# Sunstone Hotel Investors, Inc. (SHO) Informational only - not investment advice. CIK: 0001295810 SIC: 7011 Hotels & Motels SIC breadcrumb: [Services](/division/I/) > [SIC Major Group 70](/major-group/70/) > [SIC 7011 Hotels & Motels](/industry/7011/) Latest 10-K filed: 2026-02-27 SEC page: https://www.sec.gov/edgar/browse/?CIK=1295810 Filing source: https://www.sec.gov/Archives/edgar/data/1295810/000110465926021440/sho-20251231x10k.htm ## Selected Fundamentals | Metric | Value | Unit | FY | Filed | | --- | ---: | --- | ---: | --- | | Revenue | 960126000 | USD | 2025 | 2026-02-27 | | Net income | 24568000 | USD | 2025 | 2026-02-27 | | Assets | 3029005000 | 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/CIK0001295810.json. Derived margins are computed from the extracted annual SEC facts. | Metric | 2009 | 2010 | 2011 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | | --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | | Revenue | | | | | | 1,159,053,000 | 1,115,167,000 | 267,906,000 | 509,150,000 | 912,053,000 | 986,480,000 | 905,809,000 | 960,126,000 | | Net income | | | | 140,677,000 | 153,004,000 | 259,059,000 | 142,793,000 | -410,506,000 | 32,995,000 | 90,766,000 | 206,708,000 | 43,262,000 | 24,568,000 | | Diluted EPS | -4.17 | 0.18 | 0.45 | | | | | -1.93 | 0.06 | 0.34 | 0.93 | 0.14 | 0.04 | | Assets | | | | 3,739,234,000 | 3,857,812,000 | 3,972,833,000 | 3,918,974,000 | 2,985,717,000 | 3,041,049,000 | 3,082,817,000 | 3,149,321,000 | 3,106,639,000 | 3,029,005,000 | | Liabilities | | | | 1,207,402,000 | 1,275,634,000 | 1,261,662,000 | 1,297,903,000 | 896,338,000 | 801,275,000 | 997,856,000 | 982,683,000 | 1,002,619,000 | 1,084,387,000 | | Stockholders' equity | | | | 2,482,770,000 | 2,533,738,000 | 2,663,486,000 | 2,574,838,000 | 2,048,644,000 | 2,198,967,000 | 2,084,961,000 | 2,166,638,000 | 2,104,020,000 | 1,944,618,000 | | Cash and cash equivalents | | | | 369,537,000 | 488,002,000 | 809,316,000 | 816,857,000 | 368,406,000 | 120,483,000 | 101,223,000 | 426,403,000 | 107,199,000 | 109,189,000 | | Net margin | | | | | | 22.35% | 12.80% | | 6.48% | 9.95% | 20.95% | 4.78% | 2.56% | ## Quarterly Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-05-05. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001295810.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 | | --- | --- | ---: | ---: | ---: | --- | | 2022-Q2 | 2022-06-30 | | | 0.15 | reported discrete quarter | | 2022-Q3 | 2022-09-30 | | | 0.08 | reported discrete quarter | | 2023-Q2 | 2023-03-31 | | 21,087,000 | | reported discrete quarter | | 2023-Q1 | 2023-03-31 | | | 0.08 | reported discrete quarter | | 2023-Q2 | 2023-06-30 | 276,112,000 | | 0.19 | reported discrete quarter | | 2023-Q3 | 2023-06-30 | | 43,078,000 | | reported discrete quarter | | 2023-Q3 | 2023-09-30 | 247,700,000 | | 0.06 | reported discrete quarter | | 2023-Q4 | 2023-12-31 | 219,225,000 | 126,985,000 | | derived Q4 = FY annual - nine-month YTD | | 2024-Q1 | 2024-03-31 | 217,166,000 | 13,035,000 | 0.05 | reported discrete quarter | | 2024-Q2 | 2024-03-31 | | 13,035,000 | | reported discrete quarter | | 2024-Q3 | 2024-06-30 | | 26,142,000 | | reported discrete quarter | | 2024-Q2 | 2024-06-30 | 247,481,000 | | 0.11 | reported discrete quarter | | 2024-Q3 | 2024-09-30 | 226,392,000 | | 0.00 | reported discrete quarter | | 2024-Q4 | 2024-12-31 | 214,770,000 | 836,000 | | derived Q4 = FY annual - nine-month YTD | | 2025-Q1 | 2025-03-31 | 234,065,000 | 5,255,000 | 0.01 | reported discrete quarter | | 2025-Q2 | 2025-03-31 | | 5,255,000 | | reported discrete quarter | | 2025-Q3 | 2025-06-30 | | 10,774,000 | | reported discrete quarter | | 2025-Q2 | 2025-06-30 | 259,772,000 | | 0.03 | reported discrete quarter | | 2025-Q3 | 2025-09-30 | 229,323,000 | | -0.02 | reported discrete quarter | | 2025-Q4 | 2025-12-31 | 236,966,000 | 7,217,000 | | derived Q4 = FY annual - nine-month YTD | | 2026-Q1 | 2026-03-31 | 259,709,000 | 18,557,000 | 0.08 | 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/1295810/000110465926055508/sho-20260331x10q.htm Extracted between Part I Item 2 and the next Item 3/4 or Part II heading after HTML sanitization. Confidence: high Filing date: 2026-05-05 Report date: 2026-03-31 Item 2.Management’s Discussion and Analysis of Financial Condition and Results of Operations ​ Overview ​ Sunstone Hotel Investors, Inc. (the “Company,” “we,” “our” or “us”) is a Maryland corporation. We operate as a self-managed and self-administered real estate investment trust (“REIT”). A REIT is a corporation that directly or indirectly owns real estate assets and has elected to be taxable as a real estate investment trust for federal income tax purposes. To qualify for taxation as a REIT, the REIT must meet certain requirements, including regarding the composition of its assets and the sources of its income. REITs generally are not subject to federal income taxes at the corporate level as long as they pay stockholder dividends equivalent to 100% of their taxable income. REITs are required to distribute to stockholders at least 90% of their REIT taxable income. We own, directly or indirectly, 100% of the interests of Sunstone Hotel Partnership, LLC (the “Operating Partnership”), which is the entity that directly or indirectly owns our hotels. We also own 100% of the interests of our taxable REIT subsidiary, Sunstone Hotel TRS Lessee, Inc. (the “TRS Lessee”), which, directly or indirectly, leases all of our hotels from the Operating Partnership, and engages independent third parties to manage our hotels. ​ We own hotels in convention, urban, and resort destinations that benefit from significant barriers to entry by competitors and diverse economic drivers. As of March 31, 2026, we owned 14 hotels, which average 500 rooms in size. All of our hotels are operated under nationally recognized brands, except the Oceans Edge Resort & Marina, which operates independently. ​ Maui Storms ​ During the first quarter of 2026, the Hawaiian Islands experienced multiple severe storms that impacted our Wailea Beach Resort. The resort remained open during and following the storms that occurred in March but sustained wind and water damage in some of the guestrooms, public areas, and portions of the resort’s roofs. We maintain customary property, casualty, environmental, flood, and business interruption insurance at all of our hotels; however, such coverage is subject to certain limitations, conditions, and deductibles. ​ We are continuing to assess the extent of the damage; however, based on currently available information and the preliminary nature of this assessment, we are not able to reasonably estimate the loss associated with the damaged assets at this time. We are working with our insurers to identify and pursue relevant insurance recoveries related to repair and restoration costs. In addition, we are pursuing and expect to receive recoveries for business interruption on estimated lost profits associated with the storm-related damage. Storm-related costs will be recognized as incurred, to the extent determinable. Any insurance recoveries for business interruption, if realized, are expected to generally be recognized in the period or periods in which they are received. ​ Operating Activities ​ Revenues. Substantially all of our revenues are derived from the operation of our hotels. Specifically, our revenues consist of the following: ​ ● Room revenue, which is comprised of revenue realized from the sale of rooms at our hotels; ​ ● Food and beverage revenue, which is comprised of revenue realized in the hotel food and beverage outlets as well as banquet and catering events; and ​ ● Other operating revenue, which includes ancillary hotel revenue and other items primarily driven by occupancy such as telephone/internet, parking, spa, destination and resort fees, entertainment, and other guest services. Additionally, this category includes, among other things, attrition and cancellation revenue, tenant revenue derived from hotel space and marina slips leased by third parties, winery revenue, any business interruption proceeds and any performance guarantee or reimbursements to offset net losses. ​ Expenses. Our expenses consist of the following: ​ ● Room expense, which is primarily driven by occupancy and, therefore, has a significant correlation with room revenue; ​ ● Food and beverage expense, which is primarily driven by hotel food and beverage sales and banquet and catering bookings and, therefore, has a significant correlation with food and beverage revenue; ​ ● Other operating expense, which includes the corresponding expense of other operating revenue, advertising and promotion, repairs and maintenance, utilities, and franchise costs; 22 Table of Contents ​ ● Property tax, ground lease and insurance expense, which includes the expenses associated with property tax, ground lease and insurance payments, each of which is primarily a fixed expense, however property tax is subject to regular revaluations based on the specific tax regulations and practices of each municipality, along with our cash and noncash operating lease expenses, general excise tax assessed by Hawaii and taxes assessed on commercial rents by San Francisco and Texas; ​ ● Other property-level expenses, which includes our property-level general and administrative expenses, such as payroll, benefits, and other employee-related expenses, contract and professional fees, credit and collection expenses, employee recruitment, relocation and training expenses, labor dispute expenses, consulting fees, management fees, and other expenses; ​ ● Corporate overhead expense, which includes our corporate-level expenses, such as payroll, benefits, and other employee-related expenses, amortization of deferred stock compensation, business acquisition and due diligence expenses, legal expenses, contract and professional fees, board of director expenses, entity-level state franchise and minimum taxes, travel expenses, office rent, and other customary expenses; and ​ ● Depreciation and amortization expense, which includes depreciation on our hotel buildings, improvements, furniture, fixtures and equipment (“FF&E”), along with amortization on our franchise fees and certain intangibles. Additionally, this category includes depreciation and amortization related to FF&E for our corporate office. ​ Other Revenue and Expense. Other revenue and expense consists of the following: ​ ● Interest and other income, which includes interest we have earned on our restricted and unrestricted cash accounts, as well as any energy or other rebates, net property insurance proceeds we have received, miscellaneous income, and any gains or losses we have recognized on sales or redemptions of assets other than real estate investments; ​ ● Interest expense, which includes interest expense incurred on our outstanding fixed and variable rate debt, gains or losses on interest rate derivatives, amortization of deferred financing costs, and any loan fees incurred on our debt, net of any capitalized interest; ​ ● Gain (loss) on sale of assets, net, which includes the gains or losses we recognized on our hotel sales, including the net gains related to the resolution of contingencies, that do not qualify as discontinued operations; ​ ● Gain (loss) on extinguishment of debt, which includes gains related to the resolution of contingencies on extinguished debt and losses recognized on amendments or early repayments of mortgages or other debt obligations from the accelerated amortization of deferred financing costs, along with any other costs; ​ ● Income tax (provision) benefit, net, which includes federal and state income taxes charged to us net of any refundable credits or refunds received, any adjustments to deferred tax assets, liabilities or valuation allowances, and any adjustments to unrecognized tax positions, along with any related interest and penalties incurred; and ​ ● Preferred stock dividends, net of gain on repurchases, which includes dividends accrued on our Series G Cumulative Redeemable Preferred Stock (“Series G preferred stock”), Series H Cumulative Redeemable Preferred Stock (“Series H preferred stock”) and Series I Cumulative Redeemable Preferred Stock (“Series I preferred stock”), net of any preferred stock repurchased at a discount to its carrying value, along with the related write-off of any original issuance costs previously included in additional paid in capital. ​ Operating Performance Indicators. The following performance indicators are commonly used in the hotel industry: ​ ● Occupancy, which is the quotient of total rooms sold divided by total rooms available; ​ ● Average daily room rate, or ADR, which is the quotient of room revenue divided by total rooms sold; ​ ● Revenue per available room, or RevPAR, which is the product of occupancy and ADR, and does not include food and beverage revenue, or other operating revenue; ​ ● RevPAR index, which is the quotient of a hotel’s RevPAR divided by the average RevPAR of its competitors, multiplied by 100. A RevPAR index in excess of 100 indicates a hotel is achieving higher RevPAR than the average of its competitors. In addition to absolute RevPAR index, we monitor changes in RevPAR index; 23 Table of Contents ​ ● EBITDAre, which is net income excluding: interest expense; benefit or provision for income taxes, including any changes to deferred tax assets, liabilities or valuation allowances and income taxes applicable to the sale of assets; depreciation and amortization; gains or losses on disposition of depreciated property (including gains or losses on change in control); and any impairment write-downs of depreciated property; ​ ● Adjusted EBITDAre, which is EBITDAre adjusted to exclude: amortization of deferred stock compensation; amortization of contract intangibles; amortization of right-of-use assets and obligations; the impact of any gain or loss from undepreciated asset sales or property damage from natural disasters; any lawsuit settlement costs; the write-off of development costs associated with abandoned projects; property-level restructuring, severance, and management transition costs; pre-opening costs associated with extensive renovation projects; debt resolution costs; and any other nonrecurring identified adjustments; ​ ● Funds from operations (“FFO”) attributable to common stockholders, which is net income and preferred stock dividends, including any gains or losses on the redemptions or repurchases of preferred stock, excluding: gains and losses from sales of property; real estate-related depreciation and amortization (excluding amortization of deferred financing costs and right-of-use assets and obligations); and any real estate-related impairment losses; and ​ ● Adjusted FFO attributable to common stockholders, which is FFO attributable to common stockholders adjusted to exclude: amortization of deferred stock compensation; amortization of contract intangibles; real estate-related amortization of right-of-use assets and obligations; noncash interest on our derivatives; income tax benefits or provisions associated with any changes to deferred tax assets, liabilities or valuation allowances, the application of net operating loss carryforwards, uncertain tax positions or with the sale of assets; gains or losses due to property damage from natural disasters; any lawsuit settlement costs; the write-off of development costs associated with abandoned projects; non-real estate-related impairment losses; property-level restructuring, severance, and management transition costs; pre-opening costs associated with extensive renovation projects; debt resolution costs; gains or losses on the redemptions or repurchases of preferred stock; and any other nonrecurring identified adjustments. ​ Factors Affecting Our Operating Results. The primary factors affecting our operating results include overall demand for hotel rooms, the pace of new hotel development, or supply, and the relative performance of our operators in increasing revenue and controlling hotel operating expenses. ​ ● Demand. The deman [Excerpt truncated for page length; source filing is linked above.] ## Latest 10-K MD&A Extracted between Item 7 and the next Item 7A/8 heading after HTML sanitization. Confidence: high Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations ​ The following discussion should be read together with the consolidated financial statements and related notes included elsewhere in this report. This discussion focuses on our financial condition and results of operations for the year ended December 31, 2025 as compared to the year ended December 31, 2024. A discussion and analysis of the year ended December 31, 2024 as compared to the year ended December 31, 2023 is included in our Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February 21, 2025, under the caption “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.” ​ Overview ​ Sunstone Hotel Investors, Inc. is a Maryland corporation. We operate as a self-managed and self-administered real estate investment trust (“REIT”). A REIT is a corporation that directly or indirectly owns real estate assets and has elected to be taxable as a real estate investment trust for federal income tax purposes. To qualify for taxation as a REIT, the REIT must meet certain requirements, including regarding the composition of its assets and the sources of its income. REITs generally are not subject to federal income taxes at the corporate level as long as they pay stockholder dividends equivalent to 100% of their taxable income. REITs are required to distribute to stockholders at least 90% of their REIT taxable income. We own, directly or indirectly, 100% of the interests of Sunstone Hotel Partnership, LLC, (the “Operating Partnership”), which is the entity that directly or indirectly owns our hotels. We also own 100% of the interests of our taxable REIT subsidiary, Sunstone Hotel TRS Lessee, Inc. (the “TRS Lessee”), which, directly or indirectly, leases all of our hotels from the Operating Partnership, and engages independent third parties to manage our hotels. ​ We own hotels in convention, urban, and resort destinations that benefit from significant barriers to entry by competitors and diverse economic drivers. As of December 31, 2025, we owned 14 hotels. All of our hotels are operated under nationally recognized brands, except the Oceans Edge Resort & Marina, which operates independently. ​ The following tables summarize our total portfolio and room data from January 1, 2024 through December 31, 2025: ​ ​ ​ ​ ​ ​ ​   ​ ​ ​ 2025   ​ ​ ​ 2024 Portfolio Data—Hotels ​ ​ ​ ​ ​ Number of hotels—beginning of year 15 14 ​ Add: Acquisitions ​ — ​ 1 ​ Less: Dispositions (1) — ​ Number of hotels—end of year 14 ​ 15 ​ 35 Table of Contents ​ ​ ​ ​ ​ ​ ​ ​   ​ ​ ​ 2025   ​ ​ ​ 2024 Portfolio Data—Rooms ​ ​ ​ ​ ​ Number of rooms—beginning of year 7,253 6,675 ​ Add: Acquisitions ​ — ​ 630 ​ Less: Dispositions ​ (252) ​ — ​ Less: Renovation adjustments, net (1) (2) ​ (52) ​ Number of rooms—end of year 6,999 7,253 ​ Average rooms per hotel—end of year 500 484 ​ (1) Concurrent with our renovations, we removed two rooms at the Wailea Beach Resort to form two residential-style suites in 2025. Similarly, in 2024, we removed fifty-two rooms at The Confidante Miami Beach in conjunction with its transition to Andaz Miami Beach to increase the number of suites and premium room types. In addition, in 2024 we removed two rooms at Wailea Beach Resort to form two residential-style suites and added two rooms at Marriott Long Beach Downtown. ​ 2025 Summary ​ Demand. Excluding The Confidante Miami Beach and Renaissance Long Beach (the “Two Renovation Hotels”) due to their significant renovations as they transitioned to Andaz Miami Beach and Marriott Long Beach Downtown, respectively, occupancy at the 11 hotels we owned during the entirety of 2024 and 2025 (the “Comparable Portfolio”) improved as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Quarters Ended ​ Year Ended ​ March 31 June 30 September 30 December 31 ​ December 31 2025 73.1 % 77.9 % 73.6 % 68.4 % ​ 73.2 % 2024 72.1 % 76.6 % 72.9 % 67.0 % ​ 72.2 % ​ During 2025, we saw continued strength in group demand, primarily at Hyatt Regency San Francisco, Wailea Beach Resort, The Bidwell Marriott Portland, Montage Healdsburg, and Hilton San Diego Bayfront. In addition, we saw strong corporate demand at The Bidwell Marriott Portland, The Westin Washington, DC Downtown, Marriott Boston Long Wharf, and Hyatt Regency San Francisco driven in part by airline crew contracts. These positive impacts were partially offset by the slower recovery of leisure demand in Maui and by displacement associated with the completion of a rooms renovation at the Wailea Beach Resort, both of which negatively affected transient demand, as well as by lower leisure demand at Oceans Edge Resort & Marina. In addition, Hilton San Diego Bayfront, Marriott Boston Long Wharf, and The Westin Washington, DC Downtown were negatively impacted by a reduction in government-related travel, including organizations whose conferences are partially funded by the government and the effect of the government shut down in the fourth quarter of 2025. ​ Disposition. In June 2025, we sold the Hilton New Orleans St. Charles, located in Louisiana for a gross sale price of $47.0 million and recorded a loss of $8.8 million. ​ Significant Renovations. During 2025, our significant renovations primarily consisted of the completion of the Andaz Miami Beach transformation, resulting in the resort reopening in May 2025, a rooms renovation at Wailea Beach Resort, and renovations of the meeting spaces at Hyatt Regency San Antonio Riverwalk and Hilton San Diego Bayfront. ​ Debt Transactions. In April 2025, we exercised our option to extend the maturity date of the previous Term Loan 3 from May 2025 to May 2026. ​ In September 2025, we entered into the Third Amended and Restated Credit Agreement (the “Amended Credit Agreement”), which expanded our unsecured debt borrowing capacity and extended the maturity of our term loans. The Amended Credit Agreement continues to provide for a $500.0 million revolving credit facility and increases the aggregate amount of our term loan facilities from $675.0 million (on four existing term loans) to $850.0 million (on three new term loans). Inclusive of extension options, the revolving credit facility and new term loan facilities under the Amended Credit Agreement mature at various points in 2030 and 2031, respectively, but are freely prepayable at any time. The revolving credit facility and the new term loan facilities bear interest pursuant to a leverage-based pricing grid ranging from 1.40% to 2.25% and 1.35% to 2.20%, respectively, over the applicable term SOFR. In connection with the new term loan facilities, we entered into a series of interest rate swaps to lower our borrowing cost and better manage interest rate risk. ​ 36 Table of Contents For more details on our debt transactions, see disclosures under the Debt caption included in “Liquidity and Capital Resources” below. ​ Capital Transactions. During 2025, we repurchased the following shares under our stock repurchase program: ​ ● Common stock: 11,589,722 shares at an average purchase price per share of $8.83; ​ ● Series H Cumulative Redeemable Preferred Stock (“Series H preferred stock”): 54,097 shares at an average purchase price per share of $20.28; and ​ ● Series I Cumulative Redeemable Preferred Stock (“Series I preferred stock”): 9,027 shares at an average purchase price per share of $19.25. ​ As of December 31, 2025, approximately $323.9 million of authorized capacity remained under our stock repurchase program. ​ Operating Activities ​ Revenues. Substantially all of our revenues are derived from the operation of our hotels. Specifically, our revenues consist of the following: ​ ● Room revenue, which is comprised of revenue realized from the sale of rooms at our hotels; ​ ● Food and beverage revenue, which is comprised of revenue realized in the hotel food and beverage outlets as well as banquet and catering events; and ​ ● Other operating revenue, which includes ancillary hotel revenue and other items primarily driven by occupancy such as telephone/internet, parking, spa, destination and resort fees, entertainment, and other guest services. Additionally, this category includes, among other things, attrition and cancellation revenue, tenant revenue derived from hotel space and marina slips leased by third parties, winery revenue, any business interruption proceeds and any performance guarantee or reimbursements to offset net losses. ​ Expenses. Our expenses consist of the following: ​ ● Room expense, which is primarily driven by occupancy and, therefore, has a significant correlation with room revenue; ​ ● Food and beverage expense, which is primarily driven by hotel food and beverage sales and banquet and catering bookings and, therefore, has a significant correlation with food and beverage revenue; ​ ● Other operating expense, which includes the corresponding expense of other operating revenue, advertising and promotion, repairs and maintenance, utilities, and franchise costs; ​ ● Property tax, ground lease and insurance expense, which includes the expenses associated with property tax, ground lease and insurance payments, each of which is primarily a fixed expense, however property tax is subject to regular revaluations based on the specific tax regulations and practices of each municipality, along with our cash and noncash operating lease expenses, general excise tax assessed by Hawaii and taxes assessed on commercial rents by San Francisco and Texas; ​ ● Other property-level expenses, which includes our property-level general and administrative expenses, such as payroll, benefits, and other employee-related expenses, contract and professional fees, credit and collection expenses, employee recruitment, relocation and training expenses, labor dispute expenses, consulting fees, management fees, and other expenses; ​ ● Corporate overhead expense, which includes our corporate-level expenses, such as payroll, benefits, and other employee-related expenses, amortization of deferred stock compensation, business acquisition and due diligence expenses, legal expenses, contract and professional fees, board of director expenses, entity-level state franchise and minimum taxes, travel expenses, office rent, and other customary expenses; and ​ ● Depreciation and amortization expense, which includes depreciation on our hotel buildings, improvements, and FF&E, along with amortization on our franchise fees and certain intangibles. Additionally, this category includes depreciation and amortization related to FF&E for our corporate office. ​ Other Revenue and Expense. Other revenue and expense consists of the following: ​ ● Interest and other income, which includes interest we have earned on our restricted and unrestricted cash accounts, as well as any energy or other rebates, net property insurance proceeds we have received, miscellaneous income, and any gains or losses we have recognized on sales or redemptions of assets other than real estate investments; ​ 37 Table of Contents ● Interest expense, which includes interest expense incurred on our outstanding fixed and variable rate debt, gains or losses on interest rate derivatives, amortization of deferred financing costs, and any loan fees incurred on our debt, net of any capitalized interest; ​ ● Gain (loss) on sale of assets, net, which includes the gains or losses we recognized on our hotel sales, including the net gains related to the resolution of contingencies, that do not qualify as discontinued operations; ​ ​ ● Gain (loss) on extinguishment of debt, which includes gains related to the resolution of contingencies on extinguished debt and losses recognized on amendments or early repayments of mortgages or other debt obligations from the accelerated amortization of deferred financing costs, along with any other costs; ​ ● Income tax (provision) benefit, net, which includes federal and state income taxes charged to us net of any refundable credits or refunds received, any adjustments to deferred tax assets, liabilities or valuation allowances, and any adjustments to unrecognized tax positions, along with any related interest and penalties incurred; and ​ ● Preferred stock dividends, net of gain on repurchases, which includes dividends accrued on our Series G Cumulative Redeemable Preferred Stock (“Series G preferred stock”), Series H preferred stock, and Series I preferred stock, net of any preferred stock repurchased at a discount to its carrying value, along with the related write-off of any original issuance costs previously included in additional paid in capital. ​ Operating Performance Indicators. The following performance indicators are commonly used in the hotel industry: ​ ● Occupancy, which is the quotient of total rooms sold divided by total rooms available; ​ ● Average daily room rate, or ADR, which is the quotient of room revenue divided by total rooms sold; ​ ● Revenue per available room, or RevPAR, which is the product of occupancy and ADR, and does not include food and beverage revenue, or other operating revenue; ​ ● RevPAR index, which is the quotient of a hotel’s RevPAR divided by the average RevPAR of its competitors, multiplied by 100. A RevPAR index in excess of 100 indicates a hotel is achieving higher RevPAR than the average of its competitors. In addition to absolute RevPAR index, we monitor changes in RevPAR index; ​ ● EBITDAre, which is net income excluding: interest expense; benefit or provision for income taxes, including any changes to deferred tax assets, liabilities or valuation allowances and income taxes applicable to the sale of assets; depreciation and amortization; gains or losses on disposition of depreciated property (including gains or losses on change in control); and any impairment write-downs of depreciated property; ​ ● Adjusted EBITDAre, which is EBITDAre adjusted to exclude: amortization of deferred stock compensation; amortization of contract intangibles; amortization of right-of-use assets and obligations; the impact of any gain or loss from undepreciated asset sales or property damage from natural disasters; any lawsuit settlement costs; the write-off of development costs associated with abandoned projects; property-level restructuring, severance, and management transition costs; pre-opening costs associated with extensive renovation projects; debt resolution costs; and any other nonrecurring identified adjustments; ​ ● Funds from operations (“FFO”) attributable to common stockholders, which is net income and preferred stock dividends, including any gains or losses on the redemptions or repurchases of preferred stock, excluding: gains and losses from sales of property; real estate-related depreciation and amortization (excluding amortization of deferred financing costs and right-of-use assets and obligations); and any real estate-related impairment losses; and ​ ● Adjusted FFO attributable to common stockholders, which is FFO attributable to common stockholders adjusted to exclude: amortization of deferred stock compensation; amortization of contract intangibles; real estate-related amortization of right-of-use assets and obligations; noncash interest on our derivatives; income tax benefits or provisions associated with any changes to deferred tax assets, liabilities or valuation allowances, the application of net operating loss carryforwards, uncertain tax positions or with the sale of assets; gains or losses due to property damage from natural disasters; any lawsuit settlement costs; the write-off of development costs associated with abandoned projects; non-real estate-related impairment losses; property-level restructuring, severance, and management transition costs; pre-opening costs associated with extensive renovation projects; debt resolution costs; gains or losses on the redemptions or repurchases of preferred stock; and any other nonrecurring identified adjustments. ​ Factors Affecting Our Operating Results. The primary factors affecting our operating results include overall demand for hotel rooms, the pace of new hotel development, or supply, and the relative performance of our operators in increasing revenue and controlling hotel operating expenses. ​ 38 Table of Contents ● Demand. The demand for lodging has traditionally been closely linked with the performance of the general economy. Our hotels are classified as either upper upscale or luxury hotels. In periods of economic difficulties, including those caused by inflation or recession, these types of hotels may be more susceptible to a decrease in revenue, as compared to hotels in other categories that have lower room rates in part because upper upscale and luxury hotels generally target business and leisure travelers at higher price points, and these groups may seek to curtail spending in periods of economic decline. In addition, changes in the value of the U.S. dollar relative to other currencies may impact the demand for our hotels by making international travel more or less affordable. Also, operating results at our hotels may be negatively affected by uncertainty surrounding certain international economic and political relationships, including political disputes and unfavorable perceptions of travel to the U.S., which could further reduce international travel demand. Also, volatility in transportation fuel costs, increases in air and ground travel costs, decreases in airline capacity, government shutdowns, the imposition of tariffs, and prolonged periods of inclement weather in our markets may reduce the demand for our hotels. ​ ● Supply. The addition of new competitive hotels affects the ability of existing hotels to attract demand for lodging and, therefore, impacts the ability to generate growth in RevPAR and profits. The development of new hotels is largely driven by construction costs, the cost and availability of financing, and the expected performance of existing hotels. We believe that both new hotel construction and new hotel openings were delayed or even cancelled over the past several years due to construction supply constraints, the cost and availability of financing, and inflationary pressures on the cost of building materials, which made new hotel development less financially feasible. We believe that many of these same factors combined with the recent imposition of tariffs will continue to discourage new hotel supply in many markets, although some markets may experience new hotel openings at or greater than historical levels. Separate from the development of new hotels, an increase in the supply of vacation rental or sharing services such as Airbnb may negatively affect the ability of existing hotels to generate growth in RevPAR and profits. ​ ● Revenues and expenses. We believe that marginal improvements in RevPAR index, even in the face of declining revenues, are a good indicator of the relative quality and appeal of our hotels, and our operators’ effectiveness in maximizing revenues. Similarly, we also evaluate our operators’ effectiveness in minimizing incremental operating expenses in the context of increasing revenues or, conversely, in reducing operating expenses in the context of declining revenues. Inflationary pressures could increase operating costs, which could limit our operators’ effectiveness in minimizing expenses. ​ Operating Results. The following table presents our operating results for the years ended December 31, 2025 and 2024, including the amount and percentage change in the results between the two periods. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​   ​ ​ ​ 2025   ​ ​ ​ 2024   ​ ​ ​ Change $   ​ ​ ​ Change % ​ ​ (in thousands, except statistical data) REVENUES ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Room ​ $ 582,669 ​ $ 559,061 ​ $ 23,608 ​ 4.2 % Food and beverage ​ ​ 278,680 ​ 256,222 ​ ​ 22,458 ​ 8.8 % Other operating ​ ​ 98,777 ​ 90,526 ​ ​ 8,251 ​ 9.1 % Total revenues ​ ​ 960,126 ​ 905,809 ​ ​ 54,317 ​ 6.0 % OPERATING EXPENSES ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Hotel operating ​ ​ 600,964 ​ 562,827 ​ ​ 38,137 ​ 6.8 % Other property-level expenses ​ ​ 117,348 ​ 110,833 ​ ​ 6,515 ​ 5.9 % Corporate overhead ​ ​ 31,590 ​ 29,050 ​ ​ 2,540 ​ 8.7 % Depreciation and amortization ​ ​ 134,508 ​ ​ 124,507 ​ ​ 10,001 ​ 8.0 % Total operating expenses ​ ​ 884,410 ​ 827,217 ​ ​ 57,193 ​ 6.9 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Interest and other income ​ ​ 10,964 ​ 13,179 ​ ​ (2,215) ​ (16.8) % Interest expense ​ ​ (52,965) ​ (50,125) ​ ​ (2,840) ​ (5.7) % (Loss) gain on sale of assets, net ​ ​ (8,751) ​ 457 ​ ​ (9,208) ​ (2,014.9) % (Loss) gain on extinguishment of debt ​ ​ (180) ​ ​ 59 ​ ​ (239) ​ (405.1) % Income before income taxes ​ ​ 24,784 ​ 42,162 ​ ​ (17,378) ​ (41.2) % Income tax (provision) benefit, net ​ ​ (216) ​ 1,100 ​ (1,316) ​ (119.6) % NET INCOME ​ ​ 24,568 ​ 43,262 ​ ​ (18,694) ​ (43.2) % Preferred stock dividends, net of gain on repurchases ​ ​ (16,110) ​ (15,228) ​ ​ (882) ​ (5.8) % INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS ​ $ 8,458 ​ $ 28,034 ​ $ (19,576) ​ (69.8) % ​ 39 Table of Contents Summary of Operating Results. The following items significantly impact the year-over-year comparability of our operations: ● Hotel Acquisition: In April 2024, we acquired the Hyatt Regency San Antonio Riverwalk. As a result, our 2025 revenues, operating expenses, and depreciation expense are not comparable to 2024. ● Hotel Renovations: Due to the significant renovations at the Two Renovation Hotels, our 2025 revenues and operating expenses are not comparable to 2024. ● Hotel Disposition: In June 2025, we sold the Hilton New Orleans St. Charles. As a result, our 2025 revenues, operating expenses, and depreciation expense are not comparable to 2024. ​ Room Revenue. Room revenue increased $23.6 million, or 4.2%, in 2025 as compared to 2024 as follows: ​ ● The Two Renovation Hotels caused room revenue to increase by $15.6 million. Occupancy increased 2,000 basis points and the average daily room rate increased 15.7%, resulting in an 80.1% increase in RevPAR. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2025 ​ 2024 ​ Change ​ ​   ​ ​ ​ Occ%   ​ ​ ​ ADR   ​ ​ ​ RevPAR   ​ ​ ​ Occ%   ​ ​ ​ ADR   ​ ​ ​ RevPAR   ​ ​ ​ Occ%   ​ ​ ​ ADR   ​ ​ ​ RevPAR ​ Two Renovation Hotels ​ 55.9 %   $ 265.80 ​ $ 148.58 ​ 35.9 %   $ 229.82 ​ $ 82.51 ​ 2,000 bps   15.7 %   80.1 %   ​ ● The acquisition of the Hyatt Regency San Antonio Riverwalk caused room revenue to increase $7.5 million. Occupancy was 66.1% and the average daily room rate was $192.92, resulting in RevPAR of $127.52. ● Room Revenue at the Comparable Portfolio increased $6.2 million. Occupancy increased 100 basis points and the average daily room rate remained relatively constant, resulting in a 1.4% increase in RevPAR. The Comparable Portfolio’s room revenue benefited from continued strength in group activity primarily at Hyatt Regency San Francisco due to increased demand in the market and additional citywide meetings and conferences, and at Hilton San Diego Bayfront due to labor activity during the third and fourth quarters of 2024, which resulted in the cancellation of certain group events and reduced overall business volume at the hotel during 2024. We also saw moderate increases in group revenues during 2025 at Wailea Beach Resort, The Bidwell Marriott Portland, and Montage Healdsburg. In addition, room revenue at The Bidwell Marriott Portland, The Westin Washington, DC Downtown, Marriott Boston Long Wharf, and Hyatt Regency San Francisco benefited from additional corporate and contract revenue. These positive impacts were partially offset by lower leisure demand at Wailea Beach Resort due to slower demand recovery and to displacement from the completion of a rooms renovation and at Oceans Edge Resort & Marina due to a weak Key West market. In addition, Hilton San Diego Bayfront, Marriott Boston Long Wharf, and The Westin Washington, DC Downtown were negatively impacted due to a decline in government-related travel. We expect government-related travel may continue to decline or remain subdued in 2026 as a result of, among other factors, the government’s cost control initiatives and ongoing uncertainty in government operations. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2025 ​ 2024 ​ Change ​   ​ ​ ​ Occ%   ​ ​ ​ ADR   ​ ​ ​ RevPAR   ​ ​ ​ Occ%   ​ ​ ​ ADR   ​ ​ ​ RevPAR   ​ ​ ​ Occ%   ​ ​ ​ ADR   ​ ​ ​ RevPAR Comparable Portfolio ​ 73.2 %   $ 333.94 ​ $ 244.44 72.2 %   $ 333.85 ​ $ 241.04 ​ 100 bps   0.0 %   1.4 % ​ ● The sale of the Hilton New Orleans St. Charles caused room revenue to decrease by $5.7 million. ​ Food and Beverage Revenue. Food and beverage revenue increased $22.5 million, or 8.8%, in 2025 as compared to 2024 as follows: ​ ● Food and beverage revenue at the Comparable Portfolio increased $13.2 million driven by increased banquet and outlet revenues. Banquet revenue increased due to increases in the number of groups and spend per group, along with increases in audio-visual equipment and banquet room rental fees, primarily at Hilton San Diego Bayfront, Hyatt Regency San Francisco, Montage Healdsburg, and The Westin Washington, DC Downtown. In addition, banquet revenue increased at JW Marriott New Orleans due to the Super Bowl in February 2025. These increases in banquet revenue were partially offset by decreased banquet revenue at Four Seasons Resort Napa Valley due to lower group occupancy and a wildfire near the resort which led to group cancellations in the third quarter of 2025. The increase in outlet revenue was primarily due to increases in transient occupancy at Four Seasons Resort Napa Valley and at Renaissance Orlando at SeaWorld®, and due to groups buying out the restaurant at Montage Healdsburg for some of their events. These increases were partially offset by decreased outlet revenue at Marriott Boston Long Wharf due to the conversion of a hotel-operated restaurant to a leased outlet. Both banquet and outlet revenues increased at Hilton San Diego Bayfront due to labor activity during the third and fourth quarters of 2024, which led to the cancellation of certain group events and overall lower business volume at the hotel during the prior year. ● The Two Renovation Hotels caused food and beverage revenue to increase by $7.4 million. 40 Table of Contents ● The acquisition of the Hyatt Regency San Antonio Riverwalk caused food and beverage to increase by $1.9 million. ● The sale of the Hilton New Orleans St. Charles caused a nominal decrease in food and beverage revenue. ​ Other Operating Revenue. Other operating revenue increased $8.3 million, or 9.1%, in 2025 as compared to 2024 as follows: ​ ● Other operating revenue at the Comparable Portfolio increased $4.4 million, primarily due to increased destination and resort fees, cancellation and attrition fees, recreation and pool revenues, residential-related revenues at Montage Healdsburg, spa revenues, and retail revenues. These increases were partially offset by decreased parking revenues. ● The Two Renovation Hotels caused other operating revenue to increase by $2.5 million. ● The acquisition of the Hyatt Regency San Antonio Riverwalk caused other operating revenue to increase by $2.3 million. ● The sale of the Hilton New Orleans St. Charles caused other operating revenue to decrease by $0.9 million. ​ Hotel Operating Expenses. Hotel operating expenses, which are comprised of room, food and beverage, advertising and promotion, repairs and maintenance, utilities, franchise costs, property tax, ground lease and insurance, and other hotel operating expenses increased $38.1 million, or 6.8%, in 2025 as compared to 2024 as follows: ​ ● The Two Renovation Hotels caused hotel operating expenses to increase by $20.5 million. ● Hotel operating expenses at the Comparable Portfolio increased $14.3 million, primarily corresponding to the increases in revenues and occupancy rates, as well as increases in repairs and maintenance, utilities, and liability insurance. In addition, payroll and related expenses increased at Hilton San Diego Bayfront due to reduced labor required at the hotel during the labor activity in the third and fourth quarters of 2024 and at Hyatt Regency San Francisco due to the impact of new union contracts finalized in August this year. These increases were partially offset by decreased property taxes due to favorable appeals and reassessments at several hotels, as well as decreased property insurance resulting from successful policy renewals in the third quarters of both 2025 and 2024. ● The acquisition of the Hyatt Regency San Antonio Riverwalk caused hotel operating expenses to increase by $7.9 million. ● The sale of the Hilton New Orleans St. Charles caused hotel operating expenses to decrease by $4.5 million. ​ Other Property-Level Expenses. Other property-level expenses increased $6.5 million, or 5.9%, in 2025 as compared to 2024 as follows: ​ ● The Two Renovation Hotels caused other property-level expenses to increase by $2.9 million. ● Other property-level expenses at the Comparable Portfolio increased $2.4 million, primarily due to increases in payroll and related expenses, management fees, and credit card commissions. The increase in payroll and related expenses was primarily due to a $1.3 million COVID-19 relief grant received in the first quarter of 2024 at Marriott Boston Long Wharf with no corresponding grant received in 2025. These increased expenses were partially offset by decreased contract and professional fees. ● The acquisition of the Hyatt Regency San Antonio Riverwalk caused other property-level expenses to increase by $2.0 million. ● The sale of the Hilton New Orleans St. Charles caused other property-level expenses to decrease by $0.8 million. ​ Corporate Overhead Expense. Corporate overhead expense increased $2.5 million, or 8.7%, in 2025 as compared to 2024, primarily due to increased payroll and related expenses and deferred stock amortization expense in the first quarter of 2025 in connection with the restructuring of our executive team. The increase in corporate overhead expense was also due to increased professional fees, due diligence fees, board of director expenses, and entity-level state franchise and minimum taxes. These increased expenses were partially offset by decreased deferred stock amortization expense. ​ Depreciation and Amortization Expense. Depreciation and amortization expense increased $10.0 million, or 8.0%, in 2025 as compared to 2024 as follows: ​ ● The Two Renovation Hotels caused depreciation and amortization expense to increase by $7.1 million. ● The acquisition of the Hyatt Regency San Antonio Riverwalk resulted in an increase to depreciation and amortization expense of $2.5 million. 41 Table of Contents ● Depreciation and amortization expense related to the Comparable Portfolio increased $1.8 million due to increased expense at our newly renovated hotels, partially offset by decreased expense due to fully depreciated assets. ● The sale of the Hilton New Orleans St. Charles caused depreciation and amortization expense to decrease by $1.4 million. ​ Interest and Other Income. Interest and other income totaled $11.0 million and $13.2 million in 2025 and 2024, respectively. During 2025 and 2024, we recognized interest income of $5.8 million and $12.6 million, respectively. Interest income decreased in 2025 as compared to 2024 due to decreases in our cash balances following our acquisition of Hyatt Regency San Antonio Riverwalk in April 2024, as well as decreased interest rates. In addition, during 2025, we recognized settlement proceeds of $3.9 million for certain construction-related claims at Oceans Edge Resort & Marina, net property insurance recoveries of $1.1 million related to 2023 fire damage at Hilton San Diego Bayfront and 2025 water damage at The Westin Washington, DC Downtown, and other miscellaneous income of $0.2 million. During 2024, we recognized $0.4 million in property insurance recoveries related to 2023 fire damage at Hilton San Diego Bayfront and wind-driven rain damage at Wailea Beach Resort and $0.1 million in other miscellaneous income. ​ Interest Expense. We incurred interest expense as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2025 ​ 2024 Interest expense on debt ​ $ 49,691 ​ $ 49,003 Noncash interest on derivatives, net ​ 878 ​ (540) Amortization of deferred financing costs ​ ​ 3,797 ​ ​ 3,047 Capitalized interest ​ (1,401) ​ (1,385) Total interest expense ​ $ 52,965 ​ $ 50,125 ​ Interest expense increased $2.8 million, or 5.7%, in 2025 as compared to 2024 as follows: ​ The increase in interest expense in 2025 as compared to 2024 was primarily due to a noncash change of $1.4 million in the fair market value of our derivatives. In addition, interest expense increased $0.8 million in 2025 as compared to 2024 due to increased amortization of deferred financing costs related to costs associated with the execution of the Amended Credit Agreement in September 2025, the extension of the maturity of Term Loan 3 in April 2025, and the issuance of Term Loan 4 in December 2024. Interest expense also increased in 2025 as compared to 2024 due to a $0.7 million increase in interest on our debt primarily due to higher average debt balances, partially offset by lower average interest rates on our term loans. Our debt balances increased due to the net effect of the Amended Credit Agreement, the $50.0 million in total draws on our credit facility in April 2025 and July 2025, and our draw of the $100.0 million available under Term Loan 4 in December 2024. These increases of our debt balances were partially offset by our December 2024 repayment of the $72.1 million loan secured by the JW Marriott New Orleans. ​ Our weighted average interest rate per annum, including our variable rate debt obligations and excluding capitalized interest, was approximately 5.0% and 5.6% at December 31, 2025 and 2024, respectively. Approximately 70.4% and 40.8% of our outstanding notes payable had fixed interest rates or had been swapped to fixed interest rates at December 31, 2025 and 2024, respectively. ​ (Loss) Gain on Sale of Assets, Net. (Loss) gain on sale of assets, net totaled a loss of $8.8 million and a net gain of $0.5 million in 2025 and 2024, respectively. In 2025, we recognized an $8.8 million loss on our sale of the Hilton New Orleans St. Charles. In 2024, we recognized an additional $0.5 million net gain related to a contingency resolution at a hotel sold in a prior year. ​ (Loss) Gain on Extinguishment of Debt. (Loss) gain on extinguishment of debt totaled a loss of $0.2 million and a gain of $0.1 million in 2025 and 2024, respectively. In 2025, we recorded a loss of $0.2 million related to the write-off of unamortized deferred financing costs in connection with the recast of our credit facilities. In 2024, we recorded a $0.1 million gain associated with reassessments of the remaining potential employee-related obligations held in escrow associated with our assignment of a hotel to the hotel’s mortgage holder in 2020. ​ Income Tax (Provision) Benefit, Net. We lease our hotels to the TRS Lessee and its subsidiaries, which are subject to federal and state income taxes. In addition, we and the Operating Partnership may also be subject to various state and local income taxes. ​ We recognized a net current income tax provision of $0.2 million in 2025 and a net current income tax benefit of $1.1 million in 2024, resulting from current state and federal income tax expenses, net of any refunds. ​ 42 Table of Contents Preferred Stock Dividends, Net of Gain on Repurchases. Preferred stock dividends, net of gain on repurchases were incurred as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2025 ​ 2024 ​ Series G preferred stock ​ $ 3,644 ​ $ 2,484 ​ Series H preferred stock ​ ​ 6,813 (1) ​ 7,044 ​ Series I preferred stock ​ ​ 5,653 (1) ​ 5,700 ​ ​ ​ $ 16,110 ​ $ 15,228 ​ (1) Includes net gains of $0.2 million and $0.1 million on the repurchases of the Series H preferred stock and the Series I preferred stock, respectively, repurchased at a discount to their carrying values, along with the related write-off of the original issuance costs previously included in additional paid in capital on our consolidated balance sheets. ​ The dividend rate on the Series G preferred stock increased to the greater of the rate equal to the Montage Healdsburg’s annual net operating income yield on our total investment in the resort or 3.0%, 4.5%, and 6.5% in January 2024, July 2024, and July 2025, respectively, resulting in annual dividend rates of 5.5% and 3.75% for 2025 and 2024, respectively. Beginning in the third quarter of 2026, the annual dividend rate will increase to the greater of 7.5% or the rate equal to the Montage Healdsburg’s annual net operating income yield on our total investment in the resort. ​ Non-GAAP Financial Measures. We use the following “non-GAAP financial measures” that we believe are useful to investors as key supplemental measures of our operating performance: EBITDAre; Adjusted EBITDAre; FFO attributable to common stockholders; and Adjusted FFO attributable to common stockholders. These measures should not be considered in isolation or as a substitute for measures of performance in accordance with accounting principles generally accepted in the United States (“GAAP”). In addition, our calculation of these measures may not be comparable to other companies that do not define such terms exactly the same as us. These non-GAAP measures are used in addition to and in conjunction with results presented in accordance with GAAP. They should not be considered as alternatives to net income (loss), cash flow from operations, or any other operating performance measure prescribed by GAAP. These non-GAAP financial measures reflect additional ways of viewing our operations that we believe, when viewed with our GAAP results and the reconciliations to the corresponding GAAP financial measures, provide a more complete understanding of factors and trends affecting our business than could be obtained absent this disclosure. We strongly encourage investors to review our financial information in its entirety and not to rely on a single financial measure. ​ We present EBITDAre in accordance with guidelines established by the National Association of Real Estate Investment Trusts (“Nareit”), as defined in its September 2017 white paper “Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate.” We believe EBITDAre is a useful performance measure to help investors evaluate and compare the results of our operations from period to period in comparison to our peers. Nareit defines EBITDAre as net income (calculated in accordance with GAAP) plus interest expense, income tax expense, depreciation and amortization, gains or losses on the disposition of depreciated property (including gains or losses on change in control), impairment write-downs of depreciated property and of investments in unconsolidated affiliates caused by a decrease in the value of depreciated property in the affiliate, and adjustments to reflect the entity’s share of EBITDAre of unconsolidated affiliates. ​ We make additional adjustments to EBITDAre when evaluating our performance because we believe that the exclusion of certain additional items described below provides useful information to investors regarding our operating performance, and that the presentation of Adjusted EBITDAre, when combined with the primary GAAP presentation of net income, is beneficial to an investor’s complete understanding of our operating performance. In addition, we use both EBITDAre and Adjusted EBITDAre as measures in determining the value of hotel acquisitions and dispositions. ​ We adjust EBITDAre for the following items, which may occur in any period, and refer to this measure as Adjusted EBITDAre: ​ ● Amortization of deferred stock compensation: we exclude the noncash expense incurred with the amortization of deferred stock compensation as this expense is based on historical stock prices at the date of grant to our corporate employees and does not reflect the underlying performance of our hotels. ​ ● Amortization of contract intangibles: we exclude the noncash amortization of any favorable or unfavorable contract intangibles recorded in conjunction with our hotel acquisitions. We exclude the noncash amortization of contract intangibles because it is based on historical cost accounting and is of lesser significance in evaluating our actual performance for the current period. ​ ​ 43 Table of Contents ● Amortization of right-of-use assets and obligations: we exclude the amortization of our right-of-use assets and related lease obligations, as these expenses are based on historical cost accounting and do not reflect the actual rent amounts due to the respective lessors or the underlying performance of our hotels. ​ ​ ● Undepreciated asset transactions: we exclude the effect of gains and losses on the disposition of undepreciated assets because we believe that including them in Adjusted EBITDAre is not consistent with reflecting the ongoing performance of our assets. ​ ​ ● Gains or losses from debt transactions: we exclude the effect of finance charges and premiums associated with the extinguishment of debt, including the acceleration of deferred financing costs from the original issuance of the debt being redeemed or retired because, like interest expense, their removal helps investors evaluate and compare the results of our operations from period to period by removing the impact of our capital structure. ​ ​ ● Cumulative effect of a change in accounting principle: from time to time, the Financial Accounting Standards Board (“FASB”) promulgates new accounting standards that require the consolidated statement of operations to reflect the cumulative effect of a change in accounting principle. We exclude these one-time adjustments, which include the accounting impact from prior periods, because they do not reflect our actual performance for that period. ​ ​ ● Other adjustments: we exclude other adjustments that we believe are outside the ordinary course of business because we do not believe these costs reflect our actual performance for the period and/or the ongoing operations of our hotels. Such items may include: lawsuit settlement costs; the write-off of development costs associated with abandoned projects; property-level restructuring, severance, and management transition costs; pre-opening costs associated with extensive renovation projects; debt resolution costs; lease terminations; property insurance restoration proceeds or uninsured losses; and other nonrecurring identified adjustments. ​ ​ The following table reconciles our net income to EBITDAre and Adjusted EBITDAre for the years ended December 31, 2025 and 2024 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​   ​ ​ ​ 2025   ​ ​ ​ 2024 Net income ​ $ 24,568 ​ $ 43,262 Depreciation and amortization ​ ​ 134,508 ​ 124,507 Interest expense ​ ​ 52,965 ​ 50,125 Income tax provision (benefit), net ​ ​ 216 ​ (1,100) Loss (gain) on sale of assets, net ​ ​ 8,751 ​ (457) EBITDAre ​ ​ 221,008 ​ 216,337 ​ ​ ​ ​ ​ ​ ​ Amortization of deferred stock compensation ​ ​ 8,699 ​ 10,456 Amortization of right-of-use assets and obligations ​ ​ (625) ​ (425) Loss (gain) on extinguishment of debt ​ ​ 180 ​ (59) Gain on insurance recoveries, net ​ ​ (1,050) ​ ​ (430) Pre-opening costs ​ ​ 6,471 ​ ​ 2,633 Property-level legal settlement costs ​ ​ — ​ ​ 1,182 Management transition costs ​ ​ 1,869 ​ — Adjustments to EBITDAre, net ​ ​ 15,544 ​ 13,357 Adjusted EBITDAre ​ $ 236,552 ​ $ 229,694 ​ Adjusted EBITDAre increased $6.9 million, or 3.0%, in 2025 as compared to 2024 primarily due to the following: ● Adjusted EBITDAre at the Comparable Portfolio increased $7.5 million, or 3.5%, in 2025 as compared to 2024, primarily due to the changes in the Comparable Portfolio’s revenues and expenses included in the discussion above regarding the operating results for 2025. ● Adjusted EBITDAre at the Two Renovation Hotels increased $6.0 million, or 299.4%, in 2025 as compared to 2024 primarily due to the changes in the Two Renovation Hotels’ revenues and expenses included in the discussion above regarding the operating results for 2025. ● The Hyatt Regency San Antonio Riverwalk recorded Adjusted EBITDAre of $16.7 million and $14.8 million in 2025 and 2024, respectively. ● The Hilton New Orleans St. Charles recorded Adjusted EBITDAre of $3.0 million and $4.6 million in 2025 and 2024, respectively. 44 Table of Contents ● Corporate-level Adjusted EBITDAre decreased $6.9 million in 2025 as compared to 2024 primarily due to a $6.9 million decrease in interest income and a $2.5 million increase in corporate overhead expense, partially offset by a $3.9 million settlement related to certain construction-related claims at Oceans Edge Resort & Marina. ​ We believe that the presentation of FFO attributable to common stockholders provides useful information to investors regarding our operating performance because it is a measure of our operations without regard to specified noncash items such as real estate depreciation and amortization, any real estate impairment loss and any gain or loss on sale of real estate assets, all of which are based on historical cost accounting and may be of lesser significance in evaluating our current performance. Our presentation of FFO attributable to common stockholders conforms to the Nareit definition of “FFO applicable to common shares.” Our presentation may not be comparable to FFO reported by other REITs that do not define the terms in accordance with the current Nareit definition, or that interpret the current Nareit definition differently than we do. ​ We also present Adjusted FFO attributable to common stockholders when evaluating our operating performance because we believe that the exclusion of certain additional items described below provides useful supplemental information to investors regarding our ongoing operating performance and may facilitate comparisons of operating performance between periods and our peer companies. We adjust FFO attributable to common stockholders for the following items, which may occur in any period, and refer to this measure as Adjusted FFO attributable to common stockholders: ● Amortization of deferred stock compensation: we exclude the noncash expense incurred with the amortization of deferred stock compensation as this expense is based on historical stock prices at the date of grant to our corporate employees and does not reflect the underlying performance of our hotels. ● Amortization of contract intangibles: we exclude the noncash amortization of any favorable or unfavorable contract intangibles recorded in conjunction with our hotel acquisitions. We exclude the noncash amortization of contract intangibles because it is based on historical cost accounting and is of lesser significance in evaluating our actual performance for the current period. ​ ● Real estate amortization of right-of-use assets and obligations: we exclude the amortization of our real estate right-of-use assets and related lease obligations (with the exception of our corporate operating lease) as these expenses are based on historical cost accounting and do not reflect the actual rent amounts due to the respective lessors or the underlying performance of our hotels. ​ ​ ● Gains or losses from debt transactions: we exclude the effect of finance charges and premiums associated with the extinguishment of debt, including the acceleration of deferred financing costs from the original issuance of the debt being redeemed or retired, as well as the noncash interest on our derivatives. We believe that these items are not reflective of our ongoing finance costs. ​ ​ ● Cumulative effect of a change in accounting principle: from time to time, the FASB promulgates new accounting standards that require the consolidated statement of operations to reflect the cumulative effect of a change in accounting principle. We exclude these one-time adjustments, which include the accounting impact from prior periods, because they do not reflect our actual performance for that period. ​ ​ ● Other adjustments: we exclude other adjustments that we believe are outside the ordinary course of business because we do not believe these costs reflect our actual performance for that period and/or the ongoing operations of our hotels. Such items may include: lawsuit settlement costs; the write-off of development costs associated with abandoned projects; changes to deferred tax assets, liabilities or valuation allowances; property-level restructuring, severance, and management transition costs; pre-opening costs associated with extensive renovation projects; debt resolution costs; gains or losses on the redemptions or repurchases of preferred stock; lease terminations; property insurance restoration proceeds or uninsured losses; income tax benefits or provisions associated with the application of net operating loss carryforwards, uncertain tax positions or with the sale of assets; and other nonrecurring identified adjustments. ​ ​ 45 Table of Contents The following table reconciles our net income to FFO attributable to common stockholders and Adjusted FFO attributable to common stockholders for the years ended December 31, 2025 and 2024 (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​   ​ ​ ​ 2025   ​ ​ ​ 2024 Net income ​ $ 24,568 ​ $ 43,262 Preferred stock dividends, net of gain on repurchases ​ (16,110) ​ (15,228) Real estate depreciation and amortization ​ 133,112 ​ 123,096 Loss (gain) on sale of assets, net ​ 8,751 ​ (457) FFO attributable to common stockholders ​ 150,321 ​ 150,673 ​ ​ ​ ​ ​ ​ ​ Amortization of deferred stock compensation ​ ​ 8,699 ​ ​ 10,456 Real estate amortization of right-of-use assets and obligations ​ (527) ​ (517) Amortization of contract intangibles, net ​ ​ 1,259 ​ ​ 1,147 Noncash interest on derivatives, net ​ 878 ​ (540) Loss (gain) on extinguishment of debt ​ 180 ​ (59) Gain on insurance recoveries, net ​ ​ (1,050) ​ ​ (430) Pre-opening costs ​ ​ 6,471 ​ ​ 2,633 Property-level legal settlement costs ​ ​ — ​ ​ 1,182 Management transition costs ​ ​ 1,869 ​ ​ — Gain on preferred stock repurchases, net ​ ​ (254) ​ ​ — Prior year income tax benefit, net ​ ​ — ​ ​ (1,530) Adjustments to FFO attributable to common stockholders, net ​ 17,525 ​ 12,342 Adjusted FFO attributable to common stockholders ​ $ 167,846 ​ $ 163,015 ​ Adjusted FFO attributable to common stockholders increased $4.8 million, or 3.0%, in 2025 as compared to 2024 primarily due to the same reasons noted in the discussion above regarding Adjusted EBITDAre. ​ Liquidity and Capital Resources ​ During the periods presented, our sources of cash included our operating activities and working capital, as well as proceeds from a hotel disposition, our credit facility and term loans, key money, and property insurance. Our primary uses of cash were for capital expenditures for hotels and other assets, the acquisition of a hotel and land adjacent to one of our hotels, operating expenses, repurchases of our preferred and common stock, repayments of our credit facility and notes payable, payments of deferred financing costs, and dividends and distributions on our preferred and common stock. We cannot be certain that the sources of funds we have relied on in the past will be available in the future. ​ Operating activities. Our net cash provided by or used in operating activities fluctuates primarily as a result of changes in the net cash generated by our hotels, offset by the cash paid for corporate expenses. Our net cash provided by or used in operating activities may also be affected by changes in our portfolio resulting from hotel acquisitions, dispositions or renovations. Net cash provided by operating activities was $181.8 million in 2025 as compared to $170.4 million in 2024. The net increase in cash provided by operating activities in 2025 as compared to 2024 was primarily due to additional operating cash provided by the increase in travel demand benefiting our hotels, the acquisition of the Hyatt Regency San Antonio Riverwalk, and the post-renovation ramp-ups of Marriott Long Beach Downtown and Andaz Miami Beach. These increases were partially offset by decreases in interest income resulting from our lower cash balances and lower interest rates, along with increases in corporate-level expenses. ​ Investing activities. Our net cash provided by or used in investing activities fluctuates primarily as a result of acquisitions, dispositions, and renovations of hotels and other assets. Net cash used in investing activities in 2025 and 2024 was as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2025 ​ 2024 Proceeds from sales of assets ​ $ 46,348 ​ $ — Acquisitions of hotel properties and other assets ​ (1,269) ​ (229,330) Acquisition-related key money proceeds ​ ​ 8,000 ​ ​ — Proceeds from property insurance ​ 1,165 ​ 430 Renovations and additions to hotel properties and other assets ​ (103,046) ​ (157,378) Net cash used in investing activities ​ $ (48,802) ​ $ (386,278) ​ 46 Table of Contents In 2025, we invested $103.0 million for renovations and additions to our portfolio and other assets, and we purchased land adjacent to the Oceans Edge Resort & Marina for $1.3 million. These cash outflows were partially offset by $46.3 million of proceeds received from the sale of the Hilton New Orleans St. Charles, $8.0 million in key money received from the manager of two of our hotels pursuant to the hotels’ management agreements, and $1.2 million in property insurance proceeds received related to claims at Hyatt Regency San Francisco, The Westin Washington, DC Downtown, and Hilton San Diego Bayfront. ​ In 2024, we paid $229.3 million to acquire the Hyatt Regency San Antonio Riverwalk, including closing costs and prorations, and we invested $157.4 million for renovations and additions to our portfolio and other assets. These cash outflows were slightly offset by $0.4 million in property insurance proceeds received related to claims at the Hilton San Diego Bayfront and at Wailea Beach Resort. ​ Financing activities. Our net cash provided by or used in financing activities fluctuates primarily as a result of our dividends and distributions paid, the issuance and repurchase of common and restricted stock, the issuance and repayment of debt, including draws on our credit facility and term loans, and the issuance, repurchase, and redemption of other forms of capital, including preferred equity. Net cash used in financing activities in 2025 and 2024 was as follows (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 2025 ​ 2024 Repurchases of common stock ​ $ (102,591) ​ $ (27,238) Repurchases of common stock for employee tax obligations ​ ​ (4,278) ​ ​ (4,160) Repurchases of preferred stock ​ ​ (1,272) ​ ​ — Proceeds from credit facility ​ ​ 50,000 ​ ​ — Payments on credit facility ​ ​ (50,000) ​ ​ — Proceeds from notes payable ​ ​ 149,600 ​ ​ 100,000 Payments on notes payable ​ ​ (64,600) ​ ​ (74,050) Payments of deferred financing costs ​ ​ (17,981) ​ ​ (1,105) Dividends and distributions paid ​ ​ (86,393) ​ ​ (90,966) Net cash used in financing activities ​ $ (127,515) ​ $ (97,519) ​ During 2025, we paid $102.6 million to repurchase 11,589,722 shares of our common stock and $1.3 million to repurchase 54,097 shares and 9,027 shares of our Series H preferred stock and Series I preferred stock, respectively. We also paid $4.3 million to repurchase common stock to satisfy the tax obligations in connection with the vesting of restricted common stock issued to employees, and $86.4 million in dividends and distributions to our preferred and common stockholders. In September 2025, we entered into the Amended Credit Agreement and received $149.6 million from additional borrowing on our term loans and repaid $64.6 million to lenders as a result of modifications to their commitment levels under the Amended Credit Agreement. We used a portion of the proceeds received to repay the $50.0 million we drew down on our revolving credit facility in April 2025 and July 2025. During 2025, we also paid $18.0 million in deferred financing costs related to the extension of the maturity of our previous Term Loan 3 and the execution of the Amended Credit Agreement. ​ During 2024, we paid $27.2 million to repurchase 2,764,837 shares of our common stock, $4.2 million to repurchase common stock to satisfy the tax obligations in connection with the vesting of restricted common stock issued to employees, $74.1 million in principal payments on our loan secured by the JW Marriott New Orleans, including $2.0 million in scheduled principal payments and $72.1 million to repay the loan, and $91.0 million in dividends and distributions to our preferred and common stockholders. We also entered into Term Loan 4, receiving $100.0 million in proceeds and paying $1.1 million in related deferred financing costs. We utilized the proceeds received from Term Loan 4 to repay the loan secured by the JW Marriott New Orleans. ​ Future. We expect our primary sources of cash will continue to be our operating activities, working capital, borrowing under our credit facility, additional issuances of debt, dispositions of hotel properties, and proceeds from offerings of common and preferred stock. However, there can be no assurance that our future asset sales, debt issuances or equity offerings will be successfully completed. As a result of potential increases in inflation rates and interest rates, as well as possible recessionary periods in the future, certain sources of capital may not be as readily available to us as they have in the past or may only be available at higher costs. ​ We expect our primary uses of cash to be for operating expenses, capital investments in our hotels, repayment of principal on our debt and credit facility, interest expense, repurchases of our common and preferred stock, distributions on our common stock, dividends on our preferred stock, and acquisitions of hotels or interests in hotels. ​ While inflation began to decrease in 2024 and remained relatively stable through 2025, the uncertainty surrounding certain international economic and political relationships, including political disputes and unfavorable perceptions of travel to the U.S., volatility in transportation fuel costs, increases in air and ground travel costs, decreases in airline capacity, government shutdowns, 47 Table of Contents and the imposition of tariffs affecting commodity costs, has had a negative effect on our operations. Prior to the tariffs announced in 2025, we experienced increases in wages, employee-related benefits, food costs, commodity costs, including those used to renovate or reposition our hotels, property taxes, liability insurance, utilities, and borrowing costs. The imposition of tariffs could exacerbate existing cost pressures and create additional inflationary pressures that could further impact our results of operations. The ability of our hotel operators to adjust rates has historically mitigated the impact of increased operating costs on our financial position and results of operations. ​ Cash Balance. As of December 31, 2025, our unrestricted cash balance was $109.2 million. We believe that our current unrestricted cash balance and our ability to draw the $500.0 million capacity available for borrowing under the unsecured revolving credit facility will enable us to successfully manage our Company. ​ Debt. As of December 31, 2025, we had $930.0 million of debt, $185.7 million of cash and cash equivalents, including restricted cash, and total assets of $3.0 billion. We believe that by maintaining appropriate debt levels, staggering maturity dates, and maintaining a highly flexible structure, we will have lower capital costs than more highly leveraged companies, or companies with limited flexibility due to restrictive covenants. ​ In January 2025, we entered into an interest rate swap on Term Loan 4, which was effective January 31, 2025, expires November 7, 2026, and fixes the SOFR rate at 4.02%. ​ In April 2025, we exercised our option to extend the maturity date of the previous Term Loan 3 from May 2025 to May 2026. In addition, in April 2025, we drew down $27.0 million on our credit facility and used the proceeds for general corporate purposes. ​ In July 2025, we drew down $23.0 million on our credit facility and used the proceeds for general corporate purposes. ​ In September 2025, we entered into the Amended Credit Agreement, which expanded our unsecured debt borrowing capacity and extended the maturity of our term loans. The Amended Credit Agreement continues to provide for a $500.0 million revolving credit facility and increases the aggregate amount of our term loan facilities from $675.0 million (on four existing term loans) to $850.0 million (on three new term loans). The following includes the details of the Amended Credit Agreement: ● The maturity of the revolving credit facility was extended from July 2026, with two six-month options to extend, to September 2029, with two six-month options to extend; ● The new term loan facilities include a $275.0 million term loan, of which $185.0 million was funded in September 2025 and the remaining $90.0 million was available as a one-time delayed draw at any time through February 2026 (“New Term Loan 1”), a $275.0 million term loan funded in September 2025 (“New Term Loan 2”), and a $300.0 million term loan funded in September 2025 ("New Term Loan 3”) (together the “New Term Loans”); ● We utilized the $760.0 million in proceeds received from the New Term Loans to consolidate our previous four term loans into the three New Term Loans and to repay the $50.0 million outstanding on our revolving credit facility; ● The revolving credit facility and the New Term Loans bear interest pursuant to a leverage-based pricing grid ranging from 1.40% to 2.25% and 1.35% to 2.20%, respectively, over the applicable term SOFR; ● New Term Loan 1 has an initial maturity of January 2029, with two twelve-month extension options (subject to customary fees), which would result in an extended maturity of January 2031; ● New Term Loan 2 has an initial maturity of January 2030, with one twelve-month extension option (subject to customary fees), which would result in an extended maturity of January 2031; ● New Term Loan 3 has a maturity of January 2031, with no available extension options; and ● The New Term Loans are available to be prepaid at any time with no prepayment penalty. ​ In August 2025, we entered into an interest rate swap with a notional amount of $65.0 million and an effective date of January 10, 2026, which we will use to fix a portion of the interest rate on the New Term Loan 1 delayed draw. The swap agreement expires January 10, 2028 and fixes the SOFR rate at 3.206%. In addition, in September 2025, we entered into an interest rate swap with a notional amount of $210.0 million and an effective date of September 9, 2025, which fixes the SOFR rate at 3.226% on the current $185.0 million balance of New Term Loan 1 and $25.0 million of New Term Loan 3. The swap agreement expires on September 9, 2028. ​ In January 2026, we drew down the $90.0 million available under the New Term Loan 1 delayed draw and used the proceeds to repay the $65.0 million Series A Senior Notes at their scheduled maturity in January 2026 and for general corporate purposes. 48 Table of Contents ​ As of December 31, 2025, 70.4% of our outstanding debt had fixed interest rates or had been swapped to fixed interest rates, including our unsecured corporate-level New Term Loan 1, New Term Loan 2, and $25.0 million of New Term Loan 3, which totaled $485.0 million, and our two unsecured corporate-level senior notes, which total $170.0 million. ​ Our floating rate debt as of December 31, 2025 included $275.0 million of our unsecured corporate-level New Term Loan 3. ​ We may in the future seek to obtain mortgages on one or more of our 14 unencumbered hotels (subject to certain stipulations under our unsecured term loans and senior notes), all of which were held by subsidiaries whose interests were pledged to our credit facilities as of December 31, 2025. Should we obtain secured financing on any or all of our unencumbered hotels, the amount of capital available through our credit facilities or future unsecured borrowings may be reduced. ​ Contractual Obligations ​ The following table summarizes our payment obligations and commitments (in thousands): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Payment due by period ​ ​ ​ ​ ​ Less Than ​ 1 to 3 ​ 3 to 5 ​ More than ​ ​ ​ Total ​ 1 year ​ years ​ years ​ 5 years Debt (1) ​ $ 955,000 ​ $ — ​ $ 105,000 ​ $ — ​ $ 850,000 ​ Interest obligations on debt (1) (2) ​ ​ 241,219 ​ ​ 46,383 ​ ​ 96,915 ​ ​ 91,328 ​ ​ 6,593 ​ Operating lease obligations, including imputed interest (3) ​ ​ 8,732 ​ ​ 2,563 ​ ​ 4,705 ​ ​ 503 ​ ​ 961 ​ Construction commitments ​ ​ 38,926 ​ ​ 38,926 ​ ​ — ​ — ​ — ​ Total ​ $ 1,243,877 ​ $ 87,872 ​ $ 206,620 ​ $ 91,831 ​ $ 857,554 ​ (1) Debt and interest obligations on debt assume we will exercise all available extension options on our revolving credit facility and New Term Loans, upon payment of applicable fees and the satisfaction of certain customary conditions. Debt and interest obligations on debt include the $90.0 million we received in January 2026 from the New Term Loan 1 delayed draw and the $65.0 million repayment of the Series A Senior Notes. (2) Interest is calculated based on the January 2026 loan balances and variable rates, as applicable, and includes the effect of our interest rate derivatives. (3) Operating lease obligations include the lease on our current corporate headquarters and the sublease on our former corporate headquarters. In addition, operating lease obligations include a ground lease that expires in 2071 and requires a reassessment of rent payments due after 2025, agreed upon by both us and the lessor. The reassessment was not finalized as of December 31, 2025; therefore, no amounts are included in the above table for this ground lease. ​ Capital Expenditures and Reserve Funds ​ We believe we maintain each of our hotels in good repair and condition and in general conformity with applicable franchise and management agreements, ground lease, laws, and regulations. Our capital expenditures primarily relate to the ongoing maintenance of our hotels and are budgeted in the reserve accounts described in the following paragraph. We also incur capital expenditures for cyclical renovations, hotel repositionings, and development. We invested $103.0 million in our portfolio and other assets during 2025 and $157.4 million in 2024. As of December 31, 2025, we have contractual construction commitments totaling $38.9 million for ongoing renovations. If we renovate additional hotels in the future, our capital expenditures will likely increase. ​ With respect to our hotels that are operated under management or franchise agreements with certain hotel brands, we are obligated to maintain an FF&E reserve account for future planned and emergency-related capital expenditures at these hotels. The amount funded into each of these reserve accounts is determined pursuant to the management and franchise agreements for each of the respective hotels, ranging between 3.0% and 5.5% of the respective hotel’s applicable annual revenue. As of December 31, 2025, our balance sheet includes restricted cash of $76.4 million, which was held in FF&E reserve accounts for future capital expenditures at the majority of our hotels. According to certain management agreements, reserve funds are to be held by the managers in restricted cash accounts, and we are not required to spend the entire amount in such reserve accounts each year. ​ Inflation ​ Inflation affects our expenses, including, without limitation, by increasing such costs as wages, employee-related benefits, food costs, commodity costs, including those used to renovate or reposition our hotels, property taxes, property and liability insurance, utilities, and borrowing costs. We rely on our hotel operators to adjust room rates and pricing for hotel services to reflect the effects of 49 Table of Contents inflation. However, previously contracted rates, competitive pressures or other factors may limit the ability of our operators to respond to inflation. As a result, our expenses may increase at higher rates than our revenue and our expenses may not decrease if revenue decreases. ​ Seasonality and Volatility ​ As is typical of the lodging industry, we experience seasonality in our business. Demand at certain of our hotels is affected by seasonal business patterns that can cause quarterly fluctuations in our revenues. ​ Quarterly revenue also may be adversely affected by renovations and repositionings, our managers’ effectiveness in generating business and by events beyond our control, such as economic and business conditions, including a U.S. recession or increased inflation, trade conflicts and tariffs, changes impacting global travel, regional or global economic slowdowns, any flu or disease-related outbreak that impacts travel or the ability to travel, weather patterns, the adverse effects of climate change, the threat of terrorism, terrorist events, civil unrest, government shutdowns, events that reduce the capacity or availability of air travel, increased competition from other hotels in our markets, new hotel supply or alternative lodging options, and unexpected changes in commercial or leisure travel. ​ Critical Accounting Estimates ​ Our discussion and analysis of our financial condition and results of operations is based upon our consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue, and expenses and related disclosure of contingent assets and liabilities. ​ We evaluate our estimates on an ongoing basis. We base our estimates on historical experience, information that is currently available to us, and on various other assumptions that we believe are reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions. We believe the following critical accounting policies affect the most significant judgments and estimates used in the preparation of our consolidated financial statements. ​ ● Impairment of investments in hotel properties. Impairment losses are recorded on investments in hotel properties to be held and used by us whenever events or changes in circumstances indicate that the carrying value of the assets may not be recoverable. Factors we consider when assessing whether impairment indicators exist include, but are not limited to, hotel disposition strategy and hold period, a significant decline in operating results not related to renovations or repositionings, significant changes in the manner in which the Company uses the asset, physical damage to the property due to unforeseen events such as natural disasters, and other market and economic conditions. ​ Recoverability of assets that will continue to be used is measured by comparing the carrying amount of the asset to the related total future undiscounted net cash flows. If an asset’s carrying value is not recoverable through those cash flows, the asset is considered to be impaired. The impairment is measured by the difference between the asset’s carrying amount and its fair value. We perform a fair value assessment using valuation techniques such as discounted cash flows and comparable sales transactions in the market to estimate the fair value of the hotel and, if appropriate and available, current estimated net sales proceeds from pending offers. The recoverability assessment includes subjective assumptions such as determining the discount rate, terminal capitalization rate, the estimated growth of revenues and expenses, revenue per available room and margins, specific market and economic conditions, the estimated holding period, as well as the probability assigned to each future cash flow scenario. ​ ● Income taxes. To qualify as a REIT, we must meet a number of organizational and operational requirements, including a requirement that we currently distribute at least 90% of our REIT taxable income (determined without regard to the deduction for dividends paid and excluding net capital gains) to our stockholders. As a REIT, we generally will not be subject to federal corporate income tax on that portion of our taxable income that is currently distributed to stockholders. We are subject to certain state and local taxes on our income and property, and to federal income and excise taxes on our undistributed taxable income. In addition, our wholly owned TRS, which leases our hotels from the Operating Partnership, is subject to federal and state income taxes. We account for income taxes using the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to the differences between the financial statement carrying amounts of existing assets and liabilities and their respective income tax bases, and for net operating loss, capital loss and tax credit carryforwards. The deferred tax assets and liabilities are measured using the enacted income tax rates in effect for the year in which those temporary differences are expected to be realized or settled. The effect on the deferred tax assets and liabilities from a change in tax rates is recognized in earnings in the period when the new rate is enacted. However, deferred tax assets are recognized only to the extent that it is more likely than not that they will be realized based on consideration of all available evidence, 50 Table of Contents including the future reversals of existing taxable temporary differences, future projected taxable income and tax planning strategies. Valuation allowances are provided if, based upon the weight of the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. ​ We review any uncertain tax positions and, if necessary, we will record the expected future tax consequences of uncertain tax positions in the consolidated financial statements. Tax positions not deemed to meet the “more-likely-than-not” threshold are recorded as a tax benefit or expense in the current year. We are required to analyze all open tax years, as defined by the statute of limitations, for all major jurisdictions, which includes federal and certain states. ​ New Accounting Standards and Accounting Changes ​ See Note 2 to the accompanying consolidated financial statements for additional information related to recently issued accounting pronouncements. ​ ​