Hotel Dispositions

6 Months Ended

Jun. 30, 2017

Property, Plant and Equipment [Line Items]

HOTEL DISPOSITIONS

On May 1, 2017, the Company sold its three Extended Stay Canada-branded hotels for gross proceeds of 76.0 million Canadian dollars, or approximately $55.3 million. The carrying value of the hotels, including net working capital and allocable goodwill, net of an impairment charge recorded during the three months ended March 31, 2017, was approximately 56.7 million Canadian dollars, or approximately $41.2 million, resulting in a gain on sale of approximately 17.3 million Canadian dollars, or approximately $12.6 million, prior to the evaluation of existing accumulated foreign currency translation loss. Due to the fact that the Company's Canadian subsidiaries liquidated 100% of their assets, approximately $14.5 million of accumulated foreign currency translation loss was recognized in the unaudited condensed consolidated statement of operations during the three and six months ended June 30, 2017. This charge more than fully offset the Canadian subsidiaries' gain on sale, which resulted in a loss on sale of the Canadian hotels of approximately $1.9 million, net of closing costs and adjustments, which is reported in loss on sale of hotel properties during the three and six months ended June 30, 2017 in the accompanying unaudited condensed consolidated statement of operations.

On May 16, 2017, the Company sold one U.S.-based hotel for gross proceeds of $5.4 million. The carrying value of this hotel, including net working capital and allocable goodwill, net of an impairment charge recorded during 2016, was approximately $5.1 million, resulting in no gain or loss on sale, net of closing costs and adjustments.

During the three and six month periods ended June 30, 2017 and June 30, 2016, the four disposed hotel properties contributed total room and other hotel revenues, total operating expenses and income (loss) before income tax expense as follows (in thousands):



	Three Months Ended June 30,			Six Months Ended June 30,
	2017		2016	2017			2016
Total room and other hotel revenues	$	778	3,390	2,940			6,050
Total operating expenses	530		2,597	15,452		⁽¹⁾	5,179
Income (loss) before income tax expense	639		568	(12,199	)	⁽¹⁾	1,066

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(1)	Includes impairment charge recorded during the three months ended March 31, 2017 of approximately $12.4 million related to the three Canadian hotels that were sold.

ESH REIT

Property, Plant and Equipment [Line Items]

Hotel Dispositions

HOTEL DISPOSITIONS

On May 1, 2017, a subsidiary of ESH REIT, together with subsidiaries of the Corporation, sold its three Extended Stay Canada-branded hotels for 76.0 million Canadian dollars, or approximately $55.3 million, of which 67.4 million Canadian dollars, or approximately $49.0 million, related to ESH REIT assets. ESH REIT's carrying value of the hotels, including working capital and allocable goodwill, net of an impairment charge recorded during the three months ended March 31, 2017, was approximately 51.2 million Canadian dollars, or approximately $37.3 million, resulting in a gain on sale of approximately 15.1 million Canadian dollars, or approximately $11.0 million, prior to the evaluation of existing accumulated foreign currency translation loss. Due to the fact that ESH REIT's Canadian subsidiary liquidated 100% of its assets, approximately $12.5 million of accumulated foreign currency translation loss was recognized in the condensed consolidated statement of operations during the three and six months ended June 30, 2017. This charge more than fully offset the Canadian subsidiary's gain on sale, which resulted in a loss on sale of the Canadian hotels of approximately $1.5 million, net of closing costs and adjustments, which is reported in loss on sale of hotel properties during the three and six months ended June 30, 2017 in the accompanying unaudited condensed consolidated statements of operations.

On May 16, 2017, ESH REIT sold one U.S.-based hotel for gross proceeds of $5.4 million. The carrying value of this hotel, including net working capital and allocable goodwill, was approximately $6.8 million, which resulted in a loss on sale of approximately $1.8 million, net of closing costs and adjustments, which is reported in loss on sale of hotel properties during the three and six months ended June 30, 2017 in the accompanying unaudited consolidated statements of operations.

During the three and six month periods ended June 30, 2017 and June 30, 2016, the four disposed hotel properties contributed rental revenues, total operating expenses and income (loss) before income tax expense as follows (in thousands):



	Three Months Ended June 30,			Six Months Ended June 30,
	2017		2016	2017			2016
Rental revenues from Extended Stay America, Inc.	$	641	1,545	2,040			3,000
Total operating expenses	—		666	15,527		⁽¹⁾	1,261
Income (loss) before income tax expense	1,032		654	(13,173	)	⁽¹⁾	1,934

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(1)	Includes impairment charge recorded during the three months ended March 31, 2017 of approximately $15.0 million related to the three Canadian hotels.