RLJ Lodging Trust Reports First Quarter 2014 Results

RLJ Lodging Trust (the “Company”) (NYSE: RLJ) today reported results for the three months ended March 31, 2014.

First Quarter Highlights

• Pro forma RevPAR increased 6.0%, Pro forma ADR increased 3.3%, and Pro forma Occupancy increased 2.7%
• Adjusting for renovation disruption in the quarter, Pro forma RevPAR is estimated to have increased approximately 90 basis points to 6.9%
• Pro forma Hotel EBITDA Margin of 31.8%
• Pro forma Consolidated Hotel EBITDA increased 4.0% to $78.1 million
• Adjusted FFO increased 21.5% to $53.5 million
• Completed an acquisition of a 10-hotel Hyatt-branded portfolio for approximately $312.5 million and the disposition of 13 non-strategic hotels for approximately $114.5 million
• Declared a regular quarterly cash dividend of $0.22 per share, an increase of approximately 7.3% over the prior quarter's regular dividend

“We started 2014 with very strong momentum. We completed several key transactions in addition to once again reporting strong operational results,” commented Thomas J. Baltimore, Jr., President and Chief Executive Officer. “We reinvested the proceeds from the sale of 13 non-strategic properties into 10 properties that increase our presence in high-growth markets. The results have been immediately accretive and provide us with a very solid foundation for future growth.”

Financial and Operating Results

Performance metrics such as Occupancy, Average Daily Rate (“ADR”), Revenue Per Available Room (“RevPAR”), Hotel EBITDA, and Hotel EBITDA Margin are pro forma. The prefix “pro forma” as defined by the Company, denotes operating results which include results for periods prior to its ownership. Pro forma RevPAR and Pro forma Hotel EBITDA Margin are reported on a comparable basis and therefore exclude hotels sold during the period and non-comparable hotels that were not open for operation or closed for renovations for comparable periods. Explanations of EBITDA, Adjusted EBITDA, Hotel EBITDA, FFO, and Adjusted FFO, as well as reconciliations of those measures to net income or loss, if applicable, are included at the end of this release.

Pro forma RevPAR for the three months ended March 31, 2014, increased 6.0% over the comparable period in 2013, driven by a Pro forma ADR increase of 3.3% and a Pro forma Occupancy increase of 2.7%. Adjusting for disruption caused by recent renovations, the Company estimates that RevPAR growth would have increased by an additional 90 basis points to 6.9%. Among the Company’s top six markets, the best performers in the quarter were Denver and Washington, D.C., which experienced RevPAR growth of 13.3% and 9.0%, respectively.

Pro forma Hotel EBITDA Margin for the three months ended March 31, 2014, decreased 28 basis points over the comparable period in 2013 to 31.8%, adjusted to normalize 2013 ground rent at the Courtyard Waikiki Beach.

Pro forma Consolidated Hotel EBITDA includes the results of non-comparable hotels and is adjusted to normalize 2013 ground rent at the Courtyard Waikiki Beach. For the three months ended March 31, 2014, Pro forma Consolidated Hotel EBITDA increased $3.0 million to $78.1 million, representing a 4.0% increase over the comparable period in 2013.

Adjusted EBITDA for the three months ended March 31, 2014, increased $6.1 million to $67.4 million, representing a 9.9% increase over the comparable period in 2013.

Adjusted FFO for the three months ended March 31, 2014, increased $9.5 million to $53.5 million, representing a 21.5% increase over the comparable period in 2013.

Adjusted FFO per diluted share and unit for the three months ended March 31, 2014, was $0.43 based on the Company’s diluted weighted-average common shares and units outstanding of 123.8 million.

Non-recurring items which are noteworthy for the three months ended March 31, 2014, include a loss on disposal of $2.6 million and approximately $1.1 million primarily related to the loss on defeasance and accelerated amortization of deferred financing fees, both of which are associated with non-strategic hotels sold during the quarter.

Non-recurring items are included in net income attributable to common shareholders but have been excluded from Adjusted EBITDA and Adjusted FFO, as applicable. A complete listing is provided in the Non-GAAP reconciliation tables for the three months ended March 31, 2014 and 2013.

Net income attributable to common shareholders for the three months ended March 31, 2014, was $11.9 million compared to $8.5 million in the comparable period in 2013.

Net cash flow from operating activities for the three months ended March 31, 2014, totaled $31.6 million compared to $34.0 million for the comparable period in 2013.

Acquisitions/Dispositions

During the three months ended March 31, 2014, the Company acquired a 10-hotel portfolio for approximately $312.5 million and sold 13 hotels for approximately $114.5 million.

On March 12, 2014, the Company acquired 10 Hyatt, Hyatt Place, and Hyatt House-branded hotels totaling 1,560 rooms for approximately $312.5 million, or approximately $200,000 per key. The portfolio consists of high-performing and well-situated hotels, the majority of which are located on the West Coast. With the addition of this portfolio, the Company expects to more than double its Hotel EBITDA generated from the West Coast.

On February 20, 2014, the Company sold an 11-hotel portfolio consisting of 1,205 rooms for approximately $84.8 million. The sale price, adjusted for pending capital expenditures, represents a capitalization rate of approximately 7.9% on the portfolio's 2013 net operating income.

On February 25, 2014, the Company sold the 150-room Hilton Garden Inn St. George in St. George, Utah for approximately $15.7 million. The sale price, adjusted for pending capital expenditures, represents a capitalization rate of approximately 8.7% on the hotel's 2013 net operating income.

On March 26, 2014, the Company sold the 182-room Hilton Mystic in Mystic, Connecticut for approximately $14.1 million. The sale price, adjusted for pending capital expenditures, represents a capitalization rate of approximately 7.4% on the hotel's projected 2014 net operating income.

Balance Sheet

In March 2014, the Company amended its credit agreement to extend the maturity date of its 2012 Five-Year Term Loan from November 20, 2017 to March 20, 2019, expand the accordion feature, and reduce the applicable margin by 15 basis points. The Company also exercised the accordion feature of its 2012 Five-Year Term Loan and 2013 Five-Year Term Loan, resulting in proceeds of $175.0 million.

As of March 31, 2014, the Company had $270.8 million of unrestricted cash on its balance sheet, $300.0 million available on its revolving credit facility, and $1.6 billion of debt outstanding. The Company’s ratio of net debt to Adjusted EBITDA for the trailing twelve month period was 3.9 times.

Dividends

The Company’s Board of Trustees declared a cash dividend of $0.22 per common share of beneficial interest. The dividend was paid on April 15, 2014, to shareholders of record as of March 31, 2014, and represents an increase of approximately 7.3% over the prior quarter's regular dividend of $.205.

2014 Outlook

The Company’s outlook has been updated to reflect recent acquisition and disposition activity. The outlook excludes any potential future acquisition and disposition, which could result in a material change to the Company’s outlook. The 2014 outlook is also based on a number of other assumptions, many of which are outside the Company’s control and all of which are subject to change.

Pro forma operating statistics include results for periods prior to the Company’s ownership and therefore assume the hotels were owned since January 1, 2013. Pro forma Consolidated Hotel EBITDA includes approximately $4.5 million of prior ownership Hotel EBITDA for 10 recently acquired hotels that is not included in the Company’s Adjusted EBITDA or Adjusted FFO. Pro forma guidance removes income from hotels that were sold. For the full year 2014, the Company anticipates:

		Current Outlook			Prior Outlook
Pro forma RevPAR growth (1)		4.5% to 6.5%			4.0% to 6.0%
Pro forma Hotel EBITDA Margin (1)		34.5% to 35.5%			34.5% to 35.5%
Pro forma Consolidated Hotel EBITDA		$365.0M to $385.0M			$338.0M to $358.0M
Corporate Cash General and Administrative expenses		$25.0M to $26.0M			$25.0M to $26.0M

(1) Excludes non-comparable hotels. Properties closed for renovations are considered non-comparable and therefore are excluded for periods in which they were closed.

Earnings Call

The Company will conduct its quarterly analyst and investor conference call on May 8, 2014, at 11:00 a.m. (Eastern Time). The conference call can be accessed by dialing (877) 407-3982 or (201) 493-6780 for international participants and requesting RLJ Lodging Trust’s first quarter earnings conference call. Additionally, a live webcast of the conference call will be available through the Company’s website at http://rljlodgingtrust.com. A replay of the conference call webcast will be archived and available online through the Investor Relations section of the Company’s website.

About Us

RLJ Lodging Trust is a self-advised, publicly traded real estate investment trust focused on acquiring premium-branded, focused-service and compact full-service hotels. The Company owns 146 properties, comprised of 144 hotels with approximately 22,400 rooms and two planned hotel conversions, located in 21 states and the District of Columbia.

Forward Looking Statements

The following information contains certain statements, other than purely historical information, including estimates, projections, statements relating to the Company’s business plans, objectives and expected operating results, and the assumptions upon which those statements are based, that are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements generally are identified by the use of the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “plan,” “may,” “will,” “will continue,” “intend,” “should,” “may” or similar expressions. Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, beliefs and expectations, such forward-looking statements are not predictions of future events or guarantees of future performance and the Company’s actual results could differ materially from those set forth in the forward-looking statements. Some factors that might cause such a difference include the following: the current global economic uncertainty, increased direct competition, changes in government regulations or accounting rules, changes in local, national and global real estate conditions, declines in the lodging industry, seasonality of the lodging industry, risks related to natural disasters, such as earthquakes and hurricanes, hostilities, including future terrorist attacks or fear of hostilities that affect travel, the Company’s ability to obtain lines of credit or permanent financing on satisfactory terms, changes in interest rates, access to capital through offerings of the Company’s common and preferred shares of beneficial interest, or debt, the Company’s ability to identify suitable acquisitions, the Company’s ability to close on identified acquisitions and integrate those businesses and inaccuracies of the Company’s accounting estimates. Given these uncertainties, undue reliance should not be placed on such statements. Except as required by law, the Company undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise. The Company cautions investors not to place undue reliance on these forward-looking statements and urge investors to carefully review the disclosures the Company makes concerning risks and uncertainties in the sections entitled “Risk Factors,” “Forward-Looking Statements,” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s Annual Report, as well as risks, uncertainties and other factors discussed in other documents filed by the Company with the SEC.

For additional information or to receive press releases via email, please visit our website:
http://rljlodgingtrust.com

RLJ Lodging Trust
Non-GAAP and Accounting Commentary

Non-Generally Accepted Accounting Principles (“GAAP”) Financial Measures

The Company considers the following non-GAAP financial measures useful to investors as key supplemental measures of its performance: (1) FFO, (2) Adjusted FFO, (3) EBITDA, (4) Adjusted EBITDA, and (5) Hotel EBITDA. These non-GAAP financial measures should be considered along with, but not as alternatives to, net income or loss as a measure of its operating performance. FFO, Adjusted FFO, EBITDA, Adjusted EBITDA, and Hotel EBITDA as calculated by the Company, may not be comparable to other companies that do not define such terms exactly as the Company.

Funds From Operations (“FFO”)

The Company calculates FFO in accordance with standards established by the National Association of Real Estate Investment Trusts, or NAREIT, which defines FFO as net income or loss (calculated in accordance with GAAP), excluding gains or losses from sales of real estate, impairment, items classified by GAAP as extraordinary, the cumulative effect of changes in accounting principles, plus depreciation and amortization, and adjustments for unconsolidated partnerships and joint ventures. 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 real estate industry investors consider FFO to be helpful in evaluating a real estate company’s operations. The Company believes that the presentation of FFO provides useful information to investors regarding the Company’s operating performance and can facilitate comparisons of operating performance between periods and between real estate investment trusts (“REITs”), even though FFO does not represent an amount that accrues directly to common shareholders.

The Company’s calculation of FFO may not be comparable to measures calculated by other companies who do not use the NAREIT definition of FFO or do not calculate FFO per diluted share in accordance with NAREIT guidance. Additionally, FFO may not be helpful when comparing the Company to non-REITs. The Company presents FFO attributable to common shareholders, which includes unitholders of limited partnership interest (“OP units”) in RLJ Lodging Trust, L.P., the Company’s operating partnership, because the OP units are redeemable for common shares of the Company. The Company believes it is meaningful for the investor to understand FFO attributable to all common shares and OP units.

Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”)

EBITDA is defined as net income or loss excluding: (1) interest expense; (2) provision for income taxes, including income taxes applicable to sales of assets; and (3) depreciation and amortization. The Company considers EBITDA useful to an investor in evaluating and facilitating comparisons of its operating performance between periods and between REITs by removing the impact of its capital structure (primarily interest expense) and asset base (primarily depreciation and amortization) from its operating results. In addition, EBITDA is used as one measure in determining the value of hotel acquisitions and dispositions. The Company presents EBITDA attributable to common shareholders, which includes OP units, because the OP units are redeemable for common shares of the Company. The Company believes it is meaningful for the investor to understand EBITDA attributable to all common shares and OP units.

Hotel EBITDA

With respect to Hotel EBITDA, the Company believes that excluding the effect of corporate-level expenses and non-cash items provides a more complete understanding of the operating results over which individual hotels and operators have direct control. The Company believes property-level results provide investors with supplemental information about the ongoing operational performance of the Company’s hotels and the effectiveness of third-party management companies operating the Company’s business on a property-level basis.

Pro forma Hotel EBITDA includes hotel results from prior ownership periods and excludes non-comparable hotels which were not open for operation or closed for renovations for comparable periods. Pro forma Consolidated Hotel EBITDA includes hotel results from prior ownership periods and includes the results of non-comparable hotels which were not open for operation or closed for renovations during the comparable periods.

Adjustments to FFO and EBITDA

The Company adjusts FFO and EBITDA for certain additional items, such as discontinued operations, transaction and pursuit costs, the amortization of share-based compensation, and certain other expenses that the Company considers outside the normal course of business. The Company believes that Adjusted FFO and Adjusted EBITDA provide useful supplemental information to investors regarding its ongoing operating performance that, when considered with net income, FFO and EBITDA, is beneficial to an investor’s understanding of its operating performance. The Company adjusts FFO and EBITDA for the following items, as applicable:

• Transaction and Pursuit Costs: The Company excludes transaction and pursuit costs expensed during the period because it believes they do not reflect the underlying performance of the Company.
• Non-Cash Expenses: The Company excludes the effect of certain non-cash items because it believes they do not reflect the underlying performance of the Company. The Company has excluded the amortization of share based compensation, non-cash loss on the disposal of assets, and the accelerated amortization of deferred financing fees.
• Other Non-operational Expenses: The Company excludes the effect of certain non-operational expenses because it believes they do not reflect the underlying performance of the Company. The Company has excluded legal expenses it considered outside the normal course of business and the loss on defeasance of debt.

New Accounting Treatment for Discontinued Operations: The Company adopted Financial Accounting Standards Board Accounting Standards Update (ASU) 2014-08, Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity. Going forward, the Company will only classify dispositions in discontinued operations if they represent a strategic shift in operations (e.g., disposal of a major line of business). The 13 assets sold during the quarter are not considered as a strategic shift in operations.

RLJ Lodging Trust
Consolidated Balance Sheets
(Amounts in thousands, except share and per share data)
		March 31,  2014				December 31, 2013
		(unaudited)
Assets
Investment in hotels and other properties, net		$	3,422,662			$	3,241,163
Cash and cash equivalents		270,765				332,248
Restricted cash reserves		57,193				62,430
Hotel and other receivables, net of allowance of $172 and $234, respectively		31,758				22,762
Deferred financing costs, net		11,977				11,599
Deferred income tax asset		2,636				2,529
Purchase deposits		7,246				7,246
Prepaid expense and other assets		39,428				37,997
Total assets		$	3,843,665			$	3,717,974
Liabilities and Equity
Mortgage loans		$	536,470			$	559,665
Term loans		1,025,000				850,000
Accounts payable and accrued expense		102,518				115,011
Deferred income tax liability		3,467				3,548
Advance deposits and deferred revenue		14,093				9,851
Accrued interest		2,613				2,695
Distributions payable		28,677				30,870
Total liabilities		1,712,838				1,571,640
Equity
Shareholders’ equity:
Preferred shares of beneficial interest, $0.01 par value, 50,000,000 shares authorized; zero shares issued and outstanding at March 31, 2014 and December 31, 2013, respectively.		—				—
Common shares of beneficial interest, $0.01 par value, 450,000,000 shares authorized; 122,901,341 and 122,640,042 shares issued and outstanding at March 31, 2014 and December 31, 2013, respectively.		1,229				1,226
Additional paid-in-capital		2,180,505				2,178,004
Accumulated other comprehensive loss		(7,302		)		(5,941		)
Distributions in excess of net earnings		(60,848		)		(45,522		)
Total shareholders’ equity		2,113,584				2,127,767
Noncontrolling interest
Noncontrolling interest in joint venture		6,090				7,306
Noncontrolling interest in Operating Partnership		11,153				11,261
Total noncontrolling interest		17,243				18,567
Total equity		2,130,827				2,146,334
Total liabilities and equity		$	3,843,665			$	3,717,974

RLJ Lodging Trust
Consolidated Statements of Operations
(Amounts in thousands, except share and per share data)
(Unaudited)
		For the three months ended March 31,
		2014				2013
Revenue
Operating revenue
Room revenue		$	206,025			$	185,448
Food and beverage revenue		23,367				23,212
Other operating department revenue		6,981				6,210
Total revenue		236,373				214,870
Expense
Operating expense
Room expense		47,521				43,097
Food and beverage expense		16,873				16,557
Management fee expense		9,113				7,381
Other operating expense		72,076				66,366
Total property operating expense		145,583				133,401
Depreciation and amortization		32,876				31,344
Property tax, insurance and other		17,252				14,710
General and administrative		10,129				8,798
Transaction and pursuit costs		1,484				1,089
Total operating expense		207,324				189,342
Operating income		29,049				25,528
Other income		110				79
Interest income		323				296
Interest expense		(14,646		)		(16,874		)
Income from continuing operations before income tax expense		14,836				9,029
Income tax expense		(294		)		(226		)
Income from continuing operations		14,542				8,803
Loss from discontinued operations		—				(219		)
Loss on disposal of hotel properties		(2,557		)		—
Net income		11,985				8,584
Net (income) loss attributable to non-controlling interests
Noncontrolling interest in consolidated joint venture		34				48
Noncontrolling interest in common units of Operating Partnership		(87		)		(139		)
Net income attributable to common shareholders		$	11,932			$	8,493
Basic per common share data:
Income from continuing operations attributable to common shareholders, including loss on disposal of hotel properties		$	0.10			$	0.08
Discontinued operations		—				—
Net income per share attributable to common shareholders		$	0.10			$	0.08
Weighted-average number of common shares		121,740,962				106,815,375
Diluted per common share data:
Income from continuing operations attributable to common shareholders, including loss on disposal of hotel properties		$	0.10			$	0.08
Discontinued operations		—				—
Net income per share attributable to common shareholders		$	0.10			$	0.08
Weighted-average number of common shares		122,867,755				107,423,195

Note:

The Statement of Comprehensive Income and corresponding footnotes can be found in the Company’s Quarterly Report on Form 10-Q.

RLJ Lodging Trust
Reconciliation of Net Income to Non-GAAP Measures
(Amounts in thousands, except per share data)
(Unaudited)
Funds From Operations (FFO)
		For the three months ended March 31,
		2014				2013
Net income		$	11,985			$	8,584
Depreciation and amortization		32,876				31,344
Loss on disposal of hotel properties		2,557				—
Noncontrolling interest in joint venture		34				48
Adjustments related to discontinued operations (1)		—				91
Adjustments related to joint venture (2)		(46		)		(121		)
FFO attributable to common shareholders		47,406				39,946
Transaction and pursuit costs		1,484				1,089
Amortization of share based compensation		3,573				3,014
Loan related costs (3)		1,073				—
Other expenses (4)		—				13
Adjusted FFO		$	53,536			$	44,062
Adjusted FFO per common share and unit-basic		$	0.44			$	0.41
Adjusted FFO per common share and unit-diluted		$	0.43			$	0.41
Basic weighted-average common shares and units outstanding (5)		122,635				107,709
Diluted weighted-average common shares and units outstanding (5)		123,762				108,317

Note:
(1)		Includes depreciation and amortization expense from discontinued operations.
(2)		Includes depreciation and amortization expense allocated to the noncontrolling interest in the joint venture.
(3)		Represents primarily a loss on defeasance and accelerated amortization of deferred financing fees.
(4)		Represents legal expenses outside the normal course of operations.
(5)		Includes 0.9 million operating partnership units.

RLJ Lodging Trust
Reconciliation of Net Income to Non-GAAP Measures
(Amounts in thousands)
(Unaudited)
Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA)
		For the three months ended March 31,
		2014				2013
Net income		$	11,985			$	8,584
Depreciation and amortization		32,876				31,344
Interest expense, net (1)		14,638				16,866
Income tax expense		294				226
Noncontrolling interest in joint venture		34				48
Adjustments related to discontinued operations (2)		—				252
Adjustments related to joint venture (3)		(46		)		(121		)
EBITDA		59,781				57,199
Transaction and pursuit costs		1,484				1,089
Loss on disposal of hotel properties		2,557				—
Amortization of share based compensation		3,573				3,014
Other expenses (4)		—				13
Adjusted EBITDA		$	67,395			$	61,315
General and administrative (5)		6,555				5,783
Operating results from noncontrolling interest in joint venture		12				73
Apartment income		49				(43		)
Pro forma adjustments (6)		4,511				10,396
Income from sold properties		(415		)		(2,475		)
Other corporate adjustments		14				67
Pro forma Consolidated Hotel EBITDA		78,121				75,116
Non-comparable hotels (7)		(11		)		(190		)
Pro forma Hotel EBITDA		$	78,110			$	74,926

Note:
(1)		Interest expense is net of interest income, excludes amounts attributable to investment in loans of $0.3 million for both the three months ended March 31, 2014 and 2013.
(2)		Includes depreciation, amortization and interest expense from discontinued operations.
(3)		Includes depreciation, amortization and interest expense allocated to the noncontrolling interest in the joint venture.
(4)		Represents legal expenses outside the normal course of operations.
(5)		General and administrative expenses exclude amortization of share based compensation, which is reflected in Adjusted EBITDA.
(6)		Reflects prior ownership results of recent acquisitions and normalizes ground rent for the Courtyard Waikiki Beach. For the three months ended March 31, 2013, Pro forma Hotel EBITDA for the Courtyard Waikiki Beach was reduced by $0.9 million.
(7)		Reflects the results of Residence Inn Atlanta Midtown Historic, which is currently closed for a comprehensive renovation.

RLJ Lodging Trust
Consolidated Debt Summary
(Amounts in thousands)
(Unaudited)
Loan		Base Term (Years)		Maturity (incl. extensions)		Floating / Fixed		Interest Rate (1)		Balance as of March 31, 2014
Secured Debt
Capmark Financial Group - 1 hotel		10		May 2015		Fixed		5.55%		$	10,816
Capmark Financial Group - 1 hotel		10		June 2015		Fixed		5.55%		4,692
Barclay’s Bank - 12 hotels		10		June 2015		Fixed		5.55%		110,611
Barclay’s Bank - 4 hotels		10		June 2015		Fixed		5.60%		27,534
Capmark Financial Group - 1 hotel		10		July 2015		Fixed		5.50%		6,391
Barclay’s Bank - 1 hotel		10		September 2015		Fixed		5.44%		10,426
Wells Fargo - 5 hotels		3		October 2016		Floating		3.75%		142,000
PNC Bank - 5 hotels		4		May 2017		Floating		2.50%		74,000
Wells Fargo - 4 hotels		3		September 2020		Floating (2)		4.19%		150,000
Secured Total / Weighted Average								4.27%		$	536,470
Unsecured Debt
Credit Facility		4		November 2017		Floating		1.92%		$	—
2013 Five-Year Term Loan		5		August 2018		Floating (2)(3)		3.07%		400,000
2012 Five-Year Term Loan		5		March 2019		Floating (2)(4)		1.70%		400,000
Seven-Year Term Loan		7		November 2019		Floating (2)		4.04%		225,000
Unsecured Total / Weighted Average								2.75%		$	1,025,000
Total Debt / Weighted Average								3.27%		$	1,561,470

Note:
(1)		Interest rates include the effect of interest rate swaps as of March 31, 2014.
(2)		The floating interest rate is hedged with an interest rate swap.
(3)		Reflects interest rate swap on $350.0 million.
(4)		Interest rate does not reflect forward interest rate swap. Forward swap only applicable to $275.0 million.

RLJ Lodging Trust
Acquisitions
										Gross Purchase
										Price			%
2014 Acquisitions		Location		Acquisition Date		Management Company		Rooms		($ in millions) (1)			Interest
Hyatt House Charlotte Center City		Charlotte, NC		March 12, 2014		Hyatt Affiliate		163		$	32.5		100	%
Hyatt House Cypress Anaheim		Cypress, CA		March 12, 2014		Hyatt Affiliate		142			14.8		100	%
Hyatt House Emeryville SF Bay Area		Emeryville, CA		March 12, 2014		Hyatt Affiliate		234			39.3		100	%
Hyatt House San Diego Sorrento Mesa		San Diego, CA		March 12, 2014		Hyatt Affiliate		193			36.0		100	%
Hyatt House San Jose Silicon Valley		San Jose, CA		March 12, 2014		Hyatt Affiliate		164			44.2		100	%
Hyatt House San Ramon		San Ramon, CA		March 12, 2014		Hyatt Affiliate		142			20.8		100	%
Hyatt House Santa Clara		Santa Clara, CA		March 12, 2014		Hyatt Affiliate		150			40.6		100	%
Hyatt Market Street The Woodlands		The Woodlands, TX		March 12, 2014		Hyatt Affiliate		70			25.8		100	%
Hyatt Place Fremont Silicon Valley		Fremont, CA		March 12, 2014		Hyatt Affiliate		151			23.5		100	%
Hyatt Place Madison Downtown		Madison, WI		March 12, 2014		Hyatt Affiliate		151			35.1		100	%
Total Acquisitions								1,560		$	312.5
Hilton Cabana Miami Beach (2)		Miami Beach, FL		N/A		N/A		231			71.6		100	%
Total Acquisitions (including Hilton Cabana)								1,791		$	384.1
										Gross Purchase
										Price			%
2013 Acquisitions		Location		Acquisition Date		Management Company		Rooms		($ in millions) (1)			Interest
Courtyard Houston Downtown Convention Center		Houston, TX		March 19, 2013		White Lodging Services		191		$	34.4		100	%
Residence Inn Houston Downtown Convention Center		Houston, TX		March 19, 2013		White Lodging Services		171			29.5		100	%
Humble Tower Apartments (3)		Houston, TX		March 19, 2013		N/A		82			15.6		100	%
Courtyard Waikiki Beach		Honolulu, HI		June 17, 2013		Highgate Hotels		399			75.3		100	%
Vantaggio Suites Cosmo / Courtyard San Francisco (4)		San Francisco, CA		June 21, 2013		N/A		150			29.5		100	%
Residence Inn Atlanta Midtown Historic (5)		Atlanta, GA		August 6, 2013		N/A		78			5.0		100	%
SpringHill Suites Portland Hillsboro		Hillsboro, OR		October 8, 2013		InnVentures		106			24.0		100	%
Total Acquisitions								1,177		$	213.3

Note:
(1)		Gross purchase price does not include net closing adjustments. Please refer to the 10-Q for the net purchase price.
(2)		On November 30, 2012, the Company signed a purchase and sale agreement to acquire upon completion the 231-room Hilton Cabana Miami Beach for a fixed purchase price of $71.6 million, or approximately $310,000 per key.
(3)		This property is currently not open for operations. Conversion to a SpringHill Suites is in progress.
(4)		This property is currently not open for operations. Conversion to a Courtyard by Marriott is in progress.
(5)		The Company was the successful bidder at a foreclosure sale of the property collateralizing the non-performing loan. The purchase price equates to the original amount paid for the mortgage note in November 2009. The property is closed and undergoing a major renovation.

RLJ Lodging Trust
Pro forma Operating Statistics — Top 50 Assets
(Amounts in thousands, except rooms)
(Unaudited)
For the trailing twelve months ended March 31, 2014
						Pro forma Consolidated
Property		City/State		Rooms		Hotel EBITDA
DoubleTree NYC Metropolitan		New York, NY		764		$	19,717
Marriott Louisville Downtown		Louisville, KY		616			14,055
Hilton New York Fashion District		New York, NY		280			11,085
Hilton Garden Inn New York W 35th St		New York, NY		298			10,633
Courtyard Austin Dtwn Conv Ctr		Austin, TX		270			9,134
Courtyard Chicago Downtown Mag Mile		Chicago, IL		306			6,891
Fairfield Inn & Suites DC Downtown		Washington, DC		198			5,814
Embassy Suites Tampa Dtwn Conv Ctr		Tampa, FL		360			5,725
Renaissance Pittsburgh Hotel		Pittsburgh, PA		300			5,644
Courtyard Waikiki Beach (1)		Honolulu - Oahu, HI		403			5,586
Embassy Suites Boston Waltham		Waltham, MA		275			5,109
Courtyard New York Manhattan Upper East		New York, NY		226			4,946
Residence Inn Austin Dtwn Conv Ctr		Austin, TX		179			4,919
Marriott Denver Airport @ Gateway Park		Aurora, CO		238			4,700
Marriott Denver South @ Park Meadows		Lone Tree, CO		279			4,654
Hilton Garden Inn SF Oakland Bay Bridge		Emeryville, CA		278			4,633
Hilton Garden Inn Los Angeles Hollywood		Los Angeles, CA		160			4,410
Residence Inn Bethesda Downtown		Bethesda, MD		187			4,409
Courtyard Houston By The Galleria		Houston, TX		190			4,407
Homewood Suites Washington DC Downtown		Washington, DC		175			4,312
Courtyard Charleston Historic District		Charleston, SC		176			4,243
Hilton Garden Inn New Orleans Conv Ctr		New Orleans, LA		286			4,072
Residence Inn National Harbor DC		Oxon Hill, MD		162			3,931
Hyatt House Emeryville SF Bay Area		Emeryville, CA		234			3,916
Hyatt House Santa Clara		Santa Clara, CA		150			3,829
Embassy Suites Los Angeles Downey		Downey, CA		219			3,826
Hyatt House San Jose Silicon Valley		San Jose, CA		164			3,708
Renaissance Boulder Flatiron Hotel		Broomfield, CO		232			3,392
Renaissance Ft Lauderdale Plantation		Plantation, FL		250			3,317
Marriott Austin South		Austin, TX		211			3,312
Courtyard Houston Dtwn Conv Ctr		Houston, TX		191			3,287
Residence Inn Chicago Oak Brook		Oak Brook, IL		156			3,282
Hilton Garden Inn Bloomington		Bloomington, IN		168			2,958
Residence Inn Houston Dtwn Conv Ctr		Houston, TX		171			2,948
Hyatt House Charlotte Center City		Charlotte, NC		163			2,917
Residence Inn Houston By The Galleria		Houston, TX		146			2,879
Hampton Inn Houston Near The Galleria		Houston, TX		176			2,874
Hampton Inn Garden City		Garden City, NY		143			2,816
Hyatt Place Madison Downtown		Madison, WI		151			2,809
Residence Inn Louisville Downtown		Louisville, KY		140			2,698
Hilton Garden Inn Pittsburgh Univ Pl		Pittsburgh, PA		202			2,661
Marriott Chicago Midway		Chicago, IL		200			2,613
Hyatt House Dallas Lincoln Park		Dallas, TX		155			2,553
Hyatt House San Diego Sorrento Mesa		San Diego, CA		193			2,464
SpringHill Suites Portland Hillsboro		Hillsboro, OR		106			2,435
Residence Inn Indy Dtwn On The Canal		Indianapolis, IN		134			2,429
Courtyard Austin Airport		Austin, TX		150			2,386
Hyatt Place Fremont Silicon Valley		Fremont, CA		151			2,346
Hyatt Market Street The Woodlands		The Woodlands, TX		70			2,144
Hyatt House Houston Galleria		Houston, TX		147			1,876
Top 50 Assets				11,179			231,704
Other (2)				11,172			125,658
Total Portfolio				22,351		$	357,362

Note:
The information above has not been audited and is presented only for comparison purposes. Results reflect 100% of DoubleTree NYC Metropolitan financial results, which have not been adjusted to reflect the 1.9% noncontrolling interest in the joint venture.
(1)		The trailing twelve months for the Courtyard Waikiki Beach has been reduced by $0.7 million to normalize ground lease payments for periods prior to the Company’s ownership. The Company entered into a ground lease upon acquisition, with an annual ground rent amount of $3.5 million through 2016 and subject to CPI increases thereafter.
(2)		Reflects 94 hotels. Disposed hotels and two planned hotel conversions which are underway are not included.

RLJ Lodging Trust
Pro forma Operating Statistics
(Unaudited)
For the three months ended March 31, 2014
																																% of Hotel
Top Markets				Occupancy										ADR									RevPAR									EBITDA
		# of Hotels		2014			2013			Var				2014			2013			Var			2014			2013			Var			Q1
NYC		5		93.3	%		95.2	%		(2.0	)%			$	179.27		$	186.49		(3.9	)%		$	167.18		$	177.51		(5.8	)%		5	%
Chicago		21		63.9	%		61.7	%		3.6	%			113.72			114.48			(0.7	)%		72.67			70.62			2.9	%		5	%
Austin		15		79.4	%		77.1	%		3.1	%			161.33			153.22			5.3	%		128.18			118.07			8.6	%		15	%
Denver		13		69.7	%		63.6	%		9.5	%			122.92			118.84			3.4	%		85.68			75.62			13.3	%		7	%
Houston		9		73.3	%		77.5	%		(5.4	)%			161.41			151.89			6.3	%		118.35			117.73			0.5	%		8	%
Washington, D.C.		7		68.4	%		62.1	%		10.2	%			164.89			166.69			(1.1	)%		112.79			103.46			9.0	%		6	%
Other		73		74.2	%		72.2	%		2.6	%			140.48			132.57			6.0	%		104.17			95.78			8.8	%		54	%
Total		143		74.1	%		72.2	%		2.7	%			$	144.34		$	139.80		3.3	%		$	107.00		$	100.95		6.0	%		100	%
																																% of Hotel
Service Level				Occupancy										ADR									RevPAR									EBITDA
		# of Hotels		2014			2013			Var				2014			2013			Var			2014			2013			Var			Q1
Focused-Service		122		73.4	%		71.1	%		3.3	%			$	138.91		$	134.37		3.4	%		$	101.96		$	95.47		6.8	%		75	%
Compact Full-Service		20		77.7	%		76.8	%		1.2	%			159.40			154.66			3.1	%		123.89			118.79			4.3	%		21	%
Full Service		1		64.6	%		66.0	%		(2.0	)%			163.11			156.76			4.1	%		105.40			103.40			1.9	%		4	%
Total		143		74.1	%		72.2	%		2.7	%			$	144.34		$	139.80		3.3	%		$	107.00		$	100.95		6.0	%		100	%
																																% of Hotel
Chain Scale				Occupancy										ADR									RevPAR									EBITDA
		# of Hotels		2014			2013			Var				2014			2013			Var			2014			2013			Var			Q1
Upper Upscale Chains		17		74.2	%		73.8	%		0.6	%			$	160.99		$	152.54		5.5	%		$	119.43		$	112.54		6.1	%		23	%
Upscale Chains		102		74.7	%		72.7	%		2.8	%			142.72			139.05			2.6	%		106.67			101.10			5.5	%		65	%
Upper Midscale Chains		23		70.7	%		66.8	%		5.7	%			129.50			125.67			3.0	%		91.50			83.99			8.9	%		12	%
Midscale Chains		1		75.3	%		75.3	%		(0.1	)%			64.95			60.43			7.5	%		48.89			45.53			7.4	%		0	%
Total		143		74.1	%		72.2	%		2.7	%			$	144.34		$	139.80		3.3	%		$	107.00		$	100.95		6.0	%		100	%
																																% of Hotel
Flags				Occupancy										ADR									RevPAR									EBITDA
		# of Hotels		2014			2013			Var				2014			2013			Var			2014			2013			Var			Q1
Residence Inn		33		75.8	%		71.7	%		5.7	%			$	134.21		$	130.23		3.0	%		$	101.76		$	93.44		8.9	%		19	%
Courtyard		32		70.9	%		69.9	%		1.5	%			142.10			138.31			2.7	%		100.77			96.64			4.3	%		20	%
Hyatt House		11		77.0	%		78.5	%		(2.0	)%			145.47			133.23			9.2	%		111.97			104.64			7.0	%		9	%
Fairfield Inn & Suites		11		69.0	%		66.4	%		3.9	%			132.16			128.62			2.8	%		91.17			85.38			6.8	%		5	%
SpringHill Suites		10		70.5	%		65.3	%		7.9	%			112.47			111.08			1.2	%		79.27			72.55			9.3	%		5	%
Hilton Garden Inn		9		75.9	%		73.7	%		3.0	%			157.03			155.16			1.2	%		119.21			114.35			4.2	%		8	%
Hampton Inn		8		76.0	%		70.0	%		8.6	%			134.27			128.60			4.4	%		102.06			90.01			13.4	%		5	%
Marriott		6		68.6	%		66.3	%		3.4	%			147.66			140.93			4.8	%		101.27			93.46			8.4	%		9	%
Embassy Suites		6		79.5	%		78.1	%		1.7	%			162.56			151.82			7.1	%		129.17			118.62			8.9	%		8	%
Renaissance		3		68.6	%		73.5	%		(6.7	)%			158.16			142.59			10.9	%		108.44			104.83			3.4	%		3	%
Homewood Suites		2		71.1	%		75.0	%		(5.2	)%			166.87			161.27			3.5	%		118.68			120.98			(1.9	)%		2	%
Hyatt Place		2		78.6	%		81.7	%		(3.8	)%			129.66			115.46			12.3	%		101.90			94.30			8.1	%		1	%
DoubleTree		2		90.8	%		88.1	%		3.0	%			168.92			177.27			(4.7	)%		153.34			156.22			(1.8	)%		1	%
Hilton		1		98.6	%		99.8	%		(1.3	)%			196.37			203.20			(3.4	)%		193.56			202.89			(4.6	)%		2	%
Hyatt		1		79.6	%		79.6	%		0	%			281.88			269.03			4.8	%		224.30			214.07			4.8	%		1	%
Other		6		65.8	%		61.5	%		7.0	%			119.20			117.01			1.9	%		78.41			71.94			9.0	%		2	%
Total		143		74.1	%		72.2	%		2.7	%			$	144.34		$	139.80		3.3	%		$	107.00		$	100.95		6.0	%		100	%

Note:

The information above includes results for periods prior to the Company's ownership. The information has not been audited and is presented only for comparison purposes. Results reflect 100% of DoubleTree NYC Metropolitan financial results, which have not been adjusted to reflect the 1.9% noncontrolling interest in the joint venture. All results exclude disposed hotels, two planned hotel conversions, and one non-comparable hotel, the Residence Inn Atlanta Midtown Historic, which is currently closed and undergoing a comprehensive renovation.