STRATEGIC HOTELS & RESORTS, INC - FORM 8-K - EX-99.2 - EXHIBIT 99.2

Attached files

file	filename
EX-99.1 - EXHIBIT 99.1 - STRATEGIC HOTELS & RESORTS, INC	a93013exhibit991a-pressrel.htm
8-K - 8-K - STRATEGIC HOTELS & RESORTS, INC	a930138kpressrelease.htm
EX-99.1 - EXHIBIT 99.1 ATTACHMENTS - STRATEGIC HOTELS & RESORTS, INC	a93013exhibit991b-pressrel.htm

Exhibit 99.2

Strategic Hotels & Resorts, Inc.

Supplemental Financial Information

September 30, 2013




		Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)		September 30, 2013

TABLE OF CONTENTS




	PAGE
CORPORATE INFORMATION
The Company	1
Board of Directors	2
Officers	3
Equity Research Coverage	4

FINANCIAL HIGHLIGHTS
Supplemental Financial Data	5
Consolidated Statements of Operations	6
Consolidated Balance Sheets	7
Investments in Unconsolidated Affiliates	8
Leasehold Information	10
Non-GAAP Financial Measures	11
Reconciliation of Net Income (Loss) Attributable to SHR Common Shareholders to EBITDA and Comparable EBITDA	12
Reconciliation of Net Income (Loss) Attributable to SHR Common Shareholders to Funds From Operations (FFO), FFO—Fully Diluted and Comparable FFO	13
Debt Summary	14

PORTFOLIO DATA
Portfolio at September 30, 2013	15
Seasonality by Geographic Region	16
Operating Statistics by Geographic Region	17
Selected Financial and Operating Information by Property	18
Reconciliation of Property EBITDA to EBITDA	23
Reconciliation of Property EBITDA to Comparable EBITDA	24
2013 Guidance	25




		Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)		September 30, 2013

CORPORATE INFORMATION

The Company

Strategic Hotels & Resorts, Inc. is an industry-leading owner and asset manager of high-end hotels and resorts. We own interests in or lease a quality portfolio of upper upscale and luxury hotels and resorts in desirable North American and European locations. Our portfolio is currently made up of 18 properties totaling 8,272 rooms. We own interests in or lease unique hotels with complex operations, sophisticated customers and multiple revenue streams. Our properties include large convention hotels, business hotels and resorts, which are managed by internationally recognized hotel management companies.

We believe our asset management expertise is what truly distinguishes us. Asset management is our focus, our core competency, and our competitive advantage. Our business is driven by our team’s depth of knowledge and hands-on expertise in every aspect of the lodging industry. While our focus is to drive top line revenues, we importantly focus on every component of bottom line profitability. We use our experience to make selective, value added acquisitions and recycle capital through thoughtful and planned dispositions. Simply put, we are utilizing our expert management skills in building a great hotel company which we believe will provide attractive returns for our shareholders.

Strategic Hotels & Resorts, Inc. is a real estate investment trust (REIT) and is traded on the New York Stock Exchange under the symbol BEE.

Fiscal Year End:

December 31

Number of Full-Time Equivalent Employees:

Corporate Headquarters:

200 West Madison Street, Suite 1700

Chicago, IL 60606

(312) 658-5000

Company Contacts:

Diane M. Morefield

Executive Vice President, Chief Financial Officer

(312) 658-5000

Jonathan P. Stanner

Vice President, Capital Markets and Treasurer

(312) 658-5000




		Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)		September 30, 2013

Board of Directors

Raymond L. Gellein, Jr.

Chairman of the Board, Chief Executive Officer and President

Sheli Z. Rosenberg

Lead Independent Director

Robert P. Bowen

Director and Chairman of the Audit Committee

James A. Jeffs

Director and Chairman of the Compensation Committee

William A. Prezant

Director and Chairman of the Corporate Governance and Nominating Committee

Kenneth Fisher

Director

Richard D. Kincaid

Director

Sir David M.C. Michels

Director

Eugene F. Reilly

Director




		Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)		September 30, 2013

Officers

Raymond L. Gellein, Jr.

Chief Executive Officer and President

Diane M. Morefield

Executive Vice President, Chief Financial Officer (Principal Financial Officer)

Richard J. Moreau

Executive Vice President, Chief Operating Officer

Paula C. Maggio

Executive Vice President, Secretary & General Counsel

Stephen M. Briggs

Senior Vice President, Chief Accounting Officer (Principal Accounting Officer)

John K.T. Barrett

Senior Vice President, Asset Management

Thomas G. Healy

Senior Vice President, Asset Management

David R. Hogin, Jr.

Senior Vice President, Asset Management

Robert T. McAllister

Senior Vice President, Tax

Patricia A. Needham

Senior Vice President, Assistant Secretary

Gregory A. Brenner

Vice President, Controller

Michael A. Dalton

Vice President, Design

Eric D. Hassberger

Vice President, Asset Management

James L. Porter

Vice President, Internal Audit

Jonathan P. Stanner

Vice President, Capital Markets and Treasurer




		Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)		September 30, 2013

Equity Research Coverage




Firm	Analyst	Telephone

Bank of America Merrill Lynch	Andrew Didora	(646) 855-2924

Deutsche Bank North America	Chris Woronka	(212) 250-4486

Evercore Partners	Smedes Rose	(212) 497-0881

Green Street Advisors	Lukas Hartwich	(949) 640-8780

International Strategy & Investment Group, Inc.	Ian Weissman	(212) 446-9461

JMP Securities	Will Marks	(415) 835-8944

J.P. Morgan Securities	Jonathan Mohraz	(212) 622-1111

MLV & Co	Ryan Meliker	(212) 542-5872

Raymond James & Associates	William Crow	(727) 567-2594

Wells Fargo Securities, LLC	Jeffrey Donnelly	(617) 603-4262

Strategic Hotels & Resorts, Inc. is followed by the analysts listed above. Please note that any opinions, estimates or forecasts regarding Strategic Hotels & Resorts, Inc.'s performance made by these analysts are theirs alone and do not represent opinions, forecasts or predictions of Strategic Hotels & Resorts, Inc. or its management. Strategic Hotels & Resorts, Inc. does not by its reference here imply its endorsement of, or concurrence with, such information, conclusions or recommendations.




		Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)		September 30, 2013

Financial Highlights

Supplemental Financial Data

(in thousands, except per share information)



	September 30, 2013
	Pro Rata Share			Consolidated
Capitalization
Shares of common stock outstanding	205,527			205,527
Operating partnership units outstanding	853			853
Restricted stock units outstanding	1,633			1,633
Combined shares and units outstanding	208,013			208,013
Common stock price at end of period	$	8.68		$	8.68
Common equity capitalization	$	1,805,553		$	1,805,553
Preferred equity capitalization (at $25.00 face value)	289,102			289,102
Consolidated debt	1,299,567			1,299,567
Pro rata share of unconsolidated debt	239,400			—
Pro rata share of consolidated debt	(133,042		)	—
Cash and cash equivalents	(79,801		)	(79,801		)
Total enterprise value	$	3,420,779		$	3,314,421
Net Debt / Total Enterprise Value	38.8		%	36.8		%
Preferred Equity / Total Enterprise Value	8.4		%	8.7		%
Common Equity / Total Enterprise Value	52.8		%	54.5		%



		Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)		Three and Nine Months Ended September 30, 2013 and 2012

Consolidated Statements of Operations

(in thousands, except per share data)



	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
Revenues:
Rooms	$	144,150		$	119,067		$	393,072		$	323,709
Food and beverage	69,625			63,283			221,260			197,693
Other hotel operating revenue	22,417			21,040			65,132			59,338
Lease and other revenue	1,416			1,175			3,776			3,505
Total revenues	237,608			204,565			683,240			584,245
Operating Costs and Expenses:
Rooms	38,525			32,069			110,711			90,628
Food and beverage	56,359			47,355			170,763			143,065
Other departmental expenses	59,401			52,908			173,827			153,557
Management fees	7,024			6,182			20,767			18,012
Other hotel expenses	14,771			13,988			47,826			40,360
Lease expense	1,202			1,114			3,584			3,425
Depreciation and amortization	26,244			25,649			80,459			76,416
Impairment losses and other charges	728			—			728			—
Corporate expenses	5,487			6,956			18,880			23,632
Total operating costs and expenses	209,741			186,221			627,545			549,095
Operating income	27,867			18,344			55,695			35,150
Interest expense	(21,106		)	(19,942		)	(63,871		)	(58,627		)
Interest income	12			42			45			122
Equity in earnings (losses) of unconsolidated affiliates	451			(2,257		)	3,252			(2,054		)
Foreign currency exchange (loss) gain	(9		)	(996		)	177			(1,169		)
Other (expenses) income, net	(832		)	436			45			1,365
Income (loss) before income taxes and discontinued operations	6,383			(4,373		)	(4,657		)	(25,213		)
Income tax benefit (expense)	430			600			(1,121		)	(215		)
Income (loss) from continuing operations	6,813			(3,773		)	(5,778		)	(25,428		)
Loss from discontinued operations, net of tax	—			—			—			(535		)
Net Income (Loss)	6,813			(3,773		)	(5,778		)	(25,963		)
Net (income) loss attributable to the noncontrolling interests in SHR's operating partnership	(29		)	17			22			126
Net loss attributable to the noncontrolling interests in consolidated affiliates	3,018			1,241			7,467			891
Net income (loss) attributable to SHR	9,802			(2,515		)	1,711			(24,946		)
Preferred shareholder dividends	(6,042		)	(6,042		)	(18,125		)	(18,125		)
Net income (loss) attributable to SHR common shareholders	$	3,760		$	(8,557	)	$	(16,414	)	$	(43,071	)
Basic Income (Loss) Per Share:
Income (loss) from continuing operations attributable to SHR common shareholders	$	0.02		$	(0.04	)	$	(0.08	)	$	(0.22	)
Loss from discontinued operations attributable to SHR common shareholders	—			—			—			—
Net income (loss) attributable to SHR common shareholders	$	0.02		$	(0.04	)	$	(0.08	)	$	(0.22	)
Weighted average shares of common stock outstanding	206,767			206,523			206,163			198,872
Diluted Income (Loss) Per Share:
Income (loss) from continuing operations attributable to SHR common shareholders	$	—		$	(0.05	)	$	(0.11	)	$	(0.22	)
Loss from discontinued operations attributable to SHR common shareholders	—			—			—			—
Net income (loss) attributable to SHR common shareholders	$	—		$	(0.05	)	$	(0.11	)	$	(0.22	)
Weighted average shares of common stock outstanding	220,258			218,182			217,553			198,872




		Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)		September 30, 2013 and December 31, 2012

Consolidated Balance Sheets

(in thousands, except share data)



	September 30, 2013			December 31, 2012
Assets
Investment in hotel properties, net	$	1,915,212		$	1,970,560
Goodwill	40,359			40,359
Intangible assets, net of accumulated amortization of $12,143 and $10,812	29,185			30,631
Investment in unconsolidated affiliates	106,914			112,488
Cash and cash equivalents	79,801			80,074
Restricted cash and cash equivalents	75,183			58,579
Accounts receivable, net of allowance for doubtful accounts of $1,611 and $1,602	52,794			45,620
Deferred financing costs, net of accumulated amortization of $10,887 and $7,049	9,931			11,695
Deferred tax assets	3,027			2,203
Prepaid expenses and other assets	48,901			54,208
Total assets	$	2,361,307		$	2,406,417
Liabilities, Noncontrolling Interests and Equity
Liabilities:
Mortgages and other debt payable	$	1,162,567		$	1,176,297
Bank credit facility	137,000			146,000
Accounts payable and accrued expenses	218,410			228,397
Deferred tax liabilities	47,146			47,275
Total liabilities	1,565,123			1,597,969
Commitments and contingencies
Noncontrolling interests in SHR’s operating partnership	7,404			5,463
Equity:
SHR’s shareholders’ equity:
8.50% Series A Cumulative Redeemable Preferred Stock ($0.01 par value per share; 4,148,141 shares issued and outstanding; liquidation preference $25.00 per share plus accrued distributions and $103,704 in the aggregate)	99,995			99,995
8.25% Series B Cumulative Redeemable Preferred Stock ($0.01 par value per share; 3,615,375 shares issued and outstanding; liquidation preference $25.00 per share plus accrued distributions and $90,384 in the aggregate)	87,064			87,064
8.25% Series C Cumulative Redeemable Preferred Stock ($0.01 par value per share; 3,827,727 shares issued and outstanding; liquidation preference $25.00 per share plus accrued distributions and $95,693 in the aggregate)	92,489			92,489
Common stock ($0.01 par value per share; 350,000,000 shares of common stock authorized; 205,527,049 and 204,308,710 shares of common stock issued and outstanding)	2,055			2,043
Additional paid-in capital	1,710,267			1,730,535
Accumulated deficit	(1,244,216		)	(1,245,927		)
Accumulated other comprehensive loss	(44,896		)	(58,871		)
Total SHR’s shareholders’ equity	702,758			707,328
Noncontrolling interests in consolidated affiliates	86,022			95,657
Total equity	788,780			802,985
Total liabilities, noncontrolling interests and equity	$	2,361,307		$	2,406,417



		Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)		Three and Nine Months Ended September 30, 2013 and 2012

Investments in Unconsolidated Affiliates

(in thousands)

We have a 36.4% and 50.0% ownership interest in the Hotel del Coronado hotel and the Fairmont Scottsdale Princess hotel, respectively. We account for these investments using the equity method of accounting.



	Three Months Ended September 30, 2013									Three Months Ended September 30, 2012
	Hotel del Coronado			Fairmont Scottsdale Princess			Total			Hotel del Coronado			Fairmont Scottsdale Princess			Total
Total revenues (100%)	$	47,279		$	14,338		$	61,617		$	44,978		$	10,607		$	55,585
Property EBITDA (100%)	$	18,667		$	(302	)	$	18,365		$	14,560		$	(2,163	)	$	12,397
Equity in earnings (losses) of unconsolidated affiliates (SHR ownership)
Property EBITDA	$	6,790		$	(151	)	$	6,639		$	4,994		$	(1,082	)	$	3,912
Depreciation and amortization	(1,896		)	(1,533		)	(3,429		)	(1,711		)	(1,774		)	(3,485		)
Interest expense	(1,950		)	(195		)	(2,145		)	(2,522		)	(191		)	(2,713		)
Other expenses, net	(205		)	(16		)	(221		)	(19		)	(5		)	(24		)
Income taxes	(339		)	—			(339		)	(74		)	—			(74		)
Equity in earnings (losses) of unconsolidated affiliates	$	2,400		$	(1,895	)	$	505		$	668		$	(3,052	)	$	(2,384	)
EBITDA Contribution:
Equity in earnings (losses) of unconsolidated affiliates	$	2,400		$	(1,895	)	$	505		$	668		$	(3,052	)	$	(2,384	)
Depreciation and amortization	1,896			1,533			3,429			1,711			1,774			3,485
Interest expense	1,950			195			2,145			2,522			191			2,713
Income taxes	339			—			339			74			—			74
EBITDA Contribution	$	6,585		$	(167	)	$	6,418		$	4,975		$	(1,087	)	$	3,888
FFO Contribution:
Equity in earnings (losses) of unconsolidated affiliates	$	2,400		$	(1,895	)	$	505		$	668		$	(3,052	)	$	(2,384	)
Depreciation and amortization	1,896			1,533			3,429			1,711			1,774			3,485
FFO Contribution	$	4,296		$	(362	)	$	3,934		$	2,379		$	(1,278	)	$	1,101




	Nine Months Ended September 30, 2013									Nine Months Ended September 30, 2012
	Hotel del Coronado			Fairmont Scottsdale Princess			Total			Hotel del Coronado			Fairmont Scottsdale Princess			Total
Total revenues (100%)	$	115,367		$	69,498		$	184,865		$	110,332		$	56,735		$	167,067
Property EBITDA (100%)	$	38,487		$	14,772		$	53,259		$	33,522		$	9,743		$	43,265
Equity in earnings (losses) of unconsolidated affiliates (SHR ownership)
Property EBITDA	$	13,999		$	7,386		$	21,385		$	11,498		$	4,871		$	16,369
Depreciation and amortization	(5,647		)	(5,005		)	(10,652		)	(5,098		)	(5,321		)	(10,419		)
Interest expense	(6,384		)	(585		)	(6,969		)	(7,544		)	(589		)	(8,133		)
Other expenses, net	(228		)	(35		)	(263		)	(62		)	(44		)	(106		)
Income taxes	(276		)	—			(276		)	293			—			293
Equity in earnings (losses) of unconsolidated affiliates	$	1,464		$	1,761		$	3,225		$	(913	)	$	(1,083	)	$	(1,996	)
EBITDA Contribution
Equity in earnings (losses) of unconsolidated affiliates	$	1,464		$	1,761		$	3,225		$	(913	)	$	(1,083	)	$	(1,996	)
Depreciation and amortization	5,647			5,005			10,652			5,098			5,321			10,419
Interest expense	6,384			585			6,969			7,544			589			8,133
Income taxes	276			—			276			(293		)	—			(293		)
EBITDA Contribution	$	13,771		$	7,351		$	21,122		$	11,436		$	4,827		$	16,263
FFO Contribution
Equity in earnings (losses) of unconsolidated affiliates	$	1,464		$	1,761		$	3,225		$	(913	)	$	(1,083	)	$	(1,996	)
Depreciation and amortization	5,647			5,005			10,652			5,098			5,321			10,419
FFO Contribution	$	7,111		$	6,766		$	13,877		$	4,185		$	4,238		$	8,423



		Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)		Three and Nine Months Ended September 30, 2013 and 2012

Investments in Unconsolidated Affiliates (Continued)

(in thousands)



Debt	Interest Rate		Spread over LIBOR	Loan Amount			Maturity (a)
Hotel del Coronado
CMBS Mortgage and Mezzanine	3.83	%	365 bp	$	475,000		March 2018
Cash and cash equivalents				(8,870		)
Net Debt				$	466,130
Fairmont Scottsdale Princess
CMBS Mortgage	0.54	%	36 bp	$	133,000		April 2015
Cash and cash equivalents				(3,937		)
Net Debt				$	129,063


(a)	Includes extension options.



Caps	Effective Date	LIBOR Cap Rate		Notional Amount		Maturity
Hotel del Coronado
CMBS Mortgage and Mezzanine Loan Caps	March 2013	3.00	%	$	475,000	March 2015
Fairmont Scottsdale Princess
CMBS Mortgage Loan Cap	June 2011	4.00	%	$	133,000	December 2013




		Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)		Three and Nine Months Ended September 30, 2013 and 2012

Leasehold Information

(in thousands)



	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
Marriott Hamburg:
Property EBITDA	$	1,655		$	1,508		$	4,557		$	4,404
Revenue (a)	$	1,416		$	1,175		$	3,776		$	3,505

Lease expense	(1,202		)	(1,114		)	(3,584		)	(3,425		)
Less: Deferred gain on sale-leaseback	(52		)	(49		)	(154		)	(150		)
Adjusted lease expense	(1,254		)	(1,163		)	(3,738		)	(3,575		)

EBITDA contribution from leasehold	$	162		$	12		$	38		$	(70	)



Security Deposit (b):	September 30, 2013		December 31, 2012
Marriott Hamburg	$	2,570	$	2,507


(a)	For the three and nine months ended September 30, 2013 and 2012, Revenue for the Marriott Hamburg hotel represents lease revenue.


(b)	The security deposit is recorded in prepaid expenses and other assets on the consolidated balance sheets.




		Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)		September 30, 2013

Non-GAAP Financial Measures

We present five non-GAAP financial measures that we believe are useful to management and investors as key measures of our operating performance: Funds from Operations (FFO); FFO—Fully Diluted; Comparable FFO; Earnings Before Interest Expense, Taxes, Depreciation and Amortization (EBITDA); and Comparable EBITDA.

EBITDA represents net income (or loss) attributable to SHR common shareholders excluding: (i) interest expense, (ii) income taxes, including deferred income tax benefits and expenses applicable to our foreign subsidiaries and income taxes applicable to sale of assets; (iii) depreciation and amortization; and (iv) preferred stock dividends. EBITDA also excludes interest expense, income taxes and depreciation and amortization of our unconsolidated affiliates. EBITDA is presented on a full participation basis, which means we have assumed conversion of all redeemable noncontrolling interests of our operating partnership into our common stock. We believe this treatment of noncontrolling interests provides useful information for management and our investors and appropriately considers our current capital structure. We also present Comparable EBITDA, which eliminates the effect of realizing deferred gains on our sale leasebacks, as well as the effect of gains or losses on sales of assets, early extinguishment of debt, impairment losses, foreign currency exchange gains or losses and certain other charges that are highly variable from year to year. We believe EBITDA and Comparable EBITDA are useful to management and investors in evaluating our operating performance because they provide management and investors with an indication of our ability to incur and service debt, to satisfy general operating expenses, to make capital expenditures and to fund other cash needs or reinvest cash into our business. We also believe they help management and investors meaningfully evaluate and compare the results of our operations from period to period by removing the impact of our asset base (primarily depreciation and amortization) from our operating results. Our management also uses EBITDA and Comparable EBITDA as measures in determining the value of acquisitions and dispositions.

We compute FFO in accordance with standards established by the National Association of Real Estate Investment Trusts, or NAREIT, with the exception of impairment of depreciable real estate. NAREIT adopted a definition of FFO in order to promote an industry-wide standard measure of REIT operating performance. NAREIT defines FFO as net income (or loss) (computed in accordance with GAAP) excluding losses or gains from sales of depreciable property, impairment of depreciable real estate, real estate-related depreciation and amortization, and our portion of these items related to unconsolidated affiliates. We also present FFO—Fully Diluted, which is FFO plus income or loss on income attributable to redeemable noncontrolling interests in our operating partnership. We also present Comparable FFO, which is FFO—Fully Diluted excluding the impact of any gains or losses on early extinguishment of debt, impairment losses, foreign currency exchange gains or losses and certain other charges that are highly variable from year to year. We believe that the presentation of FFO, FFO—Fully Diluted and Comparable FFO provides useful information to management and investors regarding our results of operations because they are measures of our ability to fund capital expenditures and expand our business. In addition, FFO is widely used in the real estate industry to measure operating performance without regard to items such as depreciation and amortization. We also present Comparable FFO per diluted share as a non-GAAP measure of our performance. We calculate Comparable FFO per diluted share for a given operating period as our Comparable FFO (as defined above) divided by the weighted average of fully diluted shares outstanding, excluding shares related to the JW Marriott Essex House Hotel put option. Dilutive securities may include shares granted under share-based compensation plans and operating partnership units. No effect is shown for securities that are anti-dilutive.

We caution investors that amounts presented in accordance with our definitions of FFO, FFO—Fully Diluted, Comparable FFO, EBITDA, and Comparable EBITDA may not be comparable to similar measures disclosed by other companies, since not all companies calculate these non-GAAP measures in the same manner. FFO, FFO—Fully Diluted, Comparable FFO, EBITDA, and Comparable EBITDA should not be considered as an alternative measure of our net income (or loss) or operating performance. FFO, FFO—Fully Diluted, Comparable FFO, EBITDA, and Comparable EBITDA 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 FFO, FFO—Fully Diluted, Comparable FFO, EBITDA, and Comparable EBITDA can enhance your understanding of our financial condition and results of operations, these non-GAAP financial measures, when viewed individually, are not necessarily a better indicator of any trend as compared to comparable GAAP measures such as net income (or loss) attributable to SHR common shareholders. In addition, you should be aware that adverse economic and market conditions might negatively impact our cash flow. We have provided a quantitative reconciliation of FFO, FFO—Fully Diluted, Comparable FFO, EBITDA, and Comparable EBITDA to the most directly comparable GAAP financial performance measure, which is net income (or loss) attributable to SHR common shareholders.




		Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)		Three and Nine Months Ended September 30, 2013 and 2012

Reconciliation of Net Income (Loss) Attributable to SHR Common Shareholders to EBITDA and Comparable EBITDA

(in thousands)



	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
Net income (loss) attributable to SHR common shareholders	$	3,760		$	(8,557	)	$	(16,414	)	$	(43,071	)
Depreciation and amortization	26,244			25,649			80,459			76,416
Interest expense	21,106			19,942			63,871			58,627
Income taxes	(430		)	(600		)	1,121			215
Noncontrolling interests	29			(17		)	(22		)	(126		)
Adjustments from consolidated affiliates	(3,912		)	(1,879		)	(11,015		)	(4,382		)
Adjustments from unconsolidated affiliates	5,903			7,036			17,936			20,606
Preferred shareholder dividends	6,042			6,042			18,125			18,125
EBITDA	58,742			47,616			154,061			126,410
Realized portion of deferred gain on sale-leaseback	(52		)	(49		)	(154		)	(150		)
Loss on sale of assets—continuing operations	1,028			—			755			—
Loss on sale of assets—adjustments from consolidated affiliates	(370		)	—			(370		)	—
Impairment losses and other charges	728			—			728			—
Foreign currency exchange loss (gain)—continuing operations (a)	9			996			(177		)	1,169
Foreign currency exchange loss—discontinued operations (a)	—			—			—			535
Adjustment for Value Creation Plan	—			(2,013		)	—			2,759
Comparable EBITDA	$	60,085		$	46,550		$	154,843		$	130,723


(a)	Foreign currency exchange gains or losses applicable to third-party and inter-company debt and certain balance sheet items held by foreign subsidiaries.




		Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)		Three and Nine Months Ended September 30, 2013 and 2012

Reconciliation of Net Income (Loss) Attributable to SHR Common Shareholders to

Funds From Operations (FFO), FFO—Fully Diluted and Comparable FFO

(in thousands, except per share data)



	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2012			2013			2012
Net income (loss) attributable to SHR common shareholders	$	3,760		$	(8,557	)	$	(16,414	)	$	(43,071	)
Depreciation and amortization	26,244			25,649			80,459			76,416
Corporate depreciation	(125		)	(260		)	(383		)	(789		)
Loss on sale of assets—continuing operations	1,028			—			755			—
Realized portion of deferred gain on sale-leaseback	(52		)	(49		)	(154		)	(150		)
Noncontrolling interests adjustments	(25		)	(121		)	(277		)	(374		)
Adjustments from consolidated affiliates	(2,269		)	(859		)	(5,565		)	(2,185		)
Adjustments from unconsolidated affiliates	3,429			3,792			10,653			11,335
FFO	31,990			19,595			69,074			41,182
Redeemable noncontrolling interests	53			104			255			248
FFO—Fully Diluted	32,043			19,699			69,329			41,430
Impairment losses and other charges	728			—			728			—
Non-cash mark to market of interest rate swaps	(2,977		)	(1,688		)	(9,121		)	(4,405		)
Foreign currency exchange loss (gain)—continuing operations (a)	9			996			(177		)	1,169
Foreign currency exchange loss—discontinued operations (a)	—			—			—			535
Adjustment for Value Creation Plan	—			(2,013		)	—			2,759
Comparable FFO	$	29,803		$	16,994		$	60,759		$	41,488
Comparable FFO per fully diluted share	$	0.14		$	0.08		$	0.29		$	0.21
Weighted average diluted shares (b)	209,722			208,696			209,125			201,050


(a)	Foreign currency exchange gains or losses applicable to third-party and inter-company debt and certain balance sheet items held by foreign subsidiaries.


(b)	Excludes shares related to the JW Marriott Essex House Hotel put option.



		Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)		September 30, 2013

Debt Summary

(dollars in thousands)



Debt	Interest Rate		Spread (a)	Loan Amount		Maturity (b)
North Beach Venture	5.00	%	Fixed	$	1,476	January 2014
Marriott London Grosvenor Square (c)	3.12	%	260 bp (c)	113,367		October 2014
Bank credit facility	3.18	%	300 bp	137,000		June 2015
Four Seasons Washington, D.C.	3.33	%	315 bp	130,000		July 2016
Westin St. Francis	6.09	%	Fixed	209,588		June 2017
Fairmont Chicago	6.09	%	Fixed	93,124		June 2017
JW Marriott Essex House Hotel	4.75	%	400 bp	186,278		September 2017
Hyatt Regency La Jolla (d)	4.50% / 10.00%		400 bp / Fixed	89,367		December 2017
InterContinental Miami	3.68	%	350 bp	85,000		July 2018
Loews Santa Monica Beach Hotel	4.03	%	385 bp	109,500		July 2018
InterContinental Chicago	5.61	%	Fixed	144,867		August 2021
				$	1,299,567


(a)	Spread over LIBOR (0.18% at September 30, 2013). Interest on the JW Marriott Essex House Hotel loan is subject to a 0.75% LIBOR floor. Interest on the Hyatt Regency La Jolla loan is subject to a 0.50% LIBOR floor.


(b)	Includes extension options.

(c)

Principal balance of £70,040,000 at September 30, 2013. On August 7, 2013, the Company entered into an amendment to the mortgage loan. The amendment extended the maturity of the loan to October 2014 and waived the July 2013 and subsequent principal payments through the extended term. Pursuant to the amendment, the spread over GBP LIBOR increases in steps during the extension period from GBP LIBOR plus 2.10% in August 2013 to GBP LIBOR plus 4.25% in April 2014. The spread in the table is the spread as of September 30, 2013.


(d)	Interest on $72,000,000 is payable at LIBOR plus 4.00%, subject to a 0.50% LIBOR floor, and interest on $17,367,000 is payable at a fixed rate of 10.00%.

Domestic and European Interest Rate Swaps



Swap Effective Date	Fixed Pay Rate Against LIBOR		Notional Amount		Maturity
February 2010	4.90	%	$	100,000	September 2014
February 2010	4.96	%	100,000		December 2014
December 2010	5.23	%	100,000		December 2015
February 2011	5.27	%	100,000		February 2016
	5.09	%	$	400,000



Swap Effective Date	Fixed Pay Rate Against GBP LIBOR		Notional Amount			Maturity
October 2007	5.72	%		£	69,010	October 2013

Future scheduled debt principal payments (including extension options) are as follows:



Years ending December 31,	Amount
2013	$	948
2014	119,098
2015	143,029
2016	139,783
2017	577,550
Thereafter	319,159
	$	1,299,567

Percent of fixed rate debt including U.S. and European swaps	75.3		%
Weighted average interest rate including U.S. and European swaps (e)	6.60		%
Weighted average maturity of fixed rate debt (debt with maturity of greater than one year)	3.79

(e) Excludes the amortization of deferred financing costs and the amortization of the interest rate swap costs.



		Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)		September 30, 2013

Portfolio Data

Portfolio at September 30, 2013

(dollars in thousands)



Hotel	Location	Number of Rooms	% of Total Rooms		3rd QTR 2013 Property EBITDA			% of 3rd QTR 2013 Property EBITDA
United States:
Westin St. Francis	San Francisco, CA	1,195	14	%	$	11,688		17	%
InterContinental Chicago	Chicago, IL	792	10	%	6,939			10	%
Hotel del Coronado (a)	Coronado, CA	757	9	%	6,790			10	%
Fairmont Chicago	Chicago, IL	687	8	%	5,233			8	%
Fairmont Scottsdale Princess (b)	Scottsdale, AZ	649	8	%	(151		)	—	%
InterContinental Miami	Miami, FL	641	8	%	315			1	%
JW Marriott Essex House Hotel (c)	New York, NY	510	6	%	1,474			2	%
Hyatt Regency La Jolla (d)	La Jolla, CA	419	5	%	1,876			3	%
Ritz-Carlton Laguna Niguel	Dana Point, CA	396	5	%	9,192			14	%
Marriott Lincolnshire Resort	Lincolnshire, IL	389	5	%	736			1	%
Loews Santa Monica Beach Hotel	Santa Monica, CA	342	5	%	5,911			9	%
Ritz-Carlton Half Moon Bay	Half Moon Bay, CA	261	3	%	3,973			6	%
Four Seasons Washington, D.C.	Washington, D.C.	222	3	%	2,728			4	%
Four Seasons Silicon Valley	East Palo Alto, CA	200	2	%	2,040			3	%
Four Seasons Jackson Hole	Teton Village, WY	124	1	%	4,580			7	%
Total United States		7,584	92	%	63,324			95	%
Mexican:
Four Seasons Punta Mita Resort	Punta Mita, Mexico	173	2	%	(401		)	(1	)%
Total Mexican		173	2	%	(401		)	(1	)%
Total North American		7,757	94	%	62,923			94	%
European:
Marriott Hamburg (e)	Hamburg, Germany	278	3	%	N/A			N/A
Marriott London Grosvenor Square	London, England	237	3	%	3,963			6	%
Total European		515	6	%	3,963			6	%
		8,272	100	%	$	66,886		100	%


(a)	We account for this investment under the equity method of accounting and record equity in earnings of the unconsolidated affiliate in our consolidated statements of operations. Property EBITDA has been calculated based on our 36.4% ownership interest.


(b)	We account for this investment under the equity method of accounting and record equity in earnings of the unconsolidated affiliate in our consolidated statements of operations. Property EBITDA has been calculated based on our 50.0% ownership interest.


(c)	On September 14, 2012, we purchased a 51.0% controlling interest in the entity that owns the JW Marriott Essex House Hotel and consolidate this hotel for reporting purposes.


(d)	We own a 53.5% controlling interest in the entity that owns the Hyatt Regency La Jolla hotel and consolidate this hotel for reporting purposes.


(e)	We sublease this property and have not included it in the percentage of Property EBITDA calculation.



		Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)		Four Quarters Ended September 30, 2013

Seasonality by Geographic Region

(dollars in thousands)

Same store property revenues have been adjusted to show hotel performance on a comparable quarter-over-quarter basis. Adjustments include (i) exclusion of the unconsolidated Hotel del Coronado and Fairmont Scottsdale Princess hotel and (ii) presentation of the hotels without regard to either ownership structure or leaseholds.



United States Hotels (as of September 30, 2013)
Same store property revenues - 13 Properties and 6,178 Rooms

	Three Months Ended
	December 31, 2012			March 31, 2013			June 30, 2013			September 30, 2013			Total
Same store property revenues	201,141			179,976			225,935			222,231			829,283
Pro forma seasonality %	24.3		%	21.7		%	27.2		%	26.8		%	100.0		%


Mexican Hotel (as of September 30, 2013)
Same store property revenues - 1 Property and 173 Rooms

	Three Months Ended
	December 31, 2012			March 31, 2013			June 30, 2013			September 30, 2013			Total
Same store property revenues	$	11,261		$	13,106		$	7,518		$	5,040		$	36,925
Same store seasonality %	30.5		%	35.5		%	20.4		%	13.6		%	100.0		%


North American Hotels (as of September 30, 2013)
Same store property revenues - 14 Properties and 6,351 Rooms

	Three Months Ended
	December 31, 2012			March 31, 2013			June 30, 2013			September 30, 2013			Total
Same store property revenues	212,402			193,082			233,453			227,271			866,208
Same store seasonality %	24.5		%	22.3		%	27.0		%	26.2		%	100.0		%


European Hotels (as of September 30, 2013)
Same store property revenues - 2 Properties and 515 Rooms

	Three Months Ended
	December 31, 2012			March 31, 2013			June 30, 2013			September 30, 2013			Total
Same store property revenues	$	15,727		$	11,647		$	15,424		$	14,749		$	57,547
Same store seasonality %	27.3		%	20.3		%	26.8		%	25.6		%	100.0		%



		Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)		Three and Nine Months Ended September 30, 2013 and 2012

Operating Statistics by Geographic Region

The Total United States portfolio is derived from our hotel portfolio at September 30, 2013, consisting of all properties located in the United States, and 100% of the operations of the Hotel del Coronado and the Fairmont Scottsdale Princess hotel. The Total North American portfolio includes the Total United States portfolio and the Four Seasons Punta Mita Resort. Adjustments to the same store portfolios are the (i) exclusion of unconsolidated Hotel del Coronado and Fairmont Scottsdale Princess hotel, (ii) exclusion of the JW Marriott Essex House Hotel for the three and nine months ended September 30, 2013 and 2012 and (iii) presentation of the hotels without regard to either ownership structure or leaseholds.

Total United States Hotels (as of September 30, 2013)

15 Properties

7,584 Rooms



	Three Months Ended September 30,								Nine Months Ended September 30,
	2013			2012			Change		2013			2012			Change
ADR	$	296.68		$	276.98		7.1	%	$	283.96		$	267.67		6.1	%
Average Occupancy	80.0		%	77.7		%	2.3	pts	75.8		%	74.2		%	1.6	pts
RevPAR	$	237.23		$	215.33		10.2	%	$	215.30		$	198.53		8.4	%
Total RevPAR	$	406.77		$	374.41		8.6	%	$	392.12		$	363.08		8.0	%
Property EBITDA Margin	26.4		%	22.5		%	3.9	pts	23.9		%	21.6		%	2.3	pts

Total North American Hotels (as of September 30, 2013)

16 Properties

7,757 Rooms



	Three Months Ended September 30,								Nine Months Ended September 30,
	2013			2012			Change		2013			2012			Change
ADR	$	298.87		$	278.23		7.4	%	$	288.84		$	271.64		6.3	%
Average Occupancy	78.9		%	76.6		%	2.3	pts	75.1		%	73.4		%	1.7	pts
RevPAR	$	235.79		$	213.08		10.7	%	$	216.94		$	199.42		8.8	%
Total RevPAR	$	404.76		$	371.28		9.0	%	$	395.49		$	365.27		8.3	%
Property EBITDA Margin	25.8		%	21.8		%	4.0	pts	23.8		%	21.5		%	2.3	pts

Same Store North American Hotels (as of September 30, 2013)

13 Properties

5,841 Rooms



	Three Months Ended September 30,								Nine Months Ended September 30,
	2013			2012			Change		2013			2012			Change
ADR	$	276.05		$	257.57		7.2	%	$	270.14		$	253.42		6.6	%
Average Occupancy	81.2		%	78.5		%	2.7	pts	75.7		%	74.2		%	1.5	pts
RevPAR	$	224.09		$	202.27		10.8	%	$	204.62		$	188.04		8.8	%
Total RevPAR	$	385.01		$	354.07		8.7	%	$	372.31		$	344.87		8.0	%
Property EBITDA Margin	26.5		%	23.6		%	2.9	pts	23.8		%	22.3		%	1.5	pts

Same Store European Hotels (as of September 30, 2013)

2 Properties

515 Rooms



	Three Months Ended September 30,									Nine Months Ended September 30,
	2013			2012			Change			2013			2012			Change
ADR	$	280.13		$	298.73		(6.2	)	%	$	270.77		$	280.89		(3.6	)	%
Average Occupancy	89.4		%	86.3		%	3.1		pts	83.0		%	83.1		%	(0.1	)	pts
RevPAR	$	250.53		$	257.85		(2.8	)	%	$	224.72		$	233.45		(3.7	)	%
Total RevPAR	$	311.29		$	334.51		(6.9	)	%	$	297.45		$	309.19		(3.8	)	%
Property EBITDA Margin	38.1		%	43.5		%	(5.4	)	pts	37.4		%	39.4		%	(2.0	)	pts



		Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)		Three and Nine Months Ended September 30, 2013 and 2012

Selected Financial and Operating Information by Property

(in thousands, except operating information)

The following tables present selected financial and operating information by property for the three and nine months ended September 30, 2013 and 2012. Property EBITDA reflects property net operating income or loss plus depreciation and amortization.



	Three Months Ended September 30,								Nine Months Ended September 30,
UNITED STATES HOTELS:	2013			2012			Change		2013			2012			Change
FAIRMONT CHICAGO
Selected Financial Information:
Total revenues	$	16,844		$	16,379		2.8	%	$	44,564		$	45,243		(1.5	)	%
Property EBITDA	$	5,233		$	3,019		73.3	%	$	9,813		$	7,651		28.3		%
Selected Operating Information:
Rooms	687			687			—		687			687			—
Average occupancy	81.0		%	78.0		%	3.0	pts	71.6		%	67.9		%	3.7		pts
ADR	$	217.29		$	211.93		2.5	%	$	211.38		$	214.74		(1.6	)	%
RevPAR	$	175.94		$	165.33		6.4	%	$	151.33		$	145.70		3.9		%
Total RevPAR	$	266.51		$	259.14		2.8	%	$	237.61		$	240.35		(1.1	)	%

FAIRMONT SCOTTSDALE PRINCESS
Selected Financial Information (Amounts below are 100% of operations, of which SHR owns 50% as of September 30, 2013 and 2012, respectively):
Total revenues	$	14,338		$	10,607		35.2	%	$	69,498		$	56,735		22.5		%
Property EBITDA	$	(302	)	$	(2,163	)	86.0	%	$	14,772		$	9,743		51.6		%
Selected Operating Information:
Rooms	649			649			—		649			649			—
Average occupancy	56.8		%	51.0		%	5.8	pts	70.9		%	64.7		%	6.2		pts
ADR	$	161.87		$	147.42		9.8	%	$	236.54		$	230.01		2.8		%
RevPAR	$	91.94		$	75.18		22.3	%	$	167.68		$	148.81		12.7		%
Total RevPAR	$	240.13		$	177.65		35.2	%	$	392.25		$	319.05		22.9		%

FOUR SEASONS JACKSON HOLE
Selected Financial Information:
Total revenues	$	14,236		$	12,454		14.3	%	$	33,305		$	28,704		16.0		%
Property EBITDA	$	4,580		$	3,494		31.1	%	$	7,980		$	5,766		38.4		%
Selected Operating Information:
Rooms	124			124			—		124			124			—
Average occupancy	81.2		%	80.4		%	0.8	pts	65.8		%	67.1		%	(1.3	)	pts
ADR	$	694.47		$	607.03		14.4	%	$	621.49		$	538.63		15.4		%
RevPAR	$	563.71		$	488.10		15.5	%	$	409.07		$	361.48		13.2		%
Total RevPAR	$	1,247.89		$	1,091.69		14.3	%	$	983.83		$	844.83		16.5		%

FOUR SEASONS SILICON VALLEY
Selected Financial Information:
Total revenues	$	9,130		$	8,082		13.0	%	$	26,329		$	24,107		9.2		%
Property EBITDA	$	2,040		$	1,494		36.5	%	$	5,729		$	5,119		11.9		%
Selected Operating Information:
Rooms	200			200			—		200			200			—
Average occupancy	85.4		%	81.3		%	4.1	pts	81.3		%	76.0		%	5.3		pts
ADR	$	337.39		$	305.76		10.3	%	$	333.23		$	314.66		5.9		%
RevPAR	$	288.19		$	248.71		15.9	%	$	270.89		$	238.99		13.3		%
Total RevPAR	$	496.18		$	439.22		13.0	%	$	482.21		$	439.91		9.6		%



		Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)		Three and Nine Months Ended September 30, 2013 and 2012



	Three Months Ended September 30,									Nine Months Ended September 30,
	2013			2012			Change			2013			2012			Change
FOUR SEASONS WASHINGTON, D.C.
Selected Financial Information:
Total revenues	$	14,448		$	13,639		5.9		%	$	48,827		$	45,526		7.3		%
Property EBITDA	$	2,728		$	2,435		12.0		%	$	11,066		$	9,518		16.3		%
Selected Operating Information:
Rooms	222			222			—			222			222			—
Average occupancy	70.0		%	67.0		%	3.0		pts	72.1		%	72.0		%	0.1		pts
ADR	$	496.82		$	478.96		3.7		%	$	559.21		$	512.89		9.0		%
RevPAR	$	347.65		$	320.67		8.4		%	$	403.15		$	369.46		9.1		%
Total RevPAR	$	707.41		$	667.78		5.9		%	$	805.64		$	748.44		7.6		%

HOTEL DEL CORONADO
Selected Financial Information (Amounts below are 100% of operations, of which SHR owns 36.4% and 34.3% as of September 30, 2013 and 2012, respectively):
Total revenues	$	47,279		$	44,978		5.1		%	$	115,367		$	110,332		4.6		%
Property EBITDA	$	18,667		$	14,560		28.2		%	$	38,487		$	33,522		14.8		%
Selected Operating Information:
Rooms	757			757			—			757			757			—
Average occupancy	80.5		%	77.2		%	3.3		pts	70.3		%	69.7		%	0.6		pts
ADR	$	463.30		$	463.44		—		%	$	391.59		$	385.59		1.6		%
RevPAR	$	372.82		$	357.75		4.2		%	$	275.09		$	268.75		2.4		%
Total RevPAR	$	678.87		$	645.83		5.1		%	$	558.24		$	531.93		4.9		%

HYATT REGENCY LA JOLLA
Selected Financial Information:
Total revenues	$	8,673		$	8,946		(3.1	)	%	$	25,674		$	27,358		(6.2	)	%
Property EBITDA	$	1,876		$	1,785		5.1		%	$	5,087		$	5,883		(13.5	)	%
Selected Operating Information:
Rooms	419			419			—			419			419			—
Average occupancy	82.1		%	80.0		%	2.1		pts	75.0		%	77.3		%	(2.3	)	pts
ADR	$	174.90		$	173.34		0.9		%	$	171.94		$	168.57		2.0		%
RevPAR	$	143.61		$	138.67		3.6		%	$	128.86		$	130.36		(1.2	)	%
Total RevPAR	$	225.00		$	232.06		(3.0	)	%	$	224.45		$	238.30		(5.8	)	%

INTERCONTINENTAL CHICAGO
Selected Financial Information:
Total revenues	$	21,688		$	20,962		3.5		%	$	56,590		$	54,062		4.7		%
Property EBITDA	$	6,939		$	6,511		6.6		%	$	13,383		$	12,419		7.8		%
Selected Operating Information:
Rooms	792			792			—			792			792			—
Average occupancy	90.1		%	87.2		%	2.9		pts	77.7		%	76.6		%	1.1		pts
ADR	$	199.38		$	194.58		2.5		%	$	197.24		$	189.77		3.9		%
RevPAR	$	179.70		$	169.62		5.9		%	$	153.28		$	145.33		5.5		%
Total RevPAR	$	297.65		$	287.68		3.5		%	$	261.73		$	249.13		5.1		%



		Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)		Three and Nine Months Ended September 30, 2013 and 2012



	Three Months Ended September 30,									Nine Months Ended September 30,
	2013			2012			Change			2013			2012			Change
INTERCONTINENTAL MIAMI
Selected Financial Information:
Total revenues	$	10,144		$	8,690		16.7		%	$	47,302		$	40,793		16.0		%
Property EBITDA	$	315		$	(124	)	354.0		%	$	13,245		$	10,383		27.6		%
Selected Operating Information:
Rooms	641			641			—			641			641			—
Average occupancy	70.5		%	64.7		%	5.8		pts	81.1		%	76.9		%	4.2		pts
ADR	$	138.51		$	129.46		7.0		%	$	188.45		$	170.88		10.3		%
RevPAR	$	97.62		$	83.78		16.5		%	$	152.82		$	131.36		16.3		%
Total RevPAR	$	172.03		$	147.35		16.7		%	$	270.31		$	232.26		16.4		%

JW MARRIOTT ESSEX HOUSE HOTEL
Selected Financial Information (This table includes financial information only for our period of ownership):
Total revenues	$	20,380		N/A			N/A			$	59,686		N/A			N/A
Property EBITDA	$	1,474		N/A			N/A			$	5,022		N/A			N/A
Selected Operating Information (This table includes statistical information only for our period of ownership. For the three months ended September 30, 2012, average occupancy was 87.7%, ADR was $354.64, RevPAR was $310.95 and Total RevPAR was $411.99. For the nine months ended September 30, 2012, average occupancy was 81.4%, ADR was $362.49, RevPAR was $295.19 and Total RevPAR was $411.37.):
Rooms	510			N/A			N/A			510			N/A			N/A
Average occupancy	78.6		%	N/A			N/A			80.3		%	N/A			N/A
ADR	$	444.61		N/A			N/A			$	414.82		N/A			N/A
RevPAR	$	349.29		N/A			N/A			$	333.04		N/A			N/A
Total RevPAR	$	433.51		N/A			N/A			$	423.34		N/A			N/A

LOEWS SANTA MONICA BEACH HOTEL
Selected Financial Information:
Total revenues	$	16,100		$	15,263		5.5		%	$	41,178		$	39,979		3.0		%
Property EBITDA	$	5,911		$	5,406		9.3		%	$	12,420		$	11,904		4.3		%
Selected Operating Information:
Rooms	342			342			—			342			342			—
Average occupancy	92.3		%	95.0		%	(2.7	)	pts	87.1		%	90.2		%	(3.1	)	pts
ADR	$	405.49		$	375.26		8.1		%	$	350.37		$	328.38		6.7		%
RevPAR	$	374.43		$	356.37		5.1		%	$	305.22		$	296.10		3.1		%
Total RevPAR	$	511.71		$	485.11		5.5		%	$	441.04		$	426.64		3.4		%

MARRIOTT LINCOLNSHIRE RESORT
Selected Financial Information:
Total revenues	$	8,579		$	8,359		2.6		%	$	23,609		$	21,692		8.8		%
Property EBITDA	$	736		$	1,011		(27.2	)	%	$	991		$	803		23.4		%
Selected Operating Information:
Rooms	389			389			—			389			389			—
Average occupancy	66.3		%	70.6		%	(4.3	)	pts	52.7		%	61.0		%	(8.3	)	pts
ADR	$	134.68		$	121.55		10.8		%	$	132.49		$	122.35		8.3		%
RevPAR	$	89.26		$	85.79		4.0		%	$	69.79		$	74.62		(6.5	)	%
Total RevPAR	$	239.72		$	255.80		(6.3	)	%	$	219.89		$	221.29		(0.6	)	%



		Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)		Three and Nine Months Ended September 30, 2013 and 2012



	Three Months Ended September 30,									Nine Months Ended September 30,
	2013			2012			Change			2013			2012			Change
RITZ-CARLTON HALF MOON BAY
Selected Financial Information:
Total revenues	$	16,792		$	16,128		4.1		%	$	45,973		$	43,037		6.8		%
Property EBITDA	$	3,973		$	4,009		(0.9	)	%	$	8,778		$	9,082		(3.3	)	%
Selected Operating Information:
Rooms	261			261			—			261			261			—
Average occupancy	73.4		%	72.6		%	0.8		pts	68.7		%	66.2		%	2.5		pts
ADR	$	463.48		$	424.87		9.1		%	$	411.97		$	385.88		6.8		%
RevPAR	$	340.21		$	308.59		10.2		%	$	283.03		$	255.28		10.9		%
Total RevPAR	$	699.30		$	671.66		4.1		%	$	645.21		$	601.79		7.2		%

RITZ-CARLTON LAGUNA NIGUEL
Selected Financial Information:
Total revenues	$	26,035		$	23,534		10.6		%	$	66,939		$	59,125		13.2		%
Property EBITDA	$	9,192		$	8,165		12.6		%	$	20,904		$	18,535		12.8		%
Selected Operating Information:
Rooms	396			396			—			396			396			—
Average occupancy	79.7		%	77.0		%	2.7		pts	71.4		%	67.3		%	4.1		pts
ADR	$	473.16		$	440.96		7.3		%	$	410.39		$	385.75		6.4		%
RevPAR	$	377.02		$	339.65		11.0		%	$	292.97		$	259.54		12.9		%
Total RevPAR	$	714.61		$	645.97		10.6		%	$	619.18		$	544.91		13.6		%

WESTIN ST. FRANCIS
Selected Financial Information:
Total revenues	$	39,181		$	32,975		18.8		%	$	108,169		$	97,532		10.9		%
Property EBITDA	$	11,688		$	8,466		38.1		%	$	26,789		$	21,863		22.5		%
Selected Operating Information:
Rooms	1,195			1,195			—			1,195			1,195			—
Average occupancy	93.1		%	88.5		%	4.6		pts	87.0		%	82.9		%	4.1		pts
ADR	$	258.43		$	232.74		11.0		%	$	243.06		$	227.40		6.9		%
RevPAR	$	240.59		$	205.86		16.9		%	$	211.44		$	188.53		12.2		%
Total RevPAR	$	356.39		$	299.93		18.8		%	$	331.57		$	297.87		11.3		%



		Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)		Three and Nine Months Ended September 30, 2013 and 2012



	Three Months Ended September 30,									Nine Months Ended September 30,
MEXICAN HOTEL:	2013			2012			Change			2013			2012			Change
FOUR SEASONS PUNTA MITA RESORT
Selected Financial Information:
Total revenues	$	5,040		$	3,755		34.2		%	$	25,664		$	21,838		17.5		%
Property EBITDA	$	(401	)	$	(1,090	)	63.2		%	$	5,344		$	3,744		42.7		%
Selected Operating Information:
Rooms	173			173			—			173			173			—
Average occupancy	32.1		%	26.6		%	5.5		pts	43.7		%	40.5		%	3.2		pts
ADR	$	537.75		$	436.74		23.1		%	$	661.08		$	587.82		12.5		%
RevPAR	$	172.62		$	115.96		48.9		%	$	288.84		$	237.86		21.4		%
Total RevPAR	$	316.67		$	235.93		34.2		%	$	543.40		$	460.71		17.9		%

EUROPEAN HOTELS:
MARRIOTT HAMBURG
Selected Financial Information:
Total revenues	$	5,889		$	5,491		7.2		%	$	16,232		$	15,770		2.9		%
Property EBITDA	$	1,655		$	1,508		9.7		%	$	4,557		$	4,404		3.5		%
Selected Operating Information:
Rooms	278			278			—			278			278			—
Average occupancy	91.2		%	88.2		%	3.0		pts	83.3		%	82.5		%	0.8		pts
ADR	$	195.49		$	183.19		6.7		%	$	189.81		$	182.81		3.8		%
RevPAR	$	178.29		$	161.66		10.3		%	$	158.16		$	150.85		4.8		%
Total RevPAR	$	230.25		$	214.70		7.2		%	$	213.88		$	207.04		3.3		%

MARRIOTT LONDON GROSVENOR SQUARE
Selected Financial Information:
Total revenues	$	8,860		$	10,358		(14.5	)	%	$	25,588		$	27,859		(8.2	)	%
Property EBITDA	$	3,963		$	5,382		(26.4	)	%	$	11,072		$	12,795		(13.5	)	%
Selected Operating Information:
Rooms	237			237			—			237			237			—
Average occupancy	87.4		%	84.1		%	3.3		pts	82.6		%	83.8		%	(1.2	)	pts
ADR	$	383.79		$	441.02		(13.0	)	%	$	366.58		$	394.14		(7.0	)	%
RevPAR	$	335.28		$	370.69		(9.6	)	%	$	302.79		$	330.34		(8.3	)	%
Total RevPAR	$	406.35		$	475.06		(14.5	)	%	$	395.48		$	429.01		(7.8	)	%



		Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)		Three and Nine Months Ended September 30, 2013 and 2012

Reconciliation of Property EBITDA to EBITDA

(in thousands)



	Three Months Ended September 30,												Nine Months Ended September 30,
	2013						2012						2013					2012
Hotel	Property EBITDA			EBITDA			Property EBITDA			EBITDA			Property EBITDA		EBITDA			Property EBITDA		EBITDA
Fairmont Chicago	$	5,233		$	5,233		$	3,019		$	3,019		$	9,813	$	9,813		$	7,651	$	7,651
Fairmont Scottsdale Princess (a)	(302		)	—			(2,163		)	—			14,772		—			9,743		—
Four Seasons Jackson Hole	4,580			4,580			3,494			3,494			7,980		7,980			5,766		5,766
Four Seasons Silicon Valley	2,040			2,040			1,494			1,494			5,729		5,729			5,119		5,119
Four Seasons Washington, D.C.	2,728			2,728			2,435			2,435			11,066		11,066			9,518		9,518
Hotel del Coronado (a)	18,667			—			14,560			—			38,487		—			33,522		—
Hyatt Regency La Jolla	1,876			1,876			1,785			1,785			5,087		5,087			5,883		5,883
InterContinental Chicago	6,939			6,939			6,511			6,511			13,383		13,383			12,419		12,419
InterContinental Miami	315			315			(124		)	(124		)	13,245		13,245			10,383		10,383
JW Marriott Essex House Hotel (b)	1,474			1,474			—			916			5,022		5,022			—		916
Loews Santa Monica Beach Hotel	5,911			5,911			5,406			5,406			12,420		12,420			11,904		11,904
Marriott Lincolnshire Resort	736			736			1,011			1,011			991		991			803		803
Ritz-Carlton Half Moon Bay	3,973			3,973			4,009			4,009			8,778		8,778			9,082		9,082
Ritz-Carlton Laguna Niguel	9,192			9,192			8,165			8,165			20,904		20,904			18,535		18,535
Westin St. Francis	11,688			11,688			8,466			8,466			26,789		26,789			21,863		21,863
Four Seasons Punta Mita Resort	(401		)	(401		)	(1,090		)	(1,090		)	5,344		5,344			3,744		3,744
Marriott Hamburg (c)	1,655			214			1,508			61			4,557		192			4,404		80
Marriott London Grosvenor Square	3,963			3,963			5,382			5,382			11,072		11,072			12,795		12,795
	$	80,267		$	60,461		$	63,868		$	50,940		$	215,439	$	157,815		$	183,134	$	136,461
Adjustments:
Impairment losses and other charges				(728		)				—					(728		)			—
Corporate expenses				(5,487		)				(6,956		)			(18,880		)			(23,632		)
Interest income				12						42					45					122
Equity in earnings (losses) of unconsolidated affiliates				451						(2,257		)			3,252					(2,054		)
Foreign currency exchange (loss) gain				(9		)				(996		)			177					(1,169		)
Other (expenses) income, net				(832		)				436					45					1,365
Loss from discontinued operations				—						—					—					(535		)
Noncontrolling interest in consolidated affiliates				3,018						1,241					7,467					891
Adjustments from consolidated affiliates				(3,912		)				(1,879		)			(11,015		)			(4,382		)
Adjustments from unconsolidated affiliates				5,903						7,036					17,936					20,606
Other adjustments				(135		)				9					(2,053		)			(1,263		)
EBITDA				$	58,742					$	47,616				$	154,061				$	126,410


(a)	We account for these properties under the equity method of accounting. Therefore, EBITDA related to our interest in these properties is reflected in adjustments from unconsolidated affiliates. Property EBITDA represents 100% of revenue and expenses generated by these properties.


(b)	On September 14, 2012, we purchased a 51% controlling interest in this hotel. We have not included the results of this hotel in Property EBITDA for the three and nine months ended September 30, 2012 above since we did not own the property for the entire period.


(c)	We have a leasehold interest in and sublease this property. Therefore, EBITDA represents the lease revenue less the lease expense recorded in our statements. Property EBITDA represents the revenue less expenses generated by the property.



		Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)		Three and Nine Months Ended September 30, 2013 and 2012

Reconciliation of Property EBITDA to Comparable EBITDA

(in thousands)



	Three Months Ended September 30, 2013									Nine Months Ended September 30, 2013
	Property EBITDA			Adjustments			Comparable EBITDA			Property EBITDA		Adjustments			Comparable EBITDA
Urban Hotels:
Fairmont Chicago	$	5,233		$	—		$	5,233		$	9,813	$	—		$	9,813
Four Seasons Silicon Valley	2,040			—			2,040			5,729		—			5,729
Four Seasons Washington, D.C.	2,728			—			2,728			11,066		—			11,066
Hyatt Regency La Jolla	1,876			(872		)	1,004			5,087		(2,365		)	2,722
InterContinental Chicago	6,939			—			6,939			13,383		—			13,383
InterContinental Miami	315			—			315			13,245		—			13,245
JW Marriott Essex House Hotel	1,474			(722		)	752			5,022		(2,461		)	2,561
Westin St. Francis	11,688			—			11,688			26,789		—			26,789
Total Urban Hotels	32,293			(1,594		)	30,699			90,134		(4,826		)	85,308
Resorts:
Fairmont Scottsdale Princess	(302		)	135			(167		)	14,772		(7,421		)	7,351
Four Seasons Jackson Hole	4,580			—			4,580			7,980		—			7,980
Four Seasons Punta Mita Resort	(401		)	—			(401		)	5,344		—			5,344
Hotel del Coronado	18,667			(12,082		)	6,585			38,487		(24,716		)	13,771
Loews Santa Monica Beach Hotel	5,911			—			5,911			12,420		—			12,420
Marriott Lincolnshire Resort	736			—			736			991		—			991
Ritz-Carlton Half Moon Bay	3,973			—			3,973			8,778		—			8,778
Ritz-Carlton Laguna Niguel	9,192			—			9,192			20,904		—			20,904
Total Resorts	42,356			(11,947		)	30,409			109,676		(32,137		)	77,539
European Hotels:
Marriott Hamburg	1,655			(1,493		)	162			4,557		(4,519		)	38
Marriott London Grosvenor Square	3,963			—			3,963			11,072		—			11,072
Total European Hotels	5,618			(1,493		)	4,125			15,629		(4,519		)	11,110
	$	80,267		$	(15,034	)	$	65,233		$	215,439	$	(41,482	)	$	173,957

	% of QTR Comparable EBITDA									% of YTD Comparable EBITDA
Urban Hotels	47					%				49				%
Resorts	47					%				45				%
European Hotels	6					%				6				%
Total	100					%				100				%



Total North American Urban Hotels (as of September 30, 2013)
8 Properties
4,666 Rooms
	Three Months Ended September 30,								Nine Months Ended September 30,
	2013			2012			Change		2013			2012			Change
ADR	$	252.62		$	231.38		9.2	%	$	254.35		$	237.61		7.0	%
Average Occupancy	83.7		%	81.2		%	2.5	pts	79.6		%	77.3		%	2.3	pts
RevPAR	$	211.43		$	187.80		12.6	%	$	202.39		$	183.64		10.2	%
Total RevPAR	$	327.20		$	298.74		9.5	%	$	327.02		$	306.13		6.8	%
Property EBITDA Margin	23.0		%	18.6		%	4.4	pts	21.6		%	18.6		%	3.0	pts

Total North American Resorts (as of September 30, 2013)
8 Properties
3,091 Rooms
	Three Months Ended September 30,								Nine Months Ended September 30,
	2013			2012			Change		2013			2012			Change
ADR	$	380.42		$	360.20		5.6	%	$	349.44		$	330.70		5.7	%
Average Occupancy	71.6		%	69.7		%	1.9	pts	68.4		%	67.5		%	0.9	pts
RevPAR	$	272.57		$	251.08		8.6	%	$	238.91		$	223.34		7.0	%
Total RevPAR	$	521.85		$	480.26		8.7	%	$	498.85		$	454.98		9.6	%
Property EBITDA Margin	28.5		%	24.7		%	3.8	pts	26.0		%	24.4		%	1.6	pts



		Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)		September 30, 2013

2013 Guidance

(in millions, except per share data)



	Year Ended December 31, 2013
Operational Guidance	Low Range		High Range
North American same store Total RevPAR growth (a)	6.5	%	7.0	%
North American same store RevPAR growth (a)	7.5	%	8.0	%


(a)	Includes North American hotels which are consolidated in our financial results, but excludes the JW Marriott Essex House Hotel, which was acquired in 2012.



	Year Ended December 31, 2013
Comparable EBITDA Guidance	Low Range			High Range
Net loss attributable to common shareholders	$	(30.5	)	$	(20.5	)
Depreciation and amortization	113.2			113.2
Interest expense	87.2			87.2
Income taxes	1.5			1.5
Noncontrolling interests	(0.1		)	(0.1		)
Adjustments from consolidated affiliates	(15.2		)	(15.2		)
Adjustments from unconsolidated affiliates	23.9			23.9
Preferred shareholder dividends	24.2			24.2
Realized portion of deferred gain on sale-leasebacks	(0.2		)	(0.2		)
Loss on sale of asset	0.8			0.8
Impairment losses and other charges	0.7			0.7
Other adjustments	(0.5		)	(0.5		)
Comparable EBITDA	$	205.0		$	215.0



	Year Ended December 31, 2013
Comparable FFO Guidance	Low Range			High Range
Net loss attributable to common shareholders	$	(30.5	)	$	(20.5	)
Depreciation and amortization	112.5			112.5
Realized portion of deferred gain on sale-leasebacks	(0.2		)	(0.2		)
Loss on sale of asset	0.8			0.8
Noncontrolling interests	—			—
Adjustments from consolidated affiliates	(7.9		)	(7.9		)
Adjustments from unconsolidated affiliates	14.4			14.4
Impairment losses and other charges	0.7			0.7
Other adjustments	(9.3		)	(9.3		)
Comparable FFO	$	80.5		$	90.5
Comparable FFO per diluted share	$	0.38		$	0.43

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