Sunstone Hotel Investors, Inc. Files 2023 Annual Report on Form 10-K

TL;DR

<b>Sunstone Hotel Investors, Inc. has filed its 2023 annual report (10-K) detailing its financial performance and operational status.</b>

AI Summary

Sunstone Hotel Investors, Inc. (SHO-PI) filed a Annual Report (10-K) with the SEC on February 23, 2024. Sunstone Hotel Investors, Inc. filed its 2023 Form 10-K on February 23, 2024. The filing covers the fiscal year ending December 31, 2023. The company is classified under SIC code 7011 (Hotels & Motels). Sunstone Hotel Investors, Inc. is incorporated in Maryland. The company's principal business address is 15 Enterprise, Suite 200, Aliso Viejo, CA 92656.

Why It Matters

For investors and stakeholders tracking Sunstone Hotel Investors, Inc., this filing contains several important signals. This 10-K filing provides a comprehensive overview of Sunstone Hotel Investors' financial health, debt structure, and strategic initiatives for the fiscal year 2023, crucial for investors assessing the company's stability and future prospects. The detailed information within the filing, including financial statements and risk factors, is essential for stakeholders to understand the company's performance in the hotel and motel industry and to make informed investment decisions.

Risk Assessment

Risk Level: medium — Sunstone Hotel Investors, Inc. shows moderate risk based on this filing. The company's financial performance and outlook are subject to the inherent cyclicality and volatility of the hotel and lodging industry, which can be significantly impacted by economic conditions, travel trends, and competitive pressures.

Analyst Insight

Investors should review the detailed financial statements and risk factors in the 10-K to assess Sunstone Hotel Investors' exposure to industry-specific risks and its strategies for mitigating them.

Key Numbers

• 2023-12-31 — Fiscal Year End (Conformed period of report)
• 2024-02-23 — Filing Date (As of date)
• 7011 — SIC Code (Standard Industrial Classification)
• 001-32319 — SEC File Number (SEC file number)

Key Players & Entities

• Sunstone Hotel Investors, Inc. (company) — Filer name
• 2023-12-31 (date) — Fiscal year end
• 2024-02-23 (date) — Filing date
• 7011 (industry_code) — Standard Industrial Classification
• MD (location) — State of incorporation
• 15 Enterprise (address) — Business address street 1
• Aliso Viejo (location) — Business address city
• CA (location) — Business address state

FAQ

Risk Factors

• Industry and Economic Risks [high — market]: The company's operations are subject to the cyclical nature of the lodging industry, economic downturns, and changes in travel demand.
• Debt and Financing Risks [medium — financial]: The company's significant debt obligations and reliance on financing could impact its financial flexibility and ability to meet its obligations.
• Property-Specific Risks [medium — operational]: Risks associated with the ownership and operation of individual hotel properties, including competition, management, and capital expenditures.

Key Dates

• 2023-12-31: Fiscal Year End — Marks the end of the reporting period for the 10-K filing.
• 2024-02-23: Filing Date — Date the 10-K was officially submitted to the SEC.

Key Financial Figures

• $0.01 — nge on Which Registered Common Stock, $0.01 par value SHO New York Stock Exchan
• $493.7 m — December 31, 2023, we had total cash of $493.7 million, including $67.3 million of restr
• $67.3 million — total cash of $493.7 million, including $67.3 million of restricted cash, and access to our u
• $500.0 million — tricted cash, and access to our undrawn $500.0 million credit facility. Adjusting for the Janu
• $30.0 m — 4 dividend and distribution payments of $30.0 million, our total pro forma cash includi
• $463.7 million — d cash as of December 31, 2023 would be $463.7 million. We believe our current liquidity will

Filing Documents

• sho-20231231x10k.htm (10-K) — 4244KB
• sho-20231231xex4d5.htm (EX-4.5) — 176KB
• sho-20231231xex21d1.htm (EX-21.1) — 11KB
• sho-20231231xex23d1.htm (EX-23.1) — 10KB
• sho-20231231xex31d1.htm (EX-31.1) — 14KB
• sho-20231231xex31d2.htm (EX-31.2) — 14KB
• sho-20231231xex32d1.htm (EX-32.1) — 8KB
• sho-20231231xex97d1.htm (EX-97.1) — 53KB
• 0001558370-24-001615.txt (&nbsp;) — 17229KB
• sho-20231231.xsd (EX-101.SCH) — 74KB
• sho-20231231_cal.xml (EX-101.CAL) — 101KB
• sho-20231231_def.xml (EX-101.DEF) — 530KB
• sho-20231231_lab.xml (EX-101.LAB) — 727KB
• sho-20231231_pre.xml (EX-101.PRE) — 689KB
• sho-20231231x10k_htm.xml (XML) — 3587KB

Business

Business 3 Item 1A

Risk Factors

Risk Factors 10 Item 1B Unresolved Staff Comments 32 Item 1C Cybersecurity 32 Item 2

Properties

Properties 33 Item 3

Legal Proceedings

Legal Proceedings 33 Item 4 Mine Safety Disclosures 34 PART II Item 5 Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 34 Item 6 Reserved 35 Item 7

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 35 Item 7A

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 50 Item 8

Financial Statements and Supplementary Data

Financial Statements and Supplementary Data 51 Item 9 Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 51 Item 9A

Controls and Procedures

Controls and Procedures 51 Item 9B Other Information 53 Item 9C Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 53 PART III Item 10 Directors, Executive Officers and Corporate Governance 53 Item 11

Executive Compensation

Executive Compensation 53 Item 12

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 53 Item 13 Certain Relationships and Related Transactions, and Director Independence 53 Item 14 Principal Accountant Fees and Services 54 PART IV Item 15 Exhibit and Financial Statement Schedules 54 Item 16 Form 10-K Summary 58

SIGNATURES

SIGNATURES 59 2 Table of Contents The "Company," "we," "our," and "us" refer to Sunstone Hotel Investors, Inc., a Maryland corporation, and one or more of our subsidiaries, including Sunstone Hotel Partnership, LLC, or the Operating Partnership, and Sunstone Hotel TRS Lessee, Inc., or the TRS Lessee, and, as the context may require, Sunstone Hotel Investors only or the Operating Partnership only. SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS This report, together with other statements and information publicly disseminated by the Company, contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act. The Company intends 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 includes this statement for purposes of complying with these safe-harbor provisions. Forward-looking statements, which are based on certain assumptions and describe the Company's future plans, strategies and expectations, are generally identifiable by use of the words "anticipate," "believe," "estimate," "expect," "intend," "project" or similar expressions. You should not rely on forward-looking statements because they involve known and unknown risks, uncertainties and other factors that are, in some cases, beyond the Company's control, and which could materially affect actual results, performances or achievements. Factors that may cause actual events to differ materially from the expectations expressed or implied by any forward-looking statement include, but are not limited to the risk factors discussed in this Annual Report on Form 10-K. Accordingly, there is no assurance that the Company's expectations will be realized. Except as otherwise required by federal securities laws, the Company disclaims any obligations or undertaking to publicly release any updates or revi

Business

Business Our Company We were incorporated in Maryland on June 28, 2004. We are a real estate investment trust ("REIT"), under the Internal Revenue Code of 1986, as amended (the "Code"). As of December 31, 2023, we owned 14 hotels, comprised of 6,675 rooms, located in 6 states and in Washington, DC. Our portfolio consists of upper upscale and luxury hotels located in major convention, resort destination and urban markets. All of our hotels are operated under nationally recognized brands, except the Oceans Edge Resort & Marina, which has established itself in a resort destination market. We own hotels in major convention, urban and resort destinations that benefit from significant barriers to entry by competitors and diverse economic drivers. Our mission is to be the premier stewards of capital in the lodging industry, providing superior returns to our stockholders by investing in hotels where we can add value through capital investment, hotel repositioning and asset management. In addition, we seek to capitalize on our portfolio's embedded value and balance sheet strength to actively recycle past investments into new growth and value creation opportunities in order to deliver strong stockholder returns and superior per share net asset value growth. Our hotels are operated by third-party managers under long-term management agreements with the TRS Lessee or its subsidiaries. As of December 31, 2023, our third-party managers included: subsidiaries of Marriott International, Inc. or Marriott Hotel Services, Inc. (collectively, "Marriott"), managers of six of our hotels; Hyatt Hotels Corporation ("Hyatt"), manager of two of our hotels; and Four Seasons Hotels Limited ("Four Seasons"), Hilton Worldwide ("Hilton"), Interstate Hotels & Resorts, Inc. ("IHR") (aka Aimbridge Hospitality), Montage North America, LLC ("Montage"), Sage Hospitality Group ("Sage") and Singh Hospitality, LLC ("Singh") (aka EOS Hospitality), each a manager of one of the Company's hotels. Comp

View Full Filing

View this 10-K filing on SEC EDGAR