Investments in Hotel Properties, net

Investments in hotel properties, net consisted of the following (in thousands):



	March 31, 2019			December 31, 2018
Land	$	455,298		$	428,567
Buildings and improvements	1,089,457			989,180
Furniture, fixtures and equipment	114,086			103,025
Construction in progress	60,434			42,034
Total cost	1,719,275			1,562,806
Accumulated depreciation	(276,799		)	(262,905		)
Investments in hotel properties, net	$	1,442,476		$	1,299,901

Ritz-Carlton, Lake Tahoe

On January 15, 2019, the Company acquired a 100% interest in the 170-room Ritz-Carlton, Lake Tahoe located in Truckee, California for $120.0 million. The Company incurred $582,000 in acquisition costs. In connection with the acquisition the Company completed the financing of a $54.0 million mortgage loan secured by the Ritz-Carlton, Lake Tahoe. See note 8.

We accounted for this transaction as an asset acquisition because substantially all of the fair value of the gross assets acquired were concentrated in a group of similar identifiable assets. We allocated the cost of the acquisition including transaction costs to the individual assets acquired and liabilities assumed on a relative fair value basis, which is considered a Level 3 valuation technique, as noted in the following table (in thousands):



Land ⁽¹⁾	$	26,731
Buildings and improvements	89,340
Furniture, fixtures and equipment	2,172
	$	118,243
Capital reserves	6,150
Key money	(3,811		)
	$	120,582
Net other assets (liabilities)	$	912

________


⁽¹⁾	Amount includes the value of a 3.4-acre parking lot adjacent to the hotel which could be used for future development of luxury town homes.

The results of operations of the hotel property have been included in our results of operations as of the acquisition date. The table below summarizes the total revenue and net income (loss) in our condensed consolidated statements of operations for the three months ended March 31, 2019:



	Three Months Ended March 31, 2019
Total revenue	$	13,491
Net income (loss)	$	3,028

Impairment Charges and Insurance Recoveries

In September 2017, the Ritz-Carlton, St. Thomas located in St. Thomas, USVI, the Key West Pier House located in Key West, FL and the Tampa Renaissance located in Tampa, FL (sold in 2018) were impacted by the effects of Hurricanes Irma and Maria. The Company holds insurance policies that provide coverage for property damage and business interruption after meeting certain deductibles at all of its hotel properties.

For the three months ended March 31, 2019 and 2018, the Company recorded revenue from business interruption losses associated with lost profits from the hurricanes of $6.0 million and $4.9 million, respectively, which are included in “other” hotel revenue in our condensed consolidated statements of operations. The Company received no proceeds from our insurance carriers for property damage and business interruption from the hurricanes during both the three months ended March 31, 2019 and 2018. Additionally, during the three months ended March 31, 2018, the Company recorded revenue of $1.8 million, net of deductibles of $500,000, for business interruption losses associated with lost profits at the Bardessono Hotel and Hotel Yountville as a result of the Napa wildfires, which is included in “other” hotel revenue in our condensed consolidated statements of operations. During the three months ended March 31, 2019 and 2018, we recorded impairment charges of $0 and $12,000, respectively, as a result of a change in estimate of property damage as a result of the hurricanes. As of March 31, 2019, the Company had a net liability of $11.4 million, included in “other liabilities” on the condensed consolidated balance sheet, as it has received insurance proceeds in excess of the sum of its impairment, remediation expenses and business interruption revenue recorded through March 31, 2019. The Company will not record revenue for business interruption losses associated with lost profits or gains from property damage recoveries until the amount for such recoveries is known and the amount is realizable.