peb-20240331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



FORM			10-Q


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

For the quarterly period ended March 31, 2024


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

For the transition period from to .

Commission File Number 001-34571




PEBBLEBROOK HOTEL TRUST
			(Exact Name of Registrant as Specified in Its Charter)


Maryland						27-1055421
(State of Incorporation or Organization)						(I.R.S. Employer Identification No.)

4747 Bethesda Avenue, Suite 1100, Bethesda, Maryland						20814
(Address of Principal Executive Offices)						(Zip Code)


(240)			507-1300
(Registrant’s telephone number, including area code)

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 Shares, $0.01 par value per share

PEB

New York Stock Exchange

Series E Cumulative Redeemable Preferred Shares, $0.01 par value

PEB-PE

New York Stock Exchange

Series F Cumulative Redeemable Preferred Shares, $0.01 par value

PEB-PF

New York Stock Exchange

Series G Cumulative Redeemable Preferred Shares, $0.01 par value

PEB-PG

New York Stock Exchange

Series H Cumulative Redeemable Preferred Shares, $0.01 par value

PEB-PH

New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☑ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☑ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☑

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark 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. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes ☑ No

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.


Class						Outstanding at April 19, 2024
Common shares of beneficial interest ($0.01 par value per share)						120,503,501


Pebblebrook Hotel Trust TABLE OF CONTENTS



		Page
PART I. FINANCIAL INFORMATION
Item 1.	Financial Statements.	3
	Consolidated Balance Sheets - March 31, 2024 (unaudited) and December 31, 2023	3
	Consolidated Statements of Operations and Comprehensive Income (unaudited) - Three months ended March 31, 2024 and 2023	4
	Consolidated Statements of Equity (unaudited) - Three months ended March 31, 2024 and 2023	6
	Consolidated Statements of Cash Flows (unaudited) - Three months ended March 31, 2024 and 2023	7
	Notes to the Consolidated Financial Statements (unaudited)	8
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations.	22
Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	29
Item 4.	Controls and Procedures.	29
PART II. OTHER INFORMATION
Item 1.	Legal Proceedings.	30
Item 1A.	Risk Factors.	30
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	30
Item 3.	Defaults Upon Senior Securities.	30
Item 4.	Mine Safety Disclosures.	30
Item 5.	Other Information.	31
Item 6.	Exhibits.	32

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements.


Pebblebrook Hotel Trust Consolidated Balance Sheets (in thousands, except share and per-share data)

	March 31, 2024		December 31, 2023
	(Unaudited)
ASSETS
Investment in hotel properties, net	$	5,475,450	$	5,490,776

Cash and cash equivalents	56,707		183,747
Restricted cash	8,267		9,894
Hotel receivables (net of allowance for doubtful accounts of $341 and $689, respectively)	53,934		43,912
Prepaid expenses and other assets	103,593		96,644
Total assets	$	5,697,951	$	5,824,973
LIABILITIES AND EQUITY
Debt	$	2,206,651	$	2,319,801
Accounts payable, accrued expenses and other liabilities	247,029		238,644
Lease liabilities - operating leases	320,649		320,617
Deferred revenues	87,874		76,874
Accrued interest	10,390		6,830

Distribution payable	11,849		11,862
Total liabilities	2,884,442		2,974,628
Commitments and contingencies (Note 11)
Shareholders’ equity:
Preferred shares of beneficial interest, $.01 par value (liquidation preference $690,000 at March 31, 2024 and December 31, 2023), 100,000,000 shares authorized; 27,600,000 shares issued and outstanding at March 31, 2024 and December 31, 2023	276		276
Common shares of beneficial interest, $.01 par value, 500,000,000 shares authorized; 120,094,380 shares issued and outstanding at March 31, 2024 and 120,191,349 shares issued and outstanding at December 31, 2023	1,201		1,202
Additional paid-in capital	4,074,898		4,078,912
Accumulated other comprehensive income (loss)	31,067		24,374
Distributions in excess of retained earnings	(1,381,450)		(1,341,264)
Total shareholders’ equity	2,725,992		2,763,500
Non-controlling interests	87,517		86,845
Total equity	2,813,509		2,850,345
Total liabilities and equity	$	5,697,951	$	5,824,973

The accompanying notes are an integral part of these financial statements.

Table of Contents


Pebblebrook Hotel Trust Consolidated Statements of Operations and Comprehensive Income (in thousands, except share and per-share data)
(Unaudited)
	For the three months ended March 31,
		2024		2023
Revenues:
Room		$	198,100	$	196,374
Food and beverage		81,095		75,763
Other operating		34,874		33,582
Total revenues		314,069		305,719
Expenses:
Hotel operating expenses:
Room		55,023		56,424
Food and beverage		61,014		58,672
Other direct and indirect		100,019		99,214
Total hotel operating expenses		216,056		214,310
Depreciation and amortization		57,209		58,369
Real estate taxes, personal property taxes, property insurance, and ground rent		32,405		28,904
General and administrative		12,177		9,988


Gain on sale of hotel properties		—		(6,635)
Business interruption insurance income		(3,980)		(8,089)
Other operating expenses		1,581		3,670
Total operating expenses		315,448		300,517
Operating income (loss)		(1,379)		5,202
Interest expense		(26,421)		(27,430)
Other		326		183
Income (loss) before income taxes		(27,474)		(22,045)
Income tax (expense) benefit		(46)		—
Net income (loss)		(27,520)		(22,045)
Net income (loss) attributable to non-controlling interests		830		883
Net income (loss) attributable to the Company		(28,350)		(22,928)
Distributions to preferred shareholders		(10,631)		(10,988)

Net income (loss) attributable to common shareholders		$	(38,981)	$	(33,916)

Net income (loss) per share available to common shareholders, basic		$	(0.32)	$	(0.27)
Net income (loss) per share available to common shareholders, diluted		$	(0.32)	$	(0.27)
Weighted-average number of common shares, basic		120,085,226		125,488,415
Weighted-average number of common shares, diluted		120,085,226		125,488,415

Table of Contents


Pebblebrook Hotel Trust Consolidated Statements of Operations and Comprehensive Income - Continued (in thousands, except share and per-share data)
(Unaudited)
	For the three months ended March 31,
		2024		2023
Comprehensive Income:
Net income (loss)		$	(27,520)	$	(22,045)
Other comprehensive income (loss):
Change in fair value of derivative instruments		13,076		(46)
Amounts reclassified from other comprehensive income		(6,335)		(5,825)
Comprehensive income (loss)		(20,779)		(27,916)
Comprehensive income (loss) attributable to non-controlling interests		878		845
Comprehensive income (loss) attributable to the Company		$	(21,657)	$	(28,761)

The accompanying notes are an integral part of these financial statements.

Table of Contents


Pebblebrook Hotel Trust Consolidated Statements of Equity (in thousands, except share data)
(Unaudited)

	For the three months ended March 31, 2024
	Preferred Shares			Common Shares			Additional Paid-In Capital		Accumulated Other Comprehensive Income (Loss)		Distributions in Excess of Retained Earnings		Total Shareholders' Equity		Non-Controlling Interests		Total Equity
	Shares	Amount		Shares	Amount
Balance at December 31, 2023	27,600,000	$	276	120,191,349	$	1,202	$	4,078,912	$	24,374	$	(1,341,264)	$	2,763,500	$	86,845	$	2,850,345



Issuance of common shares for Board of Trustees compensation	—	—		47,497	1		744		—		—		745		—		745
Repurchase of common shares	—	—		(387,651)	(4)		(6,847)		—		—		(6,851)		—		(6,851)
Share-based compensation	—	—		243,185	2		2,089		—		—		2,091		969		3,060
Distributions on common shares/units	—	—		—	—		—		—		(1,205)		(1,205)		(11)		(1,216)
Distributions on preferred shares/units	—	—		—	—		—		—		(10,631)		(10,631)		(1,164)		(11,795)
Other comprehensive income (loss):
Change in fair value of derivative instruments	—	—		—	—		—		13,028		—		13,028		48		13,076
Amounts reclassified from other comprehensive income	—	—		—	—		—		(6,335)		—		(6,335)		—		(6,335)
Net income (loss)	—	—		—	—		—		—		(28,350)		(28,350)		830		(27,520)
Balance at March 31, 2024	27,600,000	$	276	120,094,380	$	1,201	$	4,074,898	$	31,067	$	(1,381,450)	$	2,725,992	$	87,517	$	2,813,509





	For the three months ended March 31, 2023
	Preferred Shares			Common Shares			Additional Paid-In Capital		Accumulated Other Comprehensive Income (Loss)		Distributions in Excess of Retained Earnings		Total Shareholders' Equity		Non-Controlling Interests		Total Equity
	Shares	Amount		Shares	Amount
Balance at December 31, 2022	28,600,000	$	286	126,345,293	$	1,263	$	4,182,359	$	35,724	$	(1,223,117)	$	2,996,515	$	88,028	$	3,084,543



Issuance of common shares for Board of Trustees compensation	—	—		55,480	1		753		—		—		754		—		754
Repurchase of common shares	—	—		(3,003,513)	(30)		(42,715)		—		—		(42,745)		—		(42,745)
Share-based compensation	—	—		235,407	2		2,094		—		—		2,096		783		2,879
Distributions on common shares/units	—	—		—	—		—		—		(1,242)		(1,242)		(10)		(1,252)
Distributions on preferred shares/units	—	—		—	—		—		—		(10,988)		(10,988)		(1,164)		(12,152)


Other comprehensive income (loss):
Change in fair value of derivative instruments	—	—		—	—		—		(8)		—		(8)		(38)		(46)
Amounts reclassified from other comprehensive income	—	—		—	—		—		(5,825)		—		(5,825)		—		(5,825)
Net income (loss)	—	—		—	—		—		—		(22,928)		(22,928)		883		(22,045)
Balance at March 31, 2023	28,600,000	$	286	123,632,667	$	1,236	$	4,142,491	$	29,891	$	(1,258,275)	$	2,915,629	$	88,482	$	3,004,111

The accompanying notes are an integral part of these financial statements.

Table of Contents


Pebblebrook Hotel Trust Consolidated Statements of Cash Flows (in thousands)
(Unaudited)

	For the three months ended March 31,
	2024		2023
Operating activities:
Net income (loss)	$	(27,520)	$	(22,045)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization	57,209		58,369
Share-based compensation	3,060		2,879
Amortization of deferred financing costs, non-cash interest and other amortization	4,078		3,005
Gain on sale of hotel properties	—		(6,635)

Non-cash ground rent	2,462		2,476
Other adjustments	(1,528)		(4,964)
Changes in assets and liabilities:
Hotel receivables	(9,674)		1,285
Prepaid expenses and other assets	3,181		(3,848)
Accounts payable and accrued expenses	3,002		4,805
Deferred revenues	11,730		10,902
Net cash provided by (used in) operating activities	46,000		46,229
Investing activities:
Improvements and additions to hotel properties	(49,480)		(34,514)
Proceeds from sales of hotel properties	—		131,881


Property insurance proceeds	11,500		8,357
Other investing activities	(533)		(548)
Net cash provided by (used in) investing activities	(38,513)		105,176
Financing activities:



Payment of deferred financing costs	(5,484)		(154)

SEC Form 10-Q filed by Pebblebrook Hotel Trust