Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2011

Summary of Significant Accounting Policies

Schedule of intangible assets included in investment in hotel properties

	2011			2010
Contractual advance hotel bookings (1)	$	26,110		$	—
Easement agreements (2)	12,421			12,421
Ground/air lease agreements (3)	121,850			21,660
In-place lease agreements (4)	4,580			—
	164,961			34,081
Accumulated amortization	(15,719		)	(1,425		)
	$	149,242		$	32,656

Schedule of amortization expense on intangible assets included in investment in hotel properties

	2011		2010		2009
Contractual advance hotel bookings (1)	$	9,988	$	—	$	—
Easement agreements (2)	29		26		37
Ground/air lease agreements (3)	3,978		255		255
In-place lease agreements (4)	299		—		—
	$	14,294	$	281	$	292

(1)Contractual advance hotel bookings consist of advance deposits related to the purchases of the Doubletree Guest Suites Times Square, the JW Marriott New Orleans & the 75.0% majority interest in the entity that owns the Hilton San Diego Bayfront. The contractual advance hotel bookings are recorded at a discounted present value based on estimated collectability, and are amortized using the straight-line method based over the periods the amounts are expected to be collected through April 2013.

(2)Easement agreements at the Marriott Del Mar and the Hilton Times Square are valued at fair value at the date of acquisition. The Marriott Del Mar easement agreement is amortized using the straight-line method over the remaining non-cancelable term of the related agreement, which is 87 years as of December 31, 2011. The Hilton Times Square easement agreement has an indefinite useful life, and, therefore, is not amortized. This non-amortizable intangible asset is reviewed annually for impairment and more frequently if events or circumstances indicate that the asset may be impaired. If a non-amortizable intangible asset is subsequently determined to have a finite useful life, the intangible asset will be written down to the lower of its fair value or carrying amount and then amortized prospectively, based on the remaining useful life of the intangible asset.

(3)Ground/air lease agreements at the Hilton Times Square, the Doubletree Guest Suites Times Square and the JW Marriott New Orleans are valued at fair value at the date of acquisition. The agreements are amortized using the straight-line method over the remaining non-cancelable terms of the related agreements, which range from between 25 and 79 years as of December 31, 2011.

(4)In-place lease agreements at the Doubletree Guest Suites Times Square and the Hilton San Diego Bayfront are valued at fair value at the date of acquisition. The agreements are amortized using the straight-line method over the remaining non-cancelable terms of the related agreements, which range from between seven and 16 years as of December 31, 2011.

Schedule of amortization and write-off of deferred financing fees

	2011		2010		2009
Continuing operations:
Amortization of deferred financing fees	$	3,232	$	1,585	$	1,811
Write-off of deferred financing fees (1)	21		1,585		284
Total deferred financing fees — continuing operations	3,253		3,170		2,095
Discontinued operations:
Amortization of deferred financing fees	10		453		578
Write-off of deferred financing fees (1)	42		—		—
Total deferred financing fees — discontinued operations	52		453		578
Total amortization and write-off of deferred financing fees	$	3,305	$	3,623	$	2,673

(1)Write-off of deferred financing fees during 2011 includes $21,000 written off to continuing operations related to the refinancing of debt secured by the Doubletree Guest Suites Times Square, and $42,000 written off to discontinued operations related to the buyer’s assumption of debt in connection with the sale of the Valley River Inn. Write-off of deferred financing fees during 2010 includes $1.5 million written off due to the termination of the Company’s credit facility, and $0.1 million written off related to the release of three hotels from the Mass Mutual loan. Write-off of deferred financing fees during 2009 includes $0.3 million written off in association with the amendment of the Company’s credit facility.

Schedule of goodwill

	2011		2010
Balance at beginning of year	$	4,673	$	4,673
Purchase of outside 50.0% equity interest in BuyEfficient	8,415		—
Balance at end of year	$	13,088	$	4,673

Schedule of assets and liabilities measured at fair value on a recurring and non-recurring basis

	Total December 31,		Fair Value Measurements at Reporting Date
	2011		Level 1		Level 2		Level 3
Assets:
Interest rate cap derivative agreements	$	386	$	—	$	386	$	—
Life insurance policy	1,877		—		1,877		—
Total assets	$	2,263	$	—	$	2,263	$	—
Liabilities:
Retirement benefit agreement	$	1,687	$	—	$	1,687	$	—
Interest rate swap derivative agreement	1,567		—		1,567		—
Total liabilities	$	3,254	$	—	$	3,254	$	—

The following table presents our assets and liabilities measured at fair value on a recurring and non-recurring basis at December 31, 2010 (in thousands):

	Total December 31,		Fair Value Measurements at Reporting Date
	2010		Level 1		Level 2		Level 3
Assets:
Other real estate, net (1)	$	2,506	$	—	$	—	$	2,506
Life insurance policy	1,868		—		1,868		—
Total assets	$	4,374	$	—	$	1,868	$	2,506
Liabilities:
Retirement benefit agreement	$	1,868	$	—	$	1,868	$	—
Total liabilities	$	1,868	$	—	$	1,868	$	—

(1)Includes the office building and land adjacent to one of the Company’s hotels that was impaired and recorded at fair value in June 2010.

Schedule of activity recorded for assets measured at fair value on a non-recurring basis using Level 3 inputs

	Goodwill
Balance at December 31, 2010	$	4,673
Purchase of outside 50.0% equity interest in BuyEfficient	8,415
Balance at December 31, 2011	$	13,088

Schedule of gains and impairment charges included in earnings as a result of applying Level 3 measurements

	2011			2010			2009
Gains:
Investment in unconsolidated joint ventures (1)	$	69,230		$	—		$	—
Impairment charges:
Investment in hotel properties, net	—			—			(25,488		)
Investment in hotel properties of discontinued operations, net	—			—			(192,286		)
Goodwill	—			—			(3,948		)
Other real estate, net	—			(1,943		)	—
Other real estate of discontinued operations, net	(1,495		)	—			—
Other assets, net	(10,862		)	—			(1,416		)
Investment in unconsolidated joint ventures	—			—			(26,007		)
Other current assets of discontinued operations, net (2)	—			—			(3,007		)
Total impairment charges	(12,357		)	(1,943		)	(252,152		)
Total Level 3 measurement charges included in earnings	$	56,873		$	(1,943	)	$	(252,152	)

(1)Includes the gains recorded by the Company on the remeasurements of the Company’s equity interests in its Doubletree Guest Suites Times Square and BuyEfficient joint ventures.

(2)Includes goodwill impairment losses recorded on discontinued operations.

Schedule of computation of basic and diluted earnings (loss) per common share

	Year Ended December 31, 2011			Year Ended December 31, 2010			Year Ended December 31, 2009
Numerator:
Net income (loss)	$	81,299		$	38,542		$	(269,608	)
Income from consolidated joint venture attributable to non-controlling interest	(312		)	—			—
Distributions to non-controlling interest	(30		)	—			—
Dividends paid on unvested restricted stock compensation	—			—			(447		)
Preferred stock dividends and accretion	(27,321		)	(20,652		)	(20,749		)
Undistributed income allocated to unvested restricted stock compensation	(636		)	(102		)	—
Numerator for basic and diluted earnings available (loss attributable) to common stockholders	$	53,000		$	17,788		$	(290,804	)
Denominator:
Weighted average basic and diluted common shares outstanding	117,206			99,709			69,820
Basic and diluted earnings available (loss attributable) to common stockholders per common share	$	0.45		$	0.18		$	(4.17	)