8-K - SHO - Equibles

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): February 23, 2024

Sunstone Hotel Investors, Inc.

(Exact Name of Registrant as Specified in Its Charter)



Maryland	001-32319	20-1296886
(State or Other Jurisdiction of<br>Incorporation or Organization)	(Commission File Number)	(I.R.S. Employer<br>Identification Number)


15 Enterprise, Suite 200 ** Aliso Viejo , California**		92656
(Address of Principal Executive Offices)		(Zip Code)

( 949 ) 330-4000

(Registrant’s telephone number including area code)

N/A

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:


☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))


Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class	Trading Symbol(s)	Name of Each Exchange on Which Registered
Common Stock, $0.01 par value	SHO	New York Stock Exchange
Series H Cumulative Redeemable Preferred Stock, $0.01 par value	SHO.PRH	New York Stock Exchange
Series I Cumulative Redeemable Preferred Stock, $0.01 par value	SHO.PRI	New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).


	Emerging growth company	☐

If an emerging growth company, indicate by checkmark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ◻

Item 2.02.Results of Operations and Financial Condition.

On February 23, 2024, Sunstone Hotel Investors, Inc. (the “Company”) issued a press release regarding its financial results for the fourth quarter and year ended December 31, 2023. The press release referred to supplemental financial information that is available on the Company’s website, free of charge, at www.sunstonehotels.com. A copy of the press release and the supplemental financial information are attached hereto as Exhibits 99.1 and 99.2, respectively, and are incorporated herein by this reference.

The information furnished pursuant to this Item 2.02, including Exhibit 99.1 and Exhibit 99.2, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities under that Section, and shall not be deemed to be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Exchange Act, regardless of any general incorporation language in such filing.

Item 9.01.Financial Statements and Exhibits.

(d) The following exhibits are furnished herewith:

EXHIBIT INDEX


Exhibit No.	****	Description
99.1		Press Release, dated February 23, 2024.
99.2		Supplemental Financial Information for the fourth quarter and year ended December 31, 2023.
104		Cover Page Interactive Data File (embedded within the Inline XBRL document).

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	Sunstone Hotel Investors, Inc.

Date: February 23, 2024	By:	/s/ Aaron R. Reyes
		Aaron R. Reyes (Principal Financial Officer and Duly Authorized Officer)

Exhibit 99.1

For Additional Information:

Aaron Reyes

Sunstone Hotel Investors, Inc.

(949) 382-3018

SUNSTONE HOTEL INVESTORS REPORTS RESULTS FOR FOURTH QUARTER AND FULL YEAR 2023

Returned Nearly $120 Million to Common Stockholders in 2023 Through Dividends and Share Repurchases

ALISO VIEJO, CA – February 23, 2024 – Sunstone Hotel Investors, Inc. (the “Company” or “Sunstone”) (NYSE: SHO) today announced results for the fourth quarter and full year ended December 31, 2023.

Fourth Quarter 2023 Operational Results (as compared to Fourth Quarter 2022):

●	Net Income: Net income was $127.0 million as compared to $17.5 million. Excluding the gain on the hotel sold during the quarter, fourth quarter 2023 net income would have been $3.2 million.
●	Comparable RevPAR: Comparable RevPAR decreased 2.2% to $206.58. The average daily rate was $318.80 and occupancy was 64.8%. RevPAR at the Company’s urban and convention hotels increased 3.5%.
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●	Adjusted EBITDAre: Adjusted EBITDAre, excluding noncontrolling interest decreased 20.5% to $54.6 million.
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●	Adjusted FFO: Adjusted FFO attributable to common stockholders per diluted share decreased 26.9% to $0.19.
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Full Year 2023 Operational Results (as compared to Full Year 2022):

●	Net Income: Net income was $206.7 million as compared to $90.8 million. Excluding the gain on the one hotel sold during 2023 and the three hotels sold in 2022, net income in 2023 would have been $82.9 million as compared to $67.8 million in 2022.
●	Comparable RevPAR: Comparable RevPAR increased 5.6% to $226.56. The average daily rate was $324.58 and occupancy was 69.8%. RevPAR at the Company’s urban and convention hotels increased 15.6%.
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●	Adjusted EBITDAre: Adjusted EBITDAre, excluding noncontrolling interest increased 12.7% to $263.4 million.
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●	Adjusted FFO: Adjusted FFO attributable to common stockholders per diluted share increased 9.2% to $0.95.
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Information regarding the non-GAAP financial measures disclosed in this release is provided below in “Non-GAAP Financial Measures.” Reconciliations of non-GAAP financial measures to the most comparable GAAP measure for each of the periods presented are included later in this release.

Bryan A. Giglia, Chief Executive Officer, stated, “We are pleased with our fourth quarter performance as RevPAR growth, EBITDA and FFO all exceeded the high-end of our guidance ranges. Our convention and urban hotels once again led the portfolio, generating an impressive 16% RevPAR growth for the year driven by continued strength in group and business transient demand.”

Mr. Giglia continued, “During 2023, we successfully executed our strategy of recycling capital, investing in our portfolio, and returning capital to shareholders. Consistent with our investment lifecycle approach, we sold Boston Park Plaza at a strong valuation and are working to recycle those proceeds into new opportunities that we expect will drive long-term accretion in NAV per share. Additionally, we are creating future growth by investing in our portfolio, benefiting from the recently completed conversion of The Westin Washington, DC Downtown, and paving the way for the next layer of growth with the repositioning of the Andaz Miami Beach and Marriott Long Beach Downtown. Our strong earnings growth and ample liquidity allowed us to increase our dividend and repurchase our common stock at a discount to NAV, returning nearly $120 million to shareholders during the year. We believe that our active capital recycling, investment in our portfolio to drive future growth, and meaningful return of capital will position Sunstone for further success in 2024.”

Unaudited Selected Statistical and Financial Data ($ in millions, except RevPAR, ADR and per share amounts)


	Quarter Ended December 31,								Year Ended December 31,
	2023		****	2022		****	Change		2023			2022			Change

Net Income	$	127.0		$	17.5		627.2	%	$	206.7		$	90.8		127.7	%
Income Attributable to Common Stockholders per Diluted Share	$	0.60		$	0.07		757.1	%	$	0.93		$	0.34		173.5	%

Comparable Operating Statistics (1)
RevPAR	$	206.58		$	211.32		(2.2)	%	$	226.56		$	214.49		5.6	%
Occupancy		64.8	%		65.3	%	(50)	bps		69.8	%		65.4	%	440	bps
Average Daily Rate	$	318.80		$	323.62		(1.5)	%	$	324.58		$	327.97		(1.0)	%

Comparable Operating Statistics, excluding The Confidante Miami Beach
RevPAR	$	211.18		$	212.06		(0.4)	%	$	229.71		$	214.43		7.1	%
Occupancy		65.4	%		65.1	%	30	bps		70.3	%		65.1	%	520	bps
Average Daily Rate	$	322.91		$	325.75		(0.9)	%	$	326.76		$	329.39		(0.8)	%

Comparable Adjusted EBITDAre Margin, excluding The Confidante Miami Beach		24.6	%		26.2	%	(160)	bps		27.9	%		28.7	%	(80)	bps

Adjusted EBITDAre, excluding noncontrolling interest	$	54.6		$	68.8		(20.5)	%	$	263.4		$	233.8		12.7	%
Adjusted FFO Attributable to Common Stockholders	$	39.0		$	53.7		(27.5)	%	$	196.5		$	184.6		6.4	%
Adjusted FFO Attributable to Common Stockholders per Diluted Share	$	0.19		$	0.26		(26.9)	%	$	0.95		$	0.87		9.2	%
(1)	Comparable operating statistics presented in this release include all 14 hotels owned by the Company at December 31, 2023, and include both prior ownership results and the Company’s ownership results for The Confidante Miami Beach, acquired by the Company in June 2022.
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The Company’s actual results for the quarter ended December 31, 2023 compare to its guidance previously provided as follows:


Metric ( in millions, except per share data)	Quarter Ended December 31, 2023 Guidance (1)	Quarter Ended<br><br>December 31, 2023<br><br>Actual Results (unaudited)	Performance Relative to Prior Guidance Midpoint
Net Income	$125 to $130	$127	- $1
Total Portfolio RevPAR Growth (2)	- 3.0% to - 6.0%	-2.2%	+ 230 bps
Total Portfolio RevPAR Growth, excluding The Confidante Miami Beach (2)	- 0.5% to - 3.5%	-0.4%	+ 160 bps
Adjusted EBITDAre	$48 to $53	$55	$4
Adjusted FFO Attributable to Common Stockholders	$30 to $35	$39	$7
Adjusted FFO Attributable to Common Stockholders per Diluted Share	$0.14 to $0.17	$0.19	$0.03
Diluted Weighted Average Shares Outstanding	205,500,000	204,225,000	- 1,275,000

All values are in US Dollars.

(1)	Represents guidance presented on November 7, 2023.
(2)	RevPAR Growth reflects comparison to the fourth quarter of 2022.
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2023 Highlights

New Unsecured Term Loan and Hilton San Diego Bayfront Mortgage Repayment: In the second quarter 2023, the Company entered into a new $225.0 million term loan agreement and used substantially all of the proceeds to repay the $220.0 million loan secured by the Hilton San Diego Bayfront. The $225.0 million term loan has an initial term of two years with one 12-month extension, which would result in an extended maturity of May 2026. Following the repayment of the loan secured by the Hilton San Diego Bayfront, all but one of the Company’s 14 hotels are unencumbered, and the Company has no debt maturities until December 2024.

Boston Park Plaza Disposition: In the fourth quarter 2023, the Company sold the 1,060-room Boston Park Plaza for a contractual gross sale price of $370.0 million, or approximately $350,000 per key, and recorded a gain on the sale of $123.8 million. The Company acquired the hotel in 2013 and successfully executed a business plan to reinvigorate the well-located historic hotel, which resulted in substantial earnings growth over the Company’s ownership period. The Company is evaluating opportunities to redeploy a portion of the proceeds from the sale into new acquisition opportunities that meet its reinvestment criteria. 2

The Westin Washington, DC Downtown: In the fourth quarter 2023, the Company converted its Renaissance Washington DC to The Westin Washington, DC Downtown, following a comprehensive renovation. The repositioned hotel is expected to attract additional occupancy and garner higher rates which will increase the earnings potential and value of the hotel.

Andaz Miami Beach Conversion: In the fourth quarter 2023, the Company began the transformation of The Confidante Miami Beach to Andaz Miami Beach. The renovation will encompass all aspects of the property and will meaningfully enhance the earnings potential of the asset. The Company expects to debut the renovated hotel in the fourth quarter of 2024 and to achieve an 8% to 9% net operating income yield on the total investment in the asset upon stabilization.

Marriott Long Beach Downtown Conversion: In the fourth quarter 2023, the Company began the conversion of the Renaissance Long Beach to the Marriott Long Beach Downtown. The renovation and conversion is expected to be substantially completed during the first quarter 2024, and the hotel should realize the benefits of the investment for the remainder of 2024.

Stock Repurchase Program. During 2023, the Company repurchased 5,971,192 shares of its common stock at an average purchase price of $9.43 per share for a total repurchase amount before expenses of $56.3 million. The average purchase price per share represents a substantial discount to consensus estimates of net asset value and implies a highly attractive valuation multiple on the Company’s stabilized cash flow. The Company currently has $454.7 million remaining under its existing stock repurchase program authorization.

Balance Sheet and Liquidity Update

As of December 31, 2023, the Company had $493.7 million of cash and cash equivalents, including restricted cash of $67.3 million, total assets of $3.1 billion, including $2.6 billion of net investments in hotel properties, total debt of $819.1 million and stockholders’ equity of $2.2 billion.

Operations Update

January 2024 and 2023 results included the following ($ in millions, except RevPAR and ADR):


	January
All Hotels	2024 (1)			2023			Change
Room Revenue	$	39.7		$	41.7		(4.9)	%

RevPAR	$	191.47		$	201.54		(5.0)	%
Occupancy		59.5	%		63.2	%	(370)	bps
Average Daily Rate	$	321.79		$	318.89		0.9	%


	January
All Hotels Not Under Renovation (2)	2024 (1)			2023			Change
Room Revenue	$	37.7		$	37.2		1.2	%

RevPAR	$	203.33		$	201.00		1.2	%
Occupancy		62.1	%		61.8	%	30	bps
Average Daily Rate	$	327.42		$	325.25		0.7	%

(1)	January 2024 results are preliminary and may be adjusted during the Company’s month-end close process.
(2)	Excludes The Confidante Miami Beach and the Renaissance Long Beach, which are currently under renovation.
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Capital Investments Update

The Company invested $36.2 million and $110.1 million into its portfolio during the fourth quarter and year ended December 31, 2023, respectively. The majority of the 2023 investment consisted of the conversion of the Renaissance Washington DC to The Westin Washington, DC Downtown, as well as preliminary work on the conversions of The Confidante Miami Beach to Andaz Miami Beach and Renaissance Long Beach to Marriott Long Beach Downtown. The Company’s total capital investment in 2023 was approximately $30 million lower than the midpoint of its estimated range at the start of the year as certain capital expenditures primarily related to the conversion of Andaz Miami Beach will now be incurred in 2024. The Company currently expects to invest approximately $135 million to $155 million into its portfolio in 2024, with the majority of the investment relating to the conversions of Andaz Miami Beach and the Marriott Long Beach Downtown and a soft goods renovation at Wailea Beach Resort. The Company anticipates that it will incur approximately $11 million to $13 million of EBITDAre displacement in 2024 in connection with its planned capital investments, which is approximately $1 million lower than the EBITDAre displacement incurred in 2023. 3

2024 Outlook

For the full year 2024, the Company expects:


Metric ($ in millions, except per share data)		Year Ended<br><br>December 31, 2024<br><br>Guidance (1)
Net Income		$46 to $71
Total Portfolio RevPAR Growth (2)		+ 2.5% to + 5.5%
Total Portfolio RevPAR Growth, excluding The Confidante Miami Beach (2)		+ 5.0% to + 8.0%
Adjusted EBITDAre		$230 to $255
Adjusted FFO Attributable to Common Stockholders		$159 to $184
Adjusted FFO Attributable to Common Stockholders per Diluted Share		$0.78 to $0.90
Diluted Weighted Average Shares Outstanding		204,500,000

(1)	Detailed reconciliations of Net Income to non-GAAP financial measures are provided later in this release.
(2)	RevPAR Growth reflects comparison to full year 2023.
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Full year 2024 guidance is based in part on the following full year assumptions:

●	Full year total Adjusted EBITDAre displacement of approximately $11 million to $13 million in connection with planned capital investments, slightly less than in 2023.
●	Full year corporate overhead expense (excluding deferred stock amortization) of approximately $21 million to $22 million.
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●	Full year interest expense of approximately $52 million to $55 million, including approximately $3 million in amortization of deferred financing costs.
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●	Full year preferred stock dividends of approximately $15 million to $16 million, which includes the Series G, H and I cumulative redeemable preferred stock.
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●	The Confidante Miami Beach is expected to suspend operations late in the first quarter of 2024 to allow for extensive renovation work to be performed. The resort is expected to reopen as Andaz Miami Beach in the fourth quarter of 2024 and the Company currently anticipates that the resort will generate an EBITDAre loss of approximately $3 million to $5 million, excluding pre-opening and certain capitalized costs, in 2024 as the comprehensive transformation is completed.
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Recent Developments

Corporate Responsibility Report. In January 2024, the Company published its 2023 Corporate Responsibility Report. The report includes details on Sunstone’s environmental sustainability, social responsibility and governance (“ESG”) progress during 2022, as well as certain additional initiatives commenced in 2023. A copy of the report can be found on the Corporate Responsibility page of the Company’s website at www.sunstonehotels.com.

Dividend Update

On February 22, 2024, the Company’s Board of Directors declared a cash dividend of $0.07 per share of its common stock. The Company’s Board of Directors also declared cash dividends of $0.382813 per share payable to its Series H cumulative redeemable preferred stockholders and $0.356250 per share payable to its Series I cumulative redeemable preferred stockholders. The dividends will be paid on April 15, 2024 to stockholders of record as of March 28, 2024.

The Company currently expects to continue to pay a quarterly cash common dividend throughout 2024. Consistent with the Company’s past practice, and to the extent that the expected regular quarterly dividends for 2024 do not satisfy its annual distribution requirements, the Company may pay an additional dividend amount in January 2025. The level of any future quarterly dividends will be determined by the Company’s board of directors after considering long-term operating projections, expected capital requirements and risks affecting the Company’s business.

Supplemental Disclosures

Contemporaneous with this release, the Company has furnished a Form 8-K with unaudited financial information. This additional information is being provided as a supplement to the information in this release and other filings with the SEC. The Company has no obligation to update any of the information provided to conform to actual results or changes in the Company’s portfolio, capital structure or future expectations. 4

Earnings Call

The Company will host a conference call to discuss fourth quarter and full year financial results on February 23, 2024, at 1:00 p.m. Eastern Time (10:00 a.m. Pacific Time). A live webcast of the call will be available via the Investor Relations section of the Company’s website at www.sunstonehotels.com. Alternatively, interested parties may dial 1-888-330-3573 and reference conference ID 4831656 to listen to the live call. A replay of the webcast will also be archived on the website.

About Sunstone Hotel Investors, Inc.

Sunstone Hotel Investors, Inc. is a lodging real estate investment trust (“REIT”) that as of the date of this release owns 14 hotels comprised of 6,675 rooms, the majority of which are operated under nationally recognized brands. Sunstone's strategy is to create long-term stakeholder value through the acquisition, active ownership, and disposition of well-located hotel and resort real estate. For further information, please visit Sunstone’s website at www.sunstonehotels.com. The Company’s website is provided as a reference only and any information on the website is not incorporated by reference in this release.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of federal securities laws and regulations. These forward-looking statements are identified by their use of terms and phrases such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “should,” “will” and other similar terms and phrases, including opinions, references to assumptions and forecasts of future results. Forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors that may cause the actual results to differ materially from those anticipated at the time the forward-looking statements are made. These risks include, but are not limited to: we own upper upscale and luxury hotels located in urban and resort destinations in an industry that is highly competitive; events beyond our control, including economic slowdowns or recessions, pandemics, natural disasters, civil unrest and terrorism; inflation increasing costs such as wages, employee-related benefits, food costs, commodity costs, including those used to renovate or reposition our hotels, property taxes, property and liability insurance, utilities and borrowing costs; system security risks, data protection breaches, cyber-attacks and systems integration issues, including those impacting the Company’s suppliers, hotel managers or franchisors; a significant portion of our hotels are geographically concentrated so we may be harmed by economic downturns or natural disasters in these areas of the country; we face possible risks associated with the physical and transitional effects of climate change; uninsured or underinsured losses could harm our financial condition; the operating results of some of our hotels are significantly reliant upon group and transient business generated by large corporate customers, and the loss of such customers for any reason could harm our operating results; the increased use of virtual meetings and other similar technologies could lessen the need for business-related travel, and, therefore, demand for rooms in our hotels may be adversely affected; our hotels require ongoing capital investment and we may incur significant capital expenditures in connection with acquisitions, repositionings and other improvements, some of which are mandated by applicable laws or regulations or agreements with third parties, and the costs of such renovations, repositionings or improvements may exceed our expectations or cause other problems; delays in the acquisition, renovation or repositioning of hotel properties may have adverse effects on our results of operations and returns to our stockholders; accounting for the acquisition of a hotel property or other entity involves assumptions and estimations to determine fair value that could differ materially from the actual results achieved in future periods; volatility in the debt and equity markets may adversely affect our ability to acquire, renovate, refinance or sell our hotels; we may pursue joint venture investments that could be adversely affected by our lack of sole decision-making authority, our reliance on a co-venturer’s financial condition and disputes between us and our co-venturer; we may be subject to unknown or contingent liabilities related to recently sold or acquired hotels, as well as hotels we may sell or acquire in the future; we may seek to acquire a portfolio of hotels or a company, which could present more risks to our business and financial results than the acquisition of a single hotel; the sale of a hotel or portfolio of hotels is typically subject to contingencies, risks and uncertainties, any of which may cause us to be unsuccessful in completing the disposition; the illiquidity of real estate investments and the lack of alternative uses of hotel properties could significantly limit our ability to respond to adverse changes in the performance of our hotels; we may issue or invest in hotel loans, including subordinated or mezzanine loans, which could involve greater risks of loss than senior loans secured by income-producing real properties; if we make or invest in mortgage loans with the intent of gaining ownership of the hotel secured by or pledged to the loan, our ability to perfect an ownership interest in the hotel is subject to the sponsor’s willingness to forfeit the property in lieu of the debt; one of our hotels is subject to a ground lease with an unaffiliated party, the termination of which by the lessor for any reason, including due to our default on the lease, could cause us to lose the ability to operate the hotel altogether and may adversely affect our results of operations; because we are a REIT, we depend on third-parties to operate our hotels; we are subject to risks associated with our operators’ employment of hotel personnel; most of our hotels operate under a brand owned by Marriott, Hilton, Hyatt, Four Seasons or Montage. Should any of these brands experience a negative event, or receive negative publicity, our operating results may be harmed; our franchisors and brand managers may adopt new policies or change existing policies which could result in increased costs that could negatively impact our hotels; future adverse litigation judgments or settlements resulting from legal proceedings could have an adverse effect on our financial condition; claims by persons regarding our properties could affect the attractiveness of our hotels or cause us to incur additional expenses; the hotel business is seasonal and seasonal variations in business volume at our hotels will cause quarterly fluctuations in our revenue and operating results; changes in the debt and equity markets may 5

adversely affect the value of our hotels; certain of our hotels have in the past become impaired and additional hotels may become impaired in the future; laws and governmental regulations may restrict the ways in which we use our hotel properties and increase the cost of compliance with such regulations. Noncompliance with such regulations could subject us to penalties, loss of value of our properties or civil damages; corporate responsibility, specifically related to ESG factors and commitments, may impose additional costs and expose us to new risks that could adversely affect our results of operations, financial condition and cash flows; our franchisors and brand managers may require us to make capital expenditures pursuant to property improvement plans or to comply with brand standards; termination of any of our franchise, management or operating lease agreements could cause us to lose business or lead to a default or acceleration of our obligations under certain of our debt instruments; the growth of alternative reservation channels could adversely affect our business and profitability; the failure of tenants in our hotels to make rent payments or otherwise comply with the material terms of our retail and restaurant leases may adversely affect our results of operations; we rely on our corporate and hotel senior management teams, the loss of whom may cause us to incur costs and harm our business; we could be harmed by inadvertent errors, misconduct or fraud that is difficult to detect; if we fail to maintain effective internal control over financial reporting and disclosure controls and procedures, we may not be able to accurately report our financial results or identify and prevent fraud; we have outstanding debt which may restrict our financial flexibility; certain of our debt is subject to variable interest rates, which creates uncertainty in the amount of interest expense we will incur in the future and may negatively impact our operating results; our stock repurchase program may not enhance long-term stockholder value, and could cause volatility in the price of our common and preferred stock and could diminish our cash reserves; and other risks and uncertainties associated with the Company’s business described in its filings with the Securities and Exchange Commission. Although the Company believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that the expectations will be attained or that any deviation will not be material. All forward-looking information provided herein is as of the date of this release, and the Company undertakes no obligation to update any forward-looking statement to conform the statement to actual results or changes in the Company’s expectations.

This release should be read together with the consolidated financial statements and notes thereto included in our most recent reports on Form 10-K and Form 10-Q. Copies of these reports are available on our website at www.sunstonehotels.com and through the SEC’s Electronic Data Gathering Analysis and Retrieval System (“EDGAR”) at www.sec.gov.

Non-GAAP Financial Measures

We present the following non-GAAP financial measures that we believe are useful to investors as key supplemental measures of our operating performance: earnings before interest expense, taxes, depreciation and amortization for real estate, or EBITDAre; Adjusted EBITDAre, excluding noncontrolling interest (as defined below); funds from operations attributable to common stockholders, or FFO attributable to common stockholders; Adjusted FFO attributable to common stockholders (as defined below); hotel Adjusted EBITDAre; and hotel Adjusted EBITDAre margins. These measures should not be considered in isolation or as a substitute for measures of performance in accordance with GAAP. In addition, our calculation of these measures may not be comparable to other companies that do not define such terms exactly the same as the Company. These non-GAAP measures are used in addition to and in conjunction with results presented in accordance with GAAP. They should not be considered as alternatives to net income (loss), cash flow from operations, or any other operating performance measure prescribed by GAAP. These non-GAAP financial measures reflect additional ways of viewing our operations that we believe, when viewed with our GAAP results and the reconciliations to the corresponding GAAP financial measures, provide a more complete understanding of factors and trends affecting our business than could be obtained absent this disclosure. We strongly encourage investors to review our financial information in its entirety and not to rely on a single financial measure.

We present EBITDAre in accordance with guidelines established by the National Association of Real Estate Investment Trusts (“Nareit”), as defined in its September 2017 white paper “Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate.” We believe EBITDAre is a useful performance measure to help investors evaluate and compare the results of our operations from period to period in comparison to our peers. Nareit defines EBITDAre as net income (calculated in accordance with GAAP) plus interest expense, income tax expense, depreciation and amortization, gains or losses on the disposition of depreciated property (including gains or losses on change in control), impairment write-downs of depreciated property and of investments in unconsolidated affiliates caused by a decrease in the value of depreciated property in the affiliate, and adjustments to reflect the entity’s share of EBITDAre of unconsolidated affiliates.

We make additional adjustments to EBITDAre when evaluating our performance because we believe that the exclusion of certain additional items described below provides useful information to investors regarding our operating performance, and that the presentation of Adjusted EBITDAre, excluding noncontrolling interest, when combined with the primary GAAP presentation of net income, is beneficial to an investor’s complete understanding of our operating performance. In addition, we use both EBITDAre and Adjusted EBITDAre, excluding noncontrolling interest as measures in determining the value of hotel acquisitions and dispositions.

We believe that the presentation of FFO attributable to common stockholders provides useful information to investors regarding our operating performance because it is a measure of our operations without regard to specified noncash items such as real estate depreciation and amortization, any real estate impairment loss and any gain or loss on sale of real estate assets, all of which are based on historical cost accounting and may be of lesser significance in evaluating our current performance. Our presentation of FFO attributable to common stockholders conforms to Nareit’s definition of “FFO applicable to common shares.” Our presentation may not be comparable to FFO reported by other REITs that do not define the terms in accordance with the current Nareit definition, or that interpret the current Nareit definition differently than we do.

We also present Adjusted FFO attributable to common stockholders when evaluating our operating performance because we believe that the exclusion of certain additional items described below provides useful supplemental information to investors regarding our ongoing operating performance and may facilitate comparisons of operating performance between periods and our peer companies.

We adjust EBITDAre and FFO attributable to common stockholders for the following items, which may occur in any period, and refer to these measures as either Adjusted EBITDAre, excluding noncontrolling interest or Adjusted FFO attributable to common stockholders:

●	Amortization of deferred stock compensation: we exclude the noncash expense incurred with the amortization of deferred stock compensation as this expense is based on historical stock prices at the date of grant to our corporate employees and does not reflect the underlying performance of our hotels.

●	Amortization of contract intangibles: we exclude the noncash amortization of any favorable or unfavorable contract intangibles recorded in conjunction with our hotel acquisitions. We exclude the noncash amortization of contract intangibles because it is based on historical cost accounting and is of lesser significance in evaluating our actual performance for the current period.

●

Gains or losses from debt transactions: we exclude the effect of finance charges and premiums associated with the extinguishment of debt, including the acceleration of deferred financing costs from the original issuance of the debt being redeemed or retired because, like interest expense, their removal helps investors evaluate and compare the results of our operations from period to period by removing the impact of our capital structure.

●

Cumulative effect of a change in accounting principle: from time to time, the FASB promulgates new accounting standards that require the consolidated statement of operations to reflect the cumulative effect of a change in accounting principle. We exclude these one-time adjustments, which include the accounting impact from prior periods, because they do not reflect our actual performance for that period.

●

Other adjustments: we exclude other adjustments that we believe are outside the ordinary course of business because we do not believe these costs reflect our actual performance for the period and/or the ongoing operations of our hotels. Such items may include: lawsuit settlement costs; the write-off of development costs associated with abandoned projects; property-level restructuring, severance, pre-opening and management transition costs; debt resolution costs; lease terminations; property insurance restoration proceeds or uninsured losses; and other nonrecurring identified adjustments.

In addition, to derive Adjusted EBITDAre, excluding noncontrolling interest we exclude the noncontrolling partner’s pro rata share of the net income allocated to the Hilton San Diego Bayfront partnership prior to our acquisition of the noncontrolling partner’s interest in June 2022, as well as the noncontrolling partner’s pro rata share of any EBITDAre and Adjusted EBITDAre components. We also exclude the amortization of our right-of-use assets and related lease obligations as these expenses are based on historical cost accounting and do not reflect the actual rent amounts due to the respective lessors or the underlying performance of our hotels. Additionally, we include an adjustment for the cash finance lease expense recorded on the building lease at the Hyatt Centric Chicago Magnificent Mile (prior to the hotel’s sale in February 2022). We determined that the building lease was a finance lease, and, therefore, we included a portion of the lease payment each month in interest expense. We adjust EBITDAre for the finance lease in order to more accurately reflect the actual rent due to the hotel’s lessor in the respective period, as well as the operating performance of the hotel. We also exclude the effect of gains and losses on the disposition of undepreciated assets because we believe that including them in Adjusted EBITDAre, excluding noncontrolling interest is not consistent with reflecting the ongoing performance of our assets.

intangibles (with the exception of our corporate operating lease), as these expenses are based on historical cost accounting and do not reflect the actual rent amounts due to the respective lessors or the underlying performance of our hotels. In addition, we exclude preferred stock redemption charges, changes to deferred tax assets, liabilities or valuation allowances, and income tax benefits or provisions associated with the application of net operating loss carryforwards, uncertain tax positions or with the sale of assets.

In presenting hotel Adjusted EBITDAre and hotel Adjusted EBITDAre margins, miscellaneous non-hotel items have been excluded. We believe the calculation of hotel Adjusted EBITDAre results in a more accurate presentation of the hotel Adjusted EBITDAre margins for our hotels, and that these non-GAAP financial measures are useful to investors in evaluating our property-level operating performance.

Comparable operating statistics in this release include both prior ownership results and the Company’s ownership results for The Confidante Miami Beach, acquired by the Company in June 2022. We obtained prior ownership information from the previous owner of The Confidante Miami Beach during the due diligence period before acquiring the hotel. We performed a limited review of the information as part of our analysis of the acquisition. We believe providing comparable hotel data is useful to us and to investors in evaluating our operating performance because this measure helps us and investors evaluate and compare the results of our operations from period to period by removing the fluctuations caused by any acquisitions or dispositions.

Reconciliations of net income to EBITDAre, Adjusted EBITDAre, excluding noncontrolling interest, FFO attributable to common stockholders, Adjusted FFO attributable to common stockholders, hotel Adjusted EBITDAre and hotel Adjusted EBITDAre margins are set forth in the following pages of this release.

Sunstone Hotel Investors, Inc.

Consolidated Balance Sheets

(In thousands, except share and per share data)


	December 31,			December 31,
	2023		****	2022

Assets
Investment in hotel properties, net	$	2,585,279		$	2,840,928
Operating lease right-of-use assets, net		12,755			15,025
Cash and cash equivalents		426,403			101,223
Restricted cash		67,295			55,983
Accounts receivable, net		31,206			42,092
Prepaid expenses and other assets, net		26,383			27,566
Total assets	$	3,149,321		$	3,082,817

Liabilities
Debt, net of unamortized deferred financing costs	$	814,559		$	812,681
Operating lease obligations		16,735			19,012
Accounts payable and accrued expenses		48,410			73,735
Dividends and distributions payable		29,965			13,995
Other liabilities		73,014			78,433
Total liabilities		982,683			997,856

Commitments and contingencies

Stockholders' equity
Preferred stock, $0.01 par value, 100,000,000 shares authorized:
Series G Cumulative Redeemable Preferred Stock, 2,650,000 shares issued and outstanding at both December 31, 2023 and December 31, 2022, stated at liquidation preference of $25.00 per share		66,250			66,250
6.125% Series H Cumulative Redeemable Preferred Stock, 4,600,000 shares issued and outstanding at both December 31, 2023 and December 31, 2022, stated at liquidation preference of $25.00 per share		115,000			115,000
5.70% Series I Cumulative Redeemable Preferred Stock, 4,000,000 shares issued and outstanding at both December 31, 2023 and December 31, 2022, stated at liquidation preference of $25.00 per share		100,000			100,000
Common stock, $0.01 par value, 500,000,000 shares authorized, 203,479,585 shares issued and outstanding at December 31, 2023 and 209,320,447 shares issued and outstanding at December 31, 2022		2,035			2,093
Additional paid in capital		2,416,417			2,465,595
Distributions in excess of retained earnings		(533,064)			(663,977)
Total stockholders' equity		2,166,638			2,084,961

Total liabilities and stockholders' equity	$	3,149,321		$	3,082,817

Sunstone Hotel Investors, Inc.

Consolidated Statements of Operations

(In thousands, except per share data)


		Quarter Ended December 31,				Year Ended December 31,
	****	2023		2022		2023		2022
		(unaudited)
Revenues
Room		$	134,973	$	147,277	$	619,277	$	576,170
Food and beverage			63,880		65,847		277,514		240,564
Other operating			20,372		31,020		89,689		95,319
Total revenues			219,225		244,144		986,480		912,053
Operating expenses
Room			35,246		38,691		158,002		145,285
Food and beverage			45,511		48,187		193,820		174,146
Other operating			5,690		5,380		23,721		23,345
Advertising and promotion			12,272		12,559		51,958		46,979
Repairs and maintenance			9,196		9,432		38,308		36,801
Utilities			5,978		6,705		27,622		26,357
Franchise costs			4,120		4,410		16,876		15,839
Property tax, ground lease and insurance			18,476		15,819		78,796		68,979
Other property-level expenses			27,593		30,003		120,247		113,336
Corporate overhead			7,421		7,936		31,412		35,246
Depreciation and amortization			29,135		32,393		127,062		126,396
Impairment losses			—		3,466		—		3,466
Total operating expenses			200,638		214,981		867,824		816,175
Interest and other income			4,137		476		10,535		5,242
Interest expense			(16,768)		(11,717)		(51,679)		(32,005)
Gain on sale of assets			123,820		—		123,820		22,946
Gain (loss) on extinguishment of debt, net			8		26		9,938		(936)
Income before income taxes			129,784		17,948		211,270		91,125
Income tax provision, net			(2,799)		(485)		(4,562)		(359)
Net income			126,985		17,463		206,708		90,766
Income from consolidated joint venture attributable to noncontrolling interest			—		—		—		(3,477)
Preferred stock dividends			(3,226)		(3,350)		(13,988)		(14,247)
Income attributable to common stockholders		$	123,759	$	14,113	$	192,720	$	73,042

Basic and diluted per share amounts:
Basic and diluted income attributable to common stockholders per common share		$	0.60	$	0.07	$	0.93	$	0.34

Basic weighted average common shares outstanding			203,612		209,097		205,590		212,613
Diluted weighted average common shares outstanding			203,833		209,109		205,865		212,653

Distributions declared per common share		$	0.13	$	0.05	$	0.30	$	0.10

Sunstone Hotel Investors, Inc.

Reconciliation of Net Income to Non-GAAP Financial Measures

(Unaudited and in thousands)

Reconciliation of Net Income to EBITDAre and Adjusted EBITDAre**, Excluding Noncontrolling Interest**


	Quarter Ended December 31,				Year Ended December 31,
	2023		2022		2023			2022

Net income	$	126,985	$	17,463	$	206,708	$	90,766
Operations held for investment:
Depreciation and amortization		29,135		32,393		127,062		126,396
Interest expense		16,768		11,717		51,679		32,005
Income tax provision, net		2,799		485		4,562		359
Gain on sale of assets		(123,820)		—		(123,820)		(22,946)
Impairment losses - depreciable assets		—		1,379		—		1,379
EBITDAre		51,867		63,437		266,191		227,959

Operations held for investment:
Amortization of deferred stock compensation		2,512		2,230		10,775		10,891
Amortization of right-of-use assets and obligations		(20)		(359)		(102)		(1,409)
Amortization of contract intangibles, net		—		(18)		(55)		(61)
Finance lease obligation interest - cash ground rent		—		—		—		(117)
(Gain) loss on extinguishment of debt, net		(8)		(26)		(9,938)		936
Hurricane-related insurance restoration proceeds net of losses		—		—		(3,722)		(2,755)
Property-level severance		297		729		297		729
Costs associated with financing no longer pursued		—		697		—		697
Impairment loss - right-of-use asset		—		2,087		—		2,087
Noncontrolling interest		—		—		—		(5,175)
Adjustments to EBITDAre, net		2,781		5,340		(2,745)		5,823

Adjusted EBITDAre, excluding noncontrolling interest	$	54,648	$	68,777	$	263,446	$	233,782

Sunstone Hotel Investors, Inc.

Reconciliation of Net Income to Non-GAAP Financial Measures

(Unaudited and in thousands, except per share data)

Reconciliation of Net Income to FFO Attributable to Common Stockholders and

Adjusted FFO Attributable to Common Stockholders


		Quarter Ended December 31,				Year Ended December 31,
		2023		2022		2023			2022

Net income	****	$	126,985	$	17,463	$	206,708	$	90,766
Preferred stock dividends			(3,226)		(3,350)		(13,988)		(14,247)
Operations held for investment:
Real estate depreciation and amortization			28,979		32,023		126,435		124,819
Gain on sale of assets			(123,820)		—		(123,820)		(22,946)
Noncontrolling interest			—		—		—		(4,933)
FFO attributable to common stockholders			28,918		46,136		195,335		173,459

Operations held for investment:
Amortization of deferred stock compensation			2,512		2,230		10,775		10,891
Real estate amortization of right-of-use assets and obligations			(134)		(287)		(505)		(1,155)
Amortization of contract intangibles, net			105		78		357		422
Noncash interest on derivatives, net			3,600		710		252		(2,194)
(Gain) loss on extinguishment of debt, net			(8)		(26)		(9,938)		936
Hurricane-related insurance restoration proceeds net of losses			—		—		(3,722)		(2,755)
Property-level severance			297		729		297		729
Income tax related to hotel disposition			3,662		—		3,662		—
Costs associated with financing no longer pursued			—		697		—		697
Impairment losses - right-of-use and depreciable assets			—		3,466		—		3,466
Noncontrolling interest			—		—		—		132
Adjustments to FFO attributable to common stockholders, net			10,034		7,597		1,178		11,169

Adjusted FFO attributable to common stockholders		$	38,952	$	53,733	$	196,513	$	184,628

FFO attributable to common stockholders per diluted share		$	0.14	$	0.22	$	0.95	$	0.81

Adjusted FFO attributable to common stockholders per diluted share		$	0.19	$	0.26	$	0.95	$	0.87

Basic weighted average shares outstanding			203,612		209,097		205,590		212,613
Shares associated with unvested restricted stock awards			613		449		508		358
Diluted weighted average shares outstanding			204,225		209,546		206,098		212,971

Sunstone Hotel Investors, Inc.

Reconciliation of Net Income to Non-GAAP Financial Measures

Guidance for Full Year 2024

(Unaudited and in thousands, except for per share amounts)

Reconciliation of Net Income to Adjusted EBITDAre


	Year Ended
	December 31, 2024
		Low	****		High

Net income	$	45,500		$	70,500
Depreciation and amortization		115,000			115,000
Interest expense		53,500			53,500
Income tax provision		1,000			1,000
Amortization of deferred stock compensation		11,000			11,000
Pre-opening costs		4,000			4,000
Adjusted EBITDAre	$	230,000		$	255,000

Reconciliation of Net Income to Adjusted FFO Attributable to Common Stockholders


		Year Ended
		December 31, 2024
			Low	****		High

Net income	****	$	45,500		$	70,500
Preferred stock dividends			(15,500)			(15,500)
Real estate depreciation and amortization			114,000			114,000
Amortization of deferred stock compensation			11,000			11,000
Pre-opening costs			4,000			4,000
Adjusted FFO attributable to common stockholders		$	159,000		$	184,000

Adjusted FFO attributable to common stockholders per diluted share		$	0.78		$	0.90

Diluted weighted average shares outstanding			204,500			204,500

Sunstone Hotel Investors, Inc.

Non-GAAP Financial Measures

Hotel Adjusted EBITDAre and Margins

(Unaudited and in thousands)


	Quarter Ended December 31,				Year Ended December 31,
	2023		2022		2023		2022

Comparable Hotel Adjusted EBITDAre Margin (1)		24.0%		26.1%		27.5%		28.7%
Comparable Hotel Adjusted EBITDAre Margin, Excluding The Confidante Miami Beach (1)		24.6%		26.2%		27.9%		28.7%


Total revenues	$	219,225	$	244,144	$	986,480	$	912,053
Non-hotel revenues (2)		—		(18)		(55)		(75)
Business interruption insurance proceeds (3)		—		(9,987)		—		(9,987)
Total Actual Hotel Revenues		219,225		234,139		986,425		901,991
Prior ownership hotel revenues (4)		—		—		—		22,637
Sold hotel revenues (5)		(11,131)		(26,797)		(96,713)		(97,915)
Comparable Hotel Revenues		208,094		207,342		889,712		826,713
The Confidante Miami Beach revenues (6)		(4,745)		(10,030)		(32,730)		(43,070)
Comparable Hotel Revenues, Excluding The Confidante Miami Beach	$	203,349	$	197,312	$	856,982	$	783,643


Net income	$	126,985	$	17,463	$	206,708	$	90,766
Non-hotel revenues (2)		—		(18)		(55)		(75)
Business interruption insurance proceeds related to owned hotels (7)		—		(6,157)		—		(6,157)
Non-hotel operating expenses, net (8)		(274)		(6,466)		(1,169)		(7,551)
Taxes assessed on commercial rents (9)		109		61		553		176
Property-level legal fees (10)		—		208		—		208
Property-level severance (11)		297		974		297		974
Property-level hurricane-related restoration expenses (12)		—		306		—		1,920
Corporate overhead		7,421		7,936		31,412		35,246
Depreciation and amortization		29,135		32,393		127,062		126,396
Impairment losses		—		3,466		—		3,466
Interest and other income		(4,137)		(476)		(10,535)		(5,242)
Interest expense		16,768		11,717		51,679		32,005
Gain on sale of assets		(123,820)		—		(123,820)		(22,946)
(Gain) loss on extinguishment of debt, net		(8)		(26)		(9,938)		936
Income tax provision, net		2,799		485		4,562		359
Actual Hotel Adjusted EBITDAre		55,275		61,866		276,756		250,481
Prior ownership hotel Adjusted EBITDAre (4)		—		—		—		8,630
Sold hotel Adjusted EBITDAre (5)		(5,420)		(7,782)		(32,024)		(22,005)
Comparable Hotel Adjusted EBITDAre		49,855		54,084		244,732		237,106
The Confidante Miami Beach Adjusted EBITDAre (6)		220		(2,474)		(5,881)		(12,421)
Comparable Hotel Adjusted EBITDAre, Excluding The Confidante Miami Beach	$	50,075	$	51,610	$	238,851	$	224,685

*Footnotes on following page 14

(1)	Comparable Hotel Adjusted EBITDAre Margin is calculated as Comparable Hotel Adjusted EBITDAre divided by Comparable Hotel Revenues. Comparable Hotel Adjusted EBITDAre Margin, Excluding The Confidante Miami Beach is calculated as Comparable Hotel Adjusted EBITDAre, Excluding The Confidante Miami Beach divided by Comparable Hotel Revenues, Excluding The Confidante Miami Beach.
(2)	Non-hotel revenues include the amortization of any favorable or unfavorable contract intangibles recorded in conjunction with the Company's hotel acquisitions.
---	---
(3)	Business interruption insurance proceeds include $10.0 million in proceeds recognized in the fourth quarter and full year of 2022 related to COVID-19 disruption at 11 hotels currently owned by the Company and nine sold hotels.
---	---
(4)	Prior ownership hotel revenues and Adjusted EBITDAre include results for The Confidante Miami Beach prior to the Company’s acquisition of the hotel in June 2022. The Company obtained prior ownership information from the hotel’s previous owner during the due diligence period before acquiring the hotel. The Company performed a limited review of the information as part of its analysis of the acquisition. The Company determined the amount to include as pro forma depreciation expense based on the hotel’s actual depreciation expense recognized by the Company.
---	---
(5)	Sold hotel revenues and Adjusted EBITDAre for all periods presented include results for the Boston Park Plaza, sold in October 2023. Sold hotel revenues and Adjusted EBITDAre for the full year of 2022 also include results for the Embassy Suites Chicago and the Hilton Garden Inn Chicago Downtown/Magnificent Mile, sold in March 2022, and the Hyatt Centric Chicago Magnificent Mile, sold in February 2022.
---	---
(6)	The Confidante Miami Beach is undergoing a comprehensive renovation and conversion to Andaz Miami Beach and results are not comparable to prior periods.
---	---
(7)	Business interruption insurance proceeds related to owned hotels include $6.2 million in proceeds recognized in the fourth quarter and full year of 2022 related to COVID-19 disruption at 11 hotels currently owned by the Company.
---	---
(8)	Non-hotel operating expenses, net for all periods presented include the amortization of hotel real estate-related right-of-use assets and obligations. Non-hotel operating expenses, net for both the full years of 2023 and 2022 include prior year property tax credits related to sold hotels. Non-hotel operating expenses, net for both the fourth quarter and full year of 2022 include $3.8 million in business interruption insurance proceeds related to COVID-19 at nine sold hotels. Non-hotel operating expenses, net for the full year of 2022 also include the amortization of a favorable management agreement contract intangible prior to the hotel's sale in March 2022, and finance lease obligation interest - cash ground rent prior to the hotel's sale in February 2022.
---	---
(9)	Taxes assessed on commercial rents include $0.1 million for both the fourth quarters of 2023 and 2022, and $0.6 million and $0.2 million for the full years of 2023 and 2022, respectively, at the Hyatt Regency San Francisco.
---	---
(10)	Property-level legal fees for both the fourth quarter and full year of 2022 include $0.2 million in fees related to business interruption insurance proceeds at 11 hotels currently owned by the Company.
---	---
(11)	Property-level severance for the fourth quarter and full year of 2023 includes $0.3 million at The Confidante Miami Beach. Property-level severance for the fourth quarter and full year of 2022 includes a total of $1.0 million, comprising $0.7 million at the Hyatt Regency San Francisco and $0.2 million at the Four Seasons Resort Napa Valley.
---	---
(12)	Property-level hurricane-related restoration expenses for the fourth quarter and full year of 2022 include a total of $0.3 million incurred at the Oceans Edge Resort & Marina and the Renaissance Orlando at SeaWorld®. Property-level hurricane-related restoration expenses for the full year of 2022 also include a total of $1.6 million incurred at the Hilton New Orleans St. Charles and the JW Marriott New Orleans.
---	---

Exhibit 99.2


<br><br><br><br>Supplemental Financial Information<br><br>For the quarter and year ended December 31, 2023<br><br>February 23, 2024<br><br>

Supplemental Financial Information February 23, 2024

Table of Contents


Corporate Profile And Disclosures Regarding Non-GAAP Financial Measures								2
Comparable Corporate Financial Information								7
Capitalization								19
Property-Level Data And Operating Statistics								22
Property-Level Revenues, Adjusted EBITDAre & Adjusted EBITDAre Margins								28

Supplemental Financial Information February 23, 2024

CORPORATE PROFILE AND DISCLOSURES REGARDING NON-GAAP FINANCIAL MEASURES


CORPORATE PROFILE AND DISCLOSURES REGARDING NON-GAAP FINANCIAL MEASURES			Page 2

Supplemental Financial Information February 23, 2024

About Sunstone

Sunstone Hotel Investors, Inc. (the “Company,” “we,” and “our”) (NYSE: SHO) is a lodging real estate investment trust (“REIT”) that as of February 23, 2024 owns 14 hotels comprised of 6,675 rooms, the majority of which are operated under nationally recognized brands. Sunstone’s strategy is to create long-term stakeholder value through the acquisition, active ownership and disposition of well-located hotel and resort real estate.

This presentation contains unaudited information and should be read together with the consolidated financial statements and notes thereto included in our most recent reports on Form 10-K and Form 10-Q. Copies of these reports are available on our website at www.sunstonehotels.com and through the SEC’s Electronic Data Gathering Analysis and Retrieval System (“EDGAR”) at www.sec.gov.

Corporate Headquarters 15 Enterprise, Suite 200 Aliso Viejo, CA 92656 (949) 330-4000

Company Contacts Bryan Giglia Chief Executive Officer (949) 382-3036

Aaron Reyes Chief Financial Officer (949) 382-3018


CORPORATE PROFILE AND DISCLOSURES REGARDING NON-GAAP FINANCIAL MEASURES			Page 3

Supplemental Financial Information February 23, 2024

Non-GAAP Financial Measures

We believe that the presentation of FFO attributable to common stockholders provides useful information to investors regarding our operating performance because it is a measure of our operations without regard to specified noncash items such as real estate depreciation and amortization, any real estate impairment loss and any gain or loss on sale of real estate assets, all of which are based on historical cost accounting and may be of lesser significance in evaluating our current performance. Our presentation of FFO attributable to common stockholders conforms to the Nareit definition of “FFO applicable to common shares.” Our presentation may not be comparable to FFO reported by other REITs that do not define the terms in accordance with the current Nareit definition, or that interpret the current Nareit definition differently than we do.

We also present Adjusted FFO attributable to common stockholders when evaluating our operating performance because we believe that the exclusion of certain additional items described below provides useful supplemental information to investors regarding our ongoing operating performance, and may facilitate comparisons of operating performance between periods and our peer companies.


CORPORATE PROFILE AND DISCLOSURES REGARDING NON-GAAP FINANCIAL MEASURES			Page 4

Supplemental Financial Information February 23, 2024

●	Amortization of deferred stock compensation: we exclude the noncash expense incurred with the amortization of deferred stock compensation as this expense is based on historical stock prices at the date of grant to our corporate employees and does not reflect the underlying performance of our hotels.
●	Amortization of contract intangibles: we exclude the noncash amortization of any favorable or unfavorable contract intangibles recorded in conjunction with our hotel acquisitions. We exclude the noncash amortization of contract intangibles because it is based on historical cost accounting and is of lesser significance in evaluating our actual performance for the current period.
---	---
●	Gains or losses from debt transactions: we exclude the effect of finance charges and premiums associated with the extinguishment of debt, including the acceleration of deferred financing costs from the original issuance of the debt being redeemed or retired because, like interest expense, their removal helps investors evaluate and compare the results of our operations from period to period by removing the impact of our capital structure.
---	---
●	Cumulative effect of a change in accounting principle: from time to time, the FASB promulgates new accounting standards that require the consolidated statement of operations to reflect the cumulative effect of a change in accounting principle. We exclude these one-time adjustments, which include the accounting impact from prior periods, because they do not reflect our actual performance for that period.
---	---
●	Other adjustments: we exclude other adjustments that we believe are outside the ordinary course of business because we do not believe these costs reflect our actual performance for the period and/or the ongoing operations of our hotels. Such items may include: lawsuit settlement costs; the write-off of development costs associated with abandoned projects; property-level restructuring, severance, pre-opening and management transition costs; debt resolution costs; lease terminations; property insurance restoration proceeds or uninsured losses; and other nonrecurring identified adjustments.
---	---


CORPORATE PROFILE AND DISCLOSURES REGARDING NON-GAAP FINANCIAL MEASURES			Page 5

Supplemental Financial Information February 23, 2024

To derive Adjusted FFO attributable to common stockholders, we also exclude the noncash interest on our derivatives and finance lease obligation as we believe that these items are not reflective of our ongoing finance costs. Additionally, we exclude the noncontrolling partner’s pro rata share of any FFO adjustments related to our consolidated Hilton San Diego Bayfront partnership components prior to our acquisition of the noncontrolling partner’s interest in June 2022. We also exclude the real estate amortization of our right-of-use assets and related lease obligations, which includes the amortization of both our finance and operating lease intangibles (with the exception of our corporate operating lease), as these expenses are based on historical cost accounting and do not reflect the actual rent amounts due to the respective lessors or the underlying performance of our hotels. In addition, we exclude preferred stock redemption charges, changes to deferred tax assets, liabilities or valuation allowances, and income tax benefits or provisions associated with the application of net operating loss carryforwards, uncertain tax positions or with the sale of assets.


CORPORATE PROFILE AND DISCLOSURES REGARDING NON-GAAP FINANCIAL MEASURES			Page 6

Supplemental Financial Information February 23, 2024

COMPARABLE CORPORATE FINANCIAL INFORMATION


COMPARABLE CORPORATE FINANCIAL INFORMATION			Page 7

Supplemental Financial Information February 23, 2024

Comparable Consolidated Statements of Operations

Q4 2023 – Q1 2023, FY 2023


	Quarter Ended (1)								Year Ended (1)
(Unaudited and in thousands, except per share data)	December 31,		September 30,		June 30,		March 31,		December 31,
	2023		2023		2023		2023		2023
Revenues
Room	$	127,038	$	134,428	$	149,923	$	141,257	$	552,646
Food and beverage		61,284		56,835		70,921		65,210		254,250
Other operating		19,772		22,398		21,728		18,918		82,816
Total revenues		208,094		213,661		242,572		225,385		889,712

Operating Expenses
Room		33,388		33,844		35,566		33,959		136,757
Food and beverage		43,907		42,725		46,897		44,281		177,810
Other expenses		81,076		82,895		83,556		82,567		330,094
Corporate overhead		7,421		7,127		8,396		8,468		31,412
Depreciation and amortization		29,135		29,134		28,038		27,962		114,269
Total operating expenses		194,927		195,725		202,453		197,237		790,342

Interest and other income		4,137		1,218		4,639		541		10,535
Interest expense		(16,768)		(11,894)		(9,223)		(13,794)		(51,679)
Income before income taxes		536		7,260		35,535		14,895		58,226
Income tax benefit (provision), net		863		(602)		(803)		(358)		(900)
Net income	$	1,399	$	6,658	$	34,732	$	14,537	$	57,326

Comparable Hotel Adjusted EBITDAre (2)	$	49,855	$	54,009	$	76,458	$	64,410	$	244,732

Comparable Adjusted EBITDAre (3)	$	49,228	$	50,786	$	72,382	$	59,026	$	231,422

Comparable Adjusted FFO attributable to common stockholders (4)	$	33,532	$	33,424	$	54,712	$	42,821	$	164,489

Comparable Adjusted FFO attributable to common stockholders per diluted share (4)	$	0.17	$	0.16	$	0.27	$	0.21	$	0.81

*Footnotes on page 11


COMPARABLE CORPORATE FINANCIAL INFORMATION			Page 8

Supplemental Financial Information February 23, 2024

Comparable Consolidated Statements of Operations

Q4 2022 – Q1 2022, FY 2022


	Quarter Ended (1)								Year Ended (1)
(Unaudited and in thousands, except per share data)	December 31,		September 30,		June 30,		March 31,		December 31,
	2022		2022		2022		2022		2022
Revenues
Room	$	129,986	$	137,416	$	147,687	$	108,120	$	523,209
Food and beverage		58,095		57,568		66,941		40,933		223,537
Other operating		29,248		20,322		17,049		23,335		89,954
Total revenues		217,329		215,306		231,677		172,388		836,700

Operating Expenses
Room		32,462		31,931		32,351		26,566		123,310
Food and beverage		42,883		42,714		43,570		31,821		160,988
Other expenses		76,826		80,170		79,290		68,682		304,968
Corporate overhead		7,936		7,879		8,717		10,714		35,246
Depreciation and amortization		27,985		27,333		27,232		27,220		109,770
Impairment loss		3,466		—		—		—		3,466
Total operating expenses		191,558		190,027		191,160		165,003		737,748

Interest and other income		476		270		116		4,380		5,242
Interest expense		(11,717)		(9,269)		(5,938)		(4,964)		(31,888)
Loss on extinguishment of debt		—		(784)		—		(230)		(1,014)
Income before income taxes		14,530		15,496		34,695		6,571		71,292
Income tax (provision) benefit, net		(485)		290		(28)		(136)		(359)
Net income	$	14,045	$	15,786	$	34,667	$	6,435	$	70,933

Comparable Hotel Adjusted EBITDAre (2)	$	54,084	$	60,336	$	77,779	$	44,907	$	237,106

Comparable Adjusted EBITDAre (3)	$	60,995	$	54,762	$	70,502	$	39,323	$	225,582

Comparable Adjusted FFO attributable to common stockholders (4)	$	45,951	$	42,178	$	59,522	$	28,403	$	176,054

Comparable Adjusted FFO attributable to common stockholders per diluted share (4)	$	0.23	$	0.21	$	0.29	$	0.14	$	0.87

*Footnotes on page 11


COMPARABLE CORPORATE FINANCIAL INFORMATION			Page 9

Supplemental Financial Information February 23, 2024

Comparable Consolidated Statements of Operations

Q4 2019 – Q1 2019, FY 2019


	Quarter Ended (1)								Year Ended (1)
(Unaudited and in thousands, except per share data)	December 31,		September 30,		June 30,		March 31,		December 31,
	2019		2019		2019		2019		2019
Revenues
Room	$	123,187	$	123,008	$	131,292	$	128,712	$	506,199
Food and beverage		52,480		47,576		60,233		58,709		218,998
Other operating		15,768		15,722		14,593		13,847		59,930
Total revenues		191,435		186,306		206,118		201,268		785,127

Operating Expenses
Room		30,528		30,968		31,093		30,633		123,222
Food and beverage		35,894		34,713		37,949		37,908		146,464
Other expenses		65,439		63,171		65,606		65,856		260,072
Corporate overhead		7,275		7,395		8,078		7,516		30,264
Depreciation and amortization		23,715		23,818		23,227		23,095		93,855
Total operating expenses		162,851		160,065		165,953		165,008		653,877

Interest and other income		3,060		3,762		4,811		4,924		16,557
Interest expense		(6,880)		(9,074)		(11,634)		(10,149)		(37,737)
Income before income taxes		24,764		20,929		33,342		31,035		110,070
Income tax (provision) benefit, net		(1,034)		749		(2,676)		3,112		151
Net income	$	23,730	$	21,678	$	30,666	$	34,147	$	110,221

Comparable Hotel Adjusted EBITDAre (2)	$	59,672	$	57,489	$	71,534	$	67,146	$	255,841

Comparable Adjusted EBITDAre (3)	$	57,179	$	55,647	$	69,881	$	66,498	$	249,205

*Footnotes on page 11


COMPARABLE CORPORATE FINANCIAL INFORMATION			Page 10

Supplemental Financial Information February 23, 2024

Comparable Consolidated Statements of Operations

Footnotes

(1)	Excludes results for the Courtyard by Marriott Los Angeles, the Renaissance Harborplace, the Renaissance Los Angeles Airport, the Renaissance Westchester, the Embassy Suites La Jolla and the Hyatt Centric Chicago Magnificent Mile sold in October 2019, July 2020, December 2020, October 2021, December 2021 and February 2022, respectively, along with the Embassy Suites Chicago and the Hilton Garden Inn Chicago Downtown/Magnificent Mile sold in March 2022 and the Boston Park Plaza sold in October 2023. Also excludes results and the gain on extinguishment of debt due to the resolution of potential employee-related obligations for the Hilton Times Square in connection with the assignment-in-lieu agreement executed in December 2020 between the Company and the hotel’s mortgage holder which transferred the Company’s leasehold interest in the hotel to the mortgage holder, and the elimination of interest expense on the mortgage loan secured by the Renaissance Washington DC (now The Westin Washington, DC Downtown) due to its repayment in December 2020. Includes prior ownership results for The Confidante Miami Beach acquired by the Company in June 2022, adjusted for the Company's pro forma depreciation expense.
(2)	Comparable Hotel Adjusted EBITDAre reconciliations for the fourth quarters and years included in this presentation can be found in the following pages. Additional details can be found in our earnings release, furnished in Exhibit 99.1 to our 8-K filed on February 23, 2024. Comparable Hotel Adjusted EBITDAre presented for the four quarters and years ended December 31, 2023 and 2022 includes all hotels owned by the Company as of December 31, 2023. Comparable Hotel Adjusted EBITDAre presented for the four quarters and year ended December 31, 2019 excludes the Montage Healdsburg and the Four Seasons Resort Napa Valley, which were acquired in April 2021 and December 2021, respectively. Both the Montage Healdsburg and the Four Seasons Resort Napa Valley were newly-developed hotels that were not open in 2019.
---	---
(3)	Comparable Adjusted EBITDAre reconciliations for each of the quarters and years included in this presentation can be found in the following pages and reflect the adjustments noted in Footnote 1 above, along with the elimination of noncontrolling interest due to the Company's acquisition of the outside 25% ownership interest in the joint venture that owned the Hilton San Diego Bayfront in June 2022.
---	---
(4)	Comparable Adjusted FFO attributable to common stockholders and Comparable Adjusted FFO attributable to common stockholders per diluted share reconciliations for each of the quarters and years included in this presentation can be found in the following pages and reflect the adjustments noted in Footnotes 1 and 3 above, along with repurchases totaling 10.2 million and 6.0 million shares of common stock in 2022 and 2023, respectively.
---	---


COMPARABLE CORPORATE FINANCIAL INFORMATION			Page 11

Supplemental Financial Information February 23, 2024

Comparable Reconciliation of Net Income to EBITDAre and Adjusted EBITDAre

Q4 2023 – Q1 2023, FY 2023


	Quarter Ended								Year Ended
	December 31,		September 30,		June 30,		March 31,		December 31,
(In thousands)	2023		2023		2023		2023		2023

Net income	$	126,985	$	15,558	$	43,078	$	21,087	$	206,708
Operations held for investment:
Depreciation and amortization		29,135		33,188		32,397		32,342		127,062
Interest expense		16,768		11,894		9,223		13,794		51,679
Income tax provision, net		2,799		602		803		358		4,562
Gain on sale of assets		(123,820)		—		—		—		(123,820)
EBITDAre		51,867		61,242		85,501		67,581		266,191

Operations held for investment:
Amortization of deferred stock compensation		2,512		2,511		3,325		2,427		10,775
Amortization of right-of-use assets and obligations		(20)		(13)		(17)		(52)		(102)
Amortization of contract intangibles, net		—		(19)		(18)		(18)		(55)
Gain on extinguishment of debt		(8)		(9)		(12)		(9,909)		(9,938)
Hurricane-related insurance restoration proceeds		—		—		(3,722)		—		(3,722)
Property-level severance		297		—		—		—		297
Adjustments to EBITDAre, net		2,781		2,470		(444)		(7,552)		(2,745)

Adjusted EBITDAre		54,648		63,712		85,057		60,029		263,446
Sold hotel Adjusted EBITDAre (1)		(5,420)		(12,926)		(12,675)		(1,003)		(32,024)

Comparable Adjusted EBITDAre	$	49,228	$	50,786	$	72,382	$	59,026	$	231,422

*Footnotes on page 13


COMPARABLE CORPORATE FINANCIAL INFORMATION			Page 12

Supplemental Financial Information February 23, 2024

Comparable Reconciliation of Net Income to FFO and Adjusted FFO Attributable to Common Stockholders

Q4 2023 – Q1 2023, FY 2023


	Quarter Ended								Year Ended
	December 31,		September 30,		June 30,		March 31,		December 31,
(In thousands, except per share data)	2023		2023		2023		2023		2023

Net income	$	126,985	$	15,558	$	43,078	$	21,087	$	206,708
Preferred stock dividends		(3,226)		(3,226)		(3,768)		(3,768)		(13,988)
Operations held for investment:
Real estate depreciation and amortization		28,979		33,025		32,240		32,191		126,435
Gain on sale of assets		(123,820)		—		—		—		(123,820)
FFO attributable to common stockholders		28,918		45,357		71,550		49,510		195,335

Operations held for investment:
Amortization of deferred stock compensation		2,512		2,511		3,325		2,427		10,775
Real estate amortization of right-of-use assets and obligations		(134)		(124)		(128)		(119)		(505)
Amortization of contract intangibles, net		105		84		85		83		357
Noncash interest on derivatives, net		3,600		(1,469)		(3,711)		1,832		252
Gain on extinguishment of debt		(8)		(9)		(12)		(9,909)		(9,938)
Hurricane-related insurance restoration proceeds		—		—		(3,722)		—		(3,722)
Property-level severance		297		—		—		—		297
Income tax related to hotel disposition		3,662		—		—		—		3,662
Adjustments to FFO attributable to common stockholders, net		10,034		993		(4,163)		(5,686)		1,178

Adjusted FFO attributable to common stockholders		38,952		46,350		67,387		43,824		196,513
Sold hotel Adjusted FFO (1)		(5,420)		(12,926)		(12,675)		(1,003)		(32,024)

Comparable Adjusted FFO attributable to common stockholders	$	33,532	$	33,424	$	54,712	$	42,821	$	164,489

Comparable Adjusted FFO attributable to common stockholders per diluted share	$	0.17	$	0.16	$	0.27	$	0.21	$	0.81

Basic weighted average shares outstanding		203,612		205,570		206,181		207,035		205,590
Shares associated with unvested restricted stock awards		613		411		733		501		508
Diluted weighted average shares outstanding		204,225		205,981		206,914		207,536		206,098
Equity transactions (2)		(1,164)		(3,123)		(3,764)		(4,833)		(3,211)
Comparable diluted weighted average shares outstanding		203,061		202,858		203,150		202,703		202,887

(1)	Sold hotel Adjusted EBITDAre and Adjusted FFO include results for the Boston Park Plaza sold in October 2023.
(2)	Equity transactions represent repurchases totaling 2.0 million, 0.3 million, 1.6 million and 2.1 million shares of common stock in the first, second, third and fourth quarters of 2023, respectively.
---	---


COMPARABLE CORPORATE FINANCIAL INFORMATION			Page 13

Supplemental Financial Information February 23, 2024

Comparable Reconciliation of Net Income to EBITDAre and Adjusted EBITDAre ****

Q4 2022 – Q1 2022, FY 2022


	Quarter Ended								Year Ended
	December 31,		September 30,		June 30,		March 31,		December 31,
(In thousands)	2022		2022		2022		2022		2022

Net income	$	17,463	$	20,488	$	37,692	$	15,123	$	90,766
Operations held for investment:
Depreciation and amortization		32,393		31,750		30,893		31,360		126,396
Interest expense		11,717		9,269		5,938		5,081		32,005
Income tax provision (benefit), net		485		(290)		28		136		359
Gain on sale of assets		—		—		—		(22,946)		(22,946)
Impairment loss - depreciable assets		1,379		—		—		—		1,379
EBITDAre		63,437		61,217		74,551		28,754		227,959

Operations held for investment:
Amortization of deferred stock compensation		2,230		2,230		2,853		3,578		10,891
Amortization of right-of-use assets and obligations		(359)		(350)		(354)		(346)		(1,409)
Amortization of contract intangibles, net		(18)		(19)		(18)		(6)		(61)
Finance lease obligation interest - cash ground rent		—		—		—		(117)		(117)
(Gain) loss on extinguishment of debt, net		(26)		770		(21)		213		936
Hurricane-related losses net of insurance restoration proceeds		—		—		138		(2,893)		(2,755)
Property-level severance		729		—		—		—		729
Costs associated with financing no longer pursued		697		—		—		—		697
Impairment loss - right-of-use asset		2,087		—		—		—		2,087
Noncontrolling interest:
Income from consolidated joint venture attributable to noncontrolling interest		—		—		(2,343)		(1,134)		(3,477)
Depreciation and amortization		—		—		(666)		(790)		(1,456)
Interest expense		—		—		(206)		(168)		(374)
Amortization of right-of-use asset and obligation		—		—		60		72		132
Adjustments to EBITDAre, net		5,340		2,631		(557)		(1,591)		5,823

Adjusted EBITDAre, excluding noncontrolling interest		68,777		63,848		73,994		27,163		233,782
Sold hotel Adjusted EBITDAre (1)		(7,782)		(9,086)		(9,529)		4,392		(22,005)
Acquisition hotel Adjusted EBITDAre (2)		—		—		6,037		7,768		13,805

Comparable Adjusted EBITDAre	$	60,995	$	54,762	$	70,502	$	39,323	$	225,582

*Footnotes on page 16


COMPARABLE CORPORATE FINANCIAL INFORMATION			Page 14

Supplemental Financial Information February 23, 2024

Comparable Reconciliation of Net Income to FFO and Adjusted FFO Attributable to Common Stockholders

Q4 2022 – Q1 2022, FY 2022


	Quarter Ended								Year Ended
	December 31,		September 30,		June 30,		March 31,		December 31,
(In thousands, except per share data)	2022		2022		2022		2022		2022

Net income	$	17,463	$	20,488	$	37,692	$	15,123	$	90,766
Preferred stock dividends		(3,350)		(3,351)		(3,773)		(3,773)		(14,247)
Operations held for investment:
Real estate depreciation and amortization		32,023		31,313		30,456		31,027		124,819
Gain on sale of assets		—		—		—		(22,946)		(22,946)
Noncontrolling interest:
Income from consolidated joint venture attributable to noncontrolling interest		—		—		(2,343)		(1,134)		(3,477)
Real estate depreciation and amortization		—		—		(666)		(790)		(1,456)
FFO attributable to common stockholders		46,136		48,450		61,366		17,507		173,459

Operations held for investment:
Amortization of deferred stock compensation		2,230		2,230		2,853		3,578		10,891
Real estate amortization of right-of-use assets and obligations		(287)		(288)		(294)		(286)		(1,155)
Amortization of contract intangibles, net		78		141		143		60		422
Noncash interest on derivatives, net		710		(39)		(1,023)		(1,842)		(2,194)
(Gain) loss on extinguishment of debt, net		(26)		770		(21)		213		936
Hurricane-related losses net of insurance restoration proceeds		—		—		138		(2,893)		(2,755)
Property-level severance		729		—		—		—		729
Costs associated with financing no longer pursued		697		—		—		—		697
Impairment losses - right-of-use and depreciable assets		3,466		—		—		—		3,466
Noncontrolling interest:
Real estate amortization of right-of-use asset and obligation		—		—		60		72		132
Noncash interest on derivatives, net		—		—		(2)		2		—
Adjustments to FFO attributable to common stockholders, net		7,597		2,814		1,854		(1,096)		11,169

Adjusted FFO attributable to common stockholders		53,733		51,264		63,220		16,411		184,628
Sold hotel Adjusted FFO (1)		(7,782)		(9,086)		(9,529)		4,392		(22,005)
Acquisition hotel Adjusted FFO (2)		—		—		5,831		7,600		13,431

Comparable Adjusted FFO attributable to common stockholders	$	45,951	$	42,178	$	59,522	$	28,403	$	176,054

Comparable Adjusted FFO attributable to common stockholders per diluted share	$	0.23	$	0.21	$	0.29	$	0.14	$	0.87

Basic weighted average shares outstanding		209,097		211,010		213,183		217,271		212,613
Shares associated with unvested restricted stock awards		449		594		354		305		358
Diluted weighted average shares outstanding		209,546		211,604		213,537		217,576		212,971
Equity transactions (3)		(7,037)		(8,950)		(11,139)		(15,475)		(10,623)
Comparable diluted weighted average shares outstanding		202,509		202,654		202,398		202,101		202,348

*Footnotes on page 16


COMPARABLE CORPORATE FINANCIAL INFORMATION			Page 15

Supplemental Financial Information February 23, 2024

Comparable Reconciliation of Net Income to EBITDAre**, Adjusted EBITDAre,**

FFO and Adjusted FFO Attributable to Common Stockholders

Q4 2022 – Q1 2022, FY 2022 Footnotes

(1)	Sold hotel Adjusted EBITDAre and Adjusted FFO include results for the Hyatt Centric Chicago Magnificent Mile sold in February 2022, along with the Embassy Suites Chicago and the Hilton Garden Inn Chicago Downtown/Magnificent Mile sold in March 2022 and the Boston Park Plaza sold in October 2023.
(2)	Acquisition hotel Adjusted EBITDAre and Adjusted FFO include prior ownership results for The Confidante Miami Beach acquired by the Company in June 2022, along with the elimination of noncontrolling interest due to the Company's acquisition of the outside 25% ownership interest in the joint venture that owned the Hilton San Diego Bayfront in June 2022.
---	---
(3)	Equity transactions represent repurchases totaling 3.9 million, 3.2 million, 0.9 million and 2.2 million shares of common stock in the first, second, third and fourth quarters of 2022, respectively, along with the repurchases of 2.0 million, 0.3 million, 1.6 million and 2.1 million shares of common stock in the first, second, third and fourth quarters of 2023, respectively.
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COMPARABLE CORPORATE FINANCIAL INFORMATION			Page 16

Supplemental Financial Information February 23, 2024

Comparable Reconciliation of Net Income to EBITDAre and Adjusted EBITDAre

Q4 2019 – Q1 2019, FY 2019


	Quarter Ended								Year Ended
	December 31,		September 30,		June 30,		March 31,		December 31,
(In thousands)	2019		2019		2019		2019		2019

Net income	$	45,414	$	33,545	$	45,918	$	17,916	$	142,793
Operations held for investment:
Depreciation and amortization		37,264		37,573		36,524		36,387		147,748
Interest expense		10,822		13,259		15,816		14,326		54,223
Income tax provision (benefit), net		1,034		(749)		2,676		(3,112)		(151)
Gain on sale of assets		(42,935)		—		—		—		(42,935)
Impairment loss		24,713		—		—		—		24,713
EBITDAre		76,312		83,628		100,934		65,517		326,391

Operations held for investment:
Amortization of deferred stock compensation		2,145		2,146		2,900		2,122		9,313
Amortization of right-of-use assets and obligations		(259)		(253)		(251)		(19)		(782)
Finance lease obligation interest - cash ground rent		(407)		(589)		(590)		(589)		(2,175)
Prior year property tax adjustments, net		(121)		(9)		109		189		168
Prior owner contingency funding		—		—		(900)		—		(900)
Noncontrolling interest:
Income from consolidated joint venture attributable to noncontrolling interest		(998)		(2,508)		(1,955)		(1,599)		(7,060)
Depreciation and amortization		(803)		(793)		(640)		(639)		(2,875)
Interest expense		(476)		(532)		(558)		(560)		(2,126)
Amortization of right-of-use asset and obligation		73		72		73		72		290
Adjustments to EBITDAre, net		(846)		(2,466)		(1,812)		(1,023)		(6,147)

Adjusted EBITDAre, excluding noncontrolling interest		75,466		81,162		99,122		64,494		320,244
Sold/Disposed hotel Adjusted EBITDAre (1)		(22,540)		(29,281)		(34,352)		(4,697)		(90,870)
Acquisition hotel Adjusted EBITDAre (2)		4,253		3,766		5,111		6,701		19,831

Comparable Adjusted EBITDAre	$	57,179	$	55,647	$	69,881	$	66,498	$	249,205

*Footnotes on Page 18


COMPARABLE CORPORATE FINANCIAL INFORMATION			Page 17

Supplemental Financial Information February 23, 2024

Comparable Reconciliation of Net Income to EBITDAre and Adjusted EBITDAre

Q4 2019 – Q1 2019, FY 2019 Footnotes

(1)

Sold/Disposed hotel Adjusted EBITDAre includes results for the Courtyard by Marriott Los Angeles, the Renaissance Harborplace, the Renaissance Los Angeles Airport, the Renaissance Westchester, the Embassy Suites La Jolla and the Hyatt Centric Chicago Magnificent Mile sold in October 2019, July 2020, December 2020, October 2021, December 2021 and February 2022, respectively, along with the Embassy Suites Chicago and Hilton Garden Inn Chicago Downtown/Magnificent Mile sold in March 2022 and the Boston Park Plaza sold in October 2023. In addition, includes results for the Hilton Times Square due to the assignment-in-lieu agreement executed in December 2020 between the Company and the hotel's mortgage holder, which transferred the Company's leasehold interest in the hotel to the mortgage holder.

(2)

Acquisition hotel Adjusted EBITDAre includes prior ownership results for The Confidante Miami Beach acquired by the Company in June 2022, along with the elimination of noncontrolling interest due to the Company's acquisition of the outside 25% ownership interest in the joint venture that owned the Hilton San Diego Bayfront in June 2022.

---


COMPARABLE CORPORATE FINANCIAL INFORMATION			Page 18


	Supplemental Financial Information February 23, 2024

CAPITALIZATION


CAPITALIZATION			Page 19

Supplemental Financial Information February 23, 2024

Comparative Capitalization Q4 2023 – Q4 2022


	December 31,			September 30,			June 30,			March 31,			December 31,
(In thousands, except per share data)	2023		****	2023		****	2023		****	2023		****	2022

Common Share Price & Dividends
At the end of the quarter	$	10.73		$	9.35		$	10.12		$	9.88		$	9.66
High during quarter ended	$	11.05		$	10.50		$	10.79		$	11.26		$	11.19
Low during quarter ended	$	9.04		$	8.67		$	9.39		$	8.87		$	9.42
Common dividends per share	$	0.13		$	0.07		$	0.05		$	0.05		$	0.05

Common Shares & Units
Common shares outstanding		203,480			205,623			207,185			207,410			209,320
Units outstanding		—			—			—			—			—
Total common shares and units outstanding		203,480			205,623			207,185			207,410			209,320

Capitalization ****
Market value of common equity	$	2,183,336		$	1,922,578		$	2,096,709		$	2,049,211		$	2,022,036
Liquidation value of preferred equity - Series G		66,250			66,250			66,250			66,250			66,250
Liquidation value of preferred equity - Series H		115,000			115,000			115,000			115,000			115,000
Liquidation value of preferred equity - Series I		100,000			100,000			100,000			100,000			100,000
Total debt		819,050			819,582			820,100			815,612			816,136
Total capitalization	$	3,283,636		$	3,023,410		$	3,198,059		$	3,146,073		$	3,119,422

Total debt to total capitalization		24.9	%		27.1	%		25.6	%		25.9	%		26.2	%
Total debt and preferred equity to total capitalization		33.5	%		36.4	%		34.4	%		34.9	%		35.2	%


CAPITALIZATION			Page 20

Supplemental Financial Information February 23, 2024

Debt Summary Schedule


(In thousands)				Interest Rate /		Maturity			December 31, 2023
Debt	****	Collateral	****	Spread	****	Date (1)			Balance

Secured Mortgage Debt		JW Marriott New Orleans		4.15%		12/11/2024		$	74,050
Series A Senior Notes		Unsecured		4.69%		01/10/2026			65,000
Term Loan 3 (2)		Unsecured		6.81%		05/01/2026			225,000
Term Loan 1 (3)		Unsecured		5.25%		07/25/2027			175,000
Revolving Line of Credit		Unsecured		Adj. SOFR + 1.40%		07/25/2027			—
Series B Senior Notes		Unsecured		4.79%		01/10/2028			105,000
Term Loan 2 (3)		Unsecured		6.77%		01/25/2028			175,000

Total Debt								$	819,050

Preferred Stock
Series G cumulative redeemable preferred (4)				1.878%		perpetual		$	66,250
Series H cumulative redeemable preferred				6.125%		perpetual			115,000
Series I cumulative redeemable preferred				5.70%		perpetual			100,000
Total Preferred Stock								$	281,250

Debt and Preferred Statistics
						Debt Statistics			Debt and Preferred Statistics
% Fixed Rate Debt						51.2	%		63.6	%
% Floating Rate Debt						48.8	%		36.4	%
Average Interest Rate						5.80	%		5.59	%
Weighted Average Maturity of Debt						3.0 years			N/A

(1)	Maturity Date assumes the exercise of all available extensions for the Revolving Line of Credit and Term Loan 3. By extending these loans, the Company's weighted average maturity of debt increases from 2.8 years to 3.0 years.
(2)	In May 2023, the Company entered into a new $225.0 million term loan agreement ("Term Loan 3"). Interest rates on Term Loan 3 are calculated on a leverage-based pricing grid ranging from 135 to 220 basis points over the applicable adjusted term SOFR. Term Loan 3 has an initial term of two years with one 12-month extension, which would result in an extended maturity of May 2026.
---	---
(3)	Pursuant to the Second Amended Credit Agreement, interest rates on Term Loan 1 and Term Loan 2 are calculated on a leverage-based pricing grid ranging from 135 to 220 basis points over the applicable adjusted term SOFR. In May 2023, the pricing grid was reduced by 0.02% to a range of 133 to 218 basis points as the Company achieved the 2022 sustainability performance metric specified in the Second Amended Credit Agreement. The reduction in the pricing grid will be evaluated annually and is subject to the Company's continued ability to satisfy its sustainability metric. The interest rate for Term Loan 1 includes the effects of the Company's interest rate derivative swaps.
---	---
(4)	The Series G cumulative redeemable preferred stock has an initial dividend rate equal to the Montage Healdsburg's annual net operating income yield on the Company's investment in the resort. In 2023, the Company declared cash dividends of $0.469437 per share, which equates to an annual yield of 1.878%. The annual dividend rate may increase in 2024 to the greater of 3.0% or the rate equal to the Montage Healdsburg's annual net operating income yield on the Company's total investment in the resort.
---	---


CAPITALIZATION			Page 21

Supplemental Financial Information February 23, 2024

PROPERTY-LEVEL DATA AND OPERATING STATISTICS


PROPERTY-LEVEL DATA AND OPERATING STATISTICS			Page 22

Supplemental Financial Information February 23, 2024

Hotel Information as of February 23, 2024


Hotel		****	Location	****	Brand	****	Number of Rooms	****	% of Total Rooms	****	Interest	****	Year Acquired

1	Hilton San Diego Bayfront (1) (2)		California		Hilton		1,190		18%		Leasehold		2011 / 2022
2	Hyatt Regency San Francisco		California		Hyatt		821		12%		Fee Simple		2013
3	The Westin Washington, DC Downtown		Washington DC		Marriott		807		12%		Fee Simple		2005
4	Renaissance Orlando at SeaWorld®		Florida		Marriott		781		12%		Fee Simple		2005
5	Wailea Beach Resort		Hawaii		Marriott		547		8%		Fee Simple		2014
6	JW Marriott New Orleans (3)		Louisiana		Marriott		501		8%		Fee Simple		2011
7	Marriott Boston Long Wharf		Massachusetts		Marriott		415		6%		Fee Simple		2007
8	Renaissance Long Beach		California		Marriott		374		6%		Fee Simple		2005
9	The Confidante Miami Beach		Florida		Hyatt		339		5%		Fee Simple		2022
10	The Bidwell Marriott Portland		Oregon		Marriott		258		4%		Fee Simple		2000
11	Hilton New Orleans St. Charles		Louisiana		Hilton		252		4%		Fee Simple		2013
12	Oceans Edge Resort & Marina		Florida		Independent		175		3%		Fee Simple		2017
13	Montage Healdsburg (4)		California		Montage		130		2%		Fee Simple		2021
14	Four Seasons Resort Napa Valley (4)		California		Four Seasons		85		1%		Fee Simple		2021

	Total Portfolio						6,675		100%

(1)	In June 2022, the Company acquired the 25.0% noncontrolling partner's ownership interest in the Hilton San Diego Bayfront. Following this acquisition, the Company owns 100% of the hotel.
(2)	The ground lease at the Hilton San Diego Bayfront matures in 2071.
---	---
(3)	Hotel is subject to a municipal airspace lease that matures in 2044 and applies only to certain balcony space that is not integral to the hotel’s operations.
---	---
(4)	The number of rooms excludes rooms provided by owners of the separately owned private residences at each resort who may periodically elect to participate in the residential rental program.
---	---


PROPERTY-LEVEL DATA AND OPERATING STATISTICS			Page 23

Supplemental Financial Information February 23, 2024

Property-Level Operating Statistics

ADR, Occupancy and RevPAR

Q4 2023/2022/2019


	ADR								Occupancy								RevPAR
Hotels sorted by number of rooms	For the Quarter Ended December 31,								For the Quarter Ended December 31,							For the Quarter Ended December 31,
	2023		****	2022		2019	****	2023 vs. 2022	2023	****	2022	2019	****	2023 vs. 2022		2023		****	2022			2019	****	2023 vs. 2022
Hilton San Diego Bayfront	$	252.87	$	257.63	$	217.65		(1.8)%	76.0%		76.0%	82.4%		—	bps	$	192.18		$	195.80	$	179.34		(1.8)%
Hyatt Regency San Francisco (1)		307.42		280.82		319.68		9.5%	66.6%		67.7%	88.2%		(110)	bps		204.74			190.12		281.96		7.7%
The Westin Washington, DC Downtown (1)		278.61		239.25		238.17		16.5%	58.4%		44.2%	73.4%		1,420	bps		162.71			105.75		174.82		53.9%
Renaissance Orlando at SeaWorld®		180.45		185.85		174.42		(2.9)%	60.4%		65.1%	81.2%		(470)	bps		108.99			120.99		141.63		(9.9)%
Wailea Beach Resort		699.17		727.99		505.64		(4.0)%	72.4%		72.9%	89.8%		(50)	bps		506.20			530.70		454.06		(4.6)%
JW Marriott New Orleans		242.76		255.19		208.88		(4.9)%	66.3%		70.1%	82.6%		(380)	bps		160.95			178.89		172.53		(10.0)%
Marriott Boston Long Wharf		380.01		358.07		314.91		6.1%	71.2%		69.7%	84.4%		150	bps		270.57			249.57		265.78		8.4%
Renaissance Long Beach (1)		210.35		204.42		179.29		2.9%	49.0%		68.3%	77.8%		(1,930)	bps		103.07			139.62		139.49		(26.2)%
The Bidwell Marriott Portland		155.55		162.34		170.52		(4.2)%	52.6%		41.3%	65.1%		1,130	bps		81.82			67.05		111.01		22.0%
Hilton New Orleans St. Charles		184.50		195.89		172.91		(5.8)%	71.4%		73.7%	67.8%		(230)	bps		131.73			144.37		117.23		(8.8)%
Oceans Edge Resort & Marina		315.40		368.16		233.25		(14.3)%	76.6%		66.3%	84.4%		1,030	bps		241.60			244.09		196.86		(1.0)%

11 Hotel Portfolio (2)		300.73		298.18		259.24		0.9%	66.2%		65.8%	81.1%		40	bps		199.08			196.20		210.24		1.5%

Montage Healdsburg		1,043.74		1,128.82		N/A		(7.5)%	47.9%		46.7%	N/A		120	bps		499.95			527.16		N/A		(5.2)%
Four Seasons Resort Napa Valley		1,484.28		1,838.15		N/A		(19.3)%	40.8%		45.3%	N/A		(450)	bps		605.59			832.68		N/A		(27.3)%

Comparable Portfolio, Excluding Renovation Hotel (3)		322.91		325.75		N/A		(0.9)%	65.4%		65.1%	N/A		30	bps		211.18			212.06		N/A		(0.4)%

Add: Renovation Hotel (1)
The Confidante Miami Beach		223.71		286.17		188.50		(21.8)%	53.0%		69.4%	81.0%		(1,640)	bps		118.57			198.60		152.69		(40.3)%

Comparable Portfolio (4)	$	318.80	$	323.62		N/A		(1.5)%	64.8%		65.3%	N/A		(50)	bps	$	206.58		$	211.32		N/A		(2.2)%

*Footnotes on page 27


PROPERTY-LEVEL DATA AND OPERATING STATISTICS			Page 24

Supplemental Financial Information February 23, 2024

Property-Level Operating Statistics

ADR, Occupancy and RevPAR

2023/2022/2019


	ADR								Occupancy								RevPAR
Hotels sorted by number of rooms	For the Year Ended December 31,								For the Year Ended December 31,							For the Year Ended December 31,
	2023		****	2022		2019	****	2023 vs. 2022	2023	****	2022	2019	****	2023 vs. 2022		2023		****	2022			2019	****	2023 vs. 2022
Hilton San Diego Bayfront (1)	$	275.56	$	270.47	$	247.20		1.9%	82.8%		76.6%	81.4%		620	bps	$	228.16		$	207.18	$	201.22		10.1%
Hyatt Regency San Francisco (1)		302.07		267.52		322.08		12.9%	69.6%		58.5%	89.0%		1,110	bps		210.24			156.50		286.65		34.3%
The Westin Washington, DC Downtown (1)		264.81		241.85		232.64		9.5%	56.7%		49.7%	78.1%		700	bps		150.15			120.20		181.69		24.9%
Renaissance Orlando at SeaWorld®		192.39		184.16		168.18		4.5%	70.4%		67.2%	78.9%		320	bps		135.44			123.76		132.69		9.4%
Wailea Beach Resort		691.03		694.73		478.47		(0.5)%	75.6%		79.2%	91.2%		(360)	bps		522.42			550.23		436.36		(5.1)%
JW Marriott New Orleans		240.59		238.68		206.47		0.8%	69.6%		62.0%	83.9%		760	bps		167.45			147.98		173.23		13.2%
Marriott Boston Long Wharf		380.88		375.26		332.29		1.5%	73.6%		66.8%	86.7%		680	bps		280.33			250.67		288.10		11.8%
Renaissance Long Beach (1)		222.74		208.11		189.85		7.0%	71.3%		73.2%	81.6%		(190)	bps		158.81			152.34		154.92		4.2%
The Bidwell Marriott Portland		168.78		169.24		186.05		(0.3)%	55.7%		47.2%	80.1%		850	bps		94.01			79.88		149.03		17.7%
Hilton New Orleans St. Charles		182.29		184.84		169.29		(1.4)%	68.2%		60.5%	74.3%		770	bps		124.32			111.83		125.78		11.2%
Oceans Edge Resort & Marina (1)		354.61		432.83		242.04		(18.1)%	76.6%		73.9%	88.7%		270	bps		271.63			319.86		214.69		(15.1)%

11 Hotel Portfolio (2)		303.48		301.18		262.95		0.8%	71.0%		65.6%	83.0%		540	bps		215.47			197.57		218.25		9.1%

Montage Healdsburg		1,065.10		1,103.21		N/A		(3.5)%	52.5%		54.4%	N/A		(190)	bps		559.18			600.15		N/A		(6.8)%
Four Seasons Resort Napa Valley		1,512.81		1,778.25		N/A		(14.9)%	45.2%		45.2%	N/A		—	bps		683.79			803.77		N/A		(14.9)%

Comparable Portfolio, Excluding Renovation Hotel (3)		326.76		329.39		N/A		(0.8)%	70.3%		65.1%	N/A		520	bps		229.71			214.43		N/A		7.1%

Add: Renovation Hotel (1)
The Confidante Miami Beach		277.44		303.82		196.84		(8.7)%	60.7%		71.9%	80.3%		(1,120)	bps		168.41			218.45		158.06		(22.9)%

Comparable Portfolio (4)	$	324.58	$	327.97		N/A		(1.0)%	69.8%		65.4%	N/A		440	bps	$	226.56		$	214.49		N/A		5.6%

*Footnotes on page 27


PROPERTY-LEVEL DATA AND OPERATING STATISTICS			Page 25

Supplemental Financial Information February 23, 2024

Property-Level Operating Statistics

Total RevPAR (TRevPAR)

Q4 and FY 2023/2022/2019


Hotels sorted by number of rooms	For the Quarter Ended December 31,								For the Year Ended December 31,
	2023		2022		****	2019	****	2023 vs. 2022	2023		2022		****	2019		****	2023 vs. 2022
Hilton San Diego Bayfront (1)	$	377.77	$	382.49	$	312.85		(1.2)%	$	422.92	$	370.75		$	351.61		14.1%
Hyatt Regency San Francisco (1)		306.08		279.31		422.60		9.6%		302.02		229.18			411.48		31.8%
The Westin Washington, DC Downtown (1)		269.88		176.91		274.20		52.6%		229.60		188.76			287.84		21.6%
Renaissance Orlando at SeaWorld®		255.99		255.18		293.84		0.3%		305.93		273.15			293.61		12.0%
Wailea Beach Resort		731.36		727.78		625.99		0.5%		759.04		794.50			617.62		(4.5)%
JW Marriott New Orleans		232.57		230.95		231.70		0.7%		232.35		188.88			229.00		23.0%
Marriott Boston Long Wharf		379.75		367.52		392.17		3.3%		391.88		351.50			406.92		11.5%
Renaissance Long Beach (1)		149.87		192.62		194.64		(22.2)%		211.30		198.91			214.49		6.2%
The Bidwell Marriott Portland		111.86		99.51		130.09		12.4%		130.21		110.23			171.95		18.1%
Hilton New Orleans St. Charles		152.51		163.82		132.51		(6.9)%		150.21		139.28			142.86		7.8%
Oceans Edge Resort & Marina (1)		381.11		366.79		299.74		3.9%		430.49		474.11			332.34		(9.2)%

11 Hotel Portfolio (2)		323.93		309.76		324.28		4.6%		342.35		308.94			336.30		10.8%

Montage Healdsburg		956.30		1,012.03		N/A		(5.5)%		1,027.20		1,077.98			N/A		(4.7)%
Four Seasons Resort Napa Valley		1,086.58		1,286.75		N/A		(15.6)%		1,253.57		1,293.83			N/A		(3.1)%

Comparable Portfolio, Excluding Renovation Hotel (3)		348.30		338.17		N/A		3.0%		369.99		338.61			N/A		9.3%

Add: Renovation Hotel (1)
The Confidante Miami Beach		152.17		321.57		282.05		(52.7)%		264.52		348.08			282.49		(24.0)%

Comparable Portfolio (4)	$	338.35	$	337.33		N/A		0.3%	$	364.64	$	339.09			N/A		7.5%

*Footnotes on page 27


PROPERTY-LEVEL DATA AND OPERATING STATISTICS			Page 26

Supplemental Financial Information February 23, 2024

Property-Level Operating Statistics

Q4 and FY 2023/2022/2019 Footnotes

(1)	Operating statistics for the fourth quarter and full year 2023 are impacted by renovation activity at Renaissance Long Beach, The Confidante Miami Beach and The Westin Washington, DC Downtown. During the fourth quarter 2023, the Company began a transformational renovation of The Confidante Miami Beach in preparation for its conversion to Andaz Miami Beach. Operating statistics for the fourth quarter and full year 2022 are impacted by renovation activity at Hyatt Regency San Francisco and The Westin Washington, DC Downtown. Operating statistics for full year 2019 are impacted by renovation activity at the Hilton San Diego Bayfront, the Hyatt Regency San Francisco and the Oceans Edge Resort & Marina.
(2)	The 11 Hotel Portfolio consists of the Comparable Portfolio, Excluding Renovation Hotel (defined below) and also excludes the Montage Healdsburg and the Four Seasons Resort Napa Valley, which were acquired in April 2021 and December 2021, respectively. Both the Montage Healdsburg and the Four Seasons Resort Napa Valley were newly-developed hotels that were not open in 2019.
---	---
(3)	Comparable Portfolio, Excluding Renovation Hotel includes all hotels owned by the Company as of December 31, 2023, with the exception of The Confidante Miami Beach due to its renovation activity during the fourth quarter 2023.
---	---
(4)	Comparable Portfolio consists of all hotels owned by the Company as of December 31, 2023. Comparable Portfolio presented for the fourth quarter 2019 and the full years 2022 and 2019 includes prior ownership results for The Confidante Miami Beach acquired by the Company in June 2022. The Company obtained prior ownership information from the prior owner of The Confidante Miami Beach during the due diligence period before acquiring the hotel. The Company performed a limited review of the information as part of its analysis of the acquisition.
---	---


PROPERTY-LEVEL DATA AND OPERATING STATISTICS			Page 27

Supplemental Financial Information February 23, 2024

PROPERTY-LEVEL REVENUES, ADJUSTED EBITDAre &

ADJUSTED EBITDAre MARGINS


PROPERTY-LEVEL REVENUES, ADJUSTED EBITDAre & ADJUSTED EBITDAre MARGINS			Page 28

Supplemental Financial Information February 23, 2024

Property-Level Revenues, Adjusted EBITDAre and Adjusted EBITDAre Margins

Q4 2023/2022


Hotels sorted by number of rooms	For the Quarter Ended December 31,
	2023								2022
(In thousands)							Hotel Adjusted								Hotel Adjusted		Hotel Adjusted
	Total			Hotel Adjusted			EBITDAre		Total			Hotel Adjusted			EBITDAre		EBITDAre
	Revenues		****	EBITDAre		****	Margins	****	Revenues		****	EBITDAre		****	Margins	****	Margin Change
Hilton San Diego Bayfront	$	41,358		$	11,484		27.8%		$	41,875		$	12,335		29.5%		(170)	bps
Hyatt Regency San Francisco (1)		23,120			2,786		12.1%			21,096			2,459		11.7%		40	bps
The Westin Washington, DC Downtown (1)		20,037			3,633		18.1%			13,135			1,351		10.3%		780	bps
Renaissance Orlando at SeaWorld®		18,394			4,774		26.0%			18,336			5,045		27.5%		(150)	bps
Wailea Beach Resort		36,804			14,244		38.7%			36,624			14,431		39.4%		(70)	bps
JW Marriott New Orleans		10,719			3,765		35.1%			10,645			4,262		40.0%		(490)	bps
Marriott Boston Long Wharf		14,499			5,320		36.7%			14,031			4,815		34.3%		240	bps
Renaissance Long Beach (1)		5,157			138		2.7%			6,627			1,568		23.7%		(2,100)	bps
The Bidwell Marriott Portland		2,655			285		10.7%			2,362			32		1.4%		930	bps
Hilton New Orleans St. Charles		3,535			1,229		34.8%			3,798			1,394		36.7%		(190)	bps
Oceans Edge Resort & Marina		6,136			1,996		32.5%			5,906			2,169		36.7%		(420)	bps
Montage Healdsburg		11,438			900		7.9%			12,104			1,511		12.5%		(460)	bps
Four Seasons Resort Napa Valley		9,497			(479)		(5.0)%			10,773			238		2.2%		(720)	bps

Comparable Portfolio, Excluding Renovation Hotel (2)		203,349			50,075		24.6%			197,312			51,610		26.2%		(160)	bps

Add: Renovation Hotel (1)
The Confidante Miami Beach		4,745			(220)		(4.6)%			10,030			2,474		24.7%		(2,930)	bps

Comparable Portfolio (3)		208,094			49,855		24.0%			207,342			54,084		26.1%		(210)	bps

Add: Sold Hotel (4)		11,131			5,420		48.7%			26,797			7,782		29.0%		N/A

Actual Portfolio (5)	$	219,225		$	55,275		25.2%		$	234,139		$	61,866		26.4%		(120)	bps

*Footnotes on page 33


PROPERTY-LEVEL REVENUES, ADJUSTED EBITDAre & ADJUSTED EBITDAre MARGINS			Page 29

Supplemental Financial Information February 23, 2024

Property-Level Revenues, Adjusted EBITDAre and Adjusted EBITDAre Margins

Q4 2023/2019


Hotels sorted by number of rooms	For the Quarter Ended December 31,
	2023								2019
(In thousands)							Hotel Adjusted								Hotel Adjusted		Hotel Adjusted
	Total			Hotel Adjusted			EBITDAre		Total			Hotel Adjusted			EBITDAre		EBITDAre
	Revenues		****	EBITDAre		****	Margins	****	Revenues		****	EBITDAre		****	Margins	****	Margin Change
Hilton San Diego Bayfront	$	41,358		$	11,484		27.8%		$	34,249		$	8,787		25.7%		210	bps
Hyatt Regency San Francisco		23,120			2,786		12.1%			31,798			8,363		26.3%		(1,420)	bps
The Westin Washington, DC Downtown (1)		20,037			3,633		18.1%			20,358			5,976		29.4%		(1,130)	bps
Renaissance Orlando at SeaWorld®		18,394			4,774		26.0%			21,113			7,463		35.3%		(930)	bps
Wailea Beach Resort		36,804			14,244		38.7%			31,502			12,424		39.4%		(70)	bps
JW Marriott New Orleans		10,719			3,765		35.1%			10,680			4,482		42.0%		(690)	bps
Marriott Boston Long Wharf		14,499			5,320		36.7%			14,973			5,455		36.4%		30	bps
Renaissance Long Beach (1)		5,157			138		2.7%			6,698			1,747		26.1%		(2,340)	bps
The Bidwell Marriott Portland		2,655			285		10.7%			2,980			762		25.6%		(1,490)	bps
Hilton New Orleans St. Charles		3,535			1,229		34.8%			3,072			729		23.7%		1,110	bps
Oceans Edge Resort & Marina		6,136			1,996		32.5%			4,826			1,435		29.7%		280	bps

11 Hotel Portfolio (6)		182,414			49,654		27.2%			182,249			57,623		31.6%		(440)	bps

Montage Healdsburg		11,438			900		7.9%			N/A			N/A		N/A		N/A
Four Seasons Resort Napa Valley		9,497			(479)		(5.0)%			N/A			N/A		N/A		N/A

Comparable Portfolio, Excluding Renovation Hotel (2)		203,349			50,075		24.6%			182,249			57,623		31.6%		N/A

Add: Renovation Hotel (1)
The Confidante Miami Beach		4,745			(220)		(4.6)%			9,186			2,049		22.3%		(2,690)	bps

Comparable Portfolio (3)		208,094			49,855		24.0%			191,435			59,672		31.2%		N/A

Less: Prior Ownership (7)
The Confidante Miami Beach		N/A			N/A		N/A			(9,186)			(2,049)		22.3%		N/A

Add: Sold/Disposed Hotels (4)		11,131			5,420		48.7%			90,681			22,540		24.9%		N/A

Actual Portfolio (5)	$	219,225		$	55,275		25.2%		$	272,930		$	80,163		29.4%		N/A

*Footnotes on page 33


PROPERTY-LEVEL REVENUES, ADJUSTED EBITDAre & ADJUSTED EBITDAre MARGINS			Page 30

Supplemental Financial Information February 23, 2024

Property-Level Revenues, Adjusted EBITDAre and Adjusted EBITDAre Margins

FY 2023/2022


Hotels sorted by number of rooms	For the Year Ended December 31,
	2023								2022
(In thousands)							Hotel Adjusted								Hotel Adjusted		Hotel Adjusted
	Total			Hotel Adjusted			EBITDAre		Total			Hotel Adjusted			EBITDAre		EBITDAre
	Revenues		****	EBITDAre		****	Margins	****	Revenues		****	EBITDAre		****	Margins	****	Margin Change
Hilton San Diego Bayfront	$	183,695		$	58,457		31.8%		$	161,035		$	52,560		32.6%		(80)	bps
Hyatt Regency San Francisco (1)		90,505			13,269		14.7%			68,677			5,737		8.4%		630	bps
The Westin Washington, DC Downtown (1)		67,630			12,019		17.8%			55,600			10,114		18.2%		(40)	bps
Renaissance Orlando at SeaWorld®		87,211			27,531		31.6%			77,866			23,770		30.5%		110	bps
Wailea Beach Resort		151,546			58,213		38.4%			158,625			65,972		41.6%		(320)	bps
JW Marriott New Orleans		42,489			16,269		38.3%			34,540			12,343		35.7%		260	bps
Marriott Boston Long Wharf		59,360			21,456		36.1%			53,243			18,974		35.6%		50	bps
Renaissance Long Beach (1)		28,844			7,098		24.6%			27,153			7,961		29.3%		(470)	bps
The Bidwell Marriott Portland		12,262			2,061		16.8%			10,380			1,563		15.1%		170	bps
Hilton New Orleans St. Charles		13,816			4,766		34.5%			12,811			4,471		34.9%		(40)	bps
Oceans Edge Resort & Marina		27,498			9,965		36.2%			30,284			11,975		39.5%		(330)	bps
Montage Healdsburg		48,741			5,214		10.7%			51,150			6,158		12.0%		(130)	bps
Four Seasons Resort Napa Valley		43,385			2,533		5.8%			42,279			3,087		7.3%		(150)	bps

Comparable Portfolio, Excluding Renovation Hotel (2)		856,982			238,851		27.9%			783,643			224,685		28.7%		(80)	bps

Add: Renovation Hotel (1)
The Confidante Miami Beach		32,730			5,881		18.0%			43,070			12,421		28.8%		(1,080)	bps

Comparable Portfolio (3)		889,712			244,732		27.5%			826,713			237,106		28.7%		(120)	bps

Less: Prior Ownership (7)
The Confidante Miami Beach		N/A			N/A		N/A			(22,637)			(8,630)		38.1%		N/A

Add: Sold Hotels (4)		96,713			32,024		33.1%			97,915			22,005		22.5%		N/A

Actual Portfolio (5)	$	986,425		$	276,756		28.1%		$	901,991		$	250,481		27.8%		N/A

*Footnotes on page 33


PROPERTY-LEVEL REVENUES, ADJUSTED EBITDAre & ADJUSTED EBITDAre MARGINS			Page 31

Supplemental Financial Information February 23, 2024

Property-Level Revenues, Adjusted EBITDAre and Adjusted EBITDAre Margins

FY 2023/2019


Hotels sorted by number of rooms	For the Year Ended December 31,
	2023								2019
(In thousands)							Hotel Adjusted								Hotel Adjusted		Hotel Adjusted
	Total			Hotel Adjusted			EBITDAre		Total			Hotel Adjusted			EBITDAre		EBITDAre
	Revenues		****	EBITDAre		****	Margins	****	Revenues		****	EBITDAre		****	Margins	****	Margin Change
Hilton San Diego Bayfront (1)	$	183,695		$	58,457		31.8%		$	152,719		$	46,996		30.8%		100	bps
Hyatt Regency San Francisco (1)		90,505			13,269		14.7%			121,322			32,647		26.9%		(1,220)	bps
The Westin Washington, DC Downtown (1)		67,630			12,019		17.8%			84,784			24,267		28.6%		(1,080)	bps
Renaissance Orlando at SeaWorld®		87,211			27,531		31.6%			83,699			28,858		34.5%		(290)	bps
Wailea Beach Resort		151,546			58,213		38.4%			123,311			49,440		40.1%		(170)	bps
JW Marriott New Orleans		42,489			16,269		38.3%			41,877			17,465		41.7%		(340)	bps
Marriott Boston Long Wharf		59,360			21,456		36.1%			61,638			23,225		37.7%		(160)	bps
Renaissance Long Beach (1)		28,844			7,098		24.6%			29,280			8,973		30.6%		(600)	bps
The Bidwell Marriott Portland		12,262			2,061		16.8%			15,628			5,871		37.6%		(2,080)	bps
Hilton New Orleans St. Charles		13,816			4,766		34.5%			13,140			3,463		26.4%		810	bps
Oceans Edge Resort & Marina (1)		27,498			9,965		36.2%			21,228			6,576		31.0%		520	bps

11 Hotel Portfolio (6)		764,856			231,104		30.2%			748,626			247,781		33.1%		(290)	bps

Montage Healdsburg		48,741			5,214		10.7%			N/A			N/A		N/A		N/A
Four Seasons Resort Napa Valley		43,385			2,533		5.8%			N/A			N/A		N/A		N/A

Comparable Portfolio, Excluding Renovation Hotel (2)		856,982			238,851		27.9%			748,626			247,781		33.1%		N/A

Add: Renovation Hotel (1)
The Confidante Miami Beach		32,730			5,881		18.0%			36,501			8,060		22.1%		(410)	bps

Comparable Portfolio (3)		889,712			244,732		27.5%			785,127			255,841		32.6%		N/A

Less: Prior Ownership (7)
The Confidante Miami Beach		N/A			N/A		N/A			(36,501)			(8,060)		22.1%		N/A

Add: Sold/Disposed Hotels (4)		96,713			32,024		33.1%			366,449			90,870		24.8%		N/A

Actual Portfolio (5)	$	986,425		$	276,756		28.1%		$	1,115,075		$	338,651		30.4%		N/A

*Footnotes on page 33


PROPERTY-LEVEL REVENUES, ADJUSTED EBITDAre & ADJUSTED EBITDAre MARGINS			Page 32

Supplemental Financial Information February 23, 2024

Property-Level Revenues, Adjusted EBITDAre and Adjusted EBITDAre Margins

Q4 and FY 2023/2022/2019 Footnotes

(1)	Hotel Adjusted EBITDAre for the fourth quarter and full year 2023 is impacted by renovation activity at Renaissance Long Beach, The Confidante Miami Beach and The Westin Washington, DC Downtown. During the fourth quarter 2023, the Company began a transformational renovation of The Confidante Miami Beach in preparation for its conversion to Andaz Miami Beach. Adjusted EBITDAre for the fourth quarter and full year 2022 is impacted by renovation activity at Hyatt Regency San Francisco and The Westin Washington, DC Downtown. Hotel Adjusted EBITDAre for the full year 2019 is impacted by renovation activity at the Hilton San Diego Bayfront, the Hyatt Regency San Francisco and the Oceans Edge Resort & Marina.
(2)	Comparable Portfolio, Excluding Renovation Hotel includes all hotels owned by the Company as of December 31, 2023, with the exception of The Confidante Miami Beach due to its renovation activity during the fourth quarter 2023.
---	---
(3)	Comparable Portfolio consists of all hotels owned by the Company as of December 31, 2023. Comparable Portfolio presented for the fourth quarter 2019 and the full years 2022 and 2019 includes prior ownership results for The Confidante Miami Beach acquired by the Company in June 2022. The Company obtained prior ownership information from the prior owner of The Confidante Miami Beach during the due diligence period before acquiring the hotel. The Company performed a limited review of the information as part of its analysis of the acquisition.
---	---
(4)	Sold Hotels for all periods presented include the Boston Park Plaza sold in October 2023. Sold Hotels for the full year 2022 and the fourth quarter and full year 2019 include results for the Hyatt Centric Chicago Magnificent Mile sold in February 2022, and the Embassy Suites Chicago and Hilton Garden Inn Chicago Downtown/Magnificent Mile sold in March 2022. Sold/Disposed Hotels for the fourth quarter and full year 2019 also include results for the Embassy Suites La Jolla and the Renaissance Westchester sold in December 2021 and October 2021, respectively, the Renaissance Los Angeles Airport sold in December 2020, the Hilton Times Square assigned to its mortgage holder in December 2020, the Renaissance Harborplace sold in July 2020, and the Courtyard by Marriott Los Angeles sold in October 2019.
---	---
(5)	Actual Portfolio includes results for the 15 hotels owned by the Company during the fourth quarter and full year 2023, the 15 hotels and 18 hotels owned by the Company during the fourth quarter and full year 2022, respectively, and the 21 hotels owned by the Company during the fourth quarter and full year 2019.
---	---
(6)	The 11 Hotel Portfolio consists of the Comparable Portfolio, Excluding Renovation Hotel and also excludes the Montage Healdsburg and the Four Seasons Resort Napa Valley, which were acquired in April 2021 and December 2021, respectively. Both the Montage Healdsburg and the Four Seasons Resort Napa Valley were newly-developed hotels that were not open in 2019.
---	---
(7)	Prior Ownership includes results for The Confidante Miami Beach prior to the Company’s acquisition of the hotel in June 2022.
---	---


PROPERTY-LEVEL REVENUES, ADJUSTED EBITDAre & ADJUSTED EBITDAre MARGINS			Page 33