“Our same-store and pro forma (excluding New Orleans) RevPAR growth for the quarter was at or above comparable STR results,” Hansen stated. “We previously noted the significant RevPAR growth in 2012 would create difficult RevPAR comparisons for the second half of 2013. Our same-store hotels generated 12.9 percent and 15.3 percent RevPAR growth in the third and fourth quarters of 2012, respectively.”

 

Q3 2013 Overall STR 1 Results
    Occupancy   ADR   RevPAR
Overall US   1.4%   4.0%   5.5%
Upscale   0.9%   4.3%   5.3%
Upper Midscale   1.2%   3.0%   4.2%
     

1 STR Quarterly Hotel Review, Volume 13, Issue Q3

Year-to-Date Highlights
  • Same-Store RevPAR: Same-store RevPAR in the first nine months of 2013 grew to $75.80, an increase of 7.2 percent over the same period in 2012. Same-store ADR grew to $102.74, an increase of 5.3 percent from the first nine months of 2012. Same-store occupancy grew by 135 basis points to 73.8 percent.
  • Pro Forma RevPAR: Pro forma RevPAR in the first nine months of 2013 grew to $83.76, an increase of 5.2 percent over the same period in 2012. Pro forma ADR grew to $112.50, an increase of 4.4 percent from the first nine months of 2012. Pro forma occupancy grew by 57 basis points to 74.4 percent. Pro forma RevPAR grew by 6.1 percent, ADR grew by 4.6 percent and occupancy increased by 104 basis points in the first nine months of 2013, when excluding the five hotels in the New Orleans market acquired in the first quarter of 2013.
  • Pro Forma Hotel EBITDA: Pro forma hotel EBITDA for the first nine months of 2013 was $87.2 million, an increase of 7.1 percent over the same period of 2012.
  • Pro Forma Hotel EBITDA Margin: Pro forma hotel EBITDA margin expanded 67 basis points compared with the same period in 2012. When excluding the New Orleans portfolio, pro forma hotel EBITDA margin expansion was 91 basis points for the first nine months of 2013.
  • Adjusted EBITDA: Adjusted EBITDA increased to $72.0 million from $40.7 million in the same period in 2012, an increase of $31.3 million or 76.8 percent. Adjusted EBITDA for the first nine months of 2013 includes $0.4 million of charges associated with the consolidation of the Company’s corporate office to Austin, Texas.
  • Adjusted FFO: Adjusted FFO for the first nine months of 2013 was $47.3 million or $0.69 per diluted unit.
  • Acquisitions: During the first nine months of 2013, the Company acquired 16 hotels comprising 2,597 guestrooms, for a total purchase price of $414.2 million.

Capital Markets

During the third quarter of 2013, the Company raised $152.2 million in net proceeds from a common stock offering.
  • On September 19, 2013, the Company completed an underwritten public offering of 17,250,000 shares of common stock at a public price of $9.20 per share, including 2,250,000 shares issued pursuant to the underwriters’ over-allotment option. Net proceeds of approximately $152.2 million were realized after deducting the underwriting discount and other offering expenses.

During the third quarter of 2013, the Company closed on $80.1 million in debt financing including the following transactions:
  • On July 22, 2013, the Company closed on a $38.7 million CMBS loan with KeyBank, N.A. secured by the two recent Louisville, Ky. acquisitions, the Courtyard by Marriott and the Fairfield Inn & Suites. This loan matures on August 1, 2023 and bears interest at a fixed rate of 4.95 percent. Proceeds from the loan were used to pay down the $92.0 million senior secured interim loan with KeyBank, N.A.
  • On July 26, 2013, the Company closed on a $7.4 million term loan with Metabank secured by the Hyatt Place in Atlanta, Ga. This loan matures on August 1, 2018 and bears interest at a fixed rate of 4.25 percent. Proceeds from the loan were used to pay down the $150.0 million senior secured revolving credit facility.
  • On August 1, 2013, the Company closed on a $34.0 million term loan with ING Life Insurance and Annuity. This loan matures on August 1, 2038 and bears interest at a fixed rate of 4.55 percent. ING has the right to call the loan in full on March 1, 2019, 2024, 2029 and 2034. Proceeds from the loan were used to pay down the $150.0 million senior secured revolving credit facility.

Capital Investment

Acquisitions

During the third quarter of 2013, the Company announced four pending acquisitions including: the 115-guestroom Hampton Inn & Suites, Ventura (Camarillo), Calif.; the 108-guestroom Hampton Inn & Suites, San Diego (Poway), Calif.; the 98-guestroom Hampton Inn, Santa Barbara (Goleta), Calif.; and the 182-guestroom Hilton Garden Inn, Houston, Texas.

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