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Could you give us a general summary of Hersha Hospitality Trust and its function and organization today?

April 26, 2017function hersha hospitality organization summary today Trust

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Could you give us a general summary of Hersha Hospitality Trust and its function and organization today?

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Mr. Shah: Hersha Hospitality Trust is a real estate investment trust that focuses exclusively on hospitality real estate, meaning hotels. The portfolio mix is currently a mix of full and limited service hotels, but there is, by design, a very heavy concentration in the limited serve and select serve hospitality segment. We’re basically talking about 3 1/2 to 4 star assets ‘ everything from Hampton Inn by Hilton to Courtyard and Residence Inn by Marriott. That’s our sweet spot as far as asset class is concerned. Since its inception, Hersha Hospitality Trust has been focused on limited serve hospitality real estate, mainly because we find that to be the most scalable with third-party lessees. Unlike other REITs, the hotel REIT sector has to work with third- party lessees so as not to foul the income test ‘ all REIT income needs to be passive income. Because hotels have an operating business component, we have to work with lessees since a REIT is prohibited from earning operating income.