Apple Hospitality REIT Results

Apple Hospitality REIT Reports Results of Operations for First Quarter 2017

Net income per share down 25 percent

Apple Hospitality REIT, Inc. (NYSE: APLE) yesterday announced results of operations for the first quarter of 2017.

 
Selected Statistical and Financial Data
As of and For the Three Months Ended March 31

(Unaudited) (in thousands, except statistical and per share amounts)(1)

   
Three Months Ended
March 31,
2017   2016 % Change
 
Net income $ 34,365 $ 34,686 (0.9%)
Net income per share $ 0.15 $ 0.20 (25.0%)
 
Adjusted EBITDA $ 99,078 $ 78,610 26.0%
Comparable Hotels Adjusted Hotel EBITDA $ 104,771 $ 106,738 (1.8%)
Comparable Hotels Adjusted Hotel EBITDA Margin 36.2% 37.5% (130 bps)
Modified funds from operations (MFFO) $ 86,881 $ 69,314 25.3%
MFFO per share $ 0.39 $ 0.40 (2.5%)
 
ADR (Actual) $ 133.39 $ 133.16 0.2%
Occupancy (Actual) 74.4% 74.1% 0.4%
RevPAR (Actual) $ 99.27 $ 98.66 0.6%
 
Comparable Hotels ADR $ 133.09 $ 132.66 0.3%
Comparable Hotels Occupancy 74.4% 73.6% 1.1%
Comparable Hotels RevPAR $ 99.02 $ 97.65 1.4%
 
Distributions paid $ 66,908 $ 52,360 27.8%
Distributions paid per share $ 0.30 $ 0.30 -
 
Total debt outstanding $ 1,404,079
Total debt to total capitalization (2) 24.8%
 

(1)

 

Explanations of and reconciliations to Net Income of Adjusted EBITDA, Comparable Hotels Adjusted Hotel EBITDA and MFFO are included below.

(2)

Total debt outstanding divided by total debt outstanding plus equity market capitalization based on the Company’s closing share price at March 31, 2017 of $19.10.

 

Comparable Hotels is defined as the 235 hotels owned by the Company as of March 31, 2017, that are held for use, and excludes the Dallas Hilton hotel that was sold in April 2017. For hotels acquired during the periods noted, the Company has included, as applicable, results of those hotels for periods prior to the Company's ownership, and for dispositions, results have been excluded for the Company's period of ownership. Results for periods prior to the Company's ownership have not been included in the Company's actual Consolidated Financial Statements and are included only for comparison purposes. Results included for periods prior to the Company's ownership are based on information from the prior owner of each hotel and have not been audited or adjusted.

Justin Knight, President and Chief Executive Officer, commented, “We are pleased with our results for the first quarter, which highlight the benefits of our broad geographic diversification. Comparable Hotels RevPAR grew by 1.4 percent, in line with our expectations, despite a 16 percent decline in Los Angeles, one of our largest markets, due to the outsized growth from the Porter Ranch gas leak in 2016. We continue to believe that our large, geographically diversified, upscale portfolio of Marriott and Hilton branded hotels and our strong, flexible balance sheet position us well as we continue throughout the year.”

Hotel Portfolio Overview

Apple Hospitality owns a highly diversified hotel portfolio, which helps insulate the revenue stream of the Company from regional economic dislocations that may occur from time to time. As of March 31, 2017, Apple Hospitality owned 236 hotels with 30,203 rooms, comprised of 116 Marriott® branded hotels and 120 Hilton® branded hotels, with locations in 87 markets throughout 33 states.

Transactional Activity

Acquisitions

The Company acquired the newly constructed 124-room Courtyard by Marriott® Fort Worth Historic Stockyards on February 2, 2017, for a purchase price of approximately $18 million.

Effective September 1, 2016, Apple Hospitality completed its merger with Apple REIT Ten, Inc. (“Apple Ten”). The merger added 56 Marriott® and Hilton® branded primarily select service and extended stay hotels with 7,209 guestrooms to the Company’s portfolio. As consideration in the merger, the Company issued approximately 49 million common shares and paid approximately $94 million to the Apple Ten shareholders, and assumed approximately $257 million of debt.

Dispositions

On April 20, 2017, Apple Hospitality completed the sale of its 224-room Hilton® hotel in Dallas, Texas, for a gross sales price of approximately $56 million, including debt assumed by the buyer of approximately $27 million. The estimated gain on sale of the Dallas Hilton® is approximately $16 million, which will be recognized during the second quarter of 2017.

In April 2017, the Company entered into contracts for the sale of two properties in Columbus, Georgia, the SpringHill Suites by Marriott® and the TownePlace Suites by Marriott®, for a total gross sales price of approximately $10 million. Due to the change in the anticipated hold period of each of these hotels, the Company recognized an impairment loss of approximately $8 million during the first quarter of 2017, to adjust the bases of these properties to their estimated fair values. The sales remain subject to a number of conditions to closing and therefore there can be no assurance that a closing will occur. If closing conditions are met, these sales are expected to be completed within six months of March 31, 2017.

Capital Improvements

Apple Hospitality consistently reinvests in its hotels to maintain and enhance each property’s relevance and competitive position within its respective market. During the three months ended March 31, 2017, the Company invested approximately $13 million in capital expenditures for existing hotels. The Company plans to continue to reinvest in its hotels and anticipates investing an additional $50 to $60 million in capital improvements during the remainder of 2017, which includes various scheduled renovation projects for approximately 20 to 25 properties.

Balance Sheet

As of March 31, 2017, Apple Hospitality had approximately $1.4 billion of total indebtedness with a current combined weighted average interest rate of approximately 3.3 percent for the remainder of 2017. Excluding unamortized debt issuance costs and fair value adjustments, the Company’s total indebtedness is comprised of approximately $462 million in property-level debt secured by 29 hotels, and $942 million outstanding on its unsecured credit facilities. Apple Hospitality’s undrawn capacity on its unsecured credit facilities at March 31, 2017 was approximately $173 million. The Company’s total debt to total capitalization at March 31, 2017 was approximately 25 percent, which provides Apple Hospitality with financial flexibility to fund capital requirements and pursue opportunities in the marketplace.

Shareholder Distributions

Apple Hospitality paid distributions of $0.30 per common share during the three-month period ended March 31, 2017. Based on the Company’s common share closing price of $19.00 on May 2, 2017, the annualized distribution of $1.20 per common share represents an annual yield of approximately 6.3 percent. The Company’s Board of Directors, in consultation with management, will continue to regularly monitor the Company’s distribution rate relative to the performance of its hotels, capital improvement needs, varying economic cycles, acquisitions, and dispositions. At its discretion, the Company’s Board of Directors may make adjustments as determined to be prudent in relation to other cash requirements of the Company.

2017 Outlook

Apple Hospitality is providing its operational and financial outlook for 2017. This outlook, which is based on management’s current view of both operating and economic fundamentals of the Company’s existing portfolio of hotels, does not take into account any unanticipated developments in its business or changes in its operating environment, nor does it take into account any unannounced hotel acquisitions or dispositions. Comparable Hotels RevPAR Growth and Comparable Hotels Adjusted EBITDA Margin % guidance include properties acquired, including those acquired through the Apple Ten merger, as if the hotels were owned as of January 1, 2016, and exclude dispositions since January 1, 2016, and hotels under contract for disposition. For the full year 2017, the Company anticipates:

         
        2017 Guidance(1)
        Low-End   High-End
             
Net income   $209 Million   $232 Million
         
Comparable Hotels RevPAR Growth   0.0%   2.0%
         
Comparable Hotels Adjusted EBITDA Margin %   37.3%   38.3%
         
Adjusted EBITDA   $430 Million   $450 Million
         
(1)   Explanations of and reconciliations to Net income guidance of Adjusted EBITDA guidance are included below.
     

About Apple Hospitality REIT, Inc.

Apple Hospitality REIT, Inc. (NYSE: APLE) is a publicly traded real estate investment trust (REIT) that owns one of the largest portfolios of upscale, select service hotels in the United States. The Company’s portfolio consists of 235 hotels, with approximately 30,000 guestrooms, diversified across the Hilton® and Marriott® families of brands with locations in urban, high-end suburban and developing markets throughout 33 states. 

   
Apple Hospitality REIT, Inc.
Consolidated Balance Sheets
(in thousands, except share data)
 
 
March 31, December 31,
2017 2016
(unaudited)
Assets

Investment in real estate, net of accumulated depreciation of $601,055 and $557,597, respectively

$ 4,803,503 $ 4,823,489
Assets held for sale 39,000 39,000
Restricted cash-furniture, fixtures and other escrows 27,309 29,425
Due from third party managers, net 57,692 31,460
Other assets, net   47,419     56,509  
Total Assets $ 4,974,923   $ 4,979,883  
 
Liabilities
Revolving credit facility $ 366,600 $ 270,000
Term loans 571,197 570,934
Mortgage debt 465,043 497,029
Accounts payable and other liabilities   84,237     124,856  
Total Liabilities 1,487,077 1,462,819
 
Shareholders' Equity

Preferred stock, authorized 30,000,000 shares; none issued and outstanding

-

-

Common stock, no par value, authorized 800,000,000 shares; issued and outstanding 223,049,990 and 222,938,648 shares, respectively

4,454,992 4,453,205
Accumulated other comprehensive income 6,134 4,589
Distributions greater than net income   (973,280 )   (940,730 )
Total Shareholders' Equity   3,487,846     3,517,064  
 
Total Liabilities and Shareholders' Equity $ 4,974,923   $ 4,979,883  
 
   
Apple Hospitality REIT, Inc.
Consolidated Statements of Operations and Comprehensive Income
(Unaudited) (in thousands, except per share data)
 
 
Three Months Ended
March 31,
2017 2016
Revenues:
Room $ 269,393 $ 206,150
Other   23,532     18,337  
Total revenue 292,925 224,487
 
Expenses:
Operating 75,154 56,829
Hotel administrative 24,836 18,198
Sales and marketing 24,109 18,019
Utilities 9,753 7,600
Repair and maintenance 11,916 9,084
Franchise fees 12,474 9,445
Management fees 10,212 8,037
Property taxes, insurance and other 16,927 12,452
Ground lease 2,816 2,466
General and administrative 6,754 4,828
Transaction and litigation costs - 293
Loss on impairment of depreciable real estate assets 7,875 -
Depreciation   43,767     33,484  
Total expenses   246,593     180,735  
 
Operating income 46,332 43,752
 
Interest and other expense, net   (11,717 )   (8,803 )
 
Income before income taxes 34,615 34,949
 
Income tax expense   (250 )   (263 )
 
Net income $ 34,365   $ 34,686  
 
Other comprehensive income (loss):
Interest rate derivatives   1,545     (6,694 )
 
Comprehensive income $ 35,910   $ 27,992  
 
Basic and diluted net income per common share $ 0.15   $ 0.20  
 
Weighted average common shares outstanding - basic and diluted 223,047 174,666
 
 
Apple Hospitality REIT, Inc.
Comparable Hotels Operating Metrics and Statistical Data

(Unaudited) (in thousands except statistical data)

     
Three Months Ended
March 31,
2017 2016 % Change
 
Room revenue $ 266,735 $ 262,733 1.5%
Other revenue   22,456     22,187   1.2%
Total revenue 289,191 284,920 1.5%
 
Total operating expenses   184,420     178,182   3.5%
 
Adjusted Hotel EBITDA $ 104,771   $ 106,738   (1.8%)
Adjusted Hotel EBITDA Margin % 36.2 % 37.5 % (130 bps)
 
 
ADR (Comparable Hotels) $ 133.09 $ 132.66 0.3%
Occupancy (Comparable Hotels) 74.4 % 73.6 % 1.1%
RevPAR (Comparable Hotels) $ 99.02 $ 97.65 1.4%
 
ADR (Actual) $ 133.39 $ 133.16 0.2%
Occupancy (Actual) 74.4 % 74.1 % 0.4%
RevPAR (Actual) $ 99.27 $ 98.66 0.6%
 

Reconciliation to Actual Results

 
Total Revenue (Actual) $ 292,925 $ 224,487
Revenue from acquisitions prior to ownership - 65,479
Revenue from dispositions (3,687 ) (5,143 )
Lease revenue intangible amortization   (47 )   97  
Comparable Hotels Total Revenue $ 289,191   $ 284,920  
 
Adjusted Hotel EBITDA (AHEBITDA) (Actual) $ 105,832 $ 83,438
AHEBITDA from acquisitions prior to ownership - 24,494
AHEBITDA from dispositions   (1,061 )   (1,194 )
Comparable Hotels AHEBITDA $ 104,771   $ 106,738  
 

Note:

Comparable Hotels is defined as the 235 hotels owned by the Company as of March 31, 2017, that are held for use, and excludes the Dallas Hilton hotel that was sold in April 2017. For hotels acquired during the periods noted, the Company has included, as applicable, results of those hotels for periods prior to the Company's ownership, and for dispositions, results have been excluded for the Company's period of ownership. Results for periods prior to the Company's ownership have not been included in the Company's actual Consolidated Financial Statements and are included only for comparison purposes. Results included for periods prior to the Company's ownership are based on information from the prior owner of each hotel and have not been audited or adjusted.

 

Reconciliation of Net Income to Non-GAAP financial measures is included in the following pages.

 
 
Apple Hospitality REIT, Inc.
Comparable Hotels Quarterly Operating Metrics and Statistical Data

(Unaudited) (in thousands except statistical data)

               
Three Months Ended
6/30/2015 9/30/2015 12/31/2015 3/31/2016 6/30/2016 9/30/2016 12/31/2016 3/31/2017
 
Room revenue $ 285,907 $ 287,714 $ 246,492 $ 262,733 $ 303,305 $ 296,647 $ 253,823 $ 266,735
Other revenue   24,425     22,939     23,654     22,187     24,501     23,563     23,563     22,456  
Total revenue 310,332 310,653 270,146 284,920 327,806 320,210 277,386 289,191
 
Total operating expenses   183,568     185,833     173,972     178,182     191,840     196,002     179,266     184,420  
 
Adjusted Hotel EBITDA $ 126,764   $ 124,820   $ 96,174   $ 106,738   $ 135,966   $ 124,208   $ 98,120   $ 104,771  
Adjusted Hotel EBITDA Margin % 40.8 % 40.2 % 35.6 % 37.5 % 41.5 % 38.8 % 35.4 % 36.2 %
 
 
ADR (Comparable Hotels) $ 131.47 $ 132.53 $ 126.59 $ 132.66 $ 137.08 $ 134.79 $ 127.71 $ 133.09
Occupancy (Comparable Hotels) 81.7 % 80.3 % 71.7 % 73.6 % 81.9 % 80.1 % 72.4 % 74.4 %
RevPAR (Comparable Hotels) $ 107.46 $ 106.47 $ 90.73 $ 97.65 $ 112.27 $ 108.03 $ 92.43 $ 99.02
 
ADR (Actual) $ 131.33 $ 133.18 $ 127.04 $ 133.16 $ 138.16 $ 136.04 $ 127.81 $ 133.39
Occupancy (Actual) 81.8 % 80.5 % 71.9 % 74.1 % 82.2 % 80.2 % 72.4 % 74.4 %
RevPAR (Actual) $ 107.43 $ 107.19 $ 91.36 $ 98.66 $ 113.59 $ 109.07 $ 92.52 $ 99.27
 

Reconciliation to Actual Results

 
Total Revenue (Actual) $ 234,374 $ 240,555 $ 213,033 $ 224,487 $ 257,636 $ 276,471 $ 282,431 $ 292,925
Revenue from acquisitions prior to ownership 81,734 75,548 62,799 65,479 76,234 49,452 - -
Revenue from dispositions (5,743 ) (5,417 ) (5,653 ) (5,143 ) (6,017 ) (5,666 ) (4,998 ) (3,687 )
Lease revenue intangible amortization   (33 )   (33 )   (33 )   97     (47 )   (47 )   (47 )   (47 )
Comparable Hotels Total Revenue $ 310,332   $ 310,653   $ 270,146   $ 284,920   $ 327,806   $ 320,210   $ 277,386   $ 289,191  
 
Adjusted Hotel EBITDA (AHEBITDA) (Actual) $ 93,805 $ 95,738 $ 74,790 $ 83,438 $ 105,574 $ 106,707 $ 99,291 $ 105,832
AHEBITDA from acquisitions prior to ownership 34,335 30,557 22,825 24,494 32,073 18,985 - -
AHEBITDA from dispositions   (1,376 )   (1,475 )   (1,441 )   (1,194 )   (1,681 )   (1,484 )   (1,171 )   (1,061 )
Comparable Hotels AHEBITDA $ 126,764   $ 124,820   $ 96,174   $ 106,738   $ 135,966   $ 124,208   $ 98,120   $ 104,771  
 

Note:

Comparable Hotels is defined as the 235 hotels owned by the Company as of March 31, 2017, that are held for use, and excludes the Dallas Hilton hotel that was sold in April 2017. For hotels acquired during the periods noted, the Company has included, as applicable, results of those hotels for periods prior to the Company's ownership, and for dispositions, results have been excluded for the Company's period of ownership. Results for periods prior to the Company's ownership have not been included in the Company's actual Consolidated Financial Statements and are included only for comparison purposes. Results included for periods prior to the Company's ownership are based on information from the prior owner of each hotel and have not been audited or adjusted.

 

Reconciliation of Net Income to Non-GAAP financial measures is included in the following pages.

 

Apple Hospitality REIT, Inc.

Reconciliation of Net Income (Loss) to EBITDA, Adjusted EBITDA and Adjusted Hotel EBITDA

(Unaudited) (in thousands)

EBITDA is a commonly used measure of performance in many industries and is defined as net income (loss) excluding interest, income taxes, depreciation and amortization. The Company believes EBITDA is useful to investors because it helps the Company and its investors evaluate the ongoing operating performance of the Company by removing the impact of its capital structure (primarily interest expense) and its asset base (primarily depreciation and amortization). In addition, certain covenants included in the agreements governing the Company’s indebtedness use EBITDA, as defined in the specific credit agreement, as a measure of financial compliance.

The Company considers the exclusion or inclusion of certain additional items from EBITDA (Adjusted EBITDA) useful, including (i) the exclusion of transaction and litigation costs, gains or losses from sales of real estate, and the loss on impairment of depreciable real estate assets, as these items do not represent ongoing operations, and (ii) the exclusion of non-cash straight-line ground lease expense, as this expense does not reflect the underlying performance of the related hotels.

The Company further excludes actual corporate-level general and administrative expense for the Company from Adjusted EBITDA (Adjusted Hotel EBITDA) to isolate property-level operational performance over which the Company’s hotel operators have direct control. The Company believes Adjusted Hotel EBITDA provides useful supplemental information to investors regarding operating performance, and is used by management to measure the performance of the Company’s hotels and effectiveness of the operators of the hotels.

The following table reconciles the Company’s GAAP net income (loss) to EBITDA, Adjusted EBITDA and Adjusted Hotel EBITDA on a quarterly basis from June 30, 2015, through March 31, 2017.

 
Three Months Ended
6/30/2015   9/30/2015   12/31/2015   3/31/2016   6/30/2016   9/30/2016   12/31/2016   3/31/2017
Net income (loss) $ 44,245 $ 46,968 $ (17,792 ) $ 34,686 $ 54,718 $ 13,694 $ 41,554 $ 34,365
Depreciation 31,135 32,351 33,244 33,484 33,824 37,343 43,512 43,767
Amortization of favorable and unfavorable leases, net 133 133 133 262 119 132 161 165
Interest and other expense, net 7,226 9,302 8,867 8,803 9,560 10,156 11,507 11,717
Income tax (benefit) expense   422   138   26     263   360   (7 )   (185 )   250
EBITDA 83,161 88,892 24,478 77,498 98,581 61,318 96,549 90,264
Transaction and litigation costs 5,825 842 (710 ) 293 1,116 36,452 (2,872 ) -
Loss on sale of real estate 271 - 72 - - - 153 -
Loss on impairment of depreciable real estate assets - - 45,000 - - 5,471 - 7,875
Non-cash straight-line ground lease expense   849   829   819     819   817   843     940     939
Adjusted EBITDA $ 90,106 $ 90,563 $ 69,659   $ 78,610 $ 100,514 $ 104,084   $ 94,770   $ 99,078
General and administrative expense   3,699   5,175   5,131     4,828   5,060   2,623     4,521     6,754
Adjusted Hotel EBITDA $ 93,805 $ 95,738 $ 74,790   $ 83,438 $ 105,574 $ 106,707   $ 99,291   $ 105,832
 

Apple Hospitality REIT, Inc.

2017 Guidance Reconciliation of Net Income to EBITDA and Adjusted EBITDA

(Unaudited) (in thousands)

The guidance of Net Income, EBITDA and Adjusted EBITDA, are forward-looking statements and are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors which may cause actual results and performance to differ materially from those expressed or implied by these forecasts. Although the Company believes the expectations reflected in the forecasts are based upon reasonable assumptions, there can be no assurance that the expectations will be achieved or that the results will not be materially different. Risks that may affect these assumptions and forecasts include, but are not limited to the following: changes in political, economic, competitive and specific market conditions; the amount and timing of acquisitions and dispositions of hotel properties; the level of capital expenditures may change significantly, which will directly affect the level of depreciation expense, interest expense and net income; the amount and timing of debt repayments may change significantly based on market conditions, which will directly affect the level of interest expense and net income; the amount and timing of transactions involving shares of the Company's common stock may change based on market conditions; and other risks and uncertainties associated with the Company's business described herein and in filings with the Securities and Exchange Commission, including the Company's Annual Report on Form 10-K for the year ended December 31, 2016.

 

  Year Ended December 31, 2017
Low-End   High-End
Net income $ 209,000 $ 232,000
Depreciation 175,800 174,300
Amortization of favorable and unfavorable leases, net 625 625
Interest and other expense, net 48,000 46,000
Income tax expense   1,000     1,500  
EBITDA 434,425 454,425
Gain on sale of real estate (16,000 ) (16,000 )
Loss on impairment of depreciable real estate assets 7,875 7,875
Non-cash straight-line ground lease expense   3,700     3,700  
Adjusted EBITDA $ 430,000   $ 450,000  
 

Apple Hospitality REIT, Inc.

Reconciliation of Net Income to FFO and MFFO

(Unaudited) (in thousands)

The Company calculates and presents FFO in accordance with standards established by the National Association of Real Estate Investment Trusts (“NAREIT”), which defines FFO as net income (computed in accordance with generally accepted accounting principles (“GAAP”)), excluding gains or losses from sales of real estate, extraordinary items as defined by GAAP, the cumulative effect of changes in accounting principles, plus real estate related depreciation, amortization and impairments, and adjustments for unconsolidated partnerships and joint ventures. Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values instead have historically risen or fallen with market conditions, most real estate industry investors consider FFO to be helpful in evaluating a real estate company’s operations. The Company further believes that by excluding the effects of these items, FFO is useful to investors in comparing its operating performance between periods and between REITs that report FFO using the NAREIT definition. FFO as presented by the Company is applicable only to its common shareholders, but does not represent an amount that accrues directly to common shareholders.

The Company further adjusts FFO (MFFO) for certain additional items that are not in NAREIT’s definition of FFO, including: (i) the exclusion of transaction and litigation costs, as these costs do not represent ongoing operations, and (ii) the exclusion of non-cash straight-line ground lease expense, as this expense does not reflect the underlying performance of the related hotels. The Company presents MFFO when evaluating its performance because it believes that it provides further useful supplemental information to investors regarding its ongoing operating performance.

The following table reconciles the Company’s GAAP net income to FFO and MFFO for the three months ended March 31, 2017 and 2016.

 
Three Months Ended
March 31,
2017   2016
Net income $ 34,365 $ 34,686
Depreciation of real estate owned 43,537 33,254
Loss on impairment of depreciable real estate assets 7,875 -
Amortization of favorable and unfavorable leases, net   165   262
Funds from operations 85,942 68,202
Transaction and litigation costs - 293
Non-cash straight-line ground lease expense   939   819
Modified funds from operations $ 86,881 $ 69,314
 
 

Apple Hospitality REIT, Inc.

Debt Summary
(Unaudited) ($ in thousands)
March 31, 2017
               

April 1 -

December 31,

2017

2018 2019 2020 2021 Thereafter Total

Fair Market

Value

Total debt:
Maturities $ 8,325 $ 11,620 $ 398,879 $ 451,758 $ 95,928 $ 437,569 $ 1,404,079 $ 1,398,136
Average interest rates 3.3 % 3.3 % 3.4 % 3.7 % 4.0 % 4.0 %
 
Variable rate debt:
Maturities $ - $ - $ 366,600 $ 425,000 $ 50,000 $ 100,000 $ 941,600 $ 942,547
Average interest rates (1) 2.8 % 2.8 % 2.8 % 2.9 % 3.0 % 3.1 %
 
Fixed rate debt:
Maturities $ 8,325 $ 11,620 $ 32,279 $ 26,758 $ 45,928 $ 337,569 $ 462,479 $ 455,589
Average interest rates 4.5 % 4.5 % 4.5 % 4.5 % 4.4 % 4.3 %
________
(1) The average interest rate gives effect to interest rate swaps, as applicable.
 
 
Apple Hospitality REIT, Inc.

Comparable Hotels Operating Metrics Top 20 Markets(1)

Three Months ended March 31
(Unaudited)
         
Top 20 Markets       Occupancy   ADR   RevPAR  

% of Adjusted

Hotel EBITDA

# of Hotels Q1 2017   Q1 2016   % Change Q1 2017   Q1 2016   % Change Q1 2017   Q1 2016   % Change Q1 2017
Top 20 Markets            
Phoenix, AZ 8 81.9% 80.0% 2.4% $162.10 $157.34 3.0% $132.79 $125.86 5.5% 6.3%
Los Angeles/Long Beach, CA 8 87.5% 94.2% (7.1)% $160.59 $178.33 (9.9)% $140.58 $167.96 (16.3)% 6.2%
San Diego, CA 7 80.3% 74.4% 7.9% $149.53 $142.56 4.9% $120.00 $106.07 13.1% 5.6%
Anaheim/Santa Ana, CA 6 85.2% 85.6% (0.4)% $147.66 $142.79 3.4% $125.77 $122.17 3.0% 4.4%
Dallas, TX 9 75.5% 77.4% (2.5)% $121.91 $121.32 0.5% $92.07 $93.94 (2.0)% 3.8%
Nashville, TN 5 74.0% 82.2% (9.9)% $162.33 $160.96 0.9% $120.17 $132.26 (9.1)% 3.4%
Richmond/Petersburg, VA 4 73.0% 69.2% 5.4% $149.93 $146.13 2.6% $109.38 $101.10 8.2% 3.2%
Austin, TX 7 77.0% 77.1% (0.1)% $132.88 $135.51 (1.9)% $102.32 $104.49 (2.1)% 3.1%
Fort Lauderdale, FL 3 89.2% 90.1% (0.9)% $180.67 $181.36 (0.4)% $161.22 $163.39 (1.3)% 2.9%
Miami/Hialeah, FL 3 88.2% 90.6% (2.6)% $177.14 $193.70 (8.6)% $156.31 $175.48 (10.9)% 2.7%
Seattle, WA 3 75.2% 75.0% 0.2% $169.63 $157.73 7.5% $127.52 $118.30 7.8% 2.2%
Houston, TX 6 66.8% 64.3% 3.9% $124.93 $131.44 (4.9)% $83.41 $84.46 (1.2)% 2.2%
Orlando, FL 3 88.5% 92.5% (4.4)% $133.16 $127.27 4.6% $117.82 $117.76 0.0% 2.0%
Washington, DC-MD-VA 5 61.7% 65.5% (5.8)% $134.49 $125.24 7.4% $83.03 $82.08 1.2% 2.0%
Oklahoma City, OK 4 76.1% 77.0% (1.1)% $133.68 $134.19 (0.4)% $101.78 $103.29 (1.5)% 1.9%
Denver, CO 3 73.2% 68.5% 6.9% $140.39 $141.20 (0.6)% $102.81 $96.76 6.3% 1.8%
Chicago, IL 8 62.9% 60.0% 5.0% $114.91 $119.22 (3.6)% $72.32 $71.49 1.2% 1.8%
Fort Worth/Arlington, TX 5 72.4% 81.1% (10.8)% $129.06 $122.15 5.7% $93.38 $99.12 (5.8)% 1.7%
Idaho 2 77.2% 76.0% 1.6% $125.42 $119.95 4.6% $96.84 $91.13 6.3% 1.6%
Tucson, AZ 3 88.2%   89.2%   (1.2)% $120.68   $112.95   6.8% $106.43   $100.80   5.6% 1.6%
Top 20 Markets 102 76.6%   77.0%   (0.5)% $143.10   $143.07   0.0% $109.62   $110.17   (0.5)% 60.4%
                                 
All Other Markets 133 72.3%   70.2%   2.9% $122.72   $121.36   1.1% $88.67   $85.26   4.0% 39.6%
 
                                             
Total Portfolio   235   74.4%   73.6%   1.1%   $133.09   $132.66   0.3%   $99.02   $97.65   1.4%   100.0%
 
 
Apple Hospitality REIT, Inc.
Comparable Hotels Operating Metrics by Region
Three Months ended March 31
(Unaudited)
         
Region       Occupancy   ADR   RevPAR  

% of Adjusted

Hotel EBITDA

# of Hotels Q1 2017   Q1 2016   % Change Q1 2017   Q1 2016   % Change Q1 2017   Q1 2016   % Change   Q1 2017
STR Region            
East North Central 15 64.8% 62.7% 3.3% $118.21 $120.15 (1.6)% $76.62 $75.36 1.7% 4.1%
East South Central 27 73.5% 72.9% 0.9% $123.12 $123.63 (0.4)% $90.52 $90.07 0.5% 8.6%
Middle Atlantic 12 69.7% 67.9% 2.7% $142.24 $149.90 (5.1)% $99.21 $101.84 (2.6)% 1.8%
Mountain 19 79.6% 77.1% 3.2% $140.54 $135.59 3.6% $111.88 $104.55 7.0% 12.4%
New England 4 61.4% 69.6% (11.7)% $126.26 $126.16 0.1% $77.57 $87.81 (11.7)% 0.9%
Pacific 32 82.6% 81.3% 1.6% $154.71 $155.23 (0.3)% $127.81 $126.27 1.2% 22.5%
South Atlantic 63 75.3% 74.9% 0.5% $131.97 $130.20 1.4% $99.39 $97.53 1.9% 27.5%
West North Central 17 69.6% 66.4% 4.9% $117.07 $116.17 0.8% $81.48 $77.10 5.7% 4.8%
West South Central 46 72.5% 73.3% (1.2)% $124.82 $124.41 0.3% $90.45 $91.23 (0.9)% 17.4%
                                             
Total Portfolio   235   74.4%   73.6%   1.1%   $133.09   $132.66   0.3%   $99.02   $97.65   1.4%   100.0%
 

Note:  Region categorization is based on STR, Inc. designation.

 
 
 
Apple Hospitality REIT, Inc.
Comparable Hotels Operating Metrics by Location
Three Months ended March 31
(Unaudited)
 
Location       Occupancy   ADR   RevPAR  

% of Adjusted

Hotel EBITDA

# of Hotels Q1 2017   Q1 2016   % Change Q1 2017   Q1 2016   % Change Q1 2017   Q1 2016   % Change Q1 2017
STR Location
Airport 16 80.4% 80.1% 0.4% $135.95 $134.40 1.2% $109.32 $107.64 1.6% 7.4%
Interstate 8 66.8% 67.6% (1.2)% $109.36 $111.33 (1.8)% $73.01 $75.23 (3.0)% 2.2%
Resort 9 78.4% 77.1% 1.6% $145.84 $143.40 1.7% $114.28 $110.54 3.4% 5.3%
Small Metro/Town 19 72.2% 71.1% 1.4% $122.84 $119.99 2.4% $88.66 $85.37 3.8% 6.5%
Suburban 148 74.0% 73.0% 1.5% $129.42 $130.64 (0.9)% $95.81 $95.32 0.5% 59.2%
Urban 35 74.6% 74.6% 0.1% $148.04 $144.14 2.7% $110.50 $107.49 2.8% 19.4%
                                             
Total Portfolio   235   74.4%   73.6%   1.1%   $133.09   $132.66   0.3%   $99.02   $97.65   1.4%   100.0%
 

Note:  Location categorization is based on STR, Inc. designation.

 
 
Apple Hospitality REIT, Inc.
Comparable Hotels Operating Metrics by Chain Scale
Three Months ended March 31
(Unaudited)
         
Chain Scale/Brand       Occupancy   ADR   RevPAR  

% of Adjusted

Hotel EBITDA

# of Hotels Q1 2017   Q1 2016   % Change Q1 2017   Q1 2016   % Change Q1 2017   Q1 2016   % Change Q1 2017
Upscale            
Courtyard 40 70.6% 70.6% (0.0)% $135.73 $137.42 (1.2)% $95.80 $97.01 (1.3)% 18.9%
Hilton Garden Inn 41 72.2% 71.9% 0.4% $132.84 $131.60 0.9% $95.92 $94.62 1.4% 18.5%
Homewood Suites 34 79.3% 79.1% 0.2% $140.19 $140.22 (0.0)% $111.18 $110.98 0.2% 14.5%
Residence Inn 32 78.4% 77.0% 1.9% $142.53 $141.10 1.0% $111.78 $108.61 2.9% 15.7%
SpringHill Suites 17 74.2%   73.5%   0.9% $118.88   $117.99   0.7% $88.15   $86.74   1.6% 6.8%
Upscale Total 164 74.4%   73.9%   0.6% $135.29   $134.97   0.2% $100.65   $99.79   0.9% 74.4%
 
Upper Midscale
Fairfield Inn/Fairfield Inn & Suites 11 79.0% 77.9% 1.5% $121.45 $119.25 1.9% $96.01 $92.87 3.4% 4.2%
Hampton 36 73.2% 72.1% 1.6% $128.00 $128.68 (0.5)% $93.76 $92.75 1.1% 13.1%
Home2 Suites 6 80.8% 80.8% (0.0)% $122.37 $117.25 4.4% $98.87 $94.76 4.3% 2.4%
TownePlace Suites 12 74.5%   73.8%   0.9% $103.45   $99.32   4.2% $77.05   $73.30   5.1% 3.3%
Upper Midscale Total 65 75.1%   74.0%   1.5% $122.45   $121.35   0.9% $91.96   $89.79   2.4% 23.0%
 
Upper Upscale
Embassy Suites 2 83.8% 74.9% 11.9% $162.40 $160.13 1.4% $136.10 $119.90 13.5% 1.3%
Marriott 3 63.0% 61.5% 2.5% $149.22 $147.45 1.2% $94.07 $90.67 3.7% 2.9%
Renaissance 1 86.6%   79.6%   8.8% $184.12   $206.98   (11.0)% $159.45   $164.72   (3.2)% (1.6)%
Upper Upscale Total 6 70.9%   67.0%   5.9% $158.63   $160.51   (1.2)% $112.43   $107.48   4.6% 2.6%
                                             
Total Portfolio   235   74.4%   73.6%   1.1%   $133.09   $132.66   0.3%   $99.02   $97.65   1.4%   100.0%
 



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