Other Investments

12 Months Ended

Dec. 31, 2024

Equity Method Investments and Joint Ventures [Abstract]

Other Investments

Other Investments

Equity Method Investment

As of both December 31, 2024 and 2023, we owned 34% of Sonesta’s outstanding common stock. We account for our 34% non-controlling interest in Sonesta under the equity method of accounting.

As of December 31, 2024 and 2023, our investment in Sonesta had a carrying value of $115,818 and $113,304, respectively. On the date of acquisition of our initial equity interest in Sonesta (February 27, 2020), the cost basis of our investment in Sonesta exceeded our proportionate share of Sonesta’s total stockholders’ equity book value by an aggregate of $8,000. As required under GAAP, we are amortizing this difference to equity in earnings of an investee over 31 years, the weighted average remaining useful life of the real estate assets and intangible assets and liabilities owned by Sonesta as of the date of our acquisition. We recorded amortization of the basis difference of $260 in each of the years ended December 31, 2024, 2023 and 2022. We recognized (losses) earnings of $(12,299), $(4,382) and $2,856 related to our investment in Sonesta for the years ended December 31, 2024, 2023 and 2022, respectively. These amounts, which include amortization of the basis difference, are included in equity in (losses) earnings of an investee in our consolidated statements of comprehensive income (loss).

We recorded a liability of $42,000 for the fair value of our initial investment in Sonesta, as no cash consideration was exchanged related to the modification of our management agreement with, and investment in, Sonesta. This liability for our investment in Sonesta is included in accounts payable and other liabilities in our consolidated balance sheets and is being amortized on a straight-line basis through the initial term of the Sonesta agreement, January 31, 2037, as a reduction to hotel operating expenses in our consolidated statements of comprehensive income (loss). We reduced hotel operating expenses by $2,484 for each of the years ended December 31, 2024, 2023 and 2022, for amortization of this liability. As of December 31, 2024 and 2023, the unamortized balance of this liability was $29,995 and $32,479, respectively.

In 2024 and 2023, we funded capital contributions to Sonesta of $15,266 and $5,134, respectively, to support its growth initiatives, including its franchising efforts. In 2022, we funded an aggregate of $45,470 of capital contributions to Sonesta related to Sonesta’s acquisition of a portfolio of four hotels located in New York, New York. We continue to maintain our 34% ownership in Sonesta after giving effect to these contributions.

Summarized financial information for Sonesta as of December 31, 2024 and 2023, and for the years ended December 31, 2024, 2023 and 2022 is as follows:

			December 31,
			2024		2023
Total current assets			$	200,461	$	171,265
Total noncurrent assets			$	725,599	$	694,828
Total current liabilities			$	178,933	$	155,935
Total noncurrent liabilities			$	373,597	$	342,839
Non-controlling interest			$	52,964	$	54,963
	Year Ended December 31,
	2024		2023		2022
Total revenues	$	815,457	$	765,011	$	681,434
Operating (loss) income	$	(12,216)	$	5,013	$	21,929
Net (loss) income	$	(36,158)	$	(10,823)	$	10,056
Net (loss) income attributable to shareholders	$	(35,452)	$	(11,404)	$	9,184

See Notes 4 and 9 for further information regarding our relationships, agreements and transactions with Sonesta.

Investment in Equity Securities

Until May 15, 2023, we owned 1,184,797 shares, or approximately 7.8%, of TA common stock, which were reported at fair value based on quoted market prices (Level 1 inputs as defined in the fair value hierarchy under GAAP) as of the end of the period, with changes in fair value recorded in earnings in our consolidated statements of comprehensive income (loss). As of May 15, 2023, our historical cost basis for these shares was $24,418 and our carrying value for these shares was $101,893. On May 15, 2023, BP Products North America Inc. acquired TA pursuant to a merger, or the TA Merger, for $86.00 per share of TA common stock in cash. We recorded a gain of $48,837 and a loss of $8,104 during the years ended December 31, 2023 and 2022, respectively, to adjust the carrying value of our former investment in shares of TA common stock to its fair value.

See Notes 4 and 9 for further information regarding our relationships, agreements and transactions with TA.