Investments in Affiliates

9 Months Ended

Sep. 30, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Investments in Affiliates

Investments in Affiliates

The Company has equity method investments in affiliates primarily related to the Company's program to offer equity support to qualified franchisees to develop and operate Everhome Suites and Cambria Hotels in strategic markets.

As of September 30, 2023 and December 31, 2022, the Company had total investments in affiliates in the consolidated balance sheets of $55.1 million and $30.6 million, respectively, which included investments in affiliates that represent VIEs of $45.3 million and $24.4 million, respectively. The Company has determined that it is not the primary beneficiary of any of these VIEs, however the Company does exercise significant influence through its equity ownership and as a result, the investments in these affiliates are accounted for under the equity method. During the three months ended September 30, 2023 and 2022, the Company recognized losses totaling $0.9 million and $1.1 million, respectively, from these investments that represent VIEs. During the nine months ended September 30, 2023 and 2022, the Company recognized losses totaling $3.2 million and $2.7 million, respectively, from these investments that represent VIEs. The Company's maximum exposure to losses related to its investments in the VIEs is limited to the total of its respective equity investment as well as certain limited payment guaranties, which are described in Note 12 of these consolidated financial statements.

The Company recognized no impairment charges related to its equity method investments during the nine months ended September 30, 2023 and 2022.