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 6, 2013

 

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, MD

 

20814

(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):

 

o            Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

o            Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

o            Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

o            Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 



 

Item 2.02.      Results of Operations and Financial Condition.

 

On November 6, 2013, RLJ Lodging Trust (the “Company”) issued a press release announcing its financial results for the three and nine months ended September 30, 2013.  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

 

Press release dated November 6, 2013, issued by RLJ Lodging Trust, providing financial results for the three and nine months ended September 30, 2013.

 

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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

 

 

 

 

 

 

Date: November 6, 2013

By:

/s/ Thomas J. Baltimore, Jr.

 

 

Thomas J. Baltimore, Jr.

 

 

President, Chief Executive Officer and Trustee

 

3



 

EXHIBIT LIST

 

Exhibit
Number

 

Description

99.1

 

Press release dated November 6, 2013, issued by RLJ Lodging Trust, providing financial results for the three and nine months ended September 30, 2013.

 

4


 

Exhibit 99.1

 

 

Press Release

 

RLJ Lodging Trust Reports Third Quarter 2013 Results

· Solid 5.4% Pro forma RevPAR growth; 6.4% excluding prior year one-time events

· Completed a comprehensive $565 million refinancing

 

Bethesda, MD, November 6, 2013 — RLJ Lodging Trust (the “Company”) (NYSE: RLJ) today reported results for the three and nine months ended September 30, 2013.

 

Third Quarter Highlights

·                  Pro forma RevPAR increased 5.4%, Pro forma ADR increased 3.6% and Pro forma Occupancy increased 1.8%

·                  Excluding prior year one-time events, Pro forma RevPAR increased 6.4%

·                  Pro forma Consolidated Hotel EBITDA increased 5.2% to $86.5 million

·                  Adjusted FFO increased 28.7% to $65.1 million

·                  Completed a comprehensive $565.0 million refinancing with expected annualized savings of approximately $10.0 million

·                  Declared a cash dividend of $0.205 per share for the quarter

 

“Our well-diversified portfolio continued to show expansion as we achieved broad RevPAR gains across the portfolio despite more challenging comparables and political headwinds,” commented Thomas J. Baltimore, Jr., President and Chief Executive Officer.  “We also made additional enhancements to our fortress balance sheet through a comprehensive $565 million refinancing that reduced our interest expense and further staggered our debt maturities.”

 

Financial and Operating Results

Performance metrics such as Occupancy, Average Daily Rate (“ADR”), Revenue Per Available Room (“RevPAR”), Hotel EBITDA, and Hotel EBITDA Margin are pro forma. The prefix “pro forma” as defined by the Company, denotes operating results which include results for periods prior to its ownership. Pro forma RevPAR and Pro forma Hotel EBITDA Margin are reported on a comparable basis and therefore exclude non-comparable hotels that were not open for operation or closed for renovations for comparable periods. Explanations of EBITDA, Adjusted EBITDA, Hotel EBITDA, FFO, and Adjusted FFO, as well as reconciliations of those measures to net income or loss, if applicable, are included at the end of this release.

 

Pro forma RevPAR for the three months ended September 30, 2013, increased 5.4% over the comparable period in 2012, driven by an increase in Pro forma ADR of 3.6% and an increase in Pro forma Occupancy of 1.8%. Excluding prior year one-time events, such as the Republican National Convention, Pro forma RevPAR increased 6.4%.  Among the Company’s top six markets, the best performers in the quarter were Houston and Austin which experienced RevPAR growth of 19.1% and 12.0%, respectively. For the nine months ended September 30, 2013, Pro forma RevPAR increased 8.2% over the comparable period in 2012, driven by an increase in Pro forma ADR of 5.6% and an increase in Pro forma Occupancy of 2.5%.

 

1



 

Pro forma Hotel EBITDA Margin for the three months ended September 30, 2013, decreased 17 basis points over the comparable period in 2012 to 34.5%.  Excluding the impact of the new ground lease entered into upon acquiring the Courtyard Waikiki Beach, Pro forma Hotel EBITDA Margin increased 20 basis points.  For the nine months ended September 30, 2013, Pro forma Hotel EBITDA Margin increased 82 basis points over the comparable period in 2012 to 34.7%.

 

Pro forma Consolidated Hotel EBITDA includes the results of non-comparable hotels. For the three months ended September 30, 2013, Pro forma Consolidated Hotel EBITDA increased $4.3 million to $86.5 million, representing a 5.2% increase over the comparable period in 2012. For the nine months ended September 30, 2013, Pro forma Consolidated Hotel EBITDA increased $25.6 million to $257.8 million, representing an 11.0% increase over the comparable period in 2012.

 

Adjusted EBITDA for the three months ended September 30, 2013, increased $9.1 million to $80.8 million, representing a 12.7% increase over the comparable period in 2012. For the nine months ended September 30, 2013, Adjusted EBITDA increased $37.1 million to $234.2 million, representing an increase of 18.8% over the comparable period in 2012.

 

Adjusted FFO for the three months ended September 30, 2013, increased $14.5 million to $65.1 million, representing a 28.7% increase over the comparable period in 2012. For the nine months ended September 30, 2013, Adjusted FFO increased $49.0 million to $183.9 million, representing a 36.4% increase over the comparable period in 2012. Adjusted FFO per diluted share and unit for the three and nine months ended September 30, 2013, was $0.53 and $1.55, respectively, based on the Company’s diluted weighted-average common shares and units outstanding of 123.6 million and 118.7 million for each period, respectively.

 

Non-recurring items for the three months ended September 30, 2013, include $1.0 million related to accelerated amortization of deferred financing fees, a gain of $4.8 million related to the acquisition of the Residence Inn Atlanta Midtown/Historic through a foreclosure sale, a gain of $3.3 million related to the extinguishment of indebtedness from the Courtyard Goshen, and $0.1 million of accelerated deferred management fees related to assets disposed.

 

Non-recurring items are included in net income attributable to common shareholders but have been excluded from Adjusted EBITDA and Adjusted FFO, as applicable.  A complete listing is provided in the Non-GAAP reconciliation tables for the three and nine months ended September 30, 2013 and 2012.

 

Net income attributable to common shareholders for the three months ended September 30, 2013, was $36.5 million compared to $15.2 million in the comparable period in 2012. For the nine months ended September 30, 2013, net income attributable to common shareholders was $85.5 million compared to $27.6 million in the comparable period in 2012.

 

Net cash flow from operating activities for the nine months ended September 30, 2013, totaled $185.2 million compared to $123.7 million for the comparable period in 2012.

 

Acquisitions/Dispositions

During the three months ended September 30, 2013, the Company acquired the 78-room Residence Inn Atlanta Midtown/Historic, Georgia. The Company purchased a mortgage loan collateralized by the hotel for approximately $5.0 million in November 2009. After the borrower defaulted on the loan early in 2013, the Company acquired the

 

2



 

asset through a foreclosure sale on August 6, 2013. The hotel was closed subsequent to the acquisition and will undergo a comprehensive renovation that is expected to be completed by the third quarter of 2014. The total investment, including capital expenditures, is expected to represent a forward capitalization rate of approximately 12% based on the hotel’s projected 2015 net operating income.

 

During the quarter, the Company also disposed of one hotel. On August 28, 2013, the Courtyard Goshen, Indiana was transferred to an affiliate of its lender through a foreclosure auction.  The Company removed the hotel’s net assets and liabilities from its combined consolidated balance sheet and recorded a gain on extinguishment of indebtedness of approximately $3.3 million to discontinued operations.

 

Subsequent Events

On October 8, 2013, the Company acquired the 106-room SpringHill Suites Portland Hillsboro, Oregon for a purchase price of $24.0 million, or approximately $226,000 per key. The purchase price represents a forward capitalization rate of approximately 10% based on the hotel’s projected 2014 net operating income.

 

Balance Sheet and Capital Expenditures

The Company successfully refinanced approximately $565.0 million of secured debt using proceeds from a new $350.0 million five-year unsecured term loan, a $100.0 million expansion of its seven-year unsecured term loan, and a $115.0 million draw on its existing revolving credit facility. The revolving credit facility was subsequently repaid with proceeds from a $150.0 million secured debt financing. The Company also executed interest rate swaps on the new floating rate debt.  As a result of this comprehensive refinancing, the Company expects to realize approximately $10.0 million of interest expense savings in 2014.

 

As of September 30, 2013, the Company had $343.5 million of unrestricted cash on its balance sheet, $300.0 million available on its revolving credit facility, and $1.4 billion of outstanding debt. The Company’s ratio of net debt to Adjusted EBITDA for the trailing twelve month period was 3.4 times.

 

The Company’s capital plan to renovate 25 hotels for approximately $40.0 million to $45.0 million is underway, with most of the renovations taking place currently in the fourth quarter.

 

Dividends

The Company’s Board of Trustees declared a cash dividend of $0.205 per common share of beneficial interest in the third quarter. The dividend was paid on October 15, 2013, to shareholders of record as of September 30, 2013.

 

2013 Outlook

The Company is tightening its previously issued guidance. The outlook excludes potential future acquisitions and dispositions, which could result in a material change to the Company’s outlook. The 2013 outlook is also based on a number of other assumptions, many of which are outside the Company’s control and all of which are subject to change. Pro forma operating statistics include results for periods prior to the Company’s ownership and therefore assume the hotels were owned since January 1, 2012. Pro forma Consolidated Hotel EBITDA includes approximately $6.3 million of prior ownership Hotel EBITDA from hotel acquisitions made in the first nine months of 2013 that is not included in the Company’s corporate Adjusted EBITDA or Adjusted FFO.  Pro forma guidance provided does not include the Company’s recent SpringHill Suites Portland Hillsboro acquisition which was completed subsequent to quarter end.  For the full year 2013, the Company anticipates:

 

3



 

Metric

 

Current Outlook

 

Prior Outlook

Pro forma RevPAR growth (1)

 

6.5% to 7.5%

 

6.5% to 8.0%

Pro forma Hotel EBITDA Margin (1)

 

34.0% to 35.0%

 

34.0% to 35.0%

Pro forma Consolidated Hotel EBITDA

 

$328.0M to $348.0M

 

$328.0M to $348.0M

Corporate Cash General and Administrative expenses

 

$23.5M to $24.5M

 

$23.5M to $24.5M

 


(1) Results exclude two hotel conversions and two non-comparable hotels, the Hotel Indigo New Orleans Garden District and the Residence Inn Atlanta Midtown/Historic. The Hotel Indigo New Orleans Garden District was closed for most of 2012 due to a brand conversion upgrade. The Residence Inn Atlanta Midtown/Historic is currently closed for renovations.

 

Earnings Call

The Company will conduct its quarterly analyst and investor conference call on November 7, 2013, at 10:00 a.m. (Eastern Time). The conference call can be accessed by dialing (877) 705-6003 or (201) 493-6725 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://rljlodgingtrust.com. A replay of the conference call will be archived and available online through the Investor Relations section of the Company’s website.

 

About Us

RLJ Lodging Trust is a self-advised, publicly traded real estate investment trust focused on acquiring premium-branded, focused-service and compact full-service hotels. The Company owns 150 properties, comprised of 148 hotels with approximately 22,400 rooms and two planned hotel conversions, located in 23 states and the District of Columbia.

 

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,” “may” 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

 

4



 

these forward-looking statements and urge 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 SEC.

 

###

 

Additional Contacts:

Leslie D. Hale, Chief Financial Officer, RLJ Lodging Trust – (301) 280-7774

For additional information or to receive press releases via email, please visit our website:

 

http://rljlodgingtrust.com

 

5



 

RLJ Lodging Trust

Non-GAAP Definitions

 

Non-Generally Accepted Accounting Principles (“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) Adjusted EBITDA, and (5) Hotel EBITDA. 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, Adjusted EBITDA, and Hotel EBITDA 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 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, items classified by GAAP as extraordinary, 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 units 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.

 

Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”)

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. The Company presents EBITDA attributable to common shareholders, which includes OP units, because the OP units are redeemable for common shares of the Company. The Company believes it is meaningful for the investor to understand EBITDA attributable to all common shares and OP units.

 

6



 

Hotel EBITDA

With respect to Hotel EBITDA, the Company believes that excluding the effect of corporate-level expenses, certain non-cash items, and the portion of these items related to unconsolidated entities, 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 third-party management companies operating the Company’s business on a property-level basis.

 

Pro forma Hotel EBITDA includes hotel results from prior ownership periods and excludes non-comparable hotels which were not open for operation or were closed for renovations for comparable periods. Pro forma Consolidated Hotel EBITDA includes hotel results from prior ownership periods and includes the results of non-comparable hotels which were not open for operation or were closed for renovations during the comparable periods.

 

Adjustments to FFO and EBITDA

The Company adjusts FFO and EBITDA for certain additional items, such as hotel transaction and pursuit costs, the amortization of share based compensation, and certain other expenses that the Company considers outside the normal course of business. The Company believes that Adjusted FFO and Adjusted EBITDA provide useful supplemental information to investors regarding its ongoing operating performance that, when considered with net income, EBITDA and FFO, is beneficial to an investor’s understanding of its operating performance. The Company adjusts EBITDA and FFO for the following items, as applicable:

 

·                  Transaction and Pursuit Costs: The Company excludes transaction and pursuit costs expensed during the period because it believes they do not reflect the underlying performance of the Company.

·                  Certain Non-Cash Expenses: The Company excludes the effect of certain non-cash items because it believes they do not reflect the underlying performance of the Company. In 2013 and 2012, the Company excluded the amortization of share based compensation. In 2013, the Company excluded non-cash gains on the extinguishment of indebtedness related to the disposition of two hotels, a gain on the acquisition of a hotel through foreclosure sale, the acceleration of deferred financing fees, and the acceleration of deferred management fees. In 2012, the Company excluded a non-cash loss on disposal of furniture, fixtures, and equipment associated with assets under renovation.

·                  Other Non-Operational Expenses: The Company excludes the effect of certain non-operational expenses because it believes they do not reflect the underlying performance of the Company. In 2013 and 2012, the Company excluded legal expenses it considered outside the normal course of business. In 2012, the Company excluded default interest and penalties incurred in connection with the SpringHill Suites Southfield, Michigan mortgage loan.

 

7


 


 

RLJ Lodging Trust

Combined Consolidated Balance Sheets

(Amounts in thousands, except share and per share data)

 

 

 

September 30,
2013

 

December 31,
2012

 

 

 

(unaudited)

 

 

 

Assets

 

 

 

 

 

Investment in hotel and other properties, net

 

$

3,212,289

 

$

3,073,483

 

Investment in loans

 

7,592

 

12,426

 

Cash and cash equivalents

 

343,526

 

115,861

 

Restricted cash reserves

 

53,802

 

64,787

 

Hotel and other receivables, net of allowance of $233 and $194, respectively

 

32,629

 

22,738

 

Deferred financing costs, net

 

12,283

 

11,131

 

Deferred income tax asset

 

2,488

 

2,206

 

Purchase deposits

 

7,996

 

9,910

 

Prepaid expense and other assets

 

33,050

 

33,843

 

Total assets

 

$

3,705,655

 

$

3,346,385

 

Liabilities and Equity

 

 

 

 

 

Borrowings under revolving credit facility

 

$

 

$

16,000

 

Mortgage loans

 

561,256

 

997,651

 

Term loans

 

850,000

 

400,000

 

Accounts payable and accrued expense

 

108,201

 

87,575

 

Deferred income tax liability

 

4,030

 

4,064

 

Advance deposits and deferred revenue

 

12,542

 

8,508

 

Accrued interest

 

2,514

 

2,284

 

Distributions payable

 

26,308

 

22,392

 

Total liabilities

 

1,564,851

 

1,538,474

 

Equity

 

 

 

 

 

Shareholders’ equity:

 

 

 

 

 

Preferred shares of beneficial interest, $0.01 par value, 50,000,000 shares authorized; zero shares issued and outstanding at September 30, 2013 and December 31, 2012, respectively.

 

 

 

Common shares of beneficial interest, $0.01 par value, 450,000,000 shares authorized; 122,687,633 and 106,565,516 shares issued and outstanding at September 30, 2013 and December 31, 2012, respectively.

 

1,227

 

1,066

 

Additional paid-in-capital

 

2,175,749

 

1,841,449

 

Accumulated other comprehensive income

 

(11,429

)

 

Distributions in excess of net earnings

 

(43,291

)

(52,681

)

Total shareholders’ equity

 

2,122,256

 

1,789,834

 

Noncontrolling interest

 

 

 

 

 

Noncontrolling interest in joint venture

 

7,087

 

6,766

 

Noncontrolling interest in Operating Partnership

 

11,461

 

11,311

 

Total noncontrolling interest

 

18,548

 

18,077

 

Total equity

 

2,140,804

 

1,807,911

 

Total liabilities and equity

 

$

3,705,655

 

$

3,346,385

 

 

8



 

RLJ Lodging Trust

Combined Consolidated Statements of Operations

(Amounts in thousands, except share and per share data)

(unaudited)

 

 

 

For the three months ended

 

For the nine months ended

 

 

 

September 30,

 

September 30,

 

 

 

2013

 

2012

 

2013

 

2012

 

Revenue

 

 

 

 

 

 

 

 

 

Operating revenue

 

 

 

 

 

 

 

 

 

Room revenue

 

$

221,597

 

$

196,642

 

$

635,975

 

$

548,539

 

Food and beverage revenue

 

22,907

 

21,345

 

71,206

 

63,231

 

Other operating department revenue

 

7,891

 

6,263

 

21,450

 

17,360

 

Total revenue

 

$

252,395

 

$

224,250

 

$

728,631

 

$

629,130

 

Expense

 

 

 

 

 

 

 

 

 

Operating expense

 

 

 

 

 

 

 

 

 

Room expense

 

49,497

 

43,299

 

139,858

 

120,755

 

Food and beverage expense

 

16,629

 

15,135

 

50,406

 

45,045

 

Management fee expense

 

8,783

 

7,877

 

25,554

 

21,760

 

Other operating expense

 

74,631

 

67,098

 

214,330

 

190,091

 

Total property operating expense

 

149,540

 

133,409

 

430,148

 

377,651

 

Depreciation and amortization

 

31,575

 

30,737

 

94,819

 

95,681

 

Impairment loss

 

 

896

 

 

896

 

Property tax, insurance and other

 

16,651

 

14,175

 

47,929

 

39,180

 

General and administrative

 

8,969

 

8,101

 

26,861

 

22,809

 

Transaction and pursuit costs

 

478

 

326

 

2,822

 

3,140

 

Total operating expense

 

207,213

 

187,644

 

602,579

 

539,357

 

Operating income

 

45,182

 

36,606

 

126,052

 

89,773

 

Other income

 

164

 

68

 

334

 

258

 

Interest income

 

241

 

416

 

777

 

1,253

 

Interest expense

 

(16,511

)

(20,723

)

(50,171

)

(61,029

)

Loss on disposal

 

 

 

 

(634

)

Gain on foreclosure

 

4,831

 

 

4,831

 

 

Income from continuing operations before income tax expense

 

33,907

 

16,367

 

81,823

 

29,621

 

Income tax expense

 

(181

)

(339

)

(752

)

(1,214

)

Income from continuing operations

 

33,726

 

16,028

 

81,071

 

28,407

 

Income (loss) from discontinued operations

 

3,202

 

(727

)

5,426

 

(1,008

)

Net income

 

36,928

 

15,301

 

86,497

 

27,399

 

Net (income) loss attributable to non-controlling interests

 

 

 

 

 

 

 

 

 

Noncontrolling interest in consolidated joint venture

 

(166

)

44

 

(321

)

452

 

Noncontrolling interest in common units of Operating Partnership

 

(293

)

(149

)

(700

)

(283

)

Net income attributable to common shareholders

 

$

36,469

 

$

15,196

 

$

85,476

 

$

27,568

 

 

 

 

 

 

 

 

 

 

 

Basic per common share data:

 

 

 

 

 

 

 

 

 

Net income per share attributable to common shareholders before discontinued operations

 

$

0.27

 

$

0.15

 

$

0.68

 

$

0.27

 

Discontinued operations

 

0.03

 

(0.01

)

0.05

 

(0.01

)

Net income per share attributable to common shareholders

 

$

0.30

 

$

0.14

 

$

0.73

 

$

0.26

 

Weighted-average number of common shares

 

121,594,219

 

105,453,978

 

116,697,417

 

105,392,071

 

Diluted per common share data:

 

 

 

 

 

 

 

 

 

Net income per share attributable to common shareholders before discontinued operations

 

$

0.27

 

$

0.15

 

$

0.67

 

$

0.27

 

Discontinued operations

 

0.03

 

(0.01

)

0.05

 

(0.01

)

Net income per share attributable to common shareholders

 

$

0.30

 

$

0.14

 

$

0.72

 

$

0.26

 

Weighted-average number of common shares

 

122,750,121

 

105,509,104

 

117,797,670

 

105,446,211

 

 


Note:

The Statement of Comprehensive Income and corresponding footnotes can be found in the Company’s Quarterly Report on Form 10-Q.

 

9



 

RLJ Lodging Trust

Reconciliation of Net Income to Non-GAAP Measures

(Amounts in thousands, except per share data)

(unaudited)

 

Funds From Operations (FFO)

 

 

 

For the three months ended

 

For the nine months ended

 

 

 

September 30,

 

September 30,

 

 

 

2013

 

2012

 

2013

 

2012

 

Net income

 

$

36,928

 

$

15,301

 

$

86,497

 

$

27,399

 

Depreciation and amortization

 

31,575

 

30,737

 

94,819

 

95,681

 

Loss on disposal

 

 

 

 

634

 

Gain on extinguishment of indebtedness (1)

 

(3,277

)

 

(5,702

)

 

Impairment loss

 

 

896

 

 

896

 

Noncontrolling interest in joint venture

 

(166

)

44

 

(321

)

452

 

Adjustments related to discontinued operations (2)

 

11

 

74

 

120

 

281

 

Adjustments related to joint venture (3)

 

(121

)

(119

)

(363

)

(330

)

FFO attributable to common shareholders

 

64,950

 

46,933

 

175,050

 

125,013

 

Gain on foreclosure

 

(4,831

)

 

(4,831

)

 

Transaction and pursuit costs

 

478

 

326

 

2,822

 

3,140

 

Amortization of share based compensation

 

3,344

 

2,550

 

9,691

 

5,763

 

Loan related costs (4)(5)

 

1,046

 

669

 

1,046

 

669

 

Other expenses (6)

 

133

 

125

 

157

 

302

 

Adjusted FFO

 

$

65,120

 

$

50,603

 

$

183,935

 

$

134,887

 

 

 

 

 

 

 

 

 

 

 

Adjusted FFO per common share and unit-basic

 

$

0.53

 

$

0.48

 

$

1.56

 

$

1.27

 

Adjusted FFO per common share and unit-diluted

 

$

0.53

 

$

0.48

 

$

1.55

 

$

1.27

 

 

 

 

 

 

 

 

 

 

 

Basic weighted-average common shares and units (7)

 

122,488

 

106,348

 

117,591

 

106,286

 

Diluted weighted-average common shares and units (7)

 

123,644

 

106,403

 

118,692

 

106,340

 

 


Note:

(1)    Represents the gain on extinguishment of indebtedness from the SpringHill Suites Southfield, Michigan and Courtyard Goshen, Indiana. The gain is included in discontinued operations.

(2)    Includes depreciation and amortization expense from discontinued operations.

(3)    Includes depreciation and amortization expense allocated to the noncontrolling interest in the joint venture.

(4)    Represents accelerated amortization of deferred financing fees related to the paydown of mortgage indebtedness for the three and nine months ended September 30, 2013, respectively.

(5)    Represents default interest and penalties incurred in connection with the SpringHill Suites Southfield, Michigan mortgage loan for the three and nine months ended September 30, 2012, respectively.

(6)    Represents accelerated deferred management fees related to the Courtyard Goshen, Indiana and the SpringHill Suites Southfield, Michigan and legal expenses outside the normal course of operations.

(7)    Includes 0.9 million operating partnership units.

 

10



 

RLJ Lodging Trust

Reconciliation of Net Income to Non-GAAP Measures

(Amounts in thousands)

(unaudited)

 

Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA)

 

 

 

For the three months ended

 

For the nine months ended

 

 

 

September 30,

 

September 30,

 

 

 

2013

 

2012

 

2013

 

2012

 

Net income

 

$

36,928

 

$

15,301

 

$

86,497

 

$

27,399

 

Depreciation and amortization

 

31,575

 

30,737

 

94,819

 

95,681

 

Interest expense, net (1)

 

16,501

 

20,715

 

50,149

 

60,999

 

Income tax expense

 

181

 

339

 

752

 

1,214

 

Noncontrolling interest in joint venture

 

(166

)

44

 

(321

)

452

 

Adjustments related to discontinued operations (2)

 

42

 

949

 

492

 

1,405

 

Adjustments related to joint venture (3)

 

(121

)

(295

)

(363

)

(854

)

EBITDA

 

84,940

 

67,790

 

232,025

 

186,296

 

Gain on foreclosure

 

(4,831

)

 

(4,831

)

 

Transaction and pursuit costs

 

478

 

326

 

2,822

 

3,140

 

Gain on extinguishment of indebtedness (4)

 

(3,277

)

 

(5,702

)

 

Impairment loss

 

 

896

 

 

896

 

Loss on disposal

 

 

 

 

634

 

Amortization of share based compensation

 

3,344

 

2,550

 

9,691

 

5,763

 

Other expenses (5)

 

133

 

125

 

157

 

302

 

Adjusted EBITDA

 

$

80,787

 

$

71,687

 

$

234,162

 

$

197,031

 

General and administrative (6)

 

5,624

 

5,552

 

17,170

 

17,046

 

Other income/interest income

 

(395

)

(476

)

(1,089

)

(1,481

)

Corporate overhead allocated to properties

 

130

 

167

 

432

 

475

 

Operating results from discontinued operations

 

(99

)

(222

)

(348

)

(396

)

Apartment income

 

(188

)

 

(420

)

 

Operating results from noncontrolling interest in joint venture

 

287

 

251

 

684

 

402

 

Pro forma adjustments (7)

 

69

 

5,071

 

6,327

 

18,460

 

Non-cash amortization (8)

 

297

 

215

 

891

 

699

 

Pro forma Consolidated Hotel EBITDA

 

86,512

 

82,245

 

257,809

 

232,236

 

Non-comparable hotels (9)

 

(133

)

(18

)

(1,304

)

(387

)

Pro forma Hotel EBITDA

 

$

86,379

 

$

82,227

 

$

256,505

 

$

231,849

 

 


Note:

(1)    Excludes amounts attributable to investment in loans of $0.2 million and $0.8 million for the three and nine months ended September 30, 2013, respectively and $0.4 million and $1.2 million for the three and nine months ended September 30, 2012, respectively.

(2)    Includes depreciation, amortization and interest expense from discontinued operations.

(3)    Includes depreciation, amortization and interest expense allocated to the noncontrolling interest in the joint venture.

(4)    Represents the gain on extinguishment of indebtedness from the SpringHill Suites Southfield, Michigan and Courtyard Goshen, Indiana. The gain is included in discontinued operations.

(5)    Represents accelerated deferred management fees related to the Courtyard Goshen, Indiana and the SpringHill Suites Southfield, Michigan and legal expenses outside the normal course of operations.

(6)    General and administrative expenses exclude amortization of share based compensation, which is reflected in Adjusted EBITDA.

(7)    Reflects prior ownership results of recent acquisitions.

(8)    Non-cash amortization includes the amortization of deferred management, franchise fees, and key money.

(9)    Results primarily reflect the Hotel Indigo New Orleans Garden District and the Residence Inn Atlanta Midtown/Historic.  The Hotel Indigo New Orleans reopened in December 2012.  The Residence Inn Atlanta Midtown/Historic is currently closed and will be undergoing a comprehensive renovation.   Therefore the results for both hotels have been excluded from 2013 and 2012.

 

11


 


 

RLJ Lodging Trust

Consolidated Debt Summary

(Amounts in thousands, except metrics)

(unaudited)

 

Loan

 

Base Term
(Years)

 

Maturity
(incl. extensions)

 

Floating /
Fixed

 

Interest
Rate (1)

 

Balance as of
September 30, 2013

 

Secured Debt

 

 

 

 

 

 

 

 

 

 

 

Wells Fargo - 4 hotels

 

3

 

Oct 2016

 

Floating

 

3.78

%

$

 73,500

 

Wells Fargo - 1 hotel

 

3

 

Oct 2016

 

Floating (2)(3)

 

4.60

%

68,500

 

Capmark Financial Group - 1 hotel

 

10

 

Apr 2015

 

Fixed

 

6.12

%

4,102

 

Capmark Financial Group - 1 hotel

 

10

 

May 2015

 

Fixed

 

5.55

%

11,013

 

Capmark Financial Group - 1 hotel

 

10

 

Jun 2015

 

Fixed

 

5.55

%

4,777

 

Barclay’s Bank - 14 hotels

 

10

 

Jun 2015

 

Fixed

 

5.55

%

119,203

 

Barclay’s Bank - 4 hotels

 

10

 

Jun 2015

 

Fixed

 

5.60

%

28,044

 

Capmark Financial Group - 1 hotel

 

10

 

Jul 2015

 

Fixed

 

5.50

%

6,506

 

Barclay’s Bank - 1 hotel

 

10

 

Sep 2015

 

Fixed

 

5.44

%

10,611

 

PNC Bank - 7 hotels

 

4

 

May 2017

 

Floating

 

2.53

%

85,000

 

Wells Fargo - 4 hotels

 

3

 

Sep 2020

 

Floating (2)

 

4.19

%

150,000

 

Weighted Average/Secured Total

 

 

 

 

 

 

 

4.39

%

$

 561,256

 

 

 

 

 

 

 

 

 

 

 

 

 

Unsecured Debt

 

 

 

 

 

 

 

 

 

 

 

Credit Facility

 

4

 

Nov 2017

 

Floating

 

1.93

%

 

Five-Year Term Loan

 

5

 

Nov 2017

 

Floating (2)(4)

 

1.88

%

275,000

 

Five-Year Term Loan

 

5

 

Aug 2018

 

Floating (2)

 

3.25

%

350,000

 

Seven-Year Term Loan

 

7

 

Nov 2019

 

Floating (2)

 

4.04

%

225,000

 

Weighted Average/Unsecured Total

 

 

 

 

 

 

 

3.01

%

$

 850,000

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Consolidated Debt

 

 

 

 

 

 

 

3.56

%

$

 1,411,256

 

 


Note:

(1)    Interest rates include the effect of interest rate swaps as of September 30, 2013.

(2)    The floating interest rate is hedged with an interest rate swap.

(3)    The interest rate swap expired October 2013.

(4)    Interest rate does not reflect the forward interest rate swap, which goes into effect in December 2014.

 

12



 

RLJ Lodging Trust

Acquisitions

(unaudited)

 

2013 Acquisitions

 

Location

 

Acquisition
Date

 

Management Company

 

Rooms

 

Gross Purchase
Price
($ in millions)

 

%
Interest

 

Courtyard Houston Downtown

 

Houston, TX

 

Mar 19, 2013

 

White Lodging Services

 

191

 

$

34.4

 

100

%

Residence Inn Houston Downtown

 

Houston, TX

 

Mar 19, 2013

 

White Lodging Services

 

171

 

29.5

 

100

%

Humble Tower Apartments (1)

 

Houston, TX

 

Mar 19, 2013

 

The Sterling Group

 

82

 

15.6

 

100

%

Courtyard Waikiki Beach

 

Honolulu, HI

 

Jun 17, 2013

 

Highgate Hotels

 

399

 

75.3

 

100

%

Vantaggio Suites Cosmo (2)

 

San Francisco, CA

 

Jun 21, 2013

 

N/A

 

150

 

29.5

 

100

%

Residence Inn Atlanta Midtown/Historic (3)

 

Atlanta, GA

 

Aug 6, 2013

 

N/A

 

78

 

5.0

 

100

%

Hilton Cabana Miami Beach (4)

 

Miami Beach, FL

 

N/A

 

N/A

 

N/A

 

71.6

 

100

%

Total Acquisitions

 

 

 

 

 

 

 

1,071

 

$

260.9

 

 

 

 

2012 Acquisitions

 

Location

 

Acquisition
Date

 

Management Company

 

Rooms

 

Gross Purchase
Price
($ in millions)

 

%
Interest

 

Residence Inn Bethesda Downtown

 

Bethesda, MD

 

May 29, 2012

 

Marriott International

 

187

 

$

64.5

 

100

%

Courtyard New York Manhattan/Upper East Side

 

New York, NY

 

May 30, 2012

 

Highgate Hotels

 

226

 

82.0

 

100

%

Hilton Garden Inn San Francisco/Oakland Bay Bridge

 

Emeryville, CA

 

Jun 11, 2012

 

Davidson Hotels & Resorts

 

278

 

36.2

 

100

%

Embassy Suites Boston/Waltham

 

Waltham, MA

 

Nov 13, 2012

 

HEI Hotels and Resorts

 

275

 

64.5

 

100

%

Total Acquisitions

 

 

 

 

 

 

 

966

 

$

247.2

 

 

 

 


Note:

(1)     This asset will undergo a conversion to a 166-room SpringHill Suites that is expected to be complete by mid-2015.

(2)     This property is currently closed to undergo a conversion to a 150-room Courtyard by Marriott that is expected to be completed by late 2014.

(3)     Purchase price reflects original investment in the mortgage note.  The hotel was closed subsequent to the acquisition and will undergo a comprehensive renovation.

(4)     On November 30, 2012, the Company signed a purchase and sale agreement to acquire upon completion the 231-room Hilton Cabana Miami Beach for a fixed purchase price of $71.6 million, or approximately $310,000 per key. The transaction is expected to close in the fourth quarter of 2013 or early 2014.

 

13



 

RLJ Lodging Trust

Pro forma Operating Statistics — Top 40 Assets

(Amounts in thousands, except rooms)

(unaudited)

 

For the trailing twelve months ended September 30, 2013

 

Property

 

City/State

 

Rooms

 

Pro forma
Consolidated Hotel
EBITDA

 

DoubleTree Metropolitan

 

New York, NY

 

764

 

$

21,528

 

Marriott Louisville Downtown

 

Louisville, KY

 

616

 

14,461

 

Hilton New York Fashion District

 

New York, NY

 

280

 

12,020

 

Hilton Garden Inn New York

 

New York, NY

 

298

 

11,689

 

Courtyard Austin Downtown

 

Austin, TX

 

270

 

9,261

 

Courtyard Waikiki Beach (1)

 

Honolulu - Oahu, HI

 

399

 

8,268

 

Courtyard Chicago Downtown Mag Mile

 

Chicago, IL

 

306

 

7,682

 

Courtyard Upper East Side

 

New York, NY

 

226

 

5,857

 

Fairfield Inn Washington DC

 

Washington, DC

 

198

 

5,551

 

Renaissance Pittsburgh

 

Pittsburgh, PA

 

300

 

5,516

 

Embassy Suites Tampa Downtown

 

Tampa, FL

 

360

 

5,423

 

Embassy Suites Waltham

 

Waltham, MA

 

275

 

5,344

 

Marriott Denver South at Park Meadow

 

Littleton, CO

 

279

 

5,102

 

Residence Inn Bethesda

 

Bethesda, MD

 

187

 

4,951

 

Homewood Suites Washington DC

 

Washington, DC

 

175

 

4,666

 

Residence Inn Austin Downtown

 

Austin, TX

 

179

 

4,586

 

Marriott Denver International Airport

 

Aurora, CO

 

238

 

4,473

 

Hilton Garden Inn Emeryville

 

Emeryville, CA

 

278

 

4,421

 

Hilton Garden Inn Los Angeles Hollywood

 

Hollywood, CA

 

160

 

4,187

 

Courtyard Houston Galleria

 

Houston, TX

 

190

 

4,180

 

Residence Inn National Harbor

 

Oxon Hill, MD

 

162

 

3,949

 

Courtyard Houston Downtown

 

Houston, TX

 

191

 

3,747

 

Hilton Garden Inn New Orleans Convention Center

 

New Orleans, LA

 

286

 

3,641

 

Embassy Suites Downey

 

Downey, CA

 

219

 

3,621

 

Renaissance Plantation

 

Plantation, FL

 

250

 

3,576

 

Renaissance Boulder Suites at Flatiron

 

Broomfield, CO

 

232

 

3,540

 

Courtyard Charleston Historic District

 

Charleston, SC

 

176

 

3,461

 

Hampton Inn Garden City

 

Garden City, NY

 

143

 

3,381

 

Residence Inn Houston Downtown

 

Houston, TX

 

171

 

3,196

 

Marriott Airport Austin South

 

Austin, TX

 

211

 

3,194

 

Residence Inn Galleria

 

Houston, TX

 

146

 

3,172

 

Residence Inn Oakbrook

 

Oak Brook, IL

 

156

 

3,115

 

Hilton Garden Inn Bloomington

 

Bloomington, IN

 

168

 

2,883

 

Residence Inn Downtown Louisville

 

Louisville, KY

 

140

 

2,796

 

Hilton Garden Inn Pittsburgh

 

Pittsburgh, PA

 

202

 

2,769

 

Fairfield Inn & Suites Key West

 

Key West, FL

 

106

 

2,721

 

Hyatt House Dallas Lincoln Park

 

Dallas, TX

 

155

 

2,445

 

Marriott Midway

 

Chicago, IL

 

200

 

2,408

 

Hampton Inn Houston Galleria

 

Houston, TX

 

176

 

2,222

 

Embassy Suites West Palm Beach

 

West Palm Beach, FL

 

194

 

2,132

 

Top 40 Assets

 

 

 

9,662

 

211,133

 

Other (2)

 

 

 

12,619

 

127,947

 

Total Portfolio

 

 

 

22,281

 

$

339,080

 

 


Note:

The information above has not been audited and is presented only for comparison purposes.  Results reflect 100% of DoubleTree by Hilton Hotel Metropolitan New York City financial results, which have not been adjusted to reflect the 5% noncontrolling interest in the joint venture.

(1)    The trailing twelve months for the Courtyard Waikiki Beach do not include ground lease payments for periods prior to the Company’s ownership. The Company entered into a ground lease upon acquisition, with an annual ground rent amount of $3.5 million through 2016 and subject to CPI increases thereafter.

(2)    All results exclude hotels in discontinued operations and two planned hotel conversions.

 

14


 


 

RLJ Lodging Trust

Pro forma Operating Statistics

(unaudited)

 

For the three months ended September 30, 2013

 

 

 

 

 

Occupancy

 

ADR

 

RevPAR

 

% of Hotel
EBITDA

 

Top Markets

 

# of Hotels

 

2013

 

2012

 

Var

 

2013

 

2012

 

Var

 

2013

 

2012

 

Var

 

Q3

 

NYC

 

5

 

97.5

%

96.0

%

1.6

%

$

243.70

 

$

231.75

 

5.2

%

$

237.66

 

$

222.39

 

6.9

%

16

%

Chicago

 

21

 

79.9

%

79.5

%

0.4

%

131.86

 

129.26

 

2.0

%

105.30

 

102.82

 

2.4

%

13

%

Austin

 

17

 

71.8

%

68.0

%

5.5

%

124.85

 

117.61

 

6.2

%

89.60

 

80.00

 

12.0

%

8

%

Denver

 

15

 

83.6

%

78.9

%

6.0

%

126.39

 

123.04

 

2.7

%

105.63

 

97.04

 

8.9

%

12

%

Houston

 

8

 

72.9

%

71.0

%

2.6

%

143.32

 

123.49

 

16.1

%

104.42

 

87.66

 

19.1

%

5

%

Washington DC

 

7

 

76.8

%

84.4

%

(9.0

)%

161.22

 

161.43

 

(0.1

)%

123.78

 

136.23

 

(9.1

)%

6

%

Other

 

72

 

76.1

%

74.8

%

1.7

%

121.86

 

118.73

 

2.6

%

92.76

 

88.84

 

4.4

%

40

%

Total

 

145

 

78.3

%

77.0

%

1.8

%

$

138.66

 

$

133.86

 

3.6

%

$

108.63

 

$

103.06

 

5.4

%

100

%

 

 

 

 

 

Occupancy

 

ADR

 

RevPAR

 

% of Hotel
EBITDA

 

Service Level

 

# of Hotels

 

2013

 

2012

 

Var

 

2013

 

2012

 

Var

 

2013

 

2012

 

Var

 

Q3

 

Focused-Service

 

124

 

77.7

%

76.7

%

1.2

%

$

130.54

 

$

125.79

 

3.8

%

$

101.41

 

$

96.52

 

5.1

%

70

%

Compact Full-Service

 

20

 

81.5

%

79.0

%

3.2

%

161.63

 

157.44

 

2.7

%

131.80

 

124.34

 

6.0

%

27

%

Full Service

 

1

 

69.1

%

67.1

%

2.9

%

154.35

 

145.54

 

6.1

%

106.65

 

97.69

 

9.2

%

3

%

Total

 

145

 

78.3

%

77.0

%

1.8

%

$

138.66

 

$

133.86

 

3.6

%

$

108.63

 

$

103.06

 

5.4

%

100

%

 

 

 

 

 

Occupancy

 

ADR

 

RevPAR

 

% of Hotel
EBITDA

 

Chain Scale 

 

# of Hotels

 

2013

 

2012

 

Var

 

2013

 

2012

 

Var

 

2013

 

2012

 

Var

 

Q3

 

Upper Upscale Chains

 

17

 

78.6

%

75.9

%

3.5

%

$

148.02

 

$

144.81

 

2.2

%

$

116.28

 

$

109.88

 

5.8

%

22

%

Upscale Chains

 

100

 

79.4

%

78.6

%

1.1

%

140.76

 

134.22

 

4.9

%

111.78

 

105.44

 

6.0

%

68

%

Upper Midscale Chains

 

27

 

72.4

%

70.8

%

2.3

%

116.43

 

117.85

 

(1.2

)%

84.35

 

83.49

 

1.0

%

10

%

Midscale Chains

 

1

 

92.0

%

87.0

%

5.7

%

68.20

 

70.82

 

(3.7

)%

62.73

 

61.62

 

1.8

%

0

%

Total

 

145

 

78.3

%

77.0

%

1.8

%

$

138.66

 

$

133.86

 

3.6

%

$

108.63

 

$

103.06

 

5.4

%

100

%

 

 

 

 

 

Occupancy

 

ADR

 

RevPAR

 

% of Hotel
EBITDA

 

Flag

 

# of Hotels

 

2013

 

2012

 

Var

 

2013

 

2012

 

Var

 

2013

 

2012

 

Var

 

Q3

 

Courtyard

 

35

 

77.4

%

75.5

%

2.5

%

$

137.94

 

$

132.16

 

4.4

%

$

106.77

 

$

99.77

 

7.0

%

23

%

Residence Inn

 

35

 

80.6

%

81.2

%

(0.7

)%

127.69

 

120.01

 

6.4

%

102.93

 

97.46

 

5.6

%

19

%

Fairfield Inn

 

14

 

71.9

%

72.7

%

(1.2

)%

114.60

 

119.94

 

(4.5

)%

82.34

 

87.21

 

(5.6

)%

5

%

SpringHill Suites

 

10

 

75.6

%

72.4

%

4.4

%

105.73

 

100.78

 

4.9

%

79.94

 

72.97

 

9.5

%

4

%

Hilton Garden Inn

 

10

 

78.5

%

77.9

%

0.8

%

159.36

 

153.47

 

3.8

%

125.15

 

119.53

 

4.7

%

10

%

Hampton Inn

 

9

 

73.9

%

70.7

%

4.4

%

122.25

 

120.60

 

1.4

%

90.32

 

85.31

 

5.9

%

4

%

Marriott

 

6

 

74.6

%

73.1

%

2.0

%

140.86

 

131.55

 

7.1

%

105.11

 

96.22

 

9.2

%

9

%

Hyatt House

 

6

 

80.7

%

80.9

%

(0.3

)%

104.16

 

99.22

 

5.0

%

84.04

 

80.25

 

4.7

%

3

%

Embassy Suites

 

6

 

79.0

%

74.5

%

6.1

%

127.77

 

132.61

 

(3.6

)%

100.91

 

98.73

 

2.2

%

5

%

Renaissance

 

3

 

79.1

%

75.5

%

4.7

%

147.01

 

147.76

 

(0.5

)%

116.24

 

111.55

 

4.2

%

4

%

DoubleTree

 

2

 

92.6

%

92.4

%

0.2

%

233.12

 

219.56

 

6.2

%

215.79

 

202.77

 

6.4

%

7

%

Homewood Suites

 

2

 

76.4

%

78.1

%

(2.3

)%

156.42

 

154.57

 

1.2

%

119.44

 

120.74

 

(1.1

)%

2

%

Hilton

 

2

 

92.0

%

91.8

%

0.2

%

226.00

 

213.05

 

6.1

%

207.85

 

195.57

 

6.3

%

4

%

Other

 

5

 

75.0

%

69.9

%

7.3

%

98.89

 

96.69

 

2.3

%

74.19

 

67.60

 

9.7

%

1

%

Total

 

145

 

78.3

%

77.0

%

1.8

%

$

138.66

 

$

133.86

 

3.6

%

$

108.63

 

$

103.06

 

5.4

%

100

%

 


Note:

The information above includes results for periods prior to the Company’s ownership. The information has not been audited and is presented only for comparison purposes.  Results

reflect 100% of DoubleTree by Hilton Hotel Metropolitan New York City financial results, which have not been adjusted to reflect the 5% noncontrolling interest in the joint venture.

All results exclude hotels in discontinued operations, two planned hotel conversions, and two non-comparable hotels, the Hotel Indigo New Orleans Garden District and the

Residence Inn Atlanta Midtown/Historic. The Hotel Indigo New Orleans Garden District was closed for most of 2012 due to a conversion upgrade. The Residence Inn Atlanta

Midtown/Historic is currently closed and will be undergoing a comprehensive renovation.

 

15


 


 

RLJ Lodging Trust

Pro forma Operating Statistics

(unaudited)

 

For the nine months ended September 30, 2013

 

 

 

 

 

Occupancy

 

ADR

 

RevPAR

 

% of Hotel
EBITDA

 

Top Markets

 

# of Hotels

 

2013

 

2012

 

Var

 

2013

 

2012

 

Var

 

2013

 

2012

 

Var

 

Q3YTD

 

NYC

 

5

 

96.8

%

85.0

%

13.9

%

$

230.96

 

$

225.88

 

2.3

%

$

223.56

 

$

192.02

 

16.4

%

14

%

Chicago

 

21

 

73.5

%

73.4

%

0.1

%

127.91

 

120.69

 

6.0

%

94.04

 

88.61

 

6.1

%

10

%

Austin

 

17

 

75.5

%

73.0

%

3.5

%

137.41

 

127.06

 

8.2

%

103.74

 

92.72

 

11.9

%

11

%

Denver

 

15

 

73.7

%

72.7

%

1.4

%

122.69

 

118.53

 

3.5

%

90.46

 

86.19

 

5.0

%

9

%

Houston

 

8

 

75.8

%

72.9

%

3.9

%

147.65

 

131.13

 

12.6

%

111.95

 

95.65

 

17.0

%

7

%

Washington DC

 

7

 

73.5

%

76.6

%

(4.1

)%

171.72

 

166.17

 

3.3

%

126.15

 

127.31

 

(0.9

)%

7

%

Other

 

72

 

74.7

%

73.4

%

1.6

%

125.58

 

120.50

 

4.2

%

93.75

 

88.50

 

5.9

%

42

%

Total

 

145

 

76.2

%

74.3

%

2.5

%

$

140.64

 

$

133.22

 

5.6

%

$

107.22

 

$

99.04

 

8.2

%

100

%

 

 

 

 

 

Occupancy

 

ADR

 

RevPAR

 

% of Hotel
EBITDA

 

Service Level

 

# of Hotels

 

2013

 

2012

 

Var

 

2013

 

2012

 

Var

 

2013

 

2012

 

Var

 

Q3YTD

 

Focused-Service

 

124

 

75.4

%

74.6

%

1.1

%

$

132.68

 

$

125.11

 

6.0

%

$

100.03

 

$

93.31

 

7.2

%

71

%

Compact Full-Service

 

20

 

79.6

%

74.3

%

7.1

%

161.17

 

155.51

 

3.6

%

128.30

 

115.58

 

11.0

%

25

%

Full Service

 

1

 

70.3

%

68.5

%

2.7

%

173.07

 

164.00

 

5.5

%

121.69

 

112.30

 

8.4

%

4

%

Total

 

145

 

76.2

%

74.3

%

2.5

%

$

140.64

 

$

133.22

 

5.6

%

$

107.22

 

$

99.04

 

8.2

%

100

%

 

 

 

 

 

Occupancy

 

ADR

 

RevPAR

 

% of Hotel
EBITDA

 

Chain Scale

 

# of Hotels

 

2013

 

2012

 

Var

 

2013

 

2012

 

Var

 

2013

 

2012

 

Var

 

Q3YTD

 

Upper Upscale Chains

 

17

 

76.8

%

74.8

%

2.6

%

$

152.50

 

$

147.73

 

3.2

%

$

117.16

 

$

110.57

 

6.0

%

23

%

Upscale Chains

 

100

 

77.2

%

75.0

%

2.8

%

141.39

 

132.68

 

6.6

%

109.09

 

99.55

 

9.6

%

66

%

Upper Midscale Chains

 

27

 

70.6

%

69.9

%

1.0

%

121.39

 

116.34

 

4.3

%

85.75

 

81.36

 

5.4

%

11

%

Midscale Chains

 

1

 

85.5

%

86.5

%

(1.1

)%

66.13

 

65.86

 

0.4

%

56.57

 

56.97

 

(0.7

)%

0

%

Total

 

145

 

76.2

%

74.3

%

2.5

%

$

140.64

 

$

133.22

 

5.6

%

$

107.22

 

$

99.04

 

8.2

%

100

%

 

 

 

 

 

Occupancy

 

ADR

 

RevPAR

 

% of Hotel
EBITDA

 

Flag

 

# of Hotels

 

2013

 

2012

 

Var

 

2013

 

2012

 

Var

 

2013

 

2012

 

Var

 

Q3YTD

 

Courtyard

 

35

 

75.0

%

73.1

%

2.5

%

$

139.50

 

$

130.71

 

6.7

%

$

104.56

 

$

95.58

 

9.4

%

23

%

Residence Inn

 

35

 

77.4

%

77.9

%

(0.7

)%

129.89

 

121.71

 

6.7

%

100.48

 

94.81

 

6.0

%

18

%

Fairfield Inn

 

14

 

70.2

%

72.3

%

(2.8

)%

122.16

 

116.86

 

4.5

%

85.77

 

84.44

 

1.6

%

5

%

SpringHill Suites

 

10

 

72.1

%

70.8

%

1.9

%

106.54

 

101.96

 

4.5

%

76.86

 

72.20

 

6.5

%

4

%

Hilton Garden Inn

 

10

 

77.8

%

76.0

%

2.4

%

158.68

 

149.63

 

6.1

%

123.52

 

113.69

 

8.6

%

10

%

Hampton Inn

 

9

 

72.5

%

69.4

%

4.4

%

125.12

 

119.66

 

4.6

%

90.68

 

83.06

 

9.2

%

4

%

Marriott

 

6

 

72.5

%

70.6

%

2.7

%

147.27

 

138.40

 

6.4

%

106.81

 

97.72

 

9.3

%

10

%

Hyatt House

 

6

 

80.7

%

79.1

%

2.0

%

105.99

 

100.37

 

5.6

%

85.51

 

79.40

 

7.7

%

3

%

Embassy Suites

 

6

 

79.4

%

77.3

%

2.7

%

138.52

 

137.57

 

0.7

%

109.93

 

106.31

 

3.4

%

6

%

Renaissance

 

3

 

76.0

%

73.6

%

3.1

%

147.49

 

148.56

 

(0.7

)%

112.04

 

109.40

 

2.4

%

4

%

DoubleTree

 

2

 

91.1

%

72.1

%

26.3

%

220.03

 

219.36

 

0.3

%

200.47

 

158.20

 

26.7

%

6

%

Homewood Suites

 

2

 

76.5

%

79.1

%

(3.3

)%

166.33

 

160.20

 

3.8

%

127.31

 

126.73

 

0.5

%

2

%

Hilton

 

2

 

87.6

%

86.3

%

1.5

%

215.96

 

204.79

 

5.5

%

189.08

 

176.66

 

7.0

%

4

%

Other

 

5

 

71.2

%

68.8

%

3.6

%

100.16

 

96.94

 

3.3

%

71.33

 

66.65

 

7.0

%

1

%

Total

 

145

 

76.2

%

74.3

%

2.5

%

$

140.64

 

$

133.22

 

5.6

%

$

107.22

 

$

99.04

 

8.2

%

100

%

 


Note:

The information above includes results for periods prior to the Company’s ownership. The information has not been audited and is presented only for comparison purposes.  Results reflect 100% of DoubleTree by Hilton Hotel Metropolitan New York City financial results, which have not been adjusted to reflect the 5% noncontrolling interest in the joint venture. All results exclude hotels in discontinued operations, two planned hotel conversions, and two non-comparable hotels, the Hotel Indigo New Orleans Garden District and the Residence Inn Atlanta Midtown/Historic. The Hotel Indigo New Orleans Garden District was closed for most of 2012 due to a conversion upgrade. The Residence Inn Atlanta Midtown/Historic is currently closed and will be undergoing a comprehensive renovation.

 

16