Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Sep. 30, 2014 | Nov. 06, 2014 | |
Document And Entity Information [Abstract] | ' | ' |
Document Type | '10-Q | ' |
Amendment Flag | 'false | ' |
Document Period End Date | 30-Sep-14 | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q3 | ' |
Trading Symbol | 'MHGC | ' |
Entity Registrant Name | 'Morgans Hotel Group Co. | ' |
Entity Central Index Key | '0001342126 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 34,377,788 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
ASSETS | ' | ' |
Property and equipment, net | $281,316 | $292,629 |
Goodwill | 66,572 | 66,572 |
Investments in and advances to unconsolidated joint ventures | 10,492 | 10,492 |
Cash and cash equivalents | 96,284 | 10,025 |
Restricted cash | 16,234 | 22,144 |
Accounts receivable, net | 15,388 | 18,384 |
Related party receivables | 3,811 | 3,694 |
Prepaid expenses and other assets | 7,962 | 10,409 |
Deferred tax asset, net | 78,896 | 78,758 |
Investment in TLG management contracts, net | 19,376 | 23,702 |
Other assets, net | 35,937 | 34,398 |
Total assets | 632,268 | 571,207 |
LIABILITIES AND STOCKHOLDERS’ DEFICIT | ' | ' |
Debt and capital lease obligations | 673,638 | 560,751 |
Accounts payable and accrued liabilities | 38,642 | 41,627 |
Deferred gain on asset sales | 127,403 | 133,419 |
Other liabilities | 13,866 | 13,891 |
Total liabilities | 853,549 | 749,688 |
Redeemable noncontrolling interest | 4,606 | 4,953 |
Commitments and contingencies | ' | ' |
Preferred stock, $0.01 par value; liquidation preference $1,000 per share, 75,000 shares authorized and issued at September 30, 2014 and December 31, 2013, respectively | 65,675 | 62,004 |
Common stock, $0.01 par value; 200,000,000 shares authorized; 36,277,495 shares issued at September 30, 2014 and December 31, 2013, respectively | 363 | 363 |
Additional paid-in capital | 241,346 | 252,810 |
Treasury stock, at cost, 1,899,707 and 2,703,181 shares of common stock at September 30, 2014 and December 31, 2013, respectively | -23,708 | -37,086 |
Accumulated other comprehensive loss | -202 | -10 |
Accumulated deficit | -509,753 | -462,005 |
Total Morgans Hotel Group Co. stockholders’ deficit | -226,279 | -183,924 |
Noncontrolling interest | 392 | 490 |
Total deficit | -225,887 | -183,434 |
Total liabilities, redeemable noncontrolling interest and stockholders’ deficit | $632,268 | $571,207 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
Statement Of Financial Position [Abstract] | ' | ' |
Preferred stock, par value | $0.01 | $0.01 |
Preferred stock, liquidation preference per share | $1,000 | $1,000 |
Preferred stock, share authorized | 75,000 | 75,000 |
Preferred stock, share issued | 75,000 | 75,000 |
Common stock, par value | $0.01 | $0.01 |
Common stock, share authorized | 200,000,000 | 200,000,000 |
Common stock, share issued | 36,277,495 | 36,277,495 |
Treasury stock, shares | 1,899,707 | 2,703,181 |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Loss (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Revenues: | ' | ' | ' | ' |
Rooms | $30,648 | $29,950 | $90,760 | $87,303 |
Food and beverage | 18,252 | 20,214 | 61,177 | 59,713 |
Other hotel | 1,347 | 1,142 | 4,132 | 3,384 |
Total hotel revenues | 50,247 | 51,306 | 156,069 | 150,400 |
Management fee-related parties and other income | 5,259 | 6,956 | 16,509 | 21,220 |
Total revenues | 55,506 | 58,262 | 172,578 | 171,620 |
Operating Costs and Expenses: | ' | ' | ' | ' |
Rooms | 9,357 | 9,253 | 27,896 | 27,298 |
Food and beverage | 14,266 | 15,827 | 44,834 | 44,335 |
Other departmental | 800 | 806 | 2,369 | 2,422 |
Hotel selling, general and administrative | 9,702 | 11,046 | 31,404 | 32,688 |
Property taxes, insurance and other | 3,908 | 4,080 | 12,154 | 12,641 |
Total hotel operating expenses | 38,033 | 41,012 | 118,657 | 119,384 |
Corporate expenses, including stock compensation of $0.3 million, $1.3 million, $3.1 million, and $3.6 million, respectively | 7,126 | 6,754 | 21,027 | 22,469 |
Depreciation and amortization | 6,811 | 7,114 | 21,894 | 20,535 |
Restructuring and disposal costs | 1,145 | 1,799 | 12,369 | 7,951 |
Development costs | 564 | 971 | 3,928 | 2,368 |
Impairment loss on receivables and other assets from managed hotel and unconsolidated joint venture | ' | 167 | ' | 5,942 |
Total operating costs and expenses | 53,679 | 57,817 | 177,875 | 178,649 |
Operating income (loss) | 1,827 | 445 | -5,297 | -7,029 |
Interest expense, net | 12,984 | 11,585 | 41,917 | 34,434 |
Equity in (income) loss of unconsolidated joint ventures | -3 | 278 | -7 | 773 |
Gain on asset sales | -2,005 | -2,005 | -6,015 | -6,015 |
Other non-operating expenses | 824 | 810 | 1,950 | 1,289 |
Loss before income tax expense | -9,973 | -10,223 | -43,142 | -37,510 |
Income tax expense | 122 | 105 | 351 | 541 |
Net loss | -10,095 | -10,328 | -43,493 | -38,051 |
Net (income) loss attributable to noncontrolling interest | -48 | ' | -504 | 298 |
Net loss attributable to Morgans Hotel Group | -10,143 | -10,328 | -43,997 | -37,753 |
Preferred stock dividends and accretion | 3,594 | 4,037 | 11,948 | 9,976 |
Net loss attributable to common stockholders | -13,737 | -14,365 | -55,945 | -47,729 |
Other comprehensive income (loss): | ' | ' | ' | ' |
Unrealized gain (loss) on valuation of swap/cap agreements, net of tax | 16 | 9 | -191 | 41 |
Comprehensive loss | ($13,721) | ($14,356) | ($56,136) | ($47,688) |
Loss per share: | ' | ' | ' | ' |
Basic and diluted attributable to common stockholders | ($0.40) | ($0.44) | ($1.64) | ($1.46) |
Weighted average number of common shares outstanding: | ' | ' | ' | ' |
Basic and diluted | 34,267 | 32,693 | 34,047 | 32,590 |
Consolidated_Statements_of_Com1
Consolidated Statements of Comprehensive Loss (Parenthetical) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Income Statement [Abstract] | ' | ' | ' | ' |
Stock compensation | $0.30 | $1.30 | $3.10 | $3.60 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 |
Cash flows from operating activities: | ' | ' |
Net loss | ($43,493) | ($38,051) |
Adjustments to reconcile net loss to net cash used in operating activities: | ' | ' |
Depreciation | 14,884 | 15,224 |
Amortization of other costs | 7,009 | 5,311 |
Amortization and write off of deferred financing costs | 5,714 | 4,563 |
Amortization of discount on convertible notes | 1,030 | 1,707 |
Amortization of deferred gain on asset sales | -6,015 | -6,015 |
Stock-based compensation | 3,096 | 3,552 |
Accretion of interest | 2,383 | 2,158 |
Equity in (income) losses from unconsolidated joint ventures | -7 | 773 |
Impairment loss on receivables from managed hotel and unconsolidated joint venture | 0 | 5,942 |
Impairment loss and loss on disposal of assets | 0 | 273 |
Gain on transfer and disposal of assets | -280 | 0 |
Change in fair value of TLG Promissory Notes | 5 | 60 |
Change in fair value of interest rate caps, net | 0 | 42 |
Changes in assets and liabilities: | ' | ' |
Accounts receivable, net | 2,642 | -2,801 |
Related party receivables | -117 | 874 |
Restricted cash | 7,189 | -1,095 |
Prepaid expenses and other assets | 2,258 | -640 |
Accounts payable and accrued liabilities | -1,494 | 4,476 |
Net cash used in operating activities | -5,196 | -3,647 |
Cash flows from investing activities: | ' | ' |
Additions to property and equipment | -3,949 | -9,056 |
Additions to leasehold interests | 0 | -208 |
Investment in hotel development | 3,000 | -375 |
Investments in and settlement related to unconsolidated joint ventures | 0 | -151 |
(Deposits) withdrawals from capital improvement escrows, net | -1,279 | 1,700 |
Distributions from unconsolidated joint ventures | 6 | 7 |
Net cash used in investing activities | -2,222 | -8,083 |
Cash flows from financing activities: | ' | ' |
Proceeds from debt | 450,000 | 22,000 |
Payments on debt and capital lease obligations | -341,542 | -6,998 |
Debt issuance costs | -13,271 | -265 |
Cash paid in connection with vesting of stock based awards | -797 | -545 |
Distributions to holders of noncontrolling interests in consolidated subsidiaries | -713 | -703 |
Net cash provided by financing activities | 93,677 | 13,489 |
Net increase in cash and cash equivalents | 86,259 | 1,759 |
Cash and cash equivalents, beginning of year | 10,025 | 5,847 |
Cash and cash equivalents, end of year | 96,284 | 7,606 |
Supplemental disclosure of cash flow information: | ' | ' |
Cash paid for interest | 34,848 | 26,273 |
Cash paid for taxes | 564 | 150 |
Non cash financing activities: | ' | ' |
Write off of discount on convertible debt | $726 | $0 |
Organization_and_Formation_Tra
Organization and Formation Transaction | 9 Months Ended | |||||||||
Sep. 30, 2014 | ||||||||||
Organization Consolidation And Presentation Of Financial Statements [Abstract] | ' | |||||||||
Organization and Formation Transaction | ' | |||||||||
1. Organization and Formation Transaction | ||||||||||
Morgans Hotel Group Co., a Delaware corporation (the “Company”), was incorporated on October 19, 2005. The Company operates, owns, acquires and redevelops boutique hotels primarily in gateway cities and select resort markets in the United States, Europe and other international locations, and nightclubs, restaurants, pool lounges, bars and other food and beverage venues in many of the hotels it operates, as well as in hotels and casinos operated by MGM Resorts International (“MGM”) in Las Vegas. | ||||||||||
The Morgans Hotel Group Co. predecessor comprised the subsidiaries and ownership interests that were contributed as part of the formation and structuring transactions from Morgans Hotel Group LLC, now known as Residual Hotel Interest LLC (“Former Parent”), to Morgans Group LLC (“Morgans Group”), the Company’s operating company. The Former Parent also contributed all the membership interests in its hotel management business to Morgans Group in return for 1,000,000 membership units in Morgans Group exchangeable for shares of the Company’s common stock. | ||||||||||
The Company has one reportable operating segment; it operates, owns, acquires, develops and redevelops boutique hotels, nightclubs, restaurants, pool lounges, bars and other food and beverage venues in many of the hotels it operates, as well as in hotels and casinos operated by MGM in Las Vegas. During the nine months ended September 30, 2014 and 2013, the Company derived 5.5% and 10.5% of its total revenues from international locations, respectively. The assets at these international locations were not significant during the periods presented. | ||||||||||
Hotels | ||||||||||
The Company’s hotels as of September 30, 2014 were as follows: | ||||||||||
Hotel Name | Location | Number of | Ownership | |||||||
Rooms | ||||||||||
Hudson | New York, NY | 876 | (1 | ) | ||||||
Morgans | New York, NY | 117 | (2 | ) | ||||||
Royalton | New York, NY | 168 | (2 | ) | ||||||
Mondrian SoHo | New York, NY | 263 | (3 | ) | ||||||
Delano South Beach | Miami Beach, FL | 194 | (4 | ) | ||||||
Mondrian South Beach | Miami Beach, FL | 214 | (5 | ) | ||||||
Shore Club | Miami Beach, FL | 308 | (6 | ) | ||||||
Mondrian Los Angeles | Los Angeles, CA | 236 | (2 | ) | ||||||
Clift | San Francisco, CA | 372 | (7 | ) | ||||||
Sanderson | London, England | 150 | (2 | ) | ||||||
St Martins Lane | London, England | 204 | (2 | ) | ||||||
Mondrian London at Sea Containers | London, England | 359 | (2 | ) | ||||||
Delano Las Vegas | Las Vegas, Nevada | 1,117 | (8 | ) | ||||||
-1 | The Company owns 100% of Hudson through its subsidiary, Henry Hudson Holdings LLC, which is part of a property that is structured as a condominium, in which Hudson constitutes 96% of the square footage of the entire building. As of September 30, 2014, Hudson had 876 guest rooms and 60 single room dwelling units (“SROs”). | |||||||||
-2 | Operated under a management contract. | |||||||||
-3 | Operated under a management contract and owned through an unconsolidated joint venture in which the Company held a minority ownership interest of approximately 20% at September 30, 2014. See note 4. | |||||||||
-4 | Wholly-owned hotel. | |||||||||
-5 | Operated as a condominium hotel under a management contract and owned through a 50/50 unconsolidated joint venture. As of September 30, 2014, 261 hotel residences had been sold, of which 140 are in the hotel rental pool and are included in the hotel room count, and 74 hotel residences remain to be sold. See note 4. | |||||||||
-6 | Operated under a management contract. Until December 30, 2013, the Company held a minority ownership interest of approximately 7% and accounted for the hotel as an unconsolidated joint venture. As of September 30, 2014, the Company had an immaterial contingent profit participation equity interest in Shore Club. See note 4. | |||||||||
-7 | The hotel is operated under a long-term lease which is accounted for as a financing. See note 6. | |||||||||
-8 | A licensed hotel managed by MGM. | |||||||||
Food and Beverage Operations | ||||||||||
The Company owns and operates certain food and beverage venues at its owned, leased and managed hotels. As of September 30, 2014, the Company owned and managed the food and beverage venues at Hudson and Clift and owned the food and beverage venues at Delano South Beach, which are managed by TLG, defined and discussed further below. Additionally, the Company leases and manages all but one of the Sanderson food and beverage venues. As a result, these food and beverage venues are included in the Company’s consolidated financial statements. | ||||||||||
Effective January 1, 2014, the Company transferred all of its ownership interest in the food and beverage venues at St Martins Lane to the hotel owner. The Company will continue to manage the transferred food and beverage venues. The Company recorded a gain of $0.3 million related to these transfers in its consolidated financial statements for the nine months ended September 30, 2014. Prior to January 1, 2014, the Company leased and managed all of the St Martins Lane food and beverage venues, which were included in the Company’s consolidated financial statements. | ||||||||||
The Company also owns three food and beverage venues subject to leasehold agreements at Mandalay Bay in Las Vegas, which are included the Company’s consolidated financial statements as of September 30, 2014. | ||||||||||
The Light Group Acquisition | ||||||||||
On November 30, 2011, pursuant to purchase agreements entered into on November 17, 2011, certain of the Company’s subsidiaries completed the acquisition of 90% of the equity interests in TLG Acquisition LLC (“TLG Acquisition,” and together with its subsidiaries, “TLG”), for a purchase price of $28.5 million in cash and up to $18.0 million in notes (the “TLG Promissory Notes”) convertible into shares of the Company’s common stock at $9.50 per share subject to the achievement of certain earnings before interest, tax, depreciation and amortization (“EBITDA”) targets for the acquired business (“The Light Group Transaction”), as discussed in note 6. The TLG Promissory Notes were allocated $16.0 million to Andrew Sasson and $2.0 million to Andy Masi, the remaining 10% equity owners of TLG, and bear annual interest payments of 8% (increasing to 18% on December 1, 2014, as described in note 6). | ||||||||||
TLG develops, redevelops and operates nightclubs, restaurants, pool lounges, bars, and other food and beverage venues. TLG is a leading lifestyle food and beverage management company, which operates numerous venues primarily in Las Vegas pursuant to management agreements with MGM. The primary assets of TLG consist of its management and similar agreements with various MGM affiliates. Additionally, TLG manages the food and beverage operations at Delano South Beach. | ||||||||||
Each of TLG’s venues is managed by a subsidiary of TLG Acquisition. Through the Company’s ownership of TLG, it recognizes management fees in accordance with the applicable management agreement which generally provides for base management fees as a percentage of gross sales, and incentive management fees as a percentage of net profits, as calculated pursuant to the management agreements. TLG’s management agreements are typically structured as 10-year initial term contracts (effective the opening date of each respective venue) with renewal options. In addition to TLG’s management of the food and beverage operations at Delano South Beach, TLG currently manages 18 venues in Las Vegas, including 13 for MGM, 2 for affiliates of The Yucaipa Companies, LLC (“Yucaipa”) and Andrew Sasson, and 3 for a subsidiary of the Company located at Delano South Beach. Under TLG’s management agreements, all costs associated with the construction, build-out, furniture, fixtures and equipment, operating supplies, equipment and daily operational expenses are typically borne by the owner or lessor of the venue. TLG’s management agreements may be subject to early termination in specified circumstances. For example, the management agreements generally contain, among other covenants, a performance test that stipulates a minimum level of operating performance, and restrictions or requirements related to suitability, capacity, financial stability and compliance with laws and material terms. In 2013, TLG failed performance tests at certain venues, and as a result, the Company agreed with MGM to amend the calculation of base and incentive management fees at all MGM venues effective January 1, 2014, agreed to reductions in the minimum level of operating performance, and agreed to a termination effective April 1, 2014 of TLG’s management agreement for Brand Steakhouse. Additionally, many of the management agreements also require that Mr. Masi, whose employment contract expires December 31, 2014, remain employed by or under contract to TLG. | ||||||||||
TLG owns the trade name, service mark or other intellectual property rights associated with the names of most of its nightclubs, restaurants, pool lounges, and bars. | ||||||||||
Concurrent with the closing of The Light Group Transaction, the operating agreement of TLG Acquisition was amended and restated to provide that Morgans Group, which holds 90% of the membership interests in TLG Acquisition, would be the managing member and that Messrs. Sasson and Masi, each of whom holds a 5% membership interest in TLG Acquisition, would be non-managing members of TLG Acquisition. Messrs. Sasson and Masi, however, have approval rights over, among other things, certain fundamental transactions involving TLG Acquisition. | ||||||||||
Each of Messrs. Sasson and Masi have the right to require Morgans Group to purchase his equity interest in TLG at any time after November 30, 2014 at a purchase price equal to his percentage equity ownership interest multiplied by the product of seven times the EBITDA from non-Morgans business (“Non-Morgans EBITDA”) for the preceding 12 months, subject to certain adjustments (the “Sasson-Masi Put Options”). In addition, Morgans Group has the right to require each of Messrs. Sasson and Masi to sell his 5% equity interest in TLG at any time after November 30, 2017 at a purchase price equal to his percentage equity ownership interest multiplied by the product of seven times the Non-Morgans EBITDA for the preceding 12 months, subject to certain adjustments. The Company initially accounted for the redeemable noncontrolling interest at fair value in accordance with Accounting Standard Codification (“ASC”) 805, Business Combinations. Due to the redemption feature associated with the Sasson-Masi Put Options, the Company classified the noncontrolling interest in temporary equity in accordance with the Securities and Exchange Commission’s guidance as codified in ASC 480-10, Distinguishing Liabilities from Equity. Subsequently, the Company will accrete the redeemable noncontrolling interest to its current redemption value, which approximates fair value, each period. The change in the redemption value does not impact the Company’s earnings or earnings per share. The Company recorded an obligation of $4.6 million related to the Sasson-Masi Put Options, which is recorded as redeemable noncontrolling interest on the September 30, 2014 consolidated balance sheet. |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2014 | |
Accounting Policies [Abstract] | ' |
Summary of Significant Accounting Policies | ' |
2. Summary of Significant Accounting Policies | |
Basis of Presentation | |
The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The Company consolidates all wholly-owned subsidiaries and variable interest entities in which the Company is determined to be the primary beneficiary. All intercompany balances and transactions have been eliminated in consolidation. Entities which the Company does not control through voting interest and entities which are variable interest entities of which the Company is not the primary beneficiary, are accounted for under the equity method. | |
The consolidated financial statements have been prepared in accordance with GAAP for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. The information furnished in the accompanying consolidated financial statements reflects all adjustments that, in the opinion of management, are necessary for a fair presentation of the aforementioned consolidated financial statements for the interim periods. | |
Operating results for the three and nine months ended September 30, 2014 are not necessarily indicative of the results that may be expected for the year ending December 31, 2014. For further information, refer to the consolidated financial statements and accompanying footnotes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013. | |
Use of Estimates | |
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. | |
Restricted Cash | |
As required by certain debt and lease agreements, restricted cash consists of cash held in escrow accounts for taxes, ground rent, insurance premiums, and debt service or lease payments. | |
The Hudson/Delano 2014 Mortgage Loan, defined and discussed below in note 6, provides that, in the event the debt yield ratio falls below certain defined thresholds, all cash flows from Hudson and Delano South Beach are deposited into accounts controlled by the lenders from which debt service and operating expenses, including management fees, are paid and from which other reserve accounts may be funded. Any excess amounts will be retained by the lenders until the debt yield ratio exceeds the required thresholds for two consecutive calendar quarters. As of September 30, 2014, the debt yield ratio exceeded the required threshold. | |
As further required by the debt and lease agreements related to hotels owned by the Company or one of its subsidiaries, the Company must set aside 4% of the hotels’ revenues in restricted escrow accounts for the future periodic replacement or refurbishment of furniture, fixtures and equipment. As replacements occur, the Company or its subsidiary is eligible for reimbursement from these escrow accounts. | |
As of September 30, 2014, restricted cash also consisted of cash held in escrow for insurance program escrows. | |
Investments in and Advances to Unconsolidated Joint Ventures | |
The Company accounts for its investments in unconsolidated joint ventures using the equity method as it does not exercise control over significant business decisions such as buying, selling or financing nor is it the primary beneficiary under ASC 810-10, as discussed above. Under the equity method, the Company increases its investment for its proportionate share of net income and contributions to the joint venture and decreases its investment balance by recording its proportionate share of net loss and distributions. Once the Company’s investment balance in an unconsolidated joint venture is zero, the Company suspends recording additional losses. For investments in which there is recourse or unfunded commitments to provide additional equity, distributions and losses in excess of the investment are recorded as a liability. As of September 30, 2014, there were no liabilities required to be recorded related to these investments. | |
Investment in TLG Management Contracts, net | |
Investment in TLG management contracts represents the value of the TLG management contracts. TLG operates numerous nightclubs, restaurants, pool lounges, and bar venues primarily in Las Vegas pursuant to management agreements with MGM. The management contract assets are being amortized, using the straight line method, over the life of each applicable management contract. | |
Other Assets | |
In August 2012, the Company entered into a 10-year licensing agreement with MGM, with two five-year extensions at the Company’s option subject to performance thresholds, to convert THEhotel to Delano Las Vegas, which is managed by MGM. Delano Las Vegas opened in September 2014. In addition, the Company acquired the leasehold interests in three food and beverage venues at Mandalay Bay in Las Vegas from an existing tenant for $15.0 million in cash at closing and a deferred, principal-only $10.6 million promissory note (“Restaurant Lease Note”) to be paid over seven years, which the Company recorded at fair value as of the date of issuance of $7.5 million, as discussed in note 6. The venues have been reconcepted and renovated and are managed by TLG. The three food and beverage venues are being operated pursuant to 10-year operating leases with an MGM affiliate, pursuant to which the Company pays minimum annual lease payments and a percentage rent based on cash flow. The Company allocated the total consideration paid, or to be paid, to the license agreement and the restaurant leasehold asset based on their respective fair values. The Company amortizes the fair value of the license agreement, using the straight line method, over the 10-year life of the license agreement, and the fair value of the restaurant leasehold interests, using the straight line method, over the 10-year life of the operating leases. | |
Further, as of September 30, 2014, other assets primarily consist of deferred financing costs which are being amortized, using the straight line method, which approximates the effective interest rate method, over the terms of the related debt agreements. | |
Income Taxes | |
The Company accounts for income taxes in accordance with ASC 740-10, Income Taxes, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the tax and financial reporting basis of assets and liabilities and for loss and credit carry forwards. Valuation allowances are provided when it is more likely than not that the recovery of deferred tax assets will not be realized. | |
The Company’s deferred tax assets are recorded net of a valuation allowance when, based on the weight of available evidence, it is more likely than not that some portion or all of the recorded deferred tax assets will not be realized in future periods. Decreases to the valuation allowance are recorded as reductions to the Company’s provision for income taxes and increases to the valuation allowance result in additional provision for income taxes. The realization of the Company’s deferred tax assets, net of the valuation allowance, is primarily dependent on estimated future taxable income. A change in the Company’s estimate of future taxable income may require an addition to or reduction from the valuation allowance. The Company has established a reserve on its deferred tax assets based on anticipated future taxable income and tax strategies which may include the sale of property or an interest therein. | |
All of the Company’s foreign subsidiaries are subject to local jurisdiction corporate income taxes. Income tax expense is reported at the applicable rate for the periods presented. | |
Income taxes for the three and nine months ended September 30, 2014 and 2013, were computed using the Company’s effective tax rate. | |
Credit-risk-related Contingent Features | |
The Company entered into agreements with each of its derivative counterparties in connection with the interest rate caps and hedging instruments related to the 2.375% Senior Subordinated Convertible Notes (the “Convertible Notes”), as discussed in note 6, which were outstanding as of September 30, 2014 and which matured and were repaid in full on October 15, 2014. The agreements provided that in the event the Company either defaulted or was capable of being declared in default on any of its indebtedness, the Company could also be declared in default on its derivative obligations. These Convertible Notes Call Options and Convertible Notes Warrants, as discussed and defined in note 6, expired when the Convertible Notes were repaid in October 2014. | |
The Company has entered into warrant agreements with Yucaipa American Alliance Fund II, L.P. and Yucaipa American Alliance (Parallel) Fund II, L.P., (collectively, the “Yucaipa Investors”), as discussed in note 9, to purchase a total of 12,500,000 shares of the Company’s common stock at an exercise price of $6.00 per share (the “Yucaipa Warrants”). In addition, the Yucaipa Investors have certain consent rights over certain transactions for so long as they collectively own or have the right to purchase through exercise of the Yucaipa Warrants 6,250,000 shares of the Company’s common stock. The Yucaipa Warrants are exercisable utilizing a cashless exercise method only, resulting in a net share issuance. | |
Fair Value Measurements | |
ASC 820-10, Fair Value Measurements and Disclosures (“ASC 820-10”) defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. ASC 820-10 applies to reported balances that are required or permitted to be measured at fair value under existing accounting pronouncements; accordingly, the standard does not require any new fair value measurements of reported balances. | |
ASC 820-10 emphasizes that fair value is a market-based measurement, not an entity-specific measurement. Therefore, a fair value measurement should be determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, ASC 820-10 establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy). | |
Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access. Level 2 inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs may include quoted prices for similar assets and liabilities in active markets, as well as inputs that are observable for the asset or liability (other than quoted prices), such as interest rates and yield curves that are observable at commonly quoted intervals. Level 3 inputs are unobservable inputs for the asset or liability, which is typically based on an entity’s own assumptions, as there is little, if any, related market activity. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the asset or liability. | |
Currently, the Company uses interest rate caps to manage its interest rate risk. The valuation of these instruments is determined using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities. To comply with the provisions of ASC 820-10, the Company incorporates credit valuation adjustments to appropriately reflect both its own nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements. In adjusting the fair value of its derivative contracts for the effect of nonperformance risk, the Company has considered the impact of netting and any applicable credit enhancements, such as collateral postings, thresholds, mutual puts, and guarantees. Although the Company has determined that the majority of the inputs used to value its derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with its derivatives utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by itself and its counterparties. However, as of September 30, 2014 and December 31, 2013, the Company assessed the significance of the impact of the credit valuation adjustments on the overall valuation of its derivative positions and determined that the credit valuation adjustments are not significant to the overall valuation of its derivatives. Accordingly, all derivatives have been classified as Level 2 fair value measurements. As of September 30, 2014, the Company had three interest rate caps outstanding and the fair value of these interest rate caps was $0.2 million. | |
In connection with The Light Group Transaction, the Company provided Messrs. Sasson and Masi with the Sasson-Masi Put Options. Due to the redemption feature associated with the Sasson-Masi Put Options, the Company classified the noncontrolling interest in temporary equity. Subsequently, the Company will accrete the redeemable noncontrolling interest to its current redemption value, which approximates fair value, each period. The Company has determined that the majority of the inputs used to value the Sasson-Masi Put Options fall within Level 3 of the fair value hierarchy. Accordingly, the Sasson-Masi Put Options have been classified as Level 3 fair value measurements. | |
In connection with the three restaurant leases in Las Vegas, the Company issued the Restaurant Lease Note to be paid over seven years. The Restaurant Lease Note does not bear interest except in the event of default, as defined by the agreement. In accordance with ASC 470, Debt, the Company imputed interest on the Restaurant Lease Note, which is recorded at fair value on the accompanying consolidated balance sheets. On the date of grant, the Company determined the fair value of the Restaurant Lease Note to be $7.5 million imputing an interest rate of 10%. The Company has determined that the majority of the inputs used to value the Restaurant Lease Note fall within Level 2 of the fair value hierarchy, which accordingly has been classified as Level 2 fair value measurements. | |
Fair Value of Financial Instruments | |
Disclosures about fair value of financial instruments are based on pertinent information available to management as of the valuation date. Considerable judgment is necessary to interpret market data and develop estimated fair values. Accordingly, the estimates presented are not necessarily indicative of the amounts at which these instruments could be purchased, sold, or settled. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts. | |
The Company’s financial instruments include cash and cash equivalents, accounts receivable, restricted cash, accounts payable and accrued liabilities, and fixed and variable rate debt. Management believes the carrying amounts of the aforementioned financial instruments, excluding fixed-rate debt, is a reasonable estimate of fair value as of September 30, 2014 and December 31, 2013 due to the short-term maturity of these instruments or variable market interest rates on certain debt instruments. | |
The Company had fixed rate debt of $123.1 million and $247.1 million as of September 30, 2014 and December 31, 2013, respectively, which included the Company’s trust preferred securities, TLG Promissory Notes, excluding accrued interest, Restaurant Lease Note, discussed above, and the Convertible Notes at face value, as discussed in note 6. This fixed rate debt had a fair market value at September 30, 2014 and December 31, 2013 of approximately $136.0 million and $217.7 million, respectively, using market rates. | |
Stock-based Compensation | |
The Company accounts for stock based employee compensation using the fair value method of accounting described in ASC 718-10. For share grants, total compensation expense is based on the price of the Company’s stock at the grant date. For option grants, the total compensation expense is based on the estimated fair value using the Black-Scholes option-pricing model. Compensation expense is recorded ratably over the vesting period. | |
Income (Loss) Per Share | |
Basic net income (loss) per common share is calculated by dividing net income (loss) available to common stockholders, less any dividends on unvested restricted common stock, by the weighted-average number of shares of common stock outstanding during the period. Diluted net income (loss) per common share is calculated by dividing net income (loss) available to common stockholders, less dividends on unvested restricted common stock, by the weighted-average number of shares of common stock outstanding during the period, plus other potentially dilutive securities, such as unvested shares of restricted common stock and warrants. | |
Redeemable Noncontrolling Interest | |
Due to the redemption feature associated with the Sasson-Masi Put Options, the Company classifies the noncontrolling interest in temporary equity in accordance with the Securities and Exchange Commission’s guidance as codified in ASC 480-10, Distinguishing Liabilities from Equity. Subsequently, the Company will accrete the redeemable noncontrolling interest to its current redemption value, which approximates fair value, each period. The change in the redemption value does not impact the Company’s earnings or earnings per share. | |
Noncontrolling Interest | |
The Company follows ASC 810-10, when accounting and reporting for noncontrolling interests in a consolidated subsidiary and the deconsolidation of a subsidiary. Under ASC 810-10, the Company reports noncontrolling interests in subsidiaries as a separate component of stockholders’ equity (deficit) in the consolidated financial statements and reflects net income (loss) attributable to the noncontrolling interests and net income (loss) attributable to the common stockholders on the face of the consolidated statements of comprehensive loss. | |
The membership units owned by the Former Parent in Morgans Group are presented as a noncontrolling interest in Morgans Group in the consolidated balance sheets and were approximately $0.4 million and $0.5 million as of September 30, 2014 and December 31, 2013, respectively. The noncontrolling interest in Morgans Group is: (i) increased or decreased by the holders of membership interests’ pro rata share of Morgans Group’s net income or net loss, respectively; (ii) decreased by distributions; (iii) decreased by exchanges of membership units for the Company’s common stock; and (iv) adjusted to equal the net equity of Morgans Group multiplied by the holders of membership interests’ ownership percentage immediately after each issuance of units of Morgans Group and/or shares of the Company’s common stock and after each purchase of treasury stock through an adjustment to additional paid-in capital. Net income or net loss allocated to the noncontrolling interest in Morgans Group is based on the weighted-average percentage ownership throughout the period. As of September 30, 2014, there were 75,446 membership units outstanding, each of which is exchangeable for a share of the Company’s common stock. | |
Reclassifications | |
Certain prior period financial statement amounts have been reclassified to conform to the current period presentation. |
Income_Loss_Per_Share
Income (Loss) Per Share | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Earnings Per Share [Abstract] | ' | |||||||
Income (Loss) Per Share | ' | |||||||
3. Income (Loss) Per Share | ||||||||
The Company applies the two-class method as required by ASC 260-10, Earnings per Share (“ASC 260-10”). ASC 260-10 requires the net income per share for each class of stock (common stock and preferred stock) to be calculated assuming 100% of the Company’s net income is distributed as dividends to each class of stock based on their contractual rights. To the extent the Company has undistributed earnings in any calendar quarter, the Company will follow the two-class method of computing earnings per share. | ||||||||
Basic earnings (loss) per share is calculated based on the weighted average number of shares of common stock outstanding during the period. Diluted earnings (loss) per share include the effect of potential shares outstanding, including dilutive securities. Potential dilutive securities may include shares and options granted under the Company’s stock incentive plan and membership units in Morgans Group, which may be exchanged for shares of the Company’s common stock under certain circumstances. The 75,446 Morgans Group membership units (which may be converted to cash, or at the Company’s option, common stock) held by third parties at September 30, 2014, Yucaipa Warrants (as defined in note 9) issued to the Yucaipa Investors, unvested restricted stock units, LTIP Units (as defined in note 8), stock options, OPP LTIP Units (as defined in note 8) and shares issuable upon conversion of outstanding Convertible Notes have been excluded from the diluted net income (loss) per common share calculation, as there would be no effect on reported diluted net income (loss) per common share. | ||||||||
The table below details the components of the basic and diluted loss per share calculations (in thousands, except for per share data). The Company has not had any undistributed earnings in any calendar quarter presented. Therefore, the Company does not present earnings per share following the two-class method. | ||||||||
Three Months | Three Months | |||||||
Ended | Ended | |||||||
30-Sep-14 | 30-Sep-13 | |||||||
Numerator: | ||||||||
Net loss | $ | (10,095 | ) | $ | (10,328 | ) | ||
Net (income) loss attributable to noncontrolling interest | (48 | ) | - | |||||
Net loss attributable to Morgans Hotel Group Co. | (10,143 | ) | (10,328 | ) | ||||
Less: preferred stock dividends and accretion | 3,594 | 4,037 | ||||||
Net loss attributable to common stockholders | $ | (13,737 | ) | $ | (14,365 | ) | ||
Denominator, continuing and discontinued operations: | ||||||||
Weighted average basic common shares outstanding | 34,267 | 32,693 | ||||||
Effect of dilutive securities | — | — | ||||||
Weighted average diluted common shares outstanding | 34,267 | 32,693 | ||||||
Basic and diluted loss available to common stockholders per common share | $ | (0.40 | ) | $ | (0.44 | ) | ||
Nine Months | Nine Months | |||||||
Ended | Ended | |||||||
30-Sep-14 | 30-Sep-13 | |||||||
Numerator: | ||||||||
Net loss | $ | (43,493 | ) | $ | (38,051 | ) | ||
Net (income) loss attributable to noncontrolling interest | (504 | ) | 298 | |||||
Net loss attributable to Morgans Hotel Group Co. | (43,997 | ) | (37,753 | ) | ||||
Less: preferred stock dividends and accretion | 11,948 | 9,976 | ||||||
Net loss attributable to common stockholders | $ | (55,945 | ) | $ | (47,729 | ) | ||
Denominator, continuing and discontinued operations: | ||||||||
Weighted average basic common shares outstanding | 34,047 | 32,590 | ||||||
Effect of dilutive securities | — | — | ||||||
Weighted average diluted common shares outstanding | 34,047 | 32,590 | ||||||
Basic and diluted loss available to common stockholders per common share | $ | (1.64 | ) | $ | (1.46 | ) | ||
Investments_in_and_Advances_to
Investments in and Advances to Unconsolidated Joint Ventures | 9 Months Ended | |||||||||||||||
Sep. 30, 2014 | ||||||||||||||||
Equity Method Investments And Joint Ventures [Abstract] | ' | |||||||||||||||
Investments in and Advances to Unconsolidated Joint Ventures | ' | |||||||||||||||
4. Investments in and Advances to Unconsolidated Joint Ventures | ||||||||||||||||
The Company’s investments in and advances to unconsolidated joint ventures and its equity in income (losses) of unconsolidated joint ventures are summarized as follows (in thousands): | ||||||||||||||||
Investments | ||||||||||||||||
Entity | As of | As of | ||||||||||||||
September 30, | December 31, | |||||||||||||||
2014 | 2013 | |||||||||||||||
Mondrian Istanbul | $ | 10,392 | $ | 10,392 | ||||||||||||
Other | 100 | 100 | ||||||||||||||
Total investments in and advances to unconsolidated joint | $ | 10,492 | $ | 10,492 | ||||||||||||
ventures | ||||||||||||||||
Equity in income (losses) of unconsolidated joint ventures | ||||||||||||||||
Three Months | Three Months | Nine Months | Nine Months | |||||||||||||
Ended | Ended | Ended | Ended | |||||||||||||
30-Sep-14 | 30-Sep-13 | 30-Sep-14 | 30-Sep-13 | |||||||||||||
Mondrian South Beach food and | $ | — | $ | (281 | ) | $ | — | $ | (629 | ) | ||||||
beverage—MC South Beach | ||||||||||||||||
Other | 3 | 3 | 7 | (144 | ) | |||||||||||
Total | $ | 3 | $ | (278 | ) | $ | 7 | $ | (773 | ) | ||||||
Mondrian South Beach | ||||||||||||||||
On August 8, 2006, the Company entered into a 50/50 joint venture to renovate and convert an apartment building on Biscayne Bay in Miami Beach into a condominium hotel, Mondrian South Beach, which opened in December 2008. The Company operates Mondrian South Beach under a long-term management contract. | ||||||||||||||||
The Mondrian South Beach joint venture acquired the existing building and land for a gross purchase price of $110.0 million. An initial equity investment of $15.0 million from each of the 50/50 joint venture partners was funded at closing, and subsequently each member also contributed $8.0 million of additional equity. The Company and an affiliate of its joint venture partner provided additional mezzanine financing of approximately $22.5 million in total to the joint venture through a new 50/50 mezzanine financing joint venture to fund completion of the construction in 2008. Additionally, the Mondrian South Beach joint venture initially received nonrecourse mortgage loan financing of approximately $124.0 million at a rate of LIBOR plus 3.0%. A portion of this mortgage debt was paid down, prior to the amendments discussed below, with proceeds obtained from condominium sales. In April 2008, the Mondrian South Beach joint venture obtained a mezzanine loan from the mortgage lenders of $28.0 million bearing interest at LIBOR plus 6.0%. | ||||||||||||||||
In April 2010, the Mondrian South Beach ownership joint venture amended the nonrecourse mortgage financing and mezzanine loan agreements secured by Mondrian South Beach or related equity interests and extended the maturity date for up to seven years through one-year extension options until April 2017, subject to certain conditions. Among other things, the amendment allowed the joint venture to accrue all interest through April 2012, accrue a portion of the interest thereafter, extend the mezzanine loan to April 2027 if the mortgage loan is retired, and provide the ability to provide seller financing to qualified condominium buyers with up to 80% of the condominium purchase price. The Company and an affiliate of its joint venture partner each provided an additional $2.75 million to the joint venture through the mezzanine financing joint venture resulting in total mezzanine financing provided by the mezzanine financing joint venture of $28.0 million. The amendment also provides that this $28.0 million joint venture mezzanine financing invested in the property be, in effect, on par with the lender’s mezzanine debt after the repayment of the mortgage debt such that the mezzanine financing joint venture receives the first $5.5 million of net cash flow, the lender mezzanine financing receives the next $5.5 million, and the remaining proceeds are distributed equally between the joint venture mezzanine loan and the lender mezzanine loan. | ||||||||||||||||
In March 2014, the joint venture exercised its option to extend the outstanding mortgage and mezzanine debt until April 2015. As of September 30, 2014, the joint venture’s outstanding nonrecourse mortgage loan was $24.1 million and the outstanding mezzanine loan was $28.0 million. In addition, the outstanding mezzanine debt owed to affiliates of the joint venture partners was $28.0 million. | ||||||||||||||||
The joint venture is in the process of selling units as condominiums, subject to market conditions, and unit buyers will have the opportunity to place their units into the hotel’s rental program. As of September 30, 2014, 261 hotel residences had been sold, of which 140 are in the hotel rental pool and are included in the hotel room count, and 74 hotel residences remain to be sold. In addition to hotel management fees, the Company could also realize fees from the sale of condominium units, although there can be no assurances of any sales in the future. | ||||||||||||||||
The Mondrian South Beach joint venture was determined to be a variable interest entity as during the process of refinancing the venture’s mortgage in April 2010, its equity investment at risk was considered insufficient to permit the entity to finance its own activities. Management determined that the Company is not the primary beneficiary of this variable interest entity as the Company does not have a controlling financial interest in the entity. | ||||||||||||||||
Because the Company has written its investment value in the joint venture to zero, for financial reporting purposes, the Company believes its maximum exposure to losses as a result of its involvement in the Mondrian South Beach variable interest entity is limited to its outstanding management fees and related receivables and $14.0 million of advances in the form of mezzanine financing, excluding guarantees and other contractual commitments. | ||||||||||||||||
The Company is not committed to providing financial support to this variable interest entity, other than as contractually required, and all future funding is expected to be provided by the joint venture partners in accordance with their respective percentage interests in the form of capital contributions or loans, or by third parties. | ||||||||||||||||
Morgans Group and affiliates of its joint venture partner have provided certain guarantees and indemnifications to the Mondrian South Beach lenders. See note 7. | ||||||||||||||||
Mondrian SoHo | ||||||||||||||||
In June 2007, the Company entered into a joint venture with Cape Advisors Inc. to acquire and develop a Mondrian hotel in the SoHo neighborhood of New York City. The Company initially contributed $5.0 million for a 20% equity interest in the joint venture. Mondrian SoHo opened in February 2011 and has 263 guest rooms, a restaurant, bar and other facilities. Under the terms of the hotel management agreement executed between the Company and the joint venture in June 2007, the Company has a contract to manage the hotel for a 10-year term beginning on the date the hotel opened for business, which was in February 2011, with two 10-year extension options. | ||||||||||||||||
The joint venture obtained a loan of $195.2 million to acquire and develop the hotel, which matured in June 2010. On July 31, 2010, the mortgage loan secured by the hotel was amended to, among other things, provide for extensions of the maturity date to November 2011 with extension options through 2015, subject to certain conditions including a minimum debt service coverage test calculated, based on ratios of net operating income to debt service for specified periods ended September 30th of each year. The joint venture satisfied the extension conditions in 2011, but did not satisfy the conditions in November 2012. In January 2013, the lender initiated foreclosure proceedings and litigation is ongoing, although a court appointed referee issued a report in August 2014 setting the amount due on the loan ($250.5 million as of August 18, 2014, plus interest accruing at a daily rate of approximately $84,000, as of August 18, 2014) and determining the property should be sold as one parcel. On September 15, 2014, the lender filed a motion to confirm the referee’s report in the foreclosure action and for proposed judgment of foreclosure and sale. That motion is fully briefed and pending, but the court has not yet entered a judgment of foreclosure and sale, as discussed further in note 7, “—Litigations Regarding Mondrian SoHo.” As of September 30, 2014, the Mondrian SoHo joint venture’s outstanding mortgage debt secured by the hotel was $196.0 million. In addition, as of August 18, 2014, the court appointed referee calculated deferred interest through the date of default of $20.8 million and default interest of $33.4 million. | ||||||||||||||||
In December 2011, the Mondrian SoHo joint venture was determined to be a variable interest entity as a result of upcoming debt maturity and cash shortfalls, and because its equity was considered insufficient to permit the entity to finance its own activities. However, the Company determined that it was not the primary beneficiary and, therefore, consolidation of this joint venture is not required. The Company continues to account for its investment in Mondrian SoHo using the equity method of accounting. Because the Company has written its investment value in the joint venture to zero, for financial reporting purposes, the Company believes its maximum exposure to losses as a result of its involvement in the Mondrian SoHo variable interest entity is limited to its outstanding management fees and related receivables and advances in the form of priority loans, excluding guarantees and other contractual commitments. | ||||||||||||||||
Certain affiliates of the Company’s joint venture partner have provided certain guarantees and indemnifications to the Mondrian SoHo lenders for which Morgans Group has agreed to indemnify the joint venture partner and its affiliates in certain circumstances. See note 7. | ||||||||||||||||
Food and Beverage Venture at Mondrian South Beach | ||||||||||||||||
In June 2011, the Company acquired its former joint venture partner’s ownership interest in the food and beverage venture at Mondrian South Beach. As a result, the Company’s ownership interest in this food and beverage venture effectively increased to 75%, and the accounting for this investment was reevaluated in accordance with ASC 810-10. The Company concluded that this venture did not meet the requirements of a variable interest entity and accordingly, this investment in the joint venture is accounted for using the equity method, as the Company does not believe it exercises control over significant asset decisions such as buying, selling or financing. | ||||||||||||||||
The Company accounted for this investment under the equity method of accounting through December 31, 2013, until its recording of losses was suspended. As of September 30, 2014, the Company’s investment in this food and beverage venture was zero. Because the Company has written its investment value in the joint venture to zero, for financial reporting purposes, the Company believes its maximum exposure to losses as a result of its involvement in the food and beverage venture at Mondrian South Beach is limited to any outstanding receivables, which was immaterial as of September 30, 2014. | ||||||||||||||||
Ames | ||||||||||||||||
On June 17, 2008, the Company, Normandy Real Estate Partners, and Ames Hotel Partners entered into a joint venture agreement as part of the development of the Ames hotel in Boston. Ames opened on November 19, 2009. | ||||||||||||||||
The Company contributed a total of approximately $12.1 million in equity for an approximately 31% interest in the ownership joint venture. The joint venture obtained a loan for $46.5 million secured by the hotel, which matured on October 9, 2012 and the mortgage lender served the joint venture with a notice of event of default stating that the nonrecourse mortgage refinancing on the property was not repaid when it matured. | ||||||||||||||||
On April 26, 2013, the joint venture closed on a new loan agreement with the mortgage lenders that provided for a reduction of the mortgage debt and an extension of maturity in return for a cash paydown. The Company did not contribute to the cash paydown and instead entered into an agreement with its joint venture partner, as discussed further in note 7. | ||||||||||||||||
In May 2013, the hotel owner exercised its right to terminate the Company’s management agreement effective July 17, 2013, and on July 17, 2013 the management agreement terminated. The Company received cash of $1.8 million, of which $0.9 million was recorded in management fee-related parties and other income on the consolidated statements of comprehensive loss during each of the second and third quarters of the year ended December 31, 2013. | ||||||||||||||||
Prior to the Company assigning its equity interests in the joint venture to its joint venture partner, net income or loss and cash distributions or contributions were allocated to the partners in accordance with their respective ownership interests. The Company accounted for this investment under the equity method of accounting. | ||||||||||||||||
Shore Club | ||||||||||||||||
On December 30, 2013, Shore Club was sold to HFZ Capital Group. Phillips International, an affiliate of Shore Club’s former owner, retains an ownership stake. The new owner has publicly stated that it may convert a substantial part of the hotel to condos, and the Company could be replaced as hotel manager. To date, the Company has received no notice of termination of its management agreement, and intends to continue to operate the hotel pursuant to that agreement. However, no assurance can be provided that the Company will continue to do so in the future. As of September 30, 2014, the Company had only an immaterial contingent profit participation equity interest in Shore Club. | ||||||||||||||||
Mondrian Istanbul | ||||||||||||||||
In December 2011, the Company entered into a hotel management agreement for an approximately 122-room Mondrian-branded hotel to be located in the Old City area of Istanbul, Turkey. In December 2011 and January 2012, the Company contributed an aggregate of $10.3 million in the form of equity and key money and has a 20% ownership interest in the joint venture owning the hotel. The Company has no additional funding commitments in connection with this project. | ||||||||||||||||
Due to the Company’s joint venture partner’s failure to achieve certain agreed milestones in the development of the Mondrian Istanbul hotel, in early 2014, the Company exercised its put option under the joint venture agreement that requires the Company’s joint venture partner to buy back the Company’s equity interests in the Mondrian Istanbul joint venture. The Company’s rights under that joint venture agreement are secured by, among other things, a mortgage on the property. In February 2014, the Company issued a notice of default to its joint venture partner, as they failed to buy back the Company’s equity interests by the contractual deadline, and further notified its joint venture partner that the Company plans to begin foreclosure proceedings as a result of the event of default. The Company initiated foreclosure proceedings on March 11, 2014. The Company’s joint venture partner, and through such joint venture partner, the joint venture itself, have objected to the foreclosure proceeding, as a result of which, the foreclosure proceeding is currently stayed. Additionally, in June 2014, the joint venture purported to notify the Company that it had terminated the hotel management agreement. The Company has objected to such purported notices and intends to vigorously defend against any lawsuit that may result. In addition, the Company has initiated proceedings in an English court seeking payment of the put option amount against the individual shareholders behind the joint venture partner. The parties are also seeking various other judicial remedies in Turkey. |
Other_Liabilities
Other Liabilities | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Other Liabilities Disclosure [Abstract] | ' | |||||||
Other Liabilities | ' | |||||||
5. Other Liabilities | ||||||||
Other liabilities consist of the following (in thousands): | ||||||||
As of | As of | |||||||
September 30, | December 31, | |||||||
2014 | 2013 | |||||||
Designer fee claim | $ | 13,866 | $ | 13,866 | ||||
OPP LTIP Units Liability (note 8) | — | 25 | ||||||
$ | 13,866 | $ | 13,891 | |||||
Designer Fee Claim | ||||||||
As of September 30, 2014 and December 31, 2013, other liabilities consisted of a liability related to a designer fee claim. The Former Parent had an exclusive service agreement with a hotel designer, pursuant to which the designer has made various claims related to the agreement. Although the Company is not a party to the agreement, it may have certain contractual obligations or liabilities to the Former Parent in connection with the agreement. According to the agreement, the designer was owed a base fee for each designed hotel, plus 1% of gross revenues, as defined in the agreement, for a 10-year period from the opening of each hotel. In addition, the agreement also called for the designer to design a minimum number of projects for which the designer would be paid a minimum fee. A liability amount has been estimated and recorded in these consolidated financial statements before considering any defenses and/or counter-claims that may be available to the Company or the Former Parent in connection with any claim brought by the designer. The estimated costs of the design services were capitalized as a component of the applicable hotel in prior years and were amortized over the five-year estimated life of the related design elements. |
Debt_and_Capital_Lease_Obligat
Debt and Capital Lease Obligations | 9 Months Ended | |||||||||
Sep. 30, 2014 | ||||||||||
Debt Disclosure [Abstract] | ' | |||||||||
Debt and Capital Lease Obligations | ' | |||||||||
6. Debt and Capital Lease Obligations | ||||||||||
Debt and capital lease obligations consists of the following (in thousands): | ||||||||||
Description | As of | As of | Interest rate at | |||||||
September 30, | December 31, | September 30, | ||||||||
2014 | 2013 | 2014 | ||||||||
Hudson/Delano Mortgage (a) | $ | 450,000 | $ | — | 5.80% (LIBOR + 5.65%) | |||||
Notes secured by Hudson (a) | — | 180,000 | ||||||||
Clift debt (b) | 93,396 | 91,486 | 9.60% | |||||||
Liability to subsidiary trust (c) | 50,100 | 50,100 | 8.68% | |||||||
Convertible Notes (d) | 49,015 | 170,698 | 2.38% | |||||||
TLG Promissory Notes (e) | 19,096 | 18,807 | (f) | |||||||
Restaurant Lease Note (f) | 5,926 | 6,551 | (h) | |||||||
Capital lease obligations (g) | 6,105 | 6,109 | (g) | |||||||
Revolving credit facility (h) | — | 37,000 | ||||||||
Debt and capital lease obligation | $ | 673,638 | $ | 560,751 | ||||||
(a) Mortgage Agreements | ||||||||||
Hudson/Delano 2014 Mortgage Loan | ||||||||||
On February 6, 2014, subsidiaries of the Company entered into a new mortgage financing with Citigroup Global Markets Realty Corp. and Bank of America, N.A., as lenders, consisting of $300.0 million nonrecourse mortgage notes and $150.0 million mezzanine loans resulting in an aggregate principal amount of $450.0 million, secured by mortgages encumbering Delano South Beach and Hudson and pledges of equity interests in certain subsidiaries of the Company (collectively, the “Hudson/Delano 2014 Mortgage Loan”). | ||||||||||
The net proceeds from the Hudson/Delano 2014 Mortgage Loan were applied to (1) repay $180.0 million of outstanding mortgage debt under the prior mortgage loan secured by Hudson (the “Hudson 2012 Mortgage Loan”), (2) repay $37.0 million of indebtedness under the Company’s $100.0 million senior secured revolving credit facility secured by Delano South Beach (the “Delano Credit Facility”), (3) provide cash collateral for reimbursement obligations with respect to a $10.0 million letter of credit under the Delano Credit Facility which was returned to the Company in June 2014, as discussed in note 7, and (4) fund reserves required under the Hudson/Delano 2014 Mortgage Loan, with the remainder available for general corporate purposes and working capital, and the repayment of other indebtedness, subject to certain minimum unencumbered asset requirements. | ||||||||||
The Hudson/Delano 2014 Mortgage Loan bears interest at a reserve adjusted blended rate of 30-day LIBOR plus 565 basis points. The Company maintains interest rate caps for the principal amount of the Hudson/Delano 2014 Mortgage Loan that caps the LIBOR rate on the debt under the Hudson/Delano 2014 Mortgage Loan at approximately 1.75% through the initial maturity date. | ||||||||||
The Hudson/Delano 2014 Mortgage Loan matures on February 9, 2016. The Company has three, one-year extension options that will permit the Company to extend the maturity date of the Hudson/Delano 2014 Mortgage Loan to February 9, 2019, if certain conditions are satisfied at the respective extension dates, including delivery by the borrowers of a business plan and budget for the extension term reasonably satisfactory to the lenders and achievement by the Company of a specified debt yield. The second and third extensions would also require the payment of an extension fee in an amount equal to 0.25% of the then outstanding principal amount under the Hudson/Delano 2014 Mortgage Loan. A minimum unencumbered assets requirement may also be required if certain other indebtedness (as same may be amended, supplemented, modified, refinanced or replaced) becomes due during the extension term. The Company may prepay the Hudson/Delano 2014 Mortgage Loan in an amount necessary to achieve the specified debt yield. | ||||||||||
The Hudson/Delano 2014 Mortgage Loan may be prepaid at any time, in whole or in part, subject to payment of a prepayment premium for any prepayment prior to August 9, 2015. There is no prepayment premium after August 9, 2015. | ||||||||||
The Hudson/Delano 2014 Mortgage Loan is assumable under certain conditions, and provides that either one of the encumbered hotels may be sold, subject to prepayment of the Hudson/Delano 2014 Mortgage Loan at a specified release price and satisfaction of certain other conditions. | ||||||||||
The Hudson/Delano 2014 Mortgage Loan contains restrictions on the ability of the borrowers to incur additional debt or liens on their assets and on the transfer of direct or indirect interests in Hudson or Delano South Beach and the owners of Hudson and Delano South Beach and other affirmative and negative covenants and events of default customary for multiple asset commercial mortgage-backed securities loans. The Hudson/Delano 2014 Mortgage Loan is nonrecourse to the Company’s subsidiaries that are the borrowers under the loan, except pursuant to certain carveouts detailed therein. In addition, the Company has provided a customary environmental indemnity and nonrecourse carveout guaranty under which it would have liability with respect to the Hudson/Delano 2014 Mortgage Loan if certain events occur with respect to the borrowers, including voluntary bankruptcy filings, collusive involuntary bankruptcy filings, changes to the Hudson capital lease without prior written consent of the lender, violations of the restrictions on transfers, incurrence of additional debt, or encumbrances of the property of the borrowers. The nonrecourse carveout guaranty requires the Company to maintain minimum unencumbered assets (as defined in the nonrecourse carveout guaranty) until the Company’s outstanding Convertible Notes and TLG Promissory Notes are repaid, extended, refinanced or replaced beyond the term of the Hudson/Delano 2014 Mortgage Loan. The Convertible Notes were repaid upon maturity in October 2014. Further, the nonrecourse carveout guaranty prohibits the payment of dividends on or repurchase of the Company’s common stock. As of September 30, 2014, the Company was in compliance with these covenants. | ||||||||||
On April 8, 2014, the Hudson/Delano 2014 Mortgage Loan was amended to reallocate the principal amount and interest rate spread of the $300.0 million nonrecourse mortgage notes. This technical amendment had no impact on the total outstanding principal amount of the nonrecourse mortgage notes or the blended interest rate of the Hudson/Delano 2014 Mortgage Loan. | ||||||||||
Hudson Mortgage and Mezzanine Loan | ||||||||||
On November 14, 2012, certain of the Company’s subsidiaries entered into the Hudson 2012 Mortgage Loan, a mortgage financing with UBS Real Estate Securities Inc., as lender, consisting of a $180.0 million nonrecourse mortgage loan, secured by Hudson, which was fully-funded at closing. | ||||||||||
The Hudson 2012 Mortgage Loan bore interest at a reserve adjusted blended rate of 30-day LIBOR (with a minimum of 0.50%) plus 840 basis points. The Company maintained an interest rate cap for the amount of the Hudson 2012 Mortgage Loan that capped the 30-day LIBOR rate on the debt under the Hudson 2012 Mortgage Loan at approximately 2.5% through the maturity date. | ||||||||||
In connection with the Hudson/Delano 2014 Mortgage Loan, the Hudson 2012 Mortgage Loan was terminated after repayment of the outstanding debt thereunder in February 2014. | ||||||||||
(b) Clift Debt | ||||||||||
In October 2004, Clift Holdings LLC (“Clift Holdings”), a subsidiary of the Company, sold the Clift hotel to an unrelated party for $71.0 million and then leased it back for a 99-year lease term. Under this lease, Clift Holdings is required to fund operating shortfalls including the lease payments and to fund all capital expenditures. This transaction did not qualify as a sale due to the Company’s continued involvement and therefore is treated as a financing. | ||||||||||
The lease agreement provides for base annual rent of approximately $6.0 million per year until October 2014. Thereafter, base rent increases at five-year intervals by a formula tied to increases in the Consumer Price Index, with a maximum increase of 40% and a minimum increase of 20% at October 2014, and a maximum increase of 20% and a minimum increase of 10% at each five-year rent increase date thereafter. As a result of the first such increase, effective October 14, 2014, the annual rent increased to $7.6 million. The lease is nonrecourse to the Company. | ||||||||||
Morgans Group also entered into an agreement, dated September 17, 2010, whereby Morgans Group agreed to guarantee losses of up to $6.0 million suffered by the lessors in the event of certain “bad boy” type acts. As of September 30, 2014, there had been no triggering event that would require the Company to recognize a liability related to this guarantee. | ||||||||||
(c) Liability to Subsidiary Trust Issuing Preferred Securities | ||||||||||
On August 4, 2006, a newly established trust formed by the Company, MHG Capital Trust I (the “Trust”), issued $50.0 million in trust preferred securities in a private placement. The Company owns all of the $0.1 million of outstanding common stock of the Trust. The Trust used the proceeds of these transactions to purchase $50.1 million of junior subordinated notes issued by the Company’s operating company and guaranteed by the Company (the “Trust Notes”) which mature on October 30, 2036. The sole assets of the Trust consist of the Trust Notes. The terms of the Trust Notes are substantially the same as preferred securities issued by the Trust. The Trust Notes and the preferred securities have a fixed interest rate of 8.68% until October 2016, after which the interest rate will float and reset quarterly at the three-month LIBOR rate plus 3.25% per annum. The Trust Notes are redeemable by the Trust, at the Company’s option, at par, and the Company has not redeemed any Trust Notes. To the extent the Company redeems the Trust Notes, the Trust is required to redeem a corresponding amount of preferred securities. | ||||||||||
The Company has identified that the Trust is a variable interest entity under ASC 810-10. Based on management’s analysis, the Company is not the primary beneficiary of the trust. Accordingly, the Trust is not consolidated into the Company’s financial statements. The Company accounts for the investment in the common stock of the Trust under the equity method of accounting. | ||||||||||
In the event the Company were to undertake a transaction that was deemed to constitute a transfer of its properties and assets substantially as an entirety within the meaning of the indenture, the Company may be required to repay the Trust Notes prior to their maturity or obtain the trustee’s consent in connection with such transfer. | ||||||||||
(d) Convertible Notes | ||||||||||
On October 17, 2007, the Company issued $172.5 million aggregate principal amount of 2.375% Senior Subordinated Convertible Notes in a private offering. Net proceeds from the offering were approximately $166.8 million. | ||||||||||
From April 21, 2010 to July 21, 2010, the Yucaipa Investors purchased $88.0 million of the Convertible Notes from third parties. On February 28, 2014, the Company entered into a Note Repurchase Agreement with the Yucaipa Investors, pursuant to which it repurchased the Convertible Notes owned by them for an amount equal to their principal balance plus accrued interest. The Company used cash on hand, including proceeds of the Hudson/Delano 2014 Mortgage Loan, for this repurchase. Additionally, during the third quarter of 2014, the Company used cash on hand to repurchase an aggregate of $35.4 million of outstanding Convertible Notes at an aggregate discount of approximately $0.1 million plus accrued interest. The repurchased Convertible Notes were retired upon repurchase. | ||||||||||
On October 15, 2014, the Convertible Notes matured and the Company repaid the outstanding principal amount of $49.1 million with cash on hand. The Convertible Notes were retired upon repayment. | ||||||||||
The Company followed ASC 470-20, Debt with Conversion and Other Options (“ASC 470-20”), which clarifies the accounting for convertible notes payable. ASC 470-20 requires the proceeds from the issuance of convertible notes to be allocated between a debt component and an equity component. The debt component is measured based on the fair value of similar debt without an equity conversion feature, and the equity component is determined as the residual of the fair value of the debt deducted from the original proceeds received. The resulting discount on the debt component is amortized over the period the debt is expected to be outstanding as additional interest expense. The equity component, recorded as additional paid-in capital, was determined to be $9.0 million, which represented the difference between the proceeds from issuance of the Convertible Notes and the fair value of the liability, net of deferred taxes of $6.4 million as of the date of issuance of the Convertible Notes. | ||||||||||
In connection with the issuance of the Convertible Notes, the Company entered into convertible note hedge transactions (the “Convertible Notes Call Options”) with respect to the Company’s common stock with Merrill Lynch Financial Markets, Inc. and Citibank, N.A. These call options were exercisable solely in connection with any conversion of the Convertible Notes and pursuant to which the Company would receive shares of the Company’s common stock from Merrill Lynch Financial Markets, Inc. and Citibank, N.A equal to the number of shares issuable to the holders of the Convertible Notes upon conversion. Also in connection with the sale of the Convertible Notes, the Company also entered into separate warrant transactions with Merrill Lynch Financial Markets, Inc. and Citibank, N.A., whereby the Company issued warrants (the “Convertible Notes Warrants”) to purchase 6,415,327 shares of common stock, subject to customary anti-dilution adjustments, at an exercise price of approximately $40.00 per share of common stock. These Convertible Notes Call Options and Convertible Notes Warrants expired when the Convertible Notes were repaid in October 2014. The Company recorded the purchase of the Convertible Note Call Options, net of the related tax benefit of approximately $20.3 million, as a reduction of additional paid-in capital and the proceeds from the Convertible Notes Warrants as an addition to additional paid-in capital in accordance with ASC 815-30, Derivatives and Hedging, Cash Flow Hedges. | ||||||||||
(e) TLG Promissory Notes | ||||||||||
On November 30, 2011, pursuant to purchase agreements entered into on November 17, 2011, certain of the Company’s subsidiaries completed the acquisition of 90% of the equity interests in TLG for a purchase price of $28.5 million in cash and up to $18.0 million of TLG Promissory Notes, which are convertible into shares of the Company’s common stock at $9.50 per share. The TLG Promissory Notes were allocated $16.0 million to Mr. Sasson and $2.0 million to Mr. Masi. | ||||||||||
The payment of $18.0 million was based on TLG achieving EBITDA of at least $18.0 million from Non-Morgans EBITDA during the period starting on January 1, 2012 and ending on March 31, 2014, with ratable reduction of the payment if less than $18.0 million of EBITDA was earned. The fair value of the TLG Promissory Notes was estimated each quarter utilizing a Monte Carlo simulation to estimate the probability of the performance conditions being satisfied. The EBITDA targets had been achieved at September 30, 2014 and the fair value of the TLG Promissory Notes of $18.0 million plus accrued interest of $1.1 million is reflected in the Company’s September 30, 2014 consolidated financial statements. | ||||||||||
The TLG Promissory Notes mature on November 30, 2015 and may be voluntarily prepaid, in full or in part, at any time. At either Messrs. Sasson’s or Masi’s options, the TLG Promissory Notes are payable in cash or in common stock of the Company valued at $9.50 per share. Each of the TLG Promissory Notes earns interest at an annual rate of 8%, and if the notes are not paid or converted on or before November 30, 2014, the interest rate increases to 18%. The TLG Promissory Notes provide that 75% of the accrued interest is payable quarterly in cash and the remaining 25% accrues and is included in the principal balance which is payable at maturity. Morgans Group has guaranteed payment of the TLG Promissory Notes and interest. | ||||||||||
As discussed further in note 7, on August 5, 2013, Messrs. Sasson and Masi filed a lawsuit in the Supreme Court of the State of New York against TLG Acquisition and Morgans Group alleging, among other things, breach of contract and an event of default under the TLG Promissory Notes as a result of the Company’s failure to repay the TLG Promissory Notes following an alleged “Change of Control” of the Company in connection with the election of directors at the Company’s 2013 Annual Meeting. On September 26, 2013, the Company filed a motion to dismiss the complaint in its entirety. On February 6, 2014, the court granted the Company’s motion to dismiss. On March 7, 2014, Messrs. Sasson and Masi filed a Notice of Appeal from this decision with the Appellate Division, First Department, and on July 8, 2014, they filed their initial brief in support of that appeal. Briefing of that appeal is ongoing, and the Company’s opposition brief was due August 29, 2014. The oral argument on the motion occurred on October 29, 2014 and the Company is awaiting the court’s ruling. | ||||||||||
(f) Restaurant Lease Note | ||||||||||
As discussed in note 2, in August 2012, the Company acquired the leasehold interests in three food and beverage venues at Mandalay Bay from an existing tenant for $15.0 million in cash at closing and the issuance of a principal-only $10.6 million Restaurant Lease Note to be paid over seven years. The Restaurant Lease Note does not bear interest except in the event of default, as defined in the agreement. In accordance with ASC 470, Debt, the Company imputed interest on the Restaurant Lease Note, which was recorded at its fair value of $7.5 million as of the date of issuance. At September 30, 2014, the balance outstanding recorded on the Restaurant Lease Note was $5.9 million. | ||||||||||
(g) Capital Lease Obligations | ||||||||||
The Company has leased two condominium units at Hudson from unrelated third-parties, which are reflected as capital leases. One of the leases requires the Company to make annual payments, currently $649,728 (subject to increases due to increases in the Consumer Price Index), through November 2096. This lease also allows the Company to purchase, at its option, the unit at fair market value after November 2015. The second lease requires the Company to make annual payments, currently $365,490 (subject to increases due to increases in the Consumer Price Index), through December 2098. | ||||||||||
The Company has allocated both lease payments between the land and building based on their estimated fair values. The portion of the payments allocated to the building has been capitalized at the present value of the future minimum lease payments. The portion of the payments allocable to the land is treated as operating lease payments. The imputed interest rate on both of these leases is 8%, which is based on the Company’s incremental borrowing rate at the time the lease agreement was executed. The capital lease obligations related to the units amounted to approximately $6.1 million as of September 30, 2014 and December 31, 2013, respectively. Substantially all of the principal payments on the capital lease obligations are due at the end of the lease agreements. | ||||||||||
(h) Delano Credit Facility | ||||||||||
On July 28, 2011, the Company and certain of its subsidiaries (collectively, the “Borrowers”), entered into a secured credit agreement with Deutsche Bank Securities Inc. as sole lead arranger, Deutsche Bank Trust Company Americas, as agent, and the lenders party thereto. | ||||||||||
The credit agreement provided commitments for the Delano Credit Facility, a $100.0 million revolving credit facility and included a $15.0 million letter of credit sub-facility. The interest rate applicable to loans outstanding on the Delano Credit Facility was a floating rate of interest per annum, at the Borrowers’ election, of either LIBOR (subject to a LIBOR floor of 1.00%) plus 4.00%, or a base rate, as defined in the agreement, plus 3.00%. In addition, a commitment fee of 0.50% applied to the unused portion of the commitments under the Delano Credit Facility. | ||||||||||
In connection with the closing of the Hudson/Delano 2014 Mortgage Loan, described more fully above, the Delano Credit Facility was terminated after repayment of the outstanding debt thereunder in February 2014. |
Commitments_and_Contingencies
Commitments and Contingencies | 9 Months Ended | |||||||||
Sep. 30, 2014 | ||||||||||
Commitments And Contingencies Disclosure [Abstract] | ' | |||||||||
Commitments and Contingencies | ' | |||||||||
7. Commitments and Contingencies | ||||||||||
Hotel Development Related Commitments | ||||||||||
In order to obtain long-term management, franchise and license contracts, the Company has committed to contribute capital in various forms on hotel development projects. These include equity investments, key money, and cash flow guarantees to hotel owners. The cash flow guarantees generally have a stated maximum amount of funding and a defined term. The terms of the cash flow guarantees to hotel owners generally require the Company to fund if the hotels do not attain specified levels of operating profit. Oftentimes, cash flow guarantees to hotel owners may be recoverable as loans repayable to the Company out of future hotel cash flows and/or proceeds from the sale of hotels. | ||||||||||
The following table details, as of September 30, 2014 and December 31, 2013, the Company’s key money, equity investment and debt financing commitments for hotels under development as well as potential funding obligations under cash flow guarantees at operating hotels and hotels under development at the maximum amount under the applicable contracts, but excluding contracts where the maximum amount cannot be determined (in thousands): | ||||||||||
As of | As of | |||||||||
September 30, | December 31, | |||||||||
2014 (1) | 2013 (1) | |||||||||
Key money, equity investment and debt financing commitments (2) | $ | 15,514 | $ | 22,499 | ||||||
Key money commitments related to terminated project (3) | — | 10,000 | ||||||||
Cash flow guarantees | 5,000 | 13,000 | ||||||||
Cash flow guarantees in dispute (4) | 8,000 | 8,000 | ||||||||
Total maximum future funding commitments | $ | 28,514 | $ | 53,499 | ||||||
Amounts due within one year (5) | $ | 15,514 | $ | 25,499 | ||||||
-1 | The currency translation is based on an exchange rate of the applicable local currency to U.S. dollar using the exchange rate as of the end of the applicable reporting period. | |||||||||
-2 | As of September 30, 2014 and December 31, 2013, these commitments consist of key money commitments. The Company had no equity or debt financing commitments at September 30, 2014 and December 31, 2013. | |||||||||
-3 | As of December 31, 2013, amount reflects the funding of $10.0 million in key money for Mondrian at Baha Mar, which the Company is not obligated to fund due to the termination of the related management agreement in June 2014, discussed further below. | |||||||||
-4 | Reflects an $8.0 million performance cash flow guarantee related to Delano Marrakech, which the Company believes it is not obligated to fund due to the owner’s defaults under the management agreement terms. The Company has terminated its management agreement effective November 12, 2013, discussed further below. | |||||||||
-5 | As of September 30, 2014, amount primarily consists of £9.4 million (or approximately $15.3 million at the exchange rate as of September 30, 2014) in key money for Mondrian London. As of December 31, 2013, amount represents key money for Mondrian London and Mondrian at Baha Mar. The Company is not obligated to fund the key money for Mondrian Baha Mar due to the termination of the related management agreement in June 2014, discussed further below. | |||||||||
On September 30, 2014, Mondrian London at Sea Containers opened. As a result, the Company funded its £9.4 million key money obligation (or approximately $15.2 million at the exchange rate as of the payment date) in October 2014 with cash on hand. The Company also paid approximately $3.0 million of value added tax which the Company expects to recover from the taxing authority. | ||||||||||
In September 2014, the Company and the hotel owners mutually agreed to terminate the Delano Moscow management agreement. As a result, the Company was relieved of its $10.0 million key money obligation, of which $3.0 million had already been funded and was refunded back to the Company in September 2014. The Company was also relieved of its $8.0 million potential cash flow guarantee. All of these amounts are no longer included in the September 30, 2014 commitment table above. | ||||||||||
In June 2014, the Mondrian at Baha Mar management agreement was terminated due to the failure of hotel owner to obtain a non-disturbance agreement from its lender as required by the management agreement, among other things. | ||||||||||
In September 2012, the Company opened Delano Marrakech, a 71-room hotel in Marrakech, Morocco. The management agreement included certain cash flow guarantees by the Company which stipulate certain minimum levels of operating performance and could result in potential future funding obligations related to Delano Marrakech, which are in dispute and disclosed in the hotel commitments and guarantees table above. As discussed further below, the Company and the hotel owner are in litigation surrounding the termination of the hotel management agreement, performance-based cash flow guarantee and related matters. Both parties are seeking arbitration of the dispute, which is expected to occur in March 2015. Mediation is currently scheduled for mid-December 2014. | ||||||||||
In January 2014, the Company signed a franchise agreement for 10 Karakoy, a Morgans Original branded hotel in Istanbul, Turkey. The hotel, which is currently under development, is being converted from office and retail space, is expected to have 71 rooms and open in November 2014. The Company has a $0.3 million key money obligation, which is included in the table above and will be funded upon the hotel opening. | ||||||||||
The Company has signed management, license or franchise agreements for new hotels which are in the development stage. As of September 30, 2014, these included the following: | ||||||||||
Expected Room | Anticipated | Initial | ||||||||
Count | Opening | Term | ||||||||
Hotels Currently Under Construction or Renovation: | ||||||||||
10 Karakoy, a Morgans Original, Istanbul (1) | 71 | 2014 | 15 years | |||||||
Mondrian Doha | 270 | 2015 | 30 years | |||||||
Other Signed Agreements: | ||||||||||
Mondrian Istanbul | 122 | 20 years | ||||||||
Delano Aegean Sea | 150 | 20 years | ||||||||
Delano Cartagena | 211 | 20 years | ||||||||
-1 | Hotel is subject to a license or franchise agreement. | |||||||||
There can be no assurances that any or all of the Company’s projects listed above will be developed as planned. If adequate project financing is not obtained, these projects may need to be limited in scope, deferred or cancelled altogether, and to the extent the Company has previously funded key money, an equity investment or debt financing on a cancelled project, the Company may be unable to recover the amounts funded. | ||||||||||
For example, due to the Company’s joint venture partner’s failure to achieve certain agreed milestones in the development of the Mondrian Istanbul hotel, in early 2014, the Company exercised its put option under the joint venture agreement and initiated foreclosure proceedings, as discussed further in note 4 and Part II, “Item 1. Legal Proceedings.” | ||||||||||
Other Guarantees to Hotel Owners | ||||||||||
As discussed above, the Company has provided certain cash flow guarantees to hotel owners in order to secure management contracts. | ||||||||||
The Company’s hotel management agreements for Royalton and Morgans contain cash flow guarantee performance tests that stipulate certain minimum levels of operating performance. These performance test provisions give the Company the option to fund a shortfall in operating performance limited to the Company’s earned base fees. If the Company chooses not to fund the shortfall, the hotel owner has the option to terminate the management agreement. As of September 30, 2014, approximately $0.7 million was accrued as a reduction to management fees related to these performance test provisions. The Company’s maximum potential amount of future fundings related to the Royalton and Morgans performance guarantee cannot be determined as of September 30, 2014, but under the hotel management agreements is limited to the Company’s base fees earned. | ||||||||||
Operating Joint Venture Hotels Commitments and Guarantees | ||||||||||
The following details obligations the Company has or may have related to its operating joint venture hotels as of September 30, 2014. | ||||||||||
Mondrian South Beach Mortgage and Mezzanine Agreements. Morgans Group and affiliates of its joint venture partner have agreed to provide standard nonrecourse carve-out guaranties and provide certain limited indemnifications for the Mondrian South Beach mortgage and mezzanine loans. In the event of a default, the lenders’ recourse is generally limited to the mortgaged property or related equity interests, subject to standard nonrecourse carve-out guaranties for “bad boy” type acts. Morgans Group and affiliates of its joint venture partner also agreed to guarantee the joint venture’s obligation to reimburse certain expenses incurred by the lenders and indemnify the lenders in the event such lenders incur liability in connection with certain third-party actions. Morgans Group and affiliates of its joint venture partner have also guaranteed the joint venture’s liability for the unpaid principal amount of any seller financing note provided for condominium sales if such financing or related mortgage lien is found unenforceable, provided they shall not have any liability if the seller financed unit becomes subject to the lien of the lender’s mortgage or title to the seller financed unit is otherwise transferred to the lender or if such seller financing note is repurchased by Morgans Group and/or affiliates of its joint venture at the full amount of unpaid principal balance of such seller financing note. In addition, although construction is complete and Mondrian South Beach opened on December 1, 2008, Morgans Group and affiliates of its joint venture partner may have continuing obligations under construction completion guaranties until all outstanding payables due to construction vendors are paid. As of September 30, 2014, there were remaining payables outstanding to vendors of approximately $0.3 million. Pursuant to a letter agreement with the lenders for the Mondrian South Beach loan, the joint venture agreed that these payables, many of which are currently contested or under dispute, will not be paid from operating funds but only from tax abatements and settlements of certain lawsuits. In the event funds from tax abatements and settlements of lawsuits are insufficient to repay these amounts in a timely manner, the Company and its joint venture partner are required to fund the shortfall amounts. | ||||||||||
The Company and affiliates of its joint venture partner also have each agreed to purchase approximately $14.0 million of condominium units under certain conditions, including an event of default. In the event of a default under the lender’s mortgage or mezzanine loan, the joint venture partners are each obligated to purchase selected condominium units, at agreed-upon sales prices, having aggregate sales prices equal to 1/2 of the lesser of $28.0 million, which is the face amount outstanding on the lender’s mezzanine loan, or the then outstanding principal balance of the lender’s mezzanine loan. The joint venture is not currently in an event of default under the mortgage or mezzanine loan. As of September 30, 2014, there had been no triggering event that would require the Company to recognize a liability related to the construction completion or the condominium purchase guarantees. | ||||||||||
Mondrian SoHo. Certain affiliates of the Company’s joint venture partner have agreed to provide a standard nonrecourse carve-out guaranty for “bad boy” type acts and a completion guaranty to the lenders for the Mondrian SoHo loan, for which Morgans Group has agreed to indemnify the joint venture partner and its affiliates up to 20% of such entities’ guaranty obligations, provided that each party is fully responsible for any losses incurred as a result of its own gross negligence or willful misconduct. As of September 30, 2014, there had been no triggering event that would require the Company to recognize a liability related to this indemnity. | ||||||||||
Ames. On April 26, 2013, the joint venture closed on a new loan agreement with the mortgage lenders that provided for a reduction of the mortgage debt and an extension of maturity in return for a cash paydown. The Company did not contribute to the cash paydown and instead entered into an agreement with its joint venture partner pursuant to which, among other things, (1) the Company assigned its equity interests in the joint venture to its joint venture partner, (2) the Company agreed to give its joint venture partner the right to terminate its management agreement upon 60 days’ prior notice in return for an aggregate payment of $1.8 million, and (3) a creditworthy affiliate of the Company’s joint venture partner has assumed all or a portion of the Company’s potential liability with respect to historic tax credit guaranties, with the Company’s liability for any tax credit guaranties capped, in any event, at $3.0 million in the aggregate. The potential liability for historic tax credit guaranties relates to approximately $16.9 million of federal and state historic rehabilitation tax credits that Ames qualified for at the time of its development. As of September 30, 2014, there had been no triggering event that would require the Company to accrue any potential liability related to the historic tax credit guarantee. In May 2013, the hotel owner exercised its right to terminate the Company’s management agreement and it was terminated on July 17, 2013. The termination fee totaling $1.8 million was recorded by the Company in the second and third quarters of 2013. | ||||||||||
Guaranteed Loans and Commitments | ||||||||||
The Company has made guarantees to lenders and lessors of its owned and leased hotels, namely related to the Hudson/Delano 2014 Mortgage Loan and Clift lease payments, as discussed further in note 6. | ||||||||||
Litigations Regarding Mondrian SoHo | ||||||||||
On January 16, 2013, German American Capital Corporation (“GACC” or the “lender”), the lender for the mortgage loans on Mondrian SoHo, filed a complaint in the Supreme Court of the State of New York, County of New York against Sochin Downtown Realty, LLC, the joint venture that owns Mondrian SoHo (“Sochin JV”), Morgans Management, the manager for the hotel, Morgans Group, Happy Bar LLC and MGMT LLC, seeking foreclosure including, among other things, the sale of the mortgaged property free and clear of the management agreement, entered into between Sochin JV and Morgans Management on June 27, 2007, as amended on July 30, 2010. According to the complaint, Sochin JV defaulted by failing to repay the approximately $217.0 million outstanding on the loans when they became due on November 15, 2012. Cape Advisors Inc. indirectly owns 80% of the equity interest in Sochin JV and Morgans Group indirectly owns the remaining 20% equity interest. | ||||||||||
On March 11, 2013, the Company moved to dismiss the lender’s complaint on the grounds that, among other things, the Company’s management agreement is not subject to foreclosure. On April 2, 2013, the lender opposed the Company’s motion to dismiss and cross-moved for summary judgment. On August 12, 2013, the court heard oral argument on both motions, as well as a third motion brought by the Company to strike an affirmation submitted by lender’s attorney. On January 27, 2014, the court granted Morgans Management’s motion to dismiss on the ground that Morgans Management was not a proper party to the foreclosure action and that a management contract does not constitute an interest in real property subject to foreclosure, and denied lender’s motion for summary judgment as moot. On March 20, 2014, the lender moved for summary judgment against the remaining defendants, seeking foreclosure on four mortgages secured by Mondrian SoHo. By order dated May 27, 2014, the trial court granted the motion for summary judgment to a limited extent, ordering the appointment of a referee to compute the amount but stating that a motion for summary judgment of foreclosure and sale is premature. By decision entered on July 28, 2014, the court referred the matter to a Referee to ascertain and compute the amount due to the lender for principal, interest, and other disbursements and to determine whether the property should be sold in one parcel. On August 6, 2014, the Referee set a hearing on the issues for August 18, 2014, and subsequently issued her report setting the amount due on the loan ($250.5 million, plus interest accruing at a daily rate of approximately $84,000, as of August 18, 2014) and determining the property should be sold as one parcel. On September 15, 2014, the lender filed a motion to confirm the Referee’s report and for judgment of foreclosure and sale, along with the Referee’s Report of Amount Due attached as an exhibit, and a proposed judgment of foreclosure and sale. That motion is fully briefed and pending, but the court has not yet entered a judgment of foreclosure and sale. | ||||||||||
On February 25, 2013, the Sochin JV filed a complaint in the Delaware Court of Chancery against Morgans Management and Morgans Group, seeking, among other things, a declaration that Sochin JV had terminated the management agreement for the hotel. In addition, the Company, through its equity affiliate, filed a separate action against Sochin JV and its parent in the Delaware Court of Chancery for, among other things, breaching fiduciary duties and their joint venture agreement for failing to obtain consent prior to the termination. That action was subsequently consolidated with the joint venture’s termination action. On April 30, 2013, Morgans Management filed a lawsuit against Sochin JV and the majority member of Sochin JV’s parent and its affiliate in New York Supreme Court for damages based on the wrongful attempted termination of the management agreement, defamation, and breach of fiduciary and other obligations under the parties’ joint venture agreement. On September 20, 2013, the Delaware Court of Chancery ruled that Sochin JV properly terminated the hotel management agreement on agency principles, that Morgans Management must vacate the hotel forthwith or on whatever other timetable the hotel owner chooses, and that certain claims by the Company’s equity affiliate are dismissed but not its breach of fiduciary duty claim. | ||||||||||
On May 9, 2014, both of the above-referenced actions in Delaware and the above-reference action in New York were dismissed with prejudice by agreement among the parties. Under the terms of the settlement, if the joint venture does not seek to remove the Company as manager of Mondrian SoHo prior to December 31, 2020, then the Company will be deemed to have released all claims against the joint venture under the Management Agreement. Under the terms of the settlement, the joint venture may demand that Morgans vacate Mondrian SoHo on 90 days’ prior notice; in the event the joint venture provides notice of its intention to remove the Company as manager of Mondrian SoHo, all of the Company’s claims against the joint venture (including for breach of the hotel management agreement) would be revived. The joint venture’s rights under the settlement are not assignable without the Company’s written consent. | ||||||||||
On October 24, 2014, the Company filed suit in the Supreme Court of the State of New York seeking a declaration that the mortgage lenders to the Mondrian SoHo debt cannot remove Morgans Management as hotel manager following the conclusion of the foreclosure proceedings involving the building's ownership and its possible sale. The action seeks to protect and enforce the Company's long-term hotel management contract for Mondrian SoHo, regardless of the outcome of the current foreclosure proceedings. The Company also seeks damages against the lenders and purported buyer of the property should Morgans Management be terminated as manager of the hotel. The lawsuit does not affect the foreclosure proceedings, and Morgans does not oppose the lenders’ efforts to foreclose on Mondrian SoHo. | ||||||||||
Litigation Regarding Delano Marrakech | ||||||||||
In June 2013, the Company served the owner of Delano Marrakech with a notice of default for, among other things, failure to pay fees and reimbursable expenses and to operate the hotel in accordance with the standards under the management agreement. In September 2013, the Company served notice of termination of its management agreement for Delano Marrakech following the failure by the owner of Delano Marrakech to remedy numerous breaches of the agreement. As a result, the Company discontinued all affiliation with the hotel, including removal of the Delano name, and terminated management of the property, effective November 12, 2013. Pursuant to the management agreement, in the event of an owner default, the Company has no further obligations under the performance-based cash flow guarantee. In addition, as a result of the breaches by the hotel owner, the Company has asserted a claim for losses and damages against the owner that is currently estimated at in excess of $30.0 million, including interest. The owner of the hotel is disputing the circumstances surrounding termination and therefore its liability for this amount. On April 17, 2014, the owner submitted a counterclaim against the Company under both the performance-based cash flow guarantee and for loss of profits. The total counterclaim made by the owner is in excess of $119.0 million, excluding interest. The Company considers the counterclaim made by the owner to be entirely without merit and intends to vigorously defend itself. Both parties are seeking arbitration of the dispute, which is expected to occur in March 2015. Mediation is currently scheduled for mid-December 2014. | ||||||||||
Litigation Regarding TLG Promissory Notes | ||||||||||
On August 5, 2013, Messrs. Andrew Sasson and Andy Masi filed a lawsuit in the Supreme Court of the State of New York against TLG Acquisition LLC and Morgans Group LLC relating to the $18.0 million TLG Promissory Notes. See note 1 and note 6 regarding the background of the TLG Promissory Notes. The complaint alleges, among other things, a breach of contract and an event of default under the TLG Promissory Notes as a result of the Company’s failure to repay the TLG Promissory Notes following an alleged “Change of Control” that purportedly occurred upon the election of the Company’s current Board of Directors on June 14, 2013. The complaint sought payment of Mr. Sasson’s $16.0 million TLG Promissory Note and Mr. Masi’s $2.0 million TLG Promissory Note, plus interest compounded to principal, as well as default interest, and reasonable costs and expenses incurred in the lawsuit. On September 26, 2013, the Company filed a motion to dismiss the complaint in its entirety. On February 6, 2014, the court granted the Company’s motion to dismiss. On March 7, 2014, Messrs. Sasson and Masi filed a Notice of Appeal from this decision with the Appellate Division, First Department, and on July 8, 2014, they filed their initial brief in support of that appeal. Briefing of that appeal is ongoing, and the Company’s opposition brief was due August 29, 2014. The oral argument on the motion occurred on October 29, 2014 and the Company is awaiting the court’s ruling. | ||||||||||
Litigation Regarding 2013 Deleveraging Transaction, Proxy Litigation Between Mr. Burkle and OTK and Certain of the Company’s Current Directors, and Litigation Regarding Yucaipa Board Observer Rights | ||||||||||
On May 5, 2014, the Company and affiliates of Yucaipa, among other litigants, executed and submitted to the Delaware Court of Chancery a Stipulation of Settlement (the “Settlement Stipulation”) which contemplates the partial settlement and dismissal of the Delaware Shareholder Derivative Action and the complete settlement and dismissal of the New York Securities Action, the Proxy Action and the Board Observer Action, all defined below. On July 23, 2014, the Delaware Court of Chancery approved the Settlement Stipulation, which, pursuant to its terms, became effective on August 25, 2014 (the “Effective Date”). | ||||||||||
The Settlement Stipulation provided for the partial settlement and dismissal with prejudice of the action entitled OTK Associates, LLC v. Friedman, et al., C.A. No. 8447-VCL (Del. Ch.) (the “Delaware Shareholder Derivative Action”) and the complete settlement and dismissal with prejudice of the actions entitled Yucaipa American Alliance Fund II L.P., et al. v. Morgans Hotel Group Co., et al., Index No. 652294/2013 (NY Sup.) (the “New York Securities Action”); Burkle v. OTK Associates, LLC, et al., Case No. 13-CIV-4557 (S.D.N.Y.) (the “Proxy Action”); and Yucaipa American Alliance Fund II L.P., et al. v. Morgans Hotel Group Co., Index No. 653455/2013 (NY Sup.) (the “Board Observer Action”) (the foregoing four actions are collectively referred to as the “Actions”). | ||||||||||
The Settlement Stipulation provided, among other things, for the following: | ||||||||||
— | The Company paid the Yucaipa parties in the New York Securities Action an amount equal to $3.0 million (which was previously escrowed) for attorneys’ fees and expenses incurred by Mr. Burkle in his defense of the Delaware Shareholder Derivative Action (the “Securities Action Payment”). | |||||||||
— | The Company paid the reasonable and necessary attorneys’ fees and expenses incurred by Messrs. Friedman, Gault and Sasson (collectively, the “Settling Former Directors”) in defending the Delaware Shareholder Derivative Action. The Settling Former Directors’ assigned to the Company any claims they have against the Company’s insurers relating to any such unpaid amounts. The Company’s insurers covered these attorneys’ fees and expenses. | |||||||||
— | OTK and current director Jason T. Kalisman applied to the Delaware Court of Chancery for an award of payment from the Company of the reasonable and necessary fees and expenses incurred by their counsel in connection with the Delaware Shareholder Derivative Action, excluding those fees and expenses encompassed in the court’s October 31, 2013 order in the Delaware Shareholder Derivative Action. In its July 23, 2014 order approving the Settlement Stipulation, the Delaware Court of Chancery awarded an aggregate amount of approximately $6.5 million (to be reduced by the prior interim award of approximately $2.7 million) to OTK and current director Jason T. Kalisman for their counsel fees and expenses incurred in connection with the Delaware Shareholder Derivative Action which was paid by the Company with insurance proceeds. | |||||||||
— | Plaintiffs and defendants in each of the Actions, apart from the former directors who chose not to participate in Settlement Stipulation and against whom the Delaware Shareholder Derivative Action continues, exchanged customary releases which release the parties and certain of their affiliates from claims arising from the subject matters of each of the Actions. | |||||||||
— | Each of the Actions was dismissed with prejudice and on the merits with each party bearing its own costs, except as to the former directors who have not settled, against whom the Delaware Shareholder Derivative Action continues or as specified in the Settlement Stipulation. | |||||||||
The Company’s insurers have paid a majority of the costs that the Company was obligated to pay under the Settlement Stipulation. | ||||||||||
On October 3, 2014, the Company entered into a Memorandum of Understanding with OTK and Thomas L. Harrison (the “Harrison Settlement”) to settle the claims against Mr. Harrison in the Delaware Shareholder Derivative Action and also to settle claims Mr. Harrison has asserted against the Company in Harrison v. Morgans Hotel Group Co., C. A. No. 10100-VCL (Del. Ch.) (the “Harrison Advancement Action”), in which Mr. Harrison seeks an order requiring the Company to advance his expenses (including attorneys’ fees) incurred in connection with the Delaware Shareholder Derivative Action and further seeks indemnification of the expenses (including attorneys’ fees) he has incurred in connection with his efforts to enforce his claims to advancement. The Harrison Settlement is subject to approval by the Delaware Court of Chancery. Pursuant to the Harrison Settlement, in October 2014, the Company advanced to Mr. Harrison a portion of the fees and expenses for which he has sought advancement and paid a portion of the amounts for which Mr. Harrison seeks indemnification related to the Harrison Advancement Action. As part of the consideration for the release of the claims against Mr. Harrison in the Delaware Shareholder Derivative Action, if the Harrison Settlement is approved by the Court of Chancery, Mr. Harrison would waive his claims to recover the remaining amounts for which he has sought advancement and indemnification in the Harrison Advancement Action. If the Delaware Court of Chancery approves the Harrison Settlement, both the Harrison Advancement Action and the claims against Mr. Harrison in the Delaware Shareholder Derivative Action will be dismissed with prejudice, the parties to the settlement will exchange customary releases, and the only remaining defendant in the Delaware Shareholder Derivative Action will be Michael D. Malone, a former director of the Company. | ||||||||||
As of September 30, 2014, the Company has paid approximately $0.4 million of costs that were not covered by insurance proceeds. The Company had established an accrual to cover certain contingencies related to its obligations under the Settlement Stipulation, which were adequate to cover these costs. The Company does not expect that the net amount of any remaining payments the Company will make under the terms of the Settlement Stipulation, the Harrison Settlement, or any other settlement with the former directors who have not settled will be material to financial position of the Company, and as of September 30, 2014, the Company believes its accruals are adequate to cover its contingencies relating to these matters. | ||||||||||
Other Litigation | ||||||||||
From time to time, the Company is involved in various litigation matters arising in the ordinary course of its business. The Company is not currently a party to any legal or administrative proceedings, other than as noted above, the adverse outcome of which, individually or in the aggregate, the Company believes would have a material impact on the Company’s financial condition, results of operations or cash flow. |
Omnibus_Stock_Incentive_Plan
Omnibus Stock Incentive Plan | 9 Months Ended | |||||||||||
Sep. 30, 2014 | ||||||||||||
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ' | |||||||||||
Omnibus Stock Incentive Plan | ' | |||||||||||
8. Omnibus Stock Incentive Plan | ||||||||||||
On February 9, 2006, the Board of Directors of the Company adopted the Morgans Hotel Group Co. 2006 Omnibus Stock Incentive Plan. Subsequently and on several occasions, the Company’s Board of Directors adopted, and stockholders approved, amendments to the Omnibus Stock Incentive Plan (the “Stock Plan”), to namely increase the number of shares reserved for issuance under the plan. As of September 30, 2014, the Stock Plan had 14,610,000 shares reserved for issuance. | ||||||||||||
The Stock Plan provides for the issuance of stock-based incentive awards, including incentive stock options, non-qualified stock options, stock appreciation rights, shares of common stock of the Company, including restricted stock units (“RSUs”) and other equity-based awards, including membership units in Morgans Group which are structured as profits interests (“LTIP Units”), or any combination of the foregoing. The eligible participants in the Stock Plan include directors, officers and employees of the Company. Awards other than options and stock appreciation rights reduce the shares available for grant by 1.7 shares for each share subject to such an award. | ||||||||||||
On August 14, 2014, the Company issued an aggregate of 77,922 RSUs to the Company’s non-employee directors under the Stock Plan. These grants become 100% vested on May 14, 2015, provided that upon a non-employee director’s resignation from the Board of Directors, other than as a consequence of the director’s bad acts, the vesting of any RSUs will be on a pro rated basis as of the resignation date. The estimated fair value of each such RSU granted was based on the closing price of the Company’s common stock on the grant date. | ||||||||||||
In addition, the Company has granted, or may grant, RSUs to certain executives, employees or non-employee directors as part of future annual equity grants or to newly hired or promoted employees from time to time. | ||||||||||||
A summary of stock-based incentive awards as of September 30, 2014 is as follows (in units, or shares, as applicable): | ||||||||||||
Restricted Stock | LTIP Units | Stock Options | ||||||||||
Units | ||||||||||||
Outstanding as of January 1, 2014 | 888,461 | 1,134,610 | 1,424,740 | |||||||||
Granted during 2014 | 271,701 | — | — | |||||||||
Distributed/exercised during 2014 | (710,939 | ) | (193,453 | ) | — | |||||||
Forfeited during 2014 | (101,756 | ) | — | (300,000 | ) | |||||||
Outstanding as of September 30, 2014 | 347,467 | 941,157 | 1,124,740 | |||||||||
Vested as of September 30, 2014 | — | 941,157 | 1,124,740 | |||||||||
Total stock compensation expense, which is included in corporate expenses on the accompanying consolidated statements of comprehensive loss, was $0.3 million, $1.3 million, $3.1 million, and $3.6 million for the three and nine months ended September 30, 2014 and 2013, respectively. | ||||||||||||
As of September 30, 2014 and December 31, 2013, there were approximately $1.8 million and $3.4 million, respectively, of total unrecognized compensation costs related to unvested share awards, excluding outstanding OPP LTIP Units, as discussed below. As of September 30, 2014, the weighted-average period over which the unrecognized compensation expense will be recorded is approximately 1.1 years. | ||||||||||||
Outperformance Award Program | ||||||||||||
In March 2011, the Compensation Committee of the Board of Directors of the Company implemented an Outperformance Award Program, which was a long-term incentive plan intended to provide the Company’s senior management with the ability to earn cash or equity awards based on the Company’s level of return to stockholders over a three-year period, the Company issued a new series of outperformance long-term incentive units (the “OPP LTIP Units”). | ||||||||||||
Pursuant to the Outperformance Award Program, each of the senior managers then employed by the Company had the right to receive, an award (an “Award”), in each case reflecting the participant’s right to receive a participating percentage (the “Participating Percentage”) in an outperformance pool if the Company’s total return to stockholders (including stock price appreciation plus dividends) increased by more than 30% (representing a compounded annual growth rate of approximately 9% per annum) over a three-year period from March 20, 2011 to March 20, 2014, of a new series of outperformance long-term incentive units as described below, subject to vesting and the achievement of certain performance targets. | ||||||||||||
The total return to stockholders was calculated based on the average closing price of the Company’s common shares on the 30 trading days ending on the Final Valuation Date (as defined below). The baseline value of the Company’s common shares for purposes of determining the total return to stockholders was $8.87, the closing price of the Company’s common shares on March 18, 2011. | ||||||||||||
The Company determined, as of March 20, 2014, that the total outperformance pool had no value, as the valuation on that day did not exceed $11.53, therefore all existing Awards of OPP LTIP Units were forfeited. | ||||||||||||
As the Company had the ability to settle the vested OPP LTIP Units with cash, these Awards were not considered to be indexed to the Company’s stock price and were accounted for as liabilities at fair value prior to their forfeiture on March 20, 2014. |
Preferred_Securities_and_Warra
Preferred Securities and Warrants | 9 Months Ended | |
Sep. 30, 2014 | ||
Equity [Abstract] | ' | |
Preferred Securities and Warrants | ' | |
9. Preferred Securities and Warrants | ||
Preferred Securities and Warrants Held by Yucaipa Investors | ||
On October 15, 2009, the Company entered into a Securities Purchase Agreement with the Yucaipa Investors. Under the agreement, the Company issued and sold to the Yucaipa Investors (i) $75.0 million of preferred stock comprised of 75,000 shares of the Company’s Series A preferred securities, $1,000 liquidation preference per share, and (ii) warrants to purchase 12,500,000 shares of the Company’s common stock at an exercise price of $6.00 per share, or the Yucaipa Warrants, which are exercisable utilizing a cashless exercise method only, resulting in a net share issuance. | ||
The Series A preferred securities have an 8% dividend rate through October 15, 2014, a 10% dividend rate from October 15, 2014 to October 15, 2016, and a 20% dividend rate thereafter. For so long as the Yucaipa Investors collectively own or have the right to purchase through exercise of the Yucaipa Warrants (assuming a cash rather than a cashless exercise) 875,000 shares of the Company’s common stock, the Company has agreed to use its reasonable best efforts to cause its Board of Directors to nominate and recommend to the Company’s stockholders the election of a person nominated by the Yucaipa Investors as a director of the Company and to use its reasonable best efforts to ensure that the Yucaipa Investors’ nominee is elected to the Company’s Board of Directors at each such meeting. If that nominee is not elected as a director at a meeting of stockholders, the Yucaipa Investors have certain Board of Director observer rights. Further, if the Company does not, within 30 days from the date of such meeting, create an additional seat on the Board of Directors and make available such seat to the nominee, the dividend rate on the Series A preferred securities increases by 4% during any time that a Yucaipa Investors’ nominee is not a member of the Company’s Board of Directors. From July 14, 2013 through May 14, 2014, the dividend rate was 12% as a result of the Yucaipa Investors’ nominee not being elected or appointed to the Company’s Board of Directors. | ||
On May 14, 2014, at the Company’s annual shareholder meeting, a Board of Directors nominee representing the Yucaipa Investors was elected as a director of the Company and the dividend rate on the Series A preferred securities returned to the stated rate of 8%. Currently, the dividend rate on the Series A preferred securities is 10%. | ||
The Company has the option to accrue any and all dividend payments. The cumulative unpaid dividends have a dividend rate equal to the dividend rate on the Series A preferred securities. As of September 30, 2014, the Company had undeclared and unpaid dividends of approximately $40.4 million. | ||
The Company has the option to redeem any or all of the Series A preferred securities at par at any time. The Series A preferred securities have limited voting rights and only vote on the authorization to issue senior preferred securities, amendments to their certificate of designations and amendments to the Company’s charter that adversely affect the Series A preferred securities. In addition, the Yucaipa Investors have consent rights over certain transactions for so long as they collectively own or have the right to purchase through exercise of the Yucaipa Warrants 6,250,000 shares of the Company’s common stock, including (subject to certain exceptions and limitations): | ||
— | the sale of substantially all of the Company’s assets to a third party; | |
— | the acquisition by the Company of a third party where the equity investment by the Company is $100.0 million or greater; | |
— | the acquisition of the Company by a third party; or | |
— | any change in the size of the Company’s Board of Directors to a number below 7 or above 9. | |
The Yucaipa Investors are subject to certain standstill arrangements as long as they beneficially own over 15% of the Company’s common stock. | ||
As discussed in note 2, the Yucaipa Warrants to purchase 12,500,000 shares of the Company’s common stock at an exercise price of $6.00 per share have a 7-1/2 year term and are exercisable utilizing a cashless exercise method only, resulting in a net share issuance. In accordance with ASC 815-10-15, the Yucaipa Warrants are accounted for as equity instruments indexed to the Company’s stock. The Yucaipa Investors’ right to exercise the Yucaipa Warrants to purchase 12,500,000 shares of the Company’s common stock expires in April 2017. | ||
The exercise price and number of shares subject to the Yucaipa Warrants are both subject to anti-dilution adjustments. | ||
The Company calculated the fair value of the Series A preferred securities at its net present value by discounting dividend payments expected to be paid on the shares over a seven-year period using a 17.3% rate. The Company determined that the market discount rate of 17.3% was reasonable based on the Company’s best estimate of what similar securities would most likely yield when issued by entities comparable to the Company at that time. | ||
The initial carrying value of the Series A preferred securities was recorded at its net present value less costs to issue on the date of issuance. The carrying value will be periodically adjusted for accretion of the discount. As of September 30, 2014, the value of the preferred securities was $65.7 million, which includes cumulative accretion of $17.6 million. | ||
The Company calculated the estimated fair value of the Yucaipa Warrants using the Black-Scholes valuation model, as discussed in note 2. | ||
Convertible Notes Held by Yucaipa Investors | ||
On April 21, 2010, the Company entered into a Waiver Agreement with the Yucaipa Investors, pursuant to which the Yucaipa Investors were permitted to purchase up to $88.0 million in aggregate principal amount of the Convertible Notes within six months of April 21, 2010 and subject to the limitations and conditions set forth therein. From April 21, 2010 to July 21, 2010, the Yucaipa Investors purchased $88.0 million of the Convertible Notes from third parties. On February 28, 2014, the Company entered into a Note Repurchase Agreement with the Yucaipa Investors, pursuant to which the Company repurchased the $88.0 million of Convertible Notes owned by them. Following the closing under the Note Repurchase Agreement, these Convertible Notes were retired. |
Related_Party_Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2014 | |
Related Party Transactions [Abstract] | ' |
Related Party Transactions | ' |
10. Related Party Transactions | |
The Company earned management fees, chain services fees and fees for certain technical services and has receivables from hotels it owns through investments in unconsolidated joint ventures. These fees totaled approximately $1.0 million, $2.4 million, $3.4 million, and $7.2 million for the three and nine months ended September 30, 2014 and 2013, respectively. | |
As of September 30, 2014 and December 31, 2013, the Company had receivables from these affiliates of approximately $3.8 million and $3.7 million, respectively, which are included in related party receivables on the accompanying consolidated balance sheets. | |
As of September 30, 2014 and December 31, 2013, the TLG Promissory Notes and accrued interest due to Messrs. Sasson and Masi had aggregate fair values of approximately $19.1 million and $18.8 million, respectively, as discussed in note 6, which are included in debt and capital lease obligations on the accompanying consolidated balance sheets. During the three and nine months ended September 30, 2014 and 2013, the Company recorded $0.3 million, $0.4 million, $1.1 million, and $1.1 million, respectively, of interest expense related to the TLG Promissory Notes. |
Other_Expenses
Other Expenses | 9 Months Ended | |||||||||||||||
Sep. 30, 2014 | ||||||||||||||||
Other Income And Expenses [Abstract] | ' | |||||||||||||||
Other Expenses | ' | |||||||||||||||
11. Other Expenses | ||||||||||||||||
Restructuring and disposal costs | ||||||||||||||||
These expenses primarily relate to costs incurred related to the Company’s corporate restructuring initiatives, such as professional fees, litigation and settlement costs, executive terminations and severance costs related to such restructuring initiatives, including the plan of termination implemented in March 2014 (the “Termination Plan”) that resulted in a workforce reduction of the Company’s corporate office employees, proxy contests, and gains and losses on asset disposals as part of major renovation projects. Restructuring and disposal costs consist of the following (in thousands): | ||||||||||||||||
Three Months | Three Months | Nine Months | Nine Months | |||||||||||||
Ended | Ended | Ended | Ended | |||||||||||||
30-Sep-14 | 30-Sep-13 | 30-Sep-14 | 30-Sep-13 | |||||||||||||
Restructuring costs | $ | 1,113 | $ | 939 | $ | 4,208 | $ | 6,121 | ||||||||
Severance and related costs | 29 | 827 | 8,395 | 1,620 | ||||||||||||
(Gain) loss on asset disposal and other costs | 3 | 33 | (234 | ) | 210 | |||||||||||
Total | $ | 1,145 | $ | 1,799 | $ | 12,369 | $ | 7,951 | ||||||||
As a result of the Termination Plan, which constituted a plan of termination under ASC 420, Exit or Disposal Cost Obligations, the Company recorded a charge of approximately $7.1 million in the first quarter of 2014 related to the cost of one-time termination benefits which have been or are expected to be paid in cash, which were recorded as ‘Severance and Related Costs’ in the above table. The Company also recorded a charge of approximately $1.8 million of non-cash stock compensation expense relating to the severance of former executives, which is included in Corporate Expense on the Company’s consolidated statement of comprehensive loss. | ||||||||||||||||
Development costs | ||||||||||||||||
These expenses primarily relate to transaction costs related to the acquisition or termination of projects, internal development payroll and other costs and pre-opening expenses incurred related to new concepts at existing hotel and the development of new hotels, and the write-off of abandoned development projects previously capitalized. Certain prior year amounts have been reclassified to conform to the current year presentation. Development costs consist of the following (in thousands): | ||||||||||||||||
Three Months | Three Months | Nine Months | Nine Months | |||||||||||||
Ended | Ended | Ended | Ended | |||||||||||||
30-Sep-14 | 30-Sep-13 | 30-Sep-14 | 30-Sep-13 | |||||||||||||
Transaction costs | $ | 259 | $ | 364 | $ | 2,839 | $ | 574 | ||||||||
Internal development payroll and other | 298 | 386 | 647 | 1,056 | ||||||||||||
Pre-opening expenses | 7 | 221 | 442 | 738 | ||||||||||||
Total | $ | 564 | $ | 971 | $ | 3,928 | $ | 2,368 | ||||||||
Deferred_Gain_on_Asset_Sales
Deferred Gain on Asset Sales | 9 Months Ended |
Sep. 30, 2014 | |
Revenue Recognition [Abstract] | ' |
Deferred Gain on Asset Sales | ' |
12. Deferred Gain on Asset Sales | |
In 2011, the Company sold Mondrian Los Angeles, Royalton, Morgans, and its 50% equity interest in the joint venture that owned Sanderson and St Martins Lane. The Company continues to operate all of these hotels under long-term management agreements. | |
In accordance with ASC 360-20, Property, Plant and Equipment, Real Estate Sales. the Company evaluated its accounting for the gain on sales of these assets, noting that the Company continues to have significant continuing involvement in the hotels as a result of long-term management agreements and shares in risks and rewards of ownership. Accordingly, the Company recorded deferred gains of approximately $152.4 million related to the sales of Royalton, Morgans, Mondrian Los Angeles, and the Company’s equity interests in Sanderson and St Martins Lane, which are deferred and recognized as a gain on asset sales over the initial term of the related management agreements. Gain on asset sales for the three and nine months ended September 30, 2014 and 2013 were $2.0 million, $2.0 million, $6.0 million, and $6.0 million, respectively. |
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2014 | |
Accounting Policies [Abstract] | ' |
Recent Accounting Updates | ' |
ERROR: Could not retrieve Word content for note block | |
Basis of Presentation | ' |
Basis of Presentation | |
The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The Company consolidates all wholly-owned subsidiaries and variable interest entities in which the Company is determined to be the primary beneficiary. All intercompany balances and transactions have been eliminated in consolidation. Entities which the Company does not control through voting interest and entities which are variable interest entities of which the Company is not the primary beneficiary, are accounted for under the equity method. | |
The consolidated financial statements have been prepared in accordance with GAAP for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. The information furnished in the accompanying consolidated financial statements reflects all adjustments that, in the opinion of management, are necessary for a fair presentation of the aforementioned consolidated financial statements for the interim periods. | |
Operating results for the three and nine months ended September 30, 2014 are not necessarily indicative of the results that may be expected for the year ending December 31, 2014. For further information, refer to the consolidated financial statements and accompanying footnotes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013. | |
Use of Estimates | ' |
Use of Estimates | |
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. | |
Restricted Cash | ' |
Restricted Cash | |
As required by certain debt and lease agreements, restricted cash consists of cash held in escrow accounts for taxes, ground rent, insurance premiums, and debt service or lease payments. | |
The Hudson/Delano 2014 Mortgage Loan, defined and discussed below in note 6, provides that, in the event the debt yield ratio falls below certain defined thresholds, all cash flows from Hudson and Delano South Beach are deposited into accounts controlled by the lenders from which debt service and operating expenses, including management fees, are paid and from which other reserve accounts may be funded. Any excess amounts will be retained by the lenders until the debt yield ratio exceeds the required thresholds for two consecutive calendar quarters. As of September 30, 2014, the debt yield ratio exceeded the required threshold. | |
As further required by the debt and lease agreements related to hotels owned by the Company or one of its subsidiaries, the Company must set aside 4% of the hotels’ revenues in restricted escrow accounts for the future periodic replacement or refurbishment of furniture, fixtures and equipment. As replacements occur, the Company or its subsidiary is eligible for reimbursement from these escrow accounts. | |
As of September 30, 2014, restricted cash also consisted of cash held in escrow for insurance program escrows. | |
Investments in and Advances to Unconsolidated Joint Ventures | ' |
Investments in and Advances to Unconsolidated Joint Ventures | |
The Company accounts for its investments in unconsolidated joint ventures using the equity method as it does not exercise control over significant business decisions such as buying, selling or financing nor is it the primary beneficiary under ASC 810-10, as discussed above. Under the equity method, the Company increases its investment for its proportionate share of net income and contributions to the joint venture and decreases its investment balance by recording its proportionate share of net loss and distributions. Once the Company’s investment balance in an unconsolidated joint venture is zero, the Company suspends recording additional losses. For investments in which there is recourse or unfunded commitments to provide additional equity, distributions and losses in excess of the investment are recorded as a liability. As of September 30, 2014, there were no liabilities required to be recorded related to these investments. | |
Investment in TLG Management Contracts, net | ' |
Investment in TLG Management Contracts, net | |
Investment in TLG management contracts represents the value of the TLG management contracts. TLG operates numerous nightclubs, restaurants, pool lounges, and bar venues primarily in Las Vegas pursuant to management agreements with MGM. The management contract assets are being amortized, using the straight line method, over the life of each applicable management contract. | |
Other Assets | ' |
Other Assets | |
In August 2012, the Company entered into a 10-year licensing agreement with MGM, with two five-year extensions at the Company’s option subject to performance thresholds, to convert THEhotel to Delano Las Vegas, which is managed by MGM. Delano Las Vegas opened in September 2014. In addition, the Company acquired the leasehold interests in three food and beverage venues at Mandalay Bay in Las Vegas from an existing tenant for $15.0 million in cash at closing and a deferred, principal-only $10.6 million promissory note (“Restaurant Lease Note”) to be paid over seven years, which the Company recorded at fair value as of the date of issuance of $7.5 million, as discussed in note 6. The venues have been reconcepted and renovated and are managed by TLG. The three food and beverage venues are being operated pursuant to 10-year operating leases with an MGM affiliate, pursuant to which the Company pays minimum annual lease payments and a percentage rent based on cash flow. The Company allocated the total consideration paid, or to be paid, to the license agreement and the restaurant leasehold asset based on their respective fair values. The Company amortizes the fair value of the license agreement, using the straight line method, over the 10-year life of the license agreement, and the fair value of the restaurant leasehold interests, using the straight line method, over the 10-year life of the operating leases. | |
Further, as of September 30, 2014, other assets primarily consist of deferred financing costs which are being amortized, using the straight line method, which approximates the effective interest rate method, over the terms of the related debt agreements. | |
Income Taxes | ' |
Income Taxes | |
The Company accounts for income taxes in accordance with ASC 740-10, Income Taxes, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the tax and financial reporting basis of assets and liabilities and for loss and credit carry forwards. Valuation allowances are provided when it is more likely than not that the recovery of deferred tax assets will not be realized. | |
The Company’s deferred tax assets are recorded net of a valuation allowance when, based on the weight of available evidence, it is more likely than not that some portion or all of the recorded deferred tax assets will not be realized in future periods. Decreases to the valuation allowance are recorded as reductions to the Company’s provision for income taxes and increases to the valuation allowance result in additional provision for income taxes. The realization of the Company’s deferred tax assets, net of the valuation allowance, is primarily dependent on estimated future taxable income. A change in the Company’s estimate of future taxable income may require an addition to or reduction from the valuation allowance. The Company has established a reserve on its deferred tax assets based on anticipated future taxable income and tax strategies which may include the sale of property or an interest therein. | |
All of the Company’s foreign subsidiaries are subject to local jurisdiction corporate income taxes. Income tax expense is reported at the applicable rate for the periods presented. | |
Income taxes for the three and nine months ended September 30, 2014 and 2013, were computed using the Company’s effective tax rate. | |
Credit-risk-related Contingent Features | ' |
Credit-risk-related Contingent Features | |
The Company entered into agreements with each of its derivative counterparties in connection with the interest rate caps and hedging instruments related to the 2.375% Senior Subordinated Convertible Notes (the “Convertible Notes”), as discussed in note 6, which were outstanding as of September 30, 2014 and which matured and were repaid in full on October 15, 2014. The agreements provided that in the event the Company either defaulted or was capable of being declared in default on any of its indebtedness, the Company could also be declared in default on its derivative obligations. These Convertible Notes Call Options and Convertible Notes Warrants, as discussed and defined in note 6, expired when the Convertible Notes were repaid in October 2014. | |
The Company has entered into warrant agreements with Yucaipa American Alliance Fund II, L.P. and Yucaipa American Alliance (Parallel) Fund II, L.P., (collectively, the “Yucaipa Investors”), as discussed in note 9, to purchase a total of 12,500,000 shares of the Company’s common stock at an exercise price of $6.00 per share (the “Yucaipa Warrants”). In addition, the Yucaipa Investors have certain consent rights over certain transactions for so long as they collectively own or have the right to purchase through exercise of the Yucaipa Warrants 6,250,000 shares of the Company’s common stock. The Yucaipa Warrants are exercisable utilizing a cashless exercise method only, resulting in a net share issuance. | |
Fair Value Measurements | ' |
Fair Value Measurements | |
ASC 820-10, Fair Value Measurements and Disclosures (“ASC 820-10”) defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. ASC 820-10 applies to reported balances that are required or permitted to be measured at fair value under existing accounting pronouncements; accordingly, the standard does not require any new fair value measurements of reported balances. | |
ASC 820-10 emphasizes that fair value is a market-based measurement, not an entity-specific measurement. Therefore, a fair value measurement should be determined based on the assumptions that market participants would use in pricing the asset or liability. As a basis for considering market participant assumptions in fair value measurements, ASC 820-10 establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy). | |
Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access. Level 2 inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs may include quoted prices for similar assets and liabilities in active markets, as well as inputs that are observable for the asset or liability (other than quoted prices), such as interest rates and yield curves that are observable at commonly quoted intervals. Level 3 inputs are unobservable inputs for the asset or liability, which is typically based on an entity’s own assumptions, as there is little, if any, related market activity. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the asset or liability. | |
Currently, the Company uses interest rate caps to manage its interest rate risk. The valuation of these instruments is determined using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities. To comply with the provisions of ASC 820-10, the Company incorporates credit valuation adjustments to appropriately reflect both its own nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements. In adjusting the fair value of its derivative contracts for the effect of nonperformance risk, the Company has considered the impact of netting and any applicable credit enhancements, such as collateral postings, thresholds, mutual puts, and guarantees. Although the Company has determined that the majority of the inputs used to value its derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with its derivatives utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by itself and its counterparties. However, as of September 30, 2014 and December 31, 2013, the Company assessed the significance of the impact of the credit valuation adjustments on the overall valuation of its derivative positions and determined that the credit valuation adjustments are not significant to the overall valuation of its derivatives. Accordingly, all derivatives have been classified as Level 2 fair value measurements. As of September 30, 2014, the Company had three interest rate caps outstanding and the fair value of these interest rate caps was $0.2 million. | |
In connection with The Light Group Transaction, the Company provided Messrs. Sasson and Masi with the Sasson-Masi Put Options. Due to the redemption feature associated with the Sasson-Masi Put Options, the Company classified the noncontrolling interest in temporary equity. Subsequently, the Company will accrete the redeemable noncontrolling interest to its current redemption value, which approximates fair value, each period. The Company has determined that the majority of the inputs used to value the Sasson-Masi Put Options fall within Level 3 of the fair value hierarchy. Accordingly, the Sasson-Masi Put Options have been classified as Level 3 fair value measurements. | |
In connection with the three restaurant leases in Las Vegas, the Company issued the Restaurant Lease Note to be paid over seven years. The Restaurant Lease Note does not bear interest except in the event of default, as defined by the agreement. In accordance with ASC 470, Debt, the Company imputed interest on the Restaurant Lease Note, which is recorded at fair value on the accompanying consolidated balance sheets. On the date of grant, the Company determined the fair value of the Restaurant Lease Note to be $7.5 million imputing an interest rate of 10%. The Company has determined that the majority of the inputs used to value the Restaurant Lease Note fall within Level 2 of the fair value hierarchy, which accordingly has been classified as Level 2 fair value measurements. | |
Fair Value of Financial Instruments | ' |
Fair Value of Financial Instruments | |
Disclosures about fair value of financial instruments are based on pertinent information available to management as of the valuation date. Considerable judgment is necessary to interpret market data and develop estimated fair values. Accordingly, the estimates presented are not necessarily indicative of the amounts at which these instruments could be purchased, sold, or settled. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts. | |
The Company’s financial instruments include cash and cash equivalents, accounts receivable, restricted cash, accounts payable and accrued liabilities, and fixed and variable rate debt. Management believes the carrying amounts of the aforementioned financial instruments, excluding fixed-rate debt, is a reasonable estimate of fair value as of September 30, 2014 and December 31, 2013 due to the short-term maturity of these instruments or variable market interest rates on certain debt instruments. | |
The Company had fixed rate debt of $123.1 million and $247.1 million as of September 30, 2014 and December 31, 2013, respectively, which included the Company’s trust preferred securities, TLG Promissory Notes, excluding accrued interest, Restaurant Lease Note, discussed above, and the Convertible Notes at face value, as discussed in note 6. This fixed rate debt had a fair market value at September 30, 2014 and December 31, 2013 of approximately $136.0 million and $217.7 million, respectively, using market rates. | |
Stock-based Compensation | ' |
Stock-based Compensation | |
The Company accounts for stock based employee compensation using the fair value method of accounting described in ASC 718-10. For share grants, total compensation expense is based on the price of the Company’s stock at the grant date. For option grants, the total compensation expense is based on the estimated fair value using the Black-Scholes option-pricing model. Compensation expense is recorded ratably over the vesting period. | |
Income (Loss) Per Share | ' |
Income (Loss) Per Share | |
Basic net income (loss) per common share is calculated by dividing net income (loss) available to common stockholders, less any dividends on unvested restricted common stock, by the weighted-average number of shares of common stock outstanding during the period. Diluted net income (loss) per common share is calculated by dividing net income (loss) available to common stockholders, less dividends on unvested restricted common stock, by the weighted-average number of shares of common stock outstanding during the period, plus other potentially dilutive securities, such as unvested shares of restricted common stock and warrants. | |
Redeemable Noncontrolling Interest | ' |
Redeemable Noncontrolling Interest | |
Due to the redemption feature associated with the Sasson-Masi Put Options, the Company classifies the noncontrolling interest in temporary equity in accordance with the Securities and Exchange Commission’s guidance as codified in ASC 480-10, Distinguishing Liabilities from Equity. Subsequently, the Company will accrete the redeemable noncontrolling interest to its current redemption value, which approximates fair value, each period. The change in the redemption value does not impact the Company’s earnings or earnings per share. | |
Noncontrolling Interest | ' |
Noncontrolling Interest | |
The Company follows ASC 810-10, when accounting and reporting for noncontrolling interests in a consolidated subsidiary and the deconsolidation of a subsidiary. Under ASC 810-10, the Company reports noncontrolling interests in subsidiaries as a separate component of stockholders’ equity (deficit) in the consolidated financial statements and reflects net income (loss) attributable to the noncontrolling interests and net income (loss) attributable to the common stockholders on the face of the consolidated statements of comprehensive loss. | |
The membership units owned by the Former Parent in Morgans Group are presented as a noncontrolling interest in Morgans Group in the consolidated balance sheets and were approximately $0.4 million and $0.5 million as of September 30, 2014 and December 31, 2013, respectively. The noncontrolling interest in Morgans Group is: (i) increased or decreased by the holders of membership interests’ pro rata share of Morgans Group’s net income or net loss, respectively; (ii) decreased by distributions; (iii) decreased by exchanges of membership units for the Company’s common stock; and (iv) adjusted to equal the net equity of Morgans Group multiplied by the holders of membership interests’ ownership percentage immediately after each issuance of units of Morgans Group and/or shares of the Company’s common stock and after each purchase of treasury stock through an adjustment to additional paid-in capital. Net income or net loss allocated to the noncontrolling interest in Morgans Group is based on the weighted-average percentage ownership throughout the period. As of September 30, 2014, there were 75,446 membership units outstanding, each of which is exchangeable for a share of the Company’s common stock. | |
Reclassifications | ' |
Reclassifications | |
Certain prior period financial statement amounts have been reclassified to conform to the current period presentation. |
Organization_and_Formation_Tra1
Organization and Formation Transaction (Tables) | 9 Months Ended | |||||||||
Sep. 30, 2014 | ||||||||||
Organization Consolidation And Presentation Of Financial Statements [Abstract] | ' | |||||||||
Operating Hotels | ' | |||||||||
The Company’s hotels as of September 30, 2014 were as follows: | ||||||||||
Hotel Name | Location | Number of | Ownership | |||||||
Rooms | ||||||||||
Hudson | New York, NY | 876 | (1 | ) | ||||||
Morgans | New York, NY | 117 | (2 | ) | ||||||
Royalton | New York, NY | 168 | (2 | ) | ||||||
Mondrian SoHo | New York, NY | 263 | (3 | ) | ||||||
Delano South Beach | Miami Beach, FL | 194 | (4 | ) | ||||||
Mondrian South Beach | Miami Beach, FL | 214 | (5 | ) | ||||||
Shore Club | Miami Beach, FL | 308 | (6 | ) | ||||||
Mondrian Los Angeles | Los Angeles, CA | 236 | (2 | ) | ||||||
Clift | San Francisco, CA | 372 | (7 | ) | ||||||
Sanderson | London, England | 150 | (2 | ) | ||||||
St Martins Lane | London, England | 204 | (2 | ) | ||||||
Mondrian London at Sea Containers | London, England | 359 | (2 | ) | ||||||
Delano Las Vegas | Las Vegas, Nevada | 1,117 | (8 | ) | ||||||
-1 | The Company owns 100% of Hudson through its subsidiary, Henry Hudson Holdings LLC, which is part of a property that is structured as a condominium, in which Hudson constitutes 96% of the square footage of the entire building. As of September 30, 2014, Hudson had 876 guest rooms and 60 single room dwelling units (“SROs”). | |||||||||
-2 | Operated under a management contract. | |||||||||
-3 | Operated under a management contract and owned through an unconsolidated joint venture in which the Company held a minority ownership interest of approximately 20% at September 30, 2014. See note 4. | |||||||||
-4 | Wholly-owned hotel. | |||||||||
-5 | Operated as a condominium hotel under a management contract and owned through a 50/50 unconsolidated joint venture. As of September 30, 2014, 261 hotel residences had been sold, of which 140 are in the hotel rental pool and are included in the hotel room count, and 74 hotel residences remain to be sold. See note 4. | |||||||||
-6 | Operated under a management contract. Until December 30, 2013, the Company held a minority ownership interest of approximately 7% and accounted for the hotel as an unconsolidated joint venture. As of September 30, 2014, the Company had an immaterial contingent profit participation equity interest in Shore Club. See note 4. | |||||||||
-7 | The hotel is operated under a long-term lease which is accounted for as a financing. See note 6. | |||||||||
-8 | A licensed hotel managed by MGM. | |||||||||
Income_Loss_Per_Share_Tables
Income (Loss) Per Share (Tables) | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Earnings Per Share [Abstract] | ' | |||||||
Components of Basic and Diluted Loss Per Share Calculations | ' | |||||||
The table below details the components of the basic and diluted loss per share calculations (in thousands, except for per share data). The Company has not had any undistributed earnings in any calendar quarter presented. Therefore, the Company does not present earnings per share following the two-class method. | ||||||||
Three Months | Three Months | |||||||
Ended | Ended | |||||||
30-Sep-14 | 30-Sep-13 | |||||||
Numerator: | ||||||||
Net loss | $ | (10,095 | ) | $ | (10,328 | ) | ||
Net (income) loss attributable to noncontrolling interest | (48 | ) | - | |||||
Net loss attributable to Morgans Hotel Group Co. | (10,143 | ) | (10,328 | ) | ||||
Less: preferred stock dividends and accretion | 3,594 | 4,037 | ||||||
Net loss attributable to common stockholders | $ | (13,737 | ) | $ | (14,365 | ) | ||
Denominator, continuing and discontinued operations: | ||||||||
Weighted average basic common shares outstanding | 34,267 | 32,693 | ||||||
Effect of dilutive securities | — | — | ||||||
Weighted average diluted common shares outstanding | 34,267 | 32,693 | ||||||
Basic and diluted loss available to common stockholders per common share | $ | (0.40 | ) | $ | (0.44 | ) | ||
Nine Months | Nine Months | |||||||
Ended | Ended | |||||||
30-Sep-14 | 30-Sep-13 | |||||||
Numerator: | ||||||||
Net loss | $ | (43,493 | ) | $ | (38,051 | ) | ||
Net (income) loss attributable to noncontrolling interest | (504 | ) | 298 | |||||
Net loss attributable to Morgans Hotel Group Co. | (43,997 | ) | (37,753 | ) | ||||
Less: preferred stock dividends and accretion | 11,948 | 9,976 | ||||||
Net loss attributable to common stockholders | $ | (55,945 | ) | $ | (47,729 | ) | ||
Denominator, continuing and discontinued operations: | ||||||||
Weighted average basic common shares outstanding | 34,047 | 32,590 | ||||||
Effect of dilutive securities | — | — | ||||||
Weighted average diluted common shares outstanding | 34,047 | 32,590 | ||||||
Basic and diluted loss available to common stockholders per common share | $ | (1.64 | ) | $ | (1.46 | ) | ||
Investments_in_and_Advances_to1
Investments in and Advances to Unconsolidated Joint Ventures (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2014 | ||||||||||||||||
Equity Method Investments And Joint Ventures [Abstract] | ' | |||||||||||||||
Investments in and Advances to Unconsolidated Joint Ventures and Equity Losses | ' | |||||||||||||||
The Company’s investments in and advances to unconsolidated joint ventures and its equity in income (losses) of unconsolidated joint ventures are summarized as follows (in thousands): | ||||||||||||||||
Investments | ||||||||||||||||
Entity | As of | As of | ||||||||||||||
September 30, | December 31, | |||||||||||||||
2014 | 2013 | |||||||||||||||
Mondrian Istanbul | $ | 10,392 | $ | 10,392 | ||||||||||||
Other | 100 | 100 | ||||||||||||||
Total investments in and advances to unconsolidated joint | $ | 10,492 | $ | 10,492 | ||||||||||||
ventures | ||||||||||||||||
Equity in Income (Losses) from Unconsolidated Joint Ventures | ' | |||||||||||||||
Equity in income (losses) of unconsolidated joint ventures | ||||||||||||||||
Three Months | Three Months | Nine Months | Nine Months | |||||||||||||
Ended | Ended | Ended | Ended | |||||||||||||
30-Sep-14 | 30-Sep-13 | 30-Sep-14 | 30-Sep-13 | |||||||||||||
Mondrian South Beach food and | $ | — | $ | (281 | ) | $ | — | $ | (629 | ) | ||||||
beverage—MC South Beach | ||||||||||||||||
Other | 3 | 3 | 7 | (144 | ) | |||||||||||
Total | $ | 3 | $ | (278 | ) | $ | 7 | $ | (773 | ) | ||||||
Other_Liabilities_Tables
Other Liabilities (Tables) | 9 Months Ended | |||||||
Sep. 30, 2014 | ||||||||
Other Liabilities Disclosure [Abstract] | ' | |||||||
Other Liabilities | ' | |||||||
Other liabilities consist of the following (in thousands): | ||||||||
As of | As of | |||||||
September 30, | December 31, | |||||||
2014 | 2013 | |||||||
Designer fee claim | $ | 13,866 | $ | 13,866 | ||||
OPP LTIP Units Liability (note 8) | — | 25 | ||||||
$ | 13,866 | $ | 13,891 | |||||
Debt_and_Capital_Lease_Obligat1
Debt and Capital Lease Obligations (Tables) | 9 Months Ended | |||||||||
Sep. 30, 2014 | ||||||||||
Debt Disclosure [Abstract] | ' | |||||||||
Debt and Capital Lease Obligations | ' | |||||||||
Debt and capital lease obligations consists of the following (in thousands): | ||||||||||
Description | As of | As of | Interest rate at | |||||||
September 30, | December 31, | September 30, | ||||||||
2014 | 2013 | 2014 | ||||||||
Hudson/Delano Mortgage (a) | $ | 450,000 | $ | — | 5.80% (LIBOR + 5.65%) | |||||
Notes secured by Hudson (a) | — | 180,000 | ||||||||
Clift debt (b) | 93,396 | 91,486 | 9.60% | |||||||
Liability to subsidiary trust (c) | 50,100 | 50,100 | 8.68% | |||||||
Convertible Notes (d) | 49,015 | 170,698 | 2.38% | |||||||
TLG Promissory Notes (e) | 19,096 | 18,807 | (f) | |||||||
Restaurant Lease Note (f) | 5,926 | 6,551 | (h) | |||||||
Capital lease obligations (g) | 6,105 | 6,109 | (g) | |||||||
Revolving credit facility (h) | — | 37,000 | ||||||||
Debt and capital lease obligation | $ | 673,638 | $ | 560,751 | ||||||
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 9 Months Ended | |||||||||
Sep. 30, 2014 | ||||||||||
Commitments And Contingencies Disclosure [Abstract] | ' | |||||||||
Hotel Commitments and Guarantees | ' | |||||||||
The following table details, as of September 30, 2014 and December 31, 2013, the Company’s key money, equity investment and debt financing commitments for hotels under development as well as potential funding obligations under cash flow guarantees at operating hotels and hotels under development at the maximum amount under the applicable contracts, but excluding contracts where the maximum amount cannot be determined (in thousands): | ||||||||||
As of | As of | |||||||||
September 30, | December 31, | |||||||||
2014 (1) | 2013 (1) | |||||||||
Key money, equity investment and debt financing commitments (2) | $ | 15,514 | $ | 22,499 | ||||||
Key money commitments related to terminated project (3) | — | 10,000 | ||||||||
Cash flow guarantees | 5,000 | 13,000 | ||||||||
Cash flow guarantees in dispute (4) | 8,000 | 8,000 | ||||||||
Total maximum future funding commitments | $ | 28,514 | $ | 53,499 | ||||||
Amounts due within one year (5) | $ | 15,514 | $ | 25,499 | ||||||
-1 | The currency translation is based on an exchange rate of the applicable local currency to U.S. dollar using the exchange rate as of the end of the applicable reporting period. | |||||||||
-2 | As of September 30, 2014 and December 31, 2013, these commitments consist of key money commitments. The Company had no equity or debt financing commitments at September 30, 2014 and December 31, 2013. | |||||||||
-3 | As of December 31, 2013, amount reflects the funding of $10.0 million in key money for Mondrian at Baha Mar, which the Company is not obligated to fund due to the termination of the related management agreement in June 2014, discussed further below. | |||||||||
-4 | Reflects an $8.0 million performance cash flow guarantee related to Delano Marrakech, which the Company believes it is not obligated to fund due to the owner’s defaults under the management agreement terms. The Company has terminated its management agreement effective November 12, 2013, discussed further below. | |||||||||
-5 | As of September 30, 2014, amount primarily consists of £9.4 million (or approximately $15.3 million at the exchange rate as of September 30, 2014) in key money for Mondrian London. As of December 31, 2013, amount represents key money for Mondrian London and Mondrian at Baha Mar. The Company is not obligated to fund the key money for Mondrian Baha Mar due to the termination of the related management agreement in June 2014, discussed further below. | |||||||||
License or Franchise Agreements for New Hotels Which are in Development Stage | ' | |||||||||
The Company has signed management, license or franchise agreements for new hotels which are in the development stage. As of September 30, 2014, these included the following: | ||||||||||
Expected Room | Anticipated | Initial | ||||||||
Count | Opening | Term | ||||||||
Hotels Currently Under Construction or Renovation: | ||||||||||
10 Karakoy, a Morgans Original, Istanbul (1) | 71 | 2014 | 15 years | |||||||
Mondrian Doha | 270 | 2015 | 30 years | |||||||
Other Signed Agreements: | ||||||||||
Mondrian Istanbul | 122 | 20 years | ||||||||
Delano Aegean Sea | 150 | 20 years | ||||||||
Delano Cartagena | 211 | 20 years | ||||||||
-1 | Hotel is subject to a license or franchise agreement. |
Omnibus_Stock_Incentive_Plan_T
Omnibus Stock Incentive Plan (Tables) | 9 Months Ended | |||||||||||
Sep. 30, 2014 | ||||||||||||
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ' | |||||||||||
Summary of Stock-based Incentive Awards | ' | |||||||||||
A summary of stock-based incentive awards as of September 30, 2014 is as follows (in units, or shares, as applicable): | ||||||||||||
Restricted Stock | LTIP Units | Stock Options | ||||||||||
Units | ||||||||||||
Outstanding as of January 1, 2014 | 888,461 | 1,134,610 | 1,424,740 | |||||||||
Granted during 2014 | 271,701 | — | — | |||||||||
Distributed/exercised during 2014 | (710,939 | ) | (193,453 | ) | — | |||||||
Forfeited during 2014 | (101,756 | ) | — | (300,000 | ) | |||||||
Outstanding as of September 30, 2014 | 347,467 | 941,157 | 1,124,740 | |||||||||
Vested as of September 30, 2014 | — | 941,157 | 1,124,740 | |||||||||
Other_Expenses_Tables
Other Expenses (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2014 | ||||||||||||||||
Other Income And Expenses [Abstract] | ' | |||||||||||||||
Restructuring and Disposal Costs | ' | |||||||||||||||
Restructuring and disposal costs consist of the following (in thousands): | ||||||||||||||||
Three Months | Three Months | Nine Months | Nine Months | |||||||||||||
Ended | Ended | Ended | Ended | |||||||||||||
30-Sep-14 | 30-Sep-13 | 30-Sep-14 | 30-Sep-13 | |||||||||||||
Restructuring costs | $ | 1,113 | $ | 939 | $ | 4,208 | $ | 6,121 | ||||||||
Severance and related costs | 29 | 827 | 8,395 | 1,620 | ||||||||||||
(Gain) loss on asset disposal and other costs | 3 | 33 | (234 | ) | 210 | |||||||||||
Total | $ | 1,145 | $ | 1,799 | $ | 12,369 | $ | 7,951 | ||||||||
Development Costs | ' | |||||||||||||||
Development costs consist of the following (in thousands): | ||||||||||||||||
Three Months | Three Months | Nine Months | Nine Months | |||||||||||||
Ended | Ended | Ended | Ended | |||||||||||||
30-Sep-14 | 30-Sep-13 | 30-Sep-14 | 30-Sep-13 | |||||||||||||
Transaction costs | $ | 259 | $ | 364 | $ | 2,839 | $ | 574 | ||||||||
Internal development payroll and other | 298 | 386 | 647 | 1,056 | ||||||||||||
Pre-opening expenses | 7 | 221 | 442 | 738 | ||||||||||||
Total | $ | 564 | $ | 971 | $ | 3,928 | $ | 2,368 | ||||||||
Debt_and_Capital_Lease_Obligat2
Debt and Capital Lease Obligations (Parenthetical) (Detail) (USD $) | 9 Months Ended | 9 Months Ended | 1 Months Ended | 9 Months Ended | 0 Months Ended | 0 Months Ended | 9 Months Ended | 1 Months Ended | 0 Months Ended | 9 Months Ended | 0 Months Ended | 1 Months Ended | 9 Months Ended | 0 Months Ended | 0 Months Ended | 9 Months Ended | 9 Months Ended | 0 Months Ended | 9 Months Ended | 0 Months Ended | 9 Months Ended | 0 Months Ended | 9 Months Ended | 1 Months Ended | 1 Months Ended | 0 Months Ended | ||||||||||||||||||||||||||||||
Sep. 30, 2014 | Dec. 31, 2013 | Jul. 21, 2010 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Aug. 31, 2012 | Sep. 30, 2014 | Nov. 30, 2011 | Nov. 30, 2011 | Sep. 30, 2014 | Nov. 30, 2011 | Nov. 30, 2011 | Nov. 30, 2011 | Aug. 04, 2006 | Sep. 30, 2014 | Oct. 31, 2007 | Feb. 06, 2014 | Jul. 28, 2011 | Sep. 30, 2014 | Jul. 28, 2011 | Jul. 28, 2011 | Jul. 28, 2011 | Oct. 31, 2007 | Sep. 30, 2014 | Dec. 31, 2013 | Oct. 17, 2007 | Oct. 15, 2014 | Feb. 06, 2014 | Feb. 06, 2014 | Feb. 06, 2014 | Sep. 30, 2014 | Apr. 08, 2014 | Sep. 30, 2014 | Nov. 14, 2012 | Sep. 30, 2014 | Nov. 14, 2012 | Nov. 14, 2012 | Oct. 31, 2004 | Sep. 30, 2014 | Dec. 31, 2013 | Oct. 14, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Jul. 21, 2010 | Oct. 31, 2007 | Sep. 30, 2014 | Dec. 31, 2013 | Aug. 31, 2012 | Sep. 30, 2014 | Dec. 31, 2013 | Jul. 28, 2011 | |
Hudson Lease | Hudson Lease | Hudson Lease 1 and Lease 2 | Hudson Lease 1 | Hudson Lease Lease 2 | Convert The Hotel To Delano Las Vegas | TLG Promissory Notes | TLG Promissory Notes | The Light Group LLC | The Light Group LLC | The Light Group LLC | Mr. Sasson | Mr. Masi | Liability to Subsidiary Trust Issuing Preferred Securities | Liability to Subsidiary Trust Issuing Preferred Securities | Convertible Notes Call Options | Delano Credit Facility | Delano Credit Facility | Delano Credit Facility | Delano Credit Facility | Delano Credit Facility | Delano Credit Sub-Facility | Convertible Notes | Convertible Notes | Convertible Notes | Convertible Notes | Convertible Notes | Nonrecourse Mortgage Notes Hudson/Delano 2014 Mortgage Loan | Mezzanine Loan Hudson/Delano 2014 Mortgage Loan | Hudson/Delano 2014 Mortgage Loan | Hudson/Delano 2014 Mortgage Loan | Hudson/Delano 2014 Mortgage Loan | Hudson/Delano 2014 Mortgage Loan | Hudson 2012 Mortgage Loan | Hudson 2012 Mortgage Loan | Hudson 2012 Mortgage Loan | Hudson 2012 Mortgage Loan | Clift Debt | Clift Debt | Clift Debt | Clift Debt | Clift Debt | Clift Debt | Trust Preferred Securities Subject to Mandatory Redemption | Trust Preferred Securities Subject to Mandatory Redemption | Yucaipal | Convertible Notes With Warrant Attached | Restaurant Lease Note | Restaurant Lease Note | Restaurant Lease Note | Restaurant Lease Note | Revolving Credit Facility | Revolving Credit Facility | ||||
Hudson Lease | Hudson Lease | Hudson Lease | Restaurant | TLG Promissory Notes | TLG Promissory Notes | TLG Promissory Notes | Long | Libor Rate | Libor Rate | Subsequent Event | Extension | Libor Rate | Interest Rate Caps | Libor Rate | Subsequent Event | Maximum | Minimum | Liability to Subsidiary Trust Issuing Preferred Securities | Libor Rate | Convert The Hotel To Delano Las Vegas | Convert The Hotel To Delano Las Vegas | Libor Rate | ||||||||||||||||||||||||||||||||||
Hotel | Base Rate | Liability to Subsidiary Trust Issuing Preferred Securities | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt And Capital Lease Obligations [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Date of first interest payment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 15-Apr-08 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Date of due debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | 30-Nov-15 | ' | ' | ' | ' | ' | ' | ' | 30-Oct-36 | ' | ' | ' | ' | ' | ' | ' | ' | 15-Oct-14 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt instrument, face value | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $15,000,000 | ' | ' | ' | ' | ' | ' | $150,000,000 | $450,000,000 | ' | ' | ' | $180,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $10,600,000 | ' | ' | ' |
Mortgage instrument, principal amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 300,000,000 | ' | ' | ' | 300,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt repayment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 37,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 180,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revolving credit facility, maximum amount of commitments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Letter of credit outstanding | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt & capital lease obligations, interest rate description | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '30-day LIBOR plus 565 basis points | ' | ' | ' | ' | ' | '30-day LIBOR rate | ' | ' | ' | ' | ' | ' | ' | 'three-month LIBOR rate | ' | ' | ' | ' | ' | ' | ' | ' |
Debt & capital lease obligations minimum Interest | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.00% | 3.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5.65% | ' | ' | ' | 8.40% | ' | ' | ' | ' | ' | ' | ' | 3.25% | ' | ' | ' | ' | ' | ' | ' | 4.00% |
LIBOR cap rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.75% | ' | ' | ' | ' | 2.50% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Hudson/Delano 2014 Mortgage Loan matures | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 9-Feb-16 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of extension options | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maturity period extension | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '1 year | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Extended Hudson/Delano 2014 Mortgage Loan maturity date | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 9-Feb-19 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Requirement for Extension in Maturity Date | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.25% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Prepayment premium after August 9, 2015 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Start date to repay debt without prepayment premium | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 9-Aug-15 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
LIBOR floor rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.50% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Sale of subsidiary company | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 71,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Leased term | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '99-year lease term | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Capital leased payment require | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6,000,000 | ' | 7,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increase in rent in future period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '5 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increase in consumer price index | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 40.00% | 20.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increase in consumer price index | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 20.00% | 10.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Morgans Group agreed to guarantee losses | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred securities issued | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount of common stock owned by the company through trust | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Proceeds used to purchase of junior subordinated notes issued | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Trust notes and preferred notes interest rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8.68% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Trust notes and preferred notes Interest rate Period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '2016-10 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Convertible debt, face amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 172,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net proceeds from offering | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 166,800,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.38% | ' | 2.38% | ' | ' | ' | ' | 5.80% | ' | ' | ' | ' | ' | ' | ' | 9.60% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Convertible Notes allowed to be purchased by investors | ' | ' | 88,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 88,000,000 | ' | ' | ' | ' | ' | ' | ' |
Convertible notes repurchased | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 35,400,000 | ' | ' | 49,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Discount on convertible notes repurchased | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Equity component recorded as additional paid-in-capital | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 9,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net of deferred taxes | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6,400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Convertible notes warrants, shares | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6,415,327 | ' | ' | ' | ' | ' | ' |
Exercise price of warrants or rights | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $40 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Purchase of the call options, net of the related tax benefit | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 20,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ownership interest in the light group | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 90.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Price per share of common stock to convert notes into shares | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $9.50 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt and capital lease obligations | 673,638,000 | 560,751,000 | ' | ' | ' | ' | ' | ' | ' | ' | 18,000,000 | ' | ' | ' | 16,000,000 | 2,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 49,015,000 | 170,698,000 | ' | ' | ' | ' | ' | 450,000,000 | ' | ' | ' | ' | ' | ' | ' | 93,396,000 | 91,486,000 | ' | ' | ' | ' | ' | ' | ' | 5,926,000 | 6,551,000 | ' | ' | 37,000,000 | ' |
Purchase price acquisition cash paid | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 28,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Non-Morgans EBITDA | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 18,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Fair value of TLG Promissory Notes | 18,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accrued interest | 1,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest rate increases (max) | ' | ' | ' | ' | ' | ' | ' | ' | ' | 18.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of accrued interest payable quarterly in cash | ' | ' | ' | ' | ' | ' | ' | ' | ' | 75.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of accrued interest payable on maturity | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Initial conversion price of common stock | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $9.50 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Initial date a lawsuit was filed against the Company related to TLG Promissory Notes | 'August 5, 2013 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of leasehold interests acquired in restaurants | ' | ' | ' | ' | ' | ' | ' | ' | 3 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Contractual obligation | ' | ' | ' | ' | ' | ' | ' | ' | 15,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restaurant leasehold note term | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '7 years | ' | ' | ' |
Fair value of restaurant lease notes | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 7,500,000 | 5,900,000 | ' | ' |
Number of Condominium Unit Leased | ' | ' | ' | ' | ' | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Annual minimum lease payments | ' | ' | ' | ' | ' | ' | 649,728 | 365,490 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Lease expiration date | ' | ' | ' | ' | ' | ' | '2096-11 | '2098-12 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Date after which company could purchase leased asset at fair market value | ' | ' | ' | ' | ' | ' | '2015-11 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Imputed interest rate of leased | ' | ' | ' | ' | ' | ' | 8.00% | 8.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Capital lease obligation | ' | ' | ' | $6,100,000 | $6,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revolving credit facility, initiation date | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 28-Jul-11 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Delano credit facility unused commitment fee | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.50% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Organization_and_Formation_Tra2
Organization and Formation Transaction - Additional Information (Detail) (USD $) | 9 Months Ended | 0 Months Ended | 9 Months Ended | 9 Months Ended | ||||||||||||||
Sep. 30, 2014 | Sep. 30, 2013 | Nov. 30, 2011 | Sep. 30, 2014 | Nov. 30, 2011 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Nov. 30, 2011 | Sep. 30, 2014 | Sep. 30, 2014 | Nov. 30, 2011 | |
Segment | 1-Dec-14 | The Light Group LLC | The Light Group LLC | International Locations | International Locations | Las Vegas | Mgm Resorts International | Yucaipal | Subsidiaries | Morgans Group | Mr. Sasson | Mr. Sasson | Mr. Sasson | Mr. Masi | Mr. Masi | |||
Sales | Sales | The Light Group LLC | The Light Group LLC | The Light Group LLC | The Light Group LLC | The Light Group LLC | ||||||||||||
Location | Location | Location | Location | |||||||||||||||
Organization and Formation Transaction [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Membership units exchangeable for common stock | 75,446 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,000,000 | ' | ' | ' | ' | ' |
Number of reportable operating segments | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of revenues | ' | ' | ' | ' | ' | ' | 5.50% | 10.50% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gain on transfer of food and beverage venue | $280,000 | $0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ownership interest acquired | ' | ' | ' | ' | 90.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Aggregate purchase price | ' | ' | ' | ' | 28,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Promissory notes issued to acquire business | ' | ' | ' | ' | 18,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 16,000,000 | ' | ' | 2,000,000 |
Notes convertible into shares of common stock | ' | ' | ' | ' | $9.50 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Beneficially own | ' | ' | ' | ' | 10.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5.00% | ' | ' |
Long term debt extended percentage bearing fixed interest percentage rate | ' | ' | 8.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increasing interest percentage rate | ' | ' | ' | 18.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of venues | ' | ' | ' | ' | ' | ' | ' | ' | 18 | 13 | 2 | 3 | ' | ' | ' | ' | ' | ' |
Employment contract expiration date | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 31-Dec-14 | ' |
Termination of restaurant management agreement | ' | ' | ' | ' | ' | 1-Apr-14 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Acquisition agreed to purchase of equity interest | ' | ' | ' | ' | 90.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of equity issue to noncontrolling interest | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5.00% | ' | ' | 5.00% | ' |
Obligation related to Sasson-Masi Put Option | $4,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Hotels_Detail
Hotels (Detail) | Sep. 30, 2014 |
Room | |
Hudson | New York, NY | ' |
Entity Hotels Disclosure [Line Items] | ' |
Number of Rooms | 876 |
Morgans | New York, NY | ' |
Entity Hotels Disclosure [Line Items] | ' |
Number of Rooms | 117 |
Royalton | New York, NY | ' |
Entity Hotels Disclosure [Line Items] | ' |
Number of Rooms | 168 |
Mondrian SoHo | New York, NY | ' |
Entity Hotels Disclosure [Line Items] | ' |
Number of Rooms | 263 |
Delano South Beach | Miami Beach, FL | ' |
Entity Hotels Disclosure [Line Items] | ' |
Number of Rooms | 194 |
Mondrian South Beach | Miami Beach, FL | ' |
Entity Hotels Disclosure [Line Items] | ' |
Number of Rooms | 214 |
Shore Club | Miami Beach, FL | ' |
Entity Hotels Disclosure [Line Items] | ' |
Number of Rooms | 308 |
Mondrian Los Angeles | Los Angeles, CA | ' |
Entity Hotels Disclosure [Line Items] | ' |
Number of Rooms | 236 |
Clift | San Francisco, CA | ' |
Entity Hotels Disclosure [Line Items] | ' |
Number of Rooms | 372 |
Sanderson | London, England | ' |
Entity Hotels Disclosure [Line Items] | ' |
Number of Rooms | 150 |
St Martins Lane | London, England | ' |
Entity Hotels Disclosure [Line Items] | ' |
Number of Rooms | 204 |
Mondrian London at Sea Containers | London, England | ' |
Entity Hotels Disclosure [Line Items] | ' |
Number of Rooms | 359 |
Delano Las Vegas | Las Vegas, Nevada | ' |
Entity Hotels Disclosure [Line Items] | ' |
Number of Rooms | 1,117 |
Hotels_Parenthetical_Detail
Hotels (Parenthetical) (Detail) | 9 Months Ended |
Sep. 30, 2014 | |
Hotel | |
Entity Hotels Disclosure [Line Items] | ' |
Ownership interest owned | 100.00% |
Mondrian South Beach | ' |
Entity Hotels Disclosure [Line Items] | ' |
Number of hotel residences sold | 261 |
Number of rented hotel residence | 140 |
Number of hotel residences remain to be sold | 74 |
Hudson | ' |
Entity Hotels Disclosure [Line Items] | ' |
Percentage of square footage of building owned | 96.00% |
Number of Rooms | 876 |
Number of SROs | 60 |
Mondrian SoHo | ' |
Entity Hotels Disclosure [Line Items] | ' |
Ownership interest owned | 20.00% |
Shore Club | ' |
Entity Hotels Disclosure [Line Items] | ' |
Ownership interest owned | 7.00% |
Summary_of_Significant_Account2
Summary of Significant Accounting Policies - Additional Information (Detail) (USD $) | 1 Months Ended | 9 Months Ended | 9 Months Ended | 1 Months Ended | |||||||||
Aug. 31, 2012 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Oct. 31, 2007 | Oct. 17, 2007 | Aug. 31, 2012 | Aug. 31, 2012 | Sep. 30, 2014 | Sep. 30, 2014 | |
Interest Rate Caps | Yucaipa Warrants | Convertible Notes | Convertible Notes | Convertible Notes | Convert The Hotel To Delano Las Vegas | Convert The Hotel To Delano Las Vegas | Convert The Hotel To Delano Las Vegas | Unconsolidated Joint Venture | |||||
Derivative | Restaurant | Restaurant Lease Note | Restaurant Lease Note | ||||||||||
Agreement | |||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of hotels' revenues in restricted escrow accounts | ' | 4.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Investment balance in unconsolidated joint venture | ' | $10,492,000 | ' | $10,492,000 | ' | ' | ' | ' | ' | ' | ' | ' | $0 |
Investments in unconsolidated joint ventures, liabilities | ' | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Term of license agreement | '10 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Extension of license agreement | ' | ' | ' | ' | ' | ' | ' | ' | ' | '5 years | ' | ' | ' |
Number of times license agreement period to be extended | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' | ' |
Company acquired the leasehold interest in number of food and beverage venues | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3 | ' | ' | ' |
Contractual obligation | ' | ' | ' | ' | ' | ' | ' | ' | ' | 15,000,000 | ' | ' | ' |
Deferred promissory note payable | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10,600,000 | ' | ' |
Restaurant lease note term | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '7 years | ' | ' |
Fair value of restaurant lease note | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 7,500,000 | 5,900,000 | ' |
Operating lease expiration period | '10 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Finite lived intangible assets useful life | ' | ' | ' | ' | ' | ' | ' | ' | ' | '10 years | ' | ' | ' |
Interest rate | ' | ' | ' | ' | ' | ' | 2.38% | ' | 2.38% | ' | ' | ' | ' |
Right to purchase common stock through the exercise of warrants | ' | ' | ' | ' | ' | 12,500,000 | ' | ' | ' | ' | ' | ' | ' |
Exercise price of warrants or rights | ' | ' | ' | ' | ' | $6 | ' | $40 | ' | ' | ' | ' | ' |
Investors consent rights warrants | ' | ' | ' | ' | ' | 6,250,000 | ' | ' | ' | ' | ' | ' | ' |
Fair value of interest rate caps | ' | 0 | -42,000 | ' | 200,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Number of interest rate caps outstanding | ' | ' | ' | ' | 3 | ' | ' | ' | ' | ' | ' | ' | ' |
Interest rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10.00% | ' |
Fixed rate debt | ' | 123,100,000 | ' | 247,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Fair market value of fixed rate debt | ' | 136,000,000 | ' | 217,700,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Membership units in noncontrolling interest | ' | $392,000 | ' | $490,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Membership units in Morgans Group outstanding | ' | 75,446 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Income_Loss_Per_Share_Addition
Income (Loss) Per Share - Additional Information (Detail) | 9 Months Ended |
Sep. 30, 2014 | |
Earnings Per Share [Abstract] | ' |
Assumption of net income distributed as dividends for calculation of net income per share | 100.00% |
Securities excluded from diluted net income (loss) per common share calculation | 75,446 |
Components_of_Basic_and_Dilute
Components of Basic and Diluted Loss Per Share Calculations (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Numerator: | ' | ' | ' | ' |
Net loss | ($10,095) | ($10,328) | ($43,493) | ($38,051) |
Net (income) loss attributable to noncontrolling interest | -48 | ' | -504 | 298 |
Net loss attributable to Morgans Hotel Group | -10,143 | -10,328 | -43,997 | -37,753 |
Less: preferred stock dividends and accretion | 3,594 | 4,037 | 11,948 | 9,976 |
Net loss attributable to common stockholders | ($13,737) | ($14,365) | ($55,945) | ($47,729) |
Denominator, continuing and discontinued operations: | ' | ' | ' | ' |
Weighted average basic common shares outstanding | 34,267 | 32,693 | 34,047 | 32,590 |
Effect of dilutive securities | 0 | 0 | 0 | 0 |
Weighted average diluted common shares outstanding | 34,267 | 32,693 | 34,047 | 32,590 |
Basic and diluted loss available to common stockholders per common share | ($0.40) | ($0.44) | ($1.64) | ($1.46) |
Investments_in_and_Advances_to2
Investments in and Advances to Unconsolidated Joint Ventures and Equity Losses (Detail) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Schedule of Equity Method Investments [Line Items] | ' | ' |
Total investments in and advances to unconsolidated joint ventures | $10,492 | $10,492 |
Mondrian Istanbul | ' | ' |
Schedule of Equity Method Investments [Line Items] | ' | ' |
Total investments in and advances to unconsolidated joint ventures | 10,392 | 10,392 |
Other | ' | ' |
Schedule of Equity Method Investments [Line Items] | ' | ' |
Total investments in and advances to unconsolidated joint ventures | $100 | $100 |
Equity_in_Income_Losses_from_U
Equity in Income (Losses) from Unconsolidated Joint Ventures (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Schedule of Equity Method Investments [Line Items] | ' | ' | ' | ' |
Equity in income (losses) from unconsolidated joint ventures | $3 | ($278) | $7 | ($773) |
Mondrian South Beach Food and Beverage-MC South Beach | ' | ' | ' | ' |
Schedule of Equity Method Investments [Line Items] | ' | ' | ' | ' |
Equity in income (losses) from unconsolidated joint ventures | ' | -281 | ' | -629 |
Other | ' | ' | ' | ' |
Schedule of Equity Method Investments [Line Items] | ' | ' | ' | ' |
Equity in income (losses) from unconsolidated joint ventures | $3 | $3 | $7 | ($144) |
Investments_in_and_Advances_to3
Investments in and Advances to Unconsolidated Joint Ventures - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | 3 Months Ended | 1 Months Ended | 9 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | 1 Months Ended | 1 Months Ended | 0 Months Ended | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | 0 Months Ended | 9 Months Ended | 1 Months Ended | ||||||||||||||||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Sep. 30, 2014 | Jun. 20, 2011 | Mar. 31, 2014 | Apr. 30, 2010 | Aug. 31, 2008 | Sep. 30, 2014 | Aug. 31, 2006 | Sep. 30, 2014 | Aug. 31, 2008 | Aug. 31, 2006 | Apr. 30, 2010 | Sep. 30, 2014 | Apr. 30, 2010 | Feb. 28, 2011 | Jun. 30, 2007 | Aug. 18, 2014 | Jun. 30, 2007 | Sep. 30, 2014 | Sep. 30, 2013 | Jun. 30, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Jun. 17, 2008 | Jun. 17, 2008 | Sep. 30, 2014 | Jan. 31, 2012 | Dec. 31, 2011 | Sep. 30, 2014 | Dec. 31, 2013 | |
Former Food And Beverage Joint Venture Entities | Former Food And Beverage Joint Venture Entities | Mondrian South Beach | Mondrian South Beach | Mondrian South Beach | Mondrian South Beach | Mondrian South Beach | Mondrian South Beach | Mondrian South Beach | Mondrian South Beach | Mondrian South Beach | Mondrian South Beach | Mondrian South Beach | Mondrian SoHo | Mondrian SoHo | Mondrian SoHo | Mondrian SoHo | Mondrian SoHo | Ames | Ames | Ames | Ames | Ames | Ames | Ames | Mondrian Istanbul | Mondrian Istanbul | Mondrian Istanbul | Mondrian Istanbul | ||||||
Joint Venture | Joint Venture | Joint Venture | Joint Venture | Joint Venture | Joint Venture | Joint Venture | Joint Venture Partners | Joint Venture Partners | Joint Venture Partners | OptionPlan | Joint Venture | Joint Venture | Joint Venture | Joint Venture | Joint Venture | Room | ||||||||||||||||||
Hotel | Mezzanine Loan | Libor Rate | Libor Rate | Mezzanine Loan | Room | |||||||||||||||||||||||||||||
Schedule of Equity Method Investments [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Equity ownership | ' | ' | ' | ' | ' | ' | 75.00% | ' | ' | ' | ' | 50.00% | ' | ' | ' | ' | ' | ' | ' | 20.00% | ' | ' | ' | ' | ' | ' | ' | 31.00% | ' | ' | ' | ' | 20.00% | ' |
Gross purchase price acquired building and land in joint venture | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $110,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Equity investment requirements and funds | ' | ' | ' | ' | ' | ' | ' | ' | 15,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10,300,000 | 10,300,000 | ' | ' |
Additional contribution to equity from joint venture partners | ' | ' | ' | ' | ' | ' | ' | ' | 8,000,000 | ' | ' | ' | ' | ' | ' | 2,750,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Proceeds of financing from lender and affiliates | ' | ' | ' | ' | ' | ' | ' | ' | ' | 22,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Basis Spread on Variable Rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6.00% | 3.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | 28,000,000 | ' | 124,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Seller financing to qualified condominium buyers, maximum condominium purchase price, percentage | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 80.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Mezzanine financing provided to joint venture | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 28,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Non recourse financing extension period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '7 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Extended maturity date of nonrecourse financing date | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '2017 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Extended maturity date of nonrecourse financing options | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '1 year | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Waterfall proceeds to joint venture mezzanine lender after repayment of mortgage debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Option to extend the outstanding mortgage and mezzanine debt | ' | ' | ' | ' | ' | ' | ' | '2015-04 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Outstanding nonrecourse mortgage loan and mezzanine loan | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 24,100,000 | ' | 28,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Outstanding mezzanine debt owed to affiliates | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 28,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of hotel residences sold | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 261 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of rented hotel residence | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 140 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of hotel residences remain to be sold | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 74 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Investments in and advances to unconsolidated joint ventures | 10,492,000 | ' | 10,492,000 | ' | 10,492,000 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10,392,000 | 10,392,000 |
Advances to joint venture | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 14,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Contribution in the joint venture | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5,000,000 | ' | ' | ' | ' | ' | ' | ' | 12,100,000 | ' | ' | ' | ' | ' | ' |
Number of guest rooms | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 263 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 122 | ' | ' |
Initial Management Contract Period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '10 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of extension option | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Proceed from loan borrowings | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 195,200,000 | ' | ' | ' | ' | ' | ' | 46,500,000 | ' | ' | ' | ' | ' |
Outstanding mortgage debt secured by hotel | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 196,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Deferred interest | ' | ' | 1,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 20,800,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Court determined property value | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 250,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Daily interest accrual | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 84,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest In Default | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 33,400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Equity method investment maturity date of secured mortgage debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 9-Oct-12 | ' | ' | ' | ' |
Agreement termination date | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 17-Jul-13 | ' | ' | ' | ' | ' | ' | ' | ' |
Management fee-related parties and other income | $5,259,000 | $6,956,000 | $16,509,000 | $21,220,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $900,000 | $900,000 | ' | $1,800,000 | ' | ' | ' | ' | ' | ' | ' |
Other_Liabilities_Detail
Other Liabilities (Detail) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Other Liabilities Disclosure [Abstract] | ' | ' |
Designer fee claim | $13,866 | $13,866 |
OPP LTIP Units Liability (note 8) | ' | 25 |
Other Liabilities | $13,866 | $13,891 |
Other_Liabilities_Additional_I
Other Liabilities - Additional Information (Detail) | 9 Months Ended |
Sep. 30, 2014 | |
Other Liabilities Disclosure [Abstract] | ' |
Base fee due designer | 1.00% |
Base fee payable for period from hotel opening | '10 years |
Amortization expense over estimated life | '5 years |
Debt_and_Capital_Lease_Obligat3
Debt and Capital Lease Obligations (Detail) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Oct. 17, 2007 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | Hudson/Delano 2014 Mortgage Loan | Notes Secured by Hudson | Clift Debt | Clift Debt | Liability to Subsidiary Trust Issuing Preferred Securities | Liability to Subsidiary Trust Issuing Preferred Securities | Convertible Notes | Convertible Notes | Convertible Notes | Debt of TLG Promissory Notes | Debt of TLG Promissory Notes | Restaurant Lease Note | Restaurant Lease Note | Capital Lease Obligations | Capital Lease Obligations | Revolving Credit Facility | ||
Debt And Capital Lease Obligations [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt and capital lease obligation | $673,638 | $560,751 | $450,000 | $180,000 | $93,396 | $91,486 | $50,100 | $50,100 | $49,015 | $170,698 | ' | $19,096 | $18,807 | $5,926 | $6,551 | $6,105 | $6,109 | $37,000 |
Interest rate, description | ' | ' | '5.80% (LIBOR + 5.65%) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest rate | ' | ' | 5.80% | ' | 9.60% | ' | 8.68% | ' | 2.38% | ' | 2.38% | ' | ' | ' | ' | ' | ' | ' |
Hotel_Commitments_and_Guarante
Hotel Commitments and Guarantees (Detail) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Commitments and Contingencies [Line Items] | ' | ' |
Key money, equity investment and debt financing commitments | $15,514 | $22,499 |
Cash flow guarantees | 5,000 | 13,000 |
Total maximum future funding commitments | 28,514 | 53,499 |
Amounts due within one year | 15,514 | 25,499 |
Mondrian Baha Mar | ' | ' |
Commitments and Contingencies [Line Items] | ' | ' |
Key money commitments related to terminated project | ' | 10,000 |
Delano Marrakech | Performance Guarantee | ' | ' |
Commitments and Contingencies [Line Items] | ' | ' |
Cash flow guarantees | $8,000 | $8,000 |
Hotel_Commitments_and_Guarante1
Hotel Commitments and Guarantees (Parenthetical) (Detail) | Sep. 30, 2014 | Dec. 31, 2013 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2014 |
USD ($) | USD ($) | Mondrian Baha Mar | Delano Marrakech | Delano Marrakech | Mondrian London | Mondrian London | |
USD ($) | Performance Guarantee | Performance Guarantee | USD ($) | GBP (£) | |||
USD ($) | USD ($) | ||||||
Commitments and Contingencies [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Equity or debt financing commitments | $0 | $0 | ' | ' | ' | ' | ' |
Key money | ' | ' | 10,000,000 | ' | ' | 15,300,000 | 9,400,000 |
Cash flow guarantees | $5,000,000 | $13,000,000 | ' | $8,000,000 | $8,000,000 | ' | ' |
Commitments_and_Contingencies_1
Commitments and Contingencies - Additional Information (Detail) | 0 Months Ended | 9 Months Ended | 0 Months Ended | 9 Months Ended | 0 Months Ended | 0 Months Ended | 9 Months Ended | 9 Months Ended | 0 Months Ended | 9 Months Ended | 0 Months Ended | 9 Months Ended | ||||||||||||||||
Mar. 20, 2014 | Sep. 30, 2014 | Dec. 31, 2013 | Jul. 23, 2014 | Sep. 30, 2014 | Aug. 05, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Jan. 16, 2013 | Jan. 16, 2013 | Jan. 16, 2013 | Apr. 26, 2013 | Sep. 30, 2014 | Jun. 17, 2008 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Oct. 10, 2014 | Sep. 30, 2014 | Sep. 30, 2012 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Aug. 18, 2014 | Sep. 30, 2014 | |
Defendant | USD ($) | USD ($) | OTK Associates [Member] | Yucaipal | Debt of TLG Promissory Notes | Mr. Sasson | Mr. Masi | Litigation | Litigation | Litigation | Ames Joint Venture | Ames | Ames | Royalton and Morgans | Joint Venture | Mondrian London | Mondrian London | Mondrian London | Delano Moscow | Delano Marrakech | Delano Marrakech | 10 Karakoy, a Morgans Original, Istanbul | Mondrian South Beach | Mondrian South Beach | Mondrian SoHo Hotel | Mondrian SoHo Hotel | Ames Hotel | |
USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | Sochin Downtown Realty, LLC | Cape Advisors Inc. | Morgans Group LLC | USD ($) | USD ($) | Ames | USD ($) | GBP (£) | Subsequent Event | USD ($) | Room | USD ($) | USD ($) | USD ($) | Construction Contracts | Joint Venture | Owned, Joint Venture and Managed Hotels | |||||||
USD ($) | USD ($) | Room | USD ($) | USD ($) | USD ($) | |||||||||||||||||||||||
Commitment And Contingencies [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Key money | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $15,300,000 | £ 9,400,000 | $15,200,000 | $3,000,000 | ' | ' | $300,000 | ' | ' | ' | ' | ' |
Value added tax paid, expects to recover from the taxing authority | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Key money obligation, relieved | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10,000,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Relieved amount of cash flow guarantee | ' | 5,000,000 | 13,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8,000,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Rooms in Delano Marrakech hotel | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 71 | ' | ' | ' | ' | ' | ' | ' |
Expected Room Count | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 71 | ' | ' | ' | ' | ' |
Anticipated Opening | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '2014 | ' | ' | ' | ' | ' |
Accrued expenses and reduction to management fees | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 700,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Payables outstanding to vendors | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 300,000 | ' | ' | ' |
Purchase of condominium units by the Company and its Affiliates | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 14,000,000 | ' | ' | ' | ' |
Condominium units sales price description | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 'The joint venture partners are each obligated to purchase selected condominium units, at agreed-upon sales prices, having aggregate sales prices equal to 1/2 of the lesser of $28.0 million, which is the face amount outstanding on the lender’s mezzanine loan, or the then outstanding principal balance of the lender’s mezzanine loan. | ' | ' | ' | ' |
Commitments guarantee obligations percentage | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 20.00% | ' | ' |
Management agreement termination period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '60 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Agreement termination fee | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,800,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Tax credit guaranties capped | ' | 3,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Proceeds from sale of tax credits | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 16,900,000 |
Management agreement termination date | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 17-Jul-13 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Defaulted outstanding on loans | ' | ' | ' | ' | ' | 18,000,000 | ' | ' | 217,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Date of due debt | ' | ' | ' | ' | ' | ' | ' | ' | 15-Nov-12 | ' | ' | ' | ' | ' | ' | 9-Oct-12 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ownership interest acquired | ' | ' | ' | ' | ' | ' | ' | ' | ' | 80.00% | 20.00% | ' | ' | 31.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of defendants | 4 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Court determined property value | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 250,500,000 | ' |
Daily interest accrual | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 84,000 | ' |
Claim for losses and damages | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 30,000,000 | ' | ' | ' | ' | ' | ' |
Counterclaim by the owner | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 119,000,000 | ' | ' | ' | ' | ' | ' |
Complaint seeks damages, amount | ' | ' | ' | ' | ' | ' | 16,000,000 | 2,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cost paid were not covered by insurance proceed | ' | 400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Securities action amount | ' | ' | ' | ' | 3,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Aggregate amount awarded | ' | ' | ' | 6,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Prior interim award amount paid by Company's insurers | ' | ' | ' | $2,700,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
License_or_Franchise_Agreement
License or Franchise Agreements for New Hotels Which are in Development Stage (Detail) | 9 Months Ended |
Sep. 30, 2014 | |
Room | |
10 Karakoy, a Morgans Original, Istanbul | ' |
Development Hotel Agreements [Line Items] | ' |
Expected Room Count | 71 |
Anticipated Opening | '2014 |
Initial Term | '15 years |
Mondrian Doha | ' |
Development Hotel Agreements [Line Items] | ' |
Expected Room Count | 270 |
Anticipated Opening | '2015 |
Initial Term | '30 years |
Mondrian Istanbul | ' |
Development Hotel Agreements [Line Items] | ' |
Expected Room Count | 122 |
Initial Term | '20 years |
Delano Aegean Sea | ' |
Development Hotel Agreements [Line Items] | ' |
Expected Room Count | 150 |
Initial Term | '20 years |
Delano Cartagena | ' |
Development Hotel Agreements [Line Items] | ' |
Expected Room Count | 211 |
Initial Term | '20 years |
Omnibus_Stock_Incentive_Plan_A
Omnibus Stock Incentive Plan - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | 9 Months Ended | 0 Months Ended | 9 Months Ended | ||||||
In Millions, except Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Mar. 18, 2011 | Dec. 31, 2007 | Sep. 30, 2014 | Sep. 30, 2014 | Aug. 14, 2014 | Mar. 20, 2011 | Sep. 30, 2014 |
Stock Incentive Plan 2006 | Stock Incentive Plan 2006 | Restricted Stock Units | Restricted Stock Units | OPP LTIP Units | OPP LTIP Units | |||||||
Non-Employee Directors | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock reserved and authorized | ' | ' | ' | ' | ' | ' | ' | 14,610,000 | ' | ' | ' | ' |
Reduction in shares available for grant due to each award other than options and stock appreciation rights | ' | ' | ' | ' | ' | ' | 1.7 | ' | ' | ' | ' | ' |
Restricted stock units issued | ' | ' | ' | ' | ' | ' | ' | ' | 271,701 | 77,922 | ' | ' |
Vesting, description | ' | ' | ' | ' | ' | ' | ' | ' | ' | 'These grants become 100% vested on May 14, 2015, provided that upon a non-employee director’s resignation from the Board of Directors, other than as a consequence of the director’s bad acts, the vesting of any RSUs will be on a pro rated basis as of the resignation date. | ' | ' |
Vesting Percentage on Vesting Date | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100.00% | ' | ' |
Vesting Date | ' | ' | ' | ' | ' | ' | ' | ' | ' | 14-May-15 | ' | ' |
Stock compensation expense | $0.30 | $1.30 | $3.10 | $3.60 | ' | ' | ' | ' | ' | ' | ' | ' |
Unrecognized compensation costs | $1.80 | ' | $1.80 | ' | $3.40 | ' | ' | ' | ' | ' | ' | ' |
Weighted-average period over unrecognized compensation expense | ' | ' | '1 year 1 month 6 days | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash or equity award period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '3 years | ' |
Increase in company's total return to stockholders | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 30.00% | ' |
Compounded annual growth rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 9.00% | ' |
Increase in company's total return to stockholders over | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 'Three-year period from March 20, 2011 to March 20, 2014 |
Closing price of Company's common shares | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '30 days |
Fair value of LTIP unit at grant date | ' | ' | ' | ' | ' | $8.87 | ' | ' | ' | ' | ' | ' |
Performance criteria | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $11.53 |
Summary_of_Stockbased_Incentiv
Summary of Stock-based Incentive Awards (Detail) | 9 Months Ended |
Sep. 30, 2014 | |
Restricted Stock Units | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Outstanding as of January 1, 2014 | 888,461 |
Restricted stock units issued | 271,701 |
Distributed/exercised during 2014 | -710,939 |
Forfeited during 2014 | -101,756 |
Outstanding as of September 30, 2014 | 347,467 |
LTIP Units | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Outstanding as of January 1, 2014 | 1,134,610 |
Distributed/exercised during 2014 | -193,453 |
Outstanding as of September 30, 2014 | 941,157 |
Vested as of September 30, 2014 | 941,157 |
Stock Options | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Outstanding as of January 1, 2014 | 1,424,740 |
Forfeited during 2014 | -300,000 |
Outstanding as of September 30, 2014 | 1,124,740 |
Vested as of September 30, 2014 | 1,124,740 |
Preferred_Securities_and_Warra1
Preferred Securities and Warrants - Additional Information (Detail) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | Jul. 21, 2010 | Oct. 15, 2009 | Sep. 30, 2014 | 14-May-14 | Dec. 31, 2009 | Oct. 15, 2009 | Sep. 30, 2014 | Feb. 28, 2014 | 14-May-14 | Sep. 30, 2014 |
In Millions, except Share data, unless otherwise specified | Series A Preferred Stock | Series A Preferred Stock | Series A Preferred Stock | Series A Preferred Stock | Yucaipal | Yucaipal | Yucaipal | Yucaipal | Yucaipal | |||
Person | Series A Preferred Stock | Series A Preferred Stock | ||||||||||
Preferred Securities And Warrants [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred Securities issued (in shares) | ' | ' | ' | 75,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred Securities issued, value | ' | ' | ' | $75 | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred Securities issued, liquidation preference | $1,000 | $1,000 | ' | $1,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Number of warrants issued | ' | ' | ' | ' | ' | ' | ' | 12,500,000 | ' | ' | ' | ' |
Exercise price of warrants or rights | ' | ' | ' | ' | ' | ' | ' | $6 | ' | ' | ' | ' |
Preferred stock Series A dividend rate through October 15, 2014 | ' | ' | ' | 8.00% | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred stock Series A dividend rate from October 15, 2014 to October 15, 2016 | ' | ' | ' | 10.00% | ' | ' | ' | ' | ' | ' | ' | ' |
Preferred stock Series A dividend rate After October 15, 2016 | ' | ' | ' | 20.00% | ' | ' | ' | ' | ' | ' | ' | ' |
Investors dividend rate on the Series A Preferred Securities increases | ' | ' | ' | 4.00% | ' | ' | ' | ' | ' | ' | ' | ' |
Investors dividend rate | ' | ' | ' | ' | ' | 12.00% | ' | ' | ' | ' | 8.00% | 10.00% |
Investors collectively own or right to purchase through exercise of shares | ' | ' | ' | ' | ' | ' | ' | ' | 875,000 | ' | ' | ' |
Undeclared and unpaid dividends | ' | ' | ' | ' | 40.4 | ' | ' | ' | ' | ' | ' | ' |
Investors consent rights warrants | ' | ' | ' | ' | ' | ' | ' | 6,250,000 | ' | ' | ' | ' |
Equity investment acquisition | ' | ' | ' | ' | ' | ' | ' | 100 | ' | ' | ' | ' |
Change in size of board of directors, lower range | ' | ' | ' | ' | ' | ' | ' | 7 | ' | ' | ' | ' |
Change in size of board of directors, upper range | ' | ' | ' | ' | ' | ' | ' | 9 | ' | ' | ' | ' |
Beneficial ownership interest in which investors are subject to certain standstill arrangements | ' | ' | ' | ' | ' | ' | ' | 15.00% | ' | ' | ' | ' |
Term of warrants | ' | ' | ' | ' | ' | ' | ' | '7 years 6 months | ' | ' | ' | ' |
Warrant, expiration date | ' | ' | ' | ' | ' | ' | ' | '2017-04 | ' | ' | ' | ' |
Expected dividend payments period used to compute fair value of preferred securities | ' | ' | ' | ' | ' | ' | '7 years | ' | ' | ' | ' | ' |
Discounted dividend payments expected | ' | ' | ' | ' | ' | ' | 17.30% | ' | ' | ' | ' | ' |
Cumulative accretion | ' | ' | ' | ' | 17.6 | ' | ' | ' | ' | ' | ' | ' |
Value of preferred securities | ' | ' | ' | ' | 65.7 | ' | ' | ' | ' | ' | ' | ' |
Convertible Notes allowed to be purchased by investors | ' | ' | 88 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Issuance of Convertible Notes | ' | ' | 88 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Convertible notes repurchased | ' | ' | ' | ' | ' | ' | ' | ' | ' | $88 | ' | ' |
Related_Party_Transactions_Add
Related Party Transactions - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | |
Related Party Transaction [Line Items] | ' | ' | ' | ' | ' |
Management fees | $1,000,000 | $2,400,000 | $3,400,000 | $7,200,000 | ' |
Related party receivables | 3,811,000 | ' | 3,811,000 | ' | 3,694,000 |
Interest expense related to TLG Promissory Notes | 300,000 | 400,000 | 1,100,000 | 1,100,000 | ' |
TLG Promissory Notes | ' | ' | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' | ' | ' |
TLG Promissory Notes to Messrs. Sasson and Masi | $19,100,000 | ' | $19,100,000 | ' | $18,800,000 |
Restructuring_and_Disposal_Cos
Restructuring and Disposal Costs (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Other Income And Expenses [Abstract] | ' | ' | ' | ' |
Restructuring costs | $1,113 | $939 | $4,208 | $6,121 |
Severance and related costs | 29 | 827 | 8,395 | 1,620 |
(Gain) loss on asset disposal and other costs | 3 | 33 | -234 | 210 |
Total | $1,145 | $1,799 | $12,369 | $7,951 |
Other_Expenses_Additional_Info
Other Expenses - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | 3 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Mar. 31, 2014 | Mar. 31, 2014 |
One-time Termination Benefits | One Time Termination Benefits To Executive Officers | |||||
Restructuring Cost and Reserve [Line Items] | ' | ' | ' | ' | ' | ' |
Severance and related costs | $29 | $827 | $8,395 | $1,620 | $7,100 | $1,800 |
Development_Costs_Detail
Development Costs (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Other Income And Expenses [Abstract] | ' | ' | ' | ' |
Transaction costs | $259 | $364 | $2,839 | $574 |
Internal development payroll and other | 298 | 386 | 647 | 1,056 |
Pre-opening expenses | 7 | 221 | 442 | 738 |
Total | $564 | $971 | $3,928 | $2,368 |
Deferred_Gain_on_Asset_Sales_A
Deferred Gain on Asset Sales - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | |||||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Dec. 31, 2011 | Dec. 31, 2011 |
Morgans Hotel Group Europe Ltd | London, Morgans, Royalton | ||||||
Deferred Revenue Arrangement [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Equity ownership | ' | ' | ' | ' | ' | 50.00% | ' |
Deferred gain on asset sales | $127,403 | ' | $127,403 | ' | $133,419 | ' | $152,400 |
Gain on asset sales | $2,005 | $2,005 | $6,015 | $6,015 | ' | ' | ' |