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Related Party Transactions | 9 Months Ended
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Sep. 30, 2025
Related Party Transactions [Abstract] |
Related Party Transactions | Related Party Transactions Ashford Inc. Advisory Agreement Ashford LLC, a subsidiary of Ashford Inc., acts as our advisor. Our chairman, Mr. Monty Bennett, also serves as chairman of the board of directors and chief executive officer of Ashford Inc. Under our advisory agreement, we pay advisory fees to Ashford LLC. We pay a monthly base fee equal to 1/12 of the sum of (i) 0.70% of the total market capitalization of our company for the prior month, plus (ii) the Net Asset Fee Adjustment (as defined in our advisory agreement), if any, on the last day of the prior month during which our advisory agreement was in effect; provided, however, in no event shall the base fee for any month be less than the minimum base fee as provided by our advisory agreement. The base fee is payable on the fifth business day of each month. The minimum base fee for Braemar for each month will be equal to the greater of: ▪90% of the base fee paid for the same month in the prior year; and ▪1/12 of the G&A Ratio (as defined) multiplied by the total market capitalization of Braemar. We are also required to pay Ashford LLC an incentive fee that is measured annually (or for a stub period if the advisory agreement is terminated at other than year-end). Each year that our annual total stockholder return exceeds the average annual total stockholder return for our peer group, we pay Ashford LLC an incentive fee over the following three years, subject to the Fixed Charge Coverage Ratio (“FCCR”) Condition, as defined in the advisory agreement, which relates to the ratio of adjusted EBITDA to fixed charges. We also reimburse Ashford LLC for certain reimbursable overhead and internal audit, risk management advisory and asset management services, as specified in the advisory agreement. We also recorded equity-based compensation expense for equity grants of common stock, PSUs and LTIP units awarded to officers and employees of Ashford LLC in connection with providing advisory services. The following table summarizes the advisory services fees incurred (in thousands):
| Three Months Ended September 30, |  | Nine Months Ended September 30, |
| 2025 |  | 2024 |  | 2025 |  | 2024 |  |  |
Advisory services fee |  |  |  |  |  |  |  |  |  |
Base advisory fee | $ | 3,539 |  |  | $ | 3,505 |  |  | $ | 10,592 |  |  | $ | 10,168 |  |  |  |
Reimbursable expenses (1) | 3,825 |  |  | 3,231 |  |  | 10,403 |  |  | 8,457 |  |  |  |
Equity-based compensation (2) | 75 |  |  | 427 |  |  | (24) |  |  | 2,418 |  |  |  |
Incentive fee | 476 |  |  | 1,464 |  |  | 746 |  |  | 2,112 |  |  |  |
Total | $ | 7,915 |  |  | $ | 8,627 |  |  | $ | 21,717 |  |  | $ | 23,155 |  |  |  |
________ (1)Reimbursable expenses include overhead, internal audit, risk management advisory, asset management services and deferred cash awards. (2) Equity-based compensation is associated with equity grants of Braemar’s common stock, PSUs, LTIP units and Performance LTIP units awarded to officers and employees of Ashford LLC. On each of March 11, 2024 and March 10, 2025, we entered into a Limited Waiver Under Advisory Agreement with Ashford Inc. and Ashford LLC (collectively, the “Advisory Agreement Limited Waivers”). Pursuant to the Advisory Agreement Limited Waivers, the Company, the Operating Partnership, TRS and the Advisor waive the operation of any provision in our advisory agreement that would otherwise limit the ability of the Company in its discretion, at the Company’s cost and expense, to award during calendar years 2024 and 2025, respectively, cash incentive compensation to employees and other representatives of the Advisor. Pursuant to the Company’s hotel management agreements with each hotel management company, the Company bears the economic burden for casualty insurance coverage which includes workers’ compensation, general liability and auto liability coverages. The hotel management companies procure workers’ compensation insurance, the expenses of which are passed through to the Company. Under the advisory agreement and hotel management agreements, Ashford Inc. secures general liability and auto liability policies to cover Ashford Trust, Braemar, Stirling OP, their hotel managers, as needed, and Ashford Inc. The total cost estimates covered by such policies are based on the collective pool of risk exposures from each party. Ashford Inc. delegates the management of the casualty insurance program to Warwick Insurance Company, LLC (“Warwick”), a subsidiary of Ashford Inc. which issues policies covering general liability, workers’ compensation and auto liability losses. Each year Ashford Inc. collects funds from Ashford Trust, Braemar, Stirling OP and their respective hotel management companies, to fund the casualty insurance program as needed, on an allocated basis. On August 26, 2025, Braemar entered into an agreement with Ashford Inc. to explore a potential sale of Braemar. Pursuant to the Letter Agreement, Braemar and Ashford Inc. agreed that the termination fee payable to Ashford Inc. under the advisory agreement is $574.8 million (exclusive of accrued fees). However, Braemar and Ashford Inc. have agreed to the payment of a discounted aggregate amount of $480.0 million plus accrued fees. Ashford Inc. received a $17.0 million payment upon execution of the agreement. The $17.0 million payment will be credited against other amounts due to Ashford Inc. from Braemar if the sale of the Company does not occur before July 1, 2028. The $17.0 million payment is presented in “deposit paid to Ashford Inc.” on the condensed consolidated balance sheet. Lismore We engage Lismore or its subsidiaries to provide debt placement services and assist with loan modifications or refinancings on our behalf and brokerage services. For the three and nine months ended September 30, 2025, we incurred fees from Lismore or its subsidiaries of $0 and $1.7 million, respectively. For the three and nine months ended September 30, 2024, we incurred fees from Lismore or its subsidiaries of $1.8 million and $2.9 million, respectively. Ashford Securities The Company, Ashford Trust, and Ashford Inc. are party to the Fourth Amended and Restated Contribution Agreement with respect to funding certain expenses of Ashford Securities LLC, a subsidiary of Ashford Inc. (“Ashford Securities”). As of September 30, 2025 and December 31, 2024, Braemar has funded approximately $12.9 million and has a pre-funded balance of $797,000 that is included in “other assets” on the condensed consolidated balance sheet. During the first quarter of 2024, there was a true-up of the funding requirement based on the aggregate capital raised that resulted in a credit to expense of $5.6 million for the nine months ended September 30, 2024. The table below summarizes the amount Braemar has expensed related to reimbursed operating expenses of Ashford Securities (in thousands):
|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
Line Item |  | 2025 |  | 2024 |  | 2025 |  | 2024 |  |
Corporate, general and administrative |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | (5,624) |  |  |
Design and Construction Services Premier Project Management LLC (“Premier”), a subsidiary of Ashford Inc., provides design and construction services to our hotels, including construction management, interior design, architectural services, and the purchasing, freight management and supervision of installation of FF&E and related services. Pursuant to the design and construction services agreement, we pay Premier: (a) design and construction fees of up to 4% of project costs; and (b) for the following services: (i) architectural (6.5% of total construction costs); (ii) construction management for projects without a general contractor (10% of total construction costs); (iii) interior design (6% of the purchase price of the FF&E designed or selected by Premier); and (iv) FF&E purchasing (8% of the purchase price of FF&E purchased by Premier; provided that if the purchase price exceeds $2.0 million for a single hotel in a calendar year, then the purchasing fee is reduced to 6% of the FF&E purchase price in excess of $2.0 million for such hotel in such calendar year). Such fees are payable monthly as the service is delivered based on percentage complete, as reasonably determined by Premier for each service, or payable as set forth in other agreements. Hotel Management Services As of September 30, 2025, Remington Hospitality managed five of our 14 hotel properties. We pay monthly hotel management fees equal to the greater of approximately $18,000 per hotel (increased annually based on consumer price index adjustments) or 3% of gross revenues, as well as annual incentive management fees, if certain operational criteria were met, and other general and administrative expense reimbursements primarily related to accounting services. Our hotel management agreement also requires that we fund property-level operating costs, including the hotel manager's payroll and related costs. Investment in OpenKey OpenKey, Inc. (“OpenKey”) is a hospitality-focused mobile key platform that provides a universal smart phone app and related hardware and software for keyless entry into hotel guest rooms. As of September 30, 2025 and December 31, 2024, the Company had made equity investments in OpenKey totaling $2.9 million resulting in an ownership interest of 7.9% accounted for under the equity method of accounting. During the fourth quarter of 2024, we determined that the estimated fair value of the investment in OpenKey was less than our carrying amount and fully impaired our investment as of December 31, 2024. The Company also entered into a loan funding agreement with Ashford Inc. and OpenKey. The loan bears interest at an annual rate of 15%. During the fourth quarter of 2024, we determined that the full amount of the note receivable was not collectible, the note receivable was impaired and the recognition of interest income ceased. As of September 30, 2025 and December 31, 2024, the carrying amount of the loan was $145,000 included in “investment of unconsolidated entity” on our condensed consolidated balance sheets.

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