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Maryland
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27-2962512
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(State or other jurisdiction
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(I.R.S. Employer Identification No.)
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of incorporation or organization)
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Title of each class
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Trading Symbol(s)
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Name of each exchange on which registered
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Common Stock, par value $0.01 per share
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INN
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New York Stock Exchange
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6.45% Series D Cumulative Redeemable Preferred Stock, par value $0.01 per share
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INN-PD
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New York Stock Exchange
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6.25% Series E Cumulative Redeemable Preferred Stock, par value $0.01 per share
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INN-PE
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New York Stock Exchange
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Page
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Item 1.
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Item 1A.
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Item 1B.
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Item 2.
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Item 3.
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Item 4.
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Item 5.
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Item 6.
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Item 7.
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Item 7A.
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Item 8.
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Item 9.
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Item 9A.
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Item 9B.
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Item 10.
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Item 11.
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Item 12.
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Item 13.
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Item 14.
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Item 15.
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•
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financing risks, including the risk of leverage and the corresponding risk of default on our existing indebtedness and potential inability to refinance or extend the maturities of our existing indebtedness;
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•
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default by borrowers to which we lend or provide seller financing;
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•
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global, national, regional and local economic and geopolitical conditions;
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•
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levels of spending for business and leisure travel, as well as consumer confidence;
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•
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supply and demand factors in our markets or sub-markets;
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•
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the effect of alternative accommodations on our business;
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•
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adverse changes in, occupancy, average daily rate (“ADR”) and revenue per available room (“RevPAR”) and other hotel operating metrics;
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•
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hostilities, including future terrorist attacks, or fear of hostilities that affect travel;
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•
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financial condition of, and our relationships with, third-party property managers and franchisors;
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•
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the degree and nature of our competition;
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•
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increased interest rates;
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•
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increased operating costs, including but not limited to labor costs;
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•
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increased renovation costs, which may cause actual renovation costs to exceed our current estimates;
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•
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changes in zoning laws;
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•
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increases in real property taxes that are significantly higher than our expectations;
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•
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risks associated with hotel acquisitions, including the ability to ramp up and stabilize newly acquired hotels with limited or no operating history or that require substantial amounts of capital improvements for us to earn economic returns consistent with our expectations at the time of acquisition;
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•
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risks associated with dispositions of hotel properties, including our ability to successfully complete the sale of hotel properties under contract to be sold, including the risk that the purchaser may not have access to the capital needed to complete the purchase;
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•
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the nature of our structure and transactions such that our federal and state taxes are complex and there is risk of successful challenges to our tax positions by the Internal Revenue Service (“IRS”) or other federal and state taxing authorities;
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•
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the recognition of taxable gains from the sale of hotel properties as a result of the inability to complete certain like-kind exchanges in accordance with Section 1031 of the Internal Revenue Code of 1986, as amended (the “IRC”);
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•
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availability of and our ability to retain qualified personnel;
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•
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our failure to maintain our qualification as a real estate investment trust (“REIT”) under the IRC;
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•
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changes in our business or investment strategy;
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•
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availability, terms and deployment of capital;
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•
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general volatility of the capital markets and the market price of our common stock;
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•
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environmental uncertainties and risks related to natural disasters;
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•
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the effect of infectious disease outbreaks, such as the Coronavirus;
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•
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our ability to recover fully under third party indemnities or our existing insurance policies for insurable losses and our ability to maintain adequate or full replacement cost "all-risk" property insurance policies on our properties on commercially reasonable terms;
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•
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the effect of a data breach or significant disruption of hotel operator information technology networks as a result of cyber-attacks that are greater than insurance coverages or indemnities from service providers;
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•
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the effect on our interest rates if LIBOR is replaced with a new benchmark or performs differently than in the past;
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•
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our ability to effectively manage our joint venture with our joint venture partner;
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•
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current and future changes to the IRC; and
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•
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the other factors discussed under the heading “Risk Factors” in this report.
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•
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Prudently allocating capital which includes, among other things, targeted capital investment and strategic transactions;
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•
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Evolving our portfolio by selling assets with lower operating margins, RevPAR growth opportunities or risk-adjusted return profiles and purchasing assets with higher operating margins, RevPAR growth opportunities or risk-adjusted return profiles; and
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•
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Intensive asset management.
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•
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RevPAR Growth. We believe that our hotels will continue to experience long-term demand growth based on the characteristics of our portfolio and current industry fundamentals and trends in the Upscale segment.
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•
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Stable Cash Flow Potential. Our hotels are generally operated with fewer employees than full-service hotels that offer more amenities including more extensive food and beverage options, which we believe enables us to generate higher operating margins and cash flows with less volatility.
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•
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Broad Customer Base. Our target brands deliver consistently high-quality hotel accommodations with value-oriented pricing that we believe appeals to a wide range of customers, including both business and leisure travelers. We believe that our hotels are particularly popular with frequent business travelers who seek to stay in hotels operating under Marriott, Hilton, Hyatt, or IHG brands, which offer strong loyalty rewards programs.
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•
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Enhanced Diversification and Lower Capital Requirements. Premium-branded hotels with efficient operating models generally require less capital to acquire, build, or maintain on an absolute and a per-key basis, than hotels in the Upper-Upscale and Luxury segments of the industry. As a result, we can diversify our investment capital into ownership of a larger number of hotels than we could in more expensive segments.
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•
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potential for strong risk-adjusted returns and are located in the top 50 MSAs and other select markets;
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can operate under leading franchise brands, which may include but are not limited to brands owned by Marriott, Hilton, Hyatt, and IHG;
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located in close proximity to multiple demand generators, such as corporate offices and headquarters, retail centers, airports, state capitols, convention centers, universities, and leisure attractions, with a diverse source of potential guests, including corporate, government and leisure travelers;
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located in markets with barriers to entry due to lengthy or challenging real estate entitlement processes or other factors;
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•
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can be acquired at a discount to replacement cost; and
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provide an opportunity to add value through operating efficiencies, repositioning, renovating or rebranding.
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•
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we may be unable to acquire, or may be forced to acquire at significantly higher prices, desired hotels because of competition from other real estate investors, including other real estate operating companies, REITs and investment funds;
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•
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we may be unable to obtain the necessary debt or equity financing to consummate an acquisition or, if obtainable, financing may not be on satisfactory terms; and
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•
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agreements for the acquisition of hotels are typically subject to customary conditions to closing, including satisfactory completion of due diligence investigations and the receipt of franchisor and lender consents, and we may spend significant time and incur significant transaction costs on potential acquisitions that we do not consummate.
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•
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we may not possess the same level of familiarity with the dynamics and market conditions of any new markets that we may enter, which could result in us paying too much for hotels in new markets or not have the hotels achieve their maximum potential;
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market conditions may result in lower than expected occupancy and guestroom rates;
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we may acquire hotels without any recourse, or with only limited recourse, for liabilities, whether known or unknown, such as cleanup of environmental contamination, claims by tenants, vendors or other persons against the former owners of the hotels and claims for indemnification by general partners, directors, officers and others indemnified by the former owners of the hotels;
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we may need to spend more than anticipated amounts to make necessary improvements or renovations to our newly acquired hotels; and
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we may be unable to quickly and efficiently integrate new acquisitions, particularly acquisitions of portfolios of hotels, into our existing operations.
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•
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require us to dedicate a substantial portion of our cash flow from operations to make principal and interest payments on our indebtedness, thereby reducing our cash flow available to fund working capital, capital expenditures and other general corporate purposes, including to pay dividends on our common stock and our preferred stock as currently contemplated or necessary to satisfy the requirements for qualification as a REIT;
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•
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increase our vulnerability to general adverse economic and industry conditions and limit our flexibility in planning for, or reacting to, changes in our business and our industry;
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•
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limit our ability to borrow additional funds or refinance indebtedness on favorable terms or at all to expand our business or ease liquidity constraints; and
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•
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place us at a competitive disadvantage relative to competitors that have less indebtedness.
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interest rate hedging can be expensive, particularly during periods of volatile interest rates;
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available interest rate hedges may not correspond directly with the interest rate risk for which protection is sought;
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the duration of the hedge may not match the duration of the related liability;
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the credit quality of the hedging counterparty owing money on the hedge may be downgraded to such an extent that it impairs our ability to collect, sell, or assign our side of the hedging transaction; and
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the hedging counterparty owing money in the hedging transaction may default on its obligation to pay.
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relatively short-duration occupancies;
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•
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dependence on business and commercial travelers and tourism;
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•
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over-building of hotels in our markets, which could adversely affect occupancy and revenue at the hotels we acquire;
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increases in energy costs and other expenses affecting travel, which may affect travel patterns and reduce the number of business and commercial travelers and tourists;
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increases in operating costs, including increased real estate and personal property taxes, due to inflation and other factors that may not be offset by increased guestroom rates;
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•
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potential increases in labor costs at our hotels, including as a result of unionization of the labor force, and increasing health care insurance expense;
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•
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changes in governmental laws and regulations, fiscal policies and zoning ordinances and the related costs of compliance with laws and regulations, fiscal policies and ordinances;
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•
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adverse effects of international, national, regional and local economic and market conditions; and
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unforeseen events beyond our control, such as instability in the national, European or global economy, terrorist attacks, travel-related health concerns including pandemics and epidemics, travel-related environmental concerns including water contamination and air pollution, political instability, regional hostilities, increases in fuel prices, imposition of taxes or surcharges by regulatory authorities and travel-related accidents and unusual weather patterns, including natural disasters such as hurricanes.
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•
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possible environmental problems;
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•
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construction cost overruns and delays;
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a possible shortage of available cash to fund capital improvements and replacements and, the related possibility that financing for these capital improvements may not be available to us on affordable terms; and
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uncertainties as to market demand or a loss of market demand after capital improvements and replacements have begun.
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possible environmental problems;
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construction cost overruns and delays;
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receipt of and expense related to zoning, occupancy and other required governmental permits and authorizations;
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•
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development costs incurred for projects that are not pursued to completion;
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acts of God such as earthquakes, hurricanes, floods or fires that could adversely affect a project;
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inability to raise capital; and
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governmental restrictions on the nature or size of a project.
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adverse changes in international, national, regional and local economic and market conditions;
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changes in interest rates and in the availability, cost and terms of debt financing;
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changes in governmental laws and regulations, fiscal policies and zoning ordinances and the related costs of compliance with laws and regulations, fiscal policies and ordinances;
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the ongoing need for capital improvements, particularly in older structures, that may require us to expend funds to correct defects or to make improvements before an asset can be sold;
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changes in operating expenses; and
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civil unrest, acts of God, including earthquakes, floods and other natural disasters, which may result in uninsured losses, and acts of war, terrorism or environmental uncertainties, such as the effect of the Coronavirus or outbreak of other significant diseases.
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actual receipt of an improper benefit or profit in money, property or services; or
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active and deliberate dishonesty by the director or officer that was established by a final judgment as being material to the cause of action adjudicated.
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a limited availability of market quotations for our securities;
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a limited ability of our stockholders to make transactions in our securities;
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additional trading restrictions being placed on us;
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reduced liquidity with respect to our securities;
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a determination that our common stock is “penny stock,” which will require brokers trading in our common stock to adhere to more stringent rules, possibly resulting in a reduced level of trading activity in the secondary trading market for the common stock;
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a limited amount of news and analyst coverage; and
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a decreased ability to issue additional securities or obtain additional financing in the future.
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actual or anticipated variations in our quarterly results of operations;
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increases in interest rates;
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changes in market valuations of companies in the lodging industry;
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changes in expectations of future financial performance or changes in estimates of securities analysts;
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fluctuations in stock market prices and volumes;
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our issuances of common stock, preferred stock, or other securities in the future;
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the inclusion of our common stock and preferred stock in equity indices, which could induce additional purchases;
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the exclusion of our common stock and preferred stock from equity indices;
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the addition or departure of key personnel;
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announcements by us or our competitors of acquisitions, investments or strategic alliances;
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unforeseen events beyond our control, such as instability in the national, European or global economy, terrorist attacks, travel related health concerns including pandemics and epidemics, political instability, regional hostilities, increases in fuel prices, imposition of taxes or surcharges by regulatory authorities and travel-related accidents and unusual weather patterns, including natural disasters; and
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changes in the tax laws or regulations to which we are subject.
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if the leases of our hotels to our TRS lessees are not respected as true leases for federal income tax purposes;
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if our Operating Partnership is treated as a publicly traded partnership taxable as a corporation for federal income tax purposes;
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if our existing or future hotel management companies do not qualify as “eligible independent contractors” or if our hotels are not “qualified lodging facilities,” as required by federal income tax law; or
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if we fail to meet any of the required REIT qualifications.
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we would not be allowed a deduction for dividends paid to stockholders in computing our taxable income and would be subject to federal income tax at regular corporate rates (at a rate of 21%);
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we could be subject to increased state and local taxes; and
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unless we are entitled to relief under certain federal income tax laws, we could not re-elect REIT status until the fifth calendar year after the year in which we failed to qualify as a REIT.
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Franchise/Brand
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Location
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Number of
Guestrooms |
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Marriott
|
|
|
|
|
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AC Hotel by Marriott(1)
|
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Atlanta, GA
|
|
255
|
|
Courtyard by Marriott(1)
|
|
Indianapolis, IN
|
|
297
|
|
Courtyard by Marriott(1)
|
|
Fort Lauderdale, FL
|
|
261
|
|
Courtyard by Marriott(1)
|
|
Nashville, TN
|
|
226
|
|
Courtyard by Marriott(1)
|
|
New Haven, CT
|
|
207
|
|
Courtyard by Marriott(1)
|
|
Fort Worth, TX
|
|
203
|
|
Courtyard by Marriott(1)
|
|
New Orleans (Convention), LA
|
|
202
|
|
Courtyard by Marriott(1)
|
|
Pittsburgh, PA
|
|
183
|
|
Courtyard by Marriott(1)
|
|
Charlotte, NC
|
|
181
|
|
Courtyard by Marriott(1)
|
|
Atlanta (Decatur), GA
|
|
179
|
|
Courtyard by Marriott(1)
|
|
Phoenix (Scottsdale), AZ
|
|
153
|
|
Courtyard by Marriott(1)
|
|
New Orleans (Metairie), LA
|
|
153
|
|
Courtyard by Marriott(1)
|
|
Atlanta (Downtown), GA
|
|
150
|
|
Courtyard by Marriott(1)
|
|
New Orleans (French Quarter), LA
|
|
140
|
|
Courtyard by Marriott(1)
|
|
Kansas City, MO
|
|
123
|
|
Courtyard by Marriott(1)
|
|
Dallas (Arlington), TX
|
|
103
|
|
Fairfield Inn & Suites by Marriott(2)
|
|
Louisville, KY
|
|
140
|
|
Four Points by Sheraton(2)
|
|
San Francisco, CA
|
|
101
|
|
Marriott(1)
|
|
Boulder, CO
|
|
165
|
|
Residence Inn by Marriott(4)
|
|
Portland (Downtown), OR
|
|
258
|
|
Residence Inn by Marriott(1)
|
|
Baltimore (Downtown), MD
|
|
189
|
|
Residence Inn by Marriott(1)
|
|
Cleveland, OH
|
|
175
|
|
Residence Inn by Marriott(1)
|
|
Atlanta, GA
|
|
160
|
|
Residence Inn by Marriott(1)
|
|
Boston (Watertown), MA
|
|
150
|
|
Residence Inn by Marriott(1)
|
|
Baltimore (Hunt Valley), MD
|
|
141
|
|
Residence Inn by Marriott(2)(3)
|
|
Portland (Portland Airport at Cascade Station), OR
|
|
124
|
|
Residence Inn by Marriott(4)
|
|
Portland (Hillsboro), OR
|
|
122
|
|
Residence Inn by Marriott(1)
|
|
New Orleans (Metairie), LA
|
|
120
|
|
Residence Inn by Marriott(1)
|
|
Branchburg, NJ
|
|
101
|
|
Residence Inn by Marriott(1)
|
|
Dallas (Arlington), TX
|
|
96
|
|
SpringHill Suites by Marriott(1)
|
|
New Orleans, LA
|
|
208
|
|
SpringHill Suites by Marriott(2)
|
|
Louisville, KY
|
|
198
|
|
SpringHill Suites by Marriott(1)
|
|
Indianapolis, IN
|
|
156
|
|
SpringHill Suites by Marriott(1)
|
|
Phoenix (Scottsdale), AZ
|
|
121
|
|
SpringHill Suites by Marriott(1)
|
|
Nashville, TN
|
|
78
|
|
Total Marriott (35 hotel properties)
|
|
|
|
5,819
|
|
|
|
|
|
|
Franchise/Brand
|
|
Location
|
|
Number of
Guestrooms |
|
Hilton
|
|
|
|
|
|
DoubleTree(1)
|
|
San Francisco, CA
|
|
210
|
|
Hampton Inn & Suites(2)
|
|
Minneapolis, MN
|
|
211
|
|
Hampton Inn & Suites(1)(3)
|
|
Austin, TX
|
|
209
|
|
Hampton Inn & Suites(1)
|
|
Tampa (Ybor City), FL
|
|
138
|
|
Hampton Inn & Suites(1)
|
|
Baltimore, MD
|
|
116
|
|
Hampton Inn & Suites(1)
|
|
Ventura (Camarillo), CA
|
|
116
|
|
Hampton Inn & Suites(1)
|
|
San Diego (Poway), CA
|
|
108
|
|
Hampton Inn & Suites(4)
|
|
Silverthorne, CO
|
|
88
|
|
Hilton Garden Inn(1)
|
|
Houston (Energy Corridor), TX
|
|
190
|
|
Hilton Garden Inn(1)(3)
|
|
Houston (Galleria), TX
|
|
182
|
|
Hilton Garden Inn(4)
|
|
San Francisco, CA
|
|
169
|
|
Hilton Garden Inn(4)
|
|
San Jose (Milpitas), CA
|
|
161
|
|
Hilton Garden Inn(1)
|
|
Boston (Waltham), MA
|
|
148
|
|
Hilton Garden Inn(1)
|
|
Greenville, SC
|
|
120
|
|
Hilton Garden Inn(1)
|
|
Minneapolis (Eden Prairie), MN
|
|
97
|
|
Homewood Suites(1)
|
|
Aliso Viejo (Laguna Beach), CA
|
|
129
|
|
Homewood Suites(1)
|
|
Tucson, AZ
|
|
122
|
|
Total Hilton (17 hotel properties)
|
|
|
|
2,514
|
|
Hyatt
|
|
|
|
|
|
Hyatt House(1)
|
|
Orlando, FL
|
|
168
|
|
Hyatt House(1)
|
|
Miami, FL
|
|
163
|
|
Hyatt House(2)
|
|
Denver (Englewood), CO
|
|
135
|
|
Hyatt Place(1)
|
|
Minneapolis, MN
|
|
213
|
|
Hyatt Place(1)
|
|
Chicago (Downtown), IL
|
|
206
|
|
Hyatt Place(2)
|
|
Phoenix (Mesa), AZ
|
|
152
|
|
Hyatt Place(2)
|
|
Chicago (Lombard), IL
|
|
151
|
|
Hyatt Place(2)
|
|
Orlando (Convention), FL
|
|
150
|
|
Hyatt Place(2)
|
|
Orlando (Universal), FL
|
|
150
|
|
Hyatt Place(1)(3)
|
|
Portland, OR
|
|
136
|
|
Hyatt Place(2)
|
|
Denver (Lone Tree), CO
|
|
127
|
|
Hyatt Place(2)
|
|
Phoenix (Scottsdale), AZ
|
|
126
|
|
Hyatt Place(2)
|
|
Denver (Englewood), CO
|
|
126
|
|
Hyatt Place(2)
|
|
Chicago (Hoffman Estates), IL
|
|
126
|
|
Hyatt Place(2)
|
|
Baltimore (Owing Mills), MD
|
|
123
|
|
Hyatt Place(1)
|
|
Long Island (Garden City), NY
|
|
122
|
|
Total Hyatt (16 hotel properties)
|
|
|
|
2,374
|
|
IHG
|
|
|
|
|
|
Holiday Inn Express & Suites(1)
|
|
San Francisco, CA
|
|
252
|
|
Holiday Inn Express & Suites(1)
|
|
Minneapolis (Minnetonka), MN
|
|
93
|
|
Hotel Indigo(1)
|
|
Asheville, NC
|
|
115
|
|
Staybridge Suites(1)
|
|
Denver (Glendale), CO
|
|
121
|
|
Total IHG (4 hotel properties)
|
|
|
|
581
|
|
Total Portfolio (72 hotel properties)
|
|
|
|
11,288
|
|
(1)
|
These hotel properties are unencumbered or included in our borrowing base for our unsecured credit and term loan facilities at December 31, 2019.
|
(2)
|
These hotel properties are subject to mortgage debt at December 31, 2019. For additional information concerning our mortgage debt and lenders, see "Item 7. — Management’s Discussion and Analysis of Financial Condition and Results of Operations — Outstanding Indebtedness,” and "Note 6-Debt,” to our Consolidated Financial Statements included under "Item 8. — Financial Statements and Supplementary Data.”
|
(3)
|
These hotel properties are subject to ground leases as described below in “Our Hotel Operating Agreements — Ground Leases.”
|
(4)
|
We own a 51% controlling interest in these hotel properties through a consolidated joint venture. These hotel properties are included in the borrowing base for the joint venture's credit facility.
|
•
|
The Residence Inn by Marriott located in Portland (Cascade Station), OR is subject to a ground lease with an initial lease termination date of June 30, 2084 with one option to extend for an additional 14 years. Ground rent for the initial lease term was prepaid in full at the time we acquired the leasehold interest. If the option to extend is exercised, monthly ground rent will be charged based on a formula established in the ground lease.
|
•
|
The Hyatt Place located in Portland (Portland Airport/Cascade Station), OR is subject to a ground lease with a lease termination date of June 30, 2084 with one option to extend for an additional 14 years. Ground rent for the initial lease term was prepaid in full at the time we acquired the leasehold interest. If the option to extend is exercised, monthly ground rent will be charged based on a formula established in the ground lease.
|
•
|
The Hampton Inn & Suites located in Austin (Downtown/Convention Center), TX is subject to a ground lease with an initial lease termination date of May 31, 2050. Annual ground rent currently is estimated to be $0.5 million for 2020 including performance based incentive rent. Annual rent is increased every five years with the next adjustment coming in 2020.
|
•
|
The Hilton Garden Inn located in Houston (Galleria), TX is subject to a ground lease with an initial lease termination date of April 20, 2053 with one option to extend for an additional 10 years. Annual ground rent currently is estimated to be $0.5 million for 2020 including performance based incentive rent. Annual rent is increased every five years with the next adjustment coming in 2023.
|
Management Company
|
|
Number of
Properties |
|
Number of
Guestrooms |
||
Affiliates of Aimbridge Hospitality, including Interstate Management Company, LLC (1)
|
|
30
|
|
|
4,533
|
|
OTO Development, LLC
|
|
12
|
|
|
1,696
|
|
Stonebridge Realty Advisors, Inc. and affiliates
|
|
9
|
|
|
1,312
|
|
Affiliates of Marriott, including Courtyard Management Corporation, SpringHill SMC Corporation and Residence Inn by Marriott, Inc.
|
|
7
|
|
|
1,176
|
|
Select Hotels Group, LLC, an affiliate of Hyatt
|
|
5
|
|
|
807
|
|
White Lodging Services Corporation
|
|
4
|
|
|
791
|
|
American Liberty Hospitality, Inc.
|
|
2
|
|
|
372
|
|
Fillmore Hospitality
|
|
1
|
|
|
261
|
|
InterContinental Hotel Group Resources, Inc., an affiliate of IHG
|
|
1
|
|
|
252
|
|
Crestline Hotels & Resorts, LLC
|
|
1
|
|
|
88
|
|
Total
|
|
72
|
|
|
11,288
|
|
Item 5.
|
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.
|
(in thousands, except per share amounts)
|
|
2019
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
||||||||||
Statement of Operations Data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Room
|
|
$
|
505,342
|
|
|
$
|
523,439
|
|
|
$
|
479,934
|
|
|
$
|
443,270
|
|
|
$
|
436,202
|
|
Food and beverage
|
|
23,785
|
|
|
24,225
|
|
|
21,359
|
|
|
19,777
|
|
|
18,325
|
|
|||||
Other
|
|
20,221
|
|
|
19,606
|
|
|
14,084
|
|
|
10,888
|
|
|
8,928
|
|
|||||
Total revenues
|
|
549,348
|
|
|
567,270
|
|
|
515,377
|
|
|
473,935
|
|
|
463,455
|
|
|||||
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Room
|
|
112,244
|
|
|
119,724
|
|
|
108,715
|
|
|
97,358
|
|
|
97,255
|
|
|||||
Food and beverage
|
|
18,552
|
|
|
19,191
|
|
|
16,734
|
|
|
14,841
|
|
|
14,275
|
|
|||||
Other hotel operating expenses
|
|
158,181
|
|
|
159,173
|
|
|
144,526
|
|
|
134,420
|
|
|
134,548
|
|
|||||
Property taxes, insurance and other
|
|
44,220
|
|
|
43,339
|
|
|
37,419
|
|
|
30,250
|
|
|
31,190
|
|
|||||
Management fees
|
|
16,575
|
|
|
18,521
|
|
|
18,210
|
|
|
18,812
|
|
|
18,560
|
|
|||||
Depreciation and amortization
|
|
99,445
|
|
|
101,013
|
|
|
85,927
|
|
|
72,406
|
|
|
64,052
|
|
|||||
Corporate general and administrative
|
|
23,622
|
|
|
21,509
|
|
|
19,597
|
|
|
19,292
|
|
|
21,204
|
|
|||||
Hotel property acquisition costs
|
|
—
|
|
|
—
|
|
|
354
|
|
|
3,492
|
|
|
1,246
|
|
|||||
Loss on impairment of assets
|
|
2,521
|
|
|
1,075
|
|
|
—
|
|
|
577
|
|
|
1,115
|
|
|||||
Total expenses
|
|
475,360
|
|
|
483,545
|
|
|
431,482
|
|
|
391,448
|
|
|
383,445
|
|
|||||
Gain on disposal of assets, net
|
|
45,418
|
|
|
41,474
|
|
|
43,209
|
|
|
49,855
|
|
|
65,067
|
|
|||||
Operating income
|
|
119,406
|
|
|
125,199
|
|
|
127,104
|
|
|
132,342
|
|
|
145,077
|
|
|||||
Other income (expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Interest expense
|
|
(41,030
|
)
|
|
(41,944
|
)
|
|
(29,687
|
)
|
|
(28,091
|
)
|
|
(30,414
|
)
|
|||||
Other income, net
|
|
5,472
|
|
|
6,949
|
|
|
3,778
|
|
|
2,560
|
|
|
11,146
|
|
|||||
Total other expense
|
|
(35,558
|
)
|
|
(34,995
|
)
|
|
(25,909
|
)
|
|
(25,531
|
)
|
|
(19,268
|
)
|
|||||
Income from continuing operations before income taxes
|
|
83,848
|
|
|
90,204
|
|
|
101,195
|
|
|
106,811
|
|
|
125,809
|
|
|||||
Income tax (expense) benefit
|
|
(1,500
|
)
|
|
922
|
|
|
(1,674
|
)
|
|
1,450
|
|
|
(553
|
)
|
|||||
Net income
|
|
82,348
|
|
|
91,126
|
|
|
99,521
|
|
|
108,261
|
|
|
125,256
|
|
|||||
Less: (Income) loss attributable to non-controlling interests:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Operating Partnership
|
|
(157
|
)
|
|
(205
|
)
|
|
(307
|
)
|
|
(456
|
)
|
|
(819
|
)
|
|||||
Joint venture
|
|
419
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Net income attributable to Summit Hotel Properties, Inc.
|
|
82,610
|
|
|
90,921
|
|
|
99,214
|
|
|
107,805
|
|
|
124,437
|
|
|||||
Preferred dividends
|
|
(14,838
|
)
|
|
(16,671
|
)
|
|
(17,408
|
)
|
|
(18,232
|
)
|
|
(16,588
|
)
|
|||||
Premium on redemption of preferred stock
|
|
—
|
|
|
(3,277
|
)
|
|
(2,572
|
)
|
|
(2,125
|
)
|
|
—
|
|
|||||
Net income attributable to common stockholders
|
|
$
|
67,772
|
|
|
$
|
70,973
|
|
|
$
|
79,234
|
|
|
$
|
87,448
|
|
|
$
|
107,849
|
|
Earnings per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Basic
|
|
$
|
0.65
|
|
|
$
|
0.68
|
|
|
$
|
0.79
|
|
|
$
|
1.00
|
|
|
$
|
1.25
|
|
Diluted
|
|
$
|
0.65
|
|
|
$
|
0.68
|
|
|
$
|
0.79
|
|
|
$
|
1.00
|
|
|
$
|
1.24
|
|
Weighted average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Basic
|
|
103,887
|
|
|
103,623
|
|
|
99,406
|
|
|
86,874
|
|
|
85,920
|
|
|||||
Diluted
|
|
103,939
|
|
|
103,842
|
|
|
99,780
|
|
|
87,343
|
|
|
87,144
|
|
|||||
Dividends per share
|
|
$
|
0.72
|
|
|
$
|
0.72
|
|
|
$
|
0.67
|
|
|
$
|
0.55
|
|
|
$
|
0.47
|
|
Balance Sheet Data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Total assets
|
|
$
|
2,355,683
|
|
|
$
|
2,222,297
|
|
|
$
|
2,209,874
|
|
|
$
|
1,718,505
|
|
|
$
|
1,575,394
|
|
Debt
|
|
$
|
1,016,163
|
|
|
$
|
958,712
|
|
|
$
|
868,236
|
|
|
$
|
652,414
|
|
|
$
|
671,536
|
|
Total equity
|
|
$
|
1,243,390
|
|
|
$
|
1,192,144
|
|
|
$
|
1,277,376
|
|
|
$
|
1,013,470
|
|
|
$
|
856,926
|
|
•
|
Occupancy — Occupancy represents the total number of guestrooms occupied divided by the total number of guestrooms available.
|
•
|
Average Daily Rate (ADR) — ADR represents total room revenues divided by the total number of guestrooms occupied.
|
•
|
Revenue Per Available Room (RevPAR) — RevPAR is the product of ADR and Occupancy.
|
(1)
|
In addition to the purchase price, we generally anticipate investing additional amounts for hotel renovations at the time we purchase a hotel property. Such additional investments are included in our underwriting of the hotel property prior to purchase, but are not included in the table above. See Item 7. – "Management's Discussion and Analysis of Financial Condition and Results of Operations – Capital Expenditures."
|
(2)
|
The net assets acquired in 2019 were purchased for $274.5 million plus the purchase of adjacent land parcels totaling $2.4 million, $1.0 million of net working capital assets and capitalized transaction costs of $0.4 million. We own a 51% controlling interest in these hotel properties through a consolidated joint venture.
|
(3)
|
The net assets acquired in 2018 were purchased for $71.0 million plus the purchase at settlement of $0.1 million of net working capital liabilities and capitalized transaction costs of $0.1 million.
|
(4)
|
On October 8, 2019, we acquired a portfolio of four hotels for an aggregate purchase price of $249.0 million. The hotels acquired included the Hilton Garden Inn - San Francisco, CA, the Hilton Garden Inn - San Jose (Milpitas), CA, the Residence Inn by Marriott - Portland (Downtown), OR, and the Residence Inn by Marriott - Portland (Hillsboro), OR.
|
Disposition Date
|
|
Franchise/Brand
|
|
Location
|
|
Guestrooms
|
|
Gross Sales Price
|
|
Aggregate Gain, net
|
|||||
Year Ended December 31, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
February 12, 2019
|
|
Portfolio Sale - two properties(1)
|
|
Charleston, WV (1)
|
|
130
|
|
|
$
|
11,600
|
|
|
$
|
4,163
|
|
April 17, 2019
|
|
Portfolio Sale - six properties (2)
|
|
various (2)
|
|
815
|
|
|
135,000
|
|
|
36,626
|
|
||
November 8, 2019
|
|
Portfolio Sale - two properties (3)
|
|
Birmingham, AL (3)
|
|
225
|
|
|
21,800
|
|
|
4,857
|
|
||
Total
|
|
|
|
|
|
1,170
|
|
|
$
|
168,400
|
|
|
$
|
45,646
|
|
Year Ended December 31, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
June 29, 2018
|
|
Portfolio Sale - two properties(4)
|
|
various (4)
|
|
175
|
|
|
$
|
18,950
|
|
|
$
|
13,133
|
|
June 29, 2018
|
|
Portfolio Sale - two properties (5)
|
|
Duluth, GA (5)
|
|
265
|
|
|
24,850
|
|
|
4,218
|
|
||
July 24, 2018
|
|
Portfolio Sale - three properties (6)
|
|
various (6)
|
|
322
|
|
|
46,500
|
|
|
22,964
|
|
||
September 28, 2018
|
|
Hyatt Place
|
|
Fort Myers, FL
|
|
148
|
|
|
16,500
|
|
|
2,195
|
|
||
November 7, 2018
|
|
Land parcel
|
|
Spokane, WA
|
|
n/a
|
|
|
450
|
|
|
139
|
|
||
Total
|
|
|
|
|
|
910
|
|
|
$
|
107,250
|
|
|
$
|
42,649
|
|
(1)
|
The portfolio included the Country Inn & Suites and the Holiday Inn Express in Charleston, WV.
|
(2)
|
The portfolio included the SpringHill Suites in Minneapolis (Bloomington), MN, the Hampton Inn & Suites in Minneapolis (Bloomington), MN, the Residence Inn in Salt Lake City, UT, the Hyatt Place in Dallas (Arlington), TX, the Hampton Inn in Santa Barbara (Goleta), CA, and the Hampton Inn in Boston (Norwood), MA. The sale resulted in a net gain of $36.6 million based on a gross aggregate sales price of $135.0 million, or a net aggregate sales price of $133.0 million after a buyer credit of $2.0 million.
|
(3)
|
The portfolio included the Hilton Garden Inn in Birmingham (Lakeshore), AL and the Hilton Garden Inn in Birmingham (Liberty Park), AL.
|
(4)
|
The portfolio included the Hampton Inn in Provo, UT and the Holiday Inn Express & Suites in Sandy, UT.
|
(5)
|
The portfolio included the Holiday Inn in Duluth, GA and the Hilton Garden Inn in Duluth, GA. We provided seller financing of $3.6 million on the sale of these properties under two three-and-a-half-year second mortgage notes with a blended interest rate of 7.38%.
|
(6)
|
The portfolio included the Hampton Inn & Suites in Smyrna, TN, the Hilton Garden Inn in Smyrna, TN and the Hyatt Place Phoenix North in Phoenix, AZ. The proceeds from these sales were used to complete a 1031 Exchange, which resulted in the deferral of taxable gains of $22.2 million.
|
|
|
2019
|
|
2018
|
|
Year-over-Year
Dollar Change
|
|
Year-over-Year
Percentage Change
|
|
||||||||||||||||||||||
|
|
Total
Portfolio
(72 hotels) |
|
Same-Store
Portfolio (65 hotels) |
|
Total
Portfolio
(77 hotels) |
|
Same-Store
Portfolio (65 hotels) |
|
Total
Portfolio
(72/77 hotels) |
|
Same-Store
Portfolio (65 hotels) |
|
Total
Portfolio
(72/77 hotels) |
|
Same-Store
Portfolio (65 hotels) |
|
||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Room
|
|
$
|
505,342
|
|
|
$
|
461,138
|
|
|
$
|
523,439
|
|
|
$
|
456,180
|
|
|
$
|
(18,097
|
)
|
|
$
|
4,958
|
|
|
(3.5
|
)%
|
|
1.1
|
%
|
|
Food and beverage
|
|
23,785
|
|
|
22,304
|
|
|
24,225
|
|
|
22,188
|
|
|
(440
|
)
|
|
116
|
|
|
(1.8
|
)%
|
|
0.5
|
%
|
|
||||||
Other
|
|
20,221
|
|
|
19,299
|
|
|
19,606
|
|
|
18,639
|
|
|
615
|
|
|
660
|
|
|
3.1
|
%
|
|
3.5
|
%
|
|
||||||
Total
|
|
$
|
549,348
|
|
|
$
|
502,741
|
|
|
$
|
567,270
|
|
|
$
|
497,007
|
|
|
$
|
(17,922
|
)
|
|
$
|
5,734
|
|
|
(3.2
|
)%
|
|
1.2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Room
|
|
$
|
112,244
|
|
|
$
|
102,024
|
|
|
$
|
119,724
|
|
|
$
|
102,569
|
|
|
$
|
(7,480
|
)
|
|
$
|
(545
|
)
|
|
(6.2
|
)%
|
|
(0.5
|
)%
|
|
Food and beverage
|
|
18,552
|
|
|
17,143
|
|
|
19,191
|
|
|
17,264
|
|
|
(639
|
)
|
|
(121
|
)
|
|
(3.3
|
)%
|
|
(0.7
|
)%
|
|
||||||
Other hotel operating expenses
|
|
158,181
|
|
|
144,291
|
|
|
159,173
|
|
|
137,541
|
|
|
(992
|
)
|
|
6,750
|
|
|
(0.6
|
)%
|
|
4.9
|
%
|
|
||||||
Total
|
|
$
|
288,977
|
|
|
$
|
263,458
|
|
|
$
|
298,088
|
|
|
$
|
257,374
|
|
|
$
|
(9,111
|
)
|
|
$
|
6,084
|
|
|
(3.1
|
)%
|
|
2.4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Occupancy
|
|
78.5
|
%
|
|
78.3
|
%
|
|
77.9
|
%
|
|
77.9
|
%
|
|
n/a
|
|
|
n/a
|
|
|
62
|
|
bps
|
45
|
|
bps
|
||||||
ADR
|
|
$
|
158.45
|
|
|
$
|
158.57
|
|
|
$
|
153.79
|
|
|
$
|
157.83
|
|
|
$
|
4.66
|
|
|
$
|
0.74
|
|
|
3.0
|
%
|
|
0.5
|
%
|
|
RevPAR
|
|
$
|
124.35
|
|
|
$
|
124.21
|
|
|
$
|
119.75
|
|
|
$
|
122.91
|
|
|
$
|
4.60
|
|
|
$
|
1.30
|
|
|
3.8
|
%
|
|
1.1
|
%
|
|
•
|
Revenues. The decline in revenues was due to a $47.5 million decline in revenue related to the 2019/2018 Sold Hotels, partially offset by incremental revenues of $23.8 million generated by the 2019/2018 Acquired Hotels and a $5.7 million increase in same-store revenues.
|
•
|
RevPAR. The 3.8% increase in RevPAR for the total portfolio is the result of the purchase of higher RevPAR hotel properties with the 2019/2018 Acquired Hotels, which produced an aggregate RevPAR of $154.16 in 2019, the sale of lower RevPAR hotels with the 2019/2018 Sold Hotels, which produced an aggregate RevPAR of $99.15 in 2018, and a 1.1% increase in RevPAR for the same-store hotels.
|
•
|
Expenses. The decrease in total portfolio expenses is the result of a decline in expenses of $26.0 million related to the 2019/2018 Sold Hotels, partially offset by incremental expenses of $10.8 million due to the 2019/2018 Acquired
|
|
|
For the Years Ended December 31,
|
|
|
|
|
|||||||||
|
|
2019
|
|
2018
|
|
Dollar Change
|
|
Percentage Change
|
|||||||
Property taxes, insurance and other
|
|
$
|
44,220
|
|
|
$
|
43,339
|
|
|
$
|
881
|
|
|
2.0
|
%
|
Management fees
|
|
16,575
|
|
|
18,521
|
|
|
(1,946
|
)
|
|
(10.5
|
)%
|
|||
Depreciation and amortization
|
|
99,445
|
|
|
101,013
|
|
|
(1,568
|
)
|
|
(1.6
|
)%
|
|||
Corporate general and administrative
|
|
23,622
|
|
|
21,509
|
|
|
2,113
|
|
|
9.8
|
%
|
|||
Loss on impairment of assets
|
|
2,521
|
|
|
1,075
|
|
|
1,446
|
|
|
134.5
|
%
|
|||
Gain on disposal of assets, net
|
|
45,418
|
|
|
41,474
|
|
|
3,944
|
|
|
9.5
|
%
|
|||
Interest expense
|
|
41,030
|
|
|
41,944
|
|
|
(914
|
)
|
|
(2.2
|
)%
|
|||
Other income, net
|
|
5,472
|
|
|
6,949
|
|
|
(1,477
|
)
|
|
(21.3
|
)%
|
|||
Income tax expense (benefit)
|
|
1,500
|
|
|
(922
|
)
|
|
2,422
|
|
|
(262.7
|
)%
|
•
|
Property Taxes, Insurance and Other. This increase is primarily due to increased insurance premiums related to our casualty and general liability policies and an increase in property taxes for the 2019/2018 Acquired Hotels offset by a decrease in property taxes for the 2019/2018 Sold Hotels.
|
•
|
Management Fees. This decrease is primarily due to reduced consolidated revenues upon which management fees are based as a result of the sale of hotel properties during the period.
|
•
|
Depreciation and Amortization. This decline is due to a decrease in depreciation expense of $6.3 million related to the hotel properties sold after December 31, 2017 and a decrease in depreciation expense of $1.0 million for the same-store portfolio as a result of assets becoming fully depreciated, partially offset by incremental depreciation associated with the 2019/2018 Acquired Hotels of $5.7 million.
|
•
|
Corporate General and Administrative. This increase is primarily due to increases in incentive compensation costs.
|
•
|
Loss on Impairment of Assets. In 2019, we recorded impairment charges on one hotel property and two land parcels to reduce the net carrying amounts of the properties to their estimated fair market values based on third-party independent appraisals and a purchase contract for the sale of one of the land parcels that is expected to be completed in 2020. In 2018, we recorded impairment charges on two land parcels to reduce the net carrying amounts of the properties to their estimated fair market values based on third-party independent appraisals.
|
•
|
Gain on Disposal of Assets. This increase is primarily due to the sale of ten hotels in 2019 for a net gain of $45.6 million compared to the sale of eight hotels in 2018 for a net gain of $42.5 million.
|
•
|
Interest Expense. Declines in base interest rates resulted in a reduction in interest expense in 2019.
|
•
|
Other Income. This decline is due to a decline in casualty recoveries of $1.5 million and additional debt transaction costs of $1.5 million offset by an increase in interest income of $1.1 million as a result of an increase in the balance of real estate loans in 2019 and an increase in tenant income of $0.5 million.
|
•
|
Income Tax Expense/Benefit. In 2019, we recorded income tax expense of $1.5 million primarily driven by the taxable income of our TRS entity for the period. In 2018, we recorded a tax benefit of $0.9 million as a result of state tax refunds in excess of our federal tax expense on the taxable income of our TRS entity for the period.
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Net income
|
|
$
|
82,348
|
|
|
$
|
91,126
|
|
|
$
|
99,521
|
|
Preferred dividends
|
|
(14,838
|
)
|
|
(16,671
|
)
|
|
(17,408
|
)
|
|||
Premium on redemption of preferred stock
|
|
—
|
|
|
(3,277
|
)
|
|
(2,572
|
)
|
|||
Loss related to non-controlling interest in joint venture
|
|
419
|
|
|
—
|
|
|
—
|
|
|||
Net income applicable to common shares and common units
|
|
67,929
|
|
|
71,178
|
|
|
79,541
|
|
|||
Real estate-related depreciation
|
|
99,013
|
|
|
100,545
|
|
|
85,524
|
|
|||
Loss on impairment of assets
|
|
2,521
|
|
|
1,075
|
|
|
—
|
|
|||
Gain on disposal of assets, net
|
|
(45,418
|
)
|
|
(41,474
|
)
|
|
(43,209
|
)
|
|||
Adjustments related to non-controlling interest in consolidated joint venture
|
|
(1,554
|
)
|
|
—
|
|
|
—
|
|
|||
FFO applicable to common shares and common units
|
|
122,491
|
|
|
131,324
|
|
|
121,856
|
|
|||
Amortization of lease-related intangible assets, net
|
|
127
|
|
|
712
|
|
|
—
|
|
|||
Amortization of deferred financing costs
|
|
1,485
|
|
|
1,973
|
|
|
2,022
|
|
|||
Amortization of franchise fees
|
|
432
|
|
|
468
|
|
|
403
|
|
|||
Equity-based compensation
|
|
6,219
|
|
|
6,665
|
|
|
5,887
|
|
|||
Hotel property acquisition costs
|
|
—
|
|
|
—
|
|
|
354
|
|
|||
Debt transaction costs
|
|
1,892
|
|
|
401
|
|
|
195
|
|
|||
Premium on redemption of preferred stock
|
|
—
|
|
|
3,277
|
|
|
2,572
|
|
|||
Non-cash interest income
|
|
(2,477
|
)
|
|
(2,045
|
)
|
|
(284
|
)
|
|||
Non-cash lease expense, net
|
|
494
|
|
|
—
|
|
|
—
|
|
|||
Casualty (recoveries) losses, net
|
|
(239
|
)
|
|
(1,786
|
)
|
|
500
|
|
|||
Non-cash income tax related to adjustment to deferred tax asset
|
|
—
|
|
|
—
|
|
|
606
|
|
|||
Adjustments related to non-controlling interest in consolidated joint venture
|
|
(68
|
)
|
|
—
|
|
|
—
|
|
|||
AFFO applicable to common shares and common units
|
|
$
|
130,356
|
|
|
$
|
140,989
|
|
|
$
|
134,111
|
|
Weighted average diluted common shares/common units (1)
|
|
104,363
|
|
|
104,315
|
|
|
100,372
|
|
|||
FFO per common share/common unit
|
|
$
|
1.17
|
|
|
$
|
1.26
|
|
|
$
|
1.21
|
|
AFFO per common share/common unit
|
|
$
|
1.25
|
|
|
$
|
1.35
|
|
|
$
|
1.34
|
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Net income
|
|
$
|
82,348
|
|
|
$
|
91,126
|
|
|
$
|
99,521
|
|
Depreciation and amortization
|
|
99,445
|
|
|
101,013
|
|
|
85,927
|
|
|||
Interest expense
|
|
41,030
|
|
|
41,944
|
|
|
29,687
|
|
|||
Interest income
|
|
(278
|
)
|
|
(229
|
)
|
|
(104
|
)
|
|||
Income tax expense (benefit)
|
|
1,500
|
|
|
(922
|
)
|
|
1,674
|
|
|||
EBITDA
|
|
224,045
|
|
|
232,932
|
|
|
216,705
|
|
|||
Loss on impairment of assets
|
|
2,521
|
|
|
1,075
|
|
|
—
|
|
|||
Gain on disposal of assets, net
|
|
(45,418
|
)
|
|
(41,474
|
)
|
|
(43,209
|
)
|
|||
EBITDAre
|
|
181,148
|
|
|
192,533
|
|
|
173,496
|
|
|||
Amortization of lease-related intangible assets, net
|
|
127
|
|
|
712
|
|
|
—
|
|
|||
Equity-based compensation
|
|
6,219
|
|
|
6,665
|
|
|
5,887
|
|
|||
Hotel property acquisition costs
|
|
—
|
|
|
—
|
|
|
354
|
|
|||
Debt transaction costs
|
|
1,892
|
|
|
401
|
|
|
195
|
|
|||
Non-cash interest income
|
|
(2,477
|
)
|
|
(2,045
|
)
|
|
(284
|
)
|
|||
Non-cash lease expense, net
|
|
494
|
|
|
—
|
|
|
—
|
|
|||
Casualty (recoveries) losses, net
|
|
(239
|
)
|
|
(1,786
|
)
|
|
500
|
|
|||
Loss related to non-controlling interest in joint venture
|
|
419
|
|
|
—
|
|
|
—
|
|
|||
Adjustments related to non-controlling interest in consolidated joint venture
|
|
(2,320
|
)
|
|
—
|
|
|
—
|
|
|||
Adjusted EBITDAre
|
|
$
|
185,263
|
|
|
$
|
196,480
|
|
|
$
|
180,148
|
|
Lender
|
|
Interest Rate
|
|
Amortization
Period (Years) |
|
Maturity Date
|
|
Number of
Encumbered Properties |
|
Principal Amount Outstanding
|
||
$600 Million Senior Unsecured Credit and Term Loan Facility (1)
|
|
|
|
|
|
|
|
|
|
|
||
Deutsche Bank AG New York Branch
|
|
|
|
|
|
|
|
|
|
|
||
$400 Million Revolver
|
|
3.41% Variable
|
|
n/a
|
|
March 31, 2023
|
|
n/a
|
|
$
|
75,000
|
|
$200 Million Term Loan
|
|
3.36% Variable
|
|
n/a
|
|
April 1, 2024
|
|
n/a
|
|
200,000
|
|
|
Total Senior Unsecured Credit and Term Loan Facility
|
|
|
|
|
|
|
|
|
|
275,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Joint Venture Credit Facility (2)
|
|
|
|
|
|
|
|
|
|
|
||
Bank of America, N.A.
|
|
|
|
|
|
|
|
|
|
|
||
$125 Million Revolver
|
|
3.91% Variable
|
|
n/a
|
|
October 8, 2023
|
|
n/a
|
|
65,000
|
|
|
$75 Million Term Loan
|
|
3.86% Variable
|
|
n/a
|
|
October 8, 2023
|
|
n/a
|
|
75,000
|
|
|
Total Joint Venture Credit Facility
|
|
|
|
|
|
|
|
|
|
140,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Unsecured Term Loans (1)
|
|
|
|
|
|
|
|
|
|
|
|
|
KeyBank National Association
|
|
|
|
|
|
|
|
|
|
|
||
Term Loan
|
|
3.36% Variable
|
|
n/a
|
|
November 25, 2022
|
|
n/a
|
|
225,000
|
|
|
KeyBank National Association
|
|
|
|
|
|
|
|
|
|
|
||
Term Loan
|
|
3.66% Variable
|
|
n/a
|
|
February 14, 2025
|
|
n/a
|
|
225,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Secured Mortgage Indebtedness
|
|
|
|
|
|
|
|
|
|
|
||
KeyBank National Association
|
|
4.46% Fixed
|
|
30
|
|
February 1, 2023
|
|
3
|
|
19,510
|
|
|
|
|
4.52% Fixed
|
|
30
|
|
April 1, 2023
|
|
3
|
|
19,992
|
|
|
|
|
4.30% Fixed
|
|
30
|
|
April 1, 2023
|
|
3
|
|
19,323
|
|
|
|
|
4.95% Fixed
|
|
30
|
|
August 1, 2023
|
|
2
|
|
34,695
|
|
|
MetaBank
|
|
4.44% Fixed
|
|
25
|
|
July 1, 2027
|
|
3
|
|
47,226
|
|
|
Bank of Cascades (3)
|
|
3.76% Variable
|
|
25
|
|
December 19, 2024
|
|
1
|
|
8,490
|
|
|
|
|
4.30% Fixed
|
|
25
|
|
December 19, 2024
|
|
—
|
|
8,490
|
|
|
Total Mortgage Loans
|
|
|
|
|
|
|
|
15
|
|
157,726
|
|
|
Total Debt
|
|
|
|
|
|
|
|
|
|
$
|
1,022,726
|
|
|
|
For the Years Ended December 31,
|
|
|
||||||||
|
|
2019
|
|
2018
|
|
Change
|
||||||
|
|
(in thousands)
|
||||||||||
Net cash provided by operating activities
|
|
$
|
148,478
|
|
|
$
|
161,651
|
|
|
$
|
(13,173
|
)
|
Net cash used in investing activities
|
|
(182,164
|
)
|
|
(63,057
|
)
|
|
(119,107
|
)
|
|||
Net cash provided by (used in) financing activities
|
|
30,963
|
|
|
(92,045
|
)
|
|
123,008
|
|
|||
Net change in cash and cash equivalents
|
|
$
|
(2,723
|
)
|
|
$
|
6,549
|
|
|
$
|
(9,272
|
)
|
•
|
Cash provided by operating activities. This decrease primarily resulted from a decrease in net income of $12.6 million, after adjusting for non-cash items, such as depreciation and amortization and gains on the sale of assets, due to the sale of hotel properties and net changes in working capital of $0.6 million primarily due to the timing of working capital changes.
|
•
|
Cash used in investing activities. This increase in cash used in investing activities is primarily due to an increase in asset acquisitions of $211.6 million, partially offset by an increase in proceeds from asset dispositions of $61.7 million, a reduction in investments in hotel properties under development of $13.4 million, a reduction in the net funding of real estate loans of $10.0 million, and a reduction in capital expenditures of $7.3 million.
|
•
|
Cash provided by (used in) financing activities. This increase is primarily due to net borrowings of $57.7 million during 2019 and capital contributions from the non-controlling interest in the joint venture of $68.7 million to fund acquisitions.
|
|
|
Payments Due By Period
|
||||||||||||||||||
|
|
Total
|
|
Less than
One Year |
|
One to Three
Years |
|
Three to Five
Years |
|
More than
Five Years |
||||||||||
Debt obligations (1)
|
|
$
|
1,022,726
|
|
|
$
|
3,742
|
|
|
$
|
233,321
|
|
|
$
|
419,427
|
|
|
$
|
366,236
|
|
Currently projected interest (2)
|
|
164,887
|
|
|
40,993
|
|
|
81,159
|
|
|
38,555
|
|
|
4,180
|
|
|||||
Operating lease obligations (3)
|
|
36,764
|
|
|
2,148
|
|
|
3,853
|
|
|
1,859
|
|
|
28,904
|
|
|||||
Purchase obligations (4)
|
|
10,535
|
|
|
10,535
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
|
$
|
1,234,912
|
|
|
$
|
57,418
|
|
|
$
|
318,333
|
|
|
$
|
459,841
|
|
|
$
|
399,320
|
|
(1)
|
Amounts shown include amortization of principal and debt maturities.
|
(2)
|
Interest payments on our variable rate debt have been estimated using the interest rates in effect at December 31, 2019, after giving effect to our interest rate swaps.
|
(3)
|
Amounts consist primarily of non-cancelable ground lease and corporate office lease obligations.
|
(4)
|
This amount represents purchase orders and executed contracts for renovation projects at our hotel properties.
|
|
|
|
|
|
|
Notional Amount
|
||
Contract date
|
|
Effective Date
|
|
Expiration Date
|
|
December 31, 2019
|
||
October 2, 2017
|
|
January 29, 2018
|
|
January 31, 2023
|
|
$
|
100,000
|
|
October 2, 2017
|
|
January 29, 2018
|
|
January 31, 2023
|
|
100,000
|
|
|
June 11, 2018
|
|
September 28, 2018
|
|
September 30, 2024
|
|
75,000
|
|
|
June 11, 2018
|
|
December 31, 2018
|
|
December 31, 2025
|
|
125,000
|
|
|
|
|
|
|
|
|
$
|
400,000
|
|
•
|
pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets;
|
•
|
provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP and that our receipts and our expenditures are being made only in accordance with authorizations of our management and our board of directors; and
|
•
|
provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on our financial statements.
|
Plan Category
|
|
Number of Securities to
be Issued Upon Exercise of Outstanding Options |
|
Weighted Average
Exercise Price of Outstanding Options |
|
Number of Securities
Remaining Available for Future Issuance Under Equity Compensation Plans (1) |
||||
Equity Compensation Plans Approved by Summit Hotel Properties, Inc. Stockholders (2)
|
|
235,000
|
|
|
$
|
9.75
|
|
|
1,844,221
|
|
Equity Compensation Plans Not Approved by Summit Hotel Properties, Inc. Stockholders
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Total
|
|
235,000
|
|
|
$
|
9.75
|
|
|
1,844,221
|
|
Period
|
|
Total Shares Purchased
|
|
Average Price Paid Per Share
|
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
|
|
Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs
|
|||||
March 1, 2019 - March 31, 2019
|
|
73,892
|
|
|
$
|
11.29
|
|
|
—
|
|
|
—
|
|
May 1, 2019 - May 31, 2019
|
|
448
|
|
|
$
|
11.74
|
|
|
—
|
|
|
—
|
|
Total
|
|
74,340
|
|
|
|
|
—
|
|
|
|
Exhibit
Number
|
|
Description of Exhibit
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
101.INS(1)
|
|
XBRL Instance Document
|
101.SCH(1)
|
|
XBRL Taxonomy Extension Schema Document
|
101.CAL(1)
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF(1)
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB(1)
|
|
XBRL Taxonomy Extension Labels Linkbase Document
|
101.PRE(1)
|
|
XBRL Taxonomy Presentation Linkbase Document
|
104(1)
|
|
The cover page for Summit Hotel Properties, Inc.'s Annual Report on Form 10-K for the year ended December 31, 2019 (formatted in Inline XBRL and contained in Exhibit 101).
|
|
SUMMIT HOTEL PROPERTIES, INC. (registrant)
|
|
|
|
|
Date: February 25, 2020
|
By:
|
/s/ Daniel P. Hansen
|
|
|
Daniel P. Hansen
|
|
|
Chairman of the Board of Directors
|
|
|
President and Chief Executive Officer
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
/s/ Daniel P. Hansen
|
|
Chairman of the Board of Directors,
President and Chief Executive Officer
|
|
February 25, 2020
|
Daniel P. Hansen
|
|
(principal executive officer)
|
|
|
|
|
|
|
|
/s/ Jonathan P. Stanner
|
|
Executive Vice President, Chief Financial Officer and Treasurer
|
|
February 25, 2020
|
Jonathan P. Stanner
|
|
(principal financial officer)
|
|
|
|
|
|
|
|
/s/ Paul Ruiz
|
|
Senior Vice President and Chief Accounting Officer
|
|
February 25, 2020
|
Paul Ruiz
|
|
(principal accounting officer)
|
|
|
|
|
|
|
|
/s/ Bjorn R. L. Hanson
|
|
Director
|
|
February 25, 2020
|
Bjorn R. L. Hanson
|
|
|
|
|
|
|
|
|
|
/s/ Jeffrey W. Jones
|
|
Director
|
|
February 25, 2020
|
Jeffrey W. Jones
|
|
|
|
|
|
|
|
|
|
/s/ Kenneth J. Kay
|
|
Director
|
|
February 25, 2020
|
Kenneth J. Kay
|
|
|
|
|
|
|
|
|
|
/s/ Thomas W. Storey
|
|
Director
|
|
February 25, 2020
|
Thomas W. Storey
|
|
|
|
|
|
|
|
|
|
/s/ Hope S. Taitz
|
|
Director
|
|
February 25, 2020
|
Hope S. Taitz
|
|
|
|
|
|
Page
|
|
|
|
Loss on Impairment of Assets
|
Description of the Matter
|
Investment in hotel properties, net, including hotel properties under development and land held for development totaled $2.2 billion at December 31, 2019. For the year ended December 31, 2019, the Company recorded impairment losses of $2.5 million. As explained in Note 2 of the consolidated financial statements, hotel properties are evaluated by management for impairment when indicators are present. When such indicators are identified, management prepares a recoverability analysis using undiscounted cash flows and if this analysis fails, management recognizes an impairment when the estimated fair value of the property is less than the carrying value.
Auditing the undiscounted property cash flow analysis was complex and involved a high degree of subjectivity, primarily around future growth rates used in the Company’s analysis, which can be affected by future market or economic conditions. Auditing the estimated fair value of properties that fail the recoverability analysis was complex and involved a high degree of subjectivity, primarily around the market assumptions and comparable sales figures used in the appraisal obtained by the Company to estimate the fair value of the underlying properties.
|
How We Addressed the Matter in Our Audit
|
We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the Company's process to determine (1) hotel properties with impairment indicators, (2) undiscounted cash flows for each identified property and (3) the fair value of hotel properties that did not pass the test of recoverability. For example, we tested controls over management’s review of triggering events and the significant assumptions, such as growth rates in future cash flows, used in the test for recoverability.
To test the undiscounted cash flow analysis, our audit procedures included, among others, evaluating the Company's methodology, testing the future growth rate assumptions used to develop the forecasted cash flows and testing the completeness and accuracy of the underlying data. For example, we compared the future growth rates to current industry, market and economic trends, and historical results of the Company's business. We performed a sensitivity analysis of the future growth rates to evaluate the change in the recoverability analysis of the hotel properties resulting from changes in the assumptions. We also involved a valuation specialist to assist in our evaluation of the key assumptions used in the analysis, such as future growth rates and occupancy rates, and to perform a comparability assessment of the Company’s approach to value using observable market information. To test the fair value of the properties that did not pass the recoverability analysis, our audit procedures included, among others, involving a specialist to perform corroborative calculations using observable market data to develop an independent range of values to compare against the Company’s third-party appraisal. Our audit procedures further involved validating the completeness and accuracy of the net book value and historical financial information for the properties that were appraised.
|
|
Hotel Property Acquisitions
|
Description of the Matter
|
During 2019, the Company completed its acquisition of five hotel properties for net consideration of $274.5 million, as disclosed in Note 3 to the consolidated financial statements. The transactions were accounted for as asset acquisitions. Determining the fair value of the individual assets acquired requires management to make significant judgments about the valuation methodologies (i.e., market approach or cost approach) and inputs to the model.
Auditing the Company's accounting for its acquisitions of the five hotel properties was complex due to the significant estimation required by management to determine the fair value of the acquired land and hotel buildings and improvements. The significant assumptions used to estimate the value of these assets included (1) adjustments to market data to account for any transaction differences between the acquired land parcel and observable market transactions, and (2) estimating replacement costs for each hotel building and improvement, including estimating useful lives taking into consideration the physical condition of the assets at acquisition, and making adjustments to account for any transaction differences.
|
How We Addressed the Matter in Our Audit
|
We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the Company's accounting for asset acquisitions process, including controls over the Company’s valuation of the acquired assets. For example, we tested the Company's controls over the determination of the fair value of the land and hotel buildings and improvements, including the valuation models and underlying assumptions used to develop such estimates.
To test the estimated fair value of the land and hotel buildings and site improvements our audit procedures included, among others, reading the purchase agreement, assessing the appropriateness of the valuation methodologies, evaluating the reasonableness of the significant assumptions discussed above and testing the completeness and accuracy of the underlying data used by the Company. We involved our valuation specialist to assist with our evaluation of the methodologies used by the Company and significant assumptions included in the fair value estimates. For example, we compared the significant assumptions to current industry, market and economic trends, to the assumptions used to value similar assets in other acquisitions in the same industry and evaluating whether assumptions used by management were reasonable considering consistency with external market and industry data. Specifically, for the market approach, we developed an independent range of fair values based on observable market transactions to compare to the Company’s conclusion on fair value. For the cost approach, we compared the replacement cost and estimated useful life for the hotel building and improvements to observable market information, taking into consideration the physical condition of the assets at the time of acquisition. We also performed sensitivity analyses of the estimated useful life assumptions to evaluate the change in the fair value resulting from changes in the assumptions.
|
|
|
December 31,
|
||||||
|
|
2019
|
|
2018
|
||||
ASSETS
|
|
|
|
|
|
|
||
Investment in hotel properties, net
|
|
$
|
2,184,232
|
|
|
$
|
2,065,554
|
|
Undeveloped land
|
|
1,500
|
|
|
2,267
|
|
||
Assets held for sale, net
|
|
425
|
|
|
7,633
|
|
||
Investment in real estate loans, net
|
|
30,936
|
|
|
30,700
|
|
||
Right-of-use assets
|
|
29,884
|
|
|
—
|
|
||
Cash and cash equivalents
|
|
42,238
|
|
|
44,088
|
|
||
Restricted cash
|
|
27,595
|
|
|
28,468
|
|
||
Trade receivables, net
|
|
13,281
|
|
|
13,978
|
|
||
Prepaid expenses and other
|
|
8,844
|
|
|
10,111
|
|
||
Deferred charges, net
|
|
4,709
|
|
|
4,691
|
|
||
Other assets
|
|
12,039
|
|
|
14,807
|
|
||
Total assets
|
|
$
|
2,355,683
|
|
|
$
|
2,222,297
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
||
Liabilities:
|
|
|
|
|
|
|
||
Debt, net of debt issuance costs
|
|
$
|
1,016,163
|
|
|
$
|
958,712
|
|
Lease liabilities
|
|
19,604
|
|
|
—
|
|
||
Accounts payable
|
|
4,767
|
|
|
5,391
|
|
||
Accrued expenses and other
|
|
71,759
|
|
|
66,050
|
|
||
Total liabilities
|
|
1,112,293
|
|
|
1,030,153
|
|
||
Commitments and contingencies (Note 11)
|
|
|
|
|
|
|
||
Equity:
|
|
|
|
|
|
|
||
Preferred stock, $0.01 par value per share, 100,000,000 shares authorized:
|
|
|
|
|
|
|
||
6.45% Series D - 3,000,000 shares issued and outstanding at December 31, 2019 and 2018 (aggregate liquidation preference of $75,417 at December 31, 2019 and 2018)
|
|
30
|
|
|
30
|
|
||
6.25% Series E - 6,400,000 shares issued and outstanding at December 31, 2019 and 2018 (aggregate liquidation preference of $160,861 at December 31, 2019 and 2018)
|
|
64
|
|
|
64
|
|
||
Common stock, $0.01 par value per share, 500,000,000 shares authorized, 105,169,515 and 104,783,179 shares issued and outstanding at December 31, 2019 and 2018, respectively
|
|
1,052
|
|
|
1,048
|
|
||
Additional paid-in capital
|
|
1,190,949
|
|
|
1,185,310
|
|
||
Accumulated other comprehensive loss
|
|
(16,034
|
)
|
|
(1,441
|
)
|
||
(Distributions in excess of retained earnings) retained earnings
|
|
(2,283
|
)
|
|
4,838
|
|
||
Total stockholders’ equity
|
|
1,173,778
|
|
|
1,189,849
|
|
||
Non-controlling interests in operating partnership
|
|
1,809
|
|
|
2,295
|
|
||
Non-controlling interests in joint venture (Note 9)
|
|
67,803
|
|
|
—
|
|
||
Total equity
|
|
1,243,390
|
|
|
1,192,144
|
|
||
Total liabilities and equity
|
|
$
|
2,355,683
|
|
|
$
|
2,222,297
|
|
|
|
For the Years Ended December 31,
|
||||||||||
|
|
2019
|
|
2018
|
|
2017
|
||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|||
Room
|
|
$
|
505,342
|
|
|
$
|
523,439
|
|
|
$
|
479,934
|
|
Food and beverage
|
|
23,785
|
|
|
24,225
|
|
|
21,359
|
|
|||
Other
|
|
20,221
|
|
|
19,606
|
|
|
14,084
|
|
|||
Total revenues
|
|
549,348
|
|
|
567,270
|
|
|
515,377
|
|
|||
Expenses:
|
|
|
|
|
|
|
|
|
|
|||
Room
|
|
112,244
|
|
|
119,724
|
|
|
108,715
|
|
|||
Food and beverage
|
|
18,552
|
|
|
19,191
|
|
|
16,734
|
|
|||
Other hotel operating expenses
|
|
158,181
|
|
|
159,173
|
|
|
144,526
|
|
|||
Property taxes, insurance and other
|
|
44,220
|
|
|
43,339
|
|
|
37,419
|
|
|||
Management fees
|
|
16,575
|
|
|
18,521
|
|
|
18,210
|
|
|||
Depreciation and amortization
|
|
99,445
|
|
|
101,013
|
|
|
85,927
|
|
|||
Corporate general and administrative
|
|
23,622
|
|
|
21,509
|
|
|
19,597
|
|
|||
Hotel property acquisition costs
|
|
—
|
|
|
—
|
|
|
354
|
|
|||
Loss on impairment of assets
|
|
2,521
|
|
|
1,075
|
|
|
—
|
|
|||
Total expenses
|
|
475,360
|
|
|
483,545
|
|
|
431,482
|
|
|||
Gain on disposal of assets, net
|
|
45,418
|
|
|
41,474
|
|
|
43,209
|
|
|||
Operating income
|
|
119,406
|
|
|
125,199
|
|
|
127,104
|
|
|||
Other income (expense):
|
|
|
|
|
|
|
|
|
|
|||
Interest expense
|
|
(41,030
|
)
|
|
(41,944
|
)
|
|
(29,687
|
)
|
|||
Other income, net
|
|
5,472
|
|
|
6,949
|
|
|
3,778
|
|
|||
Total other expense
|
|
(35,558
|
)
|
|
(34,995
|
)
|
|
(25,909
|
)
|
|||
Income from continuing operations before income taxes
|
|
83,848
|
|
|
90,204
|
|
|
101,195
|
|
|||
Income tax (expense) benefit (Note 14)
|
|
(1,500
|
)
|
|
922
|
|
|
(1,674
|
)
|
|||
Net income
|
|
82,348
|
|
|
91,126
|
|
|
99,521
|
|
|||
Less: (Income) loss attributable to non-controlling interests:
|
|
|
|
|
|
|
|
|
|
|||
Operating Partnership
|
|
(157
|
)
|
|
(205
|
)
|
|
(307
|
)
|
|||
Joint venture
|
|
419
|
|
|
—
|
|
|
—
|
|
|||
Net income attributable to Summit Hotel Properties, Inc.
|
|
82,610
|
|
|
90,921
|
|
|
99,214
|
|
|||
Preferred dividends
|
|
(14,838
|
)
|
|
(16,671
|
)
|
|
(17,408
|
)
|
|||
Premium on redemption of preferred stock
|
|
—
|
|
|
(3,277
|
)
|
|
(2,572
|
)
|
|||
Net income attributable to common stockholders
|
|
$
|
67,772
|
|
|
$
|
70,973
|
|
|
$
|
79,234
|
|
Earnings per share:
|
|
|
|
|
|
|
|
|
|
|||
Basic and diluted
|
|
$
|
0.65
|
|
|
$
|
0.68
|
|
|
$
|
0.79
|
|
Weighted average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|||
Basic
|
|
103,887
|
|
|
103,623
|
|
|
99,406
|
|
|||
Diluted
|
|
103,939
|
|
|
103,842
|
|
|
99,780
|
|
|||
Dividends per share
|
|
$
|
0.72
|
|
|
$
|
0.72
|
|
|
$
|
0.67
|
|
|
|
For the Years Ended December 31,
|
||||||||||
|
|
2019
|
|
2018
|
|
2017
|
||||||
Net income
|
|
$
|
82,348
|
|
|
$
|
91,126
|
|
|
$
|
99,521
|
|
Other comprehensive income, net of tax:
|
|
|
|
|
|
|
|
|
|
|||
Changes in fair value of derivative financial instruments
|
|
(14,596
|
)
|
|
(2,900
|
)
|
|
2,437
|
|
|||
Comprehensive income
|
|
67,752
|
|
|
88,226
|
|
|
101,958
|
|
|||
Comprehensive (income) loss attributable to non-controlling interests:
|
|
|
|
|
|
|
|
|
|
|||
Operating Partnership
|
|
(123
|
)
|
|
(197
|
)
|
|
(316
|
)
|
|||
Joint venture
|
|
419
|
|
|
—
|
|
|
—
|
|
|||
Comprehensive income attributable to Summit Hotel Properties, Inc.
|
|
68,048
|
|
|
88,029
|
|
|
101,642
|
|
|||
Preferred dividends
|
|
(14,838
|
)
|
|
(16,671
|
)
|
|
(17,408
|
)
|
|||
Premium on redemption of preferred stock
|
|
—
|
|
|
(3,277
|
)
|
|
(2,572
|
)
|
|||
Comprehensive income attributable to common stockholders
|
|
$
|
53,210
|
|
|
$
|
68,081
|
|
|
$
|
81,662
|
|
|
|
Shares of Preferred
Stock
|
|
Preferred
Stock
|
|
Shares of
Common
Stock
|
|
Common
Stock
|
|
Additional
Paid-In
Capital
|
|
Accumulated
Other Comprehensive
Income
(Loss)
|
|
Retained Earnings (Distributions in Excess of Retained Earnings)
|
|
Total Shareholders’
Equity
|
|
Non-controlling
Interests
|
|
|||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
Operating
Partnership
|
|
Joint
Venture
|
|
Total
Equity
|
||||||||||||||||||||||||||||
Balance at December 31, 2016
|
|
9,400,000
|
|
|
$
|
94
|
|
|
93,525,469
|
|
|
$
|
935
|
|
|
$
|
1,011,412
|
|
|
$
|
(977
|
)
|
|
$
|
(1,422
|
)
|
|
$
|
1,010,042
|
|
|
$
|
3,428
|
|
|
$
|
—
|
|
|
$
|
1,013,470
|
|
Net proceeds from sale of common stock
|
|
—
|
|
|
—
|
|
|
10,350,000
|
|
|
104
|
|
|
163,471
|
|
|
—
|
|
|
—
|
|
|
163,575
|
|
|
—
|
|
|
—
|
|
|
163,575
|
|
|||||||||
Net proceeds from sale of preferred stock
|
|
6,400,000
|
|
|
64
|
|
|
—
|
|
|
—
|
|
|
154,668
|
|
|
—
|
|
|
—
|
|
|
154,732
|
|
|
—
|
|
|
—
|
|
|
154,732
|
|
|||||||||
Redemption of preferred stock
|
|
(3,000,000
|
)
|
|
(30
|
)
|
|
—
|
|
|
—
|
|
|
(72,423
|
)
|
|
—
|
|
|
(2,572
|
)
|
|
(75,025
|
)
|
|
—
|
|
|
—
|
|
|
(75,025
|
)
|
|||||||||
Common stock redemption of common units
|
|
—
|
|
|
—
|
|
|
73,322
|
|
|
1
|
|
|
650
|
|
|
—
|
|
|
—
|
|
|
651
|
|
|
(651
|
)
|
|
—
|
|
|
—
|
|
|||||||||
Dividends
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(86,019
|
)
|
|
(86,019
|
)
|
|
(241
|
)
|
|
—
|
|
|
(86,260
|
)
|
|||||||||
Equity-based compensation
|
|
—
|
|
|
—
|
|
|
397,448
|
|
|
4
|
|
|
5,861
|
|
|
—
|
|
|
—
|
|
|
5,865
|
|
|
22
|
|
|
—
|
|
|
5,887
|
|
|||||||||
Shares acquired for employee withholding requirements
|
|
—
|
|
|
—
|
|
|
(59,111
|
)
|
|
(1
|
)
|
|
(960
|
)
|
|
—
|
|
|
—
|
|
|
(961
|
)
|
|
—
|
|
|
—
|
|
|
(961
|
)
|
|||||||||
Other comprehensive income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,428
|
|
|
—
|
|
|
2,428
|
|
|
9
|
|
|
—
|
|
|
2,437
|
|
|||||||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
99,214
|
|
|
99,214
|
|
|
307
|
|
|
—
|
|
|
99,521
|
|
|||||||||
Balance at December 31, 2017
|
|
12,800,000
|
|
|
128
|
|
|
104,287,128
|
|
|
1,043
|
|
|
1,262,679
|
|
|
1,451
|
|
|
9,201
|
|
|
1,274,502
|
|
|
2,874
|
|
|
—
|
|
|
1,277,376
|
|
|||||||||
Redemption of preferred stock
|
|
(3,400,000
|
)
|
|
(34
|
)
|
|
—
|
|
|
—
|
|
|
(81,689
|
)
|
|
—
|
|
|
(3,277
|
)
|
|
(85,000
|
)
|
|
—
|
|
|
—
|
|
|
(85,000
|
)
|
|||||||||
Common stock redemption of common units
|
|
—
|
|
|
—
|
|
|
64,126
|
|
|
1
|
|
|
576
|
|
|
—
|
|
|
—
|
|
|
577
|
|
|
(577
|
)
|
|
—
|
|
|
—
|
|
|||||||||
Dividends
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(92,007
|
)
|
|
(92,007
|
)
|
|
(218
|
)
|
|
—
|
|
|
(92,225
|
)
|
|||||||||
Equity-based compensation
|
|
—
|
|
|
—
|
|
|
619,775
|
|
|
6
|
|
|
6,640
|
|
|
—
|
|
|
—
|
|
|
6,646
|
|
|
19
|
|
|
—
|
|
|
6,665
|
|
|||||||||
Shares acquired for employee withholding requirements
|
|
—
|
|
|
—
|
|
|
(187,850
|
)
|
|
(2
|
)
|
|
(2,722
|
)
|
|
—
|
|
|
—
|
|
|
(2,724
|
)
|
|
—
|
|
|
—
|
|
|
(2,724
|
)
|
|||||||||
Other
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(174
|
)
|
|
—
|
|
|
—
|
|
|
(174
|
)
|
|
—
|
|
|
—
|
|
|
(174
|
)
|
|||||||||
Other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,892
|
)
|
|
—
|
|
|
(2,892
|
)
|
|
(8
|
)
|
|
—
|
|
|
(2,900
|
)
|
|||||||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
90,921
|
|
|
90,921
|
|
|
205
|
|
|
—
|
|
|
91,126
|
|
|||||||||
Balance at December 31, 2018
|
|
9,400,000
|
|
|
94
|
|
|
104,783,179
|
|
|
1,048
|
|
|
1,185,310
|
|
|
(1,441
|
)
|
|
4,838
|
|
|
1,189,849
|
|
|
2,295
|
|
|
—
|
|
|
1,192,144
|
|
|||||||||
Contribution by non-controlling interest in joint venture
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
68,712
|
|
|
68,712
|
|
|||||||||
Common stock redemption of common units
|
|
—
|
|
|
—
|
|
|
50,244
|
|
|
1
|
|
|
475
|
|
|
(31
|
)
|
|
—
|
|
|
445
|
|
|
(445
|
)
|
|
—
|
|
|
—
|
|
|||||||||
Dividends
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(89,731
|
)
|
|
(89,731
|
)
|
|
(178
|
)
|
|
(490
|
)
|
|
(90,399
|
)
|
|||||||||
Equity-based compensation
|
|
—
|
|
|
—
|
|
|
410,432
|
|
|
4
|
|
|
6,201
|
|
|
—
|
|
|
—
|
|
|
6,205
|
|
|
14
|
|
|
—
|
|
|
6,219
|
|
|||||||||
Shares acquired for employee withholding requirements
|
|
—
|
|
|
—
|
|
|
(74,340
|
)
|
|
(1
|
)
|
|
(838
|
)
|
|
—
|
|
|
—
|
|
|
(839
|
)
|
|
—
|
|
|
—
|
|
|
(839
|
)
|
|||||||||
Other
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(199
|
)
|
|
—
|
|
|
—
|
|
|
(199
|
)
|
|
—
|
|
|
—
|
|
|
(199
|
)
|
|||||||||
Other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(14,562
|
)
|
|
—
|
|
|
(14,562
|
)
|
|
(34
|
)
|
|
—
|
|
|
(14,596
|
)
|
|||||||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
82,610
|
|
|
82,610
|
|
|
157
|
|
|
(419
|
)
|
|
82,348
|
|
|||||||||
Balance at December 31, 2019
|
|
9,400,000
|
|
|
$
|
94
|
|
|
105,169,515
|
|
|
$
|
1,052
|
|
|
$
|
1,190,949
|
|
|
$
|
(16,034
|
)
|
|
$
|
(2,283
|
)
|
|
$
|
1,173,778
|
|
|
$
|
1,809
|
|
|
$
|
67,803
|
|
|
$
|
1,243,390
|
|
|
|
For the Years Ended December 31,
|
||||||||||
|
|
2019
|
|
2018
|
|
2017
|
||||||
OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|||
Net income
|
|
$
|
82,348
|
|
|
$
|
91,126
|
|
|
$
|
99,521
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
|
|
|
|||
Depreciation and amortization
|
|
99,445
|
|
|
101,013
|
|
|
85,927
|
|
|||
Amortization of deferred financing costs
|
|
1,485
|
|
|
1,973
|
|
|
2,022
|
|
|||
Loss on impairment of assets
|
|
2,521
|
|
|
1,075
|
|
|
—
|
|
|||
Equity-based compensation
|
|
6,219
|
|
|
6,665
|
|
|
5,887
|
|
|||
Deferred tax asset, net
|
|
(12
|
)
|
|
(430
|
)
|
|
887
|
|
|||
Realization of deferred gain
|
|
—
|
|
|
—
|
|
|
(15,000
|
)
|
|||
Gain on disposal of assets, net
|
|
(45,418
|
)
|
|
(41,474
|
)
|
|
(28,209
|
)
|
|||
Non-cash interest income
|
|
(2,477
|
)
|
|
(2,045
|
)
|
|
(284
|
)
|
|||
Debt transaction costs
|
|
1,892
|
|
|
401
|
|
|
195
|
|
|||
Other
|
|
469
|
|
|
770
|
|
|
285
|
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|||
Trade receivables, net
|
|
511
|
|
|
2,787
|
|
|
(5,032
|
)
|
|||
Prepaid expenses and other
|
|
552
|
|
|
(1,127
|
)
|
|
(2,454
|
)
|
|||
Accounts payable
|
|
(314
|
)
|
|
(424
|
)
|
|
(491
|
)
|
|||
Accrued expenses and other
|
|
1,257
|
|
|
1,341
|
|
|
4,595
|
|
|||
NET CASH PROVIDED BY OPERATING ACTIVITIES
|
|
148,478
|
|
|
161,651
|
|
|
147,849
|
|
|||
INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|||
Acquisitions of hotel properties and land
|
|
(282,557
|
)
|
|
(71,002
|
)
|
|
(588,822
|
)
|
|||
Improvements to hotel properties
|
|
(59,268
|
)
|
|
(66,610
|
)
|
|
(37,191
|
)
|
|||
Investment in hotel properties under development
|
|
—
|
|
|
(13,430
|
)
|
|
(20,993
|
)
|
|||
Proceeds from asset dispositions, net
|
|
165,724
|
|
|
104,030
|
|
|
120,733
|
|
|||
Funding of real estate loans
|
|
(8,363
|
)
|
|
(16,245
|
)
|
|
(17,935
|
)
|
|||
Proceeds from principal payments on real estate loans
|
|
2,300
|
|
|
200
|
|
|
32,500
|
|
|||
NET CASH USED IN INVESTING ACTIVITIES
|
|
(182,164
|
)
|
|
(63,057
|
)
|
|
(511,708
|
)
|
|||
FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|||
Proceeds from issuance of debt
|
|
360,000
|
|
|
815,000
|
|
|
667,640
|
|
|||
Principal payments on debt
|
|
(302,287
|
)
|
|
(723,098
|
)
|
|
(452,082
|
)
|
|||
Proceeds from equity offerings, net of issuance costs
|
|
—
|
|
|
—
|
|
|
318,307
|
|
|||
Redemption of preferred stock
|
|
—
|
|
|
(85,000
|
)
|
|
(75,025
|
)
|
|||
Dividends paid
|
|
(90,783
|
)
|
|
(92,245
|
)
|
|
(85,635
|
)
|
|||
Proceeds from contribution by joint venture partner
|
|
68,712
|
|
|
—
|
|
|
—
|
|
|||
Financing fees on debt and other issuance costs
|
|
(3,840
|
)
|
|
(3,978
|
)
|
|
(1,953
|
)
|
|||
Repurchase of common shares for withholding requirements
|
|
(839
|
)
|
|
(2,724
|
)
|
|
(961
|
)
|
|||
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES
|
|
30,963
|
|
|
(92,045
|
)
|
|
370,291
|
|
|||
Net change in cash, cash equivalents and restricted cash
|
|
(2,723
|
)
|
|
6,549
|
|
|
6,432
|
|
|||
CASH, CASH EQUIVALENTS AND RESTRICTED CASH
|
|
|
|
|
|
|
|
|
|
|||
Beginning of period
|
|
72,556
|
|
|
66,007
|
|
|
59,575
|
|
|||
End of period
|
|
$
|
69,833
|
|
|
$
|
72,556
|
|
|
$
|
66,007
|
|
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
|
|
|
|
|
|
|
|
|
|
|||
Cash payments for interest
|
|
$
|
41,648
|
|
|
$
|
38,743
|
|
|
$
|
27,362
|
|
Accrued improvements to hotel properties
|
|
$
|
4,856
|
|
|
$
|
6,084
|
|
|
$
|
7,074
|
|
Capitalized interest
|
|
$
|
—
|
|
|
$
|
446
|
|
|
$
|
301
|
|
Cash payments for income taxes, net of refunds
|
|
$
|
(229
|
)
|
|
$
|
839
|
|
|
$
|
623
|
|
Classification
|
|
Estimated Useful Lives
|
Buildings and improvements
|
|
6 to 40 years
|
Furniture, fixtures and equipment
|
|
2 to 15 years
|
Level 1:
|
|
Observable inputs such as quoted prices in active markets.
|
Level 2:
|
|
Directly or indirectly observable inputs, other than quoted prices in active markets.
|
Level 3:
|
|
Unobservable inputs in which there is little or no market information, which require a reporting entity to develop its own assumptions.
|
Market approach:
|
|
Prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities.
|
Cost approach:
|
|
Amount required to replace the service capacity of an asset (replacement cost).
|
Income approach:
|
|
Techniques used to convert future amounts to a single amount based on market expectations (including present-value, option-pricing, and excess-earnings models).
|
|
|
2019
|
|
2018
|
||||
Land
|
|
$
|
319,603
|
|
|
$
|
288,833
|
|
Hotel buildings and improvements
|
|
2,049,384
|
|
|
1,916,194
|
|
||
Furniture, fixtures and equipment
|
|
173,128
|
|
|
165,026
|
|
||
Construction in progress
|
|
9,388
|
|
|
21,059
|
|
||
Intangible assets
|
|
11,231
|
|
|
22,064
|
|
||
Real estate development loan
|
|
5,485
|
|
|
—
|
|
||
|
|
2,568,219
|
|
|
2,413,176
|
|
||
Less - accumulated depreciation
|
|
(383,987
|
)
|
|
(347,622
|
)
|
||
|
|
$
|
2,184,232
|
|
|
$
|
2,065,554
|
|
|
|
Weighted Average Amortization Period (in Years)
|
|
2019
|
|
2018
|
||||
Intangible assets:
|
|
|
|
|
|
|
||||
Air rights (1)
|
|
n/a
|
|
$
|
10,754
|
|
|
$
|
10,754
|
|
Favorable leases (2)
|
|
n/a
|
|
—
|
|
|
10,550
|
|
||
In-place lease agreements
|
|
2.0
|
|
397
|
|
|
680
|
|
||
Other
|
|
n/a
|
|
80
|
|
|
80
|
|
||
|
|
|
|
11,231
|
|
|
22,064
|
|
||
Less - accumulated amortization
|
|
|
|
(224
|
)
|
|
(1,108
|
)
|
||
Intangible assets, net
|
|
|
|
$
|
11,007
|
|
|
$
|
20,956
|
|
(1)
|
In conjunction with the acquisition of the Courtyard by Marriott - Charlotte, NC, the Company acquired certain air rights related to the hotel property.
|
(2)
|
In accordance with ASU No. 2016-02, Leases (Topic 842), we reclassified certain existing lease-related intangible assets to Right-of-use assets as of January 1, 2019 (See "Note 7 - Leases" for further information).
|
|
|
Finite-Lived Intangible Assets
|
||
2020
|
|
$
|
87
|
|
2021
|
|
86
|
|
|
|
|
$
|
173
|
|
Date Acquired
|
|
Franchise/Brand
|
|
Location
|
|
Guestrooms
|
|
Purchase
Price |
|
|||
Year Ended December 31, 2019
|
|
|
|
|
|
|
|
|||||
August 6, 2019
|
|
Hampton Inn & Suites
|
|
Silverthorne, CO
|
|
88
|
|
|
$
|
25,500
|
|
|
October 8, 2019
|
|
Portfolio Purchase - four properties(1)
|
|
various(1)
|
|
710
|
|
|
249,000
|
|
|
|
|
|
|
|
|
|
798
|
|
|
$
|
274,500
|
|
(2)
|
|
|
|
|
|
|
|
|
|
|
|||
Year Ended December 31, 2018
|
|
|
|
|
|
|
|
|
|
|||
September 12, 2018
|
|
Residence Inn by Marriott
|
|
Boston (Watertown), MA
|
|
150
|
|
|
$
|
71,000
|
|
|
|
|
|
|
|
|
150
|
|
|
$
|
71,000
|
|
(3)
|
(2)
|
The net assets acquired in 2019 were purchased for $274.5 million plus the purchase of adjacent land parcels totaling $2.4 million, $1.0 million of net working capital assets and capitalized transaction costs of $0.4 million. We own a 51% controlling interest in these hotel properties through a consolidated joint venture.
|
(3)
|
The net assets acquired in 2018 were purchased for $71.0 million plus the purchase at settlement of $0.1 million of net working capital liabilities and capitalized transaction costs of $0.1 million.
|
|
|
2019
|
|
2018
|
||||
Land
|
|
$
|
44,868
|
|
|
$
|
25,083
|
|
Hotel buildings and improvements
|
|
219,410
|
|
|
42,676
|
|
||
Furniture, fixtures and equipment
|
|
12,995
|
|
|
3,300
|
|
||
Other assets
|
|
1,103
|
|
|
123
|
|
||
Total assets acquired
|
|
278,376
|
|
|
71,182
|
|
||
Less other liabilities
|
|
(79
|
)
|
|
(180
|
)
|
||
Net assets acquired (1) (2)
|
|
$
|
278,297
|
|
|
$
|
71,002
|
|
(1)
|
The net assets acquired in 2019 were purchased for $274.5 million plus the purchase of adjacent land parcels totaling $2.4 million, $1.0 million of net working capital assets and capitalized transaction costs of $0.4 million.
|
(2)
|
The net assets acquired in 2018 were purchased for $71.0 million plus the purchase at settlement of $0.1 million of net working capital liabilities and capitalized transaction costs of $0.1 million.
|
|
|
2019
|
|
2018
|
||||
Revenues
|
|
$
|
572,262
|
|
|
$
|
562,097
|
|
Income from hotel operations
|
|
$
|
215,372
|
|
|
$
|
215,931
|
|
Net income (1)
|
|
$
|
57,909
|
|
|
$
|
71,478
|
|
Net income attributable to common stockholders, net of amount allocated to participating securities and non-controlling interests (1) (2)
|
|
$
|
33,671
|
|
|
$
|
38,803
|
|
Basic and diluted net income per share attributable to common stockholders (1) (2)
|
|
$
|
0.32
|
|
|
$
|
0.37
|
|
(1)
|
Unaudited pro forma amounts include depreciation expense, property tax expense, interest expense, income tax expense, and corporate general and administrative expenses totaling $197.1 million and $181.9 million for the twelve months ended December 31, 2019 and 2018, respectively.
|
(2)
|
Unaudited pro forma amounts for the twelve months ended December 31, 2018 include the effect of the premium on redemption of preferred stock of $3.3 million and higher preferred dividends of $1.8 million related to the redeemed preferred stock.
|
Disposition Date
|
|
Franchise/Brand
|
|
Location
|
|
Guestrooms
|
|
Gross Sales Price
|
|
Aggregate Gain, net
|
|||||
Year Ended December 31, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
February 12, 2019
|
|
Portfolio Sale - two properties(1)
|
|
Charleston, WV (1)
|
|
130
|
|
|
$
|
11,600
|
|
|
$
|
4,163
|
|
April 17, 2019
|
|
Portfolio Sale - six properties (2)
|
|
various (2)
|
|
815
|
|
|
135,000
|
|
|
36,626
|
|
||
November 8, 2019
|
|
Portfolio Sale - two properties (3)
|
|
Birmingham, AL (3)
|
|
225
|
|
|
21,800
|
|
|
4,857
|
|
||
Total
|
|
|
|
|
|
1,170
|
|
|
$
|
168,400
|
|
|
$
|
45,646
|
|
Year Ended December 31, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
June 29, 2018
|
|
Portfolio Sale - two properties(4)
|
|
various (4)
|
|
175
|
|
|
$
|
18,950
|
|
|
$
|
13,133
|
|
June 29, 2018
|
|
Portfolio Sale - two properties (5)
|
|
Duluth, GA (5)
|
|
265
|
|
|
24,850
|
|
|
4,218
|
|
||
July 24, 2018
|
|
Portfolio Sale - three properties (6)
|
|
various (6)
|
|
322
|
|
|
46,500
|
|
|
22,964
|
|
||
September 28, 2018
|
|
Hyatt Place
|
|
Fort Myers, FL
|
|
148
|
|
|
16,500
|
|
|
2,195
|
|
||
November 7, 2018
|
|
Land parcel
|
|
Spokane, WA
|
|
n/a
|
|
|
450
|
|
|
139
|
|
||
Total
|
|
|
|
|
|
910
|
|
|
$
|
107,250
|
|
|
$
|
42,649
|
|
(1)
|
The portfolio included the Country Inn & Suites and the Holiday Inn Express in Charleston, WV.
|
(2)
|
The portfolio included the SpringHill Suites in Minneapolis (Bloomington), MN, the Hampton Inn & Suites in Minneapolis (Bloomington), MN, the Residence Inn in Salt Lake City, UT, the Hyatt Place in Dallas (Arlington), TX, the Hampton Inn in Santa Barbara (Goleta), CA, and the Hampton Inn in Boston (Norwood), MA. The sale resulted in a net gain of $36.6 million based on a gross aggregate sales price of $135.0 million, or a net aggregate sales price of $133.0 million after a buyer credit of $2.0 million.
|
(3)
|
The portfolio included the Hilton Garden Inn in Birmingham (Lakeshore), AL and the Hilton Garden Inn in Birmingham (Liberty Park), AL.
|
(4)
|
The portfolio included the Hampton Inn in Provo, UT and the Holiday Inn Express & Suites in Sandy, UT.
|
(5)
|
The portfolio included the Holiday Inn in Duluth, GA and the Hilton Garden Inn in Duluth, GA. We provided seller financing of $3.6 million on the sale of these properties under two three-and-a-half-year second mortgage notes with a blended interest rate of 7.38%.
|
(6)
|
The portfolio included the Hampton Inn & Suites in Smyrna, TN, the Hilton Garden Inn in Smyrna, TN and the Hyatt Place Phoenix North in Phoenix, AZ. The proceeds from these sales were used to complete a 1031 Exchange, which resulted in the deferral of taxable gains of $22.2 million.
|
|
|
2019
|
|
2018
|
||||
Real estate loans
|
|
$
|
32,831
|
|
|
$
|
34,650
|
|
Unamortized discount
|
|
(1,895
|
)
|
|
(3,950
|
)
|
||
|
|
$
|
30,936
|
|
|
$
|
30,700
|
|
|
|
2019
|
|
2018
|
||||
Land
|
|
$
|
425
|
|
|
$
|
2,442
|
|
Hotel building and improvements
|
|
—
|
|
|
7,929
|
|
||
Furniture, fixtures and equipment
|
|
—
|
|
|
2,519
|
|
||
Franchise fees
|
|
—
|
|
|
131
|
|
||
|
|
425
|
|
|
13,021
|
|
||
Less - accumulated depreciation and amortization
|
|
—
|
|
|
(5,388
|
)
|
||
|
|
$
|
425
|
|
|
$
|
7,633
|
|
|
|
2019
|
|
2018
|
||||
FF&E reserves
|
|
$
|
25,664
|
|
|
$
|
24,386
|
|
Property taxes
|
|
1,728
|
|
|
1,625
|
|
||
Other
|
|
203
|
|
|
2,457
|
|
||
|
|
$
|
27,595
|
|
|
$
|
28,468
|
|
|
|
2019
|
|
2018
|
||||
Prepaid insurance
|
|
$
|
3,501
|
|
|
$
|
2,822
|
|
Prepaid taxes
|
|
2,032
|
|
|
3,825
|
|
||
Other
|
|
3,311
|
|
|
3,464
|
|
||
|
|
$
|
8,844
|
|
|
$
|
10,111
|
|
|
|
2019
|
|
2018
|
||||
Initial franchise fees
|
|
$
|
6,615
|
|
|
$
|
6,463
|
|
Less - accumulated amortization
|
|
(1,906
|
)
|
|
(1,772
|
)
|
||
|
|
$
|
4,709
|
|
|
$
|
4,691
|
|
|
|
2019
|
|
2018
|
||||
Purchase options related to real estate loans
|
|
$
|
8,920
|
|
|
$
|
6,120
|
|
Deferred tax asset, net
|
|
2,138
|
|
|
2,046
|
|
||
Other
|
|
981
|
|
|
—
|
|
||
Prepaid land lease
|
|
—
|
|
|
3,180
|
|
||
Derivative financial instruments
|
|
—
|
|
|
3,461
|
|
||
|
|
$
|
12,039
|
|
|
$
|
14,807
|
|
|
|
2019
|
|
2018
|
||||
Accrued property, sales and income taxes
|
|
$
|
21,392
|
|
|
$
|
19,570
|
|
Derivative financial instruments
|
|
16,177
|
|
|
5,042
|
|
||
Other accrued expenses at hotels
|
|
13,274
|
|
|
13,288
|
|
||
Accrued salaries and benefits
|
|
11,625
|
|
|
10,540
|
|
||
Other
|
|
8,209
|
|
|
9,801
|
|
||
Accrued interest
|
|
1,082
|
|
|
3,186
|
|
||
Acquired unfavorable leases
|
|
—
|
|
|
4,623
|
|
||
|
|
$
|
71,759
|
|
|
$
|
66,050
|
|
Lender
|
|
Reference
|
|
Interest
Rate
|
|
Amortization Period
(Years)
|
|
Maturity Date
|
|
Number of
Properties
Encumbered
|
|
Balance at
|
||||||
|
|
|
|
|
|
December 31,
|
||||||||||||
|
|
|
|
|
12/31/2019
|
|
2019
|
|
2018
|
|||||||||
$600 Million Senior Unsecured Credit and Term Loan Facility (1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Deutsche Bank AG New York Branch
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
$400 Million Revolver
|
|
|
|
3.41% Variable
|
|
n/a
|
|
March 31, 2023
|
|
n/a
|
|
$
|
75,000
|
|
|
$
|
115,000
|
|
$200 Million Term Loan
|
|
|
|
3.36% Variable
|
|
n/a
|
|
April 1, 2024
|
|
n/a
|
|
200,000
|
|
|
200,000
|
|
||
Total Senior Unsecured Credit and Term Loan Facility
|
|
|
|
|
|
|
|
|
|
|
|
275,000
|
|
|
315,000
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Joint Venture Credit Facility (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Bank of America, N.A.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
$125 Million Revolver
|
|
|
|
3.91% Variable
|
|
n/a
|
|
October 8, 2023
|
|
n/a
|
|
65,000
|
|
|
—
|
|
||
$75 Million Term Loan
|
|
|
|
3.86% Variable
|
|
n/a
|
|
October 8, 2023
|
|
n/a
|
|
75,000
|
|
|
—
|
|
||
Total Joint Venture Credit Facility
|
|
|
|
|
|
|
|
|
|
|
|
140,000
|
|
|
—
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Unsecured Term Loan (1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Term Loan (KeyBank National Association, as Administrative Agent)
|
|
|
|
3.36% Variable
|
|
n/a
|
|
November 25, 2022
|
|
n/a
|
|
225,000
|
|
|
225,000
|
|
||
Term Loan (KeyBank National Association, as Administrative Agent)
|
|
|
|
3.66% Variable
|
|
n/a
|
|
February 14, 2025
|
|
n/a
|
|
225,000
|
|
|
225,000
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Secured Mortgage Indebtedness
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
KeyBank National Association
|
|
(3)
|
|
4.46% Fixed
|
|
30
|
|
February 1, 2023
|
|
3
|
|
19,510
|
|
|
26,357
|
|
||
|
|
(4)
|
|
4.52% Fixed
|
|
30
|
|
April 1, 2023
|
|
3
|
|
19,992
|
|
|
20,444
|
|
||
|
|
(5)
|
|
4.30% Fixed
|
|
30
|
|
April 1, 2023
|
|
3
|
|
19,323
|
|
|
19,777
|
|
||
|
|
(6)
|
|
4.95% Fixed
|
|
30
|
|
August 1, 2023
|
|
2
|
|
34,695
|
|
|
35,411
|
|
||
MetaBank
|
|
(7)
|
|
4.44% Fixed
|
|
25
|
|
July 1, 2027
|
|
3
|
|
47,226
|
|
|
47,640
|
|
||
Bank of Cascades
|
|
(8)
|
|
3.76% Variable
|
|
25
|
|
December 19, 2024
|
|
1
|
|
8,490
|
|
|
8,757
|
|
||
|
|
(8)
|
|
4.30% Fixed
|
|
25
|
|
December 19, 2024
|
|
—
|
|
8,490
|
|
|
8,757
|
|
||
Compass Bank
|
|
(9)
|
|
n/a
|
|
25
|
|
May 6, 2020
|
|
—
|
|
—
|
|
|
22,151
|
|
||
U.S. Bank, NA
|
|
(10)
|
|
n/a
|
|
25
|
|
November 11, 2021
|
|
—
|
|
—
|
|
|
10,717
|
|
||
Total Mortgage Loans
|
|
|
|
|
|
|
|
|
|
15
|
|
157,726
|
|
|
200,011
|
|
||
Total Debt
|
|
|
|
|
|
|
|
|
|
|
|
1,022,726
|
|
|
965,011
|
|
||
Unamortized debt issuance costs
|
|
|
|
|
|
|
|
|
|
|
|
(6,563
|
)
|
|
(6,299
|
)
|
||
Debt, net of issuance costs
|
|
|
|
|
|
|
|
|
|
|
|
$
|
1,016,163
|
|
|
$
|
958,712
|
|
|
|
2019
|
|
Percentage
|
|
2018
|
|
Percentage
|
||||||
Fixed-rate debt
|
|
$
|
549,236
|
|
|
54
|
%
|
|
$
|
569,103
|
|
|
59
|
%
|
Variable-rate debt
|
|
473,490
|
|
|
46
|
%
|
|
395,908
|
|
|
41
|
%
|
||
|
|
$
|
1,022,726
|
|
|
|
|
$
|
965,011
|
|
|
|
2020
|
|
$
|
3,742
|
|
2021
|
|
3,912
|
|
|
2022
|
|
229,072
|
|
|
2023
|
|
303,434
|
|
|
2024
|
|
216,105
|
|
|
Thereafter
|
|
266,461
|
|
|
|
|
$
|
1,022,726
|
|
|
|
2019
|
|
2018
|
|
|
||||||||||||
|
|
Carrying
Value
|
|
Fair Value
|
|
Carrying
Value
|
|
Fair Value
|
|
Valuation Technique
|
||||||||
Fixed-rate debt
|
|
$
|
149,236
|
|
|
$
|
151,268
|
|
|
$
|
169,103
|
|
|
$
|
166,256
|
|
|
Level 2 - Market approach
|
2020
|
|
$
|
2,148
|
|
2021
|
|
2,038
|
|
|
2022
|
|
1,815
|
|
|
2023
|
|
959
|
|
|
2024
|
|
900
|
|
|
Thereafter
|
|
28,904
|
|
|
Total lease payments (1)
|
|
36,764
|
|
|
Less imputed interest
|
|
(17,160
|
)
|
|
Total
|
|
$
|
19,604
|
|
|
|
|
|
|
|
Average Annual Effective Fixed Rate
|
|
Notional Amount
|
|
Fair Value
|
|||||||||||||
Contract date
|
|
Effective Date
|
|
Expiration Date
|
|
|
December 31, 2019
|
|
December 31, 2018
|
|
December 31, 2019
|
|
December 31, 2018
|
||||||||||
October 2, 2017
|
|
January 29, 2018
|
|
January 31, 2023
|
|
1.98
|
%
|
|
$
|
100,000
|
|
|
$
|
100,000
|
|
|
$
|
(1,316
|
)
|
|
$
|
1,758
|
|
October 2, 2017
|
|
January 29, 2018
|
|
January 31, 2023
|
|
1.98
|
%
|
|
100,000
|
|
|
100,000
|
|
|
(1,350
|
)
|
|
1,703
|
|
||||
June 11, 2018
|
|
September 28, 2018
|
|
September 30, 2024
|
|
2.87
|
%
|
|
75,000
|
|
|
75,000
|
|
|
(4,389
|
)
|
|
(1,656
|
)
|
||||
June 11, 2018
|
|
December 31, 2018
|
|
December 31, 2025
|
|
2.93
|
%
|
|
125,000
|
|
|
125,000
|
|
|
(9,122
|
)
|
|
(3,386
|
)
|
||||
|
|
|
|
|
|
|
|
$
|
400,000
|
|
|
$
|
400,000
|
|
|
$
|
(16,177
|
)
|
|
$
|
(1,581
|
)
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
(Loss) Gain recognized in Accumulated other comprehensive loss on derivative financial instruments
|
|
$
|
(15,327
|
)
|
|
$
|
(3,050
|
)
|
|
$
|
1,703
|
|
Loss reclassified from Accumulated other comprehensive loss to interest expense
|
|
$
|
(731
|
)
|
|
$
|
(150
|
)
|
|
$
|
(734
|
)
|
Total interest expense and other finance expense presented in the Consolidated Statement of Operations in which the effects of cash flow hedges are recorded
|
|
$
|
(41,030
|
)
|
|
$
|
(41,944
|
)
|
|
$
|
(29,687
|
)
|
|
|
2019
|
|
2018
|
||
Beginning common shares outstanding
|
|
104,783,179
|
|
|
104,287,128
|
|
Grants under the Equity Plan
|
|
537,734
|
|
|
583,738
|
|
Common Unit redemptions
|
|
50,244
|
|
|
64,126
|
|
Annual grants to independent directors
|
|
40,455
|
|
|
34,130
|
|
Common stock issued for director fees
|
|
—
|
|
|
3,543
|
|
Performance share and other forfeitures
|
|
(167,757
|
)
|
|
(1,636
|
)
|
Shares retained for employee tax withholding requirements
|
|
(74,340
|
)
|
|
(187,850
|
)
|
Ending common shares outstanding
|
|
105,169,515
|
|
|
104,783,179
|
|
|
|
Fair Value Measurement at December 31, 2019 using
|
||||||||||||||
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
||||||||
Purchase options related to real estate loans
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
8,920
|
|
|
$
|
8,920
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest rate swaps
|
|
—
|
|
|
16,177
|
|
|
—
|
|
|
16,177
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
|
|
Fair Value Measurement at December 31, 2018 using
|
||||||||||||||
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps
|
|
$
|
—
|
|
|
$
|
3,461
|
|
|
$
|
—
|
|
|
$
|
3,461
|
|
Purchase options related to real estate loans
|
|
—
|
|
|
—
|
|
|
6,120
|
|
|
6,120
|
|
||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest rate swaps
|
|
—
|
|
|
5,042
|
|
|
—
|
|
|
5,042
|
|
|
|
Real Estate Loan 1
|
|
Real Estate Loan 2
|
|
Real Estate Loan 3
|
|
Real Estate Loan 4
|
|
||||||||
Exercise price
|
|
$
|
15,143
|
|
|
$
|
17,377
|
|
|
$
|
5,503
|
|
|
$
|
37,800
|
|
|
First option exercise date (1)
|
|
12/31/2018
|
|
|
3/31/2019
|
|
|
5/31/2019
|
|
|
8/15/2021
|
|
|
||||
Last option exercise date
|
|
11/1/2020
|
|
|
12/5/2020
|
|
|
12/1/2020
|
|
|
8/30/2021
|
|
|
||||
Expected volatility
|
|
32.0
|
%
|
|
38.0
|
%
|
|
37.0
|
%
|
|
31.3
|
%
|
|
||||
Risk free rate
|
|
1.7
|
%
|
|
1.8
|
%
|
|
1.9
|
%
|
|
1.5
|
%
|
|
||||
Expected annualized equity dividend yield
|
|
6.8
|
%
|
|
9.9
|
%
|
|
6.5
|
%
|
|
—
|
%
|
(2)
|
|
|
Number of Shares
|
|
Weighted Average
Grant Date Fair Value
per Share
|
|
Aggregate
Current Value
|
|||||
|
|
|
|
|
|
(in thousands)
|
|||||
Non-vested December 31, 2017
|
|
391,477
|
|
|
$
|
13.52
|
|
|
|
|
|
Granted
|
|
185,930
|
|
|
13.15
|
|
|
|
|
||
Vested
|
|
(205,619
|
)
|
|
13.41
|
|
|
|
|
||
Forfeited
|
|
(1,636
|
)
|
|
12.84
|
|
|
|
|||
Non-vested December 31, 2018
|
|
370,152
|
|
|
13.40
|
|
|
|
|
||
Granted
|
|
235,407
|
|
|
11.32
|
|
|
|
|
||
Vested
|
|
(154,801
|
)
|
|
12.82
|
|
|
|
|
||
Forfeited
|
|
(2,291
|
)
|
|
12.65
|
|
|
|
|||
Non-vested December 31, 2019
|
|
448,467
|
|
|
$
|
12.51
|
|
|
$
|
5,534
|
|
|
|
Number of Shares
|
|
Weighted Average
Grant Date Fair Value
per Share
|
|
Aggregate
Current Value
|
|||||
|
|
|
|
|
|
(in thousands)
|
|||||
Non-vested December 31, 2017
|
|
619,429
|
|
|
$
|
16.16
|
|
|
|
|
|
Granted
|
|
397,808
|
|
|
15.69
|
|
|
|
|
||
Vested
|
|
(309,010
|
)
|
|
18.78
|
|
|
|
|
||
Non-vested December 31, 2018
|
|
708,227
|
|
|
14.75
|
|
|
|
|
||
Granted
|
|
302,327
|
|
|
12.81
|
|
|
|
|
||
Vested
|
|
(89,097
|
)
|
|
13.77
|
|
|
|
|
||
Forfeited
|
|
(165,466
|
)
|
|
13.77
|
|
|
|
|
||
Non-vested December 31, 2019
|
|
755,991
|
|
|
$
|
14.31
|
|
|
$
|
9,329
|
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Expected dividend yield
|
|
6.17
|
%
|
|
5.33
|
%
|
|
4.14
|
%
|
|||
Expected stock price volatility
|
|
23.2
|
%
|
|
25.7
|
%
|
|
24.8
|
%
|
|||
Risk-free interest rate
|
|
2.43
|
%
|
|
2.41
|
%
|
|
1.59
|
%
|
|||
Monte Carlo iterations
|
|
100,000
|
|
|
100,000
|
|
|
100,000
|
|
|||
Weighted average estimated fair value of performance-based restricted stock awards
|
|
$
|
12.81
|
|
|
$
|
13.73
|
|
|
$
|
17.13
|
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Time-based restricted stock
|
|
$
|
2,327
|
|
|
$
|
2,384
|
|
|
$
|
2,145
|
|
Performance-based restricted stock
|
|
3,396
|
|
|
3,727
|
|
|
3,183
|
|
|||
Director stock
|
|
496
|
|
|
554
|
|
|
559
|
|
|||
|
|
$
|
6,219
|
|
|
$
|
6,665
|
|
|
$
|
5,887
|
|
|
|
Total
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
||||||||||
Time-based restricted stock
|
|
$
|
3,092
|
|
|
$
|
1,798
|
|
|
$
|
1,048
|
|
|
$
|
231
|
|
|
$
|
15
|
|
Performance-based restricted stock
|
|
4,270
|
|
|
2,578
|
|
|
1,477
|
|
|
215
|
|
|
—
|
|
|||||
|
|
$
|
7,362
|
|
|
$
|
4,376
|
|
|
$
|
2,525
|
|
|
$
|
446
|
|
|
$
|
15
|
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Current:
|
|
|
|
|
|
|
|
|
|
|||
Federal
|
|
$
|
869
|
|
|
$
|
(67
|
)
|
|
$
|
10
|
|
State and local
|
|
643
|
|
|
(425
|
)
|
|
777
|
|
|||
Deferred:
|
|
|
|
|
|
|
|
|
|
|||
Federal
|
|
(32
|
)
|
|
(279
|
)
|
|
232
|
|
|||
State and local
|
|
20
|
|
|
(151
|
)
|
|
49
|
|
|||
Effect of federal tax law change
|
|
—
|
|
|
—
|
|
|
606
|
|
|||
Income tax expense (benefit)
|
|
$
|
1,500
|
|
|
$
|
(922
|
)
|
|
$
|
1,674
|
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Statutory federal income tax provision
|
|
$
|
17,608
|
|
|
$
|
18,943
|
|
|
$
|
35,418
|
|
Nontaxable income of the REITs
|
|
(16,996
|
)
|
|
(19,073
|
)
|
|
(35,073
|
)
|
|||
Effect of graduated corporate tax rates
|
|
—
|
|
|
—
|
|
|
(10
|
)
|
|||
State income taxes, net of federal tax benefit
|
|
568
|
|
|
266
|
|
|
716
|
|
|||
Provision to return and deferred adjustment
|
|
(6
|
)
|
|
75
|
|
|
—
|
|
|||
Effect of permanent differences and other
|
|
326
|
|
|
(184
|
)
|
|
17
|
|
|||
Tax benefit from deduction for partnership distributions
|
|
—
|
|
|
(949
|
)
|
|
—
|
|
|||
Effect of federal tax law change
|
|
—
|
|
|
—
|
|
|
606
|
|
|||
Income tax provision (benefit)
|
|
$
|
1,500
|
|
|
$
|
(922
|
)
|
|
$
|
1,674
|
|
|
|
2019
|
|
2018
|
||||
Tax carryforwards
|
|
$
|
38
|
|
|
$
|
154
|
|
Accrued expenses
|
|
2,068
|
|
|
1,893
|
|
||
Other
|
|
32
|
|
|
(1
|
)
|
||
Net deferred tax assets
|
|
$
|
2,138
|
|
|
$
|
2,046
|
|
|
|
|
|
|
||||
Gross deferred tax assets
|
|
$
|
2,172
|
|
|
$
|
2,086
|
|
Gross deferred tax liabilities
|
|
(34
|
)
|
|
(40
|
)
|
||
Net deferred tax assets
|
|
$
|
2,138
|
|
|
$
|
2,046
|
|
|
|
2019
|
|
2018
|
|
2017
|
|||||||||||||||
|
|
Amount
|
|
%
|
|
Amount
|
|
%
|
|
Amount
|
|
%
|
|||||||||
Common Stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Ordinary income
|
|
$
|
0.6132
|
|
|
85.16
|
%
|
|
$
|
0.7200
|
|
|
100.00
|
%
|
|
$
|
0.6725
|
|
|
100.00
|
%
|
Capital gain distributions
|
|
0.1068
|
|
|
14.84
|
%
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|||
Total
|
|
$
|
0.7200
|
|
|
100.00
|
%
|
|
$
|
0.7200
|
|
|
100.00
|
%
|
|
$
|
0.6725
|
|
|
100.00
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Preferred Stock - Series B
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Ordinary income
|
|
$
|
—
|
|
|
—
|
%
|
|
$
|
—
|
|
|
—
|
%
|
|
$
|
2.0234
|
|
|
100.00
|
%
|
Capital gain distributions
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|||
Total
|
|
$
|
—
|
|
|
—
|
%
|
|
$
|
—
|
|
|
—
|
%
|
|
$
|
2.0234
|
|
|
100.00
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Preferred Stock - Series C
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Ordinary income
|
|
$
|
—
|
|
|
—
|
%
|
|
$
|
0.5393
|
|
|
100.00
|
%
|
|
$
|
1.7813
|
|
|
100.00
|
%
|
Capital gain distributions
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|||
Total
|
|
$
|
—
|
|
|
—
|
%
|
|
$
|
0.5393
|
|
|
100.00
|
%
|
|
$
|
1.7813
|
|
|
100.00
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Preferred Stock - Series D
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Ordinary income
|
|
$
|
1.3732
|
|
|
85.16
|
%
|
|
$
|
1.6125
|
|
|
100.00
|
%
|
|
$
|
1.6125
|
|
|
100.00
|
%
|
Capital gain distributions
|
|
0.2393
|
|
|
14.84
|
%
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|||
Total
|
|
$
|
1.6125
|
|
|
100.00
|
%
|
|
$
|
1.6125
|
|
|
100.00
|
%
|
|
$
|
1.6125
|
|
|
100.00
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Preferred Stock - Series E
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Ordinary Income
|
|
$
|
1.3307
|
|
|
85.16
|
%
|
|
$
|
1.5625
|
|
|
100.00
|
%
|
|
$
|
0.0694
|
|
|
100.00
|
%
|
Capital gain distributions
|
|
0.2318
|
|
|
14.84
|
%
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|||
Total
|
|
$
|
1.5625
|
|
|
100.00
|
%
|
|
$
|
1.5625
|
|
|
100.00
|
%
|
|
$
|
0.0694
|
|
|
100.00
|
%
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Numerator:
|
|
|
|
|
|
|
|
|
|
|||
Net income
|
|
$
|
82,348
|
|
|
$
|
91,126
|
|
|
$
|
99,521
|
|
Less: Preferred dividends
|
|
(14,838
|
)
|
|
(16,671
|
)
|
|
(17,408
|
)
|
|||
Premium on redemption of preferred stock
|
|
—
|
|
|
(3,277
|
)
|
|
(2,572
|
)
|
|||
Allocation to participating securities
|
|
(309
|
)
|
|
(271
|
)
|
|
(307
|
)
|
|||
Attributable to non-controlling interest in Operating Partnership
|
|
(157
|
)
|
|
(205
|
)
|
|
(307
|
)
|
|||
Attributable to non-controlling interest in joint venture
|
|
419
|
|
|
—
|
|
|
—
|
|
|||
Net income attributable to common stockholders, net of amount allocated to participating securities
|
|
$
|
67,463
|
|
|
$
|
70,702
|
|
|
$
|
78,927
|
|
Denominator:
|
|
|
|
|
|
|
|
|
|
|||
Weighted average common shares outstanding - basic
|
|
103,887
|
|
|
103,623
|
|
|
99,406
|
|
|||
Dilutive effect of equity-based compensation awards
|
|
52
|
|
|
219
|
|
|
374
|
|
|||
Weighted average common shares outstanding - diluted
|
|
103,939
|
|
|
103,842
|
|
|
99,780
|
|
|||
Earnings per share:
|
|
|
|
|
|
|
|
|
|
|||
Basic and diluted
|
|
$
|
0.65
|
|
|
$
|
0.68
|
|
|
$
|
0.79
|
|
|
|
2019
|
||||||||||||||
|
|
First
Quarter
|
|
Second
Quarter
|
|
Third
Quarter
|
|
Fourth
Quarter
|
||||||||
Total revenues
|
|
$
|
138,952
|
|
|
$
|
142,930
|
|
|
$
|
133,685
|
|
|
$
|
133,781
|
|
Net income
|
|
$
|
12,900
|
|
|
$
|
49,069
|
|
|
$
|
11,626
|
|
|
$
|
8,753
|
|
Net income attributable to Summit Hotel Properties, Inc.
|
|
$
|
12,877
|
|
|
$
|
48,957
|
|
|
$
|
11,534
|
|
|
$
|
9,242
|
|
Earnings per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic and diluted
|
|
$
|
0.09
|
|
|
$
|
0.43
|
|
|
$
|
0.07
|
|
|
$
|
0.05
|
|
|
|
2018
|
||||||||||||||
|
|
First
Quarter
|
|
Second
Quarter
|
|
Third
Quarter
|
|
Fourth
Quarter
|
||||||||
Total revenues
|
|
$
|
140,199
|
|
|
$
|
152,222
|
|
|
$
|
142,340
|
|
|
$
|
132,509
|
|
Net income
|
|
$
|
9,691
|
|
|
$
|
37,677
|
|
|
$
|
38,001
|
|
|
$
|
5,757
|
|
Net income attributable to Summit Hotel Properties, Inc.
|
|
$
|
9,688
|
|
|
$
|
37,576
|
|
|
$
|
37,901
|
|
|
$
|
5,756
|
|
Earnings per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic
|
|
$
|
0.01
|
|
|
$
|
0.33
|
|
|
$
|
0.33
|
|
|
$
|
0.02
|
|
Diluted
|
|
$
|
0.01
|
|
|
$
|
0.32
|
|
|
$
|
0.33
|
|
|
$
|
0.02
|
|
|
|
|
|
|
|
Initial Cost
|
|
Cost Capitalized Subsequent to Acquisition
|
|
Total Cost
|
|
|
|
|
|
|
||||||||||||||||||||||||||
Location
|
|
Franchise
|
|
Year Acquired/ Constructed
|
|
Land
|
|
Building & Improvements
|
|
Land, Building & Improvements
|
|
Land
|
|
Building & Improvements
|
|
Total
|
|
Accumulated Depreciation
|
|
Total Cost Net of Accumulated Depreciation
|
|
Mortgage Debt
|
|
|
||||||||||||||||||
Aliso Viejo, CA
|
|
Homewood Suites
|
|
2017
|
|
$
|
5,599
|
|
|
$
|
32,367
|
|
|
$
|
354
|
|
|
$
|
5,599
|
|
|
$
|
32,721
|
|
|
$
|
38,320
|
|
|
$
|
(4,030
|
)
|
|
$
|
34,290
|
|
|
$
|
—
|
|
|
|
Arlington, TX
|
|
Courtyard
|
|
2012
|
|
1,497
|
|
|
15,573
|
|
|
(565
|
)
|
|
1,497
|
|
|
15,008
|
|
|
16,505
|
|
|
(3,830
|
)
|
|
12,675
|
|
|
—
|
|
|
|
|||||||||
Arlington, TX
|
|
Residence Inn
|
|
2012
|
|
1,646
|
|
|
15,440
|
|
|
16
|
|
|
1,646
|
|
|
15,456
|
|
|
17,102
|
|
|
(4,071
|
)
|
|
13,031
|
|
|
—
|
|
|
|
|||||||||
Asheville, NC
|
|
Hotel Indigo
|
|
2015
|
|
2,100
|
|
|
34,755
|
|
|
1,051
|
|
|
2,100
|
|
|
35,806
|
|
|
37,906
|
|
|
(6,687
|
)
|
|
31,219
|
|
|
—
|
|
|
|
|||||||||
Atlanta, GA
|
|
Courtyard
|
|
2012
|
|
2,050
|
|
|
27,969
|
|
|
834
|
|
|
2,050
|
|
|
28,803
|
|
|
30,853
|
|
|
(5,702
|
)
|
|
25,151
|
|
|
—
|
|
|
|
|||||||||
Atlanta, GA
|
|
Residence Inn
|
|
2016
|
|
3,381
|
|
|
34,820
|
|
|
790
|
|
|
3,381
|
|
|
35,610
|
|
|
38,991
|
|
|
(4,801
|
)
|
|
34,190
|
|
|
—
|
|
|
|
|||||||||
Atlanta, GA
|
|
AC Hotel
|
|
2017
|
|
5,670
|
|
|
51,922
|
|
|
567
|
|
|
5,670
|
|
|
52,489
|
|
|
58,159
|
|
|
(5,378
|
)
|
|
52,781
|
|
|
—
|
|
|
|
|||||||||
Austin, TX
|
|
Hampton Inn & Suites
|
|
2014
|
|
—
|
|
(2)
|
56,394
|
|
|
4,846
|
|
|
—
|
|
|
61,240
|
|
|
61,240
|
|
|
(9,519
|
)
|
|
51,721
|
|
|
—
|
|
|
|
|||||||||
Austin, TX
|
|
Corporate Office
|
|
2017
|
|
—
|
|
|
6,048
|
|
|
1,410
|
|
|
—
|
|
|
7,458
|
|
|
7,458
|
|
|
(2,207
|
)
|
|
5,251
|
|
|
—
|
|
|
|
|||||||||
Baltimore, MD
|
|
Hampton Inn & Suites
|
|
2017
|
|
2,205
|
|
|
16,013
|
|
|
2,342
|
|
|
2,205
|
|
|
18,355
|
|
|
20,560
|
|
|
(1,373
|
)
|
|
19,187
|
|
|
—
|
|
|
|
|||||||||
Baltimore, MD
|
|
Residence Inn
|
|
2017
|
|
1,986
|
|
|
37,016
|
|
|
6,198
|
|
|
1,986
|
|
|
43,214
|
|
|
45,200
|
|
|
(4,372
|
)
|
|
40,828
|
|
|
—
|
|
|
|
|||||||||
Boulder, CO
|
|
Marriott
|
|
2016
|
|
11,115
|
|
|
49,204
|
|
|
8,946
|
|
|
11,115
|
|
|
58,150
|
|
|
69,265
|
|
|
(7,000
|
)
|
|
62,265
|
|
|
—
|
|
|
|
|||||||||
Branchburg, NJ
|
|
Residence Inn
|
|
2015
|
|
2,374
|
|
|
24,411
|
|
|
285
|
|
|
2,374
|
|
|
24,696
|
|
|
27,070
|
|
|
(4,754
|
)
|
|
22,316
|
|
|
—
|
|
|
|
|||||||||
Brisbane, CA
|
|
DoubleTree
|
|
2014
|
|
3,300
|
|
|
39,686
|
|
|
1,137
|
|
|
3,300
|
|
|
40,823
|
|
|
44,123
|
|
|
(11,496
|
)
|
|
32,627
|
|
|
—
|
|
|
|
|||||||||
Camarillo, CA
|
|
Hampton Inn & Suites
|
|
2013
|
|
2,200
|
|
|
17,366
|
|
|
384
|
|
|
2,200
|
|
|
17,750
|
|
|
19,950
|
|
|
(5,749
|
)
|
|
14,201
|
|
|
—
|
|
|
|
|||||||||
Charlotte, NC
|
|
Courtyard
|
|
2017
|
|
—
|
|
|
41,094
|
|
|
1,468
|
|
|
—
|
|
|
42,562
|
|
|
42,562
|
|
|
(4,581
|
)
|
|
37,981
|
|
|
—
|
|
|
|
|||||||||
Chicago, IL
|
|
Hyatt Place
|
|
2016
|
|
5,395
|
|
|
68,355
|
|
|
192
|
|
|
5,395
|
|
|
68,547
|
|
|
73,942
|
|
|
(9,533
|
)
|
|
64,409
|
|
|
—
|
|
|
|
|||||||||
Cleveland, OH
|
|
Residence Inn
|
|
2017
|
|
10,075
|
|
|
33,340
|
|
|
1,699
|
|
|
10,075
|
|
|
35,039
|
|
|
45,114
|
|
|
(3,925
|
)
|
|
41,189
|
|
|
—
|
|
|
|
|||||||||
Decatur, GA
|
|
Courtyard
|
|
2015
|
|
4,046
|
|
|
34,151
|
|
|
3,816
|
|
|
4,046
|
|
|
37,967
|
|
|
42,013
|
|
|
(5,818
|
)
|
|
36,195
|
|
|
—
|
|
|
|
|||||||||
Eden Prairie, MN
|
|
Hilton Garden Inn
|
|
2013
|
|
1,800
|
|
|
11,211
|
|
|
146
|
|
|
1,800
|
|
|
11,357
|
|
|
13,157
|
|
|
(3,981
|
)
|
|
9,176
|
|
|
—
|
|
|
|
|||||||||
Englewood, CO
|
|
Hyatt Place
|
|
2012
|
|
2,000
|
|
|
11,950
|
|
|
(441
|
)
|
|
2,000
|
|
|
11,509
|
|
|
13,509
|
|
|
(4,054
|
)
|
|
9,455
|
|
|
19,510
|
|
|
(1)
|
|||||||||
Englewood, CO
|
|
Hyatt House
|
|
2012
|
|
2,700
|
|
|
16,267
|
|
|
224
|
|
|
2,700
|
|
|
16,491
|
|
|
19,191
|
|
|
(6,553
|
)
|
|
12,638
|
|
|
19,992
|
|
|
(1)
|
|||||||||
Fort Lauderdale, FL
|
|
Courtyard
|
|
2017
|
|
37,950
|
|
|
47,002
|
|
|
1,421
|
|
|
37,950
|
|
|
48,423
|
|
|
86,373
|
|
|
(5,861
|
)
|
|
80,512
|
|
|
—
|
|
|
|
|||||||||
Fort Worth, TX
|
|
Courtyard
|
|
2017
|
|
1,920
|
|
|
38,070
|
|
|
9,029
|
|
|
1,920
|
|
|
47,099
|
|
|
49,019
|
|
|
(3,748
|
)
|
|
45,271
|
|
|
—
|
|
|
|
|||||||||
Garden City, NY
|
|
Hyatt Place
|
|
2012
|
|
4,200
|
|
|
27,775
|
|
|
272
|
|
|
4,283
|
|
|
27,964
|
|
|
32,247
|
|
|
(5,787
|
)
|
|
26,460
|
|
|
—
|
|
|
|
|||||||||
Glendale, CO
|
|
Staybridge Suites
|
|
2011
|
|
2,100
|
|
|
10,151
|
|
|
333
|
|
|
2,100
|
|
|
10,484
|
|
|
12,584
|
|
|
(3,679
|
)
|
|
8,905
|
|
|
—
|
|
|
|
|||||||||
Greenville, SC
|
|
Hilton Garden Inn
|
|
2013
|
|
1,200
|
|
|
14,566
|
|
|
3,009
|
|
|
1,200
|
|
|
17,575
|
|
|
18,775
|
|
|
(3,772
|
)
|
|
15,003
|
|
|
—
|
|
|
|
|||||||||
Hillsboro, OR
|
|
Residence Inn
|
|
2019
|
|
4,943
|
|
|
42,541
|
|
|
9
|
|
|
4,943
|
|
|
42,550
|
|
|
47,493
|
|
|
(461
|
)
|
|
47,032
|
|
|
—
|
|
|
|
|||||||||
Hoffman Estates, IL
|
|
Hyatt Place
|
|
2013
|
|
1,900
|
|
|
8,917
|
|
|
(1,861
|
)
|
|
1,900
|
|
|
7,056
|
|
|
8,956
|
|
|
(3,186
|
)
|
|
5,770
|
|
|
19,323
|
|
|
(1)
|
|
|
|
|
|
|
Initial Cost
|
|
Cost Capitalized Subsequent to Acquisition
|
|
Total Cost
|
|
|
|
|
|
|
||||||||||||||||||||||||||
Location
|
|
Franchise
|
|
Year Acquired/ Constructed
|
|
Land
|
|
Building & Improvements
|
|
Land, Building & Improvements
|
|
Land
|
|
Building & Improvements
|
|
Total
|
|
Accumulated Depreciation
|
|
Total Cost Net of Accumulated Depreciation
|
|
Mortgage Debt
|
|
|
||||||||||||||||||
Houston, TX
|
|
Hilton Garden Inn
|
|
2014
|
|
$
|
—
|
|
(2)
|
$
|
41,838
|
|
|
$
|
5,951
|
|
|
$
|
—
|
|
|
$
|
47,789
|
|
|
$
|
47,789
|
|
|
$
|
(11,015
|
)
|
|
$
|
36,774
|
|
|
$
|
—
|
|
|
|
Houston, TX
|
|
Hilton Garden Inn
|
|
2014
|
|
2,800
|
|
|
33,777
|
|
|
1,373
|
|
|
2,800
|
|
|
35,150
|
|
|
37,950
|
|
|
(5,950
|
)
|
|
32,000
|
|
|
—
|
|
|
|
|||||||||
Hunt Valley, MD
|
|
Residence Inn
|
|
2015
|
|
—
|
|
|
35,436
|
|
|
1,326
|
|
|
1,076
|
|
|
35,686
|
|
|
36,762
|
|
|
(6,432
|
)
|
|
30,330
|
|
|
—
|
|
|
|
|||||||||
Indianapolis, IN
|
|
SpringHill Suites
|
|
2013
|
|
4,012
|
|
|
27,910
|
|
|
(646
|
)
|
|
4,012
|
|
|
27,264
|
|
|
31,276
|
|
|
(5,588
|
)
|
|
25,688
|
|
|
—
|
|
|
|
|||||||||
Indianapolis, IN
|
|
Courtyard
|
|
2013
|
|
7,788
|
|
|
54,384
|
|
|
(2,077
|
)
|
|
7,788
|
|
|
52,307
|
|
|
60,095
|
|
|
(10,470
|
)
|
|
49,625
|
|
|
—
|
|
|
|
|||||||||
Kansas City, MO
|
|
Courtyard
|
|
2017
|
|
3,955
|
|
|
20,608
|
|
|
1,769
|
|
|
3,955
|
|
|
22,377
|
|
|
26,332
|
|
|
(2,702
|
)
|
|
23,630
|
|
|
—
|
|
|
|
|||||||||
Lombard, IL
|
|
Hyatt Place
|
|
2012
|
|
1,550
|
|
|
17,351
|
|
|
(445
|
)
|
|
1,550
|
|
|
16,906
|
|
|
18,456
|
|
|
(5,597
|
)
|
|
12,859
|
|
|
—
|
|
|
(1)
|
|||||||||
Lone Tree, CO
|
|
Hyatt Place
|
|
2012
|
|
1,300
|
|
|
11,704
|
|
|
(203
|
)
|
|
1,314
|
|
|
11,487
|
|
|
12,801
|
|
|
(4,302
|
)
|
|
8,499
|
|
|
—
|
|
|
(1)
|
|||||||||
Louisville, KY
|
|
Fairfield Inn & Suites
|
|
2013
|
|
3,120
|
|
|
24,231
|
|
|
(531
|
)
|
|
3,120
|
|
|
23,700
|
|
|
26,820
|
|
|
(5,901
|
)
|
|
20,919
|
|
|
34,695
|
|
|
(1)
|
|||||||||
Louisville, KY
|
|
SpringHill Suites
|
|
2013
|
|
4,880
|
|
|
37,361
|
|
|
(719
|
)
|
|
4,880
|
|
|
36,642
|
|
|
41,522
|
|
|
(9,181
|
)
|
|
32,341
|
|
|
—
|
|
|
(1)
|
|||||||||
Mesa, AZ
|
|
Hyatt Place
|
|
2017
|
|
2,400
|
|
|
19,848
|
|
|
820
|
|
|
2,400
|
|
|
20,668
|
|
|
23,068
|
|
|
(3,648
|
)
|
|
19,420
|
|
|
47,226
|
|
|
(1)
|
|||||||||
Metairie, LA
|
|
Courtyard
|
|
2013
|
|
1,860
|
|
|
25,168
|
|
|
349
|
|
|
1,860
|
|
|
25,517
|
|
|
27,377
|
|
|
(7,505
|
)
|
|
19,872
|
|
|
—
|
|
|
|
|||||||||
Metairie, LA
|
|
Residence Inn
|
|
2013
|
|
1,791
|
|
|
23,386
|
|
|
338
|
|
|
1,791
|
|
|
23,724
|
|
|
25,515
|
|
|
(7,901
|
)
|
|
17,614
|
|
|
—
|
|
|
|
|||||||||
Miami, FL
|
|
Hyatt House
|
|
2015
|
|
4,926
|
|
|
40,087
|
|
|
1,385
|
|
|
4,926
|
|
|
41,472
|
|
|
46,398
|
|
|
(8,386
|
)
|
|
38,012
|
|
|
—
|
|
|
|
|||||||||
Milpitas, CA
|
|
Hilton Garden Inn
|
|
2019
|
|
7,921
|
|
|
46,141
|
|
|
4
|
|
|
7,921
|
|
|
46,145
|
|
|
54,066
|
|
|
(588
|
)
|
|
53,478
|
|
|
—
|
|
|
|
|||||||||
Minneapolis, MN
|
|
Hyatt Place
|
|
2013
|
|
—
|
|
|
34,026
|
|
|
1,424
|
|
|
—
|
|
|
35,450
|
|
|
35,450
|
|
|
(7,901
|
)
|
|
27,549
|
|
|
—
|
|
|
|
|||||||||
Minneapolis, MN
|
|
Hampton Inn & Suites
|
|
2015
|
|
3,502
|
|
|
35,433
|
|
|
165
|
|
|
3,502
|
|
|
35,598
|
|
|
39,100
|
|
|
(7,669
|
)
|
|
31,431
|
|
|
—
|
|
|
(1)
|
|||||||||
Minnetonka, MN
|
|
Holiday Inn Express & Suites
|
|
2013
|
|
1,000
|
|
|
7,662
|
|
|
212
|
|
|
1,000
|
|
|
7,874
|
|
|
8,874
|
|
|
(2,723
|
)
|
|
6,151
|
|
|
—
|
|
|
|
|||||||||
Nashville, TN
|
|
SpringHill Suites
|
|
2004
|
|
777
|
|
|
5,598
|
|
|
299
|
|
|
777
|
|
|
5,897
|
|
|
6,674
|
|
|
(3,473
|
)
|
|
3,201
|
|
|
—
|
|
|
|
|||||||||
Nashville, TN
|
|
Courtyard
|
|
2016
|
|
8,792
|
|
|
62,759
|
|
|
7,852
|
|
|
8,792
|
|
|
70,611
|
|
|
79,403
|
|
|
(8,259
|
)
|
|
71,144
|
|
|
—
|
|
|
|
|||||||||
New Haven, CT
|
|
Courtyard
|
|
2017
|
|
11,990
|
|
|
51,497
|
|
|
1,555
|
|
|
11,990
|
|
|
53,052
|
|
|
65,042
|
|
|
(4,489
|
)
|
|
60,553
|
|
|
—
|
|
|
|
|||||||||
New Orleans, LA
|
|
Courtyard
|
|
2013
|
|
1,944
|
|
|
25,120
|
|
|
3,356
|
|
|
1,944
|
|
|
28,476
|
|
|
30,420
|
|
|
(9,012
|
)
|
|
21,408
|
|
|
—
|
|
|
|
|||||||||
New Orleans, LA
|
|
Courtyard
|
|
2013
|
|
2,490
|
|
|
34,220
|
|
|
1,136
|
|
|
2,490
|
|
|
35,356
|
|
|
37,846
|
|
|
(10,592
|
)
|
|
27,254
|
|
|
—
|
|
|
|
|||||||||
New Orleans, LA
|
|
SpringHill Suites
|
|
2013
|
|
2,046
|
|
|
33,270
|
|
|
6,099
|
|
|
2,046
|
|
|
39,369
|
|
|
41,415
|
|
|
(10,459
|
)
|
|
30,956
|
|
|
—
|
|
|
|
|||||||||
Orlando, FL
|
|
Hyatt Place
|
|
2013
|
|
3,100
|
|
|
11,343
|
|
|
(539
|
)
|
|
3,100
|
|
|
10,804
|
|
|
13,904
|
|
|
(3,861
|
)
|
|
10,043
|
|
|
—
|
|
|
(1)
|
|||||||||
Orlando, FL
|
|
Hyatt Place
|
|
2013
|
|
2,716
|
|
|
11,221
|
|
|
422
|
|
|
2,716
|
|
|
11,643
|
|
|
14,359
|
|
|
(3,928
|
)
|
|
10,431
|
|
|
—
|
|
|
(1)
|
|||||||||
Orlando, FL
|
|
Hyatt House
|
|
2018
|
|
2,800
|
|
|
34,423
|
|
|
94
|
|
|
2,800
|
|
|
34,517
|
|
|
37,317
|
|
|
(3,394
|
)
|
|
33,923
|
|
|
—
|
|
|
|
|||||||||
Owings Mills, MD
|
|
Hyatt Place
|
|
2012
|
|
2,100
|
|
|
9,799
|
|
|
(175
|
)
|
|
2,100
|
|
|
9,624
|
|
|
11,724
|
|
|
(3,337
|
)
|
|
8,387
|
|
|
—
|
|
|
(1)
|
|||||||||
Pittsburgh, PA
|
|
Courtyard
|
|
2017
|
|
1,652
|
|
|
40,749
|
|
|
5,683
|
|
|
1,652
|
|
|
46,432
|
|
|
48,084
|
|
|
(3,871
|
)
|
|
44,213
|
|
|
—
|
|
|
|
|||||||||
Portland, OR
|
|
Hyatt Place
|
|
2009
|
|
—
|
|
(2)
|
14,700
|
|
|
457
|
|
|
—
|
|
|
15,157
|
|
|
15,157
|
|
|
(4,534
|
)
|
|
10,623
|
|
|
—
|
|
|
|
|||||||||
Portland, OR
|
|
Residence Inn
|
|
2009
|
|
—
|
|
(2)
|
15,629
|
|
|
286
|
|
|
—
|
|
|
15,915
|
|
|
15,915
|
|
|
(5,571
|
)
|
|
10,344
|
|
|
16,980
|
|
|
(1)
|
|||||||||
Portland, OR
|
|
Residence Inn
|
|
2019
|
|
12,813
|
|
|
76,868
|
|
|
38
|
|
|
12,813
|
|
|
76,906
|
|
|
89,719
|
|
|
(1,204
|
)
|
|
88,515
|
|
|
—
|
|
|
|
|||||||||
Poway, CA
|
|
Hampton Inn & Suites
|
|
2013
|
|
2,300
|
|
|
14,728
|
|
|
1,228
|
|
|
2,300
|
|
|
15,956
|
|
|
18,256
|
|
|
(3,923
|
)
|
|
14,333
|
|
|
—
|
|
|
|
|||||||||
San Francisco, CA
|
|
Hilton Garden Inn
|
|
2019
|
|
12,346
|
|
|
45,730
|
|
|
36
|
|
|
12,346
|
|
|
45,766
|
|
|
58,112
|
|
|
(585
|
)
|
|
57,527
|
|
|
—
|
|
|
|
|||||||||
San Francisco, CA
|
|
Holiday Inn Express & Suites
|
|
2013
|
|
15,545
|
|
|
49,469
|
|
|
3,875
|
|
|
15,545
|
|
|
53,344
|
|
|
68,889
|
|
|
(13,191
|
)
|
|
55,698
|
|
|
—
|
|
|
|
|||||||||
San Francisco, CA
|
|
Four Points
|
|
2014
|
|
1,200
|
|
|
21,397
|
|
|
2,874
|
|
|
1,200
|
|
|
24,271
|
|
|
25,471
|
|
|
(5,094
|
)
|
|
20,377
|
|
|
—
|
|
|
(1)
|
|
|
|
|
|
|
Initial Cost
|
|
Cost Capitalized Subsequent to Acquisition
|
|
Total Cost
|
|
|
|
|
|
|
||||||||||||||||||||||||||
Location
|
|
Franchise
|
|
Year Acquired/ Constructed
|
|
Land
|
|
Building & Improvements
|
|
Land, Building & Improvements
|
|
Land
|
|
Building & Improvements
|
|
Total
|
|
Accumulated Depreciation
|
|
Total Cost Net of Accumulated Depreciation
|
|
Mortgage Debt
|
|
|
||||||||||||||||||
Scottsdale, AZ
|
|
Hyatt Place
|
|
2012
|
|
$
|
1,500
|
|
|
$
|
10,171
|
|
|
$
|
(431
|
)
|
|
$
|
1,500
|
|
|
$
|
9,740
|
|
|
$
|
11,240
|
|
|
$
|
(3,120
|
)
|
|
$
|
8,120
|
|
|
$
|
—
|
|
|
(1)
|
Scottsdale, AZ
|
|
Courtyard
|
|
2003
|
|
3,225
|
|
|
12,571
|
|
|
3,648
|
|
|
3,225
|
|
|
16,219
|
|
|
19,444
|
|
|
(5,694
|
)
|
|
13,750
|
|
|
—
|
|
|
|
|||||||||
Scottsdale, AZ
|
|
SpringHill Suites
|
|
2003
|
|
2,195
|
|
|
9,496
|
|
|
1,750
|
|
|
2,195
|
|
|
11,246
|
|
|
13,441
|
|
|
(4,109
|
)
|
|
9,332
|
|
|
—
|
|
|
|
|||||||||
Silverthorne, CO
|
|
Hampton Inn & Suites
|
|
2019
|
|
6,845
|
|
|
21,125
|
|
|
145
|
|
|
6,845
|
|
|
21,270
|
|
|
28,115
|
|
|
(334
|
)
|
|
27,781
|
|
|
—
|
|
|
|
|||||||||
Tampa, FL
|
|
Hampton Inn & Suites
|
|
2012
|
|
3,600
|
|
|
20,366
|
|
|
4,466
|
|
|
3,600
|
|
|
24,832
|
|
|
28,432
|
|
|
(4,641
|
)
|
|
23,791
|
|
|
—
|
|
|
|
|||||||||
Tucson, AZ
|
|
Homewood Suites
|
|
2017
|
|
2,570
|
|
|
22,802
|
|
|
996
|
|
|
2,570
|
|
|
23,798
|
|
|
26,368
|
|
|
(2,981
|
)
|
|
23,387
|
|
|
—
|
|
|
|
|||||||||
Waltham, MA
|
|
Hilton Garden Inn
|
|
2017
|
|
10,644
|
|
|
21,713
|
|
|
5,888
|
|
|
10,644
|
|
|
27,601
|
|
|
38,245
|
|
|
(2,212
|
)
|
|
36,033
|
|
|
—
|
|
|
|
|||||||||
Watertown, MA
|
|
Residence Inn
|
|
2018
|
|
25,083
|
|
|
45,917
|
|
|
223
|
|
|
25,083
|
|
|
46,140
|
|
|
71,223
|
|
|
(2,528
|
)
|
|
68,695
|
|
|
—
|
|
|
|
|||||||||
Land Parcels
|
|
Land Parcels
|
|
|
|
4,645
|
|
|
—
|
|
|
(2,720
|
)
|
|
1,925
|
|
|
—
|
|
|
1,925
|
|
|
—
|
|
|
1,925
|
|
|
—
|
|
|
|
|||||||||
|
|
|
|
|
|
$
|
323,075
|
|
|
$
|
2,123,406
|
|
|
$
|
106,947
|
|
|
$
|
321,528
|
|
|
$
|
2,231,900
|
|
|
$
|
2,553,428
|
|
|
$
|
(383,763
|
)
|
|
$
|
2,169,665
|
|
|
$
|
157,726
|
|
|
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Reconciliation of land, buildings and improvements:
|
|
|
|
|
|
|
||||||
Balance at beginning of period
|
|
$
|
2,406,269
|
|
|
$
|
2,355,723
|
|
|
$
|
1,848,673
|
|
Additions to land, buildings and improvements
|
|
336,480
|
|
|
151,829
|
|
|
636,389
|
|
|||
Disposition of land, buildings and improvements
|
|
(186,800
|
)
|
|
(100,208
|
)
|
|
(129,339
|
)
|
|||
Impairment loss
|
|
(2,521
|
)
|
|
(1,075
|
)
|
|
—
|
|
|||
Balance at end of period
|
|
$
|
2,553,428
|
|
|
$
|
2,406,269
|
|
|
$
|
2,355,723
|
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
Reconciliation of accumulated depreciation:
|
|
|
|
|
|
|
||||||
Balance at beginning of period
|
|
$
|
351,821
|
|
|
$
|
290,066
|
|
|
$
|
241,760
|
|
Depreciation
|
|
99,013
|
|
|
100,545
|
|
|
85,524
|
|
|||
Depreciation on assets sold or disposed
|
|
(67,071
|
)
|
|
(38,790
|
)
|
|
(37,218
|
)
|
|||
Balance at end of period
|
|
$
|
383,763
|
|
|
$
|
351,821
|
|
|
$
|
290,066
|
|
(i)
|
common stock, $0.01 par value per share, or common stock, of which there were 105,169,515 outstanding, listed on the New York Stock Exchange, or the NYSE, under the trading symbol “INN”;
|
(ii)
|
6.45% Series D Cumulative Redeemable Preferred Stock, $0.01 par value per share, or the Series D Preferred Stock, of which there were 3,000,000 outstanding, having an aggregate liquidation preference of $75,000,000, listed on the NYSE under the trading symbol “INN-PD”;
|
(iii)
|
6.25% Series E Cumulative Redeemable Preferred Stock, $0.01 par value per share, or the Series E Preferred Stock, of which there were 6,400,000 outstanding, having an aggregate liquidation preference of $160,000,000, listed on the NYSE under the trading symbol “INN-PE”;
|
•
|
senior to our common stock and Junior Stock;
|
•
|
on a parity with our Parity Stock; and
|
•
|
junior to any class or series of our capital stock expressly designated as ranking senior to the Series D Preferred Stock as to distribution rights and rights upon our liquidation, dissolution or winding up.
|
•
|
the acquisition by any person, including any syndicate or group deemed to be a “person” under Section 13(d)(3) of the Securities Exchange Act of 1934, as amended, or the Exchange Act, of beneficial ownership, directly or indirectly, through a purchase, merger or other acquisition transaction or series of purchases, mergers or other acquisition transactions of shares of our capital stock entitling that person to exercise more than 50% of the total voting power of all shares of our capital stock entitled to vote generally in elections of directors (except that such person will be deemed to have beneficial ownership of all securities that such person has the right to acquire, whether such right is currently exercisable or is exercisable only upon the occurrence of a subsequent condition); and
|
•
|
following the closing of any transaction referred to in the bullet point above, neither we nor the acquiring or surviving entity has a class of common securities (or American Depositary Receipts representing such common securities) listed on the NYSE, the NYSE MKT or NASDAQ, or listed or quoted on an exchange or quotation system that is a successor to the NYSE, the NYSE MKT or NASDAQ.
|
•
|
the quotient obtained by dividing (i) the sum of the $25.00 liquidation preference plus the amount of any accrued and unpaid dividends to, but not including, the Change of Control Conversion Date (unless the Change of Control Conversion Date is after a record date for a Series D Preferred Stock dividend payment and prior to the corresponding Series D Preferred Stock dividend payment date, in which case no additional amount for such accrued and unpaid dividend will be included in this sum) by (ii) the Common Stock Price; and
|
•
|
3.9216 (i.e., the Share Cap), subject to certain adjustments;
|
•
|
senior to our common stock and Junior Stock;
|
•
|
on a parity with our Parity Stock; and
|
•
|
junior to any class or series of our capital stock expressly designated as ranking senior to the Series E Preferred Stock as to distribution rights and rights upon our liquidation, dissolution or winding up.
|
•
|
the acquisition by any person, including any syndicate or group deemed to be a “person” under Section 13(d)(3) of the Securities Exchange Act of 1934, as amended, or the Exchange Act, of beneficial ownership, directly or indirectly, through a purchase, merger or other acquisition transaction or series of purchases, mergers or other acquisition transactions of shares of our capital stock entitling that person to exercise more
|
•
|
following the closing of any transaction referred to in the bullet point above, neither we nor the acquiring or surviving entity has a class of common securities (or ADRs representing such common securities) listed on the NYSE, the NYSE American or Nasdaq, or listed or quoted on an exchange or quotation system that is a successor to the NYSE, the NYSE American or Nasdaq.
|
•
|
the quotient obtained by dividing (i) the sum of the $25.00 liquidation preference plus the amount of any accrued and unpaid dividends to, but not including, the Change of Control Conversion Date (unless the Change of Control Conversion Date is after a record date for a Series E Preferred Stock dividend payment and prior to the corresponding Series E Preferred Stock dividend payment date, in which case no additional amount for such accrued and unpaid dividend will be included in this sum) by (ii) the Common Stock Price; and
|
•
|
3.1686 (i.e., the Share Cap), subject to certain adjustments;
|
ENTITY
|
|
STATE OF INCORPORATION OR ORGANIZATION
|
Summit Hotel GP, LLC
|
Delaware
|
|
Summit Hotel OP, LP
|
Delaware
|
|
Summit Hotel TRS, Inc
|
Delaware
|
|
Summit Arlington CTY License, LLC
|
Delaware
|
|
Summit Licensing 121, LLC
|
Delaware
|
|
Summit Licensing 137, LLC
|
Delaware
|
|
Summit Licensing Ft Worth CTY Holding, LLC
|
Delaware
|
|
Summit Licensing Ft Worth CTY, LLC
|
Delaware
|
|
Summit Meta 2017, LLC
|
Delaware
|
|
Summit Hospitality I, LLC
|
Delaware
|
|
Summit Hospitality V, LLC
|
South Dakota
|
|
Summit Hospitality XIII, LLC
|
Delaware
|
|
Summit Hospitality XIV, LLC
|
Delaware
|
|
Summit Hospitality XV, LLC
|
Delaware
|
|
Summit Group of Scottsdale, Arizona LLC
|
South Dakota
|
|
Summit IHG JV, LLC
|
Delaware
|
|
San Fran JV, LLC
|
Delaware
|
|
Carnegie Hotels, LLC
|
Georgia
|
|
Summit Hospitality 17, LLC
|
Delaware
|
|
Summit Hospitality 18, LLC
|
Delaware
|
|
Summit Hospitality 19,LLC
|
Delaware
|
|
Summit Hospitality 20, LLC
|
Delaware
|
|
Summit Hospitality 21, LLC
|
Delaware
|
|
Summit Hospitality 22, LLC
|
Delaware
|
|
Summit Hospitality 23, LLC
|
Delaware
|
|
Summit Hospitality 24, LLC
|
Delaware
|
|
Summit Hospitality 25, LLC
|
Delaware
|
|
Summit Hospitality 036, LLC
|
Delaware
|
|
Summit Hospitality 057, LLC
|
Delaware
|
|
Summit Hospitality 060, LLC
|
Delaware
|
|
Summit Hospitality 066, LLC
|
Delaware
|
|
Summit Hospitality 084, LLC
|
Delaware
|
|
Summit Hospitality 085, LLC
|
Delaware
|
|
Summit Hospitality 099, LLC
|
Delaware
|
|
Summit Hospitality 100, LLC
|
Delaware
|
|
Summit Hospitality 102, LLC
|
Delaware
|
|
Summit Hospitality 104, LLC
|
Delaware
|
|
Summit Hospitality 110, LLC
|
Delaware
|
Summit Hospitality 111, LLC
|
Delaware
|
|
Summit Hospitality 114, LLC
|
Delaware
|
|
Summit Hospitality 115, LLC
|
Delaware
|
|
Summit Hospitality 116, LLC
|
Delaware
|
|
Summit Hospitality 117, LLC
|
Delaware
|
|
Summit Hospitality 118, LLC
|
Delaware
|
|
Summit Hospitality 119, LLC
|
Delaware
|
|
Summit Hospitality 120, LLC
|
Delaware
|
|
Summit Hospitality 121, LLC
|
Delaware
|
|
Summit Hospitality 123, LLC
|
Delaware
|
|
Summit Hospitality 126, LLC
|
Delaware
|
|
Summit Hospitality 127, LLC
|
Delaware
|
|
Summit Hospitality 128, LLC
|
Delaware
|
|
Summit Hospitality 129, LLC
|
Delaware
|
|
Summit Hospitality 130, LLC
|
Delaware
|
|
Summit Hospitality 131, LLC
|
Delaware
|
|
Summit Hospitality 132, LLC
|
Delaware
|
|
Summit Hospitality 133, LLC
|
Delaware
|
|
Summit Hospitality 134, LLC
|
Delaware
|
|
Summit Hospitality 135, LLC
|
Delaware
|
|
Summit Hospitality 136, LLC
|
Delaware
|
|
Summit Hospitality 137, LLC
|
Delaware
|
|
Summit Hospitality 138, LLC
|
Delaware
|
|
Summit Hospitality 139, LLC
|
Delaware
|
|
Summit Hospitality 140, LLC
|
Delaware
|
|
Summit Hospitality 141, LLC
|
Delaware
|
|
Summit Hospitality 142, LLC
|
Delaware
|
|
Summit Hospitality 143, LLC
|
Delaware
|
|
Summit Hospitality 144, LLC
|
Delaware
|
|
Summit Hospitality 145, LLC
|
Delaware
|
|
BP Watertown Hotel, LLC
|
Massachusetts
|
|
Summit AM, LLC
|
|
Delaware
|
Summit Hotel GP 2, LLC
|
|
Delaware
|
Summit Hospitality JV, LP
|
|
Delaware
|
(1)
|
Registration Statement (Form S-3 No. 333-231156) of Summit Hotel Properties, Inc.,
|
(2)
|
Registration Statement (Form S-3 No. 333-223989) of Summit Hotel Properties, Inc.,
|
(3)
|
Registration Statement (Form S-3 No. 333-223988) of Summit Hotel Properties, Inc.,
|
(4)
|
Registration Statement (Form S-8 No. 333-206050) pertaining to the 2011 Equity Incentive Plan of Summit Hotel Properties, Inc.,
|
(5)
|
Registration Statement (Form S-8 No. 333-172145) pertaining to the 2011 Equity Incentive Plan of Summit Hotel Properties, Inc.,
|
1.
|
I have reviewed this Annual Report on Form 10-K of Summit Hotel Properties, Inc.;
|
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 the financial statement 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 the 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: February 25, 2020
|
|
/s/ Daniel P. Hansen
|
|
|
Daniel P. Hansen
|
|
|
Chairman of the Board of Directors
President and Chief Executive Officer
|
|
|
(principal executive officer)
|
1.
|
I have reviewed this Annual Report on Form 10-K of Summit Hotel Properties, Inc.;
|
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 the financial statement 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 the 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: February 25, 2020
|
|
/s/ Jonathan P. Stanner
|
|
|
Jonathan P. Stanner
Executive Vice President, Chief Financial Officer and
Treasurer
(principal financial officer)
|
|
|
|
|
|
|
Date: February 25, 2020
|
|
/s/ Daniel P. Hansen
|
|
|
Daniel P. Hansen
|
|
|
Chairman of the Board of Directors
President and Chief Executive Officer
|
|
|
(principal executive officer)
|
|
|
|
|
|
|
Date: February 25, 2020
|
|
/s/ Jonathan P. Stanner
|
|
|
Jonathan P. Stanner
|
|
|
Executive Vice President, Chief Financial Officer and Treasurer
|
|
|
(principal financial officer)
|