Procaccianti Hotel Reit, Inc. (OTC: PRXA)

Procaccianti Hotel REIT, Inc. is a Maryland corporation that operates as a real estate investment trust focused on acquiring and owning a diversified portfolio of select service, extended stay and compact full service hotel properties throughout the United States. As of December 31, 2025, the company owned interests in five select service hotel properties comprising 559 rooms located in four states. The firm elected REIT status beginning with its taxable year ended December 31, 2018 and is externally managed by PHA, an affiliate of its sponsor Procaccianti Companies, Inc.

The company generates revenue primarily by leasing its wholly owned hotel properties to taxable REIT subsidiary lessees under percentage leases that provide rental payments equal to the greater of a fixed base rent amount or a percentage of hotel room revenue. Lease income from these TRS lessees is eliminated in consolidation for financial reporting purposes, but the underlying hotel operations produce cash flow that supports distributions to stockholders. Additional sources of cash include proceeds from property refinancings and occasional capital transactions.

The company operates through the following segments:

• Real Estate Segment: The company’s sole operating segment encompasses the acquisition ownership leasing management and disposition of hospitality real estate assets. This includes overseeing five select service hotel properties negotiating leases with TRS lessees working with property management affiliates such as TPG Hotels & Resorts Inc. and monitoring mortgage debt and capital expenditures.

Procaccianti Hotel REIT, Inc. competes in the highly competitive U. S. hotel lodging sector where properties vie on location brand affiliation room rates quality and service offerings. Its select service extended stay and compact full service hotels face competition from other branded and independent hotels as well as alternative lodging platforms such as Airbnb and VRBO. The company’s competitive advantages stem from its focus on stabilized income producing assets with modest value add opportunities its REIT structure that provides tax efficient income distribution and its external management arrangement with PHA that supplies acquisition expertise and operational support.

The company’s customers are the taxable REIT subsidiary lessees that lease its hotel properties; these lessees are wholly owned by the company’s TRS holding company and engage third party management firms such as TPG Hotels & Resorts Inc to operate the hotels on a day to day basis. Ultimately the hotels serve transient and extended stay travelers seeking lodging in the selected markets.