70509VAA8

The following discussion and analysis should be read in conjunction with the consolidated financial statements and related notes included elsewhere in this report. Pebblebrook Hotel Trust is a Maryland real estate investment trust that conducts its operations so as to qualify as a real estate investment trust ("REIT") under the Internal Revenue Code of 1986, as amended (the "Code"). Substantially all of the operations are conducted through Pebblebrook Hotel, L.P. (our "Operating Partnership"), a Delaware limited partnership of which Pebblebrook Hotel Trust is the sole general partner. In this report, we use the terms "the Company", "we" or "our" to refer to Pebblebrook Hotel Trust and its subsidiaries and "hotels" and "hotel properties" to refer to hotels and resorts, unless the context indicates otherwise. FORWARD-LOOKING STATEMENTS This report, together with other statements and information publicly disseminated by us, contains certain "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), 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", "will", "should", "potential", "could", "seek", "assume", "forecast", "believe", "expect", "intend", "anticipate", "estimate", "project" 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, estimated costs and durations of renovation or restoration projects, timing and extent of debt refinancings, estimated insurance recoveries, our ability to realize deferred tax assets and expected liquidity needs and sources (including capital expenditures and our 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. These factors include, but are not limited to, the following: •risks associated with the hotel industry, including competition; changes in visa and other travel policies by the U.S. government making it less convenient, more difficult or less desirable for international travelers to enter the U.S.; increases in employment costs, energy costs or other operating costs; and decreases in demand caused by events beyond our control, including, without limitation, actual or threatened terrorist attacks, natural disasters, cyber attacks, any type of flu or disease-related pandemic, or downturns in general and local economic conditions; •world events impacting the ability or desire of people to travel may lead to a decline in demand for hotels; •the availability and terms of financing and capital and the general volatility of securities markets; •our dependence on third-party managers of our hotels, including our inability to implement strategic business decisions directly; •risks associated with the U.S. and global economies, the cyclical nature of hotel properties and the real estate industry, including environmental contamination and costs of complying with new or existing laws, including the Americans with Disabilities Act and similar laws; •interest rate increases; •our possible failure to qualify as a REIT under the Code and the risk of changes in laws affecting REITs; •the timing and availability of potential hotel acquisitions, our ability to identify and complete hotel acquisitions and our ability to complete hotel dispositions in accordance with our business strategy; •the possibility of uninsured losses; •risks associated with redevelopment and repositioning projects, including delays and cost overruns; and •the other factors discussed under Risk Factors in Part II, Item 1A of this Quarterly Report on Form 10-Q and our Annual Report on Form 10-K for the year ended December 31, 2025. Accordingly, there is no assurance that our expectations will be realized. Except as otherwise required by the federal securities laws, we disclaim any obligations 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. 26 Table of Contents Overview Second quarter operating results built on the strength we saw in the first quarter. Both business and leisure demand continued to grow. Our resort properties led the portfolio growth, particularly LaPlaya Beach Resort & Club, Estancia La Jolla Hotel & Spa, Paradise Point Resort & Spa, and Newport Harbor Island Resort. San Francisco's recovery continued to gain momentum, with a significant increase in RevPAR as corporate and leisure demand broadened alongside an active citywide convention calendar. Chicago, Los Angeles, and Boston also benefited from healthy ADR increases. Pricing power strengthened across our portfolio and our continued focus on operating efficiencies initiatives have resulted in higher earnings growth. While the quarter was positive, we remain cautious towards the remainder of the year given an uncertain macroeconomic environment. During the six months ended June 30, 2026, we had the following transactions and events: •We amended our senior unsecured revolving credit facility and unsecured term loan facilities to extend the $360.0 million Term Loan 2027 to mature in February 2031 and to provide for a delayed draw option to borrow an additional $90.0 million by December 15, 2026 (which we now refer to the extended loan as Term Loan 2031). We also extended the maturity date of the $48.0 million unextended portion of the senior unsecured revolving credit facility to October 2028. •We repaid the remaining $40.0 million mortgage loan on Margaritaville Hollywood Beach Resort. •We repurchased 944,452 common shares for an aggregate purchase price of $12.9 million, or an average of approximately $13.63 per share, under our common share repurchase program. •We repurchased 1,487,038 preferred shares for an aggregate purchase price of $28.6 million, or an average of approximately $19.22 per share, under our preferred share repurchase program. •We sold the Chamberlain West Hollywood Hotel for $43.5 million. While we do not operate our hotel properties, both our asset management team and our executive management team monitor and work cooperatively with our hotel managers by advising and making recommendations in all aspects of our hotels' operations, including property positioning and repositioning, revenue and expense management, operations analysis, physical design, renovation and capital improvements, guest experience and overall strategic direction. Through these efforts, we seek to improve property efficiencies, lower costs, maximize revenues and enhance property operating margins, which we expect will enhance returns to our shareholders. Key Indicators of Financial Condition and Operating Performance We measure hotel results of operations and the operating performance of our business by evaluating financial and non-financial metrics such as room revenue per available room ("RevPAR"); total revenue per available room ("Total RevPAR"); average daily rate ("ADR"); occupancy rate ("Occupancy"); funds from operations ("FFO"); Adjusted FFO; earnings before interest, income taxes, depreciation and amortization ("EBITDA"); and EBITDA for real estate ("EBITDAre"); Adjusted EBITDAre; and hotel-level EBITDA ("Hotel EBITDA"). We evaluate individual hotel and company-wide performance with comparisons to budgets, prior periods and competing properties. ADR, occupancy and RevPAR may be impacted by macroeconomic factors as well as regional and local economies and events. See Non-GAAP Financial Measures for further discussion of FFO, Adjusted FFO, EBITDA, EBITDAre, Adjusted EBITDAre and Hotel EBITDA. Hotel Operating Statistics The following table represents the key same-property hotel operating statistics for our hotels for the three and six months ended June 30, 2026 and 2025: For the three months ended June 30, For the six months ended June 30, 2026 2025 2026 2025 Same-Property Occupancy 79.4 % 78.1 % 73.9 % 70.6 % Same-Property ADR $ 326.60 $ 311.80 $ 321.31 $ 309.44 Same-Property RevPAR $ 259.41 $ 243.52 $ 237.61 $ 218.31 Same-Property Total RevPAR $ 405.24 $ 386.93 $ 375.55 $ 350.49 For the three and six months ended June 30, 2026 and 2025, the above table of hotel operating statistics includes information from all hotels owned as of June 30, 2026 and includes Chamberlain West Hollywood Hotel for the first quarter only due to its sale in May 2026. 27 Table of Contents Non-GAAP Financial Measures Non-GAAP financial measures are measures of our historical or future financial performance that are different from measures calculated and presented in accordance with U.S. GAAP. We report FFO, Adjusted FFO, EBITDA, EBITDAre, Adjusted EBITDAre and Hotel EBITDA, which are non-GAAP financial measures that we believe are useful to investors as key measures of our operating performance. We calculate FFO in accordance with standards established by Nareit, formerly known as the National Association of Real Estate Investment Trusts, which defines FFO as net income (calculated in accordance with U.S. GAAP), excluding real estate related depreciation and amortization, gains (losses) from sales of real estate, impairments of real estate assets (including impairment of real estate related joint ventures), the cumulative effect of changes in accounting principles and adjustments for unconsolidated affiliates. Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values instead have historically risen or fallen with market conditions, most industry investors consider presentations of operating results for real estate companies that use historical cost accounting to be insufficient by themselves. By excluding the effect of real estate related depreciation and amortization including our share of the joint venture depreciation and amortization, gains (losses) from sales of real estate and impairments of real estate assets (including impairment of real estate related joint ventures), all of which are based on historical cost accounting and which may be of lesser significance in evaluating current performance, we believe that FFO provides investors a useful financial measure to evaluate our operating performance. Adjusted FFO is defined as FFO, as adjusted for transaction costs, non-cash ground rent on operating and finance lease liabilities, management/franchise contract transition costs, interest expense adjustment for acquired liabilities, finance lease adjustment, non-cash amortization of acquired intangibles, gain on insurance settlement, early extinguishment of debt, amortization of share-based compensation expense, issuance costs of redeemed preferred shares, hurricane-related costs, non-cash interest expense, unrealized loss on investment and deferred tax asset provision (benefit). We believe Adjusted FFO provides useful supplemental information regarding our ongoing operating performance. The following table reconciles net income (loss) to FFO, FFO available to common share and unit holders and Adjusted FFO available to common share and unit holders for the three and six months ended June 30, 2026 and 2025 (in thousands): For the three months ended June 30, For the six months ended June 30, 2026 2025 2026 2025 Net income (loss) $ 24,913 $ 19,285 $ 6,477 $ (12,895) Adjustments: Real estate depreciation and amortization 52,043 57,584 103,966 115,071 Impairment 1,112 — 8,800 — FFO $ 78,068 $ 76,869 $ 119,243 $ 102,176 Distribution to preferred shareholders and unit holders (11,083) (11,796) (22,674) (23,591) Repurchase of preferred shares 6,999 — 6,999 — FFO available to common share and unit holders $ 73,984 $ 65,073 $ 103,568 $ 78,585 Transaction costs 10 55 60 57 Non-cash ground rent on operating and finance leases 1,716 1,823 3,431 3,662 Management/franchise contract transition costs 50 — 130 5 Interest expense adjustment for acquired liabilities 190 237 509 561 Finance lease adjustment 768 758 1,533 1,513 Non-cash amortization of acquired intangibles (49) (465) (101) (937) Early extinguishment of debt — — 627 — Amortization of share-based compensation expense 2,563 3,522 4,869 6,741 Repurchase of preferred shares (6,999) — (6,999) — Deferred tax provision (benefit) 5,241 6,439 5,224 3,334 Unrealized loss on investment — — 1,639 2,662 Adjusted FFO available to common share and unit holders $ 77,474 $ 77,442 $ 114,490 $ 96,183 28 Table of Contents EBITDA is defined as earnings before interest, income taxes, depreciation and amortization. We calculate EBITDAre in accordance with standards established by Nareit. EBITDAre is defined as EBITDA as adjusted for gain on sale of hotel properties and impairment loss. Adjusted EBITDAre is defined as EBITDAre, as adjusted for transaction costs, non-cash ground rent on operating and finance lease liabilities, management/franchise contract transition costs, non-cash amortization of acquired intangibles, gain on insurance settlement, amortization of share-based compensation expense, unrealized loss on investment and hurricane-related costs. Hotel EBITDA is defined as Adjusted EBITDAre plus corporate general and administrative expenses less interest income, business interruption insurance income and other. We believe that EBITDA, EBITDAre, Adjusted EBITDAre and Hotel EBITDA provide investors useful financial measures to evaluate our operating performance, excluding the impact of our capital structure (primarily interest expense) and our asset base (primarily depreciation and amortization). The following table reconciles net income (loss) to EBITDA, EBITDAre, Adjusted EBITDAre and Hotel EBITDA for the three and six months ended June 30, 2026 and 2025 (in thousands): For the three months ended June 30, For the six months ended June 30, 2026 2025 2026 2025 Net income (loss) $ 24,913 $ 19,285 $ 6,477 $ (12,895) Adjustments: Interest expense 26,056 27,282 52,370 54,415 Income tax expense (benefit) 7,716 7,812 7,699 4,650 Depreciation and amortization 52,099 57,645 104,078 115,188 EBITDA $ 110,784 $ 112,024 $ 170,624 $ 161,358 Impairment 1,112 — 8,800 — EBITDAre $ 111,896 $ 112,024 $ 179,424 $ 161,358 Transaction costs 10 55 60 57 Non-cash ground rent on operating and finance leases 1,716 1,823 3,431 3,662 Management/franchise contract transition costs 50 — 130 5 Non-cash amortization of acquired intangibles (49) (465) (101) (937) Amortization of share-based compensation expense 2,563 3,522 4,869 6,741 Unrealized loss on investment — — 1,639 2,662 Adjusted EBITDAre $ 116,186 $ 116,959 $ 189,452 $ 173,548 Business interruption insurance income — (3,242) — (7,545) Corporate general and administrative and other 7,636 7,262 16,569 15,803 Hotel EBITDA $ 123,822 $ 120,979 $ 206,021 $ 181,806 FFO, Adjusted FFO, EBITDA, EBITDAre, Adjusted EBITDAre and Hotel EBITDA do not represent cash generated from operating activities as determined by U.S. GAAP and should not be considered as alternatives to U.S. GAAP net income (loss), as indications of our financial performance, or to U.S. GAAP cash flow from operating activities, as measures of liquidity. In addition, FFO, Adjusted FFO, EBITDA, EBITDAre, Adjusted EBITDAre and Hotel EBITDA are not indicative of funds available to fund cash needs, including the ability to make cash distributions. Results of Operations At June 30, 2026 and 2025, our consolidated financial statements included the operations of 43 and 46 hotel properties, respectively, which have been included in our results of operations during the respective periods since their dates of acquisition or through their dates of disposition. Based on when a property was acquired or disposed of, operating results for certain properties are not comparable for the three and six months ended June 30, 2026 and 2025. The properties listed in the table below are hereinafter referred to as "non-comparable properties" and all other properties are referred to as "comparable properties". Property Location Disposition Date Montrose at Beverly Hills Los Angeles, CA November 19, 2025 The Westin Michigan Avenue Chicago Chicago, IL December 3, 2025 Chamberlain West Hollywood Hotel Los Angeles, CA May 27, 2026 29 Table of Contents Comparison of the three months ended June 30, 2026 to the three months ended June 30, 2025 Revenues — Total revenues decreased by $0.4 million primarily due to the loss of $19.7 million in revenues from the sales of the non-comparable properties, offset by an increase in revenues at many of the resort properties, including Paradise Point Resort & Spa, Estancia La Jolla Hotel & Spa, LaPlaya Beach Resort & Club and Newport Harbor Island Resort, as well as an increase in revenues at our Los Angeles and San Francisco properties due to their continued recovery. Hotel operating expenses — Total hotel operating expenses decreased by $1.2 million primarily as a result of the sales of non-comparable properties, partially offset by an increase in costs at our comparable properties associated with higher revenues. Depreciation and amortization — Depreciation and amortization expense decreased by $5.5 million primarily due to the sales of non-comparable properties and lower capital expenditures in 2025 and 2026. Real estate taxes, personal property taxes, property insurance and ground rent — Real estate taxes, personal property taxes, property insurance and ground rent decreased by $1.7 million primarily due to a decrease in real estate taxes at the non-comparable properties and reductions resulting from assessment appeals and a decrease in property insurance costs, partially offset by higher percentage ground rent resulting from higher revenues at properties subject to ground leases. Impairment — We recognized an impairment loss of $1.1 million in 2026 related to one hotel. No impairment loss was recognized in the second quarter of 2025. Business interruption insurance income and gain on insurance settlement — We recognized business interruption insurance income in 2025 related to partial settlements with our insurance carriers for lost income at LaPlaya Beach Resort & Club resulting from Hurricanes Helene and Milton. There was no business interruption insurance income in 2026. Interest expense — Interest expense decreased by $1.2 million primarily as a result of lower borrowings in 2026. Non-controlling interests — Non-controlling interests represents the allocation of income or loss of the Operating Partnership to third-party OP unit holders and preferred OP unit holders. Repurchase of preferred shares — Repurchase of preferred shares represents the preferred share issuance costs offset by the repurchase discount. In 2026, we repurchased 1,487,038 preferred shares under our preferred share repurchase program at a discount to the redemption value. The discount, net of the issuance costs associated with the preferred shares repurchased, is included in the determination of net income (loss) attributable to common shareholders. Comparison of the six months ended June 30, 2026 to the six months ended June 30, 2025 Revenues — Total revenues increased by $25.0 million primarily due to an increase in revenues at our Los Angeles properties, which were negatively impacted in 2025 by the wildfires, and an increase in revenues at our San Francisco properties due to the continued recovery of business travel as well as the Super Bowl. In addition, many of the resort properties had increases in revenues, primarily Paradise Point Resort & Spa, Estancia La Jolla Hotel & Spa and LaPlaya Beach Resort & Club. These increases were partially offset by decreases in revenues from non-comparable properties, a decline in revenues at the Washington, D.C. properties resulting from the presidential inauguration occurring only in 2025 and a decrease in revenues at Revere Hotel Boston Common as a result of a room refreshment. Hotel operating expenses — Total hotel operating expenses increased by $3.6 million primarily as a result of higher revenues as described above, which was offset by a decrease in hotel operating expenses associated with non-comparable properties. Depreciation and amortization — Depreciation and amortization expense decreased by $11.1 million primarily due to the sales of the non-comparable properties and lower capital expenditures in 2025 and 2026. Real estate taxes, personal property taxes, property insurance and ground rent — Real estate taxes, personal property taxes, property insurance and ground rent decreased by $2.2 million primarily due to a decrease in real estate taxes at non-comparable properties, partially offset by higher percentage ground rent resulting from higher revenues at properties subject to ground leases. General and administrative — General and administrative expenses decreased by $1.8 million primarily due to a decrease in non-cash compensation expense. General and administrative expenses consist of employee compensation costs, legal and professional fees, insurance and other expenses. Impairment — We recognized an impairment loss of $8.8 million in 2026 related to one hotel. No impairment loss was recognized in 2025. Business interruption insurance income — We recognized business interruption insurance income in 2025 related to partial settlements with our insurance carriers for lost income at LaPlaya Beach Resort & Club resulting from Hurricanes Helene and Milton. There was no business interruption insurance income in 2026. Interest expense — Interest expense decreased by $2.0 million primarily as a result of lower borrowings in 2026. 30 Table of Contents Income tax (expense) benefit — Income tax expense increased by $3.0 million primarily due to an increase in the taxable income of our TRS compared to the same period in the prior year. Non-controlling interests — Non-controlling interests represents the allocation of income or loss of the Operating Partnership to third-party OP unit holders and preferred OP unit holders. Repurchase of preferred shares — Repurchase of preferred shares represents the preferred share issuance costs offset by the repurchase discount. In 2026, we repurchased 1,487,038 preferred shares under our preferred share repurchase program at a discount to the redemption value. The discount, net of the issuance costs associated with the preferred shares repurchased, is included in the determination of net income (loss) attributable to common shareholders. Critical Accounting Policies Our consolidated financial statements have been prepared in conformity with U.S. GAAP, which requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the dates of our financial statements and the reported amounts of revenues and expenses during the reporting period. While we do not believe the reported amounts would be materially different, application of these policies involves the exercise of judgment and the use of assumptions as to future uncertainties and, as a result, actual results could differ from these estimates. We evaluate our estimates and judgments on an ongoing basis. We base our estimates on experience and on various other assumptions that are believed to be reasonable under the circumstances. All of our significant accounting policies, including certain critical accounting policies, are disclosed in our Annual Report on Form 10-K for the year ended December 31, 2025. New Accounting Pronouncements See Note 2. Summary of Significant Accounting Policies to our consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q for recently issued accounting pronouncements that may affect us. Liquidity and Capital Resources Our primary sources of liquidity are cash provided by our operations, borrowings under our credit facilities, net proceeds from equity and debt offerings, and net proceeds from property sales. Our primary cash requirements in the short term (i.e., those requiring cash on or before June 30, 2027) will be to fund property lease obligations, interest and current principal on debt, capital improvements, dividends on common and preferred shares, and working capital of our property operations. We believe our cash and cash equivalents, restricted cash and the amount available on our senior unsecured revolving credit facility, which totaled $911.6 million as of June 30, 2026, along with cash generated from ongoing operations will be sufficient to satisfy our short-term cash requirements. As of June 30, 2026, we had no off-balance sheet arrangements. In order to maintain our qualification as a REIT, we must pay dividends to our shareholders of at least 90% of our taxable income. As a result of this requirement, we cannot rely on retained earnings to fund long-term liquidity requirements such as hotel property acquisitions, redevelopments and repayments of long-term debt. As such, we expect to continue to raise capital through equity and debt offerings to fund our growth. Our material cash requirements include the following contractual and other obligations. Debt Our outstanding debt consisted of floating- and fixed-rate unsecured term loans, convertible senior notes, unsecured senior notes and a mortgage loan with varying maturities. Our total debt had an aggregate face value of $2.1 billion as of June 30, 2026, as summarized below: June 30, 2026 (in thousands) Unsecured revolving credit facilities $ — Unsecured term loans 901,869 Convertible senior notes 750,000 Unsecured senior notes 400,000 Mortgage loan 52,056 Total debt at face value $ 2,103,925 For further discussion on the components of our debt, see Note 5. Debt to our consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q. We expect that future principal and interest payments associated with our remaining debt obligations outstanding as of June 30, 2026 will be $2.4 billion through their maturity, with $352.2 million of principal and $85.4 million of interest payable on or before June 30, 2027. We intend to pay amounts due with available cash, borrowings under our revolving credit facility or proceeds from property sales or to refinance amounts due with long-term debt. 31 Table of Contents We are in compliance with all covenants governing our existing credit facilities, term loans, senior note facilities and mortgage loan. Our mortgage loan contains customary provisions regarding events of default, as well as customary cash management, cash trap and lockbox provisions. Cash trap provisions may be triggered if the hotel's performance is below a certain threshold. Once triggered, all of the cash flow generated by the hotel is deposited directly into lockbox accounts and then swept into cash management accounts for the benefit of our lender. As of June 30, 2026, the mortgage loan was not in a cash trap. Hotel, ground and finance lease obligations Our properties that are subject to hotel, ground or finance leases, as noted in Note 11. Commitments and Contingencies to our consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q, may require minimum fixed rent payments, percentage rent payments based on a percentage of revenues in excess of certain thresholds or rent payments equal to the greater of a minimum fixed rent or percentage rent. Minimum fixed rent may be adjusted annually by increases in consumer price index ("CPI") and may be subject to minimum and maximum increases. Future fixed minimum payments associated with our hotel, ground and finance leases total $1.9 billion as of June 30, 2026, with $24.8 million payable on or before June 30, 2027. Purchase commitments As of June 30, 2026, we had $3.4 million of outstanding purchase commitments, all of which will be paid on or before June 30, 2027. These purchase commitments represent outstanding purchase orders and contracts that have been executed for capital and renovation projects at our properties. See Capital Investments (below) for discussion on planned capital investments. Preferred share dividends and Series Z distributions We expect to pay aggregate annual dividends and distributions of approximately $44.1 million on our outstanding Series E, Series F, Series G and Series H Cumulative Redeemable Preferred Shares and Series Z Cumulative Perpetual Preferred Units on or before June 30, 2027 and in future years until the shares/units are redeemed. For further discussion on our preferred shares and preferred units, see Note 7. Equity to our consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q. Sources and Uses of Cash Our principal sources of cash are cash from operations, draws on our credit facilities, net proceeds from equity and debt offerings, and net proceeds from property sales. Our principal uses of cash are asset acquisitions, debt service payments, the redemption of equity securities, capital investments, operating costs, corporate expenses and dividends. Operating Activities. Our net cash provided by operating activities was $170.4 million for the six months ended June 30, 2026 and $140.9 million for the six months ended June 30, 2025. Fluctuations in our net cash provided by (used in) operating activities are primarily the result of changes in hotel revenues, operating cash requirements and corporate expenses. Investing Activities. Our net cash used in investing activities was $5.4 million for the six months ended June 30, 2026 and $47.5 million for the six months ended June 30, 2025. Fluctuations in our net cash provided by (used in) investing activities are primarily the result of disposition activities, as well as capital improvements and additions to our properties. •During the six months ended June 30, 2026, we invested $24.4 million in improvements to our hotel properties, received $16.1 million from the sale of Chamberlain West Hollywood Hotel and received $3.2 million in property insurance proceeds. •During the six months ended June 30, 2025, we invested $49.5 million in improvements to our hotel properties and received $2.4 million in property insurance proceeds. Financing Activities. Our net cash used in financing activities was $90.8 million for the six months ended June 30, 2026 and $43.8 million for the six months ended June 30, 2025. Fluctuations in our net cash provided by (used in) financing activities are primarily the result of our issuance and repurchase of debt and equity securities and distributions paid on our preferred and common shares. •During the six months ended June 30, 2026, we borrowed $360.0 million and repaid $401.3 million of debt, repurchased $13.9 million of common shares through our common share repurchase program and for tax withholding purposes in connection with vestings of share-based equity awards, paid $6.6 million in deferred financing costs and paid $25.5 million in preferred and common distributions. •During the six months ended June 30, 2025, we repaid $1.1 million of debt, repurchased $15.6 million of common shares through our common share repurchase program and for tax withholding purposes in connection with vestings of share-based equity awards and paid $26.0 million in preferred and common distributions. 32 Table of Contents Capital Investments We maintain and intend to continue maintaining all of our hotels in good repair and condition, in conformity with applicable laws and regulations, in accordance with franchisor standards when applicable and in accordance with agreed-upon requirements in our management agreements. Routine capital investments will be administered by the hotel management companies. However, we maintain approval rights over the capital investments as part of the annual budget process and as otherwise required from time to time. Certain of our hotel properties may undergo renovations as a result of our decision to upgrade portions of the hotels, such as guest rooms, meeting space and restaurants, in order to better compete with other hotels in our markets. In addition, after we acquire a hotel property, we are often required by the franchisor or brand manager, if any, to complete a property improvement plan ("PIP") in order to bring the hotel property up to the franchisor's or brand's standards. Generally, we expect to fund renovations and improvements with available cash, restricted cash, borrowings under our credit facility or proceeds from new debt or equity offerings. For the six months ended June 30, 2026, we invested $24.4 million in capital investments to reposition and/or improve our properties, including the capital maintenance projects and renovations of Chaminade Resort & Spa. Depending on market conditions, and in some instances subject to approval from governmental authorities, we expect to invest a total of $65.0 million to $75.0 million in capital investments in 2026, which includes normal hotel capital refurbishments and repositioning projects at Paradise Point Resort & Spa and Chaminade Resort & Spa. Common Share Repurchase Program and Preferred Share Repurchase Programs Common Share Repurchase Program On October 21, 2025, our Board of Trustees authorized a share repurchase program of up to $150.0 million of common shares. Under this program, we may repurchase common shares from time to time in transactions on the open market or by private agreement. We may suspend or discontinue this program at any time. Common shares repurchased by us cease to be outstanding and become authorized but unissued common shares. During the six months ended June 30, 2026, we repurchased 944,452 common shares for an aggregate purchase price of $12.9 million, or an average of approximately $13.63 per share. As of June 30, 2026, $137.1 million of common shares remained available for repurchase under this program. The timing, manner, price and amount of any repurchases will be determined by us in our discretion and will depend on a variety of factors, including legal requirements, price, liquidity and economic considerations, and market conditions. The program does not require us to repurchase any specific number of common shares. The program does not have an expiration date and may be suspended, modified or discontinued at any time. Preferred Share Repurchase Programs On February 17, 2023, our Board of Trustees authorized a share repurchase program of up to $100.0 million of preferred shares (the "2023 Preferred Share Repurchase Program"). Under the terms of the program, we may repurchase up to an aggregate of $100.0 million of our 6.375% Series E Cumulative Redeemable Preferred Shares, 6.30% Series F Cumulative Redeemable Preferred Shares, 6.375% Series G Cumulative Redeemable Preferred Shares and 5.70% Series H Cumulative Redeemable Preferred Shares from time to time in transactions on the open market or by private agreement. During the six months ended June 30, 2026, we repurchased and retired 1,487,038 preferred shares for an aggregate purchase price of $28.6 million, or an average of approximately $19.22 per share. This includes 1,347,614 preferred shares received as partial consideration for the sale of Chamberlain West Hollywood Hotel and 139,424 preferred shares repurchased in the market. As of June 30, 2026, $45.6 million remained available for repurchase of preferred shares under this program. On July 24, 2026, our Board of Trustees authorized a new share repurchase program of up to $50.0 million of preferred shares (the "2026 Preferred Share Repurchase Program"), which will commence upon the completion of the 2023 Preferred Share Repurchase Program. Under the 2026 Preferred Share Repurchase Program, we may repurchase up to an aggregate of $50.0 million of our 6.375% Series E Cumulative Redeemable Preferred Shares, 6.30% Series F Cumulative Redeemable Preferred Shares, 6.375% Series G Cumulative Redeemable Preferred Shares and 5.70% Series H Cumulative Redeemable Preferred Shares from time to time in transactions on the open market or by private agreement. The timing, manner, price and amount of any repurchases will be determined by us in our discretion and will depend on a variety of factors, including legal requirements, price, liquidity and economic considerations, and market conditions. The programs do not require us to repurchase any specific number of preferred shares. The programs do not have an expiration date and may be suspended, modified or discontinued at any time. 33 Table of Contents Inflation We rely on the performance of the hotels to increase revenues to keep pace with inflation. Generally, our hotel operators possess the ability to adjust room rates daily, except for group or corporate rates contractually committed to in advance, although competitive pressures may limit the ability of our operators to raise rates faster than inflation or even at the same rate. Seasonality Demand in the lodging industry is affected by recurring seasonal patterns which are greatly influenced by overall economic cycles, geographic locations, weather and customer mix at the hotels. Generally, our hotels have lower revenue, operating income and cash flow in the first and fourth quarters of each year and higher revenue, operating income and cash flow in the second and third quarters of each year. Derivative Instruments In the normal course of business, we are exposed to the effects of interest rate changes. We may enter into derivative instruments including interest rate swaps, caps and collars to manage or hedge interest rate risk. Derivative instruments are subject to fair value reporting at each reporting date and the increase or decrease in fair value is recorded in net income (loss) or accumulated other comprehensive income (loss), based on the applicable hedge accounting guidance. Derivatives expose the Company to credit risk in the event of non-performance by the counter parties under the terms of the interest rate hedge agreements. We believe we minimize the credit risk by transacting with major credit-worthy financial institutions. As of June 30, 2026, we have interest rate swap agreements with an aggregate notional amount of $865.0 million to hedge variable interest rates on our unsecured term loans. We have designated these pay-fixed, receive-floating interest rate swap derivatives as cash flow hedges. For a further discussion of our derivative instruments, see Note 5. Debt to our consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.