Good day and welcome to the public relations Chatham Lodging Announces Second Quarter Earnings Call. Today’s conference is being recorded. At this time, I would like to turn the conference over to Mr. Chris Daly. Please go ahead sir.

Thank you, Eric. Good morning, everyone. Welcome to the Chatham Lodging Trust second quarter 2015 results conference call. This morning, before the opening of the market, Chatham released results for the second quarter of 2015 and I hope you’ve had a chance to review the press release. If you did not receive a copy of the release or you would like one, please call my office at (703) 435-6293 and we’ll be happy to email you one, or you may review the release online at Chatham’s website, www.chathamlodgingtrust.com. Today’s conference call is being transmitted live via telephone and by webcast over Chatham’s website and at streetevents.com. A recording of the call will be available by telephone until 1 p.m. Eastern on Wednesday, August 12, 2015, by dialing 1 (888) 203-1112, reference number 6993806. A replay of the conference call will be posted on Chatham’s website. As a reminder, this conference call is the property of Chatham Lodging Trust and any redistribution, retransmission or rebroadcast of this call in any form without the expressed written consent of Chatham is prohibited. Before we begin, Management has asked me to remind you that in keeping with the SEC’s Safe Harbor guidelines, today’s conference call may contain forward-looking statements about Chatham Lodging Trust, including statements regarding future operating results and the timing and composition of revenues among others. Except for historical information, these forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially, including the volatility of the national economy, economic conditions generally in the hotel and real estate markets specifically, international and geopolitical difficulties or health concerns, governmental actions, legislative and regulatory changes, availability of debt and equity capital, interest rates, competition, weather conditions or natural disasters, supply and demand for lodging facilities in our current and proposed market areas, and the company’s ability to manage integration and growth. Additional risks are discussed in the company’s filings with the Securities and Exchange Commission. All information in this call is as of August 5, 2015 unless otherwise noted, and the company undertakes no obligation to update any forward-looking statements to conform the statement to actual results or changes in the company’s expectations. During this call, we may refer to certain non-GAAP financial measures, such as EBITDA and adjusted EBITDA, which we believe to be common in the industry, and helpful indicators of our performance. Keeping with SEC regulations, we have provided and encourage you to refer to reconciliations of these measures to GAAP results in our earnings release. Now, to provide you with some insight into Chatham’s 2015 second quarter results, allow me to introduce Jeff Fisher, Chairman, President and CEO, Dennis Craven, Executive VP and Chief Operating Officer, and Jeremy Wegner, Senior Vice President and Chief Financial Officer. Let me turn the session over to Jeff. Jeff?

Yes. Thanks Chris. Good morning, everyone. Thanks for being on the call, it’s great to be here and for the first time to welcome Jeremy Wegner joining Dennis and I for the call, so don't be too difficult on them, but between now and question time you can think effusing us anyway. Many of you met Jeremy at NAREIT, and we’re glad to say that the transition has been very smooth. During the quarter we celebrated our fifth anniversary as a public company and it’s great to look back and see how far we've come since then starting out with six hotels and a market cap of only $160 million and now we sit here today with a market cap over $1 billion, owning 36 hotels outright and owning interests in another 96 hotels. With Jeremy joining the team, I think our team is highly scalable and we look forward to continued growth as we build Chatham into the premier select service REIT out there. I want to spend a few minutes talking about industry fundamentals. We remain bullish, I started this way on the last quarter call, obviously there is a lot that's transpired given the fact that most hotel companies have reported earnings before us this quarter, we think it's a great time to be an owner of hotels. GDP growth in the country is moderately healthy. Demand continues to outpace supply with demand up 3.3% year-to-date through June and only a moderate increase in new supply at a little over 1%. As matter of fact most of the so-called industry experts have in fact reduced their supply estimates additions to supply during this year and for 2016. The projects are not coming out as fast as they anticipated for a variety of reasons, nonetheless the net effect…

Thanks Jeff. Good morning everybody. I wanted to start just by walking through our earnings for the quarter versus our guidance for the second quarter that we put out there in May. Our RevPAR guidance for the quarter was 6% to 8% for all hotels including the Maitland, Homewood Suites and we ended up seeing growth of 6.4%; again a very healthy number considering the performance of the most other lodging REITs that are out there. Adjusted FFO per share came in at $0.71 versus our guidance range of $0.69 to $0.74 per share. Consistent given the fact that RevPAR growth was towards the lower end of our guidance range. The only operating metric that fell outside of our guidance range was hotel EBITDA margins, which came in as still a strong 46% versus our original guidance range of 46.3% to 47.5%. Flow through of the incremental revenue year-over-year, which was about 72% in the first quarter came in at approximately 58% in the second quarter, driven by slightly higher repairs and maintenance expenses for some unplanned items in certain of our hotels. Had we met the same flow through in the second quarter as we had in the first quarter, our FFO per share would have been approximately $0.02 higher. Still, as Jeff alluded to or Jeff spoke, the fact is our hotel both on the operating margin side and the hotel EBITDA margin side, the margin still grew 80 basis points and 60 basis points respectively very strong and very good when you consider the performance of most of the other lodging REITs, which saw lower margin growth quarter-over-quarter. Other key items that impacted this in the quarter; our corporate G&A was actually down about $0.5 million from our guidance range, mainly due to this timing and expenses…

Thanks Dennis, good morning everyone, excited to be here. For the quarter, we reported net income of $12.8 million or $0.33 per diluted share compared to net income of $65.3 million for $2.44 per diluted share in Q2 2014. In 2014, our net income included a $66.7 million gain on the recapitalization of the Innkeepers joint venture. The primary differences between net income and FFO relate to non-cash cost, such as depreciation which was $12 million in the quarter, hotel acquisition cost of approximately $500,000 related to the acquisitions of the San Diego Gaslamp, Dedham and Fort Lauderdale Residence Inn and our share of similar items within the joint ventures, which were approximately $1.9 million in the quarter. Adjusted FFO for the quarter was $27.2 million compared to $14.8 million in the 2014 second quarter, a very impressive increase of 83%. Adjusted FFO per share was $0.71 per share versus $0.56 per share in Q2 2014, a 27% increase year-over-year. Adjusted EBITDA for the company rose significantly, up 71% to $36.7 million compared to $21.5 million in Q2 2014. In the quarter, our three joint ventures contributed approximately $5.2 million of adjusted EBITDA and $3.3 million of adjusted FFO, at the low end of our guidance of $3.3 million to $3.5 million. During the quarter, we received distributions of $1.7 million from the Innkeepers portfolio and $1 million from the Inland portfolio. In the first year of our new Innkeepers investment, our leveraged cash on cash returns were substantial at approximately 18%. Through essentially six-months of the investment in the Inland JV, we received approximately $1.4 million of distributions on our $28 million investment. Our balance sheet is in excellent condition as we move into the third and fourth quarters. Our net debt was $503 million at the end of…

Thank you very much. [Operator Instructions] Our first question comes from Anthony Powell from Barclays Capital. Please go ahead sir.

Hi, good morning everyone. Just on the Inland JV, could you have remind us what market kind of contributed most to those – to that JV and also was market underperformed?

Yeah, I mean, overall as we indicated in the release and in our comments the market was certainly – the overall portfolio was a little bit weaker than the Innkeepers portfolio, but certainly as we kind of look down the hotels, we had some weakness in the North Carolina markets, Chapel Hill, Wilmington, the hotels are fairly soft. We’ve got a couple of hotels as well that kind of as we look at outside of New York area, but in Princeton, New Jersey was certainly one of our weaker performing hotels, RevPAR there was down about 19% for the quarter. So, a handful of hotels had what I would call mid-teen RevPAR declines with two or three of those in like I said in the North Carolina markets. In terms of the Houston exposure within the Inland portfolio, the Westchase Hotels actually can see – actually had fairly decent RevPAR, they held up okay. We've got a hotel that’s outside of Houston, a courtyard by Marriott to Houston Northwest; a little further out RevPAR was down about 13% for the quarter. So again, I think similar but a little bit between North Carolina, Princeton, New Jersey and the Houston area those were kind of the key drivers of that portfolio.

Got it. And just a follow-up on the transaction activity; are you seeing either less competition or less sales out there, over the past few month given some of the volatility we've seen in some of the stock prices in lodging REITs or slight slowdown in RevPAR growth? Are people still buying or selling, what’s the overall environment out there?

I’ll tell you what, I think – this is Jeff, how are you Anthony?

Great.

I would say there is still plenty of activity, and frankly the real people that are in the business obviously are indicating buy their pocketbooks how they view the future, even though obviously some of our institutional or other folks that play in the stock market a little bit seem to be a little more bearish because on the real street corner there is plenty of activity and plenty of forward-looking, I think positive indicators that would say, yeah this is a good time to be owning hotels as I said at the outset and a good time to buy hotels.

Great. Thanks a lot.

Our next question comes from Mr. Patrick Scholes from SunTrust. Please go ahead sir.

Hi, good morning. A couple of questions here; first on the renovations listed in the press release in Houston and Savannah, have these been accelerated forward or were these originally in the schedule all along for the fourth quarter?

Schedule all along.

Okay. Secondly you mentioned Princeton had a very weak performance in the quarter, wondering if you can just give more color on, I think you said negative 19? What is happening there?

So for the quarter, the Princeton Hotel, let’s see here, yeah for the quarter was down and our RevPAR share was down about 19%. I think that from an overall performance of the hotel, if you look at the actual market, the actual market was, just bear with me a second Pat, but if you look at the actual market, the actual market for the Princeton area was up 6.3%. Our share was down about 19% and so our hotel actually saw a RevPAR decline of about 14%. So I think for that particular hotel there was some one-time business, contract business in 2014 that we’ve seen that obviously wasn't replaced this year. I think when it gets down to kind of getting your hands around these hotels, especially with the Inland portfolio since we as well as Island are new to the portfolio is getting your hands around a lot of that business that within the markets of the hotels last year. And quite frankly with a lot of the turnover that we saw around the time that we bought the portfolio that, that knowledge is certainly has to be obtained as you’re operating the hotel. So I think we've seen that in a few instances in the portfolio where there is books of business that were there in 2014 that weren’t appropriately replaced in 2015.

Because that portfolio was kind of flogged on the market, obviously in a more of an auction format, you’ve got the Inn and the management company that had most of those hotels, knew they were short term at best, that mean it's not uncommon, that this kind of stuff occurs, but when you look at an extended stay hotel like in that Princeton deal, as a Homewood Suite, you have even more of that than let's say a non-extended stay hotel because some percentage depending on location and asset, any extended stay hotels business is going to be what I'll call special project business or training business. And if that's not proactively being pursued on a direct sales basis and as training groups hotel, the challenge for the operating team is to always replace that business in the market, and so you know, we’ve got a few of those that really drag the overall results down in Inland. The way I’m looking at Inland is frankly, I think a 24 month role, and I'm pretty excited overall as our folks are getting their arms around these assets. And I think that our history has always been especially in extended-stay hotels a very high degree of success in knowing where to find the business and put it in the hotels. So we should have a pretty good view going forward. I think the contribution for 2016 will probably be up, way up from what we probably originally budgeted, whereas 2015 is down from what we originally budgeted. So that's kind of the in-depth color, Pat on that one.

Okay. One last question, thank you for that. What are your expectations for Houston for the rest of the year and into next year, not for the market, but specifically your hotels in Houston?

Yeah, I mean I think for our hotels, I think listen, it’s still going to be primarily low single-digits in terms of RevPAR growth for the balance of the year. We do have in the third quarter the Residence Inn – at West University that under renovation, so taking that one out of the equation, the other three we would expect it to be low single-digit RevPAR growth. 2016, it’s certainly – no reason to think that it’s going to be anything greater than again low single-digits for that market.

Definitely easier comps later in the year for those markets. I think that’s all, thank you.

[Operator Instructions] There are no further questions at this time, please continue.

Well, those are very few questions, but nonetheless nobody saved a zinger for Jeremy I guess. I’d like to just finish up by again reiterating our positive feelings about not only the industry, but you know hotels that we own here with our Residence Inns and the other brands that we specialize in and within those brands I think some of the best hotels in the United States, and in the best markets in the country. Fort Lauderdale, the new acquisition should come on very strong towards obviously the backend, back quarter of this year as the South Florida season picks up. I think our revenue management team frankly from what I've seen and the shift from where it was revenue managed and how it was revenue managed before to our team's abilities and already looking for the appropriate business to be in that hotel. And the appropriate mix of extended-stay business and very high paying transient business should bode very, very well for us, as we move into 2016. And frankly, the unnamed Los Angeles acquisition has a RevPAR that is – and I think room for growth in RevPAR index that is very high and very strong, so again, a very positive contributor to our overall NAV and value proposition for Chatham. So again, we will continue to work hard here and I expect to see some more good numbers as we move forward. Thank you all for attending.