(State or Other Jurisdiction of Incorporation or Organization) | (I.R.S. Employer Identification No.) |
(Address of Principal Executive Offices) | (Zip Code) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Large accelerated filer | ☐ | ☒ | |||||||||
Non-accelerated filer | ☐ | Smaller reporting company | |||||||||
Emerging growth company |
PART I. FINANCIAL INFORMATION | Page | ||||||||||
Item 1. | Financial Statements. | ||||||||||
Item 2. | |||||||||||
Item 3. | |||||||||||
Item 4. | |||||||||||
PART II. OTHER INFORMATION | |||||||||||
Item 1. | |||||||||||
Item 1A. | |||||||||||
Item 2. | |||||||||||
Item 3. | |||||||||||
Item 4. | |||||||||||
Item 5. | |||||||||||
Item 6. | |||||||||||
March 31, 2023 | December 31, 2022 | |||||||||||||
Assets: | ||||||||||||||
Investment in Hotel Properties, Net of Accumulated Depreciation | $ | $ | ||||||||||||
Investment in Unconsolidated Joint Ventures | ||||||||||||||
Cash and Cash Equivalents | ||||||||||||||
Escrow Deposits | ||||||||||||||
Hotel Accounts Receivable | ||||||||||||||
Due from Related Parties | ||||||||||||||
Intangible Assets, Net of Accumulated Amortization of $ | ||||||||||||||
Right of Use Assets | ||||||||||||||
Other Assets | ||||||||||||||
Total Assets | $ | $ | ||||||||||||
Liabilities and Equity: | ||||||||||||||
Term Loans, Net of Unamortized Deferred Financing Costs (Note 5) | $ | $ | ||||||||||||
Unsecured Notes Payable, Net of Unamortized Deferred Financing Costs (Note 5) | ||||||||||||||
Mortgages Payable, Net of Unamortized Premium and Unamortized Deferred Financing Costs | ||||||||||||||
Lease Liabilities | ||||||||||||||
Accounts Payable, Accrued Expenses and Other Liabilities | ||||||||||||||
Dividends and Distributions Payable | ||||||||||||||
Due to Related Parties | ||||||||||||||
Total Liabilities | $ | $ | ||||||||||||
Redeemable Noncontrolling Interests - Consolidated Joint Venture (Note 1) | $ | $ | ||||||||||||
Equity: | ||||||||||||||
Shareholders' Equity: | ||||||||||||||
Preferred Shares: $ | $ | $ | ||||||||||||
Common Shares: Class A, $ | ||||||||||||||
Common Shares: Class B, $ | ||||||||||||||
Accumulated Other Comprehensive Income | ||||||||||||||
Additional Paid-in Capital | ||||||||||||||
Distributions in Excess of Net Income | ( | ( | ||||||||||||
Total Shareholders' Equity | ||||||||||||||
Noncontrolling Interests (Note 1) | ||||||||||||||
Total Equity | ||||||||||||||
Total Liabilities and Equity | $ | $ |
Three Months Ended March 31, | ||||||||||||||
2023 | 2022 | |||||||||||||
Revenue: | ||||||||||||||
Hotel Operating Revenues: | ||||||||||||||
Room | $ | $ | ||||||||||||
Food & Beverage | ||||||||||||||
Other Operating Revenues | ||||||||||||||
Other Revenues | ||||||||||||||
Total Revenues | ||||||||||||||
Operating Expenses: | ||||||||||||||
Hotel Operating Expenses: | ||||||||||||||
Room | ||||||||||||||
Food & Beverage | ||||||||||||||
Other Operating Expenses | ||||||||||||||
Property Losses in Excess of Insurance Recoveries | ||||||||||||||
Hotel Ground Rent | ||||||||||||||
Real Estate and Personal Property Taxes and Property Insurance | ||||||||||||||
General and Administrative (including Share Based Payments of $ | ||||||||||||||
Depreciation and Amortization | ||||||||||||||
Total Operating Expenses | ||||||||||||||
Operating Loss | ( | ( | ||||||||||||
Interest Income | ||||||||||||||
Interest Expense | ( | ( | ||||||||||||
Other Income (Expense) | ( | |||||||||||||
Loss on Debt Extinguishment | ( | |||||||||||||
Loss Before Results from Unconsolidated Joint Venture Investments and Income Taxes | ( | ( | ||||||||||||
Loss from Unconsolidated Joint Ventures | ( | ( | ||||||||||||
Loss Before Income Taxes | ( | ( | ||||||||||||
Income Tax Expense | ( | ( | ||||||||||||
Net Loss | ( | ( | ||||||||||||
Loss Allocated to Noncontrolling Interests - Common Units | ||||||||||||||
Income Allocated to Noncontrolling Interests - Consolidated Joint Venture | ( | ( | ||||||||||||
Preferred Distributions | ( | ( | ||||||||||||
Net Loss Applicable to Common Shareholders | $ | ( | $ | ( |
Three Months Ended March 31, | ||||||||||||||
2023 | 2022 | |||||||||||||
Loss Per Share: | ||||||||||||||
BASIC | ||||||||||||||
Loss from Continuing Operations Applicable to Common Shareholders | $ | ( | $ | ( | ||||||||||
DILUTED | ||||||||||||||
Loss from Continuing Operations Applicable to Common Shareholders | $ | ( | $ | ( | ||||||||||
Weighted Average Common Shares Outstanding: | ||||||||||||||
Basic | ||||||||||||||
Diluted* |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
Common Units and Vested LTIP Units | |||||||||||
Unvested Stock Awards and LTIP Units Outstanding | |||||||||||
Contingently Issuable Share Awards | |||||||||||
Total Potentially Dilutive Securities Excluded from the Denominator |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
Net Loss | $ | ( | $ | ( | |||||||
Other Comprehensive Income | |||||||||||
Change in Fair Value of Derivative Instruments | ( | ||||||||||
Reclassification Adjustment for Change in Fair Value of Derivative Instruments Included in Net Loss | ( | ||||||||||
Total Other Comprehensive (Loss) Income | $ | ( | $ | ||||||||
Comprehensive Loss | ( | ( | |||||||||
Less: Comprehensive Loss Attributable to Noncontrolling Interests - Common Units | |||||||||||
Less: Comprehensive Income Attributable to Noncontrolling Interests - Consolidated Joint Venture | ( | ( | |||||||||
Less: Preferred Distributions | ( | ( | |||||||||
Comprehensive Loss Attributable to Common Shareholders | $ | ( | $ | ( |
Redeemable Noncontrolling Interests | Shareholders' Equity | Noncontrolling Interests | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Consolidated Joint Venture ($) | Common Shares | Class A Common Shares ($) | Class B Common Shares ($) | Preferred Shares | Preferred Shares ($) | Additional Paid-In Capital ($) | Accumulated Other Comprehensive Income ($) | Distributions in Excess of Net Income ($) | Total Shareholders' Equity ($) | Common Units and LTIP Units | Common Units and LTIP Units ($) | Total Equity ($) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2022 | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance Costs/Other | — | — | — | — | — | — | ( | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Dividends and Distributions declared: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred Shares | — | — | — | — | — | — | — | — | ( | ( | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Common Shares ($ | — | — | — | — | — | — | — | — | ( | ( | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Common Units ($ | — | — | — | — | — | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
LTIP Units ($ | — | — | — | — | — | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Dividend Reinvestment Plan | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share Based Compensation: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Grants | — | — | — | — | ( | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Amortization | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Change in Fair Value of Derivative Instruments | — | — | — | — | — | — | — | ( | — | ( | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Adjustment to Record Noncontrolling Interest at Redemption Value | — | — | — | — | — | ( | — | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Loss | — | — | — | — | — | — | — | — | ( | ( | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance at March 31, 2023 | ( |
Redeemable Noncontrolling Interests | Shareholders' Equity | Noncontrolling Interests | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Consolidated Joint Venture ($) | Common Shares | Class A Common Shares ($) | Class B Common Shares ($) | Preferred Shares | Preferred Shares ($) | Additional Paid-In Capital ($) | Accumulated Other Comprehensive (Loss) Income ($) | Distributions in Excess of Net Income ($) | Total Shareholders' Equity ($) | Common Units and LTIP Units | Common Units and LTIP Units ($) | Total Equity ($) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2021 | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance Costs/Other | — | — | — | — | — | — | ( | — | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Dividends and Distributions declared: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred Shares | — | — | — | — | — | — | — | — | ( | ( | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share Based Compensation: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Grants | — | — | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Amortization | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Change in Fair Value of Derivative Instruments | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Adjustment to Record Noncontrolling Interest at Redemption Value | — | — | — | — | — | ( | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Income | — | — | — | — | — | — | — | — | ( | ( | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance at March 31, 2022 | ( |
Three Months Ended March 31, | ||||||||||||||
2023 | 2022 | |||||||||||||
Operating Activities: | ||||||||||||||
Net Loss | $ | ( | $ | ( | ||||||||||
Adjustments to Reconcile Net Loss to Net Cash Provided by Operating Activities: | ||||||||||||||
Property Losses in Excess of Insurance Recoveries | ||||||||||||||
Junior Note PIK Interest Added to Principal | ||||||||||||||
Depreciation | ||||||||||||||
Amortization | ||||||||||||||
Equity in Loss of Unconsolidated Joint Ventures | ||||||||||||||
Loss (Gain) Recognized on Change in Fair Value of Derivative Instrument | ( | |||||||||||||
Share Based Compensation Expense | ||||||||||||||
Change in Assets and Liabilities: | ||||||||||||||
(Increase) Decrease in: | ||||||||||||||
Hotel Accounts Receivable | ||||||||||||||
Other Assets | ||||||||||||||
Due from Related Parties | ||||||||||||||
Increase (Decrease) in: | ||||||||||||||
Due to Related Parties | ( | ( | ||||||||||||
Accounts Payable, Accrued Expenses and Other Liabilities | ( | |||||||||||||
Net Cash Provided by Operating Activities | $ | $ | ||||||||||||
Investing Activities: | ||||||||||||||
Capital Expenditures | ( | ( | ||||||||||||
Contributions to Unconsolidated Joint Ventures | ( | |||||||||||||
Net Cash Used in Investing Activities | $ | ( | $ | ( | ||||||||||
Financing Activities: | ||||||||||||||
Principal Repayment of Mortgages | ( | ( | ||||||||||||
Deferred Financing Costs | ( | |||||||||||||
Dividends Paid on Common Shares | ( | |||||||||||||
Dividends Paid on Preferred Shares | ( | ( | ||||||||||||
Distributions Paid on Common Units and LTIP Units | ( | |||||||||||||
Net Cash Used in Financing Activities | $ | ( | $ | ( | ||||||||||
Net (Decrease) Increase in Cash, Cash Equivalents, and Restricted Cash | $ | ( | $ | |||||||||||
Cash, Cash Equivalents, and Restricted Cash - Beginning of Period | ||||||||||||||
Cash, Cash Equivalents, and Restricted Cash - End of Period | $ | $ |
Dividend Per Share | ||||||||||||||||||||||||||||||||||||||
Shares Outstanding | Three Months Ended March 31, | |||||||||||||||||||||||||||||||||||||
Series | March 31, 2023 | December 31, 2022 | Aggregate Liquidation Preference | Distribution Rate | 2023 | 2022 | ||||||||||||||||||||||||||||||||
Series C | $ | % | $ | $ | ||||||||||||||||||||||||||||||||||
Series D | $ | % | $ | $ | ||||||||||||||||||||||||||||||||||
Series E | $ | % | $ | $ | ||||||||||||||||||||||||||||||||||
Total |
For the Three Months Ended | ||||||||||||||||||||
March 31, 2022 | ||||||||||||||||||||
As Previously Reported | Adjustment | As Revised | ||||||||||||||||||
Consolidated Statement of Operations: | ||||||||||||||||||||
Interest Expense | $ | ( | $ | $ | ( | |||||||||||||||
Loss Before Results from Unconsolidated Joint Venture Investments and Income Taxes | ( | ( | ||||||||||||||||||
Loss Before Income taxes | ( | ( | ||||||||||||||||||
Net Loss | ( | ( | ||||||||||||||||||
Loss Allocated to Noncontrolling Interests - Common Units | ( | |||||||||||||||||||
Net Loss Applicable to Common Shareholders | ( | ( | ||||||||||||||||||
Net Loss Per Share: | ||||||||||||||||||||
Basic - Loss from Continuing Operations Applicable to Common Shareholders | $ | ( | $ | $ | ( | |||||||||||||||
Diluted - Loss from Continuing Operations Applicable to Common Shareholders | $ | ( | $ | $ | ( | |||||||||||||||
Consolidated Statement of Comprehensive Income (Loss): | ||||||||||||||||||||
Net Loss | $ | ( | $ | $ | ( | |||||||||||||||
Reclassification Adjustment for Change in Fair Value of Derivative Instruments Included in Net Loss | ( | ( | ||||||||||||||||||
Total Other Comprehensive Income | ( | |||||||||||||||||||
Consolidated Statement of Cash Flows: | ||||||||||||||||||||
Operating Activities: | ||||||||||||||||||||
Net Loss | ( | ( | ||||||||||||||||||
Loss (Gain) Recognized on Change in Fair Value of Derivative Instrument | ( | ( |
March 31, 2023 | December 31, 2022 | |||||||||||||
Land | $ | $ | ||||||||||||
Buildings and Improvements | ||||||||||||||
Furniture, Fixtures and Equipment | ||||||||||||||
Construction in Progress | ||||||||||||||
Less Accumulated Depreciation | ( | ( | ||||||||||||
Total Investment in Hotel Properties * | $ | $ |
Hotel | Acquisition Date | Disposition Date | Consideration | Gain on Disposition | |||||||||||||||||||||||||
Urban Select Service ( | June 2005 - October 2016 | 8/4/2022, 10/26/22 | $ | $ | |||||||||||||||||||||||||
Hotel Milo Santa Barbara | 02/28/2014 | 10/06/2022 | |||||||||||||||||||||||||||
Pan Pacific Seattle | 02/21/2017 | 10/19/2022 | |||||||||||||||||||||||||||
Gate hotel JFK Airport | 06/13/2008 | 11/02/2022 | |||||||||||||||||||||||||||
2022 Total | $ |
Joint Venture | Hotel Properties | Percent Owned | March 31, 2023 | December 31, 2022 | ||||||||||||||||||||||
SB Partners, LLC | Holiday Inn Express, South Boston, MA | % | $ | $ | ||||||||||||||||||||||
SB Partners Three, LLC | Home2 Suites, South Boston, MA | % | ||||||||||||||||||||||||
$ | $ |
Three Months Ended March 31, | ||||||||||||||
2023 | 2022 | |||||||||||||
Hiren Boston, LLC* | $ | $ | ( | |||||||||||
SB Partners, LLC | ( | |||||||||||||
SB Partners Three, LLC | ( | ( | ||||||||||||
Loss from Unconsolidated Joint Venture Investments | $ | ( | $ | ( |
March 31, 2023 | December 31, 2022 | |||||||||||||
Assets | ||||||||||||||
Investment in Hotel Properties, Net | $ | $ | ||||||||||||
Other Assets | ||||||||||||||
Total Assets | $ | $ | ||||||||||||
Liabilities and Equity | ||||||||||||||
Mortgages | $ | $ | ||||||||||||
Other Liabilities | ||||||||||||||
Equity: | ||||||||||||||
Hersha Hospitality Trust | ||||||||||||||
Joint Venture Partner(s) | ( | ( | ||||||||||||
Total Equity | ( | ( | ||||||||||||
Total Liabilities and Equity | $ | $ |
Three Months Ended March 31, | ||||||||||||||
2023 | 2022 | |||||||||||||
Room Revenue | $ | $ | ||||||||||||
Other Revenue | ||||||||||||||
Operating Expenses | ( | ( | ||||||||||||
Lease Expense | ( | ( | ||||||||||||
Property Taxes and Insurance | ( | ( | ||||||||||||
General and Administrative | ( | ( | ||||||||||||
Depreciation and Amortization | ( | ( | ||||||||||||
Interest Expense | ( | ( | ||||||||||||
Income Tax Expense | ||||||||||||||
Net Loss | $ | ( | $ | ( |
March 31, 2023 | December 31, 2022 | |||||||||||||
Our share of equity recorded on the joint ventures' financial statements | $ | $ | ||||||||||||
Adjustment to reconcile our share of equity recorded on the joint ventures' financial statements to our investment in unconsolidated joint ventures(1) | ||||||||||||||
Investment in Unconsolidated Joint Ventures | $ | $ |
March 31, 2023 | December 31, 2022 | |||||||||||||
Derivative Asset | $ | $ | ||||||||||||
Deferred Financing Costs | ||||||||||||||
Prepaid Expenses | ||||||||||||||
Investment in Statutory Trusts | ||||||||||||||
Investment in Non-Hotel Property and Inventories | ||||||||||||||
Deposits with Unaffiliated Third Parties | ||||||||||||||
Deferred Tax Asset, Net of Valuation Allowance of $ | ||||||||||||||
Swap Interest Receivable | ||||||||||||||
Other | ||||||||||||||
$ | $ |
March 31, 2023 | December 31, 2022 | |||||||||||||
Mortgage Indebtedness | $ | $ | ||||||||||||
Net Unamortized Premium | ||||||||||||||
Net Unamortized Deferred Financing Costs | ( | ( | ||||||||||||
Mortgages Payable | $ | $ | ||||||||||||
Outstanding Balance | |||||||||||
March 31, 2023 | December 31, 2022 | ||||||||||
Principal | $ | $ | |||||||||
Deferred Loan Costs | ( | ( | |||||||||
Total Secured Term Loan | $ | $ |
- The Envoy Boston Seaport, Boston, MA | - Ritz-Carlton Georgetown, Washington, DC | ||||
- The Boxer, Boston, MA | - The Winter Haven Hotel Miami Beach, Miami, FL | ||||
- Hampton Inn Seaport, Seaport, New York, NY | - The Blue Moon Hotel Miami Beach, Miami, FL | ||||
- Holiday Inn Express Chelsea, 29th Street, New York, NY | - Cadillac Hotel & Beach Club, Miami, FL | ||||
- NU Hotel, Brooklyn, New York, NY | - The Parrot Key Hotel & Villas, Key West, FL | ||||
- Hyatt House White Plains, White Plains, NY | - The Ambrose Hotel, Santa Monica, CA | ||||
- The Rittenhouse, Philadelphia, PA | - Mystic Marriott Hotel & Spa, Groton, CT | ||||
- Philadelphia Westin, Philadelphia, PA | - Hilton Garden Inn JFK Airport, New York, NY | ||||
March 31, 2023 | December 31, 2022 | |||||||||||||
Statutory Trust I and Statutory Trust II Notes Payable Indebtedness | $ | $ | ||||||||||||
Net Unamortized Deferred Financing Costs | ( | ( | ||||||||||||
Statutory Trust I and Statutory Trust II Notes Payable | $ | $ | ||||||||||||
Three Months Ended March 31, | ||||||||||||||
2023 | 2022 | |||||||||||||
Mortgage Loans Payable | $ | $ | ||||||||||||
Interest Rate Swap Contracts on Mortgages | ( | |||||||||||||
Unsecured Notes Payable | ||||||||||||||
Credit Facility and Term Loans | ||||||||||||||
Interest Rate Swap Contracts on Credit Facilities | ( | |||||||||||||
Deferred Financing Costs Amortization | ||||||||||||||
Other | ||||||||||||||
Total Interest Expense | $ | $ |
Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | ||||||||||||||||||||||
Ground Lease | Office Lease | Total | Ground Lease | Office Lease | Total | ||||||||||||||||||
Operating lease costs | $ | $ | $ | $ | $ | $ | |||||||||||||||||
Variable lease costs | |||||||||||||||||||||||
Total lease costs | $ | $ | $ | $ | $ | $ |
March 31, 2023 | March 31, 2022 | |||||||
Cash paid from operating cash flow for operating leases | $ | $ | ||||||
Weighted average remaining lease term (in years) | ||||||||
Weighted average discount rate | % | % |
For the Three Months Ended | |||||||||||
March 31, 2023 | March 31, 2022 | ||||||||||
Accounting fees | $ | ||||||||||
Information technology fees | |||||||||||
Revenue management service fees |
Estimated Fair Value | ||||||||||||||||||||||||||||||||||||||||||||||||||
Asset Balance | ||||||||||||||||||||||||||||||||||||||||||||||||||
Hedged Debt | Type | Strike Rate | Index | Effective Date | Derivative Contract Maturity Date | Notional Amount | March 31, 2023 | December 31, 2022 | ||||||||||||||||||||||||||||||||||||||||||
Term Loan Instruments: | ||||||||||||||||||||||||||||||||||||||||||||||||||
Credit Facility | Swap | % | 1-Month SOFR + | August 30, 2022 | September 10, 2024 | $ | $ | |||||||||||||||||||||||||||||||||||||||||||
Credit Facility | Swap | % | 1-Month SOFR + | September 6, 2022 | August 4, 2024 | |||||||||||||||||||||||||||||||||||||||||||||
Mortgages: | ||||||||||||||||||||||||||||||||||||||||||||||||||
Hyatt, Union Square, New York, NY | Swap | % | 1-Month LIBOR + | June 7, 2019 | June 7, 2023 | |||||||||||||||||||||||||||||||||||||||||||||
Hilton Garden Inn Tribeca, New York, NY | Swap | % | 1-Month LIBOR + | July 25, 2019 | July 25, 2024 | |||||||||||||||||||||||||||||||||||||||||||||
Hilton Garden Inn Tribeca, New York, NY | Swap | % | 1-Month LIBOR + | July 25, 2019 | July 25, 2024 | |||||||||||||||||||||||||||||||||||||||||||||
Hilton Garden Inn 52nd Street, New York, NY | Cap | % | 1-Month LIBOR | December 4, 2022 | December 1, 2023 | |||||||||||||||||||||||||||||||||||||||||||||
$ | $ |
LTIP Unit Awards | Restricted Share Awards | Share Awards | ||||||||||||||||||||||||||||||||||||
Number of Units | Weighted Average Grant Date Fair Value | Number of Restricted Shares | Weighted Average Grant Date Fair Value | Number of Shares | Weighted Average Grant Date Fair Value | |||||||||||||||||||||||||||||||||
Unvested Balance as of December 31, 2022 | $ | $ | ||||||||||||||||||||||||||||||||||||
Granted | (1) | $ | ||||||||||||||||||||||||||||||||||||
Vested | ( | ( | ( | |||||||||||||||||||||||||||||||||||
Forfeited | N/A | ( | N/A | |||||||||||||||||||||||||||||||||||
Unvested Balance as of March 31, 2023 | $ | $ | ||||||||||||||||||||||||||||||||||||
Share Based Compensation Expense | Unearned Compensation | |||||||||||||||||||||||||
For the Three Months Ended | As of | |||||||||||||||||||||||||
March 31, 2023 | March 31, 2022 | March 31, 2023 | December 31, 2022 | |||||||||||||||||||||||
Issued Awards | ||||||||||||||||||||||||||
LTIP Unit Awards | $ | $ | $ | $ | ||||||||||||||||||||||
Restricted Share Awards | ||||||||||||||||||||||||||
Share Awards | ||||||||||||||||||||||||||
Unissued Awards | ||||||||||||||||||||||||||
Market Based | ||||||||||||||||||||||||||
Total | $ | $ | $ | $ |
2023 | 2024 | 2025 | 2026 | |||||||||||||||||||||||
LTIP Unit Awards | ||||||||||||||||||||||||||
Restricted Share Awards | ||||||||||||||||||||||||||
Three Months Ended March 31, | ||||||||||||||
2023 | 2022 | |||||||||||||
NUMERATOR: | ||||||||||||||
Basic and Diluted* | ||||||||||||||
Net loss | $ | ( | $ | ( | ||||||||||
Loss allocated to Noncontrolling Interests | ||||||||||||||
Distributions to Preferred Shareholders | ( | ( | ||||||||||||
Dividends Paid on Unvested Restricted Shares and LTIP Units | ( | |||||||||||||
Net loss applicable to Common Shareholders | $ | ( | $ | ( | ||||||||||
DENOMINATOR: | ||||||||||||||
Weighted average number of common shares - basic | ||||||||||||||
Effect of dilutive securities: | ||||||||||||||
Restricted Stock Awards and LTIP Units (unvested) | ||||||||||||||
Contingently Issued Shares and Units | ||||||||||||||
Weighted average number of common shares - diluted |
2023 | 2022 | |||||||||||||
Issuance of share based payments | $ | $ | ||||||||||||
Accrued payables for capital expenditures placed into service | ||||||||||||||
Adjustment to Record Noncontrolling Interest at Redemption Value | ||||||||||||||
2023 | 2022 | |||||||
Cash and cash equivalents | $ | $ | ||||||
Escrowed cash | ||||||||
Total cash, cash equivalents, and restricted cash shown in the consolidated statements of cash flows | $ | $ |
Three Months Ended | ||||||||||||||
March 31, 2023 | March 31, 2022 | |||||||||||||
Loss applicable to common shareholders | $ | (14,939) | $ | (22,235) | ||||||||||
Loss allocated to noncontrolling interest | (606) | (408) | ||||||||||||
Loss from unconsolidated joint ventures | 352 | 936 | ||||||||||||
Depreciation and amortization | 13,669 | 19,276 | ||||||||||||
Funds from consolidated hotel operations applicable to common shareholders and Partnership Units | (1,524) | (2,431) | ||||||||||||
Loss from unconsolidated joint ventures | (352) | (936) | ||||||||||||
Unrecognized pro rata interest in loss (1) | (420) | (219) | ||||||||||||
Depreciation and amortization of difference between purchase price and historical cost (2) | 19 | 21 | ||||||||||||
Interest in depreciation and amortization of unconsolidated joint ventures (3) | 536 | 627 | ||||||||||||
Funds from unconsolidated joint ventures operations applicable to common shareholders and Partnership Units | (217) | (507) | ||||||||||||
Funds from Operations applicable to common shareholders and Partnership Units | $ | (1,741) | $ | (2,938) | ||||||||||
Weighted Average Common Shares and Common Units | ||||||||||||||
Basic | 39,626,231 | 39,231,550 | ||||||||||||
Diluted | 46,659,174 | 45,476,116 |
2023 | 2024 - 2025 | 2026 - 2027 | Thereafter | Total | ||||||||||||||||||||||||||||
Fixed Rate Debt | $ | 100,547 | $ | 358,811 | $ | — | $ | — | $ | 459,358 | ||||||||||||||||||||||
Weighted Average Interest Rate | 3.99 | % | 3.93 | % | N/A | N/A | 3.96 | % | ||||||||||||||||||||||||
Floating Rate Debt | $ | 96,114 | $ | 26,091 | $ | — | $ | 51,548 | $ | 173,753 | ||||||||||||||||||||||
Weighted Average Interest Rate | 7.65 | % | 7.77 | % | N/A | 7.77 | % | 7.73 | % | |||||||||||||||||||||||
$ | 196,661 | $ | 384,902 | $ | — | $ | 51,548 | $ | 633,111 | |||||||||||||||||||||||
Exhibit No. | ||||||||
31.1 | ||||||||
31.2 | ||||||||
32.1 | ||||||||
32.2 | ||||||||
101.INS | The instance document does not appear in the interactive data file because its XBRL tags are embedded within the inline XBRL document | |||||||
101.SCH | Inline XBRL Taxonomy Extension Schema Document* | |||||||
101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document* | |||||||
101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document* | |||||||
101.LAB | Inline XBRL Taxonomy Extension Labels Linkbase Document* | |||||||
101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document* | |||||||
104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) | |||||||
* | Filed herewith | |||||||
+ | Compensatory plan or arrangement |
HERSHA HOSPITALITY TRUST | ||||||||
April 27, 2023 | /s/ Ashish R. Parikh | |||||||
Ashish R. Parikh | ||||||||
Chief Financial Officer (Principal Financial Officer) |
Date: April 27, 2023 | /s/ Neil H. Shah | ||||
Neil H. Shah | |||||
Chief Executive Officer |
Date: April 27, 2023 | /s/ Ashish R. Parikh | ||||
Ashish R. Parikh | |||||
Chief Financial Officer |
Date: April 27, 2023 | /s/ Neil H. Shah | ||||
Neil H. Shah | |||||
Chief Executive Officer |
Date: April 27, 2023 | /s/ Ashish R. Parikh | ||||
Ashish R. Parikh | |||||
Chief Financial Officer |
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands |
3 Months Ended | |||
---|---|---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|||
Revenue: | ||||
Other Revenues | $ 59 | $ 41 | ||
Total Revenues | 75,150 | 81,868 | ||
Operating Expenses: | ||||
Property Losses in Excess of Insurance Recoveries | 0 | 25 | ||
Hotel Ground Rent | 318 | 1,090 | ||
Real Estate and Personal Property Taxes and Property Insurance | 6,181 | 8,483 | ||
General and Administrative (including Share Based Payments of $2,052 and $2,541 for the three months ended March 31, 2023 and 2022, respectively) | 4,932 | 5,318 | ||
Depreciation and Amortization | 13,669 | 19,276 | ||
Total Operating Expenses | 77,814 | 83,542 | ||
Operating Loss | (2,664) | (1,674) | ||
Interest Income | 1,739 | 1 | ||
Interest Expense | (9,089) | (13,870) | ||
Other Income (Expense) | 913 | (99) | ||
Loss on Debt Extinguishment | (14) | 0 | ||
Loss Before Results from Unconsolidated Joint Venture Investments and Income Taxes | (9,115) | (15,642) | ||
Loss from Unconsolidated Joint Ventures | (352) | (936) | ||
Loss Before Income Taxes | (9,467) | (16,578) | ||
Income Tax Expense | (34) | (21) | ||
Net Loss | (9,501) | (16,599) | ||
Loss Allocated to Noncontrolling Interests - Common Units | (1,996) | (2,681) | ||
Income Allocated to Noncontrolling Interests - Consolidated Joint Venture | (1,390) | (2,273) | ||
Preferred Distributions | (6,044) | (6,044) | ||
Net Loss Applicable to Common Shareholders | $ (14,939) | $ (22,235) | ||
BASIC | ||||
Loss from Continuing Operations Applicable to Common Shareholders (in dollars per share) | $ (0.38) | $ (0.57) | ||
DILUTED | ||||
Loss from Continuing Operations Applicable to Common Shareholders (in dollars per share) | $ (0.38) | $ (0.57) | ||
Weighted Average Common Shares Outstanding: | ||||
Basic (in shares) | 39,626,231 | 39,231,550 | ||
Diluted (in shares) | [1] | 39,626,231 | 39,231,550 | |
Room | ||||
Revenue: | ||||
Hotel Operating Revenues: | $ 57,516 | $ 65,132 | ||
Operating Expenses: | ||||
Hotel Operating Expenses: | 14,469 | 14,590 | ||
Food & Beverage | ||||
Revenue: | ||||
Hotel Operating Revenues: | 10,927 | 9,056 | ||
Operating Expenses: | ||||
Hotel Operating Expenses: | 10,894 | 8,404 | ||
Other Operating Revenues | ||||
Revenue: | ||||
Hotel Operating Revenues: | 6,648 | 7,639 | ||
Operating Expenses: | ||||
Hotel Operating Expenses: | $ 27,351 | $ 26,356 | ||
|
CONSOLIDATED STATEMENTS OF OPERATIONS (Parentheticals) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Share Based Compensation Expense | $ 2,052 | $ 2,541 |
Antidilutive securities excluded from computation of earnings per share (in shares) | 7,032,943 | 6,244,565 |
Common Units and Vested LTIP Units | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 5,840,197 | 5,267,258 |
Unvested Stock Awards and LTIP Units Outstanding | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 78,391 | 681,150 |
Contingently Issuable Share Awards | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 1,114,355 | 296,157 |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract] | ||
Net Loss | $ (9,501) | $ (16,599) |
Other Comprehensive Income | ||
Change in Fair Value of Derivative Instruments | (3,979) | 15,489 |
Reclassification Adjustment for Change in Fair Value of Derivative Instruments Included in Net Loss | 7 | (367) |
Total Other Comprehensive (Loss) Income | (3,972) | 15,122 |
Comprehensive Loss | (13,473) | (1,477) |
Less: Comprehensive Loss Attributable to Noncontrolling Interests - Common Units | 2,506 | 890 |
Less: Comprehensive Income Attributable to Noncontrolling Interests - Consolidated Joint Venture | (1,390) | (2,273) |
Less: Preferred Distributions | (6,044) | (6,044) |
Comprehensive Loss Attributable to Common Shareholders | $ (18,401) | $ (8,904) |
CONSOLIDATED STATEMENTS OF EQUITY (Parenthetical) |
3 Months Ended |
---|---|
Mar. 31, 2023
$ / shares
| |
Dividends [Abstract] | |
Common shares, dividends declared (in dollars per share) | $ 0.05 |
Common units, distributions declared (in dollars per share) | 0.05 |
LTIP units, distribution per unit (in dollars per share) | $ 0.05 |
CASH FLOW DISCLOSURES AND NON CASH INVESTING AND FINANCING ACTIVITIES |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Cash Flow Elements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
CASH FLOW DISCLOSURES AND NON CASH INVESTING AND FINANCING ACTIVITIES | CASH FLOW DISCLOSURES AND NON CASH INVESTING AND FINANCING ACTIVITIES Interest paid during the three months ended March 31, 2023 and 2022 totaled $11,024 and $8,390, respectively. Net cash received on Interest Rate Derivative contracts during the three months ended March 31, 2023 totaled $2,973 and net cash paid on Interest Rate Derivative contracts during the three months ended March 31, 2022 totaled $2,496. Cash paid for income taxes during the three months ended March 31, 2023 and 2022 totaled $220 and $32, respectively. The following non-cash investing and financing activities occurred during the three months ended March 31, 2023 and 2022:
The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown in the consolidated statements of cash flows for the three months ended March 31, 2023 and 2022:
|
CASH FLOW DISCLOSURES AND NON CASH INVESTING AND FINANCING ACTIVITIES (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Cash Flow Elements [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Cash Flow | The following non-cash investing and financing activities occurred during the three months ended March 31, 2023 and 2022:
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Schedule of Cash and Cash Equivalents | The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown in the consolidated statements of cash flows for the three months ended March 31, 2023 and 2022:
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Schedule of Restrictions on Cash and Cash Equivalents | The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown in the consolidated statements of cash flows for the three months ended March 31, 2023 and 2022:
|
CASH FLOW DISCLOSURES AND NON CASH INVESTING AND FINANCING ACTIVITIES - Narrative (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Supplemental Cash Flow Elements [Abstract] | ||
Interest paid | $ 11,024 | $ 8,390 |
Net payments for interest rate derivatives | 2,973 | 2,496 |
Cash paid for income taxes | $ 220 | $ 32 |
CASH FLOW DISCLOSURES AND NON CASH INVESTING AND FINANCING ACTIVITIES - Non-cash Investing And Financing Activities (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Noncash Investing and Financing Items [Abstract] | ||
Issuance of share based payments | $ 6,819 | $ 0 |
Accrued payables for capital expenditures placed into service | 2,724 | 914 |
Adjustment to Record Noncontrolling Interest at Redemption Value | $ 1,390 | $ 2,273 |
CASH FLOW DISCLOSURES AND NON CASH INVESTING AND FINANCING ACTIVITIES - Reconciliation of Cash (Details) - USD ($) $ in Thousands |
Mar. 31, 2023 |
Dec. 31, 2022 |
Mar. 31, 2022 |
Dec. 31, 2021 |
---|---|---|---|---|
Cash, Cash Equivalents, Restricted Cash, and Restricted Cash Equivalents | ||||
Cash and cash equivalents | $ 193,574 | $ 224,955 | $ 77,447 | |
Escrowed cash | 4,557 | 5,065 | 10,997 | |
Total cash, cash equivalents, and restricted cash shown in the consolidated statements of cash flows | $ 198,131 | $ 230,020 | $ 88,444 | $ 84,945 |
BASIS OF PRESENTATION |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
BASIS OF PRESENTATION | BASIS OF PRESENTATION The accompanying unaudited consolidated financial statements of Hersha Hospitality Trust (“we,” “us,” “our” or the “Company”) have been prepared in accordance with U.S. generally accepted accounting principles (“US GAAP”) for interim financial information and with the general instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and notes required by US GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals), considered necessary for a fair presentation have been included. Operating results for the three months ended March 31, 2023 are not necessarily indicative of the results that may be expected for the year ending December 31, 2023 or any future period. Accordingly, readers of these consolidated interim financial statements should refer to the Company’s audited financial statements prepared in accordance with US GAAP, and the related notes thereto, for the year ended December 31, 2022, which are included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022, as certain footnote disclosures normally included in financial statements prepared in accordance with US GAAP have been condensed or omitted from this report pursuant to the rules of the Securities and Exchange Commission. We are a self-administered Maryland real estate investment trust that was organized in May 1998 and completed our initial public offering in January 1999. Our common shares are traded on the New York Stock Exchange (the “NYSE”) under the symbol “HT.” We own our hotels and our investments in joint ventures through our operating partnership, Hersha Hospitality Limited Partnership (“HHLP” or “the Partnership”), for which we serve as the sole general partner. As of March 31, 2023, we owned an approximate 83.2% partnership interest in HHLP, including a 1.0% general partnership interest. Principles of Consolidation and Presentation The accompanying consolidated financial statements have been prepared in accordance with US GAAP and include all of our accounts as well as accounts of the Partnership, subsidiary partnerships and our wholly owned Taxable REIT Subsidiary Lessee (“TRS Lessee”), 44 New England Management Company. All significant inter-company amounts have been eliminated. Consolidated properties are either wholly owned or owned less than 100% by the Partnership and are controlled by the Company as general partner of the Partnership. Properties owned in joint ventures are also consolidated if the determination is made that we are the primary beneficiary in a variable interest entity (“VIE”) or we maintain control of the asset through our voting interest in the entity. Variable Interest Entities We evaluate each of our investments and contractual relationships to determine whether they meet the guidelines for consolidation. To determine if we are the primary beneficiary of a VIE, we evaluate whether we have a controlling financial interest in that VIE. An enterprise is deemed to have a controlling financial interest if it has i) the power to direct the activities of a variable interest entity that most significantly impact the entity’s economic performance, and ii) the obligation to absorb losses of the VIE that could be significant to the VIE or the rights to receive benefits from the VIE that could be significant to the VIE. Control can also be demonstrated by the ability of a member to manage day-to-day operations, refinance debt and sell the assets of the partnerships without the consent of the other member and the inability of the members to replace the managing member. Based on our examination, there have been no changes to the operating structure of our legal entities during the three months ended March 31, 2023 and, therefore, there are no changes to our evaluation of VIE's as presented within our annual report presented on Form 10-K for the year ended December 31, 2022. NOTE 1 - BASIS OF PRESENTATION (CONTINUED) Noncontrolling Interest We classify the noncontrolling interests of our common units of limited partnership interest in HHLP (“Common Units”), and Long Term Incentive Plan Units (“LTIP Units”) as equity. LTIP Units are a separate class of limited partnership interest in the Operating Partnership that are convertible into Common Units under certain circumstances. The noncontrolling interest of Common Units and LTIP Units totaled $74,023 as of March 31, 2023 and $73,461 as of December 31, 2022. As of March 31, 2023, there were 8,044,927 Common Units and LTIP Units outstanding with a fair market value of $54,062, based on the price per share of our common shares on the NYSE on such date. In accordance with the partnership agreement of HHLP, holders of these Common Units may redeem them for cash unless we, in our sole and absolute discretion, elect to issue common shares on a one-for-one basis in lieu of paying cash. Net income or loss attributed to Common Units and LTIP Units is included in net income or loss but excluded from net income or loss applicable to common shareholders in the consolidated statements of operations. We are party to a joint venture that owns the Ritz-Carlton Coconut Grove, FL, in which our joint venture partner has a noncontrolling equity interest of 15% in the property. Hersha Holding RC Owner, LLC, the owner entity of the Ritz-Carlton Coconut Grove joint venture ("Ritz Coconut Grove"), will distribute income based on cash available for distribution which will be distributed as follows: (1) to us until we receive a cumulative return on our contributed senior common equity interest, currently at 8%, and (2) then to the owner of the noncontrolling interest until they receive a cumulative return on their contributed junior common equity interest, currently at 8%, and (3) then 75% to us and 25% to the owner of the noncontrolling interest until we both receive a cumulative return on our contributed senior common equity interest, currently at 12%, and (4) finally, any remaining operating profit shall be distributed 70% to us and 30% to the owner of the noncontrolling interest. Additionally, the noncontrolling interest in the Ritz Coconut Grove has the right to put their ownership interest to us for cash consideration at any time during the life of the venture. The balance sheets and financial results of the Ritz Coconut Grove are included in our consolidated financial statements and the book value of the noncontrolling interest in the Ritz Coconut Grove is classified as temporary equity within our Consolidated Balance Sheets. For Ritz Coconut Grove, income or loss is allocated using Hypothetical Liquidation at Book Value ("HLBV method") as the liquidation rights and priorities, as defined by the venture's governing agreement, differs from the underlying percentage ownership in the venture. The Company applies the HLBV method using a balance sheet approach. A calculation is prepared at each balance sheet date to determine the amount that we would receive if the venture entity were to liquidate all of its assets at carrying value and distribute that cash to the joint venture based on the contractually defined liquidation priorities. The difference between the calculated liquidation distribution amounts at the beginning and the end of the reporting period, after adjusting for capital contributions and distributions, is our share of the earnings or losses and the remainder is allocated to noncontrolling interest. The noncontrolling interest in the Ritz Coconut Grove is measured at the greater of historical cost or the put option redemption value, and is recorded as part of the (Income) Loss Allocated to Noncontrolling Interests - Consolidated Joint Venture line item within the Consolidated Statements of Operations. The value of the noncontrolling interest at the put option redemption value was $6,466 as of March 31, 2023. As such, we reclassified $1,390 from Additional Paid in Capital to Redeemable Noncontrolling Interests - Consolidated Joint Venture during the three months ended March 31, 2023 to record the noncontrolling interest at the estimated value of the put option. NOTE 1 - BASIS OF PRESENTATION (CONTINUED) Shareholders’ Equity Terms of the Series C, Series D, and Series E Preferred Shares outstanding at March 31, 2023 and December 31, 2022 are summarized as follows:
Investment in Hotel Properties Investments in hotel properties are recorded at cost. Improvements and replacements are capitalized when they extend the useful life of the asset. Costs of repairs and maintenance are expensed as incurred. Depreciation is computed using the straight-line method over the estimated useful life of up to 40 years for buildings and improvements, and to seven years for furniture, fixtures and equipment. We are required to make subjective assessments as to the useful lives of our properties for purposes of determining the amount of depreciation to record on an annual basis with respect to our investments in hotel properties. These assessments have a direct impact on our net income because if we were to shorten the expected useful lives of our investments in hotel properties we would depreciate these investments over fewer years, resulting in more depreciation expense and lower net income on an annual basis. Identifiable assets, liabilities, and noncontrolling interests related to hotel properties acquired are recorded at fair value. Estimating techniques and assumptions used in determining fair values involve significant estimates and judgments. These estimates and judgments have a direct impact on the carrying value of our assets and liabilities which can directly impact the amount of depreciation expense recorded on an annual basis and could have an impact on our assessment of potential impairment of our investment in hotel properties. We consider a hotel to be held for sale when management and our independent trustees commit to a plan to sell the property, the property is available for sale, management engages in an active program to locate a buyer for the property and it is probable the sale will be completed within a year of the initiation of the plan to sell. We evaluate each disposition to determine whether we need to classify the disposition as discontinued operations. We generally include the operations of a hotel that was sold or a hotel that has been classified as held for sale in continuing operations unless the sale represents a strategic shift that will have a major impact on our future operations and financial results. We anticipate that most of our hotel dispositions will not be classified as discontinued operations as most will not fit this definition. NOTE 1 - BASIS OF PRESENTATION (CONTINUED) Based on the occurrence of certain events or changes in circumstances, we review the recoverability of the property’s carrying value. Such events or changes in circumstances include the following: •a significant decrease in the market price of a long-lived asset; •a significant adverse change in the extent or manner in which a long-lived asset is being used or in its physical condition; •a significant adverse change in legal factors or in the business climate that could affect the value of a long-lived asset, including an adverse action or assessment by a regulator; •an accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of a long-lived asset; •a current-period operating or cash flow loss combined with a history of operating or cash flow losses or a projection or forecast that demonstrates continuing losses associated with the use of a long-lived asset; and •a current expectation that, it is more likely than not that, a long-lived asset will be sold or otherwise disposed of significantly before the end of its previously estimated useful life. We review our portfolio on an ongoing basis to evaluate the existence of any of the aforementioned events or changes in circumstances that would require us to test for recoverability. In general, our review of recoverability is based on an estimate of the future undiscounted cash flows, excluding interest charges, expected to result from the property’s use and eventual disposition. These estimates consider factors such as expected future operating income, market and other applicable trends and residual value expected, as well as the effects of hotel demand, competition and other factors. Other assumptions used in the review of recoverability include the holding period and expected terminal capitalization rate. If impairment exists due to the inability to recover the carrying value of a property, an impairment loss is recorded to the extent that the carrying value exceeds the estimated fair value of the property. We are required to make subjective assessments as to whether there are impairments in the values of our investments in hotel properties. New Accounting Pronouncements In March 2020, the Financial Accounting Standards Board ("FASB") issued ASU No. 2020-4, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting and in January 2021, the FASB issued 2021-01, Reference Rate Reform (Topic 848), Scope, which further clarified the scope of the reference rate reform optional practical expedients and exceptions outlined in Topic 848. As a result of identified structural risks of interbank offered rates, in particular, the London Interbank Offered Rate (LIBOR), reference rate reform is underway to identify alternative reference rates that are more observable or transaction based. The update provides guidance in accounting for changes in contracts, hedging relationships, and other transactions as a result of this reference rate reform. The optional expedients and exceptions contained within these updates, in general, only apply to contract amendments and modifications entered into prior to January 1, 2023. The provisions of these updates that will most likely affect our financial reporting process related to modifications of contracts with lenders and the related hedging contracts associated with each respective modified borrowing contract. In general, the provisions of these updates would impact the Company by allowing, among other things, the following: •Allowing modifications of debt contracts with lenders that fall under the guidance of ASC Topic 470 to be accounted for as a non-substantial modification and not be considered a debt extinguishment. •Allowing a change to contractual terms of a hedging instrument in conjunction with reference rate reform to not require a dedesignation of the hedging relationship. •Allowing a change to the interest rate used for margining, discounting, or contract price alignment for a derivative that is a cash flow hedge to not be considered a change to the critical terms of the hedge and will not require a dedesignation of the hedging relationship. NOTE 1 - BASIS OF PRESENTATION (CONTINUED) As disclosed in Note 8, Fair Value Measurements and Derivative Instruments, we modified interest rate swap contracts, which serve as cash flow hedges with total notional amounts of $300,000, to replace LIBOR with an alternative reference rate that matches the reference rate of the underlying hedged debt. We did not apply optional expedients and exceptions contained within these updates in the modifications of these contracts. For our remaining borrowing and hedging contracts, we have not entered into modifications as it directly relates to reference rate reform, but we anticipate having to undertake such modifications in the future as we have contracts remaining with lenders and hedging counterparties which are indexed to LIBOR. Some debt contract modifications have occurred and will occur in the normal course of business and will include other changes in the terms, for which this accounting relief is not applicable. However, we anticipate that other debt contract modifications will occur prior to the phase out of LIBOR on June 30, 2023 specifically to address the LIBOR transition, for which we will be able to apply the accounting relief. Revision of Prior Period Financial Statements During the third quarter of 2022, the Company identified immaterial errors in its previously issued financial statements resulting from the incorrect amortization of accumulated other comprehensive income related to interest rate hedges. This occurred over the periods from 2019 through 2021, thereby overstating interest expense in those periods as well as impacting certain captions in the equity section of the consolidated balance sheet, including accumulated other comprehensive income, distributions in excess of net income, and noncontrolling interests. In accordance with Staff Accounting Bulletin (“SAB”) No. 99, “Materiality,” and SAB No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements,” the Company assessed the materiality of these misstatements both quantitatively and qualitatively and determined that these errors and the related impact did not, either individually or in the aggregate, materially misstate previously issued consolidated financial statements. To reflect the correction of these immaterial errors, the Company is revising the previously issued consolidated financial statements for the three months ended March 31, 2022 in this Form 10-Q. As a result, the Company has corrected the immaterial misstatements as disclosed in the following tables for all impacted financial statement line items in prior periods.
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INVESTMENT IN HOTEL PROPERTIES |
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Property, Plant and Equipment [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INVESTMENT IN HOTEL PROPERTIES | INVESTMENT IN HOTEL PROPERTIES Investment in hotel properties consists of the following at March 31, 2023 and December 31, 2022:
* The net book value of investment in hotel property at Ritz Coconut Grove, which is a variable interest entity, is $36,951 and $37,303 at March 31, 2023 and December 31, 2022, respectively. Acquisitions For the three months ended March 31, 2023 and 2022, we acquired no hotel properties. Hotel Dispositions During the year ended December 31, 2022, we had the following hotel dispositions:
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INVESTMENT IN UNCONSOLIDATED JOINT VENTURES |
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Equity Method Investments and Joint Ventures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES | INVESTMENT IN UNCONSOLIDATED JOINT VENTURES As of March 31, 2023 and December 31, 2022, our investment in unconsolidated joint ventures consisted of the following:
Income/Loss Allocation Income or loss is allocated to us and our joint venture partners consistent with the allocation of cash distributions in accordance with the joint venture agreements. This results in an income allocation consistent with our percentage of ownership interests. When we absorb cumulative losses equal to our accounting basis in the joint venture, our investment balance is $0 as presented in the table above. Any difference between the carrying amount of any of our investments noted above and the underlying equity in net assets is amortized over the expected useful lives of the properties and other intangible assets. Loss recognized during the three months ended March 31, 2023 and 2022, for our investments in unconsolidated joint ventures is as follows:
*On November 30, 2022, we sold our 50% membership interest in Hiren Boston, LLC. The following tables set forth the total assets, liabilities, equity and components of net income or loss, including the Company’s share, related to the unconsolidated joint ventures discussed above as of March 31, 2023 and December 31, 2022 and for the three months ended March 31, 2023 and 2022. Balance Sheets
Statements of Operations
The following table is a reconciliation of our share in the unconsolidated joint ventures’ equity to our investment in the unconsolidated joint ventures as presented on our balance sheets as of March 31, 2023 and December 31, 2022.
(1) Adjustment to reconcile our share of equity recorded on the joint ventures' financial statements to our investment in unconsolidated joint ventures consists of the difference between our basis in the investment in joint ventures and the equity recorded on the joint ventures' financial statements.
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OTHER ASSETS |
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Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
OTHER ASSETS | OTHER ASSETS Other Assets Other Assets consisted of the following at March 31, 2023 and December 31, 2022:
Derivative Asset - This category represents the Company’s gross asset fair value of interest rate swaps and interest rate caps. Any swaps and caps resulting in a liability to the Company are accounted for separately within Other Liabilities on the Balance Sheet. Deferred Financing Costs – This category represents financing costs paid by the Company to establish our Line of Credit. These costs have been capitalized and will amortize to interest expense over the term of the Line of Credit. Prepaid Expenses – Prepaid expenses include amounts paid for property tax, insurance and other expenditures that will be expensed in the next twelve months. Investment in Statutory Trusts – We have an investment in the common stock of Hersha Statutory Trust I and Hersha Statutory Trust II. Investment in Non-Hotel Property and Inventories – This category represents the costs paid and capitalized by the Company for items such as office leasehold improvements, furniture and equipment, and property inventories. Deposits with Unaffiliated Third Parties – These deposits represent deposits made by the Company with unaffiliated third parties for items such as lease security deposits, utility deposits, and deposits with unaffiliated third party management companies. Deferred Tax Asset – We have $0 of net deferred tax assets as of March 31, 2023. We have considered various factors, including future reversals of existing taxable temporary differences, future projected taxable income and tax planning strategies in determining a valuation allowance for our deferred tax assets, and at the current time, we believe that it is more likely than not that we will not be able to realize the net deferred tax assets in the future, and a valuation allowance for the entire deferred tax asset has been recorded. Swap Interest Receivable – Swap Interest Receivable represents amounts due from counterparties under our swap agreements.
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DEBT |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
DEBT | DEBT Mortgages Mortgages payable at March 31, 2023 and December 31, 2022 consisted of the following:
Net Unamortized Deferred Financing Costs associated with entering into mortgage indebtedness are deferred and amortized over the life of the mortgages. Net Unamortized Premiums are also amortized over the remaining life of the loans. Mortgage indebtedness balances are subject to fixed and variable interest rates, which ranged from 4.02% to 9.00% as of March 31, 2023. Our mortgage indebtedness contains various financial and non-financial covenants customarily found in secured, non-recourse financing arrangements. Our mortgage loans payable typically require that specified debt service coverage ratios be maintained with respect to the financed properties before we can exercise certain rights under the loan agreements relating to such properties. If the specified criteria are not satisfied, the lender may be able to escrow cash flow generated by the property securing the applicable mortgage loan. We have determined that all debt covenants contained in the loan agreements securing our consolidated hotel properties were met as of March 31, 2023. As of March 31, 2023, the maturity dates for the outstanding mortgage loans ranged from June 2023 to July 2024. For mortgages with maturity dates within the next twelve months, we plan to refinance each mortgage before their maturities, or use available cash on hand or capacity under our revolving line of credit to pay the obligation. Credit Facilities On August 4, 2022, we entered into a credit agreement (the "Credit Agreement"), which provided for a secured term loan of $400,000 and secured revolving line of credit with capacity of $100,000, both of which mature on August 4, 2024. Borrowings under the Credit Agreement bear interest at a rate of Term Secured Overnight Financing Rate ("SOFR") plus a 250 basis point spread. The following table summarizes the secured term loan balances outstanding as of March 31, 2023 and December 31, 2022:
Immediately upon entering into the Credit Agreement, proceeds from the $400,000 new term loan, along with a portion of the proceeds from the dispositions discussed in Note 2 – Investment in Hotel Properties, were used to pay off and terminate all borrowings under our previous credit facility agreement ("the Prior Facilities"), which consisted of three secured credit arrangements which had an aggregate principal balance of $497,481. The Credit Agreement contains financial covenants, including a fixed charge coverage ratio of not less than 1.35 to 1.00; and a maximum leverage ratio of not more than 60%. We have determined that we are in compliance with all covenants contained in the Credit Agreement as of March 31, 2023. The amount that we can borrow at any given time under the Credit Agreement is governed by certain operating metrics of designated hotel properties known as borrowing base assets. As of March 31, 2023, the following hotel properties secure the Credit Agreement:
The weighted average interest rate on our credit facilities, including our Prior Facilities and including the effect of derivative instruments, was 4.47% and 3.51% for the three months ended March 31, 2023 and 2022, respectively. Notes Payable Notes payable at March 31, 2023 and December 31, 2022 consisted of the following:
We have two junior subordinated notes payable in the aggregate amount of $51,548 related to the Hersha Statutory Trusts pursuant to indenture agreements which will mature on July 30, 2035, but may be redeemed at our option, in whole or in part, prior to maturity in accordance with the provisions of the indenture agreements. The $25,774 of notes issued to each of Hersha Statutory Trust I and Hersha Statutory Trust II bear interest at a variable rate of LIBOR plus 3% per annum. This rate resets 2 business days prior to each quarterly payment. The related deferred financing costs are amortized over the life of the notes payable. The weighted average interest rate on our two junior subordinated notes payable was 7.67% and 3.17% for the three months ended March 31, 2023 and 2022, respectively. Interest Expense The table below summarizes interest expense incurred by the Company during the three months ended March 31, 2023 and 2022:
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LEASES |
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Leases [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
LEASES | LEASES As of March 31, 2023, we own two hotels (the Hilton Garden Inn JFK and the Annapolis Waterfront Hotel) within our consolidated portfolio of hotels where we do not own the land on which the hotels reside, rather we lease the land from an unrelated third-party lessor. Our land leases are classified as operating leases and have initial terms with extension options that range from August 2064 to October 2103. We also have two additional office space leases for our Philadelphia office and New York City office. Our Philadelphia office lease ended in March 2023, and we have subsequently entered into a new lease agreement which commenced in April 2023. Our New York City office lease term is through December 2027. Lease costs for our office spaces are included in General and Administrative expense. We disposed of the following hotels during the year ended December 31, 2022 which had ground leases that were assumed by the buyers: the Courtyard Brookline, the Gate JFK Airport, Hotel Milo, and Towneplace Suites Sunnyvale. The components of lease costs for the three months ended March 31, 2023 and 2022 were as follows:
Other information related to leases as of and for the three months ended March 31, 2023 and 2022 is as follows:
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LEASES | LEASES As of March 31, 2023, we own two hotels (the Hilton Garden Inn JFK and the Annapolis Waterfront Hotel) within our consolidated portfolio of hotels where we do not own the land on which the hotels reside, rather we lease the land from an unrelated third-party lessor. Our land leases are classified as operating leases and have initial terms with extension options that range from August 2064 to October 2103. We also have two additional office space leases for our Philadelphia office and New York City office. Our Philadelphia office lease ended in March 2023, and we have subsequently entered into a new lease agreement which commenced in April 2023. Our New York City office lease term is through December 2027. Lease costs for our office spaces are included in General and Administrative expense. We disposed of the following hotels during the year ended December 31, 2022 which had ground leases that were assumed by the buyers: the Courtyard Brookline, the Gate JFK Airport, Hotel Milo, and Towneplace Suites Sunnyvale. The components of lease costs for the three months ended March 31, 2023 and 2022 were as follows:
Other information related to leases as of and for the three months ended March 31, 2023 and 2022 is as follows:
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COMMITMENTS AND CONTINGENCIES AND RELATED PARTY TRANSACTIONS |
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Mar. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
COMMITMENTS AND CONTINGENCIES AND RELATED PARTY TRANSACTIONS | COMMITMENTS AND CONTINGENCIES AND RELATED PARTY TRANSACTIONS Management Agreements Our wholly-owned TRS, 44 New England Management Company, and certain of our joint venture entities engage eligible independent contractors in accordance with the requirements for qualification as a REIT under the Internal Revenue Code of 1986, as amended, including Hersha Hospitality Management Limited Partnership (“HHMLP”), as the property managers for hotels it leases from us pursuant to management agreements. Certain executives and trustees of the Company own a minority interest in HHMLP. Our management agreements with HHMLP provide for a term of five years and are subject to early termination upon the occurrence of defaults and certain other events described therein. As required under the REIT qualification rules, HHMLP must qualify as an “eligible independent contractor” during the term of the management agreements. Under the management agreements, HHMLP generally pays the operating expenses of our hotels. All operating expenses or other expenses incurred by HHMLP in performing its authorized duties are reimbursed or borne by our TRS to the extent the operating expenses or other expenses are incurred within the limits of the applicable approved hotel operating budget. HHMLP is not obligated to advance any of its own funds for operating expenses of a hotel or to incur any liability in connection with operating a hotel. Management agreements with other unaffiliated hotel management companies have similar terms. For its services, HHMLP receives a base management fee and, if a hotel exceeds certain thresholds, an incentive management fee. The base management fee for a hotel is due monthly and is equal to 3% of gross revenues associated with each hotel managed for the related month. The incentive management fee, if any, for a hotel is due annually in arrears on the ninetieth day following the end of each fiscal year and is based upon the financial performance of the hotels. For the three months ended March 31, 2023 and 2022, base management fees incurred to HHMLP totaled $1,698 and $1,999, respectively, and are recorded as Hotel Operating Expenses. Franchise Agreements Our branded hotel properties that are not managed by the brand are operated under franchise agreements assumed by the hotel property lessee. The franchise agreements have 10 to 20 year terms, but may be terminated by either the franchisee or franchisor on certain anniversary dates specified in the agreements. The franchise agreements require annual payments for franchise royalties, reservation, advertising services and certain other charges, and such payments are primarily based upon percentages of gross room revenue. These payments are paid by the hotels and charged to expense as incurred. Franchise fee expenses for the three months ended March 31, 2023 and 2022 were $2,669 and $3,052, respectively, and are recorded in Hotel Operating Expenses. The initial fees incurred to enter into the franchise agreements are amortized over the life of the franchise agreements. Accounting, Revenue Management and Information Technology Fees Each of the wholly-owned hotels and consolidated joint venture hotel properties managed by HHMLP incurs a monthly accounting and information technology fee. Monthly fees for accounting services are between $2 and $3 per property and monthly information technology fees range from $1 to $2 per property. Revenue management service fees are incurred to reimburse HHMLP for costs related to corporate level direct sales and sales support, and are allocated based on total hotel revenue. For the three months ended March 31, 2023 and 2022, the Company incurred the following fees which are included in Hotel Operating Expenses under Other:
Capital Expenditure Fees HHMLP charges fees between 3% and 5% on certain capital expenditures and pending renovation projects at the properties as compensation for procurement services related to capital expenditures and for project management of renovation projects. For the three months ended March 31, 2023 and 2022, we incurred fees of $304 and $83, respectively, which were capitalized with the cost of capital expenditures. Acquisitions from Affiliates We have entered into an option agreement with certain of our officers and trustees such that we obtain a right of first refusal to purchase any hotel owned or developed in the future by these individuals or entities controlled by them at fair market value. This right of first refusal would apply to each party until one year after such party ceases to be an officer or trustee of the Company. Our Acquisition Committee of the Board of Trustees is comprised solely of independent trustees, and the purchase prices and all material terms of the purchase of hotels from related parties are approved by the Acquisition Committee. Hotel Supplies We purchase certain hotel supplies and make certain capital expenditures from Hersha Purchasing and Design (HPD), a hotel supply company owned, in part, by certain executives and trustees of the Company. We did not incur charges for hotel supplies purchased from HPD for the three months ended March 31, 2023 and 2022. For the three months ended March 31, 2023 and 2022, we incurred charges of $888 and $889, respectively, for capital expenditure purchases from HPD. Hotel supplies are expensed and included in Hotel Operating Expenses on our consolidated statements of operations, and capital expenditure purchases are included in investment in hotel properties on our consolidated balance sheets. Insurance Services The Company utilizes the services of HHMLP to provide risk management services to the Company related to the placement of property and casualty insurance, placement of general liability insurance and claims handling for our hotel properties. The fees incurred for these risk management services for the three months ended March 31, 2023 and 2022 were $20 and $30, respectively. Restaurant Lease Agreements with Independent Restaurant Group The Company has entered into management agreements with Independent Restaurant Group (“IRG”), owned, in part, by certain executives and trustees of the Company. IRG is subject to the supervision of HHMLP, as property manager, for restaurants at two of its hotel properties. For the three months ended March 31, 2023 and 2022, management fees incurred to IRG totaled $74 and $43, respectively. Due From Related Parties The due from related parties balance as of March 31, 2023 and December 31, 2022 was approximately $147 and $245, respectively. The balances primarily consist of asset management fees due from our unconsolidated joint ventures. Due to Related Parties The balance due to related parties as of March 31, 2023 and December 31, 2022 was $2,239 and $2,610, respectively. The balance at March 31, 2023 and December 31, 2022 primarily consisted of amounts due to HHMLP for monthly management fees discussed above.
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FAIR VALUE MEASUREMENTS AND DERIVATIVE INSTRUMENTS |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
FAIR VALUE MEASUREMENTS AND DERIVATIVE INSTRUMENTS | FAIR VALUE MEASUREMENTS AND DERIVATIVE INSTRUMENTS Fair Value Measurements Our determination of fair value measurements are based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, we utilize a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy). Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access. Level 2 inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs may include quoted prices for similar assets and liabilities in active markets, as well as inputs that are observable for the asset or liability (other than quoted prices), such as interest rates, foreign exchange rates and yield curves that are observable at commonly quoted intervals. Level 3 inputs are unobservable inputs for the asset or liabilities, which are typically based on an entity’s own assumptions, as there is little, if any, related market activity. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the asset or liability. As of March 31, 2023, the Company’s derivative instruments represented the only financial instruments measured at fair value. Currently, the Company uses derivative instruments, such as interest rate swaps and caps, to manage its interest rate risk. The valuation of these instruments is determined using widely accepted valuation techniques, including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs. We incorporate credit valuation adjustments to appropriately reflect both our own nonperformance risk and the respective counter-party’s nonperformance risk in the fair value measurements. In adjusting the fair value of its derivative contracts for the effect of nonperformance risk, we have considered the impact of netting and any applicable credit enhancements, such as collateral postings, thresholds, mutual puts and guarantees. Although we have determined that the majority of the inputs used to value our derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with our derivatives utilize Level 3 inputs, such as estimates of current credit spreads, to evaluate the likelihood of default by us and the counter-parties. However, as of March 31, 2023 we have assessed the significance of the effect of the credit valuation adjustments on the overall valuation of our derivative positions and have determined that the credit valuation adjustments are not significant to the overall valuation of our derivatives. As a result, we have determined that our derivative valuations in their entirety are classified in Level 2 of the fair value hierarchy. Derivative Instruments The Company’s objective in using derivatives is to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish this objective, the Company primarily uses interest rate swaps and interest rate caps as part of its cash flow hedging strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable-rate amounts in exchange for fixed-rate payments over the life of the agreements without exchange of the underlying principal amount. Interest rate caps designated as cash flow hedges limit the Company’s exposure to increased cash payments due to increases in variable interest rates. The following table presents our derivative instruments as of March 31, 2023 and December 31, 2022:
The fair value of the interest rate swaps and cap are included in Other Assets at March 31, 2023 and December 31, 2022. The net change related to derivative instruments designated as cash flow hedges recognized as unrealized gains reflected on our consolidated balance sheet in accumulated other comprehensive income was a (loss)/gain of $(3,972) and $15,122 for the three months ended March 31, 2023 and 2022, respectively. Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to interest expense as interest payments are made and received on the Company’s variable-rate derivatives. The change in net unrealized gains/losses on cash flow hedges reflects a reclassification of $7 and $(367) of net unrealized gains from accumulated other comprehensive income as an increase/decrease to interest expense for the three months ended March 31, 2023 and 2022, respectively. For the next twelve months ending March 31, 2024, we estimate that an additional $11,490 will be reclassified as a decrease to interest expense. Fair Value of Debt We estimate the fair value of our fixed rate debt and the credit spreads over variable market rates on our variable rate debt by discounting the future cash flows of each instrument at estimated market rates or credit spreads consistent with the maturity of the debt obligation with similar credit policies. Credit spreads take into consideration general market conditions and maturity. The inputs utilized in estimating the fair value of debt are classified in Level 2 of the fair value hierarchy. As of March 31, 2023, the carrying value and estimated fair value of our debt was $630,080 and $610,845, respectively. As of December 31, 2022, the carrying value and estimated fair value of our debt was $629,885 and $610,401, respectively.
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SHARE BASED PAYMENTS |
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Share-Based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SHARE BASED PAYMENTS | SHARE BASED PAYMENTS A summary of our share based compensation activity from December 31, 2022 to March 31, 2023 is as follows:
(1) On March 22, 2023, 1,104,874 Units were issued to the executive officers in settlement of the 2022 Short Term Incentive Program. These Units vest on December 31, 2024, the two year anniversary following the end of the performance period and were determined by dividing the dollar amount of award earned by $9.32, the per share volume weighted average trading price of the Company's common shares on the NYSE for the 20 trading days prior to December 31, 2022. The following table summarizes share based compensation expense for the three months ended March 31, 2023 and 2022 and unearned compensation as of March 31, 2023 and December 31, 2022:
The weighted-average period of which the unrecognized compensation expense will be recorded is approximately 1.0 years for LTIP Unit Awards and 0.9 years for Restricted Share Awards. The remaining unvested target units are expected to vest as follows:
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EARNINGS PER SHARE |
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Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
EARNINGS PER SHARE | EARNINGS PER SHARE The following table is a reconciliation of the income or loss (numerator) and the weighted average shares (denominator) used in the calculation of basic and diluted earnings per common share. The computation of basic and diluted earnings per share is presented below.
*Loss allocated to noncontrolling interest in HHLP has been excluded from the numerator and Common Units and Vested LTIP Units have been omitted from the denominator for the purpose of computing diluted earnings per share since including these amounts in the numerator and denominator would have no impact. In addition, potentially dilutive common shares, if any, have been excluded from the denominator if they are anti-dilutive to loss applicable to common shareholders.
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BASIS OF PRESENTATION (Policies) |
3 Months Ended |
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Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Principles of Consolidation and Presentation | Principles of Consolidation and Presentation The accompanying consolidated financial statements have been prepared in accordance with US GAAP and include all of our accounts as well as accounts of the Partnership, subsidiary partnerships and our wholly owned Taxable REIT Subsidiary Lessee (“TRS Lessee”), 44 New England Management Company. All significant inter-company amounts have been eliminated. |
Variable Interest Entities | Variable Interest Entities We evaluate each of our investments and contractual relationships to determine whether they meet the guidelines for consolidation. To determine if we are the primary beneficiary of a VIE, we evaluate whether we have a controlling financial interest in that VIE. An enterprise is deemed to have a controlling financial interest if it has i) the power to direct the activities of a variable interest entity that most significantly impact the entity’s economic performance, and ii) the obligation to absorb losses of the VIE that could be significant to the VIE or the rights to receive benefits from the VIE that could be significant to the VIE. Control can also be demonstrated by the ability of a member to manage day-to-day operations, refinance debt and sell the assets of the partnerships without the consent of the other member and the inability of the members to replace the managing member. Based on our examination, there have been no changes to the operating structure of our legal entities during the three months ended March 31, 2023 and, therefore, there are no changes to our evaluation of VIE's as presented within our annual report presented on Form 10-K for the year ended December 31, 2022.
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Noncontrolling Interest | Noncontrolling InterestWe classify the noncontrolling interests of our common units of limited partnership interest in HHLP (“Common Units”), and Long Term Incentive Plan Units (“LTIP Units”) as equity. LTIP Units are a separate class of limited partnership interest in the Operating Partnership that are convertible into Common Units under certain circumstances. |
Investment in Hotel Properties | Investment in Hotel Properties Investments in hotel properties are recorded at cost. Improvements and replacements are capitalized when they extend the useful life of the asset. Costs of repairs and maintenance are expensed as incurred. Depreciation is computed using the straight-line method over the estimated useful life of up to 40 years for buildings and improvements, and to seven years for furniture, fixtures and equipment. We are required to make subjective assessments as to the useful lives of our properties for purposes of determining the amount of depreciation to record on an annual basis with respect to our investments in hotel properties. These assessments have a direct impact on our net income because if we were to shorten the expected useful lives of our investments in hotel properties we would depreciate these investments over fewer years, resulting in more depreciation expense and lower net income on an annual basis. Identifiable assets, liabilities, and noncontrolling interests related to hotel properties acquired are recorded at fair value. Estimating techniques and assumptions used in determining fair values involve significant estimates and judgments. These estimates and judgments have a direct impact on the carrying value of our assets and liabilities which can directly impact the amount of depreciation expense recorded on an annual basis and could have an impact on our assessment of potential impairment of our investment in hotel properties. We consider a hotel to be held for sale when management and our independent trustees commit to a plan to sell the property, the property is available for sale, management engages in an active program to locate a buyer for the property and it is probable the sale will be completed within a year of the initiation of the plan to sell. We evaluate each disposition to determine whether we need to classify the disposition as discontinued operations. We generally include the operations of a hotel that was sold or a hotel that has been classified as held for sale in continuing operations unless the sale represents a strategic shift that will have a major impact on our future operations and financial results. We anticipate that most of our hotel dispositions will not be classified as discontinued operations as most will not fit this definition. NOTE 1 - BASIS OF PRESENTATION (CONTINUED) Based on the occurrence of certain events or changes in circumstances, we review the recoverability of the property’s carrying value. Such events or changes in circumstances include the following: •a significant decrease in the market price of a long-lived asset; •a significant adverse change in the extent or manner in which a long-lived asset is being used or in its physical condition; •a significant adverse change in legal factors or in the business climate that could affect the value of a long-lived asset, including an adverse action or assessment by a regulator; •an accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of a long-lived asset; •a current-period operating or cash flow loss combined with a history of operating or cash flow losses or a projection or forecast that demonstrates continuing losses associated with the use of a long-lived asset; and •a current expectation that, it is more likely than not that, a long-lived asset will be sold or otherwise disposed of significantly before the end of its previously estimated useful life. We review our portfolio on an ongoing basis to evaluate the existence of any of the aforementioned events or changes in circumstances that would require us to test for recoverability. In general, our review of recoverability is based on an estimate of the future undiscounted cash flows, excluding interest charges, expected to result from the property’s use and eventual disposition. These estimates consider factors such as expected future operating income, market and other applicable trends and residual value expected, as well as the effects of hotel demand, competition and other factors. Other assumptions used in the review of recoverability include the holding period and expected terminal capitalization rate. If impairment exists due to the inability to recover the carrying value of a property, an impairment loss is recorded to the extent that the carrying value exceeds the estimated fair value of the property. We are required to make subjective assessments as to whether there are impairments in the values of our investments in hotel properties.
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New Accounting Pronouncements | New Accounting Pronouncements In March 2020, the Financial Accounting Standards Board ("FASB") issued ASU No. 2020-4, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting and in January 2021, the FASB issued 2021-01, Reference Rate Reform (Topic 848), Scope, which further clarified the scope of the reference rate reform optional practical expedients and exceptions outlined in Topic 848. As a result of identified structural risks of interbank offered rates, in particular, the London Interbank Offered Rate (LIBOR), reference rate reform is underway to identify alternative reference rates that are more observable or transaction based. The update provides guidance in accounting for changes in contracts, hedging relationships, and other transactions as a result of this reference rate reform. The optional expedients and exceptions contained within these updates, in general, only apply to contract amendments and modifications entered into prior to January 1, 2023. The provisions of these updates that will most likely affect our financial reporting process related to modifications of contracts with lenders and the related hedging contracts associated with each respective modified borrowing contract. In general, the provisions of these updates would impact the Company by allowing, among other things, the following: •Allowing modifications of debt contracts with lenders that fall under the guidance of ASC Topic 470 to be accounted for as a non-substantial modification and not be considered a debt extinguishment. •Allowing a change to contractual terms of a hedging instrument in conjunction with reference rate reform to not require a dedesignation of the hedging relationship. •Allowing a change to the interest rate used for margining, discounting, or contract price alignment for a derivative that is a cash flow hedge to not be considered a change to the critical terms of the hedge and will not require a dedesignation of the hedging relationship. NOTE 1 - BASIS OF PRESENTATION (CONTINUED) As disclosed in Note 8, Fair Value Measurements and Derivative Instruments, we modified interest rate swap contracts, which serve as cash flow hedges with total notional amounts of $300,000, to replace LIBOR with an alternative reference rate that matches the reference rate of the underlying hedged debt. We did not apply optional expedients and exceptions contained within these updates in the modifications of these contracts. For our remaining borrowing and hedging contracts, we have not entered into modifications as it directly relates to reference rate reform, but we anticipate having to undertake such modifications in the future as we have contracts remaining with lenders and hedging counterparties which are indexed to LIBOR. Some debt contract modifications have occurred and will occur in the normal course of business and will include other changes in the terms, for which this accounting relief is not applicable. However, we anticipate that other debt contract modifications will occur prior to the phase out of LIBOR on June 30, 2023 specifically to address the LIBOR transition, for which we will be able to apply the accounting relief. Revision of Prior Period Financial Statements During the third quarter of 2022, the Company identified immaterial errors in its previously issued financial statements resulting from the incorrect amortization of accumulated other comprehensive income related to interest rate hedges. This occurred over the periods from 2019 through 2021, thereby overstating interest expense in those periods as well as impacting certain captions in the equity section of the consolidated balance sheet, including accumulated other comprehensive income, distributions in excess of net income, and noncontrolling interests. In accordance with Staff Accounting Bulletin (“SAB”) No. 99, “Materiality,” and SAB No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements,” the Company assessed the materiality of these misstatements both quantitatively and qualitatively and determined that these errors and the related impact did not, either individually or in the aggregate, materially misstate previously issued consolidated financial statements. To reflect the correction of these immaterial errors, the Company is revising the previously issued consolidated financial statements for the three months ended March 31, 2022 in this Form 10-Q.
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BASIS OF PRESENTATION (Tables) |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Preferred Stock | Terms of the Series C, Series D, and Series E Preferred Shares outstanding at March 31, 2023 and December 31, 2022 are summarized as follows:
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Schedule of Revision of Prior Period Financial Statements | As a result, the Company has corrected the immaterial misstatements as disclosed in the following tables for all impacted financial statement line items in prior periods.
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INVESTMENT IN HOTEL PROPERTIES (Tables) |
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Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Investment in Hotel Properties | Investment in hotel properties consists of the following at March 31, 2023 and December 31, 2022:
* The net book value of investment in hotel property at Ritz Coconut Grove, which is a variable interest entity, is $36,951 and $37,303 at March 31, 2023 and December 31, 2022, respectively.
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Schedule of Real Estate Assets Sold | During the year ended December 31, 2022, we had the following hotel dispositions:
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INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity Method Investments and Joint Ventures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Investment in Unconsolidated Joint Ventures | As of March 31, 2023 and December 31, 2022, our investment in unconsolidated joint ventures consisted of the following:
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Schedule of Income or Loss from Unconsolidated Joint Ventures | Loss recognized during the three months ended March 31, 2023 and 2022, for our investments in unconsolidated joint ventures is as follows:
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Schedule of Financial Information Related to Unconsolidated Joint Ventures | The following tables set forth the total assets, liabilities, equity and components of net income or loss, including the Company’s share, related to the unconsolidated joint ventures discussed above as of March 31, 2023 and December 31, 2022 and for the three months ended March 31, 2023 and 2022. Balance Sheets
Statements of Operations
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Schedule of Reconciliation of Share in Unconsolidated Joint Ventures Equity in Investment in Unconsolidated Joint Ventures | The following table is a reconciliation of our share in the unconsolidated joint ventures’ equity to our investment in the unconsolidated joint ventures as presented on our balance sheets as of March 31, 2023 and December 31, 2022.
(1) Adjustment to reconcile our share of equity recorded on the joint ventures' financial statements to our investment in unconsolidated joint ventures consists of the difference between our basis in the investment in joint ventures and the equity recorded on the joint ventures' financial statements.
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OTHER ASSETS (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Other Assets | Other Assets consisted of the following at March 31, 2023 and December 31, 2022:
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DEBT (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Mortgages Payable and Interest Expense | Mortgages payable at March 31, 2023 and December 31, 2022 consisted of the following:
Notes payable at March 31, 2023 and December 31, 2022 consisted of the following:
The table below summarizes interest expense incurred by the Company during the three months ended March 31, 2023 and 2022:
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Schedule of Line of Credit Facilities | The following table summarizes the secured term loan balances outstanding as of March 31, 2023 and December 31, 2022:
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Schedule of Borrowing Base Assets | As of March 31, 2023, the following hotel properties secure the Credit Agreement:
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LEASES (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Components of Lease Costs | The components of lease costs for the three months ended March 31, 2023 and 2022 were as follows:
Other information related to leases as of and for the three months ended March 31, 2023 and 2022 is as follows:
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COMMITMENTS AND CONTINGENCIES AND RELATED PARTY TRANSACTIONS (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Operating Expense | For the three months ended March 31, 2023 and 2022, the Company incurred the following fees which are included in Hotel Operating Expenses under Other:
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FAIR VALUE MEASUREMENTS AND DERIVATIVE INSTRUMENTS (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Fair Value of Interest Rate Swaps and Caps | The following table presents our derivative instruments as of March 31, 2023 and December 31, 2022:
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SHARE BASED PAYMENTS (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-Based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Unvested Share Awards Issued to Executives | A summary of our share based compensation activity from December 31, 2022 to March 31, 2023 is as follows:
(1) On March 22, 2023, 1,104,874 Units were issued to the executive officers in settlement of the 2022 Short Term Incentive Program. These Units vest on December 31, 2024, the two year anniversary following the end of the performance period and were determined by dividing the dollar amount of award earned by $9.32, the per share volume weighted average trading price of the Company's common shares on the NYSE for the 20 trading days prior to December 31, 2022.
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Schedule of Employee Service Share-Based Compensation, Allocation of Recognized Period Costs | The following table summarizes share based compensation expense for the three months ended March 31, 2023 and 2022 and unearned compensation as of March 31, 2023 and December 31, 2022:
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Schedule of Disclosure of Share-Based Compensation Arrangements by Share-Based Payment Award | The remaining unvested target units are expected to vest as follows:
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EARNINGS PER SHARE (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Reconciliation of Earnings Per Share | The following table is a reconciliation of the income or loss (numerator) and the weighted average shares (denominator) used in the calculation of basic and diluted earnings per common share. The computation of basic and diluted earnings per share is presented below.
*Loss allocated to noncontrolling interest in HHLP has been excluded from the numerator and Common Units and Vested LTIP Units have been omitted from the denominator for the purpose of computing diluted earnings per share since including these amounts in the numerator and denominator would have no impact. In addition, potentially dilutive common shares, if any, have been excluded from the denominator if they are anti-dilutive to loss applicable to common shareholders.
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BASIS OF PRESENTATION (Schedule Of Preferred Stock) (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
Dec. 31, 2022 |
|
Class of Stock | |||
Shares Outstanding (in shares) | 14,703,214 | 14,703,214 | |
Series C | |||
Class of Stock | |||
Shares Outstanding (in shares) | 3,000,000 | 3,000,000 | |
Aggregate Liquidation Preference | $ 75,000 | ||
Dividend Rate (percent) | 6.875% | ||
Dividend Per Share (in dollars per share) | $ 0.4297 | $ 0.4297 | |
Series D | |||
Class of Stock | |||
Shares Outstanding (in shares) | 7,701,700 | 7,701,700 | |
Aggregate Liquidation Preference | $ 192,500 | ||
Dividend Rate (percent) | 6.50% | ||
Dividend Per Share (in dollars per share) | $ 0.4063 | 0.4063 | |
Series E | |||
Class of Stock | |||
Shares Outstanding (in shares) | 4,001,514 | 4,001,514 | |
Aggregate Liquidation Preference | $ 100,000 | ||
Dividend Rate (percent) | 6.50% | ||
Dividend Per Share (in dollars per share) | $ 0.4063 | $ 0.4063 |
INVESTMENT IN HOTEL PROPERTIES (Investment In Hotel Properties) (Details) - USD ($) $ in Thousands |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Property, Plant and Equipment | ||
Total investment in hotel properties, gross | $ 1,705,626 | $ 1,694,581 |
Less Accumulated Depreciation | (518,919) | (505,342) |
Total Investment in Hotel Properties | 1,186,707 | 1,189,239 |
Variable Interest Entity, Primary Beneficiary | Ritz Coconut Grove | ||
Property, Plant and Equipment | ||
Total Investment in Hotel Properties | 36,951 | 37,303 |
Land | ||
Property, Plant and Equipment | ||
Total investment in hotel properties, gross | 390,532 | 390,532 |
Buildings and Improvements | ||
Property, Plant and Equipment | ||
Total investment in hotel properties, gross | 1,098,258 | 1,093,575 |
Furniture, Fixtures and Equipment | ||
Property, Plant and Equipment | ||
Total investment in hotel properties, gross | 206,189 | 203,369 |
Construction in Progress | ||
Property, Plant and Equipment | ||
Total investment in hotel properties, gross | $ 10,647 | $ 7,105 |
INVESTMENT IN HOTEL PROPERTIES (Narrative) (Details) - property |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Property, Plant and Equipment [Abstract] | ||
Number of real estate properties acquired (property) | 0 | 0 |
INVESTMENT IN HOTEL PROPERTIES (Real Estate Assets Sold) (Details) - Disposed of by Sale $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2022
USD ($)
|
Mar. 31, 2022
property
|
|
Property, Plant and Equipment | ||
Gain on Disposition | $ 197,509 | |
Urban Select Service (7 hotels) | ||
Property, Plant and Equipment | ||
Consideration | 505,000 | |
Gain on Disposition | 170,193 | |
Number of real estate properties (property) | property | 7 | |
Hotel Milo Santa Barbara | ||
Property, Plant and Equipment | ||
Consideration | 55,000 | |
Gain on Disposition | 25,784 | |
Pan Pacific Seattle | ||
Property, Plant and Equipment | ||
Consideration | 70,000 | |
Gain on Disposition | 1,532 | |
Gate hotel JFK Airport | ||
Property, Plant and Equipment | ||
Consideration | 11,000 | |
Gain on Disposition | $ 0 |
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Investment In Unconsolidated Joint Ventures) (Details) - USD ($) $ in Thousands |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Investments in Unconsolidated Joint Ventures | ||
Investment in Unconsolidated Joint Ventures | $ 4,636 | $ 4,989 |
Holiday Inn Express, South Boston, MA | SB Partners, LLC | ||
Investments in Unconsolidated Joint Ventures | ||
Percent owned (percentage) | 50.00% | |
Investment in Unconsolidated Joint Ventures | $ 0 | 0 |
Home2 Suites, South Boston, MA | SB Partners Three, LLC | ||
Investments in Unconsolidated Joint Ventures | ||
Percent owned (percentage) | 50.00% | |
Investment in Unconsolidated Joint Ventures | $ 4,636 | $ 4,989 |
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Narrative) (Details) - USD ($) $ in Thousands |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Investments in Unconsolidated Joint Ventures | ||
Equity method investments | $ 4,636 | $ 4,989 |
Hilton and IHG branded hotels in NYC | Cindat Hersha Owner JV, LLC | ||
Investments in Unconsolidated Joint Ventures | ||
Equity method investments | $ 0 |
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Income Or Loss From Unconsolidated Joint Ventures) (Details) - USD ($) $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
Nov. 29, 2022 |
|
Investments in Unconsolidated Joint Ventures | |||
Loss from Unconsolidated Joint Venture Investments | $ (352) | $ (936) | |
Hiren Boston, LLC | |||
Investments in Unconsolidated Joint Ventures | |||
Loss from Unconsolidated Joint Venture Investments | 0 | (258) | |
Percent owned (percentage) | 50.00% | ||
SB Partners, LLC | |||
Investments in Unconsolidated Joint Ventures | |||
Loss from Unconsolidated Joint Venture Investments | 0 | (310) | |
SB Partners Three, LLC | |||
Investments in Unconsolidated Joint Ventures | |||
Loss from Unconsolidated Joint Venture Investments | $ (352) | $ (368) |
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Schedule of Unconsolidated Joint Ventures Balance Sheet) (Details) - USD ($) $ in Thousands |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Assets | ||
Investment in Hotel Properties, Net | $ 1,186,707 | $ 1,189,239 |
Other Assets | 34,210 | 38,552 |
Total Assets | 1,445,253 | 1,488,877 |
Liabilities and Equity | ||
Mortgages | 208,186 | 208,354 |
Equity: | ||
Hersha Hospitality Trust | 663,954 | 683,000 |
Noncontrolling interests | 74,023 | 73,461 |
Total Liabilities and Equity | 1,445,253 | 1,488,877 |
Equity Method Investment, Nonconsolidated Investee or Group of Investees | ||
Assets | ||
Investment in Hotel Properties, Net | 46,290 | 47,356 |
Other Assets | 11,256 | 11,803 |
Total Assets | 57,546 | 59,159 |
Liabilities and Equity | ||
Mortgages | 50,060 | 50,236 |
Other Liabilities | 10,081 | 10,012 |
Equity: | ||
Hersha Hospitality Trust | 1,877 | 2,630 |
Noncontrolling interests | (4,472) | (3,719) |
Total Equity | (2,595) | (1,089) |
Total Liabilities and Equity | $ 57,546 | $ 59,159 |
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES (Reconciliation Of Share In Unconsolidated Joint Ventures' Equity In Investment In Unconsolidated Joint Ventures) (Details) - USD ($) $ in Thousands |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Equity Method Investments and Joint Ventures [Abstract] | ||
Our share of equity recorded on the joint ventures' financial statements | $ 1,877 | $ 2,630 |
Adjustment to reconcile our share of equity recorded on the joint ventures' financial statements to our investment in unconsolidated joint ventures | 2,759 | 2,359 |
Investment in Unconsolidated Joint Ventures | $ 4,636 | $ 4,989 |
OTHER ASSETS (Other Assets) (Details) - USD ($) $ in Thousands |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Derivative Asset | $ 14,730 | $ 18,709 |
Deferred Financing Costs | 1,008 | 1,197 |
Prepaid Expenses | 9,437 | 10,481 |
Investment in Statutory Trusts | 1,548 | 1,548 |
Investment in Non-Hotel Property and Inventories | 1,936 | 2,026 |
Deposits with Unaffiliated Third Parties | 574 | 597 |
Deferred Tax Asset, Net of Valuation Allowance of $15,586 and $14,414, respectively | 0 | 0 |
Swap Interest Receivable | 1,104 | 932 |
Other | 3,873 | 3,062 |
Total other assets | 34,210 | 38,552 |
Deferred tax assets, net of valuation allowance | $ 15,586 | $ 14,414 |
OTHER ASSETS (Narrative) (Details) - USD ($) $ in Thousands |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Deferred tax assets, net | $ 0 | $ 0 |
DEBT (Mortgages) (Details) - USD ($) $ in Thousands |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Mortgages and Notes Payable | ||
Net Unamortized Deferred Financing Costs | $ (1,867) | $ (2,217) |
Mortgages | ||
Mortgages and Notes Payable | ||
Mortgage Indebtedness | 208,570 | 208,880 |
Net Unamortized Premium | 5 | 7 |
Net Unamortized Deferred Financing Costs | (389) | (533) |
Mortgages Payable | 208,186 | 208,354 |
Junior Subordinated Debt | Hersha Statutory Trust I and Hersha Statutory Trust II | ||
Mortgages and Notes Payable | ||
Mortgage Indebtedness | 51,548 | 51,548 |
Net Unamortized Deferred Financing Costs | (640) | (653) |
Mortgages Payable | $ 50,908 | $ 50,842 |
DEBT (Mortgage Narratives) (Details) - Mortgages |
Mar. 31, 2023 |
---|---|
Maximum | |
Debt Instrument | |
Debt instrument interest rate (percent) | 9.00% |
Minimum | |
Debt Instrument | |
Debt instrument interest rate (percent) | 4.02% |
DEBT (Summary of Balances Outstanding) (Details) - USD ($) |
Mar. 31, 2023 |
Dec. 31, 2022 |
Aug. 04, 2022 |
---|---|---|---|
Short-term Debt | |||
Deferred Loan Costs | $ (1,867,000) | $ (2,217,000) | |
Total Secured Term Loan | 370,986,000 | 370,636,000 | |
$250 Million Term Loan (First Term Loan) | |||
Short-term Debt | |||
Debt instrument, face amount | $ 372,853,000 | $ 372,853,000 | $ 400,000,000 |
DEBT (Statutory Trust I and Statutory Trust II Notes Payable) (Details) - Junior Subordinated Debt $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023
USD ($)
loan
|
Mar. 31, 2022 |
|
Hersha Statutory Trust I and Hersha Statutory Trust II | ||
Debt Instrument | ||
Number of instruments held | loan | 2 | |
Subordinated debt | $ 51,548 | |
Number of business days prior to quarterly interest payments for resetting rates | 2 days | |
Debt instrument, interest rate during period (in hundredths) | 7.67% | 3.17% |
Hersha Statutory Trust I | ||
Debt Instrument | ||
Subordinated debt | $ 25,774 | |
Debt instrument, basis spread on variable rate (percent) | 3.00% | |
Hersha Statutory Trust II | ||
Debt Instrument | ||
Subordinated debt | $ 25,774 | |
Debt instrument, basis spread on variable rate (percent) | 3.00% |
DEBT (Schedule of Interest Expense) (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Debt Instrument | ||
Deferred Financing Costs Amortization | $ 697 | $ 1,191 |
Other | 104 | 75 |
Total Interest Expense | 9,089 | 13,870 |
Line of credit | ||
Debt Instrument | ||
Interest expense | 6,628 | 3,649 |
Interest Rate Swap | Line of credit | ||
Debt Instrument | ||
Interest expense | (2,463) | 1,455 |
Mortgages | ||
Debt Instrument | ||
Interest expense | 3,797 | 2,529 |
Mortgages | Hersha Statutory Trust I and Hersha Statutory Trust II | ||
Debt Instrument | ||
Interest expense | 1,002 | 4,406 |
Mortgages | Interest Rate Swap | ||
Debt Instrument | ||
Interest expense | $ (676) | $ 565 |
LEASES (Narrative) (Details) - Building |
Mar. 31, 2023
property
lease
|
---|---|
Lessee, Lease, Description | |
Number of real estate properties (property) | property | 2 |
Number of lease agreements (leases) | lease | 2 |
LEASES (Lease Costs) (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Lessee, Lease, Description | ||
Operating lease costs | $ 424 | $ 1,138 |
Variable lease costs | 96 | 110 |
Total lease costs | 520 | 1,248 |
Ground Lease | ||
Lessee, Lease, Description | ||
Operating lease costs | 303 | 1,050 |
Variable lease costs | 15 | 40 |
Total lease costs | 318 | 1,090 |
Office Lease | ||
Lessee, Lease, Description | ||
Operating lease costs | 121 | 88 |
Variable lease costs | 81 | 70 |
Total lease costs | $ 202 | $ 158 |
LEASES (Other Information) (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Leases [Abstract] | ||
Cash paid from operating cash flow for operating leases | $ 538 | $ 1,085 |
Weighted average remaining lease term (in years) | 50 years 8 months 12 days | 63 years 4 months 24 days |
Weighted average discount rate (in percent) | 7.84% | 7.86% |
FAIR VALUE MEASUREMENTS AND DERIVATIVE INSTRUMENTS (Narrative) (Details) - USD ($) $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
Dec. 31, 2022 |
|
Derivatives, Fair Value | |||
Gain (loss) on fair value of derivative instruments | $ (3,972) | $ 15,122 | |
Unrealized gain (loss) reclassified from accumulated other comprehensive income to interest expense | 7 | $ (367) | |
Loss to be reclassified to interest expense during next 12 months | 11,490 | ||
Carrying (Reported) Amount, Fair Value Disclosure | |||
Derivatives, Fair Value | |||
Carrying value and estimated fair value of debt | 630,080 | $ 629,885 | |
Estimate of Fair Value, Fair Value Disclosure | |||
Derivatives, Fair Value | |||
Carrying value and estimated fair value of debt | $ 610,845 | $ 610,401 |
SHARE BASED PAYMENTS (Narrative) (Details) |
3 Months Ended | ||
---|---|---|---|
Mar. 22, 2022
$ / shares
shares
|
Mar. 31, 2023
shares
|
Mar. 22, 2023
d
|
|
LTIP Unit Awards | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Granted (in shares) | 1,104,874 | 1,104,874 | |
Performance period | 2 years | ||
Trading days | d | 20 | ||
Volume weighted average share price ( in dollars per share) | $ / shares | $ 9.32 | ||
Compensation cost not yet recognized, period for recognition (in years) | 1 year | ||
Restricted Share Awards | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Granted (in shares) | 52,710 | ||
Compensation cost not yet recognized, period for recognition (in years) | 10 months 24 days |
SHARE BASED PAYMENTS (Summary of share based compensation expense and unearned compensation) (Details) - USD ($) $ in Thousands |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
Dec. 31, 2022 |
|
Share-based Compensation Arrangement by Share-based Payment Award | |||
Share Based Compensation Expense | $ 2,052 | $ 2,541 | |
Unearned Compensation | 11,351 | $ 8,535 | |
LTIP Unit Awards | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Share Based Compensation Expense | 773 | 1,777 | |
Unearned Compensation | 8,359 | 5,311 | |
Restricted Share Awards | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Share Based Compensation Expense | 199 | 192 | |
Unearned Compensation | 721 | 683 | |
Share Awards | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Share Based Compensation Expense | 810 | 287 | |
Unearned Compensation | 0 | 0 | |
Market Based | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Share Based Compensation Expense | 270 | $ 285 | |
Unearned Compensation | $ 2,271 | $ 2,541 |
EARNINGS PER SHARE (Details) - USD ($) $ in Thousands |
3 Months Ended | |||
---|---|---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|||
Basic and Diluted | ||||
Net loss | $ (9,501) | $ (16,599) | ||
Loss allocated to Noncontrolling Interests | 606 | 408 | ||
Distributions to Preferred Shareholders | (6,044) | (6,044) | ||
Dividends Paid on Unvested Restricted Shares and LTIP Units | (116) | 0 | ||
Net loss applicable to Common Shareholders | $ (15,055) | $ (22,235) | ||
DENOMINATOR: | ||||
Weighted average number of common shares - basic (in shares) | 39,626,231 | 39,231,550 | ||
Effect of dilutive securities: | ||||
Restricted stock awards and LTIP units (unvested) (in shares) | 0 | 0 | ||
Contingently issued shares and units (in shares) | 0 | 0 | ||
Weighted average number of common shares - diluted (in shares) | [1] | 39,626,231 | 39,231,550 | |
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