HPT Announces 2002 First Quarter Operating Results

May 6, 2002

NEWTON, Mass.--(BUSINESS WIRE)--May 6, 2002: Hospitality Properties Trust (NYSE: HPT) today announced its results of operations for the quarter ended March 31, 2002, as follows:

           (amounts in thousands, except per share amounts)
                                                     Quarter Ended
                                                        March 31,
                                                    2002         2001

Net income                                         $33,331     $30,088

Net income available for
 common shareholders                               $31,550     $28,307

Funds from operations ("FFO")                      $59,388     $55,999

Cash available for distribution ("CAD")            $50,725     $46,678

Common distributions                               $44,386     $39,554

Per common share amounts:
  Net income available for common
   shareholders                                    $  0.50     $  0.50

  Funds from operations ("FFO")                    $  0.95     $  0.99

  Cash available for distribution ("CAD")          $  0.81     $  0.83

  Common distributions                             $  0.71     $  0.70

  Weighted average common shares
   outstanding                                      62,520      56,495

Hospitality Properties Trust is a REIT headquartered in Newton, Massachusetts which invests in hotels. HPT currently has investments of approximately $2.7 billion in 251 hotels located in 37 states.

                                                 Quarter     Quarter
                                                  Ended       Ended
                                                 March 31,   March 31,
                                                   2002        2001
  Minimum rent                                   $58,347      $59,402
  Hotel operating revenues (1)                    18,139           --
  FF&E reserve income (2)                          5,266        6,409
  Interest income                                    182          362

  Total revenues                                  81,934       66,173

  Hotel operating expenses (1)                    11,169          --
  Interest (including amortization
   of deferred financing costs of
   $605 and $603, respectively)                   10,047       10,186
  Depreciation and amortization                   23,734       22,138
  General and administrative                       3,653        3,761

  Total expenses                                  48,603       36,085

Net income                                        33,331       30,088
Preferred distributions                            1,781        1,781

Net income available for common
 shareholders                                    $31,550      $28,307

Net income available for common
 shareholders                                     $31,550     $28,307
Add:  FF&E deposits not in net income (2)           3,439       3,859
      Depreciation and amortization                23,734      22,138
      Deferred percentage rent (3)                    665       1,695

Funds from operations ("FFO")                     $59,388     $55,999

FFO                                               $59,388     $55,999
Add:  Non-cash expenses                               985         947

Less: FF&E reserve income (1) (2)                   6,209       6,409
      FF&E deposits not in net income (2)           3,439       3,859

Cash available for distribution ("CAD")           $50,725     $46,678

Weighted average common shares outstanding         62,520      56,495

Per common share amounts:
      Net income available for common
       shareholders                               $  0.50     $  0.50
      FFO                                         $  0.95     $  0.99
      CAD                                         $  0.81     $  0.83
      Common distributions declared               $  0.71     $  0.70

(1) All of our hotels are leased to or operated by third-parties; HPT does not operate hotels. At various times during 2001, 16 of our hotels, containing 2,380 rooms, began to be operated by Marriott International under a long-term management contract; most of these hotels were previously leased to Marriott. These hotels are now leased to a 100% subsidiary of ours, as allowed by the REIT Modernization Act which became effective in 2001. Although our long-term management contract with Marriott includes security features which are similar to those under our leases, after a property begins to be operated under a management contract rather than under a lease, our consolidated revenues include hotel sales rather than rental income and our expenses include hotel operating expenses. We have agreed to this new arrangement for a total of 35 hotels, containing 5,382 rooms and expect it to begin for the remaining 19 hotels during 2002. For the 2002 first quarter, the 16 hotels leased to our subsidiary tenant generated net revenues over expenses and FF&E escrows, as follows:

First Quarter
  Hotel operating revenues                                   $18,139
   Less:  Hotel operating expenses                            11,169
   Net payments by our manager to our subsidiary tenant        6,970
   Less:  Payments made into FF&E Reserve escrows                943
$ 6,027

(2) Some of the HPT leases provide that FF&E Reserve escrows are owned by HPT. Other leases provide that FF&E Reserve escrows are owned by the tenant and HPT has a security and remainder interest in the escrow account. When HPT owns the escrow, generally accepted accounting principles require that payments into the escrow be reported as additional rent. When HPT has a security and remainder interest in the escrow account, deposits are not included in revenue but are included in FFO. CAD excludes all FF&E Reserves.

(3) The Company recognizes percentage rental income received for the first, second and third quarters in the fourth quarter. Although recognition of revenue is deferred for purposes of calculating net income, the calculations of FFO and CAD include amounts received with respect to the periods shown.

                     Hospitality Properties Trust
                       Key Property Statistics(a)

                                      1st Quarter 1st Quarter Change
                                         2002       2001
Hotel Statistics
 (34,007 rooms and 228 hotels):
Average Daily Rate ("ADR")              $84.16     $92.58    -9.1%
Occupancy                                68.9%      72.8%    -3.9 pts
Revenue per Available Room ("RevPAR")   $57.99     $67.40    -14.0%

      (a) Excludes 2 properties containing 277 rooms, not open for a
full year as of January 1, 2002.

                     Key Balance Sheet Statistics

                                       March 31, 2002    Dec. 31, 2001

Cash                                   $   32,846,000   $   38,962,000

Real Estate, at cost                   $2,632,197,000   $2,629,153,000

  Fixed rate - 8.25% Senior Notes,
    due 2005                           $  115,000,000   $  115,000,000
  Fixed rate - 7.00% Senior Notes,
    due 2008                              149,840,000      149,834,000
  Fixed rate - 8.50% Senior Notes,
    due 2009                              150,000,000      150,000,000
  Fixed rate - 9.125% Senior Notes,
    due 2010                               49,949,000       49,947,000

                                       $  464,789,000   $  464,781,000

Book Equity
  9.5% Preferred (3,000,000 shares
    outstanding)                       $   72,207,000   $   72,207,000
  Common (62,537,598 and 62,515,940
    shares outstanding)                 1,520,095,000    1,532,312,000

                                       $1,592,302,000   $1,604,519,000

Cautionary Language

The information appearing on SVC’s website includes statements which constitute forward looking statements. These forward looking statements are based upon SVC’s present intents, beliefs or expectations, but forward looking statements are not guaranteed to occur and may not occur. SVC’s actual results may differ materially from those contained in SVC’s forward looking statements. The information contained in SVC’s filings with the Securities and Exchange Commission, including under “Risk Factors" and “Warnings Concerning Forward Looking Statements” in SVC’s periodic reports and other filings, identifies important factors that could cause SVC’s actual results to differ materially from those stated in SVC’s forward looking statements. SVC’s filings with the SEC are available on the SEC’s website at www.sec.gov and are also accessible on SVC’s website at the following link: SEC Filings. You should not place undue reliance upon forward looking statements.

The documents provided in this archived section are provided for historical purposes only. The information contained in each document is accurate only as of the date each document was originally issued or such earlier date stated in those documents. Except as required by law, Service Properties Trust does not undertake any obligation to update any information contained in these documents. For current information about the company, please refer to our most recent public SEC Filings.