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Maryland
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04-3262075
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(State or Other Jurisdiction of
Incorporation or Organization)
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(IRS Employer Identification No.)
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Two Newton Place, 255 Washington Street, Suite 300, Newton, Massachusetts
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02458
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(Address of Principal Executive Offices)
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(Zip Code)
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Page
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September 30,
|
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December 31,
|
||||
|
|
2017
|
|
2016
|
||||
ASSETS
|
|
|
|
|
||||
Real estate properties:
|
|
|
|
|
||||
Land
|
|
$
|
1,668,493
|
|
|
$
|
1,566,630
|
|
Buildings, improvements and equipment
|
|
7,719,367
|
|
|
7,156,759
|
|
||
Total real estate properties, gross
|
|
9,387,860
|
|
|
8,723,389
|
|
||
Accumulated depreciation
|
|
(2,719,738
|
)
|
|
(2,513,996
|
)
|
||
Total real estate properties, net
|
|
6,668,122
|
|
|
6,209,393
|
|
||
Cash and cash equivalents
|
|
14,489
|
|
|
10,896
|
|
||
Restricted cash (FF&E reserve escrow)
|
|
73,115
|
|
|
60,456
|
|
||
Due from related persons
|
|
75,231
|
|
|
65,332
|
|
||
Other assets, net
|
|
313,510
|
|
|
288,151
|
|
||
Total assets
|
|
$
|
7,144,467
|
|
|
$
|
6,634,228
|
|
|
|
|
|
|
||||
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
|
||||
Unsecured revolving credit facility
|
|
$
|
458,000
|
|
|
$
|
191,000
|
|
Unsecured term loan, net
|
|
398,920
|
|
|
398,421
|
|
||
Senior unsecured notes, net
|
|
3,163,865
|
|
|
2,565,908
|
|
||
Convertible senior unsecured notes
|
|
—
|
|
|
8,478
|
|
||
Security deposits
|
|
126,574
|
|
|
89,338
|
|
||
Accounts payable and other liabilities
|
|
160,144
|
|
|
188,053
|
|
||
Due to related persons
|
|
47,509
|
|
|
58,475
|
|
||
Dividends payable
|
|
—
|
|
|
5,166
|
|
||
Total liabilities
|
|
4,355,012
|
|
|
3,504,839
|
|
||
|
|
|
|
|
||||
Commitments and contingencies
|
|
|
|
|
||||
|
|
|
|
|
||||
Shareholders’ equity:
|
|
|
|
|
||||
Preferred shares of beneficial interest, no par value; 100,000,000 shares authorized:
|
|
|
|
|
||||
Series D preferred shares; 7 1/8% cumulative redeemable; zero and 11,600,000 shares issued and outstanding, respectively, aggregate liquidation preference of zero and $290,000, respectively
|
|
—
|
|
|
280,107
|
|
||
Common shares of beneficial interest, $.01 par value; 200,000,000 shares authorized; 164,349,141 and 164,268,199 shares issued and outstanding, respectively
|
|
1,643
|
|
|
1,643
|
|
||
Additional paid in capital
|
|
4,541,978
|
|
|
4,539,673
|
|
||
Cumulative net income
|
|
3,278,475
|
|
|
3,104,767
|
|
||
Cumulative other comprehensive income
|
|
59,801
|
|
|
39,583
|
|
||
Cumulative preferred distributions
|
|
(343,412
|
)
|
|
(341,977
|
)
|
||
Cumulative common distributions
|
|
(4,749,030
|
)
|
|
(4,494,407
|
)
|
||
Total shareholders’ equity
|
|
2,789,455
|
|
|
3,129,389
|
|
||
Total liabilities and shareholders’ equity
|
|
$
|
7,144,467
|
|
|
$
|
6,634,228
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
|
||||||||
Hotel operating revenues
|
|
$
|
495,550
|
|
|
$
|
464,981
|
|
|
$
|
1,392,995
|
|
|
$
|
1,334,656
|
|
Rental income
|
|
80,896
|
|
|
77,470
|
|
|
240,274
|
|
|
229,760
|
|
||||
FF&E reserve income
|
|
1,142
|
|
|
1,065
|
|
|
3,524
|
|
|
3,517
|
|
||||
Total revenues
|
|
577,588
|
|
|
543,516
|
|
|
1,636,793
|
|
|
1,567,933
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Expenses:
|
|
|
|
|
|
|
|
|
||||||||
Hotel operating expenses
|
|
343,274
|
|
|
322,012
|
|
|
965,546
|
|
|
923,239
|
|
||||
Depreciation and amortization
|
|
98,205
|
|
|
90,139
|
|
|
286,811
|
|
|
266,192
|
|
||||
General and administrative
|
|
13,404
|
|
|
37,739
|
|
|
76,097
|
|
|
91,127
|
|
||||
Acquisition related costs
|
|
—
|
|
|
156
|
|
|
—
|
|
|
885
|
|
||||
Total expenses
|
|
454,883
|
|
|
450,046
|
|
|
1,328,454
|
|
|
1,281,443
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Operating income
|
|
122,705
|
|
|
93,470
|
|
|
308,339
|
|
|
286,490
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Dividend income
|
|
626
|
|
|
626
|
|
|
1,878
|
|
|
1,375
|
|
||||
Interest income
|
|
211
|
|
|
89
|
|
|
590
|
|
|
227
|
|
||||
Interest expense (including amortization of debt issuance costs and debt discounts and premiums of $2,194 and $2,122 and $6,541 and $6,114, respectively)
|
|
(46,574
|
)
|
|
(41,280
|
)
|
|
(135,329
|
)
|
|
(124,564
|
)
|
||||
Loss on early extinguishment of debt
|
|
—
|
|
|
(158
|
)
|
|
—
|
|
|
(228
|
)
|
||||
Income before income taxes, equity in earnings of an investee and gain on sale of real estate
|
|
76,968
|
|
|
52,747
|
|
|
175,478
|
|
|
163,300
|
|
||||
Income tax expense
|
|
(619
|
)
|
|
(948
|
)
|
|
(1,761
|
)
|
|
(3,483
|
)
|
||||
Equity in earnings of an investee
|
|
31
|
|
|
13
|
|
|
533
|
|
|
107
|
|
||||
Income before gain on sale of real estate
|
|
76,380
|
|
|
51,812
|
|
|
174,250
|
|
|
159,924
|
|
||||
Gain on sale of real estate
|
|
9,348
|
|
|
—
|
|
|
9,348
|
|
|
—
|
|
||||
Net income
|
|
85,728
|
|
|
51,812
|
|
|
183,598
|
|
|
159,924
|
|
||||
Other comprehensive income:
|
|
|
|
|
|
|
|
|
||||||||
Unrealized gain on investment securities
|
|
7,273
|
|
|
14,032
|
|
|
19,923
|
|
|
51,253
|
|
||||
Equity interest in investee’s unrealized gains
|
|
116
|
|
|
80
|
|
|
295
|
|
|
175
|
|
||||
Other comprehensive income
|
|
7,389
|
|
|
14,112
|
|
|
20,218
|
|
|
51,428
|
|
||||
Comprehensive income
|
|
$
|
93,117
|
|
|
$
|
65,924
|
|
|
$
|
203,816
|
|
|
$
|
211,352
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net income
|
|
$
|
85,728
|
|
|
$
|
51,812
|
|
|
$
|
183,598
|
|
|
$
|
159,924
|
|
Preferred distributions
|
|
—
|
|
|
(5,166
|
)
|
|
(1,435
|
)
|
|
(15,498
|
)
|
||||
Excess of liquidation preference over carrying value of preferred shares redeemed
|
|
—
|
|
|
—
|
|
|
(9,893
|
)
|
|
—
|
|
||||
Net income available for common shareholders
|
|
$
|
85,728
|
|
|
$
|
46,646
|
|
|
$
|
172,270
|
|
|
$
|
144,426
|
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average common shares outstanding (basic)
|
|
164,149
|
|
|
157,217
|
|
|
164,131
|
|
|
153,357
|
|
||||
Weighted average common shares outstanding (diluted)
|
|
164,188
|
|
|
157,263
|
|
|
164,168
|
|
|
153,390
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Net income available for common shareholders per common share (basic and diluted)
|
|
$
|
0.52
|
|
|
$
|
0.30
|
|
|
$
|
1.05
|
|
|
$
|
0.94
|
|
|
|
For the Nine Months Ended September 30,
|
||||||
|
|
2017
|
|
2016
|
||||
Cash flows from operating activities:
|
|
|
|
|
|
|||
Net income
|
|
$
|
183,598
|
|
|
$
|
159,924
|
|
Adjustments to reconcile net income to cash provided by operating activities:
|
|
|
|
|
|
|
||
Depreciation and amortization
|
|
286,811
|
|
|
266,192
|
|
||
Amortization of debt issuance costs and debt discounts and premiums as interest
|
|
6,541
|
|
|
6,114
|
|
||
Straight line rental income
|
|
(9,208
|
)
|
|
(10,377
|
)
|
||
Security deposits received or replenished
|
|
37,239
|
|
|
34,945
|
|
||
FF&E reserve income and deposits
|
|
(56,936
|
)
|
|
(57,890
|
)
|
||
Loss on early extinguishment of debt
|
|
—
|
|
|
228
|
|
||
Equity in earnings of an investee
|
|
(533
|
)
|
|
(107
|
)
|
||
Gain on sale of real estate
|
|
(9,348
|
)
|
|
—
|
|
||
Other non-cash (income) expense, net
|
|
(2,523
|
)
|
|
(2,298
|
)
|
||
Changes in assets and liabilities:
|
|
|
|
|
||||
Due from related persons
|
|
(992
|
)
|
|
(1,909
|
)
|
||
Other assets
|
|
(12,996
|
)
|
|
(8,284
|
)
|
||
Accounts payable and other liabilities
|
|
(21,979
|
)
|
|
(20,823
|
)
|
||
Due to related persons
|
|
(12,619
|
)
|
|
(5,637
|
)
|
||
Net cash provided by operating activities
|
|
387,055
|
|
|
360,078
|
|
||
|
|
|
|
|
||||
Cash flows from investing activities:
|
|
|
|
|
|
|
||
Real estate acquisitions and deposits
|
|
(594,927
|
)
|
|
(206,745
|
)
|
||
Real estate improvements
|
|
(89,955
|
)
|
|
(122,239
|
)
|
||
FF&E reserve escrow fundings
|
|
(22,011
|
)
|
|
(2,265
|
)
|
||
Net proceeds from sale of real estate
|
|
23,438
|
|
|
—
|
|
||
Net cash used in investing activities
|
|
(683,455
|
)
|
|
(331,249
|
)
|
||
|
|
|
|
|
||||
Cash flows from financing activities:
|
|
|
|
|
|
|||
Proceeds from issuance of common shares, net
|
|
—
|
|
|
371,956
|
|
||
Proceeds from issuance of senior unsecured notes, after discounts and premiums
|
|
598,246
|
|
|
737,612
|
|
||
Repayment of senior unsecured notes
|
|
—
|
|
|
(575,000
|
)
|
||
Redemption of preferred shares
|
|
(290,000
|
)
|
|
—
|
|
||
Repurchase of convertible senior notes
|
|
(8,478
|
)
|
|
—
|
|
||
Borrowings under unsecured revolving credit facility
|
|
631,000
|
|
|
643,000
|
|
||
Repayments of unsecured revolving credit facility
|
|
(364,000
|
)
|
|
(958,000
|
)
|
||
Payment of debt issuance costs
|
|
(5,018
|
)
|
|
(6,106
|
)
|
||
Repurchase of common shares
|
|
(533
|
)
|
|
(583
|
)
|
||
Distributions to preferred shareholders
|
|
(6,601
|
)
|
|
(15,498
|
)
|
||
Distributions to common shareholders
|
|
(254,623
|
)
|
|
(230,358
|
)
|
||
Net cash provided by (used in) financing activities
|
|
299,993
|
|
|
(32,977
|
)
|
||
Increase (decrease) in cash and cash equivalents
|
|
3,593
|
|
|
(4,148
|
)
|
||
Cash and cash equivalents at beginning of period
|
|
10,896
|
|
|
13,682
|
|
||
Cash and cash equivalents at end of period
|
|
$
|
14,489
|
|
|
$
|
9,534
|
|
|
|
|
|
|
||||
Supplemental cash flow information:
|
|
|
|
|
|
|||
Cash paid for interest
|
|
$
|
149,261
|
|
|
$
|
137,007
|
|
Cash paid for income taxes
|
|
2,588
|
|
|
2,464
|
|
||
Non-cash investing activities:
|
|
|
|
|
|
|
||
Hotel managers’ deposits in FF&E reserve
|
|
$
|
55,222
|
|
|
$
|
55,518
|
|
Hotel managers’ purchases with FF&E reserve
|
|
(64,574
|
)
|
|
(48,388
|
)
|
|
|
For the Three Months Ended September 30,
|
|
For the Nine Months Ended September 30,
|
||||||||
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||
|
|
(in thousands)
|
||||||||||
Weighted average common shares for basic earnings per share
|
|
164,149
|
|
|
157,217
|
|
|
164,131
|
|
|
153,357
|
|
Effect of dilutive securities: Unvested share awards
|
|
39
|
|
|
46
|
|
|
37
|
|
|
33
|
|
Weighted average common shares for diluted earnings per share
|
|
164,188
|
|
|
157,263
|
|
|
164,168
|
|
|
153,390
|
|
Acquisition Date
|
|
Location
|
|
Purchase Price
|
|
Land
|
|
Land Improvements
|
|
Building and Improvements
|
|
Furniture, Fixtures and Equipment
|
|
Intangible Assets
|
||||||||||||
2/1/2017
|
|
Chicago, IL
(1)
|
|
$
|
86,201
|
|
|
$
|
13,609
|
|
|
$
|
40
|
|
|
$
|
58,929
|
|
|
$
|
11,926
|
|
|
$
|
1,697
|
|
3/31/2017
|
|
Seattle, WA
(2)
|
|
71,795
|
|
|
24,143
|
|
|
30
|
|
|
46,337
|
|
|
844
|
|
|
441
|
|
||||||
5/3/2017
|
|
Columbia, SC
(3)
|
|
27,604
|
|
|
4,040
|
|
|
7,172
|
|
|
16,392
|
|
|
—
|
|
|
—
|
|
||||||
6/2/2017
|
|
St. Louis, MO
(4)
|
|
88,076
|
|
|
4,250
|
|
|
161
|
|
|
79,733
|
|
|
3,394
|
|
|
538
|
|
||||||
6/29/2017
|
|
Atlanta, GA
(5)
|
|
88,744
|
|
|
16,611
|
|
|
483
|
|
|
68,861
|
|
|
2,789
|
|
|
—
|
|
||||||
8/1/2017
|
|
Columbus, OH
(6)
|
|
49,188
|
|
|
6,100
|
|
|
49
|
|
|
40,678
|
|
|
2,361
|
|
|
—
|
|
||||||
8/23/2017
|
|
Charlotte, NC
(7)
|
|
43,972
|
|
|
2,682
|
|
|
1,011
|
|
|
35,266
|
|
|
5,013
|
|
|
—
|
|
||||||
9/8/2017
|
|
Atlanta, GA
(8)
|
|
940
|
|
|
940
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
9/26/2017
|
|
Various
(9)
|
|
139,954
|
|
|
30,731
|
|
|
6,393
|
|
|
93,914
|
|
|
8,916
|
|
|
—
|
|
||||||
9/28/2017
|
|
Sayre, OK
(10)
|
|
8,664
|
|
|
1,030
|
|
|
—
|
|
|
7,634
|
|
|
—
|
|
|
—
|
|
||||||
|
|
|
|
$
|
605,138
|
|
|
$
|
104,136
|
|
|
$
|
15,339
|
|
|
$
|
447,744
|
|
|
$
|
35,243
|
|
|
$
|
2,676
|
|
(1)
|
On February 1, 2017, we acquired the
483
room Hotel Allegro in Chicago, IL for a purchase price of
$86,201
, including capitalized acquisition costs of
$707
. We added this Kimpton
®
branded hotel to our management agreement with InterContinental Hotels Group, plc, or InterContinental. See Note 8 for further information regarding our InterContinental agreement.
|
(2)
|
On March 31, 2017, we acquired the
121
room Hotel Alexis in Seattle, WA for a purchase price of
$71,795
, including capitalized acquisition costs of
$170
. We added this Kimpton
®
branded hotel to our management agreement with InterContinental. See Note 8 for further information regarding our InterContinental agreement.
|
(3)
|
On May 3, 2017, pursuant to the terms of our June 2015 transaction agreement with TA, as amended, we acquired from, and leased back to, TA a newly developed travel center located in Columbia, SC for a purchase price of
$27,604
, including capitalized acquisition costs of
$2
. This property was added to our TA No. 4 lease and our minimum annual rent under the lease increased by
$2,346
as a result. See Notes 8 and 10 for further information regarding our TA leases.
|
(4)
|
On June 2, 2017, we acquired the
389
room Chase Park Plaza Hotel in St. Louis, MO for a purchase price of
$88,076
, including capitalized acquisition costs of
$462
. We converted this hotel to the Royal Sonesta
®
hotel brand and added it to our management agreement with Sonesta International Hotels Corporation, or Sonesta. See Notes 8 and 10 for further information regarding our Sonesta agreement.
|
(5)
|
On June 29, 2017, we acquired the
495
room Crowne Plaza Ravinia hotel located in Atlanta, GA for a purchase price of
$88,744
, including capitalized acquisition costs of
$140
. We added this Crowne Plaza
®
branded hotel to our management agreement with InterContinental. See Note 8 for further information regarding our InterContinental agreement.
|
(6)
|
On August 1, 2017, we acquired the
419
room Crowne Plaza & Lofts hotel in Columbus, OH for a purchase price of
$49,188
, including capitalized acquisition costs of
$198
. We added this Crowne Plaza
®
branded hotel to our management agreement with InterContinental. See Note 8 for further information regarding our InterContinental agreement.
|
(7)
|
On August 23, 2017, we acquired the
300
room Crowne Plaza hotel in Charlotte, NC for a purchase price of
$43,972
, including capitalized acquisition costs of
$115
. We added this Crowne Plaza
®
branded hotel to our management agreement with InterContinental. See Note 8 for further information regarding our InterContinental agreement.
|
(8)
|
On September 8, 2017, we acquired a land parcel adjacent to our Crowne Plaza hotel located in Atlanta, GA for a purchase price of
$940
, including capitalized acquisition costs of
$40
.
|
(9)
|
On September 26, 2017, we acquired
14
extended stay hotels with
1,653
suites located in
12
states for a purchase price of
$139,954
, including capitalized acquisition costs of
$1,954
. In connection with this acquisition, we converted these hotels to the Sonesta ES Suites
®
brand and added them to our management agreement with Sonesta. See Notes 8 and 10 for further information regarding our Sonesta agreement.
|
(10)
|
On September 28, 2017, we acquired land and certain improvements at a travel center that we previously leased from a third party and subleased to TA for a purchase price of
$8,664
, including capitalized acquisition costs of
$64
. Effective as of that date, rent due to that third party and TA’s sublease rental obligations to pay the third party rent ceased, and we amended our lease with TA to
|
|
|
For the Three Months Ended September 30, 2017
|
||||||||||||||
|
|
Hotels
|
|
Travel Centers
|
|
Corporate
|
|
Consolidated
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
|
||||||||
Hotel operating revenues
|
|
$
|
495,550
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
495,550
|
|
Rental income
|
|
7,617
|
|
|
73,279
|
|
|
—
|
|
|
80,896
|
|
||||
FF&E reserve income
|
|
1,142
|
|
|
—
|
|
|
—
|
|
|
1,142
|
|
||||
Total revenues
|
|
504,309
|
|
|
73,279
|
|
|
—
|
|
|
577,588
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Hotel operating expenses
|
|
343,274
|
|
|
—
|
|
|
—
|
|
|
343,274
|
|
||||
Depreciation and amortization
|
|
61,996
|
|
|
36,209
|
|
|
—
|
|
|
98,205
|
|
||||
General and administrative
|
|
—
|
|
|
—
|
|
|
13,404
|
|
|
13,404
|
|
||||
Total expenses
|
|
405,270
|
|
|
36,209
|
|
|
13,404
|
|
|
454,883
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Operating income (loss)
|
|
99,039
|
|
|
37,070
|
|
|
(13,404
|
)
|
|
122,705
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Dividend income
|
|
—
|
|
|
—
|
|
|
626
|
|
|
626
|
|
||||
Interest income
|
|
—
|
|
|
—
|
|
|
211
|
|
|
211
|
|
||||
Interest expense
|
|
—
|
|
|
—
|
|
|
(46,574
|
)
|
|
(46,574
|
)
|
||||
Income (loss) before income taxes, equity in earnings of an investee and gain on sale of real estate
|
|
99,039
|
|
|
37,070
|
|
|
(59,141
|
)
|
|
76,968
|
|
||||
Income tax expense
|
|
—
|
|
|
—
|
|
|
(619
|
)
|
|
(619
|
)
|
||||
Equity in earnings of an investee
|
|
—
|
|
|
—
|
|
|
31
|
|
|
31
|
|
||||
Income (loss) before gain on sale of real estate
|
|
99,039
|
|
|
37,070
|
|
|
(59,729
|
)
|
|
76,380
|
|
||||
Gain on sale of real estate
|
|
9,348
|
|
|
—
|
|
|
—
|
|
|
9,348
|
|
||||
Net income (loss)
|
|
$
|
108,387
|
|
|
$
|
37,070
|
|
|
$
|
(59,729
|
)
|
|
$
|
85,728
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
For the Nine Months Ended September 30, 2017
|
||||||||||||||
|
|
Hotels
|
|
Travel Centers
|
|
Corporate
|
|
Consolidated
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
|
||||||||
Hotel operating revenues
|
|
$
|
1,392,995
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,392,995
|
|
Rental income
|
|
22,854
|
|
|
217,420
|
|
|
—
|
|
|
240,274
|
|
||||
FF&E reserve income
|
|
3,524
|
|
|
—
|
|
|
—
|
|
|
3,524
|
|
||||
Total revenues
|
|
1,419,373
|
|
|
217,420
|
|
|
—
|
|
|
1,636,793
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Hotel operating expenses
|
|
965,546
|
|
|
—
|
|
|
—
|
|
|
965,546
|
|
||||
Depreciation and amortization
|
|
179,503
|
|
|
107,308
|
|
|
—
|
|
|
286,811
|
|
||||
General and administrative
|
|
—
|
|
|
—
|
|
|
76,097
|
|
|
76,097
|
|
||||
Total expenses
|
|
1,145,049
|
|
|
107,308
|
|
|
76,097
|
|
|
1,328,454
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Operating income (loss)
|
|
274,324
|
|
|
110,112
|
|
|
(76,097
|
)
|
|
308,339
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Dividend income
|
|
—
|
|
|
—
|
|
|
1,878
|
|
|
1,878
|
|
||||
Interest income
|
|
—
|
|
|
—
|
|
|
590
|
|
|
590
|
|
||||
Interest expense
|
|
—
|
|
|
—
|
|
|
(135,329
|
)
|
|
(135,329
|
)
|
||||
Income (loss) before income taxes, equity in earnings of an investee and gain on sale of real estate
|
|
274,324
|
|
|
110,112
|
|
|
(208,958
|
)
|
|
175,478
|
|
||||
Income tax expense
|
|
—
|
|
|
—
|
|
|
(1,761
|
)
|
|
(1,761
|
)
|
||||
Equity in earnings of an investee
|
|
—
|
|
|
—
|
|
|
533
|
|
|
533
|
|
||||
Income (loss) before gain on sale of real estate
|
|
274,324
|
|
|
110,112
|
|
|
(210,186
|
)
|
|
174,250
|
|
||||
Gain on sale of real estate
|
|
9,348
|
|
|
—
|
|
|
—
|
|
|
9,348
|
|
||||
Net income (loss)
|
|
$
|
283,672
|
|
|
$
|
110,112
|
|
|
$
|
(210,186
|
)
|
|
$
|
183,598
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
As of September 30, 2017
|
||||||||||||||
|
|
Hotels
|
|
Travel Centers
|
|
Corporate
|
|
Consolidated
|
||||||||
Total assets
|
|
$
|
4,490,298
|
|
|
$
|
2,486,179
|
|
|
$
|
167,990
|
|
|
$
|
7,144,467
|
|
|
|
For the Three Months Ended September 30, 2016
|
||||||||||||||
|
|
Hotels
|
|
Travel Centers
|
|
Corporate
|
|
Consolidated
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
|
||||||||
Hotel operating revenues
|
|
$
|
464,981
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
464,981
|
|
Rental income
|
|
7,604
|
|
|
69,866
|
|
|
—
|
|
|
77,470
|
|
||||
FF&E reserve income
|
|
1,065
|
|
|
—
|
|
|
—
|
|
|
1,065
|
|
||||
Total revenues
|
|
473,650
|
|
|
69,866
|
|
|
—
|
|
|
543,516
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Hotel operating expenses
|
|
322,012
|
|
|
—
|
|
|
—
|
|
|
322,012
|
|
||||
Depreciation and amortization
|
|
56,397
|
|
|
33,742
|
|
|
—
|
|
|
90,139
|
|
||||
General and administrative
|
|
—
|
|
|
—
|
|
|
37,739
|
|
|
37,739
|
|
||||
Acquisition related costs
|
|
156
|
|
|
—
|
|
|
—
|
|
|
156
|
|
||||
Total expenses
|
|
378,565
|
|
|
33,742
|
|
|
37,739
|
|
|
450,046
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Operating income (loss)
|
|
95,085
|
|
|
36,124
|
|
|
(37,739
|
)
|
|
93,470
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Dividend income
|
|
|
|
|
|
|
|
626
|
|
|
626
|
|
||||
Interest income
|
|
—
|
|
|
—
|
|
|
89
|
|
|
89
|
|
||||
Interest expense
|
|
—
|
|
|
—
|
|
|
(41,280
|
)
|
|
(41,280
|
)
|
||||
Loss on early extinguishment of debt
|
|
|
|
|
|
|
|
(158
|
)
|
|
(158
|
)
|
||||
Income (loss) before income taxes and equity in earnings of an investee
|
|
95,085
|
|
|
36,124
|
|
|
(78,462
|
)
|
|
52,747
|
|
||||
Income tax expense
|
|
—
|
|
|
—
|
|
|
(948
|
)
|
|
(948
|
)
|
||||
Equity in earnings of an investee
|
|
—
|
|
|
—
|
|
|
13
|
|
|
13
|
|
||||
Net income (loss)
|
|
$
|
95,085
|
|
|
$
|
36,124
|
|
|
$
|
(79,397
|
)
|
|
$
|
51,812
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
For the Nine Months Ended September 30, 2016
|
||||||||||||||
|
|
Hotels
|
|
Travel Centers
|
|
Corporate
|
|
Consolidated
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
|
||||||||
Hotel operating revenues
|
|
$
|
1,334,656
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,334,656
|
|
Rental income
|
|
22,810
|
|
|
206,950
|
|
|
—
|
|
|
229,760
|
|
||||
FF&E reserve income
|
|
3,517
|
|
|
—
|
|
|
—
|
|
|
3,517
|
|
||||
Total revenues
|
|
1,360,983
|
|
|
206,950
|
|
|
—
|
|
|
1,567,933
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Hotel operating expenses
|
|
923,239
|
|
|
—
|
|
|
—
|
|
|
923,239
|
|
||||
Depreciation and amortization
|
|
167,485
|
|
|
98,707
|
|
|
—
|
|
|
266,192
|
|
||||
General and administrative
|
|
—
|
|
|
—
|
|
|
91,127
|
|
|
91,127
|
|
||||
Acquisition related costs
|
|
885
|
|
|
—
|
|
|
—
|
|
|
885
|
|
||||
Total expenses
|
|
1,091,609
|
|
|
98,707
|
|
|
91,127
|
|
|
1,281,443
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Operating income (loss)
|
|
269,374
|
|
|
108,243
|
|
|
(91,127
|
)
|
|
286,490
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Dividend income
|
|
|
|
|
|
|
|
1,375
|
|
|
1,375
|
|
||||
Interest income
|
|
—
|
|
|
—
|
|
|
227
|
|
|
227
|
|
||||
Interest expense
|
|
—
|
|
|
—
|
|
|
(124,564
|
)
|
|
(124,564
|
)
|
||||
Loss on early extinguishment of debt
|
|
|
|
|
|
|
|
(228
|
)
|
|
(228
|
)
|
||||
Income (loss) before income taxes and equity in earnings of an investee
|
|
269,374
|
|
|
108,243
|
|
|
(214,317
|
)
|
|
163,300
|
|
||||
Income tax expense
|
|
—
|
|
|
—
|
|
|
(3,483
|
)
|
|
(3,483
|
)
|
||||
Equity in earnings of an investee
|
|
—
|
|
|
—
|
|
|
107
|
|
|
107
|
|
||||
Net income (loss)
|
|
$
|
269,374
|
|
|
$
|
108,243
|
|
|
$
|
(217,693
|
)
|
|
$
|
159,924
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
As of December 31, 2016
|
||||||||||||||
|
|
Hotels
|
|
Travel Centers
|
|
Corporate
|
|
Consolidated
|
||||||||
Total assets
|
|
$
|
4,005,481
|
|
|
$
|
2,483,718
|
|
|
$
|
145,029
|
|
|
$
|
6,634,228
|
|
|
|
|
|
|
Fair Value at September 30, 2017 Using
|
|||||||||||
|
|
|
|
Quoted Prices in
|
|
|
|
|
||||||||
|
|
|
|
Active Markets for
|
|
Significant Other
|
|
Significant
|
||||||||
|
|
Carrying Value at
|
|
Identical Assets
|
|
Observable Inputs
|
|
Unobservable Inputs
|
||||||||
Description
|
|
September 30, 2017
|
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
||||||||
Recurring Fair Value Measurement Assets:
|
|
|
|
|
|
|
||||||||||
Investment in TA
(1)
|
|
$
|
14,535
|
|
|
$
|
14,535
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Investment in RMR Inc.
(2)
|
|
$
|
128,569
|
|
|
$
|
128,569
|
|
|
$
|
—
|
|
|
$
|
—
|
|
(1)
|
Our
3,420,000
common shares of TA, which are included in other assets in our condensed consolidated balance sheets, are reported at fair value which is based on quoted market prices (Level 1 inputs). Our historical cost basis for these shares is
$17,407
as of
September 30, 2017
. The unrealized loss of
($2,872)
for these shares as of
September 30, 2017
is included in cumulative other comprehensive income in our condensed consolidated balance sheets. We evaluated the decline in the fair value of the TA shares and determined that based on the severity and duration of the decline, and our ability and intent to hold the investment for a reasonable period of time sufficient for a recovery of fair value, we do not consider this investment to be other-than-temporarily impaired at
September 30, 2017
.
|
(2)
|
Our
2,503,777
shares of class A common stock of RMR Inc., which are included in other assets in our condensed consolidated balance sheets, are reported at fair value which is based on quoted market prices (Level 1 inputs). Our historical cost basis for these shares is
$66,374
as of
September 30, 2017
. The unrealized gain of
$62,195
for these shares as of
September 30, 2017
is included in cumulative other comprehensive income in our condensed consolidated balance sheets.
|
|
|
September 30, 2017
|
|
December 31, 2016
|
||||||||||||
|
|
Carrying
|
|
Fair
|
|
Carrying
|
|
Fair
|
||||||||
|
|
Value
(1)
|
|
Value
|
|
Value
(1)
|
|
Value
|
||||||||
Senior Unsecured Notes, due 2018 at 6.70%
(2)
|
|
$
|
349,812
|
|
|
$
|
351,253
|
|
|
$
|
349,387
|
|
|
$
|
358,740
|
|
Senior Unsecured Notes, due 2021 at 4.25%
|
|
395,137
|
|
|
417,246
|
|
|
394,056
|
|
|
413,790
|
|
||||
Senior Unsecured Notes, due 2022 at 5.00%
|
|
494,095
|
|
|
537,360
|
|
|
493,187
|
|
|
527,945
|
|
||||
Senior Unsecured Notes, due 2023 at 4.50%
|
|
499,063
|
|
|
530,825
|
|
|
298,134
|
|
|
298,845
|
|
||||
Senior Unsecured Notes, due 2024 at 4.65%
|
|
347,383
|
|
|
367,026
|
|
|
347,079
|
|
|
348,523
|
|
||||
Senior Unsecured Notes, due 2025 at 4.50%
|
|
344,883
|
|
|
360,227
|
|
|
344,368
|
|
|
341,439
|
|
||||
Senior Unsecured Notes, due 2026 at 5.25%
|
|
340,544
|
|
|
375,799
|
|
|
339,697
|
|
|
354,772
|
|
||||
Senior Unsecured Notes, due 2027 at 4.95%
|
|
392,948
|
|
|
421,316
|
|
|
—
|
|
|
—
|
|
||||
Convertible Unsecured Senior Notes, due 2027 at 3.8%
(3)
|
|
—
|
|
|
—
|
|
|
8,478
|
|
|
8,599
|
|
||||
Total financial liabilities
|
|
$
|
3,163,865
|
|
|
$
|
3,361,052
|
|
|
$
|
2,574,386
|
|
|
$
|
2,652,653
|
|
(1)
|
Carrying value includes unamortized discounts and premiums and certain issuance costs.
|
(2)
|
These senior notes were redeemed at par plus accrued interest in October 2017.
|
(3)
|
These convertible senior notes were redeemed at par plus accrued interest in April 2017.
|
|
|
For the Three Months Ended September 30,
|
|||||||||||||
|
|
|
|
|
|
Increase
|
|
% Increase
|
|||||||
|
|
2017
|
|
2016
|
|
(Decrease)
|
|
(Decrease)
|
|||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Hotel operating revenues
|
|
$
|
495,550
|
|
|
$
|
464,981
|
|
|
$
|
30,569
|
|
|
6.6
|
%
|
Rental income - hotels
|
|
7,617
|
|
|
7,604
|
|
|
13
|
|
|
0.2
|
%
|
|||
Rental income - travel centers
|
|
73,279
|
|
|
69,866
|
|
|
3,413
|
|
|
4.9
|
%
|
|||
Total rental income
|
|
80,896
|
|
|
77,470
|
|
|
3,426
|
|
|
4.4
|
%
|
|||
FF&E reserve income
|
|
1,142
|
|
|
1,065
|
|
|
77
|
|
|
7.2
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Hotel operating expenses
|
|
343,274
|
|
|
322,012
|
|
|
21,262
|
|
|
6.6
|
%
|
|||
Depreciation and amortization - hotels
|
|
61,996
|
|
|
56,397
|
|
|
5,599
|
|
|
9.9
|
%
|
|||
Depreciation and amortization - travel centers
|
|
36,209
|
|
|
33,742
|
|
|
2,467
|
|
|
7.3
|
%
|
|||
Total depreciation and amortization
|
|
98,205
|
|
|
90,139
|
|
|
8,066
|
|
|
8.9
|
%
|
|||
General and administrative
|
|
13,404
|
|
|
37,739
|
|
|
(24,335
|
)
|
|
(64.5
|
)%
|
|||
Acquisition related costs
|
|
—
|
|
|
156
|
|
|
(156
|
)
|
|
(100.0
|
)%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Operating income
|
|
122,705
|
|
|
93,470
|
|
|
29,235
|
|
|
31.3
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Dividend income
|
|
626
|
|
|
626
|
|
|
—
|
|
|
—
|
%
|
|||
Interest income
|
|
211
|
|
|
89
|
|
|
122
|
|
|
137.1
|
%
|
|||
Interest expense
|
|
(46,574
|
)
|
|
(41,280
|
)
|
|
(5,294
|
)
|
|
12.8
|
%
|
|||
Loss on early extinguishment of debt
|
|
—
|
|
|
(158
|
)
|
|
158
|
|
|
—
|
%
|
|||
Income before income taxes, equity earnings of an investee and gain on sale of real estate
|
|
76,968
|
|
|
52,747
|
|
|
24,221
|
|
|
45.9
|
%
|
|||
Income tax expense
|
|
(619
|
)
|
|
(948
|
)
|
|
329
|
|
|
(34.7
|
)%
|
|||
Equity in earnings of an investee
|
|
31
|
|
|
13
|
|
|
18
|
|
|
138.5
|
%
|
|||
Income before gain on sale of real estate
|
|
76,380
|
|
|
51,812
|
|
|
24,568
|
|
|
47.4
|
%
|
|||
Gain on sale of real estate
|
|
9,348
|
|
|
—
|
|
|
9,348
|
|
|
100.0
|
%
|
|||
Net income
|
|
85,728
|
|
|
51,812
|
|
|
33,916
|
|
|
65.5
|
%
|
|||
Preferred distributions
|
|
—
|
|
|
(5,166
|
)
|
|
5,166
|
|
|
(100.0
|
)%
|
|||
Net income available for common shareholders
|
|
$
|
85,728
|
|
|
$
|
46,646
|
|
|
$
|
39,082
|
|
|
83.8
|
%
|
|
|
|
|
|
|
|
|
|
|
||||||
Weighted average shares outstanding (basic)
|
|
164,149
|
|
|
157,217
|
|
|
6,932
|
|
|
4.4
|
%
|
|||
Weighted average shares outstanding (diluted)
|
|
164,188
|
|
|
157,263
|
|
|
6,925
|
|
|
4.4
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Net income available for common shareholders per common share (basic and diluted)
|
|
$
|
0.52
|
|
|
$
|
0.30
|
|
|
$
|
0.22
|
|
|
73.3
|
%
|
|
|
For the Nine Months Ended September 30,
|
|||||||||||||
|
|
|
|
|
|
Increase
|
|
% Increase
|
|||||||
|
|
2017
|
|
2016
|
|
(Decrease)
|
|
(Decrease)
|
|||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|||||
Hotel operating revenues
|
|
$
|
1,392,995
|
|
|
$
|
1,334,656
|
|
|
$
|
58,339
|
|
|
4.4
|
%
|
Rental income - hotels
|
|
22,854
|
|
|
22,810
|
|
|
44
|
|
|
0.2
|
%
|
|||
Rental income - travel centers
|
|
217,420
|
|
|
206,950
|
|
|
10,470
|
|
|
5.1
|
%
|
|||
Total rental income
|
|
240,274
|
|
|
229,760
|
|
|
10,514
|
|
|
4.6
|
%
|
|||
FF&E reserve income
|
|
3,524
|
|
|
3,517
|
|
|
7
|
|
|
0.2
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Hotel operating expenses
|
|
965,546
|
|
|
923,239
|
|
|
42,307
|
|
|
4.6
|
%
|
|||
Depreciation and amortization - hotels
|
|
179,503
|
|
|
167,485
|
|
|
12,018
|
|
|
7.2
|
%
|
|||
Depreciation and amortization - travel centers
|
|
107,308
|
|
|
98,707
|
|
|
8,601
|
|
|
8.7
|
%
|
|||
Total depreciation and amortization
|
|
286,811
|
|
|
266,192
|
|
|
20,619
|
|
|
7.7
|
%
|
|||
General and administrative
|
|
76,097
|
|
|
91,127
|
|
|
(15,030
|
)
|
|
(16.5
|
)%
|
|||
Acquisition related costs
|
|
—
|
|
|
885
|
|
|
(885
|
)
|
|
(100.0
|
)%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Operating income
|
|
308,339
|
|
|
286,490
|
|
|
21,849
|
|
|
7.6
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Dividend income
|
|
1,878
|
|
|
1,375
|
|
|
503
|
|
|
36.6
|
%
|
|||
Interest income
|
|
590
|
|
|
227
|
|
|
363
|
|
|
159.9
|
%
|
|||
Interest expense
|
|
(135,329
|
)
|
|
(124,564
|
)
|
|
(10,765
|
)
|
|
8.6
|
%
|
|||
Loss on early extinguishment of debt
|
|
—
|
|
|
(228
|
)
|
|
228
|
|
|
(100.0
|
)%
|
|||
Income before income taxes, equity earnings of an investee and gain on sale of real estate
|
|
175,478
|
|
|
163,300
|
|
|
12,178
|
|
|
7.5
|
%
|
|||
Income tax expense
|
|
(1,761
|
)
|
|
(3,483
|
)
|
|
1,722
|
|
|
(49.4
|
)%
|
|||
Equity in earnings of an investee
|
|
533
|
|
|
107
|
|
|
426
|
|
|
398.1
|
%
|
|||
Income before gain on sale of real estate
|
|
174,250
|
|
|
159,924
|
|
|
14,326
|
|
|
9.0
|
%
|
|||
Gain on sale of real estate
|
|
9,348
|
|
|
—
|
|
|
9,348
|
|
|
100.0
|
%
|
|||
Net income
|
|
183,598
|
|
|
159,924
|
|
|
23,674
|
|
|
14.8
|
%
|
|||
Preferred distributions
|
|
(1,435
|
)
|
|
(15,498
|
)
|
|
14,063
|
|
|
(90.7
|
)%
|
|||
Excess of liquidation preference over carrying value of preferred shares redeemed
|
|
(9,893
|
)
|
|
—
|
|
|
(9,893
|
)
|
|
n/m
|
|
|||
Net income available for common shareholders
|
|
$
|
172,270
|
|
|
$
|
144,426
|
|
|
$
|
27,844
|
|
|
19.3
|
%
|
|
|
|
|
|
|
|
|
|
|||||||
Weighted average shares outstanding (basic)
|
|
164,131
|
|
|
153,357
|
|
|
10,774
|
|
|
7.0
|
%
|
|||
Weighted average shares outstanding (diluted)
|
|
164,168
|
|
|
153,390
|
|
|
10,778
|
|
|
7.0
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Net income available for common shareholders per common share (basic and diluted)
|
|
$
|
1.05
|
|
|
$
|
0.94
|
|
|
$
|
0.11
|
|
|
11.7
|
%
|
•
|
During the
nine
months ended
September 30, 2017
, we funded
$4,638
for capital improvements to hotels under our Marriott No. 1 agreement using cash on hand and borrowings under our revolving credit facility. We currently expect to fund approximately
$1,000
for capital improvements under this agreement during the remainder of
2017
using cash on hand or borrowings under our revolving credit facility. As we fund these improvements, the annual minimum returns payable to us increase.
|
•
|
During the
nine
months ended
September 30, 2017
, we funded
$1,975
for capital improvements to hotels under our Marriott No. 234 agreement using cash on hand and borrowings under our revolving credit facility. We currently expect to fund approximately
$3,025
for capital improvements under this agreement during the remainder of
2017
using cash on hand or borrowings under our revolving credit facility. As we fund these improvements, the annual minimum returns payable to us increase.
|
•
|
We did not fund any capital improvements to hotels under our InterContinental agreement during the
nine
months ended
September 30, 2017
. We currently expect to fund approximately
$10,950
for capital improvements under this agreement during the remainder of
2017
, approximately
$28,000
during 2018 and approximately
$20,000
during 2019 using cash on hand or borrowings under our revolving credit facility. As we fund these improvements, the annual minimum returns payable to us increase.
|
•
|
Our Sonesta agreement does not require FF&E escrow deposits. Under our Sonesta agreement, we are required to fund capital expenditures made at our hotels. During the
nine
months ended
September 30, 2017
, we funded
$21,892
for capital improvements to hotels included in our Sonesta agreement using cash on hand and borrowings under our revolving credit facility. We currently expect to fund approximately
$7,692
for renovations and other capital improvements under this agreement during the remainder of
2017
, approximately
$86,000
during 2018 and approximately
$5,000
during 2019 using cash on hand or borrowings under our revolving credit facility. As we fund these improvements, the annual minimum returns payable to us increase to the extent amounts funded exceed threshold amounts, as defined in our Sonesta agreement.
|
•
|
Our Wyndham agreement requires FF&E escrow deposits only if there are excess cash flows after payment of our minimum returns. No FF&E escrow deposits were required during the
nine
months ended
September 30, 2017
. During the
nine
months ended
September 30, 2017
, we funded
$5,045
for capital improvements to hotels included in our Wyndham agreement using cash on hand and borrowings under our revolving credit facility. We currently expect to fund approximately
$1,800
for capital improvements under this agreement during the remainder of
2017
using cash on hand or borrowings under our revolving credit facility. As we fund these improvements, the annual minimum returns payable to us increase.
|
•
|
Pursuant to an agreement we entered into with Carlson in June 2017, during the nine months ended September 30, 2017, we deposited
$15,398
of net proceeds from the sale of two hotels into the FF&E reserve escrow account for our Carlson agreement and we deposited the remaining
$8,030
of net proceeds from the sale of a third hotel into the FF&E reserve escrow account in October 2017. These amounts will be used to fund certain renovations to the remaining hotels operated under our Carlson agreement. We have agreed to fund up to
$35,000
for renovation costs in excess of the net sales proceeds and available FF&E reserves. We currently expect to fund approximately
$6,400
during 2018 and approximately
$28,600
during 2019 for these renovations. As we fund these renovations, the annual minimum returns payable to us will increase.
|
|
|
|
|
|
|
|
|
|
|
Rent / Return Coverage
(3)
|
||||||||||||
|
|
|
|
Number of
|
|
|
|
Annual
|
|
Three Months Ended
|
|
Twelve Months Ended
|
||||||||||
Operating Agreement
|
|
Number of
|
|
Rooms /
|
|
|
|
Minimum
|
|
September 30,
|
|
September 30,
|
||||||||||
Reference Name
|
|
Properties
|
|
Suites
|
|
Investment
(1)
|
|
Return/Rent
(2)
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||
Marriott (No. 1)
(4)
|
|
53
|
|
|
7,610
|
|
|
$
|
695,937
|
|
|
$
|
69,100
|
|
|
1.50x
|
|
1.59x
|
|
1.26x
|
|
1.39x
|
Marriott (No. 234)
(5)
|
|
68
|
|
|
9,120
|
|
|
1,003,364
|
|
|
106,538
|
|
|
1.22x
|
|
1.23x
|
|
1.12x
|
|
1.13x
|
||
Marriott (No. 5)
(6)
|
|
1
|
|
|
356
|
|
|
90,078
|
|
|
10,159
|
|
|
1.05x
|
|
0.89x
|
|
0.84x
|
|
0.73x
|
||
Subtotal / Average Marriott
|
|
122
|
|
|
17,086
|
|
|
1,789,379
|
|
|
185,797
|
|
|
1.31x
|
|
1.34x
|
|
1.16x
|
|
1.21x
|
||
InterContinental
(7)
|
|
99
|
|
|
16,237
|
|
|
2,035,813
|
|
|
188,920
|
|
|
1.25x
|
|
1.36x
|
|
1.14x
|
|
1.21x
|
||
Sonesta
(8)
|
|
49
|
|
|
8,371
|
|
|
1,444,439
|
|
|
108,973
|
|
|
0.83x
|
|
1.01x
|
|
0.75x
|
|
0.82x
|
||
Wyndham
(9)
|
|
22
|
|
|
3,579
|
|
|
391,804
|
|
|
28,808
|
|
|
1.15x
|
|
1.17x
|
|
0.83x
|
|
0.94x
|
||
Hyatt
(10)
|
|
22
|
|
|
2,724
|
|
|
301,942
|
|
|
22,037
|
|
|
1.17x
|
|
1.12x
|
|
1.14x
|
|
1.17x
|
||
Carlson
(11)
|
|
8
|
|
|
1,579
|
|
|
187,070
|
|
|
12,920
|
|
|
1.73x
|
|
1.66x
|
|
1.35x
|
|
1.25x
|
||
Morgans
(12)
|
|
1
|
|
|
372
|
|
|
120,000
|
|
|
7,595
|
|
|
0.97x
|
|
1.13x
|
|
0.86x
|
|
1.07x
|
||
Subtotal / Average Hotels
|
|
323
|
|
|
49,948
|
|
|
6,270,447
|
|
|
555,050
|
|
|
1.19x
|
|
1.27x
|
|
1.05x
|
|
1.12x
|
||
TA (No. 1)
(13)
|
|
40
|
|
|
N/A
|
|
|
672,884
|
|
|
52,410
|
|
|
1.80x
|
|
1.88x
|
|
1.58x
|
|
1.67x
|
||
TA (No. 2)
(14)
|
|
40
|
|
|
N/A
|
|
|
676,562
|
|
|
53,299
|
|
|
1.69x
|
|
1.73x
|
|
1.50x
|
|
1.53x
|
||
TA (No. 3)
(15)
|
|
39
|
|
|
N/A
|
|
|
632,069
|
|
|
53,670
|
|
|
1.76x
|
|
1.83x
|
|
1.50x
|
|
1.60x
|
||
TA (No. 4)
(16)
|
|
40
|
|
|
N/A
|
|
|
614,323
|
|
|
54,046
|
|
|
1.60x
|
|
1.78x
|
|
1.41x
|
|
1.58x
|
||
TA (No. 5)
(17)
|
|
40
|
|
|
N/A
|
|
|
880,832
|
|
|
69,114
|
|
|
1.74x
|
|
1.69x
|
|
1.56x
|
|
1.59x
|
||
Subtotal / Average TA
|
|
199
|
|
|
N/A
|
|
|
3,476,670
|
|
|
282,539
|
|
|
1.72x
|
|
1.78x
|
|
1.51x
|
|
1.59x
|
||
Total / Average
|
|
522
|
|
|
49,948
|
|
|
$
|
9,747,117
|
|
|
$
|
837,589
|
|
|
1.37x
|
|
1.44x
|
|
1.21x
|
|
1.25x
|
(1)
|
Represents the historical cost of our properties plus capital improvements funded by us less impairment writedowns, if any, and excludes capital improvements made from FF&E reserves funded from hotel operations which do not result in increases in minimum returns or rents.
|
(2)
|
Each of our management agreements or leases provides for payment to us of an annual minimum return or rent, respectively. Certain of these minimum payment amounts are secured by full or limited guarantees or security deposits as more fully described below. In addition, certain of our hotel management agreements provide for payment to us of additional amounts to the extent of available cash flows as defined in the management agreement. Payments of these additional amounts are not guaranteed or secured by deposits. Annualized minimum rent amounts represent cash rent amounts due to us and exclude adjustments necessary to record rent on a straight line basis.
|
(3)
|
We define coverage as combined total property level revenues minus all property level expenses and FF&E reserve escrows which are not subordinated to minimum returns and rents due to us (which data is provided to us by our managers or tenants), divided by the minimum returns or rents due to us. Coverage amounts for our InterContinental and Sonesta agreements and our TA Nos. 1, 2, 3 and 4 leases include data for periods prior to our ownership of certain properties. Coverage amounts for our Carlson agreement excludes data for periods prior to our sale of certain hotels.
|
(4)
|
We lease
53
Courtyard by Marriott
®
branded hotels in 24 states to one of our TRSs. The hotels are managed by a subsidiary of Marriott under a combination management agreement which expires in 2024; Marriott has two renewal options for 12 years each for all, but not less than all, of the hotels.
|
(5)
|
We lease
68
of our Marriott branded hotels (one full service Marriott
®
, 35 Residence Inn by Marriott
®
, 18 Courtyard by Marriott
®
, 12 TownePlace Suites by Marriott
®
and two SpringHill Suites by Marriott
®
hotels) in 22 states to one of our TRSs. The hotels are managed by subsidiaries of Marriott under a combination management agreement which expires in 2025; Marriott has two renewal options for 10 years each for all, but not less than all, of the hotels.
|
(6)
|
We lease one Marriott
®
branded hotel in Kauai, HI to a subsidiary of Marriott under a lease that expires in 2019. Marriott has four renewal options for 15 years each. On August 31, 2016, Marriott notified us that it will not exercise its renewal option at the expiration of the current lease term ending on December 31, 2019. This lease is guaranteed by Marriott and provides for increases in the annual minimum rent payable to us based on changes in the consumer price index.
|
(7)
|
We lease our 98 InterContinental branded hotels (19 Staybridge Suites
®
, 61 Candlewood Suites
®
, two InterContinental
®
, 10 Crowne Plaza
®
, three Holiday Inn
®
and three Kimpton
®
Hotels & Restaurants) in 28 states in the U.S. and Ontario, Canada to one of our TRSs. These 98 hotels are managed by subsidiaries of InterContinental under a combination management agreement. We lease one additional InterContinental
®
branded hotel in Puerto Rico to a subsidiary of InterContinental. The annual minimum return amount presented in the table on page
34
includes
$7,904
of minimum rent related to the leased Puerto Rico hotel. The management agreement and the lease expire in 2036; InterContinental has two renewal options for 15 years each for all, but not less than all, of the hotels.
|
(8)
|
We lease our
49
Sonesta branded hotels (five Royal Sonesta Hotels
®
, five Sonesta Hotels & Resorts
®
and 39 Sonesta ES Suites
®
hotels) in 26 states to one of our TRSs. The hotels are managed by Sonesta under a combination management agreement which expires in 2037; Sonesta has two renewal options for 15 years each for all, but not less than all, of the hotels.
|
(9)
|
We lease our
22
Wyndham branded hotels (six Wyndham Hotels and Resorts
®
and 16 Hawthorn Suites
®
hotels) in 14 states to one of our TRSs. The hotels are managed by a subsidiary of Wyndham under a combination management agreement which expires in 2038; Wyndham has two renewal options for 15 years each for all, but not less than all, of the hotels. We also lease 48 vacation units in one of the managed hotels to Wyndham Vacation under a lease that expires in 2037; Wyndham Vacation has two renewal options for 15 years each for all, but not less than all, of the vacation units. The lease is guaranteed by Wyndham and provides for rent increases of 3% per annum. The annual minimum return amount presented in the table on page
34
includes $1,407 of minimum rent related to the Wyndham Vacation lease.
|
(10)
|
We lease our
22
Hyatt Place
®
branded hotels in 14 states to one of our TRSs. The hotels are managed by a subsidiary of Hyatt under a combination management agreement that expires in 2030; Hyatt has two renewal options for 15 years each for all, but not less than all, of the hotels.
|
(11)
|
We lease our
8
Carlson branded hotels (four Radisson
®
Hotels & Resorts and four Country Inns & Suites
®
hotels) in six states to one of our TRSs. The hotels are managed by a subsidiary of Carlson under a combination management agreement that, prior to the amendment described below, was scheduled to expire in 2030; Carlson has two renewal options for 15 years each for all, but not less than all, of the hotels. In June 2017, we amended our agreement with Carlson whereby we and Carlson agreed to sell three hotels with an aggregate of
511
rooms. We sold these hotels during the three months ended September 2017. The net proceeds from the sales of these three hotels will be used to fund certain renovations to the remaining hotels operated under our Carlson agreement and we have agreed to fund up to
$35,000
for renovation costs in excess of the net sales proceeds and available FF&E reserves. Our annual minimum return and the limited guarantee cap under our Carlson agreement will increase by 8% of amounts we fund. In addition, the initial term of the management agreement and the limited guarantee provided by Carlson were extended to December 31, 2035.
|
(12)
|
We lease The Clift Hotel
®
in San Francisco, CA to a subsidiary of Morgans. This lease is scheduled to expire in 2103 and requires annual rent to us of $7,595, which amount is scheduled to increase on October 14, 2019 and every five years thereafter based upon consumer price index increases of no less than 10% and no more than 20% at the time of each increase. Although the terms of this lease might have qualified this lease as a direct financing lease under GAAP, we recognize the rental income we receive from Morgans on a cash basis because of uncertainty regarding our collection of future rent increases. In December 2016, we notified Morgans that the closing of its merger with SBE without our consent was a breach of its lease obligations and shortly thereafter we commenced an unlawful detainer action in the California state courts to compel Morgans and SBE to surrender possession of this hotel to us. We are pursuing this litigation and are in discussions with Morgans and SBE regarding this hotel. The outcome of this pending litigation and our discussions with Morgans and SBE is not assured, but we believe Morgans may surrender to us possession of this hotel or that the court will determine that Morgans and SBE have breached the lease. We also believe that this hotel may require substantial capital investment to remain competitive in its market. The continuation of our dispute with Morgans and SBE is causing us to incur legal fees. Despite the continuation of this dispute, Morgans has paid the rents due to us through
November 7, 2017
; however, we believe that we may suffer some loss of future rent from this hotel, at least until this hotel is renovated and operations improve.
|
(13)
|
We lease
40
travel centers (36 TravelCenters of America
®
branded travel centers and four Petro Stopping Centers
®
branded travel centers) in 29 states to a subsidiary of TA under a lease that expires in 2029; TA has two renewal options for 15 years each for all, but not less than all, of these travel centers. In addition to the payment of our minimum rent, this lease provides for payment to us of percentage rent based on increases in total non-fuel revenues over base year levels (3% of non-fuel revenues above 2015 non-fuel revenues). TA’s previously deferred rent of
$27,421
is due at the expiration of the initial term of this lease. This lease is guaranteed by TA.
|
(14)
|
We lease
40
travel centers (38 TravelCenters of America
®
branded travel centers and two Petro Stopping Centers
®
branded travel centers) in 27 states to a subsidiary of TA under a lease that expires in 2028; TA has two renewal options for 15 years each for all, but not less than all, of these travel centers. In addition to the payment of our minimum rent, this lease provides for payment to us of percentage rent based on increases in total non-fuel revenues over base year levels (3% of non-fuel revenues above 2015 non-fuel revenues). TA’s previously deferred rent of
$29,107
is due at the expiration of the initial term of this lease. This lease is guaranteed by TA.
|
(15)
|
We lease
39
travel centers (38 TravelCenters of America
®
branded travel centers and one Petro Stopping Centers
®
branded travel center) in 29 states to a subsidiary of TA under a lease that expires in 2026; TA has two renewal options for 15 years each for all, but not less than all, of these travel centers. In addition to the payment of our minimum rent, this lease provides for payment to us of percentage rent based on increases in total non-fuel revenues over base year levels (3% of non-fuel revenues above 2015 non-fuel revenues). TA’s previously deferred rent of
$29,324
is due at the expiration of the initial term of this lease. This lease is guaranteed by TA.
|
(16)
|
We lease
40
travel centers (37 TravelCenters of America
®
branded travel centers and three Petro Stopping Centers
®
branded travel centers) in 28 states to a subsidiary of TA under a lease that expires in 2030; TA has two renewal options for 15 years each for all, but not less than all, of these travel centers. In addition to the payment of our minimum rent, this lease provides for payment to us of percentage rent based on increases in total non-fuel revenues over base year levels (3% of non-fuel revenues above 2015 non-fuel revenues). TA’s previously deferred rent of
$21,233
is due at the expiration of the initial term of this lease. This lease is guaranteed by TA.
|
(17)
|
We lease
40
Petro Stopping Centers
®
branded travel centers in 25 states to a subsidiary of TA under a lease that expires in 2032; TA has two renewal options for 15 years each for all, but not less than all, of these travel centers. In addition to the payment of our minimum rent, this lease provides for payment to us of percentage rent based on increases in total non-fuel revenues over base year levels (3% of non-fuel revenues above 2012 non-fuel revenues). TA’s previously deferred rent of
$42,915
is due on June 30, 2024. This lease is guaranteed by TA.
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
|
|
No. of
|
|
No. of Rooms /
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||
|
|
Hotels
|
|
Suites
|
|
2017
|
|
2016
|
|
Change
|
|
2017
|
|
2016
|
|
Change
|
||||||||||||
ADR
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Marriott (No. 1)
|
|
53
|
|
|
7,610
|
|
|
$
|
131.54
|
|
|
$
|
134.12
|
|
|
(1.9
|
%)
|
|
$
|
131.82
|
|
|
$
|
133.42
|
|
|
(1.2
|
%)
|
Marriott (No. 234)
|
|
68
|
|
|
9,120
|
|
|
133.48
|
|
|
132.04
|
|
|
1.1
|
%
|
|
132.57
|
|
|
130.64
|
|
|
1.5
|
%
|
||||
Marriott (No. 5)
|
|
1
|
|
|
356
|
|
|
272.72
|
|
|
254.86
|
|
|
7.0
|
%
|
|
268.89
|
|
|
253.20
|
|
|
6.2
|
%
|
||||
Subtotal / Average Marriott
|
|
122
|
|
|
17,086
|
|
|
136.08
|
|
|
135.98
|
|
|
0.1
|
%
|
|
135.65
|
|
|
134.82
|
|
|
0.6
|
%
|
||||
InterContinental
(1)
|
|
99
|
|
|
16,237
|
|
|
120.63
|
|
|
120.77
|
|
|
(0.1
|
%)
|
|
119.81
|
|
|
119.55
|
|
|
0.2
|
%
|
||||
Sonesta
(1)
|
|
49
|
|
|
8,371
|
|
|
138.29
|
|
|
140.34
|
|
|
(1.5
|
%)
|
|
140.06
|
|
|
139.70
|
|
|
0.3
|
%
|
||||
Wyndham
|
|
22
|
|
|
3,579
|
|
|
104.90
|
|
|
102.00
|
|
|
2.8
|
%
|
|
100.81
|
|
|
99.18
|
|
|
1.6
|
%
|
||||
Hyatt
|
|
22
|
|
|
2,724
|
|
|
108.48
|
|
|
108.31
|
|
|
0.2
|
%
|
|
110.09
|
|
|
109.73
|
|
|
0.3
|
%
|
||||
Carlson
(1)
|
|
8
|
|
|
1,579
|
|
|
130.51
|
|
|
125.47
|
|
|
4.0
|
%
|
|
126.52
|
|
|
120.66
|
|
|
4.9
|
%
|
||||
Morgans
|
|
1
|
|
|
372
|
|
|
259.71
|
|
|
271.14
|
|
|
(4.2
|
%)
|
|
262.86
|
|
|
269.78
|
|
|
(2.6
|
%)
|
||||
All Hotels Total / Average
|
|
323
|
|
|
49,948
|
|
|
$
|
128.27
|
|
|
$
|
128.43
|
|
|
(0.1
|
%)
|
|
$
|
127.87
|
|
|
$
|
127.26
|
|
|
0.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
OCCUPANCY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Marriott (No. 1)
|
|
53
|
|
|
7,610
|
|
|
74.2
|
%
|
|
74.7
|
%
|
|
-0.5 pts
|
|
|
70.5
|
%
|
|
72.1
|
%
|
|
-1.6 pts
|
|
||||
Marriott (No. 234)
|
|
68
|
|
|
9,120
|
|
|
77.4
|
%
|
|
78.8
|
%
|
|
-1.4 pts
|
|
|
76.8
|
%
|
|
77.8
|
%
|
|
-1.0 pts
|
|
||||
Marriott (No. 5)
|
|
1
|
|
|
356
|
|
|
90.4
|
%
|
|
91.8
|
%
|
|
-1.4 pts
|
|
|
88.7
|
%
|
|
88.6
|
%
|
|
0.1 pts
|
|
||||
Subtotal / Average Marriott
|
|
122
|
|
|
17,086
|
|
|
76.3
|
%
|
|
77.2
|
%
|
|
-0.9 pts
|
|
|
74.2
|
%
|
|
75.5
|
%
|
|
-1.3 pts
|
|
||||
InterContinental
(1)
|
|
99
|
|
|
16,237
|
|
|
84.9
|
%
|
|
86.0
|
%
|
|
-1.1 pts
|
|
|
82.3
|
%
|
|
82.8
|
%
|
|
-0.5 pts
|
|
||||
Sonesta
(1)
|
|
49
|
|
|
8,371
|
|
|
74.7
|
%
|
|
75.0
|
%
|
|
-0.3 pts
|
|
|
71.7
|
%
|
|
70.3
|
%
|
|
1.4 pts
|
|
||||
Wyndham
|
|
22
|
|
|
3,579
|
|
|
75.4
|
%
|
|
77.2
|
%
|
|
-1.8 pts
|
|
|
71.6
|
%
|
|
73.9
|
%
|
|
-2.3 pts
|
|
||||
Hyatt
|
|
22
|
|
|
2,724
|
|
|
84.4
|
%
|
|
82.7
|
%
|
|
1.7 pts
|
|
|
83.5
|
%
|
|
82.2
|
%
|
|
1.3 pts
|
|
||||
Carlson
(1)
|
|
8
|
|
|
1,579
|
|
|
79.3
|
%
|
|
82.4
|
%
|
|
-3.1 pts
|
|
|
76.2
|
%
|
|
77.3
|
%
|
|
-1.1 pts
|
|
||||
Morgans
|
|
1
|
|
|
372
|
|
|
92.2
|
%
|
|
94.3
|
%
|
|
-2.1 pts
|
|
|
89.1
|
%
|
|
94.2
|
%
|
|
-5.1 pts
|
|
||||
All Hotels Total / Average
|
|
323
|
|
|
49,948
|
|
|
79.4
|
%
|
|
80.2
|
%
|
|
-0.8 pts
|
|
|
76.9
|
%
|
|
77.4
|
%
|
|
-0.5 pts
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
RevPAR
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Marriott (No. 1)
|
|
53
|
|
|
7,610
|
|
|
$
|
97.60
|
|
|
$
|
100.19
|
|
|
(2.6
|
%)
|
|
$
|
92.93
|
|
|
$
|
96.20
|
|
|
(3.4
|
%)
|
Marriott (No. 234)
|
|
68
|
|
|
9,120
|
|
|
103.31
|
|
|
104.05
|
|
|
(0.7
|
%)
|
|
101.81
|
|
|
101.64
|
|
|
0.2
|
%
|
||||
Marriott (No. 5)
|
|
1
|
|
|
356
|
|
|
246.54
|
|
|
233.96
|
|
|
5.4
|
%
|
|
238.51
|
|
|
224.34
|
|
|
6.3
|
%
|
||||
Subtotal / Average Marriott
|
|
122
|
|
|
17,086
|
|
|
103.83
|
|
|
104.98
|
|
|
(1.1
|
%)
|
|
100.65
|
|
|
101.79
|
|
|
(1.1
|
%)
|
||||
InterContinental
(1)
|
|
99
|
|
|
16,237
|
|
|
102.41
|
|
|
103.86
|
|
|
(1.4
|
%)
|
|
98.60
|
|
|
98.99
|
|
|
(0.4
|
%)
|
||||
Sonesta
(1)
|
|
49
|
|
|
8,371
|
|
|
103.30
|
|
|
105.26
|
|
|
(1.9
|
%)
|
|
100.42
|
|
|
98.21
|
|
|
2.3
|
%
|
||||
Wyndham
|
|
22
|
|
|
3,579
|
|
|
79.09
|
|
|
78.74
|
|
|
0.4
|
%
|
|
72.18
|
|
|
73.29
|
|
|
(1.5
|
%)
|
||||
Hyatt
|
|
22
|
|
|
2,724
|
|
|
91.56
|
|
|
89.57
|
|
|
2.2
|
%
|
|
91.93
|
|
|
90.20
|
|
|
1.9
|
%
|
||||
Carlson
(1)
|
|
8
|
|
|
1,579
|
|
|
103.49
|
|
|
103.39
|
|
|
0.1
|
%
|
|
96.41
|
|
|
93.27
|
|
|
3.4
|
%
|
||||
Morgans
|
|
1
|
|
|
372
|
|
|
239.45
|
|
|
255.69
|
|
|
(6.4
|
%)
|
|
234.21
|
|
|
254.13
|
|
|
(7.8
|
%)
|
||||
All Hotels Total / Average
|
|
323
|
|
|
49,948
|
|
|
$
|
101.85
|
|
|
$
|
103.00
|
|
|
(1.1
|
%)
|
|
$
|
98.33
|
|
|
$
|
98.50
|
|
|
(0.2
|
%)
|
(1)
|
Operating data includes data for periods prior to our ownership of certain hotels and excludes data for periods prior to our sale of certain hotels.
|
|
|
|
For the Three Months Ended September 30,
|
|
For the Nine Months Ended September 30,
|
||||||||||||
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Net income available for common shareholders
|
|
$
|
85,728
|
|
|
$
|
46,646
|
|
|
$
|
172,270
|
|
|
$
|
144,426
|
|
|
Add (less):
|
Depreciation and amortization expense
|
|
98,205
|
|
|
90,139
|
|
|
286,811
|
|
|
266,192
|
|
||||
|
Gain on sale of real estate
(1)
|
|
(9,348
|
)
|
|
—
|
|
|
(9,348
|
)
|
|
—
|
|
||||
FFO available for common shareholders
|
|
174,585
|
|
|
136,785
|
|
|
449,733
|
|
|
410,618
|
|
|||||
Add:
|
Acquisition related costs
(2)
|
|
—
|
|
|
156
|
|
|
—
|
|
|
885
|
|
||||
|
Estimated business management incentive fees
(3)
|
|
873
|
|
|
25,036
|
|
|
38,243
|
|
|
56,272
|
|
||||
|
Loss on early extinguishment of debt
(4)
|
|
—
|
|
|
158
|
|
|
—
|
|
|
228
|
|
||||
|
Excess of liquidation preference over carrying value of preferred shares redeemed
(5)
|
|
—
|
|
|
—
|
|
|
9,893
|
|
|
—
|
|
||||
Normalized FFO available for common shareholders
|
|
$
|
175,458
|
|
|
$
|
162,135
|
|
|
$
|
497,869
|
|
|
$
|
468,003
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Weighted average shares outstanding (basic)
|
|
164,149
|
|
|
157,217
|
|
|
164,131
|
|
|
153,357
|
|
||||
|
Weighted average shares outstanding (diluted)
(6)
|
|
164,188
|
|
|
157,263
|
|
|
164,168
|
|
|
153,390
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||||||
Basic and diluted per common share amounts:
|
|
|
|
|
|
|
|
|
|||||||||
|
Net income available for common shareholders
|
|
$
|
0.52
|
|
|
$
|
0.30
|
|
|
$
|
1.05
|
|
|
$
|
0.94
|
|
|
FFO available for common shareholders
|
|
$
|
1.06
|
|
|
$
|
0.87
|
|
|
$
|
2.74
|
|
|
$
|
2.68
|
|
|
Normalized FFO available for common shareholders
|
|
$
|
1.07
|
|
|
$
|
1.03
|
|
|
$
|
3.03
|
|
|
$
|
3.05
|
|
|
Distributions declared per share
|
|
$
|
0.52
|
|
|
$
|
0.51
|
|
|
$
|
1.55
|
|
|
$
|
1.52
|
|
(1)
|
We recorded a $9,348 gain on sale of real estate during the three months ended September 30, 2017 in connection with the sale of three hotels.
|
(2)
|
Represents costs associated with our acquisition activities. Acquisition costs incurred during the 2017 periods have been capitalized in purchase accounting pursuant to a change in GAAP.
|
(3)
|
Estimated incentive fees under our business management agreement calculated based on common share total return, as defined, are included in general and administrative expense in our condensed consolidated statements of comprehensive income. In calculating net income in accordance with GAAP, we recognize estimated business management incentive fee expense, if any, each quarter. Although we recognize this expense, if any, each quarter for purposes of calculating net income, we do not include these amounts in the calculation of Normalized FFO available for common shareholders until the fourth quarter, which is when the expense amount for the year is determined. Incentive fees for
2017
, if any, will be paid in cash in January
2018
.
|
(4)
|
We recorded losses of $158 and $228 on early extinguishment of debt during the three and nine months ended September 30, 2016, respectively, in connection with the redemption of certain senior unsecured notes.
|
(5)
|
In February 2017, we redeemed all 11,600,000 of our outstanding
7.125%
Series D cumulative redeemable preferred shares at the stated liquidation preference of
$25.00
per share plus accrued and unpaid distributions to the date of redemption. The liquidation preference of the redeemed shares exceeded the carrying amount for the redeemed shares as of the date of redemption by
$9,893
and we reduced net income available for common shareholders in the nine months ended September 30, 2017 by that excess amount.
|
(6)
|
Represents weighted average common shares adjusted to reflect the potential dilution of unvested share awards.
|
Principal Balance
|
|
Annual Interest
Rate
|
|
Annual Interest
Expense
|
|
Maturity
|
|
Interest Payments
Due
|
|||||
$
|
350,000
|
|
|
6.700
|
%
|
(1)
|
$
|
23,450
|
|
|
2018
|
|
Semi-Annually
|
400,000
|
|
|
4.250
|
%
|
|
17,000
|
|
|
2021
|
|
Semi-Annually
|
||
500,000
|
|
|
5.000
|
%
|
|
25,000
|
|
|
2022
|
|
Semi-Annually
|
||
500,000
|
|
|
4.500
|
%
|
|
22,500
|
|
|
2023
|
|
Semi-Annually
|
||
350,000
|
|
|
4.650
|
%
|
|
16,275
|
|
|
2024
|
|
Semi-Annually
|
||
350,000
|
|
|
4.500
|
%
|
|
15,750
|
|
|
2025
|
|
Semi-Annually
|
||
350,000
|
|
|
5.250
|
%
|
|
18,375
|
|
|
2026
|
|
Semi-Annually
|
||
400,000
|
|
|
4.950
|
%
|
|
19,800
|
|
|
2027
|
|
Semi-Annually
|
||
$
|
3,200,000
|
|
|
|
|
|
$
|
158,150
|
|
|
|
|
|
|
|
Impact of Increase in Interest Rates
|
|
|
|||||||||||
|
|
Interest Rate
Per Year
(1)
|
|
Outstanding
Debt
|
|
Total Interest
Expense Per Year
|
|
Annual Per Common
Share Impact
(2)
|
|||||||
At September 30, 2017
|
|
2.38
|
%
|
|
$
|
858,000
|
|
|
$
|
20,420
|
|
|
$
|
0.12
|
|
100 basis point increase
|
|
3.38
|
%
|
|
$
|
858,000
|
|
|
$
|
29,000
|
|
|
$
|
0.18
|
|
|
|
Impact of Increase in Interest Rates
|
|
|
|||||||||||
|
|
Interest Rate
Per Year
(1)
|
|
Outstanding
Debt
|
|
Total Interest
Expense Per Year
|
|
Annual Per Common
Share Impact
(2)
|
|||||||
At September 30, 2017
|
|
2.36
|
%
|
|
$
|
1,400,000
|
|
|
$
|
33,040
|
|
|
$
|
0.20
|
|
100 basis point increase
|
|
3.36
|
%
|
|
$
|
1,400,000
|
|
|
$
|
47,040
|
|
|
$
|
0.29
|
|
(1)
|
Weighted average based on the interest rates and the respective outstanding borrowings (assuming fully drawn) as of
September 30, 2017
.
|
(2)
|
Based on diluted weighted average common shares outstanding for the
nine
months ended
September 30, 2017
.
|
•
|
OUR HOTEL MANAGERS’ OR TENANTS’ ABILITIES TO PAY THE CONTRACTUAL AMOUNTS OF RETURNS OR RENTS DUE TO US,
|
•
|
OUR ABILITY TO COMPETE FOR ACQUISITIONS EFFECTIVELY,
|
•
|
OUR POLICIES AND PLANS REGARDING INVESTMENTS, FINANCINGS AND DISPOSITIONS,
|
•
|
OUR ABILITY TO PAY DISTRIBUTIONS TO OUR SHAREHOLDERS AND THE AMOUNT OF SUCH DISTRIBUTIONS,
|
•
|
OUR ABILITY TO RAISE DEBT OR EQUITY CAPITAL,
|
•
|
OUR ABILITY TO APPROPRIATELY BALANCE OUR USE OF DEBT AND EQUITY CAPITAL,
|
•
|
OUR INTENT TO MAKE IMPROVEMENTS TO CERTAIN OF OUR PROPERTIES AND THE SUCCESS OF OUR HOTEL RENOVATIONS TO IMPROVE OUR HOTELS' RATES AND OCCUPANCIES,
|
•
|
OUR ABILITY TO ENGAGE AND RETAIN QUALIFIED MANAGERS AND TENANTS FOR OUR HOTELS AND TRAVEL CENTERS ON SATISFACTORY TERMS,
|
•
|
THE FUTURE AVAILABILITY OF BORROWINGS UNDER OUR REVOLVING CREDIT FACILITY,
|
•
|
OUR ABILITY TO PAY INTEREST ON AND PRINCIPAL OF OUR DEBT,
|
•
|
OUR CREDIT RATINGS,
|
•
|
THE ABILITY OF TA TO PAY CURRENT AND DEFERRED RENT AMOUNTS AND OTHER OBLIGATIONS DUE TO US,
|
•
|
OUR EXPECTATION THAT WE BENEFIT FROM OUR OWNERSHIP OF RMR INC.,
|
•
|
OUR EXPECTATION THAT WE BENEFIT FROM OUR OWNERSHIP OF AIC AND FROM OUR PARTICIPATION IN INSURANCE PROGRAMS ARRANGED BY AIC,
|
•
|
OUR QUALIFICATION FOR TAXATION AS A REIT, AND
|
•
|
OTHER MATTERS.
|
•
|
THE IMPACT OF CONDITIONS AND CHANGES IN THE ECONOMY AND THE CAPITAL MARKETS ON US AND OUR MANAGERS AND TENANTS,
|
•
|
COMPETITION WITHIN THE REAL ESTATE, HOTEL, TRANSPORTATION AND TRAVEL CENTER INDUSTRIES, PARTICULARLY IN THOSE MARKETS IN WHICH OUR PROPERTIES ARE LOCATED,
|
•
|
COMPLIANCE WITH, AND CHANGES TO, FEDERAL, STATE AND LOCAL LAWS AND REGULATIONS AFFECTING THE REAL ESTATE, HOTEL, TRANSPORTATION AND TRAVEL CENTER INDUSTRIES, ACCOUNTING RULES, TAX LAWS AND SIMILAR MATTERS,
|
•
|
LIMITATIONS IMPOSED ON OUR BUSINESS AND OUR ABILITY TO SATISFY COMPLEX RULES IN ORDER FOR US TO QUALIFY FOR TAXATION AS A REIT FOR U.S. FEDERAL INCOME TAX PURPOSES,
|
•
|
ACTS OF TERRORISM, OUTBREAKS OF SO CALLED PANDEMICS OR OTHER MANMADE OR NATURAL DISASTERS BEYOND OUR CONTROL, AND
|
•
|
ACTUAL AND POTENTIAL CONFLICTS OF INTEREST WITH OUR RELATED PARTIES, INCLUDING OUR MANAGING TRUSTEES, TA, SONESTA, RMR INC., RMR LLC, AIC AND OTHERS AFFILIATED WITH THEM.
|
•
|
OUR ABILITY TO MAKE FUTURE DISTRIBUTIONS TO OUR SHAREHOLDERS AND TO MAKE PAYMENTS OF PRINCIPAL AND INTEREST ON OUR INDEBTEDNESS DEPENDS UPON A NUMBER OF FACTORS, INCLUDING OUR FUTURE EARNINGS, THE CAPITAL COSTS WE INCUR TO MAINTAIN OUR PROPERTIES AND OUR WORKING CAPITAL REQUIREMENTS. WE MAY BE UNABLE TO PAY OUR DEBT OBLIGATIONS OR TO MAINTAIN OUR CURRENT RATE OF DISTRIBUTIONS ON OUR COMMON SHARES AND FUTURE DISTRIBUTIONS MAY BE REDUCED OR ELIMINATED,
|
•
|
THE SECURITY DEPOSITS WHICH WE HOLD ARE NOT IN SEGREGATED CASH ACCOUNTS OR OTHERWISE SEPARATE FROM OUR OTHER ASSETS AND LIABILITIES. ACCORDINGLY, WHEN WE RECORD INCOME BY REDUCING OUR SECURITY DEPOSIT LIABILITIES, WE DO NOT RECEIVE ANY ADDITIONAL CASH PAYMENT. BECAUSE WE DO NOT RECEIVE ANY ADDITIONAL CASH PAYMENT AS WE APPLY SECURITY DEPOSITS TO COVER PAYMENT SHORTFALLS, THE FAILURE OF OUR MANAGERS OR TENANTS TO PAY MINIMUM RETURNS OR RENTS DUE TO US MAY REDUCE OUR CASH FLOWS AND OUR ABILITY TO PAY DISTRIBUTIONS TO SHAREHOLDERS,
|
•
|
AS OF
SEPTEMBER 30, 2017
, APPROXIMATELY
78%
OF OUR AGGREGATE ANNUAL MINIMUM RETURNS AND RENTS WERE SECURED BY GUARANTEES OR SECURITY DEPOSITS FROM OUR MANAGERS AND TENANTS. THIS MAY IMPLY THAT THESE MINIMUM RETURNS AND RENTS WILL BE PAID. IN FACT, CERTAIN OF THESE GUARANTEES AND SECURITY DEPOSITS ARE LIMITED IN AMOUNT AND DURATION AND ALL THE GUARANTEES ARE SUBJECT TO THE GUARANTORS’ ABILITIES AND WILLINGNESS TO PAY. FURTHER, WYNDHAM'S GUARANTEE OF THE MINIMUM RETURNS DUE FROM OUR HOTELS THAT ARE MANAGED BY WYNDHAM WAS DEPLETED AS OF SEPTEMBER 30, 2017. WE DO NOT KNOW WHETHER WYNDHAM WILL CONTINUE TO PAY THE MINIMUM RETURNS DUE TO US DESPITE THE DEPLETED GUARANTEE OR IF WYNDHAM WILL DEFAULT ON ITS PAYMENTS. THE BALANCE OF OUR ANNUAL MINIMUM RETURNS AND RENTS AS OF
SEPTEMBER 30, 2017
WAS NOT GUARANTEED NOR DO WE HOLD A SECURITY DEPOSIT WITH RESPECT TO THOSE AMOUNTS. WE CANNOT BE SURE OF THE FUTURE FINANCIAL PERFORMANCE OF OUR PROPERTIES AND WHETHER SUCH PERFORMANCE WILL COVER OUR MINIMUM RETURNS AND RENTS, WHETHER THE GUARANTEES OR SECURITY DEPOSITS WILL BE ADEQUATE TO COVER FUTURE SHORTFALLS IN THE MINIMUM RETURNS OR RENTS DUE TO US WHICH THEY GUARANTY OR SECURE, OR REGARDING OUR MANAGERS’, TENANTS’ OR GUARANTORS’ FUTURE ACTIONS IF
|
•
|
WE HAVE RECENTLY RENOVATED CERTAIN HOTELS AND ARE CURRENTLY RENOVATING ADDITIONAL HOTELS. WE CURRENTLY EXPECT TO FUND APPROXIMATELY
$32.5
MILLION DURING THE REMAINDER OF 2017 AND AN AGGREGATE OF APPROXIMATELY
$174.0
MILLION IN 2018 AND 2019 FOR RENOVATIONS AND OTHER CAPITAL IMPROVEMENT COSTS AT CERTAIN OF OUR HOTELS AND THESE AMOUNTS WILL INCREASE IF AND AS WE CONCLUDE OUR PENDING AND OTHER ACQUISITIONS. THE COST OF CAPITAL PROJECTS ASSOCIATED WITH SUCH RENOVATIONS MAY BE GREATER THAN WE NOW ANTICIPATE. OPERATING RESULTS AT OUR HOTELS MAY DECLINE AS A RESULT OF HAVING ROOMS OUT OF SERVICE OR OTHER DISRUPTIONS DURING RENOVATIONS. ALSO, WHILE OUR FUNDING OF THESE CAPITAL PROJECTS WILL CAUSE OUR CONTRACTUAL MINIMUM RETURNS TO INCREASE, THE HOTELS’ OPERATING RESULTS MAY NOT INCREASE OR MAY NOT INCREASE TO THE EXTENT THAT THE MINIMUM RETURNS INCREASE. ACCORDINGLY, COVERAGE OF OUR MINIMUM RETURNS AT THESE HOTELS MAY REMAIN DEPRESSED FOR AN EXTENDED PERIOD,
|
•
|
WE EXPECT TO PURCHASE FROM TA DURING THE REMAINDER OF 2017 APPROXIMATELY
$16.1
MILLION OF CAPITAL IMPROVEMENTS TA EXPECTS TO MAKE TO THE TRAVEL CENTERS WE LEASE TO TA. PURSUANT TO THE TERMS OF THE APPLICABLE LEASES, THE ANNUAL RENT PAYABLE TO US BY TA WILL INCREASE AS A RESULT OF ANY SUCH PURCHASES. WE MAY ULTIMATELY PURCHASE MORE OR LESS THAN THIS BUDGETED AMOUNT. TA MAY NOT REALIZE RESULTS FROM ANY OF THESE CAPITAL IMPROVEMENTS WHICH EQUAL OR EXCEED THE INCREASED ANNUAL RENTS IT WILL BE OBLIGATED TO PAY TO US, WHICH COULD INCREASE THE RISK OF TA BEING UNABLE TO PAY AMOUNTS DUE TO US,
|
•
|
HOTEL ROOM DEMAND AND TRUCKING ACTIVITY ARE OFTEN REFLECTIONS OF THE GENERAL ECONOMIC ACTIVITY IN THE COUNTRY AND IN THE GEOGRAPHIC AREAS WHERE OUR PROPERTIES ARE LOCATED. IF ECONOMIC ACTIVITY IN THE COUNTRY DECLINES, HOTEL ROOM DEMAND AND TRUCKING ACTIVITY MAY DECLINE AND THE OPERATING RESULTS OF OUR HOTELS AND TRAVEL CENTERS MAY DECLINE, THE FINANCIAL RESULTS OF OUR HOTEL MANAGERS AND OUR TENANTS, INCLUDING TA, MAY SUFFER AND THESE MANAGERS AND TENANTS MAY BE UNABLE TO PAY OUR RETURNS OR RENTS. ALSO, DEPRESSED OPERATING RESULTS FROM OUR PROPERTIES FOR EXTENDED PERIODS MAY RESULT IN THE OPERATORS OF SOME OR ALL OF OUR HOTELS AND OUR TRAVEL CENTERS BECOMING UNABLE OR UNWILLING TO MEET THEIR OBLIGATIONS OR THEIR GUARANTEES AND SECURITY DEPOSITS WE HOLD MAY BE EXHAUSTED,
|
•
|
HOTEL AND OTHER COMPETITIVE FORMS OF TRAVEL LODGING SUPPLY GROWTH HAS BEEN INCREASING AND MAY AFFECT OUR HOTEL OPERATORS' ABILITY TO GROW ADR AND OCCUPANCY, AND ADR AND OCCUPANCY COULD DECLINE DUE TO INCREASED COMPETITION WHICH MAY CAUSE OUR HOTEL OPERATORS TO BECOME UNABLE TO PAY OUR RETURNS OR RENTS,
|
•
|
IF THE CURRENT LEVEL OF COMMERCIAL ACTIVITY IN THE COUNTRY DECLINES, IF THE PRICE OF DIESEL FUEL INCREASES SIGNIFICANTLY, IF FUEL CONSERVATION MEASURES ARE INCREASED, IF FREIGHT BUSINESS IS DIRECTED AWAY FROM TRUCKING, IF TA IS UNABLE TO EFFECTIVELY COMPETE OR OPERATE ITS BUSINESS, IF FUEL EFFICIENCIES, THE USE OF ALTERNATIVE FUELS OR TRANSPORTATION TECHNOLOGIES REDUCE THE DEMAND FOR PRODUCTS AND SERVICES TA SELLS OR FOR VARIOUS OTHER REASONS, TA MAY BECOME UNABLE TO PAY CURRENT AND DEFERRED RENTS DUE TO US,
|
•
|
OUR ABILITY TO GROW OUR BUSINESS AND INCREASE OUR DISTRIBUTIONS DEPENDS IN LARGE PART UPON OUR ABILITY TO BUY PROPERTIES THAT GENERATE RETURNS OR CAN BE LEASED FOR RENTS WHICH EXCEED THEIR OPERATING AND CAPITAL COSTS. WE MAY BE UNABLE TO IDENTIFY PROPERTIES THAT WE WANT TO ACQUIRE OR TO NEGOTIATE ACCEPTABLE PURCHASE PRICES, ACQUISITION FINANCING, MANAGEMENT CONTRACTS OR LEASE TERMS FOR NEW PROPERTIES,
|
•
|
CONTINGENCIES IN OUR ACQUISITION AND SALE AGREEMENTS MAY NOT BE SATISFIED AND OUR PENDING ACQUISITIONS AND SALES AND ANY RELATED MANAGEMENT ARRANGEMENTS WE EXPECT TO ENTER MAY NOT OCCUR, MAY BE DELAYED OR THE TERMS OF SUCH TRANSACTIONS OR ARRANGEMENTS MAY CHANGE,
|
•
|
AT
SEPTEMBER 30, 2017
, WE HAD
$14.5
MILLION OF CASH AND CASH EQUIVALENTS,
$542.0
MILLION AVAILABLE UNDER OUR
$1.0
BILLION REVOLVING CREDIT FACILITY AND SECURITY DEPOSITS AND GUARANTEES COVERING SOME OF OUR MINIMUM RETURNS AND RENTS. THESE STATEMENTS MAY IMPLY THAT WE HAVE ABUNDANT WORKING CAPITAL AND LIQUIDITY. HOWEVER, OUR MANAGERS AND TENANTS MAY NOT BE ABLE TO FUND MINIMUM RETURNS AND RENTS DUE TO US FROM OPERATING OUR PROPERTIES OR FROM OTHER RESOURCES; IN THE PAST AND CURRENTLY, CERTAIN OF OUR TENANTS AND HOTEL MANAGERS HAVE IN FACT NOT PAID THE MINIMUM AMOUNTS DUE TO US FROM THEIR OPERATIONS OF OUR LEASED OR MANAGED PROPERTIES. ALSO, CERTAIN OF THE SECURITY DEPOSITS AND GUARANTEES WE HAVE TO COVER ANY SUCH SHORTFALLS ARE LIMITED IN AMOUNT AND DURATION, AND ANY SECURITY DEPOSITS WE APPLY FOR SUCH SHORTFALLS DO NOT RESULT IN ADDITIONAL CASH FLOWS TO US. OUR PROPERTIES REQUIRE, AND WE HAVE AGREED TO PROVIDE, SIGNIFICANT FUNDING FOR CAPITAL IMPROVEMENTS, RENOVATIONS AND OTHER MATTERS. ACCORDINGLY, WE MAY NOT HAVE SUFFICIENT WORKING CAPITAL OR LIQUIDITY,
|
•
|
WE MAY BE UNABLE TO REPAY OUR DEBT OBLIGATIONS WHEN THEY BECOME DUE,
|
•
|
CONTINUED AVAILABILITY OF BORROWINGS UNDER OUR REVOLVING CREDIT FACILITY IS SUBJECT TO OUR SATISFYING CERTAIN FINANCIAL COVENANTS AND OTHER CREDIT FACILITY CONDITIONS THAT WE MAY BE UNABLE TO SATISFY,
|
•
|
ACTUAL COSTS UNDER OUR REVOLVING CREDIT FACILITY OR OTHER FLOATING RATE DEBT WILL BE HIGHER THAN LIBOR PLUS A PREMIUM BECAUSE OF FEES AND EXPENSES ASSOCIATED WITH SUCH FACILITIES,
|
•
|
THE MAXIMUM BORROWING AVAILABILITY UNDER OUR REVOLVING CREDIT FACILITY AND TERM LOAN MAY BE INCREASED TO UP TO
$2.3
BILLION ON A COMBINED BASIS IN CERTAIN CIRCUMSTANCES; HOWEVER, INCREASING THE MAXIMUM BORROWING AVAILABILITY UNDER OUR REVOLVING CREDIT FACILITY AND TERM LOAN IS SUBJECT TO OUR OBTAINING ADDITIONAL COMMITMENTS FROM LENDERS, WHICH MAY NOT OCCUR,
|
•
|
THE PREMIUMS USED TO DETERMINE THE INTEREST RATE PAYABLE ON OUR REVOLVING CREDIT FACILITY AND TERM LOAN AND THE FACILITY FEE PAYABLE ON OUR REVOLVING CREDIT FACILITY ARE BASED ON OUR CREDIT RATINGS. FUTURE CHANGES IN OUR CREDIT RATINGS MAY CAUSE THE INTEREST AND FEES WE PAY TO INCREASE,
|
•
|
WE HAVE THE OPTION TO EXTEND THE MATURITY DATE OF OUR REVOLVING CREDIT FACILITY UPON PAYMENT OF A FEE AND MEETING OTHER CONDITIONS; HOWEVER, THE APPLICABLE CONDITIONS MAY NOT BE MET,
|
•
|
THE BUSINESS AND PROPERTY MANAGEMENT AGREEMENTS BETWEEN US AND RMR LLC HAVE CONTINUING 20 YEAR TERMS. HOWEVER, THOSE AGREEMENTS PERMIT EARLY TERMINATION IN CERTAIN CIRCUMSTANCES. ACCORDINGLY, WE CANNOT BE SURE THAT THESE AGREEMENTS WILL REMAIN IN EFFECT FOR CONTINUING 20 YEAR TERMS,
|
•
|
WE BELIEVE THAT OUR RELATIONSHIPS WITH OUR RELATED PARTIES, INCLUDING RMR LLC, RMR INC., TA, SONESTA, AIC AND OTHERS AFFILIATED WITH THEM MAY BENEFIT US AND PROVIDE US WITH COMPETITIVE ADVANTAGES IN OPERATING AND GROWING OUR BUSINESS. HOWEVER, THE ADVANTAGES WE BELIEVE WE MAY REALIZE FROM THESE RELATIONSHIPS MAY NOT MATERIALIZE,
|
•
|
RMR INC. MAY REDUCE THE AMOUNT OF ITS DISTRIBUTIONS TO ITS SHAREHOLDERS, INCLUDING US,
|
•
|
MARRIOTT HAS NOTIFIED US THAT IT DOES NOT INTEND TO EXTEND ITS LEASE FOR OUR RESORT HOTEL ON KAUAI, HAWAII WHEN THAT LEASE EXPIRES ON DECEMBER 31, 2019 AND WE INTEND TO HAVE DISCUSSIONS WITH MARRIOTT ABOUT THE FUTURE OF THIS HOTEL. THESE STATEMENTS MAY IMPLY THAT MARRIOTT WILL NOT OPERATE THIS HOTEL IN THE FUTURE OR THAT WE MAY RECEIVE LESS CASH FLOW FROM THIS HOTEL IN THE FUTURE. OUR DISCUSSIONS WITH MARRIOTT HAVE ONLY RECENTLY BEGUN. AT THIS TIME WE CANNOT PREDICT HOW OUR DISCUSSIONS WITH
|
•
|
WE HAVE ADVISED MORGANS THAT THE CLOSING OF ITS MERGER WITH SBE WAS IN VIOLATION OF OUR AGREEMENT WITH MORGANS, WE HAVE FILED AN ACTION FOR UNLAWFUL DETAINER AGAINST MORGANS AND SBE TO COMPEL MORGANS AND SBE TO SURRENDER POSSESSION OF THE SAN FRANCISCO HOTEL WHICH MORGANS HISTORICALLY LEASED FROM US, AND WE ARE IN DISCUSSIONS WITH MORGANS AND SBE REGARDING THIS MATTER. THE OUTCOME OF THIS PENDING LITIGATION AND OF OUR DISCUSSIONS WITH MORGANS AND SBE IS NOT ASSURED, BUT WE BELIEVE THAT MORGANS MAY SURRENDER POSSESSION OF THIS HOTEL OR THAT THE COURT WILL DETERMINE THAT MORGANS AND SBE HAVE BREACHED THE HISTORICAL LEASE. WE ALSO BELIEVE THAT THIS HOTEL MAY REQUIRE SUBSTANTIAL CAPITAL INVESTMENT TO REMAIN COMPETITIVE IN ITS MARKET. THE CONTINUATION OF OUR DISPUTE WITH MORGANS AND SBE REQUIRES US TO EXPEND LEGAL FEES AND THE RESULT OF THIS DISPUTE MAY CAUSE US SOME LOSS OF RENT, AT LEAST UNTIL THIS HOTEL MAY BE RENOVATED AND OPERATIONS IMPROVE. LITIGATION AND DISPUTES WITH TENANTS OFTEN PRODUCE UNEXPECTED RESULTS AND WE CAN PROVIDE NO ASSURANCE REGARDING THE RESULTS OF THIS DISPUTE.
|
|
|
|
|
|
|
|
|
|
|
|
Maximum
|
|
|
|
|
|
|
|
|
Total Number of
|
|
|
Approximate Dollar
|
|
|
|
|
|
|
|
|
Shares Purchased
|
|
|
Value of Shares that
|
|
|
Number of
|
|
|
|
|
|
as Part of Publicly
|
|
|
May Yet Be Purchased
|
|
|
Shares
|
|
Average Price
|
|
|
Announced Plans
|
|
|
Under the Plans or
|
|
Calendar Month
|
|
Purchased
(1)
|
|
Paid per Share
|
|
or Programs
|
|
Programs
|
|||
September 2017
|
|
18,559
|
|
$
|
27.98
|
|
$
|
—
|
|
$
|
—
|
Total
|
|
18,559
|
|
$
|
27.98
|
|
$
|
—
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
These common share withholdings and purchases were made to satisfy the tax withholding and payment obligations of certain of our officers and other RMR LLC employees in connection with the vesting of awards of our common shares. We withheld and purchased these shares at their fair market value based upon the trading price of our common shares at the close of trading on Nasdaq on the purchase date.
|
Exhibit
Number
|
|
Description
|
|
3.1
|
|
|
|
3.2
|
|
|
|
4.1
|
|
|
|
4.2
|
|
|
|
4.3
|
|
|
|
4.4
|
|
|
|
4.5
|
|
|
|
4.6
|
|
|
|
4.7
|
|
|
4.8
|
|
|
|
4.9
|
|
|
|
4.10
|
|
|
|
4.11
|
|
|
|
4.12
|
|
|
|
4.13
|
|
|
|
10.1
|
|
|
|
10.2
|
|
|
Representative Form of Management Agreement between Sonesta International Hotels Corporation and Cambridge TRS, Inc. (limited service). (Incorporated by reference to the Company’s Quarterly Report on Form 10-Q/A, Amendment No. 2, for the quarter ended June 30, 2012.)
(Schedule of applicable agreements filed herewith.)
|
10.3
|
|
|
|
10.4
|
|
|
|
12.1
|
|
|
|
12.2
|
|
|
|
31.1
|
|
|
|
31.2
|
|
|
|
31.3
|
|
|
|
31.4
|
|
|
|
32.1
|
|
|
|
101.1
|
|
|
The following materials from the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2017 formatted in XBRL (eXtensible Business Reporting Language): (i) the Condensed Consolidated Balance Sheets, (ii) the Condensed Consolidated Statements of Comprehensive Income, (iii) the Condensed Consolidated Statements of Cash Flows and (iv) related notes to these financial statements, tagged as blocks of text and in detail. (Filed herewith.)
|
|
|
|
HOSPITALITY PROPERTIES TRUST
|
|
|
|
|
|
/s/ John G. Murray
|
|
John G. Murray
|
|
President and Chief Operating Officer
|
|
Dated: November 8, 2017
|
|
|
|
|
|
/s/ Mark L. Kleifges
|
|
Mark L. Kleifges
|
|
Chief Financial Officer and Treasurer
|
|
(Principal Financial and Accounting Officer)
|
|
Dated: November 8, 2017
|
By:_
/s/ Mark L. Kleifges
___________
|
Name: Mark L. Kleifges Title: Chief Financial Officer and Treasurer |
|
Owner
|
|
Hotel
|
|
Landlord
|
|
Date of
Agreement |
|
Effective Date
|
|
Invested
Capital Amount |
|
Section 2.02(1)
Date |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Royal Sonesta Cambridge
40 Edwin H. Land Boulevard Cambridge, MA 02142 |
|
HPT Cambridge LLC
|
|
January 31, 2012
|
|
January 31, 2012
|
|
$
|
120,000,000
|
|
January 31, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Royal Sonesta Harbor Court Baltimore
550 Light Street
Baltimore, MD
|
|
Harbor Court Associates, LLC
|
|
May 31, 2012
|
|
May 31, 2012
|
|
$
|
47,296,000
|
|
January 31, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta Hotel Philadelphia
1800 Market Street
Philadelphia, PA
|
|
HPT IHG-2 Properties Trust
|
|
June 18, 2012
|
|
June 18, 2012
|
|
$
|
32,500,000
|
|
January 1, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Royal Sonesta Houston Hotel
2222 West Loop South
Houston, TX
|
|
HPT IHG-2 Properties Trust
|
|
July 16, 2012
|
|
July 16, 2012
|
|
$
|
70,671,350
|
|
January 1, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta Gwinnett Place
1775 Pleasant Hill Road Duluth, GA |
|
HPT Cambridge LLC
|
|
February 26, 2013
|
|
May 17, 2013
|
|
$
|
31,000,000
|
|
January 1, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Royal Sonesta New Orleans
300 Bourbon Street New Orleans, LA |
|
Royal Sonesta, Inc.
|
|
June 28, 2013
|
|
June 28, 2013
|
|
$
|
151,000,000
|
|
January 1, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta Fort Lauderdale
999 North Fort Lauderdale Beach Boulevard Fort Lauderdale, FL |
|
HPT IHG-2 Properties Trust
|
|
May 30, 2014
|
|
May 30, 2014
|
|
$
|
65,000,000
|
|
January 1, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta Silicon Valley
1820 Barber Lane
Milpitas, CA
|
|
HPT IHG-2 Properties Trust
|
|
December 5, 2016
|
|
December 5, 2016
|
|
$
|
46,000,000
|
|
January 1, 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Royal Sonesta Chase Park Plaza
212-232 Kingshighway
Boulevard
St. Louis, MO
|
|
HPT IHG-2 Properties Trust
|
|
June 2, 2017
|
|
June 2, 2017
|
|
$
|
87,750,000
|
|
January 1, 2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Owner
|
|
Hotel
|
|
Landlord
|
|
Date of
Agreement |
|
Effective Date
|
|
Invested
Capital Amount |
|
Section 2.02(1)
Date |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites Burlington
11 Old Concord Road
Burlington, MA
|
|
HPT IHG-2 Properties Trust
|
|
June 12, 2012
|
|
June 12, 2012
|
|
$
|
18,240,000
|
|
January 31, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites Orlando
8480 International Drive Orlando, FL |
|
HPT IHG-2 Properties Trust
|
|
July 6, 2012
|
|
July 9, 2012
|
|
$
|
7,900,000
|
|
January 31, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites Andover
4 Technology Drive Andover, MA |
|
HPT IHG-2 Properties Trust
|
|
July 25, 2012
|
|
July 25, 2012
|
|
$
|
17,100,000
|
|
January 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites Parsippany
61 Interpace Parkway Parsippany, NJ |
|
HPT IHG-2 Properties Trust
|
|
July 30, 2012
|
|
July 30, 2012
|
|
$
|
22,312,500
|
|
January 1, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites Somerset
260 Davidson Avenue Somerset, NJ |
|
HPT IHG-2 Properties Trust
|
|
July 30, 2012
|
|
August 1, 2012
|
|
$
|
7,200,000
|
|
January 1, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites Princeton
4375 U.S. Route 1 South Princeton, NJ |
|
HPT IHG-2 Properties Trust
|
|
July 30, 2012
|
|
August 3, 2012
|
|
$
|
5,810,000
|
|
January 1, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites Malvern
20 Morehall Road Malvern, PA |
|
HPT IHG-2 Properties Trust
|
|
July 27, 2012
|
|
August 6, 2012
|
|
$
|
17,398,113
|
|
January 1, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites Dublin
435 Metro Place South Dublin, OH |
|
HPTMI Properties Trust
|
|
August 6, 2012
|
|
August 11, 2012
|
|
$
|
6,750,000
|
|
January 1, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites Flagstaff
3440 Country Club Drive Flagstaff, AZ |
|
HPTMI Properties Trust
|
|
August 6, 2012
|
|
August 11, 2012
|
|
$
|
5,625,000
|
|
January 1, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites Houston
5190 Hidalgo Street
Houston, TX
|
|
HPT IHG-2 Properties Trust
|
|
August 6, 2012
|
|
August 13, 2012
|
|
$
|
10,260,000
|
|
January 1, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites Columbia
8844 Columbia 100 Parkway Columbia, MD |
|
HPT IHG-2 Properties Trust
|
|
August 6, 2012
|
|
August 14, 2012
|
|
$
|
12,540,000
|
|
January 1, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites Charlotte
7925 Forest Pine Drive Charlotte, NC |
|
HPT IHG-2 Properties Trust
|
|
August 6, 2012
|
|
August 16, 2012
|
|
$
|
6,810,000
|
|
January 1, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites St. Louis
1855 Craigshire Road St. Louis, MO |
|
HPT IHG-2 Properties Trust
|
|
August 6, 2012
|
|
August 22, 2012
|
|
$
|
3,780,000
|
|
January 1, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites Tucson
6477 East Speedway Boulevard
Tucson, AZ
|
|
HPT IHG-2 Properties Trust
|
|
July 23, 2015
|
|
July 23, 2015
|
|
$
|
5,500,000
|
|
January 1, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites Colorado Springs
3880 North Academy Boulevard
Colorado Springs, CO
|
|
HPT IHG-2 Properties Trust
|
|
July 23, 2015
|
|
July 23, 2015
|
|
$
|
6,250,000
|
|
January 1, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites Minneapolis
3040 Eagandale Place
Eagan, MN
|
|
HPT IHG-2 Properties Trust
|
|
July 23, 2015
|
|
July 23, 2015
|
|
$
|
11,500,000
|
|
January 1, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites Omaha
6990 Dodge Street
Omaha, NE
|
|
HPT IHG-2 Properties Trust
|
|
July 23, 2015
|
|
July 23, 2015
|
|
$
|
6,000,000
|
|
January 1, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites Princeton
4225 US Highway 1
South Brunswick – Princeton, NJ
|
|
HPT IHG-2 Properties Trust
|
|
July 23, 2015
|
|
July 23, 2015
|
|
$
|
13,500,000
|
|
January 1, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites Somers Point
900 Mays Landing Road
Somers Point, NJ
|
|
HPT IHG-2 Properties Trust
|
|
July 23, 2015
|
|
July 23, 2015
|
|
$
|
8,750,000
|
|
January 1, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites Cincinnati
2670 Kemper Road
Sharonville, OH
|
|
HPT IHG-2 Properties Trust
|
|
July 23, 2015
|
|
July 23, 2015
|
|
$
|
8,750,000
|
|
January 1, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites Oklahoma City
4361 West Reno Avenue
Oklahoma City, OK
|
|
HPT IHG-2 Properties Trust
|
|
July 23, 2015
|
|
July 23, 2015
|
|
$
|
13,250,000
|
|
January 1, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites Burlington
35 Hurricane Lane
Williston, VT
|
|
HPT IHG-2 Properties Trust
|
|
July 23, 2015
|
|
July 23, 2015
|
|
$
|
11,500,000
|
|
January 1, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites Cleveland Airport
1725 Rosbough Drive
Middleburg Heights, OH
|
|
HPT IHG-2 Properties Trust
|
Februart
|
February 1, 2016
|
|
February 1, 2016
|
|
$
|
7,200,000
|
|
January 1, 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites Westlake
30100 Clemens Road
Westlake, OH
|
|
HPT IHG-2 Properties Trust
|
F
|
February 1, 2016
|
|
February 1, 2016
|
|
$
|
4,800,000
|
|
January 1, 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites Birmingham
3 Greenhill Pkwy at U.S. Highway 280
Birmingham, AL
|
|
HPT IHG-2 Properties Trust
|
|
September 26, 2017
|
|
September 26, 2017
|
|
$
|
2,828,000
|
|
January 1, 2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites Montgomery
1200 Hilmar Court
Montgomery, AL
|
|
HPT IHG-2 Properties Trust
|
|
September 26, 2017
|
|
September 26, 2017
|
|
$
|
5,250,000
|
|
January 1, 2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites
Wilmington – Newark
240 Chapman Road
Newark, DE
|
|
HPT IHG-2 Properties Trust
|
|
September 26, 2017
|
|
September 26, 2017
|
|
$
|
10,452,000
|
|
January 1, 2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites Jacksonville
8365 Dix Ellis Trail
Jacksonville, FL
|
|
HPT IHG-2 Properties Trust
|
|
September 26, 2017
|
|
September 26, 2017
|
|
$
|
7,803,000
|
|
January 1, 2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites Ann Arbor
800 Victors Way
Ann Arbor, MI
|
|
HPT IHG-2 Properties Trust
|
|
September 26, 2017
|
|
September 26, 2017
|
|
$
|
14,474,000
|
|
January 1, 2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites
St. Louis – Chesterfield
15431 Conway Road
Chesterfield, MO
|
|
HPT IHG-2 Properties Trust
|
|
September 26, 2017
|
|
September 26, 2017
|
|
$
|
9,080,000
|
|
January 1, 2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites
Cincinnati – Blue Ash
11401 Reed Hartman Highway
Blue Ash, OH
|
|
HPT IHG-2 Properties Trust
|
|
September 26, 2017
|
|
September 26, 2017
|
|
$
|
11,599,000
|
|
January 1, 2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites
Cincinnati – Sharonville West
11689 Chester Road
Cincinnati, OH
|
|
HPT IHG-2 Properties Trust
|
|
September 26, 2017
|
|
September 26, 2017
|
|
$
|
8,954,000
|
|
January 1, 2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites
Providence – Airport
500 Kilvert Street
Warwick, RI
|
|
HPT IHG-2 Properties Trust
|
|
September 26, 2017
|
|
September 26, 2017
|
|
$
|
9,550,000
|
|
January 1, 2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites Memphis
6141 Old Poplar Pike
Memphis, TN
|
|
HPT IHG-2 Properties Trust
|
|
September 26, 2017
|
|
September 26, 2017
|
|
$
|
8,789,000
|
|
January 1, 2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites
Houston – NASA Clear Lake
525 Bay Area Boulevard
Houston, TX
|
|
HPT IHG-2 Properties Trust
|
|
September 26, 2017
|
|
September 26, 2017
|
|
$
|
12,571,000
|
|
January 1, 2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites
Portland – Vancouver
8005 NE Parkway Drive
Vancouver, WA
|
|
HPT IHG-2 Properties Trust
|
|
September 26, 2017
|
|
September 26, 2017
|
|
$
|
15,820,000
|
|
January 1, 2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites
Atlanta – Perimeter Center East
1901 Savoy Drive
Atlanta, GA
|
|
HPT IHG-3 Properties LLC
|
|
September 26, 2017
|
|
September 26, 2017
|
|
$
|
10,410,000
|
|
January 1, 2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cambridge TRS, Inc.
|
|
Sonesta ES Suites
Chicago – Lombard
2001 South Highland Avenue
Lombard, IL
|
|
HPT IHG-3 Properties LLC
|
|
September 26, 2017
|
|
September 26, 2017
|
|
$
|
10,150,000
|
|
January 1, 2021
|
|
|
Nine Months Ended September 30,
|
|
Year Ended December 31,
|
||||||||||||||||||||
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
||||||||||||
Income from continuing operations (including gains on sales of properties, if any) before income tax expense and equity in earnings (losses) of an investee
|
|
$
|
184,826
|
|
|
$
|
226,993
|
|
|
$
|
167,963
|
|
|
$
|
199,036
|
|
|
$
|
127,750
|
|
|
$
|
153,219
|
|
Fixed Charges
|
|
135,329
|
|
|
161,913
|
|
|
144,898
|
|
|
139,486
|
|
|
145,954
|
|
|
136,111
|
|
||||||
Adjusted Earnings
|
|
$
|
320,155
|
|
|
$
|
388,906
|
|
|
$
|
312,861
|
|
|
$
|
338,522
|
|
|
$
|
273,704
|
|
|
$
|
289,330
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Fixed Charges:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Interest on indebtedness and amortization of debt issuance costs and debt discounts and premiums
|
|
$
|
135,329
|
|
|
$
|
161,913
|
|
|
$
|
144,898
|
|
|
$
|
139,486
|
|
|
$
|
145,954
|
|
|
$
|
136,111
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Ratio of Earnings to Fixed Charges
|
|
2.37
|
x
|
|
2.40x
|
|
|
2.16x
|
|
|
2.43x
|
|
|
1.88x
|
|
|
2.13x
|
|
|
|
Nine Months Ended September 30,
|
|
Year Ended December 31,
|
||||||||||||||||||||
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
||||||||||||
Income from continuing operations (including gains on sales of properties, if any) before income tax expense and equity in earnings (losses) of an investee
|
|
$
|
184,826
|
|
|
$
|
226,993
|
|
|
$
|
167,963
|
|
|
$
|
199,036
|
|
|
$
|
127,750
|
|
|
$
|
153,219
|
|
Fixed Charges
|
|
135,329
|
|
|
161,913
|
|
|
144,898
|
|
|
139,486
|
|
|
145,954
|
|
|
136,111
|
|
||||||
Adjusted Earnings
|
|
$
|
320,155
|
|
|
$
|
388,906
|
|
|
$
|
312,861
|
|
|
$
|
338,522
|
|
|
$
|
273,704
|
|
|
$
|
289,330
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Fixed Charges:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Interest on indebtedness and amortization of debt issuance costs and debt discounts and premiums
|
|
$
|
135,329
|
|
|
$
|
161,913
|
|
|
$
|
144,898
|
|
|
$
|
139,486
|
|
|
$
|
145,954
|
|
|
$
|
136,111
|
|
Preferred distributions
|
|
1,435
|
|
|
20,664
|
|
|
20,664
|
|
|
20,664
|
|
|
26,559
|
|
|
40,145
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Combined Fixed Charges and Preferred distributions
|
|
$
|
136,764
|
|
|
$
|
182,577
|
|
|
$
|
165,562
|
|
|
$
|
160,150
|
|
|
$
|
172,513
|
|
|
$
|
176,256
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Ratio of Earnings to Fixed Charges and Preferred distributions
|
|
2.34
|
x
|
|
2.13x
|
|
|
1.89x
|
|
|
2.11x
|
|
|
1.59x
|
|
|
1.64x
|
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Hospitality Properties Trust;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
|
Date: November 8, 2017
|
/s/ Barry M. Portnoy
|
|
Barry M. Portnoy
|
|
Managing Trustee
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Hospitality Properties Trust;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
|
Date: November 8, 2017
|
/s/ Adam D. Portnoy
|
|
Adam D. Portnoy
|
|
Managing Trustee
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Hospitality Properties Trust;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
|
Date: November 8, 2017
|
/s/ John G. Murray
|
|
John G. Murray
|
|
President and Chief Operating Officer
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Hospitality Properties Trust;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
|
Date: November 8, 2017
|
/s/ Mark L. Kleifges
|
|
Mark L. Kleifges
|
|
Chief Financial Officer and Treasurer
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
|
|
/s/ Barry M. Portnoy
|
|
/s/ John G. Murray
|
Barry M. Portnoy
|
|
John G. Murray
|
Managing Trustee
|
|
President and Chief Operating Officer
|
|
|
|
|
|
|
/s/ Adam D. Portnoy
|
|
/s/ Mark L. Kleifges
|
Adam D. Portnoy
|
|
Mark L. Kleifges
|
Managing Trustee
|
|
Chief Financial Officer and Treasurer
|
|
|
|
|
|
|
Date: November 8, 2017
|
|
|