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
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification Number) | ||
(Address of principal executive offices) | (Zip Code) | ||
(301 ) 280-7777
(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):
Securities registered pursuant to Section 12 (b) of the Exchange Act:
Title of Class | Trading Symbol | Name of Exchange on Which Registered | ||
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:
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
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
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
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
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
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
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
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
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 | )% | $ | 181.05 | $ | 178.79 | 1.3 | % | $ | 142.68 | $ | 140.98 | 1.2 | % | ||||||||
Flags | # of Hotels | Occupancy | ADR | RevPAR | |||||||||||||||||||||||
2019 | 2018 | Var | 2019 | 2018 | Var | 2019 | 2018 | Var | |||||||||||||||||||
Embassy Suites | 21 | 81.4 | % | 81.8 | % | (0.4 | )% | $ | 186.20 | $ | 183.07 | 1.7 | % | $ | 151.64 | $ | 149.72 | 1.3 | % | ||||||||
Residence Inn | 21 | 76.7 | % | 78.1 | % | (1.8 | )% | 160.32 | 161.82 | (0.9 | )% | 122.95 | 126.37 | (2.7 | )% | ||||||||||||
Courtyard | 20 | 77.4 | % | 77.9 | % | (0.6 | )% | 172.78 | 171.48 | 0.8 | % | 133.69 | 133.51 | 0.1 | % | ||||||||||||
Hyatt House | 11 | 82.9 | % | 83.7 | % | (1.0 | )% | 179.54 | 176.10 | 2.0 | % | 148.80 | 147.43 | 0.9 | % | ||||||||||||
Wyndham | 8 | 79.9 | % | 78.9 | % | 1.3 | % | 172.86 | 173.99 | (0.6 | )% | 138.13 | 137.22 | 0.7 | % | ||||||||||||
SpringHill Suites | 7 | 66.2 | % | 69.2 | % | (4.4 | )% | 130.75 | 129.17 | 1.2 | % | 86.53 | 89.43 | (3.2 | )% | ||||||||||||
Marriott | 6 | 74.3 | % | 69.1 | % | 7.5 | % | 210.59 | 199.67 | 5.5 | % | 156.43 | 137.98 | 13.4 | % | ||||||||||||
Fairfield Inn & Suites | 6 | 80.6 | % | 77.6 | % | 3.9 | % | 170.67 | 172.25 | (0.9 | )% | 137.61 | 133.65 | 3.0 | % | ||||||||||||
Hilton Garden Inn | 5 | 76.2 | % | 77.5 | % | (1.7 | )% | 171.77 | 169.46 | 1.4 | % | 130.91 | 131.35 | (0.3 | )% | ||||||||||||
DoubleTree | 4 | 91.4 | % | 90.6 | % | 0.8 | % | 204.70 | 205.61 | (0.4 | )% | 187.01 | 186.31 | 0.4 | % | ||||||||||||
Renaissance | 3 | 74.3 | % | 77.3 | % | (3.9 | )% | 171.89 | 170.70 | 0.7 | % | 127.63 | 131.92 | (3.3 | )% | ||||||||||||
Hyatt Place | 3 | 75.0 | % | 80.1 | % | (6.4 | )% | 192.07 | 187.37 | 2.5 | % | 143.99 | 150.01 | (4.0 | )% | ||||||||||||
Hampton Inn | 3 | 73.5 | % | 74.5 | % | (1.4 | )% | 138.04 | 139.63 | (1.1 | )% | 101.45 | 104.02 | (2.5 | )% | ||||||||||||
Homewood Suites | 2 | 79.3 | % | 75.9 | % | 4.4 | % | 184.35 | 185.27 | (0.5 | )% | 146.21 | 140.70 | 3.9 | % | ||||||||||||
Hyatt | 2 | 80.0 | % | 81.2 | % | (1.5 | )% | 216.72 | 198.61 | 9.1 | % | 173.40 | 161.27 | 7.5 | % | ||||||||||||
Hilton | 1 | 81.6 | % | 86.9 | % | (6.1 | )% | 213.00 | 224.53 | (5.1 | )% | 173.87 | 195.11 | (10.9 | )% | ||||||||||||
Other | 4 | 73.8 | % | 71.8 | % | 2.8 | % | 241.45 | 236.81 | 2.0 | % | 178.21 | 169.99 | 4.8 | % | ||||||||||||
Total | 127 | 78.8 | % | 78.9 | % | (0.1 | )% | $ | 181.05 | $ | 178.79 | 1.3 | % | $ | 142.68 | $ | 140.98 | 1.2 | % | ||||||||
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.
18
RLJ Lodging Trust
Schedule of Hotel Dispositions
Kingston Plantation - Sold June 2019
Hotel | City/State | # of Rooms | ||
Embassy Suites Myrtle Beach Oceanfront Resort | Myrtle Beach, SC | 255 | ||
Hilton Myrtle Beach Resort | Myrtle Beach, SC | 385 | ||
Total | 640 | |||
Portfolio 21 - Sold June 2019
Hotel | City/State | # of Rooms | ||
Courtyard Austin Airport | Austin, TX | 150 | ||
Courtyard Boulder Longmont | Longmont, CO | 78 | ||
Courtyard Fort Lauderdale SW Miramar | Miramar, FL | 128 | ||
Courtyard Salt Lake City Airport | Salt Lake City, UT | 154 | ||
Fairfield Inn & Suites San Antonio Downtown Market | San Antonio, TX | 110 | ||
Hampton Inn Fort Walton Beach | Fort Walton Beach, FL | 100 | ||
Hampton Inn West Palm Beach Airport Central | West Palm Beach, FL | 105 | ||
Hampton Inn & Suites Clearwater St. Petersburg Ulmerton Road | Clearwater, FL | 128 | ||
Hampton Inn & Suites Denver Tech Center | Denver, CO | 123 | ||
Hilton Garden Inn Bloomington | Bloomington, IN | 168 | ||
Hilton Garden Inn Durham Raleigh Research Triangle Park | Durham, NC | 177 | ||
Hilton Garden Inn West Palm Beach Airport | West Palm Beach, FL | 100 | ||
Residence Inn Chicago Oak Brook | Oak Brook, IL | 156 | ||
Residence Inn Detroit Novi | Novi, MI | 107 | ||
Residence Inn Fort Lauderdale Plantation | Plantation, FL | 138 | ||
Residence Inn Fort Lauderdale SW Miramar | Miramar, FL | 130 | ||
Residence Inn Longmont Boulder | Longmont, CO | 84 | ||
Residence Inn Salt Lake City Airport | Salt Lake City, UT | 104 | ||
Residence Inn San Antonio Downtown Market Square | San Antonio, TX | 95 | ||
Residence Inn Silver Spring | Silver Spring, MD | 130 | ||
SpringHill Suites Boulder Longmont | Longmont, CO | 90 | ||
Total | 2,555 | |||
Portfolio 18 - Scheduled to close August 2019
Hotel | City/State | # of Rooms | ||
Courtyard Austin Northwest Arboretum | Austin, TX | 102 | ||
Courtyard Boulder Louisville | Louisville, CO | 154 | ||
Courtyard Denver West Golden | Golden, CO | 110 | ||
Courtyard Louisville Northeast | Louisville, KY | 114 | ||
Courtyard South Bend Mishawaka | Mishawaka, IN | 78 | ||
Hampton Inn Houston Near The Galleria | Houston, TX | 176 | ||
Hyatt House Austin Arboretum | Austin, TX | 131 | ||
Hyatt House Dallas Lincoln Park | Dallas, TX | 155 | ||
Hyatt House Dallas Uptown | Dallas, TX | 141 | ||
Hyatt House Houston Galleria | Houston, TX | 147 | ||
Residence Inn Austin North Parmer Lane | Austin, TX | 88 | ||
Residence Inn Austin Northwest Arboretum | Austin, TX | 84 | ||
Residence Inn Boulder Louisville | Louisville, CO | 88 | ||
Residence Inn Denver West Golden | Golden, CO | 88 | ||
Residence Inn Louisville Northeast | Louisville, KY | 102 | ||
SpringHill Suites Austin North Parmer Lane | Austin, TX | 132 | ||
SpringHill Suites Louisville Hurstbourne North | Louisville, KY | 142 | ||
SpringHill Suites South Bend Mishawaka | Mishawaka, IN | 87 | ||
Total | 2,119 | |||
19