Ashford Hospitality Trust Inc · NYSE:AHT
Ashford Hospitality Trust — Investor Presentation (November 2017)
27 slides from Ashford Hospitality Trust's investor presentation, Nov 9, 2017
Slide 1: November 2017
November 2017
Slide 2: Forward Looking Statements and Non-GAAP Measures
Forward Looking Statements and Non-GAAP Measures 2 In keeping with the SEC's "Safe Harbor" guidelines, certain statements made during this presentation could be considered forward-looking and subject to certain risks and uncertainties that could cause results to differ materially from those projecte
Slide 3: Management Team
Management Team 3 33 years of real estate & hospitality experience 15 years with Ashford 10 years with Goldman Sachs Stanford BA, MBA DOUGLAS A. KESSLER Chief Executive Officer & President 17 years of hospitality experience 14 years with Ashford 3 years with ClubCorp CFA charterholde
Slide 4: Portfolio Overview
Upscale 33% Upper-Upscale 55% Luxury 5% Upper-Midscale 3% Indep. 4% Marriott 31% Hilton 6% Hyatt 3% Remington 59% Interstate <1% Top 25 73% Top 50 19% Other 8% Portfolio Overview 4 (1) As of September 30, 2017 (2) TTM as of September 30, 2017 for the 120 owned hotels as of October 27, 2017 (3) Hotel
Slide 5: Geographically Diverse
5 <1% Geographically Diverse Washington D.C. – 9.8% Los Angeles – 7.3% San Francisco – 7.5% New York – 6.5% Boston – 5.7% Nashville – 5.8% Atlanta – 5.5% Dallas / Ft. Worth – 5.4% Minneapolis – 3.4% Tampa – 2.5% Houston – 2.5% Miami – 2.4% Orlando – 2.2% San Diego – 1.6% Philadelphia – 1.7% Portland
Slide 6: High Quality
High Quality 6 Crowne Plaza La Concha Key West, FL W Atlanta Downtown Atlanta, GA Marriott Beverly HIlls Beverly Hills, CA Le Pavillon New Orleans, LA One Ocean Jacksonville, FL Le Meridien Minneapolis Minneapolis, MN W Minneapolis Minneapolis, MN The Silversmith Chicago, IL Hyatt Coral Gables Coral
Slide 7: Overview
Overview 7 Opportunistic platform focused on upper upscale, full-service hotels Highest insider ownership Disciplined capital management Aligned advisory structure Targets debt levels of 55-60% net debt/gross assets Attractive dividend yield Targets cash level of 25-30% of total equity market cap Su
Slide 8: Full-Service Rationale
Full-Service Rationale 8 170 BPS ATTRACTIVE SUPPLY FUNDAMENTALS 1.4% 2.0% 3.1% 3.5% 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0% 10-YR 2018E Upper-Upscale Other Chainscales LOWER 150 BPS LOWER FAVORABLE ACQUISITION YIELDS 6.5% Low End 8.5% High End Management Estimates VALUE-ADD OPPORTUNITIES 39% Fr
Slide 9: Disciplined Capital Management
$218 $170 $305 $574 $72 $90 $147 $89 $112 $18 $97 $81 $45 $52 $68 $65 $400 $76 $112 $17 $275 $95 $200 $10 $11 $73 $116 $90 $0 $200 $400 $600 $800 $1,000 $1,200 $1,400 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 M ill io n s Common Raises Common Buybacks Preferred Raise
Slide 10: Leverage Target
42.4% 56.1% 49.2% 56.4% 55.5% 59.6% 55.7% 58.7% 58.5% 59.1% 58.3% 64.9% 61.2% 60.9% 20.0% 25.0% 30.0% 35.0% 40.0% 45.0% 50.0% 55.0% 60.0% 65.0% 70.0% $0 $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Q3 17 M ill io n s Gross Assets Net Debt
Slide 11: Cash Target
9% 10% 9% 28% 75% 28% 22% 25% 25% 25% 28% 40% 48% 0% 10% 20% 30% 40% 50% 60% 70% 80% $0 $200 $400 $600 $800 $1,000 $1,200 $1,400 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 M ill io n s Avg Cash Avg Equity Market Cap Cash / Equity Market Cap Cash Target 11 (1) YTD September 2017
Slide 12: Highest Insider Ownership
19.1% 15.8% 7.6% 6.1% 3.6% 3.3% 2.5% 2.3% 2.0% 1.7% 1.6% 1.1% 0.8% 0.5% 0.4% 0.3% 0.00% 2.00% 4.00% 6.00% 8.00% 10.00% 12.00% 14.00% 16.00% 18.00% 20.00% AHT AHP HT APLE CLDT REIT Avg CHSP RLJ PEB INN HST DRH SHO XHR LHO PK Highest Insider Ownership 12 REIT average includes: AHP, HT, APLE, CLDT, CHS
Slide 13: Advisory Agreement Structure
Advisory Agreement Structure 13 (1) Amended Advisory Agreement in June 2015 ADVISOR MANAGED REIT Fees Provide asset management, advisory services & key money SUMMARY TERMS(1) BASE FEE INCENTIVE FEE INCENTIVE FEE PAYMENT OTHER FEES TERM EXTENSIONS • 70 bps of Total Market Capitalization (TMC) • Payab
Slide 14: Attractive Dividend Yield
6.9% 6.5% 6.5% 6.4% 6.3% 6.1% 6.1% 6.0% 5.8% 5.5% 5.1% 4.6% 4.3% 4.2% 4.1% 4.1% 4.0% 4.5% 5.0% 5.5% 6.0% 6.5% 7.0% 7.5% AHT AHP HT LHO APLE CLDT RLJ PK CHSP REIT Avg XHR DRH PEB INN HST SHO Attractive Dividend Yield 14 Source: Company filings and market data (1) As of 10/27/2017 (2) Annualized based
Slide 15: Superior Total Shareholder Returns
152% -5% 22% 208% 98% 47% 86% 56% 27% -8% 22% 1% 202% 82% 191% 1,497% 296% 90% 120% 59% 29% -8% 33% -5% -100% 0% 100% 200% 300% 400% 500% 600% 700% 800% 900% Inception 10-Yr 9-Yr 8-Yr 7-Yr 6-Yr 5-Yr 4-Yr 3-Yr 2-Yr 1-Yr YTD 2017 Peer Avg AHT Superior Total Shareholder Returns 15 (1) Since IPO on Augu
Slide 16: Value Creation Through Active Asset Management
Value Creation Through Active Asset Management 16 55.8% 52.0% 40.5% 47.4% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 2016 3-Yr Avg AHT Peer Avg PORTFOLIO HOTEL EBITDA FLOW-THROUGH *Peers include DRH, HST, INN, LHO, CHSP, HT, SHO, RLJ, FCH Note: Pro forma Hotel EBITDA flow-through information not avail
Slide 17: Competitive Advantage – Affiliated Manager
52% 58% 59% 42% 46% 47% 63% 30% 22% 53% 60% 59% 68% 70% 47% 56% 44% 28% -200% -175% -150% -125% -100% -75% -50% -25% 0% 25% 50% 75% 100% 2008 2009 2010 2011 2012 2013 2014 2015 2016 YTD Q3 2017 Non-Remington Remington Competitive Advantage – Affiliated Manager 17 Affiliated property manager benefi
Slide 18: Valuation Opportunity
Valuation Opportunity 18 (1) Based on average from 2014 to YTD June 2017 (2) Peer s include: RLJ, DRH, HST, SHO, LHO, CLDT, HT, INN, CHSP PRICE / 2018E AFFO / SHARE MULTIPLE(3),(4) TTM CAP RATE(3) TEV / 2018E EBITDA MULTIPLE(3),(4) Discount to average peer trading cap rate (bps) VALUATION OPPORTUNIT
Slide 19: Case Study – Aggressive Asset Management
Case Study – Aggressive Asset Management 19 Acquired the W Atlanta Downtown in July 2015 237 keys, 9,000 sq. ft. of meeting space Close proximity to the downtown and midtown demand generators: Centennial Olympic Park, the Atlanta Aquarium, and Mercedes Benz Stadium Replaced unprofitable rest
Slide 20: Case Study – Conversion to Remington Managed
Case Study – Conversion to Remington Managed 20 Acquired the Marriott Fremont in August 2014 357 keys, 15,000 sq. ft. of meeting space Ideally located off Interstate 880 at the gateway to Silicon Valley. Home to over 1,200 technology companies. Announced forward cap rate and EBITDA multiple
Slide 21: Asset Management Initiatives – Recently Completed
Asset Management Initiatives – Recently Completed 21 Hyatt Regency Savannah: Completed guestroom renovation with shower conversions and increased premium rooms inventory by 70 rooms. Also included F&B outlet repositioning, meeting space and lobby. Marriott Bridgewater: Converted 30 king rooms to dou
Slide 22: Asset Management Initiatives – Upcoming
Asset Management Initiatives – Upcoming 22 Renaissance Nashville: Partnering with developer on the adjacent $430 million Fifth & Broadway mixed use development which will provide hotel with upgraded meeting space and eventual fee ownership. Extensive lobby upgrade to be completed. Marriott Crystal G
Slide 23: Total Enterprise Value / Non-Recourse Debt
Stock Price (As of October 27, 2017) $6.95 Fully Diluted Shares Outstanding 117.5 Equity Value $816.5 Plus: Preferred Equity 567.6 Plus: Debt 3,706.2 Total Market Capitalization $5,090.4 Less: Net Working Capital (487.3) Total Enterprise Value $4,603.0 Non-Recourse Debt 23 (1) As of September 30, 20
Slide 24: Cash Target
Cash Target 24 (1) As of September 30, 2017 (2) At market value as of October 27, 2017 Net Working Capital(1) 25-30% CASH TO EQUITY MKT CAP TARGET 48% CURRENT CASH TO EQUITY MKT CAP Ability to execute opportunistic investments BENEFITS Hedge against economic uncertainty One Ocean Jacksonville, FL $4
Slide 25: Value Enhancement through Refinancing
Value Enhancement through Refinancing 25 INDIGO ATLANTA – MAY 2017 5.98% L+2.90% Old Interest Rate New Interest Rate Cash flow savings of ~$585,000 in annual debt service with no change in asset leverage BOSTON BACK BAY – OCT 2017 Cash flow savings of ~$2.8M in annual debt service with no change i
Slide 26: Debt Maturity
$5.4 $95.6 $254.0 $533.0 $710.7 $971.7 $1,154.8 0 200 400 600 800 1000 1200 1400 1600 2017 2018 2019 2020 2021 Thereafter M ill io n s Fixed-Rate Floating-Rate Debt Yield: 11.3% Debt Yield: 12.6% Debt Yield: 10.9% Debt Yield: 14.0% Debt Maturity(1),(2) 26 As of September 30, 2017 (1) Assumes extensi
Slide 27: November 2017
November 2017
Ashford Hospitality Trust — Investor Presentation (November 2017) on 6ix