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What changed in ASHFORD HOSPITALITY TRUST INC's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of ASHFORD HOSPITALITY TRUST INC's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+447 added−405 removedSource: 10-K (2026-03-23) vs 10-K (2025-03-21)

Top changes in ASHFORD HOSPITALITY TRUST INC's 2025 10-K

447 paragraphs added · 405 removed · 284 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

22 edited+17 added−5 removed65 unchanged
Biggest changeAs of December 31, 2024, we held interests in the following assets: • 68 consolidated operating hotel properties, which represent 17,051 total rooms; • one consolidated operating hotel property, which represents 188 total rooms through a 29.3% owned investment in a consolidated entity; • Four consolidated operating hotel properties, which represent 405 total rooms owned through a 98.8% ownership interest in Stirling REIT OP, LP (“Stirling OP”), which was formed by Stirling Inc. to acquire and own a diverse portfolio of stabilized income-producing hotels and resorts; and • an investment in an entity that owns the Meritage Resort and Spa and the Grand Reserve at the Meritage (the “Meritage Investment”) in Napa, CA, with a carrying value of approximately $7.6 million.
Biggest changeAs of December 31, 2025, we held interests in the following assets: • 67 consolidated operating hotel properties, which represent 16,445 total rooms; • one consolidated operating hotel property, which represents 188 total rooms through a 29.3%-owned investment in a consolidated entity; and • an investment in an entity that owns the Meritage Resort and Spa and the Grand Reserve at the Meritage (the “Meritage Investment”) in Napa, California, with a carrying value of approximately $7.3 million.
To the extent that cash flows from operations are insufficient during any quarter to enable us to make quarterly distributions to maintain our REIT status due to temporary or seasonal fluctuations in lease revenue, we expect to utilize cash on hand, cash generated through borrowings, and issuances of common stock to fund required distributions.
To the extent that cash flows from operations are insufficient during any quarter to enable us to make quarterly distributions to maintain our REIT status due to 8 temporary or seasonal fluctuations in lease revenue, we expect to utilize cash on hand, cash generated through borrowings, and issuances of common stock to fund required distributions.
No assurances can be given that: (i) future laws, ordinances, or regulations will not impose any material environmental liability; or (ii) the current environmental condition of our properties will not be affected by the condition of properties in the vicinity (such as the presence of leaking underground storage tanks) or by third parties unrelated to us.
No assurances can be given that: (i) future 7 laws, ordinances, or regulations will not impose any material environmental liability; or (ii) the current environmental condition of our properties will not be affected by the condition of properties in the vicinity (such as the presence of leaking underground storage tanks) or by third parties unrelated to us.
Neither we nor, to our knowledge, any of 7 the former owners of our properties have been notified by any governmental authority of any material noncompliance, liability, or claim relating to hazardous or toxic substances or other environmental matters in connection with any of our properties.
Neither we nor, to our knowledge, any of the former owners of our properties have been notified by any governmental authority of any material noncompliance, liability, or claim relating to hazardous or toxic substances or other environmental matters in connection with any of our properties.
However, we cannot make any assurances that we will make distributions in the future. 8 ACCESS TO REPORTS AND OTHER INFORMATION We maintain a website at www.ahtreit.com.
However, we cannot make any assurances that we will make distributions in the future. ACCESS TO REPORTS AND OTHER INFORMATION We maintain a website at www.ahtreit.com.
Declaration of dividends in 2025 on our preferred stock may require a determination by our board of directors, at the time of any determination, that the Company would continue to have positive equity on a fair value basis, among other considerations. Our board of directors will continue to review our dividend policy and make future announcements with respect thereto.
Declaration of dividends in 2026 on our preferred stock may require a determination by our board of directors, at the time of any determination, that the Company would continue to have positive equity on a fair value basis, among other considerations. Our board of directors will continue to review our dividend policy and make future announcements with respect thereto.
See note 17 to our consolidated financial statements. Mr. Monty J. Bennett is chairman and chief executive officer of Ashford Inc. and, together with his father Mr. Archie Bennett, Jr., as of December 31, 2024, holds a controlling interest in Ashford Inc.
See note 17 to our consolidated financial statements. Mr. Monty J. Bennett is chairman and chief executive officer of Ashford Inc. and, together with his father Mr. Archie Bennett, Jr., as of December 31, 2025, holds a controlling interest in Ashford Inc.
These products and services include, but are not limited to, design and construction services, debt placement and related services, audiovisual services, real estate advisory and brokerage services, insurance policies covering general liability, workers’ compensation and business automobile claims and insurance claims services, hypoallergenic premium rooms, watersport activities, broker-dealer and distribution services, mobile key technology and cash management services.
These products and services include, but are not limited to, design and construction services, debt placement and related services, audiovisual services, real estate advisory and brokerage services, insurance policies covering general liability, workers’ compensation and business automobile claims and insurance claims services, hypoallergenic premium rooms, watersport activities, broker-dealer and distribution services and cash management services.
Our corporate charter allows us to issue preferred stock with a preference on distributions, such as our 8.45% Series D Cumulative Preferred Stock, par value $0.01 per share (the “Series D Preferred Stock”), 7.375% Series F Cumulative Preferred Stock, par value $0.01 per share (the “Series F Preferred Stock”), 7.375% Series G Cumulative Preferred Stock, par value $0.01 per share (the “Series G Preferred Stock”), 7.50% Series H Cumulative Preferred Stock, par value $0.01 per share (the “Series H Preferred Stock”), 7.50% Series I Cumulative Preferred Stock, par value $0.01 per share (the “Series I Preferred Stock”) 8.0% Series J Redeemable Preferred Stock, par value $0.01 per share (the “Series J Preferred Stock”), Series K Redeemable Preferred Stock, par value $0.01 per share (the “Series K Preferred Stock,”) (together the “Preferred Stock”).
Our corporate charter allows us to issue preferred stock with a preference on distributions, such as our 8.45% Series D Cumulative Preferred Stock, par value $0.01 per share (the “Series D Preferred Stock”), 7.375% Series F Cumulative Preferred Stock, par value $0.01 per share (the “Series F Preferred Stock”), 7.375% Series G Cumulative Preferred Stock, par value $0.01 per share (the “Series G Preferred Stock”), 7.50% Series H Cumulative Preferred Stock, par value $0.01 per share (the “Series H Preferred Stock”), 7.50% Series I Cumulative Preferred Stock, par value $0.01 per share (the “Series I Preferred Stock”), 8.0% Series J Redeemable Preferred Stock, par value $0.01 per share (the “Series J Preferred Stock”), Series K Redeemable Preferred Stock, par value $0.01 per share (the “Series K Preferred Stock”), Series L Redeemable Preferred Stock, par value $0.01 per share (the “Series L Preferred Stock”), and Series M Redeemable Preferred Stock, par value $0.01 per share (the “Series M Preferred Stock”) (together the “Preferred Stock”).
As of December 31, 2024, our portfolio consisted of 73 consolidated operating hotel properties, 68 of which operated under franchise licenses or brand management agreements, which provided for the right to operate each hotel under the applicable brand. See Item 2 Properties, below for a complete listing of all hotels by brand.
As of December 31, 2025, our portfolio consisted of 68 consolidated operating hotel properties, 63 of which operated under franchise licenses or brand management agreements, which provided for the right to operate each hotel under the applicable brand. See Item 2 Properties, below for a complete listing of all hotels by brand.
As of December 31, 2024, the Company had a deficit in stockholders’ equity of approximately $419.2 million and had not generated current earnings from which a dividend is potentially payable since the year ended December 31, 2015.
As of December 31, 2025, the Company had a deficit in stockholders’ equity of approximately $626.4 million and had not generated current earnings from which a dividend is potentially payable since the year ended December 31, 2015.
Series D Convertible Preferred Stock, which, along with all unpaid accrued and accumulated dividends thereon, was convertible (at a conversion price of $117.50 per share) into an additional approximate 4,395,281 shares of Ashford Inc. common stock, which if converted as of December 31, 2024, would have increased the Bennetts’ ownership interest in Ashford Inc. to 84.9%.
Series D Convertible Preferred Stock, which, along with all unpaid accrued and accumulated dividends thereon, was convertible (at a conversion price of $117.50 per share) into an additional approximate 4,573,359 shares of Ashford Inc. common stock, which if converted as of December 31, 2025, would have increased the Bennetts’ ownership interest in Ashford Inc. to 87.8%.
As of December 31, 2024, the Bennetts owned approximately 809,937 shares of Ashford Inc. common stock, which represented an approximate 46.6% ownership interest in Ashford Inc., and owned 18,758,600 shares of Ashford Inc.
As of December 31, 2025, the Bennetts owned approximately 809,937 shares of Ashford Inc. common stock, which represented an approximate 51.9% ownership interest in Ashford Inc., and owned 18,758,600 shares of Ashford Inc.
Increased competition could have a material adverse effect on the occupancy rate, average daily room rate and revenue per available room of our hotels or may require us to make capital improvements that we otherwise would not have to make, which may result in decreases in our profitability.
Increased competition could have a material adverse effect on the occupancy rate, average daily room rate and revenue per available room of our hotels or may require us to make capital improvements that we otherwise would not have to make, which may result in decreases in our profitability. 6 Our principal competitors include other hotel operating companies, ownership companies and national and international hotel brands.
Advisory services which would otherwise be provided by employees are provided by subsidiaries of Ashford Inc. and by our appointed officers. Subsidiaries of Ashford Inc. have approximately 101 full-time employees who provide advisory services to us.
Our appointed officers are provided by Ashford LLC, a subsidiary of Ashford Inc. (collectively, our “advisor”). Advisory services which would otherwise be provided by employees are provided by subsidiaries of Ashford Inc. and by our appointed officers. Subsidiaries of Ashford Inc. currently have approximately 82 full-time employees who provide advisory services to us.
To the extent that it is consistent with maintaining our REIT status, we may maintain accumulated earnings of Ashford TRS in that entity. On December 10, 2024, our board of directors reviewed and approved our 2025 dividend policy.
To the extent that it is consistent with maintaining our REIT status, we may maintain accumulated earnings of Ashford TRS in that entity. On December 15, 2025, our board of directors reviewed and approved our 2026 dividend policy. We do not anticipate paying any dividends on our outstanding common stock for any quarter during 2026.
We do not operate any of our hotel properties directly; instead, we contractually engage hotel management companies to operate them for us under management contracts. Remington Hospitality, a subsidiary of Ashford Inc., manages 50 of our 69 3 hotel properties and three of the four Stirling OP hotel properties. Third-party management companies manage the remaining hotel properties.
All of the services that might be provided by employees are provided to us by Ashford LLC. 3 We do not operate any of our hotel properties directly; instead, we contractually engage hotel management companies to operate them for us under management contracts. Remington Hospitality manages 50 of our 68 hotel properties. Third-party management companies manage the remaining hotel properties.
Our principal competitors include other hotel operating companies, ownership companies and national and international hotel brands. We face increased competition from providers of less expensive accommodations, such as select-service hotels or independent owner-managed hotels, during periods of economic downturn when leisure and business travelers become more sensitive to room rates.
We face increased competition from providers of less expensive accommodations, such as select-service hotels or independent owner-managed hotels, during periods of economic downturn when leisure and business travelers become more sensitive to room rates. We also experience competition from alternative types of accommodations such as home sharing companies and apartment operators offering short-term rentals. EMPLOYEES We have no employees.
As of December 31, 2024, our 69 hotel properties and four Stirling OP hotel properties were leased or owned by our wholly owned or majority owned subsidiaries that are treated as taxable REIT subsidiaries for U.S. federal income tax purposes (collectively, these subsidiaries are referred to as “Ashford TRS”).
As of December 31, 2025, our 68 operating hotel properties were leased by our wholly-owned or majority-owned subsidiaries, which are treated as taxable REIT subsidiaries for U.S. federal income tax purposes (collectively, these subsidiaries are referred to as “Ashford TRS”). Ashford TRS then engages third-party or affiliated hotel management companies to operate the hotels under management contracts.
The 18,758,600 shares of Series D Convertible Preferred Stock owned by Mr. Monty J. Bennett and Mr. Archie Bennett, Jr. include 360,000 shares owned by trusts.
The 18,758,600 shares of Series D Convertible Preferred Stock owned by Mr. Monty J. Bennett and Mr. Archie Bennett, Jr. include 360,000 shares owned by trusts. Additionally, Mr. Monty J. Bennett acquired the right to direct votes, effective March 25, 2025, and as of December 31, 2025, those rights represented approximately 551,000 common shares.
The last day of trading of Ashford Inc. common stock on the NYSE American was July 26, 2024. Liquidity As of December 31, 2024, the Company held cash and cash equivalents of $112.9 million and restricted cash of $107.6 million (including amounts held for sale). The vast majority of the restricted cash comprises lender and manager held reserves.
Liquidity As of December 31, 2025, the Company held cash and cash equivalents of $66.8 million and restricted cash of $149.6 million (including amounts held for sale). The vast majority of the restricted cash comprises lender and manager held reserves.
Ashford TRS then engages third-party or affiliated hotel management companies to operate the hotels under management contracts. Hotel operating results related to these properties are included in the consolidated statements of operations. We are advised by Ashford LLC, a subsidiary of Ashford Inc., through an advisory agreement.
Hotel operating results related to these properties are included in the consolidated statements of operations. We are advised by Ashford LLC, a subsidiary of Ashford Inc., through an advisory agreement. All of the hotel properties in our portfolio are currently asset-managed by Ashford LLC. We do not have any employees.
Removed
All of the hotel properties in our portfolio are currently asset-managed by Ashford LLC. We do not have any employees. All of the services that might be provided by employees are provided to us by Ashford LLC.
Added
Further, to preserve the Company’s liquidity position as it evaluates strategic alternatives, preferred dividends have been suspended, including dividends previously declared for recordholders of the Company’s Series D, F, G, H, I, J, K, L and M preferred stock as of December 31, 2025, and payable on January 15, 2026.
Removed
Ashford Inc. has filed a Rule 13e-3 Transaction Statement on Schedule 13E-3 and, on July 29, 2024, effected a reverse and forward stock split as part of a plan to deregister Ashford Inc.’s common stock under the Exchange Act and delist its common stock from the NYSE American LLC (the “NYSE American”).
Added
We intend to pay the previously declared but unpaid dividends as soon as reasonably practicable. Any accrued but unpaid dividends will accrue in accordance with the terms outlined in the applicable governing documents for each series of preferred stock. We will continue to evaluate potential future dividends on a quarterly basis.
Removed
As of March 19, 2025, the Company had no accumulated unpaid dividends on its outstanding preferred stock.
Added
SHAREHOLDER RIGHTS PLAN On December 15, 2025, the Board declared a dividend of one preferred share purchase right (a “Right”) for each outstanding share of common stock, each Right initially representing the right to purchase from the Company one one thousandth of a share of Series N Junior Participating Preferred Stock, par value $0.01 per share, of the Company (the “Series N Preferred Stock”) at a price of $20.00 per one one-thousandth of a share of Series N Preferred Stock (the “Purchase Price”), subject to adjustment as provided in the Rights Agreement (defined below).
Removed
We do not anticipate paying any dividends on our outstanding common stock for any quarter during 2025 and expect to pay dividends on our outstanding Preferred Stock (as defined below) during 2025.
Added
The dividend was paid to holders of Common Stock of record as of 5:00 p.m. New York City time on December 26, 2025 (the “Record Date”).
Removed
We also experience competition from alternative types of accommodations such as home sharing companies and apartment operators offering short-term rentals. 6 EMPLOYEES We have no employees. Our appointed officers are provided by Ashford LLC, a subsidiary of Ashford Inc. (collectively, our “advisor”).
Added
The description and terms of the Rights are set forth in a Rights Agreement, dated as of December 15, 2025, as the same may be amended from time to time (the “Rights Agreement”), between the Company and ComputerShare Trust Company, N.A., as rights agent.
Added
Rights were issued in respect of all outstanding shares of common stock on the Record Date, and will be issued for all shares of common stock issued after the Record Date and, subject to the terms described in the Rights Agreement, prior to the earliest of the Distribution Date (as defined below), the redemption of the Rights or the expiration of the Rights as provided by the Rights Agreement.
Added
The Rights Agreement is designed to prevent the Company from facing a substantial limitation on its ability to use its Tax Benefits (as such term is defined in the Rights Agreement) to offset potential future income taxes for federal income tax purposes and realize other efficiencies.
Added
Subject to certain exceptions specified in the Rights Agreement, the Rights will separate from the common stock and become exercisable at 5:00 p.m.
Added
New York City time on the next business day following the earlier of (i) the first date of public announcement by the Company that any person or group of affiliated or associated persons has become an Acquiring Person (as defined below) pursuant to the Rights Agreement, which announcement makes express reference to such status as an Acquiring Person pursuant to the Rights Agreement, or on such later date as the Board may fix by resolution adopted prior to date, or (ii) 10 business days after the date (prior to such time as any person or group of affiliated persons becomes an Acquiring Person), if any, as may be determined by action of the Board, in its sole discretion, following the commencement of, or public announcement of an intention to commence, a tender or exchange offer the consummation of which would result in any person or group of affiliated or associated persons becoming an Acquiring Person (the earlier of such dates being called the “Distribution Date”).
Added
A person or group of affiliated or associated persons becomes an “Acquiring Person” upon acquiring beneficial ownership of 4.99% or more of any class of Company Securities then outstanding, except in certain situations (including a person or group of affiliated or associated persons that as of December 15, 2025 had beneficial ownership of any class of Company Securities then outstanding in excess of such threshold unless and until such person or group becomes the beneficial owner of a percentage of any class of Company Securities outstanding that exceeds by 0.5% or more the percentage of any class of Company Securities outstanding that such person or group owned as of the first public announcement of the adoption of the Rights Agreement, and any person or group exempted by the Board).
Added
For purposes of the Rights Agreement, “Company Securities” means the common stock and any other interest that the Board determines would be treated as “stock” of the Company for purposes of Section 382 of the Code (including Treasury Regulation Sections 1.382-2(a)(3) and 1.382-2T(f)(18)). 9 Until the Distribution Date (or earlier redemption or expiration of the Rights), the Rights will be transferred with and only with the common stock.
Added
As soon as practicable following the Distribution Date, separate certificates evidencing the Rights will be mailed to holders of record of the common stock as of the close of business on the Distribution Date and such separate right certificates alone will evidence the Rights. The Rights are not exercisable until the Distribution Date.
Added
Pursuant to the terms of the Rights Agreement, the Rights will expire on the earliest of (i) 5:00 p.m.
Added
New York City time on December 14, 2026, (ii) the effective date of the repeal of Section 382 of the Code or any successor statute if the Board determines in its sole discretion that the Rights Agreement is no longer necessary or desirable for the preservation of Tax Benefits, or (iii) the first day of a taxable year of the Company to which the Board determines in its sole discretion that no Tax Benefits may be carried forward, unless the Rights are earlier redeemed or exchanged by the Company, in each case as described below, or upon the occurrence of certain transactions.
Added
Because of the nature of the Series N Preferred Stock’s dividend, liquidation and voting rights, the value of the one one-thousandth interest in a share of Series N Preferred Stock purchasable upon exercise of each Right should approximate the value of one share of Common Stock.
Added
If issued, each Right, other than Rights beneficially owned by the Acquiring Person (which will thereupon become void) will become exercisable for common stock having a value equal to two times the exercise price of the Right.
Added
However, prior to exercise, a Right does not give its holder any rights as a stockholder of the Company, including without limitation any dividend, voting or liquidation rights.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

110 edited+51 added−20 removed412 unchanged
Biggest changeThese risks are discussed more fully below and include, but are not limited to, risks related to: • general volatility of the capital markets and the market price of our common stock and preferred stock; • catastrophic events or geopolitical conditions, such as the conflict between Russia and Ukraine, the Israel-Hamas war and changes to tariffs or trade policies; • availability, terms, and deployment of capital; • unanticipated increases in financing and other costs, including changes in interest rates or inflation; • actual and potential conflicts of interest with Ashford Inc. and its subsidiaries (including Ashford LLC, Remington Hospitality and Premier), Braemar, Stirling Inc., our executive officers and our non-independent directors; • changes in personnel of Ashford LLC or the lack of availability of qualified personnel; • changes in governmental regulations, accounting rules, tax rates and similar matters; • legislative and regulatory changes, including changes to the Code, and related rules, regulations and interpretations governing the taxation of real estate investment trusts; • limitations imposed on our business and our ability to satisfy complex rules in order for us to qualify as a REIT for U.S. federal income tax purposes; and • future sales and issuances of our common stock or other securities might result in dilution and could cause the price of our common stock to decline.
Biggest changeThese risks are discussed more fully below and include, but are not limited to, risks related to: • general volatility of the capital markets and the market price of our common stock and preferred stock; • catastrophic events or geopolitical conditions, such as the conflict between Russia and Ukraine, the Israel-Palestine-Iran conflict, ongoing instability in Venezuela and changes to tariffs or trade policies; • availability, terms, and deployment of capital; • unanticipated increases in financing and other costs, including changes in interest rates or inflation; • actual and potential conflicts of interest with Ashford Inc. and its subsidiaries (including Ashford LLC, Remington Hospitality and Premier), Braemar, our executive officers and our non-independent directors; • changes in personnel of Ashford LLC or the lack of availability of qualified personnel; • changes in governmental regulations, accounting rules, tax rates and similar matters; • our ability to continue as a going concern as described in our financial statement footnotes and generate sufficient liquidity to satisfy our obligations as they become due; • legislative and regulatory changes, including changes to the Code, and related rules, regulations and interpretations governing the taxation of real estate investment trusts; • limitations imposed on our business and our ability to satisfy complex rules in order for us to qualify as a REIT for U.S. federal income tax purposes; • the Rights Agreement adopted in December 2025 to protect our Tax Benefits may delay or prevent unsolicited acquisitions of us, or may adversely affect the market for our common stock; • future sales and issuances of our common stock or other securities might result in dilution and could cause the price of our common stock to decline; and • we are not currently eligible to use our effective short form registration statement on Form S-3 or to file a new Form S-3, which may impair our capital raising activities.
For example, our board of directors can do the following: • amend or revise at any time our dividend policy with respect to our common stock or preferred stock (including by eliminating, failing to declare, or significantly reducing dividends on these securities); • terminate our advisor under certain conditions pursuant to the advisory agreement, subject to the payment of a termination fee; • amend or revise at any time and from time to time our investment, financing, borrowing and dividend policies and our policies with respect to all other activities, including growth, debt, capitalization and operations, subject to the limitations and restrictions provided in our advisory agreement and mutual exclusivity agreement; • amend our policies with respect to conflicts of interest provided that such changes are consistent with applicable legal requirements; • subject to the terms of our charter, prevent the ownership, transfer and/or accumulation of shares in order to protect our status as a REIT or for any other reason deemed to be in the best interests of us and our stockholders; • issue additional shares without obtaining stockholder approval, which could dilute the ownership of our then-current stockholders; • subject to the terms of any outstanding classes or series of preferred stock, classify or reclassify any unissued shares of our common stock or preferred stock and set the preferences, rights and other terms of such classified or reclassified shares, without obtaining stockholder approval; • employ and compensate affiliates (subject to disinterested director approval); 38 • direct our resources toward investments that do not ultimately appreciate over time; and • determine that it is not in our best interests to attempt to qualify, or to continue to qualify, as a REIT.
For example, our board of directors can do the following: • amend or revise at any time our dividend policy with respect to our common stock or preferred stock (including by eliminating, failing to declare, or significantly reducing dividends on these securities); • terminate our advisor under certain conditions pursuant to the advisory agreement, subject to the payment of a termination fee; • amend or revise at any time and from time to time our investment, financing, borrowing and dividend policies and our policies with respect to all other activities, including growth, debt, capitalization and operations, subject to the limitations and restrictions provided in our advisory agreement and mutual exclusivity agreement; • amend our policies with respect to conflicts of interest provided that such changes are consistent with applicable legal requirements; • subject to the terms of our charter, prevent the ownership, transfer and/or accumulation of shares in order to protect our status as a REIT or for any other reason deemed to be in the best interests of us and our stockholders; • issue additional shares without obtaining stockholder approval, which could dilute the ownership of our then-current stockholders; • subject to the terms of any outstanding classes or series of preferred stock, classify or reclassify any unissued shares of our common stock or preferred stock and set the preferences, rights and other terms of such classified or reclassified shares, without obtaining stockholder approval; • employ and compensate affiliates (subject to disinterested director approval); • direct our resources toward investments that do not ultimately appreciate over time; and • determine that it is not in our best interests to attempt to qualify, or to continue to qualify, as a REIT.
If we terminate the advisory agreement without cause or upon a change of control, we will be required to pay our advisor a termination fee equal to: • (A) 1.1 multiplied by the greater of (i) 12 times the net earnings of our advisor for the 12 month period preceding the termination date of the advisory agreement; (ii) the earnings multiple (calculated as our advisor’s total enterprise value on the trading day immediately preceding the day the termination notice is given to our advisor divided by our advisor’s most recently reported adjusted earnings before interest, tax, depreciation and amortization (“Adjusted EBITDA”)) for our advisor’s common stock for the 12 month period preceding the termination date of the advisory agreement multiplied by the net earnings of our advisor for the 12 month period preceding the termination date of the advisory agreement; or (iii) the simple average of the earnings multiples for each of the three fiscal years preceding the termination of the advisory agreement (calculated as our advisor’s total enterprise value on the last trading day of each of the three preceding fiscal years divided by, in each case, our advisor’s Adjusted EBITDA for the same periods), multiplied by the net earnings of our advisor for the 12 month period preceding the termination date of the advisory agreement; plus • (B) an additional amount such that the total net amount received by our advisor after the reduction by state and U.S. federal income taxes at an assumed combined rate of 40% on the sum of the amounts described in (A) and (B) shall equal the amount described in (A); provided, that, the minimum amount of any termination fee calculated as of any date of determination shall be the greater of (i) the fee that would have been payable had such termination fee been calculated as of December 31, 2023 and (ii) the fee calculated as of such date of determination.
If we terminate the advisory agreement without cause or upon a change of control, we will be required to pay our advisor a termination fee equal to: • (A) 1.1 multiplied by the greater of (i) 12 times the net earnings of our advisor for the 12 month period preceding the termination date of the advisory agreement; (ii) the earnings multiple (calculated as our advisor’s total enterprise value on the trading day immediately preceding the day the termination notice is given to our advisor divided by our advisor’s most recently reported adjusted earnings before interest, tax, depreciation and amortization (“Adjusted EBITDA”)) for our advisor’s common stock for the 12 month period preceding the termination date of the advisory agreement multiplied by the net earnings of our advisor for the 12 month period preceding the termination date of the advisory agreement; or (iii) the simple average of the earnings multiples for each of the three fiscal years preceding the termination of the advisory agreement (calculated as our advisor’s total enterprise value on the last trading day of each of the three preceding fiscal years divided by, in each case, our advisor’s Adjusted EBITDA for the same periods), multiplied by the net earnings of our advisor for the 12 month period preceding the termination date of the advisory agreement; plus • (B) an additional amount such that the total net amount received by our advisor after the reduction by state and U.S. federal income taxes at an assumed combined rate of 40% on the sum of the amounts described in (A) and (B) shall equal the amount described in (A); provided, that, the minimum amount of any termination fee calculated as of any date of determination shall be the greater of (i) the fee that would have been payable had such termination fee been calculated as of December 31, 2025 and (ii) the fee calculated as of such date of determination.
Mortgages and other investments 13 are often obtained through a competitive bidding process. In addition, competitors may seek to establish relationships with the financial institutions and other firms from which we intend to purchase such assets. Competition may result in higher prices for mortgage assets, lower yields, and a narrower spread of yields over our borrowing costs.
Mortgages and other investments are often obtained through a competitive bidding process. In addition, competitors may seek to establish relationships with the financial institutions and other firms from which we intend to purchase such assets. Competition may result in higher prices for mortgage assets, lower yields, and a narrower spread of yields over our borrowing costs.
If we fail to satisfy the REIT gross income tests, unless our failure was due to reasonable cause and not due to willful neglect such that a REIT “savings clause” applied, we could lose our REIT status for U.S. federal income tax purposes. 33 Complying with REIT requirements may force us to liquidate otherwise attractive investments.
If we fail to satisfy the REIT gross income tests, unless our failure was due to reasonable cause and not due to willful neglect such that a REIT “savings clause” applied, we could lose our REIT status for U.S. federal income tax purposes. Complying with REIT requirements may force us to liquidate otherwise attractive investments.
In the event of a breach of this representation, Braemar may be able to seek damages from us, which could have a significantly negative effect on our liquidity and results of operations. Declines in the values of our investments may make it more difficult for us to maintain our qualification as a REIT or exemption from the Investment Company Act.
In the event of a breach of this representation, Braemar may be able to seek damages from us, which could have a significantly negative effect on our liquidity and results of operations. 37 Declines in the values of our investments may make it more difficult for us to maintain our qualification as a REIT or exemption from the Investment Company Act.
Acquisitions of any property or additional portfolios of properties could generate additional operating expenses for us. Any future acquisitions may also require us to enter into property improvement plans that will increase our use of cash and could disrupt performance. As we acquire additional 11 assets, we will be subject to the operational risks associated with owning those assets.
Acquisitions of any property or additional portfolios of properties could generate additional operating expenses for us. Any future acquisitions may also require us to enter into property improvement plans that will increase our use of cash and could disrupt performance. As we acquire additional assets, we will be subject to the operational risks associated with owning those assets.
In addition, rising interest rates would result in increased interest expense on our variable-rate debt, thereby adversely affecting cash flow and our ability to service our indebtedness and pay dividends. Our board of directors can take many actions without stockholder approval. Our board of directors has overall authority to oversee our operations and determine our major corporate policies.
In addition, rising interest rates would result in increased interest expense on our variable-rate debt, thereby adversely affecting cash flow and our ability to service our indebtedness and pay dividends. 40 Our board of directors can take many actions without stockholder approval. Our board of directors has overall authority to oversee our operations and determine our major corporate policies.
Although most of the business for our hotels is expected to be derived from traditional channels, if the amount of sales made through Internet intermediaries increases significantly, rooms revenue may be lower than expected, and we may be adversely affected. We may be adversely affected by increased use of business-related technology, which may reduce the need for business-related travel.
Although most of the business for our hotels is expected to be derived from traditional channels, if the amount of sales made through Internet intermediaries increases significantly, rooms revenue may be lower than expected, and we may be adversely affected. 21 We may be adversely affected by increased use of business-related technology, which may reduce the need for business-related travel.
To the extent that such technologies play an increased role in day-to-day business and the necessity for business-related travel decreases, hotel room demand may decrease and we may be adversely affected. 19 Our hotels may be subject to unknown or contingent liabilities which could cause us to incur substantial costs.
To the extent that such technologies play an increased role in day-to-day business and the necessity for business-related travel decreases, hotel room demand may decrease and we may be adversely affected. Our hotels may be subject to unknown or contingent liabilities which could cause us to incur substantial costs.
The more favorable rates applicable to regular corporate qualified dividends could cause investors who are taxed at individual rates to perceive investments in REITs to be relatively less attractive than investments in the stocks 32 of non-REIT corporations that pay dividends, which could adversely affect the value of the shares of REITs, including our stock.
The more favorable rates applicable to regular corporate qualified dividends could cause investors who are taxed at individual rates to perceive investments in REITs to be relatively less attractive than investments in the stocks of non-REIT corporations that pay dividends, which could adversely affect the value of the shares of REITs, including our stock.
In an economic downturn, these types of hotels may be more susceptible to a decrease in revenue, as compared to hotels in other categories that have lower room rates. This characteristic may result from the fact that upscale and upper upscale hotels generally target business and high-end leisure travelers.
In an economic downturn, these types of hotels may be more susceptible to a decrease in revenue, as compared to hotels in other categories that have lower room rates. This characteristic may result from the fact that upscale and upper upscale hotels 10 generally target business and high-end leisure travelers.
When we enter into or acquire properties subject to any such management agreements, we may be precluded from taking actions in our best interest and could incur substantial expense as a result of the agreements. If we cannot obtain additional capital, our growth will be limited.
When we enter into or acquire properties subject to any such 14 management agreements, we may be precluded from taking actions in our best interest and could incur substantial expense as a result of the agreements. If we cannot obtain additional capital, our growth will be limited.
Although a safe harbor to the characterization of the sale of real property by a REIT as a prohibited transaction is available, we cannot assure you that we can comply with the safe harbor or that we will avoid owning property that may be characterized as 34 held primarily for sale to customers in the ordinary course of business.
Although a safe harbor to the characterization of the sale of real property by a REIT as a prohibited transaction is available, we cannot assure you that we can comply with the safe harbor or that we will avoid owning property that may be characterized as held primarily for sale to customers in the ordinary course of business.
These instruments involve risks, such as the risk 16 that the counterparties may fail to honor their obligations under these arrangements, that these arrangements may not be effective in reducing our exposure to interest rate changes or other risks and that a court could rule that such agreements are not legally enforceable.
These instruments involve risks, such as the risk that the counterparties may fail to honor their obligations under these arrangements, that these arrangements may not be effective in reducing our exposure to interest rate changes or other risks and that a court could rule that such agreements are not legally enforceable.
The termination fee makes it more difficult for us to terminate our advisory agreement. These provisions significantly increase the cost to us of terminating our advisory agreement, thereby limiting our ability to terminate our advisor without cause. Our advisor manages other entities and may direct attractive investment opportunities away from us.
The termination fee makes it more difficult for us to terminate our advisory agreement. These provisions significantly increase the cost to us of terminating our advisory agreement, thereby limiting our ability to terminate our advisor without cause. 23 Our advisor manages other entities and may direct attractive investment opportunities away from us.
We do not currently intend to pay taxable dividends of our common stock and cash, although we may choose to do so in the future. The prohibited transactions tax may limit our ability to dispose of our properties. A REIT’s net income from prohibited transactions is subject to a 100% tax.
We do not currently intend to pay taxable dividends of our common stock and cash, although we may choose to do so in the future. 36 The prohibited transactions tax may limit our ability to dispose of our properties. A REIT’s net income from prohibited transactions is subject to a 100% tax.
Nevertheless, we are subject to the risk that such insurance will not fully cover all losses and, depending on the severity of the event and the impact on our properties, such insurance may not cover a significant portion of the losses including but not limited to the costs associated with evacuation.
Nevertheless, we are subject to the risk that such insurance will not fully cover all losses and, depending on the severity of the event and the impact on our properties, such insurance may not cover a significant portion of the losses including 16 but not limited to the costs associated with evacuation.
Any one of these options could have a material adverse effect on our business, financial condition, results of operations and our ability to make distributions to our stockholders. If we sell a hotel, the required loan repayment may exceed the sale proceeds.
Any one of these options could have a material adverse effect on our business, 18 financial condition, results of operations and our ability to make distributions to our stockholders. If we sell a hotel, the required loan repayment may exceed the sale proceeds.
Our advisor and its key employees, most of whom are Stirling Inc.’s, Braemar’s, Ashford Inc.’s and our executive officers, face competing demands relating to their time and this may adversely affect our operations. We rely on our advisor and its employees for the day-to-day operation of our business.
Our advisor and its key employees, most of whom are Braemar’s and Ashford Inc.’s and our executive officers, face competing demands relating to their time and this may adversely affect our operations. We rely on our advisor and its employees for the day-to-day operation of our business.
For these reasons, there can be no assurances as to the value to be realized by the Company from these transactions or any future similar transactions. 18 The hotel business is seasonal, which affects our results of operations from quarter to quarter. The hotel industry is seasonal in nature.
For these reasons, there can be no assurances as to the value to be realized by the Company from these transactions or any future similar transactions. The hotel business is seasonal, which affects our results of operations from quarter to quarter. The hotel industry is seasonal in nature.
The maximum U.S. federal income tax rate applicable to “qualified dividend income” payable to U.S. stockholders that are taxed at individual rates is 20%. Dividends payable by REITs, however, generally are not eligible for this reduced maximum rate on qualified dividend income.
The maximum U.S. federal income tax rate applicable to “qualified dividend income” payable to U.S. stockholders that are taxed at individual rates is 20%. Dividends payable by REITs, however, generally are not eligible for this reduced maximum 34 rate on qualified dividend income.
The loss of services of one or more members of our advisor’s management team could harm our business and our prospects. 10 We do not have any employees, and rely on our hotel managers to employ the personnel required to operate the hotels we own.
The loss of services of one or more members of our advisor’s management team could harm our business and our prospects. We do not have any employees, and rely on our hotel managers to employ the personnel required to operate the hotels we own.
We are unable to 14 predict how this or any other future legislative or regulatory proposals or programs will be administered or implemented or in what form, or whether any additional or similar changes to statutes or regulations, including the interpretation or implementation thereof, will occur in the future.
We are unable to predict how this or any other future legislative or regulatory proposals or programs will be administered or implemented or in what form, or whether any additional or similar changes to statutes or regulations, including the interpretation or implementation thereof, will occur in the future.
Bennett, our chairman, is also the chief executive officer, chairman and a significant stockholder of our advisor and is the chairman of Braemar. Our advisory agreement requires our advisor to present investments that satisfy our 21 investment guidelines to us before presenting them to Braemar or any future client of our advisor.
Bennett, our chairman, is also the chief executive officer, chairman and a significant stockholder of our advisor and is the chairman of Braemar. Our advisory agreement requires our advisor to present investments that satisfy our investment guidelines to us before presenting them to Braemar or any future client of our advisor.
Many factors beyond our control are likely to influence the yield on the investments, including, but not limited to, competitive conditions in the local real estate market, local and general economic conditions, and the quality of management of the underlying property.
Many factors beyond our control are likely to influence the yield on the investments, including, but not limited to, competitive conditions in the local real estate market, local and general economic conditions, and the quality 28 of management of the underlying property.
Our inability to accurately assess investment yields may result in our purchasing assets that do not perform as well as expected, which may adversely affect the price of our securities. 26 Volatility of values of mortgaged properties may adversely affect our mortgage loans.
Our inability to accurately assess investment yields may result in our purchasing assets that do not perform as well as expected, which may adversely affect the price of our securities. Volatility of values of mortgaged properties may adversely affect our mortgage loans.
If we were to violate the 25% or 5% limitations, we may have to pay a penalty tax equal to the amount of income in excess of those limitations multiplied by a fraction intended to reflect our profitability.
If we were to violate the 25% or 5% limitations, we may have to pay a penalty tax equal to the amount of income in excess of 35 those limitations multiplied by a fraction intended to reflect our profitability.
Upon liquidation, holders of our debt securities or preferred units and lenders with 37 respect to other borrowings will receive a distribution of our available assets prior to the holders of shares of preferred stock or common stock.
Upon liquidation, holders of our debt securities or preferred units and lenders with respect to other borrowings will receive a distribution of our available assets prior to the holders of shares of preferred stock or common stock.
During 2024, approximately 15% of our total hotel revenue was generated from nine hotels located in the Washington D.C. area, one of several key U.S. markets considered vulnerable to terrorist attack. Our financial and operating performance may be adversely affected by potential terrorist attacks. Terrorist attacks in the future may cause our results to differ materially from anticipated results.
During 2025, approximately 15% of our total hotel revenue was generated from nine hotels located in the Washington D.C. area, one of several key U.S. markets considered vulnerable to terrorist attack. Our financial and operating performance may be adversely affected by potential terrorist attacks. Terrorist attacks in the future may cause our results to differ materially from anticipated results.
The relative illiquidity of such investments may make it difficult for us to dispose of them at a favorable price, and, as a result, we may suffer losses. 27 RISKS RELATED TO THE REAL ESTATE INDUSTRY Illiquidity of real estate investments could significantly impede our ability to respond to adverse changes in the performance of our hotel properties and harm our financial condition.
The relative illiquidity of such investments may make it difficult for us to dispose of them at a favorable price, and, as a result, we may suffer losses. 29 RISKS RELATED TO THE REAL ESTATE INDUSTRY Illiquidity of real estate investments could significantly impede our ability to respond to adverse changes in the performance of our hotel properties and harm our financial condition.
However, given the authority 22 and/or operational latitude provided to Remington Hospitality under the master hotel management agreement and to Premier under the master project management agreement, and Mr. Monty J.
However, given the authority and/or operational latitude provided to Remington Hospitality under the master hotel management agreement and to Premier under the master project management agreement, and Mr. Monty J.
In doing so, we have made decisions with respect to what deductibles, policy limits, and terms are 29 reasonable based on management’s experience, our risk profile, the loss history of our hotel managers and our properties, the nature of our properties and our businesses, our loss prevention efforts, the cost of insurance and other factors.
In doing so, we have made decisions with respect to what deductibles, policy limits, and terms are 31 reasonable based on management’s experience, our risk profile, the loss history of our hotel managers and our properties, the nature of our properties and our businesses, our loss prevention efforts, the cost of insurance and other factors.
Similarly, pursuant to our hotel management agreement with Remington Hospitality, a subsidiary of Ashford Inc., we pay Remington Hospitality monthly base hotel management fees on a per hotel basis equal to the greater of approximately $17,000 (increased annually based on consumer price index adjustments) or 3% of gross revenues.
Similarly, pursuant to our hotel management agreement with Remington Hospitality, a subsidiary of Ashford Inc., we pay Remington Hospitality monthly base hotel management fees on a per hotel basis equal to the greater of approximately $18,000 (increased annually based on consumer price index adjustments) or 3% of gross revenues.
In addition, we 28 generally do not require our borrowers to obtain environmental insurance on the properties they own that secure their loans from us. Numerous treaties, laws and regulations have been enacted to regulate or limit carbon emissions.
In addition, we 30 generally do not require our borrowers to obtain environmental insurance on the properties they own that secure their loans from us. Numerous treaties, laws and regulations have been enacted to regulate or limit carbon emissions.
In addition, in periods of weak demand, as may occur during a general economic recession, profitability is negatively affected by the fixed costs of operating hotels. We also face competition from services such as home sharing companies and apartment operators offering short-term rentals. We did not pay dividends on our common stock in fiscal year 2024.
In addition, in periods of weak demand, as may occur during a general economic recession, profitability is negatively affected by the fixed costs of operating hotels. We also face competition from services such as home sharing companies and apartment operators offering short-term rentals. We did not pay cash dividends on our common stock in fiscal year 2025.
As a result of all of these factors, 30 our failure to qualify as a REIT could impair our ability to raise capital, expand our business, and make distributions to our stockholders and could adversely affect the value of our securities.
As a result of all of these factors, 32 our failure to qualify as a REIT could impair our ability to raise capital, expand our business, and make distributions to our stockholders and could adversely affect the value of our securities.
Such renovation and development involves substantial risks, including: • construction cost overruns and delays; • the disruption of operations at, displacement of revenue at and damage to our operating hotels, including revenue lost while rooms, restaurants or meeting space under renovation are out of service; • increases in operating costs at our hotels, to the extent they rely on portions of development sites for hotel operations; • the cost of funding renovations or developments and inability to obtain financing on attractive terms; • the return on our investment in these capital improvements or developments failing to meet expectations; • governmental restrictions on the nature or size of a project; • inability to obtain all necessary zoning, land use, building, occupancy, and construction permits; • loss of substantial investment in a development project if a project is abandoned before completion; • acts of God such as earthquakes, hurricanes, floods or fires that could adversely affect a project; • environmental problems; • disputes with franchisors or hotel managers regarding compliance with relevant franchise agreements or management agreements; and • development-related liabilities, such as claims for design/construction defects.
Such renovation and development involves substantial risks, including: • construction cost overruns and delays; • the disruption of operations at, displacement of revenue at and damage to our operating hotels, including revenue lost while rooms, restaurants or meeting space under renovation are out of service; • increases in operating costs at our hotels, to the extent they rely on portions of development sites for hotel operations; • the cost of funding renovations or developments and inability to obtain financing on attractive terms; • the return on our investment in these capital improvements or developments failing to meet expectations; • governmental restrictions on the nature or size of a project; • inability to obtain all necessary zoning, land use, building, occupancy, and construction permits; • loss of substantial investment in a development project if a project is abandoned before completion; • acts of God such as earthquakes, hurricanes, floods or fires that could adversely affect a project; • environmental problems; • disputes with franchisors or hotel managers regarding compliance with relevant franchise agreements or management agreements; and • development-related liabilities, such as claims for design/construction defects; • supply chain disruptions or labor shortages could further increase costs or delay completion of renovations or development projects.
As of December 31, 2024, 12 of our hotels are in cash traps. There is refinancing risk associated with our debt. We finance our long-term growth and liquidity needs with debt financings having staggered maturities, and use variable-rate debt or a mix of fixed and variable-rate debt as appropriate based on favorable interest rates, principal amortization and other terms.
As of December 31, 2025, 43 of our hotels are in cash traps. There is refinancing risk associated with our debt. We finance our long-term growth and liquidity needs with debt financings having staggered maturities, and use variable-rate debt or a mix of fixed and variable-rate debt as appropriate based on favorable interest rates, principal amortization and other terms.
Economic conditions in the United States could have a material adverse impact on our earnings and financial condition.
Economic conditions in the United States and geopolitical developments could have a material adverse impact on our earnings and financial condition.
Moreover, interest rate hedging could fail to protect us or adversely affect us because, among other things: • available interest rate hedging may not correspond directly with the interest rate risk for which protections is sought; • the duration of the hedge may not match the duration of the related liability; • the party owing money in the hedging transaction may default on its obligation to pay; • the credit quality of the party owing money on the hedge may be downgraded to such an extent that it impairs our ability to sell or assign our side of the hedging transaction; and • the value of derivatives used for hedging may be adjusted from time to time in accordance with generally accepted accounting principles (“GAAP”) to reflect changes in fair value and such downward adjustments, or “market-to-market loss,” would reduce our stockholders’ equity. 24 Hedging involves both risks and costs, including transaction costs, which may reduce our overall returns on our investments.
Moreover, interest rate hedging could fail to protect us or adversely affect us because, among other things: • available interest rate hedging may not correspond directly with the interest rate risk for which protections is sought; • the duration of the hedge may not match the duration of the related liability; • the party owing money in the hedging transaction may default on its obligation to pay; 26 • the credit quality of the party owing money on the hedge may be downgraded to such an extent that it impairs our ability to sell or assign our side of the hedging transaction; and • the value of derivatives used for hedging may be adjusted from time to time in accordance with generally accepted accounting principles (“GAAP”) to reflect changes in fair value and such downward adjustments, or “market-to-market loss,” would reduce our stockholders’ equity.
Our only significant asset is and will be the general and limited partnership interests of our operating partnership. We conduct, and intend to continue to conduct, all of our business operations through our operating partnership.
We have no business operations of our own. Our only significant asset is and will be the general and limited partnership interests of our operating partnership. We conduct, and intend to continue to conduct, all of our business operations through our operating partnership.
We are increasingly dependent on information technology, and cyber-attacks, security problems or other disruption and expanding social media vehicles present new risks.
We are increasingly dependent on information technology, and cyber-attacks, security problems, artificial intelligence-related risks, or other disruption and expanding social media vehicles present new risks.
RISKS RELATED TO OUR DEBT FINANCING We have a significant amount of debt, and our organizational documents have no limitation on the amount of additional indebtedness that we may incur in the future. As of December 31, 2024, our outstanding indebtedness consisted of approximately $2.7 billion in property-level debt, including approximately $2.5 billion of variable interest rate debt.
RISKS RELATED TO OUR DEBT FINANCING We have a significant amount of debt, and our organizational documents have no limitation on the amount of additional indebtedness that we may incur in the future. As of December 31, 2025, our outstanding indebtedness consisted of approximately $2.6 billion in property-level debt, including approximately $2.4 billion of variable interest rate debt.
Privacy and information security risks have generally increased in recent years because of the proliferation of new technologies, such as ransomware, and the increased sophistication and activities of perpetrators of cyber-attacks.
Privacy and information security risks have generally increased in recent years because of the proliferation of new technologies, such as ransomware and AI-powered attack tools, and the increased sophistication and activities of perpetrators of cyber-attacks.
As of December 31, 2024, our outstanding indebtedness consisted of approximately $2.7 billion in property-level debt, including approximately $2.5 billion of variable interest rate debt. Higher interest rates in the past few years have negatively impacted nearly all commercial real estate managers, including the Company.
As of December 31, 2025, our outstanding indebtedness consisted of approximately $2.6 billion in property-level debt, including approximately $2.4 billion of variable interest rate debt. Higher interest rates in the past few years have negatively impacted nearly all commercial real estate managers, including the Company.
Other factors that could negatively affect our business include: terrorist incidents and threats and associated heightened travel security measures; political and regional strife; acts of God such as earthquakes, hurricanes, fires, floods, volcanoes and other natural disasters; war; concerns with or threats of pandemics, contagious diseases or health epidemics, such as COVID-19, Ebola, H1N1 influenza (swine flu), MERS, SARs, avian flu, the Zika virus or similar outbreaks; environmental disasters; lengthy power outages; increased pricing, financial instability and capacity constraints of air carriers; airline job actions and strikes; fluctuations in hotel supply, occupancy and ADR; changes to visa and immigration requirements or border control policies; imposition of taxes or surcharges by regulatory authorities; and increases in gasoline and other fuel prices.
Other factors that could negatively affect our business include: terrorist incidents and threats and associated heightened travel security measures; political and regional strife; acts of God such as earthquakes, hurricanes, fires, floods, volcanoes and other natural disasters; war; concerns with or threats of pandemics, contagious diseases or health epidemics, such as COVID-19, Ebola, H1N1 influenza (swine flu), MERS, SARs, avian flu, the Zika virus or similar outbreaks; environmental disasters; lengthy power outages; increased pricing, financial instability and capacity constraints of air carriers; airline job actions and strikes; fluctuations in hotel supply, occupancy and ADR; changes to visa and immigration requirements or border control policies; imposition of taxes or surcharges by regulatory authorities; and increases in gasoline and other fuel prices. 19 Because these events or concerns, and the full impact of their effects, are largely unpredictable, they can dramatically and suddenly affect travel behavior by consumers and decrease demand.
Archie Bennett, Jr., as of December 31, 2024, holds a controlling interest in Ashford Inc. As of December 31, 2024, the Bennetts owned approximately 809,937 shares of Ashford Inc. common stock, which represented an approximate 46.6% ownership interest in Ashford Inc., and owned 18,758,600 shares of Ashford Inc.
Archie Bennett, Jr., as of December 31, 2025, holds a controlling interest in Ashford Inc. As of December 31, 2025, the Bennetts owned approximately 809,937 shares of Ashford Inc. common stock, which represented an approximate 51.9% ownership interest in Ashford Inc., and owned 18,758,600 shares of Ashford Inc.
A substantial level of indebtedness could have adverse consequences for our business, results of operations and financial position because it could, among other things: • require us to dedicate a substantial portion of our cash flow from operations to make principal and interest payments on our indebtedness, thereby reducing our cash flow available to fund working capital, capital expenditures and other general corporate purposes, including to pay dividends on our common stock and our Preferred Stock as currently contemplated or necessary to satisfy the requirements for qualification as a REIT; • increase our vulnerability to general adverse economic and industry conditions and limit our flexibility in planning for, or reacting to, changes in our business and our industry; • limit our ability to borrow additional funds or refinance indebtedness on favorable terms or at all to expand our business or ease liquidity constraints; and • place us at a competitive disadvantage relative to competitors that have less indebtedness.
A substantial level of indebtedness could have adverse consequences for our business, results of operations and financial position because it could, among other things: • require us to dedicate a substantial portion of our cash flow from operations to make principal and interest payments on our indebtedness, thereby reducing our cash flow available to fund working capital, capital expenditures and other general corporate purposes, including to pay dividends on our common stock and our Preferred Stock as currently contemplated or necessary to satisfy the requirements for qualification as a REIT; • increase our vulnerability to general adverse economic and industry conditions and limit our flexibility in planning for, or reacting to, changes in our business and our industry; • limit our ability to borrow additional funds or refinance indebtedness on favorable terms or at all to expand our business or ease liquidity constraints; and • place us at a competitive disadvantage relative to competitors that have less indebtedness. 17 Our Charter and bylaws do not limit the amount or percentage of indebtedness that we may incur, and we are subject to risks normally associated with debt financing.
As of December 31, 2024, the Company had a deficit in stockholders’ equity of approximately $419.2 million and had not generated current earnings from which a dividend is potentially payable since the year ended December 31, 2015.
As of December 31, 2025, the Company had a deficit in stockholders’ equity of approximately $626.4 million and had not generated current earnings from which a dividend is potentially payable since the year ended December 31, 2015.
Series D Convertible Preferred Stock, which, along with all unpaid accrued and accumulated dividends thereon, was convertible (at a conversion price of $117.50 per share) into an additional approximate 4,395,281 shares of Ashford Inc. common stock, which if converted as of December 31, 2024, would have increased the Bennetts’ ownership interest in Ashford Inc. to 84.9%.
Series D Convertible Preferred Stock, which, along with all unpaid accrued and accumulated dividends thereon, was convertible (at a conversion price of $117.50 per share) into an additional approximate 4,573,359 shares of Ashford Inc. common stock, which if converted as of December 31, 2025, would have increased the Bennetts’ ownership interest in Ashford Inc. to 87.8%.
The Dodd-Frank Act has caused certain market participants, and may cause other market participants, including the counterparties to our derivative instruments, to spin off some of their derivatives activities to separate entities. Those entities may not be as creditworthy as the historical counterparties to our derivatives.
The Dodd-Frank Act has caused certain market participants, and may cause other market participants, including the counterparties to our derivative instruments, to spin off some of their derivatives activities to separate entities.
Ashford LLC and our hotel managers may purchase some of our information technology from vendors, on whom our systems will depend, and Ashford LLC relies on commercially available systems, software, tools and monitoring to provide security for processing, transmission and storage of confidential operator and other customer information. We depend upon the secure transmission of this information over public networks.
Ashford LLC and our hotel managers may purchase some of our information technology from vendors, on whom our systems will depend, and Ashford LLC relies on commercially available systems, software, tools and monitoring to provide security for processing, transmission and storage of confidential operator and other customer information.
In the event of any default under mortgage loans held by us, we will bear the risk of loss of principal and non-payment of interest and fees to the extent of any deficiency between the value of the mortgage collateral and the principal amount of the mortgage loan.
In the event of any default under mortgage loans held by us, we will bear the risk of loss of principal and non-payment of interest and fees to the extent of any deficiency between the value of the mortgage collateral and the principal amount of the mortgage loan. The value and the price of our securities may be adversely affected.
Some of the rules required to implement the swaps-related provisions of the Dodd-Frank Act remain to be adopted, and the CFTC has, from time to time, issued and may in the future issue interpretations and no-action letters interpreting, and clarifying the application of, those provisions and the related rules or delaying compliance with those provisions and rules.
Those entities may not be as creditworthy as the historical counterparties to our derivatives. 27 Some of the rules required to implement the swaps-related provisions of the Dodd-Frank Act remain to be adopted, and the CFTC has, from time to time, issued and may in the future issue interpretations and no-action letters interpreting, and clarifying the application of, those provisions and the related rules or delaying compliance with those provisions and rules.
Despite these steps, there can be no assurance that we will not suffer a significant data security incident in the future, that unauthorized parties will not gain access to sensitive data stored on our systems or that any such incident will be discovered in a timely manner.
Despite these steps, there can be no assurance that we will not suffer a significant data security incident in the future, that unauthorized parties will not gain access to sensitive data stored on our systems, that AI systems we or our vendors use will perform as intended without error or bias, or that any such incident will be discovered in a timely manner.
Economic conditions may be affected by numerous factors, including but not limited to, the pace of economic growth and/or recessionary concerns, inflation, increases in the levels of unemployment, energy prices, tariffs and trade barriers, changes in currency exchange rates, uncertainty about government fiscal and tax policy, geopolitical events, the regulatory environment and the availability of credit and interest rates.
Economic conditions may be affected by numerous factors, including but not limited to, the pace of economic growth and/or recessionary pressures, inflation, increases in unemployment levels, energy prices, tariffs and trade barriers, changes in currency exchange rates, uncertainty regarding government fiscal, monetary, and tax policy, geopolitical events, regulatory developments, changes in U.S. foreign policy and the availability and cost of credit and interest rates.
Facing mounting budget deficits, more state and local taxing authorities have indicated that they are going to revise their income tax regimes in this fashion and/or eliminate certain federally allowed tax deductions such as the REIT dividends paid deduction. Failure to make required distributions would subject us to U.S. federal corporate income tax.
Facing mounting budget deficits, more state and local taxing authorities have indicated that they are going to revise their income tax regimes in this fashion and/or eliminate certain federally allowed tax deductions such as the REIT dividends paid deduction.
We intend to operate in a manner that allows us to qualify as a REIT for U.S. federal income tax purposes.
Failure to make required distributions would subject us to U.S. federal corporate income tax. We intend to operate in a manner that allows us to qualify as a REIT for U.S. federal income tax purposes.
If the decline in real estate asset values and/or income occurs quickly, this may be especially difficult to accomplish. This difficulty may be exacerbated by the illiquid nature of any non-qualifying assets that we may own.
If the decline in real estate asset values and/or income occurs quickly, this may be especially difficult to accomplish. This difficulty may be exacerbated by the illiquid nature of any non-qualifying assets that we may own. We may have to make investment decisions that we otherwise would not make absent the REIT and Investment Company Act considerations.
We, as the general partner of our operating partnership, have fiduciary duties to the other limited partners in our operating partnership, the discharge of which may conflict with the interests of our stockholders.
Our fiduciary duties as the general partner of our operating partnership could create conflicts of interest, which may impede business decisions that could benefit our stockholders. We, as the general partner of our operating partnership, have fiduciary duties to the other limited partners in our operating partnership, the discharge of which may conflict with the interests of our stockholders.
Such changes may put us at a competitive disadvantage compared to some of our major competitors, to the extent we are unable to pass the tax costs through to our customers.
Such changes may put us at a competitive disadvantage compared to some of our major competitors, to the extent we are unable to pass the tax costs through to our customers. On July 4, 2025, the OBBBA was enacted in the U.S.
As a result, it is not possible at this time to predict with certainty the full effects of the Dodd-Frank Act, the CFTC’s rules and the SEC’s rules on us and the timing of such effects. 25 The Dodd-Frank Act and the rules adopted thereunder could significantly increase the cost of derivative contracts (including from swap recordkeeping and reporting requirements and through requirements to post margin with respect to our swaps, which could adversely affect our available liquidity), materially alter the terms of derivative contracts, reduce the availability of derivatives to protect against risks we encounter, reduce our ability to monetize or restructure our existing derivative contracts, and increase our exposure to less creditworthy counterparties.
The Dodd-Frank Act and the rules adopted thereunder could significantly increase the cost of derivative contracts (including from swap recordkeeping and reporting requirements and through requirements to post margin with respect to our swaps, which could adversely affect our available liquidity), materially alter the terms of derivative contracts, reduce the availability of derivatives to protect against risks we encounter, reduce our ability to monetize or restructure our existing derivative contracts, and increase our exposure to less creditworthy counterparties.
We do not expect to pay dividends on our common stock for the foreseeable future. We did not pay dividends on our common stock in fiscal year 2024. We do not expect to pay dividends on our common stock for the foreseeable future. We do not anticipate paying any dividends on our outstanding common stock for any quarter during 2025.
We do not expect to pay cash dividends on our common stock for the foreseeable future. We did not pay cash dividends on our common stock in fiscal year 2025. We do not expect to pay cash dividends on our common stock for the foreseeable future.
A TRS may hold assets and earn income that would not be qualifying assets or income if held or earned directly by a REIT, including gross operating income from hotels that are operated by eligible independent contractors pursuant to hotel management agreements. Both the subsidiary and the REIT must jointly elect to treat the subsidiary as a TRS.
A REIT may own up to 100% of the stock of one or more TRSs. A TRS may hold assets and earn income that would not be qualifying assets or income if held or earned directly by a REIT, including gross operating income from hotels that are operated by eligible independent contractors pursuant to hotel management agreements.
Because our advisor’s key employees have duties to Stirling Inc., Braemar and Ashford Inc., as well as to our company, we do not have their undivided attention and they face conflicts in allocating their time and resources between our company, Stirling Inc., Braemar and Ashford Inc. Our advisor may also manage other entities in the future.
Certain key employees of our advisor are executive officers of Braemar and Ashford Inc. Because our advisor’s key employees have duties to Braemar and Ashford Inc., as well as to our company, we do not have their undivided attention and they face conflicts in allocating their time and resources between our company Braemar and Ashford Inc.
In addition, the disruption of the existing travel plans of a significant number of travelers upon the occurrence of certain events, such as severe weather conditions, actual or threatened terrorist activity, war or travel-related health events, could result in significant additional costs and decrease our revenues, in each case, leading to constrained liquidity. 17 Some of our hotels are subject to ground leases; if we are found to be in breach of a ground lease or are unable to renew a ground lease, our business could be materially and adversely affected.
In addition, the disruption of the existing travel plans of a significant number of travelers upon the occurrence of certain events, such as severe weather conditions, actual or threatened terrorist activity, war or travel-related health events, could result in significant additional costs and decrease our revenues, in each case, leading to constrained liquidity.
These costs increase as the period covered by the hedging relationship increases and during periods of rising and volatile interest rates. These costs will also limit the amount of cash available for distributions to stockholders.
Hedging involves both risks and costs, including transaction costs, which may reduce our overall returns on our investments. These costs increase as the period covered by the hedging relationship increases and during periods of rising and volatile interest rates. These costs will also limit the amount of cash available for distributions to stockholders.
In addition, the use of social media could cause us to suffer brand damage or information leakage. Negative posts or comments about us, our hotel managers or our hotels on any social networking website could damage our or our hotels’ reputations. In addition, employees or others might disclose non-public sensitive information relating to our business through external media channels.
In addition, the use of social media or AI technologies could cause us to suffer brand damage or information leakage. Negative posts or comments about us, our hotel managers or our hotels on any social networking website could damage our or our hotels’ reputations.
We may have to make investment decisions that we otherwise would not make absent the REIT and Investment Company Act considerations. 35 RISKS RELATED TO OUR CORPORATE STRUCTURE Our charter, the partnership agreement of our operating partnership and Maryland law contain provisions that may delay or prevent a change of control transaction. Our charter contains 9.8% ownership limits.
RISKS RELATED TO OUR CORPORATE STRUCTURE Our charter, the partnership agreement of our operating partnership and Maryland law contain provisions that may delay or prevent a change of control transaction. Our charter contains 9.8% ownership limits.
As a result, even if revenues at our hotels decline significantly, we will still be required to make minimum monthly payments to Remington Hospitality equal to approximately $17,000 per hotel (increased annually based on consumer price index adjustments), which could adversely impact our liquidity and financial condition.
As a result, even if revenues at our hotels decline significantly, we will still be required to make minimum monthly payments to Remington Hospitality equal to approximately $18,000 per hotel (increased annually based on consumer price index adjustments), which could adversely impact our liquidity and financial condition. 12 Our joint venture investments could be adversely affected by our lack of sole decision-making authority, our reliance on a co-venturer’s financial condition and disputes between us and our co-venturers.
It may be difficult to refinance or extend the maturity of such loans on terms acceptable to us, or at all. These conditions could adversely affect our financial position, results of operations, and cash flows or the market price of our stock. 15 Higher interest rates have increased our debt payments and such debt payments may remain high.
These conditions could adversely affect our financial position, results of operations, and cash flows or the market price of our stock. Higher interest rates have increased our debt payments and such debt payments may remain high.
Some of our hotels are on land subject to ground leases, at least three of which cover the entire property. Accordingly, we only own a long-term leasehold rather than a fee simple interest, with respect to all or a portion of the real property at these hotels.
Accordingly, we only own a long-term leasehold rather than a fee simple interest, with respect to all or a portion of the real property at these hotels.
Our hotels have an ongoing need for renovations and other capital improvements, including replacements, from time to time, of furniture, fixtures and equipment (“FF&E”). Managers or franchisors of our hotels also will require periodic capital improvements pursuant to the management agreements or as a condition of maintaining franchise licenses. Generally, we are responsible for the cost of these capital improvements.
Managers or franchisors of our hotels also will require periodic capital improvements pursuant to the management agreements or as a condition of maintaining franchise licenses. Generally, we are responsible for the cost of these capital improvements.
As of December 31, 2024, Remington Hospitality managed 50 of our 69 hotel properties and three of the four Stirling OP hotel properties and provides other services. Mr. Monty J. Bennett is chairman and chief executive officer of Ashford Inc. and, together with his father Mr.
Archie Bennett, Jr., who is our chairman emeritus, is a significant stockholder of Ashford Inc. As of December 31, 2025, Remington Hospitality managed 50 of our 68 hotel properties and provides other services. Mr. Monty J. Bennett is chairman and chief executive officer of Ashford Inc. and, together with his father Mr.
We suffered significant impairment charges with respect to our investments in mortgage loans in 2009 and 2010. The value and the price of our securities may be adversely affected. We may invest in non-recourse loans, which will limit our recovery to the value of the mortgaged property. Our mortgage and mezzanine loan assets have typically been non-recourse.
We may invest in non-recourse loans, which will limit our recovery to the value of the mortgaged property. Our mortgage and mezzanine loan assets have typically been non-recourse.
As a result, we and our stockholders may have more limited rights against our directors and officers than might otherwise exist under common law. In addition, we are generally obligated to fund the defense costs incurred by our directors and officers.
As a result, we and our stockholders may have more limited rights against our directors and officers than might otherwise exist under common law.
Future issuances of common stock or preferred stock could decrease the relative voting power of our common stock or preferred stock and may cause substantial dilution in the ownership percentage of our then-existing holders of common or preferred stock.
Accordingly, we may issue up to an additional 388,523,509 shares of common stock and 40,104,240 shares of preferred stock. Future issuances of common stock or preferred stock could decrease the relative voting power of our common stock or preferred stock and may cause substantial dilution in the ownership percentage of our then-existing holders of common or preferred stock.
Finally, the 100% excise tax also applies to the underpricing of services by a TRS to its parent REIT in contexts where the services are unrelated to services for REIT tenants.
The rules also impose a 100% excise tax on certain transactions between a TRS and its parent REIT that are not conducted on an arm’s-length basis. Finally, the 100% excise tax also applies to the underpricing of services by a TRS to its parent REIT in contexts where the services are unrelated to services for REIT tenants.
These provisions include, among others: • redemption rights of qualifying parties; • transfer restrictions on our common units; • the ability of the general partner in some cases to amend the partnership agreement without the consent of the limited partners; and • the right of the limited partners to consent to transfers of the general partnership interest and mergers under specified circumstances.
These provisions include, among others: • redemption rights of qualifying parties; • transfer restrictions on our common units; • the ability of the general partner in some cases to amend the partnership agreement without the consent of the limited partners; and • the right of the limited partners to consent to transfers of the general partnership interest and mergers under specified circumstances. 38 Because provisions contained in Maryland law and our charter may have an anti-takeover effect, investors may be prevented from receiving a “control premium” for their shares.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThe Chief Technology Officer of Remington Hospitality reviews weekly reports that contain an overview of the activity in the department, any United States Computer Emergency Readiness Team alerts processed and all findings from the preventative maintenance tools. The Chief Technology Officer provides such report to the Chief Financial Officer on a quarterly basis.
Biggest changeThe Executive Vice President of Technology of Remington Hospitality reviews weekly reports that contain an overview of the activity in the department, any United States Computer Emergency Readiness Team alerts processed and all findings from the preventative maintenance tools. The Executive Vice President of Technology provides such report to the Executive Vice President of Asset Management on a quarterly basis.
The Audit Committee of the board of directors is then briefed each quarter on the occurrence of any cybersecurity incidents.
The Audit Committee of the board of directors is then briefed each quarter on the occurrence of any cybersecurity incidents. 43
A Cyber Incident Response Team comprised of Ashford Inc. and Remington Hospitality employees meets bi-weekly to review incidents that have occurred and/or impacted the Company’s electronic assets.
A Cyber Incident Response Team comprised of Ashford Inc. and Remington Hospitality employees meets monthly to review incidents that have occurred and/or impacted the Company’s electronic assets.
Management, provided by Ashford Inc., is ultimately responsible for assessing and managing the Company’s cybersecurity risk. The information security program is overseen by the Chief Financial Officer of Ashford Inc. and the Chief Technology Officer for Remington Hospitality.
Management, provided by Ashford Inc., is ultimately responsible for assessing and managing the Company’s cybersecurity risk. The information security program is overseen by the Executive Vice President of Asset Management for Ashford Inc. and the Executive Vice President of Technology for Remington Hospitality.
Removed
The board of directors will also be provided an overview of the information security program on an annual basis, including updates on Remington Hospitality’s IT team, IT training, implementation, IT controls, cybersecurity testing, the incident response process and the cybersecurity assets of the Company. 40

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeWorth, TX Full-service 294 100 294 65.30 % $ 187.25 $ 122.19 Hampton Inn (7) Buford, GA Select-service 92 100 92 79.26 % $ 144.44 $ 114.48 Hampton Inn Evansville, IN Select-service 140 100 140 59.50 % $ 126.55 $ 75.24 Hampton Inn Parsippany, NJ Select-service 152 100 152 66.40 % $ 137.29 $ 91.09 Marriott Beverly Hills, CA Full-service 260 100 260 91.90 % $ 261.45 $ 240.33 Marriott Arlington, VA Full-service 703 100 703 75.00 % $ 222.67 $ 166.93 Marriott Dallas, TX Full-service 265 100 265 65.20 % $ 158.83 $ 103.58 Marriott Fremont, CA Full-service 357 100 357 68.30 % $ 162.73 $ 111.22 Marriott Memphis, TN Full-service 232 100 232 71.20 % $ 161.68 $ 115.12 Marriott Irving, TX Full-service 499 100 499 72.60 % $ 173.98 $ 126.37 Marriott Omaha, NE Full-service 300 100 300 60.10 % $ 140.25 $ 84.26 Marriott Sugarland, TX Full-service 303 100 303 72.20 % $ 161.79 $ 116.78 SpringHill Suites by Marriott (7) Buford, GA Select-service 97 100 97 76.34 % $ 137.23 $ 104.77 Courtyard by Marriott Bloomington, IN Select-service 117 100 117 60.20 % $ 163.00 $ 98.09 Courtyard by Marriott - Tremont Boston, MA Select-service 315 100 315 77.80 % $ 286.76 $ 223.10 Courtyard by Marriott Denver, CO Select-service 202 100 202 86.00 % $ 150.61 $ 129.59 Courtyard by Marriott Gaithersburg, MD Select-service 210 100 210 67.30 % $ 174.59 $ 117.56 Courtyard by Marriott Crystal City, VA Select-service 272 100 272 80.50 % $ 178.68 $ 143.84 Courtyard by Marriott Overland Park, KS Select-service 168 100 168 55.50 % $ 136.37 $ 75.68 Courtyard by Marriott Foothill Ranch, CA Select-service 156 100 156 75.30 % $ 146.28 $ 110.19 Courtyard by Marriott Alpharetta, GA Select-service 154 100 154 58.90 % $ 115.91 $ 68.22 Marriott Residence Inn Evansville, IN Select-service 78 100 78 67.90 % $ 110.17 $ 74.78 Marriott Residence Inn Orlando, FL Select-service 350 100 350 74.20 % $ 147.08 $ 109.15 41 Hotel Property Location Service Type Total Rooms % Owned Owned Rooms Year Ended December 31, 2024 Occupancy ADR RevPAR Marriott Residence Inn Falls Church, VA Select-service 159 100 159 79.90 % $ 175.30 $ 140.11 Marriott Residence Inn San Diego, CA Select-service 150 100 150 85.50 % $ 192.47 $ 164.47 Marriott Residence Inn (7) Jacksonville, FL Select-service 120 100 120 74.62 % $ 137.09 $ 102.29 Marriott Residence Inn (7) Manchester, CT Select-service 96 100 96 73.79 % $ 155.88 $ 115.03 Sheraton Hotel Minneapolis, MN Full-service 220 100 220 45.70 % $ 144.30 $ 66.02 Sheraton Hotel Indianapolis, IN Full-service 378 100 378 58.60 % $ 186.02 $ 109.07 Sheraton Hotel Anchorage, AK Full-service 370 100 370 73.40 % $ 203.23 $ 149.22 Sheraton Hotel San Diego, CA Full-service 260 100 260 90.40 % $ 166.37 $ 150.34 Hyatt Regency Coral Gables, FL Full-service 254 100 254 76.50 % $ 243.09 $ 185.86 Hyatt Regency Hauppauge, NY Full-service 358 100 358 58.10 % $ 167.18 $ 97.10 Hyatt Regency Savannah, GA Full-service 351 100 351 89.30 % $ 221.68 $ 197.89 Renaissance Nashville, TN Full-service 674 100 674 78.20 % $ 286.17 $ 223.78 Annapolis Historic Inn Annapolis, MD Full-service 124 100 124 62.10 % $ 195.64 $ 121.41 Lakeway Resort & Spa Austin, TX Full-service 168 100 168 50.40 % $ 220.03 $ 110.88 Silversmith Chicago, IL Full-service 144 100 144 66.00 % $ 204.19 $ 134.85 The Churchill Washington, D.C.
Biggest changeWorth, TX Full-service 294 100 % 294 66.20 % $ 177.36 $ 117.41 Hampton Inn Buford, GA Select-service 92 100 % 92 75.69 % $ 135.48 $ 102.55 Hampton Inn Evansville, IN Select-service 140 100 % 140 63.60 % $ 121.37 $ 77.22 Hampton Inn Parsippany, NJ Select-service 152 100 % 152 68.40 % $ 134.16 $ 91.79 Marriott Beverly Hills, CA Full-service 260 100 % 260 88.60 % $ 259.97 $ 230.29 Marriott Arlington, VA Full-service 703 100 % 703 75.70 % $ 226.06 $ 171.17 Marriott Dallas, TX Full-service 265 100 % 265 62.70 % $ 164.32 $ 102.97 Marriott Fremont, CA Full-service 357 100 % 357 70.00 % $ 167.69 $ 117.34 Marriott Memphis, TN Full-service 232 100 % 232 72.10 % $ 155.96 $ 112.43 Marriott Irving, TX Full-service 499 100 % 499 73.20 % $ 178.45 $ 130.57 Marriott Omaha, NE Full-service 300 100 % 300 57.80 % $ 136.51 $ 78.88 Marriott Sugarland, TX Full-service 303 100 % 303 79.90 % $ 169.47 $ 135.37 SpringHill Suites by Marriott Buford, GA Select-service 97 100 % 97 79.20 % $ 132.73 $ 105.12 Courtyard by Marriott Bloomington, IN Select-service 117 100 % 117 54.10 % $ 166.87 $ 90.23 Courtyard by Marriott Denver, CO Select-service 202 100 % 202 84.40 % $ 151.21 $ 127.55 Courtyard by Marriott Gaithersburg, MD Select-service 210 100 % 210 63.70 % $ 169.44 $ 107.97 Courtyard by Marriott Crystal City, VA Select-service 272 100 % 272 76.20 % $ 171.03 $ 130.29 Courtyard by Marriott Overland Park, KS Select-service 168 100 % 168 65.20 % $ 128.88 $ 84.01 Courtyard by Marriott Foothill Ranch, CA Select-service 156 100 % 156 75.60 % $ 145.88 $ 110.36 Courtyard by Marriott Alpharetta, GA Select-service 154 100 % 154 59.50 % $ 117.88 $ 70.18 Marriott Residence Inn Orlando, FL Select-service 350 100 % 350 70.10 % $ 145.62 $ 102.06 Marriott Residence Inn Falls Church, VA Select-service 159 100 % 159 74.00 % $ 159.86 $ 118.30 Marriott Residence Inn Jacksonville, FL Select-service 120 100 % 120 74.61 % $ 135.44 $ 101.06 Marriott Residence Inn Manchester, CT Select-service 96 100 % 96 82.60 % $ 164.95 $ 136.25 44 Year Ended December 31, 2025 Hotel Property Location Service Type Total Rooms % Owned Owned Rooms Occupancy ADR RevPAR Sheraton Hotel Minneapolis, MN Full-service 220 100 % 220 48.70 % $ 137.63 $ 67.09 Sheraton Hotel Indianapolis, IN Full-service 378 100 % 378 56.80 % $ 176.64 $ 100.30 Sheraton Hotel Anchorage, AK Full-service 370 100 % 370 73.10 % $ 231.84 $ 169.40 Sheraton Hotel San Diego, CA Full-service 260 100 % 260 88.30 % $ 156.37 $ 138.00 Hyatt Regency Coral Gables, FL Full-service 254 100 % 254 78.50 % $ 244.37 $ 191.76 Hyatt Regency Hauppauge, NY Full-service 358 100 % 358 64.30 % $ 170.39 $ 109.56 Hyatt Regency Savannah, GA Full-service 351 100 % 351 88.10 % $ 210.68 $ 185.56 Renaissance Nashville, TN Full-service 674 100 % 674 78.30 % $ 286.35 $ 224.10 Annapolis Historic Inn Annapolis, MD Full-service 124 100 % 124 59.40 % $ 191.70 $ 113.78 Lakeway Resort & Spa Austin, TX Full-service 168 100 % 168 49.10 % $ 211.43 $ 103.89 Silversmith Chicago, IL Full-service 144 100 % 144 67.20 % $ 185.09 $ 124.36 The Churchill Washington, DC Full-service 173 100 % 173 60.60 % $ 190.59 $ 115.45 The Melrose Washington, DC Full-service 240 100 % 240 66.70 % $ 193.01 $ 128.71 Westin Princeton, NJ Full-service 296 100 % 296 66.50 % $ 178.32 $ 118.49 Hotel Indigo Atlanta, GA Full-service 141 100 % 141 65.10 % $ 141.04 $ 91.84 Ritz-Carlton Atlanta, GA Full-service 444 100 % 444 64.00 % $ 308.42 $ 197.44 La Posada de Santa Fe Santa Fe, NM Full-service 157 100 % 157 75.40 % $ 278.44 $ 209.94 Leasehold Properties Autograph La Concha (1) Key West, FL Full-service 160 100 % 160 74.90 % $ 376.00 $ 281.75 Renaissance (2) Palm Springs, CA Full-service 410 100 % 410 68.60 % $ 204.17 $ 140.05 Hilton (3) Marietta, GA Full-service 200 100 % 200 64.90 % $ 176.81 $ 114.73 Le Méridien (4) Fort Worth, TX Full-service 188 29 % 55 67.20 % $ 192.97 $ 129.67 Total 16,633 16,500 70.39 % $ 187.93 $ 132.28 ________ (1) The ground lease expires in 2084.
Item 2. Properties OFFICES. We lease our headquarters located at 14185 Dallas Parkway, Suite 1200, Dallas, Texas 75254. HOTEL PROPERTIES. As of December 31, 2024, our portfolio consisted of 68 operating hotel properties, one consolidated operating hotel property through a 29.3% owned investment in a consolidated entity and four Stirling OP hotel properties that were included in our consolidated operations.
Item 2. Properties OFFICES. We lease our headquarters located at 14185 Dallas Parkway, Suite 1200, Dallas, Texas 75254. HOTEL PROPERTIES. As of December 31, 2025, our portfolio consisted of 67 operating hotel properties and one consolidated operating hotel property through a 29.3% owned investment in a consolidated entity. Currently, all of our hotel properties are located in the United States.
The following table presents certain information related to our hotel properties: Hotel Property Location Service Type Total Rooms % Owned Owned Rooms Year Ended December 31, 2024 Occupancy ADR RevPAR Fee Simple Properties Embassy Suites Austin, TX Full-service 150 100 150 67.40 % $ 158.64 $ 106.95 Embassy Suites Dallas, TX Full-service 150 100 150 59.00 % $ 139.55 $ 82.27 Embassy Suites Herndon, VA Full-service 150 100 150 79.60 % $ 165.35 $ 131.58 Embassy Suites Las Vegas, NV Full-service 220 100 220 86.80 % $ 176.29 $ 152.94 Embassy Suites Houston, TX Full-service 150 100 150 71.60 % $ 150.53 $ 107.74 Embassy Suites West Palm Beach, FL Full-service 160 100 160 73.30 % $ 192.42 $ 141.06 Embassy Suites Philadelphia, PA Full-service 263 100 263 68.30 % $ 168.79 $ 115.28 Embassy Suites Arlington, VA Full-service 269 100 269 79.50 % $ 225.50 $ 179.32 Embassy Suites Portland, OR Full-service 276 100 276 59.30 % $ 166.51 $ 98.66 Embassy Suites Santa Clara, CA Full-service 258 100 258 65.10 % $ 243.82 $ 158.63 Embassy Suites Orlando, FL Full-service 174 100 174 88.90 % $ 167.14 $ 148.55 Hilton Garden Inn Jacksonville, FL Select-service 119 100 119 64.80 % $ 136.15 $ 88.25 Hilton Garden Inn Austin, TX Select-service 254 100 254 58.60 % $ 207.13 $ 121.32 Hilton Garden Inn Baltimore, MD Select-service 158 100 158 74.70 % $ 127.25 $ 95.08 Hilton Garden Inn Virginia Beach, VA Select-service 176 100 176 71.40 % $ 162.46 $ 116.05 Hilton Houston, TX Full-service 242 100 242 68.60 % $ 138.08 $ 94.74 Hilton St.
The following table presents certain information related to our hotel properties: Year Ended December 31, 2025 Hotel Property Location Service Type Total Rooms % Owned Owned Rooms Occupancy ADR RevPAR Fee Simple Properties Embassy Suites Austin, TX Full-service 150 100 % 150 72.00 % $ 142.01 $ 102.29 Embassy Suites Dallas, TX Full-service 150 100 % 150 72.00 % $ 141.86 $ 102.15 Embassy Suites Herndon, VA Full-service 150 100 % 150 72.60 % $ 169.49 $ 123.03 Embassy Suites Las Vegas, NV Full-service 220 100 % 220 82.20 % $ 167.75 $ 137.92 Embassy Suites Houston, TX Full-service 150 100 % 150 65.10 % $ 138.82 $ 90.37 Embassy Suites West Palm Beach, FL Full-service 160 100 % 160 76.90 % $ 192.23 $ 147.77 Embassy Suites Philadelphia, PA Full-service 263 100 % 263 78.40 % $ 155.49 $ 121.96 Embassy Suites Arlington, VA Full-service 269 100 % 269 72.90 % $ 227.00 $ 165.49 Embassy Suites Portland, OR Full-service 276 100 % 276 57.60 % $ 151.96 $ 87.51 Embassy Suites Santa Clara, CA Full-service 258 100 % 258 66.20 % $ 251.51 $ 166.58 Embassy Suites Orlando, FL Full-service 174 100 % 174 85.50 % $ 163.31 $ 139.63 Hilton Garden Inn Jacksonville, FL Select-service 119 100 % 119 60.30 % $ 131.65 $ 79.40 Hilton Garden Inn Austin, TX Select-service 254 100 % 254 52.80 % $ 175.88 $ 92.82 Hilton Garden Inn Baltimore, MD Select-service 158 100 % 158 79.20 % $ 123.36 $ 97.71 Hilton Garden Inn Virginia Beach, VA Select-service 176 100 % 176 62.40 % $ 160.30 $ 100.07 Hilton St.
(5) The lease expires in 2054 and includes the lease of the land, hotel and conference center (including the building, improvements, furniture, fixtures and equipment). (6) The lease expires in 2120 and includes the lease of the land and building. (7) Hotel property owned by Stirling OP, but consolidated by the Company. 42
(2) The ground lease expires in 2059. (3) The lease expires in 2054 and includes the lease of the land, hotel and conference center (including the building, improvements, furniture, fixtures and equipment). (4) The lease expires in 2120 and includes the lease of the land and building. 45
Petersburg, FL Full-service 333 100 333 72.30 % $ 200.57 $ 145.10 Hilton Santa Fe, NM Full-service 158 100 158 80.30 % $ 225.15 $ 180.82 Hilton Bloomington, MN Full-service 300 100 300 58.60 % $ 129.87 $ 76.16 Hilton Costa Mesa, CA Full-service 486 100 486 76.10 % $ 155.17 $ 118.08 Hilton Parsippany, NJ Full-service 353 100 353 42.00 % $ 169.72 $ 71.23 Hilton Tampa, FL Full-service 238 100 238 78.50 % $ 181.48 $ 142.49 Hilton Alexandria, VA Full-service 252 100 252 66.20 % $ 217.08 $ 143.61 Hilton Santa Cruz, CA Full-service 178 100 178 74.60 % $ 172.86 $ 128.98 Hilton Ft.
Petersburg, FL Full-service 333 100 % 333 73.60 % $ 180.86 $ 133.13 Hilton Santa Fe, NM Full-service 158 100 % 158 82.40 % $ 214.23 $ 176.55 Hilton Bloomington, MN Full-service 300 100 % 300 63.50 % $ 121.91 $ 77.36 Hilton Costa Mesa, CA Full-service 486 100 % 486 79.40 % $ 156.70 $ 124.46 Hilton Parsippany, NJ Full-service 353 100 % 353 46.10 % $ 166.21 $ 76.60 Hilton Tampa, FL Full-service 238 100 % 238 87.90 % $ 169.67 $ 149.16 Hilton Alexandria, VA Full-service 252 100 % 252 64.60 % $ 207.82 $ 134.35 Hilton Santa Cruz, CA Full-service 178 100 % 178 74.40 % $ 169.50 $ 126.18 Hilton Ft.
Removed
Currently, all of our hotel properties are located in the United States.
Removed
Full-service 173 100 173 62.60 % $ 205.17 $ 128.51 The Melrose Washington, D.C.
Removed
Full-service 240 100 240 68.00 % $ 206.30 $ 140.31 Le Pavillon (1) New Orleans, LA Full-service 226 100 226 49.90 % $ 168.41 $ 84.08 Westin Princeton, NJ Full-service 296 100 296 69.50 % $ 186.28 $ 129.40 Hotel Indigo Atlanta, GA Full-service 141 100 141 54.40 % $ 157.87 $ 85.95 Ritz-Carlton Atlanta, GA Full-service 444 100 444 63.80 % $ 298.87 $ 190.82 La Posada de Santa Fe Santa Fe, NM Full-service 157 100 157 76.40 % $ 286.90 $ 219.14 Leasehold Properties Autograph La Concha (2) (3) Key West, FL Full-service 160 100 160 63.70 % $ 347.15 $ 221.17 Renaissance (4) Palm Springs, CA Full-service 410 100 410 68.00 % $ 200.23 $ 136.13 Hilton (5) Marietta, GA Full-service 200 100 200 64.20 % $ 173.58 $ 111.46 Le Meridien (6) Fort Worth, TX Full-service 188 29 55 46.10 % $ 206.18 $ 95.07 Total 17,644 17,511 69.60 % $ 190.76 $ 132.85 ________ (1) The Company entered into a new franchise agreement with Marriott to convert the Le Pavillon in New Orleans, Louisiana to a Tribute Portfolio property.
Removed
The conversion was completed in November 2024. (2) The ground lease expires in 2084. (3) The Company entered into a franchise agreement with Marriott to convert the La Concha Key West Hotel in Key West, Florida to an Autograph Collection property. The conversion was completed in December 2024. (4) The ground lease expires in 2083.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

5 edited+4 added−8 removed7 unchanged
Biggest changeBeverly Hills Marriott, was filed in Alameda County Superior Court as a PAGA representative action alleging various wage and hour violations of all Remington managed California properties. The plaintiff’s individual claims were compelled to arbitration. On August 18, 2022, another lawsuit, Cristina Catalano v. Beverly Hills Marriott and Mr.
Biggest changeAs of December 31, 2025, the settlement liability amount was accrued. On August 4, 2020, a lawsuit, Benjamin Zermeno v. Beverly Hills Marriott, was filed in Alameda County Superior Court as a PAGA representative action alleging various wage and hour violations of all Remington managed California properties. The plaintiff’s individual claims were compelled to arbitration.
If we ultimately do not prevail in one or more of these legal matters, and the associated realized losses exceed our current estimates of the range of potential losses, our consolidated financial position, results of operations, or cash flows could be materially adversely affected in future periods. 43 Item 4. Mine Safety Disclosures None. PART II
If we ultimately do not prevail in one or more of these legal matters, and the associated realized losses exceed our current estimates of the range of potential losses, our consolidated financial position, results of operations or cash flows could be materially adversely affected in future periods. Item 4. Mine Safety Disclosures None. PART II
On December 20, 2016, a class action lawsuit was filed against one of the Company’s hotel management companies in the Superior Court of the State of California in and for the County of Contra Costa alleging violations of certain California employment laws, which class action affects nine hotels owned by subsidiaries of the Company.
Item 3. Legal Proceedings On December 20, 2016, a class action lawsuit was filed against one of the Company’s hotel management companies in the Superior Court of the State of California in and for the County of Contra Costa alleging violations of certain California employment laws, which class action affects nine hotels owned by subsidiaries of the Company.
C, was filed as a PAGA representative action alleging various wage and hour violations of all Remington managed California properties. The co-defendant separately settled and the individual arbitration has also settled. A private mediation was held on December 27, 2024 to globally resolve the three outstanding matters.
On August 18, 2022, another lawsuit, Cristina Catalano v. Beverly Hills Marriott and Mr. C, was filed as a PAGA representative action alleging various wage and hour violations of all Remington managed California properties. The co-defendant separately settled and the individual arbitration has also settled.
A tentative settlement was reached subject to the parties finalizing the agreement and court approval. As of December 31, 2024, the estimated settlement liability amount has been accrued. We are also engaged in other legal proceedings that have arisen but have not been fully adjudicated.
We are also engaged in other legal proceedings that have arisen but have not been fully adjudicated.
Removed
Item 3. Legal Proceedings Palm Beach Florida Hotel and Office Building Limited Partnership, et al. v. Nantucket Enterprises, Inc. This litigation involves a landlord tenant dispute from 2008. This litigation was resolved in 2017 with the determination and reimbursement of attorney’s fees being the only remaining dispute.
Added
On February 13, 2024, the judge ordered the parties to submit additional briefing related to on-site breaks. A tentative settlement in the amount of $850,000 was reached on February 14, 2025. Final court approval was obtained on September 12, 2025. Ashford Trust’s portion of the settlement is 88.2%. The case is now in the settlement administration phase.
Removed
The negotiations relating to the potential payment of the remaining attorneys’ fees remained open, pending the appeal of a contempt order against the Maraist Law Firm for failing to produce their fee records. We previously accrued approximately $504,000 in legal fees.
Added
A private mediation was held on December 27, 2024 to globally resolve the three outstanding matters. The court approved the settlement of all matters on January 16, 2026. The aggregate settlement is $2.5 million and Ashford Trust’s portion of the settlement is $1.8 million. As of December 31, 2025, the settlement liability amount was accrued.
Removed
In September 2024, a settlement was reached to resolve the prevailing party’s legal fees in the amount of $1.4 million. As a result an additional accrual of approximately $896,000 was recorded and is included in “other hotel expenses” on our consolidated statement of operations for the year ended December 31, 2024.
Added
On April 18, 2024, the California Department of Industrial Relations (“DIR”) served the Company’s manager with an investigative subpoena relative to concerns with the Palm Springs Renaissance Hotel’s COVID recall efforts. On August 27, 2025, the DIR issued a citation that the Company’s manager failed to properly recall certain employees.
Removed
On February 13, 2024, the judge ordered the parties to submit additional briefing related to on-site breaks. A tentative settlement has been reached subject to the respective parties obtaining various approvals. On August 4, 2020, a lawsuit, Benjamin Zermeno v.
Added
On September 17, 2025, the Company’s manager filed an appeal which is currently pending. The matter is in the early stages and the ultimate outcome of this matter is unknown at this time. We do not believe that any potential loss to the Company is reasonably estimable at this time. As of December 31, 2025, no amounts were accrued.
Removed
During the quarter ended September 30, 2023, we had a cyber incident that resulted in the potential exposure of certain personal information. We have completed an investigation and have identified certain information that may have been exposed and notified potentially impacted individuals pursuant to applicable state guidelines. All systems have been restored.
Removed
In February of 2024, two class action lawsuits were filed, one in the U.S. District Court for the Northern District of Texas and a second in the 68th District Court for Dallas County related to the cyber incident. The lawsuit filed in the 68th District Court was subsequently dismissed and refiled in the U.S.
Removed
District Court for the Northern District of Texas. On March 12, 2024, the court ordered the two cases be consolidated. The consolidated case is currently pending in the U.S. District Court for the Northern District of Texas. The parties have reached an agreement, subject to final Court approval, to resolve the class action suit.
Removed
The amount of the class settlement is approximately $485,000. Ashford Inc. expects the entire settlement amount to be reimbursed through insurance coverage. The hearing for final Court approval of the settlement is scheduled for August 27, 2025.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

10 edited+5 added−5 removed5 unchanged
Biggest changeDistributions paid per share were characterized as follows for the following fiscal years: 2024 2023 2022 Amount % Amount % Amount % Preferred Stock – Series D: Ordinary taxable dividend $ — — % $ — — % $ — — % Capital gain distribution 0.9383 44.4202 % — — % — — % Return of capital 1.1741 55.5798 % 2.1125 100.0000 % 2.1125 100.0000 % Total $ 2.1124 (1) 100.0000 % $ 2.1125 (1) 100.0000 % $ 2.1125 (1) 100.0000 % Preferred Stock – Series F: Ordinary taxable dividend $ — — % $ — — % $ — — % Capital gain distribution 0.8189 44.4202 % — — % — — % Return of capital 1.0247 55.5798 % 1.8438 100.0000 % 1.8438 100.0000 % Total $ 1.8436 (1) 100.0000 % $ 1.8438 (1) 100.0000 % $ 1.8438 (1) 100.0000 % Preferred Stock – Series G: Ordinary taxable dividend $ — — % $ — — % $ — — % Capital gain distribution 0.8189 44.4202 % — — % — — % Return of capital 1.0247 55.5798 % 1.8438 100.0000 % 1.8438 100.0000 % Total $ 1.8436 (1) 100.0000 % $ 1.8438 (1) 100.0000 % $ 1.8438 (1) 100.0000 % Preferred Stock – Series H: Ordinary taxable dividend $ — — % $ — — % $ — — % Capital gain distribution 0.8329 44.4202 % — — % — — % Return of capital 1.0421 55.5798 % 1.8750 100.0000 % 1.8750 100.0000 % Total $ 1.8750 (1) 100.0000 % $ 1.8750 (1) 100.0000 % $ 1.8750 (1) 100.0000 % Preferred Stock – Series I: Ordinary taxable dividend $ — — % $ — — % $ — — % Capital gain distribution 0.8329 44.4202 % — — % — — % Return of capital 1.0421 55.5798 % 1.8750 100.0000 % 1.8750 100.0000 % Total $ 1.8750 (1) 100.0000 % $ 1.8750 (1) 100.0000 % $ 1.8750 (1) 100.0000 % Preferred Stock – Series J: Ordinary taxable dividend $ — — % $ — — % $ — — % 44 Capital gain distribution 0.8884 44.4202 % — — % — — % Return of capital 1.1116 55.5798 % 1.9998 100.0000 % 0.1666 100.0000 % Total $ 2.0000 (1) (11) 100.0000 % $ 1.9998 (1) (12) 100.0000 % $ 0.1666 (1) (13) 100.0000 % Preferred Stock – Series K (2) : Ordinary taxable dividend $ — — % $ — — % $ — — % Capital gain distribution 0.9236 44.4202 % — — % — — % Return of capital 1.1556 55.5798 % 2.0540 100.0000 % — — % Total $ 2.0792 (1) (11) 100.0000 % $ 2.0540 (1) (12) 100.0000 % $ — — % Preferred Stock – Series K (3) : Ordinary taxable dividend $ — — % $ — — % $ — — % Capital gain distribution 0.9208 44.4202 % — — % — — % Return of capital 1.1521 55.5798 % 1.8790 100.0000 % — — % Total $ 2.0729 (1) (11) 100.0000 % $ 1.8790 (1) (12) 100.0000 % $ — — % Preferred Stock – Series K (4) : Ordinary taxable dividend $ — — % $ — — % $ — — % Capital gain distribution 0.9180 44.4202 % — — % — — % Return of capital 1.1487 55.5798 % 1.8790 100.0000 % — — % Total $ 2.0667 (1) (11) 100.0000 % $ 1.8790 (1) (12) 100.0000 % $ — — % Preferred Stock – Series K (5) : Ordinary taxable dividend $ — — % $ — — % $ — — % Capital gain distribution 0.9152 44.4202 % — — % — — % Return of capital 1.1452 55.5798 % 1.8790 100.0000 % — — % Total $ 2.0604 (1) (11) 100.0000 % $ 1.8790 (1) (12) 100.0000 % $ — — % Preferred Stock – Series K (6) : Ordinary taxable dividend $ — — % $ — — % $ — — % Capital gain distribution 0.9125 44.4202 % — — % — — % Return of capital 1.1417 55.5798 % 1.8790 100.0000 % — — % Total $ 2.0542 (1) (11) 100.0000 % $ 1.8790 (1) (12) 100.0000 % $ — — % Preferred Stock – Series K (7) : Ordinary taxable dividend $ — $ — — % $ — — % Capital gain distribution 0.8347 44.4202 % — — % — — % Return of capital 1.0444 55.5798 % — — % — — % Total $ 1.8791 (1) (11) 100.0000 % $ — — % $ — — % Preferred Stock – Series K (8) : Ordinary taxable dividend $ — — % $ — — % $ — — % Capital gain distribution 0.6071 44.4202 % — — % — — % Return of capital 0.7596 55.5798 % — — % — — % Total $ 1.3667 (1) (11) 100.0000 % $ — — % $ — — % Preferred Stock – Series K (9) : Ordinary taxable dividend $ — — % $ — — % $ — — % Capital gain distribution 0.3794 44.4202 % — — % — — % Return of capital 0.4747 55.5798 % — — % — — % Total $ 0.8541 (1) (11) 100.0000 % $ — — % $ — — % Preferred Stock – Series K (10) : Ordinary taxable dividend $ — — % $ — — % $ — — % Capital gain distribution 0.1518 44.4202 % — — % — — % Return of capital 0.1899 55.5798 % — — % — — % Total $ 0.3417 (1) (11) 100.0000 % $ — — % $ — — % ____________________ (1) The fourth quarter 2022 preferred distributions paid January 17, 2023 to stockholders of record as of December 30, 2022 are treated as 2023 distributions for tax purposes.
Biggest changeDistributions paid per share were characterized as follows for the following fiscal years: 2025 2024 2023 Amount Amount Amount Preferred Stock – Series D: Ordinary taxable dividend $ — $ — $ — Capital gain distribution — 0.9383 — Return of capital 2.1124 1.1741 2.1125 Total $ 2.1124 (1) $ 2.1124 (1) $ 2.1125 (1) Preferred Stock – Series F: Ordinary taxable dividend $ — $ — $ — Capital gain distribution — 0.8189 — Return of capital 1.8436 1.0247 1.8438 Total $ 1.8436 (1) $ 1.8436 (1) $ 1.8438 (1) Preferred Stock – Series G: Ordinary taxable dividend $ — $ — $ — Capital gain distribution — 0.8189 — Return of capital 1.8436 1.0247 1.8438 Total $ 1.8436 (1) $ 1.8436 (1) $ 1.8438 (1) Preferred Stock – Series H: Ordinary taxable dividend $ — $ — $ — Capital gain distribution — 0.8329 — Return of capital 1.8750 1.0421 1.8750 Total $ 1.8750 (1) $ 1.8750 (1) $ 1.8750 (1) Preferred Stock – Series I: Ordinary taxable dividend $ — $ — $ — Capital gain distribution — 0.8329 — Return of capital 1.8750 1.0421 1.8750 Total $ 1.8750 (1) $ 1.8750 (1) $ 1.8750 (1) Preferred Stock – Series J (2) : Ordinary taxable dividend $ — $ — $ — 47 2025 2024 2023 Amount Amount Amount Capital gain distribution — 0.8884 — Return of capital 2.0000 1.1116 1.9998 Total $ 2.0000 (1) (20) $ 2.0000 (1) (22) $ 1.9998 (1) (21) Preferred Stock – Series J (3) : Ordinary taxable dividend $ — $ — $ — Capital gain distribution — — — Return of capital 1.8334 — — Total $ 1.8334 (1) (20) $ — $ — Preferred Stock – Series K (4) : Ordinary taxable dividend $ — $ — $ — Capital gain distribution — 0.9236 — Return of capital 2.1042 1.1556 2.054 Total $ 2.1042 (1) (20) $ 2.0792 (1) (22) $ 2.0540 (1) (21) Preferred Stock – Series K (5) : Ordinary taxable dividend $ — $ — $ — Capital gain distribution — 0.9208 — Return of capital 2.0979 1.1521 1.879 Total $ 2.0979 (1) (20) $ 2.0729 (1) (22) $ 1.8790 (1) (21) Preferred Stock – Series K (6) : Ordinary taxable dividend $ — $ — $ — Capital gain distribution — 0.9180 — Return of capital 2.0917 1.1487 1.879 Total $ 2.0917 (1) (20) $ 2.0667 (1) (22) $ 1.8790 (1) (21) Preferred Stock – Series K (7) : Ordinary taxable dividend $ — $ — $ — Capital gain distribution — 0.9152 — Return of capital 2.0854 1.1452 1.8790 Total $ 2.0854 (1) (20) $ 2.0604 (1) (22) $ 1.8790 (1) (21) Preferred Stock – Series K (8) : Ordinary taxable dividend $ — $ — $ — Capital gain distribution — 0.9125 — Return of capital 2.0792 1.1417 1.879 Total $ 2.0792 (1) (20) $ 2.0542 (1) (22) $ 1.8790 (1) (21) Preferred Stock – Series K (9) : Ordinary taxable dividend $ — $ — $ — Capital gain distribution — 0.8347 — Return of capital 2.0730 1.0444 — Total $ 2.0730 (1) (20) $ 1.8791 (1) (22) $ — Preferred Stock – Series K (10) : Ordinary taxable dividend $ — $ — $ — Capital gain distribution — 0.6071 — Return of capital 2.0667 0.7596 — Total $ 2.0667 (1) (20) $ 1.3667 (1) (22) $ — Preferred Stock – Series K (11) : Ordinary taxable dividend $ — $ — $ — Capital gain distribution — 0.3794 — Return of capital 2.0604 0.4747 — Total $ 2.0604 (1) (20) $ 0.8541 (1) (22) $ — Preferred Stock – Series K (12) : Ordinary taxable dividend $ — $ — $ — Capital gain distribution — 0.1518 — Return of capital 2.0541 0.1899 — Total $ 2.0541 (1) (20) $ 0.3417 (1) (22) $ — Preferred Stock – Series K (13) : Ordinary taxable dividend $ — $ — $ — Capital gain distribution — — — 48 2025 2024 2023 Amount Amount Amount Return of capital 1.8791 — — Total $ 1.8791 (1) (20) $ — $ — Preferred Stock – Series L (14) : Ordinary taxable dividend $ — $ — $ — Capital gain distribution — — — Return of capital 1.2500 — — Total $ 1.2500 (1) (20) $ — $ — Preferred Stock – Series L (15) : Ordinary taxable dividend $ — $ — $ — Capital gain distribution — — — Return of capital 0.7813 — — Total $ 0.7813 (1) (20) $ — $ — Preferred Stock – Series L (16) : Ordinary taxable dividend $ — $ — $ — Capital gain distribution — — — Return of capital 0.3125 — — Total $ 0.3125 (1) (20) $ — $ — Preferred Stock – Series M (17) : Ordinary taxable dividend $ — $ — $ — Capital gain distribution — — — Return of capital 1.2834 — — Total $ 1.2834 (1) (20) $ — $ — Preferred Stock – Series M (18) : Ordinary taxable dividend $ — $ — $ — Capital gain distribution — — — Return of capital 0.8021 — — Total $ 0.8021 (1) (20) $ — $ — Preferred Stock – Series M (19) : Ordinary taxable dividend $ — $ — $ — Capital gain distribution — — — Return of capital 0.3208 — — Total $ 0.3208 (1) (20) $ — $ — ____________________ (1) The fourth quarter 2023 preferred distributions paid January 16, 2024 to stockholders of record as of December 29, 2023 are treated as 2024 distributions for tax purposes.
COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN Among Ashford Hospitality Trust, Inc., the S&P Index and the FTSE NAREIT Lodging & Resorts Index 47 Purchases of Equity Securities by the Issuer The following table provides the information with respect to purchases and forfeitures of shares of our common stock during each of the months in the fourth quarter of 2024: Period Total Number of Shares Purchased Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plan (1) Maximum Dollar Value of Shares That May Yet Be Purchased Under the Plan (1) Common stock: October 1 - October 31 — $ — — $ 200,000 November 1 - November 30 — — — 200,000 December - December 31 — — — 200,000 Total — $ — — ____________________ (1) On April 6, 2022 the board of directors approved a stock repurchase program pursuant to which the board of directors granted a repurchase authorization to acquire shares of the Company’s common stock and preferred stock having an aggregate value of up to $200 million.
COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN Among Ashford Hospitality Trust, Inc., the S&P Index and the FTSE NAREIT Lodging & Resorts Index 51 Purchases of Equity Securities by the Issuer The following table provides the information with respect to purchases and forfeitures of shares of our common stock during each of the months in the fourth quarter of 2025: Period Total Number of Shares Purchased Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plan (1) Maximum Dollar Value of Shares That May Yet Be Purchased Under the Plan (1) Common stock: October 1 – October 31 — $ — — $ 200,000,000 November 1 – November 30 — — — 200,000,000 December 1 – December 31 — — — 200,000,000 Total — $ — — ____________________ (1) On April 6, 2022, the board of directors approved a stock repurchase program pursuant to which the board of directors granted a repurchase authorization to acquire shares of the Company’s common stock and preferred stock having an aggregate value of up to $200 million.
(2) As of December 31, 2024, there were approximately 16,000 shares of our common stock, or securities convertible into approximately 16,000 shares of our common stock that remained available for issuance under our 2021 Stock Incentive Plan. 46 Performance Graph The following graph compares the percentage change in the cumulative total stockholder return on our common stock with the cumulative total return of the S&P 500 Stock Index and the FTSE NAREIT Lodging & Resorts Index for the period from December 31, 2019 through December 31, 2024, assuming an initial investment of $100 in stock on December 31, 2019 with reinvestment of dividends.
(2) As of December 31, 2025, there were approximately 190,000 shares of our common stock, or securities convertible into approximately 190,000 shares of our common stock that remained available for issuance under our 2021 Stock Incentive Plan. 50 Performance Graph The following graph compares the percentage change in the cumulative total stockholder return on our common stock with the cumulative total return of the S&P 500 Stock Index and the FTSE NAREIT Lodging & Resorts Index for the period from December 31, 2020 through December 31, 2025, assuming an initial investment of $100 in stock on December 31, 2020 with reinvestment of dividends.
Equity Compensation Plan Information The following table sets forth certain information with respect to securities authorized and available for issuance under our equity compensation plans as of December 31, 2024: Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights (1) Weighted-Average Exercise Price Of Outstanding Options, Warrants, And Rights Number of Securities Remaining Available for Future Issuance Equity compensation plans approved by security holders 16,461 N/A 16,000 (2) Equity compensation plans not approved by security holders None N/A None Total 16,461 N/A 16,000 ____________________ (1) Consists of rights to acquire our common stock subject to the satisfaction of service and or performance vesting conditions (with the amount shown assuming the maximum level of performance under the 2023 PSU awards).
Equity Compensation Plan Information The following table sets forth certain information with respect to securities authorized and available for issuance under our equity compensation plans as of December 31, 2025: Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights (1) Weighted-Average Exercise Price Of Outstanding Options, Warrants, And Rights Number of Securities Remaining Available for Future Issuance Equity compensation plans approved by security holders — N/A 190,000 (2) Equity compensation plans not approved by security holders None N/A None Total — N/A 190,000 ____________________ (1) Consists of rights to acquire our common stock subject to the satisfaction of service and or performance vesting conditions.
The board of directors’ authorization replaced the previous repurchase authorization that the board of directors authorized in December 2017.
The board of directors’ authorization replaced the previous repurchase authorization that the board of directors authorized in December 2017. Item 6. Reserved
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities (a) Market Price of and Dividends on Registrant’s Common Equity and Related Stockholder Matters Market Price and Dividend Information Our common stock is listed and traded on the New York Stock Exchange under the symbol “AHT.” On March 19, 2025, there were 268 registered holders of record of our common stock.
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities (a) Market Price of and Dividends on Registrant’s Common Equity and Related Stockholder Matters Market Price and Dividend Information Our common stock is listed and traded on the New York Stock Exchange under the symbol “AHT.” On March 18, 2026, there were 263 registered holders of record of our common stock. 46 For the year ended December 31, 2025 we did not declare or pay cash dividends on our common stock.
We may incur indebtedness to meet distribution requirements imposed on REITs under the Code to the extent that working capital and cash flow from our investments are insufficient to fund required distributions.
The board of directors will continue to review our dividend policy and make future announcements with respect thereto. We may incur indebtedness to meet distribution requirements imposed on REITs under the Code to the extent that working capital and cash flow from our investments are insufficient to fund required distributions.
(12) Distributions per share reflects the annual rate per share for distributions reportable in 2023. (13) Distributions per share reflects the annual rate per share for distributions reportable in 2022.
(21) Distributions per share reflects the annual rate per share for distributions reportable in 2024. (22) Distributions per share reflects the annual rate per share for distributions reportable in 2023.
The fourth quarter 2023 preferred distributions paid January 16, 2024 to stockholders of record as of December 29, 2024 are treated as 2024 distributions for tax purposes. The fourth quarter 2024 preferred distributions paid January 15, 2025 to stockholders of record as of December 31, 2024 are treated as 2025 distributions for tax purposes.
The fourth quarter 2024 preferred distributions paid January 15, 2025 to stockholders of record as of December 31, 2024 are treated as 2025 distributions for tax purposes. The fourth quarter 2025 preferred distributions payable on January 15, 2026 to stockholders of record as of December 31, 2025 were suspended. See discussion in Item 7.
(2) Preferred Stock - Series K: (CUSIP #04410D867) (3) Preferred Stock - Series K: (CUSIP #04410D792) (4) Preferred Stock - Series K: (CUSIP #04410D727) (5) Preferred Stock - Series K: (CUSIP #04410D651) (6) Preferred Stock - Series K: (CUSIP #04410D578) 45 (7) Preferred Stock - Series K: (CUSIP #04410D511) (8) Preferred Stock - Series K: (CUSIP #04410D438) (9) Preferred Stock - Series K: (CUSIP #04410D362) (10) Preferred Stock - Series K: (CUSIP #04410D289) (11) Distributions per share reflects the annual rate per share for distributions reportable in 2024.
(2) Preferred Stock - Series J: (CUSIP #04410A863, 04410A798, 04410A723, 04410A657, 04410A574, 04410A517, 04410A434, 04410A368, 04410A285) (3) Preferred Stock - Series J: (CUSIP #04410A228) (4) Preferred Stock - Series K: (CUSIP #04410D867) (5) Preferred Stock - Series K: (CUSIP #04410D792) (6) Preferred Stock - Series K: (CUSIP #04410D727) (7) Preferred Stock - Series K: (CUSIP #04410D651) (8) Preferred Stock - Series K: (CUSIP #04410D578) (9) Preferred Stock - Series K: (CUSIP #04410D511) (10) Preferred Stock - Series K: (CUSIP #04410D438) (11) Preferred Stock - Series K: (CUSIP #04410D362) (12) Preferred Stock - Series K: (CUSIP #04410D289) (13) Preferred Stock - Series K: (CUSIP #04410D222) (14) Preferred Stock - Series L: (CUSIP #04410E204) (15) Preferred Stock - Series L: (CUSIP #04410E303) (16) Preferred Stock - Series L: (CUSIP #04410E402) (17) Preferred Stock - Series M: (CUSIP #04410E832) (18) Preferred Stock - Series M: (CUSIP #04410E824) (19) Preferred Stock - Series M: (CUSIP #04410E816) 49 (20) Distributions per share reflects the annual rate per share for distributions reportable in 2025.
Removed
For the year ended December 31, 2024 we did not declare or pay common stock dividends. On December 10, 2024, the board of directors approved our dividend policy for 2025, which continued the suspension of the Company’s common stock dividend into 2025. The board of directors will continue to review our dividend policy and make future announcements with respect thereto.
Added
As discussed in more detail above, on December 15, 2025, we declared a dividend of one Right for each outstanding share of common stock, each Right initially representing the right to purchase from the Company one one-thousandth of a share of Series N Preferred Stock at a price of $20.00 per one one-thousandth of a share of Series N Preferred Stock, subject to adjustment as provided in the Rights Agreement.
Removed
The number of shares subject to issuance under the PSUs (if any) will depend on the ultimate actual performance level, and the Company in its discretion may settle the 2023 PSUs in cash rather than shares of common stock.
Added
The dividend was paid to holders of Common Stock of record as of 5:00 p.m. New York City time on December 26, 2025. On December 15, 2025, the board of directors approved our dividend policy for 2026, which continued the suspension of the Company’s common stock dividend into 2026.
Removed
During the period between October 1, 2024 and December 31, 2024, the Company exchanged a total of approximately 13,000 shares of its common stock for an aggregate of 5,000 shares of preferred stock with certain holders of its 8.45% Series D Cumulative Preferred Stock, 7.375% Series F Cumulative Preferred Stock, 7.375% Series G Cumulative Preferred Stock, 7.50% Series H Cumulative Preferred Stock and 7.50% Series I Cumulative Preferred Stock.
Added
Further, to preserve the Company’s liquidity position as it evaluates strategic alternatives, preferred dividends have been suspended, including dividends previously declared for recordholders of the Company’s Series D, F, G, H, I, J, K, L and M preferred stock as of December 31, 2025, and payable on January 15, 2026.
Removed
The issuance of the shares of the common stock was made by the Company pursuant to the exemption from the registration requirements of Section 3(a)(9) of the Securities Act on the basis that these offers constituted an exchange with existing holders of the Company’s securities.
Added
We intend to pay the previously declared but unpaid dividends as soon as reasonably practicable. Any accrued but unpaid dividends will accrue in accordance with the terms outlined in the applicable governing documents for each series of preferred stock. We will continue to evaluate potential future dividends on a quarterly basis.
Removed
No commission or other remuneration was paid to any party for soliciting such exchange and the transactions did not involve a public offering. In consideration for the common share issuances, the Company received the preferred shares from the stockholders, which preferred shares were cancelled and of no further effect. Item 6. Reserved
Added
Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

124 edited+86 added−78 removed61 unchanged
Biggest changeBelow is a summary of the hotel properties securing the KEYS Pool A loan and KEYS Pool B loan: KEYS A Loan Pool Courtyard Columbus Tipton Lakes – Columbus, IN Courtyard Old Town – Scottsdale, AZ Residence Inn Hughes Center – Las Vegas, NV Residence Inn Phoenix Airport – Phoenix, AZ Residence Inn San Jose Newark – Newark, CA SpringHill Suites Manhattan Beach – Hawthorne, CA SpringHill Suites Plymouth Meeting – Plymouth Meeting, PA KEYS B Loan Pool Courtyard Basking Ridge – Basking Ridge, NJ Courtyard Newark Silicon Valley – Newark, CA Courtyard Oakland Airport – Oakland, CA Courtyard Plano Legacy Park – Plano, TX Residence Inn Plano – Plano, TX SpringHill Suites BWI Airport – Baltimore, MD TownePlace Suites Manhattan Beach – Hawthorne, CA We derecognized the hotel properties securing the KEYS Pool A and KEYS Pool B loans from our consolidated balance sheet in March 2024, when the receiver took control of the hotel properties, and accordingly recognized a gain of $133.9 million, which is included in “gain (loss) on derecognition of assets” in our consolidated statements of operations and recorded a contract asset of $378.2 million, which represented the liabilities we expect to be released from upon final resolution with the lenders on the KEYS Pool A and KEYS Pool B mortgage loans in exchange for the transfer of ownership of the respective hotel properties.
Biggest changeWe recorded a contract asset of $378.2 million as of March 31, 2024, which represented the liabilities from which we expect to be released upon final resolution with the lenders on the KEYS Pool A and KEYS Pool B mortgage loans in exchange for the transfer of ownership of the respective hotel properties.
On July 2, 2024, the Courtyard Plano Legacy Park and the Residence Inn Plano were foreclosed on at a public auction. Additionally, on November 4, 2024, the receiver appointed for the KEYS Pool A and KEYS Pool B mortgage loans transferred the Courtyard Columbus Tipton Lakes to a third party purchaser.
On July 2, 2024, the Courtyard Plano Legacy Park and the Residence Inn Plano were foreclosed on at a public auction. Additionally, on November 4, 2024, the receiver appointed for the KEYS Pool A and KEYS Pool B mortgage loans transferred the Courtyard Columbus Tipton Lakes to a third-party purchaser.
Cash flows provided by (used in) operations were impacted by changes in hotel operations, our hotel dispositions and derecognized assets, as well as the timing of collecting receivables from hotel guests, paying vendors, settling with derivative counterparties, settling with related parties and settling with hotel managers. Net Cash Flows Provided by (Used in) Investing Activities.
Cash flows used in operations were impacted by changes in hotel operations, our hotel dispositions and derecognized assets, as well as the timing of collecting receivables from hotel guests, paying vendors and settling with derivative counterparties, related parties and hotel managers. Net Cash Flows Provided by (Used in) Investing Activities .
We believe that the following discussion addresses our most critical accounting policies, representing those policies considered most vital to the portrayal of our financial condition and results of operations and require management’s most difficult, subjective, complex judgments and can include significant estimates.
We believe that the following discussion addresses our most critical accounting estimates, representing those policies considered most vital to the portrayal of our financial condition and results of operations and require management’s most difficult, subjective, complex judgments and can include significant estimates.
Based on our primary business objectives and forecasted operating conditions, our current key priorities and financial strategies include, among other things: • preserving capital and maintaining significant cash and cash equivalents liquidity; • disposition of non-core hotel properties; • acquisition of hotel properties, in whole or in part, that we expect will be accretive to our portfolio; • pursuing capital market activities and implementing strategies to enhance long-term stockholder value; • accessing cost effective capital, including through the issuance of non-traded preferred securities; • opportunistically exchanging preferred stock into common stock; • implementing selective capital improvements designed to increase profitability and maintain the quality of our assets; • implementing effective asset management strategies to minimize operating costs and increase revenues; 48 • financing or refinancing hotels on competitive terms; • modifying or extending property-level indebtedness; • utilizing hedges, derivatives and other strategies to mitigate risks; • pursuing opportunistic value-add additions to our hotel portfolio; and • making other investments or divestitures that our board of directors deems appropriate.
Based on our primary business objectives and forecasted operating conditions, our current key priorities and financial strategies include, among other things: • preserving capital and maintaining significant cash and cash equivalents liquidity; • disposition of non-core hotel properties; • acquisition of hotel properties, in whole or in part, that we expect will be accretive to our portfolio; • pursuing capital market activities and implementing strategies to enhance long-term stockholder value; • accessing cost effective capital, including through the issuance of non-traded preferred securities; • opportunistically exchanging preferred stock into common stock; • implementing selective capital improvements designed to increase profitability and maintain the quality of our assets; • implementing effective asset management strategies to minimize operating costs and increase revenues; • financing or refinancing hotels on competitive terms; • modifying or extending property-level indebtedness; • utilizing hedges, derivatives and other strategies to mitigate risks; • pursuing opportunistic value-add additions to our hotel portfolio; and • making other investments or divestitures that our board of directors deems appropriate.
Our calculation of Adjusted FFO excludes write-off of premiums, loan costs and exit fees, other income/expense, net, transaction and conversion costs, legal, advisory and settlement costs, stock/unit-based compensation, gains/losses on insurance settlements and non-cash items such as deemed dividends on redeemable preferred stock, amortization of loan costs, amortization of credit facility exit fee, default interest and late fees, unrealized gains/losses on derivative instruments, gains/losses on extinguishment of debt and preferred stock, severance, and interest expense associated with hotels in receivership and our portion of adjustments to FFO related to unconsolidated entities.
Our calculation of Adjusted FFO excludes write-off of premiums, loan costs and exit fees, other income/expense, net, transaction and conversion costs, legal, advisory and settlement costs, stock/unit-based compensation, gains/losses on insurance settlements and non-cash items such as deemed dividends on redeemable preferred stock, amortization of loan costs, amortization of credit facility exit fees, default interest and late fees, unrealized gains/losses on derivative instruments, gains/losses on extinguishment of debt and preferred stock, severance, and interest expense associated with hotels in receivership and our portion of adjustments to FFO related to unconsolidated entities.
Early adoption is still permitted. The amendments may be applied either (1) prospectively to financial statements issued for reporting periods after the effective date of this ASU or (2) retrospectively to all prior periods presented in the financial statements. We are currently evaluating the impact this ASU will have on our disclosures.
Early 68 adoption is still permitted. The amendments may be applied either (1) prospectively to financial statements issued for reporting periods after the effective date of this ASU or (2) retrospectively to all prior periods presented in the financial statements. We are currently evaluating the impact this ASU will have on our disclosures.
We present EBITDA, EBITDAre and Adjusted EBITDAre because we believe they are useful to an investor in evaluating our operating performance because it provides investors with an indication of our ability to incur and service debt, to satisfy 66 general operating expenses, to make capital expenditures and to fund other cash needs or reinvest cash into our business.
We present EBITDA, EBITDAre and Adjusted EBITDAre because we believe they are useful to an investor in evaluating our operating performance because it provides investors with an indication of our ability to incur and service debt, to satisfy general operating expenses, to make capital expenditures and to fund other cash needs or reinvest cash into our business.
The registration statement was declared effective by the SEC on February 7, 2025, and contemplates the offering of up to (i) 8.4 million shares of Series L Preferred Stock and 3.6 million shares of Series M Preferred Stock in a primary offering and (ii) 2.8 million shares of Series L Preferred Stock and 1.2 million shares of Series M Preferred Stock pursuant to a dividend reinvestment plan.
The registration statement was declared effective by the SEC on February 7, 2025, and contemplates the offering of up to (i) 8.4 million shares of Series L Redeemable Preferred Stock and 3.6 million shares of Series M Redeemable Preferred Stock in a primary offering and (ii) 2.8 million shares of Series L Redeemable Preferred Stock and 1.2 million shares of Series M Redeemable Preferred Stock pursuant to a dividend reinvestment plan.
Distributions to our stockholders are generally taxable to our stockholders as ordinary income. However, since a portion of our investments are equity ownership interests in hotels, which result in depreciation and non-cash charges against our income, a portion of our distributions may constitute a non-taxable return of capital, to the extent of a 64 stockholder’s tax basis in the stock.
Distributions to our stockholders are generally taxable to our stockholders as ordinary income. However, since a portion of our investments are equity ownership interests in hotels, which result in depreciation and non-cash charges against our income, a portion of our distributions may constitute a non-taxable return of capital, to the extent of a stockholder’s tax basis in the stock.
Income Taxes —As a REIT, we generally are not subject to federal corporate income tax on the portion of our net income (loss) that does not relate to taxable REIT subsidiaries. However, Ashford TRS is treated as a TRS for U.S. federal income tax purposes.
Income Taxes —As a REIT, we generally are not subject to federal corporate income tax on the portion of our net income (loss) that does not relate to taxable REIT subsidiaries. However, Ashford TRS is treated as a taxable REIT subsidiary for U.S. federal income tax purposes.
Dividend Policy . Distributions are authorized by our board of directors and declared by us based upon a variety of factors deemed relevant by our directors. The board of directors will continue to review our distribution policy on at least a quarterly basis.
Distributions are authorized by our board of directors and declared by us based upon a variety of factors deemed relevant by our directors. The board of directors will continue to review our distribution policy on at least a quarterly basis.
We have entered into customary guaranty agreements pursuant to which we guaranty payment of any recourse liabilities of the borrowers that result from non-recourse carve-outs (which include, but are not limited to, fraud, misrepresentation, willful conduct resulting in waste, misappropriations of rents following an event of default, voluntary bankruptcy filings, unpermitted transfers of collateral, and certain environmental liabilities).
We have entered into customary guaranty agreements pursuant to which we guaranty payment of any recourse liabilities of the borrowers that result from non-recourse carve-outs (which include, but are not limited to, fraud, misrepresentation, willful conduct resulting in waste, misappropriation of rents following an event of default, voluntary bankruptcy filings, unpermitted transfers of collateral and certain environmental liabilities).
Mortgage and mezzanine loans are nonrecourse to the borrowers, except for customary exceptions or carve-outs that trigger recourse liability to the borrowers in certain limited instances. Recourse obligations typically include only the payment of costs and liabilities suffered by lenders as a result of the occurrence of certain bad acts on the part of the borrower.
Mortgage and mezzanine loans are non-recourse to the borrowers, except for customary exceptions or carve-outs that trigger recourse liability to the borrowers in certain limited instances. Recourse obligations typically include only the payment of costs and liabilities suffered by lenders as a result of the occurrence of certain bad acts on the part of the borrower.
Discussions of 2023 items and year-to-year comparisons between 2023 and 2022 that are not included in this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.
Discussions of 2024 items and year-to-year comparisons between 2024 and 2023 that are not included in this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.
On February 12, 2025, the Company closed on a $580 million refinancing secured by 16 hotels. The financing includes the hotels that were previously part of the Company’s KEYS Pool C Loan, KEYS Pool D Loan, KEYS Pool E Loan, and the BAML Pool 3 Loan, together with the Westin Princeton.
Other Loan Activity On February 12, 2025, the Company closed on a $580 million refinancing secured by 16 hotels. The financing includes the hotels that were previously part of the Company’s KEYS Pool C Loan, KEYS Pool D Loan, KEYS Pool E Loan, and the BAML Pool 3 Loan, together with the Westin Princeton.
Based on when a hotel property was acquired or disposed, operating results for certain hotel properties are not comparable for the years ended December 31, 2024 and 2023. The hotel properties listed below are not comparable hotel properties for the periods indicated and all other hotel properties are considered comparable hotel properties.
Based on when a hotel property was acquired or disposed, operating results for certain hotel properties are not comparable for the years ended December 31, 2025 and 2024. The hotel properties listed below are not comparable hotel properties for the periods indicated and all other hotel properties are considered comparable hotel properties.
In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40) Disaggregation of Income Statement Expenses that requires more detailed information about specified categories of expenses (purchases of inventory, employee compensation, depreciation, amortization, and depletion) included in certain expense captions presented on the face of the statement of operations.
RECENTLY ISSUED ACCOUNTING STANDARDS In November 2024, the FASB issued ASU 2024-03 , Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40) Disaggregation of Income Statement Expenses that requires more detailed information about specified categories of expenses (purchases of inventory, employee compensation, depreciation, amortization, and depletion) included in certain expense captions presented on the face of the statement of operations.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations This section of this Form 10-K generally discusses 2024 and 2023 items and year-to-year comparisons between 2024 and 2023.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations This section of this Form 10-K generally discusses 2025 and 2024 items and year-to-year comparisons between 2025 and 2024.
We classify interest and penalties related to underpayment of income taxes as income tax expense. We and our subsidiaries file income tax returns in the U.S. federal jurisdiction and various states and cities. Tax years 2020 through 2024 remain subject to potential examination by certain federal and state taxing authorities.
We classify interest and penalties related to underpayment of income taxes as income tax expense. We and our subsidiaries file income tax returns in the U.S. federal jurisdiction and various states and cities. Tax years 2021 through 2025 remain subject to potential examination by certain federal and state taxing authorities.
NOLs become subject to an annual limitation in the event of certain cumulative changes in the ownership of significant shareholders over a three-year period in excess of 50%, as defined under Section 382 of the Internal Revenue Code. The remaining $55.8 million of our TRS NOLs are not subject to the limitations of Section 382.
NOLs become subject to an annual limitation in the event of certain cumulative changes in the ownership of significant shareholders over a three-year period in excess of 50%, as defined under Section 382 of the Internal Revenue Code. The remaining $91.7 million of our TRS federal NOLs are not subject to the limitations of Section 382.
RECENTLY ISSUED ACCOUNTING STANDARDS In December 2023, the FASB issued ASU 2023-09 "Income Taxes (Topics 740): Improvements to Income Tax Disclosures" to expand the disclosure requirements for income taxes, specifically related to the rate reconciliation and income taxes paid. ASU 2023-09 is effective for our annual periods beginning January 1, 2025, with early adoption permitted.
RECENTLY ADOPTED ACCOUNTING STANDARDS In December 2023, the FASB issued ASU 2023-09 Income Taxes (Topics 740): Improvements to Income Tax Disclosures to expand the disclosure requirements for income taxes, specifically related to the rate reconciliation and income taxes paid. ASU 2023-09 is effective for our annual periods beginning January 1, 2025.
In addition, the analysis utilized by us in determining our deferred tax asset valuation allowance involves considerable management judgment and assumptions. See note 20 to our consolidated financial statements. At December 31, 2024 and 2023, we recorded a valuation allowance of $37.6 million and $29.3 million, respectively on the net deferred tax assets of our taxable REIT subsidiaries.
In addition, the analysis utilized by us in determining our deferred tax asset valuation allowance involves considerable management judgment and assumptions. See note 20 to our consolidated financial statements. At December 31, 2025 and 2024, we recorded a valuation allowance of $45.9 million and $37.6 million, respectively on the net deferred tax assets of our taxable REIT subsidiaries.
The decrease in interest income in 2024 was primarily attributable to lower excess cash balances in 2024 compared to 2023. Other Income (Expense). In 2024 and 2023 we recorded miscellaneous income of $108,000 and $310,000, respectively. Interest Expense and Amortization of Discounts and Loan Costs.
The decrease in interest income in 2025 was primarily attributable to lower excess cash balances in 2025 compared to 2024. Other Income (Expense) . In 2025 and 2024, we recorded miscellaneous income of $0 and $108,000, respectively. Interest Expense and Amortization of Discounts and Loan Costs .
Pursuant to the 2025 Advisory Agreement Limited Waiver, 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 year 2025, cash incentive compensation to employees and other representatives of the Advisor.
Pursuant to the 2026 Advisory Agreement Limited Waiver, the Company, the Operating Partnership, TRS, Ashford Inc. and Ashford LLC 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 year 2026, cash incentive compensation to employees and other representatives of Ashford Inc. and Ashford LLC.
The ability to make repurchases under the Repurchase Program is subject to the same financial factors that must be taken into account in declaring a dividend as discussed herein under “Distribution Policy.” On April 11, 2022, the Company entered into the Virtu Equity Distribution Agreement with Virtu, to sell from time to time shares of the Company’s common stock having an aggregate offering price of up to $100 million.
The ability to make repurchases under the Repurchase Program is subject to the same financial factors that must be taken into account in declaring a dividend as discussed herein under “Distribution Policy.” The Company has a distribution agreement with Virtu (the “Virtu Equity Distribution Agreement”) to sell from time to time shares of the Company’s common stock having an aggregate offering price of up to $100 million.
As of December 31, 2024, we have $1.8 billion of mortgage loans that have final maturities in 2025. We hold extension options for the remaining mortgage loans due in the next twelve months. Additionally, we have amortization payments of approximately $133,000 due in the next twelve months.
As of December 31, 2025, we have $1.1 billion of mortgage loans that have final maturities in 2026. We hold extension options for the remaining mortgage loans due in the next twelve months. Additionally, we have amortization payments of approximately $149,000 due in the next twelve months.
The original lenders previously transferred the loans to a securitization trust. On March 1, 2024, the Company received notice that the hotel properties securing the KEYS A and KEYS B loan pools have been transferred to a court-appointed receiver.
The original lenders previously transferred the loans to a securitization trust. On March 1, 2024, the Company received notice that the hotel properties that secured the KEYS Pool A and KEYS Pool B loans have been transferred to a court-appointed receiver.
The remainder were generated after December 31, 2017 and are not subject to expiration under the Tax Cuts and Jobs Act. The “Income Taxes” topic of the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification addresses the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements.
The remainder were generated after December 31, 2017 and are not subject to expiration under the Tax Cuts and Jobs Act. The “Income Taxes” topic of the ASC issued by the Financial Accounting Standards Board (“FASB”) which addresses the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements.
Our estimated future obligations as of December 31, 2024 include both current and long-term obligations. With respect to our indebtedness, as discussed in note 7 to our consolidated financial statements, we have current obligations of $2.1 billion and long-term obligations of $577.7 million.
Our estimated future obligations as of December 31, 2025 include both current and long-term obligations. With respect to our indebtedness as of December 31, 2025, as discussed in note 7 to our consolidated financial statements, we have current obligations of $1.5 billion and long-term obligations of $1.1 billion.
The previous loans had a combined outstanding loan balance of approximately $438.7 million. The new financing is non-recourse, has a two-year term with three one-year extension options, subject to the satisfaction of certain conditions, and bears interest at a floating interest rate of SOFR + 4.37%.
The previous loans had a combined outstanding loan balance of approximately $438.7 million. The new financing is non-recourse, has a two-year term with three one-year extension options, subject to the satisfaction of certain conditions.
The advisory services fee represents fees incurred in connection with the advisory agreements between Ashford Inc. and the Company and between Ashford Inc. and Stirling OP.
The advisory services fee represents fees incurred in connection with the advisory agreements between Ashford Inc. and the Company and, prior to September 2, 2025, between Ashford Inc. and Stirling OP.
We recorded a $59.3 million impairment charge for the year ended December 31, 2024 and no impairment charges for the years ended December 31, 2023 and 2022. See note 5 to our consolidated financial statements.
We 67 recorded $67.6 million and $59.3 million of impairment charges for the years ended December 31, 2025 and 2024, respectively. No impairment charge was recorded for the year ended December 31, 2023. See note 5 to our consolidated financial statements.
The Third Amendment further extends the outside date for which any sale or disposition of any of the Company’s Highland loan portfolio and JPM8 hotel properties securing the associated mortgage loans following certain defaults (as described in the Ashford Trust Advisory Agreement), including a maturity default, would be excluded from the numerator of the calculation of the percentage of gross book value of the Company’s assets sold or disposed (but, for the avoidance of doubt, included in the denominator of such calculation) for 51 purposes of determining whether a Company Change of Control (as defined in the Advisory Agreement) has occurred, from November 30, 2025 to March 31, 2026.
The Sixth Amendment further extends the outside date for which any sale or disposition of any of the Company’s Highland Portfolio and JPM8 hotel properties securing the associated mortgage loans following an event of default (as defined in the Advisory Agreement) would be excluded from the numerator of the calculation of the percentage of gross book value of the Company’s assets sold or disposed (but, for the avoidance of doubt, included in the denominator of such calculation) for purposes of determining whether a Company Change of Control (as defined in the Advisory Agreement) has occurred, from August 15, 2026 to November 15, 2026.
The Company’s cash and cash equivalents are primarily comprised of corporate cash invested in short-term U.S. Treasury securities with maturity dates of less than 90 days and corporate cash held at commercial banks in Insured Cash Sweep (“ICS”) accounts, which are fully insured by the FDIC.
Treasury securities with maturity dates of less than 90 days and corporate cash held at commercial banks in Insured Cash Sweep (“ICS”) accounts, which are fully insured by the FDIC.
In total $3.0 million of our TRS NOLs are subject to expiration and will begin to expire in 2025. The remainder was generated after December 31, 2017 and are not subject to expiration under the Tax Cuts and Jobs Act.
In total $1.9 million of our TRS federal NOLs are subject to expiration and will begin to expire in 2026. The remainder were generated after December 31, 2017 and are not subject to expiration under the Tax Cuts and Jobs Act.
However, to facilitate a clear understanding of our historical operating results, we believe that FFO and Adjusted FFO should be considered along with our net income or loss and cash flows reported in the consolidated financial statements. 68 The following table reconciles net income (loss) to FFO and Adjusted FFO (in thousands): Year Ended December 31, 2024 2023 2022 Net income (loss) $ (65,011) $ (180,734) $ (141,058) (Income) loss attributable to noncontrolling interest in consolidated entities 4,028 6 — Net (income) loss attributable to redeemable noncontrolling interests in operating partnership 683 2,239 1,233 Preferred dividends (22,686) (15,921) (12,433) Deemed dividends on redeemable preferred stock (2,906) (2,673) (946) Gain (loss) on extinguishment of preferred stock 3,370 3,390 — Net income (loss) attributable to common stockholders (82,522) (193,693) (153,204) Depreciation and amortization of real estate 152,776 187,807 201,797 Gain (loss) on consolidation of VIE and disposition of assets and hotel properties (94,406) (11,488) (300) (Gain) loss on derecognition of assets (167,177) — — Net income (loss) attributable to redeemable noncontrolling interests in operating partnership (683) (2,239) (1,233) Equity in (earnings) loss of unconsolidated entities 2,370 1,134 804 Impairment charges on real estate 59,331 — — Company’s portion of FFO of unconsolidated entities (932) (668) (771) FFO available to common stockholders and OP unitholders (131,243) (19,147) 47,093 Deemed dividends on redeemable preferred stock 2,906 2,673 946 (Gain) loss on extinguishment of preferred stock (3,370) (3,390) — Transaction and conversion costs 10,809 3,856 (2,300) Write-off of premiums, loan costs and exit fees 5,245 3,469 3,536 Unrealized (gain) loss on derivatives 32,790 44,041 (10,781) Stock/unit-based compensation 2,097 4,027 5,998 Legal, advisory and settlement costs 3,230 1,181 1,936 Other (income) expense, net (108) (310) (412) Amortization of term loan exit fee 844 18,616 11,948 Amortization of loan costs 13,591 12,735 9,672 (Gain) loss on insurance settlements (73) (505) (342) (Gain) loss on extinguishment of debt (2,774) (53,386) — Interest expense associated with hotels in receivership 40,045 — — Severance 2,824 — — Default interest and late fees — 12,553 — Company’s portion of adjustments to FFO of unconsolidated entities 125 2 16 Adjusted FFO available to common stockholders and OP unitholders $ (23,062) $ 26,415 $ 67,310 69
However, to facilitate a clear understanding of our historical operating results, we believe that FFO and Adjusted FFO should be considered along with our net income or loss and cash flows reported in the consolidated financial statements. 71 The following table reconciles net income (loss) to FFO and Adjusted FFO (in thousands): Year Ended December 31, 2025 2024 2023 Net income (loss) $ (188,159) $ (65,011) $ (180,734) (Income) loss attributable to noncontrolling interest in consolidated entities 5,058 4,028 6 Net (income) loss attributable to redeemable noncontrolling interests in operating partnership 3,262 683 2,239 Preferred dividends (28,216) (22,686) (15,921) Deemed dividends on redeemable preferred stock (6,949) (2,906) (2,673) Gain (loss) on extinguishment of preferred stock — 3,370 3,390 Net income (loss) attributable to common stockholders (215,004) (82,522) (193,693) Depreciation and amortization of real estate 138,441 152,776 187,807 (Gain) loss on consolidation of VIE and disposition of assets and hotel properties (79,799) (94,406) (11,488) (Gain) loss on derecognition of assets (39,054) (167,177) — Net income (loss) attributable to redeemable noncontrolling interests in operating partnership (3,262) (683) (2,239) Equity in (earnings) loss of unconsolidated entities 325 2,370 1,134 Impairment charges on real estate 67,648 59,331 — Company’s portion of FFO of unconsolidated entities 192 (932) (668) FFO available to common stockholders and OP unitholders (130,513) (131,243) (19,147) Deemed dividends on redeemable preferred stock 6,949 2,906 2,673 (Gain) loss on extinguishment of preferred stock — (3,370) (3,390) Transaction and conversion costs 9,549 10,809 3,856 Write-off of premiums, loan costs and exit fees 8,853 5,245 3,469 Unrealized (gain) loss on derivatives 7,064 32,790 44,041 Stock/unit-based compensation (760) 2,097 4,027 Legal, advisory and settlement costs 1,871 3,230 1,181 Other (income) expense, net — (108) (310) Amortization of term loan exit fee — 844 18,616 Amortization of loan costs 25,490 13,591 12,735 (Gain) loss on insurance settlements (2,950) (73) (505) (Gain) loss on extinguishment of debt (335) (2,774) (53,386) Interest expense associated with hotels in receivership 39,038 40,045 — Severance 1,228 2,824 — Default interest and late fees — — 12,553 Company’s portion of adjustments to FFO of unconsolidated entities 105 125 2 Adjusted FFO available to common stockholders and OP unitholders $ (34,411) $ (23,062) $ 26,415 72
Below is a summary of the hotel properties securing the KEYS Pool A loan and Keys Pool B loan: KEYS A Loan Pool Courtyard Columbus Tipton Lakes – Columbus, IN Courtyard Old Town – Scottsdale, AZ Residence Inn Hughes Center – Las Vegas, NV Residence Inn Phoenix Airport – Phoenix, AZ Residence Inn San Jose Newark – Newark, CA SpringHill Suites Manhattan Beach – Hawthorne, CA SpringHill Suites Plymouth Meeting – Plymouth Meeting, PA KEYS B Loan Pool Courtyard Basking Ridge – Basking Ridge, NJ Courtyard Newark Silicon Valley – Newark, CA Courtyard Oakland Airport – Oakland, CA Courtyard Plano Legacy Park – Plano, TX Residence Inn Plano – Plano, TX SpringHill Suites BWI Airport – Baltimore, MD TownePlace Suites Manhattan Beach – Hawthorne, CA We derecognized the hotel properties securing the KEYS Pool A and KEYS Pool B loans from our consolidated balance sheet in March 2024, when the receiver took control of the hotel properties, and accordingly recognized a gain of $133.9 million, which is included in “gain (loss) on derecognition of assets” in our consolidated statements of operations and recorded a contract asset of $378.2 million, which represented the liabilities we expect to be released from upon final resolution with the lenders on the KEYS Pool A and KEYS Pool B mortgage loans in exchange for the transfer of ownership of the respective hotel properties.
Below is a summary of the hotel properties that secured the KEYS Pool A and Pool B loans: KEYS A Loan Pool Courtyard Columbus Tipton Lakes – Columbus, IN Courtyard Old Town – Scottsdale, AZ Residence Inn Hughes Center – Las Vegas, NV Residence Inn Phoenix Airport – Phoenix, AZ Residence Inn San Jose Newark – Newark, CA SpringHill Suites Manhattan Beach – Hawthorne, CA SpringHill Suites Plymouth Meeting – Plymouth Meeting, PA KEYS B Loan Pool Courtyard Basking Ridge – Basking Ridge, NJ Courtyard Newark Silicon Valley – Newark, CA 63 Courtyard Oakland Airport – Oakland, CA Courtyard Plano Legacy Park – Plano, TX Residence Inn Plano – Plano, TX SpringHill Suites BWI Airport – Baltimore, MD TownePlace Suites Manhattan Beach – Hawthorne, CA We derecognized the hotel properties that secured the KEYS Pool A and KEYS Pool B loans from our consolidated balance sheet in March 2024, when the receiver took control of the hotel properties and, accordingly, recognized a gain of $133.9 million, which is included in “gain (loss) on derecognition of assets” in our consolidated statements of operations for the three months ended March 31, 2024.
See “Non-GAAP Financial Measures.” Principal Factors Affecting Our Results of Operations The principal factors affecting our operating results include overall demand for hotel rooms compared to the supply of available hotel rooms, and the ability of our third-party management companies to increase or maintain revenues while controlling expenses. 52 Demand —The demand for lodging, including business travel, is directly correlated to the overall economy; as GDP increases, lodging demand typically increases.
See “Non-GAAP Financial Measures.” Principal Factors Affecting Our Results of Operations The principal factors affecting our operating results include overall demand for hotel rooms compared to the supply of available hotel rooms, and the ability of our third-party management companies to increase or maintain revenues while controlling expenses.
At December 31, 2024, we had TRS NOLs for U.S. federal income tax purposes of $139.4 million, however $83.6 million of our NOLs are subject to limitation in the amount of approximately $7.3 million per year through 2025, and $1.2 million per year thereafter under Section 382 of the Internal Revenue Code.
At December 31, 2025, we had TRS NOLs for U.S. federal income tax purposes of $174.2 million, however $82.5 million of our NOLs are subject to limitation in the amount of approximately $1.2 million per year under Section 382 of the Internal Revenue Code.
As discussed in note 19 to our consolidated financial statements, under our operating and finance leases we have current obligations of $7.2 million and long-term obligations of $704.1 million.
As discussed in note 19 to our consolidated financial statements, under our operating and finance leases we have current obligations of $5.7 million and long-term obligations of $258.7 million. Additionally, we have short-term capital commitments of $64.2 million.
On December 13, 2024, the Company filed an initial registration statement on Form S-11 with the SEC, as amended on January 23, 2025, related to the Company’s non-traded Series L Preferred Stock and Series M Preferred Stock.
As of March 18, 2026, the Company has not issued any securities from this registration statement. On December 13, 2024, the Company filed an initial registration statement on Form S-11 with the SEC, as amended on January 23, 2025, related to the Company’s non-traded Series L Redeemable Preferred Stock and Series M Redeemable Preferred Stock.
Thus, changes in ADR have a more significant impact on operating margins than changes in occupancy. 53 The following table summarizes the changes in key line items from our consolidated statements of operations for the year ended December 31, 2024 and 2023 (in thousands): Year Ended December 31, Favorable (Unfavorable) Change 2024 2023 2022 2024 to 2023 2023 to 2022 Total revenue $ 1,172,459 $ 1,367,533 $ 1,240,859 $ (195,074) $ 126,674 Total hotel expenses (815,356) (925,437) (835,993) 110,081 (89,444) Property taxes, insurance and other (64,103) (70,226) (67,338) 6,123 (2,888) Depreciation and amortization (152,776) (187,807) (201,797) 35,031 13,990 Impairment charges (59,331) — — (59,331) — Advisory service fee (58,606) (48,927) (49,897) (9,679) 970 Corporate, general and administrative (24,662) (16,181) (9,879) (8,481) (6,302) Gain (loss) on consolidation of VIE and disposition of assets and hotel properties 94,406 11,488 300 82,918 11,188 Gain (loss) on derecognition of assets 167,177 — — 167,177 — Operating income (loss) 259,208 130,443 76,255 128,765 54,188 Equity in earnings (loss) of unconsolidated entities (2,370) (1,134) (804) (1,236) (330) Interest income 6,942 8,978 4,777 (2,036) 4,201 Other income (expense) 108 310 415 (202) (105) Interest expense and amortization of discounts and loan costs (273,359) (326,970) (207,916) 53,611 (119,054) Interest expense associated with hotels in receivership (45,592) (39,178) (19,079) (6,414) (20,099) Write-off of premiums, loan costs and exit fees (5,245) (3,469) (3,536) (1,776) 67 Gain (loss) on extinguishment of debt 2,774 53,386 — (50,612) 53,386 Realized and unrealized gain (loss) on derivatives (6,480) (2,200) 15,166 (4,280) (17,366) Income tax benefit (expense) (997) (900) (6,336) (97) 5,436 Net income (loss) (65,011) (180,734) (141,058) 115,723 (39,676) (Income) loss from consolidated entities attributable to noncontrolling interests 4,028 6 — 4,022 6 Net (income) loss attributable to redeemable noncontrolling interests in operating partnership 683 2,239 1,233 (1,556) 1,006 Net income (loss) attributable to the Company $ (60,300) $ (178,489) $ (139,825) $ 118,189 $ (38,664) 54 All hotel properties held during the years ended December 31, 2024 and 2023 have been included in our results of operations during the respective periods in which they were held.
Thus, changes in ADR have a more significant impact on operating margins than changes in occupancy. 56 The following table summarizes the changes in key line items from our consolidated statements of operations for the years ended December 31, 2025 and 2024 (in thousands): Year Ended December 31, Favorable (Unfavorable) Change 2025 2024 2023 2025 to 2024 2024 to 2023 Total revenue $ 1,104,388 $ 1,172,459 $ 1,367,533 $ (68,071) $ (195,074) Total hotel expenses (768,268) (815,356) (925,437) 47,088 110,081 Property taxes, insurance and other (59,793) (64,103) (70,226) 4,310 6,123 Depreciation and amortization (141,295) (152,776) (187,807) 11,481 35,031 Impairment charges (67,648) (59,331) — (8,317) (59,331) Advisory service fee (49,039) (58,606) (48,927) 9,567 (9,679) Corporate, general and administrative (20,783) (24,662) (16,181) 3,879 (8,481) Gain (loss) on consolidation of VIE and disposition of assets and hotel properties 79,799 94,406 11,488 (14,607) 82,918 Gain (loss) on derecognition of assets 39,054 167,177 — (128,123) 167,177 Operating income (loss) 116,415 259,208 130,443 (142,793) 128,765 Equity in earnings (loss) of unconsolidated entities (325) (2,370) (1,134) 2,045 (1,236) Interest income 4,739 6,942 8,978 (2,203) (2,036) Other income (expense) — 108 310 (108) (202) Interest expense and amortization of discounts and loan costs (256,229) (273,359) (326,970) 17,130 53,611 Interest expense associated with hotels in receivership (39,038) (45,592) (39,178) 6,554 (6,414) Write-off of premiums, loan costs and exit fees (8,853) (5,245) (3,469) (3,608) (1,776) Gain (loss) on extinguishment of debt 335 2,774 53,386 (2,439) (50,612) Realized and unrealized gain (loss) on derivatives (5,346) (6,480) (2,200) 1,134 (4,280) Income tax benefit (expense) 143 (997) (900) 1,140 (97) Net income (loss) (188,159) (65,011) (180,734) (123,148) 115,723 (Income) loss from consolidated entities attributable to noncontrolling interests 5,058 4,028 6 1,030 4,022 Net (income) loss attributable to redeemable noncontrolling interests in operating partnership 3,262 683 2,239 2,579 (1,556) Net income (loss) attributable to the Company $ (179,839) $ (60,300) $ (178,489) $ (119,539) $ 118,189 57 All hotel properties held during the years ended December 31, 2025 and 2024 have been included in our results of operations during the respective periods in which they were held.
We evaluate individual hotel RevPAR performance on an absolute basis with comparisons to budget and prior periods, as well as on a regional and company-wide basis. ADR and RevPAR include only rooms revenue. Rooms revenue is dictated by demand (as measured by occupancy), pricing (as measured by ADR) and our available supply of hotel rooms.
We evaluate individual hotel RevPAR performance on an absolute basis with comparisons to budget and prior periods, as well as on a regional and company-wide basis. ADR and RevPAR include only rooms revenue.
For the year ended December 31, 2024, net cash flows provided by investing activities were $191.3 million.
For the year ended December 31, 2025, net cash flows provided by investing activities were $190.8 million.
As of March 19, 2025, the Company has issued approximately 7.4 million shares (exclusive of the dividend reinvestment plan shares) of Series J Preferred Stock and received net proceeds of approximately $166.8 million and approximately 720,000 shares (exclusive of the dividend reinvestment plan shares) of Series K Preferred Stock and received net proceeds of approximately $17.5 million.
As of March 18, 2026, the Company has issued approximately 7.7 million shares (exclusive of the dividend reinvestment plan shares) of Series J Preferred Stock and received net proceeds of approximately $172.6 million and approximately 799,000 shares (exclusive of the dividend reinvestment plan shares) of Series K Preferred Stock and received net proceeds of approximately $19.4 million.
LIQUIDITY AND CAPITAL RESOURCES Liquidity As of December 31, 2024 , the Company held cash and cash equivalents of $112.9 million and restricted cash of $107.6 million (including amounts held for sale), the vast majority of which is comprised of lender and manager-held reserves.
LIQUIDITY AND CAPITAL RESOURCES Liquidity As of December 31, 2025 , the Company held cash and cash equivalents of $66.8 million and restricted cash of $149.6 million (including amounts held for sale), the vast majority of which comprises lender and manager-held reserves.
As of December 31, 2024, $21.6 million (including amounts held for sale) was also due to the Company from third-party hotel managers, most of which is held by one of the Company’s managers and is available to fund hotel operating costs. At December 31, 2024, our net debt to gross assets was 69.5%.
As of December 31, 2025, $25.7 million (including amounts held for sale) was also due to the Company from third-party hotel managers, most of which is held by one of the Company’s managers and is available to fund hotel operating costs.
We also use funds from operations (“FFO”), Adjusted FFO, earnings before interest, taxes, depreciation and amortization for real estate (“EBITDAre”) and Adjusted EBITDAre as measures of the operating performance of our business.
Rooms revenue is dictated by demand (as measured by occupancy), pricing (as measured by ADR) and our available supply of hotel rooms. 55 We also use funds from operations (“FFO”), Adjusted FFO, earnings before interest, taxes, depreciation and amortization for real estate (“EBITDAre”) and Adjusted EBITDAre as measures of the operating performance of our business.
At December 31, 2024, 12 of our hotels were in cash traps and approximately $2.6 million of our restricted cash was subject to these cash traps. 59 Our loans currently in cash traps may remain subject to cash trap provisions for a substantial period of time, which could limit our flexibility and adversely affect our financial condition or our qualification as a REIT.
Our loans currently in cash traps may remain subject to cash trap provisions for a substantial period of time, which could limit our flexibility and adversely affect our financial condition or our qualification as a REIT.
The Company is in active discussions with the lender regarding a multi-year extension of the mortgage loan. Equity Transactions On March 4, 2022, the Company filed an initial registration statement on Form S-3 with the SEC, as amended on April 29, 2022, related to the Company’s non-traded Series J Preferred Stock and Series K Preferred Stock.
On March 4, 2022, the Company filed an initial registration statement on Form S-3 with the SEC, as amended on April 29, 2022, related to the Company’s non-traded Series J Preferred Stock and Series K Preferred Stock.
The following table reconciles net income (loss) to EBITDA, EBITDAre and Adjusted EBITDAre (in thousands): Year Ended December 31, 2024 2023 2022 Net income (loss) $ (65,011) $ (180,734) $ (141,058) Interest expense and amortization of discounts and loan costs 273,359 326,970 207,916 Interest expense associated with hotels in receivership 45,592 39,178 19,079 Depreciation and amortization 152,776 187,807 201,797 Income tax expense (benefit) 997 900 6,336 Equity in (earnings) loss of unconsolidated entities 2,370 1,134 804 Company’s portion of EBITDA of unconsolidated entities 436 231 (674) EBITDA 410,519 375,486 294,200 Impairment charges on real estate 59,331 — — Gain (loss) on consolidation of VIE and disposition of assets and hotel properties (94,406) (11,488) (300) Gain (loss) on derecognition of assets (167,177) — — EBITDAre 208,267 363,998 293,900 Amortization of unfavorable contract liabilities (122) (15) 181 Transaction and conversion costs 10,809 3,856 (2,300) Write-off of premiums, loan costs and exit fees 5,245 3,469 3,536 Realized and unrealized (gain) loss on derivatives 6,480 2,200 (10,781) Stock/unit-based compensation 2,097 4,027 5,998 Legal, advisory and settlement costs 3,230 1,181 1,936 Other (income) expense, net (108) (310) (4,797) (Gain) loss on insurance settlements (73) (505) (342) (Gain) loss on extinguishment of debt (2,774) (53,386) — Severance 2,824 — — Company’s portion of adjustments to EBITDAre of unconsolidated entities 6 2 16 Adjusted EBITDAre $ 235,881 $ 324,517 $ 287,347 67 We calculate FFO and Adjusted FFO in the following table.
EBITDA, EBITDAre and Adjusted EBITDAre do not represent cash generated from operating activities determined in accordance with GAAP, and should not be considered as an alternative to operating income (loss) or net income (loss) determined in accordance with GAAP as an indicator of performance or as an alternative to cash flows from operating activities as determined by GAAP as an indicator of liquidity. 69 The following table reconciles net income (loss) to EBITDA, EBITDAre and Adjusted EBITDAre (in thousands): Year Ended December 31, 2025 2024 2023 Net income (loss) $ (188,159) $ (65,011) $ (180,734) Interest expense and amortization of discounts and loan costs 256,229 273,359 326,970 Interest expense associated with hotels in receivership 39,038 45,592 39,178 Depreciation and amortization 141,295 152,776 187,807 Income tax expense (benefit) (143) 997 900 Equity in (earnings) loss of unconsolidated entities 325 2,370 1,134 Company’s portion of EBITDA of unconsolidated entities 1,208 436 231 EBITDA 249,793 410,519 375,486 Impairment charges on real estate 67,648 59,331 — (Gain) loss on consolidation of VIE and disposition of assets and hotel properties (79,799) (94,406) (11,488) (Gain) loss on derecognition of assets (39,054) (167,177) — EBITDAre 198,588 208,267 363,998 Amortization of unfavorable contract liabilities (122) (122) (15) Transaction and conversion costs 9,549 10,809 3,856 Write-off of premiums, loan costs and exit fees 8,853 5,245 3,469 Realized and unrealized (gain) loss on derivatives 5,346 6,480 2,200 Stock/unit-based compensation (760) 2,097 4,027 Legal, advisory and settlement costs 1,871 3,230 1,181 Other (income) expense, net — (108) (310) (Gain) loss on insurance settlements (2,950) (73) (505) (Gain) loss on extinguishment of debt (335) (2,774) (53,386) Severance 1,228 2,824 — Company’s portion of adjustments to EBITDAre of unconsolidated entities — 6 2 Adjusted EBITDAre $ 221,268 $ 235,881 $ 324,517 70 We calculate FFO and Adjusted FFO in the following table.
The following transactions affect the reporting comparability of our consolidated financial statements: Hotel Properties Location Type Date WorldQuest Resort (1) Orlando, FL Disposition August 1, 2023 Sheraton Bucks County (1) Langhorne, PA Disposition November 9, 2023 Embassy Suites Flagstaff (1) Flagstaff, AZ Disposition December 4, 2023 Embassy Suites Walnut Creek (1) Walnut Creek, CA Disposition December 4, 2023 Marriott Bridgewater (1) Bridgewater, NJ Disposition December 4, 2023 Marriott Research Triangle Park (1) Durham, NC Disposition December 4, 2023 W Atlanta (1) Atlanta, GA Disposition December 4, 2023 Courtyard Columbus Tipton Lakes (2) Columbus, IN Derecognized March 1, 2024 Courtyard Old Town (2) Scottsdale, AZ Derecognized March 1, 2024 Residence Inn Hughes Center (2) Las Vegas, NV Derecognized March 1, 2024 Residence Inn Phoenix Airport (2) Phoenix, AZ Derecognized March 1, 2024 Residence Inn San Jose Newark (2) Newark, CA Derecognized March 1, 2024 SpringHill Suites Manhattan Beach (2) Hawthorne, CA Derecognized March 1, 2024 SpringHill Suites Plymouth Meeting (2) Plymouth Meeting, PA Derecognized March 1, 2024 Courtyard Basking Ridge (2) Basking Ridge, NJ Derecognized March 1, 2024 Courtyard Newark Silicon Valley (2) Newark, CA Derecognized March 1, 2024 Courtyard Oakland Airport (2) Oakland, CA Derecognized March 1, 2024 Courtyard Plano Legacy Park (2) Plano, TX Derecognized March 1, 2024 Residence Inn Plano (2) Plano, TX Derecognized March 1, 2024 SpringHill Suites BWI Airport (2) Baltimore, MD Derecognized March 1, 2024 TownePlace Suites Manhattan Beach (2) Hawthorne, CA Derecognized March 1, 2024 Residence Inn Salt Lake City (1) Salt Lake City, UT Disposition March 6, 2024 Hilton Boston Back Bay (1) Boston, MA Disposition April 9, 2024 Hampton Inn Lawrenceville (1) Lawrenceville, GA Disposition April 23, 2024 Courtyard Manchester (1) Manchester, CT Disposition May 30, 2024 SpringHill Suites Kennesaw (1) Kennesaw, GA Disposition June 10, 2024 Fairfield Inn Kennesaw (1) Kennesaw, GA Disposition June 10, 2024 One Ocean (1) Atlantic Beach, FL Disposition June 27, 2024 The Ashton (1) Fort Worth, TX Disposition July 17, 2024 Le Meridien Fort Worth Fort Worth, TX Developed August 29, 2024 ____________________________________ (1) Referred to as “Hotel Dispositions” (2) Referred to as “KEYS A and B properties” The following table illustrates the key performance indicators of the operating hotel properties and WorldQuest included in our results of operations: Year Ended December 31, 2024 2023 RevPAR (revenue per available room) $ 132.87 $ 130.19 Occupancy 70.57 % 70.65 % ADR (average daily rate) $ 190.75 $ 184.47 55 The following table illustrates the key performance indicators of the 68 comparable hotel properties and four consolidated Stirling OP properties that were included in our results of operations for the full year ended December 31, 2024 and 2023, respectively: Year Ended December 31, 2024 2023 RevPAR $ 133.84 $ 133.27 Occupancy 69.93 % 70.82 % ADR $ 191.39 $ 188.18 Comparison of the Year Ended December 31, 2024 and 2023 Net Income (Loss) Attributable to the Company.
The following transactions affect the reporting comparability of our consolidated financial statements: Hotel Properties Location Type Date Courtyard Columbus Tipton Lakes (2) Columbus, IN Derecognized March 1, 2024 Courtyard Old Town (2) Scottsdale, AZ Derecognized March 1, 2024 Residence Inn Hughes Center (2) Las Vegas, NV Derecognized March 1, 2024 Residence Inn Phoenix Airport (2) Phoenix, AZ Derecognized March 1, 2024 Residence Inn San Jose Newark (2) Newark, CA Derecognized March 1, 2024 SpringHill Suites Manhattan Beach (2) Hawthorne, CA Derecognized March 1, 2024 SpringHill Suites Plymouth Meeting (2) Plymouth Meeting, PA Derecognized March 1, 2024 Courtyard Basking Ridge (2) Basking Ridge, NJ Derecognized March 1, 2024 Courtyard Newark Silicon Valley (2) Newark, CA Derecognized March 1, 2024 Courtyard Oakland Airport (2) Oakland, CA Derecognized March 1, 2024 Courtyard Plano Legacy Park (2) Plano, TX Derecognized March 1, 2024 Residence Inn Plano (2) Plano, TX Derecognized March 1, 2024 SpringHill Suites BWI Airport (2) Baltimore, MD Derecognized March 1, 2024 TownePlace Suites Manhattan Beach (2) Hawthorne, CA Derecognized March 1, 2024 Residence Inn Salt Lake City (1) Salt Lake City, UT Disposition March 6, 2024 Hilton Boston Back Bay (1) Boston, MA Disposition April 9, 2024 Hampton Inn Lawrenceville (1) Lawrenceville, GA Disposition April 23, 2024 Courtyard Manchester (1) Manchester, CT Disposition May 30, 2024 SpringHill Suites Kennesaw (1) Kennesaw, GA Disposition June 10, 2024 Fairfield Inn Kennesaw (1) Kennesaw, GA Disposition June 10, 2024 One Ocean (1) Atlantic Beach, FL Disposition June 27, 2024 The Ashton (1) Fort Worth, TX Disposition July 16, 2024 Le Méridien Fort Worth Fort Worth, TX Developed August 29, 2024 Courtyard Boston (1) Boston, MA Disposition January 10, 2025 Residence Inn Evansville (1) Evansville, IN Disposition August 11, 2025 Hilton NASA Clear Lake (1) Houston, TX Disposition August 22, 2025 Residence Inn San Diego (1) San Diego, CA Disposition October 15, 2025 Le Pavillon (1) New Orleans, LA Disposition December 18, 2025 ____________________________________ (1) Referred to as “Hotel Dispositions.” (2) Referred to as “KEYS A and B properties.” The following table illustrates the key performance indicators of the operating hotel properties included in our results of operations: Year Ended December 31, 2025 2024 RevPAR (revenue per available room) $ 131.68 $ 132.87 Occupancy 70.26 % 69.66 % ADR (average daily rate) $ 187.41 $ 190.75 58 The following table illustrates the key performance indicators of the 67 comparable hotel properties that were included in our results of operations for the full years ended December 31, 2025 and 2024, respectively: Year Ended December 31, 2025 2024 RevPAR $ 132.61 $ 134.02 Occupancy 69.50 % 71.13 % ADR $ 190.82 $ 188.40 Comparison of the Year Ended December 31, 2025 and 2024 Net Income (Loss) Attributable to the Company .
The KEYS Pool A and the KEYS Pool B mortgage loans as well as all accrued and unpaid interest, default charges and late fees will remain liabilities until final resolution with the lenders is concluded, and thus are included in “indebtedness associated with hotels in receivership” and “accrued interest associated with hotels in receivership” on our consolidated balance sheets.
The KEYS Pool A and the KEYS Pool B mortgage loans, as well as all accrued and unpaid interest, default charges and late fees will remain liabilities until final resolution with the lenders is concluded.
To the extent that it is consistent with maintaining our REIT status, we may maintain accumulated earnings of Ashford TRS in that entity. On December 10, 2024, our board of directors reviewed and approved our 2025 dividend policy.
To the extent that it is consistent with maintaining our REIT status, we may maintain accumulated earnings of Ashford TRS in that entity. On December 15, 2025, our board of directors reviewed and approved our 2026 dividend policy. We do not anticipate paying any dividends on our outstanding common stock for any quarter during 2026.
In 2024, we recognized an unrealized loss of $27.1 million associated with interest rate caps, an unrealized loss of $320,000 associated with interest rate floors and an unrealized loss of $5.4 million from the revaluation of the embedded debt derivative in the Oaktree Agreement partially offset by a realized gain of $26.3 million related to payments from counterparties on interest rate caps.
These unrealized losses were partially offset by net realized gains on interest rate caps of $1.2 million. In 2024, we recognized an unrealized loss of $27.4 million associated with interest rate caps and an unrealized loss of $5.4 million from the revaluation of the embedded debt derivative in the Oaktree Agreement.
Other revenue decreased $476,000, or 17.0%, to $2.3 million in 2024 compared to 2023. Hotel Operating Expenses. Hotel operating expenses decreased $110.1 million, or 11.9%, to $815.4 million in 2024 compared to 2023. Hotel operating expenses consist of direct expenses from departments associated with revenue streams and indirect expenses associated with support departments and management fees.
Other revenue decreased $791,000, or 34.0%, to $1.5 million in 2025 compared to 2024. Hotel Operating Expenses . Hotel operating expenses decreased $47.1 million, or 5.8%, to $768.3 million in 2025 compared to 2024. Hotel operating expenses consist of direct expenses from departments associated with revenue streams and indirect expenses associated with support departments and management fees.
We have entered into certain customary guaranty agreements pursuant to which we guaranty payment of any recourse liabilities of our subsidiaries or joint ventures that may result from non-recourse carve-outs, which include, but are not limited to, fraud, misrepresentation, willful misconduct resulting in waste, misappropriations of rents following an event of default, voluntary bankruptcy filings, unpermitted transfers of collateral, delinquency of trade payables and certain environmental liabilities.
Thus, even if our total market capitalization and performance decline, we will still be required to make payments to our advisor equal to the minimum base management fee, which could adversely impact our liquidity and financial condition. 62 We have entered into certain customary guaranty agreements pursuant to which we guarantee payment of any recourse liabilities of our subsidiaries or joint ventures that may result from non-recourse carve-outs, which include, but are not limited to, fraud, misrepresentation, willful misconduct resulting in waste, misappropriation of rents following an event of default, voluntary bankruptcy filings, unpermitted transfers of collateral, delinquency of trade payables and certain environmental liabilities.
Subsequent to March 31, 2024, we recognized an additional gain of $33.3 million, which is included in “gain (loss) on derecognition of assets” in our consolidated statement of operations that increased the contract asset by a corresponding amount. The additional gain primarily represents the additional accrued interest expense recorded through December 31, 2024.
Subsequent to March 31, 2024, we recognized an additional gain of $33.3 million that increased the contract asset by a corresponding amount. The additional gain primarily represents the additional accrued interest expense recorded through December 31, 2024. In total for the year ended December 31, 2024, we recognized a gain of $167.2 million.
On February 7, 2025, we filed our prospectus for the offering with the SEC. Ashford Securities, a subsidiary of Ashford Inc., serves as the dealer manager for the offering. As of March 19, 2025, no shares of Series L Preferred Stock or Series M Preferred Stock have been issued.
On February 7, 2025, we filed our prospectus for the offering with the SEC. Ashford Securities, a subsidiary of Ashford Inc., serves as the dealer manager for the offering. On December 9, 2025, the Company terminated the primary offering of the Company’s Series L Redeemable Preferred Stock and Series M Redeemable Preferred Stock.
Items that impacted our cash flow and liquidity during the periods indicated are summarized as follows: Net Cash Flows Provided by (Used in) Operating Activities.
Items that impacted our cash flow and liquidity during the periods indicated are summarized as follows: Net Cash Flows Provided by (Used in) Operating Activities . Net cash flows used in operating activities were $15.7 million and $23.6 million for the years ended December 31, 2025 and 2024, respectively.
Our noncontrolling interest partners in consolidated entities were allocated a loss of $6,000 in 2023. At December 31, 2024, noncontrolling interests in consolidated entities represented an ownership interest of 70.7% in 815 Commerce MM and 1.20% in Stirling OP. See note 2 to our consolidated financial statements. Net (Income) Loss Attributable to Redeemable Noncontrolling Interests in Operating Partnership.
Noncontrolling interests in consolidated entities represented an ownership interest of 70.7% in 815 Commerce MM and, prior to September 2, 2025, 0.30% in Stirling OP. See notes 1 and 2 to our consolidated financial statements. Net (Income) Loss Attributable to Redeemable Noncontrolling Interests in Operating Partnership .
EXECUTIVE OVERVIEW General As of December 31, 2024, our portfolio consisted of 68 consolidated operating hotel properties, which represent 17,051 total rooms. One consolidated operating hotel property, which represents 188 total rooms is owned through a 29.3% investment in a consolidated entity.
EXECUTIVE OVERVIEW General As of December 31, 2025, our portfolio consisted of 67 consolidated operating hotel properties, which represent 16,445 total rooms, and one additional consolidated operating hotel property owned through a 29.3% investment in a consolidated entity, which represents 188 total rooms. Currently, all of our hotel properties are located in the United States.
Occupancy, ADR and RevPAR are commonly used measures within the lodging industry to evaluate operating performance. RevPAR is an important statistic for monitoring operating performance at the individual hotel level and across our entire business.
Changes in ADR typically have a greater impact on operating margins and profitability as they do not have a substantial effect on variable operating costs. Occupancy, ADR and RevPAR are commonly used measures within the lodging industry to evaluate operating performance. RevPAR is an important statistic for monitoring operating performance at the individual hotel level and across our entire business.
We may incur indebtedness to meet distribution requirements imposed on REITs under the Code to the extent that working capital and cash flow from our investments are insufficient to fund required distributions. We may pay dividends in excess of our cash flow.
We may incur indebtedness to meet distribution requirements imposed on REITs under the Code to the extent that working capital and cash flow from our investments are insufficient to fund required distributions. INFLATION We rely entirely on the performance of our hotel properties and the ability of the hotel properties’ managers to increase revenues to keep pace with inflation.
Certain of our loan agreements contain cash trap provisions that may be triggered if the performance of our hotels declines below a threshold. When these provisions are triggered, substantially all of the profit generated by our hotels is deposited directly into lockbox accounts and then swept into cash management accounts for the benefit of our various lenders.
When these provisions are triggered, substantially all of the profit generated by our hotels is deposited directly into lockbox accounts and then swept into cash management accounts for the benefit of our various lenders. During a cash trap, certain disbursements from these hotel operating cash receipts would require consent of our lenders.
The Company and the lender agreed to a deed-in-lieu of foreclosure, which was completed on July 16, 2024 and resulted in a gain on extinguishment of debt of approximately $2.6 million. Gain on extinguishment of debt also included $45,000 in 2024 primarily related to the deed in lieu of foreclosure transaction for the KEYS Pool F mortgage loan.
The Company and the lender agreed to a deed-in-lieu of foreclosure, which was completed on July 16, 2024 and resulted in a gain on extinguishment of debt of approximately $2.6 million. Realized and Unrealized Gain (Loss) on Derivatives .
On May 5, 2022, we filed our prospectus for the offering with the SEC. Ashford Securities, a subsidiary of Ashford Inc., serves as the dealer manager for the offering.
On May 5, 2022, we filed our prospectus for the offering with the SEC. On March 31, 2025, the Company concluded its offering of its Series J Preferred Stock and Series K Preferred Stock. Ashford Securities, a subsidiary of Ashford Inc., served as the dealer manager for the offering.
Utilization of the REIT NOLs subject to Section 382 are limited to approximately $37.2 million per year through 2025, and $9.4 million per year thereafter. $424.6 million of our net operating loss carryforwards will begin to expire in 2029 and are 65 available to offset future taxable income, if any, through 2036.
The majority of our REIT NOLs are subject to limitation on their use under Section 382. $424.0 million of our net operating loss carryforwards will begin to expire in 2029 and are available to offset future taxable income, if any, through 2036.
Historically, periods of declining demand are followed by extended periods of relatively strong demand, which typically occurs during the growth phase of the lodging cycle. Supply —The development of new hotels is driven largely by construction costs, the availability of financing and expected performance of existing hotels. Short-term supply is also expected to be below long-term averages.
Supply —The development of new hotels is driven largely by construction costs, the availability of financing and expected performance of existing hotels. Short-term supply is also expected to be below long-term averages.
Interest expense and amortization of discounts and loan costs decreased $53.6 million, or 16.4%, to $273.4 million in 2024 compared to 2023.
Interest expense and amortization of discounts and loan costs decreased $17.1 million, or 6.3%, to $256.2 million in 2025 compared to 2024.
Subsequent to March 31, 2024, we recognized an additional gain of $33.3 million, which is included in “gain (loss) on derecognition of assets” in our consolidated statement of operations that increased the contract asset by a corresponding amount. The additional gain primarily represents the additional accrued interest expense recorded through December 31, 2024.
For the year ended December 31, 2025, we recognized an additional gain of $39.1 million, which was included in “gain (loss) on derecognition of assets” in our consolidated statement of operations that increased the contract asset by a corresponding amount.
Further, interest rates can greatly affect the cost of our debt service as well as the value of any financial hedges we may put in place. We monitor industry fundamentals and interest rates very closely. Capital expenditures above our reserves will affect cash flow as well and are impacted by inflation.
Our cash position from operations is affected primarily by macro industry movements in occupancy and rates as well as our ability to control costs. Further, interest rates can greatly affect the cost of our debt service as well as the value of any financial hedges we may put in place. We monitor industry fundamentals and interest rates very closely.
Our general and administrative costs, real estate and personal property taxes, property and casualty insurance, labor costs and utilities are subject to inflation as well. CRITICAL ACCOUNTING POLICIES AND ESTIMATES Our significant accounting policies are fully described in note 2 to our consolidated financial statements included in Item 8. Financial Statements and Supplementary Data.
CRITICAL ACCOUNTING POLICIES AND ESTIMATES Our significant accounting policies are fully described in note 2 to our consolidated financial statements included in Item 8. Financial Statements and Supplementary Data.
In 2024, the advisory services fee was comprised of a base advisory fee of $32.5 million, equity-based compensation of $1.8 million associated with equity grants of our common stock, PSUs, LTIP units and Performance LTIP units awarded to the officers and employees of Ashford Inc., reimbursable expenses of $23.9 million and a performance participation fee of $454,000 associated with the Stirling OP advisory agreement with Ashford Inc.
In 2024, the advisory services fee comprised a base advisory fee of $32.0 million, equity-based compensation of $1.8 million awarded to the officers and employees of Ashford Inc., reimbursable expenses of $23.7 million and fees totaling $1.1 million associated with Stirling OP’s advisory agreement. Corporate, General and Administrative .
For example, an increase in occupancy at a hotel would lead to additional variable operating costs (including housekeeping services, utilities and room supplies) and could also result in increased other operating department revenue and expense. Changes in ADR typically have a greater impact on operating margins and profitability as they do not have a substantial effect on variable operating costs.
For example, an increase in occupancy at a hotel would lead to additional variable operating costs (including housekeeping services, utilities and room supplies) and could also result in increases in other operating department revenues and expenses.
As a result the contract asset and corresponding indebtedness associated with hotels in receivership and accrued interest associated with hotels in receivership were reduced for the amounts attributable to each hotel. On March 6, 2024, the Company completed the sale of the Residence Inn in Salt Lake City, Utah for approximately $19.2 million.
As a result, the contract asset and corresponding indebtedness associated with hotels in receivership and accrued interest associated with hotels in receivership were reduced for the amounts attributable to each hotel.
Cash inflows consisted of $300.0 million of net proceeds from the disposition of assets and hotel properties, repayments of a note receivable of $2.5 million and $1.5 million from property insurance proceeds, partially offset by cash outflows of $108.0 million for capital improvements made to various hotel properties and $4.5 million from the issuance of a note receivable.
Cash inflows were partially offset by cash outflows of $108.0 million for capital improvements made to various hotel properties and $4.5 million from the issuance of a note receivable. Net Cash Flows Provided by (Used in) Financing Activities . For the year ended December 31, 2025, net cash flows used in financing activities were $179.2 million.
Equity in loss of unconsolidated entities was $2.4 million in 2024, which consisted of equity in loss of $566,000 million from OpenKey, $795,000 from an investment in an entity that owns the Meritage Resort and Spa and the Grand Reserve at the Meritage in Napa, California and a $1.0 million impairment charge on OpenKey.
Equity in loss of unconsolidated entities was $325,000 in 2025 and $2.4 million in 2024. Equity in loss primarily results from our investment in an entity that owns the Meritage Resort and Spa and the Grand Reserve at the Meritage in Napa, California. Interest Income . Interest income was $4.7 million and $6.9 million in 2025 and 2024, respectively.
This decrease is attributable to $111.0 million from our Hotel Dispositions, $69.5 million from the KEYS A and B properties that went into receivership partially offset by higher rooms revenue of $8.4 million at our comparable hotel properties, $509,000 from the Stirling hotel properties and $2.2 million from the Le Meridien that opened in August 2024.
This decrease in 2025 is primarily attributable to decreases in rooms revenue of $48.5 million from our Hotel Dispositions, $13.7 million from the KEYS A and B properties that went into receivership in 2024 and $8.6 million at our comparable hotel properties.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeAt December 31, 2024, our total indebtedness of $2.7 billion included $2.5 billion of variable-rate debt. The impact on our results of operations of a 25-basis point change in interest rate on the outstanding balance of variable-rate debt at December 31, 2024 would be approximately $6.4 million per year.
Biggest changeAs of December 31, 2025, our total indebtedness of $2.6 billion included $2.4 billion of variable-rate debt. The impact on our results of operations of a 25-basis point change in interest rate on the outstanding balance of variable-rate debt at December 31, 2025, would be approximately $6.1 million per year.
As a result, the ultimate realized gain or loss with respect to interest rate fluctuations will depend on exposures that arise during the period, the hedging strategies in place at the time, and the related interest rates. 70
As a result, the ultimate realized gain or loss with respect to interest rate fluctuations will depend on exposures that arise during the period, the hedging strategies in place at the time, and the related interest rates. 73
However, we currently have various interest rate caps in place that limit this exposure. Interest rate changes have no impact on the remaining $159.6 million of fixed-rate debt. The above amounts were determined based on the impact of hypothetical interest rates on our borrowings and assume no changes in our capital structure.
However, we currently have various interest rate caps in place that limit this exposure. Interest rate changes have no impact on the remaining $156.7 million of fixed-rate debt. The above amounts were determined based on the impact of hypothetical interest rates on our borrowings and assume no changes in our capital structure.
As the information presented above includes only those exposures that existed at December 31, 2024, it does not consider exposures or positions that could arise after that date. Accordingly, the information presented herein has limited predictive value.
As the information presented above includes only those exposures that existed as of December 31, 2025, it does not consider exposures or positions that could arise after that date. Accordingly, the information presented herein has limited predictive value.

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