Equity and Equity-Based Compensation

9 Months Ended

Sep. 30, 2014

Equity [Abstract]

Equity and Equity-Based Compensation

Equity and Equity-Based Compensation

Equity Offering—On April 8, 2014, we commenced a follow-on public offering of 7.5 million shares of common stock at $10.70 per share for gross proceeds of $80.3 million. The aggregate proceeds net of underwriting discount and other expenses were approximately $76.8 million. The offering settled on April 14, 2014. We granted the underwriters a 30-day option to purchase up to an additional 1.125 million shares of common stock. On May 9, 2014, the underwriters partially exercised their option and purchased an additional 850,000 shares of our common stock at a price of $10.70 per share less the underwriting discount resulting in additional net proceeds of approximately $8.7 million.

Common Stock Dividends—For each of the 2014 and 2013 quarters, the Board of Directors declared quarterly dividends of $0.12 per outstanding share of common stock with an annualized target of $0.48 per share for 2014.

Equity-Based Compensation—We recognized compensation expense related to restricted shares of our common stock of $766,000 and $2.4 million for the three and nine months ended September 30, 2014, respectively, and $530,000 and $1.7 million for the three and nine months ended September 30, 2013, respectively. As of September 30, 2014, the unamortized cost of the unvested shares of restricted stock was $4.9 million, which is being amortized over periods from 0.5 to 2.4 years.

Preferred Dividends—During the three months ended September 30, 2014, the Board of Directors declared quarterly dividends of $0.5344 per share for our 8.55% Series A preferred stock, $0.5281 per share for our 8.45% Series D preferred stock, and $0.5625 per share for our 9.00% Series E preferred stock. During the three months ended September 30, 2013, the Board of Directors declared quarterly dividends of $0.5344 per share for our 8.55% Series A preferred stock, $0.5281 per share for our 8.45% Series D preferred stock and $0.5625 per share for our 9.00% Series E preferred stock.

Noncontrolling Interests in Consolidated Entities—Our noncontrolling entity partner, had an ownership interest of 15% in two hotel properties and a total carrying value of $801,000 and $1.0 million at September 30, 2014 and December 31, 2013, respectively. Our ownership interest is reported in equity in the consolidated balance sheets. Through November 19, 2013, we held a 75% ownership interest in two hotel properties in which our partner held a 25% ownership interest. These two hotel properties were contributed to Ashford Prime in connection with the Ashford Prime spin-off. Noncontrolling interests in consolidated entities were allocated losses of $124,000 and $146,000 for the three and nine months ended September 30, 2014, respectively, and loss of $175,000 and $890,000 for the three and nine months ended September 30, 2013, respectively.

On September 10, 2014, the Company entered into four Assignment, Assumption and Admission Agreements to effect the collective sale of 40% equity interests in two consolidated entities to Messrs. Monty Bennett and Rob Hays for an aggregate amount of $1.2 million. As of September 30, 2014, this amount was included in “Due from related parties”. All amounts were collected subsequent to September 30, 2014.The carrying amount of the 40% ownership interest is $560,000 at September 30, 2014.