10-Q

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, 2021

OR

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

    For the transition period from ________________ to ________________

Commission file number: 001-35972

BRAEMAR HOTELS & RESORTS INC.

(Exact name of registrant as specified in its charter)

Maryland	46-2488594
(State or other jurisdiction of incorporation or organization)	(IRS employer identification number)
14185 Dallas Parkway
Suite 1200
Dallas
Texas	75254
(Address of principal executive offices)	(Zip code)

(972) 490-9600

(Registrant’s telephone number, including area code)

    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. ☑ Yes ☐ No

    Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☑ Yes ☐ No

    Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “small reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☑
Non-accelerated filer	☐	Smaller reporting company	☑
		Emerging growth company	☐

If an emerging growth company, indicate by check mark 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. ☐

    Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes ☑ No

    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	BHR	New York Stock Exchange
Preferred Stock, Series B	BHR-PB	New York Stock Exchange
Preferred Stock, Series D	BHR-PD	New York Stock Exchange

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Common Stock, $0.01 par value per share	64,503,016
(Class)	Outstanding at November 3, 2021

BRAEMAR HOTELS & RESORTS INC.

FORM 10-Q

FOR THE QUARTER ENDED September 30, 2021

TABLE OF CONTENTS

PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS (unaudited)
Condensed Consolidated Balance Sheets as of September 30, 2021 and December 31, 2020	2
Condensed Consolidated Statements of Operations for the Three and Nine Months Ended September 30, 2021 and 2020	3
Condensed Consolidated Statements of Comprehensive Income (Loss) for the Three and Nine Months Ended September 30, 2021 and 2020	4
Condensed Consolidated Statements of Equity for the Three and Nine Months Ended September 30, 2021 and 2020	5
Condensed Consolidated Statements of Cash Flows for the Three and Nine Months Ended September 30, 2021 and 2020	7
Notes to Condensed Consolidated Financial Statements	9
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	36
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	58
ITEM 4. CONTROLS AND PROCEDURES	59
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS	59
ITEM 1A. RISK FACTORS	60
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	60
ITEM 3. DEFAULTS UPON SENIOR SECURITIES	61
ITEM 4. MINE SAFETY DISCLOSURES	61
ITEM 5. OTHER INFORMATION	61
ITEM 6. EXHIBITS	61
SIGNATURES	63

PART I. FINANCIAL INFORMATION

ITEM 1.    FINANCIAL STATEMENTS (unaudited)

BRAEMAR HOTELS & RESORTS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(unaudited, in thousands, except share and per share amounts)

	September 30, 2021		December 31, 2020
ASSETS
Investments in hotel properties, gross	$	1,847,755	$	1,784,849
Accumulated depreciation	(395,753)		(360,259)
Investments in hotel properties, net	1,452,002		1,424,590
Cash and cash equivalents	195,517		78,606
Restricted cash	44,753		34,544
Accounts receivable, net of allowance of $126 and $227, respectively	17,317		13,557
Inventories	2,718		2,551
Prepaid expenses	4,297		4,405
Investment in unconsolidated entity	1,627		1,708
Derivative assets	74		—
Operating lease right-of-use assets	80,593		81,260
Other assets	14,439		14,898
Intangible assets, net	4,356		4,640
Due from related parties, net	1,910		991
Due from third-party hotel managers	20,390		12,271
Total assets	$	1,839,993	$	1,674,021
LIABILITIES AND EQUITY
Liabilities:
Indebtedness, net	$	1,172,787	$	1,130,594
Accounts payable and accrued expenses	89,265		61,758
Dividends and distributions payable	2,112		2,736
Due to Ashford Inc.	820		2,772
Due to third-party hotel managers	1,665		1,393
Operating lease liabilities	60,876		60,917
Other liabilities	20,699		18,077
Derivative liabilities	1,338		—
Total liabilities	1,349,562		1,278,247
Commitments and contingencies (note 15)
5.50% Series B cumulative convertible preferred stock, $0.01 par value, 3,078,017 and 5,031,473 shares issued and outstanding at September 30, 2021 and December 31, 2020	65,426		106,949
Series E redeemable preferred stock, $0.01 par value, 265,637 and 0 shares issued and outstanding at September 30, 2021 and December 31, 2020	6,110		—
Series M redeemable preferred stock, $0.01 par value, 14,644 and 0 shares issued and outstanding at September 30, 2021 and December 31, 2020	361		—
Redeemable noncontrolling interests in operating partnership	39,948		27,655
Equity:
Preferred stock, $0.01 value, 80,000,000 shares authorized:
8.25% Series D cumulative preferred stock, 1,600,000 shares issued and outstanding at September 30, 2021 and December 31, 2020	16		16
Common stock, $0.01 par value, 250,000,000 shares authorized, 63,974,117 and 38,274,770 shares issued and outstanding at September 30, 2021 and December 31, 2020, respectively	639		382
Additional paid-in capital	698,481		541,870
Accumulated deficit	(303,836)		(266,010)
Total stockholders’ equity of the Company	395,300		276,258
Noncontrolling interest in consolidated entities	(16,714)		(15,088)
Total equity	378,586		261,170
Total liabilities and equity	$	1,839,993	$	1,674,021

See Notes to Condensed Consolidated Financial Statements.

2

BRAEMAR HOTELS & RESORTS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited, in thousands, except per share amounts)

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
REVENUE
Rooms	$	77,560	$	28,118	$	195,720	$	105,119
Food and beverage	24,494		8,537		60,976		39,417
Other	14,123		8,099		40,439		30,633
Total hotel revenue	116,177		44,754		297,135		175,169
EXPENSES
Hotel operating expenses:
Rooms	17,072		7,975		41,569		29,300
Food and beverage	20,252		7,994		50,526		35,544
Other expenses	36,124		20,516		98,143		75,585
Management fees	3,595		1,321		9,079		5,664
Total hotel operating expenses	77,043		37,806		199,317		146,093
Property taxes, insurance and other	12,622		6,929		27,076		21,833
Depreciation and amortization	18,284		18,507		54,881		55,398
Advisory services fee	4,809		4,575		16,343		14,545
(Gain) loss on legal settlements	—		—		(989)		—
Transaction costs	275		—		571		—
Corporate general and administrative	2,094		1,405		6,077		4,850
Total expenses	115,127		69,222		303,276		242,719
Gain (loss) on insurance settlement and disposition of assets	—		10,149		696		10,149
OPERATING INCOME (LOSS)	1,050		(14,319)		(5,445)		(57,401)
Equity in earnings (loss) of unconsolidated entity	(68)		(58)		(198)		(138)
Interest income	13		12		34		165
Other income (expense)	—		(3,604)		—		(3,806)
Interest expense and amortization of discounts and loan costs	(8,364)		(8,859)		(22,346)		(38,167)
Write-off of loan costs and exit fees	(432)		(1,335)		(1,960)		(3,572)
Unrealized gain (loss) on derivatives	142		3,561		64		3,748
INCOME (LOSS) BEFORE INCOME TAXES	(7,659)		(24,602)		(29,851)		(99,171)
Income tax (expense) benefit	(560)		1,545		(766)		4,622
NET INCOME (LOSS)	(8,219)		(23,057)		(30,617)		(94,549)
(Income) loss attributable to noncontrolling interest in consolidated entities	450		1,999		2,546		4,975
Net (income) loss attributable to redeemable noncontrolling interests in operating partnership	823		2,381		3,184		10,036
NET INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY	(6,946)		(18,677)		(24,887)		(79,538)
Preferred dividends	(1,977)		(2,554)		(6,258)		(7,664)
Gain (loss) on extinguishment of preferred stock	(111)		—		(4,595)		—
NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCKHOLDERS	$	(9,034)	$	(21,231)	$	(35,740)	$	(87,202)
INCOME (LOSS) PER SHARE - BASIC:
Net income (loss) attributable to common stockholders	$	(0.15)	$	(0.63)	$	(0.73)	$	(2.63)
Weighted average common shares outstanding – basic	59,207		33,923		48,954		33,103
INCOME (LOSS) PER SHARE - DILUTED:
Net income (loss) attributable to common stockholders	$	(0.15)	$	(0.63)	$	(0.73)	$	(2.63)
Weighted average common shares outstanding – diluted	59,207		33,923		48,954		33,103

See Notes to Condensed Consolidated Financial Statements.

3

BRAEMAR HOTELS & RESORTS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(unaudited, in thousands)

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
NET INCOME (LOSS)	$	(8,219)	$	(23,057)	$	(30,617)	$	(94,549)
OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX
Total other comprehensive income (loss)	—		—		—		—
TOTAL COMPREHENSIVE INCOME (LOSS)	(8,219)		(23,057)		(30,617)		(94,549)
Comprehensive (income) loss attributable to noncontrolling interest in consolidated entities	450		1,999		2,546		4,975
Comprehensive (income) loss attributable to redeemable noncontrolling interests in operating partnership	823		2,381		3,184		10,036
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY	$	(6,946)	$	(18,677)	$	(24,887)	$	(79,538)

See Notes to Condensed Consolidated Financial Statements.

4

BRAEMAR HOTELS & RESORTS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

(unaudited, in thousands except per share amounts)

	8.25% Series D Cumulative Preferred Stock			Common Stock			Additional Paid-in Capital		Accumulated Deficit		Noncontrolling Interest in Consolidated Entities		Total		5.50% Series B Cumulative Convertible Preferred Stock			Series E Redeemable Preferred Stock			Series M Redeemable Preferred Stock			Redeemable Noncontrolling Interests in Operating Partnership
	Shares	Amount		Shares	Amount										Shares	Amount		Shares	Amount		Shares	Amount
Balance at June 30, 2021	1,600	$	16	57,311	$	573	$	661,576	$	(295,641)	$	(16,264)	$	350,260	3,108	$	66,064	—	—		—	—		$	29,398
Equity-based compensation	—	—		—	—		1,990		—		—		1,990		—	—		—	—		—	—		1,054
Issuance of common stock	—	—		6,550	66		34,166		—				34,232		—	—		—	—		—	—		—
Issuance of common units for hotel acquisition	—	—		—	—		—		—		—		—		—	—		—	—		—	—		13,175
Issuance of preferred stock	—	—		—	—		—		—		—		—		—	—		266	4,204		15	250		—
Dividends declared – preferred stock - Series B ($0.34/share)	—	—		—	—		—		(1,058)		—		(1,058)		—	—		—	—		—	—		—
Dividends declared – preferred stock - Series D ($0.52/share)	—	—		—	—		—		(825)		—		(825)		—	—		—	—		—	—		—
Dividends declared – preferred stock - Series E ($0.50/share)	—	—		—	—		—		(90)		—		(90)		—	—		—	—		—	—		—
Dividends declared – preferred stock - Series M ($0.51/share)	—	—		—	—		—		(4)		—		(4)		—	—		—	—		—	—		—
Net income (loss)	—	—		—	—		—		(6,946)		(450)		(7,396)		—	—		—	—		—	—		(823)
Extinguishment of preferred stock	—	—		120	—		749		(111)		—		638		(30)	(638)		—	—		—	—		—
Redemption value adjustment - preferred stock	—	—		—	—		—		(2,017)		—		(2,017)		—	—		—	1,906			111		—
Redemption value adjustment	—	—		—	—		—		2,856		—		2,856		—	—		—	—		—	—		(2,856)
Balance at September 30, 2021	1,600	$	16	63,974	$	639	$	698,481	$	(303,836)	$	(16,714)	$	378,586	3,078	$	65,426	266	$	6,110	15	$	361	$	39,948

	8.25% Series D Cumulative Preferred Stock			Common Stock			Additional Paid-in Capital		Accumulated Deficit		Noncontrolling Interest in Consolidated Entities		Total		5.50% Series B Cumulative Convertible Preferred Stock			Series E Redeemable Preferred Stock				Series M Redeemable Preferred Stock			Redeemable Noncontrolling Interests in Operating Partnership
	Shares	Amount		Shares	Amount										Shares	Amount		Shares	Amount			Shares	Amount
Balance at December 31, 2020	1,600	$	16	38,275	$	382	$	541,870	$	(266,010)	$	(15,088)	$	261,170	5,031	$	106,949	—	$	—		—	$	—	$	27,655
Purchase of common stock	—	—		(50)	—		(348)		—		—		(348)		—	—		—	—			—	—		—
Equity-based compensation	—	—		—	—		5,015		—		—		5,015		—	—		—	—			—	—		2,250
Issuance of common stock	—	—		17,714	178		99,631		—		—		99,809		—	—		—	—			—	—		—
Issuance of preferred stock	—	—		—	—		—		—		—		—		—	—		266	4,204			15	250		—
Issuance of restricted shares/units	—	—		764	8		(8)		—		—		—		—	—		—	—			—	—		—
Issuance of common units for hotel acquisition	—	—		—	—		—		—		—		—		—	—		—	—			—	—		13,175
Forfeiture of restricted common shares	—	—		(22)	—		—		—		—		—		—	—		—	—			—	—		—
Dividends declared – preferred stock - Series B ($1.03/share)	—	—		—	—		—		(3,689)		—		(3,689)		—	—		—	—			—	—		—
Dividends declared – preferred stock - Series D ($1.55/share)	—	—		—	—		—		(2,475)		—		(2,475)		—	—		—	—			—	—		—
Dividends declared – preferred stock - Series E ($0.50/share)	—	—		—	—		—		(90)		—		(90)		—	—		—	—			—	—		—
Dividends declared – preferred stock - Series M (0.51/share)	—	—		—	—		—		(4)		—		(4)		—	—		—	—			—	—		—
Contributions from noncontrolling interests	—	—		—	—		—		—		920		920		—	—		—	—			—	—		—
Redemption/conversion of operating partnership units	—	—		2	—		17		—		—		17		—	—		—	—			—	—		(17)
Net income (loss)	—	—		—	—		—		(24,887)		(2,546)		(27,433)		—	—		—	—			—	—		(3,184)
Extinguishment of preferred stock	—	—		7,291	71		46,047		(4,595)		—		41,523		(1,953)	(41,523)		—	—			—	—		—
Equity component of Convertible Senior Notes	—	—		—	—		6,257		—		—		6,257		—	—		—	—			—	—		—
Redemption value adjustment - preferred stock	—	—		—	—		—		(2,017)		—		(2,017)		—	—		—	1,906			—	111		—
Redemption value adjustment	—	—		—	—		—		(69)		—		(69)		—	—		—	—			—	—		69
Balance at September 30, 2021	1,600	$	16	63,974	$	639	$	698,481	$	(303,836)	$	(16,714)	$	378,586	3,078	$	65,426	266	$	6,110	$0	15	$	361	39,948

5

	8.25% Series D Cumulative Preferred Stock			Common Stock			Additional Paid-in Capital		Accumulated Deficit		Noncontrolling Interest in Consolidated Entities		Total		5.50% Series B Cumulative Convertible  Preferred Stock			Redeemable Noncontrolling Interests in Operating Partnership
	Shares	Amount		Shares	Amount										Shares	Amount
Balance at June 30, 2020	1,600	$	16	33,528	$	335	$	525,846	$	(216,574)	$	(11,628)	$	297,995	5,031	$	107,352	$	31,589
Purchase of common stock	—	—		(1)	—		(2)		—		—		(2)		—	—		—
Equity-based compensation	—	—		—	—		1,465		—		—		1,465		—	—		541
Issuance of common stock	—	—		3,046	30		6,380		—		—		6,410		—	—		—
Issuance of restricted shares/units	—	—		29	—		(48)		—		—		(48)		—	—		(44)
Forfeiture of restricted common shares	—	—		(2)	—		—		—		—		—		—	—		—
Dividends declared – preferred stock - Series B ($0.34/share)	—	—		—	—		—		(1,729)		—		(1,729)		—	—		—
Dividends declared – preferred stock-Series D ($0.52/share)	—	—		—	—		—		(825)		—		(825)		—	—		—
Net income (loss)	—	—		—	—		—		(18,677)		(1,999)		(20,676)		—	—		(2,381)
Redemption value adjustment	—	—		—	—		—		(8)		—		(8)		—	—		8
Balance at September 30, 2020	1,600	$	16	36,600	$	365	$	533,641	$	(237,813)	$	(13,627)	$	282,582	5,031	$	107,352	$	29,713

	8.25% Series D Cumulative Preferred Stock			Common Stock			Additional Paid-in Capital		Accumulated Deficit		Noncontrolling Interest in Consolidated Entities		Total		5.50% Series B Cumulative Convertible Preferred Stock			Redeemable Noncontrolling Interests in Operating Partnership
	Shares	Amount		Shares	Amount										Shares	Amount
Balance at December 31, 2019	1,600	$	16	32,885	$	329	$	519,551	$	(150,629)	$	(6,013)	$	363,254	5,008	$	106,920	$	41,570
Purchase of common stock	—	—		(36)	—		(126)		—		—		(126)		—	—		—
Equity-based compensation	—	—		—	—		4,388		—		—		4,388		—	—		1,651
Issuance of common stock	—	—		3,046	30		6,380		—		—		6,410		—	—		—
Issuance of preferred stock	—	—		—	—		—		—		—		—		23	432		—
Issuance of restricted shares/units	—	—		375	3		(3)		—		—		—		—	—		—
Forfeiture of restricted common shares	—	—		(9)	—		—		—		—		—		—	—		—
Dividends declared – preferred stock - Series B ($1.03/share)	—	—		—	—		—		(5,189)		—		(5,189)		—	—		—
Dividends declared – preferred stock-Series D ($1.55/share)	—	—		—	—		—		(2,475)		—		(2,475)		—	—		—
Distributions to noncontrolling interests	—	—		—	—		—		—		(2,639)		(2,639)		—	—		—
Redemption/conversion of operating partnership units	—	—		339	3		3,451		—		—		3,454		—	—		(3,454)
Net income (loss)	—	—		—	—		—		(79,538)		(4,975)		(84,513)		—	—		(10,036)
Redemption value adjustment	—	—		—	—		—		18		—		18		—	—		(18)
Balance at September 30, 2020	1,600	$	16	36,600	$	365	$	533,641	$	(237,813)	$	(13,627)	$	282,582	5,031	$	107,352	$	29,713

See Notes to Condensed Consolidated Financial Statements.

6

BRAEMAR HOTELS & RESORTS INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited, in thousands)

	Nine Months Ended September 30,
	2021		2020
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss)	$	(30,617)	$	(94,549)
Adjustments to reconcile net income (loss) to net cash flows provided by (used in) operating activities:
Depreciation and amortization	54,881		55,398
Equity-based compensation	7,265		6,039
Bad debt expense	208		574
Amortization of loan costs, discounts and capitalized default interest	(550)		1,458
Write-off of loan costs and exit fees	1,960		3,572
Amortization of intangibles	394		621
Amortization of non-refundable membership initiation fees	(715)		(285)
Interest expense accretion on refundable membership club deposits	582		616
(Gain) loss on insurance settlement and disposition of assets	(696)		(10,149)
Realized and unrealized (gain) loss on derivatives	(64)		(133)
Net settlement of trading derivatives	—		30
Equity in (earnings) loss of unconsolidated entity	198		138
Deferred income tax expense (benefit)	(174)		(844)
Changes in operating assets and liabilities, exclusive of the effect of hotel acquisition:
Accounts receivable and inventories	(4,079)		7,271
Prepaid expenses and other assets	311		(67)
Accounts payable and accrued expenses	31,131		(7,912)
Operating lease right-of-use assets	416		387
Due to/from related parties, net	(919)		(442)
Due to/from third-party hotel managers	(7,365)		2,077
Due to/from Ashford Inc.	409		(802)
Operating lease liabilities	(184)		(162)
Other liabilities	2,755		1,535
Net cash provided by (used in) operating activities	55,147		(35,629)
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from property insurance	—		2,528
Net proceeds from disposition of assets	1,816		—
Acquisition of hotel property, net of cash and restricted cash acquired	(9,515)		—
Investment in unconsolidated entity	(117)		(26)
Improvements and additions to hotel properties	(15,849)		(21,451)
Net cash provided by (used in) investing activities	(23,665)		(18,949)
CASH FLOWS FROM FINANCING ACTIVITIES
Borrowings on indebtedness	83,231		109,317
Repayments of indebtedness	(83,770)		(46,033)
Payments of loan costs and exit fees	(1,895)		(6,478)
Payments for derivatives	(200)		(92)
Purchase of common stock	(376)		(260)
Payments for dividends and distributions	(6,882)		(13,599)
Proceeds from issuance of preferred stock	4,586		474
Proceeds from issuance of common stock	100,024		6,390
Contributions from noncontrolling interest in consolidated entities	920		—
Distributions to noncontrolling interest in consolidated entities	—		(2,639)
Net cash provided by (used in) financing activities	95,638		47,080
Net change in cash, cash equivalents and restricted cash	127,120		(7,498)
Cash, cash equivalents and restricted cash at beginning of period	113,150		130,383
Cash, cash equivalents and restricted cash at end of period	$	240,270	$	122,885
SUPPLEMENTAL CASH FLOW INFORMATION
Interest paid	$	22,268	$	20,969
Income taxes paid (refunded)	(20)		898

7

	Nine Months Ended September 30,
	2021		2020
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES
Dividends and distributions declared but not paid	$	2,112	$	3,208
Common stock purchases accrued but not paid	—		2
Issuance of units for hotel acquisition	13,175		—
Issuance of warrants in hotel acquisition	1,528		—
Assumption of debt in hotel acquisition	49,815		—
Capital expenditures accrued but not paid	2,094		7,380
Accrued but unpaid financing costs	—		2,229
Non-cash loan principal associated with default interest and late charges	—		9,859
Accrued common stock offering expense	147		223
Unsettled common stock offering proceeds	—		243
Accrued preferred stock offering expenses	132		—
SUPPLEMENTAL DISCLOSURE OF CASH, CASH EQUIVALENTS AND RESTRICTED CASH
Cash and cash equivalents at beginning of period	$	78,606	$	71,995
Restricted cash at beginning of period	34,544		58,388
Cash, cash equivalents and restricted cash at beginning of period	$	113,150	$	130,383
Cash and cash equivalents at end of period	$	195,517	$	88,227
Restricted cash at end of period	44,753		34,658
Cash, cash equivalents and restricted cash at end of period	$	240,270	$	122,885

See Notes to Condensed Consolidated Financial Statements.

8

BRAEMAR HOTELS & RESORTS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

1. Organization and Description of Business

Braemar Hotels & Resorts Inc., together with its subsidiaries (“Braemar”), is a Maryland corporation that invests primarily in high revenue per available room (“RevPAR”) luxury hotels and resorts. High RevPAR, for purposes of our investment strategy, means RevPAR of at least twice the then-current U.S. national average RevPAR for all hotels as determined by Smith Travel Research. Braemar has elected to be taxed as a real estate investment trust (“REIT”) under the Internal Revenue Code of 1986, as amended (the “Code”). Braemar conducts its business and owns substantially all of its assets through its operating partnership, Braemar Hospitality Limited Partnership (“Braemar OP”). In this report, the terms “Company,” “we,” “us” or “our” refers to Braemar Hotels & Resorts Inc. and, as the context may require, all entities included in its condensed consolidated financial statements.

We are advised by Ashford Hospitality Advisors LLC (“Ashford LLC” or the “Advisor”) through an advisory agreement. Ashford LLC is a subsidiary of Ashford Inc. All of the hotel properties in our portfolio are currently asset-managed by Ashford LLC. We do not have any employees. All of the services that might be provided by employees are provided to us by Ashford LLC.

We do not operate any of our hotel properties directly; instead we employ hotel management companies to operate them for us under management contracts. Remington Hotels, a subsidiary of Ashford Inc., manages four of our 14 hotel properties. Third-party management companies manage the remaining hotel properties.

Ashford Inc. also provides other products and services to us or our hotel properties through certain entities in which Ashford Inc. has an ownership interest. These products and services include, but are not limited to design and construction services, debt placement and related services, broker-dealer and distribution services, audio visual services, real estate advisory services, insurance claims services, hypoallergenic premium rooms, watersport activities, travel/transportation services and mobile key technology.

The accompanying condensed consolidated financial statements include the accounts of wholly-owned and majority-owned subsidiaries of Braemar OP that as of September 30, 2021, own 14 hotel properties in six states, the District of Columbia and the U.S. Virgin Islands (“USVI”). The portfolio includes 12 wholly-owned hotel properties and two hotel properties that are owned through a partnership in which Braemar OP has a controlling interest. These hotel properties represent 3,865 total rooms, or 3,630 net rooms, excluding those attributable to our partner. As a REIT, Braemar is required to comply with limitations imposed by the Code related to operating hotels. As of September 30, 2021, 13 of our 14 hotel properties were leased by wholly-owned or majority-owned subsidiaries that are treated as taxable REIT subsidiaries (“TRS”) for federal income tax purposes (collectively the TRS entities are referred to as “Braemar TRS”). One hotel property, located in the USVI, is owned by our USVI TRS. Braemar TRS then engages third-party or affiliated hotel management companies to operate the hotel properties under management contracts. Hotel operating results related to the hotel properties are included in the condensed consolidated statements of operations.

As of September 30, 2021, 11 of the 14 hotel properties were leased by Braemar’s wholly-owned TRS, and the two hotel properties majority-owned through a consolidated partnership were leased to a TRS wholly-owned by such consolidated partnership. Each leased hotel is leased under a percentage lease that provides for each lessee to pay in each calendar month the base rent plus, in each calendar quarter, percentage rent, if any, based on hotel revenues. Lease revenue from Braemar TRS is eliminated in consolidation. The hotel properties are operated under management contracts with Marriott Hotel Services, Inc. (“Marriott”), Hilton Management LLC (“Hilton”), Accor Management US Inc. (“Accor”), Hyatt Corporation (“Hyatt”), Ritz-Carlton (Virgin Islands), Inc. and The Ritz-Carlton Hotel Company, L.L.C., each of which is an affiliate of Marriott (“Ritz-Carlton”) and Remington Hotels, which are eligible independent contractors under the Code.

Liquidity

In December 2019, COVID-19 was identified in Wuhan, China, subsequently spread to other regions of the world, and has resulted in significant travel restrictions and extended shutdown of numerous businesses throughout the United States. In March 2020, the World Health Organization declared COVID-19 to be a global pandemic. Beginning in late February 2020, we experienced a significant decline in occupancy and RevPAR associated with COVID-19 as we experienced significant reservation cancellations as well as a significant reduction in new reservations. The prolonged presence of the virus has resulted in health and other government authorities imposing widespread restrictions on travel and other businesses.

9

BRAEMAR HOTELS & RESORTS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

As of September 30, 2021, the Company maintained unrestricted cash of $195.5 million and restricted cash of $44.8 million. The vast majority of the restricted cash comprises lender and manager held reserves. As of September 30, 2021, there was also $20.4 million due to the Company from third-party hotel managers, which is primarily the Company’s cash held by one of its property managers which is also available to fund hotel operating costs. On December 10, 2020, the Company announced that it plans to continue its suspension of the common stock dividend into 2021 to protect liquidity and will evaluate future dividend declarations on a quarterly basis going forward.

We cannot predict when hotel operating levels will return to normalized levels after the effects of the pandemic fully subside, whether our hotels will be forced to shut down operations or whether one or more possible recurrences of COVID-19 case surges could result in further reductions in business and personal travel or potentially cause state and local governments to reinstate travel restrictions. Facts and circumstances could change in the future that are outside of management’s control, such as additional government mandates, health official orders, travel restrictions and extended business shutdowns due to COVID-19.

2. Significant Accounting Policies

Basis of Presentation and Principles of Consolidation—The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. These condensed consolidated financial statements include the accounts of Braemar Hotels & Resorts Inc., its majority-owned subsidiaries, and its majority-owned entities in which it has a controlling interest. All significant intercompany accounts and transactions between consolidated entities have been eliminated in these condensed consolidated financial statements. We have condensed or omitted certain information and footnote disclosures normally included in financial statements presented in accordance with GAAP in the accompanying unaudited condensed consolidated financial statements. We believe the disclosures made herein are adequate to prevent the information presented from being misleading. However, the financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our 2020 Annual Report on Form 10-K, as originally filed with the Securities and Exchange Commission (“SEC”) on March 5, 2021.

Braemar OP is considered to be a variable interest entity (“VIE”), as defined by authoritative accounting guidance. A VIE must be consolidated by a reporting entity if the reporting entity is the primary beneficiary because it has (i) the power to direct the VIE’s activities that most significantly impact the VIE’s economic performance and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE. All major decisions related to Braemar OP that most significantly impact its economic performance, including but not limited to operating procedures with respect to business affairs and any acquisitions, dispositions, financings, restructurings or other transactions with sellers, purchasers, lenders, brokers, agents and other applicable representatives, are subject to the approval of our wholly-owned subsidiary, Braemar OP General Partner LLC, its general partner. As such, we consolidate Braemar OP.

The following items affect reporting comparability of our historical condensed consolidated financial statements:

•historical seasonality patterns at some of our hotel properties cause fluctuations in our overall operating results. Consequently, operating results for the three and nine months ended September 30, 2021, are not necessarily indicative of the results that may be expected for the year ending December 31, 2021.

•on August 5, 2021, we acquired the Mr. C Beverly Hills Hotel and five adjacent luxury residences. The operating results of the hotel property have been included in the results of operations from its acquisition date.

Use of Estimates—The preparation of these condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Recently Adopted Accounting Standards—In January 2020, the Financial Accounting Standards Board’s (“FASB”) issued Accounting Standards Update (“ASU”) 2020-01, Investments – Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815) – Clarifying the Interactions between Topic 321, Topic 323, and Topic 815 (a consensus of the Emerging Issues Task Force) (“ASU 2020-01”), which clarifies the interaction between the accounting for equity securities, equity method investments, and certain derivative instruments. The ASU, among other

10

BRAEMAR HOTELS & RESORTS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

things, clarifies that a company should consider observable transactions that require a company to either apply or discontinue the equity method of accounting under Topic 323, Investments—Equity Method and Joint Ventures, for the purposes of applying the measurement alternative in accordance with Topic 321 immediately before applying or upon discontinuing the equity method. ASU 2020-01 is effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years and should be applied prospectively. Early adoption is permitted. We adopted the standard effective January 1, 2021 and the adoption of this standard did not have a material impact on our consolidated financial statements.

Recently Issued Accounting Standards—In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848) (“ASU 2020-04”). ASU 2020-04 contains practical expedients for reference rate reform related activities that impact debt, leases, derivatives and other contracts. The guidance in ASU 2020-04 is optional and may be elected over time as reference rate reform activities occur. In January 2021, the FASB issued ASU 2021-01, Reference Rate Reform (Topic 848): Scope (“ASU 2021-01”) to provide guidance and relief for transitioning to alternative reference rates. ASU 2021-01 is effective immediately for all entities. The Company continues to evaluate the impact of the guidance and may apply the elections as applicable as changes in the market occur.

In August 2020, the FASB issued ASU 2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (“ASU 2020-06”), which simplifies the accounting for certain financial instruments with characteristics of liabilities and equity. This ASU: (1) simplifies the accounting for convertible debt instruments and convertible preferred stock by removing the existing guidance in Accounting Standards Codification (“ASC”) 470-20, Debt: Debt with Conversion and Other Options, that requires entities to account for beneficial conversion features and cash conversion features in equity, separately from the host convertible debt or preferred stock; (2) revises the scope exception from derivative accounting in ASC 815-40 for freestanding financial instruments and embedded features that are both indexed to the issuer’s own stock and classified in stockholders’ equity, by removing certain criteria required for equity classification; and (3) revises the guidance in ASC 260, Earnings Per Share, to require entities to calculate diluted earnings per share (“EPS”) for convertible instruments by using the if-converted method. In addition, entities must presume share settlement for purposes of calculating diluted EPS when an instrument may be settled in cash or shares. For SEC filers, excluding smaller reporting companies, this ASU is effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020. Entities should adopt the guidance as of the beginning of the fiscal year of adoption and cannot adopt the guidance in an interim reporting period. We are currently evaluating the impact that ASU 2020-06 may have on our consolidated financial statements and related disclosures.

11

BRAEMAR HOTELS & RESORTS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

3. Revenue

The following tables present our revenue disaggregated by geographical areas (dollars in thousands):

	Three Months Ended September 30, 2021
Primary Geographical Market	Number of Hotels	Rooms		Food and Beverage		Other Hotel		Total
California	6	$	28,838	$	8,024	$	3,626	$	40,488
Colorado	1	4,123		4,152		2,168		10,443
Florida	2	13,738		5,384		4,581		23,703
Illinois	1	5,233		1,196		389		6,818
Pennsylvania	1	3,911		580		243		4,734
Washington	1	6,906		792		550		8,248
Washington, D.C.	1	2,476		512		337		3,325
USVI	1	12,335		3,854		2,229		18,418
Total	14	$	77,560	$	24,494	$	14,123	$	116,177

	Three Months Ended September 30, 2020
Primary Geographical Market	Number of Hotels	Rooms		Food and Beverage		Other Hotel		Total
California	5	$	11,504	$	2,895	$	1,536	$	15,935
Colorado	1	1,688		692		1,659		4,039
Florida	2	7,103		3,175		3,262		13,540
Illinois	1	1,706		240		127		2,073
Pennsylvania	1	1,088		9		58		1,155
Washington	1	1,056		3		118		1,177
Washington, D.C.	1	331		4		292		627
USVI	1	3,642		1,519		1,047		6,208
Total	13	$	28,118	$	8,537	$	8,099	$	44,754

	Nine Months Ended September 30, 2021
Primary Geographical Market	Number of Hotels	Rooms		Food and Beverage		Other Hotel		Total
California	6	$	60,935	$	17,942	$	8,607	$	87,484
Colorado	1	12,058		8,344		6,058		26,460
Florida	2	47,964		18,732		15,311		82,007
Illinois	1	9,607		2,020		792		12,419
Pennsylvania	1	7,568		706		490		8,764
Washington	1	10,980		1,041		1,046		13,067
Washington, D.C.	1	5,711		767		832		7,310
USVI	1	40,897		11,424		7,303		59,624
Total	14	$	195,720	$	60,976	$	40,439	$	297,135

	Nine Months Ended September 30, 2020
Primary Geographical Market	Number of Hotels	Rooms		Food and Beverage		Other Hotel		Total
California	5	$	37,401	$	10,936	$	6,474	$	54,811
Colorado	1	9,955		4,974		4,898		19,827
Florida	2	24,401		12,535		10,292		47,228
Illinois	1	4,638		1,129		490		6,257
Pennsylvania	1	6,088		1,215		377		7,680
Washington	1	4,821		794		540		6,155
Washington, D.C.	1	6,857		3,482		1,174		11,513
USVI	1	10,958		4,352		6,388		21,698
Total	13	$	105,119	$	39,417	$	30,633	$	175,169

12

BRAEMAR HOTELS & RESORTS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

For the three and nine months ended September 30, 2020, the Company recorded revenue from business interruption losses associated with lost profits from Hurricane Irma of $0 and $4.0 million, respectively. This revenue is included in “other” hotel revenue in our condensed consolidated statement of operations. There was no such revenue recorded for the three and nine months ended September 30, 2021 as the insurance claim was fully settled in 2020.

4. Investments in Hotel Properties, net

Investments in hotel properties, net consisted of the following (in thousands):

	September 30, 2021		December 31, 2020
Land	$	480,530	$	455,298
Buildings and improvements	1,222,422		1,190,437
Furniture, fixtures and equipment	122,921		127,692
Construction in progress	9,136		11,422
Residences	12,746		—
Total cost	1,847,755		1,784,849
Accumulated depreciation	(395,753)		(360,259)
Investments in hotel properties, net	$	1,452,002	$	1,424,590

Impairment Charges and Insurance Recoveries

For the three and nine months ended September 30, 2021, we recognized a gain of $0 and $481,000, respectively. associated with proceeds received from an insurance claim.

For the three and nine months ended September 30, 2020, the Company received proceeds of $650,000 and $8.0 million, respectively, from our insurance carriers for property damage and business interruption from Hurricane Irma. There were no proceeds for the three and nine months ended September 30, 2021 as the claim was fully settled in September 2020.

During the three and nine months ended September 30, 2021 and 2020, no impairment charges were recorded.

In September 2020, the Company reached a final settlement with its insurance carriers related to Hurricane Irma. Upon settlement, the Company recorded a gain of $10.1 million as the proceeds received exceeded the carrying value of the hotel property at the time of the loss.

Mr. C Beverly Hills Hotel

On August 5, 2021, the Company acquired a 100% interest in the 138-room Mr. C Beverly Hills Hotel and five luxury residences adjacent to the hotel. The total consideration consisted of $10.0 million of cash, 2.5 million Braemar OP common units with a fair value of approximately $13.2 million and 500,000 warrants for the purchase of Braemar common stock with a $6.00 strike price and a fair value of approximately $1.5 million. Additionally the Company assumed a $50.0 million mortgage loan, with a fair value of approximately $49.8 million. Upon closing, the Company repaid $20.0 million of the assumed mortgage loan. See notes 6, 7 and 11 for further discussion regarding the mortgage loan, common units and warrants.

The acquisition of the Mr. C Beverly Hills Hotel included the hotel and the adjacent luxury residences (the “residences”). We have accounted for the transaction as a business combination under Accounting Standards Codification (“ASC”) 805- Business Combinations. We are in the process of evaluating the values assigned to investment in hotel property, property level working capital balances and the residences. This valuation is considered a Level 3 valuation technique. Thus, the balances reflected below are subject to change, and any such changes could result in adjustments to the allocation. Any change to the amounts recorded within the investments in hotel properties will also impact depreciation and amortization expense.

13

BRAEMAR HOTELS & RESORTS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

The following table summarizes the preliminary estimated fair value of the assets acquired and liabilities assumed in the acquisition (in thousands):

Land	$	25,232
Buildings and improvements	35,689
Furniture, fixtures and equipment	758
Residences	12,746
Investments in hotel properties	74,425
Inventories	94
Mortgage loan	(49,815)
	$	24,704
Net other assets (liabilities)	$	(486)

The results of operations of the hotel property have been included in our results of operations as of the acquisition date. The table below summarizes the total revenue and net income (loss) in our condensed consolidated statements of operations for the three and nine months ended September 30, 2021:

	Three Months Ended September 30, 2021		Nine Months Ended September 30, 2021
Total revenue	$	2,272	$	2,272
Net income (loss)	(1,203)		(1,203)

Pro Forma Financial Results

The following table reflects the unaudited pro forma results of operations as if the acquisitions had occurred and the applicable indebtedness was incurred on January 1, 2020, and the removal of $275,000 and $571,000 of non-recurring transaction costs directly attributable to the acquisition for the three and nine months ended September 30, 2021 (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Total revenue	$	117,808	$	46,409	$	303,406	$	181,121
Net income (loss)	$	(7,114)	$	(23,939)	$	(30,418)	$	(97,449)
Net income (loss) attributable to common stockholders	$	(7,898)	$	(20,675)	$	(34,082)	$	(84,203)
Pro Forma income per share;
Basic	$	(0.13)	$	(0.61)	$	(0.70)	$	(2.54)
Diluted	$	(0.13)	$	(0.61)	$	(0.70)	$	(2.54)
Weighted average common shares outstanding (in thousands):
Basic	59,207		33,923		48,954		33,103
Diluted	59,207		33,923		48,954		33,103

5. Investment in Unconsolidated Entity

OpenKey is a hospitality-focused mobile key platform that provides a universal smart phone app and related hardware and software for keyless entry into hotel guest rooms. In 2018, the Company made an initial investment in OpenKey, which is controlled and consolidated by Ashford Inc., for an initial 8.2% ownership interest. On July 12, 2021, the Company made an additional investment in OpenKey of approximately $117,000. All investments were recommended by our Related Party Transactions Committee and unanimously approved by the independent members of our board of directors. As of September 30, 2021, the Company has made investments in OpenKey totaling $2.5 million.

Our investment is recorded as “investment in unconsolidated entity” in our condensed consolidated balance sheets and is accounted for under the equity method of accounting as we have significant influence over the entity under the applicable accounting guidance. We review our investment in OpenKey for impairment in each reporting period pursuant to the applicable authoritative accounting guidance. An investment is impaired when its estimated fair value is less than the carrying amount of

14

BRAEMAR HOTELS & RESORTS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

the investment. Any impairment is recorded in equity in earnings (loss) of unconsolidated entity. No such impairment was recorded for the three and nine months ended September 30, 2021 and 2020.

The following table summarizes our carrying value and ownership interest in OpenKey:

	September 30, 2021			December 31, 2020
Carrying value of the investment in OpenKey (in thousands)	$	1,627		$	1,708
Ownership interest in OpenKey	7.8		%	8.2		%

The following table summarizes our equity in earnings (loss) in OpenKey (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
Line Item	2021		2020		2021		2020
Equity in earnings (loss) of unconsolidated entity	$	(68)	$	(58)	$	(198)	$	(138)

6. Indebtedness, net

Indebtedness, net consisted of the following (dollars in thousands):

Indebtedness	Collateral	Current Maturity	Final Maturity (12)	Interest Rate	September 30, 2021		December 31, 2020
Mortgage loan (3)	Park Hyatt Beaver Creek Resort & Spa	April 2022	April 2022	LIBOR (1) +3.00%	$	67,500	$	67,500
Mortgage loan (4)	The Notary Hotel	June 2022	June 2025	LIBOR (1) + 2.16%	435,000		435,000
	The Clancy
	Sofitel Chicago Magnificent Mile
	Marriott Seattle Waterfront
Mortgage loan (5)	The Ritz-Carlton St. Thomas	August 2022	August 2024	LIBOR (1) + 3.95%	42,500		42,500
Term loan (6)	Equity	October 2022	October 2022	Base Rate (2) + 1.25% to 2.65% or LIBOR (1) + 2.25% to 3.65%	—		61,495
Mortgage loan (7)	The Ritz-Carlton Sarasota	April 2023	April 2023	LIBOR (1) + 2.65%	99,750		100,000
Mortgage loan (7) (8)	Hotel Yountville	May 2023	May 2023	LIBOR (1) + 2.55%	51,000		51,000
Mortgage loan (7) (8)	Bardessono Hotel and Spa	August 2023	August 2023	LIBOR (1) + 2.55%	40,000		40,000
Mortgage loan (7)	The Ritz-Carlton Lake Tahoe	January 2024	January 2024	LIBOR (1) + 2.10%	54,000		54,000
Mortgage loan (9)	Capital Hilton	February 2024	February 2024	LIBOR (1) + 1.70%	195,203		197,229
	Hilton La Jolla Torrey Pines
Mortgage loan (10)	Mr. C Beverly Hills Hotel	August 2024	August 2024	LIBOR (1) + 3.60%	30,000		—
Mortgage loan (7)	Pier House Resort & Spa	September 2024	September 2024	LIBOR (1) + 1.85%	80,000		80,000
Convertible Senior Notes (11)	Equity	June 2026	June 2026	4.50%	86,250		—
					1,181,203		1,128,724
Capitalized default interest and late charges					4,425		7,304
Deferred loan costs, net					(3,997)		(5,434)
Discounts, net					(8,844)		—
Indebtedness, net					$	1,172,787	$	1,130,594

__________________

(1)LIBOR rates were 0.080% and 0.144% at September 30, 2021 and December 31, 2020, respectively.

(2)Base Rate, as defined in the secured term loan agreement, is the greater of (i) the prime rate set by Bank of America, or (ii) federal funds rate + 0.5%, or (iii) LIBOR + 1.0%.

(3)Effective January 9, 2021, we amended this mortgage loan. Terms of the agreement included monthly FF&E escrow deposits being waived from January 2021 through June 2021. This mortgage loan has three one-year extension options, subject to satisfaction of certain conditions, of which the third was exercised in April 2021.

(4)This mortgage loan has five one-year extension options, subject to satisfaction of certain conditions, of which the second was exercised in June 2021.

(5)This mortgage loan has three one-year extension options, subject to satisfaction of certain conditions, of which the first was exercised in August 2021. This mortgage loan has a LIBOR floor of 1.00%.

(6)Effective February 22, 2021, we amended this term loan. In conjunction with the amendment, the interest rate spread increased from a rate of Base Rate + 1.25% - 2.50% or LIBOR + 2.25% - 3.50% to a Base Rate + 1.25% - 2.65% or LIBOR + 2.25% - 3.65%, with a LIBOR floor of 0.50%. On May 18, 2021, we repaid this term loan in full.

15

BRAEMAR HOTELS & RESORTS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

(7)Effective December 31, 2020, we amended this mortgage loan. Terms of the agreement included monthly FF&E escrow deposits being waived from January 2021 through December 2021. This mortgage loan has a LIBOR floor of 0.25%.

(8)On September 23, 2021, we amended this mortgage loan. Terms of the agreement included extending the current and final maturity dates by one year.

(9)Effective March 5, 2021, we amended this mortgage loan. Terms of the agreement included monthly FF&E escrow deposits waived through July 1, 2021.

(10)This mortgage loan has a LIBOR floor of 1.50%.

(11)On May 18, 2021, we executed a purchase agreement to sell convertible senior notes in a private offering. In conjunction with the private offering, we sold convertible senior notes with an aggregate principal amount of $86.25 million.

(12)The final maturity date assumes all available extensions options will be exercised.

During the second and third quarters of 2020, we reached forbearance and other agreements with our lenders relating to loans secured by the Pier House Resort & Spa, The Ritz-Carlton Sarasota, The Ritz-Carlton Lake Tahoe, Hotel Yountville, Bardessono Hotel and Spa, Sofitel Chicago Magnificent Mile, The Notary Hotel, The Clancy, Marriott Seattle Waterfront, Capital Hilton and Hilton La Jolla Torrey Pines. As of September 30, 2021, no loans are in default. See note 14 for discussion of the loan modification agreement with Lismore Capital LLC (“Lismore”). The Company determined that all of the forbearance and other agreements evaluated were considered troubled debt restructurings due to terms that allowed for deferred interest and the forgiveness of default interest and late charges. No gain or loss was recognized during 2020, as the carrying amount of the original loans was not greater than the undiscounted cash flows of the modified loans. Additionally, as a result of the troubled debt restructurings all accrued default interest and late charges were capitalized into the applicable loan balances and are being amortized over the remaining term of the loans using the effective interest method. The amount of non-cash principal amortization associated with the default interest and late charges during the three and nine months ended September 30, 2021 was approximately $519,000 and $2.9 million, respectively. The amount of principal amortization during the three and nine months ended September 30, 2020 was $937,000 and $1.2 million, respectively.

On August 5, 2021, in connection with the acquisition of the Mr. C Beverly Hills Hotel and the adjacent residences in Los Angeles, California, the Company assumed a $50 million mortgage loan and repaid $20 million upon closing. This mortgage loan provides for an interest rate of LIBOR + 3.60%. The mortgage loan is interest only with the stated maturity in August 2024.

Convertible Senior Notes

In May 2021, the Company issued $86.25 million aggregate principal amount of 4.50% Convertible Senior Notes due June 2026 (the “Convertible Senior Notes”). The net proceeds from this offering of the Convertible Senior Notes were approximately $82.8 million after deducting the underwriting fees and other expenses paid by the Company. A portion of the proceeds were used to fully repay the secured term loan.

The Convertible Senior Notes are governed by an indenture (the “Base Indenture”) between the Company and U.S. Bank National Association, as trustee. The Convertible Senior Notes bear interest at a rate of 4.50% per annum, payable semi-annually in arrears on June 1 and December 1 of each year, beginning on December 1, 2021. The Convertible Senior Notes will mature on June 1, 2026. The Company recorded coupon interest expense of $970,000 and $1.4 million, respectively, for the three and nine months ended September 30, 2021.

The Company separated the Convertible Senior Notes into liability and equity components. The initial carrying amount of the liability component was calculated using a discount rate of 7.1%. The discount rate was based on the terms of debt instruments that were similar to the Convertible Senior Notes. The $6.3 million carrying amount of the equity component representing the conversion option was determined by deducting the fair value of the liability component from the net proceeds of the Convertible Senior Notes. The amount recorded in equity is not subject to remeasurement or amortization. The initial discount of $9.3 million is accreted to interest expense using the effective interest rate method over the contractual term of the Convertible Senior Notes. The Company recorded discount amortization of $391,000 and $576,000, respectively, for the three and nine months ended September 30, 2021.

The Convertible Senior Notes are convertible at any time prior to the close of business on the business day immediately preceding the maturity date for cash, shares of the Company’s common stock or a combination of cash and shares of the Company’s common stock, at the election of the Company, based on an initial conversion rate of 157.7909 shares of the Company’s common stock per $1,000 principal amount of notes (equivalent to a conversion price of approximately $6.34 per share of common stock), subject to adjustment of the conversion rate under certain circumstances. In addition, following the occurrence of certain corporate events, if the Company provides notice of redemption or if it exercises its option to convert the Convertible Senior Notes, the Company will, in certain circumstances, increase the conversion rate for a holder that converts its

16

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

Convertible Senior Notes in connection with such corporate event, such notice of redemption, or such issuer conversion option, as the case may be.

The Company may redeem the Convertible Senior Notes at the Company’s option, in whole or in part, on any business day on or after the date of issuance if the last reported sale price per share of the Company’s common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which the Company provides a notice of redemption at a redemption price equal to 100% of the principal amount of the Convertible Senior Notes to be redeemed subject to certain adjustments, plus accrued and unpaid interest to, but excluding, the redemption date.

If we violate covenants in any debt agreement, we could be required to repay all or a portion of our indebtedness before maturity at a time when we might be unable to arrange financing for such repayment on attractive terms, if at all. The assets of certain of our subsidiaries are pledged under non-recourse indebtedness and are not available to satisfy the debts and other obligations of the consolidated group. As of September 30, 2021, we were in compliance with all covenants.

7. Derivative Instruments

Interest Rate Derivatives—We are exposed to risks arising from our business operations, economic conditions and financial markets. To manage these risks, we primarily use interest rate derivatives to hedge our debt and our cash flows. The interest rate derivatives include interest rate caps and interest rate floors, which are subject to master netting settlement arrangements. All derivatives are recorded at fair value.

The following table summarizes the interest rate derivatives we entered into over the applicable periods:

	Nine Months Ended September 30,
Interest rate caps:(1)	2021			2020
Notional amount (in thousands)	$	882,500		$	602,500
Strike rate low end of range	0.75		%	3.00		%
Strike rate high end of range	4.00		%	4.00		%
Effective date range	January 2021- September 2021			March 2020 - June 2020
Termination date range	February 2022- August 2024			April 2021 - June 2021
Total cost of interest rate caps (in thousands)	$	200		$	92

_______________

(1)    No instruments were designated as cash flow hedges.

Interest rate derivatives consisted of the following:

Interest rate caps: (1)	September 30, 2021			December 31, 2020
Notional amount (in thousands)	$	962,500		$	779,000
Strike rate low end of range	0.75		%	3.00		%
Strike rate high end of range	4.00		%	4.00		%
Termination date range	October 2021 - August 2024			February 2021 - October 2021
Aggregate principal balance on corresponding mortgage loans (in thousands)	$	857,250		$	779,000

_______________

(1)No instruments were designated as cash flow hedges.

Warrants—On August 5, 2021, as part of the consideration paid to acquire the Mr. C Beverly Hills Hotel and five adjacent luxury residences, the Company issued 500,000 warrants for the purchase of Braemar common stock with a $6.00 strike price on or after the August 5, 2021 until August 5, 2024. The holder can choose to exercise the warrant by cash or by net issue exercise, in which event the Company shall issue to the holder a number of warrant shares which reflects the fair market value of the Company’s common stock. As of September 30, 2021, no warrants have been exercised.

The initial fair value of the warrant was calculated using a Black-Scholes option pricing model with the following assumptions: three-year contractual term; 97.93% volatility; 0% dividend rate; and a risk-free interest rate of 0.38%. The estimated fair value of the warrants was approximately $1.5 million on the date of issuance. The warrants are re-valued at each reporting period with the change in fair value recorded through earnings.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

In applying the guidance in ASC 815, it was determined that the warrants should be classified as a liability as a result of certain settlement provisions. The warrants are included in derivative liabilities on the condensed consolidated balance sheet and changes in value are reported as a component of unrealized gain (loss) on derivatives on the condensed consolidated statements of operations. This is a Level 2 valuation technique.

8. Fair Value Measurements

Fair Value Hierarchy—Our financial instruments measured at fair value either on a recurring or a non-recurring basis are classified in a hierarchy for disclosure purposes consisting of three levels based on the observability of inputs in the market place as discussed below:

•Level 1: Fair value measurements that are quoted prices (unadjusted) in active markets that we have the ability to access for identical assets or liabilities. Market price data generally is obtained from exchange or dealer markets.

•Level 2: Fair value measurements based on inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices for similar assets and liabilities in active markets, and inputs other than quoted prices that are observable for the asset or liability, such as interest rates and yield curves that are observable at commonly quoted intervals.

•Level 3: Fair value measurements based on valuation techniques that use significant inputs that are unobservable. The circumstances for using these measurements include those in which there is little, if any, market activity for the asset or liability.

Fair value of interest rate caps is determined using the net present value of expected cash flows of each derivative based on the market-based interest rate curve and adjusted for credit spreads of us and our counterparties. Fair value of credit default swaps is obtained from a third-party who publishes various information including the index composition and price data (Level 2 inputs). The fair value of credit default swaps does not contain credit-risk-related adjustments as the change in fair value is settled net through posting cash collateral or reclaiming cash collateral between us and our counterparty. Fair value of interest rate floors is calculated using a third-party discounted cash flow model based on future cash flows that are expected to be received over the remaining life of the floor. The fair value of warrants is determined by using the Black-Scholes option pricing model.

When a majority of the inputs used to value our derivatives fall within Level 2 of the fair value hierarchy, the derivative valuations in their entirety are classified in Level 2 of the fair value hierarchy. However, when the valuation adjustments associated with our derivatives utilize Level 3 inputs, such as estimates of current credit spreads, to evaluate the likelihood of default by us and our counterparties, which we consider significant (10% or more) to the overall valuation of our derivatives, the derivative valuations in their entirety are classified in Level 3 of the fair value hierarchy. Transfers of inputs between levels are determined at the end of each reporting period. In determining the fair values of our derivatives at September 30, 2021, the LIBOR interest rate forward curve (Level 2 inputs) assumed an uptrend from 0.080% to 1.188% for the remaining term of our derivatives. Credit spreads (Level 3 inputs) used in determining the fair values derivatives assumed an uptrend in nonperformance risk for us and all of our counterparties through the maturity dates.

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BRAEMAR HOTELS & RESORTS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following table presents our assets and liabilities measured at fair value on a recurring basis aggregated by the level within which measurements fall in the fair value hierarchy (in thousands):

	Quoted Market Prices (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
September 30, 2021
Assets
Derivative assets:
Interest rate derivatives - caps	$	—	$	74	$	—	$	74
Total	$	—	$	74	$	—	$	74	(1)
Liabilities
Derivative liabilities:
Warrants	—		(1,338)		$	—	(1,338)		(2)
Net	$	—	$	(1,264)	$	—	$	(1,264)

__________________

(1)Reported as “derivative assets” in our condensed consolidated balance sheet.

(2)Reported as “derivative liabilities” in our condensed consolidated balance sheet.

Effect of Fair Value Measured Assets and Liabilities on Condensed Consolidated Statements of Operations

The following table summarizes the effect of fair value measured assets and liabilities on our condensed consolidated statements of operations (in thousands):

	Gain (Loss) Recognized in Income
	Three Months Ended September 30,					Nine Months Ended September 30,
	2021		2020			2021		2020
Assets
Derivative assets:
Interest rate derivatives - caps	$	(48)	$	(30)		$	(126)	$	(93)
Credit default swaps	—		51		(1)	—		226		(1)
Total derivative assets	$	(48)	$	21		$	(126)	$	133
Total	$	(48)	$	21		$	(126)	$	133
Liabilities
Derivative liabilities:
Warrants	190		—			190		—
Net	$	142	$	21		$	64	$	133
Total combined
Interest rate derivatives - floors	$	—	$	3,540		$	—	$	3,615
Interest rate derivatives - caps	(48)		(30)			(126)		(93)
Credit default swaps	—		51			—		226
Warrants	190		—			190		—
Unrealized gain (loss) on derivatives	142		3,561			64		3,748
Realized gain (loss) on interest rate floors	—		(3,540)		(2)	—		(3,615)		(2)
Net	$	142	$	21		$	64	$	133

_______________

(1)Excludes costs associated with credit default swaps of $0 and $64 for the three months ended September 30, 2021 and 2020, respectively, as well as $0 and $191 for the nine months ended September 30, 2021 and 2020, respectively, which is included in “other income (expense)” in our condensed consolidated statements of operations.

(2)Included in “other income (expense)” in our condensed consolidated statements of operations.

19

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

9. Summary of Fair Value of Financial Instruments

Determining the estimated fair values of certain financial instruments such as indebtedness requires considerable judgment to interpret market data. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts. Accordingly, the estimates presented are not necessarily indicative of the amounts at which these instruments could be purchased, sold or settled.

The carrying amounts and estimated fair values of financial instruments were as follows (in thousands):

	September 30, 2021				December 31, 2020
	Carrying Value		Estimated Fair Value		Carrying Value		Estimated Fair Value
Financial assets and liabilities measured at fair value:
Derivative assets	$	74	$	74	$	—	$	—
Derivative liabilities	1,338		1,338		—		—
Financial assets not measured at fair value:
Cash and cash equivalents	$	195,517	$	195,517	$	78,606	$	78,606
Restricted cash	44,753		44,753		34,544		34,544
Accounts receivable, net	17,317		17,317		13,557		13,557
Due from related parties, net	1,910		1,910		991		991
Due from third-party hotel managers	20,390		20,390		12,271		12,271
Financial liabilities not measured at fair value:
Indebtedness	$	1,172,359	$968,075 to $1,069,978		$	1,128,724	$884,325 to $977,411
Accounts payable and accrued expenses	89,265		89,265		61,758		61,758
Dividends and distributions payable	2,112		2,112		2,736		2,736
Due to Ashford Inc.	820		820		2,772		2,772
Due to third-party hotel managers	1,665		1,665		1,393		1,393

Cash, cash equivalents and restricted cash. These financial assets have maturities of less than 90 days and most bear interest at market rates. The carrying value approximates fair value due to their short-term nature. This is considered a Level 1 valuation technique.

Accounts receivable, net, due from related parties, net, accounts payable and accrued expenses, dividends and distributions payable, due to Ashford Inc. and due to/from third-party hotel managers. The carrying values of these financial instruments approximate their fair values due to the short-term nature of these financial instruments. This is considered a Level 1 valuation technique.

Derivative assets and derivative liabilities. See notes 7 and 8 for a complete description of the methodology and assumptions utilized in determining fair values.

Indebtedness, net. Fair value of indebtedness is determined using future cash flows discounted at current replacement rates for these instruments. Cash flows are determined using a forward interest rate yield curve. The current replacement rates are determined by using the U.S. Treasury yield curve or the index to which these financial instruments are tied, and adjusted for the credit spreads. Credit spreads take into consideration general market conditions, maturity and collateral. We estimated the fair value of the total indebtedness to be approximately 82.6% to 91.3% of the carrying value of $1.2 billion at September 30, 2021, and approximately 78.3% to 86.6% of the carrying value of $1.1 billion at December 31, 2020. These fair value estimates are considered a Level 2 valuation technique.

20

BRAEMAR HOTELS & RESORTS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

10. Income (Loss) Per Share

The following table reconciles the amounts used in calculating basic and diluted income (loss) per share (in thousands, except per share amounts):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Net income (loss) attributable to common stockholders - basic and diluted:
Net income (loss) attributable to the Company	$	(6,946)	$	(18,677)	$	(24,887)	$	(79,538)
Less: Dividends on preferred stock	(1,977)		(2,554)		(6,258)		(7,664)
Less: Loss on extinguishment of preferred stock - Series B	(111)		—		(4,595)		—
Undistributed net income (loss) allocated to common stockholders	(9,034)		(21,231)		(35,740)		(87,202)
Distributed and undistributed net income (loss) - basic and diluted	$	(9,034)	$	(21,231)	$	(35,740)	$	(87,202)
Weighted average common shares outstanding:
Weighted average common shares outstanding – basic and diluted	59,207		33,923		48,954		33,103
Income (loss) per share - basic:
Net income (loss) allocated to common stockholders per share	$	(0.15)	$	(0.63)	$	(0.73)	$	(2.63)
Income (loss) per share - diluted:
Net income (loss) allocated to common stockholders per share	$	(0.15)	$	(0.63)	$	(0.73)	$	(2.63)

Due to their anti-dilutive effect, the computation of diluted income (loss) per share does not reflect the adjustments for the following items (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Net income (loss) allocated to common stockholders is not adjusted for:
Income (loss) attributable to redeemable noncontrolling interests in operating partnership	$	(823)	$	(2,381)	$	(3,184)	$	(10,036)
Dividends on preferred stock - Series B	1,058		1,729		3,689		5,189
Loss on extinguishment of preferred stock - Series B	111		—		4,595		—
Interest expense on Convertible Senior Notes	1,361		—		2,010		—
Dividends on preferred stock - Series E	90		—		90		—
Dividends on preferred stock - Series M	4		—		4		—
Total	$	1,801	$	(652)	$	7,204	$	(4,847)
Weighted average diluted shares are not adjusted for:
Effect of unvested restricted shares	89		—		100		25
Effect of assumed conversion of operating partnership units	5,564		3,863		4,543		3,940
Effect of assumed conversion of preferred stock - Series B	4,115		6,728		4,781		6,728
Effect of assumed conversion of exchanged preferred stock - Series B	—		269		485		288
Effect of contingently issuable shares	—		10		—		3
Effect of assumed conversion of Convertible Senior Notes	13,609		—		6,730		—
Effect of assumed conversion of preferred stock - Series E	700		—		233		—
Effect of assumed conversion of preferred stock - Series M	32		—		11		—
Total	24,109		10,870		16,883		10,984

11. Redeemable Noncontrolling Interests in Operating Partnership

Redeemable noncontrolling interests in the operating partnership represents the limited partners’ proportionate share of equity and their allocable share of equity in earnings/losses of Braemar OP, which is an allocation of net income/loss attributable to the common unitholders based on the weighted average ownership percentage of these limited partners’ common units of limited partnership interest in the operating partnership (the “common units”) and units issued under our Long-Term Incentive Plan (the “LTIP” units) that are vested. Each common unit may be redeemed, by the holder, for either cash or, at our sole discretion, up to one share of our REIT common stock, which is either: (i) issued pursuant to an effective registration

21

BRAEMAR HOTELS & RESORTS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

statement; (ii) included in an effective registration statement providing for the resale of such common stock; or (iii) issued subject to a registration rights agreement.

LTIP units, which are issued to certain executives and employees of Ashford LLC as compensation, generally have vesting periods of three years. Additionally, certain independent members of the board of directors have elected to receive LTIP units as part of their compensation, which are fully vested upon grant. Upon reaching economic parity with common units, each vested LTIP unit can be converted by the holder into one common unit which can then be redeemed for cash or, at our election, settled in our common stock. An LTIP unit will achieve parity with the common units upon the sale or deemed sale of all or substantially all of the assets of our operating partnership at a time when our stock is trading at a level in excess of the price it was trading on the date of the LTIP issuance. More specifically, LTIP units will achieve full economic parity with common units in connection with (i) the actual sale of all or substantially all of the assets of our operating partnership or (ii) the hypothetical sale of such assets, which results from a capital account revaluation, as defined in the partnership agreement, for our operating partnership.

The Company issued equity awards in the first quarter of 2021, a substantial majority of which were issued subject to stockholder approval of an increase in the number of shares available for issuance under the Company’s 2013 Equity Incentive Plan. Under the applicable accounting literature, these awards are not accounted for until stockholder approval is obtained. In March 2021, approximately 244,000 LTIP units with a fair value of approximately $1.7 million and a vesting period of three years were granted. Stockholder approval was obtained on May 11, 2021.

On May 11, 2021, approximately 202,000 LTIP units with a fair value of $1.4 million and a vesting period of three years were issued. Additionally, approximately 23,000 LTIP units were issued to independent directors, with a fair value of approximately $164,000, which vested immediately upon grant.

The compensation committee of the board of directors of the Company may authorize the issuance of Performance LTIP units to certain executive officers and directors from time to time. The award agreements provide for the grant of a target number of Performance LTIP units that will be settled in common units of Braemar OP, if, when and to the extent the applicable vesting criteria have been achieved following the end of the performance and service period, which is generally three years from the grant date.

With respect to the 2019 and 2020 award agreements, the number of Performance LTIP units actually earned may range from 0% to 200% of target based on achievement of a specified relative total stockholder return based on the formula determined by the Company’s compensation committee on the grant date. The performance criteria for the Performance LTIP units are based on market conditions under the relevant literature. The corresponding compensation cost is recognized ratably over the service period for the award as the service is rendered, based on the grant date fair value of the award, regardless of the actual outcome of the market condition.

With respect to the 2021 award agreements, the compensation committee shifted to a new performance metric, pursuant to which, the performance awards will be eligible to vest, from 0% to 200% of target, based on achievement of certain performance targets over the three-year performance period commencing on January 1, 2021 and ending on December 31, 2023. The performance criteria for the 2021 performance grants are based on performance conditions under the relevant literature. The corresponding compensation cost is recognized ratably over the service period for the award as the service is rendered, based on the grant date fair value of the award. The grant date fair value of the award may vary from period to period, as the number of performance grants earned may vary since the estimated probable achievement of certain performance targets may vary from period to period. On May 11, 2021, approximately 840,000 Performance LTIP units with a fair value of approximately $5.7 million and a vesting period of three years were granted.

As of September 30, 2021, we have issued a total of approximately 2.4 million LTIP units (including Performance LTIP units), net of cancellations, all of which, other than approximately 572,000 LTIP units and 900,000 Performance LTIP units issued from March 2015 to May 2021, had reached full economic parity with, and are convertible into, common units.

On August 5, 2021, we issued 2.5 million common units in our operating partnership in conjunction with the acquisition of the Mr. C Beverly Hills Hotel. See note 4.

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BRAEMAR HOTELS & RESORTS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

The following table presents the redeemable noncontrolling interests in Braemar OP (in thousands) and the corresponding approximate ownership percentage of our operating partnership:

	September 30, 2021			December 31, 2020
Redeemable noncontrolling interests in Braemar OP	$	39,948		$	27,655
Adjustments to redeemable noncontrolling interests (1)	$	236		$	167
Ownership percentage of operating partnership	8.35		%	9.43		%

____________________________________

(1)    Reflects the excess of the redemption value over the accumulated historical cost.

We allocated net income (loss) to the redeemable noncontrolling interests as illustrated in the table below (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Net (income) loss attributable to redeemable noncontrolling interests in operating partnership	$	823	$	2,381	$	3,184	$	10,036

The following table presents the common units redeemed and the fair value at redemption (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Common units converted to common stock	—		—		2		339
Fair value of common units converted	$	—	$	—	$	15	$	390	(1)

____________________________________

(1)    The redemption value is the greater of historical cost or fair value. The historical cost of the converted units was $3.5 million.

12. Equity and Stock-Based Compensation

Common Stock Dividends—The board of directors did not declare a quarterly common stock dividend for the three and nine months ended September 30, 2021 and 2020.

Restricted Stock Units—We incur stock-based compensation expense in connection with restricted stock units awarded to certain employees of Ashford LLC and its affiliates. We also issue common stock to certain of our independent directors, which vests immediately upon issuance.

The Company issued equity awards in the first quarter of 2021, a substantial majority of which were issued subject to stockholder approval of an increase in the number of shares available for issuance under the Company’s 2013 Equity Incentive Plan. Under the applicable accounting literature, these awards are not accounted for until stockholder approval is obtained. In March 2021, approximately 504,000 restricted stock units with a fair value of approximately $3.5 million and a vesting period of three years were granted. Stockholder approval was obtained on May 11, 2021.

On May 11, 2021, approximately 215,000 restricted stock units with a fair value of approximately $1.5 million and a vesting period of three years were granted. Additionally, approximately 46,000 shares of common stock were issued to independent directors, with a fair value of approximately $322,000, which vested immediately upon grant.

Performance Stock Units—The compensation committee of the board of directors of the Company may authorize the issuance of grants of performance stock units (“PSUs”) to certain executive officers and directors from time to time. The award agreements provide for the grant of a target number of PSUs that will be settled in shares of common stock of the Company, if, when and to the extent the applicable vesting criteria have been achieved following the end of the performance and service period, which is generally three years from the grant date.

With respect to the 2019 and 2020 award agreements, the number of PSUs actually earned may range from 0% to 200% of target based on achievement of a specified relative total stockholder return based on the formula determined by the Company’s compensation committee on the grant date. The performance criteria for the PSUs are based on market conditions under the relevant literature. The corresponding compensation cost is recognized ratably over the service period for the award as the service is rendered, based on the grant date fair value of the award, regardless of the actual outcome of the market condition.

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BRAEMAR HOTELS & RESORTS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

The Company issued equity awards in the first quarter of 2021, a substantial majority of which were issued subject to stockholder approval of an increase in the number of shares available for issuance under the Company’s Amended and Restated 2011 Stock Incentive Plan. Under the applicable accounting literature, these awards are not accounted for until shareholder approval is obtained. Stockholder approval was obtained on May 11, 2021.

With respect to the 2021 award agreements, the compensation committee shifted to a new performance metric, pursuant to which, the performance awards will be eligible to vest, from 0% to 200% of target, based on achievement of certain performance targets over the three-year performance period commencing on January 1, 2021 and ending on December 31, 2023. The performance criteria for the 2021 performance grants are based on performance conditions under the relevant literature, and the 2021 performance grants were issued to non-employees. The corresponding compensation cost is recognized ratably over the service period for the award as the service is rendered, based on the grant date fair value of the award, which may vary from period to period, as the number of performance grants earned may vary since the estimated probable achievement of certain performance targets may vary from period to period.

On May 11, 2021, approximately 446,000 PSUs with a fair value of approximately $6.0 million and vesting period of three years were issued.

8.25% Series D Cumulative Preferred Stock—The dividend for all issued and outstanding shares of the Company’s Series D Cumulative Preferred Stock (the “Series D Preferred Stock”) is set at $2.0625 per annum per share.

The following table summarizes dividends declared (in thousands):

	Three Months Ended September 30,			Nine Months Ended September 30,
	2021		2020	2021		2020
Series D Cumulative Preferred Stock	$	825	825	$	2,475	$	2,475

At-the-Market Common Stock Equity Distribution Program—On December 11, 2017, the Company established an “at-the-market” equity distribution program pursuant to which it may, from time to time, sell shares of its common stock having an aggregate offering price of up to $50 million.

As of September 30, 2021, the Company has sold approximately 7.4 million shares of common stock and received net proceeds of approximately $30.5 million under this program.

The issuance activity is summarized below (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Common shares issued	—		3,046		2,711		3,046
Gross proceeds received	$	—	$	7,715	$	16,119	$	7,715
Commissions and other expenses	—		97		202		97
Net proceeds	$	—	$	7,618	$	15,917	$	7,618

Standby Equity Distribution Agreement—On February 4, 2021, the Company entered into a Standby Equity Distribution Agreement (the “SEDA”) with YA II PN, Ltd. (“YA”), pursuant to which the Company will be able to sell up to 7,780,786 shares of its common stock (the “Commitment Amount”) at the Company’s request any time during the commitment period commencing on February 4, 2021, and terminating on the earliest of (i) the first day of the month next following the 36-month anniversary of the SEDA or (ii) the date on which YA shall have made payment of Advances (as defined in the SEDA) pursuant to the SEDA for shares of the Company’s common stock equal to the Commitment Amount (the “Commitment Period”). Other than with respect to the Initial Advance (as defined below) the shares sold to YA pursuant to the SEDA would be purchased at 95% of the Market Price (as defined below) and would be subject to certain limitations, including that YA could not purchase any shares that would result in it owning more than 4.99% of the Company’s common stock. “Market Price” shall mean the lowest daily VWAP (as defined below) of the Company’s common stock during the five consecutive trading days commencing on the trading day following the date the Company submits an advance notice to YA. “VWAP” means, for any trading day, the daily volume weighted average price of the Company’s common stock for such date on the principal market as reported by Bloomberg L.P. during regular trading hours.

At any time during the Commitment Period the Company may require YA to purchase shares of the Company’s common stock by delivering a written notice to YA setting forth the Advance Shares (as defined in the SEDA) that the Company desires

24

BRAEMAR HOTELS & RESORTS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

to issue and sell to YA (the “Advance Notice”). The Company may deliver an Advance Notice for an initial Advance for up to 1,200,000 Advance Shares (the “Initial Advance”). The preliminary purchase price per share for such shares shall be 100% of the average daily VWAP for the five consecutive trading days immediately prior to the date of the Advance Notice (the “Preliminary Purchase Price”).

Pursuant to the SEDA, we currently intend to use the net proceeds from any sale of the shares for working capital purposes, including the repayment of outstanding debt. There are no other restrictions on future financing transactions. The SEDA does not contain any right of first refusal, participation rights, penalties or liquidated damages. We are not required to pay any additional amounts to reimburse or otherwise compensate YA in connection with the transaction except for a $10,000 structuring fee.

The issuance activity under the SEDA is summarized below (in thousands):

	Three Months Ended September 30, 2021		Nine Months Ended September 30, 2021
Common shares sold to YA	—		1,700
Proceeds received	$	—	$	10,000

Common Stock Resale Agreement—On April 21, 2021, the Company and Lincoln Park Capital Fund, LLC (“Lincoln Park”), entered into a purchase agreement, pursuant to which the Company may issue or sell to Lincoln Park up to 8,893,565 shares of the Company’s common stock from time to time during the term of the purchase agreement. Concurrently with entering into the Purchase Agreement, the Company also entered into a registration rights agreement with Lincoln Park, pursuant to which it agreed to provide Lincoln Park with certain registration rights related to the shares issued under the Purchase Agreement.

Upon entering into the purchase agreement, the Company issued 15,000 shares of the Company’s common stock as consideration for Lincoln Park’s execution and delivery of the purchase agreement. The issuance activity under the Lincoln Park agreement is summarized below (in thousands):

	Three Months Ended September 30, 2021		Nine Months Ended September 30, 2021
Common shares sold to Lincoln Park	—		766
Additional commitment shares	—		15
Total common shares issued to Lincoln Park	—		781
Proceeds received	$	—	$	4,217

At-the-Market Equity Distribution Agreement—On May 25, 2021, the Company entered into an equity distribution agreement with Virtu Americas LLC (“Virtu”), to sell from time to time shares of the Company’s common stock having an aggregate offering price of up to $50 million (the “Virtu May 2021 EDA”). We will pay Virtu a commission of approximately 1.0% of the gross sales price of the shares of our common stock sold. The Company may also sell some or all of the shares of our common stock to Virtu as principal for its own account at a price agreed upon at the time of sale.

The issuance activity under the Virtu May 2021 EDA is summarized below (in thousands):

	Three Months Ended September 30, 2021		Nine Months Ended September 30, 2021
Common shares issued	2,367		8,339
Gross proceeds received	$	13,421	$	50,000
Commissions and other expenses	134		500
Net proceeds	$	13,287	$	49,500

On July 12, 2021, the Company entered into a second equity distribution agreement with Virtu to sell from time to time shares of our common stock having an aggregate offering price of up to $100 million (the “Virtu July 2021 EDA”). We will pay Virtu a commission of approximately 1.0% of the gross sales price of the shares of our common stock sold. The Company may also sell some or all of the shares of our common stock to Virtu as principal for its own account at a price agreed upon at the time of sale.

25

BRAEMAR HOTELS & RESORTS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

The issuance activity under the Virtu July 2021 EDA is summarized below (in thousands):

	Three Months Ended September 30, 2021		Nine Months Ended September 30, 2021
Common shares issued	4,183		4,183
Gross proceeds received	$	21,363	$	21,363
Commissions and other expenses	214		214
Net proceeds	$	21,149	$	21,149

Stock Repurchases—On December 5, 2017, our board of directors reapproved the stock repurchase program pursuant to which the board of directors granted a repurchase authorization to acquire shares of the Company’s common stock, par value $0.01 per share having an aggregate value of up to $50 million. The board of directors’ authorization replaced any previous repurchase authorizations. No shares were repurchased during the nine months ended September 30, 2021 and 2020. As of September 30, 2021, $50 million remains authorized by the board of directors pursuant to the December 5, 2017 approval.

13. Preferred Stock

5.50% Series B Cumulative Convertible Preferred Stock

Each share of our 5.50% Series B Cumulative Convertible Preferred Stock (the “Series B Convertible Preferred Stock”) is convertible at any time, at the option of the holder, into a number of whole shares of common stock at a conversion price of $18.70 (which represents a conversion rate of 1.3372 shares of our common stock, subject to certain adjustments). The Series B Convertible Preferred Stock is also subject to conversion upon certain events constituting a change of control. Holders of the Series B Convertible Preferred Stock have no voting rights, subject to certain exceptions. The Series B Convertible Preferred Stock dividend for all issued and outstanding shares is set at $1.375 per annum per share.

The Company may, at its option, cause the Series B Convertible Preferred Stock to be converted in whole or in part, on a pro-rata basis, into fully paid and nonassessable shares of the Company’s common stock at the conversion price, provided that the “Closing Bid Price” (as defined in the Articles Supplementary) of the Company’s common stock shall have equaled or exceeded 110% of the conversion price for the immediately preceding 45 consecutive trading days ending three days prior to the date of notice of conversion.

Additionally, the Series B Convertible Preferred Stock contains cash redemption features that consist of: 1) an optional redemption in which on or after June 11, 2020, the Company may redeem shares of the Series B Convertible Preferred Stock, in whole or in part, for cash at a redemption price of $25.00 per share, plus any accumulated, accrued and unpaid dividends; 2) a special optional redemption, in which on or prior to the occurrence of a Change of Control (as defined), the Company may redeem shares of the Series B Convertible Preferred Stock, in whole or in part, for cash at a redemption price of $25.00 per share; and 3) a REIT Termination Event and Listing Event Redemption, in which at any time (i) a REIT Termination Event (defined below) occurs or (ii) the Company’s common stock fails to be listed on the NYSE, NYSE American, or NASDAQ, or listed or quoted on an exchange or quotation system that is a successor thereto (each a “National Exchange”), the holder of Series B Convertible Preferred Stock shall have the right to require the Company to redeem any or all shares of Series B Convertible Preferred Stock at 103% of the liquidation preference ($25.00 per share, plus any accumulated, accrued, and unpaid dividends) in cash.

A REIT Termination Event, shall mean the earliest of:

(i)    filing of income tax return where the Company does not compute its income as a REIT;

(ii)    stockholders’ approval on ceasing to be qualified as a REIT;

(iii)    board of directors’ approval on ceasing to be qualified as a REIT;

(iv)    board’s determination based on the advice of counsel to cease to be qualified as a REIT; or

(v)    determination within the meaning of Section 1313(a) of the Code to cease to be qualified as a REIT.

On December 4, 2019, we entered into equity distribution agreements with certain sales agents to sell from time to time shares of our Series B Convertible Preferred Stock having an aggregate offering price of up to $40.0 million. Sales of shares of our Series B Convertible Preferred Stock may be made in negotiated transactions or transactions that are deemed to be “at-the-market” offerings as defined in Rule 415 of the Securities Act of 1933, as amended (the “Securities Act”), including sales made directly on the NYSE, the existing trading market for our Series B Convertible Preferred Stock, or sales made to or through a market maker other than on an exchange or through an electronic communications network. We will pay each of the sales

26

BRAEMAR HOTELS & RESORTS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

agents a commission, which in each case shall not be more than 2.0% of the gross sales price of the shares of our Series B Convertible Preferred Stock sold through such sales agents. As of September 30, 2021, we have sold approximately 65,000 shares of our Series B Convertible Preferred Stock and received proceeds of approximately $1.2 million under this program.

The issuance activity is summarized below (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Series B Convertible Preferred Stock shares issued	—		—		—		23
Gross proceeds received	$	—	$	—	$	—	$	439
Commissions and other expenses	—		—		—		7
Net proceeds	$	—	$	—	$	—	$	432

Series B Convertible Preferred Stock does not meet the requirements for permanent equity classification prescribed by the authoritative guidance because of certain cash redemption features that are outside our control. As such, the Series B Convertible Preferred Stock is classified outside of permanent equity.

The following table summarizes dividends declared (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Series B Convertible Preferred Stock	$	1,058	$	1,729	$	3,689	$	5,189

During 2021, Braemar entered into privately negotiated exchange agreements with certain holders of the Series B Convertible Preferred Stock, in reliance on Section 3(a)(9) of the Securities Act. The table below summarizes the activity (in thousands):

	Three Months Ended September 30, 2021		Nine Months Ended September 30, 2021
	Preferred Shares Tendered	Common Shares Issued	Preferred Shares Tendered	Common Shares Issued
Series B Convertible Preferred Stock	30	120	1,953	7,291

Series E Redeemable Preferred Stock

On April 2, 2021, the Company entered into equity distribution agreements with certain sales agents to sell from time-to-time shares of the Series E Redeemable Preferred Stock (the “Series E Preferred Stock”). Pursuant to such equity distribution agreements, the Company is offering a maximum of 20,000,000 shares of Series E Preferred Stock in a primary offering price of $25.00 per share. The Company is also offering a maximum of 8,000,000 shares of the Series E Preferred Stock pursuant to a dividend reinvestment plan (the “DRIP”) at $25.00 per share (the “Stated Value”).

The Series E Preferred Stock ranks senior to all classes or series of the Company’s common stock and future junior securities, on a parity with each series of the Company’s outstanding preferred stock (the Series B Convertible Preferred stock, the Series D Preferred Stock and the Series M Preferred Stock (as defined below)) and with any future parity securities and junior to future senior securities and to all of the Company’s existing and future indebtedness, with respect to the payment of dividends and the distribution of amounts upon liquidation, dissolution or winding up of the Company’s affairs.

Holders of the Series E Preferred Stock shall have the right to vote for the election of directors of the Company and on all other matters requiring stockholder action by the holders of the common stock, each share being entitled to vote to the same extent as one share of the Company’s common stock, and all such shares voting together as a single class. If and whenever dividends on any shares of the Series E Preferred Stock shall be in arrears for 18 or more monthly periods, whether or not such quarterly periods are consecutive the number of directors then constituting the Board shall be increased by two and the holders of such shares of Series E Preferred Stock shall be entitled to vote for the election of the additional directors of the Company who shall each be elected for one-year terms.

Each share is redeemable at any time, at the option of the holder, at a redemption price of $25.00 per share, plus any accumulated, accrued, and unpaid dividends, less a redemption fee. Starting on the second anniversary, each share is redeemable at any time, at the option of the Company, at a redemption price of $25.00 per share, plus any accumulated, accrued, and unpaid dividends (with no redemption fee). The Series E Preferred Stock is also subject to conversion upon certain

27

BRAEMAR HOTELS & RESORTS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

events constituting a change of control. Upon such change of control events, holders have the option to convert their shares of Series E Preferred Stock into a maximum of 5.69476 shares of our common stock.

The redemption fee shall be an amount equal to:

•8.0% of the stated value of $25.00 per share (the “Stated Value”) beginning on the Original Issue Date (as defined in the Articles Supplementary) of the shares of the Series E Preferred Stock to be redeemed;

•5.0% of the Stated Value beginning on the second anniversary from the Original Issue Date of the shares of the Series E Preferred Stock to be redeemed; and

•0% of the Stated Value beginning on the third anniversary from the Original Issue Date of the shares of the Series E Preferred Stock to be redeemed.

The Company has the right, in its sole discretion, to redeem the shares in cash, or in an equal of shares of common stock or any combination thereof, calculated based on the closing price per share for the single trading day prior to the date of redemption.

The Series E Preferred Stock cash dividends are as follows:

•8.0% per annum of the Stated Value beginning on the date of the first settlement of the Series E Preferred Stock (the “Date of Initial Closing”);

•7.75% per annum of the Stated Value beginning on the first anniversary from the Date of Initial Closing; and

•7.5% per annum of the Stated Value beginning on the second anniversary from the Date of Initial Closing.

Dividends will be authorized and declared on a monthly basis and payable in arrears on the 15th of each month to holders of record at the close of business on the last business day of each month immediately preceding the applicable thereafter dividend payment date. Dividends will be computed on the basis of twelve 30-day months and a 360-day year.

The Company has a DRIP that allows for participating holders to have their Series E Preferred Stock dividend distributions automatically reinvested in additional shares of the Series E Preferred Stock at a price of $25.00 per share.

The issuance activity of the Series E Preferred Stock is summarized below (in thousands):

	Three Months Ended September 30,		Nine Months Ended September 30,
	2021		2021
Series E Preferred Stock shares issued	266		266
Net proceeds	$	5,976	$	5,976

The Series E Preferred Stock does not meet the requirements for permanent equity classification prescribed by the authoritative guidance because of certain cash redemption features that are outside of the Company’s control. As such, the Series E Preferred Stock is classified outside of permanent equity.

At the date of issuance, the carrying amount of the Series E Preferred Stock was less than the redemption value. As a result of the Company’s determination that redemption is probable the carrying value will be increased to the redemption amount each reporting period.

The redemption value adjustment of Series E Preferred Stock is summarized below (in thousands):

	September 30, 2021		December 31, 2020
Series E Preferred Stock	$	6,110	$	—
Adjustments to Series E Preferred Stock (1)	$	1,906	$	—

________

(1)    Reflects the excess of the redemption value over the accumulated carrying value.

The following table summarizes dividends declared (in thousands):

	Three Months Ended September 30,	Nine Months Ended September 30,
	2021	2021
Series E Preferred Stock	90	90

28

BRAEMAR HOTELS & RESORTS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

Series M Redeemable Preferred Stock

On April 2, 2021, the Company entered into equity distribution agreements with certain sales agents to sell from time-to-time shares of the Series M Redeemable Preferred Stock (the “Series M Preferred Stock”). Pursuant to such equity distribution agreements, the Company is offering a maximum of 20,000,000 shares of the Series M Preferred Stock (par value $0.01) in a primary offering price of $25.00 per share (or “Stated Value”). The Company is also offering a maximum of 8,000,000 shares of Series M Preferred Stock pursuant to the DRIP at $25.00 per share.

The Series M Preferred Stock ranks senior to all classes or series of the Company’s common stock and future junior securities, on a parity with each series of the Company’s outstanding preferred stock (the Series B Convertible Preferred Stock, the Series D Preferred Stock and the Series E Preferred Stock) and with any future parity securities and junior to future senior securities and to all of the Company’s existing and future indebtedness, with respect to the payment of dividends and the distribution of amounts upon liquidation, dissolution or winding up of the Company’s affairs.

Holders of the Series M Preferred Stock shall have the right to vote for the election of directors of the Company and on all other matters requiring stockholder action by the holders of the common stock, each share being entitled to vote to the same extent as one share of the Company’s common stock, and all such shares voting together as a single class. If and whenever dividends on any shares of Series E Preferred Stock shall be in arrears for 18 or more monthly periods, whether or not such quarterly periods are consecutive the number of directors then constituting the Board shall be increased by two and the holders of such shares of Series M Preferred Stock shall be entitled to vote for the election of the additional directors of the Company who shall each be elected for one-year terms.

The redemption fee shall be an amount equal to:

•1.5% of the Stated Value of $25.00 per share beginning on the Series M Original Issue Date (as defined below) of the shares of Series M Preferred Stock to be redeemed; and

•0% of the Stated Value beginning on the first anniversary from the Original Issue Date of the shares of Series M Preferred Stock to be redeemed.

The Company has the right, in its sole discretion, to redeem the shares in cash, or in an equal of shares of common stock or any combination thereof, calculated based on the closing price per share for the single trading day prior to the date of redemption.

Holders of Series M Preferred Stock are entitled to receive cumulative cash dividends at the initial rate of 8.2% per annum of the Stated Value of $25.00 per share (equivalent to an annual dividend rate of $2.05 per share). Beginning one year from the date of original issuance of each share of Series M Preferred Stock (the “Series M Original Issue Date of Series M”) and on each one-year anniversary thereafter for such share of Series M Preferred Stock, the dividend rate shall increase by 0.10% per annum; provided, however, that the dividend rate for any share of Series M Preferred Stock shall not exceed 8.7% per annum of the Stated Value.

Dividends will be authorized and declared on a monthly basis and payable in arrears on the 15th of each month to holders of record at the close of business on the last business day of each month immediately preceding the applicable dividend payment date. Dividends will be computed on the basis of twelve 30-day months and a 360-day year.

The Company has a DRIP that allows for participating holders to have their Series M Preferred Stock dividend distributions automatically reinvested in additional shares of the Series M Preferred Stock at a price of $25.00 per share.

The issuance activity of Series M Preferred Stock is summarized below (in thousands):

	Three Months Ended September 30,		Nine Months Ended September 30,
	2021		2021
Series M Preferred Stock shares issued	15		15
Net proceeds	$	355	$	355

The Series M Preferred Stock does not meet the requirements for permanent equity classification prescribed by the authoritative guidance because of certain cash redemption features that are outside the Company’s control. As such, the Series M Preferred Stock is classified outside of permanent equity.

29

BRAEMAR HOTELS & RESORTS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

At the date of issuance, the carrying amount of the Series M Preferred Stock was less than the redemption value. As a result of the Company’s determination that redemption is probable the carrying value will be increased to the redemption amount each reporting period.

The redemption value adjustment of Series M Preferred stock is summarized below (in thousands):

	September 30, 2021		December 31, 2020
Series M Preferred Stock	$	361	$	—
Adjustments to Series M Preferred Stock (1)	$	111	$	—

________

(1)    Reflects the excess of the redemption value over the accumulated carrying value.

The following table summarizes dividends declared (in thousands):

	Three Months Ended September 30,		Nine Months Ended September 30,
	2021		2021
Series M Preferred Stock	$	4	$	4

14. Related Party Transactions

Ashford Inc.

Advisory Agreement

Ashford LLC, a subsidiary of Ashford Inc., acts as our advisor. Our chairman, Mr. Monty Bennett, also serves as chairman of the board of directors and chief executive officer of Ashford Inc. Under our advisory agreement, we pay advisory fees to Ashford LLC. We pay a monthly base fee equal to 1/12th of the sum of (i) 0.70% of the total market capitalization of our company for the prior month, plus (ii) the Net Asset Fee Adjustment (as defined in our advisory agreement), if any, on the last day of the prior month during which our advisory agreement was in effect; provided, however in no event shall the base fee for any month be less than the minimum base fee as provided by our advisory agreement. The base fee is payable on the 5th business day of each month.

The minimum base fee for Braemar for each month will be equal to the greater of:

▪90% of the base fee paid for the same month in the prior year; and

▪1/12th of the G&A Ratio (as defined) multiplied by the total market capitalization of Braemar.

We are also required to pay Ashford LLC an incentive fee that is measured annually (or for a stub period if the advisory agreement is terminated at other than year-end). Each year that our annual total stockholder return exceeds the average annual total stockholder return for our peer group we pay Ashford LLC an incentive fee over the following three years, subject to the Fixed Charge Coverage Ratio (“FCCR”) Condition, as defined in the advisory agreement, which relates to the ratio of adjusted EBITDA to fixed charges. We also reimburse Ashford LLC for certain reimbursable overhead and internal audit, risk management advisory and asset management services, as specified in the advisory agreement. We also recorded equity-based compensation expense for equity grants of common stock and LTIP units awarded to officers and employees of Ashford LLC in connection with providing advisory services.

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BRAEMAR HOTELS & RESORTS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

The following table summarizes the advisory services fees incurred (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Advisory services fee
Base advisory fee	$	2,758	$	2,386	$	7,981	$	7,579
Reimbursable expenses (1)	694		404		1,696		1,360
Equity-based compensation (2)	2,994		1,785		6,666		5,606
Incentive fee	(1,637)		—		—		—
Total	$	4,809	$	4,575	$	16,343	$	14,545

________

(1)Reimbursable expenses include overhead, internal audit, risk management advisory and asset management services.

(2)    Equity-based compensation is associated with equity grants of Braemar’s common stock, PSUs, LTIP units and Performance LTIP units awarded to officers and employees of Ashford LLC.

Pursuant to the Company's hotel management agreements with each hotel management company, the Company bears the economic burden for casualty insurance coverage. Under the advisory agreement, Ashford Inc. secures casualty insurance policies to cover Braemar, Ashford Hospitality Trust, Inc. (“Ashford Trust”), their hotel managers, as needed, and Ashford Inc. The total loss estimates included in such policies are based on the collective pool of risk exposures from each party. Ashford Inc.'s risk management department manages the casualty insurance program. At the beginning of each year, Ashford Inc.'s risk management department collects funds from Braemar, Ashford Trust and their respective hotel management companies, to fund the casualty insurance program as needed, on an allocated basis.

Lismore

On March 20, 2020, the Company entered into an agreement with Lismore, a subsidiary of Ashford Inc., to engage Lismore to seek modifications, forbearances or refinancings of the Company’s loans (the “Lismore Agreement”). The Lismore Agreement was terminated effective March 20, 2021.

Upon entering into the agreement with Lismore, the Company made an initial payment of approximately $1.4 million. The Company paid approximately $1.4 million related to periodic installments of which $683,000 was expensed in accordance with the agreement. The remaining $681,000 was set off against the cash payment of the base advisory fee per the agreement upon contract termination in March 2021. Further, the Company paid approximately $1.4 million in success fees in connection with signed forbearance or other agreements. In total, the Company paid approximately $4.1 million under the Lismore Agreement.

For the three and nine months ended September 30, 2021, the Company recognized expense of $0 and $341,000, respectively. For the three and nine months ended September 30, 2020, the Company recognized expense of $1.2 million and $2.7 million, respectively. These expenses are included in “write-off of loan costs and exit fees” in the condensed consolidated statements of operations.

The Company engaged Lismore to negotiate, on the Company’s behalf, one or more modifications to the terms of the mortgage loan assumed in connection with the acquisition of the Mr. C Beverly Hills Hotel. Upon closing of the hotel, the Company paid Lismore a debt placement fee of $150,000.

Ashford Securities

On September 25, 2019, Ashford Inc. announced the formation of Ashford Securities LLC (“Ashford Securities”) to raise retail capital in order to grow its existing and future platforms. In conjunction with the formation of Ashford Securities, Braemar has entered into a contribution agreement (the “Initial Contribution Agreement”) with Ashford Inc. pursuant to which Braemar has agreed to contribute, with Ashford Trust, up to $15.0 million to fund the operations of Ashford Securities. Costs for all operating expenses of Ashford Securities that were contributed by Ashford Trust and Braemar will be expensed as incurred. These costs were allocated initially to Ashford Trust and Braemar based on an allocation percentage of 75% to Ashford Trust and 25% Braemar. Upon reaching the earlier of $400 million in aggregate non-listed preferred equity offerings raised or June 10, 2023, there will be a true up (the “Initial True-up Date”) between Ashford Trust and Braemar, whereby the actual capital contributions contributed by each company will be based on the actual amount of capital raised by Ashford Trust and Braemar, respectively. After the Initial True-Up Date, the capital contributions will be allocated between Ashford Trust and Braemar quarterly based on the actual capital raised through Ashford Securities.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

On December 31, 2020, an Amended and Restated Contribution Agreement (the “Amended and Restated Contribution Agreement”) was entered into by Ashford Inc., Ashford Trust and Braemar with respect to expenses to be reimbursed by Ashford Securities. The Initial True-Up Date did not occur, and beginning on the effective date of the Amended and Restated Contribution Agreement, costs will be allocated based upon an allocation percentage of 50% to Ashford Inc., 50% to Braemar and 0% to Ashford Trust. Upon reaching the earlier of $400 million in aggregate non-listed preferred equity offerings raised, or June 10, 2023, there will be an Amended and Restated true up (the “Amended and Restated True-up Date”) among Ashford Inc., Ashford Trust and Braemar whereby the actual expense reimbursement paid by each company will be based on the actual amount of capital raised by Ashford Inc., Ashford Trust and Braemar, respectively. After the Amended and Restated True-Up Date, the expense reimbursements will be allocated among Ashford Inc., Ashford Trust and Braemar quarterly based on the actual capital raised through Ashford Securities. Additionally, Braemar’s aggregate Capital Contributions under the Initial Contribution Agreement and the Amended and Restated Contribution Agreement shall not exceed $3.75 million unless otherwise agreed to in writing by Braemar.

As of September 30, 2021, Braemar has funded approximately $2.8 million. Additionally, as of September 30, 2021, $144,000 of the pre-funded amount was included in “other assets” on our condensed consolidated balance sheets.

The table below summarizes the amount Braemar has expensed related to reimbursed operating expenses of Ashford Securities (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
Line Item	2021		2020		2021		2020
Corporate, general and administrative	$	642	$	228	$	1,505	$	558

Enhanced Return Funding Program

Concurrent with Amendment No. 1 to the Fifth Amended and Restated Advisory Agreement with Ashford Inc. (“Amendment No. 1”), on January 15, 2019, the Company also entered into the Enhanced Return Funding Program Agreement (the “ERFP Agreement”) with Ashford Inc. The “key money investments” concept previously contemplated by our advisory agreement was replaced with the ERFP Agreement. The Fifth Amended and Restated Advisory Agreement was also amended to name Ashford Inc. and its subsidiaries as the Company’s sole and exclusive provider of asset management, design and construction and other services offered by Ashford Inc. or any of its subsidiaries. The independent members of our board of directors and the independent members of the board of directors of Ashford Inc., with the assistance of separate and independent legal counsel, engaged to negotiate the ERFP Agreement on behalf of Ashford Inc. and Braemar, respectively.

The ERFP Agreement generally provides that Ashford LLC will provide funding to facilitate the acquisition of properties by Braemar OP that are recommended by Ashford LLC, in an aggregate amount of up to $50 million (subject to increase to up to $100 million by mutual agreement). Each funding will equal 10% of the property acquisition price and will be made either at the time of the property acquisition or at any time generally within the two-year period following the date of such acquisition, in exchange for FF&E for use at the acquired property or any other property owned by Braemar OP.

The initial term of the ERFP Agreement was two years (the “Initial Term”). At the end of the Initial Term, the ERFP Agreement automatically renewed for one year and shall automatically renew for successive one-year periods (each such period a “Renewal Term”) unless either Ashford Inc. or Braemar provides written notice to the other at least sixty days in advance of the expiration of the Initial Term or Renewal Term, as applicable, that such notifying party intends not to renew the ERFP Agreement.

During the second quarter of 2021, the Company sold approximately $1.6 million of hotel FF&E from Braemar hotel properties to Ashford LLC, which was subsequently leased back to the Company rent-free. In accordance with ASC 842, the Company evaluated the transactions and concluded that the transactions qualified as sales. As a result, the Company recorded an aggregate gain of $0 and $197,000 for the three and nine months ended September 30, 2021, respectively. The gains are recorded in “gain (loss) on insurance settlement, disposition of assets and sale of hotel properties” in our condensed consolidated statements of operations.

In the second quarter of 2021, upon expiration of an ERFP lease, the Company purchased the underlying FF&E from Ashford Inc. at fair value for $144,000, which was paid during the third quarter of 2021.

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BRAEMAR HOTELS & RESORTS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

Design and Construction Services

In connection with Ashford Inc.’s August 8, 2018 acquisition of Remington Lodging’s design and construction business, we entered into a design and construction services agreement with Ashford Inc.’s subsidiary, Premier Project Management LLC (“Premier”), pursuant to which Premier provides design and construction services to our hotels, including construction management, interior design, architectural services, and the purchasing, freight management, and supervision of installation of FF&E and related services. Pursuant to the design and construction services agreement, we pay Premier: (a) design and construction fees of up to 4% of project costs; and (b) for the following services: (i) architectural (6.5% of total construction costs); (ii) construction management for projects without a general contractor (10% of total construction costs); (iii) interior design (6% of the purchase price of the FF&E designed or selected by Premier); and (iv) FF&E purchasing (8% of the purchase price of FF&E purchased by Premier; provided that if the purchase price exceeds $2.0 million for a single hotel in a calendar year, then the purchasing fee is reduced to 6% of the FF&E purchase price in excess of $2.0 million for such hotel in such calendar year). On March 20, 2020, we amended the design and construction services agreement to provide that Premier’s fees shall be paid by the Company to Premier upon the completion of any work provided by third-party vendors to the Company.

Hotel Management Services

On November 6, 2019, Ashford Inc. completed the acquisition of Remington Lodging’s hotel management business. Following the acquisition, hotel management services are provided by Remington Hotels, a subsidiary of Ashford Inc., under the respective hotel management agreement with each customer, including Ashford Trust and Braemar.

At September 30, 2021, Remington Hotels managed four of our 14 hotel properties.

We pay monthly hotel management fees equal to the greater of approximately $14,000 per hotel (increased annually based on consumer price index adjustments) or 3% of gross revenues as well as annual incentive management fees, if certain operational criteria were met and other general and administrative expense reimbursements primarily related to accounting services.

Pursuant to the terms of the Letter Agreement dated March 13, 2020 (the “Hotel Management Letter Agreement”), in order to allow Remington Hotels to better manage its corporate working capital and to ensure the continued efficient operation of our hotels, we agreed to pay the base fee and to reimburse all expenses on a weekly basis for the preceding week, rather than on a monthly basis. The Hotel Management Letter Agreement went into effect on March 13, 2020 and will continue until terminated by us.

We also have a mutual exclusivity agreement with Remington Hotels, pursuant to which: (i) we have agreed to engage Remington Hotels to provide management services with respect to any hotel we acquire or invest in, to the extent we have the right and/or control the right to direct the management of such hotel; and (ii) Remington Hotels has agreed to grant us a right of first refusal to purchase any opportunity to develop or construct a hotel that it identifies that meets our initial investment guidelines. We are not, however, obligated to engage Remington Hotels if our independent directors either: (i) unanimously vote to hire a different manager or developer; or (ii) by a majority vote elect not to engage such related party because either special circumstances exist such that it would be in the best interest of our Company not to engage such related party, or, based on related party’s prior performance, it is believed that another manager could perform the management or other duties materially better.

Ashford Trust

As of September 30, 2021, the Company has an $800,000 receivable from Ashford Trust, included in “due from related parties, net.” The receivable relates to a legal settlement between Ashford Trust and the City of San Francisco regarding a transfer tax matter associated with the transfer of The Clancy from Ashford Trust to Braemar upon Braemar’s 2013 spin-off from Ashford Trust. The transfer taxes were initially paid by Braemar at the time of the spin-off. The $800,000 gain is included in “(gain) loss on legal settlements” on the condensed consolidated statements of operations.

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BRAEMAR HOTELS & RESORTS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

15. Commitments and Contingencies

Restricted Cash—Under certain management and debt agreements for our hotel properties existing at September 30, 2021, escrow payments are required for insurance, real estate taxes and debt service. In addition, for certain properties based on the terms of the underlying debt and management agreements, we escrow 4% to 5% of gross revenues for capital improvements.

Licensing Fees—In conjunction with the Mr. C Beverly Hills Hotel acquisition on August 5, 2021, we entered into an Intellectual Property Sublease Agreement, which allows us to continue to use certain proprietary marks associated with the Mr. C brand name. In return, we pay licensing fees of: (i) 1% of total operating revenue; (ii) 2% of gross food and beverage revenues; and (iii) 25% of food and beverage profits. The agreement expires on August 4, 2022.

The table below summarizes the licensing fees incurred (in thousands):

Line Item	Three Months Ended September 30, 2021		Nine Months Ended September 30, 2021
Other hotel expenses	$	53	$	53

Management Fees—Under hotel management agreements for our hotel properties existing at September 30, 2021, we pay a monthly hotel management fee equal to the greater of approximately $15,000 per hotel (increased annually based on consumer price index adjustments) or 3% of gross revenues, or in some cases 2.5% to 5.0% of gross revenues, as well as annual incentive management fees, if applicable. These management agreements expire from December 2023 through December 2065, with renewal options. If we terminate a management agreement prior to its expiration, we may be liable for estimated management fees through the remaining term, liquidated damages or, in certain circumstances, we may substitute a new management agreement.

Income Taxes—We and our subsidiaries file income tax returns in the federal jurisdiction and various states. Tax years 2017 through 2020 remain subject to potential examination by certain federal and state taxing authorities.

Litigation—On October 24, 2019, the Company provided notice to Accor of the material breach of Accor’s responsibilities under the Accor management agreement for the Sofitel Chicago Magnificent Mile at 20 East Chestnut Street in Chicago, Illinois. On November 7, 2019, Accor filed a complaint against Ashford TRS Chicago II in the Supreme Court of the State of New York, New York County, seeking a declaratory judgment that no breach has occurred. Accor’s complaint was dismissed on or about February 27, 2020. On January 6, 2020, Ashford TRS Chicago II filed a complaint against Accor in the Supreme Court of the State of New York, New York County, alleging breach of the Accor management agreement and seeking declaration of its right to terminate the Accor management agreement. On July 20, 2020, Accor filed an Amended Answer and Counterclaims against Ashford TRS Chicago II. Accor asserts two causes of action: First, Accor asserts a counterclaim for declaratory judgment that Accor correctly calculated the amount payable to Ashford TRS Chicago II under the management agreement to “cure” Accor’s performance test failure (the “Cure Amount”). Second, Accor asserts a counterclaim for breach of contract on the basis that Ashford TRS Chicago II breached the management agreement by wrongfully maintaining that the Cure Amount for the 2018 and 2019 Performance Test failure is $1,031,549 instead of $535,120. As of September 30, 2021, no amounts have been accrued.

One of the Company’s hotel management companies is currently involved in litigation regarding its employment policies and practices at multiple California hotels, including one of the Company’s hotels. The Company believes it is probable that the litigation will result in a loss due to a potential pre-trial settlement, in which case the Company estimates its potential loss will be approximately $500,000; however, it is entitled to indemnification for a portion of such loss. As of September 30, 2021, approximately $500,000 has been accrued.

In June 2020, each of the Company, Ashford Trust, Ashford Inc., and Lismore, a subsidiary of Ashford Inc. (collectively with the Company, Ashford Trust, Ashford Inc. and Lismore, the “Ashford Companies”), received an administrative subpoena from the SEC. The Company’s administrative subpoena requires the production of documents and other information since January 1, 2018 relating to, among other things, (1) related party transactions among the Ashford Companies (including the Lismore Agreement between the Company and Lismore pursuant to which the Company engaged Lismore to negotiate the refinancing, modification or forbearance of certain mortgage debt) or between any of the Ashford Companies and any officer, director or owner of the Ashford Companies or any entity controlled by any such person, and (2) the Company’s accounting policies, procedures, and internal controls related to such related party transactions. In addition, in October 2020, Mr. Monty J. Bennett, chairman of our board of directors, received an administrative subpoena from the SEC requiring testimony and the

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BRAEMAR HOTELS & RESORTS INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

production of documents and other information substantially similar to the requests in the subpoenas received by the Ashford Companies. The Company and Mr. Monty J. Bennett are responding to the administrative subpoenas.

On December 20, 2016, a class action lawsuit was filed against one of the Company’s hotel management companies in the Superior Court of the State of California in and for the County of Contra Costa alleging violations of certain California employment laws, which class action affects two hotels owned by subsidiaries of the Company. The court has entered an order granting class certification with respect to: (1) a statewide class of non-exempt employees of our manager who were allegedly deprived of rest breaks as a result of our manager’s previous written policy requiring its employees to stay on premises during rest breaks; and (2) a derivative class of non-exempt former employees of our manager who were not paid for allegedly missed breaks upon separation from employment. Notices to potential class members were sent out on February 2, 2021. Potential class members had until April 4, 2021 to opt out of the class; however, the total number of employees in the class has not been definitively determined and is the subject of continuing discovery. While we believe it is reasonably possible that we may incur a loss associated with this litigation, because there remains uncertainty under California law with respect to a significant legal issue, discovery relating to class members continues, and the trial judge retains discretion to award lower penalties than set forth in the applicable California employment laws, we do not believe any potential loss to the Company is reasonably estimable at this time. As of September 30, 2021, no amounts have been accrued.

We are also engaged in other legal proceedings that have arisen but have not been fully adjudicated. To the extent the claims giving rise to these legal proceedings are not covered by insurance, they relate to the following general types of claims: employment matters, tax matters and matters relating to compliance with applicable law (for example, the ADA and similar state laws). The likelihood of loss from these legal proceedings is based on the definitions within contingency accounting literature. We recognize a loss when we believe the loss is both probable and reasonably estimable. Based on the information available to us relating to these legal proceedings and/or our experience in similar legal proceedings, we do not believe the ultimate resolution of these proceedings, either individually or in the aggregate, will have a material adverse effect on our consolidated financial position, results of operations, or cash flow. However, our assessment may change depending upon the development of these legal proceedings, and the final results of these legal proceedings cannot be predicted with certainty. If we do not prevail in one or more of these legal matters, and the associated realized losses exceed our current estimates of the range of potential losses, our consolidated financial position, results of operations, or cash flows could be materially adversely affected in future periods.

16. Segment Reporting

We operate in one business segment within the hotel lodging industry: direct hotel investments. Direct hotel investments refers to owning hotel properties through either acquisition or new development. We report operating results of direct hotel investments on an aggregate basis as substantially all of our hotel investments have similar economic characteristics and exhibit similar long-term financial performance. As of September 30, 2021 and December 31, 2020, all of our hotel properties were in the U.S. and its territories.

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ITEM 2.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

As used in this Quarterly Report on Form 10-Q, unless the context otherwise indicates, the references to “we,” “us,” “our,” the “Company” or “Braemar” refer to Braemar Hotels & Resorts Inc., a Maryland corporation, and, as the context may require, its consolidated subsidiaries, including Braemar Hospitality Limited Partnership, a Delaware limited partnership, which we refer to as “our operating partnership” or “Braemar OP.” “Our TRSs” refers to our taxable REIT subsidiaries, including Braemar TRS Corporation, a Delaware corporation, which we refer to as “Braemar TRS,” and its subsidiaries, together with the two taxable REIT subsidiaries that lease our two hotels held in a consolidated joint venture and are wholly-owned by the joint venture and the U.S. Virgin Islands’ (“USVI”) taxable REIT subsidiary that owns The Ritz-Carlton St. Thomas hotel. “Ashford Trust” refers to Ashford Hospitality Trust, Inc., a Maryland corporation, and, as the context may require, its consolidated subsidiaries, including Ashford Hospitality Limited Partnership, a Delaware limited partnership and Ashford Trust’s operating partnership, which we refer to as “Ashford Trust OP.” “Ashford Inc.” refers to Ashford Inc., a Nevada corporation and, as the context may require, its consolidated subsidiaries. “Ashford LLC” or our “advisor” refers to Ashford Hospitality Advisors LLC, a Delaware limited liability company and a subsidiary of Ashford Inc. “Premier” refers to Premier Project Management LLC, a Maryland limited liability company and a subsidiary of Ashford LLC. “Remington Lodging” refers to Remington Lodging & Hospitality, LLC, a Delaware limited liability company and a hotel management company that was owned by Mr. Monty J. Bennett, chairman of our board of directors, and his father, Mr. Archie Bennett, Jr., chairman emeritus of Ashford Trust before its acquisition by Ashford Inc. on November 6, 2019. “Remington Hotels” refers to the same entity after the acquisition was completed resulting in Remington Lodging & Hospitality, LLC becoming a subsidiary of Ashford Inc.

This Quarterly Report on Form 10-Q (this “Form 10-Q”) contains registered trademarks that are the exclusive property of their respective owners, which are companies other than us, including Marriott International®, Hilton Worldwide®, Sofitel®, Hyatt® and Accor®.

FORWARD-LOOKING STATEMENTS

Throughout this Form 10-Q, we make forward-looking statements that are subject to risks and uncertainties. Forward-looking statements are generally identifiable by use of forward-looking terminology such as “may,” “will,” “should,” “potential,” “intend,” “expect,” “anticipate,” “estimate,” “approximately,” “believe,” “could,” “project,” “predict,” or other similar words or expressions. Additionally, statements regarding the following subjects are forward-looking by their nature:

•the impact of COVID-19 and numerous governmental travel restrictions and other orders on our business, including one or more possible recurrences of COVID-19 case surges causing state and local governments to reinstate travel restrictions;

•our business and investment strategy;

•our projected operating results and dividend rates;

•our ability to obtain future financing arrangements or restructure existing indebtedness;

•our understanding of our competition;

•market trends;

•projected capital expenditures;

•anticipated acquisitions or dispositions; and

•the impact of technology on our operations and business.

Such forward-looking statements are based on our beliefs, assumptions and expectations of our future performance taking into account all information currently known to us. These beliefs, assumptions, and expectations can change as a result of many potential events or factors, not all of which are known to us. If a change occurs, our business, financial condition, liquidity, results of operations, plans, and other objectives may vary materially from those expressed in our forward-looking statements. You should carefully consider this risk when you make an investment decision concerning our securities. Additionally, the following factors could cause actual results to vary from our forward-looking statements:

•the factors discussed in our Form 10-K for the year ended December 31, 2020, as filed with the Securities and Exchange Commission (the “SEC”) on March 5, 2021 (the “2020 10-K”), including those set forth under the sections entitled “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Business,” and “Properties;” and other filings under the Exchange Act;

•adverse effects of the COVID-19 pandemic, including a significant reduction in business and personal travel and travel restrictions in regions where our hotels are located, and one or more possible recurrences of COVID-19 case surges

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causing a further reduction in business and personal travel and potential reinstatement of travel restrictions by state or local governments;

•our ability to raise sufficient capital and/or take other actions to improve our liquidity position or otherwise meet our liquidity requirements;

•actions by our lenders to accelerate loan balances and foreclose on the hotel properties that are security for our loans if we are unable to make debt service payments or satisfy our other obligations under the forbearance agreements;

•general volatility of the capital markets and the market price of our common and preferred stock;

•general business and economic conditions affecting the lodging and travel industry;

•changes in our business or investment strategy;

•availability, terms and deployment of capital;

•unanticipated increases in financing and other costs, including a rise in interest rates;

•changes in our industry and the markets in which we operate, interest rates, or local economic conditions;

•the degree and nature of our competition;

•actual and potential conflicts of interest with Ashford Trust, Ashford Inc. and its subsidiaries (including Ashford LLC, Remington Hotels and Premier) and our executive officers and our non-independent director;

•changes in personnel of Ashford LLC or the lack of availability of qualified personnel;

•changes in governmental regulations, accounting rules, tax rates and similar matters;

•our ability to implement effective internal controls to address the material weakness identified in this report;

•the timing or outcome of the SEC investigation;

•legislative and regulatory changes, including changes to the Internal Revenue Code of 1986, as amended (the “Code”) and related rules, regulations and interpretations governing the taxation of REITs;

•limitations imposed on our business and our ability to satisfy complex rules in order for us to qualify as a REIT for U.S. federal income tax purposes; and

•future sales and issuances of our common stock or other securities might result in dilution and could cause the price of our common stock to decline.

When considering forward-looking statements, you should keep in mind the matters summarized under “Item 1A. Risk Factors” in Part I of our 2020 10-K and this Form 10-Q, and the discussion in this Management’s Discussion and Analysis of Financial Condition and Results of Operations, could cause our actual results and performance to differ significantly from those contained in our forward-looking statements. Additionally, many of these risks and uncertainties are currently amplified by and will continue to be amplified by, or in the future may be amplified by, the COVID-19 outbreak and the numerous government travel restrictions imposed in response thereto. The extent to which COVID-19 impacts us will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the scope, severity and duration of the pandemic, the actions taken to contain the pandemic or mitigate its impact, and the direct and indirect economic effects of the pandemic and containment measures, among others. Accordingly, we cannot guarantee future results or performance. Readers are cautioned not to place undue reliance on any of these forward-looking statements, which reflect our views as of the date of this Form 10-Q. Furthermore, we do not intend to update any of our forward-looking statements after the date of this Form 10-Q to conform these statements to actual results and performance, except as may be required by applicable law.

Overview

We are a Maryland corporation formed in April 2013 that invests primarily in high revenue per available room (“RevPAR”), luxury hotels and resorts. High RevPAR, for purposes of our investment strategy, means RevPAR of at least twice the then-current U.S. national average RevPAR for all hotels as determined by Smith Travel Research. Two times the U.S. national average was $91 for the year ended December 31, 2020. We have elected to be taxed as a REIT under the Code. We conduct our business and own substantially all of our assets through our operating partnership, Braemar OP.

We operate in the direct hotel investment segment of the hotel lodging industry. As of September 30, 2021, we owned interests in 14 hotel properties in six states, the District of Columbia and St. Thomas, U.S. Virgin Islands with 3,865 total rooms, or 3,630 net rooms, excluding those attributable to our joint venture partner. The hotel properties in our current portfolio are predominantly located in U.S. urban markets and resort locations with favorable growth characteristics resulting from multiple demand generators. We own 12 of our hotel properties directly, and the remaining two hotel properties through an investment in a majority-owned consolidated entity.

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We are advised by Ashford LLC, a subsidiary of Ashford Inc., through an advisory agreement. All of the hotel properties in our portfolio are currently asset-managed by Ashford LLC. We do not have any employees. All of the services that might be provided by employees are provided to us by Ashford LLC.

We do not operate any of our hotel properties directly; instead we employ hotel management companies to operate them for us under management contracts. As of September 30, 2021, Remington Hotels, a subsidiary of Ashford Inc., managed four of our 14 hotel properties. Third-party management companies managed the remaining hotel properties.

Ashford Inc. also provides other products and services to us or our hotel properties through certain entities in which Ashford Inc. has an ownership interest. These products and services include, but are not limited to design and construction services, debt placement and related services, broker-dealer and distribution services, audio visual services, real estate advisory services, insurance claims services, hypoallergenic premium rooms, watersport activities, travel/transportation services and mobile key technology.

Mr. Monty J. Bennett is chairman and chief executive officer of Ashford Inc. and, together with Mr. Archie Bennett, Jr., as of September 30, 2021, owned approximately 609,413 shares of Ashford Inc. common stock, which represented an approximate 20.2% ownership interest in Ashford Inc., and owned 18,758,600 shares of Ashford Inc. Series D Convertible Preferred Stock, which was exercisable (at an exercise price of $117.50 per share) into an additional approximate 3,991,191 shares of Ashford Inc. common stock, which if exercised as of September 30, 2021 would have increased the Bennetts’ ownership interest in Ashford Inc. to 65.6%; provided that prior to August 8, 2023, the voting power of the holders of the Ashford Inc. Series D Convertible Preferred Stock is limited to 40% of the combined voting power of all of the outstanding voting securities of the Ashford Inc. entitled to vote on any given matter. The 18,758,600 shares of Ashford Inc. Series D Convertible Preferred Stock owned by Mr. Monty J. Bennett and Mr. Archie Bennett, Jr. include 360,000 shares owned by trusts.

As of September 30, 2021, Mr. Monty J. Bennett, chairman of our board of directors and his father, Mr. Archie Bennett, Jr., together owned approximately 4,234,775 shares of our common stock (including common units, long-term incentive plan (“LTIP”) units and performance LTIP units), which represented an approximate 5.9% ownership in the Company.

COVID-19, Management’s Plans and Liquidity

In December 2019, COVID-19 was identified in Wuhan, China, subsequently spread to other regions of the world, and has resulted in significant travel restrictions and extended shutdown of numerous businesses throughout the United States. In March 2020, the World Health Organization declared COVID-19 to be a global pandemic. Beginning in late February 2020, we experienced a significant decline in occupancy and RevPAR associated with COVID-19 as we experienced significant reservation cancellations as well as a significant reduction in new reservations. The prolonged presence of the virus has resulted in health and other government authorities imposing widespread restrictions on travel and other businesses.

As of September 30, 2021, the Company maintained unrestricted cash of $195.5 million and restricted cash of $44.8 million. For the nine months ended September 30, 2021, cash flows provided by operating activities was approximately $55.1 million. The vast majority of the restricted cash comprises lender and manager held reserves. At the end of the quarter, there was also $20.4 million due to the Company from third-party hotel managers, which is primarily the Company’s cash held by one of its property managers which is also available to fund hotel operating costs. On December 10, 2020, the Company announced that it plans to continue its suspension of the common stock dividend into 2021 to protect liquidity and will evaluate future dividend declarations on a quarterly basis going forward.

We cannot predict when hotel operating levels will return to normalized levels after the effects of the pandemic fully subside, whether our hotels will be forced to shut down operations or whether one or more possible recurrences of COVID-19 case surges could result in further reductions in business and personal travel or potentially cause state and local governments to reinstate travel restrictions. Facts and circumstances could change in the future that are outside of management’s control, such as additional government mandates, health official orders, travel restrictions and extended business shutdowns due to COVID-19.

Recent Developments

On July 12, 2021, the Company entered into a second equity distribution agreement with Virtu to sell from time to time shares of our common stock having an aggregate offering price of up to $100 million (the “Virtu July 2021 EDA”). We will pay Virtu a commission of approximately 1.0% of the gross sales price of the shares of our common stock sold. The Company may also sell some or all of the shares of our common stock to Virtu as principal for its own account at a price agreed upon at the time of sale. As of November 3, 2021, the Company has sold approximately 4.7 million shares of common stock under the Virtu July 2021 EDA and received proceeds of approximately $24.0 million.

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On July 12, 2021, the Company made an additional investment in OpenKey of approximately $117,000.

On August 5, 2021, the Company acquired a 100% interest in the 138-room Mr. C Beverly Hills Hotel and five luxury residences adjacent to the hotel. The total consideration consisted of $10.0 million of cash, 2.5 million Braemar OP common units with a fair value of approximately $13.2 million and 500,000 warrants for the purchase of Braemar common stock with a $6.00 strike price and a fair value of approximately $1.5 million. Additionally, the Company assumed a $50.0 million mortgage loan, with a fair value of approximately $49.8 million. Upon closing, the Company repaid $20.0 million of the assumed mortgage loan.

On September 23, 2021, the Company finalized an extension of its mortgage loans for the Bardessono Hotel and Spa with a final maturity in August 2022 and the Hotel Yountville with a final maturity in May 2022. Each of the loans was extended for one year beyond its original maturity on the same terms as the original loan.

Key Indicators of Operating Performance

We use a variety of operating and other information to evaluate the operating performance of our business. These key indicators include financial information that is prepared in accordance with GAAP as well as other financial measures that are non-GAAP measures. In addition, we use other information that may not be financial in nature, including statistical information and comparative data. We use this information to measure the operating performance of our individual hotels, groups of hotels and/or business as a whole. We also use these metrics to evaluate the hotels in our portfolio and potential acquisitions to determine each hotel’s contribution to cash flow and its potential to provide attractive long-term total returns. These key indicators include:

•Occupancy. Occupancy means the total number of hotel rooms sold in a given period divided by the total number of rooms available. Occupancy measures the utilization of our hotels’ available capacity. We use occupancy to measure demand at a specific hotel or group of hotels in a given period.

•ADR. ADR means average daily rate and is calculated by dividing total hotel rooms revenues by total number of rooms sold in a given period. ADR measures average room price attained by a hotel and ADR trends provide useful information concerning the pricing environment and the nature of the customer base of a hotel or group of hotels. We use ADR to assess the pricing levels that we are able to generate.

•RevPAR. RevPAR means revenue per available room and is calculated by multiplying ADR by the average daily occupancy. RevPAR is one of the commonly used measures within the hotel industry to evaluate hotel operations. RevPAR does not include revenues from food and beverage sales or parking, telephone or other non-rooms revenues generated by the property. Although RevPAR does not include these ancillary revenues, it is generally considered the leading indicator of core revenues for many hotels. We also use RevPAR to compare the results of our hotels between periods and to analyze results of our comparable hotels (comparable hotels represent hotels we have owned for the entire period). RevPAR improvements attributable to increases in occupancy are generally accompanied by increases in most categories of variable operating costs. RevPAR improvements attributable to increases in ADR are generally accompanied by increases in limited categories of operating costs, such as management fees and franchise fees.

RevPAR changes that are primarily driven by changes in occupancy have different implications for overall revenues and profitability than changes that are driven primarily by changes in ADR. For example, an increase in occupancy at a hotel would lead to additional variable operating costs (including housekeeping services, utilities and room supplies) and could also result in increased other operating department revenue and expense. Changes in ADR typically have a greater impact on operating margins and profitability as they do not have a substantial effect on variable operating costs.

Occupancy, ADR and RevPAR are commonly used measures within the lodging industry to evaluate operating performance. RevPAR is an important statistic for monitoring operating performance at the individual hotel level and across our entire business. We evaluate individual hotel RevPAR performance on an absolute basis with comparisons to budget and prior periods, as well as on a regional and company-wide basis. ADR and RevPAR include only rooms revenue. Rooms revenue is dictated by demand (as measured by occupancy), pricing (as measured by ADR) and our available supply of hotel rooms.

We also use funds from operations (“FFO”), Adjusted FFO, earnings before interest, taxes, depreciation and amortization for real estate (“EBITDAre”) and Adjusted EBITDAre as measures of the operating performance of our business. See “Non-GAAP Financial Measures.”

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RESULTS OF OPERATIONS

Three Months Ended September 30, 2021 Compared to Three Months Ended September 30, 2020

The following table summarizes changes in key line items from our condensed consolidated statements of operations for the three months ended September 30, 2021 and 2020 (in thousands except percentages):

	Three Months Ended September 30,				Favorable (Unfavorable)
	2021		2020		$ Change		% Change
Revenue
Rooms	$	77,560	$	28,118	$	49,442	175.8	%
Food and beverage	24,494		8,537		15,957		186.9
Other	14,123		8,099		6,024		74.4
Total revenue	116,177		44,754		71,423		159.6
Expenses
Hotel operating expenses:
Rooms	17,072		7,975		(9,097)		(114.1)
Food and beverage	20,252		7,994		(12,258)		(153.3)
Other expenses	36,124		20,516		(15,608)		(76.1)
Management fees	3,595		1,321		(2,274)		(172.1)
Total hotel operating expenses	77,043		37,806		(39,237)		(103.8)
Property taxes, insurance and other	12,622		6,929		(5,693)		(82.2)
Depreciation and amortization	18,284		18,507		223		1.2
Advisory services fee	4,809		4,575		(234)		(5.1)
Transaction costs	275		—		(275)
Corporate general and administrative	2,094		1,405		(689)		(49.0)
Total expenses	115,127		69,222		(45,905)		(66.3)
Gain (loss) on insurance settlement and disposition of assets	—		10,149		(10,149)
Operating income (loss)	1,050		(14,319)		15,369		107.3
Equity in earnings (loss) of unconsolidated entity	(68)		(58)		(10)		(17.2)
Interest income	13		12		1		8.3
Other income (expense)	—		(3,604)		3,604		100.0
Interest expense and amortization of loan costs	(8,364)		(8,859)		495		5.6
Write-off of loan costs and exit fees	(432)		(1,335)		903		67.6
Unrealized gain (loss) on derivatives	142		3,561		(3,419)		(96.0)
Income (loss) before income taxes	(7,659)		(24,602)		16,943		68.9
Income tax (expense) benefit	(560)		1,545		(2,105)		(136.2)
Net income (loss)	(8,219)		(23,057)		14,838		64.4
(Income) loss attributable to noncontrolling interest in consolidated entities	450		1,999		(1,549)		(77.5)
Net (income) loss attributable to redeemable noncontrolling interests in operating partnership	823		2,381		(1,558)		(65.4)
Net income (loss) attributable to the Company	$	(6,946)	$	(18,677)	$	11,731	62.8	%

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All hotel properties owned for the three months ended September 30, 2021 and 2020 have been included in our results of operations during the respective periods in which they were owned. Based on when a hotel property was acquired or disposed of, operating results for certain hotel properties are not comparable for the three months ended September 30, 2021 and 2020. The hotel properties listed below are not comparable hotel properties for the periods indicated and all other hotel properties are considered comparable hotel properties. The following acquisitions and dispositions affect reporting comparability related to our condensed consolidated financial statements:

Hotel Properties	Location	Acquisition/Disposition	Acquisition/Disposition Date
Mr. C Beverly Hills Hotel	Los Angeles, CA	Acquisition	August 5, 2021

The following table illustrates the key performance indicators of all hotel properties owned for the periods indicated:

	Three Months Ended September 30,
	2021			2020
Occupancy	61.64		%	26.88		%
ADR (average daily rate)	$	357.99		$	304.68
RevPAR (revenue per available room)	$	220.66		$	81.89
Rooms revenue (in thousands)	$	77,560		$	28,118
Total hotel revenue (in thousands)	$	116,177		$	44,754

The following table illustrates the key performance indicators of the 13 hotel properties that were included for the full three months ended September 30, 2021 and 2020:

	Three Months Ended September 30,
	2021			2020
Occupancy	61.81		%	26.88		%
ADR (average daily rate)	$	358.25		$	304.68
RevPAR (revenue per available room)	$	221.43		$	81.89
Rooms revenue (in thousands)	$	76,027		$	28,118
Total hotel revenue (in thousands)	$	113,905		$	44,754

Net Income (Loss) Attributable to the Company. Net loss attributable to the Company decreased $11.7 million, from $18.7 million for the three months ended September 30, 2020 (the “2020 quarter”) to $6.9 million for the three months ended September 30, 2021 (the “2021 quarter”), as a result of the factors discussed below.

Rooms Revenue. Rooms revenue increased $49.4 million, or 175.8%, to $77.6 million during the 2021 quarter compared to the 2020 quarter. During the 2021 quarter, we experienced a 3,476 basis point increase in occupancy and a 17.5% increase in room rates. The increase in rooms revenue is primarily due to the hotel properties recovering from the COVID-19 pandemic as well as an increase of $1.5 million associated with the acquisition of the Mr. C Beverly Hills Hotel on August 5, 2021.

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Fluctuations in rooms revenue between the 2021 quarter and the 2020 quarter is a result of the changes in occupancy and ADR between the 2021 quarter and the 2020 quarter as reflected in the table below (dollars in thousands):

Hotel Property	Favorable (Unfavorable)
	Rooms Revenue		Occupancy (change in bps)	ADR (change in %)
Comparable
Capital Hilton (1)	$	2,145	2,698	21.7	%
Marriott Seattle Waterfront	5,850		6,315	34.0	%
The Notary Hotel	2,823		3,169	10.9	%
The Clancy (2)	5,185		7,469	n/a
Sofitel Chicago Magnificent Mile	3,527		3,243	45.9	%
Pier House Resort & Spa	3,367		1,978	78.8	%
The Ritz-Carlton St. Thomas	8,693		3,763	73.6	%
Park Hyatt Beaver Creek Resort & Spa	2,436		3,893	15.2	%
Hotel Yountville	2,942		3,455	42.0	%
The Ritz-Carlton Sarasota	3,267		1,189	39.2	%
Hilton La Jolla Torrey Pines	3,644		2,465	62.4	%
Bardessono Hotel and Spa	3,722		2,834	53.2	%
The Ritz-Carlton Lake Tahoe	307		(908)	26.2	%
Total	$	47,908	3,493	17.5	%
Non-comparable
Mr. C Beverly Hills Hotel	$	1,534	n/a	n/a

_______________

(1) The hotel was closed from April 2020 through mid-August 2020.

(2) The hotel was being renovated through September 30, 2020.

Food and Beverage Revenue. Food and beverage revenue increased $16.0 million, or 186.9%, to $24.5 million during the 2021 quarter compared to the 2020 quarter. This increase is attributable to an aggregate increase at all comparable hotel properties of $15.4 million as they are recovering from the COVID-19 pandemic, as well as an increase of $553,000 resulting from the acquisition of the Mr. C Beverly Hills Hotel on August 5, 2021.

Other Hotel Revenue. Other hotel revenue, which consists mainly of condo management fees, health center fees, resort fees, golf, telecommunications, parking and rentals and business interruption revenue, increased $6.0 million, or 74.4%, to $14.1 million during the 2021 quarter compared to the 2020 quarter. The increase is attributable to an aggregate increase in other hotel revenue of $5.8 million at 13 comparable hotel properties and an increase of $186,000 at the Mr. C Beverly Hills Hotel.

Rooms Expense. Rooms expense increased $9.1 million, or 114.1%, to $17.1 million in the 2021 quarter compared to the 2020 quarter. This increase is primarily attributable to an aggregate increase of $8.8 million at 12 comparable hotel properties as they are recovering from the COVID-19 pandemic and an increase of $410,000 at the Mr. C Beverly Hills Hotel, partially offset by a decrease of $113,000 at the Capital Hilton.

Food and Beverage Expense. Food and beverage expense increased $12.3 million, or 153.3%, to $20.3 million during the 2021 quarter compared to the 2020 quarter. This increase is attributable to an aggregate increase of $11.8 million at all comparable hotel properties and an increase of $455,000 at the Mr. C Beverly Hills Hotel.

Other Operating Expenses. Other operating expenses increased $15.6 million, or 76.1%, to $36.1 million in the 2021 quarter compared to the 2020 quarter. Hotel operating expenses consist of direct expenses from departments associated with revenue streams and indirect expenses associated with support departments and incentive management fees.

We experienced an increase of $2.2 million in direct expenses and $13.4 million in indirect expenses and incentive management fees in the 2021 quarter as compared to the 2020 quarter as the hotel properties are recovering from the COVID-19 pandemic. Direct expenses were 4.4% of total hotel revenue in the 2021 quarter and 6.4% in the 2020 quarter. The increase in direct expenses is primarily attributable to higher occupancy levels at all of our comparable hotel properties as they are recovering from the COVID-19 pandemic and an increase of approximately $13,000 at the Mr. C Beverly Hills Hotel.

The increase in indirect expenses comprises increases in: (i) general and administrative costs of $4.6 million comprising an increase of $4.3 million at our 13 comparable hotel properties and $294,000 at the Mr. C Beverly Hills Hotel; (ii) marketing

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costs of $3.8 million comprising an increase of $3.6 million at our 13 comparable hotel properties and $181,000 at the Mr. C Beverly Hills Hotel; (iii) repairs and maintenance of $1.8 million, comprising an increase of $1.7 million at our 13 comparable hotel properties and $79,000 at the Mr. C Beverly Hills Hotel; (iv) lease expense of $825,000 comprising an increase of $820,000 at our 13 comparable hotel properties and $5,000 at the Mr. C Beverly Hills Hotel; (v) energy costs of $1.2 million comprising an increase of $1.0 million at our 13 comparable hotel properties and $153,000 at the Mr. C Beverly Hills Hotel; and (vi) incentive management fees of $1.2 million comprising an increase of $1.2 million at our 13 comparable hotel properties and $22,000 at the Mr. C Beverly Hills Hotel.

Management Fees. Base management fees increased $2.3 million, or 172.1%, to $3.6 million in the 2021 quarter compared to the 2020 quarter at all of our comparable hotel properties as a result of the recovery from the COVID-19 pandemic and an increase of $67,000 at the Mr. C Beverly Hills Hotel.

Property Taxes, Insurance and Other. Property taxes, insurance and other increased $5.7 million, or 82.2%, to $12.6 million in the 2021 quarter compared to the 2020 quarter. The increase comprised an aggregate increase of approximately $5.9 million at six hotel properties. Approximately $5.3 million of the increase is primarily attributable to higher current year assessments at two hotel properties. The increase also includes an increase of $209,000 at the Mr. C Beverly Hills Hotel, partially offset by an aggregate decrease of approximately $314,000 at seven hotel properties.

Depreciation and Amortization. Depreciation and amortization decreased $223,000, or 1.2%, to $18.3 million in the 2021 quarter compared to the 2020 quarter. The decrease is comprised of an aggregate decrease of approximately $959,000 at eight comparable hotel properties, partially offset by an aggregate increase of $363,000 at The Clancy, Hotel Yountville, The Ritz-Carlton St. Thomas, The Ritz-Carlton Sarasota and The Ritz-Carlton Lake Tahoe as well as an increase of $373,000 at the Mr. C Beverly Hills Hotel.

Advisory Services Fee. Advisory services fee increased $234,000, or 5.1%, to $4.8 million in the 2021 quarter compared to the 2020 quarter due to increases in the base advisory fee of $372,000, reimbursable expenses of $290,000 and equity-based compensation of $1.2 million, partially offset by a decrease in incentive fee of $1.6 million.

In the 2021 quarter, we recorded an advisory services fee of $4.8 million, which included a base advisory fee of $2.8 million, reimbursable expenses of $694,000, $3.0 million associated with equity grants of our common stock and LTIP units awarded to the officers and employees of Ashford Inc. and a credit to incentive fee of $1.6 million.

In the 2020 quarter, we recorded an advisory services fee of $4.6 million, which included a base advisory fee of $2.4 million, reimbursable expenses of $404,000 and $1.8 million associated with equity grants of our common stock and LTIP units awarded to the officers and employees of Ashford Inc.

Transaction Costs. In the 2021 quarter, we recognized transactions costs of $275,000 associated with the acquisition of the Mr. C Beverly Hills Hotel. There were no transaction costs in the 2020 quarter.

Corporate General and Administrative. Corporate general and administrative expense was $2.1 million in the 2021 quarter and $1.4 million in the 2020 quarter. The increase in corporate general and administrative expense is due to higher professional fees of $226,000, higher public company costs of $225,000 and an increase of $414,000 related to our share of the reimbursed operating expenses of Ashford Securities, partially offset by lower miscellaneous expenses of $176,000.

Gain (Loss) on Insurance Settlement and Disposition of Assets. In the 2020 quarter, we recognized a gain of $10.1 million as a result of finalizing the insurance settlement from Hurricane Irma.

Equity in Earnings (Loss) of Unconsolidated Entity. In the 2021 quarter and 2020 quarter, we recorded equity in loss of unconsolidated entity of $68,000 and $58,000, respectively, related to our investment in OpenKey.

Interest Income. Interest income increased $1,000, or 8.3%, to $13,000 for the 2021 quarter.

Other Income (Expense). Other expense was $3.6 million in 2020 quarter compared to $0 in the 2021 quarter. In the 2020 quarter, we recorded a realized loss of $3.5 million on interest rate floors and expense of $64,000 related to CMBX premiums and interest paid on collateral.

Interest Expense and Amortization of Loan Costs. Interest expense and amortization of loan costs decreased $495,000, or 5.6%, to $8.4 million in the 2021 quarter compared to the 2020 quarter. The decrease is primarily due to lower interest expense from a lower average LIBOR rate, a credit to interest expense related to the amortization of default interest and late charges recorded on loans that were previously in default and the repayment of our secured term loan. These decreases were partially offset by higher interest expense associated with our Convertible Senior Notes and the mortgage loan associated with the Mr. C

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Beverly Hills Hotel acquisition. The average LIBOR rates in the 2021 quarter and the 2020 quarter were 0.09% and 0.16%, respectively.

Write-off of Loan Costs and Exit Fees. Write-off of loan costs and exit fees was $432,000 in the 2021 quarter, primarily associated with the $419,000 write-off of loan costs upon the $20 million pay-down of the mortgage loan assumed with the Mr. C Beverly Hills Hotel acquisition.

Write-off of loan costs and exit fees was $1.3 million in the 2020 quarter, resulting from amendments executed with various lenders, which included deferral of debt service payments and allowed the use of reserves for property-level operating shortfalls and/or to cover debt service payments. Third-party fees incurred in conjunction with these amendments, totaling $1.3 million, were expensed in accordance with applicable accounting guidance.

Unrealized Gain (Loss) on Derivatives. Unrealized gain on derivatives of $142,000 in the 2021 quarter consisted of an unrealized gain of approximately $190,000 on warrants, partially offset by an unrealized loss of approximately $48,000 on interest rate caps.

Unrealized gain on derivatives of $3.6 million in the 2020 quarter consisted of a $3.5 million unrealized gain on interest rate floors associated with the recognition of realized losses from the expiration of interest rate floors and a $51,000 unrealized gain on CMBX credit default swaps, partially offset by a $30,000 unrealized loss on interest rate caps.

Income Tax (Expense) Benefit. Income tax (expense) benefit changed $2.1 million, from an income tax benefit of $1.5 million in the 2020 quarter to income tax expense of $560,000 in the 2021 quarter. This change was primarily due to an increase in the profitability of our TRS entities in the 2021 quarter compared to the 2020 quarter.

(Income) Loss Attributable to Noncontrolling Interest in Consolidated Entities. Our noncontrolling interest partner in consolidated entities was allocated a loss of $450,000 and $2.0 million in the 2021 quarter and the 2020 quarter, respectively. At both September 30, 2021 and 2020, noncontrolling interest in consolidated entities represented an ownership interest of 25% in two hotel properties held by one entity.

Net (Income) Loss Attributable to Redeemable Noncontrolling Interests in Operating Partnership. Noncontrolling interests in operating partnership were allocated a net loss of $823,000 and $2.4 million in the 2021 quarter and the 2020 quarter, respectively. Redeemable noncontrolling interests in Braemar OP represented ownership interests of 8.35% and 10.08% as of September 30, 2021 and 2020, respectively.

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Nine Months Ended September 30, 2021 Compared to Nine Months Ended September 30, 2020

The following table summarizes changes in key line items from our condensed consolidated statements of operations for the nine months ended September 30, 2021 and 2020 (in thousands except percentages):

	Nine Months Ended September 30,				Favorable (Unfavorable)
	2021		2020		$ Change		% Change
Revenue
Rooms	$	195,720	$	105,119	$	90,601	86.2	%
Food and beverage	60,976		39,417		21,559		54.7
Other	40,439		30,633		9,806		32.0
Total hotel revenue	297,135		175,169		121,966		69.6
Expenses
Hotel operating expenses:
Rooms	41,569		29,300		(12,269)		(41.9)
Food and beverage	50,526		35,544		(14,982)		(42.2)
Other expenses	98,143		75,585		(22,558)		(29.8)
Management fees	9,079		5,664		(3,415)		(60.3)
Total hotel operating expenses	199,317		146,093		(53,224)		(36.4)
Property taxes, insurance and other	27,076		21,833		5,243		(24.0)
Depreciation and amortization	54,881		55,398		(517)		(0.9)
Gain on legal settlement	(989)		—		989
Advisory services fee	16,343		14,545		(1,798)		(12.4)
Transaction costs	571		—		(571)
Corporate general and administrative	6,077		4,850		(1,227)		(25.3)
Total expenses	303,276		242,719		(60,557)		(24.9)
Gain (loss) on insurance settlement and disposition of assets	696		10,149		(9,453)		(93.1)
Operating income (loss)	(5,445)		(57,401)		51,956		90.5
Equity in earnings (loss) of unconsolidated entity	(198)		(138)		(60)		(43.5)
Interest income	34		165		(131)		(79.4)
Other income (expense)	—		(3,806)		3,806		100.0
Interest expense and amortization of loan costs	(22,346)		(38,167)		15,821		41.5
Write-off of loan costs and exit fees	(1,960)		(3,572)		1,612		45.1
Unrealized gain (loss) on derivatives	64		3,748		(3,684)		(98.3)
Income (loss) before income taxes	(29,851)		(99,171)		69,320		69.9
Income tax (expense) benefit	(766)		4,622		(5,388)		(116.6)
Net income (loss)	(30,617)		(94,549)		63,932		67.6
(Income) loss attributable to noncontrolling interest in consolidated entities	2,546		4,975		2,429		48.8
Net (income) loss attributable to redeemable noncontrolling interests in operating partnership	3,184		10,036		6,852		68.3
Net income (loss) attributable to the Company	$	(24,887)	$	(79,538)	$	54,651	68.7	%

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All hotel properties owned for the nine months ended September 30, 2021 and 2020 have been included in our results of operations during the respective periods in which they were owned. Based on when a hotel property was acquired or disposed of, operating results for certain hotel properties are not comparable for the nine months ended September 30, 2021 and 2020. The hotel properties listed below are not comparable hotel properties for the periods indicated and all other hotel properties are considered comparable hotel properties. The following acquisitions and dispositions affect reporting comparability related to our condensed consolidated financial statements:

Hotel Properties	Location	Acquisition/Disposition	Acquisition/Disposition Date
Mr. C Beverly Hills Hotel	Los Angeles, CA	Acquisition	August 5, 2021

The following table illustrates the key performance indicators of all hotel properties for the periods indicated:

	Nine Months Ended September 30,
	2021			2020
Occupancy	49.46		%	31.11		%
ADR (average daily rate)	$	385.28		$	330.77
RevPAR (revenue per available room)	$	190.58		$	102.90
Rooms revenue (in thousands)	$	195,720		$	105,119
Total hotel revenue (in thousands)	$	297,135		$	175,169

The following table illustrates the key performance indicators of the 13 hotel properties that were included for the full nine months ended September 30, 2021 and 2020:

	Nine Months Ended September 30,
	2021			2020
Occupancy	49.42		%	31.11		%
ADR (average daily rate)	$	385.63		$	330.77
RevPAR (revenue per available room)	$	190.60		$	102.90
Rooms revenue (in thousands)	$	194,187		$	105,119
Total hotel revenue (in thousands)	$	294,863		$	175,169

Net Income (Loss) Attributable to the Company. Net loss attributable to the Company decreased $54.7 million, from $79.5 million for the nine months ended September 30, 2020 (the “2020 period”), to $24.9 million for the nine months ended September 30, 2021 (the “2021 period”), as a result of the factors discussed below.

Rooms Revenue. Rooms revenue increased $90.6 million, or 86.2%, to $195.7 million during the 2021 period compared to the 2020 period. During the 2021 period, we experienced a 1,835 basis point increase in occupancy and a 16.5% increase in room rates compared to the 2020 period. The increase in rooms revenue is due to the hotel properties recovering from the COVID-19 pandemic as well as an increase of $1.5 million associated with the acquisition of the Mr. C Beverly Hills Hotel on August 5, 2021.

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Fluctuations in rooms revenue between the 2021 period and the 2020 period is a result of the changes in occupancy and ADR between the 2021 period and the 2020 period as reflected in the table below (dollars in thousands):

Hotel Property	Favorable (Unfavorable)
	Rooms Revenue		Occupancy (change in bps)	ADR (change in %)
Comparable
Capital Hilton (1)	$	(1,146)	449	(30.8)	%
Marriott Seattle Waterfront	6,159		2,517	9.1	%
The Notary Hotel	1,480		666	(0.5)	%
The Clancy (2)	1,615		2,832	(47.3)	%
Sofitel Chicago Magnificent Mile	4,970		1,305	43.4	%
Pier House Resort & Spa	9,294		3,320	25.2	%
The Ritz-Carlton St. Thomas	29,939		4,786	50.8	%
Park Hyatt Beaver Creek Resort & Spa	2,103		2,326	(28.4)	%
Hotel Yountville	5,606		2,722	40.0	%
The Ritz-Carlton Sarasota	14,270		2,465	30.0	%
Hilton La Jolla Torrey Pines	3,928		1,505	8.7	%
Bardessono Hotel and Spa	7,693		2,741	45.2	%
The Ritz-Carlton Lake Tahoe	3,156		1,249	(3.8)	%
Total	$	89,067	1,831	16.5	%
Non-comparable
Mr. C Beverly Hills Hotel	$	1,534	n/a	n/a

_______________

(1) The hotel was closed from April 2020 through mid-August in 2020.

(2) The hotel was being renovated through September 30, 2020.

Food and Beverage Revenue. Food and beverage revenue increased $21.6 million, or 54.7%, to $61.0 million during the 2021 period compared to the 2020 period. This increase is primarily driven by the recovery from the COVID-19 pandemic. We experienced an aggregate increase in food and beverage revenue of $24.3 million at ten comparable hotel properties as well as an increase of $553,000 at the Mr. C Beverly Hills Hotel. These increases were partially offset by an aggregate decrease of $3.3 million at Capital Hilton, Hilton La Jolla Torrey Pines and The Notary Hotel.

Other Hotel Revenue. Other hotel revenue, which consists mainly of condo management fees, health center fees, resort fees, golf, telecommunications, parking, rentals and business interruption revenue, increased $9.8 million, or 32.0%, to $40.4 million during the 2021 period compared to the 2020 period.

The increase is attributable to higher other hotel revenue of $14.0 million at 11 comparable hotel properties and an increase of $186,000 at the Mr. C Beverly Hills Hotel, partially offset by an aggregate decrease of $381,000 at The Clancy and Capital Hilton as well as lower business interruption revenue of $4.0 million.

During the 2020 period, we recognized business interruption revenue of $4.0 million at The Ritz-Carlton St. Thomas as a result of Hurricane Irma. There was no such revenue recorded in the 2021 period.

Rooms Expense. Rooms expense increased $12.3 million, or 41.9%, to $41.6 million in the 2021 period compared to the 2020 period. The increase is attributable to an aggregate increase in rooms expense of $12.7 million at 12 comparable hotel properties and an increase of $410,000 at the Mr. C Beverly Hills Hotel, partially offset by a decrease of $791,000 at the Capital Hilton.

Food and Beverage Expense. Food and beverage expense increased $15.0 million, or 42.2%, to $50.5 million during the 2021 period compared to the 2020 period.

The increase is attributable to an aggregate increase of $18.0 million at nine comparable hotel properties and an increase of $455,000 at the Mr. C Beverly Hills Hotel, partially offset by an aggregate decrease of $3.5 million at the Capital Hilton, The Notary Hotel, Hilton La Jolla Torrey Pines and Marriott Seattle Waterfront.

Other Operating Expenses. Other operating expenses increased $22.6 million, or 29.8%, to $98.1 million in the 2021 period compared to the 2020 period. Hotel operating expenses consist of direct expenses from departments associated with revenue streams and indirect expenses associated with support departments and incentive management fees. We experienced an

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increase of $5.4 million in direct expenses and $17.2 million in indirect expenses and incentive management fees in the 2021 period compared to the 2020 period.

Direct expenses were 5.1% of total hotel revenue in the 2021 period and 5.6% in the 2020 period. The increase in direct expenses is associated with higher revenues as all of our comparable hotel properties are recovering from the COVID-19 pandemic and an increase of 13,000 at the Mr. C Beverly Hills Hotel.

The increase in indirect expenses is attributable to increases in (i) general and administrative costs of $2.0 million comprising an increase of $1.7 million at our 13 comparable hotel properties and $294,000 at the Mr. C Beverly Hills Hotel; (ii) marketing costs of $3.7 million comprising an increase of $3.5 million at our 13 comparable hotel properties and $181,000 at the Mr. C Beverly Hills Hotel; (iii) repairs and maintenance of $3.3 million comprising an increase of $3.2 million at our 13 comparable hotel properties and $79,000 at the Mr. C Beverly Hills Hotel; (iv) lease expense of $667,000 comprising an increase of $662,000 at our 13 comparable hotel properties and $5,000 at the Mr. C Beverly Hills Hotel; (v) energy costs of $2.5 million comprised of an increase of $2.4 million at our 13 comparable hotel properties and $153,000 at the Mr. C Beverly Hills Hotel; and (vi) incentive management fees of $5.0 million comprising an increase of $5.0 million at our 13 comparable hotel properties and $22,000 at the Mr. C Beverly Hills Hotel.

Management Fees. Base management fees increased $3.4 million, or 60.3%, to $9.1 million in the 2021 period compared to the 2020 period. Management fees increased $3.6 million at eleven comparable hotel properties and $67,000 at the Mr. C Beverly Hills Hotel, partially offset be an aggregate decrease of approximately $200,000 at the Capital Hilton and The Clancy.

Property Taxes, Insurance and Other. Property taxes, insurance and other increased $5.2 million, or 24.0%, to $27.1 million in the 2021 period compared to the 2020 period. The increase is comprised of an aggregate increase of approximately $5.7 million at nine hotel properties. Approximately $4.9 million of the increase is primarily attributable to higher current year assessments at two hotel properties. The increase also includes $209,000 at the Mr. C Beverly Hills Hotel. These increases were partially offset by an aggregate decrease of approximately $489,000 at four hotel properties.

Depreciation and Amortization. Depreciation and amortization decreased $517,000, or 0.9%, to $54.9 million for the 2021 period compared to the 2020 period. The decrease is comprised of an aggregate decrease of $2.7 million at eight comparable hotel properties, partially offset by an increase of $373,000 at the Mr. C Beverly Hills Hotel and an aggregate increase of $1.8 million at The Clancy, Hotel Yountville, The Ritz-Carlton St. Thomas, The Ritz-Carlton Sarasota and The Ritz-Carlton Lake Tahoe.

Advisory Services Fee. Advisory services fee increased $1.8 million, or 12.4%, to $16.3 million in the 2021 period compared to the 2020 period due to increases in the base advisory fee of $402,000, reimbursable expenses of $336,000, as well as an increase in equity-based compensation of $1.1 million.

In the 2021 period, we recorded an advisory services fee of $16.3 million, which included a base advisory fee of $8.0 million, reimbursable expenses of $1.7 million, $6.7 million associated with equity grants of our common stock and LTIP units awarded to the officers and employees of Ashford Inc.

In the 2020 period, we recorded an advisory services fee of $14.5 million, which included a base advisory fee of $7.6 million, reimbursable expenses of $1.4 million and $5.6 million associated with equity grants of our common stock and LTIP units awarded to the officers and employees of Ashford Inc.

Gain on Legal Settlement. In the 2021 period, we recognized a gain of $800,000 related to the settlement of a transfer tax matter with the City of San Francisco and $189,000 related to a billing dispute. In the 2020 period, there was no such gain recognized.

Transaction costs. In the 2021 period, we recognized $571,000 of transaction costs associated with the acquisition of the Mr. C Beverly Hills Hotel. There were no transaction costs in the 2020 period.

Corporate General and Administrative. Corporate general and administrative expense was $6.1 million in the 2021 period and $4.9 million in the 2020 period. The increase in corporate general and administrative expenses is primarily due to higher miscellaneous expenses of $45,000, an increase of $946,000 related to our share of the reimbursed operating expenses of Ashford Securities and higher public company costs of $457,000, partially offset by lower professional fees of $222,000.

Gain (loss) on Insurance Settlement and Disposition of Assets. In the 2020 period, we recognized a gain of $10.1 million as a result of finalizing the insurance settlement from Hurricane Irma. In the 2021 period, we recognized a gain of $481,000 associated with proceeds received from an insurance claim, a gain of $18,000 upon disposition of certain fixed assets as well as a gain of $197,000 associated with the sale of certain ERFP assets to Ashford Inc.

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Equity in Earnings (Loss) of Unconsolidated Entity. In the 2021 period and the 2020 period, we recorded equity in loss of unconsolidated entity of $198,000 and $138,000, respectively, related to our investment in OpenKey.

Interest Income. Interest income decreased $131,000, or 79.4%, to $34,000 for the 2021 period compared to the 2020 period.

Other Income (Expense). Other expense decreased $3.8 million, or 100.0% to $0 in the 2021 period compared to the 2020 period. In the 2020 period, we recorded a realized loss of $3.6 million on interest rate floors and expense of $191,000 related to CMBX premiums and interest paid on collateral.

Interest Expense and Amortization of Loan Costs. Interest expense and amortization of loan costs decreased $15.8 million, or 41.5%, to $22.3 million for the 2021 period compared to the 2020 period. The decrease is primarily due to lower interest expense from a lower average LIBOR rate, a credit to interest expense related to the amortization of default interest and late charges recorded on loans that were previously in default and the repayment of our secured term loan. These decreases were partially offset by higher interest expense from our Convertible Senior Notes and the mortgage loan associated with the Mr. C Beverly Hills Hotel acquisition. The average LIBOR rates for the 2021 period and the 2020 period were 0.10% and 0.64%, respectively.

Write-off of Loan Costs and Exit Fees. Write-off of loan costs and exit fees was $2.0 million in the 2021 period, primary associated with a $1.2 million write-off of unamortized loan costs upon the payoff of our secured term loan payoff and $351,000 from several amendments executed with various lenders, which included deferral of debt service payments and allowed the use of reserves for property-level operating shortfalls and/or to cover debt service payments. Third-party fees incurred in conjunction with these amendments, totaling $351,000, were expensed in accordance with applicable accounting guidance. In addition, there was approximately a $419,000 write-off of loan costs upon the $20 million pay-down of the mortgage loan assumed with the acquisition of the Mr. C Beverly Hills Hotel.

Write-off of loan costs and exit fees was $3.6 million for the 2020 period, resulting from several amendments executed with various lenders, which included deferral of debt service payments and allowed the use of reserves for property-level operating shortfalls and/or to cover debt service payments. Third-party fees incurred in conjunction with these amendments, totaling $3.6 million, were expensed in accordance with applicable accounting guidance.

Unrealized Gain (Loss) on Derivatives. Unrealized gain on derivatives of $64,000 for the 2021 period consisted of an unrealized gain of approximately $190,000 on warrants, partially offset by an unrealized loss of approximately $126,000 on interest rate caps.

Unrealized gain on derivatives of $3.7 million for the 2020 period consisted of a $3.6 million unrealized gain on interest rate floors associated with the recognition of realized losses from the expiration of interest rate floors and a $226,000 unrealized gain on CMBX credit default swaps and partially offset by an unrealized loss of $93,000 on interest rate caps.

Income Tax (Expense) Benefit. Income tax expense changed $5.4 million, from an income tax benefit of $4.6 million in the 2020 period to income tax expense of $766,000 in the 2021 period. This change was primarily due to an increase in the profitability of our TRS entities in the 2021 period compared to the 2020 period.

(Income) Loss Attributable to Noncontrolling Interest in Consolidated Entities. Our noncontrolling interest partner in consolidated entities was allocated a loss of $2.5 million and $5.0 million for the 2021 period and the 2020 period, respectively. At both September 30, 2021 and 2020, noncontrolling interest in consolidated entities represented an ownership interest of 25% in two hotel properties held by one entity.

Net (Income) Loss Attributable to Redeemable Noncontrolling Interests in Operating Partnership. Noncontrolling interests in operating partnership were allocated a net loss of $3.2 million and $10.0 million for the 2021 period and the 2020 period, respectively. Redeemable noncontrolling interests represented ownership interests in Braemar OP of approximately 8.35% and 10.08% as of September 30, 2021 and 2020, respectively.

LIQUIDITY AND CAPITAL RESOURCES

COVID-19, Management’s Plans and Liquidity

In December 2019, COVID-19 was identified in Wuhan, China, subsequently spread to other regions of the world, and has resulted in significant travel restrictions and extended shutdown of numerous businesses throughout the United States. In March 2020, the World Health Organization declared COVID-19 to be a global pandemic. Beginning in late February 2020, we experienced a significant decline in occupancy and RevPAR associated with COVID-19 as we experienced significant

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reservation cancellations as well as a significant reduction in new reservations. The prolonged presence of the virus has resulted in health and other government authorities imposing widespread restrictions on travel and other businesses.

As of September 30, 2021, the Company maintained unrestricted cash of $195.5 million and restricted cash of $44.8 million. For the nine months ended September 30, 2021, cash flows provided by operating activities was approximately $55.1 million. The vast majority of the restricted cash comprises lender and manager held reserves. At the end of the quarter, there was also $20.4 million due to the Company from third-party hotel managers, which is primarily the Company’s cash held by one of its property managers which is also available to fund hotel operating costs. On December 10, 2020, the Company announced that it plans to continue its suspension of the common stock dividend into 2021 to protect liquidity and will evaluate future dividend declarations on a quarterly basis going forward.

We cannot predict when hotel operating levels will return to normalized levels after the effects of the pandemic fully subside, whether our hotels will be forced to shut down operations or whether one or more possible recurrences of COVID-19 case surges could result in further reductions in business and personal travel or potentially cause state and local governments to reinstate travel restrictions. Facts and circumstances could change in the future that are outside of management’s control, such as additional government mandates, health official orders, travel restrictions and extended business shutdowns due to COVID-19.

Our short-term liquidity requirements consist primarily of funds necessary to pay for operating expenses and other expenditures directly associated with our hotel properties, including:

•advisory fees payable to Ashford LLC;

•recurring maintenance necessary to maintain our hotel properties in accordance with brand standards;

•interest expense and scheduled principal payments on outstanding indebtedness, including our secured term loan (see “Contractual Obligations and Commitments”);

•distributions, if any, in the form of dividends on our common stock, necessary to qualify for taxation as a REIT;

•dividends on our preferred stock; and

•capital expenditures to improve our hotel properties.

We expect to meet our short-term liquidity requirements generally through net cash provided by operations, capital market activities and existing cash balances.

Pursuant to the advisory agreement between us and our advisor, we must pay our advisor on a monthly basis a base advisory fee, subject to a minimum base advisory fee. The minimum base advisory fee is equal to the greater of: (i) 90% of the base fee paid for the same month in the prior fiscal year; and (ii) 1/12th of the “G&A Ratio” for the most recently completed fiscal quarter multiplied by our total market capitalization on the last balance sheet date included in the most recent quarterly report on Form 10-Q or annual report on Form 10-K that we file with the SEC. Thus, even if our total market capitalization and performance decline, we will still be required to make payments to our advisor equal to the minimum base advisory fee, which could adversely impact our liquidity and financial condition.

Our long-term liquidity requirements consist primarily of funds necessary to pay for the costs of acquiring additional hotel properties and redevelopments, renovations, expansions and other capital expenditures that need to be made periodically with respect to our hotel properties and scheduled debt payments. We expect to meet our long-term liquidity requirements through various sources of capital, including future common and preferred equity issuances, existing working capital, net cash provided by operations, hotel mortgage indebtedness and other secured and unsecured borrowings. However, there are a number of factors that may have a material adverse effect on our ability to access these capital sources, including the current and ongoing effects of COVID-19 on our business and the hotel industry, the state of overall equity and credit markets, our degree of leverage, our unencumbered asset base and borrowing restrictions imposed by lenders (including as a result of any failure to comply with financial covenants in our existing and future indebtedness), general market conditions for REITs, our operating performance and liquidity and market perceptions about us. The success of our business strategy will depend, in part, on our ability to access these various capital sources. While management cannot provide any assurances, management believes that our cash flow from operations and our existing cash balances will be adequate to meet upcoming anticipated requirements for interest and principal payments on debt (excluding any potential final maturity principal payments), working capital, and capital expenditures for the next 12 months and dividends required to maintain our status as a REIT for U.S. federal income tax purposes.

Our hotel properties will require periodic capital expenditures and renovation to remain competitive. In addition, acquisitions, redevelopments or expansions of hotel properties may require significant capital outlays. We may not be able to fund such capital improvements solely from net cash provided by operations because we must distribute annually at least 90%

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of our REIT taxable income, determined without regard to the deductions for dividends paid and excluding net capital gains, to qualify and maintain our qualification as a REIT, and we are subject to tax on any retained income and gains. As a result, our ability to fund capital expenditures, acquisitions or hotel redevelopment through retained earnings is very limited. Consequently, we expect to rely heavily upon the availability of debt or equity capital for these purposes. If we are unable to obtain the necessary capital on favorable terms, or at all, our financial condition, liquidity, results of operations and prospects could be materially and adversely affected.

Certain of our loan agreements contain cash trap provisions that may be triggered if the performance of our hotel properties decline. When these provisions are triggered, substantially all of the profit generated by the hotel properties securing such loan is deposited directly into lockbox accounts and then swept into cash management accounts for the benefit of our various lenders. This could affect our liquidity and our ability to make distributions to our stockholders until such time that a cash trap is no longer in effect for such loan. These cash trap provisions have been triggered on some of our mortgage loans.

Equity Transactions

On December 5, 2017, our board of directors approved the stock repurchase program pursuant to which the board of directors granted a repurchase authorization to acquire shares of the Company’s common stock, par value $0.01 per share and preferred stock having an aggregate value of up to $50 million. The board of directors’ authorization replaced any previous repurchase authorizations. No shares were repurchased during the nine months ended September 30, 2021, pursuant to this authorization.

On December 11, 2017, we entered into equity distribution agreements with certain sales agents to sell from time to time shares of our common stock having an aggregate offering price of up to $50.0 million. Sales of shares of our common stock, if any, may be made in negotiated transactions or transactions that are deemed to be “at-the-market” offerings as defined in Rule 415 of the Securities Act, including sales made directly on the NYSE, the existing trading market for our common stock, or sales made to or through a market maker other than on an exchange or through an electronic communications network. We will pay each of the sales agents a commission, which in each case shall not be more than 2.0% of the gross sales price of the shares of our common stock sold through such sales agent. On July 7, 2020, we entered into a side letter (the “Side Letter”) with the sales agents pursuant to which we agreed to pay all reasonable documented out-of-pocket expenses, including the reasonable fees and disbursements of counsel incurred by the sales agents, in connection with the ongoing services contemplated by the equity distribution agreements (subject to a $75,000 cap on certain expenses incurred in June 2020). Pursuant to the Side Letter, the sales agents have agreed to reimburse us for up to $50,000 of such expenses, if the sales agents offer and sell an amount of our common stock with an aggregate offering price of $15,000,000, and have agreed to reimburse us for up to an additional $50,000 of such expenses, provided the sales agents offer and sell an amount of our common stock with an aggregate offering price of $30,000,000. As of November 3, 2021, the Company has sold approximately 7.4 million shares of common stock and received gross proceeds of approximately $30.8 million under this program.

On November 13, 2019, we filed an initial registration statement with the SEC, as amended on January 24, 2020, for shares of our non-traded Series E Redeemable Preferred Stock (the “Series E Preferred Stock”) and our non-traded Series M Redeemable Preferred Stock (the “Series M Preferred Stock”). The registration statement became effective on February 21, 2020, and contemplates the issuance and sale of up to 20,000,000 shares of Series E Preferred Stock or Series M Preferred Stock in a primary offering and up to 8,000,000 shares of Series E Preferred Stock or Series M Preferred Stock pursuant to a dividend reinvestment plan. On February 25, 2020, we filed our prospectus with the SEC. Ashford Securities, a subsidiary of Ashford Inc. serves as the dealer manager and wholesaler of the Series E Preferred Stock and Series M Preferred Stock. On April 2, 2021, the Company filed with the State Department of Assessments and Taxation of the State of Maryland (the “SDAT”) articles supplementary to the Company’s Articles of Amendment and Restatement that provided for: (i) reclassifying the existing 28,000,000 shares of Series E Preferred Stock and 28,000,000 shares of Series M Preferred Stock as unissued shares of preferred stock; (ii) reclassifying and designating 28,000,000 shares of the Company’s authorized capital stock as shares of the Series E Preferred Stock (the “Series E Articles Supplementary”); and (iii) reclassifying and designating 28,000,000 shares of the Company’s authorized capital stock as shares of the Series M Preferred Stock (the “Series M Articles Supplementary”). The Series E Articles Supplementary and Series M Articles Supplementary were filed to revise the preferred stock terms related to the dividend rate, our optional redemption right and certain other voting rights. The Company also caused its operating partnership to execute Amendment No. 5 to the Third Amended and Restated Agreement of Limited Partnership to amend the terms of its operating partnership agreement to conform to the terms of the Series E Articles Supplementary and Series M Articles Supplementary. As of November 3, 2021, the Company has issued approximately 459,000 shares of Series E Preferred Stock and received net proceeds of approximately $10.3 million and issued approximately 17,000 shares of Series M Preferred Stock and received net proceeds of approximately $408,000.

On December 4, 2019, we entered into equity distribution agreements with certain sales agents to sell from time to time shares of our 5.50% Series B Cumulative Convertible Preferred Stock (the “Series B Convertible Preferred Stock”) having an

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aggregate offering price of up to $40.0 million. Sales of shares of the Series B Convertible Preferred Stock may be made in negotiated transactions or transactions that are deemed to be “at-the-market” offerings as defined in Rule 415 of the Securities Act, including sales made directly on the NYSE, the existing trading market for the Series B Convertible Preferred Stock, or sales made to or through a market maker other than on an exchange or through an electronic communications network. We will pay each of the sales agents a commission, which in each case shall not be more than 2.0% of the gross sales price of the shares of the Series B Convertible Preferred Stock sold through such sales agents. Since the inception of the program, we issued approximately 63,000 shares of the Series B Convertible Preferred Stock through our “at-the-market” equity offering program resulting in gross proceeds of approximately $1.0 million before discounts and commissions to the selling agents of approximately $19,000.

On February 4, 2021, the Company entered into the SEDA, pursuant to which the Company will be able to sell the Commitment Amount at the Company’s request any time during the commitment period commencing on February 4, 2021, and terminating at the end of the Commitment Period. Other than with respect to the Initial Advance the shares sold to YA pursuant to the SEDA would be purchased at 95% of the Market Price and would be subject to certain limitations, including that YA could not purchase any shares that would result in it owning more than 4.99% of the Company’s common stock.

At any time during the Commitment Period the Company may require YA to purchase shares of the Company’s common stock by delivering an Advance Notice. The Company may deliver an Initial Advance for up to 1,200,000 Advance Shares. The Preliminary Purchase Price per share for such shares shall be 100% of the average daily VWAP for the 5 consecutive trading days immediately prior to the date of the Advance Notice.

Pursuant to the SEDA, we currently intend to use the net proceeds from any sale of the shares for working capital purposes, including the repayment of outstanding debt. There are no other restrictions on future financing transactions. The SEDA does not contain any right of first refusal, participation rights, penalties or liquidated damages. We are not required to pay any additional amounts to reimburse or otherwise compensate YA in connection with the transaction except for a $10,000 structuring fee. As of November 3, 2021, the Company has sold approximately 1.7 million shares of common stock and received proceeds of approximately $10.0 million under the SEDA.

From March 16, 2021 through November 3, 2021, Braemar entered into privately negotiated exchange agreements with certain holders of the Series B Convertible Preferred Stock in reliance on Section 3(a)(9) of the Securities Act. The Company agreed to exchange a total of approximately 2.0 million shares of its common stock for approximately 7.3 million shares of its Series B Convertible Preferred Stock.

On April 21, 2021, Braemar and Lincoln Park, entered into a purchase agreement, pursuant to which the Company may sell to Lincoln Park up to 8,893,565 shares of its common stock, par value $0.01 per share of the Company, from time to time during the term of the purchase agreement. The issuance of the common stock pursuant to the purchase agreement has been registered pursuant to the Company’s Registration Statement, and the related base prospectus included in the Registration Statement, as supplemented by a prospectus supplement filed with the SEC on April 21, 2021. Braemar and Lincoln Park also entered into a registration rights agreement, pursuant to which the Company agreed to maintain the effectiveness of the Registration Statement. As of November 3, 2021, the Company has issued approximately 766,000 shares of common stock for gross proceeds of approximately $4.2 million under the Purchase Agreement.

On May 25, 2021, the Company entered into an equity distribution agreement with Virtu Americas LLC (“Virtu”), to sell from time to time shares of our common stock having an aggregate offering price of up to $50 million (the “Virtu May 2021 EDA”). We will pay Virtu a commission of approximately 1.0% of the gross sales price of the shares of our common stock sold. The Company may also sell some or all of the shares of our common stock to Virtu as principal for its own account at a price agreed upon at the time of sale. As of November 3, 2021, the Company has sold approximately 8.3 million shares of common stock under the Virtu May 2021 EDA and received gross proceeds of approximately $50.0 million.

On July 12, 2021, the Company entered into a second equity distribution agreement with Virtu to sell from time to time shares of our common stock having an aggregate offering price of up to $100 million (the “Virtu July 2021 EDA”). We will pay Virtu a commission of approximately 1.0% of the gross sales price of the shares of our common stock sold. The Company may also sell some or all of the shares of our common stock to Virtu as principal for its own account at a price agreed upon at the time of sale. As of November 3, 2021, the Company has sold approximately 4.7 million shares of common stock under the Virtu July 2021 EDA and received gross proceeds of approximately $24.0 million.

Debt Transactions

In May 2021, the Company issued $86.25 million aggregate principal amount of 4.50% Convertible Senior Notes due June 2026 (the “Convertible Senior Notes”). The net proceeds from this offering of the Convertible Senior Notes were approximately $82.8 million after deducting the underwriting fees and other expenses paid by the Company.

The Convertible Senior Notes are governed by an indenture (the “Base Indenture”) between the Company and U.S. Bank National Association, as trustee. The Convertible Senior Notes bear interest at a rate of 4.50% per annum, payable semi-

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annually in arrears on June 1 and December 1 of each year, beginning on December 1, 2021. The Convertible Senior Notes will mature on June 1, 2026.

The Convertible Senior Notes are convertible at any time prior to the close of business on the business day immediately preceding the maturity date for cash, shares of the Company’s common stock or a combination of cash and shares of the Company’s common stock, at the election of the Company, based on an initial conversion rate of 157.7909 shares of the Company’s common stock per $1,000 principal amount of notes (equivalent to a conversion price of approximately $6.34 per share of common stock), subject to adjustment of the conversion rate under certain circumstances. In addition, following the occurrence of certain corporate events, if the Company provides notice of redemption or if it exercises its option to convert the Convertible Senior Notes, the Company will, in certain circumstances, increase the conversion rate for a holder that converts its Convertible Senior Notes in connection with such corporate event, such notice of redemption, or such issuer conversion option, as the case may be.

The Company may redeem the Convertible Senior Notes at the Company’s option, in whole or in part, on any business day on or after the date of issuance if the last reported sale price per share of the Company’s common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which the Company provides a notice of redemption at a redemption price equal to 100% of the principal amount of the Convertible Senior Notes to be redeemed subject to certain adjustments, plus accrued and unpaid interest to, but excluding, the redemption date.

On September 23, 2021, the Company finalized an extension of its mortgage loans for the Bardessono Hotel and Spa with a final maturity in August 2022 and the Hotel Yountville with a final maturity in May 2022. Each of the loans was extended for one year beyond its original maturity on the same terms as the original loan.

Sources and Uses of Cash

We had approximately $195.5 million and $78.6 million of cash and cash equivalents at September 30, 2021 and December 31, 2020, respectively.

We anticipate that our principal sources of funds to meet our cash requirements will include cash on hand, positive cash flow from operations and capital market activities.

Net Cash Flows Provided by (Used in) Operating Activities. Net cash flows provided by (used in) operating activities were $55.1 million and $(35.6) million for the nine months ended September 30, 2021 and 2020, respectively. Cash flows from operations were impacted by the COVID-19 pandemic and changes in hotel operations of our 13 comparable hotel properties as well the acquisition of the Mr. C Beverly Hills Hotel on August 5, 2021. Cash flows from operations are also impacted by the timing of working capital cash flows such as collecting receivables from hotel guests, paying vendors, settling with derivative counterparties, settling with related parties, settling with hotel managers and timing differences between the receipt of proceeds from business interruption insurance claims and the recognition of the related revenue.

Net Cash Flows Provided by (Used in) Investing Activities. For the nine months ended September 30, 2021, net cash flows used in investing activities were $23.7 million. These cash outflows were primarily attributable to $15.8 million of capital improvements made to various hotel properties, approximately $9.5 million associated with the acquisition of the Mr. C Beverly Hills Hotel, partially offset by proceeds of $1.8 million from the sale of certain ERFP assets to Ashford Inc.

For the nine months ended September 30, 2020, net cash flows used in investing activities were $18.9 million. These cash outflows were primarily attributable to $21.5 million of capital improvements made to various hotel properties offset by $2.5 million of insurance proceeds received related to the hurricanes.

Net Cash Flows Provided by (Used in) Financing Activities. For the nine months ended September 30, 2021, net cash flows provided by financing activities were $95.6 million. Cash inflows primarily consisted of net proceeds of $83.2 million from the issuance of our Convertible Senior Notes, $100.0 million from the issuance of common stock, $4.6 million from the issuance of preferred stock and contributions of $920,000 from a noncontrolling interest in consolidated entities. The cash inflows were partially offset by repayments of indebtedness of $83.8 million, $6.9 million of dividend and distribution payments and $1.9 million of payments for loan costs and fees.

For the nine months ended September 30, 2020, net cash flows provided by financing activities were $47.1 million. Cash inflows primarily consisted of borrowings on indebtedness of $109.3 million, net proceeds of $6.4 million from the “at-the-market” common stock offering and $474,000 from the issuance of preferred stock, partially offset by repayments on indebtedness of $46.0 million, $13.6 million of dividend and distribution payments, $6.5 million of payments for loan costs and fees associated with loan forbearance, and distributions of $2.6 million to a noncontrolling interest in consolidated entities.

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Dividend Policy. In December 2019, the board of directors approved our dividend policy for 2020, which stated our then-expectation to pay a quarterly dividend of $0.16 per share during 2020. As previously disclosed, the approval of our dividend policy did not commit our board of directors to declare future dividends with respect to any quantity or the amount thereof. On March 16, 2020, the Company and its board of directors announced a suspension of its previously disclosed 2020 common stock dividend policy. The Company did not pay a dividend on its common stock during any quarter of 2020. On December 10, 2020, the Company announced that it plans to continue its suspension of the common stock dividend into 2021 to protect liquidity and will evaluate future dividend declarations on a quarterly basis going forward. The board of directors will continue to review our dividend policy and make announcements with respect thereto.

Seasonality

Our properties’ operations historically have been seasonal as certain properties maintain higher occupancy rates during the summer months and some during the winter months. This seasonality pattern can cause fluctuations in our quarterly lease revenue under our percentage leases. Quarterly revenue also may be adversely affected by renovations and repositionings, our managers’ effectiveness in generating business and by events beyond our control, such as the COVID-19 pandemic and government-issued travel restrictions in response, extreme weather conditions, natural disasters, terrorist attacks or alerts, civil unrest, government shutdowns, airline strikes or reduced airline capacity, economic factors and other considerations affecting travel. To the extent that cash flows from operations and cash on hand are insufficient during any quarter due to temporary or seasonal fluctuations in lease revenue, we expect to utilize borrowings to fund distributions required to maintain our REIT status. However, we cannot make any assurances that we will make distributions in the future.

Contractual Obligations and Commitments

There have been no material changes, outside of the ordinary course of business, as of September 30, 2021 to contractual obligations specified in the table of contractual obligations included in the section “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our 2020 Form 10-K.

Off-Balance Sheet Arrangements

In the normal course of business, we may form or invest in partnerships or joint ventures. We evaluate each partnership and joint venture to determine whether the entity is a variable interest entity. If the entity is determined to be a VIE we assess whether we are the primary beneficiary and need to consolidate the entity. For further discussion see note 2 to our consolidated financial statements. We have no other off-balance sheet arrangements.

Critical Accounting Policies

The preparation of our consolidated financial statements in accordance with accounting principles generally accepted in the United States requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Our accounting policies that are critical or most important to understanding our financial condition and results of operations and that require management to make the most difficult judgments are described in the section “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our 2020 Form 10-K. There have been no material changes in these critical accounting policies.

Non-GAAP Financial Measures

The following non-GAAP presentations of EBITDA, EBITDAre, Adjusted EBITDAre, Funds From Operations (“FFO”) and Adjusted FFO are presented to help our investors evaluate our operating performance.

EBITDA is defined as net income (loss) before interest expense and amortization of loan costs, depreciation and amortization, income taxes, equity in (earnings) loss of unconsolidated entity and after the Company’s portion of EBITDA of OpenKey. In addition, we excluded impairment on real estate, (gain) loss on insurance settlement and disposition of assets and Company’s portion of EBITDAre of OpenKey from EBITDA to calculate EBITDA for real estate, or EBITDAre, as defined by NAREIT.

We then further adjust EBITDAre to exclude certain additional items such as amortization of favorable (unfavorable) contract assets (liabilities), transaction and conversion costs, write-off of loan costs and exit fees, legal, advisory and settlement costs, advisory services incentive fee, other/income expense, Company’s portion of adjustments to EBITDAre of OpenKey and non-cash items such as unrealized gain/ loss on derivatives and stock/unit-based compensation.

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We present EBITDA, EBITDAre and Adjusted EBITDAre because we believe they reflect more accurately the ongoing performance of our hotel assets and other investments and provide more useful information to investors as they are indicators of our ability to meet our future debt payment requirements, working capital requirements and they provide an overall evaluation of our financial condition. EBITDA, EBITDAre and Adjusted EBITDAre as calculated by us may not be comparable to EBITDA, EBITDAre and Adjusted EBITDAre reported by other companies that do not define EBITDA, EBITDAre and Adjusted EBITDAre exactly as we define the terms. EBITDA, EBITDAre and Adjusted EBITDAre do not represent cash generated from operating activities determined in accordance with GAAP, and should not be considered as an alternative to operating income or net income determined in accordance with GAAP as an indicator of performance or as an alternative to cash flows from operating activities as determined by GAAP as an indicator of liquidity.

The following table reconciles net income (loss) to EBITDA, EBITDAre and Adjusted EBITDAre (in thousands) (unaudited):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Net income (loss)	$	(8,219)	$	(23,057)	$	(30,617)	$	(94,549)
Interest expense and amortization of loan costs	8,364		8,859		22,346		38,167
Depreciation and amortization	18,284		18,507		54,881		55,398
Income tax expense (benefit)	560		(1,545)		766		(4,622)
Equity in (earnings) loss of unconsolidated entity	68		58		198		138
Company’s portion of EBITDA of OpenKey	(68)		(56)		(196)		(135)
EBITDA	18,989		2,766		47,378		(5,603)
(Gain) loss on insurance settlement and disposition of assets	—		(10,149)		(696)		(10,149)
EBITDAre	18,989		(7,383)		46,682		(15,752)
Amortization of favorable (unfavorable) contract assets (liabilities)	118		207		394		621
Transaction and conversion costs	980		517		2,148		1,128
Other (income) expense	—		3,604		—		3,806
Write-off of loan costs and exit fees	432		1,335		1,960		3,572
Unrealized (gain) loss on derivatives	(142)		(3,561)		(64)		(3,748)
Non-cash stock/unit-based compensation	3,044		2,006		7,265		6,039
Legal, advisory and settlement costs	107		142		(320)		1,168
Advisory services incentive fee	(1,637)		—		—		—
Company’s portion of adjustments to EBITDAre of OpenKey	1		1		7		6
Adjusted EBITDAre	$	21,892	$	(3,132)	$	58,072	$	(3,160)

55

FFO is calculated on the basis defined by NAREIT, which is net income (loss) attributable to common stockholders, computed in accordance with GAAP, excluding gains or losses on insurance settlement and disposition of assets, plus impairment charges on real estate, depreciation and amortization of real estate assets, and after redeemable noncontrolling interests in the operating partnership and adjustments for unconsolidated entities. NAREIT developed FFO as a relative measure of performance of an equity REIT to recognize that income-producing real estate historically has not depreciated on the basis determined by GAAP. Our calculation of Adjusted FFO excludes dividends on Series B Convertible Preferred Stock, gain/loss on extinguishment of preferred stock, transaction and conversion costs, write-off of loan costs and exit fees, legal, advisory and settlement costs, advisory services incentive fee, other income/expense and non-cash items such as interest expense on Convertible Senior Notes, interest expense accretion on refundable membership club deposits, amortization of loan costs, unrealized gain/loss on derivatives, stock/unit-based compensation and the Company’s portion of adjustments to FFO of OpenKey. FFO and Adjusted FFO exclude amounts attributable to the portion of a partnership owned by the third-party. We consider FFO and Adjusted FFO to be appropriate measures of our ongoing normalized operating performance as a REIT. We compute FFO in accordance with our interpretation of standards established by NAREIT, which may not be comparable to FFO reported by other REITs that either do not define the term in accordance with the current NAREIT definition or interpret the NAREIT definition differently than us. FFO and Adjusted FFO do not represent cash generated from operating activities as determined by GAAP and should not be considered as an alternative to GAAP net income or loss as an indication of our financial performance or GAAP cash flows from operating activities as a measure of our liquidity. FFO and Adjusted FFO are also not indicative of funds available to satisfy our cash needs, including our ability to make cash distributions. However, to facilitate a clear understanding of our historical operating results, we believe that FFO and Adjusted FFO should be considered along with our net income or loss and cash flows reported in our condensed consolidated financial statements.

56

The following table reconciles net income (loss) to FFO and Adjusted FFO (in thousands) (unaudited):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Net income (loss)	$	(8,219)	$	(23,057)	$	(30,617)	$	(94,549)
(Income) loss attributable to noncontrolling interest in consolidated entities	450		1,999		2,546		4,975
Net (Income) loss attributable to redeemable noncontrolling interests in operating partnership	823		2,381		3,184		10,036
Preferred dividends	(1,977)		(2,554)		(6,258)		(7,664)
Gain (loss) on extinguishment of preferred stock	(111)		—		(4,595)		—
Net income (loss) attributable to common stockholders	(9,034)		(21,231)		(35,740)		(87,202)
Depreciation and amortization on real estate (1)	17,619		17,791		52,843		53,142
Net income (loss) attributable to redeemable noncontrolling interests in operating partnership	(823)		(2,381)		(3,184)		(10,036)
Equity in (earnings) loss of unconsolidated entity	68		58		198		138
(Gain) loss on insurance settlement and disposition of assets	—		(10,149)		(696)		(10,149)
Company’s portion of FFO of OpenKey	(68)		(57)		(197)		(137)
FFO available to common stockholders and OP unitholders	7,762		(15,969)		13,224		(54,244)
Series B Convertible Preferred Stock dividends	1,058		1,729		3,689		5,189
(Gain) loss on extinguishment of preferred stock	111		—		4,595		—
Transaction and conversion costs	980		517		2,148		1,128
Other (income) expense	—		3,604		—		3,806
Interest expense on Convertible Senior Notes	1,361		—		2,010		—
Interest expense accretion on refundable membership club benefits	190		201		582		616
Write-off of loan costs and exit fees	432		1,335		1,960		3,572
Amortization of loan costs (1)	407		670		1,684		2,651
Unrealized (gain) loss on derivatives	(142)		(3,561)		(64)		(3,748)
Non-cash stock/unit-based compensation	3,044		2,006		7,265		6,039
Legal, advisory and settlement costs	107		142		(320)		1,168
Advisory services incentive fee	(1,637)		—		—		—
Company’s portion of adjustments to FFO of OpenKey	1		1		7		6
Adjusted FFO available to common stockholders, OP unitholders, Series B Cumulative Convertible preferred stockholders and convertible note holders on an “as converted” basis	$	13,674	$	(9,325)	$	36,780	$	(33,817)

____________________

(1)Net of adjustment for noncontrolling interest in consolidated entities. The following table presents the amounts of the adjustments for noncontrolling interests for each line item:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Depreciation and amortization on real estate	$	(665)	$	(716)	$	(2,038)	$	(2,256)
Amortization of loan costs	(22)		(19)		(65)		(56)

57

Hotel Properties

The following table presents certain information related to our hotel properties:

Hotel Property	Location	Total Rooms	% Owned		Owned Rooms
Fee Simple Properties
Capital Hilton	Washington, D.C.	550	75	%	413
Marriott Seattle Waterfront	Seattle, WA	361	100	%	361
The Notary Hotel	Philadelphia, PA	499	100	%	499
The Clancy	San Francisco, CA	410	100	%	410
Sofitel Chicago Magnificent Mile	Chicago, IL	415	100	%	415
Pier House Resort & Spa	Key West, FL	142	100	%	142
The Ritz-Carlton St. Thomas	St. Thomas, USVI	180	100	%	180
Park Hyatt Beaver Creek Resort & Spa	Beaver Creek, CO	190	100	%	190
Hotel Yountville	Yountville, CA	80	100	%	80
The Ritz-Carlton Sarasota	Sarasota, FL	266	100	%	266
The Ritz-Carlton Lake Tahoe (1)	Truckee, CA	170	100	%	170
Mr. C Beverly Hills Hotel (2)	Los Angeles, CA	143	100	%	143
Ground Lease Properties (3)
Hilton La Jolla Torrey Pines (4)	La Jolla, CA	394	75	%	296
Bardessono Hotel and Spa (5)	Yountville, CA	65	100	%	65
Total		3,865			3,630

________

(1)    The above information does not include the operations of ten condominium units not owned by The Ritz-Carlton Lake Tahoe.

(2)    Includes 138 hotel rooms and five residences adjacent to the hotel.

(3)    Some of our hotel properties are on land subject to ground leases, two of which cover the entire property.

(4)    The ground lease expires in 2067. The ground lease contains one extension option of either 10 or 20 years dependent upon capital investment spend during the lease term.

(5)    The initial ground lease expires in 2065. The ground lease contains two 25-year extension options, at our election.

ITEM 3.QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

Our primary market risk exposure consists of changes in interest rates on borrowings under our debt instruments that bear interest at variable rates that fluctuate with market interest rates. To the extent that we acquire assets or conduct operations in an international jurisdiction, we will also have currency exchange risk. We may enter into certain hedging arrangements in order to manage interest rate and currency fluctuations. The analysis below presents the sensitivity of the market value of our financial instruments to selected changes in market interest rates.

At September 30, 2021, our total indebtedness of approximately $1.2 billion included approximately $1.1 billion of variable-rate debt. The impact on the results of operations of a 25-basis point change in the interest rate on the outstanding balance of variable-rate debt at September 30, 2021, would be approximately $2.7 million per year. Interest rate changes have no impact on the remaining $116.3 million of fixed-rate debt.

The above amounts were determined based on the impact of hypothetical interest rates on our borrowings and assume no changes in our capital structure. The information presented above includes those exposures that existed at September 30, 2021, but it does not consider exposures or positions that could arise after that date. Accordingly, the information presented herein has limited predictive value. As a result, the ultimate realized gain or loss with respect to interest rate fluctuations will depend on exposures that arise during the period, the hedging strategies at the time, and the related interest rates.

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ITEM 4.CONTROLS AND PROCEDURES

Under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, our management has evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of September 30, 2021 (“Evaluation Date”). Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that, as of the Evaluation Date, our disclosure controls and procedures were effective (i) to ensure that information required to be disclosed in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC rules and forms; and (ii) to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosures.

There have been no changes in our internal controls over financial reporting during our most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

PART II. OTHER INFORMATION

ITEM 1.LEGAL PROCEEDINGS

On October 24, 2019, the Company provided notice to Accor of the material breach of its responsibilities under the Accor management agreement for the Sofitel Chicago Magnificent Mile at 20 East Chestnut Street in Chicago, Illinois. On November 7, 2019, Accor filed a complaint against Ashford TRS Chicago II in the Supreme Court of the State of New York, New York County, seeking a declaratory judgment that no breach has occurred. Accor’s complaint was dismissed on or about February 27, 2020. On January 6, 2020, Ashford TRS Chicago II filed a complaint against Accor in the Supreme Court of the State of New York, New York County, alleging breach of the Accor management agreement and seeking declaration of its right to terminate the Accor management agreement. On July 20, 2020, Accor filed an Amended Answer and Counterclaims against Ashford TRS Chicago II, Accor asserts two causes of action: First, Accor asserts a counterclaim for declaratory judgment that Accor correctly calculated the amount payable to Ashford TRS Chicago II under the management agreement to “cure” Accor’s performance test failure (the “Cure Amount”). Second, Accor asserts a counterclaim for breach of contract on the basis that Ashford TRS Chicago II breached the management agreement by wrongfully maintaining that the Cure Amount for the 2018 and 2019 Performance Test failure is $1,031,549 instead of $535,120. As of September 30, 2021, no amounts have been accrued.

One of the Company’s hotel management companies is currently involved in litigation regarding its employment policies and practices at multiple California hotels, including one of the Company’s hotels. The Company believes it is probable that the litigation will result in a loss due to a potential pre-trial settlement, in which case the Company estimates its potential loss will be approximately $500,000; however, it is entitled to indemnification for a portion of such loss. As of September 30, 2021, approximately $500,000 has been accrued.

In June 2020, each of the Company, Ashford Trust, Ashford Inc., and Lismore, a subsidiary of Ashford Inc. (collectively with the Company, Ashford Trust, Ashford Inc. and Lismore, the “Ashford Companies”), received an administrative subpoena from the SEC. The Company’s administrative subpoena requires the production of documents and other information since January 1, 2018 relating to, among other things, (1) related party transactions among the Ashford Companies (including the Lismore Agreement between the Company and Lismore pursuant to which the Company engaged Lismore to negotiate the refinancing, modification or forbearance of certain mortgage debt) or between any of the Ashford Companies and any officer, director or owner of the Ashford Companies or any entity controlled by any such person, and (2) the Company’s accounting policies, procedures, and internal controls related to such related party transactions. In addition, in October 2020, Mr. Monty J. Bennett, chairman of our board of directors, received an administrative subpoena from the SEC requiring testimony and the production of documents and other information substantially similar to the requests in the subpoenas received by the Ashford Companies. The Company and Mr. Monty J. Bennett are responding to the administrative subpoenas.

On December 20, 2016, a class action lawsuit was filed against one of the Company’s hotel management companies in the Superior Court of the State of California in and for the County of Contra Costa alleging violations of certain California employment laws, which class action affects two hotels owned by subsidiaries of the Company. The court has entered an order granting class certification with respect to: (1) a statewide class of non-exempt employees of our manager who were allegedly deprived of rest breaks as a result of our manager’s previous written policy requiring its employees to stay on premises during rest breaks; and (2) a derivative class of non-exempt former employees of our manager who were not paid for allegedly missed breaks upon separation from employment. Notices to potential class members were sent out on February 2, 2021. Potential class members had until April 4, 2021 to opt out of the class; however, the total number of employees in the class has not been definitively determined and is the subject of continuing discovery. While we believe it is reasonably possible that we may incur a loss associated with this litigation, because there remains uncertainty under California law with respect to a significant legal

59

issue, discovery relating to class members continues, and the trial judge retains discretion to award lower penalties than set forth in the applicable California employment laws, we do not believe any potential loss to the Company is reasonably estimable at this time. As of September 30, 2021, no amounts have been accrued.

As of September 30, 2021, the Company has an $800,000 receivable from Ashford Trust, included in Due from related parties, net. The receivable relates to a legal settlement between Ashford Trust and the City of San Francisco regarding a transfer tax matter associated with the transfer of The Clancy from Ashford Trust to Braemar upon Braemar’s 2013 spin-off from Ashford Trust. The transfer taxes were initially paid by Braemar at the time of the spin-off. The $800,000 gain is included in “(gain) loss on legal settlements” on the condensed consolidated statements of operations.

We are also engaged in other legal proceedings that have arisen but have not been fully adjudicated. To the extent the claims giving rise to these legal proceedings are not covered by insurance, they relate to the following general types of claims: employment matters, tax matters and matters relating to compliance with applicable law (for example, the ADA and similar state laws). The likelihood of loss from these legal proceedings is based on the definitions within contingency accounting literature. We recognize a loss when we believe the loss is both probable and reasonably estimable. Based on the information available to us relating to these legal proceedings and/or our experience in similar legal proceedings, we do not believe the ultimate resolution of these proceedings, either individually or in the aggregate, will have a material adverse effect on our consolidated financial position, results of operations, or cash flow. However, our assessment may change depending upon the development of these legal proceedings, and the final results of these legal proceedings cannot be predicted with certainty. If we do not prevail in one or more of these legal matters, and the associated realized losses exceed our current estimates of the range of potential losses, our consolidated financial position, results of operations, or cash flows could be materially adversely affected in future periods.

ITEM 1A.RISK FACTORS

The discussion of our business and operations should be read together with the risk factors contained in Item 1A to Part I of our Annual Report on Form 10-K for the fiscal year ended December 31, 2020, filed with the SEC, which describe various risks and uncertainties to which we are or may become subject. These risks and uncertainties have the potential to affect our business, financial condition, results of operations, cash flows, strategies, or prospects in a material and adverse manner. The risk factors set forth below update, and should be read together with, the risk factors described in our Annual Report on Form 10-K for the year ended December 31, 2020.

ITEM 2.UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Purchases of Equity Securities by the Issuer

On December 5, 2017, our board of directors reapproved the stock repurchase program pursuant to which the board of directors granted a repurchase authorization to acquire shares of the Company’s common stock, par value $0.01 per share having an aggregate value of up to $50 million. The board of director’s authorization replaced any previous repurchase authorizations. No shares were repurchased during the three and nine months ended September 30, 2021, pursuant to this authorization.

The following table provides the information with respect to purchases and forfeitures of our common stock during each of the months in the third quarter of 2021:

Period	Total Number of Shares Purchased		Average Price Paid Per Share		Total Number of Shares Purchased as Part of a Publicly Announced Plan	Maximum Dollar Value of Shares That May Yet Be Purchased Under the Plan
Common stock:
July 1 to July 31	1,354	(1)	$	—	—	$	50,000,000
August 1 to August 31	751	(1)	$	—	—	$	50,000,000
September 1 to September 30	4,903	(1)	$	—	—	$	50,000,000
Total	7,008		$	—	—

__________________

(1)There is no cost associated with the forfeiture of 1,354, 751 and 4,903 restricted shares of our common stock in July, August and September, respectively.

During the period between July 1, 2021 and September 30, 2021, the Company exchanged a total of 120,000 shares of its common stock for an aggregate of 30,000 shares of preferred stock with certain holders of its 5.50% Series B Cumulative

60

Convertible Preferred Stock. The issuance of the shares of the common stock was made by the Company pursuant to the exemption from the registration requirements of Section 3(a)(9) of the Securities Act on the basis that these offers constituted an exchange with existing holders of the Company’s securities. No commission or other remuneration was paid to any party for soliciting such exchange and the transactions did not involve a public offering. In consideration for the common stock issuances, the Company received shares of Series B Convertible Preferred Stock from the stockholders, which shares of preferred stock were cancelled and of no further effect.

ITEM 3.DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4.MINE SAFETY DISCLOSURES

None.

ITEM 5.OTHER INFORMATION

Amendments to Articles of Incorporation

As previously disclosed, on April 2, 2021, we filed with the SDAT the Series E Articles Supplementary and the Series M Articles Supplementary establishing the rights and preferences of the Series E Preferred Stock and the Series M Preferred Stock, respectively (together, the Series E Articles Supplementary and the Series M Articles Supplementary, the “Articles Supplementary”).

On November 4, 2021, we filed with the SDAT certificates of correction to the Articles Supplementary (together, the “Certificates of Correction”). The Certificates of Correction fix incorrect cross references contained in Section (7)(b)(v) of Article THIRD of the Articles Supplementary. The Certificates of Correction became effective upon filing. All terms of the Series E Preferred Stock and the Series M Preferred Stock (including, preferences, conversion or other rights, voting powers, restrictions, limitations as to dividends, qualifications, or terms or conditions of redemption) remain unchanged by the filing of the Certificates of Correction.

Copies of the Certificates of Correction are attached as Exhibit 3.10 and 3.11 to this Form 10-Q and are incorporated herein by reference.

ITEM 6.EXHIBITS

Exhibit	Description
1.1	Purchase Agreement, dated as of May 13, 2021, by and among the Company, the Operating Partnership, the Advisor and UBS Securities LLC, as the Initial Purchaser (incorporated by reference to Exhibit 1.1 to the Current Report on Form 8-K filed on May 18, 2021).
1.2	Equity Distribution Agreement, dated as of May 25, 2021, by and between Braemar Hotels & Resorts Inc. and Virtu Americas LLC (incorporated by reference to Exhibit 1.1 to the Current Report on Form 8-K filed on May 26, 2021).
1.3	Equity Distribution Agreement, dated as of July 12, 2021, by and among Braemar Hotels & Resorts Inc., Braemar Hospitality Limited Partnership, Ashford Hospitality Advisors LLC and Virtu Americas LLC (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on July 12, 2021).
3.1	Articles of Amendment and Restatement of Braemar Hotels & Resorts Inc. (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed on April 29, 2016).
3.2	Articles Supplementary of Braemar Hotels & Resorts Inc. (incorporated by reference to Exhibit 3.2 to the Current Report on Form 8-K filed on May 18, 2015).
3.3	Articles of Amendment of Braemar Hotels & Resorts Inc. (incorporated by reference to Exhibit 3.2 to the Current Report on Form 8-K filed on April 29, 2016).
3.4	Amendment Number One to the Articles of Amendment and Restatement of Braemar Hotels & Resorts Inc. (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed on December 8, 2017).
3.5	Amendment Number Two to Articles of Amendment and Restatement of Braemar Hotels & Resorts Inc. (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed on April 23, 2018).
3.6	Articles of Amendment of Braemar Hotels & Resorts Inc., accepted for record and certified by the SDAT on January 23, 2020 (incorporated by reference to Exhibit 3.13 to Amendment No. 1 to the Registration Statement on Form S-3 (File No. 333-234663) filed with the SEC on January 24, 2020).
3.7	Articles Supplementary Establishing the Series E Redeemable Preferred Stock of Braemar Hotels & Resorts Inc., accepted for record and certified by the SDAT on April 2, 2021 (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed on April 2, 2021).

61

Exhibit	Description
3.8	Articles Supplementary Establishing the Series M Redeemable Preferred Stock of Braemar Hotels & Resorts Inc., accepted for record and certified by the SDAT on April 2, 2021 (incorporated by reference to Exhibit 3.2 to the Current Report on Form 8-K filed on April 2, 2021).
3.9	Fourth Amended and Restated Bylaws of Braemar Hotels & Resorts Inc. (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed on August 20, 2018).
3.10*	Certificate of Correction of Series E Articles Supplementary of Braemar Hotels & Resorts Inc., accepted for record and certified by the SDAT on November 4, 2021.
3.11*	Certificate of Correction of Series M Articles Supplementary of Braemar Hotels & Resorts Inc., accepted for record and certified by the SDAT on November 4, 2021.
10.1	Amendment No. 2 to the Fifth Amended and Restated Advisory Agreement, dated as of August 16, 2021, by and among Braemar Hotels & Resorts Inc., Braemar Hospitality Limited Partnership, Braemar TRS Corporation, Ashford Inc. and Ashford Hospitality Advisors LLC (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on August 17, 2021).
31.1*	Certifications of Chief Executive Officer Pursuant to Rule 13a-14(a) and Rule 15d-14(a) of Securities Exchange Act of 1934, as amended.
31.2*	Certifications of Chief Financial Officer Pursuant to Rule 13a-14(a) and Rule 15d-14(a) of Securities Exchange Act of 1934, as amended.
32.1**	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2**	Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
99.1	Consulting and Cooperation Agreement, by and among Ashford Inc., Ashford Hospitality Advisors LLC, and Robert G. Haiman, dated as of June 30, 2021 (incorporated by reference to Exhibit 99.1 to the Current Report on Form 8-K filed on June 30, 2021).

The following materials from the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2021 are formatted in XBRL (Extensible Business Reporting Language): (i) Consolidated Balance Sheets; (ii) Consolidated Statements of Operations; (iii) Consolidated Statements Comprehensive Income; (iv) Consolidated Statements of Equity; (v) Consolidated Statements of Cash Flows; and (vi) Notes to the Consolidated Financial Statements. In accordance with Rule 402 of Regulation S-T, the XBRL related information in Exhibit 101 to this Quarterly Report on Form 10-Q shall not be deemed to be “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liability of that section, and shall not be part of any registration statement or other document filed under the Securities Act of 1933, as amended or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
101.INS	XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH	Inline XBRL Taxonomy Extension Schema Document	Submitted electronically with this report.
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document	Submitted electronically with this report.
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document	Submitted electronically with this report.
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document.	Submitted electronically with this report.
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document.	Submitted electronically with this report.
104	Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101)

___________________________________

* Filed herewith.

** Furnished herewith.

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SIGNATURES

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.

    BRAEMAR HOTELS & RESORTS INC.

Date:	November 5, 2021	By:	/s/ RICHARD J. STOCKTON
			Richard J. Stockton
			President and Chief Executive Officer
Date:	November 5, 2021	By:	/s/ DERIC S. EUBANKS
			Deric S. Eubanks
			Chief Financial Officer

63

EX-3.10

Exhibit 3.10

BRAEMAR HOTELS & RESORTS INC.

CERTIFICATE OF CORRECTION

OF

    ARTICLES SUPPLEMENTARY    

November 4, 2021

Braemar Hotels & Resorts Inc., a Maryland corporation (the “Corporation”), having its principal office in Baltimore City, Maryland and its corporate office in Dallas, Texas, certifies to the State Department of Assessments and Taxation of Maryland (the “Department”) that:

FIRST: The Corporation filed Articles Supplementary Establishing and Fixing the Rights and Preferences of a Series of Preferred Stock with the Department on April 2, 2021 (the “Series E Articles Supplementary”), which established the rights and preferences of the Series E Redeemable Preferred Stock, par value $0.01 per share, of the Corporation.

SECOND: Section (7)(b)(v) of Article THIRD of the Series E Articles Supplementary contains erroneous cross-references. The Series E Articles Supplementary are hereby corrected as follows:

(1)Section (7)(b)(v) of Article THIRD of the Series E Articles Supplementary as previously filed is as follows:

“(v) For the avoidance of doubt, if any amendment, alteration, repeal, merger or consolidation described above in Section 7(b)(iv)(ii) would adversely affect one or more but not all classes or series of preferred stock of the Corporation, then only the classes or series of preferred stock of the Corporation adversely affected and entitled to vote on such matter shall vote as a class in lieu of all other classes or series of preferred stock of the Corporation. In addition, so long as any shares of Series E Preferred Stock remain outstanding, the holders of the outstanding shares of Series E Preferred Stock also will have the exclusive right to vote on any amendment, alteration or repeal of the provisions of the Charter, including the articles supplementary establishing the Series E Preferred Stock, on which holders of Series E Preferred Stock are otherwise entitled to vote pursuant to Section 7(b)(vi)(ii) above that would alter only the contract rights, as expressly set forth in the Charter, of the Series E Preferred Stock, and the holders of any other classes or series of the capital stock of the Corporation will not be entitled to vote on such an amendment, alteration or repeal.”

(2)Section (7)(b)(v) of Article THIRD of the Series E Articles Supplementary as corrected is as follows:

“(v) For the avoidance of doubt, if any amendment, alteration, repeal, merger or consolidation described above in clause (ii) of the first sentence of Section 7(b)(iv) would adversely affect one or more but not all classes or series of preferred stock of the Corporation, then only the classes or series of preferred stock of the Corporation adversely affected and entitled to vote on such matter shall vote as a class in lieu of all other classes or series of preferred stock of the Corporation. In addition, so long as any shares of Series E Preferred Stock remain outstanding, the holders of the outstanding shares of Series E Preferred Stock also will have the exclusive right to vote on any amendment, alteration or repeal of the provisions of the Charter, including the articles supplementary establishing the Series E Preferred Stock, on which holders of Series E Preferred Stock are otherwise entitled to vote pursuant to clause (ii) of the first sentence of Section 7(b)(iv) above that would alter only the contract rights, as expressly set forth

EAST\186072908.3

in the Charter, of the Series E Preferred Stock, and the holders of any other classes or series of the capital stock of the Corporation will not be entitled to vote on such an amendment, alteration or repeal.”

    THIRD: This Certificate of Correction of Articles Supplementary has been prepared in accordance with the provisions of Section 1-207 of the Maryland General Corporation Law.

    FOURTH: The undersigned Chief Executive Officer and President of the Corporation acknowledges this Certificate of Correction of Articles Supplementary to be the act of the Corporation and, as to all matters or facts required to be verified under oath, the undersigned Chief Executive Officer and President acknowledges that to the best of his knowledge, information and belief, these matters and facts are true in all material respects and that this statement is made under the penalties for perjury.

[Remainder of page intentionally left blank]

2

EAST\186072908.3

IN WITNESS WHEREOF, the Corporation has caused this Certificate of Correction of Articles Supplementary to be executed in its name and on its behalf by its President and attested to by its Secretary as of the date first written above.

BRAEMAR HOTELS & RESORTS INC.
By:	/s/ Richard J. Stockton
	Name: Richard J. Stockton
	Title: Chief Executive Officer and President
ATTEST:
By:	/s/ Alex Rose
	Name: Alex Rose
	Title: Executive Vice President, General Counsel and Secretary

    [Signature Page to Certificate of Correction (Series E Articles Supplementary)]

EX-3.11

Exhibit 3.11

BRAEMAR HOTELS & RESORTS INC.

CERTIFICATE OF CORRECTION

OF

ARTICLES SUPPLEMENTARY

November 4, 2021

Braemar Hotels & Resorts Inc., a Maryland corporation (the “Corporation”), having its principal office in Baltimore City, Maryland and its corporate office in Dallas, Texas, certifies to the State Department of Assessments and Taxation of Maryland (the “Department”) that:

FIRST: The Corporation filed Articles Supplementary Establishing and Fixing the Rights and Preferences of a Series of Preferred Stock with the Department on April 2, 2021 (the “Series M Articles Supplementary”), which established the rights and preferences of the Series M Redeemable Preferred Stock, par value $0.01 per share, of the Corporation.

SECOND: Section (7)(b)(v) of Article THIRD of the Series M Articles Supplementary contains erroneous cross-references. The Series M Articles Supplementary are hereby corrected as follows:

(1)Section (7)(b)(v) of Article THIRD of the Series M Articles Supplementary as previously filed is as follows:

“(v) For the avoidance of doubt, if any amendment, alteration, repeal, merger or consolidation described above in Section 7(b)(iv)(ii) would adversely affect one or more but not all classes or series of preferred stock of the Corporation, then only the classes or series of preferred stock of the Corporation adversely affected and entitled to vote on such matter shall vote as a class in lieu of all other classes or series of preferred stock of the Corporation. In addition, so long as any shares of Series M Preferred Stock remain outstanding, the holders of the outstanding shares of Series M Preferred Stock also will have the exclusive right to vote on any amendment, alteration or repeal of the provisions of the Charter, including the articles supplementary establishing the Series M Preferred Stock, on which holders of Series M Preferred Stock are otherwise entitled to vote pursuant to Section 7(b)(vi)(ii) above that would alter only the contract rights, as expressly set forth in the Charter, of the Series M Preferred Stock, and the holders of any other classes or series of the capital stock of the Corporation will not be entitled to vote on such an amendment, alteration or repeal.”

(2)Section (7)(b)(v) of Article THIRD of the Series M Articles Supplementary as corrected is as follows:

“(v) For the avoidance of doubt, if any amendment, alteration, repeal, merger or consolidation described above in clause (ii) of the first sentence of Section 7(b)(iv) would adversely affect one or more but not all classes or series of preferred stock of the Corporation, then only the classes or series of preferred stock of the Corporation adversely affected and entitled to vote on such matter shall vote as a class in lieu of all other classes or series of preferred stock of the Corporation. In addition, so long as any shares of Series M Preferred Stock remain outstanding, the holders of the outstanding shares of Series M Preferred Stock also will have the exclusive right to vote on any amendment, alteration or repeal of the provisions of the Charter, including the articles supplementary establishing the Series M Preferred Stock, on which holders of Series M Preferred Stock are otherwise entitled to vote pursuant to clause (ii) of the first sentence of Section 7(b)(iv) above that would alter only the contract rights, as expressly set forth

EAST\186074045.2

in the Charter, of the Series M Preferred Stock, and the holders of any other classes or series of the capital stock of the Corporation will not be entitled to vote on such an amendment, alteration or repeal.”

    THIRD: This Certificate of Correction of Articles Supplementary has been prepared in accordance with the provisions of Section 1-207 of the Maryland General Corporation Law.

    FOURTH: The undersigned Chief Executive Officer and President of the Corporation acknowledges this Certificate of Correction of Articles Supplementary to be the act of the Corporation and, as to all matters or facts required to be verified under oath, the undersigned Chief Executive Officer and President acknowledges that to the best of his knowledge, information and belief, these matters and facts are true in all material respects and that this statement is made under the penalties for perjury.

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2

EAST\186074045.2

IN WITNESS WHEREOF, the Corporation has caused this Certificate of Correction of Articles Supplementary to be executed in its name and on its behalf by its President and attested to by its Secretary as of the date first written above.

BRAEMAR HOTELS & RESORTS INC.
By:	/s/ Richard J. Stockton
	Name: Richard J. Stockton
	Title: Chief Executive Officer and President
ATTEST:
By:	/s/ Alex Rose
	Name: Alex Rose
	Title: Executive Vice President, General Counsel and Secretary

    [Signature Page to Certificate of Correction (Series M Articles Supplementary)]

EX-31.1

EXHIBIT 31.1

CERTIFICATION

I, Richard J. Stockton, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Braemar Hotels & Resorts Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 5, 2021

/s/ RICHARD J. STOCKTON

Richard J. Stockton

President and Chief Executive Officer

EX-31.2

EXHIBIT 31.2

CERTIFICATION

I, Deric S. Eubanks, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Braemar Hotels & Resorts Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 5, 2021

/s/ DERIC S. EUBANKS

Deric S. Eubanks

Chief Financial Officer

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Braemar Hotels & Resorts Inc. (the “Company”) on Form 10-Q for the quarterly period ended September 30, 2021, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Richard J. Stockton, President and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

(1)The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: November 5, 2021

/s/ RICHARD J. STOCKTON

Richard J. Stockton

President and Chief Executive Officer

EX-32.2

EXHIBIT 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Braemar Hotels & Resorts Inc. (the “Company”) on Form 10-Q for the quarterly period ended September 30, 2021, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Deric S. Eubanks, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

(1)The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: November 5, 2021

/s/ DERIC S. EUBANKS

Deric S. Eubanks

Chief Financial Officer

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Cover Page - shares	9 Months Ended
	Sep. 30, 2021	Nov. 03, 2021
Document Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2021
Document Transition Report	false
Entity File Number	001-35972
Entity Registrant Name	BRAEMAR HOTELS & RESORTS INC.
Entity Incorporation, State or Country Code	MD
Entity Tax Identification Number	46-2488594
Entity Address, Address Line One	14185 Dallas Parkway
Entity Address, Address Line Two	Suite 1200
Entity Address, City or Town	Dallas
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	75254
City Area Code	972
Local Phone Number	490-9600
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		64,503,016
Entity Central Index Key	0001574085
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	Q3
Amendment Flag	false
Common Stock
Document Information [Line Items]
Title of 12(b) Security	Common Stock
Trading Symbol	BHR
Security Exchange Name	NYSE
Preferred Stock, Series B
Document Information [Line Items]
Title of 12(b) Security	Preferred Stock, Series B
Trading Symbol	BHR-PB
Security Exchange Name	NYSE
Preferred Stock, Series D
Document Information [Line Items]
Title of 12(b) Security	Preferred Stock, Series D
Trading Symbol	BHR-PD
Security Exchange Name	NYSE

XML

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2021	Dec. 31, 2020
ASSETS
Investments in hotel properties, gross	$ 1,847,755	$ 1,784,849
Accumulated depreciation	(395,753)	(360,259)
Investments in hotel properties, net	1,452,002	1,424,590
Cash and cash equivalents	195,517	78,606
Restricted cash	44,753	34,544
Accounts receivable, net of allowance of $126 and $227, respectively	17,317	13,557
Inventories	2,718	2,551
Prepaid expenses	4,297	4,405
Investment in unconsolidated entity	1,627	1,708
Derivative assets	74
Operating lease right-of-use assets	80,593	81,260
Other assets	14,439	14,898
Intangible assets, net	4,356	4,640
Due from related parties, net	1,910	991
Due from third-party hotel managers	20,390	12,271
Total assets	1,839,993	1,674,021
Liabilities:
Indebtedness, net	1,172,787	1,130,594
Accounts payable and accrued expenses	89,265	61,758
Dividends and distributions payable	2,112	2,736
Due to Ashford Inc.	820	2,772
Due to third-party hotel managers	1,665	1,393
Operating lease liabilities	60,876	60,917
Other liabilities	20,699	18,077
Derivative liabilities	1,338	0
Total liabilities	1,349,562	1,278,247
Commitments and contingencies (note 15)
Redeemable noncontrolling interests in operating partnership	39,948	27,655
Preferred stock, $0.01 value, 80,000,000 shares authorized:
8.25% Series D cumulative preferred stock, 1,600,000 shares issued and outstanding at September 30, 2021 and December 31, 2020	16	16
Common stock, $0.01 par value, 250,000,000 shares authorized, 63,974,117 and 38,274,770 shares issued and outstanding at September 30, 2021 and December 31, 2020, respectively	639	382
Additional paid-in capital	698,481	541,870
Accumulated deficit	(303,836)	(266,010)
Total stockholders’ equity of the Company	395,300	276,258
Noncontrolling interest in consolidated entities	(16,714)	(15,088)
Total equity	378,586	261,170
Total liabilities and equity	1,839,993	1,674,021
Series B Preferred Stock
Liabilities:
5.50% Series B cumulative convertible preferred stock, $0.01 par value, 3,078,017 and 5,031,473 shares issued and outstanding at September 30, 2021 and December 31, 2020	65,426	106,949
Series E Preferred Stock
Liabilities:
5.50% Series B cumulative convertible preferred stock, $0.01 par value, 3,078,017 and 5,031,473 shares issued and outstanding at September 30, 2021 and December 31, 2020	6,110	0
Series M Preferred Stock
Liabilities:
5.50% Series B cumulative convertible preferred stock, $0.01 par value, 3,078,017 and 5,031,473 shares issued and outstanding at September 30, 2021 and December 31, 2020	$ 361	$ 0

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CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended	12 Months Ended
	Sep. 30, 2021	Sep. 30, 2021	Dec. 31, 2020	Apr. 02, 2021
ASSETS
Allowance for doubtful notes receivable	$ 126	$ 126	$ 227
Preferred stock, $0.01 value, 80,000,000 shares authorized:
Preferred stock par value (in dollars per share)	$ 0.01	$ 0.01	$ 0.01
Preferred stock, shares authorized (in shares)	80,000,000	80,000,000	80,000,000
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	250,000,000	250,000,000	250,000,000
Common stock, shares issued (in shares)	63,974,117	63,974,117	38,274,770
Common stock, shares outstanding (in shares)	63,974,117	63,974,117	38,274,770
Series B Preferred Stock
Liabilities [Abstract]
Preferred stock dividend rate	5.50%	5.50%	5.50%
Series preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01	$ 0.01
Series B preferred stock, shares issued (in shares)	3,078,017	3,078,017	5,031,473
Series B preferred stock, shares outstanding (in shares)	3,078,017	3,078,017	5,031,473
Series E Preferred Stock
Liabilities [Abstract]
Series preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01	$ 0.01
Series B preferred stock, shares issued (in shares)	265,637	265,637	0
Series B preferred stock, shares outstanding (in shares)	265,637	265,637	0
Series M Preferred Stock
Liabilities [Abstract]
Preferred stock dividend rate		0.00082%
Series preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01	$ 0.01	$ 0.01
Series B preferred stock, shares issued (in shares)	14,644	14,644	0
Series B preferred stock, shares outstanding (in shares)	14,644	14,644	0
Series D Preferred Stock
Liabilities [Abstract]
Preferred stock dividend rate	8.25%	8.25%
Preferred stock, $0.01 value, 80,000,000 shares authorized:
Preferred stock, shares issued (in shares)	1,600,000	1,600,000	1,600,000
Preferred stock, shares outstanding (in shares)	1,600,000	1,600,000	1,600,000

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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
REVENUE
Total revenue	$ 116,177	$ 44,754	$ 297,135	$ 175,169
Hotel operating expenses:
Total hotel operating expenses	77,043	37,806	199,317	146,093
Property taxes, insurance and other	12,622	6,929	27,076	21,833
Depreciation and amortization	18,284	18,507	54,881	55,398
Advisory services fee	4,809	4,575	16,343	14,545
(Gain) loss on legal settlements	0	0	(989)	0
Transaction costs	275	0	571	0
Corporate general and administrative	2,094	1,405	6,077	4,850
Total expenses	115,127	69,222	303,276	242,719
Gain (loss) on insurance settlement and disposition of assets	0	10,149	696	10,149
OPERATING INCOME (LOSS)	1,050	(14,319)	(5,445)	(57,401)
Equity in earnings (loss) of unconsolidated entity	(68)	(58)	(198)	(138)
Interest income	13	12	34	165
Other income (expense)	0	(3,604)	0	(3,806)
Interest expense and amortization of discounts and loan costs	(8,364)	(8,859)	(22,346)	(38,167)
Write-off of loan costs and exit fees	(432)	(1,335)	(1,960)	(3,572)
Unrealized gain (loss) on derivatives	142	3,561	64	3,748
INCOME (LOSS) BEFORE INCOME TAXES	(7,659)	(24,602)	(29,851)	(99,171)
Income tax (expense) benefit	(560)	1,545	(766)	4,622
NET INCOME (LOSS)	(8,219)	(23,057)	(30,617)	(94,549)
(Income) loss attributable to noncontrolling interest in consolidated entities	450	1,999	2,546	4,975
Net (income) loss attributable to redeemable noncontrolling interests in operating partnership	823	2,381	3,184	10,036
NET INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY	(6,946)	(18,677)	(24,887)	(79,538)
Preferred dividends	(1,977)	(2,554)	(6,258)	(7,664)
Gain (loss) on extinguishment of preferred stock	(111)	0	(4,595)	0
NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCKHOLDERS	$ (9,034)	$ (21,231)	$ (35,740)	$ (87,202)
INCOME (LOSS) PER SHARE - BASIC:
Net income (loss) attributable to common stockholders (in dollars per share)	$ (0.15)	$ (0.63)	$ (0.73)	$ (2.63)
Weighted average common shares outstanding – basic (in shares)	59,207	33,923	48,954	33,103
INCOME (LOSS) PER SHARE - DILUTED:
Net income (loss) attributable to common stockholders (in dollars per share)	$ (0.15)	$ (0.63)	$ (0.73)	$ (2.63)
Weighted average common shares outstanding – diluted (in shares)	59,207	33,923	48,954	33,103
Total hotel revenue
REVENUE
Total revenue	$ 116,177	$ 44,754	$ 297,135	$ 175,169
Rooms
REVENUE
Total revenue	77,560	28,118	195,720	105,119
Hotel operating expenses:
Total hotel operating expenses	17,072	7,975	41,569	29,300
Food and beverage
REVENUE
Total revenue	24,494	8,537	60,976	39,417
Hotel operating expenses:
Total hotel operating expenses	20,252	7,994	50,526	35,544
Other hotel
REVENUE
Total revenue	14,123	8,099	40,439	30,633
Hotel operating expenses:
Total hotel operating expenses	36,124	20,516	98,143	75,585
Management fees
Hotel operating expenses:
Total hotel operating expenses	$ 3,595	$ 1,321	$ 9,079	$ 5,664

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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Statement of Comprehensive Income [Abstract]
NET INCOME (LOSS)	$ (8,219)	$ (23,057)	$ (30,617)	$ (94,549)
OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX
Total other comprehensive income (loss)	0	0	0	0
TOTAL COMPREHENSIVE INCOME (LOSS)	(8,219)	(23,057)	(30,617)	(94,549)
Comprehensive (income) loss attributable to noncontrolling interest in consolidated entities	450	1,999	2,546	4,975
Comprehensive (income) loss attributable to redeemable noncontrolling interests in operating partnership	823	2,381	3,184	10,036
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY	$ (6,946)	$ (18,677)	$ (24,887)	$ (79,538)

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CONDENSED CONSOLIDATED STATEMENTS OF EQUITY - USD ($)	Total	Series D Preferred Stock	Series B Preferred Stock	Series E Preferred Stock	Series M Preferred Stock	Preferred Stock Series D Preferred Stock	Common Stock	Additional Paid-in Capital	Accumulated Deficit	Accumulated Deficit Series D Preferred Stock	Accumulated Deficit Series B Preferred Stock	Accumulated Deficit Series E Preferred Stock	Accumulated Deficit Series M Preferred Stock	Noncontrolling Interest in Consolidated Entities	Redeemable Noncontrolling Interests in Operating Partnership
Increase (Decrease) in Temporary Equity [Roll Forward]
Units outstanding at beginning of year			5,008,000
Beginning balance (in shares) at Dec. 31, 2019						1,600,000	32,885,000
Beginning balance at Dec. 31, 2019	$ 363,254,000					$ 16,000	$ 329,000	$ 519,551,000	$ (150,629,000)					$ (6,013,000)	$ 41,570,000
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Purchase of common stock (in shares)							(36,000)
Purchase of common stock	(126,000)							(126,000)
Equity-based compensation	4,388,000							4,388,000							1,651,000
Issuance of common stock (in shares)							3,046,000
Issuance of common stock	6,410,000						$ 30,000	6,380,000
Issuance of restricted shares/units (in shares)							375,000
Issuance of restricted shares/units	0						$ 3,000	(3,000)
Forfeiture of restricted common shares (in shares)							(9,000)
Forfeiture of restricted common shares	0
Dividends declared – preferred stock		$ (2,475,000)	$ (5,189,000)							$ (2,475,000)	$ (5,189,000)
Distributions to noncontrolling interests	(2,639,000)													(2,639,000)
Redemption/conversion of operating partnership units (in shares)							339,000
Redemption/conversion of operating partnership units	3,454,000						$ 3,000	3,451,000							(3,454,000)
Net income (loss)	(84,513,000)								(79,538,000)					(4,975,000)	(10,036,000)
Redemption value adjustment	18,000								18,000						(18,000)
Ending balance (in shares) at Sep. 30, 2020						1,600,000	36,600,000
Ending balance at Sep. 30, 2020	282,582,000					$ 16,000	$ 365,000	533,641,000	(237,813,000)					(13,627,000)	29,713,000
Beginning balance, temporary equity at Dec. 31, 2019			$ 106,920,000
Increase (Decrease) in Temporary Equity [Roll Forward]
Issuance of preferred stock (in shares)			23,000
Issuance of preferred stock			$ 432,000
Units outstanding at end of year (in shares) at Sep. 30, 2020			5,031,000
Ending balance, temporary equity at Sep. 30, 2020			$ 107,352,000
Increase (Decrease) in Temporary Equity [Roll Forward]
Units outstanding at beginning of year			5,031,000
Beginning balance (in shares) at Jun. 30, 2020						1,600,000	33,528,000
Beginning balance at Jun. 30, 2020	297,995,000					$ 16,000	$ 335,000	525,846,000	(216,574,000)					(11,628,000)	31,589,000
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Purchase of common stock (in shares)							(1,000)
Purchase of common stock	(2,000)							(2,000)
Equity-based compensation	1,465,000							1,465,000							541,000
Issuance of common stock (in shares)							3,046,000
Issuance of common stock	6,410,000						$ 30,000	6,380,000
Issuance of restricted shares/units (in shares)							29,000
Issuance of restricted shares/units	(48,000)							(48,000)							(44,000)
Forfeiture of restricted common shares (in shares)							(2,000)
Forfeiture of restricted common shares	0
Dividends declared – preferred stock		(825,000)	$ (1,729,000)							(825,000)	(1,729,000)
Net income (loss)	(20,676,000)								(18,677,000)					(1,999,000)	(2,381,000)
Redemption value adjustment	(8,000)								(8,000)						8,000
Ending balance (in shares) at Sep. 30, 2020						1,600,000	36,600,000
Ending balance at Sep. 30, 2020	282,582,000					$ 16,000	$ 365,000	533,641,000	(237,813,000)					(13,627,000)	29,713,000
Beginning balance, temporary equity at Jun. 30, 2020			$ 107,352,000
Units outstanding at end of year (in shares) at Sep. 30, 2020			5,031,000
Ending balance, temporary equity at Sep. 30, 2020			$ 107,352,000
Increase (Decrease) in Temporary Equity [Roll Forward]
Units outstanding at beginning of year			5,031,000
Units outstanding at beginning of year			5,031,473	0	0
Beginning balance (in shares) at Dec. 31, 2020						1,600,000	38,275,000
Beginning balance at Dec. 31, 2020	261,170,000					$ 16,000	$ 382,000	541,870,000	(266,010,000)					(15,088,000)	27,655,000
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Purchase of common stock (in shares)							(50,000)
Purchase of common stock	(348,000)							(348,000)
Equity-based compensation	5,015,000							5,015,000							2,250,000
Issuance of common stock (in shares)							17,714,000
Issuance of common stock	99,809,000						$ 178,000	99,631,000
Issuance of common units for hotel acquisition	0														13,175,000
Issuance of restricted shares/units (in shares)							764,000
Issuance of restricted shares/units	0						$ 8,000	(8,000)							0
Forfeiture of restricted common shares (in shares)							(22,000)
Forfeiture of restricted common shares	0
Dividends declared – preferred stock		(2,475,000)	$ (3,689,000)	$ (90,000)	$ (4,000)					(2,475,000)	(3,689,000)	$ (90,000)	$ (4,000)
Contributions from noncontrolling interests	920,000													920,000
Redemption/conversion of operating partnership units (in shares)							2,000
Redemption/conversion of operating partnership units	17,000							17,000							(17,000)
Net income (loss)	(27,433,000)								(24,887,000)					(2,546,000)	(3,184,000)
Extinguishment of preferred stock (in shares)							7,291,000
Extinguishment of preferred stock	41,523,000						$ 71,000	46,047,000	(4,595,000)
Equity component of Convertible Senior Notes	6,257,000							6,257,000
Redemption value adjustment - preferred stock	(2,017,000)								(2,017,000)
Redemption value adjustment	(69,000)								(69,000)						69,000
Ending balance (in shares) at Sep. 30, 2021						1,600,000	63,974,000
Ending balance at Sep. 30, 2021	378,586,000					$ 16,000	$ 639,000	698,481,000	(303,836,000)					(16,714,000)	39,948,000
Beginning balance, temporary equity at Dec. 31, 2020			$ 106,949,000	$ 0	$ 0
Increase (Decrease) in Temporary Equity [Roll Forward]
Issuance of preferred stock (in shares)				266,000	15,000
Issuance of preferred stock				$ 4,204,000	$ 250,000
Extinguishment of preferred stock (in shares)			(1,953,000)
Extinguishment of preferred stock			$ (41,523,000)
Redemption value adjustment - preferred stock				$ 1,906,000	$ 111,000
Units outstanding at end of year (in shares) at Sep. 30, 2021			3,078,017	265,637	14,644
Ending balance, temporary equity at Sep. 30, 2021			$ 65,426,000	$ 6,110,000	$ 361,000
Increase (Decrease) in Temporary Equity [Roll Forward]
Units outstanding at beginning of year			3,108,000	0	0
Beginning balance (in shares) at Jun. 30, 2021						1,600,000	57,311,000
Beginning balance at Jun. 30, 2021	350,260,000					$ 16,000	$ 573,000	661,576,000	(295,641,000)					(16,264,000)	29,398,000
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Equity-based compensation	1,990,000							1,990,000							1,054,000
Issuance of common stock (in shares)							6,550,000
Issuance of common stock	34,232,000						$ 66,000	34,166,000
Issuance of common units for hotel acquisition	0														13,175,000
Dividends declared – preferred stock		$ (825,000)	$ (1,058,000)	$ (90,000)	$ (4,000)					$ (825,000)	$ (1,058,000)	$ (90,000)	$ (4,000)
Net income (loss)	(7,396,000)								(6,946,000)					(450,000)	(823,000)
Extinguishment of preferred stock (in shares)							120,000
Extinguishment of preferred stock	638,000							749,000	(111,000)
Redemption value adjustment - preferred stock	(2,017,000)								(2,017,000)
Redemption value adjustment	2,856,000								2,856,000						(2,856,000)
Ending balance (in shares) at Sep. 30, 2021						1,600,000	63,974,000
Ending balance at Sep. 30, 2021	$ 378,586,000					$ 16,000	$ 639,000	$ 698,481,000	$ (303,836,000)					$ (16,714,000)	$ 39,948,000
Beginning balance, temporary equity at Jun. 30, 2021			$ 66,064,000	$ 0	$ 0
Increase (Decrease) in Temporary Equity [Roll Forward]
Issuance of preferred stock (in shares)				266,000	15,000
Issuance of preferred stock				$ 4,204,000	$ 250,000
Extinguishment of preferred stock (in shares)			(30,000)
Extinguishment of preferred stock			$ (638,000)
Redemption value adjustment - preferred stock				$ 1,906,000
Units outstanding at end of year (in shares) at Sep. 30, 2021			3,078,017	265,637	14,644
Ending balance, temporary equity at Sep. 30, 2021			$ 65,426,000	$ 6,110,000	$ 361,000
Increase (Decrease) in Temporary Equity [Roll Forward]
Units outstanding at beginning of year			3,078,017	265,637	14,644

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CONDENSED CONSOLIDATED STATEMENTS OF EQUITY (Parenthetical) - $ / shares	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Series D Preferred Stock
Dividends declared per preferred share (in dollars per share)	$ 0.52	$ 0.52	$ 1.55	$ 1.55
Preferred stock dividend rate	8.25%	8.25%	8.25%	8.25%
Series B Preferred Stock
Dividends declared per preferred share (in dollars per share)	$ 0.34	$ 0.34	$ 1.03	$ 1.03
Preferred stock dividend rate	5.50%	5.50%	5.50%	5.50%
Series E Preferred Stock
Dividends declared per preferred share (in dollars per share)	$ 0.50		$ 0.50
Series M Preferred Stock
Dividends declared per preferred share (in dollars per share)	$ 0.51		$ 0.51
Preferred stock dividend rate			0.00082%

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss)	$ (30,617)	$ (94,549)
Adjustments to reconcile net income (loss) to net cash flows provided by (used in) operating activities:
Depreciation and amortization	54,881	55,398
Equity-based compensation	7,265	6,039
Bad debt expense	208	574
Amortization of loan costs, discounts and capitalized default interest	(550)	1,458
Write-off of loan costs and exit fees	1,960	3,572
Amortization of intangibles	394	621
Amortization of non-refundable membership initiation fees	(715)	(285)
Interest expense accretion on refundable membership club deposits	582	616
(Gain) loss on insurance settlement and disposition of assets	(696)	(10,149)
Realized and unrealized (gain) loss on derivatives	(64)	(133)
Net settlement of trading derivatives	0	30
Equity in (earnings) loss of unconsolidated entity	198	138
Deferred income tax expense (benefit)	(174)	(844)
Changes in operating assets and liabilities, exclusive of the effect of hotel acquisition:
Accounts receivable and inventories	(4,079)	7,271
Prepaid expenses and other assets	311	(67)
Accounts payable and accrued expenses	31,131	(7,912)
Operating lease right-of-use assets	416	387
Due to/from related parties, net	(919)	(442)
Due to/from third-party hotel managers	(7,365)	2,077
Operating lease liabilities	(184)	(162)
Other liabilities	2,755	1,535
Net cash provided by (used in) operating activities	55,147	(35,629)
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from property insurance	0	2,528
Net proceeds from disposition of assets	1,816	0
Acquisition of hotel property, net of cash and restricted cash acquired	(9,515)	0
Investment in unconsolidated entity	(117)	(26)
Improvements and additions to hotel properties	(15,849)	(21,451)
Net cash provided by (used in) investing activities	(23,665)	(18,949)
CASH FLOWS FROM FINANCING ACTIVITIES
Borrowings on indebtedness	83,231	109,317
Repayments of indebtedness	(83,770)	(46,033)
Payments of loan costs and exit fees	(1,895)	(6,478)
Payments for derivatives	(200)	(92)
Purchase of common stock	(376)	(260)
Payments for dividends and distributions	(6,882)	(13,599)
Proceeds from issuance of preferred stock	4,586	474
Proceeds from issuance of common stock	100,024	6,390
Contributions from noncontrolling interest in consolidated entities	920	0
Distributions to noncontrolling interest in consolidated entities	0	(2,639)
Net cash provided by (used in) financing activities	95,638	47,080
Net change in cash, cash equivalents and restricted cash	127,120	(7,498)
Cash, cash equivalents and restricted cash at beginning of period	113,150	130,383
Cash, cash equivalents and restricted cash at end of period	240,270	122,885
SUPPLEMENTAL CASH FLOW INFORMATION
Interest paid	22,268	20,969
Income taxes paid (refunded)	(20)	898
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES
Dividends and distributions declared but not paid	2,112	3,208
Common stock purchases accrued but not paid	0	2
Issuance of units for hotel acquisition	13,175	0
Issuance of warrants in hotel acquisition	1,528	0
Assumption of debt in hotel acquisition	49,815	0
Capital expenditures accrued but not paid	2,094	7,380
Accrued but unpaid financing costs	0	2,229
Non-cash loan principal associated with default interest and late charges	0	9,859
Accrued common stock offering expense	147	223
Unsettled common stock offering proceeds	0	243
Accrued preferred stock offering expenses	132	0
SUPPLEMENTAL DISCLOSURE OF CASH, CASH EQUIVALENTS AND RESTRICTED CASH
Cash and cash equivalents	195,517	88,227
Restricted cash	44,753	34,658
Cash, cash equivalents and restricted cash	240,270	122,885
Ashford Inc.
Changes in operating assets and liabilities, exclusive of the effect of hotel acquisition:
Due to affiliate	$ 409	$ (802)

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Organization and Description of Business

9 Months Ended

Sep. 30, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization and Description of Business

Organization and Description of Business

Braemar Hotels & Resorts Inc., together with its subsidiaries (“Braemar”), is a Maryland corporation that invests primarily in high revenue per available room (“RevPAR”) luxury hotels and resorts. High RevPAR, for purposes of our investment strategy, means RevPAR of at least twice the then-current U.S. national average RevPAR for all hotels as determined by Smith Travel Research. Braemar has elected to be taxed as a real estate investment trust (“REIT”) under the Internal Revenue Code of 1986, as amended (the “Code”). Braemar conducts its business and owns substantially all of its assets through its operating partnership, Braemar Hospitality Limited Partnership (“Braemar OP”). In this report, the terms “Company,” “we,” “us” or “our” refers to Braemar Hotels & Resorts Inc. and, as the context may require, all entities included in its condensed consolidated financial statements.

We are advised by Ashford Hospitality Advisors LLC (“Ashford LLC” or the “Advisor”) through an advisory agreement. Ashford LLC is a subsidiary of Ashford Inc. All of the hotel properties in our portfolio are currently asset-managed by Ashford LLC. We do not have any employees. All of the services that might be provided by employees are provided to us by Ashford LLC.

We do not operate any of our hotel properties directly; instead we employ hotel management companies to operate them for us under management contracts. Remington Hotels, a subsidiary of Ashford Inc., manages four of our 14 hotel properties. Third-party management companies manage the remaining hotel properties.

Ashford Inc. also provides other products and services to us or our hotel properties through certain entities in which Ashford Inc. has an ownership interest. These products and services include, but are not limited to design and construction services, debt placement and related services, broker-dealer and distribution services, audio visual services, real estate advisory services, insurance claims services, hypoallergenic premium rooms, watersport activities, travel/transportation services and mobile key technology.

The accompanying condensed consolidated financial statements include the accounts of wholly-owned and majority-owned subsidiaries of Braemar OP that as of September 30, 2021, own 14 hotel properties in six states, the District of Columbia and the U.S. Virgin Islands (“USVI”). The portfolio includes 12 wholly-owned hotel properties and two hotel properties that are owned through a partnership in which Braemar OP has a controlling interest. These hotel properties represent 3,865 total rooms, or 3,630 net rooms, excluding those attributable to our partner. As a REIT, Braemar is required to comply with limitations imposed by the Code related to operating hotels. As of September 30, 2021, 13 of our 14 hotel properties were leased by wholly-owned or majority-owned subsidiaries that are treated as taxable REIT subsidiaries (“TRS”) for federal income tax purposes (collectively the TRS entities are referred to as “Braemar TRS”). One hotel property, located in the USVI, is owned by our USVI TRS. Braemar TRS then engages third-party or affiliated hotel management companies to operate the hotel properties under management contracts. Hotel operating results related to the hotel properties are included in the condensed consolidated statements of operations.

As of September 30, 2021, 11 of the 14 hotel properties were leased by Braemar’s wholly-owned TRS, and the two hotel properties majority-owned through a consolidated partnership were leased to a TRS wholly-owned by such consolidated partnership. Each leased hotel is leased under a percentage lease that provides for each lessee to pay in each calendar month the base rent plus, in each calendar quarter, percentage rent, if any, based on hotel revenues. Lease revenue from Braemar TRS is eliminated in consolidation. The hotel properties are operated under management contracts with Marriott Hotel Services, Inc. (“Marriott”), Hilton Management LLC (“Hilton”), Accor Management US Inc. (“Accor”), Hyatt Corporation (“Hyatt”), Ritz-Carlton (Virgin Islands), Inc. and The Ritz-Carlton Hotel Company, L.L.C., each of which is an affiliate of Marriott (“Ritz-Carlton”) and Remington Hotels, which are eligible independent contractors under the Code.

Liquidity

In December 2019, COVID-19 was identified in Wuhan, China, subsequently spread to other regions of the world, and has resulted in significant travel restrictions and extended shutdown of numerous businesses throughout the United States. In March 2020, the World Health Organization declared COVID-19 to be a global pandemic. Beginning in late February 2020, we experienced a significant decline in occupancy and RevPAR associated with COVID-19 as we experienced significant reservation cancellations as well as a significant reduction in new reservations. The prolonged presence of the virus has resulted in health and other government authorities imposing widespread restrictions on travel and other businesses.

As of September 30, 2021, the Company maintained unrestricted cash of $195.5 million and restricted cash of $44.8 million. The vast majority of the restricted cash comprises lender and manager held reserves. As of September 30, 2021, there was also $20.4 million due to the Company from third-party hotel managers, which is primarily the Company’s cash held by one of its property managers which is also available to fund hotel operating costs. On December 10, 2020, the Company announced that it plans to continue its suspension of the common stock dividend into 2021 to protect liquidity and will evaluate future dividend declarations on a quarterly basis going forward.

We cannot predict when hotel operating levels will return to normalized levels after the effects of the pandemic fully subside, whether our hotels will be forced to shut down operations or whether one or more possible recurrences of COVID-19 case surges could result in further reductions in business and personal travel or potentially cause state and local governments to reinstate travel restrictions. Facts and circumstances could change in the future that are outside of management’s control, such as additional government mandates, health official orders, travel restrictions and extended business shutdowns due to COVID-19.

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Significant Accounting Policies

9 Months Ended

Sep. 30, 2021

Accounting Policies [Abstract]

Significant Accounting Policies

Significant Accounting Policies

Basis of Presentation and Principles of Consolidation—The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. These condensed consolidated financial statements include the accounts of Braemar Hotels & Resorts Inc., its majority-owned subsidiaries, and its majority-owned entities in which it has a controlling interest. All significant intercompany accounts and transactions between consolidated entities have been eliminated in these condensed consolidated financial statements. We have condensed or omitted certain information and footnote disclosures normally included in financial statements presented in accordance with GAAP in the accompanying unaudited condensed consolidated financial statements. We believe the disclosures made herein are adequate to prevent the information presented from being misleading. However, the financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our 2020 Annual Report on Form 10-K, as originally filed with the Securities and Exchange Commission (“SEC”) on March 5, 2021.

Braemar OP is considered to be a variable interest entity (“VIE”), as defined by authoritative accounting guidance. A VIE must be consolidated by a reporting entity if the reporting entity is the primary beneficiary because it has (i) the power to direct the VIE’s activities that most significantly impact the VIE’s economic performance and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE. All major decisions related to Braemar OP that most significantly impact its economic performance, including but not limited to operating procedures with respect to business affairs and any acquisitions, dispositions, financings, restructurings or other transactions with sellers, purchasers, lenders, brokers, agents and other applicable representatives, are subject to the approval of our wholly-owned subsidiary, Braemar OP General Partner LLC, its general partner. As such, we consolidate Braemar OP.

The following items affect reporting comparability of our historical condensed consolidated financial statements:

•historical seasonality patterns at some of our hotel properties cause fluctuations in our overall operating results. Consequently, operating results for the three and nine months ended September 30, 2021, are not necessarily indicative of the results that may be expected for the year ending December 31, 2021.

•on August 5, 2021, we acquired the Mr. C Beverly Hills Hotel and five adjacent luxury residences. The operating results of the hotel property have been included in the results of operations from its acquisition date.

Use of Estimates—The preparation of these condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Recently Adopted Accounting Standards—In January 2020, the Financial Accounting Standards Board’s (“FASB”) issued Accounting Standards Update (“ASU”) 2020-01, Investments – Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815) – Clarifying the Interactions between Topic 321, Topic 323, and Topic 815 (a consensus of the Emerging Issues Task Force) (“ASU 2020-01”), which clarifies the interaction between the accounting for equity securities, equity method investments, and certain derivative instruments. The ASU, among other

things, clarifies that a company should consider observable transactions that require a company to either apply or discontinue the equity method of accounting under Topic 323, Investments—Equity Method and Joint Ventures, for the purposes of applying the measurement alternative in accordance with Topic 321 immediately before applying or upon discontinuing the equity method. ASU 2020-01 is effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years and should be applied prospectively. Early adoption is permitted. We adopted the standard effective January 1, 2021 and the adoption of this standard did not have a material impact on our consolidated financial statements.

Recently Issued Accounting Standards—In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848) (“ASU 2020-04”). ASU 2020-04 contains practical expedients for reference rate reform related activities that impact debt, leases, derivatives and other contracts. The guidance in ASU 2020-04 is optional and may be elected over time as reference rate reform activities occur. In January 2021, the FASB issued ASU 2021-01, Reference Rate Reform (Topic 848): Scope (“ASU 2021-01”) to provide guidance and relief for transitioning to alternative reference rates. ASU 2021-01 is effective immediately for all entities. The Company continues to evaluate the impact of the guidance and may apply the elections as applicable as changes in the market occur.

In August 2020, the FASB issued ASU 2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (“ASU 2020-06”), which simplifies the accounting for certain financial instruments with characteristics of liabilities and equity. This ASU: (1) simplifies the accounting for convertible debt instruments and convertible preferred stock by removing the existing guidance in Accounting Standards Codification (“ASC”) 470-20, Debt: Debt with Conversion and Other Options, that requires entities to account for beneficial conversion features and cash conversion features in equity, separately from the host convertible debt or preferred stock; (2) revises the scope exception from derivative accounting in ASC 815-40 for freestanding financial instruments and embedded features that are both indexed to the issuer’s own stock and classified in stockholders’ equity, by removing certain criteria required for equity classification; and (3) revises the guidance in ASC 260, Earnings Per Share, to require entities to calculate diluted earnings per share (“EPS”) for convertible instruments by using the if-converted method. In addition, entities must presume share settlement for purposes of calculating diluted EPS when an instrument may be settled in cash or shares. For SEC filers, excluding smaller reporting companies, this ASU is effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020. Entities should adopt the guidance as of the beginning of the fiscal year of adoption and cannot adopt the guidance in an interim reporting period. We are currently evaluating the impact that ASU 2020-06 may have on our consolidated financial statements and related disclosures.

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Revenue

9 Months Ended

Sep. 30, 2021

Revenue from Contract with Customer [Abstract]

Revenue

RevenueThe following tables present our revenue disaggregated by geographical areas (dollars in thousands):

	Three Months Ended September 30, 2021
Primary Geographical Market	Number of Hotels	Rooms		Food and Beverage		Other Hotel		Total
California	6	$	28,838	$	8,024	$	3,626	$	40,488
Colorado	1	4,123		4,152		2,168		10,443
Florida	2	13,738		5,384		4,581		23,703
Illinois	1	5,233		1,196		389		6,818
Pennsylvania	1	3,911		580		243		4,734
Washington	1	6,906		792		550		8,248
Washington, D.C.	1	2,476		512		337		3,325
USVI	1	12,335		3,854		2,229		18,418
Total	14	$	77,560	$	24,494	$	14,123	$	116,177

	Three Months Ended September 30, 2020
Primary Geographical Market	Number of Hotels	Rooms		Food and Beverage		Other Hotel		Total
California	5	$	11,504	$	2,895	$	1,536	$	15,935
Colorado	1	1,688		692		1,659		4,039
Florida	2	7,103		3,175		3,262		13,540
Illinois	1	1,706		240		127		2,073
Pennsylvania	1	1,088		9		58		1,155
Washington	1	1,056		3		118		1,177
Washington, D.C.	1	331		4		292		627
USVI	1	3,642		1,519		1,047		6,208
Total	13	$	28,118	$	8,537	$	8,099	$	44,754

	Nine Months Ended September 30, 2021
Primary Geographical Market	Number of Hotels	Rooms		Food and Beverage		Other Hotel		Total
California	6	$	60,935	$	17,942	$	8,607	$	87,484
Colorado	1	12,058		8,344		6,058		26,460
Florida	2	47,964		18,732		15,311		82,007
Illinois	1	9,607		2,020		792		12,419
Pennsylvania	1	7,568		706		490		8,764
Washington	1	10,980		1,041		1,046		13,067
Washington, D.C.	1	5,711		767		832		7,310
USVI	1	40,897		11,424		7,303		59,624
Total	14	$	195,720	$	60,976	$	40,439	$	297,135

	Nine Months Ended September 30, 2020
Primary Geographical Market	Number of Hotels	Rooms		Food and Beverage		Other Hotel		Total
California	5	$	37,401	$	10,936	$	6,474	$	54,811
Colorado	1	9,955		4,974		4,898		19,827
Florida	2	24,401		12,535		10,292		47,228
Illinois	1	4,638		1,129		490		6,257
Pennsylvania	1	6,088		1,215		377		7,680
Washington	1	4,821		794		540		6,155
Washington, D.C.	1	6,857		3,482		1,174		11,513
USVI	1	10,958		4,352		6,388		21,698
Total	13	$	105,119	$	39,417	$	30,633	$	175,169

For the three and nine months ended September 30, 2020, the Company recorded revenue from business interruption losses associated with lost profits from Hurricane Irma of $0 and $4.0 million, respectively. This revenue is included in “other” hotel revenue in our condensed consolidated statement of operations. There was no such revenue recorded for the three and nine months ended September 30, 2021 as the insurance claim was fully settled in 2020.

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Investments in Hotel Properties, net

9 Months Ended

Sep. 30, 2021

Property, Plant and Equipment [Abstract]

Investments in Hotel Properties, net

Investments in Hotel Properties, net

Investments in hotel properties, net consisted of the following (in thousands):

	September 30, 2021		December 31, 2020
Land	$	480,530	$	455,298
Buildings and improvements	1,222,422		1,190,437
Furniture, fixtures and equipment	122,921		127,692
Construction in progress	9,136		11,422
Residences	12,746		—
Total cost	1,847,755		1,784,849
Accumulated depreciation	(395,753)		(360,259)
Investments in hotel properties, net	$	1,452,002	$	1,424,590

Impairment Charges and Insurance Recoveries

For the three and nine months ended September 30, 2021, we recognized a gain of $0 and $481,000, respectively. associated with proceeds received from an insurance claim.

For the three and nine months ended September 30, 2020, the Company received proceeds of $650,000 and $8.0 million, respectively, from our insurance carriers for property damage and business interruption from Hurricane Irma. There were no proceeds for the three and nine months ended September 30, 2021 as the claim was fully settled in September 2020.

During the three and nine months ended September 30, 2021 and 2020, no impairment charges were recorded.

In September 2020, the Company reached a final settlement with its insurance carriers related to Hurricane Irma. Upon settlement, the Company recorded a gain of $10.1 million as the proceeds received exceeded the carrying value of the hotel property at the time of the loss.

Mr. C Beverly Hills Hotel

On August 5, 2021, the Company acquired a 100% interest in the 138-room Mr. C Beverly Hills Hotel and five luxury residences adjacent to the hotel. The total consideration consisted of $10.0 million of cash, 2.5 million Braemar OP common units with a fair value of approximately $13.2 million and 500,000 warrants for the purchase of Braemar common stock with a $6.00 strike price and a fair value of approximately $1.5 million. Additionally the Company assumed a $50.0 million mortgage loan, with a fair value of approximately $49.8 million. Upon closing, the Company repaid $20.0 million of the assumed mortgage loan. See notes 6, 7 and 11 for further discussion regarding the mortgage loan, common units and warrants.

The acquisition of the Mr. C Beverly Hills Hotel included the hotel and the adjacent luxury residences (the “residences”). We have accounted for the transaction as a business combination under Accounting Standards Codification (“ASC”) 805- Business Combinations. We are in the process of evaluating the values assigned to investment in hotel property, property level working capital balances and the residences. This valuation is considered a Level 3 valuation technique. Thus, the balances reflected below are subject to change, and any such changes could result in adjustments to the allocation. Any change to the amounts recorded within the investments in hotel properties will also impact depreciation and amortization expense.

The following table summarizes the preliminary estimated fair value of the assets acquired and liabilities assumed in the acquisition (in thousands):

Land	$	25,232
Buildings and improvements	35,689
Furniture, fixtures and equipment	758
Residences	12,746
Investments in hotel properties	74,425
Inventories	94
Mortgage loan	(49,815)
	$	24,704
Net other assets (liabilities)	$	(486)

The results of operations of the hotel property have been included in our results of operations as of the acquisition date. The table below summarizes the total revenue and net income (loss) in our condensed consolidated statements of operations for the three and nine months ended September 30, 2021:

	Three Months Ended September 30, 2021		Nine Months Ended September 30, 2021
Total revenue	$	2,272	$	2,272
Net income (loss)	(1,203)		(1,203)

Pro Forma Financial Results

The following table reflects the unaudited pro forma results of operations as if the acquisitions had occurred and the applicable indebtedness was incurred on January 1, 2020, and the removal of $275,000 and $571,000 of non-recurring transaction costs directly attributable to the acquisition for the three and nine months ended September 30, 2021 (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Total revenue	$	117,808	$	46,409	$	303,406	$	181,121
Net income (loss)	$	(7,114)	$	(23,939)	$	(30,418)	$	(97,449)
Net income (loss) attributable to common stockholders	$	(7,898)	$	(20,675)	$	(34,082)	$	(84,203)
Pro Forma income per share;
Basic	$	(0.13)	$	(0.61)	$	(0.70)	$	(2.54)
Diluted	$	(0.13)	$	(0.61)	$	(0.70)	$	(2.54)
Weighted average common shares outstanding (in thousands):
Basic	59,207		33,923		48,954		33,103
Diluted	59,207		33,923		48,954		33,103

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Investment in Unconsolidated Entity

9 Months Ended

Sep. 30, 2021

Equity Method Investments and Joint Ventures [Abstract]

Investment in Unconsolidated Entity

Investment in Unconsolidated Entity

OpenKey is a hospitality-focused mobile key platform that provides a universal smart phone app and related hardware and software for keyless entry into hotel guest rooms. In 2018, the Company made an initial investment in OpenKey, which is controlled and consolidated by Ashford Inc., for an initial 8.2% ownership interest. On July 12, 2021, the Company made an additional investment in OpenKey of approximately $117,000. All investments were recommended by our Related Party Transactions Committee and unanimously approved by the independent members of our board of directors. As of September 30, 2021, the Company has made investments in OpenKey totaling $2.5 million.

Our investment is recorded as “investment in unconsolidated entity” in our condensed consolidated balance sheets and is accounted for under the equity method of accounting as we have significant influence over the entity under the applicable accounting guidance. We review our investment in OpenKey for impairment in each reporting period pursuant to the applicable authoritative accounting guidance. An investment is impaired when its estimated fair value is less than the carrying amount of

the investment. Any impairment is recorded in equity in earnings (loss) of unconsolidated entity. No such impairment was recorded for the three and nine months ended September 30, 2021 and 2020.

The following table summarizes our carrying value and ownership interest in OpenKey:

	September 30, 2021			December 31, 2020
Carrying value of the investment in OpenKey (in thousands)	$	1,627		$	1,708
Ownership interest in OpenKey	7.8		%	8.2		%

The following table summarizes our equity in earnings (loss) in OpenKey (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
Line Item	2021		2020		2021		2020
Equity in earnings (loss) of unconsolidated entity	$	(68)	$	(58)	$	(198)	$	(138)

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Indebtedness, net

9 Months Ended

Sep. 30, 2021

Debt Disclosure [Abstract]

Indebtedness, net

Indebtedness, net

Indebtedness, net consisted of the following (dollars in thousands):

Indebtedness	Collateral	Current Maturity	Final Maturity (12)	Interest Rate	September 30, 2021		December 31, 2020
Mortgage loan (3)	Park Hyatt Beaver Creek Resort & Spa	April 2022	April 2022	LIBOR (1) +3.00%	$	67,500	$	67,500
Mortgage loan (4)	The Notary Hotel	June 2022	June 2025	LIBOR (1) + 2.16%	435,000		435,000
	The Clancy
	Sofitel Chicago Magnificent Mile
	Marriott Seattle Waterfront
Mortgage loan (5)	The Ritz-Carlton St. Thomas	August 2022	August 2024	LIBOR (1) + 3.95%	42,500		42,500
Term loan (6)	Equity	October 2022	October 2022	Base Rate (2) + 1.25% to 2.65% or LIBOR (1) + 2.25% to 3.65%	—		61,495
Mortgage loan (7)	The Ritz-Carlton Sarasota	April 2023	April 2023	LIBOR (1) + 2.65%	99,750		100,000
Mortgage loan (7) (8)	Hotel Yountville	May 2023	May 2023	LIBOR (1) + 2.55%	51,000		51,000
Mortgage loan (7) (8)	Bardessono Hotel and Spa	August 2023	August 2023	LIBOR (1) + 2.55%	40,000		40,000
Mortgage loan (7)	The Ritz-Carlton Lake Tahoe	January 2024	January 2024	LIBOR (1) + 2.10%	54,000		54,000
Mortgage loan (9)	Capital Hilton	February 2024	February 2024	LIBOR (1) + 1.70%	195,203		197,229
	Hilton La Jolla Torrey Pines
Mortgage loan (10)	Mr. C Beverly Hills Hotel	August 2024	August 2024	LIBOR (1) + 3.60%	30,000		—
Mortgage loan (7)	Pier House Resort & Spa	September 2024	September 2024	LIBOR (1) + 1.85%	80,000		80,000
Convertible Senior Notes (11)	Equity	June 2026	June 2026	4.50%	86,250		—
					1,181,203		1,128,724
Capitalized default interest and late charges					4,425		7,304
Deferred loan costs, net					(3,997)		(5,434)
Discounts, net					(8,844)		—
Indebtedness, net					$	1,172,787	$	1,130,594

__________________

(1)LIBOR rates were 0.080% and 0.144% at September 30, 2021 and December 31, 2020, respectively.

(2)Base Rate, as defined in the secured term loan agreement, is the greater of (i) the prime rate set by Bank of America, or (ii) federal funds rate + 0.5%, or (iii) LIBOR + 1.0%.

(3)Effective January 9, 2021, we amended this mortgage loan. Terms of the agreement included monthly FF&E escrow deposits being waived from January 2021 through June 2021. This mortgage loan has three one-year extension options, subject to satisfaction of certain conditions, of which the third was exercised in April 2021.

(4)This mortgage loan has five one-year extension options, subject to satisfaction of certain conditions, of which the second was exercised in June 2021.

(5)This mortgage loan has three one-year extension options, subject to satisfaction of certain conditions, of which the first was exercised in August 2021. This mortgage loan has a LIBOR floor of 1.00%.

(6)Effective February 22, 2021, we amended this term loan. In conjunction with the amendment, the interest rate spread increased from a rate of Base Rate + 1.25% - 2.50% or LIBOR + 2.25% - 3.50% to a Base Rate + 1.25% - 2.65% or LIBOR + 2.25% - 3.65%, with a LIBOR floor of 0.50%. On May 18, 2021, we repaid this term loan in full.

(7)Effective December 31, 2020, we amended this mortgage loan. Terms of the agreement included monthly FF&E escrow deposits being waived from January 2021 through December 2021. This mortgage loan has a LIBOR floor of 0.25%.

(8)On September 23, 2021, we amended this mortgage loan. Terms of the agreement included extending the current and final maturity dates by one year.

(9)Effective March 5, 2021, we amended this mortgage loan. Terms of the agreement included monthly FF&E escrow deposits waived through July 1, 2021.

(10)This mortgage loan has a LIBOR floor of 1.50%.

(11)On May 18, 2021, we executed a purchase agreement to sell convertible senior notes in a private offering. In conjunction with the private offering, we sold convertible senior notes with an aggregate principal amount of $86.25 million.

(12)The final maturity date assumes all available extensions options will be exercised.

During the second and third quarters of 2020, we reached forbearance and other agreements with our lenders relating to loans secured by the Pier House Resort & Spa, The Ritz-Carlton Sarasota, The Ritz-Carlton Lake Tahoe, Hotel Yountville, Bardessono Hotel and Spa, Sofitel Chicago Magnificent Mile, The Notary Hotel, The Clancy, Marriott Seattle Waterfront, Capital Hilton and Hilton La Jolla Torrey Pines. As of September 30, 2021, no loans are in default. See note 14 for discussion of the loan modification agreement with Lismore Capital LLC (“Lismore”). The Company determined that all of the forbearance and other agreements evaluated were considered troubled debt restructurings due to terms that allowed for deferred interest and the forgiveness of default interest and late charges. No gain or loss was recognized during 2020, as the carrying amount of the original loans was not greater than the undiscounted cash flows of the modified loans. Additionally, as a result of the troubled debt restructurings all accrued default interest and late charges were capitalized into the applicable loan balances and are being amortized over the remaining term of the loans using the effective interest method. The amount of non-cash principal amortization associated with the default interest and late charges during the three and nine months ended September 30, 2021 was approximately $519,000 and $2.9 million, respectively. The amount of principal amortization during the three and nine months ended September 30, 2020 was $937,000 and $1.2 million, respectively.

On August 5, 2021, in connection with the acquisition of the Mr. C Beverly Hills Hotel and the adjacent residences in Los Angeles, California, the Company assumed a $50 million mortgage loan and repaid $20 million upon closing. This mortgage loan provides for an interest rate of LIBOR + 3.60%. The mortgage loan is interest only with the stated maturity in August 2024.

Convertible Senior Notes

In May 2021, the Company issued $86.25 million aggregate principal amount of 4.50% Convertible Senior Notes due June 2026 (the “Convertible Senior Notes”). The net proceeds from this offering of the Convertible Senior Notes were approximately $82.8 million after deducting the underwriting fees and other expenses paid by the Company. A portion of the proceeds were used to fully repay the secured term loan.

The Convertible Senior Notes are governed by an indenture (the “Base Indenture”) between the Company and U.S. Bank National Association, as trustee. The Convertible Senior Notes bear interest at a rate of 4.50% per annum, payable semi-annually in arrears on June 1 and December 1 of each year, beginning on December 1, 2021. The Convertible Senior Notes will mature on June 1, 2026. The Company recorded coupon interest expense of $970,000 and $1.4 million, respectively, for the three and nine months ended September 30, 2021.

The Company separated the Convertible Senior Notes into liability and equity components. The initial carrying amount of the liability component was calculated using a discount rate of 7.1%. The discount rate was based on the terms of debt instruments that were similar to the Convertible Senior Notes. The $6.3 million carrying amount of the equity component representing the conversion option was determined by deducting the fair value of the liability component from the net proceeds of the Convertible Senior Notes. The amount recorded in equity is not subject to remeasurement or amortization. The initial discount of $9.3 million is accreted to interest expense using the effective interest rate method over the contractual term of the Convertible Senior Notes. The Company recorded discount amortization of $391,000 and $576,000, respectively, for the three and nine months ended September 30, 2021.

The Convertible Senior Notes are convertible at any time prior to the close of business on the business day immediately preceding the maturity date for cash, shares of the Company’s common stock or a combination of cash and shares of the Company’s common stock, at the election of the Company, based on an initial conversion rate of 157.7909 shares of the Company’s common stock per $1,000 principal amount of notes (equivalent to a conversion price of approximately $6.34 per share of common stock), subject to adjustment of the conversion rate under certain circumstances. In addition, following the occurrence of certain corporate events, if the Company provides notice of redemption or if it exercises its option to convert the Convertible Senior Notes, the Company will, in certain circumstances, increase the conversion rate for a holder that converts its

Convertible Senior Notes in connection with such corporate event, such notice of redemption, or such issuer conversion option, as the case may be.

The Company may redeem the Convertible Senior Notes at the Company’s option, in whole or in part, on any business day on or after the date of issuance if the last reported sale price per share of the Company’s common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which the Company provides a notice of redemption at a redemption price equal to 100% of the principal amount of the Convertible Senior Notes to be redeemed subject to certain adjustments, plus accrued and unpaid interest to, but excluding, the redemption date.

If we violate covenants in any debt agreement, we could be required to repay all or a portion of our indebtedness before maturity at a time when we might be unable to arrange financing for such repayment on attractive terms, if at all. The assets of certain of our subsidiaries are pledged under non-recourse indebtedness and are not available to satisfy the debts and other obligations of the consolidated group. As of September 30, 2021, we were in compliance with all covenants.

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Derivative Instruments

9 Months Ended

Sep. 30, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments

Derivative Instruments

Interest Rate Derivatives—We are exposed to risks arising from our business operations, economic conditions and financial markets. To manage these risks, we primarily use interest rate derivatives to hedge our debt and our cash flows. The interest rate derivatives include interest rate caps and interest rate floors, which are subject to master netting settlement arrangements. All derivatives are recorded at fair value.

The following table summarizes the interest rate derivatives we entered into over the applicable periods:

	Nine Months Ended September 30,
Interest rate caps:(1)	2021			2020
Notional amount (in thousands)	$	882,500		$	602,500
Strike rate low end of range	0.75		%	3.00		%
Strike rate high end of range	4.00		%	4.00		%
Effective date range	January 2021- September 2021			March 2020 - June 2020
Termination date range	February 2022- August 2024			April 2021 - June 2021
Total cost of interest rate caps (in thousands)	$	200		$	92

_______________

(1)    No instruments were designated as cash flow hedges.

Interest rate derivatives consisted of the following:

Interest rate caps: (1)	September 30, 2021			December 31, 2020
Notional amount (in thousands)	$	962,500		$	779,000
Strike rate low end of range	0.75		%	3.00		%
Strike rate high end of range	4.00		%	4.00		%
Termination date range	October 2021 - August 2024			February 2021 - October 2021
Aggregate principal balance on corresponding mortgage loans (in thousands)	$	857,250		$	779,000

_______________

(1)No instruments were designated as cash flow hedges.

Warrants—On August 5, 2021, as part of the consideration paid to acquire the Mr. C Beverly Hills Hotel and five adjacent luxury residences, the Company issued 500,000 warrants for the purchase of Braemar common stock with a $6.00 strike price on or after the August 5, 2021 until August 5, 2024. The holder can choose to exercise the warrant by cash or by net issue exercise, in which event the Company shall issue to the holder a number of warrant shares which reflects the fair market value of the Company’s common stock. As of September 30, 2021, no warrants have been exercised.

The initial fair value of the warrant was calculated using a Black-Scholes option pricing model with the following assumptions: three-year contractual term; 97.93% volatility; 0% dividend rate; and a risk-free interest rate of 0.38%. The estimated fair value of the warrants was approximately $1.5 million on the date of issuance. The warrants are re-valued at each reporting period with the change in fair value recorded through earnings.

In applying the guidance in ASC 815, it was determined that the warrants should be classified as a liability as a result of certain settlement provisions. The warrants are included in derivative liabilities on the condensed consolidated balance sheet and changes in value are reported as a component of unrealized gain (loss) on derivatives on the condensed consolidated statements of operations. This is a Level 2 valuation technique.

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Fair Value Measurements

9 Months Ended

Sep. 30, 2021

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair Value Measurements

Fair Value Hierarchy—Our financial instruments measured at fair value either on a recurring or a non-recurring basis are classified in a hierarchy for disclosure purposes consisting of three levels based on the observability of inputs in the market place as discussed below:

•Level 1: Fair value measurements that are quoted prices (unadjusted) in active markets that we have the ability to access for identical assets or liabilities. Market price data generally is obtained from exchange or dealer markets.

•Level 2: Fair value measurements based on inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices for similar assets and liabilities in active markets, and inputs other than quoted prices that are observable for the asset or liability, such as interest rates and yield curves that are observable at commonly quoted intervals.

•Level 3: Fair value measurements based on valuation techniques that use significant inputs that are unobservable. The circumstances for using these measurements include those in which there is little, if any, market activity for the asset or liability.

Fair value of interest rate caps is determined using the net present value of expected cash flows of each derivative based on the market-based interest rate curve and adjusted for credit spreads of us and our counterparties. Fair value of credit default swaps is obtained from a third-party who publishes various information including the index composition and price data (Level 2 inputs). The fair value of credit default swaps does not contain credit-risk-related adjustments as the change in fair value is settled net through posting cash collateral or reclaiming cash collateral between us and our counterparty. Fair value of interest rate floors is calculated using a third-party discounted cash flow model based on future cash flows that are expected to be received over the remaining life of the floor. The fair value of warrants is determined by using the Black-Scholes option pricing model.

When a majority of the inputs used to value our derivatives fall within Level 2 of the fair value hierarchy, the derivative valuations in their entirety are classified in Level 2 of the fair value hierarchy. However, when the valuation adjustments associated with our derivatives utilize Level 3 inputs, such as estimates of current credit spreads, to evaluate the likelihood of default by us and our counterparties, which we consider significant (10% or more) to the overall valuation of our derivatives, the derivative valuations in their entirety are classified in Level 3 of the fair value hierarchy. Transfers of inputs between levels are determined at the end of each reporting period. In determining the fair values of our derivatives at September 30, 2021, the LIBOR interest rate forward curve (Level 2 inputs) assumed an uptrend from 0.080% to 1.188% for the remaining term of our derivatives. Credit spreads (Level 3 inputs) used in determining the fair values derivatives assumed an uptrend in nonperformance risk for us and all of our counterparties through the maturity dates.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following table presents our assets and liabilities measured at fair value on a recurring basis aggregated by the level within which measurements fall in the fair value hierarchy (in thousands):

	Quoted Market Prices (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
September 30, 2021
Assets
Derivative assets:
Interest rate derivatives - caps	$	—	$	74	$	—	$	74
Total	$	—	$	74	$	—	$	74	(1)
Liabilities
Derivative liabilities:
Warrants	—		(1,338)		$	—	(1,338)		(2)
Net	$	—	$	(1,264)	$	—	$	(1,264)

__________________

(1)Reported as “derivative assets” in our condensed consolidated balance sheet.

(2)Reported as “derivative liabilities” in our condensed consolidated balance sheet.

Effect of Fair Value Measured Assets and Liabilities on Condensed Consolidated Statements of Operations

The following table summarizes the effect of fair value measured assets and liabilities on our condensed consolidated statements of operations (in thousands):

	Gain (Loss) Recognized in Income
	Three Months Ended September 30,					Nine Months Ended September 30,
	2021		2020			2021		2020
Assets
Derivative assets:
Interest rate derivatives - caps	$	(48)	$	(30)		$	(126)	$	(93)
Credit default swaps	—		51		(1)	—		226		(1)
Total derivative assets	$	(48)	$	21		$	(126)	$	133
Total	$	(48)	$	21		$	(126)	$	133
Liabilities
Derivative liabilities:
Warrants	190		—			190		—
Net	$	142	$	21		$	64	$	133
Total combined
Interest rate derivatives - floors	$	—	$	3,540		$	—	$	3,615
Interest rate derivatives - caps	(48)		(30)			(126)		(93)
Credit default swaps	—		51			—		226
Warrants	190		—			190		—
Unrealized gain (loss) on derivatives	142		3,561			64		3,748
Realized gain (loss) on interest rate floors	—		(3,540)		(2)	—		(3,615)		(2)
Net	$	142	$	21		$	64	$	133

_______________

(1)Excludes costs associated with credit default swaps of $0 and $64 for the three months ended September 30, 2021 and 2020, respectively, as well as $0 and $191 for the nine months ended September 30, 2021 and 2020, respectively, which is included in “other income (expense)” in our condensed consolidated statements of operations.

(2)Included in “other income (expense)” in our condensed consolidated statements of operations.

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Summary of Fair Value of Financial Instruments

9 Months Ended

Sep. 30, 2021

Investments, All Other Investments [Abstract]

Summary of Fair Value of Financial Instruments

Summary of Fair Value of Financial Instruments

Determining the estimated fair values of certain financial instruments such as indebtedness requires considerable judgment to interpret market data. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts. Accordingly, the estimates presented are not necessarily indicative of the amounts at which these instruments could be purchased, sold or settled.

The carrying amounts and estimated fair values of financial instruments were as follows (in thousands):

	September 30, 2021				December 31, 2020
	Carrying Value		Estimated Fair Value		Carrying Value		Estimated Fair Value
Financial assets and liabilities measured at fair value:
Derivative assets	$	74	$	74	$	—	$	—
Derivative liabilities	1,338		1,338		—		—
Financial assets not measured at fair value:
Cash and cash equivalents	$	195,517	$	195,517	$	78,606	$	78,606
Restricted cash	44,753		44,753		34,544		34,544
Accounts receivable, net	17,317		17,317		13,557		13,557
Due from related parties, net	1,910		1,910		991		991
Due from third-party hotel managers	20,390		20,390		12,271		12,271
Financial liabilities not measured at fair value:
Indebtedness	$	1,172,359	$968,075 to $1,069,978		$	1,128,724	$884,325 to $977,411
Accounts payable and accrued expenses	89,265		89,265		61,758		61,758
Dividends and distributions payable	2,112		2,112		2,736		2,736
Due to Ashford Inc.	820		820		2,772		2,772
Due to third-party hotel managers	1,665		1,665		1,393		1,393

Cash, cash equivalents and restricted cash. These financial assets have maturities of less than 90 days and most bear interest at market rates. The carrying value approximates fair value due to their short-term nature. This is considered a Level 1 valuation technique.

Accounts receivable, net, due from related parties, net, accounts payable and accrued expenses, dividends and distributions payable, due to Ashford Inc. and due to/from third-party hotel managers. The carrying values of these financial instruments approximate their fair values due to the short-term nature of these financial instruments. This is considered a Level 1 valuation technique.

Derivative assets and derivative liabilities. See notes 7 and 8 for a complete description of the methodology and assumptions utilized in determining fair values.

Indebtedness, net. Fair value of indebtedness is determined using future cash flows discounted at current replacement rates for these instruments. Cash flows are determined using a forward interest rate yield curve. The current replacement rates are determined by using the U.S. Treasury yield curve or the index to which these financial instruments are tied, and adjusted for the credit spreads. Credit spreads take into consideration general market conditions, maturity and collateral. We estimated the fair value of the total indebtedness to be approximately 82.6% to 91.3% of the carrying value of $1.2 billion at September 30, 2021, and approximately 78.3% to 86.6% of the carrying value of $1.1 billion at December 31, 2020. These fair value estimates are considered a Level 2 valuation technique.

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Income (Loss) Per Share

9 Months Ended

Sep. 30, 2021

Earnings Per Share [Abstract]

Income (Loss) Per Share

Income (Loss) Per Share

The following table reconciles the amounts used in calculating basic and diluted income (loss) per share (in thousands, except per share amounts):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Net income (loss) attributable to common stockholders - basic and diluted:
Net income (loss) attributable to the Company	$	(6,946)	$	(18,677)	$	(24,887)	$	(79,538)
Less: Dividends on preferred stock	(1,977)		(2,554)		(6,258)		(7,664)
Less: Loss on extinguishment of preferred stock - Series B	(111)		—		(4,595)		—
Undistributed net income (loss) allocated to common stockholders	(9,034)		(21,231)		(35,740)		(87,202)
Distributed and undistributed net income (loss) - basic and diluted	$	(9,034)	$	(21,231)	$	(35,740)	$	(87,202)
Weighted average common shares outstanding:
Weighted average common shares outstanding – basic and diluted	59,207		33,923		48,954		33,103
Income (loss) per share - basic:
Net income (loss) allocated to common stockholders per share	$	(0.15)	$	(0.63)	$	(0.73)	$	(2.63)
Income (loss) per share - diluted:
Net income (loss) allocated to common stockholders per share	$	(0.15)	$	(0.63)	$	(0.73)	$	(2.63)

Due to their anti-dilutive effect, the computation of diluted income (loss) per share does not reflect the adjustments for the following items (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Net income (loss) allocated to common stockholders is not adjusted for:
Income (loss) attributable to redeemable noncontrolling interests in operating partnership	$	(823)	$	(2,381)	$	(3,184)	$	(10,036)
Dividends on preferred stock - Series B	1,058		1,729		3,689		5,189
Loss on extinguishment of preferred stock - Series B	111		—		4,595		—
Interest expense on Convertible Senior Notes	1,361		—		2,010		—
Dividends on preferred stock - Series E	90		—		90		—
Dividends on preferred stock - Series M	4		—		4		—
Total	$	1,801	$	(652)	$	7,204	$	(4,847)
Weighted average diluted shares are not adjusted for:
Effect of unvested restricted shares	89		—		100		25
Effect of assumed conversion of operating partnership units	5,564		3,863		4,543		3,940
Effect of assumed conversion of preferred stock - Series B	4,115		6,728		4,781		6,728
Effect of assumed conversion of exchanged preferred stock - Series B	—		269		485		288
Effect of contingently issuable shares	—		10		—		3
Effect of assumed conversion of Convertible Senior Notes	13,609		—		6,730		—
Effect of assumed conversion of preferred stock - Series E	700		—		233		—
Effect of assumed conversion of preferred stock - Series M	32		—		11		—
Total	24,109		10,870		16,883		10,984

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Redeemable Noncontrolling Interests in Operating Partnership

9 Months Ended

Sep. 30, 2021

Noncontrolling Interest [Abstract]

Redeemable Noncontrolling Interests in Operating Partnership

Redeemable Noncontrolling Interests in Operating PartnershipRedeemable noncontrolling interests in the operating partnership represents the limited partners’ proportionate share of equity and their allocable share of equity in earnings/losses of Braemar OP, which is an allocation of net income/loss attributable to the common unitholders based on the weighted average ownership percentage of these limited partners’ common units of limited partnership interest in the operating partnership (the “common units”) and units issued under our Long-Term Incentive Plan (the “LTIP” units) that are vested. Each common unit may be redeemed, by the holder, for either cash or, at our sole discretion, up to one share of our REIT common stock, which is either: (i) issued pursuant to an effective registration

statement; (ii) included in an effective registration statement providing for the resale of such common stock; or (iii) issued subject to a registration rights agreement.

LTIP units, which are issued to certain executives and employees of Ashford LLC as compensation, generally have vesting periods of three years. Additionally, certain independent members of the board of directors have elected to receive LTIP units as part of their compensation, which are fully vested upon grant. Upon reaching economic parity with common units, each vested LTIP unit can be converted by the holder into one common unit which can then be redeemed for cash or, at our election, settled in our common stock. An LTIP unit will achieve parity with the common units upon the sale or deemed sale of all or substantially all of the assets of our operating partnership at a time when our stock is trading at a level in excess of the price it was trading on the date of the LTIP issuance. More specifically, LTIP units will achieve full economic parity with common units in connection with (i) the actual sale of all or substantially all of the assets of our operating partnership or (ii) the hypothetical sale of such assets, which results from a capital account revaluation, as defined in the partnership agreement, for our operating partnership.

The Company issued equity awards in the first quarter of 2021, a substantial majority of which were issued subject to stockholder approval of an increase in the number of shares available for issuance under the Company’s 2013 Equity Incentive Plan. Under the applicable accounting literature, these awards are not accounted for until stockholder approval is obtained. In March 2021, approximately 244,000 LTIP units with a fair value of approximately $1.7 million and a vesting period of three years were granted. Stockholder approval was obtained on May 11, 2021.

On May 11, 2021, approximately 202,000 LTIP units with a fair value of $1.4 million and a vesting period of three years were issued. Additionally, approximately 23,000 LTIP units were issued to independent directors, with a fair value of approximately $164,000, which vested immediately upon grant.

The compensation committee of the board of directors of the Company may authorize the issuance of Performance LTIP units to certain executive officers and directors from time to time. The award agreements provide for the grant of a target number of Performance LTIP units that will be settled in common units of Braemar OP, if, when and to the extent the applicable vesting criteria have been achieved following the end of the performance and service period, which is generally three years from the grant date.

With respect to the 2019 and 2020 award agreements, the number of Performance LTIP units actually earned may range from 0% to 200% of target based on achievement of a specified relative total stockholder return based on the formula determined by the Company’s compensation committee on the grant date. The performance criteria for the Performance LTIP units are based on market conditions under the relevant literature. The corresponding compensation cost is recognized ratably over the service period for the award as the service is rendered, based on the grant date fair value of the award, regardless of the actual outcome of the market condition.

With respect to the 2021 award agreements, the compensation committee shifted to a new performance metric, pursuant to which, the performance awards will be eligible to vest, from 0% to 200% of target, based on achievement of certain performance targets over the three-year performance period commencing on January 1, 2021 and ending on December 31, 2023. The performance criteria for the 2021 performance grants are based on performance conditions under the relevant literature. The corresponding compensation cost is recognized ratably over the service period for the award as the service is rendered, based on the grant date fair value of the award. The grant date fair value of the award may vary from period to period, as the number of performance grants earned may vary since the estimated probable achievement of certain performance targets may vary from period to period. On May 11, 2021, approximately 840,000 Performance LTIP units with a fair value of approximately $5.7 million and a vesting period of three years were granted.

As of September 30, 2021, we have issued a total of approximately 2.4 million LTIP units (including Performance LTIP units), net of cancellations, all of which, other than approximately 572,000 LTIP units and 900,000 Performance LTIP units issued from March 2015 to May 2021, had reached full economic parity with, and are convertible into, common units.

On August 5, 2021, we issued 2.5 million common units in our operating partnership in conjunction with the acquisition of the Mr. C Beverly Hills Hotel. See note 4.

The following table presents the redeemable noncontrolling interests in Braemar OP (in thousands) and the corresponding approximate ownership percentage of our operating partnership:

	September 30, 2021			December 31, 2020
Redeemable noncontrolling interests in Braemar OP	$	39,948		$	27,655
Adjustments to redeemable noncontrolling interests (1)	$	236		$	167
Ownership percentage of operating partnership	8.35		%	9.43		%

____________________________________

(1)    Reflects the excess of the redemption value over the accumulated historical cost.

We allocated net income (loss) to the redeemable noncontrolling interests as illustrated in the table below (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Net (income) loss attributable to redeemable noncontrolling interests in operating partnership	$	823	$	2,381	$	3,184	$	10,036

The following table presents the common units redeemed and the fair value at redemption (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Common units converted to common stock	—		—		2		339
Fair value of common units converted	$	—	$	—	$	15	$	390	(1)

____________________________________

(1)    The redemption value is the greater of historical cost or fair value. The historical cost of the converted units was $3.5 million.

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Equity and Stock-Based Compensation

9 Months Ended

Sep. 30, 2021

Equity [Abstract]

Equity and Stock-Based Compensation

Equity and Stock-Based CompensationCommon Stock Dividends—The board of directors did not declare a quarterly common stock dividend for the three and nine months ended September 30, 2021 and 2020

Restricted Stock Units—We incur stock-based compensation expense in connection with restricted stock units awarded to certain employees of Ashford LLC and its affiliates. We also issue common stock to certain of our independent directors, which vests immediately upon issuance.

The Company issued equity awards in the first quarter of 2021, a substantial majority of which were issued subject to stockholder approval of an increase in the number of shares available for issuance under the Company’s 2013 Equity Incentive Plan. Under the applicable accounting literature, these awards are not accounted for until stockholder approval is obtained. In March 2021, approximately 504,000 restricted stock units with a fair value of approximately $3.5 million and a vesting period of three years were granted. Stockholder approval was obtained on May 11, 2021.

On May 11, 2021, approximately 215,000 restricted stock units with a fair value of approximately $1.5 million and a vesting period of three years were granted. Additionally, approximately 46,000 shares of common stock were issued to independent directors, with a fair value of approximately $322,000, which vested immediately upon grant.

Performance Stock Units—The compensation committee of the board of directors of the Company may authorize the issuance of grants of performance stock units (“PSUs”) to certain executive officers and directors from time to time. The award agreements provide for the grant of a target number of PSUs that will be settled in shares of common stock of the Company, if, when and to the extent the applicable vesting criteria have been achieved following the end of the performance and service period, which is generally three years from the grant date.

With respect to the 2019 and 2020 award agreements, the number of PSUs actually earned may range from 0% to 200% of target based on achievement of a specified relative total stockholder return based on the formula determined by the Company’s compensation committee on the grant date. The performance criteria for the PSUs are based on market conditions under the relevant literature. The corresponding compensation cost is recognized ratably over the service period for the award as the service is rendered, based on the grant date fair value of the award, regardless of the actual outcome of the market condition.

The Company issued equity awards in the first quarter of 2021, a substantial majority of which were issued subject to stockholder approval of an increase in the number of shares available for issuance under the Company’s Amended and Restated 2011 Stock Incentive Plan. Under the applicable accounting literature, these awards are not accounted for until shareholder approval is obtained. Stockholder approval was obtained on May 11, 2021.

With respect to the 2021 award agreements, the compensation committee shifted to a new performance metric, pursuant to which, the performance awards will be eligible to vest, from 0% to 200% of target, based on achievement of certain performance targets over the three-year performance period commencing on January 1, 2021 and ending on December 31, 2023. The performance criteria for the 2021 performance grants are based on performance conditions under the relevant literature, and the 2021 performance grants were issued to non-employees. The corresponding compensation cost is recognized ratably over the service period for the award as the service is rendered, based on the grant date fair value of the award, which may vary from period to period, as the number of performance grants earned may vary since the estimated probable achievement of certain performance targets may vary from period to period.

On May 11, 2021, approximately 446,000 PSUs with a fair value of approximately $6.0 million and vesting period of three years were issued.

8.25% Series D Cumulative Preferred Stock—The dividend for all issued and outstanding shares of the Company’s Series D Cumulative Preferred Stock (the “Series D Preferred Stock”) is set at $2.0625 per annum per share.

The following table summarizes dividends declared (in thousands):

	Three Months Ended September 30,			Nine Months Ended September 30,
	2021		2020	2021		2020
Series D Cumulative Preferred Stock	$	825	825	$	2,475	$	2,475

At-the-Market Common Stock Equity Distribution Program—On December 11, 2017, the Company established an “at-the-market” equity distribution program pursuant to which it may, from time to time, sell shares of its common stock having an aggregate offering price of up to $50 million.

As of September 30, 2021, the Company has sold approximately 7.4 million shares of common stock and received net proceeds of approximately $30.5 million under this program.

The issuance activity is summarized below (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Common shares issued	—		3,046		2,711		3,046
Gross proceeds received	$	—	$	7,715	$	16,119	$	7,715
Commissions and other expenses	—		97		202		97
Net proceeds	$	—	$	7,618	$	15,917	$	7,618

Standby Equity Distribution Agreement—On February 4, 2021, the Company entered into a Standby Equity Distribution Agreement (the “SEDA”) with YA II PN, Ltd. (“YA”), pursuant to which the Company will be able to sell up to 7,780,786 shares of its common stock (the “Commitment Amount”) at the Company’s request any time during the commitment period commencing on February 4, 2021, and terminating on the earliest of (i) the first day of the month next following the 36-month anniversary of the SEDA or (ii) the date on which YA shall have made payment of Advances (as defined in the SEDA) pursuant to the SEDA for shares of the Company’s common stock equal to the Commitment Amount (the “Commitment Period”). Other than with respect to the Initial Advance (as defined below) the shares sold to YA pursuant to the SEDA would be purchased at 95% of the Market Price (as defined below) and would be subject to certain limitations, including that YA could not purchase any shares that would result in it owning more than 4.99% of the Company’s common stock. “Market Price” shall mean the lowest daily VWAP (as defined below) of the Company’s common stock during the five consecutive trading days commencing on the trading day following the date the Company submits an advance notice to YA. “VWAP” means, for any trading day, the daily volume weighted average price of the Company’s common stock for such date on the principal market as reported by Bloomberg L.P. during regular trading hours.

At any time during the Commitment Period the Company may require YA to purchase shares of the Company’s common stock by delivering a written notice to YA setting forth the Advance Shares (as defined in the SEDA) that the Company desires

to issue and sell to YA (the “Advance Notice”). The Company may deliver an Advance Notice for an initial Advance for up to 1,200,000 Advance Shares (the “Initial Advance”). The preliminary purchase price per share for such shares shall be 100% of the average daily VWAP for the five consecutive trading days immediately prior to the date of the Advance Notice (the “Preliminary Purchase Price”).

Pursuant to the SEDA, we currently intend to use the net proceeds from any sale of the shares for working capital purposes, including the repayment of outstanding debt. There are no other restrictions on future financing transactions. The SEDA does not contain any right of first refusal, participation rights, penalties or liquidated damages. We are not required to pay any additional amounts to reimburse or otherwise compensate YA in connection with the transaction except for a $10,000 structuring fee.

The issuance activity under the SEDA is summarized below (in thousands):

	Three Months Ended September 30, 2021		Nine Months Ended September 30, 2021
Common shares sold to YA	—		1,700
Proceeds received	$	—	$	10,000

Common Stock Resale Agreement—On April 21, 2021, the Company and Lincoln Park Capital Fund, LLC (“Lincoln Park”), entered into a purchase agreement, pursuant to which the Company may issue or sell to Lincoln Park up to 8,893,565 shares of the Company’s common stock from time to time during the term of the purchase agreement. Concurrently with entering into the Purchase Agreement, the Company also entered into a registration rights agreement with Lincoln Park, pursuant to which it agreed to provide Lincoln Park with certain registration rights related to the shares issued under the Purchase Agreement.

Upon entering into the purchase agreement, the Company issued 15,000 shares of the Company’s common stock as consideration for Lincoln Park’s execution and delivery of the purchase agreement. The issuance activity under the Lincoln Park agreement is summarized below (in thousands):

	Three Months Ended September 30, 2021		Nine Months Ended September 30, 2021
Common shares sold to Lincoln Park	—		766
Additional commitment shares	—		15
Total common shares issued to Lincoln Park	—		781
Proceeds received	$	—	$	4,217

At-the-Market Equity Distribution Agreement—On May 25, 2021, the Company entered into an equity distribution agreement with Virtu Americas LLC (“Virtu”), to sell from time to time shares of the Company’s common stock having an aggregate offering price of up to $50 million (the “Virtu May 2021 EDA”). We will pay Virtu a commission of approximately 1.0% of the gross sales price of the shares of our common stock sold. The Company may also sell some or all of the shares of our common stock to Virtu as principal for its own account at a price agreed upon at the time of sale.

The issuance activity under the Virtu May 2021 EDA is summarized below (in thousands):

	Three Months Ended September 30, 2021		Nine Months Ended September 30, 2021
Common shares issued	2,367		8,339
Gross proceeds received	$	13,421	$	50,000
Commissions and other expenses	134		500
Net proceeds	$	13,287	$	49,500

On July 12, 2021, the Company entered into a second equity distribution agreement with Virtu to sell from time to time shares of our common stock having an aggregate offering price of up to $100 million (the “Virtu July 2021 EDA”). We will pay Virtu a commission of approximately 1.0% of the gross sales price of the shares of our common stock sold. The Company may also sell some or all of the shares of our common stock to Virtu as principal for its own account at a price agreed upon at the time of sale.

The issuance activity under the Virtu July 2021 EDA is summarized below (in thousands):

	Three Months Ended September 30, 2021		Nine Months Ended September 30, 2021
Common shares issued	4,183		4,183
Gross proceeds received	$	21,363	$	21,363
Commissions and other expenses	214		214
Net proceeds	$	21,149	$	21,149

Stock Repurchases—On December 5, 2017, our board of directors reapproved the stock repurchase program pursuant to which the board of directors granted a repurchase authorization to acquire shares of the Company’s common stock, par value $0.01 per share having an aggregate value of up to $50 million. The board of directors’ authorization replaced any previous repurchase authorizations. No shares were repurchased during the nine months ended September 30, 2021 and 2020. As of September 30, 2021, $50 million remains authorized by the board of directors pursuant to the December 5, 2017 approval.

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Preferred Stock

9 Months Ended

Sep. 30, 2021

Temporary Equity Disclosure [Abstract]

Preferred Stock

Preferred Stock

5.50% Series B Cumulative Convertible Preferred Stock

Each share of our 5.50% Series B Cumulative Convertible Preferred Stock (the “Series B Convertible Preferred Stock”) is convertible at any time, at the option of the holder, into a number of whole shares of common stock at a conversion price of $18.70 (which represents a conversion rate of 1.3372 shares of our common stock, subject to certain adjustments). The Series B Convertible Preferred Stock is also subject to conversion upon certain events constituting a change of control. Holders of the Series B Convertible Preferred Stock have no voting rights, subject to certain exceptions. The Series B Convertible Preferred Stock dividend for all issued and outstanding shares is set at $1.375 per annum per share.

The Company may, at its option, cause the Series B Convertible Preferred Stock to be converted in whole or in part, on a pro-rata basis, into fully paid and nonassessable shares of the Company’s common stock at the conversion price, provided that the “Closing Bid Price” (as defined in the Articles Supplementary) of the Company’s common stock shall have equaled or exceeded 110% of the conversion price for the immediately preceding 45 consecutive trading days ending three days prior to the date of notice of conversion.

Additionally, the Series B Convertible Preferred Stock contains cash redemption features that consist of: 1) an optional redemption in which on or after June 11, 2020, the Company may redeem shares of the Series B Convertible Preferred Stock, in whole or in part, for cash at a redemption price of $25.00 per share, plus any accumulated, accrued and unpaid dividends; 2) a special optional redemption, in which on or prior to the occurrence of a Change of Control (as defined), the Company may redeem shares of the Series B Convertible Preferred Stock, in whole or in part, for cash at a redemption price of $25.00 per share; and 3) a REIT Termination Event and Listing Event Redemption, in which at any time (i) a REIT Termination Event (defined below) occurs or (ii) the Company’s common stock fails to be listed on the NYSE, NYSE American, or NASDAQ, or listed or quoted on an exchange or quotation system that is a successor thereto (each a “National Exchange”), the holder of Series B Convertible Preferred Stock shall have the right to require the Company to redeem any or all shares of Series B Convertible Preferred Stock at 103% of the liquidation preference ($25.00 per share, plus any accumulated, accrued, and unpaid dividends) in cash.

A REIT Termination Event, shall mean the earliest of:

(i)    filing of income tax return where the Company does not compute its income as a REIT;

(ii)    stockholders’ approval on ceasing to be qualified as a REIT;

(iii)    board of directors’ approval on ceasing to be qualified as a REIT;

(iv)    board’s determination based on the advice of counsel to cease to be qualified as a REIT; or

(v)    determination within the meaning of Section 1313(a) of the Code to cease to be qualified as a REIT.

On December 4, 2019, we entered into equity distribution agreements with certain sales agents to sell from time to time shares of our Series B Convertible Preferred Stock having an aggregate offering price of up to $40.0 million. Sales of shares of our Series B Convertible Preferred Stock may be made in negotiated transactions or transactions that are deemed to be “at-the-market” offerings as defined in Rule 415 of the Securities Act of 1933, as amended (the “Securities Act”), including sales made directly on the NYSE, the existing trading market for our Series B Convertible Preferred Stock, or sales made to or through a market maker other than on an exchange or through an electronic communications network. We will pay each of the sales

agents a commission, which in each case shall not be more than 2.0% of the gross sales price of the shares of our Series B Convertible Preferred Stock sold through such sales agents. As of September 30, 2021, we have sold approximately 65,000 shares of our Series B Convertible Preferred Stock and received proceeds of approximately $1.2 million under this program.

The issuance activity is summarized below (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Series B Convertible Preferred Stock shares issued	—		—		—		23
Gross proceeds received	$	—	$	—	$	—	$	439
Commissions and other expenses	—		—		—		7
Net proceeds	$	—	$	—	$	—	$	432

Series B Convertible Preferred Stock does not meet the requirements for permanent equity classification prescribed by the authoritative guidance because of certain cash redemption features that are outside our control. As such, the Series B Convertible Preferred Stock is classified outside of permanent equity.

The following table summarizes dividends declared (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Series B Convertible Preferred Stock	$	1,058	$	1,729	$	3,689	$	5,189

During 2021, Braemar entered into privately negotiated exchange agreements with certain holders of the Series B Convertible Preferred Stock, in reliance on Section 3(a)(9) of the Securities Act. The table below summarizes the activity (in thousands):

	Three Months Ended September 30, 2021		Nine Months Ended September 30, 2021
	Preferred Shares Tendered	Common Shares Issued	Preferred Shares Tendered	Common Shares Issued
Series B Convertible Preferred Stock	30	120	1,953	7,291

Series E Redeemable Preferred Stock

On April 2, 2021, the Company entered into equity distribution agreements with certain sales agents to sell from time-to-time shares of the Series E Redeemable Preferred Stock (the “Series E Preferred Stock”). Pursuant to such equity distribution agreements, the Company is offering a maximum of 20,000,000 shares of Series E Preferred Stock in a primary offering price of $25.00 per share. The Company is also offering a maximum of 8,000,000 shares of the Series E Preferred Stock pursuant to a dividend reinvestment plan (the “DRIP”) at $25.00 per share (the “Stated Value”).

The Series E Preferred Stock ranks senior to all classes or series of the Company’s common stock and future junior securities, on a parity with each series of the Company’s outstanding preferred stock (the Series B Convertible Preferred stock, the Series D Preferred Stock and the Series M Preferred Stock (as defined below)) and with any future parity securities and junior to future senior securities and to all of the Company’s existing and future indebtedness, with respect to the payment of dividends and the distribution of amounts upon liquidation, dissolution or winding up of the Company’s affairs.

Holders of the Series E Preferred Stock shall have the right to vote for the election of directors of the Company and on all other matters requiring stockholder action by the holders of the common stock, each share being entitled to vote to the same extent as one share of the Company’s common stock, and all such shares voting together as a single class. If and whenever dividends on any shares of the Series E Preferred Stock shall be in arrears for 18 or more monthly periods, whether or not such quarterly periods are consecutive the number of directors then constituting the Board shall be increased by two and the holders of such shares of Series E Preferred Stock shall be entitled to vote for the election of the additional directors of the Company who shall each be elected for one-year terms.

Each share is redeemable at any time, at the option of the holder, at a redemption price of $25.00 per share, plus any accumulated, accrued, and unpaid dividends, less a redemption fee. Starting on the second anniversary, each share is redeemable at any time, at the option of the Company, at a redemption price of $25.00 per share, plus any accumulated, accrued, and unpaid dividends (with no redemption fee). The Series E Preferred Stock is also subject to conversion upon certain

events constituting a change of control. Upon such change of control events, holders have the option to convert their shares of Series E Preferred Stock into a maximum of 5.69476 shares of our common stock.

The redemption fee shall be an amount equal to:

•8.0% of the stated value of $25.00 per share (the “Stated Value”) beginning on the Original Issue Date (as defined in the Articles Supplementary) of the shares of the Series E Preferred Stock to be redeemed;

•5.0% of the Stated Value beginning on the second anniversary from the Original Issue Date of the shares of the Series E Preferred Stock to be redeemed; and

•0% of the Stated Value beginning on the third anniversary from the Original Issue Date of the shares of the Series E Preferred Stock to be redeemed.

The Company has the right, in its sole discretion, to redeem the shares in cash, or in an equal of shares of common stock or any combination thereof, calculated based on the closing price per share for the single trading day prior to the date of redemption.

The Series E Preferred Stock cash dividends are as follows:

•8.0% per annum of the Stated Value beginning on the date of the first settlement of the Series E Preferred Stock (the “Date of Initial Closing”);

•7.75% per annum of the Stated Value beginning on the first anniversary from the Date of Initial Closing; and

•7.5% per annum of the Stated Value beginning on the second anniversary from the Date of Initial Closing.

Dividends will be authorized and declared on a monthly basis and payable in arrears on the 15th of each month to holders of record at the close of business on the last business day of each month immediately preceding the applicable thereafter dividend payment date. Dividends will be computed on the basis of twelve 30-day months and a 360-day year.

The Company has a DRIP that allows for participating holders to have their Series E Preferred Stock dividend distributions automatically reinvested in additional shares of the Series E Preferred Stock at a price of $25.00 per share.

The issuance activity of the Series E Preferred Stock is summarized below (in thousands):

	Three Months Ended September 30,		Nine Months Ended September 30,
	2021		2021
Series E Preferred Stock shares issued	266		266
Net proceeds	$	5,976	$	5,976

The Series E Preferred Stock does not meet the requirements for permanent equity classification prescribed by the authoritative guidance because of certain cash redemption features that are outside of the Company’s control. As such, the Series E Preferred Stock is classified outside of permanent equity.

At the date of issuance, the carrying amount of the Series E Preferred Stock was less than the redemption value. As a result of the Company’s determination that redemption is probable the carrying value will be increased to the redemption amount each reporting period.

The redemption value adjustment of Series E Preferred Stock is summarized below (in thousands):

	September 30, 2021		December 31, 2020
Series E Preferred Stock	$	6,110	$	—
Adjustments to Series E Preferred Stock (1)	$	1,906	$	—

________

(1)    Reflects the excess of the redemption value over the accumulated carrying value.

The following table summarizes dividends declared (in thousands):

	Three Months Ended September 30,	Nine Months Ended September 30,
	2021	2021
Series E Preferred Stock	90	90

Series M Redeemable Preferred Stock

On April 2, 2021, the Company entered into equity distribution agreements with certain sales agents to sell from time-to-time shares of the Series M Redeemable Preferred Stock (the “Series M Preferred Stock”). Pursuant to such equity distribution agreements, the Company is offering a maximum of 20,000,000 shares of the Series M Preferred Stock (par value $0.01) in a primary offering price of $25.00 per share (or “Stated Value”). The Company is also offering a maximum of 8,000,000 shares of Series M Preferred Stock pursuant to the DRIP at $25.00 per share.

The Series M Preferred Stock ranks senior to all classes or series of the Company’s common stock and future junior securities, on a parity with each series of the Company’s outstanding preferred stock (the Series B Convertible Preferred Stock, the Series D Preferred Stock and the Series E Preferred Stock) and with any future parity securities and junior to future senior securities and to all of the Company’s existing and future indebtedness, with respect to the payment of dividends and the distribution of amounts upon liquidation, dissolution or winding up of the Company’s affairs.

Holders of the Series M Preferred Stock shall have the right to vote for the election of directors of the Company and on all other matters requiring stockholder action by the holders of the common stock, each share being entitled to vote to the same extent as one share of the Company’s common stock, and all such shares voting together as a single class. If and whenever dividends on any shares of Series E Preferred Stock shall be in arrears for 18 or more monthly periods, whether or not such quarterly periods are consecutive the number of directors then constituting the Board shall be increased by two and the holders of such shares of Series M Preferred Stock shall be entitled to vote for the election of the additional directors of the Company who shall each be elected for one-year terms.

The redemption fee shall be an amount equal to:

•1.5% of the Stated Value of $25.00 per share beginning on the Series M Original Issue Date (as defined below) of the shares of Series M Preferred Stock to be redeemed; and

•0% of the Stated Value beginning on the first anniversary from the Original Issue Date of the shares of Series M Preferred Stock to be redeemed.

The Company has the right, in its sole discretion, to redeem the shares in cash, or in an equal of shares of common stock or any combination thereof, calculated based on the closing price per share for the single trading day prior to the date of redemption.

Holders of Series M Preferred Stock are entitled to receive cumulative cash dividends at the initial rate of 8.2% per annum of the Stated Value of $25.00 per share (equivalent to an annual dividend rate of $2.05 per share). Beginning one year from the date of original issuance of each share of Series M Preferred Stock (the “Series M Original Issue Date of Series M”) and on each one-year anniversary thereafter for such share of Series M Preferred Stock, the dividend rate shall increase by 0.10% per annum; provided, however, that the dividend rate for any share of Series M Preferred Stock shall not exceed 8.7% per annum of the Stated Value.

Dividends will be authorized and declared on a monthly basis and payable in arrears on the 15th of each month to holders of record at the close of business on the last business day of each month immediately preceding the applicable dividend payment date. Dividends will be computed on the basis of twelve 30-day months and a 360-day year.

The Company has a DRIP that allows for participating holders to have their Series M Preferred Stock dividend distributions automatically reinvested in additional shares of the Series M Preferred Stock at a price of $25.00 per share.

The issuance activity of Series M Preferred Stock is summarized below (in thousands):

	Three Months Ended September 30,		Nine Months Ended September 30,
	2021		2021
Series M Preferred Stock shares issued	15		15
Net proceeds	$	355	$	355

The Series M Preferred Stock does not meet the requirements for permanent equity classification prescribed by the authoritative guidance because of certain cash redemption features that are outside the Company’s control. As such, the Series M Preferred Stock is classified outside of permanent equity.

At the date of issuance, the carrying amount of the Series M Preferred Stock was less than the redemption value. As a result of the Company’s determination that redemption is probable the carrying value will be increased to the redemption amount each reporting period.

The redemption value adjustment of Series M Preferred stock is summarized below (in thousands):

	September 30, 2021		December 31, 2020
Series M Preferred Stock	$	361	$	—
Adjustments to Series M Preferred Stock (1)	$	111	$	—

________

(1)    Reflects the excess of the redemption value over the accumulated carrying value.

The following table summarizes dividends declared (in thousands):

	Three Months Ended September 30,		Nine Months Ended September 30,
	2021		2021
Series M Preferred Stock	$	4	$	4

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Related Party Transactions

9 Months Ended

Sep. 30, 2021

Related Party Transactions [Abstract]

Related Party Transactions

Related Party Transactions

Ashford Inc.

Advisory Agreement

Ashford LLC, a subsidiary of Ashford Inc., acts as our advisor. Our chairman, Mr. Monty Bennett, also serves as chairman of the board of directors and chief executive officer of Ashford Inc. Under our advisory agreement, we pay advisory fees to Ashford LLC. We pay a monthly base fee equal to 1/12th of the sum of (i) 0.70% of the total market capitalization of our company for the prior month, plus (ii) the Net Asset Fee Adjustment (as defined in our advisory agreement), if any, on the last day of the prior month during which our advisory agreement was in effect; provided, however in no event shall the base fee for any month be less than the minimum base fee as provided by our advisory agreement. The base fee is payable on the 5th business day of each month.

The minimum base fee for Braemar for each month will be equal to the greater of:

▪90% of the base fee paid for the same month in the prior year; and

▪1/12th of the G&A Ratio (as defined) multiplied by the total market capitalization of Braemar.

We are also required to pay Ashford LLC an incentive fee that is measured annually (or for a stub period if the advisory agreement is terminated at other than year-end). Each year that our annual total stockholder return exceeds the average annual total stockholder return for our peer group we pay Ashford LLC an incentive fee over the following three years, subject to the Fixed Charge Coverage Ratio (“FCCR”) Condition, as defined in the advisory agreement, which relates to the ratio of adjusted EBITDA to fixed charges. We also reimburse Ashford LLC for certain reimbursable overhead and internal audit, risk management advisory and asset management services, as specified in the advisory agreement. We also recorded equity-based compensation expense for equity grants of common stock and LTIP units awarded to officers and employees of Ashford LLC in connection with providing advisory services.

The following table summarizes the advisory services fees incurred (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Advisory services fee
Base advisory fee	$	2,758	$	2,386	$	7,981	$	7,579
Reimbursable expenses (1)	694		404		1,696		1,360
Equity-based compensation (2)	2,994		1,785		6,666		5,606
Incentive fee	(1,637)		—		—		—
Total	$	4,809	$	4,575	$	16,343	$	14,545

________

(1)Reimbursable expenses include overhead, internal audit, risk management advisory and asset management services.

(2)    Equity-based compensation is associated with equity grants of Braemar’s common stock, PSUs, LTIP units and Performance LTIP units awarded to officers and employees of Ashford LLC.

Pursuant to the Company's hotel management agreements with each hotel management company, the Company bears the economic burden for casualty insurance coverage. Under the advisory agreement, Ashford Inc. secures casualty insurance policies to cover Braemar, Ashford Hospitality Trust, Inc. (“Ashford Trust”), their hotel managers, as needed, and Ashford Inc. The total loss estimates included in such policies are based on the collective pool of risk exposures from each party. Ashford Inc.'s risk management department manages the casualty insurance program. At the beginning of each year, Ashford Inc.'s risk management department collects funds from Braemar, Ashford Trust and their respective hotel management companies, to fund the casualty insurance program as needed, on an allocated basis.

Lismore

On March 20, 2020, the Company entered into an agreement with Lismore, a subsidiary of Ashford Inc., to engage Lismore to seek modifications, forbearances or refinancings of the Company’s loans (the “Lismore Agreement”). The Lismore Agreement was terminated effective March 20, 2021.

Upon entering into the agreement with Lismore, the Company made an initial payment of approximately $1.4 million. The Company paid approximately $1.4 million related to periodic installments of which $683,000 was expensed in accordance with the agreement. The remaining $681,000 was set off against the cash payment of the base advisory fee per the agreement upon contract termination in March 2021. Further, the Company paid approximately $1.4 million in success fees in connection with signed forbearance or other agreements. In total, the Company paid approximately $4.1 million under the Lismore Agreement.

For the three and nine months ended September 30, 2021, the Company recognized expense of $0 and $341,000, respectively. For the three and nine months ended September 30, 2020, the Company recognized expense of $1.2 million and $2.7 million, respectively. These expenses are included in “write-off of loan costs and exit fees” in the condensed consolidated statements of operations.

The Company engaged Lismore to negotiate, on the Company’s behalf, one or more modifications to the terms of the mortgage loan assumed in connection with the acquisition of the Mr. C Beverly Hills Hotel. Upon closing of the hotel, the Company paid Lismore a debt placement fee of $150,000.

Ashford Securities

On September 25, 2019, Ashford Inc. announced the formation of Ashford Securities LLC (“Ashford Securities”) to raise retail capital in order to grow its existing and future platforms. In conjunction with the formation of Ashford Securities, Braemar has entered into a contribution agreement (the “Initial Contribution Agreement”) with Ashford Inc. pursuant to which Braemar has agreed to contribute, with Ashford Trust, up to $15.0 million to fund the operations of Ashford Securities. Costs for all operating expenses of Ashford Securities that were contributed by Ashford Trust and Braemar will be expensed as incurred. These costs were allocated initially to Ashford Trust and Braemar based on an allocation percentage of 75% to Ashford Trust and 25% Braemar. Upon reaching the earlier of $400 million in aggregate non-listed preferred equity offerings raised or June 10, 2023, there will be a true up (the “Initial True-up Date”) between Ashford Trust and Braemar, whereby the actual capital contributions contributed by each company will be based on the actual amount of capital raised by Ashford Trust and Braemar, respectively. After the Initial True-Up Date, the capital contributions will be allocated between Ashford Trust and Braemar quarterly based on the actual capital raised through Ashford Securities.

On December 31, 2020, an Amended and Restated Contribution Agreement (the “Amended and Restated Contribution Agreement”) was entered into by Ashford Inc., Ashford Trust and Braemar with respect to expenses to be reimbursed by Ashford Securities. The Initial True-Up Date did not occur, and beginning on the effective date of the Amended and Restated Contribution Agreement, costs will be allocated based upon an allocation percentage of 50% to Ashford Inc., 50% to Braemar and 0% to Ashford Trust. Upon reaching the earlier of $400 million in aggregate non-listed preferred equity offerings raised, or June 10, 2023, there will be an Amended and Restated true up (the “Amended and Restated True-up Date”) among Ashford Inc., Ashford Trust and Braemar whereby the actual expense reimbursement paid by each company will be based on the actual amount of capital raised by Ashford Inc., Ashford Trust and Braemar, respectively. After the Amended and Restated True-Up Date, the expense reimbursements will be allocated among Ashford Inc., Ashford Trust and Braemar quarterly based on the actual capital raised through Ashford Securities. Additionally, Braemar’s aggregate Capital Contributions under the Initial Contribution Agreement and the Amended and Restated Contribution Agreement shall not exceed $3.75 million unless otherwise agreed to in writing by Braemar.

As of September 30, 2021, Braemar has funded approximately $2.8 million. Additionally, as of September 30, 2021, $144,000 of the pre-funded amount was included in “other assets” on our condensed consolidated balance sheets.

The table below summarizes the amount Braemar has expensed related to reimbursed operating expenses of Ashford Securities (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
Line Item	2021		2020		2021		2020
Corporate, general and administrative	$	642	$	228	$	1,505	$	558

Enhanced Return Funding Program

Concurrent with Amendment No. 1 to the Fifth Amended and Restated Advisory Agreement with Ashford Inc. (“Amendment No. 1”), on January 15, 2019, the Company also entered into the Enhanced Return Funding Program Agreement (the “ERFP Agreement”) with Ashford Inc. The “key money investments” concept previously contemplated by our advisory agreement was replaced with the ERFP Agreement. The Fifth Amended and Restated Advisory Agreement was also amended to name Ashford Inc. and its subsidiaries as the Company’s sole and exclusive provider of asset management, design and construction and other services offered by Ashford Inc. or any of its subsidiaries. The independent members of our board of directors and the independent members of the board of directors of Ashford Inc., with the assistance of separate and independent legal counsel, engaged to negotiate the ERFP Agreement on behalf of Ashford Inc. and Braemar, respectively.

The ERFP Agreement generally provides that Ashford LLC will provide funding to facilitate the acquisition of properties by Braemar OP that are recommended by Ashford LLC, in an aggregate amount of up to $50 million (subject to increase to up to $100 million by mutual agreement). Each funding will equal 10% of the property acquisition price and will be made either at the time of the property acquisition or at any time generally within the two-year period following the date of such acquisition, in exchange for FF&E for use at the acquired property or any other property owned by Braemar OP.

The initial term of the ERFP Agreement was two years (the “Initial Term”). At the end of the Initial Term, the ERFP Agreement automatically renewed for one year and shall automatically renew for successive one-year periods (each such period a “Renewal Term”) unless either Ashford Inc. or Braemar provides written notice to the other at least sixty days in advance of the expiration of the Initial Term or Renewal Term, as applicable, that such notifying party intends not to renew the ERFP Agreement.

During the second quarter of 2021, the Company sold approximately $1.6 million of hotel FF&E from Braemar hotel properties to Ashford LLC, which was subsequently leased back to the Company rent-free. In accordance with ASC 842, the Company evaluated the transactions and concluded that the transactions qualified as sales. As a result, the Company recorded an aggregate gain of $0 and $197,000 for the three and nine months ended September 30, 2021, respectively. The gains are recorded in “gain (loss) on insurance settlement, disposition of assets and sale of hotel properties” in our condensed consolidated statements of operations.

In the second quarter of 2021, upon expiration of an ERFP lease, the Company purchased the underlying FF&E from Ashford Inc. at fair value for $144,000, which was paid during the third quarter of 2021.

Design and Construction Services

In connection with Ashford Inc.’s August 8, 2018 acquisition of Remington Lodging’s design and construction business, we entered into a design and construction services agreement with Ashford Inc.’s subsidiary, Premier Project Management LLC (“Premier”), pursuant to which Premier provides design and construction services to our hotels, including construction management, interior design, architectural services, and the purchasing, freight management, and supervision of installation of FF&E and related services. Pursuant to the design and construction services agreement, we pay Premier: (a) design and construction fees of up to 4% of project costs; and (b) for the following services: (i) architectural (6.5% of total construction costs); (ii) construction management for projects without a general contractor (10% of total construction costs); (iii) interior design (6% of the purchase price of the FF&E designed or selected by Premier); and (iv) FF&E purchasing (8% of the purchase price of FF&E purchased by Premier; provided that if the purchase price exceeds $2.0 million for a single hotel in a calendar year, then the purchasing fee is reduced to 6% of the FF&E purchase price in excess of $2.0 million for such hotel in such calendar year). On March 20, 2020, we amended the design and construction services agreement to provide that Premier’s fees shall be paid by the Company to Premier upon the completion of any work provided by third-party vendors to the Company.

Hotel Management Services

On November 6, 2019, Ashford Inc. completed the acquisition of Remington Lodging’s hotel management business. Following the acquisition, hotel management services are provided by Remington Hotels, a subsidiary of Ashford Inc., under the respective hotel management agreement with each customer, including Ashford Trust and Braemar.

At September 30, 2021, Remington Hotels managed four of our 14 hotel properties.

We pay monthly hotel management fees equal to the greater of approximately $14,000 per hotel (increased annually based on consumer price index adjustments) or 3% of gross revenues as well as annual incentive management fees, if certain operational criteria were met and other general and administrative expense reimbursements primarily related to accounting services.

Pursuant to the terms of the Letter Agreement dated March 13, 2020 (the “Hotel Management Letter Agreement”), in order to allow Remington Hotels to better manage its corporate working capital and to ensure the continued efficient operation of our hotels, we agreed to pay the base fee and to reimburse all expenses on a weekly basis for the preceding week, rather than on a monthly basis. The Hotel Management Letter Agreement went into effect on March 13, 2020 and will continue until terminated by us.

We also have a mutual exclusivity agreement with Remington Hotels, pursuant to which: (i) we have agreed to engage Remington Hotels to provide management services with respect to any hotel we acquire or invest in, to the extent we have the right and/or control the right to direct the management of such hotel; and (ii) Remington Hotels has agreed to grant us a right of first refusal to purchase any opportunity to develop or construct a hotel that it identifies that meets our initial investment guidelines. We are not, however, obligated to engage Remington Hotels if our independent directors either: (i) unanimously vote to hire a different manager or developer; or (ii) by a majority vote elect not to engage such related party because either special circumstances exist such that it would be in the best interest of our Company not to engage such related party, or, based on related party’s prior performance, it is believed that another manager could perform the management or other duties materially better.

Ashford Trust

As of September 30, 2021, the Company has an $800,000 receivable from Ashford Trust, included in “due from related parties, net.” The receivable relates to a legal settlement between Ashford Trust and the City of San Francisco regarding a transfer tax matter associated with the transfer of The Clancy from Ashford Trust to Braemar upon Braemar’s 2013 spin-off from Ashford Trust. The transfer taxes were initially paid by Braemar at the time of the spin-off. The $800,000 gain is included in “(gain) loss on legal settlements” on the condensed consolidated statements of operations.

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Commitments and Contingencies

9 Months Ended

Sep. 30, 2021

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Restricted Cash—Under certain management and debt agreements for our hotel properties existing at September 30, 2021, escrow payments are required for insurance, real estate taxes and debt service. In addition, for certain properties based on the terms of the underlying debt and management agreements, we escrow 4% to 5% of gross revenues for capital improvements.

Licensing Fees—In conjunction with the Mr. C Beverly Hills Hotel acquisition on August 5, 2021, we entered into an Intellectual Property Sublease Agreement, which allows us to continue to use certain proprietary marks associated with the Mr. C brand name. In return, we pay licensing fees of: (i) 1% of total operating revenue; (ii) 2% of gross food and beverage revenues; and (iii) 25% of food and beverage profits. The agreement expires on August 4, 2022.

The table below summarizes the licensing fees incurred (in thousands):

Line Item	Three Months Ended September 30, 2021		Nine Months Ended September 30, 2021
Other hotel expenses	$	53	$	53

Management Fees—Under hotel management agreements for our hotel properties existing at September 30, 2021, we pay a monthly hotel management fee equal to the greater of approximately $15,000 per hotel (increased annually based on consumer price index adjustments) or 3% of gross revenues, or in some cases 2.5% to 5.0% of gross revenues, as well as annual incentive management fees, if applicable. These management agreements expire from December 2023 through December 2065, with renewal options. If we terminate a management agreement prior to its expiration, we may be liable for estimated management fees through the remaining term, liquidated damages or, in certain circumstances, we may substitute a new management agreement.

Income Taxes—We and our subsidiaries file income tax returns in the federal jurisdiction and various states. Tax years 2017 through 2020 remain subject to potential examination by certain federal and state taxing authorities.

Litigation—On October 24, 2019, the Company provided notice to Accor of the material breach of Accor’s responsibilities under the Accor management agreement for the Sofitel Chicago Magnificent Mile at 20 East Chestnut Street in Chicago, Illinois. On November 7, 2019, Accor filed a complaint against Ashford TRS Chicago II in the Supreme Court of the State of New York, New York County, seeking a declaratory judgment that no breach has occurred. Accor’s complaint was dismissed on or about February 27, 2020. On January 6, 2020, Ashford TRS Chicago II filed a complaint against Accor in the Supreme Court of the State of New York, New York County, alleging breach of the Accor management agreement and seeking declaration of its right to terminate the Accor management agreement. On July 20, 2020, Accor filed an Amended Answer and Counterclaims against Ashford TRS Chicago II. Accor asserts two causes of action: First, Accor asserts a counterclaim for declaratory judgment that Accor correctly calculated the amount payable to Ashford TRS Chicago II under the management agreement to “cure” Accor’s performance test failure (the “Cure Amount”). Second, Accor asserts a counterclaim for breach of contract on the basis that Ashford TRS Chicago II breached the management agreement by wrongfully maintaining that the Cure Amount for the 2018 and 2019 Performance Test failure is $1,031,549 instead of $535,120. As of September 30, 2021, no amounts have been accrued.

One of the Company’s hotel management companies is currently involved in litigation regarding its employment policies and practices at multiple California hotels, including one of the Company’s hotels. The Company believes it is probable that the litigation will result in a loss due to a potential pre-trial settlement, in which case the Company estimates its potential loss will be approximately $500,000; however, it is entitled to indemnification for a portion of such loss. As of September 30, 2021, approximately $500,000 has been accrued.

In June 2020, each of the Company, Ashford Trust, Ashford Inc., and Lismore, a subsidiary of Ashford Inc. (collectively with the Company, Ashford Trust, Ashford Inc. and Lismore, the “Ashford Companies”), received an administrative subpoena from the SEC. The Company’s administrative subpoena requires the production of documents and other information since January 1, 2018 relating to, among other things, (1) related party transactions among the Ashford Companies (including the Lismore Agreement between the Company and Lismore pursuant to which the Company engaged Lismore to negotiate the refinancing, modification or forbearance of certain mortgage debt) or between any of the Ashford Companies and any officer, director or owner of the Ashford Companies or any entity controlled by any such person, and (2) the Company’s accounting policies, procedures, and internal controls related to such related party transactions. In addition, in October 2020, Mr. Monty J. Bennett, chairman of our board of directors, received an administrative subpoena from the SEC requiring testimony and the

production of documents and other information substantially similar to the requests in the subpoenas received by the Ashford Companies. The Company and Mr. Monty J. Bennett are responding to the administrative subpoenas.

On December 20, 2016, a class action lawsuit was filed against one of the Company’s hotel management companies in the Superior Court of the State of California in and for the County of Contra Costa alleging violations of certain California employment laws, which class action affects two hotels owned by subsidiaries of the Company. The court has entered an order granting class certification with respect to: (1) a statewide class of non-exempt employees of our manager who were allegedly deprived of rest breaks as a result of our manager’s previous written policy requiring its employees to stay on premises during rest breaks; and (2) a derivative class of non-exempt former employees of our manager who were not paid for allegedly missed breaks upon separation from employment. Notices to potential class members were sent out on February 2, 2021. Potential class members had until April 4, 2021 to opt out of the class; however, the total number of employees in the class has not been definitively determined and is the subject of continuing discovery. While we believe it is reasonably possible that we may incur a loss associated with this litigation, because there remains uncertainty under California law with respect to a significant legal issue, discovery relating to class members continues, and the trial judge retains discretion to award lower penalties than set forth in the applicable California employment laws, we do not believe any potential loss to the Company is reasonably estimable at this time. As of September 30, 2021, no amounts have been accrued.

We are also engaged in other legal proceedings that have arisen but have not been fully adjudicated. To the extent the claims giving rise to these legal proceedings are not covered by insurance, they relate to the following general types of claims: employment matters, tax matters and matters relating to compliance with applicable law (for example, the ADA and similar state laws). The likelihood of loss from these legal proceedings is based on the definitions within contingency accounting literature. We recognize a loss when we believe the loss is both probable and reasonably estimable. Based on the information available to us relating to these legal proceedings and/or our experience in similar legal proceedings, we do not believe the ultimate resolution of these proceedings, either individually or in the aggregate, will have a material adverse effect on our consolidated financial position, results of operations, or cash flow. However, our assessment may change depending upon the development of these legal proceedings, and the final results of these legal proceedings cannot be predicted with certainty. If we do not prevail in one or more of these legal matters, and the associated realized losses exceed our current estimates of the range of potential losses, our consolidated financial position, results of operations, or cash flows could be materially adversely affected in future periods.

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Segment Reporting	9 Months Ended
	Sep. 30, 2021
Segment Reporting [Abstract]
Segment Reporting	Segment ReportingWe operate in one business segment within the hotel lodging industry: direct hotel investments. Direct hotel investments refers to owning hotel properties through either acquisition or new development. We report operating results of direct hotel investments on an aggregate basis as substantially all of our hotel investments have similar economic characteristics and exhibit similar long-term financial performance. As of September 30, 2021 and December 31, 2020, all of our hotel properties were in the U.S. and its territories.

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Significant Accounting Policies (Policies)

9 Months Ended

Sep. 30, 2021

Accounting Policies [Abstract]

Basis of Presentation and Principles of Consolidation

Basis of Presentation and Principles of Consolidation—The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. These condensed consolidated financial statements include the accounts of Braemar Hotels & Resorts Inc., its majority-owned subsidiaries, and its majority-owned entities in which it has a controlling interest. All significant intercompany accounts and transactions between consolidated entities have been eliminated in these condensed consolidated financial statements. We have condensed or omitted certain information and footnote disclosures normally included in financial statements presented in accordance with GAAP in the accompanying unaudited condensed consolidated financial statements. We believe the disclosures made herein are adequate to prevent the information presented from being misleading. However, the financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our 2020 Annual Report on Form 10-K, as originally filed with the Securities and Exchange Commission (“SEC”) on March 5, 2021.

Braemar OP is considered to be a variable interest entity (“VIE”), as defined by authoritative accounting guidance. A VIE must be consolidated by a reporting entity if the reporting entity is the primary beneficiary because it has (i) the power to direct the VIE’s activities that most significantly impact the VIE’s economic performance and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE. All major decisions related to Braemar OP that most significantly impact its economic performance, including but not limited to operating procedures with respect to business affairs and any acquisitions, dispositions, financings, restructurings or other transactions with sellers, purchasers, lenders, brokers, agents and other applicable representatives, are subject to the approval of our wholly-owned subsidiary, Braemar OP General Partner LLC, its general partner. As such, we consolidate Braemar OP.

The following items affect reporting comparability of our historical condensed consolidated financial statements:

•historical seasonality patterns at some of our hotel properties cause fluctuations in our overall operating results. Consequently, operating results for the three and nine months ended September 30, 2021, are not necessarily indicative of the results that may be expected for the year ending December 31, 2021.

•on August 5, 2021, we acquired the Mr. C Beverly Hills Hotel and five adjacent luxury residences. The operating results of the hotel property have been included in the results of operations from its acquisition date.

Use of Estimates

Use of Estimates—The preparation of these condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Recently Adopted and Issued Accounting Standards

Recently Adopted Accounting Standards—In January 2020, the Financial Accounting Standards Board’s (“FASB”) issued Accounting Standards Update (“ASU”) 2020-01, Investments – Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815) – Clarifying the Interactions between Topic 321, Topic 323, and Topic 815 (a consensus of the Emerging Issues Task Force) (“ASU 2020-01”), which clarifies the interaction between the accounting for equity securities, equity method investments, and certain derivative instruments. The ASU, among other

things, clarifies that a company should consider observable transactions that require a company to either apply or discontinue the equity method of accounting under Topic 323, Investments—Equity Method and Joint Ventures, for the purposes of applying the measurement alternative in accordance with Topic 321 immediately before applying or upon discontinuing the equity method. ASU 2020-01 is effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years and should be applied prospectively. Early adoption is permitted. We adopted the standard effective January 1, 2021 and the adoption of this standard did not have a material impact on our consolidated financial statements.

Recently Issued Accounting Standards—In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848) (“ASU 2020-04”). ASU 2020-04 contains practical expedients for reference rate reform related activities that impact debt, leases, derivatives and other contracts. The guidance in ASU 2020-04 is optional and may be elected over time as reference rate reform activities occur. In January 2021, the FASB issued ASU 2021-01, Reference Rate Reform (Topic 848): Scope (“ASU 2021-01”) to provide guidance and relief for transitioning to alternative reference rates. ASU 2021-01 is effective immediately for all entities. The Company continues to evaluate the impact of the guidance and may apply the elections as applicable as changes in the market occur.

In August 2020, the FASB issued ASU 2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (“ASU 2020-06”), which simplifies the accounting for certain financial instruments with characteristics of liabilities and equity. This ASU: (1) simplifies the accounting for convertible debt instruments and convertible preferred stock by removing the existing guidance in Accounting Standards Codification (“ASC”) 470-20, Debt: Debt with Conversion and Other Options, that requires entities to account for beneficial conversion features and cash conversion features in equity, separately from the host convertible debt or preferred stock; (2) revises the scope exception from derivative accounting in ASC 815-40 for freestanding financial instruments and embedded features that are both indexed to the issuer’s own stock and classified in stockholders’ equity, by removing certain criteria required for equity classification; and (3) revises the guidance in ASC 260, Earnings Per Share, to require entities to calculate diluted earnings per share (“EPS”) for convertible instruments by using the if-converted method. In addition, entities must presume share settlement for purposes of calculating diluted EPS when an instrument may be settled in cash or shares. For SEC filers, excluding smaller reporting companies, this ASU is effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020. Entities should adopt the guidance as of the beginning of the fiscal year of adoption and cannot adopt the guidance in an interim reporting period. We are currently evaluating the impact that ASU 2020-06 may have on our consolidated financial statements and related disclosures.

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Revenue (Tables)

9 Months Ended

Sep. 30, 2021

Revenue from Contract with Customer [Abstract]

Disaggregation of Revenue

The following tables present our revenue disaggregated by geographical areas (dollars in thousands):

	Three Months Ended September 30, 2021
Primary Geographical Market	Number of Hotels	Rooms		Food and Beverage		Other Hotel		Total
California	6	$	28,838	$	8,024	$	3,626	$	40,488
Colorado	1	4,123		4,152		2,168		10,443
Florida	2	13,738		5,384		4,581		23,703
Illinois	1	5,233		1,196		389		6,818
Pennsylvania	1	3,911		580		243		4,734
Washington	1	6,906		792		550		8,248
Washington, D.C.	1	2,476		512		337		3,325
USVI	1	12,335		3,854		2,229		18,418
Total	14	$	77,560	$	24,494	$	14,123	$	116,177

	Three Months Ended September 30, 2020
Primary Geographical Market	Number of Hotels	Rooms		Food and Beverage		Other Hotel		Total
California	5	$	11,504	$	2,895	$	1,536	$	15,935
Colorado	1	1,688		692		1,659		4,039
Florida	2	7,103		3,175		3,262		13,540
Illinois	1	1,706		240		127		2,073
Pennsylvania	1	1,088		9		58		1,155
Washington	1	1,056		3		118		1,177
Washington, D.C.	1	331		4		292		627
USVI	1	3,642		1,519		1,047		6,208
Total	13	$	28,118	$	8,537	$	8,099	$	44,754

	Nine Months Ended September 30, 2021
Primary Geographical Market	Number of Hotels	Rooms		Food and Beverage		Other Hotel		Total
California	6	$	60,935	$	17,942	$	8,607	$	87,484
Colorado	1	12,058		8,344		6,058		26,460
Florida	2	47,964		18,732		15,311		82,007
Illinois	1	9,607		2,020		792		12,419
Pennsylvania	1	7,568		706		490		8,764
Washington	1	10,980		1,041		1,046		13,067
Washington, D.C.	1	5,711		767		832		7,310
USVI	1	40,897		11,424		7,303		59,624
Total	14	$	195,720	$	60,976	$	40,439	$	297,135

	Nine Months Ended September 30, 2020
Primary Geographical Market	Number of Hotels	Rooms		Food and Beverage		Other Hotel		Total
California	5	$	37,401	$	10,936	$	6,474	$	54,811
Colorado	1	9,955		4,974		4,898		19,827
Florida	2	24,401		12,535		10,292		47,228
Illinois	1	4,638		1,129		490		6,257
Pennsylvania	1	6,088		1,215		377		7,680
Washington	1	4,821		794		540		6,155
Washington, D.C.	1	6,857		3,482		1,174		11,513
USVI	1	10,958		4,352		6,388		21,698
Total	13	$	105,119	$	39,417	$	30,633	$	175,169

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Investments in Hotel Properties, net (Tables)

9 Months Ended

Sep. 30, 2021

Property, Plant and Equipment [Abstract]

Schedule of Investment in Hotel Properties

Investments in hotel properties, net consisted of the following (in thousands):

	September 30, 2021		December 31, 2020
Land	$	480,530	$	455,298
Buildings and improvements	1,222,422		1,190,437
Furniture, fixtures and equipment	122,921		127,692
Construction in progress	9,136		11,422
Residences	12,746		—
Total cost	1,847,755		1,784,849
Accumulated depreciation	(395,753)		(360,259)
Investments in hotel properties, net	$	1,452,002	$	1,424,590

Schedule of Preliminary Estimated Fair Value of the Assets Acquired and Liabilities Assumed in the Acquisition

The following table summarizes the preliminary estimated fair value of the assets acquired and liabilities assumed in the acquisition (in thousands):

Land	$	25,232
Buildings and improvements	35,689
Furniture, fixtures and equipment	758
Residences	12,746
Investments in hotel properties	74,425
Inventories	94
Mortgage loan	(49,815)
	$	24,704
Net other assets (liabilities)	$	(486)

Schedule of Pro Forma Information

The table below summarizes the total revenue and net income (loss) in our condensed consolidated statements of operations for the three and nine months ended September 30, 2021:

	Three Months Ended September 30, 2021		Nine Months Ended September 30, 2021
Total revenue	$	2,272	$	2,272
Net income (loss)	(1,203)		(1,203)

The following table reflects the unaudited pro forma results of operations as if the acquisitions had occurred and the applicable indebtedness was incurred on January 1, 2020, and the removal of $275,000 and $571,000 of non-recurring transaction costs directly attributable to the acquisition for the three and nine months ended September 30, 2021 (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Total revenue	$	117,808	$	46,409	$	303,406	$	181,121
Net income (loss)	$	(7,114)	$	(23,939)	$	(30,418)	$	(97,449)
Net income (loss) attributable to common stockholders	$	(7,898)	$	(20,675)	$	(34,082)	$	(84,203)
Pro Forma income per share;
Basic	$	(0.13)	$	(0.61)	$	(0.70)	$	(2.54)
Diluted	$	(0.13)	$	(0.61)	$	(0.70)	$	(2.54)
Weighted average common shares outstanding (in thousands):
Basic	59,207		33,923		48,954		33,103
Diluted	59,207		33,923		48,954		33,103

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Investment in Unconsolidated Entity (Tables)

9 Months Ended

Sep. 30, 2021

Equity Method Investments and Joint Ventures [Abstract]

Summarized Financial Information

The following table summarizes our carrying value and ownership interest in OpenKey:

	September 30, 2021			December 31, 2020
Carrying value of the investment in OpenKey (in thousands)	$	1,627		$	1,708
Ownership interest in OpenKey	7.8		%	8.2		%

The following table summarizes our equity in earnings (loss) in OpenKey (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
Line Item	2021		2020		2021		2020
Equity in earnings (loss) of unconsolidated entity	$	(68)	$	(58)	$	(198)	$	(138)

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Indebtedness, net (Tables)

9 Months Ended

Sep. 30, 2021

Debt Disclosure [Abstract]

Schedule of Indebtedness, net

Indebtedness, net consisted of the following (dollars in thousands):

Indebtedness	Collateral	Current Maturity	Final Maturity (12)	Interest Rate	September 30, 2021		December 31, 2020
Mortgage loan (3)	Park Hyatt Beaver Creek Resort & Spa	April 2022	April 2022	LIBOR (1) +3.00%	$	67,500	$	67,500
Mortgage loan (4)	The Notary Hotel	June 2022	June 2025	LIBOR (1) + 2.16%	435,000		435,000
	The Clancy
	Sofitel Chicago Magnificent Mile
	Marriott Seattle Waterfront
Mortgage loan (5)	The Ritz-Carlton St. Thomas	August 2022	August 2024	LIBOR (1) + 3.95%	42,500		42,500
Term loan (6)	Equity	October 2022	October 2022	Base Rate (2) + 1.25% to 2.65% or LIBOR (1) + 2.25% to 3.65%	—		61,495
Mortgage loan (7)	The Ritz-Carlton Sarasota	April 2023	April 2023	LIBOR (1) + 2.65%	99,750		100,000
Mortgage loan (7) (8)	Hotel Yountville	May 2023	May 2023	LIBOR (1) + 2.55%	51,000		51,000
Mortgage loan (7) (8)	Bardessono Hotel and Spa	August 2023	August 2023	LIBOR (1) + 2.55%	40,000		40,000
Mortgage loan (7)	The Ritz-Carlton Lake Tahoe	January 2024	January 2024	LIBOR (1) + 2.10%	54,000		54,000
Mortgage loan (9)	Capital Hilton	February 2024	February 2024	LIBOR (1) + 1.70%	195,203		197,229
	Hilton La Jolla Torrey Pines
Mortgage loan (10)	Mr. C Beverly Hills Hotel	August 2024	August 2024	LIBOR (1) + 3.60%	30,000		—
Mortgage loan (7)	Pier House Resort & Spa	September 2024	September 2024	LIBOR (1) + 1.85%	80,000		80,000
Convertible Senior Notes (11)	Equity	June 2026	June 2026	4.50%	86,250		—
					1,181,203		1,128,724
Capitalized default interest and late charges					4,425		7,304
Deferred loan costs, net					(3,997)		(5,434)
Discounts, net					(8,844)		—
Indebtedness, net					$	1,172,787	$	1,130,594

__________________

(1)LIBOR rates were 0.080% and 0.144% at September 30, 2021 and December 31, 2020, respectively.

(2)Base Rate, as defined in the secured term loan agreement, is the greater of (i) the prime rate set by Bank of America, or (ii) federal funds rate + 0.5%, or (iii) LIBOR + 1.0%.

(3)Effective January 9, 2021, we amended this mortgage loan. Terms of the agreement included monthly FF&E escrow deposits being waived from January 2021 through June 2021. This mortgage loan has three one-year extension options, subject to satisfaction of certain conditions, of which the third was exercised in April 2021.

(4)This mortgage loan has five one-year extension options, subject to satisfaction of certain conditions, of which the second was exercised in June 2021.

(5)This mortgage loan has three one-year extension options, subject to satisfaction of certain conditions, of which the first was exercised in August 2021. This mortgage loan has a LIBOR floor of 1.00%.

(6)Effective February 22, 2021, we amended this term loan. In conjunction with the amendment, the interest rate spread increased from a rate of Base Rate + 1.25% - 2.50% or LIBOR + 2.25% - 3.50% to a Base Rate + 1.25% - 2.65% or LIBOR + 2.25% - 3.65%, with a LIBOR floor of 0.50%. On May 18, 2021, we repaid this term loan in full.

(7)Effective December 31, 2020, we amended this mortgage loan. Terms of the agreement included monthly FF&E escrow deposits being waived from January 2021 through December 2021. This mortgage loan has a LIBOR floor of 0.25%.

(8)On September 23, 2021, we amended this mortgage loan. Terms of the agreement included extending the current and final maturity dates by one year.

(9)Effective March 5, 2021, we amended this mortgage loan. Terms of the agreement included monthly FF&E escrow deposits waived through July 1, 2021.

(10)This mortgage loan has a LIBOR floor of 1.50%.

(11)On May 18, 2021, we executed a purchase agreement to sell convertible senior notes in a private offering. In conjunction with the private offering, we sold convertible senior notes with an aggregate principal amount of $86.25 million.

(12)The final maturity date assumes all available extensions options will be exercised.

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Derivative Instruments (Tables)

9 Months Ended

Sep. 30, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Derivative Instruments

The following table summarizes the interest rate derivatives we entered into over the applicable periods:

	Nine Months Ended September 30,
Interest rate caps:(1)	2021			2020
Notional amount (in thousands)	$	882,500		$	602,500
Strike rate low end of range	0.75		%	3.00		%
Strike rate high end of range	4.00		%	4.00		%
Effective date range	January 2021- September 2021			March 2020 - June 2020
Termination date range	February 2022- August 2024			April 2021 - June 2021
Total cost of interest rate caps (in thousands)	$	200		$	92

_______________

(1)    No instruments were designated as cash flow hedges.

Interest rate derivatives consisted of the following:

Interest rate caps: (1)	September 30, 2021			December 31, 2020
Notional amount (in thousands)	$	962,500		$	779,000
Strike rate low end of range	0.75		%	3.00		%
Strike rate high end of range	4.00		%	4.00		%
Termination date range	October 2021 - August 2024			February 2021 - October 2021
Aggregate principal balance on corresponding mortgage loans (in thousands)	$	857,250		$	779,000

_______________

(1)No instruments were designated as cash flow hedges.

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Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2021

Fair Value Disclosures [Abstract]

Schedule of Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following table presents our assets and liabilities measured at fair value on a recurring basis aggregated by the level within which measurements fall in the fair value hierarchy (in thousands):

	Quoted Market Prices (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
September 30, 2021
Assets
Derivative assets:
Interest rate derivatives - caps	$	—	$	74	$	—	$	74
Total	$	—	$	74	$	—	$	74	(1)
Liabilities
Derivative liabilities:
Warrants	—		(1,338)		$	—	(1,338)		(2)
Net	$	—	$	(1,264)	$	—	$	(1,264)

__________________

(1)Reported as “derivative assets” in our condensed consolidated balance sheet.

(2)Reported as “derivative liabilities” in our condensed consolidated balance sheet.

Effect of Fair Value Measured Assets and Liabilities on Consolidated Statements of Operations

The following table summarizes the effect of fair value measured assets and liabilities on our condensed consolidated statements of operations (in thousands):

	Gain (Loss) Recognized in Income
	Three Months Ended September 30,					Nine Months Ended September 30,
	2021		2020			2021		2020
Assets
Derivative assets:
Interest rate derivatives - caps	$	(48)	$	(30)		$	(126)	$	(93)
Credit default swaps	—		51		(1)	—		226		(1)
Total derivative assets	$	(48)	$	21		$	(126)	$	133
Total	$	(48)	$	21		$	(126)	$	133
Liabilities
Derivative liabilities:
Warrants	190		—			190		—
Net	$	142	$	21		$	64	$	133
Total combined
Interest rate derivatives - floors	$	—	$	3,540		$	—	$	3,615
Interest rate derivatives - caps	(48)		(30)			(126)		(93)
Credit default swaps	—		51			—		226
Warrants	190		—			190		—
Unrealized gain (loss) on derivatives	142		3,561			64		3,748
Realized gain (loss) on interest rate floors	—		(3,540)		(2)	—		(3,615)		(2)
Net	$	142	$	21		$	64	$	133

_______________

(1)Excludes costs associated with credit default swaps of $0 and $64 for the three months ended September 30, 2021 and 2020, respectively, as well as $0 and $191 for the nine months ended September 30, 2021 and 2020, respectively, which is included in “other income (expense)” in our condensed consolidated statements of operations.

(2)Included in “other income (expense)” in our condensed consolidated statements of operations

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Summary of Fair Value of Financial Instruments (Tables)

9 Months Ended

Sep. 30, 2021

Investments, All Other Investments [Abstract]

Schedule of Carrying Amounts and Estimated Fair Values of Financial Instruments

The carrying amounts and estimated fair values of financial instruments were as follows (in thousands):

	September 30, 2021				December 31, 2020
	Carrying Value		Estimated Fair Value		Carrying Value		Estimated Fair Value
Financial assets and liabilities measured at fair value:
Derivative assets	$	74	$	74	$	—	$	—
Derivative liabilities	1,338		1,338		—		—
Financial assets not measured at fair value:
Cash and cash equivalents	$	195,517	$	195,517	$	78,606	$	78,606
Restricted cash	44,753		44,753		34,544		34,544
Accounts receivable, net	17,317		17,317		13,557		13,557
Due from related parties, net	1,910		1,910		991		991
Due from third-party hotel managers	20,390		20,390		12,271		12,271
Financial liabilities not measured at fair value:
Indebtedness	$	1,172,359	$968,075 to $1,069,978		$	1,128,724	$884,325 to $977,411
Accounts payable and accrued expenses	89,265		89,265		61,758		61,758
Dividends and distributions payable	2,112		2,112		2,736		2,736
Due to Ashford Inc.	820		820		2,772		2,772
Due to third-party hotel managers	1,665		1,665		1,393		1,393

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Income (Loss) Per Share (Tables)

9 Months Ended

Sep. 30, 2021

Earnings Per Share [Abstract]

Summary of Amounts Used in Calculating Basic and Diluted Earnings (Loss) Per Share

The following table reconciles the amounts used in calculating basic and diluted income (loss) per share (in thousands, except per share amounts):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Net income (loss) attributable to common stockholders - basic and diluted:
Net income (loss) attributable to the Company	$	(6,946)	$	(18,677)	$	(24,887)	$	(79,538)
Less: Dividends on preferred stock	(1,977)		(2,554)		(6,258)		(7,664)
Less: Loss on extinguishment of preferred stock - Series B	(111)		—		(4,595)		—
Undistributed net income (loss) allocated to common stockholders	(9,034)		(21,231)		(35,740)		(87,202)
Distributed and undistributed net income (loss) - basic and diluted	$	(9,034)	$	(21,231)	$	(35,740)	$	(87,202)
Weighted average common shares outstanding:
Weighted average common shares outstanding – basic and diluted	59,207		33,923		48,954		33,103
Income (loss) per share - basic:
Net income (loss) allocated to common stockholders per share	$	(0.15)	$	(0.63)	$	(0.73)	$	(2.63)
Income (loss) per share - diluted:
Net income (loss) allocated to common stockholders per share	$	(0.15)	$	(0.63)	$	(0.73)	$	(2.63)

Summary of Computation of Diluted Income Per Share

Due to their anti-dilutive effect, the computation of diluted income (loss) per share does not reflect the adjustments for the following items (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Net income (loss) allocated to common stockholders is not adjusted for:
Income (loss) attributable to redeemable noncontrolling interests in operating partnership	$	(823)	$	(2,381)	$	(3,184)	$	(10,036)
Dividends on preferred stock - Series B	1,058		1,729		3,689		5,189
Loss on extinguishment of preferred stock - Series B	111		—		4,595		—
Interest expense on Convertible Senior Notes	1,361		—		2,010		—
Dividends on preferred stock - Series E	90		—		90		—
Dividends on preferred stock - Series M	4		—		4		—
Total	$	1,801	$	(652)	$	7,204	$	(4,847)
Weighted average diluted shares are not adjusted for:
Effect of unvested restricted shares	89		—		100		25
Effect of assumed conversion of operating partnership units	5,564		3,863		4,543		3,940
Effect of assumed conversion of preferred stock - Series B	4,115		6,728		4,781		6,728
Effect of assumed conversion of exchanged preferred stock - Series B	—		269		485		288
Effect of contingently issuable shares	—		10		—		3
Effect of assumed conversion of Convertible Senior Notes	13,609		—		6,730		—
Effect of assumed conversion of preferred stock - Series E	700		—		233		—
Effect of assumed conversion of preferred stock - Series M	32		—		11		—
Total	24,109		10,870		16,883		10,984

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Redeemable Noncontrolling Interests in Operating Partnership (Tables)

9 Months Ended

Sep. 30, 2021

Noncontrolling Interest [Abstract]

Redeemable Noncontrolling Interest

The following table presents the redeemable noncontrolling interests in Braemar OP (in thousands) and the corresponding approximate ownership percentage of our operating partnership:

	September 30, 2021			December 31, 2020
Redeemable noncontrolling interests in Braemar OP	$	39,948		$	27,655
Adjustments to redeemable noncontrolling interests (1)	$	236		$	167
Ownership percentage of operating partnership	8.35		%	9.43		%

____________________________________

(1)    Reflects the excess of the redemption value over the accumulated historical cost.

We allocated net income (loss) to the redeemable noncontrolling interests as illustrated in the table below (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Net (income) loss attributable to redeemable noncontrolling interests in operating partnership	$	823	$	2,381	$	3,184	$	10,036

The following table presents the common units redeemed and the fair value at redemption (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Common units converted to common stock	—		—		2		339
Fair value of common units converted	$	—	$	—	$	15	$	390	(1)

____________________________________

(1)    The redemption value is the greater of historical cost or fair value. The historical cost of the converted units was $3.5 million.

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Equity and Stock-Based Compensation (Tables)

9 Months Ended

Sep. 30, 2021

Equity [Abstract]

Dividends Declared

The following table summarizes dividends declared (in thousands):

	Three Months Ended September 30,			Nine Months Ended September 30,
	2021		2020	2021		2020
Series D Cumulative Preferred Stock	$	825	825	$	2,475	$	2,475

Schedule of Issuance Activity

The issuance activity is summarized below (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Common shares issued	—		3,046		2,711		3,046
Gross proceeds received	$	—	$	7,715	$	16,119	$	7,715
Commissions and other expenses	—		97		202		97
Net proceeds	$	—	$	7,618	$	15,917	$	7,618

The issuance activity under the SEDA is summarized below (in thousands):

	Three Months Ended September 30, 2021		Nine Months Ended September 30, 2021
Common shares sold to YA	—		1,700
Proceeds received	$	—	$	10,000

The issuance activity under the Lincoln Park agreement is summarized below (in thousands):

	Three Months Ended September 30, 2021		Nine Months Ended September 30, 2021
Common shares sold to Lincoln Park	—		766
Additional commitment shares	—		15
Total common shares issued to Lincoln Park	—		781
Proceeds received	$	—	$	4,217

The issuance activity under the Virtu May 2021 EDA is summarized below (in thousands):

	Three Months Ended September 30, 2021		Nine Months Ended September 30, 2021
Common shares issued	2,367		8,339
Gross proceeds received	$	13,421	$	50,000
Commissions and other expenses	134		500
Net proceeds	$	13,287	$	49,500

The issuance activity under the Virtu July 2021 EDA is summarized below (in thousands):

	Three Months Ended September 30, 2021		Nine Months Ended September 30, 2021
Common shares issued	4,183		4,183
Gross proceeds received	$	21,363	$	21,363
Commissions and other expenses	214		214
Net proceeds	$	21,149	$	21,149

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Preferred Stock (Tables)

9 Months Ended

Sep. 30, 2021

Temporary Equity Disclosure [Abstract]

Summary of the Activity of Temporary Equity

The issuance activity is summarized below (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Series B Convertible Preferred Stock shares issued	—		—		—		23
Gross proceeds received	$	—	$	—	$	—	$	439
Commissions and other expenses	—		—		—		7
Net proceeds	$	—	$	—	$	—	$	432

The following table summarizes dividends declared (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Series B Convertible Preferred Stock	$	1,058	$	1,729	$	3,689	$	5,189

The issuance activity of the Series E Preferred Stock is summarized below (in thousands):

	Three Months Ended September 30,		Nine Months Ended September 30,
	2021		2021
Series E Preferred Stock shares issued	266		266
Net proceeds	$	5,976	$	5,976

The redemption value adjustment of Series E Preferred Stock is summarized below (in thousands):

	September 30, 2021		December 31, 2020
Series E Preferred Stock	$	6,110	$	—
Adjustments to Series E Preferred Stock (1)	$	1,906	$	—

________

(1)    Reflects the excess of the redemption value over the accumulated carrying value.

The following table summarizes dividends declared (in thousands):

	Three Months Ended September 30,	Nine Months Ended September 30,
	2021	2021
Series E Preferred Stock	90	90

The issuance activity of Series M Preferred Stock is summarized below (in thousands):

	Three Months Ended September 30,		Nine Months Ended September 30,
	2021		2021
Series M Preferred Stock shares issued	15		15
Net proceeds	$	355	$	355

The redemption value adjustment of Series M Preferred stock is summarized below (in thousands):

	September 30, 2021		December 31, 2020
Series M Preferred Stock	$	361	$	—
Adjustments to Series M Preferred Stock (1)	$	111	$	—

________

(1)    Reflects the excess of the redemption value over the accumulated carrying value.

The following table summarizes dividends declared (in thousands):

	Three Months Ended September 30,		Nine Months Ended September 30,
	2021		2021
Series M Preferred Stock	$	4	$	4

Summary of Series B Cumulative Convertible Preferred Stock Activity

The table below summarizes the activity (in thousands):

	Three Months Ended September 30, 2021		Nine Months Ended September 30, 2021
	Preferred Shares Tendered	Common Shares Issued	Preferred Shares Tendered	Common Shares Issued
Series B Convertible Preferred Stock	30	120	1,953	7,291

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Related Party Transactions (Tables)

9 Months Ended

Sep. 30, 2021

Related Party Transactions [Abstract]

Schedule of Related Party Transactions

The following table summarizes the advisory services fees incurred (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
Advisory services fee
Base advisory fee	$	2,758	$	2,386	$	7,981	$	7,579
Reimbursable expenses (1)	694		404		1,696		1,360
Equity-based compensation (2)	2,994		1,785		6,666		5,606
Incentive fee	(1,637)		—		—		—
Total	$	4,809	$	4,575	$	16,343	$	14,545

________

(1)Reimbursable expenses include overhead, internal audit, risk management advisory and asset management services.

(2)    Equity-based compensation is associated with equity grants of Braemar’s common stock, PSUs, LTIP units and Performance LTIP units awarded to officers and employees of Ashford LLC.

The table below summarizes the amount Braemar has expensed related to reimbursed operating expenses of Ashford Securities (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
Line Item	2021		2020		2021		2020
Corporate, general and administrative	$	642	$	228	$	1,505	$	558

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Commitment and Contingencies (Tables)

9 Months Ended

Sep. 30, 2021

Commitments and Contingencies Disclosure [Abstract]

Schedule of Licensing Fees Incurred

The table below summarizes the licensing fees incurred (in thousands):

Line Item	Three Months Ended September 30, 2021		Nine Months Ended September 30, 2021
Other hotel expenses	$	53	$	53

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Organization and Description of Business (Details) $ in Thousands	Sep. 30, 2021 USD ($) hotel state room	Dec. 31, 2020 USD ($)	Sep. 30, 2020 USD ($) hotel	Dec. 31, 2019 USD ($)
Real Estate Properties [Line Items]
Number of hotel properties	14		13
Number of states in which entity operates | state	6
Number of rooms | room	3,865
Number of units in real estate property, net partnership interest | room	3,630
Cash and cash equivalents | $	$ 195,517	$ 78,606	$ 88,227	$ 71,995
Restricted cash | $	44,753	34,544	$ 34,658	$ 58,388
Due from third-party hotel managers | $	$ 20,390	$ 12,271
Wholly Owned Properties
Real Estate Properties [Line Items]
Number of hotel properties	12
Consolidated Properties
Real Estate Properties [Line Items]
Number of hotel properties	2
Leased by Wholly-Owned or Majority-Owned Taxable REIT Subsidiaries
Real Estate Properties [Line Items]
Number of hotel properties	13
US Virgin Islands Taxable REIT Subsidiary
Real Estate Properties [Line Items]
Number of hotel properties	1
Leased by Ashford Prime Wholly-Owned Taxable REIT Subsidiary
Real Estate Properties [Line Items]
Number of hotel properties	11
Remington Hotels
Real Estate Properties [Line Items]
Number of hotel properties managed by related party	4

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Significant Accounting Policies (Details)	Aug. 05, 2021 residences
Mr. C Beverly Hills Hotel and Luxury Residences
Significant Accounting Policies [Line Items]
Number of real estate properties acquired	5

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Revenue (Details)	3 Months Ended		9 Months Ended
	Sep. 30, 2021 USD ($) hotel	Sep. 30, 2020 USD ($) hotel	Sep. 30, 2021 USD ($) hotel	Sep. 30, 2020 USD ($) hotel
Disaggregation of Revenue [Line Items]
Number of Hotels | hotel	14	13	14	13
Total revenue	$ 116,177,000	$ 44,754,000	$ 297,135,000	$ 175,169,000
Other Hotel Revenue
Disaggregation of Revenue [Line Items]
Revenue from business interruption losses	$ 0	$ 0	$ 0	$ 4,000,000
California
Disaggregation of Revenue [Line Items]
Number of Hotels | hotel	6	5	6	5
Total revenue	$ 40,488,000	$ 15,935,000	$ 87,484,000	$ 54,811,000
Colorado
Disaggregation of Revenue [Line Items]
Number of Hotels | hotel	1	1	1	1
Total revenue	$ 10,443,000	$ 4,039,000	$ 26,460,000	$ 19,827,000
Florida
Disaggregation of Revenue [Line Items]
Number of Hotels | hotel	2	2	2	2
Total revenue	$ 23,703,000	$ 13,540,000	$ 82,007,000	$ 47,228,000
Illinois
Disaggregation of Revenue [Line Items]
Number of Hotels | hotel	1	1	1	1
Total revenue	$ 6,818,000	$ 2,073,000	$ 12,419,000	$ 6,257,000
Pennsylvania
Disaggregation of Revenue [Line Items]
Number of Hotels | hotel	1	1	1	1
Total revenue	$ 4,734,000	$ 1,155,000	$ 8,764,000	$ 7,680,000
Washington
Disaggregation of Revenue [Line Items]
Number of Hotels | hotel	1	1	1	1
Total revenue	$ 8,248,000	$ 1,177,000	$ 13,067,000	$ 6,155,000
Washington, D.C.
Disaggregation of Revenue [Line Items]
Number of Hotels | hotel	1	1	1	1
Total revenue	$ 3,325,000	$ 627,000	$ 7,310,000	$ 11,513,000
USVI
Disaggregation of Revenue [Line Items]
Number of Hotels | hotel	1	1	1	1
Total revenue	$ 18,418,000	$ 6,208,000	$ 59,624,000	$ 21,698,000
Rooms
Disaggregation of Revenue [Line Items]
Total revenue	77,560,000	28,118,000	195,720,000	105,119,000
Rooms | California
Disaggregation of Revenue [Line Items]
Total revenue	28,838,000	11,504,000	60,935,000	37,401,000
Rooms | Colorado
Disaggregation of Revenue [Line Items]
Total revenue	4,123,000	1,688,000	12,058,000	9,955,000
Rooms | Florida
Disaggregation of Revenue [Line Items]
Total revenue	13,738,000	7,103,000	47,964,000	24,401,000
Rooms | Illinois
Disaggregation of Revenue [Line Items]
Total revenue	5,233,000	1,706,000	9,607,000	4,638,000
Rooms | Pennsylvania
Disaggregation of Revenue [Line Items]
Total revenue	3,911,000	1,088,000	7,568,000	6,088,000
Rooms | Washington
Disaggregation of Revenue [Line Items]
Total revenue	6,906,000	1,056,000	10,980,000	4,821,000
Rooms | Washington, D.C.
Disaggregation of Revenue [Line Items]
Total revenue	2,476,000	331,000	5,711,000	6,857,000
Rooms | USVI
Disaggregation of Revenue [Line Items]
Total revenue	12,335,000	3,642,000	40,897,000	10,958,000
Food and Beverage
Disaggregation of Revenue [Line Items]
Total revenue	24,494,000	8,537,000	60,976,000	39,417,000
Food and Beverage | California
Disaggregation of Revenue [Line Items]
Total revenue	8,024,000	2,895,000	17,942,000	10,936,000
Food and Beverage | Colorado
Disaggregation of Revenue [Line Items]
Total revenue	4,152,000	692,000	8,344,000	4,974,000
Food and Beverage | Florida
Disaggregation of Revenue [Line Items]
Total revenue	5,384,000	3,175,000	18,732,000	12,535,000
Food and Beverage | Illinois
Disaggregation of Revenue [Line Items]
Total revenue	1,196,000	240,000	2,020,000	1,129,000
Food and Beverage | Pennsylvania
Disaggregation of Revenue [Line Items]
Total revenue	580,000	9,000	706,000	1,215,000
Food and Beverage | Washington
Disaggregation of Revenue [Line Items]
Total revenue	792,000	3,000	1,041,000	794,000
Food and Beverage | Washington, D.C.
Disaggregation of Revenue [Line Items]
Total revenue	512,000	4,000	767,000	3,482,000
Food and Beverage | USVI
Disaggregation of Revenue [Line Items]
Total revenue	3,854,000	1,519,000	11,424,000	4,352,000
Other Hotel
Disaggregation of Revenue [Line Items]
Total revenue	14,123,000	8,099,000	40,439,000	30,633,000
Other Hotel | California
Disaggregation of Revenue [Line Items]
Total revenue	3,626,000	1,536,000	8,607,000	6,474,000
Other Hotel | Colorado
Disaggregation of Revenue [Line Items]
Total revenue	2,168,000	1,659,000	6,058,000	4,898,000
Other Hotel | Florida
Disaggregation of Revenue [Line Items]
Total revenue	4,581,000	3,262,000	15,311,000	10,292,000
Other Hotel | Illinois
Disaggregation of Revenue [Line Items]
Total revenue	389,000	127,000	792,000	490,000
Other Hotel | Pennsylvania
Disaggregation of Revenue [Line Items]
Total revenue	243,000	58,000	490,000	377,000
Other Hotel | Washington
Disaggregation of Revenue [Line Items]
Total revenue	550,000	118,000	1,046,000	540,000
Other Hotel | Washington, D.C.
Disaggregation of Revenue [Line Items]
Total revenue	337,000	292,000	832,000	1,174,000
Other Hotel | USVI
Disaggregation of Revenue [Line Items]
Total revenue	$ 2,229,000	$ 1,047,000	$ 7,303,000	$ 6,388,000

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Investments in Hotel Properties, net (Details) - USD ($)	1 Months Ended	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020	Dec. 31, 2020
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net [Abstract]
Land		$ 480,530,000		$ 480,530,000		$ 455,298,000
Buildings and improvements		1,222,422,000		1,222,422,000		1,190,437,000
Furniture, fixtures and equipment		122,921,000		122,921,000		127,692,000
Construction in progress		9,136,000		9,136,000		11,422,000
Residences		12,746,000		12,746,000		0
Total cost		1,847,755,000		1,847,755,000		1,784,849,000
Accumulated depreciation		(395,753,000)		(395,753,000)		(360,259,000)
Investments in hotel properties, net		1,452,002,000		1,452,002,000		$ 1,424,590,000
Gain associated with proceeds received from insurance	$ 10,100,000	0		481,000
Proceeds from insurance carriers		0	$ 650,000	0	$ 8,000,000
Impairment charges		$ 0	$ 0	$ 0	$ 0

XML

Investments in Hotel Properties, net - Mr. C Beverly Hills Hotel (Details) $ / shares in Units, shares in Thousands, $ in Thousands	Aug. 05, 2021 USD ($) residences room $ / shares shares	Sep. 30, 2021 room
Real Estate Properties [Line Items]
Number of rooms | room		3,865
Mr. C Beverly Hills Hotel and Luxury Residences
Real Estate Properties [Line Items]
Ownership interest acquired	100.00%
Number of rooms | room	138
Number of real estate properties acquired | residences	5
Consideration transferred, cash	$ 10,000
Strike price of warrants (in dollars per share) | $ / shares	$ 6.00
Fair value of warrants	$ 1,500
Fair value of assumed mortgage loan	49,815
Mortgages | Mr. C Beverly Hills Hotel and Luxury Residences
Real Estate Properties [Line Items]
Consideration transferred, debt assumed	50,000
Fair value of assumed mortgage loan	49,800
Repayment of assumed debt	$ 20,000
Operating Partnership Units | Mr. C Beverly Hills Hotel and Luxury Residences
Real Estate Properties [Line Items]
Consideration transferred, equity issued (in shares) | shares	2,500
Consideration transferred, fair value of equity issued	$ 13,200
Warrants | Mr. C Beverly Hills Hotel and Luxury Residences
Real Estate Properties [Line Items]
Consideration transferred, equity issued (in shares) | shares	500

XML

Investments in Hotel Properties, net - Schedule of Preliminary Estimated Fair Value of the Assets Acquired and Liabilities Assumed in the Acquisition (Details) - Mr. C Beverly Hills Hotel and Luxury Residences $ in Thousands	Aug. 05, 2021 USD ($)
Business Acquisition [Line Items]
Land	$ 25,232
Buildings and improvements	35,689
Furniture, fixtures and equipment	758
Residences	12,746
Investments in hotel properties	74,425
Inventories	94
Mortgage loan	(49,815)
Net assets (liabilities)	24,704
Net other assets (liabilities)	$ (486)

XML

Investments in Hotel Properties, net - Schedule of Pro Forma Information Since Acquisition Date (Details) - Mr. C Beverly Hills Hotel and Luxury Residences - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2021	Sep. 30, 2021
Business Acquisition [Line Items]
Total revenue	$ 2,272	$ 2,272
Net income (loss)	$ (1,203)	$ (1,203)

XML

Investments in Hotel Properties, net - Schedule of Pro Forma Financial Results (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Business Acquisition [Line Items]
Net income (loss)	$ (8,219)	$ (23,057)	$ (30,617)	$ (94,549)
Mr. C Beverly Hills Hotel and Luxury Residences
Business Acquisition [Line Items]
Total revenue	117,808	46,409	303,406	181,121
Net income (loss)	(7,114)	(23,939)	(30,418)	(97,449)
Net income (loss) attributable to common stockholders	$ (7,898)	$ (20,675)	$ (34,082)	$ (84,203)
Pro Forma income per share;
Basic (in dollars per share)	$ (0.13)	$ (0.61)	$ (0.70)	$ (2.54)
Diluted (in dollars per share)	$ (0.13)	$ (0.61)	$ (0.70)	$ (2.54)
Weighted average common shares outstanding (in thousands):
Basic (in shares)	59,207	33,923	48,954	33,103
Diluted (in shares)	59,207	33,923	48,954	33,103
Transaction costs | Mr. C Beverly Hills Hotel and Luxury Residences
Business Acquisition [Line Items]
Net income (loss)	$ 275		$ 571

XML

Investment in Unconsolidated Entity (Details) - USD ($)		3 Months Ended		9 Months Ended
	Jul. 12, 2021	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020	Dec. 31, 2020	Dec. 31, 2018
Schedule of Equity Method Investments [Line Items]
Investment in unconsolidated entity				$ 117,000	$ 26,000
Carrying value of the investment in OpenKey		$ 1,627,000		1,627,000		$ 1,708,000
Equity in earnings (loss) of unconsolidated entity		$ (68,000)	$ (58,000)	$ (198,000)	(138,000)
OpenKey
Schedule of Equity Method Investments [Line Items]
Ownership interest in OpenKey (as a percent)		7.80%		7.80%		8.20%	8.20%
Investment in unconsolidated entity	$ 117,000
Aggregate equity method investments		$ 2,500,000		$ 2,500,000
Impairment		0	$ 0	0	$ 0
Carrying value of the investment in OpenKey		$ 1,627,000		$ 1,627,000		$ 1,708,000

XML

Indebtedness, net (Schedule of Indebtedness) (Details) $ in Thousands			9 Months Ended
	Feb. 22, 2021	Jun. 08, 2020	Sep. 30, 2021 USD ($) extension	May 31, 2021 USD ($)	May 18, 2021 USD ($)	Dec. 31, 2020 USD ($)
Debt Instrument [Line Items]
Indebtedness, gross			$ 1,181,203			$ 1,128,724
Capitalized default interest and late charges			4,425			7,304
Deferred loan costs, net			(3,997)			(5,434)
Discounts, net			(8,844)			0
Indebtedness, net			$ 1,172,787			$ 1,130,594
LIBOR rate			0.08%			0.144%
Mortgages | LIBOR
Debt Instrument [Line Items]
Basis spread on variable rate			1.00%
Mortgages | Base Rate
Debt Instrument [Line Items]
Basis spread on variable rate			0.50%
Mortgages | Mortgage Loan 2
Debt Instrument [Line Items]
Indebtedness, gross			$ 67,500			$ 67,500
Number of extension options | extension			3
Term of extension options (in years)			1 year
Mortgages | Mortgage Loan 2 | LIBOR
Debt Instrument [Line Items]
Basis spread on variable rate			3.00%
Mortgages | Mortgage Loan 4
Debt Instrument [Line Items]
Indebtedness, gross			$ 435,000			435,000
Number of extension options | extension			5
Term of extension options (in years)			1 year
Mortgages | Mortgage Loan 4 | LIBOR
Debt Instrument [Line Items]
Basis spread on variable rate			2.16%
Mortgages | Mortgage Loan 1
Debt Instrument [Line Items]
Indebtedness, gross			$ 42,500			42,500
Number of extension options | extension			3
Term of extension options (in years)			1 year
Mortgages | Mortgage Loan 1 | LIBOR
Debt Instrument [Line Items]
Basis spread on variable rate			3.95%
LIBOR floor (as a percent)			1.00%
Mortgages | Mortgage Loan 6
Debt Instrument [Line Items]
Indebtedness, gross			$ 99,750			100,000
Mortgages | Mortgage Loan 6 | LIBOR
Debt Instrument [Line Items]
Basis spread on variable rate			2.65%
LIBOR floor (as a percent)			0.25%
Mortgages | Mortgage Loan 3
Debt Instrument [Line Items]
Indebtedness, gross			$ 51,000			51,000
Mortgages | Mortgage Loan 3 | LIBOR
Debt Instrument [Line Items]
Basis spread on variable rate			2.55%
LIBOR floor (as a percent)			0.25%
Mortgages | Mortgage Loan 5
Debt Instrument [Line Items]
Indebtedness, gross			$ 40,000			40,000
Mortgages | Mortgage Loan 5 | LIBOR
Debt Instrument [Line Items]
Basis spread on variable rate			2.55%
LIBOR floor (as a percent)			0.25%
Mortgages | Mortgage Loan 7
Debt Instrument [Line Items]
Indebtedness, gross			$ 54,000			54,000
Mortgages | Mortgage Loan 7 | LIBOR
Debt Instrument [Line Items]
Basis spread on variable rate			2.10%
LIBOR floor (as a percent)			0.25%
Mortgages | Mortgage Loan 8
Debt Instrument [Line Items]
Indebtedness, gross			$ 195,203			197,229
Mortgages | Mortgage Loan 8 | LIBOR
Debt Instrument [Line Items]
Basis spread on variable rate			1.70%
Mortgages | Mortgage Loan 10
Debt Instrument [Line Items]
Indebtedness, gross			$ 30,000			0
Mortgages | Mortgage Loan 10 | LIBOR
Debt Instrument [Line Items]
Basis spread on variable rate			3.60%
LIBOR floor (as a percent)			1.50%
Mortgages | Mortgage Loan 9
Debt Instrument [Line Items]
Indebtedness, gross			$ 80,000			80,000
Mortgages | Mortgage Loan 9 | LIBOR
Debt Instrument [Line Items]
Basis spread on variable rate			1.85%
LIBOR floor (as a percent)			0.25%
Term Loan | Term loan
Debt Instrument [Line Items]
Indebtedness, gross			$ 0			61,495
Term Loan | Term loan | LIBOR
Debt Instrument [Line Items]
LIBOR floor (as a percent)		0.50%
Term Loan | Term loan | LIBOR | Minimum
Debt Instrument [Line Items]
Basis spread on variable rate		2.25%
Term Loan | Term loan | LIBOR | Maximum
Debt Instrument [Line Items]
Basis spread on variable rate	3.65%	3.50%
Term Loan | Term loan | Base Rate | Minimum
Debt Instrument [Line Items]
Basis spread on variable rate		1.25%
Term Loan | Term loan | Base Rate | Maximum
Debt Instrument [Line Items]
Basis spread on variable rate	2.65%	2.50%
Convertible Senior Notes | Convertible senior notes
Debt Instrument [Line Items]
Indebtedness, gross			$ 86,250			$ 0
Interest rate			4.50%	4.50%
Face amount of debt				$ 86,250	$ 86,250

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Indebtedness, net (Narrative) (Details)		1 Months Ended	3 Months Ended				9 Months Ended
	Aug. 05, 2021 USD ($)	May 31, 2021 USD ($) day $ / shares	Sep. 30, 2021 USD ($)	Jun. 30, 2021 USD ($)	Mar. 31, 2021 USD ($)	Sep. 30, 2020 USD ($)	Sep. 30, 2021 USD ($)	Sep. 30, 2020 USD ($)	May 18, 2021 USD ($)
Debt Instrument [Line Items]
Gain (loss) recognized on loans					$ 0
Amortization of principal amortization			$ 519,000			$ 937,000	$ 2,900,000	$ 1,200,000
Net proceeds from long-term debt							$ 83,231,000	$ 109,317,000
Mortgages | Mr. C Beverly Hills Hotel and Luxury Residences
Debt Instrument [Line Items]
Consideration transferred, debt assumed	$ 50,000,000
Repayment of assumed debt	20,000,000
Mortgages | LIBOR
Debt Instrument [Line Items]
Basis spread on variable rate							1.00%
Convertible senior notes | Convertible Senior Notes
Debt Instrument [Line Items]
Face amount of debt		$ 86,250,000							$ 86,250,000
Interest rate		4.50%	4.50%				4.50%
Net proceeds from long-term debt		$ 82,800,000
Coupon interest expense			$ 970,000				$ 1,400,000
Carrying amount of the equity component		6,300,000
Initial discount		$ 9,300,000
Discount amortization				$ 391,000			$ 576,000
Conversion rate		0.1577909
Conversion price (in dollars per share) | $ / shares		$ 6.34
Threshold percentage of stock price trigger		130.00%
Threshold trading days | day		20
Threshold consecutive trading days | day		30
Redemption price, percentage		100.00%
Convertible senior notes | Convertible Senior Notes | Discount rate
Debt Instrument [Line Items]
Debt instrument, measurement input		0.071
Mortgage Loan 10 | Mortgages | Mr. C Beverly Hills Hotel and Luxury Residences
Debt Instrument [Line Items]
Consideration transferred, debt assumed	50,000,000
Repayment of assumed debt	$ 20,000,000
Mortgage Loan 10 | Mortgages | LIBOR
Debt Instrument [Line Items]
Basis spread on variable rate							3.60%
Mortgage Loan 10 | Mortgages | LIBOR | Mr. C Beverly Hills Hotel and Luxury Residences
Debt Instrument [Line Items]
Basis spread on variable rate	3.60%

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Derivative Instruments (Details) - Not Designated as Hedging Instrument - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Dec. 31, 2020
Interest rate derivatives - caps
Derivative [Line Items]
Notional amount (in thousands)	$ 962,500		$ 779,000
Aggregate principal balance on corresponding mortgage loans (in thousands)	$ 857,250		$ 779,000
Interest rate derivatives - caps | Minimum
Derivative [Line Items]
Strike rate	0.75%		3.00%
Interest rate derivatives - caps | Maximum
Derivative [Line Items]
Strike rate	4.00%		4.00%
Interest rate derivatives - caps
Derivative [Line Items]
Notional amount (in thousands)	$ 882,500	$ 602,500
Total cost of interest rate caps (in thousands)	$ 200	$ 92
Interest rate derivatives - caps | Minimum
Derivative [Line Items]
Strike rate	0.75%	3.00%
Interest rate derivatives - caps | Maximum
Derivative [Line Items]
Strike rate	4.00%	4.00%

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Derivative Instruments - Warrants (Details) - Mr. C Beverly Hills Hotel and Luxury Residences $ / shares in Units, $ in Millions	Aug. 05, 2021 USD ($) residences $ / shares shares	Sep. 30, 2021 shares
Business Acquisition [Line Items]
Number of real estate properties acquired | residences	5
Strike price of warrants (in dollars per share) | $ / shares	$ 6.00
Warrants exercised (in shares)		0
Fair value of warrants | $	$ 1.5
Contractual Term | Valuation Technique, Option Pricing Model | Warrants | Fair Value, Inputs, Level 2
Business Acquisition [Line Items]
Warrants, measurement input	3
Volatility | Valuation Technique, Option Pricing Model | Warrants | Fair Value, Inputs, Level 2
Business Acquisition [Line Items]
Warrants, measurement input	0.9793
Dividend Rate | Valuation Technique, Option Pricing Model | Warrants | Fair Value, Inputs, Level 2
Business Acquisition [Line Items]
Warrants, measurement input	0
Risk-Free Interest Rate | Valuation Technique, Option Pricing Model | Warrants | Fair Value, Inputs, Level 2
Business Acquisition [Line Items]
Warrants, measurement input	0.0038
Warrants
Business Acquisition [Line Items]
Consideration transferred, equity issued (in shares)	500,000

XML

Fair Value Measurements (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020	Oct. 01, 2021	Dec. 31, 2020
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Significance of current credit spreads to level 3 input considerations (as a percent)	10.00%		10.00%
LIBOR interest rate forward curve (as a percent)	0.08%		0.08%			0.144%
Derivative liabilities:
Unrealized gain (loss) on derivatives	$ 142	$ 3,561	$ 64	$ 3,748
Subsequent Event
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
LIBOR interest rate forward curve (as a percent)					1.188%
Credit default swaps | Derivative assets
Derivative liabilities:
Derivative cost	0	64	0	191
Fair Value, Recurring
Derivative liabilities:
Net	142	21	64	133
Fair Value, Recurring | Derivative assets
Derivative assets:
Gain (Loss) Recognized in Income	(48)	21	(126)	133
Fair Value, Recurring | Non-derivative assets
Derivative assets:
Gain (Loss) Recognized in Income	(48)	21	(126)	133
Fair Value, Recurring | Derivative
Derivative liabilities:
Unrealized gain (loss) on derivatives	142	3,561	64	3,748
Fair Value, Recurring | Interest rate derivatives - floors
Derivative liabilities:
Unrealized gain (loss) on derivatives	0	3,540	0	3,615
Realized gain (loss) on interest rate floors	0	(3,540)	0	(3,615)
Fair Value, Recurring | Interest rate derivatives - caps
Derivative liabilities:
Unrealized gain (loss) on derivatives	(48)	(30)	(126)	(93)
Fair Value, Recurring | Interest rate derivatives - caps | Derivative assets
Derivative assets:
Gain (Loss) Recognized in Income	(48)	(30)	(126)	(93)
Fair Value, Recurring | Credit default swaps
Derivative liabilities:
Unrealized gain (loss) on derivatives	0	51	0	226
Fair Value, Recurring | Credit default swaps | Derivative assets
Derivative assets:
Gain (Loss) Recognized in Income	0	51	0	226
Fair Value, Recurring | Warrants
Derivative liabilities:
Unrealized gain (loss) on derivatives	190	0	190	0
Fair Value, Recurring | Warrants | Derivative liabilities
Derivative liabilities:
Gain (Loss) Recognized in Income	$ 190	$ 0	$ 190	$ 0

XML

Fair Value Measurements - Schedule of Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands	Sep. 30, 2021	Dec. 31, 2020
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	$ 74
Derivative liabilities	1,338	$ 0
Fair Value, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	74
Net	(1,264)
Quoted Market Prices (Level 1) | Fair Value, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	0
Net	0
Significant Other Observable Inputs (Level 2) | Fair Value, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	74
Net	(1,264)
Significant Unobservable Inputs (Level 3) | Fair Value, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	0
Net	0
Interest rate derivatives - caps | Fair Value, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	74
Interest rate derivatives - caps | Quoted Market Prices (Level 1) | Fair Value, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	0
Interest rate derivatives - caps | Significant Other Observable Inputs (Level 2) | Fair Value, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	74
Interest rate derivatives - caps | Significant Unobservable Inputs (Level 3) | Fair Value, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	0
Warrants | Fair Value, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liabilities	(1,338)
Warrants | Quoted Market Prices (Level 1) | Fair Value, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liabilities	0
Warrants | Significant Other Observable Inputs (Level 2) | Fair Value, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liabilities	(1,338)
Warrants | Significant Unobservable Inputs (Level 3) | Fair Value, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liabilities	$ 0

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Summary of Fair Value of Financial Instruments (Carrying Amounts and Estimated Fair Values of Financial Instruments) (Details) - USD ($) $ in Thousands	Sep. 30, 2021	Dec. 31, 2020	Sep. 30, 2020	Dec. 31, 2019
Financial assets and liabilities measured at fair value:
Derivative assets, Carrying value	$ 74
Derivative liabilities, Carrying value	1,338	$ 0
Financial assets not measured at fair value:
Cash and cash equivalents, Carrying value	195,517	78,606	$ 88,227	$ 71,995
Restricted cash, Carrying value	44,753	34,544	$ 34,658	$ 58,388
Accounts receivable, net, Carrying value	17,317	13,557
Due from related parties, net, Carrying value	1,910	991
Due from third-party hotel managers, Carrying value	20,390	12,271
Financial liabilities not measured at fair value:
Indebtedness, Carrying value	1,181,203	1,128,724
Accounts payable and accrued expenses, Carrying value	89,265	61,758
Dividends and distributions payable, Carrying value	2,112	2,736
Due to Ashford Inc., Carrying Value	820	2,772
Due to third-party hotel managers, Carrying value	1,665	1,393
Carrying Value
Financial assets and liabilities measured at fair value:
Derivative assets, Carrying value	74	0
Derivative liabilities, Carrying value	1,338	0
Financial assets not measured at fair value:
Cash and cash equivalents, Carrying value	195,517	78,606
Restricted cash, Carrying value	44,753	34,544
Accounts receivable, net, Carrying value	17,317	13,557
Due from related parties, net, Carrying value	1,910	991
Due from third-party hotel managers, Carrying value	20,390	12,271
Financial liabilities not measured at fair value:
Indebtedness, Carrying value	1,172,359	1,128,724
Accounts payable and accrued expenses, Carrying value	89,265	61,758
Dividends and distributions payable, Carrying value	2,112	2,736
Due to Ashford Inc., Carrying Value	820	2,772
Due to third-party hotel managers, Carrying value	1,665	1,393
Estimated Fair Value
Financial assets and liabilities measured at fair value:
Derivative assets, Estimated fair value	74	0
Derivative liabilities, Estimated fair value	1,338	0
Financial assets not measured at fair value:
Cash and cash equivalents, Estimated fair value	195,517	78,606
Restricted cash, Estimated fair value	44,753	34,544
Accounts receivable, net, Estimated fair value	17,317	13,557
Due from related parties, net, Estimated fair value	1,910	991
Due from third-party hotel managers, Estimated fair value	20,390	12,271
Financial liabilities not measured at fair value:
Accounts payable and accrued expenses, Estimated fair value	89,265	61,758
Dividends and distributions payable, Estimated fair value	2,112	2,736
Due to Ashford Inc., Fair Value Disclosure	820	2,772
Due to third-party hotel managers, Estimated fair value	1,665	1,393
Minimum | Estimated Fair Value
Financial liabilities not measured at fair value:
Indebtedness, Estimated fair value	968,075	884,325
Maximum | Estimated Fair Value
Financial liabilities not measured at fair value:
Indebtedness, Estimated fair value	$ 1,069,978	$ 977,411

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Summary of Fair Value of Financial Instruments (Narrative) (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2021	Dec. 31, 2020
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Maximum maturity term of financial assets (in days)	90 days
Indebtedness, Carrying value	$ 1,181,203	$ 1,128,724
Carrying Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Indebtedness, Carrying value	$ 1,172,359	$ 1,128,724
Minimum
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Total indebtedness fair value variance from carrying value (as a percent)	82.60%	78.30%
Maximum
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Total indebtedness fair value variance from carrying value (as a percent)	91.30%	86.60%

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Income (Loss) Per Share (Reconciliation) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Net income (loss) attributable to common stockholders - basic and diluted:
Net income (loss) attributable to the Company	$ (6,946)	$ (18,677)	$ (24,887)	$ (79,538)
Less: Dividends on preferred stock	(1,977)	(2,554)	(6,258)	(7,664)
Less: Loss on extinguishment of preferred stock - Series B	(111)	0	(4,595)	0
Undistributed net income (loss) allocated to common stockholders	(9,034)	(21,231)	(35,740)	(87,202)
Distributed and undistributed net income (loss) - basic	(9,034)	(21,231)	(35,740)	(87,202)
Distributed and undistributed net income (loss) - diluted	$ (9,034)	$ (21,231)	$ (35,740)	$ (87,202)
Weighted average common shares outstanding:
Weighted average common shares outstanding – basic (in shares)	59,207	33,923	48,954	33,103
Weighted average common shares outstanding – diluted (in shares)	59,207	33,923	48,954	33,103
Income (loss) per share - basic:
Net income (loss) allocated to common stockholders per share (in dollars per share)	$ (0.15)	$ (0.63)	$ (0.73)	$ (2.63)
Income (loss) per share - diluted:
Net income (loss) allocated to common stockholders per share (in dollars per share)	$ (0.15)	$ (0.63)	$ (0.73)	$ (2.63)

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Income (Loss) Per Share (Antidilutive) (Details) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Net income (loss) allocated to common stockholders is not adjusted for:
Loss on extinguishment of preferred stock - Series B	$ 111	$ 0	$ 4,595	$ 0
Total	$ 1,801	$ (652)	$ 7,204	$ (4,847)
Weighted average diluted shares are not adjusted for:
Antidilutive securities excluded (in shares)	24,109	10,870	16,883	10,984
Series E Preferred Stock
Net income (loss) allocated to common stockholders is not adjusted for:
Dividends on preferred stock	$ 90		$ 90
Series M Preferred Stock
Net income (loss) allocated to common stockholders is not adjusted for:
Dividends on preferred stock	$ 4		$ 4
Restricted Stock
Weighted average diluted shares are not adjusted for:
Antidilutive securities excluded (in shares)	89	0	100	25
Operating Partnership Units
Net income (loss) allocated to common stockholders is not adjusted for:
Income (loss) attributable to redeemable noncontrolling interests in operating partnership	$ (823)	$ (2,381)	$ (3,184)	$ (10,036)
Weighted average diluted shares are not adjusted for:
Antidilutive securities excluded (in shares)	5,564	3,863	4,543	3,940
Equity Unit Purchase Agreements | Series B Preferred Stock
Net income (loss) allocated to common stockholders is not adjusted for:
Dividends on preferred stock	$ 1,058	$ 1,729	$ 3,689	$ 5,189
Weighted average diluted shares are not adjusted for:
Antidilutive securities excluded (in shares)	4,115	6,728	4,781	6,728
Equity Unit Purchase Agreements | Series E Preferred Stock
Net income (loss) allocated to common stockholders is not adjusted for:
Dividends on preferred stock	$ 90	$ 0	$ 90	$ 0
Weighted average diluted shares are not adjusted for:
Antidilutive securities excluded (in shares)	700	0	233	0
Equity Unit Purchase Agreements | Series M Preferred Stock
Net income (loss) allocated to common stockholders is not adjusted for:
Dividends on preferred stock	$ 4	$ 0	$ 4	$ 0
Weighted average diluted shares are not adjusted for:
Antidilutive securities excluded (in shares)	32	0	11	0
Series B Preferred Stock
Net income (loss) allocated to common stockholders is not adjusted for:
Loss on extinguishment of preferred stock - Series B	$ 111	$ 0	$ 4,595	$ 0
Exchanged Shares of Series B Preferred Stock
Weighted average diluted shares are not adjusted for:
Antidilutive securities excluded (in shares)	0	269	485	288
Contingently Issuable Shares
Weighted average diluted shares are not adjusted for:
Antidilutive securities excluded (in shares)	0	10	0	3
Convertible Senior Notes
Net income (loss) allocated to common stockholders is not adjusted for:
Interest expense on Convertible Senior Notes	$ 1,361	$ 0	$ 2,010	$ 0
Weighted average diluted shares are not adjusted for:
Antidilutive securities excluded (in shares)	13,609	0	6,730	0

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Redeemable Noncontrolling Interest in Operating Partnership (Narrative) (Details) - USD ($) shares in Thousands, $ in Thousands			1 Months Ended	9 Months Ended
	Aug. 05, 2021	May 11, 2021	Mar. 31, 2021	Sep. 30, 2021
Operating Partnership Units | Mr. C Beverly Hills Hotel and Luxury Residences
Noncontrolling Interest [Line Items]
Consideration transferred, equity issued (in shares)	2,500
Long Term Incentive Plan Units
Noncontrolling Interest [Line Items]
Vesting period (in years)		3 years	3 years	3 years
Units granted or issued (in shares)		202	244
Fair value of units granted		$ 1,400	$ 1,700
Other than options (in shares)				2,400
Units which have not reached full economic parity with the common units (in shares)				572
Long Term Incentive Plan Units | Director
Noncontrolling Interest [Line Items]
Units granted or issued (in shares)		23
Fair value of units granted		$ 164
Performance Long Term Incentive Plan Units
Noncontrolling Interest [Line Items]
Vesting period (in years)		3 years		3 years
Units granted or issued (in shares)		840
Fair value of units granted		$ 5,700
Units which have not reached full economic parity with the common units (in shares)				900
Performance Shares
Noncontrolling Interest [Line Items]
Vesting period (in years)		3 years
Units granted or issued (in shares)		446
Fair value of units granted		$ 6,000
Performance Shares | 2021 Grants
Noncontrolling Interest [Line Items]
Vesting period (in years)				3 years
Minimum | Performance Long Term Incentive Plan Units | 2019 and 2020 Grants
Noncontrolling Interest [Line Items]
Award performance target (as a percent)				0.00%
Minimum | Performance Shares | 2019 and 2020 Grants
Noncontrolling Interest [Line Items]
Award performance target (as a percent)				0.00%
Minimum | Performance Shares | 2021 Grants
Noncontrolling Interest [Line Items]
Award performance target (as a percent)				0.00%
Maximum | Performance Long Term Incentive Plan Units | 2019 and 2020 Grants
Noncontrolling Interest [Line Items]
Award performance target (as a percent)				200.00%
Maximum | Performance Shares | 2019 and 2020 Grants
Noncontrolling Interest [Line Items]
Award performance target (as a percent)				200.00%
Maximum | Performance Shares | 2021 Grants
Noncontrolling Interest [Line Items]
Award performance target (as a percent)				200.00%

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Redeemable Noncontrolling Interests in Operating Partnership (Redeemable Noncontrolling Interests) (Details) - USD ($) $ in Thousands	3 Months Ended			9 Months Ended
	Sep. 30, 2021	Mar. 31, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020	Dec. 31, 2020
Noncontrolling Interest [Line Items]
Redeemable noncontrolling interests in Braemar OP	$ 39,948			$ 39,948		$ 27,655
Adjustments to redeemable noncontrolling interests	2,856		$ (8)	(69)	$ 18
Braemar Hotels & Resorts, Inc.
Noncontrolling Interest [Line Items]
Redeemable noncontrolling interests in Braemar OP	$ 39,948			39,948		$ 27,655
Adjustments to redeemable noncontrolling interests		$ 167		$ 236
Ownership percentage of operating partnership	8.35%			8.35%		9.43%

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..Redeemable Noncontrolling Interests in Operating Partnership (Allocated Redeemable Noncontrolling Interests) (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Noncontrolling Interest [Abstract]
Net (income) loss attributable to redeemable noncontrolling interests in operating partnership	$ 823	$ 2,381	$ 3,184	$ 10,036

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Redeemable Noncontrolling Interests in Operating Partnership (Units Redeemed) (Details) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Temporary Equity [Line Items]
Fair value of common units converted			$ (17)	$ (3,454)
Historical cost				$ 3,500
Operating Partnership Units
Temporary Equity [Line Items]
Common units converted to common stock (in shares)	0	0	2	339
Fair value of common units converted	$ 0	$ 0	$ 15	$ 390

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Equity and Stock-Based Compensation (Narrative) (Details)							1 Months Ended	3 Months Ended			9 Months Ended
	Sep. 30, 2021 USD ($) $ / shares shares	Jul. 12, 2021 USD ($)	May 25, 2021 USD ($)	May 11, 2021 USD ($) shares	Apr. 21, 2021 shares	Feb. 04, 2021 USD ($) day shares	Mar. 31, 2021 USD ($) shares	Sep. 30, 2021 USD ($) $ / shares shares	Mar. 31, 2021	Sep. 30, 2020 USD ($) shares	Sep. 30, 2021 USD ($) $ / shares shares	Sep. 30, 2020 USD ($) shares	Dec. 31, 2020 $ / shares	Dec. 11, 2017 USD ($)	Dec. 05, 2017 USD ($) $ / shares
Class of Stock [Line Items]
Dividends declared								$ 0		$ 0	$ 0	$ 0
Fair value of common stock issued								$ 34,232,000		$ 6,410,000	$ 99,809,000	$ 6,410,000
Common stock, par value (in dollars per share) | $ / shares	$ 0.01							$ 0.01			$ 0.01		$ 0.01
Restricted Stock Units (RSUs)
Class of Stock [Line Items]
Units granted (in shares) | shares				215,000			504,000
Fair value of units granted				$ 1,500,000			$ 3,500,000
Vesting period (in years)				3 years			3 years
Performance Shares
Class of Stock [Line Items]
Units granted (in shares) | shares				446,000
Fair value of units granted				$ 6,000,000
Vesting period (in years)				3 years
Award service period (in years)											3 years
Performance Shares | 2021 Grants
Class of Stock [Line Items]
Vesting period (in years)											3 years
Performance Shares | Minimum | 2019 and 2020 Grants
Class of Stock [Line Items]
Award performance target (as a percent)											0.00%
Performance Shares | Minimum | 2021 Grants
Class of Stock [Line Items]
Award performance target (as a percent)											0.00%
Performance Shares | Maximum | 2019 and 2020 Grants
Class of Stock [Line Items]
Award performance target (as a percent)											200.00%
Performance Shares | Maximum | 2021 Grants
Class of Stock [Line Items]
Award performance target (as a percent)											200.00%
Private Placement | YA
Class of Stock [Line Items]
Shares sold (in shares) | shares								0			1,700,000
Proceeds received								$ 0			$ 10,000,000
Shares authorized (in shares) | shares						7,780,786
Anniversary of agreement (in months)						36 months
Percentage of the Market Price						95.00%
Ownership threshold (as a percent)						4.99%
Consecutive trading days after advance notice | day						5
Maximum advance shares (in shares) | shares						1,200,000
Price per share percentage of average daily VWAP						100.00%
Consecutive trading days prior to advance notice | day						5
Structuring fee						$ 10,000
Private Placement | Lincoln Park
Class of Stock [Line Items]
Shares sold (in shares) | shares					15,000			0			781,000
Proceeds received								$ 0			$ 4,217,000
Shares authorized (in shares) | shares					8,893,565
May 2021 Equity Distribution Agreement
Class of Stock [Line Items]
Shares sold (in shares) | shares								2,367,000			8,339,000
Proceeds received								$ 13,287,000			$ 49,500,000
May 2021 Equity Distribution Agreement | Virtu
Class of Stock [Line Items]
Maximum offering price			$ 50,000,000
Percentage of the gross sales price			0.01%
July 2021 Equity Distribution Agreements
Class of Stock [Line Items]
Shares sold (in shares) | shares								4,183,000			4,183,000
Proceeds received								$ 21,149,000			$ 21,149,000
July 2021 Equity Distribution Agreements | Virtu
Class of Stock [Line Items]
Maximum offering price		$ 100,000,000
Percentage of the gross sales price		1.00%
Common Stock
Class of Stock [Line Items]
Common shares issued (in shares) | shares								6,550,000		3,046,000	17,714,000	3,046,000
Fair value of common stock issued								$ 66,000		$ 30,000	$ 178,000	$ 30,000
Shares of stock repurchased during period (in shares) | shares										1,000	50,000	36,000
Common Stock | Director
Class of Stock [Line Items]
Common shares issued (in shares) | shares				46,000
Fair value of common stock issued				$ 322,000
Common Stock | At-The-Market Equity Distribution
Class of Stock [Line Items]
Maximum offering price														$ 50,000,000
Shares sold (in shares) | shares	7,400,000
Proceeds received	$ 30,500,000
Stock Repurchase Program
Class of Stock [Line Items]
Common stock, par value (in dollars per share) | $ / shares															$ 0.01
Share repurchase program authorized amount	$ 50,000,000							$ 50,000,000			$ 50,000,000				$ 50,000,000
Shares of stock repurchased during period (in shares) | shares											0	0
Series D Preferred Stock
Class of Stock [Line Items]
Preferred stock dividend rate								8.25%	8.25%	8.25%	8.25%	8.25%
Annual preferred stock dividend (in dollars per share) | $ / shares											$ 2.0625

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Equity and Stock-Based Compensation (Preferred Stock Dividends) (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Series D Preferred Stock
Class of Stock [Line Items]
Series D Cumulative Preferred Stock	$ 825,000	$ 825,000	$ 2,475,000	$ 2,475,000

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Equity and Stock-Based Compensation (Issuance Activity) (Details) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
	Apr. 21, 2021	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Private Placement, Shares Sold | Lincoln Park
Class of Stock [Line Items]
Common shares issued/sold (in shares)		0		766,000
Private Placement, Additional Commitment Shares | Lincoln Park
Class of Stock [Line Items]
Common shares issued/sold (in shares)		0		15,000
Private Placement | Lincoln Park
Class of Stock [Line Items]
Common shares issued/sold (in shares)	15,000	0		781,000
Net proceeds		$ 0		$ 4,217
May 2021 Equity Distribution Agreement
Class of Stock [Line Items]
Common shares issued/sold (in shares)		2,367,000		8,339,000
Gross proceeds received		$ 13,421		$ 50,000
Commissions and other expenses		134		500
Net proceeds		$ 13,287		$ 49,500
July 2021 Equity Distribution Agreements
Class of Stock [Line Items]
Common shares issued/sold (in shares)		4,183,000		4,183,000
Gross proceeds received		$ 21,363		$ 21,363
Commissions and other expenses		214		214
Net proceeds		$ 21,149		$ 21,149
Common Stock
Class of Stock [Line Items]
Common shares issued/sold (in shares)		0	3,046,000	2,711,000	3,046,000
Gross proceeds received		$ 0	$ 7,715	$ 16,119	$ 7,715
Commissions and other expenses		0	97	202	97
Net proceeds		$ 0	$ 7,618	$ 15,917	$ 7,618

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Equity and Stock-Based Compensation (Issuance Activity Under the SEDA) (Details) - Private Placement - YA - USD ($) shares in Thousands, $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2021	Sep. 30, 2021
Class of Stock [Line Items]
Common shares issued/sold (in shares)	0	1,700
Proceeds received	$ 0	$ 10,000

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Preferred Stock (Details)				3 Months Ended		9 Months Ended		12 Months Ended	19 Months Ended
	Jun. 30, 2021 USD ($)	Apr. 02, 2021 $ / shares shares	Dec. 04, 2019 USD ($)	Sep. 30, 2021 USD ($) $ / shares shares	Sep. 30, 2020 USD ($) shares	Sep. 30, 2021 USD ($) day $ / shares shares	Sep. 30, 2020 USD ($) shares	Dec. 31, 2020 USD ($)	Jun. 30, 2021 USD ($) shares	Jun. 30, 2020 USD ($)	Dec. 31, 2019 USD ($)
Class of Stock [Line Items]
Series Preferred Stock				$ 1,977,000	$ 2,554,000	$ 6,258,000	$ 7,664,000
Common Stock
Class of Stock [Line Items]
Common Shares Issued (in shares) | shares				120,000		7,291,000
Equity Distribution Agreements
Class of Stock [Line Items]
Maximum offering price			$ 40,000,000
Percentage of the gross sales price			2.00%
Series B Preferred Stock
Class of Stock [Line Items]
Preferred stock dividend rate				5.50%	5.50%	5.50%	5.50%	5.50%
Initial conversion/redemption price (in dollars per share) | $ / shares				$ 18.70		$ 18.70
Temporary equity conversion rate						1.3372
Annual preferred stock dividend (in dollars per share) | $ / shares						$ 1.375
Consecutive trading days | day						45
Days ending prior to notice of conversion						3 days
Redemption price (in dollars per share) | $ / shares				$ 25.00		$ 25.00
Redemption percent of liquidation preference				103.00%		103.00%
Liquidation preference per share (in dollars per share) | $ / shares				$ 25.00		$ 25.00
Series Preferred Stock				$ 1,058,000	$ 1,729,000	$ 3,689,000	$ 5,189,000
Preferred Shares Tendered (in shares) | shares				30,000		1,953,000
Issuance of preferred stock (in shares) | shares							23,000
Series Preferred Stock	$ 66,064,000			$ 65,426,000	$ 107,352,000	$ 65,426,000	$ 107,352,000	$ 106,949,000	$ 66,064,000	$ 107,352,000	$ 106,920,000
Series B Preferred Stock | Preferred Stock
Class of Stock [Line Items]
Series Preferred Stock shares issued (in shares) | shares				0	0	0	23,000
Gross proceeds received				$ 0	$ 0	$ 0	$ 439,000
Commissions and other expenses				0	0	0	7,000
Net proceeds				$ 0	$ 0	$ 0	$ 432,000
Series B Preferred Stock | Equity Distribution Agreements
Class of Stock [Line Items]
Shares sold (in shares) | shares									65,000
Proceeds received	1,200,000
Series B Preferred Stock | Minimum
Class of Stock [Line Items]
Percent of conversion price				110.00%		110.00%
Series E Preferred Stock
Class of Stock [Line Items]
Initial conversion/redemption price (in dollars per share) | $ / shares				$ 25.00		$ 25.00
Temporary equity conversion rate						5.69476
Sale of temporary equity, offering price (in dollars per share) | $ / shares				$ 25.00		$ 25.00
Period of preferred dividends in arrears (in months)						18 months
Redemption fee, percent of stated value on the original issue date				8.00%		8.00%
Redemption fee, percent of stated value beginning on the first anniversary				5.00%		5.00%
Redemption fee, percent of stated value beginning on the third anniversary				0.00%		0.00%
Issuance of preferred stock (in shares) | shares				266,000		266,000
Net proceeds				$ 5,976,000		$ 5,976,000
Series Preferred Stock	0			6,110,000		6,110,000		0	$ 0
Adjustments to Series Preferred Stock						1,906,000		0
Dividends declared on Series Preferred Stock				$ 90,000		$ 90,000
Series E Preferred Stock | Initial Closing Date
Class of Stock [Line Items]
Temporary equity, dividend rate (as a percent)						0.0008%
Series E Preferred Stock | First Anniversary From Initial Closing Date
Class of Stock [Line Items]
Temporary equity, dividend rate (as a percent)						0.0775%
Series E Preferred Stock | Second Anniversary From Initial Closing Date
Class of Stock [Line Items]
Temporary equity, dividend rate (as a percent)						0.00075%
Series E Preferred Stock | Equity Distribution Agreements
Class of Stock [Line Items]
Sale of temporary equity, number of shares authorized in transaction (in shares) | shares		20,000,000
Sale of temporary equity, offering price (in dollars per share) | $ / shares		$ 25.00
Series E Preferred Stock | Dividend Reinvestment Plan
Class of Stock [Line Items]
Sale of temporary equity, number of shares authorized in transaction (in shares) | shares		8,000,000
Sale of temporary equity, offering price (in dollars per share) | $ / shares		$ 25.00
Series M Preferred Stock
Class of Stock [Line Items]
Preferred stock dividend rate						0.00082%
Sale of temporary equity, offering price (in dollars per share) | $ / shares		$ 25.00		$ 25.00		$ 25.00
Redemption fee, percent of stated value on the original issue date				1.50%		1.50%
Redemption fee, percent of stated value beginning on the first anniversary				0.00%		0.00%
Issuance of preferred stock (in shares) | shares				15,000		15,000
Net proceeds				$ 355,000		$ 355,000
Series Preferred Stock	$ 0			361,000		361,000		0	$ 0
Adjustments to Series Preferred Stock						(111,000)		$ 0
Dividends declared on Series Preferred Stock				$ 4,000		$ 4,000
Dividend rate (in dollars per share) | $ / shares						$ 2.05
Dividend rate increase each year from original issuance (as a percent)						0.10%
Dividend rate, maximum percentage of stated value				8.70%		8.70%
Series M Preferred Stock | Equity Distribution Agreements
Class of Stock [Line Items]
Sale of temporary equity, number of shares authorized in transaction (in shares) | shares		20,000,000
Sale of temporary equity, offering price (in dollars per share) | $ / shares		$ 25.00
Series M Preferred Stock | Dividend Reinvestment Plan
Class of Stock [Line Items]
Sale of temporary equity, number of shares authorized in transaction (in shares) | shares		8,000,000
Sale of temporary equity, offering price (in dollars per share) | $ / shares		$ 25.00

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Related Party Transactions (Narrative) (Details)						3 Months Ended				9 Months Ended
	Dec. 31, 2020 USD ($)	Mar. 20, 2020 USD ($)	Sep. 25, 2019 USD ($)	Jan. 15, 2019 USD ($)	Aug. 08, 2018 USD ($)	Sep. 30, 2021 USD ($) hotel	Jun. 30, 2021 USD ($)	Mar. 31, 2021 USD ($)	Sep. 30, 2020 USD ($) hotel	Sep. 30, 2021 USD ($) hotel	Sep. 30, 2020 USD ($) hotel
Related Party Transaction [Line Items]
Base fee, net asset fee adjustment (as a percent)						0.70%				0.70%
Minimum base fee (as a percent)						90.00%				90.00%
Term of advisory agreement (in years)										3 years
Aggregate non-listed preferred equity offerings	$ 400,000,000		$ 400,000,000
Capital contributions	3,750,000
Due to Ashford Inc.	2,772,000					$ 820,000				$ 820,000
Advisory agreement, percent of total construction costs					6.50%
Advisory agreement, construction management fees (as a percent)					10.00%
Advisory agreement, interior design fees (as a percent)					6.00%
Advisory agreement, FF&E purchasing fees (as a percent)					8.00%
Advisory Agreement, FF&E purchasing fees, freight and tax threshold					$ 2,000,000
Advisory Agreement, FF&E purchasing fees, with freight and tax threshold (as a percent)					6.00%
Number of hotel properties | hotel						14			13	14	13
Due from related parties, net	$ 991,000					$ 1,910,000				$ 1,910,000
Gain on legal settlement						0			$ 0	989,000	$ 0
Ashford Inc.
Related Party Transaction [Line Items]
Allocation percentage	50.00%		25.00%
Ashford Inc. | Ashford Trust
Related Party Transaction [Line Items]
Allocation percentage	0.00%		75.00%
Ashford Inc. | Ashford Inc.
Related Party Transaction [Line Items]
Allocation percentage	50.00%
Purchase of FF&E | Affiliated Entity
Related Party Transaction [Line Items]
Related party transaction amount							$ 144,000
Design and construction fees
Related Party Transaction [Line Items]
Percentage of project costs					4.00%
Lismore Capital | Subsidiaries
Related Party Transaction [Line Items]
Related party transaction amount		$ 1,400,000						$ 4,100,000
Advisory services, expense included in write-off of loan costs and exit fees						0			$ 1,200,000	341,000	$ 2,700,000
Lismore Capital | Periodic installments | Subsidiaries
Related Party Transaction [Line Items]
Related party transaction amount								1,400,000
Amount expensed								683,000
Payment amount to be offset against future fees								681,000
Lismore Capital | Success fees | Subsidiaries
Related Party Transaction [Line Items]
Related party transaction amount								$ 1,400,000
Lismore Capital | Debt placement fee | Subsidiaries
Related Party Transaction [Line Items]
Amount expensed										150,000
Ashford Inc.
Related Party Transaction [Line Items]
Amount funded						2,800,000				2,800,000
Ashford Inc. | Other Assets
Related Party Transaction [Line Items]
Amount funded						144,000				144,000
Ashford LLC
Related Party Transaction [Line Items]
ERFP agreement, percent of property acquisition price				10.00%
ERFP agreement, funding term (in years)				2 years
ERFP agreement, initial term (in years)				2 years
ERFP agreement, renewal term (in years)				1 year
ERFP agreement, notice term (in days)				60 days
Ashford LLC | Hotel FF&E
Related Party Transaction [Line Items]
Proceeds from sale of hotel FF&E							$ 1,600,000
Gain on sale of hotel FF&E						$ 0				$ 197,000
Remington Hotels
Related Party Transaction [Line Items]
Number of hotel properties managed by related party | hotel						4				4
Ashford Trust | Legal settlement | Affiliated Entity
Related Party Transaction [Line Items]
Due from related parties, net						$ 800,000				$ 800,000
Gain on legal settlement										800,000
Maximum | Ashford Inc.
Related Party Transaction [Line Items]
Funding amount			$ 15,000,000
Maximum | Ashford LLC
Related Party Transaction [Line Items]
ERFP agreement, commitment				$ 50,000,000
ERFP agreement, commitment with increase				$ 100,000,000
Minimum | Management fees
Related Party Transaction [Line Items]
Monthly property management fee										$ 15,000
Property management fee, percent										3.00%
Minimum | Remington Hotels | Management fees
Related Party Transaction [Line Items]
Monthly property management fee										$ 14,000
Property management fee, percent										3.00%

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Related Party Transactions (Schedule of Advisory Services Fee) (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Related Party Transaction [Line Items]
Advisory services fee	$ 4,809	$ 4,575	$ 16,343	$ 14,545
Ashford LLC | Affiliated Entity
Related Party Transaction [Line Items]
Advisory services fee	4,809	4,575	16,343	14,545
Ashford LLC | Affiliated Entity | Base advisory fee
Related Party Transaction [Line Items]
Advisory services fee	2,758	2,386	7,981	7,579
Ashford LLC | Affiliated Entity | Reimbursable expenses
Related Party Transaction [Line Items]
Advisory services fee	694	404	1,696	1,360
Ashford LLC | Affiliated Entity | Equity-based compensation
Related Party Transaction [Line Items]
Advisory services fee	2,994	1,785	6,666	5,606
Ashford LLC | Affiliated Entity | Incentive fee
Related Party Transaction [Line Items]
Advisory services fee	$ (1,637)	$ 0	$ 0	$ 0

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Related Party Transactions (Schedule of Reimbursed Operating Expenses) (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Ashford Inc.
Related Party Transaction [Line Items]
Corporate, general and administrative	$ 642	$ 228	$ 1,505	$ 558

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Commitments and Contingencies - Narrative (Details)		9 Months Ended
	Aug. 05, 2021	Sep. 30, 2021 USD ($) managementCompany hotel	Sep. 30, 2020 hotel	Jul. 20, 2020 USD ($)	Dec. 20, 2016 hotel managementCompany
Loss Contingencies [Line Items]
Number of hotel properties | hotel		14	13
Pending Litigation | Accor
Loss Contingencies [Line Items]
Incorrect amount payable to cure performance test failure				$ 1,031,549
Correct amount payable to cure performance test failure				$ 535,120
Amounts accrued		$ 0
Pending Litigation | California Hotel Employment Policies and Practices
Loss Contingencies [Line Items]
Amounts accrued		$ 500,000
Number of hotel management companies | managementCompany		1
Number of hotel properties | hotel		1
Class Action Lawsuit, California Employment Laws
Loss Contingencies [Line Items]
Amounts accrued		$ 0
Number of hotel management companies | managementCompany					1
Number of hotel properties | hotel					2
Intellectual Property Sublease Agreement
Loss Contingencies [Line Items]
Licensing fee, percent fee of total operating revenue	1.00%
Licensing fee, percent fee of gross food and beverage revenues	2.00%
Licensing fee, percent fee of food and beverage profits	25.00%
Minimum | Management fees
Loss Contingencies [Line Items]
Monthly property management fee		$ 15,000
Property management fee, percent		3.00%
Minimum | Restricted Cash
Loss Contingencies [Line Items]
Replacement reserve escrow as percentage of property revenue		4.00%
Minimum | Management fees
Loss Contingencies [Line Items]
Property management fee, percent		2.50%
Maximum | Pending Litigation | California Hotel Employment Policies and Practices
Loss Contingencies [Line Items]
Potential loss amount		$ 500,000
Maximum | Restricted Cash
Loss Contingencies [Line Items]
Replacement reserve escrow as percentage of property revenue		5.00%
Maximum | Management fees
Loss Contingencies [Line Items]
Property management fee, percent		5.00%

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Commitments and Contingencies - Schedule of Licensing Fees Incurred (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2021	Sep. 30, 2020	Sep. 30, 2021	Sep. 30, 2020
Other Commitments [Line Items]
Other hotel expenses	$ 77,043	$ 37,806	$ 199,317	$ 146,093
Intellectual Property Sublease Agreement
Other Commitments [Line Items]
Other hotel expenses	$ 53		$ 53

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Segment Reporting (Details)	9 Months Ended
	Sep. 30, 2021 segment
Segment Reporting [Abstract]
Number of operating segments	1