All amounts in this report are unaudited.
Hospitality Properties Trust
Third Quarter 2016
Supplemental Operating and Financial Data
Courtyard Camarillo, Camarillo, CA
Operator: Marriott International, Inc.
Guest Rooms: 130
EXHIBIT 99.2
Hospitality Properties Trust
Supplemental Operating and Financial Data, September 30, 2016
TABLE OF CONTENT
S
TABLE OF CONTENTS PAGE
CORPORATE INFORMATION 6
Company Profile 7,8
Investor Information 9
Research Coverage 10
FINANCIALS
Key Financial Data 12
Condensed Consolidated Balance Sheets 13
Condensed Consolidated Statements of Income 14
Notes to Condensed Consolidated Statements of Income 15
Condensed Consolidated Statements of Cash Flows 16
Debt Summary 17
Debt Maturity Schedule 18
Leverage Ratios, Coverage Ratios and Public Debt Covenants 19
FF&E Reserve Escrows 20
Property Acquisition and Disposition Information Since January 1, 2016 21
Calculation of EBITDA and Adjusted EBITDA 22
Calculation of Funds from Operations (FFO) and Normalized FFO Available for Common Shareholders 23
Non-GAAP Financial Measures Definitions 24
OPERATING AGREEMENTS AND PORTFOLIO INFORMATION
Portfolio by Operating Agreement and Manager 26
Portfolio by Brand 27
Operating Agreement Information 28-30
Operating Statistics by Hotel Operating Agreement and Manager 31
Coverage by Operating Agreement and Manager 32
2
Hospitality Properties Trust
Supplemental Operating and Financial Data, September 30, 2016
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THIS PRESENTATION OF SUPPLEMENTAL OPERATING AND FINANCIAL DATA CONTAINS STATEMENTS THAT CONSTITUTE FORWARD LOOKING STATEMENTS WITHIN THE
MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 AND OTHER SECURITIES LAWS. ALSO, WHENEVER WE USE WORDS SUCH AS “BELIEVE”, “EXPECT”,
“ANTICIPATE”, “INTEND”, “PLAN”, “ESTIMATE”, "WILL", “MAY” AND NEGATIVES OR DERIVATIVES OF THESE OR SIMILAR EXPRESSIONS, WE ARE MAKING FORWARD LOOKING
STATEMENTS. THESE FORWARD LOOKING STATEMENTS ARE BASED UPON OUR PRESENT INTENT, BELIEFS OR EXPECTATIONS, BUT FORWARD LOOKING STATEMENTS ARE NOT
GUARANTEED TO OCCUR AND MAY NOT OCCUR. FORWARD LOOKING STATEMENTS IN THIS REPORT RELATE TO VARIOUS ASPECTS OF OUR BUSINESS, INCLUDING:
• OUR HOTEL MANAGERS’ OR TENANTS’ ABILITIES TO PAY THE CONTRACTUAL AMOUNTS OF RETURNS OR RENTS DUE TO US,
• OUR ABILITY TO MAKE ACQUISITIONS OF PROPERTIES AND OTHER INVESTMENTS,
• OUR POLICIES AND PLANS REGARDING INVESTMENTS, FINANCINGS AND DISPOSITIONS,
• OUR ABILITY TO PAY DISTRIBUTIONS TO OUR SHAREHOLDERS AND THE AMOUNT OF SUCH DISTRIBUTIONS,
• OUR ABILITY TO RAISE EQUITY OR DEBT CAPITAL,
• OUR ABILITY TO APPROPRIATELY BALANCE OUR USE OF DEBT AND EQUITY CAPITAL,
• OUR INTENT TO MAKE IMPROVEMENTS TO CERTAIN OF OUR PROPERTIES AND THE SUCCESS OF OUR HOTEL RENOVATION PROGRAM,
• OUR ABILITY TO ENGAGE AND RETAIN QUALIFIED MANAGERS AND TENANTS FOR OUR HOTELS AND TRAVEL CENTERS ON SATISFACTORY TERMS,
• THE FUTURE AVAILABILITY OF BORROWINGS UNDER OUR REVOLVING CREDIT FACILITY,
• OUR ABILITY TO PAY INTEREST ON AND PRINCIPAL OF OUR DEBT,
• OUR CREDIT RATINGS,
• THE ABILITY OF TRAVELCENTERS OF AMERICA LLC, OR TA, TO PAY CURRENT AND DEFERRED RENT AMOUNTS DUE TO US,
• OUR EXPECTATION THAT WE BENEFIT FROM OUR OWNERSHIP OF THE RMR GROUP INC., OR RMR INC.,
• OUR EXPECTATION THAT WE BENEFIT FINANCIALLY BY PARTICIPATING IN AFFILIATES INSURANCE COMPANY, OR AIC, AND FROM OUR PARTICIPATION IN INSURANCE
PROGRAMS ARRANGED BY AIC,
• OUR QUALIFICATION FOR TAXATION AS A REAL ESTATE INVESTMENT TRUST, OR REIT, AND
• OTHER MATTERS.
OUR ACTUAL RESULTS MAY DIFFER MATERIALLY FROM THOSE CONTAINED IN OR IMPLIED BY OUR FORWARD LOOKING STATEMENTS AS A RESULT OF VARIOUS
FACTORS. FACTORS THAT COULD HAVE A MATERIAL ADVERSE EFFECT ON OUR FORWARD LOOKING STATEMENTS AND UPON OUR BUSINESS, RESULTS OF OPERATIONS,
FINANCIAL CONDITION, FUNDS FROM OPERATIONS, OR FFO, AVAILABLE FOR COMMON SHAREHOLDERS, NORMALIZED FUNDS FROM OPERATIONS, OR NORMALIZED FFO,
AVAILABLE FOR COMMON SHAREHOLDERS, EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION, OR EBITDA, EBITDA AS ADJUSTED, OR ADJUSTED
EBITDA, CASH FLOWS, LIQUIDITY AND PROSPECTS INCLUDE, BUT ARE NOT LIMITED TO:
• THE IMPACT OF CHANGES IN THE ECONOMY AND THE CAPITAL MARKETS ON US AND OUR MANAGERS AND TENANTS,
• COMPETITION WITHIN THE REAL ESTATE, HOTEL, TRANSPORTATION AND TRAVEL CENTER INDUSTRIES, PARTICULARLY IN THOSE MARKETS IN WHICH OUR PROPERTIES
ARE LOCATED,
• COMPLIANCE WITH, AND CHANGES TO, FEDERAL, STATE AND LOCAL LAWS AND REGULATIONS AFFECTING THE REAL ESTATE, HOTEL, TRANSPORTATION AND TRAVEL
CENTER INDUSTRIES, ACCOUNTING RULES, TAX LAWS AND SIMILAR MATTERS,
• LIMITATIONS IMPOSED ON OUR BUSINESS AND OUR ABILITY TO SATISFY COMPLEX RULES IN ORDER FOR US TO QUALIFY FOR TAXATION AS A REIT FOR U.S. FEDERAL
INCOME TAX PURPOSES,
• ACTS OF TERRORISM, OUTBREAKS OF SO CALLED PANDEMICS OR OTHER MANMADE OR NATURAL DISASTERS BEYOND OUR CONTROL, AND
• ACTUAL AND POTENTIAL CONFLICTS OF INTEREST WITH OUR RELATED PARTIES, INCLUDING OUR MANAGING TRUSTEES, TA, SONESTA INTERNATIONAL HOTELS
CORPORATION, OR SONESTA, RMR INC., THE RMR GROUP LLC, OR RMR LLC, AIC AND OTHERS AFFILIATED WITH THEM.
WARNING CONCERNING FORWARD LOOKING STATEMENTS
Hospitality Properties Trust
Supplemental Operating and Financial Data, September 30, 2016
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4
FOR EXAMPLE:
• OUR ABILITY TO MAKE FUTURE DISTRIBUTIONS TO OUR SHAREHOLDERS AND TO MAKE PAYMENTS OF PRINCIPAL AND INTEREST ON OUR INDEBTEDNESS DEPENDS UPON
A NUMBER OF FACTORS, INCLUDING OUR FUTURE EARNINGS AND THE CAPITAL COSTS WE INCUR TO MAINTAIN OUR PROPERTIES. WE MAY BE UNABLE TO PAY OUR DEBT
OBLIGATIONS OR TO MAINTAIN OUR CURRENT RATE OF DISTRIBUTIONS ON OUR COMMON AND PREFERRED SHARES AND FUTURE DISTRIBUTIONS MAY BE REDUCED OR
ELIMINATED,
• THE SECURITY DEPOSITS WHICH WE HOLD ARE NOT IN SEGREGATED CASH ACCOUNTS OR OTHERWISE SEPARATE FROM OUR OTHER ASSETS AND LIABILITIES.
ACCORDINGLY, WHEN WE RECORD INCOME BY REDUCING OUR SECURITY DEPOSIT LIABILITIES, WE DO NOT RECEIVE ANY ADDITIONAL CASH PAYMENT. BECAUSE WE DO
NOT RECEIVE ANY ADDITIONAL CASH PAYMENT AS WE APPLY SECURITY DEPOSITS TO COVER PAYMENT SHORTFALLS, THE FAILURE OF OUR MANAGERS OR TENANTS TO
PAY MINIMUM RETURNS OR RENTS DUE TO US MAY REDUCE OUR CASH FLOWS AND OUR ABILITY TO PAY DISTRIBUTIONS TO SHAREHOLDERS,
• AS OF SEPTEMBER 30, 2016, APPROXIMATELY 79% OF OUR AGGREGATE ANNUAL MINIMUM RETURNS AND RENTS WERE SECURED BY GUARANTEES OR SECURITY
DEPOSITS FROM OUR MANAGERS AND TENANTS. THIS MAY IMPLY THAT THESE MINIMUM RETURNS AND RENTS WILL BE PAID. IN FACT, CERTAIN OF THESE GUARANTEES
AND SECURITY DEPOSITS ARE LIMITED IN AMOUNT AND DURATION AND ALL THE GUARANTEES ARE SUBJECT TO THE GUARANTORS’ ABILITY AND WILLINGNESS TO PAY.
THE BALANCE OF OUR ANNUAL MINIMUM RETURNS AND RENTS AS OF SEPTEMBER 30, 2016 WAS NOT GUARANTEED NOR DO WE HOLD A SECURITY DEPOSIT WITH
RESPECT TO THOSE AMOUNTS. WE CANNOT BE SURE OF THE FUTURE FINANCIAL PERFORMANCE OF OUR PROPERTIES AND WHETHER SUCH PERFORMANCE WILL
COVER OUR MINIMUM RETURNS AND RENTS, WHETHER THE GUARANTEES OR SECURITY DEPOSITS WILL BE ADEQUATE TO COVER FUTURE SHORTFALLS IN THE MINIMUM
RETURNS OR RENTS DUE TO US, OR REGARDING OUR MANAGERS’, TENANTS’ OR GUARANTORS’ FUTURE ACTIONS IF AND WHEN THE GUARANTEES AND SECURITY
DEPOSITS EXPIRE OR ARE DEPLETED OR THEIR ABILITY OR WILLINGNESS TO PAY MINIMUM RETURNS AND RENTS OWED TO US,
• WE HAVE RECENTLY RENOVATED CERTAIN HOTELS AND ARE CURRENTLY RENOVATING ADDITIONAL HOTELS. WE EXPECT TO FUND APPROXIMATELY $53.1 MILLION FOR
RENOVATIONS AND OTHER CAPITAL IMPROVEMENT COSTS AT OUR HOTELS DURING THE 2016 FOURTH QUARTER. THE COST OF CAPITAL PROJECTS ASSOCIATED WITH
SUCH RENOVATIONS MAY BE GREATER THAN WE NOW ANTICIPATE. WHILE OUR FUNDING OF THESE CAPITAL PROJECTS WILL CAUSE OUR CONTRACTUAL MINIMUM
RETURNS TO INCREASE, THE HOTELS’ OPERATING RESULTS MAY NOT INCREASE OR MAY NOT INCREASE TO THE EXTENT THAT THE MINIMUM RETURNS INCREASE.
ACCORDINGLY, COVERAGE OF OUR MINIMUM RETURNS AT THESE HOTELS MAY REMAIN DEPRESSED FOR AN EXTENDED PERIOD,
• WE EXPECT TO PURCHASE FROM TA DURING THE 2016 FOURTH QUARTER UP TO $30.0 MILLION OF CAPITAL IMPROVEMENTS TA EXPECTS TO MAKE TO THE TRAVEL
CENTERS WE LEASE TO TA. PURSUANT TO THE TERMS OF THE APPLICABLE LEASES, THE ANNUAL RENT PAYABLE TO US BY TA WILL INCREASE AS A RESULT OF ANY SUCH
PURCHASES. WE MAY ULTIMATELY PURCHASE MORE OR LESS THAN THIS BUDGETED AMOUNT. TA MAY NOT REALIZE RESULTS FROM ANY OF THESE CAPITAL
IMPROVEMENTS WHICH EQUAL OR EXCEED THE INCREASED ANNUAL RENTS IT WILL BE OBLIGATED TO PAY TO US, WHICH COULD INCREASE THE RISK OF TA BEING
UNABLE TO PAY AMOUNTS DUE TO US,
• HOTEL ROOM DEMAND AND TRUCKING ACTIVITY ARE OFTEN REFLECTIONS OF THE GENERAL ECONOMIC ACTIVITY IN THE COUNTRY. IF ECONOMIC ACTIVITY IN THE
COUNTRY DECLINES, HOTEL ROOM DEMAND AND TRUCKING ACTIVITY MAY DECLINE AND THE OPERATING RESULTS OF OUR HOTELS AND TRAVEL CENTERS MAY DECLINE,
THE FINANCIAL RESULTS OF OUR HOTEL MANAGERS AND OUR TENANTS, INCLUDING TA, MAY SUFFER AND THESE MANAGERS AND TENANTS MAY BE UNABLE TO PAY OUR
RETURNS OR RENTS. ALSO, DEPRESSED OPERATING RESULTS FROM OUR PROPERTIES FOR EXTENDED PERIODS MAY RESULT IN THE OPERATORS OF SOME OR ALL OF
OUR HOTELS AND OUR TRAVEL CENTERS BECOMING UNABLE OR UNWILLING TO MEET THEIR OBLIGATIONS OR THEIR GUARANTEES AND SECURITY DEPOSITS WE HOLD
MAY BE EXHAUSTED,
• IF THE CURRENT LEVEL OF COMMERCIAL ACTIVITY IN THE COUNTRY DECLINES, IF THE PRICE OF DIESEL FUEL INCREASES SIGNIFICANTLY, IF FUEL CONSERVATION
MEASURES ARE INCREASED, IF FREIGHT BUSINESS IS DIRECTED AWAY FROM TRUCKING, IF TA IS UNABLE TO EFFECTIVELY COMPETE OR OPERATE ITS BUSINESS OR FOR
VARIOUS OTHER REASONS, TA MAY BECOME UNABLE TO PAY CURRENT AND DEFERRED RENTS DUE TO US,
• OUR ABILITY TO GROW OUR BUSINESS AND INCREASE OUR DISTRIBUTIONS DEPENDS IN LARGE PART UPON OUR ABILITY TO BUY PROPERTIES THAT GENERATE RETURNS
OR CAN BE LEASED FOR RENTS WHICH EXCEED OUR OPERATING AND CAPITAL COSTS. WE MAY BE UNABLE TO IDENTIFY PROPERTIES THAT WE WANT TO ACQUIRE OR TO
NEGOTIATE ACCEPTABLE PURCHASE PRICES, ACQUISITION FINANCING, MANAGEMENT CONTRACTS OR LEASE TERMS FOR NEW PROPERTIES,
• WE HAVE AGREED TO ACQUIRE FROM AND LEASE BACK TO TA A TRAVEL CENTER WHICH TA IS DEVELOPING. WE AGREED TO PURCHASE THIS PROPERTY AT TA’S COST
(INCLUDING HISTORICAL LAND COST) UP TO $29.0 MILLION IF THE DEVELOPMENT IS SUBSTANTIALLY COMPLETED PRIOR TO JUNE 30, 2017. TA HAS BEGUN
CONSTRUCTION AT THIS TRAVEL CENTER. IT IS DIFFICULT TO ESTIMATE THE COST AND TIMING TO DEVELOP A NEW TRAVEL CENTER. CONSTRUCTION OF THE NEW
TRAVEL CENTER MAY BE DELAYED FOR VARIOUS REASONS SUCH AS LABOR STRIFE, WEATHER CONDITIONS, THE UNAVAILABILITY OF CONSTRUCTION MATERIALS, ETC.
THE PURCHASE AND LEASE BACK OF THIS TRAVEL CENTER MAY NOT OCCUR, MAY BE DELAYED OR THE TERMS OF THE TRANSACTION MAY CHANGE,
• CONTINGENCIES IN OUR ACQUISITION AND SALE AGREEMENTS MAY NOT BE SATISFIED AND OUR PENDING ACQUISITIONS AND SALES AND ANY RELATED MANAGEMENT
ARRANGEMENTS WE MAY EXPECT TO ENTER INTO MAY NOT OCCUR, MAY BE DELAYED OR THE TERMS OF SUCH TRANSACTIONS OR ARRANGEMENTS MAY CHANGE,
Hospitality Properties Trust
Supplemental Operating and Financial Data, September 30, 2016
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5
• AT SEPTEMBER 30, 2016, WE HAD $9.5 MILLION OF CASH AND CASH EQUIVALENTS, $850.0 MILLION AVAILABLE UNDER OUR $1.0 BILLION REVOLVING CREDIT FACILITY
AND SECURITY DEPOSITS AND GUARANTEES COVERING SOME OF OUR MINIMUM RETURNS AND RENTS. THESE STATEMENTS MAY IMPLY THAT WE HAVE ABUNDANT
WORKING CAPITAL AND LIQUIDITY. HOWEVER, OUR MANAGERS AND TENANTS MAY NOT BE ABLE TO FUND MINIMUM RETURNS AND RENTS DUE TO US FROM
OPERATING OUR PROPERTIES OR FROM OTHER RESOURCES; IN THE PAST AND CURRENTLY, CERTAIN OF OUR TENANTS AND HOTEL MANAGERS HAVE IN FACT NOT
PAID THE MINIMUM AMOUNTS DUE TO US FROM THEIR OPERATIONS OF OUR LEASED OR MANAGED PROPERTIES. ALSO, CERTAIN OF THE SECURITY DEPOSITS AND
GUARANTEES WE HAVE TO COVER ANY SUCH SHORTFALLS ARE LIMITED IN AMOUNT AND DURATION, AND ANY SECURITY DEPOSITS WE APPLY FOR SUCH
SHORTFALLS DO NOT RESULT IN ADDITIONAL CASH FLOWS TO US. FURTHER, OUR PROPERTIES REQUIRE, AND WE HAVE AGREED TO PROVIDE, SIGNIFICANT FUNDING
FOR CAPITAL IMPROVEMENTS, RENOVATIONS AND OTHER MATTERS. ACCORDINGLY, WE MAY NOT HAVE SUFFICIENT WORKING CAPITAL OR LIQUIDITY,
• WE MAY BE UNABLE TO REPAY OUR DEBT OBLIGATIONS WHEN THEY BECOME DUE,
• CONTINUED AVAILABILITY OF BORROWINGS UNDER OUR REVOLVING CREDIT FACILITY IS SUBJECT TO OUR SATISFYING CERTAIN FINANCIAL COVENANTS AND OTHER
CUSTOMARY CREDIT FACILITY CONDITIONS THAT WE MAY BE UNABLE TO SATISFY,
• ACTUAL COSTS UNDER OUR REVOLVING CREDIT FACILITY OR OTHER FLOATING RATE CREDIT FACILITIES WILL BE HIGHER THAN LIBOR PLUS A PREMIUM BECAUSE OF
OTHER FEES AND EXPENSES ASSOCIATED WITH SUCH FACILITIES,
• THE MAXIMUM BORROWING AVAILABILITY UNDER OUR REVOLVING CREDIT FACILITY AND TERM LOAN MAY BE INCREASED TO UP TO $2.3 BILLION ON A COMBINED
BASIS IN CERTAIN CIRCUMSTANCES; HOWEVER, INCREASING THE MAXIMUM BORROWING AVAILABILITY UNDER OUR REVOLVING CREDIT FACILITY AND TERM LOAN IS
SUBJECT TO OUR OBTAINING ADDITIONAL COMMITMENTS FROM LENDERS, WHICH MAY NOT OCCUR,
• THE PREMIUMS USED TO DETERMINE THE INTEREST RATE PAYABLE ON OUR REVOLVING CREDIT FACILITY AND TERM LOAN AND THE FACILITY FEE PAYABLE ON OUR
REVOLVING CREDIT FACILITY ARE BASED ON OUR CREDIT RATINGS. FUTURE CHANGES IN OUR CREDIT RATINGS MAY CAUSE THE INTEREST AND FEES WE PAY TO
INCREASE,
• WE HAVE THE OPTION TO EXTEND THE MATURITY DATE OF OUR REVOLVING CREDIT FACILITY UPON PAYMENT OF A FEE AND MEETING OTHER CONDITIONS.
HOWEVER, THE APPLICABLE CONDITIONS MAY NOT BE MET,
• THE BUSINESS MANAGEMENT AND PROPERTY MANAGEMENT AGREEMENTS BETWEEN US AND RMR LLC HAVE CONTINUING 20 YEAR TERMS. HOWEVER, THOSE
AGREEMENTS INCLUDE TERMS WHICH PERMIT EARLY TERMINATION IN CERTAIN CIRCUMSTANCES. ACCORDINGLY, WE CANNOT BE SURE THAT THESE AGREEMENTS
WILL REMAIN IN EFFECT FOR CONTINUING 20 YEAR TERMS OR FOR SHORTER TERMS,
• WE BELIEVE THAT OUR RELATIONSHIPS WITH OUR RELATED PARTIES, INCLUDING RMR LLC, RMR INC., TA, SONESTA, AIC AND OTHERS AFFILIATED WITH THEM MAY
BENEFIT US AND PROVIDE US WITH COMPETITIVE ADVANTAGES IN OPERATING AND GROWING OUR BUSINESS. HOWEVER, THE ADVANTAGES WE BELIEVE WE MAY
REALIZE FROM THESE RELATIONSHIPS MAY NOT MATERIALIZE, AND
• MARRIOTT HAS NOTIFIED US THAT IT DOES NOT INTEND TO EXTEND ITS LEASE FOR OUR RESORT HOTEL ON KAUAI, HAWAII WHEN THAT LEASE EXPIRES ON
DECEMBER 31, 2019 AND WE INTEND TO HAVE DISCUSSIONS WITH MARRIOTT ABOUT THE FUTURE OF THIS HOTEL. THESE STATEMENTS MAY IMPLY THAT MARRIOTT
WILL NOT OPERATE THIS HOTEL IN THE FUTURE OR THAT WE MAY RECEIVE LESS CASH FLOW FROM THIS HOTEL IN THE FUTURE. OUR DISCUSSIONS WITH MARRIOTT
HAVE ONLY RECENTLY BEGUN. AT THIS TIME WE CANNOT PREDICT HOW OUR DISCUSSIONS WITH MARRIOTT WILL IMPACT THE FUTURE OF THIS HOTEL. FOR
EXAMPLE, THIS HOTEL MAY CONTINUE TO BE OPERATED BY MARRIOTT ON DIFFERENT CONTRACT TERMS THAN THE CURRENT LEASE, WE MAY IDENTIFY A DIFFERENT
OPERATOR FOR THIS HOTEL, OR THE CASH FLOW WHICH WE RECEIVE FROM OUR OWNERSHIP OF THIS HOTEL MAY BE DIFFERENT THAN THE RENT WE NOW RECEIVE.
ALSO, ALTHOUGH THE CURRENT LEASE EXPIRES ON DECEMBER 31, 2019, WE AND MARRIOTT MAY AGREE UPON A DIFFERENT TERMINATION DATE.
CURRENTLY UNEXPECTED RESULTS COULD OCCUR DUE TO MANY DIFFERENT CIRCUMSTANCES, SOME OF WHICH ARE BEYOND OUR CONTROL, SUCH AS ACTS OF
TERRORISM, NATURAL DISASTERS, CHANGES IN OUR MANAGERS’ OR TENANTS’ REVENUES OR EXPENSES, CHANGES IN OUR MANAGERS’ OR TENANTS’ FINANCIAL
CONDITIONS, THE MARKET DEMAND FOR HOTEL ROOMS OR FUEL OR CHANGES IN CAPITAL MARKETS OR THE ECONOMY GENERALLY.
THE INFORMATION CONTAINED IN OUR FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION, OR SEC, INCLUDING UNDER THE CAPTION “RISK FACTORS” IN
OUR PERIODIC REPORTS, OR INCORPORATED THEREIN, IDENTIFIES OTHER IMPORTANT FACTORS THAT COULD CAUSE DIFFERENCES FROM OUR FORWARD LOOKING
STATEMENTS. OUR FILINGS WITH THE SEC ARE AVAILABLE ON THE SEC’S WEBSITE AT WWW.SEC.GOV.
YOU SHOULD NOT PLACE UNDUE RELIANCE UPON OUR FORWARD LOOKING STATEMENTS.
EXCEPT AS REQUIRED BY LAW, WE DO NOT INTEND TO UPDATE OR CHANGE ANY FORWARD LOOKING STATEMENTS AS A RESULT OF NEW INFORMATION, FUTURE
EVENTS OR OTHERWISE.
Hospitality Properties Trust
Supplemental Operating and Financial Data, September 30, 2016
CORPORATE INFORMATION
Sonesta Philadelphia Rittenhouse Square, Philadelphia, PA
Operator: Sonesta International Hotels Corp.
Guest Rooms: 439
Hospitality Properties Trust
Supplemental Operating and Financial Data, September 30, 2016
COM
PAN
Y PROFIL
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COMPANY PROFILE
Hospitality Properties Trust, or HPT, we, our, or us, is a real estate investment trust, or REIT. As of September 30,
2016, we owned 305 hotels and 198 travel centers located in 45 states, Puerto Rico and Canada. Our properties
are operated by other companies under long term management or lease agreements. We have been investment
grade rated since 1998 and we are currently included in a number of financial indices, including the S&P MidCap
400 Index, the Russell 1000 Index, the MSCI U.S. REIT Index, the FTSE EPRA/NAREIT United States Index and
the S&P REIT Composite Index.
The Company:
Management:
HPT is managed by The RMR Group LLC, the operating subsidiary of The RMR Group Inc. (Nasdaq: RMR).
RMR is an alternative asset management company that was founded in 1986 to manage real estate companies
and related businesses. RMR primarily provides management services to four publicly owned real estate
investment trusts, or REITs, and three real estate related operating businesses. In addition to managing HPT,
RMR manages Senior Housing Properties Trust, a REIT that primarily owns healthcare, senior living and medical
office buildings, Select Income REIT, a REIT that is focused on owning and investing in net leased, single tenant
properties, and Government Properties Income Trust, a REIT that primarily owns properties leased to the U.S.
and state governments. RMR also provides management services to TravelCenters of America LLC, a publicly
traded operator of travel centers along the U.S. Interstate Highway System (including all the travel centers that
HPT owns), convenience stores and restaurants, Five Star Quality Care, Inc., a publicly traded operator of senior
living communities, and Sonesta International Hotels Corporation, a privately owned franchisor and operator of
hotels (including some of the U.S. hotels that HPT owns) and cruise ships. RMR also manages publicly traded
securities of real estate companies and private commercial real estate debt funds through wholly owned SEC
registered investment advisory subsidiaries. As of September 30, 2016, RMR had $23.8 billion of real estate
assets under management and the combined RMR managed companies had approximately $11 billion of annual
revenues, over 1,350 properties and more than 52,000 employees. We believe that being managed by RMR is a
competitive advantage for HPT because of RMR’s depth of management and experience in the real estate
industry. We also believe RMR provides management services to us at costs that are lower than we would have
to pay for similar quality services.
Corporate Headquarters:
Two Newton Place
255 Washington Street, Suite 300
Newton, MA 02458-1634
(t) (617) 964-8389
(f) (617) 969-5730
Stock Exchange Listing:
Nasdaq
Trading Symbols:
Common Shares: HPT
Preferred Shares Series D: HPTRP
Senior Unsecured Debt Ratings:
Standard & Poor's: BBB-
Moody's: Baa2
Key Data (as of September 30, 2016)
(dollars in 000s)
Total Properties 503
Hotels: 305
Travel centers: 198
Number of Rooms/Suites 46,347
Q3 2016 total revenues $ 543,516
Q3 2016 net income available for
common shareholders $ 46,646
Q3 2016 Normalized FFO (1) $ 162,135
(1) See pages 23-24 for the calculation of FFO
and Normalized FFO and a reconciliation of
these amounts from net income available for
common shareholders, determined in
accordance with U.S. generally accepted
accounting principles, or GAAP.
Hospitality Properties Trust
Supplemental Operating and Financial Data, September 30, 2016
COM
PAN
Y PROFILE (continued
)
8
COMPANY PROFILE
Operating Statistics by Operating Agreement (as of 9/30/16) (dollars in thousands):
Number Annualized Percent of Total
Number of of Rooms / Minimum Minimum Coverage (3) RevPAR Change
Operating Agreement (1) Properties Suites Return / Rent (2) Return / Rent Q3 LTM Q3 LTM
Marriott (No. 1) 53 7,610 $ 68,583 9% 1.59x 1.39x 0.3 % 3.6%
Marriott (No. 234) 68 9,120 106,243 14% 1.23x 1.13x 2.6 % 4.7%
Marriott (No. 5) 1 356 10,116 1% 0.89x 0.73x 14.4 % 9.4%
Subtotal / Average Marriott 122 17,086 184,942 24% 1.34x 1.21x 2.1 % 4.4%
InterContinental 94 14,403 160,338 21% 1.35x 1.22x 3.7 % 3.6%
Sonesta 33 6,093 85,964 11% 0.88x 0.73x 7.6 % 0.5%
Wyndham 22 3,579 28,171 4% 1.17x 0.94x 4.4 % 4.3%
Hyatt 22 2,724 22,037 3% 1.12x 1.17x 3.5 % 7.2%
Carlson 11 2,090 12,920 1% 1.72x 1.27x 7.0 % 2.0%
Morgans 1 372 7,595 1% 1.13x 1.07x (7.9%) 1.7%
Subtotal / Average Hotels 305 46,347 501,967 65% 1.25x 1.11x 3.5 % 3.7%
TA (No. 1) 40 N/A 50,885 6% 1.88x 1.68x N/A N/A
TA (No. 2) 40 N/A 51,696 7% 1.73x 1.53x N/A N/A
TA (No. 3) 39 N/A 52,262 7% 1.83x 1.58x N/A N/A
TA (No. 4) 39 N/A 49,629 6% 1.78x 1.56x N/A N/A
TA (No. 5) 40 N/A 66,685 9% 1.69x 1.59x N/A N/A
Subtotal TA 198 N/A 271,157 35% 1.78x 1.59x N/A N/A
Total / Average 503 46,347 $ 773,124 100% 1.44x 1.28x 3.5 % 3.7%
(1) See pages 28 through 30 for additional information regarding each of our operating agreements.
(2) Annualized minimum rent amounts represent cash rent amounts due to us and exclude adjustments, if any, necessary to recognize rental income on a
straight line basis in accordance with GAAP.
(3) We define coverage as combined total property level revenues minus all property level expenses and FF&E reserve escrows which are not subordinated
to minimum returns and minimum rent payments to us (which data is provided to us by our managers or tenants), divided by the minimum return or
minimum rent payments due to us. Coverage amounts for our agreement with InterContinental Hotels Group, plc, or InterContinental, and our Sonesta
and TA Nos. 1, 2, 3 and 4 agreements include data for periods prior to our ownership of certain hotels and travel centers.
(4) RevPAR is defined as hotel room revenue per day per available room. RevPAR change is the RevPAR percentage change in the period ended
September 30, 2016 over the comparable year earlier period. RevPAR amounts for our Sonesta and InterContinental agreements include data for periods
prior to our ownership of certain hotels.
Hospitality Properties Trust
Supplemental Operating and Financial Data, September 30, 2016
INVES
TOR INFORM
ATIO
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9
INVESTOR INFORMATION
Board of Trustees
Donna D. Fraiche John L. Harrington William A. Lamkin
Independent Trustee Lead Independent Trustee Independent Trustee
Adam D. Portnoy Barry M. Portnoy
Managing Trustee Managing Trustee
Senior Management
John G. Murray Mark L. Kleifges Ethan S. Bornstein
President and Chief Operating Officer Chief Financial Officer and Treasurer Senior Vice President
Contact Information
Investor Relations Inquiries
Hospitality Properties Trust Financial inquiries should be directed to Mark L. Kleifges,
Two Newton Place Chief Financial Officer and Treasurer, at (617) 964-8389
255 Washington Street, Suite 300 or mkleifges@rmrgroup.com.
Newton, MA 02458-1634
(t) (617) 964-8389 Investor and media inquiries should be directed to
(f) (617) 969-5730 Katie Strohacker, Senior Director, Investor Relations at
(email) info@hptreit.com (617) 796-8232, or kstrohacker@rmrgroup.com
(website) www.hptreit.com
Hospitality Properties Trust
Supplemental Operating and Financial Data, September 30, 2016
RESEARCH COVERAG
E
10
RESEARCH COVERAGE
Equity Research Coverage
Baird Canaccord Genuity FBR & Co.
David Loeb Ryan Meliker Bryan Maher
(414) 765-7063 (212) 389-8094 (646) 885-5423
dloeb@rwbaird.com rmeliker@canaccordgenuity.com bmaher@fbr.com
Janney Montgomery Scott JMP Securities Stifel Nicolaus
Tyler Batory Whitney Stevenson Simon Yarmak
(215) 665-4448 (415) 835-8948 (443) 224-1345
tbatory@janney.com wstevenson@jmpsecurities.com yarmaks@stifel.com
Wells Fargo Securities
Jeffrey Donnelly
(617) 603-4262
jeff.donnelly@wellsfargo.com
Debt Research Coverage
Credit Suisse Wells Fargo Securities
John Giordano Thierry Perrein
(212) 538-4935 (704) 715-8455
john.giordano@credit-suisse.com thierry.perrein@wellsfargo.com
Rating Agencies
Moody’s Investors Service Standard & Poor’s
Griselda Bisono Michael Souers
(212) 553-4985 (212) 438-2508
griselda.bisono@moodys.com michael.souers@standardandpoors.com
HPT is followed by the analysts and its publicly held debt is rated by the rating agencies listed above. Please note that any opinions, estimates or forecasts regarding HPT's
performance made by these analysts or agencies do not represent opinions, forecasts or predictions of HPT or its management. HPT does not by its reference above imply
its endorsement of or concurrence with any information, conclusions or recommendations provided by any of these analysts or agencies.
All amounts in this report are unaudited.
Hospitality Properties Trust
Third Quarter 2016
Supplemental Operating and Financial Data
Courtyard Camarillo, Camarillo, CA
Operator: Marriott International, Inc.
Guest Rooms: 130
FINANCIALS
InterContinental Yorkville, Toronto, CAN
Operator: InterContinental Hotels Group
Guest Rooms: 208
Hospitality Properties Trust
Supplemental Operating and Financial Data, September 30, 2016
KE
Y FINANCIA
L D
AT
A
12
KEY FINANCIAL DATA
(amounts in thousands, except per share data)
As of and For the Three Months Ended
9/30/2016 6/30/2016 3/31/2016 12/31/2015 9/30/2015
Selected Balance Sheet Data:
Total gross assets (1) $ 9,022,459 $ 8,970,599 $ 8,822,206 $ 8,611,932 $ 8,648,216
Total assets $ 6,586,132 $ 6,609,335 $ 6,532,140 $ 6,394,797 $ 6,481,090
Total liabilities $ 3,434,634 $ 3,814,829 $ 3,731,279 $ 3,582,715 $ 3,505,258
Total shareholders' equity $ 3,151,498 $ 2,794,506 $ 2,800,861 $ 2,812,082 $ 2,975,832
Selected Income Statement Data:
Total revenues $ 543,516 $ 550,299 $ 474,118 $ 467,440 $ 511,886
Net income (loss) available for common shareholders (2) $ 46,646 $ 50,895 $ 46,885 $ (24,660) $ 56,019
Adjusted EBITDA (3) (5) $ 210,514 $ 215,608 $ 187,703 $ 123,729 $ 192,713
Funds from operations (FFO) available for common shareholders (2) (4) $ 136,785 $ 139,677 $ 134,156 $ 61,304 $ 140,280
Normalized FFO available for common shareholders (4) (5) $ 162,135 $ 165,714 $ 140,154 $ 81,083 $ 149,692
Per Share Data:
Net income (loss) available for common shareholders (basic and diluted) (2) $ 0.30 $ 0.34 $ 0.31 $ (0.16) $ 0.37
FFO available for common shareholders (basic and diluted) (2) (4) $ 0.87 $ 0.92 $ 0.89 $ 0.40 $ 0.93
Normalized FFO available for common shareholders (basic and diluted) (4) (5) $ 1.03 $ 1.09 $ 0.93 $ 0.54 $ 0.99
Dividend Data:
Annualized dividends paid per share during the period (6) $ 2.04 $ 2.04 $ 2.00 $ 2.00 $ 2.00
Annualized dividend yield (at end of period) (6) 6.9% 7.1% 7.5% 7.6% 7.8%
Normalized FFO available for common shareholders payout ratio (4) (5) (6) 49.5% 46.6% 53.8% 93.4% 50.6%
(1) Total gross assets is total assets plus accumulated depreciation.
(2) Net income (loss) available for common shareholders and FFO for common shareholders for the three months ended September 30, 2016, June 30, 2016, March 31, 2016, December 31, 2015
and September 30, 2015 includes $25,036, or $0.16 per share, $25,920, or $0.17 per share, $5,316, or $0.04 per share, $44,880, or $0.30 per share, and $8,561, or $0.06 per share,
respectively, of incentive management fee expense. Net income (loss) available for common shareholders and FFO available for common shareholders for the three months ended December
31, 2015 includes a $36,773, or $0.24 per share, non-cash loss on the distribution of RMR common stock to our shareholders on December 14, 2015.
(3) See page 22 for the calculation of EBITDA and Adjusted EBITDA and a reconciliation of these amounts to net income (loss) determined in accordance with GAAP.
(4) See page 23 for the calculation of FFO available for common shareholders and Normalized FFO available for common shareholders and a reconciliation of net income (loss) available for
common shareholders determined in accordance with GAAP to these amounts.
(5) Adjusted EBITDA and Normalized FFO available for common shareholders for the three months ended December 31, 2015 includes $62,263, or $0.41 per share, of incentive management fee
expense.
(6) Annualized dividends paid per share for the three months ended December 31, 2015 excludes a $0.1974 per common share non-cash distribution of RMR common stock to our shareholders
on December 14, 2015.
Hospitality Properties Trust
Supplemental Operating and Financial Data, September 30, 2016
CONDENSED CONSOLID
ATED BALANCE SHEET
S
13
CONDENSED CONSOLIDATED BALANCE SHEETS
(dollar amounts in thousands, except per share data)
As of As of
September 30, December 31,
2016 2015
ASSETS
Real estate properties:
Land $ 1,550,174 $ 1,529,004
Buildings, improvements and equipment 7,047,370 6,732,768
Total real estate properties, gross 8,597,544 8,261,772
Accumulated depreciation (2,436,327) (2,217,135)
Total real estate properties, net 6,161,217 6,044,637
Cash and cash equivalents 9,534 13,682
Restricted cash (FF&E reserve escrow) 60,606 51,211
Due from related persons 62,949 50,987
Other assets, net 291,826 234,280
Total assets $ 6,586,132 $ 6,394,797
LIABILITIES AND SHAREHOLDERS' EQUITY
Unsecured revolving credit facility $ 150,000 $ 465,000
Unsecured term loan, net 398,254 397,756
Senior unsecured notes, net 2,564,476 2,403,439
Convertible senior unsecured notes 8,478 8,478
Security deposits 88,524 53,579
Accounts payable and other liabilities 155,433 179,783
Due to related persons 64,303 69,514
Dividends payable 5,166 5,166
Total liabilities 3,434,634 3,582,715
Commitments and contingencies
Shareholders' equity:
Preferred shares of beneficial interest, no par value; 100,000,000 shares authorized:
Series D preferred shares; 7 1/8% cumulative redeemable; 11,600,000 shares
issued and outstanding, aggregate liquidation preference of $290,000 280,107 280,107
Common shares of beneficial interest, $.01 par value; 200,000,000 shares
authorized; 164,269,211 and 151,547,288 shares issued and outstanding, respectively 1,643 1,515
Additional paid in capital 4,539,704 4,165,911
Cumulative net income 3,041,581 2,881,657
Cumulative other comprehensive income (loss) 35,904 (15,523)
Cumulative preferred distributions (336,811) (321,313)
Cumulative common distributions (4,410,630) (4,180,272)
Total shareholders' equity 3,151,498 2,812,082
Total liabilities and shareholders' equity $ 6,586,132 $ 6,394,797
Hospitality Properties Trust
Supplemental Operating and Financial Data, September 30, 2016
CONDENSED CONSOLID
ATED S
TA
TEMENTS OF INCOM
E
14
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(amounts in thousands, except per share data)
For the Three Months Ended September 30, For the Nine Months Ended September 30,
2016 2015 2016 2015
Revenues:
Hotel operating revenues (1) $ 464,173 $ 437,171 $ 1,332,586 $ 1,243,744
Rental income (2) 78,278 73,747 231,830 207,561
FF&E reserve income (3) 1,065 968 3,517 3,159
Total revenues 543,516 511,886 1,567,933 1,454,464
Expenses:
Hotel operating expenses (1) 322,012 308,603 923,239 870,689
Depreciation and amortization 90,139 84,261 266,192 243,812
General and administrative (4) 37,739 19,831 91,127 53,820
Acquisition related costs (5) 156 851 885 1,986
Total expenses 450,046 413,546 1,281,443 1,170,307
Operating income 93,470 98,340 286,490 284,157
Dividend income 626 — 1,375 —
Interest income 89 11 227 32
Interest expense (including amortization of debt issuance costs
and debt discounts of $2,122, $1,458, $6,114 and $4,374, respectively) (41,280) (36,628) (124,564) (107,918)
Loss on early extinguishment of debt (6) (158) — (228) —
Income before income taxes, equity in earnings (losses) of an investee and gain on sale of real estate 52,747 61,723 163,300 176,271
Income tax expense (948) (514) (3,483) (1,445)
Equity in earnings (losses) of an investee 13 (24) 107 71
Income before gain on sale of real estate 51,812 61,185 159,924 174,897
Gain on sale of real estate (7) — — — 11,015
Net income 51,812 61,185 159,924 185,912
Preferred distributions (5,166) (5,166) (15,498) (15,498)
Net income available for common shareholders $ 46,646 $ 56,019 $ 144,426 $ 170,414
Weighted average common shares outstanding (basic) $ 157,217 $ 151,359 $ 153,357 $ 150,476
Weighted average common shares outstanding (diluted) $ 157,263 $ 151,386 $ 153,390 $ 150,863
Net income available for common shareholders per common share (basic and diluted) $ 0.30 $ 0.37 $ 0.94 $ 1.13
See Notes to Condensed Consolidated Statements of Income on page 15.
Hospitality Properties Trust
Supplemental Operating and Financial Data, September 30, 2016
NOTES
TO CONDENSED CONSOLID
ATED S
TA
TEMENTS OF INCOM
E
15
NOTES TO CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(dollar amounts in thousands, except per share data)
(1) At September 30, 2016, we owned 305 hotels; 302 of these hotels are managed by hotel operating companies and three hotels are leased to hotel operating companies.
At September 30, 2016, we also owned 198 travel centers; all 198 of these travel centers are leased to a travel center operating company under five lease agreements.
Our condensed consolidated statements of income include hotel operating revenues and expenses of managed hotels and rental income from our leased hotels and
travel centers. Certain of our managed hotels had net operating results that were, in the aggregate, $2,248 and $6,560 less than the minimum returns due to us in the
three months ended September 30, 2016 and 2015, respectively, and $12,618 and $17,395 less than the minimum returns due to us in the nine months ended
September 30, 2016 and 2015, respectively. When the managers of these hotels fund the shortfalls under the terms of our operating agreements or their guarantees,
we reflect such fundings (including security deposit applications) in our condensed consolidated statements of income as a reduction of hotel operating expenses. There
was no reduction to hotel operating expenses in the three months ended September 30, 2016 or 2015 and reductions of $592 and $1,295 in the nine months ended
September 30, 2016 and 2015, respectively, as a result of such fundings. We had shortfalls at certain of our managed hotel portfolios not funded by the managers of
these hotels under the terms of our operating agreements of $2,248 and $6,560 in the three months ended September 30, 2016 and 2015, respectively, and $12,026
and $16,100 in the nine months ended September 30, 2016 and 2015, respectively, which represent the unguaranteed portions of our minimum returns from Sonesta.
Certain of our managed hotel portfolios had net operating results that were, in the aggregate, $35,123 and $28,969 more than the minimum returns due to us in the
three months ended September 30, 2016 and 2015, respectively, and $80,867 and $65,973 more than the minimum returns due to us in the nine months ended
September 30, 2016 and 2015, respectively. Certain of our guarantees and our security deposits may be replenished by a share of these excess cash flows from the
applicable hotel operations pursuant to the terms of the respective operating agreements. When our guarantees and our security deposits are replenished by cash flows
from hotel operations, we reflect such replenishments in our condensed consolidated statements of income as an increase to hotel operating expenses. Hotel operating
expenses were increased by $15,103 and $11,970 in the three months ended September 30, 2016 and 2015, respectively, and $33,897 and $27,551 in the nine months
ended September 30, 2016 and 2015, respectively, as a result of such replenishments.
(2) Rental income includes $2,932 and $3,752 in the three months ended September 30, 2016 and 2015, respectively, and $10,377 and $5,807 in the nine months ended
September 30, 2016 and 2015, respectively, of adjustments necessary to record scheduled rent increases under certain of our leases, the deferred rent obligations
under our travel center leases and the estimated future payments to us under our travel center leases for the cost of removing underground storage tanks on a straight
line basis. In calculating net income in accordance with GAAP, we generally recognize percentage rental income received for the first, second and third quarters in the
fourth quarter, which is when all contingencies have been met and the income is earned. Rental income for the nine months ended September 30, 2015 includes $2,048
of percentage rent recorded because the amount was no longer contingent as a result of our lease modifications with TA .
(3) Various percentages of total sales at certain of our hotels are escrowed as reserves for future renovations or refurbishment, or FF&E reserve escrows. We own all the
FF&E reserve escrows for our hotels. We report deposits by our tenants into the escrow accounts under our three hotel leases as FF&E reserve income. We do not
report the amounts which are escrowed as FF&E reserves for our managed hotels as FF&E reserve income.
(4) Incentive fees under our business management agreement are payable after the end of each calendar year, are calculated based on common share total return, as
defined, and are included in general and administrative expense in our condensed consolidated statements of income. In calculating net income in accordance with
GAAP, HPT recognizes estimated business management incentive fee expense, if any, each quarter. We recorded estimated business management incentive fees of
$25,036 and $8,561 during the three months ended September 30, 2016 and 2015, respectively, and $56,272 and $17,383 during the nine months ended September
30, 2016 and 2015, respectively.
(5) Represents costs associated with our acquisition activities.
(6) We recorded losses of $158 and $228 on early extinguishment of debt during the three and nine months ended September 30, 2016, respectively, in connection with the
redemptions of certain senior unsecured notes.
(7) We recorded an $11,015 gain on sale of real estate during the nine months ended September 30, 2015 in connection with the sale of five travel centers.
Hospitality Properties Trust
Supplemental Operating and Financial Data, September 30, 2016
CONDENSED CONSOLID
ATED S
TA
TEMENTS OF CASH FLOW
S
16
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
Nine Months Ended September 30,
2016 2015
Cash flows from operating activities:
Net income $ 159,924 $ 185,912
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization 266,192 243,812
Amortization of debt issuance costs and debt discounts as interest 6,114 4,374
Straight line rental income (10,377) (5,807)
Security deposits received or replenished 34,945 20,098
FF&E reserve income and deposits (57,890) (51,840)
Loss on early extinguishment of debt 228 —
Equity in earnings of an investee (107) (71)
Gain on sale of real estate — (11,015)
Other non-cash (income) expense, net (2,298) 650
Changes in assets and liabilities:
Due from related persons (1,909) (1,629)
Other assets (8,284) (7,479)
Accounts payable and other liabilities (20,823) (19,838)
Due to related persons (5,637) 17,739
Net cash provided by operating activities 360,078 374,906
Cash flows from investing activities:
Real estate acquisitions and deposits (206,745) (380,926)
Real estate improvements (122,239) (172,627)
FF&E reserve escrow fundings (2,265) (6,505)
Investment in The RMR Group Inc. — (15,196)
Net cash used in investing activities (331,249) (575,254)
Cash flows from financing activities:
Proceeds from issuance of common shares, net 371,956 —
Proceeds from issuance of senior unsecured notes, net of discounts 737,612 —
Repayment of senior unsecured notes (575,000) —
Borrowings under unsecured revolving credit facility 643,000 611,000
Repayments of unsecured revolving credit facility (958,000) (175,000)
Payment of debt issuance costs (6,106) (5)
Repurchase of common shares (583) (419)
Distributions to preferred shareholders (15,498) (15,497)
Distributions to common shareholders (230,358) (224,190)
Net cash (used in) provided by financing activities (32,977) 195,889
Decrease in cash and cash equivalents (4,148) (4,459)
Cash and cash equivalents at beginning of period 13,682 11,834
Cash and cash equivalents at end of period $ 9,534 $ 7,375
Supplemental cash flow information:
Cash paid for interest $ 137,007 $ 119,885
Cash paid for income taxes 2,464 2,289
Non-cash investing activities:
Hotel managers’ deposits in FF&E reserve $ 55,518 $ 49,774
Hotel managers’ purchases with FF&E reserve (48,388) (45,965)
Investment in The RMR Group Inc. paid in common shares — 43,285
Real estate acquisitions — (45,042)
Sales of real estate — 45,042
Hospitality Properties Trust
Supplemental Operating and Financial Data, September 30, 2016
DEBT SUMMA
RY
17
DEBT SUMMARY
As of September 30, 2016
(dollars in thousands)
Interest Principal Maturity Due at Years to
Rate Balance Date Maturity Maturity
Unsecured Floating Rate Debt:
$1,000,000 unsecured revolving credit facility (1)(2) 1.620% $ 150,000 7/15/18 $ 150,000 1.8
$400,000 unsecured term loan (2)(3) 1.720% 400,000 4/15/19 $ 400,000 2.5
Subtotal / weighted average 1.693% $ 550,000 $ 550,000 2.3
Unsecured Fixed Rate Debt:
Senior unsecured notes due 2018 6.700% 350,000 1/15/18 350,000 1.3
Senior unsecured notes due 2021 4.250% 400,000 2/15/21 400,000 4.5
Senior unsecured notes due 2022 5.000% 500,000 8/15/22 500,000 5.9
Senior unsecured notes due 2023 4.500% 300,000 6/15/23 300,000 6.7
Senior unsecured notes due 2024 4.650% 350,000 3/15/24 350,000 7.5
Senior unsecured notes due 2025 4.500% 350,000 3/15/25 350,000 8.5
Senior unsecured notes due 2026 5.250% 350,000 2/15/26 350,000 9.5
Convertible senior unsecured notes due 2027 3.800% 8,478 3/15/27 (4) 8,478 10.5
Subtotal / weighted average 4.971% $ 2,608,478 $ 2,608,478 6.2
Total / weighted average (5) 4.400% $ 3,158,478 $ 3,158,478 5.5
(1) We are required to pay interest on borrowings under our revolving credit facility at a rate of LIBOR plus a premium of 110 basis points. We also pay a
facility fee of 20 basis points per annum on the total amount of lending commitments under our revolving credit facility. Both the interest rate premium
and facility fee are subject to adjustment based upon changes to our credit ratings. The interest rate listed above is as of September 30, 2016. Subject
to meeting conditions and payment of a fee, we may extend the maturity date to July 15, 2019.
(2) The maximum borrowing availability under our revolving credit facility and term loan combined may be increased to up to $2,300,000 on certain terms
and conditions.
(3) We are required to pay interest on the amount outstanding under our term loan at a rate of LIBOR plus a premium of 120 basis points, subject to
adjustment based on changes to our credit ratings. The interest rate listed above is as of September 30, 2016. Our term loan is prepayable without
penalty at any time.
(4) Our 3.8% convertible senior unsecured notes due 2027 are convertible, if certain conditions are met (including certain changes in control). Upon
conversion, the holder of notes is entitled to receive cash in an amount equal to the principal amount of the notes and, to the extent the market price of
our common shares then exceeds the conversion price of $49.70 per share, subject to adjustment, at our option either cash or our common shares
valued based on such market price for such excess amount. Holders of our outstanding convertible senior unsecured notes may require us to
repurchase all or a portion of the notes on March 15, 2017 and March 15, 2022, or upon the occurrence of certain change in control events.
(5) Our total debt as of September 30, 2016, net of unamortized discounts and certain issuance costs totaling $37,270, was $3,121,208.
Hospitality Properties Trust
Supplemental Operating and Financial Data, September 30, 2016
DEBT M
ATURIT
Y SCHEDUL
E
18
DEBT MATURITY SCHEDULE
As of September 30, 2016
(dollars in thousands)
Unsecured Unsecured
Floating Fixed
Year Rate Debt Rate Debt Total (4)
2017 $ — $ — $ —
2018 150,000 (1) 350,000 500,000
2019 400,000 (2) — 400,000
2021 — 400,000 400,000
2022 — 500,000 500,000
2023 — 300,000 300,000
2024 — 350,000 350,000
2025 — 350,000 350,000
2026 — 350,000 350,000
2027 — 8,478 (3) 8,478
$ 550,000 $ 2,608,478 $ 3,158,478
Percent of total debt 17.4% 82.6% 100%
(1) Represents amounts outstanding under our $1,000,000 revolving credit facility at September 30, 2016. Subject to meeting conditions and
payment of a fee, we may extend the maturity date to July 15, 2019.
(2) Represents amounts outstanding on our term loan at September 30, 2016. Our term loan is prepayable without penalty at any time.
(3) Our 3.8% convertible senior unsecured notes due 2027 are convertible, if certain conditions are met (including certain changes in control). Upon
conversion, the holder of notes is entitled to receive cash in an amount equal to the principal amount of the notes and, to the extent the market
price of our common shares then exceeds the conversion price of $49.70 per share, subject to adjustment, at our option either cash or our
common shares valued based on such market price for such excess amount. Holders of our outstanding convertible senior unsecured notes
may require us to repurchase all or a portion of the notes on March 15, 2017 and March 15, 2022, or upon the occurrence of certain change in
control events.
(4) Our total debt as of September 30, 2016, net of unamortized discounts and certain issuance costs totaling $37,270, was $3,121,208.
Hospitality Properties Trust
Supplemental Operating and Financial Data, September 30, 2016
LEVERAGE R
ATIOS, COVERAGE R
ATIOS
AND PUBLIC DEBT COVENANT
S
19
LEVERAGE RATIOS, COVERAGE RATIOS AND PUBLIC DEBT COVENANTS
As of and For the Three Months Ended
9/30/2016 6/30/2016 3/31/2016 12/31/2015 9/30/2015
Leverage Ratios:
Total debt (book value) (1) / total gross assets (2) 34.6% 39.0% 39.6% 38.0% 37.7%
Total debt (book value) (1) / gross book value of real estate assets (3) 36.3% 40.8% 41.3% 39.4% 39.6%
Total debt (book value) (1) / total market capitalization (4) 37.6% 42.9% 44.7% 43.4% 43.9%
Secured debt (book value) (1) / total assets 0.0% 0.0% 0.0% 0.0% 0.0%
Variable rate debt (book value) (1) / total debt (book value) (1) 17.6% 18.0% 18.0% 26.3% 26.1%
Coverage Ratios:
Adjusted EBITDA (5) (6) / interest expense 5.1x 5.2x 4.5x 3.3x 5.3x
Adjusted EBITDA (5) (6) / interest expense and preferred distributions 4.5x 4.6x 4.0x 2.9x 4.6x
Total debt (book value) (1) / annualized Adjusted EBITDA (5) (6) 3.7x 4.1x 4.7x 6.6x 4.2x
Public Debt Covenants:
Total debt / adjusted total assets (7) - allowable maximum 60.0% 35.0% 39.4% 40.0% 37.9% 37.7%
Secured debt / adjusted total assets (7) - allowable maximum 40.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Consolidated income available for debt service (8) / debt service - required minimum 1.50x 4.19x 4.27x 4.12x 3.50x 4.68x
Total unencumbered assets (7) to unsecured debt - required minimum 150% 285.7% 253.5% 249.8% 264.1% 265.4%
(1) Debt amounts are net of unamortized discounts and certain issuance costs.
(2) Total gross assets is total assets plus accumulated depreciation.
(3) Gross book value of real estate assets is real estate properties at cost, before purchase price allocations, less impairment writedowns, if any.
(4) Total market capitalization is total debt plus the market value of our common and preferred shares at the end of each period.
(5) See page 22 for the calculation of EBITDA and Adjusted EBITDA, and a reconciliation of these amounts to net income (loss) determined in accordance with GAAP.
(6) Adjusted EBITDA for the three months ended December 31, 2015 includes $62,263 of incentive management fee expense.
(7) Adjusted total assets and total unencumbered assets include original cost of real estate assets calculated in accordance with GAAP before impairment writedowns, if any,
and exclude depreciation and amortization, accounts receivable and intangible assets. Consolidated income available for debt service is earnings from operations
excluding interest expense, depreciation and amortization, loss on asset impairment, unrealized appreciation on assets held for sale, gains and losses on early
extinguishment of debt, gains and losses on sales of property and amortization of deferred charges.
(8) Consolidated income available for debt service for the three months ended September 30, 2016, June 30, 2016, March 31, 2016, December 31, 2015 and September 30,
2015 includes $25,036, $25,920, $5,316, $44,880 and $8,561, respectively, of incentive management fee expense.
Hospitality Properties Trust
Supplemental Operating and Financial Data, September 30, 2016
FF&E RESE
RVE ESCROW
S
20
FF&E RESERVE ESCROWS (1)
(dollars in thousands)
As of and For the Three Months Ended
9/30/2016 6/30/2016 3/31/2016 12/31/2015 9/30/2015
FF&E reserves (beginning of period) $ 61,419 $ 55,891 $ 51,211 $ 44,296 $ 39,106
Manager deposits 20,050 19,603 15,542 17,607 18,683
HPT fundings (2):
Marriott No. 1 1,109 715 441 794 1,294
Marriott No. 234 — — — — 500
Hotel improvements (21,972) (14,790) (11,303) (11,486) (15,287)
FF&E reserves (end of period) $ 60,606 $ 61,419 $ 55,891 $ 51,211 $ 44,296
(1) Most of our hotel operating agreements require the deposit of a percentage of gross hotel revenues into escrows to fund FF&E
reserves. For hotels under renovation or recently renovated, this requirement may be deferred for a period. Our management
agreement with Wyndham Hotel Group, or Wyndham, requires FF&E reserve deposits subject to available cash flows, as defined in
our Wyndham agreement. Our Sonesta agreement and our lease agreement with Morgans Hotel Group, or Morgans, do not require
FF&E reserve deposits. We own all the FF&E reserve escrows for our hotels.
(2) Represents FF&E reserve deposits not funded by hotel operations, but separately funded by us. The operating agreements for our
hotels generally provide that, if necessary, we will provide FF&E funding in excess of escrowed reserves. To the extent we make such
fundings, our contractual annual minimum returns or rents generally increase by a percentage of the amounts we fund.
Hospitality Properties Trust
Supplemental Operating and Financial Data, September 30, 2016
PROPERT
Y
ACQUISITION
AND DISPOSITION INFORM
ATION SINCE JANUA
RY
1, 201
6
21
PROPERTY ACQUISITION AND DISPOSITION INFORMATION SINCE JANUARY 1, 2016
As of September 30, 2016
(dollars in thousands)
ACQUISITIONS:
Average
Number Purchase
Date of Rooms Operating Purchase Price per
Acquired Properties Brand Location / Suites Agreement Price (1) Room / Suite
2/1/2016 1 Sonesta ES Suites Cleveland, OH 158 Sonesta $ 7,200 $ 46
2/1/2016 1 Sonesta ES Suites Westlake, OH 104 Sonesta $ 4,800 $ 46
3/16/2016 1 Kimpton Hotel Monaco Portland, OR 221 InterContinental $ 114,000 $ 516
3/31/2016 1 TravelCenters of America Hillsboro, TX N/A TA No. 4 $ 19,683 N/A
6/22/2016 1 Petro Stopping Centers Brazil, IN N/A TA No. 3 $ 10,682 N/A
6/22/2016 1 Petro Stopping Centers Remington, IN N/A TA No. 1 $ 13,194 N/A
6/30/2016 1 Petro Stopping Centers Wilmington, IL N/A TA No. 2 $ 22,297 N/A
9/14/2016 — (2) TravelCenters of America Holbrook, AZ N/A TA No. 4 $ 325 N/A
9/30/2016 1 TravelCenters of America Caryville, TN N/A TA No. 2 $ 16,557 N/A
Total / Weighted Average 8 483 $ 208,738 $ 261
(1) Represents cash purchase price and excludes acquisition related costs.
(2) Represents our acquisition of a land parcel adjacent to one of our travel centers.
DISPOSITIONS:
There were no property dispositions since January 1, 2016.
Hospitality Properties Trust
Supplemental Operating and Financial Data, September 30, 2016
CALCUL
ATION OF EBITD
A
AND
ADJUSTED EBITD
A
22
CALCULATION OF EBITDA AND ADJUSTED EBITDA (1)
(in thousands)
For the Three Months Ended, For the Nine Months Ended September 30,
9/30/2016 6/30/2016 3/31/2016 12/31/2015 9/30/2015 2016 2015
Net income (loss) $ 51,812 $ 56,061 $ 52,051 $ (19,494) $ 61,185 $ 159,924 $ 185,912
Add: Interest expense 41,280 41,698 41,586 36,980 36,628 124,564 107,918
Income tax expense 948 2,160 375 121 514 3,483 1,445
Depreciation and amortization 90,139 88,782 87,271 85,964 84,261 266,192 243,812
EBITDA 184,179 188,701 181,283 103,571 182,588 554,163 539,087
Add (Less): Acquisition related costs (2) 156 117 612 389 851 885 1,986
General and administrative expense paid in
common shares (3) 985 870 422 379 713 2,277 3,726
Estimated business management incentive fee (4) 25,036 25,920 5,316 (17,383) 8,561 56,272 17,383
Loss on distribution to common shareholders of
RMR common stock (5) — — — 36,773 — — —
Loss on early extinguishment of debt (6) 158 — 70 — — 228 —
Gain on sale of real estate (7) — — — — — — (11,015)
Adjusted EBITDA $ 210,514 $ 215,608 $ 187,703 $ 123,729 $ 192,713 $ 613,825 $ 551,167
(1) Please see page 24 for definitions of EBITDA and Adjusted EBITDA and a description of why we believe the presentation of these measures provide useful information to investors.
(2) Represents costs associated with our acquisition activities.
(3) Amounts represent the portion of business management fees that were payable in our common shares as well as equity compensation awarded to our trustees, our officers and certain
employees of RMR's operating subsidiary, RMR LLC. Effective June 1, 2015, all business management fees are paid in cash.
(4) Amounts represent estimated incentive fees under our business management agreement calculated based on common share total return, as defined. In calculating net income in
accordance with GAAP, we recognize estimated business management incentive fee expense, if any, each quarter. Although we recognize this expense, if any, each quarter for purposes
of calculating net income, we do not include these amounts in the calculation of Adjusted EBITDA until the fourth quarter, which is when the actual incentive fee expense amount for the
year, if any, is determined. Incentive fees for 2015 were paid in cash in January 2016.
(5) We recorded a $36,773 non-cash loss on the distribution to common shareholders of RMR common stock to our shareholders in the three months ended December 31, 2015 as a result
of the closing price of RMR common stock being lower than our carrying amount per share on the day we distributed RMR common stock to our shareholders.
(6) We recorded losses of $158 and $70 on early extinguishment of debt during the three months ended September 30, 2016 and March 31, 2016, respectively, in connection with the
redemptions of certain senior unsecured notes.
(7) We recorded an $11,015 gain on sale of real estate during the three months ended June 30, 2015 in connection with the sale of five travel centers.
Hospitality Properties Trust
Supplemental Operating and Financial Data, September 30, 2016
CALCUL
ATION OF FUNDS FROM OPER
ATIONS (FFO)
AND NORMALIZED FF
O
AV
AILABLE FOR COMMON SHAREHOLDERS
23
CALCULATION OF FUNDS FROM OPERATIONS (FFO) AND NORMALIZED FFO AVAILABLE FOR COMMON SHAREHOLDERS (1)
(dollar amounts in thousands, except per share data)
For the Three Months Ended, For the Nine Months Ended September 30,
9/30/2016 6/30/2016 3/31/2016 12/31/2015 9/30/2015 2016 2015
Net income (loss) available for common shareholders $ 46,646 $ 50,895 $ 46,885 $ (24,660) $ 56,019 $ 144,426 $ 170,414
Add (Less): Depreciation and amortization 90,139 88,782 87,271 85,964 84,261 266,192 243,812
Gain on sale of real estate (2) — — — — — — (11,015)
FFO available for common shareholders 136,785 139,677 134,156 61,304 140,280 410,618 403,211
Add (Less): Acquisition related costs (3) 156 117 612 389 851 885 1,986
Estimated business management incentive fees (4) 25,036 25,920 5,316 (17,383) 8,561 56,272 17,383
Loss on distribution to common shareholders of
RMR common stock (5) — — — 36,773 — — —
Loss on early extinguishment of debt (6) 158 — 70 — — 228 —
Normalized FFO available for common shareholders $ 162,135 $ 165,714 $ 140,154 $ 81,083 $ 149,692 $ 468,003 $ 422,580
Weighted average shares outstanding (basic) 157,217 151,408 151,402 151,400 151,359 153,357 150,476
Weighted average shares outstanding (diluted) 157,263 151,442 151,415 151,400 151,386 153,390 150,863
Basic and diluted per share common share amounts:
Net income (loss) available for common shareholders (basic and diluted) $ 0.30 $ 0.34 $ 0.31 $ (0.16) $ 0.37 $ 0.94 $ 1.13
FFO available for common shareholders (basic) $ 0.87 $ 0.92 $ 0.89 $ 0.40 $ 0.93 $ 2.68 $ 2.68
FFO available for common shareholders (diluted) $ 0.87 $ 0.92 $ 0.89 $ 0.40 $ 0.93 $ 2.68 $ 2.67
Normalized FFO available for common shareholders (basic) $ 1.03 $ 1.09 $ 0.93 $ 0.54 $ 0.99 $ 3.05 $ 2.81
Normalized FFO available for common shareholders (diluted) $ 1.03 $ 1.09 $ 0.93 $ 0.54 $ 0.99 $ 3.05 $ 2.80
(1) Please see page 24 for definitions of FFO and Normalized FFO available for common shareholders, a description of why we believe the presentation of these measures provides useful
information to investors regarding our financial condition and results of operations and a description of how we use these measures.
(2) We recorded an $11,015 gain on sale of real estate during the three months ended June 30, 2015 in connection with the sale of five travel centers.
(3) Represents costs associated with our acquisition activities.
(4) Amounts represent estimated incentive fees under our business management agreement calculated based on common share total return, as defined. In calculating net income in accordance
with GAAP, we recognize estimated business management incentive fee expense, if any, each quarter. Although we recognize this expense, if any, each quarter for purposes of calculating net
income, we do not include these amounts in the calculation of Normalized FFO available for common shareholders until the fourth quarter, which is when the actual incentive fee expense
amount for the year, if any, is determined. Incentive fees for 2015 were paid in cash in January 2016.
(5) We recorded a $36,773 non-cash loss on the distribution of RMR common stock to our shareholders during the three months ended December 31, 2015 as a result of the closing price of RMR
common stock being lower than our carrying amount per share on the day we distributed RMR common stock to our shareholders.
(6) We recorded losses of $158 and $70 on early extinguishment of debt during the three months ended September 30, 2016 and March 31, 2016, respectively, in connection with the redemptions
of certain senior unsecured notes.
Hospitality Properties Trust
Supplemental Operating and Financial Data, September 30, 2016
NON-GAA
P FINANCIA
L MEASURES DEFINITION
S
24
Non-GAAP Financial Measures Definitions
Definition of EBITDA and Adjusted EBITDA
We calculate EBITDA and Adjusted EBITDA as shown on page 22. We consider EBITDA and Adjusted EBITDA to be appropriate supplemental measures of our
operating performance, along with net income, net income available for common shareholders and operating income. We believe that EBITDA and Adjusted EBITDA
provide useful information to investors because by excluding the effects of certain historical amounts, such as interest, depreciation and amortization expense, EBITDA
and Adjusted EBITDA may facilitate a comparison of current operating performance with our past operating performance. In calculating Adjusted EBITDA, we include
business management incentive fees only in the fourth quarter versus the quarter when they are recognized as expense in accordance with GAAP due to their quarterly
volatility not necessarily being indicative of our core operating performance and the uncertainty as to whether any such business management incentive fees will
ultimately be payable when all contingencies for determining any such fees are determined at the end of the calendar year. EBITDA and Adjusted EBITDA do not
represent cash generated by operating activities in accordance with GAAP and should not be considered an alternative to net income, net income available for common
shareholders or operating income as an indicator of operating performance or as a measure of our liquidity. These measures should be considered in conjunction with net
income, net income available for common shareholders and operating income as presented in our condensed consolidated statements of income. Other real estate
companies and REITs may calculate EBITDA and Adjusted EBITDA differently than we do.
Definition of FFO and Normalized FFO
We calculate FFO available for common shareholders and Normalized FFO available for common shareholders as shown on page 23. FFO available for common
shareholders is calculated on the basis defined by The National Association of Real Estate Investment Trusts, or NAREIT, which is net income available for common
shareholders calculated in accordance with GAAP, excluding any gain or loss on sale of properties and loss on impairment of real estate assets, plus real estate
depreciation and amortization, as well as certain other adjustments currently not applicable to us. Our calculation of Normalized FFO available for common shareholders
differs from NAREIT's definition of FFO available for common shareholders because we include business management incentive fees, if any, only in the fourth quarter
versus the quarter when they are recognized as expense in accordance with GAAP due to their quarterly volatility not necessarily being indicative of our core operating
performance and the uncertainty as to whether any such business management incentive fees will ultimately be payable when all contingencies for determining any such
fees are determined at the end of the calendar year and we exclude acquisition related costs, loss on distribution to common shareholders of RMR common stock and
loss on early extinguishment of debt. We consider FFO available for common shareholders and Normalized FFO available for common shareholders to be appropriate
supplemental measures of operating performance for a REIT, along with net income, net income available for common shareholders and operating income. We believe
that FFO available for common shareholders and Normalized FFO available for common shareholders provide useful information to investors because by excluding the
effects of certain historical amounts, such as depreciation expense, FFO available for common shareholders and Normalized FFO available for common shareholders
may facilitate a comparison of our operating performance between periods and with other REITs. FFO available for common shareholders and Normalized FFO available
for common shareholders are among the factors considered by our Board of Trustees when determining the amount of distributions to shareholders. Other factors
include, but are not limited to, requirements to maintain our qualification for taxation as a REIT, limitations in our credit agreement and public debt covenants, the
availability to us of debt and equity capital, our expectation of our future capital requirements and operating performance and our expected needs for and availability of
cash to pay our obligations. FFO available for common shareholders and Normalized FFO available for common shareholders do not represent cash generated by
operating activities in accordance with GAAP and should not be considered as alternatives to net income, net income available for common shareholders or operating
income as an indicator of our operating performance or as a measure of our liquidity. These measures should be considered in conjunction with net income, net income
available for common shareholders and operating income as presented in our condensed consolidated statements of income. Other real estate companies and REITs
may calculate FFO available for common shareholders and Normalized FFO available for common shareholders differently than we do.
Hospitality Properties Trust
Supplemental Operating and Financial Data, September 30, 2016
OPERATING AGREEMENTS AND PORTFOLIO INFORMATION
Wyndham Atlanta Galleria, Atlanta, GA
Operator: Wyndham Hotel Group
Guest Rooms: 296
Courtyard Mahwah, Mahwah, NJ
Operator: Marriott International, Inc.
Guest Rooms: 146
Hospitality Properties Trust
Supplemental Operating and Financial Data, September 30, 2016
PORTFOLIO B
Y OPER
ATING
AGREEMENT
AND MANAGER
26
PORTFOLIO BY OPERATING AGREEMENT AND MANAGER
As of September 30, 2016
(dollars in thousands)
Percent of
Percent of Percent of Total
Total Total Percent of Investment Annual Annual
Number of Number of Number of Number of Total Per Minimum Minimum
By Operating Agreement (1): Properties Properties Rooms / Suites Rooms / Suites Investment (2) Investment Room / Suite Return / Rent (3) Return / Rent
Marriott (no. 1) 53 11% 7,610 16% $ 690,765 8% $ 91 $ 68,583 9%
Marriott (no. 234) 68 14% 9,120 20% 1,000,439 11% 110 106,243 14%
Marriott (no. 5) 1 0% 356 0% 90,078 1% 253 10,116 1%
Subtotal / Average Marriott 122 25% 17,086 36% 1,781,282 20% 104 184,942 24%
InterContinental 94 19% 14,403 31% 1,677,641 19% 116 160,338 21%
Sonesta 33 6% 6,093 13% 1,140,710 13% 187 85,964 11%
Wyndham 22 4% 3,579 8% 384,354 4% 107 28,171 4%
Hyatt 22 4% 2,724 6% 301,942 3% 111 22,037 3%
Carlson 11 2% 2,090 5% 209,895 2% 100 12,920 1%
Morgans 1 0% 372 1% 120,000 1% 323 7,595 1%
Subtotal / Average Hotels 305 60% 46,347 100% 5,615,824 62% 121 501,967 65%
TA (No. 1) 40 8% N/A N/A 654,945 7% N/A 50,885 6%
TA (No. 2) 40 8% N/A N/A 657,701 7% N/A 51,696 7%
TA (No. 3) 39 8% N/A N/A 615,505 7% N/A 52,262 7%
TA (No. 4) 39 8% N/A N/A 562,563 6% N/A 49,629 6%
TA (No. 5) 40 8% N/A N/A 852,253 11% N/A 66,685 9%
Subtotal / Average TA 198 40% N/A N/A 3,342,967 38% N/A 271,157 35%
Total / Average 503 100% 46,347 100% $ 8,958,791 100% $ 121 $ 773,124 100%
(1) See pages 28 through 30 for additional information regarding each of our operating agreements.
(2) Represents historical cost of our properties plus capital improvements funded by us less impairment writedowns, if any, and excludes capital improvements made from FF&E reserves
funded from hotel operations.
(3) Each of our management agreements or leases provides for payment to us of an annual minimum return or minimum rent, respectively. Certain of these minimum payment amounts are
secured by full or limited guarantees or security deposits as more fully described on pages 28 through 30. In addition, certain of our hotel management agreements provide for payment to
us of additional amounts to the extent of available cash flows as defined in the management agreement. Payments of these additional amounts are not guaranteed or secured by deposits.
Annualized minimum rent amounts represent cash rent amounts due to us and exclude adjustments, if any, necessary to recognize rental income on a straight line basis in accordance with
GAAP.
Hospitality Properties Trust
Supplemental Operating and Financial Data, September 30, 2016
PORTFOLIO B
Y BRAN
D
27
PORTFOLIO BY BRAND
As of September 30, 2016
(dollars in thousands)
Percent of Percent of
Total Total Percent of Investment
Number of Number of Number of Number of Total Per
Brand Manager Properties Properties Rooms / Suites Rooms / Suites Investment (1) Investment Room / Suite
Courtyard by Marriott® Marriott 71 14% 10,265 22% $ 975,848 12% $ 95
Candlewood Suites® InterContinental 61 12% 7,553 16% 586,472 7% 78
Residence Inn by Marriott® Marriott 35 7% 4,488 10% 538,875 6% 120
Royal Sonesta Hotels® Sonesta 4 1% 1,571 3% 473,195 5% 301
Sonesta ES Suites® Sonesta 25 5% 3,077 7% 435,207 5% 141
Crowne Plaza® InterContinental 7 1% 2,711 6% 359,240 4% 133
Staybridge Suites® InterContinental 19 4% 2,364 5% 331,291 4% 140
Hyatt Place® Hyatt 22 4% 2,724 6% 301,942 3% 111
Wyndham Hotels and Resorts® and Wyndham Grand® Wyndham 6 1% 1,823 4% 283,027 3% 155
Sonesta Hotels & Resorts® Sonesta 4 1% 1,445 3% 232,308 3% 161
InterContinental Hotels and Resorts® InterContinental 3 1% 800 2% 217,749 2% 272
Marriott Hotels and Resorts® Marriott 2 1% 748 2% 131,127 2% 175
The Clift Hotel® Morgans 1 0% 372 1% 120,000 1% 323
Radisson® Hotels & Resorts Carlson 5 1% 1,128 2% 119,630 1% 106
Kimpton® Hotels & Restaurants InterContinental 1 0% 221 0% 114,000 1% 516
TownePlace Suites by Marriott® Marriott 12 2% 1,321 2% 110,870 1% 84
Hawthorn Suites® Wyndham 16 3% 1,756 4% 101,327 1% 58
Country Inns & Suites by Carlson® Carlson 5 1% 753 2% 78,528 1% 104
Holiday Inn® InterContinental 3 1% 754 2% 68,889 1% 91
SpringHill Suites by Marriott® Marriott 2 0% 264 1% 24,562 0% 93
Park Plaza® Hotels & Resorts Carlson 1 0% 209 0% 11,737 0% 56
TravelCenters of America® TA 149 30% 0 N/A 2,335,173 26% N/A
Petro Stopping Centers® TA 49 10% 0 N/A 1,007,794 11% N/A
Total / Average 503 100% 46,347 100% $ 8,958,791 100% $ 121
(1) Represents historical cost of properties plus capital improvements funded by us less impairment writedowns, if any, and excludes capital improvements made from FF&E
reserves funded from hotel operations.
Hospitality Properties Trust
Supplemental Operating and Financial Data, September 30, 2016
OPER
ATING
AGREEMENT INFORM
ATIO
N
28
Marriott No. 1- We lease 53 Courtyard by Marriott® branded hotels in 24 states to one of our taxable REIT subsidiaries, or TRSs. The hotels are managed by a subsidiary of Marriott
International, Inc., or Marriott, under a combination management agreement which expires in 2024; Marriott has two renewal options for 12 years each for all, but not less than all, of the
hotels.
We have no security deposit or guaranty from Marriott for these 53 hotels. Accordingly, payment by Marriott of the minimum return due to us under this management agreement is limited to
available hotel cash flows after payment of operating expenses and funding of the FF&E reserve. In addition to our minimum return, this agreement provides for payment to us of 50% of
available cash flows after payment of hotel operating expenses, funding of the required FF&E reserve, payment of our minimum return and payment of certain management fees.
Marriott No. 234- We lease 68 of our Marriott branded hotels (one full service Marriott®, 35 Residence Inn by Marriott®, 18 Courtyard by Marriott®, 12 TownePlace Suites by Marriott® and two
SpringHill Suites by Marriott® hotels) in 22 states to one of our TRSs. The hotels are managed by subsidiaries of Marriott under a combination management agreement which expires in
2025; Marriott has two renewal options for 10 years each for all, but not less than all, of the hotels.
We originally held a security deposit of $64,700 under this agreement to cover payment shortfalls of our minimum return. As of September 30, 2016, the available balance of this security
deposit was $17,449. This security deposit may be replenished from a share of future cash flows from these hotels in excess of our minimum return and certain management fees. Marriott
has also provided us with a $40,000 limited guaranty for payment shortfalls up to 90% of our minimum return after the available security deposit balance has been depleted, which expires in
2019. As of September 30, 2016, the available Marriott guaranty was $30,672.
In addition to our minimum return, this agreement provides for payment to us of 62.5% of excess cash flows after payment of hotel operating expenses, funding of the required FF&E reserve,
payment of our minimum return, payment of certain management fees and replenishment of the security deposit. This additional return amount is not guaranteed or secured by the security
deposit.
Marriott No. 5- We lease one Marriott® branded hotel in Kauai, HI to a subsidiary of Marriott under a lease that expires in 2019. On August 31, 2016, Marriott notified us that it will not
exercise its renewal option at the expiration of the current lease term ending on December 31, 2019. Marriott has four renewal options for 15 years each. This lease is guaranteed by Marriott
and provides for increases in the annual minimum rent payable to us based on changes in the consumer price index.
InterContinental- We lease 93 InterContinental branded hotels (19 Staybridge Suites®, 61 Candlewood Suites®, two InterContinental®, seven Crowne Plaza®, three Holiday Inn® and one
Kimpton® Hotels & Restaurants) in 28 states in the U.S. and Ontario, Canada to one of our TRSs. These 93 hotels are managed by subsidiaries of InterContinental under a combination
management agreement. We lease one additional InterContinental® branded hotel in Puerto Rico to a subsidiary of InterContinental. The annual minimum return amount presented in the
table on page 26 includes $7,899 of minimum rent related to the leased Puerto Rico hotel. The management agreement and the lease expire in 2036; InterContinental has two renewal
options for 15 years each for all, but not less than all, of the hotels.
As of September 30, 2016, we held a security deposit of $70,963 under this agreement to cover payment shortfalls of our minimum return. This security deposit may be replenished and
increased up to $100,000 from future cash flows from these hotels in excess of our minimum return and rent and certain management fees. Under this agreement, InterContinental is required
to maintain a minimum security deposit of $37,000.
In addition to our minimum return, this management agreement provides for an annual additional return payment to us of $12,067 to the extent of available cash flows after payment of hotel
operating expenses, funding of the required FF&E reserve, if any, payment of our minimum return, payment of certain management fees and replenishment and expansion of the security
deposit. In addition, the agreement provides for payment to us of 50% of the available cash flows after payment to us of the annual additional return amount. These additional return
amounts are not guaranteed or secured by the security deposit we hold.
OPERATING AGREEMENT INFORMATION
As of September 30, 2016
(dollars in thousands)
Hospitality Properties Trust
Supplemental Operating and Financial Data, September 30, 2016
OPER
ATING
AGREEMENT INFORM
ATIO
N
29
Sonesta- We lease our 33 Sonesta branded hotels (four Royal Sonesta Hotels®, four Sonesta Hotels & Resorts® and 25 Sonesta ES Suites® hotels) in 18 states to one of our TRSs. The
hotels are managed by Sonesta under a combination management agreement which expires in 2037; Sonesta has two renewal options for 15 years each for all, but not less than all, of the
hotels.
We have no security deposit or guaranty from Sonesta. Accordingly, payment by Sonesta of the minimum return due to us under this management agreement is limited to available hotel
cash flows after the payment of operating expenses, including certain management fees, and we are financially responsible for operating cash flows deficits, if any.
In addition to our minimum return, this management agreement provides for payment to us of 80% of available cash flows after payment of hotel operating expenses, management fees to
Sonesta, our minimum return, an imputed FF&E reserve to us and reimbursement of operating loss or working capital advances, if any.
Wyndham- We lease our 22 Wyndham branded hotels (six Wyndham Hotels and Resorts® and 16 Hawthorn Suites® hotels) in 14 states to one of our TRSs. The hotels are managed by a
subsidiary of Wyndham under a combination management agreement which expires in 2038; Wyndham has two renewal options for 15 years each for all, but not less than all, of the hotels.
We also lease 48 vacation units in one of the hotels to Wyndham Vacation Resorts, Inc., or Wyndham Vacation, under a lease that expires in 2037; Wyndham Vacation has two renewal
options for 15 years each for all, but not less than all, of the vacation units. The lease is guaranteed by Wyndham and provides for rent increases of 3% per annum. The annual minimum
return amount presented in the table on page 26 includes $1,366 of minimum rent related to the Wyndham Vacation lease.
We have a guaranty of $35,656 under this agreement to cover payment shortfalls of our minimum return, subject to an annual payment limit of $17,828. This guaranty expires in 2020. As of
September 30, 2016, the available Wyndham guaranty was $3,416.
In addition to our minimum return, this management agreement provides for payment to us of 50% of available cash flows after payment of hotel operating expenses, payment of our
minimum return, funding of the FF&E reserve, if any, payment of certain management fees and reimbursement of any Wyndham guaranty advances. This additional return amount is not
guaranteed.
Hyatt- We lease our 22 Hyatt Place® branded hotels in 14 states to one of our TRSs. The hotels are managed by a subsidiary of Hyatt Hotels Corporation, or Hyatt, under a combination
management agreement that expires in 2030; Hyatt has two renewal options for 15 years each for all, but not less than all, of the hotels.
We originally had a guaranty of $50,000 under this agreement to cover payment shortfalls of our minimum return. As of September 30, 2016, the available Hyatt guaranty was $18,654.
The guaranty is limited in amount but does not expire in time and may be replenished from a share of future cash flows from the hotels in excess of our minimum return.
In addition to our minimum return, this management agreement provides for payment to us of 50% of available cash flows after payment of operating expenses, funding the required FF&E
reserve, payment of our minimum return and reimbursement to Hyatt of working capital and guaranty advances, if any. This additional return is not guaranteed.
Carlson- We lease our 11 Carlson Hotels Worldwide, or Carlson, branded hotels (five Radisson® Hotels & Resorts, one Park Plaza® Hotels & Resorts and five Country Inns & Suites®
hotels) in seven states to one of our TRSs. The hotels are managed by a subsidiary of Carlson under a combination management agreement that expires in 2030; Carlson has two renewal
options for 15 years each for all, but not less than all, of the hotels.
We originally had a limited guaranty of $40,000 under this agreement to cover payment shortfalls of our minimum return. As of September 30, 2016, the available Carlson guaranty was
$29,047. The guaranty is limited in amount but does not expire in time and may be replenished from a share of future cash flows from the hotels in excess of our minimum return.
In addition to our minimum return, this management agreement provides for payment to us of 50% of available cash flows after payment of operating expenses, funding the required FF&E
reserve, payment of our minimum return and reimbursement to Carlson of working capital and guaranty advances, if any. This additional return is not guaranteed.
OPERATING AGREEMENT INFORMATION
As of September 30, 2016
(dollars in thousands)
Hospitality Properties Trust
Supplemental Operating and Financial Data, September 30, 2016
OPER
ATING
AGREEMENT INFORM
ATIO
N
30
Morgans- We lease the Clift Hotel, a full service hotel in San Francisco, CA, to a subsidiary of Morgans under a lease agreement that expires in 2103. The lease currently provides for annual
rent to us of $7,595. On October 14, 2019 and on each fifth anniversary thereafter during the lease term, the rent due to us will be increased based on changes in the consumer price index
with minimum increases of 10% and maximum increases of 20%. Although the contractual lease terms would qualify this lease as a direct financing lease under GAAP, we account for this
lease as an operating lease due to uncertainty regarding the collection of future rent increases and we recognize rental income from this lease on a cash basis, in accordance with GAAP.
TA No. 1- We lease 40 travel centers (36 TravelCenters of America® branded travel centers and four Petro Stopping Centers® branded travel centers) in 29 states to a subsidiary of TA under
a lease that expires in 2029; TA has two renewal options for 15 years each for all, but not less than all, of these travel centers. In addition to the payment of our minimum rent, beginning in
2016, this lease provides for payment to us of percentage rent based on increases in total non-fuel revenues over base year levels (3% of non-fuel revenues above 2015 non-fuel revenues).
TA’s previously deferred rent of $27,421 is due at the expiration of the initial term of this lease. This lease is guaranteed by TA.
TA No. 2- We lease 40 travel centers (38 TravelCenters of America® branded travel centers and two Petro Stopping Centers® branded travel centers) in 27 states to a subsidiary of TA under
a lease that expires in 2028; TA has two renewal options for 15 years each for all, but not less than all, of these travel centers. In addition to the payment of our minimum rent, beginning in
2016, this lease provides for payment to us of percentage rent based on increases in total non-fuel revenues over base year levels (3% of non-fuel revenues above 2015 non-fuel revenues).
TA’s previously deferred rent of $29,107 is due at the expiration of the initial term of this lease. This lease is guaranteed by TA.
TA No. 3- We lease 39 travel centers (38 TravelCenters of America® branded travel centers and one Petro Stopping Centers® branded travel center) in 29 states to a subsidiary of TA under a
lease that expires in 2026; TA has two renewal options for 15 years each for all, but not less than all, of these travel centers. In addition to the payment of our minimum rent, beginning in
2016, this lease provides for payment to us of percentage rent based on increases in total non-fuel revenues over base year levels (3% of non-fuel revenues above 2015 non-fuel revenues).
TA’s previously deferred rent of $29,324 is due at the expiration of the initial term of this lease. This lease is guaranteed by TA.
TA No. 4- We lease 39 travel centers (37 TravelCenters of America® branded travel centers and two Petro Stopping Centers® branded travel centers) in 28 states to a subsidiary of TA under a
lease that expires in 2030; TA has two renewal options for 15 years each for all, but not less than all, of these travel centers. In addition to the payment of our minimum rent, beginning in
2016, this lease provides for payment to us of percentage rent based on increases in total non-fuel revenues over base year levels (3% of non-fuel revenues above 2015 non-fuel revenues).
TA’s previously deferred rent of $21,233 is due at the expiration of the initial term of this lease. This lease is guaranteed by TA.
TA No. 5- We lease 40 Petro Stopping Centers® branded travel centers in 25 states to a subsidiary of TA under a lease that expires in 2032; TA has two renewal options for 15 years each for
all, but not less than all, of these travel centers. In addition to the payment of our minimum rent, this lease provides for payment to us of percentage rent based on increases in total non-fuel
revenues over base year levels (3% of non-fuel revenues above 2012 non-fuel revenues). We have waived an aggregate of $2,500 of percentage rent as of September 30, 2016, the full
amount we previously agreed to waive under the TA No. 5 lease. TA’s previously deferred rent of $42,915 is due on June 30, 2024. This lease is guaranteed by TA.
OPERATING AGREEMENT INFORMATION
As of September 30, 2016
(dollars in thousands)
Hospitality Properties Trust
Supplemental Operating and Financial Data, September 30, 2016
OPER
ATING S
TA
TISTICS B
Y HOTE
L OPER
ATING
AGREEMENT
AND MANAGE
R
31
OPERATING STATISTICS BY HOTEL OPERATING AGREEMENT AND MANAGER
No. of For the Three Months Ended For the Nine Months Ended
No. of Rooms / September 30, September 30,
Hotels Suites 2016 2015 Change 2016 2015 Change
ADR
Marriott (no. 1) 53 7,610 $ 134.12 $ 130.38 2.9% $ 133.42 $ 129.15 3.3%
Marriott (no. 234) 68 9,120 132.04 128.66 2.6% 130.64 127.52 2.4%
Marriott (no. 5) 1 356 254.86 243.56 4.6% 253.20 239.67 5.6%
Subtotal / Average Marriott 122 17,086 135.98 132.00 3.0% 134.82 130.91 3.0%
InterContinental (1) 94 14,403 116.44 112.68 3.3% 116.22 111.73 4.0%
Sonesta (1) 33 6,093 145.33 139.61 4.1% 145.18 140.87 3.1%
Wyndham 22 3,579 102.00 100.04 2.0% 99.18 97.78 1.4%
Hyatt 22 2,724 108.31 105.43 2.7% 109.73 107.31 2.3%
Carlson 11 2,090 115.19 111.22 3.6% 111.90 109.15 2.5%
Morgans 1 372 271.14 287.76 (5.8%) 269.78 271.12 (0.5%)
All Hotels Total / Average 305 46,347 $ 126.69 $ 123.05 3.0% $ 125.94 $ 122.19 3.1%
OCCUPANCY
Marriott (no. 1) 53 7,610 74.7% 76.6% (1.9) pts 72.1% 72.5% (0.4) pts
Marriott (no. 234) 68 9,120 78.8% 78.8% 0.0 pts 77.8% 76.5% 1.3 pts
Marriott (no. 5) 1 356 91.8% 84.0% 7.8 pts 88.6% 86.2% 2.4 pts
Subtotal / Average Marriott 122 17,086 77.2% 77.9% (0.7) pts 75.5% 74.9% 0.6 pts
InterContinental (1) 94 14,403 86.3% 86.0% 0.3 pts 83.2% 83.8% (0.6) pts
Sonesta (1) 33 6,093 72.7% 70.3% 2.4 pts 68.5% 69.5% (1.0) pts
Wyndham 22 3,579 77.2% 75.4% 1.8 pts 73.9% 72.1% 1.8 pts
Hyatt 22 2,724 82.7% 82.1% 0.6 pts 82.2% 80.0% 2.2 pts
Carlson 11 2,090 78.9% 76.4% 2.5 pts 73.7% 75.1% (1.4) pts
Morgans 1 372 94.3% 96.5% (2.2) pts 94.2% 92.5% 1.7 pts
All Hotels Total / Average 305 46,347 80.0% 79.6% 0.4 pts 77.3% 77.2% 0.1 pts
RevPAR
Marriott (no. 1) 53 7,610 $ 100.19 $ 99.87 0.3% $ 96.20 $ 93.63 2.7%
Marriott (no. 234) 68 9,120 104.05 101.38 2.6% 101.64 97.55 4.2%
Marriott (no. 5) 1 356 233.96 204.59 14.4% 224.34 206.60 8.6%
Subtotal / Average Marriott 122 17,086 104.98 102.83 2.1% 101.79 98.05 3.8%
InterContinental (1) 94 14,403 100.49 96.90 3.7% 96.70 93.63 3.3%
Sonesta (1) 33 6,093 105.65 98.15 7.6% 99.45 97.90 1.6%
Wyndham 22 3,579 78.74 75.43 4.4% 73.29 70.50 4.0%
Hyatt 22 2,724 89.57 86.56 3.5% 90.20 85.85 5.1%
Carlson 11 2,090 90.88 84.97 7.0% 82.47 81.97 0.6%
Morgans 1 372 255.69 277.69 (7.9%) 254.13 250.79 1.3%
All Hotels Total / Average 305 46,347 $ 101.35 $ 97.95 3.5% $ 97.35 $ 94.33 3.2%
(1) Operating data includes data for periods prior to our ownership of certain hotels.
"ADR" is average daily rate; "RevPAR" is room revenue per available room. All operating data presented are based upon the operating results
provided by our managers and tenants for the indicated periods. We have not independently verified our managers' or tenants' operating data.
Hospitality Properties Trust
Supplemental Operating and Financial Data, September 30, 2016
COVERAGE B
Y OPER
ATING
AGREEMENT
AND MANAGE
R
32
COVERAGE BY OPERATING AGREEMENT AND MANAGER (1)
Number of For the Twelve Months Ended
Operating Agreement Properties 9/30/2016 6/30/2016 3/31/2016 12/31/2015 9/30/2015
Marriott (no. 1) 53 1.39x 1.38x 1.35x 1.33x 1.29x
Marriott (no. 234) 68 1.13x 1.13x 1.11x 1.08x 1.07x
Marriott (no. 5) 1 0.73x 0.62x 0.63x 0.55x 0.51x
Subtotal Marriott 122 1.21x 1.19x 1.17x 1.14x 1.12x
InterContinental 94 1.22x 1.20x 1.19x 1.19x 1.18x
Sonesta 33 0.73x 0.68x 0.67x 0.69x 0.70x
Wyndham 22 0.94x 0.92x 0.89x 0.91x 0.87x
Hyatt 22 1.17x 1.18x 1.16x 1.12x 1.04x
Carlson 11 1.27x 1.23x 1.23x 1.32x 1.30x
Morgans 1 1.07x 1.20x 1.18x 1.18x 1.09x
Subtotal Hotels 305 1.11x 1.09x 1.08x 1.08x 1.06x
TA (No. 1) 40 1.68x 1.65x 1.65x 1.73x 1.85x
TA (No. 2) 40 1.53x 1.53x 1.56x 1.75x 1.94x
TA (No. 3) 39 1.58x 1.55x 1.59x 1.74x 1.97x
TA (No. 4) 39 1.56x 1.56x 1.60x 1.76x 1.97x
TA (No. 5) 40 1.59x 1.59x 1.59x 1.71x 1.87x
Subtotal TA 198 1.59x 1.58x 1.60x 1.74x 1.91x
Total 503 1.28x 1.26x 1.26x 1.30x 1.34x
Number of For the Three Months Ended
Operating Agreement Properties 9/30/2016 6/30/2016 3/31/2016 12/31/2015 9/30/2015
Marriott (no. 1) 53 1.59x 1.72x 1.16x 1.07x 1.56x
Marriott (no. 234) 68 1.23x 1.33x 1.04x 0.94x 1.20x
Marriott (no. 5) 1 0.89x 0.48x 0.92x 0.64x 0.45x
Subtotal Marriott 122 1.34x 1.43x 1.08x 0.97x 1.29x
InterContinental 94 1.35x 1.34x 1.12x 1.08x 1.26x
Sonesta 33 0.88x 1.09x 0.42x 0.52x 0.69x
Wyndham 22 1.17x 1.38x 0.38x 0.82x 1.09x
Hyatt 22 1.12x 1.45x 1.14x 0.97x 1.17x
Carlson 11 1.72x 1.48x 1.04x 0.83x 1.55x
Morgans 1 1.13x 1.07x 1.16x 0.94x 1.63x
Subtotal Hotels 305 1.25x 1.34x 0.95x 0.92x 1.18x
TA (No. 1) 40 1.88x 1.71x 1.42x 1.71x 1.78x
TA (No. 2) 40 1.73x 1.57x 1.27x 1.54x 1.78x
TA (No. 3) 39 1.83x 1.63x 1.34x 1.53x 1.72x
TA (No. 4) 39 1.78x 1.60x 1.36x 1.51x 1.76x
TA (No. 5) 40 1.69x 1.66x 1.43x 1.60x 1.68x
Subtotal TA 198 1.78x 1.64x 1.37x 1.58x 1.74x
Total 503 1.44x 1.44x 1.09x 1.14x 1.37x
(1) We define coverage as combined total property level revenues minus all property level expenses and FF&E reserve escrows which are not
subordinated to minimum returns and minimum rent payments due to us (which data is provided to us by our managers or tenants), divided by the
minimum return or minimum rent payments due to us. Coverage amounts for our Sonesta, InterContinental and TA Nos. 1, 2, 3 and 4 agreements
include data for periods prior to our ownership of certain properties.
All operating data presented are based upon the operating results provided by our managers and tenants for the indicated periods. We have not
independently verified our managers' or tenants’ operating data.
