Investment in Unconsolidated Entities

12 Months Ended

Dec. 31, 2020

Investment in Unconsolidated Entities [Abstract]

Investment in Unconsolidated Joint Ventures

As of December 31, 2020 and 2019, the Company owned 50% interests in joint ventures that owned two hotel properties. During the year ended December 31, 2020, one of the unconsolidated joint ventures did not exercise its right to extend the term of the ground lease. Accordingly, the ground lease will terminate on October 31, 2021 and the property will revert to the ground lessor at that time. As a result, the Company recorded an impairment loss of $6.5 million to write down the Company's investment in this joint venture. The impairment loss is included in equity in (loss) income from unconsolidated joint ventures in the accompanying consolidated statements of operations and comprehensive (loss) income.

The Company accounts for the investments in these unconsolidated joint ventures under the equity method of accounting. The Company makes adjustments to the equity in (loss) income from unconsolidated joint ventures related to the difference between the Company's basis in the investment in the unconsolidated joint ventures as compared to the historical basis of the assets and liabilities of the joint ventures. As of December 31, 2020 and 2019, the unconsolidated entities' debt consisted entirely of non-recourse mortgage debt.

The following table summarizes the components of the Company's investments in unconsolidated joint ventures (in thousands):


	December 31, 2020		December 31, 2019
Equity basis of the joint venture investments	$	(6,687)	$	(4,236)
Cost of the joint venture investments in excess of the joint venture book value	13,485		19,407
Investment in unconsolidated joint ventures	$	6,798	$	15,171

The following table summarizes the components of the Company's equity in (loss) income from unconsolidated joint ventures (in thousands):


	For the year ended December 31,
	2020		2019		2018
Operating (loss) income	$	(932)	$	1,935	$	2,514
Depreciation of cost in excess of book value	(995)		(1,119)		(1,119)
Impairment loss	(6,546)		—		—
Equity in (loss) income from unconsolidated joint ventures	$	(8,473)	$	816	$	1,395