Ashford Hospitality Trust Inc · NYSE:AHT
Ashford Hospitality Trust — Investor Presentation (September 2014)
31 slides from Ashford Hospitality Trust's investor presentation, Sep 10, 2014
Slide 1: Ashford Hospitality Trust September 2014
ZX. ASHFORD HOSPITALITY TRUST September 2014
Slide 2: Safe Harbor
Safe Harbor 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 projected. When we use the words "will likely
Slide 3: Strong Track Record & Performance
Strong Track Record & Performance 3
Slide 4: Demonstrated Long-Term Track Record
Demonstrated Long-Term Track Record 4 • Disciplined growth, operational expertise, and capital allocation to maximize shareholder returns • AHT expects to benefit from strong management capabilities Peer average includes: BEE, CHSP, CLDT, DRH, FCH, HST, HT, INN, LHO, PEB, RLJ, SHO Trailing Total Sha
Slide 5: Highly-Aligned Management
Highly-Aligned Management 5 • With insider ownership* of approximately 17% for AHT, management is highly-aligned with shareholder interests Publicly-Traded Hotel REIT Insider Ownership Public Lodging REITs include: BEE, CHSP, CLDT, DRH, FCH, HST, HT, INN, LHO, PEB, RLJ, SHO Source: Company filings.
Slide 6: Compelling Opportunity
Compelling Opportunity 6
Slide 7: Compelling Opportunity
7 Compelling Opportunity Proven track record of long-term value creation for shareholders Highly-aligned management team Diversified portfolio with 67% of hotels managed by affiliated property manager Leveraged way to invest in the hotel cycle Opportunity for future platform creation Att
Slide 8: Opportunistic Strategy
8 Opportunistic Strategy Opportunistically invest in hotel assets with up to 2x the national average RevPAR in all market locations Opportunistic use of non-recourse debt to maximize shareholder returns
Slide 9: Portfolio Overview
Portfolio Overview 9 *FY 2013 Hotel EBITDA
Slide 10: Strong Asset Performance
10 50.1% 42.8% 60.0% 69.4% 55.3% 0% 20% 40% 60% 80% 2009 2010 2011 2012 2013 Hotel EBITDA Flow-Through Annual Hotel EBITDA Flow-Through 2012 2013 YTD Q2 2013 YTD Q2 2014 Var RevPAR $94.65 $97.14 $99.85 $107.51 7.0% Hotel Revenue $1,013,117 $1,034,819 $525,440 $556,814 6.0% Hotel EBITDA $305,719 $317
Slide 11: Ashford Trust – Capital Structure
Ashford Trust –Capital Structure 11 » Target Net Debt/Gross Assets of 50-60% » Maintain mix of fixed and floating rate debt » Ladder maturities » Proactively refinance upcoming maturities » Maintain excess cash balance to capitalize on opportunities » Focus on property-level, non-recourse debt Balan
Slide 12: Compelling Valuation
12 Compelling Valuation $248,496 $173,605 $163,225 $50,000 $100,000 $150,000 $200,000 $250,000 $300,000 Ashford Trust Estimated Replacement Cost Estimated Private Market Value Current Trading Value $ per ke y • Ashford Trust is currently trading well below estimated replacement cost and estimated pr
Slide 13: Highland Investment Update
13 Acquisition • Transformational 28-hotel, $1.3 billion acquisition • Invested in the mezzanine debt in 2008 via joint venture • Completed foreclosure & restructuring in March 2011 with new $150 million investment from Ashford Trust & $50 million investment from JV partner • Ashford Trust owns 72%
Slide 14: Marriott Fremont Transaction
14 Marriott Fremont Transaction *TTM through 6/30/14 Strengths/Opportunities: • Excellent location in strong Silicon Valley hotel market • Diversified customer base • High quality asset with minimal capex needs – recently renovated guestrooms, meeting space and Greatroom- certified lobby • Opportuni
Slide 15: Growth & Acquisition Strategy
Growth & Acquisition Strategy 15
Slide 16: Growth & Acquisition Strategy
16 Highly quantitative approach focused on long-term accretion Proven track record of value-creating opportunistic acquisitions Disciplined capital allocation Multiple ways to grow platform: Internal growth from asset performance Portfolio/single asset acquisitions Highland portfolio o
Slide 17: Accretive Growth
Accretive Growth 17 - Ashford Trust management is focused on accretive growth - Our definition of accretion: the 5-year Total Shareholder Return (TSR) post-transaction must be greater than the 5-year TSR pre-transaction - Transactions are modeled on a leverage-neutral basis Base Model Transaction (L
Slide 18: Projected Hotel Room Value Growth
Projected Hotel Room Value Growth 18 Source: JLL/HVS • U.S. hotel transaction volume is likely to increase over the next several years as private U.S. hotel market values rise $0 $10 $20 $30 $40 $50 $40,000 $50,000 $60,000 $70,000 $80,000 $90,000 $100,000 $110,000 $120,000 $130,000 $140,000 2000 200
Slide 19: Ashford Inc. Growth Opportunities
19 Real Estate Hedged Equity Strategy Ashford Inc. Pro Forma Structure To be spun-off as a publicly traded entity (ticker "AINC") Asset management platform Fee structure based on 70bps of total enterprise value plus incentive fees based on total shareholder returns vs. peer set Potential Fut
Slide 20: Appendix
APPENDIX 4. ASHFORD
Slide 21: Ashford Family of Companies
21 Ashford Family of Companies - Publicly Traded (NYSE: AHP) - 10 hotels - 3,472 owned rooms - Market Cap of $1.3 billion - High RevPAR portfolio - US & international gateway markets - Lower-leverage platform - Publicly Traded (NYSE: AHT) - 116 hotels – 23,063 owned rooms - Market Cap of $4.1 billio
Slide 22: Industry Overview
Industry Overview 4. ASHFORD
Slide 23: Attractive Supply/Demand Imbalance
• Demand expected to exceed supply through at least 2015 23 Attractive Supply/Demand Imbalance Source: PKF -8.0 -6.0 -4.0 -2.0 0.0 2.0 4.0 6.0 8.0 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014F 2015F Supply Growth Demand Growth Yea r- o v e r- Year % Gro w th PKF Forecast
Slide 24: PKF RevPAR Growth Forecasts
24 Source: PKF 7.7% 6.1% -2.0% -16.7% 5.4% 8.2% 6.8% 5.4% 8.2% 6.7% 5.8% -20.0% -15.0% -10.0% -5.0% 0.0% 5.0% 10.0% Historical RevPAR Growth Forecasted RevPAR Growth PKF RevPAR Growth Forecasts
Slide 25: Potential Industry EBITDA Growth Rates
25 Potential Industry EBITDA Growth Rates *Based on PKF RevPAR/ADR/Occupancy projections and EBITDA growth resulting from PKF EBITDA change regression equation. • With strong potential RevPAR gains, those companies with reasonable flow-throughs could experience significant EBITDA growth • PKF estima
Slide 26: Historical Industry Stock Returns
• Historically, attractive returns remain for investors from this point in the lodging cycle 26 Historical Industry Stock Returns % 50% 100% 150% 200% 250% 300% 350% 0 12 24 36 48 60 72 84 96 108 T S R Months from Peak to Peak 1989-1997 1997-2007 2007-Current Index includes AHT, BEE, DRH, FCH, HST,
Slide 27: Executive Bios
Executive Bios 4. ASHFORD
Slide 28: Executive Bios
28 Executive Bios Monty J. Bennett Chief Executive Officer & Chairman of the Board Douglas A. Kessler President Mr. Kessler is the President of Ashford Hospitality Advisors and serves as the President of both Ashford Hospitality Trust (NYSE: AHT) and Ashford Hospitality Prime (NYSE: AHP). He is curr
Slide 29: Executive Bios
29 Executive Bios David A. Brooks Chief Operating Officer, General Counsel & Secretary Mr. Brooks is the chief Operating Officer, General Counsel & Secretary of Ashford Hospitality Advisors and serves as Chief Operating Officer, General Counsel & Secretary of both Ashford Hospitality Trust (NYSE: AH
Slide 30: Executive Bios
30 Executive Bios J. Robison Hays Senior Vice President, Corporate Strategy & Finance Mr. Hays is the Senior Vice President of Corporate Strategy & Finance of Ashford Hospitality Advisors and serves as the Senior Vice President of Corporate Strategy & Finance of both Ashford Hospitality Trust (NYSE:
Slide 31: Executive Bios
31 Executive Bios Mark L. Nunneley Chief Accounting Officer Mr. Nunneley is the Chief Accounting Officer of Ashford Hospitality Advisors and serves as the Chief Accounting Officer of both Ashford Hospitality Trust (NYSE: AHT) and Ashford Hospitality Prime (NYSE: AHP). He has served as the Chief Acco
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