# Chatham Lodging Trust (CLDT)

Informational only - not investment advice.

CIK: 0001476045
SIC: 6798 Real Estate Investment Trusts
SIC breadcrumb: [Finance, Insurance, And Real Estate](/division/H/) > [Holding And Other Investment Offices](/major-group/67/) > [SIC 6798 Real Estate Investment Trusts](/industry/6798/)
Latest 10-K filed: 2026-02-27
SEC page: https://www.sec.gov/edgar/browse/?CIK=1476045
Filing source: https://www.sec.gov/Archives/edgar/data/1476045/000143774926006103/cldt20251231_10k.htm

## Selected Fundamentals
| Metric | Value | Unit | FY | Filed |
| --- | ---: | --- | ---: | --- |
| Revenue | 295075000 | USD | 2025 | 2026-02-27 |
| Net income | 15053000 | USD | 2025 | 2026-02-27 |
| Assets | 1170381000 | USD | 2025 | 2026-02-27 |

## Financials

Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-02-27. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001476045.json. Derived margins, ratios, and free cash flow are computed from the extracted annual SEC facts.

| Metric | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Revenue |  |  |  |  |  |  |  |  |  |  |  |  | 311,109,000 | 317,209,000 | 295,075,000 |
| Net income |  |  |  |  |  | 31,483,000 | 29,478,000 | 30,641,000 | 18,703,000 | -76,023,000 | -18,410,000 | 9,805,000 | 2,644,000 | 4,166,000 | 15,053,000 |
| Operating income |  |  |  |  |  | 58,936,000 | 56,365,000 | 58,134,000 | 53,385,000 | -41,653,000 | -17,214,000 | 36,453,000 | 28,614,000 | 33,220,000 | 40,876,000 |
| Diluted EPS |  |  |  |  |  | 0.81 | 0.73 | 0.66 | 0.39 | -1.62 | -0.46 | 0.04 | -0.11 | -0.08 | 0.14 |
| Operating cash flow |  |  |  |  |  | 87,669,000 | 86,689,000 | 86,215,000 | 86,234,000 | -19,961,000 | 28,777,000 | 71,535,000 | 76,442,000 | 73,825,000 | 64,078,000 |
| Dividends paid |  |  |  |  |  | 52,966,000 | 52,617,000 | 61,590,000 | 62,660,000 | 16,237,000 | 282,000 | 147,000 | 14,212,000 | 14,378,000 | 17,614,000 |
| Share buybacks | 15,000 | 0.00 | 7,000 | 18,000 | 22,000 | 0.00 | 0.00 |  |  |  |  |  | 0.00 | 0.00 | 8,967,000 |
| Assets |  |  |  |  |  | 1,302,954,000 | 1,392,216,000 | 1,439,709,000 | 1,438,574,000 | 1,370,257,000 | 1,410,699,000 | 1,343,738,000 | 1,343,930,000 | 1,254,681,000 | 1,170,381,000 |
| Liabilities |  |  |  |  |  | 621,364,000 | 582,436,000 | 632,291,000 | 663,550,000 | 677,797,000 | 596,506,000 | 525,741,000 | 539,554,000 | 462,684,000 | 392,332,000 |
| Stockholders' equity |  |  |  |  |  | 676,742,000 | 803,162,000 | 797,466,000 | 762,377,000 | 677,752,000 | 797,502,000 | 794,894,000 | 776,061,000 | 758,219,000 | 740,802,000 |
| Cash and cash equivalents |  |  |  |  |  | 12,118,000 | 9,333,000 | 7,192,000 | 6,620,000 | 21,124,000 | 19,188,000 | 26,274,000 | 68,130,000 | 20,195,000 | 24,435,000 |

### Ratios

ROE and ROA use period-end equity/assets. Liabilities / equity uses total liabilities divided by stockholders' equity. Current ratio uses current assets divided by current liabilities when both are reported.

| Metric | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Net margin |  |  |  |  |  |  |  |  |  |  |  |  | 0.85% | 1.31% | 5.10% |
| Operating margin |  |  |  |  |  |  |  |  |  |  |  |  | 9.20% | 10.47% | 13.85% |
| Return on equity |  |  |  |  |  | 4.65% | 3.67% | 3.84% | 2.45% | -11.22% | -2.31% | 1.23% | 0.34% | 0.55% | 2.03% |
| Return on assets |  |  |  |  |  | 2.42% | 2.12% | 2.13% | 1.30% | -5.55% | -1.31% | 0.73% | 0.20% | 0.33% | 1.29% |
| Liabilities / equity |  |  |  |  |  | 0.92 | 0.73 | 0.79 | 0.87 | 1.00 | 0.75 | 0.66 | 0.70 | 0.61 | 0.53 |

## Quarterly

Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-05-07. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001476045.json.

Flow metrics use discrete quarter-length periods from 10-Q/10-Q/A filings. Q4 revenue and net income are derived only when annual FY and nine-month YTD facts exist for the same fiscal year; derived Q4 values are labeled. EPS Q4 is not derived.

| Quarter | End date | Revenue | Net income | Diluted EPS | Method |
| --- | --- | ---: | ---: | ---: | --- |
| 2018-Q2 | 2018-06-30 | 86,590,000 |  |  | reported discrete quarter |
| 2022-Q2 | 2022-06-30 |  |  | 0.15 | reported discrete quarter |
| 2022-Q3 | 2022-09-30 |  |  | 0.21 | reported discrete quarter |
| 2023-Q1 | 2023-03-31 |  |  | -0.14 | reported discrete quarter |
| 2023-Q2 | 2023-06-30 |  | 9,144,000 | 0.15 | reported discrete quarter |
| 2023-Q3 | 2023-09-30 |  | 7,329,000 | 0.11 | reported discrete quarter |
| 2023-Q4 | 2023-12-31 |  | -8,980,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2024-Q1 | 2024-03-31 |  | -5,225,000 | -0.15 | reported discrete quarter |
| 2024-Q2 | 2024-06-30 |  | 6,848,000 | 0.10 | reported discrete quarter |
| 2024-Q3 | 2024-09-30 |  | 4,251,000 | 0.05 | reported discrete quarter |
| 2024-Q4 | 2024-12-31 |  | -1,708,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2025-Q1 | 2025-03-31 | 68,635,000 | 1,536,000 | -0.01 | reported discrete quarter |
| 2025-Q2 | 2025-06-30 | 80,294,000 | 5,376,000 | 0.07 | reported discrete quarter |
| 2025-Q3 | 2025-09-30 | 78,409,000 | 3,531,000 | 0.03 | reported discrete quarter |
| 2025-Q4 | 2025-12-31 | 67,738,000 | 4,612,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2026-Q1 | 2026-03-31 | 67,504,000 | -4,304,000 | -0.13 | reported discrete quarter |

## Macro Cross-References
- [CPIAUCSL](/indicator/CPIAUCSL/): Consumer Price Index for All Urban Consumers: All Items in U.S. City Average
- [UNRATE](/indicator/UNRATE/): Unemployment Rate
- [FEDFUNDS](/indicator/FEDFUNDS/): Federal Funds Effective Rate
- [CES0500000003](/indicator/CES0500000003/): Average Hourly Earnings of All Employees, Total Private
- [DFEDTARU](/indicator/DFEDTARU/): Federal Funds Target Range - Upper Limit
- [DFEDTARL](/indicator/DFEDTARL/): Federal Funds Target Range - Lower Limit
- [DGS3MO](/indicator/DGS3MO/): Market Yield on U.S. Treasury Securities at 3-Month Constant Maturity
- [DGS2](/indicator/DGS2/): Market Yield on U.S. Treasury Securities at 2-Year Constant Maturity
- [DGS10](/indicator/DGS10/): Market Yield on U.S. Treasury Securities at 10-Year Constant Maturity
- [DGS30](/indicator/DGS30/): Market Yield on U.S. Treasury Securities at 30-Year Constant Maturity
- [T10Y2Y](/indicator/T10Y2Y/): 10-Year Treasury Constant Maturity Minus 2-Year Treasury Constant Maturity
- [CPILFESL](/indicator/CPILFESL/): Consumer Price Index for All Urban Consumers: All Items Less Food and Energy
- [CPIUFDSL](/indicator/CPIUFDSL/): Consumer Price Index for All Urban Consumers: Food
- [CPIENGSL](/indicator/CPIENGSL/): Consumer Price Index for All Urban Consumers: Energy
- [CUSR0000SAH1](/indicator/CUSR0000SAH1/): Consumer Price Index for All Urban Consumers: Shelter
- [PCEPI](/indicator/PCEPI/): Personal Consumption Expenditures: Chain-type Price Index
- [PCEPILFE](/indicator/PCEPILFE/): Personal Consumption Expenditures Excluding Food and Energy: Chain-type Price Index
- [PPIACO](/indicator/PPIACO/): Producer Price Index by Commodity: All Commodities
- [T10YIE](/indicator/T10YIE/): 10-Year Breakeven Inflation Rate
- [U6RATE](/indicator/U6RATE/): Total Unemployed, Plus All Marginally Attached Workers Plus Total Employed Part Time for Economic Reasons
- [PAYEMS](/indicator/PAYEMS/): All Employees, Total Nonfarm
- [CIVPART](/indicator/CIVPART/): Labor Force Participation Rate
- [EMRATIO](/indicator/EMRATIO/): Employment-Population Ratio
- [UNEMPLOY](/indicator/UNEMPLOY/): Unemployed
- [CE16OV](/indicator/CE16OV/): Employment Level
- [ICSA](/indicator/ICSA/): Initial Claims
- [JTSJOL](/indicator/JTSJOL/): Job Openings: Total Nonfarm
- [JTSQUR](/indicator/JTSQUR/): Quits: Total Nonfarm
- [GDPC1](/indicator/GDPC1/): Real Gross Domestic Product
- [A191RL1Q225SBEA](/indicator/A191RL1Q225SBEA/): Real Gross Domestic Product: Percent Change from Preceding Period
- [INDPRO](/indicator/INDPRO/): Industrial Production: Total Index
- [TCU](/indicator/TCU/): Capacity Utilization: Total Index
- [HOUST](/indicator/HOUST/): New Privately-Owned Housing Units Started: Total Units
- [PERMIT](/indicator/PERMIT/): New Privately-Owned Housing Units Authorized in Permit-Issuing Places: Total Units
- [RSAFS](/indicator/RSAFS/): Advance Retail Sales: Retail Trade
- [PCE](/indicator/PCE/): Personal Consumption Expenditures
- [DSPIC96](/indicator/DSPIC96/): Real Disposable Personal Income
- [PSAVERT](/indicator/PSAVERT/): Personal Saving Rate
- [M2SL](/indicator/M2SL/): M2
- [BOPGSTB](/indicator/BOPGSTB/): U.S. International Trade in Goods and Services: Balance
- [MSPUS](/indicator/MSPUS/): Median Sales Price of Houses Sold for the United States
- [HSN1F](/indicator/HSN1F/): New One Family Houses Sold: United States
- [RHORUSQ156N](/indicator/RHORUSQ156N/): Homeownership Rate in the United States
- [TTLCONS](/indicator/TTLCONS/): Total Construction Spending: Total Construction in the United States
- [RRVRUSQ156N](/indicator/RRVRUSQ156N/): Rental Vacancy Rate in the United States
- [TOTALSL](/indicator/TOTALSL/): Total Consumer Credit Owned and Securitized
- [REVOLSL](/indicator/REVOLSL/): Revolving Consumer Credit Owned and Securitized
- [DRCCLACBS](/indicator/DRCCLACBS/): Delinquency Rate on Credit Card Loans, All Commercial Banks
- [GDP](/indicator/GDP/): Gross Domestic Product
- [GPDI](/indicator/GPDI/): Gross Private Domestic Investment
- [GCE](/indicator/GCE/): Government Consumption Expenditures and Gross Investment
- [PCEC](/indicator/PCEC/): Personal Consumption Expenditures
- [NETEXP](/indicator/NETEXP/): Net Exports of Goods and Services
- [GFDEBTN](/indicator/GFDEBTN/): Federal Debt: Total Public Debt
- [GFDEGDQ188S](/indicator/GFDEGDQ188S/): Federal Debt: Total Public Debt as Percent of Gross Domestic Product
- [FYFSD](/indicator/FYFSD/): Federal Surplus or Deficit
- [FGRECPT](/indicator/FGRECPT/): Federal Government Current Receipts
- [FGEXPND](/indicator/FGEXPND/): Federal Government: Current Expenditures
- [MANEMP](/indicator/MANEMP/): All Employees, Manufacturing
- [USCONS](/indicator/USCONS/): All Employees, Construction
- [USTRADE](/indicator/USTRADE/): All Employees, Retail Trade
- [USFIRE](/indicator/USFIRE/): All Employees, Financial Activities
- [USGOVT](/indicator/USGOVT/): All Employees, Government
- [AWHAETP](/indicator/AWHAETP/): Average Weekly Hours of All Employees, Total Private
- [DGORDER](/indicator/DGORDER/): Manufacturers' New Orders: Durable Goods
- [NEWORDER](/indicator/NEWORDER/): Manufacturers' New Orders: Nondefense Capital Goods Excluding Aircraft
- [BUSINV](/indicator/BUSINV/): Total Business Inventories
- [EXPGS](/indicator/EXPGS/): Exports of Goods and Services
- [IMPGS](/indicator/IMPGS/): Imports of Goods and Services
- [IR](/indicator/IR/): Import Price Index (End Use): All Commodities
- [PPIFIS](/indicator/PPIFIS/): Producer Price Index by Commodity: Final Demand

## Latest quarter (10-Q)

Latest 10-Q source: https://www.sec.gov/Archives/edgar/data/1476045/000143774926015470/cldt20260203d_10q.htm

Extracted structurally from real Item 2 body heading to real Item 3/4 boundary.
Confidence: high
Filing date: 2026-05-07
Report date: 2026-03-31

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis should be read in conjunction with our consolidated financial statements and related notes included elsewhere in this report and in our Annual Report on Form 10-K for the year ended December 31, 2025. In this report, we use the terms “the Company,” “we” or “our” to refer to Chatham Lodging Trust and its consolidated subsidiaries, unless the context indicates otherwise.

Statement Regarding Forward-Looking Information

The following information contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These forward-looking statements include information about possible or assumed future results of the lodging industry and our business, financial condition, liquidity, results of operations, cash flow and plans and objectives. These statements generally are characterized by the use of the words “believe,” “expect,” “anticipate,” “estimate,” “plan,” “continue,” “intend,” “should,” “may,” “will,” “could” or similar expressions. Although we believe that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, such forward-looking statements relate to future events, our plans, strategies, prospects and future financial performance, and involve known and unknown risks that are difficult to predict, uncertainties and other factors that are, in some cases, beyond our control and which could differ materially from those set forth in the forward-looking statements. Important factors that we think could cause our actual results to differ materially from expected results are summarized below. Some factors that might cause such a difference include the following: local, national and global economic conditions, uncertainty surrounding the financial stability of the United States, Europe and China, increased direct competition, changes in government regulations or accounting rules, changes in local, national and global real estate conditions, declines in lodging industry fundamentals, increased operating costs, a potential recessionary environment, seasonality of the lodging industry, our ability to obtain debt and equity financing on satisfactory terms, changes in interest rates, our ability to identify suitable investments, our ability to close on identified investments, inaccuracies of our accounting estimates, the uncertainty and economic impact of pandemics like COVID-19, epidemics or other public health emergencies or fear of such events, the impact of and changes to various government programs, and our ability to dispose of selected hotel properties on the terms and timing we expect, if at all. Given these uncertainties, undue reliance should not be placed on such statements. We undertake no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect future events or circumstances or to reflect the occurrence of unanticipated events. The forward-looking statements should also be read in light of the risk factors identified in the “Risk Factors” section in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 as updated by the Company's subsequent filings with the SEC under the Exchange Act.

Overview

We are a self-advised hotel investment company organized in October 2009 that commenced operations in April 2010. Our investment strategy is to invest in upscale extended-stay and premium-branded select-service hotels in geographically diverse markets with high barriers to entry near strong demand generators. We may acquire portfolios of hotels or single hotels. We expect that a significant portion of our portfolio will consist of hotels in the upscale extended-stay or select-service categories, including brands such as Homewood Suites by Hilton®, Residence Inn by Marriott®, Hyatt Place®, Courtyard by Marriott®, SpringHill Suites by Marriott®, Hilton Garden Inn by Hilton®, Embassy Suites®, Hampton Inn®, Hampton Inn and Suites®, Home2 Suites by Hilton® and TownePlace Suites by Marriott®.

The Company's future hotel acquisitions may be funded by issuances of both common and preferred shares or the issuance of partnership interests in our operating partnership, Chatham Lodging, L.P. (the "Operating Partnership"), draw-downs under our revolving credit facility, the incurrence or assumption of debt, available cash, or proceeds from dispositions of assets. We intend to acquire quality assets at attractive prices and improve their returns through knowledgeable asset management and seasoned, proven hotel management while remaining prudently leveraged.

At March 31, 2026, our leverage ratio was 24.6% measured as the ratio of our net debt (total debt outstanding before deferred financing costs less unrestricted cash and cash equivalents) to hotel investments at cost. Over the past several years, we have maintained a leverage ratio between the low 20s and the low 50s. As of March 31, 2026, we have total debt of $428.2 million at a weighted-average interest rate of approximately 5.84%.

We are a real estate investment trust (“REIT”) for federal income tax purposes. In order to qualify as a REIT under the Internal Revenue Code of 1986, as amended (the “Code”), we cannot operate our hotels. Therefore, the Operating Partnership and its subsidiaries lease our hotel properties to taxable REIT subsidiary lessees (“TRS Lessees”), who in turn engage eligible independent contractors to manage the hotels. Each of the TRS Lessees is treated as a taxable REIT subsidiary for federal income tax purposes and is consolidated within our financial statements for accounting purposes. However, since we control both the Operating Partnership and the TRS Lessees, our principal source of funds on a consolidated basis is from the operations of our hotels. The earnings of the TRS Lessees are subject to taxation as regular C corporations, as defined in the Code, potentially reducing the TRS Lessees’ cash available to pay dividends to us, and therefore our funds from operations and the cash available for distribution to our shareholders.

Key Indicators of Operating Performance and Financial Condition

We measure financial condition and hotel operating performance by evaluating non-financial and financial metrics and measures such as:

•

Average Daily Rate (“ADR”), which is the quotient of room revenue divided by total rooms sold;

•

Occupancy, which is the quotient of total rooms sold divided by total rooms available;

•

Revenue Per Available Room (“RevPAR”), which is the product of occupancy and ADR, and does not include food and beverage revenue, or other operating revenue;

•

Funds From Operations (“FFO”);

•

Adjusted FFO;

•

Earnings before interest, taxes, depreciation and amortization (“EBITDA”);

•

EBITDAre;

•

Adjusted EBITDA; and

•

Adjusted Hotel EBITDA.

We evaluate the hotels in our portfolio and potential acquisitions using these metrics to determine each hotel’s contribution toward providing income to our shareholders through increases in distributable cash flow and increasing long-term total returns through appreciation in the value of our common shares. RevPAR, ADR and Occupancy are hotel industry measures commonly used to evaluate operating performance.

See “Non-GAAP Financial Measures” for further discussion of FFO, Adjusted FFO, EBITDA, EBITDAre, Adjusted EBITDA and Adjusted Hotel EBITDA.

19

Table of Contents

Results of Operations

Industry Outlook

Smith Travel Research reported that U.S. lodging industry RevPAR increased 3.8% for the three months ended March 31, 2026, with RevPAR up 0.4% in January 2026, up 4.3% in February 2026 and up 5.9% in March 2026. We expect that during the remainder of 2026, lodging industry RevPAR will continue to increase modestly.

Comparison of the three months ended March 31, 2026 to the three months ended March 31, 2025

Results of operations for the three months ended March 31, 2026 include the operating activities of the hotels we owned during the period. We sold one hotel located in Brentwood, TN on January 30, 2025, sold one hotel located in Houston, TX on March 17, 2025, sold one hotel located in Houston, TX on April 22, 2025, and sold one hotel located in Billerica, MA on December 23, 2025. We acquired a portfolio of six hotels on March 3, 2026, which were located in Paducah, KY, Joplin, MO, and Effingham, IL. The changes in results described below were driven primarily by an increase in RevPAR, the sales of four hotels, the acquisition of six hotels and inflationary cost pressures.

Revenues

Revenue, which consists primarily of room, food and beverage and other operating revenues from our hotels, was as follows for the periods indicated (dollars in thousands):

For the three months ended

March 31, 2026

March 31, 2025

% Change

Room

$

61,203

$

62,418

(1.9

)%

Food and beverage

1,602

1,659

(3.4

)%

Other

4,428

4,281

3.4

%

Reimbursable costs from related parties

271

277

(2.2

)%

Total revenue

$

67,504

$

68,635

(1.6

)%

Total revenue was $67.5 million for the three months ended March 31, 2026, down $1.1 million compared to total revenue of $68.6 million for the corresponding 2025 period. The decrease in total revenue primarily was related to the four sold hotels in 2025, which contributed zero revenue during the three months ended March 31, 2026, down $4.1 million from the $4.1 million that the sold hotels contributed for the corresponding 2025 period. The decrease was partially offset by the 1.0% increase in same property RevPAR and the acquisition of six hotels in 2026, which contributed $2.2 million of revenue during the three months ended March 31, 2026, up $2.2 million from the corresponding 2025 period. Since all of our hotels are select-service or limited-service hotels, room revenue is the primary revenue source as these hotels do not have significant food and beverage revenue or large group conference facilities. Room revenue comprised 90.7% and 90.9% of total revenue for the three months ended March 31, 2026 and 2025, respectively.

Food and beverage revenue was $1.6 million for the three months ended March 31, 2026, down $0.1 million compared to $1.7 million for the corresponding 2025 period.

Other operating revenue is comprised of parking, meeting room, gift shop, in-room movie and other ancillary amenities revenue. Other operating revenue was $4.4 million and $4.3 million for the three months ended March 31, 2026 and 2025, respectively.

Reimbursable costs from related parties were $0.3 million and $0.3 million for the three months ended March 31, 2026 and 2025, respectively. The cost reimbursements were offset by the reimbursed costs from related parties included in operating expenses.

In the table below, we present both actual and same property room revenue metrics. Actual Occupancy, ADR and RevPAR metrics reflect the performance of the hotels for the actual days such hotels were owned by the Company during the periods presented. Same property Occupancy, ADR and RevPAR reflect results for the hotels owned by us as of March 31, 2026 that have been in operation for a full year regardless of our ownership during the period presented, which is a non-GAAP financial measure. Results for the hotels for periods prior to our ownership were provided to us by prior owners and have not been adjusted by us.

For the three months ended March 31,

2026

2025

% Change

Same Property

Actual

Same Property

Actual

Same Property

Actual

(39 hotels)

(39 hotels)

(39 hotels)

(37 hotels)

(39 hotels)

(39/37 hotels)

Occupancy

72.5

%

72.8

%

72.4

%

72.1

%

0.1

%

1.0

%

ADR

$

176.87

$

179.23

$

175.47

$

175.06

0.8

%

2.4

%

RevPAR

$

128.23

$

130.50

$

126.98

$

126.24

1.0

%

[Excerpt truncated for page length; source filing is linked above.]

## Latest 10-K MD&A

Extracted structurally from real Item 7 body heading to real Item 7A/8 boundary.
Confidence: high

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations

Overview

Chatham Lodging Trust (“we,” “us” or the “Company”) was formed as a Maryland real estate investment trust on October 26, 2009. The Company is internally managed and was organized to invest primarily in upscale extended-stay and premium-branded select-service hotels. The Company has elected to be taxed as a real estate investment trust for federal income tax purposes ("REIT").

The Company had no operations prior to the consummation of its initial public offering ("IPO") in April 2010. The net proceeds from our share offerings are contributed to Chatham Lodging, L.P., our operating partnership (the “Operating Partnership”), in exchange for partnership interests. Substantially all of the Company’s assets are held by, and all operations are conducted through, the Operating Partnership. The Company is the sole general partner of the Operating Partnership and owns 100% of the common units of limited partnership interest in the Operating Partnership ("common units"). Certain of the Company’s executive officers hold vested and unvested long-term incentive plan units in the Operating Partnership ("LTIP units"), which are presented as non-controlling interests on our consolidated balance sheets.

As of December 31, 2025, the Company owned 33 hotels with an aggregate of 5,021 rooms located in 15 states and the District of Columbia.

To qualify as a REIT, the Company cannot operate its hotels. Therefore, the Operating Partnership and its subsidiaries lease the Company's hotels to taxable REIT subsidiary lessees (“TRS Lessees”), which are wholly owned by the Company’s taxable REIT subsidiary (“TRS”) holding company. Each hotel is leased to a TRS Lessee under a percentage lease that provides for rental payments equal to the greater of (i) a fixed base rent amount or (ii) a percentage rent based on hotel revenue. Lease revenue from each TRS Lessee is eliminated in consolidation.

The TRS Lessees have entered into management agreements with third-party management companies that provide day-to-day management for the hotels. As of December 31, 2025, Island Hospitality Management Inc. (“IHM”), which is 100% owned by Jeffrey H. Fisher, the Company's Chairman, President and Chief Executive Officer, managed all of the Company’s hotels.

Key Indicators of Operating Performance and Financial Condition

We measure financial condition and hotel operating performance by evaluating non-financial and financial metrics and measures such as:

•

Average Daily Rate (“ADR”), which is the quotient of room revenue divided by total rooms sold,

•

Occupancy, which is the quotient of total rooms sold divided by total rooms available,

•

Revenue Per Available Room (“RevPAR”), which is the product of occupancy and ADR, and does not include food and beverage revenue, or other operating revenue,

•

Funds From Operations (“FFO”),

•

Adjusted FFO,

•

Earnings before interest, taxes, depreciation and amortization (“EBITDA”),

•

EBITDAre,

•

Adjusted EBITDA, and

•

Adjusted Hotel EBITDA.

We evaluate the hotels in our portfolio and potential acquisitions using these metrics to determine each hotel’s contribution toward providing income to our shareholders through increases in distributable cash flow and increasing long-term total returns through appreciation in the value of our common shares. RevPAR, ADR and Occupancy are hotel industry measures commonly used to evaluate operating performance.

See “Non-GAAP Financial Measures” for further discussion of FFO, Adjusted FFO, EBITDA, EBITDAre, Adjusted EBITDA and Adjusted Hotel EBITDA.

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Results of Operations

Comparison of the year ended December 31, 2025 to the year ended December 31, 2024

The section below provides a comparative discussion of our consolidated results of operations between fiscal year 2025 and 2024. See Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 for comparative a discussion of our consolidated results of operations between fiscal 2024 and fiscal 2023.

Results of operations for the year ended December 31, 2025 include the operating activities of the hotels we owned during the period. We sold one hotel located in Denver, CO on January 9, 2024, one hotel located in Maitland, FL on December 6, 2024, one hotel located in Bloomington, MN on December 16, 2024, one hotel located in Brentwood, TN on January 30, 2025, one hotel located in Houston, TX on March 17, 2025, one hotel located in Houston, TX on April 22, 2025, and one hotel located in Billerica, MA on December 23, 2025. We acquired one hotel located in Phoenix, AZ on May 30, 2024. The changes in results described below were driven primarily by the sales of seven hotels, the acquisition of one hotel and inflationary cost pressures.

Revenue

Revenue, which consists primarily of room, food and beverage and other operating revenues from our hotels, was as follows for the periods indicated (dollars in thousands):

For the year ended

December 31, 2025

December 31, 2024

% Change

Room

$

269,206

$

290,290

(7.3

)%

Food and beverage

6,894

7,737

(10.9

)%

Other

17,897

18,077

(1.0

)%

Cost reimbursements from related parties

1,078

1,105

(2.4

)%

Total revenue

$

295,075

$

317,209

(7.0

)%

Total revenue decreased $22.1 million to $295.1 million for the year ended December 31, 2025 compared to total revenue of $317.2 million for the 2024 period. The decrease in total revenue primarily was related to the decrease in revenue from the sales of seven hotels that contributed $8.9 million in revenue for the year ended December 31, 2025, down $24.6 million from the $33.5 million that the sold hotels contributed for the corresponding 2024 period. Same property RevPAR also decreased by 0.1%. This was partially offset by the increase in revenue from the acquisition of one hotel that contributed $8.6 million of revenue during the year ended December 31, 2025, up $4.9 million from the $3.7 million that the acquired hotel contributed for the corresponding 2024 period. Since all of our hotels are select-service or limited-service hotels, room revenue is the primary revenue source as these hotels do not have significant food and beverage revenue or large group conference facilities. Room revenue comprised 91.2% and 91.5% of total revenue for the years ended December 31, 2025 and 2024, respectively. Room revenue was $269.2 million and $290.3 million for the years ended December 31, 2025 and 2024, respectively, and the decrease in room revenue primarily was related to the same factors discussed above.

Food and beverage revenue was $6.9 million and $7.7 million for the years ended December 31, 2025 and 2024, respectively.

Other revenue, comprised of parking, meeting room, gift shop, in-room movie and other ancillary amenities revenue, decreased $0.2 million for the year ended December 31, 2025.

Reimbursed costs from related parties were $1.1 million and $1.1 million for the years ended December 31, 2025 and 2024, respectively. The cost reimbursements were offset by the reimbursed costs from related parties included in operating expenses.

As reported by Smith Travel Research, U.S. lodging industry RevPAR for the years ended December 31, 2025 and 2024 decreased 0.3% and increased 1.8%, respectively, as compared to the years ended December 31, 2024 and 2023. Smith Travel Research reported that U.S. lodging industry RevPAR increased 2.2% in the first quarter of 2025, decreased 0.5% in the second quarter of 2025, decreased 1.4% in the third quarter of 2025 and decreased 1.1% in the fourth quarter of 2025. Smith Travel Research currently projects industry RevPAR growth of 0.6% in 2026.

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Table of Contents

In the table below, we present both actual and same property room revenue metrics. Actual Occupancy, ADR and RevPAR metrics reflect the performance of the hotels for the actual days such hotels were owned by the Company during the periods presented. Same property Occupancy, ADR, and RevPAR reflect results for the hotels owned by the Company as of December 31, 2025 that have been in operation for a full year regardless of our ownership during the period presented, which is a non-GAAP financial measure. Results for the hotels for the periods prior to our ownership were provided to us by prior owners and have not been adjusted by us.

For the year ended

December 31, 2025

December 31, 2024

% Change

Same Property

Actual

Same Property

Actual

Same Property

Actual

(33 hotels)

(37 hotels)

(33 hotels)

(40 hotels)

(33 hotels)

(37/40 hotels)

Occupancy

76.6

%

76.3

%

76.2

%

76.3

%

0.5

%

0.0

%

ADR

$

185.78

$

183.95

$

187.03

$

178.96

(0.7

)%

2.8

%

RevPAR

$

142.39

$

140.38

$

142.56

$

136.49

(0.1

)%

2.9

%

For the year ended December 31, 2025, same property RevPAR decreased 0.1% due to an increase in occupancy of 0.5% and a decrease in ADR of 0.7%.

Hotel Operating Expenses

Hotel operating expenses consisted of the following for the periods indicated (dollars in thousands):

For the year ended

December 31, 2025

December 31, 2024

% Change

Hotel operating expenses:

Room

$

59,752

$

65,311

(8.5

)%

Food and beverage expense

5,517

6,218

(11.3

)%

Telephone expense

1,172

1,360

(13.8

)%

Other expense

4,487

4,127

8.7

%

General and administrative

27,010

28,826

(6.3

)%

Franchise and marketing fees

23,620

25,355

(6.8

)%

Advertising and promotions

6,804

6,229

9.2

%

Utilities

12,372

13,161

(6.0

)%

Repairs and maintenance

15,272

16,516

(7.5

)%

Management fees paid to related parties

9,895

10,733

(7.8

)%

Insurance

3,272

3,340

(2.0

)%

Total hotel operating expenses

$

169,173

$

181,176

(6.6

)%

Hotel operating expenses decreased $12.0 million, or 6.6%, to $169.2 million for the year ended December 31, 2025 from $181.2 million for the year ended December 31, 2024. The seven sold hotels contributed $6.0 million in operating expenses for the year ended December 31, 2025, down $15.9 million from the $21.9 million that the sold hotels contributed for the corresponding 2024 period. This was partially offset by the increase in operating expenses from the acquisition of one hotel that contributed $4.5 million in operating expenses for the year ended December 31, 2025, up $2.3 million from the $2.2 million that the acquired hotel contributed for the corresponding 2024 period. The remaining change in operating expenses was related to inflationary cost pressures.

Room expenses, which are the most significant component of hotel operating expenses, decreased $5.5 million from $65.3 million in 2024 to $59.8 million in 2025. The decrease in room expenses was related primarily to the decrease in costs from the sales of seven hotels, partially offset by the increase in costs from the acquisition of one hotel and an increase in costs related to an increase in same property occupancies at our hotels.

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Table of Contents

The remaining hotel operating expenses decreased $6.5 million, or 5.6%, from $115.9 million in 2024 to $109.4 million in 2025. The decrease in the remaining operating expenses was related primarily to the decrease in costs from the sales of seven hotels, partially offset by the increase in costs from the acquisition of one hotel and an increase in costs related to inflationary cost pressures.

Depreciation and Amortization

Depreciation and amortization expense decreased $1.0 million from $60.7 million for the year ended December 31, 2024 to $59.7 million for the year ended December 31, 2025. Depreciation is generally recorded on our assets over 40 years for buildings, 20 years for land improvements, 15 years for building improvements and one to ten years for hotel furniture, fixtures and equipment from the date of acquisition on a straight-line basis. Depreciable lives of hotel furniture, fixtures and equipment are generally assumed to be the difference between the date of acquisition and the date that the furniture, fixtures and equipment will be replaced. Amortization of franchise fees is recorded on a straight-line basis over the term of the respective franchise agreement.

Impairment Loss

Impairment loss was zero and $4.3 million for the years ended December 31, 2025 and 2024, respectively. The impairment loss in 2024 was due to the impairment recorded on the CY Houston hotel property which was sold on April 22, 2025.

Property Taxes, Ground Rent and Insurance

Total property taxes, ground rent and insurance expenses decreased $1.7 million from $23.7 million for the year ended December 31, 2024 to $22.0 million for the year ended December 31, 2025. The decrease was primarily related to the sales of seven hotels partially offset by increases in property tax assessments.

General and Administrative

General and administrative expenses principally consist of employee-related costs, including base payroll, bonuses and amortization of restricted stock and awards of LTIP units. These expenses also include corporate operating costs, professional fees and trustees’ fees. Total general and administrative expenses (excluding amortization of stock based compensation of $6.3 million and $6.4 million for the years ended December 31, 2025 and 2024, respectively) decreased $1.7 million to $10.3 million in 2025 from $12.0 million in 2024.

Other Charges

Other charges decreased from $0.3 million for the year ended December 31, 2024 to $27 thousand for the year ended December 31, 2025.

Reimbursable Costs from Related Parties

Reimbursable costs from related parties, comprised of shared office expenses and rent, were $1.1 million and $1.1 million for the years ended December 31, 2025 and 2024, respectively. The cost reimbursements were offset by the cost reimbursements from related parties included in revenues.

Gain on Sale of Hotel Properties

Gain on the sale of hotel properties increased $8.7 million to $14.4 million for the year ended December 31, 2025 compared to $5.7 million for the year ended December 31, 2024. The HWS Brentwood hotel property was sold on January 30, 2025, the HI Houston hotel property was sold on March 17, 2025, the CY Houston hotel property was sold on April 22, 2025, and the HWS Billerica hotel property was sold on December 23, 2025, which resulted in a total gain of $14.4 million. The HGI Denver Tech hotel property was sold on January 9, 2024, the HWS Maitland hotel property was sold on December 6, 2024, and the HWS Bloomington hotel property was sold on December 16, 2024, which resulted in a total gain of $5.7 million.

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Table of Contents

Interest and Other Income

Interest on cash and cash equivalents and other income decreased $1.4 million from $1.7 million for the year ended December 31, 2024 to $0.3 million for the year ended December 31, 2025. The decrease was due to lower cash balances during the year ended December 31, 2025.

Interest Expense, Including Amortization of Deferred Fees

Interest expense decreased $5.2 million, or 16.9%, from $30.9 million for the year ended December 31, 2024 to $25.7 million for the year ended December 31, 2025. Interest expense is comprised of the following (dollars in thousands):

For the year ended

December 31, 2025

December 31, 2024

% Change

Mortgage debt interest

$

10,515

$

16,085

(34.6

)%

Credit facility and term loan interest and unused fees

13,641

13,372

2.0

%

Interest on finance lease liability

25

14

78.6

%

Amortization of deferred financing costs

1,478

1,409

4.9

%

Total

$

25,659

$

30,880

(16.9

)%

The decrease in interest expense was due to lower debt balances and lower floating rate borrowing costs during the year ended December 31, 2025 than during the year ended December 31, 2024.

Loss on Early Extinguishment of Debt

Loss on early extinguishment of debt increased $0.2 million from $17 thousand for the year ended December 31, 2024 to $0.2 million for the year ended December 31, 2025. The loss in 2025 was related to the Company entering into a new unsecured revolving credit facility and the write-off of unamortized deferred financing fees from the prior facility.

Income Tax Expense

Income tax expense remained unchanged at zero for the years ended December 31, 2025 and 2024. We are subject to income taxes based on the taxable income of our TRS Lessees at a combined federal and state tax rate of approximately 25%. The Company's TRS is expecting the taxable income in 2025 to be offset by prior year net operating losses and recognizes a full valuation allowance equal to 100% of the net deferred tax assets due to the uncertainty of the TRS's ability to utilize these net deferred tax assets.

Net Income

Net income was $15.3 million for the year ended December 31, 2025, compared to net income of $4.0 million for the year ended December 31, 2024. The change in net income primarily was due to the factors discussed above.

Material Trends or Uncertainties

We are not aware of any material trends or uncertainties, favorable or unfavorable, that may be reasonably anticipated to have a material impact on either the capital resources or the revenues or income to be derived from the acquisition and operation of properties, loans and other permitted investments, other than those referred to in this section and the risk factors identified in the “Risk Factors” section of this Annual Report on this Form 10-K.

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Table of Contents

Non-GAAP Financial Measures

We consider the following non-GAAP financial measures useful to investors as key supplemental measures of our operating performance: (1) FFO, (2) Adjusted FFO, (3) EBITDA, (4) EBITDAre, (5) Adjusted EBITDA and (6) Adjusted Hotel EBITDA. These non-GAAP financial measures should be considered along with, but not as alternatives to, net income or loss as prescribed by GAAP as a measure of our operating performance.

FFO, Adjusted FFO, EBITDA, EBITDAre, Adjusted EBITDA and Adjusted Hotel EBITDA do not represent cash generated from operating activities under GAAP and should not be considered as alternatives to net income or loss, cash flows from operations or any other operating performance measure prescribed by GAAP. FFO, Adjusted FFO, EBITDA, EBITDAre, Adjusted EBITDA and Adjusted Hotel EBITDA are not measures of our liquidity, nor are FFO, Adjusted FFO, EBITDA, EBITDAre, Adjusted EBITDA or Adjusted Hotel EBITDA indicative of funds available to fund our cash needs, including our ability to make cash distributions. These measurements do not reflect cash expenditures for long-term assets and other items that have been and will be incurred. FFO, Adjusted FFO, EBITDA, EBITDAre, Adjusted EBITDA and Adjusted Hotel EBITDA may include funds that may not be available for management’s discretionary use due to functional requirements to conserve funds for capital expenditures, property acquisitions, and other commitments and uncertainties.

We calculate FFO in accordance with standards established by Nareit, which defines FFO as net income or loss (calculated in accordance with GAAP), excluding gains or losses from sales of real estate, impairment write-downs, the cumulative effect of changes in accounting principles, plus depreciation and amortization (excluding amortization of deferred financing costs), and after adjustments for unconsolidated partnerships and joint ventures following the same approach. We believe that the presentation of FFO provides useful information to investors regarding our operating performance because it measures our performance without regard to specified non-cash items such as real estate depreciation and amortization, gain or loss on sale of real estate assets and certain other items that we believe are not indicative of the property level performance of our hotel properties. We believe that these items reflect historical cost of our asset base and our acquisition and disposition activities and are less reflective of our ongoing operations, and that by adjusting to exclude the effects of the items, FFO is useful to investors in comparing our operating performance between periods and between REITs that report FFO using the Nareit definition.

We calculate Adjusted FFO by further adjusting FFO for certain additional items that are not addressed in Nareit’s definition of FFO, including other charges, losses on the early extinguishment of debt and similar items related to our unconsolidated real estate entities that we believe do not represent costs related to hotel operations. We believe that Adjusted FFO provides investors with another financial measure that may facilitate comparisons of operating performance between periods and between REITs that make similar adjustments to FFO.

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Table of Contents

The following is a reconciliation of net income (loss) to FFO and Adjusted FFO for the years ended December 31, 2025, 2024 and 2023 (in thousands, except share data):

For the year ended

December 31,

2025

2024

2023

Funds From Operations (“FFO”):

Net income

$

15,313

$

4,035

$

2,488

Preferred dividends

(7,950

)

(7,950

)

(7,950

)

Net income (loss) attributable to common shares and common units

7,363

(3,915

)

(5,462

)

Gain on sale of hotel properties

(14,369

)

(5,713

)

(18

)

Depreciation of hotel properties owned

57,664

59,513

58,040

Impairment loss

—

4,256

4,266

FFO attributed to common share and unit holders

50,658

54,141

56,826

Amortization of finance lease assets

1,887

1,010

—

Other charges

27

327

2,300

Loss on early extinguishment of debt

174

17

696

Gain from partial lease termination

—

—

(164

)

Adjusted FFO attributed to common share and unit holders

$

52,746

$

55,495

$

59,658

Weighted average number of common shares and units

Basic

50,522,421

50,757,548

50,374,481

Diluted

51,721,473

51,172,183

50,532,122

Diluted weighted average common share count used for calculation of adjusted FFO per share may differ from diluted weighted average common share count used for calculation of GAAP Net Income per share by LTIP units, which may be converted to common shares of beneficial interest, and if Net Income per share is negative and Adjusted FFO is positive. Unvested restricted shares and unvested LTIP units that could potentially dilute basic earnings per share in the future would not be included in the computation of diluted loss per share for the periods where a loss has been recorded because they would have been anti-dilutive for the periods presented.

EBITDA is defined as net income or loss excluding: (1) interest expense; (2) provision for income taxes, including income taxes applicable to sale of assets; (3) depreciation and amortization; and (4) unconsolidated real estate entity items including interest, depreciation and amortization excluding gains and losses from sales of real estate. We consider EBITDA useful to an investor in evaluating and facilitating comparisons of our operating performance between periods and between REITs by removing the impact of our capital structure (primarily interest expense) and asset base (primarily depreciation and amortization) from our operating results. In addition, EBITDA is used as one measure in determining the value of hotel acquisitions and dispositions.

In addition to EBITDA, we present EBITDAre in accordance with Nareit guidelines, which defines EBITDAre as net income or loss excluding interest expense, income tax expense, depreciation and amortization expense, gains or losses from sales of real estate, impairment, and adjustments for unconsolidated joint ventures. We believe that the presentation of EBITDAre provides useful information to investors regarding the Company's operating performance and can facilitate comparison of operating performance between periods and between REITs.

We also present Adjusted EBITDA which includes additional adjustments for items such as other charges, gains or losses on extinguishment of indebtedness, amortization of share-based compensation and certain other expenses that we consider outside the normal course of operations. We believe that Adjusted EBITDA provides useful supplemental information to investors regarding our ongoing operating performance that, when considered with net income, EBITDA and EBITDAre, is beneficial to an investor's understanding of our performance.

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Table of Contents

The following is a reconciliation of net income (loss) to EBITDA, EBITDAre and Adjusted EBITDA for the years ended December 31, 2025, 2024 and 2023 (in thousands):

For the year ended

December 31,

2025

2024

2023

Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”):

Net income

$

15,313

$

4,035

$

2,488

Interest expense, including amortization of deferred fees

25,659

30,880

27,128

Depreciation and amortization

59,749

60,741

58,254

EBITDA

100,721

95,656

87,870

Impairment loss

—

4,256

4,266

Gain on sale of hotel properties

(14,369

)

(5,713

)

(18

)

EBITDAre

86,352

94,199

92,118

Other charges

27

327

2,300

Loss on early extinguishment of debt

174

17

696

Gain from partial lease termination

—

—

(164

)

Share based compensation

6,256

6,398

6,117

Adjusted EBITDA

$

92,809

$

100,941

$

101,067

Adjusted Hotel EBITDA is defined as net income before interest, income taxes, depreciation and amortization, corporate general and administrative, impairment loss, loss on early extinguishment of debt, other charges, interest and other income, losses on sales of hotel properties and income or loss from unconsolidated real estate entities. We present Adjusted Hotel EBITDA because we believe it is useful to investors in comparing our hotel operating performance between periods and comparing our Adjusted Hotel EBITDA margins to those of our peer companies. Adjusted Hotel EBITDA represents the results of operations for our wholly owned hotels only.

The following is a presentation of Adjusted Hotel EBITDA for the years ended December 31, 2025, 2024 and 2023 (in thousands):

For the year ended

December 31,

2025

2024

2023

Net income

$

15,313

$

4,035

$

2,488

Add: Interest expense, including amortization of deferred fees

25,659

30,880

27,128

Depreciation and amortization

59,749

60,741

58,254

Corporate general and administrative

16,589

18,388

17,517

Other charges

27

327

2,300

Impairment loss

—

4,256

4,266

Loss on early extinguishment of debt

174

17

696

Less: Interest and other income

(270

)

(1,712

)

(1,534

)

Gain on sale of hotel properties

(14,369

)

(5,713

)

(18

)

Gain from partial lease termination

—

—

(164

)

Adjusted Hotel EBITDA

$

102,872

$

111,219

$

110,933

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Table of Contents

Although we present FFO, Adjusted FFO, EBITDA, EBITDAre, Adjusted EBITDA and Adjusted Hotel EBITDA because we believe they are useful to investors in comparing our operating performance between periods and between REITs that report similar measures, these measures have limitations as analytical tools. Some of these limitations are:

•

FFO, Adjusted FFO, EBITDA, EBITDAre, Adjusted EBITDA and Adjusted Hotel EBITDA do not reflect our cash expenditures or future requirements for capital expenditures or contractual commitments;

•

FFO, Adjusted FFO, EBITDA, EBITDAre, Adjusted EBITDA and Adjusted Hotel EBITDA do not reflect changes in, or cash requirements for, our working capital needs;

•

FFO, Adjusted FFO, EBITDA, EBITDAre, Adjusted EBITDA and Adjusted Hotel EBITDA do not reflect funds available to make cash distributions;

•

EBITDA, EBITDAre, Adjusted EBITDA and Adjusted Hotel EBITDA do not reflect the significant interest expense, or the cash requirements necessary to service interest or principal payments, on our debts;

•

Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized may need to be replaced in the future, and FFO, Adjusted FFO, EBITDA, EBITDAre, Adjusted EBITDA and Adjusted Hotel EBITDA do not reflect any cash requirements for such replacements;

•

Non-cash compensation is and will remain a key element of our overall long-term incentive compensation package, although we exclude it as an expense when evaluating our ongoing operating performance for a particular period using Adjusted EBITDA;

•

Adjusted FFO, Adjusted EBITDA and Adjusted Hotel EBITDA do not reflect the impact of certain cash charges (including acquisition transaction costs) that result from matters we consider not to be indicative of the underlying performance of our hotel properties;

•

Other companies in our industry may calculate FFO, Adjusted FFO, EBITDA, EBITDAre, Adjusted EBITDA and Adjusted Hotel EBITDA differently than we do, limiting their usefulness as a comparative measure; and

•

FFO, Adjusted FFO, EBITDA, EBITDAre, Adjusted EBITDA and Adjusted Hotel EBITDA do not represent cash generated from operating activities as determined by GAAP and should not be considered as alternatives to net income or loss, cash flows from operations or any other operating performance measure prescribed by GAAP. FFO, Adjusted FFO, EBITDA, EBITDAre, Adjusted EBITDA and Adjusted Hotel EBITDA are not measures of our liquidity.

Because of these limitations, FFO, Adjusted FFO, EBITDA, Adjusted EBITDA and Adjusted Hotel EBITDA should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP. We compensate for these limitations by relying primarily on our GAAP results and using FFO, Adjusted FFO, EBITDA, EBITDAre, Adjusted EBITDA and Adjusted Hotel EBITDA only supplementally. Our consolidated financial statements and the notes to those statements included elsewhere are prepared in accordance with GAAP.

Liquidity and Capital Resources

We plan to maintain a prudent capital structure and intend to maintain our leverage over the long term at a ratio of net debt to investment in hotels (at cost) (defined as our initial acquisition price plus the gross amount of any subsequent capital investment) at a level that will be similar to the levels at which we have operated in the past. A subsequent decrease in hotel property values will not necessarily cause us to repay debt to comply with this limitation. At December 31, 2025, our leverage ratio was approximately 20.1%, which decreased from 23.1% at December 31, 2024 based on the ratio of our net debt (total debt outstanding before deferred financing costs less unrestricted cash and cash equivalents) to hotel investments at cost. At December 31, 2025, we had total debt of $343.2 million at an average rate of approximately 6.2%. We intend to continue to fund our investments with a prudent balance of debt and equity. Our debt may include mortgage debt collateralized by our hotel properties and unsecured debt.

At December 31, 2025 and 2024, we had $0 and $110.0 million, respectively, in outstanding borrowings under our revolving credit facility. We had $200.0 million and $140.0 million in outstanding borrowings under our unsecured term loan at December 31, 2025 and 2024, respectively. At December 31, 2025, the maximum remaining borrowing availability under our revolving credit facility was $300.0 million. We also had mortgage debt on individual hotels aggregating $143.2 million and $159.2 million at December 31, 2025 and 2024, respectively.

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Table of Contents

On September 25, 2025, the Company entered into a new credit agreement for a credit facility (the "Credit Facility") consisting of a $300.0 million unsecured revolving credit facility and a $200.0 million unsecured term loan facility which replaced the existing $260.0 million revolving credit facility and the existing $140.0 million unsecured term loan facility. Proceeds from the new $200.0 million funded term loan were used to repay the $60.0 million of outstanding borrowings under the prior $260.0 million revolving credit facility and the $140.0 million of outstanding borrowings under the prior term loan. The new Credit Facility has an initial maturity date of September 25, 2029 and provides options to extend for one year. Total commitments of $500.0 million under the new Credit Facility can be increased up to $650.0 million through an accordion feature. Pricing on the new facilities is based on SOFR plus a spread of 1.50% to 2.25% for the revolving credit facility and a spread of 1.45% to 2.20% for the unsecured term loan facility based on the Company's leverage. 

Our revolving credit facility and term loan contain representations, warranties, covenants, terms and conditions customary for credit facilities of this type, including a maximum leverage ratio, a maximum secured leverage ratio, a maximum unsecured leverage ratio, a minimum fixed charge coverage ratio, a minimum unsecured interest coverage ratio, and minimum net worth financial covenants, limitations on (i) liens, (ii) incurrence of debt, (iii) investments, (iv) distributions, and (v) mergers and asset dispositions, covenants to preserve corporate existence and comply with laws, covenants on the use of proceeds of the revolving credit facility and default provisions, including defaults for non-payment, breach of representations and warranties, insolvency, non-performance of covenants, cross-defaults and guarantor defaults. We were in compliance with all financial covenants at December 31, 2025.

In December 2017, we established a $50 million dividend reinvestment and stock purchase plan (the "DRSPP") which we renewed in December 2020 and renewed again in January 2024. Under the DRSPP, shareholders may purchase additional common shares by reinvesting some or all of the cash dividends received on common shares. Shareholders may also make optional cash purchases of the Company's common shares subject to certain limitations detailed in the prospectus for the DRSPP. During the year ended December 31, 2025, the Company issued 7,630 common shares under the DRSPP at a weighted average price of $7.10, which generated $54 thousand of proceeds. As of December 31, 2025, there was approximately $49.9 million of common shares available for issuance under the DRSPP.

In January 2021, we established an "at-the-market" equity offering program (the "ATM Program") whereby, from time to time, we may publicly offer and sell our common shares having an aggregate offering price of up to $100 million by means of ordinary brokers transactions on the New York Stock Exchange (the "NYSE"), in negotiated transactions or in transactions deemed to be "at-the-market" offerings as defined in Rule 415 under the Securities Act of 1933, as amended. The Company did not issue any common shares under the ATM Program during the year ended December 31, 2025. As of December 31, 2025, there was approximately $77.5 million of common shares available for issuance under the ATM Program.

In May 2025, the Board of Trustees authorized and approved a $25.0 million share repurchase program (the "Share Repurchase Program") of our common shares. Under the Share Repurchase Program, we have the ability to repurchase up to $25.0 million of common shares through open market purchases or other privately negotiated transactions at times and in amounts as we deem appropriate. The Share Repurchase Program has no time limit and may be suspended or discontinued at any time. During the year ended December 31, 2025, the Company repurchased 1,313,795 common shares at a weighted-average price per share of $6.83 for an aggregate purchase price, including commissions, of approximately $9.0 million. As of December 31, 2025, there was approximately $16.0 million of common shares available for repurchase under the Share Repurchase Program.

We expect to meet our short-term liquidity requirements generally through existing cash balances and availability under our revolving credit facility and unsecured term loan. We believe that our existing cash balances and availability under our revolving credit facility and unsecured term loan will be adequate to fund operating obligations, pay interest on any borrowings and fund dividends in accordance with the requirements for qualification as a REIT under the Code. We expect to meet our long-term liquidity requirements, such as hotel property acquisitions and debt maturities or repayments through borrowings under our revolving credit facility and unsecured term loan, additional long-term secured and unsecured borrowings, the issuance of additional equity or debt securities or the possible sale of existing assets.

We intend to continue to invest in hotel properties as suitable opportunities arise. We intend to finance our future investments with free cash flow, the net proceeds from additional issuances of common and preferred shares, issuances of common units in our Operating Partnership or other securities, borrowings or asset sales. The success of our acquisition strategy depends, in part, on our ability to access additional capital through other sources. There can be no assurance that we will continue to make investments in properties that meet our investment criteria. Additionally, we may choose to dispose of certain hotels as a means to provide liquidity.

We had no material off-balance sheet arrangements at December 31, 2025.

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Sources and Uses of Cash

Our principal sources of cash include net cash from operations, availability under our revolving credit facility, proceeds from debt and equity issuances, and proceeds from the sale of hotel properties. Our principal uses of cash include acquisitions, capital expenditures, operating costs, corporate expenditures, interest costs, debt repayments and distributions to equity holders.

Cash, cash equivalents, and restricted cash totaled $32.6 million as of December 31, 2025, an increase of $2.8 million from December 31, 2024, primarily due to net cash provided by operating activities of $64.1 million, net cash provided by investing activities of $45.4 million, and net cash used in financing activities $106.7 million.

Cash from Operations

Net cash flows provided by operating activities decreased $9.7 million to $64.1 million in 2025 compared to $73.8 million in 2024. The decrease in cash from operating activities was primarily due to the sale of seven hotels in 2024 and 2025.

Investing Activities Cash Flows

Net cash flows provided by (used in) investing activities increased $74.6 million to $45.4 million in 2025 compared to $(29.2) million in 2024. For the year ended December 31, 2025, net cash flows provided by investing activities of $45.4 million consisted of $24.5 million related to capital improvements on our hotels and $0.1 million of payments of franchise application costs, partially offset by $70.0 million in net proceeds related to the sale of four hotels. For the year ended December 31, 2024, net cash flows used in investing activities of $(29.2) million consisted of $30.6 million related to capital improvements on our hotels, $43.7 million related to the acquisition of one hotel, and $0.7 million of payments of franchise application costs, partially offset by $45.9 million in net proceeds related to the sale of three hotels.

We expect to invest approximately $26.5 million on renovations, discretionary and emergency expenditures on our existing hotels in 2026, including improvements required under any brand property improvement plan ("PIP").

Financing Activities Cash Flows

Net cash flows used in financing activities increased $6.1 million to $(106.7) million in 2025 compared to $(100.6) million in 2024. For the year ended December 31, 2025, net cash flows used in financing activities of $106.7 million were comprised of net repayments on our revolving credit facility of $110.0 million, the repayment of mortgage debt of $16.0 million, payments of financing costs of $6.2 million, repurchases of common shares of $9.0 million, distributions to common share and LTIP unit holders of $17.6 million, and distributions on preferred shares of $8.0 million, partially offset by net borrowings on our unsecured term loan of $60.0 million. For the year ended December 31, 2024, net cash flows used in financing activities of $(100.6) million were comprised of the repayment of mortgage debt of $297.2 million, distributions to common share and unit holders of $14.4 million, distributions on preferred shares of $8.0 million, payments of financing costs of $1.1 million, and payments of offering costs on common shares of $0.3 million, partially offset by net borrowings on our revolving credit facility of $110.0 million, borrowings on our unsecured term loan of $50.0 million, and proceeds from the issuance of mortgage debt of $60.3 million.

We declared total dividends of $0.36 per common share and LTIP unit for the year ended December 31, 2025, and $0.28 per common share and LTIP unit for the year ended December 31, 2024. We declared total dividends of $1.65624 and $1.65624 per Series A preferred share for the years ended December 31, 2025 and 2024, respectively.

Material Cash Requirements

Our material cash requirements include the following contractual obligations:

•

At December 31, 2025, we had total debt principal and interest obligations of $449.5 million with $21.3 million of principal and interest payable within the next 12 months from December 31, 2025.The Company has no debt principal obligations payable during the next 12 months. See Note 6, “Debt” to our consolidated financial statements for additional information relating to our property loans, revolving credit facility and unsecured term loan.

•

Lease payments due within the next 12 months from year-end 2025 total $1.8 million. See Note 12, “Leases” to our consolidated financial statements for additional information relating to our corporate office and ground leases.

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Related Party Transactions

We have entered into transactions and arrangements with related parties that could result in potential conflicts of interest. See “Risks Related to Our Business” and Note 14, “Related Party Transactions”, to our consolidated financial statements included in this Annual Report on Form 10-K. See also Item 13 of this Form 10-K.

Inflation

Operators of hotels, in general, possess the ability to adjust room rates daily to reflect the effects of inflation. However, competitive pressures may limit the ability of our management companies to raise room rates.

Critical Accounting Estimates

We consider the following estimates critical because they require estimates about matters that are inherently uncertain, involve various assumptions and require management judgment. The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities at the balance sheet date and the reported amounts of revenues and expenses during the reporting period. Actual results may differ from these estimates and assumptions.

Investment in Hotel Properties

We allocate the purchase prices of hotel properties acquired as asset acquisitions based on the fair value of the acquired real estate, furniture, fixtures and equipment, identifiable intangible assets and assumed liabilities. In making estimates of fair value for purposes of allocating the purchase price, we utilize a number of sources of information that are obtained in connection with the acquisition of a hotel property, including valuations performed by independent third parties and information obtained about each hotel property resulting from pre-acquisition due diligence.

Our hotel properties are carried at cost and are depreciated using the straight-line method over the estimated useful lives of the assets, generally 40 years for buildings, 20 years for land improvements, 5 to 20 years for building improvements and one to ten years for furniture, fixtures and equipment. Renovations and/or replacements at the hotel properties that improve or extend the life of the assets are capitalized and depreciated over their useful lives, while repairs and maintenance are expensed as incurred. Upon the sale or retirement of property and equipment, the cost and related accumulated depreciation are removed from the Company’s accounts and any resulting gain or loss is recognized in the consolidated statements of operations.

Our hotel properties are periodically reviewed for impairment whenever events or changes in circumstances indicate that the carrying value of the hotel properties may not be recoverable over management's estimated holding period. This estimated holding period incorporates management’s intent and ability to hold the hotel properties over the estimated holding period. Events or circumstances that may cause a review include, but are not limited to, adverse changes in the demand for lodging at the properties due to declining national or local economic conditions and/or new hotel construction in markets where the hotels are located. When such conditions exist, management will perform an analysis to determine if the estimated undiscounted future cash flows, without interest charges, from operations and the proceeds from the ultimate disposition of a hotel property exceed its carrying value. If the estimated undiscounted future cash flows are less than the carrying amount, an adjustment to reduce the carrying amount to the related hotel property's estimated fair value is recorded and an impairment loss recognized. For the year ended December 31, 2025, there were no impairment losses. For the year ended December 31, 2024, the Company incurred an impairment loss on one hotel property. For the year ended December 31, 2023, the Company incurred an impairment loss on one hotel property (See Note 5).

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For properties the Company considers held for sale, depreciation and amortization are no longer recorded and the value of the properties is recorded at the lower of depreciated cost or fair value, less costs to sell. If circumstances arise that were previously considered unlikely, and, as a result, the Company decides not to sell a property previously classified as held for sale, the Company will reclassify such property as held and used. Such property is measured at the lower of its carrying amount (adjusted for any depreciation and amortization expense that would have been recognized had the property been continuously classified as held and used) or fair value at the date of the subsequent decision not to sell. The Company classifies properties as held for sale when all criteria within the Financial Accounting Standards Board's ("FASB") guidance on the impairment or disposal of long-lived assets are met. As of December 31, 2025, we had no hotel properties that met the criteria to be presented as held for sale.

Revenue Recognition

Revenue from hotel operations is recognized when rooms are occupied and when services are provided. Revenue consists of amounts derived from hotel operations, including sales from room, meeting room, gift shop, in-room movie and other ancillary amenities. Sales, use, occupancy, and similar taxes are collected and presented on a net basis (excluded from revenues) in the accompanying consolidated statements of operations.

Share-Based Compensation

We measure compensation expense for the restricted share awards based upon the fair market value of our common shares at the date of grant. The Company measures compensation expense for the Time-Based and Performance-Based LTIP units based upon the Monte Carlo approach using volatility, dividend yield and a risk free interest rate in the valuation. Compensation expense is recognized on a straight-line basis over the vesting period and is included in general and administrative expense in the accompanying consolidated statements of operations. We pay dividends on vested and non-vested restricted shares and Time-Based LTIP units. The Company has also issued Performance-Based LTIP units as part of its compensation plan. Under the terms of the Performance-Based LTIP units, a holder of a Performance-Based LTIP unit will generally (i) be entitled to receive 10% of the distributions made on a common unit of the Operating Partnership during the period prior to vesting of such Performance-Based LTIP unit (the “Pre-Vesting Distributions”), (ii) be entitled, upon the vesting of such Performance-Based LTIP unit, to receive a special one-time “catch-up” distribution equal to the aggregate amount of distributions that were paid on a common unit during the period prior to vesting of such Performance-Based LTIP unit minus the aggregate amount of Pre-Vesting Distributions paid on such Performance-Based LTIP unit, and (iii) be entitled, following the vesting of such Performance-Based LTIP unit, to receive the same amount of distributions paid on a common unit of the Operating Partnership.

Income Taxes

We elected to be taxed as a REIT for federal income tax purposes commencing with our 2010 taxable year. In order to qualify as a REIT under the Code, we must meet certain organizational and operational requirements, including a requirement to distribute at least 90% of our annual REIT taxable income to our shareholders (which is computed without regard to the dividends paid deduction or net capital gain and which does not necessarily equal net income as calculated in accordance with GAAP). As a REIT, we generally will not be subject to federal income tax to the extent we currently distribute our taxable income to our shareholders. If we fail to qualify as a REIT in any taxable year, we will be subject to federal income tax on our taxable income at regular corporate income tax rates and generally will not be permitted to qualify for treatment as a REIT for federal income tax purposes for the four taxable years following the year during which qualification is lost unless the IRS grants us relief under certain statutory provisions. Such an event could materially adversely affect our net income and net cash available for distribution to shareholders. However, we believe we have been organized and that we operate in such a manner as to qualify for treatment as a REIT.

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