Document


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): November 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 November 7, 2019, RLJ Lodging Trust (the “Company”) issued a press release announcing its financial results for the quarter ended September 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: November 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 Third Quarter 2019 Results

- Completed sale of 19 non-core hotels
- Repurchased 4.0 million common shares for approximately $68 million year-to-date
- Executed Wyndham termination agreement


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

Highlights
Pro forma RevPAR decreased slightly by 0.3%, driven by a decline of 0.8% in ADR, partially offset by a 0.5% increase in Occupancy
Completed previously announced sale of 18 non-core hotels and sold one additional hotel
Repurchased approximately 2.8 million common shares for approximately $47.2 million during the third quarter
Executed final agreement to terminate Wyndham management and NOI guarantee agreements

“We had another successful quarter, coming on the heels of the recent achievement of several significant milestones in our portfolio evolution,” commented Leslie D. Hale, President and Chief Executive Officer. “We continued to build on this momentum by generating solid operating results in a slowing environment and executing on a number of fronts. Despite choppy fundamentals and impact from Hurricane Dorian, which affected South Florida and Charleston, we achieved operating results generally in-line with our expectations. With a fortress balance sheet and over $1 billion of investment capacity, RLJ is well positioned 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 for the third quarter declined 0.3%. Pro forma RevPAR was negatively impacted by approximately 40 basis points from Hurricane Dorian. The Company's top performing markets were Louisville and Austin with Pro forma RevPAR growth of 43.3% and 11.1%, respectively.

Net Income for the third quarter was $32.5 million, a decrease of $42.2 million from the comparable period in 2018. For the three months ended September 30, 2019 and September 30, 2018, net income included $1.0 million and $47.7 million respectively, from sold hotels. Net income for the three months ended September 30, 2018, included a gain on sale of hotel properties of $35.9 million.

Adjusted EBITDA for the third quarter was $106.3 million, a decrease of $26.4 million from the comparable period in 2018. Adjusted EBITDA was impacted by approximately $2.0 million from Hurricane Dorian, and reduced by approximately $1.0 million from the earlier than expected closing of 18

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hotels, and by approximately $0.1 million from the sale of Residence Inn Columbia. For the three months ended September 30, 2019 and September 30, 2018, Adjusted EBITDA included $2.1 million and $26.0 million respectively, from sold hotels.

Financial and Operating Highlights

($ in thousands, except ADR, RevPAR, and per share amounts)
(unaudited)
 
For the three months ended September 30,
 
For the nine months ended
September 30,
 
2019
2018
 
Change
 
2019
2018
 
Change
Operational Overview: (1)
 
 
 
 
 
 
 
 
 
Pro forma ADR
$176.93
$178.29
 
(0.8
)%
 
$182.94
$181.68
 
0.7
 %
Pro forma Occupancy
80.8
%
80.4
%
 
0.5
 %
 
80.0
%
79.7
%
 
0.4
 %
Pro forma RevPAR
$143.05
$143.42
 
(0.3
)%
 
$146.39
$144.78
 
1.1
 %
 
 
 
 
 
 
 
 
 
 
Financial Overview:
 
 
 
 
 
 
 
 
 
Total Revenues
$371,124
$447,042
 
(17.0
)%
 
$1,219,118
$1,361,327
 
(10.4
)%
Pro forma Hotel Revenue
$361,437
$359,167
 
0.6
 %
 
$1,097,647
$1,078,874
 
1.7
 %
 
 
 
 
 
 
 
 
 
 
Net Income (2)
$32,455
$74,657
 
(56.5
)%
 
$94,468
$162,943
 
(42.0
)%
 
 
 
 
 
 
 
 
 
 
Pro forma Hotel EBITDA
$113,620
$115,057
 
(1.2
)%
 
$354,786
$351,965
 
0.8
 %
Pro forma Hotel EBITDA Margin
31.4
%
32.0
%
 
(60) bps

 
32.3
%
32.6
%
 
(30) bps

Adjusted EBITDA (3)
$106,305
$132,672
 
(19.9
)%
 
$366,236
$408,302
 
(10.3
)%
 
 
 
 
 
 
 
 
 
 
Adjusted FFO
$79,184
$101,387
 
(21.9
)%
 
$281,015
$310,799
 
(9.6
)%
Adjusted FFO Per Diluted Common Share and Unit
$0.46
$0.58
 
(20.7
)%
 
$1.63
$1.77
 
(7.9
)%

Note:
(1) Pro forma statistics reflect the Company's 108 hotel portfolio as of September 30, 2019.
(2) Net income for the three months ended September 30, 2019 and 2018, included $1.0 million and $47.7 million respectively, from sold hotels. Net Income for the nine months ended September 30, 2019 and 2018, included ($6.1) million and $70.6 million respectively, from sold hotels.
(3) Adjusted EBITDA for the three months ended September 30, 2019 and 2018, included $2.1 million and $26.0 million respectively, from sold hotels. Adjusted EBITDA for the nine months ended September 30, 2019 and 2018, included $39.0 million and $82.7 million respectively, from sold hotels.

Prior Quarterly Outlook Bridge
The following table reconciles the Company's results for the third quarter with the outlook issued as of August 7, 2019, which previously excluded Pro forma Consolidated Hotel EBITDA from the 18 non-core hotels sold during the third quarter.

 
Outlook as of
August 7, 2019
 
 
 
Adjusted Outlook
 
 
 
 
Impact of Disposition(1)
 
 
Actual
Pro forma Consolidated Hotel EBITDA
$109.8M to $114.5M
 
($0.3M)
 
$109.5M to $114.2M
 
$113.6M

Note:
(1) Represents loss of EBITDA from sale of Residence Inn Columbia

The Company's Pro forma Consolidated Hotel EBITDA outlook was impacted by approximately $2.0 million due to Hurricane Dorian and reduced by approximately $0.3 million from the sale of Residence Inn Columbia during the third quarter.

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Dispositions
The Company closed on the previously announced sale of 18 non-core hotels on August 14, 2019. Separately, the Company also sold the 108-room Residence Inn Columbia in Columbia, MD on September 12, 2019 for approximately $12.7 million.

Share Repurchases
During the third quarter, the Company repurchased 2.8 million shares of its common shares for $47.2 million at an average price per share of $16.94. Year-to-date as of November 7, 2019, the Company repurchased approximately 4.0 million shares of its common shares for approximately $68.0 million at an average price per share of $17.08. As of November 7, 2019, the Company's share buyback program has a remaining capacity of approximately $192 million.

Balance Sheet
As of September 30, 2019, the Company had $845.9 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 September 30, 2019, was 3.2x.

Dividends
The Company’s Board of Trustees declared a cash dividend of $0.33 per common share of beneficial interest in the third quarter. The dividend was paid on October 15, 2019, to shareholders of record as of September 30, 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 October 31, 2019, to shareholders of record as of September 30, 2019.

Outlook
The Company's full-year outlook includes all hotels owned as of November 7, 2019. Potential 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.

For the full year 2019, the Company is updating its outlook to incorporate actual third quarter operating results and the sale of Residence Inn Columbia.
 
Prior Outlook as of
August 8, 2019
 
 
 
 
 
Outlook as of
November 7, 2019
 
 
Impact of Dispositions
 
Adjusted Outlook
 
Pro forma RevPAR growth
0.0% to +2.0%
 
-
 
0.0% to +2.0%
 
0.0% to +1.0%
Pro forma Hotel EBITDA Margin
31.6% to 32.2%
 
-
 
31.6% to 32.2%
 
31.6% to 32.2%
Pro forma Consolidated Hotel EBITDA
$449.0M to $474.0M
 
($1.2M)
 
$447.8M to $472.8M
 
$448.0M to $460.0M
Corporate Cash General & Administrative
$35.0M to $36.0M
 
-
 
$35.0M to $36.0M
 
$35.0M to $36.0M
Adjusted EBITDA
$455.0M to $480.0M
 
($1.5M)
 
$453.5M to $478.5M
 
$453.5M to $460.5M
Adjusted FFO per Diluted Share and Unit
$1.98 to $2.10
 
($0.01)
 
$1.97 to $2.09
 
$1.98 to $2.04




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

Net interest expense of $85 million to $87 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 172.2 million, assuming no additional share repurchases

Earnings Call
The Company will conduct its quarterly analyst and investor conference call on November 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 third 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. The Company's portfolio consists of 108 hotels with approximately 23,170 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

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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. 

###
 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, non-cash income taxes, and unrealized gains and loss related to interest rate hedges
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 nine months ended September 30, 2019 and 2018, respectively, no hotels were acquired.

Pro forma adjustments: Sold hotels
For the three and nine months ended September 30, 2019 and 2018, pro forma adjustments included the following sold hotels:


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Courtyard Austin Airport
Courtyard Austin Northwest Arboretum
Courtyard Boulder Longmont
Courtyard Boulder Louisville
Courtyard Denver West Golden
Courtyard Fort Lauderdale SW Miramar
Courtyard Louisville Northeast
Courtyard Salt Lake City Airport
Courtyard South Bend Mishawaka
DoubleTree by Hilton Burlington Vermont
DoubleTree Columbia
Embassy Suites Boston - Marlborough
Embassy Suites Myrtle Beach Oceanfront Resort
Embassy Suites Napa Valley
Fairfield Inn & Suites San Antonio Downtown Market
Hampton Inn Fort Walton Beach
Hampton Inn Houston Near The Galleria
Hampton Inn West Palm Beach Airport Central
Hampton Inn & Suites Clearwater St. Petersburg Ulmerton Road
Hampton Inn & Suites Denver Tech Center
Hilton Garden Inn Bloomington
Hilton Garden Inn Durham Raleigh Research Triangle Park
Hilton Garden Inn West Palm Beach Airport
Hilton Myrtle Beach Resort
Holiday Inn San Francisco - Fisherman's Wharf
Hyatt House Austin Arboretum
Hyatt House Dallas Lincoln Park
Hyatt House Dallas Uptown
Hyatt House Houston Galleria
Residence Inn Austin North Parmer Lane
Residence Inn Austin Northwest Arboretum
Residence Inn Boulder Louisville
Residence Inn Chicago Oak Brook
Residence Inn Columbia
Residence Inn Denver West Golden
Residence Inn Detroit Novi
Residence Inn Fort Lauderdale Plantation
Residence Inn Fort Lauderdale SW Miramar
Residence Inn Longmont Boulder
Residence Inn Louisville Northeast
Residence Inn Salt Lake City Airport
Residence Inn San Antonio Downtown Market Square
Residence Inn Silver Spring
Sheraton Philadelphia Society Hill Hotel
SpringHill Suites Austin North Parmer Lane
SpringHill Suites Boulder Longmont
SpringHill Suites Louisville Hurstbourne North
SpringHill Suites South Bend Mishawaka
The Vinoy Renaissance St. Petersburg Resort & Golf Club


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

 
 

Investment in hotel properties, net
$
4,677,019

 
$
5,378,651

Investment in unconsolidated joint ventures
16,234

 
22,279

Cash and cash equivalents
845,882

 
320,147

Restricted cash reserves
48,610

 
64,695

Hotel and other receivables, net of allowance of $271 and $598, respectively
54,058

 
52,115

Lease right-of-use assets
145,695

 

Deferred income tax asset, net
44,445

 
47,395

Intangible assets, net

 
52,448

Prepaid expense and other assets
43,702

 
67,367

Total assets
$
5,875,645

 
$
6,005,097

Liabilities and Equity
 

 
 

Debt, net
$
2,199,301

 
$
2,202,676

Accounts payable and other liabilities
193,008

 
203,833

Deferred income tax liability
2,766

 
2,766

Advance deposits and deferred revenue
24,655

 
25,411

Lease liabilities
121,783

 

Accrued interest
13,706

 
7,913

Distributions payable
64,215

 
65,557

Total liabilities
2,619,434

 
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 September 30, 2019 and December 31, 2018
366,936

 
366,936

Common shares of beneficial interest, $0.01 par value, 450,000,000 shares authorized; 170,632,364 and 174,019,616 shares issued and outstanding at September 30, 2019 and December 31, 2018, respectively
1,706

 
1,740

Additional paid-in capital
3,137,736

 
3,195,381

Accumulated other comprehensive (loss) income
(27,515
)
 
16,195

Distributions in excess of net earnings
(246,914
)
 
(150,476
)
Total shareholders’ equity
3,231,949

 
3,429,776

Noncontrolling interest:
 

 
 

Noncontrolling interest in consolidated joint ventures
13,994

 
11,908

Noncontrolling interest in the Operating Partnership
10,268

 
10,827

Total noncontrolling interest
24,262

 
22,735

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

 
44,430

Total equity
3,256,211

 
3,496,941

Total liabilities and equity
$
5,875,645

 
$
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 September 30,
 
For the nine months ended September 30,
 
2019
 
2018
 
2019
 
2018
Revenues
 

 
 

 
 
 
 
Operating revenues
 

 
 

 
 
 
 
Room revenue
$
314,195

 
$
377,237

 
$
1,030,722

 
$
1,138,115

Food and beverage revenue
39,447

 
47,211

 
133,151

 
157,850

Other revenue
17,482

 
22,594

 
55,245

 
65,362

Total revenues
371,124

 
447,042

 
1,219,118

 
1,361,327

Expenses
 

 
 

 
 
 
 
Operating expenses
 

 
 

 
 
 
 
Room expense
80,650

 
95,161

 
253,736

 
279,589

Food and beverage expense
31,425

 
37,780

 
101,544

 
121,450

Management and franchise fee expense
26,432

 
34,838

 
96,376

 
107,766

Other operating expense
90,048

 
105,646

 
288,761

 
320,325

Total property operating expenses
228,555

 
273,425

 
740,417

 
829,130

Depreciation and amortization
49,295

 
60,373

 
162,654

 
183,429

Property tax, insurance and other
28,798

 
34,382

 
90,595

 
104,418

General and administrative
11,262

 
11,622

 
34,187

 
38,059

Transaction costs
(211
)
 
261

 
773

 
2,181

Total operating expenses
317,699

 
380,063

 
1,028,626

 
1,157,217

Other income
315

 
856

 
939

 
2,514

Interest income
2,691

 
1,149

 
4,935

 
3,339

Interest expense
(23,333
)
 
(24,629
)
 
(68,632
)
 
(78,772
)
(Loss) gain on sale of hotel properties, net
(1,037
)
 
35,895

 
(25,872
)
 
32,957

(Loss) gain on extinguishment of indebtedness, net

 
(1,656
)
 

 
6,010

Income before equity in (loss) income from unconsolidated joint ventures
32,061

 
78,594

 
101,862

 
170,158

Equity in (loss) income from unconsolidated joint ventures
(135
)
 
219

 
(2,919
)
 
637

Income before income tax expense
31,926

 
78,813

 
98,943

 
170,795

Income tax benefit (expense)
529

 
(4,156
)
 
(4,475
)
 
(7,852
)
Net income
32,455

 
74,657

 
94,468

 
162,943

Net loss (income) attributable to noncontrolling interests:
 

 
 

 
 
 
 
Noncontrolling interest in consolidated joint ventures
104

 
(9
)
 
360

 
170

Noncontrolling interest in the Operating Partnership
(96
)
 
(299
)
 
(329
)
 
(626
)
Preferred distributions - consolidated joint venture

 
(374
)
 
(186
)
 
(1,109
)
Redemption of preferred equity - consolidated joint venture

 

 
(1,153
)
 

Net income attributable to RLJ
32,463

 
73,975

 
93,160

 
161,378

Preferred dividends
(6,279
)
 
(6,279
)
 
(18,836
)
 
(18,836
)
Net income attributable to common shareholders
$
26,184

 
$
67,696

 
$
74,324

 
$
142,542

Basic per common share data:
 
 
 
 
 
 
 
Net income per share attributable to common shareholders
$
0.15

 
$
0.39

 
$
0.43

 
$
0.81

Weighted-average number of common shares
170,495,699

 
174,326,198

 
171,976,429

 
174,253,393

Diluted per common share data:
 
 
 
 
 
 
 
Net income per share attributable to common shareholders
$
0.15

 
$
0.39

 
$
0.43

 
$
0.81

Weighted-average number of common shares
170,600,787

 
174,479,341

 
172,066,473

 
174,365,101

 

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.

10

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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 September 30,
 
For the nine months ended September 30,
 
2019
 
2018
 
2019
 
2018
Net income
$
32,455

 
$
74,657

 
$
94,468

 
$
162,943

Preferred dividends
(6,279
)
 
(6,279
)
 
(18,836
)
 
(18,836
)
Preferred distributions - consolidated joint venture

 
(374
)
 
(186
)
 
(1,109
)
Redemption of preferred equity - consolidated joint venture

 

 
(1,153
)
 

Depreciation and amortization
49,295

 
60,373

 
162,654

 
183,429

Loss (gain) on sale of hotel properties, net
1,037

 
(35,895
)
 
25,872

 
(32,957
)
Noncontrolling interest in consolidated joint ventures
104

 
(9
)
 
360

 
170

Adjustments related to consolidated joint ventures (1)
(75
)
 
(78
)
 
(224
)
 
(233
)
Adjustments related to unconsolidated joint ventures (2)
504

 
661

 
4,733

 
1,998

FFO
77,041

 
93,056

 
267,688

 
295,405

Transaction costs
(211
)
 
261

 
773

 
2,181

Loss (gain) on extinguishment of indebtedness, net

 
1,656

 

 
(6,010
)
Amortization of share-based compensation
2,948

 
4,036

 
8,708

 
9,722

Non-cash income tax (benefit) expense
(1,102
)
 
3,217

 
2,950

 
6,171

Other expenses (income) (3)
508

 
(839
)
 
896

 
3,330

Adjusted FFO
$
79,184

 
$
101,387

 
$
281,015

 
$
310,799

 
 
 
 
 
 
 
 
Adjusted FFO per common share and unit-basic
$
0.46

 
$
0.58

 
$
1.63

 
$
1.78

Adjusted FFO per common share and unit-diluted
$
0.46

 
$
0.58

 
$
1.63

 
$
1.77

 
 
 
 
 
 
 
 
Basic weighted-average common shares and units outstanding (4)
171,268

 
175,100

 
172,749

 
175,027

Diluted weighted-average common shares and units outstanding (4)
171,374

 
175,253

 
172,839

 
175,139


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 interest rate hedges.
(4)  Includes 0.8 million weighted-average operating partnership units for the three and nine month periods ended September 30, 2019 and 2018, respectively.














11

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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 September 30,
 
For the nine months ended September 30,
 
2019
 
2018
 
2019
 
2018
Net income
$
32,455

 
$
74,657

 
$
94,468

 
$
162,943

Depreciation and amortization
49,295

 
60,373

 
162,654

 
183,429

Interest expense, net of interest income
20,642

 
23,479

 
63,697

 
75,433

Income tax (benefit) expense
(529
)
 
4,156

 
4,475

 
7,852

Adjustments related to unconsolidated joint ventures (1)
628

 
788

 
2,182

 
2,379

EBITDA
102,491

 
163,453

 
327,476

 
432,036

Loss (gain) on sale of hotel properties, net
1,037

 
(35,895
)
 
25,872

 
(32,957
)
Loss on sale of unconsolidated joint ventures (2)

 

 
2,923

 

EBITDAre
103,528

 
127,558

 
356,271

 
399,079

Transaction costs
(211
)
 
261

 
773

 
2,181

Loss (gain) on extinguishment of indebtedness, net

 
1,656

 

 
(6,010
)
Amortization of share-based compensation
2,948

 
4,036

 
8,708

 
9,722

Other expenses (income) (3)
40

 
(839
)
 
484

 
3,330

Adjusted EBITDA
106,305

 
132,672

 
366,236

 
408,302

General and administrative (4)
8,314

 
7,763

 
25,470

 
25,209

Other corporate adjustments (5)
1,125

 
584

 
2,099

 
1,124

Consolidated Hotel EBITDA
115,744

 
141,019

 
393,805

 
434,635

Pro forma adjustments - income from sold hotels
(2,124
)
 
(25,962
)
 
(39,019
)
 
(82,670
)
Pro forma Consolidated Hotel EBITDA
113,620

 
115,057

 
354,786

 
351,965

Pro forma adjustments - income from non-comparable hotels

 

 

 

Pro forma Hotel EBITDA
$
113,620

 
$
115,057

 
$
354,786

 
$
351,965


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.



12

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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 September 30,
 
For the nine months ended September 30,
 
2019
 
2018
 
2019
 
2018
Total revenue
$
371,124

 
$
447,042

 
$
1,219,118

 
$
1,361,327

Pro forma adjustments - revenue from sold hotels
(9,732
)
 
(86,206
)
 
(120,148
)
 
(279,158
)
Other corporate adjustments / non-hotel revenue
45

 
(1,669
)
 
(1,323
)
 
(3,295
)
Pro forma Hotel Revenue
$
361,437

 
$
359,167

 
$
1,097,647

 
$
1,078,874

 
 
 
 
 
 
 
 
Pro forma Hotel EBITDA
$
113,620

 
$
115,057

 
$
354,786

 
$
351,965

 
 
 
 
 
 
 
 
Pro forma Hotel EBITDA Margin
31.4
%
 
32.0
%
 
32.3
%
 
32.6
%










13

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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
September 30, 2019 (2)
Secured Debt
 
 
 
 
 
 
Mortgage loan - 1 hotel
10
Jun 2022
Fixed
5.25
%
 
$
30,926

Mortgage loan - 2 hotels
10
Oct 2022
Fixed
4.95
%
 
56,144

Mortgage loan - 1 hotel
10
Oct 2022
Fixed
4.95
%
 
32,271

Mortgage loan - 1 hotel
10
Oct 2022
Fixed
4.94
%
 
28,508

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

Mortgage loan - 3 hotels
5
Apr 2026
Floating (3)
2.88
%
 
96,000

Mortgage loan - 4 hotels
5
Apr 2026
Floating (3)
3.38
%
 
85,000

Weighted-Average / Secured Total
 
 
 
3.73
%
 
$
528,849

 
 
 
 
 
 
 
Unsecured Debt
 
 
 
 
 
 
Revolver (4)
4
Apr 2021
Floating
3.52
%
 
$

$400 Million Term Loan Maturing 2021
5
Apr 2021
Floating (3)(5)
2.97
%
 
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
 
 
 
4.16
%
 
$
1,650,000

 
 
 
 
 
 
 
Weighted-Average / Gross Debt
 
 
 
4.05
%
 
$
2,178,849


Note:
(1) Interest rates as of September 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 September 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 $399.0 million on the $400.0 million term loan.





14

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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
Marriott Louisville Downtown
Louisville, KY
620
$15,166
The Knickerbocker New York
New York, NY
330
13,405
Wyndham San Diego Bayside
San Diego, CA
600
11,279
San Francisco Marriott Union Square
San Francisco, CA
401
10,911
Wyndham Boston Beacon Hill
Boston, MA
304
9,740
Courtyard Austin Downtown Convention Center
Austin, TX
270
9,395
The Mills House Wyndham Grand Hotel
Charleston, SC
216
9,361
Embassy Suites San Francisco Airport - Waterfront
Burlingame, CA
340
8,839
Embassy Suites San Francisco Airport - South San Francisco
South San Francisco, CA
312
8,257
Embassy Suites Los Angeles - International Airport South
El Segundo, CA
349
8,153
Wyndham New Orleans - French Quarter
New Orleans, LA
374
8,056
DoubleTree Grand Key Resort
Key West, FL
216
7,782
Embassy Suites Fort Lauderdale 17th Street
Fort Lauderdale, FL
361
7,644
Embassy Suites Mandalay Beach - Hotel & Resort
Oxnard, CA
250
7,439
Courtyard San Francisco
San Francisco, CA
166
7,253
Courtyard Portland City Center
Portland, OR
256
7,205
Residence Inn Palo Alto Los Altos
Los Altos, CA
156
6,918
Wyndham Philadelphia Historic District
Philadelphia, PA
364
6,909
Courtyard Waikiki Beach
Honolulu, HI
403
6,621
Hilton Garden Inn San Francisco Oakland Bay Brg
Emeryville, CA
278
6,564
Renaissance Pittsburgh Hotel
Pittsburgh, PA
300
6,517
Hyatt House Emeryville San Francisco Bay Area
Emeryville, CA
234
6,373
Embassy Suites Deerfield Beach - Resort & Spa
Deerfield Beach, FL
244
6,211
Embassy Suites Tampa Downtown Convention Center
Tampa, FL
360
6,185
Fairfield Inn & Suites Washington DC Downtown
Washington, DC
198
6,035
DoubleTree Metropolitan Hotel New York City
New York, NY
764
5,931
Wyndham Santa Monica At The Pier
Santa Monica, CA
132
5,914
Hyatt House Santa Clara
Santa Clara, CA
150
5,780
Hyatt House San Jose Silicon Valley
San Jose, CA
164
5,647
DoubleTree Suites by Hilton Austin
Austin, TX
188
5,602
Embassy Suites Atlanta - Buckhead
Atlanta, GA
316
5,494
Courtyard Charleston Historic District
Charleston, SC
176
5,430
Wyndham Houston - Medical Center Hotel & Suites
Houston, TX
287
5,365
Embassy Suites Milpitas Silicon Valley
Milpitas, CA
266
5,259
Courtyard Chicago Downtown Magnificent Mile
Chicago, IL
306
5,070
Residence Inn Bethesda Downtown
Bethesda, MD
188
4,987
Marriott Denver South @ Park Meadows
Lone Tree, CO
279
4,877
Embassy Suites Boston Waltham
Waltham, MA
275
4,829
Hyatt House San Diego Sorrento Mesa
San Diego, CA
193
4,695
Residence Inn Austin Downtown Convention Center
Austin, TX
179
4,592
Homewood Suites Washington DC Downtown
Washington, DC
175
4,544
Embassy Suites Irvine Orange County
Irvine, CA
293
4,493
Hyatt Centric Midtown Atlanta
Atlanta, GA
194
4,444
Renaissance Fort Lauderdale Plantation Hotel
Plantation, FL
250
4,297
Hilton Cabana Miami Beach
Miami Beach, FL
231
4,186
Embassy Suites Orlando - International Drive South/Convention Center
Orlando, FL
244
4,154
Embassy Suites Dallas - Love Field
Dallas, TX
248
4,148
Hilton Garden Inn New Orleans Convention Center
New Orleans, LA
286
4,123
Hilton Garden Inn Los Angeles Hollywood
Los Angeles, CA
160
4,111
Hyatt Place Washington DC Downtown K Street
Washington, DC
164
4,026
Embassy Suites Los Angeles Downey
Downey, CA
220
3,885
Embassy Suites Miami - International Airport
Miami, FL
318
3,877
Hyatt House San Ramon
San Ramon, CA
142
3,848
Renaissance Boulder Flatiron Hotel
Broomfield, CO
232
3,787
Embassy Suites Phoenix - Biltmore
Phoenix, AZ
232
3,722
Residence Inn National Harbor Washington DC
Oxon Hill, MD
162
3,717
Marriott Denver Airport @ Gateway Park
Aurora, CO
238
3,707
Embassy Suites Minneapolis - Airport
Bloomington, MN
310
3,540
Wyndham Pittsburgh University Center
Pittsburgh, PA
251
3,442
Hyatt Place Fremont Silicon Valley
Fremont, CA
151
3,350
Top 60 Assets
 
16,266
367,091
Other (48 Assets)
 
6,913
95,578
Total Portfolio
 
23,179
$462,669
Note: For the trailing twelve months ended September 30, 2019. 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.

15

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RLJ Lodging Trust
Pro forma Operating Statistics
(unaudited)

For the three months ended September 30, 2019 and 2018
Top Markets
 
# of Hotels
 
Occupancy
 
ADR
 
RevPAR
2019
2018
Var
2019
2018
Var
2019
2018
Var
Northern California
 
12
 
87.8
%
88.8
%
(1.1
)%
 
$
236.86

$
241.95

(2.1
)%
 
$
207.99

$
214.77

(3.2
)%
Southern California
 
9
 
89.7
%
88.8
%
1.1
 %
 
192.41

192.73

(0.2
)%
 
172.66

171.11

0.9
 %
South Florida
 
8
 
74.9
%
81.0
%
(7.5
)%
 
138.18

137.63

0.4
 %
 
103.52

111.47

(7.1
)%
Austin
 
8
 
72.2
%
68.1
%
6.0
 %
 
164.40

156.96

4.7
 %
 
118.72

106.88

11.1
 %
New York City
 
5
 
93.1
%
92.7
%
0.5
 %
 
230.84

237.67

(2.9
)%
 
214.90

220.26

(2.4
)%
Washington, DC
 
5
 
83.2
%
82.8
%
0.5
 %
 
190.95

185.95

2.7
 %
 
158.80

153.90

3.2
 %
Chicago
 
13
 
80.9
%
78.7
%
2.8
 %
 
146.42

154.50

(5.2
)%
 
118.41

121.60

(2.6
)%
Houston
 
9
 
68.0
%
67.6
%
0.7
 %
 
132.80

137.39

(3.3
)%
 
90.37

92.82

(2.6
)%
Louisville
 
2
 
74.5
%
54.8
%
36.1
 %
 
159.75

151.73

5.3
 %
 
119.09

83.11

43.3
 %
Denver
 
5
 
84.0
%
82.7
%
1.6
 %
 
153.60

151.14

1.6
 %
 
129.08

125.04

3.2
 %
Other
 
32
 
77.9
%
78.7
%
(1.0
)%
 
161.06

161.23

(0.1
)%
 
125.42

126.82

(1.1
)%
Total
 
108
 
80.8
%
80.4
%
0.5
 %
 
$
176.93

$
178.29

(0.8
)%
 
$
143.05

$
143.42

(0.3
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Service Level
 
# of Hotels
 
Occupancy
 
ADR
 
RevPAR
2019
2018
Var
2019
2018
Var
2019
2018
Var
Focused-Service
 
62
 
80.9
%
79.5
%
1.7
 %
 
$
171.89

$
173.99

(1.2
)%
 
$
139.03

$
138.40

0.5
 %
Compact Full-Service
 
45
 
81.2
%
82.6
%
(1.7
)%
 
181.34

182.06

(0.4
)%
 
147.34

150.46

(2.1
)%
Full-Service
 
1
 
72.0
%
49.7
%
45.0
 %
 
166.10

160.23

3.7
 %
 
119.64

79.59

50.3
 %
Total
 
108
 
80.8
%
80.4
%
0.5
 %
 
$
176.93

$
178.29

(0.8
)%
 
$
143.05

$
143.42

(0.3
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Chain Scale
 
# of Hotels
 
Occupancy
 
ADR
 
RevPAR
2019
2018
Var
2019
2018
Var
2019
2018
Var
Upper Upscale
 
35
 
78.2
%
78.6
%
(0.5
)%
 
$
173.94

$
174.39

(0.3
)%
 
$
136.01

$
136.99

(0.7
)%
Upscale
 
62
 
82.7
%
81.7
%
1.2
 %
 
177.28

179.34

(1.1
)%
 
146.58

146.59

(0.0
 ) %
Upper Midscale
 
9
 
80.0
%
80.2
%
(0.2
)%
 
152.89

152.27

0.4
 %
 
122.33

122.10

0.2
 %
Other
 
2
 
88.2
%
85.1
%
3.6
 %
 
277.50

286.75

(3.2
)%
 
244.76

244.02

0.3
 %
Total
 
108
 
80.8
%
80.4
%
0.5
 %
 
$
176.93

$
178.29

(0.8
)%
 
$
143.05

$
143.42

(0.3
)%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Flags
 
# of Hotels
 
Occupancy
 
ADR
 
RevPAR
2019
2018
Var
2019
2018
Var
2019
2018
Var
Embassy Suites
 
21
 
78.9
%
81.6
%
(3.3
)%
 
$
167.25

$
168.52

(0.8
)%
 
$
131.94

$
137.49

(4.0
)%
Courtyard
 
15
 
81.1
%
78.6
%
3.2
 %
 
182.42

184.63

(1.2
)%
 
147.97

145.17

1.9
 %
Residence Inn
 
15
 
78.2
%
77.6
%
0.8
 %
 
159.81

161.37

(1.0
)%
 
124.95

125.15

(0.2
)%
Wyndham
 
8
 
83.2
%
83.7
%
(0.7
)%
 
175.65

173.45

1.3
 %
 
146.07

145.26

0.6
 %
Hyatt House
 
7
 
87.6
%
89.2
%
(1.8
)%
 
205.99

206.09

(0.1
)%
 
180.43

183.83

(1.9
)%
Marriott
 
6
 
79.1
%
70.1
%
12.8
 %
 
193.20

194.67

(0.8
)%
 
152.82

136.49

12.0
 %
Fairfield Inn & Suites
 
6
 
82.5
%
82.2
%
0.4
 %
 
149.39

145.39

2.8
 %
 
123.26

119.44

3.2
 %
Hilton Garden Inn
 
5
 
80.2
%
76.6
%
4.6
 %
 
168.15

175.53

(4.2
)%
 
134.80

134.49

0.2
 %
DoubleTree
 
4
 
90.0
%
89.3
%
0.8
 %
 
191.85

199.72

(3.9
)%
 
172.74

178.38

(3.2
)%
SpringHill Suites
 
4
 
78.8
%
73.4
%
7.4
 %
 
134.39

130.91

2.7
 %
 
105.93

96.08

10.3
 %
Hyatt Place
 
3
 
83.6
%
85.1
%
(1.8
)%
 
182.35

188.85

(3.4
)%
 
152.41

160.77

(5.2
)%
Renaissance
 
3
 
78.7
%
81.4
%
(3.3
)%
 
169.00

167.04

1.2
 %
 
133.04

135.95

(2.1
)%
Hampton Inn
 
2
 
79.5
%
80.0
%
(0.7
)%
 
158.34

163.75

(3.3
)%
 
125.80

131.05

(4.0
)%
Homewood Suites
 
2
 
84.1
%
84.9
%
(1.0
)%
 
179.68

174.95

2.7
 %
 
151.08

148.58

1.7
 %
Hyatt
 
2
 
77.7
%
79.2
%
(1.8
)%
 
183.18

189.81

(3.5
)%
 
142.39

150.31

(5.3
)%
Hilton
 
1
 
59.3
%
75.8
%
(21.7
)%
 
164.55

161.27

2.0
 %
 
97.62

122.23

(20.1
)%
Other
 
4
 
78.7
%
76.6
%
2.7
 %
 
242.24

249.91

(3.1
)%
 
190.63

191.40

(0.4
)%
Total
 
108
 
80.8
%
80.4
%
0.5
 %
 
$
176.93

$
178.29

(0.8
)%
 
$
143.05

$
143.42

(0.3
)%
Note: 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.

16

https://cdn.kscope.io/21ca9e699c446bc66dc9f845be1d7f2c-image0a29.jpg

RLJ Lodging Trust
Pro forma Operating Statistics
(unaudited)

For the nine months ended September 30, 2019 and 2018
Top Markets
 
# of Hotels
 
Occupancy
 
ADR
 
RevPAR
2019
2018
Var
2019
2018
Var
2019
2018
Var
Northern California
 
12
 
85.9
%
84.3
%
1.8
 %
 
$
241.02

$
232.05

3.9
 %
 
$
206.93

$
195.66

5.8
 %
Southern California
 
9
 
85.0
%
86.4
%
(1.7
)%
 
182.94

182.70

0.1
 %
 
155.51

157.92

(1.5
)%
South Florida
 
8
 
82.7
%
86.4
%
(4.3
)%
 
181.36

181.44

(0.0
 ) %
 
150.00

156.77

(4.3
)%
Austin
 
8
 
77.9
%
74.7
%
4.3
 %
 
182.39

179.56

1.6
 %
 
142.13

134.15

5.9
 %
New York City
 
5
 
89.2
%
89.4
%
(0.2
)%
 
221.13

222.60

(0.7
)%
 
197.14

198.90

(0.9
)%
Washington, DC
 
5
 
81.0
%
82.1
%
(1.2
)%
 
209.27

207.87

0.7
 %
 
169.60

170.57

(0.6
)%
Chicago
 
13
 
74.6
%
71.9
%
3.8
 %
 
139.95

145.39

(3.7
)%
 
104.35

104.48

(0.1
)%
Houston
 
9
 
70.7
%
71.0
%
(0.4
)%
 
141.84

146.30

(3.0
)%
 
100.29

103.86

(3.4
)%
Louisville
 
2
 
72.6
%
58.3
%
24.5
 %
 
178.02

173.87

2.4
 %
 
129.23

101.34

27.5
 %
Denver
 
5
 
75.5
%
76.7
%
(1.7
)%
 
146.92

145.60

0.9
 %
 
110.86

111.71

(0.8
)%
Other
 
32
 
78.2
%
78.6
%
(0.5
)%
 
168.60

167.07

0.9
 %
 
131.81

131.25

0.4
 %
Total
 
108
 
80.0
%
79.7
%
0.4
 %
 
$
182.94

$
181.68

0.7
 %
 
$
146.39

$
144.78

1.1
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Service Level
 
# of Hotels
 
Occupancy
 
ADR
 
RevPAR
2019
2018
Var
2019
2018
Var
2019
2018
Var
Focused-Service
 
62
 
79.1
%
78.7
%
0.5
 %
 
$
174.64

$
174.31

0.2
 %
 
$
138.09

$
137.20

0.7
 %
Compact Full-Service
 
45
 
81.2
%
81.7
%
(0.6
)%
 
189.06

187.12

1.0
 %
 
153.59

152.89

0.5
 %
Full-Service
 
1
 
70.4
%
54.0
%
30.5
 %
 
187.69

185.47

1.2
 %
 
132.21

100.15

32.0
 %
Total
 
108
 
80.0
%
79.7
%
0.4
 %
 
$
182.94

$
181.68

0.7
 %
 
$
146.39

$
144.78

1.1
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Chain Scale
 
# of Hotels
 
Occupancy
 
ADR
 
RevPAR
2019
2018
Var
2019
2018
Var
2019
2018
Var
Upper Upscale
 
35
 
78.9
%
78.7
%
0.3
 %
 
$
186.43

$
183.64

1.5
 %
 
$
147.15

$
144.48

1.8
 %
Upscale
 
62
 
81.0
%
80.8
%
0.2
 %
 
178.92

178.73

0.1
 %
 
144.90

144.42

0.3
 %
Upper Midscale
 
9
 
78.3
%
76.2
%
2.8
 %
 
159.24

160.14

(0.6
)%
 
124.65

121.98

2.2
 %
Other
 
2
 
81.0
%
79.1
%
2.3
 %
 
278.36

274.83

1.3
 %
 
225.41

217.51

3.6
 %
Total
 
108
 
80.0
%
79.7
%
0.4
 %
 
$
182.94

$
181.68

0.7
 %
 
$
146.39

$
144.78

1.1
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Flags
 
# of Hotels
 
Occupancy
 
ADR
 
RevPAR
2019
2018
Var
2019
2018
Var
2019
2018
Var
Embassy Suites
 
21
 
80.6
%
81.7
%
(1.4
)%
 
$
179.94

$
178.17

1.0
 %
 
$
145.00

$
145.60

(0.4
)%
Courtyard
 
15
 
80.3
%
79.2
%
1.4
 %
 
180.81

180.51

0.2
 %
 
145.19

143.00

1.5
 %
Residence Inn
 
15
 
77.2
%
77.7
%
(0.6
)%
 
166.80

167.42

(0.4
)%
 
128.80

130.02

(0.9
)%
Wyndham
 
8
 
81.0
%
80.5
%
0.6
 %
 
173.82

173.80

0.0
 %
 
140.81

139.93

0.6
 %
Hyatt House
 
7
 
85.4
%
87.2
%
(2.1
)%
 
205.96

200.60

2.7
 %
 
175.89

174.92

0.6
 %
Marriott
 
6
 
75.9
%
69.4
%
9.3
 %
 
204.48

197.97

3.3
 %
 
155.21

137.48

12.9
 %
Fairfield Inn & Suites
 
6
 
81.3
%
79.1
%
2.7
 %
 
163.39

162.85

0.3
 %
 
132.77

128.86

3.0
 %
Hilton Garden Inn
 
5
 
77.5
%
77.2
%
0.4
 %
 
170.51

171.49

(0.6
)%
 
132.23

132.41

(0.1
)%
DoubleTree
 
4
 
90.9
%
90.2
%
0.8
 %
 
200.41

203.64

(1.6
)%
 
182.20

183.64

(0.8
)%
SpringHill Suites
 
4
 
74.4
%
72.0
%
3.3
 %
 
137.75

135.25

1.9
 %
 
102.42

97.35

5.2
 %
Hyatt Place
 
3
 
77.9
%
81.8
%
(4.8
)%
 
188.55

187.89

0.4
 %
 
146.83

153.64

(4.4
)%
Renaissance
 
3
 
75.8
%
78.7
%
(3.7
)%
 
170.88

169.42

0.9
 %
 
129.46

133.28

(2.9
)%
Hampton Inn
 
2
 
77.1
%
75.7
%
1.9
 %
 
150.78

153.75

(1.9
)%
 
116.29

116.34

0.0
 %
Homewood Suites
 
2
 
80.9
%
79.0
%
2.5
 %
 
182.71

181.53

0.7
 %
 
147.85

143.36

3.1
 %
Hyatt
 
2
 
79.2
%
80.5
%
(1.6
)%
 
205.63

195.70

5.1
 %
 
162.95

157.58

3.4
 %
Hilton
 
1
 
74.1
%
83.2
%
(10.9
)%
 
199.93

205.10

(2.5
)%
 
148.17

170.55

(13.1
)%
Other
 
4
 
75.5
%
73.4
%
2.8
 %
 
241.73

241.42

0.1
 %
 
182.40

177.21

2.9
 %
Total
 
108
 
80.0
%
79.7
%
0.4
 %
 
$
182.94

$
181.68

0.7
 %
 
$
146.39

$
144.78

1.1
 %
Note: 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