Related Party Transactions (Tables)

6 Months Ended

Jun. 30, 2020

The following table summarizes the revenues related to Braemar (in thousands):



	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
REVENUES BY TYPE
Advisory services revenue:
Base advisory fee	$	2,573	$	2,775	$	5,193	$	5,352
Incentive advisory fee ⁽¹⁾	169		169		339		339
Other advisory revenue ⁽²⁾	131		130		260		258
Total advisory services revenue	2,873		3,074		5,792		5,949

Hotel management:
Base management fees ⁽³⁾	154		—		509		—

Project management revenue⁽⁴⁾	712		2,078		1,455		4,449
Audio visual revenue ⁽⁵⁾	—		—		—		—

Other revenue
Debt placement and related fees ⁽⁶⁾	646		—		646		275
Claims management services ⁽⁷⁾	45		35		83		65
Lease revenue ⁽⁸⁾	—		84		—		168
Other services ⁽⁹⁾	53		279		475		548
Total other revenue	744		398		1,204		1,056

Cost reimbursement revenue	3,490		2,940		10,360		5,254

Total revenues	$	7,973	$	8,490	$	19,320	$	16,708

REVENUES BY SEGMENT ⁽¹⁰⁾
REIT advisory	$	5,184	$	5,718	$	10,530	$	10,645
Remington	1,032		—		5,249		—
Premier	897		2,493		1,990		5,240
OpenKey	11		13		71		33
Corporate and other	849		266		1,480		790
Total revenues	$	7,973	$	8,490	$	19,320	$	16,708

COST OF REVENUES
Cost of audio visual revenues ⁽⁵⁾	$	—	$	119	$	447	$	205

SUPPLEMENTAL REVENUE INFORMATION
Audio visual revenues from guests at REIT properties ⁽⁵⁾	$	—	$	266	$	1,005	$	449

________

⁽¹⁾

Incentive advisory fee for the three and six months June 30, 2020, includes the pro-rata portion of the third year installment of the 2018 incentive advisory fee, which will be paid in January 2021, and for the three and six months June 30, 2019, includes the pro-rata portion of the second year installment of the 2018 incentive advisory fee, which was paid in January 2020. Incentive fee payments are subject to meeting the December 31 FCCR Condition each year, as defined in the Braemar advisory agreement.

Braemar’s annual total stockholder return did not meet the relevant incentive fee thresholds during the 2019 and 2017 measurement periods. See note 3.


⁽²⁾	In connection with our Fourth Amended and Restated Braemar Advisory Agreement, a $5.0 million cash payment was made by Braemar upon approval by Braemar’s stockholders, which is recognized over the 10-year initial term.

⁽³⁾

Hotel management revenue is reported within our Remington segment. Base management fees are recognized when services have been rendered. Remington receives base management fees of 3% of gross hotel revenue for managing the hotel employees and daily operations of the hotels, subject to a specified floor (which is subject to increase annually based on increases in the consumer price index). See note 3 for discussion of the hotel management revenue recognition policy.

⁽⁴⁾

Project management revenue primarily consists of revenue generated within our Premier segment by providing design, development, architectural, and project management services for which Premier receives fees. Project management revenue also includes revenue from reimbursable costs related to accounting, overhead and project manager services provided to projects owned by affiliates of Ashford Trust, Braemar and other owners. See note 3 for discussion of the project management revenue recognition policy.

⁽⁵⁾

JSAV primarily contracts directly with customers to whom it provides audio visual services. JSAV recognizes the gross revenue collected from their customers by the hosting hotel or venue. Commissions retained by the hotel or venue, including Braemar, are recognized in “cost of revenues for audio visual” in our condensed consolidated statements of operations.See note 3 for discussion of the audio visual revenue recognition policy.


⁽⁶⁾	Debt placement and related fees are earned by Lismore for providing debt placement, modification, forbearance and refinancing services.


⁽⁷⁾	Claims management services include revenue earned from providing insurance claim assessment and administration services.

⁽⁸⁾

In connection with our legacy key money transaction with Braemar which commenced prior to 2019, we lease FF&E to Braemar rent-free. Consistent with our accounting treatment prior to adopting ASU 2016-02, other revenue for the three and six months ended June 30, 2019, includes a portion of the base advisory fee for leases commencing prior to our adoption, which is equal to the estimated fair value of the lease payments that would have been made.


⁽⁹⁾	Other services revenue is primarily associated with other hotel products and services, such as mobile key applications, marine vessel transportation and hypoallergenic premium rooms, provided to Braemar by our consolidated subsidiaries, OpenKey, RED and Pure Wellness.

⁽¹⁰⁾

See note 16 for discussion of segment reporting.

The following table summarizes the revenues and expenses related to Ashford Trust (in thousands):



	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
REVENUES BY TYPE
Advisory services revenue:
Base advisory fee	$	8,557	$	8,415	$	17,474	$	16,460

Hotel management:
Base management fees ⁽¹⁾	3,504		—		9,197		—

Project management revenue ⁽²⁾	838		4,273		3,920		8,289
Audio visual revenue ⁽³⁾	—		—		—		—

Other revenue
Debt placement and related fees ⁽⁴⁾	689		79		817		1,158
Claims management services ⁽⁵⁾	27		20		46		31
Lease revenue ⁽⁶⁾	—		945		—		1,891
Other services ⁽⁷⁾	336		409		786		876
Total other revenue	1,052		1,453		1,649		3,956

Cost reimbursement revenue	19,947		8,346		88,020		15,956

Total revenues	$	33,898	$	22,487	$	120,260	$	44,661

REVENUES BY SEGMENT ⁽⁸⁾
REIT advisory	$	10,354	$	16,923	$	25,962	$	32,612
Remington	20,739		—		86,274		—
Premier	1,319		5,076		5,261		10,015
OpenKey	30		27		129		55
Corporate and other	1,456		461		2,634		1,979
Total revenues	$	33,898	$	22,487	$	120,260	$	44,661

COST OF REVENUES
Cost of audio visual revenues⁽³⁾	$	3	$	1,862	$	2,014	$	3,546

SUPPLEMENTAL REVENUE INFORMATION
Audio visual revenue from guests at REIT properties ⁽³⁾	$	7	$	4,227	$	4,604	$	8,050

________

⁽¹⁾


⁽²⁾	Project management revenue primarily consists of revenue generated within our Premier segment by providing design, development, architectural, and project management services for which Premier receives fees. Project management revenue also includes revenue from reimbursable costs related to accounting, overhead and project manager services provided to

projects owned by affiliates of Ashford Trust, Braemar and other owners. See note 3 for discussion of the project management revenue recognition policy.

⁽³⁾

JSAV primarily contracts directly with customers to whom it provides audio visual services. JSAV recognizes the gross revenue collected from their customers by the hosting hotel or venue. Commissions retained by the hotel or venue, including Ashford Trust, are recognized in “cost of revenues for audio visual” in our condensed consolidated statements of operations.See note 3 for discussion of the audio visual revenue recognition policy.


⁽⁴⁾	Debt placement and related fees are earned by Lismore for providing debt placement, modification, forbearance and refinancing services.^.


⁽⁵⁾	Claims management services include revenue earned from providing insurance claim assessment and administration services.

⁽⁶⁾

In connection with our ERFP Agreements and legacy key money transaction with Ashford Trust, we lease FF&E to Ashford Trust rent-free. Our ERFP leases entered into in 2018 commenced on December 31, 2018. Consistent with our accounting treatment prior to adopting ASU 2016-02, other revenue for the three and six months ended June 30, 2019, includes a portion of the base advisory fee for leases commencing prior to our adoption, which is equal to the estimated fair value of the lease payments that would have been made.


⁽⁷⁾	Other services revenue is primarily associated with other hotel products and services, such as mobile key applications and hypoallergenic premium rooms, provided to Ashford Trust by our consolidated subsidiaries, OpenKey and Pure Wellness.

⁽⁸⁾

See note 16 for discussion of segment reporting.