v3.25.1
Segment Reporting
 3 Months Ended
Mar. 31, 2025
Segment Reporting [Abstract]  
Segment Reporting Segment Reporting
We operate in one reportable business segment within the hotel lodging industry: direct hotel investments. Direct hotel investments refers to owning hotel properties through either acquisition or new development. We report operating results of direct hotel investments on an aggregate basis as substantially all of our hotel investments; (i) offer similar products and services to their customers in the form of hotel rooms, food and beverage, and ancillary services: (ii) utilize third-party hotel management companies to deliver its products and services to its customers; (iii) are designed and operated to appeal to similar individuals, groups, leisure, and business customers; and (iv) third-party hotel managers utilize the same methods (direct hotel sales and various online booking portals) to distribute the Company’s products and services. As of March 31, 2025 and December 31, 2024, all of our hotel properties were in the U.S. and its territories. The Company’s chief operating decision maker (“CODM”) is its President and Chief Executive Officer.
Each hotel property derives revenue primarily from guestroom sales, food and beverage sales, and revenues from other lodging services and amenities. The accounting policies of each operating segment are the same as those described in the summary of significant accounting policies in note 2 of the consolidated financial statements included in our 2024 Annual Report on Form 10-K.
The CODM reviews and makes decisions on all aspects of the Company’s business using all available financial and non-financial data for each hotel individually. Capital allocation decisions to acquire, sell, enhance, redevelop, or perform renewal and replacement expenditures are determined on a hotel-by-hotel basis. Specifically, the CODM reviews the results of each hotel to assess the hotel’s profitability. The key measure the CODM uses to allocate resources and assess performance is individual hotel net income (loss) before interest expense, income taxes, depreciation, and amortization, adjusted to exclude certain items determined by management to not be reflective of its ongoing operating performance or incurred in the normal course of business (Hotel Adjusted EBITDA). The adjustments include gains and losses on hotel dispositions, impairment charges, pre-opening costs associated with extensive renovation projects, property-level legal settlements, restructuring, severance, and management transition costs, and other expenses identified by management to be non-recurring. The CODM does not regularly review asset information by segment.
The following tables include revenues, significant hotel operating expenses, and Hotel Adjusted EBITDA for the Company’s hotels, reconciled to the consolidated amounts included in the Company’s condensed consolidated statements of operations (in thousands):
Three Months Ended March 31,
20252024
REVENUE
Rooms$136,092 $138,552 
Food and beverage51,788 53,547 
Other hotel revenue27,940 26,980 
Total hotel revenue$215,820 $219,079 
EXPENSES
Rooms$28,219 $28,264 
Food and beverage40,210 40,717 
Direct expenses9,459 9,769 
Indirect expenses:
Property, general and administration15,398 16,603 
Sales and marketing13,173 13,381 
Information and telecommunications systems2,075 2,048 
Repairs and maintenance7,772 7,662 
Energy5,859 5,965 
Lease expense554 1,173 
Ownership expenses982 1,176 
Incentive management fee4,229 3,850 
Management fees6,737 6,866 
Property taxes5,951 5,710 
Other taxes468 513 
Insurance3,993 4,403 
Total expenses
145,079 148,100 
Hotel adjusted EBITDA
$70,741 $70,979 
Three Months Ended March 31,
20252024
Hotel adjusted EBITDA$70,741 $70,979 
Ownership expenses included in other hotel expenses(875)1,551 
Ownership expenses included in property taxes, insurance and other(53)(59)
Management fees(173)(110)
Depreciation and amortization(23,395)(25,420)
Advisory services fee(6,611)(6,700)
Corporate, general and administrative(2,894)2,226 
Equity in earnings (loss) of unconsolidated entities— (49)
Interest income1,888 796 
Interest expense and amortization of discounts and loan costs(24,827)(26,491)
Write-off of loan costs and exit fees(1,464)(721)
Realized and unrealized gain (loss) on derivatives(198)932 
Income tax (expense) benefit(1,467)(1,452)
Net income (loss)$10,672 $15,482