Apple Hospitality REIT Reports Results of Operations for Third Quarter 2023

Apple Hospitality REIT, Inc. (NYSE: APLE) (the “Company” or “Apple Hospitality”) today announced results of operations for the third quarter ended September 30, 2023.

Apple Hospitality REIT, Inc.

Selected Statistical and Financial Data

As of and For the Three and Nine Months Ended September 30

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

 

 

Three Months Ended

 

Nine Months Ended

 

September 30,

 

September 30,

 

2023

 

2022

 

% Change

 

2023

 

2022

 

% Change

 

 

 

 

 

 

 

 

 

 

 

 

Net income

$58,512

 

$59,146

 

(1.1%)

 

$156,724

 

$142,493

 

10.0%

Net income per share

$0.26

 

$0.26

 

0.0%

 

$0.68

 

$0.62

 

9.7%

 

 

 

 

 

 

 

 

 

 

 

 

Operating income

$76,295

 

$75,410

 

1.2%

 

$208,571

 

$188,990

 

10.4%

Operating margin %

21.3%

 

22.1%

 

(80 bps)

 

20.2%

 

20.1%

 

10 bps

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDAre

$121,927

 

$118,895

 

2.6%

 

$346,359

 

$323,401

 

7.1%

Comparable Hotels Adjusted Hotel EBITDA

$132,161

 

$131,111

 

0.8%

 

$381,551

 

$359,649

 

6.1%

Comparable Hotels Adjusted Hotel EBITDA Margin %

37.1%

 

38.2%

 

(110 bps)

 

37.2%

 

38.1%

 

(90 bps)

Modified funds from operations (MFFO)

$104,139

 

$102,627

 

1.5%

 

$294,497

 

$276,890

 

6.4%

MFFO per share

$0.45

 

$0.45

 

0.0%

 

$1.29

 

$1.21

 

6.6%

 

 

 

 

 

 

 

 

 

 

 

 

Average Daily Rate (ADR) (Actual)

$159.36

 

$157.91

 

0.9%

 

$157.61

 

$150.02

 

5.1%

Occupancy (Actual)

77.1%

 

75.7%

 

1.8%

 

75.8%

 

73.6%

 

3.0%

Revenue Per Available Room (RevPAR) (Actual)

$122.91

 

$119.52

 

2.8%

 

$119.48

 

$110.40

 

8.2%

 

 

 

 

 

 

 

 

 

 

 

 

Comparable Hotels ADR

$159.36

 

$157.65

 

1.1%

 

$157.54

 

$149.98

 

5.0%

Comparable Hotels Occupancy

77.1%

 

75.7%

 

1.8%

 

75.8%

 

73.5%

 

3.1%

Comparable Hotels RevPAR

$122.91

 

$119.31

 

3.0%

 

$119.34

 

$110.23

 

8.3%

 

 

 

 

 

 

 

 

 

 

 

 

Distributions paid

$54,837

 

$38,830

 

41.2%

 

$183,119

 

$86,792

 

111.0%

Distributions paid per share

$0.24

 

$0.17

 

41.2%

 

$0.80

 

$0.38

 

110.5%

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

$35,366

 

 

 

 

 

 

 

 

 

 

Total debt outstanding

$1,380,247

 

 

 

 

 

 

 

 

 

 

Total debt outstanding, net of cash and cash equivalents

$1,344,881

 

 

 

 

 

 

 

 

 

 

Total debt outstanding, net of cash and cash equivalents, to total

capitalization (2)

27.7%

 

 

 

 

 

 

 

 

 

 

_______________________

(1)

 

Explanations of and reconciliations to net income determined in accordance with generally accepted accounting principles (“GAAP”) of non-GAAP financial measures, Adjusted EBITDAre, Comparable Hotels Adjusted Hotel EBITDA and MFFO, are included below.

(2)

 

Total debt outstanding, net of cash and cash equivalents ("net total debt outstanding"), divided by net total debt outstanding plus equity market capitalization based on the Company’s closing share price of $15.34 on September 30, 2023.

 

Comparable Hotels is defined as the 220 hotels owned by the Company as of September 30, 2023, and excludes one non-hotel property leased to third parties. 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, Chief Executive Officer of Apple Hospitality, commented, “Performance across our portfolio remained strong during the quarter, and we are pleased to report Comparable Hotels RevPAR growth of 3% as compared to the third quarter of 2022, driven by improvements in Comparable Hotels occupancy of 2% and ADR of 1%. Comparable Hotels RevPAR was up more than 7% relative to the third quarter of 2019, our highest quarterly Comparable Hotels RevPAR growth relative to 2019 since the onset of the pandemic, with Comparable Hotels occupancy still below pre-pandemic levels. Through strategic asset management, our efficient operating model and continued strength in ADR, we were able to achieve strong margins during the quarter, despite continued inflationary and wage pressures."

Mr. Knight continued, “Our strategy of investing in a broadly diversified portfolio of high-quality, rooms-focused hotels with low leverage has been tested across economic cycles and consistently yielded compelling results for our investors. Our outperformance since the onset of the pandemic has enabled us to maintain the strength and flexibility of our balance sheet, positioning us to be acquisitive within the current transaction environment. We are pleased to have acquired four hotels since the beginning of this year and have three additional hotels under contract for purchase. We continue to underwrite numerous potential opportunities and remain intently focused on maximizing total returns for our shareholders through strong operating fundamentals and strategic portfolio growth."

Hotel Portfolio Overview

As of September 30, 2023, Apple Hospitality owned 220 hotels with an aggregate of 28,929 guest rooms located in 87 markets throughout 37 states.

Third Quarter 2023 Highlights

  • Strong operating performance: For the third quarter 2023, Comparable Hotels RevPAR was $123, a 3% increase over third quarter 2022; Comparable Hotels ADR was $159, a 1% increase over third quarter 2022; and Comparable Hotels Occupancy was 77%, a 2% increase over third quarter 2022. Comparable Hotels Occupancy, ADR and RevPAR exceeded industry averages as reported by STR. Based on preliminary results for the Company's portfolio for the month of October 2023, Comparable Hotels Occupancy was approximately 78%, in line with October 2022, with growth in Comparable Hotels ADR as compared to October 2022.
  • Strong bottom-line performance: The Company achieved Comparable Hotels Adjusted Hotel EBITDA of approximately $132 million, a 1% improvement over third quarter 2022. The Company achieved Comparable Hotels Adjusted Hotel EBITDA Margin of approximately 37%, down 110 bps to third quarter 2022.
  • Acquisition activity: In October 2023, the Company acquired three hotels and a parking garage for a combined total purchase price of approximately $147 million. The Company currently has three additional hotels under contract for purchase for an anticipated combined gross purchase price of approximately $212 million.
  • Balance sheet: The Company has maintained the strength and flexibility of its balance sheet. At September 30, 2023, the Company’s total debt to total capitalization, net of cash and cash equivalents, was approximately 28%.
  • Monthly distributions: During the three months ended September 30, 2023, the Company paid distributions totaling $0.24 per common share. Based on the Company’s common stock closing price of $16.86 on November 3, 2023, the current annualized monthly cash distribution of $0.96 per common share represents an annual yield of approximately 5.7%.

The Company is providing monthly performance detail for its Comparable Hotels with comparisons to the respective periods of 2022. As a result of the industry's general recovery from the impact of COVID-19 on hotel operations, the Company, beginning with its second quarter 2023 earnings release, has generally transitioned away from comparisons to 2019. The following table highlights the Company’s Comparable Hotels monthly performance during the third quarter of 2023 as compared to the third quarter of 2022 (in thousands, except statistical data):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

% Change

 

July

 

August

 

September

 

 

 

July

 

August

 

September

 

 

 

July

 

August

 

September

 

 

 

2023

 

2023

 

2023

 

Q3 2023

 

2022

 

2022

 

2022

 

Q3 2022

 

2022

 

2022

 

2022

 

Q3 2022

ADR (Comparable Hotels)

$164.49

 

$156.38

 

$157.07

 

$159.36

 

$161.42

 

$154.96

 

$156.42

 

$157.65

 

1.9%

 

0.9%

 

0.4%

 

1.1%

Occupancy (Comparable Hotels)

77.6%

 

76.5%

 

77.3%

 

77.1%

 

77.0%

 

74.8%

 

75.3%

 

75.7%

 

0.8%

 

2.3%

 

2.7%

 

1.8%

RevPAR (Comparable Hotels)

$127.57

 

$119.66

 

$121.45

 

$122.91

 

$124.28

 

$115.83

 

$117.76

 

$119.31

 

2.6%

 

3.3%

 

3.1%

 

3.0%

Operating income (Actual)

$28,216

 

$23,361

 

$24,718

 

$76,295

 

$30,073

 

$21,623

 

$23,714

 

$75,410

 

(6.2%)

 

8.0%

 

4.2%

 

1.2%

Adjusted Hotel EBITDA (Actual) (1)

$47,653

 

$41,799

 

$42,709

 

$132,161

 

$48,444

 

$40,101

 

$40,621

 

$129,166

 

(1.6%)

 

4.2%

 

5.1%

 

2.3%

Comparable Hotels Adjusted Hotel

EBITDA (2)

$47,654

 

$41,799

 

$42,708

 

$132,161

 

$49,043

 

$41,101

 

$40,967

 

$131,111

 

(2.8%)

 

1.7%

 

4.2%

 

0.8%

_______________________

(1)

 

See explanation and reconciliation of Adjusted Hotel EBITDA to net income included below.

(2)

 

See explanation and reconciliation of Comparable Hotels Adjusted Hotel EBITDA to Adjusted Hotel EBITDA included below.

 

Comparable Hotels is defined as the 220 hotels owned by the Company as of September 30, 2023, and excludes one non-hotel property leased to third parties. 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.

Portfolio Activity

Acquisitions

As previously announced, since the beginning of 2023, the Company has acquired four hotels and a parking garage for a combined total purchase price of approximately $178 million. The acquisitions include the following:

  • In June 2023, the Company acquired the 154-room Courtyard by Marriott Cleveland University Circle for a total purchase price of approximately $31.0 million, or $201,000 per key.
  • In October 2023, the Company acquired the 175-room Courtyard by Marriott Salt Lake City Downtown for approximately $48.1 million, or $275,000 per key.
  • In October 2023, the Company acquired the 159-room Hyatt House Salt Lake City/Downtown for approximately $34.3 million, or $215,000 per key.
  • In October 2023, the Company acquired a 346-space parking garage for approximately $9.1 million, which serves the two Salt Lake City hotels as well as the surrounding area.
  • In October 2023, the Company acquired the 146-room Residence Inn by Marriott Seattle South/Renton for approximately $55.5 million, or $380,000 per key.

Contracts for Potential Acquisitions

As previously announced, the Company currently has three additional hotels under contract for purchase for a combined total anticipated gross purchase price of approximately $212 million. The hotels currently under contract for purchase include:

  • The 192-room Embassy Suites by Hilton South Jordan Salt Lake City for a total purchase price of approximately $36.8 million, or $191,000 per key, which the Company anticipates acquiring during the fourth quarter 2023.
  • An Embassy Suites by Hilton currently under development in downtown Madison, Wisconsin, for an anticipated total purchase price of approximately $78.6 million with an expected 260 rooms, which the Company anticipates acquiring in mid-2024 following completion of construction.
  • A Motto by Hilton to be developed in downtown Nashville, Tennessee, for an anticipated total purchase price of approximately $96.7 million with an expected 256 rooms, which the Company anticipates acquiring in 2025 following completion of construction.

There are many conditions to closing on each of these hotels that have not yet been satisfied, and there can be no assurance that closings on these hotels will occur under the outstanding purchase contracts.

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 nine months ended September 30, 2023, the Company invested approximately $42 million in capital expenditures. The Company anticipates investing approximately $70 million to $80 million in capital improvements during 2023, which includes comprehensive renovation projects for approximately 20 to 25 hotels.

Balance Sheet and Liquidity

Summary

As of September 30, 2023, the Company had approximately $1.4 billion of total outstanding debt with a current combined weighted-average interest rate of approximately 4.3%, cash on hand of approximately $35 million and availability under its revolving credit facility of approximately $650 million. Excluding unamortized debt issuance costs and fair value adjustments, the Company’s total outstanding debt as of September 30, 2023, was comprised of approximately $285 million in property-level debt secured by 15 hotels and approximately $1.1 billion outstanding under its unsecured credit facilities. The number of unencumbered hotels in the Company’s portfolio as of September 30, 2023, was 205. The Company’s total debt to total capitalization, net of cash and cash equivalents at September 30, 2023, was approximately 28%, which provides Apple Hospitality with financial flexibility to fund capital requirements and pursue opportunities in the marketplace. On July 19, 2023, the Company entered into an amendment of its $225 million term loan facility, which extended the maturity date of the existing $50 million term loan by two years to August 2, 2025. As of September 30, 2023, the Company’s weighted-average debt maturities were 4.0 years.

Capital Markets

Share Repurchase Program

The Company has in place a Share Repurchase Program that provides for share repurchases in open market transactions. During the nine months ended September 30, 2023, the Company purchased, under its Share Repurchase Program, approximately 0.5 million of its common shares at a weighted-average market purchase price of approximately $14.34 per common share, for an aggregate purchase price of approximately $7 million. Shares were repurchased in open market transactions under the Share Repurchase Program, including pursuant to written trading plans intended to comply with Rule 10b5-1 under the Securities Exchange Act of 1934, as amended. As of September 30, 2023, the Company had approximately $335 million remaining under its Share Repurchase Program for the repurchase of shares.

ATM Program

The Company also has in place an at-the-market offering program (the “ATM Program”). As of September 30, 2023, the Company had approximately $224 million remaining under its ATM Program for the issuance of shares. No shares were sold under the ATM program during the nine months ended September 30, 2023.

Shareholder Distributions

During the three months ended September 30, 2023, the Company paid distributions totaling $0.24 per common share. Based on the Company’s common stock closing price of $16.86 on November 3, 2023, the current annualized monthly cash distribution of $0.96 per common share represents an annual yield of approximately 5.7%. While the Company currently expects monthly distributions to continue, each distribution is subject to approval by the Company’s Board of Directors. The Company’s Board of Directors, in consultation with management, will continue to monitor the Company’s distribution rate and timing relative to the performance of its hotels, capital improvement needs, varying economic cycles, acquisitions, dispositions, other cash requirements and the Company’s REIT status for federal income tax purposes, and may make adjustments as it deems appropriate.

Updated 2023 Outlook

The Company is updating its operational and financial outlook for 2023. 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. As compared to previously provided 2023 guidance, the Company is adjusting: Net income by increasing the low end of the range by $4 million and decreasing the high end of the range by $13 million; Comparable Hotels RevPAR Change, which is the change in Comparable Hotels RevPAR in 2023 compared to 2022, by narrowing the range and increasing the midpoint of the range by 50 bps; Comparable Hotels Adjusted Hotel EBITDA Margin % by maintaining the low end and decreasing the high end of the range by 70 bps; and Adjusted EBITDAre by decreasing the high end of the range by $12 million while increasing the low end of the range by $5 million. The reduction in the midpoint of the Company's guidance for Net Income and Adjusted EBITDAre is primarily a result of slightly higher than anticipated operating costs. Comparable Hotels RevPAR Change guidance and Comparable Hotels Adjusted Hotel EBITDA Margin % guidance include properties acquired and announced for acquisition by year-end 2023 as if the hotels were owned as of January 1, 2022, exclude dispositions and assets held for sale since January 1, 2022, and exclude one non-hotel property leased to third parties. For the full year 2023, the Company anticipates its 2023 results will be in the following range:

 

 

Updated 2023 Guidance(1)

 

 

Low-End

 

High-End

Net income

 

$167 Million

 

$189 Million

Comparable Hotels RevPAR Change

 

5.5%

 

7.5%

Comparable Hotels Adjusted Hotel EBITDA Margin %

 

35.4%

 

36.3%

Adjusted EBITDAre

 

$423 Million

 

$440 Million

Capital expenditures

 

$70 Million

 

$80 Million

_______________________
(1)  

Explanations of and reconciliations to net income guidance of Adjusted EBITDAre and Comparable Hotels Adjusted Hotel EBITDA guidance are included below.

Third Quarter 2023 Earnings Conference Call

The Company will host a quarterly conference call for investors and interested parties at 10 a.m. Eastern Time on Wednesday, November 8, 2023. The conference call will be accessible by telephone and the internet. To access the call, participants from within the U.S. should dial 877-407-9039, and participants from outside the U.S. should dial 201-689-8470. Participants may also access the call via live webcast by visiting the Investor Information section of the Company's website at ir.applehospitalityreit.com. A replay of the call will be available from approximately 2 p.m. Eastern Time on November 8, 2023, through 11:59 p.m. Eastern Time on November 22, 2023. To access the replay, the domestic dial-in number is 844-512-2921, the international dial-in number is 412-317-6671, and the passcode is 13740906. The archive of the webcast will be available on the Company's website for a limited time.

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 and most diverse portfolios of upscale, rooms-focused hotels in the United States. Apple Hospitality’s portfolio consists of 223 hotels with more than 29,400 guest rooms located in 87 markets throughout 37 states as well as one property leased to third parties. Concentrated with industry-leading brands, the Company’s hotel portfolio consists of 99 Marriott-branded hotels, 119 Hilton-branded hotels and five Hyatt-branded hotels. For more information, please visit www.applehospitalityreit.com.

Apple Hospitality REIT Non-GAAP Financial Measures

The Company considers the following non-GAAP financial measures useful to investors as key supplemental measures of its operating performance: Funds from Operations (“FFO”); Modified FFO (“MFFO”); Earnings Before Interest, Income Taxes, Depreciation and Amortization (“EBITDA”); Earnings Before Interest, Income Taxes, Depreciation and Amortization for Real Estate (“EBITDAre”); Adjusted EBITDAre; Adjusted Hotel EBITDA; Comparable Hotels Adjusted Hotel EBITDA; and Same Store Hotels Adjusted Hotel EBITDA. These non-GAAP financial measures should be considered along with, but not as alternatives to, net income (loss), cash flow from operations or any other operating GAAP measure. FFO, MFFO, EBITDA, EBITDAre, Adjusted EBITDAre, Adjusted Hotel EBITDA, Comparable Hotels Adjusted Hotel EBITDA and Same Store Hotels Adjusted Hotel EBITDA are not necessarily indicative of funds available to fund the Company’s cash needs, including its ability to make cash distributions. Although FFO, MFFO, EBITDA, EBITDAre, Adjusted EBITDAre, Adjusted Hotel EBITDA, Comparable Hotels Adjusted Hotel EBITDA and Same Store Hotels Adjusted Hotel EBITDA, as calculated by the Company, may not be comparable to FFO, MFFO, EBITDA, EBITDAre, Adjusted EBITDAre, Adjusted Hotel EBITDA, Comparable Hotels Adjusted Hotel EBITDA and Same Store Hotels Adjusted Hotel EBITDA, as reported by other companies that do not define such terms exactly as the Company defines such terms, the Company believes these supplemental measures are useful to investors when comparing the Company’s results between periods and with other REITs. Reconciliations of these non-GAAP financial measures to net income (loss) are provided in the following pages.

Forward-Looking Statements Disclaimer

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are typically identified by use of statements that include phrases such as “may,” “believe,” “expect,” “anticipate,” “intend,” “estimate,” “project,” “target,” “goal,” “plan,” “should,” “will,” “predict,” “potential,” “outlook,” “strategy,” and similar expressions that convey the uncertainty of future events or outcomes. Such statements involve known and unknown risks, uncertainties, and other factors which may cause the actual results, performance, or achievements of the Company to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements.

Such factors include, but are not limited to, the ability of the Company to effectively acquire and dispose of properties and redeploy proceeds; the anticipated timing and frequency of shareholder distributions; the ability of the Company to fund capital obligations; the ability of the Company to successfully integrate pending transactions and implement its operating strategy; changes in general political, economic and competitive conditions and specific market conditions (including the potential effects of inflation or a recessionary environment); reduced business and leisure travel due to geopolitical uncertainty, including terrorism, travel-related health concerns, including COVID-19 or other widespread outbreaks of infectious or contagious diseases in the U.S.; inclement weather conditions, including natural disasters such as hurricanes, earthquakes and wildfires; government shutdowns, airline strikes or other disruptions; adverse changes in the real estate and real estate capital markets; financing risks; changes in interest rates; litigation risks; regulatory proceedings or inquiries; and changes in laws or regulations or interpretations of current laws and regulations that impact the Company’s business, assets or classification as a REIT. Although the Company believes that the assumptions underlying the forward-looking statements contained herein are reasonable, any of the assumptions could be inaccurate, and therefore there can be no assurance that such statements included in this press release will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by the Company or any other person that the results or conditions described in such statements or the objectives and plans of the Company will be achieved. In addition, the Company’s qualification as a REIT involves the application of highly technical and complex provisions of the Internal Revenue Code of 1986, as amended. Readers should carefully review the risk factors described in the Company’s filings with the Securities and Exchange Commission, including but not limited to those discussed in the section titled “Risk Factors” in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022. Any forward-looking statement that the Company makes speaks only as of the date of this press release. The Company undertakes no obligation to publicly update or revise any forward-looking statements or cautionary factors, as a result of new information, future events, or otherwise, except as required by law.

For additional information or to receive press releases by email, visit www.applehospitalityreit.com.

 

Apple Hospitality REIT, Inc.

Consolidated Balance Sheets

(in thousands, except share data)

 

 

 

September 30,

 

December 31,

 

 

2023

 

2022

 

 

(unaudited)

 

 

Assets

 

 

 

 

Investment in real estate, net of accumulated depreciation and amortization

of $1,629,340 and $1,492,097, respectively

 

$4,548,787

 

$4,610,962

Cash and cash equivalents

 

35,366

 

4,077

Restricted cash-furniture, fixtures and other escrows

 

33,697

 

39,435

Due from third-party managers, net

 

60,801

 

43,331

Other assets, net

 

85,391

 

74,909

Total Assets

 

$4,764,042

 

$4,772,714

 

 

Liabilities

 

 

 

 

Debt, net

 

$1,373,268

 

$1,366,249

Finance lease liabilities

 

111,943

 

112,006

Accounts payable and other liabilities

 

104,920

 

116,064

Total Liabilities

 

1,590,131

 

1,594,319

 

 

 

 

 

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 228,807,202 and 228,644,861 shares, respectively

 

4,580,193

 

4,577,022

Accumulated other comprehensive income

 

37,411

 

36,881

Distributions greater than net income

 

(1,443,693)

 

(1,435,508)

Total Shareholders' Equity

 

3,173,911

 

3,178,395

 

 

 

 

 

Total Liabilities and Shareholders' Equity

 

$4,764,042

 

$4,772,714

 _______________________  

Note: The Consolidated Balance Sheets and corresponding footnotes can be found in the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2023.

 

 

Apple Hospitality REIT, Inc.

Consolidated Statements of Operations and Comprehensive Income

(Unaudited)

(in thousands, except per share data)

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

Room

 

$

327,121

 

 

$

315,940

 

 

$

943,684

 

 

$

866,286

 

Food and beverage

 

 

13,576

 

 

 

11,870

 

 

 

42,032

 

 

 

32,353

 

Other

 

 

17,563

 

 

 

13,340

 

 

 

45,628

 

 

 

40,657

 

Total revenue

 

 

358,260

 

 

 

341,150

 

 

 

1,031,344

 

 

 

939,296

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Hotel operating expense:

 

 

 

 

 

 

 

 

 

 

 

 

Operating

 

 

85,829

 

 

 

81,320

 

 

 

249,403

 

 

 

221,715

 

Hotel administrative

 

 

29,172

 

 

 

27,516

 

 

 

85,933

 

 

 

78,711

 

Sales and marketing

 

 

30,770

 

 

 

28,533

 

 

 

89,406

 

 

 

78,494

 

Utilities

 

 

13,797

 

 

 

13,383

 

 

 

36,271

 

 

 

34,226

 

Repair and maintenance

 

 

16,336

 

 

 

15,632

 

 

 

48,452

 

 

 

43,468

 

Franchise fees

 

 

15,895

 

 

 

14,949

 

 

 

45,407

 

 

 

41,015

 

Management fees

 

 

11,911

 

 

 

11,734

 

 

 

34,516

 

 

 

31,955

 

Total hotel operating expense

 

 

203,710

 

 

 

193,067

 

 

 

589,388

 

 

 

529,584

 

Property taxes, insurance and other

 

 

21,678

 

 

 

19,052

 

 

 

61,347

 

 

 

56,510

 

General and administrative

 

 

11,079

 

 

 

10,271

 

 

 

34,640

 

 

 

30,216

 

Depreciation and amortization

 

 

45,498

 

 

 

45,135

 

 

 

137,398

 

 

 

135,781

 

Total expense

 

 

281,965

 

 

 

267,525

 

 

 

822,773

 

 

 

752,091

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gain on sale of real estate

 

 

-

 

 

 

1,785

 

 

 

-

 

 

 

1,785

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income

 

 

76,295

 

 

 

75,410

 

 

 

208,571

 

 

 

188,990

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest and other expense, net

 

 

(17,470

)

 

 

(14,933

)

 

 

(50,973

)

 

 

(44,785

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

 

58,825

 

 

 

60,477

 

 

 

157,598

 

 

 

144,205

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income tax expense

 

 

(313

)

 

 

(1,331

)

 

 

(874

)

 

 

(1,712

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

58,512

 

 

$

59,146

 

 

$

156,724

 

 

$

142,493

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other comprehensive income:

 

 

 

 

 

 

 

 

 

 

 

 

Interest rate derivatives

 

 

1,412

 

 

 

16,024

 

 

 

530

 

 

 

53,862

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Comprehensive income

 

$

59,924

 

 

$

75,170

 

 

$

157,254

 

 

$

196,355

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted net income per common share

 

$

0.26

 

 

$

0.26

 

 

$

0.68

 

 

$

0.62

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding - basic and diluted

 

 

228,877

 

 

 

228,991

 

 

 

229,103

 

 

 

228,992

 

_______________________

 

Note: The Consolidated Statements of Operations and Comprehensive Income and corresponding footnotes can be found in the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2023.

Apple Hospitality REIT, Inc.

Comparable Hotels Operating Metrics and Statistical Data

(Unaudited)

(in thousands, except statistical data)

 

 

 

Three Months Ended

Nine Months Ended

 

 

September 30,

September 30,

 

 

 

 

 

 

% Change

 

 

 

 

 

% Change

 

 

2023

 

2022

 

2022

 

2023

 

2022

 

2022

Operating income (Actual)

 

$76,295

 

$75,410

 

1.2%

 

$208,571

 

$188,990

 

10.4%

Operating margin % (Actual)

 

21.3%

 

22.1%

 

(80 bps)

 

20.2%

 

20.1%

 

10 bps

 

 

 

 

 

 

 

 

 

 

 

 

 

Comparable Hotels Total Revenue

 

$356,248

 

$342,913

 

3.9%

 

$1,026,907

 

$944,641

 

8.7%

Comparable Hotels Total Operating Expenses

 

224,087

 

211,802

 

5.8%

 

645,356

 

584,992

 

10.3%

Comparable Hotels Adjusted Hotel EBITDA

 

$132,161

 

$131,111

 

0.8%

 

$381,551

 

$359,649

 

6.1%

Comparable Hotels Adjusted Hotel EBITDA Margin %

 

37.1%

 

38.2%

 

(110 bps)

 

37.2%

 

38.1%

 

(90 bps)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ADR (Comparable Hotels)

 

$159.36

 

$157.65

 

1.1%

 

$157.54

 

$149.98

 

5.0%

Occupancy (Comparable Hotels)

 

77.1%

 

75.7%

 

1.8%

 

75.8%

 

73.5%

 

3.1%

RevPAR (Comparable Hotels)

 

$122.91

 

$119.31

 

3.0%

 

$119.34

 

$110.23

 

8.3%

 

 

 

 

 

 

 

 

 

 

 

 

 

ADR (Actual)

 

$159.36

 

$157.91

 

0.9%

 

$157.61

 

$150.02

 

5.1%

Occupancy (Actual)

 

77.1%

 

75.7%

 

1.8%

 

75.8%

 

73.6%

 

3.0%

RevPAR (Actual)

 

$122.91

 

$119.52

 

2.8%

 

$119.48

 

$110.40

 

8.2%

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation to Actual Results

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Revenue (Actual)

 

$358,260

 

$341,150

 

 

 

$1,031,344

 

$939,296

 

 

Revenue from acquisitions prior to ownership

 

-

 

6,426

 

 

 

3,298

 

16,910

 

 

Revenue from dispositions

 

-

 

(454)

 

 

 

-

 

(1,617)

 

 

Revenue from non-hotel property

 

(2,012)

 

(4,209)

 

 

 

(7,735)

 

(9,948)

 

 

Comparable Hotels Total Revenue

 

$356,248

 

$342,913

 

 

 

$1,026,907

 

$944,641

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted Hotel EBITDA (AHEBITDA) (Actual) (1)

 

$132,161

 

$129,166

 

 

 

$380,154

 

$353,617

 

 

AHEBITDA from acquisitions prior to ownership

 

-

 

2,639

 

 

 

823

 

6,509

 

 

AHEBITDA from dispositions

 

-

 

(77)

 

 

 

-

 

(459)

 

 

AHEBITDA from non-hotel property (2)

 

-

 

(617)

 

 

 

574

 

(18)

 

 

Comparable Hotels AHEBITDA

 

$132,161

 

$131,111

 

 

 

$381,551

 

$359,649

 

 

_______________________

(1)

 

Represents the Company's actual Adjusted Hotel EBITDA which excludes Adjusted EBITDAre from its non-hotel property, the Company's independent boutique hotel in New York, New York, for the second half of 2023, subsequent to its lease to a third-party hotel operator for all hotel operations.

(2) 

 

Represents Adjusted Hotel EBITDA from the Company's independent boutique hotel in New York, New York prior to its lease to a third-party hotel operator for all hotel operations in the first half of 2023.

 

Note: Comparable Hotels is defined as the 220 hotels owned by the Company as of September 30, 2023, and excludes one non-hotel property leased to third parties. 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)

 

 

 

2022

 

2023

 

 

Q1

 

Q2

 

Q3

 

Q4

 

Q1

 

Q2

 

Q3

Operating income (Actual)

 

$32,835

 

$80,745

 

$75,410

 

$17,488

 

$49,247

 

$83,029

 

$76,295

Operating margin % (Actual)

 

12.6%

 

23.9%

 

22.1%

 

5.8%

 

15.8%

 

23.0%

 

21.3%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Comparable Hotels Total Revenue

 

$261,854

 

$339,874

 

$342,913

 

$296,628

 

$310,009

 

$360,650

 

$356,248

Comparable Hotels Total Operating

Expenses

 

172,230

 

200,960

 

211,802

 

195,379

 

202,277

 

218,992

 

224,087

Comparable Hotels Adjusted Hotel EBITDA

 

$89,624

 

$138,914

 

$131,111

 

$101,249

 

$107,732

 

$141,658

 

$132,161

Comparable Hotels Adjusted Hotel EBITDA

Margin %

 

34.2%

 

40.9%

 

38.2%

 

34.1%

 

34.8%

 

39.3%

 

37.1%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ADR (Comparable Hotels)

 

$137.12

 

$153.39

 

$157.65

 

$146.34

 

$152.02

 

$160.75

 

$159.36

Occupancy (Comparable Hotels)

 

66.9%

 

77.8%

 

75.7%

 

69.6%

 

71.9%

 

78.2%

 

77.1%

RevPAR (Comparable Hotels)

 

$91.79

 

$119.28

 

$119.31

 

$101.84

 

$109.31

 

$125.64

 

$122.91

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ADR (Actual)

 

$137.03

 

$153.35

 

$157.91

 

$147.30

 

$152.01

 

$160.98

 

$159.36

Occupancy (Actual)

 

67.1%

 

77.9%

 

75.7%

 

69.7%

 

72.0%

 

78.2%

 

77.1%

RevPAR (Actual)

 

$91.98

 

$119.41

 

$119.52

 

$102.71

 

$109.46

 

$125.96

 

$122.91

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation to Actual Results

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Revenue (Actual)

 

$260,478

 

$337,668

 

$341,150

 

$299,121

 

$311,454

 

$361,630

 

$358,260

Revenue from acquisitions prior to

ownership

 

3,821

 

6,663

 

6,426

 

2,893

 

1,398

 

1,900

 

-

Revenue from dispositions

 

(500)

 

(663)

 

(454)

 

-

 

-

 

-

 

-

Revenue from non-hotel property

 

(1,945)

 

(3,794)

 

(4,209)

 

(5,386)

 

(2,843)

 

(2,880)

 

(2,012)

Comparable Hotels Total Revenue

 

$261,854

 

$339,874

 

$342,913

 

$296,628

 

$310,009

 

$360,650

 

$356,248

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted Hotel EBITDA (AHEBITDA) (Actual) (1)

 

$87,936

 

$136,515

 

$129,166

 

$101,962

 

$106,749

 

$141,244

 

$132,161

AHEBITDA from acquisitions prior to

ownership

 

910

 

2,960

 

2,639

 

1,007

 

187

 

636

 

-

AHEBITDA from dispositions

 

(143)

 

(239)

 

(77)

 

(169)

 

-

 

-

 

-

AHEBITDA from non-hotel property (2)

 

921

 

(322)

 

(617)

 

(1,551)

 

796

 

(222)

 

-

Comparable Hotels AHEBITDA

 

$89,624

 

$138,914

 

$131,111

 

$101,249

 

$107,732

 

$141,658

 

$132,161

_______________________

(1)  

Represents the Company's actual Adjusted Hotel EBITDA which excludes Adjusted EBITDAre from its non-hotel property, the Company's independent boutique hotel in New York, New York, for the second half of 2023, subsequent to its lease to a third-party hotel operator for all hotel operations.

(2)  

Represents Adjusted Hotel EBITDA from the Company's independent boutique hotel in New York, New York prior to its lease to a third-party hotel operator for all hotel operations in the first half of 2023.

   

 

Note: Comparable Hotels is defined as the 220 hotels owned by the Company as of September 30, 2023, and excludes one non-hotel property leased to third parties. 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.

Same Store Hotels Operating Metrics and Statistical Data

(Unaudited)

(in thousands, except statistical data)

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

September 30,

 

September 30,

 

 

 

 

 

 

% Change

 

 

 

 

 

% Change

 

 

2023

 

2022

 

2022

 

2023

 

2022

 

2022

Operating income (Actual)

 

$76,295

 

$75,410

 

1.2%

 

$208,571

 

$188,990

 

10.4%

Operating margin % (Actual)

 

21.3%

 

22.1%

 

(80 bps)

 

20.2%

 

20.1%

 

10 bps

 

 

 

 

 

 

 

 

 

 

 

 

 

Same Store Hotels Total Revenue

 

$349,519

 

$336,487

 

3.9%

 

$1,008,320

 

$927,731

 

8.7%

Same Store Hotels Total Operating Expenses

 

220,367

 

208,015

 

5.9%

 

634,352

 

574,591

 

10.4%

Same Store Hotels Adjusted Hotel EBITDA

 

$129,152

 

$128,472

 

0.5%

 

$373,968

 

$353,140

 

5.9%

Same Store Hotels Adjusted Hotel EBITDA Margin %

 

37.0%

 

38.2%

 

(120 bps)

 

37.1%

 

38.1%

 

(100 bps)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ADR (Same Store Hotels)

 

$158.92

 

$157.34

 

1.0%

 

$157.16

 

$149.67

 

5.0%

Occupancy (Same Store Hotels)

 

77.2%

 

75.7%

 

2.0%

 

75.8%

 

73.6%

 

3.0%

RevPAR (Same Store Hotels)

 

$122.64

 

$119.08

 

3.0%

 

$119.18

 

$110.15

 

8.2%

 

 

 

 

 

 

 

 

 

 

 

 

 

ADR (Actual)

 

$159.36

 

$157.91

 

0.9%

 

$157.61

 

$150.02

 

5.1%

Occupancy (Actual)

 

77.1%

 

75.7%

 

1.8%

 

75.8%

 

73.6%

 

3.0%

RevPAR (Actual)

 

$122.91

 

$119.52

 

2.8%

 

$119.48

 

$110.40

 

8.2%

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation to Actual Results

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Revenue (Actual)

 

$358,260

 

$341,150

 

 

 

$1,031,344

 

$939,296

 

 

Revenue from acquisitions

 

(6,729)

 

-

 

 

 

(15,289)

 

-

 

 

Revenue from dispositions

 

-

 

(454)

 

 

 

-

 

(1,617)

 

 

Revenue from non-hotel property

 

(2,012)

 

(4,209)

 

 

 

(7,735)

 

(9,948)

 

 

Same Store Hotels Total Revenue

 

$349,519

 

$336,487

 

 

 

$1,008,320

 

$927,731

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted Hotel EBITDA (AHEBITDA) (Actual) (1)

 

$132,161

 

$129,166

 

 

 

$380,154

 

$353,617

 

 

AHEBITDA from acquisitions

 

(3,009)

 

-

 

 

 

(6,760)

 

-

 

 

AHEBITDA from dispositions

 

-

 

(77)

 

 

 

-

 

(459)

 

 

AHEBITDA from non-hotel property (2)

 

-

 

(617)

 

 

 

574

 

(18)

 

 

Same Store Hotels AHEBITDA

 

$129,152

 

$128,472

 

 

 

$373,968

 

$353,140

 

 

_______________________

(1)  

Represents the Company's actual Adjusted Hotel EBITDA which excludes Adjusted EBITDAre from its non-hotel property, the Company's independent boutique hotel in New York, New York, for the second half of 2023, subsequent to its lease to a third-party hotel operator for all hotel operations.

(2)  

Represents Adjusted Hotel EBITDA from the Company's independent boutique hotel in New York, New York prior to its lease to a third-party hotel operator for all hotel operations in the first half of 2023.

   

 

Note: Same Store Hotels is defined as the 217 hotels owned by the Company as of January 1, 2022, and during the entirety of the periods being compared, and excludes one non-hotel property leased to third parties. This information has not been audited.
   

 

Reconciliation of net income to non-GAAP financial measures is included in the following pages.

Apple Hospitality REIT, Inc.

Same Store Hotels Quarterly Operating Metrics and Statistical Data

(Unaudited)

(in thousands, except statistical data)

 

 

 

2022

 

2023

 

 

Q1

 

Q2

 

Q3

 

Q4

 

Q1

 

Q2

 

Q3

Operating income (Actual)

 

$32,835

 

$80,745

 

$75,410

 

$17,488

 

$49,247

 

$83,029

 

$76,295

Operating margin % (Actual)

 

12.6%

 

23.9%

 

22.1%

 

5.8%

 

15.8%

 

23.0%

 

21.3%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Same Store Hotels Total Revenue

 

$258,033

 

$333,211

 

$336,487

 

$291,368

 

$305,320

 

$353,481

 

$349,519

Same Store Hotels Total Operating

Expenses

 

169,319

 

197,257

 

208,015

 

192,312

 

198,834

 

215,151

 

220,367

Same Store Hotels Adjusted Hotel

EBITDA

 

$88,714

 

$135,954

 

$128,472

 

$99,056

 

$106,486

 

$138,330

 

$129,152

Same Store Hotels Adjusted Hotel

EBITDA Margin %

 

34.4%

 

40.8%

 

38.2%

 

34.0%

 

34.9%

 

39.1%

 

37.0%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ADR (Same Store Hotels)

 

$137.01

 

$152.92

 

$157.34

 

$146.02

 

$151.99

 

$160.11

 

$158.92

Occupancy (Same Store Hotels)

 

67.2%

 

77.8%

 

75.7%

 

69.7%

 

72.0%

 

78.2%

 

77.2%

RevPAR (Same Store Hotels)

 

$92.03

 

$119.04

 

$119.08

 

$101.76

 

$109.51

 

$125.24

 

$122.64

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ADR (Actual)

 

$137.03

 

$153.35

 

$157.91

 

$147.30

 

$152.01

 

$160.98

 

$159.36

Occupancy (Actual)

 

67.1%

 

77.9%

 

75.7%

 

69.7%

 

72.0%

 

78.2%

 

77.1%

RevPAR (Actual)

 

$91.98

 

$119.41

 

$119.52

 

$102.71

 

$109.46

 

$125.96

 

$122.91

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation to Actual Results

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Revenue (Actual)

 

$260,478

 

$337,668

 

$341,150

 

$299,121

 

$311,454

 

$361,630

 

$358,260

Revenue from acquisitions

 

-

 

-

 

-

 

(2,367)

 

(3,291)

 

(5,269)

 

(6,729)

Revenue from dispositions

 

(500)

 

(663)

 

(454)

 

-

 

-

 

-

 

-

Revenue from non-hotel property

 

(1,945)

 

(3,794)

 

(4,209)

 

(5,386)

 

(2,843)

 

(2,880)

 

(2,012)

Same Store Hotels Total Revenue

 

$258,033

 

$333,211

 

$336,487

 

$291,368

 

$305,320

 

$353,481

 

$349,519

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted Hotel EBITDA (AHEBITDA)

(Actual) (1)

 

$87,936

 

$136,515

 

$129,166

 

$101,962

 

$106,749

 

$141,244

 

$132,161

AHEBITDA from acquisitions

 

-

 

-

 

-

 

(1,186)

 

(1,059)

 

(2,692)

 

(3,009)

AHEBITDA from dispositions

 

(143)

 

(239)

 

(77)

 

(169)

 

-

 

-

 

-

AHEBITDA from non-hotel property (2)

 

921

 

(322)

 

(617)

 

(1,551)

 

796

 

(222)

 

-

Same Store Hotels AHEBITDA

 

$88,714

 

$135,954

 

$128,472

 

$99,056

 

$106,486

 

$138,330

 

$129,152

_______________________

(1)  

Represents the Company's actual Adjusted Hotel EBITDA which excludes Adjusted EBITDAre from its non-hotel property, the Company's independent boutique hotel in New York, New York, for the second half of 2023, subsequent to its lease to a third-party hotel operator for all hotel operations.

(2)  

Represents Adjusted Hotel EBITDA from the Company's independent boutique hotel in New York, New York prior to its lease to a third-party hotel operator for all hotel operations in the first half of 2023.

   

 

Note: Same Store Hotels is defined as the 217 hotels owned by the Company as of January 1, 2022, and during the entirety of the periods being compared, and excludes one non-hotel property leased to third parties. This information has not been audited.
   

 

Reconciliation of net income to non-GAAP financial measures is included in the following pages.

Apple Hospitality REIT, Inc.

Reconciliation of Net Income to EBITDA, EBITDAre, Adjusted EBITDAre 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.

In addition to EBITDA, the Company also calculates and presents EBITDAre in accordance with standards established by the National Association of Real Estate Investment Trusts (“Nareit”), which defines EBITDAre as EBITDA, excluding gains and losses from the sale of certain real estate assets (including gains and losses from change in control), plus real estate related impairments, and adjustments to reflect the entity’s share of EBITDAre of unconsolidated affiliates. The Company presents EBITDAre because it believes that it provides further useful information to investors in comparing its operating performance between periods and between REITs that report EBITDAre using the Nareit definition.

The Company also considers the exclusion of non-cash straight-line operating ground lease expense from EBITDAre useful, as this expense does not reflect the underlying performance of the related hotels (Adjusted EBITDAre).

The Company further excludes actual corporate-level general and administrative expense for the Company as well as Adjusted EBITDAre from its non-hotel property from Adjusted EBITDAre (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 it 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 to EBITDA, EBITDAre, Adjusted EBITDAre and Adjusted Hotel EBITDA on a quarterly basis for 2022 and 2023:

 

 

2022

 

2023

 

 

Q1

 

Q2

 

Q3

 

Q4

 

Q1

 

Q2

 

Q3

Net income

 

$18,002

 

$65,345

 

$59,146

 

$2,312

 

$32,923

 

$65,289

 

$58,512

Depreciation and amortization

 

45,324

 

45,322

 

45,135

 

45,916

 

45,906

 

45,994

 

45,498

Amortization of favorable and unfavorable operating

leases, net

 

99

 

103

 

97

 

97

 

97

 

85

 

99

Interest and other expense, net

 

14,654

 

15,198

 

14,933

 

14,948

 

16,004

 

17,499

 

17,470

Income tax expense

 

179

 

202

 

1,331

 

228

 

320

 

241

 

313

EBITDA

 

78,258

 

126,170

 

120,642

 

63,501

 

95,250

 

129,108

 

121,892

Gain on sale of real estate

 

-

 

-

 

(1,785)

 

-

 

-

 

-

 

-

Loss on impairment of depreciable real estate assets

 

-

 

-

 

-

 

26,175

 

-

 

-

 

-

EBITDAre

 

78,258

 

126,170

 

118,857

 

89,676

 

95,250

 

129,108

 

121,892

Non-cash straight-line operating ground lease expense

 

40

 

38

 

38

 

38

 

38

 

36

 

35

Adjusted EBITDAre

 

78,298

 

126,208

 

118,895

 

89,714

 

95,288

 

129,144

 

121,927

General and administrative expense

 

9,638

 

10,307

 

10,271

 

12,248

 

11,461

 

12,100

 

11,079

Adjusted EBITDAre from non-hotel property (1)

 

-

 

-

 

-

 

-

 

-

 

-

 

(845)

Adjusted Hotel EBITDA

 

$87,936

 

$136,515

 

$129,166

 

$101,962

 

$106,749

 

$141,244

 

$132,161

(1)  

Non-hotel property only includes the results of one hotel in New York, New York that is leased to a third-party hotel operator. This property's Adjusted EBITDAre results are not included in Adjusted Hotel EBITDA starting in the second half of 2023.

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 Nareit, which defines FFO as net income (loss) (computed in accordance with GAAP), excluding gains and losses from the sale of certain real estate assets (including gains and losses from change in control), extraordinary items as defined by GAAP, and the cumulative effect of changes in accounting principles, plus real estate related depreciation, amortization and impairments, and adjustments for unconsolidated affiliates. 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 calculates MFFO by further adjusting FFO for the exclusion of amortization of finance ground lease assets, amortization of favorable and unfavorable operating leases, net and non-cash straight-line operating ground lease expense, as these expenses do 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 and nine months ended September 30, 2023 and 2022:

 

 

Three Months Ended

September 30,

 

Nine Months Ended

September 30,

 

 

2023

 

2022

 

2023

 

2022

Net income

 

$58,512

 

$59,146

 

$156,724

 

$142,493

Depreciation of real estate owned

 

44,734

 

44,372

 

135,105

 

133,489

Gain on sale of real estate

 

-

 

(1,785)

 

-

 

(1,785)

Funds from operations

 

103,246

 

101,733

 

291,829

 

274,197

Amortization of finance ground lease assets

 

759

 

759

 

2,278

 

2,278

Amortization of favorable and unfavorable operating leases, net

 

99

 

97

 

281

 

299

Non-cash straight-line operating ground lease expense

 

35

 

38

 

109

 

116

Modified funds from operations

 

$104,139

 

$102,627

 

$294,497

 

$276,890

Apple Hospitality REIT, Inc.

2023 Guidance Reconciliation of Net Income to EBITDA, EBITDAre, Adjusted EBITDAre, Adjusted Hotel EBITDA and

Comparable Hotels Adjusted Hotel EBITDA

(Unaudited)

(in thousands)

The guidance of net income, EBITDA, EBITDAre, Adjusted EBITDAre, Adjusted Hotel EBITDA and Comparable Hotels Adjusted Hotel EBITDA (and all other guidance given) 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 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, 2022.

The following table reconciles the Company’s GAAP net income guidance to EBITDA, EBITDAre, Adjusted EBITDAre, Adjusted Hotel EBITDA and Comparable Hotels Adjusted Hotel EBITDA guidance for the year ending December 31, 2023:

 

Year Ending December 31, 2023

 

Low-End

 

High-End

Net income

$166,973

 

$188,773

Depreciation and amortization

184,000

 

181,000

Amortization of favorable and unfavorable leases, net

405

 

405

Interest and other expense, net

71,000

 

69,000

Income tax expense

700

 

1,100

EBITDA and EBITDAre

$423,078

 

$440,278

Non-cash straight-line operating ground lease expense

145

 

145

Adjusted EBITDAre

$423,223

 

$440,423

General and administrative expense

40,000

 

45,000

AEBITDAre from non-hotel property (1)

(1,000)

 

(2,000)

Adjusted Hotel EBITDA

$462,223

 

$483,423

AHEBITDA from acquisitions prior to ownership (2)

14,603

 

14,603

AHEBITDA from non-hotel property (3)

574

 

574

Comparable Hotels Adjusted Hotel EBITDA

$477,400

 

$498,600

_______________________

(1)  

Represents Adjusted EBITDAre from one non-hotel property for the second half of 2023.

(2)  

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.

(3)  

Represents Adjusted Hotel EBITDA from the Company's independent boutique hotel in New York, New York for the first half of 2023, prior to its lease to a third-party hotel operator for all hotel operations.

Apple Hospitality REIT, Inc.

Debt Summary

(Unaudited)

($ in thousands)

September 30, 2023

 

 

 

October 1 -

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fair Market

 

 

 

2023

 

 

2024

 

 

2025

 

 

2026

 

 

2027

 

 

Thereafter

 

 

Total

 

 

Value

 

Total debt:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Maturities

 

$

2,245

 

 

$

113,597

 

 

$

295,140

 

 

$

74,649

 

 

$

278,602

 

 

$

616,014

 

 

$

1,380,247

 

 

$

1,316,664

 

Average interest rates (1)

 

 

4.3

%

 

 

4.7

%

 

 

5.0

%

 

 

5.3

%

 

 

5.3

%

 

 

5.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Variable-rate debt:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Maturities

 

$

-

 

 

$

85,000

 

 

$

225,000

 

 

$

-

 

 

$

275,000

 

 

$

385,000

 

 

$

970,000

 

 

$

967,526

 

Average interest rates (1)

 

 

4.5

%

 

 

4.9

%

 

 

5.5

%

 

 

5.8

%

 

 

5.9

%

 

 

5.6

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fixed-rate debt:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Maturities

 

$

2,245

 

 

$

28,597

 

 

$

70,140

 

 

$

74,649

 

 

$

3,602

 

 

$

231,014

 

 

$

410,247

 

 

$

349,138

 

Average interest rates

 

 

4.1

%

 

 

4.1

%

 

 

4.0

%

 

 

4.0

%

 

 

4.1

%

 

 

4.1

%

 

 

 

 

 

 

_______________________

(1)  

The average interest rate gives effect to interest rate swaps, as applicable.

Note: See further information on the Company’s indebtedness in the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2023.

Apple Hospitality REIT, Inc.

Comparable Hotels Operating Metrics by Market

Three Months Ended September 30

(Unaudited)

 

Top 20 Markets

 

 

Occupancy

 

ADR

 

RevPAR

 

% of Adjusted

Hotel EBITDA

 

# of Hotels

 

Q3 2023

Q3 2022

% Change

 

Q3 2023

Q3 2022

% Change

 

Q3 2023

Q3 2022

% Change

 

Q3 2023

Top 20 Markets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

San Diego, CA

7

 

81.5%

83.7%

(2.6%)

 

$209.81

$202.53

3.6%

 

$171.05

$169.60

0.9%

 

6.7%

Portland, ME

3

 

93.4%

92.2%

1.3%

 

$310.50

$306.72

1.2%

 

$289.95

$282.70

2.6%

 

6.6%

Los Angeles, CA

8

 

88.4%

86.0%

2.8%

 

$192.58

$189.86

1.4%

 

$170.21

$163.34

4.2%

 

5.6%

Chicago, IL

7

 

76.4%

72.3%

5.7%

 

$146.84

$145.11

1.2%

 

$112.18

$104.87

7.0%

 

4.1%

Seattle, WA

3

 

88.8%

86.1%

3.1%

 

$233.41

$227.93

2.4%

 

$207.23

$196.17

5.6%

 

3.9%

Orange County, CA

6

 

84.0%

81.9%

2.6%

 

$175.13

$180.37

(2.9%)

 

$147.15

$147.64

(0.3%)

 

3.9%

Norfolk/Virginia Beach, VA

4

 

85.3%

85.9%

(0.7%)

 

$230.22

$234.72

(1.9%)

 

$196.28

$201.54

(2.6%)

 

3.5%

Alaska

2

 

93.2%

96.7%

(3.6%)

 

$302.93

$281.70

7.5%

 

$282.23

$272.32

3.6%

 

3.3%

Nashville, TN

5

 

86.9%

80.1%

8.5%

 

$154.30

$163.16

(5.4%)

 

$134.06

$130.66

2.6%

 

2.9%

North Carolina East

4

 

82.3%

76.1%

8.1%

 

$179.48

$179.74

(0.1%)

 

$147.77

$136.77

8.0%

 

2.6%

Fort Worth/Arlington, TX

6

 

76.9%

76.5%

0.5%

 

$151.38

$147.60

2.6%

 

$116.44

$112.89

3.1%

 

2.3%

Phoenix, AZ

10

 

69.1%

64.0%

8.0%

 

$114.42

$111.09

3.0%

 

$79.05

$71.05

11.3%

 

1.9%

Denver, CO

3

 

79.6%

82.2%

(3.2%)

 

$182.89

$172.07

6.3%

 

$145.63

$141.44

3.0%

 

1.9%

Richmond/Petersburg, VA

3

 

68.2%

65.7%

3.8%

 

$178.64

$176.86

1.0%

 

$121.81

$116.28

4.8%

 

1.8%

Melbourne, FL

3

 

78.5%

84.4%

(7.0%)

 

$181.66

$174.58

4.1%

 

$142.61

$147.36

(3.2%)

 

1.8%

Omaha, NE

4

 

69.0%

71.0%

(2.8%)

 

$137.07

$132.60

3.4%

 

$94.54

$94.18

0.4%

 

1.6%

Washington, DC

4

 

76.5%

71.0%

7.7%

 

$143.02

$138.78

3.1%

 

$109.41

$98.55

11.0%

 

1.5%

Indiana North

3

 

77.0%

73.5%

4.8%

 

$167.10

$157.72

5.9%

 

$128.65

$115.86

11.0%

 

1.5%

Alabama North

4

 

81.3%

85.4%

(4.8%)

 

$147.95

$130.58

13.3%

 

$120.26

$111.49

7.9%

 

1.5%

Pittsburgh, PA

2

 

75.5%

73.9%

2.2%

 

$183.52

$188.14

(2.5%)

 

$138.52

$139.09

(0.4%)

 

1.4%

Top 20 Markets

91

 

79.8%

78.1%

2.2%

 

$180.60

$178.07

1.4%

 

$144.07

$139.00

3.6%

 

60.3%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

All Other Markets

129

 

74.9%

73.7%

1.6%

 

$140.58

$139.70

0.6%

 

$105.35

$102.97

2.3%

 

39.7%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Portfolio

220

 

77.1%

75.7%

1.8%

 

$159.36

$157.65

1.1%

 

$122.91

$119.31

3.0%

 

100.0%

Note: Market categorization based on STR designation. Top 20 markets based on Comparable Hotels Adjusted Hotel EBITDA contribution.

Apple Hospitality REIT, Inc.

Comparable Hotels Operating Metrics by Market

Nine Months Ended September 30

(Unaudited)

 

Top 20 Markets

 

 

Occupancy

 

ADR

 

RevPAR

 

% of Adjusted

Hotel EBITDA

 

# of Hotels

 

YTD 2023

YTD 2022

% Change

 

YTD 2023

YTD 2022

% Change

 

YTD 2023

YTD 2022

% Change

 

YTD 2023

Top 20 Markets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

San Diego, CA

7

 

78.2%

77.1%

1.4%

 

$192.65

$180.10

7.0%

 

$150.71

$138.83

8.6%

 

5.8%

Phoenix, AZ

10

 

78.7%

72.1%

9.2%

 

$162.61

$142.64

14.0%

 

$127.95

$102.78

24.5%

 

5.8%

Los Angeles, CA

8

 

85.1%

84.7%

0.5%

 

$187.80

$181.11

3.7%

 

$159.86

$153.45

4.2%

 

5.4%

Orange County, CA

6

 

79.6%

77.1%

3.2%

 

$170.31

$164.74

3.4%

 

$135.59

$127.07

6.7%

 

3.7%

Portland, ME

3

 

76.2%

72.5%

5.1%

 

$231.78

$236.07

(1.8%)

 

$176.51

$171.04

3.2%

 

3.5%

Nashville, TN

5

 

82.1%

79.8%

2.9%

 

$163.43

$164.40

(0.6%)

 

$134.18

$131.21

2.3%

 

3.0%

Seattle, WA

3

 

81.8%

78.6%

4.1%

 

$201.65

$191.68

5.2%

 

$164.93

$150.73

9.4%

 

3.0%

Fort Worth/Arlington, TX

6

 

80.4%

79.2%

1.5%

 

$157.22

$147.19

6.8%

 

$126.42

$116.60

8.4%

 

2.9%

Chicago, IL

7

 

68.3%

63.9%

6.9%

 

$139.73

$133.19

4.9%

 

$95.48

$85.07

12.2%

 

2.6%

Alaska

2

 

85.2%

89.9%

(5.2%)

 

$261.87

$230.57

13.6%

 

$222.99

$207.28

7.6%

 

2.5%

Norfolk/Virginia Beach, VA

4

 

78.6%

79.1%

(0.6%)

 

$185.24

$183.81

0.8%

 

$145.67

$145.32

0.2%

 

2.3%

Richmond/Petersburg, VA

3

 

69.5%

65.7%

5.8%

 

$183.15

$176.70

3.7%

 

$127.22

$116.13

9.5%

 

2.3%

Melbourne, FL

3

 

84.1%

84.6%

(0.6%)

 

$193.27

$173.49

11.4%

 

$162.50

$146.74

10.7%

 

2.3%

Omaha, NE

4

 

70.3%

65.3%

7.7%

 

$156.97

$145.68

7.7%

 

$110.43

$95.19

16.0%

 

2.2%

North Carolina East

4

 

78.2%

73.8%

6.0%

 

$158.12

$157.85

0.2%

 

$123.66

$116.45

6.2%

 

2.0%

Washington, DC

4

 

76.0%

71.9%

5.7%

 

$146.35

$132.46

10.5%

 

$111.20

$95.30

16.7%

 

1.7%

Miami, FL

3

 

88.3%

81.9%

7.8%

 

$160.72

$154.31

4.2%

 

$141.93

$126.45

12.2%

 

1.7%

Austin, TX

7

 

73.6%

72.8%

1.1%

 

$124.30

$124.49

(0.2%)

 

$91.48

$90.68

0.9%

 

1.5%

Oklahoma City, OK

4

 

75.4%

66.2%

13.9%

 

$137.19

$139.72

(1.8%)

 

$103.50

$92.45

12.0%

 

1.5%

Alabama North

4

 

83.1%

82.3%

1.0%

 

$144.16

$127.88

12.7%

 

$119.84

$105.20

13.9%

 

1.5%

Top 20 Markets

97

 

77.9%

74.9%

4.0%

 

$169.88

$161.77

5.0%

 

$132.29

$121.15

9.2%

 

57.2%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

All Other Markets

123

 

73.8%

72.2%

2.2%

 

$145.62

$138.79

4.9%

 

$107.47

$100.23

7.2%

 

42.8%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Portfolio

220

 

75.8%

73.5%

3.1%

 

$157.54

$149.98

5.0%

 

$119.34

$110.23

8.3%

 

100.0%

Note: Market categorization based on STR designation. Top 20 markets based on Comparable Hotels Adjusted Hotel EBITDA contribution.

Apple Hospitality REIT, Inc.

Comparable Hotels Operating Metrics by Region

Three Months Ended September 30

(Unaudited)

 

Region

 

 

Occupancy

 

ADR

 

RevPAR

 

% of Adjusted

Hotel EBITDA

 

# of Hotels

 

Q3 2023

Q3 2022

% Change

 

Q3 2023

Q3 2022

% Change

 

Q3 2023

Q3 2022

% Change

 

Q3 2023

STR Region

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

East North Central

16

 

75.7%

73.0%

3.7%

 

$156.35

$151.74

3.0%

 

$118.35

$110.78

6.8%

 

8.6%

East South Central

27

 

79.2%

76.6%

3.4%

 

$147.50

$145.31

1.5%

 

$116.82

$111.35

4.9%

 

10.3%

Middle Atlantic

12

 

78.8%

77.9%

1.2%

 

$163.16

$161.45

1.1%

 

$128.53

$125.72

2.2%

 

5.9%

Mountain

21

 

75.2%

72.1%

4.3%

 

$135.89

$131.83

3.1%

 

$102.17

$95.01

7.5%

 

7.2%

New England

6

 

87.9%

88.5%

(0.7%)

 

$259.91

$252.50

2.9%

 

$228.49

$223.53

2.2%

 

7.8%

Pacific

32

 

84.7%

84.1%

0.7%

 

$202.25

$200.22

1.0%

 

$171.32

$168.32

1.8%

 

26.0%

South Atlantic

53

 

76.0%

74.7%

1.7%

 

$151.08

$152.31

(0.8%)

 

$114.86

$113.85

0.9%

 

19.8%

West North Central

17

 

72.0%

72.6%

(0.8%)

 

$142.08

$138.25

2.8%

 

$102.37

$100.30

2.1%

 

5.6%

West South Central

36

 

71.4%

69.8%

2.3%

 

$129.33

$127.69

1.3%

 

$92.41

$89.18

3.6%

 

8.8%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Portfolio

220

 

77.1%

75.7%

1.8%

 

$159.36

$157.65

1.1%

 

$122.91

$119.31

3.0%

 

100.0%

Note: Region categorization based on STR designation.

Apple Hospitality REIT, Inc.

Comparable Hotels Operating Metrics by Region

Nine Months Ended September 30

(Unaudited)

 

Region

 

 

Occupancy

 

ADR

 

RevPAR

 

% of Adjusted

Hotel EBITDA

 

# of Hotels

 

YTD 2023

YTD 2022

% Change

 

YTD 2023

YTD 2022

% Change

 

YTD 2023

YTD 2022

% Change

 

YTD 2023

STR Region

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

East North Central

16

 

67.6%

64.6%

4.6%

 

$145.98

$137.49

6.2%

 

$98.67

$88.81

11.1%

 

5.8%

East South Central

27

 

78.2%

75.9%

3.0%

 

$149.01

$144.07

3.4%

 

$116.56

$109.32

6.6%

 

10.6%

Middle Atlantic

12

 

74.1%

71.6%

3.5%

 

$154.55

$148.93

3.8%

 

$114.58

$106.58

7.5%

 

5.1%

Mountain

21

 

78.4%

74.4%

5.4%

 

$155.47

$140.08

11.0%

 

$121.86

$104.28

16.9%

 

10.8%

New England

6

 

73.6%

73.3%

0.4%

 

$206.35

$199.89

3.2%

 

$151.84

$146.42

3.7%

 

4.4%

Pacific

32

 

80.5%

79.4%

1.4%

 

$189.44

$180.60

4.9%

 

$152.49

$143.49

6.3%

 

23.2%

South Atlantic

53

 

77.2%

75.3%

2.5%

 

$155.66

$149.23

4.3%

 

$120.16

$112.37

6.9%

 

23.1%

West North Central

17

 

69.8%

68.1%

2.5%

 

$144.71

$135.35

6.9%

 

$101.00

$92.13

9.6%

 

5.6%

West South Central

36

 

73.6%

70.5%

4.4%

 

$134.72

$129.60

4.0%

 

$99.13

$91.43

8.4%

 

11.4%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Portfolio

220

 

75.8%

73.5%

3.1%

 

$157.54

$149.98

5.0%

 

$119.34

$110.23

8.3%

 

100.0%

Note: Region categorization based on STR designation.

Apple Hospitality REIT, Inc.

Comparable Hotels Operating Metrics by Chain Scale

Three Months Ended September 30

(Unaudited)

 

Chain Scale/Brand

 

 

Occupancy

 

ADR

 

RevPAR

 

% of Adjusted

Hotel EBITDA

 

# of Hotels

 

Q3 2023

Q3 2022

% Change

 

Q3 2023

Q3 2022

% Change

 

Q3 2023

Q3 2022

% Change

 

Q3 2023

Upscale

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AC Hotels

3

 

84.0%

86.7%

(3.1%)

 

$270.09

$253.02

6.7%

 

$226.95

$219.33

3.5%

 

4.7%

Aloft

1

 

90.9%

89.2%

1.9%

 

$269.79

$280.99

(4.0%)

 

$245.36

$250.55

(2.1%)

 

1.5%

Courtyard

34

 

75.5%

73.3%

3.0%

 

$171.58

$169.42

1.3%

 

$129.60

$124.13

4.4%

 

19.2%

Hilton Garden Inn

40

 

74.5%

74.6%

(0.1%)

 

$152.06

$151.46

0.4%

 

$113.25

$113.02

0.2%

 

17.3%

Homewood Suites

30

 

82.4%

80.3%

2.6%

 

$147.37

$143.93

2.4%

 

$121.49

$115.60

5.1%

 

9.9%

Hyatt House

1

 

68.7%

62.2%

10.5%

 

$124.55

$116.29

7.1%

 

$85.58

$72.32

18.3%

 

0.2%

Hyatt Place

3

 

73.4%

71.3%

2.9%

 

$128.12

$124.69

2.8%

 

$94.00

$88.95

5.7%

 

0.7%

Residence Inn

29

 

83.4%

81.4%

2.5%

 

$174.53

$170.71

2.2%

 

$145.58

$138.99

4.7%

 

16.7%

SpringHill Suites

9

 

74.5%

68.4%

8.9%

 

$142.55

$137.86

3.4%

 

$106.20

$94.33

12.6%

 

3.3%

Upscale Total

150

 

78.0%

76.4%

2.1%

 

$163.05

$160.46

1.6%

 

$127.22

$122.55

3.8%

 

73.5%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Upper Midscale

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fairfield

10

 

71.4%

68.7%

3.9%

 

$130.96

$128.85

1.6%

 

$93.50

$88.54

5.6%

 

2.6%

Hampton

37

 

75.0%

73.7%

1.8%

 

$151.19

$153.50

(1.5%)

 

$113.36

$113.05

0.3%

 

13.8%

Home2 Suites

10

 

86.6%

83.9%

3.2%

 

$156.83

$161.18

(2.7%)

 

$135.77

$135.16

0.5%

 

4.8%

TownePlace Suites

9

 

74.0%

78.7%

(6.0%)

 

$119.69

$119.09

0.5%

 

$88.52

$93.75

(5.6%)

 

2.1%

Upper Midscale Total

66

 

75.9%

74.9%

1.3%

 

$145.82

$147.28

(1.0%)

 

$110.75

$110.34

0.4%

 

23.3%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Upper Upscale

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Embassy Suites

2

 

86.3%

91.1%

(5.3%)

 

$260.74

$234.97

11.0%

 

$225.03

$214.09

5.1%

 

2.4%

Marriott

2

 

59.7%

55.7%

7.2%

 

$159.88

$155.81

2.6%

 

$95.39

$86.82

9.9%

 

0.8%

Upper Upscale Total

4

 

68.7%

67.7%

1.5%

 

$202.72

$191.82

5.7%

 

$139.20

$129.83

7.2%

 

3.2%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Portfolio

220

 

77.1%

75.7%

1.8%

 

$159.36

$157.65

1.1%

 

$122.91

$119.31

3.0%

 

100.0%

Note: Chain scale categorization based on STR designation.

Apple Hospitality REIT, Inc.

Comparable Hotels Operating Metrics by Chain Scale

Nine Months Ended September 30

(Unaudited)

 

Chain Scale/Brand

 

 

Occupancy

 

ADR

 

RevPAR

 

% of Adjusted

Hotel EBITDA

 

# of Hotels

 

YTD 2023

YTD 2022

% Change

 

YTD 2023

YTD 2022

% Change

 

YTD 2023

YTD 2022

% Change

 

YTD 2023

Upscale

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AC Hotels

3

 

76.0%

72.9%

4.3%

 

$220.55

$210.49

4.8%

 

$167.70

$153.51

9.2%

 

3.2%

Aloft

1

 

72.5%

64.8%

11.9%

 

$203.63

$226.92

(10.3%)

 

$147.63

$146.94

0.5%

 

0.7%

Courtyard

34

 

73.7%

70.8%

4.1%

 

$164.40

$156.80

4.8%

 

$121.18

$110.97

9.2%

 

18.4%

Hilton Garden Inn

40

 

73.0%

70.7%

3.3%

 

$152.45

$146.39

4.1%

 

$111.36

$103.46

7.6%

 

17.3%

Homewood Suites

30

 

82.2%

81.3%

1.1%

 

$151.15

$143.02

5.7%

 

$124.22

$116.30

6.8%

 

11.6%

Hyatt House

1

 

77.3%

71.0%

8.9%

 

$172.20

$141.56

21.6%

 

$133.09

$100.48

32.5%

 

0.5%

Hyatt Place

3

 

77.8%

73.1%

6.4%

 

$149.16

$139.64

6.8%

 

$116.05

$102.06

13.7%

 

1.2%

Residence Inn

29

 

79.0%

79.4%

(0.5%)

 

$165.96

$157.14

5.6%

 

$131.08

$124.82

5.0%

 

14.7%

SpringHill Suites

9

 

74.9%

69.4%

7.9%

 

$144.56

$134.53

7.5%

 

$108.23

$93.37

15.9%

 

3.4%

Upscale Total

150

 

76.2%

74.1%

2.8%

 

$159.09

$151.43

5.1%

 

$121.16

$112.20

8.0%

 

71.0%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Upper Midscale

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fairfield

10

 

71.2%

67.9%

4.9%

 

$132.08

$126.45

4.5%

 

$94.05

$85.83

9.6%

 

2.7%

Hampton

37

 

73.8%

70.6%

4.5%

 

$155.99

$149.55

4.3%

 

$115.14

$105.56

9.1%

 

15.1%

Home2 Suites

10

 

85.4%

82.5%

3.5%

 

$161.08

$153.20

5.1%

 

$137.49

$126.37

8.8%

 

5.1%

TownePlace Suites

9

 

77.6%

80.0%

(3.0%)

 

$123.60

$118.87

4.0%

 

$95.91

$95.10

0.9%

 

2.6%

Upper Midscale Total

66

 

75.5%

72.9%

3.6%

 

$149.71

$143.16

4.6%

 

$112.97

$104.37

8.2%

 

25.5%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Upper Upscale

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Embassy Suites

2

 

85.3%

88.6%

(3.7%)

 

$239.60

$212.04

13.0%

 

$204.32

$187.89

8.7%

 

2.1%

Marriott

2

 

61.8%

54.6%

13.2%

 

$166.29

$157.14

5.8%

 

$102.75

$85.84

19.7%

 

1.4%

Upper Upscale Total

4

 

69.7%

66.1%

5.4%

 

$196.59

$182.00

8.0%

 

$137.08

$120.33

13.9%

 

3.5%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Portfolio

220

 

75.8%

73.5%

3.1%

 

$157.54

$149.98

5.0%

 

$119.34

$110.23

8.3%

 

100.0%

Note: Chain scale categorization based on STR designation.

Apple Hospitality REIT, Inc.

Comparable Hotels Operating Metrics by Location

Three Months Ended September 30

(Unaudited)

 

Location

 

 

Occupancy

 

ADR

 

RevPAR

 

% of Adjusted

Hotel EBITDA

 

# of Hotels

 

Q3 2023

Q3 2022

% Change

 

Q3 2023

Q3 2022

% Change

 

Q3 2023

Q3 2022

% Change

 

Q3 2023

STR Location

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Airport

18

 

79.8%

77.0%

3.6%

 

$134.73

$133.98

0.6%

 

$107.50

$103.10

4.3%

 

5.5%

Interstate

4

 

72.6%

72.8%

(0.3%)

 

$122.26

$117.28

4.2%

 

$88.73

$85.42

3.9%

 

1.1%

Resort

11

 

72.2%

72.7%

(0.7%)

 

$176.03

$180.21

(2.3%)

 

$127.08

$130.94

(2.9%)

 

5.7%

Small Metro/Town

11

 

77.4%

74.3%

4.2%

 

$127.60

$121.21

5.3%

 

$98.78

$90.02

9.7%

 

3.4%

Suburban

125

 

77.6%

76.3%

1.7%

 

$153.81

$150.99

1.9%

 

$119.40

$115.18

3.7%

 

49.2%

Urban

51

 

76.6%

75.1%

2.0%

 

$182.19

$181.96

0.1%

 

$139.48

$136.66

2.1%

 

35.1%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Portfolio

220

 

77.1%

75.7%

1.8%

 

$159.36

$157.65

1.1%

 

$122.91

$119.31

3.0%

 

100.0%

Note: Location categorization based on STR designation.

Apple Hospitality REIT, Inc.

Comparable Hotels Operating Metrics by Location

Nine Months Ended September 30

(Unaudited)

 

Location

 

 

Occupancy

 

ADR

 

RevPAR

 

% of Adjusted

Hotel EBITDA

 

# of Hotels

 

YTD 2023

YTD 2022

% Change

 

YTD 2023

YTD 2022

% Change

 

YTD 2023

YTD 2022

% Change

 

YTD 2023

STR Location

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Airport

18

 

80.7%

78.2%

3.2%

 

$144.86

$135.04

7.3%

 

$116.88

$105.59

10.7%

 

7.0%

Interstate

4

 

70.7%

68.2%

3.7%

 

$119.87

$116.05

3.3%

 

$84.79

$79.20

7.1%

 

1.0%

Resort

11

 

75.7%

73.8%

2.6%

 

$175.85

$171.85

2.3%

 

$133.19

$126.81

5.0%

 

6.4%

Small Metro/Town

11

 

79.5%

76.4%

4.1%

 

$141.17

$125.88

12.1%

 

$112.24

$96.16

16.7%

 

4.5%

Suburban

125

 

75.7%

74.2%

2.0%

 

$150.64

$143.16

5.2%

 

$114.09

$106.29

7.3%

 

48.1%

Urban

51

 

74.0%

70.4%

5.1%

 

$176.76

$170.64

3.6%

 

$130.80

$120.16

8.9%

 

33.0%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Portfolio

220

 

75.8%

73.5%

3.1%

 

$157.54

$149.98

5.0%

 

$119.34

$110.23

8.3%

 

100.0%

Note: Location categorization based on STR designation.

 

Contacts

Apple Hospitality REIT, Inc.

Kelly Clarke, Vice President, Investor Relations

804-727-6321

kclarke@applereit.com

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