Document
false0001511337 0001511337 2019-08-07 2019-08-07


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549
 
FORM 8-K
 
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
 
Date of Report (Date of earliest event reported): August 7, 2019
 
RLJ LODGING TRUST
(Exact name of registrant as specified in its charter)
 
Maryland
 
001-35169
 
27-4706509
(State or other jurisdiction of incorporation)
 
(Commission File Number)
 
(IRS Employer Identification Number)
 
3 Bethesda Metro Center Suite 1000
 
 
Bethesda,
Maryland
 
20814
(Address of principal executive offices)
 
(Zip Code)
 
(301280-7777
(Registrant’s telephone number, including area code)
 
Not applicable
(Former name or former address, if changed since last report)
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
 
      Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
      Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
      Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
      Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))


Securities registered pursuant to Section 12 (b) of the Exchange Act:
Title of Class
 
Trading Symbol
 
Name of Exchange on Which Registered
 
 
 
 
 
Common Shares of beneficial interest, par value $0.01 per share
 
RLJ
 
New York Stock Exchange
 
 
 
 
 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.









Item 2.02.       Results of Operations and Financial Condition.
 
On August 7, 2019, RLJ Lodging Trust (the “Company”) issued a press release announcing its financial results for the quarter ended June 30, 2019.  A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.
 
The information included in this Current Report on Form 8-K (including Exhibit 99.1 hereto) shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference into any filing made by the Company under the Exchange Act or the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.
 
Item 9.01.       Financial Statements and Exhibits.
 
(a)  Not applicable.
 
(b)  Not applicable.
 
(c)  Not applicable.
 
(d)  The following exhibits are filed as part of this report:
 
Exhibit
Number
 
Description
99.1

 
SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
RLJ LODGING TRUST
 
 
Dated: August 7, 2019
By:
/s/ Leslie D. Hale
 
 
Leslie D. Hale
 
 
President ad Chief Executive Officer

EXHIBIT LIST
 
Exhibit
Number
 
Description
99.1

 




Exhibit
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Press Release


RLJ Lodging Trust Reports Second Quarter 2019 Results

- Disposition of two non-core hotel portfolios for approximately $490 million
- Early termination of Wyndham management agreements


Bethesda, MD, August 7, 2019 – RLJ Lodging Trust (the “Company”) (NYSE: RLJ) today reported results for the three and six months ended June 30, 2019.

Highlights of Strategic Initiatives
Sold a 21-hotel portfolio (“Portfolio 21”) in June and under firm contract to sell an 18-hotel portfolio (“Portfolio 18”) in August
Entered into agreement to terminate Wyndham management and NOI guarantee agreements
Sold Kingston Plantation in Myrtle Beach, SC for approximately $156 million in June
Refinanced approximately $0.4 billion of debt
Pro forma RevPAR increased 0.7%, driven by an increase of 0.4% in ADR and 0.3% in Occupancy
Repurchased approximately 3.1 million common shares for approximately $54.3 million

“We had a very successful quarter, in addition to delivering solid operational results, we made significant progress on our strategic initiatives, including entering into agreements to sell two non-core portfolios of slow-growth, low-RevPAR hotels and unlocking significant embedded real estate value by terminating our management and NOI guarantee agreements with Wyndham,” commented Leslie D. Hale, President and Chief Executive Officer. “These transformational transactions improved our portfolio quality, elevated our growth profile, and positioned our portfolio for long-term growth and NAV appreciation. With a fortress balance sheet and over $1 billion of investment capacity, RLJ has multiple levers to create shareholder value.”
The prefix “Pro forma”, as defined by the Company, denotes operating results which include results for periods prior to its ownership and excludes sold hotels. Pro forma RevPAR and Pro forma Hotel EBITDA Margin are reported on a comparable basis and therefore exclude any hotels sold during the period and non-comparable hotels that were not open for operation or were closed for renovation for comparable periods. Explanations of EBITDA, EBITDAre, Adjusted EBITDA, Hotel EBITDA, Hotel EBITDA Margin, FFO, and Adjusted FFO, as well as reconciliations of those measures to net income or loss, if applicable, are included within this release.

Pro forma RevPAR growth for the second quarter was 0.7%. Pro forma RevPAR excluding Portfolio 18, increased 1.1% for the second quarter. The Company's top performing markets were Louisville and Northern California with Pro forma RevPAR growth of 12.1% and 6.9%, respectively.

Net Income for the second quarter was $33.7 million, a decrease of $30.7 million from the comparable period in 2018. For the three months ended June 30, 2019 and June 30, 2018, net income included $32.4 million and $12.0 million, respectively, from sold hotels.

Adjusted EBITDA for the second quarter was $148.4 million, a decrease of $11.5 million from the comparable period in 2018. For the three months ended June 30, 2019 and June 30, 2018, Adjusted EBITDA included $14.3 million and $25.0 million, respectively, from sold hotels.

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Financial and Operating Highlights

($ in thousands, except ADR, RevPAR, and per share amounts)
(unaudited)
 
For the three months ended June 30,
 
For the six months ended June 30,
 
2019
2018
 
Change
 
2019
2018
 
Change
Operational Overview: (1)
 
 
 
 
 
 
 
 
 
Pro forma ADR
$182.44
$181.77
 
0.4
 %
 
$181.05
$178.79
 
1.3
 %
Pro forma Occupancy
82.4
%
82.1
%
 
0.3
 %
 
78.8
%
78.9
%
 
(0.1
)%
Pro forma RevPAR
$150.25
$149.19
 
0.7
 %
 
$142.68
$140.98
 
1.2
 %
 
 
 
 
 
 
 
 
 
 
Financial Overview:
 
 
 
 
 
 
 
 
 
Total Revenues
$448,727
$484,691
 
(7.4
)%
 
$847,994
$914,285
 
(7.3
)%
Pro forma Hotel Revenue
$408,405
$403,987
 
1.1
 %
 
$772,634
$759,323
 
1.8
 %
 
 
 
 
 
 
 
 
 
 
Net Income (2)
$33,681
$64,393
 
(47.7
)%
 
$62,013
$88,286
 
(29.8
)%
 
 
 
 
 
 
 
 
 
 
Pro forma Hotel EBITDA
$143,192
$144,035
 
(0.6
)%
 
$252,822
$251,926
 
0.4
 %
Pro forma Hotel EBITDA Margin
35.1
%
35.7
%
 
(59) bps

 
32.7
%
33.2
%
 
(46) bps

Adjusted EBITDA (3)
$148,381
$159,837
 
(7.2
)%
 
$259,927
$275,629
 
(5.7
)%
 
 
 
 
 
 
 
 
 
 
Adjusted FFO
$119,190
$127,915
 
(6.8
)%
 
$201,830
$209,386
 
(3.6
)%
Adjusted FFO Per Diluted Common Share and Unit
$0.69
$0.73
 
(5.5
)%
 
$1.16
$1.20
 
(3.3
)%
Note:
(1) Pro forma statistics reflect the Company's 127 hotel portfolio as of August 7, 2019, which excludes Portfolio 21 and Kingston Plantation hotels sold in June 2019 but includes Portfolio 18.
(2) For the three months ended June 30, 2019 and 2018, sold hotels contributed $32.4 million and $12.0 million, respectively, to Net Income. For the six months ended June 30, 2019 and 2018, sold hotels contributed $37.0 million and $17.5 million, respectively, to Net Income.
(3) For the three months ended June 30, 2019, and 2018, sold hotels contributed $14.3 million and $25.0 million, respectively, to Adjusted EBITDA. For the six months ended June 30, 2019 and 2018, sold hotels contributed $25.2 million and $41.7 million, respectively, to Adjusted EBITDA.

Prior Quarterly Outlook Bridge
The following table reconciles the Company's results for the second quarter with the outlook issued as of May 8, 2019.
 
Outlook as of
May 8, 2019
 
 
 
Adjusted Outlook
 
 
 
Variance at Midpoint
 
 
Impact of Dispositions
 
 
Actual
 
Pro forma Consolidated Hotel EBITDA
$155.1M to $160.5M
 
($16.7M)
 
$138.4M to $143.8M
 
$143.2M
 
$2.1M
Adjusted EBITDA
$145.0M to $150.1M
 
($1.1M)
 
$143.9M to $149.0M
 
$148.4M
 
$2.0M

Dispositions Update
The Company is providing the following update on recent disposition activity.
Sold two Kingston Plantation hotels with 640 rooms for $156 million in June. The sale equates to a 12.9x trailing multiple, inclusive of planned capital expenditures.
Entered into two transactions to sell 39 non-core legacy hotels for approximately $490 million at a blended 10.6x trailing multiple, inclusive of planned capital requirements:
Portfolio 21 closed in June 2019.
Portfolio 18 is scheduled to close in August 2019. The Company currently holds a $17.5 million non-refundable deposit from the purchaser.


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Please refer to the Schedule of Hotel Dispositions within this release for a list of hotels included in the two transactions.

The sale of Portfolio 18 is subject to customary closing conditions. However, there can be no assurance the Company will be able to successfully consummate the transaction.

Wyndham Termination
The Company entered into a non-binding letter of intent and is finalizing a definitive agreement with Wyndham to terminate the management and NOI guarantee agreements on the Wyndham hotels. The significant terms of termination agreement will include the following:

Management agreement and guarantee will terminate effective December 31, 2019
Wyndham remains obligated to fund the 2019 guarantee payment estimated to be $10 million
RLJ will receive a termination payment of $35.0 million
At RLJ's option, these hotels may operate under transitional franchise and/or management agreements through December 31, 2020, with an extension option through December 31, 2021

The Company is also currently evaluating branding alternatives for the Wyndham hotels and expects rebrandings to occur in stages starting in 2020.

Debt Financing
In April 2019, the Company refinanced approximately $381 million of secured debt, which reduced borrowing costs, extended maturities (including extensions), and improved non-financial terms. In connection with these transactions, the Company entered into a new $200.0 million mortgage loan maturing in April 2024, a new $96.0 million mortgage loan maturing in April 2026, and an amended and restated $85.0 million seven-year floating rate mortgage loan maturing in April 2026.

The cash proceeds received from the two new mortgage loans were used to repay the Company's $150.0 million secured loan maturing in October 2021 and an approximately $140 million secured loan maturing in March 2022.

Share Repurchases
During the second quarter, the Company repurchased 0.4 million shares of its common stock for $7.8 million at an average price per share of $17.56. Year-to-date, as of August 7, 2019, the Company has repurchased approximately 3.1 million shares of its common stock for approximately $54.3 million at an average price per share of $17.29. As of August 7, 2019, the Company's share buyback program had a remaining capacity of approximately $206.0 million.

Balance Sheet
As of June 30, 2019, the Company had $697.6 million of unrestricted cash on its balance sheet, $600.0 million available on its revolving credit facility, and $2.2 billion of debt outstanding.

The Company’s ratio of net debt to Adjusted EBITDA for the trailing twelve-month period ended June 30, 2019, was 3.3x.



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Dividends
The Company’s Board of Trustees declared a cash dividend of $0.33 per common share of beneficial interest in the second quarter. The dividend was paid on July 15, 2019, to shareholders of record as of June 28, 2019.

The Company's Board of Trustees declared a preferred dividend of $0.4875 on its Series A cumulative convertible preferred shares. The dividend was paid on July 31, 2019, to shareholders of record as of June 28, 2019.

Outlook
The Company is adjusting its outlook for the impact of the dispositions. The Company's full-year outlook includes 109 hotels. Pro forma RevPAR growth, Pro forma Hotel EBITDA Margin and Pro forma Consolidated Hotel EBITDA excludes Portfolio 21, Portfolio 18, and Kingston Plantation for all periods presented. The Company's outlook for Adjusted EBITDA and Adjusted FFO per Diluted Share and Unit includes Portfolio 21, Portfolio 18, and Kingston Plantation for the Company's ownership period. Other than Portfolio 18, future acquisitions, dispositions, financings, or share repurchases are not incorporated into the Company's outlook below and could result in a material change to the Company's outlook.

 
Prior Outlook as of
May 8, 2019
 
 
 
Adjusted Outlook
 
 
Impact of Dispositions
 
Pro forma RevPAR growth
0.0% to +2.0%
 
-
 
0.0% to +2.0%
Pro forma Hotel EBITDA Margin
31.8% to 32.6%
 
-20 bps to -40 bps
 
31.6% to 32.2%
Pro forma Consolidated Hotel EBITDA
$527.0M to $552.0M
 
($78.0M)
 
$449.0M to $474.0M
Corporate Cash General & Administrative
$35.0M to $36.0M
 
-
 
$35.0M to $36.0M
Adjusted EBITDA
$492.0M to $517.0M
 
($37.0M)
 
$455.0M to $480.0M
Adjusted FFO per Diluted Share and Unit
$2.18 to $2.30
 
($0.20)
 
$1.98 to $2.10

Additionally, key assumptions underlying the Company's full year 2019 outlook include:

Closing of the Portfolio 18 sale in August
Net interest expense of $88 million to $90 million, which excludes the impact of unrealized gains or losses related to interest rate hedges
Capital expenditures related to renovations in the range of $90 million to $110 million and approximately 40 bps to 50 bps of renovation related RevPAR disruption
Cash income tax expense of $3 million to $4 million
Diluted weighted-average common shares and units of 172.9 million, assuming no additional share repurchases

For the third quarter 2019, the Company anticipates Pro forma Consolidated Hotel EBITDA to be between 23.8% and 24.8% of the Company's full year 2019 outlook, calculated at the midpoint of the respective outlook range.

Investor Presentation and Supplemental Information
Please refer to the investor presentation and the schedule of supplemental information posted to the Company's website for additional details on the disposition transactions and pro forma operating statistics.

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Earnings Call
The Company will conduct its quarterly analyst and investor conference call on August 8, 2019, at
10:00 a.m. (Eastern Time). The conference call can be accessed by dialing (877) 407-3982 or (201) 493-6780 for international participants and requesting RLJ Lodging Trust’s second quarter earnings conference call. Additionally, a live webcast of the conference call will be available through the Company’s website at http://www.rljlodgingtrust.com. A replay of the conference call webcast will be archived and available online through the Investor Relations page of the Company’s website.

About Us
RLJ Lodging Trust is a self-advised, publicly traded real estate investment trust that owns primarily premium-branded, high-margin, focused-service and compact full-service hotels. As of June 30, 2019, the Company's portfolio consisted of 127 hotels with approximately 25,400 rooms located in 23 states and the District of Columbia and an ownership interest in one unconsolidated hotel with 171 rooms.

Forward Looking Statements
The following information contains certain statements, other than purely historical information, including estimates, projections, statements relating to the Company’s business plans, objectives and expected operating results, and the assumptions upon which those statements are based, that are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements generally are identified by the use of the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “plan,” “may,” “will,” “will continue,” “intend,” “should,” or similar expressions. Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, beliefs, and expectations, such forward-looking statements are not predictions of future events or guarantees of future performance and the Company’s actual results could differ materially from those set forth in the forward-looking statements. Some factors that might cause such a difference include the following: the current global economic uncertainty, increased direct competition, changes in government regulations or accounting rules, changes in local, national, and global real estate conditions, declines in the lodging industry, seasonality of the lodging industry, risks related to natural disasters, such as earthquakes and hurricanes, hostilities, including future terrorist attacks or fear of hostilities that affect travel, the Company’s ability to obtain lines of credit or permanent financing on satisfactory terms, changes in interest rates, access to capital through offerings of the Company’s common and preferred shares of beneficial interest, or debt, the Company’s ability to identify suitable acquisitions, the Company’s ability to close on identified acquisitions and integrate those businesses, and inaccuracies of the Company’s accounting estimates. Given these uncertainties, undue reliance should not be placed on such statements. Except as required by law, the Company undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events, or otherwise. The Company cautions investors not to place undue reliance on these forward-looking statements and urges investors to carefully review the disclosures the Company makes concerning risks and uncertainties in the sections entitled “Risk Factors,” “Forward-Looking Statements,” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s Annual Report, as well as risks, uncertainties, and other factors discussed in other documents filed by the Company with the Securities and Exchange Commission. 


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###
 Additional Contacts:
Sean M. Mahoney, Executive Vice President and Chief Financial Officer – (301) 280-7774
For additional information or to receive press releases via email, please visit our website:
 http://www.rljlodgingtrust.com

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RLJ Lodging Trust
Non-GAAP and Accounting Commentary
 
Non-Generally Accepted Accounting Principles (“Non-GAAP”) Financial Measures
The Company considers the following non-GAAP financial measures useful to investors as key supplemental measures of its performance: (1) FFO, (2) Adjusted FFO, (3) EBITDA, (4) EBITDAre, (5) Adjusted EBITDA, (6) Hotel EBITDA, and (7) Hotel EBITDA Margin. These Non-GAAP financial measures should be considered along with, but not as alternatives to, net income or loss as a measure of its operating performance. FFO, Adjusted FFO, EBITDA, EBITDAre, Adjusted EBITDA, Hotel EBITDA, and Hotel EBITDA Margin as calculated by the Company, may not be comparable to other companies that do not define such terms exactly as the Company.
 
Funds From Operations (“FFO”)
The Company calculates Funds from Operations (“FFO”) in accordance with standards established by the National Association of Real Estate Investment Trusts, or NAREIT, which defines FFO as net income or loss (calculated in accordance with GAAP), excluding gains or losses from sales of real estate, impairment, the cumulative effect of changes in accounting principles, plus depreciation and amortization, and adjustments for unconsolidated partnerships and joint ventures. Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values instead have historically risen or fallen with market conditions, most real estate industry investors consider FFO to be helpful in evaluating a real estate company’s operations. The Company believes that the presentation of FFO provides useful information to investors regarding the Company’s operating performance and can facilitate comparisons of operating performance between periods and between real estate investment trusts (“REITs”), even though FFO does not represent an amount that accrues directly to common shareholders.
 
The Company’s calculation of FFO may not be comparable to measures calculated by other companies who do not use the NAREIT definition of FFO or do not calculate FFO per diluted share in accordance with NAREIT guidance. Additionally, FFO may not be helpful when comparing the Company to non-REITs. The Company presents FFO attributable to common shareholders, which includes unitholders of limited partnership interest (“OP units”) in RLJ Lodging Trust, L.P., the Company’s operating partnership, because the OP units are redeemable for common shares of the Company. The Company believes it is meaningful for the investor to understand FFO attributable to all common shares and OP units.

EBITDA and EBITDAre
Earnings Before Interest, Taxes, Depreciation, and Amortization (“EBITDA”) is defined as net income or loss excluding: (1) interest expense; (2) provision for income taxes, including income taxes applicable to sales of assets; and (3) depreciation and amortization. The Company considers EBITDA useful to an investor in evaluating and facilitating comparisons of its operating performance between periods and between REITs by removing the impact of its capital structure (primarily interest expense) and asset base (primarily depreciation and amortization) from its operating results. In addition, EBITDA is used as one measure in determining the value of hotel acquisitions and dispositions.

In addition to EBITDA, the Company presents EBITDAre in accordance with NAREIT guidelines, which defines EBITDAre as net income or loss (calculated in accordance with GAAP) excluding interest expense, income tax expense, depreciation and amortization expense, gains or losses from sales

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of real estate, impairment, and adjustments for unconsolidated partnerships and joint ventures. The Company believes that the presentation of EBITDAre provides useful information to investors regarding the Company’s operating performance and can facilitate comparisons of operating performance between periods and between REITs.

Adjustments to FFO and EBITDAre
The Company adjusts FFO, EBITDA, and EBITDAre for certain items that the Company considers either outside the normal course of operations or extraordinary. The Company believes that Adjusted FFO, Adjusted EBITDA, and Adjusted EBITDAre provide useful supplemental information to investors regarding its ongoing operating performance that, when considered with net income or loss, FFO, EBITDA, and EBITDAre, are beneficial to an investor’s understanding of its operating performance. The Company adjusts FFO, EBITDA, and EBITDAre for the following items:

Transaction Costs: The Company excludes transaction costs expensed during the period.
Non-Cash Expenses: The Company excludes the effect of certain non-cash items such as the amortization of share-based compensation and non-cash income taxes.
Other Non-Operational Expenses: The Company excludes the effect of certain non-operational expenses representing income and expenses outside of the normal course of operations

The Company previously presented Adjusted EBITDA with adjustments for noncontrolling interests in consolidated joint ventures. The rationale for including 100% of Adjusted EBITDA for consolidated joint ventures with noncontrolling interests is that the full amount of any debt of these consolidated joint ventures is reported in our consolidated balance sheet and metrics using debt to EBITDA provide a better understanding of the Company’s leverage. This is also consistent with NAREIT’s definition of EBITDAre.

Hotel EBITDA and Hotel EBITDA Margin
With respect to Consolidated Hotel EBITDA, the Company believes that excluding the effect of corporate-level expenses and certain non-cash items provides a more complete understanding of the operating results over which individual hotels and operators have direct control. The Company believes property-level results provide investors with supplemental information about the ongoing operational performance of the Company’s hotels and the effectiveness of its third-party management companies.
 
Pro forma Consolidated Hotel EBITDA includes prior ownership information provided by the sellers of the hotels for periods prior to our acquisition of the hotels, which has not been audited and excludes results from sold hotels as applicable. Pro forma Hotel EBITDA and Pro forma Hotel EBITDA Margin exclude the results of any non-comparable hotels that were under renovation or not open for the entirety of the comparable periods. The following is a summary of pro forma hotel adjustments:

Pro forma adjustments: Acquired hotels
For the three and six months ended June 30, 2019 and 2018, respectively, no hotels were acquired.


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Pro forma adjustments: Sold hotels
For the three and six months ended June 30, 2019 and 2018, pro forma adjustments included the hotels shown on the Schedule of Hotel Dispositions within this release, with the exception of Portfolio 18, and the following sold hotels:

Embassy Suites Boston - Marlborough
Sheraton Philadelphia Society Hill Hotel
Embassy Suites Napa Valley
DoubleTree Columbia
The Vinoy Renaissance St. Petersburg Resort & Golf Club
DoubleTree by Hilton Burlington Vermont
Holiday Inn San Francisco - Fisherman's Wharf

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RLJ Lodging Trust
Consolidated Balance Sheets
(Amounts in thousands, except share and per share data)
(unaudited)
 
June 30,
2019
 
December 31, 2018
Assets
 

 
 

Investment in hotel properties, net
$
4,706,110

 
$
5,378,651

Investment in unconsolidated joint ventures
16,612

 
22,279

Cash and cash equivalents
697,600

 
320,147

Restricted cash reserves
48,330

 
64,695

Hotel and other receivables, net of allowance of $352 and $598, respectively
65,019

 
52,115

Lease right-of-use assets
147,023

 

Deferred income tax asset, net
43,343

 
47,395

Intangible assets, net
173

 
52,448

Prepaid expense and other assets
48,018

 
67,367

Hotel properties held for sale, net
169,439

 

Total assets
$
5,941,667

 
$
6,005,097

Liabilities and Equity
 

 
 

Debt, net
$
2,200,722

 
$
2,202,676

Accounts payable and other liabilities
183,791

 
203,833

Deferred income tax liability
2,766

 
2,766

Advance deposits and deferred revenue
23,125

 
25,411

Lease liabilities
122,399

 

Accrued interest
6,922

 
7,913

Distributions payable
64,941

 
65,557

Total liabilities
2,604,666

 
2,508,156

Equity
 

 
 

Shareholders’ equity:
 

 
 

Preferred shares of beneficial interest, $0.01 par value, 50,000,000 shares authorized
 
 
 
Series A Cumulative Convertible Preferred Shares, $0.01 par value, 12,950,000 shares authorized; 12,879,475 shares issued and outstanding, liquidation value of $328,266, at June 30, 2019 and December 31, 2018
366,936

 
366,936

Common shares of beneficial interest, $0.01 par value, 450,000,000 shares authorized; 173,459,015 and 174,019,616 shares issued and outstanding at June 30, 2019 and December 31, 2018, respectively
1,735

 
1,740

Additional paid-in capital
3,182,351

 
3,195,381

Accumulated other comprehensive (loss) income
(21,836
)
 
16,195

Distributions in excess of net earnings
(216,583
)
 
(150,476
)
Total shareholders’ equity
3,312,603

 
3,429,776

Noncontrolling interest:
 

 
 

Noncontrolling interest in consolidated joint ventures
13,957

 
11,908

Noncontrolling interest in the Operating Partnership
10,441

 
10,827

Total noncontrolling interest
24,398

 
22,735

Preferred equity in a consolidated joint venture, liquidation value of $45,544 at December 31, 2018

 
44,430

Total equity
3,337,001

 
3,496,941

Total liabilities and equity
$
5,941,667

 
$
6,005,097


Note:
The corresponding notes to the consolidated financial statements can be found in the Company’s Quarterly Report on Form 10-Q.







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RLJ Lodging Trust
Consolidated Statements of Operations
(Amounts in thousands, except share and per share data)
(unaudited)
 
For the three months ended June 30,
 
For the six months ended June 30,
 
2019
 
2018
 
2019
 
2018
Revenues
 

 
 

 
 
 
 
Operating revenues
 

 
 

 
 
 
 
Room revenue
$
378,857

 
$
403,232

 
$
716,527

 
$
760,877

Food and beverage revenue
49,458

 
58,444

 
93,704

 
110,639

Other revenue
20,412

 
23,015

 
37,763

 
42,769

Total revenues
$
448,727

 
$
484,691

 
$
847,994

 
$
914,285

Expenses
 

 
 

 
 
 
 
Operating expenses
 

 
 

 
 
 
 
Room expense
$
88,898

 
$
94,459

 
$
173,086

 
$
184,428

Food and beverage expense
35,910

 
42,406

 
70,119

 
83,669

Management and franchise fee expense
35,825

 
37,252

 
69,944

 
72,928

Other operating expense
101,596

 
108,556

 
198,713

 
214,679

Total property operating expenses
262,229

 
282,673

 
511,862

 
555,704

Depreciation and amortization
54,956

 
61,648

 
113,359

 
123,056

Property tax, insurance and other
31,201

 
35,537

 
61,797

 
70,036

General and administrative
11,765

 
15,523

 
22,925

 
26,436

Transaction costs
425

 
247

 
984

 
1,920

Total operating expenses
360,576

 
395,628

 
710,927

 
777,152

Other income
349

 
565

 
622

 
1,657

Interest income
1,073

 
960

 
2,245

 
2,190

Interest expense
(25,237
)
 
(25,443
)
 
(45,299
)
 
(54,144
)
(Loss) gain on sale of hotel properties and hotel properties held for sale, net
(24,835
)
 
796

 
(24,835
)
 
(2,938
)
Gain on extinguishment of indebtedness, net

 
7

 

 
7,666

Income before equity in (loss) income from unconsolidated joint ventures
39,501

 
65,948

 
69,800

 
91,564

Equity in (loss) income from unconsolidated joint ventures
(2,403
)
 
799

 
(2,784
)
 
418

Income before income tax expense
37,098

 
66,747

 
67,016

 
91,982

Income tax expense
(3,417
)
 
(2,354
)
 
(5,003
)
 
(3,696
)
Net income
33,681

 
64,393

 
62,013

 
88,286

Net (income) loss attributable to noncontrolling interests:
 

 
 

 
 
 
 
Noncontrolling interest in consolidated joint ventures
(96
)
 
(55
)
 
256

 
179

Noncontrolling interest in the Operating Partnership
(141
)
 
(254
)
 
(233
)
 
(327
)
Preferred distributions - consolidated joint venture

 
(370
)
 
(186
)
 
(735
)
Redemption of preferred equity - consolidated joint venture

 

 
(1,153
)
 

Net income attributable to RLJ
33,444

 
63,714

 
60,697

 
87,403

Preferred dividends
(6,279
)
 
(6,279
)
 
(12,557
)
 
(12,557
)
Net income attributable to common shareholders
$
27,165

 
$
57,435

 
$
48,140

 
$
74,846

Basic per common share data:
 
 
 
 
 
 
 
Net income per share attributable to common shareholders
$
0.16

 
$
0.33

 
$
0.27

 
$
0.43

Weighted-average number of common shares
172,661,878

 
174,238,854

 
172,729,064

 
174,216,387

Diluted per common share data:
 
 
 
 
 
 
 
Net income per share attributable to common shareholders
$
0.16

 
$
0.33

 
$
0.27

 
$
0.43

Weighted-average number of common shares
172,766,091

 
174,364,547

 
172,808,513

 
174,316,348

 

Note:
The Statements of Comprehensive Income and corresponding notes to the consolidated financial statements can be found in the Company’s Quarterly
Report on Form 10-Q.

11

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RLJ Lodging Trust
Reconciliation of Non-GAAP Measures
(Amounts in thousands, except per share data)
(unaudited)

Funds from Operations (FFO) Attributable to Common Shareholders and Unitholders
 
For the three months ended June 30,
 
For the six months ended June 30,
 
2019
 
2018
 
2019
 
2018
Net income
$
33,681

 
$
64,393

 
$
62,013

 
$
88,286

Preferred dividends
(6,279
)
 
(6,279
)
 
(12,557
)
 
(12,557
)
Preferred distributions - consolidated joint venture

 
(370
)
 
(186
)
 
(735
)
Redemption of preferred equity - consolidated joint venture

 

 
(1,153
)
 

Depreciation and amortization
54,956

 
61,648

 
113,359

 
123,056

Loss (gain) on sale of hotel properties and hotel properties held for sale, net
24,835

 
(796
)
 
24,835

 
2,938

Noncontrolling interest in consolidated joint ventures
(96
)
 
(55
)
 
256

 
179

Adjustments related to consolidated joint ventures (1)
(75
)
 
(80
)
 
(149
)
 
(155
)
Adjustments related to unconsolidated joint ventures (2)
3,534

 
669

 
4,228

 
1,337

FFO
110,556

 
119,130

 
190,646

 
202,349

Transaction costs
425

 
247

 
984

 
1,920

Gain on extinguishment of indebtedness, net

 
(7
)
 

 
(7,666
)
Amortization of share-based compensation
3,035

 
3,172

 
5,760

 
5,686

Non-cash income tax expense
2,770

 
1,826

 
4,052

 
2,929

Other expenses (3)
2,404

 
3,547

 
388

 
4,168

Adjusted FFO
$
119,190

 
$
127,915

 
$
201,830

 
$
209,386

 
 
 
 
 
 
 
 
Adjusted FFO per common share and unit-basic
$
0.69

 
$
0.73

 
$
1.16

 
$
1.20

Adjusted FFO per common share and unit-diluted
$
0.69

 
$
0.73

 
$
1.16

 
$
1.20

 
 
 
 
 
 
 
 
Basic weighted-average common shares and units outstanding (4)
173,435

 
175,013

 
173,502

 
174,990

Diluted weighted-average common shares and units outstanding (4)
173,539

 
175,138

 
173,581

 
175,090


Note:
(1) Includes depreciation and amortization expense allocated to the noncontrolling interest in the consolidated joint ventures.
(2)  Includes our ownership interest in the depreciation and amortization expense and loss on sale of the unconsolidated joint ventures.
(3) Represents income and expenses outside of the normal course of operations, including debt modification costs, hurricane-related costs that were not reimbursed by insurance, executive transition costs, activist shareholder costs, and unrealized gains and losses on certain discontinued cash flow hedges.
(4)  Includes 0.8 million weighted-average operating partnership units for the three and six month periods ended June 30, 2019 and 2018, respectively.














12

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RLJ Lodging Trust
Reconciliation of Non-GAAP Measures
(Amounts in thousands)
(unaudited)
 
Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA)
 
For the three months ended June 30,
 
For the six months ended June 30,
 
2019
 
2018
 
2019
 
2018
Net income
$
33,681

 
$
64,393

 
$
62,013

 
$
88,286

Depreciation and amortization
54,956

 
61,648

 
113,359

 
123,056

Interest expense, net of interest income
24,164

 
24,483

 
43,055

 
51,954

Income tax expense
3,417

 
2,354

 
5,003

 
3,696

Adjustments related to unconsolidated joint ventures (1)
736

 
796

 
1,552

 
1,591

EBITDA
116,954

 
153,674

 
224,982

 
268,583

Loss (gain) on sale of hotel properties and hotel properties held for sale, net
24,835

 
(796
)
 
24,835

 
2,938

Loss on sale of unconsolidated joint ventures (2)
2,923

 

 
2,923

 

EBITDAre
144,712

 
152,878

 
252,740

 
271,521

Transaction costs
425

 
247

 
984

 
1,920

Gain on extinguishment of indebtedness, net

 
(7
)
 

 
(7,666
)
Amortization of share-based compensation
3,035

 
3,172

 
5,760

 
5,686

Other expenses (3)
209

 
3,547

 
443

 
4,168

Adjusted EBITDA
148,381

 
159,837

 
259,927

 
275,629

General and administrative (4)
8,730

 
9,152

 
17,156

 
17,446

Other corporate adjustments (5)
422

 
55

 
977

 
542

Consolidated Hotel EBITDA
157,533

 
169,044

 
278,060

 
293,617

Pro forma adjustments - income from sold hotels
(14,341
)
 
(25,009
)
 
(25,238
)
 
(41,691
)
Pro forma Consolidated Hotel EBITDA
143,192

 
144,035

 
252,822

 
251,926

Pro forma adjustments - income from non-comparable hotels

 

 

 

Pro forma Hotel EBITDA
$
143,192

 
$
144,035

 
$
252,822

 
$
251,926


Note:
(1) Includes our ownership interest in the interest, depreciation, and amortization expense of the unconsolidated joint ventures.
(2) Includes our ownership interest in the loss on sale of the unconsolidated joint ventures associated with two resort hotel properties owned by the Company in Myrtle Beach, SC.
(3) Represents income and expenses outside of the normal course of operations, including debt modification costs, hurricane-related costs that were not reimbursed by insurance, executive transition costs, and activist shareholder costs.
(4) Excludes amortization of share-based compensation and activist shareholder costs reflected in Adjusted EBITDA.
(5) Other corporate adjustments include property-level adjustments and certain revenues and expenses at corporate entities. These items include interest income, amortization of deferred management fees, key money amortization, ground rent amortization, legal fees, revenues and expenses associated with non-hotel properties, income (loss) from unconsolidated entities, internal lease rent expense, and other items.



13

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RLJ Lodging Trust
Reconciliation of Non-GAAP Measures
(Amounts in thousands)
(unaudited)
 
Pro forma Hotel EBITDA Margin
 
For the three months ended June 30,
 
For the six months ended June 30,
 
2019
 
2018
 
2019
 
2018
Total revenue
$
448,727

 
$
484,691

 
$
847,994

 
$
914,285

Pro forma adjustments - revenue from sold hotels
(39,327
)
 
(79,491
)
 
(73,992
)
 
(153,336
)
Other corporate adjustments / non-hotel revenue
(995
)
 
(1,213
)
 
(1,368
)
 
(1,626
)
Pro forma Hotel Revenue
$
408,405

 
$
403,987

 
$
772,634

 
$
759,323

 
 
 
 
 
 
 
 
Pro forma Hotel EBITDA
$
143,192

 
$
144,035

 
$
252,822

 
$
251,926

 
 
 
 
 
 
 
 
Pro forma Hotel EBITDA Margin
35.1
%
 
35.7
%
 
32.7
%
 
33.2
%










14

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RLJ Lodging Trust
Consolidated Debt Summary
(Amounts in thousands)
(unaudited)
Loan
Base Term (Years)
Maturity
(incl. extensions)
Floating / Fixed
Interest Rate (1)
 
Balance as of
June 30, 2019 (2)
Secured Debt
 
 
 
 
 
 
Mortgage loan - 1 hotel
10
Jun 2022
Fixed
5.25
%
 
$
31,089

Mortgage loan - 2 hotels
10
Oct 2022
Fixed
4.95
%
 
56,448

Mortgage loan - 1 hotel
10
Oct 2022
Fixed
4.95
%
 
32,446

Mortgage loan - 1 hotel
10
Oct 2022
Fixed
4.94
%
 
28,662

Mortgage loan - 7 hotels
3
Apr 2024
Floating (3)
3.33
%
 
200,000

Mortgage loan - 3 hotels
5
Apr 2026
Floating
4.00
%
 
96,000

Mortgage loan - 4 hotels
5
Apr 2026
Floating (3)(5)
3.42
%
 
85,000

Weighted-Average / Secured Total
 
 
 
3.94
%
 
$
529,645

 
 
 
 
 
 
 
Unsecured Debt
 
 
 
 
 
 
Revolver (4)
4
Apr 2021
Floating
3.90
%
 
$

$400 Million Term Loan Maturing 2021
5
Apr 2021
Floating (3)(5)
3.10
%
 
400,000

$150 Million Term Loan Maturing 2022
7
Jan 2022
Floating (3)
3.08
%
 
150,000

$400 Million Term Loan Maturing 2023
5
Jan 2023
Floating (3)
3.78
%
 
400,000

$225 Million Term Loan Maturing 2023
5
Jan 2023
Floating (3)
3.78
%
 
225,000

Senior Unsecured Notes
10
Jun 2025
Fixed
6.00
%
 
475,000

Weighted-Average / Unsecured Total
 
 
 
4.19
%
 
$
1,650,000

 
 
 
 
 
 
 
Weighted-Average / Gross Debt
 
 
 
4.13
%
 
$
2,179,645

Note:
(1) Interest rates as of June 30, 2019.
(2) Excludes the impact of fair value adjustments and deferred financing costs.
(3) The floating interest rate is hedged with an interest rate swap.
(4) As of June 30, 2019, there was $600.0 million of borrowing capacity on the revolver, which is charged an unused commitment fee of 0.30% annually.
(5) Reflects an interest rate swap of $81.8 million on the $85.0 million mortgage loan and $350.0 million on the $400.0 million term loan.





15

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RLJ Lodging Trust
Pro forma Operating Statistics - Top 60 Assets
(unaudited)
Property
City/State
 # of Rooms
Pro forma Consolidated Hotel EBITDA
The Knickerbocker New York
New York, NY
330
$13,503
Marriott Louisville Downtown
Louisville, KY
620
12,943
Wyndham San Diego Bayside
San Diego, CA
600
10,653
San Francisco Marriott Union Square
San Francisco, CA
401
10,603
Wyndham Boston Beacon Hill
Boston, MA
304
9,744
The Mills House Wyndham Grand Hotel
Charleston, SC
216
9,047
Embassy Suites San Francisco Airport - Waterfront
Burlingame, CA
340
9,009
Courtyard Austin Downtown Convention Center
Austin, TX
270
8,760
Embassy Suites San Francisco Airport - South San Francisco
South San Francisco, CA
312
8,272
Embassy Suites Los Angeles - International Airport South
El Segundo, CA
349
8,016
DoubleTree Grand Key Resort
Key West, FL
216
7,918
Wyndham New Orleans - French Quarter
New Orleans, LA
374
7,917
Embassy Suites Fort Lauderdale 17th Street
Fort Lauderdale, FL
361
7,895
Embassy Suites Mandalay Beach - Hotel & Resort
Oxnard, CA
250
7,432
Courtyard San Francisco
San Francisco, CA
166
7,431
Courtyard Portland City Center
Portland, OR
256
7,421
Residence Inn Palo Alto Los Altos
Los Altos, CA
156
7,173
Renaissance Pittsburgh Hotel
Pittsburgh, PA
300
6,804
Hilton Garden Inn San Francisco Oakland Bay Brg
Emeryville, CA
278
6,795
DoubleTree Metropolitan Hotel New York City
New York, NY
764
6,510
Embassy Suites Deerfield Beach - Resort & Spa
Deerfield Beach, FL
244
6,432
Hyatt House Emeryville San Francisco Bay Area
Emeryville, CA
234
6,408
Wyndham Philadelphia Historic District
Philadelphia, PA
364
6,404
Courtyard Waikiki Beach
Honolulu, HI
403
6,338
Fairfield Inn & Suites Washington DC Downtown
Washington, DC
198
6,055
Wyndham Santa Monica At the Pier
Santa Monica, CA
132
5,979
Hyatt House San Jose Silicon Valley
San Jose, CA
164
5,937
Embassy Suites Atlanta - Buckhead
Atlanta, GA
316
5,887
Courtyard Chicago Downtown Magnificent Mile
Chicago, IL
306
5,860
Hyatt House Santa Clara
Santa Clara, CA
150
5,818
Embassy Suites Milpitas Silicon Valley
Milpitas, CA
266
5,505
Courtyard Charleston Historic District
Charleston, SC
176
5,443
DoubleTree Suites by Hilton Austin
Austin, TX
188
5,437
Embassy Suites Tampa Downtown Convention Center
Tampa, FL
360
5,391
Wyndham Houston - Medical Center Hotel & Suites
Houston, TX
287
5,338
Marriott Denver South @ Park Meadows
Lone Tree, CO
279
5,200
Embassy Suites Boston Waltham
Waltham, MA
275
5,040
Residence Inn Bethesda Downtown
Bethesda, MD
188
5,026
Residence Inn Austin Downtown Convention Center
Austin, TX
179
4,881
Hyatt House San Diego Sorrento Mesa
San Diego, CA
193
4,858
Hilton Cabana Miami Beach
Miami Beach, FL
231
4,765
Hyatt Centric Midtown Atlanta
Atlanta, GA
194
4,765
Renaissance Fort Lauderdale Plantation Hotel
Plantation, FL
250
4,626
Embassy Suites Orlando - International Drive South/Convention Center
Orlando, FL
244
4,565
Homewood Suites Washington DC Downtown
Washington, DC
175
4,455
Embassy Suites Irvine Orange County
Irvine, CA
293
4,418
Hilton Garden Inn Los Angeles Hollywood
Los Angeles, CA
160
4,343
Embassy Suites Dallas - Love Field
Dallas, TX
248
4,203
Hyatt Place Washington DC Downtown K Street
Washington, DC
164
4,130
Embassy Suites Los Angeles Downey
Downey, CA
220
3,973
Embassy Suites Miami - International Airport
Miami, FL
318
3,896
Renaissance Boulder Flatiron Hotel
Broomfield, CO
232
3,864
Hyatt House San Ramon
San Ramon, CA
142
3,823
Embassy Suites Phoenix - Biltmore
Phoenix, AZ
232
3,711
Marriott Denver Airport @ Gateway Park
Aurora, CO
238
3,664
Residence Inn National Harbor Washington DC
Oxon Hill, MD
162
3,597
Hyatt Place Fremont Silicon Valley
Fremont, CA
151
3,589
Wyndham Pittsburgh University Center
Pittsburgh, PA
251
3,538
Hilton Garden Inn New Orleans Convention Center
New Orleans, LA
286
3,509
Embassy Suites Minneapolis - Airport
Bloomington, MN
310
3,472
Top 60 Assets
 
16,266
367,989
Other (67 Assets)
 
9,140
118,944
Total Portfolio
 
25,406
$486,933
Note: For the trailing twelve months ended June 30, 2019. Results reflect the Company's 127 hotel portfolio as of June 30, 2019, that excludes Portfolio 21 and Kingston Plantation sold in June 2019, but includes Portfolio 18 under contract to be sold. Results reflect 100% of the financial results of three consolidated joint ventures and exclude the Chateau LeMoyne-French Quarter New Orleans, which is an unconsolidated hotel. Amounts in thousands, except rooms. Unaudited information presented only for comparison purposes.

16

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RLJ Lodging Trust
Pro forma Operating Statistics
(unaudited)

For the three months ended June 30, 2019 and 2018
Top Markets
 
# of Hotels
 
Occupancy
 
ADR
 
RevPAR
2019
2018
Var
2019
2018
Var
2019
2018
Var
Northern California
 
12
 
88.6
%
85.0
%
4.2
 %
 
$
234.78

$
228.92

2.6
 %
 
$
207.92

$
194.50

6.9
 %
Southern California
 
9
 
85.4
%
86.5
%
(1.2
)%
 
181.91

182.54

(0.3
)%
 
155.42

157.88

(1.6
)%
South Florida
 
8
 
83.2
%
86.3
%
(3.5
)%
 
168.58

167.53

0.6
 %
 
140.30

144.54

(2.9
)%
Austin
 
13
 
78.6
%
79.9
%
(1.5
)%
 
170.44

165.51

3.0
 %
 
134.04

132.21

1.4
 %
New York City
 
5
 
92.5
%
91.7
%
0.9
 %
 
248.35

250.44

(0.8
)%
 
229.73

229.71

0.0
 %
Washington, DC
 
6
 
86.6
%
88.5
%
(2.1
)%
 
225.50

225.48

0.0
 %
 
195.25

199.47

(2.1
)%
Houston
 
11
 
71.3
%
74.3
%
(4.0
)%
 
137.70

143.43

(4.0
)%
 
98.21

106.58

(7.9
)%
Chicago
 
13
 
83.5
%
78.1
%
6.8
 %
 
148.49

154.12

(3.6
)%
 
123.93

120.38

2.9
 %
Louisville
 
5
 
73.4
%
67.1
%
9.3
 %
 
185.97

181.37

2.5
 %
 
136.42

121.72

12.1
 %
Denver
 
9
 
79.5
%
79.5
%
(0.1
)%
 
141.56

144.33

(1.9
)%
 
112.48

114.81

(2.0
)%
Other
 
36
 
81.1
%
81.5
%
(0.5
)%
 
170.07

169.21

0.5
 %
 
137.94

137.97

0.0
 %
Total
 
127
 
82.4
%
82.1
%
0.3
 %
 
$
182.44

$
181.77

0.4
 %
 
$
150.25

$
149.19

0.7
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Service Level
 
# of Hotels
 
Occupancy
 
ADR
 
RevPAR
2019
2018
Var
2019
2018
Var
2019
2018
Var
Focused-Service
 
81
 
81.2
%
81.8
%
(0.7
)%
 
$
171.31

$
172.21

(0.5
)%
 
$
139.17

$
140.87

(1.2
)%
Compact Full-Service
 
45
 
83.9
%
83.4
%
0.5
 %
 
190.99

189.25

0.9
 %
 
160.16

157.92

1.4
 %
Full-Service
 
1
 
73.5
%
59.5
%
23.5
 %
 
224.53

225.34

(0.4
)%
 
165.09

134.12

23.1
 %
Total
 
127
 
82.4
%
82.1
%
0.3
 %
 
$
182.44

$
181.77

0.4
 %
 
$
150.25

$
149.19

0.7
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Chain Scale
 
# of Hotels
 
Occupancy
 
ADR
 
RevPAR
2019
2018
Var
2019
2018
Var
2019
2018
Var
Upper Upscale
 
35
 
81.6
%
80.6
%
1.2
 %
 
$
185.34

$
182.20

1.7
 %
 
$
151.21

$
146.83

3.0
 %
Upscale
 
80
 
82.8
%
83.2
%
(0.5
)%
 
178.37

179.33

(0.5
)%
 
147.70

149.28

(1.1
)%
Upper Midscale
 
10
 
81.7
%
80.2
%
1.9
 %
 
162.59

164.32

(1.1
)%
 
132.80

131.77

0.8
 %
Other
 
2
 
86.0
%
81.8
%
5.2
 %
 
304.17

300.88

1.1
 %
 
261.57

245.99

6.3
 %
Total
 
127
 
82.4
%
82.1
%
0.3
 %
 
$
182.44

$
181.77

0.4
 %
 
$
150.25

$
149.19

0.7
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Flags
 
# of Hotels
 
Occupancy
 
ADR
 
RevPAR
2019
2018
Var
2019
2018
Var
2019
2018
Var
Embassy Suites
 
21
 
83.2
%
82.8
%
0.4
 %
 
$
175.19

$
173.30

1.1
 %
 
$
145.76

$
143.54

1.5
 %
Residence Inn
 
21
 
80.7
%
82.1
%
(1.7
)%
 
162.90

164.96

(1.2
)%
 
131.46

135.43

(2.9
)%
Courtyard
 
20
 
81.4
%
82.1
%
(0.7
)%
 
181.94

181.58

0.2
 %
 
148.19

149.01

(0.6
)%
Hyatt House
 
11
 
86.5
%
85.9
%
0.6
 %
 
176.53

178.41

(1.1
)%
 
152.64

153.33

(0.4
)%
Wyndham
 
8
 
83.6
%
83.5
%
0.2
 %
 
184.76

185.71

(0.5
)%
 
154.43

154.99

(0.4
)%
SpringHill Suites
 
7
 
71.6
%
74.5
%
(4.0
)%
 
132.93

131.59

1.0
 %
 
95.14

98.08

(3.0
)%
Marriott
 
6
 
79.4
%
73.4
%
8.1
 %
 
210.16

202.65

3.7
 %
 
166.79

148.76

12.1
 %
Fairfield Inn & Suites
 
6
 
85.4
%
83.4
%
2.4
 %
 
174.92

175.92

(0.6
)%
 
149.42

146.80

1.8
 %
Hilton Garden Inn
 
5
 
82.1
%
81.1
%
1.3
 %
 
172.08

174.45

(1.4
)%
 
141.34

141.44

(0.1
)%
DoubleTree
 
4
 
94.1
%
92.0
%
2.3
 %
 
214.76

219.93

(2.3
)%
 
202.13

202.40

(0.1
)%
Renaissance
 
3
 
76.0
%
80.6
%
(5.7
)%
 
171.98

167.93

2.4
 %
 
130.78

135.41

(3.4
)%
Hyatt Place
 
3
 
79.3
%
84.7
%
(6.4
)%
 
205.77

203.11

1.3
 %
 
163.11

171.95

(5.1
)%
Hampton Inn
 
3
 
78.7
%
78.6
%
0.2
 %
 
144.36

146.80

(1.7
)%
 
113.66

115.32

(1.4
)%
Homewood Suites
 
2
 
85.4
%
84.9
%
0.6
 %
 
202.64

203.33

(0.3
)%
 
173.01

172.55

0.3
 %
Hyatt
 
2
 
78.6
%
80.6
%
(2.6
)%
 
203.08

196.85

3.2
 %
 
159.52

158.71

0.5
 %
Hilton
 
1
 
78.0
%
80.5
%
(3.1
)%
 
185.32

191.72

(3.3
)%
 
144.54

154.36

(6.4
)%
Other
 
4
 
80.6
%
77.9
%
3.6
 %
 
259.14

257.25

0.7
 %
 
208.96

200.32

4.3
 %
Total
 
127
 
82.4
%
82.1
%
0.3
 %
 
$
182.44

$
181.77

0.4
 %
 
$
150.25

$
149.19

0.7
 %
Note: Results reflect the Company's 127 hotel portfolio as of June 30, 2019, that excludes Portfolio 21 and Kingston Plantation sold in June 2019, but includes Portfolio 18 under contract to be sold. Results reflect 100% of the financial results of three consolidated joint ventures and exclude the Chateau LeMoyne-French Quarter New Orleans, which is an unconsolidated hotel. Unaudited information presented only for comparison purposes.

17

https://cdn.kscope.io/9a8ce89e3d67901c57d377ad4611a06c-image0a25.jpg

RLJ Lodging Trust
Pro forma Operating Statistics
(unaudited)

For the six months ended June 30, 2019 and 2018
Top Markets
 
# of Hotels
 
Occupancy
 
ADR
 
RevPAR
2019
2018
Var
2019
2018
Var
2019
2018
Var
Northern California
 
12
 
84.9
%
82.1
%
3.4
 %
 
$
243.20

$
226.60

7.3
 %
 
$
206.39

$
185.95

11.0
 %
Southern California
 
9
 
82.6
%
85.2
%
(3.1
)%
 
177.72

177.39

0.2
 %
 
146.79

151.22

(2.9
)%
South Florida
 
8
 
86.7
%
89.2
%
(2.8
)%
 
200.33

201.66

(0.7
)%
 
173.63

179.79

(3.4
)%
Austin
 
13
 
79.2
%
78.1
%
1.5
 %
 
173.18

173.52

(0.2
)%
 
137.21

135.44

1.3
 %
New York City
 
5
 
87.1
%
87.7
%
(0.6
)%
 
215.86

214.50

0.6
 %
 
188.12

188.04

0.0
 %
Washington, DC
 
6
 
79.3
%
82.1
%
(3.4
)%
 
208.90

207.18

0.8
 %
 
165.56

170.01

(2.6
)%
Houston
 
11
 
72.2
%
73.8
%
(2.2
)%
 
140.05

144.15

(2.8
)%
 
101.07

106.32

(4.9
)%
Chicago
 
13
 
71.4
%
68.4
%
4.4
 %
 
136.22

140.06

(2.7
)%
 
97.21

95.78

1.5
 %
Louisville
 
5
 
68.6
%
62.9
%
9.1
 %
 
167.70

162.38

3.3
 %
 
115.10

102.15

12.7
 %
Denver
 
9
 
71.6
%
73.8
%
(3.0
)%
 
135.75

138.11

(1.7
)%
 
97.13

101.86

(4.6
)%
Other
 
36
 
77.6
%
77.9
%
(0.4
)%
 
170.04

167.90

1.3
 %
 
132.01

130.82

0.9
 %
Total
 
127
 
78.8
%
78.9
%
(0.1
)%
 
$
181.05

$
178.79

1.3
 %
 
$
142.68

$
140.98

1.2
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Service Level
 
# of Hotels
 
Occupancy
 
ADR
 
RevPAR
2019
2018
Var
2019
2018
Var
2019
2018
Var
Focused-Service
 
81
 
76.7
%
77.5
%
(1.0
)%
 
$
167.06

$
166.17

0.5
 %
 
$
128.20

$
128.82

(0.5
)%
Compact Full-Service
 
45
 
81.2
%
81.2
%
0.0
 %
 
192.98

189.74

1.7
 %
 
156.77

154.13

1.7
 %
Full-Service
 
1
 
69.6
%
56.2
%
23.9
 %
 
199.05

196.81

1.1
 %
 
138.60

110.60

25.3
 %
Total
 
127
 
78.8
%
78.9
%
(0.1
)%
 
$
181.05

$
178.79

1.3
 %
 
$
142.68

$
140.98

1.2
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Chain Scale
 
# of Hotels
 
Occupancy
 
ADR
 
RevPAR
2019
2018
Var
2019
2018
Var
2019
2018
Var
Upper Upscale
 
35
 
79.3
%
78.7
%
0.7
 %
 
$
192.68

$
188.34

2.3
 %
 
$
152.81

$
148.29

3.0
 %
Upscale
 
80
 
78.8
%
79.4
%
(0.8
)%
 
172.43

171.59

0.5
 %
 
135.80

136.27

(0.3
)%
Upper Midscale
 
10
 
76.3
%
74.4
%
2.5
 %
 
157.48

158.99

(1.0
)%
 
120.13

118.33

1.5
 %
Other
 
2
 
77.3
%
76.1
%
1.6
 %
 
278.85

268.06

4.0
 %
 
215.57

204.04

5.7
 %
Total
 
127
 
78.8
%
78.9
%
(0.1