Elisabeth Eisleben – Director-Investor Relations Daniel P. Hansen – President and Chief Executive Officer Greg A. Dowell – Chief Financial Officer, Executive Vice President, and Treasurer.

Chris J. Woronka – Deutsche Bank Austin Wurschmidt – KeyBanc Capital Markets Inc. Andrew G. Didora – Bank of America Merrill Lynch Ryan Meliker – MLV & Co. Wesley Keith Golladay – RBC Capital Markets.

Good day, ladies and gentlemen, and welcome to the Third Quarter 2014 Summit Hotel Properties Incorporated Earnings Conference Call. My name is Jackie and I will be your coordinator for today. At this time, all participants are in a listen-only mode. We will be facilitating a question-and-answer session towards the end of the presentation.

(Operator Instructions) I would now like to turn the conference over to Ms. Elisabeth Eisleben, Director of Investor Relations. Please proceed, ma’am..

Thank you Jackie and good morning. I am joined today by Summit Hotel Properties President and Chief Executive, Dan Hansen, and Executive Vice President and Chief Financial Officer, Greg Dowell.

Dan and Greg have prepared comments related to our third quarter 2014 release and filings and following these comments, we will have an opportunity to address any related questions you may have. As a reminder this conference call is the property of Summit Hotel Properties.

Any redistribution, retransmission or rebroadcast of this call in any form without the express written consent of Summit is prohibited. Please also note that many of our comments today are considered forward-looking statements as defined by federal securities laws.

These statements are subject to numerous risks and uncertainties both known and unknown as described in our 2013 Form 10-K and our other SEC filings. These risks and uncertainties could cause the results to differ materially from those expressed or implied by our comments.

Forward-looking statements that we make today are effective only as of today, November 03, 2014 and we undertake no duty to update them later. Our earnings release contains reconciliations to non-GAAP financial measures referenced during this call. If you do not have a copy of our release, you may view and print it from our website www.shpreit.com.

Please welcome Summit Hotel Properties’ President and Chief Executive Officer, Dan Hansen..

Thanks Elisabeth and thank you all for joining us today for our third quarter 2014 earnings conference call.

On the call today, we will update you on operating results, provide more detail on our financial performance for the quarter, discuss our balance sheet and liquidity and finish with a review of our outlook for the fourth quarter and the remainder of 2014.

Let me begin by expressing how thrilled we are with the performance of our portfolio in the third quarter exceeding both the high end of our guidance and the Street’s estimates. For the third quarter of 2014, we reported adjusted FFO of $0.30 per diluted share, which exceeded the $0.24 to $0.26 per share guidance range we provided for the quarter.

Our AFFO per share of $0.30 represents 20% growth compared to the same period in 2013. On a pro forma basis including hotels acquired in the third quarter, we reported RevPAR growth of 15.1% which exceeded the Smith Travel upscale average by 520 basis points.

Our RevPAR growth was driven by a 7.4% increase in average daily rate and increased occupancy of 7.2% to 79.4%. Our same-store RevPAR growth for the quarter was 11.3% compared to the third quarter of 2013 and also exceeded the Smith Travel research upscale average in the quarter.

RevPAR was driven by a combination of increases in average daily rate which was up 6.7% and a 4.2% increase in occupancy.

Our continued success in posting robust same-store and pro forma RevPAR highlights the strength and quality of our portfolio, our talented asset management and revenue management teams, our strong partnership with our third-party managers and the strategic capital improvements we have made over the last two years.

Our strongest markets this quarter were New Orleans and Memphis which posted 37% and 35% RevPAR growth respectively. Our six California hotels were also strong contributors as a group posted 15.5% RevPAR growth.

The combination of strong industry fundamentals, minimal supply, freshly renovated properties and our best-in-class asset management gives us great confidence in our portfolio’s ability to continue to deliver strong results. Moving on to acquisitions.

During the third quarter we acquired two hotels, the 190-room Hilton Garden Inn located in the energy corridor area of Houston, Texas and the 209-room Hampton Inn & Suites located in downtown Austin. The total purchase price of the two acquisitions was $89 million and brought our total acquisition since IPO in 2011 to $1 billion.

We remain extremely selective in targeting hotels that fit our long-term growth objectives and remain focused on the highest quality premium select-service assets that will provide strong in-place yields and create long-term shareholder value. Next, I wanted to more formally introduce our CFO, Greg Dowell.

He joins us with significant public company experience and has quickly embraced his leadership role. Although he has been formally on board for about 30 days, his enthusiasm and work ethic have already had a positive effect on our team.

With that I will turn the call over to Greg to provide further detail on our financial and operating results for the third quarter of 2014..

Thanks, Dan. As Dan said, the third quarter was really strong for Summit and the overall industry. We are extremely pleased with our portfolio results in several key areas. In the third quarter, we achieved a 20.3% increase in our pro forma hotel EBITDA as compared to the third quarter of 2013 bringing us to approximately $41.6 million.

During the quarter, our pro forma hotel EBITDA margin expanded by 163 basis points to 37.1%. For the third quarter of 2014, our portfolio generated adjusted EBITDA of $36.7 million, an increase of $10.3 million or 38.7% on a quarter-over-quarter basis. The substantial growth in adjusted EBITDA was largely driven by exceptional RevPAR growth.

As we and others have reported, we have seen some hotel operating expenses come in higher this year such as property taxes and some branded initiatives, but at this point do not anticipate a recurrence of the same magnitude next year.

Moving on to the balance sheet, we continue to maintain a strong balance sheet and liquidity position with ample capacity and access to various sources of capital to execute our strategic objectives.

At September 30, 2014, we had total outstanding debt of approximately $624 million with a weighted average interest rate of 4.4% and an average term to maturity of nearly five years. At the quarter end, we had $203 million outstanding on our $300 million credit facility.

Including available capacity on our line of credit, cash and cash equivalents on our balance sheet, we have approximately $100 million of available liquidity to fund our investment objectives. At the end of the third quarter, our net debt to trailing 12-month adjusted EBITDA was 4.9 times.

On October 31, 2014, the company declared $0.1175 per share quarterly dividend on its common stock. The dividends will be paid on November 28 to shareholders of record as of November 14, 2014.

Turning to our guidance for the fourth quarter of 2014, we are providing RevPAR growth guidance for the same-store portfolio of 6.5% to 8.5% and a pro forma portfolio of 5% to 7%. Our adjusted FFO guidance for the quarter is $13.9 million to $15.7 million, or $0.16 to $0.18 per share.

For the full year 2014, we are increasing our RevPAR growth targets to be 8.5% to 9.5% for our same-store portfolio and 9% to 10% for our pro forma portfolio. These revised ranges represent substantial increases at both the high and low end of the previously provided ranges for both our same-store and pro forma portfolios.

These changes were based on our portfolio results in the first nine months of the year, which were above the high-end of our guidance previously provided. We are updating our full-year 2014 adjusted FFO guidance range to be $80.7 million to $82.5 million, or $0.93 to $0.95 per share, increasing the midpoint by $0.04 per.

As a reminder, our guidance assumes no additional acquisitions or dispositions in 2014. With that, I’ll turn the call back over to Dan..

Thanks, Greg. In summary, the third quarter of 2014 was really strong for both Summit and the industry as a whole. We’re thrilled with the performance of our portfolio and the continued execution by our team. With that we’d open the call up to questions. I do know that they are having some challenges with the dial-in. They have had some servers down.

They are not showing any questions in queue for us. I guess that is hopefully just a delay. So if you do have any questions, you may need to resubmit them..

(Operator Instructions) And your first question comes from the line of Chris Woronka with Deutsche Bank. Please proceed..

Hi, good morning guys..

Hi, Chris..

Dan, a quick question for you kind of on what you’re seeing in the acquisition market. I mean, we – I think we’ve started to see a little bit more compression between some of the select-service yields and maybe some of the urban upper upscale yields.

And are you seeing more or different buyers popping up on things you’re looking at?.

That is a great question, Chris. I think that it’s been pretty apparent that private equity has been chasing portfolio deals and that hasn’t slowed down much. On a one-off basis, we’re still actually seeing a fair amount of direct inbound calls and direct requests from us to look at transactions.

But yes, I do think it’s fair that the attractiveness and the thesis about the real value proposition with select-service is getting more and more recognized. So I would expect there to be continued desire and activity in the transaction market. But as far as us, we’re not seeing any new competitors.

As we’ve said before, we’re not really a portfolio buyer, we’re kind of a one-off asset buyer and would prefer – we think we get better pricings from building our own portfolios..

Okay, great. And then I think you mentioned the California, your six California hotels being up about 15.5% in RevPAR for the quarter.

Would you say it is pretty consistent between the San Francisco area ones and the Hamptons in Southern California?.

Yes, it is pretty broad-based. I wouldn’t say that one – any one hotel really drove that considerably. We do have the Doubletree that was a brand conversion that was really the leader there, but it’s fairly broad based. The West Coast has been a great market for us and I expect more of the same there..

Okay, great. And then just to flip back to the asset transactions for a second, I think you’ve now completed all of the non-core asset sales you identified last year.

How do you look at the portfolio going into 2015? Is there kind of a next round of or maybe smaller non-core assets or do you think everything you have right now is pretty much a hold?.

Well we feel good about the portfolio. We did sell I think 22 assets since IPO and feel like we’ve got a great core portfolio as it sits. There is always a bottom 5% or 10% of the portfolio, so given the right offer we would certainly be inclined to sell and redeploy the capital into stronger assets.

We’ve been successful in doing that over the last several years and we think that’s a great strategy to create shareholder value. But nothing else is listed for sale, but it is something we do look pretty closely at..

Okay, very good, nice quarter. Thanks, Dan..

Thanks, Chris..

And your next question comes from the line of Jordan Sadler with KeyBanc Capital Markets..

Hi, guys. It’s Austin Wurschmidt here with Jordan. I just wanted to touch a little bit on the performance in the quarter on the occupancy side. It looks like the non-same store portfolio continues to outperform pretty significantly, particularly on occupancy.

And I was just curious how much upside do you think there is really within that pool on the occupancy?.

Thanks Austin, its Dan. We do continue to see some occupancy increases in the hotels in that portfolio and a lot of that is the completed renovations in 2013, really continue to ramp up as you build your base back. So beside the location, obviously the newer and cleaner product, we believe wins, so we’re seeing a lot of additional occupancy from that.

And we’re also continuing to focus on optimizing the mix of both leisure and corporate guests and filling up on the shoulder nights with more of our tactical sales and marketing initiatives from our revenue management team.

So I think we are getting pretty close to the point where we would expect more of our RevPAR to come from rate, but it does give us a great confidence that there is still a lot more embedded growth because we are able to drive that occupancy..

That is helpful.

And just kind of switching to supply, just can you give us sort of your thoughts on what you’re seeing in your markets looking into 2015 and sort of when you think that supply could start to become a bit of a headwind?.

Yes, it is top of everybody’s mind. It is an easy metric to look at. What is harder is to take that metric and determine how it affects each individual company. I think Smith Travel is estimating 1.3% in 2015 for new supply and I think it will be 2017 before we cross 2%.

But, however, supply definitely has picked up as people expected but we do see it being easily absorbed in many of these markets and having little effect on our results. With 90 hotels across the country, there’s may be a half a dozen areas where there is likely to be a new hotel, but we are a long way off from supply having a material effect on us.

Also construction costs have really skyrocketed. It is too early to tell if that’s affected any of the projects in planning, but I know it sense some developers back to revisit their numbers. So, it doesn’t really concern me that the majority of supplies in select-service.

I think I would be more concerned if we had a full-service hotel that may be starting to be surrounded by select-service, because I think that is where a lot of the new premium select-service hotels are drawing their demand from..

Thanks. And then just one last one from me. Just looking at the guidance, it looks like you are expecting a pretty material deceleration. I know you’ve got some renovation disruption in there.

But given October is such a big portion of 4Q, what have you seen so far into the fourth quarter in terms of just operating trends?.

Fourth quarter, October is a good month. Obviously you are seeing strong top line RevPAR numbers. November and December is always just a tough two months for us to measure. We don’t have a lot of group business, almost nonexistent. So we are reliant on the leisure for the transient guest both leisure and corporate.

So you can have some pretty big swings in November and December and we want to make sure that we’ve got a solid number out there. So no, nothing that we are seeing is a headwind or potential pitfall. We do have a little bit of renovation disruption, but feel really very good about the number..

Thanks, Dan..

Thanks, Austin..

And your next question comes from the line of Andrew Didora with Bank of America. Please proceed..

Hi, good morning everyone. Dan, I think this might be a follow-up from an earlier question, but I still have the delta between your pro forma and same-store RevPAR numbers was pretty material this quarter.

Was this mostly driven by those California hotels? And how should we think about kind of pro forma versus same-store as we head out into 2015? Should they be maybe a bit more comparable since your acquisition activity has subsided a little bit here?.

Yes, on a go forward basis for next year, they will be a more – a tighter portfolio, a bigger number. I think 84 hotels would be our same-store, so I think it will be a little easier to take a look at. We do have the Hyatt Place in Minneapolis that was not officially closed that we’ve got a very easy comp for RevPAR that that starts to go away here.

That drove that number a little bit higher than the same-store. I think that’s probably the biggest effect that you see out there that’s probably not as clear..

Okay, that is helpful and then just kind of a one modeling question here. I see G&A came in really significantly higher than we were anticipating and kind of where it has been coming in here. Anything special in that number and what do you feel is a good run rate from here on out? Thanks..

Hi Andrew, this is Greg. As we look to the full-year, we’re anticipating about $17.5 million to $18 million in kind of G&A. We have two or three things going on, on there.

One is the transition of an executive and then also we’re in the third full calendar year as a public company and you’ve got some ramp up on the equity incentives as well as some outperformance.

So as we go into the end of the year, we’re looking at about in a $17.5 million to $18 million range, but taking out that equity-based compensation, it would have been about $14 million to $14.5 million..

Okay, that’s helpful. Thanks a lot, guys..

Thanks, Andrew..

Thank you..

And your next question comes from the line of Ryan Meliker, MLV and Company. Please proceed..

Hi, good morning guys. Greg, welcome aboard. I just had a couple of quick questions. You guys did a nice job throwing a table into your release that shows your relative outperformance not just on a pro forma basis, but on a same-store basis versus the overall industry and versus the upscale segment on a RevPAR level.

And I am just wondering can you give us some indication on what is driving that particularly on the same-store? Is it just that you are portfolio is in better locations, better maintained? All of the above? Anything else? And the second thing I was hoping you guys could answer was you mentioned a little bit about some disruption that you will see in 4Q 2014, how does the renovation calendar look for 2015 and are you expecting any increase or decrease in disruption relative to 2014 next year?.

Okay, Ryan, it is Dan. I will try to answer all of those in order. I think the RevPAR outperformance by our portfolio is really a blend of acquiring great assets, renovating and investing capital into assets that have the best upside opportunity and the strong and talented team that Craig has here.

If you look at the outperformance, we did have some real strong performance in New Orleans. Now that is coming off an easy comp from last year but if you just look at the whole portfolio, we had 20 hotels that had greater than 20% RevPAR growth, we have 32 that had greater than 15% RevPAR growth and 52 that had double-digit RevPAR growth.

So you can see it is really broad-based. And the takeaway I think is that we have built a very high quality portfolio and the results of all of the hard work that we have done kind of early in mid cycle what we are starting to see the benefits of that now. Onto the disruption in the fourth quarter, I think you could say maybe $0.5 million of revenue.

We are a little bit out of cycle this year. We typically have greater disruption in the fourth quarter but we did a lot of work early in the first quarter last year or early in the first quarter this year specifically San Francisco.

And as far as the CapEx and investment next year, obviously we haven’t given guidance yet and are still in the process of formulating our plan. So I think it is a little too early to give guidance on what we have got for 2015..

All right. Fair enough. Thanks for answering the questions. Nice quarter..

Thanks Ryan..

Thanks Ryan..

And your next question comes from the line of..

Wes Golladay of RBC..

Please proceed..

Yes. Good morning guys, very nice quarter. Just sticking with that CapEx question, I noticed the CapEx budget went down a little bit on the high end.

Is there anything special there, are we pushing some out to next year?.

Yes, I think its we always try to put out a range that gives us the flexibility to make sure we are communicating effectively but also able to increase or decrease based on the needs in the property. Craig and his team spend a lot time evaluating every part of the renovation. And making sure we spend money where we can get the greatest return.

But nothing that is significant that was canceled or planned, but every renovation kind of goes through a little bit of an evolution from the first time you price it out to the actual purchase of the product. So it does move around a little bit but nothing I would see as material..

Okay, so it actually came in a little bit late than you guys originally anticipated.

Would hat be the takeaway?.

That’s fair..

Okay.

And then for next year, how many acquisition tips do you have from the properties you just acquired? Will some go out to 2016 or will they all be done next year?.

We could do all of the last three acquisitions, we could do them all next year. That is the process we go through once we finish budgeting now is to plan out our capital for the next 18 months. And depending upon the penetration and competition in the market, there may be one or two that instead of next year we may push off to the following year.

But I think you should expect us not to postpone renovations unless there is a specific need. We still believe there is a several years of good RevPAR growth in the cycle and would prefer to do work earlier than later. So, I don’t know, hopefully that helps..

Okay. And then on the balance sheet, line utilization is up a bit from quarter to quarter. Would you just use debt to take that out? Would that be the – it looks like you have some debt capacity right now..

Yes, I think, this is Dan again, I think, given the attractive financing environment, we definitely would explore some permanent options on some of the unencumbered assets and those proceeds would be used to reduce the balance on the line..

Okay. Thanks for taking the questions. .

Thanks, Wes..

(Operator Instructions) Due to no questions, I would like to turn the call back to Mr. Dan Hansen for closing remarks..

Thanks everybody for dialing in today. I apologize for a little bit of the challenges with the dial-in. Again, we are just thrilled with the performance of the company excited about the runway we have ahead. I do know you all have a busy week, appreciate your time today and look forward to seeing you all at NAREIT. Have a great day..

Ladies and gentlemen that concludes today’s conference. Thank you for your participation you may now disconnect and have a great day..