Exhibit 99.1

For Additional Information:

Bryan Giglia

Senior Vice President – Corporate Finance

Sunstone Hotel Investors, Inc.

(949) 369-4236

SUNSTONE HOTEL INVESTORS REPORTS RESULTS FOR FOURTH QUARTER AND FULL YEAR 2009

Drives strong margin performance through expense controls

Looks to expand portfolio size and quality through disciplined acquisitions

Maintains substantial cash balance

SAN CLEMENTE, CA – February 23, 2010 – Sunstone Hotel Investors, Inc. (the “Company”) (NYSE: SHO) today announced results for the fourth quarter and year ended December 31, 2009.

RevPAR and hotel EBITDA margin information presented reflect the 29 hotel portfolio on a pro forma basis. The 29 hotel portfolio excludes the W San Diego which was conveyed to a receiver in September 2009, the Renaissance Westchester, which was conveyed to a receiver in December 2009, and the Marriott Ontario Airport and eight of the 11 hotels securing the Company’s non-recourse loan with Massachusetts Mutual Life Insurance Company (the “Mass Mutual eight hotels”), which are in the process of being conveyed to receivers.

Fourth Quarter 2009 Operational Results:

 

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Total revenue was $192.6 million.

 

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Pro forma RevPAR was $97.31.

 

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Loss attributable to common stockholders was $133.2 million.

 

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Loss attributable to common stockholders per diluted share was $1.45.

 

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Adjusted EBITDA was $44.8 million.

 

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Adjusted FFO available to common stockholders was $16.2 million.

 

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Adjusted FFO available to common stockholders per diluted share was $0.18.

 

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Pro forma hotel EBITDA margin was 23.8%.

Full Year 2009 Operational Results:

 

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Total revenue was $717.8 million.

 

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Pro forma RevPAR was $102.09.

 

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Loss attributable to common stockholders was $290.8 million.

 

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Loss attributable to common stockholders per diluted share was $4.17.

 

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Adjusted EBITDA was $168.6 million.

 

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Adjusted FFO available to common stockholders was $47.3 million.

 

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Adjusted FFO available to common stockholders per diluted share was $0.68.

 

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Pro forma hotel EBITDA margin was 24.8%.

Art Buser, President and Chief Executive Officer, stated, “2009 was a transformational year for Sunstone. During 2009, to establish a strong foundation for future growth and stability, we took a number of critical steps to improve our liquidity and capital structure. During the year we retooled our hotel and corporate operations, creating a new, more efficient operating model. At the same time, we refined our portfolio by divesting of 14 non-core hotels. We took advantage of a dislocated credit market by opportunistically repurchasing a significant portion of our debt at a discount to par, and we enhanced our balance sheet by eliminating significant near-term

 

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debt maturities while meaningfully increasing our equity base. In spite of the turbulent conditions, we reflect back on the year with a sense of accomplishment and, more importantly, we look ahead with confidence and optimism. With almost $400 million of cash on hand, we have more than double the cash required to repay our debt maturing over the next five years, and we are well positioned for acquisition opportunities.”

SELECTED FINANCIAL DATA

($ in millions, except RevPAR and per share amounts)

(unaudited)

 

		Three Months Ended December 31,											Year Ended December 31,
		2009				2008				% Change			2009				2008				% Change
Total Revenue		$	192.6			$	235.1			(18.1	)%		$	717.8			$	881.5			(18.6	)%
Pro forma RevPAR (1)		$	97.31			$	112.89			(13.8	)%		$	102.09			$	124.85			(18.2	)%
Pro forma hotel EBITDA margin (1)			23.8	%			28.4	%		(460	) bps			24.8	%			29.5	%		(470	) bps
Income available (loss attributable) to common stockholders		$	(133.2	)		$	(12.5	)					$	(290.8	)		$	49.5
Income available (loss attributable) to common stockholders per diluted share		$	(1.45	)		$	(0.26	)					$	(4.17	)		$	0.92
EBITDA		$	(75.9	)		$	50.3						$	(51.3	)		$	304.2
Adjusted EBITDA		$	44.8			$	70.0						$	168.6			$	285.1
FFO available to common stockholders		$	(106.4	)		$	35.6						$	(162.1	)		$	154.7
Adjusted FFO available to common stockholders		$	16.2			$	38.5						$	47.3			$	157.6
FFO available to common stockholders per diluted share (2)		$	(1.15	)		$	0.68						$	(2.32	)		$	2.68
Adjusted FFO available to common stockholders per diluted share (2)		$	0.18			$	0.74						$	0.68			$	2.73

 

(1)

Includes the 29 hotels we owned as of December 31, 2009, excluding the Marriott Ontario Airport and the Mass Mutual eight hotels reclassified as “Operations Held for Non-Sale Disposition” on our balance sheets and statements of operations, and the W San Diego and the Renaissance Westchester reclassified as discontinued operations on our balance sheets and statements of operations.

(2)	Reflects Series C convertible preferred stock on an “as-converted” basis if such treatment is dilutive.

The Company has filed with the Securities and Exchange Commission its Annual Report on Form 10-K for the fiscal year ended December 31, 2009.

Disclosure regarding the non-GAAP financial measures in this release is included on pages 4 and 5. Disclosure regarding the Pro forma hotel EBITDA Margin is included on page 5 of this release. Reconciliations of non-GAAP financial measures to the most comparable GAAP measure for each of the periods presented are included on pages 9, 10 and 11 of this release.

Acquisitions

The Company continues to analyze a variety of investment opportunities aimed at enhancing its portfolio quality and growth prospects. The Company expects to see an increasing number of discount acquisition opportunities over the next three years as the number of hotels facing mortgage maturity defaults – and which consequently may face inadvertent changes in ownership – will continue to increase through the end of 2012. As the lodging industry is in the early stage of this credit-driven acquisitions opportunity, seller price expectations currently remain relatively high. The Company believes that the optimal conditions for discount hotel acquisitions may not fully develop until the volume of maturity defaults begins to crest later in 2010 and into 2011. During the early stage of this opportunity, the Company is exploring alternative structured investments, such as hotel debt or portfolio transactions, which may ultimately lead to opportunities to acquire quality hotel assets at meaningful discounts to warranted value.

Independent Hotel Management RFP

During December 2009, the Company issued a request for proposal (“RFP”) to hotel management companies interested in managing certain of its hotels currently managed by Sunstone Hotel Properties, Inc., a division of Interstate Hotels & Resorts, Inc. The purpose of the RFP is to ensure that the Company has the most highly qualified management companies operating its hotels in order to consistently deliver best in class results. The Company anticipates completing the RFP process during the first half of 2010.

Balance Sheet/Liquidity Update

Ken Cruse, Chief Financial Officer stated, “During 2009 we executed on a comprehensive, well-timed finance plan designed to improve our credit profile and financial flexibility, reduce our debt levels and enhance our corporate liquidity. We accomplished all of these objectives. As a result, we finished the year with a substantial equity base, significant excess cash, and just $180.8 million of debt maturities through 2014. We are very well positioned to capitalize on growth opportunities going forward.”

 

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As of December 31, 2009, the Company had approximately $397.8 million of cash and cash equivalents, including restricted cash of $39.1 million. The Company intends to use a portion of its higher than historical cash balance for acquisition opportunities.

On December 31, 2009, total assets were $2.5 billion, including $1.9 billion of net investments in hotel properties, total debt, excluding debt in the Company’s secured debt restructuring program, was $1.1 billion and stockholders’ equity was $0.9 billion.

The Company continues to negotiate with Mass Mutual regarding the resolution of the 11 hotels comprising the collateral pool for a $246.0 million mortgage loan. The Company has offered to make a partial payment on the mortgage loan in an effort to secure the release of three of the 11 hotels: Courtyard by Marriott Los Angeles, Kahler Inn & Suites Rochester and Marriott Rochester, representing a total of 653 rooms. Accordingly, the Company has included these three hotels in operations held for investment. If the Company and Mass Mutual reach agreement on this proposal, the Company has offered to deed back the remaining eight hotels to Mass Mutual in satisfaction of the debt balance that will remain after the payment of the release price. If the Company and Mass Mutual are unable to reach agreement on this proposal, the Company intends to deed back all 11 hotels in satisfaction of the entire debt balance and without making a cash payment to Mass Mutual. The Company hopes to complete this process in the first quarter, but no assurance can be given that either the partial release or the deed-in-lieu transaction will be consummated, or upon their timing or terms.

On February 23, 2010, the Company elected to terminate its $85.0 million senior secured credit facility. The decision to terminate the credit facility was made in view of the Company’s strong liquidity position and the restrictive terms of the existing credit facility. The credit facility, which had been secured by mortgages on five of the Company’s hotels, had no outstanding borrowings and backed $2.9 million in outstanding irrevocable letters of credit. The Company’s business plan does not contemplate the use of revolving credit during 2010. The termination of the credit facility will eliminate approximately $0.6 million in fees and associated costs per annum, and will further improve the Company’s financial flexibility by eliminating restrictive covenants and encumbrances. The Company expects to enter into a new, appropriately sized and structured credit facility in the future when its business plan contemplates the use of revolving credit.

Financial Covenants

The Company is subject to compliance with various covenants under its Series C preferred stock and its 4.6% Exchangeable Senior Notes due 2027 (the “Senior Notes”). As of December 31, 2009, the Company was in compliance with all covenants related to its Series C preferred stock and its Senior Notes.

Impairments and Other Charges

In conjunction with the Company’s annual year-end impairment evaluation, the Company recorded an impairment loss of $88.2 million in order to reduce the carrying values of six of the Mass Mutual portfolio hotels to their fair values as of December 31, 2009. The six hotels are currently held for non-sale disposition in advance of being deeded-back to Mass Mutual, along with two additional hotels, in satisfaction of their associated debt. The six hotels and their respective impairment charges were: Marriott Provo $11.2 million; Holiday Inn Downtown San Diego $7.2 million; Holiday Inn Express San Diego (Old Town) $1.4 million; Marriott Salt Lake City (University Park) $6.8 million; Hilton Huntington $41.1 million; and Renaissance Atlanta Concourse $20.5 million.

During the fourth quarter of 2009, the Company’s Doubletree Guest Suites Times Square joint venture recorded an impairment loss in order to reduce the carrying value of the hotel to its fair value. This impairment reduced the partners’ equity in the joint venture to a deficit. The Company has no guaranteed obligations to fund any losses of the partnership, therefore the Company’s impairment loss was limited to its remaining $26.0 million investment in the partnership. The impairment charge was taken against equity in net losses of unconsolidated joint ventures, effectively reducing the Company’s investment in the partnership to zero on its balance sheet as of December 31, 2009.

In December 2009, the Company determined that a $5.6 million note received from the buyer of 13 hotels the Company sold in 2006, along with the related interest accrued on the note may be uncollectible. As such, the Company recorded an allowance for bad debt of $5.6 million to reserve both the discounted note and the related interest receivable in full as of December 31, 2009.

Capital Improvements

During the fourth quarter of 2009, the Company invested $10.6 million in capital improvements to its portfolio. The Company’s 2009 capital improvement investments totaled $44.1 million.

 

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Dividend Update

On February 18, 2010, the Company’s board of directors declared a cash dividend of $0.50 per share payable to its Series A cumulative redeemable preferred stockholders and a cash dividend of $0.393 per share payable to its Series C cumulative convertible redeemable preferred stockholders. The dividends will be paid on April 15, 2010 to stockholders of record on March 31, 2010. No dividend was declared on the Company’s common stock.

The Company intends to make dividends on its stock in amounts equivalent to 100% of its annual taxable income. The level of any future dividends will be determined by the Company’s board of directors after considering taxable income projections, expected capital requirements, and risks affecting the Company’s business. In light of the Company’s intent to distribute 100% of its annual taxable income, future dividends may be reduced from past levels, or eliminated entirely. Dividends may be made in the form of cash or a combination of cash and stock consistent with Internal Revenue Code regulations.

Earnings Call

The Company will host a conference call to discuss fourth quarter and year-end results on February 23, 2010, at 2:00 p.m. PST. A live web cast of the call will be available via the Investor Relations section of the Company’s website at www.sunstonehotels.com. Alternatively, investors may dial 1-877-941-8631 (for domestic callers) or 1-480-629-9821 (for international callers) with passcode #4218080. A replay of the web cast will also be archived on the website.

About Sunstone Hotel Investors, Inc.

Sunstone Hotel Investors, Inc. is a lodging real estate investment trust (“REIT”) that, as of the date hereof, has interests in 38 hotels comprised of 13,199 rooms primarily in the upper upscale segment. Sunstone’s hotels are generally operated under nationally recognized brands, such as Marriott, Fairmont, Hilton and Hyatt. Upon the completion of the appointment of a receiver for the Marriott Ontario Airport and the eight hotels remaining in the Mass Mutual portfolio, the Company will own 29 hotels comprised of 10,966 rooms. For further information, please visit the Company’s website at www.sunstonehotels.com.

This press release contains forward-looking statements within the meaning of federal securities laws and regulations. These forward-looking statements are identified by their use of terms and phrases such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “should,” “will” and other similar terms and phrases, including references to assumptions and forecasts of future results. Forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors that may cause the actual results to differ materially from those anticipated at the time the forward-looking statements are made. These risks include, but are not limited to: volatility in the debt or equity markets affecting our ability to acquire or sell hotel assets; national and local economic and business conditions, including the likelihood of a prolonged U.S. recession; the ability to maintain sufficient liquidity and our access to capital markets; potential terrorist attacks, which would affect occupancy rates at our hotels and the demand for hotel products and services; operating risks associated with the hotel business; risks associated with the level of our indebtedness and our ability to meet covenants in our debt and equity agreements; relationships with property managers and franchisors; our ability to maintain our properties in a first-class manner, including meeting capital expenditure requirements; our ability to compete effectively in areas such as access, location, quality of accommodations and room rate structures; changes in travel patterns, taxes and government regulations, which influence or determine wages, prices, construction procedures and costs; our ability to identify, successfully compete for and complete acquisitions; the performance of hotels after they are acquired; necessary capital expenditures and our ability to fund them and complete them with minimum disruption; our ability to continue to satisfy complex rules in order for us to qualify as a REIT for federal income tax purposes; and other risks and uncertainties associated with our business described in the Company’s filings with the Securities and Exchange Commission. Although the Company believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that the expectations will be attained or that any deviation will not be material. All forward-looking information in this release is as of February 23, 2010, and the Company undertakes no obligation to update any forward-looking statement to conform the statement to actual results or changes in the Company’s expectations.

This release should be read in conjunction with the consolidated financial statements and notes thereto included in our most recent reports on Form 10-K and Form 10-Q. Copies of these reports are available on our website at www.sunstonehotels.com and through the SEC’s Electronic Data Gathering Analysis and Retrieval System (“EDGAR”) at www.sec.gov.

Non-GAAP Financial Measures

We present the following non-GAAP financial measures that we believe are useful to investors as key measures of our operating performance: (1) Earnings Before Interest Expense, Taxes, Depreciation and Amortization, or EBITDA; (2) Adjusted EBITDA (as defined below); (3) Funds From Operations, or FFO; (4) Adjusted FFO (as defined below); and (5) adjusted pro forma hotel EBITDA and pro forma hotel EBITDA margin for the purpose of our operating margins.

 

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EBITDA represents income available (loss attributable) to common stockholders excluding: (1) preferred stock dividends; (2) interest expense (including prepayment penalties, if any); (3) provision for income taxes, including income taxes applicable to sale of assets; and (4) depreciation and amortization. In addition, we have presented Adjusted EBITDA, which excludes: (1) amortization of deferred stock compensation; (2) the impact of any gain or loss from asset sales; (3) impairment charges; and (4) other adjustments we have identified in this release. We believe EBITDA and Adjusted EBITDA are useful to investors in evaluating our operating performance because these measures help investors evaluate and compare the results of our operations from period to period by removing the impact of our capital structure (primarily interest expense and preferred stock dividends) and our asset base (primarily depreciation and amortization) from our operating results. We also use EBITDA and Adjusted EBITDA as measures in determining the value of hotel acquisitions and dispositions. Reconciliations of income available (loss attributable) to common stockholders to EBITDA and Adjusted EBITDA are set forth on pages 9 and 10. A reconciliation and the components of adjusted pro forma hotel EBITDA and pro forma hotel EBITDA margin are set forth on page 11. We believe adjusted pro forma hotel EBITDA and pro forma hotel EBITDA margin are also useful to investors in evaluating our property-level operating performance.

We compute FFO in accordance with standards established by the National Association of Real Estate Investment Trusts, or NAREIT, an industry trade group. The Board of Governors of NAREIT in its March 1995 White Paper (as clarified in November 1999 and April 2002) defines FFO to mean income available (loss attributable) to common stockholders (computed in accordance with GAAP), excluding gains and losses from sales of property, plus real estate-related depreciation and amortization (excluding amortization of deferred financing costs), and after adjustment for unconsolidated partnerships and joint ventures. We also present Adjusted FFO, which excludes prepayment penalties, written-off deferred financing costs, impairment losses and other adjustments we have identified in this release. We believe that the presentation of FFO and Adjusted FFO provide useful information to investors regarding our operating performance because they are measures of our operations without regard to specified non-cash items such as real estate depreciation and amortization, gain or loss on sale of assets and certain other items which we believe are not indicative of the performance of our underlying hotel properties. We believe that these items are more representative of our asset base and our acquisition and disposition activities than our ongoing operations. We also use FFO as one measure in determining our results after taking into account the impact of our capital structure. Reconciliations of income available (loss attributable) to common stockholders to FFO and Adjusted FFO are set forth on pages 9 and 10.

We caution investors that amounts presented in accordance with our definitions of EBITDA, Adjusted EBITDA, FFO, Adjusted FFO, adjusted pro forma hotel EBITDA and pro forma hotel EBITDA margin may not be comparable to similar measures disclosed by other companies, because not all companies calculate these non-GAAP measures in the same manner. EBITDA, Adjusted EBITDA, FFO, Adjusted FFO, adjusted pro forma hotel EBITDA and pro forma hotel EBITDA margin should not be considered as an alternative measure of our net income (loss), operating performance, cash flow or liquidity. EBITDA, Adjusted EBITDA, FFO, Adjusted FFO, adjusted pro forma hotel EBITDA and pro forma hotel EBITDA margin may include funds that may not be available for our discretionary use due to functional requirements to conserve funds for capital expenditures and property acquisitions and other commitments and uncertainties. Although we believe that EBITDA, Adjusted EBITDA, FFO, Adjusted FFO, adjusted pro forma hotel EBITDA and pro forma hotel EBITDA margin can enhance an investor’s understanding of our results of operations, these non-GAAP financial measures, when viewed individually, are not necessarily a better indicator of any trend as compared to GAAP measures such as net income (loss) or cash flow from operations. In addition, you should be aware that adverse economic and market conditions may harm our cash flow.

Pro Forma Hotel EBITDA Margin Information

The revenue and expense items associated with the Company’s two commercial laundry facilities and the nine hotel properties held for non-sale disposition, any guaranty payments, and other miscellaneous non-hotel items have been shown below the adjusted pro forma hotel EBITDA line in presenting pro forma hotel EBITDA margins. Management believes the calculation of adjusted pro forma hotel EBITDA results in a more accurate presentation of hotel EBITDA margins of the Company’s 29 hotel portfolio. See page 11 for a reconciliation of adjusted pro forma hotel EBITDA to the comparable GAAP measure.

 

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The following tables include the Company’s 29 Hotel Portfolio, excluding W San Diego, Renaissance Westchester, Marriott Ontario Airport, and the Mass Mutual Eight Hotels (dollars in thousands, except ADR and RevPAR):

Operating Statistics:

 

		Occupancy %			ADR			RevPAR
Q1 2008		71.8	%		$	165.23		$	118.64
Q2 2008		80.0	%		$	173.01		$	138.41
Q3 2008		80.0	%		$	164.61		$	131.69
Q4 2008		67.5	%		$	167.25		$	112.89
FY 2008		74.5	%		$	167.58		$	124.85
Q1 2009		65.6	%		$	154.32		$	101.23
Q2 2009		70.7	%		$	148.96		$	105.31
Q3 2009		74.9	%		$	140.53		$	105.26
Q4 2009		66.4	%		$	146.55		$	97.31
FY 2009		69.3	%		$	147.32		$	102.09

 

Available Rooms:				Seasonality:
2008:				2008:
Q1		960,271		Q1		$	169,686		22.8	%
Q2		960,981		Q2			194,817		26.1	%
Q3		966,396		Q3			182,023		24.4	%
Q4		1,151,021		Q4			199,346		26.7	%
FY 2008		4,038,669		FY 2008		$	745,872		100.0	%
2009:				2009:
Q1		955,020		Q1		$	146,029		24.1	%
Q2		960,932		Q2			150,623		24.9	%
Q3		966,648		Q3			145,215		24.0	%
Q4		1,114,432		Q4			163,543		27.0	%
FY 2009		3,997,032		FY 2009		$	605,410		100.0	%

 

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Sunstone Hotel Investors, Inc.

Consolidated Balance Sheets

(In thousands, except share data)

 

		December 31, 2009				December 31, 2008
Assets
Current assets:
Cash and cash equivalents		$	358,610			$	176,102
Restricted cash			39,147				36,485
Accounts receivable, net			22,624				31,335
Due from affiliates			62				109
Inventories			2,446				2,490
Prepaid expenses			7,423				7,113
Investment in hotel properties of discontinued operations, net			—				225,165
Other current assets of discontinued operations, net			—				7,524
Investment in hotel properties of operations held for non-sale disposition, net			118,814				—
Other current assets of operations held for non-sale disposition, net			8,235				5,459
Total current assets			557,361				491,782
Investment in hotel properties, net			1,923,392				2,004,914
Investment in hotel properties of operations held for non-sale disposition, net			—				222,732
Other real estate, net			14,044				14,640
Investments in unconsolidated joint ventures			542				28,770
Deferred financing costs, net			7,300				9,913
Goodwill			4,673				8,621
Other assets, net			6,218				17,991
Other assets of operations held for non-sale disposition, net			—				6,248
Total assets		$	2,513,530			$	2,805,611
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable and accrued expenses		$	12,425			$	15,519
Accrued payroll and employee benefits			9,092				8,096
Due to Interstate SHP			9,817				13,785
Dividends payable			5,137				12,499
Other current liabilities			21,910				27,498
Current portion of notes payable			153,778				11,840
Current portion of notes payable of operations held for non-sale disposition			209,620				550
Other current liabilities of discontinued operations, net			40,451				100,052
Other current liabilities of operations held for non-sale disposition			7,362				5,766
Total current liabilities			469,592				195,605
Notes payable, less current portion			1,050,019				1,377,943
Notes payable, less current portion of operations held for non-sale disposition			—				211,167
Other liabilities			7,256				6,334
Other liabilities of operations held for non-sale disposition			—				54
Total liabilities			1,526,867				1,791,103
Commitments and contingencies			—				—
Preferred stock, Series C Cumulative Convertible Redeemable Preferred Stock, $0.01 par value, 4,102,564 shares authorized, issued and outstanding at December 31, 2009 and 2008, liquidation preference of $24.375 per share			99,896				99,696
Stockholders’ equity:
Preferred stock, $0.01 par value, 100,000,000 shares authorized. 8.0% Series A Cumulative Redeemable Preferred Stock, 7,050,000 shares issued and outstanding at December 31, 2009 and 2008, stated at liquidation preference of $25.00 per share			176,250				176,250
Common stock, $0.01 par value, 500,000,000 shares authorized, 96,904,075 shares issued and outstanding at December 31, 2009 and 47,864,654 shares issued and outstanding at December 31, 2008			969				479
Additional paid in capital			1,119,005				829,274
Retained earnings (deficit)			(8,949	)			260,659
Cumulative dividends			(397,527	)			(347,922	)
Accumulated other comprehensive loss			(2,981	)			(3,928	)
Total stockholders’ equity			886,767				914,812
Total liabilities and stockholders’ equity		$	2,513,530			$	2,805,611

 

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Sunstone Hotel Investors, Inc.

Consolidated Statements of Operations

(In thousands, except per share data)

 

		Three Months Ended December 31,								Year Ended December 31,
		2009				2008				2009				2008
Revenues
Room		$	108,502			$	129,892			$	408,150			$	504,104
Food and beverage			46,037				58,251				161,963				201,952
Other operating			15,476				18,582				53,744				59,140
Revenues of operations held for non-sale disposition			22,611				28,331				93,966				116,298
Total revenues			192,626				235,056				717,823				881,494
Operating expenses
Room			26,635				29,633				98,382				110,444
Food and beverage			32,994				40,788				118,629				145,576
Other operating			6,981				7,706				26,916				29,823
Advertising and promotion			9,775				10,654				35,693				39,219
Repairs and maintenance			7,657				8,537				27,360				29,579
Utilities			6,471				7,550				24,895				28,731
Franchise costs			5,574				6,260				20,656				24,658
Property tax, ground lease and insurance			12,433				11,467				43,352				44,993
Property general and administrative			19,695				23,565				72,823				86,797
Corporate overhead			10,418				4,527				25,242				21,511
Depreciation and amortization			22,976				23,333				93,795				93,759
Operating expenses of operations held for non-sale disposition			21,085				24,934				87,007				96,548
Property and goodwill impairment losses			—				57				30,852				57
Property and goodwill impairment losses of operations held for non-sale disposition			88,279				—				100,143				—
Total operating expenses			270,973				199,011				805,745				751,695
Operating income (loss)			(78,347	)			36,045				(87,922	)			129,799
Equity in net earnings (losses) of unconsolidated joint ventures			(25,185	)			100				(27,801	)			(1,445	)
Interest and other income			286				695				1,388				3,639
Interest and other income of operations held for non-sale disposition			—				15				9				69
Interest expense			(18,833	)			(20,750	)			(76,539	)			(83,176	)
Interest expense of operations held for non-sale disposition			(5,297	)			(3,253	)			(15,036	)			(13,016	)
Gain (loss) on extinguishment of debt			(53	)			—				54,506				—
Income (loss) from continuing operations			(127,429	)			12,852				(151,395	)			35,870
Income (loss) from discontinued operations			(536	)			(20,081	)			(118,213	)			35,368
Net income (loss)			(127,965	)			(7,229	)			(269,608	)			71,238
Dividends paid on unvested restricted stock compensation			—				(73	)			(447	)			(814	)
Preferred stock dividends and accretion			(5,187	)			(5,187	)			(20,749	)			(20,884	)
Income available (loss attributable) to common stockholders		$	(133,152	)		$	(12,489	)		$	(290,804	)		$	49,540
Basic per share amounts:
Income (loss) from continuing operations available (attributable) to common stockholders		$	(1.44	)		$	0.16			$	(2.47	)		$	0.26
Income (loss) from discontinued operations			(0.01	)			(0.42	)			(1.70	)			0.66
Basic income available (loss attributable) to common stockholders per common share		$	(1.45	)		$	(0.26	)		$	(4.17	)		$	0.92
Diluted per share amounts:
Income (loss) from continuing operations available (attributable) to common stockholders		$	(1.44	)		$	0.16			$	(2.47	)		$	0.26
Income (loss) from discontinued operations			(0.01	)			(0.42	)			(1.70	)			0.66
Diluted income available (loss attributable) to common stockholders per common share		$	(1.45	)		$	(0.26	)		$	(4.17	)		$	0.92
Weighted average common shares outstanding:
Basic			91,892				47,853				69,820				53,633
Diluted			91,892				47,853				69,820				53,662
Dividends declared per common share		$	—			$	0.75			$	—			$	1.80

 

8

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Sunstone Hotel Investors, Inc.

Reconciliation of Income Available (Loss Attributable) to Common Stockholders to Non-GAAP Financial Measures

(Unaudited and in thousands except per share amounts)

Reconciliation of Income Available (Loss Attributable) to Common Stockholders to EBITDA and Adjusted EBITDA

 

		Three Months Ended December 31,								Year Ended December 31,
		2009				2008				2009				2008
Income available (loss attributable) to common stockholders		$	(133,152	)		$	(12,489	)		$	(290,804	)		$	49,540
Dividends paid on unvested restricted stock compensation			—				73				447				814
Series A and C preferred stock dividends			5,187				5,187				20,749				20,884
Operations held for investment:
Depreciation and amortization			22,976				23,333				93,795				93,759
Interest expense			17,311				19,576				71,940				78,538
Interest expense - default rate			472				—				472				—
Amortization of deferred financing fees			606				284				1,823				1,133
Write-off of deferred financing fees			—				—				284				—
Loan penalties and fees			207				—				207				—
Non-cash interest related to discount on Senior Notes			237				890				1,813				3,505
Unconsolidated joint ventures:
Depreciation and amortization			1,271				1,192				5,131				5,000
Interest expense			628				1,197				2,614				5,168
Amortization of deferred financing fees			55				494				192				1,547
Amortization of deferred stock compensation			19				(30	)			47				47
Operations held for non-sale disposition:
Depreciation and amortization			2,161				2,955				11,157				11,561
Interest expense			3,117				3,118				12,428				12,474
Interest expense - default rate			1,407				—				1,407				—
Amortization of deferred financing fees			135				135				541				542
Loan penalties and fees			638				—				660				—
Discontinued operations:
Depreciation and amortization			420				2,935				6,108				14,094
Interest expense			374				1,399				4,513				5,575
Amortization of deferred financing fees			4				7				25				27
Loan penalties and fees			53				—				3,124				—
EBITDA			(75,874	)			50,256				(51,327	)			304,208
Amortization of deferred stock compensation			769				720				4,055				3,975
(Gain) loss on sale of assets			(21	)			16,095				12,677				(26,013	)
(Gain) loss on extinguishment of debt			53				—				(54,506	)			—
Impairment loss - operations held for investment			—				57				30,852				57
Impairment loss - unconsolidated joint ventures			26,007				—				26,007				—
Impairment loss - operations held for non-sale disposition			88,279				—				100,143				—
Impairment loss - discontinued operations			—				2,847				95,150				2,847
Bad debt expense on corporate note receivable			5,557				—				5,557				—
			120,644				19,719				219,935				(19,134	)
Adjusted EBITDA		$	44,770			$	69,975			$	168,608			$	285,074
Reconciliation of Income Available (Loss Attributable) to Common Stockholders to FFO and Adjusted FFO
Income available (loss attributable) to common stockholders		$	(133,152	)		$	(12,489	)		$	(290,804	)		$	49,540
Dividends paid on unvested restricted stock compensation			—				73				447				814
Series C preferred stock dividends			—				1,662				—				6,784
Real estate depreciation and amortization - operations held for investment			22,890				23,163				93,248				92,953
Real estate depreciation and amortization - unconsolidated joint ventures			1,254				1,165				5,060				4,949
Real estate depreciation and amortization - operations held for non-sale disposition			2,161				2,955				11,157				11,561
Real estate depreciation and amortization - discontinued operations			420				2,935				6,108				14,094
(Gain) loss on sale of assets			(21	)			16,095				12,677				(26,013	)
FFO available to common stockholders			(106,448	)			35,559				(162,107	)			154,682
Operations held for investment:
Interest expense - default rate			472				—				472				—
Write-off of deferred financing fees			—				—				284				—
Loan penalties and fees			207				—				207				—
Operations held for non-sale disposition:
Interest expense - default rate			1,407				—				1,407				—
Loan penalties and fees			638				—				660				—
Discontinued operations:
Loan penalties and fees			53				—				3,124				—
(Gain) loss on extinguishment of debt			53				—				(54,506	)			—
Impairment loss - operations held for investment			—				57				30,852				57
Impairment loss - unconsolidated joint ventures			26,007				—				26,007				—
Impairment loss - operations held for non-sale disposition			88,279				—				100,143				—
Impairment loss - discontinued operations			—				2,847				95,150				2,847
Bad debt expense on corporate note receivable			5,557				—				5,557				—
			122,673				2,904				209,357				2,904
Adjusted FFO available to common stockholders		$	16,225			$	38,463			$	47,250			$	157,586
FFO available to common stockholders per diluted share		$	(1.15	)		$	0.68			$	(2.32	)		$	2.68
Adjusted FFO available to common stockholders per diluted share		$	0.18			$	0.74			$	0.68			$	2.73
Basic weighted average shares outstanding			91,892				47,853				69,820				53,633
Shares associated with unvested restricted stock awards			343				—				—				29
Diluted weighted average shares outstanding before adjustments for Series C			92,235				47,853				69,820				53,662
Shares associated with Series C preferred stock			—				4,103				—				4,103
Diluted weighted average shares outstanding (1)			92,235				51,956				69,820				57,765
2008 restated due to stock dividend (2):
FFO available to common stockholders per diluted share						$	0.62							$	2.45
Adjusted FFO available to common stockholders per diluted share						$	0.67							$	2.50
Diluted weighted average shares outstanding							57,400								63,016

 

(1)	Diluted weighted average shares outstanding includes the Series C convertible preferred stock on an “as-converted” basis if such treatment is dilutive.

(2)

Diluted weighted average common shares and per share FFO and Adjusted FFO for the three months and year ended December 31, 2008 have been retroactively adjusted for the effect of shares of common stock issued pursuant to the stock dividend paid in January 2009 on an “as-converted” basis for the Series C convertible preferred stock.

 

9

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Sunstone Hotel Investors, Inc.

Pro Forma Reconciliation of Loss Attributable to Common Stockholders to Non-GAAP Financial Measures

(Unaudited and in thousands except per share amounts)

Pro Forma Reconciliation of Loss Attributable to Common Stockholders to EBITDA and Adjusted EBITDA

 

		Year Ended December 31, 2009
						Held for				Non-Sale				Discontinued Operations
		Actual (1)				Investment (2)				Disposition (3)				Receivership (4)				Disposals (5)				Pro Forma (6)
Loss attributable to common stockholders		$	(290,804	)		$	4,504			$	108,211			$	99,698			$	18,515			$	(59,876	)
Dividends paid on unvested restricted stock compensation			447				—				—				—				—				447
Series A and C preferred stock dividends			20,749				—				—				—				—				20,749
Operations held for investment:
Depreciation and amortization			93,795				—				—				—				—				93,795
Interest expense			71,940				(3,707	)			—				—				—				68,233
Interest expense - default rate			472				(472	)			—				—				—				—
Amortization of deferred financing fees			1,823				(118	)			—				—				—				1,705
Write-off of deferred financing fees			284				—				—				—				—				284
Loan penalties and fees			207				(207	)			—				—				—				—
Non-cash interest related to discount on Senior Notes			1,813				—				—				—				—				1,813
Unconsolidated joint ventures:
Depreciation and amortization			5,131				—				—				—				—				5,131
Interest expense			2,614				—				—				—				—				2,614
Amortization of deferred financing fees			192				—				—				—				—				192
Amortization of deferred stock compensation			47				—				—				—				—				47
Operations held for non-sale disposition:
Depreciation and amortization			11,157				—				(11,157	)			—				—				—
Interest expense			12,428				—				(12,428	)			—				—				—
Interest expense - default rate			1,407				—				(1,407	)			—				—				—
Amortization of deferred financing fees			541				—				(541	)			—				—				—
Loan penalties and fees			660				—				(660	)			—				—				—
Discontinued operations:
Depreciation and amortization			6,108				—				—				(4,144	)			(1,964	)			—
Interest expense			4,513				—				—				(4,513	)			—				—
Amortization of deferred financing fees			25				—				—				(25	)			—				—
Loan penalties and fees			3,124				—				—				(3,124	)			—				—
EBITDA			(51,327	)			—				82,018				87,892				16,551				135,134
Amortization of deferred stock compensation			4,055				—				—				—				—				4,055
(Gain) loss on sale of assets			12,677				—				—				—				(13,052	)			(375	)
Gain on extinguishment of debt			(54,506	)			—				—				—				—				(54,506	)
Impairment loss - operations held for investment			30,852				—				—				—				—				30,852
Impairment loss - unconsolidated joint ventures			26,007				—				—				—				—				26,007
Impairment loss - operations held for non-sale disposition			100,143				—				(100,143	)			—				—				—
Impairment loss - discontinued operations			95,150				—				—				(90,232	)			(4,918	)			—
Bad debt expense on corporate note receivable			5,557				—				—				—				—				5,557
			219,935				—				(100,143	)			(90,232	)			(17,970	)			11,590
Adjusted EBITDA		$	168,608			$	—			$	(18,125	)		$	(2,340	)		$	(1,419	)		$	146,724
Pro Forma Reconciliation of Loss Attributable to Common Stockholders to FFO and Adjusted FFO
Loss attributable to common stockholders		$	(290,804	)		$	4,504			$	108,211			$	99,698			$	18,515			$	(59,876	)
Dividends paid on unvested restricted stock compensation			447				—				—				—				—				447
Real estate depreciation and amortization - operations held for investment			93,248				—				—				—				—				93,248
Real estate depreciation and amortization - unconsolidated joint ventures			5,060				—				—				—				—				5,060
Real estate depreciation and amortization - operations held for non-sale disposition			11,157				—				(11,157	)			—				—				—
Real estate depreciation and amortization - discontinued operations			6,108				—				—				(4,144	)			(1,964	)			—
(Gain) loss on sale of assets			12,677				—				—				—				(13,052	)			(375	)
FFO available to common stockholders			(162,107	)			4,504				97,054				95,554				3,499				38,504
Operations held for investment:
Interest expense - default rate			472				(472	)			—				—				—				—
Write-off of deferred financing fees			284				—				—				—				—				284
Loan penalties and fees			207				(207	)			—				—				—				—
Operations held for non-sale disposition:
Interest expense - default rate			1,407				—				(1,407	)			—				—
Loan penalties and fees			660				—				(660	)			—				—				—
Discontinued operations:
Loan penalties and fees			3,124				—				—				(3,124	)			—				—
Gain on extinguishment of debt			(54,506	)			—				—				—				—				(54,506	)
Impairment loss - operations held for investment			30,852				—				—				—				—				30,852
Impairment loss - unconsolidated joint ventures			26,007				—				—				—				—				26,007
Impairment loss - operations held for non-sale disposition			100,143				—				(100,143	)			—				—				—
Impairment loss - discontinued operations			95,150				—				—				(90,232	)			(4,918	)			—
Bad debt expense on corporate note receivable			5,557				—				—				—				—				5,557
			209,357				(679	)			(102,210	)			(93,356	)			(4,918	)			8,194
Adjusted FFO available to common stockholders		$	47,250			$	3,825			$	(5,156	)		$	2,198			$	(1,419	)		$	46,698
FFO available to common stockholders per diluted share		$	(2.32	)		$	0.06			$	1.39			$	1.37			$	0.05			$	0.55
Adjusted FFO available to common stockholders per diluted share		$	0.68			$	0.05			$	(0.07	)		$	0.03			$	(0.02	)		$	0.67
Diluted weighted average shares outstanding (7)			69,820				69,820				69,820				69,820				69,820				69,820

 

(1)	Actual includes the 43 hotels held for investment, held for non-sale disposition, held in receivership or disposed by the Company during 2009.

(2)	Held for Investment includes the debt service on the three Mass Mutual hotels that are expected to be released from the secured mortgage in 2010.

(3)	Non-sale disposition includes Marriott Ontario Airport and the eight Mass Mutual hotels that are in the process of being transferred to a receiver.

(4)	Receivership includes the W San Diego and Renaissance Westchester hotels that have been transferred to a receiver.

(5)	Disposals include the Marriott Napa Valley, Marriott Riverside and Hyatt Suites Atlanta Northwest hotels that were sold in 2009.

(6)	Pro forma includes the 29 hotels held for investment by the Company at December 31, 2009.

(7)	Diluted weighted average shares outstanding excludes the Series C convertible preferred stock on an “as-converted” basis since such treatment is anti-dilutive.

 

10

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Sunstone Hotel Investors, Inc.

Pro Forma Hotel EBITDA Margins

(Unaudited and in thousands except hotels and rooms)

 

		Three Months Ended December 31,								Year Ended December 31,
		2009 (1)				2008 (1)				2009 (1)				2008 (1)
Number of Hotels			29				29				29				29
Number of Rooms			10,966				10,966				10,966				10,966
Hotel Pro Forma EBITDA Margin (2)			23.8	%			28.4	%			24.8	%			29.5	%
Hotel Revenues
Room revenue		$	108,502			$	129,892			$	408,150			$	504,104
Food and beverage revenue			46,037				58,251				161,963				201,952
Other operating revenue			9,027				11,227				35,427				40,004
Total Hotel Revenues			163,566				199,370				605,540				746,060
Hotel Expenses
Room expense			26,872				29,850				99,365				111,410
Food and beverage expense			33,009				40,800				118,680				145,625
Other hotel expense			45,549				49,075				166,201				184,231
General and administrative expense			19,248				23,021				71,040				84,959
Total Hotel Expenses			124,678				142,746				455,286				526,225
Adjusted Pro Forma Hotel EBITDA			38,888				56,624				150,254				219,835
Marriott Ontario Airport and Mass Mutual Eight Hotels:
Revenues of operations held for non-sale disposition			22,611				28,331				93,966				116,298
Operating expenses of operations held for non-sale disposition			(21,085	)			(24,934	)			(87,007	)			(96,548	)
Property and goodwill impairment losses of operations held for non-sale disposition			(88,279	)			—				(100,143	)			—
Hotel performance guaranty			2,507				3,493				2,507				3,493
Non-hotel operating income			405				448				2,390				2,048
Corporate overhead			(10,418	)			(4,527	)			(25,242	)			(21,511	)
Depreciation and amortization			(22,976	)			(23,333	)			(93,795	)			(93,759	)
Property and goodwill impairment losses			—				(57	)			(30,852	)			(57	)
Operating Income (Loss)			(78,347	)			36,045				(87,922	)			129,799
Equity in net earnings (losses) of unconsolidated joint ventures			(25,185	)			100				(27,801	)			(1,445	)
Interest and other income			286				695				1,388				3,639
Interest and other income of operations held for non-sale disposition			—				15				9				69
Interest expense			(18,833	)			(20,750	)			(76,539	)			(83,176	)
Interest expense of operations held for non-sale disposition			(5,297	)			(3,253	)			(15,036	)			(13,016	)
Gain (loss) on extinguishment of debt			(53	)			—				54,506				—
Income (loss) from discontinued operations			(536	)			(20,081	)			(118,213	)			35,368
Net Income (Loss)		$	(127,965	)		$	(7,229	)		$	(269,608	)		$	71,238

 

(1)

Represents our ownership results for the 29 hotels we owned as of the end of the period, excluding the Marriott Ontario Airport and eight of the 11 hotels included in the Mass Mutual portfolio, which have been reclassified as “Operations Held for Non-Sale Disposition” on our balance sheets and statements of operations, and the W San Diego and the Renaissance Westchester, which have been reclassified as discontinued operations on our balance sheets and statements of operations.

(2)	Hotel Pro Forma EBITDA Margin is calculated as Adjusted Pro Forma Hotel EBITDA divided by total hotel revenues.

 

11

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Sunstone Hotel Investors, Inc.

Operating Statistics by Region

(Unaudited)

 

						Three Months Ended December 31, 2009									Three Months Ended December 31, 2008									Percent Change in
		Number		Number		Occupancy			Average			Comparable			Occupancy			Average			Comparable			Comparable
Region		of Hotels		of Rooms		Percentages			Daily Rate			RevPAR			Percentages			Daily Rate			RevPAR			RevPAR
California (1)		9		2,983		68.8	%		$	116.13		$	79.90		70.5	%		$	136.16		$	95.99		-16.8	%
Other West (2)		5		1,575		61.7	%			110.13			67.95		70.8	%			122.85			86.98		-21.9	%
Midwest (3)		7		2,177		64.1	%			123.52			79.18		60.9	%			148.29			90.31		-12.3	%
East (4)		8		4,231		67.5	%			186.55			125.92		67.4	%			208.60			140.60		-10.4	%
Total		29		10,966		66.4	%		$	146.55		$	97.31		67.5	%		$	167.25		$	112.89		-13.8	%
						Year Ended December 31, 2009									Year Ended December 31, 2008									Percent Change in
		Number		Number		Occupancy			Average			Comparable			Occupancy			Average			Comparable			Comparable
Region		of Hotels		of Rooms		Percentages			Daily Rate			RevPAR			Percentages			Daily Rate			RevPAR			RevPAR
California (1)		9		2,983		72.5	%		$	125.45		$	90.95		78.6	%		$	148.12		$	116.42		-21.9	%
Other West (2)		5		1,575		66.7	%			115.58			77.09		78.2	%			123.34			96.45		-20.1	%
Midwest (3)		7		2,177		64.7	%			126.54			81.87		67.0	%			146.80			98.36		-16.8	%
East (4)		8		4,231		70.5	%			184.25			129.90		74.1	%			208.85			154.76		-16.1	%
Total		29		10,966		69.3	%		$	147.32		$	102.09		74.5	%		$	167.58		$	124.85		-18.2	%

 

(1)

Does not include the Marriott Ontario Airport and four hotels in the Mass Mutual portfolio, reclassified as “Operations Held for Non-Sale Disposition” on our balance sheets and statements of operations, and the W San Diego, reclassified as discontinued operations on our balance sheets and statements of operations.

(2)	Includes Oregon, Texas and Utah. Does not include two hotels in the Mass Mutual portfolio, reclassified as “Operations Held for Non-Sale Disposition” on our balance sheets and statements of operations.

(3)	Includes Illinois, Michigan and Minnesota.

(4)

Includes Florida, Maryland, Massachusetts, New York, Pennsylvania, Virginia and District of Columbia. Does not include two hotels in the Mass Mutual portfolio, reclassified as “Operations Held for Non-Sale Disposition” on our balance sheets and statements of operations, and the Renaissance Westchester, reclassified as discontinued operations on our balance sheets and statements of operations.

 

12

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Sunstone Hotel Investors, Inc.

Operating Statistics by Brand

(Unaudited)

 

						Three Months Ended December 31, 2009									Three Months Ended December 31, 2008									Percent Change in
		Number		Number		Occupancy			Average			Comparable			Occupancy			Average			Comparable			Comparable
Brand		of Hotels		of Rooms		Percentages			Daily Rate			RevPAR			Percentages			Daily Rate			RevPAR			RevPAR
Marriott (1)		17		6,587		65.5	%		$	147.81		$	96.82		67.2	%		$	166.83		$	112.11		-13.6	%
Hilton (2)		6		2,133		70.8	%			183.07			129.61		72.2	%			209.49			151.25		-14.3	%
Hyatt		1		403		77.9	%			101.44			79.02		69.2	%			127.81			88.44		-10.7	%
Other Brand Affiliations (3)		2		647		69.3	%			113.20			78.45		70.0	%			140.04			98.03		-20.0	%
Independent		3		1,196		59.5	%			101.01			60.10		59.1	%			111.49			65.89		-8.8	%
Total		29		10,966		66.4	%		$	146.55		$	97.31		67.5	%		$	167.25		$	112.89		-13.8	%
						Year Ended December 31, 2009									Year Ended December 31, 2008									Percent Change in
		Number		Number		Occupancy			Average			Comparable			Occupancy			Average			Comparable			Comparable
Brand		of Hotels		of Rooms		Percentages			Daily Rate			RevPAR			Percentages			Daily Rate			RevPAR			RevPAR
Marriott (1)		17		6,587		68.9	%		$	151.87		$	104.64		74.2	%		$	168.41		$	124.96		-16.3	%
Hilton (2)		6		2,133		71.9	%			170.50			122.59		78.2	%			205.17			160.44		-23.6	%
Hyatt		1		403		75.4	%			119.36			90.00		78.3	%			148.38			116.18		-22.5	%
Other Brand Affiliations (3)		2		647		72.3	%			121.61			87.92		78.3	%			147.44			115.45		-23.8	%
Independent		3		1,196		63.4	%			100.38			63.64		66.3	%			103.94			68.91		-7.6	%
Total		29		10,966		69.3	%		$	147.32		$	102.09		74.5	%		$	167.58		$	124.85		-18.2	%

 

(1)

Does not include the Marriott Ontario Airport and five hotels included in the Mass Mutual portfolio, reclassified as “Operations Held for Non-Sale Disposition” on our balance sheets and statements of operations, and the Renaissance Westchester, reclassified as discontinued operations on our balance sheets and statements of operations.

(2)	Does not include one hotel included in the Mass Mutual portfolio, reclassified as “Operations Held for Non-Sale Disposition” on our balance sheets and statements of operations.

(3)

Includes a Fairmont and a Sheraton. Does not include two hotels included in the Mass Mutual portfolio, reclassified as “Operations Held for Non-Sale Disposition” on our balance sheets and statements of operations, and the W San Diego, reclassified as discontinued operations on our balance sheets and statements of operations.

 

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Sunstone Hotel Investors, Inc.

Debt Summary

(Unaudited - dollars in thousands)

 

				Interest Rate /			Maturity		December 31, 2009
Debt		Collateral		Spread			Date		Balance(1)
Fixed Rate Debt
Secured Mortgage Debt		Hilton Times Square		5.92	%		12/1/2010		$	81,000
Secured Mortgage Debt		Renaissance Long Beach		4.98	%		7/1/2012			34,003
Secured Mortgage Debt		Rochester laundry facility		9.88	%		6/1/2013			3,331
Secured Mortgage Debt		Doubletree Minneapolis		5.34	%		5/1/2015			18,029
Secured Mortgage Debt		Hilton Del Mar		5.34	%		5/1/2015			26,147
Secured Mortgage Debt		Marriott Houston		5.34	%		5/1/2015			24,001
Secured Mortgage Debt		Marriott Park City		5.34	%		5/1/2015			15,646
Secured Mortgage Debt		Marriott Philadelphia		5.34	%		5/1/2015			28,350
Secured Mortgage Debt		Marriott Troy		5.34	%		5/1/2015			36,704
Secured Mortgage Debt		Marriott Tysons Corner		5.34	%		5/1/2015			46,835
Secured Mortgage Debt		The Kahler Grand		5.34	%		5/1/2015			28,872
Secured Mortgage Debt		Valley River Inn		5.34	%		5/1/2015			12,048
Secured Mortgage Debt		Renaissance Harborplace		5.13	%		1/1/2016			105,241
Secured Mortgage Debt		Marriott Del Mar		5.69	%		1/11/2016			48,000
Secured Mortgage Debt		Hilton Houston North		5.66	%		3/11/2016			33,696
Secured Mortgage Debt		Renaissance Orlando at SeaWorld®		5.52	%		7/1/2016			85,700
Secured Mortgage Debt		Embassy Suites Chicago		5.58	%		3/1/2017			75,000
Secured Mortgage Debt		Marriott Boston Long Wharf		5.58	%		4/11/2017			176,000
Secured Mortgage Debt		Embassy Suites La Jolla		6.60	%		6/1/2019			70,000
Secured Mortgage Debt		Renaissance Washington D.C.		5.95	%		5/1/2021			134,036
Exchangeable Senior Notes		Guaranty		4.60	%		7/15/2027			62,500
Total Fixed Rate Debt										1,145,139
Credit Facility		5 Hotels		L+3.75	% - 5.25%		7/17/2011			—
TOTAL DEBT									$	1,145,139
Preferred Stock
Series A cumulative redeemable preferred				8.00	%		perpetual		$	176,250
Series C cumulative convertible redeemable preferred				6.45	%		perpetual		$	100,000
Debt Statistics
% Fixed Rate Debt										100.0	%
% Floating Rate Debt										0.0	%
Average Interest Rate										5.56	%
Weighted Average Maturity of Debt (2)										7.2 years

 

(1)	Excludes debt in the Company’s secured debt restructuring program.

(2)	Assumes the exchangeable senior notes remain outstanding to maturity. If the exchangeable senior notes were redeemed upon the first put date, the weighted average maturity would be approximately 6 years.

 

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