of the Common Shares;
(c) the Operating Partnership has, since its formation, been
treated for federal income tax purposes as a partnership and not as an
association taxable as a corporation or as a publicly traded
partnership; and
(d) the Joint Ventures have, since their formation, for
federal income tax purposes been either (i) disregarded as separate
from their owner or (ii) treated as
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Boykin Lodging Company
February 18, 1998
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partnerships and not as associations taxable as corporations or as
publicly traded partnerships.
We will not review on a continuing basis the Company's compliance with the
documents or assumptions set forth above, or the representations set forth in
the Representation Letter. Accordingly, no assurance is given that the actual
results of the Company's operations for any particular taxable year will satisfy
the requirements for qualification and taxation as a REIT.
The foregoing opinions are based on current provisions of the Code and
the Regulations, published administrative interpretations thereof, and published
court decisions. The Internal Revenue Service has not issued Regulations or
administrative interpretations with respect to various provisions of the Code
relating to REIT qualification. No assurance is given that the law will not
change in a way that will prevent the Company from qualifying as a REIT or the
Operating Partnership and Joint Ventures from being classified as partnerships
for federal income tax purposes.
We hereby consent to the filing of this opinion as an exhibit to the
S-3 Registration Statement. We also consent to the references to Baker &
Hostetler LLP under the captions "Federal Income Tax Considerations" and "Legal
Matters" in the Prospectus and under the captions "Tax Risks" and "Legal
Matters" in the Supplement.
The foregoing opinions are limited to the federal income tax matters
addressed herein, and no other opinions are rendered with respect to other
federal tax matters or to any issues arising under the tax laws of any state or
locality. We undertake no obligation to update the opinions expressed herein
after the date of this letter. This opinion letter is solely for the information
and use of the addressee, and may not be relied upon for any purpose by any
other person without our express written consent.
Very truly yours,
/s/ Baker & Hostetler LLP