Service Properties Trust - Shares Of Beneficial Interest · NASDAQ:SVC
Service Properties Trust - Shares Of Beneficial Interest — Service Properties Trust — Investor Presentation (March 2025)
34 slides from Service Properties Trust - Shares Of Beneficial Interest's investor presentation, Mar 12, 2025
Slide 1: Investor Presentation March 2025
Investor Presentation March 2025 | Nasdaq: SVC Exhibit 99.1
Slide 2: Warning Concerning Forward-Looking Statements, Disclaimers and Non-GAAP Financial Measures
Warning Concerning Forward-Looking Statements, Disclaimers and Non-GAAP Financial Measures The contents of this presentation are not to be construed as legal, regulatory, business, accounting or tax advice. You should consult your own attorney, business advisor, accountant and tax advisor as to lega
Slide 3: Investment Highlights
Investment Highlights Diversified net lease necessity-based retail and hotel portfolio with national scale creates resilience through market cycles. Capex investment in hotel portfolio to improve asset quality, market share and operating performance. Strong financial position with no near-term debt
Slide 4: SVC: At a Glance
Hotel Portfolio Service-Focused Retail Net Lease Portfolio SVC: At a Glance SVC is a publicly traded REIT primarily invested in two asset categories, hotels and service-focused retail net lease properties, significantly diversifying its cash flows. 206 Properties 742 Properties Total Company 4 948 P
Slide 5: Recent Company Highlights
Recent Company Highlights 5 • Grew comparable Hotel RevPAR 4.2% versus Q4 2023, or 6.8% excluding 14 renovation hotels, marking the strongest growth in the past seven quarters. • Sold eight hotels with a total of 1,004 keys and three net lease properties with 9,992 square feet for an aggregate sales
Slide 6: Hotel Portfolio
Hotel Portfolio 66
Slide 7: Hotel Portfolio: At a Glance
Hotel Portfolio: At a Glance 1. Based on hotel percentage of investments. 2. Based on number of keys. 3. Based on room revenue. 58% 26% 16% Full Service Extended Stay Select Service 48% 36% 16% Upscale Upper Midscale/Midscale Upper Upscale Chain Scale(2) 47% 25% 19% 8% 1% Suburban Urban Airport Reso
Slide 8: Hotel Portfolio: Comparable Property Operating Metrics
66.4% 57.7% 49.9% 50.5% 56.6% 63.1% 66.1% 68.8% 71.2% 69.3% 66.9% 66.0% 68.9% 60.9% 52.9% $148 $135 $132 $139 $141 $146 $143 $145 $148 $145 $139 $142 $148 $134 $131 $99 $78 $66 $70 $80 $92 $94 $100 $106 $100 $93 $94 $102 $81 $69 $0 $50 $100 $150 $200 $250 0% 10% 20% 30% 40% 50% 60% 70% 80% Oct '23 N
Slide 9: Hotel Portfolio: 2025 Repositioning Strategy
Hotel Portfolio: 2025 Repositioning Strategy 123 Total Hotels Marketed For Sale ~$1.1 Billion Estimated Proceeds ~17.2x Implied Adjusted EBITDA Multiple Repositioning Thesis • Rebalancing hotel portfolio to include a shift towards full-service urban and leisure-oriented properties with embedded upsi
Slide 10: Recent Performance of Retained & Exit Hotels
Recent Performance of Retained & Exit Hotels 10 Three Months Ended LTM as of Hotels Keys March 31, 2024 June 30, 2024 September 30, 2024 December 31, 2024 December 31, 2024 Total Retained Hotels 83 19,445 Occupancy 55.1% 68.2% 66.4% 60.3% 62.5% ADR $172.27 $176.01 $171.51 $167.07 $171.82 RevPar $94.
Slide 11: Hotel Portfolio: Sonesta at a Glance
Hotel Portfolio: Sonesta at a Glance • 8th largest hotel company in the U.S. according to Smith Travel Research. • More than 1,100 hotels totaling over 95,000 rooms across 13 brands. • Approximately 1,000 hotels franchised. • SVC owns 34% of Sonesta. • SVC’s equity investment in Sonesta has a carryi
Slide 12: Hotel Renovations: Recent Completions
12 • Completion: Jan. 2025 • Total Project Cost: $90.0M • Comprehensive renovations to interior and exterior spaces, including public areas and guestrooms, to provide an elevated, spacious, and self- sufficient stay experience. Hotel Renovations: Recent Completions Hyatt Place Portfolio (17 Hotels)
Slide 13: Hotel Renovations: Recent Completions
13 Hotel Renovations: Recent Completions • Completion: Aug. 2024 • Total Project Cost: $12.0M • Upgraded guestrooms and outlets, enhanced meeting space and lobby. • Added new executive club lounge, a ski closet and new coffee outlet. Radisson Salt Lake City, UT Sonesta Simply Suites Miami Airport Do
Slide 14: Hotel Renovation Case Study: Radisson Hotel, Salt Lake City, UT
Hotel Renovation Case Study: Radisson Hotel, Salt Lake City, UT 14 $12 million renovation completed in August 2024. Renovation Scope • Completed upgrades to 381 guestrooms. • Revitalized lobby, enhanced outlets and upgraded meeting space with modern technology. • New Executive Club lounge and coffee
Slide 15: Hotel Renovation Case Study: Sonesta Simply Suites, Jersey City, NJ
Hotel Renovation Case Study: Sonesta Simply Suites, Jersey City, NJ 15 $6.7 million renovation completed in September 2023. Renovation Scope • Restoration of guestrooms to create a refined and restful haven for every guest. • Transformation of lobby and public spaces to redefine elegance and charm.
Slide 16: Net Lease Portfolio
Net Lease Portfolio 16
Slide 17: Net Lease Portfolio: High-Quality Service & Necessity Based Assets
Net Lease Portfolio: High-Quality Service & Necessity Based Assets 742 $381M Properties Annualized Minimum Rent 13.3M 8.0 years Rentable Square Feet Weighted Average Lease Term 97.6% 2.10x Occupancy Rent Coverage % of Annual Minimum Rent<1% >9.0% Diverse Geographical Footprint(1) 17 Net Lease Portfo
Slide 18: Net Lease Portfolio: TravelCenters of America and Retail
• Represents 68% of SVC’s net lease minimum rents. • 175 travel centers operate under two brands. • Difficult to replicate real estate located near exits along the U.S. Interstate Highway System. • Five master leases that run through 2033 and include 50 years of extension options. • Rents are guaran
Slide 19: Net Lease Portfolio: Reliable Income Stream and Low Capex Requirements
Net Lease Portfolio: Reliable Income Stream and Low Capex Requirements 1. By annualized minimum rent. Well-Laddered Lease Expirations (1) ~97% of Leases Have Contractual Increases or Percentage Rent Lease Structures $381M 2.2% 3.0% 3.3% 2.7% 2.9% 1.4% 1.3% 0.8% 82.4% 2025 2026 2027 2028 2029 2030 20
Slide 20: Net Lease Portfolio: Diversified Tenants & Industries Mitigate Risk
Net Lease Portfolio: Diversified Tenants & Industries Mitigate Risk Top Ten Tenants by BrandTenants by Industry (1) Travel Centers, 68.9% Restaurants - Quick Service, 5.1% Restaurants - Casual Dining, 3.2% Health and Fitness, 3.0% Home Goods and Leisure, 2.8% Grocery Stores, 2.4% Movie Theaters, 2.2
Slide 21: Financial Information
Financial Information 21
Slide 22: Balance Sheet Overview
Secured Fixed Rate Debt 24% Secured Floating Rate Debt 2% Unsecured Fixed Rate Debt 61% Shareholders' Equity 13% Balance Sheet Overview $2 $800 $850 $400 $1,125 $400 $500 $150 $2 $2 $601 $1,000 $0 $200 $400 $600 $800 $1,000 $1,200 2025 2026 2027 2028 2029 2030 2031 2032 $ (M ill io n s) Unsecured Fi
Slide 23: Financing Strategy
Financing Strategy 23 • SVC plans to reduce leverage and capital expenditures through hotel sales program in 2025. • Plan to sell 123 hotels (16,426 keys) in 2025 for estimated sales proceeds of approximately $1.1 billion. • Proceeds from asset sales are expected to address all 2026 maturities. • Pr
Slide 24: Appendix
Appendix 24
Slide 25: RMR Platform
Over $40 Billion in AUM RMR Platform Approximately 2,000 Properties More than 35 Offices Nationwide National Multi-Sector Investment Platform Industrial Residential Senior Living Medical Office Life Science Hotels Retail Office Over 1,000 Real Estate Professionals Institutional Infrastructure & Vert
Slide 26: Fees that SVC Pays to RMR are Primarily Performance Based
Fees that SVC Pays to RMR are Primarily Performance Based which Aligns Interests with Shareholders RMR base management fee tied to SVC’s share price performance. • Consists of an annual fee equal to generally 50 bps multiplied by the lower of: (1) SVC’s historical cost of real estate, or (2) SVC’s t
Slide 27: Calculation of FFO, Normalized FFO and CAD
Calculation of FFO, Normalized FFO and CAD See accompanying notes on page 30. 27 (5) (6) (3) (4)
Slide 28: Calculation of EBITDA, EBITDAre and Adjusted EBITDAre
Calculation of EBITDA, EBITDAre and Adjusted EBITDAre 28See accompanying notes on page 30. (4) (5) (6) (3)
Slide 29: Calculation and Reconciliation of Hotel EBITDA and Adjusted Hotel EBITDA
Calculation and Reconciliation of Hotel EBITDA and Adjusted Hotel EBITDA – All Hotels* 29* Results of all hotels as owned during the periods presented, including the results of hotels sold by SVC for the periods owned by SVC. See accompanying notes on page 30. (3) (3) (2) (7)
Slide 30: Notes to Calculations of FFO, EBITDA and Hotel EBITDA
Notes to Calculations of FFO, Normalized FFO, CAD, EBITDA, EBITDAre, Adjusted EBITDAre, Hotel EBITDA and Adjusted Hotel EBITDA 1. As of December 31, 2024, SVC owned 206 hotels. SVC's consolidated statements of income (loss) include hotel operating revenues and expenses of its managed hotels. 2. When
Slide 31: Non-GAAP Financial Measures and Certain Definitions
Non-GAAP Financial Measures and Certain Definitions 31 Non-GAAP Financial Measures SVC presents certain “non-GAAP financial measures” within the meaning of the applicable SEC rules, including FFO, Normalized FFO, CAD, EBITDA, Hotel EBITDA, Adjusted Hotel EBITDA, EBITDAre and Adjusted EBITDAre. These
Slide 32: Non-GAAP Financial Measures and Certain Definitions (Continued)
Non-GAAP Financial Measures and Certain Definitions (Continued) 32 Other Definitions Annualized Minimum Rent: Generally, SVC's lease agreements with its net lease tenants require payment of minimum rent to SVC. Certain of these minimum rent payment amounts are secured by full or limited guarantees.
Slide 33: Non-GAAP Financial Measures and Certain Definitions (Continued)
Non-GAAP Financial Measures and Certain Definitions (Continued) 33 Occupancy: Occupancy represents the total number of room nights sold divided by the total number of room nights available at a hotel or group of hotels, and represents occupied properties as of the end of the period shown for net lea
Slide 34: | Two Newton Place Washington Street, Suite Newton, MA 02458 SVCREIT.COM 34
Investor Presentation March 2025 | Nasdaq: SVC Two Newton Place 255 Washington Street, Suite 300 Newton, MA 02458 SVCREIT.COM 34
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