Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2015 | Aug. 13, 2015 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jun. 30, 2015 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q2 | |
Entity Registrant Name | BRE Select Hotels Corp | |
Entity Central Index Key | 1,566,445 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 100 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 |
ASSETS | ||
Investment in real estate, net of accumulated depreciation of $58,251 and $43,771, respectively | $ 986,438 | $ 974,833 |
Cash and cash equivalents | 34,091 | 22,776 |
Restricted cash | 10,294 | 40,719 |
Due from third party managers, net | 7,940 | 4,764 |
Prepaid expenses | 2,498 | 2,166 |
Deferred financing costs, net | 7,310 | 9,817 |
Goodwill | 126,377 | 126,377 |
Other assets | 2,053 | 912 |
TOTAL ASSETS | 1,177,001 | 1,182,364 |
LIABILITIES | ||
Accounts payable and accrued expenses | 9,717 | 18,969 |
Due to third party managers, net | 503 | 1,580 |
Mortgages payable | 847,244 | 847,453 |
TOTAL LIABILITIES | $ 857,464 | $ 868,002 |
Commitments and contingencies (Note 6) | ||
SHAREHOLDER'S EQUITY | ||
Preferred stock, $0.0001 par value, 30,000,000 shares authorized; none issued and outstanding at June 30, 2015 and December 31, 2014 | $ 0 | $ 0 |
Common stock, $0.01 par value, 100,000 shares authorized; 100 shares issued and outstanding at June 30, 2015 and December 31, 2014 | 0 | 0 |
Additional paid-in capital | 172,381 | 177,202 |
Retained earnings | 9,996 | 0 |
TOTAL SHAREHOLDER'S EQUITY | 182,377 | 177,202 |
TOTAL LIABILITIES AND SHAREHOLDER'S EQUITY | 1,177,001 | 1,182,364 |
7% Series A Cumulative Redeemable Preferred Stock [Member] | ||
LIABILITIES | ||
Cumulative Redeemable Preferred Stock, $1.90 initial liquidation preference, 120,000,000 shares authorized;72,382,848 issued and outstanding at June 30, 2015 and December 31, 2014 | $ 137,160 | $ 137,160 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 |
Accumulated depreciation of Investment in real estate | $ 58,251 | $ 43,771 |
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 30,000,000 | 30,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 100,000 | 100,000 |
Common stock, shares issued | 100 | 100 |
Common stock, shares outstanding | 100 | 100 |
7% Series A Cumulative Redeemable Preferred Stock [Member] | ||
Preferred Shares Dividend Percentage | 7.00% | 7.00% |
Preferred stock initial liquidation preference per share | $ 1.90 | $ 1.90 |
Preferred stock, shares authorized | 120,000,000 | 120,000,000 |
Preferred stock, shares issued | 72,382,848 | 72,382,848 |
Preferred stock, shares outstanding | 72,382,848 | 72,382,848 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
REVENUE | ||||
Room revenue | $ 71,478 | $ 68,504 | $ 130,787 | $ 125,646 |
Other revenue | 4,667 | 4,829 | 8,836 | 9,174 |
Total revenue | 76,145 | 73,333 | 139,623 | 134,820 |
EXPENSES | ||||
Operating expense | 17,758 | 17,007 | 33,571 | 32,406 |
Hotel administrative expense | 5,971 | 5,714 | 11,291 | 10,984 |
Sales and marketing | 5,735 | 5,467 | 10,831 | 10,201 |
Utilities | 2,268 | 2,282 | 4,655 | 4,714 |
Repair and maintenance | 2,809 | 2,712 | 5,467 | 5,372 |
Franchise fees | 3,548 | 3,408 | 6,478 | 6,254 |
Management fees | 2,638 | 2,901 | 4,764 | 5,039 |
Taxes, insurance and other | 3,742 | 3,541 | 7,447 | 6,891 |
General and administrative | 1,400 | 827 | 2,165 | 1,765 |
Depreciation expense | 8,424 | 6,662 | 15,709 | 13,234 |
Total expenses | 54,293 | 50,521 | 102,378 | 96,860 |
Loss on disposals of investment in real estate | (2,876) | 0 | (2,876) | 0 |
Operating income | 18,976 | 22,812 | 34,369 | 37,960 |
Interest expense, net | (7,620) | (9,713) | (15,118) | (19,030) |
Loss on derivatives | (14) | (223) | (53) | (419) |
Income from continuing operations before income tax benefit | 11,342 | 12,876 | 19,198 | 18,511 |
Income tax expense | (1,925) | (1,749) | (202) | (814) |
Income from continuing operations | 9,417 | 11,127 | 18,996 | 17,697 |
Income from discontinued operations, net of tax (Note 11) | 0 | 2 | 0 | 69 |
Net income | 9,417 | 11,129 | 18,996 | 17,766 |
Net income available for common stockholders | $ 7,006 | $ 7,898 | $ 14,175 | $ 14,535 |
Basic and diluted net income per common share | ||||
From continuing operations, after Series A Preferred Stock dividends | $ 70,060 | $ 78,960 | $ 141,750 | $ 144,660 |
From discontinued operations | 0 | 20 | 0 | 690 |
Total basic and diluted net income per common share available to common stockholders | 70,060 | 78,980 | 141,750 | 145,350 |
Dividends declared per common share | $ 90,000 | $ 90,000 | $ 90,000 | $ 90,000 |
Weighted average common shares outstanding -basic and diluted | 100 | 100 | 100 | 100 |
Series A Preferred Stock [Member] | ||||
EXPENSES | ||||
Series A Preferred Stock dividends declared | $ (2,411) | $ (3,231) | $ (4,821) | $ (3,231) |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Cash flows from operating activities: | ||
Net income | $ 18,996 | $ 17,766 |
Adjustments to reconcile net income to cash provided by operating activities: | ||
Depreciation | 15,709 | 13,234 |
Loss on disposals of investment in real estate | 2,876 | 0 |
Gain on sale of assets | 0 | (81) |
Fair value adjustment of interest rate cap | 53 | 419 |
Amortization of deferred financing costs | 2,507 | 2,746 |
Other non-cash expenses, net | (15) | (15) |
Changes in operating assets and liabilities: | ||
Decrease (increase) in cash restricted for operating expenses | 4,527 | (256) |
(Increase) decrease in due to/from third party managers, net | (4,253) | 1,133 |
(Increase) decrease in prepaid expenses and other assets | (1,720) | 1,554 |
Decrease in accounts payable and accrued expenses | (838) | (1,876) |
Net cash provided by operating activities | 37,842 | 34,624 |
Cash flows from investing activities: | ||
Capital improvements | (38,589) | (15,362) |
Proceeds from sale of assets, net | 0 | 8,102 |
Property insurance proceeds | 194 | 353 |
Decrease in cash restricted for property improvements | 25,898 | 2,567 |
Net cash used in investing activities | (12,497) | (4,340) |
Cash flows from financing activities: | ||
Payments of mortgage debt | (209) | (6,752) |
Payments of mezzanine debt | 0 | (1,911) |
Dividends paid to Series A Preferred shareholders | (4,821) | (6,462) |
Dividends paid to common shareholders | (9,000) | (14,000) |
Net cash used in financing activities | (14,030) | (29,125) |
Net increase in cash and cash equivalents | 11,315 | 1,159 |
Cash and cash equivalents, beginning of period | 22,776 | 23,902 |
Cash and cash equivalents, end of period | 34,091 | 25,061 |
Supplemental Cash Flow Information, including Non-Cash Activities: | ||
Interest paid | 12,909 | 16,709 |
Taxes paid | 1,531 | 919 |
Accrued capital improvements | 2,885 | 783 |
7% Series A Cumulative Redeemable Preferred Stock [Member] | ||
Supplemental Cash Flow Information, including Non-Cash Activities: | ||
Accrued 7% Series A Preferred Stock dividends | $ 2,411 | $ 3,231 |
Organization
Organization | 6 Months Ended |
Jun. 30, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization | 1. Organization BRE Select Hotels Corp, together with its wholly-owned subsidiaries (the “Company”), is a Delaware corporation that made an election, through the filing of Form 1120-REIT for 2012, to qualify as a real estate investment trust, or REIT, for federal income tax purposes. The Company was formed on November 28, 2012 to invest in income-producing real estate in the United States through the acquisition of Apple REIT Six, Inc. (“Apple Six”) on behalf of BRE Select Hotels Holdings LP (“BRE Holdings”), a Delaware limited partnership and an affiliate of the Company. 100% of the common stock of the Company is owned by BRE Holdings, which is an affiliate of Blackstone Real Estate Partners VII L.P. (the “Sponsor”). The acquisition of Apple Six (the “Merger”) was completed on May 14, 2013 (the “Acquisition Date”). As of June 30, 2015, the Company owned 62 hotels located in 18 states with an aggregate of 7,346 rooms. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2015 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Principles of Consolidation - Basis of Presentation - Use of Estimates - Cash and Cash Equivalents - Restricted Cash - Due from Third Party Managers, net - Due to Third Party Managers, net - Investment in Real Estate and Related Depreciation - Impairment of Investment in Real Estate - Goodwill - Revenue Recognition - Sales and Marketing Costs - Income Taxes - Valuation of Deferred Tax Assets - Income per Common Share - Segment Information - New Accounting Pronouncements - Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity We expect that future disposals of operating real estate assets will not qualify for discontinued operations reporting treatment, unless the disposals represent a strategic shift that will have a major effect on the Company’s operations and financial results. There were no hotels sold or held for sale during the three and six months ended June 30, 2015. The discontinued operations presented for the interim periods ended June 30, 2014 represent individual sales of hotels which occurred prior to the Company’s adoption of ASU No. 2014-08 (see Note 11) and represented discontinued operations under the previous accounting guidance. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers In August 2014, the FASB issued ASU 2014-15, Presentation of Financial Statements – Going Concern In April 2015, the FASB issued ASU 2015-03, Interest – Imputation of Interest (Subtopic 835-30). |
Investment in Real Estate, net
Investment in Real Estate, net | 6 Months Ended |
Jun. 30, 2015 | |
Real Estate [Abstract] | |
Investment in Real Estate, net | 3. Investment in Real Estate, net Investment in real estate, net as of June 30, 2015 and December 31, 2014 consisted of the following (in thousands): June 30, December 31, Land and Improvements $ 154,617 $ 154,353 Building and Improvements 823,393 805,183 Furniture, Fixtures and Equipment 42,946 34,947 Construction in Progress 23,733 24,121 1,044,689 1,018,604 Less: Accumulated Depreciation (58,251 ) (43,771 ) Investment in Real Estate, net $ 986,438 $ 974,833 |
Mortgages Payable
Mortgages Payable | 6 Months Ended |
Jun. 30, 2015 | |
Mortgage Loans on Real Estate [Abstract] | |
Mortgages Payable | 4. Mortgages Payable On December 3, 2014, certain indirect wholly-owned subsidiaries (the “Borrowers”) of the Company entered into a loan agreement (the “Loan Agreement”) with commercial lenders (collectively, the “Lenders”), pursuant to which the Borrowers obtained an $830 million mortgage loan from the Lenders (the “Loan”). The Loan is secured by first-priority, cross-collateralized mortgage liens on 61 of the 62 properties owned or ground-leased by certain subsidiaries of the Company, all related personal property, reserves, a pledge of all income received by the Borrowers with respect to the properties, a pledge of the ownership interests in the operating lessee and a security interest in a cash management account. A portion of the proceeds from the Loan were used to repay the mortgage and mezzanine loans obtained on May 14, 2013 by the Borrowers, as well as certain indirect wholly-owned subsidiaries of the Company that own direct and indirect interests in the Borrowers (the “Mezzanine Borrowers”), in the aggregate original principal amount of $775 million and with an aggregate outstanding principal amount of $763.9 million as of the date of repayment. Accordingly, on December 3, 2014, the Borrowers and Mezzanine Borrowers repaid in full, cancelled and terminated their respective mortgage and mezzanine loan agreements outstanding at that date without any penalties incurred. The initial interest rate of the Loan is equal to the one-month London interbank offered rate for deposits, or LIBOR, plus a margin rate of 2.80%. In connection with the Loan, the Borrowers entered into an interest rate cap agreement, which caps the base interest rate before applying the applicable margins on the Loan, for an aggregate notional amount of $830 million, a termination date of December 9, 2016 and a strike rate of 4.50%. The Loan is scheduled to mature on December 9, 2016, with an option for the Borrowers to extend the initial term for three one-year extension terms, subject to certain conditions. The Loan is not subject to any mandatory principal amortization. The Loan contains various representations and warranties, as well as certain financial, operating and other covenants that will among other things, limit the Company’s ability to: • incur additional secured or unsecured indebtedness; • make cash distributions at any time that the debt yield, representing the quotient (expressed as a percentage) calculated by dividing the annualized net operating income of the properties subject to the Loan by the outstanding principal amount of the indebtedness under the Loan, is less than 7.50% during the first four years of the Loan and 7.75% during the fifth year of the Loan or if there is a default continuing under the Loan, until such time as the debt yield is equal to or greater than 7.50% during the first four years of the Loan and 7.75% during the fifth year of the Loan or the Loan default has been cured; • make investments or acquisitions; • use assets as security in other transactions; • sell assets (except that the Borrowers are permitted to sell assets so long as the debt yield is not reduced, subject to payment of applicable prepayment premiums and other property release requirements); • guarantee other indebtedness; and • consolidate, merge or transfer all or substantially all of the Company’s assets. Defaults under the Loan include, among other things, the failure to pay interest or principal when due, material misrepresentations, transfers of the underlying security for the Loan without any required consent from the Lender, defaults under certain agreements relating to the properties, including franchise and management agreements, bankruptcy of a Borrower or any guarantor of the Loan, failure to maintain required insurance and a failure to observe other covenants under the Loan, in each case subject to any applicable cure rights. The Borrowers may prepay the Loan, in whole or in part, at any time, except that, if a prepayment is made at any time during the period from the first month through the ninth month of the initial term of the Loan and such prepayment, when aggregated with all other prepayments made by the Borrowers, exceeds 15% of the amount of the Loan funded to the Borrowers, then the Borrowers will pay to the Lender an amount equal to the then effective margin rate on the principal being prepaid for the period from the date of the prepayment through the ninth month of the initial term of the Loan. Any prepayment made after the ninth month of the initial term of the Loan may be made without any prepayment penalty or fee. Notwithstanding the foregoing, any prepayment of the Loan with casualty or condemnation proceeds will not be subject to any limitation on prepayment or any prepayment fee or penalty, and any prepayment to enable the Borrowers to remove a ground leased property as collateral security due to a default by the Borrower under the applicable ground lease or any prepayment to enable the Borrowers to remove a property that is subject to a default under a franchise agreement encumbering such property will not be subject to any prepayment fee or penalty, but will be subject to limited conditions to prepayment. In addition, the applicable Borrowers for the Loan and BSHH LLC, a Delaware limited liability company (the “Guarantor”) and an affiliate of BRE Holdings, will have recourse liability under the Loan for certain matters typical of a transaction of this type, including, without limitation, relating to losses arising out of actions by the Borrower, Guarantor, Sponsor or their respective affiliates controlled by the Sponsor which constitute fraud, intentional misrepresentation, misappropriation of funds (including insurance proceeds), removal or disposal of any property after an event of default under the Loan, a material violation of the due on sale/encumbrance covenants set forth in the loan agreements, willful misconduct that results in waste to any property and any material modification or voluntary termination of a ground lease without the Lender’s prior written consent if required under the loan agreements. The Borrowers will also have recourse liability for the Loan in the event any security instrument or loan agreement is deemed a fraudulent conveyance or a preference, and the Borrowers and the Guarantor will have recourse liability for the Loan in the event of a voluntary or collusive involuntary bankruptcy of any Borrower or any operating lessee of the properties or in the event Borrower, Guarantor, Sponsor or their respective affiliates controlled by the Sponsor consents to or joins in the application for the appointment of a custodian, receiver, trustee or examiner of any Borrower or the operating lessee of any of the properties or any property, provided, however, the liability of the Guarantor described in this sentence shall not exceed 15% of the principal amount of the Loan outstanding at the time the event occurred. Concurrent with the execution of the documents reflecting the Loan, the Company executed an Indemnity Agreement in favor of the Guarantor pursuant to which the Company agrees to indemnify and hold the Guarantor harmless from any losses incurred by the Guarantor pursuant to the terms of the guaranty executed by the Guarantor in favor of the Lenders in connection with the Loan. The Company capitalized $6.9 million of deferred financing costs associated with the Loan. Deferred financing costs consist of amounts paid for direct and indirect costs associated with the origination of the Loan. Such costs are amortized on a straight-line basis (which approximates the effective interest method) over the term of the related debt. Amortization of deferred financing costs totaled $1.3 million and $2.5 million under the mortgage loan for the three and six months ended June 30, 2015, respectively. This compares to amortization of deferred financing costs of $1.4 million and $2.7 million under the previous mortgage and mezzanine loans for the three and six months ended June 30, 2014, respectively, and is included in interest expense in the condensed consolidated statements of operations. As part of the Merger, the Company assumed an existing loan with a commercial lender secured by the Company’s Fort Worth, Texas Residence Inn property. The loan matures on October 6, 2022 and carries a fixed interest rate of 4.73%. Principal is due monthly with the remaining outstanding principal balance due at maturity of the loan. The outstanding principal balance as of June 30, 2015 was $17.2 million and is included in mortgages payable in the condensed consolidated balance sheets. Future scheduled principal payments of debt obligations (assuming no exercise of extension options) as of June 30, 2015 are as follows (in thousands): 2015 (remaining months) $ 212 2016 830,440 2017 464 2018 487 2019 510 Thereafter 15,131 Total $ 847,244 |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 6 Months Ended |
Jun. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | 5. Fair Value of Financial Instruments In accordance with the authoritative guidance on fair value measurements and disclosures, the Company measures nonfinancial assets and liabilities subject to nonrecurring measurement and financial assets and liabilities subject to recurring measurement based on a hierarchy that prioritizes inputs to valuation techniques used to measure the fair value. Inputs used in determining fair value should be from the highest level available in the following hierarchy: Level 1 Level 2 Level 3 Determining estimated fair values of the Company’s financial instruments such as mortgages payable requires considerable judgment to interpret market data. The market assumptions and/or estimation methodologies used may have a material effect on estimated fair value amounts. Accordingly, the estimates presented are not necessarily indicative of the amounts by which these instruments could be purchased, sold, or settled. Carrying amounts and estimated fair values of financial instruments, for periods indicated, were as follows (in thousands): June 30, 2015 December 31, 2014 Carrying Estimated Carrying Estimated Financial assets and liabilities measured at fair value on a recurring basis: Interest rate caps $ 6 $ 6 $ 59 $ 59 Financial assets not measured at fair value: Cash and cash equivalents $ 34,091 $ 34,091 $ 22,776 $ 22,776 Restricted cash $ 10,294 $ 10,294 $ 40,719 $ 40,719 Due from third party managers, net $ 7,940 $ 7,940 $ 4,764 $ 4,764 Financial liabilities not measured at fair value: Accounts payable and accrued expenses $ 9,717 $ 9,717 $ 18,969 $ 18,969 Due to third party managers, net $ 503 $ 503 $ 1,580 $ 1,580 Mortgages payable $ 847,244 $ 846,609 $ 847,453 $ 846,927 Interest rate caps - Cash, cash equivalents and restricted cash - Due from/to third party managers, accounts payable and accrued expenses Mortgages payable - |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 6. Commitments and Contingencies Legal Fees - The Company, as successor to Apple Six, will pay 20%, and the other parties to the litigation cost sharing agreement will pay 80%, of the fees and expenses of specified counsel or any other counsel, consultant or service provider jointly retained in connection with the Apple REIT class action litigation, incurred after November 29, 2012 in connection with the Apple REIT class action litigation. The following is a description of the Apple REIT class action litigation: On December 13, 2011, the United States District Court for the Eastern District of New York (the “District Court”) ordered that three putative class actions, Kronberg, et al. v. David Lerner Associates, Inc., et al., Kowalski v. Apple REIT Ten, Inc., et al., and Leff v. Apple REIT Ten, Inc., et al., be consolidated and amended the caption of the consolidated matter to be In re Apple REITs Litigation. The District Court also appointed lead plaintiffs and lead counsel for the consolidated action and ordered lead plaintiffs to file and serve a consolidated complaint by February 17, 2012. Apple Six was previously named as a party in the Kronberg, et al. v. David Lerner Associates, Inc. et al. class action lawsuit, which was filed on June 20, 2011. On February 17, 2012, lead plaintiffs and lead counsel in the In re Apple REITs Litigation, Civil Action No. 1:11-cv-02919-KAM-JO, filed an amended consolidated complaint in the United States District Court for the Eastern District of New York against Apple Six, Apple Suites Realty Group, Inc., Apple Eight Advisors, Inc., Apple Nine Advisors, Inc., Apple Ten Advisors, Inc., Apple Fund Management, LLC, Apple REIT Seven, Inc., Apple REIT Eight, Inc., Apple REIT Nine, Inc. and Apple REIT Ten, Inc., their directors and certain officers, and David Lerner Associates, Inc. (“David Lerner Associates”) and David Lerner. Apple REIT Seven, Inc., Apple REIT Eight, Inc., Apple REIT Nine, Inc. and Apple REIT Ten, Inc. are collectively referred to as “other Apple REIT companies.” The consolidated complaint, purportedly brought on behalf of all purchasers of units in Apple Six and the other Apple REIT companies, or those who otherwise acquired these units that were offered and sold to them by David Lerner Associates or its affiliates and on behalf of subclasses of shareholders in New Jersey, New York, Connecticut and Florida, asserts claims under Sections 11, 12 and 15 of the Securities Act of 1933. The consolidated complaint also asserts claims for breach of fiduciary duty, aiding and abetting breach of fiduciary duty, negligence, and unjust enrichment, and claims for violation of the securities laws of Connecticut and Florida. The complaint seeks, among other things, certification of a putative nationwide class and the state subclasses, damages, rescission of share purchases and other costs and expenses. On February 16, 2012, one shareholder of Apple Six and Apple REIT Seven, Inc., filed a putative class action lawsuit captioned Laurie Brody v. David Lerner Associates, Inc., et al., Case No. 1:12-cv-782-ERK-RER, in the United States District Court for the Eastern District of New York against Apple Six, Apple REIT Seven, Inc., Glade M. Knight, Apple Suites Realty Group, Inc., David Lerner Associates, and certain executives of David Lerner Associates. The complaint, purportedly brought on behalf of all purchasers of units of Apple Six and Apple REIT Seven, Inc., or those who otherwise acquired these units, asserts claims for breach of fiduciary duty and aiding and abetting breach of fiduciary duty, unjust enrichment, negligence, breach of written or implied contract (against the David Lerner Associates defendants only), and for violation of New Jersey’s state securities laws. On March 13, 2012, by order of the court, Laurie Brody v. David Lerner Associates, Inc., et al. was consolidated into the In re Apple REITs Litigation. On April 18, 2012, Apple Six and the other Apple REIT companies served a motion to dismiss the consolidated complaint in the In re Apple REITs Litigation. Apple Six and the other Apple REIT companies accompanied their motion to dismiss the consolidated complaint with a memorandum of law in support of their motion to dismiss the consolidated complaint. On April 3, 2013, the motion to dismiss the consolidated complaint in the In re Apple REITs Litigation was granted in full with prejudice. On April 12, 2013, plaintiffs filed a notice of appeal in the Apple REIT class action litigation, appealing the decision to the United States Court of Appeals for the Second Circuit. On July 26, 2013, plaintiffs filed a brief in support of their appeal. On October 25, 2013, defendants filed a brief opposing plaintiffs’ appeal. On November 15, 2013, plaintiffs filed a reply brief in further support of their appeal. Oral argument on plaintiffs’ appeal was held on March 31, 2014. On April 23, 2014, the United States Court of Appeals for the Second Circuit (the “Second Circuit”) entered a summary order in the In re Apple REITs Litigation. In the summary order, the Second Circuit affirmed the dismissal by the District Court of the federal securities claims and state securities law claims and affirmed the dismissal of the unjust enrichment claim. However, the Second Circuit vacated the District Court’s dismissal of the plaintiffs’ state law breach of fiduciary duty, aiding and abetting a breach of fiduciary duty, and negligence claims and remanded for further proceedings. After remand, on June 6, 2014, defendants filed a brief in support of their motion to dismiss. On July 9, 2014, plaintiffs filed an opposition brief. Defendants’ reply brief was filed on August 8, 2014. On March 25, 2015, the District Court granted defendants’ motion to dismiss in full, with prejudice. The time to file a notice of appeal of that decision has expired, and no such notice has been filed. The Company does not expect to owe any additional amounts under the cost sharing agreement. Franchise Agreements Management Agreements - TRS Lease Agreements - Ground Leases 2015 (remaining months) $ 137 2016 275 2017 240 2018 206 2019 99 Thereafter 424 Total $ 1,381 |
7% Series A Cumulative Redeemab
7% Series A Cumulative Redeemable Preferred Stock | 6 Months Ended |
Jun. 30, 2015 | |
Equity [Abstract] | |
7% Series A Cumulative Redeemable Preferred Stock | 7. 7% Series A Cumulative Redeemable Preferred Stock In connection with the Merger, the Company issued 97,032,848 shares of Series A Preferred Stock. The terms of these shares provide the Company with the right to redeem such shares at any time for an amount equal to the liquidation preference, plus any accumulated and unpaid dividends. In addition, the terms of these shares include an option for a holder of such shares to require the Company to redeem all or a portion of such holder’s shares on or after November 14, 2020 for an amount equal to the liquidation preference, plus any accumulated and unpaid dividends. The initial dividend rate on these shares is 7% per annum. The dividend rate will increase to 9% per annum if dividends are not paid in cash for more than six quarters, and to 11% per annum if they are not redeemed after the earlier of certain change of control events and May 14, 2018. Due to the put option provided to the holders of these shares, such shares have been classified outside permanent shareholder’s equity. On December 31, 2014, approximately $47.5 million of the proceeds of the Loan were used to redeem 24,650,000 shares of the Series A Preferred Stock. Shares were redeemed on a pro rata basis from each shareholder at a redemption price of $1.9281 per share, which was comprised of the $1.90 liquidation preference per share plus $0.0281 in accumulated and unpaid dividends earned through the December 31, 2014 redemption date. On September 30, 2013, BRE Holdings purchased approximately 2.0 million shares of the Series A Preferred Stock for $1.30 per share as part of a tender offer extended to all shareholders. As of June 30, 2015, BRE Holdings owned approximately 1.5 million shares of the Series A Preferred Stock due to the redemption. The initial liquidation preference of $1.90 per share will be subject to downward adjustment should net costs and payments relating to certain legacy litigation and regulatory matters exceed $3.5 million from the date of the Merger Agreement (November 29, 2012). The Company recognizes changes in the redemption value immediately as they occur and adjusts the carrying amount of the Series A Preferred Stock to equal the redemption value at the end of each reporting period. As of June 30, 2015, the initial liquidation preference had not been adjusted. On March 31, 2015, the Board of Directors of the Company declared a dividend for the Series A Preferred Stock of $0.0333 per share, which was paid on April 15, 2015 to shareholders of record on April 1, 2015. On June 30, 2015, the Board of Directors of the Company declared a dividend for the Series A Preferred Stock of $0.0333 per share, which was payable on July 15, 2015 to shareholders of record on July 1, 2015. As of June 30, 2015, the Company accrued $2.4 million for the dividend declared on June 30, 2015, which is included in accounts payable and accrued expenses in the condensed consolidated balance sheets. |
Shareholders' Equity
Shareholders' Equity | 6 Months Ended |
Jun. 30, 2015 | |
Equity [Abstract] | |
Shareholders' Equity | 8. Shareholders’ Equity The Company is authorized to issue 150,100,000 shares of capital stock pursuant to its Amended and Restated Certificate of Incorporation, consisting of (i) 100,000 shares of common stock, par value $0.01 per share, and (ii) 150,000,000 shares of preferred stock, par value $0.0001 per share. Holders of the Company’s common stock are entitled to one vote for each share of common stock held. At June 30, 2015 and December 31, 2014, there were 100 shares of common stock issued and outstanding. On May 11, 2015, the Board of Directors of the Company declared a dividend for common stock of $90,000 per share, which was paid on May 13, 2015. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 9. Income Taxes The Company accounts for TRS income taxes using the asset and liability method. Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to the differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. The analysis utilized by the Company in determining the deferred tax valuation allowance involves considerable management judgment and assumptions. For the three months ended June 30, 2015 and 2014, the Company recorded $1.9 million and $1.7 million of income tax expense, respectively. For the six months ended June 30, 2015 and 2014, the Company recorded $0.2 million and $0.8 million of income tax expense, respectively. Tax expense for the three and six months ended June 30, 2015 and 2014 is comprised of federal and state income taxes. |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Jun. 30, 2015 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 10. Related Party Transactions The Sponsor and its affiliates are in the business of making investments in companies and real estate assets and currently own, and may, from time to time acquire and hold, in each case, interests in businesses or assets that compete directly or indirectly with the Company. In addition, certain affiliates of the Sponsor have significant influence over Hilton, which indirectly owns the entities that serve as franchisors and receive franchise fees for 27 of the hotels owned by the Company. In connection with the Sponsor’s and its affiliates’ business activities, the Sponsor, BRE Holdings or any of their affiliates, including, without limitation, Hilton or its subsidiaries, may from time to time enter into arrangements with the Company or its subsidiaries. These arrangements may be subject to restrictions on affiliate transactions contained in agreements entered into in connection with the Loan. The Company incurred $4.6 million and $4.0 million of franchise fees, marketing fees, and other expenses during the three months ended June 30, 2015 and 2014, respectively, under agreements with Hilton or its subsidiaries. The Company incurred $8.5 million and $7.5 million of franchise fees, marketing fees, and other expenses during the six months ended June 30, 2015 and 2014, respectively, under agreements with Hilton or its subsidiaries. In addition, the Company uses Hilton to procure select capital improvements for its hotels. Under this arrangement, the Company paid Hilton $0.3 million and $0 during the three months ended June 30, 2015 and 2014, respectively, and $3.1 million and $0 during the six months ended June 30, 2015 and 2014, respectively. In addition, the Company owed Hilton $0 and $1.2 million as of June 30, 2015 and December 31, 2014, respectively, related to capital improvements, which is included in accounts payable and accrued expenses in the condensed consolidated balance sheets. A management company provided services to the Company including financial, accounting, administrative and other services that may be requested from time to time pursuant to a corporate services agreement. Affiliates of the Sponsor hold a management interest in this management company. The Company paid $0.3 million and $0.2 million to this management company during the three months ended June 30, 2015 and 2014, respectively, and $0.8 million and $0.4 million during the six months ended June 30, 2015 and 2014, respectively. In addition, the Company owed this management company $0.2 million and $0 as of June 30, 2015 and December 31, 2014, respectively, which is included in accounts payable and accrued expenses in the condensed consolidated balance sheets. |
Discontinued Operations
Discontinued Operations | 6 Months Ended |
Jun. 30, 2015 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | 11. Discontinued Operations The Company sold four hotels during 2014 as summarized below (in thousands): Hotel Sale Date Net Proceeds Gain/ Fairfield Inn - Orange Park, Florida April 23, 2014 $ 2,978 ($ 67 ) Fairfield Inn - Birmingham, Alabama May 8, 2014 1,509 223 SpringHill Suites - Savannah, Georgia June 2, 2014 3,405 (285 ) SpringHill Suites - Montgomery, Alabama September 4, 2014 1,488 (21 ) Total $ 9,380 ($ 150 ) The results of operations for these properties prior to the sale are classified as income from discontinued operations in the accompanying condensed consolidated statement of operations for the three and six months ended June 30, 2014. The following table sets forth the operating results from discontinued operations (in thousands). Three Months Six Months Total revenue $ 941 $ 2,225 Hotel operating expenses 724 1,716 Taxes, insurance and other 29 132 General and administrative 23 58 Interest expense 181 301 Income tax expense 63 30 Gain from hotel dispositions 81 81 Income from discontinued operations $ 2 $ 69 The Company allocates interest expense to discontinued operations and has included such interest expense in computing income from discontinued operations. Interest expense was allocated by taking the loan release amounts for the discontinued operations, as a percentage of the total outstanding principal, multiplied by the interest expense for the period. |
Summary of Significant Accoun17
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2015 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation - |
Basis of Presentation | Basis of Presentation - |
Use of Estimates | Use of Estimates - |
Cash and Cash Equivalents | Cash and Cash Equivalents - |
Restricted Cash | Restricted Cash - |
Due from Third Party Manager, net | Due from Third Party Managers, net - |
Due to Third Party Managers, net | Due to Third Party Managers, net - |
Investment in Real Estate and Related Depreciation | Investment in Real Estate and Related Depreciation - |
Impairment of Investment in Real Estate | Impairment of Investment in Real Estate - |
Goodwill | Goodwill - |
Revenue Recognition | Revenue Recognition - |
Sales and Marketing Costs | Sales and Marketing Costs - |
Income Taxes | Income Taxes - |
Valuation of Deferred Tax Assets | Valuation of Deferred Tax Assets - |
Income per Common Share | Income per Common Share - |
Segment Information | Segment Information - |
New Accounting Pronouncements | New Accounting Pronouncements - Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity We expect that future disposals of operating real estate assets will not qualify for discontinued operations reporting treatment, unless the disposals represent a strategic shift that will have a major effect on the Company’s operations and financial results. There were no hotels sold or held for sale during the three and six months ended June 30, 2015. The discontinued operations presented for the interim periods ended June 30, 2014 represent individual sales of hotels which occurred prior to the Company’s adoption of ASU No. 2014-08 (see Note 11) and represented discontinued operations under the previous accounting guidance. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers In August 2014, the FASB issued ASU 2014-15, Presentation of Financial Statements – Going Concern In April 2015, the FASB issued ASU 2015-03, Interest – Imputation of Interest (Subtopic 835-30). |
Investment in Real Estate, net
Investment in Real Estate, net (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Real Estate [Abstract] | |
Investment in Real Estate | Investment in real estate, net as of June 30, 2015 and December 31, 2014 consisted of the following (in thousands): June 30, December 31, Land and Improvements $ 154,617 $ 154,353 Building and Improvements 823,393 805,183 Furniture, Fixtures and Equipment 42,946 34,947 Construction in Progress 23,733 24,121 1,044,689 1,018,604 Less: Accumulated Depreciation (58,251 ) (43,771 ) Investment in Real Estate, net $ 986,438 $ 974,833 |
Mortgages Payable (Tables)
Mortgages Payable (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Mortgage Loans on Real Estate [Abstract] | |
Schedule of Future Principal Payments of Debt Obligations | Future scheduled principal payments of debt obligations (assuming no exercise of extension options) as of June 30, 2015 are as follows (in thousands): 2015 (remaining months) $ 212 2016 830,440 2017 464 2018 487 2019 510 Thereafter 15,131 Total $ 847,244 |
Fair Value of Financial Instr20
Fair Value of Financial Instruments (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
Carrying Amounts and Estimated Fair Values of Financial Instruments | Carrying amounts and estimated fair values of financial instruments, for periods indicated, were as follows (in thousands): June 30, 2015 December 31, 2014 Carrying Estimated Carrying Estimated Financial assets and liabilities measured at fair value on a recurring basis: Interest rate caps $ 6 $ 6 $ 59 $ 59 Financial assets not measured at fair value: Cash and cash equivalents $ 34,091 $ 34,091 $ 22,776 $ 22,776 Restricted cash $ 10,294 $ 10,294 $ 40,719 $ 40,719 Due from third party managers, net $ 7,940 $ 7,940 $ 4,764 $ 4,764 Financial liabilities not measured at fair value: Accounts payable and accrued expenses $ 9,717 $ 9,717 $ 18,969 $ 18,969 Due to third party managers, net $ 503 $ 503 $ 1,580 $ 1,580 Mortgages payable $ 847,244 $ 846,609 $ 847,453 $ 846,927 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Aggregate Amounts of Minimum Lease Payments under Lease Agreements | The aggregate amounts of minimum lease payments under these lease agreements for the five years subsequent to June 30, 2015 and thereafter are as follows (in thousands): 2015 (remaining months) $ 137 2016 275 2017 240 2018 206 2019 99 Thereafter 424 Total $ 1,381 |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Summary of Hotels Sold | The Company sold four hotels during 2014 as summarized below (in thousands): Hotel Sale Date Net Proceeds Gain/ Fairfield Inn - Orange Park, Florida April 23, 2014 $ 2,978 ($ 67 ) Fairfield Inn - Birmingham, Alabama May 8, 2014 1,509 223 SpringHill Suites - Savannah, Georgia June 2, 2014 3,405 (285 ) SpringHill Suites - Montgomery, Alabama September 4, 2014 1,488 (21 ) Total $ 9,380 ($ 150 ) |
Operating Results from Discontinued Operations | The following table sets forth the operating results from discontinued operations (in thousands). Three Months Six Months Total revenue $ 941 $ 2,225 Hotel operating expenses 724 1,716 Taxes, insurance and other 29 132 General and administrative 23 58 Interest expense 181 301 Income tax expense 63 30 Gain from hotel dispositions 81 81 Income from discontinued operations $ 2 $ 69 |
Organization - Additional Infor
Organization - Additional Information (Detail) | 6 Months Ended | |
Jun. 30, 2015HotelRoomState | Dec. 03, 2014Hotel | |
Organization [Line Items] | ||
Number of hotels owned | 62 | 62 |
Number of states the hotels located | State | 18 | |
Aggregate number of rooms | Room | 7,346 | |
Affiliated Entity [Member] | ||
Organization [Line Items] | ||
Percentage of common stock owned by BRE Select Hotels Holdings LP | 100.00% | |
Apple Six [Member] | ||
Organization [Line Items] | ||
Acquisition date | May 14, 2013 |
Summary of Significant Accoun24
Summary of Significant Accounting Policies - Additional Information (Detail) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015USD ($)Hotel | Jun. 30, 2014USD ($) | Jun. 30, 2015USD ($)HotelSegmentshares | Jun. 30, 2014USD ($)shares | |
Property, Plant and Equipment [Line Items] | ||||
Deposits within financial institutions | $ 250,000 | $ 250,000 | ||
Loss on disposals of investment in real estate | (2,876,000) | $ 0 | (2,876,000) | $ 0 |
Goodwill impairment | $ 0 | |||
Percentage of adjusted taxable income to be distributed to shareholders | 90.00% | |||
Valuation allowance | $ 900,000 | $ 900,000 | ||
Potential dilutive shares | shares | 0 | 0 | ||
Number of operating segment | Segment | 1 | |||
Number of hotels sold or held for sale | Hotel | 0 | 0 | ||
Buildings [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Estimated useful lives of assets | 39 years | |||
Land and Building Improvements [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Estimated useful lives of assets | 10 years | |||
Minimum [Member] | Furniture, Fixtures and Equipment [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Estimated useful lives of assets | 3 years | |||
Maximum [Member] | Furniture, Fixtures and Equipment [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Estimated useful lives of assets | 7 years |
Investment in Real Estate, ne25
Investment in Real Estate, net - Investment in Real Estate (Detail) - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 |
Real Estate Properties [Line Items] | ||
Investment in Real Estate, gross | $ 1,044,689 | $ 1,018,604 |
Less: Accumulated Depreciation | (58,251) | (43,771) |
Investment in Real Estate, net | 986,438 | 974,833 |
Land and Improvements [Member] | ||
Real Estate Properties [Line Items] | ||
Investment in Real Estate, gross | 154,617 | 154,353 |
Building and Improvements [Member] | ||
Real Estate Properties [Line Items] | ||
Investment in Real Estate, gross | 823,393 | 805,183 |
Furniture, Fixtures and Equipment [Member] | ||
Real Estate Properties [Line Items] | ||
Investment in Real Estate, gross | 42,946 | 34,947 |
Construction in Process [Member] | ||
Real Estate Properties [Line Items] | ||
Investment in Real Estate, gross | $ 23,733 | $ 24,121 |
Mortgages Payable - Additional
Mortgages Payable - Additional Information (Detail) | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2015USD ($)Hotel | Jun. 30, 2014USD ($) | Jun. 30, 2015USD ($)Hotel | Jun. 30, 2014USD ($) | Dec. 03, 2014USD ($)PropertyHotel | May. 14, 2013USD ($) | |
Mortgage Loans on Real Estate [Line Items] | ||||||
Borrowings on mortgage loan | $ 775,000,000 | |||||
Number of properties leased | Property | 61 | |||||
Number of hotels owned | Hotel | 62 | 62 | 62 | |||
Loan outstanding principal amount | $ 763,900,000 | |||||
Prepayment percentage of loan during first twelve months of initial term | 15.00% | |||||
Capitalized costs associated with Loan | $ 6,900,000 | $ 6,900,000 | ||||
Loan, Outstanding principle balance | 847,244,000 | $ 847,244,000 | ||||
Fort Worth, Texas Residence Inn [Member] | ||||||
Mortgage Loans on Real Estate [Line Items] | ||||||
Loan, maturity date | Oct. 6, 2022 | |||||
Loan, interest rate | 4.73% | |||||
Mortgages Payable [Member] | ||||||
Mortgage Loans on Real Estate [Line Items] | ||||||
Borrowings on mortgage loan | $ 830,000,000 | |||||
Loans maturity, description | The Loan is scheduled to mature on December 9, 2016, with an option for the Borrowers to extend the initial term for three one-year extension terms, subject to certain conditions. | |||||
Mortgages Payable [Member] | Successor [Member] | ||||||
Mortgage Loans on Real Estate [Line Items] | ||||||
Amortization of deferred financing costs | 1,300,000 | $ 2,500,000 | ||||
Mortgages Payable [Member] | Fort Worth, Texas Residence Inn [Member] | ||||||
Mortgage Loans on Real Estate [Line Items] | ||||||
Loan, Outstanding principle balance | 17,200,000 | $ 17,200,000 | ||||
Mortgages Payable [Member] | LIBOR [Member] | ||||||
Mortgage Loans on Real Estate [Line Items] | ||||||
Margin rate | 2.80% | |||||
Interest Rate Cap [Member] | ||||||
Mortgage Loans on Real Estate [Line Items] | ||||||
Loan, maturity date | Dec. 9, 2016 | |||||
Net proceeds from borrowings on mortgage payable and mezzanine loans | $ 830,000,000 | $ 830,000,000 | ||||
Interest Rate Cap [Member] | One-Month LIBOR [Member] | ||||||
Mortgage Loans on Real Estate [Line Items] | ||||||
Margin rate | 4.50% | 4.50% | ||||
Mezzanine Loans [Member] | Year One [Member] | Minimum [Member] | ||||||
Mortgage Loans on Real Estate [Line Items] | ||||||
Debt yield | 7.50% | 7.50% | ||||
Mezzanine Loans [Member] | Year One [Member] | Maximum [Member] | ||||||
Mortgage Loans on Real Estate [Line Items] | ||||||
Debt yield | 7.50% | 7.50% | ||||
Mezzanine Loans [Member] | Year Two [Member] | Minimum [Member] | ||||||
Mortgage Loans on Real Estate [Line Items] | ||||||
Debt yield | 7.50% | 7.50% | ||||
Mezzanine Loans [Member] | Year Two [Member] | Maximum [Member] | ||||||
Mortgage Loans on Real Estate [Line Items] | ||||||
Debt yield | 7.50% | 7.50% | ||||
Mezzanine Loans [Member] | Year Three [Member] | Minimum [Member] | ||||||
Mortgage Loans on Real Estate [Line Items] | ||||||
Debt yield | 7.50% | 7.50% | ||||
Mezzanine Loans [Member] | Year Three [Member] | Maximum [Member] | ||||||
Mortgage Loans on Real Estate [Line Items] | ||||||
Debt yield | 7.50% | 7.50% | ||||
Mezzanine Loans [Member] | Year Four [Member] | Minimum [Member] | ||||||
Mortgage Loans on Real Estate [Line Items] | ||||||
Debt yield | 7.50% | 7.50% | ||||
Mezzanine Loans [Member] | Year Four [Member] | Maximum [Member] | ||||||
Mortgage Loans on Real Estate [Line Items] | ||||||
Debt yield | 7.50% | 7.50% | ||||
Mezzanine Loans [Member] | Year Five [Member] | Minimum [Member] | ||||||
Mortgage Loans on Real Estate [Line Items] | ||||||
Debt yield | 7.75% | 7.75% | ||||
Mezzanine Loans [Member] | Year Five [Member] | Maximum [Member] | ||||||
Mortgage Loans on Real Estate [Line Items] | ||||||
Debt yield | 7.75% | 7.75% | ||||
Mezzanine Loans [Member] | Successor [Member] | ||||||
Mortgage Loans on Real Estate [Line Items] | ||||||
Amortization of deferred financing costs | $ 1,400,000 | $ 2,700,000 |
Mortgages Payable - Schedule of
Mortgages Payable - Schedule of Future Principal Payments of Debt Obligations (Detail) $ in Thousands | Jun. 30, 2015USD ($) |
Debt Disclosure [Abstract] | |
2015 (remaining months) | $ 212 |
2,016 | 830,440 |
2,017 | 464 |
2,018 | 487 |
2,019 | 510 |
Thereafter | 15,131 |
Total | $ 847,244 |
Fair Value of Financial Instr28
Fair Value of Financial Instruments - Carrying Amounts and Estimated Fair Values of Financial Instruments (Detail) - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 | Jun. 30, 2014 | Dec. 31, 2013 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Cash and cash equivalents, Carrying Value | $ 34,091 | $ 22,776 | $ 25,061 | $ 23,902 |
Restricted cash, Carrying Value | 10,294 | 40,719 | ||
Due from third party managers, net, Carrying Value | 7,940 | 4,764 | ||
Accounts payable and accrued expenses, Carrying Value | 9,717 | 18,969 | ||
Due to third party managers, net, Carrying Value | 503 | 1,580 | ||
Mortgages payable, Carrying Value | 847,244 | 847,453 | ||
Cash and cash equivalents, Estimated Fair Value | 34,091 | 22,776 | ||
Restricted cash, Estimated Fair Value | 10,294 | 40,719 | ||
Due from third party managers, net, Estimated Fair Value | 7,940 | 4,764 | ||
Accounts payable and accrued expenses, Estimated Fair Value | 9,717 | 18,969 | ||
Due to third party managers, net, Estimated Fair Value | 503 | 1,580 | ||
Mortgages payable, Estimated Fair Value | 846,609 | 846,927 | ||
Fair Value, Measurements, Recurring [Member] | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Interest rate caps, Carrying Value | 6 | 59 | ||
Interest rate caps, Estimated Fair Value | $ 6 | $ 59 |
Fair Value of Financial Instr29
Fair Value of Financial Instruments - Additional Information (Detail) - Jun. 30, 2015 $ in Millions | USD ($)Agreement |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |
Number of interest rate cap agreement acquired | 1 |
Cash, cash equivalents and restricted cash, Maturity | Less than 90 days |
Interest Rate Cap [Member] | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |
Interest rate derivative instrument cost | $ | $ 0.3 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2015USD ($)Hotel | Jun. 30, 2014USD ($) | Jun. 30, 2015USD ($)PropertyHotel | Jun. 30, 2014USD ($) | Dec. 03, 2014Hotel | |
Long-term Purchase Commitment [Line Items] | |||||
Number of hotels owned | 62 | 62 | 62 | ||
Management agreement terms, description | The agreements with less than one year remaining in their term generally automatically renew on annual or month-to-month terms unless either party to the agreement gives prior notice of the termination thereof. | ||||
Number of subset of hotels with ground leases | 4 | 4 | |||
Ground lease expenses | $ | $ 100,000 | $ 100,000 | $ 100,000 | $ 100,000 | |
PA Residence Inn [Member] | |||||
Long-term Purchase Commitment [Line Items] | |||||
Lease obligation remaining period | 18 years | ||||
Management Agreements [Member] | |||||
Long-term Purchase Commitment [Line Items] | |||||
Number of hotels owned | 62 | 62 | |||
TRS Lease Agreements [Member] | |||||
Long-term Purchase Commitment [Line Items] | |||||
Rental income (expense), net | $ | $ 0 | ||||
Minimum [Member] | |||||
Long-term Purchase Commitment [Line Items] | |||||
Payment of management fee as percentage of revenues | 2.00% | ||||
Management agreement remaining terms, period | 1 year | ||||
Minimum [Member] | Franchise Agreements [Member] | |||||
Long-term Purchase Commitment [Line Items] | |||||
Royalty fee | 4.50% | ||||
Maximum [Member] | |||||
Long-term Purchase Commitment [Line Items] | |||||
Payment of management fee as percentage of revenues | 7.00% | ||||
Management agreement remaining terms, period | 19 years | ||||
Maximum [Member] | Franchise Agreements [Member] | |||||
Long-term Purchase Commitment [Line Items] | |||||
Royalty fee | 6.00% | ||||
Apple REIT Class Action Litigation [Member] | |||||
Long-term Purchase Commitment [Line Items] | |||||
Legal fees | 20.00% | ||||
Apple REIT Class Action Litigation [Member] | Other Parties [Member] | |||||
Long-term Purchase Commitment [Line Items] | |||||
Legal fees | 80.00% | ||||
Ground Leases [Member] | Courtyard and Fairfield Inn [Member] | |||||
Long-term Purchase Commitment [Line Items] | |||||
Number of properties leased under single ground lease | Property | 2 | ||||
Ground Leases [Member] | Minimum [Member] | |||||
Long-term Purchase Commitment [Line Items] | |||||
Lease obligation remaining period | 2 years | ||||
Ground Leases [Member] | Maximum [Member] | |||||
Long-term Purchase Commitment [Line Items] | |||||
Lease obligation remaining period | 8 years |
Commitments and Contingencies31
Commitments and Contingencies - Aggregate Amounts of Minimum Lease Payments under Lease Agreements (Detail) $ in Thousands | Jun. 30, 2015USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2015 (remaining months) | $ 137 |
2,016 | 275 |
2,017 | 240 |
2,018 | 206 |
2,019 | 99 |
Thereafter | 424 |
Total | $ 1,381 |
7% Series A Cumulative Redeem32
7% Series A Cumulative Redeemable Preferred Stock - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Millions | Sep. 30, 2013 | Mar. 31, 2015 | Jun. 30, 2015 | Dec. 31, 2014 | Nov. 29, 2012 |
Class of Stock [Line Items] | |||||
Number of preferred stock owned by company due to redemption | 0 | 0 | |||
7% Series A Cumulative Redeemable Preferred Stock [Member] | |||||
Class of Stock [Line Items] | |||||
Preferred stock, shares issued | 72,382,848 | 72,382,848 | 97,032,848 | ||
Initial date for redemption of shares | Nov. 14, 2020 | ||||
Preferred Stock, dividend rate | 7.00% | ||||
Increase in dividend rate of preferred stock per annum, if not paid in cash for more than six quarters | 9.00% | ||||
Increase in dividend rate of preferred stock if not redeemed after control events and May 14, 2018 | 11.00% | ||||
Increase in dividend rate, trigger date | May 14, 2018 | ||||
Preferred stock initial liquidation preference per share | $ 1.90 | $ 1.90 | |||
Date of merger agreement | Nov. 29, 2012 | ||||
Legacy litigation and regulatory matters, expense | $ 3.5 | ||||
Accrued dividend | $ 2.4 | ||||
7% Series A Cumulative Redeemable Preferred Stock [Member] | Installment 1, FY 2015 [Member] | |||||
Class of Stock [Line Items] | |||||
Preferred Stock, dividend declared per share | $ 0.0333 | ||||
Dividend payable, date paid or to be paid | Apr. 15, 2015 | ||||
Preferred Stock, dividend record date | Apr. 1, 2015 | ||||
Dividend payable, date declared | Mar. 31, 2015 | ||||
7% Series A Cumulative Redeemable Preferred Stock [Member] | Installment 2, FY 2015 [Member] | |||||
Class of Stock [Line Items] | |||||
Preferred Stock, dividend declared per share | $ 0.0333 | ||||
Dividend payable, date paid or to be paid | Jul. 15, 2015 | ||||
Preferred Stock, dividend record date | Jul. 1, 2015 | ||||
Dividend payable, date declared | Jun. 30, 2015 | ||||
Series A Preferred Stock [Member] | |||||
Class of Stock [Line Items] | |||||
Redemption of Series A Preferred Stock | $ 47.5 | ||||
Number of preferred stock redeemed | 24,650,000 | ||||
Redemption price per share | $ 1.9281 | ||||
Accumulated and unpaid dividends earned per share | $ 0.0281 | ||||
Series A Preferred Stock [Member] | BRE Holdings [Member] | |||||
Class of Stock [Line Items] | |||||
Preferred Stock tender offer number of shares | 2,000,000 | ||||
Preferred Stock, purchase price | $ 1.30 | ||||
Number of preferred stock owned by company due to redemption | 1,500,000 |
Shareholders' Equity - Addition
Shareholders' Equity - Additional Information (Detail) - $ / shares | May. 11, 2015 | Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Dec. 31, 2014 |
Class of Stock [Line Items] | ||||||
Capital stock, shares authorized | 150,100,000 | 150,100,000 | ||||
Common stock, par value | $ 0.01 | $ 0.01 | $ 0.01 | |||
Preferred stock, par value | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||
Common stock voting rights | Company's common stock are entitled to one vote for each share of common stock. | |||||
Common stock, shares outstanding | 100 | 100 | 100 | |||
Common stock, shares issued | 100 | 100 | 100 | |||
Common Stock, dividend declared per share | $ 90,000 | $ 90,000 | $ 90,000 | $ 90,000 | ||
Common Stock [Member] | ||||||
Class of Stock [Line Items] | ||||||
Capital stock, shares authorized | 100,000 | 100,000 | ||||
Dividend payable, date declared | May 11, 2015 | |||||
Dividend payable, date to be paid | May 13, 2015 | |||||
Common Stock, dividend declared per share | $ 90,000 | |||||
Preferred Stock [Member] | ||||||
Class of Stock [Line Items] | ||||||
Capital stock, shares authorized | 150,000,000 | 150,000,000 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Income Tax Disclosure [Abstract] | ||||
Income tax expense | $ (1,925) | $ (1,749) | $ (202) | $ (814) |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Detail) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2015USD ($)Hotel | Jun. 30, 2014USD ($) | Jun. 30, 2015USD ($)Hotel | Jun. 30, 2014USD ($) | Dec. 31, 2014USD ($) | Dec. 03, 2014Hotel | |
Related Party Transaction [Line Items] | ||||||
Number of hotels owned | Hotel | 62 | 62 | 62 | |||
Capital improvements payable | $ 503 | $ 503 | $ 1,580 | |||
Professional fees paid to management company | 300 | $ 200 | 800 | $ 400 | ||
Management Company [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Capital improvements payable | 200 | 200 | 0 | |||
Hilton Worldwide, Inc. [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Franchise fees, marketing fees, and other expenses | 4,600 | 4,000 | 8,500 | 7,500 | ||
Amount paid for capital improvements | 300 | $ 0 | 3,100 | $ 0 | ||
Capital improvements payable | $ 0 | $ 0 | $ 1,200 | |||
Hilton Worldwide Holdings Inc. Franchisor [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Number of hotels owned | Hotel | 27 | 27 |
Discontinued Operations - Summa
Discontinued Operations - Summary of Hotels Sold (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended |
Jun. 30, 2014 | Jun. 30, 2014 | Dec. 31, 2014 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Gain/(Loss) from sale of hotels | $ 81 | $ 81 | $ (150) |
Net Proceeds from sale of hotels | $ 9,380 | ||
Fairfield Inn - Orange Park, Florida [Member] | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Hotels sale date | Apr. 23, 2014 | ||
Gain/(Loss) from sale of hotels | $ (67) | ||
Net Proceeds from sale of hotels | $ 2,978 | ||
Fairfield Inn - Birmingham, Alabama [Member] | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Hotels sale date | May 8, 2014 | ||
Gain/(Loss) from sale of hotels | $ 223 | ||
Net Proceeds from sale of hotels | $ 1,509 | ||
SpringHill Suites - Savannah, Georgia [Member] | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Hotels sale date | Jun. 2, 2014 | ||
Gain/(Loss) from sale of hotels | $ (285) | ||
Net Proceeds from sale of hotels | $ 3,405 | ||
SpringHill Suites - Montgomery, Alabama [Member] | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Hotels sale date | Sep. 4, 2014 | ||
Gain/(Loss) from sale of hotels | $ (21) | ||
Net Proceeds from sale of hotels | $ 1,488 |
Discontinued Operations - Opera
Discontinued Operations - Operating Results from Discontinued Operations (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Dec. 31, 2014 | |
Discontinued Operations and Disposal Groups [Abstract] | |||||
Total revenue | $ 941 | $ 2,225 | |||
Hotel operating expenses | 724 | 1,716 | |||
Taxes, insurance and other | 29 | 132 | |||
General and administrative | 23 | 58 | |||
Interest expense | 181 | 301 | |||
Income tax expense | 63 | 30 | |||
Gain from hotel dispositions | 81 | 81 | $ (150) | ||
Income from discontinued operations | $ 0 | $ 2 | $ 0 | $ 69 |