UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________________
FORM 10-Q
____________________________
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2022March 31, 2023
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period ended ______ to ______
Commission file number 001-36594
___________________________

Xenia Hotels & Resorts, Inc.

(Exact Name of Registrant as Specified in Its Charter)
_______________________
Maryland 20-0141677
(State of Incorporation) (I.R.S. Employer Identification No.)
   
200 S. Orange Avenue
Suite 2700, Orlando, Florida 32801
(Address of Principal Executive Offices) (Zip Code)
(407) 246-8100
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading SymbolName of each exchange on which registered
Common StockXHRNew York Stock Exchange
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, smaller reporting company, or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filerAccelerated filer
Non-accelerated filerSmaller 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
As of October 31, 2022,May 2, 2023, there were 113,847,779109,486,200 shares of the registrant’s common stock outstanding.



XENIA HOTELS & RESORTS, INC.
TABLE OF CONTENTS
Part I - Financial InformationPage
Item 1.Financial Statements (unaudited)
Condensed Consolidated Balance Sheets as of September 30, 2022March 31, 2023 and December 31, 20212022
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for the Three and Nine Months Ended September 30,March 31, 2023 and 2022 and 2021
Condensed Consolidated Statements of Changes in Equity for the Three and Nine Months Ended September 30,March 31, 2023 and 2022 and 2021
Condensed Consolidated Statements of Cash Flows for the NineThree Months Ended September 30,March 31, 2023 and 2022 and 2021
Notes to the Condensed Consolidated Financial Statements
Item 2.Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3.Quantitative and Qualitative Disclosures About Market Risk
Item 4.Controls and Procedures
Part II - Other Information
Item 1.Legal Proceedings
Item 1A.Risk Factors
Item 2.Unregistered Sales of Equity Securities and Use of Proceeds
Item 3.Defaults Upon Senior Securities
Item 4.Mine Safety Disclosures
Item 5.Other Information
Item 6.Exhibits
Signatures



PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
XENIA HOTELS & RESORTS, INC.
Condensed Consolidated Balance Sheets
As of September 30, 2022March 31, 2023 and December 31, 20212022
(Dollar amounts in thousands, except per share data)
September 30, 2022December 31, 2021March 31, 2023December 31, 2022
AssetsAssets(Unaudited)(Audited)Assets(Unaudited)(Audited)
Investment properties:Investment properties:Investment properties:
LandLand$460,615 $431,427 Land$460,376 $460,536 
Buildings and other improvementsBuildings and other improvements3,091,556 2,856,671 Buildings and other improvements3,097,866 3,086,785 
TotalTotal$3,552,171 $3,288,098 Total$3,558,242 $3,547,321 
Less: accumulated depreciationLess: accumulated depreciation(945,659)(888,717)Less: accumulated depreciation(979,373)(945,786)
Net investment propertiesNet investment properties$2,606,512 $2,399,381 Net investment properties$2,578,869 $2,601,535 
Cash and cash equivalentsCash and cash equivalents259,885 517,377 Cash and cash equivalents283,154 305,103 
Restricted cash and escrowsRestricted cash and escrows50,788 36,854 Restricted cash and escrows58,206 60,807 
Accounts and rents receivable, net of allowance for doubtful accountsAccounts and rents receivable, net of allowance for doubtful accounts38,709 28,528 Accounts and rents receivable, net of allowance for doubtful accounts48,255 37,562 
Intangible assets, net of accumulated amortization of $2,604 and $2,231, respectively5,162 5,446 
Intangible assets, net of accumulated amortization of $1,108 and $1,068, respectivelyIntangible assets, net of accumulated amortization of $1,108 and $1,068, respectively5,019 5,060 
Other assetsOther assets62,371 65,109 Other assets77,401 69,988 
Assets held for sale (Note 4)68,939 34,621 
Total assetsTotal assets$3,092,366 $3,087,316 Total assets$3,050,904 $3,080,055 
LiabilitiesLiabilitiesLiabilities
Debt, net of loan premiums, discounts and unamortized deferred financing costs (Note 5)Debt, net of loan premiums, discounts and unamortized deferred financing costs (Note 5)$1,429,518 $1,494,231 Debt, net of loan premiums, discounts and unamortized deferred financing costs (Note 5)$1,429,516 $1,429,105 
Accounts payable and accrued expensesAccounts payable and accrued expenses107,823 84,051 Accounts payable and accrued expenses95,982 107,097 
Distributions payableDistributions payable11,660 89 Distributions payable11,334 11,455 
Other liabilitiesOther liabilities80,864 68,559 Other liabilities83,200 72,390 
Liabilities associated with assets held for sale (Note 4)3,532 2,305 
Total liabilitiesTotal liabilities$1,633,397 $1,649,235 Total liabilities$1,620,032 $1,620,047 
Commitments and Contingencies (Note 12)
Commitments and Contingencies (Note 11)Commitments and Contingencies (Note 11)
Stockholders' equityStockholders' equityStockholders' equity
Common stock, $0.01 par value, 500,000,000 shares authorized, 114,263,213 and 114,306,727 shares issued and outstanding as of September 30, 2022 and December 31, 2021, respectively$1,143 $1,143 
Common stock, $0.01 par value, 500,000,000 shares authorized, 110,661,486 and 112,519,672 shares issued and outstanding as of March 31, 2023 and December 31, 2022, respectivelyCommon stock, $0.01 par value, 500,000,000 shares authorized, 110,661,486 and 112,519,672 shares issued and outstanding as of March 31, 2023 and December 31, 2022, respectively$1,107 $1,126 
Additional paid in capitalAdditional paid in capital2,089,463 2,090,393 Additional paid in capital2,036,707 2,063,273 
Accumulated other comprehensive income (loss)94 (4,089)
Accumulated distributions in excess of net earningsAccumulated distributions in excess of net earnings(647,248)(656,461)Accumulated distributions in excess of net earnings(628,060)(623,216)
Total Company stockholders' equityTotal Company stockholders' equity$1,443,452 $1,430,986 Total Company stockholders' equity$1,409,754 $1,441,183 
Non-controlling interestsNon-controlling interests15,517 7,095 Non-controlling interests21,118 18,825 
Total equityTotal equity$1,458,969 $1,438,081 Total equity$1,430,872 $1,460,008 
Total liabilities and equityTotal liabilities and equity$3,092,366 $3,087,316 Total liabilities and equity$3,050,904 $3,080,055 
See accompanying notes to the condensed consolidated financial statements.
1


XENIA HOTELS & RESORTS, INC.
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)
For the Three and Nine Months Ended September 30, 2022March 31, 2023 and 20212022
(Unaudited)
(Dollar amounts in thousands, except per share data)
Three Months Ended September 30,Nine Months Ended September 30,Three Months Ended March 31,
202220212022202120232022
Revenues:Revenues:Revenues:
Rooms revenuesRooms revenues$142,604 $109,753 $431,382 $260,594 Rooms revenues$153,645 $123,198 
Food and beverage revenuesFood and beverage revenues76,153 44,004 240,669 105,739 Food and beverage revenues96,124 67,735 
Other revenuesOther revenues21,911 19,027 62,415 46,277 Other revenues19,204 19,414 
Total revenuesTotal revenues$240,668 $172,784 $734,466 $412,610 Total revenues$268,973 $210,347 
Expenses:Expenses:Expenses:
Rooms expensesRooms expenses36,163 27,099 101,803 65,024 Rooms expenses36,203 29,217 
Food and beverage expensesFood and beverage expenses55,888 33,764 161,796 80,534 Food and beverage expenses60,687 45,610 
Other direct expensesOther direct expenses6,155 5,059 17,815 12,993 Other direct expenses5,698 5,294 
Other indirect expensesOther indirect expenses64,590 50,902 181,509 132,276 Other indirect expenses66,499 53,860 
Management and franchise feesManagement and franchise fees9,083 6,025 27,758 15,009 Management and franchise fees10,189 7,626 
Total hotel operating expensesTotal hotel operating expenses$171,879 $122,849 $490,681 $305,836 Total hotel operating expenses$179,276 $141,607 
Depreciation and amortizationDepreciation and amortization34,311 32,076 99,127 98,281 Depreciation and amortization33,741 30,565 
Real estate taxes, personal property taxes and insuranceReal estate taxes, personal property taxes and insurance11,228 9,731 33,452 31,268 Real estate taxes, personal property taxes and insurance12,470 10,855 
Ground lease expenseGround lease expense685 405 2,035 1,187 Ground lease expense710 517 
General and administrative expensesGeneral and administrative expenses8,972 7,466 25,841 22,484 General and administrative expenses8,783 7,611 
Gain on business interruption insurance(2,487)— (2,487)(1,116)
Other operating expensesOther operating expenses232 175 
Impairment and other lossesImpairment and other losses— 1,759 1,278 14,072 Impairment and other losses— 1,278 
Total expensesTotal expenses$224,588 $174,286 $649,927 $472,012 Total expenses$235,212 $192,608 
Operating income (loss)$16,080 $(1,502)$84,539 $(59,402)
Operating incomeOperating income$33,761 $17,739 
Other income (loss)Other income (loss)1,767 186 2,671 (2,503)Other income (loss)1,284 (777)
Interest expenseInterest expense(20,583)(21,358)(61,474)(59,799)Interest expense(22,134)(20,538)
Loss on extinguishment of debtLoss on extinguishment of debt— — (294)(1,356)Loss on extinguishment of debt(1,140)(294)
Net income (loss) before income taxesNet income (loss) before income taxes$(2,736)$(22,674)$25,442 $(123,060)Net income (loss) before income taxes$11,771 $(3,870)
Income tax benefit (expense)1,029 (43)(4,148)(377)
Income tax expenseIncome tax expense(5,218)(1,607)
Net income (loss)Net income (loss)$(1,707)$(22,717)$21,294 $(123,437)Net income (loss)$6,553 $(5,477)
Net loss (income) attributable to non-controlling interests (Note 1)Net loss (income) attributable to non-controlling interests (Note 1)44 524 (633)2,855 Net loss (income) attributable to non-controlling interests (Note 1)(273)153 
Net income (loss) attributable to common stockholdersNet income (loss) attributable to common stockholders$(1,663)$(22,193)$20,661 $(120,582)Net income (loss) attributable to common stockholders$6,280 $(5,324)

2


XENIA HOTELS & RESORTS, INC.
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss), Continued
For the Three and Nine Months Ended September 30, 2022March 31, 2023 and 20212022
(Unaudited)
(Dollar amounts in thousands, except per share data)
Three Months Ended September 30,Nine Months Ended September 30,Three Months Ended March 31,
202220212022202120232022
Basic and diluted income (loss) per shareBasic and diluted income (loss) per shareBasic and diluted income (loss) per share
Net income (loss) per share available to common stockholders - basic and dilutedNet income (loss) per share available to common stockholders - basic and diluted$(0.01)$(0.20)$0.18 $(1.06)Net income (loss) per share available to common stockholders - basic and diluted$0.06 $(0.05)
Weighted-average number of common shares (basic)Weighted-average number of common shares (basic)114,322,269 113,809,212 114,334,110 113,798,761 Weighted-average number of common shares (basic)111,777,894 114,326,406 
Weighted-average number of common shares (diluted)Weighted-average number of common shares (diluted)114,322,269 113,809,212 114,719,309 113,798,761 Weighted-average number of common shares (diluted)112,037,369 114,326,406 
Comprehensive income (loss):Comprehensive income (loss):Comprehensive income (loss):
Net income (loss)Net income (loss)$(1,707)$(22,717)$21,294 $(123,437)Net income (loss)$6,553 $(5,477)
Other comprehensive income (loss):Other comprehensive income (loss):Other comprehensive income (loss):
Unrealized gain (loss) on interest rate derivative instruments36 (163)2,932 2,389 
Reclassification adjustment for amounts recognized in net (loss) income (interest expense)(147)1,598 1,697 5,999 
Unrealized gain on interest rate derivative instrumentsUnrealized gain on interest rate derivative instruments— 2,517 
Reclassification adjustment for amounts recognized in net income (loss) (interest expense)Reclassification adjustment for amounts recognized in net income (loss) (interest expense)— 1,152 
$(1,818)$(21,282)$25,923 $(115,049)$6,553 $(1,808)
Comprehensive loss (income) attributable to non-controlling interests (Note 1)47 490 (1,079)2,649 
Comprehensive (income) loss attributable to non-controlling interests (Note 1)Comprehensive (income) loss attributable to non-controlling interests (Note 1)(273)(264)
Comprehensive income (loss) attributable to the CompanyComprehensive income (loss) attributable to the Company$(1,771)$(20,792)$24,844 $(112,400)Comprehensive income (loss) attributable to the Company$6,280 $(2,072)
See accompanying notes to the condensed consolidated financial statements.
3


XENIA HOTELS & RESORTS, INC.
Condensed Consolidated Statements of Changes in Equity
For the Three Months Ended September 30,March 31, 2023 and 2022 and 2021
(Unaudited)
(Dollar amounts in thousands, except per share data)

Common Stock
SharesAmountAdditional paid in capitalAccumulated other comprehensive income (loss)Distributions in excess of retained earningsNon-controlling interests of Operating PartnershipTotal
Balance at June 30, 2022114,353,273 $1,144 $2,091,042 $202 $(634,137)$13,330 $1,471,581 
Net loss— — — — (1,663)(44)(1,707)
Repurchase of common shares, net(120,978)$(1)$(1,877)$— $— $— $(1,878)
Dividends, common share / units ($0.10)— — — — (11,448)(204)(11,652)
Share-based compensation40,871 — 435 — — 2,438 2,873 
Shares redeemed to satisfy tax withholding on vested share-based compensation(9,953)— (137)— — — (137)
Other comprehensive loss:
Unrealized gain on interest rate derivative instruments— — — 35 — 36 
Reclassification adjustment for amounts recognized in net loss— — — (143)— (4)(147)
Balance at September 30, 2022114,263,213 $1,143 $2,089,463 $94 $(647,248)$15,517 $1,458,969 
Common Stock
SharesAmountAdditional paid in capitalAccumulated other comprehensive income (loss)Distributions in excess of retained earningsNon-controlling interests of Operating PartnershipTotal
Balance at December 31, 2022112,519,672 $1,126 $2,063,273 $— $(623,216)$18,825 $1,460,008 
Net income— — — — 6,280 273 6,553 
Repurchase of common shares, net(1,905,820)$(19)$(26,727)$— $— $— $(26,746)
Dividends, common share / units ($0.10)— — — — (11,124)(228)(11,352)
Share-based compensation65,247 — 419 — — 2,248 2,667 
Shares redeemed to satisfy tax withholding on vested share-based compensation(17,613)— (258)— — — (258)
Balance at March 31, 2023110,661,486 $1,107 $2,036,707 $— $(628,060)$21,118 $1,430,872 
    
Balance at June 30, 2021114,209,134 $1,142 $2,089,550 $(7,644)$(611,391)$3,437 $1,475,094 
Net loss— — — — (22,193)(524)(22,717)
Share-based compensation— — 779 — — 2,172 2,951 
Other comprehensive loss:
Unrealized loss on interest rate derivative instruments— — — (160)— (3)(163)
Reclassification adjustment for amounts recognized in net loss— — — 1,561 — 37 1,598 
Balance at September 30, 2021114,209,134 $1,142 $2,090,329 $(6,243)$(633,584)$5,119 $1,456,763 
Balance at December 31, 2021114,306,727 $1,143 $2,090,393 $(4,089)$(656,461)$7,095 $1,438,081 
Net loss— — — — (5,324)(153)(5,477)
Share-based compensation63,024 537 — — 1,897 2,435 
Shares redeemed to satisfy tax withholding on vested share-based compensation(16,478)— (303)— — — (303)
Other comprehensive income (loss):
Unrealized gain on interest rate derivative instruments— — — 2,133 — 384 2,517 
Reclassification adjustment for amounts recognized in net loss— — — 1,119 — 33 1,152 
Balance at March 31, 2022114,353,273 $1,144 $2,090,627 $(837)$(661,785)$9,256 $1,438,405 
See accompanying notes to the condensed consolidated financial statements.
4


XENIA HOTELS & RESORTS, INC.
Condensed Consolidated Statements of Changes in Equity
For the Nine Months Ended September 30, 2022 and 2021
(Unaudited)
(Dollar amounts in thousands, except per share data)
Common Stock
SharesAmountAdditional paid in capitalAccumulated other comprehensive income (loss)Distributions in excess of retained earningsNon-controlling Interests of Operating PartnershipTotal
Balance at December 31, 2021114,306,727 $1,143 $2,090,393 $(4,089)$(656,461)$7,095 $1,438,081 
Net income— — — — 20,661 633 21,294 
Repurchase of common shares, net(120,978)(1)(1,877)— — — (1,878)
Dividends, common share / units ($0.10)— — — — (11,448)(204)(11,652)
Share-based compensation103,895 1,387 — 7,547 8,935 
Shares redeemed to satisfy tax withholding on vested share-based compensation(26,431)— (440)— — — (440)
Other comprehensive income:
Unrealized gain on interest rate derivative instruments— — — 2,535 — 397 2,932 
Reclassification adjustment for amounts recognized in net income— — — 1,648 — 49 1,697 
Balance at September 30, 2022114,263,213 $1,143 $2,089,463 $94 $(647,248)$15,517 $1,458,969 
Balance at December 31, 2020113,755,513 $1,138 $2,080,364 $(14,425)$(513,002)$12,788 $1,566,863 
Net loss— — — — (120,582)(2,855)(123,437)
Share-based compensation72,692 — 2,694 — — 6,661 9,355 
Shares redeemed to satisfy tax withholding on vested share-based compensation(18,993)— (318)— — — (318)
Redemption of Operating Partnership Units399,922 7,589 — — (11,681)(4,088)
Other comprehensive income:
Unrealized gain on interest rate derivative instruments— — — 2,334 — 55 2,389 
Reclassification adjustment for amounts recognized in net loss— — — 5,848 — 151 5,999 
Balance at September 30, 2021114,209,134 $1,142 $2,090,329 $(6,243)$(633,584)$5,119 $1,456,763 
See accompanying notes to the condensed consolidated financial statements.
5


XENIA HOTELS & RESORTS, INC.
Condensed Consolidated Statements of Cash Flows
For the NineThree Months Ended September 30,March 31, 2023 and 2022 and 2021
(Unaudited)
(Dollar amounts in thousands)
Nine Months Ended September 30,Three Months Ended March 31,
2022202120232022
Cash flows from operating activities:Cash flows from operating activities:Cash flows from operating activities:
Net income (loss)Net income (loss)$21,294 $(123,437)Net income (loss)$6,553 $(5,477)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:Adjustments to reconcile net income (loss) to net cash provided by operating activities:Adjustments to reconcile net income (loss) to net cash provided by operating activities:
DepreciationDepreciation98,709 97,478 Depreciation33,687 30,429 
Non-cash ground rent and amortization of other intangiblesNon-cash ground rent and amortization of other intangibles418 803 Non-cash ground rent and amortization of other intangibles54 136 
Amortization of debt premiums, discounts, and financing costsAmortization of debt premiums, discounts, and financing costs3,925 4,615 Amortization of debt premiums, discounts, and financing costs1,282 1,286 
Loss on extinguishment of debtLoss on extinguishment of debt294 1,356 Loss on extinguishment of debt1,140 294 
Impairment and other losses— 13,072 
Gain on insurance recoveriesGain on insurance recoveries(3,550)— Gain on insurance recoveries— (994)
Share-based compensation expenseShare-based compensation expense8,598 8,813 Share-based compensation expense2,591 2,207 
Deferred interest expenseDeferred interest expense(409)— Deferred interest expense(1,296)(409)
Changes in assets and liabilities:Changes in assets and liabilities:Changes in assets and liabilities:
Accounts and rents receivableAccounts and rents receivable(10,435)(15,683)Accounts and rents receivable(10,693)(7,599)
Other assetsOther assets1,013 1,343 Other assets(4,127)(5,315)
Accounts payable and accrued expensesAccounts payable and accrued expenses25,282 28,742 Accounts payable and accrued expenses(9,507)8,234 
Other liabilitiesOther liabilities12,755 12,251 Other liabilities10,629 9,780 
Net cash provided by operating activitiesNet cash provided by operating activities$157,894 $29,353 Net cash provided by operating activities$30,313 $32,572 
Cash flows from investing activities:Cash flows from investing activities:Cash flows from investing activities:
Purchase of investment propertiesPurchase of investment properties(328,493)— Purchase of investment properties— (328,493)
Capital expendituresCapital expenditures(40,682)(19,150)Capital expenditures(11,634)(7,499)
Proceeds from sale of investment propertiesProceeds from sale of investment properties32,820 — Proceeds from sale of investment properties— 32,820 
Proceeds from property insuranceProceeds from property insurance3,723 — Proceeds from property insurance— 1,168 
Performance guaranty paymentsPerformance guaranty payments1,695 2,524 Performance guaranty payments1,071 912 
Net cash used in investing activitiesNet cash used in investing activities$(330,937)$(16,626)Net cash used in investing activities$(10,563)$(301,092)
Cash flows from financing activities:Cash flows from financing activities:Cash flows from financing activities:
Proceeds from mortgage debt modificationProceeds from mortgage debt modification440 — 
Payoff of mortgage debtPayoff of mortgage debt(65,000)(56,750)Payoff of mortgage debt(99,488)(65,000)
Principal payments of mortgage debtPrincipal payments of mortgage debt(3,093)(4,888)Principal payments of mortgage debt(890)(932)
Proceeds from 2023 Term LoansProceeds from 2023 Term Loans225,000 — 
Principal payments on Corporate Credit Facility Term LoanPrincipal payments on Corporate Credit Facility Term Loan— (150,000)Principal payments on Corporate Credit Facility Term Loan(125,000)— 
Payments on the Revolving Credit Facility— (163,093)
Proceeds from Senior Notes— 500,000 
Payment of loan fees and issuance costsPayment of loan fees and issuance costs— (10,233)Payment of loan fees and issuance costs(5,554)— 
Payment loan modification feesPayment loan modification fees(25)— 
Repurchase of common sharesRepurchase of common shares(1,878)— Repurchase of common shares(26,746)— 
Redemption of Operating Partnership Units— (4,088)
Shares redeemed to satisfy tax withholding on vested share-based compensationShares redeemed to satisfy tax withholding on vested share-based compensation(490)(443)Shares redeemed to satisfy tax withholding on vested share-based compensation(578)(490)
Dividends and dividend equivalentsDividends and dividend equivalents(54)(54)Dividends and dividend equivalents(11,459)(54)
Net cash (used in) provided by financing activities$(70,515)$110,451 
Net (decrease) increase in cash and cash equivalents and restricted cash(243,558)123,178 
Net cash used in financing activitiesNet cash used in financing activities$(44,300)$(66,476)
Net decrease in cash and cash equivalents and restricted cashNet decrease in cash and cash equivalents and restricted cash(24,550)(334,996)
Cash and cash equivalents and restricted cash, at beginning of periodCash and cash equivalents and restricted cash, at beginning of period554,231 428,786 Cash and cash equivalents and restricted cash, at beginning of period365,910 554,231 
Cash and cash equivalents and restricted cash, at end of periodCash and cash equivalents and restricted cash, at end of period$310,673 $551,964 Cash and cash equivalents and restricted cash, at end of period$341,360 $219,235 
65


XENIA HOTELS & RESORTS, INC.
Condensed Consolidated Statements of Cash Flows, Continued
For the NineThree Months Ended September 30,March 31, 2023 and 2022 and 2021
(Unaudited)
(Dollar amounts in thousands)
Nine Months Ended September 30,Three Months Ended March 31,
2022202120232022
Supplemental disclosure of cash flow information:Supplemental disclosure of cash flow information:Supplemental disclosure of cash flow information:
The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the condensed consolidated balance sheets to the amount shown in the condensed consolidated statements of cash flows:The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the condensed consolidated balance sheets to the amount shown in the condensed consolidated statements of cash flows:The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the condensed consolidated balance sheets to the amount shown in the condensed consolidated statements of cash flows:
Cash and cash equivalentsCash and cash equivalents$259,885 $517,464 Cash and cash equivalents$283,154 $179,077 
Restricted cashRestricted cash50,788 34,500 Restricted cash58,206 40,158 
Total cash and cash equivalents and restricted cash shown in the condensed consolidated statements of cash flowsTotal cash and cash equivalents and restricted cash shown in the condensed consolidated statements of cash flows$310,673 $551,964 Total cash and cash equivalents and restricted cash shown in the condensed consolidated statements of cash flows$341,360 $219,235 
The following represent cash paid during the periods presented for the following:The following represent cash paid during the periods presented for the following:The following represent cash paid during the periods presented for the following:
Cash paid for interest, net of capitalized interestCash paid for interest, net of capitalized interest$59,898 $55,427 Cash paid for interest, net of capitalized interest$23,869 $21,433 
Cash paid for taxesCash paid for taxes2,100 163 Cash paid for taxes220 — 
Supplemental schedule of non-cash investing and financing activities:Supplemental schedule of non-cash investing and financing activities:Supplemental schedule of non-cash investing and financing activities:
Accrued capital expendituresAccrued capital expenditures$2,252 $206 Accrued capital expenditures$2,263 $2,891 
Distributions Payable11,660 — 
Distributions payableDistributions payable11,334 — 
See accompanying notes to the condensed consolidated financial statements.
76


XENIA HOTELS & RESORTS, INC.
Notes to the Condensed Consolidated Financial Statements (Unaudited)
September 30, 2022March 31, 2023

1. Organization
Xenia Hotels & Resorts, Inc. (the "Company" or "Xenia") is a Maryland corporation that invests in uniquely positioned luxury and upper upscale hotels and resorts with a focus on the top 25 lodging markets as well as key leisure destinations in the United States.
Substantially all of the Company's assets are held by, and all the operations are conducted through, XHR LP (the "Operating Partnership"). XHR GP, Inc. is the sole general partner of XHR LP and is wholly-owned by the Company. As of September 30, 2022,March 31, 2023, the Company collectively owned 97.1%95.9% of the common limited partnership units issued by the Operating Partnership ("Operating Partnership Units"). The remaining 2.9%4.1% of the Operating Partnership Units are owned by the other limited partners comprised of certain of our current executive officers and current and prior members of our Board of Directors and includes vested and unvested long-term incentive plan ("LTIP") partnership units. LTIP partnership units may or may not vest based on the passage of time and whether certain market-based performance objectives are met.
Xenia operates as a real estate investment trust ("REIT"). To qualify as a REIT, the Company cannot operate or manage its hotels. Therefore, the Operating Partnership and its subsidiaries lease the hotel properties to XHR Holding, Inc. and its subsidiaries (collectively with its subsidiaries, "XHR Holding"), the Company's taxable REIT subsidiary ("TRS"), which engages third-party eligible independent contractors to manage the hotels.
As of September 30,March 31, 2023 and 2022, and 2021, the Company owned 3432 and 3534 lodging properties, respectively.
Ongoing Recovery from COVID-19
The Company's hotel portfolio began to see improvements in leisure demand during the second half of 2020, a trend that accelerated in 2021 and has continued in 2022. During the first half of 2022, operations continued to improve including a continuation of strong leisure bookings, higher levels of business transient demand and improving group demand in certain markets. In the third quarter of 2022, while the Company experienced its typical seasonal decline in leisure demand it also saw a broader acceleration of business transient and group business particularly following the Labor Day holiday period.
Despite this improvement, there remains uncertainty regarding the pace of recovery and whether and when business travel and larger group meetings will return to pre-pandemic levels. As the recovery continues, we expect that the pace will vary from market to market and may be uneven in nature. Additionally, there has been increasing uncertainty regarding the broader economic environment as higher levels of inflation have persisted along with rising interest rates and increased concerns of a recession in the near term.
2. Summary of Significant Accounting Policies
The unaudited interim condensed consolidated financial statements and related notes have been prepared on an accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP" or "GAAP") and in conformity with the rules and regulations of the Securities and Exchange Commission ("SEC") applicable to financial information. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been omitted in accordance with the rules and regulations of the SEC. The unaudited condensed consolidated financial statements include normal recurring adjustments, which management considers necessary for the fair presentation of the condensed consolidated balance sheets, condensed consolidated statements of operations and comprehensive income (loss), condensed consolidated statements of changes in equity and condensed consolidated statements of cash flows for the periods presented. The unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto as of and for the year ended December 31, 2021,2022, included in the Company's Annual Report on Form 10-K filed with the SEC on March 1, 2022.2, 2023. Operating results for the three and nine months ended September 30, 2022March 31, 2023 are not necessarily indicative of actual operating results for the entire year.
Basis of Presentation
The condensed consolidated financial statements include the accounts of the Company, the Operating Partnership, and XHR Holding. The Company's subsidiaries generally consist of limited liability companies, limited partnerships and the TRS. The effects of all inter-company transactions have been eliminated.
8


Reclassifications
Certain prior year amounts in these condensed consolidated financial statements have been reclassified to conform to the presentation as of and for the three and nine months ended September 30, 2022.March 31, 2023.
Use of Estimates
The preparation of the condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities, and revenues and expenses. These estimates are prepared using management's best judgment, after considering past, current and expected future economic conditions. Actual results could differ from these estimates.
Risks and Uncertainties
As a result of the COVID-19 pandemic, the majority of the Company's hotels and resorts temporarily suspended operations for certain periods of time during 2020. All of the Company's hotels had resumed operations by the end of May 2021. The Company's portfolio consists of luxury and upper upscale hotels and resorts, which generally offer restaurant and bar venues, large meeting facilities and event space, and amenities, including spas and golf courses, some of which had limited operations due to operating restrictions and staffing challenges. The Company continues to monitor the evolving situation and guidance from federal, state and local governmental and public health authorities and additional actions may be taken or required based on their recommendations and regulations in place. Under these circumstances, there may be developments that require further adjustments to operations.
The Company cannot predict with certainty the full extent and duration of the effects of the COVID-19 pandemic on its business, operating margins, results of operations, cash flows, financial condition, the market price of its common stock, its ability to make distributions to its shareholders, its access to equity and credit markets or its ability to service its indebtedness. Further, the Company continues to monitor and evaluate the challenges associated with inflationary pressures, rising interest rates, a potential domestic and/or global recession, the evolving workforce landscape, particularly related to industry-wide labor shortages and increases in cost of labor, as well as ongoing supply chain issues which may continue to impact the hotels' ability to source operating supplies and other materials. Additionally, the effects of the pandemic or other economic challenges could materially and adversely affect the Company's ability to consummate acquisitions and dispositions of hotel properties in the near term.
For the ninethree months ended September 30, 2022,March 31, 2023, the Company had a geographical concentration of revenues generated from hotels in the Orlando, Florida, Phoenix, Arizona and San Diego, CaliforniaHouston, Texas markets that exceeded 10% of total revenues for the period then
7


ended. For the ninethree months ended September 30, 2021,March 31, 2022, the Company had a geographical concentration of revenues generated from hotels in the Orlando, Florida, and Phoenix, Arizona San Diego, California and Houston, Texas markets that exceeded 10% of total revenues for the period then ended. To the extent that there are adverse changes in these markets, or the industry sectors that operate in these markets, our business and operating results could be negatively impacted.
Consolidation
The Company evaluates its investments in partially owned entities to determine whether such entities may be a variable interest entity ("VIE") or voting interest entity. If the entity is a VIE, the determination of whether the Company is the primary beneficiary must be made. The primary beneficiary determination is based on a qualitative assessment as to whether the entity has (i) power to direct significant activities of the VIE and (ii) an obligation to absorb losses or the right to receive benefits that could be potentially significant to the VIE. The Company will consolidate a VIE if it is deemed to be the primary beneficiary. The equity method of accounting is applied to entities in which the Company is not the primary beneficiary, or the entity is not a VIE and over which the Company does not have effective control but can exercise influence over the entity with respect to its operations and major decisions.
The Operating Partnership is a VIE. The Company's significant asset is its investment in the Operating Partnership, as described in Note 1, and consequently, substantially all of the Company's assets and liabilities represent those assets and liabilities of the Operating Partnership.
Cash and Cash Equivalents
The Company considers all demand deposits, money market accounts and investments in certificates of deposit and repurchase agreements purchased, and similar accounts with a maturity of three months or less at the date of purchase, to be cash
9


equivalents. The Company maintains its cash and cash equivalents at various banks and other financial institutions. The combined account balances at one or morebanking institutions generally exceed the Federal Depository Insurance Corporation ("FDIC") insurance coverage and, as a result, there is a concentration of credit risk related to amounts on deposit in excess of FDIC insurance coverage. The Company believes that themonitors its concentration risk is not significantand reallocates funds among various institutions from time to time as the Company does not anticipate non-performance by the financial institutions.determined appropriate based on perceived risks.
Restricted Cash and Escrows
Restricted cash primarily relates to furniture, fixtures and equipment replacement reserves ("FF&E reserves") as required per the terms of the Company's management and franchise agreements, cash held in restricted escrows for real estate taxes and insurance, capital spending reserves and, at times, disposition-related holdback escrows.
Acquisition of Real Estate
Investments in hotel properties, including land and land improvements, buildings and building improvements, furniture, fixtures and equipment, and identifiable intangiblesintangible assets, will generally be accounted for as asset acquisitions. Acquired assets are recorded at their relative fair value based on total accumulated costs of the acquisition. Direct acquisition-related costs are capitalized as a component of the acquired assets. This includes all costs related to finding, analyzing and negotiating a transaction.
The allocation of the purchase price is an area that requires judgment and significant estimates. Tangible and intangible assets typically include land, buildings and improvements, furniture and fixtures, inventory, acquired above market and below market leases, in-place lease value, advance bookings, and any assumed financing that is determined to be above or below market terms (all as applicable). Acquisition-date fair values of assets and assumed liabilities are determined based on replacement costs, appraised values, and estimated fair values using methods similar to those used by independent appraisers and that use appropriate discount and/or capitalization rates and available market information.
Impairment
Long-lived assets and intangibles
The Company assesses the carrying values of the respective long-lived assets whenever events or changes in circumstances indicate that the carrying amounts of these assets may not be fully recoverable. Events or circumstances that may cause a review include, but are not limited to, when (1) a hotel property experiences a significant decrease in the market price of the long-lived asset, (2) a hotel property experiences a current or projected loss from operations combined with a history of
8


operating or cash flow losses, (3) it becomes more likely than not that a hotel property will be sold before the end of its useful life, (4) an accumulation of costs is significantly in excess of the amount originally expected for the acquisition, construction or renovation of a long-lived asset, (5) adverse changes in demand occur for lodging at a specific property due to declining national or local economic conditions and/or new hotel construction in markets where the hotel is located, (6) there is a significant adverse change in legal factors or in the business climate that could affect the value of the long-lived asset and/or (7) there is a significant adverse change in the extent or manner in which a long-lived asset is being used or in its physical condition. If it is determined that the carrying value is not recoverable because the undiscounted cash flows do not exceed carrying value, the Company records an impairment charge to the extent that the carrying value exceeds fair value.
In June 2021, the Company concluded that it intended to sell the 352-room Marriott Charleston Town Center, in Charleston, West Virginia and began marketing the property. As a result of multiple bids from qualified buyers and ongoing price discussions, management determined, based on a probability weighted-average undiscounted cash flow analysis, that the hotel was impaired as the estimated undiscounted cash flows were less than the carrying value of the hotel as of June 30, 2021. Management determined the impairment loss as the excess of carrying value over the estimated fair value. As a result, for the three and six months ended June 30, 2021, the Company recorded an impairment loss of approximately $12.3 million. In August 2021, the Company entered into an agreement to sell the property for a sale price of $5.0 million and the buyer funded an at-risk deposit. Upon meeting held for sale criteria, the Company recorded an additional impairment loss of $0.3 million for the three and nine months ended September 30, 2021 related to estimated closing costs.
Involuntary Conversion
In August 2021, Hurricane Ida impacted Loews New Orleans Hotel located in New Orleans, Louisiana. As a result, the Company recorded an impairment loss of $0.5 million forDuring the three and nine months ended September 30, 2021, which represents the write off of the estimated historical cost, net of accumulated depreciation, of property damaged during the
10


hurricane. Additionally, the Company expensed $1.0 million of hurricane-related repair and cleanup costs for the three and nine months ended September 30, 2021. In March 31, 2022, the Company recorded additional hurricane-related repair and cleanup costs of $1.3 million. These amounts aremillion which is included in impairment and other losses on the condensed consolidated statements of operations and comprehensive income (loss)loss for the three and nine months ended September 30, 2022 and 2021.period then ended.
Insurance Recoveries
Insurance proceeds received in excess of recognized losses are treated as gain and are not recorded until contingencies are resolved. During the three and nine months ended September 30,March 31, 2022, the Company recorded insurance proceeds related to damage sustained at Loews New Orleans Hotel during Hurricane Ida. These insurance proceeds were in excess of recognized losses and resulted in a gain on insurance recovery of $1.0 million and $3.6 million, respectively, for the three and nine months ended September 30, 2022, which areis included in other income (loss) on the condensed consolidated statements of operations and comprehensive income (loss) for the periods then ended.
The Company may also be entitled to business interruption proceeds for losses occurring at certain properties; however, an insurance recovery receivable will not be recorded until a final settlement has been reached with the insurance company. During the three and nine months ended September 30, 2022, the Company recognized $1.5 million in business interruption insurance proceeds for a portion of lost income associated with cancellations at Loews New Orleans Hotel due to the impact of Hurricane Ida in August 2021 as well as $1.0 million in proceeds for lost income associated with cancellations for properties in Texas due to the impact of the Texas winter storms in February 2021. During the nine months ended September 30, 2021, the Company recognized $1.1 million in business interruption insurance proceeds for a portion of lost revenues associated with cancellations related to the COVID-19 pandemic. These amounts are included in gain on business interruption insurance on the condensed consolidated statements of operations and comprehensive income (loss)loss for the period then ended.
Investment Properties Held for Sale
In determining whether to classify an investment property as held for sale, the Company considers whether: (i) management has committed to a plan to sell the investment property; (ii) the investment property is available for immediate sale, in its present condition; (iii) the Company is actively marketing the investment property for sale at a price that is reasonable in relation to its fair value; (iv) the Company has initiated a program to locate a buyer; (v) the Company believes that the sale of the investment property is probable; (vi) the Company has received a significant non-refundable deposit for the purchase of the property; and (vii) actions required for the Company to complete the plan indicate that it is unlikely that any significant changes will be made to the plan.
If all of the above criteria are met, the Company classifies the investment property as held for sale. On the day that these criteria are met, the Company suspends depreciation and amortization on the investment properties held for sale. The investment properties, other assets and liabilities associated with those investment properties that are held for sale are classified separately on the consolidated balance sheet for the most recent reporting period, and are presented at the lesser of the carrying value or fair value, less costs to sell.
Additionally, if the sale constitutes a strategic shift with a major effect on operations, as defined in ASU 2014-08 Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity ("ASU 2014-08"), the operations for the investment properties held for sale are classified on the consolidated statement of operations and comprehensive income (loss) as discontinued operations for all periods presented.
Disposition of Real Estate
The Company accounts for dispositions of real estate in accordance with ASUAccounting Standards Update ("ASU") 2017-05, Other Income - Gains and Losses from the Derecognition of Nonfinancial Assets ("Subtopic 610-20") for the transactions between the Company and unrelated third-parties that are not considered a customer in the ordinary course of business. Typically, the real estate assets disposed of do not represent the transfer of a business or contain a material amount of financial assets, if any. The real estate assets promised in a sales contract are typically nonfinancial assets (i.e. land or a leasehold interest in land, buildings, furniture, fixtures and equipment) or in substance nonfinancial assets. The Company recognizes a gain or loss in full when the real estate is sold, provided (a) there is a valid contract and (b) transfer of control has occurred.
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Revenues
Revenues consist of amounts derived from hotel operations, including the sale of rooms for lodging accommodations, food and beverage, and other ancillary revenue generated by hotel amenities including spa, parking, golf, resort fees and other services.
Revenues are generated from various distribution channels including but not limited to direct bookings, global distribution systems and Internet travel sites. Room transaction prices are based on an individual hotel's location, room type and the bundle of services included in the reservation and are set by the hotel daily. Any discounts, including advanceadvanced purchase, loyalty point redemptions or promotions are recognized at the discounted rate whereas rebates and incentives are recorded as a reduction in rooms revenues when earned. Revenues from online channels are generally recognized net of commission fees, unless the end price paid by the guest is known. Rooms revenue is recognized over the length of stay that the hotel room is occupied by the guest. Cash received from a guest prior to check-in is recorded as an advance deposit and is generally recognized as rooms revenue at the time the room reservation has become non-cancellable, upon occupancy or upon expiration of the re-booking date. Advance deposits are included in other liabilities on the condensed consolidated balance sheets. Payment of any remaining balance is typically due from the guest upon check-out. Sales, use, occupancy, and similar taxes are collected and presented on a net basis (excluded from revenues).
Food and beverage transaction prices are based on the stated price for the specific food or beverage and varies depending on type, venue and hotel location. Service charges are typically a percentage of food and beverage prices and meeting space rental. Food and beverage revenue is recognized at the point in time in which the goods and/or services are rendered to the guest. Cash received in advance of an event is recorded as either a security or advance deposit. Security and advance deposits are recognized as revenue when it becomes non-cancellable or at the time the food and beverage goods and services are rendered to the guest. Payment for the remaining balance of food and beverage goods and services is due upon delivery and completion of such goods and services.
9


Parking and audio visual fees are recognized at the time services are provided to the guest at the stated price for the service or goods.guest. In parking and audio visual contracts in which the Company haswe have control over the services provided, the Company iswe are considered the principal in the agreement and recognizesrecognize the related revenues gross of associated costs. If the Company doeswe do not have control over the services in the contract, the Company iswe are considered the agent and recordsrecord the related revenues net of associated costs.
Resort and amenity fees, spa, golf and other ancillary amenity revenues are recognized at the point in time the goods or services have been rendered to the guest at the stated price for the service or amenity.
Share-Based Compensation
The Company maintains a share-based incentive plan that provides for the grant of stock options, stock awards, restricted stock units, LTIP units and other equity-based awards. Share-based compensation is measured at the estimated fair value of the award on the date of grant, adjusted for forfeitures as they occur, and recognized as an expense on a straight-line basis over the longest vesting period for each grant for the entire award. The determination of fair value of these awards is subjective and involves significant estimates and assumptions including expected volatility of the Company's share price, expected dividend yield, expected term and assumptions of whether certain of these awards will achieve performance thresholds. Share-based compensation is included in general and administrative expenses in the condensed consolidated statements of operations and comprehensive income (loss) and capitalized in buildings and other improvements in the condensed consolidated balance sheets for certain employees that manage property developments, renovations and capital improvements.
12
Deferred Financing Costs
Financing costs related to the Revolving Line of Credit and long-term debt are recorded at cost and are amortized as interest expense on a straight-line basis, which approximates the effective interest method, over the life of the related debt instrument unless there is a significant modification to the debt instrument. Financing costs related to the Senior Notes are amortized using the effective interest method. The balance of unamortized deferred financing costs related to the Revolving Line of Credit is included in other assets and unamortized deferred financing costs related to all other debt are presented as a reduction in debt, net of loan premiums, discounts and unamortized deferred financing costs on the condensed consolidated balance sheets.

At March 31, 2023 and December 31, 2022, deferred financing costs related to the Revolving Line of Credit and the revolving credit facility that was refinanced in January 2023 were $9.6 million and $7.8 million, offset by accumulated amortization of $4.7 million and $6.4 million, respectively. At March 31, 2023 and December 31, 2022, deferred financing costs related to all other debt were $25.0 million and $26.3 million, offset by accumulated amortization of $9.5 million and $10.5 million, respectively.

3. Revenues
The following represents total revenues disaggregated by primary geographical markets (as defined by STR, Inc. ("STR")) for the three and nine months ended September 30,March 31, 2023 and 2022 and 2021 (in thousands):
Three Months EndedNine Months Ended
Primary MarketsSeptember 30, 2022September 30, 2022
Orlando, FL$26,635 $99,780 
Phoenix, AZ17,382 78,974 
San Diego, CA28,937 74,998 
Houston, TX17,442 62,517 
Dallas, TX14,311 45,714 
Atlanta, GA15,636 42,333 
Denver, CO14,180 37,184 
San Francisco/San Mateo, CA13,369 35,658 
Washington, DC-MD-VA11,348 32,388 
Nashville, TN13,573 30,424 
Other67,855 194,496 
Total$240,668 $734,466 
Three Months Ended
Primary MarketsMarch 31, 2023
Orlando, FL$40,408 
Phoenix, AZ37,473 
Houston, TX27,459 
San Diego, CA21,975 
Dallas, TX19,950 
Atlanta, GA15,501 
San Francisco/San Mateo, CA13,378 
Nashville, TN10,967 
Washington, DC-MD-VA10,907 
Portland, OR10,579 
Other60,376 
Total$268,973 
Three Months EndedNine Months Ended
Primary MarketsSeptember 30, 2021September 30, 2021
Orlando, FL$19,269 $52,231 
Phoenix, AZ12,901 45,327 
San Diego, CA23,073 42,947 
Houston, TX15,117 42,639 
Denver, CO11,762 26,902 
Atlanta, GA10,868 24,861 
Dallas, TX9,284 20,726 
Florida Keys5,202 18,339 
Washington, DC-MD-VA7,672 17,081 
Savannah, GA5,832 15,525 
Other51,804 106,032 
Total$172,784 $412,610 
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Three Months Ended
Primary MarketsMarch 31, 2022
Orlando, FL$36,207 
Phoenix, AZ30,707 
Houston, TX20,996 
San Diego, CA19,188 
Dallas, TX12,846 
Atlanta, GA10,965 
San Francisco/San Mateo, CA9,578 
Florida Keys9,365 
Denver, CO9,052 
Washington, DC-MD-VA7,461 
Other43,982 
Total$210,347 
4. Investment Properties
From time to time, the Company evaluates acquisition opportunities based on our investment criteria and/or the opportunistic disposition of our hotels in order to take advantage of market conditions or in situations where the hotels no longer fit within our strategic objectives.
Acquisitions
OnIn March 29, 2022, the Company acquired a fee-simple interest in the 346-room W Nashville located in Nashville, Tennessee for a purchase price of $328.5 million including acquisition costs and a $1.3 million credit related to an unfinished portion of the hotel provided by seller at closing.
The acquisition of W Nashville was funded with cash on hand and was accounted for as an asset acquisition resulting in the related acquisition costs being capitalized as part of the purchase price. The results of operations for W Nashville have been
13


included in the Company’s condensed consolidated statements of operations and comprehensive income (loss) since its acquisition date.
The Company recorded the identifiable assets and liabilities, including intangible assets and liabilities, acquired in the asset acquisition at the acquisition date relative fair value, which is based on the total accumulated costs of the acquisition. The following represents the purchase price allocation of the hotel acquired during the ninethree months ended September 30,March 31, 2022 (in thousands):
September 30,March 31, 2022
Land$36,364 
Buildings and improvements264,766 
Furniture, fixtures, and equipment31,091 
Intangible and other assets(1)
232 
Intangible liability(2)
(3,960)
Total purchase price(3)
$328,493 
(1)As part of the purchase price allocation for W Nashville, the Company allocated $0.1 million to advance bookings that will be amortized over 1.3 years as well as $0.1 million allocated to food inventory.
(2)As part of the purchase price allocation for W Nashville, the Company allocated $4.0 million to a liability associated with key money received by the seller from the third-party hotel manager. This liability will be amortized over 29.8 years and in the event of early termination is payable to the third-party hotel manager on a pro rata basis for the remaining portion of the term of the hotel management agreement.
(3)The total cost capitalized includes acquisition costs as the transaction was accounted for as an asset acquisition.
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Dispositions
In November 2021, the Company entered into an agreement to sell the 191-room Kimpton Hotel Monaco Chicago in Chicago, Illinois for a sale price of $36.0 million. The sale closed in January 2022 and did not result in a gain or loss after previously recording an impairment of $15.7 million during the year ended December 31, 2021. Proceeds from the sale were used for general corporate purposes.
The operating results of the hotel that was sold during the nine months ended September 30, 2022 are included in the Company's condensed consolidated financial statements as part of continuing operations as the disposition did not represent a strategic shift nor did it have a major impact on the Company's results of operations.
Held for Sale
In August 2022, the Company entered into an agreement to sell the 115-room Bohemian Hotel Celebration, Autograph Collection, in Celebration, Florida for a sale price of approximately $27.8 million and the buyer funded an at-risk deposit. The sale closed on October 20, 2022 for an estimated gain of approximately $12.6 million. Net cash proceeds from the sale, after transaction closing costs, were $25.5$32.8 million. The Company also retained the approximately $0.3 million balance in the FF&E reserve. As of September 30, 2022, the hotel's assets and liabilities were classified as held for sale on the condensed consolidated balance sheet for the period then ended.
In September 2022, the Company entered into an agreement to sell the 189-room Kimpton Hotel Monaco Denver in Denver, Colorado for a sale price of approximately $69.8 million. The buyer funded an at-risk deposit and the sale is subject to customary closing conditions and certain third-party approvals. The sale is expected to close in the fourth quarter of 2022. As of September 30, 2022, the hotel's assets and liabilities were classified as held for sale on the condensed consolidated balance sheet for the period then ended.
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The following represents the major classes of assets and liabilities associated with assets held for sale as of September 30, 2022 (in thousands):
September 30, 2022
Land$6,975 
Buildings and other improvements102,463 
     Total$109,438 
Less: accumulated depreciation(41,463)
     Net investment properties$67,975 
Accounts and rents receivable, net of allowance for doubtful accounts368 
Other assets596 
     Total assets held for sale$68,939 
Accounts payable and accrued expenses2,766 
Other liabilities766 
     Total liabilities associated with assets held for sale$3,532 
The operating results of the two hotels that were held for sale as of September 30, 2022 are included in the Company's condensed consolidated statements of operations and comprehensive income (loss) for the three and nine months ended September 30, 2022 and 2021, respectively.
5. Debt
Debt as of September 30, 2022March 31, 2023 and December 31, 20212022 consisted of the following (dollar amounts in thousands):
Balance Outstanding as ofBalance Outstanding as of
Rate Type
Rate(1)
Maturity DateSeptember 30, 2022December 31, 2021Rate Type
Rate(1)
Maturity DateMarch 31, 2023December 31, 2022
Mortgage LoansMortgage LoansMortgage Loans
Renaissance Atlanta Waverly Hotel & Convention CenterRenaissance Atlanta Waverly Hotel & Convention Center
Fixed (2)
4.45 %8/14/2024$100,000 $100,000 Renaissance Atlanta Waverly Hotel & Convention Center
Fixed (2)
— %8/14/2024$— $99,590 
Andaz Napa
Partially
Fixed (3)
4.43 %9/13/202454,830 55,640 
The Ritz-Carlton, Pentagon City
Fixed (4)
— %— 65,000 
Grand Bohemian Hotel Orlando, Autograph CollectionGrand Bohemian Hotel Orlando, Autograph CollectionFixed4.53 %3/1/202655,967 56,796 Grand Bohemian Hotel Orlando, Autograph CollectionFixed4.53 %3/1/202655,399 55,685 
Marriott San Francisco Airport WaterfrontMarriott San Francisco Airport WaterfrontFixed4.63 %5/1/2027110,649 112,102 Marriott San Francisco Airport WaterfrontFixed4.63 %5/1/2027109,651 110,153 
Andaz NapaAndaz Napa
Variable (3)
7.34 %1/19/202855,000 54,560 
Total Mortgage LoansTotal Mortgage Loans4.52 %(5)$321,446 $389,538 Total Mortgage Loans5.28 %(4)$220,050 $319,988 
Corporate Credit FacilitiesCorporate Credit FacilitiesCorporate Credit Facilities
Corporate Credit Facility Term Loan $125MCorporate Credit Facility Term Loan $125M
Variable (6)
4.47 %9/13/2024125,000 125,000 Corporate Credit Facility Term Loan $125M
Variable (5)
— %9/13/2024— 125,000 
2023 Initial Term Loan2023 Initial Term Loan
Variable (5)
6.59 %3/1/2026125,000 — 
2023 Delayed Draw Term Loan2023 Delayed Draw Term Loan
Variable (5)
6.59 %3/1/2026100,000 — 
Revolving Credit FacilityRevolving Credit Facility
Variable (7)
5.37 %2/28/2024— — Revolving Credit Facility
Variable (6)
— %2/28/2024— — 
Revolving Line of Credit (2023)Revolving Line of Credit (2023)
Variable (6)
6.59 %1/11/2027— — 
Total Corporate Credit FacilitiesTotal Corporate Credit Facilities$125,000 $125,000 Total Corporate Credit Facilities$225,000 $125,000 
2020 Senior Notes $500M2020 Senior Notes $500MFixed6.38 %8/15/2025500,000 500,000 2020 Senior Notes $500MFixed6.38 %8/15/2025500,000 500,000 
2021 Senior Notes $500M2021 Senior Notes $500MFixed4.88 %6/1/2029500,000 500,000 2021 Senior Notes $500MFixed4.88 %6/1/2029500,000 500,000 
Loan premiums, discounts and unamortized deferred financing costs, net (8)
(16,928)(20,307)
Loan premiums, discounts and unamortized deferred financing costs, net (7)
Loan premiums, discounts and unamortized deferred financing costs, net (7)
(15,534)(15,883)
Total Debt, net of loan premiums, discounts and unamortized deferred financing costsTotal Debt, net of loan premiums, discounts and unamortized deferred financing costs5.28 %(5)$1,429,518 $1,494,231 Total Debt, net of loan premiums, discounts and unamortized deferred financing costs5.72 %(4)$1,429,516 $1,429,105 
(1)The rates shown represent the annual interest rates as of September 30, 2022. The variable index for the Renaissance Atlanta Waverly Hotel & Convention Center mortgage loan is daily SOFR and for the Andaz Napa mortgage loan is one-month LIBOR.March 31, 2023. The variable index for the corporate credit facilities reflectsis Term SOFR, subject to a 2510 basis point LIBORcredit spread adjustment and a zero basis point floor, which is applicable for the value of all corporate credit facilities not subject to an interest rate hedge.as further described below under "Corporate Credit Facilities."
(2)A variable interest rate loan for which the interest rate has been fixed through October 2022, after which the rate reverts to variable.
(3)A variable interest loan for which the interest rate has been fixed on $25 million of the balance through October 2022, after which the rate reverts to variable.
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(4)A variable interest rate loan for which the interest rate was fixed through January 2023. The outstanding balance of thisThis mortgage loan was repaid in full in January 2022 and the two interest rate swaps associated with this loan were terminated in connection with the repayment.2023.
(5)(3)In January 2023, the Company amended this mortgage loan to update the variable index from one-month LIBOR to Term SOFR, increased the credit spread, increase the principal amount to $55 million and extend the maturity date through January 2028.
(4)Represents the weighted-average interest rate as of September 30, 2022.March 31, 2023.
(6)(5)TheIn January 2023, the existing corporate credit facility term loan was refinanced with a new $125 million initial term loan and, effective as of January 10, 2023, the spread to LIBOR may vary, as it is determined by the Company's leverage ratio. The applicable interest rate was set to the highest level of grid-based pricing during the covenant waiver period, however, with the delivery of the compliance certificates under the corporate credit facilitiesTerm SOFR for the fiscal quarter ending June 30, 2022, the Company exited the covenant waiver period and the applicable interest rate has reverted to pricingsuch term loan varies based on the Company's leverage ratio.
(7)Commitmentsratio as further described under the revolving credit facility totaled $523"Corporate Credit Facilities". On January 17, 2023, an additional $100 million through February 2022, after whichdelayed draw term loan was borrowed and, effective as of such date, the total commitments decreased to $450 million through maturity in February 2024. The spread to LIBOR may vary, as it is determined by the Company's leverage ratio. The applicable interest rate was set to the highest level of grid-based pricing during the covenant waiver period, however, with the delivery of the compliance certificates under the corporate credit facilitiesTerm SOFR for the fiscal quarter ending June 30, 2022, the Company exited the covenant waiver period and the applicable interest rate has reverted to pricingsuch term loan varies based on the Company's leverage ratio.ratio as further described below under "Corporate Credit Facilities".
(8)(6)The existing revolving credit facility was refinanced with a new $450 million Revolving Line of Credit in January 2023 and, effective as of January 10, 2023, the spread to Term SOFR varies based on the Company’s leverage ratio, as further described below under “Corporate Credit Facilities.”
(7)Includes loan premiums, discounts and deferred financing costs, net of accumulated amortization.
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Mortgage Loans
In January 2023, the Company repaid in full the $99.5 million outstanding balance on the mortgage loan collateralized by Renaissance Atlanta Waverly Hotel & Convention Center using proceeds from the 2023 Delayed Draw Term Loan. Also in January 2023, the Company amended the mortgage loan collateralized by Andaz Napa to update the variable index from one-month LIBOR to Term SOFR, increase the credit spread, increase the principal amount to $55 million and extend the maturity date through January 2028.
Of the total outstanding debt at September 30, 2022,March 31, 2023, none of the mortgage loans were recourse to the Company. As of September 30, 2022, the Company was not in compliance with its debt covenants on one mortgage loan which did not result in an event of default but allows the lender the option to institute a cash sweep until covenant compliance is achieved for a period of time specified in the loan agreement. The cash sweep permits the lender to withdraw excess cash generated by the property into a separate bank account that they control, which may be used to reduce the outstanding loan balance. The mortgage loan agreements require contributions to be made to FF&E reserves. In addition, certain quarterly financial covenants have been waived for a period of time specified in the respective amended loan agreements and certain financial covenants have been adjusted following the waiver periods.
Corporate Credit Facilities
In January 2022,2023, XHR LP (the "Borrower") entered into a new $675 million senior unsecured credit facility comprised of a $450 million revolving line of credit (the “Revolving Line of Credit”), a $125 million initial term loan (the "2023 Initial Term Loan) and a $100 million delayed draw term loan (the “2023 Delayed Draw Term Loan” and, together with the Company repaid2023 Initial Term Loan, the "2023 Term Loans") pursuant to a Revolving Credit and Term Loan Agreement, dated as of January 10, 2023, by and among the Borrower, JPMorgan Chase Bank, N.A., as administrative agent, and the lenders and other parties party thereto (the “2023 Credit Agreement”). The Revolving Line of Credit and the 2023 Initial Term Loan refinanced in full the $65.0 millionexisting corporate credit facilities outstanding balanceunder the prior credit agreement, and as a result of such refinancing, the existing pledges of equity of certain subsidiaries securing obligations under the Company's prior credit facilities were released. The 2023 Delayed Draw Term Loan was funded on January 17, 2023 and was used to repay in full the mortgage loan collateralized by Renaissance Atlanta Waverly Hotel & Convention Center that was due August 2024. Proceeds from future Revolving Line of Credit borrowings may be used for working capital, general corporate or other purposes permitted by the 2023 Credit Agreement. The Ritz-Carlton, Pentagon City.
CorporateRevolving Line of Credit Facilities
Certain financial covenants relatedmatures in January 2027 and can be extended up to an additional year. The interest rate on the Company's amended corporateRevolving Line of Credit and the 2023 Term Loans is based on a pricing grid with a range of 145 to 275 basis points over the applicable Term SOFR rate as determined by the Company’s leverage ratio, subject to a 10 basis point credit facilities were suspended until the date that the compliance certificates demonstrating compliancespread adjustment and a zero basis point floor. The 2023 Term Loans mature in March 2026, can be extended up to an additional year and bear interest rates consistent with the financial covenants thereunder forpricing grid on the fiscal quarter ending June 30, 2022 were delivered (such period, the "covenant waiver period"). Certain financial covenants that were suspended during the covenant waiver period resumed quarterly testing beginning with the fiscal quarter ending June 30, 2022 but remain at modified covenant levels through the second quarter in 2023 (such period, unless earlier terminated by the Operating Partnership in accordance with the termsRevolving Line of the amended corporate credit facilities, the "permitted variations"). In addition, the amended corporate credit facilities had certain restrictions and covenants which were applicable during the covenant waiver period, including (i) mandatory prepayment requirements, (ii) affirmative covenants related to the pledge of equity of certain subsidiaries and (iii) negative covenants restricting certain acquisitions, investments, capital expenditures, ground leases and distributions. A minimum liquidity covenant also applied during the covenant waiver period.
The Company determined that it met the modified financial covenants for the quarter ended June 30, 2022 and delivered the compliance certificates demonstrating such compliance under the amended corporate credit facilities and, as a result, is no longer subject to the additional restrictions and covenants that applied during the covenant waiver period, other than in respect of certain restrictions and covenants related to the pledge of equity of certain subsidiaries which remain applicable until after the end of the permitted variations period.Credit.
As of September 30, 2022,March 31, 2023, there was no outstanding balance on the revolving credit facility.Revolving Line of Credit. During the three and nine months ended September 30, 2022,March 31, 2023, the Company incurred unused commitment fees of approximately $0.3 million and $1.1 million, respectively, and did not incur interest expense. During the three and nine months ended September 30, 2021,March 31, 2022, the Company incurred unused commitment fees of approximately $0.4 million and $1.0 million, respectively, anddid not incur interest expense of $1.9 million for the nine months ended September 30, 2021.expense.
Senior Notes
The indentures governing the Senior Notes contain customary covenants that limit the Operating Partnership's ability and, in certain circumstances, the ability of its subsidiaries, to borrow money, create liens on assets, make distributions and pay dividends, redeem or repurchase stock, make certain types of investments, sell stock in certain subsidiaries, enter into
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agreements that restrict dividends or other payments from subsidiaries, enter into transactions with affiliates, issue guarantees of indebtedness and sell assets or merge with other companies. These limitations are subject to a number of important exceptions and qualifications set forth in the indentures. In connection with the entry into the 2023 Credit Agreement and the refinancing of the obligations under the prior corporate credit facilities, the collateral securing the Senior Notes was released in full. On and after January 10, 2023, the Senior Notes constitute unsecured obligations.
Financial Covenants
As of March 31, 2023, the Company was in compliance with all debt covenants, current on all loan payments and not otherwise in default under the mortgage loans, the 2023 Credit Agreement or the Senior Notes.
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Debt Outstanding
Total debt outstanding as of September 30, 2022March 31, 2023 and December 31, 20212022 was $1,446$1,445 million and $1,515 million, respectively, and had a weighted-average interest rate of 5.28%5.72% and 5.18%5.65% per annum, respectively. The following table shows scheduled principal payments and debt maturities for the next five years and thereafter (in thousands):
As of
September 30, 2022
Weighted- 
Average
Interest Rate
As of
March 31, 2023
Weighted- 
Average
Interest Rate
2022$1,356 4.65%
202320235,537 4.65%2023$2,417 4.59%
20242024280,275 4.45%20243,355 4.59%
20252025503,512 6.36%2025504,284 6.36%
2026202654,380 4.53%2026280,071 6.19%
20272027102,053 4.65%
ThereafterThereafter601,386 4.83%Thereafter552,870 5.11%
Total DebtTotal Debt$1,446,446 5.28%Total Debt$1,445,050 5.72%
Revolving Credit Facility (matures in 2024)— 5.37%
Revolving Line of Credit (matures in 2027)Revolving Line of Credit (matures in 2027)— 6.59%
Loan premiums, discounts and unamortized deferred financing costs, netLoan premiums, discounts and unamortized deferred financing costs, net(16,928)Loan premiums, discounts and unamortized deferred financing costs, net(15,534)
Debt, net of loan premiums, discounts and unamortized deferred financing costsDebt, net of loan premiums, discounts and unamortized deferred financing costs$1,429,518 5.28%Debt, net of loan premiums, discounts and unamortized deferred financing costs$1,429,516 5.72%
InDuring the three months ended March 31, 2023, in connection with the 2023 Credit Agreement and amended mortgage loan, the Company capitalized $5.6 million of deferred financing costs and expensed $1.5 million of legal fees which were included in other income (loss) on the condensed consolidated statement of operations and comprehensive income for the period then ended.
During the three months ended March 31, 2023, in connection with refinancing of the existing revolving credit facility, the repayment of the existing corporate credit facility term loan and the repayment of one mortgage loan, during the nine months ended September 30, 2022, the Company wrote off the related unamortized deferred financing costs of $0.3$1.1 million, which is included in loss on extinguishment of debt on the condensed consolidated statements of operations and comprehensive income (loss) for the period then ended.
6. Derivatives
The Company primarily uses interest rate swaps as part of its interest rate risk management strategy for variable rate debt. As of September 30, 2022, all interest rate swaps were designated as cash flow hedges and involve the receipt of variable rate payments from a counterparty in exchange for making fixed rate payments over the life of the agreements without exchange of the underlying notional amount. Unrealized gains and losses of hedging instruments are reported in other comprehensive income or loss on the condensed consolidated statements of operations and comprehensive income (loss). Amounts reported in accumulated other comprehensive income (loss) related to currently outstanding derivatives are recognized as an adjustment to income or loss through interest expense as interest payments are made on the Company’s variable rate debt. During the nine months ended September 30, 2022, the Company terminated two interest rate swaps prior to their maturity and incurred swap termination costs of $1.6 million which is included in other income (loss) on the condensed consolidated statements of operations and comprehensive income (loss) for the period then ended.
Derivative instruments held by the Company with the right of offset in a net asset position were included in other assets on the condensed consolidated balance sheets.
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The following table summarizes the terms of the derivative financial instruments held by the Company as of September 30, 2022 and December 31, 2021, respectively (in thousands):
September 30, 2022December 31, 2021
Hedged DebtTypeFixed RateIndexEffective DateMaturityNotional AmountsEstimated Fair ValueNotional AmountsEstimated Fair Value
Mortgage DebtSwap1.83%1-Month LIBOR1/15/201610/22/2022$50,000 $39 $50,000 $(591)
Mortgage DebtSwap1.83%1-Month LIBOR1/15/201610/22/202225,000 20 25,000 (295)
Mortgage DebtSwap1.84%1-Month LIBOR1/15/201610/22/202225,000 19 25,000 (297)
Mortgage DebtSwap1.83%1-Month LIBOR1/15/201610/22/202225,000 20 25,000 (296)
$125M Term LoanSwap1.91%1-Month LIBOR10/13/20179/13/2022— — 40,000 (445)
$125M Term LoanSwap1.92%1-Month LIBOR10/13/20179/13/2022— — 40,000 (446)
$125M Term LoanSwap1.92%1-Month LIBOR10/13/20179/13/2022— — 25,000 (279)
$125M Term LoanSwap1.92%1-Month LIBOR10/13/20179/13/2022— — 20,000 (223)
Mortgage Debt(1)
Swap2.80%1-Month LIBOR6/1/20182/1/2023— — 24,000 (598)
Mortgage Debt(1)
Swap2.89%1-Month LIBOR1/17/20192/1/2023— — 41,000 (1,061)
$125,000 $98 $315,000 $(4,531)
(1)The Company terminated two interest rate swaps prior to maturity in connection with the repayment of the mortgage loan collateralized by The Ritz-Carlton, Pentagon City in January 2022.
The table below details the location in the condensed consolidated financial statements of the gains and losses recognized on derivative financial instruments designated as cash flow hedges for the three and nine months ended September 30, 2022 and 2021 (in thousands):
Three Months Ended September 30,Nine Months Ended September 30,
2022202120222021
Effect of derivative instruments:Location in Statements of Operations and Comprehensive
Income (Loss):
Gain (loss) recognized in other comprehensive income (loss)Unrealized gain (loss) on interest rate derivative instruments$36 $(163)$2,932 $2,389 
(Loss) gain reclassified from accumulated other comprehensive income (loss) to net income (loss)Reclassification adjustment for amounts recognized in net income (loss) (interest expense)$(147)$1,598 $1,697 $5,999 
Total interest expense in which effects of cash flow hedges are recordedInterest expense$20,583 $21,358 $61,474 $59,799 
Realized loss on termination of derivative instrumentsOther income (loss)$— $— $(1,555)$(2,779)
The Company expects approximately $0.1 million will be reclassified from accumulated other comprehensive income (loss) as a reduction to interest expense in the next 12 months.
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7. Fair Value Measurements
The Company defines fair value based on the price that would be received upon sale of an asset or the exit price that would be paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company uses a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value. The fair value hierarchy consists of three broad levels, which are described below:
Level 1 - Quoted prices for identical assets or liabilities in active markets that the entity has the ability to access.

Level 2 - Observable inputs, other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.

The Company has estimated the fair value of its financial and non-financial instruments using available market information and valuation methodologies it believes to be appropriate for these purposes. Considerable judgment and a high degree of subjectivity are involved in developing these estimates and, accordingly, they are not necessarily indicative of amounts that would be realized upon disposition.
For assets and liabilities measured at fair value on a recurring basis and non-recurring basis, quantitative disclosure of their fair values is included in the condensed consolidated balance sheets as of as of September 30, 2022 and December 31, 2021 (in thousands):
Fair Value Measurement Date
September 30, 2022December 31, 2021
Location on Condensed Consolidated Balance Sheets/Description of InstrumentObservable Inputs
 (Level 2)
Significant Unobservable Inputs
 (Level 3)
Observable Inputs
(Level 2)
Significant Unobservable Inputs
 (Level 3)
Recurring measurements
Other assets
Interest rate swaps(1)
$98 $— $— $— 
Other liabilities
Interest rate swaps(1)
$— $— $(4,531)$— 
Non-recurring measurements
Net investment properties
Kimpton Hotel Monaco Chicago$— $— $34,093 $— 
(1) Interest rate swap fair values are netted as applicable per the terms of the respective master netting agreements.
Recurring Measurements
The fair value of each derivative instrument is based on a discounted cash flow analysis of the expected cash flows under each arrangement. This analysis reflects the contractual terms of the derivative instrument, including the period to maturity, and utilizes observable market-based inputs, including interest rate curves and implied volatilities, which are classified within Level 2 of the fair value hierarchy. The Company also incorporates credit value adjustments to appropriately reflect each parties’ nonperformance risk in the fair value measurement, which utilizes Level 3 inputs such as estimates of current credit spreads. However, the Company has assessed that the credit valuation adjustments are not significant to the overall valuation of the derivatives and, as a result, its derivative valuations in their entirety are classified within Level 2 of the fair value hierarchy.
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Non-Recurring Measurements
Investment Properties
In November 2021, the Company entered into an agreement to sell the 191-room Kimpton Hotel Monaco Chicago for $36.0 million. Management estimated the future undiscounted cash flows for the scenario of a shortened hold period and for holding the asset long-term. Based on the results of the probability weighted-average undiscounted cash flow analysis, management determined the hotel was impaired as the estimated undiscounted cash flows were less than the carrying value of the hotel as of December 31, 2021. Management determined the impairment loss as the difference between the carrying value and the estimated fair value. The fair value was estimated using Level 2 assumptions, including values from market participants. As a result, for the year ended December 31, 2021, the Company recorded an impairment loss of $15.7 million, which is included in impairment and other losses on the consolidated statement of operations and comprehensive income (loss) for the period then ended. The sale closed in January 2022.
In June 2021, the Company concluded that it intended to sell the 352-room Marriott Charleston Town Center, in Charleston West Virginia and began marketing the property. Based on multiple bids from qualified buyers and ongoing price discussions, the Company expected the hotel to be sold for a price that was less than its net book value. As a result, for the three and six months ended June 30, 2021, the Company recorded an impairment loss of approximately $12.3 million. The Company subsequently recorded an additional impairment loss of $0.3 million for the three and nine months ended September 30, 2021 related to estimated closing costs. These impairment losses are included in impairment and other losses on the condensed consolidated statements of operations and comprehensive income (loss) for the periods then ended. The sale closed in November 2021.
Financial Instruments Not Measured at Fair Value
The table below represents the fair value of financial instruments presented at carrying values in the condensed consolidated balance sheets as of September 30, 2022March 31, 2023 and December 31, 20212022 (in thousands):
September 30, 2022December 31, 2021March 31, 2023December 31, 2022
Carrying
Value
Estimated
Fair Value
Carrying
Value
Estimated
Fair Value
Carrying
Value
Estimated
Fair Value
Carrying
Value
Estimated
Fair Value
Total Mortgage and Corporate Credit Facility Term Loan$446,446 $423,247 $514,538 $503,265 
Total Mortgage and Term LoansTotal Mortgage and Term Loans$445,050 $434,173 $444,988 $429,035 
Senior NotesSenior Notes1,000,000 904,698 1,000,000 1,055,323 Senior Notes1,000,000 930,323 1,000,000 912,823 
Revolving Credit FacilityRevolving Credit Facility— — — — Revolving Credit Facility— — — — 
Revolving Line of Credit (2023)Revolving Line of Credit (2023)— — — — 
TotalTotal$1,446,446 $1,327,945 $1,514,538 $1,558,588 Total$1,445,050 $1,364,496 $1,444,988 $1,341,858 
The Company estimated the fair value of its total debt, net of discounts, using a weighted-average effective interest rate of 6.19%5.80% and 5.23%6.24% per annum as of September 30, 2022March 31, 2023 and December 31, 2021,2022, respectively. The assumptions reflect the terms currently available to borrowers with credit profiles similar to the Company's. The Company has determined that its debt instrument valuations are classified in Level 2 of the fair value hierarchy.
8.7. Income Taxes
The Company estimated the TRS income tax expense for the three and nine months ended September 30,March 31, 2023 using an estimated federal and state combined effective tax rate of 31.04% and recognized an income tax expense of $5.2 million.
The Company estimated the income tax expense for the three months ended March 31, 2022 using an estimated federal and state combined effective tax rate of 14.57% and recognized an income tax benefit of $1.0 million and income tax expense of $4.1 million, respectively.
The Company estimated the TRS income tax expense for the three and nine months ended September 30, 2021 using an estimated federal and state combined effective tax rate of 3.00%16.00% and recognized an income tax expense of $43 thousand and $0.4 million, respectively. The income tax expense for three and nine months ended September 30, 2021 was primarily attributed to state taxes levied on gross receipts.$1.6 million.
9.8. Stockholders' Equity
Common Stock
The Company maintains an "At-the-Market" ("ATM") program pursuant to an Equity Distribution Agreement ("ATM Agreement") with Wells Fargo Securities, LLC, Robert W. Baird & Co. Incorporated, Jefferies LLC, KeyBanc Capital Markets
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Inc. and Raymond James & Associates, Inc. In accordance with the terms of the ATM Agreement, which was amended and upsized in May 2021, the Company may from time to time offer and sell shares of its common stock having an aggregate offering price of up to $200 million. No shares were sold under the ATM Agreement during the three and nine months ended September 30,March 31, 2023 and 2022 and 2021 and, as of September 30, 2022,March 31, 2023, $200 million of common stock remained available for issuance. As of September 30, 2022,March 31, 2023, and December 31, 2021,2022, the Company had accumulated offering related costs included in other assets on the condensed consolidated balance sheets of $1.0 million and $0.7 million, respectively.$1.1 million. These amountsoffering costs will be reclassified to additional paid in capital to offset proceeds from the sale of common stock. Any remaining accumulated offering costs will be written off when the existing registration statement expires in August 2023.
The Board of Directors has authorized a stock repurchase program pursuant to which the Company is authorized to purchase(the "Repurchase Program") for up to $175$275 million of the Company’s outstanding common stock in the open market, in privately negotiated transactions or otherwise, including pursuant to Rule 10b5-1 plans (the "Repurchase Program").plans. Such repurchases or exchanges, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors. The Repurchase Program does not have an expiration date. This Repurchase Programdate, may be suspended or discontinued at any time and does not obligate the Company to acquire any particular amount of shares.
During the three and nine months ended September 30, 2022, 120,978March 31, 2023, 1,905,820 shares were repurchased under the Repurchase Program, at a weighted-average price of $15.52$14.03 per share for an aggregate purchase price of $1.9$26.7 million. No shares were purchased as part of the Repurchase Program during the ninethree months ended September 30, 2021.March 31, 2022. As of September 30, 2022,March 31, 2023, the Company had approximately $92.8$139.7 million remaining under its share repurchase authorization.
The Company was prohibited under the terms of the amended corporate credit facilities from making repurchases of the Company's common stock until the Company achieved compliance with applicable debt covenants and the Company's covenant waiver period ended. Those restrictions expired upon the Company exiting the covenant waiver period with the delivery of the compliance certificates under the corporate credit facilities for the fiscal quarter ending June 30, 2022.
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Distributions
The Company declared the following dividends during the three and nine months ended September 30, 2022:March 31, 2023:
Dividend per Share/UnitFor the Quarter EndedRecord DatePayable Date
$0.10September 30, 2022March 31, 2023September 30, 2022March 31, 2023OctoberApril 14, 20222023
The Company suspended its quarterly dividend beginning in the second quarter of 2020 through the second quarter of 2022 in order to preserve liquidity. The Company's ability to make distributions was limited by the provisions of the Company's amended corporate credit facilities. Those restrictions expired as a result of the Company exiting the covenant waiver period with the delivery of the compliance certificates under the corporate credit facilities for the fiscal quarter ending June 30, 2022.
Non-Controlling Interest of Common Units in Operating Partnership
As of September 30, 2022,March 31, 2023, the Operating Partnership had 3,427,2854,672,702 LTIP Units outstanding, representing a 2.9%4.1% partnership interest held by the limited partners. Of the 3,427,2854,672,702 LTIP Units outstanding at September 30, 2022, 1,098,691March 31, 2023, 1,803,513 units had vested and had yet to be converted or redeemed. Only vested LTIP Units may be converted to common units of the Operating Partnership, which in turn can be tendered for redemption per the terms of the partnership agreement of the Operating Partnership.
10.9. Earnings Per Share
Basic earnings per common share is calculated by dividing net income or loss available to common stockholders by the weighted-average number of common shares outstanding during the period. Diluted earnings per common share is calculated by dividing net income or loss available to common stockholders by the weighted-average number of common shares outstanding during the period plus any shares that could potentially be outstanding during the period. Any anti-dilutive shares have been excluded from the diluted earnings per share calculation.
Unvested share-based awards that contain nonforfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are participating securities and are included in the computation of earnings per share pursuant to the two-class method. Accordingly, distributed and undistributed earnings attributable to unvested share-based compensation have been excluded, as applicable, from net income or loss available to common stockholders used in the basic and diluted earnings per share calculations.
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Income or loss allocated to non-controlling interests in the Operating Partnership has been excluded from the numerator and Operating Partnership Units and LTIP Units in the Operating Partnership have been omitted from the denominator for the purpose of computing diluted earnings per share since including these amounts in the numerator and denominator would have no impact.
The following table reconciles net income (loss) attributable to common stockholders to basic and diluted earnings per share (in thousands, except share and per share data):
Three Months Ended September 30,Nine Months Ended September 30,Three Months Ended March 31,
202220212022202120232022
Numerator:Numerator:Numerator:
Net income (loss) attributable to common stockholdersNet income (loss) attributable to common stockholders$(1,663)$(22,193)$20,661 $(120,582)Net income (loss) attributable to common stockholders$6,280 $(5,324)
Dividends paid on unvested share-based compensationDividends paid on unvested share-based compensation(119)— (119)— Dividends paid on unvested share-based compensation(67)— 
Undistributed earnings attributable to unvested share-based compensation— — (19)— 
Net income (loss) available to common stockholdersNet income (loss) available to common stockholders$(1,782)$(22,193)$20,523 $(120,582)Net income (loss) available to common stockholders$6,213 $(5,324)
Denominator:Denominator:Denominator:
Weighted-average shares outstanding - BasicWeighted-average shares outstanding - Basic114,322,269 113,809,212 114,334,110 113,798,761 Weighted-average shares outstanding - Basic111,777,894 114,326,406 
Effect of dilutive share-based compensation(1)
Effect of dilutive share-based compensation(1)
— — 385,199 — 
Effect of dilutive share-based compensation(1)
259,475 — 
Weighted-average shares outstanding - DilutedWeighted-average shares outstanding - Diluted114,322,269 113,809,212 114,719,309 113,798,761 Weighted-average shares outstanding - Diluted112,037,369 114,326,406 
Basic and diluted income (loss) per share:Basic and diluted income (loss) per share:Basic and diluted income (loss) per share:
Net income (loss) per share available to common stockholders - basic and dilutedNet income (loss) per share available to common stockholders - basic and diluted$(0.01)$(0.20)$0.18 $(1.06)Net income (loss) per share available to common stockholders - basic and diluted$0.06 $(0.05)
(1)During the three months ended September 30,March 31, 2022,, the Company excluded 351,892423,043 anti-dilutive shares from its calculation of diluted earnings per share. During the three and nine months ended September 30, 2021, the Company excluded 580,479 and 563,820 anti-dilutive shares from its calculation of diluted earnings per share, respectively.
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11.


10. Share-Based Compensation
2015 Incentive Award Plan
Restricted Stock Unit Grants
The Compensation Committee of the Board of Directors approved the following grants of restricted stock units to certain Company employees:
Grant DateGrant DescriptionTime-Based GrantsPerformance-Based GrantsWeighted-Average Grant Date Fair Value
February 20222022 Restricted Stock Units91,272 47,944 $16.09 
April 20222022 Restricted Stock Units3,068 — $19.29 
June 20222022 Restricted Stock Units5,568 — $15.82 
Grant DateGrant DescriptionTime-Based GrantsPerformance-Based GrantsWeighted-Average Grant Date Fair Value
February 20232023 Restricted Stock Units133,393 81,509 $12.30 

Each award of time-based Restricted Stock Units will vest as follows, subject to continued employment with the Company or its affiliates through each applicable vesting date: 33% on the first anniversary of the vesting commencement date, 33% on the second anniversary of the vesting commencement date, and 34% on the third anniversary of the vesting commencement date.
The performance-based Restricted Stock Units are designated twenty-five percent (25%) as absolute total stockholder return ("TSR") units and seventy-five percent (75%) as relative TSR share units. The absolute TSR share units vest based on achievement of varying levels of the Company's TSR over the three-year performance period. The relative TSR share units vest
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based on the ranking of the Company's TSR as compared to a defined peer group over the three-year performance period. Vesting of performance-based Restricted Stock Units is also subject to continued employment with the Company or its affiliates through the applicable vesting date.
In March 2022, pursuant to the Company's Director Compensation Program, 451 fully vested shares of common stock with a grant date fair value of $18.50 per share were granted to a non-employee director in connection with such non-employee director's appointment to the Company's Board of Directors.
LTIP Unit Grants
The Compensation Committee of the Board of Directors approved the issuance of the following awards under the 2015 Incentive Award Plan:
Grant DateGrant DateGrant DescriptionTime-Based LTIP UnitsPerformance-Based Class A LTIP UnitsWeighted-Average Grant Date Fair ValueGrant DateGrant DescriptionTime-Based LTIP UnitsPerformance-Based Class A LTIP UnitsWeighted-Average Grant Date Fair Value
February 20222022 LTIP Units101,474 816,843 $10.49 
February 2023February 20232023 LTIP Units137,617 1,107,800 $8.41 
Each award of time-based LTIP Units will vest as follows, subject to continued employment with the Company or its affiliates through each applicable vesting date: 33% on the first anniversary of the vesting commencement date, 33% on the second anniversary of the vesting commencement date, and 34% on the third anniversary of the vesting commencement date.
A portion of each award of Class A LTIP Units are designated as a number of "base units". The base units are designated twenty-five percent (25%) as absolute TSR base units, and vest based on achievement of varying levels of the Company's TSR over the three-year performance period. The other seventy-five percent (75%) of the base units are designated as relative TSR base units and vest based on the ranking of the Company's TSR as compared to a defined peer group over the three-year performance period. Vesting of Class A LTIP Units is also subject to continued employment with the Company or its affiliates through the vesting date.
LTIP Units (other than unvested Class A LTIP Units), whether vested or unvested, receive the same quarterly per-unit distributions as common units in the Operating Partnership, which equal the per-share distributions on the common stock of the Company. Class A LTIP Units that have not vested receive a quarterly per-unit distribution equal to 10% of the distribution paid on common units in the Operating Partnership.
In May 2022, pursuant to the Company's Director Compensation Program, the Company approved the issuance of 41,496 fully vested LTIP Units to eight of its non-employee directors which had a grant date fair value of $19.28 per unit.
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The following is a summary of the unvested incentive awards under the 2015 Incentive Award Plan as of September 30, 2022:March 31, 2023:
2015 Incentive Award Plan Restricted Stock Units
2015 Incentive Award Plan LTIP Units(1)
Total2015 Incentive Award Plan Restricted Stock Units
2015 Incentive Award Plan LTIP Units(1)
Total
Unvested as of December 31, 2021261,7271,500,3171,762,044
Unvested as of December 31, 2022Unvested as of December 31, 2022224,677 1,720,629 1,945,306 
GrantedGranted148,303 959,813 1,108,116 Granted214,902 1,245,417 1,460,319 
Vested(2)
Vested(2)
(103,895)(131,536)(235,431)
Vested(2)
(65,247)(96,857)(162,104)
ForfeitedForfeited(8,894)— (8,894)Forfeited(2,679)— (2,679)
Unvested as of September 30, 2022297,2412,328,5942,625,835
Unvested as of March 31, 2023Unvested as of March 31, 2023371,653 2,869,189 3,240,842 
Weighted-average fair value of unvested shares/unitsWeighted-average fair value of unvested shares/units$14.96 $11.42 $11.82 Weighted-average fair value of unvested shares/units$13.45 $9.71 $10.14 
(1)    Includes time-based LTIP Units and performance-based Class A LTIP Units.

(2)    During the ninethree months ended September 30,March 31, 2023 and 2022, 17,613 and 2021, 26,431 and 18,99316,478 shares of common stock, respectively, were withheld by the Company upon the settlement of the applicable awards in order to satisfy federal and state tax withholding requirements on the vesting of restricted stock unitsRestricted Stock Units under the 2015 Incentive Award Plan.

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The grant date fair values of the vested common stock, time-based Restricted Stock Units and time-based LTIP Units were determined based on the closing price of the Company’s common stock on the grant date and compensation expense is recognized on a straight-line basis over the vesting period. The grant date fair values of performance-based awards are determined based on a Monte Carlo simulation method with the following assumptions and compensation expense is recognized on a straight-line basis over the performance period:
Performance Award Grant DatePerformance Award Grant DatePercentage of Total AwardGrant Date Fair Value by
Component
(in dollars)
VolatilityInterest RateDividend YieldPerformance Award Grant DatePercentage of Total AwardGrant Date Fair Value by
Component
(in dollars)
VolatilityInterest RateDividend Yield
February 25, 2022
February 24, 2023February 24, 2023
Absolute TSR Restricted Stock UnitsAbsolute TSR Restricted Stock Units25%$9.7241.28%0.68% - 1.72%—%Absolute TSR Restricted Stock Units25%$8.8943.56%4.58% - 5.11%2.80%
Relative TSR Restricted Stock UnitsRelative TSR Restricted Stock Units75%$11.7041.28%0.68% - 1.72%—%Relative TSR Restricted Stock Units75%$9.0843.56%4.58% - 5.11%2.80%
Absolute TSR Class A LTIP UnitsAbsolute TSR Class A LTIP Units25%$9.6241.28%0.68% - 1.72%—%Absolute TSR Class A LTIP Units25%$8.8943.56%4.58% - 5.11%2.80%
Relative TSR Class A LTIP UnitsRelative TSR Class A LTIP Units75%$11.3341.28%0.68% - 1.72%—%Relative TSR Class A LTIP Units75%$8.8143.56%4.58% - 5.11%2.80%
The absolute and relative total stockholder returns are market conditions as defined by Accounting Standard Codification ("ASC") 718, Compensation - Stock Compensation. Market conditions include provisions wherein the vesting condition is met through the achievement of a specific value of the Company’s common stock, which is total stockholder return in this case. Market conditions differ from other performance awards under ASC 718 in that the probability of attaining the condition (and thus vesting of the units or shares) is reflected in the initial grant date fair value of the award.
Accordingly, it is not appropriate to reconsider the probability of vesting in the award subsequent to the initial measurement of the award, nor is it appropriate to reverse any of the expense if the condition is not met. As such, once the expense for these awards is measured, the expense must be recognized over the vesting period regardless of whether the target is met, or at what level the target is met. Expense may only be reversed if the holder of the instrument forfeits the award as a result of the holder's termination of service to the Company prior to vesting.
For the three and nine months ended September 30, 2022,March 31, 2023, the Company recognized approximately $2.8 million and $7.8$2.6 million of share-based compensation expense (net of forfeitures) related to fully vested Restricted Stock Units and LTIP Units provided to its executive officers and certain corporate employees. In addition, for the ninethree months ended September 30, 2022,March 31, 2023, the Company recognized $0.8 million of share-based compensation expense related to grants to the Board of Directors and for the three and nine months ended September 30, 2022 capitalized approximately $0.1 million and $0.3 million (net of forfeitures) related to Restricted Stock Units provided to certain other employees who oversee development and capital projects on behalf of the Company. As of September 30, 2022,March 31, 2023, there was $15.0$22.5 million of total unrecognized compensation costs related to unvested Restricted Stock Units, Class A LTIP Units and Time-Based LTIP Units issued under the 2015 Incentive Award Plan, which are expected to be recognized over a remaining weighted-average period of 1.782.04 additional years.
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For the three and nine months ended September 30, 2021,March 31, 2022, the Company recognized approximately $2.9 million and $8.0$2.2 million of share-based compensation expense (net of forfeitures) related to Restricted Stock Units and LTIP Units provided to certain of its executive officers and other members of management.certain corporate employees. In addition, for the ninethree months ended September 30, 2021,March 31, 2022, the Company recognized $0.8 million of share-based compensation expense related to grants to the Board of Directors and for the three and nine months ended September 30, 2021 capitalized approximately $0.1$0.2 million and $0.5 million, respectively, related to Restricted Stock Units provided to certain members of managementother employees who oversee development and capital projects on behalf of the Company.
12.11. Commitments and Contingencies
Leases
The Company is a lessee to long-term ground, parking, and its corporate office leases, which are accounted for as operating leases. The following is a summary of the Company's leases as of and for the ninethree months ended September 30, 2022March 31, 2023 (dollar amounts in thousands):
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September 30, 2022March 31, 2023
Weighted-average remaining lease term, including reasonably certain extension options(1)
20 years
Weighted-average discount rate5.70%5.71%
ROU asset(2)
$18,93418,488 
Lease liability(3)
$20,14319,628 
Operating lease rent expense$1,616533 
Variable lease costs2,796996 
Total rent and variable lease costs$4,4121,529 
(1)The weighted-average remaining lease term including all available extension options is approximately 56 years.
(2)The ROU asset is included in other assets on the condensed consolidated balance sheet as of September 30, 2022.March 31, 2023.
(3)The lease liability is included in other liabilities on the condensed consolidated balance sheet as of September 30, 2022.March 31, 2023.
The following table shows the remaining lease payments, which includes reasonably certain extension options, for the next five years and thereafter reconciled to the lease liability as of September 30, 2022March 31, 2023 (in thousands):
Year Ending
December 31, 2022
Year Ending
December 31, 2023
2022 (excluding the nine months ended September 30, 2022)$533 
20232,142 
2023 (excluding the three months ended March 31, 2023)2023 (excluding the three months ended March 31, 2023)$1,606 
202420242,157 20242,157 
202520252,172 20252,172 
202620262,188 20262,188 
202720272,204 
ThereafterThereafter26,648 Thereafter24,444 
Total undiscounted lease paymentsTotal undiscounted lease payments$35,840 Total undiscounted lease payments$34,771 
Less imputed interestLess imputed interest(15,697)Less imputed interest(15,143)
Lease liability(1)
Lease liability(1)
$20,143 
Lease liability(1)
$19,628 
(1)The lease liability is included in other liabilities on the condensed consolidated balance sheet as of September 30, 2022.March 31, 2023.
Management and Franchise Agreements
In order to maintain its qualification as a REIT, the Company cannot directly or indirectly operate any of its hotels. The Company leases each hotel to TRS lessees, which in turn engage property managers to manage the hotels. Each hotel is operated pursuant to a hotel management agreement with an independent third-party hotel management company.
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Pursuant to the hotel management agreements, the management company controls the day-to-day operation of each hotel, and the Company is granted limited approval rights with respect to certain of the management company’s actions. The hotel management agreements typically contain a two-tiered fee structure, wherein the management company receives a base management fee and, if certain financial thresholds are met or exceeded, an incentive management fee. Many hotel management agreements also require the maintenance of a capital reserve fund based on a percentage of hotel revenues to be used for capital expenditures to maintain the quality of the hotels.
Management agreements for brand-managed hotels have terms generally ranging from 510 to 3230 years and allow for one or more renewal periods at the option of the hotel manager. Assuming all renewal periods are exercised, the average remaining term is 2527 years. Management agreements for franchised hotels generally contain initial terms between 1015 and 1820 years with an average remaining initial term of approximately foursix years.
The Company is generally limited in its ability to sell, lease or otherwise transfer hotels unless the transferee assumes the related hotel management agreement. However, most agreements include owner rights to terminate the agreements on the basis
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of the manager’s failure to meet certain performance-based metrics. Typically, these criteria are subject to the manager’s ability to ‘cure’ and avoid termination by payment to the Company of specified deficiency amounts (or, in some instances, waiver of the right to receive specified future management fees).
Franchise agreements contain initial terms of 15 to 20 years, with an average remaining initial term of approximately seventen years. The franchise agreements require royalty fees based on a percentage of gross rooms revenue and, for certain hotels, an additional fee based on a percentage of gross food and beverage revenue. In addition, franchise agreements require fees for marketing, reservation or other program fees based on a percentage of gross rooms revenue. Many franchise agreements also require the maintenance of a capital reserve fund based on a percentage of hotel revenues to be used for capital expenditures to maintain the quality of the hotels.
For the three and nine months ended September 30, 2022, theThe Company incurred management and franchise fee expenses of $9.1$10.2 million and $27.8$7.6 million respectively, and for the three and nine months ended September 30, 2021 incurred expenses of $6.0 millionMarch 31, 2023 and $15.0 million2022, respectively, which are included on the condensed consolidated statements of operations and comprehensive income (loss) for the periods then ended.
Reserve Requirements
Certain franchise and management agreements require the Company to reserve funds relating to replacements and renewals of the hotels' furniture, fixtures and equipment. As of September 30, 2022March 31, 2023 and December 31, 2021,2022, the Company had a balance of $42.7$43.5 million and $29.3$46.3 million, respectively, in reserves for such future improvements. This amount is included in restricted cash and escrows on the condensed consolidated balance sheets as of September 30, 2022March 31, 2023 and December 31, 2021,2022, respectively.
Renovation and Construction Commitments
As of September 30, 2022,March 31, 2023, the Company had various contracts outstanding with third-parties in connection with the renovation of certain of its hotel properties. The remaining commitments under these contracts as of September 30, 2022March 31, 2023 totaled $10.7$11.0 million.
Legal
The Company is subject, from time to time, to various legal proceedings and claims that arise in the ordinary course of business. While the resolution of these matters cannot be predicted with certainty, management believes, based on currently available information, that the final outcome of such matters will not have a material adverse effect on the financial condition of the Company.
13.12. Subsequent Events
In August 2022,April and May 2023, the Company entered into an agreement to sell the 115-room Bohemian Hotel Celebration, Autograph Collection, in Celebration, Florida forrepurchased a sale pricetotal of approximately $27.8 million and the buyer funded an at-risk deposit. The sale closed on October 20, 2022 for an estimated gain1,175,286 shares of approximately $12.6 million. Net cash proceeds from the sale, after transaction closing costs, were $25.5 million. The Company also retained the approximately $0.3 million balance in the FF&E reserve.
In October 2022, 415,434 shares were repurchased under the Repurchase Program,common stock at a weighted-average price of $15.18$12.75 per share for an aggregate purchase pricetotal consideration of $6.3approximately $15.0 million.
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Certain statements in this Quarterly Report on Form 10-Q, other than purely historical information, are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These statements include statements about Xenia’s plans, objectives, strategies, financial performance and outlook, trends, the amount and timing of future cash distributions, prospects or future events and involve known and unknown risks that are difficult to predict. As a result, our actual financial results, performance, achievements or prospects may differ materially from those expressed or implied by these forward-looking statements. In some cases, you can identify forward-looking statements by the use of words such as “may,” “could,” “expect,” “intend,” “plan,” “seek,” “anticipate,” “believe,” “estimate,” “guidance,” “predict,” “potential,” “continue,” “likely,” “will,” “would,” “illustrative” and variations of these terms and similar expressions, or the negative of these terms or similar expressions. Such forward-looking statements are necessarily based upon estimates and assumptions that, while considered reasonable by Xenia and its management based on their knowledge and understanding of the business and industry, are inherently uncertain. These statements are not guarantees of future performance, and stockholders should not place undue reliance on forward-looking statements. Forward-looking statements in this Form 10-Q include, among others, statements about our plans, strategies and the ongoing impact of the COVID-19 recovery and other macroeconomic factors, including inflation, rising interest rates and increased concerns over a near-term recession, as well as the ongoing economic recovery following the COVID-19 global pandemic, on our business, including on the demand for travel (including leisure travel and transient and group business travel), capital expenditures, supply chain issues, the ability to consummate acquisitions and dispositions of hotel properties, liquidity, staffing and derivations thereof, financial performance, prospects or future events. There are a number of risks, uncertainties and other important factors, many of which are beyond our control, that could cause our actual results to differ materially from the forward-looking statements contained in this Quarterly Report on Form 10-Q. Such risks, uncertainties and other important factors include, among others: the factors set forth under “Part I-Item 1A. Risk Factors” and “Part II-Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations" in our Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission (the “SEC”) on March 1, 2022,2, 2023, as may be updated elsewhere in this report; and the information set forth in other Quarterly Reports on Form 10-Q and Current Reports on Form 8-K that we have filed or will file with the SEC; including general economic uncertainty and a contraction in the short-U.S. or global economy or low levels of economic growth; macroeconomic factors, including rising interest rates, bank failures and longer-termconcerns over a near-term recession, and other factors beyond our control that can adversely affect and reduce demand for hotel rooms, food and beverage services, and/or meeting facilities; inflation which increases our labor and other costs of providing services to guests and meeting hotel brand standards as well as costs related to construction and other capital expenditures, property and other taxes, and insurance which could result in reduced operating profit margins; the pace and evenness of recovery following the COVID-19 pandemic and the long-term effects of the pandemic, COVID-19 pandemic,variants or any future resurgence, including onwith respect to global and regional economic activity, travel limitations or bans, the demand for travel, (including leisure travel andlevels of spending in transient andor group business travel),and leisure segments, and levels of consumer confidence; actions that governments, businesses, and individuals take in response to the COVID-19 pandemic or any resurgence of the disease or its variants, including limiting or banning travel and implementation of social distancing requirements; the impact of the COVID-19 pandemic, and actions taken in response to the COVID-19 pandemic or any resurgence of the disease or its variants, on global and regional economies, travel, and economic activity, including the duration and magnitude of its impact on staffing levels, impacts to supply chains, and consumer discretionary spending; the broad distribution of COVID-19 vaccines and boosters and wide acceptance by the general population of such vaccines and boosters; the effectiveness of the vaccines and boosters; the ability of third-party managers or other partners to successfully navigate the impacts of the COVID-19 pandemic including labor shortages; the paceability to provide adequate staffing levels required to effectively operating our hotels and meet customer needs; the impact of recovery following the COVID-19 pandemic or any resurgence of the disease or its variants; COVID-19 may cause us to incur additional expenses;supply chain disruptions on our ability to successfully negotiate amendmentssource furniture, fixtures, and covenant waivers underequipment required to comply with brand standards and guest expectations and the ability of our indebtedness;third-party managers to source supplies and other items required for operations; our ability to comply with contractual covenants; business, financial and operating risks inherent to real estate investments and the lodging industry; seasonal and cyclical volatility in the lodging industry; adverse changes in specialized industries, such as the energy, technology and/or tourism industries that result in a sustained downturn of related businesses and corporate spending that may negatively impact our revenues and results of operations; difficulties in procuring required products caused by supply chain disruptions; macroeconomic and other factors beyond our control that can adversely affect and reduce demand for hotel rooms, food and beverage services, and/or meeting facilities, including inflation; contraction in the U.S. and/or global economy or low levels of economic growth; inflationary pressures which increases our labor and other costs of providing services to guests and meeting hotel brand standards, as well as costs related to construction and other capital expenditures, increases in interest rates, property and other taxes, and insurance which could result in reduced operating profit margins; levels of spending in business and leisure segments as well as consumer confidence; declines in occupancy and average daily rate; decreased demand for business travel due to technological advancements and preferences for virtual over in-person meetings and/or changes in guest and consumer preferences, including consideration of the impact of travel on the environment; fluctuations in the supply of hotels, due to hotel construction and/or renovation and expansion of existing hotels, and demand for hotel rooms; changes in the competitive environment in the lodging industry, including due to consolidation of management companies, franchisors and online travel agencies, and changes in the markets where we own hotels; events beyond our control, such as war, terrorist or cyber-attacks, mass casualty events, government shutdowns and closures, travel-related health concerns, global outbreaks of pandemics or contagious diseases, or fear of such outbreaks, weather and climate-related events, such as hurricanes, tornadoes, floods, wildfires, and droughts, and natural or man-made disasters; cyber incidents and information technology failures, including unauthorized access to our computer systems and/or our vendors' computer systems, and our third-party management companies' or franchisors' computer systems and/or their vendors' computer systems; changes in interest rates and operating costs, including labor and service related costs; our inability to directly operate our properties and reliance on third-party hotel management companies to operate and manage our hotels; our ability to maintain good relationships with our third-party hotel management companies and franchisors; our failure to maintain and/or comply with brand operating standards; our ability to maintain our brand licenses at our hotels; relationships with labor unions and changes in labor laws (including increases in minimum wages); loss
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retention and attraction of our senior management team or key corporate personnel; our ability to identify and consummate acquisitions and dispositions of hotels; our ability to integrate and successfully operate any hotel properties acquired in the future and the risks associated with these
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hotel properties; the impact of hotel renovations, repositionings, redevelopments and re-branding activities; our ability to access capital for renovations and acquisitions and general operating needs on terms and at times that are acceptable to us; the fixed cost nature of hotel ownership; our ability to service, restructure or refinance our debt on terms and at times that are acceptable to us; changes in interest rates and operating costs, including labor and service related costs;debt; compliance with regulatory regimes and local laws; uninsured or under insured losses, including those relating to natural disasters, the physical effects of climate change, civil unrest, terrorism or cyber-attacks; changes in distribution channels, such as through internet travel intermediaries or websites that facilitate short-term rental of homes and apartments from owners; the amount of debt that we currently have or may incur in the future; provisions in our debt agreements that may restrict the operation of our business; our organizational and governance structure; our status as a real estate investment trust (“REIT”); our taxable REIT subsidiary (“TRS”) lessee structure; the cost of compliance with and liabilities under environmental, health and safety laws; adverse litigation judgments or settlements; changes in real estate and zoning laws; increases in insurance or other fixed costs and increases in real property tax valuations or rates; changes in federal, state or local tax law, including legislative, administrative, regulatory or other actions affecting REITs; changes in governmental regulations or interpretations thereof; and estimates relating to our ability to make distributions to our stockholders in the future.
These factors are not necessarily all of the important factors that could cause our actual financial results, performance, achievements or prospects to differ materially from those expressed in or implied by any of our forward-looking statements. Other unknown or unpredictable factors also could harm our results. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements set forth above. Forward-looking statements speak only as of the date they are made, and we do not undertake or assume any obligation to update publicly any of these forward-looking statements to reflect actual results, new information or future events, changes in assumptions or changes in other factors affecting forward-looking statements, except to the extent required by applicable laws. If we update one or more forward-looking statements, no inference should be drawn that we will make additional updates with respect to those or other forward-looking statements. 
The following discussion and analysis should be read in conjunction with the Company’s Unaudited Condensed Consolidated Financial Statements and accompanying notes, which appear elsewhere in this Quarterly Report on Form 10-Q.
Overview
Xenia Hotels & Resorts, Inc. ("we", "us", "our", "Xenia" or the "Company") is a self-advised and self-administered REIT that invests in uniquely positioned luxury and upper upscale hotels and resorts with a focus on top 25 lodging as well as key leisure destinations in the United States. As of September 30, 2022,March 31, 2023, we owned 3432 hotels, comprising 9,8129,508 rooms, across 14 states. Our hotels are operated and/or licensed by industry leaders such as Marriott, Hyatt, Fairmont, Kimpton, Fairmont, Loews, Hilton, The Kessler Collection and Davidson.
Ongoing Impact of and Recovery from COVID-19
The onset and global spread of the COVID-19 pandemic led federal, state and local governments in the United States to impose measures intended to control its spread, including restrictions on freedom of movement and business operations, and also to implement multi-step phased policies of re-opening regions of the country. The effects of the COVID-19 pandemic on the hotel industry were significant and unprecedented.
Our hotel portfolio began to see improvements in leisure demand during the second half of 2020, a trend that accelerated in 2021 and has continued in 2022. During the first half of 2022, operations continued to improve including a continuation of strong leisure bookings, higher levels of business transient demand and improving group demand in certain markets resulting in total portfolio ADR climbing above 2019 levels for the comparable period. In the third quarter of 2022, while we experienced our typical seasonal decline in leisure demand, we also saw a broader acceleration of business transient and group business particularly following the Labor Day holiday period. Despite this improvement, there remains uncertainty regarding the pace of recovery and whether and when business travel and larger group meetings will return to pre-pandemic levels. As the recovery continues, we expect that the pace will vary from market to market and may be uneven in nature.
Additionally, there has been increasing uncertainty regarding the broader economic environment as higher levels of inflation have persisted along with rising interest rates and increased concerns of a recession in the near term. We rely on our ability to raise room rates and prices of other products and services to keep pace with inflation. Our hotel operators generally possess the ability to adjust room rates daily, except for certain group or corporate rates contractually committed to in advance, in a stable macroeconomic environment. However, our operators may be unable to raise rates faster than inflation, or even at the same rate, when inflation levels are high due to competitive pressures or prevailing economic conditions.
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Basis of Presentation
The accompanying condensed consolidated financial statements include the accounts of the Company, the Operating Partnership, and XHR Holding. The Company's subsidiaries generally consist of limited liability companies, limited partnerships and the TRS. The effects of all inter-company transactions have been eliminated. Corporate costs directly associated with our principal executive offices, personnel and other administrative costs are reflected as general and administrative expenses on the condensed consolidated statements of operations and comprehensive income (loss).
Our Revenues and Expenses
Our revenue is primarily derived from hotel operations, including rooms revenue, food and beverage revenue and other revenue, which consists of parking, spa, resort fees, other guest services, and tenant leases, among other items.
Our operating costs and expenses consist of the costs to provide hotel services, including rooms expense, food and beverage expense, other direct and indirect operating expenses, and management and franchise fees. Rooms expense includes housekeeping wages and associated payroll taxes, room supplies, laundry services and front desk costs. Food and beverage expense primarily includes the cost of food, beverages and associated labor. Other direct and indirect hotel expenses include labor and other costs associated with the other operating department revenue, as well as labor and other costs associated with general and administrative departments, sales and marketing, information technology and telecommunications, repairs and maintenance and utility costs. We enter into management agreements with independent third-party management companies to operate our hotels. The management companies typically earn base and incentive management fees based on the levels of revenues and profitability of each individual hotel.
Key Indicators of Operating Performance
We measure hotel results of operations and the operating performance of our business by evaluating financial and nonfinancial metrics such as Revenue Per Available Room ("RevPAR"); average daily rate ("ADR"); occupancy rate ("occupancy");
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earnings before interest, income taxes, depreciation and amortization for real estate ("EBITDAre") and Adjusted EBITDAre; and funds from operations ("FFO") and Adjusted FFO. We evaluate individual hotel and company-wide performance with comparisons to budgets, prior periods and competing properties. RevPAR, ADR, and occupancy may be impacted by macroeconomic factors as well as regional and local economies and events. See "Non-GAAP Financial Measures" for further discussion of the Company's use, definitions and limitations of EBITDAre, Adjusted EBITDAre, FFO and Adjusted FFO and the reasons management believes these financial measures are useful to investors.
Results of Operations
Lodging Industry Overview
The U.S. lodging industry historically exhibits a strong correlation to U.S. GDP, which increased at an estimated annual rate of approximately 2.6%1.1% during the thirdfirst quarter of 2022,2023, according to the U.S. Department of Commerce, compared to therepresenting a decrease in the annual rate growth trend from the firstthird and secondfourth quarters of 2022 of 1.4%3.2% and 0.9%2.6%, respectively. The increase during the thirdfirst quarter reflected increases in exports, consumer spending, nonresidential fixed investment,exports, federal government spending, and state and local government spending and nonresidential fixed investment that were partially offset by decreases in private inventory investment and residential fixed investment private inventory investments andas well as increases in imports. In addition, the unemployment rate fell toremained flat at 3.5% in March 2023 compared to December 2022 and September from 3.6% in June and March. The unemployment rate has declined considerably from the April 2020 high of 14.7%.
The U.S. lodging industry was more acutely impacted by the COVID-19 pandemic than the overall U.S. economy and other industries and has not experienced the same level of recovery as the U.S. economy which is largely due to the persistence of the COVID-19 pandemic and its variants and sentiment towards business and leisure travel as a result of the pandemic. While the U.S. lodging industry has rebounded significantly, we believe there remains room for additional growth, particularly for upper upscale and luxury hotels. Further, we2022. We continue to monitor and evaluate the challenges associated with inflationary pressures, and rising interest rates, a potential domestic and/or global recession, the evolving workforce landscape and potential ongoing supply chain issues. The impact of these potential challenges could negatively impact the Company’s operating results as well as ongoing supply chain issues which may continue to impact the hotels'its ability to source operating suppliesconsummate acquisitions and other materials.dispositions of hotel properties in the near term.
Demand and new hotel supply increased 5.6%6.4% and 13.4%0.4%, respectively, during the three and nine months ended September 30, 2022. New hotel supply increased by 1.1% and 2.4%, respectively, during the same period.March 31, 2023. The increase in demand led to increasesan increase in industry RevPAR of 16.6% and 34.9%16.7% for the three and nine months ended September 30, 2022March 31, 2023 compared to 2021,2022, which was driven by an increase in occupancy of 4.5% and 10.8%5.9% coupled with an 11.6% and 21.8%a 10.2% increase in ADR, respectively.ADR. All U.S. data for the three and nine months ended September 30, 2022March 31, 2023 are per industry reports.
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ThirdFirst Quarter 20222023 Overview
Our total portfolio RevPAR, which includes the results of hotels sold or acquired for the period of ownership by the Company, increased 32.5% and 70.6%24.7% to $157.91 and $162.69$179.55 for the three and nine months ended September 30, 2022March 31, 2023 compared to $119.17 and $95.35$143.99 for the three and nine months ended September 30, 2021, respectively.March 31, 2022. The increase in our total portfolio RevPAR for the three and nine months ended September 30, 2022March 31, 2023 compared to the same period in 20212022 was driven by increasesstrong RevPAR growth in leisure transient business and improvingboth business transient and corporate group demand.demand, robust leisure transient demand and by easier comparable performance during January and February of 2022 when the Omicron variant significantly impacted travel. Further, while leisure demand remains at historically high levels, demand has continued to shift to a more traditional mix within our portfolio.
Net loss decreased 92.5%income increased 219.6% for the three months ended September 30, 2022March 31, 2023 compared to net loss for the three months ended September 30, 2021,March 31, 2022, which was primarily attributed to an increase in hotel operating income of $15.8$19.2 million from the 33-comparable31-comparable hotels owned during the three months ended September 30,March 31, 2023 and 2022, and 2021 asother income of $1.3 million in 2023 compared to other loss of $0.8 million in 2022, a result of the ongoing recovery from the COVID-19 pandemic, a $2.5 million increase in gain on business interruption insurance, a $1.8$1.3 million reduction in impairment and other losses an increase in other income of $1.6 million in 2022 compared to 2021 primarily from insurance proceeds in excess of recognized losses related to damage sustained at Loews New Orleans Hotel during Hurricane Ida, a $1.0 million income tax benefit and a $0.8 million reduction in interest expense. These increases were partially offset by a $1.5$1.1 million increase in corporate general and administrative expenses and a $0.9 million decrease in operating income attributed to the acquisition of W Nashville.
Net income increased 117.3% for the nine months ended September 30, 2022 compared to net loss in nine months ended September 30, 2021, which was primarily attributed to an increase in operating income of $131.1 million from the 33-comparable hotels owned during the nine months ended September 30, 2022 and 2021 as a result of the ongoing recovery from the COVID-19 pandemic, an $12.8 million reduction in impairment and other losses, other income of $2.7 million in 2022 from insurance proceeds in excess of recognized losses related to damage sustained at Loews New Orleans Hotel during Hurricane Ida compared to other loss of $2.5 million in 2021 from the termination of four interest rate hedges, a $1.4 million increase in gain on business interruption insurance, a $1.1 million reduction in operating loss attributed to the sale of hotels in November 2021 and January 2022, a $1.1 million reduction in loss on extinguishment of debt and a $0.9 million increase inhotel operating income attributed to the acquisition of W Nashville. These increases were partially offset by a $3.8$3.6 million increase in income tax expense, a $3.4$3.2 million increase in corporate generaldepreciation and administrative expenses andamortization expense, a $1.7$1.6 million increase in interest expense, primarilya $1.2 million increase in general and administrative expenses, a $1.2 million reduction in hotel operating income attributed to the three hotels sold in 2022, a higher weighted-average interest rate.$0.8 million increase in loss on extinguishment of debt and a $0.1 million increase in other operating expenses.
Adjusted EBITDAre and Adjusted FFO attributable to common stock and unit holders for the three and nine months ended September 30, 2022March 31, 2023 increased 52.1%42.8% and 225.4%, and 132.9% and 3,561.3%,55.5% respectively, compared to three and nine months ended September 30, 2021, which was attributable to the extent and timing of the impact of and recovery from the COVID-19 pandemic on our results of operations.March 31, 2022. Refer to "Non-GAAP Financial Measures" for the definition of these financial measures, a description of the reasons we believe they are useful to investors as key supplemental measures of our operating performance and the reconciliation of these non-GAAP financial measures to net income (loss) attributable to common stock and unit holders.
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Operating Information Comparison
The following table sets forth certain operating information for the three and nine months ended September 30, 2022March 31, 2023 and 2021:2022:
Nine Months Ended
September 30,
Three Months Ended
March 31,
20222021Change20232022Change
Number of properties at January 1
Number of properties at January 1
3435(1)
Number of properties at January 1
3234(2)
Properties acquiredProperties acquired11Properties acquired1(1)
Properties disposedProperties disposed(1)(1)Properties disposed(1)1
Number of properties at September 303435(1)
Number of properties at March 31Number of properties at March 313234(2)
Number of rooms at January 1Number of rooms at January 19,65910,011(352)Number of rooms at January 19,5089,659(151)
Rooms in properties acquiredRooms in properties acquired346346Rooms in properties acquired346(346)
Rooms in properties disposed(1)
Rooms in properties disposed(1)
(193)(193)
Rooms in properties disposed(1)
(191)191
Number of rooms at September 309,81210,011(199)
Number of rooms at March 31Number of rooms at March 319,5089,814(306)
Three Months Ended
September 30,
Nine Months Ended
September 30,
Three Months Ended
March 31,
20222021Increase20222021Increase20232022Increase
Total Portfolio Statistics:Total Portfolio Statistics:Total Portfolio Statistics:
Occupancy(2)(1)
Occupancy(2)(1)
63.4 %53.7 %970  bps63.0 %45.2 %1,780  bps
Occupancy(2)(1)
66.1 %56.6 %950  bps
ADR(2)(1)
ADR(2)(1)
$249.02 $221.91 12.2 %$258.05 $211.13 22.2 %
ADR(2)(1)
$271.79 $254.57 6.8 %
RevPAR(2)(1)
RevPAR(2)(1)
$157.91 $119.17 32.5 %$162.69 $95.35 70.6 %
RevPAR(2)(1)
$179.55 $143.99 24.7 %
(1)    During the nine months ended September 30, 2022, the Company disposed of one hotel with 191 rooms and reduced the room count by two at Hyatt Regency Scottsdale Resort & Spa at Gainey Ranch.
(2)    For hotels acquired during the applicable period, includes operating statistics since the date of acquisition. For hotels disposed of during the period, operating results and statistics are included through the date of the respective disposition. The nine months ended September 30, 2021 includes hotels that had suspended operations for a portion of the period presented.
Revenues
Revenues consists of rooms, food and beverage, and other revenues from our hotels, as follows (in thousands):
Three Months Ended September 30,Nine Months Ended September 30,Three Months Ended March 31,
20222021Increase% Change20222021Increase% Change20232022Increase / (Decrease)% Change
Revenues:Revenues:Revenues:
Rooms revenuesRooms revenues$142,604 $109,753 $32,851 29.9 %$431,382 $260,594 $170,788 65.5 %Rooms revenues$153,645 $123,198 $30,447 24.7 %
Food and beverage revenuesFood and beverage revenues76,153 44,004 32,149 73.1 %240,669 105,739 134,930 127.6 %Food and beverage revenues96,124 67,735 28,389 41.9 %
Other revenuesOther revenues21,911 19,027 2,884 15.2 %62,415 46,277 16,138 34.9 %Other revenues19,204 19,414 (210)(1.1)%
Total revenuesTotal revenues$240,668 $172,784 $67,884 39.3 %$734,466 $412,610 $321,856 78.0 %Total revenues$268,973 $210,347 $58,626 27.9 %
Rooms revenues
Rooms revenues increased by $32.9$30.4 million, or 29.9%24.7%, to $142.6$153.6 million for the three months ended September 30, 2022March 31, 2023 from $109.8$123.2 million for the three months ended September 30, 2021 primarily due to increasesMarch 31, 2022 driven by strong RevPAR growth in occupancyboth business transient and ADR due to the ongoing recovery from the COVID-19 pandemic.corporate group demand and robust leisure transient demand. Additionally, the acquisition of W Nashville in March 2022 contributed to the increase in rooms revenue by $7.1$5.4 million. The increase is net of a reduction of $4.0$3.3 million attributed to the sale of Marriott Charleston Town Center in November 2021 and Kimpton Hotel Monaco Chicago in January 2022, Bohemian Hotel Celebration, Autograph Collection in October 2022 and Kimpton Hotel Monaco Denver in December 2022 (collectively, "the three hotels sold in November 2021 and January 2022").
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Rooms revenuesrevenue increased by $170.8$28.4 million, or 65.5%23.8%, for remainder of our 31-comparable hotels, which was attributed to $431.4 million for the nine months ended September 30,a 23.8% increase in RevPAR compared to 2022, from $260.6 million for the nine months ended September 30, 2021 primarily due to increasesdriven by a 5.1% increase in ADR and an increase in occupancy and ADR due to the ongoing recovery from the COVID-19 pandemic. Additionally, the acquisition of W Nashville in March 2022 contributed to the increase in rooms revenue by $16.2 million. This increase is net of a reduction of $8.1 million attributed to the hotels sold in November 2021 and January 2022.1,010 basis points.
Food and beverage revenues
Food and beverage revenues increased by $32.1$28.4 million, or 73.1%41.9%, to $76.2$96.1 million for the three months ended September 30, 2022March 31, 2023 from $44.0$67.7 million for the three months ended September 30, 2021March 31, 2022 primarily due to increasessignificant growth in occupancy due to the ongoing recovery from the COVID-19 pandemic.business transient and
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corporate group demand. Additionally, the acquisition of W Nashville in March 2022 contributed to the increase in food and beverage revenue by $5.7$4.5 million. This increase is net of a reduction of $1.1$1.7 million attributed to the three hotels sold in November 2021 and January 2022.
Food and beverage revenues increased by $134.9$25.6 million, or 127.6%39.0%, to $240.7 million for the nine months ended September 30, 2022 from $105.7 million for the nine months ended September 30, 2021 primarily due to increases in occupancy due to the ongoing recovery from the COVID-19 pandemic. Additionally, the acquisitionremainder of W Nashville in March 2022 contributed to the increase in food and beverage revenue by $12.8 million. This increase is net of a reduction of $1.9 million in food and beverage revenues attributed to the hotels sold in November 2021 and January 2022.our 31-comparable hotels.
Other revenues
Other revenues increaseddecreased by $2.9$0.2 million, or 15.2%1.1%, to $21.9$19.2 million for the three months ended September 30, 2022March 31, 2023 from $19.0$19.4 million for the three months ended September 30, 2021March 31, 2022. This decrease was primarily dueattributable to the ongoing recovery from the COVID-19 pandemic. This increase includes $1.0a $1.8 million reduction in additional revenues from cancellation and attrition for our 31-comparable hotels as well as $0.8a reduction of $0.4 million attributed to the three hotels sold in 2022. These decreases are net of a $1.4 million increase in other revenue, excluding revenue from cancellations and attrition for our 31-comparable hotels and a $0.5 million increase attributed to the acquisition of W Nashville in March 2022. These increases are net of a reduction of $0.3 million attributed to the hotels sold in November 2021 and January 2022.
Other revenues increased by $16.1 million, or 34.9%, to $62.4 million for the nine months ended September 30, 2022 from $46.3 million for the nine months ended September 30, 2021 primarily due to the ongoing recovery from the COVID-19 pandemic. This increase includes $6.0 million in additional revenues from cancellations and attrition as well as $1.4 million attributed to the acquisition of W Nashville in March 2022. These increases are net of a reduction of $0.7 million attributed to the hotels sold in November 2021 and January 2022.
Hotel Operating Expenses
Hotel operating expenses consist of the following (in thousands):
Three Months Ended September 30,Nine Months Ended September 30,Three Months Ended March 31,
20222021Increase% Change20222021Increase% Change20232022Increase% Change
Hotel operating expenses:Hotel operating expenses:Hotel operating expenses:
Rooms expensesRooms expenses$36,163 $27,099 $9,064 33.4 %$101,803 $65,024 $36,779 56.6 %Rooms expenses$36,203 $29,217 $6,986 23.9 %
Food and beverage expensesFood and beverage expenses55,888 33,764 22,124 65.5 %161,796 80,534 81,262 100.9 %Food and beverage expenses60,687 45,610 15,077 33.1 %
Other direct expensesOther direct expenses6,155 5,059 1,096 21.7 %17,815 12,993 4,822 37.1 %Other direct expenses5,698 5,294 404 7.6 %
Other indirect expensesOther indirect expenses64,590 50,902 13,688 26.9 %181,509 132,276 49,233 37.2 %Other indirect expenses66,499 53,860 12,639 23.5 %
Management and franchise feesManagement and franchise fees9,083 6,025 3,058 50.8 %27,758 15,009 12,749 84.9 %Management and franchise fees10,189 7,626 2,563 33.6 %
Total hotel operating expensesTotal hotel operating expenses$171,879 $122,849 $49,030 39.9 %$490,681 $305,836 $184,845 60.4 %Total hotel operating expenses$179,276 $141,607 $37,669 26.6 %
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Total hotel operating expenses
In general, hotel operating costs generally correlate to increases or decreases in revenues and fluctuate based on various factors, including occupancy, labor costs, utilities and insurance costs. Luxury and upper upscale hotels generally have higher fixed costs than other types of hotels due to the level of services and amenities provided to guests.
Total hotel operating expenses increased $49.0$37.7 million, or 39.9%26.6%, to $171.9$179.3 million for the three months ended September 30, 2022March 31, 2023 from $122.8$141.6 million for the three months ended September 30, 2021 primarily due to increases in occupancy and other related operating costs due to the ongoing recovery from the COVID-19 pandemic.March 31, 2022. Additionally, W Nashville contributed to the increase in hotel operating expenses by $10.0$8.6 million. The increase in total hotel operating expenses is net of a reduction of $4.2 million attributed to the three hotels sold in November 2021 and January 2022.
Total hotel Hotel operating expenses increased $184.8$33.1 million, or 60.4%24.2%, to $490.7 million for the nine months ended September 30, 2022 from $305.8 million for the nine months ended September 30, 2021 primarily due to increases in occupancy and other related operating costs due to the ongoing recovery from the COVID-19 pandemic. Additionally, W Nashville contributedremainder of our 31-comparable hotels, which was attributed to the increase in hotel operating expenses by $20.7 million. The increasetotal revenues in total hotel operating expenses is net of a reduction of $9.5 million attributed2023 compared to the hotels sold in November 2021 and January 2022.
Corporate and Other Expenses
Corporate and other expenses consist of the following (in thousands):
Three Months Ended September 30,Nine Months Ended September 30,Three Months Ended March 31,
20222021Increase / (Decrease)% Change20222021Increase / (Decrease)% Change20232022Increase / (Decrease)% Change
Depreciation and amortizationDepreciation and amortization$34,311 $32,076 $2,235 7.0 %$99,127 $98,281 $846 0.9 %Depreciation and amortization$33,741 $30,565 $3,176 10.4 %
Real estate taxes, personal property taxes and insuranceReal estate taxes, personal property taxes and insurance11,228 9,731 1,497 15.4 %33,452 31,268 2,184 7.0 %Real estate taxes, personal property taxes and insurance12,470 10,855 1,615 14.9 %
Ground lease expenseGround lease expense685 405 280 69.1 %2,035 1,187 848 71.4 %Ground lease expense710 517 193 37.3 %
General and administrative expensesGeneral and administrative expenses8,972 7,466 1,506 20.2 %25,841 22,484 3,357 14.9 %General and administrative expenses8,783 7,611 1,172 15.4 %
Gain on business interruption insurance(2,487)— (2,487)— %(2,487)(1,116)(1,371)(122.8)%
Other operating expensesOther operating expenses232 175 57 32.6 %
Impairment and other lossesImpairment and other losses— 1,759 (1,759)(100.0)%1,278 14,072 (12,794)(90.9)%Impairment and other losses— 1,278 (1,278)(100.0)%
Total corporate and other expensesTotal corporate and other expenses$52,709 $51,437 $1,272 2.5 %$159,246 $166,176 $(6,930)(4.2)%Total corporate and other expenses$55,936 $51,001 $4,935 9.7 %
Depreciation and amortization
Depreciation and amortization expense increased $2.2$3.2 million, or 7.0%, and $0.8 million, or 0.9%10.4%, to $34.3 million and $99.1$33.7 million for the three and nine months ended September 30, 2022March 31, 2023 from $32.1 million and $98.3$30.6 million for the three and nine months ended September 30, 2021.March 31, 2022. This increase was primarily attributed to the acquisition of
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W Nashville in March 2022 partially offset by reduction attributedand to the timing of fully depreciated assets during the comparable periods andperiods. These increases are net of a reduction in depreciation expense related to the three hotels sold in November 2021 and January 2022.
Real estate taxes, personal property taxes and insurance
Real estate taxes, personal property taxes and insurance expense increased $1.5$1.6 million, or 15.4%, and $2.2 million, or 7.0%14.9%, to $11.2 million and $33.5$12.5 million for the three and nine months ended September 30, 2022March 31, 2023 from $9.7 million and $31.3$10.9 million for the three and nine months ended September 30, 2021.March 31, 2022. This year-to-date increase was primarily attributed to increases in insurance premiums of $2.3$0.9 million, $1.8 million attributed foran increase related to the acquisition of W Nashville in March 2022 of $0.7 million and a $1.5$0.1 million non-recurring property tax refund received in 2021. These increases were partially offset by a $2.0 million reductionincrease in real estate taxes andtaxes. These increases are net of a $1.2$0.2 million reduction related to the three hotels sold in November 2021 and January 2022.
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Ground lease expense
Ground lease expense increased $0.3$0.2 million, or 69.1%, and $0.8 million, or 71.4%37.3%, to $0.7 million and $2.0 million for the three and nine months ended September 30, 2022March 31, 2023 from $0.4 million and $1.2$0.5 million for the three and nine months ended September 30, 2021.March 31, 2022. The increase was primarily attributable to an increase in percentage rent in 2022,2023, which is based on revenues at certain hotels with ground leases, compared to 2021.2022.
General and administrative expenses
General and administrative expenses increased $1.5$1.2 million, or 20.2% and $3.4 million, or 14.9%15.4%, to $9.0 million and $25.8$8.8 million for the three and nine months ended September 30, 2022March 31, 2023 from $7.5 million and $22.5$7.6 million for the three and nine months ended September 30, 2021March 31, 2022 primarily due to increases in the number of corporate employees, employee-related expenses.
Gain on business interruption insurance
Gain on business interruption insurance was $2.5 million for the threeexpenses and nine months ended September 30, 2022, which was attributed to $1.5 million in insurance proceeds for a portion of lost income associated with cancellations at Loews New Orleans Hotel due to the impact of Hurricane Ida in August 2021 as well as $1.0 million in proceeds for lost income associated with cancellations for properties in Texas due to the impact of the Texas winter storms in February 2021. Gain on business interruption insurance was $1.1 million for the nine months ended September 30, 2021, which was attributed to insurance proceeds for a portion of lost revenue associated with cancellations related to the COVID-19 pandemic.increased incentive compensation.
Impairment and other losses
In August 2021, Hurricane Ida impacted Loews New Orleans Hotel located in New Orleans, Louisiana. During the ninethree months ended September 30,March 31, 2022, the Company expensed additional hurricane-related repair and cleanup costs of $1.3 million.
During the three and six months ended June 30, 2021, the Company concluded that it intended to sell the 352-room Marriott Charleston Town Center, in Charleston, West Virginia and began marketing the property. Based on multiple bids from qualified buyers and ongoing price discussions, the Company expected the hotel to be sold for a price that was less than its net book value. As a result, an impairment loss of approximately $12.3 million was recorded for the three and six months ended June 30, 2021. The Company subsequently recorded an additional impairment loss of $0.3 million for the three and nine months ended September 30, 2021 related to estimated closing costs. In addition, during the three and nine months ended September 30, 2021, the Company recorded an impairment loss of $0.5 million related to Loews New Orleans Hotel which sustained damage from Hurricane Ida and expensed $1.0 million of hurricane-related repair and cleanup costs.
Non-Operating Income and Expenses
Non-operating income and expenses consist of the following (in thousands):
Three Months Ended September 30,Nine Months Ended September 30,Three Months Ended March 31,
20222021Increase / (Decrease)% Change20222021Increase / (Decrease)% Change20232022Increase% Change
Non-operating income and expenses:Non-operating income and expenses:Non-operating income and expenses:
Other income (loss)Other income (loss)$1,767 $186 1,581 850.0 %2,671 (2,503)5,174 206.7 %Other income (loss)$1,284 $(777)2,061 265.3 %
Interest expenseInterest expense(20,583)(21,358)(775)(3.6)%(61,474)(59,799)1,675 2.8 %Interest expense(22,134)(20,538)1,596 7.8 %
Loss on extinguishment of debtLoss on extinguishment of debt— — — — %(294)(1,356)1,062 78.3 %Loss on extinguishment of debt(1,140)(294)846 287.8 %
Income tax benefit (expense)1,029 (43)1,072 2,493.0 %(4,148)(377)(3,771)(1,000.3)%
Income tax expenseIncome tax expense(5,218)(1,607)3,611 224.7 %
Other income (loss)
Other income increased $1.6$2.1 million, or 850.0%, and $5.2 million, or 206.7%265.3%, to $1.8 million and $2.7$1.3 million for the three and nine months ended September 30, 2022March 31, 2023 from income of $0.2 million and a loss of $2.5$0.8 million for the three and nine months ended September 30, 2021. The increaseMarch 31, 2022. Other income for the three months ended March 31, 2023 was primarily attributedattributable to interest income from higher interest rates on cash balances, partially offset by non-capitalizable loan issuance costs. The other loss for the three months ended March 31 2022 was primarily attributable to costs associated with the termination of two interest rate hedges, partially offset by a gain from the receipt of $1.0 million and $3.6 million from insurance proceeds settlements in excess of recognized losses associated with hurricane-related damage at Loews New Orleans Hotel as well as increased interest income of $0.6 million and $0.8 million for the three and nine months ended September 30, 2022, respectively, offset by $1.6 million of costs associated with the termination of two interest rate hedges for the nine months
34



ended September 30, 2022. Additionally, there were $2.8 million of costs associated with the termination of four interest rate hedges for the nine months ended September 30, 2021.Hotel.
Interest expense
Interest expense decreased $0.8increased $1.6 million, or 3.6%7.8%, to $20.6$22.1 million for the three months ended September 30, 2022March 31, 2023 from $21.4$20.5 million for the three months ended September 30, 2021.March 31, 2022. The decreaseincrease was primarily due to the payoff of one mortgage loan in January 2022,rising interest rates on variable rate debt, partially offset by a reduction in interest payments to swap counterparties and a reduced spread on credit facility interest based on a pricing grid with the delivery of compliance certificates under the corporate credit facilities. This decrease was partially offset by rising interest rates on variable rate debt.
Interest expense increased $1.7 million, or 2.8%, to $61.5 million for the nine months ended September 30, 2022 from $59.8 million for the nine months ended September 30, 2021. The increase was primarily due to an increase in the weighted-average interest rate, partially offset by a decrease in the outstanding debt as of September 30, 2022 compared to 2021. Refer to Note 5 in the accompanying condensed consolidated financial statements for further discussion.counterparties.
Loss on extinguishment of debt
The loss on extinguishment of debt of $1.1 million for the three months ended March 31, 2023 was attributable to the write-off of certain unamortized debt issuance costs associated with the existing revolving credit facility, which was refinanced with the Revolving Line of Credit in January 2023, as well as the early repayments of the corporate credit facility term loan that was due to mature in September 2024 and one mortgage loan. The loss on extinguishment of debt of $0.3 million for the ninethree months
26


ended September 30,March 31, 2022 was attributable to the write-off of unamortized debt issuance costs upon the early repayment of one mortgage loan. The loss on extinguishment of debt of $1.4 million for the three and nine months ended September 30, 2021 was attributable to the write off of unamortized debt issuance costs upon the early repayment of the corporate credit facility term loan that was due to mature in August 2023 and one mortgage loan.
Income tax benefit (expense)expense
Income tax benefitexpense increased $1.1$3.6 million, or 2,493.0%224.7%, to $1.0$5.2 million for the three months ended September 30, 2022March 31, 2023 from income tax expense of $43 thousand$1.6 million for the three months September 30, 2021 and income tax expense increased $3.8 million, or 1,000.3%, to $4.1 million for the nine months ended September 30, 2022 from $0.4 million for the nine months ended September 30, 2021.March 31, 2022. The increase from prior year was primarily attributed to higher projected taxable income related to the recovery from the COVID-19 pandemic and the acquisition of W Nashville in March 2022 coupled with an increase in the effective tax rate for the first three quartersquarter of 20222023 compared to 2021.2022. These increases were partially offset by the use of federal and state net operating loss carryforwards.
Liquidity and Capital Resources
We expect to meet our short-term liquidity requirements from cash on hand, cash flow from hotel operations, use of our unencumbered asset base, asset dispositions, borrowings under our revolving credit facility,Revolving Line of Credit, and proceeds from various capital market transactions, including issuances of debt and equity securities. The objectives of our cash management policy are to maintain the availability of liquidity and minimize operational costs.
On a long-term basis, our objectives are to maximize revenue and profits generated by our existing properties and acquired hotels, to further enhance the value of our portfolio and produce an attractive current yield, as well as to generate sustainable and predictable cash flow from our operations to distribute to our common stock and unit holders. We believe successful improvements to the performance of our portfolio will result in increased operating cash flows over time. Additionally, we may meet our long-term liquidity requirements through additional borrowings, the issuance of equity and debt securities, which may not be available on advantageous terms or at all, and/or proceeds from the sales of hotels.
In 2017, the U.K. Financial Conduct Authority (“FCA”) announced that it intends to phase out LIBOR, and in 2021, it announced that all LIBOR settings will either cease to be provided by any administrator or no longer be representative immediately after December 31, 2021, in the case of 1 week and 2 month USD settings, and immediately after June 30, 2023, in the case of the remaining USD settings. The U.S. Federal Reserve (the “Federal Reserve”) has also advised banks to cease entering into new contracts that use USD LIBOR as a reference rate. The Alternative Reference Rate Committee, a committee convened by the Federal Reserve that includes major market participants, identified the Secured Overnight Financing Rate (“SOFR”), a new index calculated by short-term repurchase agreements, backed by U.S. Treasury securities, as its preferred alternative rate for LIBOR in the U.S. Any changes in the methods by which LIBOR is determined or regulatory activity related to LIBOR’s phaseout could cause LIBOR to perform differently than in the past or cease to exist. The consequences of these developments cannot be entirely predicted, but could have an uncertain impact on our cost of funds, our receipts or payments under agreements that rely on LIBOR, and the valuation of derivative or other contracts to which we are a party, any of which could impact our results of operations and cash flows. We are currently monitoring and evaluating the related risks in connection with transitioning contracts to SOFR or a new alternative rate, including resulting value transfer that may occur.
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Liquidity
As of September 30, 2022,March 31, 2023, we had $259.9$283.2 million of consolidated cash and cash equivalents and $50.8$58.2 million of restricted cash and escrows. The restricted cash as of September 30, 2022March 31, 2023 primarily consisted of $42.7$43.5 million related to FF&E reserves as required per the terms of our management and franchise agreements, $8.2 million in deposits made for capital projects, cash held in restricted escrows of $4.7$4.8 million primarily for real estate taxes and mortgage escrows and $3.4$1.7 million in deposits made for capital projects.disposition-related holdbacks.
As of September 30, 2022,March 31, 2023, there was no outstanding balance on our revolving credit facilityRevolving Line of Credit and the full $450 million is available to be borrowed. Proceeds from future borrowings may be used for working capital, general corporate or other purposes permitted by the amended revolving credit agreement.purposes.
In May 2021, we upsized the ATM Agreement and, as a result,As of March 31, 2023, we had $200 million available for sale under the ATM Agreement as of September 30, 2022. The terms of the amended revolving credit facility imposed restrictions on the use of proceeds raised from equity issuances, however those restrictions expired as a result of the Company exiting the covenant waiver period with the delivery of the compliance certificates under the corporate credit facilities for the fiscal quarter ending June 30, 2022.Agreement.
We remain committed to increasing total shareholder returns through the following priorities: (1) maximize revenue and profits generated by our existing properties and acquired hotels, including the continued focused management of expenses, (2) further enhance the value of our portfolio and produce an attractive current yield and (3) generate sustainable and predictable cash flow from our operations to distribute to our common stock and unit holders. Future determinations regarding the declaration and payment of dividends will be at the discretion of our Board of Directors and will depend on then-existing conditions, including our results of operations, payout ratio, capital requirements, financial condition, prospects, contractual arrangements, any limitations on payment of dividends present in our current and future debt agreements, maintaining our REIT status and other factors that our Board of Directors may deem relevant.
Debt and Loan Covenants
As of September 30, 2022,March 31, 2023, our outstanding total debt was $1.4 billion and had a weighted-average interest rate of 5.28%5.72%.
Mortgage Loans
In January 2022, we2023, the Company repaid in full the $65.0$99.5 million outstanding balance on the mortgage loan collateralized by The Ritz-Carlton, Pentagon City. Renaissance Atlanta Waverly Hotel & Convention Center using proceeds from the 2023 Delayed Draw Term Loan. Also in January 2023, the Company amended the mortgage loan collateralized by Andaz Napa to update the variable index from one-month LIBOR to Term SOFR, increase the credit spread, increase the principal amount to $55 million and extend the maturity date through January 2028.
Our mortgage loan agreements require contributions to be made to FF&E reserves. In addition, certain quarterly financial covenants were waived for a period of time specified inreserves and the respective amended loan agreements andcompliance with certain financial covenants have been adjusted following the waiver periods.covenants.
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Corporate Credit Facilities
Certain financial covenants relatedIn January 2023, XHR LP (the "Borrower") entered into a new $675 million senior unsecured credit facility comprised of a $450 million revolving line of credit (the "Revolving Line of Credit”), a $125 million term loan (the "2023 Initial Term Loan") and a $100 million delayed draw term loan (the “2023 Delayed Draw Term Loan” and, together with the 2023 Initial Term Loan, the "2023 Term Loans") pursuant to a Revolving Credit and Term Loan Agreement, dated as of January 10, 2023, by and among the Borrower, JPMorgan Chase Bank, N.A., as administrative agent, and the lenders and other parties thereto (the “2023 Credit Agreement”). The Revolving Line of Credit and the 2023 Initial Term Loan refinanced in full our amendedexisting corporate credit facilities were suspended untiloutstanding under the date thatCompany's prior credit agreement, and as a result of such refinancing, the compliance certificates demonstrating compliance with the financial covenants thereunder for the fiscal quarter ending June 30, 2022 were delivered (such period, the "covenant waiver period"). Certain financial covenants that were suspended during the covenant waiver period resumed quarterly testing beginning with the fiscal quarter ending June 30, 2022 but remain at modified covenant levels through the second quarter in 2023 (such period, unless earlier terminated by the Operating Partnership in accordance with the terms of the amended corporate credit facilities, the "permitted variations period"). In addition, the amended corporate credit facilities had certain restrictions and covenants which were applicable during the covenant waiver period, including (i) mandatory prepayment requirements, (ii) affirmative covenants related to the pledgeexisting pledges of equity of certain subsidiaries and (iii) negative covenants restricting certain acquisitions, investments, capital expenditures, ground leases and distributions. A minimum liquidity covenant also applied during the covenant waiver period.
We determined that we met our modified financial covenants for the quarter ended June 30, 2022 and delivered the compliance certificates demonstrating such compliancesecuring obligations under the amended corporateprior credit facilities were released. The 2023 Delayed Draw Term Loan was funded on January 17, 2023 and was used to repay in full the mortgage loan collateralized by Renaissance Atlanta Waverly Hotel & Convention Center that was due August 2024. Proceeds from future Revolving Line of Credit borrowings may be used for working capital, general corporate or other purposes permitted by the 2023 Credit Agreement. The Revolving Line of Credit matures in January 2027 and can be extended up to an additional year. The interest rate on the Revolving Line of Credit and the 2023 Term Loans is based on a pricing grid with a range of 145 to 275 basis points over the applicable Term SOFR rate as a result, are no longerdetermined by the Company’s leverage ratio, subject to a 10 basis point credit spread adjustment and a zero basis point floor. The 2023 Term Loans mature in March 2026, can be extended up to an additional year, and bear interest rates consistent with the additional restrictions and covenants that applied duringpricing grid on the covenant waiver period, other than in respectRevolving Line of certain restrictions and covenants related to the pledge of equity of certain subsidiaries which remain applicable until after the end of the permitted variations period.Credit.
Senior Notes
The indentures governing the Senior Notes contain customary covenants that limit the Operating Partnership's ability and, in certain circumstances, the ability of its subsidiaries, to borrow money, create liens on assets, make distributions and pay dividends, redeem or repurchase stock, make certain types of investments, sell stock in certain subsidiaries, enter into agreements that restrict dividends or other payments from subsidiaries, enter into transactions with affiliates, issue guarantees of
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indebtedness and sell assets or merge with other companies. These limitations are subject to a number of important exceptions and qualifications set forth in the indentures. In connection with the entry into the 2023 Credit Agreement and the refinancing of the obligations under the prior corporate credit facilities, the collateral securing the Senior Notes was released in full. On and after January 10, 2023, the Senior Notes constitute unsecured obligations.
Debt Covenants
As of September 30, 2022,March 31, 2023, we were not in compliance with itsall debt covenants, current on one mortgageall loan which didpayments and not resultotherwise in an event of default but allowsunder the lender the option to institute a cash sweep until covenant compliance is achieved for a period of time specified in the loan agreement. The cash sweep permits the lender to withdraw excess cash generated by the property into a separate bank account that they control, which may be used to reduce the outstanding loan balance.
Derivatives
As of September 30, 2022, we had four interest rate swaps with an aggregate notional amount of $125.0 million. These swaps fix a portion of the variable interest rate on two of our mortgage loans, for a portion of the term of each respective mortgage loan. Our remaining interest rate swaps expired in October 2022 which increases our exposure to rising interest rates. In addition, two interest rate swaps were terminated in January 2022 in connection with2023 Credit Agreement or the repayment of a $65.0 million mortgage loan.Senior Notes.
Capital Markets
We maintain an established "At-the-Market" ("ATM") program pursuant to an Equity Distribution Agreement ("ATM Agreement") with Wells Fargo Securities, LLC, Robert W. Baird & Co. Incorporated, Jefferies LLC, KeyBanc Capital Markets Inc. and Raymond James & Associates, Inc. In accordance with the terms of the ATM Agreement, which was amended and upsized in May 2021, we may from time to time offer and sell shares of our common stock having an aggregate offering price up to $200 million. No shares were sold under the ATM Agreement during the three and nine months ended September 30, 2022March 31, 2023 and, as of September 30, 2022,March 31, 2023, $200 million of common stock remained available for issuance.
Our Board of Directors has authorized a stock repurchase program pursuant to which we are authorized to purchase(the "Repurchase Program") for up to $175$275 million of our outstanding common stock in the open market, in privately negotiated transactions or otherwise, including pursuant to Rule 10b5-1 plans (the "Repurchase Program").plans. Such repurchases or exchanges, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors. The Repurchase Program does not have an expiration date. This Repurchase Programdate, may be suspended or discontinued at any time and does not obligate us to acquire any particular amount of shares.
During the three and nine months ended September 30, 2022, 120,978March 31, 2023, 1,905,820 shares were repurchased under the Repurchase Program, at a weighted-average price of $15.52$14.03 per share for an aggregate purchase price of $1.9$26.7 million. No shares were purchased as part of the Repurchase Program during the ninethree months ended September 30, 2021.March 31, 2022. As of September 30, 2022,March 31, 2023, we had approximately $92.8$139.7 million remaining under our share repurchase authorization.
The terms of our amended corporate credit facilities prohibited us from making repurchases of our common stock until we achieved compliance with applicable debt covenants, however, these restrictions expired as a result of our exit from the covenant waiver period with the delivery of the compliance certificates under the corporate credit facilities for the fiscal quarter ending June 30, 2022.
Capital Expenditures and Reserve Funds
We maintain each of our properties in good repair and condition and in conformity with applicable laws and regulations, franchise agreements and management agreements. Routine capital expenditures are administered by the hotel management companies. However, we have approval rights over the capital expenditures as part of the annual budget process for each of our properties. From time to time, certain of our hotels may undergo renovations as a result of our decision to expand or upgrade portions of the hotels, such as guest rooms, public space, meeting space and/or restaurants, in order to better compete with other
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hotels in our markets. In addition, upon the acquisition of a hotel we may be required to complete a property improvement plan in order to bring the hotel into compliance with the respective brand standards. If permitted by the terms of the management agreement, funding for a renovation will first come from the FF&E reserves. We are obligated to maintain reserve funds with respect to certain agreements with our hotel management companies, franchisors and lenders to provide funds, generally 3% to 5% of hotel revenues, sufficient to cover the cost of certain capital improvements to the hotels and to periodically replace and update furniture, fixtures and equipment. Certain of the agreements require that we reserve this cash in separate accounts. To the extent that the FF&E reserves are not available or adequate to cover the cost of the renovation, we may fund a portion of the renovation with cash on hand, borrowings from our revolving credit facilityRevolving Line of Credit and/or other sources of available liquidity. We have been, and will continue to be, prudent with respect to our capital spending, taking into account our cash flows from operations.
As of September 30, 2022March 31, 2023 and December 31, 2021,2022, we had a total of $42.7$43.5 million and $29.3$46.3 million, respectively, of FF&E reserves. During the three and nine months ended September 30,March 31, 2023 and 2022 we made total capital expenditures of $18.8$11.6 million and $40.7 million, respectively, and during the three and nine months ended September 30, 2021, we made total capital expenditures of $7.3 million and $19.2$7.5 million, respectively.
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Off-Balance Sheet Arrangements
As of September 30, 2022,March 31, 2023, we had various contracts outstanding with third-parties in connection with the renovation of certain of our hotel properties. The remaining commitments under these contracts as of September 30, 2022March 31, 2023 totaled $10.7$11.0 million.
Sources and Uses of Cash
Our principal sources of cash are cash flows from operations, borrowing under debt financings, including draws on our revolving credit facility,Revolving Line of Credit, and from various types of equity offerings or the sale of our hotels. As a result of the impact the COVID-19 pandemic has had on our business, alongAlong with rising rates of inflation and interest rates and implications of a potential recession and related market impacts, certain sources of capital may not be as readily available to us as they have been historically or may come at higher costs. Our principal uses of cash are asset acquisitions, capital investments, routine debt service and debt repayments, operating costs, corporate expenses and dividends. We may also elect to use cash to buy back our common stock in the future under the Repurchase Program.
Comparison of the NineThree Months Ended September 30, 2022March 31, 2023 to the NineThree Months Ended September 30, 2021March 31, 2022
The table below presents summary cash flow information for the condensed consolidated statements of cash flows (in thousands):
Nine Months Ended September 30,Three Months Ended March 31,
2022202120232022
Net cash provided by operating activitiesNet cash provided by operating activities$157,894 $29,353 Net cash provided by operating activities$30,313 $32,572 
Net cash used in investing activitiesNet cash used in investing activities(330,937)(16,626)Net cash used in investing activities(10,563)(301,092)
Net cash (used in) provided by financing activities(70,515)110,451 
Net (decrease) increase in cash and cash equivalents and restricted cash$(243,558)$123,178 
Net cash used in financing activitiesNet cash used in financing activities(44,300)(66,476)
Net decrease in cash and cash equivalents and restricted cashNet decrease in cash and cash equivalents and restricted cash$(24,550)$(334,996)
Cash and cash equivalents and restricted cash, at beginning of periodCash and cash equivalents and restricted cash, at beginning of period554,231 428,786 Cash and cash equivalents and restricted cash, at beginning of period365,910 554,231 
Cash and cash equivalents and restricted cash, at end of periodCash and cash equivalents and restricted cash, at end of period$310,673 $551,964 Cash and cash equivalents and restricted cash, at end of period$341,360 $219,235 
Operating
Cash provided by operating activities was $157.9$30.3 million and $29.4$32.6 million for the ninethree months ended September 30,March 31, 2023 and 2022, and 2021, respectively. Cash flows from operating activities generally consist of the net cash generated by our hotel operations, partially offset by the cash paid for interest, corporate expenses and other working capital changes. Our cash flows from operating activities may also be affected by changes in our portfolio resulting from hotel acquisitions, dispositions or renovations. The net increasedecrease in cash from operating activities during the ninethree months ended September 30,March 31, 2023 compared to the three months ended March 31, 2022 was primarily due to an increaseincreases in hotel operating income attributed to a recovery from the impact of the COVID-19 pandemicaccounts receivable and the acquisition of W Nashvilleother assets as well as decreases in March 2022, net of reductions from the hotels sold in November 2021accounts payable and January 2022.other liabilities. Refer to the "Results of Operations" section for further discussion of our operating results for the three and nine months ended September 30, 2022March 31, 2023 and 2021.2022.
Investing
Cash used in investing activities was $330.9$10.6 million and $16.6$301.1 million for the ninethree months ended September 30,March 31, 2023 and 2022, and 2021, respectively. Cash used in investing activities for the ninethree months ended September 30,March 31, 2023 was attributed to $11.6 million in capital improvements at our hotel properties, which was partially offset by $1.1 million of performance guaranty payments received that were recorded as a reduction in the respective hotel's cost basis. Cash used in
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investing activities for the three months ended March 31, 2022 was attributed to $328.5 million for the acquisition of W Nashville and $40.7$7.5 million in capital improvements at our hotel properties, which was partially offset by net proceeds of $32.8 million from the disposition of Kimpton Hotel Monaco Chicago, $3.7$1.2 million of proceeds from property insurance and $1.7$0.9 million of performance guaranty payments received that were recorded as a reduction in the respective hotel's cost basis. Cash used in investing activities for the nine months ended September 30, 2021 was attributed to $19.2 million in capital improvements at our hotel properties, which was partially offset by $2.5 million of performance guaranty payments received that were recorded as a reduction in the respective hotel's cost basis.
Financing
Cash used in financing activities was $70.5$44.3 million and cash provided by financing activities was $110.5$66.5 million for the ninethree months ended September 30,March 31, 2023 and 2022, and 2021, respectively. Cash used in financing activities for the ninethree months ended September 30,March 31, 2023 was attributed to the repayment of the existing corporate credit facility term loan maturing in 2024 totaling $125.0 million, the repayment of mortgage debt totaling $99.5 million, the repurchase of common stock totaling $26.7 million, the payment of $11.5 million in dividends, payment of loan fees and issuance costs of $5.6 million, principal payments of mortgage debt totaling $0.9 million and shares redeemed to satisfy tax withholding on vested share-based compensation of $0.6 million, which was partially offset by proceeds from the 2023 Term Loans totaling $225.0 million and proceeds from the amendment of one mortgage loan of $0.4 million. Cash used in financing activities for the three months ended March 31, 2022 was attributed the repayment of mortgage debt totaling $65.0 million, principal payments of mortgage debt totaling $3.1 million, the repurchase of common stock totaling $1.9$0.9 million and shares redeemed to satisfy tax withholding on vested share-based compensation of $0.5 million. Cash provided by financing activities for the nine months ended September 30, 2021 was primarily attributed $500.0 million in proceeds from the
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issuance of the 2021 Senior Notes, offset by the repayment of the revolving credit facility of $163.1 million, the repayment of one corporate credit facility term loan totaling $150.0 million, the repayment of mortgage debt totaling $56.8 million, payment of loan fees and issuance costs of $10.2 million, principal payments of mortgage debt totaling $4.9 million, redemption of Operating Partnership Units for common stock and cash of $4.1 million, and shares redeemed to satisfy tax withholding on vested share-based compensation of $0.4 million.
Non-GAAP Financial Measures
We consider the following non-GAAP financial measures to be useful to investors as key supplemental measures of our operating performance: EBITDA, EBITDAre, Adjusted EBITDAre, FFO and Adjusted FFO. These non-GAAP financial measures should be considered along with, but not as alternatives to, net income or loss, operating profit, cash from operations, or any other operating performance measure as prescribed per GAAP.
EBITDA, EBITDAre and Adjusted EBITDAre
EBITDA is a commonly used measure of performance in many industries and is defined as net income or loss (calculated in accordance with GAAP) excluding interest expense, provision for income taxes (including income taxes applicable to sale of assets) and depreciation and amortization. We consider EBITDA useful to investors in evaluating and facilitating comparisons of our operating performance between periods and between REITs by removing the impact of our capital structure (primarily interest expense) and asset base (primarily depreciation and amortization) from our operating results, even though EBITDA does not represent an amount that accrues directly to common stockholders. In addition, EBITDA is used as one measure in determining the value of hotel acquisitions and dispositions and, along with FFO and Adjusted FFO, is used by management in the annual budget process for compensation programs.
We calculate EBITDAre in accordance with standards established by the National Association of Real Estate Investment Trusts ("Nareit"). Nareit defines EBITDAre as EBITDA plus or minus losses and gains on the disposition of depreciated property, including gains or losses on change of control, plus impairments of depreciated property and of investments in unconsolidated affiliates caused by a decrease in the value of depreciated property in the affiliate, and adjustments to reflect the entity's share of EBITDAre of unconsolidated affiliates.
We further adjust EBITDAre to exclude the impact of non-controlling interests in consolidated entities other than our Operating Partnership Units because our Operating Partnership Units may be redeemed for common stock. We also adjust EBITDAre for certain additional items such as depreciation and amortization related to corporate assets, hotel property acquisition, terminated transaction and pre-opening expenses, amortization of share-based compensation, non-cash ground rent and straight-line rent expense, the cumulative effect of changes in accounting principles, and other costs we believe do not represent recurring operations and are not indicative of the performance of our underlying hotel property entities. We believe it is meaningful for investors to understand Adjusted EBITDAre attributable to all common stock and unit holders. We believe Adjusted EBITDAre attributable to common stock and unit holders provides investors with another useful financial measure in evaluating and facilitating comparison of operating performance between periods and between REITs that report similar measures.
FFO and Adjusted FFO
We calculate FFO in accordance with standards established by Nareit, as amended in the December 2018 restatement white paper,Restatement White Paper, which defines FFO as net income or loss (calculated in accordance with GAAP), excluding real estate-related depreciation, amortization and impairments, gains or losses from sales of real estate, the cumulative effect of changes in accounting principles, similar adjustments for unconsolidated partnerships and consolidated variable interest entities, and items classified by GAAP as extraordinary. Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values instead have historically risen or fallen with market
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conditions, most industry investors consider presentations of operating results for real estate companies that use historical cost accounting to be insufficient by themselves. We believe that the presentation of FFO provides useful supplemental information to investors regarding operating performance by excluding the effect of real estate depreciation and amortization, gains or losses from sales for real estate, impairments of real estate assets, extraordinary items and the portion of these items related to unconsolidated entities, all of which are based on historical cost accounting and which may be of lesser significance in evaluating current performance. We believe that the presentation of FFO can facilitate comparisons of operating performance between periods and between REITs, even though FFO does not represent an amount that accrues directly to common stockholders. Our calculation of FFO may not be comparable to measures calculated by other companies who do not use the Nareit definition of FFO or do not calculate FFO per diluted share in accordance with Nareit guidance. Additionally, FFO may not be helpful when comparing us to non-REITs. We present FFO attributable to common stock and unit holders, which includes our Operating Partnership Units because our Operating Partnership Units may be redeemed for common stock. We believe it is meaningful for the investor to understand FFO attributable to common stock and unit holders.
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We further adjust FFO for certain additional items that are not in Nareit’s definition of FFO such as hotel property acquisition, terminated transaction and pre-opening expenses, amortization of debt origination costs and share-based compensation, non-cash ground rent and straight-line rent expense, and other items we believe do not represent recurring operations. We believe that Adjusted FFO provides investors with useful supplemental information that may facilitate comparisons of ongoing operating performance between periods and between REITs that make similar adjustments to FFO and is beneficial to investors’ complete understanding of our operating performance.
The following is a reconciliation of net income (loss) to EBITDA, EBITDAre and Adjusted EBITDAre attributable to common stock and unit holders for the three and nine months ended September 30,March 31, 2023 and 2022 and 2021 (in thousands):
Three Months Ended September 30,Nine Months Ended September 30,Three Months Ended March 31,
202220212022202120232022
Net income (loss)Net income (loss)$(1,707)$(22,717)$21,294 $(123,437)Net income (loss)$6,553 $(5,477)
Adjustments:Adjustments:Adjustments:
Interest expenseInterest expense20,583 21,358 61,474 59,799 Interest expense22,134 20,538 
Income tax expense (benefit)(1,029)43 4,148 377 
Income tax expenseIncome tax expense5,218 1,607 
Depreciation and amortizationDepreciation and amortization34,311 32,076 99,127 98,281 Depreciation and amortization33,741 30,565 
EBITDA$52,158 $30,760 $186,043 $35,020 
Impairment of investment properties(1)
— 759 — 13,072 
EBITDA and EBITDAreEBITDA and EBITDAre$67,646 $47,233 
EBITDAre$52,158 $31,519 $186,043 $48,092 
Reconciliation to Adjusted EBITDAreReconciliation to Adjusted EBITDAreReconciliation to Adjusted EBITDAre
Depreciation and amortization related to corporate assetsDepreciation and amortization related to corporate assets$(105)$(104)$(311)$(306)Depreciation and amortization related to corporate assets$(73)$(102)
Gain on insurance recoveries(2)(1)
Gain on insurance recoveries(2)(1)
(1,037)— (3,550)— 
Gain on insurance recoveries(2)(1)
— (994)
Loss on extinguishment of debtLoss on extinguishment of debt— — 294 1,356 Loss on extinguishment of debt1,140 294 
Amortization of share-based compensation expenseAmortization of share-based compensation expense2,813 2,875 8,598 8,813 Amortization of share-based compensation expense2,591 2,207 
Non-cash ground rent and straight-line rent expenseNon-cash ground rent and straight-line rent expense33 35 84 Non-cash ground rent and straight-line rent expense(4)16 
Other non-recurring expenses(3)(2)
Other non-recurring expenses(3)(2)
1,068 1,296 1,092 
Other non-recurring expenses(3)(2)
— 1,292 
Adjusted EBITDAre attributable to common stock and unit holdersAdjusted EBITDAre attributable to common stock and unit holders$53,836 $35,391 $192,405 $59,131 Adjusted EBITDAre attributable to common stock and unit holders$71,300 $49,946 
(1)     During the three and nine months ended September 30, 2021, the Company recorded a $0.3 million and $12.6 million impairment loss, respectively, related to Marriott Charleston Town Center, which was attributed to its net book value exceeding the undiscounted cash flows over a shortened hold period. Additionally, during the third quarter of 2021, Loews New Orleans Hotel was impacted by Hurricane Ida and the Company recorded an impairment loss of $0.5 million, which represents the write off of the net book value of property damaged during the storm.
(2)     During the three and nine months ended September 30,March 31, 2022, the Company recordedreceived $1.0 million and $3.6 million, respectively, of insurance proceeds in excess of recognized losses related to damage sustained at Loews New Orleans Hotel during Hurricane Ida inin August 2021. These gainsThis gain on insurance recovery areis included in other income (loss)loss on the condensed consolidated statement of operations and comprehensive income (loss)loss for the periodsperiod then ended.
(3)(2)     During the ninethree months ended September 30,March 31, 2022, the Company recorded hurricane-related repair and cleanup costs of $1.3 million and during the three and nine months ended September 30, 2021, the Company recorded estimated hurricane-related repair and cleanup costs of $1.0 million. These amounts arewhich is included in impairment and other losses on the condensed consolidated statement of operations and comprehensive income (loss)loss for the period then ended.

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The following is a reconciliation of net income (loss) to FFO and Adjusted FFO attributable to common stock and unit holders for the three and nine months ended September 30,March 31, 2023 and 2022 and 2021 (in thousands):
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Three Months Ended September 30,Nine Months Ended September 30,Three Months Ended March 31,
202220212022202120232022
Net income (loss)Net income (loss)$(1,707)$(22,717)$21,294 $(123,437)Net income (loss)$6,553 $(5,477)
Adjustments:Adjustments:Adjustments:
Depreciation and amortization related to investment propertiesDepreciation and amortization related to investment properties34,206 31,972 98,816 97,975 Depreciation and amortization related to investment properties33,668 30,463 
Impairment of investment properties(1)
— 759 — 13,072 
FFO attributable to common stock and unit holdersFFO attributable to common stock and unit holders$32,499 $10,014 $120,110 $(12,390)FFO attributable to common stock and unit holders$40,221 $24,986 
Reconciliation to Adjusted FFOReconciliation to Adjusted FFOReconciliation to Adjusted FFO
Gain on insurance recoveries(2)(1)
Gain on insurance recoveries(2)(1)
$(1,037)$— $(3,550)$— 
Gain on insurance recoveries(2)(1)
$— $(994)
Loss on extinguishment of debtLoss on extinguishment of debt— — 294 1,356 Loss on extinguishment of debt1,140 294 
Loan related costs, net of adjustment related to non-controlling interests(3)(2)
Loan related costs, net of adjustment related to non-controlling interests(3)(2)
1,308 1,291 3,925 4,615 
Loan related costs, net of adjustment related to non-controlling interests(3)(2)
1,282 1,286 
Amortization of share-based compensation expenseAmortization of share-based compensation expense2,813 2,875 8,598 8,813 Amortization of share-based compensation expense2,591 2,207 
Non-cash ground rent and straight-line rent expenseNon-cash ground rent and straight-line rent expense33 35 84 Non-cash ground rent and straight-line rent expense(4)16 
Other non-recurring expenses(4)(3)
Other non-recurring expenses(4)(3)
1,068 1,296 1,092 
Other non-recurring expenses(4)(3)
— 1,292 
Adjusted FFO attributable to common stock and unit holdersAdjusted FFO attributable to common stock and unit holders$35,590 $15,281 $130,708 $3,570 Adjusted FFO attributable to common stock and unit holders$45,230 $29,087 
(1)     During the three and nine months ended September 30, 2021, the Company recorded a $0.3 million and $12.6 million impairment loss, respectively, related to Marriott Charleston Town Center, which was attributed to its net book value exceeding the undiscounted cash flows over a shortened hold period. Additionally, during the third quarter of 2021, Loews New Orleans Hotel was impacted by Hurricane Ida and the Company recorded an impairment loss of $0.5 million, which represents the write off of the net book value of property damaged during the storm.
(2)     During the three and nine months ended September 30,March 31, 2022, the Company recorded received $1.0 million and $3.6 million, respectively, of insurance proceeds in excess of recognized losses related to damagedamaged sustained at Loews New Orleans Hotel during Hurricane Ida in August 2021. These gainsThis gain on insurance recovery areis included in other income (loss)loss on the condensed consolidated statement of operations and comprehensive income (loss)loss for the periodsperiod then ended.
(3)(2)     Loan related costs include amortization of debt premiums, discounts and deferred loan origination costs.
(4)     (3)     During the ninethree months ended September 30,March 31, 2022, the Company recorded hurricane-related repair and cleanup costs of $1.3 million and during the three and nine months ended September 30, 2021, the Company recorded estimated hurricane-related repair and cleanup costs of $1.0 million. These amounts arewhich is included in impairment and other losses on the condensed consolidated statement of operations and comprehensive income (loss)loss for the period then ended.
Use and Limitations of Non-GAAP Financial Measures
EBITDA, EBITDAre, Adjusted EBITDAre, FFO, and Adjusted FFO do not represent cash generated from operating activities under GAAP and should not be considered as alternatives to net income or loss, operating profit, cash flows from operations or any other operating performance measure prescribed by GAAP. Although we present and use EBITDA, EBITDAre, Adjusted EBITDAre, FFO and Adjusted FFO because we believe they are useful to investors in evaluating and facilitating comparisons of our operating performance between periods and between REITs that report similar measures, the use of these non-GAAP measures has certain limitations as analytical tools. These non-GAAP financial measures are not measures of our liquidity, nor are they indicative of funds available to meet our cash needs, including our ability to fund capital expenditures, contractual commitments, working capital, service debt or make cash distributions. These measurements do not reflect cash expenditures for long-term assets and other items that we have incurred and will incur. These non-GAAP financial measures may include funds that may not be available for discretionary use due to functional requirements to conserve funds for capital expenditures, property acquisitions, and other commitments and uncertainties. These non-GAAP financial measures as presented may not be comparable to non-GAAP financial measures as calculated by other real estate companies.
We compensate for these limitations by separately considering the impact of the excluded items to the extent they are material to operating decisions or assessments of our operating performance. Our reconciliations to the most comparable GAAP financial measures, and our condensed consolidated statements of operations and comprehensive income (loss), include interest expense, and other excluded items, all of which should be considered when evaluating our performance, as well as the usefulness of our non-GAAP financial measures. These non-GAAP financial measures reflect additional ways of viewing our operations that we believe, when viewed with our GAAP results and the reconciliations to the corresponding GAAP financial measures, provide a more complete understanding of factors and trends affecting our business than could be obtained absent this disclosure. We strongly encourage investors to review our financial information in its entirety and not to rely on a single financial measure.
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Critical Accounting Policies and Estimates
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities at the date of our financial statements and the reported amounts of revenues and expenses during the reporting period. Actual amounts may differ significantly from these estimates
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and assumptions. We evaluate our estimates, assumptions and judgments to confirm that they are reasonable and appropriate on an ongoing basis, based on information that is then available to us as well as our experience relating to various matters. All of our significant accounting policies, including certain critical accounting policies, are disclosed in our Annual Report on Form 10-K for the year ended December 31, 20212022 and Note 2 in the accompanying condensed consolidated financial statements included herein.
Seasonality
Demand in the lodging industry is affected by recurring seasonal patterns, which are greatly influenced by overall economic cycles, the geographic locations of the hotels and the customer mix at the hotels. The impact of the COVID-19 pandemic and continuing recovery has and may continue to disrupt our historical seasonal patterns.
Subsequent Events
In April and May 2023, 1,175,286 shares were repurchased under the Repurchase Program, at a weighted-average price of $12.75 per share for an aggregate purchase price of $15.0 million.
New Accounting Pronouncements Not Yet Implemented
See Note 2 in the accompanying condensed consolidated financial statements included herein for additional information related to recently issued accounting pronouncements.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
We are subject to market risk associated with changes in interest rates both in terms of variable rate debt and the price of new fixed rate debt upon maturity of existing debt and for acquisitions. Our exposure to market risk has not materially changed from what we previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2021.2022.
Our interest rate risk management objectives are to limit the impact of interest rate changes on earnings and cash flows and to lower our overall borrowing costs. If market rates of interest on all of our variable rate debt as of September 30,March 31, 2023 permanently increased or decreased by 1%, the increase or decrease in interest expense on our variable rate debt would decrease or increase future earnings and cash flows by approximately $2.8 million per annum. If market rates of interest on all of our variable rate debt as of December 31, 2022 permanently increased or decreased by 1%, the increase or decrease in interest expense on our variable rate debt would decrease or increase future earnings and cash flows by approximately $1.5 million per annum. If market rates of interest on all of our variable rate debt as of December 31, 2021 permanently increased or decreased by 1%, the increase or decrease in interest expense on our variable rate debt would decrease or increase future earnings and cash flows by approximately $0.3$2.8 million per annum.
With regard to our variable rate financing, we assess interest rate cash flow risk by continually identifying and monitoring changes in interest rate exposures that may adversely impact expected future cash flows and by evaluating hedging opportunities. We maintain risk management control systems to monitor interest rate cash flow risk attributable to both of our outstanding or forecasted debt obligations as well as our potential offsetting hedge positions. The risk management control systems involve the use of analytical techniques, including cash flow sensitivity analysis, to estimate the expected impact of changes in interest rates on our future cash flows.
We monitor interest rate risk using a variety of techniques, including periodically evaluating fixed interest rate quotes on all variable rate debt and the costs associated with converting the debt to fixed rate debt. Also, existing fixed and variable rate loans that are scheduled to mature in the next two yearsnear term are evaluated for possible early refinancing or extension due to consideration given to current interest rates. We have taken significant steps to reducein reducing our variable rate debt exposure by paying off property-level mortgage debt subject to floating rates. In the past, we have used and, entering into variousmay in the future, use interest rate swap agreementshedges to hedge the interest rate exposure risk related to several variable rate loans. Our interest rate swaps expired in October 2022 which increasesmanage our exposure to rising interest rates. Refer to Note 5 in the accompanying condensed consolidated financial statements included herein, for our debt principal amounts and weighted-average interest rates by year and expected maturity to evaluate the expected cash flows and sensitivity to interest rate changes. Refer to Note 6
We may in the accompanying condensed consolidated financial statements for more information on our interest rate swap derivatives.
We mayfuture use derivative instruments to hedge exposures to changes in interest rates on loans secured by our properties. To the extent we do, we are exposed to credit risk and market risk. Credit risk is the failure of the counterparty to perform under the terms of the derivative contract. We maintain credit policies with regard to our counterparties that we believe reduce overall credit risk. These policies include evaluating and monitoring our counterparties' financial condition, including their credit ratings, and entering into agreements with counterparties based on established credit limit policies. Market risk is the adverse effect on the value of a financial instrument that results from a change in interest rates. The market risk associated with interest rate contracts is managed by establishing and monitoring parameters that limit the types and degree of market risk that may be undertaken.
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The following table provides information about our financial instruments that are sensitive to changes in interest rates. For debt obligations outstanding as of September 30, 2022,March 31, 2023, the following table presents principal repayments and related weighted-average interest rates by contractual maturity dates (in thousands):
20222023202420252026ThereafterTotalFair Value20232024202520262027ThereafterTotalFair Value
Maturing debt(1):
Maturing debt(1):
Maturing debt(1):
Fixed rate debt(2)
$1,086 $4,457 $126,795 $503,512 $54,380 $601,386 $1,291,616 $1,176,754 
Fixed rate debtFixed rate debt$2,417 $3,355 $503,512 $54,380 $101,386 $500,000 $1,165,050 $1,082,484 
Variable rate debtVariable rate debt270 1,080 153,480 — — — 154,830 151,191 Variable rate debt— — 772 225,691 667 52,870 280,000 282,121 
TotalTotal$1,356 $5,537 $280,275 $503,512 $54,380 $601,386 $1,446,446 $1,327,945 Total$2,417 $3,355 $504,284 $280,071 $102,053 $552,870 $1,445,050 $1,364,605 
Weighted-average interest rate on debt:Weighted-average interest rate on debt:Weighted-average interest rate on debt:
Fixed rate debt(2)
4.55%4.55%4.41%6.36%4.53%4.83%5.36%6.08%
Fixed rate debtFixed rate debt4.59%4.59%6.36%4.53%4.63%4.88%5.48%5.88%
Variable rate debtVariable rate debt5.04%5.04%4.57%—%—%—%4.58%7.07%Variable rate debt—%—%7.34%6.59%7.34%7.34%6.74%5.50%
(1)    Excludes net mortgage loan premiums, discounts and unamortized deferred loan costs. See Item 7A of our most recent Annual Report on Form 10-K and Note 5 in the accompanying condensed consolidated financial statements included herein.
(2)    Includes all fixed rate debt and all variable rate debt that was swapped to fixed rates as of September 30, 2022.
Item 4. Controls and Procedures
Disclosure Controls and Procedures. As required by Rules 13a-15(b) and 15d-15(b) under the Exchange Act, our management, including our principal executive officer and our principal financial officer evaluated, as of the end of the period covered by this quarterly report, the effectiveness of our disclosure controls and procedures as defined in Rules 13a-15(e) and Rule 15d-15(e) of the Exchange Act. Based on that evaluation, our principal executive officer and our principal financial officer concluded that our disclosure controls and procedures, as of the end of the period covered by this quarterly report, were effective at a reasonable assurance level for the purpose of ensuring that information required to be disclosed by us in this quarterly report is recorded, processed, summarized and reported within the time periods specified by the rules and forms of the Exchange Act and is accumulated and communicated to management, including our principal executive officer and our principal financial officer as appropriate, to allow timely decisions regarding required disclosures.
Changes in Internal Control Over Financial Reporting. There has been no change in the Company's internal control over financial reporting during the Company's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.
Part II. OTHER INFORMATION
Item 1. Legal Proceedings
We are involved in various claims and lawsuits arising in the normal course of business, including proceedings involving tort and other general liability claims, related to our ownership of hotel properties. Most occurrences involving liability are covered by insurance with solvent insurance carriers. We recognize a liability when we believe a loss is probable and reasonably estimable. We currently believe that the ultimate outcome of any such lawsuits and proceedings will not, individually or in the aggregate, have a material effect on our consolidated financial position, results of operations, or liquidity.
Item 1A. Risk Factors
None.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
None.
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Issuer Purchases of Equity Securities
The following table sets forth information regarding the Company's purchases of shares of its common stock pursuant to its Share Repurchase Program during the period ended September 30, 2022:March 31, 2023:
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PeriodTotal Number of Shares PurchasedWeighted- Average Price Paid Per ShareTotal Numbers of Shares Purchased as Part of Publicly Announced PlansMaximum Number (or Approximate Dollar Value) of Shares That May Yet Be Purchased Under the Program (in thousands)
July 1 to July 31, 2022— $— — $94,657 
August 1 to August 31, 2022— $— — $94,657 
September 1 to September 31, 2022120,978 $15.52 120,978 $92,779 
Total120,978 $15.52 120,978 
PeriodTotal Number of Shares PurchasedWeighted- Average Price Paid Per ShareTotal Numbers of Shares Purchased as Part of Publicly Announced PlansMaximum Number (or Approximate Dollar Value) of Shares That May Yet Be Purchased Under the Program (in thousands)
January 1 to January 31, 2023332,241 $14.16 332,241 $161,753 
February 1 to February 28, 2023706,302 $14.22 706,302 $151,711 
March 1 to March 31, 2023867,277 $13.84 867,277 $139,711 
Total1,905,820 $14.03 1,905,820 

Item 3. Defaults Upon Senior Securities
None.
Item 4. Mine Safety Disclosures
Not applicable.
Item 5. Other Information
On and effective as of October 31, 2022, our Board of Directors adopted the Third Amended and Restated Bylaws (the "Bylaws") to, among other things:
Enhance procedural mechanics and disclosure requirements in connection with stockholder nominations of directors made in connection with annual and special meetings of stockholders, including, without limitation, as follows:

Addressing matters relating to Rule 14a-19 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) (e.g., by clarifying that (i) the Company will disregard any proxy authority granted in favor of (or voted in favor of) nominees submitted by stockholders if the stockholder does not comply with Rule 14a-19; and (ii) stockholders must also comply with the requirements to provide notices required under Rule 14a-19 in timely manner and deliver reasonable evidence Rule 14a-19 requirements have been met);

Requiring proposed nominees to provide certain certifications to the Company, including that the proposed nominee agrees to serve on the Board if elected and will notify that Company if the proposed nominee becomes unwilling or unable to serve; and

Prohibiting a stockholder from nominating more individuals than there are directors to be elected and prohibiting the substitution or replacement of a proposed nominee following the expiration of the applicable deadline

Make various other updates to the provisions governing stockholder meetings.

The foregoing summary of the Bylaws does not purport to be complete and is qualified in its entirety by reference to the full text of the Bylaws, as amended, a copy of which is filed as Exhibit 3.6 to this Quarterly Report on Form 10-Q and incorporated herein by reference.None.
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Item 6. Exhibits
Exhibit NumberExhibit Description
Purchase and Sale Agreement dated as of February 25, 2022, among Nashville Gulch Hotel LLC and XHR Acquisitions, LLC (incorporated by reference to Exhibit 2.1 to the Company’s Quarterly Report on Form 10-Q (File No. 001-36594) filed on May 3, 2022)
Articles of Restatement of Xenia Hotels & Resorts, Inc., as filed on November 10, 2015 with the Maryland Department of Assessments and Taxation (incorporated by reference to Exhibit 3.2 to the Company’s Quarterly Report on Form 10-Q (File No. 001-36594) filed on November 12, 2015)
Articles Supplementary of Xenia Hotels and Resorts, Inc., as filed on November 10, 2015 with the Maryland Department of Assessments and Taxation (incorporated by reference to Exhibit 3.1 to the Company’s Quarterly Report on Form 10-Q (File No. 001-36594) filed on November 12, 2015)
Articles Supplementary of Xenia Hotels and Resorts, Inc., as filed on March 15, 2017 with the Maryland Department of Assessments and Taxation (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K (File No. 001-36594) filed on March 15, 2017)
Articles of Amendment of Xenia Hotels and Resorts, Inc., as filed on May 22, 2018 with the Maryland Department of Assessments and Taxation (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K (File No. 001-36594) filed on May 23, 2018)
Articles Supplementary of Xenia Hotels and Resorts, Inc., as filed on May 22, 2018 with the Maryland Department of Assessments and Taxation (incorporated by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K (File No. 001-36594) filed on May 23, 2018)
Third Amended and Restated Bylaws of Xenia Hotels & Resorts, Inc. (incorporated by reference to Exhibit 3.6 to the Company's Quarterly Report on Form 10-Q (file No. 001-36594) filed on November 2, 2022)
Third Amended and Restated Bylaws of Xenia Hotels & Resorts, Inc.
Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INSXBRL 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
101.CAL*Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF*Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE*Inline XBRL Taxonomy Extension Presentation Linkbase Document
104Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
*    Filed herewith
+    Schedules and exhibits have been omitted pursuant to Item 601(b)(2) of Regulation S-K. The Company hereby agrees to furnish supplementally copies of any of the omitted schedules and exhibits upon request by the Securities and Exchange Commission; provided, however, that the Company may request confidential treatment pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended, for any schedule or exhibit so furnished.
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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.
Xenia Hotels & Resorts, Inc.
 
November 2, 2022May 3, 2023
 
 
/s/ MARCEL VERBAAS
Marcel Verbaas
Chairman and Chief Executive Officer
(Principal Executive Officer)
 
 
/s/ ATISH SHAH
Atish Shah
Executive Vice President, Chief Financial Officer and Treasurer
(Principal Financial Officer)
/s/ JOSEPH T. JOHNSON
Joseph T. Johnson
Senior Vice President and Chief Accounting Officer
(Principal Accounting Officer)

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