RLJ Lodging Trust Reports Second Quarter 2015 Results

- Pro forma RevPAR increased 5.0%; 8.6% excluding New York and Houston

- Pro forma Consolidated Hotel EBITDA increased 7.6%

- Repurchased 2.0 million shares for $59.8 million

BETHESDA, Md.--()--RLJ Lodging Trust (the “Company”) (NYSE: RLJ) today reported results for the three and six months ended June 30, 2015.

Highlights

  • Pro forma RevPAR increased 5.0%, Pro forma ADR increased 6.4%, and Pro forma Occupancy decreased 1.3%
  • Pro forma RevPAR increased 8.6% excluding New York and Houston
  • Pro forma Hotel EBITDA Margin increased 32 bps to 39.3%; 135 bps excluding New York and Houston
  • Pro forma Consolidated Hotel EBITDA increased 7.6% to $116.5 million
  • Adjusted FFO increased 4.7% to $98.1 million
  • Repurchased 2.0 million shares for $59.8 million
  • Acquired two hotels for $105.9 million subsequent to quarter end

“With another quarter of solid operating performance, our second quarter results not only illustrate the strength of our well-diversified portfolio, but also demonstrate our ability to continue to optimize our portfolio and return value to our shareholders,” commented Thomas J. Baltimore, Jr., President and Chief Executive Officer. “We aggressively implemented our previously announced share buyback program, and subsequent to quarter end, acquired two newly constructed hotels in bulls-eye markets, both of which we believe will create significant value for our shareholders.”

Financial and Operating Results

Performance metrics such as Occupancy, Average Daily Rate (“ADR”), Revenue Per Available Room (“RevPAR”), Hotel EBITDA, and Hotel EBITDA Margin are Pro forma. The prefix “Pro forma” as defined by the Company, denotes operating results which include results for periods prior to its ownership. Pro forma RevPAR and Pro forma Hotel EBITDA Margin are reported on a comparable basis and therefore exclude hotels sold during the period and non-comparable hotels that were not open for operation or were closed for renovations for comparable periods. Explanations of EBITDA, Adjusted EBITDA, Hotel EBITDA, FFO, and Adjusted FFO, as well as reconciliations of those measures to net income or loss, if applicable, are included at the end of this release.

Pro forma RevPAR for the three months ended June 30, 2015, increased 5.0% over the comparable period in 2014, driven by a Pro forma ADR increase of 6.4% and a Pro forma Occupancy decrease of 1.3%. Excluding New York and Houston, which experienced softness in the quarter, Pro forma RevPAR growth was 8.6%. Ten of the Company’s markets achieved double-digit RevPAR growth, including New Orleans, Northern California, Atlanta, Tampa, and Portland, which experienced RevPAR growth of 19.4%, 16.8%, 15.8%, 15.2%, and 12.5%, respectively. For the six months ended June 30, 2015, Pro forma RevPAR increased 5.1% over the comparable period in 2014, driven by a Pro forma ADR increase of 6.2% and a Pro forma Occupancy decrease of 1.0%.

Pro forma Hotel EBITDA Margin for the three months ended June 30, 2015, increased 32 basis points over the comparable period in 2014 to 39.3%. Excluding New York and Houston, Pro forma Hotel EBITDA Margin increased 135 basis points. For the six months ended June 30, 2015, Pro forma Hotel EBITDA Margin increased 33 basis points over the comparable period in 2014 to 36.2%.

Pro forma Consolidated Hotel EBITDA includes the results of non-comparable hotels. For the three months ended June 30, 2015, Pro forma Consolidated Hotel EBITDA increased $8.2 million to $116.5 million, representing a 7.6% increase over the comparable period in 2014. For the six months ended June 30, 2015, Pro forma Consolidated Hotel EBITDA increased $16.4 million to $201.5 million, representing an increase of 8.9% over the comparable period in 2014.

Adjusted EBITDA for the three months ended June 30, 2015, increased $2.8 million to $110.5 million, representing a 2.6% increase over the comparable period in 2014. For the six months ended June 30, 2015, Adjusted EBITDA increased $16.5 million to $191.5 million, representing an increase of 9.4% over the comparable period in 2014.

Adjusted FFO for the three months ended June 30, 2015, increased $4.4 million to $98.1 million, representing a 4.7% increase over the comparable period in 2014. For the six months ended June 30, 2015, Adjusted FFO increased $18.2 million to $165.3 million, representing an increase of 12.3% over the comparable period in 2014.

Adjusted FFO per diluted share and unit for the three and six months ended June 30, 2015, was $0.74 and $1.24, respectively, based on the Company’s diluted weighted-average common shares and units outstanding of 132.5 million and 132.8 million for each period, respectively.

Non-recurring items which were noteworthy for the three months ended June 30, 2015, included a gain of $0.7 million primarily associated with the sale of a hotel. For the six months ended June 30, 2015, non-recurring items included a gain of $23.0 million attributed to the sale of 21 hotels.

Non-recurring items are included in net income attributable to common shareholders but are excluded from Adjusted EBITDA and Adjusted FFO, as applicable. A complete listing of non-recurring items is provided in the Non-GAAP reconciliation tables at the end of this press release for the three and six months ended June 30, 2015 and 2014.

Net income attributable to common shareholders for the three months ended June 30, 2015, was $56.0 million, compared to $52.9 million for the comparable period in 2014. For the six months ended June 30, 2015, net income attributable to common shareholders was $103.8 million, compared to $64.8 million for the comparable period in 2014.

Net cash flow from operating activities for the six months ended June 30, 2015, totaled $145.9 million, compared to $132.0 million for the comparable period in 2014.

Dispositions

During the three months ended June 30, 2015, the Company sold the 63-room Fairfield Inn & Suites Valparaiso in Valparaiso, IN for $2.4 million.

Balance Sheet

As of June 30, 2015, the Company had $263.9 million of unrestricted cash on its balance sheet, $300.0 million available on its revolving credit facility, and $1.4 billion of debt outstanding. The Company’s ratio of net debt to Adjusted EBITDA for the trailing twelve month period ended June 30, 2015, was 3.0 times.

During the three months ended June 30, 2015, the Company paid down approximately $26.4 million of first mortgage debt.

Dividends

The Company’s Board of Trustees declared a cash dividend of $0.33 per common share of beneficial interest in the second quarter. The dividend was paid on July 15, 2015, to shareholders of record as of June 30, 2015.

Share Buyback

On May 1, 2015, the Board of Trustees authorized a share repurchase program to acquire up to $200.0 million of the Company's common shares. During the second quarter of 2015, the Company repurchased 2.0 million shares for $59.8 million at an average price per share of $29.99.

Subsequent Events

On July 1, 2015, the Company drew down the entire $150.0 million of funds available under the 2014 Seven-Year Term Loan. Additionally, the Company drew the remaining $7.0 million available under its first mortgage loan on the Marriott Louisville Downtown.

On July 7, 2015, the Company sold the 80-room Residence Inn South Bend in South Bend, IN for $5.8 million.

On July 15, 2015, the Company acquired the 164-room Hyatt Place DC/Downtown/K Street in Washington, DC for $68.0 million, or approximately $415,000 per key.

On July 20, 2015, the Company acquired the 170-room Homewood Suites Seattle/Lynnwood in Lynnwood, WA for $37.9 million, or approximately $223,000 per key.

2015 Outlook

The Company’s outlook has been updated to reflect recent acquisition and disposition activity. The outlook excludes potential future acquisitions and dispositions, which could result in a material change to the Company’s outlook. The 2015 outlook is also based on a number of other assumptions, many of which are outside the Company’s control and all of which are subject to change.

Pro forma operating guidance includes results for periods prior to the Company’s ownership and therefore assumes the hotels were owned since January 1, 2014. Pro forma guidance removes income from hotels that have been sold.

For the full year 2015, the Company anticipates:

         
    Current Outlook   Prior Outlook
Pro forma RevPAR growth (1)   4.5% to 5.5%   5.0% to 6.75%
Pro forma Hotel EBITDA Margin (1) 36.0% to 37.0% 36.0% to 37.0%
Pro forma Consolidated Hotel EBITDA $400.0M to $415.0M $405.0M to $425.0M
Corporate Cash General & Administrative   $26.0M to $27.0M   $26.0M to $27.0M

(1) Excludes non-comparable hotels. Properties closed for renovations are considered non-comparable and therefore are excluded for periods in which they are closed.

Earnings Call

The Company will conduct its quarterly analyst and investor conference call on August 6, 2015, at 11:00 a.m. (Eastern Time). The conference call can be accessed by dialing (877) 407-3982 or (201) 493-6780 for international participants and requesting RLJ Lodging Trust’s second quarter earnings conference call. Additionally, a live webcast of the conference call will be available through the Company’s website at http://rljlodgingtrust.com. A replay of the conference call webcast will be archived and available online through the Investor Relations section of the Company’s website.

About Us

RLJ Lodging Trust is a self-advised, publicly traded real estate investment trust focused on acquiring premium-branded, focused-service and compact full-service hotels. The Company owns 126 properties, comprised of 124 hotels with more than 20,600 rooms and two planned hotel conversions, located in 22 states and the District of Columbia.

Forward Looking Statements

The following information contains certain statements, other than purely historical information, including estimates, projections, statements relating to the Company’s business plans, objectives and expected operating results, and the assumptions upon which those statements are based, that are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements generally are identified by the use of the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “plan,” “may,” “will,” “will continue,” “intend,” “should,” or similar expressions. Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, beliefs, and expectations, such forward-looking statements are not predictions of future events or guarantees of future performance and the Company’s actual results could differ materially from those set forth in the forward-looking statements. Some factors that might cause such a difference include the following: the current global economic uncertainty, increased direct competition, changes in government regulations or accounting rules, changes in local, national, and global real estate conditions, declines in the lodging industry, seasonality of the lodging industry, risks related to natural disasters, such as earthquakes and hurricanes, hostilities, including future terrorist attacks or fear of hostilities that affect travel, the Company’s ability to obtain lines of credit or permanent financing on satisfactory terms, changes in interest rates, access to capital through offerings of the Company’s common and preferred shares of beneficial interest, or debt, the Company’s ability to identify suitable acquisitions, the Company’s ability to close on identified acquisitions and integrate those businesses, and inaccuracies of the Company’s accounting estimates. Given these uncertainties, undue reliance should not be placed on such statements. Except as required by law, the Company undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise. The Company cautions investors not to place undue reliance on these forward-looking statements and urges investors to carefully review the disclosures the Company makes concerning risks and uncertainties in the sections entitled “Risk Factors,” “Forward-Looking Statements,” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s Annual Report, as well as risks, uncertainties and other factors discussed in other documents filed by the Company with the SEC.

For additional information or to receive press releases via email, please visit our website: http://rljlodgingtrust.com

RLJ Lodging Trust
Non-GAAP and Accounting Commentary

Non-Generally Accepted Accounting Principles (“GAAP”) Financial Measures

The Company considers the following non-GAAP financial measures useful to investors as key supplemental measures of its performance: (1) FFO, (2) Adjusted FFO, (3) EBITDA, (4) Adjusted EBITDA, and (5) Hotel EBITDA. These non-GAAP financial measures should be considered along with, but not as alternatives to, net income or loss as a measure of its operating performance. FFO, Adjusted FFO, EBITDA, Adjusted EBITDA, and Hotel EBITDA as calculated by the Company, may not be comparable to other companies that do not define such terms exactly as the Company.

Funds From Operations (“FFO”)

The Company calculates FFO in accordance with standards established by the National Association of Real Estate Investment Trusts, or NAREIT, which defines FFO as net income or loss (calculated in accordance with GAAP), excluding gains or losses from sales of real estate, impairment, items classified by GAAP as extraordinary, the cumulative effect of changes in accounting principles, plus depreciation and amortization, and adjustments for unconsolidated partnerships and joint ventures. Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values instead have historically risen or fallen with market conditions, most real estate industry investors consider FFO to be helpful in evaluating a real estate company’s operations. The Company believes that the presentation of FFO provides useful information to investors regarding the Company’s operating performance and can facilitate comparisons of operating performance between periods and between real estate investment trusts (“REITs”), even though FFO does not represent an amount that accrues directly to common shareholders.

The Company’s calculation of FFO may not be comparable to measures calculated by other companies who do not use the NAREIT definition of FFO or do not calculate FFO per diluted share in accordance with NAREIT guidance. Additionally, FFO may not be helpful when comparing the Company to non-REITs. The Company presents FFO attributable to common shareholders, which includes unitholders of limited partnership interest (“OP units”) in RLJ Lodging Trust, L.P., the Company’s operating partnership, because the OP units are redeemable for common shares of the Company. The Company believes it is meaningful for the investor to understand FFO attributable to all common shares and OP units.

Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”)

EBITDA is defined as net income or loss excluding: (1) interest expense; (2) provision for income taxes, including income taxes applicable to sales of assets; and (3) depreciation and amortization. The Company considers EBITDA useful to an investor in evaluating and facilitating comparisons of its operating performance between periods and between REITs by removing the impact of its capital structure (primarily interest expense) and asset base (primarily depreciation and amortization) from its operating results. In addition, EBITDA is used as one measure in determining the value of hotel acquisitions and dispositions. The Company presents EBITDA attributable to common shareholders, which includes OP units, because the OP units are redeemable for common shares of the Company. The Company believes it is meaningful for the investor to understand EBITDA attributable to all common shares and OP units.

Hotel EBITDA

With respect to Consolidated Hotel EBITDA, the Company believes that excluding the effect of corporate-level expenses and non-cash items provides a more complete understanding of the operating results over which individual hotels and operators have direct control. The Company believes property-level results provide investors with supplemental information about the ongoing operational performance of the Company’s hotels and the effectiveness of third-party management companies.

Pro forma Consolidated Hotel EBITDA includes results for periods prior to ownership, includes non-comparable hotels which were not open for operation or were closed for renovations for comparable periods, and excludes sold hotels. Pro forma Hotel EBITDA excludes the results of non-comparable hotels.

Adjustments to FFO and EBITDA

The Company adjusts FFO and EBITDA for certain additional items, such as transaction and pursuit costs, the amortization of share based compensation, and certain other expenses that the Company considers outside the normal course of business. The Company believes that Adjusted FFO and Adjusted EBITDA provide useful supplemental information to investors regarding its ongoing operating performance that, when considered with net income, FFO and EBITDA, is beneficial to an investor’s understanding of its operating performance. The Company adjusts FFO and EBITDA for the following items, as applicable:

  • Transaction and Pursuit Costs: The Company excludes transaction and pursuit costs expensed during the period because it believes they do not reflect the underlying performance of the Company.
  • Non-Cash Expenses: The Company excludes the effect of certain non-cash items because it believes they do not reflect the underlying performance of the Company. The Company has excluded the amortization of share based compensation, non-cash gain or loss on the disposal of assets, non-cash debt extinguishment costs, and the accelerated amortization of deferred financing fees.
   
RLJ Lodging Trust
Consolidated Balance Sheets

(Amounts in thousands, except share and per share data)

 
June 30, December 31,
2015 2014
    (unaudited)    
Assets
Investment in hotel and other properties, net $ 3,508,958 $ 3,518,803
Cash and cash equivalents 263,881 262,458
Restricted cash reserves 59,941 63,054
Hotel and other receivables, net of allowance of $170 and $166, respectively 31,802 25,691
Deferred financing costs, net 9,483 11,421
Deferred income tax asset 7,517 7,502
Purchase deposits 7,000
Prepaid expense and other assets 33,757 42,115
Assets of hotel properties held for sale   197,335  
Total assets $ 3,922,339   $ 4,128,379  
Liabilities and Equity
Mortgage loans $ 376,939 $ 532,747
Term loans 1,025,000 1,025,000
Accounts payable and other liabilities 117,383 129,388
Deferred income tax liability 7,542 7,879
Advance deposits and deferred revenue 10,854 9,984
Accrued interest 2,743 2,783
Distributions payable 46,154   42,114  
Total liabilities 1,586,615 1,749,895
Equity
Shareholders’ equity:
Preferred shares of beneficial interest, $0.01 par value, 50,000,000 shares authorized; zero shares issued and outstanding at June 30, 2015 and December 31, 2014, respectively
Common shares of beneficial interest, $0.01 par value, 450,000,000 shares authorized; 130,133,618 and 131,964,706 shares issued and outstanding at June 30, 2015 and December 31, 2014, respectively 1,301 1,319
Additional paid-in-capital 2,363,965 2,419,731
Accumulated other comprehensive loss (17,128 ) (13,644 )
Distributions in excess of net earnings (29,793 ) (46,415 )
Total shareholders’ equity 2,318,345 2,360,991
Noncontrolling interest
Noncontrolling interest in joint venture 6,077 6,295
Noncontrolling interest in Operating Partnership 11,302   11,198  
Total noncontrolling interest 17,379   17,493  
Total equity 2,335,724   2,378,484  
Total liabilities and equity $ 3,922,339   $ 4,128,379  
   
RLJ Lodging Trust
Consolidated Statements of Operations

(Amounts in thousands, except share and per share data)

(unaudited)

 
For the three months ended June 30, For the six months ended June 30,
    2015   2014   2015   2014
Revenue    
Operating revenue
Room revenue $ 262,240 $ 259,447 $ 494,799 $ 465,472
Food and beverage revenue 29,587 27,481 58,580 50,848
Other operating department revenue 9,425   8,119   18,278   15,100  
Total revenue $ 301,252   $ 295,047   $ 571,657   $ 531,420  
Expense
Operating expense
Room expense $ 55,207 $ 54,136 $ 109,293 $ 101,657
Food and beverage expense 20,492 18,746 41,256 35,619
Management and franchise fee expense 31,677 31,052 59,719 55,865
Other operating expense 59,228   59,837   119,809   116,213  

Total property operating expense

166,604 163,771 330,077 309,354
Depreciation and amortization 37,778 35,422 74,981 68,298
Property tax, insurance and other 18,281 17,938 38,324 35,190
General and administrative 10,393 10,135 20,792 20,264
Transaction and pursuit costs 853   2,411   988   3,895  
Total operating expense 233,909   229,677   465,162   437,001  
Operating income 67,343 65,370 106,495 94,419
Other income 456 405 546 515
Interest income 363 962 808 1,285
Interest expense (12,335 ) (14,142 ) (25,843 ) (28,788 )
Income from continuing operations before income tax expense 55,827 52,595 82,006 67,431
Income tax expense (89 ) (494 ) (464 ) (788 )
Income from continuing operations 55,738 52,101 81,542 66,643
Gain (loss) on disposal of hotel properties 672   1,260   22,970   (1,297 )
Net income 56,410 53,361 104,512 65,346
Net (income) loss attributable to noncontrolling interests
Noncontrolling interest in consolidated joint venture (46 ) (79 ) 23 (45 )
 
Noncontrolling interest in common units of Operating Partnership (373 ) (378 ) (694 ) (465 )
Net income attributable to common shareholders $ 55,991   $ 52,904   $ 103,841   $ 64,836  
Basic per common share data
Net income per share attributable to common shareholders $ 0.43   $ 0.42   $ 0.79   $ 0.52  
Weighted-average number of common shares 130,670,629   125,260,607   130,969,957   123,510,507  
Diluted per common share data
Net income per share attributable to common shareholders $ 0.42   $ 0.42   $ 0.78   $ 0.52  
Weighted-average number of common shares 131,618,693   126,475,051   131,947,932   124,696,925  
 

Note:

The Statement of Comprehensive Income and corresponding notes can be found in the Company’s Quarterly Report on Form 10-Q.
   
RLJ Lodging Trust
Reconciliation of Net Income to Non-GAAP Measures

(Amounts in thousands, except per share data)

(unaudited)

 

Funds From Operations (FFO)

 
For the three months ended June 30, For the six months ended June 30,
    2015   2014   2015   2014
Net income $ 56,410   $ 53,361 $ 104,512   $ 65,346
Depreciation and amortization 37,778 35,422 74,981 68,298
(Gain) loss on disposal of hotel properties (672 ) (1,260 ) (22,970 ) 1,297
Noncontrolling interest in consolidated joint venture (46 ) (79 ) 23 (45 )
Adjustments related to consolidated joint venture (1) (43 ) (46 ) (85 ) (93 )
FFO attributable to common shareholders 93,427 87,398 156,461 134,803
Transaction and pursuit costs 853 2,411 988 3,895
Amortization of share-based compensation 3,768 3,820 7,791 7,393
Loan related costs (2) 7     97   1,073  
Adjusted FFO $ 98,055   $ 93,629   $ 165,337   $ 147,164  
 
Adjusted FFO per common share and unit-basic $ 0.75 $ 0.74 $ 1.25 $ 1.18
Adjusted FFO per common share and unit-diluted $ 0.74 $ 0.74 $ 1.24 $ 1.17
 
Basic weighted-average common shares and units outstanding (3) 131,565 126,155 131,864 124,405
Diluted weighted-average common shares and units outstanding (3) 132,513 127,369 132,842 125,591
 

Note:

(1)   Includes depreciation and amortization expense allocated to the noncontrolling interest in the joint venture.
(2) Represents debt extinguishment costs and accelerated amortization of deferred financing fees.
(3) Includes 0.9 million operating partnership units.
   
RLJ Lodging Trust
Reconciliation of Net Income to Non-GAAP Measures

(Amounts in thousands)

(unaudited)

 
Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA)
 
For the three months ended June 30, For the six months ended June 30,
    2015   2014   2015   2014
Net income $ 56,410   $ 53,361 $ 104,512   $ 65,346
Depreciation and amortization 37,778 35,422 74,981 68,298
Interest expense, net (1) 12,327 13,502 25,824 28,140
Income tax expense 89 494 464 788
Noncontrolling interest in consolidated joint venture (46 ) (79 ) 23 (45 )
Adjustments related to consolidated joint venture (2) (43 ) (46 ) (85 ) (93 )
EBITDA 106,515 102,654 205,719 162,434
Transaction and pursuit costs 853 2,411 988 3,895
(Gain) loss on disposal of hotel properties (672 ) (1,260 ) (22,970 ) 1,297
Amortization of share-based compensation 3,768   3,820   7,791   7,393  
Adjusted EBITDA 110,464 107,625 191,528 175,019
General and administrative (3) 6,625 6,315 13,001 12,871
Operating results from noncontrolling interest in joint venture 89 125 62 138
Other corporate adjustments (562 ) (157 ) (722 ) (143 )
Consolidated Hotel EBITDA 116,616   113,908   203,869   187,885  
Pro forma adjustments - Income from sold properties (145 ) (8,664 ) (2,363 ) (14,616 )
Pro forma adjustments - Income from prior ownership   3,015     11,808  
Pro forma Consolidated Hotel EBITDA 116,471   108,259   201,506   185,077  
Non-comparable hotels (4) (2,715 ) (1,071 ) (7,268 ) (2,813 )
Pro forma Hotel EBITDA $ 113,756   $ 107,188   $ 194,238   $ 182,264  
 

Note:

(1) Interest expense is net of interest income, excluding amounts attributable to investment in loans of $0.4 million and $0.8 million for the three and six months ended June 30, 2015, respectively, and $0.3 million and $0.6 million for the three and six months ended June 30, 2014, respectively.
(2) Includes depreciation, amortization, and interest expense allocated to the noncontrolling interest in the joint venture.
(3) General and administrative expenses exclude amortization of share based compensation, which is reflected in Adjusted EBITDA.
(4) Reflects the results of five non-comparable hotels that were not open for the entirety of the comparable periods: Residence Inn Atlanta Midtown/Georgia Tech, Courtyard Waikiki Beach, Hilton Cabana Miami Beach, Courtyard San Francisco Union Square, and SpringHill Suites Houston Downtown Convention Center.
         
RLJ Lodging Trust
Consolidated Debt Summary

(Amounts in thousands)

(unaudited)

 
Loan  

Base Term
(Years)

 

Maturity
(incl. extensions)

 

Floating /
Fixed

 

Interest
Rate (1)

 

Balance as of
June 30, 2015

Secured Debt
Barclays Bank - 1 hotel 10 Sep 2015 Fixed 5.44 % $ 9,939
PNC Bank - 5 hotels 4 May 2017 Floating 2.54 % 74,000
Wells Fargo - 4 hotels 3 Sep 2020 Floating (2) 4.19 % 150,000
Wells Fargo - 4 hotels 3   Oct 2021   Floating (2)   4.06 %   143,000
Weighted Average / Secured Total 3.85 % $ 376,939
 
Unsecured Debt
Credit Facility 4 Nov 2017 Floating % $
2013 Five-Year Term Loan 5 Aug 2018 Floating (2)(3) 3.07 % 400,000
2012 Five-Year Term Loan 5 Mar 2019 Floating (2) 2.72 % 400,000
2012 Seven-Year Term Loan 7 Nov 2019 Floating (2) 4.04 % 225,000
2014 Seven-Year Term Loan 7   Jan 2022   Floating   %  
Weighted Average / Unsecured Total 3.14 % $ 1,025,000
                 
Weighted Average / Total Debt             3.33 %   $ 1,401,939
 

Note:

(1) Interest rates as of June 30, 2015.
(2) The floating interest rate is hedged with an interest rate swap.
(3) Includes interest rate swap on $350.0 million.
           
RLJ Lodging Trust
Acquisitions

(unaudited)

 
Acquisitions   Location  

Acquisition
Date

 

Management
Company

  Rooms  

Gross
Purchase Price
($ in millions)

 

%
Interest

2015 Acquisitions (1)
No assets acquired through June 30, 2015
 
2014 Acquisitions (2)
Hyatt House Charlotte Center City Charlotte, NC Mar 12, 2014 Hyatt Affiliate 163 $ 32.5 100 %
Hyatt House Cypress Anaheim Cypress, CA Mar 12, 2014 Hyatt Affiliate 142 14.8 100 %
Hyatt House Emeryville SF Bay Area Emeryville, CA Mar 12, 2014 Hyatt Affiliate 234 39.3 100 %
Hyatt House San Diego Sorrento Mesa San Diego, CA Mar 12, 2014 Hyatt Affiliate 193 36.0 100 %
Hyatt House San Jose Silicon Valley San Jose, CA Mar 12, 2014 Hyatt Affiliate 164 44.2 100 %
Hyatt House San Ramon San Ramon, CA Mar 12, 2014 Hyatt Affiliate 142 20.8 100 %
Hyatt House Santa Clara Santa Clara, CA Mar 12, 2014 Hyatt Affiliate 150 40.6 100 %
Hyatt Market Street The Woodlands The Woodlands, TX Mar 12, 2014 Hyatt Corporation 70 25.8 100 %
Hyatt Place Fremont Silicon Valley Fremont, CA Mar 12, 2014 Hyatt Affiliate 151 23.5 100 %
Hyatt Place Madison Downtown Madison, WI Mar 12, 2014 Hyatt Affiliate 151 35.1 100 %
Courtyard Portland City Center Portland, OR May 22, 2014 Sage Hospitality 256 67.0 100 %
Embassy Suites Irvine Orange County Irvine, CA May 22, 2014 Sage Hospitality 293 53.0 100 %
Hilton Cabana Miami Beach Miami Beach, FL Jun 19, 2014 Highgate Hotels 231 71.7 100 %
Hyatt Atlanta Midtown Atlanta, GA Jul 14, 2014 Interstate Hotels and Resorts 194 49.5 100 %
DoubleTree Grand Key Resort (3) Key West, FL Sep 11, 2014 Interstate Hotels and Resorts 215     77.0   100 %
Total Acquisitions 2,749     $ 630.7  
 

Note:

(1) Does not include assets acquired subsequent to quarter end.
(2) Amounts are rounded for presentation purposes.
(3) Purchase price does not include $1.3 million paid for five condominium units.
     
RLJ Lodging Trust
Pro forma Operating Statistics — Top 50 Assets

(Amounts in thousands, except rooms)

(unaudited)

 
For the trailing twelve months ended June 30, 2015
 
Property   City/State   # of Rooms  

Pro forma Consolidated
Hotel EBITDA

Marriott Louisville Downtown Louisville, KY 616 $ 16,929
DoubleTree NYC Metropolitan New York, NY 764 16,018
Courtyard Austin Dtwn Conv Ctr Austin, TX 270 10,282
Hilton New York Fashion District New York, NY 280 9,707
Hilton Garden Inn New York W 35th St New York, NY 298 9,446
Courtyard Chicago Downtown Mag Mile Chicago, IL 306 8,072
Courtyard Portland City Center Portland, OR 256 7,387
Embassy Suites Tampa Dtwn Conv Ctr Tampa, FL 360 6,797
Courtyard Waikiki Beach Waikiki, HI 403 6,290
Hilton Cabana Miami Beach Miami Beach, FL 231 6,277
Renaissance Pittsburgh Hotel Pittsburgh, PA 300 6,275
Hilton Garden Inn SF Oakland Bay Bridge Emeryville, CA 278 6,144
DoubleTree Grand Key Resort Key West, FL 216 5,908
Fairfield Inn & Suites DC Downtown Washington, DC 198 5,879
Courtyard Charleston Historic District Charleston, SC 176 5,624
Residence Inn Austin Dtwn Conv Ctr Austin, TX 179 5,479
Marriott Denver South @ Park Meadows Lone Tree, CO 279 5,478
Embassy Suites Boston Waltham Waltham, MA 275 5,295
Hyatt House San Jose Silicon Valley San Jose, CA 164 5,202
Marriott Denver Airport @ Gateway Park Aurora, CO 238 4,947
Hilton Garden Inn New Orleans Conv Ctr New Orleans, LA 286 4,946
Renaissance Ft Lauderdale Plantation Plantation, FL 250 4,889
Courtyard New York Manhattan Upper East New York, NY 226 4,825
Residence Inn Bethesda Downtown Bethesda, MD 188 4,782
Hilton Garden Inn Los Angeles Hollywood Los Angeles, CA 160 4,662
Homewood Suites Washington DC Downtown Washington, DC 175 4,655
Hyatt House Emeryville SF Bay Area Emeryville, CA 234 4,558
Courtyard Houston By The Galleria Houston, TX 190 4,553
Marriott Austin South Austin, TX 211 4,378
Hyatt House Santa Clara Santa Clara, CA 150 4,320
Embassy Suites Los Angeles Downey Downey, CA 219 3,939
Residence Inn National Harbor DC Oxon Hill, MD 162 3,870
Embassy Suites Irvine Orange Cnty Arprt Irvine, CA 293 3,826
Courtyard Houston Dtwn Conv Ctr Houston, TX 191 3,666
Renaissance Boulder Flatiron Hotel Broomfield, CO 232 3,517
Residence Inn Houston By The Galleria Houston, TX 146 3,507
Residence Inn Houston Dtwn Conv Ctr Houston, TX 171 3,375
Hyatt Atlanta Midtown Atlanta, GA 194 3,337
Hyatt Place Fremont Silicon Valley Fremont, CA 151 3,291
Hyatt House Charlotte Center City Charlotte, NC 163 3,291
Residence Inn Louisville Downtown Louisville, KY 140 3,288
Residence Inn Chicago Oak Brook Oak Brook, IL 156 3,259
Hyatt Market Street The Woodlands The Woodlands, TX 70 3,229
Embassy Suites West Palm Beach Central West Palm Beach, FL 194 3,096
Hyatt House San Diego Sorrento Mesa San Diego, CA 193 3,083
Hampton Inn Houston Near The Galleria Houston, TX 176 3,057
Marriott Chicago Midway Chicago, IL 200 2,983
Hyatt House Dallas Lincoln Park Dallas, TX 155 2,685
Hilton Garden Inn Bloomington Bloomington, IN 168 2,613
Fairfield Inn & Suites Key West Key West, FL 106   2,383
Top 50 Assets 11,637 265,299
Other (1) 8,737   128,527
Total Portfolio       20,374   $ 393,826
 

Note:

The information above includes results for periods prior to the Company's ownership. The information above has not been audited and is presented only for comparison purposes. Results reflect 100% of DoubleTree NYC Metropolitan financial results, which have not been adjusted to reflect the noncontrolling interest in the joint venture.

(1)   Reflects 73 hotels, excludes two pending hotel conversions scheduled to open in the third quarter of 2015.
         
RLJ Lodging Trust
Pro forma Operating Statistics

(unaudited)

 
For the three months ended June 30, 2015
 
Top Markets       Occupancy   ADR   RevPAR  

% of
Hotel
EBITDA

# of Hotels 2015   2014   Var 2015   2014   Var 2015   2014   Var Q2
NYC 5 96.8 %   97.4 %   (0.6 )% $ 253.39   $ 265.64   (4.6 )% $ 245.29   $ 258.60   (5.1 )% 12 %
Chicago 15 77.0 % 80.4 % (4.2 )% 164.92 140.52 17.4 % 127.04 112.98 12.4 % 10 %
Austin 13 85.5 % 84.4 % 1.3 % 159.77 146.32 9.2 % 136.55 123.47 10.6 % 9 %
Denver 13 81.9 % 80.8 % 1.3 % 137.45 129.76 5.9 % 112.51 104.83 7.3 % 8 %
Houston 9 72.8 % 82.5 % (11.7 )% 170.40 169.38 0.6 % 124.08 139.66 (11.2 )% 6 %
Washington, DC 7 84.5 % 84.7 % (0.2 )% 195.81 183.52 6.7 % 165.47 155.42 6.5 % 7 %
Other 58 82.5 %   83.0 %   (0.6 )% 160.09     147.27     8.7 % 132.11     122.26     8.1 % 48 %
Total 120 82.9 %   84.0 %   (1.3 )% $ 170.55     $ 160.35     6.4 % $ 141.34     $ 134.63     5.0 % 100 %
 
Service Level       Occupancy   ADR   RevPAR  

% of
Hotel
EBITDA

# of Hotels 2015   2014   Var 2015   2014   Var 2015   2014   Var Q2
Focused-Service 99 82.5 % 84.1 % (1.8 )% $ 162.75 $ 150.10 8.4 % $ 134.34 $ 126.22 6.4 % 69 %
Compact Full-Service 20 84.7 % 84.3 % 0.5 % 186.48 182.86 2.0 % 158.03 154.15 2.5 % 26 %
Full-Service 1 74.9 %   78.2 %   (4.3 )% 215.79     208.99     3.3 % 161.56     163.44     (1.1 )% 5 %
Total 120 82.9 %   84.0 %   (1.3 )% $ 170.55     $ 160.35     6.4 % $ 141.34     $ 134.63     5.0 % 100 %
 
Chain Scale       Occupancy   ADR   RevPAR  

% of
Hotel
EBITDA

# of Hotels 2015   2014   Var 2015   2014   Var 2015   2014   Var Q2
Upper Upscale 18 81.3 % 80.8 % 0.6 % $ 177.58 $ 170.25 4.3 % $ 144.36 $ 137.55 4.9 % 24 %
Upscale 85 84.0 % 85.3 % (1.5 )% 170.40 160.36 6.3 % 143.18 136.84 4.6 % 67 %
Upper Midscale 16 80.0 % 81.7 % (2.1 )% 157.16 143.64 9.4 % 125.67 117.30 7.1 % 9 %
Midscale 1 64.6 %   93.4 %   (30.8 )% 121.74     68.14     78.7 % 78.70     63.67     23.6 %

0

%

Total 120 82.9 %   84.0 %   (1.3 )% $ 170.55     $ 160.35     6.4 % $ 141.34     $ 134.63     5.0 % 100 %
 
Flags       Occupancy   ADR   RevPAR  

% of
Hotel
EBITDA

# of Hotels 2015   2014   Var 2015   2014   Var 2015   2014   Var Q2
Residence Inn 28 83.9 % 86.5 % (3.0 )% $ 150.92 $ 140.93 7.1 % $ 126.55 $ 121.83 3.9 % 15 %
Courtyard 22 82.0 % 82.9 % (1.1 )% 173.89 161.57 7.6 % 142.63 133.95 6.5 % 19 %
Hyatt House 11 84.2 % 86.3 % (2.4 )% 163.70 147.09 11.3 % 137.90 126.97 8.6 % 9 %
Hilton Garden Inn 9 82.9 % 84.2 % (1.6 )% 181.39 173.04 4.8 % 150.31 145.68 3.2 % 9 %
SpringHill Suites 8 82.4 % 80.7 % 2.0 % 123.59 113.60 8.8 % 101.78 91.71 11.0 % 4 %
Embassy Suites 7 83.0 % 81.8 % 1.5 % 156.82 147.21 6.5 % 130.21 120.48 8.1 % 7 %
Hampton Inn 7 79.4 % 81.9 % (3.0 )% 145.51 137.01 6.2 % 115.48 112.15 3.0 % 4 %
Fairfield Inn & Suites 7 82.8 % 82.9 % (0.1 )% 170.20 152.68 11.5 % 141.00 126.62 11.4 % 4 %
Marriott 5 76.7 % 78.6 % (2.5 )% 182.04 171.92 5.9 % 139.62 135.18 3.3 % 9 %
Renaissance 3 80.5 % 78.0 % 3.2 % 161.65 158.07 2.3 % 130.16 123.27 5.6 % 4 %
DoubleTree 3 93.3 % 95.2 % (1.9 )% 230.64 237.93 (3.1 )% 215.30 226.45 (4.9 )% 6 %
Hyatt 2 79.8 % 75.2 % 6.1 % 208.41 193.42 7.8 % 166.40 145.49 14.4 % 2 %
Hyatt Place 2 89.5 % 90.8 % (1.5 )% 159.73 135.85 17.6 % 142.94 123.39 15.8 % 2 %
Hilton 1 99.5 % 99.4 % 0.1 % 277.26 289.08 (4.1 )% 275.87 287.40 (4.0 )% 3 %
Homewood Suites 1 87.7 % 85.5 % 2.5 % 248.33 232.33 6.9 % 217.81 198.73 9.6 % 2 %
Other 4 68.0 %   75.9 %   (10.3 )% 155.26     120.56     28.8 % 105.61     91.47     15.5 % 1 %
Total 120 82.9 %   84.0 %   (1.3 )% $ 170.55     $ 160.35     6.4 % $ 141.34     $ 134.63     5.0 % 100 %
 

Note:

The information above includes results for periods prior to the Company's ownership. The information has not been audited and is presented only for comparison purposes. Results reflect 100% of DoubleTree NYC Metropolitan financial results, which have not been adjusted to reflect the noncontrolling interest in the joint venture. All results exclude disposed hotels as of June 30, 2015, and five non-comparable properties.

         
RLJ Lodging Trust
Pro forma Operating Statistics

(unaudited)

 
For the six months ended June 30, 2015
 
Top Markets       Occupancy   ADR   RevPAR  

% of
Hotel
EBITDA

# of Hotels 2015   2014   Var 2015   2014   Var 2015   2014   Var Q2YTD
NYC 5 94.2 %   95.3 %   (1.1 )% $ 213.25   $ 223.62   (4.6 )% $ 200.94   $ 213.14   (5.7 )% 8 %
Chicago 15 69.7 % 72.8 % (4.1 )% 148.67 130.15 14.2 % 103.69 94.70 9.5 % 7 %
Austin 13 81.7 % 83.0 % (1.6 )% 167.91 156.17 7.5 % 137.11 129.55 5.8 % 11 %
Denver 13 73.8 % 75.3 % (2.0 )% 134.03 126.61 5.9 % 98.92 95.31 3.8 % 8 %
Houston 9 73.5 % 77.9 % (5.6 )% 169.20 165.65 2.1 % 124.43 129.06 (3.6 )% 6 %
Washington, DC 7 77.7 % 76.6 % 1.5 % 182.29 175.25 4.0 % 141.69 134.22 5.6 % 7 %
Other 58 79.7 %   79.6 %   0.2 % 161.32     148.24     8.8 % 128.58     117.95     9.0 % 53 %
Total 120 79.0 %   79.8 %   (1.0 )% $ 165.38     $ 155.73     6.2 % $ 130.71     $ 124.34     5.1 % 100 %
 
Service Level       Occupancy   ADR   RevPAR  

% of
Hotel
EBITDA

# of Hotels 2015   2014   Var 2015   2014   Var 2015   2014   Var Q2YTD
Focused-Service 99 78.2 % 79.3 % (1.4 )% $ 158.40 $ 147.10 7.7 % $ 123.95 $ 116.71 6.2 % 70 %
Compact Full-Service 20 82.0 % 82.3 % (0.3 )% 180.45 175.04 3.1 % 147.92 143.99 2.7 % 25 %
Full-Service 1 72.4 %   71.5 %   1.3 % 194.99     188.36     3.5 % 141.17     134.58     4.9 % 5 %
Total 120 79.0 %   79.8 %   (1.0 )% $ 165.38     $ 155.73     6.2 % $ 130.71     $ 124.34     5.1 % 100 %
 
Chain Scale       Occupancy   ADR   RevPAR  

% of
Hotel
EBITDA

# of Hotels 2015   2014   Var 2015   2014   Var 2015   2014   Var Q2YTD
Upper Upscale 18 78.5 % 78.0 % 0.7 % $ 174.75 $ 166.31 5.1 % $ 137.19 $ 129.69 5.8 % 26 %
Upscale 85 79.7 % 80.8 % (1.4 )% 164.14 154.80 6.0 % 130.84 125.11 4.6 % 65 %
Upper Midscale 16 76.7 % 77.4 % (0.9 )% 154.46 143.06 8.0 % 118.54 110.74 7.0 % 9 %
Midscale 1 61.7 %   84.4 %   (26.9 )% 103.80     66.73     55.6 % 64.08     56.32     13.8 %

0

%

Total 120 79.0 %   79.8 %   (1.0 )% $ 165.38     $ 155.73     6.2 % $ 130.71     $ 124.34     5.1 % 100 %
 
Flags       Occupancy   ADR   RevPAR  

% of
Hotel
EBITDA

# of Hotels 2015   2014   Var 2015   2014   Var 2015   2014   Var Q2YTD
Residence Inn 28 79.4 % 81.7 % (2.8 )% $ 149.75 $ 139.64 7.2 % $ 118.93 $ 114.11 4.2 % 16 %
Courtyard 22 77.7 % 78.0 % (0.4 )% 166.27 155.32 7.1 % 129.22 121.16 6.7 % 19 %
Hyatt House 11 78.7 % 81.7 % (3.6 )% 162.13 146.33 10.8 % 127.61 119.51 6.8 % 9 %
Hilton Garden Inn 9 80.5 % 80.1 % 0.5 % 172.33 165.49 4.1 % 138.71 132.52 4.7 % 9 %
SpringHill Suites 8 75.9 % 75.6 % 0.4 % 123.03 115.12 6.9 % 93.37 87.02 7.3 % 4 %
Embassy Suites 7 81.2 % 80.6 % 0.8 % 164.28 153.76 6.8 % 133.41 123.94 7.6 % 8 %
Hampton Inn 7 76.9 % 79.5 % (3.3 )% 144.82 136.26 6.3 % 111.38 108.36 2.8 % 4 %
Fairfield Inn & Suites 7 79.2 % 76.7 % 3.2 % 166.69 153.77 8.4 % 132.01 118.01 11.9 % 4 %
Marriott 5 73.2 % 74.4 % (1.6 )% 173.18 162.58 6.5 % 126.77 121.00 4.8 % 10 %
DoubleTree 3 90.8 % 93.7 % (3.1 )% 206.67 210.03 (1.6 )% 187.66 196.77 (4.6 )% 5 %
Renaissance 3 76.4 % 73.3 % 4.3 % 164.59 158.12 4.1 % 125.80 115.89 8.5 % 4 %
Hyatt 2 77.5 % 73.4 % 5.6 % 206.19 192.03 7.4 % 159.75 140.95 13.3 % 2 %
Hyatt Place 2 85.0 % 84.7 % 0.3 % 153.65 132.99 15.5 % 130.66 112.71 15.9 % 2 %
Hilton 1 98.0 % 99.0 % (1.0 )% 233.00 243.18 (4.2 )% 228.33 240.74 (5.2 )% 2 %
Homewood Suites 1 77.3 % 72.9 % 6.2 % 231.62 222.70 4.0 % 179.15 162.27 10.4 % 1 %
Other 4 64.1 %   71.4 %   (10.2 )% 148.85     124.48     19.6 % 95.40     88.83     7.4 % 1 %
Total 120 79.0 %   79.8 %   (1.0 )% $ 165.38     $ 155.73     6.2 % $ 130.71     $ 124.34     5.1 % 100 %
 

Note:

The information above includes results for periods prior to the Company's ownership. The information has not been audited and is presented only for comparison purposes. Results reflect 100% of DoubleTree NYC Metropolitan financial results, which have not been adjusted to reflect the noncontrolling interest in the joint venture. All results exclude disposed hotels as of June 30, 2015, and five non-comparable properties.

Contacts

RLJ Lodging Trust
Leslie D. Hale, Chief Financial Officer
301-280-7774

Release Summary

RLJ Lodging Trust Reports Second Quarter 2015 Results

Contacts

RLJ Lodging Trust
Leslie D. Hale, Chief Financial Officer
301-280-7774