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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

____________________________________________________________________________________

FORM 10-Q

____________________________________________________________________________________


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

For the quarterly period ended June 30, 2025


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

For the transition period from to

Commission File Number: 001-35074

SUMMIT HOTEL PROPERTIES, INC.

(Exact name of registrant as specified in its charter)

_____________________________________________________________________________________


Maryland						27-2962512
(State or other jurisdiction						(I.R.S. Employer Identification No.)
of incorporation or organization)

13215 Bee Cave Parkway, Suite B-300

Austin, TX 78738

(Address of principal executive offices, including zip code)

(512) 538-2300

(Registrant’s telephone number, including area code)

________________________________________________________________________________

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, $0.01 par value

INN

New York Stock Exchange

Series E Cumulative Redeemable Preferred Stock, $0.01 par value

INN-PE

New York Stock Exchange

Series F Cumulative Redeemable Preferred Stock, $0.01 par value

INN-PF

New York Stock Exchange

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

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

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


Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.			☐

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

As of July 25, 2025, the number of outstanding shares of common stock of Summit Hotel Properties, Inc. was 108,808,785.

TABLE OF CONTENTS


		Page
PART I — FINANCIAL INFORMATION

Item 1.	Financial Statements

	Condensed Consolidated Balance Sheets — June 30, 2025 (Unaudited) and December 31, 2024	1
	Condensed Consolidated Statements of Operations (Unaudited) — Three and Six Months Ended June 30, 2025 and 2024	2
	Condensed Consolidated Statements of Comprehensive (Loss) Income (Unaudited) — Three and Six Months Ended June 30, 2025 and 2024	3
	Condensed Consolidated Statements of Changes in Equity and Redeemable Non-controlling Interests (Unaudited) — Three and Six Months Ended June 30, 2025 and 2024	4
	Condensed Consolidated Statements of Cash Flows (Unaudited) — Six Months Ended June 30, 2025 and 2024	6
	Notes to the Condensed Consolidated Financial Statements (Unaudited)	7

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	33

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	53

Item 4.	Controls and Procedures	54

PART II — OTHER INFORMATION

Item 1.	Legal Proceedings	55

Item 1A.	Risk Factors	55

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	55

Item 3.	Defaults Upon Senior Securities	56

Item 4.	Mine Safety Disclosures	56

Item 5.	Other Information	56

Item 6.	Exhibits	57

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

Summit Hotel Properties, Inc.

Condensed Consolidated Balance Sheets

(In thousands, except share amounts)


	June 30, 2025		December 31, 2024
	(Unaudited)
ASSETS
Investments in lodging property, net	$	2,722,459	$	2,746,765
Investment in lodging property under development	—		7,617

Assets held for sale, net	—		1,225

Cash and cash equivalents	39,490		40,637
Restricted cash	8,734		7,721
Right-of-use assets, net	32,933		33,309
Trade receivables, net	22,554		18,625
Prepaid expenses and other	14,197		9,580

Deferred charges, net	10,468		6,460

Other assets	17,335		24,291
Total assets	$	2,868,170	$	2,896,230

LIABILITIES, REDEEMABLE NON-CONTROLLING INTERESTS AND EQUITY
Liabilities:
Debt, net of debt issuance costs	$	1,425,799	$	1,396,710
Lease liabilities, net	24,763		24,871
Accounts payable	7,285		7,450
Accrued expenses and other	81,142		82,153

Total liabilities	1,538,989		1,511,184

Commitments and contingencies (Note 11)	—		—

Redeemable non-controlling interests	50,219		50,219
Equity:
Preferred stock, $0.01 par value per share, 100,000,000 shares authorized:


6.25% Series E - 6,400,000 shares issued and outstanding at June 30, 2025 and December 31, 2024 (aggregate liquidation preference of $160,861 at June 30, 2025 and December 31, 2024, respectively)	64		64
5.875% Series F - 4,000,000 shares issued and outstanding at June 30, 2025 and December 31, 2024 (aggregate liquidation preference of $100,506 at June 30, 2025 and December 31, 2024, respectively)	40		40
Common stock, $0.01 par value per share, 500,000,000 shares authorized, 108,811,508 and 108,435,663 shares issued and outstanding at June 30, 2025 and December 31, 2024, respectively	1,088		1,084
Additional paid-in capital	1,260,433		1,246,225
Accumulated other comprehensive income	4,400		9,173
Accumulated deficit and distributions in excess of retained earnings	(370,879)		(347,041)
Total stockholders’ equity	895,146		909,545


Non-controlling interests	383,816		425,282
Total equity	1,278,962		1,334,827
Total liabilities, redeemable non-controlling interests and equity	$	2,868,170	$	2,896,230

See Notes to the Condensed Consolidated Financial Statements

Summit Hotel Properties, Inc.

Condensed Consolidated Statements of Operations

(Unaudited)

(In thousands, except per share amounts)


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Revenues:
Room	$	170,599	$	173,025	$	334,330	$	340,456
Food and beverage	11,195		10,069		22,185		20,902
Other	11,123		10,809		20,880		20,687
Total revenues	192,917		193,903		377,395		382,045

Expenses:
Room	39,166		38,044		75,298		74,017
Food and beverage	8,388		7,639		16,379		15,841
Other lodging property operating expenses	58,943		57,470		115,865		113,731
Property taxes, insurance and other	13,706		13,287		27,017		27,572
Management fees	4,411		4,434		8,906		9,331
Depreciation and amortization	37,259		36,458		74,489		73,257
Corporate general and administrative	8,280		8,704		16,851		17,015




Total expenses	170,153		166,036		334,805		330,764
(Loss) gain on disposal of assets, net	(80)		28,342		(79)		28,417

Operating income	22,684		56,209		42,511		79,698

Other income (expense):
Interest expense	(20,628)		(20,830)		(40,584)		(42,412)
Interest income	301		565		577		1,023

Gain on extinguishment of debt	—		3,000		—		3,000
Other income, net	858		2,129		2,088		2,814
Total other expense, net	(19,469)		(15,136)		(37,919)		(35,575)
Income from continuing operations before income taxes	3,215		41,073		4,592		44,123
Income tax expense (Note 13)	(1,178)		(2,375)		(1,932)		(2,592)
Net income	2,037		38,698		2,660		41,531
Less - (Loss) income attributable to non-controlling interests	(976)		3,224		(296)		3,546


Net income attributable to Summit Hotel Properties, Inc. before preferred dividends	3,013		35,474		2,956		37,985
Less - Distributions to and accretion of redeemable non-controlling interests	(657)		(657)		(1,314)		(1,314)
Less - Preferred dividends	(3,968)		(3,968)		(7,938)		(7,938)

Net (loss) income attributable to common stockholders	$	(1,612)	$	30,849	$	(6,296)	$	28,733

(Loss) income per common share:
Basic	$	(0.02)	$	0.29	$	(0.06)	$	0.27
Diluted	$	(0.02)	$	0.23	$	(0.06)	$	0.21
Weighted-average common shares outstanding:
Basic	107,633		105,918		107,820		105,819
Diluted	107,633		149,451		107,820		149,112

See Notes to the Condensed Consolidated Financial Statements

Summit Hotel Properties, Inc.

Condensed Consolidated Statements of Comprehensive (Loss) Income

(Unaudited)

(In thousands)


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Net income	$	2,037	$	38,698	$	2,660	$	41,531
Other comprehensive (loss) income, net of tax:
Changes in fair value of derivative financial instruments	(2,418)		(563)		(6,085)		5,133
Comprehensive (loss) income	(381)		38,135		(3,425)		46,664


Comprehensive loss (income) attributable to non-controlling interests	1,341		(3,198)		1,349		(5,214)
Comprehensive income (loss) attributable to Summit Hotel Properties, Inc.	960		34,937		(2,076)		41,450
Distributions to and accretion on redeemable non-controlling interests	(657)		(657)		(1,314)		(1,314)
Preferred dividends and distributions	(3,968)		(3,968)		(7,938)		(7,938)

Comprehensive (loss) income attributable to common stockholders	$	(3,665)	$	30,312	$	(11,328)	$	32,198

See Notes to the Condensed Consolidated Financial Statements

Summit Hotel Properties, Inc.

Condensed Consolidated Statements of Changes in Equity and Redeemable Non-controlling Interests

For the Three Months Ended June 30, 2025 and 2024

(Unaudited)

(In thousands, except share amounts)


	Redeemable Non-controlling Interests		Shares of Preferred Stock	Preferred Stock		Shares of Common Stock	Common Stock		Additional Paid-In Capital		Accumulated Comprehensive Income (Loss)		Accumulated Deficit and Distributions		Stockholders’ Equity		Non-controlling Interests		Total Equity
Balance at March 31, 2025	$	50,219	10,400,000	$	104	112,221,768	$	1,122	$	1,273,164	$	6,453	$	(360,404)	$	920,439	$	397,179	$	1,317,618

Adjustment of redeemable non-controlling interests to redemption value	657		—	—		—	—		—		—		(657)		(657)		—		(657)


Contributions by non-controlling interest in joint venture	—		—	—		—	—		—		—		—		—		343		343
Repurchase of common shares	—		—	—		(3,585,179)	(36)		(15,366)		—		—		(15,402)		—		(15,402)


Dividends and distributions on common stock and common units	—		—	—		—	—		—		—		(8,863)		(8,863)		(1,041)		(9,904)
Preferred dividends and distributions	(657)		—	—		—	—		—		—		(3,968)		(3,968)		(150)		(4,118)

Joint venture partner distributions	—		—	—		—	—		—		—		—		—		(11,174)		(11,174)
Equity-based compensation	—		—	—		175,154	2		2,787		—		—		2,789		—		2,789
Shares of common stock acquired for employee withholding requirements	—		—	—		(235)	—		—		—		—		—		—		—
Other	—		—	—		—	—		(152)		—		—		(152)		—		(152)
Other comprehensive loss	—		—	—		—	—		—		(2,053)		—		(2,053)		(365)		(2,418)
Net income (loss)	—		—	—		—	—		—		—		3,013		3,013		(976)		2,037
Balance at June 30, 2025	$	50,219	10,400,000	$	104	108,811,508	$	1,088	$	1,260,433	$	4,400	$	(370,879)	$	895,146	$	383,816	$	1,278,962

Balance at March 31, 2024	$	50,219	10,400,000	$	104	108,198,141	$	1,082	$	1,239,905	$	14,969	$	(348,302)	$	907,758	$	436,418	$	1,344,176

Adjustment of redeemable non-controlling interests to redemption value	657		—	—		—	—		—		—		(657)		(657)		—		(657)



Contributions by non-controlling interest in joint venture	—		—	—		—	—		—		—		—		—		146		146
Common stock redemption of common units	—		—	—		310	—		3		—		—		3		(3)		—

Dividends and distributions on common stock and common units	—		—	—		—	—		—		—		(8,655)		(8,655)		(1,276)		(9,931)
Preferred dividends and distributions	(657)		—	—		—	—		—		—		(3,968)		(3,968)		(150)		(4,118)
Joint venture partner distributions	—		—	—		—	—		—		—		—		—		(10,963)		(10,963)
Equity-based compensation	—		—	—		95,600	1		2,634		—		—		2,635		—		2,635
Shares of common stock acquired for employee withholding requirements	—		—	—		(17,808)	—		(106)		—		—		(106)		—		(106)

Other comprehensive loss	—		—	—		—	—		—		(537)		—		(537)		(26)		(563)
Net income	—		—	—		—	—		—		—		35,474		35,474		3,224		38,698
Balance at June 30, 2024	$	50,219	10,400,000	$	104	108,276,243	$	1,083	$	1,242,436	$	14,432	$	(326,108)	$	931,947	$	427,370	$	1,359,317

See Notes to the Condensed Consolidated Financial Statements

Summit Hotel Properties, Inc.

Condensed Consolidated Statements of Changes in Equity and Redeemable Non-controlling Interests

For the Six Months Ended June 30, 2025 and 2024

(Unaudited)

(In thousands, except share amounts)


	Redeemable Non-controlling Interests		Shares of Preferred Stock	Preferred Stock		Shares of Common Stock	Common Stock		Additional Paid-In Capital		Accumulated Comprehensive Income (Loss)		Accumulated Deficit and Distributions		Stockholders’ Equity		Non-controlling Interests		Total Equity
Balance at December 31, 2024	$	50,219	10,400,000	$	104	108,435,663	$	1,084	$	1,246,225	$	9,173	$	(347,041)	$	909,545	$	425,282	$	1,334,827

Adjustment of redeemable non-controlling interests to redemption value	1,314		—	—		—	—		—		—		(1,314)		(1,314)		—		(1,314)


Contributions by non-controlling interest in joint venture	—		—	—		—	—		—		—		—		—		754		754
Repurchase of common shares	—		—	—		(3,585,179)	(36)		(15,366)		—		—		(15,402)		—		(15,402)
Common stock redemption of common units	—		—	—		2,923,797	29		26,618		259		—		26,906		(26,906)		—

Dividends and distributions on common stock and common units	—		—	—		—	—		—		—		(17,542)		(17,542)		(2,210)		(19,752)
Preferred dividends and distributions	(1,314)		—	—		—	—		—		—		(7,938)		(7,938)		(150)		(8,088)

Joint venture partner distributions	—		—	—		—	—		—		—		—		—		(11,605)		(11,605)
Equity-based compensation	—		—	—		1,276,610	13		4,692		—		—		4,705		—		4,705
Shares of common stock acquired for employee withholding requirements	—		—	—		(239,383)	(2)		(1,584)		—		—		(1,586)		—		(1,586)
Other	—		—	—		—	—		(152)		—		—		(152)		—		(152)
Other comprehensive loss	—		—	—		—	—		—		(5,032)		—		(5,032)		(1,053)		(6,085)
Net income (loss)	—		—	—		—	—		—		—		2,956		2,956		(296)		2,660
Balance at June 30, 2025	$	50,219	10,400,000	$	104	108,811,508	$	1,088	$	1,260,433	$	4,400	$	(370,879)	$	895,146	$	383,816	$	1,278,962

Balance at December 31, 2023	$	50,219	10,400,000	$	104	107,593,373	$	1,076	$	1,238,896	$	10,967	$	(339,848)	$	911,195	$	435,282	$	1,346,477

Adjustment of redeemable non-controlling interests to redemption value	1,314		—	—		—	—		—		—		(1,314)		(1,314)		—		(1,314)



Contributions by non-controlling interest in joint venture	—		—	—		—	—		—		—		—		—		222		222
Common stock redemption of common units	—		—	—		310	—		3		—		—		3		(3)		—

Dividends and distributions on common stock and common units	—		—	—		—	—		—		—		(14,993)		(14,993)		(2,232)		(17,225)
Preferred dividends and distributions	(1,314)		—	—		—	—		—		—		(7,938)		(7,938)		(150)		(8,088)
Joint venture partner distributions	—		—	—		—	—		—		—		—		—		(10,963)		(10,963)
Equity-based compensation	—		—	—		827,214	8		4,475		—		—		4,483		—		4,483
Shares of common stock acquired for employee withholding requirements	—		—	—		(144,654)	(1)		(938)		—		—		(939)		—		(939)
Other comprehensive income	—		—	—		—	—		—		3,465		—		3,465		1,668		5,133

Net income	—		—	—		—	—		—		—		37,985		37,985		3,546		41,531
Balance at June 30, 2024	$	50,219	10,400,000	$	104	108,276,243	$	1,083	$	1,242,436	$	14,432	$	(326,108)	$	931,947	$	427,370	$	1,359,317

See Notes to the Condensed Consolidated Financial Statements

Summit Hotel Properties, Inc.

Condensed Consolidated Statements Cash Flows

(Unaudited)

(In thousands)





	Six Months Ended June 30,
	2025		2024
OPERATING ACTIVITIES
Net income	$	2,660	$	41,531
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	74,489		73,257
Amortization of debt issuance costs	3,350		3,240


Equity-based compensation	4,705		4,483
Deferred tax expense	1,168		—

Loss (gain) on disposal of assets, net	79		(28,417)
Gain on extinguishment of debt	—		(3,000)
Non-cash interest income	—		(266)
Debt transaction costs	15		581
Other	445		6
Changes in operating assets and liabilities:

Trade receivables, net	(4,054)		(6,619)
Prepaid expenses and other	(4,669)		(5,255)
Accounts payable	(1,441)		(63)
Accrued expenses and other	(2,061)		(1,003)
NET CASH PROVIDED BY OPERATING ACTIVITIES	74,686		78,475
INVESTING ACTIVITIES

Improvements to lodging properties	(34,570)		(39,007)
Investment in lodging property under development	(5,647)		(2,503)


Proceeds from asset dispositions, net	1,243		92,168




Other	(128)		—
NET CASH (USED IN) PROVIDED BY INVESTING ACTIVITIES	(39,102)		50,658
FINANCING ACTIVITIES
Proceeds from borrowings on revolving line of credit	55,000		90,000
Repayments of revolving line of credit borrowings	(40,000)		(80,000)
Proceeds from mortgage loan	58,000		—
Principal payments on debt	(46,305)		(93,497)

Repurchases of common shares	(15,402)		—


Common dividends and distributions paid	(19,740)		(17,181)
Preferred dividends and distributions paid	(9,402)		(9,402)
Contributions by non-controlling interests in joint venture	754		221

Distributions to joint venture partners	(11,605)		(10,963)
Financing fees, debt transaction costs and other issuance costs	(5,432)		(2,501)
Repurchase of common stock for tax withholding requirements	(1,586)		(939)

NET CASH USED IN FINANCING ACTIVITIES	(35,718)		(124,262)
Net change in cash, cash equivalents and restricted cash	(134)		4,871

CASH, CASH EQUIVALENTS AND RESTRICTED CASH
Beginning of period	48,358		47,768
End of period	$	48,224	$	52,639

RECONCILIATION OF CASH, CASH EQUIVALENTS AND RESTRICTED CASH WITHIN THE CONDENSED CONSOLIDATED BALANCE SHEET TO THE AMOUNTS SHOWN IN THE STATEMENT OF CASH FLOWS ABOVE:
Cash and cash equivalents	$	39,490	$	45,873
Restricted cash	8,734		6,766
TOTAL CASH, CASH EQUIVALENTS AND RESTRICTED CASH	$	48,224	$	52,639

See Notes to the Condensed Consolidated Financial Statements

SUMMIT HOTEL PROPERTIES, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 1 - DESCRIPTION OF BUSINESS

General

Summit Hotel Properties, Inc. (the “Company”) is a self-managed lodging property investment company that was organized in June 2010 as a Maryland corporation. The Company holds both general and limited partnership interests in Summit Hotel OP, LP (the “Operating Partnership”), a Delaware limited partnership also organized in June 2010. Unless the context otherwise requires, “we,” “us,” and “our” refer to the Company and its consolidated subsidiaries.

We focus on owning lodging properties with efficient operating models that generate strong margins and investment returns. At June 30, 2025, our portfolio consisted of 97 lodging properties with a total of 14,577 guestrooms located in 25 states of the United States of America (“USA”). At June 30, 2025, we own 100% of the outstanding equity interests in 53 of the 97 lodging properties. We own a 51% controlling interest in 41 lodging properties through a joint venture that was formed in July 2019 with USFI G-Peak, Ltd. (“GIC”), a private limited company incorporated in the Republic of Singapore (the “GIC Joint Venture”). We also own 90% equity interests in two separate joint ventures (the “Brickell Joint Venture” and the “Onera Joint Venture”). The Brickell Joint Venture owns two lodging properties, and the Onera Joint Venture owns one lodging property.

At June 30, 2025, 86% of our guestrooms were located in the top 50 metropolitan statistical areas (“MSAs”), 91% were located within the top 100 MSAs, and over 99% of our guestrooms operate under premium franchise brands owned by Marriott® International, Inc. (“Marriott”), Hilton® Worldwide (“Hilton”), Hyatt® Hotels Corporation (“Hyatt”), and InterContinental® Hotels Group (“IHG”).

Substantially all of our assets are held by, and all of our operations are conducted through, the Operating Partnership. Through a wholly-owned subsidiary, we are the sole general partner of the Operating Partnership. At June 30, 2025, we owned, directly and indirectly, approximately 89% of the Operating Partnership’s issued and outstanding common units of limited partnership interest (“Common Units”), and all of the Operating Partnership’s issued and outstanding 6.25% Series E and 5.875% Series F preferred units of limited partnership interest. NewcrestImage (as defined in Note 5 - Debt to the Condensed Consolidated Financial Statements) owns all of the issued and outstanding 5.25% Series Z Cumulative Perpetual Preferred Units (liquidation preference $25 per unit) of the Operating Partnership (“Series Z Preferred Units”) as a result of the NCI Transaction (described in Note 5 - Debt to the Condensed Consolidated Financial Statements). We collectively refer to preferred units of limited partnership interests of our Operating Partnership as “Preferred Units.”

Pursuant to the Operating Partnership’s partnership agreement, we have full, exclusive and complete responsibility and discretion in the management and control of the Operating Partnership, including the ability to cause the Operating Partnership to enter into certain major transactions including acquisitions, dispositions, refinancings, to make distributions to partners, and to cause changes in the Operating Partnership’s business activities.

We have elected to be taxed as a real estate investment trust (“REIT”) for federal income tax purposes. To qualify as a REIT, we cannot operate or manage our lodging properties. Accordingly, all of our lodging properties are leased to our taxable REIT subsidiaries (“TRS Lessees” or “TRSs”) and managed by professional third-party lodging property management companies.

NOTE 2 - BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

We prepare our Condensed Consolidated Financial Statements in conformity with U.S. Generally Accepted Accounting Principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X under the Securities Exchange Act of 1934, as amended, which requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the Condensed Consolidated Financial Statements and reported amounts of consolidated revenues and expenses in the reporting period. Actual results could differ from those estimates. As interim statements, the Condensed Consolidated Financial Statements do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring items) considered necessary for a fair presentation in accordance with GAAP have been included. Results for the three and six months ended June 30, 2025 may not be indicative of the results that may be expected for the full year of 2025. For further information, please read the Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2024.

The accompanying Condensed Consolidated Financial Statements consolidate the accounts of all entities in which we have a controlling financial interest, as well as variable interest entities, if any, for which the Company is the primary beneficiary. All significant intercompany balances and transactions have been eliminated on the Condensed Consolidated Financial Statements.

We evaluate joint venture partnerships to determine if they should be consolidated based on whether the partners exercise joint control. For a joint venture where we exercise primary control and we also own a majority of the equity interests, we consolidate the joint venture partnership. We have consolidated the accounts of all of our joint venture partnerships on the accompanying Condensed Consolidated Financial Statements.

Use of Estimates

Our Condensed Consolidated Financial Statements are prepared in conformity with GAAP, which requires us to make estimates based on assumptions about current and, for some estimates, future economic and market conditions that affect reported amounts and related disclosures on our Condensed Consolidated Financial Statements. Although our current estimates contemplate current and expected future conditions, as applicable, it is reasonably possible that actual conditions could significantly differ from our expectations, which could materially affect our consolidated financial position and results of operations.

Trade Receivables and Current Estimate of Credit Losses

We grant credit to qualified guests, generally without collateral, in the form of trade accounts receivable. Trade receivables result from the rental of guestrooms and the sales of food, beverage, and banquet services and are payable under normal trade terms. Trade receivables also include credit and debit card transactions that are in the process of being settled. Trade receivables are stated at the amount billed to the guest and do not accrue interest. We regularly review the collectability of our trade receivables. A provision for losses is determined based on previous loss experience and current economic conditions. Our allowance for doubtful accounts was nominal at both June 30, 2025 and December 31, 2024. We recorded no bad debt expense for the three months ended June 30, 2025 and bad debt expense was $0.1 million for the three months ended June 30, 2024. Bad debt expense was $0.1 million and $0.2 million for the six months ended June 30, 2025 and 2024, respectively.

Investments in Lodging Property, net

The Company allocates the purchase price of acquired lodging properties based on the relative fair values of the acquired land, land improvements, building, furniture, fixtures and equipment, identifiable intangible assets or liabilities, other assets, and assumed liabilities. Intangible assets may include certain value associated with the on-going operations of the lodging property being acquired as part of the acquisition. Acquired intangible assets that derive their values from real property, or an interest in real property, are inseparable from that real property or interest in real property, do not produce or contribute to the production of income other than consideration for the use or occupancy of space, and are recorded as a component of the related real estate asset on our Condensed Consolidated Financial Statements. We allocate the purchase price of acquired lodging properties to land, building and furniture, fixtures and equipment based on independent third-party appraisals.

Our lodging properties and related assets are recorded at cost, less accumulated depreciation and amortization. We capitalize development costs and the costs of significant additions and improvements that materially upgrade, increase the value or extend the useful life of the property. These costs may include development, refurbishment, renovation, and remodeling expenditures, as well as certain indirect internal costs related to construction projects. If an asset requires a period of time in which to carry out the activities necessary to bring it to the condition necessary for its intended use, the interest cost incurred during that period as a result of expenditures for the asset is capitalized as part of the cost of the asset. We expense the cost of repairs and maintenance as incurred.

We generally depreciate our lodging properties and related assets using the straight-line method over their estimated useful lives as follows:


Classification						Estimated Useful Lives
Buildings and improvements						6 to 40 years
Furniture, fixtures and equipment						2 to 15 years

We periodically re-evaluate asset lives based on current assessments of remaining utilization, which may result in changes in estimated useful lives. Such changes are accounted for prospectively and will increase or decrease future depreciation expense.

When depreciable property and equipment is retired or disposed, the related costs and accumulated depreciation are removed from the balance sheet and any gain or loss is reflected in current operations.

On a limited basis, we provide financing to developers of lodging properties for development projects. We evaluate these arrangements to determine if we participate in residual profits of the lodging property through the loan provisions or other agreements. Where we conclude that these arrangements are more appropriately treated as an investment in the real property, we reflect the loan in Investments in lodging property, net on our Condensed Consolidated Balance Sheets.

We monitor events and changes in circumstances for indicators that the carrying value of a lodging property or undeveloped land may be impaired. Additionally, we perform at least an annual evaluation to monitor the factors that could trigger an impairment. Our evaluation process includes a quantitative analysis utilizing metrics to assess the operating performance of our lodging properties relative to historical results and profitability, and a qualitative analysis of other factors to assess if a potential impairment exists. Factors that we consider for an impairment analysis include, among others: i) significant underperformance relative to historical or anticipated operating results, ii) significant changes in the manner of use of a property or the strategy of our overall business, including changes in the estimated holding periods for lodging properties and land parcels, iii) a significant increase in competition, iv) a significant adverse change in legal factors or regulations, v) changes in values of comparable land or lodging property sales, vi) significant negative industry or economic trends, and vii) fair value less costs to sell of lodging properties held for sale relative to the contractual selling price. When such factors are identified, we prepare an estimate of the undiscounted future cash flows of the specific property and determine if the carrying amount of the asset is recoverable. If the carrying amount of the asset is not recoverable, we estimate the fair value of the property based on discounted cash flows or sales price if the property is under contract and an adjustment is made to reduce the carrying value of the property to its estimated fair value.

Assets Held for Sale

We classify assets as Assets held for sale in the period in which certain criteria are met, including when the sale of the asset within one year is probable. Assets classified as Assets held for sale are no longer depreciated and are carried at the lower of net book value or its fair value calculated as the expected selling price less estimated costs of disposition. We record a write-down when the carrying amounts of Assets held for sale exceed their fair value.

If we subsequently decide not to sell a long-lived asset (disposal group) classified in Assets held for sale, or if a long-lived asset (disposal group) no longer meets the Assets held for sale criteria, a long-lived asset (disposal group) is reclassified as Investments in lodging property, net in the period in which the Assets held for sale criteria are no longer met. A long-lived asset that is reclassified from Assets held for sale to Investments in lodging property, net is measured individually at the lower of either its:

i.) Carrying amount before it was classified as Assets held for sale, adjusted for any depreciation (amortization) expense or impairment losses that would have been recognized had the asset (group) been continuously classified as Investments in lodging property, net; or

ii.) Fair value at the date of the subsequent decision not to sell.

Segment Information

We have determined that we have one reportable segment for activities related to investing in lodging properties. An operating segment is defined as the component of an enterprise for which separate financial information is evaluated regularly by the chief operating decision maker (the “CODM”) in order to allocate resources and assess performance. Our investments in lodging properties are geographically diversified and the CODM allocates resources and assesses performance based upon discrete financial information at the individual lodging property level. However, because each of our lodging properties have similar economic characteristics, facilities, and services, the lodging properties have been aggregated into a single reportable segment.

Exchange or Modification of Debt

We consider modifications or exchanges of debt as extinguishments in accordance with Accounting Standards Codification ("ASC") No. 470, Debt, with gains or losses recognized in current earnings if the terms of the new debt and original instrument are substantially different. If the original and new debt instruments are substantially different, the original debt is derecognized and the new debt is initially recorded at fair value, with the difference recognized as an extinguishment gain or loss. Under an exchange or modification accounted for as a debt extinguishment, fees paid to the lenders are included in the gain or loss on extinguishment of debt. Costs incurred with third parties, such as legal fees, directly related to the exchange or modification are capitalized as deferred financing costs and amortized over the initial term of the new debt. Previously deferred fees and costs for existing debt are included in the calculation of gain or loss. Under an exchange or modification not accounted for as a debt extinguishment, fees paid to the lenders are reflected as additional debt discount and amortized as non-cash interest expense over the remaining initial term of the exchanged or modified debt. Furthermore, costs incurred with third parties, such as legal fees, directly related to the exchange or modification, are expensed as incurred. Additionally, previously deferred fees and costs are amortized as non-cash interest expense over the remaining initial term of the exchanged or modified debt.

Debt Issuance Costs

Debt issuance costs related to our long-term debt generally are recorded at cost as a discount to the related debt, and are amortized as interest expense on a straight-line basis, which approximates the interest method, over the life of the related debt instrument unless there is a significant modification to the debt instrument. Unamortized debt issuance costs related to our $275 million delayed draw term loan closed in March 2025 (the "$275 Million 2025 Delayed Draw Term Loan"), as discussed in detail in Note 5 - Debt, are included in Deferred charges, net as we have not yet drawn any amounts on this loan. Unamortized debt issuance costs related to all other debt are presented as a reduction to the related debt on the Condensed Consolidated Balance Sheets.

Income Taxes

We account for federal and state income taxes using the asset and liability method. Deferred tax assets and liabilities are recognized for: i) the future tax consequences attributable to differences between carrying amounts of existing assets and liabilities based on GAAP and the respective carrying amounts for tax purposes, and ii) operating losses and tax-credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which temporary differences are expected to be reversed or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date of the change in tax rates. However, deferred tax assets are recognized only to the extent that it is more likely than not they will be realized based on consideration of available evidence. Valuation allowances are provided if, based upon the weight of the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.

For the three and six months ended June 30, 2025, we have utilized the discrete effective tax rate method, as provided by ASC No. 740, Income Taxes—Interim Reporting, to calculate our interim income tax provision. The discrete method treats the year-to-date period as if it were the annual period and determines the income tax expense or benefit on that basis. We have historically calculated the provision for income taxes during interim reporting periods by applying an estimate of the annual effective tax rate for the full year to ordinary income (loss) for the reporting period. We determined that since small changes in estimated ordinary income (loss) would result in significant changes in the estimated annual effective tax rate, the annual effective tax rate method would not provide a reliable estimate of income tax expense for the three and six months ended June 30, 2025.

Earnings Per Share

Basic earnings (loss) per share (“EPS”) is computed by dividing net income (loss) available to common stockholders by the weighted-average number of shares of common stock outstanding for the period. We apply the two-class method of computing EPS, which requires the calculation of separate EPS amounts for participating securities. Under the two-class computation method, net losses are not allocated to participating securities unless the holder of the security has a contractual obligation to share in the losses. Any anti-dilutive securities are excluded from the basic per-share calculation.

Diluted EPS is computed by dividing net income (loss) available to common stockholders, as adjusted for dilutive securities, by the weighted-average number of shares of common stock outstanding plus dilutive securities. Any anti-dilutive securities are excluded from the diluted per-share calculation. Potentially dilutive shares include unvested restricted share grants, unvested performance share grants, shares of common stock issuable upon conversion of convertible debt and shares of common stock issuable upon conversion of Common Units of our Operating Partnership.

New Accounting Standards

In November 2024, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) No. 2024-03, Disaggregation of Income Statement Expenses, that will require entities to provide enhanced disclosures related to certain expense categories included on the Consolidated Statement of Operations. ASU No. 2024-03 is intended to increase transparency and provide investors with more detailed information about the nature of expenses reported on the face of the Consolidated Statement of Operations. ASU No. 2024-03 does not change the requirements for the presentation of expenses on the face of the consolidated statement of operations. Under ASU No. 2024-03, entities are required to disaggregate, in tabular format, expenses presented on the face of the Consolidated Statement of Operations - excluding earnings or losses from equity method investments - if they include any of the following expense categories: purchases of inventory, employee compensation, depreciation, intangible asset amortization, and depreciation or depletion. For any remaining items within each relevant expense caption, entities must provide a qualitative description of the nature of those expenses. ASU No. 2024-03 is effective for annual reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. While the adoption of ASU 2024-03 is not expected to have an effect on our Consolidated Financial Statements, it is expected to result in incremental disclosures within the Notes to our Consolidated Financial Statements.

NOTE 3 - INVESTMENTS IN LODGING PROPERTY, NET

Investments in Lodging Property, net

Investments in lodging property, net is as follows (in thousands):


	June 30, 2025		December 31, 2024
Lodging buildings and improvements	$	2,898,939	$	2,867,256
Land	416,200		415,574
Furniture, fixtures and equipment	302,061		296,476
Construction in progress	43,328		35,294
Intangible assets	32,267		32,267
Real estate development loan	4,576		4,576
	3,697,371		3,651,443
Less accumulated depreciation and amortization	(974,912)		(904,678)
	$	2,722,459	$	2,746,765

Depreciation and amortization expense related to our lodging properties (excluding amortization of franchise fees) was $37.0 million and $36.3 million for the three months ended June 30, 2025 and 2024, respectively, and $74.1 million and $72.9 million for the six months ended June 30, 2025 and 2024, respectively.

Lodging Property Sales

Undeveloped Parcel of Land - San Antonio, TX

We owned a 5.99-acre parcel of undeveloped land in San Antonio, TX that was classified as Assets held for sale at December 31, 2024. In February 2025, we closed on the sale of the parcel of undeveloped land for $1.3 million, which approximated its carrying amount.

Portfolio of Two Lodging Properties - New Orleans, LA

In April 2024, we completed the sale of the 202-guestroom Courtyard by Marriott and the 208-guestroom SpringHill Suites by Marriott, both located in New Orleans, LA, for an aggregate selling price of $73 million, which resulted in a gain of approximately $28.3 million that was recorded in the six months ended June 30, 2024.

Hilton Garden Inn - Bryan (College Station), TX

In April 2024, the GIC Joint Venture completed the sale of the 119-guestroom Hilton Garden Inn - Bryan (College Station), TX for $11 million. The net selling price of the lodging property approximated its carrying amount on the closing date.

Hyatt Place - Dallas (Plano), TX

In February 2024, the GIC Joint Venture completed the sale of the 127-guestroom Hyatt Place - Dallas (Plano), TX for $10.3 million. We recorded a nominal gain on the sale during the six months ended June 30, 2024 upon closing the transaction.

Intangible Assets

Intangible assets, net is as follows (in thousands):


	June 30, 2025		December 31, 2024
Indefinite-lived intangible assets:
Air rights	$	10,754	$	10,754
Other	80		80
	10,834		10,834
Finite-lived intangible assets:

Tax incentives	12,063		12,063
Key money	9,370		9,370


	21,433		21,433
Intangible assets	32,267		32,267
Less - accumulated amortization	(6,473)		(5,691)
Intangible assets, net	$	25,794	$	26,576

We recorded amortization expense related to intangible assets of approximately $0.4 million and $1.0 million for the three months ended June 30, 2025 and 2024, respectively, and $0.8 million and $2.1 million for the six months ended June 30, 2025 and 2024, respectively.

Future amortization expense related to intangible assets is as follows (in thousands):


For the Year Ending December 31,	Amount
2025	$	782
2026	1,564
2027	1,510
2028	1,016
2029	1,016
Thereafter	9,072
	$	14,960

NOTE 4 - INVESTMENT IN REAL ESTATE LOANS

Real Estate Development Loans

Onera Mezzanine Financing Loan

In January 2023, we entered into an agreement with affiliates of Onera Opportunity Fund I, LP (“Onera”) to provide a mezzanine financing loan of $4.6 million (the “Onera Mezzanine Loan”) for the development of a glamping property. The Onera Mezzanine Loan is secured by a second mortgage on the property and is subordinate to the senior lender for the development project. As of June 30, 2025, we have funded our entire $4.6 million commitment under the Onera Mezzanine Loan. The original maturity date of the loan was January 2025; however, the borrower exercised its option to extend the Onera Mezzanine Loan for an additional 12 months. The development of the property was completed and operations commenced in September 2024.

Additionally, we issued a $3 million letter of credit to the senior lender of the project as additional support for Onera's construction loan. We have not recorded a liability for this guarantee because it currently is not probable that we will be required to make any payment related to this guarantee. In the event that we are required to pay any amount under this guarantee, we would have the right to recover any amount paid under a guarantee from Onera.

We also have an option to purchase 90% of the equity of the entity that owns the property that became exercisable upon completion of construction in September 2024 (the “Onera Purchase Option”). The Onera Purchase Option is exercisable until the later of the first anniversary of the opening of the property or the date the Onera Mezzanine Loan is paid in full.

We recorded the estimated fair value of the Onera Purchase Option in Other assets and as a contra-asset to Investments in lodging property, net at its estimated fair value of $0.9 million on the transaction date using the Black-Scholes model. Our estimate of the fair value of the Onera Purchase Option under the Black-Scholes model requires judgment and estimates primarily related to the volatility of our stock price and expected levels of future dividends on our common stock.

The recorded amount of the Onera Purchase Option was amortized as non-cash interest income beginning in January 2023 using the straight-line method, which approximates the interest method, and through September 2024 when the Onera Purchase Option became exercisable. For the three and six months ended June 30, 2024, we amortized $0.1 million and $0.3 million, respectively of the carrying amount of the Onera Purchase Option as non-cash interest income.

NOTE 5 - DEBT

At June 30, 2025, our indebtedness was comprised of borrowings under our 2023 Senior Credit Facility, the 2024 Term Loan, the GIC Joint Venture Credit Facility, the GIC Joint Venture Term Loan, the PACE loan, the Convertible Notes (each of such credit facilities and loans are defined below), and two loans secured by first priority mortgage liens on three lodging properties. In March 2025, we closed the $275 Million 2025 Delayed Draw Term Loan to refinance a significant portion of our outstanding $287.5 million convertible notes when they mature in February 2026. As of June 30, 2025, we have not drawn any amounts under the 2025 Delayed Drawn Term Loan.

We have entered into interest rate swaps to fix the interest rates on a portion of our variable interest rate indebtedness. The weighted-average interest rate, after giving effect to our interest rate derivatives, for all borrowings was 5.03% at June 30, 2025 and 5.01% at December 31, 2024. There are currently no defaults under any of the Company's loan agreements.

Debt, net of debt issuance costs, is as follows (in thousands):


	June 30, 2025		December 31, 2024
Revolving debt	$	150,000	$	135,000
Term loans	921,037		921,037
Convertible notes	287,500		287,500
Mortgage loans	76,166		64,470
	1,434,703		1,408,007
Unamortized debt issuance costs (1)	(8,904)		(11,297)
Debt, net of debt issuance costs	$	1,425,799	$	1,396,710

(1) During the six months ended June 30, 2025, we paid $4.3 million in bank, legal and other fees related to the $275 million 2025 Delayed Draw Term Loan (as described in further detail below) that are included in Deferred charges, net on our Condensed Consolidated Balance Sheet. Those costs will be reclassified to Debt, net of debt issuance costs at the time the funds are drawn upon, which is expected to coincide with the repayment of the Convertible Notes upon their maturity in February 2026.

Our total fixed-rate and variable-rate debt, after consideration of our interest rate derivative agreements that are currently in effect, is as follows (in thousands):


	June 30, 2025		Percentage	December 31, 2024		Percentage
Fixed-rate debt (1)	$	988,666	69%	$	930,910	66%
Variable-rate debt	446,037		31%	477,097		34%
	$	1,434,703		$	1,408,007

(1) At June 30, 2025, debt related to our wholly-owned properties and our pro rata share of joint venture debt has a fixed-rate debt ratio of approximately 75% of our total pro rata indebtedness when taking into consideration interest rate swaps that are currently in effect.

Information about the fair value of our fixed-rate debt that is not recorded at fair value is as follows (in thousands):


	June 30, 2025				December 31, 2024
	Carrying Value		Fair Value		Carrying Value		Fair Value		Valuation Technique
Convertible notes	$	287,500	$	278,337	$	287,500	$	278,766	Level 1 - Market approach
Mortgage loans	18,166		17,851		18,410		17,344		Level 2 - Market approach
	$	305,666	$	296,188	$	305,910	$	296,110

Detailed information about our debt at June 30, 2025 and December 31, 2024 is as follows (dollars in thousands):

Principal Balance Outstanding

Lender

Interest Rate

Initial Maturity Date

Fully Extended Maturity Date

Number of
Encumbered Properties

June 30, 2025

December 31, 2024

OPERATING PARTNERSHIP DEBT:

2023 Senior Credit Facility

Bank of America, N.A.

$400 Million Revolver (1)

6.37% Variable

6/21/2027

6/21/2028

n/a

25,000

10,000

$200 Million Term Loan (1)

6.33% Variable

6/21/2026

6/21/2028

n/a

200,000

Total Senior Credit Facility

225,000

210,000

Convertible Notes

1.50% Fixed

2/15/2026

n/a

287,500

Term Loans

Regions Bank 2024 Term Loan Facility (1)

6.33% Variable

2/26/2027

2/26/2029

n/a

200,000

$275 Million 2025 Delayed Draw Term Loan

6.32% Variable

3/27/2028

3/27/2030

n/a

—

200,000

Total Operating Partnership Debt

712,500

697,500

JOINT VENTURE DEBT:

Brickell Joint Venture Mortgage Loan

City National Bank of Florida

n/a

6/9/2025

n/a

—

46,060

Wells Fargo Bank, N.A.

6.92% Variable

5/15/2028

5/15/2030

58,000

—

58,000

46,060

GIC Joint Venture Credit Facility and Term Loans

Bank of America, N.A.

$125 Million Revolver (2)

6.58% Variable

9/15/2027

9/15/2028

n/a

125,000

$125 Million Term Loan (2)

6.53% Variable

9/15/2027

9/15/2028

n/a

125,000

Bank of America, N.A. Term Loan (3)

7.19% Variable

1/13/2026

1/13/2027

n/a

396,037

Wells Fargo

4.99% Fixed

6/6/2028

12,391

12,526

PACE loan

6.10% Fixed

7/31/2040

n/a

5,775

5,884

Total GIC Joint Venture Credit Facility and Term Loans

664,203

664,447

Total Joint Venture Debt

722,203

710,507

Total Debt

1,434,703

1,408,007

(1) The 2023 Senior Credit Facility and the Regions Bank 2024 Term Loan Facility are supported by a borrowing base of 53 unencumbered hotel properties and their affiliates.

(2) The $125 Million Revolver and the $125 Million Term Loan are secured by pledges of the equity in the entities that own 15 lodging properties.

(3) The GIC Joint Venture Term Loan with Bank of America, N.A. is secured by pledges of the equity in the entities that own 25 lodging properties and two parking garages and their affiliates.

$600 Million Senior Credit and Term Loan Facility

In June 2023, the Operating Partnership, as borrower, the Company, as parent guarantor, and each party executing the loan documentation as a subsidiary guarantor, entered into an amended and restated $600 million senior credit facility (the “2023 Senior Credit Facility”) with Bank of America, N.A., as successor administrative agent, and a syndicate of lenders. The 2023 Senior Credit Facility is comprised of a $400 million revolver (the “$400 Million Revolver”) and a $200 million term loan facility (the “$200 Million Term Loan”). The 2023 Senior Credit Facility has an accordion feature which allows the Company to increase the total commitments by an aggregate of up to $300 million.

At June 30, 2025, our $200 Million Term Loan was fully funded, and we had $25 million in outstanding borrowings under our $400 Million Revolver.

The $400 Million Revolver has a maturity date of June 2027, which may be extended by the Company for up to two consecutive six-month periods, subject to certain conditions, and the $200 Million Term Loan has a maturity date of June 2026, which may be extended by the Company for up to two consecutive 12-month periods, subject to certain conditions.

The 2023 Senior Credit Facility bears interest at the Secured Overnight Funding Rate (“SOFR”) plus a SOFR adjustment of 10 basis points and a margin that is the higher of (i) a pricing grid ranging from 140 basis points to 240 basis points plus Adjusted Daily SOFR or Adjusted Term SOFR, depending on the Company's leverage ratio (as defined in the loan documents); and (ii) a pricing grid ranging from 40 basis points to 140 basis points over the Base Rate, depending on the Company's leverage ratio.

The $200 Million Term Loan bears interest at the Secured Overnight Funding Rate (“SOFR”) plus a SOFR adjustment of 10 basis points and a margin that is the higher of (i) a pricing grid ranging from 135 basis points to 235 basis points plus Adjusted Daily SOFR or Adjusted Term SOFR, depending on the Company's leverage ratio (as defined in the loan documents); and (ii) a pricing grid ranging from 35 basis points to 135 basis points over the Base Rate, depending on the Company's leverage ratio.

We are also required to pay an unused fee (the “Unused Fee”) on the undrawn portion of the $400 Million Revolver. The Unused Fee is calculated on a daily basis on the unused amount of the $400 Million Revolver multiplied by (i) 0.25% per annum in the event that the unused amount is greater than 50% of the maximum aggregate amount of the $400 Million Revolver, or (ii) 0.20% per annum in the event that the unused amount is equal to or less than 50% of the maximum aggregate amount of the $400 Million Revolver. The Unused Fee is payable quarterly in arrears and on the final maturity date of the $400 Million Revolver.

We are required to comply with various financial and other covenants to draw and maintain borrowings under the $400 Million Revolver.

Amendment to the 2023 Senior Credit Facility

In September 2024, we executed an amendment to the 2023 Senior Credit Facility. Under the amendment, we may elect at our sole discretion that the Unsecured Leverage Ratio (as defined in the loan documents) may exceed 60% but shall in no event exceed 65% for such fiscal quarter and the next three succeeding fiscal quarters (the “Unsecured Leverage Increase Period”). Once this one-time right has been exercised and after the Unsecured Leverage Increase Period expires, the 2023 Senior Credit Facility will revert back to the prior Unsecured Leverage Ratio pursuant to which the credit availability under the 2023 Senior Credit Facility will be limited to the 60% Unsecured Leverage Ratio for the remainder of the term of the 2023 Senior Credit Facility. We have not yet made the election under the amendment.

2024 Term Loan

In February 2024, our Operating Partnership, as borrower, the Company, as parent guarantor, and each party executing the term loan document as a subsidiary guarantor, entered into a $200 million senior unsecured term loan financing (the “2024 Term Loan”) with Regions Bank. Proceeds from the 2024 Term Loan financing and advances on our $400 Million Revolver were used to repay in full a similar term loan that was scheduled to mature in February 2025.

The 2024 Term Loan has an initial maturity date of February 2027 and can be extended for two 12-month periods by the Company, subject to certain conditions. At June 30, 2025, the 2024 Term Loan was fully funded.

We pay interest on advances at varying rates, based upon, at our option, either daily, 1-, 3-, or 6-month SOFR (subject to a floor of zero basis points), plus a SOFR adjustment equal to 10 basis points and an applicable margin between 135 and 235 basis points, depending upon our leverage ratio (as defined in the loan documents).

We are required to comply with various financial and other covenants to maintain borrowings under the 2024 Term Loan.

Amendment to 2024 Term Loan

In September 2024, we executed an amendment to the 2024 Term Loan. Under the amendment, we may elect at our sole discretion that the Unsecured Term Loan Leverage Ratio (as defined in the loan documents) may exceed 60% but shall in no event exceed 65% during the Unsecured Term Loan Leverage Increase Period. Once this one-time right has been exercised and after the Unsecured Term Loan Leverage Increase Period expires, the 2024 Term Loan will revert back to the prior Unsecured Term Loan Leverage Ratio pursuant to which the credit availability under the 2024 Term Loan will be limited to the 60% Unsecured Term Loan Leverage Ratio for the remainder of the term of the 2024 Term Loan. We have not yet made the election under the amendment.

Borrowings under the 2023 Senior Credit Facility and the 2024 Term Loan are limited by the value of the Unencumbered Assets (as defined in the loan agreements).

Convertible Senior Notes and Capped Call Options

In January 2021, we entered into an underwriting agreement (the “Convertible Notes Offering”) pursuant to which the Company agreed to offer and sell an aggregate of $287.5 million of 1.50% convertible senior notes due in 2026 (the “Convertible Notes”). The net proceeds from the Convertible Notes Offering, after deducting underwriting discounts and commissions and offering expenses payable by the Company (including net proceeds from the full exercise by the underwriters of their over-allotment option to purchase additional Convertible Notes), were approximately $280 million before consideration of the Capped Call Transactions (as described below). These proceeds were used to pay the cost of the Capped Call Transactions and to partially repay outstanding obligations under our senior credit facility that was replaced by the 2023 Senior Credit Facility and another term loan.

The Convertible Notes bear interest at a rate of 1.50% per year, payable semi-annually in arrears on February 15 and August 15 of each year, beginning on August 15, 2021. The Convertible Notes will mature on February 15, 2026 (the “Maturity Date”), unless earlier converted, purchased, or redeemed. Prior to August 15, 2025, the Convertible Notes will be convertible only upon certain circumstances and during certain periods. On or after August 15, 2025 and through the Maturity Date, holders may convert any of their Convertible Notes into shares of the Company’s common stock, at the applicable conversion rate, unless the Convertible Notes have been previously purchased or redeemed by the Company. The Company recorded interest expense of $1.1 million for each of the three-month periods ended June 30, 2025 and 2024, and $2.2 million for each of the six-month periods ended June 30, 2025 and 2024. The Company incurred debt issuance costs related to the Convertible Notes Offering of $7.6 million, of which $0.4 million was amortized as non-cash interest expense for each of the three-month periods ended June 30, 2025 and 2024, respectively, and $0.7 million for each of the six-month periods ended June 30, 2025 and 2024. Including the amortization of the debt issuance costs, the effective interest rate on the Convertible Notes was approximately 2.00% for the three and six-month periods ended June 30, 2025 and 2024. The unamortized discount related to the Convertible Notes was $1.0 million and $1.7 million at June 30, 2025 and December 31, 2024, respectively.

The initial conversion rate of the Convertible Notes was 83.4028 shares of common stock per $1,000 principal amount of Convertible Notes, which was equivalent to an initial conversion price of $11.99 per share of common stock based on the 37.5% base conversion premium on the reference price of $8.72 per share. In no event will the conversion rate exceed 114.6788 shares of common stock per $1,000 principal amount of Convertible Notes, subject to certain adjustments defined in the Convertible Notes Offering. Commensurate with the declaration of dividends and distributions on our common stock and Common Units, respectively, in April 2025, the conversion rate of the Convertible Notes was adjusted to 94.15 shares of common stock per $1,000 principal amount of Convertible Notes.

In January 2021, the Company entered into privately negotiated capped call transactions (the “Capped Call Transactions”) with certain of the underwriters or their respective affiliates and another financial institution (the “Capped Call Counterparties”). The Capped Call Transactions initially cover, subject to anti-dilution adjustments substantially similar to those applicable to the Convertible Notes, the number of shares of common stock underlying the Convertible Notes. The Capped Call Transactions are generally expected to reduce the potential dilution to holders of shares of common stock upon conversion of the Convertible Notes or offset the potential cash payments that the Company could be required to make in excess of the principal amount of any converted Convertible Notes upon conversion thereof, with such reduction or offset subject to a cap.

The effective strike price of the Capped Call Transactions was initially $15.26, which represented a premium of 75.0% over the last reported sale price of our common stock on the New York Stock Exchange on January 7, 2021 and is subject to certain adjustments under the terms of the Capped Call transactions. The current strike price is $13.52 due to the adjustments related to the dividends paid during the period that the Capped Call securities have been outstanding.

$275 Million 2025 Delayed Draw Term Loan

In March 2025, the Operating Partnership, as borrower, the Company, as parent guarantor, and each party executing the loan documentation as a subsidiary guarantor, entered into the $275 Million 2025 Delayed Draw Term Loan with Bank of America, N.A., as administrative agent. The $275 Million 2025 Delayed Draw Term Loan will be used to refinance a significant portion of our Convertible Notes which mature in February 2026. The $275 Million 2025 Delayed Draw Term Loan has a delayed draw feature through March 1, 2026, to ensure the funds are available through the maturity date of the Convertible Notes, and has an accordion feature which allows the Company to increase the total commitments to $325 million.

The $275 Million 2025 Delayed Draw Term Loan has an initial maturity date of March 27, 2028 and can be extended for two 12-month periods by the Company, subject to certain conditions, resulting in a fully extended maturity of March 2030. At June 30, 2025, we had not yet drawn any amounts on this loan.

Advances under the $275 Million 2025 Delayed Draw Term Loan will bear interest at varying rates based upon, at our option, either (i) Daily SOFR or Term SOFR (1-month, 3-month or 6-month), plus a SOFR adjustment of 10 basis points, plus a margin ranging from 135 basis points to 235 basis points depending on our leverage ratio, or (ii) the applicable base rate, which is the greatest of the administrative agent’s prime rate, the federal funds rate plus 50 basis points, and 1-month Term SOFR plus 100 basis points, plus a base rate margin ranging from 35 basis points to 135 basis points, depending on our leverage ratio.

We are also required to pay a fee on the unused portion of the $275 Million 2025 Delayed Draw Term Loan equal to the undrawn amount multiplied by an annual rate of 0.25% of the average unused amount of the $275 Million 2025 Delayed Draw Term Loan.

During the six months ended June 30, 2025, we incurred debt issuance costs related to the $275 Million 2025 Delayed Draw Term Loan of $4.3 million. The debt issuance costs are recorded as deferred financing costs and are included in Deferred charges, net on our Condensed Consolidated Balance Sheet at June 30, 2025. Amortization of the deferred financing costs will commence when we draw on the $275 Million 2025 Delayed Draw Term Loan.

GIC Joint Venture Credit Facility

In October 2019, Summit JV MR 1, LLC (the “Borrower”), as borrower, and Summit Hospitality JV, LP (the “Parent” or “GIC Joint Venture”), as parent of the Borrower, and each party executing the credit facility documentation as a subsidiary guarantor, entered into a credit facility that is currently $250 million (the “GIC Joint Venture Credit Facility”) with Bank of America, N.A., as administrative agent and sole initial lender, and BofA Securities, Inc., as sole lead arranger and sole bookrunner. The Operating Partnership and the Company are not borrowers or guarantors of the GIC Joint Venture Credit Facility. The GIC Joint Venture Credit Facility is guaranteed by all of the Borrower’s existing and future subsidiaries, subject to certain exceptions.

The GIC Joint Venture Credit Facility is comprised of a $125 million revolving credit facility (the “$125 Million Revolver”) and a $125 million term loan (the “$125 Million Term Loan”). The GIC Joint Venture Credit Facility has an accordion feature which allows the GIC Joint Venture to further increase the total commitments for aggregate borrowings of up to $500 million. At June 30, 2025, we had $125 million outstanding under the $125 Million Revolver and the $125 Million Term Loan was fully funded.

The interest rate on the $125 Million Revolver is based on the higher of the following:

i.Daily SOFR or Term SOFR (1-month or 3-month), plus a SOFR adjustment of 0.10%, plus a margin of 2.15%, or,

ii.the applicable base rate, which is the greater of the administrative agent’s prime rate, the federal funds rate plus 0.50%, and 1-month Term SOFR plus 1.00%, plus a base rate margin of 1.15%.

The interest rate on the $125 Million Term Loan is five basis points less than the interest rate on the $125 Million Revolver.

In addition, on a quarterly basis, the GIC Joint Venture will be required to pay a fee on the unused portion of the GIC Joint Venture Credit Facility equal to the undrawn amount multiplied by an annual rate of 0.25% of the average unused amount of the GIC Joint Venture Credit Facility.

The GIC Joint Venture Credit Facility requires the GIC Joint Venture and certain subsidiaries to pledge to the secured parties all of the equity interests in the entities that own the 15 properties included in the borrowing base assets, the related TRS entities that lease each of the borrowing base assets, and all other subsidiaries of the borrower and the subsidiary guarantors, subject to certain exceptions.

GIC Joint Venture Term Loan

In January and March 2022, the Operating Partnership and the GIC Joint Venture closed on a transaction with NewcrestImage Holdings, LLC and NewcrestImage Holdings II, LLC (together, “NewcrestImage”), to acquire a portfolio of 27 lodging properties, containing an aggregate of 3,709 guestrooms, and two parking structures containing 1,002 spaces, and various financial incentives, for an aggregate purchase price of $822 million (the “NCI Transaction”). In connection with the NCI Transaction, in January 2022, Summit JV MR 2, LLC, Summit JV MR 3, LLC and Summit NCI NOLA BR 184, LLC (each of which is a subsidiary of the GIC Joint Venture, and are collectively, the “Term Loan Borrower”), the GIC Joint Venture, as parent guarantor, and each party executing the credit facility documentation as a subsidiary guarantor, entered into a $410 million senior secured term loan facility (the “GIC Joint Venture Term Loan”) with Bank of America, N.A., as administrative agent.

Neither the Operating Partnership nor the Company are borrowers or guarantors of the GIC Joint Venture Term Loan. The GIC Joint Venture Term Loan is guaranteed by the GIC Joint Venture and all of the Term Loan Borrower's existing and future subsidiaries, subject to certain exceptions.

The GIC Joint Venture Term Loan has an accordion feature that permits an increase in the total commitments by up to $190 million, for aggregate potential borrowings of up to $600 million. The GIC Joint Venture Term Loan will mature on January 13, 2026 and can be extended for one 12-month period at the option of the GIC Joint Venture, subject to certain conditions. As such, the GIC Joint Venture Term Loan has a fully extended maturity date of January 2027. In February 2023, the GIC Joint Venture entered into an amendment to the GIC Joint Venture Term Loan to amend certain definitions, revise the minimum borrowing base interest coverage ratio and make certain other changes.

At June 30, 2025, we had $396 million outstanding on the GIC Joint Venture Term Loan bearing interest at a floating rate of SOFR plus a SOFR adjustment of 10 basis points and a margin of 2.75%.

The GIC Joint Venture Term Loan is secured primarily by a first priority pledge of the Term Loan Borrower's equity interests in the subsidiaries that hold a direct or indirect interest in the remaining 25 lodging properties and two parking facilities purchased in the NCI Transaction that constitute borrowing base assets. The GIC Joint Venture Term Loan contains terms, conditions, and covenants typical for similar credit facilities.

In July 2025, the Company closed on a new $400 million senior unsecured term loan (the "2025 GIC Joint Venture Term Loan") that refinanced and replaced the GIC Joint Venture Term Loan. The 2025 GIC Joint Venture Term Loan has an initial maturity date of July 2028 and can be extended for two 12-month periods at the Company’s option, subject to certain conditions, for a fully extended maturity date of July 2030.

The 2025 GIC Joint Venture Term Loan provides for an interest rate equal to SOFR plus 235 basis points. Proceeds from the 2025 GIC Joint Venture Term Loan financing were used to repay in full the GIC Joint Venture Term Loan that was scheduled to mature in January 2026. Other terms of the agreement are similar to the GIC Joint Venture Term Loan.

PACE Loan

As part of the NCI Transaction, a subsidiary of the GIC Joint Venture assumed a Property Assessed Clean Energy (“PACE”) loan of approximately $6.5 million. The loan bears fixed interest at 6.10%, has an amortization period of 20 years, and matures on July 31, 2040. The PACE loan is secured by an assessment lien imposed by the County of Tarrant, TX for the benefit of the lender. At June 30, 2025, the outstanding balance of the PACE loan was $5.8 million.

Brickell Mortgage Loan

In June 2022, the Company entered into a joint venture (the “Brickell Joint Venture”) with C-F Brickell, LLC (“C-F Brickell”) that was the developer of the dual-branded 264-guestroom AC Hotel by Marriott and Element Hotel in Miami, FL (together the "AC/Element Hotel"), to facilitate the exercise of a purchase option to acquire a 90% equity interest in the Brickell Joint Venture (the "Initial Purchase Option"), which owned a 100% interest in the AC/Element Hotel. The Brickell Joint Venture entered into a $47 million mortgage loan and non-recourse guarantee with City National Bank of Florida to fund a portion of the Initial Purchase Option.

In May 2025, the Brickell Joint Venture closed on a $58 million mortgage loan (the "Brickell Mortgage Loan") with Wells Fargo Bank, N.A., as administrative agent, the proceeds of which were primarily used to repay the $45.4 million outstanding balance of the mortgage loan with City National Bank of Florida that was scheduled to mature in June 2025.

The Brickell Mortgage Loan provides for an interest rate equal to one-month term SOFR plus 260 basis points. Payments on the Brickell Mortgage Loan are interest-only during the term of the loan, subject to certain financial requirements. The Brickell Mortgage Loan will mature in May 2028, and can be extended for two 12-month periods at the option of the Brickell Joint Venture, subject to certain conditions.

Mortgage Loan Repayment

In June 2017, Summit Meta 2017, LLC, a subsidiary of our Operating Partnership, entered into a $47.6 million secured, non-recourse loan with MetaBank (the "MetaBank Loan"). In June 2024, the outstanding balance of the loan was $42.3 million at which time we repaid the MetaBank Loan for $39.1 million prior to its scheduled maturity date, which represented a discount of $3.2 million and resulted in a gain on extinguishment of debt of $3.0 million after legal fees and unamortized debt issuance costs that were written-off on the closing date.

NOTE 6 - LEASES

The Company has operating leases related to the land under certain lodging properties, conference centers, parking spaces, automobiles, our corporate office, and miscellaneous office equipment. These leases have remaining terms of one year to 73 years, some of which include options to extend the leases for additional years. The exercise of lease renewal options is at our sole discretion. Certain leases also include options to purchase the leased property. At June 30, 2025 and December 31, 2024, the weighted-average operating lease term was approximately 31.4 years and 31.8 years, respectively, and our weighted-average incremental borrowing rate for leases was 4.8%.

Certain of our lease agreements include rental payments based on a percentage of revenue over contractual levels and others include rental payments adjusted periodically for inflation. Our lease agreements do not contain any material residual value guarantees or restrictive covenants that materially affect our business. In addition, we lease certain owned real estate to third parties. We recorded gross third-party tenant income of $1.3 million and $0.6 million during the three months ended June 30, 2025 and 2024, respectively, and $2.4 million and $1.4 million during the six months ended June 30, 2025 and 2024, respectively, in Other income, net on our Condensed Consolidated Statements of Operations.

For each of the three months ended June 30, 2025 and 2024, the Company's total operating lease cost was $1.1 million, and the cash payments on operating leases were $1.1 million and $1.0 million during the three months ended June 30, 2025 and 2024, respectively.

For each of the six months ended June 30, 2025 and 2024, the Company's total operating lease cost was $2.3 million and the cash payments on operating leases were $2.1 million and $2.0 million, respectively.

Operating lease maturities at June 30, 2025 are as follows (in thousands):


For the Year Ending December 31,	Amount
2025	$	1,248
2026	2,417
2027	2,460
2028	2,278
2029	2,058
Thereafter	33,803
Total lease payments (1)	44,264
Less: Imputed interest	(19,501)
Total	$	24,763

(1)Certain payments above include future increases to the minimum fixed rent based on the Consumer Price Index in effect at the initial measurement of the lease balances.

NOTE 7 - DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING

Information about our derivative financial instruments at June 30, 2025 and December 31, 2024 is as follows (dollars in thousands):


						Notional Amount				Fair Value
Contract Date	Effective Date	Expiration Date	Average Annual Effective Fixed Rate			June 30, 2025		December 31, 2024		June 30, 2025		December 31, 2024
Operating Partnership:

June 11, 2018	December 31, 2018	December 31, 2025	2.92	%		$	125,000	$	125,000	$	807	$	1,582
July 26, 2022	January 31, 2023	January 31, 2027	2.60	%		100,000		100,000		1,455		2,824
July 26, 2022	January 31, 2023	January 31, 2029	2.56	%		100,000		100,000		2,638		5,325
June 5, 2025	June 2, 2025	May 15, 2028	3.57	%		58,000		—		(347)		—
Total Operating Partnership						383,000		325,000		4,553		9,731

GIC Joint Venture:
March 24, 2023	July 1, 2023	January 13, 2026	3.35	%		100,000		100,000		385		754
March 24, 2023	July 1, 2023	January 13, 2026	3.35	%		100,000		100,000		385		754
January 19, 2024	October 1, 2024	January 13, 2026	3.77	%		100,000		100,000		165		334
Total GIC Joint Venture						300,000		300,000		935		1,842
Total			3.13	%	(1)	$	683,000	$	625,000	$	5,488	$	11,573

(1) Represents the weighted-average effective interest rate of our current interest rate swaps at June 30, 2025.

At June 30, 2025, debt related to our wholly-owned properties and our pro rata share of joint venture debt has a fixed-rate debt ratio of approximately 75% of our total pro rata indebtedness when taking into consideration interest rate swaps that are currently in effect.

At June 30, 2025 and December 31, 2024, we had $683 million and $625 million, respectively, of debt with variable interest rates that had been converted to fixed interest rates through derivative financial instruments which are carried at fair value. Differences between carrying value and fair value of our fixed-rate debt are primarily due to changes in interest rates. Inherently, fixed-rate debt is subject to fluctuations in fair value as a result of changes in the current market rate of interest on the valuation date.

In June 2025, the Operating Partnership entered into a $58 million interest rate swap related to the Brickell Mortgage Loan to fix one-month term SOFR until May 2028. The interest rate swap has an effective date of June 2, 2025 and a termination date of May 15, 2028.

Our interest rate swaps have been designated as cash flow hedges and are valued using a market approach, which is a Level 2 valuation technique. At June 30, 2025, all except for one of our interest rate swaps were in an asset position, and at December 31, 2024, all of our interest rate swaps were in an asset position. Derivative assets related to our interest rate swaps are recorded in Other assets and derivative liabilities are recorded in Accrued expenses on our Condensed Consolidated Balance Sheets. We are not required to post any collateral related to these agreements and are not in breach of any financial provisions of the agreements.

Changes in the fair value of the hedging instruments are deferred in Accumulated other comprehensive income on our Condensed Consolidated Balance Sheets and are reclassified to Interest expense on our Condensed Consolidated Statements of Operations in the period in which the hedged item affects earnings. In the next 12 months, we estimate that $4.3 million will be reclassified from Accumulated other comprehensive income and recorded as a decrease to Interest expense.

We characterize the realized and unrealized gain or loss related to derivative financial instruments designated as cash flow hedges as follows (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Unrealized (loss) gain recognized in Accumulated other comprehensive income (loss) on derivative financial instruments	$	(395)	$	3,097	$	(2,093)	$	12,473
Gain reclassified from Accumulated other comprehensive income to Interest expense	$	2,023	$	3,660	$	3,992	$	7,340
Total interest expense and other finance expense presented on the Condensed Consolidated Statements of Operations in which the effects of cash flow hedges are recorded	$	20,628	$	20,830	$	40,584	$	42,412

NOTE 8 - EQUITY

Common Stock

The Company is authorized to issue up to 500,000,000 shares of common stock, $0.01 par value per share (“Common Stock”). Each outstanding share of our Common Stock entitles the holder to one vote on all matters submitted to a vote of stockholders, including the election of directors and, except as may be provided with respect to any other class or series of stock, the holders of such shares possess the exclusive voting power.

Changes in Common Stock during the six months ended June 30, 2025 and 2024 were as follows:


	2025	2024
Beginning shares of Common Stock outstanding	108,435,663	107,593,373

Common Unit redemptions	2,923,797	310
Repurchases of Common Stock	(3,585,179)	—
Grants under the Equity Plan (as defined below in Note 12 - Equity-Based Compensation)	1,269,495	1,055,544
Annual grants to independent directors	189,826	127,491


Performance and time-based share forfeitures	(182,711)	(355,821)
Shares acquired for employee withholding requirements	(239,383)	(144,654)
Ending shares of Common Stock outstanding	108,811,508	108,276,243

Preferred Stock

The Company is authorized to issue up to 100,000,000 shares of preferred stock, $0.01 par value per share, of which 89,600,000 is currently undesignated, 6,400,000 shares have been designated as 6.25% Series E Cumulative Redeemable Preferred Stock (the “Series E Preferred Stock”) and 4,000,000 shares have been designated as 5.875% Series F Cumulative Redeemable Preferred Stock (the “Series F Preferred Stock”).

The Company's outstanding shares of preferred stock (collectively, “Preferred Shares”) rank senior to our Common Stock and on parity with each other with respect to the payment of dividends and distributions of assets in the event of a liquidation, dissolution, or winding up. The Preferred Shares do not have maturity dates and are not subject to mandatory redemption or sinking fund requirements. The Series E Preferred Stock is redeemable by the Company at its election. The Company may not redeem the Series F Preferred Stock prior to August 12, 2026, except in limited circumstances relating to the Company’s continuing qualification as a REIT or in connection with certain changes in control. When redeemable, the Company may, at its option, redeem the applicable Preferred Shares, in whole or from time to time in part, by payment of $25 per share, plus any accumulated, accrued and unpaid dividends up to, but not including the date of redemption. If the Company does not exercise its rights to redeem the Preferred Shares upon certain changes in control, the holders of the Preferred Shares have the right to convert some or all of their shares into a number of the Company’s Common Stock based on a defined formula, subject to a share cap, or alternative consideration. The share cap on each share of Series E Preferred Stock and Series F Preferred Stock is 3.1686 and 5.8275 shares of Common Stock, respectively, all subject to certain adjustments.

The Company pays dividends at an annual rate of $1.5625 for each share of Series E Preferred Stock and $1.46875 for each share of Series F Preferred Stock. Dividend payments are made quarterly in arrears on or about the last day of February, May, August, and November of each year.

2025 Share Repurchase Program

On April 29, 2025, our Board of Directors authorized the repurchase of up to $50 million of our Common Stock (the “2025 Share Repurchase Program”). Repurchases may be made from time to time at management’s discretion, at prices management considers to be attractive, through open market purchases, subject to availability. Open market purchases will be conducted in accordance with the limitations set forth in Rule 10b-18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and other applicable legal requirements. We have no obligation to repurchase any shares under the program, and the timing, actual number and value of the shares that are repurchased, if any, are at the discretion of management. The 2025 Share Repurchase Program does not have an expiration date.

During the three and six months ended June 30, 2025 the Company repurchased 3,585,179 shares of our Common Stock under the 2025 Share Repurchase Program for an aggregate purchase price and commissions of $15.4 million, or an average of approximately $4.30 per share. As of June 30, 2025, approximately $34.6 million remained available for repurchase under the 2025 Stock Repurchase Program.

NOTE 9 - NON-CONTROLLING INTERESTS AND REDEEMABLE NON-CONTROLLING INTERESTS

Non-controlling Interests in Operating Partnership

Pursuant to the limited partnership agreement of our Operating Partnership, the unaffiliated third parties who hold Common Units have the right to request that we redeem their Common Units in exchange for cash based upon the fair value of an equivalent number of our shares of Common Stock at the time of redemption; however, the Company has the option to redeem Common Units with shares of our Common Stock on a one-for-one basis. The number of shares of our Common Stock issuable upon redemption of Common Units may be adjusted upon the occurrence of certain events such as share dividend payments, share subdivisions or combinations.

During the six months ended June 30, 2025, 2.9 million Common Units were converted to shares of our Common Stock. The conversion was recorded based on the average value per Common Unit on the original issuance dates. NewcrestImage and other unaffiliated third parties collectively owned 13,009,276 and 15,933,073 of Common Units at June 30, 2025 and December 31, 2024, respectively, which represents approximately 11% and 13% of the outstanding Common Units, respectively.

We classify outstanding Common Units held by unaffiliated third parties as Non-controlling interests, a component of equity on our Condensed Consolidated Balance Sheets. The portion of net income (loss) allocated to these Common Units is included on the Company’s Condensed Consolidated Statements of Operations as Net income (loss) attributable to non-controlling interests.

Non-controlling Interests in Consolidated Joint Ventures

At June 30, 2025, the Company is a partner with a majority equity interest in the three joint ventures described below, which are consolidated on our Condensed Consolidated Financial Statements. The portion of net income (loss) allocated to these non-controlling interests is included on the Company’s Condensed Consolidated Statements of Operations as Income attributable to non-controlling interests.

GIC Joint Venture

In July 2019, the Company entered into the GIC Joint Venture to acquire assets that align with the Company’s current investment strategy and criteria. The Company serves as general partner and asset manager of the GIC Joint Venture and has historically and in the future intends to invest 51% of the equity capitalization of the limited partnership, with GIC investing the remaining 49%. The Company earns fees for providing services to the GIC Joint Venture and has the potential to earn incentive fees based on the GIC Joint Venture achieving certain return thresholds. At June 30, 2025, the GIC Joint Venture owns 41 lodging properties containing 5,732 guestrooms in 11 states.

The GIC Joint Venture owns the lodging properties through master REITs (the “Master REIT”) and subsidiary REITs (the “Subsidiary REIT”). All of the lodging properties owned by the GIC Joint Venture are leased to taxable REIT subsidiaries of the Subsidiary REITs (the “Subsidiary REIT TRSs”). To qualify as a REIT, the Master REIT and each Subsidiary REIT must meet all of the REIT requirements provided in the Internal Revenue Code, as amended. Taxable income related to the Subsidiary REIT TRSs is subject to federal, state and local income taxes at applicable tax rates.

Brickell Joint Venture

In June 2022, the Company entered into the Brickell Joint Venture to complete the exercise of the Initial Purchase Option. Our joint venture partner, C-F Brickell, owns the remaining 10% equity interest in the Brickell Joint Venture. The Company has a second option to purchase the remaining 10% equity interest in the Brickell Joint Venture from C-F Brickell in December 2026 at its market value on the exercise date. The Company serves as the managing member of the Brickell Joint Venture.

Onera Joint Venture

In October 2022, the Company entered into the Onera Joint Venture with the acquisition of a 90% equity interest in the Onera Joint Venture. Our joint venture partner, Onera Opportunity Fund I, LP, a developer of alternative accommodation properties, owns the remaining 10% equity interest in the Onera Joint Venture. The Company serves as the managing member of the Onera Joint Venture. The Onera Joint Venture owns a 100% fee simple interest in real property and improvements located in Fredericksburg, TX.

The Onera Joint Venture recently completed development of the second phase of the property in Fredericksburg, TX. As of June 30, 2025, the property consists of 35 units.

Redeemable Non-controlling Interests

In connection with the NCI Transaction, Summit Hotel GP, LLC, a wholly-owned subsidiary of the Company and the sole general partner of the Operating Partnership, on its own behalf as general partner of the Operating Partnership and on behalf of the limited partners of the Operating Partnership, on January 13, 2022, entered into the Tenth Amendment (the “Tenth Amendment”) to the First Amended and Restated Agreement of Limited Partnership of the Operating Partnership, to provide for the issuance of up to 2,000,000 Series Z Preferred Units. The Series Z Preferred Units rank on a parity with the Operating Partnership’s 6.25% Series E and 5.875% Series F Preferred Units and holders will receive quarterly distributions at a rate of 5.25% per year. From issuance until the tenth anniversary of their issuance, the Series Z Preferred Units will be redeemable at the holder’s request at any time, or in connection with a change of control of the Company, for cash or shares of the Company’s 5.25% Series Z Cumulative Perpetual Preferred Stock (which will be designated and authorized following receipt of notice of redemption by the holder of the Series Z Preferred Units) at the Company’s election, on a one-for-one basis. After the fifth anniversary of issuance, the Company may redeem the Series Z Preferred Units for cash at a redemption amount of $25 per unit. For a 90-day period immediately following both the tenth and the eleventh anniversaries of their issuance or in connection with a change of control of the Company, the Series Z Preferred Units will be redeemable at the holder’s request for cash at a redemption amount of $25 per unit. In January 2022 and March 2022, in connection with the NCI Transaction, the Operating Partnership issued an aggregate of 2,000,000 Series Z Preferred Units as partial consideration for the purchase. At June 30, 2025, the redeemable Series Z Preferred Units issued in connection with the NCI Transaction are recorded as temporary equity and reflected as Redeemable non-controlling interests on our Condensed Consolidated Balance Sheets.

NOTE 10 - FAIR VALUE MEASUREMENT

The following table presents information about our financial instruments measured at fair value on a recurring basis at June 30, 2025 and December 31, 2024. In instances in which the inputs used to measure fair value fall into different levels of the fair value hierarchy, we classify assets and liabilities based on the lowest level of input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability.

Disclosures concerning financial instruments measured at fair value are as follows (in thousands):


	Fair Value Measurements at June 30, 2025 using
	Level 1		Level 2		Level 3		Total
Assets:
Interest rate swaps	$	—	$	5,835	$	—	$	5,835
Onera Purchase Option	—		—		931		931

Liabilities:
Interest rate swaps	—		347		—		347


	Fair Value Measurements at December 31, 2024 using
	Level 1		Level 2		Level 3		Total
Assets:
Interest rate swaps	$	—	$	11,573	$	—	$	11,573
Onera Purchase Option	—		—		931		931

The Onera Purchase Option does not have a readily determinable fair value. The fair value was estimated using the Black-Scholes model and was based on unobservable inputs for which there is little or no market information available. As such, we were required to develop assumptions to estimate the fair value of the Onera Purchase Option as follows (dollars in thousands):



Exercise price	$	8,206
First option exercise date (1)	10/1/2024
Expected volatility	52.20		%
Risk free rate	4.15		%
Expected annualized equity dividend yield	—		%

(1)The first option exercise date is the date used for estimating the fair value of the purchase option. The Onera Purchase Option became exercisable in September 2024 when construction of the lodging development was complete, and the property was open for business.

NOTE 11 - COMMITMENTS AND CONTINGENCIES

Franchise Agreements

All of our lodging properties (with the exception of the Onera Joint Venture property and the Nordic Lodge - Steamboat Springs, CO) operate under franchise agreements with major hotel franchisors. The initial terms of our franchise agreements generally range from 10 to 30 years with various extension provisions. Each franchisor receives franchise fees ranging from 3% to 6% of each lodging property’s room revenue, and some agreements require that we pay marketing fees of up to 4% of room revenue. In addition, some of these franchise agreements require that we deposit into a reserve fund for capital expenditures up to 5% of the lodging property's gross room revenue to ensure that we comply with the franchisor's standards and requirements. We also pay fees to our franchisors for services related to reservation and information systems. We expensed fees related to our franchise agreements of $15.0 million and $14.2 million for the three months ended June 30, 2025 and 2024, respectively, and $28.8 million and $27.6 million for the six months ended June 30, 2025 and 2024, respectively.

Management Agreements

Our lodging properties operate pursuant to management agreements with various professional third-party management companies. The remaining terms of our management agreements range from month-to-month to 12 years and have various extension provisions. Each management company receives a base management fee, which is a percentage of total lodging property revenues. In addition, our lodging property management agreements generally provide that the lodging property manager can earn an incentive fee for hotel-level Earnings Before Interest, Taxes, Depreciation and Amortization over certain thresholds of a required investment return. In some cases, there are also monthly fees for certain services, such as accounting and shared services, based on the number of guestrooms. Generally, there are also incentive fees payable to our property managers based on attaining certain financial thresholds at lodging properties under their management. Management fee expenses were $4.4 million for each of the three months ended June 30, 2025 and 2024, respectively, and $8.9 million and $9.3 million for the six months ended June 30, 2025 and 2024, respectively.

Litigation

We are involved from time to time in litigation arising in the ordinary course of business. There are currently no pending legal actions that we believe would have a material effect on our consolidated financial position or results of operations.

NOTE 12 - EQUITY-BASED COMPENSATION

Our 2024 Equity Incentive Plan, which became effective May 22, 2024, and previously, the 2011 Equity Incentive Plan (collectively, the “Equity Plan”), provides for the grant of stock options, stock appreciation rights, restricted stock, restricted stock units, dividend equivalent rights, and other stock-based awards.

Stock options granted may be either incentive stock options or non-qualified stock options. Vesting terms may vary with each grant. At June 30, 2025, we only have outstanding restricted stock awards. All of our outstanding equity-based awards are classified as equity awards.

Time-Based Restricted Stock Awards Made Pursuant to Our Equity Plan

The following table summarizes time-based restricted stock award activity under our Equity Plan:


	Number of Shares	Weighted-Average Grant Date Fair Value		Aggregate Current Value
		(per share)		(in thousands)
Non-vested at December 31, 2024	1,152,823	$	7.28	$	7,897
Granted	693,020	6.63
Vested	(399,938)	8.14
Forfeited	(30,673)	6.67
Non-vested at June 30, 2025	1,415,232	$	6.73	$	7,204

The awards vest over a three-year period based on continuous service (25% on the first and second anniversary of the grant date and 50% on the third anniversary of the grant date).

The awards granted to our executive officers generally vest over a three-year period based on continuous service (25% on the first and second anniversary of the grant date and 50% on the third anniversary of the grant date) or in certain circumstances upon a change in control.

The holders of these time-based restricted stock awards have the right to vote their unvested restricted shares of Common Stock and receive all dividends declared and paid whether or not vested. The fair value of time-based restricted stock awards granted is calculated based on the market value of our Common Stock on the date of grant.

Performance-Based Restricted Stock Awards Made Pursuant to Our Equity Plan

The following table summarizes performance-based restricted stock activity under the Equity Plan:


	Number of Shares	Weighted-Average Grant Date Fair Value (1)		Aggregate Current Value
		(per share)		(in thousands)
Non-vested at December 31, 2024	1,239,748	$	9.53	$	8,492
Granted	576,475	7.66
Vested	(154,397)	12.26
Forfeited	(152,038)	12.26
Non-vested at June 30, 2025	1,509,788	$	8.26	$	7,685

(1) Amounts represent the expected future value of the performance-based restricted stock awards calculated using the Monte Carlo simulation valuation model.

Our performance-based restricted stock awards are market-based awards and are accounted for based on the fair value of our Common Stock on the grant date. The fair value of the performance-based restricted stock awards granted was estimated using a Monte Carlo simulation valuation model. These awards generally vest over a three-year period based on our total shareholder return relative to the total shareholder return of certain companies within the Dow Jones U.S. Hotels Index (or in the event such index is discontinued, or its methodology significantly changed, a comparable index selected by the Compensation Committee of the Board of Directors) at the end of the period or upon a change in control. The awards require continued service during the measurement period, except in the case of certain terminations of employment or in the case of a change in control and are subject to the other conditions described in the Equity Plan or award document.

The number of shares the executive officers may earn under these awards range from zero shares to twice the number of shares granted based on our percentile ranking within the Index at the end of the performance period. In addition, a portion of the performance-based shares may be earned based on the Company's absolute total shareholder return calculated during the performance period.

The holders of these performance-based restricted stock awards have the right to vote their unvested restricted shares of Common Stock, and any dividends declared accrue and will be subject to the same vesting conditions as the performance awards. Further, if additional shares are earned based on our percentile ranking within the index, dividends will be paid as if the additional shares had been held throughout the entire performance period.

Equity-Based Compensation Expense

Equity-based compensation expense included in Corporate general and administrative expenses on the Condensed Consolidated Statements of Operations is as follows (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Time-based restricted stock	$	982	$	618	$	1,909	$	1,488
Performance-based restricted stock	1,031		1,250		2,020		2,228
Director stock (1)	776		767		776		767
	$	2,789	$	2,635	$	4,705	$	4,483

(1) Represents annual stock awards to members of our Board of Directors that vest immediately upon grant.

We recognize equity-based compensation expense ratably over the vesting periods. The amount of expense may be subject to adjustment in future periods due to forfeitures of time-based restricted stock.

Unrecognized equity-based compensation expense for all non-vested awards pursuant to our Equity Plan was $14.4 million at June 30, 2025 and will be recorded as follows (in thousands):


	Total		2025		2026		2027		2028
Time-based restricted stock	$	7,341	$	2,028	$	3,166	$	1,886	$	261
Performance-based restricted stock	7,043		2,091		2,982		1,697		273
	$	14,384	$	4,119	$	6,148	$	3,583	$	534

NOTE 13 - INCOME TAXES

We have elected to be taxed as a REIT. As a REIT, we are generally not subject to corporate-level income taxes on taxable income we distribute to our stockholders.

Income related to our TRS Lessees is subject to federal, state, and local taxes at applicable corporate tax rates. Our consolidated tax provision includes the income tax provision related to the operations of the TRS Lessees as well as state and local income taxes related to the Operating Partnership. For the three and six months ended June 30, 2025, we have utilized the discrete effective tax rate method under ASC No. 740, Income Taxes—Interim Reporting to calculate our interim income tax provision. We have historically calculated the provision for income taxes during interim reporting periods by applying an estimate of the annual effective tax rate for the full year to ordinary income (loss) for the reporting period.

We consider all available evidence, both positive and negative, to determine whether, based on the weight of that evidence, a valuation allowance for deferred tax assets is needed. Certain of our TRS Lessees have incurred operating losses in the past and the realizability of certain of our deferred tax assets as of June 30, 2025 is not reasonably assured. Therefore, we have recorded a valuation allowance of $2.2 million against a portion of our deferred tax assets at June 30, 2025. We may reverse the valuation allowance in the future as additional evidence becomes available to support the realizability of the deferred tax assets.

We file U.S. and state income tax returns in jurisdictions with varying statutes of limitations. In general, we are not subject to tax examinations by tax authorities for years before 2022. In the normal course of business, we are subject to examination by federal, state, and local jurisdictions where applicable. We had no unrecognized tax benefits at June 30, 2025. We expect no significant increase or decrease in unrecognized tax benefits due to changes in tax positions within the next year.

NOTE 14 - EARNINGS PER SHARE

The following is a summary of the components used to calculate basic and diluted earnings per share (in thousands, except per share amounts):


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Numerator:
Net income	$	2,037	$	38,698	$	2,660	$	41,531
Adjusted for:
Distributions to and accretion of redeemable non-controlling interests	(657)		(657)		(1,314)		(1,314)
Preferred dividends	(3,968)		(3,968)		(7,938)		(7,938)
(Income) loss from non-controlling interests in joint ventures	769		1,375		(514)		737
Dividends paid on unvested time-based restricted stock	(117)		(88)		(210)		(140)
Allocation of loss (income) to participating securities	210		(4,822)		782		(4,412)
Numerator for (loss) income per common stockholder - basic	(1,726)		30,538		(6,534)		28,464
Adjusted for:

Allocation of income to participating securities (1)	—		3,533		—		2,180
Numerator for (loss) income per common stockholder - diluted	$	(1,726)	$	34,071	$	(6,534)	$	30,644

Denominator:
Weighted average common shares outstanding - basic	107,633		105,918		107,820		105,819
Adjusted for:
Dilutive effect of equity-based compensation awards	—		1,968		—		1,896
Effect of assumed conversion of convertible debt	—		25,617		—		25,448
Effect of assumed conversion of Operating Partnership units	—		15,948		—		15,949
Weighted average common shares outstanding - diluted	107,633		149,451		107,820		149,112

Net (loss) income per share available to common stockholders:
Basic	$	(0.02)	$	0.29	$	(0.06)	$	0.27
Diluted	$	(0.02)	$	0.23	$	(0.06)	$	0.21

(1) Balances reflect potentially dilutive securities issuable based on the estimated vesting of performance-based restricted stock assuming that the reporting date is the vesting date and unvested time-based restricted stock using the treasury stock method. These shares were not included for the three and six months ending June 30, 2025 since their inclusion would have been anti-dilutive.

NOTE 15 - SUPPLEMENTAL CASH FLOW INFORMATION

We consider all highly liquid investments with an original maturity of three months or less to be cash equivalents. Restricted cash consists of certain funds maintained in escrow for property taxes, insurance, and certain capital expenditures. Funds may be disbursed from the account upon proof of expenditures and approval from the lender or other party requiring the restricted cash reserves.

Supplemental cash flow information is as follows (in thousands):


	Six Months Ended June 30,
	2025		2024

Cash payments for interest	$	37,908	$	42,619

Accrued improvements to lodging properties	$	8,101	$	10,054

Cash payments for income taxes, net of refunds	$	1,099	$	1,377
Accrued and unpaid dividends on unvested performance-based restricted stock	$	522	$	44

NOTE 16 - SEGMENT INFORMATION

We have investments in lodging properties located in 25 states of the USA. Our lodging properties derive revenue primarily from guestroom sales, food and beverage sales, and revenues from other lodging services and amenities. Our President and Chief Executive Officer, who serves as our Chief Operating Decision Maker, evaluates the performance, makes capital allocation decisions, and manages the overall operating and investing strategy of each hotel individually. As such, we consider each lodging property to be an operating segment. Each of our properties has similar economic characteristics and risks, facilities, and services and distribute their products and services in the same manner through third-party management companies. Therefore, all of our lodging properties are aggregated into a single reportable segment. The accounting policies of the lodging property segment are the same as those described in “Note 2 - Basis of Presentation and Significant Accounting Policies” to the Condensed Consolidated Financial Statements. Our measure of segment assets is total assets as reported on our Condensed Consolidated Balance Sheets.

On a regular basis, the segment's performance is assessed, and decisions are made related to the allocation of resources primarily based on lodging property earnings before interest, taxes, depreciation and amortization (“Hotel EBITDA”) by comparing Hotel EBITDA results to budgets and forecasts, prior period results, and industry or peer group benchmarks. Additionally, the CODM considers other performance metrics such as total revenue, revenue per available room (“RevPAR”), average daily rate (“ADR”), occupancy, and hotel gross operating profit to assess operating performance.

Lodging revenues and Hotel EBITDA, including significant lodging expenses for our single reportable operating segment, are as follows (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Lodging property revenues:
Room	$	170,599	$	173,025	$	334,330	$	340,456
Food and beverage	11,195		10,069		22,185		20,902
Other	11,123		10,809		20,880		20,687
Total revenues	192,917		193,903		377,395		382,045

Lodging property expenses:
Room	39,166		38,044		75,298		74,017
Sales and marketing	24,807		24,738		48,557		48,241
Administrative and general	14,833		14,707		29,328		29,156
Property taxes, insurance and other	13,706		13,287		27,017		27,572
Food and beverage	8,388		7,639		16,379		15,841
Property operations & maintenance	8,256		7,410		16,077		15,040
Utility costs	6,931		6,309		13,969		12,941
Management fees	4,411		4,434		8,906		9,331
Other lodging property expenses	4,116		4,306		7,934		8,353
Total lodging property expenses	124,614		120,874		243,465		240,492
Hotel EBITDA	$	68,303	$	73,029	$	133,930	$	141,553

A reconciliation of Income from continuing operations before income taxes as shown on our Condensed Consolidated Statements of Operations to Hotel EBITDA is as follows (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Income from continuing operations before income taxes	$	3,215	$	41,073	$	4,592	$	44,123
Adjusted for:
Depreciation and amortization	37,259		36,458		74,489		73,257
Corporate general and administrative	8,280		8,704		16,851		17,015



Loss (gain) on disposal of assets, net	80		(28,342)		79		(28,417)
Interest expense	20,628		20,830		40,584		42,412
Interest income	(301)		(565)		(577)		(1,023)
Gain on extinguishment of debt	—		(3,000)		—		(3,000)
Other income, net	(858)		(2,129)		(2,088)		(2,814)
Hotel EBITDA	$	68,303	$	73,029	$	133,930	$	141,553

NOTE 17 - SUBSEQUENT EVENTS

Dividends

On August 1, 2025, our Board of Directors declared quarterly cash dividends and distributions of $0.08 per share on our Common Stock and per Common Unit of the Operating Partnership and cash dividends of $0.390625 per share of 6.25% Series E Preferred Stock and $0.3671875 per share of 5.875% Series F Preferred Stock. The Board of Directors also declared on behalf of the Operating Partnership, a cash distribution of $0.328125 per share of the Operating Partnership's unregistered 5.250% Series Z Cumulative Perpetual Preferred Units. The dividends and distributions are payable on August 29, 2025 to holders of record as of August 15, 2025.

Debt Refinancing

PART I - FINANCIAL INFORMATION

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Management’s Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with our audited Consolidated Financial Statements and Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Form 10-K for the year ended December 31, 2024, and our unaudited Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q.

Unless stated otherwise or the context otherwise requires, references in this report to “we,” “our,” “us,” “our company” or “the company” mean Summit Hotel Properties, Inc. and its consolidated subsidiaries.

Cautionary Statement about Forward-Looking Statements

This report contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and include this statement for purposes of complying with these safe harbor provisions. Forward-looking statements, which are based on certain assumptions and describe our future plans, strategies and expectations, are generally identifiable by use of the words “may,” “could,” “expect,” “intend,” “plan,” “seek,” “anticipate,” “believe,” “estimate,” “predict,” “forecast,” “project,” “potential,” “continue,” “likely,” “will,” “would” or similar expressions. Forward-looking statements in this report include, among others, statements about our business strategy, including acquisition and development strategies, industry trends, estimated revenues and expenses, ability to realize deferred tax assets and expected liquidity needs and sources (including capital expenditures and the ability to obtain financing or raise capital). You should not rely on forward-looking statements since they involve known and unknown risks, uncertainties and other factors that are, in some cases, beyond our control and which could materially affect actual results, performance or achievements. Factors that may cause actual results to differ materially from current expectations include, but are not limited to:

•global, national, regional and local economic and geopolitical conditions and events, including wars or potential hostilities, such as future terrorist attacks, that may negatively affect business transient, group and other travel or consumer behavior;

•changes in federal or state regulations or policies, such as the effect of significantly increased tariffs or retaliatory responses to increased tariffs, that could affect our business;

•macroeconomic conditions related to, and our ability to manage, inflationary pressures for commodities, labor and other costs of our business;

•consumer purchasing power and overall behavior, or a potential recessionary environment, which could adversely affect our costs, liquidity, consumer confidence, and demand for travel and lodging;

•levels of spending for business and leisure travel;

•adverse changes in occupancy, average daily rate (“ADR”) and revenue per available room (“RevPAR”) and other lodging property operating metrics;

•potential changes in operations, including as a result of new regulations or changes in brand standards;

•financing risks, including the risk of leverage and the corresponding risk of default on our existing indebtedness and potential inability to refinance or extend the maturities of our existing indebtedness;

•effects of infectious disease outbreaks or pandemics;

•default by borrowers to which we lend or provide seller financing;

•supply and demand factors in our markets or sub-markets;

•the effect of alternative accommodations on our business;

•financial condition of, and our relationships with, third-party property managers and franchisors;

•the degree and nature of our competition;

•increased interest rates or continued high rates of interest;

•increased renovation costs, which may cause actual renovation costs to exceed our current estimates;

•supply-chain disruption, which may reduce access to operating supplies or construction materials and increase related costs;

•changes in zoning laws;

•significant increases in the cost of real property taxes;

•significant increases in insurance costs or availability;

•risks associated with lodging property acquisitions, including the ability to ramp up and stabilize newly acquired lodging properties with limited or no operating history or that require substantial amounts of capital improvements for us to earn economic returns consistent with our expectations at the time of acquisition;

•risks associated with dispositions of lodging properties, including our ability to successfully complete the sale of lodging properties under contract to be sold, including the risk that the purchaser may not have access to the capital needed to complete the purchase;

•the nature of our structure and transactions such that our federal and state taxes are complex and there is risk of successful challenges to our tax positions by the Internal Revenue Service (“IRS”) or other federal and state taxing authorities;

•availability of and the abilities of our property managers and us to retain qualified personnel at our lodging property and corporate offices;

•our failure to maintain our qualification as a real estate investment trust (“REIT”) under the Internal Revenue Code of 1986, as amended (the “IRC”);

•changes in our business or investment strategy;

•availability, terms and deployment of capital;

•general volatility of the capital markets and the market price of our common stock;

•environmental uncertainties and risks related to natural disasters;

•our ability to recover fully under third-party indemnities or our existing insurance policies for insurable losses and our ability to maintain adequate or full replacement cost “all-risk” property insurance policies on our properties on commercially reasonable terms;

•the effect of a data breach or significant disruption of property operator information technology networks as a result of cyber-attacks that are greater than insurance coverages or indemnities from service providers;

•our ability to manage rapidly advancing artificial intelligence technology related to our business;

•our ability to effectively manage our joint ventures with our joint venture partners;

•current and future changes to the IRC;

•our ability to continue to maintain an effective corporate responsibility program;

•our ability to successfully execute our share repurchase program or implement future share repurchase programs;

•the announced share repurchase program may not result in the full authorized amount being expended to repurchase shares of our common stock and could affect our share price and volatility; and

•the other factors discussed under the heading “Risk Factors” included in our Annual Report on Form 10-K for the year ended December 31, 2024.

Accordingly, there is no assurance that our expectations will be realized. Except as otherwise required by the federal securities laws, we disclaim any obligation or undertaking to publicly release any updates or revisions to any forward-looking statement contained herein (or elsewhere) to reflect any change in our expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.

Overview

Summit Hotel Properties, Inc. is a self-managed lodging property investment company that was organized in June 2010 and completed its initial public offering in February 2011. We focus on owning lodging properties with efficient operating models that generate strong margins and investment returns. Our lodging properties are typically located in markets with multiple demand generators such as corporate offices and headquarters, retail centers, airports, state capitols, convention centers, and leisure attractions. Substantially all of our assets are held by, and all of our operations are conducted through, our operating partnership, Summit Hotel OP, LP (the “Operating Partnership”). Through a wholly-owned subsidiary, we are the sole general partner of the Operating Partnership. At June 30, 2025, we owned, directly and indirectly, approximately 89% of the Operating Partnership’s issued and outstanding common units of limited partnership interest (“Common Units”), and all of the Operating Partnership’s issued and outstanding 6.25% Series E and 5.875% Series F preferred units of limited partnership interest. NewcrestImage Holdings, LLC and NewcrestImage Holdings II, LLC own all of the issued and outstanding 5.25% Series Z Cumulative Perpetual Preferred Units of the Operating Partnership (“Series Z Preferred Units”), which was issued as part of the NCI Transaction (as defined in “Note 5 -Debt” to the accompanying Condensed Consolidated Financial Statements). We collectively refer to preferred units of limited partnership interests of our Operating Partnership as “Preferred Units.”

At June 30, 2025, our portfolio consisted of 97 lodging properties with a total of 14,577 guestrooms located in 25 states of the United States of America. We own our lodging properties in fee simple, except for seven lodging properties which are subject to ground leases or subleases. As of June 30, 2025, we own 100% of the outstanding equity interests in 53 of the 97 lodging properties. We own a 51% controlling interest in 41 lodging properties through a joint venture that was formed in July 2019 with USFI G-Peak, Ltd. (“GIC”), a private limited company incorporated in the Republic of Singapore (the “GIC Joint Venture”). We also own 90% equity interests in two separate joint ventures (the “Brickell Joint Venture” and the “Onera Joint Venture”). The Brickell Joint Venture owns two lodging properties, and the Onera Joint Venture owns one lodging property.

Our hotel properties primarily operate under premium franchise brands owned by Marriott® International, Inc. (“Marriott”), Hilton® Worldwide (“Hilton”), Hyatt® Hotels Corporation (“Hyatt”) and InterContinental® Hotels Group (“IHG”). We also own two independent lodging properties.

We have elected to be taxed as a REIT for federal income tax purposes commencing with our short taxable year ended December 31, 2011. To qualify as a REIT, we cannot operate or manage our lodging properties. Accordingly, all of our lodging properties are leased to our taxable REIT subsidiaries (“TRS Lessees” or “TRSs”). All of our lodging properties are operated pursuant to lodging property management agreements between our TRS Lessees and professional, third-party lodging property management companies that are not affiliated with us as follows:


Management Company	Number of Properties	Number of Guestrooms
Affiliates of Aimbridge Hospitality, LLC	50	7,525
OTO Development, LLC	11	1,560

Affiliates of Magna Hospitality Group, L.C.	10	1,619
Stonebridge Realty Advisors, Inc. and affiliates	7	1,042
Crestline Hotels & Resorts, LLC	7	926
Affiliates of Marriott, including Courtyard Management Corporation, SpringHill SMC Corporation and Residence Inn by Marriott, Inc.	4	563
White Lodging Services Corporation	2	453
Hersha Hospitality Management	2	338




Concord Hospitality Enterprises Company, LLC (1)	2	264
InterContinental Hotel Group Resources, Inc., an affiliate of IHG	1	252
Blink Data Services, LLC	1	35
Total	97	14,577

(1) Effective July 1, 2025, Concord Hospitality Enterprises Company, LLC was replaced with MIA Hospitality Management, LLC.

Our typical lodging property management agreement requires us to pay a base fee to our lodging property manager calculated as a percentage of lodging property revenues. In addition, our typical lodging property management agreements generally provide that the lodging property manager can earn an incentive fee for hotel-level Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”) over certain thresholds of a required investment return to us. Our TRS Lessees may employ other lodging property managers in the future. We currently do not have any ownership or economic interest in any of the lodging property management companies engaged by our TRS Lessees. However, we have a purchase option to acquire a 10% to 15% equity interest in the entity that owns the Onera brand, which is an affiliate of Blink Data Services, LLC, if we reach certain investment thresholds in Onera-branded properties.

Our revenues are derived from lodging property operations and consist of room revenue, food and beverage revenue and other lodging property operations revenue. Revenues from our other lodging property operations consist of ancillary revenues related to parking, cancellation fees, meeting rooms and other guest services provided at certain of our lodging properties.

Recent Developments

On April 29, 2025, our Board of Directors authorized the repurchase of up to $50 million of our common stock (the “2025 Share Repurchase Program”). Repurchases may be made from time to time at management’s discretion, at prices management considers to be attractive, through open market purchases, subject to availability. Open market purchases will be conducted in accordance with the limitations set forth in Rule 10b-18 of the Exchange Act, and other applicable legal requirements. We have no obligation to repurchase any shares under the program, and the timing, actual number and value of the shares that are repurchased, if any, are at the discretion of management. The 2025 Share Repurchase Program does not have an expiration date.

During the six months ended June 30, 2025, the Company repurchased 3,585,179 shares of our Common Stock under the 2025 Share Repurchase Program for an aggregate purchase price and commissions of $15.4 million, or an average of approximately $4.30 per share. As of June 30, 2025, approximately $34.6 million remained available for repurchase under the 2025 Stock Repurchase Program.

Industry Trends and Outlook

Room-night demand in the U.S. lodging industry is generally correlated to certain macroeconomic trends. Key drivers of demand, and therefore lodging revenues, include changes in gross domestic product, corporate profits, capital investments, employment, and consumer and corporate sentiment. From a cost perspective, elevated inflation increased the cost of salaries, wages, supplies, material, freight, insurance and energy in recent years. A portion of these costs were partially offset by increases in average rates for lodging properties. Expense growth has moderated to a pace consistent with historical long-term inflation rates; however, certain costs remain above historical levels and could be further affected by changes in tariff policies and agreements.

During the six months ended June 30, 2025, we experienced a modest same-store revenue decline resulting primarily from a reduction in government-related and inbound international travel. Recent policy changes, including tariff policies, as well as continued concerns related to inflationary pressures, have created macroeconomic uncertainty which has had a negative effect on consumer and corporate sentiment and spending. This has resulted in modest near-term pricing pressure in certain demand segments. The medium- and long-term outlook for the industry remains favorable as forecasted room night demand growth and increases in average daily rate, coupled with minimal supply growth, are expected to drive industry RevPAR growth over the next several years.

Our Lodging Property Portfolio

According to current chain scales as defined by STR Global (“STR”), as of June 30, 2025, six of our lodging properties with a total of 953 guestrooms are categorized as Upper-upscale hotels, 74 of our lodging properties with a total of 11,296 guestrooms are categorized as Upscale hotels and 15 of our lodging properties with a total of 2,248 guestrooms are categorized as Upper-midscale hotels. We have two independent lodging properties that are not categorized by STR. Lodging property information at June 30, 2025 is as follows:


Franchise/Brand	Number of Lodging Properties	Number of Guestrooms
Marriott
Courtyard by Marriott	16	2,848
Residence Inn by Marriott	16	2,256
AC Hotel by Marriott	6	1,026
SpringHill Suites by Marriott	6	775
TownePlace Suites	2	225
Marriott	1	165
Fairfield Inn & Suites by Marriott	1	140
Element by Marriott	1	108

Total Marriott	49	7,543
Hilton
Hilton Garden Inn	8	1,224
Hampton Inn & Suites	8	1,162
Homewood Suites	3	369
Embassy Suites	2	346
Canopy Hotel	2	326
Hampton Inn	1	250
DoubleTree by Hilton	1	210
Total Hilton	25	3,887
Hyatt
Hyatt Place	13	1,893
Hyatt House	3	466
Total Hyatt	16	2,359
IHG
Holiday Inn Express & Suites	3	471

Staybridge Suites	1	121
Hotel Indigo	1	116
Total IHG	5	708
Independent
Nordic Lodge	1	45
Onera	1	35
Total Independent	2	80
Total	97	14,577

Lodging Property Portfolio Activity

We continually evaluate alternatives to refine our portfolio to drive growth and create value. In the normal course of business, we evaluate opportunities to acquire additional properties that meet our investment criteria and opportunities to recycle capital through the disposition of properties. As such, the composition and size of our portfolio of properties may change materially over time. Significant changes to our portfolio of properties could have a material effect on our Condensed Consolidated Financial Statements.

See “Note 3 - Investments in Lodging Property, net” to the Condensed Consolidated Financial Statements for further information related to lodging property acquisitions and dispositions.

Results of Operations

The comparisons that follow should be reviewed in conjunction with the unaudited Condensed Consolidated Financial Statements included elsewhere in this Quarterly Report on Form 10-Q.

Comparison of the Three Months Ended June 30, 2025 with the Three Months Ended June 30, 2024

The following table contains key operating metrics for our portfolio for the three months ended June 30, 2025 compared with the three months ended June 30, 2024 (dollars in thousands, except ADR and RevPAR).


	Three Months Ended June 30,												Quarter-over-Quarter				Quarter-over-Quarter
	2025						2024						Dollar Change				Percentage Change
	Total Portfolio (97 properties)			Same-Store (1) Portfolio (95 properties)			Total Portfolio (96 properties)			Same-Store Portfolio (95 properties)			Total Portfolio (97/96 properties)		Same-Store Portfolio (95 properties)		Total Portfolio (97/96 properties)		Same-Store Portfolio (95 properties)
Revenues:
Room	$	170,599		$	164,992		$	173,025		$	171,173		$	(2,426)	$	(6,181)	(1.4)	%	(3.6)	%
Food and beverage	11,195			11,002			10,069			10,020			1,126		982		11.2	%	9.8	%
Other	11,123			10,951			10,809			10,689			314		262		2.9	%	2.5	%
Total	$	192,917		$	186,945		$	193,903		$	191,882		$	(986)	$	(4,937)	(0.5)	%	(2.6)	%

Expenses:
Room	$	39,166		$	38,115		$	38,044		$	37,464		$	1,122	$	651	2.9	%	1.7	%
Food and beverage	8,388			8,228			7,639			7,585			749		643		9.8	%	8.5	%
Other lodging property operating expenses	58,943			57,103			57,470			56,280			1,473		823		2.6	%	1.5	%
Total	$	106,497		$	103,446		$	103,153		$	101,329		$	3,344	$	2,117	3.2	%	2.1	%

Operational Statistics:
Occupancy	77.7		%	77.6		%	77.7		%	77.9		%	n/a		n/a		—	%	(0.4)	%
ADR	$	165.70		$	165.04		$	170.49		$	170.60		$	(4.79)	$	(5.56)	(2.8)	%	(3.3)	%
RevPAR	$	128.79		$	128.07		$	132.41		$	132.89		$	(3.62)	$	(4.82)	(2.7)	%	(3.6)	%

(1) Same-store information includes operating results for 95 hotels owned by the Company as of January 1, 2024, and at all times during the three months ended June 30, 2025, and 2024.

The portfolio information above for the three months ended June 30, 2025 and 2024 reflects operating results for various portions of each period for certain lodging properties as a result of the acquisition and sales of lodging properties. The following table details how the acquisition and disposition transactions affect each reporting period:

Portion of Operating Results Included

For the Three Months Ended

Transaction

June 30,

Date

2025

2024

Sold Properties:

(Total Portfolio)

Four Points by Marriott - San Francisco (Airport), CA

October 2024

None

Full Period

Courtyard by Marriott and SpringHill Suites - New Orleans, LA

April 2024

None

Partial Period

Hilton Garden Inn - College Station, TX

April 2024

None

Partial Period

Acquired Properties:

Hampton Inn - Revere (Boston), MA

December 2024

Full Period

None

Hilton Garden Inn - Tysons Corner (Vienna), WA

December 2024

Full Period

None

Changes from the three months ended June 30, 2025 compared with the three months ended June 30, 2024 were due to the following:

•Revenues and RevPAR. Room revenues for our total portfolio during the second quarter of 2025 compared with the second quarter of 2024 decreased by $2.4 million as a result of a $6.2 million decrease in same-store revenues driven by reduced government-related and inbound international travel, partially offset by a $3.8 million increase in room revenues due to the net effect of the acquisition of two lodging properties (the "2024 Acquired Properties") and the sale of four lodging properties (the "2024 Partial Year Sold Properties").

Occupancy was flat and ADR decreased by 2.8% for the total portfolio during the second quarter of 2025, which resulted in a 2.7% decrease in RevPAR. On a same-store basis, we experienced a decrease of 0.4% in occupancy and a 3.3% decrease in ADR during the second quarter of 2025. This resulted in a decrease in same-store RevPAR of 3.6% for the second quarter of 2025. The declines in ADR were driven by a modest shift in mix towards lower rated demand segments.

•Room Expenses. Room expenses for our total portfolio for the second quarter of 2025 compared with the second quarter of 2024 increased $1.1 million as a result of a $0.7 million increase in same-store room expenses primarily driven by an increase in labor and benefits expenses, and a $0.4 million increase in room expenses due to the net effect of the acquisition of the 2024 Acquired Properties and the sale of the 2024 Partial Year Sold Properties.

•Food and Beverage Revenues and Expenses. Total portfolio food and beverage revenues increased $1.1 million for the second quarter of 2025 compared with the second quarter of 2024 primarily due to a $1.0 million increase in same-store food and beverage revenues driven by the modification of certain breakfast programs and special events. Total portfolio food and beverage expenses increased by $0.7 million as a result of a $0.6 million increase in same-store food and beverage expenses primarily to support the increase in food and beverage revenues.

•Other Lodging Property Operating Revenues and Expenses. Other lodging property operating revenues for our total portfolio during the second quarter of 2025 compared with the second quarter of 2024 increased $0.3 million primarily due to an increase in same-store parking and resort fees.

The $1.5 million increase in other lodging property operating expenses for the total portfolio for the three months ended June 30, 2025 in comparison with the three months ended June 30, 2024 was attributable to a $0.8 million increase in same-store other lodging property operating expenses combined with a $0.7 million increase due to the net effect of the acquisition of the 2024 Acquired Properties and the sale of the 2024 Partial Year Sold Properties. The same-store increase was driven by increased labor costs, maintenance costs, and utilities.

The following table includes other consolidated income and expenses for the three months ended June 30, 2025 compared with the three months ended June 30, 2024 (dollars in thousands):


	Three Months Ended June 30,
	2025		2024		Dollar Change		Percentage Change
Property taxes, insurance and other	$	13,706	$	13,287	$	419	3.2	%
Management fees	4,411		4,434		(23)		(0.5)	%
Depreciation and amortization	37,259		36,458		801		2.2	%
Corporate general and administrative	8,280		8,704		(424)		(4.9)	%



(Loss) gain on disposal of assets, net	(80)		28,342		(28,422)		nm¹
Interest expense	20,628		20,830		(202)		(1.0)	%
Interest income	301		565		(264)		(46.7)	%

Gain on extinguishment of debt	—		3,000		(3,000)		nm¹
Other income, net	858		2,129		(1,271)		(59.7)	%
Income tax expense	1,178		2,375		(1,197)		(50.4)	%

¹ Not meaningful.

Changes for the three months ended June 30, 2025 compared with the three months ended June 30, 2024 were due to the following:

•Property Taxes, Insurance and Other. The increase in Property taxes, insurance and other during the three months ended June 30, 2025 is primarily due to a $0.6 million increase in property taxes, partially offset by a $0.3 million decrease in insurance premiums, combined with a $0.1 million increase from the net effect of the acquisition of the 2024 Acquired Properties and the sale of the 2024 Partial Year Sold Properties.

•Management Fees. Management fees decreased slightly during the three months ended June 30, 2025 primarily due to lower same-store revenues for the period.

•Depreciation and Amortization. Depreciation and amortization increased by $0.8 million during the three months ended June 30, 2025 compared to the three months ended June 30, 2024, primarily due to an increase of $1.1 million in depreciation and amortization as a result of the net effect of the acquisition of the 2024 Acquired Properties and the sale of the 2024 Partial Year Sold Properties, partially offset by a $0.3 million decrease in same-store depreciation and amortization, as the reduction from fully depreciated assets exceeded the depreciation of assets placed in service as a result of completed renovations.

•Corporate General and Administrative. Corporate general and administrative expenses decreased by $0.4 million during the three months ended June 30, 2025 primarily due to a decrease in corporate employee-related costs.

•(Loss) Gain on Disposal of Assets, net. (Loss) Gain on disposal of assets, net of $28.3 million for the three months ended June 30, 2024 was primarily the result of a $28.3 million gain recorded on the sale of a portfolio of two lodging properties in New Orleans, LA during the three months ended June 30, 2024.

•Interest Expense. Interest expense decreased by $0.2 million during the three months ended June 30, 2025 primarily due to lower average interest rates during the period, partially offset by an increase in the average debt outstanding during the three months ended June 30, 2025 compared to the same period of the prior year.

•Interest Income. Interest income decreased by $0.3 million during the three months ended June 30, 2025 due to non-cash interest income related to the amortization of the Onera Purchase Option recorded during the three months ended June 30, 2024, which was fully amortized in September 2024, combined with a decrease related to interest earned on money market accounts during the comparable three-month periods.

•Gain on Extinguishment of Debt. The gain on extinguishment of debt for the three months ended June 30, 2024 was the result of the repayment of the MetaBank Loan (as defined in "Note 5 - Debt" to the accompanying Condensed Consolidated Financial Statements) in June 2024 prior to its scheduled maturity date, which resulted in a net gain on extinguishment of debt of $3.0 million after legal fees and unamortized debt issuance costs that were written-off on the closing date.

•Other Income, net. Other income, net for the three months ended June 30, 2025 consists primarily of $0.9 million of third-party tenant income, the realization of approximately $0.3 million of tax rebates related to the NCI Transaction during the period, partially offset by a net casualty loss of $0.4 million.

Other income, net for the three months ended June 30, 2024 consists primarily of $0.7 million of third-party tenant income, the realization of approximately $0.4 million of tax rebates related to the NCI Transaction during the period, $0.4 million in state grants awarded during the period, and net casualty income of $0.6 million.

•Income Tax Expense. The Company recorded a $1.2 million income tax expense during the three months ended June 30, 2025, which represents a decrease of $1.2 million from the same period in the previous year. Income tax expense varies based on changes in our forecasted effective tax rate over the course of the year and variability in quarterly net income (loss).

Comparison of the Six Months Ended June 30, 2025 with the Six Months Ended June 30, 2024

The following table contains key operating metrics for our portfolio for the six months ended June 30, 2025 compared with the six months ended June 30, 2024 (dollars in thousands, except ADR and RevPAR):


	Six Months Ended June 30,
	2025				2024				Dollar Change				Percentage Change
	Total Portfolio (97 properties)		Same-Store (1) Portfolio (95 properties)		Total Portfolio (96 properties)		Same-Store Portfolio (95 properties)		Total Portfolio (97/96 properties)		Same-Store Portfolio (95 properties)		Total Portfolio (97/96 properties)		Same-Store Portfolio (95 properties)
Revenues:
Room	$	334,330	$	325,851	$	340,456	$	331,421	$	(6,126)	$	(5,570)	(1.8)	%	(1.7)	%
Food and beverage	22,185		21,822		20,902		20,635		1,283		1,187		6.1	%	5.8	%
Other	20,880		20,612		20,687		20,245		193		367		0.9	%	1.8	%
Total	$	377,395	$	368,285	$	382,045	$	372,301	$	(4,650)	$	(4,016)	(1.2)	%	(1.1)	%

Summit Hotel Properties, Inc. 10-Q