All amounts in this report are unaudited.
Hospitality Properties Trust
Second Quarter 2017
Supplemental Operating and Financial Data
Sonesta Resort Hilton Head Island, Hilton Head, SC
Operator: Sonesta International Hotels Corporation
Guest Rooms: 340
Exhibit 99.2
Hospitality Properties Trust
Supplemental Operating and Financial Data, June 30, 2017
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, 2017 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, June 30, 2017
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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 COMPETE FOR ACQUISITIONS EFFECTIVELY,
• 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 DEBT OR EQUITY 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 RENOVATIONS TO IMPROVE OUR HOTELS' RATES AND OCCUPANCIES,
• 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 AND OTHER OBLIGATIONS DUE TO US,
• OUR EXPECTATION THAT WE BENEFIT FROM OUR OWNERSHIP OF THE RMR GROUP INC., OR RMR INC.,
• OUR EXPECTATION THAT WE BENEFIT FROM OUR OWNERSHIP OF 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 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 CONDITIONS AND 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, June 30, 2017
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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, THE CAPITAL COSTS WE INCUR TO MAINTAIN OUR PROPERTIES AND OUR WORKING CAPITAL REQUIREMENTS. WE MAY BE UNABLE TO PAY OUR DEBT
OBLIGATIONS OR TO MAINTAIN OUR CURRENT RATE OF DISTRIBUTIONS ON OUR COMMON 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 JUNE 30, 2017, 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’ ABILITIES AND WILLINGNESS TO PAY. FURTHER, THE GUARANTEE BY WYNDHAM HOTEL GROUP, OR WYNDHAM, OF THE MINIMUM
RETURNS DUE FROM OUR HOTELS THAT ARE MANAGED BY WYNDHAM WAS DEPLETED AS OF JUNE 30, 2017. WE DO NOT KNOW WHETHER WYNDHAM WILL CONTINUE TO PAY THE MINIMUM RETURNS
DUE TO US DESPITE THE DEPLETED GUARANTEE OR IF WYNDHAM WILL DEFAULT ON ITS PAYMENTS. THE BALANCE OF OUR ANNUAL MINIMUM RETURNS AND RENTS AS OF JUNE 30, 2017 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 ABILITIES OR WILLINGNESS TO PAY MINIMUM RETURNS AND RENTS OWED TO US,
• WE HAVE RECENTLY RENOVATED CERTAIN HOTELS AND ARE CURRENTLY RENOVATING ADDITIONAL HOTELS. WE CURRENTLY EXPECT TO FUND $39.3 MILLION DURING THE REMAINDER OF 2017 AND
$30.7 MILLION IN 2018 FOR RENOVATIONS AND OTHER CAPITAL IMPROVEMENT COSTS AT OUR HOTELS AND THESE AMOUNTS WILL INCREASE IF AND AS WE CONCLUDE OUR PENDING AND OTHER
ACQUISITIONS. THE COST OF CAPITAL PROJECTS ASSOCIATED WITH SUCH RENOVATIONS MAY BE GREATER THAN WE NOW ANTICIPATE. OPERATING RESULTS AT OUR HOTELS MAY DECLINE AS A
RESULT OF HAVING ROOMS OUT OF SERVICE OR OTHER DISRUPTIONS DURING RENOVATIONS. ALSO, 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 AND CARLSON HAVE AGREED TO PURSUE THE SALE OF CERTAIN HOTELS THAT CARLSON MANAGES. HOWEVER, WE MAY NOT SUCCEED IN SELLING THESE HOTELS AND ANY SALE WE MAY
COMPLETE MAY BE FOR A PRICE BELOW OUR CARRYING VALUE,
• WE AND CARLSON HAVE AGREED THAT THE NET PROCEEDS FROM THE SALE OF THREE HOTELS THEY HAVE AGREED TO PURSUE SELLING WILL BE USED TO FUND CERTAIN RENOVATIONS AT
CERTAIN OF THE REMAINING HOTELS CARLSON MANAGES FOR US. WE HAVE ALSO AGREED TO FUND AN ADDITIONAL $35 MILLION FOR RENOVATION COSTS FOR THOSE OTHER CARLSON MANAGED
HOTELS IN EXCESS OF THE NET SALES PROCEEDS FROM THE SALES OF THE THREE HOTELS AND AVAILABLE FF&E RESERVES. THE COMMITMENT TO FUND RENOVATIONS MAY IMPLY AN
EXPECTATION THAT THE OPERATING RESULTS OF THE APPLICABLE HOTELS WILL IMPROVE AS A RESULT OF THOSE RENOVATIONS. HOWEVER, WE CANNOT BE SURE THAT THE PERFORMANCE OF
THOSE HOTELS WOULD IMPROVE AND THEY COULD DECLINE WHILE THE RENOVATIONS ARE BEING PERFORMED AND THEREAFTER. FURTHER THE COSTS TO COMPLETE THE RENOVATIONS COULD
BE GREATER, AND THE TIME TO COMPLETE THE RENOVATIONS COULD TAKE LONGER, THAN EXPECTED. IN ADDITION, ANY IMPROVED RESULTS OF THE RENOVATED HOTELS MAY NOT OFFSET THE
RENOVATION COSTS OR OTHERWISE GENERATE THE EXPECTED RETURNS,
• WE EXPECT TO PURCHASE FROM TA DURING THE REMAINDER OF 2017 APPROXIMATELY $32.9 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 AND IN THE GEOGRAPHIC AREAS WHERE OUR PROPERTIES ARE
LOCATED. 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,
• HOTEL SUPPLY GROWTH HAS BEEN INCREASING AND MAY AFFECT OUR HOTEL OPERATORS' ABILITY TO GROW AVERAGE DAILY RATE, OR ADR, AND OCCUPANCY, AND ADR AND OCCUPANCY COULD
DECLINE DUE TO INCREASED COMPETITION WHICH MAY CAUSE OUR HOTEL OPERATORS TO BECOME UNABLE TO PAY OUR RETURNS OR RENTS,
• 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, IF FUEL EFFICIENCIES, THE USE OF ALTERNATIVE FUELS OR
TRANSPORTATION TECHNOLOGIES REDUCE THE DEMAND FOR PRODUCTS AND SERVICES TA SELLS 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,
• CONTINGENCIES IN OUR ACQUISITION AND SALE AGREEMENTS MAY NOT BE SATISFIED AND OUR PENDING ACQUISITIONS AND SALES AND ANY RELATED MANAGEMENT ARRANGEMENTS WE EXPECT
TO ENTER MAY NOT OCCUR, MAY BE DELAYED OR THE TERMS OF SUCH TRANSACTIONS OR ARRANGEMENTS MAY CHANGE,
Hospitality Properties Trust
Supplemental Operating and Financial Data, June 30, 2017
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• AT JUNE 30, 2017, WE HAD $49.7 MILLION OF CASH AND CASH EQUIVALENTS, $722.0 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. 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 CREDIT FACILITY
CONDITIONS THAT WE MAY BE UNABLE TO SATISFY,
• ACTUAL COSTS UNDER OUR REVOLVING CREDIT FACILITY OR OTHER FLOATING RATE DEBT WILL BE HIGHER THAN LIBOR PLUS A PREMIUM BECAUSE OF 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 AND PROPERTY MANAGEMENT AGREEMENTS BETWEEN US AND RMR LLC HAVE CONTINUING 20 YEAR TERMS. HOWEVER, THOSE AGREEMENTS PERMIT EARLY TERMINATION IN
CERTAIN CIRCUMSTANCES. ACCORDINGLY, WE CANNOT BE SURE THAT THESE AGREEMENTS WILL REMAIN IN EFFECT FOR CONTINUING 20 YEAR 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,
• RMR INC. MAY REDUCE THE AMOUNT OF ITS DISTRIBUTIONS TO ITS SHAREHOLDERS, INCLUDING US,
• MARRIOTT INTERNATIONAL, INC., OR 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 FLOWS 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, AND
• WE HAVE ADVISED MORGANS HOTEL GROUP, OR MORGANS, THAT THE CLOSING OF ITS MERGER WITH SBE ENTERTAINMENT GROUP, LLC, OR SBE, WAS IN VIOLATION OF OUR AGREEMENT WITH
MORGANS, WE HAVE FILED AN ACTION FOR UNLAWFUL DETAINER AGAINST MORGANS AND SBE TO COMPEL MORGANS AND SBE TO SURRENDER POSSESSION OF THE SAN FRANCISCO HOTEL
WHICH MORGANS HISTORICALLY LEASED FROM US, AND WE ARE IN DISCUSSIONS WITH MORGANS AND SBE REGARDING THIS MATTER. THE OUTCOME OF THIS PENDING LITIGATION AND OF OUR
DISCUSSIONS WITH MORGANS AND SBE IS NOT ASSURED, BUT WE BELIEVE THAT MORGANS MAY SURRENDER POSSESSION OF THIS HOTEL OR THAT THE COURT WILL DETERMINE THAT
MORGANS AND SBE HAVE BREACHED THE HISTORICAL LEASE. WE ALSO BELIEVE THAT THIS HOTEL MAY REQUIRE SUBSTANTIAL CAPITAL INVESTMENT TO REMAIN COMPETITIVE IN ITS MARKET.
THE CONTINUATION OF OUR DISPUTE WITH MORGANS AND SBE REQUIRES US TO EXPEND LEGAL FEES AND THE RESULT OF THIS DISPUTE MAY CAUSE US SOME LOSS OF RENT, AT LEAST UNTIL
THIS HOTEL MAY BE RENOVATED AND OPERATIONS IMPROVE. LITIGATION AND DISPUTES WITH TENANTS OFTEN PRODUCE UNEXPECTED RESULTS AND WE CAN PROVIDE NO ASSURANCE
REGARDING THE RESULTS OF THIS DISPUTE.
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, June 30, 2017
CORPORATE INFORMATION
Staybridge Suites Ft. Lauderdale, Ft. Lauderdale, FL
Operator: InterContinental Hotels Group
Guest Rooms: 141
Hospitality Properties Trust
Supplemental Operating and Financial Data, June 30, 2017
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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 June 30, 2017,
we owned 310 hotels and 199 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 which owns properties that are primarily leased to single tenants,
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 Senior Living 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 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 June 30, 2017, RMR had $27.9 billion of real estate assets under
management and the combined RMR managed companies had approximately $11 billion of annual revenues,
over 1,400 properties and approximately 53,000 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 Symbol:
Common Shares: HPT
Senior Unsecured Debt Ratings:
Standard & Poor's: BBB-
Moody's: Baa2
Key Data (as of June 30, 2017)
(dollars in 000s)
Total Properties: 509
Hotels 310
Travel centers 199
Number of Hotel Rooms/Suites 48,087
Q2 2017 total revenues $ 570,603
Q2 2017 net income available for
common shareholders $ 60,699
Q2 2017 Normalized FFO
available for common
shareholders(1) $ 173,604
(1) See pages 23-24 for the calculation of FFO
available for common shareholders and
Normalized FFO available for common
shareholders and a reconciliation of net income
available for common shareholders, determined
in accordance with U.S. generally accepted
accounting principles, or GAAP, to these
amounts.
Hospitality Properties Trust
Supplemental Operating and Financial Data, June 30, 2017
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COMPANY PROFILE
Operating Statistics by Operating Agreement (as of 6/30/17) (dollars in thousands):
Number Annualized Percent of Total
Number of of Rooms / Minimum Minimum Coverage (3) RevPAR Change (4)
Operating Agreement (1) Properties Suites Return / Rent (2) Return / Rent Q2 LTM Q2 LTM
Marriott (No. 1) 53 7,610 $ 68,952 8% 1.51x 1.28x (4.4%) (2.3%)
Marriott (No. 234) 68 9,120 106,360 13% 1.30x 1.12x (0.3%) 1.4%
Marriott (No. 5) 1 356 10,159 1% 0.76x 0.80x 8.8% 7.3%
Subtotal / Average Marriott 122 17,086 185,471 22% 1.35x 1.16x (1.7%) 0.2%
InterContinental 97 15,518 181,485 22% 1.30x 1.18x 0.5% 1.3%
Sonesta 35 6,718 97,134 12% 1.05x 0.72x 4.9% 5.8%
Wyndham 22 3,579 28,798 4% 1.19x 0.83x (3.9%) 0.1%
Hyatt 22 2,724 22,037 3% 1.37x 1.13x 0.6% 1.6%
Carlson 11 2,090 12,920 2% 1.53x 1.35x 2.8% 3.6%
Morgans 1 372 7,595 1% 0.47x 0.90x (15.9%) (8.3%)
Subtotal / Average Hotels 310 48,087 535,440 66% 1.26x 1.07x (0.2%) 1.2%
TA (No. 1) 40 N/A 52,305 5% 1.69x 1.60x N/A N/A
TA (No. 2) 40 N/A 53,067 7% 1.61x 1.51x N/A N/A
TA (No. 3) 39 N/A 53,472 7% 1.61x 1.52x N/A N/A
TA (No. 4) 40 N/A 53,062 7% 1.53x 1.45x N/A N/A
TA (No. 5) 40 N/A 68,841 8% 1.64x 1.54x N/A N/A
Subtotal TA 199 N/A 280,747 34% 1.62x 1.52x N/A N/A
Total / Average 509 48,087 $ 816,187 100% 1.38x 1.22x (0.2%) 1.2%
(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.
2 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 June 30,
2017 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, June 30, 2017
INVES
TOR INFORM
ATIO
N
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, June 30, 2017
RESEARCH COVERAG
E
10
RESEARCH COVERAGE
Equity Research Coverage
Baird Canaccord Genuity D.A. Davidson & Co.
Michael Bellisario Ryan Meliker James O. Lykins
(414) 298-6130 (212) 389-8094 (503) 603-3041
mbellisario@rwbaird.com rmeliker@canaccordgenuity.com jlykins@dadco.com
FBR & Co. Janney Montgomery Scott JMP Securities
Bryan Maher Tyler Batory Whitney Stevenson
(646) 885-5423 (215) 665-4448 (212) 906-3538
bmaher@fbr.com tbatory@janney.com wstevenson@jmpsecurities.com
Stifel Nicolaus Wells Fargo Securities
Simon Yarmak Jeffrey Donnelly
(443) 224-1345 (617) 603-4262
yarmaks@stifel.com 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
Second Quarter 2017
Supplemental Operating and Financial Data
Sonesta Resort Hilton Head Island, Hilton Head, SC
Operator: Sonesta International Hotels Corporation
Guest Rooms: 340
FINANCIALS
Courtyard Columbia, Columbia, MD
Operator: Marriott International, Inc.
Guest Rooms: 152
Hospitality Properties Trust
Supplemental Operating and Financial Data, June 30, 2017
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
6/30/2017 3/31/2017 12/31/2016 9/30/2016 6/30/2016
Selected Balance Sheet Data:
Total gross assets (1) $ 9,621,016 $ 9,380,278 $ 9,148,224 $ 9,022,459 $ 8,970,599
Total assets $ 6,973,448 $ 6,789,434 $ 6,634,228 $ 6,586,132 $ 6,609,335
Total liabilities $ 4,193,250 $ 3,976,348 $ 3,504,839 $ 3,434,634 $ 3,814,829
Total shareholders' equity $ 2,780,198 $ 2,813,086 $ 3,129,389 $ 3,151,498 $ 2,794,506
Selected Income Statement Data:
Total revenues $ 570,603 $ 488,602 $ 479,278 $ 543,516 $ 550,299
Net income available for common shareholders $ 60,699 $ 25,843 $ 58,020 $ 46,646 $ 50,895
Adjusted EBITDA (2) (3) $ 220,297 $ 194,576 $ 136,989 $ 210,514 $ 215,608
Funds from operations (FFO) available for common shareholders (4) $ 155,854 $ 119,294 $ 149,170 $ 136,785 $ 139,677
Normalized FFO available for common shareholders (3) (4) $ 173,604 $ 148,807 $ 93,380 $ 162,135 $ 165,714
Per Share Data (basic and diluted):
Net income available for common shareholders $ 0.37 $ 0.16 $ 0.35 $ 0.30 $ 0.34
FFO available for common shareholders (4) $ 0.95 $ 0.73 $ 0.91 $ 0.87 $ 0.92
Normalized FFO available for common shareholders (3) (4) $ 1.06 $ 0.91 $ 0.57 $ 1.03 $ 1.09
Dividend Data:
Annualized dividends paid per share during the period $ 2.08 $ 2.04 $ 2.04 $ 2.04 $ 2.04
Annualized dividend yield (at end of period) (5) 6.6% 6.5% 6.4% 6.9% 7.1%
Normalized FFO available for common shareholders payout ratio (3) (4) 49.1% 56.0% 89.5% 49.5% 46.6%
(1) Total gross assets is total assets plus accumulated depreciation.
(2) See page 22 for the calculation of EBITDA and Adjusted EBITDA and a reconciliation of net income determined in accordance with GAAP to these amounts.
(3) Adjusted EBITDA and Normalized FFO available for common shareholders for the three months ended December 31, 2016 include $52,407, or $0.34 per share, of business management
incentive fee expense.
(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 available for common
shareholders determined in accordance with GAAP to these amounts.
(5) Annualized dividend yield is the annualized dividend paid during the period divided by the closing price of our common shares at the end of the period.
Hospitality Properties Trust
Supplemental Operating and Financial Data, June 30, 2017
CONDENSED CONSOLID
ATED BALANCE SHEET
S
13
CONDENSED CONSOLIDATED BALANCE SHEETS
(dollar amounts in thousands, except share data)
As of June 30, As of December 31,
2017 2016
ASSETS
Real estate properties:
Land $ 1,627,010 $ 1,566,630
Buildings, improvements and equipment 7,487,816 7,156,759
Total real estate properties, gross 9,114,826 8,723,389
Accumulated depreciation (2,647,568) (2,513,996)
Total real estate properties, net 6,467,258 6,209,393
Cash and cash equivalents 49,670 10,896
Restricted cash (FF&E reserve escrow) 58,911 60,456
Due from related persons 71,741 65,332
Other assets, net 325,868 288,151
Total assets $ 6,973,448 $ 6,634,228
LIABILITIES AND SHAREHOLDERS' EQUITY
Unsecured revolving credit facility $ 278,000 $ 191,000
Unsecured term loan, net 398,753 398,421
Senior unsecured notes, net 3,162,275 2,565,908
Convertible senior unsecured notes — 8,478
Security deposits 120,757 89,338
Accounts payable and other liabilities 190,017 188,053
Due to related persons 43,448 58,475
Dividends payable — 5,166
Total liabilities 4,193,250 3,504,839
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; zero and 11,600,000 shares issued and
outstanding, respectively, aggregate liquidation preference of zero and $290,000, respectively — 280,107
Common shares of beneficial interest, $.01 par value; 200,000,000 shares authorized; 164,282,700
and 164,268,199 shares issued and outstanding, respectively 1,643 1,643
Additional paid in capital 4,540,414 4,539,673
Cumulative net income 3,192,744 3,104,767
Cumulative other comprehensive income 52,412 39,583
Cumulative preferred distributions (343,412) (341,977)
Cumulative common distributions (4,663,603) (4,494,407)
Total shareholders' equity 2,780,198 3,129,389
Total liabilities and shareholders' equity $ 6,973,448 $ 6,634,228
Hospitality Properties Trust
Supplemental Operating and Financial Data, June 30, 2017
CONDENSED CONSOLID
ATED S
TA
TEMENTS OF INCOM
E
14
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(amounts in thousands, except share data)
For the Three Months Ended June 30, For the Six Months Ended June 30,
2017 2016 2017 2016
Revenues:
Hotel operating revenues (1) $ 488,477 $ 471,910 $ 896,064 $ 868,413
Rental income (2) 80,971 77,293 160,759 153,552
FF&E reserve income (3) 1,155 1,096 2,382 2,452
Total revenues 570,603 550,299 1,059,205 1,024,417
Expenses:
Hotel operating expenses (1) 339,549 324,922 622,272 601,227
Depreciation and amortization 95,155 88,782 188,606 176,053
General and administrative (4) 30,347 37,365 62,693 53,388
Acquisition related costs (5) — 117 — 729
Total expenses 465,051 451,186 873,571 831,397
Operating income 105,552 99,113 185,634 193,020
Dividend income 626 749 1,252 749
Interest income 122 40 379 138
Interest expense (including amortization of debt issuance costs and
debt discounts and premiums of $2,194, $2,127, $4,346 and $3,993, respectively) (45,189) (41,698) (88,755) (83,284)
Loss on early extinguishment of debt (6) — — — (70)
Income before income taxes and equity in earnings of an investee 61,111 58,204 98,510 110,553
Income tax expense (786) (2,160) (1,142) (2,535)
Equity in earnings of an investee 374 17 502 94
Net income 60,699 56,061 97,870 108,112
Preferred distributions — (5,166) (1,435) (10,332)
Excess of liquidation preference over carrying value of preferred shares redeemed (7) — — (9,893) —
Net income available for common shareholders $ 60,699 $ 50,895 $ 86,542 $ 97,780
Weighted average common shares outstanding (basic) 164,123 151,408 $ 164,121 $ 151,405
Weighted average common shares outstanding (diluted) 164,165 151,442 $ 164,157 $ 151,428
Net income available for common shareholders per common share (basic and diluted) $ 0.37 $ 0.34 $ 0.53 $ 0.65
See Notes to Condensed Consolidated Statements of Income on page 15.
Hospitality Properties Trust
Supplemental Operating and Financial Data, June 30, 2017
NOTES
TO CONDENSED CONSOLID
ATED S
TA
TEMENTS OF INCOME
15
NOTES TO CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(dollar amounts in thousands, except share data)
(1) At June 30, 2017, we owned 310 hotels; 307 of these hotels were managed by hotel operating companies and three hotels were leased to hotel operating companies. At June 30,
2017, we also owned 199 travel centers; all 199 of these travel centers were 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. The net
operating results of our managed hotel portfolios exceeded, in the aggregate, the minimum returns due to us in both the three months ended June 30, 2017 and 2016. Certain of
our managed hotels had net operating results that were, in the aggregate, $14,299 and $11,544 less than the minimum returns due to us in the six months ended June 30, 2017
and 2016, 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 June 30, 2017 or 2016 and reductions of $3,716 and $1,766 in the six months ended June 30, 2017 and 2016, 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
$10,583 and $9,778 in the six months ended June 30, 2017 and 2016, 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, $36,559 and $43,440 more than the minimum returns due to us in the three months ended
June 30, 2017 and 2016, respectively, and $36,724 and $46,918 more than the minimum returns due to us in the six months ended June 30, 2017 and 2016, 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 or their guarantees. When these guarantees and 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 $14,682 and $20,057 in the three
months ended June 30, 2017 and 2016, respectively, and $13,240 and $19,968 in the six months ended June 30, 2017 and 2016, respectively, as a result of such replenishments.
(2) Rental income includes $3,113 and $3,693 in the three months ended June 30, 2017 and 2016, respectively, and $6,121 and $7,445 in the six months ended June 30, 2017 and
2016, 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.
(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 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, we recognize
estimated business management incentive fee expense, if any, in the first, second and third quarters. Although we recognize this expense, if any, in the first, second and third
quarters for purposes of calculating net income, we do not include these amounts in the calculation of Normalized FFO available for common shareholders or Adjusted EBITDA
until the fourth quarter, which is when the business management incentive fee expense amount for the year, if any, is determined. Net income includes $17,750 and $25,920 of
estimated business management incentive fee expense in the three months ended June 30, 2017 and 2016, respectively, and $37,370 and $31,236 of estimated business
management incentive fee expense in the six months ended June 30, 2017 and 2016, respectively.
(5) Represents costs associated with our acquisition activities. Acquisition costs incurred during the 2017 periods have been capitalized in purchase accounting pursuant to a change
in GAAP.
(6) We recorded a loss on early extinguishment of debt of $70 in the six months ended June 30, 2016 in connection with the redemption of certain senior unsecured notes.
(7) On February 10, 2017, we redeemed all 11,600,000 of our outstanding 7.125% Series D cumulative redeemable preferred shares at the stated liquidation preference of $25.00 per
share plus accrued and unpaid distributions to the date of redemption (an aggregate of $291,435). The liquidation preference of the redeemed shares exceeded the carrying
amount for the redeemed shares as of the date of redemption by $9,893, or $0.06 per share, and we reduced net income available to common shareholders in the six months
ended June 30, 2017 by that excess amount.
Hospitality Properties Trust
Supplemental Operating and Financial Data, June 30, 2017
CONDENSED CONSOLID
ATED S
TA
TEMENTS OF CASH FLOW
S
16
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
For the Six Months Ended June 30,
2017 2016
Cash flows from operating activities:
Net income $ 97,870 $ 108,112
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization 188,606 176,053
Amortization of debt issuance costs and debt discounts and premiums as interest 4,346 3,993
Straight line rental income (6,121) (7,445)
Security deposits received or replenished 31,422 23,690
FF&E reserve income and deposits (37,134) (37,491)
Loss on early extinguishment of debt — 70
Equity in earnings of an investee (502) (94)
Other non-cash (income) expense, net (1,810) (1,793)
Changes in assets and liabilities:
Due from related persons (490) (775)
Other assets (11,702) (11,792)
Accounts payable and other liabilities 6,565 9,923
Due to related persons (15,175) (30,956)
Net cash provided by operating activities 255,875 231,495
Cash flows from investing activities:
Real estate acquisitions and deposits (357,679) (196,856)
Real estate improvements (62,204) (86,929)
FF&E reserve escrow fundings (3,157) (1,156)
Net cash used in investing activities (423,040) (284,941)
Cash flows from financing activities:
Proceeds from issuance of senior unsecured notes, after discounts and premiums 598,246 737,612
Repayment of senior unsecured notes — (275,000)
Redemption of preferred shares (290,000) —
Repurchase of convertible senior notes (8,478) —
Borrowings under unsecured revolving credit facility 359,000 410,000
Repayments of unsecured revolving credit facility (272,000) (643,000)
Payment of debt issuance costs (5,018) (6,106)
Repurchase of common shares (14) —
Distributions to preferred shareholders (6,601) (10,332)
Distributions to common shareholders (169,196) (153,063)
Net cash provided by financing activities 205,939 60,111
Increase in cash and cash equivalents 38,774 6,665
Cash and cash equivalents at beginning of period 10,896 13,682
Cash and cash equivalents at end of period $ 49,670 $ 20,347
Supplemental cash flow information:
Cash paid for interest $ 75,266 $ 65,889
Cash paid for income taxes 2,226 1,988
Non-cash investing activities:
Hotel managers’ deposits in FF&E reserve $ 35,175 $ 35,145
Hotel managers’ purchases with FF&E reserve (39,877) (26,093)
Hospitality Properties Trust
Supplemental Operating and Financial Data, June 30, 2017
DEBT SUMMA
RY
17
DEBT SUMMARY
As of June 30, 2017
(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) 2.326% $ 278,000 7/15/18 $ 278,000 1.0
$400,000 unsecured term loan (2) (3) 2.251% 400,000 4/15/19 400,000 1.8
Subtotal / weighted average 2.269% $ 678,000 $ 678,000 1.5
Unsecured Fixed Rate Debt:
Senior unsecured notes due 2018 6.700% $ 350,000 1/15/18 (4) $ 350,000 0.5
Senior unsecured notes due 2021 4.250% 400,000 2/15/21 400,000 3.7
Senior unsecured notes due 2022 5.000% 500,000 8/15/22 500,000 5.1
Senior unsecured notes due 2023 4.500% 500,000 6/15/23 500,000 6.0
Senior unsecured notes due 2024 4.650% 350,000 3/15/24 350,000 6.7
Senior unsecured notes due 2025 4.500% 350,000 3/15/25 350,000 7.7
Senior unsecured notes due 2026 5.250% 350,000 2/15/26 350,000 8.6
Senior unsecured notes due 2027 4.950% 400,000 2/15/27 400,000 9.6
Subtotal / weighted average 4.942% $ 3,200,000 $ 3,200,000 6.0
Total / weighted average (5) 4.562% $ 3,878,000 $ 3,878,000 5.2
(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 June 30, 2017. 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 June 30, 2017. Our term loan is prepayable without
penalty at any time.
(4) Notes can be redeemed on or after July 15, 2017 without penalty.
(5) Our total debt as of June 30, 2017, net of unamortized discounts and premiums and certain issuance costs totaling $38,972, was $3,839,028.
Hospitality Properties Trust
Supplemental Operating and Financial Data, June 30, 2017
DEBT M
ATURIT
Y SCHEDUL
E
18
DEBT MATURITY SCHEDULE
As of June 30, 2017
(dollars in thousands)
Unsecured Unsecured
Floating Fixed
Year Rate Debt Rate Debt Total (4)
2017 $ — $ — $ —
2018 278,000 (1) 350,000 (2) 628,000
2019 400,000 (3) — 400,000
2021 — 400,000 400,000
2022 — 500,000 500,000
2023 — 500,000 500,000
2024 — 350,000 350,000
2025 — 350,000 350,000
2026 — 350,000 350,000
2027 — 400,000 400,000
$ 678,000 $ 3,200,000 $ 3,878,000
Percent of total debt 17.5% 82.5% 100%
(1) Represents amounts outstanding under our $1,000,000 revolving credit facility at June 30, 2017. Subject to meeting conditions and payment of
a fee, we may extend the maturity date to July 15, 2019.
(2) Notes can be redeemed on or after July 15, 2017 without penalty.
(3) Represents amounts outstanding on our term loan at June 30, 2017. Our term loan is prepayable without penalty at any time.
(4) Our total debt as of June 30, 2017, net of unamortized discounts and premiums and certain issuance costs totaling $38,972, was $3,839,028.
Hospitality Properties Trust
Supplemental Operating and Financial Data, June 30, 2017
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
6/30/2017 3/31/2017 12/31/2016 9/30/2016 6/30/2016
Leverage Ratios:
Total debt (book value) (1) / total gross assets (2) 39.9% 39.3% 34.6% 34.6% 39.0%
Total debt (book value) (1) / gross book value of real estate assets (3) 42.0% 41.4% 36.3% 36.3% 40.8%
Total debt (book value) (1) / total market capitalization (4) 44.5% 41.6% 36.5% 37.6% 42.9%
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% 14.3% 18.6% 17.6% 18.0%
Coverage Ratios:
Adjusted EBITDA (5) (6) / interest expense 4.9x 4.5x 3.7x 5.1x 5.2x
Adjusted EBITDA (5) (6) / interest expense and preferred distributions 4.9x 4.3x 3.2x 4.5x 4.6x
Total debt (book value) (1) / annualized Adjusted EBITDA (5) (6) 4.4x 4.7x 5.8x 3.7x 4.1x
Public Debt Covenants:
Total debt / adjusted total assets (7) - allowable maximum 60.0% 40.3% 39.8% 34.9% 35.0% 39.4%
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 4.24x 3.79x 4.99x 4.19x 4.27x
Total unencumbered assets (7) to unsecured debt - required minimum 150% 248.3% 251.1% 286.1% 285.7% 253.5%
(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 net income determined in accordance with GAAP to these amounts.
(6) Adjusted EBITDA for the three months ended December 31, 2016 includes $52,407 of business management incentive 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 December 31, 2016 includes the reversal of $3,865 of previously accrued business
management incentive fee expense. Consolidated income available for debt service for the three months ended June 30, 2017, March 31, 2017, September 30, 2016 and
June 30, 2016 includes $17,750, $19,620, $25,036 and $25,920, respectively, of estimated business management incentive fee expense.
Hospitality Properties Trust
Supplemental Operating and Financial Data, June 30, 2017
FF&E RESE
RVE ESCROW
S
20
FF&E RESERVE ESCROWS (1)
(dollars in thousands)
As of and For the Three Months Ended
6/30/2017 3/31/2017 12/31/2016 9/30/2016 6/30/2016
FF&E reserves (beginning of period) $ 56,713 $ 60,456 $ 60,606 $ 61,419 $ 55,891
Manager deposits 19,573 15,602 19,681 20,050 19,603
HPT fundings (2):
Marriott No. 1 1,167 1,990 534 1,109 715
Marriott No. 234 — — 950 — —
Hotel improvements (18,542) (21,335) (21,315) (21,972) (14,790)
FF&E reserves (end of period) $ 58,911 $ 56,713 $ 60,456 $ 60,606 $ 61,419
(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 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 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, June 30, 2017
PROPERT
Y
ACQUISITION
AND DISPOSITION INFORM
ATION SINCE JANUA
RY
1, 201
7
21
PROPERTY ACQUISITION AND DISPOSITION INFORMATION SINCE JANUARY 1, 2017
(dollars in thousands)
ACQUISITIONS:
Average
Number Purchase
Date of Rooms Operating Purchase Price per
Acquired Properties Brand Location / Suites Agreement Price (1) Room / Suite
2/1/2017 1 Kimpton Hotel Allegro Chicago, IL 483 InterContinental $ 85,494 $ 177
3/31/2017 1 Kimpton Hotel Alexis Seattle, WA 121 InterContinental $ 71,625 $ 592
5/3/2017 1 Petro Stopping Centers Columbia, SC N/A TA No. 4 $ 27,602 N/A
6/2/2017 1 Royal Sonesta St. Louis, MO 389 Sonesta $ 87,614 $ 225
6/29/2017 1 Crowne Plaza Atlanta, GA 495 InterContinental $ 88,604 $ 179
8/1/2017 1 Crowne Plaza Columbus, OH 419 InterContinental $ 48,990 $ 117
Total / Weighted Average 6 1,907 $ 409,929 $ 200
(1) Represents cash purchase price and excludes acquisition related costs.
DISPOSITIONS:
Average
Number Former Sales
Date of Rooms Operating Sales Price per
Disposed Properties Brand Location / Suites Agreement Price (1) Room / Suite
8/1/2017 1 Radisson Chandler, AZ 159 Carlson $ 9,500 $ 60
(1) Represents cash selling price and excludes closing costs.
Hospitality Properties Trust
Supplemental Operating and Financial Data, June 30, 2017
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 Six Months Ended June 30,
6/30/2017 3/31/2017 12/31/2016 9/30/2016 6/30/2016 2017 2016
Net income $ 60,699 $ 37,171 $ 63,186 $ 51,812 $ 56,061 $ 97,870 $ 108,112
Add: Interest expense 45,189 43,566 37,349 41,280 41,698 88,755 83,284
Income tax expense 786 356 537 948 2,160 1,142 2,535
Depreciation and amortization 95,155 93,451 91,150 90,139 88,782 188,606 176,053
EBITDA 201,829 174,544 192,222 184,179 188,701 376,373 369,984
Add (Less): Acquisition related costs (2) — — 482 156 117 — 729
General and administrative expense paid in
common shares (3) 718 412 557 985 870 1,130 1,292
Estimated business management incentive fee (4) 17,750 19,620 (56,272) 25,036 25,920 37,370 31,236
Loss on early extinguishment of debt (5) — — — 158 — — 70
Adjusted EBITDA $ 220,297 $ 194,576 $ 136,989 $ 210,514 $ 215,608 $ 414,873 $ 403,311
(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. Acquisition costs incurred during the 2017 periods have been capitalized in purchase accounting pursuant to a change in GAAP.
(3) Amounts represent the equity compensation awarded to our trustees, our officers and certain other employees of RMR LLC.
(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, we recognize estimated business management
incentive fee expense, if any, in the first, second and third quarters. Although we recognize this expense, if any, in the first, second and third quarters 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 business management incentive fee expense amount for the year, if any, is
determined. Adjusted EBITDA includes business management incentive fee expense of $52,407 for the three months ended December 31, 2016. Business management incentive fees for 2016
were paid in cash in January 2017.
(5) 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, June 30, 2017
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 share data)
For the Three Months Ended For the Six Months Ended June 30,
6/30/2017 3/31/2017 12/31/2016 9/30/2016 6/30/2016 2017 2016
Net income available for common shareholders $ 60,699 $ 25,843 $ 58,020 $ 46,646 $ 50,895 $ 86,542 $ 97,780
Add: Depreciation and amortization 95,155 93,451 91,150 90,139 88,782 188,606 176,053
FFO available for common shareholders 155,854 119,294 149,170 136,785 139,677 275,148 273,833
Add (Less): Acquisition related costs (2) — — 482 156 117 — 729
Estimated business management incentive fees (3) 17,750 19,620 (56,272) 25,036 25,920 37,370 31,236
Loss on early extinguishment of debt (4) — — — 158 — — 70
Excess of liquidation preference over carrying
value of preferred shares redeemed (5) — 9,893 — — — 9,893 —
Normalized FFO available for common shareholders $ 173,604 $ 148,807 $ 93,380 $ 162,135 $ 165,714 $ 322,411 $ 305,868
Weighted average shares outstanding (basic) 164,123 164,120 164,120 157,217 151,408 164,121 151,405
Weighted average shares outstanding (diluted) 164,165 164,149 164,128 157,263 151,442 164,157 151,428
Basic and diluted per share common share amounts:
Net income available for common shareholders $ 0.37 $ 0.16 $ 0.35 $ 0.30 $ 0.34 $ 0.53 $ 0.65
FFO available for common shareholders $ 0.95 $ 0.73 $ 0.91 $ 0.87 $ 0.92 $ 1.68 $ 1.81
Normalized FFO available for common shareholders $ 1.06 $ 0.91 $ 0.57 $ 1.03 $ 1.09 $ 1.96 $ 2.02
(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) Represents costs associated with our acquisition activities. Acquisition costs incurred during the 2017 periods have been capitalized in purchase accounting pursuant to a change in GAAP.
(3) 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, we recognize estimated business management
incentive fee expense, if any, in the first, second and third quarters. Although we recognize this expense, if any, in the first, second and third quarters 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 business management incentive fee expense
amount for the year, if any, is determined. Normalized FFO available for common shareholders includes business management incentive fee expense of $52,407 for the three months ended
December 31, 2016. Business management incentive fees for 2016 were paid in cash in January 2017.
(4) 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.
(5) On February 10, 2017, we redeemed all 11,600,000 of our outstanding 7.125% Series D cumulative redeemable preferred shares at the stated liquidation preference of $25.00 per share plus
accrued and unpaid distributions to the date of redemption (an aggregate of $291,435). The liquidation preference of the redeemed shares exceeded the carrying amount for the redeemed
shares as of the date of redemption by $9,893, or $0.06 per share, and we reduced net income available to common shareholders in the six months ended June 30, 2017 by that excess amount.
Hospitality Properties Trust
Supplemental Operating and Financial Data, June 30, 2017
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 be
payable when all contingencies for determining such fees are known 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 alternatives to net income, net income available for common shareholders or operating
income as indicators of operating performance or as measures 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, if any, 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 be payable when all contingencies for determining such fees are
known at the end of the calendar year, and we exclude the excess of liquidation preference over carrying value of preferred shares redeemed, acquisition related costs
expensed under GAAP 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 indicators of our operating performance or as measures 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, June 30, 2017
OPERATING AGREEMENTS AND PORTFOLIO INFORMATION
TownePlace Suites Scottsdale, Scottsdale, AZ
Operator: Marriott International Inc.
Guest Rooms: 130
Hospitality Properties Trust
Supplemental Operating and Financial Data, June 30, 2017
PORTFOLIO B
Y OPER
ATING
AGREEMENT
AND MANAGER
26
PORTFOLIO BY OPERATING AGREEMENT AND MANAGER
As of June 30, 2017
(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 10% 7,610 16% $ 694,455 7% $ 91 $ 68,952 8%
Marriott (no. 234) 68 13% 9,120 19% 1,001,389 11% 110 106,360 13%
Marriott (no. 5) 1 0% 356 1% 90,078 1% 253 10,159 1%
Subtotal / Average Marriott 122 23% 17,086 36% 1,785,922 19% 105 185,471 22%
InterContinental 97 20% 15,518 32% 1,941,973 21% 125 181,485 22%
Sonesta 35 7% 6,718 14% 1,291,380 14% 192 97,134 12%
Wyndham 22 4% 3,579 7% 391,675 4% 109 28,798 4%
Hyatt 22 4% 2,724 6% 301,942 3% 111 22,037 3%
Carlson 11 2% 2,090 4% 209,895 2% 100 12,920 2%
Morgans 1 0% 372 1% 120,000 1% 323 7,595 1%
Subtotal / Average Hotels 310 60% 48,087 100% 6,042,787 64% 126 535,440 66%
TA (No. 1) 40 8% N/A N/A 671,647 7% N/A 52,305 5%
TA (No. 2) 40 8% N/A N/A 673,828 7% N/A 53,067 7%
TA (No. 3) 39 8% N/A N/A 629,741 7% N/A 53,472 7%
TA (No. 4) 40 8% N/A N/A 602,751 6% N/A 53,062 7%
TA (No. 5) 40 8% N/A N/A 877,618 9% N/A 68,841 8%
Subtotal / Average TA 199 40% N/A N/A 3,455,585 36% N/A 280,747 34%
Total / Average 509 100% 48,087 100% $ 9,498,372 100% $ 126 $ 816,187 100%
(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 which do not result in increases in minimum returns or rents.
(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, June 30, 2017
PORTFOLIO B
Y BRAN
D
27
PORTFOLIO BY BRAND
As of June 30, 2017
(dollars in thousands)
Percent of
Percent of Total
Total Number of Number of Percent of Investment
Number of Number of Rooms / Rooms / Total Per
Brand Manager Properties Properties Suites Suites Investment (1) Investment Room / Suite
Courtyard by Marriott® Marriott 71 14% 10,265 21% $ 979,789 11% $ 95
Candlewood Suites® InterContinental 61 12% 7,553 16% 586,488 6% 78
Royal Sonesta Hotels® Sonesta 5 1% 1,960 4% 563,217 6% 287
Residence Inn by Marriott® Marriott 35 7% 4,488 9% 539,364 6% 120
Crowne Plaza® InterContinental 8 2% 3,222 7% 461,624 5% 144
Sonesta ES Suites® Sonesta 25 5% 3,077 6% 443,467 5% 144
Staybridge Suites® InterContinental 19 4% 2,364 5% 331,329 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% 290,107 3% 159
Sonesta Hotels & Resorts® Sonesta 5 1% 1,681 3% 284,696 3% 169
Kimpton® Hotels & Restaurants InterContinental 3 1% 825 2% 271,545 3% 329
InterContinental Hotels and Resorts® InterContinental 3 1% 800 2% 217,981 2% 272
Marriott Hotels and Resorts® Marriott 2 0% 748 2% 131,141 1% 175
The Clift Hotel® Morgans 1 0% 372 0% 120,000 1% 323
Radisson® Hotels & Resorts Carlson 5 1% 1,128 2% 119,630 1% 106
TownePlace Suites by Marriott® Marriott 12 2% 1,321 3% 111,037 1% 84
Hawthorn Suites® Wyndham 16 3% 1,756 4% 101,568 1% 58
Country Inns & Suites by Carlson® Carlson 5 1% 753 2% 78,528 1% 104
Holiday Inn® InterContinental 3 1% 754 2% 73,006 1% 97
SpringHill Suites by Marriott® Marriott 2 0% 264 0% 24,591 0% 93
Park Plaza® Hotels & Resorts Carlson 1 0% 209 0% 11,737 0% 56
TravelCenters of America® TA 149 29% 0 N/A 2,393,267 25% N/A
Petro Stopping Centers® TA 50 10% 0 N/A 1,062,318 11% N/A
Total / Average 509 100% 48,087 100% $ 9,498,372 100% 126
(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 which do not result in increases in minimum returns or rents.
Hospitality Properties Trust
Supplemental Operating and Financial Data, June 30, 2017
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 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 the
hotels' available 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 June 30, 2017, the available balance of this security deposit was
$22,346. 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 to cover payment shortfalls up to 90% of our minimum return after the available security deposit balance has been depleted, which expires in 2019.
As of June 30, 2017, 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. Marriott has four renewal options for 15 years each. 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. 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 our 96 InterContinental branded hotels (19 Staybridge Suites®, 61 Candlewood Suites®, two InterContinental®, eight Crowne Plaza®, three Holiday Inn® and three
Kimpton® Hotels & Restaurants) in 28 states in the U.S. and Ontario, Canada to one of our TRSs. These 96 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 $7,904 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 June 30, 2017, we held a security deposit of $98,303 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 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 June 30, 2017
(dollars in thousands)
Hospitality Properties Trust
Supplemental Operating and Financial Data, June 30, 2017
OPER
ATING
AGREEMENT INFORM
ATIO
N
29
Sonesta- We lease our 35 Sonesta branded hotels (five Royal Sonesta Hotels®, five Sonesta Hotels & Resorts® and 25 Sonesta ES Suites® hotels) in 19 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 the hotels' available
cash flows after the payment of operating expenses, including certain management fees, and we are financially responsible for operating cash flow 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 managed 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 $1,407 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 June
30, 2017, the Wyndham guaranty had been depleted. This guaranty may be replenished from future cash flows from these 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 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 June 30, 2017, the available Hyatt guaranty was $20,901. 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- As of June 30, 2017, we leased 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, prior to the amendment described
below, was scheduled to expire in 2030; Carlson has two renewal options for 15 years each for all, but not less than all, of the hotels. In June 2017, we amended our agreement with Carlson
whereby we and Carlson agreed to pursue the sale of three hotels with an aggregate of 511 rooms and an aggregate net book value of $14,090 as of June 30, 2017. We sold one of these hotels in
August 2017 and entered into an agreement in July 2017 to sell a second of these hotels. The net proceeds from the sales of these three hotels will be used to fund certain renovations to the
remaining hotels operated under the Carlson agreement and we have agreed to fund up to $35,000 for renovation costs in excess of the net sales proceeds and available FF&E reserves. Our
annual minimum return and the limited guarantee cap under the Carlson agreement will increase by 8% of any amounts we fund (excluding the net sales proceeds described above). In addition,
the initial term of the management agreement and the limited guarantee provided by Carlson were extended to December 31, 2035.
We originally had a limited guaranty of $40,000 under this agreement to cover payment shortfalls of our minimum return. As of June 30, 2017, the available Carlson guaranty was $31,215. 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 June 30, 2017
(dollars in thousands)
Hospitality Properties Trust
Supplemental Operating and Financial Data, June 30, 2017
OPER
ATING
AGREEMENT INFORM
ATIO
N
30
Morgans- We lease The Clift Hotel® in San Francisco, CA to a subsidiary of Morgans. This lease is scheduled to expire in 2103 and requires annual rent to us of $7,595, which amount is
scheduled to increase on October 14, 2019 and every five years thereafter based upon consumer price index increases of no less than 10% and no more than 20% at the time of each increase.
Although the terms of this lease might have qualified this lease as a direct financing lease under GAAP, we recognize the rental income we receive from Morgans on a cash basis because of
uncertainty regarding our collection of future rent increases. In December 2016, we notified Morgans that the closing of its merger with SBE without our consent was a breach of its lease
obligations and shortly thereafter we commenced an unlawful detainer action in the California state courts to compel Morgans and SBE to surrender possession of this hotel to us. We are
pursuing this litigation and are in discussions with Morgans and SBE regarding this hotel. The outcome of this pending litigation and our discussions with Morgans and SBE is not assured, but
we believe Morgans may surrender to us possession of this hotel or that the court will determine that Morgans and SBE have breached the lease. We also believe that this hotel may require
substantial capital investment to remain competitive in its market. The continuation of our dispute with Morgans and SBE is causing us to incur legal fees. Despite the continuation of this
dispute, Morgans has paid the rents due to us through August 8, 2017; however we believe that we may suffer some loss of future rent from this hotel, at least until this hotel is renovated and
operations improve.
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, 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, 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, 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 40 travel centers (37 TravelCenters of America® branded travel centers and three 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, 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). 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 June 30, 2017
(dollars in thousands)
Hospitality Properties Trust
Supplemental Operating and Financial Data, June 30, 2017
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 Six Months Ended
No. of Rooms / June 30, June 30,
Hotels Suites 2017 2016 Change 2017 2016 Change
ADR
Marriott (no. 1) 53 7,610 $ 132.53 $ 134.47 (1.4%) $ 131.98 $ 133.04 (0.8%)
Marriott (no. 234) 68 9,120 133.13 131.12 1.5% 132.11 129.92 1.7%
Marriott (no. 5) 1 356 263.73 247.41 6.6% 266.89 252.31 5.8%
Subtotal / Average Marriott 122 17,086 135.88 135.12 0.6% 135.42 134.21 0.9%
InterContinental (1) 97 15,518 120.60 119.42 1.0% 119.24 118.88 0.3%
Sonesta (1) 35 6,718 154.82 153.73 0.7% 147.87 146.70 0.8%
Wyndham 22 3,579 103.57 102.54 1.0% 98.56 97.65 0.9%
Hyatt 22 2,724 111.71 111.53 0.2% 110.92 110.46 0.4%
Carlson 11 2,090 117.75 109.93 7.1% 116.23 110.05 5.6%
Morgans 1 372 236.99 264.55 (10.4%) 264.55 269.10 (1.7%)
All Hotels Total / Average 310 48,087 $ 129.55 $ 128.52 0.8% $ 127.78 $ 126.79 0.8%
OCCUPANCY
Marriott (no. 1) 53 7,610 74.2% 76.5% -2.3 pts 68.6% 70.8% -2.2 pts
Marriott (no. 234) 68 9,120 80.1% 81.6% -1.5 pts 76.4% 77.3% -0.9 pts
Marriott (no. 5) 1 356 85.7% 84.0% 1.7 pts 87.8% 87.0% 0.8 pts
Subtotal / Average Marriott 122 17,086 77.6% 79.4% -1.8 pts 73.2% 74.6% -1.4 pts
InterContinental (1) 97 15,518 85.7% 86.1% -0.4 pts 81.5% 81.4% 0.1 pts
Sonesta (1) 35 6,718 74.6% 71.6% 3.0 pts 69.3% 66.2% 3.1 pts
Wyndham 22 3,579 74.8% 78.6% -3.8 pts 69.6% 72.2% -2.6 pts
Hyatt 22 2,724 86.4% 86.0% 0.4 pts 83.0% 82.0% 1.0 pts
Carlson 11 2,090 70.8% 73.8% -3.0 pts 69.4% 71.0% -1.6 pts
Morgans 1 372 89.7% 95.6% -5.9 pts 87.5% 94.2% -6.7 pts
All Hotels Total / Average 310 48,087 79.8% 80.6% -0.8 pts 75.5% 75.8% -0.3 pts
RevPAR
Marriott (no. 1) 53 7,610 $ 98.34 $ 102.87 (4.4%) $ 90.54 $ 94.19 (3.9%)
Marriott (no. 234) 68 9,120 106.64 106.99 (0.3%) 100.93 100.43 0.5%
Marriott (no. 5) 1 356 226.02 207.82 8.8% 234.33 219.51 6.8%
Subtotal / Average Marriott 122 17,086 105.44 107.29 (1.7%) 99.13 100.12 (1.0%)
InterContinental (1) 97 15,518 103.35 102.82 0.5% 97.18 96.77 0.4%
Sonesta (1) 35 6,718 115.50 110.07 4.9% 102.47 97.12 5.5%
Wyndham 22 3,579 77.47 80.60 (3.9%) 68.60 70.50 (2.7%)
Hyatt 22 2,724 96.52 95.92 0.6% 92.06 90.58 1.6%
Carlson 11 2,090 83.37 81.13 2.8% 80.66 78.14 3.2%
Morgans 1 372 212.58 252.91 (15.9%) 231.48 253.49 (8.7%)
All Hotels Total / Average 310 48,087 $ 103.38 $ 103.59 (0.2%) $ 96.47 $ 96.11 0.4%
(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, June 30, 2017
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 6/30/2017 3/31/2017 12/31/2016 9/30/2016 6/30/2016
Marriott (no. 1) 53 1.28x 1.33x 1.37x 1.39x 1.38x
Marriott (no. 234) 68 1.12x 1.13x 1.14x 1.13x 1.13x
Marriott (no. 5) 1 0.80x 0.73x 0.74x 0.73x 0.62x
Subtotal Marriott 122 1.16x 1.18x 1.20x 1.21x 1.19x
InterContinental 97 1.18x 1.20x 1.21x 1.22x 1.20x
Sonesta 35 0.72x 0.73x 0.72x 0.75x 0.70x
Wyndham 22 0.83x 0.88x 0.90x 0.94x 0.92x
Hyatt 22 1.13x 1.15x 1.16x 1.17x 1.18x
Carlson 11 1.35x 1.33x 1.29x 1.27x 1.23x
Morgans 1 0.90x 1.05x 1.01x 1.07x 1.20x
Subtotal Hotels 310 1.07x 1.09x 1.10x 1.11x 1.09x
TA (No. 1) 40 1.60x 1.60x 1.64x 1.68x 1.65x
TA (No. 2) 40 1.51x 1.50x 1.52x 1.53x 1.53x
TA (No. 3) 39 1.52x 1.52x 1.57x 1.58x 1.55x
TA (No. 4) 40 1.45x 1.46x 1.55x 1.56x 1.56x
TA (No. 5) 40 1.54x 1.55x 1.58x 1.59x 1.59x
Subtotal TA 199 1.52x 1.53x 1.57x 1.59x 1.58x
Total 509 1.22x 1.24x 1.26x 1.27x 1.25x
Number of For the Three Months Ended
Operating Agreement Properties 6/30/2017 3/31/2017 12/31/2016 9/30/2016 6/30/2016
Marriott (no. 1) 53 1.51x 1.00x 1.01x 1.59x 1.72x
Marriott (no. 234) 68 1.30x 1.01x 0.95x 1.23x 1.33x
Marriott (no. 5) 1 0.76x 0.90x 0.66x 0.89x 0.48x
Subtotal Marriott 122 1.35x 1.00x 0.96x 1.34x 1.43x
InterContinental 97 1.30x 0.99x 1.05x 1.38x 1.37x
Sonesta 35 1.05x 0.46x 0.45x 0.92x 1.10x
Wyndham 22 1.19x 0.30x 0.67x 1.17x 1.38x
Hyatt 22 1.37x 1.10x 0.94x 1.12x 1.45x
Carlson 11 1.53x 1.21x 0.93x 1.72x 1.48x
Morgans 1 0.47x 1.34x 0.67x 1.13x 1.07x
Subtotal Hotels 310 1.26x 0.87x 0.87x 1.26x 1.34x
TA (No. 1) 40 1.69x 1.26x 1.56x 1.88x 1.71x
TA (No. 2) 40 1.61x 1.20x 1.51x 1.73x 1.57x
TA (No. 3) 39 1.61x 1.17x 1.47x 1.83x 1.63x
TA (No. 4) 40 1.53x 1.04x 1.46x 1.78x 1.60x
TA (No. 5) 40 1.64x 1.29x 1.56x 1.69x 1.66x
Subtotal TA 199 1.62x 1.20x 1.51x 1.78x 1.64x
Total 509 1.38x 0.99x 1.09x 1.44x 1.44x
(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.
