 | | |
| HERSHA HOSPITALITY TRUST | | |
| | 510 Walnut Street, 9th Floor |
| | Philadelphia, PA 19016 |
| | Phone: 215-238-1046 |
| | Fax: 215-238-0157www.hersha.com |
For Immediate Release
| Contact: | Ashish Parikh, CFO |
Ph: (215) 238-1046
HERSHA HOSPITALITY ANNOUNCES
FOURTH QUARTER 2007 EARNINGS
Year-over-Year Fourth Quarter 2007
| · | Adjusted FFO (“AFFO”) Increased 47.1% to $0.25 Per Diluted Share/Unit |
| · | Consolidated RevPAR Grew 17.2% |
| · | Consolidated Hotel EBITDA Improved 60.3% to $21.0 Million |
| · | Consolidated Same Store RevPAR Grew 12.2% |
| · | Initial 2008 AFFO Guidance of $1.27 to $1.30 Per Share /Unit |
PHILADELPHIA, PA--(Business Wire)—February 27, 2008-- Hersha Hospitality Trust (AMEX: HT) owner of nationally franchised premium full service and limited service hotels, today announced earnings for the fourth quarter and full year ended December 31, 2007.
Financial Highlights for the Fourth Quarter 2007
Strong hotel revenue and increased profitability along with growth in Hersha’s development loan program resulted in a significant increase in net income applicable to common shareholders. For the fourth quarter of 2007, net income applicable to common shareholders increased to $4.6 million, or $0.11 per common share, from a net loss of ($1.4) million, or ($0.04) per common share for the fourth quarter of 2006. Fourth quarter 2007 results include a gain on the disposition of two hotel assets of approximately $3.7 million, or $0.09 per common share. The fourth quarter results also include an expense for accrued 2007 incentive compensation totaling approximately $0.02 per common share. In prior years, incentive compensation was determined and recorded in the first quarter after the end of each fiscal year.
Operating income for the fourth quarter ended December 31, 2007 grew 75.0% to $11.9 million from $6.8 million for the same period in 2006. The growth in operating income was a result of Hersha’s larger portfolio, increased operating margins from rate-led hotel revenue growth and improved expense efficiency.
Adjusted funds from operations (AFFO) for the fourth quarter of 2007 increased 47.1% to $0.25 per diluted common share and unit from $0.17 per diluted common share and unit for the same quarter of 2006. A reconciliation of AFFO to net income applicable to common shares, the most directly applicable U.S. GAAP measure, is included at the end of this release.
Mr. Jay H. Shah, Chief Executive Officer, commented, “Our 2007 performance was very strong. The significant internal growth from both our stabilized and newer hotels contributed to our 16.1% revenue per available room (RevPAR) growth and 24.7% increase in AFFO for the year. On a geographic basis, our properties in metro-New York City, metro-Boston and metro-Washington, D.C. compared very well to their markets achieving RevPAR growth of 28.4%, 20.6% and 18.6%, respectively, compared to industry estimates of 13.5%, 18.6% and 7.4%, respectively for those same markets during the fourth quarter. We slowed the pace of our external growth by purchasing seven hotels into the portfolio in 2007 as compared to 44 hotels in the previous two years. As we discussed in the first half of the year, we purposefully shifted our primary focus to internal growth and asset management in order to drive our portfolio RevPAR and hotel profitability. Our fourth quarter and full year 2007 revenue growth and positive operating leverage demonstrates what we expect to be a continued priority in the years ahead.”
For the three-month period ended December 31, 2007, consolidated total hotel operating revenues increased 52.9% to $57.5 million from $37.6 million in the fourth quarter of 2006. This increase was primarily driven by our growth in same-store room revenues and revenue contributions from acquisitions completed in prior periods. RevPAR for the Company’s consolidated hotels (55 hotels) increased 17.2% on a year-over-year basis to $94.46, which was driven by an average daily rate (ADR) increase of 15.3% to $136.93 and an improvement in occupancy, which grew 111 basis points to 68.98% as compared to 67.87% for the fourth quarter of 2006.
Hotel Earnings before interest, taxes, depreciation and amortization (Hotel EBITDA) for Hersha’s consolidated hotels grew 60.3% to $21.0 million for the fourth quarter of 2007 compared to the fourth quarter of 2006. Hotel EBITDA margins for the quarter increased 151 basis points to 36.3% for the Company’s consolidated hotel portfolio. Hotel EBITDA margins improved as a result of growth in ADR and expense control measures successfully implemented by our asset managers.
On a same-store basis for Hersha’s consolidated hotels (42 hotels), RevPAR for the fourth quarter of 2007 increased 12.2% on a year-over-year basis to $90.42, which was driven by an 11.3% increase in ADR to $132.17 and 54 basis points of improvement in occupancy, which increased to 68.41% from 67.87%. Same-store Hotel EBITDA for the fourth quarter of 2007 increased 18.4% to $14.8 million. The Company’s same-store Hotel EBITDA margin improved 190 basis points to 35.2% for the fourth quarter of 2007, as compared to the fourth quarter of 2006.
Other Highlights
| | v | At the end of November, 2007, the Company completed the sale of the 118-room Fairfield Inn located in Mt. Laurel, New Jersey and the 149-room Hampton Inn located in Linden, New Jersey at an approximate 7.0% blended capitalization rate. |
Subsequent Events
| | v | In January, 2008, the Company completed the purchase of the 45-room independent boutique hotel, the Duane Street Hotel in the Tribeca section of New York City for $24.75 million. The purchase price included $2.0 million in cash, the assumption of $15.0 million of fixed rate debt and the issuance of units of limited partnership interest in Hersha Hospitality Limited Partnership, our operating subsidiary, valued at approximately $7.75 million. |
| | v | Separately, in January, 2008, Hersha purchased a 93-room independent upscale hotel development project at 75 Smith Street in Brooklyn, New York for $17.24 million from Atlantic Court, LLC. The mixed-used project also contains 50 residential units, 2 ground level retail units, a community unit and a garage unit that are separately owned by unrelated entities. The independent boutique hotel, which will be named the “Nu Hotel”, is expected to be open by the end of the third quarter of 2008. |
Balance Sheet
The Company ended the fourth quarter of 2007 with $58.2 million in development loans and $23.4 million in land leases outstanding to 11 hotel development projects. During the fourth quarter of 2007, Lehman Brothers acquired one of Hersha’s $15.0 million development loans, at par, and the Company also received a $2.0 million repayment on another loan. The Company also made an additional loan of $5 million for an existing Manhattan, New York hotel project.
At December 31, 2007, Hersha Hospitality Trust had approximately $663.0 million of total consolidated debt outstanding, which included approximately $51.5 million of trust preferred securities and $43.7 million outstanding on the Company’s line of credit. Fixed rate debt, including variable rate debt fixed by an interest rate swap, amounted to approximately 89.3% of total consolidated debt. The weighted average interest rate on all of the Company’s fixed rate debt was approximately 6.19% for the fourth quarter of 2007. The weighted average life to maturity of the Company’s debt was 8.2 years. Total common shares and units of limited partnership interest of Hersha Hospitality Limited Partnership outstanding at December 31, 2007 were 47.6 million.
“During the fourth quarter of 2007, we continued to execute our plan to reduce our consolidated debt. In the fourth quarter, we repaid a total of $46.3 million in debt, including amounts reduced as a result of the sale of two of the Company’s hotels. We feel comfortable with our strategy of how our assets are financed given our significant percentage of fixed rate debt and favorable maturity schedule,” noted Mr. Shah.
Dividend
For the fourth quarter of 2007, Hersha Hospitality Trust declared common share and limited partnership unit dividends of $0.18 per common share and unit. Hersha’s annualized dividend of $0.72 per common share is approximately 71% of the Company’s AFFO less maintenance capital expenditures for the fiscal year ending December 31, 2007. The Board of Trustees also declared a fourth quarter cash dividend of $0.50 per Series A Preferred Share.
Initial Financial Outlook for 2008
The Company concurs with the consensus forecast that economic growth in the U.S. may slow significantly compared to the levels achieved in 2007. Assuming an environment of more modest U.S. economic growth, and no material increases in the supply of available rooms in its markets, the Company anticipates that its current portfolio is expected to post another year of AFFO growth for the full year ended December 31, 2008 as compared to the full year ended December 31, 2007.
The Company’s initial financial guidance and underlying assumptions for the full year ended December 31, 2008 are as follows:
| | Guidance |
Consolidated same-store RevPAR growth compared to the full year 2007 | 4.0% to 5.0% |
Consolidated portfolio RevPAR growth compared to the full year 2007 | 5.0% to 6.0% |
Net income available to common shareholders | $13.0 to $14.5 million |
Adjusted EBITDA | $119.1 to $121.0 million |
| AFFO per share | $1.27 to $1.30 |
Fourth Quarter 2007 Earnings Conference Call
The Company will host a conference call to discuss its financial results tomorrow, Thursday, February 28, 2008 at 9:30 AM Eastern time. Hosting the call will be Mr. Jay H. Shah, Chief Executive Officer, Mr. Neil H. Shah, President and Chief Operating Officer, and Mr. Ashish Parikh, Chief Financial Officer.
The live conference call can be accessed by dialing (877) 704-5381 or (913) 981-5526 for international participants. A replay of the call will be available from 12:30 PM Eastern time on February 28, 2008, through midnight Eastern time on March 13, 2008. The replay can be accessed by dialing (888) 203-1112 or (719) 457-0820 for international participants. The passcode for the call and the replay is 6371884.
About Hersha Hospitality
Hersha Hospitality Trust is a self-advised real estate investment trust, which owns interests in 73 hotels, totaling 9,267 rooms, primarily along the Northeast Corridor from Boston to Washington DC. The Company also owns hotels in Northern California and Scottsdale, Arizona. Hersha focuses on high quality upscale hotels in high barrier to entry markets. More information on the Company and its portfolio of hotels is available on Hersha’s Web site at http://www.hersha.com.
Forward Looking Statement
Certain matters within this press release are discussed using forward-looking language as specified in the Private Securities Litigation Reform Act of 1995, and, as such, may involve known and unknown risks, uncertainties and other factors that may cause the actual results or performance to differ from those projected in the forward-looking statement. For a description of these factors, please review the information under the heading “Risk Factors” included in our Annual Report on Form 10-K for the year ended December 31, 2006, filed with the Securities Exchange Commission (SEC).
HERSHA HOSPITALITY TRUST
Balance Sheet
(in thousands, except shares and per share data)
| | | December 31, 2007 | | | December 31, 2006 | |
| Assets: | | | | | | |
| Investment in Hotel Properties, net of Accumulated Depreciation | | $ | 893,297 | | | $ | 807,784 | |
| Investment in Joint Ventures | | | 51,851 | | | | 50,234 | |
| Development Loans Receivable | | | 58,183 | | | | 47,016 | |
| Cash and Cash Equivalents | | | 12,327 | | | | 10,316 | |
| Escrow Deposits | | | 13,706 | | | | 14,927 | |
| Hotel Accounts Receivable, net of allowance for doubtful accounts of $47 and $30 | | | 7,165 | | | | 4,608 | |
| Deferred Costs, net of Accumulated Amortization of $3,252 and $1,543 | | | 8,048 | | | | 7,525 | |
| Due from Related Parties | | | 1,256 | | | | 4,930 | |
| Intangible Assets, net of Accumulated Amortization of $764 and $618 | | | 5,619 | | | | 5,594 | |
| Other Assets | | | 16,155 | | | | 15,274 | |
| | | | | | | | | |
| Total Assets | | $ | 1,067,607 | | | $ | 968,208 | |
| | | | | | | | | |
| Liabilities and Shareholders’ Equity: | | | | | | | | |
| Line of Credit | | $ | 43,700 | | | $ | 24,000 | |
| Mortgages and Notes Payable, net of unamortized discount of $72 and $1,312 | | | 619,308 | | | | 556,542 | |
| Accounts Payable, Accrued Expenses and Other Liabilities | | | 17,728 | | | | 14,740 | |
| Dividends and Distributions Payable | | | 9,688 | | | | 8,985 | |
| Due to Related Parties | | | 2,025 | | | | 3,297 | |
| | | | | | | | | |
| Total Liabilities | | | 692,449 | | | | 607,564 | |
| | | | | | | | | |
| Minority Interests: | | | | | | | | |
| Common Units | | $ | 42,845 | | | $ | 25,933 | |
| Interest in Consolidated Joint Ventures | | | 1,908 | | | | 3,092 | |
| | | | | | | | | |
| Total Minority Interests | | | 44,753 | | | | 29,025 | |
| | | | | | | | | |
| Shareholders' Equity: | | | | | | | | |
| Preferred Shares - 8% Series A, $.01 Par Value, 29,000,000 and 10,000,000 Shares Authorized at December 31, 2007 and 2006, 2,400,000 Shares Issued and Outstanding at December 31, 2007 and 2006 (Aggregate Liquidation Preference $60,000 at December 30, 2007 and 2006) | | | 24 | | | | 24 | |
| Common Shares - Class A, $.01 Par Value, 80,000,000 and 50,000,000 Shares Authorized at December 2007 and 2006, 41,203,612 and 40,671,950 Shares Issued and Outstanding at December 31, 2007 and 2006 | | | 412 | | | | 405 | |
| Common Shares - Class B, $.01 Par Value, 1,000,000 and 50,000,000 Shares Authorized at December 31, 2007 and 2006 None Issued and Outstanding | | | - | | | | - | |
| Accumulated Other Comprehensive Income | | | (23 | ) | | | 233 | |
| Additional Paid-in Capital | | | 397,127 | | | | 381,592 | |
| Distributions in Excess of Net Income | | | (67,135 | ) | | | (50,635 | ) |
| | | | | | | | | |
| Total Shareholders' Equity | | | 330,405 | | | | 331,619 | |
| | | | | | | | | |
| Total Liabilities and Shareholders’ Equity | | $ | 1,067,607 | | | $ | 968,208 | |
HERSHA HOSPITALITY TRUST
Summary Results
(in thousands, except shares and per share data)
| | | Three Months Ended | | | Year Ended | |
| | | December 31, 2007 | | | December 31, 2006 | | | December 31, 2007 | | | December 31, 2006 | |
| Revenues: | | | | | | | | | | | | |
| Hotel Operating Revenues | | $ | 57,478 | | | $ | 37,581 | | | $ | 229,462 | | | $ | 135,274 | |
| Interest Income from Development Loans | | | 2,033 | | | | 925 | | | | 6,046 | | | | 2,487 | |
| Land Lease Revenue | | | 1,331 | | | | 1,663 | | | | 4,860 | | | | 2,071 | |
| Hotel Lease Revenue | | | 195 | | | | 254 | | | | 781 | | | | 391 | |
| Other Revenue | | | 387 | | | | 182 | | | | 980 | | | | 737 | |
| Total Revenues | | | 61,424 | | | | 40,605 | | | | 242,129 | | | | 140,960 | |
| | | | | | | | | | | | | | | | | |
| Expenses: | | | | | | | | | | | | | | | | |
| Hotel Operating Expenses | | | 33,577 | | | | 22,466 | | | | 130,925 | | | | 79,430 | |
| Hotel Ground Rent | | | 206 | | | | 204 | | | | 856 | | | | 804 | |
| Land Lease Expense | | | 747 | | | | 1,189 | | | | 2,721 | | | | 1,189 | |
| Real Estate and Personal Property Taxes and Property Insurance | | | 3,073 | | | | 1,938 | | | | 11,426 | | | | 6,089 | |
| General and Administrative | | | 2,664 | | | | 1,912 | | | | 8,185 | | | | 6,238 | |
| Depreciation and Amortization | | | 9,213 | | | | 6,060 | | | | 34,336 | | | | 18,954 | |
| Total Operating Expenses | | | 49,480 | | | | 33,769 | | | | 188,449 | | | | 112,704 | |
| | | | | | | | | | | | | | | | | |
| Operating Income | | | 11,944 | | | | 6,836 | | | | 53,680 | | | | 28,256 | |
| | | | | | | �� | | | | | | | | | | |
| Interest Income | | | 96 | | | | 259 | | | | 686 | | | | 1,182 | |
| Interest Expense | | | 10,988 | | | | 7,746 | | | | 42,402 | | | | 25,423 | |
| Loss on Debt Extinguishment | | | - | | | | 322 | | | | - | | | | 1,485 | |
| Income (Loss) before income from Unconsolidated Joint Venture Investments, Minority Interests and Discontinued Operations | | | 1,052 | | | | (973 | ) | | | 11,964 | | | | 2,530 | |
| | | | | | | | | | | | | | | | | |
| Income from Unconsolidated Joint Venture Investments | | | 893 | | | | 367 | | | | 3,476 | | | | 1,799 | |
| | | | | | | | | | | | | | | | | |
| Income (Loss) before Minority Interests and Discontinued Operations | | | 1,945 | | | | (606 | ) | | | 15,440 | | | | 4,329 | |
| | | | | | | | | | | | | | | | | |
| Income allocated to Minority Interest in Continuing Operations | | | 210 | | | | 11 | | | | 1,765 | | | | 536 | |
| Income from Continuing Operations | | | 1,735 | | | | (617 | ) | | | 13,675 | | | | 3,793 | |
| | | | | | | | | | | | | | | | | |
| Discontinued Operations | | | | | | | | | | | | | | | | |
| Gain on Disposition of Hotel Properties | | | 3,745 | | | | 257 | | | | 3,745 | | | | 693 | |
| Income from Discontinued Operations | | | 314 | | | | 186 | | | | 427 | | | | 612 | |
| Income from Discontinued Operations | | | 4,059 | | | | 443 | | | | 4,172 | | | | 1,305 | |
| | | | | | | | | | | | | | | | | |
| Net Income (Loss) | | | 5,794 | | | | (174 | ) | | | 17,847 | | | | 5,098 | |
| Preferred Distributions | | | 1,200 | | | | 1,200 | | | | 4,800 | | | | 4,800 | |
| | | | | | | | | | | | | | | | | |
| Net Income (Loss) applicable to Common Shareholders | | $ | 4,594 | | | $ | (1,374 | ) | | $ | 13,047 | | | $ | 298 | |
| | | | | | | | | | | | | | | | | |
| Basic earnings per share | | | | | | | | | | | | | | | | |
| Income (Loss) from continuing operations applicable to common shareholders | | $ | 0.01 | | | $ | (0.05 | ) | | $ | 0.22 | | | $ | (0.04 | ) |
| Discontinued Operations | | | 0.10 | | | | 0.01 | | �� | | 0.10 | | | | 0.05 | |
| | | | | | | | | | | | | | | | | |
| Net Income (Loss) applicable to common shareholders | | $ | 0.11 | | | $ | (0.04 | ) | | $ | 0.32 | | | $ | 0.01 | |
| | | | | | | | | | | | | | | | | |
| Diluted earnings per share | | | | | | | | | | | | | | | | |
| Income (Loss) from continuing operations applicable to common shareholders | | $ | 0.01 | | | $ | (0.05 | ) | | $ | 0.22 | | | $ | (0.04 | ) |
| Discontinued Operations | | | 0.10 | | | | 0.01 | | | | 0.10 | | | | 0.05 | |
| | | | | | | | | | | | | | | | | |
| Net Income (Loss) applicable to common shareholders | | $ | 0.11 | | | $ | (0.04 | ) | | $ | 0.32 | | | $ | 0.01 | |
| | | | | | | | | | | | | | | | | |
| Weighted Average Common Shares Outstanding | | | | | | | | | | | | | | | | |
| Basic | | | 40,882,090 | | | | 34,115,606 | | | | 40,718,724 | | | | 27,118,264 | |
| Diluted | | | 40,882,685 | | | | 34,115,606 | | | | 40,718,724 | | | | 27,118,264 | |
FFO and GAAP Reconciliation
The National Association of Real Estate Investment Trusts (“NAREIT”) developed Funds from Operations (“FFO”) as a non-GAAP financial measure of performance of an equity REIT in order to recognize that income-producing real estate historically has not depreciated on the basis determined under GAAP. We calculate FFO applicable to common shares and Partnership units in accordance with the April 2002 National Policy Bulletin of NAREIT, which we refer to as the White Paper. The White Paper defines FFO as net income (loss) (computed in accordance with GAAP) excluding extraordinary items as defined under GAAP and gains or losses from sales of previously depreciated assets, plus certain non-cash items, such as depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Our interpretation of the NAREIT definition is that minority interest in net income (loss) should be added back to (deducted from) net income (loss) as part of reconciling net income (loss) to FFO. Our FFO computation may not be comparable to FFO reported by other REITs that do not compute FFO in accordance with the NAREIT definition, or that interpret the NAREIT definition differently than we do.
The GAAP measure that we believe to be most directly comparable to FFO, net income (loss) applicable to common shares, includes depreciation and amortization expenses, gains or losses on property sales and minority interest. In computing FFO, we eliminate these items because, in our view, they are not indicative of the results from our property operations.
Hersha also presents Adjusted Funds from Operations (AFFO), which reflects FFO in accordance with the NAREIT definition further adjusted by:
| | · | adding back write-offs of deferred financing costs on debt extinguishment, both for consolidated and unconsolidated properties; |
| | · | adding back amortization of deferred financing costs; |
| | · | adding back non-cash stock expense; |
| | · | adding back FFO attributed to our partners in consolidated joint ventures; and |
| | · | making adjustments to ground lease payments, which are required by GAAP to be amortized on a straight-line basis over the term of the lease, to reflect the actual lease payment. |
FFO and AFFO do not represent cash flows from operating activities in accordance with GAAP and should not be considered an alternative to net income as an indication of Hersha’s performance or to cash flow as a measure of liquidity or ability to make distributions. We consider FFO and AFFO to be meaningful, additional measures of our operating performance because they exclude the effects of the assumption that the value of real estate assets diminishes predictably over time, and because they are widely used by industry analysts as performance measures. We show both FFO from consolidated hotel operations and FFO from unconsolidated joint ventures because we believe it is meaningful for the investor to understand the relative contributions from our consolidated and unconsolidated hotels. The display of both FFO from consolidated hotels and FFO from unconsolidated joint ventures allows for a detailed analysis of the operating performance of our hotel portfolio by management and investors. We present FFO and AFFO applicable to common shares and Partnership units because our Partnership units are redeemable for common shares. We believe it is meaningful for the investor to understand FFO applicable to all common shares and Partnership units.
The following table reconciles FFO and AFFO for the periods presented to the most directly comparable GAAP measure, net income (loss) applicable to common shares, for the same periods:
Adjusted Funds from Operations (AFFO)
(in thousands, except shares and per share data)
| | | Three Months Ended | | | Year Ended | |
| | | December 31, 2007 | | | December 31, 2006 | | | December 31, 2007 | | | December 31, 2006 | |
| | | | | | | | | | | | | |
| Net income applicable to common shares | | $ | 4,594 | | | $ | (1,374 | ) | | $ | 13,047 | | | $ | 298 | |
| Income allocated to minority interest | | | 210 | | | | 11 | | | | 1,765 | | | | 536 | |
| Income from discontinued operations allocated to minority interest | | | 43 | | | | 20 | | | | 57 | | | | 80 | |
| Income from unconsolidated joint ventures | | | (893 | ) | | | (367 | ) | | | (3,476 | ) | | | (1,799 | ) |
| Gain on sale of assets | | | (3,745 | ) | | | (257 | ) | | | (3,745 | ) | | | (693 | ) |
| Depreciation and amortization | | | 9,213 | | | | 6,060 | | | | 34,336 | | | | 18,954 | |
| Depreciation and amortization from discontinued operations | | | - | | | | 290 | | | | 794 | | | | 1,316 | |
| FFO related to the minority interests in consolidated joint ventures | | | (91 | ) | | | (390 | ) | | | (652 | ) | | | (714 | ) |
| Funds from consolidated hotel operations applicable to common shares and Partnership units | | | 9,331 | | | | 3,993 | | | | 42,126 | | | | 17,978 | |
| | | | | | | | | | | | | | | | | |
| Income from Unconsolidated Joint Ventures | | | 893 | | | | 367 | | | | 3,476 | | | | 1,799 | |
| Add: | | | | | | | | | | | | | | | | |
| Depreciation and amortization of purchase price in excess of historical cost | | | 523 | | | | 448 | | | | 2,055 | | | | 1,817 | |
| Interest in deferred financing costs written off in unconsolidated joint venture debt extinguishment | | | - | | | | - | | | | (2,858 | ) | | | (207 | ) |
| Interest in depreciation and amortization of unconsolidated joint ventures | | | 407 | | | | 360 | | | | 5,022 | | | | 4,549 | |
| Funds from unconsolidated joint venture operations applicable to common shares and Partnership units | | | 1,823 | | | | 1,175 | | | | 7,695 | | | | 7,958 | |
| | | | | | | | | | | | | | | | | |
| Funds from Operations applicable to common shares and Partnership units | | | 11,154 | | | | 5,168 | | | | 49,821 | | | | 25,936 | |
| | | | | | | | | | | | | | | | | |
| Add: | | | | | | | | | | | | | | | | |
| FFO related to the minority interests in consolidated joint ventures | | | 91 | | | | 390 | | | | 652 | | | | 714 | |
| Amortization of deferred financing costs | | | 534 | | | | 329 | | | | 1,780 | | | | 953 | |
| Deferred financing costs written off in debt extinguishment | | | - | | | | 322 | | | | - | | | | 1,485 | |
| Interest in deferred financing costs written off in unconsolidated joint venture debt extinguishment | | | - | | | | - | | | | 2,858 | | | | 207 | |
| Amortization of discounts and premiums | | | (139 | ) | | | 23 | | | | (134 | ) | | | 38 | |
| Non cash stock expense | | | 260 | | | | 95 | | | | 766 | | | | 293 | |
| Straight-line Amortization of ground lease expense | | | 56 | | | | 65 | | | | 258 | | | | 262 | |
| | | | | | | | | | | | | | | | | |
| Adjusted Funds from Operations | | $ | 11,956 | | | $ | 6,392 | | | $ | 56,001 | | | $ | 29,888 | |
| | | | | | | | | | | | | | | | | |
| AFFO per Diluted Weighted Average Common Shares and Units Outstanding | | $ | 0.25 | | | $ | 0.17 | | | $ | 1.21 | | | $ | 0.97 | |
| | | | | | | | | | | | | | | | | |
| Diluted Weighted Average Common Shares and Units Outstanding | | | 47,311,796 | | | | 37,951,192 | | | | 46,183,394 | | | | 30,672,625 | |
EBITDA and GAAP Reconciliation
Earnings Before Interest, Taxes, and Depreciation and Amortization (EBITDA) and Adjusted EBITDA are non-GAAP financial measure within the meaning of the Securities and Exchange Commission rules. Our interpretation of Adjusted EBITDA is that EBITDA derived from our investment in unconsolidated joint ventures should be added back to net income (loss) as part of reconciling net income (loss) to Adjusted EBITDA. Our Adjusted EBITDA computation may not be comparable to EBITDA reported by other companies that interpret the definition of EBITDA differently than we do. Management believes EBITDA to be a meaningful measure of a REIT's performance and that it should be considered along with, but not as an alternative to, net income, cash flow, FFO and AFFO, as a measure of the company's operating performance.
Hotel EBITDA is a commonly used measure of performance in the hotel industry for a specific hotel or group of hotels. We believe Hotel EBITDA provides a more complete understanding of the operating results of the individual hotel or group of hotels. We calculate Hotel EBITDA by utilizing the total revenues generated from hotel operations less all operating expenses, property taxes, insurance and management fees, which calculation excludes Company expenses not specific to a hotel. Because Hotel EBITDA is specific to individual hotels or groups of hotels and not to the Company as a whole, it is not reconcilable to any comparable GAAP measure for the Company.
HERSHA HOSPITALITY TRUST
Adjusted EBITDA
(in thousands, except shares and per share data)
| | | Three Months Ended | | | Year Ended | |
| | | December 31, 2007 | | | December 31, 2006 | | | December 31, 2007 | | | December 31, 2006 | |
| | | | | | | | | | | | | |
| Net Income applicable to common shares | | $ | 4,594 | | | $ | (1,374 | ) | | $ | 13,047 | | | $ | 298 | |
| Less: | | | | | | | | | | | | | | | | |
| Income from Unconsolidated Joint Ventures | | | (893 | ) | | | (367 | ) | | | (3,476 | ) | | | (1,799 | ) |
| Interest income | | | (96 | ) | | | (259 | ) | | | (686 | ) | | | (1,182 | ) |
| Add: | | | | | | | | | | | | | | | | |
| Income allocated to minority interest for continuing operations | | | 210 | | | | 11 | | | | 1,765 | | | | 536 | |
| Income allocated to minority interest for discontinued operations and gain on disposition of hotel properties | | | 546 | | | | 50 | | | | 560 | | | | 171 | |
| Interest expense from continuing operations | | | 10,988 | | | | 7,746 | | | | 42,402 | | | | 25,423 | |
| Interest expense from discontinued operations | | | 178 | | | | 399 | | | | 989 | | | | 1,915 | |
| Deferred financing costs written off in debt extinguishment | | | - | | | | 322 | | | | - | | | | 1,485 | |
| Distributions to Series A Preferred Shareholders | | | 1,200 | | | | 1,200 | | | | 4,800 | | | | 4,800 | |
| Depreciation and amortization from continuing operations | | | 9,213 | | | | 6,060 | | | | 34,336 | | | | 18,954 | |
| Depreciation from discontinued operations | | | - | | | | 290 | | | | 794 | | | | 1,316 | |
| Non-cash stock expense | | | 260 | | | | 95 | | | | 766 | | | | 293 | |
| Straight-line Amortization of ground lease expense | | | 56 | | | | 65 | | | | 258 | | | | 262 | |
| | | | | | | | | | | | | | | | | |
| Adjusted EBITDA from consolidated hotel operations | | | 26,256 | | | | 14,238 | | | | 95,555 | | | | 52,472 | |
| | | | | | | | | | | | | | | | | |
| Income from Unconsolidated Joint Ventures | | | 893 | | | | 367 | | | | 3,476 | | | | 1,799 | |
| Add: | | | | | | | | | | | | | | | | |
| Depreciation and amortization of purchase price in excess of historical cost | | | 523 | | | | 448 | | | | 2,055 | | | | 1,817 | |
| Adjustment for interest in interest expense, depreciation and amortization of unconsolidated joint ventures | | | 2,269 | | | | 2,884 | | | | 16,077 | | | | 15,890 | |
| | | | | | | | | | | | | | | | | |
| Adjusted EBITDA from unconsolidated joint venture operations | | | 3,685 | | | | 3,699 | | | | 21,608 | | | | 19,506 | |
| | | | | | | | | | | | | | | | | |
| Adjusted EBITDA | | $ | 29,941 | | | $ | 17,937 | | | $ | 117,163 | | | $ | 71,978 | |
Adjusted Funds from Operations (FFO) - 2008 FORECAST RECONCILIATION
(in thousands, except shares and per share data)
| | | Low | | | High | |
| | | Twelve Months Ending | |
| | | 12/31/2008 | | | 12/31/2008 | |
| | | | | | | |
| Net Income applicable to common shares | | $ | 13,000 | | | $ | 14,500 | |
| Less: | | | | | | | | |
| (Income) from Unconsolidated Joint Ventures | | | (3,500 | ) | | | (3,500 | ) |
| FFO related to the minority interests in consolidated joint ventures | | | (450 | ) | | | (550 | ) |
| Add: | | | | | | | | |
| Income allocated to minority interest in our operating partnership | | | 3,000 | | | | 3,100 | |
| Depreciation and amortization | | | 37,000 | | | | 37,000 | |
| Funds from Consolidated Hotel Operations | | | 49,050 | | | | 50,550 | |
| | | | | | | | | |
| Income from Unconsolidated Joint Ventures | | | 3,500 | | | | 3,500 | |
| Add: | | | | | | | | |
| Depreciation and amortization | | | 5,750 | | | | 5,750 | |
| Funds from Unconsolidated Joint Venture Operations | | | 9,250 | | | | 9,250 | |
| | | | | | | | | |
| Funds from Operations | | | 58,300 | | | | 59,800 | |
| | | | | | | | | |
| Add: | | | | | | | | |
| FFO related to the minority interests in consolidated joint ventures | | | 450 | | | | 550 | |
| Amortization of deferred financing costs | | | 1,650 | | | | 1,650 | |
| Non cash stock expense | | | 1,050 | | | | 1,050 | |
| Amortization of ground lease expense | | | 265 | | | | 265 | |
| | | | | | | | | |
| Adjusted Funds from Operations | | $ | 61,715 | | | $ | 63,315 | |
| | | | | | | | | |
| Diluted Weighted Average Common Shares and Units Outstanding | | | 48,600,000 | | | | 48,600,000 | |
| Adjusted FFO per Diluted Weighted Average Common Shares and Units Outstanding | | $ | 1.27 | | | $ | 1.30 | |
Adjusted EBITDA - 2008 FORECAST RECONCILIATION
(in thousands, except shares and per share data)
| | | Twelve Months Ended | |
| | | December 31, 2008 | | | December 31, 2008 | |
| | | | | | | |
| Net Income applicable to common shares | | $ | 13,000 | | | $ | 14,500 | |
| Less: | | | | | | | | |
| Income from Unconsolidated Joint Ventures | | | (3,500 | ) | | | (3,500 | ) |
| Interest income | | | (1,000 | ) | | | (1,000 | ) |
| Add: | | | | | | | | |
| Income allocated to minority interest in common units | | | 3,000 | | | | 3,100 | |
| Interest expense | | | 42,000 | | | | 42,000 | |
| Distributions to Series A Preferred Shareholders | | | 4,800 | | | | 4,800 | |
| Depreciation and amortization from continuing operations | | | 37,000 | | | | 37,000 | |
| Amortization of deferred financing costs | | | 1,650 | | | | 1,650 | |
| Non cash stock expense | | | 1,050 | | | | 1,050 | |
| Amortization of ground lease expense | | | 265 | | | | 265 | |
| | | | | | | | | |
| Adjusted EBITDA from consolidated hotel operations | | | 98,265 | | | | 99,865 | |
| | | | | | | | | |
| Income (Loss) from Unconsolidated Joint Ventures | | | 3,500 | | | | 3,500 | |
| Add: | | | | | | | | |
| Interest expense | | | 11,550 | | | | 11,850 | |
| Depreciation and amortization of purchase price in excess of historical cost | | | 2,350 | | | | 2,350 | |
| Interest in depreciation and amortization of unconsolidated joint venture | | | 3,400 | | | | 3,400 | |
| | | | | | | | | |
| Adjusted EBITDA from unconsolidated joint venture operations | | | 20,800 | | | | 21,100 | |
| | | | | | | | | |
| Adjusted EBITDA | | $ | 119,065 | | | $ | 120,965 | |
Supplemental Schedules
The company has provided supplemental schedules to this press release in order to provide additional disclosure and financial information for the benefit of the company's stakeholders. These can found in the “Presentations and Supplemental Schedules” page of the Company’s Web site.
HERSHA HOSPITALITY TRUST
KEY PERFORMANCE INDICATORS
December 31, 2007
(Unaudited)
| CONSOLIDATED HOTELS: | | | | | | | | | | | | | | | | | | |
| (Recorded from date of acquisition or investment) | | (2007 Includes 55 Hotels 2006 includes 42 Hotels) | | | (2007 Includes 55 Hotels 2006 includes 43 Hotels) | |
| | | | | | Three Months Ended | | | | | | | | | Twelve Months Ended | | | | |
| | | | | | December 31, | | | | | | | | | December 31, | | | | |
| | | 2007 | | | 2006 | | | % Variance | | | 2007 | | | 2006 | | | % Variance | |
| | | | | | | | | | | | | | | | | | | |
| Rooms Available | | | 577,050 | | | | 436,797 | | | | | | | 2,248,253 | | | | 1,507,003 | | | | |
| Rooms Occupied | | | 398,062 | | | | 296,460 | | | | | | | 1,656,158 | | | | 1,086,476 | | | | |
| Occupancy | | | 68.98 | % | | | 67.87 | % | | | 1.6 | % | | | 73.66 | % | | | 72.10 | % | | | 2.2 | % |
| Average Daily Rate (ADR) | | $ | 136.93 | | | $ | 118.75 | | | | 15.3 | % | | $ | 131.26 | | | $ | 115.49 | | | | 13.7 | % |
| Revenue Per Available Room (RevPAR) | | $ | 94.46 | | | $ | 80.60 | | | | 17.2 | % | | $ | 96.69 | | | $ | 83.26 | | | | 16.1 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Room Revenues | | $ | 54,507,924 | | | $ | 35,205,086 | | | | | | | $ | 217,393,817 | | | $ | 125,475,166 | | | | | |
| Food & Beverage | | $ | 1,677,767 | | | $ | 1,434,780 | | | | | | | $ | 6,792,524 | | | $ | 6,616,034 | | | | | |
| Other Revenues | | $ | 1,292,283 | | | $ | 940,961 | | | | | | | $ | 5,275,899 | | | $ | 3,182,584 | | | | | |
| Total Revenues | | $ | 57,477,974 | | | $ | 37,580,826 | | | | | | | $ | 229,462,240 | | | $ | 135,273,785 | | | | | |
| Discontinued Assets | | $ | 1,287,345 | | | $ | 2,664,263 | | | | | | | $ | 6,683,896 | | | $ | 12,926,991 | | | | | |
| EBITDA | | $ | 20,893,148 | | | $ | 13,092,533 | | | | | | | $ | 86,588,589 | | | $ | 49,118,656 | | | | | |
| EBITDA Margin | | | 36.3 | % | | | 34.8 | % | | | | | | | 37.7 | % | | | 36.3 | % | | | | |
| EBITDA Margin Growth | | | 1.51 | % | | | | | | | | | | | 1.42 | % | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| SAME STORE CONSOLIDATED HOTELS: | | (Includes 42 Hotels for both 2007 and 2006) | | | (Includes 27 Hotels for both 2007 and 2006) | |
| (Owned for the entire reporting period) | | | | | | Three Months Ended | | | | | | | | | | | Twelve Months Ended | | | | | |
| | | | | | | December 31, | | | | | | | | | | | December 31, | | | | | |
| | | 2007 | | | 2006 | | | % Variance | | | 2007 | | | 2006 | | | % Variance | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Rooms Available | | | 436,794 | | | | 436,797 | | | | | | | | 1,001,848 | | | | 1,002,290 | | | | | |
| Rooms Occupied | | | 298,812 | | | | 296,460 | | | | | | | | 721,503 | | | | 710,967 | | | | | |
| Occupancy | | | 68.41 | % | | | 67.87 | % | | | 0.8 | % | | | 72.02 | % | | | 70.93 | % | | | 1.5 | % |
| Average Daily Rate (ADR) | | $ | 132.17 | | | $ | 118.75 | | | | 11.3 | % | | $ | 121.95 | | | $ | 113.60 | | | | 7.4 | % |
| Revenue Per Available Room (RevPAR) | | $ | 90.42 | | | $ | 80.60 | | | | 12.2 | % | | $ | 87.83 | | | $ | 80.58 | | | | 9.0 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Room Revenues | | $ | 39,494,894 | | | $ | 35,205,086 | | | | | | | $ | 87,987,824 | | | $ | 80,763,944 | | | | | |
| Food & Beverage | | $ | 1,489,697 | | | $ | 1,434,780 | | | | | | | $ | 3,933,469 | | | $ | 4,033,231 | | | | | |
| Other Revenues | | $ | 1,041,121 | | | $ | 940,961 | | | | | | | $ | 1,901,064 | | | $ | 1,804,590 | | | | | |
| Total Revenues | | $ | 42,025,711 | | | $ | 37,580,826 | | | | | | | $ | 93,822,358 | | | $ | 86,601,765 | | | | | |
| EBITDA | | $ | 14,772,573 | | | $ | 12,494,336 | | | | | | | $ | 33,710,719 | | | $ | 30,729,290 | | | | | |
| EBITDA Margin | | | 35.2 | % | | | 33.2 | % | | | | | | | 35.9 | % | | | 35.5 | % | | | | |
| EBITDA Margin Growth | | | 1.90 | % | | | | | | | | | | | 0.45 | % | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| SAME STORE HOTELS: | | (Includes 56 Hotels for both 2007 and 2006) | | | (Includes 40 Hotels for both 2007 and 2006) | |
| (Owned for the entire reporting period) | | | | | | Three Months Ended | | | | | | | | | | | Twelve Months Ended | | | | | |
| | | | | | | December 31, | | | | | | | | | | | December 31, | | | | | |
| | | 2007 | | | 2006 | | | % Variance | | | 2007 | | | 2006 | | | % Variance | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Rooms Available | | | 658,146 | | | | 658,262 | | | | | | | | 1,733,241 | | | | 1,734,115 | | | | | |
| Rooms Occupied | | | 450,314 | | | | 439,306 | | | | | | | | 1,255,748 | | | | 1,241,252 | | | | | |
| Occupancy | | | 68.42 | % | | | 66.74 | % | | | 2.5 | % | | | 72.45 | % | | | 71.58 | % | | | 1.2 | % |
| Average Daily Rate (ADR) | | $ | 133.86 | | | $ | 122.36 | | | | 9.4 | % | | $ | 129.86 | | | $ | 121.31 | | | | 7.0 | % |
| Revenue Per Available Room (RevPAR) | | $ | 91.59 | | | $ | 81.66 | | | | 12.2 | % | | $ | 94.08 | | | $ | 86.83 | | | | 8.3 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Room Revenues | | $ | 60,278,339 | | | $ | 53,755,622 | | | | | | | $ | 163,066,365 | | | $ | 150,581,288 | | | | | |
| Food & Beverage | | $ | 8,456,380 | | | $ | 8,051,706 | | | | | | | $ | 18,579,406 | | | $ | 19,308,896 | | | | | |
| Other Revenues | | $ | 3,050,988 | | | $ | 2,861,929 | | | | | | | $ | 8,872,738 | | | $ | 8,491,904 | | | | | |
| Total Revenues | | $ | 71,785,707 | | | $ | 64,669,257 | | | | | | | $ | 190,518,509 | | | $ | 178,382,088 | | | | | |
| EBITDA | | $ | 21,141,699 | | | $ | 17,699,493 | | | | | | | $ | 59,011,067 | | | $ | 53,565,773 | | | | | |
| EBITDA Margin | | | 29.5 | % | | | 27.4 | % | | | | | | | 31.0 | % | | | 30.0 | % | | | | |
| EBITDA Margin Growth | | | 2.08 | % | | | | | | | | | | | 0.95 | % | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| ALL HOTELS INCLUDING JOINT VENTURE ASSETS: | | | | | | | | | | | | | | | | | | | | | | | | |
| (Recorded from date of acquisition or investment) | | (2007 Includes 70 Hotels 2006 Includes 56 Hotels) | | | (2007 Includes 70 Hotels 2006 Includes 57 Hotels) | |
| | | | | | | Three Months Ended | | | | | | | | | | | Twelve Months Ended | | | | | |
| | | | | | | December 31, | | | | 0 | | | | | | | December 31, | | | | | |
| | | 2007 | | | 2006 | | | % Variance | | | 2007 | | | 2006 | | | % Variance | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Rooms Available | | | 819,150 | | | | 658,262 | | | | | | | | 3,202,367 | | | | 2,386,387 | | | | | |
| Rooms Occupied | | | 569,241 | | | | 439,306 | | | | | | | | 2,338,327 | | | | 1,699,748 | | | | | |
| Occupancy | | | 69.49 | % | | | 66.74 | % | | | 4.1 | % | | | 73.02 | % | | | 71.23 | % | | | 2.5 | % |
| Average Daily Rate (ADR) | | $ | 141.10 | | | $ | 122.36 | | | | 15.3 | % | | $ | 135.13 | | | $ | 121.64 | | | | 11.1 | % |
| Revenue Per Available Room (RevPAR) | | $ | 98.05 | | | $ | 81.66 | | | | 20.1 | % | | $ | 98.67 | | | $ | 86.64 | | | | 13.9 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Room Revenues | | $ | 80,318,588 | | | $ | 53,755,622 | | | | | | | $ | 315,974,446 | | | $ | 206,760,910 | | | | | |
| Food & Beverage | | $ | 8,644,450 | | | $ | 8,051,706 | | | | | | | $ | 30,313,420 | | | $ | 29,160,358 | | | | | |
| Other Revenues | | $ | 3,326,621 | | | $ | 2,861,929 | | | | | | | $ | 13,341,825 | | | $ | 10,653,865 | | | | | |
| Total Revenues | | $ | 92,289,659 | | | $ | 64,669,257 | | | | | | | $ | 359,629,690 | | | $ | 246,575,133 | | | | | |
| Discontinued Assets | | $ | 1,287,345 | | | $ | 2,664,263 | | | | | | | $ | 6,683,896 | | | $ | 12,926,991 | | | | | |
| EBITDA | | $ | 29,926,684 | | | $ | 17,697,691 | | | | | | | $ | 121,110,583 | | | $ | 72,873,064 | | | | | |
| EBITDA Margin | | | 32.4 | % | | | 27.4 | % | | | | | | | 33.7 | % | | | 29.6 | % | | | | |
| EBITDA Margin Growth | | | 5.06 | % | | | | | | | | | | | 4.12 | % | | | | | | | | |
Hersha Hospitality Trust
Total Portfolio
December 31, 2007
(Dollars in thousands)
| | Name | Rooms | | Year Opened/Complete Renovation | Acquisition Date | Debt Balance as of 12/31/07 | | Ownership % | | Hersha Preferred Equity Return | |
| | Marriott | | | | | | | | | | |
| 1. | Mystic, CT | | 285 | | 2001 | 8/9/2005 | $ | 43,000 | | | 66.7 | % | | 8.50 | % |
| 2. | Hartford, CT | | 409 | | 2005 | 2/8/2006 | $ | 45,000 | | | 15.0 | % | | 8.50 | % |
| | Hilton | | | | | | | | | | | | | | |
| 3. | Hartford, CT | | 393 | | 2005 | 10/6/2005 | $ | 22,000 | | | 8.8 | % | | 8.50 | % |
| | Courtyard | | | | | | | | | | | | | | |
| 4. | Alexandria | | 203 | | 2006 | 09/29/06 | $ | 25,000 | | | 100.0 | % | | | |
| 5. | Scranton | | 120 | | 1996 | 2/1/2006 | $ | 6,300 | | | 100.0 | % | | | |
| 6. | Langhorne, PA | | 118 | | 2002 | 1/3/2006 | $ | 15,575 | | | 100.0 | % | | | |
| 7. | Brookline/Boston, MA | | 188 | | 2003 | 6/16/2005 | $ | 38,913 | | | 100.0 | % | | | |
| 8. | Norwich, CT | | 144 | | 1997 | 8/9/2005 | $ | 9,400 | | | 66.7 | % | | 8.50 | % |
| 9. | South Boston, MA | | 164 | | 2005 | 7/1/2005 | $ | 16,134 | | | 50.0 | % | | | |
| 10. | Wilmington, DE | | 78 | | 1999 | 6/17/2005 | $ | 8,000 | | | 100.0 | % | | | |
| 11. | Warwick, RI | | 92 | | 2003 | 8/9/2005 | $ | 6,450 | | | 66.7 | % | | 8.50 | % |
| 12. | Ewing/Princeton, NJ | | 130 | | 2004 | 7/1/2004 | $ | 13,500 | | | 50.0 | % | | 11.00 | % |
| Hampton Inn | | | | | | | | | | | | | | |
| 13. | Farmingville | | 161 | | 2002 | 9/6/2006 | $ | 15,089 | | | 100.0 | % | | | |
| 14. | Philadelphia, PA | | 250 | | 2001 | 2/15/2006 | | ( | *) | | 100.0 | % | | | |
| 15. | Chelsea/Manhattan, NY | | 144 | | 2003 | 8/29/2003 | $ | 36,000 | | | 100.0 | % | | | |
| 16. | Hershey, PA | | 110 | | 1999 | 1/1/2000 | $ | 3,177 | | | 100.0 | % | | | |
| 17. | Carlisle, PA | | 95 | | 1997 | 1/26/1999 | $ | 3,562 | | | 100.0 | % | | | |
| 18. | Danville, PA | | 72 | | 1998 | 9/1/1999 | $ | 2,255 | | | 100.0 | % | | | |
| 19. | Selinsgrove, PA | | 75 | | 1996 | 1/26/1999 | $ | 2,976 | | | 100.0 | % | | | |
| 20. | Herald Square, Manhattan, NY | | 136 | | 2005 | 4/1/2005 | $ | 26,500 | | | 100.0 | % | | | |
| 21. | Seaport, NY | | 65 | | 2006 | 2/1/2007 | $ | 20,116 | | | 100.0 | % | (a) | |
| | Residence Inn | | | | | | | | | | | | | | |
| 22. | North Dartmouth, MA | | 96 | | 2002 | 5/1/2006 | $ | 8,777 | | | 100.0 | % | (a) | |
| 23. | Tysons Corner, VA | | 96 | | 1984 | 2/2/2006 | $ | 9,249 | | | 100.0 | % | | | |
| 24. | Danbury, CT | | 78 | | 1999 | 8/9/2005 | $ | 8,050 | | | 66.7 | % | | 8.50 | % |
| 25. | Framingham, MA | | 125 | | 2000 | 3/26/2004 | $ | 9,036 | | | 100.0 | % | | | |
| 26. | Greenbelt, MD | | 120 | | 2002 | 7/16/2004 | $ | 12,302 | | | 100.0 | % | | | |
| 27. | Mystic, CT | | 133 | | 1996 | 09/15/2005 | $ | 7,692 | | | 66.7 | % | | 8.50 | % |
| 28. | Southington, CT | | 94 | | 2002 | 8/9/2005 | $ | 10,950 | | | 44.7 | % | | 8.50 | % |
| 29. | Williamsburg, VA | | 108 | | 2002 | 11/22/2005 | $ | 7,922 | | | 75.0 | % | | 12.00 | % |
| 30. | Norwood, MA | | 96 | | 2006 | 7/27/2006 | | ( | *) | | 100.0 | % | | | |
| 31. | Langhorne, PA | | 100 | | 2007 | 1/8/2007 | | ( | *) | | 100.0 | % | | | |
| 32. | Carlisle, PA | | 78 | | 2007 | 1/10/2007 | $ | 7,000 | | | 100.0 | % | | | |
| | Summerfield Suites | | | | | | | | | | | | | | |
| 33. | White Plains, NY | | 159 | | 2000 | 12/28/2006 | $ | 33,030 | | | 100.0 | % | | | |
| 34. | Bridgewater, NJ | | 128 | | 1998 | 12/28/2006 | $ | 14,492 | | | 100.0 | % | | | |
| 35. | Gaithersburg, MD | | 140 | | 1998 | 12/28/2006 | $ | 13,720 | | | 100.0 | % | | | |
| 36. | Pleasant Hill, CA | | 142 | | 2003 | 12/28/2006 | $ | 20,160 | | | 100.0 | % | | | |
| 37. | Pleasanton, CA | | 128 | | 1998 | 12/28/2006 | $ | 14,490 | | | 100.0 | % | | | |
| 38. | Scottsdale, AZ | | 164 | | 1999 | 12/28/2006 | $ | 16,778 | | | 100.0 | % | | | |
| 39. | Charlotte, NC | | 144 | | 1989 | 12/28/2006 | $ | 7,330 | | | 100.0 | % | | | |
| | Homewood Suites | | | | | | | | | | | | | | |
| 40. | Glastonbury, CT | | 136 | | 2006 | 6/15/2006 | $ | 12,826 | | | 48.0 | % | | 10.00 | % |
| | Holiday Inn Express | | | | | | | | | | | | | | |
| 41. | Hauppauge | | 133 | | 2001 | 09/01/06 | $ | 9,961 | | | 100.0 | % | (a) | |
| 42. | Cambridge, MA | | 112 | | 1997 | 05/03/06 | $ | 8,389 | | | 100.0 | % | | | |
| 43. | Hershey, PA | | 85 | | 1997 | 1/26/1999 | $ | 4,238 | | | 100.0 | % | | | |
| 44. | New Columbia, PA | | 81 | | 1997 | 1/26/1999 | $ | 1,623 | | | 100.0 | % | | | |
| 45. | Malvern, PA | | 88 | | 2004 | 5/24/2005 | $ | 4,070 | | | 100.0 | % | | | |
| 46. | Oxford Valley, PA | | 88 | | 2004 | 5/26/2005 | $ | 6,550 | | | 100.0 | % | | | |
| 47. | South Boston, MA | | 118 | | 1998 | 10/7/2005 | $ | 6,023 | | | 50.0 | % | | | |
| 48. | Chester, NY | | 80 | | 2006 | 1/25/2007 | $ | 6,700 | | | 100.0 | % | | | |
| 49. | Madison Square Garden | | 228 | | 2006 | 2/1/2007 | $ | 70,000 | | | 50.0 | % | | | |
| | Hilton Garden Inn | | | | | | | | | | | | | | |
| 50. | JFK Airport, NY | | 188 | | 2005 | 2/16/2006 | $ | 21,000 | | | 100.0 | % | | | |
| 51. | Edison, NJ | | 132 | | 2003 | 10/1/2003 | $ | 7,709 | | | 100.0 | % | | | |
| 52. | Glastonbury, CT | | 150 | | 2003 | 11/13/2003 | $ | 13,500 | | | 48.0 | % | | 11.00 | % |
| 53. | Gettysburg, PA | | 88 | | 2004 | 7/23/2004 | $ | 5,140 | | | 100.0 | % | | | |
| | Springhill Suites | | | | | | | | | | | | | | |
| 54. | Waterford, CT | | 80 | | 1998 | 8/9/2005 | $ | 6,335 | | | 66.7 | % | | 8.50 | % |
| 55. | Williamsburg, VA | | 120 | | 2002 | 11/22/2005 | $ | 5,394 | | | 75.0 | % | | 12.00 | % |
| | Holiday Inn Express & Suites | | | | | | | | | | | | | | |
| 56. | Harrisburg, PA | | 77 | | 1997 | 9/1/1999 | | ( | *) | | 100.0 | % | | | |
| 57. | King of Prussia, PA | | 155 | | 2004 | 5/23/2005 | $ | 12,950 | | | 100.0 | % | | | |
| | Four Points - Sheraton | | | | | | | | | | | | | | |
| 58. | Revere/Boston, MA | | 180 | | 2001 | 3/11/2004 | $ | 8,328 | | | 55.0 | % | | 12.00 | % |
| | Mainstay | | | | | | | | | | | | | | |
| 59. | Valley Forge, PA | | 69 | | 2000 | 6/1/2001 | | ( | *) | | 100.0 | % | | | |
| 60. | Frederick, MD | | 72 | | 2001 | 1/1/2002 | $ | 2,638 | | | 100.0 | % | | | |
| | Holiday Inn (HICC) | | | | | | | | | | | | | | |
| 61. | Harrisburg, PA | | 196 | | 1970 | 1/26/1999 | $ | 3,066 | | | 100.0 | % | | | |
| 62. | Norwich, CT | | 134 | | 2006 | 7/1/2007 | | ( | *) | | 100.0 | % | | | |
| | Comfort Inn | | | | | | | | | | | | | | |
| 63. | North Dartmouth, MA | | 84 | | 1986 | 05/01/06 | $ | 3,145 | | | 100.0 | % | | | |
| 64. | Harrisburg, PA | | 81 | | 1998 | 1/26/1999 | $ | 2,164 | | | 100.0 | % | | | |
| 65. | Frederick, MD | | 73 | | 2004 | 5/27/2004 | $ | 3,387 | | | 100.0 | % | | | |
| | Fairfield Inn | | | | | | | | | | | | | | |
| 66. | Bethlehem, PA | | 103 | | 1997 | 1/3/2006 | $ | 6,225 | | | 100.0 | % | | | |
| 67. | Laurel, MD | | 109 | | 1999 | 1/31/2005 | | ( | *) | | 100.0 | % | | | |
| | Hawthorne Suites | | | | | | | | | | | | | | |
| 68. | Franklin, MA | | 100 | | 1999 | 4/25/2006 | $ | 8,500 | | | 100.0 | % | | | |
| | Independent | | | | | | | | | | | | | | |
| 69. | Inn at Wilmington | | 71 | | 1999 | 6/17/2005 | $ | 4,730 | | | 100.0 | % | | | |
| 70. | 373 Fifth Avenue | | 70 | | 2007 | 6/1/2007 | $ | 22,000 | | | 100.0 | % | | | |
| | Sleep Inn | | | | | | | | | | | | | | |
| 71. | Valley Forge, PA | | 87 | | 2000 | 6/1/2001 | | ( | *) | | 100.0 | % | | | |
| | TOTAL | | 9,129 | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | |
| | (*) - Asset is encumbered by the Company's credit facility | | | | | | | | | | |
| | (a) - Debt balance reflects original issue premium or discount | | | | | | | | | | |
Hersha Hospitality Trust
2007 Acquisition Activity
December 31, 2007
(Dollars in thousands)
| | Name | | Rooms | | Year Opened/ Complete Renovation | Acquisition Date | | Purchase Price | | | Debt Balance | | | Ownership % | | | HERSHA % OF ACQUISITIONS | | | HERSHA % OF DEBT | | | Hersha Preferred Equity Return | |
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| 1. | Residence Inn - Langhorne, PA (*) | | | 100 | | 2007 | 01/08/2007 | | $ | 15,500 | | | $ | 0 | | | | 100.0 | % | | $ | 15,500 | | | $ | 0 | | | | N/A | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 2. | Residence Inn - Carlisle, PA | | | 78 | | 2007 | 01/10/2007 | | $ | 9,945 | | | $ | 7,000 | | | | 100.0 | % | | $ | 9,945 | | | $ | 7,000 | | | | N/A | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 3. | Holiday Inn Express - Chester, NY | | | 80 | | 2006 | 01/25/2007 | | $ | 9,200 | | | $ | 6,700 | | | | 100.0 | % | | $ | 9,200 | | | $ | 6,700 | | | | N/A | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 4. | Hampton Inn Seaport | | | 65 | | 2006 | 02/01/2007 | | $ | 27,625 | | | $ | 20,116 | | | | 100.0 | % | | $ | 27,625 | | | $ | 20,116 | | | | N/A | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 5. | Holiday Inn Express - Madison Square Garden, NY | | | 228 | | 2006 | 02/01/2007 | | $ | 85,500 | | | $ | 70,000 | | | | 50.0 | % | | $ | 42,750 | | | $ | 35,000 | | | | N/A | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 6. | Hotel 373 and Starbucks Leasehold, Manhattan, NY | | | 70 | | 2007 | 06/01/2007 | | $ | 34,000 | | | $ | 22,000 | | | | 100.0 | % | | $ | 34,000 | | | $ | 22,000 | | | | N/A | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 7. | Holiday Inn - Norwich, CT (*) | | | 134 | | 2006 | 07/01/2007 | | $ | 16,080 | | | $ | 0 | | | | 100.0 | % | | $ | 16,080 | | | $ | 0 | | | | N/A | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Sub-Total | | | 755 | | | | | $ | 197,850 | | | $ | 125,816 | | | | | | | $ | 155,100 | | | $ | 90,816 | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | (*) - Encumbered by the Company's credit facility. | | | | | | | | | | | | | | | | | |
| | Note: On October 1, 2007, the Company acquired the remaining 20% interest in the Hampton Inn Philadelphia from its joint venture partners for the amount of $3.58M. | | | | | | | | | | | | | | | | | |
Hersha Hospitality Trust
2007 Disposition Activity
December 31, 2007
(Dollars in thousands)
| | Name | | Rooms | | Disposition Date | | Disposition Price | | | Debt Outstanding | | | Ownership % | |
| Fairfield Inn | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
| | Mt. Laurel, NJ (*) | | | 118 | | 11/30/07 | | | ( | *) | | $ | 7,400 | | | | 100.0 | % |
| Hampton Inn | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
| | Linden, NJ (*) | | | 149 | | 11/30/07 | | | ( | *) | | $ | 9,652 | | | | 100.0 | % |
| | | | | | | | | | | | | | | | | | |
| SUBTOTAL | | | 267 | | | | $ | 29,500 | | | $ | 17,052 | | | | | |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
| | (*) - The Fairfield Inn, Mt. Laurel and Hampton Inn, Linden New Jersey were sold as a portfolio for $29.5 million. | | | | | |
| | These assets are classified as "Discontinued Assets" and were sold in Q4 2007. | | | | | | | | | | | | |
Hersha Hospitality Trust
Mortgages and Notes Payable
December 31, 2007
| | | 12/31/2007 | | | Capped or | | | 12/31/2007 | | | | | | |
| | | Fixed Rate | | | Fixed | | | Floating Rate | | Floating | | | | |
| Consolidated Properties | | Balance | | | Rate | | | Balance | | Rate | | | Maturity | |
| Four Points Sheraton - Revere, MA (SBA Loan) | | $ | 543,208 | | | | 4.00 | % | | | | | | | | 01/2032 | |
| Courtyard - Brookline, MA | | $ | 38,913,000 | | | | 5.35 | % | | | | | | | | 07/2015 | |
| Summerfield Suites - White Plains, NY | | $ | 33,030,000 | | | | 5.59 | % | | | | | | | | 01/2017 | |
| Summerfield Suites - Bridgewater, NJ | | $ | 14,492,000 | | | | 5.59 | % | | | | | | | | 01/2017 | |
| Summerfield Suites - Gaithersburg, MD | | $ | 13,720,000 | | | | 5.59 | % | | | | | | | | 01/2017 | |
| Summerfield Suites - Pleasant Hill, CA | | $ | 20,160,000 | | | | 5.59 | % | | | | | | | | 01/2017 | |
| Summerfield Suites - Pleasanton, CA | | $ | 14,490,000 | | | | 5.59 | % | | | | | | | | 01/2017 | |
| Summerfield Suites - Scottsdale, AZ | | $ | 16,778,000 | | | | 5.59 | % | | | | | | | | 01/2017 | |
| Summerfield Suites - Charlotte, NC | | $ | 7,330,000 | | | | 5.59 | % | | | | | | | | 01/2017 | |
| Holiday Inn Express - Chester, NY | | $ | 6,700,000 | | | | 5.63 | % | | | | | | | | 03/2017 | |
| Residence Inn - North Dartmouth, MA | | $ | 9,073,415 | | | | 5.67 | % | | | | | | | | 07/2015 | |
| Original Issue Discount: Residence Inn - North Dartmouth, MA | | $ | (296,406 | ) | | | 0.00 | % | | | | | | | | 07/2015 | |
| Holiday Inn Express - Hauppauge, NY | | $ | 10,357,847 | | | | 5.70 | % | | | | | | | | 03/2015 | |
| Original Issue Discount: Holiday Inn Express - Hauppauge, NY | | $ | (397,224 | ) | | | 0.00 | % | | | | | | | | 03/2015 | |
| Fairfield Inn & Suites - Bethlehem, PA | | $ | 6,225,000 | | | | 5.75 | % | | | | | | | | 02/2016 | |
| Courtyard - Langhorne, PA | | $ | 15,575,000 | | | | 5.75 | % | | | | | | | | 02/2016 | |
| Hilton Garden Inn - JFK Airport, NY | | $ | 21,000,000 | | | | 5.82 | % | | | | | | | | 04/2017 | |
| Courtyard - Scranton, PA | | $ | 6,300,000 | | | | 5.83 | % | | | | | | | | 02/2016 | |
| Hampton Inn - Herald Square, NY | | $ | 26,500,000 | | | | 6.09 | % | | | | | | | | 04/2016 | |
| Hampton Inn - Chelsea, NY | | $ | 36,000,000 | | | | 6.24 | % | | | | | | | | 10/2016 | |
| Hilton Garden Inn - Edison, NJ | | $ | 7,709,257 | | | | 6.25 | % | | | | | | | | 10/2008 | |
| Residence Inn - Greenbelt, MD | | $ | 12,301,681 | | | | 6.25 | % | | | | | | | | 10/2014 | |
| Courtyard - Alexandria, VA | | $ | 25,000,000 | | | | 6.25 | % | | | | | | | | 10/2016 | |
| Residence Inn - Williamsburg, VA | | $ | 7,921,838 | | | | 6.32 | % | | | | | | | | 01/2013 | |
| Springhill Suites - Williamsburg, VA | | $ | 5,393,739 | | | | 6.32 | % | | | | | | | | 01/2013 | |
| Courtyard - Wilmington, DE | | $ | 8,000,000 | | | | 6.33 | % | | | | | | | | 06/2016 | |
| Independent Hotel - Wilmington, DE | | $ | 4,730,000 | | | | 6.33 | % | | | | | | | | 06/2016 | |
| Holiday Inn Express & Suites - King of Prussia, PA | | $ | 12,950,000 | | | | 6.33 | % | | | | | | | | 06/2016 | |
| Holiday Inn Express - Langhorne, PA | | $ | 6,550,000 | | | | 6.33 | % | | | | | | | | 06/2016 | |
| Holiday Inn Express - Malvern, PA | | $ | 4,070,000 | | | | 6.33 | % | | | | | | | | 06/2016 | |
| Hampton Inn - Seaport, NY | | $ | 19,250,000 | | | | 6.36 | % | | | | | | | | 10/2016 | |
| Original Issue Premium: Hampton Inn - Seaport, NY | | $ | 865,855 | | | | 0.00 | % | | | | | | | | 10/2016 | |
| Residence Inn - Framingham, MA | | $ | 9,036,245 | | | | 6.38 | % | | | | | | | | 07/2019 | |
| Hawthorne Suites - Franklin, MA | | $ | 8,500,000 | | | | 6.40 | % | | | | | | | | 05/2016 | |
| Hampton Inn - Brookhaven, NY | | $ | 15,088,999 | | | | 6.41 | % | | | | | | | | 07/2014 | |
| Land - 41st Street, Manhattan, NY | | $ | 12,100,000 | | | | 6.50 | % | | | | | | | | 08/2009 | |
| Residence Inn - Tysons Corner, VA | | $ | 9,249,207 | | | | 6.52 | % | | | | | | | | 08/2013 | |
| Comfort Inn - North Dartmouth, MA | | $ | 3,145,206 | | | | 6.55 | % | | | | | | | | 05/2016 | |
| Hilton Garden Inn - Gettysburg, PA | | $ | 5,140,149 | | | | 6.62 | % | | | | | | | | 09/2009 | |
| Four Points Sheraton - Revere, MA | | $ | 7,784,924 | | | | 6.73 | % | | | | | | | | 07/2009 | |
| Hampton Inn - Carlisle, PA | | $ | 3,562,115 | | | | 8.94 | % | | | | | | | | 04/2010 | |
| Hampton Inn - Selinsgrove, PA | | $ | 2,975,944 | | | | 8.94 | % | | | | | | | | 04/2010 | |
| Holiday Inn Express - Hershey, PA | | $ | 4,238,465 | | | | 8.94 | % | | | | | | | | 04/2010 | |
| Hampton Inn - Danville, PA | | $ | 2,254,502 | | | | 8.94 | % | | | | | | | | 04/2010 | |
| HICC - New Cumberland, PA | | $ | 3,066,124 | | | | 8.94 | % | | | | | | | | 04/2010 | |
| Comfort Inn - West Hanover, PA | | $ | 2,164,323 | | | | 8.94 | % | | | | | | | | 04/2010 | |
| Holiday Inn Express - New Columbia, PA | | $ | 1,623,242 | | | | 8.94 | % | | | | | | | | 04/2010 | |
| Note Payable Lodgeworks | | $ | 498,000 | | | | 0.00 | % | | | | | | | | 01/2017 | |
| Original Issue Discount: Notes Payable - Lodgeworks | | $ | (243,917 | ) | | | 0.00 | % | | | | | | | | 01/2017 | |
| Hotel 373 - Manhattan, NY | | | | | | | | | | $ | 22,000,000 | | 30 Day LIBOR + 2.00% | | | | 04/2009 | |
| Holiday Inn Express - Cambridge, MA | | | | | | | | | | $ | 8,388,733 | | PRIME minus 0.75% | | | | 09/2009 | |
| Residence Inn - Carlisle, PA | | | | | | | | | | $ | 7,000,000 | | PRIME minus 0.75% | | | | 01/2010 | |
| Hampton Inn - Hershey, PA | | | | | | | | | | $ | 3,176,646 | | 30 Day LIBOR + 2.75% | | | | 06/2014 | |
| Mainstay Suites and Comfort Suites - Frederick,MD (*) | | | | | | | | | | $ | 6,025,751 | | 30 Day LIBOR + 2.00% | | | | 12/2012 | |
| Land - 8th Avenue | | | | | | | | | | $ | 13,250,000 | | PRIME + 0.75% | (a) | | | 07/2008 | |
| Land - Nevins Street | | | | | | | | | | $ | 6,500,000 | | 90 Day LIBOR + 2.70% | (b) | | | 08/2009 | |
| Trust Preferred Tranche I | | $ | 25,774,000 | | | | 7.34 | % | | | | | | | | | 05/2035 | |
| Trust Preferred Tranche II | | $ | 25,774,000 | | | | 7.17 | % | | | | | | | | | 06/2035 | |
| Sub-Total | | $ | 552,967,736 | | | | | | | $ | 66,341,130 | | | | | | | |
| Total Consolidated Mortgage Debt | | $ | 619,308,866 | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
| Unconsolidated Joint Ventures | | | | | | | | | | | | | | | | | | |
| Courtyard - Ewing, NJ | | $ | 13,500,000 | | | | 5.54 | % | | | | | | | | | 08/2012 | |
| Courtyard - Norwich, CT | | $ | 9,400,000 | | | | 5.63 | % | | | | | | | | | 08/2015 | |
| Springhill Suites - Waterford, CT | | $ | 6,335,000 | | | | 5.63 | % | | | | | | | | | 08/2015 | |
| Residence Inn - Southington, CT | | $ | 10,950,000 | | | | 5.63 | % | | | | | | | | | 08/2015 | |
| Residence Inn - Danbury, CT | | $ | 8,050,000 | | | | 5.63 | % | | | | | | | | | 08/2015 | |
| Courtyard - Warwick, RI | | $ | 6,450,000 | | | | 5.63 | % | | | | | | | | | 08/2015 | |
| Hilton Garden Inn - Glastonbury, CT | | $ | 13,500,000 | | | | 5.98 | % | | | | | | | | | 03/2016 | |
| Marriott - Mystic, CT | | $ | 43,000,000 | | | | 6.24 | % | | | | | | | | | 11/2010 | |
| HIEXP - Madison Square Garden, NY | | $ | 55,000,000 | | | | 6.50 | % | | | | | | | | | 11/2016 | |
| HIEXP - Madison Square Garden, NY - Mezzanine Loan | | $ | 15,000,000 | | | | 10.00 | % | | | | | | | | | 11/2012 | |
| HIEXP - South Boston | | $ | 6,022,602 | | | | 6.75 | % | | | | | | | | | 01/2015 | |
| Residence Inn - Mystic, CT | | $ | 7,692,372 | | | | 6.89 | % | | | | | | | | | 02/2014 | |
| Homewood Suites Glastonbury | | $ | 12,826,359 | | | | 7.50 | % | | | | | | | | | 09/2008 | |
| Courtyard - South Boston, MA | | | | | | | | | | $ | 16,134,000 | | 30 Day LIBOR + 2.25% | | | | 10/2009 | |
| Hilton - Hartford, CT | | | | | | | | | | $ | 22,000,000 | | 30 Day LIBOR + 2.75% | | | | 11/2009 | |
| Marriott - Hartford, CT | | | | | | | | | | $ | 45,000,000 | | 30 Day LIBOR + 2.90% | | | | 02/2010 | |
| Sub-Total | | $ | 207,726,333 | | | | | | | $ | 83,134,000 | | | | | | | |
| Total Unconsolidated Joint Venture Debt | | $ | 290,860,333 | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
| (a) - Prime + 0.75% was less than the required minimum rate of 8.75% | | | | | | | | | | | | | | | | | | |
| (b) - Floating rate of 90 Day LIBOR + 2.70% was less than the required minimum rate of 8.06% | | | | | | | | | | | | | | | |
HERSHA HOSPITALITY TRUST
PORTFOLIO INFORMATION
December 31, 2007
| HOTELS BY REGION |
| | | No. | | No. |
| | | of | | of |
| | | Properties | | Rooms |
| Connecticut, RI & Other | | 14 | | 2,308 |
| New York City Metro | | 12 | | 1,624 |
| Philadelphia Metro | | 11 | | 1,234 |
| Boston Metro | | 8 | | 1,083 |
| Central PA | | 13 | | 1,261 |
| Washington DC Metro | | 7 | | 813 |
| CA/AZ Metro | | 3 | | 434 |
| Mid-Atlantic | | 3 | | 372 |
| All Regions | | 71 | | 9,129 |
| | | | | |
| HOTELS BY PROPERTY TYPE |
| | | No. | | No. |
| | | of | | of |
| | | Properties | | Rooms |
| Suburban | | 46 | | 5,263 |
| Urban | | 21 | | 3,224 |
| Airport | | 4 | | 642 |
| All Types | | 71 | | 9,129 |
| | | | | |
| HOTELS BY SEGMENT TYPE |
| | | No. | | No. |
| | | of | | of |
| | | Properties | | Rooms |
| Upper Upscale | | 3 | | 1,087 |
| Upscale Transient | | 15 | | 2,075 |
| Upscale Extended Stay | | 21 | | 2,465 |
| Midscale | | 32 | | 3,502 |
| All Segments | | 71 | | 9,129 |
Hersha Hospitality Trust
Development Loans Receivable
December 31, 2007
| | | | | Principal | | | | | |
| | | | | Outstanding | | | Interest | | Maturity |
| Hotel Property | | Borrower | | 12/31/2007 | | | Rate | | Date |
| | | | | | | | | | | | |
| Hilton Garden Inn/Homewood Suites - Brooklyn, NY | | 167 Johnson Street, LLC | | $ | 11,000,000 | | | | 11.0 | % | September 21, 2008 |
| | | | | | | | | | | | |
| Hilton Garden Inn/Homewood Suites - Brooklyn, NY | | 167 Johnson Street, LLC | | | 9,000,000 | | | | 13.5 | % | September 24, 2008 |
| | | | | | | | | | | | |
| Hilton Garden Inn - New York, NY | | York Street LLC | | | 15,000,000 | | | | 11.0 | % | July 1, 2008 |
| | | | | | | | | | | | |
| Sheraton - JFK Airport, NY | | Risingsam Hospitality, LLC | | | 10,016,000 | | | | 10.0 | % | September 30, 2008 |
| | | | | | | | | | | | |
| Boutique Hotel - Union Square, NY | | Risingsam Union Square, LLC | | | 10,000,000 | | | | 10.0 | % | May 31, 2008 |
| | | | | | | | | | | | |
| Hampton Inn & Suites - West Haven, CT | | 44 West Haven Hospitality, LLC | | | 2,000,000 | | | | 10.0 | % | October 9, 2008 |
| | | | | | | | | | | | |
| Hampton Inn - Smithfield, RI | | 44 Hersha Smithfield, LLC | | | 2,000,000 | | | | 10.0 | % | October 9, 2008 |
| | | | | | | | | | | | |
| Homewood Suites - Newtown, PA | | Reese Hotels, LLC | | | 700,000 | | | | 11.0 | % | June 1, 2008 |
| | | | | | | | | | | | |
| | | | | $ | 59,716,000 | | | | | | |
| | | | | | | | | | | | |
| Development Loan Receivable Discount | | | | | 1,533,000 | | | | | | |
| | | | | | | | | | | | |
| | | | | $ | 58,183,000 | | | | | | |
| | | | | | | | | | | | |
| | | | | | | | | | | | |
| Land Lease | | | | | | | | | | | |
| | | | | | | | | | | | |
| Boutique Hotel - 39th and 8th Avenue, NY | | Metro 39th Street Associates, LLC | | $ | 9,065,000 | | | | 10.0 | % | June 28, 2031 |
| | | | | | | | | | | | |
| Boutique Hotel - 41st and 9th Avenue, NY | | Metro Forty First Street, LLC | | $ | 9,882,000 | | | | 10.0 | % | July 28, 2031 |
| | | | | | | | | | | | |
| Boutique Hotel - Nevins St., Brooklyn, NY | | H Nevins Street Associates, LLC | | $ | 4,419,000 | | | | 10.0 | % | June 11, 2032 |
Hersha Hospitality Trust
Enterprise Value
December 31, 2007
(Dollars in thousands)
| | | December 31, | |
| | | 2007 | |
| Cash | | $ | 12,327 | |
| | | | | |
| Line of Credit | | | 43,700 | |
| Mortgages and Notes Payable - Consolidated Assets | | | 567,761 | |
| Less: JV Portion of Mortgages Payable for Consolidated JV Assets | | | (7,077 | ) |
| Mortgages Payable - HT Portion of Unconsolidated JV Assets | | | 133,024 | |
| Trust Preferred Securities | | | 51,548 | |
| | | | | |
| Series A Preferred Shares | | | 60,000 | |
| Operating Partnership Units (6,424,915 @ $9.50)* | | | 61,037 | |
| Class A Common Shares (41,203,612 @ $9.50)* | | | 391,434 | |
| | | | | |
| ENTERPRISE VALUE @ December 31, 2007 | | $ | 1,289,100 | |
| | | | | |
| * Stock price as of December 31, 2007 | | | | |
HERSHA HOSPITALITY TRUST
Unconsolidated Joint Venture EBITDA
(in thousands, except shares and per share data)
| | | | | | Hilton Garden | | | Homewood | | | | | | Holiday Inn | | | | |
| | | Courtyard | | | Inn | | | Suites | | | Courtyard | | | Express | | | Mystic | |
| | | Ewing | | | Glastonbury | | | Glastonbury | | | South Boston | | | South Boston | | | Partners | |
| Hersha Ownership | | | 50.0 | % | | | 48.0 | %* | | | 48.0 | %* | | | 50.0 | % | | | 50.0 | % | | | (66.7%,15%, 8.8 | %) |
| Hersha Participating Preferred % | | | 10.0 | % | | | 11.0 | % | | | 10.0 | % | | | N/A | ** | | | N/A | | | | 8.5 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| THREE MONTHS ENDED DECEMBER 31, 2007 | | | | | | | | | | | | | | | | | | | | | | | | |
| Joint Venture Net Income | | $ | (36 | ) | | $ | (79 | ) | | $ | (110 | ) | | $ | 23 | | | $ | 55 | | | $ | (1,517 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Hotel Cash Available for Distribution | | | | | | | | | | | | | | | | | | | | | | | | |
| Hotel EBITDA | | $ | 356 | | | $ | 346 | | | $ | 325 | | | $ | 545 | | | $ | 227 | | | $ | 4,361 | |
| Debt Service | | | (195 | ) | | | (207 | ) | | | (328 | ) | | | (400 | ) | | | (154 | ) | | | (3,704 | ) |
| Other | | | (46 | ) | | | (58 | ) | | | (26 | ) | | | (60 | ) | | | (41 | ) | | | 467 | |
| Cash Available for Distribution | | $ | 115 | | | $ | 81 | | | $ | (29 | ) | | $ | 85 | | | $ | 32 | | | $ | 1,124 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| EBITDA | | | | | | | | | | | | | | | | | | | | | | | | |
| Hersha Income from Unconsolidated JV | | $ | (19 | ) | | $ | (39 | ) | | $ | (2 | ) | | $ | (4 | ) | | $ | (1 | ) | | $ | 358 | |
| Addback: | | | | | | | | | | | | | | | | | | | | | | | | |
| Step up and Outside Basis Amortization | | | 1 | | | | 2 | | | | 2 | | | | 16 | | | | 29 | | | | 403 | |
| Adjustment for interest in interest expense, depreciation and amortization of unconsolidated joint venture | | | 196 | | | | 203 | | | | 325 | | | | 261 | | | | 86 | | | | 542 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Hersha EBITDA from Unconsolidated JV | | $ | 178 | | | $ | 166 | | | $ | 325 | | | $ | 273 | | | $ | 114 | | | $ | 1,303 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| YEAR ENDED DECEMBER 31, 2007 | | | | | | | | | | | | | | | | | | | | | | | | |
| Joint Venture Net Income | | $ | 149 | | | $ | 112 | | | $ | (677 | ) | | $ | 425 | | | $ | 369 | | | $ | (9,033 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Hotel Cash Available for Distribution | | | | | | | | | | | | | | | | | | | | | | | | |
| Hotel EBITDA | | $ | 1,744 | | | $ | 1,691 | | | $ | 1,059 | | | $ | 2,566 | | | $ | 1,036 | | | $ | 17,328 | |
| Debt Service | | | (819 | ) | | | (821 | ) | | | (1,297 | ) | | | (1,458 | ) | | | (605 | ) | | | (11,507 | ) |
| Other | | | (196 | ) | | | (216 | ) | | | (119 | ) | | | (208 | ) | | | (159 | ) | | | (1,199 | ) |
| Cash Available for Distribution | | $ | 729 | | | $ | 654 | | | $ | (357 | ) | | $ | 900 | | | $ | 272 | | | $ | 4,622 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| EBITDA | | | | | | | | | | | | | | | | | | | | | | | | |
| Hersha Income from Unconsolidated JV | | $ | 72 | | | $ | 47 | | | $ | (7 | ) | | $ | 305 | | | $ | 191 | | | $ | 1,611 | |
| Addback: | | | | | | | | | | | | | | | | | | | | | | | | |
| Step up and Outside Basis Amortization | | | 2 | | | | 6 | | | | 7 | | | | 64 | | | | 114 | | | | 1,610 | |
| Adjustment for interest in interest expense, depreciation and amortization of unconsolidated joint venture | | | 798 | | | | 724 | | | | 1,059 | | | | 1,459 | | | | 618 | | | | 8,930 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Hersha EBITDA from Unconsolidated JV | | $ | 872 | | | $ | 777 | | | $ | 1,059 | | | $ | 1,828 | | | $ | 923 | | | $ | 12,151 | |
| * | On April 1, 2007 we increased our ownership in the Hilton Garden Inn Glastonbury and the Homewood Suites Glastonbury to 48%. Prior to April 1, 2007 we owned a 40% interest in these two properties. |
| ** | On June 30, 2007 our 2 year, 10% cumulative participating preference expired. |
21
