RLJ Lodging Trust Reports Second Quarter 2016 Results

BETHESDA, Md.–(hospitalitybusinessnews.com)–RLJ Lodging Trust  today reported results for the three and six months ended June 30, 2016.

Highlights

  • Net income increased 4.1% to $58.7 million
  • Pro forma RevPAR increased 1.9%, Pro forma ADR increased 1.6%, and Pro forma Occupancy increased 0.4%
  • Pro forma Hotel EBITDA Margin of 39.2%
  • Pro forma Consolidated Hotel EBITDA increased 5.3% to $123.9 million
  • Adjusted FFO increased 4.2% to $102.1 million
  • Refinanced $800.0 million of unsecured debt; extended final maturities to 2021, improved pricing, and enhanced financial covenants
  • Repurchased 0.1 million common shares for $2.0 million
  • Ross H. Bierkan appointed President and Chief Executive Officer
  • Leslie D. Hale appointed Chief Operating Officer

“Our ability to drive positive RevPAR growth and maintain robust hotel EBITDA margins despite severe macro-economic headwinds reaffirms the benefits of our geographically diverse portfolio,” commented Ross H. Bierkan, President and Chief Executive Officer. “While the second half of this year is likely to be influenced by increased market volatility, we remain focused on executing our operational strategy, maintaining a fortress balance sheet, and identifying opportunities to unlock additional shareholder value.”

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 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, 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.

Net income for the three months ended June 30, 2016, was $58.7 million, compared to $56.4 million for the comparable period in 2015. For the six months ended June 30, 2016, net income was $84.1 million, compared to $104.5 million for the comparable period in 2015.

Pro forma RevPAR for the three months ended June 30, 2016, increased 1.9% over the comparable period in 2015, driven by a Pro forma ADR increase of 1.6%, and a Pro forma Occupancy increase of 0.4%. Excluding Chicago and Houston, which experienced softness in the quarter, Pro forma RevPAR growth was 3.7%. The Company’s non-top 10 markets achieved 6.4% RevPAR growth, which included three markets that achieved double-digit RevPAR growth, including San Antonio, Portland, and Indianapolis, which experienced RevPAR growth of 11.6%, 10.9% and 10.7%, respectively. For the six months ended June 30, 2016, Pro forma RevPAR increased 2.0% over the comparable period in 2015, driven by a Pro forma ADR increase of 1.8%, and a Pro forma Occupancy increase of 0.2%.

Pro forma Hotel EBITDA Margin for the three months ended June 30, 2016, decreased 16 basis points over the comparable period in 2015 to 39.2%. For the six months ended June 30, 2016, Pro forma Hotel EBITDA margin increased seven basis points over the comparable period in 2015 to 36.6%.

Pro forma Consolidated Hotel EBITDA includes the results of non-comparable hotels. For the three months ended June 30, 2016, Pro forma Consolidated Hotel EBITDA increased $6.2 million to $123.9 million, representing a 5.3% increase over the comparable period in 2015. For the six months ended June 30, 2016, Pro forma Consolidated Hotel EBITDA increased $12.5 million to $216.3 million, representing a 6.2% increase over the comparable period in 2015.

Adjusted FFO for the three months ended June 30, 2016, increased $4.1 million to $102.1 million, representing a 4.2% increase over the comparable period in 2015. For the six months ended June 30, 2016, Adjusted FFO increased $7.6 million to $172.9 million, representing a 4.6% increase over the comparable period in 2015.

Adjusted FFO per common share and unit-diluted for the three and six months ended June 30, 2016, was $0.82 and $1.39, respectively, based on the Company’s diluted weighted-average number of common shares and units outstanding of 124.5 million and 124.7 million for each period, respectively.

Adjusted EBITDA for the three months ended June 30, 2016, increased $6.7 million to $117.2 million, representing a 6.1% increase over the comparable period in 2015. For the six months ended June 30, 2016, Adjusted EBITDA increased $11.6 million to $203.2 million, representing a 6.1% increase over the comparable period in 2015.

Non-recurring items which were noteworthy for the three months ended June 30, 2016, included a non-cash deferred tax expense of $1.9 million and debt modification and extinguishment costs of $0.6 million.

Non-recurring items are included in net income but are excluded from Adjusted EBITDA and Adjusted FFO, as applicable. A complete listing of non-recurring items is provided in the Non-GAAP reconciliation tables in this press release for the three and six months period ended June 30, 2016 and 2015.

Net cash flow from operating activities for the six months ended June 30, 2016, totaled $164.2 million, compared to $145.9 million for the comparable period in 2015.

Balance Sheet

During the three months ended June 30, 2016, the Company successfully refinanced $800.0 million of unsecured debt.

On April 22, 2016, the Company amended and restated its $400.0 million term loan originally maturing in 2018. The transaction enhanced financial covenants, extended the final maturity to 2021, and improved the pricing by an average of 21 basis points.

The Company also amended and restated its revolving credit facility. The transaction enhanced financial covenants, extended the final maturity from 2017 to 2021, increased the borrowing capacity by an additional $100.0 million to $400.0 million, and improved the pricing by an average of 26 basis points.

As of June 30, 2016, the Company had $160.1 million of unrestricted cash on its balance sheet, $400.0 million available on its revolving credit facility, and $1.6 billion of debt outstanding. The Company’s ratio of net debt to Adjusted EBITDA, pro forma for recent acquisitions and dispositions, for the trailing twelve month period ended June 30, 2016, was 3.7 times.

Dividends

The Company’s Board of Trustees declared a cash dividend of $0.33 per common share of beneficial interest in the second quarter. The dividend was paid on July 15, 2016, to shareholders of record as of June 30, 2016.

Share Buyback

During the second quarter of 2016, the Company repurchased 0.1 million common shares for $2.0 million at an average price per share of $19.80. As of June 30, 2016, the Company’s authorized share buyback program had a remaining capacity of $161.5 million.

Subsequent Events

On July 28, 2016, the Board of Trustees appointed Ross H. Bierkan as President and Chief Executive Officer. Mr. Bierkan has served as Chief Investment Officer since the Company’s formation and will continue to serve in that role. In addition, Mr. Bierkan has been elected to the Company’s Board of Trustees.

The Board of Trustees also appointed Leslie D. Hale as Chief Operating Officer. Ms. Hale will serve in the dual role of Chief Operating Officer and Chief Financial Officer of the Company.

2016 Outlook

The Company’s outlook has been updated to reflect recent macro-economic headwinds and global volatility. The outlook excludes potential future acquisitions and dispositions, which could result in a material change to the Company’s outlook. The 2016 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 assumes the hotels were owned since January 1, 2015. Pro forma guidance removes income from hotels that have been sold.

For the full year 2016, the Company anticipates:

Current Outlook Prior Outlook
Pro forma RevPAR growth (1) 1.5% to 2.5% 3.0% to 5.0%
Pro forma Hotel EBITDA Margin (1) 36.5% to 37.0% 36.5% to 37.5%
Pro forma Consolidated Hotel EBITDA $415.0M to $425.0M $425.0M to $450.0M

(1) Excludes non-comparable hotels.

 

RLJ Lodging Trust

Consolidated Balance Sheets

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

June 30,

2016

December 31,

2015

(unaudited)
Assets
Investment in hotel properties, net $ 3,623,168 $ 3,674,999
Cash and cash equivalents 160,054 134,192
Restricted cash reserves 61,270 55,455
Hotel and other receivables, net of allowance of $146 and $117, respectively 34,286 25,755
Deferred income tax asset 46,950 49,978
Prepaid expense and other assets 34,602 32,563
Total assets $ 3,960,330 $ 3,972,942
Liabilities and Equity
Mortgage loans, net $ 414,800 $ 406,049
Term Loans and Revolver, net 1,168,439 1,169,437
Accounts payable and other liabilities 147,180 129,192
Deferred income tax liability 9,801 9,801
Advance deposits and deferred revenue 11,881 11,647
Accrued interest 3,185 4,883
Distributions payable 41,293 41,409
Total liabilities 1,796,579 1,772,418
Equity
Shareholders’ equity:
Preferred shares of beneficial interest, $0.01 par value, 50,000,000 shares authorized; zero shares issued and outstanding at June 30, 2016 and December 31, 2015, respectively
Common shares of beneficial interest, $0.01 par value, 450,000,000 shares authorized; 124,328,646 and 124,635,675 shares issued and outstanding at June 30, 2016 and December 31, 2015, respectively 1,243 1,246
Additional paid-in-capital 2,187,743 2,195,732
Accumulated other comprehensive loss (42,216 ) (16,602 )
Retained earnings 3,877 2,439
Total shareholders’ equity 2,150,647 2,182,815
Noncontrolling interest:
Noncontrolling interest in consolidated joint venture 5,893 6,177
Noncontrolling interest in the Operating Partnership 7,211 11,532
Total noncontrolling interest 13,104 17,709
Total equity 2,163,751 2,200,524
Total liabilities and equity $ 3,960,330 $ 3,972,942

RLJ Lodging Trust

Consolidated Statements of Operations

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

(unaudited)

For the three months ended

June 30,

For the six months ended

June 30,

2016 2015 2016 2015
Revenue
Operating revenue
Room revenue $ 277,039 $ 262,240 $ 516,552 $ 494,799
Food and beverage revenue 30,047 29,587 56,601 58,580
Other operating department revenue 10,026 9,425 19,130 18,278
Total revenue $ 317,112 $ 301,252 $ 592,283 $ 571,657
Expense
Operating expense
Room expense $ 59,085 $ 55,207 $ 114,113 $ 109,293
Food and beverage expense 20,525 20,492 40,342 41,256
Management and franchise fee expense 32,762 31,677 61,263 59,719
Other operating expense 61,950 59,228 121,971 119,809
Total property operating expense 174,322 166,604 337,689 330,077
Depreciation and amortization 40,849 37,778 81,579 74,981
Property tax, insurance and other 19,302 18,281 39,457 38,324
General and administrative 6,658 10,393 16,307 20,792
Transaction and pursuit costs 80 853 159 988
Total operating expense 241,211 233,909 475,191 465,162
Operating income 75,901 67,343 117,092 106,495
Other (expense) income (326 ) 456 (24 ) 546
Interest income 414 363 810 808
Interest expense (14,789 ) (12,335 ) (29,681 ) (25,843 )
Income from continuing operations before income tax expense 61,200 55,827 88,197 82,006
Income tax expense (2,482 ) (89 ) (3,958 ) (464 )
Income from continuing operations 58,718 55,738 84,239 81,542
Gain (loss) on sale of hotel properties 22 672 (150 ) 22,970
Net income 58,740 56,410 84,089 104,512
Net (income) loss attributable to noncontrolling interests
Noncontrolling interest in consolidated joint venture (37 ) (46 ) 25 23
Noncontrolling interest in the Operating Partnership (256 ) (373 ) (370 ) (694 )
Net income attributable to common shareholders $ 58,447 $ 55,991 $ 83,744 $ 103,841
Basic per common share data:
Net income per share attributable to common shareholders $ 0.47 $ 0.43 $ 0.67 $ 0.79
Weighted-average number of common shares 123,544,034 130,670,629 123,641,928 130,969,957
Diluted per common share data:
Net income per share attributable to common shareholders $ 0.47 $ 0.42 $ 0.67 $ 0.78
Weighted-average number of common shares 123,942,846 131,618,693 124,051,956 131,947,932

Note:

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

RLJ Lodging Trust
Reconciliation of Non-GAAP Measures

(Amounts in thousands, except per share data)

(unaudited)

Funds From Operations (FFO) Attributable to Common Shareholders and Unitholders

For the three months ended

June 30,

For the six months ended

June 30,

2016 2015 2016 2015
Net income $ 58,740 $ 56,410 $ 84,089 $ 104,512
Depreciation and amortization 40,849 37,778 81,579 74,981
(Gain) loss on sale of hotel properties (22 ) (672 ) 150 (22,970 )
Noncontrolling interest in consolidated joint venture (37 ) (46 ) 25 23
Adjustments related to consolidated joint venture (1) (39 ) (43 ) (78 ) (85 )
FFO 99,491 93,427 165,765 156,461
Transaction and pursuit costs 80 853 159 988
Amortization of share-based compensation (2) (578 ) 3,768 2,014 7,791
Non-cash income tax expense 1,897 3,028
Loan related costs (3) 906 7 1,247 97
Other expenses (4) 330 686
Adjusted FFO $ 102,126 $ 98,055 $ 172,899 $ 165,337
Adjusted FFO per common share and unit-basic $ 0.82 $ 0.75 $ 1.39 $ 1.25
Adjusted FFO per common share and unit-diluted $ 0.82 $ 0.74 $ 1.39 $ 1.24
Basic weighted-average common shares and units outstanding (5) 124,103 131,565 124,296 131,864
Diluted weighted-average common shares and units outstanding (5) 124,502 132,513 124,706 132,842

Note:

(1) Includes depreciation and amortization expense allocated to the noncontrolling interest in the joint venture.
(2) For the three and six months ended June 30, 2016, includes the forfeiture of unvested restricted shares upon the resignation of the Company’s President and Chief Executive Officer in May 2016.
(3) Represents debt modification costs, debt extinguishment costs, and accelerated amortization of deferred financing costs.
(4) Represents property-level severance costs.
(5) Includes 0.6 million and 0.9 million weighted average operating partnership units for the three months ended June 30, 2016 and 2015, respectively, and 0.7 million and 0.9 million weighted average operating partnership units for the six months ended June 30, 2016 and 2015, respectively.
RLJ Lodging Trust
Reconciliation of Non-GAAP Measures

(Amounts in thousands)

(unaudited)

Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) Attributable to Common Shareholders and Unitholders

For the three months ended

June 30,

For the six months ended

June 30,

2016 2015 2016 2015
Net income $ 58,740 $ 56,410 $ 84,089 $ 104,512
Depreciation and amortization 40,849 37,778 81,579 74,981
Interest expense, net (1) 14,782 12,327 29,668 25,824
Income tax expense 2,482 89 3,958 464
Noncontrolling interest in consolidated joint venture (37 ) (46 ) 25 23
Adjustments related to consolidated joint venture (2) (39 ) (43 ) (78 ) (85 )
EBITDA 116,777 106,515 199,241 205,719
Transaction and pursuit costs 80 853 159 988
(Gain) loss on sale of hotel properties (22 ) (672 ) 150 (22,970 )
Amortization of share-based compensation (3) (578 ) 3,768 2,014 7,791
Loan related costs (4) 582 924
Other expenses (5) 330 686
Adjusted EBITDA 117,169 110,464 203,174 191,528
General and administrative (6) 7,069 6,625 13,784 13,001
Operating results from noncontrolling interest in joint venture 76 89 53 62
Other corporate adjustments (359 ) (562 ) (623 ) (722 )
Consolidated Hotel EBITDA 123,955 116,616 216,388 203,869
Pro forma adjustments – Income from sold properties (89 ) (1,235 ) (104 ) (3,737 )
Pro forma adjustments – Income from prior ownership (7) 2,247 3,605
Pro forma Consolidated Hotel EBITDA 123,866 117,628 216,284 203,737
Non-comparable hotels (8) (5,328 ) (837 ) (10,093 ) (2,110 )
Pro forma Hotel EBITDA $ 118,538 $ 116,791 $ 206,191 $ 201,627

Note:

(1) Excludes amounts attributable to investment in loans of $0.4 million and $0.8 million for the three and six months ended June 30, 2016, respectively, and $0.4 million and $0.8 million for the three and six months ended June 30, 2015, respectively.
(2) Includes depreciation and amortization expense allocated to the noncontrolling interest in the joint venture.
(3) For the three and six months ended June 30, 2016, includes the forfeiture of unvested restricted shares upon the resignation of the Company’s President and Chief Executive Officer in May 2016.
(4) Represents debt modification costs and debt extinguishment costs.
(5) Represents property-level severance costs.
(6) General and administrative expenses exclude amortization of share based compensation and other non-recurring expenses reflected in Adjusted EBITDA.
(7) Information has not been audited. Reflects unadjusted property-level results provided by the seller of the hotel.
(8) Reflects the results of four non-comparable hotels that were under renovation or not open for the entirety of the comparable periods: Courtyard Waikiki Beach, Courtyard San Francisco Union Square, SpringHill Suites Houston Downtown/Convention Center, and Hyatt Place DC/Downtown/K Street.
RLJ Lodging Trust
Reconciliation of Non-GAAP Measures

(Amounts in thousands)

(unaudited)

Pro forma Hotel EBITDA Margin

For the three months ended

June 30,

For the six months ended

June 30,

2016 2015 2016 2015
Total revenue $ 317,112 $ 301,252 $ 592,283 $ 571,657
Pro forma adjustments – Revenue from sold properties (3,670 ) (170 ) (15,920 )
Pro forma adjustments – Revenue from prior ownership (1) 6,173 9,435
Pro forma adjustments – Other corporate adjustments (15 ) (12 ) (30 ) (27 )
Non-comparable hotels (2) (14,920 ) (7,255 ) (28,934 ) (13,405 )
Pro forma Hotel Revenue $ 302,177 $ 296,488 $ 563,149 $ 551,740
Pro forma Hotel EBITDA $ 118,538 $ 116,791 $ 206,191 $ 201,627
Pro forma Hotel EBITDA Margin 39.2 % 39.4 % 36.6 % 36.5 %

Note:

(1) Information has not been audited. Reflects unadjusted property-level results provided by the seller of the hotel.
(2) Reflects the results of four non-comparable hotels that were under renovation or not open for the entirety of the comparable periods: Courtyard Waikiki Beach, Courtyard San Francisco Union Square, SpringHill Suites Houston Downtown/Convention Center, and Hyatt Place DC/Downtown/K Street.

RLJ Lodging Trust

Consolidated Debt Summary

(Amounts in thousands)

(unaudited)

Loan

Base Term

(Years)

Maturity
(incl. extensions)

Floating /

Fixed

Interest

Rate (1)

Balance as of

June 30, 2016 (2)

Secured Debt
Wells Fargo – 4 hotels 3 Oct 2021 Floating (3) 4.00 % $ 150,000
Wells Fargo – 4 hotels 2 Mar 2022 Floating (3) 4.04 % 147,750
Wells Fargo – 1 hotel (5) 10 Jun 2022 Fixed 5.25 % 32,927
PNC Bank – 5 hotels 5 Mar 2023 Floating 2.57 % 85,000
Weighted Average / Secured Total 3.82 % $ 415,677
Unsecured Debt*
Revolver (6) 4 Apr 2021 Floating 1.97 % $
$400 Million Term Loan Maturing 2019 5 Mar 2019 Floating (3) 2.72 % 400,000
$225 Million Term Loan Maturing 2019 7 Nov 2019 Floating (3) 4.04 % 225,000
$400 Million Term Loan Maturing 2021 5 Apr 2021 Floating (3)(4) 2.91 % 400,000
$150 Million Term Loan Maturing 2022 7 Jan 2022 Floating (3) 3.43 % 150,000
Weighted Average / Unsecured Total 3.12 % $ 1,175,000
Weighted Average / Total Debt 3.31 % $ 1,590,677

Note:

*Term loan names have been redefined since the last reporting period to now include the principal amount and maturity year. For previously reported names, please refer to the Company’s Quarterly Report on Form 10-Q.
(1) Interest rates as of June 30, 2016.
(2) Excludes deferred financing costs.
(3) The floating interest rate is hedged with an interest rate swap.
(4) Reflects interest rate swap on $350.0 million.
(5) Excludes the $1.1 million impact of a fair value adjustment.
(6) There is $400.0 million of borrowing capacity on the Revolver, which is charged an unused commitment fee of 0.30% annually.

RLJ Lodging Trust

Acquisitions

 (unaudited)

Acquisitions Location

Acquisition

Date

Management

Company

Rooms

Gross

Purchase Price

($ in millions)

%

Interest

2016 Acquisitions
No assets acquired to date
2015 Acquisitions
Hyatt Place DC/Downtown/K Street Washington, DC Jul 15, 2015 Aimbridge Hospitality 164 $ 68.0 100 %
Homewood Suites Seattle/Lynnwood Lynnwood, WA Jul 20, 2015 InnVentures 170 37.9 100 %
Residence Inn Palo Alto Los Altos Los Altos, CA Sep 25, 2015 InnVentures 156 70.0 100 %
2015 Total 490 $ 175.9 100 %
Total Acquisitions 490 $ 175.9 100 %
RLJ Lodging Trust
Pro forma Consolidated Hotel EBITDA — Top 60 Assets
Pro forma Consolidated
Property City/State # of Rooms Hotel EBITDA
Marriott Louisville Downtown Louisville, KY 616 $ 16,820
DoubleTree NYC Metropolitan New York, NY 764 14,118
Courtyard Austin Dtwn Conv Ctr Austin, TX 270 9,278
Hilton New York Fashion District New York, NY 280 9,054
Hilton Garden Inn New York W 35th St New York, NY 298 8,561
Courtyard Portland City Center Portland, OR 256 8,118
Embassy Suites Tampa Dtwn Conv Ctr Tampa, FL 360 7,733

DoubleTree Grand Key Resort

Key West, FL 216 6,845
Courtyard Chicago Downtown Mag Mile Chicago, IL 306 6,787
Hyatt House Emeryville SF Bay Area Emeryville, CA 234 6,614
Hilton Garden Inn SF Oakland Bay Bridge Emeryville, CA 278 6,451
Hilton Cabana Miami Beach Miami Beach, FL 231 6,419
Embassy Suites Boston Waltham Waltham, MA 275 6,264
Fairfield Inn & Suites DC Downtown Washington, DC 198 6,156
Renaissance Pittsburgh Hotel Pittsburgh, PA 300 6,122
Residence Inn Palo Alto Los Altos Los Altos, CA 156 6,090
Marriott Denver South @ Park Meadows Lone Tree, CO 279 5,881
Hyatt House San Jose Silicon Valley San Jose, CA 164 5,817
Hyatt House Santa Clara Santa Clara, CA 150 5,805
Courtyard Charleston Historic District Charleston, SC 176 5,475
Residence Inn Austin Dtwn Conv Ctr Austin, TX 179 5,275
Renaissance Ft Lauderdale Plantation Plantation, FL 250 5,263
Marriott Denver Airport @ Gateway Park Aurora, CO 238 5,254
Hilton Garden Inn Los Angeles Hollywood Los Angeles, CA 160 5,207
Embassy Suites Los Angeles Downey Downey, CA 220 5,059
Hilton Garden Inn New Orleans Conv Ctr New Orleans, LA 286 5,030
Residence Inn Bethesda Downtown Bethesda, MD 188 4,639
Homewood Suites Washington DC Downtown Washington, DC 175 4,540
Courtyard Waikiki Beach Honolulu, HI 403 4,402
Hyatt Atlanta Midtown Atlanta, GA 194 4,247
Hyatt Place Fremont Silicon Valley Fremont, CA 151 4,179
Marriott Austin South Austin, TX 211 4,157
Courtyard San Francisco San Francisco, CA 166 4,148
Fairfield Inn & Suites Key West Key West, FL 106 4,084
Courtyard New York Manhattan Upper East New York, NY 226 3,942
Hyatt House San Diego Sorrento Mesa San Diego, CA 193 3,905
Renaissance Boulder Flatiron Hotel Broomfield, CO 232 3,785
Hyatt House Charlotte Center City Charlotte, NC 163 3,629
Hyatt House San Ramon San Ramon, CA 142 3,353
Residence Inn Louisville Downtown Louisville, KY 140 3,339
Hampton Inn Garden City Garden City, NY 143 3,270
Embassy Suites West Palm Beach Central West Palm Beach, FL 194 3,242
Courtyard Houston By The Galleria Houston, TX 190 3,237
Residence Inn Chicago Oak Brook Oak Brook, IL 156 3,235
Residence Inn National Harbor DC Oxon Hill, MD 162 3,232
Residence Inn Indy Dtwn On The Canal Indianapolis, IN 134 3,225
Embassy Suites Irvine Orange Cnty Arprt Irvine, CA 293 3,177
Courtyard Houston Dtwn Conv Ctr Houston, TX 191 3,132
SpringHill Suites Portland Hillsboro Hillsboro, OR 106 3,074
Courtyard Atlanta Buckhead Atlanta, GA 181 3,041
Hyatt Place Madison Downtown Madison, WI 151 2,976
Homewood Suites Seattle Lynnwood Lynnwood, WA 170 2,969
Hyatt House Dallas Lincoln Park Dallas, TX 155 2,937
Hilton Garden Inn Pittsburgh Univ Pl Pittsburgh, PA 202 2,797
Residence Inn Houston Dtwn Conv Ctr Houston, TX 171 2,778
Hyatt Market Street The Woodlands The Woodlands, TX 70 2,717
Courtyard Austin Airport Austin, TX 150 2,708
Hyatt Place Washington DC Dtwn K St Washington, DC 164 2,694
Residence Inn Houston By The Galleria Houston, TX 146 2,670
Hampton Inn Houston Near The Galleria Houston, TX 176 2,653
Top 60 Assets 13,135 301,609
Other (1) 7,700 115,588
Total Portfolio 20,835 $ 417,197

Note: For the trailing twelve months ended June 30, 2016. Information above is unaudited and includes unadjusted property-level results provided by the seller of the hotel prior to the Company’s ownership. Results reflect 100% of DoubleTree NYC Metropolitan financial results, which have not been adjusted to reflect the noncontrolling interest in the joint venture. Amounts in thousands, except rooms. (1) Reflects 65 hotels.

RLJ Lodging Trust
Pro forma Operating Statistics
For the three months ended June 30, 2016
% of
Hotel
Top Markets Occupancy ADR RevPAR EBITDA
# of Hotels 2016 2015 Var 2016 2015 Var 2016 2015 Var Q2
NYC 5 97.0 % 96.8 % 0.2 % $ 244.52 $ 253.39 (3.5 )% $ 237.19 $ 245.29 (3.3 )% 10 %
Austin 13 83.8 % 85.5 % (1.9 )% 169.39 159.77 6.0 % 141.98 136.55 4.0 % 9 %
Northern California 7 90.4 % 88.5 % 2.2 % 210.98 197.81 6.7 % 190.80 175.02 9.0 % 9 %
Chicago 14 75.0 % 77.3 % (3.0 )% 159.36 166.27 (4.2 )% 119.49 128.51 (7.0 )% 8 %
Denver 13 82.0 % 81.9 % 0.2 % 142.43 137.45 3.6 % 116.84 112.51 3.9 % 8 %
Louisville 5 80.2 % 78.7 % 1.9 % 191.91 181.52 5.7 % 153.91 142.80 7.8 % 8 %
DC 7 85.6 % 84.5 % 1.3 % 198.88 195.81 1.6 % 170.28 165.47 2.9 % 7 %
South Florida 10 84.4 % 85.1 % (0.9 )% 152.24 153.48 (0.8 )% 128.47 130.66 (1.7 )% 7 %
Southern California 6 86.7 % 85.3 % 1.7 % 160.19 151.85 5.5 % 138.92 129.53 7.2 % 5 %
Houston 9 70.4 % 72.8 % (3.3 )% 157.64 170.40 (7.5 )% 111.04 124.08 (10.5 )% 5 %
Other 32 81.8 % 79.9 % 2.4 % 161.57 155.54 3.9 % 132.23 124.28 6.4 % 24 %
Total 121 83.1 % 82.8 % 0.4 % $ 174.78 $ 172.09 1.6 % $ 145.18 $ 142.43 1.9 % 100 %
% of
Hotel
Service Level Occupancy ADR RevPAR EBITDA
# of Hotels 2016 2015 Var 2016 2015 Var 2016 2015 Var Q2
Focused-Service 100 82.6 % 82.5 % 0.1 % $ 167.24 $ 163.80 2.1 % $ 138.16 $ 135.12 2.2 % 70 %
Compact Full-Service 20 85.0 % 84.5 % 0.6 % 189.83 189.95 (0.1 )% 161.26 160.46 0.5 % 25 %
Full-Service 1 78.0 % 74.9 % 4.1 % 222.99 215.79 3.3 % 173.83 161.56 7.6 % 5 %
Total 121 83.1 % 82.8 % 0.4 % $ 174.78 $ 172.09 1.6 % $ 145.18 $ 142.43 1.9 % 100 %
% of
Hotel
Chain Scale Occupancy ADR RevPAR EBITDA
# of Hotels 2016 2015 Var 2016 2015 Var 2016 2015 Var Q2
Upper Upscale 18 82.0 % 81.0 % 1.2 % $ 183.91 $ 181.60 1.3 % $ 150.81 $ 147.09 2.5 % 24 %
Upscale 87 84.1 % 83.9 % 0.3 % 173.97 171.13 1.7 % 146.35 143.54 2.0 % 67 %
Upper Midscale 15 79.5 % 80.3 % (1.0 )% 160.78 158.32 1.6 % 127.83 127.19 0.5 % 9 %
Midscale 1 61.8 % 64.6 % (4.4 )% 114.38 121.74 (6.0 )% 70.71 78.70 (10.1 )% %
Total 121 83.1 % 82.8 % 0.4 % $ 174.78 $ 172.09 1.6 % $ 145.18 $ 142.43 1.9 % 100 %
% of
Hotel
Flags Occupancy ADR RevPAR EBITDA
# of Hotels 2016 2015 Var 2016 2015 Var 2016 2015 Var Q2
Courtyard 22 81.8 % 82.0 % (0.2 )% $ 173.61 $ 173.89 (0.2 )% $ 142.08 $ 142.63 (0.4 )% 19 %
Residence Inn 29 84.0 % 83.5 % 0.6 % 158.65 156.22 1.6 % 133.29 130.49 2.1 % 16 %
Marriott 5 79.2 % 76.7 % 3.3 % 185.70 182.04 2.0 % 147.06 139.62 5.3 % 10 %
Hyatt House 11 86.7 % 84.2 % 2.9 % 173.38 163.70 5.9 % 150.32 137.90 9.0 % 9 %
Hilton Garden Inn 9 83.5 % 82.9 % 0.8 % 184.61 181.39 1.8 % 154.20 150.31 2.6 % 9 %
SpringHill Suites 6 84.1 % 83.4 % 0.8 % 167.30 161.60 3.5 % 140.62 134.74 4.4 % 6 %
DoubleTree 3 93.1 % 93.3 % (0.3 )% 226.10 230.64 (2.0 )% 210.50 215.30 (2.2 )% 6 %
Hampton Inn 7 80.7 % 82.8 % (2.6 )% 175.40 170.20 3.1 % 141.59 141.00 0.4 % 4 %
Embassy Suites 7 80.4 % 79.4 % 1.3 % 146.49 145.51 0.7 % 117.77 115.48 2.0 % 4 %
Renaissance 3 78.5 % 80.5 % (2.5 )% 169.75 161.65 5.0 % 133.19 130.16 2.3 % 4 %
Fairfield Inn & Suites 8 80.0 % 82.4 % (2.9 )% 131.35 123.59 6.3 % 105.08 101.78 3.2 % 4 %
Hilton 2 92.6 % 88.4 % 4.8 % 234.23 250.78 (6.6 )% 216.92 221.68 (2.1 )% 3 %
Homewood Suites 2 81.2 % 83.3 % (2.4 )% 206.06 197.53 4.3 % 167.42 164.49 1.8 % 2 %
Hyatt Place 2 88.8 % 89.5 % (0.8 )% 168.71 159.73 5.6 % 149.79 142.94 4.8 % 2 %
Hyatt 2 76.9 % 79.8 % (3.7 )% 201.21 208.41 (3.5 )% 154.64 166.40 (7.1 )% 1 %
Other 3 65.4 % 67.9 % (3.7 )% 157.63 162.14 (2.8 )% 103.03 110.09 (6.4 )% 1 %
Total 121 83.1 % 82.8 % 0.4 % $ 174.78 $ 172.09 1.6 % $ 145.18 $ 142.43 1.9 % 100 %

Note:

Information above is unaudited and includes unadjusted property-level results provided by the seller of the hotel prior to the Company’s ownership. Results reflect 100% of DoubleTree NYC Metropolitan financial results, which have not been adjusted to reflect the noncontrolling interest in the joint venture. All results exclude four non-comparable properties.

RLJ Lodging Trust
Pro forma Operating Statistics
For the six months ended June 30, 2016
% of
Hotel
Top Markets Occupancy ADR RevPAR EBITDA
# of Hotels 2016 2015 Var 2016 2015 Var 2016 2015 Var Q2YTD
South Florida 10 86.7 % 88.4 % (1.9 )% $ 186.15 $ 184.80 0.7 % $ 161.38 $ 163.37 (1.2 )% 11 %
Austin 13 81.6 % 81.7 % % 173.47 167.91 3.3 % 141.60 137.11 3.3 % 10 %
Northern California 7 88.0 % 82.2 % 7.1 % 211.87 192.74 9.9 % 186.44 158.33 17.8 % 10 %
Denver 13 75.3 % 73.8 % 2.0 % 135.85 134.03 1.4 % 102.31 98.92 3.4 % 7 %
Louisville 5 76.9 % 74.5 % 3.3 % 173.25 168.54 2.8 % 133.22 125.51 6.1 % 7 %
DC 7 75.4 % 77.7 % (3.0 )% 188.30 182.29 3.3 % 141.91 141.69 0.2 % 7 %
NYC 5 94.6 % 94.2 % 0.4 % 207.47 213.25 (2.7 )% 196.35 200.94 (2.3 )% 6 %
Chicago 14 64.8 % 69.9 % (7.4 )% 146.70 149.72 (2.0 )% 94.99 104.66 (9.2 )% 6 %
Houston 9 71.3 % 73.5 % (3.0 )% 158.79 169.20 (6.2 )% 113.29 124.43 (9.0 )% 6 %
Southern California 6 84.0 % 81.4 % 3.3 % 159.50 150.60 5.9 % 134.05 122.54 9.4 % 5 %
Other 32 78.0 % 77.1 % 1.2 % 157.85 153.46 2.9 % 123.13 118.30 4.1 % 25 %
Total 121 79.2 % 79.1 % 0.2 % $ 170.41 $ 167.43 1.8 % $ 134.99 $ 132.38 2.0 % 100 %
% of
Hotel
Service Level Occupancy ADR RevPAR EBITDA
# of Hotels 2016 2015 Var 2016 2015 Var 2016 2015 Var Q2YTD
Focused-Service 100 78.4 % 78.2 % 0.3 % $ 163.10 $ 159.37 2.3 % $ 127.86 $ 124.55 2.7 % 70 %
Compact Full-Service 20 82.0 % 82.4 % (0.6 )% 186.96 185.75 0.6 % 153.22 153.10 0.1 % 25 %
Full-Service 1 75.6 % 72.4 % 4.4 % 196.27 194.99 0.7 % 148.32 141.17 5.1 % 5 %
Total 121 79.2 % 79.1 % 0.2 % $ 170.41 $ 167.43 1.8 % $ 134.99 $ 132.38 2.0 % 100 %
% of
Hotel
Chain Scale Occupancy ADR RevPAR EBITDA
# of Hotels 2016 2015 Var 2016 2015 Var 2016 2015 Var Q2YTD
Upper Upscale 18 79.0 % 79.0 % % $ 183.32 $ 180.96 1.3 % $ 144.78 $ 142.98 1.3 % 25 %
Upscale 87 80.1 % 79.5 % 0.7 % 167.97 164.85 1.9 % 134.53 131.08 2.6 % 66 %
Upper Midscale 15 75.3 % 77.1 % (2.4 )% 158.47 155.63 1.8 % 119.28 120.06 (0.7 )% 9 %
Midscale 1 53.0 % 61.7 % (14.2 )% 107.10 103.80 3.2 % 56.73 64.08 (11.5 )% %
Total 121 79.2 % 79.1 % 0.2 % $ 170.41 $ 167.43 1.8 % $ 134.99 $ 132.38 2.0 % 100 %
% of
Hotel
Flags Occupancy ADR RevPAR EBITDA
# of Hotels 2016 2015 Var 2016 2015 Var 2016 2015 Var Q2YTD
Courtyard 22 76.7 % 77.7 % (1.3 )% $ 165.45 $ 166.27 (0.5 )% $ 126.87 $ 129.22 (1.8 )% 17 %
Residence Inn 29 79.3 % 79.1 % 0.3 % 157.84 154.64 2.1 % 125.21 122.33 2.4 % 17 %
Hyatt House 11 85.9 % 78.7 % 9.2 % 172.79 162.13 6.6 % 148.45 127.61 16.3 % 11 %
Marriott 5 75.1 % 73.2 % 2.6 % 173.94 173.18 0.4 % 130.62 126.77 3.0 % 9 %
Hilton Garden Inn 9 79.6 % 80.5 % (1.1 )% 177.08 172.33 2.8 % 141.02 138.71 1.7 % 8 %
SpringHill Suites 6 82.4 % 82.6 % (0.2 )% 178.16 169.66 5.0 % 146.89 140.10 4.8 % 8 %
Hampton Inn 7 77.2 % 79.2 % (2.5 )% 171.40 166.69 2.8 % 132.30 132.01 0.2 % 4 %
DoubleTree 3 90.6 % 90.8 % (0.2 )% 204.04 206.67 (1.3 )% 184.81 187.66 (1.5 )% 4 %
Embassy Suites 7 76.2 % 76.9 % (0.9 )% 145.97 144.82 0.8 % 111.24 111.38 (0.1 )% 4 %
Fairfield Inn & Suites 8 75.7 % 75.9 % (0.3 )% 128.19 123.03 4.2 % 97.02 93.37 3.9 % 4 %
Hilton 2 92.5 % 90.9 % 1.7 % 226.29 239.77 (5.6 )% 209.29 218.01 (4.0 )% 4 %
Renaissance 3 72.2 % 76.4 % (5.5 )% 170.14 164.59 3.4 % 122.88 125.80 (2.3 )% 3 %
Homewood Suites 2 71.5 % 73.9 % (3.3 )% 193.42 185.40 4.3 % 138.30 137.07 0.9 % 2 %
Hyatt Place 2 86.4 % 85.0 % 1.6 % 162.17 153.65 5.5 % 140.10 130.66 7.2 % 2 %
Hyatt 2 75.9 % 77.5 % (2.1 )% 205.11 206.19 (0.5 )% 155.62 159.75 (2.6 )% 2 %
Other 3 58.6 % 64.0 % (8.5 )% 157.20 155.24 1.3 % 92.08 99.36 (7.3 )% 1 %
Total 121 79.2 % 79.1 % 0.2 % $ 170.41 $ 167.43 1.8 % $ 134.99 $ 132.38 2.0 % 100 %
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