Property and Equipment

6 Months Ended

Jun. 30, 2016

Property and Equipment

PROPERTY AND EQUIPMENT

Net investment in property and equipment as of June 30, 2016 and December 31, 2015, consists of the following (in thousands):

	June 30, 2016			December 31, 2015
Hotel properties:
Land and site improvements	$	1,299,815		$	1,296,918
Building and improvements	2,901,286			2,859,227
Furniture, fixtures and equipment	568,149			522,617
Total hotel properties	4,769,250			4,678,762
Corporate furniture, fixtures, equipment, software and other	20,734			22,833
Undeveloped land parcel	1,675			1,675
Total cost	4,791,659			4,703,270
Less accumulated depreciation:
Hotel properties	(864,921		)	(767,240		)
Corporate furniture, fixtures, equipment, software and other	(12,976		)	(14,689		)
Total accumulated depreciation	(877,897		)	(781,929		)
Property and equipment - net	$	3,913,762		$	3,921,341

During the six months ended June 30, 2016 and 2015, the Company, using Level 3 unobservable inputs, assessed property and equipment for potential impairment. No impairment charges were recognized during the six months ended June 30, 2016 or 2015. Quantitative information with respect to unobservable inputs consists of internally developed cash flow models that include the following assumptions, among others: projections of revenues, expenses and hotel related cash flows based on assumed long-term growth rates, demand trends, expected future capital expenditures and estimated discount rates. These assumptions are based on the Company’s historical data and experience, the Company’s budgets, industry projections and micro and macro general economic condition projections.

As of June 30, 2016, substantially all of the hotel properties (625 of 629 hotel properties) are pledged as collateral for ESH REIT’s 2012 Mortgage Loan (as defined in Note 7).

ESH REIT

Property and Equipment

PROPERTY AND EQUIPMENT

Net investment in property and equipment as of June 30, 2016 and December 31, 2015, consists of the following (in thousands): 

	June 30, 2016			December 31, 2015
Hotel properties:
Land and site improvements	$	1,300,579		$	1,297,696
Building and improvements	2,911,000			2,868,943
Furniture, fixtures and equipment	562,329			517,626
Total hotel properties	4,773,908			4,684,265
Undeveloped land parcel	1,675			1,675
Total cost	4,775,583			4,685,940
Less accumulated depreciation	(862,129		)	(765,034		)
Property and equipment - net	$	3,913,454		$	3,920,906

During the six months ended June 30, 2016 and 2015, ESH REIT, using Level 3 unobservable inputs, assessed property and equipment for potential impairment. No impairment charges were recognized during the six months ended June 30, 2016 or 2015. Quantitative information with respect to unobservable inputs consists of internally developed cash flow models that include the following assumptions, among others: projections of revenues, expenses and hotel related cash flows based on assumed long-term growth rates, demand trends, expected future capital expenditures and estimated discount rates. These assumptions are based on ESH REIT’s historical data and experience, budgets, industry projections and micro and macro general economic condition projections.

As of June 30, 2016, substantially all of the hotel properties (625 of 629 hotel properties) are pledged as collateral for ESH REIT’s 2012 Mortgage Loan (as defined in Note 6).