Hospitality Property Trust (HPT)

Hospitality Property Trust (HPT)

Hospitality Property Trust (HPT) is a Real Investment Trust (REIT) that owns and operates travel centers and hotels. A REIT is a company that owns and operates revenue-producing real estate such as healthcare facilities, hotels, and shopping complexes (Ambrose & Linneman, 2001). Since the 1960s, REITs have been making large-scale investments in real estate and generating income for smaller investors. HPT was founded in 1986 and is managed by the RMR Group, a real estate investment and management firm. HPT investors have benefited from better diversification by investing in various properties. Hospitality properties Trust is a travel center and lodging REIT. By 30 September 2016, the company had invested about 9 billion USD in 198 travel centers and owned 305 hotels situated in forty-five U.S. States, Canada and Puerto Rico.

Stakeholders

The main stakeholder of the HPT is the RMR Group, which undertakes all the management decisions and delivers management facilities to other REITS that are publicly owned including three other businesses that deal with real estate. Other stakeholders include the Government Properties Income Trust and select Income REIT.

Corporate Location

The corporate headquarters for HPT is Newton, which is a suburban Middlesex County city of Massachusetts. The specific street of the headquarters is 255 Washington Street.

Corporate Officers

The corporate officers comprises of the senior management headed by Murray John who has been the President and C.O.O. since 1996 (Hospitality Property Trust, 2017). Mr. Kleifges Mark is the Chief Financial Officer and Treasure while the senior vice president is Bornstein Ethan who has been at the helm since 2007. HPT’s auditing officer is Larkin Vern while its secretary is Jennifer Clark. Other officers sit at the Board of Trustees and they include John Harrington, L (Leading Independent Trustee), Donna Fraiche, and William A. Lamkin (Independent Trustees),and Adam. Portnoy and Barry Portnoy(Managing Trustees).

Brands

HPT has upscale hotels and select service hotels as its line of brands. The upscale hotels primarily serve local business travelers and are situated in the close-in outskirts of main cities nearby corporate business parks.On the other hand, select-service hotels that are categorized as limited-service class often have lesser amenities and rooms than hotels that offer full services hotels and as such are much simpler and less costly to run. Numerous travelers love their simplicity and the prices charged in select-service brandssuch as Candlewood, Courtyard, and Hyatt Place Suites.

Other businesses that Fall Under HPT

In 2001, HPT acquired four Marriott International hotels and leased its 35 Marriott-run hotels to a new ratable subsidiary (Bloomberg News, 2001). In latest years, HPT has witnessed other big investors warming up to select-service hotels that tend to provide higher incomes than full-service hotels. These investors include Blackstone Group, Clearview Capital, and Starwood Capital Groupas the top investors of select-service hotels.

Franchises

HPT has allowed several other businesses to use its brand name and operating methods to run within a certain locality that agrees to operate its business (Robaton, 2016). Through this way, HPT insulates itself from the highly volatile hotel business. HPT’s Franchises include TravelCenters of America, restaurants, and convenience stores, Five Star quality care among others.

Number of Employees

HPT has no employees. RMR and HPT’s Managing officers and Trustees provide services, which employees would otherwise provide. As of February 2015, RMR had about 400 full time workers comprising regional offices and headquarters staff as well as other personnel spread throughout the U.S.

Employee Perks

RMR grants competitive salaries including various allowances to its different categories of workers. The organization may grant its common shares to its officers and other employees under the equity compensation strategystarted in 2012. Furthermore, HPT’s Trustees receive common shares under the 2012 Plan, which is part of their yearly compensation for service as a trustee. Furthermore, RMR alongside five other companies to which it offered its services since July 2013purchased a total liability insurance policy for its directors and officers providing 10,000 USD in combined non-indemnifiable coverage (Business Wire, 2016). RMR also purchased $ 5,000 in coverage from athird party insurer another liability insurance policy for its directors and officers.

Organization

HPT is a REIT, organized under the State of Maryland laws that invest in travel related and hotel real estate. In December 2014, HPT directly and through its affiliates, owned 184 travel centers and 291 hotels. In the same year, HPT leased and let its subsidiaries to manage it. Some of these include Marriott International, Inc., Sonesta International Inc, Wyndham Hotel Group, Carlson, Morgans Hotel Group, and TravelCenters of U.S. These companies are hereinafter sometimes regarded as tenants or managers.

Development

In the next few years, HPT is set to increase its development by buying several other centers from TravelCenters LLC, which develops the properties. Nonetheless, there is restricted potential for development in the travel-center sector due to strong barriers to entry

Classification

HPT is a travel center and lodging REIT. It provides services in travels and hospitality and owns hotels and travel centers situated across Puerto Rico, the U.S., Ontario, and Canada.

Green

These days, HPT comprising its hotels, travel centers and other subsidiary are looking into environmental sustainability. The resolve to go green was initially expensive but with an elaborate plan, the trust has managed to transform, manage, and monitor its eco-activities (Eichholtz, Kok & Yonder, 2012).This has assisted the trust to focus on a particular area and to start with activities, which fall under eco-friendly practices of water and energy conservation, environmental sustainability, and waste management.

References

Ambrose, B., &Linneman, P. (2001). REIT organizational structure and operating characteristics. Journal of Real Estate Research, 21(3), 141-162.

Bloomberg News,. (2001). Company news; hospitality properties buys 4 hotels from marriott. Nytimes.com. Retrieved 24 January 2017, from http://www.nytimes.com/2001/06/19/business/company-news-hospitality-properties-buys-4-hotels-from-marriott.html?rref=collection%2Ftimestopic%2FHospitality%20Properties%20Trust

Business Wire,. (2016). Businesswire.com. Retrieved 24 January 2017, from http://www.businesswire.com/news/home/20160809005502/en/Hospitality-Properties-Trust-Announces-Quarter-2016-Results

Eichholtz, P., Kok, N., & Yonder, E. (2012). Portfolio greenness and the financial performance of REITs. Journal of International Money and Finance, 31(7), 1911-1929.

Hospitality Property Trust,. (2017). Management. Hptreit.com. Retrieved 24 January 2017, from http://www.hptreit.com/about/management.aspx

Robaton, A. (2016). Hospitality Properties Trust's Specialty Appeals to Investors. REIT.com. Retrieved 24 January 2017, from https://www.reit.com/news/reit-magazine/january-february-2016/hospitality-properties-trusts-specialty-appeals-investors