10-Q 1 soho-10q_20160930.htm FORM 10-Q soho-10q_20160930.htm

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 10-Q

 

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

For the quarterly period ended September 30, 2016

 

SOTHERLY HOTELS INC.

(Exact name of registrant as specified in its charter)

 

 

MARYLAND

001-32379

20-1531029

(State or Other Jurisdiction of

Incorporation or Organization)

(Commission

File Number)

(I.R.S. Employer

Identification No.)

 

SOTHERLY HOTELS LP

(Exact name of registrant as specified in its charter)

 

 

DELAWARE

001-36091

20-1965427

(State or Other Jurisdiction of

Incorporation or Organization)

(Commission

File Number)

(I.R.S. Employer

Identification No.)

 

410 West Francis Street

Williamsburg, Virginia 23185

(757) 229-5648

(Address and Telephone Number of Principal Executive Offices)

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Sotherly Hotels Inc.    Yes      No       Sotherly Hotels LP    Yes      No  

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files.)

Sotherly Hotels Inc.    Yes      No       Sotherly Hotels LP    Yes      No  

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer”, “accelerated filer”, and “smaller reporting company” in Rule 12b-2 of the Securities Exchange Act. (Check one):

Sotherly Hotels Inc.

 

Large Accelerated Filer

 

 

Accelerated Filer

 

 

 

 

 

 

Non-accelerated Filer

 

 

Smaller Reporting Company

 

Sotherly Hotels LP

 

Large Accelerated Filer

 

 

Accelerated Filer

 

 

 

 

 

 

Non-accelerated Filer

 

 

Smaller Reporting Company

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    

Sotherly Hotels Inc.    Yes      No   Sotherly Hotels LP    Yes      No  

As of November 8, 2016, there were 14,949,651 shares of Sotherly Hotels Inc.’s common stock issued and outstanding and 1,610,000 shares of Sotherly Hotels Inc.’s 8% Series B Cumulative Redeemable Perpetual Preferred stock.  

 

 


 

EXPLANATORY NOTE

We refer to Sotherly Hotels Inc. as the “Company,” Sotherly Hotels LP as the “Operating Partnership,” and the Company’s common stock as “Common Stock.”  References to “we” and “our” mean the Company, its Operating Partnership and its subsidiaries and predecessors, collectively, unless the context otherwise requires or where otherwise indicated.

The Company conducts virtually all of its activities through the Operating Partnership and is its sole general partner. The partnership agreement provides that the Operating Partnership will assume and pay when due, or reimburse the Company for payment of, all costs and expenses relating to the ownership and operations of, or for the benefit of, the Operating Partnership. The partnership agreement further provides that all expenses of the Company are deemed to be incurred for the benefit of the Operating Partnership.

This report combines the Quarterly Reports on Form 10-Q for the period ended September 30, 2016 of the Company and the Operating Partnership. We believe combining the quarterly reports into this single report results in the following benefits:

 

combined reports better reflect how management and investors view the business as a single operating unit;

 

combined reports enhance investors' understanding of the Company and the Operating Partnership by enabling them to view the business as a whole and in the same manner as management;

 

combined reports are more efficient for the Company and the Operating Partnership and result in savings in time, effort and expense; and

 

combined reports are more efficient for investors by reducing duplicative disclosure and providing a single document for their review.

To help investors understand the significant differences between the Company and the Operating Partnership, this report presents the following separate sections for each of the Company and the Operating Partnership:

 

Consolidated Financial Statements;

 

the following Notes to Consolidated Financial Statements:

 

Note 6 – Equity; and

 

Note 12 – Income Per Share and Per Unit;

 

Item 4 - Controls and Procedures; and

 

Item 6 - Certifications of CEO and CFO Pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act.

 

 

2


 

SOTHERLY HOTELS INC.

SOTHERLY HOTELS LP

INDEX

 

 

 

 

 

Page

 

 

 

 

 

PART I

Item 1.

 

Consolidated Financial Statements

 

4

 

 

Sotherly Hotels Inc.

 

4

 

 

Consolidated Balance Sheets as of September 30, 2016 (unaudited) and December 31, 2015

 

4

 

 

Consolidated Statements of Operations (unaudited) for the Three and Nine Months Ended September 30, 2016 and 2015

 

5

 

 

Consolidated Statement of Changes in Equity (unaudited) for the Nine Months Ended September 30, 2016

 

6

 

 

Consolidated Statements of Cash Flows (unaudited) for the Nine Months Ended September 30, 2016 and 2015

 

7

 

 

Sotherly Hotels LP

 

8

 

 

Consolidated Balance Sheets as of September 30, 2016 (unaudited) and December 31, 2015

 

8

 

 

Consolidated Statements of Operations (unaudited) for the Three and Nine Months Ended September 30, 2016 and 2015

 

9

 

 

Consolidated Statement of Changes in Partners’ Capital (unaudited) for the Nine Months Ended September 30, 2016

 

10

 

 

Consolidated Statements of Cash Flows (unaudited) for the Nine Months Ended September 30, 2016 and 2015

 

11

 

 

Notes to Consolidated Financial Statements

 

12

Item 2.

 

Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

28

Item 3.

 

Quantitative and Qualitative Disclosures About Market Risk

 

43

Item 4

 

Controls and Procedures

 

44

 

 

 

 

 

PART II

Item 1.

 

Legal Proceedings

 

46

Item 1A.

 

Risk Factors

 

46

Item 2.

 

Unregistered Sales of Equity Securities and Use of Proceeds

 

46

Item 3.

 

Defaults Upon Senior Securities

 

46

Item 4.

 

Mine Safety Disclosures

 

46

Item 5.

 

Other Information

 

46

Item 6.

 

Exhibits

 

47

 

3


 

PART I

Item 1.

Consolidated Financial Statements

SOTHERLY HOTELS INC.

CONSOLIDATED BALANCE SHEETS

 

 

 

September 30, 2016

 

 

December 31, 2015

 

 

 

(unaudited)

 

 

 

 

 

ASSETS

 

 

 

 

 

 

 

 

Investment in hotel properties, net

 

$

354,137,772

 

 

$

354,963,242

 

Cash and cash equivalents

 

 

26,432,532

 

 

 

11,493,914

 

Restricted cash

 

 

5,866,231

 

 

 

5,793,840

 

Accounts receivable, net

 

 

4,552,916

 

 

 

4,071,175

 

Accounts receivable-affiliate

 

 

190,733

 

 

 

226,552

 

Loan proceeds receivable

 

 

 

 

 

2,600,711

 

Prepaid expenses, inventory and other assets

 

 

4,923,258

 

 

 

4,432,431

 

Deferred income taxes

 

 

5,846,563

 

 

 

5,390,374

 

TOTAL ASSETS

 

$

401,950,005

 

 

$

388,972,239

 

LIABILITIES

 

 

 

 

 

 

 

 

Mortgage loans, net

 

$

270,836,333

 

 

$

270,331,724

 

Unsecured notes, net

 

 

24,224,706

 

 

 

50,460,106

 

Accounts payable and accrued expenses

 

 

15,563,701

 

 

 

12,334,878

 

Advance deposits

 

 

2,439,097

 

 

 

1,651,840

 

Dividends and distributions payable

 

 

1,929,029

 

 

 

1,335,323

 

TOTAL LIABILITIES

 

$

314,992,866

 

 

$

336,113,871

 

Commitments and contingencies (See Note 5)

 

 

 

 

 

 

EQUITY

 

 

 

 

 

 

 

 

Sotherly Hotels Inc. stockholders’ equity

 

 

 

 

 

 

 

 

8% Series B Cumulative Redeemable Perpetual Preferred stock, par value $0.01,

   11,000,000 shares authorized, liquidation preference $25 per share, 1,610,000

   shares and 0 shares issued and outstanding at September 30, 2016 and

   December 31, 2015, respectively

 

 

16,100

 

 

 

 

Common stock, par value $0.01, 49,000,000 shares authorized, 14,949,651

   shares and 14,490,714 shares issued and outstanding at September 30, 2016 and

   December 31, 2015, respectively

 

 

149,496

 

 

 

144,907

 

Additional paid in capital

 

 

121,559,775

 

 

 

82,749,058

 

Distributions in excess of retained earnings

 

 

(37,399,276

)

 

 

(33,890,834

)

Total Sotherly Hotels Inc. stockholders’ equity

 

 

84,326,095

 

 

 

49,003,131

 

Noncontrolling interest

 

 

2,631,044

 

 

 

3,855,237

 

TOTAL EQUITY

 

 

86,957,139

 

 

 

52,858,368

 

TOTAL LIABILITIES AND EQUITY

 

$

401,950,005

 

 

$

388,972,239

 

 

The accompanying notes are an integral part of these consolidated financial statements.

 

4


 

SOTHERLY HOTELS INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)

 

 

Three Months Ended

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

Nine Months Ended

 

 

September 30, 2016

 

 

September 30, 2015

 

 

September 30, 2016

 

 

September 30, 2015

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

REVENUE

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rooms department

$

26,665,132

 

 

$

24,132,181

 

 

$

83,896,833

 

 

$

71,819,966

 

Food and beverage department

 

8,412,842

 

 

 

7,556,969

 

 

 

26,240,932

 

 

 

23,889,092

 

Other operating departments

 

2,197,338

 

 

 

2,252,725

 

 

 

6,772,647

 

 

 

6,073,555

 

Total revenue

 

37,275,312

 

 

 

33,941,875

 

 

 

116,910,412

 

 

 

101,782,613

 

EXPENSES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hotel operating expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rooms department

 

7,236,932

 

 

 

6,657,947

 

 

 

21,916,775

 

 

 

18,998,964

 

Food and beverage department

 

5,820,000

 

 

 

5,562,404

 

 

 

18,250,542

 

 

 

16,668,025

 

Other operating departments

 

642,219

 

 

 

491,751

 

 

 

1,880,618

 

 

 

1,192,917

 

Indirect

 

14,492,775

 

 

 

13,245,062

 

 

 

43,241,433

 

 

 

37,046,275

 

Total hotel operating expenses

 

28,191,926

 

 

 

25,957,164

 

 

 

85,289,368

 

 

 

73,906,181

 

Depreciation and amortization

 

3,790,872

 

 

 

3,374,209

 

 

 

11,260,987

 

 

 

9,583,506

 

Loss on disposal of assets

 

189,267

 

 

 

207,235

 

 

 

329,461

 

 

 

201,835

 

Corporate general and administrative

 

1,367,848

 

 

 

2,437,428

 

 

 

4,331,896

 

 

 

5,379,032

 

Total operating expenses

 

33,539,913

 

 

 

31,976,036

 

 

 

101,211,712

 

 

 

89,070,554

 

NET OPERATING INCOME

 

3,735,399

 

 

 

1,965,839

 

 

 

15,698,700

 

 

 

12,712,059

 

Other income (expense)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

(4,626,333

)

 

 

(4,245,679

)

 

 

(13,872,129

)

 

 

(11,860,649

)

Interest income

 

44,485

 

 

 

15,480

 

 

 

63,523

 

 

 

40,888

 

Equity income in joint venture

 

 

 

 

8,173

 

 

 

 

 

 

506,890

 

Loss on early debt extinguishment

 

(1,087,395

)

 

 

(74,824

)

 

 

(1,157,688

)

 

 

(772,907

)

Unrealized loss on hedging activities

 

(492

)

 

 

(106,808

)

 

 

(66,567

)

 

 

(106,808

)

Gain on change in control

 

 

 

 

6,560,958

 

 

 

 

 

 

6,560,958

 

Gain on involuntary conversion of asset

 

 

 

 

 

 

 

 

 

 

32,433

 

Net income/(loss) before income taxes

 

(1,934,336

)

 

 

4,123,139

 

 

 

665,839

 

 

 

7,112,864

 

Income tax (provision)/benefit

 

385,145

 

 

 

513,505

 

 

 

308,398

 

 

 

(3,255

)

Net income/(loss)

 

(1,549,191

)

 

 

4,636,644

 

 

 

974,237

 

 

 

7,109,609

 

Less: Net (income)/loss attributable to the noncontrolling interest

 

172,846

 

 

 

(764,250

)

 

 

(106,377

)

 

 

(1,230,773

)

Net income/(loss) attributable to the Company

 

(1,376,345

)

 

 

3,872,394

 

 

 

867,860

 

 

 

5,878,836

 

Distributions to preferred shareholders

 

(339,889

)

 

 

 

 

 

(339,889

)

 

 

 

Net income/(loss) attributable to common shareholders

$

(1,716,234

)

 

$

3,872,394

 

 

$

527,971

 

 

$

5,878,836

 

Net income/(loss) per share attributable to the common shareholders

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted

$

(0.11

)

 

$

0.27

 

 

$

0.04

 

 

$

0.49

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average number of common shares outstanding

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted

 

14,949,651

 

 

 

14,247,671

 

 

 

14,897,595

 

 

 

11,884,110

 

 

The accompanying notes are an integral part of these consolidated financial statements.

 

5


 

SOTHERLY HOTELS INC.

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Additional

 

 

Distributions

 

 

 

 

 

 

 

 

 

 

Preferred Stock

 

Common Stock

 

 

Paid-

 

 

in Excess of

 

 

Noncontrolling

 

 

 

 

 

 

Shares

 

 

Par Value

 

Shares

 

 

Par Value

 

 

In Capital

 

 

Retained Earnings

 

 

Interest

 

 

Total

 

Balances at December 31, 2015

 

 

 

$

 

 

14,490,714

 

 

$

144,907

 

 

$

82,749,058

 

 

$

(33,890,834

)

 

$

3,855,237

 

 

$

52,858,368

 

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

867,860

 

 

 

106,377

 

 

 

974,237

 

Issuance of Series B

   Preferred Stock

 

1,610,000

 

 

 

16,100

 

 

 

 

 

 

 

 

37,758,129

 

 

 

 

 

 

 

 

 

37,774,229

 

Issuance of unrestricted

   common stock awards

 

 

 

 

 

 

24,250

 

 

 

242

 

 

 

128,040

 

 

 

 

 

 

 

 

 

128,282

 

Issuance of restricted

   common stock awards

 

 

 

 

 

 

12,000

 

 

 

120

 

 

 

63,360

 

 

 

 

 

 

 

 

 

63,480

 

Conversion of Operating

   Partnership units into

   shares of common stock

 

 

 

 

 

 

422,687

 

 

 

4,227

 

 

 

846,248

 

 

 

 

 

 

(850,475

)

 

 

 

Amortization of restricted

   stock award

 

 

 

 

 

 

 

 

 

 

 

 

14,940

 

 

 

 

 

 

 

 

 

14,940

 

Preferred stock dividends declared

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(339,889

)

 

 

 

 

 

(339,889

)

Common shareholders'

   dividends and

   distributions declared

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(4,036,413

)

 

 

(480,095

)

 

 

(4,516,508

)

Balances at September 30,

   2016 (unaudited)

 

1,610,000

 

 

$

16,100

 

 

14,949,651

 

 

$

149,496

 

 

$

121,559,775

 

 

$

(37,399,276

)

 

$

2,631,044

 

 

$

86,957,139

 

 

The accompanying notes are an integral part of these consolidated financial statements.

 

6


 

SOTHERLY HOTELS INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)

 

 

Nine Months Ended

 

 

Nine Months Ended

 

 

September 30, 2016

 

 

September 30, 2015

 

Cash flows from operating activities:

 

 

 

 

 

 

 

Net income

$

974,237

 

 

$

7,109,609

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

 

 

 

Depreciation and amortization

 

11,260,987

 

 

 

9,583,506

 

Gain on change in control

 

 

 

 

(6,560,958

)

Equity income in joint venture

 

 

 

 

(506,890

)

Amortization of deferred financing costs

 

939,122

 

 

 

991,858

 

Amortization of mortgage premium

 

(18,511

)

 

 

(12,341

)

Gain on involuntary conversion

 

 

 

 

(32,433

)

Unrealized loss on derivative instrument

 

66,567

 

 

 

106,808

 

Loss on disposal of assets

 

329,461

 

 

 

201,835

 

Loss on early debt extinguishment

 

1,157,688

 

 

 

772,907

 

Charges related to equity-based compensation

 

206,702

 

 

 

280,996

 

Changes in assets and liabilities:

 

 

 

 

 

 

 

Restricted cash

 

(2,409,252

)

 

 

(816,271

)

Accounts receivable

 

(481,741

)

 

 

(2,699,986

)

Prepaid expenses, inventory and other assets

 

(617,601

)

 

 

(955,695

)

Deferred income taxes

 

(456,188

)

 

 

(483,877

)

Accounts payable and other accrued liabilities

 

3,535,914

 

 

 

1,443,460

 

Advance deposits

 

787,257

 

 

 

1,001,999

 

Accounts receivable - affiliate

 

35,819

 

 

 

(89,654

)

Net cash provided by operating activities

 

15,310,461

 

 

 

9,334,873

 

Cash flows from investing activities:

 

 

 

 

 

 

 

Acquisitions of hotel properties

 

 

 

 

(25,525,754

)

Improvements and additions to hotel properties

 

(11,223,268

)

 

 

(15,694,033

)

Distributions from joint venture

 

 

 

 

600,000

 

Funding of restricted cash reserves

 

(3,970,657

)

 

 

(3,539,948

)

Proceeds from involuntary conversion of assets

 

 

 

 

124,609

 

Proceeds from the sale of assets

 

211,400

 

 

 

 

Proceeds of restricted cash reserves

 

6,307,518

 

 

 

5,797,378

 

Proceeds from sale of asset

 

 

 

 

2,027,113

 

Net cash used in investing activities

 

(8,675,007

)

 

 

(36,210,635

)

Cash flows from financing activities:

 

 

 

 

 

 

 

Proceeds of mortgage debt

 

45,700,000

 

 

 

125,000,000

 

Proceeds from mortgage loan receivable

 

2,600,711

 

 

 

 

Proceeds from sale of common stock

 

 

 

 

23,250,818

 

Proceeds from sale of preferred stock

 

37,774,229

 

 

 

 

Payments on mortgage loans

 

(44,453,440

)

 

 

(118,444,300

)

Redemption of unsecured notes

 

(27,600,000

)

 

 

 

Payment of deferred financing costs

 

(1,455,645

)

 

 

(1,326,663

)

Dividends and distributions paid

 

(4,262,691

)

 

 

(2,768,207

)

Net cash provided by financing activities

 

8,303,164

 

 

 

25,711,648

 

Net increase (decrease) in cash and cash equivalents

 

14,938,618

 

 

 

(1,164,114

)

Cash and cash equivalents at the beginning of the period

 

11,493,914

 

 

 

16,634,499

 

Cash and cash equivalents at the end of the period

$

26,432,532

 

 

$

15,470,385

 

Supplemental disclosures:

 

 

 

 

 

 

 

Cash paid during the period for interest

$

12,948,885

 

 

$

10,702,488

 

Cash paid during the period for income taxes

$

29,925

 

 

$

570,762

 

Non-cash investing and financing activities:

 

 

 

 

 

 

 

Change from assumed loan on Crowne Plaza Hollywood Beach Resort acquisition

$

 

 

$

57,000,000

 

Change in loan premium on the Crowne Plaza Hollywood Beach Resort assumed loan

$

 

 

$

246,815

 

Change in amount of hotel property improvements in accounts payable and accrued liabilities

$

307,098

 

 

$

657,990

 

 

The accompanying notes are an integral part of these consolidated financial statements.

7


 

SOTHERLY HOTELS LP

CONSOLIDATED BALANCE SHEETS

 

 

September 30, 2016

 

 

December 31, 2015

 

 

(unaudited)

 

 

 

 

 

ASSETS

 

 

 

 

 

 

 

Investment in hotel properties, net

$

354,137,772

 

 

$

354,963,242

 

Cash and cash equivalents

 

26,432,532

 

 

 

11,493,914

 

Restricted cash

 

5,866,231

 

 

 

5,793,840

 

Accounts receivable, net

 

4,552,916

 

 

 

4,071,175

 

Accounts receivable-affiliate

 

190,733

 

 

 

226,552

 

Loan proceeds receivable

 

 

 

 

2,600,711

 

Prepaid expenses, inventory and other assets

 

4,923,258

 

 

 

4,432,431

 

Deferred income taxes

 

5,846,563

 

 

 

5,390,374

 

TOTAL ASSETS

$

401,950,005

 

 

$

388,972,239

 

LIABILITIES

 

 

 

 

 

 

 

Mortgage loans, net

$

270,836,333

 

 

$

270,331,724

 

Unsecured notes, net

 

24,224,706

 

 

 

50,460,106

 

Accounts payable and other accrued liabilities

 

15,563,701

 

 

 

12,334,878

 

Advance deposits

 

2,439,097

 

 

 

1,651,840

 

Dividends and distributions payable

 

1,929,029

 

 

 

1,335,323

 

TOTAL LIABILITIES

$

314,992,866

 

 

$

336,113,871

 

 

 

 

 

 

 

 

 

Commitments and contingencies (see Note 5)

 

 

 

 

 

 

 

 

 

 

 

 

 

PARTNERS’ CAPITAL

 

 

 

 

 

 

 

8% Series B Cumulative Redeemable Perpetual Preferred units, liquidation preference

   $25 per unit, 1,610,000 units and 0 units issued and outstanding at September 30,

   2016 and December 31, 2015, respectively

 

37,434,340

 

 

 

 

General Partner: 167,278 units and 166,915 units issued and outstanding as of

   September 30, 2016 and December 31, 2015, respectively

 

740,938

 

 

 

774,295

 

Limited Partners: 16,560,513 units and 16,524,626 units issued and outstanding as

   of September 30, 2016 and December 31, 2015, respectively

 

48,781,861

 

 

 

52,084,073

 

TOTAL PARTNERS’ CAPITAL

 

86,957,139

 

 

 

52,858,368

 

TOTAL LIABILITIES AND PARTNERS’ CAPITAL

$

401,950,005

 

 

$

388,972,239

 

 

The accompanying notes are an integral part of these consolidated financial statements.

 

8


 

SOTHERLY HOTELS LP

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)

 

 

 

Three Months Ended

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

Nine Months Ended

 

 

 

September 30, 2016

 

 

September 30, 2015

 

 

September 30, 2016

 

 

September 30, 2015

 

REVENUE

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rooms department

 

$

26,665,132

 

 

$

24,132,181

 

 

$

83,896,833

 

 

$

71,819,966

 

Food and beverage department

 

 

8,412,842

 

 

 

7,556,969

 

 

 

26,240,932

 

 

 

23,889,092

 

Other operating departments

 

 

2,197,338

 

 

 

2,252,725

 

 

 

6,772,647

 

 

 

6,073,555

 

Total revenue

 

 

37,275,312

 

 

 

33,941,875

 

 

 

116,910,412

 

 

 

101,782,613

 

EXPENSES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hotel operating expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rooms department

 

 

7,236,932

 

 

 

6,657,947

 

 

 

21,916,775

 

 

 

18,998,964

 

Food and beverage department

 

 

5,820,000

 

 

 

5,562,404

 

 

 

18,250,542

 

 

 

16,668,025

 

Other operating departments

 

 

642,219

 

 

 

491,751

 

 

 

1,880,618

 

 

 

1,192,917

 

Indirect

 

 

14,492,775

 

 

 

13,245,062

 

 

 

43,241,433

 

 

 

37,046,275

 

Total hotel operating expenses

 

 

28,191,926

 

 

 

25,957,164

 

 

 

85,289,368

 

 

 

73,906,181

 

Depreciation and amortization

 

 

3,790,872

 

 

 

3,374,209

 

 

 

11,260,987

 

 

 

9,583,506

 

Loss on disposal of assets

 

 

189,267

 

 

 

207,235

 

 

 

329,461

 

 

 

201,835

 

Corporate general and administrative

 

 

1,367,848

 

 

 

2,437,428

 

 

 

4,331,896

 

 

 

5,379,032

 

Total operating expenses

 

 

33,539,913

 

 

 

31,976,036

 

 

 

101,211,712

 

 

 

89,070,554

 

NET OPERATING INCOME

 

 

3,735,399

 

 

 

1,965,839

 

 

 

15,698,700

 

 

 

12,712,059

 

Other income (expense)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

(4,626,333

)

 

 

(4,245,679

)

 

 

(13,872,129

)

 

 

(11,860,649

)

Interest income

 

 

44,485

 

 

 

15,480

 

 

 

63,523

 

 

 

40,888

 

Equity income in joint venture

 

 

 

 

 

8,173

 

 

 

 

 

 

506,890

 

Loss on early debt extinguishment

 

 

(1,087,395

)

 

 

(74,824

)

 

 

(1,157,688

)

 

 

(772,907

)

Unrealized loss on hedging activities

 

 

(492

)

 

 

(106,808

)

 

 

(66,567

)

 

 

(106,808

)

Gain on change in control

 

 

 

 

 

6,560,958

 

 

 

 

 

 

6,560,958

 

Gain on involuntary conversion of asset