All amounts presented in this news release are in
2024 FIRST QUARTER HIGHLIGHTS
- Diluted FFO per unit (1) and normalized diluted FFO per unit (1) were
$0.03 and$0.02 , respectively, for the first quarter of 2024, compared to$0.11 and$0.07 for the same period of 2023. - Occupancy (1) was 66.4% for the first quarter of 2024, an increase of 230 basis points (“bps”) compared to 64.1% for the same period of 2023.
- ADR (1) decreased 0.8% to
$131 for the first quarter of 2024, compared to$132 for the same period of 2023. - Revenue increased 1.6% to
$66.5 million for the first quarter of 2024, compared to$65.5 million for the same period in 2023. - NOI and normalized NOI (1) were
$17.2 million and$17.3 million , respectively, for the first quarter of 2024, decreases of 8.0% and 12.2%, respectively, compared to$18.7 million and$19.7 million for the same period in 2023. - AHIP had
$25.5 million in available liquidity as atMarch 31, 2024 , compared to$27.8 million as atDecember 31, 2023 . The available liquidity of$25.5 million was comprised of an unrestricted cash balance of$15.5 million and borrowing availability of$10.0 million under the revolving credit facility.
“AHIP’s portfolio of premium branded select service hotel properties continued to demonstrate strong demand metrics in 2024.” said
2024 FIRST QUARTER REVIEW
FINANCIAL AND OPERATIONAL HIGHLIGHTS
For the three months ended
The improved RevPAR is attributable to higher demand for the extended stay and select service properties. This is primarily due to improved performance of properties disrupted in 2023 by the weather-related damage and renovation at three hotels, as well as the disposition of properties with lower-than-average portfolio RevPAR. Excluding the hotels disrupted in the first quarter of 2023 and properties sold since the first quarter of 2023, ADR and occupancy decreased by less than 1.0%, and RevPAR decreased by 1.6%, compared to the same period in the prior year.
The ability to control and manage daily rates is a key advantage of the lodging sector, which has enabled AHIP to achieve growth in RevPAR, partially mitigating the effects of rising labor costs and general inflationary pressures across the portfolio.
NOI,
NOI and normalized NOI (1) were
Diluted FFO per unit and normalized diluted FFO per unit (1) were
LEVERAGE AND LIQUIDITY
KPIs | Q1 2024 | Q4 2023 | Q3 2023 | Q2 2023 | Q1 2023 |
Debt-to-GBV (1) | 52.2% | 51.9% | 51.1% | 51.6% | 52.0% |
Debt-to-TTM EBITDA (1) | 10.5x | 10.6x | 10.1x | 9.8x | 9.6x |
Debt to gross book value as at
As at
AHIP has 70.6% of its debt at fixed interest rates following the expiry of the interest rate swaps on its senior credit facility on
CAPITAL RECYCLING
In
In March and
AHIP will continue to execute its strategy to divest assets to reduce debt and is currently marketing a selected number of additional properties which are expected to demonstrate value above the current unit trading price.
SAME PROPERTY KPI
The following table summarizes key performance indicators (“KPIs”) for the portfolio for the five most recent quarters with a comparison to the same period in the prior year.
KPIs | Q1 2024 | Q4 2023 | Q3 2023 | Q2 2023 | Q1 2023 |
ADR | $132 | ||||
Change compared to same period in prior year - % increase/(decrease) | (0.8%) | - | 2.7% | 5.3% | 11.4% |
Occupancy | 67.3% | 66.9% | 71.6% | 74.4% | 66.3% |
Change compared to same period in prior year - bps increase/(decrease) | 100 | (83) | (223) | (5) | 53 |
RevPAR | $89 | ||||
Change compared to same period in prior year - % increase/(decrease) | 1.1% | (1.3%) | (0.4%) | 4.5% | 12.3% |
NOI Margin | 26.9% | 26.1% | 30.5% | 33.3% | 29.4% |
Change compared to same period in prior year - bps decrease | (250) | (514) | (275) | (212) | (19) |
Same property ADR in the current quarter is
Same property NOI margin decreased by 250 bps to 26.9% for the first quarter of 2024, compared to the same period in 2023. The decrease in the same property NOI margin was mainly due to higher operating expenses as a result of cost inflation, escalated labor costs, and higher property insurance premiums. The labor environment is improving although labor is expected to remain a challenge in 2024 with increased turnover and hourly wage costs.
SELECTED INFORMATION
Three months ended | |||||||
(thousands of dollars, except per Unit amounts) | 2024 | 2023 | |||||
Revenue | 66,489 | 65,458 | |||||
Income from operating activities | 7,569 | 9,418 | |||||
Loss and comprehensive loss | (8,109 | ) | (1,600 | ) | |||
NOI | 17,190 | 18,738 | |||||
NOI Margin (1) | 25.9 | % | 28.6 | % | |||
15,673 | 16,602 | ||||||
23.6 | % | 25.4 | % | ||||
EBITDA (1) | 13,320 | 14,044 | |||||
EBITDA Margin (1) | 20.0 | % | 21.5 | % | |||
Cashflow from operating activities | 43 | 13,094 | |||||
Distributions declared per unit - basic and diluted | - | 0.045 | |||||
Distributions declared to unitholders - basic | - | 3,546 | |||||
Distributions declared to unitholders - diluted | - | 4,026 | |||||
Dividends declared to Series C holders | 1,099 | 1,000 | |||||
FFO diluted (1) | 2,334 | 9,801 | |||||
FFO per unit - diluted (1) | 0.03 | 0.11 | |||||
Normalized FFO per unit - diluted (1) | 0.02 | 0.02 | |||||
AFFO diluted (1) | (668 | ) | 7,081 | ||||
AFFO per unit - diluted (1) | (0.01 | ) | 0.08 | ||||
(1) See “Non-IFRS and Other Financial Measures” |
SELECTED INFORMATION
(thousands of dollars) | 2024 | 2023 | ||||
Total assets | 929,771 | 954,887 | ||||
Total liabilities | 705,975 | 721,937 | ||||
Total non-current liabilities | 527,201 | 529,178 | ||||
Term loans and revolving credit facility | 567,602 | 599,873 | ||||
Debt to gross book value (1) | 52.2 | % | 51.9 | % | ||
Debt to EBITDA (times) (1) | 10.5 | 10.6 | ||||
Interest coverage ratio (times) (1) | 1.8 | 1.9 | ||||
Term loans and revolving credit facility: | ||||||
Weighted average interest rate | 5.79 | % | 4.95 | % | ||
Weighted average term to maturity (years) | 2.1 | 2.2 | ||||
Number of rooms | 7,662 | 7,917 | ||||
Number of properties | 68 | 70 | ||||
Number of restaurants | 14 | 14 | ||||
(1) See “Non-IFRS and Other Financial Measures” |
2024 FIRST QUARTER OPERATING RESULTS
Three months ended | ||||||
(thousands of dollars) | 2024 | 2023 | ||||
ADR (1) | 131 | 132 | ||||
Occupancy (1) | 66.4 | % | 64.1 | % | ||
RevPAR (1) | 87 | 85 | ||||
Revenue | 66,489 | 65,458 | ||||
Operating expenses | 36,389 | 35,526 | ||||
Energy | 2,990 | 3,222 | ||||
Property maintenance | 4,219 | 3,524 | ||||
Property taxes, insurance and ground lease before IFRIC 21 | 5,701 | 4,448 | ||||
Total expenses | 49,299 | 46,720 | ||||
NOI | 17,190 | 18,738 | ||||
NOI Margin % (1) | 25.9 | % | 28.6 | % | ||
IFRIC 21 property taxes adjustment | 892 | 699 | ||||
Depreciation and amortization | 8,729 | 8,621 | ||||
Income from operating activities | 7,569 | 9,418 | ||||
Other expenses | 17,411 | 12,427 | ||||
Current income tax expense | 87 | 16 | ||||
Deferred income tax recovery | (1,820 | ) | (1,425 | ) | ||
Loss and comprehensive loss | (8,109 | ) | (1,600 | ) | ||
(1) See “Non-IFRS and Other Financial Measures” |
INITIATIVES TO STRENGTHEN FINANCIAL POSITION AND PRESERVE UNITHOLDER VALUE
The Board of Directors (the “Board”), together with management, have implemented a plan to strengthen AHIP’s financial position and to preserve unitholder value. Initiatives, both planned and underway, are outlined below.
PLAN TO ADDRESS NEAR TERM LOAN MATURITIES
AHIP is in the process of executing its plan to address the Company’s near-term debt maturities in 2024, while creating modest improvements in ADR, RevPAR and leverage metrics.
The commercial mortgage-backed securities (“CMBS”) loan maturities are
To address the Q2 2024 CMBS loan maturity of
- AHIP completed the strategic disposition of a hotel property in
Harrisonburg, Virginia for$8.55 million . The net proceeds were used to partially satisfy the non-recourse mortgage debt; and - AHIP completed the CMBS refinancing for the remaining three assets secured against this loan with gross proceeds of
$17.5 million prior to initial capital reserves contribution of approximately$5.0 million . The term of this new CMBS loan is five years at a fixed annual interest rate of 7.8%.
To address the Q4 2024 CMBS loan maturities of
- In March and
April 2024 , AHIP entered into agreements to dispose of two non-core hotel properties inAmarillo, Texas for$9.3 million and$8.3 million , respectively. The dispositions are expected to close in the third quarter of 2024. In addition, AHIP is currently marketing non-core hotel properties in each ofAmarillo andDallas, Texas ; and - AHIP expects to refinance a
$24.9 million CMBS loan secured against four hotel properties inFlorida andNorth Carolina before its maturity date in the fourth quarter of 2024.
NORTHEAST PORTFOLIO III CMBS LOAN
During the first quarter of 2024, AHIP notified the loan servicer for the AHIP Northeast Portfolio III CMBS Loan (“Loan Portfolio” or “CMBS Loan”) of an imminent change in circumstances which resulted in the master servicer issuing a notice of default as well as a notice of acceleration and demand for payment on
AMENDMENT OF THE MASTER HOTEL MANAGEMENT AGREEMENT WITH REDUCED AND DEFERRED FEES
On
In accordance with the Amendment, the management fee on certain hotel properties has been reduced or deferred. The reduction of management fees is estimated to provide approximately
For further details, see a copy of the amendment to the master hotel management agreement, which has been filed under AHIP’s profile on SEDAR+ at www.sedarplus.com.
TEMPORARY SUSPENSION OF
From
The amendment of the distribution policy reduces cash payments by
FINANCIAL INFORMATION
This news release should be read in conjunction with AHIP’s unaudited condensed consolidated interim financial statements, and management’s discussion and analysis for the three months ended
Q1 2024 CONFERENCE CALL
Management will host a webcast and conference call at
To participate in the conference call, participants should register online via AHIP’s website. A dial-in and unique PIN will be provided to join the call. Participants are requested to register a minimum of 15 minutes before the start of the call. An audio webcast of the conference call may be accessed on AHIP’s website at www.ahipreit.com.
ABOUT
NON-IFRS AND OTHER FINANCIAL MEASURES
Management believes the following non-IFRS financial measures, non-IFRS ratios, capital management measures and supplementary financial measures are relevant measures to monitor and evaluate AHIP’s financial and operating performance. These measures and ratios do not have any standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other issuers. These measures and ratios are included to provide investors and management additional information and alternative methods for assessing AHIP’s financial and operating results and should not be considered in isolation or as a substitute for performance measures prepared in accordance with IFRS.
NON-IFRS FINANCIAL MEASURES:
FFO: FFO measures operating performance and is calculated in accordance with
AFFO: AFFO is defined as a recurring economic earnings measure and calculated in accordance with REALPAC’s definition. AFFO – basic is calculated as FFO – basic less maintenance capital expenditures. AFFO – diluted is calculated as FFO – diluted less maintenance capital expenditures. The most comparable IFRS measure to AFFO is income (loss) and comprehensive income (loss), for which a reconciliation is provided in this news release.
Normalized FFO: calculated as FFO adjusting for non-recurring items. For the three months ended
Normalized NOI: calculated as NOI adjusting for non-recurring items. For the three months ended
EBITDA: calculated by adjusting NOI for management fees for hotel and general administrative expenses. The sum of management fees for hotel and general administrative expenses is equal to corporate and administrative expenses in the Financial Statements. The most comparable IFRS measure to EBITDA is NOI, for which a reconciliation is provided in this news release.
Debt: calculated as the sum of term loans and revolving credit facility, the face value of convertible debentures, unamortized portion of debt financing costs, lease liabilities and unamortized portion of mark-to-market adjustments. The most comparable IFRS measure to debt is total liabilities, for which a reconciliation is provided in this news release.
Gross book value: calculated as the sum of total assets, accumulated depreciation and impairment on property, buildings and equipment, and accumulated amortization on intangible assets. The most comparable IFRS measure to gross book value is total assets, for which a reconciliation is provided in this news release.
Interest expense: calculated by adjusting finance costs for gain/loss on debt settlement, amortization of debt financing costs, accretion of debenture liability, amortization of debenture costs, dividends on series B preferred shares and amortization of mark-to-market adjustments, accretion of management fee because interest expense excludes certain non-cash accounting items and dividends on preferred shares. The most comparable IFRS measure to interest expense is finance costs, for which a reconciliation is provided in this news release.
NON-IFRS RATIOS:
FFO per unit – basic/diluted: calculated as FFO – basic/diluted divided by weighted average number of units outstanding - basic/diluted respectively for the reporting periods.
Normalized FFO per unit – basic/diluted: calculated as normalized FFO – basic/diluted divided by weighted average number of units outstanding - basic/diluted respectively for the reporting periods.
AFFO per unit – basic/diluted: calculated as AFFO – basic/diluted divided by weighted average number of units outstanding - basic/diluted respectively for the reporting periods.
NOI margin: calculated as NOI divided by total revenue.
EBITDA margin: calculated as EBITDA divided by total revenue.
CAPITAL MANAGEMENT MEASURES:
Debt to gross book value: calculated as debt divided by gross book value. Debt to gross book value is a primary measure of capital management and leverage.
Debt to EBITDA: calculated as debt divided by the trailing twelve months of EBITDA. Debt to EBITDA measures the amount of income generated and available to pay down debt before covering interest, taxes, depreciation, and amortization expenses.
Interest coverage ratio: calculated as EBITDA divided by interest expense for the trailing twelve months. The interest coverage ratio is a measure of AHIP’s ability to service the interest requirements of its outstanding debt.
SUPPLEMENTARY FINANCIAL MEASURES:
Occupancy is a major driver of room revenue as well as food and beverage revenues. Fluctuations in occupancy are accompanied by fluctuations in most categories of variable hotel operating expenses, including housekeeping and other labor costs. ADR also helps to drive room revenue with limited impact on other revenues. Fluctuations in ADR are accompanied by fluctuations in limited categories of hotel operating expenses, such as franchise fees and credit card commissions, since variable hotel operating expenses, such as labor costs, generally do not increase or decrease correspondingly. Thus, increases in RevPAR attributable to increases in occupancy typically reduce EBITDA and EBITDA margins, while increases in RevPAR attributable to increases in ADR typically result in increases in EBITDA and EBITDA margins.
Occupancy: calculated as total number of hotel rooms sold divided by total number of rooms available for the reporting periods. Occupancy is a metric commonly used in the hotel industry to measure the utilization of hotels’ available capacity.
Average daily rate (“ADR”): calculated as total room revenue divided by total number of rooms sold for the reporting periods. ADR is a metric commonly used in the hotel industry to indicate the average revenue earned per occupied room in a given time period.
Revenue per available room (“RevPAR”): calculated as occupancy multiplied by ADR for the reporting periods.
Same property occupancy, ADR, RevPAR, revenue, expense, NOI and NOI margin: measured for properties owned by AHIP for both the current reporting periods and the same periods in 2023. In Q1 2023 and Q2 2023, the same property ADR, occupancy, RevPAR and NOI margin calculations excluded three hotel properties, which is comprised of one hotel in respect of which AHIP is in a managed foreclosure process as of
NON-IFRS RECONCILIATION
The following table reconciles FFO to income (loss) and comprehensive income (loss), the most comparable IFRS measure as presented in the financial statements:
Three months ended | |||||
(thousands of dollars, except per unit amounts) | 2024 | 2023 | |||
Loss and comprehensive loss | (8,109 | ) | (1,600 | ) | |
Adjustments: | |||||
Income attributable to non-controlling interest | (1,099 | ) | (1,000 | ) | |
Depreciation and amortization | 8,729 | 8,621 | |||
Write-off of property, building and equipment | - | 3,892 | |||
Gain on sale of properties | (242 | ) | - | ||
IFRIC 21 property taxes adjustment | 892 | 699 | |||
Change in fair value of interest rate swap contracts | - | 1,091 | |||
Change in fair value of warrants | (120 | ) | (1,570 | ) | |
Impairment of cash-generating units | 4,103 | - | |||
Deferred income tax recovery | (1,820 | ) | (1,425 | ) | |
FFO basic (1) | 2,334 | 8,708 | |||
Interest, accretion and amortization on convertible debentures | - | 1,093 | |||
FFO diluted (1) | 2,334 | 9,801 | |||
FFO per unit – basic (1) | 0.03 | 0.11 | |||
FFO per unit – diluted (1) | 0.03 | 0.11 | |||
Non-recurring items: | |||||
Other income | (1,102 | ) | (3,342 | ) | |
Measurements excluding non-recurring items: | |||||
Normalized FFO diluted (1) | 1,232 | 6,459 | |||
Normalized FFO per unit – diluted (1) | 0.02 | 0.07 | |||
Weighted average number of units outstanding: | |||||
Basic (000’s) | 79,045 | 78,800 | |||
Diluted (000’s) (2) | 79,930 | 89,466 |
(1) | See “Non-IFRS and Other Financial Measures”. |
(2) | The calculation of FFO diluted, FFO per unit – diluted, normalized FFO diluted, normalized FFO per unit – diluted, weighted average number of units outstanding - diluted for the three months ended |
RECONCILIATION OF FFO TO AFFO
Three months ended | |||||
(thousands of dollars, except per Unit amounts) | 2024 | 2023 | |||
FFO basic (1) | 2,334 | 8,708 | |||
FFO diluted (1) | 2,334 | 9,801 | |||
Maintenance capital expenditures | (3,002 | ) | (2,720 | ) | |
AFFO basic (1) | (668 | ) | 5,988 | ||
AFFO diluted (1) | (668 | ) | 7,081 | ||
AFFO per unit - basic (1) | (0.01 | ) | 0.08 | ||
AFFO per unit - diluted (1) | (0.01 | ) | 0.08 | ||
Measurements excluding non-recurring items: | |||||
AFFO diluted (1) | (1,770 | ) | 3,739 | ||
AFFO per unit - diluted (1) | (0.02 | ) | 0.04 |
(1) | See “Non-IFRS and Other Financial Measures” |
DEBT TO GROSS BOOK VALUE
(thousands of dollars) | ||||||
Debt | 675,014 | 688,585 | ||||
Gross Book Value | 1,292,654 | 1,326,070 | ||||
Debt-to-Gross Book Value | 52.2 | % | 51.9 | % | ||
(thousands of dollars) | ||||||
Term loans and revolving credit facility | 620,074 | 633,298 | ||||
2026 Debentures (at face value) | 50,000 | 50,000 | ||||
Unamortized portion of debt financing costs | 3,764 | 4,065 | ||||
Lease liabilities | 1,188 | 1,239 | ||||
Unamortized portion of mark-to-market adjustments | (12 | ) | (17 | ) | ||
Debt | 675,014 | 688,585 | ||||
(thousands of dollars) | ||||||
Total Assets | 929,771 | 954,887 | ||||
Accumulated depreciation and impairment | 357,465 | 365,970 | ||||
on property, buildings and equipment | ||||||
Accumulated amortization on intangible assets | 5,418 | 5,213 | ||||
Gross Book Value | 1,292,654 | 1,326,070 | ||||
DEBT TO EBITDA
(thousands of dollars) | |||||
Debt | 675,014 | 688,585 | |||
EBITDA (trailing twelve months) | 64,008 | 64,732 | |||
Debt-to-EBITDA (times) | 10.5x | 10.6x |
INTEREST COVERAGE RATIO
(thousands of dollars) | |||||
EBITDA (trailing twelve months) | 64,008 | 64,732 | |||
Interest Expense (trailing twelve months) | 35,774 | 33,725 | |||
Interest Coverage Ratio (times) | 1.8x | 1.9x |
The reconciliation of NOI to hotel EBITDA and EBITDA is shown below:
Three months ended | ||||||
(thousands of dollars) | 2024 | 2023 | ||||
NOI | 17,190 | 18,738 | ||||
Management fees | (1,517 | ) | (2,136 | ) | ||
15,673 | 16,602 | |||||
General administrative expenses | (2,353 | ) | (2,558 | ) | ||
EBITDA | 13,320 | 14,044 |
The reconciliation of NOI to normalized NOI is shown below:
Three months ended | |||||
(thousands of dollars) | 2024 | 2023 | |||
NOI | 17,190 | 18,738 | |||
Business interruption insurance proceeds | 92 | 1,000 | |||
Normalized NOI | 17,282 | 19,738 |
The reconciliation of finance costs to interest expense is shown below:
Three months ended | |||||
(thousands of dollars) | 2024 | 2023 | |||
Finance costs | 11,048 | 8,692 | |||
Loss on debt settlement | (11 | ) | - | ||
Amortization of debt financing costs | (665 | ) | (355 | ) | |
Accretion of Debenture liability | (263 | ) | (242 | ) | |
Amortization of Debenture costs | (113 | ) | (100 | ) | |
Dividends on Series B preferred shares | - | (21 | ) | ||
Interest Expense | 9,996 | 7,974 |
For information on the most directly comparable IFRS measures, composition of the measures, a description of how AHIP uses these measures, and an explanation of how these measures provide useful information to investors, please refer to AHIP’s management discussion and analysis for the three months ended
FORWARD-LOOKING INFORMATION
Certain statements in this news release may constitute “forward-looking information” and “financial outlook” within the meaning of applicable securities laws. Forward-looking information and financial outlook generally can be identified by words such as “anticipate”, “believe”, “continue”, “expect”, “estimates”, “intend”, “may”, “outlook”, “objective”, “plans”, “should”, “will” and similar expressions suggesting future outcomes or events. Forward-looking information and financial outlook include, but are not limited to, statements made or implied relating to the objectives of AHIP, AHIP’s strategies to achieve those objectives and AHIP’s beliefs, plans, estimates, projections and intentions and similar statements concerning anticipated future events, results, circumstances, performance, or expectations that are not historical facts. Forward-looking information and financial outlook in this news release includes, but is not limited to, statements with respect to: AHIP management’s expectation as to the impacts on AHIP’s business of the seasonal nature of the lodging industry, inflation (including on labor and materials costs), competition, overall economic cycles, weather conditions; AHIP’s expectations with respect to the timing and amount of insurance proceeds for weather related damage and lost income in respect of four properties; AHIP’s leverage and liquidity strategies and goals; AHIP’s expectations with respect to the performance of its hotel portfolio, including specific segments thereof; AHIP’s expectations with respect to inflation, labor supply, labor costs, interest rates, consumer spending, new hotel construction and other market financial and macroeconomic conditions in 2024 and beyond and the expected impacts thereof on AHIP’s financial position and performance, including on ADR, occupancy, RevPAR, NOI, NOI margins and cash flows; AHIP’s strategic initiatives and the intended outcomes thereof, including improved liquidity, addressing near-term debt maturities and providing AHIP with financial stability and protecting long-term value for unitholders; AHIP’s expectations with respect to the macroeconomic and operating environment, including certain specific expectations for the 2024 fiscal year; AHIP continuing to execute its strategy to divest assets and reduce debt; AHIP’s planned property dispositions, including the expected terms and timing thereof and the financial impact thereof on AHIP and AHIP’s expectation that the sale of such properties will demonstrate value above the current unit trading price; AHIP’s expectation that it will enter into a cooperation and transfer agreement with the special servicer for the AHIP Northeast Portfolio III CMBS Loan and will transfer the Hotels secured thereby to the special loan servicer in Q2 2024, and the expected impact thereof on AHIP’s financial position;; AHIP’s intended strategies for near-term debt maturities, including planned sales of assets and loan refinancing; the possibility that AHIP may utilize non-recourse foreclosure processes where loan value at maturity is greater than the ability to refinance the loan and market value of the hotel; AHIP’s expectations as to the financial impact of the expired of interest rate swaps for certain term loans, which will be dependent on SOFR; the estimated savings as a result of reductions and deferrals of management fees under the master hotel management agreement as well as increased fees in certain future years when deferred fees become payable; the estimated savings from the temporary suspension of cash distributions and expectation that such amendment to the distribution policy will strengthen AHIP’s balance sheet and liquidity and support long-term enhancement of unitholder value; the statement that the Board and management will continue to review AHIP’s distribution policy on a quarterly basis; and AHIP’s stated long-term objectives.
Although the forward-looking information and financial outlook contained in this news release are based on what AHIP’s management believes to be reasonable assumptions, AHIP cannot assure investors that actual results will be consistent with such information. Forward-looking information is based on a number of key expectations and assumptions made by AHIP, including, without limitation: inflation, labor shortages, and supply chain disruptions will negatively impact the
Forward-looking information and financial outlook involve significant risks and uncertainties and should not be read as guarantees of future performance or results as actual results may differ materially from those expressed or implied in such forward-looking information and financial outlook, accordingly undue reliance should not be placed on such forward-looking information or financial outlook. Those risks and uncertainties include, among other things, risks related to: AHIP may not achieve its expected performance levels in 2024 and beyond; inflation, labor shortages, supply chain disruptions; AHIP’s insurance claims with respect to its weather damaged properties may be denied in whole or in part; AHIP’s brand partners may impose revised service standards and capital requirements which are adverse to AHIP; PIP renovations may not commence or complete in accordance with currently expected timing and may suffer from increased material costs; AHIP’s strategic initiatives with respect to liquidity, addressing near-term debt maturities and providing AHIP with financial stability may not be successful and may not achieve their intended outcomes; AHIP’s strategies for divesting assets to reduce debt may not be successful; AHIP may not complete its currently planned divestures and loan refinancings on the terms currently contemplated or in accordance with the timing currently contemplated, or at all; AHIP’s planned dispositions, once completed, may not demonstrate value above the current unit trading price; savings from the amendments to the master hotel management agreement may be less than expected; AHIP may not be successful in reducing its leverage; there is no guarantee that monthly distributions will be reinstated, and if reinstated, as to the timing thereof or what the amount of the monthly distribution will be; the suspension of monthly distributions is expected to negatively impact the market price of AHIP’s Units and debentures; AHIP may not be able to refinance debt obligations as they become due or may do so on terms less favorable to AHIP than under AHIP’s existing loan agreements; AHIP has not replaced its interest rate swaps, which is expected to create continued increased interest expense; AHIP may not enter into a cooperation and transfer agreement with the special servicer for the AHIP Northeast Portfolio III CMBS Loan on the terms currently contemplated or in accordance with the timing currently contemplated, or at all, and the financial impact of such transactions, if completed, may not be consistent with management’s expectations, and such transactions may not be able to be completed on a non-recourse basis; the actual financial impact on AHIP of entering into an agreement with the special servicer for the Loan Portfolio to transfer control of such portfolio to a receiver, including on AHIP’s financial position, cashflows, NOI and capital expenditure obligations, and anticipated timing of the completion of the underlying transactions may not be consistent with management’s expectations and such transactions may not complete in accordance with the expected timing; general economic conditions and consumer confidence; the growth in the
To the extent any forward-looking information constitutes a “financial outlook” within the meaning of applicable securities laws, such information is being provided to investors to assist in their understanding of: expected proceeds of insurance in respect of AHIP’s weather-damaged properties; estimated potential cash savings from the amendment to the master hotel management agreement and temporary suspension of distributions; the estimated financial impact on AHIP of increased insurance premiums; the estimated financial impact on AHIP of increased interest costs associated with the expiry of interest swaps for certain term loans and the refinancing of certain loans; and management’s expectations for certain aspects of AHIP’s financial performance for the remainder of 2024.
The forward-looking information and financial outlook contained herein is expressly qualified in its entirety by this cautionary statement. Forward-looking information and financial outlook reflect management's current beliefs and are based on information currently available to AHIP. The forward-looking information and financial outlook are made as of the date of this news release and AHIP assumes no obligation to update or revise such information to reflect new events or circumstances, except as may be required by applicable law.
For additional information, please contact:
Investor Relations
ir@ahipreit.com
Source: American Hotel Income Properties
2024 GlobeNewswire, Inc., source