A token $0.01 dividend that is not an income holding, however strong the underlying hotels look. The trailing yield is 0.19% on a $0.01 quarterly dividend that has not moved since the March 2020 suspension of the $0.38 regular dividend, so under §1 the tag stays warn as a not-income-purpose holding. Coverage is not the problem — payout is about 2% of guided Adjusted FFO — and leverage of 5.3 times sits inside the pass band. Same-property RevPAR rose 6.5% to $259 in Q2 2026, but none of that operating strength currently reaches common shareholders as income.
Key risk: The common dividend may stay token while preferred equity and debt service absorb cash flow.
Changes if: The common dividend is restored toward a meaningful rate, or leverage rises above 6×.
- ✓AFFO payout ~2% of guided Adjusted FFO, under the 80% pass threshold.
- ✓Leverage 5.3× company-stated, under the 6× pass threshold; $717.2M preferred equity outstanding sits ahead of the common dividend.
- !Raise history $0.38 regular dividend suspended March 2020; $0.01/qtr since, held flat; Q3 $0.01 declared Sept 15, 2026.
- !Income purpose Yield 0.19%, under 1% — §1 sub-1% / not-income-purpose rule, tag stays warn.
What this grade doesn't say: It screens the dividend only — covered, real, compounding. It says nothing about valuation or price: a well-covered payer can still be overpriced, and its price can still fall.