11.

Acquisitions

We record the assets acquired, liabilities assumed and non-controlling interests issued at the estimated fair value on the date of purchase.

During the first and second quarters of 2011, we acquired the 364-room Hilton Melbourne South Wharf, Australia, for AUD 142 million ($152 million), including the 25% voting interest retained by the previous owners; the 775-room New York Helmsley Hotel for $313.5 million; the 1,625-room Manchester Grand Hyatt San Diego for $572 million; and a portfolio of seven hotels containing 1,207 rooms in New Zealand for approximately $145 million. Acquisition-related costs, such as broker fees, due diligence costs, transfer taxes and legal and accounting fees, are expensed in the period incurred and are not capitalized or applied in determining the fair value of the acquired assets. For these acquisitions, we recorded approximately $4 million of acquisition-related expenses year-to-date. These costs are included in corporate and other expenses on the consolidated statement of operations. The purchase price allocations are estimated based on available information, however, we are still in the process of finalizing our accounting for these transactions.

Additionally, on July 14, 2011, we reached an agreement to acquire the 888-room Grand Hyatt Washington, D.C. for $442 million, which includes a $15 million deposit and may include the assumption of a $166 million mortgage loan. The Grand Hyatt, which includes over 43,000 square feet of meeting space, is centrally located in the nation’s capital. We recently amended the purchase agreement to extend the closing to December 14, 2011, subject to customary closing conditions. To the extent that the transaction does not close, we would lose our $15 million deposit.

The following table summarizes the estimated fair value of the assets acquired and liabilities assumed related to our acquisitions completed in 2011 (in millions):


Property and equipment	$	1,156
Restricted cash, FF&E reserves and other assets		27

Total assets		1,183

Mortgage debt		(86	)
Other liabilities		(6	)

Total net assets acquired	$	1,091

Our summarized unaudited consolidated pro forma results of operations, assuming all of our acquisitions completed during 2010 and 2011 occurred on January 1, 2010, are as follows (in millions, except per share amounts):


	Quarter ended						Year-to-date ended
	September 9, 2011			September 10, 2010			September 9, 2011			September 10, 2010
Revenues	$	1,142		$	1,108		$	3,398		$	3,191
Loss from continuing operations		(32	)		(51	)		(14	)		(120	)
Net loss		(32	)		(50	)		(18	)		(122	)
Host Inc.:
Net loss available to common shareholders	$	(30	)	$	(47	)	$	(18	)	$	(128	)
Basic loss per common share:
Continuing operations	$	(.04	)	$	(.07	)	$	(.02	)	$	(.20	)
Discontinued operations		—			—			(.01	)		—

Basic loss per common share	$	(.04	)	$	(.07	)	$	(.03	)	$	(.20	)

Diluted loss per common share:
Continuing operations	$	(.04	)	$	(.07	)	$	(.02	)	$	(.20	)
Discontinued operations		—			—			(.01	)		—

Diluted loss per common share	$	(.04	)	$	(.07	)	$	(.03	)	$	(.20	)

Host L.P.:
Net loss available to common unitholders	$	(31	)	$	(48	)	$	(18	)	$	(130	)
Basic loss per common unit:
Continuing operations	$	(.04	)	$	(.07	)	$	(.02	)	$	(.20	)
Discontinued operations		—			—			(.01	)		—

Basic loss per common unit	$	(.04	)	$	(.07	)	$	(.03	)	$	(.20	)

Diluted loss per common unit:
Continuing operations	$	(.04	)	$	(.07	)	$	(.02	)	$	(.20	)
Discontinued operations		—			—			(.01	)		—

Diluted loss per common unit	$	(.04	)	$	(.07	)	$	(.03	)	$	(.20	)

The above pro forma results of operations exclude $4 million of acquisition costs for the year-to-date period ended September 9, 2011 and $3 million of acquisition costs for the quarter and year-to-date periods ended September 10, 2010. For the third quarter and year-to-date 2011, we have included approximately $72 million and $128 million of revenues, respectively, and $7 million and $11 million of net income for each of the periods, respectively, in our consolidated statements of operations related to our 2011 acquisitions.