FELCOR LODGING TRUST INCORPORATED
CONSOLIDATED STATEMENTS OF OPERATIONS
For the
Three and Nine
Months Ended
September 30, 2012
and
2011
(unaudited, in thousands, except for per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
Revenues:
|
|
|
|
|
|
|
|
Hotel operating revenue
|
$
|
234,796
|
|
|
$
|
221,634
|
|
|
$
|
692,313
|
|
|
$
|
650,068
|
|
Other revenue
|
1,441
|
|
|
1,394
|
|
|
2,672
|
|
|
2,630
|
|
Total revenues
|
236,237
|
|
|
223,028
|
|
|
694,985
|
|
|
652,698
|
|
Expenses:
|
|
|
|
|
|
|
|
Hotel departmental expenses
|
84,563
|
|
|
80,676
|
|
|
250,749
|
|
|
236,004
|
|
Other property-related costs
|
63,940
|
|
|
61,944
|
|
|
188,428
|
|
|
179,399
|
|
Management and franchise fees
|
10,895
|
|
|
10,245
|
|
|
32,188
|
|
|
30,033
|
|
Taxes, insurance and lease expense
|
25,353
|
|
|
23,015
|
|
|
71,983
|
|
|
64,231
|
|
Corporate expenses
|
5,695
|
|
|
6,258
|
|
|
20,074
|
|
|
22,705
|
|
Depreciation and amortization
|
31,749
|
|
|
29,891
|
|
|
92,544
|
|
|
88,960
|
|
Impairment loss
|
—
|
|
|
—
|
|
|
1,335
|
|
|
7,003
|
|
Other expenses
|
2,163
|
|
|
1,208
|
|
|
3,926
|
|
|
3,455
|
|
Total operating expenses
|
224,358
|
|
|
213,237
|
|
|
661,227
|
|
|
631,790
|
|
Operating income
|
11,879
|
|
|
9,791
|
|
|
33,758
|
|
|
20,908
|
|
Interest expense, net
|
(31,359
|
)
|
|
(32,865
|
)
|
|
(93,547
|
)
|
|
(98,172
|
)
|
Debt extinguishment
|
(11,661
|
)
|
|
(21
|
)
|
|
(11,808
|
)
|
|
(27,599
|
)
|
Gain on involuntary conversion, net
|
—
|
|
|
109
|
|
|
—
|
|
|
292
|
|
Loss before equity in income (loss) from unconsolidated entities
|
(31,141
|
)
|
|
(22,986
|
)
|
|
(71,597
|
)
|
|
(104,571
|
)
|
Equity in income (loss) from unconsolidated entities
|
1,536
|
|
|
249
|
|
|
2,674
|
|
|
(1,303
|
)
|
Loss from continuing operations
|
(29,605
|
)
|
|
(22,737
|
)
|
|
(68,923
|
)
|
|
(105,874
|
)
|
Income (loss) from discontinued operations
|
10,050
|
|
|
(639
|
)
|
|
32,535
|
|
|
8,375
|
|
Net loss
|
(19,555
|
)
|
|
(23,376
|
)
|
|
(36,388
|
)
|
|
(97,499
|
)
|
Net loss attributable to noncontrolling interests in other partnerships
|
386
|
|
|
378
|
|
|
440
|
|
|
269
|
|
Net loss attributable to redeemable noncontrolling interests in FelCor LP
|
144
|
|
|
166
|
|
|
329
|
|
|
469
|
|
Net loss attributable to FelCor
|
(19,025
|
)
|
|
(22,832
|
)
|
|
(35,619
|
)
|
|
(96,761
|
)
|
Preferred dividends
|
(9,678
|
)
|
|
(9,678
|
)
|
|
(29,034
|
)
|
|
(29,034
|
)
|
Net loss attributable to FelCor common stockholders
|
$
|
(28,703
|
)
|
|
$
|
(32,510
|
)
|
|
$
|
(64,653
|
)
|
|
$
|
(125,795
|
)
|
Basic and diluted per common share data:
|
|
|
|
|
|
|
|
Loss from continuing operations
|
$
|
(0.31
|
)
|
|
$
|
(0.26
|
)
|
|
$
|
(0.78
|
)
|
|
$
|
(1.18
|
)
|
Net loss
|
$
|
(0.23
|
)
|
|
$
|
(0.26
|
)
|
|
$
|
(0.52
|
)
|
|
$
|
(1.10
|
)
|
Basic and diluted weighted average common shares outstanding
|
123,640
|
|
|
123,062
|
|
|
123,648
|
|
|
113,908
|
|
The accompanying notes are an integral part of these consolidated financial statements.
FELCOR LODGING TRUST INCORPORATED
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
For the
Three and Nine
Months Ended
September 30, 2012
and
2011
(unaudited, in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
September 30,
|
|
September 30,
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
Net loss
|
$
|
(19,555
|
)
|
|
$
|
(23,376
|
)
|
|
$
|
(36,388
|
)
|
|
$
|
(97,499
|
)
|
Foreign currency translation adjustment
|
502
|
|
|
(3,535
|
)
|
|
493
|
|
|
(2,057
|
)
|
Comprehensive loss
|
(19,053
|
)
|
|
(26,911
|
)
|
|
(35,895
|
)
|
|
(99,556
|
)
|
Comprehensive loss attributable to noncontrolling interests in other partnerships
|
386
|
|
|
378
|
|
|
440
|
|
|
269
|
|
Comprehensive loss attributable to redeemable noncontrolling interests in FelCor LP
|
141
|
|
|
184
|
|
|
326
|
|
|
483
|
|
Comprehensive loss attributable to FelCor
|
$
|
(18,526
|
)
|
|
$
|
(26,349
|
)
|
|
$
|
(35,129
|
)
|
|
$
|
(98,804
|
)
|
The accompanying notes are an integral part of these consolidated financial statements.
FELCOR LODGING TRUST INCORPORATED
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
For the
Nine
Months Ended
September 30, 2012
and
2011
(unaudited, in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred Stock
|
|
Common Stock
|
|
Additional Paid-in Capital
|
|
Accumulated Other Comprehensive Income
|
|
|
|
|
|
Noncontrolling Interests in Other Partnerships
|
|
|
|
|
|
Number of Shares
|
|
Amount
|
|
Number of Shares
|
|
Amount
|
|
|
|
Accumulated Deficit
|
|
Treasury Stock
|
|
|
Comprehensive Loss
|
|
Total Equity
|
Balance at December 31, 2010
|
12,948
|
|
|
$
|
478,774
|
|
|
101,038
|
|
|
$
|
1,010
|
|
|
$
|
2,190,308
|
|
|
$
|
26,457
|
|
|
$
|
(2,054,625
|
)
|
|
$
|
(73,341
|
)
|
|
$
|
19,795
|
|
|
|
|
|
$
|
588,378
|
|
Issuance of common stock
|
—
|
|
|
—
|
|
|
27,600
|
|
|
276
|
|
|
158,200
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
158,476
|
|
Retirement of treasury stock
|
—
|
|
|
—
|
|
|
(4,156
|
)
|
|
(41
|
)
|
|
—
|
|
|
—
|
|
|
(73,300
|
)
|
|
73,341
|
|
|
—
|
|
|
|
|
—
|
|
Issuance of stock awards
|
—
|
|
|
—
|
|
|
95
|
|
|
1
|
|
|
554
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
|
555
|
|
Amortization of stock awards
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,407
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
|
2,407
|
|
Forfeiture of stock awards
|
—
|
|
|
—
|
|
|
(12
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(86
|
)
|
|
—
|
|
|
—
|
|
|
|
|
|
(86
|
)
|
Conversion of operating partnership units into common shares
|
—
|
|
|
—
|
|
|
15
|
|
|
—
|
|
|
97
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
97
|
|
Allocation to redeemable noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
970
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
|
970
|
|
Contribution from noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,646
|
|
|
|
|
|
6,646
|
|
Distribution to noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(868
|
)
|
|
|
|
|
(868
|
)
|
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(68
|
)
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
|
|
|
(70
|
)
|
Preferred dividends:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$1.4625 per Series A preferred share
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(18,837
|
)
|
|
—
|
|
|
—
|
|
|
|
|
|
(18,837
|
)
|
$1.50 per Series C depositary preferred share
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,197
|
)
|
|
—
|
|
|
—
|
|
|
|
|
|
(10,197
|
)
|
Comprehensive loss:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign exchange translation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,043
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
(2,043
|
)
|
|
|
|
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(96,761
|
)
|
|
—
|
|
|
(269
|
)
|
|
(97,030
|
)
|
|
|
|
Comprehensive loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(99,073
|
)
|
|
(99,073
|
)
|
Balance at September 30, 2011
|
12,948
|
|
|
$
|
478,774
|
|
|
124,580
|
|
|
$
|
1,246
|
|
|
$
|
2,352,468
|
|
|
$
|
24,414
|
|
|
$
|
(2,253,808
|
)
|
|
$
|
—
|
|
|
$
|
25,304
|
|
|
|
|
|
$
|
628,398
|
|
Balance at December 31, 2011
|
12,948
|
|
|
$
|
478,774
|
|
|
124,281
|
|
|
$
|
1,243
|
|
|
$
|
2,353,251
|
|
|
$
|
25,738
|
|
|
$
|
(2,297,468
|
)
|
|
$
|
—
|
|
|
$
|
25,357
|
|
|
|
|
|
$
|
586,895
|
|
Amortization of stock awards
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
630
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
|
630
|
|
Forfeiture of stock awards
|
—
|
|
|
—
|
|
|
(63
|
)
|
|
(1
|
)
|
|
193
|
|
|
—
|
|
|
(199
|
)
|
|
—
|
|
|
—
|
|
|
|
|
|
(7
|
)
|
Conversion of operating partnership units into common shares
|
—
|
|
|
—
|
|
|
11
|
|
|
—
|
|
|
45
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
45
|
|
Allocation to redeemable noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(581
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
|
(581
|
)
|
Contribution from noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,756
|
|
|
|
|
|
2,756
|
|
Distribution to noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(931
|
)
|
|
|
|
|
(931
|
)
|
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
|
|
|
(4
|
)
|
Preferred dividends:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$1.4625 per Series A preferred share
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(18,837
|
)
|
|
—
|
|
|
—
|
|
|
|
|
|
(18,837
|
)
|
$1.50 per Series C depositary preferred share
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,197
|
)
|
|
—
|
|
|
—
|
|
|
|
|
|
(10,197
|
)
|
Comprehensive loss:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign exchange translation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
490
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
490
|
|
|
|
|
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(35,619
|
)
|
|
—
|
|
|
(440
|
)
|
|
(36,059
|
)
|
|
|
|
Comprehensive loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(35,569
|
)
|
|
(35,569
|
)
|
Balance at September 30, 2012
|
12,948
|
|
|
$
|
478,774
|
|
|
124,229
|
|
|
$
|
1,242
|
|
|
$
|
2,353,538
|
|
|
$
|
26,228
|
|
|
$
|
(2,362,324
|
)
|
|
$
|
—
|
|
|
$
|
26,742
|
|
|
|
|
$
|
524,200
|
|
The accompanying notes are an integral part of these consolidated financial statements.
FELCOR LODGING TRUST INCORPORATED
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the
Nine
Months Ended
September 30, 2012
and
2011
(unaudited, in thousands)
|
|
|
|
|
|
|
|
|
|
Nine Months Ended September 30,
|
|
2012
|
|
2011
|
Cash flows from operating activities:
|
|
|
|
Net loss
|
$
|
(36,388
|
)
|
|
$
|
(97,499
|
)
|
Adjustments to reconcile net loss to net cash provided by operating activities:
|
|
|
|
Depreciation and amortization
|
97,477
|
|
|
105,058
|
|
Gain on sale of hotels, net
|
(26,641
|
)
|
|
(7,362
|
)
|
Gain on involuntary conversion, net
|
—
|
|
|
(280
|
)
|
Amortization of deferred financing fees and debt discount
|
13,646
|
|
|
13,390
|
|
Amortization of unearned officers’ and directors’ compensation
|
3,748
|
|
|
5,343
|
|
Equity in loss (income) from unconsolidated entities
|
(2,674
|
)
|
|
1,303
|
|
Distributions of income from unconsolidated entities
|
3,431
|
|
|
1,534
|
|
Debt extinguishment, net
|
12,598
|
|
|
24,316
|
|
Impairment loss
|
1,335
|
|
|
13,250
|
|
Changes in assets and liabilities:
|
|
|
|
Accounts receivable
|
(7,649
|
)
|
|
(6,998
|
)
|
Restricted cash - operations
|
—
|
|
|
2,663
|
|
Other assets
|
(6,194
|
)
|
|
(9,843
|
)
|
Accrued expenses and other liabilities
|
20,118
|
|
|
(8,444
|
)
|
Net cash flow provided by operating activities
|
72,807
|
|
|
36,431
|
|
Cash flows from investing activities:
|
|
|
|
Acquisition of hotels
|
—
|
|
|
(137,985
|
)
|
Improvements and additions to hotels
|
(99,985
|
)
|
|
(57,470
|
)
|
Hotel development
|
(16,707
|
)
|
|
—
|
|
Additions to condominium project
|
—
|
|
|
(359
|
)
|
Proceeds from asset dispositions
|
124,610
|
|
|
96,435
|
|
Change in restricted cash – investing
|
2,598
|
|
|
(116,258
|
)
|
Insurance proceeds
|
—
|
|
|
391
|
|
Distributions from unconsolidated entities
|
11,894
|
|
|
1,386
|
|
Net cash flow provided by (used in) investing activities
|
22,410
|
|
|
(213,860
|
)
|
Cash flows from financing activities:
|
|
|
|
Proceeds from borrowings
|
378,750
|
|
|
1,087,285
|
|
Repayment of borrowings
|
(395,355
|
)
|
|
(1,112,414
|
)
|
Payment of deferred financing fees
|
(3,167
|
)
|
|
(18,797
|
)
|
Distributions paid to noncontrolling interests
|
(931
|
)
|
|
(868
|
)
|
Contributions from noncontrolling interests
|
2,756
|
|
|
6,646
|
|
Distributions paid to preferred stockholders
|
(59,021
|
)
|
|
(29,035
|
)
|
Net proceeds from common stock issuance
|
—
|
|
|
158,476
|
|
Proceeds from FelCor LP unit issuance
|
—
|
|
|
2,500
|
|
Net cash flow provided by (used in) financing activities
|
(76,968
|
)
|
|
93,793
|
|
Effect of exchange rate changes on cash
|
112
|
|
|
(153
|
)
|
Net change in cash and cash equivalents
|
18,361
|
|
|
(83,789
|
)
|
Cash and cash equivalents at beginning of periods
|
93,758
|
|
|
200,972
|
|
Cash and cash equivalents at end of periods
|
$
|
112,119
|
|
|
$
|
117,183
|
|
|
|
|
|
Supplemental cash flow information – interest paid, net of capitalized interest
|
$
|
61,700
|
|
|
$
|
92,518
|
|
The accompanying notes are an integral part of these consolidated financial statements.
FELCOR LODGING LIMITED PARTNERSHIP
CONSOLIDATED BALANCE SHEETS
(unaudited, in thousands)
|
|
|
|
|
|
|
|
|
|
September 30,
|
|
December 31,
|
|
2012
|
|
2011
|
Assets
|
|
|
|
Investment in hotels, net of accumulated depreciation of $931,508 and $987,895 at September 30, 2012 and December 31, 2011, respectively
|
$
|
1,813,845
|
|
|
$
|
1,953,795
|
|
Hotel development
|
138,749
|
|
|
120,163
|
|
Investment in unconsolidated entities
|
57,352
|
|
|
70,002
|
|
Hotels held for sale
|
40,822
|
|
|
—
|
|
Cash and cash equivalents
|
112,119
|
|
|
93,758
|
|
Restricted cash
|
81,642
|
|
|
84,240
|
|
Accounts receivable, net of allowance for doubtful accounts of $419 and $333 at September 30, 2012 and December 31, 2011, respectively
|
34,722
|
|
|
27,135
|
|
Deferred expenses, net of accumulated amortization of $14,262 and $13,119 at September 30, 2012 and December 31, 2011, respectively
|
25,362
|
|
|
29,772
|
|
Other assets
|
27,040
|
|
|
24,363
|
|
Total assets
|
$
|
2,331,653
|
|
|
$
|
2,403,228
|
|
Liabilities and Partners’ Capital
|
|
|
|
Debt, net of discount of $24,406 and $32,069 at September 30, 2012 and December 31, 2011, respectively
|
$
|
1,598,094
|
|
|
$
|
1,596,466
|
|
Distributions payable
|
46,306
|
|
|
76,293
|
|
Accrued expenses and other liabilities
|
159,817
|
|
|
140,548
|
|
Total liabilities
|
1,804,217
|
|
|
1,813,307
|
|
Commitments and contingencies
|
|
|
|
|
|
Redeemable units, 625 and 636 units issued and outstanding at September
30, 2012 and December 31, 2011, respectively
|
3,236
|
|
|
3,026
|
|
Capital:
|
|
|
|
Preferred units:
|
|
|
|
Series A Cumulative Convertible Preferred Units, 12,880 units issued and outstanding at September 30, 2012 and December 31, 2011
|
309,362
|
|
|
309,362
|
|
Series C Cumulative Redeemable Preferred Units, 68 units issued and outstanding at September 30, 2012 and December 31, 2011
|
169,412
|
|
|
169,412
|
|
Common units, 124,229 and 124,281 units issued and outstanding at September 30, 2012 and December 31, 2011, respectively
|
(7,657
|
)
|
|
56,916
|
|
Accumulated other comprehensive income
|
26,341
|
|
|
25,848
|
|
Total FelCor LP partners’ capital
|
497,458
|
|
|
561,538
|
|
Noncontrolling interests
|
26,742
|
|
|
25,357
|
|
Total partners’ capital
|
524,200
|
|
|
586,895
|
|
Total liabilities and partners’ capital
|
$
|
2,331,653
|
|
|
$
|
2,403,228
|
|
The accompanying notes are an integral part of these consolidated financial statements.
FELCOR LODGING LIMITED PARTNERSHIP
CONSOLIDATED STATEMENTS OF OPERATIONS
For the
Three and Nine
Months Ended
September 30, 2012
and
2011
(unaudited, in thousands, except for per unit data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
September 30,
|
|
September 30,
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
Revenues:
|
|
|
|
|
|
|
|
Hotel operating revenue
|
$
|
234,796
|
|
|
$
|
221,634
|
|
|
$
|
692,313
|
|
|
$
|
650,068
|
|
Other revenue
|
1,441
|
|
|
1,394
|
|
|
2,672
|
|
|
2,630
|
|
Total revenues
|
236,237
|
|
|
223,028
|
|
|
694,985
|
|
|
652,698
|
|
Expenses:
|
|
|
|
|
|
|
|
Hotel departmental expenses
|
84,563
|
|
|
80,676
|
|
|
250,749
|
|
|
236,004
|
|
Other property-related costs
|
63,940
|
|
|
61,944
|
|
|
188,428
|
|
|
179,399
|
|
Management and franchise fees
|
10,895
|
|
|
10,245
|
|
|
32,188
|
|
|
30,033
|
|
Taxes, insurance and lease expense
|
25,353
|
|
|
23,015
|
|
|
71,983
|
|
|
64,231
|
|
Corporate expenses
|
5,695
|
|
|
6,258
|
|
|
20,074
|
|
|
22,705
|
|
Depreciation and amortization
|
31,749
|
|
|
29,891
|
|
|
92,544
|
|
|
88,960
|
|
Impairment loss
|
—
|
|
|
—
|
|
|
1,335
|
|
|
7,003
|
|
Other expenses
|
2,163
|
|
|
1,208
|
|
|
3,926
|
|
|
3,455
|
|
Total operating expenses
|
224,358
|
|
|
213,237
|
|
|
661,227
|
|
|
631,790
|
|
Operating income
|
11,879
|
|
|
9,791
|
|
|
33,758
|
|
|
20,908
|
|
Interest expense, net
|
(31,359
|
)
|
|
(32,865
|
)
|
|
(93,547
|
)
|
|
(98,172
|
)
|
Debt extinguishment
|
(11,661
|
)
|
|
(21
|
)
|
|
(11,808
|
)
|
|
(27,599
|
)
|
Gain on involuntary conversion, net
|
—
|
|
|
109
|
|
|
—
|
|
|
292
|
|
Loss before equity in income (loss) from unconsolidated entities
|
(31,141
|
)
|
|
(22,986
|
)
|
|
(71,597
|
)
|
|
(104,571
|
)
|
Equity in income (loss) from unconsolidated entities
|
1,536
|
|
|
249
|
|
|
2,674
|
|
|
(1,303
|
)
|
Loss from continuing operations
|
(29,605
|
)
|
|
(22,737
|
)
|
|
(68,923
|
)
|
|
(105,874
|
)
|
Income (loss) from discontinued operations
|
10,050
|
|
|
(639
|
)
|
|
32,535
|
|
|
8,375
|
|
Net loss
|
(19,555
|
)
|
|
(23,376
|
)
|
|
(36,388
|
)
|
|
(97,499
|
)
|
Net loss attributable to noncontrolling interests
|
386
|
|
|
378
|
|
|
440
|
|
|
269
|
|
Net loss attributable to FelCor LP
|
(19,169
|
)
|
|
(22,998
|
)
|
|
(35,948
|
)
|
|
(97,230
|
)
|
Preferred distributions
|
(9,678
|
)
|
|
(9,678
|
)
|
|
(29,034
|
)
|
|
(29,034
|
)
|
Net loss attributable to FelCor LP common unitholders
|
$
|
(28,847
|
)
|
|
$
|
(32,676
|
)
|
|
$
|
(64,982
|
)
|
|
$
|
(126,264
|
)
|
Basic and diluted per common unit data:
|
|
|
|
|
|
|
|
Loss from continuing operations
|
$
|
(0.31
|
)
|
|
$
|
(0.26
|
)
|
|
$
|
(0.78
|
)
|
|
$
|
(1.18
|
)
|
Net loss
|
$
|
(0.23
|
)
|
|
$
|
(0.26
|
)
|
|
$
|
(0.52
|
)
|
|
$
|
(1.10
|
)
|
Basic and diluted weighted average common units outstanding
|
124,266
|
|
|
123,700
|
|
|
124,278
|
|
|
114,361
|
|
The accompanying notes are an integral part of these consolidated financial statements.
FELCOR LODGING LIMITED PARTNERSHIP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
For the
Three and Nine
Months Ended
September 30, 2012
and
2011
(unaudited, in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
September 30,
|
|
September 30,
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
Net loss
|
$
|
(19,555
|
)
|
|
$
|
(23,376
|
)
|
|
$
|
(36,388
|
)
|
|
$
|
(97,499
|
)
|
Foreign currency translation adjustment
|
502
|
|
|
(3,535
|
)
|
|
493
|
|
|
(2,057
|
)
|
Comprehensive loss
|
(19,053
|
)
|
|
(26,911
|
)
|
|
(35,895
|
)
|
|
(99,556
|
)
|
Comprehensive loss attributable to noncontrolling interests
|
386
|
|
|
378
|
|
|
440
|
|
|
269
|
|
Comprehensive loss attributable to FelCor LP
|
$
|
(18,667
|
)
|
|
$
|
(26,533
|
)
|
|
$
|
(35,455
|
)
|
|
$
|
(99,287
|
)
|
The accompanying notes are an integral part of these consolidated financial statements.
FELCOR LODGING LIMITED PARTNERSHIP
CONSOLIDATED STATEMENTS OF PARTNERS’ CAPITAL
For the
Nine
Months Ended
September 30, 2012
and
2011
(unaudited, in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred Units
|
|
Common Units
|
|
Accumulated Other Comprehensive Income
|
|
Noncontrolling Interests
|
|
Comprehensive Loss
|
|
Total Partners’ Capital
|
Balance at December 31, 2010
|
|
$
|
478,774
|
|
|
$
|
63,235
|
|
|
$
|
26,574
|
|
|
$
|
19,795
|
|
|
|
|
$
|
588,378
|
|
Issuance of common units
|
|
—
|
|
|
158,476
|
|
|
—
|
|
|
—
|
|
|
|
|
158,476
|
|
FelCor restricted stock compensation
|
|
—
|
|
|
2,876
|
|
|
—
|
|
|
—
|
|
|
|
|
2,876
|
|
Contributions
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,646
|
|
|
|
|
6,646
|
|
Distributions
|
|
—
|
|
|
(29,034
|
)
|
|
—
|
|
|
(868
|
)
|
|
|
|
(29,902
|
)
|
Allocation to redeemable units
|
|
—
|
|
|
1,550
|
|
|
—
|
|
|
—
|
|
|
|
|
1,550
|
|
Other
|
|
—
|
|
|
(70
|
)
|
|
—
|
|
|
—
|
|
|
|
|
(70
|
)
|
Comprehensive loss:
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign exchange translation
|
|
|
|
|
|
|
|
(2,057
|
)
|
|
|
|
|
$
|
(2,057
|
)
|
|
|
Net loss
|
|
|
|
|
(97,230
|
)
|
|
|
|
|
(269
|
)
|
|
(97,499
|
)
|
|
|
Comprehensive loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(99,556
|
)
|
|
(99,556
|
)
|
Balance at September 30, 2011
|
|
$
|
478,774
|
|
|
$
|
99,803
|
|
|
$
|
24,517
|
|
|
$
|
25,304
|
|
|
|
|
$
|
628,398
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at December 31, 2011
|
|
$
|
478,774
|
|
|
$
|
56,916
|
|
|
$
|
25,848
|
|
|
$
|
25,357
|
|
|
|
|
$
|
586,895
|
|
FelCor restricted stock compensation
|
|
—
|
|
|
623
|
|
|
—
|
|
|
—
|
|
|
|
|
623
|
|
Contributions
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,756
|
|
|
|
|
2,756
|
|
Distributions
|
|
—
|
|
|
(29,034
|
)
|
|
—
|
|
|
(931
|
)
|
|
|
|
(29,965
|
)
|
Allocation to redeemable units
|
|
—
|
|
|
(210
|
)
|
|
—
|
|
|
—
|
|
|
|
|
(210
|
)
|
Other
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
|
|
(4
|
)
|
Comprehensive loss:
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign exchange translation
|
|
|
|
|
|
|
|
493
|
|
|
|
|
|
$
|
493
|
|
|
|
Net loss
|
|
|
|
|
(35,948
|
)
|
|
|
|
|
(440
|
)
|
|
(36,388
|
)
|
|
|
Comprehensive loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(35,895
|
)
|
|
(35,895
|
)
|
Balance at September 30, 2012
|
|
$
|
478,774
|
|
|
$
|
(7,657
|
)
|
|
$
|
26,341
|
|
|
$
|
26,742
|
|
|
|
|
$
|
524,200
|
|
The accompanying notes are an integral part of these consolidated financial statements.
FELCOR LODGING LIMITED PARTNERSHIP
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the
Nine
Months Ended
September 30, 2012
and
2011
(unaudited, in thousands)
|
|
|
|
|
|
|
|
|
|
Nine Months Ended September 30,
|
|
2012
|
|
2011
|
Cash flows from operating activities:
|
|
|
|
Net loss
|
$
|
(36,388
|
)
|
|
$
|
(97,499
|
)
|
Adjustments to reconcile net loss to net cash provided by operating activities:
|
|
|
|
Depreciation and amortization
|
97,477
|
|
|
105,058
|
|
Gain on sale of hotels, net
|
(26,641
|
)
|
|
(7,362
|
)
|
Gain on involuntary conversion, net
|
—
|
|
|
(280
|
)
|
Amortization of deferred financing fees and debt discount
|
13,646
|
|
|
13,390
|
|
Amortization of unearned officers’ and directors’ compensation
|
3,748
|
|
|
5,343
|
|
Equity in loss (income) from unconsolidated entities
|
(2,674
|
)
|
|
1,303
|
|
Distributions of income from unconsolidated entities
|
3,431
|
|
|
1,534
|
|
Debt extinguishment, net
|
12,598
|
|
|
24,316
|
|
Impairment loss
|
1,335
|
|
|
13,250
|
|
Changes in assets and liabilities:
|
|
|
|
Accounts receivable
|
(7,649
|
)
|
|
(6,998
|
)
|
Restricted cash - operations
|
—
|
|
|
2,663
|
|
Other assets
|
(6,194
|
)
|
|
(9,843
|
)
|
Accrued expenses and other liabilities
|
20,118
|
|
|
(8,444
|
)
|
Net cash flow provided by operating activities
|
72,807
|
|
|
36,431
|
|
Cash flows from investing activities:
|
|
|
|
Acquisition of hotels
|
—
|
|
|
(137,985
|
)
|
Improvements and additions to hotels
|
(99,985
|
)
|
|
(57,470
|
)
|
Hotel development
|
(16,707
|
)
|
|
—
|
|
Additions to condominium project
|
—
|
|
|
(359
|
)
|
Proceeds from asset dispositions
|
124,610
|
|
|
96,435
|
|
Change in restricted cash – investing
|
2,598
|
|
|
(116,258
|
)
|
Insurance proceeds
|
—
|
|
|
391
|
|
Distributions from unconsolidated entities
|
11,894
|
|
|
1,386
|
|
Net cash flow provided by (used in) investing activities
|
22,410
|
|
|
(213,860
|
)
|
Cash flows from financing activities:
|
|
|
|
Proceeds from borrowings
|
378,750
|
|
|
1,087,285
|
|
Repayment of borrowings
|
(395,355
|
)
|
|
(1,112,414
|
)
|
Payment of deferred financing fees
|
(3,167
|
)
|
|
(18,797
|
)
|
Distributions paid to noncontrolling interests
|
(931
|
)
|
|
(868
|
)
|
Contributions from noncontrolling interests
|
2,756
|
|
|
6,646
|
|
Distributions paid to preferred unitholders
|
(59,021
|
)
|
|
(29,035
|
)
|
Net proceeds from common unit issuance
|
—
|
|
|
158,476
|
|
Proceeds from redeemable unit issuance
|
—
|
|
|
2,500
|
|
Net cash flow provided by (used in) financing activities
|
(76,968
|
)
|
|
93,793
|
|
Effect of exchange rate changes on cash
|
112
|
|
|
(153
|
)
|
Net change in cash and cash equivalents
|
18,361
|
|
|
(83,789
|
)
|
Cash and cash equivalents at beginning of periods
|
93,758
|
|
|
200,972
|
|
Cash and cash equivalents at end of periods
|
$
|
112,119
|
|
|
$
|
117,183
|
|
|
|
|
|
Supplemental cash flow information – interest paid, net of capitalized interest
|
$
|
61,700
|
|
|
$
|
92,518
|
|
The accompanying notes are an integral part of these consolidated financial statements.
FELCOR LODGING TRUST INCORPORATED AND FELCOR LODGING LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FelCor Lodging Trust Incorporated (NYSE:FCH), or FelCor, is a Maryland corporation, operating as a real estate investment trust, or REIT. FelCor is the sole general partner of, and the owner of a greater than
99%
partnership interest in, FelCor Lodging Limited Partnership, or FelCor LP, through which we held ownership interests in (i)
67
hotels in continuing operations with
19,335
rooms and (ii)
two
hotels designated as held for sale at
September 30, 2012
. At
September 30, 2012
, we had
124,853,983
shares and units outstanding, consisting of
124,229,031
shares of FelCor common stock and
624,952
FelCor LP units not owned by FelCor.
Of the
67
hotels included in continuing operations, we owned a
100%
interest in
49
hotels, a
90%
interest in entities owning
three
hotels, an
82%
interest in an entity owning
one
hotel, a
60%
interest in an entity owning
one
hotel and a
50%
interest in entities owning
13
hotels. We consolidate our real estate interests in the
54
hotels in which we held majority interests, and we record the real estate interests of the
13
hotels in which we held
50%
interests using the equity method. We leased
66
of the
67
hotels in continuing operations to our taxable REIT subsidiaries, of which we own a controlling interest.
One
50%
owned hotel was operated without a lease. Because we owned controlling interests in these lessees, we consolidated our interests in these
66
hotels (which we refer to as our Consolidated Hotels) and reflect those hotels’ operating revenues and expenses in our statement of operations. Of our Consolidated Hotels, we owned
50%
of the real estate interests in each of
12
hotels (we accounted for the ownership in our real estate interests of these hotels by the equity method) and majority real estate interests in each of the remaining
54
hotels (we consolidate our real estate interest in these hotels).
The following table illustrates the distribution of our
66
Consolidated Hotels at
September 30, 2012
:
|
|
|
|
|
|
|
|
|
|
Brand
|
|
Hotels
|
|
Rooms
|
Embassy Suites Hotels
®
|
|
35
|
|
|
|
9,116
|
|
|
Holiday Inn
®
|
|
13
|
|
|
|
4,388
|
|
|
Sheraton
®
and Westin
®
|
|
6
|
|
|
|
2,224
|
|
|
Doubletree
®
and Hilton
®
|
|
6
|
|
|
|
1,450
|
|
|
Marriott
®
and Renaissance
®
|
|
3
|
|
|
|
1,321
|
|
|
Fairmont
®
|
|
1
|
|
|
|
383
|
|
|
Independent (Morgans and Royalton)
|
|
2
|
|
|
|
282
|
|
|
Total
|
|
66
|
|
|
|
19,164
|
|
|
At
September 30, 2012
, our Consolidated Hotels were located in the United States (
65
hotels in
22
states) and Canada (
one
hotel in Ontario), with concentrations in California (
14
hotels), Florida (
8
hotels) and Texas (
7
hotels). Approximately
49%
of our hotel room revenues were generated from hotels in these
three
states during the first
nine
months of
2012
.
At
September 30, 2012
, of our
66
Consolidated Hotels: (i) subsidiaries of Hilton Hotels Corporation, or Hilton, managed
40
hotels, (ii) subsidiaries of InterContinental Hotels Group, or IHG, managed
13
hotels, (iii) subsidiaries of Starwood Hotels & Resorts Worldwide Inc., or Starwood, managed
six
hotels, (iv) subsidiaries of Marriott International Inc., or Marriott, managed
three
hotels, (v) a subsidiary of Fairmont Hotels and Resorts, or Fairmont, managed
one
hotel, (vi) a subsidiary of Morgans Hotel Group Corp. managed
two
hotels, and (vii) an independent management company managed
one
hotel.
FELCOR LODGING TRUST INCORPORATED AND FELCOR LODGING LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. Organization — (continued)
In addition to the above hotels, we own (through a
95%
interest in a consolidated joint venture) the Knickerbocker, a former hotel and office building, that is being redeveloped as a 4+ star hotel in midtown Manhattan and is expected to open at the end of 2013.
Our hotels managed by Marriott are accounted for on a fiscal year comprised of
52
or
53
weeks ending on the Friday closest to
December 31
. Our
three
-month periods ending
September 30, 2012
and
2011
include the results of operations for our Marriott-managed hotels for the
12
week periods ending September 7, 2012 and September 9, 2011, respectively.
The information in our consolidated financial statements for the
three and nine
months ended
September 30, 2012
and
2011
is unaudited. Preparing financial statements in conformity with accounting principles generally accepted in the United States of America, or GAAP, requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. The accompanying financial statements for the
three and nine
months ended
September 30, 2012
and
2011
, include adjustments based on management’s estimates (consisting of normal and recurring accruals), which we consider necessary for a fair presentation of the results for the periods. The financial information should be read in conjunction with the consolidated financial statements for the year ended
December 31, 2011
, included in our Annual Report on Form 10-K. Operating results for the
three and nine
months ended
September 30, 2012
are not necessarily indicative of actual operating results for the entire year.
|
|
2.
|
Investment in Unconsolidated Entities
|
We owned
50%
interests in joint ventures that owned
13
hotels at
September 30, 2012
and
December 31, 2011
. We also own
50%
interests in entities that own real estate in Myrtle Beach, South Carolina and provide condominium management services. We account for our investments in these unconsolidated entities under the equity method. We do not have any majority-owned subsidiaries that are not consolidated in our financial statements. We make adjustments to our equity in income from unconsolidated entities related to the difference between our basis in investment in unconsolidated entities compared to the historical basis of the assets recorded by the joint ventures.
The following table summarizes combined balance sheet information for our unconsolidated entities (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
September 30,
|
|
December 31,
|
|
2012
|
|
2011
|
Investment in hotels, net of accumulated depreciation
|
$
|
160,297
|
|
|
|
$
|
173,310
|
|
|
Total assets
|
$
|
174,051
|
|
|
|
$
|
199,063
|
|
|
Debt
|
$
|
148,899
|
|
|
|
$
|
150,388
|
|
|
Total liabilities
|
$
|
154,103
|
|
|
|
$
|
156,607
|
|
|
Equity
|
$
|
19,948
|
|
|
|
$
|
42,456
|
|
|
Our unconsolidated entities’ debt at
September 30, 2012
and
December 31, 2011
consisted entirely of non-recourse mortgage debt. In January 2012, one of our unconsolidated joint ventures refinanced
$130 million
of debt and extended the maturity until 2014.
FELCOR LODGING TRUST INCORPORATED AND FELCOR LODGING LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
2.
|
Investment in Unconsolidated Entities — (continued)
|
The following table sets forth summarized combined statement of operations information for our unconsolidated entities (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
Total revenues
|
$
|
21,075
|
|
|
|
$
|
19,975
|
|
|
|
$
|
54,012
|
|
|
|
$
|
49,990
|
|
|
Net income
|
$
|
4,002
|
|
|
|
$
|
1,428
|
|
|
|
$
|
8,138
|
|
|
|
$
|
184
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income attributable to FelCor
|
$
|
2,001
|
|
|
|
$
|
714
|
|
|
|
$
|
4,069
|
|
|
|
$
|
92
|
|
|
Depreciation of cost in excess of book value
|
(465
|
)
|
|
|
(465
|
)
|
|
|
(1,395
|
)
|
|
|
(1,395
|
)
|
|
Equity in income (loss) from unconsolidated entities
|
$
|
1,536
|
|
|
|
$
|
249
|
|
|
|
$
|
2,674
|
|
|
|
$
|
(1,303
|
)
|
|
The following table summarizes the components of our investment in unconsolidated entities (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
September 30,
|
|
December 31,
|
|
2012
|
|
2011
|
Hotel-related investments
|
$
|
1,467
|
|
|
|
$
|
12,400
|
|
|
Cost in excess of book value of hotel investments
|
47,378
|
|
|
|
48,774
|
|
|
Land and condominium investments
|
8,507
|
|
|
|
8,828
|
|
|
|
$
|
57,352
|
|
|
|
$
|
70,002
|
|
|
The following table summarizes the components of our equity in income (loss) from unconsolidated entities (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
September 30,
|
|
September 30,
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
Hotel investments
|
$
|
1,055
|
|
|
$
|
(199
|
)
|
|
$
|
2,746
|
|
|
$
|
(1,127
|
)
|
Other investments
|
481
|
|
|
448
|
|
|
(72
|
)
|
|
(176
|
)
|
Equity in income (loss) from unconsolidated entities
|
$
|
1,536
|
|
|
$
|
249
|
|
|
$
|
2,674
|
|
|
$
|
(1,303
|
)
|
FELCOR LODGING TRUST INCORPORATED AND FELCOR LODGING LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Consolidated debt consisted of the following (dollars in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Encumbered
|
|
Interest
|
|
Maturity
|
|
September 30,
|
|
December 31,
|
|
|
Hotels
|
|
Rate (%)
|
|
Date
|
|
2012
|
|
2011
|
Line of credit
|
|
10
|
|
|
|
L + 4.50
|
|
|
|
August 2014
(a)
|
|
$
|
117,000
|
|
|
$
|
—
|
|
Hotel mortgage debt
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage debt
|
|
5
|
|
(b)
|
|
6.66
|
|
|
|
June - August 2014
|
|
65,935
|
|
|
67,375
|
|
Mortgage debt
|
|
7
|
|
|
|
L + 5.10
|
|
(c)
|
|
April 2015
|
|
186,529
|
|
|
202,982
|
|
Mortgage debt
|
|
1
|
|
|
|
5.81
|
|
|
|
July 2016
|
|
10,521
|
|
|
10,876
|
|
Mortgage debt
|
|
4
|
|
(b)
|
|
4.95
|
|
|
|
October 2022
|
|
128,500
|
|
|
—
|
|
Mortgage debt
|
|
1
|
|
|
|
4.94
|
|
|
|
October 2022
|
|
32,250
|
|
|
—
|
|
Senior notes
|
|
|
|
|
|
|
|
|
|
|
|
|
Senior secured notes
|
|
6
|
|
|
|
6.75
|
|
|
|
June 2019
|
|
525,000
|
|
|
525,000
|
|
Senior secured notes
(d)
|
|
11
|
|
|
|
10.00
|
|
|
|
October 2014
|
|
467,499
|
|
|
459,931
|
|
Other
(e)
|
|
—
|
|
|
|
L + 1.50
|
|
|
|
December 2012
|
|
64,860
|
|
|
64,860
|
|
Retired debt
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
—
|
|
|
265,442
|
|
Total
|
|
45
|
|
|
|
|
|
|
|
|
$
|
1,598,094
|
|
|
$
|
1,596,466
|
|
|
|
(a)
|
Our
$225 million
line of credit can be extended for
one
year (to 2015), subject to satisfying certain conditions.
|
|
|
(b)
|
The hotels securing this debt are subject to separate loan agreements and are not cross-collateralized.
|
|
|
(c)
|
LIBOR (for this loan) is subject to a
3%
floor. We purchased an interest rate cap (
$202 million
notional amount) that caps
LIBOR
at
5.4%
and expires May 2013.
|
|
|
(d)
|
These notes have
$492 million
in aggregate principal outstanding (
$144 million
and
$96,000
in aggregate principal amount was redeemed in June 2011 and January 2012, respectively)
and were initially sold at a discount that provided an effective yield of
12.875%
before transaction costs.
|
|
|
(e)
|
This loan is related to our Knickerbocker redevelopment project and is fully secured by restricted cash and a mortgage. Because we were able to assume an existing loan when we purchased this hotel, we were not required to pay any local mortgage recording tax. When that loan is transferred to a new lender and made part of our construction loan, we expect to only pay such tax to the extent of the incremental principal amount of the construction loan.
|
In May 2012, we repaid
$69.2 million
in secured loans when we sold the mortgaged hotels.
In August 2012, we repaid
$24.9 million
in secured loans when we sold a mortgaged hotel.
FELCOR LODGING TRUST INCORPORATED AND FELCOR LODGING LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
In September 2012, we obtained
$160.8 million
in gross proceeds from
five
mortgage loans. The
10
‑year loans mature in 2022, bear an average fixed interest rate of
4.95%
and are neither cross-collateralized nor cross-defaulting. A portion of the proceeds from the new loans was used to repay a
9.02%
mortgage loan, of which
$107 million
was outstanding, that would otherwise mature in 2014. The repaid loan was secured by a pool of
seven
hotels, including
four
of the
five
hotels mortgaged to support the new loans. The remaining
three
hotels (
two
of which are non-strategic) that secured the repaid loan are now unencumbered. Also in September 2012, we repaid the remaining
$60 million
balance of a mortgage loan using excess proceeds from the new loans as well as asset sale proceeds. This repaid loan, which would have otherwise matured in 2013, was secured by
five
properties, of which
four
are now unencumbered (
two
of which are non-strategic) and
one
was mortgaged to secure one of the new loans. The repayments resulted in
$11.6 million
in debt extinguishment costs, primarily prepayment penalties.
We reported
$31.4 million
and
$32.9 million
of interest expense for the
three
months ended
September 30, 2012
and
2011
, respectively, which is net of: (i) interest income of
$34,000
and
$59,000
and (ii) capitalized interest of
$3.1 million
and
$403,000
, respectively. We reported
$93.5 million
and
$98.2 million
of interest expense for the
nine
months ended
September 30, 2012
and
2011
, respectively, which is net of: (i) interest income of
$117,000
and
$151,000
and (ii) capitalized interest of
$9.7 million
and
$913,000
, respectively.
FELCOR LODGING TRUST INCORPORATED AND FELCOR LODGING LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
4.
|
Hotel Operating Revenue, Departmental Expenses, and Other Property-Related Costs
|
Hotel operating revenue from continuing operations was comprised of the following (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
September 30,
|
|
September 30,
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
Room revenue
|
$
|
188,886
|
|
|
|
$
|
177,858
|
|
|
|
$
|
544,664
|
|
|
|
$
|
507,375
|
|
|
Food and beverage revenue
|
33,673
|
|
|
|
30,288
|
|
|
|
109,472
|
|
|
|
104,102
|
|
|
Other operating departments
|
12,237
|
|
|
|
13,488
|
|
|
|
38,177
|
|
|
|
38,591
|
|
|
Total hotel operating revenue
|
$
|
234,796
|
|
|
|
$
|
221,634
|
|
|
|
$
|
692,313
|
|
|
|
$
|
650,068
|
|
|
Nearly all of our revenue is comprised of hotel operating revenue. These revenues are recorded net of any sales or occupancy taxes collected from our guests. All rebates or discounts are recorded, when allowed, as a reduction in revenue, and there are no material contingent obligations with respect to rebates or discounts offered by us. All revenues are recorded on an accrual basis, as earned. Appropriate allowances are made for doubtful accounts, which are recorded as a bad debt expense. The remainder of our revenue was derived from other sources.
Hotel departmental expenses from continuing operations were comprised of the following (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30,
|
|
2012
|
|
2011
|
|
Amount
|
|
% of Total Hotel Operating Revenue
|
|
Amount
|
|
% of Total Hotel Operating Revenue
|
Room
|
$
|
49,794
|
|
|
21.2
|
%
|
|
|
$
|
47,805
|
|
|
21.6
|
%
|
|
Food and beverage
|
29,176
|
|
|
12.4
|
|
|
|
26,892
|
|
|
12.1
|
|
|
Other operating departments
|
5,593
|
|
|
2.4
|
|
|
|
5,979
|
|
|
2.7
|
|
|
Total hotel departmental expenses
|
$
|
84,563
|
|
|
36.0
|
%
|
|
|
$
|
80,676
|
|
|
36.4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended September 30,
|
|
2012
|
|
2011
|
|
Amount
|
|
% of Total Hotel Operating Revenue
|
|
Amount
|
|
% of Total Hotel Operating Revenue
|
Room
|
$
|
144,419
|
|
|
20.9
|
%
|
|
|
$
|
135,514
|
|
|
20.8
|
%
|
|
Food and beverage
|
89,354
|
|
|
12.9
|
|
|
|
82,935
|
|
|
12.8
|
|
|
Other operating departments
|
16,976
|
|
|
2.4
|
|
|
|
17,555
|
|
|
2.7
|
|
|
Total hotel departmental expenses
|
$
|
250,749
|
|
|
36.2
|
%
|
|
|
$
|
236,004
|
|
|
36.3
|
%
|
|
FELCOR LODGING TRUST INCORPORATED AND FELCOR LODGING LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
4.
|
Hotel Operating Revenue, Departmental Expenses, and Other Property-Related Costs
— (continued)
|
Other property-related costs from continuing operations were comprised of the following amounts (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30,
|
|
2012
|
|
2011
|
|
Amount
|
|
% of Total Hotel Operating Revenue
|
|
Amount
|
|
% of Total Hotel Operating Revenue
|
Hotel general and administrative expense
|
$
|
20,920
|
|
|
8.9
|
|
|
$
|
20,202
|
|
|
9.1
|
|
Marketing
|
19,565
|
|
|
8.3
|
|
|
18,060
|
|
|
8.1
|
|
Repair and maintenance
|
11,914
|
|
|
5.1
|
|
|
11,514
|
|
|
5.2
|
|
Utilities
|
11,541
|
|
|
4.9
|
|
|
12,168
|
|
|
5.5
|
|
Total other property-related costs
|
$
|
63,940
|
|
|
27.2
|
|
|
$
|
61,944
|
|
|
27.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended September 30,
|
|
2012
|
|
2011
|
|
Amount
|
|
% of Total Hotel Operating Revenue
|
|
Amount
|
|
% of Total Hotel Operating Revenue
|
Hotel general and administrative expense
|
$
|
62,972
|
|
|
9.1
|
|
|
$
|
59,260
|
|
|
9.1
|
|
Marketing
|
59,008
|
|
|
8.5
|
|
|
54,165
|
|
|
8.3
|
|
Repair and maintenance
|
35,817
|
|
|
5.2
|
|
|
33,625
|
|
|
5.2
|
|
Utilities
|
30,631
|
|
|
4.4
|
|
|
32,349
|
|
|
5.0
|
|
Total other property-related costs
|
$
|
188,428
|
|
|
27.2
|
|
|
$
|
179,399
|
|
|
27.6
|
|
FELCOR LODGING TRUST INCORPORATED AND FELCOR LODGING LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
5.
|
Taxes, Insurance and Lease Expense
|
Taxes, insurance and lease expense from continuing operations were comprised of the following (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
September 30,
|
|
September 30,
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
Hotel lease expense
(a)
|
$
|
10,910
|
|
|
$
|
10,582
|
|
|
$
|
31,339
|
|
|
$
|
29,383
|
|
Land lease expense
(b)
|
3,381
|
|
|
3,130
|
|
|
8,568
|
|
|
7,991
|
|
Real estate and other taxes
|
8,359
|
|
|
7,394
|
|
|
24,267
|
|
|
20,865
|
|
Property insurance, general liability insurance and other
|
2,703
|
|
|
1,909
|
|
|
7,809
|
|
|
5,992
|
|
Total taxes, insurance and lease expense
|
$
|
25,353
|
|
|
$
|
23,015
|
|
|
$
|
71,983
|
|
|
$
|
64,231
|
|
|
|
(a)
|
Hotel lease expense is recorded by the consolidated operating lessees of
12
hotels owned by unconsolidated entities and is partially (generally
49%
) offset through noncontrolling interests in other partnerships. Our
50%
share of the corresponding lease income is recorded through equity in income from unconsolidated entities. Hotel lease expense includes percentage rent of
$5.5 million
and
$5.2 million
for the
three
months ended
September 30, 2012
and
2011
, respectively, and
$15.0 million
and
$13.3 million
for the
nine
months ended
September 30, 2012
and
2011
, respectively.
|
|
|
(b)
|
Land lease expense includes percentage rent of
$2.0 million
and
$1.7 million
for the
three
months ended
September 30, 2012
and
2011
, respectively, and
$4.3 million
and
$3.6 million
for the
nine
months ended
September 30, 2012
and
2011
, respectively.
|
FELCOR LODGING TRUST INCORPORATED AND FELCOR LODGING LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Our hotels are comprised of operations and cash flows that can clearly be distinguished, operationally and for financial reporting purposes, from the remainder of our operations. Accordingly, we consider our hotels to be components for purposes of determining impairment charges and reporting discontinued operations.
We may record impairment charges if operating results of individual hotels are materially different from our forecasts, if the economy and/or lodging industry weakens, or if we shorten our contemplated holding period for additional hotels. During the quarter ended June 30, 2012, we recorded a
$1.3 million
impairment charge related to
one
hotel included in continuing operations. The impairment charge related to this hotel was based on a third-party offer to purchase (a Level 2 input under authoritative guidance for fair value measurements) at a price below our previously estimated fair market value.
During the quarter ended September 30, 2011, we recorded a
$946,000
impairment charge in discontinued operations for one hotel to reduce our carrying value to its fair value less estimated selling costs. Our fair value estimate was based on the purchaser's contract price (a Level 2 input).
During the quarter ended June 30, 2011, we recorded
$12.3 million
of impairment charges (
$7.0 million
related to
two
hotels in continuing operations and
$5.3 million
related to
two
hotels in discontinued operations). The impairment charges for
three
of the hotel
s were based on revised estimated fair market values obtained through the marketing process that were lower than the net book values for these hotels. The inputs used to determine the fair values of these hotels are classified as Level 2 under authoritative guidance for fair value measurements. The impairment charge related to the remaining hotel in discontinued operations was primarily related to estimated selling costs.
FELCOR LODGING TRUST INCORPORATED AND FELCOR LODGING LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
7.
|
Discontinued Operations
|
We had
two
hotels held for sale at
September 30, 2012
. We consider a sale to be probable within the next
twelve
months and classify it as held for sale when a buyer completes its due diligence review, we have an executed contract for sale, and we have received a substantial non-refundable deposit.
Discontinued operations include results of operations for
two
hotels designated as held for sale at
September 30, 2012
,
one
hotel sold in August 2012,
six
hotels which were sold in May 2012 and
eight
hotels sold in 2011. The following table summarizes the condensed financ
ial information for those hotels (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
September 30,
|
|
September 30,
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
Hotel operating revenue
|
$
|
7,558
|
|
|
|
$
|
25,477
|
|
|
|
$
|
49,506
|
|
|
|
$
|
99,556
|
|
|
Operating expenses
|
(7,065
|
)
|
|
|
(25,684
|
)
|
(a)
|
|
(40,831
|
)
|
|
|
(97,265
|
)
|
(a)
|
Operating income (loss) from discontinued operations
|
493
|
|
|
|
(207
|
)
|
|
|
8,675
|
|
|
|
2,291
|
|
|
Interest expense, net
|
(239
|
)
|
|
|
(799
|
)
|
|
|
(1,991
|
)
|
|
|
(4,548
|
)
|
|
Debt extinguishment, net
|
(126
|
)
|
|
|
(334
|
)
|
|
|
(790
|
)
|
|
|
3,282
|
|
|
Loss on involuntary conversion, net
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(12
|
)
|
|
Gain on sale of hotels, net
|
9,922
|
|
|
|
701
|
|
|
|
26,641
|
|
|
|
7,362
|
|
|
Income (loss) from discontinued operations
|
$
|
10,050
|
|
|
|
$
|
(639
|
)
|
|
|
$
|
32,535
|
|
|
|
$
|
8,375
|
|
|
|
|
(a)
|
Includes a
$946,000
impairment charge for the three months ended September 30, 2011 and a
$6.2 million
impairment charge for the nine months ended September 30, 2011.
|
FELCOR LODGING TRUST INCORPORATED AND FELCOR LODGING LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The following tables set forth the computation of basic and diluted income (loss) per share/unit (in thousands, except per share/unit data):
FelCor Loss Per Share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
September 30,
|
|
September 30,
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
Numerator:
|
|
|
|
|
|
|
|
Net loss attributable to FelCor
|
$
|
(19,025
|
)
|
|
$
|
(22,832
|
)
|
|
$
|
(35,619
|
)
|
|
$
|
(96,761
|
)
|
Discontinued operations attributable to FelCor
|
(10,000
|
)
|
|
623
|
|
|
(32,372
|
)
|
|
(8,361
|
)
|
Loss from continuing operations attributable to FelCor
|
(29,025
|
)
|
|
(22,209
|
)
|
|
(67,991
|
)
|
|
(105,122
|
)
|
Less: Preferred dividends
|
(9,678
|
)
|
|
(9,678
|
)
|
|
(29,034
|
)
|
|
(29,034
|
)
|
Numerator for continuing operations attributable to FelCor common stockholders
|
(38,703
|
)
|
|
(31,887
|
)
|
|
(97,025
|
)
|
|
(134,156
|
)
|
Discontinued operations attributable to FelCor
|
10,000
|
|
|
(623
|
)
|
|
32,372
|
|
|
8,361
|
|
Numerator for basic and diluted loss attributable to FelCor common stockholders
|
$
|
(28,703
|
)
|
|
$
|
(32,510
|
)
|
|
$
|
(64,653
|
)
|
|
$
|
(125,795
|
)
|
Denominator:
|
|
|
|
|
|
|
|
Denominator for basic and diluted loss per share
|
123,640
|
|
|
123,062
|
|
|
123,648
|
|
|
113,908
|
|
Basic and diluted loss per share data:
|
|
|
|
|
|
|
|
Loss from continuing operations
|
$
|
(0.31
|
)
|
|
$
|
(0.26
|
)
|
|
$
|
(0.78
|
)
|
|
$
|
(1.18
|
)
|
Discontinued operations
|
$
|
0.08
|
|
|
$
|
(0.01
|
)
|
|
$
|
0.26
|
|
|
$
|
0.07
|
|
Net loss
|
$
|
(0.23
|
)
|
|
$
|
(0.26
|
)
|
|
$
|
(0.52
|
)
|
|
$
|
(1.10
|
)
|
FELCOR LODGING TRUST INCORPORATED AND FELCOR LODGING LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
8.
|
Loss Per Share/Unit
— (continued)
|
FelCor LP Loss Per Unit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
September 30,
|
|
September 30,
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
Numerator:
|
|
|
|
|
|
|
|
Net loss attributable to FelCor LP
|
$
|
(19,169
|
)
|
|
$
|
(22,998
|
)
|
|
$
|
(35,948
|
)
|
|
$
|
(97,230
|
)
|
Discontinued operations attributable to FelCor LP
|
(10,050
|
)
|
|
626
|
|
|
(32,535
|
)
|
|
(8,388
|
)
|
Loss from continuing operations attributable to FelCor LP
|
(29,219
|
)
|
|
(22,372
|
)
|
|
(68,483
|
)
|
|
(105,618
|
)
|
Less: Preferred distributions
|
(9,678
|
)
|
|
(9,678
|
)
|
|
(29,034
|
)
|
|
(29,034
|
)
|
Numerator for continuing operations attributable to FelCor LP common unitholders
|
(38,897
|
)
|
|
(32,050
|
)
|
|
(97,517
|
)
|
|
(134,652
|
)
|
Discontinued operations attributable to FelCor LP
|
10,050
|
|
|
(626
|
)
|
|
32,535
|
|
|
8,388
|
|
Numerator for basic and diluted loss attributable to FelCor common unitholders
|
$
|
(28,847
|
)
|
|
$
|
(32,676
|
)
|
|
$
|
(64,982
|
)
|
|
$
|
(126,264
|
)
|
Denominator:
|
|
|
|
|
|
|
|
Denominator for basic and diluted loss per unit
|
124,266
|
|
|
123,700
|
|
|
124,278
|
|
|
114,361
|
|
Basic and diluted loss per unit data:
|
|
|
|
|
|
|
|
Loss from continuing operations
|
$
|
(0.31
|
)
|
|
$
|
(0.26
|
)
|
|
$
|
(0.78
|
)
|
|
$
|
(1.18
|
)
|
Discontinued operations
|
$
|
0.08
|
|
|
$
|
(0.01
|
)
|
|
$
|
0.26
|
|
|
$
|
0.07
|
|
Net loss
|
$
|
(0.23
|
)
|
|
$
|
(0.26
|
)
|
|
$
|
(0.52
|
)
|
|
$
|
(1.10
|
)
|
Securities that could potentially dilute earnings per share/unit in the future that were not included in the computation of diluted income (loss) per share/unit, because they would have been antidilutive for the periods presented, are as follows (in thousands):
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
September 30,
|
|
September 30,
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
Series A convertible preferred shares/units
|
9,985
|
|
9,985
|
|
9,985
|
|
9,985
|
Series A preferred dividends (distributions) that would be excluded from net income (loss) attributable to FelCor common stockholders (or FelCor LP common unitholders), if these Series A preferred shares/units were dilutive, were
$6.3 million
for the
three
months ended
September 30, 2012
and
2011
, and
$18.8 million
for the
nine
months ended
September 30, 2012
and
2011
.
FELCOR LODGING TRUST INCORPORATED AND FELCOR LODGING LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
9.
|
Dividends/Distributions
|
In January 2011, FelCor reinstated its current quarterly preferred dividend and has paid current quarterly preferred dividends each quarter since January 2011. At December 31, 2011, we had
$76.3 million
of aggregate accrued dividends (of which
$67.7 million
related to dividends in arrears) payable to holders of our Series A and Series C preferred stock.
In July 2012, FelCor paid quarterly dividends of
$0.4875
per share to holders of its Series A preferred stock and
$0.50
per depositary share to holders of its Series C preferred stock. In addition, FelCor paid
$1.51
per share and
$1.55
per depositary share to its Series A preferred stockholders and Series C preferred stockholders, respectively, for dividends in arrears. Proceeds received from the sale of
six
hotels in May 2012 were used to fund a
$30.0 million
dividend in arrears payment.
At September 30, 2012, FelCor had
$46.3 million
of aggregate accrued dividends (of which
$37.7 million
related to dividends in arrears). On October 31, FelCor paid dividends of
$2.39
per share to holders of its Series A preferred stock and
$2.45
per depositary share to holders of its Series C preferred stock. The dividend payment included dividends in arrears of
$1.9025
per share and
$1.95
per depositary share for holders of Series A and Series C preferred stock, respectively. FelCor has now paid all of the outstanding accrued preferred dividends.
FelCor obtains funds from FelCor LP to pay common or preferred dividends. We are restricted from paying any common dividends unless and until all accrued and current preferred dividends are paid. FelCor’s Board of Directors will determine whether and when to declare future dividends based upon various factors, including operating results, economic conditions, other operation trends, our financial condition (and related debt covenant compliance) and capital requirements, as well as minimum REIT distribution requirements.
|
|
10.
|
Fair Value of Financial Instruments
|
Disclosures about fair value of our financial instruments are based on pertinent information available to management as of
September 30, 2012
. Considerable judgment is necessary to interpret market data and develop estimated fair value. Accordingly, the estimates presented herein are not necessarily indicative of the amounts that we could realize on disposition of the financial instruments. The use of different market assumptions and/or estimation methodologies may have a material effect on estimated fair value amounts.
Our estimates of the fair value of (i) cash and cash equivalents, restricted cash, accounts receivable, accounts payable and accrued expenses approximate carrying value due to the relatively short maturity of these instruments; (ii) our publicly-traded debt is based on observable market data (a Level 2 input) and has an estimated fair value of
$1.1 billion
at
September 30, 2012
and
December 31, 2011
; and (iii) our debt that is not publicly-traded is based on a discounted cash flow model using effective borrowing rates for debt with similar terms, loan to estimated fair value of collateral and remaining maturities (a Level 3 input) and has an estimated fair value of
$631.2 million
and
$640.9 million
at
September 30, 2012
and
December 31, 2011
, respectively. The estimated fair value of all our debt was
$1.8 billion
and
$1.7 billion
at
September 30, 2012
and
December 31, 2011
, respectively.
FELCOR LODGING TRUST INCORPORATED AND FELCOR LODGING LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
11.
|
Redeemable Noncontrolling Interests in FelCor LP / Redeemable Units
|
We record redeemable noncontrolling interests in FelCor LP, in the case of FelCor, and redeemable units, in the case of FelCor LP, in the mezzanine section (between liabilities and equity or partners’ capital) of our consolidated balance sheets because of the redemption feature of these units. Additionally, FelCor’s consolidated statements of operations separately present earnings attributable to redeemable noncontrolling interests. We adjust redeemable noncontrolling interests in FelCor LP (or redeemable units) each period to reflect the greater of its carrying value based on the accumulation of historical cost or its redemption value. The historical cost is based on the proportionate relationship between the carrying value of equity associated with FelCor’s common stockholders relative to that of FelCor LP’s unitholders. Redemption value is based on the closing price of FelCor’s common stock at period end. FelCor allocates net income (loss) to FelCor LP’s noncontrolling partners based on their weighted average ownership percentage during the period.
At
September 30, 2012
, we had
624,952
limited partnership units outstanding. We sold
367,647
units of limited partner interest in our operating partnership at
$6.80
per unit in May 2011. At September 30, 2012, these units are carried at
$2.0 million
, which is the issue price less the holders’ share of allocated losses for the period the units were outstanding. We carried the remaining
257,305
outstanding units of limited partner interest at
$1.2 million
, based on the closing price of FelCor’s common stock at
September 30, 2012
(
$4.74
/share).
Changes in redeemable noncontrolling interests (or redeemable units) for the
nine
months ended
September 30, 2012
and
2011
are shown below (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended
|
|
September 30,
|
|
2012
|
|
2011
|
Balance at beginning of period
|
$
|
3,026
|
|
|
|
$
|
2,004
|
|
|
Issuance of units
|
—
|
|
|
|
2,500
|
|
|
Conversion of units
|
(45
|
)
|
|
|
(97
|
)
|
|
Redemption value allocation
|
581
|
|
|
|
(970
|
)
|
|
Comprehensive loss:
|
|
|
|
|
|
Foreign exchange translation
|
3
|
|
|
|
(14
|
)
|
|
Net loss
|
(329
|
)
|
|
|
(469
|
)
|
|
Balance at end of period
|
$
|
3,236
|
|
|
|
$
|
2,954
|
|
|
FELCOR LODGING TRUST INCORPORATED AND FELCOR LODGING LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
12.
|
FelCor LP’s Consolidating Financial Information
|
Certain of FelCor LP’s
100%
owned subsidiaries (FelCor/CSS Holdings, L.P.; FelCor Lodging Holding Company, L.L.C.; FelCor TRS Borrower 1, L.P.; FelCor TRS Borrower 4, L.L.C.; FelCor TRS Holdings, L.L.C.; FelCor Canada Co.; FelCor/St. Paul Holdings, L.P.; FelCor Hotel Asset Company, L.L.C.; FelCor Copley Plaza, L.L.C.; FelCor St. Pete (SPE), L.L.C.; FelCor Esmeralda (SPE), L.L.C.; Los Angeles International Airport Hotel Associates, a Texas L.P.; Madison 237 Hotel, L.L.C.; and Royalton 44 Hotel, L.L.C., collectively, “Subsidiary Guarantors”), together with FelCor, guarantee, fully and unconditionally, except where subject to customary release provisions as described below, and jointly and severally, our senior debt.
The guarantees by the Subsidiary Guarantors may be automatically and unconditionally released upon (1) the sale or other disposition of all of the capital stock of the Subsidiary Guarantor or the sale or disposition of all or substantially all of the assets of the Subsidiary Guarantor, (2) the consolidation or merger of any such Subsidiary Guarantor with any person other than FelCor LP, or a subsidiary of FelCor LP, if, as a result of such consolidation or merger, such Subsidiary Guarantor ceases to be a subsidiary of FelCor LP, (3) a legal defeasance or covenant defeasance of the indenture, (4) the unconditional and complete release of such Subsidiary Guarantor in accordance with the modification and waiver provisions of the indenture, or (5) the designation of a restricted subsidiary that is a Subsidiary Guarantor as an unrestricted subsidiary under and in compliance with the indenture.
The following tables present consolidating information for the Subsidiary Guarantors.
FELCOR LODGING TRUST INCORPORATED AND FELCOR LODGING LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
12.
|
FelCor LP’s Consolidating Financial Information – (continued)
|
FELCOR LODGING LIMITED PARTNERSHIP
CONDENSED CONSOLIDATING BALANCE SHEET
September 30, 2012
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FelCor LP
|
|
Subsidiary Guarantors
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Total Consolidated
|
Net investment in hotels
|
$
|
68,183
|
|
|
$
|
809,852
|
|
|
$
|
935,810
|
|
|
$
|
—
|
|
|
$
|
1,813,845
|
|
Hotel development
|
—
|
|
|
—
|
|
|
138,749
|
|
|
—
|
|
|
138,749
|
|
Equity investment in consolidated entities
|
1,375,446
|
|
|
—
|
|
|
—
|
|
|
(1,375,446
|
)
|
|
—
|
|
Investment in unconsolidated entities
|
43,977
|
|
|
11,962
|
|
|
1,413
|
|
|
—
|
|
|
57,352
|
|
Hotels held for sale
|
—
|
|
|
113
|
|
|
40,709
|
|
|
—
|
|
|
40,822
|
|
Cash and cash equivalents
|
72,214
|
|
|
35,888
|
|
|
4,017
|
|
|
—
|
|
|
112,119
|
|
Restricted cash
|
—
|
|
|
7,158
|
|
|
74,484
|
|
|
—
|
|
|
81,642
|
|
Accounts receivable, net
|
436
|
|
|
34,004
|
|
|
282
|
|
|
—
|
|
|
34,722
|
|
Deferred expenses, net
|
16,966
|
|
|
—
|
|
|
8,396
|
|
|
—
|
|
|
25,362
|
|
Other assets
|
10,792
|
|
|
10,569
|
|
|
5,679
|
|
|
—
|
|
|
27,040
|
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
$
|
1,588,014
|
|
|
$
|
909,546
|
|
|
$
|
1,209,539
|
|
|
$
|
(1,375,446
|
)
|
|
$
|
2,331,653
|
|
|
|
|
|
|
|
|
|
|
|
Debt, net
|
$
|
992,499
|
|
|
$
|
—
|
|
|
$
|
605,595
|
|
|
$
|
—
|
|
|
$
|
1,598,094
|
|
Distributions payable
|
46,306
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
46,306
|
|
Accrued expenses and other liabilities
|
48,515
|
|
|
97,882
|
|
|
13,420
|
|
|
—
|
|
|
159,817
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities
|
1,087,320
|
|
|
97,882
|
|
|
619,015
|
|
|
—
|
|
|
1,804,217
|
|
|
|
|
|
|
|
|
|
|
|
Redeemable units
|
3,236
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,236
|
|
|
|
|
|
|
|
|
|
|
|
Preferred units
|
478,774
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
478,774
|
|
Common units
|
18,684
|
|
|
785,573
|
|
|
563,532
|
|
|
(1,375,446
|
)
|
|
(7,657
|
)
|
Accumulated other comprehensive income
|
—
|
|
|
26,341
|
|
|
—
|
|
|
—
|
|
|
26,341
|
|
Total FelCor LP partners’ capital
|
497,458
|
|
|
811,914
|
|
|
563,532
|
|
|
(1,375,446
|
)
|
|
497,458
|
|
Noncontrolling interests
|
—
|
|
|
(250
|
)
|
|
26,992
|
|
|
—
|
|
|
26,742
|
|
Total partners’ capital
|
497,458
|
|
|
811,664
|
|
|
590,524
|
|
|
(1,375,446
|
)
|
|
524,200
|
|
Total liabilities and partners’ capital
|
$
|
1,588,014
|
|
|
$
|
909,546
|
|
|
$
|
1,209,539
|
|
|
$
|
(1,375,446
|
)
|
|
$
|
2,331,653
|
|
FELCOR LODGING TRUST INCORPORATED AND FELCOR LODGING LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
12.
|
FelCor LP’s Consolidating Financial Information – (continued)
|
FELCOR LODGING LIMITED PARTNERSHIP
CONDENSED CONSOLIDATING BALANCE SHEET
December 31, 2011
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FelCor LP
|
|
Subsidiary Guarantors
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Total Consolidated
|
Net investment in hotels
|
$
|
67,828
|
|
|
$
|
805,280
|
|
|
$
|
1,080,687
|
|
|
$
|
—
|
|
|
$
|
1,953,795
|
|
Hotel development
|
—
|
|
|
—
|
|
|
120,163
|
|
|
—
|
|
|
120,163
|
|
Equity investment in consolidated entities
|
1,478,347
|
|
|
—
|
|
|
—
|
|
|
(1,478,347
|
)
|
|
—
|
|
Investment in unconsolidated entities
|
56,492
|
|
|
12,063
|
|
|
1,447
|
|
|
—
|
|
|
70,002
|
|
Cash and cash equivalents
|
23,503
|
|
|
67,001
|
|
|
3,254
|
|
|
—
|
|
|
93,758
|
|
Restricted cash
|
—
|
|
|
11,514
|
|
|
72,726
|
|
|
—
|
|
|
84,240
|
|
Accounts receivable, net
|
540
|
|
|
26,357
|
|
|
238
|
|
|
—
|
|
|
27,135
|
|
Deferred expenses, net
|
24,101
|
|
|
—
|
|
|
5,671
|
|
|
—
|
|
|
29,772
|
|
Other assets
|
8,507
|
|
|
10,817
|
|
|
5,039
|
|
|
—
|
|
|
24,363
|
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
$
|
1,659,318
|
|
|
$
|
933,032
|
|
|
$
|
1,289,225
|
|
|
$
|
(1,478,347
|
)
|
|
$
|
2,403,228
|
|
|
|
|
|
|
|
|
|
|
|
Debt, net
|
$
|
984,931
|
|
|
$
|
—
|
|
|
$
|
611,535
|
|
|
$
|
—
|
|
|
$
|
1,596,466
|
|
Distributions payable
|
76,293
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
76,293
|
|
Accrued expenses and other liabilities
|
33,530
|
|
|
98,127
|
|
|
8,891
|
|
|
—
|
|
|
140,548
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities
|
1,094,754
|
|
|
98,127
|
|
|
620,426
|
|
|
—
|
|
|
1,813,307
|
|
|
|
|
|
|
|
|
|
|
|
Redeemable units
|
3,026
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,026
|
|
|
|
|
|
|
|
|
|
|
|
Preferred units
|
478,774
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
478,774
|
|
Common units
|
82,764
|
|
|
810,554
|
|
|
641,945
|
|
|
(1,478,347
|
)
|
|
56,916
|
|
Accumulated other comprehensive income
|
—
|
|
|
25,848
|
|
|
—
|
|
|
—
|
|
|
25,848
|
|
Total FelCor LP partners’ capital
|
561,538
|
|
|
836,402
|
|
|
641,945
|
|
|
(1,478,347
|
)
|
|
561,538
|
|
Noncontrolling interests
|
—
|
|
|
(1,497
|
)
|
|
26,854
|
|
|
—
|
|
|
25,357
|
|
Total partners’ capital
|
561,538
|
|
|
834,905
|
|
|
668,799
|
|
|
(1,478,347
|
)
|
|
586,895
|
|
Total liabilities and partners’ capital
|
$
|
1,659,318
|
|
|
$
|
933,032
|
|
|
$
|
1,289,225
|
|
|
$
|
(1,478,347
|
)
|
|
$
|
2,403,228
|
|
FELCOR LODGING TRUST INCORPORATED AND FELCOR LODGING LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
12.
|
FelCor LP’s Consolidating Financial Information – (continued)
|
FELCOR LODGING LIMITED PARTNERSHIP
CONDENSED
CONSOLIDATING STATEMENT OF OPERATIONS
For the Three Months Ended
September 30, 2012
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FelCor LP
|
|
Subsidiary Guarantors
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Total Consolidated
|
Revenues:
|
|
|
|
|
|
|
|
|
|
Hotel operating revenue
|
$
|
—
|
|
|
$
|
234,796
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
234,796
|
|
Percentage lease revenue
|
2,575
|
|
|
—
|
|
|
43,556
|
|
|
(46,131
|
)
|
|
—
|
|
Other revenue
|
7
|
|
|
1,269
|
|
|
165
|
|
|
—
|
|
|
1,441
|
|
Total revenues
|
2,582
|
|
|
236,065
|
|
|
43,721
|
|
|
(46,131
|
)
|
|
236,237
|
|
|
|
|
|
|
|
|
|
|
|
Expenses:
|
|
|
|
|
|
|
|
|
|
Hotel operating expenses
|
—
|
|
|
159,398
|
|
|
—
|
|
|
—
|
|
|
159,398
|
|
Taxes, insurance and lease expense
|
319
|
|
|
65,786
|
|
|
5,379
|
|
|
(46,131
|
)
|
|
25,353
|
|
Corporate expenses
|
139
|
|
|
3,116
|
|
|
2,440
|
|
|
—
|
|
|
5,695
|
|
Depreciation and amortization
|
1,248
|
|
|
12,715
|
|
|
17,786
|
|
|
—
|
|
|
31,749
|
|
Other expenses
|
88
|
|
|
1,697
|
|
|
378
|
|
|
—
|
|
|
2,163
|
|
Total operating expenses
|
1,794
|
|
|
242,712
|
|
|
25,983
|
|
|
(46,131
|
)
|
|
224,358
|
|
Operating income
|
788
|
|
|
(6,647
|
)
|
|
17,738
|
|
|
—
|
|
|
11,879
|
|
Interest expense, net
|
(21,532
|
)
|
|
(293
|
)
|
|
(9,534
|
)
|
|
—
|
|
|
(31,359
|
)
|
Debt extinguishment
|
—
|
|
|
—
|
|
|
(11,661
|
)
|
|
—
|
|
|
(11,661
|
)
|
Loss before equity in income from unconsolidated entities
|
(20,744
|
)
|
|
(6,940
|
)
|
|
(3,457
|
)
|
|
—
|
|
|
(31,141
|
)
|
Equity in loss from consolidated entities
|
559
|
|
|
—
|
|
|
—
|
|
|
(559
|
)
|
|
—
|
|
Equity in income from unconsolidated entities
|
1,040
|
|
|
507
|
|
|
(11
|
)
|
|
—
|
|
|
1,536
|
|
Loss from continuing operations
|
(19,145
|
)
|
|
(6,433
|
)
|
|
(3,468
|
)
|
|
(559
|
)
|
|
(29,605
|
)
|
Income from discontinued operations
|
(24
|
)
|
|
(861
|
)
|
|
10,935
|
|
|
—
|
|
|
10,050
|
|
Net loss
|
(19,169
|
)
|
|
(7,294
|
)
|
|
7,467
|
|
|
(559
|
)
|
|
(19,555
|
)
|
Loss attributable to noncontrolling interests
|
—
|
|
|
286
|
|
|
100
|
|
|
—
|
|
|
386
|
|
Net loss attributable to FelCor LP
|
(19,169
|
)
|
|
(7,008
|
)
|
|
7,567
|
|
|
(559
|
)
|
|
(19,169
|
)
|
Preferred distributions
|
(9,678
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(9,678
|
)
|
Net loss attributable to FelCor LP common unitholders
|
$
|
(28,847
|
)
|
|
$
|
(7,008
|
)
|
|
$
|
7,567
|
|
|
$
|
(559
|
)
|
|
$
|
(28,847
|
)
|
FELCOR LODGING TRUST INCORPORATED AND FELCOR LODGING LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
12. FelCor LP’s Consolidating Financial Information – (continued)
FELCOR LODGING LIMITED PARTNERSHIP
CONDENSED
CONSOLIDATING STATEMENT OF OPERATIONS
For the Three Months Ended
September 30, 2011
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FelCor LP
|
|
Subsidiary Guarantors
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Total Consolidated
|
Revenues:
|
|
|
|
|
|
|
|
|
|
Hotel operating revenue
|
$
|
—
|
|
|
$
|
221,634
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
221,634
|
|
Percentage lease revenue
|
2,439
|
|
|
—
|
|
|
40,808
|
|
|
(43,247
|
)
|
|
—
|
|
Other revenue
|
—
|
|
|
1,241
|
|
|
153
|
|
|
—
|
|
|
1,394
|
|
Total revenues
|
2,439
|
|
|
222,875
|
|
|
40,961
|
|
|
(43,247
|
)
|
|
223,028
|
|
|
|
|
|
|
|
|
|
|
|
Expenses:
|
|
|
|
|
|
|
|
|
|
Hotel operating expenses
|
—
|
|
|
152,865
|
|
|
—
|
|
|
—
|
|
|
152,865
|
|
Taxes, insurance and lease expense
|
383
|
|
|
60,984
|
|
|
4,895
|
|
|
(43,247
|
)
|
|
23,015
|
|
Corporate expenses
|
139
|
|
|
3,486
|
|
|
2,633
|
|
|
—
|
|
|
6,258
|
|
Depreciation and amortization
|
1,138
|
|
|
11,534
|
|
|
17,219
|
|
|
—
|
|
|
29,891
|
|
Other expenses
|
(13
|
)
|
|
1,138
|
|
|
83
|
|
|
—
|
|
|
1,208
|
|
Total operating expenses
|
1,647
|
|
|
230,007
|
|
|
24,830
|
|
|
(43,247
|
)
|
|
213,237
|
|
Operating income
|
792
|
|
|
(7,132
|
)
|
|
16,131
|
|
|
—
|
|
|
9,791
|
|
Interest expense, net
|
(23,710
|
)
|
|
(588
|
)
|
|
(8,567
|
)
|
|
—
|
|
|
(32,865
|
)
|
Debt extinguishment
|
—
|
|
|
—
|
|
|
(21
|
)
|
|
—
|
|
|
(21
|
)
|
Gain on involuntary conversion, net
|
—
|
|
|
109
|
|
|
—
|
|
|
—
|
|
|
109
|
|
Loss before equity in income from unconsolidated entities
|
(22,918
|
)
|
|
(7,611
|
)
|
|
7,543
|
|
|
—
|
|
|
(22,986
|
)
|
Equity in income from consolidated entities
|
(751
|
)
|
|
—
|
|
|
—
|
|
|
751
|
|
|
—
|
|
Equity in income from unconsolidated entities
|
(54
|
)
|
|
315
|
|
|
(12
|
)
|
|
—
|
|
|
249
|
|
Loss from continuing operations
|
(23,723
|
)
|
|
(7,296
|
)
|
|
7,531
|
|
|
751
|
|
|
(22,737
|
)
|
Loss from discontinued operations
|
725
|
|
|
(1,481
|
)
|
|
117
|
|
|
—
|
|
|
(639
|
)
|
Net loss
|
(22,998
|
)
|
|
(8,777
|
)
|
|
7,648
|
|
|
751
|
|
|
(23,376
|
)
|
Loss attributable to noncontrolling interests
|
—
|
|
|
152
|
|
|
226
|
|
|
—
|
|
|
378
|
|
Net loss attributable to FelCor LP
|
(22,998
|
)
|
|
(8,625
|
)
|
|
7,874
|
|
|
751
|
|
|
(22,998
|
)
|
Preferred distributions
|
(9,678
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(9,678
|
)
|
Net loss attributable to FelCor LP common unitholders
|
$
|
(32,676
|
)
|
|
$
|
(8,625
|
)
|
|
$
|
7,874
|
|
|
$
|
751
|
|
|
$
|
(32,676
|
)
|
FELCOR LODGING TRUST INCORPORATED AND FELCOR LODGING LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
12.
|
FelCor LP’s Consolidating Financial Information – (continued)
|
FELCOR LODGING LIMITED PARTNERSHIP
CONDENSED
CONSOLIDATING STATEMENT OF OPERATIONS
For the
Nine
Months Ended
September 30, 2012
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FelCor LP
|
|
Subsidiary Guarantors
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Total Consolidated
|
Revenues:
|
|
|
|
|
|
|
|
|
|
Hotel operating revenue
|
$
|
—
|
|
|
$
|
692,313
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
692,313
|
|
Percentage lease revenue
|
5,401
|
|
|
—
|
|
|
124,972
|
|
|
(130,373
|
)
|
|
—
|
|
Other revenue
|
12
|
|
|
2,311
|
|
|
349
|
|
|
—
|
|
|
2,672
|
|
Total revenues
|
5,413
|
|
|
694,624
|
|
|
125,321
|
|
|
(130,373
|
)
|
|
694,985
|
|
|
|
|
|
|
|
|
|
|
|
Expenses:
|
|
|
|
|
|
|
|
|
|
Hotel operating expenses
|
—
|
|
|
471,365
|
|
|
—
|
|
|
—
|
|
|
471,365
|
|
Taxes, insurance and lease expense
|
1,065
|
|
|
185,955
|
|
|
15,336
|
|
|
(130,373
|
)
|
|
71,983
|
|
Corporate expenses
|
333
|
|
|
10,816
|
|
|
8,925
|
|
|
—
|
|
|
20,074
|
|
Depreciation and amortization
|
3,523
|
|
|
36,541
|
|
|
52,480
|
|
|
—
|
|
|
92,544
|
|
Impairment loss
|
—
|
|
|
—
|
|
|
1,335
|
|
|
—
|
|
|
1,335
|
|
Other expenses
|
564
|
|
|
2,877
|
|
|
485
|
|
|
—
|
|
|
3,926
|
|
Total operating expenses
|
5,485
|
|
|
707,554
|
|
|
78,561
|
|
|
(130,373
|
)
|
|
661,227
|
|
Operating income
|
(72
|
)
|
|
(12,930
|
)
|
|
46,760
|
|
|
—
|
|
|
33,758
|
|
Interest expense, net
|
(63,906
|
)
|
|
(921
|
)
|
|
(28,720
|
)
|
|
—
|
|
|
(93,547
|
)
|
Debt extinguishment
|
(7
|
)
|
|
—
|
|
|
(11,801
|
)
|
|
—
|
|
|
(11,808
|
)
|
Loss before equity in income from unconsolidated entities
|
(63,985
|
)
|
|
(13,851
|
)
|
|
6,239
|
|
|
—
|
|
|
(71,597
|
)
|
Equity in loss from consolidated entities
|
26,048
|
|
|
—
|
|
|
—
|
|
|
(26,048
|
)
|
|
—
|
|
Equity in income from unconsolidated entities
|
2,058
|
|
|
650
|
|
|
(34
|
)
|
|
—
|
|
|
2,674
|
|
Loss from continuing operations
|
(35,879
|
)
|
|
(13,201
|
)
|
|
6,205
|
|
|
(26,048
|
)
|
|
(68,923
|
)
|
Income from discontinued operations
|
(69
|
)
|
|
9,065
|
|
|
23,539
|
|
|
—
|
|
|
32,535
|
|
Net loss
|
(35,948
|
)
|
|
(4,136
|
)
|
|
29,744
|
|
|
(26,048
|
)
|
|
(36,388
|
)
|
Loss attributable to noncontrolling interests
|
—
|
|
|
575
|
|
|
(135
|
)
|
|
—
|
|
|
440
|
|
Net loss attributable to FelCor LP
|
(35,948
|
)
|
|
(3,561
|
)
|
|
29,609
|
|
|
(26,048
|
)
|
|
(35,948
|
)
|
Preferred distributions
|
(29,034
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(29,034
|
)
|
Net loss attributable to FelCor LP common unitholders
|
$
|
(64,982
|
)
|
|
$
|
(3,561
|
)
|
|
$
|
29,609
|
|
|
$
|
(26,048
|
)
|
|
$
|
(64,982
|
)
|
FELCOR LODGING TRUST INCORPORATED AND FELCOR LODGING LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
12.
|
FelCor LP’s Consolidating Financial Information – (continued)
|
FELCOR LODGING LIMITED PARTNERSHIP
CONDENSED
CONSOLIDATING STATEMENT OF OPERATIONS
For the
Nine
Months Ended
September 30, 2011
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FelCor LP
|
|
Subsidiary Guarantors
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Total Consolidated
|
Revenues:
|
|
|
|
|
|
|
|
|
|
Hotel operating revenue
|
$
|
—
|
|
|
$
|
650,068
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
650,068
|
|
Percentage lease revenue
|
5,315
|
|
|
—
|
|
|
119,145
|
|
|
(124,460
|
)
|
|
—
|
|
Other revenue
|
10
|
|
|
2,332
|
|
|
288
|
|
|
—
|
|
|
2,630
|
|
Total revenues
|
5,325
|
|
|
652,400
|
|
|
119,433
|
|
|
(124,460
|
)
|
|
652,698
|
|
|
|
|
|
|
|
|
|
|
|
Expenses:
|
|
|
|
|
|
|
|
|
|
Hotel operating expenses
|
—
|
|
|
445,436
|
|
|
—
|
|
|
—
|
|
|
445,436
|
|
Taxes, insurance and lease expense
|
1,199
|
|
|
172,858
|
|
|
14,634
|
|
|
(124,460
|
)
|
|
64,231
|
|
Corporate expenses
|
434
|
|
|
12,436
|
|
|
9,835
|
|
|
—
|
|
|
22,705
|
|
Depreciation and amortization
|
3,456
|
|
|
33,834
|
|
|
51,670
|
|
|
—
|
|
|
88,960
|
|
Impairment loss
|
—
|
|
|
4,315
|
|
|
2,688
|
|
|
—
|
|
|
7,003
|
|
Other expenses
|
11
|
|
|
3,261
|
|
|
183
|
|
|
—
|
|
|
3,455
|
|
Total operating expenses
|
5,100
|
|
|
672,140
|
|
|
79,010
|
|
|
(124,460
|
)
|
|
631,790
|
|
Operating income
|
225
|
|
|
(19,740
|
)
|
|
40,423
|
|
|
—
|
|
|
20,908
|
|
Interest expense, net
|
(67,637
|
)
|
|
(1,881
|
)
|
|
(28,654
|
)
|
|
—
|
|
|
(98,172
|
)
|
Debt extinguishment
|
(27,354
|
)
|
|
—
|
|
|
(245
|
)
|
|
—
|
|
|
(27,599
|
)
|
Gain on involuntary conversion, net
|
(21
|
)
|
|
316
|
|
|
(3
|
)
|
|
—
|
|
|
292
|
|
Loss before equity in loss from unconsolidated entities
|
(94,787
|
)
|
|
(21,305
|
)
|
|
11,521
|
|
|
—
|
|
|
(104,571
|
)
|
Equity in income from consolidated entities
|
(2,010
|
)
|
|
—
|
|
|
—
|
|
|
2,010
|
|
|
—
|
|
Equity in loss from unconsolidated entities
|
(1,319
|
)
|
|
50
|
|
|
(34
|
)
|
|
—
|
|
|
(1,303
|
)
|
Loss from continuing operations
|
(98,116
|
)
|
|
(21,255
|
)
|
|
11,487
|
|
|
2,010
|
|
|
(105,874
|
)
|
Income from discontinued operations
|
886
|
|
|
(7,120
|
)
|
|
14,609
|
|
|
—
|
|
|
8,375
|
|
Net loss
|
(97,230
|
)
|
|
(28,375
|
)
|
|
26,096
|
|
|
2,010
|
|
|
(97,499
|
)
|
Loss attributable to noncontrolling interests
|
—
|
|
|
305
|
|
|
(36
|
)
|
|
—
|
|
|
269
|
|
Net loss attributable to FelCor LP
|
(97,230
|
)
|
|
(28,070
|
)
|
|
26,060
|
|
|
2,010
|
|
|
(97,230
|
)
|
Preferred distributions
|
(29,034
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(29,034
|
)
|
Net loss attributable to FelCor LP common unitholders
|
$
|
(126,264
|
)
|
|
$
|
(28,070
|
)
|
|
$
|
26,060
|
|
|
$
|
2,010
|
|
|
$
|
(126,264
|
)
|
FELCOR LODGING TRUST INCORPORATED AND FELCOR LODGING LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
12.
|
FelCor LP’s Consolidating Financial Information – (continued)
|
FELCOR LODGING LIMITED PARTNERSHIP
CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE LOSS
For the
Three
Months Ended
September 30, 2012
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FelCor LP
|
|
Subsidiary Guarantors
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Total Consolidated
|
Net loss
|
$
|
(19,169
|
)
|
|
$
|
(7,294
|
)
|
|
$
|
7,467
|
|
|
$
|
(559
|
)
|
|
$
|
(19,555
|
)
|
Foreign currency translation adjustment
|
—
|
|
|
502
|
|
|
—
|
|
|
—
|
|
|
502
|
|
Comprehensive loss
|
(19,169
|
)
|
|
(6,792
|
)
|
|
7,467
|
|
|
(559
|
)
|
|
(19,053
|
)
|
Comprehensive loss attributable to noncontrolling interests
|
—
|
|
|
286
|
|
|
100
|
|
|
—
|
|
|
386
|
|
Comprehensive loss attributable to FelCor LP
|
$
|
(19,169
|
)
|
|
$
|
(6,506
|
)
|
|
$
|
7,567
|
|
|
$
|
(559
|
)
|
|
$
|
(18,667
|
)
|
FELCOR LODGING LIMITED PARTNERSHIP
CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE LOSS
For the
Three
Months Ended
September 30, 2011
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FelCor LP
|
|
Subsidiary Guarantors
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Total Consolidated
|
Net loss
|
$
|
(22,998
|
)
|
|
$
|
(8,777
|
)
|
|
$
|
7,648
|
|
|
$
|
751
|
|
|
$
|
(23,376
|
)
|
Foreign currency translation adjustment
|
—
|
|
|
(3,535
|
)
|
|
—
|
|
|
—
|
|
|
(3,535
|
)
|
Comprehensive loss
|
(22,998
|
)
|
|
(12,312
|
)
|
|
7,648
|
|
|
751
|
|
|
(26,911
|
)
|
Comprehensive loss attributable to noncontrolling interests
|
—
|
|
|
152
|
|
|
226
|
|
|
—
|
|
|
378
|
|
Comprehensive loss attributable to FelCor LP
|
$
|
(22,998
|
)
|
|
$
|
(12,160
|
)
|
|
$
|
7,874
|
|
|
$
|
751
|
|
|
$
|
(26,533
|
)
|
FELCOR LODGING TRUST INCORPORATED AND FELCOR LODGING LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
12.
|
FelCor LP’s Consolidating Financial Information – (continued)
|
FELCOR LODGING LIMITED PARTNERSHIP
CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE LOSS
For the
Nine
Months Ended
September 30, 2012
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FelCor LP
|
|
Subsidiary Guarantors
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Total Consolidated
|
Net loss
|
$
|
(35,948
|
)
|
|
$
|
(4,136
|
)
|
|
$
|
29,744
|
|
|
$
|
(26,048
|
)
|
|
$
|
(36,388
|
)
|
Foreign currency translation adjustment
|
—
|
|
|
493
|
|
|
—
|
|
|
—
|
|
|
493
|
|
Comprehensive loss
|
(35,948
|
)
|
|
(3,643
|
)
|
|
29,744
|
|
|
(26,048
|
)
|
|
(35,895
|
)
|
Comprehensive loss attributable to noncontrolling interests
|
—
|
|
|
575
|
|
|
(135
|
)
|
|
—
|
|
|
440
|
|
Comprehensive loss attributable to FelCor LP
|
$
|
(35,948
|
)
|
|
$
|
(3,068
|
)
|
|
$
|
29,609
|
|
|
$
|
(26,048
|
)
|
|
$
|
(35,455
|
)
|
FELCOR LODGING LIMITED PARTNERSHIP
CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE LOSS
For the
Nine
Months Ended
September 30, 2011
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FelCor LP
|
|
Subsidiary Guarantors
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Total Consolidated
|
Net loss
|
$
|
(97,230
|
)
|
|
$
|
(28,375
|
)
|
|
$
|
26,096
|
|
|
$
|
2,010
|
|
|
$
|
(97,499
|
)
|
Foreign currency translation adjustment
|
—
|
|
|
(2,057
|
)
|
|
—
|
|
|
—
|
|
|
(2,057
|
)
|
Comprehensive loss
|
(97,230
|
)
|
|
(30,432
|
)
|
|
26,096
|
|
|
2,010
|
|
|
(99,556
|
)
|
Comprehensive loss attributable to noncontrolling interests
|
—
|
|
|
305
|
|
|
(36
|
)
|
|
—
|
|
|
269
|
|
Comprehensive loss attributable to FelCor LP
|
$
|
(97,230
|
)
|
|
$
|
(30,127
|
)
|
|
$
|
26,060
|
|
|
$
|
2,010
|
|
|
$
|
(99,287
|
)
|
FELCOR LODGING TRUST INCORPORATED AND FELCOR LODGING LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
12.
|
FelCor LP’s Consolidating Financial Information – (continued)
|
FELCOR LODGING LIMITED PARTNERSHIP
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
For the
Nine
Months Ended
September 30, 2012
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FelCor LP
|
|
Subsidiary Guarantors
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Total Consolidated
|
Operating activities:
|
|
|
|
|
|
|
|
|
|
Cash flows from operating activities
|
$
|
(36,423
|
)
|
|
$
|
13,966
|
|
|
$
|
95,264
|
|
|
$
|
—
|
|
|
$
|
72,807
|
|
Investing activities:
|
|
|
|
|
|
|
|
|
|
Improvements and additions to hotels
|
(6,875
|
)
|
|
(58,989
|
)
|
|
(34,121
|
)
|
|
—
|
|
|
(99,985
|
)
|
Hotel development
|
—
|
|
|
—
|
|
|
(16,707
|
)
|
|
—
|
|
|
(16,707
|
)
|
Proceeds from asset dispositions
|
(14
|
)
|
|
22,750
|
|
|
101,874
|
|
|
—
|
|
|
124,610
|
|
Distributions from unconsolidated entities
|
11,894
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11,894
|
|
Intercompany financing
|
139,246
|
|
|
—
|
|
|
—
|
|
|
(139,246
|
)
|
|
—
|
|
Other
|
—
|
|
|
4,003
|
|
|
(1,405
|
)
|
|
—
|
|
|
2,598
|
|
Cash flows from investing activities
|
144,251
|
|
|
(32,236
|
)
|
|
49,641
|
|
|
(139,246
|
)
|
|
22,410
|
|
Financing activities:
|
|
|
|
|
|
|
|
|
|
Proceeds from borrowings
|
—
|
|
|
—
|
|
|
378,750
|
|
|
—
|
|
|
378,750
|
|
Repayment of borrowings
|
(96
|
)
|
|
—
|
|
|
(395,259
|
)
|
|
—
|
|
|
(395,355
|
)
|
Distributions paid to preferred unitholders
|
(59,021
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(59,021
|
)
|
Intercompany financing
|
—
|
|
|
(12,955
|
)
|
|
(126,291
|
)
|
|
139,246
|
|
|
—
|
|
Other
|
—
|
|
|
—
|
|
|
(1,342
|
)
|
|
—
|
|
|
(1,342
|
)
|
Cash flows from financing activities
|
(59,117
|
)
|
|
(12,955
|
)
|
|
(144,142
|
)
|
|
139,246
|
|
|
(76,968
|
)
|
Effect of exchange rate changes on cash
|
—
|
|
|
112
|
|
|
—
|
|
|
—
|
|
|
112
|
|
Change in cash and cash equivalents
|
48,711
|
|
|
(31,113
|
)
|
|
763
|
|
|
—
|
|
|
18,361
|
|
Cash and cash equivalents at beginning of period
|
23,503
|
|
|
67,001
|
|
|
3,254
|
|
|
—
|
|
|
93,758
|
|
Cash and cash equivalents at end of period
|
$
|
72,214
|
|
|
$
|
35,888
|
|
|
$
|
4,017
|
|
|
$
|
—
|
|
|
$
|
112,119
|
|
FELCOR LODGING TRUST INCORPORATED AND FELCOR LODGING LIMITED PARTNERSHIP
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
12.
|
FelCor LP’s Consolidating Financial Information – (continued)
|
FELCOR LODGING LIMITED PARTNERSHIP
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
For the
Nine
Months Ended
September 30, 2011
(in thousands
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FelCor LP
|
|
Subsidiary Guarantors
|
|
Non-Guarantor Subsidiaries
|
|
Eliminations
|
|
Total Consolidated
|
Operating activities:
|
|
|
|
|
|
|
|
|
|
Cash flows from operating activities
|
$
|
(65,797
|
)
|
|
$
|
10,612
|
|
|
$
|
91,616
|
|
|
$
|
—
|
|
|
$
|
36,431
|
|
Investing activities:
|
|
|
|
|
|
|
|
|
|
Acquisition of hotels
|
—
|
|
|
(137,985
|
)
|
|
—
|
|
|
—
|
|
|
(137,985
|
)
|
Improvements and additions to hotels
|
(2,228
|
)
|
|
(22,699
|
)
|
|
(32,543
|
)
|
|
—
|
|
|
(57,470
|
)
|
Proceeds from asset dispositions
|
14,132
|
|
|
(76
|
)
|
|
82,379
|
|
|
—
|
|
|
96,435
|
|
Change in restricted cash - investing
|
—
|
|
|
(1,675
|
)
|
|
(114,583
|
)
|
|
—
|
|
|
(116,258
|
)
|
Intercompany financing
|
(445,364
|
)
|
|
—
|
|
|
—
|
|
|
445,364
|
|
|
—
|
|
Other
|
1,386
|
|
|
391
|
|
|
(359
|
)
|
|
—
|
|
|
1,418
|
|
Cash flows from investing activities
|
(432,074
|
)
|
|
(162,044
|
)
|
|
(65,106
|
)
|
|
445,364
|
|
|
(213,860
|
)
|
Financing activities:
|
|
|
|
|
|
|
|
|
|
Proceeds from borrowings
|
525,000
|
|
|
—
|
|
|
562,285
|
|
|
—
|
|
|
1,087,285
|
|
Repayment of borrowings
|
(233,761
|
)
|
|
—
|
|
|
(878,653
|
)
|
|
—
|
|
|
(1,112,414
|
)
|
Payment of deferred financing fees
|
(14,017
|
)
|
|
—
|
|
|
(4,780
|
)
|
|
—
|
|
|
(18,797
|
)
|
Distributions paid to preferred unitholders
|
(29,035
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(29,035
|
)
|
Net proceeds from common unit issuance
|
158,476
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
158,476
|
|
Contributions from noncontrolling interests
|
—
|
|
|
—
|
|
|
6,646
|
|
|
—
|
|
|
6,646
|
|
Intercompany financing
|
—
|
|
|
155,807
|
|
|
289,557
|
|
|
(445,364
|
)
|
|
—
|
|
Other
|
2,500
|
|
|
—
|
|
|
(868
|
)
|
|
—
|
|
|
1,632
|
|
Cash flows from financing activities
|
409,163
|
|
|
155,807
|
|
|
(25,813
|
)
|
|
(445,364
|
)
|
|
93,793
|
|
Effect of exchange rate changes on cash
|
—
|
|
|
(153
|
)
|
|
—
|
|
|
—
|
|
|
(153
|
)
|
Change in cash and cash equivalents
|
(88,708
|
)
|
|
4,222
|
|
|
697
|
|
|
—
|
|
|
(83,789
|
)
|
Cash and cash equivalents at beginning of period
|
155,350
|
|
|
43,647
|
|
|
1,975
|
|
|
—
|
|
|
200,972
|
|
Cash and cash equivalents at end of period
|
$
|
66,642
|
|
|
$
|
47,869
|
|
|
$
|
2,672
|
|
|
$
|
—
|
|
|
$
|
117,183
|
|