Ashford Prime Reports Fourth Quarter And Year End 2015 Results

Feb 25, 2016, 16:52 ET from Ashford Hospitality Prime, Inc.

DALLAS, Feb. 25, 2016 /PRNewswire/ -- Ashford Hospitality Prime, Inc. (NYSE: AHP) ("Ashford Prime" or the "Company") today reported the following results and performance measures for the fourth quarter ended December 31, 2015. The performance measurements for Occupancy, Average Daily Rate (ADR), Revenue Per Available Room (RevPAR), and Hotel EBITDA are comparable assuming each of the hotel properties in the Company's hotel portfolio as of December 31, 2015 were owned as of the beginning of each of the periods presented. Unless otherwise stated, all reported results compare the fourth quarter ended December 31, 2015, with the fourth quarter ended December 31, 2014 (see discussion below). The reconciliation of non-GAAP financial measures is included in the financial tables accompanying this press release.

OVERVIEW

  • Focused strategy of investing in luxury hotels in resort and gateway markets
  • Targets conservative leverage levels of Net Debt/EBITDA of 5.0x or less
  • Highly-aligned management team and advisory structure
  • Dividend yield of approximately 4%

FINANCIAL AND OPERATING HIGHLIGHTS

  • RevPAR for all hotels increased 4.4% to $182.46 during the fourth quarter, driven by a 4.0% increase in ADR and a 0.4% increase in occupancy
  • Adjusted EBITDA was $19.1 million, which reflected 9% growth over the prior year
  • Adjusted funds from operations (AFFO) was $0.22 per diluted share for the quarter as compared with $0.21 from the prior-year quarter
  • On December 21, 2015, the Company announced it had completed the acquisition of the award-winning 180-room Ritz-Carlton St. Thomas for $64 million
  • Capex invested in the quarter was $5.0 million, bringing the full-year total to $19.3 million.

CAPITAL STRUCTURE At December 31, 2015, the Company had total assets of $1.4 billion in continuing operations. As of December 31, 2015, the Company had $840 million of mortgage debt in continuing operations of which $49 million related to its joint venture partner's share of debt on the Capital Hilton and Hilton La Jolla Torrey Pines. Ashford Prime's total combined debt had a blended average interest rate of 4.7%.

On December 21, 2015, the Company announced it had completed the acquisition of the award-winning 180-room Ritz-Carlton St. Thomas for $64 million. The property will continue to be operated as a Ritz-Carlton under a long-term management agreement with Ritz-Carlton. Concurrent with the completion of the acquisition, the Company financed the hotel with a $42 million non-recourse mortgage loan. This loan is interest only and provides for a floating interest rate of LIBOR + 4.95% with a two-year term with three, one-year extension options subject to the satisfaction of certain conditions.

PORTFOLIO REVPAR As of December 31, 2015, the Ashford Prime portfolio consisted of direct hotel investments with twelve properties classified in continuing operations.

  • Comparable RevPAR increased 4.4% to $182.46 for all hotels on a 4.0% increase in ADR and a 0.4% increase in occupancy

HOTEL EBITDA MARGINS AND QUARTERLY SEASONALITY TRENDS The Company believes year-over-year Comparable Hotel EBITDA and Comparable Hotel EBITDA Margin comparisons are more meaningful to gauge the performance of the Company's hotels than sequential quarter-over-quarter comparisons. Given the substantial seasonality in the Company's portfolio, to help investors better understand this seasonality, the Company provides quarterly detail on its Comparable Hotel EBITDA and Comparable Hotel EBITDA Margin for the current and certain prior-year periods based upon the number of hotels in the Company's portfolio as of the end of the current period. As the Company's portfolio mix changes from time to time so will the seasonality for Comparable Hotel EBITDA and Comparable Hotel EBITDA Margin. The details of the quarterly calculations for the previous four quarters for the twelve hotels included in continuing operations are provided in the table attached to this release.

COMMON STOCK DIVIDEND On December 10, 2015, the Company announced that its Board of Directors had declared a quarterly cash dividend of $0.10 per diluted share for the Company's common stock for the fourth quarter ending December 31, 2015, payable on January 15, 2016, to shareholders of record as of December 31, 2015. This reflects the Company's revised cash dividend policy announced on May 13, 2015, when Ashford Prime's Board of Directors increased its quarterly cash dividend from $0.05 to $0.10 per diluted share for the Company's common stock, representing a 100% increase. The Board also approved the dividend policy for 2016, during which the Company expects to pay a quarterly cash dividend of $0.10 per share, or $0.40 per share on an annualized basis, subject to quarterly review.

"We are pleased with our fourth quarter RevPAR performance, which reflected strong contribution from our recently acquired Bardessono property in Napa Valley during our first full quarter of ownership," commented Monty J. Bennett, Ashford Prime's Chairman and Chief Executive Officer. "We were also very excited to have completed the acquisition of the Ritz-Carlton St. Thomas which further strengthens the Prime portfolio. We expect this trophy asset to be a significant contributor given that it recently underwent a comprehensive $22 million renovation that is driving strong RevPAR growth and meaningful upside potential."

Mr. Bennett concluded, "As we continue to execute on our strategy of focusing on high quality luxury assets in resort and gateway markets, the Independent Directors of our board are concurrently actively engaged in a strategic review of the Company in order to maximize value for our shareholders. This comprehensive review comprises exploring a full range of strategic alternatives, including a possible sale of the Company."

The Independent Directors are in the process of the strategic review, and there can be no assurance that the Company will enter into any transaction at this time or in the future. The Company does not intend to make any further public comment regarding the review until it has been completed.

INVESTOR CONFERENCE CALL AND SIMULCAST Ashford Hospitality Prime, Inc. will conduct a conference call on Friday, February 26, 2016, at 11:00 a.m. ET. The number to call for this interactive teleconference is (719) 325-2308. A replay of the conference call will be available through Friday, March 4, 2016, by dialing (719) 457-0820 and entering the confirmation number, 4881188.

The Company will also provide an online simulcast and rebroadcast of its fourth quarter 2015 earnings release conference call. The live broadcast of Ashford Hospitality Prime's quarterly conference call will be available online at the Company's web site, www.ahpreit.com on Friday, February 26, 2016, beginning at 11:00 a.m. ET. The online replay will follow shortly after the call and continue for approximately one year.

Substantially all of our non-current assets consist of real estate investments secured by real estate. Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values instead have historically risen or fallen with market conditions, most industry investors consider supplemental measures of performance, which are not measures of operating performance under GAAP, to assist in evaluating a real estate company's operations. These supplemental measures include FFO, AFFO, EBITDA, and Hotel EBITDA. FFO is computed in accordance with our interpretation of standards established by NAREIT, which may not be comparable to FFO reported by other REITs that do not define the term in accordance with the current NAREIT definition or that interpret the NAREIT definition differently than us. Neither FFO, AFFO, EBITDA, nor Hotel EBITDA represents cash generated from operating activities as determined by GAAP and should not be considered as an alternative to a) GAAP net income (loss) as an indication of our financial performance or b) GAAP cash flows from operating activities as a measure of our liquidity, nor are such measures indicative of funds available to satisfy our cash needs, including our ability to make cash distributions. However, management believes FFO, AFFO, EBITDA, and Hotel EBITDA to be meaningful measures of a REIT's performance and should be considered along with, but not as an alternative to, net income and cash flow as a measure of our operating performance.

Ashford Hospitality Prime is a real estate investment trust (REIT) focused on investing in luxury hotels located in resort and gateway markets.

Follow Chairman and CEO Monty Bennett on Twitter at www.twitter.com/MBennettAshford or @MBennettAshford.

Ashford has created an Ashford App for the hospitality REIT investor community. The Ashford App is available for free download at Apple's App Store and the Google Play Store by searching "Ashford."

Certain statements and assumptions in this press release contain or are based upon "forward-looking" information and are being made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements in this press release include, among others, statements about the implied share price for the Company's common stock. These forward-looking statements are subject to risks and uncertainties. When we use the words "will likely result," "may," "anticipate," "estimate," "should," "expect," "believe," "intend," or similar expressions, we intend to identify forward-looking statements. Such statements are subject to numerous assumptions and uncertainties, many of which are outside Ashford Prime's control.

These forward-looking statements are subject to known and unknown risks and uncertainties, which could cause actual results to differ materially from those anticipated, including, without limitation: general volatility of the capital markets and the market price of our common stock; changes in our business or investment strategy; availability, terms and deployment of capital; availability of qualified personnel; changes in our industry and the market in which we operate, interest rates or the general economy; our ability to successfully complete and integrate acquisitions, and manage our planned growth, and the degree and nature of our competition. These and other risk factors are more fully discussed in Ashford Prime's filings with the Securities and Exchange Commission. EBITDA is defined as net income before interest, taxes, depreciation and amortization. EBITDA yield is defined as trailing twelve month EBITDA divided by the purchase price. A capitalization rate is determined by dividing the property's annual net operating income by the purchase price. Net operating income is the property's funds from operations minus a capital expense reserve of either 4% or 5% of gross revenues. Hotel EBITDA flow-through is the change in Hotel EBITDA divided by the change in total revenues. Hotel EBITDA Margin is Hotel EBITDA divided by total revenues. Funds from operations ("FFO"), as defined by the White Paper on FFO approved by the Board of Governors of the National Association of Real Estate Investment Trusts ("NAREIT") in April 2002, represents net income (loss) computed in accordance with generally accepted accounting principles ("GAAP"), excluding gains (or losses) from sales of properties and extraordinary items as defined by GAAP, plus depreciation and amortization of real estate assets, and net of adjustments for the portion of these items related to unconsolidated entities and joint ventures.

The forward-looking statements included in this press release are only made as of the date of this press release. Investors should not place undue reliance on these forward-looking statements. We are not obligated to publicly update or revise any forward-looking statements, whether as a result of new information, future events or circumstances, changes in expectations or otherwise.

ASHFORD HOSPITALITY PRIME, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(in thousands, except share amounts)

(unaudited)

December 31,

December 31,

2015

2014

ASSETS

Cash and cash equivalents

$ 105,039

$ 171,439

Investments in hotel properties, net

1,091,479

990,303

Restricted cash

33,135

29,646

Accounts receivable, net of allowance of $68 and $47, respectively

13,370

12,382

Inventories

1,451

696

Note receivable

8,098

8,098

Deferred costs, net

755

1,204

Prepaid expenses

3,132

2,422

Investment in AIM REHE Fund

48,365

-

Investment in Ashford Inc., at fair value

10,377

-

Derivative assets

753

35

Other assets

2,543

1,193

Intangible asset, net

23,160

2,542

Due from related party, net

371

541

Due from third-party hotel managers

10,722

5,504

Total assets

$ 1,352,750

$ 1,226,005

LIABILITIES AND EQUITY

Liabilities:

Indebtedness, net

$ 835,592

$ 761,727

Accounts payable and accrued expenses

43,568

29,273

Dividends payable

3,439

1,425

Unfavorable management contract liabilities

158

316

Due to Ashford Trust OP, net

528

896

Due to Ashford Inc.

6,369

2,546

Due to third-party hotel managers

1,158

954

Intangible liability, net

3,682

3,739

Other liabilities

1,181

1,131

Total liabilities

895,675

802,007

5.50% Series B cumulative convertible preferred stock, $0.01 par value, 2,600,000 shares issued and

outstanding at December 31, 2015

62,248

-

Redeemable noncontrolling interests in operating partnership

61,781

149,555

Equity:

Common stock, $0.01 par value, 200,000,000 shares authorized, 28,471,775 and 24,464,163 shares issued and

outstanding at December 31, 2015 and December 31, 2014, respectively

285

245

Additional paid-in capital

438,347

376,869

Accumulated deficit

(99,773)

(98,210)

Total stockholders' equity of the Company

338,859

278,904

Noncontrolling interest in consolidated entities

(5,813)

(4,461)

Total equity

333,046

274,443

Total liabilities and equity

$ 1,352,750

$ 1,226,005

ASHFORD HOSPITALITY PRIME, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share amounts)

(unaudited)

Three Months Ended

Year Ended

December 31,

December 31,

2015

2014

2015

2014

REVENUE

Rooms

$ 62,575

$ 55,011

$ 255,443

$ 226,495

Food and beverage

21,526

18,366

79,894

67,854

Other

4,023

3,350

14,061

12,844

Total hotel revenue

88,124

76,727

349,398

307,193

Other

36

24

147

115

Total revenue

88,160

76,751

349,545

307,308

EXPENSES

Hotel operating expenses

Rooms

14,446

13,072

56,341

51,636

Food and beverage

14,609

11,920

53,535

44,297

Other expenses

24,337

20,515

93,742

80,593

Management fees

3,485

3,117

14,049

12,525

Total hotel operating expenses

56,877

48,624

217,667

189,051

Property taxes, insurance and other

4,736

4,047

18,517

16,174

Depreciation and amortization

11,440

10,550

43,824

40,686

Advisory services fee:

Base advisory fee

2,135

2,281

8,648

8,739

Incentive fee

3,822

-

3,822

-

Reimbursable expenses

411

433

1,827

1,690

Non-cash stock/unit-based compensation

1,745

564

3,592

2,105

Transaction costs

283

-

538

1,871

Corporate, general and administrative:

Non-cash stock/unit-based compensation

-

-

254

246

Other general and administrative

1,324

789

4,880

2,996

Total operating expenses

82,773

67,288

303,569

263,558

OPERATING INCOME

5,387

9,463

45,976

43,750

Equity in earnings (loss) of unconsolidated entity

1,292

-

(2,927)

-

Interest income

13

7

34

27

Other income

-

-

1,233

-

Interest expense

(9,029)

(9,372)

(35,254)

(37,203)

Amortization of loan costs

(740)

(500)

(2,575)

(1,828)

Write-off of loan costs and exit fees

-

-

(54)

-

Unrealized loss on investments

(1,988)

-

(7,609)

-

Unrealized loss on derivatives

(1,151)

(48)

(3,252)

(111)

INCOME (LOSS) BEFORE INCOME TAXES

(6,216)

(450)

(4,428)

4,635

Income tax (expense) benefit

108

(475)

(263)

(1,097)

NET INCOME (LOSS)

(6,108)

(925)

(4,691)

3,538

Income from consolidated entities attributable to noncontrolling interest

(1,346)

(1,844)

(2,414)

(1,103)

Net (income) loss attributable to redeemable noncontrolling interests in operating partnership

1,064

717

393

(496)

NET INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY

(6,390)

(2,052)

(6,712)

1,939

Preferred dividends

(893)

-

(1,986)

-

NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCKHOLDERS

$ (7,283)

$ (2,052)

$ (8,698)

$ 1,939

INCOME (LOSS) PER SHARE – BASIC AND DILUTED

Basic:

Net income (loss) attributable to common stockholders

$ (0.26)

$ (0.08)

$ (0.34)

$ 0.08

Weighted average common shares outstanding – basic

28,331

24,954

25,888

24,473

Diluted:

Net income (loss) attributable to common stockholders

$ (0.26)

$ (0.08)

$ (0.34)

$ 0.07

Weighted average common shares outstanding – diluted

28,331

24,954

25,888

33,325

Dividends declared per common share:

$ 0.10

$ 0.05

$ 0.35

$ 0.20

Amounts attributable to common stockholders:

Net income (loss) attributable to the Company

$ (6,390)

$ (2,052)

$ (6,712)

$ 1,939

Preferred dividends

(893)

-

(1,986)

-

Net income (loss) attributable to common stockholders

$ (7,283)

$ (2,052)

$ (8,698)

$ 1,939

ASHFORD HOSPITALITY PRIME, INC. AND SUBSIDIARIES

RECONCILIATION OF NET INCOME (LOSS) TO EBITDA AND ADJUSTED EBITDA

(in thousands)

(unaudited)

Three Months Ended

Year Ended

December 31,

December 31,

2015

2014

2015

2014

Net income (loss)

$ (6,108)

$ (925)

$ (4,691)

$ 3,538

Income from consolidated entities attributable to noncontrolling interest

(1,346)

(1,844)

(2,414)

(1,103)

Net (income) loss attributable to redeemable noncontrolling interests in operating partnership

1,064

717

393

(496)

Net income (loss) attributable to the Company

(6,390)

(2,052)

(6,712)

1,939

Interest income

(13)

(7)

(34)

(26)

Interest expense and amortization of loan costs

9,385

9,452

36,309

37,188

Depreciation and amortization

10,729

9,778

40,950

37,493

Income tax expense

(108)

475

263

1,097

Net income (loss) attributable to redeemable noncontrolling interests in operating partnership

(1,064)

(717)

(393)

496

EBITDA available to the Company and OP unitholders

12,539

16,929

70,383

78,187

Amortization of unfavorable management contract liabilities

(39)

(39)

(158)

(158)

Write-off of loan costs and exit fees

-

-

54

-

Transaction costs

378

-

633

1,871

Gain on insurance settlements

(21)

(23)

(21)

(23)

Unrealized loss on investments

1,988

-

7,609

-

Unrealized loss on derivatives

1,151

48

3,248

111

Other income (1)

-

-

(1,233)

-

Compensation adjustment related to modified employment terms

-

-

-

573

Non-cash, non-employee stock/unit-based compensation

1,745

560

3,846

1,778

Strategic alternatives and other costs

61

-

973

-

Advisory services incentive fee (2)

2,548

-

2,548

-

Company's portion of unrealized (gain) loss of AIM REHE Fund

(1,292)

-

2,927

-

Adjusted EBITDA available to the Company and OP unitholders

$ 19,058

$ 17,475

$ 90,809

$ 82,339

NOTES:

(1)

Other income, primarily consisting of net realized gain on marketable securities is excluded from Adjusted EBITDA.

(2)

The incentive fee is payable to Ashford Inc. in three annual installments. The deferred portion related to the second and third payments is excluded from Adjusted EBITDA on this schedule and will be included in future periods.

ASHFORD HOSPITALITY PRIME, INC. AND SUBSIDIARIES

RECONCILIATION OF NET INCOME (LOSS) TO FUNDS FROM OPERATIONS ("FFO") AND ADJUSTED FFO

(in thousands, except per share amounts)

(unaudited)

Three Months Ended

Year Ended

December 31,

December 31,

2015

2014

2015

2014

Net income (loss)

$ (6,108)

$ (925)

$ (4,691)

$ 3,538

Income from consolidated entities attributable to noncontrolling interest

(1,346)

(1,844)

(2,414)

(1,103)

Net (income) loss attributable to redeemable noncontrolling interests in operating partnership

1,064

717

393

(496)

Preferred dividends

(893)

-

(1,986)

-

Net income (loss) attributable to common stockholders

(7,283)

(2,052)

(8,698)

1,939

Depreciation and amortization on real estate

10,729

9,778

40,950

37,493

Net income (loss) attributable to redeemable noncontrolling interests in operating partnership

(1,064)

(717)

(393)

496

FFO available to common stockholders and OP unitholders

2,382

7,009

31,859

39,928

Preferred dividends

893

-

1,986

-

Unrealized loss on investments

1,988

-

7,609

-

Unrealized loss on derivatives

1,151

48

3,248

111

Other income (1)

-

-

(1,233)

-

Transaction costs

378

-

633

1,871

Gain on insurance settlements

(21)

(23)

(21)

(23)

Strategic alternatives and other costs

61

-

973

-

Compensation adjustment related to modified employment terms

-

-

-

573

Write-off of loan costs and exit fees

-

-

54

-

Advisory services incentive fee (2)

2,548

-

2,548

-

Company's portion of unrealized (gain) loss of AIM REHE Fund

(1,292)

-

2,927

-

Adjusted FFO available to the Company and OP unitholders

$ 8,088

$ 7,034

$ 50,583

$ 42,460

Adjusted FFO per diluted share available to common stockholders and OP unitholders

$ 0.22

$ 0.21

$ 1.46

$ 1.27

Weighted average diluted shares

36,091

34,068

34,542

33,421

NOTES:

(1)

Other income, primarily consisting of net realized gain/loss on marketable securities is excluded from Adjusted FFO.

(2)

The incentive fee is payable to Ashford Inc. in three annual installments. The deferred portion related to the second and third payments is excluded from Adjusted FFO on this schedule and will be included in future periods.

ASHFORD HOSPITALITY PRIME, INC. AND SUBSIDIARIES

SUMMARY OF INDEBTEDNESS

DECEMBER 31, 2015

(dollars in thousands)

(unaudited)

Comparable

Comparable

Fixed-Rate

Floating-Rate

Total

TTM Hotel

TTM EBITDA

Indebtedness

Maturity

Interest Rate

Debt

Debt

Debt

EBITDA (5)

Debt Yield

GACC Sofitel - 1 hotel

March 2016

LIBOR + 2.30%

$ -

$ 80,000

(3)

$ 80,000

$ 8,360

10.5%

Senior credit facility - Various

November 2016

LIBOR + 2.25% to 3.75%

-

-

(1)

-

N/A

N/A

Credit Agricole Pier House - 1 hotel

March 2017

LIBOR + 2.25% to 2.50%

-

70,000

(2)

70,000

9,728

13.9%

Wachovia Philly CY - 1 hotel

April 2017

5.91%

33,381

-

33,381

12,518

37.5%

Wachovia 3 - 2 hotels

April 2017

5.95%

122,374

-

122,374

20,249

16.5%

Wachovia 7 - 3 hotels

April 2017

5.95%

249,020

-

249,020

31,582

12.7%

Column Financial - 1 hotel

December 2017

LIBOR + 4.95%

-

40,000

(3)

40,000

3,845

9.6%

Apollo - 1 hotel

December 2017

LIBOR + 4.95%

-

42,000

(3)

42,000

9,156

21.8%

TIF Philly CY - 1 hotel

June 2018

12.85%

8,098

-

8,098

N/A

N/A

Aareal - 2 hotels

November 2019

LIBOR + 2.65%

-

195,359

(4)

195,359

27,818

14.2%

Total

$ 412,873

$ 427,359

$ 840,232

$ 123,256

14.7%

Percentage

49.1%

50.9%

100.0%

Weighted average interest rate

6.08%

3.39%

4.71%

All indebtedness is non-recourse with the exception of the senior credit facility.

(1) This credit facility has two one-year extension options subject to advance notice, certain conditions and a 0.25% extension fee beginning November 2016.

(2) On March 7, 2015, we refinanced our $69.0 million mortgage loan due September 2015 with a $70.0 million loan due March 2017 with three one-year extension options. The new loan provides for a floating interest rate of LIBOR + 2.25%.

(3) This mortgage loan has three one-year extension options subject to satisfaction of certain conditions.

(4) This mortgage loan has two one-year extension options subject to satisfaction of certain conditions.

(5) See Exhibit 1 for reconciliation of net income (loss) to hotel EBITDA.

ASHFORD HOSPITALITY PRIME, INC. AND SUBSIDIARIES

INDEBTEDNESS BY MATURITY ASSUMING EXTENSION OPTIONS ARE EXERCISED

DECEMBER 31, 2015

(in thousands)

(unaudited)

2016

2017

2018

2019

2020

Thereafter

Total

Senior credit facility - Various

$ -

$ -

$ -

$ -

$ -

$ -

$ -

Wachovia Philly CY - 1 hotel

-

32,532

-

-

-

-

32,532

Wachovia 3 - 2 hotels

-

119,245

-

-

-

-

119,245

Wachovia 7 - 3 hotels

-

242,202

-

-

-

-

242,202

TIF Philly CY - 1 hotel

-

-

8,098

-

-

-

8,098

GACC Sofitel - 1 hotel

-

-

-

80,000

-

-

80,000

Credit Agricole Pier House - 1 hotel

-

-

-

-

70,000

-

70,000

Column Financial - 1 hotel

-

-

-

-

40,000

-

40,000

Apollo - 1 hotel

-

-

-

-

42,000

-

42,000

Aareal - 2 hotels

-

-

-

-

-

177,486

177,486

Principal due in future periods

$ -

$ 393,979

$ 8,098

$ 80,000

$ 152,000

$ 177,486

$ 811,563

Scheduled amortization payments remaining

8,856

7,526

2,939

3,120

3,312

2,916

28,669

Total indebtedness

$ 8,856

$ 401,505

$ 11,037

$ 83,120

$ 155,312

$ 180,402

$ 840,232

ASHFORD HOSPITALITY PRIME, INC. AND SUBSIDIARIES

KEY PERFORMANCE INDICATORS

(unaudited)

Three Months Ended

December 31,

Actual

Pre-acquisition

Comparable

Actual

Pre-acquisition (A)

Comparable

Comparable

2015

2015

2015

2014

2014

2014

% Variance

ALL HOTELS:

Rooms revenue (in thousands)

$ 62,575

$ 3,765

$ 66,340

$ 55,011

$ 8,488

$ 63,499

4.47%

RevPAR

$ 178.74

$ 278.91

$ 182.46

$ 161.30

$ 381.27

$ 174.78

4.39%

Occupancy

78.59%

72.02%

78.34%

79.01%

62.98%

78.03%

0.40%

ADR

$ 227.45

$ 387.25

$ 232.91

$ 204.15

$ 605.41

$ 224.00

3.98%

Year Ended

December 31,

Actual

Pre-acquisition

Comparable

Actual

Pre-acquisition (A)

Comparable

Comparable

2015

2015

2015

2014

2014

2014

% Variance

ALL HOTELS:

Rooms revenue (in thousands)

$ 255,443

$ 32,154

$ 287,597

$ 226,495

$ 41,250

$ 267,745

7.41%

RevPAR

$ 186.76

$ 432.43

$ 199.43

$ 171.37

$ 346.29

$ 185.83

7.32%

Occupancy

82.32%

79.67%

82.19%

81.62%

70.12%

80.67%

1.88%

ADR

$ 226.87

$ 542.81

$ 242.66

$ 209.96

$ 493.85

$ 230.36

5.34%

NOTES:

(1)

The above comparable information assumes the twelve hotel properties owned and included in the Company's operations at December 31, 2015 were owned as of the

beginning of each of the periods presented.

(2)

All pre-acquisition information was obtained from the prior owner. The Company performed a limited review of the information as part of its analysis of the acquisition.

FOOTNOTES:

(A)

These amounts include immaterial comparability adjustments to conform the Company's 2014 actual amounts to the industry's Uniform System of Accounts for the Lodging Industry Eleventh Revised Edition, which became effective January 1, 2015.

ASHFORD HOSPITALITY PRIME, INC. AND SUBSIDIARIES

HOTEL EBITDA

(dollars in thousands)

(unaudited)

ALL HOTELS:

Three Months Ended

December 31,

Actual

Pre-acquisition

Comparable

Actual

Pre-acquisition (A)

Comparable

Comparable

2015

2015

2015

2014

2014

2014

% Variance

REVENUE

Rooms

$ 62,575

$ 3,765

$ 66,340

$ 55,011

$ 8,488

$ 63,499

4.5%

Food and beverage

21,526

2,537

24,063

18,366

4,638

23,004

4.6%

Other

4,023

1,404

5,427

3,350

2,082

5,432

-0.1%

Total hotel revenue

88,124

7,706

95,830

76,727

15,208

91,935

4.2%

EXPENSES

Rooms

$ 14,446

$ 1,322

$ 15,768

$ 13,072

$ 2,027

$ 15,099

4.4%

Food and beverage

14,609

2,495

17,104

11,920

4,656

16,576

3.2%

Other direct

1,365

747

2,112

1,459

772

2,231

-5.3%

Other indirect

21,086

3,019

24,105

17,789

5,655

23,444

2.8%

Management fees, includes base and incentive fees

4,849

(42)

4,807

3,895

446

4,341

10.7%

Total hotel operating expenses

56,355

7,541

63,896

48,135

13,556

61,691

3.6%

Property taxes, insurance, and other

4,740

166

4,906

4,065

372

4,437

10.6%

HOTEL EBITDA

27,029

$ (1)

27,028

24,527

1,280

25,807

4.7%

Hotel EBITDA Margin

30.67%

-0.01%

28.20%

31.52%

8.42%

28.07%

0.13%

Minority interest in earnings of consolidated joint ventures

1,339

1,339

1,427

1,427

-6.2%

HOTEL EBITDA

excluding minority interest in joint ventures

$ 25,690

$ (1)

$ 25,689

$ 23,100

$ 1,281

$ 24,380

5.4%

ALL HOTELS:

Year Ended

December 31,

Actual

Pre-acquisition

Comparable

Actual

Pre-acquisition (A)

Comparable

Comparable

2015

2015

2015

2014

2014

2014

% Variance

REVENUE

Rooms

$ 255,443

$ 32,154

$ 287,597

$ 226,495

$ 41,250

$ 267,745

7.4%

Food and beverage

79,894

16,336

96,230

67,854

22,814

90,667

6.1%

Other

14,061

8,695

22,756

12,844

9,600

22,444

1.4%

Total hotel revenue

349,398

57,185

406,583

307,193

73,664

380,856

6.8%

EXPENSES

Rooms

$ 56,341

$ 8,882

$ 65,223

$ 51,636

$ 9,858

$ 61,494

6.1%

Food and beverage

53,535

14,614

68,149

44,297

20,751

65,048

4.8%

Other direct

4,476

3,957

8,433

5,466

3,803

9,269

-9.0%

Other indirect

80,211

17,853

98,064

68,420

24,479

92,898

5.6%

Management fees, includes base and incentive fees

21,847

1,869

23,716

17,924

2,280

20,204

17.4%

Total hotel operating expenses

216,410

47,175

263,585

187,743

61,171

248,913

5.9%

Property taxes, insurance, and other

18,453

1,289

19,742

16,163

2,214

18,377

7.4%

HOTEL EBITDA

114,535

8,721

123,256

103,287

10,279

113,566

8.5%

Hotel EBITDA Margin

32.78%

15.25%

30.32%

33.62%

13.95%

29.82%

0.50%

Minority interest in earnings of consolidated joint ventures

6,954

6,954

6,531

6,531

6.5%

HOTEL EBITDA

excluding minority interest in joint ventures

$ 107,581

$ 8,721

$ 116,302

$ 96,756

$ 10,279

$ 107,035

8.7%

NOTES:

(1)

The above comparable information assumes the twelve hotel properties owned and included in the Company's operations at December 31, 2015 were owned as of the

beginning of each of the periods presented.

(2)

All pre-acquisition information was obtained from the prior owner. The Company performed a limited review of the information as part of its analysis of the acquisition.

Adjustments have been made to the pre-acquisition results as indicated below:

(a) Management fee expense was adjusted to reflect current contractual rates

(b) Lease expense was adjusted to reflect additional expense from a below market rate ground lease on the Bardessono Hotel and Spa

(3)

See Exhibit 1 for reconciliation of net income (loss) to hotel EBITDA.

FOOTNOTES:

(A)

These amounts include immaterial comparability adjustments to conform the Company's 2014 actual amounts to the industry's Uniform System of Accounts for the Lodging Industry Eleventh Revised Edition, which became effective January 1, 2015.

ASHFORD HOSPITALITY PRIME, INC. AND SUBSIDIARIES

SELECTED FINANCIAL AND OPERATING INFORMATION BY PROPERTY

(in thousands, except operating information)

(unaudited)

THE FOLLOWING TABLE PRESENTS SELECTED FINANCIAL AND OPERATING INFORMATION BY PROPERTY FOR THE TWELVE PROPERTIES INCLUDED IN THE ASHFORD PRIME PORTFOLIO:

Three Months Ended December 31, 2015

Actual

Pre-acquisition

Comparable

Actual

Pre-acquisition (A)

Comparable

Comparable

2015

2015

2015

2014

2014

2014

% Variance

CAPITAL HILTON WASHINGTON DC

Selected Financial Information:

Rooms Revenue

$ 8,738

$ -

$ 8,738

$ 8,795

$ (64)

$ 8,731

0.08%

Total Hotel Revenue

$ 12,440

$ -

$ 12,440

$ 12,272

$ 299

$ 12,571

-1.04%

Hotel EBITDA

$ 3,033

$ -

$ 3,033

$ 3,549

$ -

$ 3,549

-14.54%

Hotel EBITDA Margin

24.38%

-

24.38%

28.92%

-

28.23%

-3.85%

Selected Operating Information:

RevPAR

$ 172.70

$ -

$ 172.70

$ 174.77

$ (1.28)

$ 173.49

-0.46%

Occupancy

79.48%

-

79.48%

81.58%

-

81.58%

-2.57%

ADR

$ 217.29

$ -

$ 217.29

$ 214.25

$ (1.57)

$ 212.68

2.17%

LA JOLLA HILTON TORREY PINES

Selected Financial Information:

Rooms Revenue

$ 5,072

$ -

$ 5,072

$ 4,734

$ (3)

$ 4,731

7.21%

Total Hotel Revenue

$ 9,266

$ -

$ 9,266

$ 8,546

$ 215

$ 8,761

5.76%

Hotel EBITDA

$ 2,321

$ -

$ 2,321

$ 2,161

$ -

$ 2,161

7.40%

Hotel EBITDA Margin

25.05%

-

25.05%

25.29%

-

24.67%

0.38%

Selected Operating Information:

RevPAR

$ 139.93

$ -

$ 139.93

$ 130.60

$ (0.09)

$ 130.51

7.22%

Occupancy

83.68%

-

83.68%

84.67%

-

84.67%

-1.17%

ADR

$ 167.22

$ -

$ 167.22

$ 154.24

$ (0.11)

$ 154.13

8.49%

CHICAGO SOFITEL WATER TOWER

Selected Financial Information:

Rooms Revenue

$ 6,605

$ -

$ 6,605

$ 7,144

$ -

$ 7,144

-7.54%

Total Hotel Revenue

$ 9,350

$ -

$ 9,350

$ 10,303

$ -

$ 10,303

-9.25%

Hotel EBITDA

$ 2,093

$ -

$ 2,093

$ 2,899

$ -

$ 2,899

-27.80%

Hotel EBITDA Margin

22.39%

-

22.39%

28.14%

-

28.14%

-5.75%

Selected Operating Information:

RevPAR

$ 173.00

$ -

$ 173.00

$ 187.11

$ -

$ 187.11

-7.54%

Occupancy

77.84%

-

77.84%

78.81%

-

78.81%

-1.22%

ADR

$ 222.24

$ -

$ 222.24

$ 237.43

$ -

$ 237.43

-6.40%

BARDESSONO HOTEL AND SPA

Selected Financial Information:

Rooms Revenue

$ 3,290

$ -

$ 3,290

$ -

$ 3,107

$ 3,107

5.89%

Total Hotel Revenue

$ 4,740

$ -

$ 4,740

$ -

$ 4,390

$ 4,390

7.97%

Hotel EBITDA

$ 1,193

$ -

$ 1,193

$ -

$ 902

$ 902

32.23%

Hotel EBITDA Margin

25.17%

-

25.17%

-

20.55%

20.55%

4.62%

Selected Operating Information:

RevPAR

$ 576.80

$ -

$ 576.80

$ -

$ 544.79

$ 544.79

5.88%

Occupancy

77.98%

-

77.98%

-

77.28%

77.28%

0.91%

ADR

$ 739.68

$ -

$ 739.68

$ -

$ 704.96

$ 704.96

4.92%

KEY WEST PIER HOUSE RESORT

Selected Financial Information:

Rooms Revenue

$ 4,581

$ -

$ 4,581

$ 4,203

$ -

$ 4,203

8.99%

Total Hotel Revenue

$ 5,691

$ -

$ 5,691

$ 5,365

$ -

$ 5,365

6.08%

Hotel EBITDA

$ 2,384

$ -

$ 2,384

$ 2,234

$ -

$ 2,234

6.71%

Hotel EBITDA Margin

41.89%

-

41.89%

41.64%

-

41.64%

0.25%

Selected Operating Information:

RevPAR

$ 350.64

$ -

$ 350.64

$ 321.70

$ -

$ 321.70

9.00%

Occupancy

89.11%

-

89.11%

86.28%

-

86.28%

3.27%

ADR

$ 393.50

$ -

$ 393.50

$ 372.84

$ -

$ 372.84

5.54%

PHILADELPHIA COURTYARD DOWNTOWN

Selected Financial Information:

Rooms Revenue

$ 6,731

$ -

$ 6,731

$ 6,355

$ -

$ 6,355

5.92%

Total Hotel Revenue

$ 8,310

$ -

$ 8,310

$ 7,867

$ 77

$ 7,944

4.61%

Hotel EBITDA

$ 3,252

$ -

$ 3,252

$ 2,966

$ -

$ 2,966

9.64%

Hotel EBITDA Margin

39.13%

-

39.13%

37.70%

-

37.34%

1.80%

Selected Operating Information:

RevPAR

$ 146.62

$ -

$ 146.62

$ 138.42

$ -

$ 138.42

5.92%

Occupancy

80.63%

-

80.63%

79.89%

-

79.89%

0.93%

ADR

$ 181.85

$ -

$ 181.85

$ 173.27

$ -

$ 173.27

4.95%

PLANO MARRIOTT LEGACY TOWN CENTER

Selected Financial Information:

Rooms Revenue

$ 4,811

$ -

$ 4,811

$ 4,404

$ -

$ 4,404

9.24%

Total Hotel Revenue

$ 7,858

$ -

$ 7,858

$ 7,500

$ 180

$ 7,680

2.32%

Hotel EBITDA

$ 2,568

$ -

$ 2,568

$ 2,556

$ -

$ 2,556

0.47%

Hotel EBITDA Margin

32.68%

-

32.68%

34.08%

-

33.28%

-0.60%

Selected Operating Information:

RevPAR

$ 129.44

$ -

$ 129.44

$ 118.49

$ -

$ 118.49

9.24%

Occupancy

66.92%

-

66.92%

66.22%

-

66.22%

1.06%

ADR

$ 193.43

$ -

$ 193.43

$ 178.93

$ -

$ 178.93

8.11%

SAN FRANCISCO COURTYARD DOWNTOWN

Selected Financial Information:

Rooms Revenue

$ 8,252

$ -

$ 8,252

$ 8,355

$ -

$ 8,355

-1.23%

Total Hotel Revenue

$ 9,653

$ -

$ 9,653

$ 9,698

$ 62

$ 9,760

-1.10%

Hotel EBITDA

$ 3,013

$ -

$ 3,013

$ 3,131

$ -

$ 3,131

-3.77%

Hotel EBITDA Margin

31.21%

-

31.21%

32.29%

-

32.08%

-0.87%

Selected Operating Information:

RevPAR

$ 221.48

$ -

$ 221.48

$ 224.22

$ -

$ 224.22

-1.22%

Occupancy

86.25%

-

86.25%

89.55%

-

89.55%

-3.68%

ADR

$ 256.79

$ -

$ 256.79

$ 250.39

$ -

$ 250.39

2.55%

SEATTLE COURTYARD DOWNTOWN

Selected Financial Information:

Rooms Revenue

$ 2,807

$ -

$ 2,807

$ 2,690

$ -

$ 2,690

4.35%

Total Hotel Revenue

$ 3,382

$ -

$ 3,382

$ 3,181

$ 7

$ 3,188

6.09%

Hotel EBITDA

$ 1,328

$ -

$ 1,328

$ 1,259

$ -

$ 1,259

5.48%

Hotel EBITDA Margin

39.27%

-

39.27%

39.58%

-

39.49%

-0.23%

Selected Operating Information:

RevPAR

$ 122.07

$ -

$ 122.07

$ 116.96

$ -

$ 116.96

4.37%

Occupancy

74.76%

-

74.76%

74.26%

-

74.26%

0.68%

ADR

$ 163.27

$ -

$ 163.27

$ 157.51

$ -

$ 157.51

3.66%

SEATTLE MARRIOTT WATERFRONT

Selected Financial Information:

Rooms Revenue

$ 5,550

$ -

$ 5,550

$ 5,050

$ -

$ 5,050

9.90%

Total Hotel Revenue

$ 8,033

$ -

$ 8,033

$ 6,969

$ 116

$ 7,085

13.38%

Hotel EBITDA

$ 2,919

$ -

$ 2,919

$ 2,521

$ -

$ 2,521

15.79%

Hotel EBITDA Margin

36.34%

-

36.34%

36.17%

-

35.58%

0.76%

Selected Operating Information:

RevPAR

$ 168.50

$ -

$ 168.50

$ 153.33

$ -

$ 153.33

9.89%

Occupancy

76.52%

-

76.52%

72.33%

-

72.33%

5.78%

ADR

$ 220.21

$ -

$ 220.21

$ 211.98

$ -

$ 211.98

3.88%

ST. THOMAS RITZ-CARLTON

Selected Financial Information:

Rooms Revenue

$ 2,642

$ 3,765

$ 6,407

$ -

$ 5,449

$ 5,449

17.58%

Total Hotel Revenue

$ 3,884

$ 7,706

$ 11,590

$ -

$ 9,729

$ 9,729

19.13%

Hotel EBITDA

$ 1,489

$ (1)

$ 1,488

$ -

$ 378

$ 378

293.62%

Hotel EBITDA Margin

38.34%

-0.01%

12.84%

-

3.89%

3.89%

8.95%

Selected Operating Information:

RevPAR

$ 863.30

$ 278.91

$ 386.89

$ -

$ 329.02

$ 329.02

17.59%

Occupancy

73.17%

72.02%

72.23%

-

58.05%

58.05%

24.44%

ADR

$ 1,179.85

$ 387.25

$ 535.61

$ -

$ 566.80

$ 566.80

-5.50%

TAMPA RENAISSANCE

Selected Financial Information:

Rooms Revenue

$ 3,495

$ -

$ 3,495

$ 3,282

$ -

$ 3,282

6.49%

Total Hotel Revenue

$ 5,517

$ -

$ 5,517

$ 5,026

$ 132

$ 5,158

6.96%

Hotel EBITDA

$ 1,436

$ -

$ 1,436

$ 1,251

$ -

$ 1,251

14.79%

Hotel EBITDA Margin

26.03%

-

26.03%

24.89%

-

24.25%

1.78%

Selected Operating Information:

RevPAR

$ 129.65

$ -

$ 129.65

$ 121.74

$ -

$ 121.74

6.50%

Occupancy

74.55%

-

74.55%

77.17%

-

77.17%

-3.40%

ADR

$ 173.90

$ -

$ 173.90

$ 157.75

$ -

$ 157.75

10.24%

PRIME PROPERTIES TOTAL (12)

Selected Financial Information:

Rooms Revenue

$ 62,575

$ 3,765

$ 66,340

$ 55,011

$ 8,488

$ 63,499

4.47%

Total Hotel Revenue

$ 88,124

$ 7,706

$ 95,830

$ 76,727

$ 15,208

$ 91,935

4.24%

Hotel EBITDA

$ 27,029

$ (1)

$ 27,028

$ 24,527

$ 1,280

$ 25,807

4.73%

Hotel EBITDA Margin

30.67%

-0.01%

28.20%

31.52%

8.42%

28.07%

0.13%

Selected Operating Information:

RevPAR

$ 178.74

$ 278.91

$ 182.46

$ 161.30

$ 381.27

$ 174.78

4.39%

Occupancy

78.59%

72.02%

78.34%

79.01%

62.98%

78.03%

0.40%

ADR

$ 227.45

$ 387.25

$ 232.91

$ 204.15

$ 605.41

$ 224.00

3.98%

NOTES:

(1)

The above comparable information assumes the twelve hotel properties owned and included in the Company's operations at December 31, 2015 were owned as of the

beginning of each of the periods presented.

(2)

All pre-acquisition information was obtained from the prior owner. The Company performed a limited review of the information as part of its analysis of the acquisition.

Adjustments have been made to the pre-acquisition results as indicated below:

(a) Management fee expense was adjusted to reflect current contractual rates

(b) Lease expense was adjusted to reflect additional expense from a below market rate ground lease on the Bardessono Hotel and Spa

(3)

See Exhibit 1 for reconciliation of net income (loss) to hotel EBITDA.

FOOTNOTES:

(A)

These amounts include immaterial comparability adjustments to conform the Company's 2014 actual amounts to the industry's Uniform System of Accounts for the Lodging Industry Eleventh Revised Edition, which became effective January 1, 2015.

ASHFORD HOSPITALITY PRIME, INC. AND SUBSIDIARIES

SELECTED FINANCIAL AND OPERATING INFORMATION BY PROPERTY

(in thousands, except operating information)

(unaudited)

THE FOLLOWING TABLE PRESENTS SELECTED FINANCIAL AND OPERATING INFORMATION BY PROPERTY FOR THE TWELVE PROPERTIES INCLUDED IN THE ASHFORD PRIME PORTFOLIO:

Year Ended December 31,

Actual

Pre-acquisition

Comparable

Actual

Pre-acquisition (A)

Comparable

Comparable

2015

2015

2015

2014

2014

2014

% Variance

CAPITAL HILTON WASHINGTON DC

Selected Financial Information:

Rooms Revenue

$ 38,045

$ -

$ 38,045

$ 37,060

$ (239)

$ 36,820

3.33%

Total Revenue

$ 54,423

$ -

$ 54,423

$ 50,920

$ 1,207

$ 52,127

4.40%

Hotel EBITDA

$ 15,297

$ -

$ 15,297

$ 15,183

$ -

$ 15,183

0.75%

Hotel EBITDA Margin

28.11%

-

28.11%

29.82%

-

29.13%

-1.02%

Selected Operating Information:

RevPAR

$ 189.88

$ -

$ 189.88

$ 186.11

$ (1.20)

$ 184.91

2.69%

Occupancy

85.43%

-

85.43%

84.76%

-

84.76%

0.79%

ADR

$ 222.26

$ -

$ 222.26

$ 219.56

$ (1.42)

$ 218.15

1.88%

LA JOLLA HILTON TORREY PINES

Selected Financial Information:

Rooms Revenue

$ 23,463

$ -

$ 23,463

$ 21,673

$ (99)

$ 21,574

8.76%

Total Revenue

$ 40,541

$ -

$ 40,541

$ 36,393

$ 794

$ 37,187

9.02%

Hotel EBITDA

$ 12,521

$ -

$ 12,521

$ 10,942

$ -

$ 10,942

14.43%

Hotel EBITDA Margin

30.88%

-

30.88%

30.07%

-

29.42%

1.46%

Selected Operating Information:

RevPAR

$ 163.15

$ -

$ 163.15

$ 150.71

$ (0.69)

$ 150.02

8.75%

Occupancy

85.35%

-

85.35%

84.50%

-

84.50%

1.00%

ADR

$ 191.16

$ -

$ 191.16

$ 178.35

$ (0.81)

$ 177.54

7.67%

CHICAGO SOFITEL WATER TOWER

Selected Financial Information:

Rooms Revenue

$ 26,980

$ -

$ 26,980

$ 25,534

$ 1,834

$ 27,368

-1.42%

Total Revenue

$ 37,322

$ -

$ 37,322

$ 36,635

$ 3,130

$ 39,765

-6.14%

Hotel EBITDA

$ 8,360

$ -

$ 8,360

$ 11,334

$ (428)

$ 10,906

-23.34%

Hotel EBITDA Margin

22.40%

-

22.40%

30.94%

-13.67%

27.43%

-5.03%

Selected Operating Information:

RevPAR

$ 178.11

$ -

$ 178.11

$ 197.84

$ 81.87

$ 180.68

-1.42%

Occupancy

80.03%

-

80.03%

84.21%

58.81%

80.45%

-0.53%

ADR

$ 222.55

$ -

$ 222.55

$ 234.93

$ 139.20

$ 224.57

-0.90%

BARDESSONO HOTEL AND SPA

Selected Financial Information:

Rooms Revenue

$ 6,855

$ 5,914

$ 12,769

$ -

$ 12,124

$ 12,124

5.32%

Total Revenue

$ 9,684

$ 8,806

$ 18,490

$ -

$ 17,212

$ 17,212

7.43%

Hotel EBITDA

$ 2,791

$ 1,054

$ 3,845

$ -

$ 3,733

$ 3,733

3.00%

Hotel EBITDA Margin

28.82%

11.97%

20.80%

-

21.69%

21.69%

-0.89%

Selected Operating Information:

RevPAR

$ 628.17

$ 504.69

$ 564.23

$ -

$ 535.76

$ 535.76

5.31%

Occupancy

79.69%

77.82%

78.72%

-

79.09%

79.09%

-0.46%

ADR

$ 788.25

$ 648.53

$ 716.73

$ -

$ 677.44

$ 677.44

5.80%

KEY WEST PIER HOUSE RESORT

Selected Financial Information:

Rooms Revenue

$ 18,549

$ -

$ 18,549

$ 13,877

$ 3,416

$ 17,293

7.26%

Total Revenue

$ 23,192

$ -

$ 23,192

$ 17,669

$ 4,260

$ 21,929

5.76%

Hotel EBITDA

$ 9,728

$ -

$ 9,728

$ 6,701

$ 1,938

$ 8,639

12.61%

Hotel EBITDA Margin

41.95%

-

41.95%

37.93%

45.49%

39.40%

2.55%

Selected Operating Information:

RevPAR

$ 357.88

$ -

$ 357.88

$ 319.37

$ 407.75

$ 333.66

7.26%

Occupancy

90.15%

-

90.15%

85.18%

93.63%

86.55%

4.16%

ADR

$ 396.99

$ -

$ 396.99

$ 374.92

$ 435.51

$ 385.52

2.98%

PHILADELPHIA COURTYARD DOWNTOWN

Selected Financial Information:

Rooms Revenue

$ 26,461

$ -

$ 26,461

$ 23,997

$ -

$ 23,997

10.27%

Total Revenue

$ 32,044

$ -

$ 32,044

$ 29,379

$ 273

$ 29,652

8.07%

Hotel EBITDA

$ 12,518

$ -

$ 12,518

$ 11,312

$ (1)

$ 11,311

10.67%

Hotel EBITDA Margin

39.07%

-

39.07%

38.50%

-

38.15%

0.92%

Selected Operating Information:

RevPAR

$ 145.28

$ -

$ 145.28

$ 131.81

$ -

$ 131.81

10.22%

Occupancy

82.62%

-

82.62%

79.40%

-

79.40%

4.05%

ADR

$ 175.85

$ -

$ 175.85

$ 166.01

$ -

$ 166.01

5.93%

PLANO MARRIOTT LEGACY TOWN CENTER

Selected Financial Information:

Rooms Revenue

$ 20,263

$ -

$ 20,263

$ 18,222

$ -

$ 18,222

11.20%

Total Revenue

$ 32,033

$ -

$ 32,033

$ 28,879

$ 594

$ 29,473

8.69%

Hotel EBITDA

$ 11,087

$ -

$ 11,087

$ 9,876

$ -

$ 9,876

12.26%

Hotel EBITDA Margin

34.61%

-

34.61%

34.20%

-

33.51%

1.10%

Selected Operating Information:

RevPAR

$ 137.41

$ -

$ 137.41

$ 123.57

$ -

$ 123.57

11.20%

Occupancy

71.03%

-

71.03%

69.12%

-

69.12%

2.76%

ADR

$ 193.45

$ -

$ 193.45

$ 178.78

$ -

$ 178.78

8.21%

SAN FRANCISCO COURTYARD DOWNTOWN

Selected Financial Information:

Rooms Revenue

$ 35,988

$ -

$ 35,988

$ 33,984

$ -

$ 33,984

5.90%

Total Revenue

$ 41,938

$ -

$ 41,938

$ 39,148

$ 238

$ 39,386

6.48%

Hotel EBITDA

$ 13,688

$ -

$ 13,688

$ 13,065

$ 1

$ 13,066

4.76%

Hotel EBITDA Margin

32.64%

-

32.64%

33.37%

-

33.17%

-0.54%

Selected Operating Information:

RevPAR

$ 243.45

$ -

$ 243.45

$ 229.90

$ -

$ 229.90

5.89%

Occupancy

91.10%

-

91.10%

89.89%

-

89.89%

1.34%

ADR

$ 267.24

$ -

$ 267.24

$ 255.75

$ -

$ 255.75

4.49%

SEATTLE COURTYARD DOWNTOWN

Selected Financial Information:

Rooms Revenue

$ 14,153

$ -

$ 14,153

$ 13,194

$ -

$ 13,194

7.27%

Total Revenue

$ 16,259

$ -

$ 16,259

$ 15,339

$ 36

$ 15,375

5.75%

Hotel EBITDA

$ 6,561

$ -

$ 6,561

$ 6,209

$ -

$ 6,209

5.67%

Hotel EBITDA Margin

40.35%

-

40.35%

40.48%

-

40.38%

-0.03%

Selected Operating Information:

RevPAR

$ 155.10

$ -

$ 155.10

$ 144.59

$ -

$ 144.59

7.27%

Occupancy

79.39%

-

79.39%

80.35%

-

80.35%

-1.19%

ADR

$ 195.37

$ -

$ 195.37

$ 179.94

$ -

$ 179.94

8.57%

SEATTLE MARRIOTT WATERFRONT

Selected Financial Information:

Rooms Revenue

$ 27,419

$ -

$ 27,419

$ 25,044

$ -

$ 25,044

9.48%

Total Revenue

$ 36,144

$ -

$ 36,144

$ 32,103

$ 399

$ 32,502

11.21%

Hotel EBITDA

$ 14,640

$ -

$ 14,640

$ 13,016

$ -

$ 13,016

12.48%

Hotel EBITDA Margin

40.50%

-

40.50%

40.54%

-

40.05%

0.46%

Selected Operating Information:

RevPAR

$ 209.84

$ -

$ 209.84

$ 191.66

$ -

$ 191.66

9.49%

Occupancy

82.22%

-

82.22%

79.67%

-

79.67%

3.20%

ADR

$ 255.20

$ -

$ 255.20

$ 240.56

$ -

$ 240.56

6.09%

ST. THOMAS RITZ-CARLTON

Selected Financial Information:

Rooms Revenue

$ 2,642

$ 26,240

$ 28,882

$ -

$ 24,213

$ 24,213

19.28%

Total Revenue

$ 3,884

$ 48,379

$ 52,263

$ -

$ 45,033

$ 45,033

16.05%

Hotel EBITDA

$ 1,489

$ 7,667

$ 9,156

$ -

$ 5,036

$ 5,036

81.80%

Hotel EBITDA Margin

38.34%

15.85%

17.52%

-

11.18%

11.18%

6.34%

Selected Operating Information:

RevPAR

$ 863.30

$ 418.91

$ 439.61

$ -

$ 368.54

$ 368.54

19.28%

Occupancy

73.17%

80.01%

79.69%

-

67.89%

67.89%

17.38%

ADR

$ 1,179.85

$ 523.57

$ 551.63

$ -

$ 542.82

$ 542.82

1.62%

TAMPA RENAISSANCE

Selected Financial Information:

Rooms Revenue

$ 14,625

$ -

$ 14,625

$ 13,910

$ -

$ 13,910

5.14%

Total Revenue

$ 21,934

$ -

$ 21,934

$ 20,726

$ 492

$ 21,218

3.37%

Hotel EBITDA

$ 5,855

$ -

$ 5,855

$ 5,649

$ -

$ 5,649

3.65%

Hotel EBITDA Margin

26.69%

-

26.69%

27.26%

-

26.62%

0.07%

Selected Operating Information:

RevPAR

$ 136.75

$ -

$ 136.75

$ 130.07

$ -

$ 130.07

5.14%

Occupancy

77.96%

-

77.96%

80.38%

-

80.38%

-3.00%

ADR

$ 175.40

$ -

$ 175.40

$ 161.82

$ -

$ 161.82

8.39%

PRIME PROPERTIES TOTAL (12)

Selected Financial Information:

Rooms Revenue

$ 255,443

$ 32,154

$ 287,597

$ 226,495

$ 41,250

$ 267,745

7.41%

Total Hotel Revenue

$ 349,398

$ 57,185

$ 406,583

$ 307,193

$ 73,663

$ 380,856

6.76%

Hotel EBITDA

$ 114,535

$ 8,721

$ 123,256

$ 103,287

$ 10,279

$ 113,566

8.53%

Hotel EBITDA Margin

32.78%

15.25%

30.31%

33.62%

13.95%

29.82%

0.50%

Selected Operating Information:

RevPAR

$ 186.76

$ 432.43

$ 199.43

$ 171.37

$ 346.29

$ 185.83

7.32%

Occupancy

82.32%

79.67%

82.19%

81.62%

70.12%

80.67%

1.88%

ADR

$ 226.87

$ 542.81

$ 242.66

$ 209.96

$ 493.85

$ 230.36

5.34%

NOTES:

(1)

The above comparable information assumes the twelve hotel properties owned and included in the Company's operations at December 31, 2015 were owned as of the

beginning of each of the periods presented.

(2)

All pre-acquisition information was obtained from the prior owner. The Company performed a limited review of the information as part of its analysis of the acquisition.

Adjustments have been made to the pre-acquisition results as indicated below:

(a) Management fee expense was adjusted to reflect current contractual rates

(b) Lease expense was adjusted to reflect additional expense from a below market rate ground lease on the Bardessono Hotel and Spa

(3)

See Exhibit 1 for reconciliation of net income (loss) to hotel EBITDA.

FOOTNOTES:

(A)

These amounts include immaterial comparability adjustments to conform the Company's 2014 actual amounts to the industry's Uniform System of Accounts for the Lodging Industry Eleventh Revised Edition, which became effective January 1, 2015.

ASHFORD HOSPITALITY PRIME, INC. AND SUBSIDIARIES

HOTEL REVENUE & EBITDA FOR TRAILING TWELVE MONTHS

(dollars in thousands)

(unaudited)

THE FOLLOWING SEASONALITY TABLE REFLECTS THE TWELVE HOTELS INCLUDED IN THE COMPANY'S OPERATIONS AT DECEMBER 31, 2015:

Actual

Pre-acquisition

Comparable

Actual

Pre-acquisition

Comparable

Actual

Pre-acquisition

Comparable

Actual

Pre-acquisition

Comparable

2015

2015

2015

2015

2015

2015

2015

2015

2015

2015

2015

2015

4th Quarter

4th Quarter

4th Quarter

3rd Quarter

3rd Quarter

3rd Quarter

2nd Quarter

2nd Quarter

2nd Quarter

1st Quarter

1st Quarter

1st Quarter

Total Hotel Revenue

$ 88,124

$ 7,706

$ 95,830

$ 90,725

$ 10,597

$ 101,322

$ 92,800

$ 18,719

$ 111,519

$ 77,749

$ 20,163

$ 97,912

Hotel EBITDA

$ 27,029

$ (1)

$ 27,028

$ 30,081

$ 774

$ 30,855

$ 33,902

$ 3,457

$ 37,359

$ 23,523

$ 4,491

$ 28,014

Hotel EBITDA Margin

30.67%

-0.01%

28.20%

33.16%

7.30%

30.45%

36.53%

18.47%

33.50%

30.26%

22.27%

28.61%

EBITDA % of Total TTM

23.6%

0.0%

21.9%

26.3%

8.9%

25.0%

29.6%

39.6%

30.3%

20.5%

51.5%

22.7%

JV Interests in EBITDA

$ 1,339

$ -

$ 1,339

$ 1,427

$ -

$ 1,427

$ 2,513

$ -

$ 2,513

$ 1,675

$ -

$ 1,675

Actual

Pre-acquisition

Comparable

2015

2015

2015

TTM

TTM

TTM

Total Hotel Revenue

$ 349,398

$ 57,185

$ 406,583

Hotel EBITDA

$ 114,535

$ 8,721

$ 123,256

Hotel EBITDA Margin

32.78%

15.25%

30.32%

EBITDA % of Total TTM

100.0%

100.0%

100.0%

JV Interests in EBITDA

$ 6,954

$ -

$ 6,954

NOTES:

(1)

The above comparable information assumes the twelve hotel properties owned and included in the Company's operations at December 31, 2015 were owned as of the beginning of each of the periods presented.

(2)

All pre-acquisition information was obtained from the prior owner. The Company performed a limited review of the information as part of its analysis of the acquisition.

Adjustments have been made to the pre-acquisition results as indicated below:

(a) Management fee expense was adjusted to reflect current contractual rates

(b) Lease expense was adjusted to reflect additional expense from a below market rate ground lease on the Bardessono Hotel and Spa

(3)

See Exhibit 1 for reconciliation of net income (loss) to hotel EBITDA.

ASHFORD HOSPITALITY PRIME, INC. AND SUBSIDIARIES

TOTAL ENTERPRISE VALUE

DECEMBER 31, 2015

(in thousands, except share price)

(unaudited)

December 31,

2015

End of quarter common shares outstanding

28,472

Partnership units outstanding (common stock equivalents)

4,375

Combined common shares and partnership units outstanding

32,847

Common stock price at quarter end

$ 14.50

Market capitalization at quarter end

$ 476,282

Series B convertible preferred stock

$ 65,000

Debt on balance sheet date

$ 840,232

Joint venture partner's share of consolidated debt

$ (48,840)

Net working capital (see below)

$ (168,647)

Total enterprise value (TEV)

$ 1,164,027

Ashford Inc. Investment:

Common stock owned at end of quarter

195

Common stock price at quarter end

$ 53.25

Market value of Ashford Inc. investment

$ 10,377

Cash and cash equivalents

$ 101,623

Restricted cash

31,733

Accounts receivable, net

12,594

Prepaid expenses

2,964

Investment in AIM REHE, LP

48,365

Due from affiliates, net

(5,782)

Due from third-party hotel managers, net

9,818

Market value of Ashford Inc. investment

10,377

Total current assets

$ 211,693

Accounts payable, net & accrued expenses

$ 39,607

Dividends payable

3,439

Total current liabilities

$ 43,046

Net working capital*

$ 168,647

* Includes the Company's pro rata share of net working capital in joint ventures.

ASHFORD HOSPITALITY PRIME, INC. AND SUBSIDIARIES

Anticipated Capital Expenditures Calendar (a)

2015

Proposed 2016

Rooms

1st Quarter

2nd Quarter

3rd Quarter

4th Quarter

1st Quarter

2nd Quarter

3rd Quarter

4th Quarter

Actual

Actual

Actual

Actual

Estimated

Estimated

Estimated

Estimated

Courtyard Seattle

250

x

Hilton La Jolla Torrey Pines

394

x

Renaissance Tampa

293

x

Courtyard San Francisco

405

x

Marriott Seattle Waterfront

358

x

(a) Only hotels which have had or are expected to have significant capital expenditures that could result in displacement in 2015-2016 are included in this table.

Exhibit 1

ASHFORD HOSPITALITY PRIME, INC. AND SUBSIDIARIES

RECONCILIATION OF NET INCOME (LOSS) TO HOTEL EBITDA

(in thousands)

(unaudited)

Three Months Ended December 31, 2015

Capital Hilton Washington DC

La Jolla Hilton Torrey Pines

Chicago Sofitel Water Tower

Bardessono Hotel & Spa

Key West Pier House Resort

Philadelphia Courtyard Downtown

Plano Marriott Legacy Town Center

San Francisco Courtyard Downtown

Seattle Courtyard Downtown

Seattle Marriott Waterfront

St. Thomas Ritz-Carlton

Tampa Renaissance

Hotel Total

Corporate / Allocated

Ashford Hospitality Prime, Inc.

Net income (loss)

$ 1,312

$ 1,002

$ (223)

$ 461

$ 1,757

$ 1,286

$ 1,486

$ 2,435

$ 779

$ 1,797

$ 1,032

$ 564

$ 13,688

$ (19,796)

$ (6,108)

Income from consolidated entities attributable to noncontrolling interest

(358)

(274)

-

-

-

-

-

-

-

-

-

-

(632)

(714)

(1,346)

Net loss attributable to redeemable noncontrolling interests in operating partnership

-

-

-

-

-

-

-

-

-

-

-

-

-

1,064

1,064

Net income (loss) attributable to the Company

954

728

(223)

461

1,757

1,286

1,486

2,435

779

1,797

1,032

564

13,056

(19,446)

(6,390)

Non-property adjustments

(21)

2

1

-

-

-

-

-

(1)

-

5

-

(14)

14

-

Interest Income

-

(2)

-

-

-

(1)

-

(3)

-

(2)

(1)

-

(9)

(4)

(13)

Interest expense

-

-

516

-

-

505

-

-

-

-

104

-

1,125

7,904

9,029

Amortization of loan cost

-

-

176

-

-

8

-

-

-

-

10

-

194

546

740

Depreciation and amortization

1,562

1,499

1,584

578

662

1,448

1,035

578

533

976

114

871

11,440

-

11,440

Income tax expense (benefit)

69

(196)

-

-

-

4

-

-

-

-

37

-

(86)

(22)

(108)

Non-Hotel EBITDA ownership expense

113

16

39

154

(35)

2

47

3

17

148

188

1

693

(693)

-

(Income) loss from consolidated entities attributable to noncontrolling interest

356

274

-

-

-

-

-

-

-

-

-

-

630

(630)

-

EBITDA including amounts attributable to consolidated noncontrolling interest

3,033

2,321

2,093

1,193

2,384

3,252

2,568

3,013

1,328

2,919

1,489

1,436

27,029

(12,331)

14,698

Less: EBITDA adjustments attributable to consolidated noncontrolling interest

(360)

(351)

-

-

-

-

-

-

-

-

-

-

(711)

(384)

(1,095)

Net income (loss) attributable to redeemable noncontrolling interest in operating partnership

-

-

-

-

-

-

-

-

-

-

-

-

-

(1,064)

(1,064)

EBITDA attributable to the Company and OP unitholders

$ 2,673

$ 1,970

$ 2,093

$ 1,193

$ 2,384

$ 3,252

$ 2,568

$ 3,013

$ 1,328

$ 2,919

$ 1,301

$ 1,436

$ 26,318

$ (13,779)

$ 12,539

Pre-acquisition Hotel EBITDA

-

-

-

-

-

-

-

-

-

-

(1)

-

(1)

Comparable Hotel EBITDA

$ 3,033

$ 2,321

$ 2,093

$ 1,193

$ 2,384

$ 3,252

$ 2,568

$ 3,013

$ 1,328

$ 2,919

$ 1,488

$ 1,436

$ 27,028

NOTES:

(1) The above comparable information assumes the twelve hotel properties owned and included in the Company's operations at December 31, 2015 were owned as of the beginning of each of the periods presented.

(2) All pre-acquisition information was obtained from the prior owner. The Company performed a limited review of the information as part of its analysis of the acquisition.

Adjustments have been made to the pre-acquisition results as indicated below:

(a) Management fee expense was adjusted to reflect current contractual rates

(b) Lease expense was adjusted to reflect additional expense from a below market rate ground lease on the Bardessono Hotel and Spa

Exhibit 1

ASHFORD HOSPITALITY PRIME, INC. AND SUBSIDIARIES

RECONCILIATION OF NET INCOME (LOSS) TO HOTEL EBITDA

(in thousands)

(unaudited)

Three Months Ended December 31, 2014

Capital Hilton Washington DC

La Jolla Hilton Torrey Pines

Chicago Sofitel Water Tower

Bardessono Hotel & Spa

Key West Pier House Resort

Philadelphia Courtyard Downtown

Plano Marriott Legacy Town Center

San Francisco Courtyard Downtown

Seattle Courtyard Downtown

Seattle Marriott Waterfront

St. Thomas Ritz-Carlton

Tampa Renaissance

Hotel Total

Corporate / Allocated

Ashford Hospitality Prime, Inc.

Net income (loss)

$ 1,467

$ 543

$ 674

$ -

$ 1,604

$ 984

$ 1,548

$ 2,575

$ 774

$ 1,528

$ -

$ 673

$ 12,370

$ (13,295)

$ (925)

Income from consolidated entities attributable to noncontrolling interest

(394)

(159)

-

-

-

-

-

-

-

-

-

-

(553)

(1,291)

(1,844)

Net loss attributable to redeemable noncontrolling interests in operating partnership

-

-

-

-

-

-

-

-

-

-

-

-

-

717

717

Net income (loss) attributable to the Company

1,073

384

674

-

1,604

984

1,548

2,575

774

1,528

-

673

11,817

(13,869)

(2,052)

Non-property adjustments

(12)

1

(1)

-

-

-

1

-

(11)

1

-

(1)

(22)

22

-

Interest Income

2

(1)

-

-

-

-

(1)

(3)

-

(2)

-

(1)

(6)

(1)

(7)

Interest expense

-

-

502

-

-

512

-

-

-

-

-

-

1,014

8,358

9,372

Amortization of loan cost

-

-

166

-

-

8

-

-

-

-

-

-

174

326

500

Depreciation and amortization

1,813

1,474

1,557

-

622

1,463

1,002

558

496

986

-

579

10,550

-

10,550

Income tax expense

28

129

-

-

-

3

-

-

-

-

-

-

160

315

475

Non-Hotel EBITDA ownership expense

252

15

1

-

8

(4)

6

1

-

8

-

1

288

(288)

-

(Income) loss from consolidated entities attributable to noncontrolling interest

393

159

-

-

-

-

-

-

-

-

-

-

552

(552)

-

EBITDA including amounts attributable to consolidated noncontrolling interest

3,549

2,161

2,899

-

2,234

2,966

2,556

3,131

1,259

2,521

-

1,251

24,527

(5,689)

18,838

Less: EBITDA adjustments attributable to consolidated noncontrolling interest

(428)

(345)

-

-

-

-

-

-

-

-

-

-

(773)

(419)

(1,192)

Net income (loss) attributable to redeemable noncontrolling interest in operating partnership

-

-

-

-

-

-

-

-

-

-

-

-

-

(717)

(717)

EBITDA attributable to the Company and OP unitholders

$ 3,121

$ 1,816

$ 2,899

$ -

$ 2,234

$ 2,966

$ 2,556

$ 3,131

$ 1,259

$ 2,521

$ -

$ 1,251

$ 23,754

$ (6,825)

$ 16,929

Pre-acquisition Hotel EBITDA (A)

-

-

-

902

-

-

-

-

-

-

378

-

1,280

Comparable Hotel EBITDA

$ 3,549

$ 2,161

$ 2,899

$ 902

$ 2,234

$ 2,966

$ 2,556

$ 3,131

$ 1,259

$ 2,521

$ 378

$ 1,251

$ 25,807

-

NOTES:

(1) The above comparable information assumes the twelve hotel properties owned and included in the Company's operations at December 31, 2015 were owned as of the beginning of each of the periods presented.

(2) All pre-acquisition information was obtained from the prior owner. The Company performed a limited review of the information as part of its analysis of the acquisition.

Adjustments have been made to the pre-acquisition results as indicated below:

(a) Management fee expense was adjusted to reflect current contractual rates

(b) Lease expense was adjusted to reflect additional expense from a below market rate ground lease on the Bardessono Hotel and Spa

FOOTNOTES:

(A) Pre-acquisition Hotel EBITDA amounts include immaterial adjustments to conform the Company's 2014 actual amounts to the industry's Uniform System of Accounts

for the Lodging Industry Eleventh Revised Edition, which became effective January 1, 2015.

Exhibit 1

ASHFORD HOSPITALITY PRIME, INC. AND SUBSIDIARIES

RECONCILIATION OF NET INCOME (LOSS) TO HOTEL EBITDA

(in thousands)

(unaudited)

Year Ended December 31, 2015

Capital Hilton Washington DC

La Jolla Hilton Torrey Pines

Chicago Sofitel Water Tower

Bardessono Hotel & Spa

Key West Pier House Resort

Philadelphia Courtyard Downtown

Plano Marriott Legacy Town Center

San Francisco Courtyard Downtown

Seattle Courtyard Downtown

Seattle Marriott Waterfront

St. Thomas Ritz-Carlton

Tampa Renaissance

Hotel Total

Corporate / Allocated

Ashford Hospitality Prime, Inc.

Net income (loss)

$ 8,222

$ 6,684

$ (714)

$ 1,358

$ 7,124

$ 4,691

$ 6,854

$ 11,415

$ 4,453

$ 10,441

$ 1,032

$ 2,820

$ 64,380

$ (69,071)

$ (4,691)

(Income) loss from consolidated entities attributable to noncontrolling interest

(2,173)

(1,766)

-

-

-

-

-

-

-

-

-

-

(3,939)

1,525

(2,414)

Net loss attributable to redeemable noncontrolling interests in operating partnership

-

-

-

-

-

-

-

-

-

-

-

-

-

393

393

Net income (loss) attributable to the Company

6,049

4,918

(714)

1,358

7,124

4,691

6,854

11,415

4,453

10,441

1,032

2,820

60,441

(67,153)

(6,712)

Non-property adjustments

(19)

-

(1)

1

-

-

-

1

(1)

(2)

4

1

(16)

16

-

Interest Income

(1)

(2)

-

-

-

(2)

(1)

(13)

-

(7)

-

(2)

(28)

(6)

(34)

Interest expense

-

-

2,022

-

-

2,013

-

-

-

-

104

-

4,139

31,115

35,254

Amortization of loan cost

-

-

698

-

-

32

-

-

-

-

10

-

740

1,835

2,575

Depreciation and amortization

6,524

5,819

6,296

1,177

2,629

5,761

4,109

2,278

2,091

4,004

114

3,022

43,824

-

43,824

Income tax expense (benefit)

69

(25)

-

-

-

16

-

-

-

-

37

-

97

166

263

Non-Hotel EBITDA ownership expense

502

45

59

255

(25)

7

125

7

18

204

188

14

1,399

(1,399)

-

(Income) loss from consolidated entities attributable to noncontrolling interest

2,173

1,766

-

-

-

-

-

-

-

-

-

-

3,939

(3,939)

-

EBITDA including amounts attributable to consolidated noncontrolling interest

15,297

12,521

8,360

2,791

9,728

12,518

11,087

13,688

6,561

14,640

1,489

5,855

114,535

(39,365)

75,170

Less: EBITDA adjustments attributable to consolidated noncontrolling interest

(1,513)

(1,360)

-

-

-

-

-

-

-

-

-

-

(2,873)

(1,521)

(4,394)

Net income (loss) attributable to redeemable noncontrolling interest in operating partnership

-

-

-

-

-