Xenia Hotels & Resorts, Inc. (NYSE:XHR) Q2 2020 Earnings Conference Call July 30, 2020 1:00 PM ET Company Participants Lisa Ramey - Vice President, Finance Marcel Verbaas - Chairman & Chief Executive Officer Barry Bloom - President & Chief Operating Officer Atish Shah - Chief Financial Officer Conference Call Participants Bill Crow - Raymond James Michael Bellisario - Baird Aryeh Klein - BMO Tyler Batory - Janney Capital Markets Austin Wurschmidt - KeyBanc Bryan Maher - B. Riley FBR Thomas Allen - Morgan S ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ____________________________ (Mark One) ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period ended ______ to ______ Commission file number 001-36594 ___________________________ Xenia Hotels & Resorts, Inc. (Exact Name of Registrant as Specified in Its Charter) _______________________ 200 S. Orange Avenue Suite 2700 , Orlando , Florida 32801 (Address of Principal Ex ...

Grand Bohemian Hotel Charleston Royal Palms Resort & Spa Andaz Savannah and and the latest of the many of the production of the first of Hyatt Centric Key West Resort & Spa Kimpton RiverPlace Hotel Hyatt Regency Scottsdale Resort & Spa Andaz Napa Investor Presentation June 2020 TELS Forward-Looking Statements This presentation has been prepared by Xenia Hotels & Resorts, Inc. (the "Company" or "Xenia") solely for informational purposes. This presentation contains, and our responses to various questions from ...

Xenia Hotels & Resorts, Inc. (NYSE:XHR) Q1 2020 Results Conference Call May 11, 2020 1:00 PM ET Company Participants Lisa Ramey - VP, Finance Marcel Verbaas - Chairman and CEO Barry Bloom - President and COO Atish Shah - CFO Conference Call Participants Thomas Allen - Morgan Stanley Austin Wurschmidt - KeyBanc Michael Bellisario - Baird Ari Klein - BMO Capital Tyler Batory - Janney Capital Markets David Katz - Jefferies Matt Boone - B. Riley FBR Bill Crow - Raymond James Operator Good day, and welcome to th ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ____________________________ (Mark One) ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2020 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period ended ______ to ______ Commission file number 001-36594 ___________________________ Xenia Hotels & Resorts, Inc. (Exact Name of Regist ...

Park Hyatt Aviara Resort, Golf Club & Spa Royal Palms Resort & Spa Hyatt Regency Grand Cypress rs and the state the production of the many of The Ritz-Carlton, Pentagon City The Ritz-Carlton, Denver Hyatt Regency Scottsdale Resort & Spa Fairmont Pittsburgh Investor Presentation February 2020 HOTELS & Forward-Looking Statements This presentation has been prepared by Xenia Hotels & Resorts, Inc. (the "Company" or "Xenia") solely for informational purposes. This presentation contains, and our responses to vari ...

Xenia Hotels & Resorts, Inc. (NYSE:XHR) Q4 2019 Earnings Conference Call February 25, 2020 11:00 AM ET Company Participants Lisa Ramey - Vice President of Finance Marcel Verbaas - Chairman & Chief Executive Officer Barry Bloom - President & Chief Operating Officer Atish Shah - Executive Vice President & Chief Financial Officer Conference Call Participants David Katz - Jefferies Austin Wurschmidt - KeyBanc Capital Markets Ari Klein - BMO Capital Markets Bryan Maher - B. Riley FBR Michael Bellisario - Baird T ...

[PART I](index=6&type=section&id=Part%20I) [Special Note Regarding Forward-Looking Statements](index=3&type=section&id=Special%20Note%20Regarding%20Forward-Looking%20Statements) Forward-looking statements in the report are subject to known and unknown risks and uncertainties that could cause actual results to differ materially - Forward-looking statements are based on estimates and assumptions, and actual results may differ materially due to various risks and uncertainties[11](index=11&type=chunk) - Key risks include business and financial risks inherent to real estate and lodging, seasonal/cyclical volatility, adverse changes in specialized industries (energy, technology, tourism), macroeconomic factors, declines in occupancy and ADR, changes in competitive environment, and events beyond control (war, cyber-attacks, natural disasters)[12](index=12&type=chunk) - Additional risks cover inability to operate properties directly, reliance on third-party managers, brand standard maintenance, loss of key personnel, acquisition/disposition challenges, renovation impacts, capital access, fixed costs, debt servicing, regulatory compliance, uninsured losses, and changes in distribution channels[15](index=15&type=chunk) [Market and Industry Data](index=5&type=section&id=Market%20and%20Industry%20Data) Market and industry data, primarily from STR Inc., are believed reliable but not guaranteed for accuracy or completeness, with forecasts lacking assurance of achievement - Market and industry data are sourced from independent publications, government publications, and other independent sources, primarily STR Inc[17](index=17&type=chunk) - The accuracy and completeness of the information are not guaranteed, and forecasts are based on industry surveys and experience without assurance of achievement[17](index=17&type=chunk) [Trademarks, Service Marks, and Tradenames](index=5&type=section&id=Trademarks%2C%20Service%20Marks%2C%20and%20Tradenames) Xenia Hotels & Resorts® and related marks are proprietary to Xenia, while other trademarks belong to their respective owners, with usage ceasing upon agreement termination - Xenia Hotels & Resorts® and related marks are proprietary to Xenia; other trademarks belong to their respective owners (e.g., Marriott International, Inc., Hyatt Corporation, Kimpton Hotel & Restaurant Group LLC, Fairmont Hotels & Resorts, Loews Hotels, Inc, and Hilton Worldwide Inc.)[19](index=19&type=chunk) - Termination of management or franchise agreements requires the cessation of brand mark use and removal of all associated signs and materials at the hotel, at Xenia's expense[19](index=19&type=chunk) [Disclaimer](index=5&type=section&id=Disclaimer) Brand Companies disclaim responsibility for Xenia's shares or report content and may engage in competitive business ventures - Brand Companies (e.g., Marriott, Hyatt) are not issuers of Xenia's shares and are not responsible for the creation or content of this Annual Report[21](index=21&type=chunk) - Brand Companies do not have an exclusive relationship with Xenia and may pursue other business ventures, including those competitive with Xenia's properties[21](index=21&type=chunk) [Certain Defined Terms](index=5&type=section&id=Certain%20Defined%20Terms) Key terms such as ADR, occupancy, RevPAR, Top 25 U.S. lodging markets, and hotel classifications are defined for clarity throughout the report - Key terms defined include ADR (hotel rooms revenue / total rooms sold), occupancy (total rooms sold / total rooms available), and RevPAR (hotel rooms revenue / room nights available)[24](index=24&type=chunk) - Definitions also cover 'Top 25 U.S. lodging markets' and hotel classifications like 'upper upscale,' 'luxury,' and 'independent' as defined by STR, along with major brand companies such as Fairmont, Hilton, Hyatt, Kimpton, Loews, and Marriott[24](index=24&type=chunk) [Item 1. Business](index=6&type=section&id=Item%201.%20Business) Xenia Hotels & Resorts, Inc. is a self-advised, self-administered Maryland REIT investing in luxury and upper upscale hotels, owning 39 properties with 11,245 rooms as of December 31, 2019 - Xenia Hotels & Resorts, Inc. is a Maryland corporation and a REIT, investing primarily in uniquely positioned luxury and upper upscale hotels and resorts in the Top 25 U.S. lodging markets and key leisure destinations[25](index=25&type=chunk) - As of December 31, 2019, the Company owned **39 lodging properties** with a total of **11,245 rooms**[28](index=28&type=chunk) - To maintain REIT status, Xenia cannot operate its hotels directly; instead, its TRS leases properties and engages third-party independent operators[27](index=27&type=chunk) [General](index=6&type=section&id=General) [Business Objectives and Growth Strategies](index=7&type=section&id=Business%20Objectives%20and%20Growth%20Strategies) [Our Financing and Capital Strategy](index=8&type=section&id=Our%20Financing%20and%20Capital%20Strategy) [Competition](index=9&type=section&id=Competition) [Seasonality](index=9&type=section&id=Seasonality) [Cyclicality](index=9&type=section&id=Cyclicality) [Regulations](index=9&type=section&id=Regulations) [Our Tax Status](index=10&type=section&id=Our%20Tax%20Status) [Restrictions on Ownership and Transfer of Our Stock](index=11&type=section&id=Restrictions%20on%20Ownership%20and%20Transfer%20of%20Our%20Stock) [Insurance](index=11&type=section&id=Insurance) [Employees](index=11&type=section&id=Employees) [Our History](index=11&type=section&id=Our%20History) [Where You Can Find More Information](index=12&type=section&id=Where%20You%20Can%20Find%20More%20Information) [Item 1A. Risk Factors](index=13&type=section&id=Item%201A.%20Risk%20Factors) Various risks could materially and adversely affect Xenia's business, financial condition, results of operations, and cash flow, including industry, separation, debt, REIT status, and corporate structure factors - The lodging industry is highly cyclical and sensitive to economic conditions, with luxury and upper upscale hotels potentially more susceptible to revenue decreases during downturns[69](index=69&type=chunk) - Reliance on third-party hotel management companies poses risks, including potential conflicts of interest, limited operational control, and adverse effects if managers fail to perform or maintain brand standards[80](index=80&type=chunk)[81](index=81&type=chunk)[88](index=88&type=chunk) - Geographic concentration of hotels (e.g., Texas, California, Florida) exposes the company to regional economic downturns, increased competition, and adverse acts of nature[92](index=92&type=chunk)[93](index=93&type=chunk) - Failure to maintain REIT qualification would result in corporate taxation, significantly reducing funds available for distributions and adversely affecting stock value[168](index=168&type=chunk)[169](index=169&type=chunk) - High leverage, restrictive debt covenants, and interest rate fluctuations (including LIBOR transition risks) could limit financial flexibility, increase costs, and impact distributions[140](index=140&type=chunk)[151](index=151&type=chunk)[156](index=156&type=chunk) [Risks Related to Our Business and Industry](index=13&type=section&id=Risks%20Related%20to%20Our%20Business%20and%20Industry) [Risks Related to Our Relationship with InvenTrust and the Separation](index=25&type=section&id=Risks%20Related%20to%20Our%20Relationship%20with%20InvenTrust%20and%20the%20Separation) [Risks Related to Debt Financing](index=26&type=section&id=Risks%20Related%20to%20Debt%20Financing) [Risks Related to Our Status as REIT](index=31&type=section&id=Risks%20Related%20to%20Our%20Status%20as%20REIT) [Risks Related to Ownership of Our Common Stock and our Corporate Structure](index=36&type=section&id=Risks%20Related%20to%20Ownership%20of%20Our%20Common%20Stock%20and%20our%20Corporate%20Structure) [Item 1B. Unresolved Staff Comments](index=40&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) No unresolved staff comments from the SEC - There are no unresolved staff comments[225](index=225&type=chunk) [Item 2. Properties](index=41&type=section&id=Item%202.%20Properties) Xenia's hotel portfolio overview includes brand affiliations, property listings, and summaries of key management, franchise, and ground lease agreements crucial for REIT compliance - As of December 31, 2019, Xenia owned **39 operating hotels** across 16 states, with **88% of rooms** under Marriott, Hyatt, or Kimpton brands[228](index=228&type=chunk)[229](index=229&type=chunk) Hotel Brand Affiliations (as of December 31, 2019) | Brand | Number of Hotels | Number of Rooms | Percentage of Total Rooms | | :----------------------- | :--------------- | :-------------- | :------------------------ | | Marriott | 17 | 5,340 | 47.5% | | Hyatt | 10 | 3,394 | 30.2% | | Kimpton | 7 | 1,124 | 10.0% | | Fairmont | 2 | 730 | 6.5% | | Loews | 1 | 285 | 2.5% | | Hilton - Waldorf Astoria | 1 | 127 | 1.1% | | Total branded | 38 | 11,000 | 97.8% | | Independent | 1 | 245 | 2.2% | | Total portfolio | 39 | 11,245 | 100% | - To maintain REIT status, Xenia leases its hotels to TRS lessees, which then engage independent third-party management companies. Approximately **82% of hotels are brand-managed**, and **15% are franchised**[234](index=234&type=chunk) - Management agreements for brand-managed hotels typically have **20-30 year initial terms** (average **11 years remaining**, **27 years with renewals**) and a two-tiered fee structure (base and incentive fees)[238](index=238&type=chunk)[239](index=239&type=chunk) - Five hotels are subject to ground leases, with an average remaining term of approximately **46 years** (**74 years with renewal options**)[104](index=104&type=chunk) [Hotel Properties](index=41&type=section&id=Hotel%20Properties) [Our Brand Af iliations](index=41&type=section&id=Our%20Brand%20Af%20iliations) [Our Hotels](index=42&type=section&id=Our%20Hotels) [Our Principal Agreements](index=43&type=section&id=Our%20Principal%20Agreements) [Item 3. Legal Proceedings](index=47&type=section&id=Item%203.%20Legal%20Proceedings) Xenia is involved in various legal proceedings and claims, mostly covered by insurance, with management believing no material adverse effect on financial position or operations - Xenia is involved in various legal proceedings and claims, including tort, general liability, workers' compensation, and employee claims[265](index=265&type=chunk) - Most occurrences are covered by insurance, and management believes the ultimate outcome will not materially affect financial position, results of operations, or liquidity[265](index=265&type=chunk) [Item 4. Mine Safety Disclosures](index=47&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) Mine Safety Disclosures are not applicable to the company - Mine Safety Disclosures are not applicable to Xenia Hotels & Resorts, Inc[266](index=266&type=chunk) [PART II](index=48&type=section&id=Part%20II) [Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=48&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) Xenia's common stock market, shareholder details, dividend policy, and share repurchase program are discussed, including NYSE listing and REIT distribution requirements - Xenia's common stock trades on the NYSE under the symbol **'XHR'** since February 4, 2015[269](index=269&type=chunk) - As of February 21, 2020, there were **13,226 holders of record** of common stock and **12 holders of Operating Partnership Units**[270](index=270&type=chunk) - To maintain REIT qualification, Xenia must distribute at least **90% of its REIT taxable income** annually[272](index=272&type=chunk) Common Stock Dividends Paid (2019 & 2018) | Year | Dividend per Share/Unit (Quarterly) | Total Annual Dividend per Share/Unit | | :--- | :---------------------------------- | :----------------------------------- | | 2019 | $0.275 | $1.10 | | 2018 | $0.275 | $1.10 | - Dividends paid in 2019 and 2018 were **100% taxable as ordinary income**[278](index=278&type=chunk)[279](index=279&type=chunk) - A share repurchase program of up to **$175 million** was authorized, with approximately **$96.9 million remaining** as of December 31, 2019. No shares were purchased in 2018 or 2019[285](index=285&type=chunk)[286](index=286&type=chunk) [Market Information](index=48&type=section&id=Market%20Information) [Shareholder Information](index=48&type=section&id=Shareholder%20Information) [Dividends](index=48&type=section&id=Dividends) [Share Performance Graph](index=49&type=section&id=Share%20Performance%20Graph) [Recent Sales of Unregistered Securities](index=50&type=section&id=Recent%20Sales%20of%20Unregistered%20Securities) [Issuer Purchases of Equity Securities](index=50&type=section&id=Issuer%20Purchases%20of%20Equity%20Securities) [Item 6. Selected Financial Data](index=51&type=section&id=Item%206.%20Selected%20Financial%20Data) A summary of Xenia's consolidated historical financial and operating data for 2015-2019 is presented, including income statement, balance sheet, and non-GAAP metrics Consolidated Selected Financial Data (2015-2019, in thousands) | Metric | 2019 | 2018 | 2017 | 2016 | 2015 | | :------------------------------------------------- | :--------- | :--------- | :--------- | :--------- | :--------- | | **Revenues:** | | | | | | | Rooms revenues | $686,485 | $659,697 | $623,331 | $653,944 | $663,224 | | Food and beverage revenues | $382,031 | $335,723 | $266,977 | $246,479 | $259,036 | | Other revenues | $80,571 | $62,787 | $54,969 | $49,737 | $53,884 | | **Total revenues** | **$1,149,087** | **$1,058,207** | **$945,277** | **$950,160** | **$976,144** | | **Total expenses** | **$1,037,606** | **$926,383** | **$841,660** | **$838,657** | **$872,072** | | **Operating income** | **$111,481** | **$131,824** | **$103,617** | **$111,503** | **$104,072** | | Net income attributable to common stockholders | $55,400 | $193,688 | $98,862 | $85,855 | $88,746 | | Basic and diluted earnings per share | $0.49 | $1.75 | $0.92 | $0.79 | $0.79 | | **Selected Balance Sheet Data:** | | | | | | | Net investment properties | $2,926,370 | $2,875,146 | $2,690,855 | $2,443,589 | $2,414,799 | | Cash and cash equivalents | $110,841 | $91,413 | $71,884 | $216,054 | $122,154 | | Total assets | $3,263,006 | $3,170,087 | $3,115,308 | $2,860,345 | $3,005,944 | | Total debt, net | $1,293,054 | $1,155,088 | $1,322,593 | $1,077,132 | $1,094,536 | | Total equity | $1,775,158 | $1,852,705 | $1,645,086 | $1,651,567 | $1,743,358 | | **Other Financial Data:** | | | | | | | Adjusted EBITDAre attributable to common stock and unit holders | $302,118 | $299,813 | $270,286 | $287,328 | $293,010 | | Adjusted FFO attributable to common stock and unit holders | $250,598 | $245,399 | $219,978 | $238,241 | $241,635 | [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=53&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Xenia's financial condition and operating results for 2019 and 2018, covering business overview, market outlook, portfolio changes, key performance indicators, and liquidity - Xenia is a self-advised and self-administered REIT focused on luxury and upper upscale hotels in top U.S. lodging markets and leisure destinations[295](index=295&type=chunk) - The U.S. lodging industry saw modest RevPAR growth of **0.9%** in 2019, driven by a **1.0% increase in ADR**, with supply growth matching demand at **2.0%**[299](index=299&type=chunk) - In 2019, Xenia completed **$93 million** in portfolio renovations and acquired the **600-room Hyatt Regency Portland**, while disposing of two hotels (Marriott Chicago at Medical District/UIC and Marriott Griffin Gate Resort & Spa)[301](index=301&type=chunk)[305](index=305&type=chunk) Key Operating Performance Indicators (2019 vs. 2018) | Metric | 2019 | 2018 | Change | | :-------------------- | :----- | :----- | :----- | | Occupancy | 76.0% | 75.8% | 20 bps | | ADR | $221.59 | $214.51 | 3.3% | | RevPAR | $168.43 | $162.64 | 3.6% | | Hotel operating income | $376,230 | $368,445 | 2.1% | Total Revenues (2019 vs. 2018, in thousands) | Revenue Type | 2019 | 2018 | Increase | % Change | | :-------------------- | :--------- | :--------- | :--------- | :--------- | | Rooms revenues | $686,485 | $659,697 | $26,788 | 4.1% | | Food and beverage revenues | $382,031 | $335,723 | $46,308 | 13.8% | | Other revenues | $80,571 | $62,787 | $17,784 | 28.3% | | **Total revenues** | **$1,149,087** | **$1,058,207** | **$90,880** | **8.6%** | Adjusted EBITDAre and Adjusted FFO (2019 vs. 2018, in thousands) | Metric | 2019 | 2018 | % Change | | :------------------------------------------------- | :--------- | :--------- | :--------- | | Adjusted EBITDAre attributable to common stock and unit holders | $302,118 | $299,813 | 0.8% | | Adjusted FFO attributable to common stock and unit holders | $250,598 | $245,399 | 2.1% | - Net income decreased **71.2%** in 2019 compared to 2018, primarily due to differences in gains/losses on asset sales and impairment charges[325](index=325&type=chunk) Debt Outstanding (as of December 31, 2019, in thousands) | Debt Type | Balance Outstanding | | :------------------------------------------ | :------------------ | | Mortgage Loans | $564,017 | | Unsecured Term Loan $175M | $175,000 | | Unsecured Term Loan $125M | $125,000 | | Unsecured Term Loan $150M | $150,000 | | Unsecured Term Loan $125M | $125,000 | | Senior Unsecured Revolving Credit Facility | $160,000 | | Loan discounts and unamortized deferred financing costs, net | $(5,963) | | **Total Debt, net** | **$1,293,054** | | Weighted average interest rate | 3.72% | | Weighted average maturity (secured mortgage loans) | 5.1 years | | Weighted average maturity (unsecured term loans and revolving credit facility) | 3.0 years | [Overview](index=53&type=section&id=Overview) [Basis of Presentation](index=53&type=section&id=Basis%20of%20Presentation) [Market Outlook](index=53&type=section&id=Market%20Outlook) [Significant Events](index=54&type=section&id=Significant%20Events) [Our Customers](index=54&type=section&id=Our%20Customers) [Our Revenues and Expenses](index=55&type=section&id=Our%20Revenues%20and%20Expenses) [Factors that May Affect Results of Operations](index=56&type=section&id=Factors%20that%20May%20Affect%20Results%20of%20Operations) [Key Indicators of Operating Performance](index=57&type=section&id=Key%20Indicators%20of%20Operating%20Performance) [Critical Accounting Policies and Estimates](index=57&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) [Results of Operations](index=58&type=section&id=Results%20of%20Operations) [Non-GAAP Financial Measures](index=65&type=section&id=Non-GAAP%20Financial%20Measures) [Liquidity and Capital Resources](index=69&type=section&id=Liquidity%20and%20Capital%20Resources) [Item 7A. Quantitative and Qualitative Disclosures About Market Risk](index=74&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Xenia's market risk exposure, primarily from interest rate changes on variable-rate debt, is managed through hedges, with a 1% rate change impacting annual earnings by approximately $3.8 million - Xenia is exposed to market risk from changes in interest rates on variable-rate debt and the cost of new fixed-rate debt[433](index=433&type=chunk) - A **1% increase or decrease** in variable interest rates would impact future earnings and cash flows by approximately **$3.8 million per annum** as of December 31, 2019 (compared to **$1.8 million** in 2018)[433](index=433&type=chunk) - The company uses interest rate swaps to hedge interest rate risk, which are subject to credit risk (counterparty failure) and market risk (adverse effect from interest rate changes)[437](index=437&type=chunk) Maturing Debt and Weighted Average Interest Rates (as of December 31, 2019, in thousands) | Year | Fixed Rate Debt | Variable Rate Debt | Senior Unsecured Revolving Credit Facility | Total | Weighted Average Interest Rate (Fixed) | Weighted Average Interest Rate (Variable) | Weighted Average Interest Rate (Revolving) | | :--- | :-------------- | :----------------- | :----------------------------------------- | :---------- | :------------------------------------- | :---------------------------------------- | :----------------------------------------- | | 2020 | $4,365 | — | — | $4,365 | 4.45% | — | — | | 2021 | $180,135 | $270 | — | $180,405 | 2.94% | 3.66% | — | | 2022 | $181,840 | $1,080 | — | $182,920 | 3.60% | 3.66% | — | | 2023 | $60,788 | $151,080 | $160,000 | $371,868 | 4.16% | 3.32% | 3.41% | | 2024 | $217,969 | $63,570 | — | $281,539 | 3.61% | 3.69% | — | | Thereafter | $277,920 | — | — | $277,920 | 4.66% | — | — | | **Total** | **$923,017** | **$216,000** | **$160,000** | **$1,299,017** | **3.83%** | **3.43%** | **3.41%** | [Interest Rate Sensitivity](index=74&type=section&id=Interest%20Rate%20Sensitivity) [Item 8. Financial Statements and Supplementary Data](index=75&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) Consolidated financial statements and supplementary data are located in the Index to Financial Statements on page F-1 - Financial statements and supplementary data are located in the Index to Financial Statements on page F-1[440](index=440&type=chunk) [Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=75&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) No changes in or disagreements with accountants on accounting and financial disclosure - There have been no changes in or disagreements with accountants on accounting and financial disclosure[441](index=441&type=chunk) [Item 9A. Controls and Procedures](index=75&type=section&id=Item%209A.%20Controls%20and%20Procedures) Xenia's disclosure controls and internal control over financial reporting were effective as of December 31, 2019, with an unqualified opinion from KPMG LLP - Disclosure controls and procedures were evaluated as **effective** as of December 31, 2019, ensuring timely and accurate reporting of required information[442](index=442&type=chunk)[443](index=443&type=chunk) - Management concluded that internal control over financial reporting was **effective** as of December 31, 2019, based on the COSO framework[445](index=445&type=chunk) - KPMG LLP issued an **unqualified opinion** on the effectiveness of the company's internal control over financial reporting[446](index=446&type=chunk) - No material changes in internal control over financial reporting occurred during the fourth quarter of 2019[447](index=447&type=chunk) [Evaluation of Disclosure on Controls and Procedures](index=75&type=section&id=Evaluation%20of%20Disclosure%20on%20Controls%20and%20Procedures) [Management's Report on Internal Control Over Financial Reporting](index=76&type=section&id=Management%27s%20Report%20on%20Internal%20Control%20Over%20Financial%20Reporting) [Independent Registered Public Accounting Firm's Report on Internal Control Over Financial Reporting](index=76&type=section&id=Independent%20Registered%20Public%20Accounting%20Firm%27s%20Report%20on%20Internal%20Control%20Over%20Financial%20Reporting) [Changes in Internal Control over Financial Reporting](index=76&type=section&id=Changes%20in%20Internal%20Control%20over%20Financial%20Reporting) [Item 9B. Other Information](index=76&type=section&id=Item%209B.%20Other%20Information) Additional U.S. federal income tax consequences from the TCJA of 2017 and the First Amendment to the Bylaws, permitting stockholder amendments, are detailed - The Tax Cuts and Jobs Act (TCJA) of 2017 significantly changed U.S. federal income tax laws, reducing the corporate tax rate to **21%** and the highest individual rate to **37%**[449](index=449&type=chunk) - The First Amendment to the Bylaws, effective February 19, 2020, permits stockholders to amend the Bylaws by affirmative vote of a **majority of outstanding common stock**, provided proposals are properly submitted[451](index=451&type=chunk)[452](index=452&type=chunk) [Additional Material U.S. Federal Income Tax Consequences](index=76&type=section&id=Additional%20Material%20U.S.%20Federal%20Income%20Tax%20Consequences) [First Amendment to our Second Amended and Restated Bylaws](index=76&type=section&id=First%20Amendment%20to%20our%20Second%20Amended%20and%20Restated%20Bylaws) [PART III](index=77&type=section&id=Part%20III) [Item 10. Directors, Executive Officers and Corporate Governance](index=77&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Information on Directors, Executive Officers, and Corporate Governance is incorporated by reference from the 2020 Annual Meeting of Stockholders Proxy Statement - Information on Directors, Executive Officers, and Corporate Governance is incorporated by reference from the 2020 Annual Meeting of Stockholders Proxy Statement[453](index=453&type=chunk) [Item 11. Executive Compensation](index=77&type=section&id=Item%2011.%20Executive%20Compensation) Information on Executive Compensation is incorporated by reference from the 2020 Annual Meeting of Stockholders Proxy Statement - Information on Executive Compensation is incorporated by reference from the 2020 Annual Meeting of Stockholders Proxy Statement[454](index=454&type=chunk) [Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=77&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Details on securities authorized for issuance under Xenia's 2015 Incentive Award Plan, including outstanding options and available securities, are provided Securities Authorized for Issuance Under Equity Compensation Plan (as of December 31, 2019) | Plan Category | Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights | Weighted Average Price of Outstanding Options, Warrants and Rights | Number of Securities Remaining Available for Future Issuance | | :------------------------------------------------- | :---------------------------------------------------------------- | :--------------------------------------------------------------- | :----------------------------------------------------------- | | Xenia Hotels & Resorts, Inc., XHR Holding, Inc. and XHR LP 2015 Incentive Award Plan | 1,931,073 | $9.84 | 2,608,071 | | Equity compensation plans not approved by security holders | — | — | — | [Securities Authorized for Issuance Under Equity Compensation Plan](index=77&type=section&id=Securities%20Authorized%20for%20Issuance%20Under%20Equity%20Compensation%20Plan) [Item 13. Certain Relationships and Related Transactions](index=77&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions) Information on Certain Relationships and Related Transactions is incorporated by reference from the 2020 Annual Meeting of Stockholders Proxy Statement - Information on Certain Relationships and Related Transactions is incorporated by reference from the 2020 Annual Meeting of Stockholders Proxy Statement[458](index=458&type=chunk) [Item 14. Principal Accounting Fees and Services](index=78&type=section&id=Item%2014.%20Principal%20Accounting%20Fees%20and%20Services) Information on Principal Accounting Fees and Services is incorporated by reference from the 2020 Annual Meeting of Stockholders Proxy Statement - Information on Principal Accounting Fees and Services is incorporated by reference from the 2020 Annual Meeting of Stockholders Proxy Statement[460](index=460&type=chunk) [PART IV](index=79&type=section&id=Part%20IV) [Item 15. Exhibits and Financial Statement Schedules](index=79&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) Financial statements, schedules, and exhibits filed as part of the Annual Report on Form 10-K are listed, including the Independent Auditor's Report and Consolidated Financial Statements - The section includes the Report of Independent Registered Public Accounting Firm and Consolidated Financial Statements[462](index=462&type=chunk)[465](index=465&type=chunk) - Schedule III - Real Estate and Accumulated Depreciation for Xenia Hotels & Resorts, Inc. is filed herein[462](index=462&type=chunk) - A comprehensive list of exhibits, including agreements, bylaws, and certifications, is provided, with some incorporated by reference and others filed herewith[463](index=463&type=chunk)[466](index=466&type=chunk)[468](index=468&type=chunk) [Item 16. Summary of Form 10-K Disclosures](index=82&type=section&id=Item%2016.%20Summary%20of%20Form%2010-K%20Disclosures) No summary of Form 10-K disclosures is provided - No summary of Form 10-K disclosures is provided[469](index=469&type=chunk)

Xenia Hotels & Resorts, Inc. (NYSE:XHR) Q3 2019 Earnings Conference Call October 31, 2019 1:00 PM ET Company Participants Lisa Ramey - VP, Finance Marcel Verbaas - Chairman & CEO Barry Bloom - President & COO Atish Shah - CFO Conference Call Participants David Katz - Jefferies Austin Wurschmidt - KeyBanc Capital Markets Ari Klein - BMO Capital Markets Michael Bellisario - Baird Thomas Allen - Morgan Stanley Bryan Maher - B. Riley FBR Bill Crow - Raymond James Dory Kesten - Wells Fargo Securities Operator Go ...

PART I. FINANCIAL INFORMATION [Item 1. Financial Statements (unaudited)](index=4&type=section&id=Item%201.%20Financial%20Statements) Presents the unaudited condensed consolidated financial statements and accompanying notes detailing key accounting policies [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) **Condensed Consolidated Balance Sheets (in thousands):** | Metric | September 30, 2019 (Unaudited) | December 31, 2018 (Audited) | | :--------------------------------------- | :----------------------------- | :-------------------------- | | Total Assets | $3,158,982 | $3,170,087 | | Total Liabilities | $1,372,784 | $1,317,382 | | Total Equity | $1,786,198 | $1,852,705 | | Net Investment Properties | $2,805,673 | $2,875,146 | | Cash and Cash Equivalents | $116,483 | $91,413 | | Restricted Cash and Escrows | $84,484 | $70,195 | [Condensed Consolidated Statements of Operations and Comprehensive Income](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income) **Net Income Attributable to Common Stockholders (in thousands):** | Period | 2019 | 2018 | | :-------------------------------- | :----- | :----- | | Three Months Ended Sep 30 | $10,315 | $9,244 | | Nine Months Ended Sep 30 | $39,791 | $93,695 | **Total Revenues (in thousands):** | Period | 2019 | 2018 | | :-------------------------------- | :------- | :------- | | Three Months Ended Sep 30 | $268,931 | $240,989 | | Nine Months Ended Sep 30 | $866,903 | $782,544 | **Basic and Diluted Earnings Per Share:** | Period | 2019 | 2018 | | :-------------------------------- | :--- | :--- | | Three Months Ended Sep 30 | $0.09 | $0.08 | | Nine Months Ended Sep 30 | $0.35 | $0.85 | - Gain on sale of investment properties for the nine months ended September 30, 2019, was **$0**, a significant decrease from **$42,294 thousand** in the same period of 2018[13](index=13&type=chunk) [Condensed Consolidated Statements of Changes in Equity (Three Months)](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Equity%20(Three%20Months)) - Total Company stockholders' equity as of September 30, 2019, was **$1,752,094 thousand**[18](index=18&type=chunk) - Net income attributable to common stockholders for the three months ended September 30, 2019, was **$10,315 thousand**[18](index=18&type=chunk) - Dividends for common shares/units for the three months ended September 30, 2019, totaled **$(31,059) thousand**[18](index=18&type=chunk) - Unrealized loss on interest rate derivative instruments for the three months ended September 30, 2019, was **$(2,096) thousand**[18](index=18&type=chunk) [Condensed Consolidated Statements of Changes in Equity (Nine Months)](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Equity%20(Nine%20Months)) - Total Company stockholders' equity as of September 30, 2019, was **$1,752,094 thousand**[21](index=21&type=chunk) - Net income attributable to common stockholders for the nine months ended September 30, 2019, was **$39,791 thousand**[21](index=21&type=chunk) - Dividends for common shares/units for the nine months ended September 30, 2019, totaled **$(93,139) thousand**[21](index=21&type=chunk) - Unrealized loss on interest rate derivative instruments for the nine months ended September 30, 2019, was **$(16,152) thousand**[21](index=21&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=11&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) **Cash Flow Summary (Nine Months Ended Sep 30, in thousands):** | Activity | 2019 | 2018 | | :------------------------------------ | :------- | :------- | | Net cash provided by operating activities | $205,059 | $196,760 | | Net cash used in investing activities | $(62,794) | $(29,662) | | Net cash used in financing activities | $(102,906) | $(149,476) | | Net increase in cash and cash equivalents and restricted cash | $39,359 | $17,622 | | Cash and cash equivalents and restricted cash, at end of period | $200,967 | $148,026 | [Notes to the Condensed Consolidated Financial Statements](index=14&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) [Note 1. Organization](index=14&type=section&id=Note%201.%20Organization) - Xenia Hotels & Resorts, Inc is a Maryland corporation operating as a REIT, primarily investing in luxury and upper upscale hotels and resorts in the U.S[29](index=29&type=chunk) - As of September 30, 2019, the Company owned **96.7%** of the common limited partnership units of XHR LP, its Operating Partnership[30](index=30&type=chunk) - The Company wholly-owned **40 lodging properties** as of September 30, 2019[32](index=32&type=chunk) [Note 2. Summary of Significant Accounting Policies](index=14&type=section&id=Note%202.%20Summary%20of%20Significant%20Accounting%20Policies) - The unaudited interim condensed consolidated financial statements are prepared in accordance with U.S. GAAP and SEC rules[33](index=33&type=chunk) - The Company adopted **Topic 842, Leases**, on January 1, 2019, using a modified retrospective transition approach[46](index=46&type=chunk) - The Company has a geographical concentration of revenues from hotels in the **Orlando, Florida market**, exceeding **10% of total revenues** for the nine months ended September 30, 2019 and 2018[37](index=37&type=chunk) [Note 3. Revenues](index=21&type=section&id=Note%203.%20Revenues) **Total Revenue by Primary Geographical Markets (Nine Months Ended Sep 30, 2019, in thousands):** | Primary Markets | Revenue | | :-------------- | :------ | | Orlando, FL | $88,494 | | Houston, TX | $75,178 | | Phoenix, AZ | $73,062 | | San Diego, CA | $63,215 | | Dallas, TX | $57,063 | **Total Revenue by Primary Geographical Markets (Nine Months Ended Sep 30, 2018, in thousands):** | Primary Markets | Revenue | | :-------------- | :------ | | Orlando, FL | $87,924 | | Phoenix, AZ | $70,889 | | Houston, TX | $69,725 | | Washington, DC-MD-VA | $55,856 | | San Francisco/San Mateo, CA | $54,839 | [Note 4. Investment Properties](index=22&type=section&id=Note%204.%20Investment%20Properties) - **No hotels were acquired or sold** during the three and nine months ended September 30, 2019[67](index=67&type=chunk)[71](index=71&type=chunk) - In 2018, the Company acquired The Ritz-Carlton, Denver for **$99.5 million** and Fairmont Pittsburgh for **$30.6 million**[67](index=67&type=chunk)[68](index=68&type=chunk) **Disposition Details (Nine Months Ended Sep 30, 2018, in thousands):** | Property | Date | Rooms | Gross Sale Price | Net Proceeds | Gain on Sale | | :---------------------- | :------- | :---- | :--------------- | :----------- | :----------- | | Aston Waikiki Beach Hotel | 03/2018 | 645 | $200,000 | $196,920 | $42,430 | [Note 5. Debt](index=24&type=section&id=Note%205.%20Debt) **Total Debt Outstanding (in thousands):** | Date | Balance Outstanding | | :---------------- | :------------------ | | September 30, 2019 | $1,155,000 | | December 31, 2018 | $1,162,000 | - Weighted average interest rate decreased from **3.82%** at December 31, 2018, to **3.74%** at September 30, 2019[77](index=77&type=chunk) **Scheduled Principal Payments and Debt Maturities (as of Sep 30, 2019, in thousands):** | Year | Total Debt | | :--------- | :--------- | | 2019 | $912 | | 2020 | $19,218 | | 2021 | $180,401 | | 2022 | $182,915 | | 2023 | $211,863 | | Thereafter | $559,568 | | **Total Debt** | **$1,154,877** | - The Company was **in compliance with all debt covenants** as of September 30, 2019[77](index=77&type=chunk) - The Company repriced its **$125 million** unsecured term loan in September 2019, reducing borrowing costs by **35 to 55 basis points**[80](index=80&type=chunk) [Note 6. Derivatives](index=27&type=section&id=Note%206.%20Derivatives) - The Company primarily uses **interest rate swaps** as cash flow hedges for variable-rate debt[81](index=81&type=chunk) **Derivative Financial Instruments (as of Sep 30, 2019, in thousands):** | Metric | Amount | | :-------------------- | :------- | | Total Notional Amounts | $689,250 | | Estimated Fair Value | $(7,149) | - Unrealized loss on interest rate derivative instruments for the nine months ended September 30, 2019, was **$(16,703) thousand**[83](index=83&type=chunk) - Approximately **$1.3 million** is expected to be reclassified from accumulated other comprehensive loss to interest expense in the next 12 months[83](index=83&type=chunk) [Note 7. Fair Value Measurements](index=29&type=section&id=Note%207.%20Fair%20Value%20Measurements) - The Company uses a fair value hierarchy (Level 1, 2, 3) to prioritize inputs for fair value measurements[84](index=84&type=chunk)[85](index=85&type=chunk) - Interest rate swap fair values are classified within **Level 2** of the fair value hierarchy[87](index=87&type=chunk) - An impairment charge of **$14.8 million** was recorded for Marriott Chicago at Medical District/UIC during the nine months ended September 30, 2019, due to a projected decline in operating profits[88](index=88&type=chunk)[89](index=89&type=chunk) - The estimated fair value of total debt, net of discounts, was **$1,177,021 thousand** as of September 30, 2019[91](index=91&type=chunk) [Note 8. Income Taxes](index=31&type=section&id=Note%208.%20Income%20Taxes) **Income Tax Benefit (Expense) (in thousands):** | Period | 2019 | 2018 | | :-------------------------------- | :------- | :------- | | Three Months Ended Sep 30 | $2,442 | $1,985 | | Nine Months Ended Sep 30 | $(9,844) | $(8,325) | - Estimated federal and state statutory combined tax rate was **31.41%** for 2019 and **31.24%** for 2018[92](index=92&type=chunk)[93](index=93&type=chunk) [Note 9. Stockholders' Equity](index=31&type=section&id=Note%209.%20Stockholders'%20Equity) - **No shares were sold** under the At-the-Market (ATM) program during the three and nine months ended September 30, 2019[94](index=94&type=chunk) - As of September 30, 2019, **$62.6 million** was available for sale under the ATM Agreement[94](index=94&type=chunk) - **No shares were purchased** under the Repurchase Program during the three and nine months ended September 30, 2019[95](index=95&type=chunk) - As of September 30, 2019, approximately **$96.9 million** remained under the share repurchase authorization[95](index=95&type=chunk) **Dividends Declared (2019):** | Dividend per Share/Unit | For the Quarter Ended | Record Date | Payable Date | | :---------------------- | :-------------------- | :---------- | :----------- | | $0.275 | March 31, 2019 | March 29, 2019 | April 12, 2019 | | $0.275 | June 30, 2019 | June 28, 2019 | July 12, 2019 | | $0.275 | September 30, 2019 | September 30, 2019 | October 15, 2019 | - As of September 30, 2019, **3,818,925 LTIP partnership units** were outstanding, representing a **3.3%** partnership interest[97](index=97&type=chunk) [Note 10. Earnings Per Share](index=33&type=section&id=Note%2010.%20Earnings%20Per%20Share) **Basic and Diluted Earnings Per Share:** | Period | 2019 | 2018 | | :-------------------------------- | :--- | :--- | | Three Months Ended Sep 30 | $0.09 | $0.08 | | Nine Months Ended Sep 30 | $0.35 | $0.85 | - Weighted average number of common shares (diluted) for the nine months ended September 30, 2019, was **112,918,790**[101](index=101&type=chunk) [Note 11. Share Based Compensation](index=34&type=section&id=Note%2011.%20Share%20Based%20Compensation) - In February 2019, the Company granted **84,944 time-based** and **50,846 performance-based** Restricted Stock Units[102](index=102&type=chunk) - In February 2019, the Company granted **90,273 time-based** and **781,898 performance-based** LTIP Units[104](index=104&type=chunk) - As of September 30, 2019, total unrecognized compensation costs related to unvested awards were **$12.8 million**, expected to be recognized over a weighted-average period of **1.8 years**[112](index=112&type=chunk)[113](index=113&type=chunk) - Share-based compensation expense (net of forfeitures) for the nine months ended September 30, 2019, was approximately **$6.5 million**[112](index=112&type=chunk) [Note 12. Commitments and Contingencies](index=36&type=section&id=Note%2012.%20Commitments%20and%20Contingencies) - Upon adoption of Topic 842, a Right-of-Use (ROU) asset of **$46,503 thousand** and a lease liability of **$27,472 thousand** were recorded as of September 30, 2019[116](index=116&type=chunk) - The weighted average remaining lease term, including reasonably certain extension options, is **30 years**[116](index=116&type=chunk) **Reserve Funds for Furniture, Fixtures and Equipment (in thousands):** | Date | Amount | | :---------------- | :------- | | September 30, 2019 | $72,200 | | December 31, 2018 | $60,600 | - Management believes the ultimate outcome of current legal proceedings will **not have a material adverse effect** on the Company's financial condition[120](index=120&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=39&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Provides management's analysis of financial condition, operational results, liquidity, and key performance indicators [Overview](index=41&type=section&id=Overview%20(MD&A)) - Xenia Hotels & Resorts, Inc is a self-advised and self-administered REIT investing in luxury and upper upscale hotels in the U.S[125](index=125&type=chunk) - As of September 30, 2019, the Company owned **40 hotels**, comprising **11,167 rooms**, across 17 states[125](index=125&type=chunk) [Basis of Presentation](index=41&type=section&id=Basis%20of%20Presentation%20(MD&A)) - The condensed consolidated financial statements include the accounts of the Company, the Operating Partnership, and XHR Holding, with inter-company transactions eliminated[126](index=126&type=chunk) [Our Revenues and Expenses](index=41&type=section&id=Our%20Revenues%20and%20Expenses%20(MD&A)) - Primary revenue sources are **rooms, food and beverage**, and other ancillary hotel services[127](index=127&type=chunk) - Operating costs include rooms, food and beverage, management and franchise fees, and other direct and indirect operating expenses[128](index=128&type=chunk) - Hotels are operated by **independent, third-party management companies**[128](index=128&type=chunk) [Key Indicators of Operating Performance](index=41&type=section&id=Key%20Indicators%20of%20Operating%20Performance%20(MD&A)) - Key performance metrics include **Revenue Per Available Room (RevPAR)**, average daily rate (ADR), occupancy rate, EBITDAre, Adjusted EBITDAre, Funds From Operations (FFO), and Adjusted FFO[129](index=129&type=chunk) [Results of Operations](index=42&type=section&id=Results%20of%20Operations%20(MD&A)) [Overview](index=42&type=section&id=Overview%20(Results%20of%20Operations)) - U.S lodging industry RevPAR growth slowed to **0.7%** for Q3 2019 and **1.0%** for the nine months ended September 30, 2019[131](index=131&type=chunk) **Total Portfolio RevPAR:** | Period | 2019 | 2018 | Change | | :-------------------------------- | :------- | :------- | :----- | | Three Months Ended Sep 30 | $164.25 | $155.88 | +5.4% | | Nine Months Ended Sep 30 | $171.85 | $164.13 | +4.7% | - Net income **increased 14.3%** for Q3 2019 but **decreased 57.1%** for the nine months ended September 30, 2019, primarily due to a prior-year gain on sale and a 2019 impairment charge[134](index=134&type=chunk)[135](index=135&type=chunk) - Hurricane Dorian negatively impacted total revenues by approximately **$1.0 million** for the three and nine months ended September 30, 2019[133](index=133&type=chunk) [Operating Information Comparison](index=44&type=section&id=Operating%20Information%20Comparison) **Total Portfolio Operating Statistics (Three Months Ended Sep 30):** | Metric | 2019 | 2018 | Change | | :------- | :----- | :----- | :------- | | Occupancy | 76.8% | 75.8% | +100 bps | | ADR | $213.94 | $205.65 | +4.0% | | RevPAR | $164.25 | $155.88 | +5.4% | **Total Portfolio Operating Statistics (Nine Months Ended Sep 30):** | Metric | 2019 | 2018 | Change | | :------- | :----- | :----- | :------- | | Occupancy | 77.3% | 76.9% | +36 bps | | ADR | $222.45 | $213.53 | +4.2% | | RevPAR | $171.85 | $164.13 | +4.7% | - Number of properties at September 30 remained at **40** for both 2019 and 2018[138](index=138&type=chunk) [Revenues](index=44&type=section&id=Revenues%20(MD&A)) **Total Revenues (in thousands):** | Period | 2019 | 2018 | Increase | % Change | | :-------------------------------- | :------- | :------- | :------- | :--------- | | Three Months Ended Sep 30 | $268,931 | $240,989 | $27,942 | +11.6% | | Nine Months Ended Sep 30 | $866,903 | $782,544 | $84,359 | +10.8% | **Rooms Revenues (in thousands):** | Period | 2019 | 2018 | Increase | % Change | | :-------------------------------- | :------- | :------- | :------- | :--------- | | Three Months Ended Sep 30 | $168,744 | $156,973 | $11,771 | +7.5% | | Nine Months Ended Sep 30 | $523,912 | $495,378 | $28,534 | +5.8% | **Food and Beverage Revenues (in thousands):** | Period | 2019 | 2018 | Increase | % Change | | :-------------------------------- | :------- | :------- | :------- | :--------- | | Three Months Ended Sep 30 | $79,825 | $69,179 | $10,646 | +15.4% | | Nine Months Ended Sep 30 | $282,685 | $242,014 | $40,671 | +16.8% | **Other Revenues (in thousands):** | Period | 2019 | 2018 | Increase | % Change | | :-------------------------------- | :------- | :------- | :------- | :--------- | | Three Months Ended Sep 30 | $20,362 | $14,837 | $5,525 | +37.2% | | Nine Months Ended Sep 30 | $60,306 | $45,152 | $15,154 | +33.6% | - Rooms revenues for 36-comparable hotels **increased 2.9%** for both the three and nine months ended September 30, 2019, driven by RevPAR increases[144](index=144&type=chunk)[145](index=145&type=chunk) [Hotel Operating Expenses](index=48&type=section&id=Hotel%20Operating%20Expenses%20(MD&A)) **Total Hotel Operating Expenses (in thousands):** | Period | 2019 | 2018 | Increase | % Change | | :-------------------------------- | :------- | :------- | :------- | :--------- | | Three Months Ended Sep 30 | $187,180 | $163,001 | $24,179 | +14.8% | | Nine Months Ended Sep 30 | $580,053 | $506,269 | $73,784 | +14.6% | **Food and Beverage Expenses (in thousands):** | Period | 2019 | 2018 | Increase | % Change | | :-------------------------------- | :------- | :------- | :------- | :--------- | | Three Months Ended Sep 30 | $57,356 | $49,130 | $8,226 | +16.7% | | Nine Months Ended Sep 30 | $184,151 | $155,633 | $28,518 | +18.3% | - Hotel operating expenses for 36-comparable hotels **increased 1.7%** for the three months and **2.0%** for the nine months ended September 30, 2019, attributed to increased total revenues[155](index=155&type=chunk)[159](index=159&type=chunk) [Corporate and Other Expenses](index=50&type=section&id=Corporate%20and%20Other%20Expenses%20(MD&A)) **Total Corporate and Other Expenses (in thousands):** | Period | 2019 | 2018 | Increase / (Decrease) | % Change | | :-------------------------------- | :------- | :------- | :-------------------- | :--------- | | Three Months Ended Sep 30 | $61,487 | $58,747 | $2,740 | +4.7% | | Nine Months Ended Sep 30 | $198,915 | $176,040 | $22,875 | +13.0% | **Real Estate Taxes, Personal Property Taxes and Insurance (in thousands):** | Period | 2019 | 2018 | Increase | % Change | | :-------------------------------- | :------- | :------- | :------- | :--------- | | Three Months Ended Sep 30 | $13,331 | $11,652 | $1,679 | +14.4% | | Nine Months Ended Sep 30 | $38,968 | $35,331 | $3,637 | +10.3% | - An impairment charge of **$14.8 million** was recorded for Marriott Chicago at Medical District/UIC for the nine months ended September 30, 2019[160](index=160&type=chunk)[168](index=168&type=chunk) - Acquisition, terminated transaction and pre-opening expenses increased significantly to **$0.9 million** for the nine months ended September 30, 2019 (from $0.2 million in 2018)[160](index=160&type=chunk)[167](index=167&type=chunk) [Results of Non-Operating Income and Expenses](index=52&type=section&id=Results%20of%20Non-Operating%20Income%20and%20Expenses%20(MD&A)) - **No gain on sale of investment properties** was recognized for the nine months ended September 30, 2019, compared to **$42,294 thousand** in 2018[170](index=170&type=chunk)[171](index=171&type=chunk) **Interest Expense (in thousands):** | Period | 2019 | 2018 | Increase / (Decrease) | % Change | | :-------------------------------- | :-------- | :-------- | :-------------------- | :--------- | | Three Months Ended Sep 30 | $(12,293) | $(11,902) | $391 | +3.3% | | Nine Months Ended Sep 30 | $(37,260) | $(38,672) | $(1,412) | -3.7% | **Income Tax Benefit (Expense) (in thousands):** | Period | 2019 | 2018 | Increase / (Decrease) | % Change | | :-------------------------------- | :-------- | :-------- | :-------------------- | :--------- | | Three Months Ended Sep 30 | $2,442 | $1,985 | $457 | +23.0% | | Nine Months Ended Sep 30 | $(9,844) | $(8,325) | $1,519 | +18.2% | [Liquidity and Capital Resources](index=52&type=section&id=Liquidity%20and%20Capital%20Resources%20(MD&A)) - Short-term liquidity is expected from cash on hand, operations, and borrowings under the senior unsecured revolving credit facility[175](index=175&type=chunk) - Long-term liquidity may be met through additional borrowings, issuance of equity and debt securities, and/or proceeds from hotel sales[178](index=178&type=chunk) - As of September 30, 2019, **$62.6 million** was available for sale under the At-the-Market (ATM) Agreement[179](index=179&type=chunk) - As of September 30, 2019, approximately **$96.9 million** remained under the share repurchase authorization[181](index=181&type=chunk) - Consolidated cash and cash equivalents were **$116.5 million** and restricted cash and escrows were **$84.5 million** as of September 30, 2019[182](index=182&type=chunk) - Total outstanding debt was **$1.2 billion** with a weighted average interest rate of **3.74%** as of September 30, 2019[183](index=183&type=chunk) - The Company is monitoring and evaluating risks related to the transition from **LIBOR** to alternative reference rates[188](index=188&type=chunk)[189](index=189&type=chunk) [Sources and Uses of Cash](index=56&type=section&id=Sources%20and%20Uses%20of%20Cash%20(MD&A)) **Summary Cash Flow Information (Nine Months Ended Sep 30, in thousands):** | Activity | 2019 | 2018 | | :------------------------------------ | :------- | :------- | | Net cash provided by operating activities | $205,059 | $196,760 | | Net cash used in investing activities | $(62,794) | $(29,662) | | Net cash used in financing activities | $(102,906) | $(149,476) | - Cash used in investing activities for the nine months ended September 30, 2019, was primarily attributed to **$62.8 million** in capital improvements[197](index=197&type=chunk) - Cash used in financing activities for the nine months ended September 30, 2019, included **$94.3 million** in dividends and **$90.0 million** in mortgage debt repayment, partially offset by **$85.0 million** from an unsecured term loan drawdown[198](index=198&type=chunk) [Capital Expenditures and Reserve Funds](index=57&type=section&id=Capital%20Expenditures%20and%20Reserve%20Funds%20(MD&A)) **Furniture, Fixtures and Equipment Reserves (in thousands):** | Date | Amount | | :---------------- | :------- | | September 30, 2019 | $72,200 | | December 31, 2018 | $60,600 | - Total capital expenditures for the nine months ended September 30, 2019, were **$63 million**[200](index=200&type=chunk) [Off-Balance Sheet Arrangements](index=57&type=section&id=Off-Balance%20Sheet%20Arrangements%20(MD&A)) - As of September 30, 2019, the Company had **no off-balance sheet arrangements**[201](index=201&type=chunk) [Non-GAAP Financial Measures](index=59&type=section&id=Non-GAAP%20Financial%20Measures%20(MD&A)) **Adjusted EBITDAre Attributable to Common Stock and Unit Holders (in thousands):** | Period | 2019 | 2018 | | :-------------------------------- | :------- | :------- | | Three Months Ended Sep 30 | $62,579 | $60,547 | | Nine Months Ended Sep 30 | $230,123 | $224,127 | **Adjusted FFO Attributable to Common Stock and Unit Holders (in thousands):** | Period | 2019 | 2018 | | :-------------------------------- | :------- | :------- | | Three Months Ended Sep 30 | $53,330 | $51,356 | | Nine Months Ended Sep 30 | $184,848 | $179,459 | - EBITDAre for the nine months ended September 30, 2019, was **$221,792 thousand**, up from $217,296 thousand in 2018[208](index=208&type=chunk) [Critical Accounting Policies and Estimates](index=64&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates%20(MD&A)) - The preparation of financial statements requires management to make estimates and assumptions that affect reported amounts[214](index=214&type=chunk) - All significant accounting policies, including critical ones, are disclosed in the Annual Report on Form 10-K for 2018 and Note 2 of the condensed consolidated financial statements[214](index=214&type=chunk) [Inflation](index=64&type=section&id=Inflation%20(MD&A)) - The Company relies on hotel operators' ability to adjust room rates daily to keep pace with inflation, though competitive pressures may limit this[215](index=215&type=chunk) [Seasonality](index=64&type=section&id=Seasonality%20(MD&A)) - Revenues and operating income are generally expected to be highest during the **second quarter**, followed by the first, third, and fourth quarters, based on the current portfolio[216](index=216&type=chunk) [New Accounting Pronouncements Not Yet Implemented](index=64&type=section&id=New%20Accounting%20Pronouncements%20Not%20Yet%20Implemented%20(MD&A)) - Additional information related to recently issued accounting pronouncements not yet implemented is available in Note 2 to the condensed consolidated financial statements[217](index=217&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=64&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Details the company's exposure to market risks, primarily interest rate fluctuations, and related hedging strategies - The Company is subject to market risk associated with changes in interest rates on variable-rate debt and the price of new fixed-rate debt[218](index=218&type=chunk) - A permanent **1% increase or decrease** in market rates on variable-rate debt would impact future earnings and cash flows by approximately **$2.2 million** per annum (as of September 30, 2019)[218](index=218&type=chunk) - **Interest rate swaps** are used to hedge exposures to changes in interest rates on loans[220](index=220&type=chunk)[221](index=221&type=chunk) **Maturing Debt and Weighted Average Interest Rates (as of Sep 30, 2019, in thousands):** | Debt Type | Total | Weighted Average Interest Rate | | :-------------------------------- | :---------- | :----------------------------- | | Fixed rate debt (mortgage and term loans) | $938,877 | 3.78% | | Variable rate debt (mortgage and term loans) | $216,000 | 3.58% | | **Total** | **$1,154,877** | **3.74%** | [Item 4. Controls and Procedures](index=67&type=section&id=Item%204.%20Controls%20and%20Procedures) Confirms the effectiveness of disclosure controls and procedures and notes no material changes in internal controls - Disclosure controls and procedures were evaluated and deemed **effective** at a reasonable assurance level as of the end of the reporting period[225](index=225&type=chunk) - There has been **no material change** in the Company's internal control over financial reporting during the most recent fiscal quarter[226](index=226&type=chunk) PART II. OTHER INFORMATION [Item 1. Legal Proceedings](index=67&type=section&id=Item%201.%20Legal%20Proceedings) Discloses ongoing legal proceedings and management's assessment of their potential financial impact - The Company is involved in various claims and lawsuits arising in the normal course of business[227](index=227&type=chunk) - Management believes the ultimate outcome of such matters will **not have a material adverse effect** on the Company's financial condition, results of operations, or liquidity[227](index=227&type=chunk) [Item 1A. Risk Factors](index=67&type=section&id=Item%201A.%20Risk%20Factors) States no material changes to risk factors disclosed in the most recent Annual Report on Form 10-K - **No material changes** from the risk factors previously disclosed in the Annual Report on Form 10-K for the fiscal year ended December 31, 2018[228](index=228&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=67&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Reports no unregistered sales of equity securities or use of proceeds for the period - None[229](index=229&type=chunk) [Item 3. Defaults Upon Senior Securities](index=67&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) Confirms no defaults upon senior securities occurred during the reporting period - None[230](index=230&type=chunk) [Item 4. Mine Safety Disclosures](index=67&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) Indicates that mine safety disclosures are not applicable to the company - Not applicable[231](index=231&type=chunk) [Item 5. Other Information](index=67&type=section&id=Item%205.%20Other%20Information) States there is no other material information to report for the period - None[232](index=232&type=chunk) [Item 6. Exhibits](index=68&type=section&id=Item%206.%20Exhibits) Lists all exhibits filed with the report, including certifications and corporate documents - Exhibits include Articles of Restatement, Articles Supplementary, Bylaws, First Amendment to the Fourth Amended and Restated Agreement of Limited Partnership of XHR LP, CEO/CFO Certifications (Sarbanes-Oxley Act), and XBRL documents[233](index=233&type=chunk) [Signatures](index=70&type=section&id=Signatures) Contains the official signatures of the company's principal officers affirming the report - The report is signed by Marcel Verbaas (Chairman and Chief Executive Officer), Atish Shah (Executive Vice President, Chief Financial Officer and Treasurer), and Joseph T Johnson (Senior Vice President and Chief Accounting Officer)[238](index=238&type=chunk)