ASHFORD HOSPITALITY TRUST INC
For the period ended Mar 31, 2026. Filed May 14, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2026 · Filed May 14, 2026
AHT$2.37-2.5%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-09-30; filed 2025-11-13.
0001232582-25-000167
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCurrent report: 10-Q
Period ended 2026-03-31; filed 2026-05-14.
0001232582-26-000118
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 219 previous paragraphs and 199 current paragraphs.
109 unchanged; 55 reworded; 31 added; 46 removed; 9 previous and 4 current paragraphs rearranged.
Tables are not compared: 9 previous and 8 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (31)
Current report
•our ability to continue as a going concern as described in our financial statement footnotes and generate sufficient liquidity to satisfy our obligations as they become due;
Current report
•changes in our dividend policy;
Current report
•our preferred stock purchase rights could hinder the market for our common stock; and
Current report
On January 13, 2026, the Company extended its Highland mortgage loan secured by 18 hotels. As a condition to the extension, the loan was paid down by $10 million to a current balance of $723.6 million, or approximately 65% of appraised value, and has a final maturity date of July 9, 2026.
Current report
On January 13, 2026, the Company announced that, to preserve the Company’s liquidity position as it evaluates strategic alternatives, preferred dividends have been suspended, including dividends previously declared for recordholders of the Company’s Series D, F, G, H, I, J, K, L and M preferred stock as of December 31, 2025, and payable on January 15, 2026. We intend to pay the previously declared but unpaid dividends as soon as reasonably practicable. Any accrued but unpaid dividends will accrue in accordance with the terms outlined in the applicable governing documents for each series of preferred stock. We will continue to evaluate potential future dividends on a quarterly basis.
Current report
On February 11, 2026, the Company received a notice of default and acceleration from the lender relating to the Company’s mortgage loan on the JPM8 hotel properties. The notice followed the Company’s failure on February 9, 2026 to make certain required payments and deliver required documentation under the existing loan extension, which constituted an event of default under the loan agreement. As a result, the lender demanded immediate payment of the outstanding principal balance of $325 million, plus accrued interest, default interest, fees, and other amounts due, and also required delivery of a replacement interest rate cap agreement. The loan is secured by eight hotel properties. The notice does not trigger any cross‑defaults under other loans of the Company’s subsidiaries, and the Company has no indebtedness at the parent‑company level.
Current report
Effective February 24, 2026, Sonny Sra retired from the Company’s board of directors due to health reasons.
Current report
On March 5, 2026, Ashford Inc. and Ashford LLC agreed with Deric Eubanks, the Chief Financial Officer of Ashford Inc., and Ashford LLC that, effective March 31, 2026 (the “Termination Date”), Mr. Eubanks would terminate employment with and service to Ashford Inc., Ashford LLC and their affiliates. Mr. Eubanks was also the Chief Financial Officer of the Company and Braemar and accordingly his service as Chief Financial Officer of each of the Company and Braemar ended effective as of the Termination Date. Effective on the Termination Date, Justin Coe, the Company’s Chief Accounting Officer and principal accounting officer, assumed the role of principal financial officer of the Company.
Current report
On March 5, 2026, the Company completed the sale of the 333-room Hilton St. Petersburg Bayfront located in St. Petersburg, Florida for $96 million, subject to customary pro rations and adjustments.
Current report
On March 13, 2026, we entered into a Limited Waiver Under Advisory Agreement with Ashford Inc. and Ashford LLC (the “2026 Advisory Agreement Limited Waiver”). Pursuant to the 2026 Advisory Agreement Limited Waiver, the Company, the Operating Partnership, TRS, Ashford Inc. and Ashford LLC waived the operation of any provision in our advisory agreement that would otherwise limit the ability of the Company in its discretion, at the Company’s cost and expense, to award during calendar year 2026, cash incentive compensation to employees and other representatives of Ashford Inc. and Ashford LLC.
Current report
On March 16, 2026, the Company entered into a definitive agreement to sell the 168-room Lakeway Resort & Spa located in Austin, Texas for a purchase price of $37.8 million. The agreement included a nonrefundable deposit of $500,000 which was paid on March 16, 2026.
Current report
On March 17, 2026, the Company completed the sale of the 157-room La Posada de Santa Fe located in Santa Fe, New Mexico for a purchase price of $57.5 million, subject to customary pro rations and adjustments.
Current report
On March 27, 2026, the Company entered into the Advisory Agreement with Ashford Inc. and Ashford LLC. The Advisory Agreement amends and restates the terms of the Third Amended and Restated Advisory Agreement, dated as of March 12, 2024 and extends the initial term of the Advisory Agreement to December 31, 2055 with two 20-year possible extensions. See note 13 in our consolidated financial statements.
Current report
On March 31, 2026, the Company completed the sale of the 252-room Hilton Alexandria Old Town located in Alexandria, Virginia for a purchase price of $58.0 million, subject to customary pro rations and adjustments.
Current report
On April 7, 2026, the Company completed the sale of the 160-room Embassy Suites Palm Beach Gardens located in Palm Beach Gardens, Florida for a purchase price of $41.0 million, subject to customary pro rations and adjustments.
Current report
On April 8, 2026, the Company entered into a definitive agreement to sell the 358-room Hyatt Regency Long Island located in Hauppauge, New York for a purchase price of $26.1 million. The agreement included a nonrefundable deposit of $500,000 which was paid on April 13, 2026.
Current report
On April 8, 2026, the Company entered into a definitive agreement to sell the 144-room Silversmith Hotel located in Chicago, Illinois for a purchase price of $16.0 million. The agreement included a nonrefundable deposit of $200,000 which was paid on April 17, 2026.
Current report
On April 16, 2026, the Company entered into a definitive agreement to sell the 119-room Hilton Garden Inn Jacksonville located in Jacksonville, Florida for a purchase price of $11.3 million. The agreement included a nonrefundable deposit of $1.1 million which was paid on April 17, 2026.
Current report
On May 1, 2026, a $1.0 million nonrefundable deposit was paid by the buyer as part of a definitive agreement the Company entered into on March 26, 2026, to sell the 260-room Sheraton San Diego Mission Valley located in San Diego, California for a purchase price of $45.3 million.
Current report
On May 6, 2026, the Company entered into a definitive agreement to sell the 378-room Sheraton Indianapolis City Centre located in Indianapolis, Indiana for a purchase price of $18.5 million. The agreement included a nonrefundable deposit of $641,000 which was paid on May 8, 2026.
Current report
Impairment Charges. Impairment charges were $112.6 million in the 2026 quarter and $0 in 2025. In the 2026 quarter, we recorded impairment charges on nine properties. The impairment charges were a result of reduced estimated future cash flows resulting from reductions to the expected holding periods of the hotel properties. The impairment charges for four properties were based on a market approach methodology which compares the net book value of the assets to their fair market value. The impairment charge for the remaining five properties were based on the income approach which utilized a discounted cash flow methodology, supported by the market approach. See note 5 to our consolidated financial statements.
Current report
Other Income (Expense). In the 2026 quarter and the 2025 quarter, we recorded other income of $3.2 million and $0, respectively. The income in the 2026 quarter was from the sale of historical tax credits related to the Le Pavillon hotel which were sold subsequent to the sale of the property in December 2025.
Current report
Income Tax (Expense) Benefit. Income tax expense increased $435,000, from income tax expense of $317,000 in the 2025 quarter to income tax expense of $752,000 in the 2026 quarter. The increase in income tax expense in the 2026 quarter was primarily attributable to an increase in the income of our TRS entities.
Current report
As described in note 2 to our consolidated financial statements, the Company forecasts it may not have enough cash to support the Company’s daily operations one year from the date the financial statements are issued due primarily to anticipated debt service costs, debt maturities and the potential termination fee the Company would owe to Ashford LLC upon the triggering of the change of control provision in the Advisory Agreement. We have$1.9 billion of non-recourse loans that mature within one year from the date the financial statements are issued. If our lenders elect not to refinance these loans and foreclose on these properties and the Company’s Annualized Portfolio Cash Flow (as defined in the Advisory Agreement) is below $65 million, the change of control provision in the Advisory Agreement could be triggered at Ashford LLC’s discretion within one year from the date the financial statements are issued, resulting in a termination fee. See discussion in note 13 to our consolidated financial statements.
Current report
We are taking several steps to reduce our cash utilization and potentially raise additional capital. The Company’s ability to continue as a going concern is dependent upon its ability to improve the profitability of its operations, refinance or extend the maturity of our loans and increase our cash position from the sale of certain hotel properties. While the Company believes in the viability of its strategy, GAAP requires that in making this determination the Company cannot consider any remedies outside of the Company’s control which have not been fully implemented. As such, the Company could not consider future potential fundraising activities, whether through equity or debt offerings or dispositions of hotel properties as we could not conclude they were probable of being effectively implemented.
Current report
Based on these factors, the Company has determined that there is substantial doubt about the Company’s ability to continue as a going concern within one year after the date the financial statements are issued. The consolidated financial statements have been prepared assuming that the Company will continue as a going concern and do not include any adjustments that might result from the outcome of this uncertainty.
Current report
Pursuant to the Advisory Agreement between us and our advisor, we must pay our advisor on a monthly basis a base management fee, subject to a minimum base management fee. The minimum base management fee is equal to the greater of: (i) 90% of the base fee paid for the same month in the prior fiscal year; and (ii) 1/12th of the “G&A Ratio” for the most recently completed fiscal quarter multiplied by our total market capitalization on the last balance sheet date included in the most recent quarterly report on Form 10-Q or annual report on Form 10-K that we file with the SEC. Thus, even if our total market capitalization and performance decline, we will still be required to make payments to our advisor equal to the minimum base management fee, which could adversely impact our liquidity and financial condition.
Current report
Other Loan Activity
Current report
On January 13, 2026, the Company extended its Highland mortgage loan secured by 18 hotels. As a condition to the extension, the loan was paid down by $10 million to a current balance of $723.6 million, or approximately 65% of appraised value, and has a final maturity date of July 9, 2026.
Current report
On February 11, 2026, the Company received a notice of default and acceleration from the lender relating to the Company’s mortgage loan on the JPM8 hotel properties. The notice followed the Company’s failure on February 9, 2026 to make certain required payments and deliver required documentation under the existing loan extension, which constituted an event of default under the loan agreement. As a result, the lender demanded immediate payment of the outstanding principal balance of $325 million, plus accrued interest, default interest, fees, and other amounts due, and also required delivery of a replacement interest rate cap agreement. The loan is secured by eight hotel properties. The notice does not trigger any cross‑defaults under other loans of the Company’s subsidiaries, and the Company has no indebtedness at the parent‑company level.
Current report
Net cash flows provided by investing activities for the three months ended March 31, 2026 excluded $24.1 million of net proceeds from the sale of the Hilton Alexandria Old Town that was completed on March 31, 2026. The proceeds were recorded in prepaid expenses and other assets on the Company’s consolidated balance sheet at March 31, 2026 and subsequently received in April 2026.
Removed paragraphs (46)
Previous report
Pursuant to a contribution agreement with Ashford Securities, we, our Advisor and other entities advised by our Advisor contribute capital to Ashford Securities to fund a portion of its operations. Ashford Securities currently distributes our Series L Preferred Stock and Series M Preferred Stock and interests in private funds sponsored by our Advisor.
Previous report
On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S. The OBBBA includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. The tax provisions in the OBBBA did not have a material impact on our consolidated financial statements.
Previous report
On July 30, 2025, the Company extended its Highland mortgage loan secured by 18 hotels with an original maturity date of April 2025. Terms of the amendment included a $10.0 million principal paydown, extending the maturity date to January 9, 2026. The loan is subject to a six-month extension option to July 9, 2026, upon satisfaction of certain conditions, and bears interest at a floating rate of SOFR + 4.13%.
Previous report
On August 11, 2025, the Company completed the sale of the 78-room Residence Inn Evansville located in Evansville, Indiana for $6.0 million, subject to customary pro rations and adjustments.
Previous report
On August 14, 2025, the Company and Ashford LLC entered into Amendment No. 5 to the Advisory Agreement (the “Fifth Amendment”). The Fifth Amendment extends the outside date for which any sale or disposition of any of the Company’s Highland Portfolio and JPM8 hotel properties securing the associated mortgage loans following an event of default (as defined in the Advisory Agreement) would be excluded from the numerator of the calculation of the percentage of gross book value of the Company’s assets sold or disposed (but, for the avoidance of doubt, included in the denominator of such calculation) for purposes of determining whether a Company Change of Control (as defined in the Advisory Agreement) has occurred, from May 31, 2026 to August 15, 2026. On November 10, 2025, the parties entered into Amendment No. 6 to the Advisory Agreement. See below.
Previous report
On August 14, 2025, Ashford Trust OP executed a promissory note with Ashford LLC allowing Ashford Trust OP to draw up to $20 million in cash through August 15, 2026 to fund certain permitted costs (as defined in the promissory note). Funds advanced under the promissory note bear interest at an annual rate of 10.0% which may be paid in cash or paid in-kind at Ashford OP’s discretion. The maturity date of the promissory note was August 15, 2026, at which time all principal drawn upon and outstanding interest would have been due and payable. As collateral to secure the repayment of any amounts advanced by Ashford LLC under the promissory note, the Company pledged to Ashford LLC the Company’s equity in Ashford Trust OP subject to Ashford LLC’s filing of a financing statement in the appropriate jurisdiction. On November 10, 2025, the promissory note was amended and restated. See below.
Previous report
On August 22, 2025, the Company completed the sale of the 242-room Hilton Houston NASA Clear Lake located in Houston, Texas for $27.8 million, subject to customary pro rations and adjustments, resulting in a recognized gain of $16.5 million.
Previous report
On September 2, 2025, the Company became the sole remaining unit holder and general partner of Stirling OP when Stirling OP redeemed all of its unit holders other than Ashford Trust OP and Ashford TRS for an aggregate of $685,000 in cash. The Company remains the primary beneficiary of Stirling OP and Stirling OP’s properties and debt continueto be reflected on the Company’s balance sheet at their historical carrying values as of September 30, 2025.
Previous report
On September 15, 2025, the Company refinanced the mortgage loan for the Renaissance Hotel in Nashville, Tennessee. The new, non-recourse loan has a balance of $218.1 million and has a two-year term with three one-year extension options, subject to the satisfaction of certain conditions, with a final maturity date of September 2030. The loan is interest only and provides for a floating interest rate of SOFR + 2.26%. In conjunction with the debt refinancing, the preferred equity investment on the property was upsized by $53.0 million, and the all-in rate of return on the preferred equity was reduced from 14% to 11.14%.
Previous report
On October 15, 2025, the Company completed the sale of the 150-room Residence Inn San Diego Sorrento Mesa located in San Diego, California, for $42.0 million, subject to customary pro rations and adjustments.
Previous report
On November 10, 2025, Ashford Trust OP executed an Amended and Restated Master Line of Credit Promissory Note (the “Amended and Restated Promissory Note”) with Ashford Hospitality Advisors LLC (“Ashford LLC”), a subsidiary of Ashford Inc., amending the original Master Line of Credit Promissory note, dated August 14, 2025, allowing Ashford Trust OP to draw up to $40 million in cash through November 15, 2026 to fund Permitted Costs (as defined in the Promissory Note). Funds advanced under the Amended and Restated Promissory Note bear interest at an annual rate of 10.0% which may be paid in cash or paid in-kind at Ashford OP’s discretion. The maturity date of the Amended and Restated Promissory Note is November 15, 2026, at which time all principal drawn upon and outstanding interest are due and payable. As collateral to secure the repayment of any amounts advanced by Ashford LLC under the Amended and Restated Promissory Note, the Company pledged to Ashford LLC the Company’s equity in Ashford Trust OP subject to Ashford LLC’s filing of a financing statement in the appropriate jurisdiction.
Previous report
On November 10, 2025, the Company and Ashford LLC entered into Amendment No. 6 to the Advisory Agreement (the “Sixth Amendment”). The Sixth Amendment further extends the outside date for which any sale or disposition of any of the Company’s Highland Portfolio and JPM8 hotel properties securing the associated mortgage loans following an event of default (as defined in the Advisory Agreement) would be excluded from the numerator of the calculation of the percentage of gross book value of the Company’s assets sold or disposed (but, for the avoidance of doubt, included in the denominator of such calculation) for purposes of determining whether a Company Change of Control (as defined in the Advisory Agreement) has occurred, from August 15, 2026 to November 15, 2026.
Previous report
(2) Referred to as “KEYS A and B properties.”
Previous report
Revenue. Rooms revenue from our hotel properties decreased $11.0 million, or 5.2%, to $201.9 million in the 2025 quarter compared to the 2024 quarter. This decrease in the 2025 quarter is attributable to a decrease of $9.5 million from our Hotel Dispositions and $3.1 million from our comparable hotel properties. These decreases were partially offset by higher rooms revenue of $1.5 million from the Le Méridien that opened in August 2024 (the “Le Méridien Opening”). Our comparable hotel properties experienced an decrease of 2.3% in room rates and a 47 basis point decrease in occupancy.
Previous report
Food and beverage revenue decreased $462,000, or 1.0%, to $45.9 million in the 2025 quarter compared to the 2024 quarter. This decrease in the 2025 quarter is primarily attributable to a decrease of food and beverage sales of $752,000 from our Hotel Dispositions. These decreases were partially offset by increased revenue of $302,000 at the Le Méridien Opening.
Previous report
Impairment Charges. Impairment charges were $18.4 million in the 2025 quarter. The impairment charges related to the New Orleans Le Pavillon Hotel due to a reduction in the property’s estimated future cash flows resulting from a decrease to the expected holding period of the property.
Previous report
Corporate, General and Administrative. Corporate, general and administrative expense increased $2.2 million from $5.1 million in the 2024 quarter to $7.3 million in the 2025 quarter. The increase was primarily attributable to an increase in legal and professional costs of $3.0 million. The increase in the 2025 quarter was partially offset by decreases in miscellaneous expenses of $523,000 and public company costs of $258,000.
Previous report
Other Income (Expense). Other income consisted of miscellaneous income of $0 in the 2025 quarter and $36,000 in the 2024 quarter.
Previous report
Interest Expense and Amortization of Discounts and Loan Costs. Interest expense and amortization of discounts and loan costs decreased $3.9 million, or 5.9%, to $62.9 million during the 2025 quarter compared to the 2024 quarter. The decrease is primarily due to a $3.2 million decrease due to paying off the Oaktree loan in February 2025 and a $2.6 million decrease from our Hotel Dispositions. The decrease additionally includes $1.5 million in amortization of capitalized loan principal which is recorded as a reduction to interest expense. See note 7 to our consolidated financial statements.
Previous report
These decreases were partially offset by higher interest expense and amortization of discounts and loan costs of $2.7 million at our comparable hotel properties and a $677,000 increase in interest expense from the Le Méridien Opening. The average SOFR rates for the 2025 quarter and the 2024 quarter were 4.35% and 5.17%, respectively.
Previous report
Interest Expense Associated with Hotels in Receivership. Interest expense associated with hotels in receivership decreased $1.4 million, from $11.1 million in 2024 quarter to $9.7 million in the 2025 quarter. The decrease is due is primarily due to lower interest rates in the 2025 quarter. See note 7 to our consolidated financial statements.
Previous report
Income Tax (Expense) Benefit. Income tax (expense) benefit changed $704,000, from a benefit of $445,000 in the 2024 quarter to expense of $259,000 in the 2025 quarter. The change was primarily the result of a non-recurring benefit recorded in the 2024 quarter for a reduction in the current state taxes for certain of our filing groups.
Previous report
Comparison of the Nine Months Ended September 30, 2025 and 2024
Previous report
Net Income (Loss) Attributable to the Company. Net income (loss) attributable to the Company changed $174.4 million from net income of $63.9 million for the nine months ended September 30, 2024 (the “2024 period”) to a net loss of $110.5 million for the nine months ended September 30, 2025 (the “2025 period”) as a result of the factors discussed below.
Previous report
Other hotel revenue, which consists mainly of internet access, parking, and spa revenue, increased $2.8 million, or 5.5%, to $53.1 million in the 2025 period compared to the 2024 period. This increase in the 2025 period is primarily attributable to increases in other hotel revenue of $7.2 million from our comparable hotel properties and $442,000 from the Le Méridien Opening. These increases were partially offset by lower other hotel revenue of $4.4 million from our Hotel Dispositions and $488,000 from the KEYS A and B properties. Other revenue decreased $754,000, or 39.6%, to $1.2 million in the 2025 period compared to the 2024 period.
Previous report
Indirect expenses and management fees decreased $17.1 million in the 2025 period compared to the 2024 period, comprising a decrease of $19.8 million from our Hotel Dispositions and $6.3 million from the KEYS A and B properties. These decreases in the 2025 period were partially offset by an increase of $6.1 million from our comparable hotel properties and $3.0 million from the Le Méridien Opening.
Previous report
Property Taxes, Insurance and Other. Property taxes, insurance and other expense decreased $3.8 million or 7.3%, to $48.5 million in the 2025 period compared to the 2024 period. The decrease in the 2025 period was primarily due to a decrease of $3.6 million from our Hotel Dispositions and $1.0 million from the KEYS A and B properties. The decrease in the 2025 period was partially offset by an increase of $1.0 million from the Le Méridien Opening.
Previous report
Depreciation and Amortization. Depreciation and amortization decreased $8.3 million or 7.2%, to $107.2 million in the 2025 period compared to the 2024 period. The decrease in the 2025 period was primarily due to lower depreciation of $4.7 million from our Hotel Dispositions, $4.3 million from our comparable hotels and $1.8 million from the KEYS A and B properties. The decrease in the 2025 period was partially offset by an increase of $2.6 million from the Le Méridien Opening.
Previous report
Impairment Charges. Impairment charges were $19.8 million in the 2025 period. These charges included $18.4 million related to the New Orleans Le Pavillon Hotel and $1.4 million related to the Residence Inn Evansville. The impairment charges were incurred due to a reduction in both properties’ estimated future cash flows resulting from decreases to the expected holding periods of the properties. On August 11, 2025, the Company completed the sale of the Residence Inn Evansville.
Previous report
Gain (Loss) on Consolidation of VIE and Disposition of Assets and Hotel Properties. Gain on consolidation of VIE and disposition of assets and hotel properties decreased $39.1 million, from $94.4 million in the 2024 period to $55.3 million in the 2025 period. The gain in the 2025 period was primarily related to the sales of the Hilton Houston NASA Clear Lake and the Residence Inn Evansville in August 2025 and the sale of the Boston Courtyard Downtown in January 2025. Other increases include the sale of a parcel of land previously owned by our Residence Inn Orlando property in April 2025. The gain in the 2024 period was primarily related to the sale of seven of our hotel properties in the 2024 period.
Previous report
Gain (Loss) on Derecognition of Assets. Gain on derecognition of assets decreased $127.1 million, from $156.7 million in the 2024 period to $29.6 million in the 2025 period. The gain primarily represents the increase of the contract asset on our consolidated balance sheets. We record a contract asset associated with the accrued interest expense from the default of the KEYS A and KEYS B loans as we expect to be released from this obligation upon final resolution with the lender. The gain in the 2025 period relates to accrued interest on the KEYS A and B properties in receivership and the transfer of the SpringHill Suites BWI Airport to a third-party purchaser in June of 2025. In the 2024 period, the gain primarily related to a gain of $133.9 million from the initial derecognition of assets of the KEYS A and B properties in March of 2024 and additional gains of $22.8 million from the associated accrued interest expense in the 2024 period. See note 7 to our consolidated financial statements.
Previous report
Other Income (Expense). In the 2025 period and the 2024 period, we recorded miscellaneous income of $0 and $108,000, respectively.
Previous report
Gain (Loss) on Extinguishment of Debt. Gain (loss) on extinguishment of debt resulted in a gain of $43,000 in the 2025 period and a gain of $2.8 million in the 2024 period. In June 2024, the Company was informed by its lender that the lender intended to exercise remedies for the maturity default on the Ashton Hotel in Fort Worth, Texas, which secured the Company’s $8.9 million mortgage loan. The Company and the lender agreed to a deed-in-lieu of foreclosure, which was completed on July 16, 2024 and resulted in a gain on extinguishment of debt of approximately $2.6 million.
Previous report
Realized and Unrealized Gain (Loss) on Derivatives. Realized and unrealized gain (loss) on derivatives changed by $4.7 million from an $84,000 loss in the 2024 period to a $4.8 million loss in the 2025 period. In the 2025 period, we recognized $6.5 million of net unrealized losses on our derivatives which were primarily attributable to interest rate caps. These unrealized losses were partially offset by net realized gains on interest rate caps of $1.7 million.
Previous report
Income Tax (Expense) Benefit. Income tax expense decreased $2.6 million, from $3.3 million in the 2024 period to $695,000 in the 2025 period. The change was primarily due to a decrease in overall current state taxes in the 2025 period compared to the 2024 period.
Previous report
We are committed to an investment strategy where we will pursue hotel-related investments as suitable situations arise. Funds for future hotel-related investments are expected to be derived, in whole or in part, from cash on hand, future borrowings under a credit facility or other loans or proceeds from additional issuances of common stock, preferred stock (including net proceeds from the sale of any shares of Series L Preferred Stock or Series M Preferred Stock), or other securities, asset sales, and joint ventures. However, we have no formal commitment or understanding to invest in additional assets, and there can be no assurance that we will successfully make additional investments. We may, when conditions are suitable, consider additional capital-raising opportunities.
Previous report
On February 12, 2025, the Company closed on a $580 million refinancing secured by 16 hotels. The financing includes the hotels that were previously part of the Company’s KEYS Pool C Loan, KEYS Pool D Loan, KEYS Pool E Loan, and the BAML Pool 3 Loan, together with the Westin Princeton. The previous loans had a combined outstanding loan balance of approximately $438.7 million. The new financing is non-recourse, has a two-year term with three one-year extension options, subject to the satisfaction of certain conditions, and bears interest at a floating interest rate of SOFR + 4.37%. The Company used approximately $72 million of the excess proceeds to completely pay off the remaining balance on the Oaktree Credit Agreement, including the $30.0 million exit fee.
Previous report
On February 24, 2025, the Company amended its mortgage loan secured by the 141-room Hotel Indigo Atlanta Midtown in Atlanta, Georgia. Terms of the amendment included extending the current maturity date to February 2026 and adding one one-year extension option, subject to satisfaction of certain conditions.
Previous report
On April 14, 2025, the Company successfully extended its Morgan Stanley Pool mortgage loan secured by 17 hotels. The loan had an original final maturity date in November of 2024. The extension provides for an initial maturity in March of 2026 and two one-year extension options, subject to the satisfaction of certain conditions, with a final maturity date in March of 2028. The loan has a current balance of $409.8 million and continues to bear interest at a floating rate of SOFR + 3.39%.
Previous report
On May 8, 2025, the Company received $35.0 million in return for a preferred equity investment in the Renaissance Hotel in Nashville, Tennessee. The holder is entitled to an all-in rate of return on the preferred equity of 14.0% per annum. The investment is mandatorily redeemable on May 10, 2029.
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Reworded paragraphs (55)
Previous wording
•catastrophic events or geopolitical conditions, such as the conflict between Russia and Ukraine, the Israel-Hamas war and changes to tariffs or trade policies;
Current wording
•catastrophic events or geopolitical conditions, such as the conflict between Russia and Ukraine, the Israel-Palestine-Iran conflict, ongoing instability in Venezuela and changes to tariffs or trade policies;
Previous wording
•legislative and regulatory changes, including changes to the Internal Revenue Code of 1986, as amended (the “Code”), and related rules, regulations and interpretations governing the taxation of real estate investment trusts (“REITs”), including impacts from the One Big Beautiful Bill Act;
Current wording
•legislative and regulatory changes, including changes to the Internal Revenue Code of 1986, as amended (the “Code”), and related rules, regulations and interpretations governing the taxation of real estate investment trusts (“REITs”), including impacts from the One Big Beautiful Bill Act (the “OBBBA”);
Previous wording
•limitations imposed on our business and our ability to satisfy complex rules in order for us to qualify as a REIT for U.S. federal income tax purposes; and
Current wording
•limitations imposed on our business and our ability to satisfy complex rules in order for us to qualify as a REIT for U.S. federal income tax purposes;
Previous wording
When considering forward-looking statements, you should keep in mind the matters summarized under “Item 1A. Risk Factors” in Part I of our 2024 Form 10-K filed on March 21, 2025, and this Quarterly Report, and the discussion in this Management’s Discussion and Analysis of Financial Condition and Results of Operations, could cause our actual results and performance to differ significantly from those contained in our forward-looking statements. Accordingly, we cannot guarantee future results or performance. Readers are cautioned not to place undue reliance on any of these forward-looking statements, which reflect our views as of the date of this Quarterly Report. Furthermore, we do not intend to update any of our forward-looking statements after the date of this Quarterly Report to conform these statements to actual results and performance, except as may be required by applicable law.
Current wording
When considering forward-looking statements, you should keep in mind the matters summarized under “Item 1A. Risk Factors” in Part I of our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 filed on March 23, 2026 (the “2025 Form 10-K”), and this Quarterly Report, and the discussion in this Management’s Discussion and Analysis of Financial Condition and Results of Operations, could cause our actual results and performance to differ significantly from those contained in our forward-looking statements. Accordingly, we cannot guarantee future results or performance. Readers are cautioned not to place undue reliance on any of these forward-looking statements, which reflect our views as of the date of this Quarterly Report. Furthermore, we do not intend to update any of our forward-looking statements after the date of this Quarterly Report to conform these statements to actual results and performance, except as may be required by applicable law.
Previous wording
As of September 30, 2025, our portfolio consisted of 69 consolidated operating hotel properties, which represent 16,821 total rooms, and one additional consolidated operating hotel property owned through a 29.3% investment in a consolidated entity, which represents 188 total rooms. Currently, all of our hotel properties are located in the United States.
Current wording
As of March 31, 2026, our portfolio consisted of 62 consolidated operating hotel properties, which represent 15,403 total rooms, and one additional consolidated operating hotel property owned through a 29.3% investment in a consolidated entity, which represents 188 total rooms. Currently, all of our hotel properties are located in the United States.
Previous wording
We do not operate any of our hotel properties directly; instead we employ hotel management companies to operate them for us under management contracts. As of September 30, 2025, Remington Lodging & Hospitality, LLC (“Remington Hospitality”), a subsidiary of Ashford Inc., manages 51 of our 70 operating hotel properties. Third-party management companies manage the remaining hotel properties.
Current wording
We do not operate any of our hotel properties directly; instead we employ hotel management companies to operate them for us under management contracts. As of March 31, 2026, Remington Lodging & Hospitality, LLC (“Remington Hospitality”), a subsidiary of Ashford Inc., manages 45 of our 63 operating hotel properties. Third-party management companies manage the remaining hotel properties.
Previous wording
Ashford Inc. also provides other products and services to us or our hotel properties through certain entities in which Ashford Inc. has an ownership interest. These products and services include, but are not limited to, design and construction services, debt placement and related services, audiovisual services, real estate advisory and brokerage services, insurance policies covering general liability, workers’ compensation and business automobile claims and insurance claims services, hypoallergenic premium rooms, watersport activities, broker-dealer and distribution services, mobile key technology and cash management services.
Current wording
Ashford Inc. also provides other products and services to us or our hotel properties through certain entities in which Ashford Inc. has an ownership interest. These products and services include, but are not limited to, design and construction services, debt placement and related services, audiovisual services, real estate advisory and brokerage services, insurance policies covering general liability, workers’ compensation and business automobile claims and insurance claims services, hypoallergenic premium rooms, watersport activities and cash management services.
Previous wording
Mr. Monty J. Bennett, chairman and chief executive officer of Ashford Inc. and, together with his father, Mr. Archie Bennett, Jr. (the “Bennetts”), as of September 30, 2025, hold a controlling interest in Ashford Inc. The Bennetts owned approximately 809,937 shares of Ashford Inc. common stock, which represented an approximate 51.5% ownership interest in Ashford Inc., and owned 18,758,600 shares of Ashford Inc. Series D Convertible Preferred Stock, which, along with all unpaid accrued and accumulated dividends thereon, was convertible (at a conversion price of $117.50 per share) into an additional approximate 4,491,456 shares of Ashford Inc. common stock, which, if converted as of September 30, 2025, would have increased the Bennetts’ ownership interest in Ashford Inc. to 87.4%. The 18,758,600 shares of Series D Convertible Preferred Stock owned by Mr. Monty J. Bennett and Mr. Archie Bennett, Jr. include 360,000 shares owned by trusts. Additionally, Mr. Monty J. Bennett acquired the right to direct votes, effective March 25, 2025, and as of September 30, 2025, those rights represented approximately 565,000 common shares.
Current wording
Mr. Monty J. Bennett, chairman and chief executive officer of Ashford Inc. and, together with his father, Mr. Archie Bennett, Jr. (the “Bennetts”), as of March 31, 2026, hold a controlling interest in Ashford Inc. The Bennetts owned approximately 809,937 shares of Ashford Inc. common stock, which represented an approximate 52.5% ownership interest in Ashford Inc., and owned 18,758,600 shares of Ashford Inc. Series D Convertible Preferred Stock, which, along with all unpaid accrued and accumulated dividends thereon, was convertible (at a conversion price of $117.50 per share) into an additional approximate 4,656,337 shares of Ashford Inc. common stock, which, if converted as of March 31, 2026, would have increased the Bennetts’ ownership interest in Ashford Inc. to 88.2%. The 18,758,600 shares of Series D Convertible Preferred Stock owned by Mr. Monty J. Bennett and Mr. Archie Bennett, Jr. include 360,000 shares owned by trusts. Additionally, Mr. Monty J. Bennett acquired the right to direct votes, effective March 25, 2025, and as of March 31, 2026, those rights represented approximately 534,000 common shares.
Previous wording
For additional detail regarding the relationships among the Company, Ashford Securities, the Company’s Advisor and its affiliates, and other entities advised by the Advisor, please see the section titled “Certain Relationships and Related Person Transactions” in the Company’s 2024 Annual Proxy Statement and any current or annual report, prospectus supplement, or proxy statement filed by the Company with the SEC at www.sec.gov.
Current wording
For additional detail regarding the relationships among the Company, Ashford LLC and its affiliates, and other entities advised by Ashford LLC, please see the section titled “Certain Relationships and Related Person Transactions” in the Company’s 2026 Annual Proxy Statement and any current or annual report, prospectus supplement, or proxy statement filed by the Company with the SEC at www.sec.gov.
Previous wording
On November 11, 2025, the Company entered into a definitive agreement to sell the 150-room Embassy Suites Houston located in Houston, Texas, and the 150-room Embassy Suites Austin located in Austin, Texas, for a combined purchase price of $27.0 million. The agreement includes a nonrefundable deposit of $1.0 million which was paid on November 11, 2025.
Current wording
On March 26, 2026, the Company entered into a definitive agreement to sell the 150-room Embassy Suites Dallas located in Dallas, Texas for a purchase price of $17.0 million. The agreement included a nonrefundable deposit of $500,000 which was paid on March 26, 2026. The sale was completed on May 6, 2026.
Previous wording
The following table summarizes the changes in key line items from our consolidated statements of operations for the three and nine months ended September 30, 2025 and 2024 (in thousands):
Current wording
The following table summarizes the changes in key line items from our consolidated statements of operations for the three months ended March 31, 2026 and 2025 (in thousands):
Previous wording
All hotel properties held during the three and nine months ended September 30, 2025 and 2024 have been included in our results of operations during the respective periods in which they were held. Based on when a hotel property was acquired or disposed, operating results for certain hotel properties are not comparable for the three and nine months ended September 30, 2025 and 2024. The hotel properties listed below are not comparable hotel properties for the periods indicated and all other hotel properties are considered comparable hotel properties. The following transactions affect the reporting comparability of our consolidated financial statements:
Current wording
All hotel properties held during the three months ended March 31, 2026 and 2025 have been included in our results of operations during the respective periods in which they were held. Based on when a hotel property was acquired or disposed, operating results for certain hotel properties are not comparable for the three months ended March 31, 2026 and 2025. The hotel properties listed below are not comparable hotel properties for the periods indicated and all other hotel properties are considered comparable hotel properties. The following transactions affect the reporting comparability of our consolidated financial statements:
Previous wording
The following table illustrates the key performance indicators of the 69 comparable hotel properties that were included in our results of operations for the full three and nine months ended September 30, 2025 and 2024, respectively:
Current wording
The following table illustrates the key performance indicators of the 63 comparable hotel properties that were included in our results of operations for the full three months ended March 31, 2026 and 2025, respectively:
Previous wording
Net Income (Loss) Attributable to the Company. Net income (loss) attributable to the Company changed $2.2 million, from net loss of $57.9 million for the three months ended September 30, 2024 (the “2024 quarter”) to a net loss of $60.1 million for the three months ended September 30, 2025 (the “2025 quarter”) as a result of the factors discussed below.
Current wording
Net Income (Loss) Attributable to the Company. Net loss attributable to the Company increased $43.8 million from a net loss of $20.0 million for the three months ended March 31, 2025 (the “2025 quarter”) to a net loss of $63.8 million for the three months ended March 31, 2026 (the “2026 quarter”) as a result of the factors discussed below.
Previous wording
Revenue. Rooms revenue from our hotel properties decreased $50.4 million, or 7.3%, to $635.4 million in the 2025 period compared to the 2024 period. This decrease in the 2025 period is primarily attributable to decreases in rooms revenue of $40.0 million from our Hotel Dispositions, $13.7 million from the KEYS A and B properties that went into receivership in the 2024 period and $2.7 million at our comparable hotel properties. These decreases were partially offset by an increase of $6.0 million in rooms revenue from the Le Méridien Opening in the 2025 period. Our comparable hotel properties experienced a decrease of 0.9% in room rates and a increase of 50 basis points in occupancy.
Current wording
Revenue. Rooms revenue from our hotel properties decreased $6.3 million, or 3.0%, to $200.0 million in the 2026 quarter compared to the 2025 quarter. This decrease in the 2026 quarter was primarily attributable to a decrease in rooms revenue of $12.3 million from our Hotel Dispositions. This decrease was partially offset by an increase in rooms revenue of $6.0 million at our comparable hotel properties. Our comparable hotel properties experienced an increase of 2.1% in room rates and an increase of 79 basis points in occupancy.
Previous wording
Food and beverage revenue decreased $3.2 million, or 2.0%, to $155.8 million in the 2025 period compared to the 2024 period. This decrease in the 2025 period is primarily attributable to decreases in food and beverage revenue of $6.6 million from our Hotel Dispositions and $404,000 from the KEYS A and B properties. These decreases were partially offset by higher food and beverage revenue of $2.6 million at our comparable hotel properties and $1.1 million from the Le Méridien Opening.
Current wording
Food and beverage revenue decreased $3.0 million, or 5.4%, to $51.6 million in the 2026 quarter compared to the 2025 quarter. This decrease in the 2026 quarter was primarily attributable to decreases in food and beverage revenue of $2.1 million from our Hotel Dispositions and $867,000 at our comparable hotel properties.
Previous wording
Other hotel revenue, which consists mainly of internet access, parking, and spa revenue, increased $1.2 million, or 7.0%, to $17.8 million in the 2025 quarter compared to the 2024 quarter. This increase is primarily attributable to an increase of $1.6 million and $128,000 at our comparable hotel properties and at the Le Méridien Opening, respectively. The increase was partially offset by a decrease of $517,000 from our Hotel Dispositions. Other non-hotel revenue decreased $197,000, or 33.8%, to $385,000 in the 2025 quarter as compared to the 2024 quarter.
Current wording
Other hotel revenue, which consists mainly of internet access, parking, and spa revenue, decreased $237,000, or 1.5%, to $16.0 million in the 2026 quarter compared to the 2025 quarter. This decrease in the 2026 quarter was primarily attributable to decreases in other hotel revenue of $735,000 from our Hotel Dispositions. This decrease was partially offset by an increase of $498,000 from our comparable hotel properties. Other revenue decreased $155,000, or 50.2%, to $154,000 in the 2026 quarter compared to the 2025 quarter.
Previous wording
Hotel Operating Expenses. Hotel operating expenses decreased $1.6 million, or 0.8%, to $193.3 million in the 2025 quarter compared to the 2024 quarter. Hotel operating expenses consist of direct expenses from departments associated with revenue streams and indirect expenses associated with support departments and management fees. Direct expenses decreased $1.3 million in the 2025 quarter as compared to the 2024 quarter primarily due to a decrease of $2.4 million from our Hotel Dispositions. The decrease in direct expenses was partially offset by increases of $854,000 and $299,000 from the Le Méridien Opening and our comparable hotels, respectively, in the 2025 quarter. Direct expenses were 32.4% of total hotel revenue for the 2025 quarter and 31.6% for the 2024 quarter.
Current wording
Hotel Operating Expenses. Hotel operating expenses decreased $7.3 million, or 3.9%, to $181.1 million in the 2026 quarter compared to the 2025 quarter. Hotel operating expenses consist of direct expenses from departments associated with revenue streams and indirect expenses associated with support departments and management fees. Direct expenses decreased $3.1 million in the 2026 quarter compared to the 2025 quarter, primarily due to a decrease of $3.8 million from our Hotel Dispositions. The decrease in direct expenses was partially offset by an increase in the 2026 quarter of $664,000 from our comparable hotel properties. Direct expenses were 30.9% of total hotel revenue for the 2026 quarter and 30.9% for the 2025 quarter.
Previous wording
Indirect expenses and management fees decreased $283,000 in the 2025 quarter as compared to the 2024 quarter primarily due to a decrease of $4.2 million from our Hotel Dispositions. The decrease in the 2025 quarter was partially offset by an increase of $3.0 million from our comparable hotel properties and $1.0 million from the Le Méridien Opening.
Current wording
Indirect expenses and management fees decreased $4.3 million in the 2026 quarter compared to the 2025 quarter, primarily due to a decrease of $5.5 million from our Hotel Dispositions. The decrease in the 2026 quarter was partially offset by an increase of $1.2 million from our comparable hotel properties.
Previous wording
Property Taxes, Insurance and Other. Property taxes, insurance and other expense decreased $1.9 million, or 10.2%, to $16.2 million during the 2025 quarter compared to the 2024 quarter. The decrease in the 2025 quarter was primarily due to a decrease of $1.7 million and $429,000 from our comparable hotel properties and from our Hotel Dispositions, respectively. The decrease in the 2025 quarter was partially offset by an increase of $265,000 from the Le Méridien Opening.
Current wording
Property Taxes, Insurance and Other. Property taxes, insurance and other expense decreased $1.2 million or 7.2%, to $14.9 million in the 2026 quarter compared to the 2025 quarter. The decrease in the 2026 quarter was primarily due to decreases of $583,000 from our Hotel Dispositions and $572,000 from our comparable hotel properties.
Previous wording
Depreciation and Amortization. Depreciation and amortization decreased $3.2 million, or 8.3%, to $34.6 million during the 2025 quarter compared to the 2024 quarter. The decrease in the 2025 quarter was primarily due to decreases of $1.1 million from our Hotel Dispositions and $2.4 million from our comparable hotel properties. The decrease in the 2025 quarter was partially offset by an increase of $358,000 from the Le Méridien Opening.
Current wording
Depreciation and Amortization. Depreciation and amortization decreased $5.3 million or 14.3%, to $32.0 million in the 2026 quarter compared to the 2025 quarter. The decreases in the 2026 quarter were primarily due to decreases of $3.2 million from our Hotel Dispositions and $2.1 million from our comparable hotel properties.
Previous wording
Advisory Services Fee. Advisory services fee decreased $1.3 million, or 11.0%, to $10.6 million in the 2025 quarter compared to the 2024 quarter. The advisory services fee represents fees incurred in connection with the advisory agreements between Ashford Inc. and the Company and between Ashford Inc. and Stirling OP prior to September 2, 2025. In the 2025 quarter, the advisory services fee was comprised a base advisory fee of $8.3 million, reimbursable expenses of $2.9 million and fees totaling $113,000 associated with the Stirling OP’s advisory agreement incurred prior to September 2, 2025. In the 2024 quarter, the advisory services fee comprised a base advisory fee of $8.1 million, equity-based compensation of $218,000 awarded to the officers and employees of Ashford Inc., reimbursable expenses of $3.3 million and fees totaling $296,000 associated with Stirling OP’s advisory agreement.
Current wording
Advisory Services Fee. The advisory services fee increased $8.5 million, or 73.4%, to $20.0 million in the 2026 quarter compared to the 2025 quarter primarily due to an increase in reimbursable expenses arising from the Company’s obligation to indemnify Ashford LLC for certain tax liabilities under the Advisory Agreement. The advisory services fee represents fees incurred in connection with the advisory agreements between Ashford Inc. and the Company and, prior to September 2, 2025, between Ashford Inc. and Stirling OP. In the 2026 quarter, the advisory services fee comprised a base advisory fee of $8.3 million and reimbursable expenses of $11.7 million. In the 2025 quarter, the advisory services fee comprised a base advisory fee of $8.1 million, reimbursable expenses of $3.2 million, an incentive advisory fee of $93,000, and fees totaling $268,000 associated with Stirling OP’s advisory agreement.
Previous wording
Corporate, General and Administrative. Corporate, general and administrative expenses decreased $3.3 million, or 16.3%, to $17.1 million in the 2025 period compared to the 2024 period. The decrease was primarily attributable to a decrease in reimbursements of Ashford Securities’ operating expenses of $2.7 million, miscellaneous expenses of $1.5 million and public company costs of $290,000. The decrease in the 2025 period was partially offset by an increase of $1.2 million in legal and professional expenses.
Current wording
Corporate, General and Administrative. Corporate, general and administrative expenses decreased $2.7 million, or 63.0%, to $1.6 million in the 2026 quarter compared to the 2025 quarter. The decrease was primarily attributable to decreases in reimbursements of Ashford Securities’ operating expenses of $1.3 million from the winding down of Ashford Securities, legal and professional expenses of $937,000, public company costs of $414,000 and miscellaneous expenses of $97,000.
Previous wording
Gain (Loss) on Consolidation of VIE and Disposition of Assets and Hotel Properties. Gain on consolidation of VIE and disposition of assets and hotel properties increased $16.7 million from $9,000 in the 2024 quarter to $16.8 million in the 2025 quarter. The gain in the 2025 quarter was primarily related to the gain from the sale of the Hilton Houston NASA Clear Lake of $16.0 million.
Current wording
Gain (Loss) on Disposition of Assets and Hotel Properties. Gain on disposition of assets and hotel properties increased $68.2 million, from $31.9 million in the 2025 quarter to $100.0 million in the 2026 quarter. The gain in the 2026 quarter was primarily related to the sale of five of our hotel properties in the 2026 quarter. The gain in the 2025 quarter was primarily related to the sale of Courtyard Boston Downtown.
Previous wording
Gain (Loss) on Derecognition of Assets. Gain on derecognition of assets decreased $1.4 million from $11.1 million in the 2024 quarter to $9.7 million in the 2025 quarter. The gain primarily represents the increase of the contract asset on our consolidated balance sheets. We record a contract asset associated with the accrued interest expense from the default of the KEYS A and KEYS B loans as we expect to be released from this obligation upon final resolution with the lender. The gains in the 2025 quarter and in the 2024 quarter primarily relate to accrued interest on the KEYS A and B properties in receivership. See note 7 to our consolidated financial statements.
Current wording
Gain (Loss) on Derecognition of Assets. Gain on derecognition of assets decreased $2.3 million, from $10.0 million in the 2025 quarter to $7.8 million in the 2026 quarter. The gain primarily represents the increase of the contract asset on our consolidated balance sheets. We record a contract asset associated with the accrued interest expense from the default of the KEYS A and KEYS B loans as we expect to be released from this obligation upon final resolution with the lender. The gains in the 2026 quarter and the 2025 quarter relate to accrued interest on the KEYS A and B properties in receivership.
Previous wording
Equity in Earnings (Loss) of Unconsolidated Entities. Equity in loss of unconsolidated entities was $258,000 in the 2025 period and $828,000 in the 2024 period. Equity in loss primarily results from our investment in an entity that owns the Meritage Resort and Spa and the Grand Reserve at the Meritage in Napa, California.
Current wording
Equity in Earnings (Loss) of Unconsolidated Entities. Equity in loss of unconsolidated entities was $202,000 in the 2026 quarter and $431,000 in the 2025 quarter. Equity in loss primarily results from our investment in an entity that owns the Meritage Resort and Spa and the Grand Reserve at the Meritage in Napa, California.
Previous wording
Interest Income. Interest income was $1.2 million and $1.8 million for the 2025 quarter and the 2024 quarter, respectively. The decrease in interest income in the 2025 quarter was primarily attributable to lower excess cash balances in the 2025 quarter compared to the 2024 quarter.
Current wording
Interest Income. Interest income was $922,000 and $1.2 million in the 2026 quarter and the 2025 quarter, respectively. The decrease in interest income in the 2026 quarter was primarily attributable to lower excess cash balances in the 2026 quarter compared to the 2025 quarter.
Previous wording
Interest Expense and Amortization of Discounts and Loan Costs. Interest expense and amortization of discounts and loan costs decreased $8.8 million, or 4.2%, to $200.4 million in the 2025 period compared to the 2024 period. The decrease was primarily due to lower cash interest expense and amortization of loan costs of $16.7 million as a result of the pay-off of the Oaktree loan in February 2025 and a $12.3 million decrease from our Hotel Dispositions. These decreases were partially offset by higher default interest and late charges recorded on mortgage loans in default of $11.4 million, higher interest expense and amortization of discounts and loan costs at our comparable hotels of $5.7 million and higher interest expense of $3.1 million from the Le Méridien Opening. The average SOFR rates in the 2025 period and the 2024 period were 4.35% and 5.27%, respectively.
Current wording
Interest Expense and Amortization of Discounts and Loan Costs. Interest expense and amortization of discounts and loan costs increased $6.8 million, or 10.1%, to $73.6 million in the 2026 quarter compared to the 2025 quarter. The increase was primarily due to higher default interest and late charges recorded on mortgage loans in default of $10.1 million and higher interest expense and amortization of discounts and loan costs at our comparable hotels of $3.3 million. These increases were partially offset by decreases of $5.8 million from our Hotel Dispositions and $944,000 from the pay-off of the Oaktree loan in February 2025.
Previous wording
Interest Expense Associated with Hotels in Receivership. Interest expense associated with hotels in receivership decreased $5.5 million, from $35.2 million in the 2024 period to $29.6 million in the 2025 period. The decrease is due to four fewer hotels being under receivership in the 2025 period compared to the 2024 period. On July 2, 2024, the Courtyard Plano Legacy Park and the Residence Inn Plano were foreclosed on at a public auction. Additionally, on November 4, 2024 and June 25, 2025, the receiver appointed for the KEYS Pool A and KEYS Pool B mortgage loans transferred the Courtyard Columbus Tipton Lakes and SpringHill Suites BWI Airport, respectively, to a third-party purchaser. As a result, the contract asset and corresponding indebtedness associated with hotels in receivership and the accrued interest associated with hotels in receivership were reduced for the amounts attributable to each hotel. See note 7 to our consolidated financial statements.
Current wording
Interest Expense Associated with Hotels in Receivership. Interest expense associated with hotels in receivership decreased $2.2 million, from $10.0 million in the 2025 quarter to $7.8 million in the 2026 quarter. The decrease is due to fewer hotels being under receivership in the 2026 quarter compared to the 2025 quarter. On June 25, 2025 and December 22, 2025, the Courtyard Oakland Airport and SpringHill Suites BWI Airport mortgage loans were transferred to a third-party purchaser. On March 4, 2026, the SpringHill Suites Plymouth Meeting’s mortgage loan was also transferred to a third-party purchaser. As a result, the contract asset and corresponding indebtedness associated with hotels in receivership and accrued interest associated with hotels in receivership were reduced for the amounts attributable to each hotel. See note 6 to our consolidated financial statements.
Previous wording
Write-off of Premiums, Loan Costs and Exit Fees. Write-off of premiums, loan costs and exit fees was $8.4 million in the 2025 period and $3.8 million in the 2024 period. The balance in the 2025 period primarily relates to fees of $5.6 million from loan refinances and modifications and fees of $2.2 million related to prepayment penalties and exit fees on loan refinances. The balance in the 2024 period primarily relates to fees of $3.0 million related to loan refinances and modifications and $817,000 of unamortized loan cost write-offs.
Current wording
Write-off of Premiums, Loan Costs and Exit Fees. Write-off of premiums, loan costs and exit fees was $1.3 million in the 2026 quarter and $4.6 million in the 2025 quarter. In the 2026 quarter, we incurred fees of $1.3 million from loan refinances and modifications. In the 2025 quarter, we incurred fees of approximately $1.8 million related to loan refinances and modifications, $2.2 million related to prepayment penalties and exit fees on loan refinances, wrote-off $378,000 of unamortized loan costs and incurred $193,000 non-reimbursed legal fees relating to the repaying the Oaktree loan.
Previous wording
Gain (Loss) on Extinguishment of Debt. Gain (loss) on extinguishment of debt resulted in a gain of $58,000 in the 2025 quarter and a gain of $2.7 million in the 2024 quarter. In June 2024, the Company was informed by its lender that the lender intended to exercise remedies for the maturity default on the Ashton Hotel in Fort Worth, Texas, which secured the Company’s $8.9 million mortgage loan. The Company and the lender agreed to a deed-in-lieu of foreclosure, which was completed on July 16, 2024 and resulted in a gain on extinguishment of debt of approximately $2.6 million.
Current wording
Gain (Loss) on Extinguishment of Debt. Gain (loss) on extinguishment of debt resulted in a loss of $25,000 in the 2026 quarter and a loss of $13,000 in the 2025 quarter.
Previous wording
Realized and Unrealized Gain (Loss) on Derivatives. Realized and unrealized gain (loss) on derivatives changed $5.0 million from a $6.2 million gain in the 2024 quarter to an $1.2 million loss in the 2025 quarter. In the 2025 quarter, we recognized net unrealized losses of $1.3 million on our derivatives. These unrealized losses were partially offset by net realized gains of $310,000 related to payments from counterparties on interest rate caps.
Current wording
Realized and Unrealized Gain (Loss) on Derivatives. Realized and unrealized gain (loss) on derivatives changed by $3.5 million from a $2.7 million loss in the 2025 quarter to a $757,000 gain in the 2026 quarter. In the 2026 quarter, we recognized $757,000 of net unrealized gains on our derivatives which were primarily attributable to interest rate caps.
Previous wording
In the 2024 quarter, we recognized unrealized losses of $13.5 million associated with interest rate caps and the revaluation of the embedded debt derivative in the Oaktree Agreement. These unrealized losses were partially offset by a realized gain of $7.3 million related to payments from counterparties on interest rate caps.
Current wording
In the 2025 quarter, we recorded unrealized and realized losses of $2.3 million and $369,000, respectively, associated with interest rate caps and we recorded an unrealized loss of $901,000 from the revaluation of the embedded debt derivative in the Oaktree Agreement. These losses were partially offset by a realized gain of $692,000 related to payments from counterparties on interest rate caps and an unrealized gain of $184,000 associated with interest rate floors.
Previous wording
(Income) Loss from Consolidated Entities Attributable to Noncontrolling Interests. Our noncontrolling interest partners in consolidated entities were allocated a loss of $4.7 million and $494,000 in the 2025 period and the 2024 period, respectively. Noncontrolling interests in consolidated entities represented an ownership interest of 70.7% in 815 Commerce MM and, prior to September 2, 2025, 0.30% in Stirling OP. See notes 1 and 2 to our consolidated financial statements.
Current wording
(Income) Loss from Consolidated Entities Attributable to Noncontrolling Interests. Our noncontrolling interest partners in consolidated entities were allocated losses of $655,000 and $1.8 million in the 2026 quarter and the 2025 quarter, respectively. Noncontrolling interests in consolidated entities represented an ownership interest of 70.7% in 815 Commerce MM and, prior to September 2, 2025, 0.30% in Stirling OP. See notes 1 and 2 to our consolidated financial statements.
Previous wording
Net (Income) Loss Attributable to Redeemable Noncontrolling Interests in Operating Partnership. Noncontrolling interests in operating partnership were allocated a net loss of $1.0 million in the 2025 quarter and a net loss of $746,000 in the 2024 quarter. Redeemable noncontrolling interests represented ownership interests of 1.49% and 1.17% in the operating partnership at September 30, 2025 and 2024, respectively.
Current wording
Net (Income) Loss Attributable to Redeemable Noncontrolling Interests in Operating Partnership. Redeemable noncontrolling interests in operating partnership were allocated a net loss of $1.0 million in the 2026 quarter and a net loss of $451,000 in the 2025 quarter. Redeemable noncontrolling interests represented ownership interests of 1.43% and 1.60% in the operating partnership as of March 31, 2026 and 2025, respectively.
Previous wording
As of September 30, 2025, the Company held cash and cash equivalents of $81.9 million and restricted cash of $166.9 million (including amounts held for sale), the vast majority of which comprises lender and manager-held reserves. As of September 30, 2025, $27.4 million (including amounts held for sale) was also due to the Company from third-party hotel managers, most of which is held by one of the Company’s managers and is available to fund hotel operating costs. At September 30, 2025, our net debt to gross assets was 71.9%.
Current wording
As of March 31, 2026, the Company held cash and cash equivalents of $79.8 million and restricted cash of $141.2 million (including amounts held for sale), the vast majority of which comprises lender and manager-held reserves. As of March 31, 2026, $24.5 million (including amounts held for sale) was also due to the Company from third-party hotel managers, most of which is held by one of the Company’s managers and is available to fund hotel operating costs. During the three months ended March 31, 2026, the net increase in cash, cash equivalents and restricted cash (including cash, cash equivalents and restricted cash held for sale) was$4.6 million.
Previous wording
Based on our current level of operations, our cash flow from operations, capital market activities, asset sales and our existing cash balances should be adequate to meet upcoming anticipated requirements for interest and principal payments on debt (excluding any potential final maturity payments and paydowns for extension tests), working capital and capital expenditures for the next 12 months and dividends required to maintain our status as a REIT for U.S. federal income tax purposes. With respect to upcoming maturities, no assurances can be given that we will be able to refinance our upcoming maturities. Additionally, no assurances can be given that we will obtain additional financings or, if we do, what the amount and terms will be. Our failure to obtain future financing under favorable terms could adversely impact our ability to execute our business strategy or may result in lender foreclosure.
Current wording
With respect to upcoming maturities, no assurances can be given that we will be able to refinance our upcoming maturities. Additionally, no assurances can be given that we will obtain additional financings or, if we do, what the amount and terms will be. Our failure to obtain future financing under favorable terms could adversely impact our ability to execute our business strategy or may result in lender foreclosure.
Previous wording
Certain of our loan agreements contain cash trap provisions that may be triggered if the performance of our hotels declines below a threshold. When these provisions are triggered, substantially all of the profit generated by our hotels is deposited directly into lockbox accounts and then swept into cash management accounts for the benefit of our various lenders. During a cash trap, certain disbursements from these hotel operating cash receipts would require consent of our lenders. At September 30, 2025, 45 of our hotels were in cash traps and approximately $4.4 million of our restricted cash was subject to these cash traps. Our loans currently in cash traps may remain subject to cash trap provisions for a substantial period of time, which could limit our flexibility and adversely affect our financial condition or our qualification as a REIT.
Current wording
Certain of our loan agreements contain cash trap provisions that may be triggered if the performance of our hotels declines below a threshold. When these provisions are triggered, substantially all of the profit generated by our hotels is deposited directly into lockbox accounts and then swept into cash management accounts for the benefit of our various lenders. During a cash trap, certain disbursements from these hotel operating cash receipts would require consent of our lenders. At March 31, 2026, 38 of our hotels were in cash traps and approximately $2.6 million of our restricted cash was subject to these cash traps. Our loans currently in cash traps may remain subject to cash trap provisions for a substantial period of time, which could limit our flexibility and adversely affect our financial condition or our qualification as a REIT.
Previous wording
Mortgage and mezzanine loans are nonrecourse to the borrowers, except for customary exceptions or carve-outs that trigger recourse liability to the borrowers in certain limited instances. Recourse obligations typically include only the payment of costs and liabilities suffered by lenders as a result of the occurrence of certain bad acts on the part of the borrower. However, in certain cases, carve-outs could trigger recourse obligations on the part of the borrower with respect to repayment of all or a portion of the outstanding principal amount of the loans. We have entered into customary guaranty agreements pursuant to which we guaranty payment of any recourse liabilities of the borrowers that result from non-recourse carve-outs (which include, but are not limited to, fraud, misrepresentation, willful conduct resulting in waste, misappropriation of rents following an event of default, voluntary bankruptcy filings, unpermitted transfers of collateral and certain environmental liabilities). In the opinion of management, none of these guaranty agreements, either individually or in the aggregate, are likely to have a material adverse effect on our business, results of operations, or financial condition.
Current wording
Mortgage and mezzanine loans are non-recourse to the borrowers, except for customary exceptions or carve-outs that trigger recourse liability to the borrowers in certain limited instances. Recourse obligations typically include only the payment of costs and liabilities suffered by lenders as a result of the occurrence of certain bad acts on the part of the borrower. However, in certain cases, carve-outs could trigger recourse obligations on the part of the borrower with respect to repayment of all or a portion of the outstanding principal amount of the loans. We have entered into customary guaranty agreements pursuant to which we guaranty payment of any recourse liabilities of the borrowers that result from non-recourse carve-outs (which include, but are not limited to, fraud, misrepresentation, willful conduct resulting in waste, misappropriation of rents following an event of default, voluntary bankruptcy filings, unpermitted transfers of collateral and certain environmental liabilities). In the opinion of management, none of these guaranty agreements, either individually or in the aggregate, are likely to have a material adverse effect on our business, results of operations, or financial condition.
Previous wording
The Company continues to work with the lender of the KEYS A and KEYS B loan pools on a consensual transfer of ownership of those hotels to the lender. The original lenders previously transferred the loans to a securitization trust. On March 1, 2024, the Company received notice that the hotel properties that secured the KEYS Pool A and KEYS Pool B loans have been transferred to a court-appointed receiver. Below is a summary of the hotel properties that secured the KEYS Pool A and Pool B loans:
Current wording
On March 1, 2024, the Company received notice that the hotel properties that secured the KEYS Pool A and KEYS Pool B loans have been transferred to a court-appointed receiver. Below is a summary of the hotel properties that secured the KEYS Pool A and Pool B loans:
Showing the first 40 of 55 pairs. Open the source sections for the rest.
Rearranged current paragraphs (4)
Current report — wording carried from elsewhere
On February 9, 2026 and February 17, 2026, the Company completed the sales of the 150-room Embassy Suites Houston located in Houston, Texas, and the 150-room Embassy Suites Austin located in Austin, Texas, for a combined $27.0 million, subject to customary pro rations and adjustments.
Current report — wording carried from elsewhere
KEYS Pool A and KEYS Pool B
Current report — wording carried from elsewhere
On July 2, 2024, the Courtyard Plano Legacy Park and the Residence Inn Plano were foreclosed on at a public auction. Additionally, on November 4, 2024, the receiver appointed for the KEYS Pool A and KEYS Pool B mortgage loans transferred the Courtyard Columbus Tipton Lakes to a third-party purchaser. On June 25, 2025 and December 22, 2025, the receiver appointed for the KEYS Pool A and KEYS Pool B mortgage loans transferred the Courtyard Oakland Airport and SpringHill Suites BWI Airport to a third-party purchaser. On March 4, 2026, the receiver appointed for the KEYS Pool A and KEYS Pool B mortgage loans transferred the SpringHill Suites Plymouth Meeting to a third-party purchaser.
Current report — wording carried from elsewhere
Net Cash Flows Provided by (Used in) Financing Activities. For the three months ended March 31, 2026, net cash flows used in financing activities were $222.0 million. Cash outflows primarily consisted of $218.4 million for repayments of indebtedness and $3.5 million for payments of loan costs and exit fees.
Rearranged previous paragraphs (9)
Previous report — wording carried elsewhere
Equity in Earnings (Loss) of Unconsolidated Entities. Equity in earnings (loss) of unconsolidated entities changed $262,000 from a loss of $133,000 during the 2024 quarter to earnings of $129,000 during the 2025 quarter. Equity in earnings (loss) primarily results from our investment in an entity that owns the Meritage Resort and Spa and the Grand Reserve at the Meritage in Napa, California.
Previous report — wording carried elsewhere
Write-off of Premiums, Loan Costs and Exit Fees. Write-off of premiums, loan costs and exit fees was $2.3 million in the 2025 quarter and $17,000 in the 2024 quarter. In the 2025 quarter, we incurred fees of $2.3 million related to loan refinances and modifications.
Previous report — wording carried elsewhere
(Income) Loss from Consolidated Entities Attributable to Noncontrolling Interests. Our noncontrolling interest partners in consolidated entities were allocated a loss of $1.5 million in the 2025 quarter and a loss of $477,000 in the 2024 quarter. Noncontrolling interests in consolidated entities represented an ownership interest of 70.7% in 815 Commerce MM and, prior to September 2, 2025, an ownership interest of 0.30% in Stirling OP. See notes 1 and 2 to our consolidated financial statements.
Previous report — wording carried elsewhere
Hotel Operating Expenses. Hotel operating expenses decreased $32.6 million, or 5.3%, to $580.6 million in the 2025 period compared to the 2024 period. Hotel operating expenses consist of direct expenses from departments associated with revenue streams and indirect expenses associated with support departments and management fees. Direct expenses decreased $15.5 million in the 2025 period compared to the 2024 period, comprising a decrease of $15.8 million from our Hotel Dispositions and $3.9 million from the KEYS A and B properties. The decrease in direct expenses was partially offset by an increase in the 2025 period of $1.5 million and $2.8 million from our comparable hotel properties and the Le Méridien Opening, respectively. Direct expenses were 30.9% of total hotel revenue for the 2025 period and 30.9% for the 2024 period.
Previous report — wording carried elsewhere
Advisory Services Fee. The advisory services fee decreased $4.4 million, or 11.5%, to $34.1 million in the 2025 period compared to the 2024 period. The advisory services fee represents fees incurred in connection with the advisory agreements between Ashford Inc. and the Company and, prior to September 2, 2025, between Ashford Inc. and Stirling OP. In the 2025 period, the advisory services fee primarily comprised a base advisory fee of $24.6 million, reimbursable expenses of $9.4 million and fees totaling $687,000 associated with Stirling OP’s advisory agreement. In the 2024 period, the advisory services fee comprised a base advisory fee of $24.0 million, equity-based compensation of $1.3 million awarded to the officers and employees of Ashford Inc., reimbursable expenses of $12.4 million and fees totaling $838,000 associated with Stirling OP’s advisory agreement.
Previous report — wording carried elsewhere
Interest Income. Interest income was $3.7 million and $5.4 million in the 2025 period and the 2024 period, respectively. The decrease in interest income in the 2025 period was primarily attributable to lower excess cash balances in the 2025 period compared to the 2024 period.
Previous report — wording carried elsewhere
In the 2024 period, we recognized an unrealized loss of $24.7 million associated with interest rate caps, partially offset by a realized gain of $23.3 million related to payments from counterparties on interest rate caps and an unrealized gain of $1.3 million from the revaluation of the embedded debt derivative in the Oaktree Agreement.
Previous report — wording carried elsewhere
Net (Income) Loss Attributable to Redeemable Noncontrolling Interests in Operating Partnership. Noncontrolling interests in operating partnership were allocated a net loss of $2.1 million in the 2025 period and net income of $672,000 in the 2024 period. Redeemable noncontrolling interests represented ownership interests of 1.49% and 1.17% in the operating partnership as of September 30, 2025 and 2024, respectively.
Previous report — wording carried elsewhere
For the nine months ended September 30, 2024, net cash flows used in financing activities were $251.8 million. Cash outflows primarily consisted of $336.5 million for repayments of indebtedness, $16.7 million for payments of loan costs and exit fees, $14.7 million of payments for preferred dividends, $15.1 million of payments for derivatives and $2.5 million of distributions to noncontrolling interests. Cash outflows were partially offset by cash inflows primarily of $28.2 million of borrowing on indebtedness, $68.3 million of net proceeds from preferred stock offerings, $23.9 million from counterparties from in-the-money interest rate caps, $8.8 million of net proceeds from common stock offerings and $4.9 million of contributions from noncontrolling interests.