Acquisition of Hotel Properties

12 Months Ended

Dec. 31, 2018

Hotel Purchase Price Allocation

We acquired the Residence Inn Summerville ("RI Summerville") hotel in Summerville, SC for $20.8 million on August 27, 2018, the Dallas Downtown Courtyard ("Dallas DT") hotel in Dallas, TX for $49.0 million on December 5, 2018, the Hilton Garden Inn Portsmouth ("Portsmouth") hotel in Portsmouth, NH for $43.4 million on September 20, 2017, the Courtyard Summerville ("Summerville") hotel in Summerville, SC for $20.2 million on November 15, 2017 and the Embassy Suites Springfield Embassy ("Springfield") hotel in Springfield, VA for $68.1 million on December 6, 2017. No acquisitions were completed in 2016. The allocation of the purchase price of each of the hotels acquired by the Company in 2018, based on the fair value on the date of its acquisition, dollars (in thousands):


	RI Summerville		Dallas DT		HGI Portsmouth		CY Summerville		ES Springfield		Total
Acquisition date	8/27/2018		12/5/2018		9/20/2017		11/15/2017		12/6/2017
Number of rooms (unaudited)	96		167		131		96		219		709
Land	$	2,300	$	2,900	$	3,600	$	2,500	$	7,700	$	19,000
Building and improvements	17,060		42,760		37,630		16,923		58,807		173,180
Furniture, fixtures and equipment	1,234		3,340		2,120		730		1,490		8,914
Cash	—		5		8		1		3		17

Accounts receivable	—		8		32		1		—		41

Prepaid expenses and other assets	—		68		12		28		129		237

Accounts payable and accrued expenses	(9)		(33)		(27)		(1)		(51)		(121)


Net assets acquired, net of cash	$	20,585	$	49,043	$	43,367	$	20,181	$	68,075	$	201,251

The value of the assets acquired was primarily based on a sales comparison approach (for land) and a depreciated replacement cost approach (for building and improvements and furniture, fixtures and equipment). The sales comparison approach uses inputs of recent land sales in the respective hotel markets. The depreciated replacement cost approach uses inputs of both direct and indirect replacement costs using a nationally recognized authority on replacement cost information as well as the age, square footage and number of rooms of the respective assets. Property acquisition costs of $0.1 million and $0.7 million, respectively, were capitalized in 2018 and 2017.

The amount of revenue and operating income from the hotels acquired in 2018 and 2017 from their respective date of acquisition through December 31, 2018 is as follows (in thousands):


		For the Year Ended December 31, 2018						For the Year Ended December 31, 2017
	Acquisition Date	Revenue		Operating Income		Revenue		Operating Income
Hilton Garden Inn Portsmouth, NH	9/20/17	$	9,160	$	3,977	$	2,453	$	1,116
Courtyard Summerville, SC	11/15/17	3,969		1,643		384		152
Embassy Suites Springfield, VA	12/6/17	13,886		5,573		674		161
Residence Inn Summerville, SC	8/27/18	875		176		—		—
Courtyard Dallas Downtown, TX	12/5/18	258		38		—		—
Total		$	28,148	$	11,407	$	3,511	$	1,429

On August 29, 2017, the Company purchased a parcel of land in Los Angeles county, California for $6.5 million.