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Redeemable Noncontrolling Interests in Operating Partnership | 6 Months Ended
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Jun. 30, 2017
Redeemable Noncontrolling Interest, Equity, Carrying Amount [Abstract] |
Redeemable Noncontrolling Interests in Operating Partnership | Redeemable Noncontrolling Interests in Operating Partnership Redeemable noncontrolling interests in the operating partnership represents the limited partners’ proportionate share of equity and their allocable share of equity in earnings/losses of Ashford Prime OP, which is an allocation of net income/loss attributable to the common unitholders based on the weighted average ownership percentage of these limited partners’ common units of limited partnership interest in the operating partnership (“common units”) and units issued under our Long-Term Incentive Plan (the “LTIP units”) that are vested. Beginning one year after issuance, each common unit may be redeemed, by the holder, for either cash or, at our sole discretion, up to one share of our REIT common stock, which is either (i) issued pursuant to an effective registration statement; (ii) included in an effective registration statement providing for the resale of such common stock; or (iii) issued subject to a registration rights agreement. LTIP units, which are issued to certain executives and employees of Ashford LLC as compensation, have vesting periods of three years. Additionally, certain independent members of the board of directors have elected to receive LTIP units as part of their compensation, which are fully vested upon grant. Upon reaching economic parity with common units, each vested LTIP unit can be converted by the holder into one common unit which can then be redeemed for cash or, at our election, settled in our common stock. An LTIP unit will achieve parity with the common units upon the sale or deemed sale of all or substantially all of the assets of our operating partnership at a time when our stock is trading at a level in excess of the price it was trading on the date of the LTIP issuance. More specifically, LTIP units will achieve full economic parity with common units in connection with (i) the actual sale of all or substantially all of the assets of our operating partnership or (ii) the hypothetical sale of such assets, which results from a capital account revaluation, as defined in the partnership agreement, for our operating partnership. The compensation committee of the board of directors of the Company approves performance-based LTIP units to certain executive officers from time to time. The award agreements provide for the grant of a target number of performance-based LTIP units that will be settled in common units of the Ashford Prime OP, if and when the applicable vesting criteria have been achieved following the end of the performance and service period. The target number of performance-based LTIP units may be adjusted from 0% to 200% of the target number based on achievement of a specified relative total stockholder return based on the formula determined by the Company’s Compensation Committee on the grant date. As of June 30, 2017, a total of 983,000 performance-based LTIP units representing 200% of the target were issued. The performance criteria for the performance-based LTIP units are based on market conditions under the relevant literature, and the performance-based LTIP units were granted to non-employees. The unamortized fair value of performance-based LTIP units of $1.9 million at June 30, 2017 will be expensed over a period of 2.5 years, subject to future mark to market adjustments. We recorded credits to compensation expense in the amount of $57,000 and $1.1 million for the three and six months ended June 30, 2017, respectively, due to lower fair values as compared to prior periods. For the three and six months ended June 30, 2016, this expense was $1.0 million and $691,000, respectively. The related amounts are included in “advisory services fee” on our condensed consolidated statements of operations. As of June 30, 2017, we have issued a total of 1.5 million LTIP units (including performance-based LTIP units), all of which, other than approximately 3,000 LTIP units issued in March 2015, 6,000 LTIP units issued in May 2015, 389,000 performance-based LTIP units issued in June 2015, 312,000 performance-based LTIP units issued in October 2016, 141,000 LTIP units issued in April 2017, 281,000 performance-based LTIP units issued in April 2017 and 6,000 LTIP units issued in June 2017, had reached full economic parity with, and are convertible into, common units. For the three and six months ended June 30, 2017, compensation expense of $130,000 and $173,000, respectively, was recorded related to the LTIP units issued to Ashford LLC’s employees. For the three and six months ended June 30, 2016, this expense was $627,000 and $713,000 respectively. These amounts are included in “advisory services fee.” Expense of $64,000 was recorded for both the three and six months ended June 30, 2017 and expense of $44,000 was recorded for both the three and six months ended June 30, 2016, respectively, which was related to LTIP units issued to our independent directors. These amounts are included in “corporate general and administrative” expense in our condensed consolidated statements of operations. The fair value of the unrecognized cost of LTIP units, which was $1.4 million at June 30, 2017, will be amortized over a period of 2.8 years, subject to future mark to market adjustments. During the three and six months ended June 30, 2017, approximately 1,000 and 6,000 common units with an aggregate redemption fair value of $15,000 and $82,000, respectively, were redeemed by the holders and, at our election, we issued shares of our common stock to satisfy the redemption. During the three and six months ended June 30, 2016, no common units were redeemed. Redeemable noncontrolling interests in Ashford Prime OP as of June 30, 2017 and December 31, 2016, were $47.6 million and $59.5 million, respectively, which represented ownership of our operating partnerships of 11.71% and 13.19%, respectively. The carrying value of redeemable noncontrolling interests as of June 30, 2017 and December 31, 2016, included adjustments of $24,000 and $8.9 million, respectively, to reflect the excess of redemption value over the accumulated historical costs. For the three and six months ended June 30, 2017, we allocated net loss of $343,000 and $598,000 to the redeemable noncontrolling interests, respectively. For the three and six months ended June 30, 2016, we allocated net income of $184,000 and $34,000 to the redeemable noncontrolling interests, respectively. For the three and six months ended June 30, 2017, we declared aggregate cash distributions to holders of common units and holders of LTIP units of $859,000 and $1.6 million, respectively. For the three and six months ended June 30, 2016, we declared aggregate cash distributions to holders of common units and holders of LTIP units of $572,000 and $1.1 million, respectively. These distributions are recorded as a reduction of redeemable noncontrolling interests in operating partnership.

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- Definition The entire disclosure for noncontrolling interest in consolidated subsidiaries, which could include the name of the subsidiary, the ownership percentage held by the parent, the ownership percentage held by the noncontrolling owners, the amount of the noncontrolling interest, the location of this amount on the balance sheet (when not reported separately), an explanation of the increase or decrease in the amount of the noncontrolling interest, the noncontrolling interest share of the net Income or Loss of the subsidiary, the location of this amount on the income statement (when not reported separately), the nature of the noncontrolling interest such as background information and terms, the amount of the noncontrolling interest represented by preferred stock, a description of the preferred stock, and the dividend requirements of the preferred stock. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 810 -URI http://asc.fasb.org/topic&trid=2197479 + Details
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