9. Concentration

Geographic Concentration

At December 31, 2012, our 474 properties were located in 44 states in the United States, Ontario, Canada and Puerto Rico. Between 5% and 13% of our properties, by investment, were located in each of California, Texas and Georgia. Our two hotels in Ontario, Canada and our hotel in Puerto Rico represent 1% and 2% of our hotels, by investment, respectively.

Credit Concentration

All of our managers and tenants are subsidiaries of other companies. The percentage of our minimum return payments and minimum rents, for each management or lease agreement is shown below, as of December 31, 2012.

Agreement Reference Name	Number of Properties	Minimum Return/ Minimum Rent	% of Total	Investment(1)	% of Total
Marriott (No. 1)	53	$67,656	11%	$677,948	10%
Marriott (No. 234)	68	101,837	15%	951,489	13%
Marriott (No. 5)	1	9,749	2%	90,078	1%
InterContinental	91	135,159	22%	1,362,904	19%
Sonesta No. 1	20	37,081	6%	491,638	7%
Sonesta No. 2	1	2,564	0%	31,424	0%
Hyatt	22	22,037	4%	301,942	4%
Wyndham	21	16,728	3%	235,442	3%
Carlson	11	12,920	2%	209,895	3%
Morgans	1	5,956	1%	120,000	2%
TA (No. 1)(2)	145	154,105	25%	1,951,806	27%
TA (No. 2)	40	57,720	9%	746,805	11%
Total	474	$623,512	100%	$7,171,371	100%

(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.

(2) The minimum rent amount for the TA No. 1 lease includes approximately $5,126 of ground rent due to us from TA in 2013.

Minimum return and minimum rent payments due to us under some of our hotel management agreements and leases are supported by guarantees. The guarantee provided by Marriott, with respect to the 68 hotels (Marriott No. 234) managed by Marriott is limited to $40,000 ($25,977 remaining at December 31, 2012) and expires on December 31, 2019. The guarantee provided by Hyatt, with respect to the 22 hotels managed by Hyatt is limited to $50,000 ($17,143 remaining at December 31, 2012). The guarantee provided by Carlson, with respect to the 11 hotels managed by Carlson is limited to $40,000 ($22,544 remaining at December 31, 2012). The guarantee provided by Wyndham with respect to the 21 hotels managed by Wyndham is limited to $29,000 ($21,550 remaining at December 31, 2012). These guarantees may be replenished by future cash flows from the hotels in excess of our minimum returns. The guarantee provided by Wyndham for the lease with Wyndham Vacation is unlimited. The guarantee provided by Marriott with respect to the one hotel leased by Marriott (Marriott No. 5) is unlimited and does not expire.

Security deposits support minimum return and minimum rent payments that may be due to us under some of our management agreements and leases. As of December 31, 2012, we hold security deposits for our 91 hotels managed or leased by InterContinental ($26,466). The security deposit we held for our Marriott No. 234 agreement has been exhausted, but may be replenished in the future from available cash flow.

Certain of our managed hotel portfolios had net operating results that were, in the aggregate, $76,978 and $60,265 less than the minimum returns due to us for the years ended December 31, 2012 and 2011, respectively. When the shortfalls are funded by the managers of these hotels under the terms of our operating agreements, we reflect such fundings (including security deposit applications) in our Consolidated Statements of Income and Comprehensive Income as a reduction of hotel operating expenses. The reduction to hotel operating expenses was $46,386 and $58,772 in the years ended December 31, 2012 and 2011, respectively. We had $30,592 and $1,493 of shortfalls not funded by managers during the years ended December 31, 2012 and 2011, respectively, which represents the unguaranteed portion of our minimum returns from Marriott and Sonesta.

Significant Tenant

TA is the lessee of 38% of our investments, at cost, as of December 31, 2012. See Note 8 for further information regarding our leases with TA. The following table presents summary audited financial information for TA for the years ended December 31, 2012, 2011 and 2010, as reported by TA in its Annual Report on Form 10-K for the fiscal year ended December 31, 2012.

	For the Year Ended December 31,
Operations	2012		2011		2010

Total revenues	$	7,995,724	$	7,888,857	$	5,962,481
Total cost of goods sold	6,909,724		6,850,039		5,019,630
Net income (loss)	32,198		23,574		(66,690)

Cash Flows
Net cash provided by operating activities	83,072		30,141		30,893
Net cash used in investing activities	(172,474)		(86,798)		59,544
Net cash provided by (used in) financing activities	6,322		49,547		(1,628)
Net decrease in cash	(83,066)		(7,141)		(30,236)
Cash and cash equivalents at the beginning of the period	118,255		125,396		155,632
Cash and cash equivalents at the end of the period	35,189		118,255		125,396

	As of December 31,
Financial Position	2012		2011		2010

Current assets	$	393,488	$	484,250	$	407,426
Noncurrent assets	624,793		532,281		483,666
Current liabilities	283,127		289,566		239,055
Noncurrent liabilities	381,720		408,364		412,521
Total shareholders’ equity	353,434		318,601		239,516

The summary financial information of TA is presented to comply with applicable accounting regulations of the SEC. References in our financial statements to TA’s Annual Report are included to show the source of the information only, and the other information in TA’s Annual Report is not incorporated by reference into these financial statements.