Appraisal Completed for the Mission Valley Hotel

APPRAISAL REPORT

RESIDENCE INN BY MARRIOTT SAN DIEGO MISSION VALLEY 1865 Hotel Circle South San Diego, San Diego County, California 92108 CBRE, Inc. File No. 20-251PS-2969-6 Contract No. RED-21-05

Pari Zaker Vice President, Real Estate Development SAN DIEGO HOUSING COMMISSION

1122 Broadway, Suite 300, San Diego, California 92101 C/O Christensen & Spath, LLP www.cbre.com/valuation www.cbrehotels.com

3501 Jamboree Road, Suite 100 Newport Beach, CA 92660

T 949-725-8500 F 949-725-8545 VALUATION & ADVISORY SERVICES www.cbrehotels.com

Date of Report: September 17, 2020

Pari Zaker Vice President, Real Estate Development SAN DIEGO HOUSING COMMISSION 1122 Broadway, Suite 300, San Diego, California 92101 C/O Christensen & Spath, LLP

RE: Appraisal of Residence Inn by Marriott San Diego Mission Valley 1865 Hotel Circle South San Diego, San Diego County, California 92108 CBRE, Inc. File No. 20-251PS-2969-6 Contract No. RED-21-05

Dear Ms. Zaker: At your request and authorization, CBRE, Inc. has prepared an appraisal of the retrospective fair value of the referenced property. Our analysis is presented in the following appraisal report. The subject is a 192-room extended stay hotel property located at 1865 Hotel Circle South in San Diego, California. The improvements were constructed in 2003, and renovated in 2011 and 2018. In addition, a $500,000 public space remodel occurred in early 2020, which created a new bar/lounge area. The hotel is being operated as the Residence Inn by Marriott San Diego Mission Valley. The 4 and 5 story interior-corridor improvements feature one-bedroom and two- bedroom suites with private bedrooms, living areas, and kitchen. Notable project amenities include an outdoor pool and whirlpool, outdoor children’s pool, breakfast dining area, 900 square feet of meeting space, fitness center, business center, sport-court, market pantry, vending area, guest laundry, and newly renovated bar and lounge area, among others. The subject parcel measures approximately 5.07 acres. The subject entered into a franchise agreement with Marriott International, Inc. as Franchisor and RLJ San Diego-Mission Valley Hotel, LLC, as Franchisee, with the current term expiring in September 2024. The Marriott hotel chain is a recognized lodging destination with accommodations and amenities that cater to specific travelers. The Residence Inn by Marriott is a hotel brand by Marriott that was the first extended-stay hotel brand in the United States. As of July Pari Zaker September 17, 2020 Page 2

2020, there are 852 Residence Inn hotels in the United States, Canada, and Mexico, along with 266 additional hotels in the pipeline. The subject is more fully described, both legally and physically, within the enclosed report. Based on the analysis contained in the following report, the fair value of the subject is concluded as follows:

MARKET VALUE CONCLUSION Appraisal Premise Interest Appraised Date of Value Value Conclusion As Is Fee Simple Estate February 25, 2020 $68,100,000 Compiled by CBRE

The report, in its entirety, including all assumptions and limiting conditions, is an integral part of, and inseparable from, this letter. The effective date of the retrospective value is February 25, 2020. As of the effective date of appraisal, the hotel market was not yet feeling the effects of the COVID-19 pandemic, which began to be felt in the United States market in March 2020. As of the date of report in August 2020, the nation, region, and market area have been materially impacted by the COVID-19 pandemic, which will have a prolonged effect on macroeconomic conditions and corresponding hotel market conditions. Therefore, we note that the valuation conclusions contained herein represent the market conditions as of the effective date of appraisal, prior to the onset of the COVID-19 pandemic, and forecasts/expectations as of February 25, 2020. The following appraisal sets forth the most pertinent data gathered, the techniques employed, and the reasoning leading to the opinion of value. The analyses, opinions and conclusions were developed based on, and this report has been prepared in conformance with, the guidelines and recommendations set forth in the Uniform Standards of Professional Appraisal Practice (USPAP), and the requirements of the Code of Professional Ethics and Standards of Professional Appraisal Practice of the Appraisal Institute. The intended use and user of our report are specifically identified in our report as agreed upon in our contract for services and/or reliance language found in the report. As a condition to being granted the status of an intended user, any intended user who has not entered into a written agreement with CBRE in connection with its use of our report agrees to be bound by the terms and conditions of the agreement between CBRE and the client who ordered the report. No other use or user of the report is permitted by any other party for any other purpose. Dissemination of this report by any party to any non-intended users does not extend reliance to any such party, and CBRE will not be responsible for any unauthorized use of or reliance upon the report, its conclusions or contents (or any portion thereof). Pari Zaker September 17, 2020 Page 3

It has been a pleasure to assist you in this assignment. If you have any questions concerning the analysis, or if CBRE can be of further service, please contact us.

Respectfully submitted,

CBRE - VALUATION & ADVISORY SERVICES

Dan Beverly, MAI Vice President California State Certification No. AG3003262 Expiration Date: August 13, 2021 Phone: (949) 809-4074 Email: [email protected] Certification

Certification

We certify to the best of our knowledge and belief: 1. The statements of fact contained in this report are true and correct. 2. The reported analyses, opinions, and conclusions are limited only by the reported assumptions and limiting conditions and are our personal, impartial and unbiased professional analyses, opinions, and conclusions. 3. We have no present or prospective interest in or bias with respect to the property that is the subject of this report and have no personal interest in or bias with respect to the parties involved with this assignment. 4. Our engagement in this assignment was not contingent upon developing or reporting predetermined results. 5. Our compensation for completing this assignment is not contingent upon the development or reporting of a predetermined value or direction in value that favors the cause of the client, the amount of the value opinion, the attainment of a stipulated result, or the occurrence of a subsequent event directly related to the intended use of this appraisal. 6. This appraisal assignment was not based upon a requested minimum valuation, a specific valuation, or the approval of a loan. 7. Our analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with the Uniform Standards of Professional Appraisal Practice, as well as the requirements of the State of California. 8. The reported analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with the requirements of the Code of Professional Ethics and Standards of Professional Appraisal Practice of the Appraisal Institute. 9. The use of this report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives. 10. As of the date of this report, Dan Beverly, MAI has completed the continuing education program for Designated Members of the Appraisal Institute. 11. Dan Beverly, MAI has made a personal inspection of the property that is the subject of this report. 12. No one provided significant real property appraisal assistance to the persons signing this report. 13. Valuation & Advisory Services operates as an independent economic entity within CBRE, Inc. Although employees of other CBRE, Inc. divisions may be contacted as a part of our routine market research investigations, absolute client confidentiality and privacy was always maintained with regard to this assignment without conflict of interest. 14. Dan Beverly, MAI has not performed any prior appraisal services for the property that is the subject of this appraisal report within a prior 3-year period.

Dan Beverly, MAI California State Certification No. AG3003262 Expiration Date: August 13, 2021

Subject Photographs

Aerial View (Parcel Lines are Approximate)

Subject Photographs

Subject Entrance Typical Subject Exterior

Typical Subject Exterior Typical Subject Exterior

Pool and Courtyard Area Pool and Courtyard Area iii

Subject Photographs

Sports Court Area Courtyard Patio Area

Barbecue Area Subject Entrance from Hotel Circle South

Subject Frontage – Facing West Subject Frontage – Facing East

Subject Photographs

Guest Reception Area Market Pantry

Guest Reception Area Back of House Office Area

Gatehouse Dining Area Gatehouse Kitchen

Subject Photographs

Bar and Lounge Area Common Area Restroom

Back of House Laundry Area Typical Guest Room Corridor

Typical Guest Bedroom Typical Guest Room Living Area

Subject Photographs

Typical Guest Room Kitchen Typical Guest Room Bedroom

Typical Guest Room Living Area Typical Guest Room Restroom

Typical Guest Room Living Area & Kitchen Typical Guest Room Bedroom

vii

Subject Photographs

Typical Guest Room Bedroom Typical Guest Room Interior

Typical Guest Room Interior Typical Guest Room Living Area

Typical Guest Room Bedroom Roof Area

viii

Executive Summary

Executive Summary Property Name Residence Inn by Marriott San Diego Mission Valley Location 1865 Hotel Circle South, San Diego, San Diego County, California 92108

Highest and Best Use As If Vacant Commercial Use As Improved Hotel Property Rights Appraised Fee Simple Estate Date of Report September 17, 2020 Date of Inspection August 13, 2020 Estimated Exposure Time 3-6 Months Estimated Marketing Time 3-6 Months Land Area (Gross Acres) 5.07 AC 220,849 SF Improvements Property Type Hotel (Extended Stay Hotel) Number of Buildings 1 Number of Stories 5 Gross Building Area 135,613 SF Number of Rooms 192 Property Amenities Outdoor pool and whirlpool, outdoor children’s pool, breakfast dining area, 900 square feet of meeting space, fitness center, business center, sport-court, market pantry, vending area, guest laundry, and newly renovated bar and lounge area Year Built 2003 Renovated: 2011, 2018 Condition Good Buyer Profile Institutional Financial Indicators Stabilized Occupancy 88.0% Stabilized Average Daily Rate $180.74 Going-In Capitalization Rate 7.00% Discount Rate 9.00% Terminal Capitalization Rate 7.50%

VALUATION Total Per Room

Market Value As Is On February 25, 2020 Sales Comparison Approach $67,700,000 $352,604 Income Capitalization Approach $68,100,000 $354,688

CONCLUDED MARKET VALUE Appraisal Premise Interest Appraised Date of Value Value As Is Fee Simple Estate February 25, 2020 $68,100,000

Compiled by CBRE

ix Executive Summary

Important Warning - Market Uncertainty from Novel Coronavirus Although the effective date of appraisal for the subject property is February 25, 2020, the outbreak of the Novel Coronavirus (COVID-19), declared by the World Health Organization as a Global Pandemic on March 11th, 2020, is causing heightened uncertainty in both local and global market conditions, as of the date of report. Originating in Wuhan, China, the pandemic continues to develop, and since January 2020 cases have progressively and often aggressively been detected around the world. Global financial markets have seen steep declines since late February largely on the back of the pandemic over concerns of trade disruptions and falling demand. Many countries globally have implemented additional border control measures, strict travel restrictions and a range of quarantine measures.

At this stage the tourism, transportation, F&B and retail sectors have been the most severely impacted, due to the increased response by local and global authorities including home quarantine, restriction of travel and growing international concern. Real Estate investment activity is down as investors largely take a wait and see approach. A prolonged pandemic could have a significant (and yet unknown or quantifiable) impact on certain sectors of the property market.

We note that as of the effective date of appraisal, February 25, 2020, the hotel market was not yet feeling the effects of the COVID-19 pandemic, which began to be felt in the United States market in March 2020. As of the date of report in August 2020, the nation, region, and market area have been materially impacted by the COVID-19 pandemic, which will have a prolonged effect on macroeconomic conditions and corresponding hotel market conditions. Therefore, we note that the valuation conclusions contained herein represent the market conditions as of the effective date of appraisal, prior to the onset of the COVID-19 pandemic, and forecasts/expectations as of February 25, 2020, and as of the date of report in August 2020, market conditions and corresponding values for hospitality properties throughout the country have been materially impacted by the onset of the COVID-19 pandemic.

EXTRAORDINARY ASSUMPTIONS An extraordinary assumption is defined as “an assignment-specific assumption as of the effective date regarding uncertain information used in an analysis which, if found to be false, could alter the appraiser’s opinions or conclusions.” 1

• The As Is value in this report is based on continued Residence Inn by Marriott International, Inc. affiliation, and associated revenue generating potential. • The opinion of value includes the contributory value of the furniture, fixtures, and equipment and assumes the hotel is open and will remain operational.

The use of these extraordinary assumptions might have affected assignment results.

1 The Appraisal Foundation, USPAP, 2020-2021

Executive Summary

HYPOTHETICAL CONDITIONS A hypothetical condition is defined as “a condition, directly related to a specific assignment, which is contrary to what is known by the appraiser to exist on the effective date of the assignment results, but is used for the purposes of analysis.” 2

• None noted

2 The Appraisal Foundation, USPAP, 2020-2021

Table of Contents

Certification ...... i Subject Photographs ...... ii Executive Summary ...... ix Table of Contents ...... xii Introduction ...... 1 Area Analysis ...... 5 Neighborhood Analysis ...... 7 Site Analysis ...... 16 Improvements Analysis ...... 20 Zoning ...... 23 Market Analysis – Macroeconomic ...... 27 Market Analysis – Hotel Market ...... 30 Highest and Best Use ...... 54 Appraisal Methodology ...... 56 Income Capitalization Approach ...... 57 Sales Comparison Approach ...... 83 Reconciliation of Value ...... 88 Assumptions and Limiting Conditions ...... 89 ADDENDA A Comparable Data Sheets B Subject Property Data C Smith Travel Research Report D Client Contract Information E Qualifications

xii

Introduction

OWNERSHIP AND PROPERTY HISTORY Title to the property is currently vested in the name of CHATHAM RIMV LLC, who acquired title to the property in 2011, as part of a five property portfolio. The transaction was recorded in Sale Doc. No. 2011-0370521of the San Diego County Deed Records. The property was built in 2003 and was renovated in 2011, as well as 2018. In addition, a $500,000 public space remodel occurred in early 2020, which created a new bar/lounge area.

To the best of our knowledge, there has been no ownership transfer of the property during the previous three years.

A Letter of Intent to purchase the subject property was executed on August 5, 2020, at a price of $67,000,000. The potential buyer is the San Diego Housing Commission, and the buyer’s intended use is for conversion to affordable housing. The property was not actively marketed for sale, and the buyer approached the seller directly. Based on information provided by property representatives, the contract price is considered to be market-oriented, and the purchase price was based on the market value of the property considering the current revenue generating potential of the current hotel use. We have considered the current Letter of Intent in the valuation analysis.

FRANCHISE AGREEMENT The subject is currently operated as a Residence Inn branded Marriott hotel. The term for the franchise commenced in September 2004 for a term of 20 years.

Note that our value conclusions reflect fair value, which implies that a sale of the subject occurs as of the As Is value date. As such, it is assumed that a new franchise agreement would be negotiated and consummated between the franchisor and buyer at prevailing brand terms.

INTENDED USE OF REPORT This appraisal is to be used for internal decision making purposes, and no other use is permitted.

INTENDED USER OF REPORT This appraisal is to be used by the SAN DIEGO HOUSING COMMISSION (“Client”) and such other parties and entities (if any) expressly recognize by the Client as “Intended Users,” and no other user may rely on our report unless as specifically indicated in the report.

Intended Users - the intended user is the person (or entity) who the appraiser intends will use the results of the appraisal. The client may provide the appraiser with information about other potential users of the appraisal, but the appraiser ultimately determines who the appropriate users are given the appraisal problem to be solved. Identifying the intended users is necessary so that the appraiser can report the opinions and conclusions developed in the appraisal in a manner that is clear and

Introduction

understandable to the intended users. Parties who receive or might receive a copy of the appraisal are not necessarily intended users. The appraiser’s responsibility is to the intended users identified in the report, not to all readers of the appraisal report. 3

PURPOSE OF THE APPRAISAL The purpose of this appraisal is to provide an opinion of the fair value of the subject property.

DEFINITION OF VALUE Fair Value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Source: FASB’S Accounting Standard Codification Topic 820 – Fair Value Measurements

EXPOSURE/MARKETING TIME Current appraisal guidelines require an estimate of a reasonable time period in which the subject could be brought to market and sold. This reasonable time frame can either be examined historically or prospectively. In a historical analysis, this is referred to as exposure time. Exposure time always precedes the date of value, with the underlying premise being the time a property would have been on the market prior to the date of value, such that it would sell at its appraised value as of the date of value. On a prospective basis, the term marketing time is most often used. The exposure/marketing time is a function of price, time, and use. It is not an isolated estimate of time alone. In consideration of these factors, we have analyzed the following:

• exposure periods for comparable sales used in this appraisal; • exposure/marketing time information from the CBRE, Inc. National Investor Survey and the PwC Real Estate Investor Survey Our valuation is predicated on a buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. The COVID-19 pandemic has resulted in logistical constraints on property transactions such as inability to travel for due diligence/tours and closing of municipal agencies for closing/recording sale transactions. In addition, some buyers and sellers have paused or postponed transacting amid the pandemic. However, as the effective date of this appraisal is February 25, 2020, prior to the onset of the COVID-19 pandemic, we have considered marketing and exposure times as of the effective date.

The following table presents information derived from various sources and our conclusion.

3 Appraisal Institute, The Appraisal of Real Estate, 14th ed. (Chicago: Appraisal Institute, 2013), 50.

Introduction

EXPOSURE/MARKETING TIME DATA Exposure/Mktg. (Months) Investment Type Range Average Comparable Sales Data 0.0 - 5.0 4.7 PwC Survey: (1st Qtr. 2020) Luxury 3.0 0- 12. 6.7 Full Service 3.0 - 9.0 6.3 Limited Service 2.0 0- 12. 6.6 Select Service 2.0 0- 10. 4.9 CBRE Exposure Time Estimate 3-6 Months CBRE Marketing Period Estimate 3-6 Months

PwC Real Estate Investor Survey & Situs RERC Real Estate Report

INTEREST APPRAISED The value estimated represents the Fee Simple Estate and is defined as follows:

Fee Simple Estate - Absolute ownership unencumbered by any other interest or estate, subject only to the limitations imposed by the governmental powers of taxation, eminent domain, police power and escheat. 4

SCOPE OF WORK This Appraisal Report is intended to comply with the reporting requirements set forth under Standards Rule 2 of USPAP. The scope of the assignment relates to the extent and manner in which research is conducted, data is gathered and analysis is applied. CBRE, Inc. completed the following steps for this assignment:

Extent to Which the Property is Identified The property is identified through the following sources:

• postal address • assessor’s records • legal description Extent to Which the Property is Inspected CBRE, Inc. inspected both the interior and exterior of the subject, as well as its surrounding environs on the effective date of appraisal. We did not make a detailed inspection of the mechanical systems. We are not qualified to render an opinion regarding the adequacy or condition of these components. The client is urged to retain an expert in this field if detailed information is required.

The property inspection included the following:

• A representative sample of each room type; • public/common areas including lobby, pool area, roof, and back of the house areas.

4 Dictionary of Real Estate Appraisal, 78.

Introduction

This inspection sample was considered an adequate representation of the subject property and is the basis for our findings.

Type and Extent of the Data Researched CBRE reviewed the following:

• applicable tax data • zoning requirements • flood zone status • demographics • income and expense data • comparable data Type and Extent of Analysis Applied CBRE, Inc. analyzed the data gathered through the use of appropriate and accepted appraisal methodology to arrive at a probable value indication via each applicable approach to value. The steps required to complete each approach are discussed in the methodology section.

Data Resources Utilized in the Analysis

DATA SOURCES Item: Source(s): Site Data Size San Diego County Property Assessor Improved Data Building Area Client provided No. Bldgs. Appraiser inspection Parking Spaces Appraiser inspection Year Built/Developed Client provided Economic Data Deferred Maintenance: None Income Data: Owner provided operating statements, market comparables Expense Data: Owner provided operating statements, market comparables Other Zoning Information City of San Diego Title Report Chicago Title Insurance Company Compiled by CBRE

Area Analysis

The subject is located in San Diego County. Key information about the area is provided in the following tables.

POPULATION

The area has a population of 3,318,139 and AREA POPULATION BY AGE 600,000 a median age of 36, ewith th largest 500,000 population group in the 20-29 age range and 400,000 300,000 the smallest population in 80+ age range. 200,000 100,000 0 Source: Esri 0-9 10-19 20-29 30-39 40-49 50-59 60-69 70-79 80+

Population has increased by 222,826 since POPULATION BY YEAR 2010, reflecting an annual increase of 0.7%. 4,000,000 3,000,000 3,318,139 3,418,265 Population is projected to increase by an 3,095,313 additional 100,126 by 2025, reflecting 0.6% 2,000,000 annual population growth. 1,000,000 0 Source: Esri 2010 2020 2025

Area Analysis

INCOME

The area features an average household MEDIAN INCOME BY YEAR income of $110,695 and a median household $100,000 $80,000 $88,959 income of $80,917. Over the next five years, $80,917 median household income is expected to $60,000 $40,000 increase by 9.9%, or $1,608 per annum. $20,000 $0 Source: Esri 2020 2025

EDUCATION A total of 40.0% of individuals over the age of POPULATION BY DEGREE 24 have a college degree, with 24.3% holding a bachelor's degree and 15.6% holding a Bachelor's Degree 24.3% graduate degree. Graduate Degree Other 60.0% 15.6%

Source: Esri

EMPLOYMENT

Health Care/Social Assistance

Prof/Scientific/Tech Services

Educational Services

Manufacturing

Retail Trade

Construction

Accommodation/Food Services

Public Administration

Other Services (excl Publ Adm)

Admin/Support/Waste Mgmt Srvcs

Source: Esri 0% 2% 4% 6% 8% 10% 12% 14% 16%

The area includes a total of 1,424,243 employees and has a 15.5% unemployment rate. The top three industries within the area are Health Care/Social Assistance, Prof/Scientific/Tech Services and Educational Services, which represent a combined total of 35% of the population.

CONCLUSION In summary, the subject is forecasted to experience an increase in population, an increase in household income, and an increase in household values.

Neighborhood Analysis

MISSION VALLEY

PHYSICAL CHARACTERISTICS The subject property is in the "Mission Valley" area of San Diego. Mission Valley was carved by the San Diego River over thousands of years. The area was named for the Spanish Mission that was founded in the river valley over 200 years ago. Today, the San Diego River is contained in a small channel that runs through the heart of Mission Valley. Mission Valley encompasses approximately 2,418 acres of land that parallels the Interstate 8 Freeway. The subject is located immediately south of the I-8 Freeway, between the I-5 Freeway and SR-163 (Cabrillo Freeway). Most of the new development in Mission Valley has occurred in the central and eastern portions of Mission Valley, between the 163 and 805 Freeways, north and east of the subject.

BOUNDARIES The neighborhood general boundaries are detailed as follows:

West: The area's western boundary is Interstate 5 Freeway. Beyond this freeway, a significant change in land uses occurs, dominated by bay oriented features such as Sea World and the Mission Bay recreational area. South: The area's southern boundary is the slopes of Mission Valley. These slopes are generally over 100 feet high, with the area on the top of the bluffs being primarily developed for residential purposes. East: The eastern boundary is Mission Gorge Road. Beyond this road, the San Diego River turns north and the land uses become primarily residential. North: The northern boundary is formed by Friars Road to the west of the 163 Freeway, and the northern slopes of Mission Valley to the east of the 163 Freeway. Again, the valley's northern slopes are generally over 100 feet high, with residential areas on the top of the bluff.

GROWTH PATTERNS Major urban development began to occur in Mission Valley in the late 1950’s primarily as a result of improvements in the regional highway network. The construction of U.S. 80 (later renamed the Interstate 8 Freeway) provided an impetus for commercial development in Mission Valley and for the rapid displacement of the area's previous agricultural economy. This process accelerated when U. S. Highway 395 (now State Route 163), and Interstate 805 were completed in 1971. All of San Diego's major freeways pass through Mission Valley.

With the completion of Interstate 8, the west end of the valley was developed during the late 1950's and 1960's with hotels, golf courses, etc., due to the area's proximity to other recreational and tourist areas such as Mission Bay, Sea World and the San Diego Zoo. The east end of Mission Valley developed sporadically, primarily with low intensity commercial land uses during that time. However, in 1967 the San Diego Jack Murphy (Qualcomm) Stadium was completed,

Neighborhood Analysis which along with the impending completions of Highway 163 and the 805 Freeway, gave rise to more intense commercial developments.

Mission Valley has evolved into an urbanized community. It is primarily a business community with much of its developable land devoted to commercial and office uses. Most of the development has occurred on the north and south sides of the valley, along Friars Road and Interstate 8. The central area of the valley contains the San Diego River. Due to its flooding potential, this area is zoned FW (Floodway), which restricts development in areas subject to inundation. The southern slopes are still primarily in a natural state, while many of the northern slopes have been excavated for sand and gravel extraction.

ACCESSIBILITY Access to Mission Valley is excellent, as it is the junction point between five major freeways. Interstate 8 is an east/west freeway that runs through the center of Mission Valley. The other four freeways all run in a north/south direction and cross through different parts of Mission Valley. Interstate 5 is located on the western side of Mission Valley and acts as the western boundary of the area. Interstate 15 is located on the eastern side of Mission Valley and acts as the eastern boundary of the area. The other two freeways are Interstate 805 and State Highway 163, which both cross through the approximate center of the area.

While freeway access to Mission Valley is excellent, many of the surface streets within the area are overburdened during peak hours. The rapid development experienced during the 1960s and 70s occurred without proper attention to infrastructure needs. The system of surface streets in some areas is barely adequate for current traffic levels and inadequate for future increases. In 1985, a community plan was adopted which attempted to address some of the traffic problems. The implementation of this plan ended an era during which the area essentially had no operant community plan. The community plan addresses the traffic problems by limiting the amount of development that can occur in areas in which the streets are already overburdened.

In accordance with the Mission Valley Community Plan, several improvement projects have been completed, which have improved the traffic congestion in Mission Valley. These projects included road improvements to Stadium Way and Mission Center Road bridges, widening of the I- 8/Highway 163 interchange, the widening and realignment of Camino de la Reina and Camino del Rio North. The major surface streets connecting Mission Valley to the five major freeways include Friars Road, Hotel Circle North, Hotel Circle South, Camino del Rio North, Camino del Rio South, Camino de La Reina, Mission Center Road, and Stadium Way.

TRANSPORTATION The mix of land uses in Mission Valley and the area’s natural topography has led to some significant traffic problems. Although the area has several interchanges with Interstate 8, surface streets in the area are often overburdened because the street grid was not designed for the

Neighborhood Analysis number and intensity of land uses in Mission Valley. This problem is worsened by the need to route traffic circuitously to avoid obstacles such as the San Diego River and interchanging freeways. The presence of the malls and the stadium add to the area's traffic congestion.

A major part of the city's solution to the traffic problems was the original $220 million, 6.1-mile extension of the San Diego Trolley system into the area, which was completed in 1998 and included a dual track line running from existing tracks on the western edge of Mission Valley to San Diego Jack Murphy Stadium. Construction was completed in 2008 on the easterly extension of the Blue Line from just east of Qualcomm Stadium (where it formerly terminated) to La Mesa. The line now links all of Mission Valley to downtown San Diego and Tijuana to the south, and east county, by light rail. There are nine stations in the west Mission Valley line. The stations are meant to encourage ridership within Mission Valley, as it includes stations on Hotel Circle, Fashion Valley Center, Mission Valley Center, Rio Vista, and San Diego Jack Murphy Stadium.

The Trolley stations are serviced by shuttle buses that provide access to all of Mission Valley. Mission Valley also has an existing regional hub of the San Diego Transit bus system, at the Fashion Valley Center. This transportation center offers service within Mission Valley, as well as throughout the county.

LAND USES

RETAIL/COMMERCIAL USES Mission Valley is one of the major regional retail hubs in the San Diego area. Mission Valley Center is the largest regional mall in the area, with 1.5 million square feet. It was built in 1961, renovated in 1981, and recently underwent a $120 million renovation and expansion to include a 20-screen AMC theater complex and several new majors. This is a one-level open mall over one level of parking. The anchors include Target, Macy’s, Bed Bath and Beyond, and Nordstrom Rack; and there are approximately 160 mall shops. The recent renovation involved 100 new shops and 380,000 additional square feet. Bed Bath and Beyond and Nordstrom Rack were also added as part of the renovation and repositioning of the center. The mall is located at the northeast quadrant of the intersection of Interstate 8 and Mission Center Road.

Fashion Valley Center is another regional mall in the area and located at the southwest corner of Route 163 and Friars Road. It was built in 1969, renovated in 1981, and also recently underwent another major renovation. The anchors include J.C. Penney, Neiman-Marcus, Nordstrom, Macy’s, and Bloomingdales, as well as approximately 140 mall shops.

In addition to these regional malls, there are numerous smaller shopping centers located throughout Mission Valley. These include the Hazard Center, Mission Valley Shopping Center – West and Friars-Mission Center shopping center. Hazard Center, located at the southeast corner of Friars Road and Highway 163 contains 135,000 square feet of retail space with 50 shops and restaurants, a 7-plex Mann theater complex, and a 350-room Doubletree Hotel. This project

Neighborhood Analysis also includes a Food 4 Less grocery anchored neighborhood center. Friars-Mission Center shopping center is located north of Friars Road, between Frazee Road and Mission Center Road. This shopping center contains 148,000 square feet of retail space anchored by a Ralph’s grocery, Burger King restaurant, and a Wells Fargo bank branch. Mission Valley Shopping Center – West is a 200,000-square foot power retail shopping center located at the southwest corner of Camino de la Reina and Mission Center Road.

The Park in the Valley and Fenton Marketplace are the newer retail projects to be completed in the valley. Park in the Valley is a 31.7-acre project located on the south side of San Diego River, west of Stadium Way. The 52-acre Fenton Marketplace project is located within the 215-acre Mission City mixed use complex, just west of Qualcomm Stadium, and was completed in mid- 2001. Both centers have adjacent Trolley stops.

OFFICE MARKET The Mission Valley office market was once predominantly comprised of low-rise and garden office buildings. Several high-rise class "A" office buildings were added to the existing inventory in the late 1980s and early 1990s, and the Rio Vista office building was completed in the early 2000’s. These class "A" office buildings have expanded the appeal of the area, attracting the larger "name" tenants as well as the smaller, service oriented tenants. Mission Valley is centrally located, has excellent freeway access, ample parking, abundant retail support services, and excellent access to downtown. The addition of class "A" office buildings, improved traffic flow on the surface streets, and control of the San Diego River has increased the appeal of the area.

RESIDENTIAL DEVELOPMENT San Diego's growth and the proximity of Mission Valley to downtown San Diego also led to a demand for residences in Mission Valley. To date, residential development has almost exclusively included multifamily uses, primarily catering to downtown workers and people who enjoyed being close to Mission Bay and the city's other activity centers. Residential development also occurred in Mission Valley because contiguous areas to the east and west are primarily residential in nature. Some of these multi-family apartment units have been converted to condominiums within the past 10 years, including the River Colony and Missions at Rio Vista (portion) developments. Recently completed apartment units include West Park, Aquatera, and Circa 37, along with Portofino, Promenade Rio Vista, Archstone Mission Valley, and Archstone Presidio View also representing relatively newer complexes (completed approximately 8 to 10 years ago).

New development over the next decade will be focused within the existing 230-acre Civita project area, the proposed Riverwalk and Town and Country redevelopment projects, and the existing Hazard Center complex. Hazard Center involves an expansion of their existing complex to include 473 residences (flats, condos and town-houses) and about 5,000 square feet of commercial space, along with a small public park.

Neighborhood Analysis

Riverwalk Redevelopment

The 200-acre River Walk project involves the redevelopment of the existing golf course with about 4,300 housing units, a new Green Line trolley stop surrounded by retail stores, 1 million square feet of offices hugging Interstate 8 and a 70-acre park along the San Diego River. The first phase would be residential construction along Friars Road (Sunset 9-hole portion only), with at least one new intersection for drivers turning south toward the retail hub and new trolley station.

Earliest construction would be 2020, with 15 to 20 years required for full completion.

CIVITA PROJECT

Civita is a 230-acre development site approved for a mix of residential, retail, office/business park uses, parks, and a school. The site is generally located on the north side of Friars Road, between Mission Center Road and the 805 freeway. The site was operated for the past 70 years as a sand and gravel quarry and has been owned by the Grant family for more than the past 50 years. The Quarry Falls Specific Plan was adopted by the San Diego City Council on October 21st, 2008 by City Council Resolution R-304293 after approximately 8 years in the application process.

Land uses proposed as part of Civita include approximately 31.8 acres of public parks, civic uses, open space and trails; a maximum of 4,780 residential units offered as a variety of “for sale” and/or “for rent” and built as condominiums, town homes, apartments and/or flats, row homes, courtyard units, lofts, live/work units, carriage units (dwelling units on one or more floors located above a private garage), senior housing and assisted care units; a maximum of 480,000 square feet of retail space; and a maximum of 420,000 square feet of office/business park uses. Additional land uses provided within Civita include an option for a school. Projects completed to date include the Circa 37 and West Park apartment projects, and several for-sale condominium projects.

Recreational

Mission Valley is a major regional entertainment hub within San Diego County. Recreational amenities include two golf courses, and SDCCU Stadium (formerly Qualcomm Stadium), which opened in 1967 and is the home of the San Diego State football team (and formerly the San Diego Chargers). The 162-acre site is proposed with redevelopment with a new (smaller) football stadium surrounded by dense urban infill residential, commercial uses, and a regional park.

HOTEL Mission Valley is a premier hotel area of San Diego. The combination of the improving economy (prior to the onset of the COVID-19 pandemic) and continued development of Mission Valley into a major metropolitan area of San Diego has renewed interest in development of new hotels. Redevelopment of the Qualcomm site will likely include hotel uses.

Neighborhood Analysis

EMPLOYMENT Mission Valley is a major employment center of San Diego. The major employers include businesses occupying space in office buildings and the two regional shopping centers. Mission Valley has a total of 6.5 million square feet of office space making it the second largest office submarket in San Diego. Mission Valley is also a visitor center with a large number of hotels and excellent freeway accessibility to tourist attractions, such as Mission Bay, Sea World and Balboa Park.

DEMOGRAPHICS Selected neighborhood demographics in 1-, 3-, and 5-mile radii from the subject are shown in the following table:

SELECTED NEIGHBORHOOD DEMOGRAPHICS 1865 Hotel Circle South 92108 - San San Diego- 1 Mile Radius 3 Mile Radius 5 Mile Radius San Diego County San Diego, CA 92108 Diego Carlsbad, CA Population 2025 Total Population 21,717 176,665 524,423 25,226 3,418,265 3,418,265 2020 Total Population 18,783 167,800 504,341 22,504 3,318,139 3,318,139 2010 Total Population 17,074 152,363 471,721 18,243 3,095,313 3,095,313 2000 Total Population 15,720 143,015 455,124 13,013 2,813,833 30,982 Annual Growth 2020 - 2025 2.95% 1.03% 0.78% 2.31% 0.60% 0.60% Annual Growth 2010 - 2020 0.96% 0.97% 0.67% 2.12% 0.70% 0.70% Annual Growth 2000 - 2010 0.83% 0.64% 0.36% 3.44% 0.96% N/A Households 2025 Total Households 11,583 84,286 230,484 13,548 1,194,461 1,194,461 2020 Total Households 9,883 79,674 220,035 12,052 1,160,040 1,160,040 2010 Total Households 9,039 71,966 204,428 10,039 1,086,865 1,086,865 2000 Total Households 8,585 66,421 192,548 7,410 994,677 994,677 Annual Growth 2020 - 2025 3.23% 1.13% 0.93% 2.37% 0.59% 0.59% Annual Growth 2010 - 2020 0.90% 1.02% 0.74% 1.84% 0.65% 0.65% Annual Growth 2000 - 2010 0.52% 0.81% 0.60% 3.08% 0.89% 0.89% Income 2020 Median Household Income $83,609 $77,235 $72,372 $81,076 $80,917 $80,917 2020 Average Household Income $115,815 $103,889 $101,050 $102,132 $110,695 $110,695 2020 Per Capita Income $60,613 $50,138 $44,738 $54,739 $39,060 $39,060 2020 Pop 25+ College Graduates 9,487 69,921 179,845 9,863 897,606 897,606 Age 25+ Percent College Graduates - 2020 63.3% 55.1% 49.4% 56.9% 40.0% 40.0% Source: ESRI Conclusion The subject is in a densely populated, established area with good access to all major San Diego freeways. Mission Valley is a major office employment center and retail hub and provides residents very close commute proximity to most other major central county employment centers. Due to its central location within the county, convenient freeway access, and minimal vacant land in the area, the long-term outlook for the Mission Valley area is positive for commercial uses, despite near term impact from the COVID-19 pandemic.

Site Analysis

PLAT MAP

Site Analysis

SITE SURVEY

Site Analysis

The following chart summarizes the salient characteristics of the subject site.

SITE SUMMARY AND ANALYSIS

Physical Description Gross Site Area 5.07 Acres 220,849 Sq. Ft. Net Site Area 5.07 Acres 220,849 Sq. Ft. Primary Road Frontage Hotel Circle 100 Feet Shape Irregular Topography Slightly sloping (see discussion)

Zoning District C-O-2-2: Commercial Office Zone 2-2

Flood Map Panel No. & Date 06073C1618G 16-May-12 Flood Zone Zone X Adjacent Land Uses Commercial uses Earthquake Zone No

Comparative Analysis Rating Visibility Good (freeway) Functional Utility Assumed adequate Traffic Volume Moderate Adequacy of Utilities Assumed adequate Landscaping Average Drainage Assumed adequate

Utilities Provider Adequacy Water San Diego Water District Yes Sewer San Diego Water District Yes Natural Gas SDG&E Yes Electricity SDG&E Yes Telephone MCI Yes Mass Transit Metropolitan Transit Authority Yes

Other Yes No Unknown Detrimental Easements X Encroachments X Deed Restrictions X Reciprocal Parking Rights X Source: Various sources compiled by CBRE

LOCATION The subject is located on the south side of the I-8 Freeway between the I-5 Freeway and SR-163 (Cabrillo Freeway). The street address is 1865 Hotel Circle South.

ASSESSOR’S PARCEL NUMBER The San Diego County Tax Assessor’s parcel number is as follows: 443-040-39-00.

16 Site Analysis

LAND AREA The land area size was obtained via San Diego County records. The site is considered adequate in terms of size and utility. There is no unusable, excess or surplus land area. We note that a portion of the site is comprised of sloped undeveloped land area.

SHAPE AND FRONTAGE The site is irregular in shape and has limited frontage (100 Feet) along Hotel Circle South; however, access is considered to be adequate.

INGRESS/EGRESS Ingress and egress is available to the site along Hotel Circle South via a single cub-cut driveway. The access point leads to the site’s surface parking lot that surrounds the subject improvements.

TOPOGRAPHY AND DRAINAGE The developed portion of the subject site features various slight sloping, and the southern undeveloped portion of the site features more steeply sloped topography, with retaining walls in place. The topography of the site is not seen as an impediment to the development of the property. During our inspection of the site, we observed no drainage problems and assume that none exist.

SOILS A soils analysis for the site has not been provided for the preparation of this appraisal. In the absence of a soils report, it is a specific assumption that the site has adequate soils to support the highest and best use.

EASEMENTS AND ENCROACHMENTS We have been provided with a title report dated April 11, 2011, prepared by Chicago Title Insurance Company. The report revealed various access and utility easements on the subject property as well as an open space easement and future street easement. In addition, the report delineates various encroachments onto the subject property including chain link fences, concrete gutters, sewer lines, above ground drain pipes, block walls, and wood fence, among others. Based on information provided by property representatives, the property does not appear to be adversely affected by any easements or encroachments. It is recommended that the client/reader analyze a current title policy outlining all easements and encroachments on the property, if any, prior to making a business decision.

COVENANTS, CONDITIONS AND RESTRICTIONS We have been provided with a title report dated April 11, 2011, prepared by Chicago Title Insurance Company. The report reveals various exceptions to Title including a Resource Protection

Site Analysis

Ordinance, Property Grading Agreement, Joint use Agreement, Notice of Consent to Use Land, and Encroachment Maintenance and Removal Agreement, among others. Based on information provided by property representatives, the property does not appear to be adversely affected by any covenants, conditions, or restrictions. There are no known covenants, conditions and restrictions impacting the site that are considered to affect the marketability or highest and best use.

ENVIRONMENTAL ISSUES We were not provided with a Phase I Environmental Site Assessment. CBRE has not observed, yet is not qualified to detect, the existence of potentially hazardous material or underground storage tanks that may be present on or near the site. The existence of hazardous materials or underground storage tanks may influence the value of the property. For this appraisal, CBRE has specifically assumed that any hazardous materials and/or underground storage tanks that may be present on or near the property do not affect the property.

CONCLUSION The site is afforded very good access and exposure to major roadways. The size of the site is typical for the area and use, and there are no known detrimental uses in the immediate vicinity. Overall, there are no known factors that prevent the site from development to its highest and best use, as if vacant, or adverse to the existing use of the site.

Site Analysis

FLOOD PLAIN MAP

Improvements Analysis

The following chart shows a summary of the improvements.

IMPROVEMENTS SUMMARY AND ANALYSIS Property Type Hotel (Extended Stay Hotel) Number of Buildings 1 Number of Stories 5 Year Built 2003 Renovated: 2011, 2018 Gross Building Area 135,613 SF Number of Guest Rooms 192 Property Amenities Outdoor pool and whirlpool, outdoor children’s pool, breakfast dining area, 900 square feet of meeting space, fitness center, business center, sport-court, market pantry, vending area, guest laundry, and newly renovated bar and lounge area Elevators 4 Guest Sprinklers/Smoke Detectors Yes Site Coverage 12.3% Land-to-Building Ratio 1.63 : 1 Parking Spaces: 186 ROOM TYPE MIX Percent of Room Type Size No. Rooms Total One-Bedroom King Suite 550 SF 92 47.9% One-Bedroom Queen Suite 561 SF 60 31.3% Two-Bedroom Family Suite 650 SF 24 12.5% Two-Bedroom Suite 744 SF 16 8.3% Total: 192 100.0% Source: Various sources compiled by CBRE

The Residence Inn consists of a one-story Gatehouse and a 4- and 5-story, interior-corridor “U” shaped building. The East and West wings are four-stories, while the South connector is five- stories. The lobby, registration area, meeting space, fitness center, business center, bar/lounge, and breakfast area are located in the Gatehouse. Guestrooms are located in the East, West and South wings surrounding the ground level pool area.

ROOM MIX The one-bedroom suite features one bedroom with a separate living room and complete kitchen. The two-bedroom family suite features two-bedrooms with one furnished for children, a separate living room and complete kitchen. The two-bedroom suite features two-bedrooms, a separate living room and complete kitchen. The subject property contains a relatively high percentage of 2 bedroom suites (20.8%), and contains a relatively large average room size of 582 square feet.

20 Improvements Analysis

FUNCTIONAL UTILITY The current design characteristics of the subject appear to meet modern standards. All of the floor plans are considered to feature functional layouts and the overall layout of the property is considered functional in utility. The unit mix appears functional and no conversion is warranted.

ADA COMPLIANCE All common areas of the property appear to have handicap accessibility. The client/reader’s attention is directed to the specific limiting conditions regarding ADA compliance.

ENVIRONMENTAL ISSUES CBRE, Inc. is not qualified to detect the existence of any potentially hazardous materials such as lead paint, asbestos, urea formaldehyde foam insulation, or other potentially hazardous construction materials on or in the improvements. The existence of such substances may affect the value of the property. For the purpose of this assignment, we have specifically assumed there are no hazardous materials that would cause a loss in value to the subject.

CAPITAL EXPENDITURES The subject underwent extensive renovations in 2018, at a reported cost of $3.3 million, or $17,188 per room. The renovation included a full room interior renovation, as well as exterior renovations. In addition, a $500,000 public space renovation occurred in early 2020, which created a new bar/lounge area in the gatehouse. Property management reported no significant proposed capital expenditures.

ECONOMIC AGE AND LIFE CBRE, Inc.’s estimate of the subject improvements effective age and remaining economic life is depicted in the following chart:

ECONOMIC AGE AND LIFE Actual Age 17 Years Effective Age 10 Years MVS Expected Life 45 Years Remaining Economic Life 35 Years Accrued Physical Incurable Depreciation 22.2% Compiled by CBRE The remaining economic life is based upon our on-site observations and a comparative analysis of typical life expectancies as published by Marshall and Swift, LLC, in the Marshall Valuation Service cost guide. While CBRE, Inc. did not observe anything to suggest a different economic life, a capital improvement program could extend the life expectancy.

Improvements Analysis

PARKING The subject site features 186 surface parking spaces. The surface parking lot surrounds the building improvements on all sides.

CONCLUSION Based on the data we have been provided and obtained, we believe the improvements are in good overall condition. The subject property offers good functional utility and contains a relatively high percentage of 2 bedroom suites (20.8%), and contains a relatively large average room size of 582 square feet. Overall, there are no known factors that adversely impact the marketability of the improvements.

22 Zoning

Zoning

The following chart summarizes the subject’s zoning requirements.

ZONING SUMMARY Current Zoning C-O-2-2, Commercial Office Zone 2-2 Legally Conforming Yes Uses Permitted Hotel, medical and professional office, industrial, retail, restaurant, commercial services, traditional housing (6 or fewer residents), vocational/trade schools, energy generation & distribution facilities, private clubs, lodges, and fraternal organizations, among other uses. Zoning Change Not likely Category Zoning Requirement Minimum Lot Size 5,750 Sq. Ft. Minimum Lot Width 50 Feet Maximum Height 45 Feet Minimum Setbacks Side Yard 10 Feet Rear Yard 10 Feet Minimum Bldg. Coverage 35% Maximum Residential Density 15,000 Maximum FAR/Density 2.00 : 1 Subject's Actual FAR 0.61 : 1 Parking Requirements 96 spaces Subject's Actual Parking 186 spaces Source: Planning & Zoning Dept., Zoning Report prepared by Zoning Research Group, dated 8/13/2020

ANALYSIS AND CONCLUSION The subject site is located within the Mission Valley Community Plan Area. The subject zoning designation is CO-2-2: Commercial Office Zone 2-2, and proposed developments inconsistent with the provided community plan area land use designation will be required to apply for a community plan amendment.

Additional information may be obtained from the appropriate governmental authority. For purposes of this appraisal, CBRE has assumed the information obtained is correct.

Zoning

ZONING MAP

Tax and Assessment Data

TAX AND ASSESSMENT DATA In California, privately held real property is typically assessed at 100% of full cash value (which is interpreted to mean market value of the fee simple estate) as determined by the County Assessor. Generally, a reassessment occurs only when a property is sold (or transferred) or when new construction occurs (as differentiated from replacing existing construction). In the case of long- term ground leases, the general rule is that a reassessment is made at the time of assigning or terminating a lease where the remaining term is more than 35 years. For reassessment purposes, the lease term includes all options to extend. Assessments for properties that were acquired before the tax year 1975-1976 were stabilized as of the tax year 1975-1976. Property taxes are limited by state law to 1% of the assessed value plus voter-approved obligations and special assessments. If no sale (or transfer) occurs or no new building takes place, assessments may not increase by more than 2% annually. Taxes are payable in two equal installments, which become delinquent after December 10 and April 10, respectively. The following table summarizes the assessment values.

AD VALOREM TAX INFORMATION Assessor's Market Value Parcel Description 2019 Pro Forma 443-040-39-00 1865 Hotel Circle $62,098,062

Total Assessor's Market Value $62,098,062 $67,965,971

Assessed Value @ 100% 100% $62,098,062 $67,965,971

General Tax Rate (per $100 A.V.) 1.231990 1.231990

General Tax: $765,042 $837,334 Special Assessments: 381 381

Effective Tax Rate (per $100 A.V.) 1.232604 1.232551

Total Taxes $765,423 $837,715

Source: Assessor's Office

POTENTIAL FUTURE TAX ASSESSMENT CHANGES The subject’s projected assessments and taxes upon sale are based on California’s current “Proposition 13” methodology. Future assessments and taxes would change if a November 2020 ballot initiative is passed by the state’s voters. If the ballot initiative fails, the current “Proposition 13” methodology will continue. The initiative information below was gathered from the website Ballotpedia.

Tax and Assessment Data

Their summary states that if passed, the initiative:

Taxes certain commercial and industrial real property based on fair-market value—rather than, under current law, the purchase price with limited inflation. Exempts agricultural property and certain small businesses. Dedicates portion of any increased revenue to local services and to supplement, not replace, state’s minimum-funding guarantee to schools. Provides tax exemption for $500,000 worth of tangible personal property used for business and all personal property used for certain small businesses.

The entire ballot initiative (#19-0008) is complex, has not been legally tested, may have unexpected effects on market prices, and has different rules for different property types. It would create a so-called “split roll”, because residential properties would be taxed using “Proposition 13” methodology while commercial and industrial properties would be assessed based on market value and not purchase price. Additionally, there are numerous tests, processes, hurdles, definitions, phase-ins, etc. that would need to be understood and considered to accurately determine a particular property’s annual tax bill.

Proceeds from the additional property tax revenue are projected in the initiative as follows:

Net increase in annual property tax revenues of $6.5 billion to $10.5 billion in most years, depending on the strength of real estate markets. After paying for county administrative costs and backfilling state income tax losses related to the measure, the remaining $6 billion to $10 billion would be allocated to schools (40 percent) and other local governments (60 percent).

This brief description of a potential change in real property taxation methods in California has been provided to notify the reader. The reader should investigate further if desired. Given the initiative’s unknown effect on market prices, its complexities, the potential of legal challenges, etc. we have not attempted to estimate the subject property’s future property taxes assuming this initiative passes.

SIOCONCLU N Based on the most recent tax bill, there are no noted delinquent real estate taxes associated with the property. For purposes of this analysis we are assuming any outstanding property tax liability has been paid and CBRE assumes that all taxes are current. If the subject sold for the value estimate in this report, a reassessment at that value would most likely occur, with tax increases limited to two percent annually thereafter until the property is sold again. The consequences of this reassessment have been considered in the income capitalization analysis to follow

Market Analysis

Market Analysis – Macroeconomic

We note that this market analysis considers conditions and projections as of the effective date of appraisal in February 2020, prior to the onset of the COVID-19 pandemic, and the subject lodging market has been substantially impacted in March-August 2020 by the effects of the pandemic.

ECONOMIC IMPACT OF COVID-19 As of the current date of value and the date of this report, the nation, region, and market area are being impacted by the COVID-19 pandemic. In this section we provide a brief overview of the observed and anticipated impacts of COVID-19 from a macroeconomic perspective based on various CBRE sources. For further and updated information, please visit CBRE’s resource center at https://www.cbre.com/covid-19.

In this section, we present the “House View” developed by CBRE Econometric Advisors (CBRE-EA). CBRE-EA has revised its global GDP estimates to project significant negative growth in the short term, followed by a relatively rapid recovery in late 2020/early 2021, but with a slightly negative longer-term impact as illustrated below:

As shown in the following graphs, CBRE-EA projects negative growth for 2020 but an increased rate of growth for 2021. CBRE-EA is projecting a

Market Analysis return to economic growth in Q3 2020 that should lead to a reasonably quick fall in unemployment in the U.S., though not to the level seen just prior to the crisis. Unemployment has historically been highly correlated with vacancy; the following chart illustrates historical trends for unemployment and all-property vacancy rates in the U.S.

KEY TAKEAWAYS & OBSERVATIONS The following points summarize key points from CBRE-EA and CBRE’s Americas Research:

• The brunt of the impact from COVID-19 is anticipated in the near term. Macroeconomic projections are for stabilization in Q3 2020 and recovery in Q4 followed by stronger growth in 2021.

• The labor market will come under significant strain in coming weeks and months as many workers, especially non-salaried service employees, forfeit hours and wages. A record number of Americans have filed for unemployment. U.S. unemployment is estimated to have risen to 10.5% from its historic low of 3.5% just before the crisis. Unemployment will decline rapidly but may take 24-36 months to fall back to pre-crisis levels.

• The Fed’s role in stabilizing the U.S. economy has been immense, including purchases of corporate debt at levels not seen in the Great Financial Crisis. The Fed’s balance sheet has jumped to $6 trillion from $4 trillion in three months.

• Real estate typically lags macroeconomic indicators and could see a “swoosh-shape” recovery. COVID-19 will impact various industries differently. CBRE-EA is currently anticipating a phased recovery with impacts varying by property type with industrial projected to quickest recovery followed by office and then retail.

Market Analysis

• Capital values are viewed to be broadly resilient over a 24-36 month horizon, with significant variation based on sector, location and profile.

• Pent-up demand and simulative policy are expected to aid a rapid recovery.

• The U.S. has announced plans for a phased economic reopening of certain regions. This is reflected in CBRE’s forecasts of economic stabilization in Q3 and recovery in Q4 for the U.S. and the global economy.

• Commercial real estate debt markets have been evolving rapidly and dramatically since the COVID crisis. Initially, 10-year Treasury and LIBOR indexes fell to sub-1% levels, followed by massive spikes in loan spreads that largely followed the broader credit markets. Following recent policy interventions, loan spreads narrowed by about 50 to 100 basis points. Commercial mortgage rates range from 3.5% to more than 4% for most conservatively underwritten deals; value-add and riskier deals are seeing widened spreads and higher overall rates. Adequate capital still exists from banks, life companies and the GSEs, while the CMBS market remains in recovery mode and debt funds vary depending on their capital sources.

• In addition to market uncertainty, government, company and individual social distancing mandates may impact property inspections resulting in extended due diligence periods.

• A bounce back is already being seen in Asia Pacific. In China, consumption continues to rebound, supported by a spike in “revenge spending” by shoppers emerging from lockdown.

MACROECONOMIC CONCLUSIONS In general, market participants are expecting a rebound between the second half of 2020 and first half of 2021. Fiscal and monetary supply for the economy have been unprecedented and, together with pent-up demand, are expected enable a relatively rapid return to normalcy once health-oriented concerns are alleviated. If a second wave of the virus can be avoided or managed effectively, high rates of growth can be expected in 2021. A "V" or "U" shaped recovery is broadly anticipated for the broad economy, whereas real estate is likely to lag somewhat with a “swoosh” shaped recovery expected. There will be short term disruptions that will impact rent collections, near-term vacancies, rent growth, and lease-up across most property types. The impact and recovery will vary by city and by property type. Overall, market participants are indicating a pause in sale and lease transactions as buyers and tenants navigate this period of uncertainty.

Market Analysis

Market Analysis – Hotel Market

NATIONAL HOTEL MARKET SUMMARY The following overview was derived primarily from CBRE Hotels Research, CBRE Econometric Advisors (CBRE EA), data from Smith Travel Research (STR), and a recently published article by CBRE EA, entitled, “COVID-19 and the Implications to the Lodging Sector.”

The COVID-19 global pandemic, which was initially believed to have a limited effect on the lodging market, has since turned into the largest disruption in the contemporary era. Gross Domestic Product (GDP) fell 4.8% at an annual rate, driven by large reductions in consumption of services and durable goods in Q1. Preliminary data suggest that 20.5 million jobs were lost in April, sending the unemployment rate to 14.7%. A two-year employment recovery means roughly the same for lodging demand.

Inflation as measured by the Consumer Price Index (CPI) rose to 2.1% in Q1; however, falling demand due to social distancing measures portends downward pressure on prices. CBRE EA forecasts CPI to remain below levels seen in Q1 until 2021. Any changes to ADR in 2020 will reflect real value changes rather than nominal changes only. Recent measures adopted by world governments to slow the spread of the coronavirus have resulted in an especially pronounced effect in the lodging sector. Additionally, uncertainty about the duration of the downturn is elevated, with the most likely scenarios leading to recovery in 8-16 quarters.

The following chart illustrates the magnitude the COVID-19 Pandemic has had on U.S. unemployment levels relative to past economic cycles over the past 40 years. As shown, the COVID-19 Pandemic has profoundly impacted the economic cycle unlike anything seen in modern history.

Market Analysis

Spurred by the COVID-19 pandemic, the U.S. lodging sector has been hit by two headwinds in 2020: a contraction in overall economic activity and the need for social distancing. Accordingly, CBRE’s June 2020 forecast calls for a 37% reduction in the number of room nights occupied in 2020 compared to 2019. The resulting 38% decrease in occupancy, combined with a forecast 22.5% drop in ADR, results in a projected annual decline in RevPAR of 51.9% during 2020.

Based on CBRE’s June 2020 forecast, the pace of decelerating occupancy, ADR, RevPAR and demand begins to lessen during the third quarter of 2020. By the second quarter of 2021, we anticipate year-over-year growth in occupancy, ADR, RevPAR and demand. In general, drive-to leisure destinations will be the first markets to show signs of recovery. Interstate hotels have also exhibited the greatest occupancy resiliency. This confirms that there is a level of commerce that continues to travel along the nation’s highways, as well as the sense of health security one feels when driving in their own car. Hotels that are oriented toward group meetings will likely lag in recovery. The following table illustrates historical and forecasted quarterly RevPAR change.

Year-Over-Year U.S. RevPAR Change (Quarterly)

Source: Forecast Hotel Data - CBRE Hotels Research (dated 5/14/2020), Historical Hotel Data - STR, Q1 2020.

The expected declines in RevPAR will be worse than experienced in the 2001 and 2009 economic downturns combined. However, given the expected quick rebound in economic growth and historic resiliency of travel demand, we forecast a strong hotel revenue recovery during 2021 and

Market Analysis

2022 and that RevPAR could return to prerecession levels by early 2023. The three-year recovery in nominal RevPAR will be driven by the relatively quicker rise in occupancy. The demand for U.S. lodging accommodations will return to pre-recession levels in the third quarter of 2022. ADR, on the other hand, will lag in its recovery until 2024. As illustrated in the following chart, declines in U.S. hotel performance are stabilizing, with modest improvements in early-May 2020.

The Demand for Travel Stays in hotels, short-term rentals, and on cruise ships are driven by leisure and the need for face-to-face business meetings. People avoid travel when they feel unsure about their future financial state (constraint #1) and when they feel afraid to make trips (constraint #2). In the wake of the 2008 financial crisis, for example, future cash flow and wealth uncertainties severely impacted travel. Fear of travel is a broader and more complicated phenomena than financial insecurity. Following the tragic 9/11 events, for example, potential travelers avoided boarding airplanes for fear of being entangled in terrorist acts.

The most complex constraint impairing travel comes from the fear of contracting communicable diseases or infections. The world has recently experienced outbreaks of several forms of transmissible viruses such as SARS, Ebola, and H1N1 (Swine Flu). These illnesses took a large human toll, but while the effects on the paid accommodation industry were measurable, they were not devastating. COVID-19 virus is more dangerous, so the travel industry is braced for a huge reduction in business and leisure trips.

During the COVID-19 period, which the World Health Organization (WHO) has designated a global pandemic, all markets are expected to be impacted as social distancing continues.

Market Analysis

Estimating Market and Chain Scale Impacts

We expect the impact to be greatest in gateway cities that cater to international and business travelers, and that accommodate large groups for conventions and conferences. Similarly, 9/11 primarily impacted these same markets and spared many drive-to markets.

Markets that have their peak season during the spring (March-May) will also see a more severe impact since these months can generate a significant portion of their full year revenues and profits. U.S. hotels average about 5% more revenue during the spring travel season. These hotels will not only realize the same declines in occupancy that most markets will see, but also lose out on the large ADR (room rate) premium hotels were able to charge during the peak time.

The following chart illustrates year-over-year performance data for the top 25 metro areas for the week of May 3, 2020.

Urban and Resort locations have borne the brunt of impact so far. As the pandemic progresses, all locations will experience significant declines. The following chart illustrates the 7-day moving average occupancy level across all location types. As shown, occupancy levels appear to have bottomed out with very modest growth seen in recent weeks.

Market Analysis

Not all chain scales will feel the impact evenly. Luxury and Upscale properties have been affected the most because of their dependency on group, business, and international visitations. Luxury, Upper Upscale, and Upscale properties also took the brunt of the deductions in demand during previous downturns including the aftermath of the 9/11 attacks in the U.S. and the Great Financial Crisis. The following table shows recent ADR trends across all chain scales from February 23rd through May 8th.

Market Analysis

Outlook Our outlook anticipates a sharp and pervasive decline in lodging demand throughout 2020, with the most severe declines during Q2. A decline in demand of 37.0% will be the primary impact of lodging performance. ADRs are also expected to decline 22.5% for the year. The 51.9% decline in RevPAR is the largest decline the U.S. lodging industry has realized since we started collecting data in the 1930s. Q2 2020 is forecasted to bear the brunt of RevPAR losses with year-over-year declines estimated to reach near 70%. The following chart summarizes the five-year history and forecast for the U.S. hotel market.

FIVE YEAR HISTORY AND FORECAST (ANNUAL)

Source: Forecast Hotel Data - CBRE Hotels' Americas Research, Historical Hotel Data - STR, Q1 2020.

The introduction of wide-spread and substantial government and central bank support policies is expected to help companies survive a difficult Q2 and drive the recovery from Q3 onwards. If containment efforts are successful and people are permitted to begin traveling again by Q3, we expect a swift recovery as the fundamental reasons for travel remain strong and consumers of travel have pent-up demand to leave the house. Our outlook shows that RevPAR will almost recover to 2019 levels by early 2023, but not before losing over $100 billion in rooms revenue alone by 2022 based on pre-COVID-19 forecasts.

Impact on Profits To provide context to the expected declines in profits for U.S. hotels during 2020, we analysed the operating performance of properties during 11 economic recessions from 1938 through 2009. By far the greatest declines in revenues and profits were experienced by U.S. hotels during the two most recent recessions, which more closely mirror our expectations for the year ahead.

In 2001, of the properties in our sample that experienced a decline in RevPAR, only 2% saw RevPAR fall by more than 30%. On average, these properties suffered a 35.3% drop in total

Market Analysis revenue which resulted in a 54.2% decline in gross operating profit (GOP). During the 2009 recession, 10.2% of the properties that experienced a decline in RevPAR saw their rooms revenue drop by more than 30%. On average, these properties also suffered a 35.3% drop in total revenue, but the decline in GOP averaged 57.0%.

Concurrently, we relied on the historical relationship between declines in RevPAR to estimate the potential decreases in profits. For example, a 20.0% decline in RevPAR for a full-service hotel during 2009 resulted, on average, in a 39.0% decline in gross operating profits (GOP) and a 52.0% drop in earnings before interest, taxes, depreciation and amortization (EBITDA). As the forecast updates have progressed, the magnitude of the projected declines in RevPAR have surpassed anything our firm has seen while tracking U.S. hotel performance the past 90 years. Based on CBRE’s May 11, 2020 forecast, the U.S. lodging industry is projected to achieve an annual occupancy level of 41.0% in 2020. To put this in perspective, the lowest annual occupancy level ever achieved by the CBRE Trends® sample was 44.5% in 1933. At the low levels of occupancy currently forecast for 2020, hotel owners and operators have responded by reducing their fixed costs as much as possible and spending just a minimal amount on the variable costs. As expected, there is a correlation between the occupancy level and the achieved profit margins. The lower the occupancy level, the lower the GOP and EBITDA margins.

Fortunately, we are in a low inflation period which should help keep the costs of goods, services, and utilities low. Further, recent changes in Food and Beverage operations and marketing practices have helped to lower fixed operating costs. The following chart illustrates U.S. hotel performance by chain-scale groups based on the projected 2020 annual occupancy level.

Market Analysis

While it is no solace, U.S. hotels entered this recession in a much more profitable position than past recessions. Occupancy levels reached another record high in 2019 and profit margins were 450 bps greater than the long-run average. We expect challenging times ahead for the U.S. lodging industry but believe travel and the services associated with it will once again recover and quickly outpace historical peaks once this pandemic is eradicated.

Investment Activity According to Real Capital Analytics (RCA) 1Q 2020 US Capital Trends – Hotel report, “The hotel sector is bearing the brunt of the economic crisis wrought by the new coronavirus. Deal activity is falling rapidly as building owners and potential buyers do not want to do deals when nobody is sure what happens next. The headline figures for the market make conditions actually look better than the reality”. Several highlights as published by RCA are provided below:

• ‘Deal volume had fallen at double-digit rates each month starting in November 2019. The cumulative effect was to push deal volume for Q1’20 below the $5b mark. The last time the market saw so little activity in a quarter was 2012 when the aftereffects of the Global Financial Crisis were still rippling through the market. Conditions in March suggest even harsher conditions ahead.’ • ‘Transaction activity fell 56% YOY in March with volume less than $1b. The worst month historically for the hotel sector was April 2009 when only $127m in properties traded hands.’ • ‘One bright note for the quarter was an increase in portfolio sales. Such deals were up 49% from a year earlier on sales of $1.5b. Individual asset sales fell at a 56% YOY pace for Q1’20 and at a 73% YOY pace for March.’ • ‘Activity is not likely to pick up much because pricing has not fully adjusted to the current environment.’ • ‘The hotel sector is different from other property types in a Cap Rates number of ways, but one critical difference is that cap rates were already rising in the environment of falling interest rates. After hitting a low of 8.1% for this cycle in early 2015, hotel cap rates rose for two years and have bounced around between 8.6% and 8.8% since. Hotel cap rates averaged 8.7% in Q1’20.’ • ‘By segment type, cap rates for full-service hotels averaged 7.9% in Q1’20 while those for limited-service hotels averaged 8.8%. In both cases, these levels are not the highs seen in this cycle. Limited-service cap rates peaked at 9.2% in 2017 while those for full-service properties peaked at 8.1% in 2016. Cap rate increases from the current levels would likely go higher than those previous peaks if the impact to hotel revenue from the economic crisis is long- lived.’ • ‘With income for hotels hampered both in the short term from the stay-at-home orders and in the intermediate term from reduced consumer activity in the recession, momentum will be behind cap rate increases.’

Investment Rates Investment rate data from the latest Real Estate Investor Surveys published by PWC and RERC for hotel properties are illustrated in the following table:

Market Analysis

HOTEL INVESTOR SURVEY DATA Discount Rate Overall Cap Rate Terminal Cap Rate Source/Type Range Average Range Average Range Average RERC (Q4 2019) Hotels 9.50% - 10.40% 10.00% 7.00% - 8.30% 7.90% 8.70% - 9.00% 8.80% PwC Survey: (1st Qtr. 2020) Luxury 6.25% - 12.00% 9.30% 4.00% - 9.50% 7.05% 5.50% - 9.50% 7.53% Full Service 8.50% - 11.00% 9.95% 6.00% - 9.00% 7.38% 7.00% - 10.00% 8.25% Limited Service 7.50% - 12.00% 10.00% 7.50% - 11.00% 9.10% 7.75% - 12.00% 9.33% Select Service 8.00% - 12.00% 10.00% 6.00% - 10.00% 8.15% 7.00% - 10.00% 8.43% Compiled by: CBRE According to PwC, as of 1st Qtr. 2020, the luxury/upper-upscale segment experienced a decline in discount rates of 25 basis points as compared to the 1st Qtr. 2019 survey, with no change in overall capitalization rate. For the full-service segment, discount rates were up by 25 basis points, while overall capitalization rates were down by 5 basis points. The select-service segment experienced declines in discount rates (-10 basis points) and overall capitalization rates (-16 basis points). Limited-service hotel experienced a notable decline in discount rates (-80 basis points), while overall capitalization rates increased slightly (+5 basis points) compared to one year ago.

The Silver Lining As a result of the COVID-19 virus, markets are exceptionally volatile. The hospitality sector has been among the most severely disrupted; businesses have suspended non-essential travel and implement working remote policies, major sporting, social and business events across the country have been postponed or cancelled, and vacation plans and transient corporate and leisure travel have come to a virtual halt in many locations. The practice of social distancing and shelter in place measures, either government mandated or self-enforced, have become the new societal norm and are expected to continue for the coming weeks and months. While it is unclear the magnitude or duration at this point, it is clear that the impact will be severe and will span across all geographies and chain scales to varying degrees. Still, there is cause for optimism in the midst of otherwise bleak conditions. Specifically, we note the following:

Our forecasts suggest that while the impact will be severe, it is expected to be short lived. In our most likely forecast scenario, the hotel sector is expected to rebound sharply beginning in the second half of the year.

• Brands have begun to offer owners temporary relief in a variety of forms, including deferred cycle & PIP renovations for up to a year, waiving FF&E Reserves for up to six months, and temporarily suspending brand standard audit activities. For now, relief from payment of Franchise Fees has not been offered en masse but is being vigorously pursued by owners.

• In light of what is highly likely to be a wave of technical and monetary defaults in hotel loans, lenders are being encouraged not to act on what contractual obligations may allow, but instead work with borrowers to develop a contingency plan until the market

Market Analysis

recovers. The FDIC released a memo encouraging lenders to consider a variety of forbearance measures, including deferred or reduced mortgage and/or interest payments, modification of existing loan terms and waiving certain fees such as late payment fees.

• The U.S. Small Business Association, which is a primary source of financing for many owner/operated limited and select service hotels across the country, launched the SBA Economic Injury Disaster Loan (EIDL) program in light of the COVID-19 pandemic, which will provide eligible participants up to $2 million in loan assistance. These loans may be used to pay fixed debts, payroll, accounts payable and other bills that can’t be paid because of the disaster’s impact. The interest rate is 3.75% for small businesses without credit available elsewhere; businesses with credit available elsewhere are not eligible.

• The CARES Act, a $2T disaster relief bill, was recently passed by Federal lawmakers, representing the largest financial stimulus package in US History. With the recent passage of the Act, the Small Business Administration has been authorized to extend additional financial relief to qualified small businesses and nonprofits. These loans and grants are designed to provide working capital during the COVID-19 emergency and to support job retention and economic recovery. American Hotel & Lodging Association (AHLA) led the lobbying effort on behalf of the hotel industry, and while it was acknowledged that this act is a step in the right direction, more will need to be done. They are currently working to increase the loan limits currently available to owners at 250% of monthly payroll claims to 400%, which would allow owners to cover both payroll and debt service. As part of the CARES Act, the SBA is providing financial assistance through two main programs: Economic Injury Disaster Loans and the Paycheck Protection Program (PPP).

o Economic Injury Disaster Loan (EIDL) program: This program provides small businesses with working capital loans of up to $2 million at an interest rate of 3.75%. Businesses may also apply for a loan advance of up to $10,000. Funds will be made available within three days of a successful application and, regardless of final loan approval, the loan advance will not have to be repaid. The loan may be used for paid sick leave to employees, maintaining payroll, meeting increased production costs due to supply chain disruptions, or paying business obligations, including debts, rent and mortgage payments.

o Payroll Protection Program: The Paycheck Protection Program within the CARES Act prioritizes millions of Americans employed by small businesses by authorizing up to $349 billion toward job retention and certain other expenses. As of April 3, 2020, eligible small businesses (generally those with 500 or fewer employees) and private nonprofits may apply for a loan up to $10 million determined by eight weeks of prior average payroll plus an additional 25% of that amount. The interest

Market Analysis

rate for the program is 0.5% for a term of two years, with payments deferred for six months. There are no fees, and no collateral or personal guarantees are required. The loan will be fully forgiven if the funds are used for payroll costs, interest on mortgages, rent and utilities. Forgiveness is based on the employer maintaining or quickly rehiring employees and maintaining salary levels. Forgiveness will be reduced if full-time headcount declines, or if salaries and wages decrease.

Conclusion CBRE is forecasting drastic reductions in travel for 2020. At this time, the COVID-19 baseline scenario indicates it will take approximately 24 months for US hotel demand to recover, and roughly 36 months for RevPAR to recover. The steep reductions in 2020 are followed by strong increases during 2021 and 2022. However, the impact will be harsh in 2020 and CBRE cautions the forecast could be altered downwards even more in the coming weeks as developments continue to unfold. Lending and investment caution are advised.

Market Analysis

Hotel Horizons Hotel Horizons® is a series of econometrically derived reports prepared on a quarterly basis that analyzes the historical and expected performance of 59 major U.S. lodging markets, as well as our national summary report of the entire U.S. lodging industry. Hotel Horizons® reports contain five years of forecast data and five years of historical market performance information. A variety of economic, demographic, and other benchmarking statistics appear in the reports to provide the reader with a deeper understanding of local market conditions.

PKF Hospitality Research, A CBRE Company (PKF-HR), prepares hotel market forecasts based on accepted econometric procedures and sound judgment. The product name for the PKF-HR forecasts is Hotel Horizons®. The two-stage process for producing the forecasts firstly involves econometric estimation of future hotel market activity and financial performance based on historical relationships between economic and hotel market variables, and secondly, a judgmental review of modeled outputs by experienced hotel market analysts. The hotel industry expertise of PKF dates back to the 1930s. PKF-HR and others believe that errors in forecasting are minimized by relying on both data analytics and judgment.

Econometric forecasting represents one of the most sophisticated approaches to gaining insight into future economic activity. Unlike some forecasting methods used in business practice, the models that underlie econometric forecasts contain variables based in economic theory. The forecasts come from historical relationships, similar to statistical correlations, among hotel market measures and economic variables. The measures for the variables come from actual market transactions involving individuals and firms interacting in the economy.

Gaining insight into the futures of complicated economic environments requires the introduction of multi-level forecasting models. Several equations often need to be identified and estimated to model complex economic conditions such as the national economy. Multi-equation models have considerable appeal for economic forecasting because they explicitly recognize the interdependence of relationships commonly encountered in markets. Perhaps the best example of this type of model is one that involves both the demand side and the supply side of markets, in which prices of goods are set by the interaction of buyers and sellers. Thus, price appears as a variable in both the demand and supply equations.

A committee of hotel experts from PKF-HR and CBRE Hotels performs a thorough review of each model prediction. These assessments are made by locally-based hotel experts working in the various offices around the U.S. The quarterly forecasts for the current and forecast period years are subject to review. The committee modifies the model’s market prediction when there is compelling evidence that factors have come into play that the model could not possibly foresee. A Super Bowl-type event, as an extreme example, would cause the committee’s forecast to differ noticeably from the model's prediction—not only in the city in which the event will occur, but also competing cities within the region. In most instances, however, the committee either defers to the model prediction or makes modest adjustments.

Market Analysis

San Diego Hotel Horizons According to the Hotel Horizons® June – August 2020 report, the hotel outlook for all chain- affiliated properties in the San Diego lodging market is (which includes both the full- and limited- service segments) indicates a substantial 59.8% decrease in RevPAR for all hotels in 2020. The historical and forecasted statistics for all hotel properties in the San Diego for all hotels and upper priced hotels area are shown in the following table.

Historically, the San Diego market has indicated occupancy ranging from approximately 76% to 78%, with ADR generally indicating steady increases over the survey period from around $150 to $165. However, the subject market has been significantly negatively impacted by the onset of the COVID-19 pandemic, with total projected occupancy decreases from 76.7% to 44.7% in 2020, indicating a 41.7% decline on a market-wide basis.

In addition, ADR in the San Diego market is projected to indicate a total decline of 31.1% in 2020, from $166.55 to $114.80. This decline can partially be attributed to the relatively high closures of luxury and upper upscale properties in comparison to economy and midscale properties, due to their relatively high cost of operations and relatively high reliance upon corporate and group demand which has been more significantly impacted than the leisure market.

Based on the forecasts, a strong recovery is expected in 2021, with occupancy increasing 40.0%, followed by further recovery of 17.9% in 2022 before reaching pre-COVID occupancy levels of 76.8% in 2023 with a 4.2% increase.

ADR is forecasted for generally similar but lagging recovery patterns, with 11.3% growth in 2021 followed by 21.0% increases in 2022. ADR is projected to reach pre-COVID levels in 2023 with a further 8.6% increase to $167.87 before stabilizing.

Market Analysis

Overall, RevPAR is projected to decline by a total of 59.8% in 2020, before recovering at 55.8%, 42.7%, and 13.1% growth, respectively, over the following three year period. RevPAR is projected to reach pre-COVID levels in 2023, at $128.93.

We note that these projections are as of July 2020, and the effective date of appraisal is February 2020, prior to the onset of the COVID-19 pandemic. Therefore, we have considered ADR and occupancy projections as of the effective date of appraisal.

Regional Conclusions San Diego’s positive growth in 2014 and continuing through 2018 reflects continued growth in both occupancy and rate; however, we note that 2019 indicated a slight decrease in RevPAR associated with occupancy declines as new supply is absorbed, and 2020 has been significantly negatively impacted by the onset of the COVID-19 pandemic. Long term historical trends in economic and demographic data suggest that the future prospects for San Diego County continue to be favorable. San Diego has been defined by economic diversification, revitalization of aging communities, scarcity of land, and good weather. San Diego County continues to present a viable place to do business and is expected to continue to grow along with the rest of Southern California.

COMPETITIVE HOTEL MARKET ANALYSIS Summary of Competitive Properties The following table provides a summary of the subject’s competitive hotel set. The hotels included in the Smith Travel Research (STR) report were based on management’s choice of competitors to include in their monthly Smith Travel Report participation.

PRIMARY COMPETITIVE HOTELS 12 Months Ending December 31, 2019 Year Competitive Occupancy ADR RevPAR Property Built Rooms Occ. Penetration ADR Penetration RevPAR Penetration Residence Inn By Marriott - Hotel Circle 2003 192 85% 104% $174.69 118% $148.94 122% Sheraton Hotel San Diego Mission Valley 1984 260 80% - 85% 90% - 100% $140 - $145 90% - 100% $115 - $120 90% - 100% DoubleTree by Hilton Hotel San Diego Hotel Circle 1970 219 80% - 85% 90% - 100% $140 - $145 90% - 100% $115 - $120 90% - 100% Residence Inn San Diego Central 1989 144 80% - 85% 90% - 100% $140 - $145 90% - 100% $115 - $120 90% - 100% Extended Stay America San Diego Hotel Circle 1999 166 80% - 85% 90% - 100% $140 - $145 90% - 100% $115 - $120 90% - 100% Holiday Inn Express & Suites San Diego Mission Valley 2015 104 80% - 85% 90% - 100% $140 - $145 90% - 100% $115 - $120 90% - 100% Homewood Suites by Hilton San Diego Mission Valley Zoo 2016 118 80% - 85% 90% - 100% $140 - $145 90% - 100% $115 - $120 90% - 100% Overall Totals/Averages 1,203 82% $148.08 $121.97 Compiled by CBRE Data for the individual properties was not reported, due to confidentiality reasons. The primary competitive set, including the subject, has a total of 1,203 rooms. The year-end 2019 occupancy and ADR achieved by these properties was roughly 82% and $148.08, respectively.

Market Analysis

STAR Report The STR STAR (Smith Travel Accommodations Report) program is used by the hotel industry for management and benchmarking. Hotel owners and managers submit data to Smith Travel Research who then aggregates this information and provides reporting. The report benchmarks a hotel’s performance against its competitive aggregate and local market. The STAR program tracks and delivers monthly, weekly and daily data.

STR is generally considered the standard source of reliable data for most markets. While it is widely utilized, it is important to note some of its limitations. Specifically, hotels are occasionally dropped in and out of the sample, and not all hotels report data in a consistent and timely matter. As a result, the data set is sometimes skewed upwards or downwards depending on the particular market and the overall quality of the data is negatively impacted. For most markets, however, it is considered to provide an accurate overall picture of market performance, and therefore, has been used in this analysis.

The trends in room supply, occupancy, average daily rate, and room-night demand (defined as the number of occupied rooms) for the subject and its competitive set is illustrated as follows as obtained from the latest STAR report for the subject. The STAR reports separate the subject metric data from the competitive set. The first table is for the subject itself:

HISTORICAL PERFORMANCE SUBJECT PROPERTY ALONE Room Night Subject Room Night Percent Average Percent Percent Year Supply Occupancy Demand Change Daily Rate Change RevPAR Change 2016 70,272 89.0% 62,542 --- $171.26 --- $152.46 --- 2017 70,080 85.5% 59,923 -4.2% $174.89 2.1% $149.54 -1.9% 2018 70,080 85.7% 60,059 0.2% $171.55 -1.9% $146.95 -1.7% 2019 70,080 85.5% 59,918 -0.2% $174.69 1.8% $149.35 1.6% CAG * -0.1% -1.4% 0.7% -0.7% Dec TTM 2017 70,080 85.5% 59,923 --- $174.55 --- $149.26 --- Dec TTM 2018 70,080 85.7% 60,029 0.2% $171.31 -1.9% $146.74 -1.7% Dec TTM 2019 70,080 85.3% 59,749 -0.5% $174.69 2.0% $148.94 1.5% CAG * 0.0% -0.1% 0.0% -0.1% * Compound Annual Growth Source: STAR Report

Market Analysis

The following is for the competitive set excluding the subject:

HISTORICAL PERFORMANCE COMPETITIVE SET EXCLUDING SUBJECT Room Night Comp. Set Room Night Percent Average Percent Percent Year Supply Occupancy Demand Change Daily Rate Change RevPAR Change 2017 369,015 84.9% 313,255 --- $138.93 --- $117.94 --- 2018 369,015 86.2% 318,084 1.5% $143.25 3.1% $123.48 4.7% 2019 369,015 81.8% 301,906 -5.1% $142.82 -0.3% $116.84 -5.4% CAG * 0.0% -1.8% 1.4% -0.5% Dec TTM 2017 369,015 84.9% 313,255 --- $138.93 --- $117.94 --- Dec TTM 2018 369,015 86.2% 318,084 1.5% $143.25 3.1% $123.48 4.7% Dec TTM 2019 369,015 81.8% 301,906 -5.1% $142.82 -0.3% $116.84 -5.4% CAG * 0.0% -1.8% 1.4% -0.5% * Compound Annual Growth Source: STAR Report The following table aggregates the subject and competitive set for an overall market view:

HISTORICAL MARKET PERFORMANCE STAR COMPETITIVE PROPERTIES INCLUDING SUBJECT Room Night Market Room Night Percent Average Percent Percent Year Supply Occupancy Demand Change Daily Rate Change RevPAR Change 2017 439,095 85.0% 373,178 --- $144.71 --- $123.01 --- 2018 439,095 86.1% 378,143 1.3% $147.75 2.1% $127.21 3.4% 2019 439,095 82.4% 361,824 -4.3% $148.09 0.2% $122.23 -3.9% CAG * 0.0% -1.5% 1.2% -0.3% Dec TTM 2017 439,095 85.0% 373,178 --- $144.65 --- $122.97 --- Dec TTM 2018 439,095 86.1% 378,113 1.3% $147.71 2.1% $127.17 3.4% Dec TTM 2019 439,095 82.4% 361,655 -4.4% $148.08 0.3% $122.15 -4.0% CAG * 0.0% -1.6% 1.2% -0.3% * Compound Annual Growth Source: STAR Report

Proposed Hotels/Additions to Supply There is new hotel development occurring in the larger market. However, to our knowledge there are no hotels under construction or proposed for the subject immediate market area that would be directly competitive to the subject.

We note the Hampton Inn – SDSU property at 6650 Montezuma Road in Mission Valley. This 125 room hotel property is projected for construction completion in July 2021. This location is outside of the subject immediate market area and is not considered to be competitive to the subject.

In addition, the Legacy Resort Hotel & Spa was recently constructed to the east of the subject at 875 Hotel Circle South. As of the date of report, the hotel is closed but is scheduled to re-open on August 21, 2020. Due to its positioning and market segmentation, this property is not considered to be directly competitive to the subject.

While CBRE has made several attempts to determine the level of new hotel supply entering the marketplace, it is impossible to determine every hotel that will be developed in the future, when

Market Analysis they will be completed, or their potential impact to the subject. We have identified additional projects in the local area but have not specifically included these properties in our analysis due to the stage of development, financing issues, market positioning, location, and/or rate structure. The inherent risk of any future new hotel supply has been implicitly considered in the selection of a stabilized occupancy level for the subject property.

HOTEL DEMAND GENERATORS Demand for hotel rooms is categorized in three ways:

• Demonstrated Demand: the demand already captured at competitive hotels; • Induced Demand: the demand that does not presently seek accommodations in the competitive market, but could be persuaded to do so through marketing efforts, room rates, facilities, services and amenities. • Unsatisfied Demand: the demand that seeks accommodations in the market but is not satisfied due to one of a number of factors: sell-outs during peak season; lack of a particular type of accommodation; lack of meeting space; or high room rates. Demand Segmentation In most markets, overall demand varies based on the nature of travel. In most markets, the lodging demand is generated from three different segments: Corporate, Group/Meeting and Leisure travelers. In some markets, a fourth classification may be present, such as airline contract or government.

Total demand is illustrated in the following table. The subject demand is driven primarily by the corporate market.

DEMAND SEGMENTATION - COMPETITIVE MARKET AND SUBJECT Competitive Set Subject Property Segment 2019 Demand % 2019 Demand % Penetration Total 361,655 100% 59,749 100% 104% Compiled by CBRE Demand Growth Conclusions Based on historic trends for the various demand segments, the state of the local and national economies, and conversations with local hotel operators in the marketplace, the applicable demand segments are projected to exhibit the following growth trends.

ANNUAL DEMAND GROWTH RATES

Segment 2020 2021 2022 2023 2024 Total 0.0% 1.0% 1.5% 1.0% 1.0% Compiled by CBRE As of the effective date of appraisal in February 2020, the CBRE Hotels Horizons San Diego forecast indicates stable occupancy in 2020. Occupancy forecasts are prepared on a national level, which we have considered as the basis of our demand increase projections for 2021-2024.

Market Analysis

We note that the demand growth rates represent market sentiment as of the effective date of appraisal in February 2020, prior to the onset of the COVID-19 pandemic.

Latent Demand Latent demand represents potential room nights in the marketplace that could not be accommodated by the existing hotels, and comes in two forms: Induced demand and displaced demand. Induced demand represents additional accommodated room nights by the introduction of a new demand generator, such as the construction of a conference center, a major company moving into the area, or the introduction of a new hotel that has distinct advantages over the existing competitors. For this analysis, no induced demand has been indicated.

Displaced Demand CBRE has also considered displaced demand for this analysis. Displaced demand occurs when individuals are unable to rent a room because all of the hotels in the marketplace are filled to capacity. As a result, individuals must defer their trips or make accommodations in other markets. Because this demand was not accommodated historically, it is not illustrated in the estimate of the historic accommodated room night demand. Displaced demand is illustrated further in markets where there are distinct high and low seasons, or several periods of high and low occupancy throughout the year. No displaced demand is indicated.

PROJECTED OCCUPANCY – COMPETITIVE SET Based on market factors presented throughout this section, the forecast of overall demand growth for the subject’s market is illustrated as follows:

PROJECTED BASE DEMAND, ANNUAL GROWTH, AND MARKET-WIDE OCCUPANCY Competitive Set Year Ending 12/31/ 2019 2020 2021 2022 2023 2024 Total Annual Growth 0.0% 1.0% 1.5% 1.0% 1.0% Base Nightly Demand 991 991 1,001 1,016 1,026 1,036 Total Segment Demand 361,655 362,646 365,272 370,751 374,458 379,239 Total Market Demand 361,655 362,646 365,272 370,751 374,458 379,239 Growth over Prior Year 0.3% 0.7% 1.5% 1.0% 1.3% Market Statistics Existing Rooms Supply 1,203 1,203 1,203 1,203 1,203 1,203 Proposed Rooms Supply ------Total Available Room Nights 439,095 440,298 439,095 439,095 439,095 440,298 Growth over Prior Year 0.3% -0.3% 0.0% 0.0% 0.3% Potential Market-wide Occupancy 82.4% 82.4% 83.2% 84.4% 85.3% 86.1% Accommodated Market Occupancy 82.4% 82.4% 83.2% 84.4% 85.3% 86.1% Source: CBRE

Market Analysis

HISTORIC OPERATING PERFORMANCE The subject’s occupancy, ADR, and RevPAR history is illustrated as follows:

SUBJECT'S HISTORIC OPERATING PERFORMANCE % % % Period Occupancy Change ADR Change RevPAR Change Year Ended: 12/31/2015 93% -- $168.51 -- $156.76 -- Year Ended: 12/31/2016 89% -4.3% $171.26 1.6% $152.46 -2.7% Year Ended: 12/31/2017 86% -4.0% $174.89 2.1% $149.54 -1.9% Year Ended: 12/31/2018 86% 0.2% $171.55 -1.9% $146.95 -1.7% Year Ended: 12/31/2019 85% -0.2% $174.69 1.8% $149.35 1.6% TTM 12/31/2019 85% -- $174.69 -- $149.35 -- Source: CBRE/Property Management As noted, the subject has experienced generally stable occupancy over the survey period; however, we note that the occupancy in 2017 and 2018 was negatively impacted by the renovations occurring. In addition, we note that the property was closed for a portion of December 2019 for termite control, and annual occupancy would have been approximately 88% in 2019 if the property had been open for the full month of December.

The previous 12 months represent a slight decrease in occupancy and a 1.8% increase in ADR. Historically, the subject has maintained occupancy in the upper 80% to low 90% range, with ADR ranging from approximately $169 to $175.

FORECAST OF OCCUPANCY AND AVERAGE DAILY RATE The average daily rate and the overall occupancy of a lodging facility are the foundation for the property’s financial performance. While a property’s other revenue components (food and beverage, telephone, spa, other income, etc.) are crucial to the operation of the hotel, they are dependent on the overall number of occupied rooms. Furthermore, the occupancy and average daily rate of a hotel are highly correlated. In reality, one cannot make a projection of one without a projection of the other. Therefore, while we have made specific projections of occupancy, but have considered the subject’s positioned rate in our forecast.

In order to project the future occupancy levels of the subject, we have estimated the level of patronage that can be reasonably captured (penetration). The extent to which the subject can capture demand from each market segment was estimated by performing a fair share penetration analysis.

A hotel's fair share is defined as the number of available rooms divided by the total supply of available rooms in the competitive market, including the subject. Factors indicating the subject would possess competitive advantages suggest a market penetration in excess of 100 percent of fair share, while competitive weaknesses are reflected in penetration less than 100 percent.

Market Analysis

Penetration Penetration is the relationship between a market’s fair share and its actual share of the overall demand. For example, a 100-room hotel would equate to 10% of a 1,000 room competitive set. If this hotel were to capture 10% of the overall lodging demand, it would penetrate the market by 100 percent.

Market penetration, or penetration rate, is the ratio of captured demand to fair share of demand. Factors indicating competitive advantages are typically reflected in penetration rates above 100 percent, while, conversely, competitive disadvantages are reflected in penetration rates below 100 percent. Actual penetration of each market segment by the Subject may deviate from fair market share for the reasons such as the following:

• The competitive advantages or disadvantages of the hotel versus the competition taking into consideration such factors as age, location, room rate structure, chain affiliation, quality of management, marketing efforts, and image; • The characteristics, needs, and composition of each market segment; • The restrain on demand captured due to capacity constraints during certain periods of the week or times of the year; and • Management decisions concerning target markets. The current market penetration rates of the competitive hotels and the subject are illustrated as follows:

OCCUPANCY PENETRATION

2019 Estimated Penetration Average Room 2019 2019 Fair Property Count Occupancy Share Total Residence Inn By Marriott - Hotel Circle 192 85.3% 16.0% 104% Total/Avg 1,203 82.4% 100.0% 100% Compiled by CBRE As noted, the subject has been outperforming the market with regards to occupancy penetration, as the property captures the extended stay market segment which indicates longer stays and higher occupancy levels when compared to typical limited service hotels. Also, the subject is outperforming the competitive set based on ADR, which can primarily be attributed to the subject Marriott affiliation, positioning within the Upscale segment, recent renovations, relatively large room sizes, and relatively high percentage of 2 bedroom suites.

Market Analysis

Overall, the subject improvements represent a viable hotel. The projections of captured penetration rates for the subject by demand segment along with the resulting projections of occupied room-nights are illustrated as follows:

PROJECTED SUBJECT PENETRATION SCHEDULE Year Ending 12/31/ 2019 2020 2021 2022 2023 SUBJECT PROPERTY FAIR SHARE Market Room Supply 1,203 1,203 1203 1,203 1,203 Subject Avg. Room Count 192 192 192 192 192 Fair Share 16.0% 16.0% 16.0% 16.0% 16.0% ROOM NIGHTS CAPTURED BY SUBJECT Total Fair Share 16.0% 16.0% 16.0% 16.0% 16.0% Penetration Factor 103.5% 107.0% 107.0% 107.0% 107.0% Market Share 16.5% 17.1% 17.1% 17.1% 17.1% Demand 361,655 362,646 365,272 370,751 374,458 Market Share 16.5% 17.1% 17.1% 17.1% 17.1% Capture 59,749 61,930 62,379 63,314 63,947 Total Capture 59,749 61,930 62,379 63,314 63,947 Potential Subject Occupancy 85.3% 88.1% 89.0% 90.3% 91.2% Overall Potential Subject Penetration 103.5% 107.0% 107.0% 107.0% 107.0% Compiled by CBRE The overall accommodated room night demand is multiplied by the subject’s fair share and by the projected penetration ratio to derive the subject’s accommodated room night demand. Although the subject’s illustrated occupancy rates increase after the stabilized year, we have forecasted 88.0% as the stabilized occupancy figure, consistent with the historical subject data. We note that the past several years of subject historical occupancy was negatively impacted by renovations and closure of the hotel for a portion of December 2019.

The stabilized occupancy figure is intended to be an average figure over the projected holding period. The following depicts the derivation of the occupancy projections for the subject.

Market Analysis

SUBJECT PROPERTY ESTIMATED OCCUPANCY ADJUSTED TO PROJECTION DATES Competitive Set Year Ending 12/30/ 2019 2020 2021 2022 2023 Room Nights Captured 59,749 61,930 62,379 63,314 63,947 Available Room Nights 70,080 70,272 70,080 70,080 70,080 Potential Subject Occupancy 85.3% 88.1% 89.0% 90.3% 91.2% Overall Potential Subject Market Share 16.5% 17.1% 17.1% 17.1% 17.1% Overall Potential Subject Penetration 103.5% 107.0% 107.0% 107.0% 107.0% Adjustment to Projection Year Ending 2/24/ 2021 2022 2023 2024 2025 First Year % 84.9% 84.9% 84.9% 84.9% 84.9% Second Year % 15.1% 15.1% 15.1% 15.1% 15.1% Adjusted Room Nights Accommodated 62,023 62,520 63,410 64,044 64,813 Projection Period Fiscal Year Occupancy 88.3% 89.2% 90.5% 91.4% 92.2% Rounded Occupancy 88% 89% 90% 91% 92% Overall Market Share 17.0% 17.0% 17.0% 17.0% 17.0% Overall Penetration 106.7% 106.7% 106.4% 106.5% 106.8% Captured Room Nights (Based on Rounded Occ.) 61,839 62,371 63,072 63,773 64,650

Compiled by CBRE Average Daily Rate As noted previously, one of the most important considerations in deriving an opinion of value of a hotel is its forecast of a supportable average daily rate (ADR). The ADR of a hotel can be calculated by dividing the total rooms revenue by the total number of occupied rooms achieved during a specified period of time.

SUBJECT’S COMPETITIVE POSITIONING Although the forecast of average daily rate follows the discussion of future occupancy, these two figures are highly correlated, and one cannot make projections of occupancy without specific assumptions of ADR. This relationship is defined by RevPAR, or Revenue Per Available Room. RevPAR is the measure of a property’s ability to maximize rooms revenue. Theoretically, for example, if a lodging property’s ADR increases substantially (with no market influencing factors), its occupancy would decrease. Conversely, if a property’s ADR decreases, an increase in occupancy would be anticipated. In each instance, RevPAR would remain unchanged. The historic ADR and RevPAR for the subject and the competitive set is illustrated as follows:

SUBJECT AND COMPETITIVE ADR AND REVPAR 2019 2019 Property ADR RevPAR Subject (Residence Inn By Marriott - Hotel Circle) $174.69 $148.94 Competitive Set Average $148.08 $121.97 Source: CBRE As illustrated in the preceding chart, the subject is generally at the upper end of the range relative to the competitive properties with respect to rate. This is a function of the subject’s Marriott

Market Analysis affiliation, positioning within the Upscale segment, recent renovations, relatively large room sizes, and relatively high percentage of 2 bedroom suites.

The subject’s historic ADR including the trailing twelve months (TTM) and year-to-date 2020 is illustrated as follows:

SUBJECT'S HISTORIC ADR TRENDS Period ADR % Change Year Ended: 12/31/2015 $168.51 -- Year Ended: 12/31/2016 $171.26 1.6% Year Ended: 12/31/2017 $174.89 2.1% Year Ended: 12/31/2018 $171.55 -1.9% Year Ended: 12/31/2019 $174.69 1.8% Source: CBRE/Property Management The projections for ADR growth and the resulting rates used in the analysis are illustrated as follows:

SUBJECT'S ESTIMATED ADR 12 Months ADR Estimated Ending Growth ADR 12/31/2019 -- $174.69 2/24/2020 * 0.5% $175.48 2/24/2021 3.0% $180.74 2/24/2022 1.5% $183.45 2/24/2023 2.0% $187.12 2/24/2024 2.5% $191.80 2/24/2025 3.0% $197.56 * Inflationary adjustment of 0.5% from 12/31/19 through 2/24/20 (projection start date). Source: CBRE As of the effective date of appraisal in February 2020, the CBRE Hotels Horizons San Diego forecast indicates a projected increase in ADR of 2.0% for the Mission Valley submarket in 2020. Considering the recent subject renovations and ADR trends, we have projected 3.0% ADR increase in Year 1.

ADR forecasts are prepared on a national level, which we have considered as the basis of our ADR increase projections for 2021-2024. Stabilized ADR growth is projected at 3.0% growth on a long-term basis. We note that the ADR growth rates represent market sentiment as of the effective date of appraisal in February 2020, prior to the onset of the COVID-19 pandemic.

Market Analysis

CONCLUSION The subject’s occupancy, ADR, RevPAR, and corresponding room revenue for the first several years of our projection analysis are illustrated as follows:

OCCUPANCY, ADR, & ROOMS REVENUE CONCLUSIONS Fiscal Year Ending 2/24/ 2021 2022 2023 2024 Avg. Available Rooms 192 192 192 192 Annual Room Nights 70,272 70,080 70,080 70,080 Occupancy 88% 88% 88% 88% Occupied Rooms 61,839 61,670 61,670 61,670 ADR $180.74 $183.45 $187.12 $191.80 RevPAR $159.05 $161.44 $164.67 $168.78 Total Rooms Revenue $11,177,012 $11,313,671 $11,539,944 $11,828,443 Source: CBRE The effective date of value is February 25, 2020. As of the effective date of appraisal, the hotel market was not yet feeling the effects of the COVID-19 pandemic, which began to be felt in the United States market in March 2020. As of the date of report in August 2020, the nation, region, and market area are impacted by the COVID-19 pandemic, which could have a prolonged effect on macroeconomic conditions. Therefore, we note that the ADR and occupancy projections are based on investor and management sentiment prior to the onset of the COVID-19 pandemic.

Based on the foregoing analysis, the indicated occupancy and ADR figures are achievable, based on sentiment as of the effective date of appraisal. The estimated occupancy and ADR levels are representative of the most likely potential operations of the subject over the projected holding period based on our analysis of the market as of the date of this appraisal, based on information available as of the effective date of appraisal.

Highest and Best Use

In appraisal practice, the concept of highest and best use represents the premise upon which value is based. The four criteria the highest and best use must meet are:

• legally permissible; • physically possible; • financially feasible; and • maximally productive. The highest and best use analysis of the subject is discussed below.

AS VACANT Legally Permissible The legally permissible uses were discussed in the Site Analysis and Zoning Sections.

Physically Possible The subject is adequately served by utilities, and has an adequate shape and size, sufficient access, etc., to be a separately developable site. There are no known physical reasons why the subject site would not support any legally probable development (i.e. it appears adequate for development).

Existing structures on similar sites provides additional evidence for the physical possibility of development.

Financially Feasible Potential uses of the site include a variety of commercial uses, including hotels, retail, and office, among other uses. The determination of financial feasibility is dependent primarily on the relationship of supply and demand for the legally probable land uses versus the cost to create the uses. Overall, there is elevated risk in the commercial real estate market due to COVID-19; however, the market is anticipated to recover strongly over the long term due to the concentration of demand generators in the market, and we note that our effective date is February 25, 2020, prior to the onset of the pandemic.

Maximally Productive - Conclusion The final test of highest and best use of the site as if vacant is that the use be maximally productive, yielding the highest return to the land.

Based on the information presented above and upon information contained in the market and neighborhood analysis, we conclude that the highest and best use of the subject as if vacant would be holding the property for future development of a commercial property, as the market recovers from the COVID-19 pandemic. Our analysis of the subject and its respective market characteristics indicate the most likely buyer, as if vacant, would be an investor (land speculation) or a developer.

Highest and Best Use

AS IMPROVED Legally Permissible The site has been improved with a hotel development that appears to be a legally conforming use.

Physically Possible The layout and positioning of the improvements are considered functional for hotel use. While it would be physically possible for a wide variety of uses, based on the legal restrictions and the design of the improvements, the continued use of the property for hotel users would be the most functional use. The property is functional for hotel use, and recent occupancy levels at the subject are typically in the upper 80% to low 90% range, indicating strong demand. Also, the subject benefits from relatively large room sizes and a relatively high percentage of 2 bedroom suites.

Financially Feasible The financial feasibility of a hotel property is based on the amount of revenues which can be generated, less operating expenses required to generate that income; if a residual amount exists, then the land is being put to a productive use. Based upon the income capitalization approach conclusion, the subject is producing a positive net cash flow and continued utilization of the improvements for hotel purposes is considered financially feasible. Further, the value of the improvements detailed clearly exceeds the underlying land value. Overall, hotel use is considered to be financially feasible on a long term basis.

Maximally Productive - Conclusion As shown in the applicable valuation sections, buildings that are similar to the subject have been acquired or continue to be used by hotel owners and operators. None of the comparable buildings selected for direct comparison have been acquired for conversion to an alternative use.

Based on the foregoing, the highest and best use of the property, as improved, is consistent with the existing use as a hotel development.

Appraisal Methodology

In appraisal practice, an approach to value is included or omitted based on its applicability to the property type being valued and the quality and quantity of information available.

INCOME CAPITALIZATION APPROACH The income capitalization approach reflects the subject’s income-producing capabilities. This approach is based on the assumption that value is created by the expectation of benefits to be derived in the future. Specifically estimated is the amount an investor would be willing to pay to receive an income stream plus reversion value from a property over a period of time. The two common valuation techniques associated with the income capitalization approach are direct capitalization and the discounted cash flow (DCF) analysis.

SALES COMPARISON APPROACH The sales comparison approach utilizes sales of comparable properties, adjusted for differences, to indicate a value for the subject. Valuation is typically accomplished using physical units of comparison such as price per square foot, price per unit, price per floor, etc., or economic units of comparison such as gross rent multiplier. Adjustments are applied to the physical units of comparison derived from the comparable sale. The unit of comparison chosen for the subject is then used to yield a total value. Economic units of comparison are not adjusted, but rather analyzed as to relevant differences, with the final estimate derived based on the general comparisons.

COST APPROACH The cost approach is based on the proposition that the informed purchaser would pay no more for the subject than the cost to produce a substitute property with equivalent utility. This approach is particularly applicable when the property being appraised involves relatively new improvements that represent the highest and best use of the land, or when it is improved with relatively unique or specialized improvements for which there exist few sales or leases of comparable properties.

METHODOLOGY APPLICABLE TO THE SUBJECT In valuing the subject, only the sales comparison and income capitalization approaches are applicable. Given the nature of the subject's age, level of depreciation, the cost approach would not produce a meaningful value indicator. For these reasons, coupled with the fact that prospective buyers of hotels generally do not base or place weight on the cost approach as a basis for determining market value, there is limited application of this approach. However, we have included an insurable value/replacement cost estimate. The elimination of the cost approach does not diminish the analysis or value conclusion. The exclusion of the cost approach is not considered to compromise the credibility of the results rendered herein.

Income Capitalization Approach

The Income Capitalization Approach to value is based upon the premise that an investor would not pay more for a property than for another investment with similar risk and return characteristics. This approach analyzes a property's ability to generate financial returns as an investment, and converts the anticipated future benefits of property ownership into an estimate of present value. For income producing properties like hotels, future benefits include net income before debt service and depreciation and any reversionary proceeds from a sale. The income capitalization approach is the preferred value method for existing hotels and most closely reflects the underwriting practices of informed buyers. It is also particularly relevant for hotels, which are typically purchased for investment purposes and involve relatively high risks. For this analysis, we have utilized both the direct capitalization analysis and the discounted cash flow analysis.

INCOME AND EXPENSE HISTORY Historical income and expense data was made available and is summarized in the tables that follow. For purposes of our analysis, we assume the information provided is accurate.

Where applicable, we have reclassified the available information to conform to the Uniform System of Accounts for the Lodging Industry, an industry-standard accounting format. The Uniform System of Accounts for the Lodging Industry was developed by the American Hotel & Motel Association and is in general use throughout the hospitality industry. In conformance with this system of account classifications, only direct operating expenses are charged to operating departments of the hotel. The general overhead items which are applicable to operations as a whole are classified as undistributed operating expenses and include administration and general expenses, marketing expenses, property operations and maintenance expenses, energy and utility costs, management fees, property taxes, insurance, and a reserve for replacement. The subject operating statements have been reconstructed to conform to the Uniform System of Accounts for the Lodging Industry. Additional line items contained in the Profit & Loss statements such as interest expense and depreciation have been excluded from our analysis.

The following are summaries of the available subject operating historical operating results.

Income Capitalization Approach

SUBJECT OPERATING HISTORY Period Reported: Complete Calendar Year Ended: Complete Calendar Year Ended: Full Year Budget Ending: 12/31/2018 12/31/2019 12/31/2020 Days Open 365 365 366 No. of Rooms 192 192 192 Occupied Room Nights 60,029 59,913 61,589 Occupancy 85.7% 85.5% 87.6% Average Daily Rate $171.55 $174.69 $180.09 RevPAR $146.95 $149.35 $157.84

Total Ratio to Sales PAR POR Total Ratio to Sales PAR POR Total Ratio to Sales PAR POR REVENUE Rooms $10,297,953 94.0% $53,635 $171.55 $10,466,123 92.4% $54,511 $174.69 $11,091,671 89.2% $57,769 $180.09 Food & Beverage - 0.0% $0 $0.00 - 0.0% $0 $0.00 501,491 4.0% $2,612 $8.14 Other Operated Departments 130,274 1.2% $679 $2.17 141,778 1.3% $738 $2.37 137,686 1.1% $717 $2.24 Miscellaneous Income 531,892 4.9% $2,770 $8.86 724,451 6.4% $3,773 $12.09 701,923 5.6% $3,656 $11.40 Total Operating Revenue $10,960,119 100.0% $57,084 $182.58 $11,332,352 100.0% $59,023 $189.15 $12,432,771 100.0% $64,754 $201.87

DEPARTMENTAL EXPENSES Rooms Expense $2,217,079 21.5% $11,547 $36.93 $2,341,334 22.4% $12,194 $39.08 $2,452,670 22.1% $12,774 $39.82 Food & Beverage Expense - $0 $0.00 - $0 $0.00 382,832 76.3% $1,994 $6.22 Other Operated Departments Expense 53,230 40.9% $277 $0.89 39,639 28.0% $206 $0.66 53,527 38.9% $279 $0.87 Total Departmental Expenses $2,270,309 20.7% $11,825 $37.82 $2,380,973 21.0% $12,401 $39.74 $2,889,029 23.2% $15,047 $46.91 DEPARTMENTAL PROFIT $8,689,810 79.3% $45,259 $144.76 $8,951,379 79.0% $46,622 $149.41 $9,543,741 76.8% $49,707 $154.96

UNDISTRIBUTED OPERATING EXPENSES Administrative and General $815,924 7.4% $4,250 $13.59 $916,097 8.1% $4,771 $15.29 $944,110 7.6% $4,917 $15.33 Information and Telecommunications Systems 63,693 0.6% $332 $1.06 42,279 0.4% $220 $0.71 43,740 0.4% $228 $0.71 Marketing 1,105,461 10.1% $5,758 $18.42 1,079,931 9.5% $5,625 $18.02 1,153,771 9.3% $6,009 $18.73 Property Operations and Maintenance 449,633 4.1% $2,342 $7.49 492,667 4.3% $2,566 $8.22 472,949 3.8% $2,463 $7.68 Utilities 476,257 4.3% $2,481 $7.93 464,986 4.1% $2,422 $7.76 465,552 3.7% $2,425 $7.56 Total Undistributed Expenses $2,910,968 26.6% $15,161 $48.49 $2,995,960 26.4% $15,604 $50.01 $3,080,122 24.8% $16,042 $50.01 GROSS OPERATING PROFIT $5,778,842 52.7% $30,098 $96.27 $5,955,419 52.6% $31,018 $99.40 $6,463,619 52.0% $33,665 $104.95

Management Fee $328,804 3.0% $1,713 $5.48 $339,971 3.0% $1,771 $5.67 $357,938 2.9% $1,864 $5.81 INCOME BEFORE NON-OPERATING INCOME AND EXPENSES $5,450,038 49.7% $28,386 $90.79 $5,615,448 49.6% $29,247 $93.73 $6,105,681 49.1% $31,800 $99.14

NON-OPERATING INCOME AND EXPENSES Property Taxes $740,687 6.8% $3,858 $12.34 $769,429 6.8% $4,007 $12.84 $796,000 6.4% $4,146 $12.92 Insurance 101,335 0.9% $528 $1.69 64,143 0.6% $334 $1.07 78,101 0.6% $407 $1.27 Reserve for Replacement 438,405 4.0% $2,283 $7.30 453,294 4.0% $2,361 $7.57 497,311 4.0% $2,590 $8.07 Total Non-Operating Income and Expenses $1,280,427 11.7% $6,669 $21.33 $1,286,866 11.4% $6,702 $21.48 $1,371,412 11.0% $7,143 $22.27

NET INCOME (EBITDA) $4,169,611 38.0% $21,717 $69.46 $4,328,582 38.2% $22,545 $72.25 $4,734,270 38.1% $24,658 $76.87

* Departmental expense ratios are based on departmental revenues; Franchise/Royalty ratio is based on room revenues; all others are based on total revenues.

Source: Hotel Operating Statements, Internal Trends Database *As noted, the Food & Beverage component was constructed in early 2020, and these revenues are included in the 2020 budget but are excluded from historical operating statements. The 2020 budget was prepared prior to the onset of the COVID-19 pandemic and reflects management sentiment as of year-end 2019.

Income Capitalization Approach

SUBJECT OPERATING HISTORY Period Reported: Complete Calendar Year Ended: Complete Calendar Year Ended: Complete Calendar Year Ended: 12/31/2015 12/31/2016 12/31/2017 Days Open 365 366 365 No. of Rooms 192 192 192 Occupied Room Nights 65,196 62,561 59,923 Occupancy 93.0% 89.0% 85.5% Average Daily Rate $168.51 $171.26 $174.89 RevPAR $156.76 $152.46 $149.54

Total Ratio to Sales PAR POR Total Ratio to Sales PAR POR Total Ratio to Sales PAR POR REVENUE Rooms $10,985,899 94.9% $57,218 $168.51 $10,714,004 95.2% $55,802 $171.26 $10,479,870 95.0% $54,583 $174.89 Food & Beverage - 0.0% $0 $0.00 - 0.0% $0 $0.00 - 0.0% $0 $0.00 Other Operated Departments 142,992 1.2% $745 $2.19 123,992 1.1% $646 $1.98 45,218 0.4% $236 $0.75 Miscellaneous Income 441,581 3.8% $2,300 $6.77 414,222 3.7% $2,157 $6.62 507,901 4.6% $2,645 $8.48 Total Operating Revenue $11,570,472 100.0% $60,263 $177.47 $11,252,218 100.0% $58,605 $179.86 $11,032,989 100.0% $57,463 $184.12

DEPARTMENTAL EXPENSES* Rooms Expense $1,913,798 17.4% $9,968 $29.35 $1,990,705 18.6% $10,368 $31.82 $2,112,974 20.2% $11,005 $35.26 Food & Beverage Expense - $0 $0.00 - $0 $0.00 - $0 $0.00 Other Operated Departments Expense 75,017 52.5% $391 $1.15 51,754 41.7% $270 $0.83 56,336 124.6% $293 $0.94 Total Departmental Expenses $1,988,815 17.2% $10,358 $30.51 $2,042,459 18.2% $10,638 $32.65 $2,169,310 19.7% $11,298 $36.20

DEPARTMENTAL PROFIT $9,581,657 82.8% $49,904 $146.97 $9,209,759 81.8% $47,967 $147.21 $8,863,679 80.3% $46,165 $147.92

UNDISTRIBUTED OPERATING EXPENSES Administrative and General $761,882 6.6% $3,968 $11.69 $770,972 6.9% $4,015 $12.32 $874,606 7.9% $4,555 $14.60 Information and Telecommunications Systems 39,281 0.3% $205 $0.60 66,763 0.6% $348 $1.07 66,324 0.6% $345 $1.11 Marketing 1,269,694 11.0% $6,613 $19.48 1,185,356 10.5% $6,174 $18.95 1,153,908 10.5% $6,010 $19.26 Property Operations and Maintenance 386,616 3.3% $2,014 $5.93 439,375 3.9% $2,288 $7.02 445,855 4.0% $2,322 $7.44 Utilities 455,619 3.9% $2,373 $6.99 423,702 3.8% $2,207 $6.77 433,405 3.9% $2,257 $7.23 Total Undistributed Expenses $2,913,092 25.2% $15,172 $44.68 $2,886,168 25.6% $15,032 $46.13 $2,974,098 27.0% $15,490 $49.63

GROSS OPERATING PROFIT $6,668,565 57.6% $34,732 $102.28 $6,323,591 56.2% $32,935 $101.08 $5,889,581 53.4% $30,675 $98.29

Management Fee $289,262 2.5% $1,507 $4.44 $306,700 2.7% $1,597 $4.90 $330,875 3.0% $1,723 $5.52 INCOME BEFORE NON-OPERATING INCOME AND EXPENSES $6,379,303 55.1% $33,226 $97.85 $6,016,891 53.5% $31,338 $96.18 $5,558,706 50.4% $28,952 $92.76

NON-OPERATING INCOME AND EXPENSES Property Taxes 740,402 6.4% $3,856 $11.36 705,072 6.3% $3,672 $11.27 714,217 6.5% $3,720 $11.92 Insurance 101,634 0.9% $529 $1.56 105,501 0.9% $549 $1.69 98,513 0.9% $513 $1.64 Reserve for Replacement 462,819 4.0% $2,411 $7.10 450,089 4.0% $2,344 $7.19 441,320 4.0% $2,299 $7.36 Total Non-Operating Income and Expenses $1,304,855 11.3% $6,796 $20.01 $1,260,662 11.2% $6,566 $20.15 $1,254,050 11.4% $6,532 $20.93

NET INCOME (EBITDA) $5,074,448 43.9% $26,429 $77.83 $4,756,229 42.3% $24,772 $76.03 $4,304,656 39.0% $22,420 $71.84

* Departmental expense ratios are based on departmental revenues; Franchise/Royalty ratio is based on room revenues; all others are based on total revenues.

Source: Hotel Operating Statements, Internal Trends Database

Income Capitalization Approach

INCOME AND EXPENSE COMPARABLES This analysis incorporates revenue estimates based on our survey of comparable and competitive properties, and general market trend information. The revenue and expense comparisons include 2019 profit & loss statements for four Residence Inn hotel properties, all located in San Diego County.

The comparable hotels’ financial information is obtained in part from confidential information submitted for the 2019 edition (2018 year-end data) of the CBRE Hotels’ Americas Research publication Trends® in the Hotel Industry (U.S. edition). For reasons of confidentiality, we have not disclosed the identity of the comparable hotels. The following charts summarize income and expenses taken from regional revenue/expense comparables as well as data from the STR Host Report and the Trends® in the Hotel Industry (U.S. edition) report.

Income Capitalization Approach

COMPARABLE INCOME AND EXPENSE DATA - SELECTED HOTELS

Property Comparable 1 Comparable 2 Comparable 3 Comparable 4 Location San Diego County, CA San Diego County, CA San Diego County, CA San Diego County, CA Hotel Description / Name Residence Inn Residence Inn Residence Inn Residence Inn Year 2019 2019 2019 2019 Days Open 365 365 365 365 Avg. No. of Rooms 148 118 112 125 Occupancy 93.7% 84.3% 75.8% 81.0% Average Daily Rate $185.23 $168.79 $147.89 $162.70

Ratio to Sales PAR POR Ratio to Sales PAR POR Ratio to Sales PAR POR Ratio to Sales PAR POR REVENUE Rooms 98.4% $63,358 $185.26 93.4% $51,951 $168.84 97.8% $40,893 $147.81 98.2% $48,122 $162.77 Other Operated Departments 1.3% $816 $2.39 6.6% $3,671 $11.93 1.5% $634 $2.29 1.7% $823 $2.78 Miscellaneous Income 0.4% $234 $0.69 0.0% $20 $0.07 0.7% $302 $1.09 0.1% $42 $0.14 Total Operating Revenue 100.0% $64,409 $188.33 100.0% $55,642 $180.84 100.0% $41,830 $151.19 100.0% $48,987 $165.69

DEPARTMENTAL EXPENSES* Rooms Expense 18.3% $11,578 $33.85 20.9% $10,846 $35.25 21.2% $8,675 $31.35 20.4% $9,816 $33.20 Other Operated Departments Expense 39.8% $324 $0.95 8.9% $326 $1.06 40.6% $257 $0.93 23.0% $189 $0.64 Total Departmental Expenses 18.5% $11,903 $34.80 20.1% $11,172 $36.31 21.4% $8,932 $32.28 20.4% $10,005 $33.84

DEPARTMENTAL PROFIT 81.5% $52,506 $153.52 79.9% $44,471 $144.53 78.6% $32,898 $118.91 79.6% $38,982 $131.85

UNDISTRIBUTED OPERATING EXPENSES Administrative and General 7.4% $4,786 $13.99 7.0% $3,885 $12.63 7.6% $3,197 $11.55 7.1% $3,486 $11.79 Information and Telecommunications Systems 0.8% $483 $1.41 0.6% $359 $1.17 1.3% $564 $2.04 0.6% $279 $0.94 Marketing 11.9% $7,691 $22.49 6.3% $3,501 $11.38 12.2% $5,086 $18.38 7.0% $3,428 $11.59 Property Operations and Maintenance 3.6% $2,288 $6.69 3.3% $1,859 $6.04 3.0% $1,235 $4.47 3.8% $1,877 $6.35 Utilities 2.9% $1,851 $5.41 3.2% $1,762 $5.73 4.6% $1,918 $6.93 3.9% $1,934 $6.54 Total Undistributed Expenses 26.5% $17,100 $50.00 20.4% $11,366 $36.94 28.7% $12,000 $43.37 22.5% $11,003 $37.22

GROSS OPERATING PROFIT 55.0% $35,406 $103.52 59.5% $33,105 $107.59 50.0% $20,898 $75.53 57.1% $27,980 $94.64

Management Fee 3.6% $2,338 $6.83 7.2% $3,987 $12.96 2.8% $1,152 $4.16 7.0% $3,429 $11.60 INCOME BEFORE NON-OPERATING INCOME AND EXPENSES 51.3% $33,068 $96.69 52.3% $29,118 $94.63 47.2% $19,746 $71.37 50.1% $24,551 $83.04

NON-OPERATING INCOME AND EXPENSES Property Taxes 3.1% $2,007 $5.87 3.6% $1,996 $6.49 5.5% $2,293 $8.29 6.1% $2,965 $10.03 Insurance 0.6% $392 $1.14 0.9% $480 $1.56 2.8% $1,151 $4.16 1.1% $552 $1.87 Reserve for Replacement 0.0% $0 $0.00 0.0% $0 $0.00 0.0% $0 $0.00 0.0% $0 $0.00 Total Non-Operating Income and Expenses 3.7% $2,399 $7.01 4.4% $2,476 $8.05 8.2% $3,444 $12.45 7.2% $3,518 $11.90 $0 $0.00 $0 $0.00 $0 $0.00 $0 $0.00 NET INCOME (EBITDA) 47.6% $30,670 $89.68 47.9% $26,642 $86.58 39.0% $16,302 $58.92 42.9% $21,033 $71.14

* Departmental expense ratios are based on departmental revenues; Franchise/Royalty ratio is based on room revenues; all others are based on total revenues.

Source: Hotel Operating Statements

Income Capitalization Approach

COMPARABLE HOTEL OPERATING STATISTICS - SELECTED CATEGORIES - 2019 HOST REPORT

Property HOST Report - Weighted Average Limited Service Pacific Limited Service Chain-Affiliated Limited Service Suburban Limited Service Upscale Class Limited Service Total U.S. Year 2018 2018 2018 2018 2018 2018 Avg. No. of Rooms 122 130 119 114 129 119 Occupancy 77.1% 81.5% 75.0% 74.2% 78.9% 75.0% Average Daily Rate $122.99 $136.38 $113.40 $98.94 $146.90 $114.99

Ratio to Sales PAR POR Ratio to Sales PAR POR Ratio to Sales PAR POR Ratio to Sales PAR POR Ratio to Sales PAR POR Ratio to Sales PAR POR REVENUE Rooms 96.8% $34,760 $122.99 96.4% $40,558 $136.38 96.9% $31,058 $113.40 97.8% $26,798 $98.94 96.2% $42,360 $146.90 96.7% $31,486 $114.99 Other Operated Departments 2.1% $784 $2.77 2.1% $883 $2.97 2.1% $674 $2.46 1.6% $436 $1.61 2.6% $1,162 $4.03 2.2% $710 $2.59 Miscellaneous Income 1.1% $402 $1.41 1.5% $635 $2.14 1.0% $317 $1.16 0.6% $169 $0.62 1.1% $490 $1.70 1.1% $360 $1.32

Total Operating Revenue 100.0% $35,946 $127.17 100.0% $42,075 $141.48 100.0% $32,049 $117.01 100.0% $27,403 $101.17 100.0% $44,012 $152.63 100.0% $32,556 $118.90

DEPARTMENTAL EXPENSES Rooms Expense 22.5% $7,805 $27.64 21.2% $8,583 $28.86 22.8% $7,089 $25.88 21.7% $5,822 $21.50 23.2% $9,830 $34.09 23.8% $7,367 $26.91 Food & Beverage Expense 0.0% $0 $0.00 0.0% $0 $0.00 0.0% $0 $0.00 0.0% $0 $0.00 0.0% $0 $0.00 0.0% $0 $0.00 Other Operated Departments Expense 63.2% $496 $1.75 58.7% $518 $1.74 64.8% $437 $1.59 62.7% $274 $1.01 65.1% $756 $2.62 64.8% $460 $1.68

Total Departmental Expenses 23.1% $8,301 $29.39 21.6% $9,101 $30.60 23.5% $7,526 $27.48 22.2% $6,096 $22.51 24.1% $10,586 $36.71 24.0% $7,827 $28.59

DEPARTMENTAL PROFIT 76.9% $27,645 $97.79 78.4% $32,974 $110.88 76.5% $24,524 $89.54 77.8% $21,307 $78.67 75.9% $33,426 $115.92 76.0% $24,729 $90.31

UNDISTRIBUTED OPERATING EXPENSES Administrative and General 8.4% $2,995 $10.62 7.7% $3,251 $10.93 8.7% $2,783 $10.16 9.0% $2,454 $9.06 8.1% $3,546 $12.30 8.7% $2,846 $10.39 Information and Telecommunications Systems 1.1% $400 $1.42 0.9% $393 $1.32 1.2% $379 $1.38 1.3% $358 $1.32 1.1% $476 $1.65 1.2% $386 $1.41 Marketing 4.8% $1,737 $6.15 4.5% $1,914 $6.43 4.9% $1,563 $5.71 4.8% $1,323 $4.88 5.0% $2,220 $7.70 4.9% $1,592 $5.81 Franchise Fees 4.5% $1,602 $5.69 3.3% $1,386 $4.66 4.8% $1,552 $5.67 4.7% $1,290 $4.76 5.1% $2,228 $7.73 4.6% $1,507 $5.50 Property Operations and Maintenance 4.5% $1,578 $5.60 3.9% $1,623 $5.46 4.6% $1,484 $5.42 5.0% $1,368 $5.05 4.2% $1,852 $6.42 4.7% $1,524 $5.56 Utilities 3.8% $1,327 $4.71 3.2% $1,356 $4.56 3.9% $1,254 $4.58 4.3% $1,184 $4.37 3.5% $1,541 $5.34 3.9% $1,275 $4.66 Total Undistributed Expenses 27.1% $1,602 $5.69 23.6% $1,386 $4.66 28.1% $1,552 $5.67 29.1% $1,290 $4.76 27.0% $2,228 $7.73 28.0% $1,507 $5.50

GROSS OPERATING PROFIT 45.3% $16,404 $57.91 51.5% $21,666 $72.86 43.5% $13,956 $50.96 43.9% $12,041 $44.46 43.9% $19,335 $67.05 43.3% $14,094 $51.47

Management Fee 3.3% $1,207 $4.26 3.3% $1,381 $4.64 3.1% $1,002 $3.66 3.0% $813 $3.00 4.0% $1,756 $6.09 3.1% $1,004 $3.67 INCOME BEFORE NON-OPERATING INCOME AND EXPENSES 46.5% $16,799 $59.34 51.5% $21,671 $72.87 45.3% $14,506 $52.96 45.7% $12,518 $46.22 45.0% $19,806 $68.69 44.8% $14,596 $53.31

NON-OPERATING INCOME AND EXPENSES Property Taxes 4.3% $1,546 $5.48 3.5% $1,460 $4.91 4.7% $1,491 $5.44 4.2% $1,146 $4.23 4.6% $2,037 $7.06 4.7% $1,542 $5.63 Insurance 0.9% $336 $1.19 1.0% $408 $1.37 1.0% $308 $1.12 1.0% $274 $1.01 0.8% $359 $1.24 1.0% $320 $1.17 Reserve for Replacement 1.6% $595 $2.10 1.5% $644 $2.17 1.4% $464 $1.69 1.4% $383 $1.41 2.2% $974 $3.38 1.4% $463 $1.69 Total Non-Operating Income and Expenses 5.3% $1,882 $6.67 4.4% $1,868 $6.28 5.6% $1,798 $6.57 5.2% $1,420 $5.24 5.4% $2,396 $8.31 5.7% $1,862 $6.80 NET INCOME (EBITDA) 41.3% $14,917 $52.66 47.1% $19,803 $66.59 39.6% $12,708 $46.40 40.5% $11,098 $40.97 39.6% $17,410 $60.38 39.1% $12,734 $46.51

Source: The 2019 HOST Report, for the year 2018, Smith Travel Research

Income Capitalization Approach

TRENDS® - SELECTED CATEGORIES

Suite Hotels With Food and Beverage - Suite Hotels With Food and Beverage - Over Suite Hotels With Food and Beverage - Property Trends® Report - Weighted Average Mountain and Pacific $170.00 Under 200 Rooms Suite Hotels With Food and Beverage Year 2018 2018 2018 2018 2018 Avg. No. of Rooms 218 239 257 151 226 Occupancy 79.9% 80.4 % 82.3 % 77.2 % 78.3 % Average Daily Rate $176.65 $174.47 $200.02 $153.92 $167.57

Ratio to Sales PAR POR Ratio to Sales PAR POR Ratio to Sales PAR POR Ratio to Sales PAR POR Ratio to Sales PAR POR REVENUE Rooms 82.6% $51,598 $176.65 81.3% $51,206 $174.47 81.8% $60,063 $200.02 85.4% $43,399 $153.92 82.9% $47,863 $167.57 Food and Beverage 12.8% $8,039 $27.48 14.4% $9,037 $30.79 12.7% $9,356 $31.16 10.1% $5,134 $18.21 12.9% $7,425 $26.00 Other Operated Departments 3.6% $2,294 $7.83 3.5% $2,234 $7.61 4.3% $3,145 $10.47 3.1% $1,566 $5.56 3.2% $1,875 $6.56 Miscellaneous Income 1.0% $652 $2.23 0.8% $494 $1.68 1.1% $820 $2.73 1.4% $708 $2.51 1.0% $589 $2.06

Total Operating Revenue 100.0% $62,581 $214.19 100.0% $62,970 $214.55 100.0% $73,383 $244.38 100.0% $50,808 $180.19 100.0% $57,752 $202.19

DEPARTMENTAL EXPENSES Rooms Expense 23.9% $12,326 $42.22 23.8% $12,186 $41.52 23.4% $14,077 $46.88 24.1% $10,454 $37.08 24.5% $11,733 $41.08 Food and Beverage Expense 75.8% $6,052 $20.70 74.5% $6,735 $22.95 73.8% $6,905 $23.00 81.6% $4,190 $14.86 75.5% $5,603 $19.62 Other Operated Departments Expense 42.5% $962 $3.29 35.6% $795 $2.71 42.2% $1,327 $4.42 53.9% $844 $2.99 42.7% $801 $2.80

Total Departmental Expenses 30.9% $19,339 $66.20 31.3% $19,715 $67.17 30.4% $22,309 $74.29 30.5% $15,489 $54.93 31.4% $18,137 $63.50

DEPARTMENTAL PROFIT 69.1% $43,242 $147.99 68.7% $43,256 $147.38 69.6% $51,074 $170.08 69.5% $35,319 $125.26 68.6% $39,614 $138.69

UNDISTRIBUTED OPERATING EXPENSES Administrative and General 7.2% $4,478 $15.35 7.1% $4,489 $15.29 6.7% $4,936 $16.44 7.9% $4,036 $14.31 7.3% $4,240 $14.85 Information and Telecommunications Systems 1.0% $612 $2.10 1.0% $608 $2.07 0.9% $648 $2.16 1.1% $557 $1.98 1.1% $613 $2.15 Marketing 12.0% $7,458 $25.55 11.9% $7,479 $25.48 11.2% $8,247 $27.46 12.8% $6,518 $23.12 12.4% $7,165 $25.09 Property Operations and Maintenance 4.0% $2,498 $8.56 3.9% $2,471 $8.42 3.8% $2,763 $9.20 4.4% $2,259 $8.01 4.1% $2,384 $8.35 Utilities 3.3% $2,036 $6.98 3.1% $1,971 $6.71 3.1% $2,277 $7.58 3.6% $1,808 $6.41 3.4% $1,984 $6.95 Total Undistributed Expenses 27.5% $17,082 $58.53 27.0% $17,018 $57.98 25.7% $18,871 $62.84 29.9% $15,178 $53.83 28.4% $16,387 $57.37

GROSS OPERATING PROFIT 41.6% $26,160 $89.45 41.7% $26,237 $89.39 43.9% $32,203 $107.24 39.6% $20,141 $71.43 40.2% $23,228 $81.32

Management Fee 3.4% $2,127 $7.28 3.4 % $2,133 $7.27 3.5 % $2,537 $8.45 3.5 % $1,802 $6.39 3.2 % $1,871 $6.55 INCOME BEFORE NON-OPERATING INCOME AND EXPENSES 38.2% $24,033 $82.17 38.3% $24,104 $82.13 40.4% $29,666 $98.79 36.1% $18,339 $65.04 37.0% $21,356 $74.77

NON-OPERATING INCOME AND EXPENSES Property Taxes 2.9% $1,856 $6.35 2.2% $1,391 $4.74 3.4% $2,520 $8.39 2.9% $1,482 $5.26 3.2% $1,844 $6.46 Insurance 0.7% $410 $1.41 0.7% $416 $1.42 0.6% $411 $1.37 0.9% $438 $1.55 0.7% $385 $1.35 Total Non-Operating Income and Expenses 13.9% $8,816 $30.11 13.2% $8,306 $28.30 16.0% $11,712 $39.00 12.0% $6,109 $21.67 13.6% $7,870 $27.55

NET INCOME (EBITDA) 24.3% $15,217 $52.07 25.1% $15,798 $53.83 24.5% $17,954 $59.79 24.1% $12,231 $43.38 23.4% $13,486 $47.22

Source: Trend® in the Hotel Industry USA Edition 2019, for the year 2018, CBRE Research/CBRE Hotels

Income Capitalization Approach

FIXED AND VARIABLE REVENUE AND EXPENSE ANALYSIS Operating revenues and expenses for hotels have a component that is fixed and a component that is variable with respect to increases or decreases in occupancy. The fixed component increases at an inflationary level, while the variable component is adjusted in proportion to the use of the hotel facility.

The applicable fixed and variable ratios were derived through discussions with hotel experts and are consistent with industry norms. These ratios and the associated revenue component drivers are illustrated as follows:

FIXED AND VARIABLE AMOUNTS COMPONENT FIXED % VARIABLE % VAR. DRIVER REVENUE Rooms N/A N/A N/A Food & Beverage 20.0% 80.0% Occ Rooms Other Operated Departments 30.0% 70.0% Occ Rooms Miscellaneous Income 20.0% 80.0% Occ Rooms DEPARTMENTAL EXPENSES Rooms Expense 60.0% 40.0% Occ Rooms Food & Beverage Expense 40.0% 60.0% Food Rev Other Operated Departments Expense 50.0% 50.0% MOR Rev UNDISTRIBUTED OPERATING EXPENSES Administrative and General 90.0% 10.0% Total Rev Information and Telecommunications Systems 85.0% 15.0% Total Rev Marketing 70.0% 30.0% Total Rev Property Operations and Maintenance 70.0% 30.0% Total Rev Utilities 90.0% 10.0% Total Rev Management Fee 0.0% 100.0% Total Rev FIXED CHARGES Property Taxes 100.0% 0.0% N/A Insurance 100.0% 0.0% N/A Reserve for Replacement 0.0% 100.0% N/A

Source: CBRE

Income Capitalization Approach

DEPARTMENTAL PROJECTIONS Rooms Department ROOMS REVENUES The subject’s and the comparable data revenues for this department as a percentage of total revenues, as a percentage of Rooms department revenues, and on a per occupied room basis are summarized as follows:

ROOMS REVENUE As a % of Per Available Per Occupied Year Total $ (000's) Revenue Room Room Subject Complete Calendar Year Ended: Dec 31, 2015 $10,986 95.2% $57,218 $168.51 Subject Complete Calendar Year Ended: Dec 31, 2016 $10,714 95.2% $55,802 $171.26 Subject Complete Calendar Year Ended: Dec 31, 2017 $10,480 95.0% $54,583 $174.89 Subject Complete Calendar Year Ended: Dec 31, 2018 $10,298 94.0% $53,635 $171.55 Subject Complete Calendar Year Ended: Dec 31, 2019 $10,466 92.4% $54,511 $174.69 Current Budget (Dec 31, 2020) $11,092 89.2% $57,769 $180.09

Comparable 1 $9,377 98.4% $63,358 $185.26 Comparable 2 $6,130 93.4% $51,951 $168.84 Comparable 3 $4,580 97.8% $40,893 $147.81 Comparable 4 $6,015 98.2% $48,122 $162.77

Trends® Report - Weighted Average N/A 82.6% $51,598 $176.65 Trends Report® - Suite Hotels With Food and Beverage - Mountain and Pacific N/A 81.3% $51,206 $174.47 Trends® Report - Suite Hotels With Food and Beverage - Over $170.00 N/A 81.8% $60,063 $200.02 Trends® Report - Suite Hotels With Food and Beverage - Under 200 Rooms N/A 85.4% $43,399 $153.92 Trends® Report - Suite Hotels With Food and Beverage N/A 82.9% $47,863 $167.57

HOST Report - Weighted Average N/A 96.8% $34,760 $122.99 HOST Report - Limited Service Pacific N/A 96.4% $40,558 $136.38 HOST Report - Limited Service Chain-Affiliated N/A 96.9% $31,058 $113.40 HOST Report - Limited Service Suburban N/A 97.8% $26,798 $98.94 HOST Report - Limited Service Upscale Class N/A 96.2% $42,360 $146.90 HOST Report - Limited Service Total U.S. N/A 96.7% $31,486 $114.99

CBRE Estimate $11,177 88.6% $58,214 $180.74

Compiled by CBRE Analysis of Rooms Department Revenues were previously provided.

ROOMS EXPENSES Rooms expenses include labor costs such as salaries and wages for front desk, housekeeping, reservations, bell staff and laundry, plus employee benefits. Also included herein are linens, cleaning supplies, guest supplies, uniforms, central or franchise reservation fees, equipment leases and travel agent commissions. In this case, travel agent commissions and other related costs are being included in franchise fees below because this is how the subject operating statements are constructed. Payroll costs are typically the largest component. A hotel is labor- intensive, although relatively low-paying. Overall, wages typically account for 50% to 60% of the total departmental expense. The comparable data and projections for the subject are summarized as follows:

Income Capitalization Approach

ROOMS EXPENSE As a % of Dept. Per Available Per Occupied Year Total $ (000's) Revenue Room Room Subject Complete Calendar Year Ended: Dec 31, 2016 $1,991 18.6% $10,368 $31.82 Subject Complete Calendar Year Ended: Dec 31, 2017 $2,113 20.2% $11,005 $35.26 Subject Complete Calendar Year Ended: Dec 31, 2018 $2,217 21.5% $11,547 $36.93 Subject Complete Calendar Year Ended: Dec 31, 2019 $2,341 22.4% $12,194 $39.08 Subject Trailing 12 Months Ending: Dec 31, 2019 $2,341 22.4% $12,194 $39.08 Current Budget (Dec 31, 2020) $2,453 22.1% $12,774 $39.82

Comparable 1 $1,714 18.3% $11,578 $33.85 Comparable 2 $1,280 20.9% $10,846 $35.25 Comparable 3 $972 21.2% $8,675 $31.35 Comparable 4 $1,227 20.4% $9,816 $33.20

Trends® Report - Weighted Average N/A 23.9% $12,326 $42.22 Trends Report® - Suite Hotels With Food and Beverage - Mountain and Pacific N/A 23.8% $12,186 $41.52 Trends® Report - Suite Hotels With Food and Beverage - Over $170.00 N/A 23.4% $14,077 $46.88 Trends® Report - Suite Hotels With Food and Beverage - Under 200 Rooms N/A 24.1% $10,454 $37.08 Trends® Report - Suite Hotels With Food and Beverage N/A 24.5% $11,733 $41.08

HOST Report - Weighted Average N/A 22.5% $7,805 $27.64 HOST Report - Limited Service Pacific N/A 21.2% $8,583 $28.86 HOST Report - Limited Service Chain-Affiliated N/A 22.8% $7,089 $25.88 HOST Report - Limited Service Suburban N/A 21.7% $5,822 $21.50 HOST Report - Limited Service Upscale Class N/A 23.2% $9,830 $34.09 HOST Report - Limited Service Total U.S. N/A 23.8% $7,367 $26.91

CBRE Estimate $2,442 21.8% $12,716 $39.48

Compiled by CBRE We have considered the comparables, the Trends Report and the historical levels in concluding the stabilized rooms expense estimate indicated above, estimated as a percent of Rooms Revenues.

Food & Beverage Department FOOD & BEVERAGE REVENUE Food & Beverage revenue is generated by a hotel's restaurants, lounges, coffee shops, snack bars, banquet rooms, and room service. The subject’s and the comparable data revenues for this department as a percentage of total revenues, on a per available room basis, and on a per occupied room basis are summarized as follows:

Income Capitalization Approach

FOOD & BEVERAGE REVENUE As a % of Per Available Per Occupied Year Total $ (000's) Revenue Room Room Subject Complete Calendar Year Ended: Dec 31, 2018 $0 0.0% $0 $0.00 Subject Complete Calendar Year Ended: Dec 31, 2019 $0 0.0% $0 $0.00 Current Budget (Dec 31, 2020) $501 4.0% $2,612 $8.14

Comparable 1 $0 0.0% $0 $0.00 Comparable 2 $0 0.0% $0 $0.00 Comparable 3 $0 0.0% $0 $0.00 Comparable 4 $0 0.0% $0 $0.00

Trends® Report - Weighted Average N/A 12.8% $8,039 $27.48 Trends Report® - Suite Hotels With Food and Beverage - Mountain and Pacific N/A 14.4% $9,037 $30.79 Trends® Report - Suite Hotels With Food and Beverage - Over $170.00 N/A 12.7% $9,356 $31.16 Trends® Report - Suite Hotels With Food and Beverage - Under 200 Rooms N/A 10.1% $5,134 $18.21 Trends® Report - Suite Hotels With Food and Beverage N/A 12.9% $7,425 $26.00

CBRE Estimate $541 4.3% $2,820 $8.76

Compiled by CBRE The subject completed a $500,000 renovation of the gatehouse in early 2020, which converted a portion of the gatehouse to a bar and lounge area. Based on discussions with property management, the bar and lounge area generated approximately $1,700 per night for the first 2 nights upon opening; however, the area was subsequently shut down upon the onset of the COVID-19 pandemic. Property ownership indicated a budget of approximately $501,000 of gross sales for Year 1, based primarily upon the operating performance of a similar Residence Inn property within their portfolio, offering a similar bar and lounge area but located outside of the subject market area. Therefore, we have placed primary reliance on the budget and the Residence Inn comparable, but have considered that the subject performance is likely to exceed the budgeted revenues for Year 1.

FOOD & BEVERAGE EXPENSES Food & Beverage expenses include the costs of goods sold (Food & Beverage), labor and related benefits, and other operating expenses. Labor costs include departmental management, cooks and kitchen personnel, service staff, banquet staff and bartenders. Other operating expenses include china, silverware, linens, restaurant and kitchen supplies, menus and printing, and special promotions. As with the rooms department, payroll costs are typically the largest component. The comparable data and projections for the subject are summarized as follows:

Income Capitalization Approach

FOOD & BEVERAGE EXPENSE As a % of Dept. Per Available Per Occupied Year Total $ (000's) Revenue Room Room Subject Complete Calendar Year Ended: Dec 31, 2018 $0 $0 $0.00 Subject Complete Calendar Year Ended: Dec 31, 2019 $0 $0 $0.00 Current Budget (Dec 31, 2020) $383 76.3% $1,994 $6.22

Comparable 1 $0 $0 $0.00 Comparable 2 $0 $0 $0.00 Comparable 3 $0 $0 $0.00 Comparable 4 $0 $0 $0.00

Trends® Report - Weighted Average N/A 75.8% $6,052 $20.70 Trends Report® - Suite Hotels With Food and Beverage - Mountain and Pacific N/A 74.5% $6,735 $22.95 Trends® Report - Suite Hotels With Food and Beverage - Over $170.00 N/A 73.8% $6,905 $23.00 Trends® Report - Suite Hotels With Food and Beverage - Under 200 Rooms N/A 81.6% $4,190 $14.86 Trends® Report - Suite Hotels With Food and Beverage N/A 75.5% $5,603 $19.62

CBRE Estimate $406 75.0% $2,115 $6.57

Compiled by CBRE We have projected Food & Beverage expenses as a percentage of Food & Beverage revenues, consistent with the subject budget and market data.

Other Operated Departments OTHER OPERATED DEPARTMENTS REVENUES Other Operated Departments revenues are those derived from guest laundry, gift shop, retail, newsstand, spa et cetera, when operated by the hotel. Also included are revenues generated from sources not included elsewhere, such as on-demand movie rentals, vending machines, fax and business services. The subject’s and the comparable data revenues for this department as a percentage of total revenues, on a per available room basis, and on a per occupied room basis are summarized as follows:

OTHER OPERATED DEPARTMENTS REVENUE As a % of Per Available Per Occupied Year Total $ (000's) Revenue Room Room Subject Complete Calendar Year Ended: Dec 31, 2016 $124 1.1% $646 $1.98 Subject Complete Calendar Year Ended: Dec 31, 2017 $45 0.4% $236 $0.75 Subject Complete Calendar Year Ended: Dec 31, 2018 $130 1.2% $679 $2.17 Subject Complete Calendar Year Ended: Dec 31, 2019 $142 1.3% $738 $2.37 Subject Trailing 12 Months Ending: Dec 31, 2019 $142 1.3% $738 $2.37 Current Budget (Dec 31, 2020) $138 1.1% $717 $2.24

Comparable 1 $121 1.3% $816 $2.39 Comparable 2 $433 6.6% $3,671 $11.93 Comparable 3 $71 1.5% $634 $2.29 Comparable 4 $103 1.7% $823 $2.78

Trends® Report - Weighted Average N/A 3.6% $2,294 $7.83 Trends Report® - Suite Hotels With Food and Beverage - Mountain and Pacific N/A 3.5% $2,234 $7.61 Trends® Report - Suite Hotels With Food and Beverage - Over $170.00 N/A 4.3% $3,145 $10.47 Trends® Report - Suite Hotels With Food and Beverage - Under 200 Rooms N/A 3.1% $1,566 $5.56 Trends® Report - Suite Hotels With Food and Beverage N/A 3.2% $1,875 $6.56

HOST Report - Weighted Average N/A 2.1% $784 $2.77 HOST Report - Limited Service Pacific N/A 2.1% $883 $2.97 HOST Report - Limited Service Chain-Affiliated N/A 2.1% $674 $2.46 HOST Report - Limited Service Suburban N/A 1.6% $436 $1.61 HOST Report - Limited Service Upscale Class N/A 2.6% $1,162 $4.03 HOST Report - Limited Service Total U.S. N/A 2.2% $710 $2.59

CBRE Estimate $148 1.2% $769 $2.39

Compiled by CBRE

Income Capitalization Approach

At the subject, this revenue source consists primarily of revenues from the market pantry and miscellaneous room revenues, as well as nominal guest laundry revenue.

OTHER OPERATED DEPARTMENTAL EXPENSES Other Operated Departmental expenses are those expenses (labor and other) which offset the revenue generated by other operated departments, such as garage, guest laundry, athletic facilities and gift shop, as well as rental activity. The comparable data and projections for the subject are summarized as follows:

OTHER OPERATED DEPARTMENTS EXPENSE As a % of Dept. Per Available Per Occupied Year Total $ (000's) Revenue Room Room Subject Complete Calendar Year Ended: Dec 31, 2016 $52 41.7% $270 $0.83 Subject Complete Calendar Year Ended: Dec 31, 2017 $56 124.6% $293 $0.94 Subject Complete Calendar Year Ended: Dec 31, 2018 $53 40.9% $277 $0.89 Subject Complete Calendar Year Ended: Dec 31, 2019 $40 28.0% $206 $0.66 Subject Trailing 12 Months Ending: Dec 31, 2019 $40 28.0% $206 $0.66 Current Budget (Dec 31, 2020) $54 38.9% $279 $0.87

Comparable 1 $48 39.8% $324 $0.95 Comparable 2 $38 8.9% $326 $1.06 Comparable 3 $29 40.6% $257 $0.93 Comparable 4 $24 23.0% $189 $0.64

Trends® Report - Weighted Average N/A 42.5% $962 $3.29 Trends Report® - Suite Hotels With Food and Beverage - Mountain and Pacific N/A 35.6% $795 $2.71 Trends® Report - Suite Hotels With Food and Beverage - Over $170.00 N/A 42.2% $1,327 $4.42 Trends® Report - Suite Hotels With Food and Beverage - Under 200 Rooms N/A 53.9% $844 $2.99 Trends® Report - Suite Hotels With Food and Beverage N/A 42.7% $801 $2.80

HOST Report - Weighted Average N/A 63.2% $496 $1.75 HOST Report - Limited Service Pacific N/A 58.7% $518 $1.74 HOST Report - Limited Service Chain-Affiliated N/A 64.8% $437 $1.59 HOST Report - Limited Service Suburban N/A 62.7% $274 $1.01 HOST Report - Limited Service Upscale Class N/A 65.1% $756 $2.62 HOST Report - Limited Service Total U.S. N/A 64.8% $460 $1.68

CBRE Estimate $44 30.0% $231 $0.72

Compiled by CBRE The subject other operated departmental expenses consist primarily of expenses associated with the market pantry.

Income Capitalization Approach

MISCELLANEOUS INCOME REVENUE Miscellaneous income revenues are generated primarily from parking fees, vending machine commissions, late cancellation fees, and other minor miscellaneous sources. The subject’s and the comparable data revenues for this department are summarized as follows:

MISCELLANEOUS INCOME REVENUE As a % of Per Available Per Occupied Year Total $ (000's) Revenue Room Room Subject Complete Calendar Year Ended: Dec 31, 2016 $414 3.7% $2,157 $6.62 Subject Complete Calendar Year Ended: Dec 31, 2017 $508 4.6% $2,645 $8.48 Subject Complete Calendar Year Ended: Dec 31, 2018 $532 4.9% $2,770 $8.86 Subject Complete Calendar Year Ended: Dec 31, 2019 $724 6.4% $3,773 $12.09 Subject Trailing 12 Months Ending: Dec 31, 2019 $724 6.4% $3,773 $12.09 Current Budget (Dec 31, 2020) $702 5.6% $3,656 $11.40

Comparable 1 $35 0.4% $234 $0.69 Comparable 2 $2 0.0% $20 $0.07 Comparable 3 $34 0.7% $302 $1.09 Comparable 4 $5 0.1% $42 $0.14

Trends® Report - Weighted Average N/A 1.0% $652 $2.23 PKF Trends Report - Suite Hotels With Food and Beverage - Mountain and Pacific N/A 0.8% $494 $1.68 PKF Trends Report - Suite Hotels With Food and Beverage - Over $170.00 N/A 1.1% $820 $2.73 PKF Trends Report - Suite Hotels With Food and Beverage - Under 200 Rooms N/A 1.4% $708 $2.51 PKF Trends Report - Suite Hotels With Food and Beverage N/A 1.0% $589 $2.06

HOST Report - Weighted Average N/A 1.1% $402 $1.41 HOST Report - Limited Service Pacific N/A 1.5% $635 $2.14 HOST Report - Limited Service Chain-Affiliated N/A 1.0% $317 $1.16 HOST Report - Limited Service Suburban N/A 0.6% $169 $0.62 HOST Report - Limited Service Upscale Class N/A 1.1% $490 $1.70 HOST Report - Limited Service Total U.S. N/A 1.1% $360 $1.32

CBRE Estimate $748 5.9% $3,898 $12.10

Compiled by CBRE The subject miscellaneous income revenues are primarily generated by on-site parking, at $20 per night per guest. Parking revenues totaled $654,001 in 2019. Additional miscellaneous revenues include guest no show fees, commissions, and miscellaneous Food & Beverage, among others. There are no offsetting expenses for the subject’s miscellaneous income sources.

Income Capitalization Approach

EXPENSE PROJECTIONS In order to estimate expenses for the subject, the following data has been reviewed and analyzed:

• available historical data for the subject; • published industry averages for similar hotel segments and geographic regions; and • actual operating expense data for similar properties.

When possible, hotel expenses are generally categorized into four basic categories as designated by the Uniform System of Accounts for the Lodging Industry, an industry-standard accounting format.

Departmental Expenses always include Rooms Department expenses and also may include Food and Beverage Department Expenses, Other Operated Department Expenses and Miscellaneous Income Expense.

Undistributed Expenses typically include Administrative and General expenses, Information and Telecommunications Systems expenses, Marketing expenses, Franchise Fees (if applicable), Property Operations and Maintenance expenses, and Utility expenses.

Management Expenses are typically included as its own category.

Non-Operating Income and Expenses include Real Estate Tax expenses, Insurance and Reserves for Replacement, and can also include Ground Rent charges and other miscellaneous expenses that are fixed in nature. We note the subject ground lease expense for a portion of the adjacent parking lot. We also note that our real estate tax projection considers a re-assessment to current market value.

Income Capitalization Approach

NET INCOME (EBITDA) CONCLUSION The subject’s net operating income is detailed as follows:

NET INCOME (EBITDA) As a % of Per Available Per Occupied Year Total $ (000's) Revenue Room Room Subject Complete Calendar Year Ended: Dec 31, 2016 $4,756 42.3% $24,772 $76.03 Subject Complete Calendar Year Ended: Dec 31, 2017 $4,305 39.0% $22,420 $71.84 Subject Complete Calendar Year Ended: Dec 31, 2018 $4,170 38.0% $21,717 $69.46 Subject Complete Calendar Year Ended: Dec 31, 2019 $4,329 38.2% $22,545 $72.25 Subject Trailing 12 Months Ending: Dec 31, 2019 $4,329 38.2% $22,545 $72.25 Current Budget (Dec 31, 2020) $4,734 38.1% $24,658 $76.87

Comparable 1 $4,539 47.6% $30,670 $89.68 Comparable 2 $3,144 47.9% $26,642 $86.58 Comparable 3 $1,826 39.0% $16,302 $58.92 Comparable 4 $2,629 42.9% $21,033 $71.14

Trends® Report - Weighted Average N/A 24.3% $15,217 $52.07 Trends Report® - Suite Hotels With Food and Beverage - Mountain and Pacific N/A 25.1% $15,798 $53.83 Trends® Report - Suite Hotels With Food and Beverage - Over $170.00 N/A 24.5% $17,954 $59.79 Trends® Report - Suite Hotels With Food and Beverage - Under 200 Rooms N/A 24.1% $12,231 $43.38 Trends® Report - Suite Hotels With Food and Beverage N/A 23.4% $13,486 $47.22

HOST Report - Weighted Average N/A 41.3% $14,917 $52.66 HOST Report - Limited Service Pacific N/A 47.1% $19,803 $66.59 HOST Report - Limited Service Chain-Affiliated N/A 39.6% $12,708 $46.40 HOST Report - Limited Service Suburban N/A 40.5% $11,098 $40.97 HOST Report - Limited Service Upscale Class N/A 39.6% $17,410 $60.38 HOST Report - Limited Service Total U.S. N/A 39.1% $12,734 $46.51

CBRE Estimate $4,758 37.7% $24,779 $76.94

Compiled by CBRE Overall, the projections appear reasonable based on historic trending at the subject and are supported by the comparative expenses reviewed. We note that our NOI projections consider market sentiment as of the effective date of value, February 25, 2020, prior to the onset of the COVID-19 pandemic.

Income Capitalization Approach

DISCOUNTED CASH FLOW ANALYSIS The discounted cash flow analysis relies on a projection of net operating income over a fixed holding period and a future sale of the property at the end of the holding period. This is consistent with current investor trends for analyzing this property type. The discounted cash flow analysis takes into consideration the timing and degree of the projected changes in average daily rate, occupancy, and expenses for the subject.

Financial Assumptions

SUMMARY OF DISCOUNTED CASH FLOW INPUT

General Start Date Feb-20 Terms of Analysis 10 Years Software Excel Growth Rates Stabilized ADR Growth 3.00% Stabilized Income Growth 3.00% Stabilized Expense Growth 3.00% Revenue Assumptions Current/TTM Average Daily Rate $174.69 Stabilized Average Daily Rate $180.74 Occupancy Assumptions Current/TTM Occupancy 85.49% Stabilized Occupancy 88.00% Estimated Stabilization Feb-20 Financial Discount Rate 9.00% Terminal Capitalization Rate 7.50% Other Cost of Sale 0.50% Compiled by CBRE CASH FLOW ASSUMPTIONS The discounted cash flow analysis relies on the income and expense projections presented earlier in this section. Specific assumptions integral to the analysis are summarized as follows.

GENERAL ASSUMPTIONS The DCF analysis utilizes a 10-year projection period with fiscal year inflation and discounting. This is consistent with current investor assumptions. The analysis is done with Excel software.

Income Capitalization Approach

GROWTH RATE ASSUMPTIONS The inflation and growth rates for the DCF analysis have been estimated by analyzing the expectations typically used by buyers and sellers in the local marketplace. Published investor surveys, an analysis of the Consumer Price Index (CPI), as well as CBRE's survey of brokers and investors active in the local market form the foundation for the selection of the appropriate growth rates.

SUMMARY OF GROWTH RATES Investment Type Revenue Expenses Inflation

U.S. Bureau of Labor Statistics (CPI-U) 10-Year Snapshot Average as of Jun-20 1.69%

PwC Survey: (1st Qtr. 2020) Luxury 2.20% 2.70% --- Full Service 1.90% 2.80% --- Limited Service 2.10% 3.15% --- Select Service 3.00% 3.85% --- CBRE Estimate 2.70% 3.00% 3.00% Compiled by: CBRE OCCUPANCY ASSUMPTIONS The occupancy rate over the holding period is based on the subject’s estimated stabilized occupancy rate. The complete discussion and analysis of occupancy is located in the Hotel Market Analysis.

HOTEL INVESTOR RATES Provided on the following pages is a discussion of the direct capitalization, discount, and terminal capitalization rates.

Direct Capitalization Direct capitalization is a method used to convert a single year’s estimated stabilized net operating income into a value indication. The following subsections represent different techniques for deriving an overall capitalization rate for direct capitalization. This figure will be used in a direct capitalization table presented following the discounted cash flow analysis. It also impacts the terminal capitalization rate selection.

Income Capitalization Approach

COMPARABLE SALES The overall capitalization rates (OAR’s) confirmed for the comparable sales analyzed in the sales comparison approach are as follows:

COMPARABLE CAPITALIZATION RATES Name Sale Sale Price Sale Location Date $/Room OAR Basis OAR 1 Residence Inn Riverside, Mar-20 $234,375 Pro Forma Stabilized 7.50% 12940 Day Street, Moreno Valley, CA 2 Residence Inn, Aug-19 $296,667 Pro Forma Stabilized 7.82% 321 East Huntington Drive, Arcadia, CA 3 Residence Inn Long Beach, Aug-19 $230,556 Pro Forma Stabilized 7.87% 4111 East Willow Street, Long Beach, CA 4 Residence Inn - Anaheim Hills, Jan-19 $199,219 Trailing Actuals 7.50% 125 S Festival Drive, Anaheim,, CA 5 Courtyard by Marriott, Sep-19 $280,757 Pro Forma Year 1 7.94% 595 Hotel Circle South, San Diego, CA 6 Hampton Inn, Aug-18 $242,021 Pro Forma Stabilized 7.23% 2229 Palomar Airport Inn, Carlsbad, CA 7 West Inn & Suites Carlsbad, May-18 $226,744 Pro Forma Year 1 7.27% 4970 Avenida Encinas, Carlsbad, CA 8 Homewood Suites by Hilton, Dec-17 $227,586 Trailing Actuals 7.04% 2223 Palomar Airport Road, Carlsbad, CA Indicated OAR: 7.04%-7.94% Compiled by: CBRE Based on the subject’s projected stabilized occupancy level, recent $3.3 million renovation in 2018, strong historical occupancy and ADR, and competitive position in the local market, an OAR at the low end of the range indicated by the comparables is considered appropriate for the subject. We note that our capitalization rate analysis considers investor sentiment as of the effective date of value, February 25, 2020, prior to the onset of the COVID-19 pandemic.

Income Capitalization Approach

PUBLISHED INVESTOR SURVEYS The results of the most recent investor survey data are summarized in the following table.

OVERALL CAPITALIZATION RATES Investment Type OAR Range Average CBRE Hotels (2nd Half 2019) Economy 9.22% Full Service 7.76% Luxury 7.01% Select Service 8.00%

PwC Survey: (1st Qtr. 2020) Luxury 4.00% - 9.50% 7.05% Full Service 6.00% - 9.00% 7.38% Limited Service 7.50% - 11.00% 9.10% Select Service 6.00% - 10.00% 8.15%

Indicated OAR: 6.50%-7.50%

Compiled by: CBRE Please note that these preceding surveys were performed prior to the COVID-19 pandemic and do not reflect current market risk tolerances for investors. The subject is considered to be an extended stay hotel property. Because of the subject’s recent $3.3 million renovation, location in Southern California, amenities, franchise affiliation, and age & condition, an OAR near the low end of the range indicated in the preceding table is considered appropriate.

MARKET PARTICIPANTS Our discussions with market participants indicated that capitalization rates for nationally franchised extended stay and limited service properties in the market generally ranged from 7.0% to 8.0%, prior to the onset of the COVID-19 pandemic. Discussions with market participants revealed that a likely 25 to 100 basis point increase in investor rates (capitalization and discount rates) from those prior to the onset of the COVID-19 pandemic is reasonable to account for the future risk of uncertainty. However, our rate analysis for purposes of this analysis reflects pre- COVID investor sentiment.

Income Capitalization Approach

CAPITALIZATION RATE CONCLUSION The following table summarizes the OAR conclusions.

OVERALL CAPITALIZATION RATE - CONCLUSION Source Indicated OAR Comparable Sales 7.04%-7.94% Published Surveys 6.50%-7.50% Market Participants 7.00%-8.00% CBRE Estimate 7.00% Compiled by: CBRE Discount Rate Analysis The results of the most recent PwC Real Estate Investor Survey are summarized in the following table.

DISCOUNT RATES Investment Type Rate Range Average PwC Survey: (1st Qtr. 2020) Luxury 6.25% - 12.00% 9.30% Full Service 8.50% - 11.00% 9.95% Limited Service 7.50% - 12.00% 10.00% Select Service 8.00% - 12.00% 10.00% CBRE Estimate 9.00% Compiled by: CBRE Overall, a rate in the lower portion of the range indicated on the preceding table is considered appropriate, due to the characteristics of the subject. Discount rates are typically 150 to 300 basis points higher than OARs on average. We have concluded to a 200 basis point spread over the going-in capitalization rate for the As Is value scenario, which is consistent with the spread indicated by the investor surveys.

Terminal Capitalization Rate The reversionary value of the subject is based on an assumed sale at the end of the holding period based on capitalizing the Year 11 NOI at a terminal capitalization rate. Typically, for properties similar to the subject, terminal capitalization rates are 25 to 50 basis points higher than going-in capitalization rates (OAR’s). This is a result of the uncertainty of future economic conditions and the natural aging of the property, but assuming adequate reserves have been utilized to keep the property in good operating condition.

Income Capitalization Approach

TERMINAL CAPITALIZATION RATES Investment Type Rate Range Average PwC Survey: (1st Qtr. 2020) Luxury 5.50% - 9.50% 7.53% Full Service 7.00% - 10.00% 8.25% Limited Service 7.75% - 12.00% 9.33% Select Service 7.00% - 10.00% 8.43% Concluded BP Spread 50 CBRE Estimate 7.50% Compiled by: CBRE

DISCOUNTED CASH FLOW CONCLUSION The following pages present the following illustrations:

• Detailed Forecast Schedule • Discounted Cash Flow Schedule • Discounted Cash Flow Value Conclusion

Income Capitalization Approach

AS IS DISCOUNTED CASH FLOW SCHEDULE

RESIDENCE INN BY MARRIOTT - HOTEL CIRCLE DISCOUNTED CASH FLOW ANALYSIS BEGINNING 02/20

YEAR 1 2 3 4 5 6 7 8 9 10 Reversion Year Ended: 2/24/21 2/24/22 2/24/23 2/24/24 2/24/25 2/24/26 2/24/27 2/24/28 2/24/29 2/24/30 2/24/31 Number of Rooms 192 192 192 192 192 192 192 192 192 192 192 Annual Available Rooms 70,272 70,080 70,080 70,080 70,272 70,080 70,080 70,080 70,272 70,080 70,080 Occupied Rooms 61,839 61,670 61,670 61,670 61,839 61,670 61,670 61,670 61,839 61,670 61,670 Occupancy 88.0% 88.0% 88.0% 88.0% 88.0% 88.0% 88.0% 88.0% 88.0% 88.0% 88.0% Average Rate $180.74 $183.45 $187.12 $191.80 $197.56 $203.48 $209.59 $215.87 $222.35 $229.02 $235.89 REVENUE Rooms $11,177,012 $11,313,671 $11,539,944 $11,828,443 $12,216,675 $12,548,795 $12,925,259 $13,313,017 $13,749,975 $14,123,779 $14,547,493 Food & Beverage 541,404 556,427 578,684 601,831 627,276 657,200 690,060 724,563 762,457 798,830 830,784 Other Operated Departments 147,612 151,750 157,820 164,132 171,025 177,526 184,627 192,012 200,075 207,680 215,987 Miscellaneous Income 748,411 769,178 799,945 831,943 867,116 899,830 935,823 973,256 1,014,403 1,052,674 1,094,780 Total Operating Revenue $12,614,439 $12,791,026 $13,076,393 $13,426,350 $13,882,092 $14,283,350 $14,735,768 $15,202,847 $15,726,911 $16,182,963 $16,689,044 DEPARTMENTAL EXPENSES Rooms Expense $2,441,530 $2,512,085 $2,587,447 $2,665,071 $2,747,964 $2,827,373 $2,912,195 $2,999,561 $3,092,858 $3,182,234 $3,277,701 Food & Beverage Expense 406,053 417,686 430,216 443,123 457,016 470,109 484,212 498,739 514,375 529,112 544,985 Other Operated Departments Expense 44,284 45,569 46,936 48,344 49,842 51,288 52,826 54,411 56,097 57,725 59,457 Total Departmental Expenses $2,891,867 $2,975,339 $3,064,599 $3,156,537 $3,254,822 $3,348,770 $3,449,233 $3,552,710 $3,663,330 $3,769,070 $3,882,143 DEPARTMENTAL PROFIT $9,722,572 $9,815,687 $10,011,794 $10,269,813 $10,627,270 $10,934,580 $11,286,535 $11,650,137 $12,063,581 $12,413,893 $12,806,901 UNDISTRIBUTED OPERATING EXPENSES Administrative and General $946,382 $974,521 $1,003,757 $1,033,869 $1,065,162 $1,096,832 $1,129,737 $1,163,629 $1,198,849 $1,234,494 $1,271,529 Information and Telecommunications Systems 45,352 46,695 48,096 49,539 51,045 52,555 54,132 55,756 57,451 59,152 60,926 Marketing 1,219,085 1,254,675 1,292,315 1,331,084 1,372,091 1,412,147 1,454,512 1,498,147 1,544,300 1,589,384 1,637,066 Property Operations and Maintenance 480,124 494,141 508,965 524,234 540,384 556,160 572,845 590,030 608,207 625,963 644,742 Utilities 473,191 487,261 501,878 516,935 532,581 548,416 564,869 581,815 599,425 617,247 635,765 Total Undistributed Expenses $3,164,135 $3,257,292 $3,355,011 $3,455,661 $3,561,262 $3,666,111 $3,776,094 $3,889,377 $4,008,232 $4,126,240 $4,250,027 GROSS OPERATING PROFIT $6,558,436 $6,558,395 $6,656,783 $6,814,152 $7,066,008 $7,268,469 $7,510,441 $7,760,760 $8,055,349 $8,287,653 $8,556,874 Management Fee $378,433 $383,731 $392,292 $402,790 $416,463 $428,501 $442,073 $456,085 $471,807 $485,489 $500,671 INCOME BEFORE NON-OPERATING INCOME AND EXPENSES $6,180,003 $6,174,664 $6,264,492 $6,411,361 $6,649,545 $6,839,969 $7,068,368 $7,304,674 $7,583,541 $7,802,164 $8,056,203 NON-OPERATING INCOME AND EXPENSES Property Taxes $837,715 $854,469 $871,559 $888,990 $906,770 $924,905 $943,403 $962,271 $981,517 $1,001,147 $1,021,170 Insurance 80,093 82,496 84,970 87,520 90,145 92,850 95,635 98,504 101,459 104,503 107,638 Reserve for Replacement 504,578 511,641 523,056 537,054 555,284 571,334 589,431 608,114 629,076 647,319 667,562 Total Non-Operating Income and Expenses $1,422,385 $1,448,606 $1,479,585 $1,513,563 $1,552,198 $1,589,089 $1,628,469 $1,668,889 $1,712,052 $1,752,968 $1,796,370 NET INCOME (EBITDA) $4,757,618 $4,726,058 $4,784,907 $4,897,798 $5,097,347 $5,250,880 $5,439,899 $5,635,785 $5,871,489 $6,049,196 $6,259,833

REVENUE AND NOI TREND Sale / Yield Matrix

$18,000,000 Terminal Cap Rate 7.25% 7.50% 7.75% $16,000,000 Total Revenue Total Expenses NOI IRR $14,000,000 8.75% 70,530,516 69,292,763 68,134,865 9.00% 69,303,541 68,093,886 66,962,273 $12,000,000 9.25% 68,104,258 66,922,000 65,816,017 $10,000,000

$8,000,000 Reconciled Value Indication: $68,093,886 $6,000,000 Property Improvement Plan Cost: $0 $4,000,000

$2,000,000 As-Is Value Indication (Rounded): $68,100,000

$0 $354,688/Room 1 2 3 4 5 6 7 8 9 10 Year

Income Capitalization Approach

RESIDENCE INN BY MARRIOTT - HOTEL CIRCLE - SAN DIEGO, CALIFORNIA DISCOUNTED CASH FLOW ANALYSIS - AS IS ANNUAL YEAR NET DISCOUNT PRESENT COMPOSITION CASH ON CASH ENDING CASH FLOW FACTOR VALUE OF YIELD RETURN 9.00% 2/24/2021 $4,757,618 * 0.91743 = $4,364,786 6.41% 6.99% 2/24/2022 $4,726,058 * 0.84168 = $3,977,829 5.84% 6.94% 2/24/2023 $4,784,907 * 0.77218 = $3,694,824 5.43% 7.03% 2/24/2024 $4,897,798 * 0.70843 = $3,469,722 5.10% 7.19% 2/24/2025 $5,097,347 * 0.64993 = $3,312,924 4.87% 7.49% 2/24/2026 $5,250,880 * 0.59627 = $3,130,927 4.60% 7.71% 2/24/2027 $5,439,899 * 0.54703 = $2,975,810 4.37% 7.99% 2/24/2028 $5,635,785 * 0.50187 = $2,828,409 4.15% 8.28% 2/24/2029 $5,871,489 * 0.46043 = $2,703,398 3.97% 8.62% 2/24/2030 $6,049,196 * 0.42241 = $2,555,247 3.75% 8.88%

Total Present Value of Cash Flows $33,013,875 48.48% 7.71% Average REVERSION

2/24/2031 $6,259,833 / 7.50% $83,464,446 Less: Cost of Sale @ 0.50% ($417,322) Net Reversion $83,047,124 Discount Factor 0.42241 Total Present Value of Reversion $35,080,019 51.52% Total Present Value $68,093,886 100.00% Property Improvement Plan Cost $0 ROUNDED: $68,100,000 Number of Rooms 192 Estimated Value Per Room $354,688 Compiled by CBRE

Income Capitalization Approach

DIRECT CAPITALIZATION SUMMARY A summary of the direct capitalization of the subject is illustrated in the following table.

DIRECT CAPITALIZATION SUMMARY

Period Ending: Analysis Premise Discounted Cash Flow YR 1 Income 2/24/2021 Number of Rooms: 192 Annual Rooms Available: 70,272 Occupied Rooms: 61,839 Occupancy: 88.0% Average Rate: $180.74 RevPAR: $159.05 Total Ratio to Sales PAR POR REVENUE Rooms $11,177,012 88.6% $58,214 $180.74 Food & Beverage $541,404 4.3% 2,820 8.76 Other Operated Departments $147,612 1.2% 769 2.39 Miscellaneous Income $748,411 5.9% 3,898 12.10 Total Operating Revenue $12,614,439 100.0% $65,700 $203.99 DEPARTMENTAL EXPENSES Rooms Expense $2,441,530 21.8% $12,716 $39.48 Food & Beverage Expense $406,053 75.0% 2,115 6.57 Other Operated Departments Expense $44,284 30.0% 231 0.72 Total Departmental Expenses $2,891,867 22.9% $15,062 $46.76 DEPARTMENTAL PROFIT $9,722,572 77.1% $50,638 $157.22 UNDISTRIBUTED OPERATING EXPENSES Administrative and General $946,382 7.5% $4,929 $15.30 Information and Telecommunications Systems $45,352 0.4% 236 0.73 Marketing $1,219,085 9.7% 6,349 19.71 Property Operations and Maintenance $480,124 3.8% 2,501 7.76 Utilities $473,191 3.8% 2,465 7.65 Total Undistributed Expenses $3,164,135 25.1% $16,480 $51.17 GROSS OPERATING PROFIT $6,558,436 52.0% $34,159 $106.06 Management Fee $378,433 3.0% $1,971 $6.12 INCOME BEFORE NON-OPERATING INCOME & EXPENSES $6,180,003 49.0% $32,188 $99.94 NON-OPERATING INCOME AND EXPENSES Property Taxes $837,715 6.6% $4,363 $13.55 Insurance $80,093 0.6% 417 1.30 Reserve for Replacement $504,578 4.0% 2,628 8.16 Total Non-Operating Income and Expenses $1,422,385 11.3% $7,408 $23.00 NET INCOME (EBITDA) $4,757,618 37.7% $24,779 $76.94 Net Income (EBITDA) $4,757,618 OAR / 7.00% Indicated Stabilized Value $67,965,971 Rounded $68,000,000 Property Improvement Plan Cost - Stabilization Discount - Indicated As Is Value $67,965,971 Rounded $68,000,000 Value Per Room $354,167 * Departmental expense ratios are based on departmental revenues; Franchise/Royalty ratio is based on room revenues; all others are based on total revenues. Compiled by CBRE

Income Capitalization Approach

CONCLUSION OF INCOME CAPITALIZATION APPROACH The conclusions via the valuation methods employed for this approach are as follows:

INCOME CAPITALIZATION APPROACH VALUES As Is on February 25, 2020 Direct Capitalization Method $68,000,000 Discounted Cash Flow Analysis $68,100,000 Reconciled Value $68,100,000 Compiled by CBRE Equal emphasis has been placed on both techniques as they are both considered to reflect the actions of buyers and sellers currently active in this market. We note that the two approaches are mutually supportive.

As noted, the market is currently undergoing significant impacts from the coronavirus pandemic. However, our income approach analysis reflects market conditions and investor sentiment as of the effective date of value in February 2020, and the subject is considered to be stabilized as of the effective date.

Sales Comparison Approach

The following map and table summarize the comparable data used in the valuation of the subject. A detailed description of each transaction is included in the addenda.

Sales Comparison Approach

SUMMARY OF COMPARABLE HOTEL SALES Transaction Year No. Actual Sale Adjusted Sale Price Per NOI Per No. Name Type Date Built Rooms Price Price 1 Room Room OAR

1 Residence Inn Riverside, Sale Mar-20 2020 112 $26,250,000 $26,250,000 $234,375 $17,578 7.50% 12940 Day Street, Moreno Valley, CA 2 Residence Inn, Sale Aug-19 1989 120 $32,000,000 $35,600,000 $296,667 $23,199 7.82% 321 East Huntington Drive, Arcadia, CA 3 Residence Inn Long Beach, Sale Aug-19 1987 216 $45,000,000 $49,800,000 $230,556 $18,145 7.87% 4111 East Willow Street, Long Beach, CA 4 Residence Inn - Anaheim Hills, Sale Jan-19 2002 128 $25,500,000 $25,500,000 $199,219 $14,941 7.50% 125 S Festival Drive, Anaheim,, CA 5 Courtyard by Marriott, Sale Sep-19 1974 317 $79,000,000 $89,000,000 $280,757 $22,292 7.94% 595 Hotel Circle South, San Diego, CA 6 Hampton Inn, Sale Aug-18 2007 94 $22,750,000 $22,750,000 $242,021 $17,498 7.23% 2229 Palomar Airport Inn, Carlsbad, CA 7 West Inn & Suites Carlsbad, Sale May-18 2006 86 $19,500,000 $19,500,000 $226,744 $16,484 7.27% 4970 Avenida Encinas, Carlsbad, CA 8 Homewood Suites by Hilton, Sale Dec-17 2008 145 $33,000,000 $33,000,000 $227,586 $16,022 7.04% 2223 Palomar Airport Road, Carlsbad, CA

Subj. Residence Inn By Marriott - Hotel Circle, ------2003 192 ------Pro 1865 Hotel Circle South, Forma San Diego, California

1 Adjusted sale price for cash equivalency, lease-up and/or deferred maintenance (where applicable) Compiled by CBRE COMPARABLE SELECTION

Our initial search focused on sales of similar Residence Inn by Marriott extended stay hotels in the San Diego market that occurred since January 2019. We then expanded our search to include sales of other national franchised extended stay, limited service, select service, and full service hotel properties in the San Diego market, to appropriately reflect market conditions in San Diego. Finally, we expanded our search back to late 2017 and expanded our search to include Residence Inn by Marriott and other upscale and upper midscale properties throughout the Southern California market, recognizing that these properties represent viable substitutions for potential investors.

It is noted that our effective date of appraisal is February 25, 2020; however, we have also included transactions in our sales search that were under contract as of the effective date of appraisal and have subsequently closed escrow in the following months.

The sales utilized represent the best data available for comparison with the subject. These sales were chosen based upon their physical and locational similarities to the subject, with a focus on similar nationally franchised hotel properties.

Sales Comparison Approach

Market Conditions Adjustment Our market conditions adjustment factors in a 3% annual increase in values through the effective date of appraisal. The market conditions adjustment is detailed in the following chart.

HOTEL SALES ADJUSTMENT GRID Subj. Comparable Number 1 2 3 4 5 6 7 8 Pro Forma Transaction Type Sale Sale Sale Sale Sale Sale Sale Sale --- Transaction Date Mar-20 Aug-19 Aug-19 Jan-19 Sep-19 Aug-18 May-18 Dec-17 --- Year Built 2020 1989 1987 2002 1974 2007 2006 2008 2003 No. Rooms 112 120 216 128 317 94 86 145 192 Actual Sale Price $26,250,000 $32,000,000 $45,000,000 $25,500,000 $79,000,000 $22,750,000 $19,500,000 $33,000,000 --- Adjusted Sale Price 1 $26,250,000 $35,600,000 $49,800,000 $25,500,000 $89,000,000 $22,750,000 $19,500,000 $33,000,000 --- Price Per Room $234,375 $296,667 $230,556 $199,219 $280,757 $242,021 $226,744 $227,586 --- NOI Per Room $17,578 $23,199 $18,145 $14,941 $22,292 $17,498 $16,484 $16,546 --- OAR 7.50% 7.82% 7.87% 7.50% 7.94% 7.23% 7.27% 7.27% --- Adj. Price Per Room $234,375 $296,667 $230,556 $199,219 $280,757 $242,021 $226,744 $227,586 Property Rights Conveyed 0% 0% 0% 0% 0% 0% 0% 0% Financing Terms 1 0% 0% 0% 0% 0% 0% 0% 0% Conditions of Sale 0% 0% 0% 0% 0% 0% 0% 0% Market Conditions 0% 2% 2% 3% 1% 5% 5% 7% Subtotal - Price Per Room $234,375 $302,600 $235,167 $205,195 $283,565 $254,122 $238,081 $243,517 1 Adjusted for cash equivalency, lease-up and/or deferred maintenance (where applicable) Compiled by CBRE NOI Analysis We have analyzed the above comparable properties in comparison to the subject property via a Net Income analysis. In performing this analysis, a ratio is calculated by dividing the subject’s stabilized net income by the comparables net income. This ratio is then applied to the per room sale price of the comparable, yielding a per room value estimate for the subject property.

NET INCOME MULTIPLIER ANALYSIS Indicated Sale No. Price/Room NOI/Room NIM Subj NOI Value/Room 1 $234,375 ÷ $17,578 = 13.33 x $24,779 = $330,390 2 $302,600 ÷ $23,199 = 13.04 x $24,779 = $323,208 3 $235,167 ÷ $18,145 = 12.96 x $24,779 = $321,154 4 $205,195 ÷ $14,941 = 13.73 x $24,779 = $340,302 5 $283,565 ÷ $22,292 = 12.72 x $24,779 = $315,202 6 $254,122 ÷ $17,498 = 14.52 x $24,779 = $359,865 7 $238,081 ÷ $16,484 = 14.44 x $24,779 = $357,885 8 $243,517 ÷ $16,022 = 15.20 x $24,779 = $376,617 Compiled by CBRE

SUPPLEMENTAL SALES ANALYSIS We note one additional comparable, which was excluded from our direct comparison analysis. The 144-room Residence Inn by Marriott San Diego Central property located at 5400 Kearny Mesa Road in San Diego is currently under contract for $39,500,000, or $274,306 per room. The potential buyer is the San Diego Housing Commission, and the buyer’s intended use is for conversion to affordable housing. The property was not actively marketed for sale, and the buyer approached the seller directly. Based on information provided by property representatives, the contract price is considered to be market-oriented, and the purchase price was based on the

Sales Comparison Approach market value of the property considering the current revenue generating potential of the current hotel use. Since this property is being purchased for residential conversion, we have excluded the comparable from our direct comparison analysis; however, since the purchase price was based on continued hotel use, we have considered the comparison of this property to the subject.

In comparison to the subject, this comparable features inferior construction and inferior age/condition, as the property was most recently renovated in 2013. In addition, the subject benefits from extensive parking revenues and Food & Beverage revenues, and this comparable generates nominal miscellaneous revenues and no Food & Beverage revenues.

In addition, this contract was based on market values as of July 2020, which considers the impact of COVID-19 on the market, and the concluded market value of this appraisal report is based on an effective date of February 25, 2020, prior to the onset of the COVDI-19 pandemic.

Accordingly, this current contract at $274,306 per room is considered to be below the achievable range for the subject property, but offers insight into the market.

SUBJECT CONTRACT A Letter of Intent to purchase the subject property was executed on August 5, 2020, at a price of $67,000,000. The potential buyer is the San Diego Housing Commission, and the buyer’s intended use is for conversion to affordable housing. The property was not actively marketed for sale, and the buyer approached the seller directly. Based on information provided by property representatives, the contract price is considered to be market-oriented, and the purchase price was based on the market value of the property considering the current revenue generating potential of the current hotel use. We have considered the current Letter of Intent in our reconciliation.

SALE COMPARISON APPROACH CONCLUSION We have examined the sales comparison approach under the relationship between net operating income and price per room. This analysis produced a range in values between $315,202 and $364,702 per room, with an average of $339,088 per room. We have considered all of the comparable data, as the Residence Inn sales are located outside of the immediate market area, and the additional hotel sales reflect local market conditions in the San Diego County market area. Considerate of the subject relatively large parcel size, relatively low FAR, and recent renovations, we have concluded near the upper end of the range.

As noted, the market is currently undergoing significant impacts from the coronavirus pandemic. However, our sales comparison approach reflects market conditions and investor sentiment as of the effective date of value in February 2020, and the subject is considered to be stabilized as of the effective date.

Sales Comparison Approach

Based on the previous analysis, the following chart presents the valuation conclusion.

SALES COMPARISON APPROACH

Total Rooms X Value Per Room = Value 192 X $325,000 = $62,400,000 192 X $375,000 = $72,000,000

VALUE CONCLUSION Indicated Stabilized Value $67,700,000 Property Improvement Plan Cost $0 Stabilization Discount $0 Indicated As Is Value $67,700,000 Rounded $67,700,000 Value Per Room $352,604

Compiled by CBRE

Reconciliation of Value

The value indications from the approaches to value are summarized as follows:

SUMMARY OF VALUE CONCLUSIONS As Is on February 25, 2020 Sales Comparison Approach $67,700,000 Income Capitalization Approach $68,100,000 Reconciled Value $68,100,000 Compiled by CBRE In the sales comparison approach, the subject is compared to similar properties that have been sold recently or for which listing prices or offers are known. The sales used in this analysis are considered highly comparable to the subject, and the required adjustments were based on reasonable and well-supported rationale. In addition, market participants are currently analyzing purchase prices on investment properties as they relate to available substitutes in the market. Therefore, the sales comparison approach is considered to provide a reliable value indication but has been given secondary emphasis in the final value reconciliation.

The income capitalization approach is applicable to the subject since it is an income producing property leased in the open market. Market participants are primarily analyzing properties based on their income generating capability. Therefore, the income capitalization approach is considered a reasonable and substantiated value indicator and has been given primary emphasis in the final value estimate.

Based on the foregoing, the fair value of the subject has been concluded as follows:

MARKET VALUE CONCLUSION Appraisal Premise Interest Appraised Date of Value Value Conclusion As Is Fee Simple Estate February 25, 2020 $68,100,000 Compiled by CBRE The opinion of fair value includes the land, the improvements thereto, and the contributory value of the furniture, fixtures, and equipment. The appraisers assume that the hotel will be, and shall remain, open and operational.

The effective date of value is February 25, 2020. As of the effective date of appraisal, the hotel market was not yet feeling the effects of the COVID-19 pandemic, which began to be felt in the United States market in March 2020. As of the date of report in August 2020, the nation, region, and market area are impacted by the COVID-19 pandemic, which could have a prolonged effect on macroeconomic conditions. Therefore, we note that the valuation conclusions contained herein represent the market conditions as of the effective date of appraisal, prior to the onset of the COVID-19 pandemic.

Assumptions and Limiting Conditions

1. CBRE, Inc. through its appraiser (collectively, “CBRE”) has inspected through reasonable observation the subject property. However, it is not possible or reasonably practicable to personally inspect conditions beneath the soil and the entire interior and exterior of the improvements on the subject property. Therefore, no representation is made as to such matters. 2. The report, including its conclusions and any portion of such report (the “Report”), is as of the date set forth in the letter of transmittal and based upon the information, market, economic, and property conditions and projected levels of operation existing as of such date. The dollar amount of any conclusion as to value in the Report is based upon the purchasing power of the U.S. Dollar on such date. The Report is subject to change as a result of fluctuations in any of the foregoing. CBRE has no obligation to revise the Report to reflect any such fluctuations or other events or conditions which occur subsequent to such date. 3. Unless otherwise expressly noted in the Report, CBRE has assumed that: (i) Title to the subject property is clear and marketable and that there are no recorded or unrecorded matters or exceptions to title that would adversely affect marketability or value. CBRE has not examined title records (including without limitation liens, encumbrances, easements, deed restrictions, and other conditions that may affect the title or use of the subject property) and makes no representations regarding title or its limitations on the use of the subject property. Insurance against financial loss that may arise out of defects in title should be sought from a qualified title insurance company. (ii) Existing improvements on the subject property conform to applicable local, state, and federal building codes and ordinances, are structurally sound and seismically safe, and have been built and repaired in a workmanlike manner according to standard practices; all building systems (mechanical/electrical, HVAC, elevator, plumbing, etc.) are in good working order with no major deferred maintenance or repair required; and the roof and exterior are in good condition and free from intrusion by the elements. CBRE has not retained independent structural, mechanical, electrical, or civil engineers in connection with this appraisal and, therefore, makes no representations relative to the condition of improvements. CBRE appraisers are not engineers and are not qualified to judge matters of an engineering nature, and furthermore structural problems or building system problems may not be visible. It is expressly assumed that any purchaser would, as a precondition to closing a sale, obtain a satisfactory engineering report relative to the structural integrity of the property and the integrity of building systems. (iii) Any proposed improvements, on or off-site, as well as any alterations or repairs considered will be completed in a workmanlike manner according to standard practices. (iv) Hazardous materials are not present on the subject property. CBRE is not qualified to detect such substances. The presence of substances such as asbestos, urea formaldehyde foam insulation, contaminated groundwater, mold, or other potentially hazardous materials may affect the value of the property. (v) No mineral deposit or subsurface rights of value exist with respect to the subject property, whether gas, liquid, or solid, and no air or development rights of value may be transferred. CBRE has not considered any rights associated with extraction or exploration of any resources, unless otherwise expressly noted in the Report. (vi) There are no contemplated public initiatives, governmental development controls, rent controls, or changes in the present zoning ordinances or regulations governing use, density, or shape that would significantly affect the value of the subject property. (vii) All required licenses, certificates of occupancy, consents, or other legislative or administrative authority from any local, state, nor national government or private entity or organization have been or can be readily obtained or renewed for any use on which the Report is based. (viii) The subject property is managed and operated in a prudent and competent manner, neither inefficiently or super-efficiently. (ix) The subject property and its use, management, and operation are in full compliance with all applicable federal, state, and local regulations, laws, and restrictions, including without limitation environmental laws, seismic hazards, flight patterns, decibel levels/noise envelopes, fire hazards, hillside ordinances, density, allowable uses, building codes, permits, and licenses. (x) The subject property is in full compliance with the Americans with Disabilities Act (ADA). CBRE is not qualified to assess the subject property’s compliance with the ADA, notwithstanding any discussion of possible readily achievable barrier removal construction items in the Report.

Assumptions and Limiting Conditions

(xi) All information regarding the areas and dimensions of the subject property furnished to CBRE are correct, and no encroachments exist. CBRE has neither undertaken any survey of the boundaries of the subject property nor reviewed or confirmed the accuracy of any legal description of the subject property. Unless otherwise expressly noted in the Report, no issues regarding the foregoing were brought to CBRE’s attention, and CBRE has no knowledge of any such facts affecting the subject property. If any information inconsistent with any of the foregoing assumptions is discovered, such information could have a substantial negative impact on the Report. Accordingly, if any such information is subsequently made known to CBRE, CBRE reserves the right to amend the Report, which may include the conclusions of the Report. CBRE assumes no responsibility for any conditions regarding the foregoing, or for any expertise or knowledge required to discover them. Any user of the Report is urged to retain an expert in the applicable field(s) for information regarding such conditions. 4. CBRE has assumed that all documents, data and information furnished by or behalf of the client, property owner, or owner’s representative are accurate and correct, unless otherwise expressly noted in the Report. Such data and information include, without limitation, numerical street addresses, lot and block numbers, Assessor’s Parcel Numbers, land dimensions, square footage area of the land, dimensions of the improvements, gross building areas, net rentable areas, usable areas, unit count, room count, rent schedules, income data, historical operating expenses, budgets, and related data. Any error in any of the above could have a substantial impact on the Report. Accordingly, if any such errors are subsequently made known to CBRE, CBRE reserves the right to amend the Report, which may include the conclusions of the Report. The client and intended user should carefully review all assumptions, data, relevant calculations, and conclusions of the Report and should immediately notify CBRE of any questions or errors within 30 days after the date of delivery of the Report. 5. CBRE assumes no responsibility (including any obligation to procure the same) for any documents, data or information not provided to CBRE, including without limitation any termite inspection, survey or occupancy permit. 6. All furnishings, equipment and business operations have been disregarded with only real property being considered in the Report, except as otherwise expressly stated and typically considered part of real property. 7. Any cash flows included in the analysis are forecasts of estimated future operating characteristics based upon the information and assumptions contained within the Report. Any projections of income, expenses and economic conditions utilized in the Report, including such cash flows, should be considered as only estimates of the expectations of future income and expenses as of the date of the Report and not predictions of the future. Actual results are affected by a number of factors outside the control of CBRE, including without limitation fluctuating economic, market, and property conditions. Actual results may ultimately differ from these projections, and CBRE does not warrant any such projections. 8. The Report contains professional opinions and is expressly not intended to serve as any warranty, assurance or guarantee of any particular value of the subject property. Other appraisers may reach different conclusions as to the value of the subject property. Furthermore, market value is highly related to exposure time, promotion effort, terms, motivation, and conclusions surrounding the offering of the subject property. The Report is for the sole purpose of providing the intended user with CBRE’s independent professional opinion of the value of the subject property as of the date of the Report. Accordingly, CBRE shall not be liable for any losses that arise from any investment or lending decisions based upon the Report that the client, intended user, or any buyer, seller, investor, or lending institution may undertake related to the subject property, and CBRE has not been compensated to assume any of these risks. Nothing contained in the Report shall be construed as any direct or indirect recommendation of CBRE to buy, sell, hold, or finance the subject property. 9. No opinion is expressed on matters which may require legal expertise or specialized investigation or knowledge beyond that customarily employed by real estate appraisers. Any user of the Report is advised to retain experts in areas that fall outside the scope of the real estate appraisal profession for such matters. 10. CBRE assumes no responsibility for any costs or consequences arising due to the need, or the lack of need, for flood hazard insurance. An agent for the Federal Flood Insurance Program should be contacted to determine the actual need for Flood Hazard Insurance. 11. Acceptance or use of the Report constitutes full acceptance of these Assumptions and Limiting Conditions and any special assumptions set forth in the Report. It is the responsibility of the user of the Report to read in full, comprehend and thus become aware of all such assumptions and limiting conditions. CBRE assumes no responsibility for any situation arising out of the user’s failure to become familiar with and understand the same. 12. The Report applies to the property as a whole only, and any pro ration or division of the title into fractional interests will invalidate such conclusions, unless the Report expressly assumes such pro ration or division of interests.

Assumptions and Limiting Conditions

13. The allocations of the total value estimate in the Report between land and improvements apply only to the existing use of the subject property. The allocations of values for each of the land and improvements are not intended to be used with any other property or appraisal and are not valid for any such use. 14. The maps, plats, sketches, graphs, photographs, and exhibits included in this Report are for illustration purposes only and shall be utilized only to assist in visualizing matters discussed in the Report. No such items shall be removed, reproduced, or used apart from the Report. 15. The Report shall not be duplicated or provided to any unintended users in whole or in part without the written consent of CBRE, which consent CBRE may withhold in its sole discretion. Exempt from this restriction is duplication for the internal use of the intended user and its attorneys, accountants, or advisors for the sole benefit of the intended user. Also exempt from this restriction is transmission of the Report pursuant to any requirement of any court, governmental authority, or regulatory agency having jurisdiction over the intended user, provided that the Report and its contents shall not be published, in whole or in part, in any public document without the written consent of CBRE, which consent CBRE may withhold in its sole discretion. Finally, the Report shall not be made available to the public or otherwise used in any offering of the property or any security, as defined by applicable law. Any unintended user who may possess the Report is advised that it shall not rely upon the Report or its conclusions and that it should rely on its own appraisers, advisors and other consultants for any decision in connection with the subject property. CBRE shall have no liability or responsibility to any such unintended user.

Addenda

ADDENDA

Addenda

Addendum A COMPARABLE DATA SHEETS

Sale Hotel - Extended Stay / Service No. 1

Property Name Residence Inn Riverside Address 12940 Day Street Moreno Valley, CA 92553 United States

Government Tax Agency Riverside Govt./Tax ID 291-650-028 Improvements Status Existing Land Area 2.370 ac Gross Building Area (GBA) 87,617 sf Floor Count N/A Year Built 2020 Year Renovated N/A Construction Type N/A Parking Type N/A Unique Physical Data Class Upscale # of Units 112 Room Standard Room Size N/A Affiliation Residence Inn (Marriott) Lounge Seats N/A Restaurant Seats N/A Amenities N/A Sale Summary Recorded Buyer Harvard Grand LP Marketing Time N/A True Buyer Dr. Ock Ja Won, Ock Won Buyer Type N/A Recorded Seller Kamla Hotels Seller Type N/A True Seller Kamla Hotels Primary Verification N/A

Interest Transferred Fee Simple/Freehold Type Sale Current Use N/A Date 3/5/2020 Proposed Use N/A Sale Price $26,250,000 Listing Broker Titan Hospitality - Steve Usher Financing N/A Selling Broker Susan Lee - Ocean's 5 Investment Inc. Cash Equivalent $26,250,000 Doc # N/A Capital Adjustment $0 Adjusted Price $26,250,000

Transaction Summary plus Five-Year CBRE View History Transaction Date Transaction Type Buyer Seller Price Cash Equivalent Price/sf 03/2020 Sale Harvard Grand LP Kamla Hotels $26,250,000 $299.60 Sale Hotel - Extended Stay / Service No. 1 Units of Comparison Static Analysis Method N/A Adjusted Price / sf $299.60 Buyer's Primary Analysis N/A Adjusted Price / Room $234,375 Net Initial Yield/Cap. Rate N/A Actual Occupancy at Sale N/A Financial

Pro Forma Revenue Type Stabilized Period Ending 3/5/2022 Source Broker Price $26,250,000 Economic Occupancy N/A ADR (Avg Daily Rate) N/A Room Revenue N/A Gross Revenue N/A Expenses N/A Net Operating Income $1,968,750 NOI / Room $17,578 NOI Ratio N/A GRM (Gross Rev Mult) N/A RRM (Room Rev Mult) N/A RevPAR N/A Net Initial Yield/Cap. Rate 7.50% Map & Comments The Residence Inn Riverside is located at 12940 Day Street in Moreno Valley. This 112-room extended stay hotel was constructed in March 2020, and sold several weeks prior to construction completion. Based on information provided by the broker, a 7.5% pro-forma capitalization rate was indicated, based on a stabilized (Year 2) pro-forma. The property sold in March 2020 for $26,250,000, or $234,375 per room. Sale/Allocated Price Hotel - Extended Stay / Service No. 2

Property Name Residence Inn Address 321 East Huntington Drive Arcadia, CA 91006 United States

Government Tax Agency Los Angeles Govt./Tax ID N/A Improvements Status Existing Land Area 3.480 ac Gross Building Area (GBA) 0 sf Floor Count 2 Year Built 1989 Year Renovated 2016 Construction Type N/A Parking Type Open Concrete Unique Physical Data Class N/A # of Units 120 Room Standard Room Size 0 sf Affiliation Residence Inns Lounge Seats 0 Restaurant Seats 0 Amenities Pool Sale Summary Recorded Buyer PI Properties No. 45 LLC Marketing Time 5 Month(s) True Buyer Positive Investments, Inc. Buyer Type Developer Recorded Seller BRE Newton Hotels Property Owner LP Seller Type Private Syndicator True Seller The Blackstone Group L.P. Primary Verification Broker

Interest Transferred Fee Simple/Freehold Type Sale/Allocated Price Current Use N/A Date 8/14/2019 Proposed Use N/A Sale Price $32,000,000 Listing Broker CBRE - Ron Danko Financing All Cash Selling Broker CBRE - Ron Danko Cash Equivalent $32,000,000 Doc # 0812634 Capital Adjustment $3,600,000 Adjusted Price $35,600,000

Transaction Summary plus Five-Year CBRE View History Transaction Date Transaction Type Buyer Seller Price Cash Equivalent Price/sf 08/2019 Sale/Allocated Price PI Properties No. 45 LLC BRE Newton Hotels $32,000,000 N/A Property Owner LP Sale/Allocated Price Hotel - Extended Stay / Service No. 2 Units of Comparison Static Analysis Method N/A Adjusted Price / sf N/A Buyer's Primary Analysis N/A Adjusted Price / Room $296,667 Net Initial Yield/Cap. Rate N/A Actual Occupancy at Sale 83% Financial

Pro Forma Trailing Revenue Type Stabilized Actuals Period Ending N/A N/A Source N/A N/A Price $35,600,000 $32,000,000 Economic Occupancy 83% 83% ADR (Avg Daily Rate) $192.78 $189.26 Room Revenue $7,008,324 $6,880,358 Gross Revenue $7,133,324 $7,007,335 Expenses $4,350,000 $4,248,752 Net Operating Income $2,783,324 $2,758,583 NOI / Room $23,194 $22,988 NOI Ratio 39.02 39.37 GRM (Gross Rev Mult) 4.99 4.57 RRM (Room Rev Mult) 5.08 4.65 RevPAR $160.01 $157.28 Net Initial Yield/Cap. Rate 7.82% 8.62% Map & Comments The sale is part of a portfolio three hotels totaling 462 rooms located in California. The Residence Inn Arcadia - Pasadena is comprised of 120 extended-stay all suites hotel that is located near the I-210 Freeway and Santa Anita Racetrack. Hotel amenities include an outdoor pool/spa, fitness room, sports court, outdoor patio and 400 SF of meeting space. It was in need of a $3.6 million PIP at the time of sale. Sale/Allocated Price Hotel - Extended Stay / Service No. 3

Property Name Residence Inn Long Beach Address 4111 East Willow Street Long Beach, CA 90815 United States

Government Tax Agency N/A Govt./Tax ID N/A Improvements Status Existing Land Area 5.110 ac Gross Building Area (GBA) N/A Floor Count 2 Year Built 1987 Year Renovated 2016 Construction Type N/A Parking Type Open Concrete Unique Physical Data Class N/A # of Units 216 Room Standard Room Size 0 sf Affiliation Residence Inns Lounge Seats 0 Restaurant Seats 0 Amenities Pool Sale Summary Recorded Buyer PI Properties No. 45 LLC Marketing Time 5 Month(s) True Buyer Positive Investments, Inc. Buyer Type Developer Recorded Seller BRE Newton Hotels Property Owner LP Seller Type Private Syndicator True Seller The Blackstone Group L.P. Primary Verification Broker

Interest Transferred Fee Simple/Freehold Type Sale/Allocated Price Current Use N/A Date 8/14/2019 Proposed Use N/A Sale Price $45,000,000 Listing Broker CBRE - Ron Danko Financing All Cash Selling Broker CBRE - Ron Danko Cash Equivalent $45,000,000 Doc # 0812634 Capital Adjustment $4,800,000 Adjusted Price $49,800,000

Transaction Summary plus Five-Year CBRE View History Transaction Date Transaction Type Buyer Seller Price Cash Equivalent Price/sf 08/2019 Sale/Allocated Price PI Properties No. 45 LLC BRE Newton Hotels $45,000,000 N/A Property Owner LP Sale/Allocated Price Hotel - Extended Stay / Service No. 3 Units of Comparison Static Analysis Method N/A Adjusted Price / sf N/A Buyer's Primary Analysis N/A Adjusted Price / Room $230,556 Net Initial Yield/Cap. Rate N/A Actual Occupancy at Sale 85% Financial

Pro Forma Trailing Revenue Type Stabilized Actuals Period Ending N/A N/A Source N/A N/A Price $49,800,000 $45,000,000 Economic Occupancy 85% 85% ADR (Avg Daily Rate) $160.00 $157.64 Room Revenue $10,722,240 $10,564,087 Gross Revenue $11,267,240 $11,109,129 Expenses $7,350,000 $7,269,338 Net Operating Income $3,917,240 $3,839,791 NOI / Room $18,135 $17,777 NOI Ratio 34.77 34.56 GRM (Gross Rev Mult) 4.42 4.05 RRM (Room Rev Mult) 4.64 4.26 RevPAR $136.00 $134.47 Net Initial Yield/Cap. Rate 7.87% 8.53% Map & Comments The sale is part of a portfolio three hotels totaling 462 rooms located in California. The Residence Inn Long Beach is comprised of 216 extended-stay all suites hotel that is located near the I-405 Freeway and Long Beach Airport. Hotel amenities include an outdoor pool/spa, fitness room, sports court, outdoor patio and 1,200 SF of meeting space. It was in need of a $3.6 million PIP at the time of sale. Sale Hotel - Extended Stay / Service No. 4

Property Name Residence Inn - Anaheim Hills Address 125 S Festival Drive Anaheim,, CA 92808 United States

Government Tax Agency Orange Govt./Tax ID 354-451-35 Improvements Status Existing Land Area 3.320 ac Gross Building Area (GBA) 93,707 sf Floor Count 4 Year Built 2002 Year Renovated 2018 Construction Type N/A Parking Type N/A Unique Physical Data Class N/A # of Units 128 Room Standard Room Size N/A Affiliation N/A Lounge Seats N/A Restaurant Seats N/A Amenities N/A Sale Summary Recorded Buyer Ponderosa Yorba Linda LLC Marketing Time N/A True Buyer Pacifica Hotel Company Buyer Type Developer Recorded Seller BRE APEX RI CA LLC Seller Type Private Investor True Seller The Blackstone Group L.P. Primary Verification Broker - (858) 812-2355

Interest Transferred N/A Type Sale Current Use N/A Date 1/17/2019 Proposed Use N/A Sale Price $25,500,000 Listing Broker JLL - (858) 812-2355 Financing Cash to Seller Selling Broker JLL - (858) 812-2355 Cash Equivalent $25,500,000 Doc # N/A Capital Adjustment $0 Adjusted Price $25,500,000

Transaction Summary plus Five-Year CBRE View History Transaction Date Transaction Type Buyer Seller Price Cash Equivalent Price/sf 01/2019 Sale Ponderosa Yorba Linda BRE APEX RI CA LLC $25,500,000 $272.12 LLC Sale Hotel - Extended Stay / Service No. 4 Units of Comparison Static Analysis Method Trailing Actuals Adjusted Price / sf $272.12 Buyer's Primary Analysis Yield Capitalization Analysis Adjusted Price / Room $199,219 Net Initial Yield/Cap. Rate 7.50% Actual Occupancy at Sale 80% Financial

Trailing Revenue Type Actuals Period Ending N/A Source N/A Price $25,500,000 Economic Occupancy 80% ADR (Avg Daily Rate) $139.32 Room Revenue $5,207,224 Gross Revenue N/A Expenses N/A Net Operating Income $1,912,500 NOI / Room $14,941 NOI Ratio N/A GRM (Gross Rev Mult) N/A RRM (Room Rev Mult) 4.90 RevPAR $111.46 Net Initial Yield/Cap. Rate 7.50% Map & Comments Residence Inn by Marriott Anaheim Hills Yorba Linda features 128 rooms and recently underwent a $3.5 million renovation, which consisted of a redesign of the lobby, breakfast room and event spaces.The hotel features a meeting room, complimentary breakfast, evening social event, outdoor terrace with built-in grill, outdoor swimming pool, fitness center and business center. The hotel is also adjacent to the 91 Freeway and Anaheim Hills Festival Shopping Center as well as being proximate to the Deer Canyon Park trails and the Chino Hills State Park in addition to other Orange County-area demand drivers, including Honda Center, Disneyland, Angel Stadium of Anaheim, Anaheim Convention Center and the Orange County Zoo. Sale Hotel - Full Service Hotel No. 5

Property Name Courtyard by Marriott Address 595 Hotel Circle South San Diego, CA 92108 United States

Government Tax Agency San Diego Govt./Tax ID 444-110-05-00 Improvements Status Existing Land Area 4.080 ac Gross Building Area (GBA) 110,000 sf Floor Count 10 Year Built 1974 Year Renovated 2015 Construction Type N/A Parking Type Surface Unique Physical Data Class N/A # of Units 317 Room Standard Room Size 0 sf Affiliation Marriott Lounge Seats N/A Restaurant Seats 100 Amenities Pool Sale Summary Recorded Buyer CWI Mission Valley Hotel LLC Marketing Time N/A True Buyer Carey Watermark Investors 1 Buyer Type Developer Recorded Seller NHV MV vi LLC Seller Type REIT True Seller Magna Hospitality Group Primary Verification Buyer

Interest Transferred Fee Simple/Freehold Type Sale Current Use N/A Date 9/26/2019 Proposed Use N/A Sale Price $79,000,000 Listing Broker N/A Financing Cash to Seller Selling Broker N/A Cash Equivalent $79,000,000 Doc # 0425490 Capital Adjustment $10,000,000 Adjusted Price $89,000,000

Transaction Summary plus Five-Year CBRE View History Transaction Date Transaction Type Buyer Seller Price Cash Equivalent Price/sf 09/2019 Sale CWI Mission Valley Hotel NHV MV vi LLC $79,000,000 $718.18 LLC Sale Hotel - Full Service Hotel No. 5 Units of Comparison Static Analysis Method N/A Adjusted Price / sf $809.09 Buyer's Primary Analysis N/A Adjusted Price / Room $280,757 Net Initial Yield/Cap. Rate N/A Actual Occupancy at Sale 85% Financial

Pro Forma Trailing Revenue Type Year 1 Actuals Period Ending N/A N/A Source N/A N/A Price $89,000,000 $79,000,000 Economic Occupancy 85% 85% ADR (Avg Daily Rate) $145.00 $141.13 Room Revenue $14,260,641 $13,880,030 Gross Revenue $17,260,641 $16,796,655 Expenses N/A N/A Net Operating Income $7,066,000 $7,065,364 NOI / Room $22,290 $22,288 NOI Ratio 40.94 42.06 GRM (Gross Rev Mult) 5.16 4.70 RRM (Room Rev Mult) 6.24 5.69 RevPAR $123.25 $119.96 Net Initial Yield/Cap. Rate 7.94% 8.94% Map & Comments This Courtyard hotel is located in the Mission Valley Area of San Diego near Interstate 8 and the Fashion Valley Mall. Hotel amenities include 8,800 square feet of meeting space, a limited-hour restaurant and bar, outdoor pool/spa, fitness room and business center.

The hotel completed $9 million common area renovation in 2018. The last rooms renovation was performed in 2015. The new owners plan to carry out a multimillion-dollar renovation of all guest rooms and the outdoor pool area after the purchase. Sale Hotel - Limited Service Hotel No. 6

Property Name Hampton Inn Address 2229 Palomar Airport Inn Carlsbad, CA 92011 United States

Government Tax Agency San Diego Govt./Tax ID N/A Improvements Status Existing Land Area 1.880 ac Gross Building Area (GBA) 48,810 sf Floor Count 3 Year Built 2007 Year Renovated N/A Construction Type N/A Parking Type Surface Unique Physical Data Class N/A # of Units 94 Room Standard Room Size 0 sf Affiliation N/A Lounge Seats 0 Restaurant Seats 0 Amenities Pool Sale Summary Recorded Buyer Alps Lodging 2 Inc Marketing Time N/A True Buyer ALPS Group, Inc. Buyer Type Private Investor Recorded Seller MG Hospitality Carlsbad LLC Seller Type Private Investor True Seller ALPS Group, Inc. Primary Verification Broker - (562) 865-6411

Interest Transferred Fee Simple/Freehold Type Sale Current Use N/A Date 8/31/2018 Proposed Use N/A Sale Price $22,750,000 Listing Broker Hospitality Unlimited - (562) 865-6411 Financing Cash to Seller Selling Broker Hospitality Unlimited - (562) 865-6411 Cash Equivalent $22,750,000 Doc # 0362652 Capital Adjustment $0 Adjusted Price $22,750,000

Transaction Summary plus Five-Year CBRE View History Transaction Date Transaction Type Buyer Seller Price Cash Equivalent Price/sf 08/2018 Sale Alps Lodging 2 Inc MG Hospitality Carlsbad $22,750,000 $466.09 LLC Sale Hotel - Limited Service Hotel No. 6 Units of Comparison Static Analysis Method N/A Adjusted Price / sf $466.09 Buyer's Primary Analysis N/A Adjusted Price / Room $242,021 Net Initial Yield/Cap. Rate N/A Actual Occupancy at Sale 91% Financial

Pro Forma Revenue Type Stabilized Period Ending N/A Source N/A Price $22,750,000 Economic Occupancy 90% ADR (Avg Daily Rate) $139.00 Room Revenue $4,292,181 Gross Revenue $4,378,581 Expenses N/A Net Operating Income $1,644,000 NOI / Room $17,489 NOI Ratio 37.55 GRM (Gross Rev Mult) 5.20 RRM (Room Rev Mult) 5.30 RevPAR $125.10 Net Initial Yield/Cap. Rate 7.23% Map & Comments This comparable is of the Hampton Inn - a Limited Service Hotel with 94-rooms located at 2229 Palomar Airport Inn, Carlsbad, CA. The improvements were constructed in 2007. The transaction occurred in August, 2018 for $22,750,000, or $242,021 per room. Occupancy at the time of sale was 91%. The hotel is located in the Palomar Airport Business Park area of Carlsbad, San Diego County. Hotel amenities include a breakfast room, 600 square feet of meeting space, outdoor pool/spa, business center and fitness room. The hotel has not had any significant renovations since 2007. Sale Hotel - Limited Service Hotel No. 7

Property Name West Inn & Suites Carlsbad Address 4970 Avenida Encinas Carlsbad, CA 92008 United States

Government Tax Agency San Diego Govt./Tax ID 210-011-04 Improvements Status Existing Land Area 1.450 ac Gross Building Area (GBA) 65,802 sf Floor Count 3 Year Built 2006 Year Renovated N/A Construction Type N/A Parking Type Open Asphalt Unique Physical Data Class N/A # of Units 86 Room Standard Room Size N/A Affiliation N/A Lounge Seats N/A Restaurant Seats N/A Amenities N/A Sale Summary Recorded Buyer Pacifica Avenida Encinas LP Marketing Time 4 Month(s) True Buyer Pacifica Companies Buyer Type Private Investor Recorded Seller West Real Estates LLC Seller Type Developer True Seller West Development, Inc. Primary Verification Broker - (760) 444-2920

Interest Transferred Fee Simple/Freehold Type Sale Current Use N/A Date 5/21/2018 Proposed Use N/A Sale Price $19,500,000 Listing Broker CBRE - (760) 444-2920 Financing Cash to Seller Selling Broker N/A Cash Equivalent $19,500,000 Doc # 0204463 Capital Adjustment $0 Adjusted Price $19,500,000

Transaction Summary plus Five-Year CBRE View History Transaction Date Transaction Type Buyer Seller Price Cash Equivalent Price/sf 05/2018 Sale Pacifica Avenida Encinas West Real Estates LLC $19,500,000 $296.34 LP Sale Hotel - Limited Service Hotel No. 7 Units of Comparison Static Analysis Method N/A Adjusted Price / sf $296.34 Buyer's Primary Analysis N/A Adjusted Price / Room $226,744 Net Initial Yield/Cap. Rate N/A Actual Occupancy at Sale 75% Financial

Pro Forma Revenue Type Year 1 Period Ending N/A Source N/A Price $19,500,000 Economic Occupancy 77% ADR (Avg Daily Rate) $174.16 Room Revenue $4,209,499 Gross Revenue $4,609,499 Expenses $3,192,000 Net Operating Income $1,417,499 NOI / Room $16,483 NOI Ratio 30.75 GRM (Gross Rev Mult) 4.23 RRM (Room Rev Mult) 4.63 RevPAR $134.10 Net Initial Yield/Cap. Rate 7.27% Map & Comments Opened in May 2006, the West Inn & Suites is an 86-room, limited service hotel featuring 36 suites, a fitness center, heated outdoor pool and whirlpool, state-of-the-art boardroom, library and breakfast area. The property also features a full breakfast buffet, shuttle service and subterranean parking. Though this sale is for the hotel-only, it should be noted that the hotel enjoys the benefits by being adjacent to a 7,800 square foot Bistro Restaurant (currently closed) and a gas station. Located just off Interstate-5 at Cannon Road and only three blocks from the Carlsbad beach on the Pacific Ocean, Palomar Corporate Center, the Palomar Airport as well as the local leisure attractions including its very close-proximity to LEGOLAND. Currently owner managed, there exists a significant opportunity to improve operations through a change in ownership and management company. This is high-quality hotel that is unencumbered by brand and management with non-union labor. The property sold on May 21, 2018 for $19,500,000, or $226,744.19/unit. Sale Hotel - Limited Service Hotel No. 8

Property Name Homewood Suites by Hilton Address 2223 Palomar Airport Road Carlsbad, CA 92008 United States

Government Tax Agency San Diego Govt./Tax ID 213-070-29 Improvements Status Existing Land Area 2.640 ac Gross Building Area (GBA) 102,000 sf Floor Count 3 Year Built 2008 Year Renovated N/A Construction Type N/A Parking Type N/A Unique Physical Data Class N/A # of Units 145 Room Standard Room Size 0 sf Affiliation Hilton Lounge Seats 0 Restaurant Seats 0 Amenities Pool Sale Summary Recorded Buyer Brighton Palomar Hotel, LLC Marketing Time N/A True Buyer Brighton Management Buyer Type N/A Recorded Seller Chatham Carlsbad HS, LLC Seller Type REIT True Seller Chatham Lodging Trust Primary Verification David Wei, buyer (949) 390-6888

Interest Transferred Fee Simple/Freehold Type Sale Current Use N/A Date 12/20/2017 Proposed Use N/A Sale Price $33,000,000 Listing Broker N/A Financing Cash to Seller Selling Broker N/A Cash Equivalent $33,000,000 Doc # N/A Capital Adjustment $0 Adjusted Price $33,000,000

Transaction Summary plus Five-Year CBRE View History Transaction Date Transaction Type Buyer Seller Price Cash Equivalent Price/sf 12/2017 Sale Brighton Palomar Hotel, Chatham Carlsbad HS, $33,000,000 $323.53 LLC LLC Sale Hotel - Limited Service Hotel No. 8 Units of Comparison Static Analysis Method Trailing Actuals Adjusted Price / sf $323.53 Buyer's Primary Analysis Static and Yield Capitalization Analyses Adjusted Price / Room $227,586 Net Initial Yield/Cap. Rate 7.04% Actual Occupancy at Sale 88% Financial

Pro Forma Trailing Revenue Type Year 1 Actuals Period Ending N/A 12/31/2017 Source N/A Buyer Price $33,000,000 $33,000,000 Economic Occupancy 88% 88% ADR (Avg Daily Rate) $155.00 $150.60 Room Revenue $7,218,970 $7,014,044 Gross Revenue $7,347,720 $7,139,044 Expenses $4,950,000 $4,816,376 Net Operating Income $2,397,720 $2,322,668 NOI / Room $16,536 $16,018 NOI Ratio 32.63 32.53 GRM (Gross Rev Mult) 4.49 4.62 RRM (Room Rev Mult) 4.57 4.70 RevPAR $136.40 $132.53 Net Initial Yield/Cap. Rate 7.27% 7.04% Map & Comments On December 21, 2017, Chatham Lodging Trust completed the sale of the 145-suite Homewood Suites by Hilton Carlsbad, Calif., for $33 million, or approximately $228,000 per suite. Chatham sold the hotel at an approximate 6.5 percent net operating income capitalization rate (after an assumed annual capital reserve of 4.0 percent of total hotel revenues) based on trailing 12 months performance. The property was acquired by Brighton Management, LLC. In connection with the sale, the buyer assumed a $20 million CMBS loan that carried an interest rate of 4.3 percent. Remaining proceeds of $13 million will be utilized to reduce borrowings on Chatham·s unsecured credit facility. Property amenities include 1,550 square feet of meeting space, outdoor pool/spa, business center and fitness room. The hotel was renovated in 2015. Addenda

Addendum B SUBJECT PROPERTY DATA

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!"#$ %$#%&$ '()0 1#2%34#56 7869@A@B CDÿEF29Gÿ736ÿ@H$%IH# )0BEP ÿ ÿ

!"#$ %$#%&$ '()0 1#2%34#56 7869@A@B CDÿEF29Gÿ736ÿ@H$%IH# )0BEP Site 04 NBU No. 21120195 Local No. 0022323 Issued 04/21/2011

CHICAGO TITLE INSURANCE COMPANY COMMITMENT FOR TITLE INSURANCE

SCHEDULE A

1. The effective date of this Commitment is:

April 12, 2011 at 7:30 am

2. The proposed form of policy (or policies) to be issued is:

ALTA Owner’s (REV. 06/17/06)

ALTA Loan (REV. 06/17/06)

3. The proposed insured value of the policy (or policies) to be issued is:

Owner’s: To Be Determined

Loan: To Be Determined

4. The proposed insured for the policy (or policies) is:

Owner’s: To Be Determined

Loan: To Be Determined

5. The estate or interest in the land described or referred to in the Commitment and covered herein is:

A Fee

6. Title to said estate or interest at the date hereof is vested in:

KPA RIMV LLC, a Delaware limited liability company

7. The land referred to in this Commitment is described as follows:

(See “Exhibit ‘A’” attached)

Site 04 NBU No. 21120195 Local No. 0022323 Issued 04/21/2011 EXHIBIT “A” LEGAL DESCRIPTION

PARCEL 2 IN THE CITY OF SAN DIEGO, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, AS SHOWN AT PAGE 18040 OF PARCEL MAPS, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, JUNE 4, 1998.

APN: 443-040-39

END OF LEGAL DESCRIPTION

Site 04 NBU No. 21120195 Local No. 0022323 Issued 04/21/2011 SCHEDULE B

At the date hereof, items to be considered and exceptions to coverage in addition to the printed Exceptions and Exclusions in said policy form would be as follows:

1. Property taxes, including any assessments collected with taxes, for the fiscal year 2011 - 2012 that are a lien not yet due.

2. Said property has been declared tax-defaulted for non-payment of delinquent taxes for fiscal year 2009 - 2010 (and subsequent years, if any)

Amount To Redeem: $733,221.90 If Paid By: $April 30, 2011

Amount To Redeem: $742,020.26 If Paid By: $May 31, 2011

3. The lien of supplemental taxes, if any, assessed pursuant to the provisions of Chapter 3.5 (commencing with Section 75) of the revenue and taxation code of the State of California

4. Water rights, claims or title to water, whether or not shown by the public records.

5. An easement for the purpose shown below and rights incidental thereto as set forth in a document.

Granted To: City of San Diego Purpose: For a line of sewer and incidental purposes Recorded: September 13, 1921 in Book 861, Page 208 of Deeds Affects: The route thereof affects a portion of said land and is more fully described in said document.

6. An easement for the purpose shown below and rights incidental thereto as set forth in a document.

Granted To: City of San Diego Purpose: For a sewer line and incidental purposes Recorded: September 22, 1921 in Book 863, Page 163, Official records Affects: The route thereof affects a portion of said land and is more fully described in said document.

7. An easement for the purpose shown below and rights incidental thereto as set forth in a document.

Granted To: City of San Diego Purpose: For a public sewer or sewers, a storm drain or drains and incidental purposes Recorded: August 27, 1971 as Instrument No. 194355, Official records Site 04 NBU No. 21120195 Local No. 0022323 Issued 04/21/2011 Affects: The route thereof affects a portion of said land and is more fully described in said document.

8. An easement for the purpose shown below and rights incidental thereto as set forth in a document.

Granted To: Mission Cable TV, Inc. Purpose: Serial and underground community antenna and incidental purposes Recorded: December 27, 1980 as Instrument No. 80-357046, Official records Affects: The exact location and extent of said easement is not disclosed of record

9. Planning Commission Resolution No. 0630-P.C., granting Planned Commercial Development Permit No. 88-0948 recorded March 7, 1990 as Instrument No. 90-0122276, Official records.

10. An easement for the purpose shown below and rights incidental thereto as shown or as offered for dedication on the recorded Map shown below.

Map: Parcel Map 18040 Purpose: Open Space Affects: As shown on said Map

11. An easement for the purpose shown below and rights incidental thereto as shown or as offered for dedication on the recorded Map shown below.

Map: Parcel Map 18040 Purpose: Future Street Affects: As shown on said Map

12. The terms and provisions contained in the document entitled “Mission Valley Planned District/Resource Protection Ordinance Permit No. 96-7234 Meravilla II (La Quinta Inn) City Council” recorded May 11, 2001 as Instrument No. 2001-0299740, Official records.

13. A document entitled “Property Grading Agreement”, dated, September 5, 2001, executed by Hotel Circle Partners, LLC, a California limited liability company, subject to all the terms, provisions and conditions therein contained, recorded September 24, 2001 as Instrument No. 2001- 0684352, Official records.

14. A document entitled “Encroachment Maintenance and Removal Agreement”, dated, October 23, 2001, executed by the City of San Diego and Hotel Circle Partners, LLC, subject to all the terms, provisions and conditions therein contained, recorded November 8, 2001 as Instrument No. 2001-0816551, of Official Records.

15. An easement for the purpose shown below and rights incidental thereto as set forth in a document.

Granted To: San Diego Gas and Electric Company Purpose: public utilities, ingress, egress Site 04 NBU No. 21120195 Local No. 0022323 Issued 04/21/2011 Recorded: September 16, 2002 as Instrument No. 2002-0789032, of Official Records Affects: The route thereof affects a portion of said land and is more fully described in said document.

Restrictions on the use, by the owners of said land, of the easement area as set out in the easement document shown hereinabove.

16. An irrevocable offer to dedicate a portion of said land for the purposes stated herein.

In Favor Of: City of San Diego For: Street and highway purposes and incidents and appurtenances thereto Recorded: February 9, 2004 as Instrument No. 2004-0101934, Official records Affects: As shown in said document

17. A document entitled “Joint Use Agreement”, dated, March 13, 2003, executed by Coxcom, Inc.., a Delaware corporation d/b/a Cox Communications San Diego and the City of San Diego, a municipal corporation, subject to all the terms, provisions and conditions therein contained, recorded February 9, 2004 as Instrument No. 2004-0101982, Official records.

18. An easement for the purpose shown below and rights incidental thereto as set forth in a document.

Granted To: City of San Diego Purpose: To construct, reconstruct, maintain, operate and repair of water facilities, including any and all appurtenances, together with the right of ingress and egress Recorded: February 9, 2004 as Instrument No. 2004-0102027, of Official Records Affects: The route thereof affects a portion of said land and is more fully described in said document.

19. An easement for the purpose shown below and rights incidental thereto as set forth in a document.

Granted To: City of San Diego, a municipal corporation Purpose: To construct, reconstruct, maintain, operate and repair of water facilities, including any and all appurtenances thereto, together with the right of ingress and egress Recorded: February 9, 2004 as Instrument No. 2004-0102056, of Official Records Affects: The route thereof affects a portion of said land and is more fully described in said document.

20. An easement for the purpose shown below and rights incidental thereto as shown or as offered for dedication on the recorded Map shown below.

Map: Parcel Map 18040 Purpose: Drainage Site 04 NBU No. 21120195 Local No. 0022323 Issued 04/21/2011 Affects: As shown on said Map

A Certified Resolution No. R-299425 for Vacating Drainage Easement as Depicted on Map No. 18040, recorded July 22, 2004 as Instrument No. 2004-686328, Official records.

21. Any rights, interests, or claims which may exist or arise by reason of the following facts shown on a Survey Plat entitled “ALTA/ACSM Land Title Survey” dated July 11, 2006 last revised September 11, 2006 prepared by JRN Civil Engineers.

a) The fact that are chain link fences, concrete gutters, sewer lines, above ground drain pipes, “Fire Service” and block walls encroaching onto or from the exterior boundary line of said land.

b) Concrete gutters, chain link fences, electric pull boxes, water valves, water meters, fire hydrants, fire service connections, fire service valves, sewer cleanouts, electric transformers, catch basins and manholes which exist on said land

c) Block walls (southwest corner and south side) encroach 9.4’ southwesterly and 4.6’ southerly of the property line onto the subject property.

d) A wood fence encroaches 1.5’ westerly of the property line onto the subject property

22. A document entitled “Notice Of Consent To Use Land”, dated, July 11, 2005, executed by RLJ San Diego-Mission Valley Hotel LP, subject to all the terms, provisions and conditions therein contained, recorded July 18, 2005 as Instrument No. 2005-0602992, Official records.

23. A Deed of Trust to secure an indebtedness in the original amount shown below.

Amount: $47,400,000.00 Dated: October 4, 2006 Trustor: KPA RIMV LLC, a Delaware limited liability company Trustee: Chicago Title Insurance Company Beneficiary: Capmark Bank, a Utah Industrial Bank Loan Number: Not shown Recorded: October 5, 2006 as Instrument No. 2006-0710848 of Official Records

An assignment of the beneficial interest under said Deed of Trust which names:

As Assignee: Wells Fargo Bank, N. A., as trustee for the registered Holders of Credit Suisse First Boston Mortgage Securities Corp., Commercial Mortgage Pass-Through Certificates, Series 2007-C1 Recorded: June 29, 2007 as Instrument No. 2007-0439436 of Official Records

Site 04 NBU No. 21120195 Local No. 0022323 Issued 04/21/2011 The terms and provisions contained in the document entitled “Loan Assumption, Affirmation and Modification Agreement” recorded August 15, 2007 as Instrument No. 2007-0544833 of Official Records.

24. Rights of KPA RIMV Lessee LLC, a Delaware limited liability company, as tenant under an unrecorded lease from KPA RIMV LLC, a Delaware limited liability company, dated as of October 4, 2006.

25. Assignment of Leases, Rent and Profits from KPA RIMV Lessee LLC, a Delaware limited liability company to KPA RIMV LLC, a Delaware limited liability company Filed October 5, 2006 as file no. 2006-0710849 of Official records San Diego County

An assignment of assignment of leases and rents:

The terms and provisions contained in the document entitled “Loan Assumption, Affirmation and Modification Agreement” recorded August 15, 2007 as Instrument No. 2007-0544833 of Official Records.

26. Assignment of Assignment of Leases, Rents and Profits from KPA RIMV LLC, a Delaware limited liability company to Capmark Bank, a Utah Industrial Bank filed October 5, 2006 as file no. 2006- 0710850 of Official Records San Diego County

An assignment of assignment of leases and rents:

The terms and provisions contained in the document entitled “Loan Assumption, Affirmation and Modification Agreement” recorded August 15, 2007 as Instrument No. 2007-0544833 of Official Records.

27. UCC-1 Financing Statement filed from KPA RIMV Lessee LLC, a Delaware limited liability company and KPA RIMV LLC, a Delaware limited liability company to Capmark Bank, a Utah Industrial Bank filed October 5, 2006 as file no. 2006-0710851 of Official Records San Diego County.

A change to the above Financing Statement was filed

Nature of Change: Assignment Recorded: May 30, 2007 as Instrument No. 2007-0363851 of Official Records Site 04 NBU No. 21120195 Local No. 0022323 Issued 04/21/2011

The terms and provisions contained in the document entitled “Loan Assumption, Affirmation and Modification Agreement” recorded August 15, 2007 as Instrument No. 2007-0544833 of Official Records.

28. UCC-1 Financing Statement filed from KPA RIMV Lessee LLC, a Delaware limited liability company and KPA RIMV LLC, a Delaware limited liability company to Capmark Bank, a Utah Industrial Bank filed October 5, 2006 as file no. 2006-0710852 of Official records San Diego County.

A change to the above Financing Statement was filed

Nature of Change: Assignment Recorded: May 30, 2007 as Instrument No. 2007-0363853 of Official Records

The terms and provisions contained in the document entitled “Loan Assumption, Affirmation and Modification Agreement” recorded August 15, 2007 as Instrument No. 2007-0544833 of Official Records.

29. Matters which may be disclosed by an inspection and/or by a correct ALTA/ACSM Land Title Survey of said land that is satisfactory to this Company, and/or by inquiry of the parties in possession thereof.

This office must be notified at least 7 business days prior to the scheduled closing in order to arrange for an inspection of the land; upon completion of this inspection you will be notified of the removal of specific coverage exceptions and/or additional exceptions to coverage.

30. Any rights of parties in possession of said land, based on any unrecorded lease, or leases.

This Company will require a full copy of any unrecorded lease, together with all supplements, assignments, and amendments for review.

END OF SCHEDULE B

Eric Kentoff Vice President and Secretary Addenda

Addendum C SMITH TRAVEL RESEARCH REPORT

STR # 45777 / Created January 17, 2020 Monthly STAR Report : Residence Inn San Diego Mission Valley For the Month of: December 2019 Currency: US Dollar / Competitive Set Data Excludes Subject Property

Table Of Contents 1 Monthly Performance at a Glance 2 STAR Summary 3 Competitive Set Report 4 Response Report 5 Day of Week & Weekday/Weekend 6 Daily Data for the Month 7 Segmentation at a Glance 8 Segmentation Occupancy Analysis 9 Segmentation ADR Analysis 10 Segmentation RevPAR Analysis 11 Segmentation Index Analysis 12 Segmentation Ranking Analysis 13 Segmentation Day Of Week - Current Month 14 Segmentation Day Of Week - Year to Date 15 Segmentation Day Of Week - Running 3 Month 16 Segmentation Day Of Week - Running 12 Month 17 Additional Revenue ADR Analysis (TrevPOR) 18 Additional Revenue RevPAR Analysis (TrevPAR) 19 Segmentation Response Report 20 Help 21

735 East Main Street, Hendersonville, TN 37075 USA Blue Fin Building, 110 Southwark Street, London SE1 0TA T : +1 615 824 8664 T : +44 (0)20 7922 1930 [email protected] www.str.com [email protected] www.str.com

Residence Inn San Diego Mission Valley 1865 Hotel Cir S San Diego, CA 92108-3319 Phone: (619) 881-3600 STR # 45777 ChainID: SANHC MgtCo: Island Hospitality Management Owner: Chatham Lodging Trust For the Month of: December 2019 Date Created: January 17, 2020 Monthly Competitive Set Data Excludes Subject Property

December 2019

Occupancy (%) ADR RevPAR

My Prop Comp Set Index (MPI) My Prop Comp Set Index (ARI) My Prop Comp Set Index (RGI)

Current Month 50.0 66.9 74.8 138.39 110.13 125.7 69.24 73.70 93.9

Year To Date 85.3 81.8 104.2 174.69 142.82 122.3 148.94 116.84 127.5

Running 3 Month 70.8 74.3 95.3 151.81 122.12 124.3 107.55 90.75 118.5

Running 12 Month 85.3 81.8 104.2 174.69 142.82 122.3 148.94 116.84 127.5

December 2019 vs. 2018 Percent Change (%)

Occupancy ADR RevPAR

My Prop Comp Set Index (MPI) My Prop Comp Set Index (ARI) My Prop Comp Set Index (RGI)

Current Month -36.6 -8.4 -30.8 -16.5 -13.5 -3.4 -47.1 -20.8 -33.1

Year To Date -0.5 -5.1 4.9 2.0 -0.3 2.3 1.5 -5.4 7.3

Running 3 Month -19.7 -6.5 -14.1 -10.3 -10.3 0.0 -28.0 -16.1 -14.2

Running 12 Month -0.5 -5.1 4.9 2.0 -0.3 2.3 1.5 -5.4 7.3

The STR STAR Report is a publication of STR, Inc. and STR Global, Ltd., and is intended solely for use by paid subscribers. Reproduction or distribution of the STR STAR Report, in whole or part, without written permission is prohibited and subject to legal action. If you have received this report and are NOT a subscriber to the STR STAR Report, please contact us immediately. Source: 2020 STR, Inc. / STR Global, Ltd. trading as “STR”. Tab 3 - STAR Summary - My Property vs. Comp Set and Industry Segments Residence Inn San Diego Mission Valley 1865 Hotel Cir S San Diego, CA 92108-3319 Phone: (619) 881-3600 STR # 45777 ChainID: SANHC MgtCo: Island Hospitality Management Owner: Chatham Lodging Trust For the Month of: December 2019 Date Created: January 17, 2020 Monthly Competitive Set Data Excludes Subject Property Occupancy (%) Supply

Current Running 3 Running 12 Month % Run 3 Mon % Run 12 Mon % Chg Year to Date % Chg % Chg % Chg YTD % Chg Month Month Month Chg Chg % Chg

Residence Inn San Diego Mission Valley 50.0 -36.6 85.3 -0.5 70.8 -19.7 85.3 -0.5 3.2 0.3 1.1 0.3

Market: San Diego, CA 62.7 -6.3 76.7 -2.3 69.9 -4.2 76.7 -2.3 2.8 2.5 2.9 2.5

Market Class: Upscale Class 64.3 -8.2 79.5 -2.0 71.8 -5.6 79.5 -2.0 3.8 2.7 3.5 2.7

Submarket: Mission Valley, CA 62.2 -10.9 78.4 -3.1 69.6 -7.9 78.4 -3.1 -0.4 -2.0 -0.4 -2.0

Submarket Scale: Upscale Chains 65.8 -13.1 83.7 -0.5 74.7 -7.4 83.7 -0.5 0.0 -4.8 0.0 -4.8

Competitive Set: Competitors 66.9 -8.4 81.8 -5.1 74.3 -6.5 81.8 -5.1 0.0 0.0 0.0 0.0

Average Daily Rate Demand

Current Running 3 Running 12 Month % Run 3 Mon % Run 12 Mon % Chg Year to Date % Chg % Chg % Chg YTD % Chg Month Month Month Chg Chg % Chg

Residence Inn San Diego Mission Valley 138.39 -16.5 174.69 2.0 151.81 -10.3 174.69 2.0 -34.6 -0.2 -18.8 -0.2

Market: San Diego, CA 135.50 -5.4 166.78 0.2 148.65 -4.5 166.78 0.2 -3.7 0.1 -1.5 0.1

Market Class: Upscale Class 129.80 -5.9 156.77 0.0 139.16 -5.8 156.77 0.0 -4.7 0.6 -2.3 0.6

Submarket: Mission Valley, CA 93.83 -15.3 124.56 -1.8 104.24 -12.4 124.56 -1.8 -11.3 -5.0 -8.3 -5.0

Submarket Scale: Upscale Chains 115.44 -14.0 151.78 -0.5 129.91 -11.0 151.78 -0.5 -13.1 -5.2 -7.4 -5.2

Competitive Set: Competitors 110.13 -13.5 142.82 -0.3 122.12 -10.3 142.82 -0.3 -8.4 -5.1 -6.5 -5.1

RevPAR Revenue

Current Running 3 Running 12 Month % Run 3 Mon % Run 12 Mon % Chg Year to Date % Chg % Chg % Chg YTD % Chg Month Month Month Chg Chg % Chg

Residence Inn San Diego Mission Valley 69.24 -47.1 148.94 1.5 107.55 -28.0 148.94 1.5 -45.3 1.8 -27.2 1.8

Market: San Diego, CA 85.01 -11.4 127.95 -2.1 103.85 -8.5 127.95 -2.1 -8.9 0.3 -5.9 0.3

Market Class: Upscale Class 83.51 -13.6 124.63 -2.1 99.91 -11.1 124.63 -2.1 -10.3 0.6 -8.0 0.6

Submarket: Mission Valley, CA 58.36 -24.5 97.69 -4.8 72.56 -19.4 97.69 -4.8 -24.9 -6.6 -19.7 -6.6

Submarket Scale: Upscale Chains 75.94 -25.3 126.97 -1.0 97.09 -17.6 126.97 -1.0 -25.3 -5.7 -17.6 -5.7

Competitive Set: Competitors 73.70 -20.8 116.84 -5.4 90.75 -16.1 116.84 -5.4 -20.8 -5.4 -16.1 -5.4

Census/Sample - Properties & Rooms Pipeline

Census Sample Sample % Market: San Diego, CA

Properties Rooms Properties Rooms Rooms Under Construction Planning

Market: San Diego, CA 497 63905 347 55072 86.2 Properties Rooms Properties Rooms Market Class: Upscale Class 86 13606 72 12263 90.1 10 1334 32 5836 Submarket: Mission Valley, CA 33 6646 31 6435 96.8 Submarket Scale: Upscale Chains 11 2910 11 2910 100.0 See Help page for pipeline definitions. Competitive Set: Competitors 6 1011 6 1011 100.0

90 -23

80 -28

70 -33 Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Year to Date Running 3 Month Running 12 Month Occupancy Index (MPI) ADR Index (ARI) RevPAR Index (RGI) 100 % My Property Competitive Set

2018 2019 Year To Date Running 3 Month Running 12 Month Occupancy (%) Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2017 2018 2019 2017 2018 2019 2017 2018 2019

My Property 97.6 96.6 85.8 93.2 92.7 78.9 83.1 90.9 93.2 88.1 84.4 93.2 97.1 94.7 86.7 77.4 86.3 50.0 85.5 85.7 85.3 74.1 88.2 70.8 85.5 85.7 85.3

Competitive Set 92.2 90.3 85.8 85.4 79.9 73.1 79.3 80.9 86.6 85.3 77.7 90.5 89.5 86.8 82.3 77.4 78.7 66.9 84.9 86.2 81.8 81.0 79.4 74.3 84.9 86.2 81.8

Index (MPI) 105.9 106.9 100.0 109.1 116.0 108.0 104.8 112.4 107.6 103.3 108.5 103.0 108.6 109.2 105.4 99.9 109.6 74.8 100.7 99.4 104.2 91.5 111.0 95.3 100.7 99.4 104.2

Rank 2 of 7 2 of 7 5 of 7 2 of 7 1 of 7 4 of 7 4 of 7 2 of 7 2 of 7 3 of 7 2 of 7 4 of 7 2 of 7 3 of 7 4 of 7 4 of 7 3 of 7 7 of 7 5 of 7 5 of 7 4 of 7 6 of 7 2 of 7 5 of 7 5 of 7 5 of 7 4 of 7 % Chg

My Property 2.8 3.3 -4.5 5.1 30.6 26.0 53.1 11.6 8.1 12.5 -3.4 -2.3 -0.4 -1.9 1.1 -17.0 -6.9 -36.6 -4.0 0.2 -0.5 -9.6 19.0 -19.7 -4.0 0.2 -0.5

Competitive Set -2.9 1.8 7.5 3.0 -1.8 -7.3 4.5 -9.1 -7.9 -4.7 -9.5 -3.4 -2.9 -4.0 -4.1 -9.3 -1.4 -8.4 0.6 1.5 -5.1 5.3 -2.0 -6.5 0.6 1.5 -5.1

Index (MPI) 5.9 1.4 -11.2 2.0 33.1 35.9 46.5 22.8 17.4 18.1 6.7 1.2 2.5 2.1 5.4 -8.4 -5.5 -30.8 -4.6 -1.3 4.9 -14.1 21.4 -14.1 -4.6 -1.3 4.9

Rank 3 of 7 2 of 7 7 of 7 3 of 7 1 of 7 1 of 7 1 of 7 1 of 7 1 of 7 1 of 7 1 of 7 6 of 7 3 of 7 4 of 7 2 of 7 6 of 7 6 of 7 7 of 7 7 of 7 5 of 7 2 of 7 7 of 7 1 of 7 7 of 7 7 of 7 5 of 7 2 of 7

2018 2019 Year To Date Running 3 Month Running 12 Month ADR Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2017 2018 2019 2017 2018 2019 2017 2018 2019

My Property 207.16 172.72 159.84 169.99 171.72 165.72 168.66 177.99 178.39 171.89 169.01 196.72 212.53 179.22 167.22 160.64 151.92 138.39 174.55 171.31 174.69 152.88 169.30 151.81 174.55 171.31 174.69

Competitive Set 181.75 151.75 137.19 140.13 140.13 127.35 132.36 143.87 141.75 141.90 143.01 164.14 180.59 150.02 137.74 129.02 125.63 110.13 138.93 143.25 142.82 121.87 136.17 122.12 138.93 143.25 142.82

Index (ARI) 114.0 113.8 116.5 121.3 122.5 130.1 127.4 123.7 125.9 121.1 118.2 119.8 117.7 119.5 121.4 124.5 120.9 125.7 125.6 119.6 122.3 125.4 124.3 124.3 125.6 119.6 122.3

Rank 4 of 7 3 of 7 2 of 7 1 of 7 1 of 7 1 of 7 2 of 7 1 of 7 1 of 7 3 of 7 3 of 7 2 of 7 2 of 7 2 of 7 1 of 7 2 of 7 2 of 7 2 of 7 1 of 7 2 of 7 1 of 7 2 of 7 1 of 7 2 of 7 1 of 7 2 of 7 1 of 7 % Chg

My Property -3.1 -6.8 -3.1 4.5 14.7 16.4 19.0 9.1 4.9 3.3 3.6 6.5 2.6 3.8 4.6 -5.5 -11.5 -16.5 2.1 -1.9 2.0 -7.5 10.7 -10.3 2.1 -1.9 2.0

Competitive Set 3.5 1.4 0.2 5.4 13.0 17.9 10.4 5.9 2.2 3.8 1.4 3.3 -0.6 -1.1 0.4 -7.9 -10.3 -13.5 -0.3 3.1 -0.3 -7.6 11.7 -10.3 -0.3 3.1 -0.3

Index (ARI) -6.4 -8.1 -3.3 -0.9 1.5 -1.2 7.9 3.0 2.6 -0.5 2.2 3.0 3.2 5.0 4.2 2.6 -1.3 -3.4 2.4 -4.8 2.3 0.1 -0.9 0.0 2.4 -4.8 2.3

Rank 7 of 7 7 of 7 7 of 7 6 of 7 4 of 7 4 of 7 1 of 7 2 of 7 1 of 7 5 of 7 2 of 7 3 of 7 2 of 7 1 of 7 1 of 7 3 of 7 4 of 7 6 of 7 2 of 7 7 of 7 1 of 7 4 of 7 5 of 7 3 of 7 2 of 7 7 of 7 1 of 7

2018 2019 Year To Date Running 3 Month Running 12 Month RevPAR Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2017 2018 2019 2017 2018 2019 2017 2018 2019

My Property 202.12 166.83 137.08 158.45 159.14 130.78 140.24 161.84 166.28 151.50 142.57 183.37 206.42 169.77 144.92 124.29 131.11 69.24 149.26 146.74 148.94 113.33 149.35 107.55 149.26 146.74 148.94

Competitive Set 167.49 137.10 117.68 119.70 111.91 93.06 104.97 116.43 122.77 121.04 111.15 148.60 161.58 130.18 113.31 99.91 98.90 73.70 117.94 123.48 116.84 98.76 108.18 90.75 117.94 123.48 116.84

Index (RGI) 120.7 121.7 116.5 132.4 142.2 140.5 133.6 139.0 135.4 125.2 128.3 123.4 127.7 130.4 127.9 124.4 132.6 93.9 126.6 118.8 127.5 114.8 138.1 118.5 126.6 118.8 127.5

Rank 2 of 7 3 of 7 4 of 7 1 of 7 1 of 7 1 of 7 3 of 7 1 of 7 2 of 7 3 of 7 3 of 7 2 of 7 2 of 7 2 of 7 3 of 7 3 of 7 3 of 7 4 of 7 3 of 7 3 of 7 3 of 7 3 of 7 1 of 7 4 of 7 3 of 7 3 of 7 3 of 7 % Chg

My Property -0.4 -3.8 -7.4 9.8 49.7 46.6 82.2 21.8 13.4 16.2 0.1 4.0 2.1 1.8 5.7 -21.6 -17.6 -47.1 -1.9 -1.7 1.5 -16.3 31.8 -28.0 -1.9 -1.7 1.5

Competitive Set 0.5 3.3 7.8 8.6 10.9 9.2 15.4 -3.7 -5.9 -1.1 -8.2 -0.2 -3.5 -5.0 -3.7 -16.5 -11.6 -20.8 0.3 4.7 -5.4 -2.7 9.5 -16.1 0.3 4.7 -5.4

Index (RGI) -0.9 -6.8 -14.1 1.1 35.1 34.2 58.0 26.5 20.5 17.5 9.1 4.2 5.9 7.2 9.8 -6.0 -6.8 -33.1 -2.2 -6.1 7.3 -14.0 20.3 -14.2 -2.2 -6.1 7.3

Rank 5 of 7 6 of 7 7 of 7 3 of 7 1 of 7 1 of 7 1 of 7 1 of 7 1 of 7 1 of 7 1 of 7 3 of 7 1 of 7 1 of 7 1 of 7 5 of 7 6 of 7 7 of 7 5 of 7 6 of 7 1 of 7 7 of 7 1 of 7 6 of 7 5 of 7 6 of 7 1 of 7 Exchange Rate

The STR STAR Report is a publication of STR, Inc. and STR Global, Ltd., and is intended solely for use by paid subscribers. Reproduction or distribution of the STR STAR Report, in whole or part, without written permission is prohibited and subject to legal action. If you have received this report and are NOT a subscriber to the STR STAR Report, please contact us immediately. Source: 2020 STR, Inc. / STR Global, Ltd. trading as “STR”. Tab 5 - Response Report Residence Inn San Diego Mission Valley 1865 Hotel Cir S San Diego, CA 92108-3319 Phone: (619) 881-3600 STR # 45777 ChainID: SANHC MgtCo: Island Hospitality Management Owner: Chatham Lodging Trust For the Month of: December 2019 Date Created: January 17, 2020

This Year December 2019 (This Year) December 2018 (Last Year) Dec 23rd - First Day of Hanukkah Sun Mon Tue Wed Thu Fri Sat Sun Mon Tue Wed Thu Fri Sat Dec 24th - Christmas Eve 1 32 7654 1 Dec 25th - Christmas Day 8 91110 12 13 14 253 4 678 Dec 26th - First Day of Kwanzaa 15 1716 18 19 20 21 9 10 11 12 13 14 15 Dec 31st - New Year's Eve 22 2324 25 26 27 28 1716 18 19 20 21 22 29 30 31 23 24 25 2726 28 29 3031 Last Year Dec 3rd - First Day of Hanukkah Dec 24th - Christmas Eve Dec 25th - Christmas Dec 26th - First Day of Kwanzaa Dec 31st - New Year's Eve

2018 2019

STR# Name City, State Zip Phone Rooms Open Date Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 45777 Residence Inn San Diego Mission Valley San Diego, CA 92108-3319 (619) 881-3600 192 200303 ●●●●●●●●●●●●●●●●●●●●●●●● 9581 Sheraton Hotel San Diego Mission Valley San Diego, CA 92108-3521 (619) 260-0111 260 198407 ●●●●●●●●●●●●●●●●●●●●●●●● 17360 DoubleTree by Hilton Hotel San Diego Hotel CircleSan Diego, CA 92108-3409 (619) 881-6900 219 197006 ●●●●●●●●●●●●●●●●●●●●●●●● 22368 Residence Inn San Diego Central San Diego, CA 92111-1303 (858) 278-2100 144 198905 ●●●●●●●●●●●●●●●●●●●●●●●● 39251 Extended Stay America San Diego Hotel Circle San Diego, CA 92108-3313 (619) 296-5570 166 199911 ●●●●●●●●●●●●●●●●●●●●●●●● 63814 Holiday Inn Express & Suites San Diego Mission VSan Diego, CA 92108-3404 (619) 795-7705 104 201505 ●●●●●●●●●●●●●●●●●●●●●●●● 64528 Homewood Suites by Hilton San Diego Mission VaSan Diego, CA 92108-3502 (619) 260-0600 118 201604 ●●●●●●●●●●●●●●●●●●●●●●●● 1203 Data received: ○ = Monthly Only ● = Monthly & Daily

The STR STAR Report is a publication of STR, Inc. and STR Global, Ltd., and is intended solely for use by paid subscribers. Reproduction or distribution of the STR STAR Report, in whole or part, without written permission is prohibited and subject to legal action. If you have received this report and are NOT a subscriber to the STR STAR Report, please contact us immediately. Source: 2020 STR, Inc. / STR Global, Ltd. trading as “STR”. Tab 6 - Day of Week and Weekday/Weekend Report Residence Inn San Diego Mission Valley 1865 Hotel Cir S San Diego, CA 92108-3319 Phone: (619) 881-3600 STR # 45777 ChainID: SANHC MgtCo: Island Hospitality Management Owner: Chatham Lodging Trust For the Month of: December 2019 Date Created: January 17, 2020 Monthly Competitive Set Data Excludes Subject Property

Current Month Occupancy Current Month ADR

152 74 142 64 My Property 132 54 Competitive Set 122 44 112 34 102 Sunday Monday Tuesday Wednesday Thursday Friday Saturday Weekday Weekend Sunday Monday Tuesday Wednesday Thursday Friday Saturday Weekday Weekend

Occupancy (%) Average Daily Rate RevPAR My Property Competitive Set Index (MPI) My Property Competitive Set Index (ARI) My Property Competitive Set Index (RGI) Day of Week Time Period % Chg % Chg % Chg % Chg % Chg% Chg% Chg% Chg% Chg Sunday Current Month 38.6 -51.8 56.3 -19.0 68.7 -40.4 135.19 -22.0 106.75 -20.2 126.6 -2.3 52.25 -62.4 60.10 -35.3 86.9 -41.8 Year To Date 76.2 -4.9 70.2 -6.9 108.6 2.2 168.39 1.0 134.64 -0.7 125.1 1.7 128.27 -3.9 94.45 -7.5 135.8 3.9 Running 3 Month 59.9 -28.8 62.9 -8.5 95.3 -22.2 146.91 -12.2 114.66 -13.0 128.1 0.9 88.02 -37.5 72.07 -20.3 122.1 -21.5 Running 12 Month 76.2 -4.9 70.2 -6.9 108.6 2.2 168.39 1.0 134.64 -0.7 125.1 1.7 128.27 -3.9 94.45 -7.5 135.8 3.9

Monday Current Month 52.8 -36.4 61.7 -19.1 85.5 -21.4 135.81 -22.3 109.06 -21.0 124.5 -1.6 71.68 -50.6 67.33 -36.1 106.5 -22.7 Year To Date 82.6 -1.4 77.6 -6.3 106.5 5.2 177.22 2.9 142.88 1.0 124.0 1.9 146.38 1.5 110.80 -5.4 132.1 7.3 Running 3 Month 66.8 -24.3 68.8 -11.2 97.0 -14.8 151.49 -10.3 121.70 -11.0 124.5 0.8 101.14 -32.1 83.75 -21.0 120.8 -14.1 Running 12 Month 82.6 -1.4 77.6 -6.3 106.5 5.2 177.22 2.9 142.88 1.0 124.0 1.9 146.38 1.5 110.80 -5.4 132.1 7.3

Tuesday Current Month 62.9 -16.5 67.1 -2.7 93.7 -14.1 136.39 -14.1 110.89 -11.4 123.0 -3.1 85.75 -28.3 74.40 -13.8 115.3 -16.8 Year To Date 86.9 -0.2 82.2 -5.5 105.7 5.6 175.04 2.1 145.91 1.4 120.0 0.6 152.12 1.9 119.91 -4.1 126.9 6.3 Running 3 Month 73.4 -16.2 74.3 -4.6 98.7 -12.1 152.03 -8.8 125.77 -8.2 120.9 -0.7 111.60 -23.6 93.51 -12.4 119.4 -12.8 Running 12 Month 86.9 -0.2 82.2 -5.5 105.7 5.6 175.04 2.1 145.91 1.4 120.0 0.6 152.12 1.9 119.91 -4.1 126.9 6.3

Wednesday Current Month 57.1 -24.1 69.9 -2.5 81.7 -22.1 134.21 -13.7 110.28 -8.5 121.7 -5.7 76.69 -34.5 77.12 -10.8 99.4 -26.6 Year To Date 88.2 1.3 84.3 -4.5 104.5 6.1 176.61 3.0 147.37 0.8 119.8 2.2 155.68 4.4 124.28 -3.8 125.3 8.5 Running 3 Month 74.1 -15.8 75.8 -5.2 97.7 -11.2 153.49 -7.7 125.99 -7.5 121.8 -0.2 113.68 -22.3 95.52 -12.3 119.0 -11.4 Running 12 Month 88.2 1.3 84.3 -4.5 104.5 6.1 176.61 3.0 147.37 0.8 119.8 2.2 155.68 4.4 124.28 -3.8 125.3 8.5

Thursday Current Month 49.6 -34.4 67.7 -4.3 73.2 -31.4 141.65 -9.9 111.85 -4.6 126.6 -5.5 70.22 -40.8 75.75 -8.7 92.7 -35.2 Year To Date 86.5 0.3 82.1 -5.9 105.4 6.5 175.59 3.0 142.92 -0.2 122.9 3.2 151.85 3.3 117.29 -6.0 129.5 9.9 Running 3 Month 71.7 -18.5 73.6 -9.2 97.4 -10.2 154.67 -8.1 123.18 -8.9 125.6 0.9 110.94 -25.1 90.67 -17.3 122.4 -9.5 Running 12 Month 86.5 0.3 82.1 -5.9 105.4 6.5 175.59 3.0 142.92 -0.2 122.9 3.2 151.85 3.3 117.29 -6.0 129.5 9.9

Friday Current Month 42.9 -42.4 73.8 1.8 58.1 -43.4 149.32 -7.1 114.32 -2.1 130.6 -5.1 64.04 -46.5 84.35 -0.4 75.9 -46.3 Year To Date 86.7 0.4 86.0 -4.5 100.7 5.2 176.25 2.0 140.90 -2.1 125.1 4.2 152.78 2.4 121.23 -6.5 126.0 9.6 Running 3 Month 72.4 -18.6 80.5 -5.2 89.8 -14.2 153.88 -11.5 121.03 -11.6 127.1 0.1 111.35 -28.0 97.47 -16.2 114.2 -14.1 Running 12 Month 86.7 0.4 86.0 -4.5 100.7 5.2 176.25 2.0 140.90 -2.1 125.1 4.2 152.78 2.4 121.23 -6.5 126.0 9.6

Saturday Current Month 45.3 -47.2 75.8 -5.4 59.7 -44.2 140.38 -18.1 107.78 -18.9 130.2 0.9 63.57 -56.8 81.71 -23.3 77.8 -43.6 Year To Date 89.8 0.8 90.4 -2.6 99.4 3.4 173.09 -0.3 143.72 -2.3 120.4 2.1 155.42 0.4 129.88 -4.8 119.7 5.5 Running 3 Month 77.5 -16.4 84.2 -2.3 92.0 -14.4 149.45 -13.7 121.16 -12.5 123.3 -1.3 115.85 -27.8 102.04 -14.6 113.5 -15.5 Running 12 Month 89.8 0.8 90.4 -2.6 99.4 3.4 173.09 -0.3 143.72 -2.3 120.4 2.1 155.42 0.4 129.88 -4.8 119.7 5.5 Weekday/Weekend Weekday Current Month 52.1 -33.4 64.2 -10.3 81.2 -25.7 136.52 -17.3 109.78 -14.2 124.4 -3.7 71.13 -44.9 70.46 -23.0 101.0 -28.4 (Sun-Thu) Year To Date 84.1 -0.9 79.3 -5.8 106.1 5.2 174.71 2.5 143.02 0.5 122.2 1.9 146.88 1.5 113.37 -5.2 129.6 7.2 Running 3 Month 69.2 -20.6 71.1 -7.7 97.3 -14.0 151.90 -9.3 122.58 -9.5 123.9 0.2 105.17 -28.0 87.20 -16.4 120.6 -13.9 Running 12 Month 84.1 -0.9 79.3 -5.8 106.1 5.2 174.71 2.5 143.02 0.5 122.2 1.9 146.88 1.5 113.37 -5.2 129.6 7.2

Weekend Current Month 44.1 -45.4 74.8 -2.5 58.9 -44.0 144.73 -13.4 111.00 -12.0 130.4 -1.6 63.80 -52.7 83.03 -14.2 76.8 -44.9 (Fri-Sat) Year To Date 88.2 0.6 88.2 -3.5 100.0 4.3 174.64 0.8 142.35 -2.2 122.7 3.1 154.10 1.4 125.56 -5.7 122.7 7.5 Running 3 Month 74.9 -17.5 82.4 -3.7 91.0 -14.3 151.59 -12.6 121.10 -12.1 125.2 -0.6 113.60 -27.9 99.76 -15.4 113.9 -14.8 Running 12 Month 88.2 0.6 88.2 -3.5 100.0 4.3 174.64 0.8 142.35 -2.2 122.7 3.1 154.10 1.4 125.56 -5.7 122.7 7.5

Total Current Month 50.0 -36.6 66.9 -8.4 74.8 -30.8 138.39 -16.5 110.13 -13.5 125.7 -3.4 69.24 -47.1 73.70 -20.8 93.9 -33.1 Year To Date 85.3 -0.5 81.8 -5.1 104.2 4.9 174.69 2.0 142.82 -0.3 122.3 2.3 148.94 1.5 116.84 -5.4 127.5 7.3 Running 3 Month 70.8 -19.7 74.3 -6.5 95.3 -14.1 151.81 -10.3 122.12 -10.3 124.3 0.0 107.55 -28.0 90.75 -16.1 118.5 -14.2 Running 12 Month 85.3 -0.5 81.8 -5.1 104.2 4.9 174.69 2.0 142.82 -0.3 122.3 2.3 148.94 1.5 116.84 -5.4 127.5 7.3

Residence Inn San Diego Mission Valley 1865 Hotel Cir S San Diego, CA 92108-3319 Phone: (619) 881-3600

STR # 45777 ChainID: SANHC MgtCo: Island Hospitality Management Owner: Chatham Lodging Trust

For the Month of: December 2019 Date Created: January 17, 2020 Daily Competitive Set Data Excludes Subject Property Daily Indexes for the Month of December

155

135

115

-5 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 Occupancy Index (MPI) ADR Index (ARI) RevPAR Index (RGI) 100 %

Su Mo Tu We Th Fr Sa Su Mo Tu We Th Fr Sa Su Mo Tu We Th Fr Sa Su Mo Tu We Th Fr Sa Su Mo Tu December Occupancy (%) 12345678910111213141516171819202122232425262728293031

My Property 41.7 59.9 67.7 76.0 74.5 79.2 88.0 65.1 74.0 80.7 75.0 33.9 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 49.0 80.7 84.9 96.4 97.9 99.0 92.7 89.6 95.3

Competitive Set 43.3 60.3 75.8 87.6 78.5 75.3 74.7 56.4 70.8 73.6 78.0 68.2 72.8 77.1 49.6 54.4 54.5 53.7 50.0 56.0 62.1 51.3 51.7 57.2 62.6 76.4 93.5 91.9 83.2 73.9 77.2

Index (MPI) 96.2 99.3 89.4 86.8 94.8 105.2 117.9 115.5 104.4 109.7 96.1 49.6 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 94.6 141.2 135.6 126.2 104.8 107.7 111.4 121.2 123.5 % Chg

My Property -58.1 -40.1 -21.2 2.1 -7.1 0.0 12.7 -5.3 -5.3 2.6 0.7 -46.7 -100.0 -100.0 -100.0 -100.0 -100.0 -100.0 -100.0 -100.0 -100.0 -100.0 -40.1 -1.9 -9.4 -3.1 -1.6 -1.0 -5.8 -10.4 51.2

Competitive Set -55.0 -38.8 -7.9 8.8 -6.1 -11.7 -14.4 -11.2 -8.6 -9.8 -2.6 -2.1 6.2 13.7 2.9 3.0 12.0 11.5 17.2 17.2 5.0 -12.2 -18.0 -10.2 -20.2 -12.6 5.2 0.4 2.1 -17.9 60.2

Index (MPI) -6.9 -2.1 -14.4 -6.2 -1.1 13.3 31.6 6.7 3.5 13.8 3.4 -45.6 -100.0 -100.0 -100.0 -100.0 -100.0 -100.0 -100.0 -100.0 -100.0 -100.0 -27.0 9.3 13.4 10.8 -6.5 -1.5 -7.7 9.1 -5.6

December ADR 12345678910111213141516171819202122232425262728293031

My Property 135.20 149.58 162.19 146.81 147.90 142.13 134.75 135.20 142.90 137.01 138.25 114.95 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 101.74 110.10 119.22 146.09 155.04 145.29 135.07 139.22 139.64

Competitive Set 108.85 114.44 114.47 112.88 115.75 110.30 106.08 107.62 114.43 107.38 113.49 110.43 102.22 102.12 105.24 105.80 104.61 105.84 104.00 102.55 97.77 100.45 95.71 100.08 101.32 110.12 130.29 116.96 106.10 106.55 118.17

Index (ARI) 124.2 130.7 141.7 130.1 127.8 128.9 127.0 125.6 124.9 127.6 121.8 104.1 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 106.3 110.0 117.7 132.7 119.0 124.2 127.3 130.7 118.2 % Chg

My Property -39.6 -33.7 -6.7 -7.5 -4.8 -8.5 -11.7 -14.5 -5.3 -11.0 -10.7 -27.4 -100.0 -100.0 -100.0 -100.0 -100.0 -100.0 -100.0 -100.0 -100.0 -100.0 -28.3 -25.7 -24.4 -9.7 -12.8 -15.5 -20.1 -21.9 -10.7

Competitive Set -39.1 -36.0 -22.3 -13.3 -8.5 -13.4 -12.6 -9.3 -4.8 -11.9 -6.8 -3.9 -5.4 -5.1 -5.8 -13.2 -9.8 -10.2 -7.2 -0.9 -8.8 -5.3 -9.9 -6.6 -8.4 -2.0 8.5 -10.2 -14.6 -23.7 6.4

Index (ARI) -0.8 3.7 20.1 6.7 4.0 5.7 1.0 -5.7 -0.6 1.1 -4.2 -24.5 -100.0 -100.0 -100.0 -100.0 -100.0 -100.0 -100.0 -100.0 -100.0 -100.0 -20.4 -20.5 -17.5 -7.9 -19.6 -5.9 -6.4 2.5 -16.1

December RevPAR 12345678910111213141516171819202122232425262728293031

My Property 56.33 89.59 109.82 111.64 110.16 112.52 118.61 88.02 105.69 110.60 103.69 38.92 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 49.81 88.89 101.21 140.76 151.81 143.78 125.22 124.71 133.10

Competitive Set 47.16 69.05 86.73 98.92 90.90 83.02 79.22 60.68 81.04 79.02 88.57 75.37 74.41 78.69 52.15 57.56 57.01 56.85 51.95 57.41 60.73 51.57 49.51 57.22 63.44 84.09 121.78 107.47 88.26 78.72 91.17

Index (RGI) 119.5 129.8 126.6 112.9 121.2 135.5 149.7 145.1 130.4 140.0 117.1 51.6 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 100.6 155.3 159.5 167.4 124.7 133.8 141.9 158.4 146.0 % Chg

My Property -74.7 -60.3 -26.5 -5.6 -11.6 -8.5 -0.6 -19.0 -10.4 -8.6 -10.1 -61.3 -100.0 -100.0 -100.0 -100.0 -100.0 -100.0 -100.0 -100.0 -100.0 -100.0 -57.1 -27.1 -31.6 -12.5 -14.2 -16.4 -24.7 -30.0 35.0

Competitive Set -72.6 -60.9 -28.5 -5.7 -14.1 -23.5 -25.2 -19.4 -12.9 -20.6 -9.2 -6.0 0.5 8.0 -3.1 -10.6 1.0 0.1 8.7 16.1 -4.3 -16.8 -26.1 -16.2 -26.9 -14.3 14.2 -9.8 -12.9 -37.4 70.4

Index (RGI) -7.6 1.5 2.8 0.1 2.9 19.7 32.9 0.5 2.9 15.1 -1.0 -58.9 -100.0 -100.0 -100.0 -100.0 -100.0 -100.0 -100.0 -100.0 -100.0 -100.0 -41.9 -13.1 -6.4 2.1 -24.8 -7.3 -13.6 11.8 -20.8

The STR STAR Report is a publication of STR, Inc. and STR Global, Ltd., and is intended solely for use by paid subscribers. Reproduction or distribution of the STR STAR Report, in whole or part, without written permission is prohibited and subject to legal action. If you have received this report and are NOT a subscriber to the STR STAR Report, please contact us immediately. Sou rce: 2020 STR, Inc. / STR Global, Ltd. trading as “STR”. Tab 8 - Segmentation at a Glance - My Property vs. Competitive Set Residence Inn San Diego Mission Valley 1865 Hotel Cir S San Diego, CA 92108-3319 Phone: (619) 881-3600 STR # 45777 ChainID: SANHC MgtCo: Island Hospitality Management Owner: Chatham Lodging Trust For the Month of: December 2019 Date Created: January 17, 2020 Monthly Competitive Set Data Excludes Subject Property

December 2019

Transient Group Contract Total % Chg % Chg % Chg % Chg Occupancy (%) My Property 43.1 -29.1 My Property 7.0 -61.6 My Property 0.0 0.0 My Property 50.0 -36.6 Comp set 63.5 8.2 Comp set 1.0 -92.4 Comp set 2.5 131.9 Comp set 66.9 -8.4 Index (MPI) 67.8 -34.5 Index (MPI) 685.1 404.2 Index (MPI) 0.0 0.0 Index (MPI) 74.8 -30.8

ADR My Property 134.23 -16.7 My Property 164.00 -9.4 My Property 0.00 0.0 My Property 138.39 -16.5 Comp set 110.98 -7.9 Comp set 126.61 -20.7 Comp set 81.42 -17.8 Comp set 110.13 -13.5 Index (ARI) 121.0 -9.5 Index (ARI) 129.5 14.2 Index (ARI) 0.0 0.0 Index (ARI) 125.7 -3.4

RevPAR My Property 57.79 -41.0 My Property 11.45 -65.2 My Property 0.00 0.0 My Property 69.24 -47.1 Comp set 70.42 -0.4 Comp set 1.29 -94.0 Comp set 2.00 90.5 Comp set 73.70 -20.8 Index (RGI) 82.1 -40.8 Index (RGI) 887.5 476.0 Index (RGI) 0.0 0.0 Index (RGI) 93.9 -33.1

Year To Date

Transient Group Contract Total % Chg % Chg % Chg % Chg Occupancy (%) My Property 69.9 -0.1 My Property 15.3 -2.2 My Property 0.0 0.0 My Property 85.3 -0.5 Comp set 69.2 -4.9 Comp set 10.6 -14.1 Comp set 2.0 89.4 Comp set 81.8 -5.1 Index (MPI) 101.1 5.1 Index (MPI) 144.3 13.8 Index (MPI) 0.0 0.0 Index (MPI) 104.2 4.9

ADR My Property 174.41 1.2 My Property 175.97 5.8 My Property 0.00 0.0 My Property 174.69 2.0 Comp set 141.61 -0.4 Comp set 157.76 3.3 Comp set 105.24 -1.9 Comp set 142.82 -0.3 Index (ARI) 123.2 1.5 Index (ARI) 111.5 2.4 Index (ARI) 0.0 0.0 Index (ARI) 122.3 2.3

RevPAR My Property 121.94 1.1 My Property 27.00 3.4 My Property 0.00 0.0 My Property 148.94 1.5 Comp set 97.95 -5.3 Comp set 16.78 -11.3 Comp set 2.12 85.8 Comp set 116.84 -5.4 Index (RGI) 124.5 6.7 Index (RGI) 160.9 16.6 Index (RGI) 0.0 0.0 Index (RGI) 127.5 7.3

The STR STAR Report is a publication of STR, Inc. and STR Global, Ltd., and is intended solely for use by paid subscribers. Reproduction or distribution of the STR STAR Report, in whole or part, without written permission is prohibited and subject to legal action. If you have received this report and are NOT a subscriber to the STR STAR Report, please contact us immediately. Source: 2020 STR, Inc. / STR Global, Ltd. trading as “STR”. Tab 9 - Segmentation Occupancy Analysis Residence Inn San Diego Mission Valley 1865 Hotel Cir S San Diego, CA 92108-3319 Phone: (619) 881-3600 STR # 45777 ChainID: SANHC MgtCo: Island Hospitality Management Owner: Chatham Lodging Trust Market Scale: San Diego, CA Upscale Chains For the Month of: December 2019 Date Created: January 17, 2020 Monthly Competitive Set Data Excludes Subject Property

Occupancy (%) Percent Change (%) Transient Group Contract Total Transient Group Contract Total Current Market Market Market Market Market Market Market Market Month My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale 2018 Jul 83.0 67.3 70.7 14.5 24.5 16.8 0.0 0.3 4.2 97.6 92.2 91.7 11.4 -5.9 -1.7 -28.7 7.6 2.2 0.0 -49.8 10.0 2.8 -2.9 -0.5 Aug 73.1 78.0 73.8 23.5 11.6 11.7 0.0 0.8 4.1 96.6 90.3 89.6 -2.8 0.7 2.6 27.9 18.3 -6.5 0.0 -48.3 13.7 3.3 1.8 1.7 Sep 73.1 74.6 67.2 12.7 10.0 12.8 0.0 1.1 3.8 85.8 85.8 83.8 16.1 10.5 1.1 -52.7 -3.1 -4.5 0.0 -41.4 7.3 -4.5 7.5 0.5 Oct 75.5 70.6 66.7 17.7 12.4 14.8 0.0 2.3 3.6 93.2 85.4 85.1 33.1 -4.3 4.0 -44.6 54.8 20.3 0.0 128.7 8.4 5.1 3.0 6.7 Nov 65.7 62.3 62.2 26.9 16.1 13.1 0.0 1.4 3.7 92.7 79.9 79.0 43.4 -12.3 4.9 7.3 63.8 -2.3 0.0 179.2 9.5 30.6 -1.8 3.8 Dec 60.8 58.7 58.4 18.2 13.4 11.9 0.0 1.1 3.6 78.9 73.1 74.0 31.8 -20.6 -3.3 9.7 212.7 101.0 0.0 59.6 7.2 26.0 -7.3 6.0 2019 Jan 68.6 64.4 59.3 14.5 13.9 14.5 0.0 1.0 3.4 83.1 79.3 77.3 47.7 -6.2 -0.5 85.2 97.6 60.8 0.0 445.3 3.2 53.1 4.5 7.3 Feb 58.3 58.8 64.7 32.6 20.7 14.1 0.0 1.5 3.5 90.9 80.9 82.3 -19.7 -24.7 -4.8 271.2 93.2 13.2 0.0 427.7 10.7 11.6 -9.1 -1.5 Mar 67.5 77.2 70.3 25.7 7.4 12.0 0.0 2.0 3.7 93.2 86.6 85.9 -18.7 -4.4 -1.0 696.4 -39.0 -7.6 0.0 67.7 3.5 8.1 -7.9 -1.8 Apr 73.3 73.4 70.6 14.8 8.8 10.8 0.0 3.1 3.5 88.1 85.3 85.0 0.1 -9.5 2.0 192.5 25.8 -1.8 0.0 123.8 -3.9 12.5 -4.7 1.3 May 77.6 64.6 63.4 6.7 12.0 12.0 0.0 1.2 3.4 84.4 77.7 78.7 22.8 -15.9 -4.0 -72.1 63.6 -8.2 0.0 -32.0 -10.9 -3.4 -9.5 -5.0 Jun 81.0 74.1 70.9 12.2 14.3 15.4 0.0 2.1 3.6 93.2 90.5 89.9 15.6 -3.2 0.7 -51.7 -11.9 -4.0 0.0 128.2 -20.2 -2.3 -3.4 -1.2 Jul 78.1 69.2 71.5 19.0 18.4 16.0 0.0 1.8 4.0 97.1 89.5 91.4 -6.0 2.9 1.1 31.1 -25.0 -4.5 0.0 470.2 -6.9 -0.4 -2.9 -0.3 Aug 70.1 79.1 73.1 24.6 6.4 11.2 0.0 1.3 3.5 94.7 86.8 87.7 -4.1 1.4 -1.0 4.8 -44.6 -5.0 0.0 66.4 -13.4 -1.9 -4.0 -2.1 Sep 72.8 71.4 65.9 13.9 8.9 13.5 0.0 1.9 3.5 86.7 82.3 82.9 -0.4 -4.3 -1.9 9.3 -11.1 5.8 0.0 73.6 -9.3 1.1 -4.1 -1.1 Oct 67.7 63.5 65.4 9.6 10.0 10.3 0.0 3.9 3.9 77.4 77.4 79.6 -10.3 -10.1 -1.9 -45.5 -19.4 -30.5 0.0 67.1 9.0 -17.0 -9.3 -6.4 Nov 81.5 70.1 63.7 4.8 6.8 9.1 0.0 1.9 3.8 86.3 78.7 76.6 23.9 12.5 2.3 -82.1 -58.1 -30.5 0.0 30.4 3.3 -6.9 -1.4 -3.1 Dec 43.1 63.5 57.9 7.0 1.0 5.5 0.0 2.5 3.7 50.0 66.9 67.1 -29.1 8.2 -0.9 -61.6 -92.4 -53.6 0.0 131.9 1.4 -36.6 -8.4 -9.3

Year To Date 2017 63.8 72.5 65.5 21.7 11.0 13.0 0.0 1.3 3.3 85.5 84.9 81.8 -9.6 2.5 2.0 13.9 -9.5 1.8 0.0 -7.2 19.3 -4.0 0.6 2.5 2018 70.0 72.8 66.9 15.7 12.4 13.0 0.0 1.1 3.7 85.7 86.2 83.7 9.7 0.3 2.2 -27.9 12.1 -0.2 0.0 -18.9 11.7 0.2 1.5 2.2 2019 69.9 69.2 66.4 15.3 10.6 12.0 0.0 2.0 3.6 85.3 81.8 82.0 -0.1 -4.9 -0.9 -2.2 -14.1 -7.6 0.0 89.4 -3.6 -0.5 -5.1 -2.0

Running 3 Month 2017 49.6 72.9 61.4 24.5 7.4 10.5 0.0 0.7 3.3 74.1 81.0 75.2 -29.4 14.9 2.3 109.9 -41.1 -9.7 0.0 -23.7 18.3 -9.6 5.3 1.1 2018 67.4 63.9 62.5 20.9 13.9 13.3 0.0 1.6 3.6 88.2 79.4 79.4 35.8 -12.4 1.8 -15.0 89.6 26.2 0.0 119.4 8.3 19.0 -2.0 5.5 2019 63.7 65.6 62.3 7.2 5.9 8.3 0.0 2.8 3.8 70.8 74.3 74.4 -5.5 2.7 -0.3 -65.6 -57.6 -37.6 0.0 70.7 4.5 -19.7 -6.5 -6.3

Running 12 Month 2017 63.8 72.5 65.5 21.7 11.0 13.0 0.0 1.3 3.3 85.5 84.9 81.8 -9.6 2.5 2.0 13.9 -9.5 1.8 0.0 -7.2 19.3 -4.0 0.6 2.5 2018 70.0 72.8 66.9 15.7 12.4 13.0 0.0 1.1 3.7 85.7 86.2 83.7 9.7 0.3 2.2 -27.9 12.1 -0.2 0.0 -18.9 11.7 0.2 1.5 2.2 2019 69.9 69.2 66.4 15.3 10.6 12.0 0.0 2.0 3.6 85.3 81.8 82.0 -0.1 -4.9 -0.9 -2.2 -14.1 -7.6 0.0 89.4 -3.6 -0.5 -5.1 -2.0

The STR STAR Report is a publication of STR, Inc. and STR Global, Ltd., and is intended solely for use by paid subscribers. Reproduction or distribution of the STR STAR Report, in whole or part, without written permission is prohibited and subject to legal action. If you have received this report and are NOT a subscriber to the STR STAR Report, please contact us immediately. Source: 2020 STR, Inc. / STR Global, Ltd. trading as “STR”. Tab 10 - Segmentation ADR Analysis Residence Inn San Diego Mission Valley 1865 Hotel Cir S San Diego, CA 92108-3319 Phone: (619) 881-3600 STR # 45777 ChainID: SANHC MgtCo: Island Hospitality Management Owner: Chatham Lodging Trust Market Scale: San Diego, CA Upscale Chains For the Month of: December 2019 Date Created: January 17, 2020 Monthly Competitive Set Data Excludes Subject Property

Average Daily Rate Percent Change (%) Transient Group Contract TotalTransient Group Contract Total Current Market Market Market Market Market Market Market Market Month My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale 2018 Jul 211.94 179.94 200.07 179.83 186.67 207.03 0.00 183.82 117.52 207.16 181.75 197.52 -6.6 2.5 2.8 8.6 6.1 1.9 0.0 25.8 7.3 -3.1 3.5 2.6 Aug 177.79 151.87 172.88 156.91 152.76 175.84 0.00 124.03 115.84 172.72 151.75 170.67 -7.7 1.4 1.8 0.6 -1.1 3.4 0.0 8.8 6.6 -6.8 1.4 1.9 Sep 159.84 137.21 158.28 159.82 138.95 160.57 0.00 119.78 112.26 159.84 137.19 156.53 -6.2 -0.6 3.2 5.2 2.8 3.4 0.0 13.1 9.2 -3.1 0.2 3.3 Oct 170.63 141.23 159.05 167.25 141.46 162.29 0.00 99.63 111.04 169.99 140.13 157.59 0.8 5.7 5.5 10.8 7.3 1.1 0.0 4.9 8.7 4.5 5.4 4.9 Nov 172.19 138.29 153.13 170.59 150.89 177.24 0.00 99.61 112.56 171.72 140.13 155.25 18.8 13.1 7.2 7.6 9.3 6.4 0.0 -6.3 3.0 14.7 13.0 6.7 Dec 161.12 120.49 136.78 181.10 159.72 172.10 0.00 99.09 110.61 165.72 127.35 141.18 15.0 12.8 10.6 21.8 21.9 26.1 0.0 1.8 1.5 16.4 17.9 13.9 2019 Jan 166.33 131.79 148.92 179.69 137.28 156.52 0.00 100.98 113.30 168.66 132.36 148.79 19.5 10.3 7.8 14.9 10.4 6.8 0.0 1.5 5.2 19.0 10.4 7.9 Feb 182.64 140.08 161.60 169.68 157.40 158.95 0.00 105.76 115.55 177.99 143.87 159.21 11.6 3.0 2.0 6.9 16.4 -4.5 0.0 -6.6 9.7 9.1 5.9 1.0 Mar 180.02 142.72 159.68 174.13 141.51 166.21 0.00 104.62 117.04 178.39 141.75 158.77 5.8 2.6 0.3 4.6 2.1 6.4 0.0 -3.7 5.9 4.9 2.2 1.3 Apr 171.11 143.65 160.08 175.74 141.40 170.98 0.00 101.97 115.19 171.89 141.90 159.61 3.0 4.6 1.9 3.5 3.5 6.3 0.0 8.6 5.0 3.3 3.8 2.6 May 168.18 140.89 160.20 178.53 156.67 181.95 0.00 120.00 111.95 169.01 143.01 161.45 1.5 -0.9 0.5 14.1 12.6 5.7 0.0 25.4 1.7 3.6 1.4 1.5 Jun 197.78 162.95 181.12 189.72 177.64 195.73 0.00 115.07 117.22 196.72 164.14 181.07 3.9 2.6 3.2 12.1 10.5 11.0 0.0 -13.8 -0.4 6.5 3.3 4.8 Jul 214.90 176.24 197.59 202.79 199.72 207.35 0.00 152.69 117.68 212.53 180.59 195.85 1.4 -2.1 -1.2 12.8 7.0 0.2 0.0 -16.9 0.1 2.6 -0.6 -0.8 Aug 182.52 149.46 168.42 169.82 162.36 179.67 0.00 122.79 117.57 179.22 150.02 167.80 2.7 -1.6 -2.6 8.2 6.3 2.2 0.0 -1.0 1.5 3.8 -1.1 -1.7 Sep 167.64 138.96 156.38 164.98 133.66 166.34 0.00 111.46 110.97 167.22 137.74 156.11 4.9 1.3 -1.2 3.2 -3.8 3.6 0.0 -6.9 -1.2 4.6 0.4 -0.3 Oct 159.30 129.41 149.11 170.06 140.88 164.56 0.00 92.26 107.16 160.64 129.02 149.05 -6.6 -8.4 -6.2 1.7 -0.4 1.4 0.0 -7.4 -3.5 -5.5 -7.9 -5.4 Nov 151.33 125.10 144.63 161.88 141.85 159.56 0.00 87.20 110.21 151.92 125.63 144.71 -12.1 -9.5 -5.6 -5.1 -6.0 -10.0 0.0 -12.5 -2.1 -11.5 -10.3 -6.8 Dec 134.23 110.98 132.77 164.00 126.61 141.39 0.00 81.42 117.37 138.39 110.13 132.64 -16.7 -7.9 -2.9 -9.4 -20.7 -17.8 0.0 -17.8 6.1 -16.5 -13.5 -6.1

Year To Date 2017 179.56 137.90 156.26 159.89 149.88 166.47 0.00 103.82 104.20 174.55 138.93 155.75 1.8 -0.7 2.9 4.9 1.9 3.0 0.0 5.6 10.0 2.1 -0.3 2.8 2018 172.41 142.16 161.54 166.36 152.75 171.14 0.00 107.33 112.11 171.31 143.25 160.82 -4.0 3.1 3.4 4.0 1.9 2.8 0.0 3.4 7.6 -1.9 3.1 3.3 2019 174.41 141.61 160.80 175.97 157.76 173.51 0.00 105.24 114.24 174.69 142.82 160.61 1.2 -0.4 -0.5 5.8 3.3 1.4 0.0 -1.9 1.9 2.0 -0.3 -0.1

Running 3 Month 2017 152.82 120.84 139.27 152.99 134.41 158.47 0.00 98.28 106.79 152.88 121.87 140.51 -8.1 -6.2 -1.0 -3.7 -10.8 -3.6 0.0 8.6 12.1 -7.5 -7.6 -1.5 2018 168.24 133.88 150.11 172.72 150.91 170.07 0.00 99.50 111.40 169.30 136.17 151.68 10.1 10.8 7.8 12.9 12.3 7.3 0.0 1.2 4.3 10.7 11.7 7.9 2019 150.18 121.91 142.46 166.25 140.41 157.51 0.00 87.89 111.52 151.81 122.12 142.56 -10.7 -8.9 -5.1 -3.7 -7.0 -7.4 0.0 -11.7 0.1 -10.3 -10.3 -6.0

Running 12 Month 2017 179.56 137.90 156.26 159.89 149.88 166.47 0.00 103.82 104.20 174.55 138.93 155.75 1.8 -0.7 2.9 4.9 1.9 3.0 0.0 5.6 10.0 2.1 -0.3 2.8 2018 172.41 142.16 161.54 166.36 152.75 171.14 0.00 107.33 112.11 171.31 143.25 160.82 -4.0 3.1 3.4 4.0 1.9 2.8 0.0 3.4 7.6 -1.9 3.1 3.3 2019 174.41 141.61 160.80 175.97 157.76 173.51 0.00 105.24 114.24 174.69 142.82 160.61 1.2 -0.4 -0.5 5.8 3.3 1.4 0.0 -1.9 1.9 2.0 -0.3 -0.1

The STR STAR Report is a publication of STR, Inc. and STR Global, Ltd., and is intended solely for use by paid subscribers. Reproduction or distribution of the STR STAR Report, in whole or part, without written permission is prohibited and subject to legal action. If you have received this report and are NOT a subscriber to the STR STAR Report, please contact us immediately. Source: 2020 STR, Inc. / STR Global, Ltd. trading as “STR”. Tab 11 - Segmentation RevPAR Analysis Residence Inn San Diego Mission Valley 1865 Hotel Cir S San Diego, CA 92108-3319 Phone: (619) 881-3600 STR # 45777 ChainID: SANHC MgtCo: Island Hospitality Management Owner: Chatham Lodging Trust Market Scale: San Diego, CA Upscale Chains For the Month of: December 2019 Date Created: January 17, 2020 Monthly Competitive Set Data Excludes Subject Property

RevPAR Percent Change (%) Transient Group Contract Total Transient Group Contract Total Current Market Market Market Market Market Market Market Market Month My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale 2018 Jul 176.01 121.11 141.50 26.10 45.80 34.70 0.00 0.59 4.99 202.12 167.49 181.19 4.0 -3.6 1.0 -22.5 14.1 4.2 0.0 -36.9 18.0 -0.4 0.5 2.0 Aug 129.97 118.51 127.60 36.86 17.64 20.64 0.00 0.94 4.73 166.83 137.10 152.96 -10.2 2.1 4.3 28.7 17.0 -3.3 0.0 -43.8 21.2 -3.8 3.3 3.7 Sep 116.77 102.40 106.31 20.31 13.96 20.54 0.00 1.32 4.30 137.08 117.68 131.15 8.9 9.9 4.4 -50.3 -0.3 -1.2 0.0 -33.7 17.2 -7.4 7.8 3.9 Oct 128.83 99.78 106.13 29.62 17.59 23.97 0.00 2.33 3.97 158.45 119.70 134.07 34.1 1.2 9.6 -38.6 66.0 21.6 0.0 140.0 17.8 9.8 8.6 11.8 Nov 113.21 86.15 95.31 45.93 24.32 23.25 0.00 1.44 4.12 159.14 111.91 122.68 70.3 -0.7 12.4 15.4 79.0 4.0 0.0 161.5 12.8 49.7 10.9 10.7 Dec 97.89 70.67 79.94 32.89 21.35 20.51 0.00 1.05 4.01 130.78 93.06 104.46 51.5 -10.5 6.9 33.7 281.2 153.6 0.0 62.4 8.8 46.6 9.2 20.7 2019 Jan 114.18 84.87 88.37 26.05 19.07 22.76 0.00 1.04 3.83 140.24 104.97 114.95 76.5 3.4 7.2 112.7 118.2 71.6 0.0 453.7 8.6 82.2 15.4 15.9 Feb 106.54 82.33 104.62 55.30 32.51 22.47 0.00 1.59 3.99 161.84 116.43 131.08 -10.4 -22.5 -2.9 296.7 124.9 8.1 0.0 392.8 21.5 21.8 -3.7 -0.6 Mar 121.55 110.25 112.18 44.73 10.45 19.95 0.00 2.08 4.28 166.28 122.77 136.42 -14.0 -1.9 -0.6 733.2 -37.7 -1.7 0.0 61.6 9.6 13.4 -5.9 -0.5 Apr 125.45 105.48 113.10 26.06 12.39 18.45 0.00 3.17 4.05 151.50 121.04 135.60 3.1 -5.4 4.0 202.8 30.2 4.4 0.0 142.9 0.9 16.2 -1.1 3.9 May 130.57 91.01 101.49 12.00 18.75 21.79 0.00 1.39 3.76 142.57 111.15 127.04 24.6 -16.7 -3.5 -68.2 84.2 -2.9 0.0 -14.7 -9.3 0.1 -8.2 -3.6 Jun 160.15 120.83 128.48 23.22 25.33 30.17 0.00 2.44 4.20 183.37 148.60 162.85 20.1 -0.7 3.9 -45.9 -2.7 6.5 0.0 96.7 -20.5 4.0 -0.2 3.6 Jul 167.82 122.04 141.24 38.60 36.77 33.20 0.00 2.77 4.65 206.42 161.58 179.09 -4.7 0.8 -0.2 47.9 -19.7 -4.3 0.0 373.6 -6.8 2.1 -3.5 -1.2 Aug 127.97 118.25 123.03 41.80 10.38 20.04 0.00 1.55 4.15 169.77 130.18 147.22 -1.5 -0.2 -3.6 13.4 -41.1 -2.9 0.0 64.8 -12.1 1.8 -5.0 -3.8 Sep 122.01 99.24 102.99 22.91 11.94 22.51 0.00 2.13 3.86 144.92 113.31 129.37 4.5 -3.1 -3.1 12.8 -14.5 9.6 0.0 61.6 -10.3 5.7 -3.7 -1.4 Oct 107.89 82.19 97.58 16.40 14.11 16.90 0.00 3.61 4.18 124.29 99.91 118.65 -16.3 -17.6 -8.1 -44.6 -19.8 -29.5 0.0 54.8 5.2 -21.6 -16.5 -11.5 Nov 123.30 87.68 92.12 7.81 9.58 14.54 0.00 1.65 4.17 131.11 98.90 110.83 8.9 1.8 -3.3 -83.0 -60.6 -37.5 0.0 14.1 1.1 -17.6 -11.6 -9.7 Dec 57.79 70.42 76.90 11.45 1.29 7.82 0.00 2.00 4.31 69.24 73.70 89.03 -41.0 -0.4 -3.8 -65.2 -94.0 -61.8 0.0 90.5 7.6 -47.1 -20.8 -14.8

Year To Date 2017 114.48 100.04 102.33 34.77 16.54 21.66 0.00 1.36 3.49 149.26 117.94 127.48 -8.0 1.8 4.9 19.5 -7.7 5.0 0.0 -2.0 31.2 -1.9 0.3 5.5 2018 120.63 103.44 108.14 26.10 18.90 22.21 0.00 1.14 4.20 146.74 123.48 134.56 5.4 3.4 5.7 -24.9 14.3 2.6 0.0 -16.2 20.2 -1.7 4.7 5.6 2019 121.94 97.95 106.70 27.00 16.78 20.81 0.00 2.12 4.12 148.94 116.84 131.63 1.1 -5.3 -1.3 3.4 -11.3 -6.3 0.0 85.8 -1.8 1.5 -5.4 -2.2

Running 3 Month 2017 75.80 88.14 85.46 37.54 9.89 16.66 0.00 0.72 3.57 113.33 98.76 105.69 -35.2 7.8 1.3 102.1 -47.5 -13.0 0.0 -17.1 32.6 -16.3 -2.7 -0.4 2018 113.31 85.52 93.78 36.04 21.05 22.57 0.00 1.61 4.03 149.35 108.18 120.38 49.5 -3.0 9.7 -4.0 112.9 35.4 0.0 122.1 13.0 31.8 9.5 13.9 2019 95.62 80.01 88.77 11.93 8.31 13.05 0.00 2.43 4.22 107.55 90.75 106.04 -15.6 -6.4 -5.3 -66.9 -60.5 -42.2 0.0 50.8 4.6 -28.0 -16.1 -11.9

Running 12 Month 2017 114.48 100.04 102.33 34.77 16.54 21.66 0.00 1.36 3.49 149.26 117.94 127.48 -8.0 1.8 4.9 19.5 -7.7 5.0 0.0 -2.0 31.2 -1.9 0.3 5.5 2018 120.63 103.44 108.14 26.10 18.90 22.21 0.00 1.14 4.20 146.74 123.48 134.56 5.4 3.4 5.7 -24.9 14.3 2.6 0.0 -16.2 20.2 -1.7 4.7 5.6 2019 121.94 97.95 106.70 27.00 16.78 20.81 0.00 2.12 4.12 148.94 116.84 131.63 1.1 -5.3 -1.3 3.4 -11.3 -6.3 0.0 85.8 -1.8 1.5 -5.4 -2.2

The STR STAR Report is a publication of STR, Inc. and STR Global, Ltd., and is intended solely for use by paid subscribers. Reproduction or distribution of the STR STAR Report, in whole or part, without written permission is prohibited and subject to legal action. If you have received this report and are NOT a subscriber to the STR STAR Report, please contact us immediately. Source: 2020 STR, Inc. / STR Global, Ltd. trading as “STR”. Tab 12 - Segmentation Index Analysis Residence Inn San Diego Mission Valley 1865 Hotel Cir S San Diego, CA 92108-3319 Phone: (619) 881-3600 STR # 45777 ChainID: SANHC MgtCo: Island Hospitality Management Owner: Chatham Lodging Trust For the Month of: December 2019 Date Created: January 17, 2020 Monthly Competitive Set Data Excludes Subject Property

Indexes Percent Change (%) Transient Group Contract Total Transient Group Contract Total Current Month Occ ADR RevPAR Occ ADR RevPAR Occ ADR RevPAR Occ ADR RevPAR Occ ADR RevPAR Occ ADR RevPAR Occ ADR RevPAR Occ ADR RevPAR 2018 Jul 123.4 117.8 145.3 59.2 96.3 57.0 0.0 0.0 0.0 105.9 114.0 120.7 18.3 -8.9 7.8 -33.8 2.4 -32.1 0.0 0.0 0.0 5.9 -6.4 -0.9 Aug 93.7 117.1 109.7 203.4 102.7 208.9 0.0 0.0 0.0 106.9 113.8 121.7 -3.4 -9.0 -12.1 8.1 1.7 10.0 0.0 0.0 0.0 1.4 -8.1 -6.8 Sep 97.9 116.5 114.0 126.5 115.0 145.5 0.0 0.0 0.0 100.0 116.5 116.5 5.1 -5.7 -0.9 -51.2 2.3 -50.1 0.0 0.0 0.0 -11.2 -3.3 -14.1 Oct 106.9 120.8 129.1 142.4 118.2 168.4 0.0 0.0 0.0 109.1 121.3 132.4 39.1 -4.7 32.6 -64.2 3.3 -63.0 0.0 0.0 0.0 2.0 -0.9 1.1 Nov 105.5 124.5 131.4 167.0 113.1 188.9 0.0 0.0 0.0 116.0 122.5 142.2 63.4 5.0 71.6 -34.5 -1.6 -35.5 0.0 0.0 0.0 33.1 1.5 35.1 Dec 103.6 133.7 138.5 135.9 113.4 154.1 0.0 0.0 0.0 108.0 130.1 140.5 66.1 2.0 69.3 -64.9 -0.1 -64.9 0.0 0.0 0.0 35.9 -1.2 34.2 2019 Jan 106.6 126.2 134.5 104.4 130.9 136.6 0.0 0.0 0.0 104.8 127.4 133.6 57.5 8.4 70.7 -6.3 4.0 -2.5 0.0 0.0 0.0 46.5 7.9 58.0 Feb 99.3 130.4 129.4 157.8 107.8 170.1 0.0 0.0 0.0 112.4 123.7 139.0 6.7 8.3 15.5 92.1 -8.2 76.4 0.0 0.0 0.0 22.8 3.0 26.5 Mar 87.4 126.1 110.3 348.0 123.0 428.2 0.0 0.0 0.0 107.6 125.9 135.4 -15.0 3.1 -12.3 1205.4 2.5 1237.6 0.0 0.0 0.0 17.4 2.6 20.5 Apr 99.9 119.1 118.9 169.1 124.3 210.2 0.0 0.0 0.0 103.3 121.1 125.2 10.6 -1.5 9.0 132.5 0.1 132.6 0.0 0.0 0.0 18.1 -0.5 17.5 May 120.2 119.4 143.5 56.1 113.9 64.0 0.0 0.0 0.0 108.5 118.2 128.3 46.1 2.5 49.7 -82.9 1.3 -82.7 0.0 0.0 0.0 6.7 2.2 9.1 Jun 109.2 121.4 132.5 85.8 106.8 91.7 0.0 0.0 0.0 103.0 119.8 123.4 19.5 1.2 20.9 -45.2 1.5 -44.4 0.0 0.0 0.0 1.2 3.0 4.2 Jul 112.8 121.9 137.5 103.4 101.5 105.0 0.0 0.0 0.0 108.6 117.7 127.7 -8.6 3.5 -5.4 74.7 5.4 84.2 0.0 0.0 0.0 2.5 3.2 5.9 Aug 88.6 122.1 108.2 384.8 104.6 402.5 0.0 0.0 0.0 109.2 119.5 130.4 -5.4 4.3 -1.3 89.2 1.8 92.7 0.0 0.0 0.0 2.1 5.0 7.2 Sep 101.9 120.6 122.9 155.5 123.4 191.9 0.0 0.0 0.0 105.4 121.4 127.9 4.1 3.6 7.8 22.9 7.3 31.9 0.0 0.0 0.0 5.4 4.2 9.8 Oct 106.6 123.1 131.3 96.3 120.7 116.2 0.0 0.0 0.0 99.9 124.5 124.4 -0.2 1.9 1.7 -32.4 2.1 -31.0 0.0 0.0 0.0 -8.4 2.6 -6.0 Nov 116.3 121.0 140.6 71.5 114.1 81.6 0.0 0.0 0.0 109.6 120.9 132.6 10.1 -2.8 7.0 -57.2 0.9 -56.8 0.0 0.0 0.0 -5.5 -1.3 -6.8 Dec 67.8 121.0 82.1 685.1 129.5 887.5 0.0 0.0 0.0 74.8 125.7 93.9 -34.5 -9.5 -40.8 404.2 14.2 476.0 0.0 0.0 0.0 -30.8 -3.4 -33.1

Year To Date 2017 87.9 130.2 114.4 197.1 106.7 210.2 0.0 0.0 0.0 100.7 125.6 126.6 -11.8 2.5 -9.6 25.8 2.9 29.5 0.0 0.0 0.0 -4.6 2.4 -2.2 2018 96.2 121.3 116.6 126.8 108.9 138.1 0.0 0.0 0.0 99.4 119.6 118.8 9.4 -6.9 1.9 -35.7 2.1 -34.3 0.0 0.0 0.0 -1.3 -4.8 -6.1 2019 101.1 123.2 124.5 144.3 111.5 160.9 0.0 0.0 0.0 104.2 122.3 127.5 5.1 1.5 6.7 13.8 2.4 16.6 0.0 0.0 0.0 4.9 2.3 7.3

Running 3 Month 2017 68.0 126.5 86.0 333.5 113.8 379.6 0.0 0.0 0.0 91.5 125.4 114.8 -38.6 -2.0 -39.8 256.6 7.9 284.9 0.0 0.0 0.0 -14.1 0.1 -14.0 2018 105.4 125.7 132.5 149.6 114.4 171.2 0.0 0.0 0.0 111.0 124.3 138.1 55.1 -0.6 54.1 -55.1 0.6 -54.9 0.0 0.0 0.0 21.4 -0.9 20.3 2019 97.0 123.2 119.5 121.2 118.4 143.5 0.0 0.0 0.0 95.3 124.3 118.5 -8.0 -2.0 -9.8 -19.0 3.5 -16.2 0.0 0.0 0.0 -14.1 0.0 -14.2

Running 12 Month 2017 87.9 130.2 114.4 197.1 106.7 210.2 0.0 0.0 0.0 100.7 125.6 126.6 -11.8 2.5 -9.6 25.8 2.9 29.5 0.0 0.0 0.0 -4.6 2.4 -2.2 2018 96.2 121.3 116.6 126.8 108.9 138.1 0.0 0.0 0.0 99.4 119.6 118.8 9.4 -6.9 1.9 -35.7 2.1 -34.3 0.0 0.0 0.0 -1.3 -4.8 -6.1 2019 101.1 123.2 124.5 144.3 111.5 160.9 0.0 0.0 0.0 104.2 122.3 127.5 5.1 1.5 6.7 13.8 2.4 16.6 0.0 0.0 0.0 4.9 2.3 7.3

The STR STAR Report is a publication of STR, Inc. and STR Global, Ltd., and is intended solely for use by paid subscribers. Reproduction or distribution of the STR STAR Report, in whole or part, without written permission is prohibited and subject to legal action. If you have received this report and are NOT a subscriber to the STR STAR Report, please contact us immediately. Source: 2020 STR, Inc. / STR Global, Ltd. trading as “STR”. Tab 13 - Segmentation Ranking Analysis Residence Inn San Diego Mission Valley 1865 Hotel Cir S San Diego, CA 92108-3319 Phone: (619) 881-3600 STR # 45777 ChainID: SANHC MgtCo: Island Hospitality Management Owner: Chatham Lodging Trust For the Month of: December 2019 Date Created: January 17, 2020 Monthly Competitive Set Data Excludes Subject Property

Ranking Percent Change (%) Transient Group Contract Total Transient Group Contract Total Current Month Occ ADR RevPAR Occ ADR RevPAR Occ ADR RevPAR Occ ADR RevPAR Occ ADR RevPAR Occ ADR RevPAR Occ ADR RevPAR Occ ADR RevPAR 2018 Jul 1 of 4 2 of 4 2 of 4 4 of 4 3 of 4 4 of 4 2 of 7 4 of 7 2 of 7 1 of 4 4 of 4 1 of 4 4 of 4 2 of 4 4 of 4 3 of 7 7 of 7 5 of 7 Aug 3 of 4 2 of 4 3 of 4 1 of 4 3 of 4 1 of 4 2 of 7 3 of 7 3 of 7 3 of 4 4 of 4 3 of 4 2 of 4 2 of 4 2 of 4 2 of 7 7 of 7 6 of 7 Sep 3 of 4 1 of 4 2 of 4 2 of 4 1 of 4 2 of 4 5 of 7 2 of 7 4 of 7 2 of 4 4 of 4 3 of 4 4 of 4 3 of 4 4 of 4 7 of 7 7 of 7 7 of 7 Oct 1 of 4 1 of 4 1 of 4 2 of 4 1 of 4 2 of 4 2 of 7 1 of 7 1 of 7 1 of 4 4 of 4 1 of 4 4 of 4 2 of 4 4 of 4 3 of 7 6 of 7 3 of 7 Nov 2 of 4 1 of 4 2 of 4 1 of 4 2 of 4 1 of 4 1 of 7 1 of 7 1 of 7 1 of 4 3 of 4 1 of 4 3 of 4 4 of 4 3 of 4 1 of 7 4 of 7 1 of 7 Dec 2 of 4 1 of 4 2 of 4 1 of 4 1 of 4 1 of 4 4 of 7 1 of 7 1 of 7 1 of 4 2 of 4 1 of 4 4 of 4 3 of 4 4 of 4 1 of 7 4 of 7 1 of 7 2019 Jan 3 of 4 1 of 4 2 of 4 3 of 4 1 of 4 1 of 4 4 of 7 2 of 7 3 of 7 1 of 4 1 of 4 1 of 4 2 of 4 2 of 4 2 of 4 1 of 7 1 of 7 1 of 7 Feb 3 of 4 1 of 4 2 of 4 2 of 4 2 of 4 2 of 4 2 of 7 1 of 7 1 of 7 3 of 4 1 of 4 2 of 4 1 of 4 4 of 4 2 of 4 1 of 7 2 of 7 1 of 7 Mar 4 of 4 1 of 4 2 of 4 1 of 4 2 of 4 1 of 4 2 of 7 1 of 7 2 of 7 4 of 4 1 of 4 4 of 4 1 of 4 1 of 4 1 of 4 1 of 7 1 of 7 1 of 7 Apr 2 of 4 2 of 4 2 of 4 1 of 4 2 of 4 1 of 4 3 of 7 3 of 7 3 of 7 1 of 4 3 of 4 2 of 4 2 of 4 3 of 4 2 of 4 1 of 7 5 of 7 1 of 7 May 2 of 4 2 of 4 2 of 4 4 of 4 2 of 4 4 of 4 2 of 7 3 of 7 3 of 7 1 of 4 2 of 4 1 of 4 4 of 4 2 of 4 4 of 4 1 of 7 2 of 7 1 of 7 Jun 2 of 4 2 of 4 1 of 4 3 of 4 2 of 4 3 of 4 4 of 7 2 of 7 2 of 7 1 of 4 2 of 4 1 of 4 4 of 4 2 of 4 4 of 4 6 of 7 3 of 7 3 of 7 Jul 2 of 4 2 of 4 2 of 4 2 of 4 2 of 4 2 of 4 2 of 7 2 of 7 2 of 7 4 of 4 1 of 4 4 of 4 1 of 4 1 of 4 1 of 4 3 of 7 2 of 7 1 of 7 Aug 4 of 4 2 of 4 2 of 4 1 of 4 2 of 4 1 of 4 3 of 7 2 of 7 2 of 7 4 of 4 2 of 4 3 of 4 2 of 4 2 of 4 1 of 4 4 of 7 1 of 7 1 of 7 Sep 3 of 4 1 of 4 2 of 4 1 of 4 2 of 4 1 of 4 4 of 7 1 of 7 3 of 7 3 of 4 2 of 4 2 of 4 3 of 4 3 of 4 3 of 4 2 of 7 1 of 7 1 of 7 Oct 3 of 4 1 of 4 2 of 4 2 of 4 1 of 4 2 of 4 4 of 7 2 of 7 3 of 7 3 of 4 2 of 4 2 of 4 2 of 4 1 of 4 2 of 4 6 of 7 3 of 7 5 of 7 Nov 2 of 4 1 of 4 1 of 4 4 of 4 1 of 4 3 of 4 3 of 7 2 of 7 3 of 7 1 of 4 3 of 4 1 of 4 4 of 4 2 of 4 4 of 4 6 of 7 4 of 7 6 of 7 Dec 4 of 4 2 of 4 3 of 4 1 of 4 1 of 4 1 of 4 7 of 7 2 of 7 4 of 7 4 of 4 4 of 4 4 of 4 1 of 4 1 of 4 1 of 4 7 of 7 6 of 7 7 of 7

Year To Date 2017 4 of 4 1 of 4 2 of 4 1 of 4 2 of 4 1 of 4 5 of 7 1 of 7 3 of 7 4 of 4 1 of 4 4 of 4 2 of 4 1 of 4 1 of 4 7 of 7 2 of 7 5 of 7 2018 3 of 4 1 of 4 2 of 4 1 of 4 2 of 4 1 of 4 5 of 7 2 of 7 3 of 7 1 of 4 4 of 4 1 of 4 4 of 4 1 of 4 4 of 4 5 of 7 7 of 7 6 of 7 2019 3 of 4 1 of 4 2 of 4 1 of 4 2 of 4 1 of 4 4 of 7 1 of 7 3 of 7 2 of 4 2 of 4 2 of 4 2 of 4 2 of 4 2 of 4 2 of 7 1 of 7 1 of 7

Running 3 Month 2017 4 of 4 1 of 4 4 of 4 1 of 4 1 of 4 1 of 4 6 of 7 2 of 7 3 of 7 4 of 4 2 of 4 4 of 4 1 of 4 1 of 4 1 of 4 7 of 7 4 of 7 7 of 7 2018 2 of 4 1 of 4 2 of 4 1 of 4 1 of 4 1 of 4 2 of 7 1 of 7 1 of 7 1 of 4 3 of 4 1 of 4 4 of 4 3 of 4 4 of 4 1 of 7 5 of 7 1 of 7 2019 3 of 4 1 of 4 2 of 4 2 of 4 1 of 4 1 of 4 5 of 7 2 of 7 4 of 7 3 of 4 3 of 4 3 of 4 3 of 4 1 of 4 3 of 4 7 of 7 3 of 7 6 of 7

Running 12 Month 2017 4 of 4 1 of 4 2 of 4 1 of 4 2 of 4 1 of 4 5 of 7 1 of 7 3 of 7 4 of 4 1 of 4 4 of 4 2 of 4 1 of 4 1 of 4 7 of 7 2 of 7 5 of 7 2018 3 of 4 1 of 4 2 of 4 1 of 4 2 of 4 1 of 4 5 of 7 2 of 7 3 of 7 1 of 4 4 of 4 1 of 4 4 of 4 1 of 4 4 of 4 5 of 7 7 of 7 6 of 7 2019 3 of 4 1 of 4 2 of 4 1 of 4 2 of 4 1 of 4 4 of 7 1 of 7 3 of 7 2 of 4 2 of 4 2 of 4 2 of 4 2 of 4 2 of 4 2 of 7 1 of 7 1 of 7

The STR STAR Report is a publication of STR, Inc. and STR Global, Ltd., and is intended solely for use by paid subscribers. Reproduction or distribution of the STR STAR Report, in whole or part, without written permission is prohibited and subject to legal action. If you have received this report and are NOT a subscriber to the STR STAR Report, please contact us immediately. Source: 2020 STR, Inc. / STR Global, Ltd. trading as “STR”. Tab 14 - Segmentation Day Of Week - Current Month Residence Inn San Diego Mission Valley 1865 Hotel Cir S San Diego, CA 92108-3319 Phone: (619) 881-3600 STR # 45777 ChainID: SANHC MgtCo: Island Hospitality Management Owner: Chatham Lodging Trust Market Scale: San Diego, CA Upscale Chains For the Month of: December 2019 Date Created: January 17, 2020 Monthly Competitive Set Data Excludes Subject Property

Current Month Percent Change (%) TransientGroup Contract Total Transient Group Contract Total Market Market Market Market Market Market Market Market My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale

Occupancy (%) Sunday 37.3 53.0 46.9 6.4 0.7 4.1 0.0 2.6 4.2 38.6 56.3 55.3 -35.8 6.2 -7.4 -67.2 -96.1 -70.0 0.0 91.4 8.2 -51.8 -19.0 -19.1 Monday 38.3 59.0 53.5 6.4 0.8 5.1 0.0 2.0 4.3 52.8 61.7 63.0 -37.9 0.0 -9.5 -56.2 -95.2 -62.9 0.0 38.0 9.3 -36.4 -19.1 -18.1 Tuesday 45.5 64.9 60.3 7.8 0.8 6.1 0.0 1.4 4.6 62.9 67.1 71.0 -15.3 9.7 0.0 -59.4 -91.8 -31.5 0.0 303.8 15.9 -16.5 -2.7 -3.0 Wednesday 42.8 66.8 60.1 8.8 1.3 6.5 0.0 1.8 4.3 57.1 69.9 70.9 -25.3 5.0 -3.7 -43.4 -82.5 -22.4 0.0 242.7 3.3 -24.1 -2.5 -5.4 Thursday 39.5 64.7 58.7 5.2 0.4 7.5 0.0 2.6 4.4 49.6 67.7 70.6 -31.3 6.2 -0.4 -66.2 -95.3 -16.4 0.0 142.5 11.1 -34.4 -4.3 -1.8 Weekday 61.3 55.6 0.8 5.8 2.1 4.4 52.1 64.2 65.7 5.5 -4.1 -93.6 -47.7 108.7 9.7 -33.4 -10.3 -9.9

Friday 68.8 60.0 3.0 6.2 2.1 4.3 42.9 73.8 70.6 9.9 5.2 -66.3 -42.1 80.3 4.9 -42.4 1.8 -1.9 Saturday 71.5 61.5 0.1 6.1 4.1 4.0 45.3 75.8 71.6 23.0 3.1 -99.4 -62.3 261.4 -2.8 -47.2 -5.4 -10.5 Weekend 70.2 60.8 1.5 6.2 3.1 4.2 44.1 74.8 71.1 16.7 3.9 -90.0 -55.2 171.1 1.0 -45.4 -2.5 -7.0

Total 43.1 63.5 57.9 7.0 1.0 5.5 0.0 2.5 3.7 50.0 66.9 67.1 -29.1 8.2 -0.9 -61.6 -92.4 -53.6 0.0 131.9 1.4 -36.6 -8.4 -9.3

ADR Sunday 131.11 108.16 124.07 159.02 127.95 146.69 0.00 71.86 116.19 135.19 106.75 125.16 -21.6 -12.8 -11.1 -16.9 -21.5 -20.8 0.0 -23.3 6.1 -22.0 -20.2 -14.9 Monday 131.04 109.89 132.18 164.28 125.67 150.03 0.00 78.48 118.57 135.81 109.06 132.68 -15.8 -16.8 -11.4 -3.9 -23.3 -17.3 0.0 -18.2 5.6 -22.3 -21.0 -13.3 Tuesday 131.83 111.16 138.95 163.03 122.66 152.16 0.00 92.41 110.41 136.39 110.89 138.24 -14.6 -8.0 1.4 -4.8 -19.9 -12.2 0.0 -5.8 -2.0 -14.1 -11.4 -1.4 Wednesday 127.48 111.08 139.12 167.06 118.89 155.93 0.00 73.40 111.14 134.21 110.28 138.97 -16.1 -6.7 2.6 -1.3 -11.7 2.3 0.0 -22.9 -1.3 -13.7 -8.5 2.0 Thursday 139.53 113.15 133.84 157.62 118.71 142.31 0.00 78.23 115.40 141.65 111.85 133.60 -9.3 -1.5 2.8 -6.9 -12.9 -7.0 0.0 -16.8 -2.9 -9.9 -4.6 0.9 Weekday 110.68 133.90 122.87 149.41 77.97 114.38 136.52 109.78 133.96 -9.7 -3.6 -20.9 -13.7 -17.9 1.2 -17.3 -14.2 -6.1

Friday 114.37 132.67 130.12 139.81 89.83 111.41 149.32 114.32 132.00 -1.0 5.7 1.6 -1.6 -11.8 0.3 -7.1 -2.1 3.8 Saturday 109.14 125.94 133.20 136.72 83.47 115.25 140.38 107.78 126.26 -11.3 -10.3 -17.8 -21.1 -18.8 3.0 -18.1 -18.9 -13.3 Weekend 111.70 129.27 130.25 138.28 85.58 113.26 144.73 111.00 129.11 -6.5 -3.5 -15.1 -14.9 -16.4 1.5 -13.4 -12.0 -6.4

Total 134.23 110.98 132.77 164.00 126.61 141.39 0.00 81.42 117.37 138.39 110.13 132.64 -16.7 -7.9 -2.9 -9.4 -20.7 -17.8 0.0 -17.8 6.1 -16.5 -13.5 -6.1

RevPAR Sunday 48.84 57.34 58.16 10.15 0.91 6.07 0.00 1.85 4.92 52.25 60.10 69.16 -49.7 -7.5 -17.7 -72.7 -96.9 -76.3 0.0 46.8 14.8 -62.4 -35.3 -31.2 Monday 50.16 64.78 70.74 10.53 0.96 7.64 0.00 1.58 5.16 71.68 67.33 83.53 -47.7 -16.8 -19.8 -57.9 -96.3 -69.3 0.0 12.9 15.4 -50.6 -36.1 -29.0 Tuesday 59.93 72.12 83.73 12.68 0.96 9.34 0.00 1.32 5.10 85.75 74.40 98.17 -27.7 0.9 1.4 -61.3 -93.4 -39.8 0.0 280.4 13.5 -28.3 -13.8 -4.3 Wednesday 54.61 74.25 83.64 14.66 1.57 10.11 0.00 1.30 4.73 76.69 77.12 98.49 -37.3 -2.0 -1.2 -44.1 -84.6 -20.6 0.0 164.1 1.9 -34.5 -10.8 -3.5 Thursday 55.16 73.22 78.61 8.26 0.49 10.69 0.00 2.03 5.03 70.22 75.75 94.33 -37.8 4.6 2.4 -68.5 -95.9 -22.3 0.0 101.8 7.9 -40.8 -8.7 -0.9 Weekday 67.87 74.44 0.97 8.63 1.61 5.00 71.13 70.46 88.07 -4.8 -7.5 -95.0 -54.8 71.4 11.1 -44.9 -23.0 -15.4

Friday 78.65 79.67 3.85 8.73 1.84 4.82 64.04 84.35 93.22 8.9 11.2 -65.7 -43.0 59.0 5.2 -46.5 -0.4 1.8 Saturday 78.09 77.39 0.17 8.37 3.46 4.63 63.57 81.71 90.39 9.2 -7.5 -99.5 -70.3 193.4 0.1 -56.8 -23.3 -22.4 Weekend 78.37 78.53 2.01 8.55 2.65 4.73 63.80 83.03 91.81 9.1 0.3 -91.5 -61.9 126.5 2.6 -52.7 -14.2 -12.9

Total 57.79 70.42 76.90 11.45 1.29 7.82 0.00 2.00 4.31 69.24 73.70 89.03 -41.0 -0.4 -3.8 -65.2 -94.0 -61.8 0.0 90.5 7.6 -47.1 -20.8 -14.8

The STR STAR Report is a publication of STR, Inc. and STR Global, Ltd., and is intended solely for use by paid subscribers. Reproduction or distribution of the STR STAR Report, in whole or part, without written permission is prohibited and subject to legal action. If you have received this report and are NOT a subscriber to the STR STAR Report, please contact us immediately. Source: 2020 STR, Inc. / STR Global, Ltd. trading as “STR”. Tab 15 - Segmentation Day Of Week - Year to Date Residence Inn San Diego Mission Valley 1865 Hotel Cir S San Diego, CA 92108-3319 Phone: (619) 881-3600 STR # 45777 ChainID: SANHC MgtCo: Island Hospitality Management Owner: Chatham Lodging Trust Market Scale: San Diego, CA Upscale Chains For the Month of: December 2019 Date Created: January 17, 2020 Monthly Competitive Set Data Excludes Subject Property

Year To Date Percent Change (%) TransientGroup Contract Total Transient Group Contract Total Market Market Market Market Market Market Market Market My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale

Occupancy (%) Sunday 62.7 59.7 56.2 14.3 8.8 10.3 0.0 1.6 3.9 76.2 70.2 70.4 -3.0 -7.9 -1.8 -5.5 -8.8 -4.1 0.0 85.0 -1.2 -4.9 -6.9 -2.1 Monday 66.1 67.7 63.6 15.1 8.5 11.8 0.0 1.3 4.0 82.6 77.6 79.4 -3.4 -6.6 -1.7 1.6 -9.8 -3.1 0.0 52.7 -4.8 -1.4 -6.3 -2.1 Tuesday 69.9 72.1 67.9 15.5 8.9 12.6 0.0 1.2 4.1 86.9 82.2 84.6 -0.8 -4.5 -0.9 -5.5 -16.1 -2.4 0.0 37.4 -3.6 -0.2 -5.5 -1.3 Wednesday 71.5 72.9 68.2 15.9 9.8 13.1 0.0 1.6 4.0 88.2 84.3 85.4 0.6 -1.8 -1.1 1.4 -25.1 -2.6 0.0 69.2 -6.6 1.3 -4.5 -1.6 Thursday 70.4 68.9 64.8 15.4 11.2 12.9 0.0 1.9 4.1 86.5 82.1 81.8 0.9 -4.8 -1.2 -5.8 -17.5 -9.4 0.0 67.2 -5.2 0.3 -5.9 -2.8 Weekday 68.2 68.3 64.2 15.2 9.5 12.1 0.0 1.5 4.0 84.1 79.3 80.3 -1.1 -5.0 -1.3 -2.8 -16.2 -4.4 0.0 62.8 -4.3 -0.9 -5.8 -1.9

Friday 72.5 69.8 66.7 16.0 13.4 13.0 0.0 2.8 4.0 86.7 86.0 83.6 3.4 -5.5 -0.3 0.2 -10.7 -13.1 0.0 125.1 -2.7 0.4 -4.5 -2.6 Saturday 76.5 73.5 71.6 15.2 13.3 12.7 0.0 3.5 4.2 89.8 90.4 88.4 3.7 -5.0 0.2 1.0 -4.2 -13.0 0.0 147.9 -0.9 0.8 -2.6 -2.0 Weekend 74.5 71.7 69.1 15.6 13.4 12.8 0.0 3.2 4.1 88.2 88.2 86.0 3.6 -5.3 0.0 0.5 -7.6 -13.0 0.0 137.3 -1.8 0.6 -3.5 -2.3

Total 69.9 69.2 66.4 15.3 10.6 12.0 0.0 2.0 3.6 85.3 81.8 82.0 -0.1 -4.9 -0.9 -2.2 -14.1 -7.6 0.0 89.4 -3.6 -0.5 -5.1 -2.0

ADR Sunday 168.12 132.45 149.01 169.57 157.06 177.13 0.00 93.29 114.72 168.39 134.64 151.19 0.9 -0.4 -0.5 1.5 1.4 1.8 0.0 -14.7 2.1 1.0 -0.7 -0.1 Monday 177.75 141.93 164.55 174.92 156.17 176.92 0.00 103.76 113.89 177.22 142.88 163.84 3.0 1.3 1.4 6.8 0.8 3.1 0.0 -1.0 0.8 2.9 1.0 1.7 Tuesday 174.32 145.70 170.41 178.29 153.33 176.53 0.00 104.21 114.61 175.04 145.91 168.63 0.6 1.5 0.9 9.0 2.5 2.5 0.0 -2.4 0.6 2.1 1.4 1.2 Wednesday 176.33 146.55 170.57 177.87 160.36 175.86 0.00 105.05 115.77 176.61 147.37 168.79 2.0 0.6 1.2 7.8 5.6 3.1 0.0 -2.5 2.7 3.0 0.8 1.6 Thursday 175.64 141.43 159.14 175.36 158.82 170.59 0.00 103.41 114.64 175.59 142.92 158.74 2.7 -0.6 -1.2 4.5 5.5 0.4 0.0 -6.6 2.0 3.0 -0.2 -0.8 Weekday 174.57 141.97 163.28 175.34 157.29 175.30 0.00 101.79 114.73 174.71 143.02 162.67 1.9 0.6 0.4 6.0 3.4 2.2 0.0 -5.8 1.6 2.5 0.5 0.8

Friday 175.97 139.21 152.95 177.53 157.13 170.08 0.00 105.54 112.28 176.25 140.90 153.68 1.1 -2.4 -2.8 6.2 2.9 0.5 0.0 -7.4 0.4 2.0 -2.1 -2.2 Saturday 172.13 142.88 157.98 177.96 157.20 170.59 0.00 110.52 115.22 173.09 143.72 157.77 -1.5 -2.3 -2.9 6.0 1.3 0.0 0.0 -3.5 3.8 -0.3 -2.3 -2.4 Weekend 174.00 141.09 155.55 177.74 157.16 170.33 0.00 108.31 113.79 174.64 142.35 155.78 -0.3 -2.4 -2.8 6.1 2.1 0.2 0.0 -5.2 2.1 0.8 -2.2 -2.3

Total 174.41 141.61 160.80 175.97 157.76 173.51 0.00 105.24 114.24 174.69 142.82 160.61 1.2 -0.4 -0.5 5.8 3.3 1.4 0.0 -1.9 1.9 2.0 -0.3 -0.1

RevPAR Sunday 105.49 79.09 83.79 24.25 13.84 18.19 0.00 1.52 4.52 128.27 94.45 106.50 -2.1 -8.3 -2.3 -4.1 -7.6 -2.4 0.0 57.9 0.8 -3.9 -7.5 -2.2 Monday 117.45 96.15 104.71 26.36 13.33 20.82 0.00 1.32 4.53 146.38 110.80 130.06 -0.5 -5.3 -0.3 8.5 -9.1 -0.1 0.0 51.2 -4.1 1.5 -5.4 -0.4 Tuesday 121.85 105.07 115.76 27.64 13.59 22.27 0.00 1.25 4.67 152.12 119.91 142.70 -0.2 -3.0 0.0 3.0 -14.0 0.1 0.0 34.2 -3.1 1.9 -4.1 -0.1 Wednesday 126.16 106.83 116.30 28.21 15.76 23.10 0.00 1.69 4.67 155.68 124.28 144.07 2.6 -1.2 0.0 9.3 -20.9 0.4 0.0 64.9 -4.1 4.4 -3.8 0.0 Thursday 123.61 97.47 103.18 26.96 17.83 22.06 0.00 1.98 4.66 151.85 117.29 129.90 3.6 -5.4 -2.4 -1.5 -12.9 -9.0 0.0 56.2 -3.3 3.3 -6.0 -3.6 Weekday 118.98 96.95 104.79 26.70 14.87 21.29 0.00 1.55 4.61 146.88 113.37 130.69 0.8 -4.5 -0.9 3.0 -13.4 -2.3 0.0 53.3 -2.8 1.5 -5.2 -1.2

Friday 127.52 97.17 101.99 28.49 21.09 22.05 0.00 2.98 4.44 152.78 121.23 128.47 4.5 -7.8 -3.0 6.3 -8.1 -12.6 0.0 108.4 -2.4 2.4 -6.5 -4.8 Saturday 131.72 105.06 113.08 27.00 20.90 21.64 0.00 3.91 4.82 155.42 129.88 139.54 2.1 -7.3 -2.7 7.0 -2.9 -13.0 0.0 139.2 2.9 0.4 -4.8 -4.3 Weekend 129.62 101.12 107.53 27.75 21.00 21.84 0.00 3.44 4.63 154.10 125.56 134.00 3.3 -7.5 -2.9 6.7 -5.6 -12.8 0.0 124.8 0.3 1.4 -5.7 -4.5

Total 121.94 97.95 106.70 27.00 16.78 20.81 0.00 2.12 4.12 148.94 116.84 131.63 1.1 -5.3 -1.3 3.4 -11.3 -6.3 0.0 85.8 -1.8 1.5 -5.4 -2.2

The STR STAR Report is a publication of STR, Inc. and STR Global, Ltd., and is intended solely for use by paid subscribers. Reproduction or distribution of the STR STAR Report, in whole or part, without written permission is prohibited and subject to legal action. If you have received this report and are NOT a subscriber to the STR STAR Report, please contact us immediately. Source: 2020 STR, Inc. / STR Global, Ltd. trading as “STR”. Tab 16 - Segmentation Day Of Week - Running 3 Month Residence Inn San Diego Mission Valley 1865 Hotel Cir S San Diego, CA 92108-3319 Phone: (619) 881-3600 STR # 45777 ChainID: SANHC MgtCo: Island Hospitality Management Owner: Chatham Lodging Trust Market Scale: San Diego, CA Upscale Chains For the Month of: December 2019 Date Created: January 17, 2020 Monthly Competitive Set Data Excludes Subject Property

Running 3 Month Percent Change (%) TransientGroup Contract Total Transient Group Contract Total Market Market Market Market Market Market Market Market My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale

Occupancy (%) Sunday 55.5 55.7 50.7 7.2 4.4 6.5 0.0 2.7 4.1 59.9 62.9 61.3 -11.4 4.4 -2.3 -64.7 -68.1 -44.5 0.0 86.0 5.8 -28.8 -8.5 -9.1 Monday 55.2 62.5 58.5 7.2 4.8 8.0 0.0 1.5 4.2 66.8 68.8 70.7 -17.4 -1.1 -3.7 -63.5 -63.3 -38.6 0.0 24.9 3.4 -24.3 -11.2 -9.1 Tuesday 61.4 67.7 64.1 7.5 5.4 8.6 0.0 1.2 4.4 73.4 74.3 77.1 -5.8 2.9 1.0 -65.3 -51.5 -29.8 0.0 28.5 11.6 -16.2 -4.6 -3.2 Wednesday 64.3 68.9 64.8 7.3 5.4 8.7 0.0 1.5 4.3 74.1 75.8 77.7 -4.0 2.2 0.1 -63.5 -52.2 -28.4 0.0 21.2 5.6 -15.8 -5.2 -3.9 Thursday 63.2 65.3 61.7 6.1 6.2 9.3 0.0 2.1 4.4 71.7 73.6 75.4 -5.1 -1.9 -1.8 -70.0 -52.3 -34.6 0.0 30.1 8.7 -18.5 -9.2 -7.0 Weekday 60.0 64.1 60.0 7.1 5.2 8.2 0.0 1.8 4.3 69.2 71.1 72.5 -8.6 1.3 -1.2 -65.4 -58.0 -35.1 0.0 39.3 7.1 -20.6 -7.7 -6.3

Friday 72.1 68.1 63.4 6.7 8.4 9.9 0.0 4.1 4.3 72.4 80.5 77.6 7.2 4.3 1.9 -67.5 -52.4 -39.0 0.0 92.2 7.8 -18.6 -5.2 -5.9 Saturday 76.3 71.7 67.0 8.2 6.6 9.6 0.0 5.9 4.2 77.5 84.2 80.8 8.8 6.8 1.7 -61.7 -59.9 -41.5 0.0 131.9 0.5 -16.4 -2.3 -6.6 Weekend 74.2 69.9 65.2 7.5 7.5 9.7 0.0 5.0 4.2 74.9 82.4 79.2 8.0 5.6 1.8 -64.5 -56.0 -40.3 0.0 113.8 4.0 -17.5 -3.7 -6.2

Total 63.7 65.6 62.3 7.2 5.9 8.3 0.0 2.8 3.8 70.8 74.3 74.4 -5.5 2.7 -0.3 -65.6 -57.6 -37.6 0.0 70.7 4.5 -19.7 -6.5 -6.3

ADR Sunday 144.53 114.52 131.50 165.29 140.93 160.15 0.00 74.99 112.65 146.91 114.66 133.26 -12.1 -9.9 -6.4 -6.1 -7.9 -8.1 0.0 -25.6 0.9 -12.2 -13.0 -7.9 Monday 149.58 121.35 145.02 166.24 138.22 166.15 0.00 83.52 109.50 151.49 121.70 145.32 -8.0 -10.0 -5.1 -1.7 -7.6 -3.0 0.0 -16.9 -3.0 -10.3 -11.0 -5.5 Tuesday 150.37 125.04 151.94 165.67 142.18 166.40 0.00 93.92 109.79 152.03 125.77 151.13 -9.4 -8.1 -3.0 -2.1 -1.7 -1.1 0.0 -8.7 -3.3 -8.8 -8.2 -3.3 Wednesday 151.92 125.66 151.96 167.22 141.09 163.69 0.00 86.76 109.60 153.49 125.99 150.94 -8.1 -7.4 -2.2 -1.5 -0.8 0.3 0.0 -17.2 -0.6 -7.7 -7.5 -2.2 Thursday 153.76 122.74 141.11 164.00 141.02 155.42 0.00 85.59 111.36 154.67 123.18 141.12 -8.0 -8.5 -5.9 -4.6 -2.5 -6.8 0.0 -18.8 -2.7 -8.1 -8.9 -6.6 Weekday 150.27 122.20 145.02 165.75 140.77 162.37 0.00 83.51 110.56 151.90 122.58 144.95 -9.0 -8.7 -4.3 -3.2 -4.3 -3.8 0.0 -18.9 -1.8 -9.3 -9.5 -4.8

Friday 152.70 120.84 136.28 166.53 138.79 154.92 0.00 88.12 109.36 153.88 121.03 137.18 -12.6 -8.3 -7.4 -2.6 -12.7 -7.2 0.0 -21.6 -2.4 -11.5 -11.6 -8.2 Saturday 147.53 122.13 136.12 167.31 137.59 152.05 0.00 90.96 113.88 149.45 121.16 136.85 -14.5 -9.9 -8.4 -4.6 -11.1 -11.1 0.0 -18.7 1.7 -13.7 -12.5 -9.4 Weekend 150.04 121.50 136.20 166.96 138.26 153.51 0.00 89.79 111.60 151.59 121.10 137.01 -13.6 -9.1 -7.9 -3.6 -11.9 -9.2 0.0 -19.9 -0.4 -12.6 -12.1 -8.8

Total 150.18 121.91 142.46 166.25 140.41 157.51 0.00 87.89 111.52 151.81 122.12 142.56 -10.7 -8.9 -5.1 -3.7 -7.0 -7.4 0.0 -11.7 0.1 -10.3 -10.3 -6.0

RevPAR Sunday 80.24 63.78 66.62 11.92 6.24 10.37 0.00 2.05 4.64 88.02 72.07 81.63 -22.2 -5.9 -8.5 -66.8 -70.6 -49.0 0.0 38.5 6.7 -37.5 -20.3 -16.3 Monday 82.52 75.83 84.88 11.92 6.65 13.26 0.00 1.27 4.55 101.14 83.75 102.69 -24.0 -11.0 -8.6 -64.1 -66.1 -40.4 0.0 3.8 0.3 -32.1 -21.0 -14.2 Tuesday 92.35 84.60 97.43 12.35 7.74 14.23 0.00 1.17 4.85 111.60 93.51 116.50 -14.6 -5.5 -2.0 -66.1 -52.3 -30.6 0.0 17.3 7.9 -23.6 -12.4 -6.4 Wednesday 97.72 86.64 98.40 12.26 7.59 14.19 0.00 1.29 4.67 113.68 95.52 117.25 -11.7 -5.4 -2.1 -64.1 -52.6 -28.2 0.0 0.4 5.0 -22.3 -12.3 -6.0 Thursday 97.25 80.15 87.09 10.07 8.67 14.41 0.00 1.84 4.94 110.94 90.67 106.44 -12.8 -10.2 -7.7 -71.4 -53.5 -39.0 0.0 5.6 5.8 -25.1 -17.3 -13.2 Weekday 90.15 78.30 87.04 11.71 7.38 13.31 0.00 1.52 4.73 105.17 87.20 105.08 -16.8 -7.5 -5.4 -66.5 -59.8 -37.6 0.0 13.0 5.1 -28.0 -16.4 -10.8

Friday 110.11 82.26 86.35 11.23 11.60 15.38 0.00 3.62 4.68 111.35 97.47 106.41 -6.3 -4.3 -5.6 -68.3 -58.5 -43.5 0.0 50.6 5.2 -28.0 -16.2 -13.6 Saturday 112.50 87.52 91.21 13.74 9.14 14.56 0.00 5.38 4.80 115.85 102.04 110.56 -6.9 -3.8 -6.9 -63.5 -64.3 -48.0 0.0 88.5 2.2 -27.8 -14.6 -15.4 Weekend 111.31 84.89 88.78 12.49 10.37 14.97 0.00 4.50 4.74 113.60 99.76 108.49 -6.7 -4.0 -6.3 -65.8 -61.3 -45.8 0.0 71.2 3.6 -27.9 -15.4 -14.5

Total 95.62 80.01 88.77 11.93 8.31 13.05 0.00 2.43 4.22 107.55 90.75 106.04 -15.6 -6.4 -5.3 -66.9 -60.5 -42.2 0.0 50.8 4.6 -28.0 -16.1 -11.9

The STR STAR Report is a publication of STR, Inc. and STR Global, Ltd., and is intended solely for use by paid subscribers. Reproduction or distribution of the STR STAR Report, in whole or part, without written permission is prohibited and subject to legal action. If you have received this report and are NOT a subscriber to the STR STAR Report, please contact us immediately. Source: 2020 STR, Inc. / STR Global, Ltd. trading as “STR”. Tab 17 - Segmentation Day Of Week - Running 12 Month Residence Inn San Diego Mission Valley 1865 Hotel Cir S San Diego, CA 92108-3319 Phone: (619) 881-3600 STR # 45777 ChainID: SANHC MgtCo: Island Hospitality Management Owner: Chatham Lodging Trust Market Scale: San Diego, CA Upscale Chains For the Month of: December 2019 Date Created: January 17, 2020 Monthly Competitive Set Data Excludes Subject Property

Running 12 Month Percent Change (%) TransientGroup Contract Total Transient Group Contract Total Market Market Market Market Market Market Market Market My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale

Total 69.9 69.2 66.4 15.3 10.6 12.0 0.0 2.0 3.6 85.3 81.8 82.0 -0.1 -4.9 -0.9 -2.2 -14.1 -7.6 0.0 89.4 -3.6 -0.5 -5.1 -2.0

Total 174.41 141.61 160.80 175.97 157.76 173.51 0.00 105.24 114.24 174.69 142.82 160.61 1.2 -0.4 -0.5 5.8 3.3 1.4 0.0 -1.9 1.9 2.0 -0.3 -0.1

Total 121.94 97.95 106.70 27.00 16.78 20.81 0.00 2.12 4.12 148.94 116.84 131.63 1.1 -5.3 -1.3 3.4 -11.3 -6.3 0.0 85.8 -1.8 1.5 -5.4 -2.2

Residence Inn San Diego Mission Valley 1865 Hotel Cir S San Diego, CA 92108-3319 Phone: (619) 881-3600

STR # 45777 ChainID: SANHC MgtCo: Island Hospitality Management Owner: Chatham Lodging Trust Market Scale: San Diego, CA Upscale Chains

For the Month of: December 2019 Date Created: January 17, 2020 Monthly Competitive Set Data Excludes Subject Property

Revenue Per Rooms Sold Percent Change (%) Ranking

Room F&B Other Total (TrevPOR**) Room F&B Other Total (TrevPOR**) My Prop vs. Comp Set Market Market Market Market Market Market Market Market Current Month My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale Room F&B Other Total

2018 Jul 207.16 181.75 197.52 4.37 10.44 7.41 7.85 193.53 215.81 -3.1 3.5 2.6 -53.1 -24.0 19.5 24.3 1.3 1.5 4 of 7 Aug 172.72 151.75 170.67 4.18 12.16 7.08 7.60 163.01 190.43 -6.8 1.4 1.9 -40.6 -17.3 2.8 25.7 -0.3 1.2 3 of 7 Sep 159.84 137.19 156.53 6.78 13.15 6.72 7.81 150.69 177.49 -3.1 0.2 3.3 -40.3 -18.8 -3.6 52.6 -2.9 2.7 2 of 7 Oct 169.99 140.13 157.59 0.00 7.28 12.90 0.00 5.63 7.53 169.99 153.04 178.03 4.5 5.4 4.9 -18.9 -22.1 -39.5 32.9 1.2 3.2 1 of 7 2 of 4 Nov 171.72 140.13 155.25 7.98 12.08 5.16 7.75 153.27 175.08 14.7 13.0 6.7 -3.9 -19.7 1.0 31.4 11.5 5.1 1 of 7 Dec 165.72 127.35 141.18 6.20 11.71 6.51 9.72 140.06 162.62 16.4 17.9 13.9 39.7 -13.3 21.2 111.7 18.8 14.4 1 of 7 2019 Jan 168.66 132.36 148.79 5.24 11.75 5.95 9.55 143.55 170.09 19.0 10.4 7.9 -12.7 -13.5 -17.5 36.7 7.8 7.4 2 of 7 Feb 177.99 143.87 159.21 9.62 14.21 4.86 8.83 158.34 182.26 9.1 5.9 1.0 135.4 12.1 -21.7 39.1 8.4 3.2 1 of 7 Mar 178.39 141.75 158.77 10.94 14.40 6.93 7.58 159.61 180.75 4.9 2.2 1.3 127.3 18.1 8.9 41.7 6.5 3.7 1 of 7 Apr 171.89 141.90 159.61 4.39 15.13 6.39 6.94 152.69 181.67 3.3 3.8 2.6 16.4 23.5 -8.3 39.5 3.6 5.2 3 of 7 May 169.01 143.01 161.45 3.94 13.02 7.25 7.54 154.20 182.01 3.6 1.4 1.5 -39.6 -4.4 -0.3 20.6 -0.4 1.7 3 of 7 Jun 196.72 164.14 181.07 6.99 11.37 7.61 10.37 178.75 202.81 6.5 3.3 4.8 45.0 -20.3 27.2 68.8 5.3 5.0 2 of 7 Jul 212.53 180.59 195.85 3.22 10.72 7.40 9.61 191.22 216.17 2.6 -0.6 -0.8 -26.4 2.7 -0.2 22.4 -1.2 0.2 2 of 7 Aug 179.22 150.02 167.80 5.52 12.10 7.87 9.26 163.41 189.15 3.8 -1.1 -1.7 31.9 -0.5 11.2 21.8 0.2 -0.7 2 of 7 Sep 167.22 137.74 156.11 8.62 12.60 7.51 8.59 153.87 177.30 4.6 0.4 -0.3 27.0 -4.2 11.9 10.1 2.1 -0.1 1 of 7 Oct 160.64 129.02 149.05 15.42 12.85 7.63 8.78 152.07 170.68 -5.5 -7.9 -5.4 111.9 -0.4 35.5 16.6 -0.6 -4.1 2 of 7 Nov 151.92 125.63 144.71 9.18 12.48 5.08 9.46 139.89 166.64 -11.5 -10.3 -6.8 15.1 3.3 -1.7 22.0 -8.7 -4.8 2 of 7 Dec 138.39 110.13 132.64 7.94 10.90 7.10 10.00 125.17 153.54 -16.5 -13.5 -6.1 28.1 -7.0 9.0 2.9 -10.6 -5.6 2 of 7

Year To Date 2017 174.55 138.93 155.75 7.84 15.77 6.46 5.36 153.24 176.88 2.1 -0.3 2.8 -40.9 -2.3 57.2 19.2 -2.3 2.8 1 of 7 2018 171.31 143.25 160.82 5.51 12.57 6.55 7.00 155.32 180.39 -1.9 3.1 3.3 -29.7 -20.3 1.4 30.6 1.4 2.0 2 of 7 2019 174.69 142.82 160.61 7.50 12.62 6.83 8.87 157.15 182.10 2.0 -0.3 -0.1 36.0 0.4 4.2 26.6 1.2 0.9 1 of 7

Running 3 Month 2017 152.88 121.87 140.51 7.27 15.11 6.65 5.41 135.78 161.02 -7.5 -7.6 -1.5 -62.4 -7.6 64.8 13.3 -12.6 -1.7 2 of 7 2018 169.30 136.17 151.68 7.17 12.26 5.75 8.29 149.09 172.23 10.7 11.7 7.9 -1.3 -18.8 -13.5 53.3 9.8 7.0 1 of 7 2019 151.81 122.12 142.56 10.99 12.12 6.58 9.39 139.70 164.07 -10.3 -10.3 -6.0 53.3 -1.1 14.5 13.2 -6.3 -4.7 2 of 7

Running 12 Month 2017 174.55 138.93 155.75 7.84 15.77 6.46 5.36 153.24 176.88 2.1 -0.3 2.8 -40.9 -2.3 57.2 19.2 -2.3 2.8 1 of 7 2018 171.31 143.25 160.82 5.51 12.57 6.55 7.00 155.32 180.39 -1.9 3.1 3.3 -29.7 -20.3 1.4 30.6 1.4 2.0 2 of 7 2019 174.69 142.82 160.61 7.50 12.62 6.83 8.87 157.15 182.10 2.0 -0.3 -0.1 36.0 0.4 4.2 26.6 1.2 0.9 1 of 7

** TrevPOR = Total revenue per occupied room (sum of Room, F&B, and Other revenue divided by total occupied rooms).

Residence Inn San Diego Mission Valley 1865 Hotel Cir S San Diego, CA 92108-3319 Phone: (619) 881-3600

STR # 45777 ChainID: SANHC MgtCo: Island Hospitality Management Owner: Chatham Lodging Trust Market Scale: San Diego, CA Upscale Chains

For the Month of: December 2019 Date Created: January 17, 2020 Monthly Competitive Set Data Excludes Subject Property

Revenue Per Rooms Available Percent Change (%) Ranking

Room F&B Other Total (TrevPAR**) Room F&B Other Total (TrevPAR**) My Prop vs. Comp Set Market Market Market Market Market Market Market Market Current Month My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale My Prop Comp Set Scale Room F&B Other Total

2018 Jul 202.12 167.49 181.19 4.03 9.58 6.83 7.20 178.35 197.96 -0.4 0.5 2.0 -54.4 -24.4 16.0 23.7 -1.7 1.0 2 of 7 Aug 166.83 137.10 152.96 3.78 10.90 6.39 6.81 147.27 170.68 -3.8 3.3 3.7 -39.5 -15.9 4.6 27.9 1.5 2.9 3 of 7 Sep 137.08 117.68 131.15 5.82 11.02 5.76 6.54 129.26 148.71 -7.4 7.8 3.9 -35.7 -18.4 3.7 53.4 4.4 3.2 4 of 7 Oct 158.45 119.70 134.07 0.00 6.22 10.98 0.00 4.81 6.41 158.45 130.73 151.45 9.8 8.6 11.8 -16.5 -16.9 -37.7 41.7 4.3 10.1 1 of 7 2 of 4 Nov 159.14 111.91 122.68 6.37 9.54 4.12 6.13 122.41 138.35 49.7 10.9 10.7 -5.6 -16.7 -0.9 36.4 9.4 9.1 1 of 7 Dec 130.78 93.06 104.46 4.53 8.67 4.76 7.19 102.35 120.32 46.6 9.2 20.7 29.5 -8.1 12.3 124.5 10.1 21.3 1 of 7 2019 Jan 140.24 104.97 114.95 4.15 9.08 4.72 7.38 113.85 131.41 82.2 15.4 15.9 -8.8 -7.2 -13.8 46.7 12.7 15.2 3 of 7 Feb 161.84 116.43 131.08 7.78 11.70 3.93 7.27 128.14 150.05 21.8 -3.7 -0.6 113.9 10.4 -28.8 37.0 -1.5 1.6 1 of 7 Mar 166.28 122.77 136.42 9.47 12.37 6.00 6.51 138.25 155.30 13.4 -5.9 -0.5 109.3 16.0 0.3 39.2 -1.9 1.9 2 of 7 Apr 151.50 121.04 135.60 3.75 12.85 5.45 5.90 130.24 154.35 16.2 -1.1 3.9 10.9 25.1 -12.7 41.3 -1.3 6.5 3 of 7 May 142.57 111.15 127.04 3.06 10.25 5.63 5.93 119.84 143.22 0.1 -8.2 -3.6 -45.4 -9.1 -9.7 14.6 -9.9 -3.4 3 of 7 Jun 183.37 148.60 162.85 6.33 10.23 6.89 9.32 161.82 182.40 4.0 -0.2 3.6 40.1 -21.2 22.8 66.8 1.7 3.8 2 of 7 Jul 206.42 161.58 179.09 2.88 9.80 6.62 8.78 171.09 197.68 2.1 -3.5 -1.2 -28.5 2.3 -3.1 22.0 -4.1 -0.1 2 of 7 Aug 169.77 130.18 147.22 4.79 10.62 6.83 8.12 141.80 165.95 1.8 -5.0 -3.8 26.7 -2.6 6.8 19.2 -3.7 -2.8 2 of 7 Sep 144.92 113.31 129.37 7.09 10.44 6.18 7.12 126.58 146.93 5.7 -3.7 -1.4 21.8 -5.3 7.3 8.9 -2.1 -1.2 3 of 7 Oct 124.29 99.91 118.65 11.94 10.23 5.91 6.99 117.75 135.87 -21.6 -16.5 -11.5 92.0 -6.8 22.8 9.1 -9.9 -10.3 3 of 7 Nov 131.11 98.90 110.83 7.23 9.55 4.00 7.25 110.12 127.63 -17.6 -11.6 -9.7 13.4 0.1 -3.1 18.3 -10.0 -7.7 3 of 7 Dec 69.24 73.70 89.03 5.31 7.32 4.75 6.71 83.76 103.06 -47.1 -20.8 -14.8 17.3 -15.6 -0.2 -6.7 -18.2 -14.3 4 of 7

Year To Date 2017 149.26 117.94 127.48 6.66 12.90 5.49 4.39 130.08 144.78 -1.9 0.3 5.5 -40.6 0.2 58.2 22.2 -1.6 5.4 3 of 7 2018 146.74 123.48 134.56 4.75 10.52 5.65 5.86 133.88 150.93 -1.7 4.7 5.6 -28.6 -18.5 3.0 33.5 2.9 4.3 3 of 7 2019 148.94 116.84 131.63 6.14 10.34 5.59 7.27 128.57 149.25 1.5 -5.4 -2.2 29.1 -1.7 -1.1 24.0 -4.0 -1.1 3 of 7

Running 3 Month 2017 113.33 98.76 105.69 5.89 11.36 5.38 4.07 110.03 121.12 -16.3 -2.7 -0.4 -60.4 -6.6 73.6 14.5 -7.9 -0.6 3 of 7 2018 149.35 108.18 120.38 5.70 9.73 4.57 6.58 118.45 136.69 31.8 9.5 13.9 -3.2 -14.4 -15.2 61.8 7.7 12.9 1 of 7 2019 107.55 90.75 106.04 8.17 9.02 4.89 6.98 103.81 122.04 -28.0 -16.1 -11.9 43.4 -7.3 7.1 6.1 -12.4 -10.7 4 of 7

Running 12 Month 2017 149.26 117.94 127.48 6.66 12.90 5.49 4.39 130.08 144.78 -1.9 0.3 5.5 -40.6 0.2 58.2 22.2 -1.6 5.4 3 of 7 2018 146.74 123.48 134.56 4.75 10.52 5.65 5.86 133.88 150.93 -1.7 4.7 5.6 -28.6 -18.5 3.0 33.5 2.9 4.3 3 of 7 2019 148.94 116.84 131.63 6.14 10.34 5.59 7.27 128.57 149.25 1.5 -5.4 -2.2 29.1 -1.7 -1.1 24.0 -4.0 -1.1 3 of 7

** TrevPAR = Total revenue per available room (sum of Room, F&B, and Other revenue divided by total available rooms).

The STR STAR Report is a publication of STR, Inc. and STR Global, Ltd., and is intended solely for use by paid subscribers. Reproduction or distribution of the STR STAR Report, in whole or part, without written permission is prohibited and subject to legal action. If you have received this report and are NOT a subscriber to the STR STAR Report, please contact us immediately. Source: 2020 STR, Inc. / STR Global, Ltd. trading as “STR”. Tab 20 - Segmentation Response Report Residence Inn San Diego Mission Valley 1865 Hotel Cir S San Diego, CA 92108-3319 Phone: (619) 881-3600 STR # 45777 ChainID: SANHC MgtCo: Island Hospitality Management Owner: Chatham Lodging Trust For the Month of: December 2019 Date Created: January 17, 2020

This Year December 2019 (This Year) December 2018 (Last Year) Dec 23rd - First Day of Hanukkah Sun Mon Tue Wed Thu SatFri Sun Mon Tue Wed Thu Fri Sat Dec 24th - Christmas Eve 7654321 1 Dec 25th - Christmas Day 81109 11 12 13 42 345 76 8 Dec 26th - First Day of Kwanzaa 15 16 17 18 19 2120 9 10 11 12 13 14 15 Dec 31st - New Year's Eve 22 23 24 25 26 27 28 16 17 18 19 20 21 22 29 30 31 23 24 25 26 27 28 29 30 31 Last Year Dec 3rd - First Day of Hanukkah Dec 24th - Christmas Eve Dec 25th - Christmas Dec 26th - First Day of Kwanzaa Dec 31st - New Year's Eve

2018 2019

STR# Name City, State Zip Phone Rooms Open Date Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 45777 Residence Inn San Diego Mission Valley San Diego, CA 92108-3319 (619) 881-3600 192 200303 sssssssssBssssssssssssss 9581 Sheraton Hotel San Diego Mission Valley San Diego, CA 92108-3521 (619) 260-0111 260 198407 BBBBBBBBBBBBBBBBBBBBBBBB 17360 DoubleTree by Hilton Hotel San Diego Hotel CircleSan Diego, CA 92108-3409 (619) 881-6900 219 197006 BBBBBBBBBBBBBBBBBBBBBBBB 22368 Residence Inn San Diego Central San Diego, CA 92111-1303 (858) 278-2100 144 198905 39251 Extended Stay America San Diego Hotel Circle San Diego, CA 92108-3313 (619) 296-5570 166 199911 63814 Holiday Inn Express & Suites San Diego Mission VSan Diego, CA 92108-3404 (619) 795-7705 104 201505 64528 Homewood Suites by Hilton San Diego Mission VaSan Diego, CA 92108-3502 (619) 260-0600 118 201604 BBBBBBBBBBBBBBBBBBBBBBBB 1203 Data received: s = Segmentation (Transient, Group, Contract) Only r = Additional Revenue Only B = Both Segmentation & Additional Revenue

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Please visit our website at www.str.com, or if you need additional assistance please reach out to our Customer Support team. North America: International: 735 East Main Street, Hendersonville, TN 37075 USA Blue Fin Building, 110 Southwark Street, London SE1 0TA T : +1 615 824 8664 T : +44 (0) 207 922 1930 [email protected] [email protected]

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For the latest in industry news, visit HotelNewsNow.com. To learn more about the Hotel Data Conference, visit HotelDataConference.com. Addenda

Addendum D CLIENT CONTRACT INFORMATION

DocuSign Envelope ID: AAB3AADC-0415-4BC1-AAF9-996B9B1A0320

FIRST AMENDMENT TO

SAN DIEGO HOUSING COMMISSION’S

AGREEMENT FOR MARKET STUDY AND APPRAISAL OF HOTEL PORTFOLIO

WITH

CBRE, INC.

Contract No. RED-21-05

WHEREAS, the San Diego Housing Commission (“Commission”) and CBRE, Inc. (“Contractor”) entered into that certain Agreement for Market Study and Appraisal of Hotel Portfolio (the “Agreement”), dated July 9, 2020, and effective July 1, 2020 through December 31, 2020;

WHEREAS, the Commission and Contractor now desire to amend the Agreement in order to revise the Specifications/Scope of Work as contained in Attachment 101 of the Agreement to allow the Contractor to perform work related to any additional properties identified by the Development team;

WHEREAS, locations for said work will be provided by the Commission to the Contractor via task order;

WHEREAS, Residence Inn Sorrento Mesa, 5595 Pacific Mesa Court, San Diego, CA. 92121 (“Residence Inn Sorrento Valley”) shall be removed from the list of properties, and Residence Inn Mission Valley, 1865 Hotel Circle S. San Diego CA 92108 (“Residence Inn Mission Valley”) shall be added in Attachment 101 and Attachment 103 of the Agreement;

WHEREAS, the Commission desires to increase the compensation to a not-to-exceed amount of $50,000 to accommodate for the performance of any additional services required under this Agreement;

WHEREAS, the Commission and the Contractor desire to revise Attachment 103 “Additional Compensation Terms” to include an additional per Appraisal fee of $6,000 and an additional per Market Study fee of $6,500;

NOW THEREFORE, the Commission and Contractor hereby amend the Agreement and agree as follows:

1. Attachment Section 101 Specifications/Scope of Work: Attachment Section 101 “Specifications/Scope of Work” of the Agreement is hereby amended and restated in its entirety herein as Exhibit 1.

2. Section 103. Compensation: Section 103 “Compensation” of the Agreement is hereby amended and rested in its entirety to read as follow:

103. Compensation. The total compensation for all services performed and/or materials and goods supplied pursuant to this Agreement shall not exceed the sum of Fifty Thousand and NO/100 Dollars ($50,000.00). Contractor acknowledges that the Commission is under no obligation to compensate Contractor for services rendered and goods and materials supplied or expenses accrued under this Agreement in excess of the maximum compensation specified above. Payment shall be made after submission of invoices and within thirty (30) days of submission, if approved by the Commission.

Page 1 of 8 First Amendment to Agreement for Market Study and Appraisal of Hotel Portfolio (RED-21-05) DocuSign Envelope ID: AAB3AADC-0415-4BC1-AAF9-996B9B1A0320

3. Attachment Section 103 Additional Compensation: Attachment Section 103 “Additional Compensation” of the Agreement is hereby amended and restated in its entirety herein as Exhibit 2.

4. No Novation. The parties hereto acknowledge and agree that except for the changes set forth herein to exercise the First Amendment under the Agreement, all of the terms and provisions of the Agreement are hereby acknowledged by the parties to be valid and are hereby recognized, renewed, extended and continued in full force and effect.

5. Counterparts. This First Amendment may be executed in any number of counterparts and, as so executed the counterparts shall constitute one and the same agreement. The parties agree that each such counterpart is an original and shall be binding upon all the parties, even though all of the parties are not signatories to the same counterpart.

[SIGNATURES APPEAR ON FOLLOWING PAGE]

Page 2 of 8 First Amendment to Agreement for Market Study and Appraisal of Hotel Portfolio (RED-21-05) DocuSign Envelope ID: AAB3AADC-0415-4BC1-AAF9-996B9B1A0320

IN WITNESS WHEREOF, the parties have caused this FIRST AMENDMENT to be executed this ______day of August 2020.

Contractor: CBRE, Inc.

By: Mark Remick Vice President

Date: ______8/11/2020

Commission: San Diego Housing Commission

By: Pari Zaker Vice President, Real Estate Department

Date: ______

By: _ Maurcell Gresham Director of Procurement

Date: ______

Approved as to Form: Christensen & Spath LLP

By: ______Charles B. Christensen General Counsel San Diego Housing Commission

Page 3 of 8 First Amendment to Agreement for Market Study and Appraisal of Hotel Portfolio (RED-21-05) DocuSign Envelope ID: AAB3AADC-0415-4BC1-AAF9-996B9B1A0320

Date: ______

EXHIBIT 1

ATTACHMENT 101

SPECIFICATIONS/ SCOPE OF WORK

Section 101. Description of Work (Continued from Page 1):

This continuation of the description of work is expressly incorporated into the Agreement and is a continuation of the provisions set forth in Page 1 of this Agreement.

I. Project Information

The Contractor shall provide a Market Study and Appraisal for two properties at the following site locations and any additional properties identified by the Development team for potential acquisition (together “Properties):

1. Residence Inn Kearny Mesa, 5400 Kearny Mesa Road, San Diego, CA 92111 (“Residence Inn Kearny Mesa”) 2. Residence Inn by Marriott, 1747 Pacific Coast Highway, San Diego, CA 92101 (“Residence Inn by Marriott”) 3. Residence Inn Mission Valley, 1865 Hotel Circle S. San Diego CA 92108 (“Residence Inn Mission Valley”)

Site locations for additional properties will be provided by the Commission to the Contractor via task order.

II. Scope of Work A. Appraisal: i. Purpose: To provide an estimate of the Market Value of the referenced real estate. ii. Premise: As Is iii. Rights Appraised: Fee Simple iv. Intended Use: Internal Decision-making purposes v. Intended User: The intended users are the Commission and such other parties and entities (if any) expressly recognized by Contractor as “Intended Users” (as further defined herein). vi. Reliance: Reliance on any reports produced by Contractor under this Agreement is extended solely to parties and entities expressly acknowledged in a signed writing by Contractor as Intended Users of the respective reports, provided that any conditions to such acknowledgement required by Contractor or hereunder have been satisfied. Parties or entities other than Intended Users

Page 4 of 8 First Amendment to Agreement for Market Study and Appraisal of Hotel Portfolio (RED-21-05) DocuSign Envelope ID: AAB3AADC-0415-4BC1-AAF9-996B9B1A0320

who obtain a copy of the report or any portion thereof (including Commission if it is not named as an Intended User), whether as a result of its direct dissemination or by any other means, may not rely upon any opinions or conclusions contained in the report or such portions thereof, and Contractor will not be responsible for any unpermitted use of the report, its conclusions or contents or have any liability in connection therewith. vii. Inspection: Contractor will conduct a physical inspection of both the interior and exterior of the Properties, as well as its surrounding environs on the effective date of appraisal. viii. Valuation Approaches: The Sales Comparison and Income Capitalization Approaches will be completed. ix. Report Type: Concise (Summary) Appraisal Report x. Appraisal Standards: USPAP xi. Appraisal Fee: Refer to Attachment No. 3 herein for individual fees by property xii. Expenses: Fee includes all associated expenses xiii. Retainer: A retainer is not required for this assignment xiv. Payment Terms: Final payment is due upon delivery of the final report or within thirty (30) days of your receipt of the draft report, whichever is sooner. The fee is considered earned upon delivery of the draft report. Contractor will invoice Commission for the assignment in its entirety at the completion of each stage (verbal and written report) of the assignment. xv. Delivery Instructions: An Adobe PDF file via email will be delivered to [email protected]. Three (3) bound final copies.

B. Market Study i. Purpose: To provide LIHTC market studies for the referenced real estate on an individual property basis ii. Premise: As Is iii. Rights Appraised: Fee Simple iv. Intended use: Internal Decision Making purposes and submit for tax credits. v. Intended user: The intended users are the Commission and the California Debt Allocation Committee (CDLAC), California Tax Credit Allocation Committee (TCAC), and such other parties and entities (if any) expressly recognized by Contractor as “Intended Users” (as further defined herein). vi. Reliance: Reliance on any reports produced by Contractor under this Agreement is extended solely to parties and entities expressly acknowledged in a signed writing by Contractor as Intended Users of the respective reports, provided that any conditions to such acknowledgement required by Contractor or hereunder have been satisfied. Parties or entities other than Intended Users

Page 5 of 8 First Amendment to Agreement for Market Study and Appraisal of Hotel Portfolio (RED-21-05) DocuSign Envelope ID: AAB3AADC-0415-4BC1-AAF9-996B9B1A0320

who obtain a copy of the report or any portion thereof (including Commission if it is not named as an Intended User), whether as a result of its direct dissemination or by any other means, may not rely upon any opinions or conclusions contained in the report or such portions thereof, and Contractor will not be responsible for any unpermitted use of the report, its conclusions or contents or have any liability in connection therewith. vii. Inspection: Contractor will conduct a physical inspection of both the interior and exterior of the Properties, as well as its surrounding environs on the effective date of appraisal. viii. Report type: LIHTC Market Study ix. Appraisal Standards: USPAP & TCAC Market Study Guidelines x. Appraisal Fee: Refer to Attachment No. 3 herein for individual fees by property xi. Expenses: Fees include all associated expenses xii. Retainer: A retainer is not required for this assignment. xiii. Payment Terms: Final payment is due upon delivery of the final report or within thirty (30) days of your receipt of the draft report, whichever is sooner. The fee is considered earned upon delivery of the draft report. Contractor will invoice Commission for the assignment in its entirety at the completion of each stage (verbal and written report) of the assignment. xiv. Delivery Instructions: An Adobe PDF file via email will be delivered to [email protected]. Three (3) bound final copies.

III. Specific Property Data Request In order to complete this assignment under the terms outlined, Contractor will require the following specific information for the property: 1. 2017, 2018 and 2019 P & Ls for each hotel. 2. December 2019 STAR report as well as the latest April report, if readily available. 3. A list of significant capital improvements performed over past 5 years plus any planned renovations (prior to COVID-19). 4. Most recent real estate tax bill 5. Any descriptive information of hotels physical features and constructions details. Any previous appraisals would be helpful for this. 6. If there are any outside leases for the restaurant(s), bar(s) or any other part of the property (such as a ground lease), Contractor will need copies of those leases and a rent roll depicting the current rents.

If any of the requested data and information is not available, Contractor, reserves the right to extend the delivery date by the amount of time it takes to receive the requested information or make other arrangements. Please have the requested information delivered to the following:

Mark Remick Vice President

Page 6 of 8 First Amendment to Agreement for Market Study and Appraisal of Hotel Portfolio (RED-21-05) DocuSign Envelope ID: AAB3AADC-0415-4BC1-AAF9-996B9B1A0320

[email protected] CBRE, Inc. Valuation & Advisory Services 4301 La Jolla Village Drive, Suite 3000 San Diego, CA 92121

IV. Access and Deliverables: Within 48 hours of the Commission’s issuance of a Notice to Proceed for each property, the Commission shall provide Contractor with access to each of the Properties. Reports shall be transmitted to the Commission no later than end of business day as follows: 1.Preliminary Value: Not Required 2.Draft Report: 21 business days after the issuance of the Notice to Proceed for Appraisals; 27 days after the issuance of the Notice to Proceed for Market Study. 3.Final Report: Upon Commission request

This Agreement and any and all deliverables prepared hereunder shall be considered confidential and not subject to production under the California Public Records Act Pursuant to Government Code Section 6254(h), Government Code Section 6254(k), and Evidence Code Section 1040, until such a time as the property has been obtained.

Page 7 of 8 First Amendment to Agreement for Market Study and Appraisal of Hotel Portfolio (RED-21-05) DocuSign Envelope ID: AAB3AADC-0415-4BC1-AAF9-996B9B1A0320

EXHIBIT 2

ATTACHMENT 103

ADDITIONAL COMPENSATION TERMS

Section 103. Compensation. (Continued from Page 2):

Appraisals:

PROPERTY LIST Property Name Property Location Report Type Appraisal Fee Residence Inn by Marriott 1747 Pacific Highway 03-Concise Report $6,000 Residence Inn by Marriott 5400 Kearney Mesa Rd. 03-Concise Report $6,000 Residence Inn by Marriott 1865 Hotel Circle S. 03-Concise Report $6,000 Assignment Total: $18,000

Fee for additional appraisals: $6,000 per appraisal

Market Studies:

PROPERTY LIST Property Name Property Location Report Type Market Study Fee Residence Inn by Marriott 1747 Pacific Highway 03-Concise Report $6,500 Residence Inn by Marriott 5400 Kearney Mesa Rd. 03-Concise Report $6,500 Residence Inn by Marriott 1865 Hotel Circle S. 03-Concise Report $6,500 Assignment Total: $19,500

Fee for additional market studies: $6,500 per market study

Total compensation paid under this Agreement shall not exceed the maximum compensation set forth in this Agreement.

Page 8 of 8 First Amendment to Agreement for Market Study and Appraisal of Hotel Portfolio (RED-21-05) Addenda

Addendum E QUALIFICATIONS

PROFESSIONAL PROFILE

Dan Beverly, MAI, has been actively engaged in commercial real estate valuation and consulting services since 2007, and currently performs a variety of valuation and consulting engagements related to a wide variety of property types. Mr. Beverly is in the Valuation & Advisory Services Group’s Newport Beach office in the Southern California Region. Prior to joining CBRE, he held various appraisal positions with other national and international commercial real estate firms in both management and production roles. Mr. Beverly has a broad range of experience in the valuation and analysis of a variety of asset types including hotels and resorts, multifamily, industrial, retail, office, development land, religious institutions, net leased, ground leased, DAN BEVERLY, MAI specialty medical, agricultural, mixed use, day care, institutional, recreational, Vice President special use, and going-concern valuations of complex assets, among others. Valuation and Advisory Services T. +1 (949) 809-4074 Mr. Beverly’s expertise includes valuation of fee simple, leased fee, and leasehold [email protected] interests, hotel/resort and multifamily feasibility studies, highest and best use studies, multifamily rental and marketability studies, a variety of easements, re- www.cbre.com/Dan.Beverly use and redevelopment projects, acquisition/disposition, foreclosure and pre- foreclosure related valuations, and various estate-related valuations. Mr. Beverly has provided ongoing appraisal and consulting services to REITs, institutional and local lending institutions, law firms, pension funds, CPA’s, governmental entities and agencies, buyers, sellers, investors, and developers, among others.

CREDENTIALS Certifications  Appraisal Institute, Designated Member (MAI) Licensing  Certified General Real Estate Appraiser, State of California, No. AG3003262  Certified General Real Estate Appraiser, State of Hawaii, No. CGA-1265  Certified General Real Estate Appraiser, State of Florida, No. RZ3570  Certified General Real Estate Appraiser, State of New York, No. 46000052456  Certified General Real Estate Appraiser, State of Washington, No. 1102523

EDUCATION

 University of Central Florida, Orlando, FL – B.S. Business Administration - 2008

Rev. July 2019