Summary of Significant Accounting Policies (Tables)

6 Months Ended

Jun. 30, 2019

Summary of Significant Accounting Policies

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 (unaudited and in thousands, except per share data):

	Three Months Ended June 30,				Six Months Ended June 30,
	2019		2018		2019		2018
Numerator:
Net income	$	45,918	$	51,262	$	63,834	$	89,717
Income from consolidated joint venture attributable to noncontrolling interest		(1,955)		(2,374)		(3,554)		(4,813)
Preferred stock dividends		(3,207)		(3,207)		(6,414)		(6,414)
Distributions paid on unvested restricted stock compensation		(61)		(59)		(122)		(118)
Undistributed income allocated to unvested restricted stock compensation		(156)		(179)		(167)		(298)
Numerator for basic and diluted income attributable to common stockholders	$	40,539	$	45,443	$	53,577	$	78,074
Denominator:
Weighted average basic and diluted common shares outstanding		227,389		225,232		227,305		224,760
Basic and diluted income attributable to common stockholders per common share	$	0.18	$	0.20	$	0.24	$	0.35

Schedule of contract assets and liabilities

Trade receivables and contract liabilities consisted of the following (in thousands):

	June 30,		December 31,
	2019		2018
	(unaudited)
Trade receivables, net (1)	$	25,250	$	18,982
Contract liabilities (2)	$	17,052	$	16,711

(1) Trade receivables are included in accounts receivable, net on the accompanying consolidated balance sheets.

(2) Contract liabilities consist of advance deposits, and are included in both other current liabilities and other liabilities on the accompanying consolidated balance sheets. Of the amount outstanding at December 31, 2018, approximately $2.4 million and $15.3 million were recognized in revenue during the three and six months ended June 30, 2019, respectively.

Schedule of financial statement adjustments due to adoption of ASU 2016-02

The adjustments related to operating leases affected the Company’s January 1, 2019 consolidated balance sheet as follows (in thousands):

	Balance Pre-Adoption		Adjustments		Balance Post-Adoption
			(unaudited)		(unaudited)
Operating lease right-of-use assets, net	$	—	$	64,075	$	64,075
Investment in hotel properties, net (intangible assets)	$	50,889		(18,398)	$	32,491
Total asset adjustments			$	45,677
Operating lease obligations, current and noncurrent	$	—	$	58,663	$	58,663
Other liabilities (deferred rent)	$	12,986		(12,986)	$	—
Total liability adjustments			$	45,677

Upon adoption of the new standard, the Company reclassified amounts related to its finance leases as follows (in thousands):

	Balance Pre-Adoption		Adjustments		Balance Post-Adoption
			(unaudited)		(unaudited)
Finance lease right-of-use assets, net	$	—	$	55,727	$	55,727
Investment in hotel properties, net (land)	$	611,993		(6,605)	$	605,388
Investment in hotel properties, net (buildings and improvements, net of accumulated depreciation)	$	2,167,680		(49,122)	$	2,118,558
Total asset adjustments			$	—
Finance lease obligations, current and noncurrent	$	—	$	27,010	$	27,010
Capital lease obligations, current and noncurrent	$	27,010		(27,010)	$	—
Total liability adjustments			$	—