Hampton Inn & Suites, Phoenix, AZ

Sustainability

Apple Hospitality REIT is committed to enhancing and incorporating sustainability opportunities into our investment and asset management strategies, with a focus on minimizing our environmental impact. We seek to invest in proven sustainability practices when renovating our hotels and in portfolio-wide capital projects that can enhance asset value while also improving environmental performance. We target specific environmental efficiency enhancements, including equipment upgrades and replacements, that reduce energy and water consumption and improve waste management. As part of our acquisition due diligence, we perform sustainability assessments to identify areas of opportunity that will improve the property's environmental performance. Additionally, when working with developers to construct new hotels, we strive to implement environmentally efficient construction and building functionality. Our current environmental impact and certain strategies, programs and accomplishments are highlighted below.

Key Metrics for 2018

The Company's 234 hotels comprise over 19 million square feet of building space and utilized the following energy resources in 2018:

251,000

Energy Consumption Megawatt Hours

12.95

Total KWH Per Square Foot

1,030,000

Water Consumption Kilogallons

12,500

Waste In Tons

22%

Diversion Rate

Environmental Governance

The environment has always been a key consideration in the operations of our hotels. We actively monitor key performance indicators of energy, water and waste at each property, utilizing historical, market and industry data to identify properties where improvements can be made and work with our management companies to address the opportunities. We also continually review systems and processes for broader scale implementation. Examples of projects that have helped us reduce electric and water usage for our total same store portfolio over the past three years include the installation of LED lighting, Energy Management Systems, Irrigation Systems and Energy Efficient HVAC Equipment. In addition to our efforts improving environmental efficiencies, the rooms-focused hotels we invest in are more operationally and environmentally efficient than full-service hotels, with the Company’s kWh per square foot below 13 in 2018.

To enhance our commitment to sustainable operations, Apple Hospitality REIT established a formal energy management program in 2018, engaging resources throughout our Company to ensure that energy, water and waste management are a priority not only within the Company, but also with our management companies and brands. Many of the hotel brands have energy, water and waste management programs that we utilize to improve our environmental performance, and we work closely with the brands to identify priorities for future investment that will further advance sustainable operating standards.

Currently, Apple Hospitality participates in the following brand sustainability programs:

LED LIGHTING

LED LIGHTING

In 2018, the Company initiated LED retro-fit for parking lot lighting fixtures at 16 hotels. The LED bulbs used in the retro-fit of the parking lot lighting fixtures require approximately 65% less energy on average when compared to the previously existing fixtures. The increased lifespan of these bulbs also means there will be less disposal, reducing the contamination to the environment and landfills. By converting these fixtures to LED, the 16 hotels reduced the total annual energy consumption by an estimated 260,000 kWh or an average of approximately 16,000 kWh for each hotel.

Irrigation systems

Irrigation systems

In 2017 and 2018, the Company installed smart irrigation watering systems at 13 hotels. A smart irrigation controller has built-in water saving features including a sensor to adjust to the optimal sprinkler run time based on the local weather conditions. Smart controllers help to provide a healthy, beautiful landscape while reducing water usage. Water consumption readings were taken through dedicated meters at each property in the year prior to the project completion to establish the annual water consumption pattern. The usage for the year following the project completion was then compared to the previously recorded data to calculate the estimated water savings. As a result of the smart irrigation system installations, the 13 hotels were able to reduce irrigation water consumption by 41% to save a total of approximately 4,200 Kilogallons of water.

Energy Management Systems

Energy Management Systems

The Company continues to install guest room energy management systems across our portfolio, and in conjunction with our average annual spend of more than $5 million on Energy Star rated HVAC equipment, we are able to reduce energy consumption and save our hotels 10-15% in heating and cooling costs annually.

Energy & water conservation guidelines

Energy & water conservation guidelines

In 2018, Apple Hospitality implemented energy and water conservation guidelines for all of our hotels. Developed jointly with our energy partner, these best practices provide our hotels and management companies with operating guidelines to consistently and responsibly use energy and water across the entire portfolio. The guidelines, documented in both English and Spanish, cover daily processes in all facets of hotel operations, as well as considerations for the procurement of more energy and water efficient equipment and systems.

New Construction

As part of our overall strategy, the Company works with high-quality developers to build new hotels that are acquired by the Company at the hotel’s opening. Throughout the construction process, we work with the developers to identify and implement sustainable practices in the construction of each hotel and develop sustainable operating functionality. A few of the best practices utilized by our developers include:

  • LED lighting throughout the hotel
  • Guest room energy management systems
  • Recycled content
  • Energy Star appliances
  • Low-emissivity glass for windows
  • Low VOC paint
  • Greenguard Gold gypsum board
  • Ultra-high-efficiency water heaters
  • High-efficiency toilets and plumbing fixtures

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