Apple REIT Ten 10-Q 6 May 16 2016 Q1 Quarterly report Financial data

Document And Entity Information

Document And Entity Information - shares	3 Months Ended
	Mar. 31, 2016	May. 01, 2016
Document and Entity Information [Abstract]
Entity Registrant Name	Apple REIT Ten, Inc.
Document Type	10-Q
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		87,563,704
Amendment Flag	false
Entity Central Index Key	1,498,864
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Filer Category	Non-accelerated Filer
Entity Well-known Seasoned Issuer	No
Document Period End Date	Mar. 31, 2016
Document Fiscal Year Focus	2,016
Document Fiscal Period Focus	Q1

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Assets
Investment in real estate, net of accumulated depreciation of $116,854 and $107,525, respectively	$ 930,649	$ 938,417
Restricted cash-furniture, fixtures and other escrows	13,205	13,412
Due from third party managers, net	12,824	7,329
Other assets, net	8,722	9,227
Total Assets	965,400	968,385
Liabilities
Revolving credit facility	44,700	30,400
Mortgage debt	195,843	196,887
Accounts payable and other liabilities	11,301	13,352
Total Liabilities	251,844	240,639
Shareholders' Equity
Preferred stock, value issued	0	0
Common stock, no par value, authorized 400,000,000 shares; issued and outstanding 88,202,564 and 88,785,416 shares, respectively	862,847	868,852
Distributions greater than net income	(149,339)	(141,154)
Total Shareholders' Equity	713,556	727,746
Total Liabilities and Shareholders' Equity	965,400	968,385
Series A Preferred Stock [Member]
Shareholders' Equity
Preferred stock, value issued	0	0
Series B Convertible Preferred Stock [Member]
Shareholders' Equity
Preferred stock, value issued	$ 48	$ 48

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parentheticals) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Real estate accumulated depreciation (in Dollars)	$ 116,854	$ 107,525
Preferred stock, shares authorized	30,000,000	30,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, shares authorized	400,000,000	400,000,000
Common stock, shares issued	88,202,564	88,785,416
Common stock, shares outstanding	88,202,564	88,785,416
Series A Preferred Stock [Member]
Preferred stock, shares authorized	400,000,000	400,000,000
Preferred stock, shares issued	88,202,564	88,785,416
Preferred stock, shares outstanding	88,202,564	88,785,416
Series B Convertible Preferred Stock [Member]
Preferred stock, shares authorized	480,000	480,000
Preferred stock, shares issued	480,000	480,000
Preferred stock, shares outstanding	480,000	480,000

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Revenues:
Room	$ 60,448	$ 55,737
Other	5,032	4,660
Total revenue	65,480	60,397
Expenses:
Operating	15,872	14,633
Hotel administrative	5,501	5,006
Sales and marketing	5,414	4,953
Utilities	2,003	2,103
Repair and maintenance	2,418	2,146
Franchise fees	2,808	2,680
Management fees	2,500	2,315
Property taxes, insurance and other	4,337	3,945
Ground lease	311	85
General and administrative	1,846	1,489
Transaction costs	282	1,580
Depreciation	9,329	8,389
Total expenses	52,621	49,324
Operating income	12,859	11,073
Interest and other expense, net	(2,756)	(1,684)
Income before income taxes	10,103	9,389
Income tax expense	(56)	(59)
Net income	$ 10,047	$ 9,330
Basic and diluted net income per common share (in Dollars per share)	$ 0.11	$ 0.10
Weighted average common shares outstanding - basic and diluted (in Shares)	88,324	90,702

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Cash flows from operating activities:
Net income	$ 10,047	$ 9,330
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation	9,329	8,389
Other non-cash expenses, net	140	55
Changes in operating assets and liabilities:
Increase in due from third party managers, net	(5,495)	(6,383)
Decrease in other assets, net	1,492	751
Decrease in accounts payable and other liabilities	(720)	(1,136)
Net cash provided by operating activities	14,793	11,006
Cash flows from investing activities:
Acquisition of hotel properties, net	0	(73,221)
Deposits and other disbursements for potential acquisitions	(150)	(100)
Capital improvements	(3,063)	(6,355)
Decrease (increase) in capital improvement reserves	(713)	351
Net cash used in investing activities	(3,926)	(79,325)
Cash flows from financing activities:
Redemptions of Units	(5,985)	(4,387)
Distributions paid to common shareholders	(18,232)	(18,718)
Net proceeds from credit facility	14,300	45,700
Payments of mortgage debt	(950)	(579)
Financing costs	0	(38)
Net cash provided by (used in) financing activities	(10,867)	21,978
Decrease in cash and cash equivalents	0	(46,341)
Cash and cash equivalents, beginning of period	0	46,341
Cash and cash equivalents, end of period	0	0
Supplemental cash flow information:
Interest paid	$ 2,861	$ 1,908

Organization and Summary of Sig

Organization and Summary of Significant Accounting Policies	3 Months Ended
	Mar. 31, 2016
Accounting Policies [Abstract]
Organization, Consolidation, Basis of Presentation, Business Description and Accounting Policies [Text Block]	1. Organization and Summary of Significant Accounting Policies Organization Apple REIT Ten, Inc., together with its wholly owned subsidiaries (the “Company”), is a Virginia corporation that has elected to be treated as a real estate investment trust (“REIT”) for federal income tax purposes. The Company was formed to invest in hotels and other income-producing real estate in selected metropolitan areas in the United States. Initial capitalization occurred on August 13, 2010, when 10 Units, each Unit consisting of one common share and one Series A preferred share, were purchased by Apple Ten Advisors, Inc. (“A10A”) and 480,000 Series B convertible preferred shares were purchased by Glade M. Knight, the Company’s Chairman and Chief Executive Officer. The Company began operations on March 4, 2011, when it purchased its first hotel. The Company concluded its best-efforts offering on July 31, 2014. The Company’s fiscal year end is December 31. The Company has no foreign operations or assets and its operating structure includes only one reportable segment. The consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany accounts and transactions have been eliminated. Although the Company has an interest in a potential variable interest entity through its purchase commitment, it is not the primary beneficiary as the Company does not have any elements of power in the decision making process of this entity, and therefore does not consolidate the entity. As of March 31, 2016, the Company owned 55 hotels located in 17 states with an aggregate of 7,056 rooms. Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in accordance with the rules and regulations for reporting on Form 10-Q. Accordingly, they do not include all of the information required by accounting principles generally accepted in the United States for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. These unaudited financial statements should be read in conjunction with the Company’s audited consolidated financial statements included in its 2015 Annual Report on Form 10-K. Operating results for the three months ended March 31, 2016 are not necessarily indicative of the results that may be expected for the twelve month period ending December 31, 2016. Use of Estimates The preparation of the financial statements in conformity with United States generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. Reclassifications Certain prior period amounts in the consolidated financial statements have been reclassified to conform to the current period presentation with no effect on previously reported net income, shareholders’ equity or cash flows. Net Income Per Common Share Basic net income per common share is computed based upon the weighted average number of shares outstanding during the period. Diluted net income per common share is calculated after giving effect to all potential common shares that were dilutive and outstanding for the period. There were no potential common shares with a dilutive effect for the three months ended March 31, 2016 and 2015. As a result, basic and diluted net income per common share were the same. Series B convertible preferred shares are not included in net income per common share calculations until such time that such shares are eligible to be converted to common shares.

Investment in Real Estate

Investment in Real Estate	3 Months Ended
	Mar. 31, 2016
Real Estate [Abstract]
Real Estate Disclosure [Text Block]	2. Investment in Real Estate The Company’s total investment in real estate consisted of the following (in thousands): March 31, December 31, 2016 2015 Land $ 89,823 $ 89,823 Building and Improvements 872,377 871,454 Furniture, Fixtures and Equipment 81,621 80,983 Franchise Fees 3,682 3,682 1,047,503 1,045,942 Less Accumulated Depreciation (116,854 ) (107,525 ) Investment in Real Estate, net $ 930,649 $ 938,417 The Company did not acquire any hotels during the three months ended March 31, 2016. As of March 31, 2016, the Company owned 55 hotels with an aggregate of 7,056 rooms, located in 17 states. As of March 31, 2016, the Company had an outstanding contract for the purchase of a 153-room Homewood Suites hotel under construction in Cape Canaveral, Florida for a purchase price of approximately $25.2 million. Construction of the hotel was completed and the hotel opened for business in April 2016. The Company closed on the purchase of the hotel on April 29, 2016. The Company used borrowings under its credit facility to purchase the hotel.

Credit Facility

Credit Facility	3 Months Ended
	Mar. 31, 2016
Debt Disclosure [Abstract]
Debt Disclosure [Text Block]	3. Credit Facility At March 31, 2016, the outstanding balance on the Company’s $100 million revolving credit facility was $44.7 million, increasing from $30.4 million outstanding at December 31, 2015. The annual interest rate at March 31, 2016 was approximately 2.29%. In April 2016, the credit agreement was amended to increase the amount of the facility to $150 million. The credit facility is utilized for acquisitions, hotel renovations, working capital and other general corporate funding purposes, including the funding of redemptions and the payment of distributions. Under the terms of the credit agreement, the Company may make voluntary prepayments in whole or in part, at any time. The maturity date is July 2017, the annual interest rate is equal to the one-month LIBOR (the London Inter-Bank Offered Rate for a one-month term) plus a margin ranging from 1.85% to 2.35%, depending upon the Company’s leverage ratio, as calculated under the terms of the credit agreement, and the annual unused facility fee is 0.20% or 0.30% on the average unused portion of the revolving credit facility, based on the amount of borrowings outstanding during each quarter. The Company has the right, upon satisfaction of certain conditions, including covenant compliance and payment of an extension fee, to extend the maturity date to July 2018. The credit facility contains customary affirmative covenants, negative covenants and events of default. In addition, the credit facility contains covenants restricting the level of certain investments and quarterly financial covenants which include, among others, a minimum net worth, maximum debt limits, minimum debt service and fixed charge coverage ratios, and maximum distribution limits. The Company was in compliance with each of the applicable covenants at March 31, 2016. Effective 2016, distributions are limited to 100% of Funds From Operations (as defined in the credit agreement).

Fair Value of Financial Instrum

Fair Value of Financial Instruments	3 Months Ended
	Mar. 31, 2016
Fair Value Disclosures [Abstract]
Fair Value Disclosures [Text Block]	4. Fair Value of Financial Instruments The Company estimates the fair value of its debt by discounting the future cash flows of each instrument at estimated market rates consistent with the maturity of a debt obligation with similar credit terms and credit characteristics, which are Level 3 inputs under the fair value hierarchy. Market rates take into consideration general market conditions and maturity. As of March 31, 2016, the carrying value and estimated fair value of the Company’s debt was $240.5 million and $238.4 million, respectively. As of December 31, 2015, the carrying value and estimated fair value of the Company’s debt was $227.3 million and $225.6 million, respectively. Both the carrying value and estimated fair value of the Company’s debt as discussed above is net of unamortized debt issuance costs related to mortgage debt for each respective year. The carrying value of the Company’s other financial instruments approximates fair value due to the short-term nature of these financial instruments.

Related Parties

Related Parties	3 Months Ended
	Mar. 31, 2016
Related Party Transactions [Abstract]
Related Party Transactions Disclosure [Text Block]	5. Related Parties The Company has, and is expected to continue to engage in, significant transactions with related parties. These transactions cannot be construed to be at arm’s length and the results of the Company’s operations may be different if these transactions were conducted with non-related parties. The Company’s independent members of the Board of Directors oversee and annually review the Company’s related party relationships (including the relationships discussed in this section) and are required to approve any significant modifications to existing relationships, as well as any new significant related party transactions. The Board of Directors is not required to approve each individual transaction that falls under the related party relationships. However, under the direction of the Board of Directors, at least one member of the Company’s senior management team approves each related party transaction. As of March 31, 2016, there have been no changes to the contracts and relationships discussed in the Company’s 2015 Annual Report on Form 10-K. Below is a summary of the related party relationships in effect and transactions that occurred during the three months ended March 31, 2016 and 2015. Also see Note 7 for a discussion of the potential merger with Apple Hospitality REIT, Inc. (“Apple Hospitality”). Glade M. Knight, the Company’s Chairman and Chief Executive Officer, is currently Executive Chairman of Apple Hospitality. Apple Realty Group, Inc., formerly known as Apple Suites Realty Group, Inc. (“ARG”), and A10A are wholly owned by Mr. Knight. Mr. Knight is also Chief Executive Officer and partner of Energy 11 GP, LLC, which is the general partner of Energy 11, L.P. Justin G. Knight, the Company’s President, also serves as President and Chief Executive Officer of Apple Hospitality and is a member of the Board of Directors of Apple Hospitality. The Company is externally managed and does not have any employees. ARG provides the Company with property acquisition and disposition services. Its advisor, A10A, provides the Company with its day-to-day management services. The Company pays fees and reimburses certain expenses to A10A and ARG for these services. A10A has subcontracted its obligations to Apple Hospitality, which provides to the Company the advisory services contemplated under the A10A advisory agreement (“Advisory Agreement”) and Apple Hospitality receives the fees and expense reimbursements payable under the Advisory Agreement from the Company. The subcontract agreement has no impact on the Company’s Advisory Agreement with A10A. ARG Agreement The Company has a contract with ARG to acquire and dispose of real estate assets for the Company. A fee of 2% of the gross purchase price or gross sale price in addition to certain reimbursable expenses is paid to ARG for these services. As of March 31, 2016, payments to ARG for fees under the terms of this contract have totaled approximately $19.9 million since inception. No fees were incurred during the three months ended March 31, 2016. The Company incurred fees of $1.5 million for the three months ended March 31, 2015, which is included in transaction costs in the Company’s consolidated statements of operations. A10A Agreement Under the Advisory Agreement, A10A provides management services to the Company. As discussed above, A10A subcontracts its obligations under this agreement to Apple Hospitality. An annual fee ranging from 0.1% to 0.25% of total equity proceeds received by the Company, in addition to certain reimbursable expenses as described below, is payable to Apple Hospitality for these management services. Total advisory fees incurred by the Company under the Advisory Agreement are included in general and administrative expenses and totaled approximately $0.6 million and $0.4 million for the three months ended March 31, 2016 and 2015, respectively. The increase in the first three months of 2016 was primarily due to the Company reaching the top fee tier under its advisory agreement in the second quarter of 2015 due to improved results of operations. Advisors Cost Sharing Structure In addition to the fees payable to ARG and A10A, the Company reimbursed to ARG or A10A, or paid directly to Apple Hospitality on behalf of ARG or A10A, approximately $0.8 million and $0.7 million for the three months ended March 31, 2016 and 2015, respectively. The costs are included in general and administrative expenses and are for the Company’s allocated share of the staffing and related costs provided by Apple Hospitality through its relationships with ARG and A10A. As of March 31, 2016 and December 31, 2015, total amounts due to Apple Hospitality for reimbursements under the cost sharing structure totaled approximately $0.1 million and $0.2 million, respectively, and are included in accounts payable and other liabilities in the Company’s consolidated balance sheets. As part of the cost sharing arrangements, certain day-to-day transactions may result in amounts due to or from Apple Hospitality. To efficiently manage cash disbursements, the Company, Apple Hospitality, ARG or A10A may make payments for any or all of the related companies. Under the cash management process, each of the companies may advance or defer up to $1 million at any time. Each month, any outstanding amounts are settled among the affected companies. This process allows each company to minimize its cash on hand, which, in turn, reduces the cost of each company’s credit facility. The amounts outstanding at any point in time are not significant to any of the companies. Apple Air Holding, LLC (“Apple Air”) Membership Interest Included in other assets, net on the Company’s consolidated balance sheet as of March 31, 2016 and December 31, 2015 is a 26% equity investment in Apple Air. As of March 31, 2016, the other member of Apple Air was Apple Hospitality, which owned a 74% interest. The Company’s equity investment was approximately $0.8 million and $0.6 million as of March 31, 2016 and December 31, 2015, respectively, and is included in other assets, net in the Company’s consolidated balance sheets. The Company has recorded its share of income and losses of the entity under the equity method of accounting and adjusted its investment in Apple Air accordingly. For the three months ended March 31, 2016 and 2015, the Company recorded a loss of approximately $0.1 million for each period as its share of the net loss of Apple Air, which primarily relates to the depreciation of the aircraft, and is included in general and administrative expense in the Company’s consolidated statements of operations. Through its equity investment, the Company has access to Apple Air’s aircraft primarily for acquisition, asset management and renovation purposes. Total costs paid for the usage of the aircraft was not significant during the reporting periods.

Shareholders' Equity

Shareholders' Equity	3 Months Ended
	Mar. 31, 2016
Stockholders' Equity Note [Abstract]
Stockholders' Equity Note Disclosure [Text Block]	6. Shareholders’ Equity Unit Redemption Program In April 2012, the Company instituted a Unit Redemption Program to provide limited interim liquidity to its shareholders who have held their Units for at least one year. Shareholders may request redemption of Units for a purchase price equal to 92.5% of the price paid per Unit if the Units have been owned for less than five years, or 100% of the price paid per Unit if the Units have been owned more than five years. The maximum number of Units that may be redeemed in any given year is three percent (3%) of the weighted average number of Units outstanding during the 12-month period immediately prior to the date of redemption. The Company reserves the right to change the purchase price of redemptions, reject any request for redemption, or otherwise amend the terms of, suspend, or terminate the Unit Redemption Program. As discussed in Note 7, in April 2016, the Company announced the suspension of its Unit Redemption Program effective after the planned April 2016 redemptions. Since the inception of the program through March 31, 2016, the Company has redeemed approximately 7.9 million Units in the amount of $80.4 million, including approximately 0.6 million Units in the amount of $6.0 million and 0.4 million Units in the amount of $4.4 million during the three months ended March 31, 2016 and 2015. The following is a summary of the Unit redemptions during 2015 and the first three months of 2016: Redemption Date Total Requested Unit Redemptions at Redemption Date Units Redeemed Total Redemption Requests Not Redeemed at Redemption Date First Quarter 2015 425,833 425,833 0 Second Quarter 2015 402,201 402,201 0 Third Quarter 2015 524,458 524,458 0 Fourth Quarter 2015 899,680 899,680 0 First Quarter 2016 582,852 582,852 0 Distributions The Company’s annual distribution rate as of March 31, 2016 was $0.825 per common share, payable monthly. For the three months ended March 31, 2016 and 2015, the Company made distributions of $0.20625 per common share for a total of $18.2 million and $18.7 million.

Subsequent Events

Subsequent Events	3 Months Ended
	Mar. 31, 2016
Subsequent Events [Abstract]
Subsequent Events [Text Block]	7. Subsequent Events In April 2016, the Company declared and paid approximately $6.1 million, or $0.06875 per outstanding common share, in distributions to its common shareholders. In April 2016, under the guidelines of the Company’s Unit Redemption Program, the Company redeemed approximately 0.6 million Units in the amount of $6.8 million, representing 39% of the requested Unit redemptions. Redemptions were made on a pro rata basis due to the 3% limitation discussed in Note 6. On April 13, 2016, the Company entered into a definitive merger agreement with Apple Hospitality, pursuant to which the Company would merge into a wholly-owned subsidiary of Apple Hospitality (the “Acquisition Sub”). Under the merger agreement, each outstanding Unit of the Company (other than those with respect to which statutory dissenters’ rights of appraisal have been properly exercised, perfected and not subsequently withdrawn under Virginia law) would be converted into the right to receive $1.00 in cash and 0.522 shares of Apple Hospitality’s common shares, and each Series B convertible preferred share of the Company would be converted into the right to receive (i) a number of common shares of Apple Hospitality equal to 12.11423 multiplied by 0.522 and (ii) an amount equal to 12.11423 multiplied by $1.00 in cash. Also, under the merger agreement, Apple Hospitality would assume all of the Company’s assets and liabilities at closing. The merger agreement provides the Company with a 45-day “go-shop period” (expiring at 11:59 pm on May 28, 2016), during which the Company and its subsidiaries and representatives may initiate, solicit, provide information and enter into discussions concerning proposals relating to alternative business combination transactions. The merger is subject to shareholder approval by each of the companies and to other customary closing conditions. As a result, there is no assurance that the merger will occur. In accordance with the merger agreement, the Company suspended its Unit Redemption Program effective after the April 2016 redemptions and will continue the suspension until the merger agreement is terminated or the merger is completed. On April 29, 2016, the Company closed on the purchase of a newly constructed 153-room Homewood Suites hotel in Cape Canaveral, Florida that opened for business in April 2016. The gross purchase price was $25.2 million.

Accounting Policies, by Policy

Accounting Policies, by Policy (Policies)	3 Months Ended
	Mar. 31, 2016
Accounting Policies [Abstract]
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]	Organization Apple REIT Ten, Inc., together with its wholly owned subsidiaries (the “Company”), is a Virginia corporation that has elected to be treated as a real estate investment trust (“REIT”) for federal income tax purposes. The Company was formed to invest in hotels and other income-producing real estate in selected metropolitan areas in the United States. Initial capitalization occurred on August 13, 2010, when 10 Units, each Unit consisting of one common share and one Series A preferred share, were purchased by Apple Ten Advisors, Inc. (“A10A”) and 480,000 Series B convertible preferred shares were purchased by Glade M. Knight, the Company’s Chairman and Chief Executive Officer. The Company began operations on March 4, 2011, when it purchased its first hotel. The Company concluded its best-efforts offering on July 31, 2014. The Company’s fiscal year end is December 31. The Company has no foreign operations or assets and its operating structure includes only one reportable segment. The consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany accounts and transactions have been eliminated. Although the Company has an interest in a potential variable interest entity through its purchase commitment, it is not the primary beneficiary as the Company does not have any elements of power in the decision making process of this entity, and therefore does not consolidate the entity. As of March 31, 2016, the Company owned 55 hotels located in 17 states with an aggregate of 7,056 rooms.
Basis of Accounting, Policy [Policy Text Block]	Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in accordance with the rules and regulations for reporting on Form 10-Q. Accordingly, they do not include all of the information required by accounting principles generally accepted in the United States for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. These unaudited financial statements should be read in conjunction with the Company’s audited consolidated financial statements included in its 2015 Annual Report on Form 10-K. Operating results for the three months ended March 31, 2016 are not necessarily indicative of the results that may be expected for the twelve month period ending December 31, 2016.
Use of Estimates, Policy [Policy Text Block]	Use of Estimates The preparation of the financial statements in conformity with United States generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates.
Reclassification, Policy [Policy Text Block]	Reclassifications Certain prior period amounts in the consolidated financial statements have been reclassified to conform to the current period presentation with no effect on previously reported net income, shareholders’ equity or cash flows.
Earnings Per Share, Policy [Policy Text Block]	Net Income Per Common Share Basic net income per common share is computed based upon the weighted average number of shares outstanding during the period. Diluted net income per common share is calculated after giving effect to all potential common shares that were dilutive and outstanding for the period. There were no potential common shares with a dilutive effect for the three months ended March 31, 2016 and 2015. As a result, basic and diluted net income per common share were the same. Series B convertible preferred shares are not included in net income per common share calculations until such time that such shares are eligible to be converted to common shares.

Investment in Real Estate (Tabl

Investment in Real Estate (Tables)	3 Months Ended
	Mar. 31, 2016
Real Estate [Abstract]
Property, Plant and Equipment [Table Text Block]	The Company’s total investment in real estate consisted of the following (in thousands): March 31, December 31, 2016 2015 Land $ 89,823 $ 89,823 Building and Improvements 872,377 871,454 Furniture, Fixtures and Equipment 81,621 80,983 Franchise Fees 3,682 3,682 1,047,503 1,045,942 Less Accumulated Depreciation (116,854 ) (107,525 ) Investment in Real Estate, net $ 930,649 $ 938,417

Shareholders' Equity (Tables)

Shareholders' Equity (Tables)	3 Months Ended
	Mar. 31, 2016
Stockholders' Equity Note [Abstract]
Summary of Unit Redemptions [Table Text Block]	The following is a summary of the Unit redemptions during 2015 and the first three months of 2016: Redemption Date Total Requested Unit Redemptions at Redemption Date Units Redeemed Total Redemption Requests Not Redeemed at Redemption Date First Quarter 2015 425,833 425,833 0 Second Quarter 2015 402,201 402,201 0 Third Quarter 2015 524,458 524,458 0 Fourth Quarter 2015 899,680 899,680 0 First Quarter 2016 582,852 582,852 0

Organization and Summary of S16

Organization and Summary of Significant Accounting Policies (Details)	3 Months Ended
	Mar. 31, 2016shares	Mar. 31, 2015shares	Dec. 31, 2015shares
Organization and Summary of Significant Accounting Policies (Details) [Line Items]
Unit Description	one common share and one Series A preferred share
Preferred Stock, Shares Issued	0		0
Number of Reportable Segments	1
Number of Hotels	55
Number of States in which Hotels Are Located	17
Aggregate Number of Hotel Rooms	7,056
Weighted Average Number Diluted Shares Outstanding Adjustment	0	0
Issued on August 13, 2010 (Initial Capitalization) [Member]
Organization and Summary of Significant Accounting Policies (Details) [Line Items]
Units sold at inception	10
Series B Convertible Preferred Stock [Member]
Organization and Summary of Significant Accounting Policies (Details) [Line Items]
Preferred Stock, Shares Issued	480,000		480,000
Series B Convertible Preferred Stock [Member] | Issued on August 13, 2010 (Initial Capitalization) [Member]
Organization and Summary of Significant Accounting Policies (Details) [Line Items]
Preferred Stock, Shares Issued	480,000

Investment in Real Estate (Deta

Investment in Real Estate (Details) $ in Millions	1 Months Ended
	Apr. 29, 2016USD ($)	Mar. 31, 2016USD ($)
Investment in Real Estate (Details) [Line Items]
Number of Hotels		55
Aggregate Number of Hotel Rooms		7,056
Number of States in which Hotels Are Located		17
Homewood Suites Cape Canaveral, FL [Member] | Potential Purchase of Additional Hotels [Member]
Investment in Real Estate (Details) [Line Items]
Aggregate Number of Hotel Rooms		153
Business Acquisition, Gross Purchase Price (in Dollars)		$ 25.2
Homewood Suites Cape Canaveral, FL [Member] | Hotel Acquisitions [Member] | Subsequent Event [Member]
Investment in Real Estate (Details) [Line Items]
Aggregate Number of Hotel Rooms	153
Business Acquisition, Gross Purchase Price (in Dollars)	$ 25.2
Business Acquisition, Description	Construction of the hotel was completed and the hotel opened for business in April 2016. The Company closed on the purchase of the hotel on April 29, 2016.

Investment in Real Estate (Det

Investment in Real Estate (Details) - Investment in Real Estate - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Investment in Real Estate [Abstract]
Land	$ 89,823	$ 89,823
Building and Improvements	872,377	871,454
Furniture, Fixtures and Equipment	81,621	80,983
Franchise Fees	3,682	3,682
	1,047,503	1,045,942
Less Accumulated Depreciation	(116,854)	(107,525)
Investment in Real Estate, net	$ 930,649	$ 938,417

Credit Facility (Details)

Credit Facility (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2016	Apr. 30, 2016	Dec. 31, 2015
Credit Facility (Details) [Line Items]
Long-term Line of Credit (in Dollars)	$ 44,700		$ 30,400
Revolving Credit Facility [Member]
Credit Facility (Details) [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity (in Dollars)	100,000
Long-term Line of Credit (in Dollars)	$ 44,700		$ 30,400
Line of Credit Facility, Interest Rate at Period End	2.29%
Line of Credit Facility, Expiration Date	July 2,017
Debt Instrument, Maturity Date, Description	The Company has the right, upon satisfaction of certain conditions, including covenant compliance and payment of an extension fee, to extend the maturity date to July 2018.
Line of Credit Facility, Covenant Terms	The credit facility contains customary affirmative covenants, negative covenants and events of default. In addition, the credit facility contains covenants restricting the level of certain investments and quarterly financial covenants which include, among others, a minimum net worth, maximum debt limits, minimum debt service and fixed charge coverage ratios, and maximum distribution limits. The Company was in compliance with each of the applicable covenants at March 31, 2016. Effective 2016, distributions are limited to 100% of Funds From Operations (as defined in the credit agreement).
Revolving Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member]
Credit Facility (Details) [Line Items]
Debt Instrument, Description of Variable Rate Basis	one-month LIBOR
Revolving Credit Facility [Member] | Minimum [Member]
Credit Facility (Details) [Line Items]
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage	0.20%
Revolving Credit Facility [Member] | Minimum [Member] | London Interbank Offered Rate (LIBOR) [Member]
Credit Facility (Details) [Line Items]
Debt Instrument, Basis Spread on Variable Rate	1.85%
Revolving Credit Facility [Member] | Maximum [Member]
Credit Facility (Details) [Line Items]
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage	0.30%
Revolving Credit Facility [Member] | Maximum [Member] | London Interbank Offered Rate (LIBOR) [Member]
Credit Facility (Details) [Line Items]
Debt Instrument, Basis Spread on Variable Rate	2.35%
Amended Revolving Credit Facility [Member] | Subsequent Event [Member]
Credit Facility (Details) [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity (in Dollars)		$ 150,000

Fair Value of Financial Instr20

Fair Value of Financial Instruments (Details) - USD ($) $ in Millions	Mar. 31, 2016	Dec. 31, 2015
Fair Value Disclosures [Abstract]
Long-term Debt	$ 240.5	$ 227.3
Long-term Debt, Fair Value	$ 238.4	$ 225.6

Related Parties (Details)

Related Parties (Details) - USD ($)	3 Months Ended		68 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2016	Dec. 31, 2015
Related Parties (Details) [Line Items]
Related Party Transaction, Description of Transaction	To efficiently manage cash disbursements, the Company, Apple Hospitality, ARG or A10A may make payments for any or all of the related companies. Under the cash management process, each of the companies may advance or defer up to $1 million at any time. Each month, any outstanding amounts are settled among the affected companies.
Apple Hospitality's Interest in Apple Air Holding, LLC [Member]
Related Parties (Details) [Line Items]
Equity Method Investment, Ownership Percentage	74.00%		74.00%
Apple Realty Group (ARG) [Member]
Related Parties (Details) [Line Items]
Real estate acquisition and disposal fee, Related Party, Percent	2.00%
Apple Realty Group (ARG) [Member] | Real Estate Acquisition and Disposal Fees Incurred [Member]
Related Parties (Details) [Line Items]
Costs and Expenses, Related Party	$ 0	$ 1,500,000	$ 19,900,000
Apple Ten Advisors (A10A) [Member]
Related Parties (Details) [Line Items]
Management Advisory Fee, Related Party, Percent	0.1% to 0.25%
Apple Ten Advisors (A10A) [Member] | Advisory Fees Incurred [Member]
Related Parties (Details) [Line Items]
Costs and Expenses, Related Party	$ 600,000	400,000
ARG and A10A [Member] | Reimbursement to Related Party for Company's Proportionate Share of Staffing and Related Costs Provided by Related Party [Member]
Related Parties (Details) [Line Items]
Costs and Expenses, Related Party	800,000	700,000
Apple Hospitality REIT [Member] | Reimbursement to Related Party for Company's Proportionate Share of Staffing and Related Costs Provided by Related Party [Member]
Related Parties (Details) [Line Items]
Accounts Payable, Related Parties	$ 100,000		$ 100,000	$ 200,000
Apple Air Holding, LLC [Member]
Related Parties (Details) [Line Items]
Equity Method Investment, Ownership Percentage	26.00%		26.00%	26.00%
Equity Method Investments	$ 800,000		$ 800,000	$ 600,000
Income (Loss) from Equity Method Investments	$ (100,000)	$ (100,000)

Shareholders' Equity (Details)

Shareholders' Equity (Details) - USD ($) $ / shares in Units, $ in Thousands, shares in Millions	3 Months Ended		48 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2016
Shareholders' Equity (Details) [Line Items]
Payments of Ordinary Dividends, Common Stock	$ 18,232	$ 18,718
Unit Redemption Program [Member]
Shareholders' Equity (Details) [Line Items]
Unit redemption eligibility period	1 year
Redemption rate, Units owned less than 5 years	92.50%
Redemption rate, Units owned more than 5 years	100.00%
Weighted average number of Units outstanding, percentage redeemable	3.00%
Units Redeemed (in Shares)	0.6	0.4	7.9
Payments for Repurchase of Equity	$ 6,000	$ 4,400	$ 80,400
Distributions [Member]
Shareholders' Equity (Details) [Line Items]
Annual Distribution rate (in Dollars per share)	$ 0.825
Common Stock, Dividends, Per Share, Cash Paid (in Dollars per share)	$ 0.20625	$ 0.20625
Payments of Ordinary Dividends, Common Stock	$ 18,200	$ 18,700

Shareholders' Equity (Details)

Shareholders' Equity (Details) - Schedule of Unit Redemption - Redemptions [Member] - shares	3 Months Ended
	Mar. 31, 2016	Dec. 31, 2015	Sep. 30, 2015	Jun. 30, 2015	Mar. 31, 2015
Shareholders' Equity (Details) - Schedule of Unit Redemption [Line Items]
Total Requested Unit Redemptions at Redemption Date	582,852	899,680	524,458	402,201	425,833
Units Redeemed	582,852	899,680	524,458	402,201	425,833
Total Redemption Requests Not Redeemed at Redemption Date	0	0	0	0	0

Subsequent Events (Details)

Subsequent Events (Details) $ / shares in Units, $ in Thousands	Apr. 13, 2016$ / sharesshares	Apr. 30, 2016USD ($)$ / sharesshares	Mar. 31, 2016USD ($)	Mar. 31, 2015USD ($)	Apr. 29, 2016USD ($)
Subsequent Events (Details) [Line Items]
Payments of Ordinary Dividends, Common Stock			$ 18,232	$ 18,718
Payments for Repurchase of Equity			$ 5,985	$ 4,387
Number of Units in Real Estate Property			7,056
Subsequent Event [Member]
Subsequent Events (Details) [Line Items]
Payments of Ordinary Dividends, Common Stock		$ 6,100
Common Stock, Dividends, Per Share, Cash Paid | $ / shares		$ 0.06875
Units Redeemed | shares		600,000
Payments for Repurchase of Equity		$ 6,800
Redemption requests redeemed, percentage		39.00%
Redemption requests redeemed, description		pro rata basis
Weighted average number of Units outstanding, percentage redeemable		3.00%
Apple Ten and Apple Hospitality Merger Agreement [Member] | Subsequent Event [Member]
Subsequent Events (Details) [Line Items]
Business Combination, Merger Agreement Description	Under the merger agreement, each outstanding Unit of the Company (other than those with respect to which statutory dissenters’ rights of appraisal have been properly exercised, perfected and not subsequently withdrawn under Virginia law) would be converted into the right to receive $1.00 in cash and 0.522 shares of Apple Hospitality’s common shares, and each Series B convertible preferred share of the Company would be converted into the right to receive (i) a number of common shares of Apple Hospitality equal to 12.11423 multiplied by 0.522 and (ii) an amount equal to 12.11423 multiplied by $1.00 in cash. Also, under the merger agreement, Apple Hospitality would assume all of the Company’s assets and liabilities at closing. The merger agreement provides the Company with a 45-day “go-shop period” (expiring at 11:59 pm on May 28, 2016), during which the Company and its subsidiaries and representatives may initiate, solicit, provide information and enter into discussions concerning proposals relating to alternative business combination transactions. The merger is subject to shareholder approval by each of the companies and to other customary closing conditions. As a result, there is no assurance that the merger will occur.
Apple Ten and Apple Hospitality Merger Agreement [Member] | Subsequent Event [Member] | Apple Ten Unit and Series B Convertible Preferred Share Consideration [Member]
Subsequent Events (Details) [Line Items]
Business Combination, Cash Paid as Partial Consideration | $ / shares	$ 1
Business Combination, Exchange Rate of Shares Issued | shares	0.522
Convertible Preferred Stock, Shares Issued upon Conversion | shares	12.11423
Homewood Suites Cape Canaveral, FL [Member] | Hotel Acquisitions [Member] | Subsequent Event [Member]
Subsequent Events (Details) [Line Items]
Number of Units in Real Estate Property					153
Business Acquisition, Gross Purchase Price					$ 25,200