0001558370-22-009665.txt : 20220602 0001558370-22-009665.hdr.sgml : 20220602 20220602161524 ACCESSION NUMBER: 0001558370-22-009665 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 17 CONFORMED PERIOD OF REPORT: 20220527 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Regulation FD Disclosure ITEM INFORMATION: Other Events ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20220602 DATE AS OF CHANGE: 20220602 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Sunstone Hotel Investors, Inc. CENTRAL INDEX KEY: 0001295810 STANDARD INDUSTRIAL CLASSIFICATION: HOTELS & MOTELS [7011] IRS NUMBER: 201296886 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-32319 FILM NUMBER: 22990975 BUSINESS ADDRESS: STREET 1: 200 SPECTRUM CENTER DRIVE STREET 2: 21ST FLOOR CITY: IRVINE STATE: CA ZIP: 92618 BUSINESS PHONE: (949) 330-4000 MAIL ADDRESS: STREET 1: 200 SPECTRUM CENTER DRIVE STREET 2: 21ST FLOOR CITY: IRVINE STATE: CA ZIP: 92618 8-K 1 sho-20220527x8k.htm 8-K
0001295810false0001295810us-gaap:SeriesHPreferredStockMember2022-05-272022-05-270001295810us-gaap:CommonStockMember2022-05-272022-05-270001295810sho:SeriesIPreferredStockMember2022-05-272022-05-2700012958102022-05-272022-05-27

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): May 27, 2022

Sunstone Hotel Investors, Inc.

(Exact Name of Registrant as Specified in Its Charter)

    

    

    

 

Maryland

 

001-32319

 

20-1296886

(State or Other Jurisdiction of
Incorporation or Organization)

 

(Commission File Number)

 

(I.R.S. Employer
Identification Number)

200 Spectrum Center Drive21st Floor
IrvineCalifornia

 

92618

(Address of Principal Executive Offices)

 

(Zip Code)

(949) 330-4000

(Registrant’s telephone number including area code)

N/A

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class

Trading Symbol(s)

Name of Each Exchange on Which Registered

Common Stock, $0.01 par value

SHO

New York Stock Exchange

Series H Cumulative Redeemable Preferred Stock, $0.01 par value

SHO.PRH

New York Stock Exchange

Series I Cumulative Redeemable Preferred Stock, $0.01 par value

SHO.PRI

New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company

If an emerging growth company, indicate by checkmark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 

Item 2.02Results of Operations and Financial Condition.

On June 2, 2022, Sunstone Hotel Investors, Inc. (the “Company”) issued a press release providing a preliminary update on its second quarter 2022 operations. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

The information furnished pursuant to Item 2.02 of this Current Report on Form 8-K, including Exhibit 99.1 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities under that Section, and shall not be deemed to be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Exchange Act, regardless of any general incorporation language in such filing.

Item 7.01Regulation FD Disclosure.

On June 1, 2022, the Company issued a press release announcing its entry into a definitive agreement with an affiliate of Park Hotels & Resorts, Inc. (“Park”) to acquire Park’s 25% interest in the joint venture that owns the leasehold interest in the 1,190-room Hilton San Diego Bayfront. A copy of the press release is attached as Exhibit 99.2 to this Current Report on Form 8-K and is incorporated herein by reference.

The information furnished pursuant to Item 7.01 of this Current Report on Form 8-K, including Exhibit 99.2, shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities under that Section, and shall not be deemed to be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Exchange Act, regardless of any general incorporation language in such filing.

Item 8.01.Other Events.

On May 27, 2022, the Company entered into a definitive agreement with Park to acquire Park’s 25% interest in the joint venture that owns the leasehold interest in the 1,190-room Hilton San Diego Bayfront (the “Hotel”). As part of the transaction, the Company will pay Park $102 million in cash and will effectively assume Park’s $55 million share of the existing mortgage loan on the Hotel. The Company currently anticipates closing the transaction by the end of the second quarter 2022 and expects to fund the acquisition primarily from borrowing on the Company’s revolving credit facility. The acquisition is subject to the satisfaction of customary closing conditions, and the Company can give no assurance that the transaction will close.

Item 9.01.Financial Statements and Exhibits.

(d) The following exhibits are furnished herewith:

EXHIBIT INDEX

Exhibit No.

     

Description

99.1

Press Release, dated June 2, 2022 (furnished pursuant to Item 2.02).

99.2

Press Release, dated June 1, 2022 (furnished pursuant to Item 7.01).

104

Cover Page Interactive Data File (embedded within the Inline XBRL document).

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

  

Sunstone Hotel Investors, Inc.

Date: June 2, 2022

By:

/s/ Aaron R. Reyes

Aaron R. Reyes
(Principal Financial Officer and Duly Authorized Officer)

EX-99.1 2 sho-20220527xex99d1.htm EX-99.1

Exhibit 99.1

2007 Logo Med

SUNSTONE HOTEL INVESTORS COMPLETES ACQUISITION OF THE CONFIDANTE MIAMI BEACH AND PROVIDES BUSINESS UPDATE

Irvine, Calif. (June 2, 2022) – Sunstone Hotel Investors, Inc. (the "Company" or "Sunstone") (NYSE: SHO), the owner of Long-Term Relevant Real Estate® in the lodging industry, today announced that it has completed the previously announced acquisition of the 339-room The Confidante Miami Beach (the “Hotel”) for a purchase price of $232 million, or $684,000 per key. The Company will invest approximately $60 million to reposition the Hotel into a premiere beachfront resort under Hyatt's luxury, lifestyle Andaz brand. Upon completion of the renovation, Sunstone will own a well-located, fully renovated, beachfront resort at a highly attractive all-in basis. The Company expects the Hotel will generate an 8% to 9% stabilized net operating income yield on the total investment in the Hotel, including the planned repositioning. The renovation program will begin in phases, starting in the fourth quarter of 2022 with completion expected to occur in the first half of 2024 when the Hotel will debut as Andaz Miami Beach.

The Company expects the Hotel will generate $3.5 to $4.0 million of EBITDA during its ownership period in 2022. The acquisition was funded from available cash and with $140 million of proceeds received from the Company’s previously undrawn revolving credit facility. Together with the expected funding for the previously announced acquisition of the remaining 25% joint venture interest in the Hilton San Diego Bayfront which is expected to close by the end of June, the Company anticipates having an outstanding credit facility balance at the end of the second quarter of approximately $240 million. Based on the Company’s anticipated leverage ratio as of the end of the second quarter, borrowings on the credit facility are expected to bear interest at the rate of one-month LIBOR plus 1.50%.

Operations Update

The Company’s operations for April and May 2022 reflect accelerating hotel demand as compared to the first quarter of 2022. While leisure travel continues to be robust, the greatest demand growth is occurring at the Company’s urban and group-oriented hotels which are experiencing an increase in near-term booking activity, higher than expected attendance at group events, and increased business transient volume.

Occupancy at the comparable 12 hotels the Company owned during both 2022 and 2019 (the “12 Hotel Comparable Portfolio”) has improved from down more than 2,800 bps as compared to 2019 in the first quarter of 2022 to down only 1,240 bps in Q2 2022 QTD.
Average Daily Rate at the 12 Hotel Comparable Portfolio has exceeded 2019 levels in each month of 2022 and is higher by 11.3% so far in Q2 2022 QTD.
As of April 30, 2022, group revenue pace for the 12 Hotel Comparable Portfolio for Q2 through Q4 2022 was down only 15% as compared to the same time in 2019, with average rates approximately 5% higher than in 2019.
As of mid-May, the 12 Hotel Comparable Portfolio had 87% of the total transient room nights on-the-books for June to December as compared to the same time in 2019, with average rates approximately 31% higher than in 2019.
In the second quarter 2019, the 12 Hotel Comparable Portfolio generated RevPAR of $229.50. Based on stronger demand acceleration in April and May, the Company currently anticipates that RevPAR at the 12 Hotel Comparable Portfolio for the second quarter 2022 will be down only 6% to 8% as compared to the second quarter of 2019.

Operating statistics for the 12 Hotel Comparable Portfolio as of May 31, 2022 were as follows:

Occupancy

ADR

RevPAR

2022

Change vs. 2019

2022

Change vs. 2019

2022

Change vs. 2019

April

75.7

%

(1,290)

bps

$

296.52

13.1

%

$

224.47

(3.3)

%

May (1)

73.4

%

(1,180)

bps

$

286.73

9.4

%

$

210.46

(5.8)

%

Q2 2022 QTD (1)

74.5

%

(1,240)

bps

$

291.62

11.3

%

$

217.26

(4.6)

%

2022 YTD (1)

61.8

%

(2,170)

bps

$

285.64

10.7

%

$

176.53

(18.0)

%


Operating statistics for all 14 hotels owned by the Company as of May 31, 2022 were as follows:

April 2022

May 2022 (1)

Q2 2022 QTD (1)

2022 YTD (1)

Occupancy

75.3

%

73.1

%

74.2

%

61.5

%

ADR

$

319.81

$

314.41

$

317.11

$

309.07

RevPAR

$

240.82

$

229.83

$

235.30

$

190.08

(1)Results for May 2022 are preliminary and may be adjusted during the month end closing process. Preliminary Q2 2022 QTD and 2022 YTD reflect preliminary results through May 31, 2022.

Share Repurchase Update

Since the beginning of April through June 1, 2022, the Company has repurchased 1.9 million shares of its common stock at an average price of $11.01 per share for a total purchase price of $21.2 million. Year to date, the Company has repurchased 5.8 million shares of its common stock at an average price of $11.13 per share for a total purchase price of $64.6 million. The Company has $435.4 million remaining under its existing share repurchase authorization. The authorization has no stated expiration date and future repurchases will depend on various factors, including the Company's capital availability and the price of the Company's common stock. The Company will provide the details of future stock repurchase activity, if any, as part of its quarterly financial reporting.  

About Sunstone Hotel Investors

Sunstone Hotel Investors, Inc. is a lodging real estate investment trust (“REIT”). Sunstone’s strategy is to create long-term stakeholder value through the acquisition, active ownership, and disposition of hotels considered to be Long-Term Relevant Real Estate®. For further information, please visit Sunstone’s website at www.sunstonehotels.com.

For Additional Information

Aaron Reyes

Chief Financial Officer

Sunstone Hotel Investors, Inc.

(949) 382-3018

Forward Looking Statements

This press release contains forward-looking statements within the meaning of federal securities laws and regulations. These forward-looking statements are identified by their use of terms and phrases such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “should,” “will” and other similar terms and phrases, including opinions, references to assumptions and forecasts of future results. Forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors that may cause the actual results to differ materially from those anticipated at the time the forward-looking statements are made. These risks include, but are not limited to: the impact the COVID-19 pandemic has on the Company’s business and the economy, as well as the response of governments and the Company to the pandemic, and how quickly and successfully effective vaccines and therapies are distributed and administered; increased risks related to employee matters, including increased employment litigation and claims for severance or other benefits tied to termination or furloughs as a result of temporary hotel suspensions or reduced hotel operations due to COVID-19; general economic and business conditions, including a U.S. recession or increased inflation, trade conflicts and tariffs, regional or global economic slowdowns and any type of flu or disease-related pandemic that impacts travel or the ability to travel, including COVID-19; the need for business-related travel, including the increased use of business-related technology; rising hotel operating costs due to labor costs, workers’ compensation and health-care related costs, utility costs, property and liability insurance costs, unanticipated costs such as acts of nature and their consequences and other costs that may not be offset by increased room rates; the ground or airspace leases for two of the hotels the Company has interests in as of the date of this release; the need for renovations, repositionings and other capital expenditures for the Company’s hotels; the impact, including any delays, of renovations and repositionings on hotel operations; new hotel supply, or alternative lodging options such as timeshare, vacation rentals or sharing services such as Airbnb, in the Company’s markets, which could harm its occupancy levels and revenue at its hotels; competition from hotels not owned by the Company; relationships with, and the requirements, performance and reputation of, the managers of the Company’s hotels; relationships with, and the requirements and reputation of, the Company’s franchisors and hotel brands; the Company’s hotels may become impaired, or its hotels which have previously become impaired may become further impaired in the future, which may adversely affect its financial condition and results of operations; competition for the acquisition of hotels, and the Company’s ability to complete acquisitions and dispositions; performance of hotels after they are acquired; changes in the Company’s business strategy or acquisition or disposition plans; the Company’s level of debt, including secured, unsecured, fixed and variable rate debt; financial and other covenants in the Company’s debt and preferred stock; the impact on the Company’s business of potential defaults by the Company on its debt agreements or leases; volatility in the capital markets and the effect on lodging demand or the Company’s ability to obtain capital on favorable terms or at all; the Company’s need to operate as a REIT and comply with other applicable laws and regulations, including


new laws, interpretations or court decisions that may change the federal or state tax laws or the federal or state income tax consequences of the Company’s qualification as a REIT; potential adverse tax consequences in the event that the Company’s operating leases with its taxable REIT subsidiaries are not held to have been made on an arm’s-length basis; system security risks, data protection breaches, cyber-attacks and systems integration issues, including those impacting the Company’s suppliers, hotel managers or franchisors; other events beyond the Company’s control, including climate change, natural disasters, terrorist attacks or civil unrest; and other risks and uncertainties associated with the Company’s business described in its filings with the Securities and Exchange Commission. Although the Company believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that the expectations will be attained or that any deviation will not be material. All forward-looking information provided herein is as of the date of this release, and the Company undertakes no obligation to update any forward-looking statement to conform the statement to actual results or changes in the Company’s expectations.

This release should be read together with the consolidated financial statements and notes thereto included in our most recent reports on Form 10-K and Form 10-Q. Copies of these reports are available on our website at www.sunstonehotels.com and through the SEC’s Electronic Data Gathering Analysis and Retrieval System (“EDGAR”) at www.sec.gov.


EX-99.2 3 sho-20220527xex99d2.htm EX-99.2

Exhibit 99.2

2007 Logo Med

SUNSTONE HOTEL INVESTORS TO ACQUIRE THE REMAINING 25% JOINT VENTURE INTEREST IN HILTON SAN DIEGO BAYFRONT FROM PARK HOTELS & RESORTS

Irvine, Calif. (June 1, 2022) – Sunstone Hotel Investors, Inc. (the “Company” or “Sunstone”) (NYSE: SHO), the owner of Long-Term Relevant Real Estate® in the lodging industry, announced that it has entered into a definitive agreement with an affiliate of Park Hotels & Resorts Inc. (“Park”) to acquire Park’s 25% interest in the joint venture that owns the leasehold interest in the 1,190-room Hilton San Diego Bayfront (the "Hotel"). As part of the transaction, Sunstone will pay Park $102 million in cash and will effectively assume Park’s $55 million share of the existing mortgage loan on the Hotel, which is already fully consolidated as part of Sunstone’s financial statements. Following the acquisition, Sunstone will own 100% of the venture’s interests in the Hotel.

The purchase price, including the in-place debt, implies a $628 million value for the Hotel, or $527,700 per key, and represents a 13.2x multiple on the Hotel’s 2022 forecasted EBITDA and a 6.6% capitalization rate on 2022 forecasted net operating income. The Company currently anticipates closing the transaction by the end of the second quarter 2022 and expects to fund the acquisition primarily from borrowing on the Company’s revolving credit facility.

Bryan Giglia, Chief Executive Officer, stated, “We are pleased to announce our acquisition of the remaining 25% joint venture interest in the Hilton San Diego Bayfront. This is a very well-located, high-quality asset in a premier convention and leisure market. The hotel is in excellent physical condition, and with the recent addition of new meeting space, a refreshed lobby, and enhanced food & beverage offerings, the hotel is well positioned to benefit from strong leisure travel and recovering business transient and corporate group demand. We thank our partners at Park for their collaboration over the years and believe this transaction, which consolidates ownership for Sunstone and provides Park with a fair valuation for their ownership interest, is a mutually beneficial outcome for both parties.”

The acquisition is subject to the satisfaction of customary closing conditions, and the Company can give no assurance that the transaction will close. The forecast amounts referenced in this release are based on the Company's assumptions of operating performance and the Company cannot assure you that the forecasts will be achieved.

About Sunstone Hotel Investors

Sunstone Hotel Investors, Inc. is a lodging real estate investment trust (“REIT”). Sunstone’s strategy is to create long-term stakeholder value through the acquisition, active ownership, and disposition of hotels considered to be Long-Term Relevant Real Estate®. For further information, please visit Sunstone’s website at www.sunstonehotels.com.

For Additional Information

Aaron Reyes

Chief Financial Officer

Sunstone Hotel Investors, Inc.

(949) 382-3018


Forward-Looking Statements

This press release contains forward-looking statements within the meaning of federal securities laws and regulations. These forward-looking statements are identified by their use of terms and phrases such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “should,” “will” and other similar terms and phrases, including opinions, references to assumptions and forecasts of future results. Forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors that may cause the actual results to differ materially from those anticipated at the time the forward-looking statements are made. These risks include, but are not limited to: the impact the COVID-19 pandemic has on the Company’s business and the economy, as well as the response of governments and the Company to the pandemic, and how quickly and successfully effective vaccines and therapies are distributed and administered; increased risks related to employee matters, including increased employment litigation and claims for severance or other benefits tied to termination or furloughs as a result of temporary hotel suspensions or reduced hotel operations due to COVID-19; general economic and business conditions, including a U.S. recession or increased inflation, trade conflicts and tariffs, regional or global economic slowdowns and any type of flu or disease-related pandemic that impacts travel or the ability to travel, including COVID-19; the need for business-related travel, including the increased use of business-related technology; rising hotel operating costs due to labor costs, workers’ compensation and health-care related costs, utility costs, property and liability insurance costs, unanticipated costs such as acts of nature and their consequences and other costs that may not be offset by increased room rates; the ground or airspace leases for two of the hotels the Company has interests in as of the date of this release; the need for renovations, repositionings and other capital expenditures for the Company’s hotels; the impact, including any delays, of renovations and repositionings on hotel operations; new hotel supply, or alternative lodging options such as timeshare, vacation rentals or sharing services such as Airbnb, in the Company’s markets, which could harm its occupancy levels and revenue at its hotels; competition from hotels not owned by the Company; relationships with, and the requirements, performance and reputation of, the managers of the Company’s hotels; relationships with, and the requirements and reputation of, the Company’s franchisors and hotel brands; the Company’s hotels may become impaired, or its hotels which have previously become impaired may become further impaired in the future, which may adversely affect its financial condition and results of operations; competition for the acquisition of hotels, and the Company’s ability to complete acquisitions and dispositions; performance of hotels after they are acquired; changes in the Company’s business strategy or acquisition or disposition plans; the Company’s level of debt, including secured, unsecured, fixed and variable rate debt; financial and other covenants in the Company’s debt and preferred stock; the impact on the Company’s business of potential defaults by the Company on its debt agreements or leases; volatility in the capital markets and the effect on lodging demand or the Company’s ability to obtain capital on favorable terms or at all; the Company’s need to operate as a REIT and comply with other applicable laws and regulations, including new laws, interpretations or court decisions that may change the federal or state tax laws or the federal or state income tax consequences of the Company’s qualification as a REIT; potential adverse tax consequences in the event that the Company’s operating leases with its taxable REIT subsidiaries are not held to have been made on an arm’s-length basis; system security risks, data protection breaches, cyber-attacks and systems integration issues, including those impacting the Company’s suppliers, hotel managers or franchisors; other events beyond the Company’s control, including climate change, natural disasters, terrorist attacks or civil unrest; and other risks and uncertainties associated with the Company’s business described in its filings with the Securities and Exchange Commission. Although the Company believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that the expectations will be attained or that any deviation will not be material. All forward-looking information provided herein is as of the date of this release, and the Company undertakes no obligation to update any forward-looking statement to conform the statement to actual results or changes in the Company’s expectations.

This release should be read together with the consolidated financial statements and notes thereto included in our most recent reports on Form 10-K and Form 10-Q. Copies of these reports are available on our website at www.sunstonehotels.com and through the SEC’s Electronic Data Gathering Analysis and Retrieval System (“EDGAR”) at www.sec.gov.

Non-GAAP Financial Measure

We present the following non-GAAP financial measure that we believe is useful to investors as a key supplemental measure of our operating performance: hotel adjusted earnings before interest expense, taxes, depreciation and amortization for real estate, or Hotel Adjusted EBITDAre. This measure should not be considered in isolation or as a


substitute for measures of performance in accordance with GAAP. In addition, our calculation of this measure may not be comparable to other companies that do not define the term exactly the same as the Company. This non-GAAP measure is used in addition to and in conjunction with results presented in accordance with GAAP. It should not be considered as an alternative to net income (loss), cash flow from operations, or any other operating performance measure prescribed by GAAP. This non-GAAP financial measure reflects additional ways of viewing our operations that we believe, when viewed with our GAAP results and the reconciliations to the corresponding GAAP financial measure, provides a more complete understanding of factors and trends affecting our business than could be obtained absent this disclosure. We strongly encourage investors to review our financial information in its entirety and not to rely on a single financial measure.

We present EBITDAre in accordance with guidelines established by the National Association of Real Estate Investment Trusts (“NAREIT”), as defined in its September 2017 white paper “Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate.” We believe EBITDAre is a useful performance measure to help investors evaluate and compare the results of our operations from period to period in comparison to our peers. NAREIT defines EBITDAre as net income (calculated in accordance with GAAP) plus interest expense, income tax expense, depreciation and amortization, gains or losses on the disposition of depreciated property (including gains or losses on change in control), impairment write-downs of depreciated property and of investments in unconsolidated affiliates caused by a decrease in the value of depreciated property in the affiliate, and adjustments to reflect the entity’s share of EBITDAre of unconsolidated affiliates.

We make additional adjustments to EBITDAre to exclude the amortization of our right-of-use assets and related lease obligations as these expenses are based on historical cost accounting and do not reflect the actual rent amounts due to the respective lessors or the underlying performance of our hotels.

Hotel Adjusted EBITDAre Reconciliation

Hilton San Diego Bayfront

(dollars in thousands)

Plus:

Equals:

Less:

Equals:

Depreciation &

Hotel

Hotel Net

Total Revenues

Net Income

Other Adjustments

Adjusted EBITDAre

FF&E Reserve

Operating Income

Full Year 2022 Forecast

$

150,798

$

35,464

$

12,175

$

47,639

$

(6,032)

$

41,607

EBITDA Multiple/Cap Rate (1)

13.2

x

6.6

%

(1)EBITDAre Multiple calculated as gross sale price divided by Hotel Adjusted EBITDAre. Cap Rate calculated as Hotel Net Operating Income divided by gross sale price.

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Document and Entity Information
May 27, 2022
Document Type 8-K
Amendment Flag false
Document Period End Date May 27, 2022
Entity Registrant Name Sunstone Hotel Investors, Inc.
Entity Central Index Key 0001295810
Entity Incorporation, State or Country Code MD
Entity File Number 001-32319
Entity Tax Identification Number 20-1296886
Entity Address, Address Line One 200 Spectrum Center Drive
Entity Address, Adress Line Two 21st Floor
Entity Address, City or Town Irvine
Entity Address, State or Province CA
Entity Address, Postal Zip Code 92618
City Area Code 949
Local Phone Number 330-4000
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Entity Emerging Growth Company false
Common Stock  
Title of 12(b) Security Common Stock, $0.01 par value
Trading Symbol SHO
Security Exchange Name NYSE
Series H Cumulative Redeemable Preferred Stock  
Title of 12(b) Security Series H Cumulative Redeemable Preferred Stock, $0.01 par value
Trading Symbol SHO.PRH
Security Exchange Name NYSE
Series I Cumulative Redeemable Preferred Stock  
Title of 12(b) Security Series I Cumulative Redeemable Preferred Stock, $0.01 par value
Trading Symbol SHO.PRI
Security Exchange Name NYSE
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