Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2012

Summary of Significant Accounting Policies

Schedule of estimated effects of a Third-Party manager's fiscal calendar on calendar year total revenue and net income

The Company estimates that Marriott’s fiscal calendar had the following effects on the Company’s total revenue and net income based on the average daily revenues and income generated by its Marriott hotels during the years ended December 31, 2012, 2011 and 2010 as follows (in thousands):

	2012 (1)			2011 (1)			2010 (1)
Total revenue	$	(1,251	)	$	(1,048	)	$	(495	)
Net income	$	(328	)	$	(273	)	$	(126	)

(1) Reductions in total revenue and net income based on the Marriott fiscal calendars for 2012 (363 days), 2011 (364 days) and 2010 (364 days) versus a standard 365 day year.

Schedule of amortization and write-off of deferred financing fees

Total amortization and write-off of deferred financing fees for 2012, 2011 and 2010 was as follows (in thousands):

	2012		2011		2010
Continuing operations:
Amortization of deferred financing fees	$	3,690	$	3,138	$	1,457
Write-off of deferred financing fees	3		21		1,462
Total deferred financing fees — continuing operations	3,693		3,159		2,919
Discontinued operations:
Amortization of deferred financing fees	74		104		581
Write-off of deferred financing fees	185		42		123
Total deferred financing fees — discontinued operations	259		146		704
Total amortization and write-off of deferred financing fees	$	3,952	$	3,305	$	3,623

Schedule of goodwill

As of December 31, 2012 and 2011, goodwill consisted of the following (in thousands):

	2012		2011
Balance at beginning of year (1)	$	9,405	$	990
Purchase of outside 50.0% equity interest in BuyEfficient	—		8,415
Balance at end of year (1)	$	9,405	$	9,405

(1) Assets held for sale, net includes goodwill of $3.7 million as of both December 31, 2012 and 2011 related to hotels that the Company sold in January 2013.

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

The following table presents the Company’s assets measured at fair value on a recurring and non-recurring basis at December 31, 2012 and 2011 (in thousands):

			Fair Value Measurements at Reporting Date
	Total		Level 1		Level 2		Level 3
December 31, 2012:
Interest rate cap derivative agreements	$	48	$	—	$	48	$	—
Life insurance policy	1,494		—		1,494		—
Total assets at December 31, 2012	$	1,542	$	—	$	1,542	$	—
December 31, 2011:
Interest rate cap derivative agreements	$	386	$	—	$	386	$	—
Life insurance policy	1,877		—		1,877		—
Total assets at December 31, 2011	$	2,263	$	—	$	2,263	$	—

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

The following table presents the Company’s liabilities measured at fair value on a recurring and non-recurring basis at December 31, 2012 and 2011 (in thousands):

			Fair Value Measurements at Reporting Date
	Total		Level 1		Level 2		Level 3
December 31, 2012:
Interest rate swap derivative agreement	$	1,636	$	—	$	1,636	$	—
Retirement benefit agreement	1,494		—		1,494		—
Total liabilities at December 31, 2012	$	3,130	$	—	$	3,130	$	—
December 31, 2011:
Interest rate swap derivative agreement	$	1,567	$	—	$	1,567	$	—
Retirement benefit agreement	1,687		—		1,687		—
Total liabilities at December 31, 2011	$	3,254	$	—	$	3,254	$	—

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

The following table presents the gains and impairment charges included in earnings as a result of applying Level 3 measurements for the years ended December 31, 2012, 2011 and 2010 (in thousands):

	2012		2011			2010
Gains:
Investment in unconsolidated joint ventures (1)	$	—	$	69,230		$	—
Impairment charges:
Other assets, net (2)	—		(10,862		)	—
Assets held for sale, net (3)	—		(1,495		)	(1,943		)
Total impairment charges	—		(12,357		)	(1,943		)
Total Level 3 measurement charges included in earnings	$	—	$	56,873		$	(1,943	)

(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 the impairment loss recorded by the Company on the Royal Palm note due to the note’s sale in October 2011.

(3) Includes the $1.5 million impairment loss recorded on a commercial laundry facility in Salt Lake City, Utah which the Company sold in July 2011, and the $1.9 million impairment loss on an office building and land adjacent to one of the Company’s hotels, which the Company sold in September 2012.

Schedule of computation of basic and diluted earnings per common share

The following table sets forth the computation of basic and diluted earnings per common share (in thousands, except per share data):

	Year Ended December 31, 2012			Year Ended December 31, 2011			Year Ended December 31, 2010
Numerator:
Net income	$	49,557		$	81,299		$	38,542
Income from consolidated joint venture attributable to non-controlling interest	(1,761		)	(312		)	—
Distributions to non-controlling interest	(31		)	(30		)	—
Preferred stock dividends and accretion	(29,748		)	(27,321		)	(20,652		)
Undistributed income allocated to unvested restricted stock compensation	(203		)	(636		)	(102		)
Numerator for basic and diluted earnings available to common stockholders	$	17,814		$	53,000		$	17,788
Denominator:
Weighted average basic and diluted common shares outstanding	127,027			117,206			99,709
Basic and diluted earnings available to common stockholders per common share	$	0.14		$	0.45		$	0.18