EX-99.1 2 ex_152830.htm EXHIBIT 99.1 ex_152830.htm

 

Exhibit 99.1

 

 

 

Apple Hospitality REIT Reports Results of Operations for Second Quarter 2019

 

RICHMOND, Va. (August 5, 2019) Apple Hospitality REIT, Inc. (NYSE: APLE) (the “Company” or “Apple Hospitality”) today announced results of operations for the second quarter ended June 30, 2019.

 

 

 

 Selected Statistical and Financial Data

As of and For the Three and Six Months Ended June 30

(Unaudited) (in thousands, except statistical and per share amounts)(1)

 

 

   

Three Months Ended

   

Six Months Ended

 
   

June 30,

   

June 30,

 
   

2019

   

2018

   

% Change

   

2019

   

2018

   

% Change

 
                                                 

Net income(2)

  $ 62,090     $ 67,630       (8.2 %)   $ 100,241     $ 109,812       (8.7 %)

Net income per share(2)

  $ 0.28     $ 0.29       (3.4 %)   $ 0.45     $ 0.48       (6.2 %)
                                                 

Adjusted EBITDAre(2)

  $ 126,451     $ 130,915       (3.4 %)   $ 227,118     $ 231,129       (1.7 %)

Comparable Hotels Adjusted Hotel EBITDA(2)

  $ 134,940     $ 135,586       (0.5 %)   $ 242,138     $ 242,120       -  

Comparable Hotels Adjusted Hotel EBITDA Margin %(2)

    39.6 %     40.0 %  

(40 bps)

      37.9 %     38.2 %  

(30 bps)

 

Modified funds from operations (MFFO)(2)

  $ 110,190     $ 117,313       (6.1 %)   $ 194,914     $ 205,215       (5.0 %)

MFFO per share(2)

  $ 0.49     $ 0.51       (3.9 %)   $ 0.87     $ 0.89       (2.2 %)
                                                 

Average Daily Rate (ADR) (Actual)

  $ 141.60     $ 139.58       1.4 %   $ 139.09     $ 137.09       1.5 %

Occupancy (Actual)

    81.4 %     81.7 %     (0.4 %)     77.6 %     78.2 %     (0.8 %)

Revenue Per Available Room (RevPAR) (Actual)

  $ 115.30     $ 114.09       1.1 %   $ 107.95     $ 107.20       0.7 %
                                                 

Comparable Hotels ADR

  $ 141.60     $ 140.94       0.5 %   $ 139.62     $ 138.49       0.8 %

Comparable Hotels Occupancy

    81.4 %     81.9 %     (0.6 %)     77.8 %     78.4 %     (0.8 %)

Comparable Hotels RevPAR

  $ 115.30     $ 115.44       (0.1 %)   $ 108.58     $ 108.62       -  
                                                 

Distributions paid

  $ 67,155     $ 69,060       (2.8 %)   $ 134,343     $ 138,204       (2.8 %)

Distributions paid per share

  $ 0.30     $ 0.30       -     $ 0.60     $ 0.60       -  
                                                 

Total debt outstanding

  $ 1,389,267                                          

Total debt to total capitalization (3)

    28.1 %                                        

 

(1)

Explanations of and reconciliations to net income determined in accordance with generally accepted accounting principles (“GAAP”) of non-GAAP financial measures, Adjusted EBITDAre, Comparable Hotels Adjusted Hotel EBITDA and MFFO, are included below.

(2)  On January 1, 2019, the Company adopted the Financial Accounting Standards Board’s Accounting Standards Update No. 2016-02, Leases (Topic 842). Under the new lease accounting standard, the Company classified four ground leases as finance leases that were previously classified as operating leases in accordance with the previous accounting standard. See discussion below for additional information on the adoption of the new lease accounting standard. 

(3)

Total debt outstanding divided by total debt outstanding plus equity market capitalization based on the Company’s closing share price of $15.86 on June 30, 2019.

 

Comparable Hotels is defined as the 234 hotels owned by the Company as of June 30, 2019. For hotels acquired during the periods noted, the Company has included, as applicable, results of those hotels for periods prior to the Company's ownership, and for dispositions, results have been excluded for the Company's period of ownership. Results for periods prior to the Company's ownership have not been included in the Company's actual Consolidated Financial Statements and are included only for comparison purposes. Results included for periods prior to the Company's ownership are based on information from the prior owner of each hotel and have not been audited or adjusted.

 

Justin Knight, President and Chief Executive Officer of Apple Hospitality REIT, commented, “Despite ongoing supply and cost pressures across the lodging industry, we continued to produce results in line with our expectations. Through portfolio optimization, strategic revenue management and effective cost control measures, we increased actual RevPAR

 

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from the same period last year and generated one of the best Comparable Hotels Adjusted Hotel EBITDA Margins in the sector of 39.6 percent for the second quarter of this year. Demand remains healthy across the majority of our markets, generally keeping pace with new supply, and we anticipate steady fundamentals in the third quarter. We will continue to diligently work to maximize the performance of our hotels and pursue opportunities that will further enhance the strength of our Company.”

 

Portfolio Activity

The Company has outstanding contracts for the potential purchase of seven hotels for a combined total expected purchase price of approximately $216 million, including purchase contracts the Company entered into in July 2019 for a Hilton Garden Inn to be constructed in Madison, Wisconsin, and an existing independent boutique hotel in downtown Richmond, Virginia. The anticipated purchase price of the Hilton Garden Inn to be constructed in Madison, Wisconsin, next to the University of Wisconsin-Madison, is approximately $50 million. The Company expects the hotel will have 176 guest rooms and construction will be completed in late 2020 or early 2021. The existing hotel in downtown Richmond, Virginia, is an independent boutique hotel with 55 guest rooms and an anticipated gross purchase price of approximately $7 million. If all conditions to closing are met, the Company anticipates acquiring the Richmond hotel before the end of 2019. As previously announced, the other five hotels under contract are currently under development and the Company anticipates acquiring the five hotels over the next 12 to 24 months from June 30, 2019, if all conditions to closing are met. There are many conditions to closing under each of the contracts that have not yet been satisfied, and there can be no assurance that closings on the seven hotels will occur.

 

Capital Improvements

Apple Hospitality consistently reinvests in its hotels to maintain and enhance each property’s relevance and competitive position within its respective market. During the six months ended June 30, 2019, the Company invested approximately $33 million in capital expenditures. The Company plans to continue to reinvest in its hotels and anticipates investing an additional $45 million to $55 million in capital improvements during the remainder of 2019, which includes various scheduled renovation projects at approximately 15 to 20 properties, including the Company’s full-service Marriott in Richmond, Virginia.

 

Adoption of New Lease Accounting Standard

On January 1, 2019, the Company adopted Accounting Standards Update No. 2016-02, Leases (Topic 842). Under this standard, lessees are required to recognize most leases on their balance sheets as right-of-use assets and lease liabilities. Leases are classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. Under the new standard, four of the Company’s ground leases that were previously classified as operating leases under the previous accounting standard are classified as financing leases under Topic 842. For these finance leases, effective January 1, 2019, the Company recognizes depreciation and amortization expense and interest and other expense, net in the Company’s consolidated statements of operations, instead of operating ground lease expense. While the total expense recognized over the life of a lease is unchanged, the timing of expense recognition for these finance leases results in higher expense during the earlier years of the lease and lower expense during the later years of the lease. For the three and six months ended June 30, 2019, the Company recognized approximately $2.1 million and $4.0 million of interest expense, respectively, and approximately $1.1 million and $2.2 million of amortization expense, respectively, associated with these four finance leases. Under the previous accounting standard, the Company would have recognized approximately $1.8 million and $3.4 million of cash operating ground lease expense and $1.1 million and $2.2 million of non-cash straight-line ground lease expense and amortization of intangible lease expense during the three and six months ended June 30, 2019, respectively. As a result of the new lease standard, at June 30, 2019, the Company’s balance sheet reflects finance ground lease assets, net, of approximately $142.7 million, operating lease assets, net, of approximately $28.9 million and associated combined lease liabilities of approximately $176.0 million.

 

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Balance Sheet

As of June 30, 2019, Apple Hospitality had approximately $1.4 billion of total outstanding indebtedness with a current combined weighted-average interest rate of approximately 3.8 percent for the remainder of 2019. Excluding unamortized debt issuance costs and fair value adjustments, the Company’s total outstanding indebtedness is comprised of approximately $462 million in property-level debt secured by 29 hotels and $928 million outstanding on its unsecured credit facilities. Apple Hospitality’s undrawn capacity on its unsecured credit facilities at June 30, 2019 was approximately $232 million. The Company’s total debt to total capitalization at June 30, 2019 was approximately 28 percent, which provides Apple Hospitality with financial flexibility to fund capital requirements and pursue opportunities in the marketplace. The Company’s weighted-average debt maturities are 5 years, and the weighted-average maturity of its effectively fixed-rate debt is 4 years at a weighted-average interest rate of 4.0 percent.

 

Shareholder Distributions

Apple Hospitality paid distributions of $0.30 per common share during the three-month period ended June 30, 2019. Based on the Company’s common share closing price of $15.20 on August 1, 2019, the annualized distribution rate of $1.20 per common share represents an annual yield of approximately 7.9 percent. The Company’s Board of Directors, in consultation with management, will continue to regularly monitor the Company’s distribution rate relative to the performance of its hotels, capital improvement needs, varying economic cycles, acquisitions and dispositions. At its discretion, the Company’s Board of Directors may make adjustments as determined to be prudent in relation to other cash requirements of the Company.

 

2019 Outlook

Apple Hospitality is providing its operational and financial outlook for 2019. This outlook, which is based on management’s current view of both operating and economic fundamentals of the Company’s existing portfolio of hotels, does not take into account any unanticipated developments in its business or changes in its operating environment, nor does it take into account any unannounced hotel acquisitions or dispositions. As compared to previously provided 2019 guidance, the Company is narrowing its guidance at both ends of the range for Comparable Hotels RevPAR Change by 25 bps and Comparable Hotels Adjusted Hotel EBITDA Margin % by 20 bps. The Company is maintaining the low end of the range and decreasing the high end of the range by $4 million for Net Income and Adjusted EBITDAre. The reduction in the midpoint of the Company’s guidance for Net Income and Adjusted EBITDAre is a result of higher anticipated general and administrative expenses associated with outperformance of the Company’s relative shareholder return metrics, which are components of the Company’s incentive plans. Comparable Hotels RevPAR Change and Comparable Hotels Adjusted Hotel EBITDA Margin % guidance include properties acquired, as if the hotels were owned as of January 1, 2018, and exclude completed dispositions since January 1, 2018. For the full year 2019, the Company anticipates:

 

   

2019 Guidance(1)

 
   

Low-End

   

High-End

 
             

Net Income

 

$167 Million

   

$188 Million

 
             

Comparable Hotels RevPAR Change

  (0.75%)     0.75%  
             

Comparable Hotels Adjusted Hotel EBITDA Margin %

  36.4%     37.0%  
             

Adjusted EBITDAre

 

$425 Million

   

$441 Million

 

 

 

 

 

 

(1)

Explanations of and reconciliations to net income guidance of Adjusted EBITDAre guidance are included below.

 

 

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Second Quarter 2019 Earnings Conference Call

The Company will host a quarterly conference call for investors and interested parties on Tuesday, August 6, 2019, at 9:00 a.m. Eastern Time. The conference call will be accessible by telephone and the internet. To access the call, participants from within the U.S. should dial 877-407-9039, and participants from outside the U.S. should dial 201-689-8470. Participants may also access the call via live webcast by visiting the Investor Information section of the Company's website at ir.applehospitalityreit.com. A replay of the call will be available from approximately 12:00 p.m. Eastern Time on August 6, 2019, through 11:59 p.m. Eastern Time on August 27, 2019. To access the replay, the domestic dial-in number is 844-512-2921, the international dial-in number is 412-317-6671, and the passcode is 13692023. The archive of the webcast will be available on the Company's website for a limited time.

 

About Apple Hospitality REIT, Inc.

Apple Hospitality REIT, Inc. (NYSE: APLE) is a publicly traded real estate investment trust (REIT) that owns one of the largest and most diverse portfolios of upscale, rooms-focused hotels in the United States. Apple Hospitality’s portfolio consists of 234 hotels with more than 30,000 guest rooms located in 87 markets throughout 34 states. Franchised with industry-leading brands, the Company’s portfolio comprises 108 Marriott-branded hotels, 125 Hilton-branded hotels and one Hyatt-branded hotel. For more information, please visit www.applehospitalityreit.com.

 

Apple Hospitality REIT Non-GAAP Financial Measures

The Company considers the following non-GAAP financial measures useful to investors as key supplemental measures of its operating performance: Funds from Operations (“FFO”); Modified FFO (“MFFO”); Earnings Before Interest, Income Taxes, Depreciation and Amortization (“EBITDA”); Earnings Before Interest, Income Taxes, Depreciation and Amortization for Real Estate (“EBITDAre”); Adjusted EBITDAre (“Adjusted EBITDAre”); and Adjusted Hotel EBITDA (“Adjusted Hotel EBITDA”). These non-GAAP financial measures should be considered along with, but not as alternatives to, net income (loss), cash flow from operations or any other operating GAAP measure. FFO, MFFO, EBITDA, EBITDAre, Adjusted EBITDAre and Adjusted Hotel EBITDA are not necessarily indicative of funds available to fund the Company’s cash needs, including its ability to make cash distributions. Although FFO, MFFO, EBITDA, EBITDAre, Adjusted EBITDAre and Adjusted Hotel EBITDA, as calculated by the Company, may not be comparable to FFO, MFFO, EBITDA, EBITDAre, Adjusted EBITDAre and Adjusted Hotel EBITDA, as reported by other companies that do not define such terms exactly as the Company defines such terms, the Company believes these supplemental measures are useful to investors when comparing the Company’s results between periods and with other REITs. Reconciliations of these non-GAAP financial measures to net income (loss) are provided in the following pages.

 

Forward-Looking Statements Disclaimer

Certain statements contained in this press release, other than historical facts, may be considered forward-looking statements. These forward-looking statements are predictions and generally can be identified by use of statements that include phrases such as “may,” “believe,” “expect,” “anticipate,” “intend,” “estimate,” “project,” “target,” “goal,” “plan,” “should,” “will,” “predict,” “potential,” “outlook,” “strategy,” and similar expressions that convey the uncertainty of future events or outcomes. Such statements involve known and unknown risks, uncertainties, and other factors which may cause the actual results, performance, or achievements of Apple Hospitality to be materially different from future results, performance, or achievements expressed or implied by such forward-looking statements. Such factors include, but are not limited to, the ability of Apple Hospitality to effectively acquire and dispose of properties; the ability of Apple Hospitality to successfully integrate pending transactions and implement its operating strategy; changes in general political, economic and competitive conditions and specific market conditions; adverse changes in the real estate and real estate capital markets; financing risks; litigation risks; regulatory proceedings or inquiries; and changes in laws or regulations or interpretations of current laws and regulations that impact Apple Hospitality’s business, assets or classification as a real estate investment trust. Although Apple Hospitality believes that the assumptions underlying the

 

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forward-looking statements contained herein are reasonable, any of the assumptions could be inaccurate, and therefore there can be no assurance that such statements included in this press release will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by Apple Hospitality or any other person that the results or conditions described in such statements or the objectives and plans of Apple Hospitality will be achieved. In addition, Apple Hospitality’s qualification as a real estate investment trust involves the application of highly technical and complex provisions of the Internal Revenue Code. Readers should carefully review Apple Hospitality’s financial statements and the notes thereto, as well as the risk factors described in Apple Hospitality’s filings with the Securities and Exchange Commission, including, but not limited to, in the section titled “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018. Any forward-looking statement that Apple Hospitality makes speaks only as of the date of such statement. Apple Hospitality undertakes no obligation to publicly update or revise any forward-looking statements or cautionary factors, as a result of new information, future events, or otherwise, except as required by law.

 

Contact: 

Apple Hospitality REIT, Inc.

Kelly Clarke, Vice President, Investor Relations

804-727-6321

kclarke@applereit.com

 

For additional information or to receive press releases by email, visit www.applehospitalityreit.com.

 

 

 

 

 

 

 

 

 

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Apple Hospitality REIT, Inc.

Consolidated Balance Sheets

(in thousands, except share data)

 

   

June 30,

   

December 31,

 
   

2019

   

2018

 
   

(unaudited)

         

Assets

               

   Investment in real estate, net of accumulated depreciation and amortization

      of $971,738 and $909,893, respectively

  $ 4,858,103     $ 4,816,410  

   Restricted cash-furniture, fixtures and other escrows

    33,199       33,632  

   Due from third party managers, net

    52,214       29,091  

   Other assets, net

    45,323       49,539  

      Total Assets

  $ 4,988,839     $ 4,928,672  
                 

Liabilities

               

   Debt, net

  $ 1,384,314     $ 1,412,242  

   Finance lease liabilities

    163,508       -  

   Accounts payable and other liabilities

    88,949       107,420  

      Total Liabilities

    1,636,771       1,519,662  
                 

Shareholders' Equity

               

   Preferred stock, authorized 30,000,000 shares; none issued and outstanding

    -       -  

   Common stock, no par value, authorized 800,000,000 shares; issued and

      outstanding 223,869,190 and 223,997,348 shares, respectively

    4,493,598       4,495,073  

   Accumulated other comprehensive income (loss)

    (6,158 )     10,006  

   Distributions greater than net income

    (1,135,372 )     (1,096,069 )

      Total Shareholders' Equity

    3,352,068       3,409,010  
                 

      Total Liabilities and Shareholders' Equity

  $ 4,988,839     $ 4,928,672  

 

Note: 

The Consolidated Balance Sheets and corresponding footnotes can be found in the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2019.

 

 

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Apple Hospitality REIT, Inc.

Consolidated Statements of Operations and Comprehensive Income 

(Unaudited)

(in thousands, except per share data)

 

   

Three Months Ended

   

Six Months Ended

 
   

June 30,

   

June 30,

 
   

2019

   

2018

   

2019

   

2018

 

Revenues:

                               

    Room

  $ 315,232     $ 319,022     $ 594,702     $ 593,858  

    Food and beverage

    15,692       16,518       30,707       32,228  

    Other

    10,193       9,174       19,495       17,017  

Total revenue

    341,117       344,714       644,904       643,103  
                                 

Expenses:

                               

Hotel operating expense:

                               

    Operating

    80,166       81,242       155,746       157,196  

    Hotel administrative

    26,967       26,558       52,597       51,660  

    Sales and marketing

    30,831       28,168       58,525       53,500  

    Utilities

    9,561       10,247       19,500       20,530  

    Repair and maintenance

    13,041       13,476       25,907       25,929  

    Franchise fees

    14,752       14,781       27,863       27,514  

    Management fees

    11,872       12,059       22,501       22,531  

Total hotel operating expense

    187,190       186,531       362,639       358,860  

    Property taxes, insurance and other

    18,823       18,681       38,031       35,910  

    Operating ground lease

    423       2,912       828       5,762  

    General and administrative

    8,308       6,721       16,445       13,598  

    Loss on impairment of depreciable real estate assets

    -       3,135       -       3,135  

    Depreciation and amortization

    48,109       45,743       96,059       90,583  

Total expense

    262,853       263,723       514,002       507,848  
                                 

    Gain (loss) on sale of real estate

    (161 )     -       1,052       -  
                                 

Operating income

    78,103       80,991       131,954       135,255  
                                 

    Interest and other expense, net

    (15,857 )     (13,210 )     (31,351 )     (25,129 )
                                 

Income before income taxes

    62,246       67,781       100,603       110,126  
                                 

    Income tax expense

    (156 )     (151 )     (362 )     (314 )
                                 

Net income

  $ 62,090     $ 67,630     $ 100,241     $ 109,812  
                                 

Other comprehensive income (loss):

                               

    Interest rate derivatives

    (10,120 )     1,740       (16,164 )     8,032  
                                 

Comprehensive income

  $ 51,970     $ 69,370     $ 84,077     $ 117,844  
                                 

Basic and diluted net income per common share

  $ 0.28     $ 0.29     $ 0.45     $ 0.48  
                                 

Weighted average common shares outstanding - basic and diluted

    223,899       230,342       223,915       230,428  

 

Note:  

The Consolidated Statements of Operations and Comprehensive Income and corresponding footnotes can be found in the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2019.

 

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Apple Hospitality REIT, Inc.

Comparable Hotels Operating Metrics and Statistical Data

(Unaudited) 

(in thousands except statistical data)

 

   

Three Months Ended

   

Six Months Ended

 
   

June 30,

   

June 30,

 
   

2019

   

2018

   

% Change

   

2019

   

2018

   

% Change

 
                                             

Total revenue

  $ 341,051     $ 338,581     0.7%     $ 639,060     $ 633,657     0.9%  
                                             

Total operating expenses

    206,111       202,995     1.5%       396,922       391,537     1.4%  
                                             

Adjusted Hotel EBITDA

  $ 134,940     $ 135,586     (0.5%)     $ 242,138     $ 242,120     -  

Adjusted Hotel EBITDA Margin %

    39.6 %     40.0 %  

(40 bps)

      37.9 %     38.2 %  

(30 bps)

 
                                             
                                             

ADR (Comparable Hotels)

  $ 141.60     $ 140.94     0.5%     $ 139.62     $ 138.49     0.8%  

Occupancy (Comparable Hotels)

    81.4 %     81.9 %   (0.6%)       77.8 %     78.4 %   (0.8%)  

RevPAR (Comparable Hotels)

  $ 115.30     $ 115.44     (0.1%)     $ 108.58     $ 108.62     -  
                                             

ADR (Actual)

  $ 141.60     $ 139.58     1.4%     $ 139.09     $ 137.09     1.5%  

Occupancy (Actual)

    81.4 %     81.7 %   (0.4%)       77.6 %     78.2 %   (0.8%)  

RevPAR (Actual)

  $ 115.30     $ 114.09     1.1%     $ 107.95     $ 107.20     0.7%  
                                             

Reconciliation to Actual Results

                                           
                                             

Total Revenue (Actual)

  $ 341,117     $ 344,714           $ 644,904     $ 643,103        

Revenue from acquisitions prior to ownership

    -       4,065             1,149       9,668        

Revenue from dispositions

    -       (10,132 )           (6,861 )     (18,982 )      

Lease revenue intangible amortization

    (66 )     (66 )           (132 )     (132 )      

Comparable Hotels Total Revenue

  $ 341,051     $ 338,581           $ 639,060     $ 633,657        
                                             

Adjusted Hotel EBITDA (AHEBITDA) (Actual)

  $ 134,759     $ 137,636           $ 243,563     $ 244,727        

AHEBITDA from acquisitions prior to ownership

    -       1,379             310       3,528        

AHEBITDA from dispositions

    181       (3,429 )           (1,735 )     (6,135 )      

Comparable Hotels AHEBITDA

  $ 134,940     $ 135,586           $ 242,138     $ 242,120        

 

Note:

Comparable Hotels is defined as the 234 hotels owned by the Company as of June 30, 2019. For hotels acquired during the periods noted, the Company has included, as applicable, results of those hotels for periods prior to the Company's ownership, and for dispositions, results have been excluded for the Company's period of ownership. Results for periods prior to the Company's ownership have not been included in the Company's actual Consolidated Financial Statements and are included only for comparison purposes. Results included for periods prior to the Company's ownership are based on information from the prior owner of each hotel and have not been audited or adjusted.

 

Reconciliation of net income to non-GAAP financial measures and a discussion of the Company’s adoption of Accounting Standards Update No. 2016-02, Leases, on January 1, 2019 are included in the following pages. 

 

Page | 8

 

 

Apple Hospitality REIT, Inc.

Comparable Hotels Quarterly Operating Metrics and Statistical Data

(Unaudited) 

(in thousands except statistical data)

 

   

Three Months Ended

 
   

9/30/2017

   

12/31/2017

   

3/31/2018

   

6/30/2018

   

9/30/2018

   

12/31/2018

   

3/31/2019

   

6/30/2019

 
                                                                 

Total revenue

  $ 327,354     $ 288,753     $ 295,076     $ 338,581     $ 326,521     $ 290,016     $ 298,009     $ 341,051  
                                                                 

Total operating expenses

    198,098       187,119       188,542       202,995       202,263       189,244       190,811       206,111  
                                                                 

Adjusted Hotel EBITDA

  $ 129,256     $ 101,634     $ 106,534     $ 135,586     $ 124,258     $ 100,772     $ 107,198     $ 134,940  

Adjusted Hotel EBITDA Margin %

    39.5 %     35.2 %     36.1 %     40.0 %     38.1 %     34.7 %     36.0 %     39.6 %
                                                                 
                                                                 

ADR (Comparable Hotels)

  $ 139.34     $ 131.80     $ 135.76     $ 140.94     $ 138.91     $ 132.94     $ 137.41     $ 141.60  

Occupancy (Comparable Hotels)

    80.6 %     73.8 %     74.9 %     81.9 %     79.1 %     72.7 %     74.1 %     81.4 %

RevPAR (Comparable Hotels)

  $ 112.35     $ 97.26     $ 101.69     $ 115.44     $ 109.93     $ 96.63     $ 101.76     $ 115.30  
                                                                 

ADR (Actual)

  $ 136.73     $ 130.30     $ 134.32     $ 139.58     $ 137.77     $ 131.93     $ 136.36     $ 141.60  

Occupancy (Actual)

    80.0 %     73.5 %     74.6 %     81.7 %     78.9 %     72.5 %     73.9 %     81.4 %

RevPAR (Actual)

  $ 109.45     $ 95.76     $ 100.18     $ 114.09     $ 108.70     $ 95.63     $ 100.71     $ 115.30  
                                                                 

Reconciliation to Actual Results

                                                               
                                                                 

Total Revenue (Actual)

  $ 324,926     $ 289,067     $ 298,389     $ 344,714     $ 332,197     $ 295,255     $ 303,787     $ 341,117  

Revenue from acquisitions prior to ownership

    15,045       8,643       5,603       4,065       2,757       2,262       1,149       -  

Revenue from dispositions

    (12,566 )     (8,906 )     (8,850 )     (10,132 )     (8,367 )     (7,435 )     (6,861 )     -  

Lease revenue intangible amortization

    (51 )     (51 )     (66 )     (66 )     (66 )     (66 )     (66 )     (66 )

Comparable Hotels Total Revenue

  $ 327,354     $ 288,753     $ 295,076     $ 338,581     $ 326,521     $ 290,016     $ 298,009     $ 341,051  
                                                                 

Adjusted Hotel EBITDA (AHEBITDA) (Actual)

  $ 125,750     $ 101,159     $ 107,091     $ 137,636     $ 125,922     $ 102,157     $ 108,804     $ 134,759  

AHEBITDA from acquisitions prior to ownership

    7,137       3,091       2,149       1,379       814       633       310       -  

AHEBITDA from dispositions

    (3,631 )     (2,616 )     (2,706 )     (3,429 )     (2,478 )     (2,018 )     (1,916 )     181  

Comparable Hotels AHEBITDA

  $ 129,256     $ 101,634     $ 106,534     $ 135,586     $ 124,258     $ 100,772     $ 107,198     $ 134,940  

 

Note:

Comparable Hotels is defined as the 234 hotels owned by the Company as of June 30, 2019. For hotels acquired during the periods noted, the Company has included, as applicable, results of those hotels for periods prior to the Company's ownership, and for dispositions, results have been excluded for the Company's period of ownership. Results for periods prior to the Company's ownership have not been included in the Company's actual Consolidated Financial Statements and are included only for comparison purposes. Results included for periods prior to the Company's ownership are based on information from the prior owner of each hotel and have not been audited or adjusted.

 

 

Reconciliation of net income (loss) to non-GAAP financial measures and a discussion of the Company’s adoption of Accounting Standards Update No. 2016-02, Leases, on January 1, 2019 are included in the following pages.

 

Page | 9

 

 

Apple Hospitality REIT, Inc.

Same Store Hotels Operating Metrics and Statistical Data

(Unaudited) 

(in thousands except statistical data)

 

   

Three Months Ended

   

Six Months Ended

 
   

June 30,

   

June 30,

 
   

2019

   

2018

   

% Change

   

2019

   

2018

   

% Change

 
                                             

Total revenue

  $ 330,817     $ 329,810     0.3%     $ 618,449     $ 616,893     0.3%  
                                             

Total operating expenses

    199,449       197,566     1.0%       384,118       381,357     0.7%  
                                             

Adjusted Hotel EBITDA

  $ 131,368     $ 132,244     (0.7%)     $ 234,331     $ 235,536     (0.5%)  

Adjusted Hotel EBITDA Margin %

    39.7 %     40.1 %  

(40 bps)

      37.9 %     38.2 %  

(30 bps)

 
                                             
                                             

ADR (Same Store Hotels)

  $ 141.52     $ 140.72     0.6%     $ 139.11     $ 138.13     0.7%  

Occupancy (Same Store Hotels)

    81.8 %     82.1 %   (0.4%)       78.0 %     78.5 %   (0.6%)  

RevPAR (Same Store Hotels)

  $ 115.73     $ 115.59     0.1%     $ 108.52     $ 108.45     0.1%  
                                             

ADR (Actual)

  $ 141.60     $ 139.58     1.4%     $ 139.09     $ 137.09     1.5%  

Occupancy (Actual)

    81.4 %     81.7 %   (0.4%)       77.6 %     78.2 %   (0.8%)  

RevPAR (Actual)

  $ 115.30     $ 114.09     1.1%     $ 107.95     $ 107.20     0.7%  
                                             

Reconciliation to Actual Results

                                           
                                             

Total Revenue (Actual)

  $ 341,117     $ 344,714           $ 644,904     $ 643,103        

Revenue from acquisitions

    (10,234 )     (4,706 )           (19,462 )     (7,096 )      

Revenue from dispositions

    -       (10,132 )           (6,861 )     (18,982 )      

Lease revenue intangible amortization

    (66 )     (66 )           (132 )     (132 )      

Same Store Hotels Total Revenue

  $ 330,817     $ 329,810           $ 618,449     $ 616,893        
                                             

Adjusted Hotel EBITDA (AHEBITDA) (Actual)

  $ 134,759     $ 137,636           $ 243,563     $ 244,727        

AHEBITDA from acquisitions

    (3,572 )     (1,963 )           (7,497 )     (3,056 )      

AHEBITDA from dispositions

    181       (3,429 )           (1,735 )     (6,135 )      

Same Store Hotels AHEBITDA

  $ 131,368     $ 132,244           $ 234,331     $ 235,536        

 

Note:

Same Store Hotels is defined as the 227 hotels owned and held for use by the Company as of January 1, 2018 and during the entirety of the periods being compared. This information has not been audited.

 

Reconciliation of net income to non-GAAP financial measures and a discussion of the Company’s adoption of Accounting Standards Update No. 2016-02, Leases, on January 1, 2019 are included in the following pages.

 

Page | 10

 

 

Apple Hospitality REIT, Inc.

Same Store Hotels Quarterly Operating Metrics and Statistical Data

(Unaudited) 

(in thousands except statistical data)

 

   

Three Months Ended

 
   

3/31/2018

   

6/30/2018

   

9/30/2018

   

12/31/2018

   

3/31/2019

   

6/30/2019

 
                                                 

Total revenue

  $ 287,083     $ 329,810     $ 317,636     $ 280,871     $ 287,632     $ 330,817  
                                                 

Total operating expenses

    183,791       197,566       196,608       183,583       184,669       199,449  
                                                 

Adjusted Hotel EBITDA

  $ 103,292     $ 132,244     $ 121,028     $ 97,288     $ 102,963     $ 131,368  

Adjusted Hotel EBITDA Margin %

    36.0 %     40.1 %     38.1 %     34.6 %     35.8 %     39.7 %
                                                 
                                                 

ADR (Same Store Hotels)

  $ 135.26     $ 140.72     $ 138.87     $ 132.42     $ 136.42     $ 141.52  

Occupancy (Same Store Hotels)

    74.8 %     82.1 %     79.4 %     72.8 %     74.2 %     81.8 %

RevPAR (Same Store Hotels)

  $ 101.23     $ 115.59     $ 110.23     $ 96.40     $ 101.23     $ 115.73  
                                                 

ADR (Actual)

  $ 134.32     $ 139.58     $ 137.77     $ 131.93     $ 136.36     $ 141.60  

Occupancy (Actual)

    74.6 %     81.7 %     78.9 %     72.5 %     73.9 %     81.4 %

RevPAR (Actual)

  $ 100.18     $ 114.09     $ 108.70     $ 95.63     $ 100.71     $ 115.30  
                                                 

Reconciliation to Actual Results

                                               
                                                 

Total Revenue (Actual)

  $ 298,389     $ 344,714     $ 332,197     $ 295,255     $ 303,787     $ 341,117  

Revenue from acquisitions

    (2,390 )     (4,706 )     (6,128 )     (6,883 )     (9,228 )     (10,234 )

Revenue from dispositions

    (8,850 )     (10,132 )     (8,367 )     (7,435 )     (6,861 )     -  

Lease revenue intangible amortization

    (66 )     (66 )     (66 )     (66 )     (66 )     (66 )

Same Store Hotels Total Revenue

  $ 287,083     $ 329,810     $ 317,636     $ 280,871     $ 287,632     $ 330,817  
                                                 

Adjusted Hotel EBITDA (AHEBITDA) (Actual)

  $ 107,091     $ 137,636     $ 125,922     $ 102,157     $ 108,804     $ 134,759  

AHEBITDA from acquisitions

    (1,093 )     (1,963 )     (2,416 )     (2,851 )     (3,925 )     (3,572 )

AHEBITDA from dispositions

    (2,706 )     (3,429 )     (2,478 )     (2,018 )     (1,916 )     181  

Same Store Hotels AHEBITDA

  $ 103,292     $ 132,244     $ 121,028     $ 97,288     $ 102,963     $ 131,368  

 

Note:

Same Store Hotels is defined as the 227 hotels owned and held for use by the Company as of January 1, 2018 and during the entirety of the periods being compared. This information has not been audited.

 

Reconciliation of net income to non-GAAP financial measures and a discussion of the Company’s adoption of Accounting Standards Update No. 2016-02, Leases, on January 1, 2019 are included in the following pages.

 

Page | 11

 

 

Apple Hospitality REIT, Inc.

Reconciliation of Net Income (Loss) to EBITDA, EBITDAre, Adjusted EBITDAre and Adjusted Hotel EBITDA

(Unaudited)

(in thousands)

 

EBITDA is a commonly used measure of performance in many industries and is defined as net income (loss) excluding interest, income taxes, depreciation and amortization. The Company believes EBITDA is useful to investors because it helps the Company and its investors evaluate the ongoing operating performance of the Company by removing the impact of its capital structure (primarily interest expense) and its asset base (primarily depreciation and amortization). In addition, certain covenants included in the agreements governing the Company’s indebtedness use EBITDA, as defined in the specific credit agreement, as a measure of financial compliance.

 

In addition to EBITDA, the Company also calculates and presents EBITDAre in accordance with standards established by the National Association of Real Estate Investment Trusts (“Nareit”), which defines EBITDAre as EBITDA, excluding gains and losses from the sale of certain real estate assets (including gains and losses from change in control), plus real estate related impairments, and adjustments to reflect the entity’s share of EBITDAre of unconsolidated affiliates. The Company presents EBITDAre because it believes that it provides further useful information to investors in comparing its operating performance between periods and between REITs that report EBITDAre using the Nareit definition.

 

The Company also considers the exclusion of non-cash straight-line operating ground lease expense from EBITDAre useful, as this expense does not reflect the underlying performance of the related hotels (Adjusted EBITDAre).

 

The Company further excludes actual corporate-level general and administrative expense for the Company from Adjusted EBITDAre (Adjusted Hotel EBITDA) to isolate property-level operational performance over which the Company’s hotel operators have direct control. The Company believes Adjusted Hotel EBITDA provides useful supplemental information to investors regarding operating performance and is used by management to measure the performance of the Company’s hotels and effectiveness of the operators of the hotels.

 

The following table reconciles the Company’s GAAP net income (loss) to EBITDA, EBITDAre, Adjusted EBITDAre and Adjusted Hotel EBITDA on a quarterly basis from September 30, 2017 through June 30, 2019.

 

   

Three Months Ended

 
   

9/30/2017

   

12/31/2017

   

3/31/2018

   

6/30/2018

   

9/30/2018

   

12/31/2018

   

3/31/2019

   

6/30/2019

 

Net income (loss)

  $ 62,824     $ (2,303 )   $ 42,182     $ 67,630     $ 62,122     $ 34,152     $ 38,151     $ 62,090  

Depreciation and amortization

    44,110       44,729       44,840       45,743       46,169       46,730       47,950       48,109  

Amortization of favorable and unfavorable operating leases, net

    165       165       206       148       146       147       31       31  

Interest and other expense, net

    12,024       11,753       11,919       13,210       13,140       12,916       15,494       15,857  

Income tax expense

    203       135       163       151       100       173       206       156  

EBITDA

    119,326       54,479       99,310       126,882       121,677       94,118       101,832       126,243  

(Gain) loss on sale of real estate

    157       (312 )     -       -       -       (152 )     (1,213 )     161  

Loss on impairment of depreciable real estate assets

    -       38,000       -       3,135       -       -       -       -  

EBITDAre

    119,483       92,167       99,310       130,017       121,677       93,966       100,619       126,404  

Non-cash straight-line operating ground lease expense

    917       906       904       898       875       865       48       47  

Adjusted EBITDAre

  $ 120,400     $ 93,073     $ 100,214     $ 130,915     $ 122,552     $ 94,831     $ 100,667     $ 126,451  

General and administrative expense

    5,350       8,086       6,877       6,721       3,370       7,326       8,137       8,308  

Adjusted Hotel EBITDA

  $ 125,750     $ 101,159     $ 107,091     $ 137,636     $ 125,922     $ 102,157     $ 108,804     $ 134,759  
                                                                 

Cash operating ground lease expense for leases classified as financing leases effective January 1, 2019(1)

  $ 1,391     $ 1,402     $ 1,405     $ 1,410     $ 1,432     $ 1,443     $ -     $ -  

 

(1)

Represents cash lease payments recorded to operating ground lease expense related to four of the Company's ground leases that were classified as operating leases during the noted period. Under the new lease accounting standard, effective January 1, 2019, these four ground leases are classified as finance leases, for which the Company recognizes depreciation and amortization expense and interest and other expense, net in the Company's consolidated statements of operations, instead of operating ground lease expense. Depreciation and amortization and interest expense are excluded from EBITDA and operating ground lease expense is included in EBITDA.  

 

 

Page | 12

 

 

Apple Hospitality REIT, Inc.

Reconciliation of Net Income to FFO and MFFO

(Unaudited)

(in thousands)

 

The Company calculates and presents FFO in accordance with standards established by Nareit, which defines FFO as net income (loss) (computed in accordance with GAAP), excluding gains and losses from the sale of certain real estate assets (including gains and losses from change in control), extraordinary items as defined by GAAP, and the cumulative effect of changes in accounting principles, plus real estate related depreciation, amortization and impairments, and adjustments for unconsolidated affiliates. Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values instead have historically risen or fallen with market conditions, most real estate industry investors consider FFO to be helpful in evaluating a real estate company’s operations. The Company further believes that by excluding the effects of these items, FFO is useful to investors in comparing its operating performance between periods and between REITs that report FFO using the Nareit definition. FFO as presented by the Company is applicable only to its common shareholders, but does not represent an amount that accrues directly to common shareholders.

 

The Company further adjusts FFO (MFFO) for the exclusion of amortization of finance ground lease assets, amortization of favorable and unfavorable operating leases, net and non-cash straight-line operating ground lease expense, as these expenses do not reflect the underlying performance of the related hotels. The Company presents MFFO when evaluating its performance because it believes that it provides further useful supplemental information to investors regarding its ongoing operating performance.

 

The following table reconciles the Company’s GAAP net income to FFO and MFFO for the three and six months ended June 30, 2019 and 2018.

 

   

Three Months Ended June 30,

   

Six Months Ended June 30,

 
   

2019

   

2018

   

2019

   

2018

 

Net income

  $ 62,090     $ 67,630     $ 100,241     $ 109,812  

Depreciation of real estate owned

    46,712       45,502       93,378       90,112  

(Gain) Loss on sale of real estate

    161       -       (1,052 )     -  

Loss on impairment of depreciable real estate assets

    -       3,135       -       3,135  

Funds from operations

    108,963       116,267       192,567       203,059  

Amortization of finance ground lease assets

    1,149       -       2,190       -  

Amortization of favorable and unfavorable operating leases, net

    31       148       62       354  

Non-cash straight-line operating ground lease expense

    47       898       95       1,802  

Modified funds from operations

  $ 110,190     $ 117,313     $ 194,914     $ 205,215  

 

Page | 13

 

 

Apple Hospitality REIT, Inc.

2019 Guidance Reconciliation of Net Income to EBITDA, EBITDAre and Adjusted EBITDAre

(Unaudited)

(in thousands)

 

The guidance of net income, EBITDA, EBITDAre and Adjusted EBITDAre are forward-looking statements and are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors which may cause actual results and performance to differ materially from those expressed or implied by these forecasts. Although the Company believes the expectations reflected in the forecasts are based upon reasonable assumptions, there can be no assurance that the expectations will be achieved or that the results will not be materially different. Risks that may affect these assumptions and forecasts include, but are not limited to, the following: changes in political, economic, competitive and specific market conditions; the amount and timing of acquisitions and dispositions of hotel properties; the level of capital expenditures may change significantly, which will directly affect the level of depreciation expense, interest expense and net income; the amount and timing of debt repayments may change significantly based on market conditions, which will directly affect the level of interest expense and net income; the amount and timing of transactions involving the Company's common stock may change based on market conditions; and other risks and uncertainties associated with the Company's business described herein and in filings with the Securities and Exchange Commission, including the Company's Annual Report on Form 10-K for the year ended December 31, 2018.

 

The following table reconciles the Company’s GAAP net income guidance to EBITDA, EBITDAre and Adjusted EBITDAre guidance for the year ending December 31, 2019.

 

   

Year Ending December 31, 2019

 
   

Low-End

   

High-End

 

Net income(1)

  $ 167,427     $ 187,527  

Depreciation and amortization(1)

    194,000       191,700  

Amortization of favorable and unfavorable leases, net

    125       125  

Interest and other expense, net(1)

    63,700       61,700  

Income tax expense

    600       800  

EBITDA

    425,852       441,852  

Gain on sale of real estate

    (1,052 )     (1,052 )

EBITDAre

    424,800       440,800  

Non-cash straight-line ground lease expense

    200       200  

Adjusted EBITDAre

  $ 425,000     $ 441,000  

 

(1)

As a result of the Company's adoption of Leases Topic 842, the Company has included approximately $4.5 million of amortization related to its four finance ground lease assets and $8.2 million of interest expense associated with the related finance lease liabilities. Under the previous accounting standard, the Company would have included approximately $7.0 million of cash operating ground lease expense related to these four ground leases.   

    

 

 

 

Page | 14

 

 

Apple Hospitality REIT, Inc.

Debt Summary

(Unaudited)

($ in thousands)

June 30, 2019

 

   

July 1 - December 31, 2019

   

2020

   

2021

   

2022

   

2023

   

Thereafter

   

Total

   

Fair Market Value

 

Total debt:

                                                               

Maturities

  $ 6,600     $ 28,349     $ 47,586     $ 301,952     $ 295,615     $ 709,165     $ 1,389,267     $ 1,394,440  

Average interest rates (1)

    3.8 %     3.9 %     3.9 %     3.9 %     3.9 %     4.0 %                
                                                                 

Variable rate debt:

                                                               

Maturities

  $ -     $ -     $ -     $ 192,700     $ 250,000     $ 485,000     $ 927,700     $ 929,318  

Average interest rates (1)

    3.4 %     3.6 %     3.8 %     3.8 %     3.9 %     4.0 %                
                                                                 

Fixed rate debt:

                                                               

Maturities

  $ 6,600     $ 28,349     $ 47,586     $ 109,252     $ 45,615     $ 224,165     $ 461,567     $ 465,122  

Average interest rates

    4.4 %     4.4 %     4.4 %     4.2 %     4.1 %     4.1 %                

(1)

The average interest rate gives effect to interest rate swaps, as applicable.

 

Note:  

See further information on the Company’s indebtedness in the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2019.

 

  

 

Page | 15

 

 

Apple Hospitality REIT, Inc.

Comparable Hotels Operating Metrics Top 20 Markets

Three Months ended June 30

(Unaudited)

 

Top 20 Markets

         

Occupancy

   

ADR

   

RevPAR

   

% of Adjusted Hotel EBITDA

 
   

# of Hotels

   

Q2 2019

   

Q2 2018

   

% Change

   

Q2 2019

   

Q2 2018

   

% Change

   

Q2 2019

   

Q2 2018

   

% Change

   

Q2 2019

 

Top 20 Markets

                                                                                       

Los Angeles/Long Beach, CA

    8       86.7 %     90.8 %     (4.5 )%   $ 181.79     $ 174.46       4.2 %   $ 157.56     $ 158.33       (0.5 )%     5.7 %

San Diego, CA

    7       83.3 %     83.6 %     (0.3 )%   $ 162.59     $ 156.89       3.6 %   $ 135.49     $ 131.12       3.3 %     5.4 %

Chicago, IL

    8       80.7 %     82.2 %     (1.7 )%   $ 134.67     $ 134.75       (0.1 )%   $ 108.71     $ 110.70       (1.8 )%     4.1 %

Nashville, TN

    5       88.6 %     89.7 %     (1.2 )%   $ 172.80     $ 180.08       (4.0 )%   $ 153.11     $ 161.50       (5.2 )%     3.5 %

Anaheim/Santa Ana, CA

    6       85.4 %     86.0 %     (0.6 )%   $ 144.83     $ 147.93       (2.1 )%   $ 123.70     $ 127.17       (2.7 )%     3.4 %

Seattle, WA

    3       88.4 %     87.8 %     0.6 %   $ 195.34     $ 208.48       (6.3 )%   $ 172.62     $ 183.10       (5.7 )%     3.1 %

Phoenix, AZ

    9       73.9 %     71.1 %     4.0 %   $ 116.90     $ 109.94       6.3 %   $ 86.43     $ 78.12       10.6 %     2.8 %

Omaha, NE

    4       86.1 %     81.5 %     5.6 %   $ 152.31     $ 159.87       (4.7 )%   $ 131.15     $ 130.30       0.6 %     2.7 %

North Carolina East

    5       90.1 %     83.8 %     7.5 %   $ 141.50     $ 130.12       8.7 %   $ 127.55     $ 109.08       16.9 %     2.6 %

Richmond/Petersburg, VA

    4       75.9 %     78.4 %     (3.2 )%   $ 152.51     $ 149.95       1.7 %   $ 115.81     $ 117.60       (1.5 )%     2.5 %

Florida Panhandle

    5       86.1 %     83.6 %     3.0 %   $ 164.01     $ 125.13       31.1 %   $ 141.13     $ 104.55       35.0 %     2.5 %

Dallas, TX

    8       75.7 %     75.2 %     0.7 %   $ 122.04     $ 123.86       (1.5 )%   $ 92.42     $ 93.15       (0.8 )%     2.3 %

Washington, DC-MD-VA

    4       87.7 %     86.1 %     1.8 %   $ 148.56     $ 152.63       (2.7 )%   $ 130.22     $ 131.40       (0.9 )%     2.3 %

Norfolk/Virginia Beach, VA

    4       87.0 %     87.8 %     (1.0 )%   $ 164.09     $ 154.56       6.2 %   $ 142.72     $ 135.75       5.1 %     2.2 %

Austin, TX

    7       80.9 %     81.3 %     (0.5 )%   $ 123.69     $ 126.02       (1.8 )%   $ 100.01     $ 102.46       (2.4 )%     2.1 %

Alaska

    2       90.3 %     86.9 %     3.9 %   $ 221.03     $ 184.99       19.5 %   $ 199.51     $ 160.75       24.1 %     2.1 %

Oklahoma City, OK

    4       80.9 %     79.9 %     1.3 %   $ 144.73     $ 143.33       1.0 %   $ 117.05     $ 114.45       2.3 %     2.0 %

Denver, CO

    3       82.6 %     82.3 %     0.3 %   $ 159.07     $ 160.11       (0.6 )%   $ 131.38     $ 131.84       (0.3 )%     1.9 %

Alabama South

    6       82.0 %     79.2 %     3.5 %   $ 123.50     $ 117.41       5.2 %   $ 101.26     $ 92.97       8.9 %     1.7 %

Fort Worth/Arlington, TX

    5       79.1 %     80.0 %     (1.2 )%   $ 133.14     $ 134.94       (1.3 )%   $ 105.25     $ 107.93       (2.5 )%     1.7 %

Top 20 Markets

    107       82.6 %     82.3 %     0.4 %   $ 149.50     $ 146.84       1.8 %   $ 123.47     $ 120.82       2.2 %     56.6 %
                                                                                         

All Other Markets

    127       80.3 %     81.6 %     (1.5 )%   $ 133.83     $ 135.21       (1.0 )%   $ 107.48     $ 110.27       (2.5 )%     43.4 %
                                                                                         
                                                                                         

Total Portfolio

    234       81.4 %     81.9 %     (0.6 )%   $ 141.60     $ 140.94       0.5 %   $ 115.30     $ 115.44       (0.1 )%     100.0 %

 

Note: Market categorization based on STR designation. Top 20 markets based on Comparable Hotels Adjusted Hotel EBITDA contribution. 

 

Page | 16

 

 

Apple Hospitality REIT, Inc.

Comparable Hotels Operating Metrics Top 20 Markets

Six Months ended June 30

(Unaudited)

 

Top 20 Markets

         

Occupancy

   

ADR

   

RevPAR

   

% of Adjusted Hotel EBITDA