0001511337-15-000037.txt : 20150225 0001511337-15-000037.hdr.sgml : 20150225 20150225172559 ACCESSION NUMBER: 0001511337-15-000037 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20150225 ITEM INFORMATION: Results of Operations and Financial Condition FILED AS OF DATE: 20150225 DATE AS OF CHANGE: 20150225 FILER: COMPANY DATA: COMPANY CONFORMED NAME: RLJ Lodging Trust CENTRAL INDEX KEY: 0001511337 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 000000000 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-35169 FILM NUMBER: 15649049 BUSINESS ADDRESS: STREET 1: 3 BETHESDA METRO CENTER STREET 2: SUITE 1000 CITY: BETHESDA STATE: MD ZIP: 20814 BUSINESS PHONE: 301-280-7777 MAIL ADDRESS: STREET 1: 3 BETHESDA METRO CENTER STREET 2: SUITE 1000 CITY: BETHESDA STATE: MD ZIP: 20814 8-K 1 rljq42014earningsrelease.htm 8-K RLJ Q4 2014 earnings release


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): February 25, 2015
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 February 25, 2015, RLJ Lodging Trust (the “Company”) issued a press release announcing its financial results for the quarter and year ended December 31, 2014.  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 February 25, 2015, issued by RLJ Lodging Trust, providing financial results for the quarter and year ended December 31, 2014.
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
 
 
Dated: February 25, 2015
By:
/s/ Thomas J. Baltimore, Jr.
 
 
Thomas J. Baltimore, Jr.
 
 
President, Chief Executive Officer and Trustee
EXHIBIT LIST
 
Exhibit
Number
 
Description
99.1

 
Press release dated February 25, 2015, issued by RLJ Lodging Trust, providing financial results for the quarter and year ended December 31, 2014.



 EX-99.1 2 rljexhibit991q42014.htm EXHIBIT 99.1 RLJ Exhibit 99.1 Q4 2014

 
Press Release
 

RLJ Lodging Trust Reports Fourth Quarter
and Full Year 2014 Results

- Full year Pro forma RevPAR increased 7.2%
- Acquired more than $630 million of properties in high-growth markets
- Sold more than $135 million of non-strategic properties

 
Bethesda, MD, February 25, 2015 – RLJ Lodging Trust (the “Company”) (NYSE: RLJ) today reported results for the quarter and year ended December 31, 2014.
 
Full Year Highlights
•
Pro forma RevPAR increased 7.2%, Pro forma ADR increased 3.9% and Pro forma Occupancy increased 3.1%
•
Pro forma Hotel EBITDA Margin increased 114 basis points to 35.6%
•
Pro forma Consolidated Hotel EBITDA increased 10.8% to $405.0 million
•
Adjusted FFO increased 26.0% to $310.7 million
•
Acquired 15 properties in high-growth markets for over $630.0 million
•
Sold 18 non-strategic properties for more than $135.0 million
•
Completed a follow-on equity offering with net proceeds of $232.7 million
•
Upsized term loans by $175.0 million and staggered debt maturities with two key refinancing transactions totaling $293.0 million
•
Declared an aggregate cash dividend of $1.04 per share, representing an increase of approximately 21.6% over the prior year


Fourth Quarter Highlights
•
Pro forma RevPAR increased 6.0%, Pro forma ADR increased 4.6% and Pro forma Occupancy increased 1.3%
•
Pro forma Hotel EBITDA Margin increased 152 basis points to 34.9%
•
Pro forma Consolidated Hotel EBITDA increased 11.3% to $97.0 million
•
Adjusted FFO increased 21.4% to $76.1 million

“This year marks our fourth consecutive year of RevPAR growth of more than 7.0%,” commented Thomas J. Baltimore, Jr., President and Chief Executive Officer. “We have optimized our portfolio's growth through a highly disciplined investment strategy. We are encouraged by our momentum as well as the positive growth in the economy and therefore look forward to another positive year of lodging fundamentals and another solid year of growth for RLJ.”




1

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 and also exclude hotels sold during the period 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 quarter ended December 31, 2014, increased 6.0% over the comparable period in 2013, driven by a Pro forma ADR increase of 4.6% and a Pro forma Occupancy increase of 1.3%. Among the Company’s top six markets, the best performing markets during the quarter were Houston and Chicago, which experienced RevPAR growth of 8.1% and 7.7%, respectively. For the year ended December 31, 2014, Pro forma RevPAR increased 7.2% over the comparable period in 2013, driven by a Pro forma ADR increase of 3.9% and a Pro forma Occupancy increase of 3.1%.

Pro forma Hotel EBITDA Margin for the quarter ended December 31, 2014, increased 152 basis points over the comparable period in 2013 to 34.9%. For the year ended December 31, 2014, Pro forma Hotel EBITDA Margin increased 114 basis points over the comparable period in 2013 to 35.6%, adjusted for the non-comparable Courtyard Waikiki Beach 2013 ground rent.

Pro forma Consolidated Hotel EBITDA includes the results of non-comparable hotels. For the quarter ended December 31, 2014, Pro forma Consolidated Hotel EBITDA increased $9.9 million to $97.0 million, representing an 11.3% increase over the comparable period in 2013. For the year ended December 31, 2014, Pro forma Consolidated Hotel EBITDA increased $39.6 million to $405.0 million, representing a 10.8% increase over the comparable period in 2013, adjusted for the non-comparable Courtyard Waikiki Beach 2013 ground rent.
 
Adjusted EBITDA for the quarter ended December 31, 2014, increased $13.3 million to $90.3 million, representing a 17.3% increase over the comparable period in 2013. For the year ended December 31, 2014, Adjusted EBITDA increased $55.8 million to $366.9 million, representing an increase of 17.9% over the comparable period in 2013.
 
Adjusted FFO for the quarter ended December 31, 2014, increased $13.4 million to $76.1 million, representing a 21.4% increase over the comparable period in 2013. For the year ended December 31, 2014, Adjusted FFO increased $64.1 million to $310.7 million, representing a 26.0% increase over the comparable period in 2013.

Adjusted FFO per diluted share and unit for the quarter and year ended December 31, 2014, was $0.57 and $2.41, respectively, based on the Company’s diluted weighted-average common shares and units outstanding of 133.1 million and 129.2 million for each period, respectively.

Net income attributable to common shareholders for the quarter ended December 31, 2014, was $33.8 million compared to $27.4 million in the comparable period in 2013. For the year ended December 31, 2014, net income attributable to common shareholders was $135.4 million compared to $112.9 million in the comparable period in 2013.


2

Net cash flow from operating activities for the year ended December 31, 2014, totaled $298.8 million compared to $251.4 million for the comparable period in 2013.


Acquisitions
During the year ended December 31, 2014, the Company acquired 15 hotels for a gross purchase price of more than $630.0 million: a 1,560-room 10-hotel portfolio, the 256-room Courtyard Portland City Center, the 293-room Embassy Suites Irvine Orange County, the 231-room Hilton Cabana Miami Beach, the 194-room Hyatt Atlanta Midtown, and the 215-room DoubleTree Grand Key Resort.

On March 12, 2014, the Company acquired 10 Hyatt, Hyatt Place, and Hyatt House-branded
hotels totaling 1,560 rooms for $312.5 million, or approximately $200,000 per
key, from affiliates of Hyatt Hotels Corporation.

On May 22, 2014, the Company acquired two hotels located on the West Coast: the 256-room
Courtyard Portland City Center in Portland, Oregon, and the 293-room Embassy Suites Irvine Orange County in Irvine, California, for $120.0 million, or approximately $219,000 per key.

On June 19, 2014, the Company completed the acquisition of the 231-room Hilton Cabana Miami Beach in Miami Beach, Florida, for $71.7 million, or approximately $310,000 per key.

On July 14, 2014, the Company acquired the 194-room Hyatt Atlanta Midtown in Atlanta, Georgia, for $49.5 million, or approximately $255,000 per key.

On September 11, 2014, the Company acquired the 215-room DoubleTree Grand Key Resort in Key West, Florida, for $77.0 million, or approximately $358,000 per key.


Dispositions
During the year ended December 31, 2014, the Company sold 18 hotels for more than $135.0 million: a 1,205-room 11-hotel portfolio, the 150-room Hilton Garden Inn St. George, the 182-room Hilton Mystic, the 194-room Holiday Inn Austin, and four other hotels totaling 463 rooms.

On February 20, 2014, the Company sold an 11-hotel portfolio consisting of 1,205 rooms for
$84.8 million.

On February 25, 2014, the Company sold the 150-room Hilton Garden Inn St. George in St.
George, Utah, for $15.7 million.

On March 26, 2014, the Company sold the 182-room Hilton Mystic in Mystic, Connecticut, for
$14.1 million.

On June 18, 2014, the Company sold the 194-room Holiday Inn Austin NW Arboretum Area in
Austin, Texas, for $13.5 million.

3

In December 2014, the Company sold the 98-room Courtyard Benton Harbor St. Joseph, the 142-room Courtyard Fort Wayne, the 112-room Courtyard Merrillville, and the 111-room Courtyard Valparaiso in four separate transactions for an aggregate sale price of approximately $9.8 million.


Subsequent Events
On February 23, 2015, the Company sold a portfolio of 20 hotels totaling 2,461 rooms for approximately $230.3 million.


Balance Sheet
In March 2014, the Company amended its credit agreement to extend the maturity date of its 2012 Five-Year Term Loan to 2019, expand the accordion feature, and reduce the applicable margin by 15 basis points. The Company also exercised the accordion feature of its 2012 Five-Year Term Loan and 2013 Five-Year Term Loan, resulting in proceeds of $175.0 million.

In May 2014, the Company completed an underwritten public offering of 9,200,000 common shares at a public offering price of $26.45 per share. Net proceeds from the public offering after deducting the underwriting discount and other offering costs were approximately $232.7 million.

In the fourth quarter, the Company completed two financing transactions and addressed its near term debt maturities. In October 2014, the Company originated four separate first mortgage loans totaling $143.0 million, and used the proceeds to retire five mortgage loans. In December 2014, the Company entered into a new $150.0 million unsecured Seven-Year Term Loan facility that is expected to be fully drawn by the end of second quarter 2015.

As of December 31, 2014, the Company had $262.5 million of unrestricted cash on its balance sheet, $300.0 million available on its revolving credit facility, and $1.6 billion of debt outstanding. The Company’s ratio of net debt to Adjusted EBITDA for the year ended December 31, 2014, was 3.5 times.


Dividends
The Company’s Board of Trustees declared a cash dividend of $0.30 per common share of beneficial interest in the fourth quarter. The dividend was paid on January 15, 2015, to shareholders of record as of December 31, 2014.

For the year ended December 31, 2014, the Company distributed a total dividend of $1.04 per common share of beneficial interest, representing an increase of approximately 21.6% over the prior year’s annual distribution.





4

2015 Outlook
The Company’s outlook does not include operational results from the 24 dispositions that it announced this week. The outlook also excludes potential future acquisitions and dispositions, which could result in a material change to the outlook. The Company's 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, 2014. For the full year 2015, the Company anticipates:

 
Current Outlook
Pro forma RevPAR growth (1)
5.0% to 6.75%
Pro forma Hotel EBITDA Margin (1)
36.0% to 37.0%
Pro forma Consolidated Hotel EBITDA
$405.0M to $425.0M
Corporate Cash General and Administrative expenses
$26.0M to $27.0M
(1) Excludes non-comparable hotels. Properties closed for renovations are considered non-comparable and therefore are excluded from periods in which they are closed.
 

Earnings Call
The Company will conduct its quarterly analyst and investor conference call on February 26, 2015, at 10:00 a.m. (Eastern Time). The conference call can be accessed by dialing (877) 407-3982 or (201) 493-6780 for international participants and requesting RLJ Lodging Trust’s fourth 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 webcast 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 126 properties, comprised of 124 hotels with more than 20,400 rooms and two planned hotel conversions, located in 21 states and the District of Columbia.
 

5

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 these forward-looking statements and urges 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

6

RLJ Lodging Trust
Non-GAAP and Accounting Commentary
 
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 unitholders 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

7

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.

Hotel EBITDA
With respect to Hotel EBITDA, the Company believes that excluding the effect of corporate-level expenses and non-cash items provide 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.
 
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 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, FFO and EBITDA, is beneficial to an investor’s understanding of its operating performance. The Company adjusts FFO and EBITDA 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.
•
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. The Company has excluded the amortization of share based compensation, non-cash gain on the disposal of hotel properties, non-cash gain on the extinguishment of indebtedness, non-cash gain on foreclosure, the accelerated amortization of deferred management and financing fees, and impairment loss.
•
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. The Company has excluded the loss on defeasance, expenses related to the accelerated payoff of mortgage indebtedness, and legal expenses it considered outside the normal course of business.

New Accounting Treatment for Discontinued Operations
The Company adopted Financial Accounting Standards Board Accounting Standards Update 2014-08, Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity. Going forward, the Company will only classify dispositions as discontinued operations if they represent a strategic shift in operations (e.g., disposal of a major line of business). The 18 assets sold during the year ended December 31, 2014, do not represent a strategic shift in operations for the Company.


8

RLJ Lodging Trust
Consolidated Balance Sheets
(Amounts in thousands, except share and per share data)
 
December 31,
2014
 
December 31, 2013
Assets
 

 
 

Investment in hotel and other properties, net
$
3,518,803

 
$
3,241,163

Cash and cash equivalents
262,458

 
332,248

Restricted cash reserves
63,054

 
62,430

Hotel and other receivables, net of allowance of $166 and $234, respectively
25,691

 
22,762

Deferred financing costs, net
11,421

 
11,599

Deferred income tax asset
7,502

 
2,529

Purchase deposits
—

 
7,246

Prepaid expense and other assets
42,115

 
37,997

Assets of hotel properties held for sale
197,335

 
—

Total assets
$
4,128,379

 
$
3,717,974

Liabilities and Equity
 

 
 

Mortgage loans
$
532,747

 
$
559,665

Term loans
1,025,000

 
850,000

Accounts payable and other liabilities
129,388

 
115,011

Deferred income tax liability
7,879

 
3,548

Advance deposits and deferred revenue
9,984

 
9,851

Accrued interest
2,783

 
2,695

Distributions payable
42,114

 
30,870

Total liabilities
1,749,895

 
1,571,640

Equity
 

 
 

Shareholders’ equity:
 

 
 

Preferred shares of beneficial interest, $0.01 par value, 50,000,000 shares authorized; zero shares issued and outstanding at December 31, 2014 and 2013, respectively.
—

 
—

Common shares of beneficial interest, $0.01 par value, 450,000,000 shares authorized; 131,964,706 and 122,640,042 shares issued and outstanding at December 31, 2014 and 2013, respectively.
1,319

 
1,226

Additional paid-in-capital
2,419,731

 
2,178,004

Accumulated other comprehensive loss
(13,644
)
 
(5,941
)
Distributions in excess of net earnings
(46,415
)
 
(45,522
)
Total shareholders’ equity
2,360,991

 
2,127,767

Noncontrolling interest:
 

 
 

Noncontrolling interest in joint venture
6,295

 
7,306

Noncontrolling interest in Operating Partnership
11,198

 
11,261

Total noncontrolling interest
17,493

 
18,567

Total equity
2,378,484

 
2,146,334

Total liabilities and equity
$
4,128,379

 
$
3,717,974


9

RLJ Lodging Trust
Consolidated Statements of Operations
(Amounts in thousands, except share and per share data)
 
For the quarter ended December 31,
 
For the year ended December 31,
 
2014
 
2013
 
2014
 
2013
 
(unaudited)
 
(unaudited)
 
 
 
 
Revenue
 
 
 
 
 

 
 

Operating revenue
 
 
 
 
 

 
 

Room revenue
$
242,035

 
$
209,584

 
$
969,402

 
$
844,741

Food and beverage revenue
29,614

 
25,877

 
107,538

 
97,083

Other operating department revenue
8,462

 
7,110

 
32,257

 
28,556

Total revenue
$
280,111

 
$
242,571

 
$
1,109,197

 
$
970,380

Expense
 
 
 

 
 

 
 

Operating expense
 
 
 

 
 

 
 

Room expense
$
54,402

 
$
47,117

 
$
213,071

 
$
186,667

Food and beverage expense
20,452

 
17,539

 
75,468

 
67,945

Management fee expense
10,591

 
9,432

 
43,230

 
34,956

Other operating expense
80,295

 
71,620

 
314,576

 
285,539

Total property operating expense
165,740

 
145,708

 
646,345

 
575,107

Depreciation and amortization
38,753

 
32,483

 
144,294

 
127,231

Impairment loss
—

 
—

 
9,200

 
—

Property tax, insurance and other
18,379

 
15,754

 
71,443

 
63,627

General and administrative
10,378

 
8,627

 
41,671

 
35,466

Transaction and pursuit costs
475

 
1,588

 
4,850

 
4,410

Total operating expense
233,725

 
204,160

 
917,803

 
805,841

Operating income
46,386

 
38,411

 
191,394

 
164,539

Other income
244

 
569

 
807

 
903

Interest income
259

 
888

 
1,881

 
1,665

Interest expense
(14,164
)
 
(14,178
)
 
(56,810
)
 
(64,348
)
Gain on foreclosure
—

 
32

 
—

 
4,863

Income from continuing operations before income tax expense
32,725

 
25,722

 
137,272


107,622

Income tax expense
17

 
(127
)
 
(1,145
)
 
(879
)
Income from continuing operations
32,742

 
25,595

 
136,127

 
106,743

Income (loss) from discontinued operations
—

 
2,087

 
—

 
7,436

Gain on disposal of hotel properties
1,328

 
—

 
353

 
—

Net income
34,070

 
27,682

 
136,480

 
114,179

Net (income) loss attributable to noncontrolling interests
 
 
 

 
 

 
 

Noncontrolling interest in consolidated joint venture
(69
)
 
(219
)
 
(171
)
 
(540
)
Noncontrolling interest in the Operating Partnership
(156
)
 
(18
)
 
(868
)
 
(718
)
Net income attributable to common shareholders
$
33,845

 
$
27,445

 
$
135,441

 
$
112,921

Basic per common share data:
 
 
 
 
 

 
 

Net income per share attributable to common shareholders before discontinued operations
$
0.26

 
$
0.21

 
$
1.06

 
$
0.89

Discontinued operations
—

 
0.01

 
—

 
0.06

Net income per share attributable to common shareholders
$
0.26

 
$
0.22

 
$
1.06

 
$
0.95

Weighted-average number of common shares
131,189,673

 
121,667,166

 
127,360,669

 
117,950,066

Diluted per common share data:
 
 
 
 
 

 
 

Net income per share attributable to common shareholders before discontinued operations
$
0.25

 
$
0.21

 
$
1.05

 
$
0.88

Discontinued operations
—

 
0.01

 
—

 
0.06

Net income per share attributable to common shareholders
$
0.25

 
$
0.22

 
$
1.05

 
$
0.94

Weighted-average number of common shares
132,186,832

 
122,540,253

 
128,293,843

 
118,738,626

 
Note:
The Statement of Comprehensive Income and corresponding footnotes can be found in the Company’s Annual Report on Form 10-K.

10

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 quarter ended
December 31,
 
For the year ended
December 31,
 
2014
 
2013
 
2014
 
2013
Net income (1)
$
34,070

 
$
27,682

 
$
136,480

 
$
114,179

Gain on disposal of hotel properties
(1,328
)
 
(2,081
)
 
(353
)
 
(2,081
)
Depreciation and amortization
38,753

 
32,483

 
144,294

 
127,231

Gain on extinguishment of indebtedness (2)
—

 
(6
)
 
—

 
(5,708
)
Impairment loss
—

 
—

 
9,200

 
—

Noncontrolling interest in joint venture
(69
)
 
(219
)
 
(171
)
 
(540
)
Adjustments related to discontinued operations (3)
—

 
8

 
—

 
199

Adjustments related to joint venture (4)
(47
)
 
(121
)
 
(186
)
 
(484
)
FFO attributable to common shareholders
71,379

 
57,746

 
289,264

 
232,796

Gain on foreclosure
—

 
(32
)
 
—

 
(4,863
)
Transaction and pursuit costs
475

 
1,588

 
4,850

 
4,410

Amortization of share based compensation
3,844

 
3,386

 
15,088

 
13,078

Loan related costs (5)(6)
—

 
—

 
1,073

 
1,046

Other expenses (7)(8)
432

 
—

 
432

 
157

Adjusted FFO
$
76,130

 
$
62,688

 
$
310,707

 
$
246,624

 
 
 
 
 
 
 
 
Adjusted FFO per common share and unit-basic
$
0.58

 
$
0.51

 
$
2.42

 
$
2.08

Adjusted FFO per common share and unit-diluted
$
0.57

 
$
0.51

 
$
2.41

 
$
2.06

 
 
 
 
 
 
 
 
Basic weighted-average common shares and units outstanding (9)
132,084

 
122,561

 
128,255

 
118,844

Diluted weighted-average common shares and units outstanding (9)
133,081

 
123,434

 
129,188

 
119,633

 
Note:
(1)
Includes net income from discontinued operations for the quarter and year ended December 31, 2013.
(2)
Includes the gain on extinguishment of indebtedness from the SpringHill Suites Southfield, Michigan, and Courtyard Goshen, Indiana.
(3)
Includes depreciation and amortization expense from discontinued operations.
(4)
Includes depreciation and amortization expense allocated to the noncontrolling interest in joint venture.
(5)
Includes $1.0 million for the year ended December 31, 2013, of accelerated amortization of deferred financing fees related to the amendment and restatement of our credit facility.
(6)
Includes $1.1 million for the year ended December 31, 2014, of expenses related to the accelerated payoff of mortgage indebtedness.
(7)
Includes $0.1 million for the year ended December 31, 2013, of accelerated amortization of deferred management fees.
(8)
Includes $0.4 million for the quarter and year ended December 31, 2014, and less than $0.1 million for the year ended December 31, 2013, of legal and other expenses outside the normal course of operations.
(9)
Includes 0.9 million operating partnership units.

11

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 quarter ended
December 31,
 
For the year ended
 December 31,
 
2014
 
2013
 
2014
 
2013
Net income (1)
$
34,070

 
$
27,682

 
$
136,480

 
$
114,179

Depreciation and amortization
38,753

 
32,483

 
144,294

 
127,231

Interest expense, net (2)
14,153

 
14,168

 
56,144

 
64,317

Income tax expense
(17
)
 
127

 
1,145

 
879

Noncontrolling interest in joint venture
(69
)
 
(219
)
 
(171
)
 
(540
)
Adjustments related to discontinued operations (3)
—

 
9

 
—

 
572

Adjustments related to joint venture (4)
(47
)
 
(121
)
 
(186
)
 
(484
)
EBITDA
86,843

 
74,129

 
337,706

 
306,154

Transaction and pursuit costs
475

 
1,588

 
4,850

 
4,410

Gain on sale of property
(1,328
)
 
(2,081
)
 
(353
)
 
(2,081
)
Gain on foreclosure
—

 
(32
)
 
—

 
(4,863
)
Gain on extinguishment of indebtedness (5)
—

 
(6
)
 
—

 
(5,708
)
Impairment loss
—

 
—

 
9,200

 
—

Amortization of share based compensation
3,844

 
3,386

 
15,088

 
13,078

Other expenses (6)(7)
432

 
—

 
432

 
157

Adjusted EBITDA
$
90,266

 
$
76,984

 
$
366,923

 
$
311,147

General and administrative (8)
6,534

 
5,241

 
26,583

 
22,389

Operating results from noncontrolling interest in joint venture
116

 
340

 
357

 
1,024

Residential income
(26
)
 
(101
)
 
—

 
(521
)
Pro forma adjustments (9)
—

 
8,861

 
12,176

 
46,815

Income from sold properties
(2
)
 
(3,685
)
 
(1,183
)
 
(15,350
)
Other corporate adjustments
149

 
(475
)
 
97

 
(143
)
Pro forma Consolidated Hotel EBITDA
$
97,037

 
$
87,165

 
$
404,953

 
$
365,361

Non-comparable hotels (10)
(2,313
)
 
(1,340
)
 
(4,423
)
 
(1,982
)
Pro forma Hotel EBITDA
$
94,724

 
$
85,825

 
$
400,530

 
$
363,379

Note:
(1)
Includes net income from discontinued operations for the quarter and year ended December 31, 2013.
(2)
Excludes amounts attributable to investment in loans of $0.2 million and $1.2 million for the quarter and year ended December 31, 2014, respectively, and $0.9 million and $1.6 million for the quarter and year ended December 31, 2013, respectively.
(3)
Includes depreciation, amortization and interest expense related to discontinued operations.
(4)
Includes depreciation, amortization and interest expense allocated to the noncontrolling interest in the joint venture.
(5)
Includes the gain on extinguishment of indebtedness from the SpringHill Suites Southfield, Michigan, and Courtyard Goshen, Indiana.
(6)
Includes $0.1 million for the year ended December 31, 2013, of accelerated amortization of deferred management fees.
(7)
Includes $0.4 million for the quarter and year ended December 31, 2014, and less than $0.1 million for the year ended December 31, 2013, of legal and other expenses outside the normal course of operations.
(8)
General and administrative expenses exclude amortization of share based compensation, which is reflected in Adjusted EBITDA.
(9)
Reflects prior ownership results of recent acquisitions and normalizes ground rent for Courtyard Waikiki Beach. For the year ended December 31, 2013, Pro forma Hotel EBITDA for Courtyard Waikiki Beach was reduced by $1.6 million.
(10)
Reflects the results of Residence Inn Atlanta Midtown/Georgia Tech, Hyatt Atlanta Midtown, and Hilton Cabana Miami Beach, which were not open for the entirety of the comparable periods. Also reflects the results of Fairfield Inn & Suites Key West during the six months ended December 31, 2014 and 2013, since it was closed for a comprehensive renovation during Q3 and Q4 2014.

12

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 December 31, 2014
Secured Debt
 
 
 
 
 
 
Capmark Financial Group - 1 hotel
10
May 2015
Fixed (2)
5.55
%
 
$
10,513

Capmark Financial Group - 1 hotel
10
Jun 2015
Fixed (2)
5.55
%
 
4,561

Barclays Bank - 12 hotels
10
Jun 2015
Fixed (2)
5.55
%
 
107,544

Barclays Bank - 4 hotels
10
Jun 2015
Fixed (2)
5.60
%
 
26,775

Capmark Financial Group - 1 hotel
10
Jul 2015
Fixed (2)
5.50
%
 
6,214

Barclays Bank - 1 hotel
10
Sep 2015
Fixed (2)
5.44
%
 
10,140

PNC Bank - 5 hotels
4
May 2017
Floating
2.51
%
 
74,000

Wells Fargo - 4 hotels
3
Sep 2020
Floating (3)
4.19
%
 
150,000

Wells Fargo - 4 hotels
3
Oct 2021
Floating (3)
4.06
%
 
143,000

Weighted Average / Total Secured
 
 
 
4.34
%
 
$
532,747

 
 
 
 
 
 
 
Unsecured Debt
 
 
 
 
 
 
Credit Facility
4
Nov 2017
Floating
—
%
 
$
—

2013 Five-Year Term Loan
5
Aug 2018
Floating (3) (4)
3.07
%
 
400,000

2012 Five-Year Term Loan
5
Mar 2019
Floating (3) (5)
2.37
%
 
400,000

2012 Seven-Year Term Loan
7
Nov 2019
Floating (3)
4.04
%
 
225,000

2014 Seven-Year Term Loan
7
Jan 2022
Floating
—
%
 
—

Weighted Average / Total Unsecured
 
 
 
3.01
%
 
$
1,025,000

 
 
 
 
 
 
 
Weighted Average / Total Debt
 
 
 
3.47
%
 
$
1,557,747

 
 
 
 
 
 
 
Note:
(1)
Interest rates as of December 31, 2014.
(2)
The Company plans to use a combination of cash on hand and the proceeds from the 2014 Seven-Year Term Loan to repay these loans.
(3)
Interest rate gives effect to interest rate hedges.
(4)
Reflects interest rate swap on $350.0 million.
(5)
Reflects interest rate swap on $275.0 million.

13

RLJ Lodging Trust
Acquisitions
 (unaudited)

2014 Acquisitions
Location
Acquisition Date
Management Company
Rooms
Gross Purchase Price
($ in millions) (1)
Hyatt House Charlotte Center City
Charlotte, NC
Mar 12, 2014
Hyatt Affiliate
163

$
32.5

Hyatt House Cypress Anaheim
Cypress, CA
Mar 12, 2014
Hyatt Affiliate
142

14.8

Hyatt House Emeryville SF Bay Area
Emeryville, CA
Mar 12, 2014
Hyatt Affiliate
234

39.3

Hyatt House San Diego Sorrento Mesa
San Diego, CA
Mar 12, 2014
Hyatt Affiliate
193

36.0

Hyatt House San Jose Silicon Valley
San Jose, CA
Mar 12, 2014
Hyatt Affiliate
164

44.2

Hyatt House San Ramon
San Ramon, CA
Mar 12, 2014
Hyatt Affiliate
142

20.8

Hyatt House Santa Clara
Santa Clara, CA
Mar 12, 2014
Hyatt Affiliate
150

40.6

Hyatt Market Street The Woodlands
The Woodlands, TX
Mar 12, 2014
Hyatt Corporation
70

25.8

Hyatt Place Fremont Silicon Valley
Fremont, CA
Mar 12, 2014
Hyatt Affiliate
151

23.5

Hyatt Place Madison Downtown
Madison, WI
Mar 12, 2014
Hyatt Affiliate
151

35.1

Courtyard Portland City Center
Portland, OR
May 22, 2014
Sage Hospitality
256

67.0

Embassy Suites Irvine Orange County
Irvine, CA
May 22, 2014
Sage Hospitality
293

53.0

Hilton Cabana Miami Beach
Miami, FL
Jun 19, 2014
Highgate Hotels
231

71.7

Hyatt Atlanta Midtown
Atlanta, GA
Jul 14, 2014
Interstate Hotels and Resorts
194

49.5

DoubleTree Grand Key Resort (2)
Key West, FL
Sep 11, 2014
Interstate Hotels and Resorts
215

77.0

Total Acquisitions
 
 
 
2,749

$
630.7

 
 
 
 
 
 
2013 Acquisitions
Location
Acquisition Date
Management Company
Rooms
Gross Purchase Price
($ in millions) (1)
Courtyard Houston Downtown Convention Center
Houston, TX
Mar 19, 2013
White Lodging Services
191

$
34.4

Residence Inn Houston Downtown Convention Center
Houston, TX
Mar 19, 2013
White Lodging Services
171

29.5

SpringHill Suites Houston Downtown Convention Center (3)
Houston, TX
Mar 19, 2013
N/A
82

15.6

Courtyard Waikiki Beach
Honolulu, HI
Jun 17, 2013
Highgate Hotels
399

75.3

Courtyard San Francisco (4)
San Francisco, CA
Jun 21, 2013
N/A
150

29.5

Residence Inn Atlanta Midtown/Georgia Tech (5)
Atlanta, GA
Aug 6, 2013
Interstate Hotels and Resorts
78

5.0

SpringHill Suites Portland Hillsboro
Hillsboro, OR
Oct 8, 2013
InnVentures
106

24.0

Total Acquisitions
 
 
 
1,177

$
213.3

 
 
 
 
 
 
 
 
 
 
 
 
 
Note:
(1)
Gross purchase price does not include net closing adjustments. Please refer to the 10-K for the net purchase price.
(2)
Purchase price does not include $1.3 million paid for five condominium units.
(3)
This property is currently not open for operations. Conversion to a SpringHill Suites is in progress.
(4)
This property is currently not open for operations. Conversion to a Courtyard by Marriott is in progress.
(5)
The Company was the successful bidder at a foreclosure sale of the property collateralizing the non-performing loan. The purchase price equates to the original amount paid for the mortgage note in November 2009. In October 2014, the property reopened after a comprehensive renovation as a 90-room hotel.


14

RLJ Lodging Trust
Pro forma Operating Statistics — Top 50 Assets
(Amounts in thousands, except rooms)
(unaudited)
 
For the year ended December 31, 2014
Property
City/State
 # of Rooms

EBITDA
DoubleTree NYC Metropolitan
New York, NY
764

$
18,805

Marriott Louisville Downtown
Louisville, KY
616

15,726

Hilton New York Fashion District
New York, NY
280

10,352

Hilton Garden Inn New York W 35th St
New York, NY
298

10,229

Courtyard Austin Dtwn Conv Ctr
Austin, TX
270

9,994

Courtyard Chicago Downtown Mag Mile
Chicago, IL
306

6,944

Courtyard Portland City Center
Portland, OR
256

6,629

Courtyard Waikiki Beach
Honolulu, HI
403

6,540

Fairfield Inn & Suites DC Downtown
Washington, DC
198

6,100

Renaissance Pittsburgh Hotel
Pittsburgh, PA
300

6,013

Embassy Suites Tampa Dtwn Conv Ctr
Tampa, FL
360

5,986

Residence Inn Austin Dtwn Conv Ctr
Austin, TX
179

5,389

Hilton Garden Inn SF Oakland Bay Bridge
Emeryville, CA
278

5,267

Marriott Denver South @ Park Meadows
Lone Tree, CO
279

5,123

Courtyard Charleston Historic District
Charleston, SC
176

5,083

Courtyard New York Manhattan Upper East
New York, NY
226

4,977

DoubleTree Grand Key Resort
Key West, FL
216

4,925

Courtyard Houston By The Galleria
Houston, TX
190

4,887

Marriott Denver Airport @ Gateway Park
Aurora, CO
238

4,809

Residence Inn Bethesda Downtown
Bethesda, MD
187

4,676

Hyatt House Emeryville SF Bay Area
Emeryville, CA
234

4,644

Hilton Garden Inn Los Angeles Hollywood
Los Angeles, CA
160

4,575

Hyatt House San Jose Silicon Valley
San Jose, CA
164

4,558

Hyatt House Santa Clara
Santa Clara, CA
150

4,503

Hilton Garden Inn New Orleans Conv Ctr
New Orleans, LA
286

4,499

Embassy Suites Boston Waltham
Waltham, MA
275

4,361

Homewood Suites Washington DC Downtown
Washington, DC
175

4,358

Embassy Suites Los Angeles Downey
Downey, CA
219

4,306

Renaissance Ft Lauderdale Plantation
Plantation, FL
250

4,114

Residence Inn National Harbor DC
Oxon Hill, MD
162

4,024

Courtyard Houston Dtwn Conv Ctr
Houston, TX
191

3,970

Marriott Austin South
Austin, TX
211

3,872

Residence Inn Houston Dtwn Conv Ctr
Houston, TX
171

3,437

Renaissance Boulder Flatiron Hotel
Broomfield, CO
232

3,436

Residence Inn Chicago Oak Brook
Oak Brook, IL
156

3,402

Hampton Inn Houston Near The Galleria
Houston, TX
176

3,381

Residence Inn Houston By The Galleria
Houston, TX
146

3,368

Embassy Suites Irvine Orange Cnty Arprt
Irvine, CA
293

3,307

Hyatt House Charlotte Center City
Charlotte, NC
163

3,217

Marriott Chicago Midway
Chicago, IL
200

3,185

Residence Inn Louisville Downtown
Louisville, KY
140

3,153

Hyatt House San Diego Sorrento Mesa
San Diego, CA
193

3,152

Hyatt Place Madison Downtown
Madison, WI
151

3,122

Hilton Garden Inn Bloomington
Bloomington, IN
168

2,995

Hampton Inn Garden City
Garden City, NY
143

2,808

Hilton Garden Inn Pittsburgh Univ Pl
Pittsburgh, PA
202

2,730

Residence Inn Indy Dtwn On The Canal
Indianapolis, IN
134

2,725

Hyatt House Dallas Lincoln Park
Dallas, TX
155

2,536

SpringHill Suites Portland Hillsboro
Hillsboro, OR
106

2,500

Hyatt House Houston Galleria
Houston, TX
147

2,207

Top 50 Assets
 
11,573

254,899

Other (1)
 
11,786

150,054

Total Portfolio
 
23,359

$
404,953

Note:
The information above has not been audited and is presented only for comparison purposes. Results reflect 100% of DoubleTree NYC Metropolitan financial results.
(1)
Reflects 98 hotels. Does not include two planned hotel conversions and assets sold prior to the fourth quarter of 2014.

15

RLJ Lodging Trust
Pro forma Operating Statistics
(unaudited)
 
For the quarter ended December 31, 2014
Top Markets
 
 
 
Occupancy
 
ADR
 
RevPAR
 
% of Hotel EBITDA
 
 
# of Hotels
 
2014
2013
Var
 
2014
2013
Var
 
2014
2013
Var
 
Q4
NYC
 
5
 
96.2
%
96.4
%
(0.2
)%
 
$
262.04

$
268.66

(2.5
)%
 
$
251.96

$
258.91

(2.7
)%
 
15
%
Chicago
 
21
 
66.8
%
67.5
%
(1.1
)%
 
133.18

122.28

8.9
 %
 
88.95

82.58

7.7
 %
 
9
%
Austin
 
14
 
76.9
%
76.7
%
0.2
 %
 
158.39

148.83

6.4
 %
 
121.81

114.18

6.7
 %
 
10
%
Denver
 
13
 
68.4
%
67.2
%
1.7
 %
 
124.49

123.68

0.7
 %
 
85.11

83.12

2.4
 %
 
7
%
Houston
 
9
 
74.9
%
74.0
%
1.2
 %
 
158.90

148.87

6.7
 %
 
119.08

110.21

8.1
 %
 
7
%
Washington, DC
 
7
 
70.1
%
69.2
%
1.3
 %
 
166.96

158.02

5.7
 %
 
117.01

109.36

7.0
 %
 
5
%
Other
 
75
 
73.1
%
71.5
%
2.2
 %
 
137.17

128.61

6.7
 %
 
100.21

91.90

9.0
 %
 
47
%
Total
 
144
 
73.9
%
73.0
%
1.3
 %
 
$
152.41

$
145.68

4.6
 %
 
$
112.68

$
106.30

6.0
 %
 
100
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Service Level
 
 
 
Occupancy
 
ADR
 
RevPAR
 
% of Hotel EBITDA
 
 
# of Hotels
 
2014
2013
Var
 
2014
2013
Var
 
2014
2013
Var
 
Q4
Focused-Service
 
122
 
73.4
%
72.2
%
1.7
 %
 
$
143.03

$
135.10

5.9
 %
 
$
104.93

$
97.49

7.6
 %
 
69
%
Compact Full-Service
 
21
 
77.2
%
76.9
%
0.4
 %
 
179.16

175.67

2.0
 %
 
138.25

135.03

2.4
 %
 
27
%
Full-Service
 
1
 
61.2
%
61.2
%
0.0%

 
165.76

158.99

4.3
 %
 
101.50

97.33

4.3
 %
 
4
%
Total
 
144
 
73.9
%
73.0
%
1.3
 %
 
$
152.41

$
145.68

4.6
 %
 
$
112.68

$
106.30

6.0
 %
 
100
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Chain Scale
 
 
 
Occupancy
 
ADR
 
RevPAR
 
% of Hotel EBITDA
 
 
# of Hotels
 
2014
2013
Var
 
2014
2013
Var
 
2014
2013
Var
 
Q4
Upper Upscale
 
18
 
72.1
%
71.7
%
0.5
 %
 
$
161.62

$
155.62

3.9
 %
 
$
116.51

$
111.58

4.4
 %
 
22
%
Upscale
 
104
 
75.4
%
74.4
%
1.4
 %
 
154.99

148.12

4.6
 %
 
116.91

110.18

6.1
 %
 
71
%
Upper Midscale
 
21
 
67.5
%
66.2
%
2.0
 %
 
119.75

112.49

6.5
 %
 
80.88

74.47

8.6
 %
 
7
%
Midscale
 
1
 
81.2
%
76.8
%
5.8
 %
 
77.80

61.69

26.1
 %
 
63.16

47.35

33.4
 %
 
0%

Total
 
144
 
73.9
%
73.0
%
1.3
 %
 
$
152.41

$
145.68

4.6
 %
 
$
112.68

$
106.30

6.0
 %
 
100
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Flags
 
 
 
Occupancy
 
ADR
 
RevPAR
 
% of Hotel EBITDA
 
 
# of Hotels
 
2014
2013
Var
 
2014
2013
Var
 
2014
2013
Var
 
Q4
Residence Inn
 
33
 
75.3
%
73.0
%
3.1
 %
 
$
134.96

$
128.00

5.4
 %
 
$
101.58

$
93.47

8.7
 %
 
16
%
Courtyard
 
33
 
72.3
%
70.7
%
2.3
 %
 
150.91

141.05

7.0
 %
 
109.13

99.70

9.5
 %
 
22
%
Hyatt House
 
11
 
76.0
%
80.3
%
(5.4
)%
 
151.05

136.17

10.9
 %
 
114.74

109.35

4.9
 %
 
8
%
Fairfield Inn & Suites
 
10
 
68.2
%
64.6
%
5.6
 %
 
115.33

109.34

5.5
 %
 
78.65

70.62

11.4
 %
 
3
%
SpringHill Suites
 
10
 
72.0
%
71.9
%
0.2
 %
 
111.79

108.49

3.0
 %
 
80.53

77.96

3.3
 %
 
4
%
Hilton Garden Inn
 
9
 
77.6
%
74.4
%
4.3
 %
 
175.25

173.94

0.8
 %
 
136.04

129.39

5.1
 %
 
10
%
Hampton Inn
 
8
 
69.6
%
68.9
%
1.1
 %
 
124.71

117.65

6.0
 %
 
86.83

81.02

7.2
 %
 
3
%
Embassy Suites
 
7
 
76.0
%
75.9
%
0.1
 %
 
140.74

133.19

5.7
 %
 
106.96

101.10

5.8
 %
 
6
%
Marriott
 
6
 
64.1
%
64.5
%
(0.7
)%
 
152.41

143.95

5.9
 %
 
97.68

92.91

5.1
 %
 
9
%
Renaissance
 
3
 
72.1
%
68.7
%
5.0
 %
 
157.29

154.36

1.9
 %
 
113.41

105.98

7.0
 %
 
4
%
DoubleTree
 
3
 
91.6
%
91.4
%
0.1
 %
 
238.30

242.50

(1.7
)%
 
218.19

221.74

(1.6
)%
 
8
%
Hyatt Place
 
2
 
76.3
%
78.1
%
(2.2
)%
 
144.03

127.26

13.2
 %
 
109.96

99.36

10.7
 %
 
1
%
Homewood Suites
 
2
 
69.4
%
66.1
%
5.0
 %
 
159.55

156.44

2.0
 %
 
110.65

103.34

7.1
 %
 
1
%
Hilton
 
1
 
98.5
%
99.4
%
(0.9
)%
 
279.05

289.92

(3.8
)%
 
274.81

288.17

(4.6
)%
 
3
%
Hyatt
 
1
 
80.1
%
79.5
%
0.9
 %
 
305.04

268.02

13.8
 %
 
244.46

212.96

14.8
 %
 
1
%
Other
 
5
 
65.2
%
66.1
%
(1.5
)%
 
121.72

112.72

8.0
 %
 
79.31

74.55

6.4
 %
 
1
%
Total
 
144
 
73.9
%
73.0
%
1.3
 %
 
$
152.41

$
145.68

4.6
 %
 
$
112.68

$
106.30

6.0
 %
 
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 NYC Metropolitan financial results. All results exclude two planned hotel conversions and four non-comparable hotels: Residence Inn Atlanta Midtown/Georgia Tech, Hilton Cabana Miami Beach, Hyatt Atlanta Midtown, and Fairfield Inn & Suites Key West. Does not include assets sold prior to the fourth quarter of 2014.

16

RLJ Lodging Trust
Pro forma Operating Statistics
(unaudited)
 
For the year ended December 31, 2014
Top Markets
 
 
 
Occupancy
 
ADR
 
RevPAR
 
% of Hotel EBITDA
 
 
# of Hotels
 
2014
2013
Var
 
2014
2013
Var
 
2014
2013
Var
 
FY
NYC
 
5
 
96.0
%
96.7
%
(0.7
)%
 
$
239.35

$
240.43

(0.5
)%
 
$
229.86

$
232.47

(1.1
)%
 
12
%
Chicago
 
21
 
73.5
%
72.0
%
2.0
 %
 
130.23

126.58

2.9
 %
 
95.65

91.15

4.9
 %
 
9
%
Austin
 
14
 
80.2
%
76.7
%
4.5
 %
 
151.01

144.36

4.6
 %
 
121.11

110.75

9.4
 %
 
9
%
Denver
 
13
 
76.9
%
72.6
%
5.9
 %
 
128.43

124.62

3.1
 %
 
98.82

90.52

9.2
 %
 
8
%
Houston
 
9
 
78.1
%
75.5
%
3.5
 %
 
159.56

153.06

4.2
 %
 
124.59

115.53

7.8
 %
 
7
%
Washington, DC
 
7
 
76.4
%
72.4
%
5.5
 %
 
171.01

168.43

1.5
 %
 
130.63

121.93

7.1
 %
 
6
%
Other
 
75
 
77.9
%
75.4
%
3.2
 %
 
139.41

131.23

6.2
 %
 
108.53

99.00

9.6
 %
 
49
%
Total
 
144
 
78.7
%
76.3
%
3.1
 %
 
$
150.22

$
144.57

3.9
 %
 
$
118.29

$
110.38

7.2
 %
 
100
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Service Level
 
 
 
Occupancy
 
ADR
 
RevPAR
 
% of Hotel EBITDA
 
 
# of Hotels
 
2014
2013
Var
 
2014
2013
Var
 
2014
2013
Var
 
FY
Focused-Service
 
122
 
78.3
%
75.5
%
3.7
 %
 
$
141.84

$
136.14

4.2
 %
 
$
111.12

$
102.80

8.1
 %
 
72
%
Compact Full-Service
 
21
 
81.1
%
79.9
%
1.5
 %
 
172.95

167.22

3.4
 %
 
140.29

133.69

4.9
 %
 
24
%
Full-Service
 
1
 
69.1
%
68.0
%
1.7
 %
 
178.46

169.88

5.1
 %
 
123.40

115.55

6.8
 %
 
4
%
Total
 
144
 
78.7
%
76.3
%
3.1
 %
 
$
150.22

$
144.57

3.9
 %
 
$
118.29

$
110.38

7.2
 %
 
100
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Chain Scale
 
 
 
Occupancy
 
ADR
 
RevPAR
 
% of Hotel EBITDA
 
 
# of Hotels
 
2014
2013
Var
 
2014
2013
Var
 
2014
2013
Var
 
FY
Upper Upscale
 
18
 
77.0
%
76.0
%
1.3
 %
 
$
162.30

$
154.75

4.9
 %
 
$
124.95

$
117.62

6.2
 %
 
22
%
Upscale
 
104
 
79.9
%
77.4
%
3.3
 %
 
150.92

145.52

3.7
 %
 
120.61

112.62

7.1
 %
 
69
%
Upper Midscale
 
21
 
74.4
%
70.1
%
6.1
 %
 
126.34

121.98

3.6
 %
 
94.00

85.55

9.9
 %
 
9
%
Midscale
 
1
 
85.5
%
83.3
%
2.7
 %
 
74.73

65.10

14.8
 %
 
63.93

54.24

17.8
 %
 
0%

Total
 
144
 
78.7
%
76.3
%
3.1
 %
 
$
150.22

$
144.57

3.9
 %
 
$
118.29

$
110.38

7.2
 %
 
100
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Flags
 
 
 
Occupancy
 
ADR
 
RevPAR
 
% of Hotel EBITDA
 
 
# of Hotels
 
2014
2013
Var
 
2014
2013
Var
 
2014
2013
Var
 
FY
Residence Inn
 
33
 
80.7
%
76.8
%
5.0
 %
 
$
134.72

$
130.23

3.4
 %
 
$
108.68

$
100.04

8.6
 %
 
16
%
Courtyard
 
33
 
77.1
%
74.7
%
3.2
 %
 
147.10

141.39

4.0
 %
 
113.35

105.61

7.3
 %
 
22
%
Hyatt House
 
11
 
81.3
%
82.2
%
(1.0
)%
 
148.97

135.42

10.0
 %
 
121.16

111.28

8.9
 %
 
8
%
Fairfield Inn & Suites
 
10
 
73.9
%
69.4
%
6.5
 %
 
124.48

121.44

2.5
 %
 
92.03

84.27

9.2
 %
 
4
%
SpringHill Suites
 
10
 
76.7
%
72.6
%
5.6
 %
 
112.00

110.39

1.5
 %
 
85.89

80.19

7.1
 %
 
4
%
Hilton Garden Inn
 
9
 
80.0
%
77.0
%
3.8
 %
 
170.12

166.11

2.4
 %
 
136.05

127.95

6.3
 %
 
9
%
Hampton Inn
 
8
 
76.7
%
72.5
%
5.9
 %
 
131.66

126.08

4.4
 %
 
101.01

91.36

10.6
 %
 
4
%
Embassy Suites
 
7
 
79.5
%
78.8
%
0.9
 %
 
147.62

137.95

7.0
 %
 
117.32

108.67

8.0
 %
 
6
%
Marriott
 
6
 
71.9
%
70.5
%
2.0
 %
 
154.24

146.51

5.3
 %
 
110.89

103.31

7.3
 %
 
9
%
Renaissance
 
3
 
75.3
%
74.1
%
1.5
 %
 
157.20

149.10

5.4
 %
 
118.31

110.51

7.1
 %
 
3
%
DoubleTree
 
3
 
93.0
%
91.6
%
1.6
 %
 
219.45

218.36

0.5
 %
 
204.19

200.05

2.1
 %
 
6
%
Hyatt Place
 
2
 
84.1
%
85.0
%
(1.0
)%
 
141.08

127.31

10.8
 %
 
118.62

108.16

9.7
 %
 
1
%
Homewood Suites
 
2
 
77.1
%
73.9
%
4.4
 %
 
168.77

164.10

2.8
 %
 
130.20

121.27

7.4
 %
 
2
%
Hilton
 
1
 
98.8
%
99.7
%
(0.9
)%
 
256.65

263.42

(2.6
)%
 
253.64

262.63

(3.4
)%
 
3
%
Hyatt
 
1
 
81.3
%
78.7
%
3.2
 %
 
294.21

268.26

9.7
 %
 
239.08

211.20

13.2
 %
 
1
%
Other
 
5
 
70.8
%
66.0
%
7.1
 %
 
116.72

109.76

6.3
 %
 
82.58

72.48

13.9
 %
 
2
%
Total
 
144
 
78.7
%
76.3
%
3.1
 %
 
$
150.22

$
144.57

3.9
 %
 
$
118.29

$
110.38

7.2
 %
 
100
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Note:
The information above includes results for periods prior to the Company's ownership which has not been audited and is presented only for comparison purposes. Results reflect 100% of DoubleTree NYC Metropolitan financial results. All results exclude two planned hotel conversions and four non-comparable hotels: Residence Inn Atlanta Midtown/Georgia Tech, Hilton Cabana Miami Beach, Hyatt Atlanta Midtown, and Fairfield Inn & Suites Key West (Q3 and Q4 only). Fairfield Inn & Suites Key West was closed for a comprehensive renovation during Q3 and Q4 2014 and therefore its results during the six months ended December 31, 2014 and 2013 are excluded in the table above. Does not include assets sold prior to the fourth quarter of 2014.

17
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