Host Raises Outlook as Hotel Revenue Growth Accelerates
Comparable hotel RevPAR rose 7.0%, its fastest growth in four quarters.
Host Hotels & Resorts (HST), the lodging real-estate investment trust, reported faster second-quarter hotel revenue growth and raised its full-year outlook.
The quarter extended a recovery in property performance. Comparable hotel RevPAR growth accelerated from 4.4% in the first quarter, 4.6% in the fourth quarter of 2024 and 0.2% in the third quarter, with the RevPAR level rising sequentially to $251.53 from $244.11.
Revenue increased 3.4% from a year earlier to $1.640 billion, compared with 3.2% growth in the prior quarter. Net income rose 7.1% to $241 million, and diluted earnings increased 9.4% to $0.35 a share. First-quarter profit and EPS growth had exceeded 99%, primarily because of asset-sale gains.
Higher room rates drove the hotel gains. Average room rate increased 5.8% to $335.83, as occupancy rose 0.8 percentage point to 74.9%. Transient room revenue grew 6.9% despite a 0.7% decline in room nights, and group room revenue increased 7.4% on 3.5% growth in room nights.
Performance varied across markets. RevPAR rose 54.7% in Austin, 16.5% in Washington, D.C., 15.8% in Northern Virginia and 13.6% in Maui. It fell 6.9% in New Orleans and 3.1% in Orlando, with Seattle and Denver each declining 2.6%.
Adjusted EBITDAre increased 5.8% to $525 million, roughly matching the first quarter’s 5.6% pace. Comparable hotel EBITDA margin expanded 60 basis points from a year earlier to 31.9%, though it narrowed from 32.7% in the first quarter.
Host now expects full-year comparable-hotel RevPAR growth of 4.75% to 5.25%, up from 3.0% to 4.5%, and Total RevPAR growth of 4.75% to 5.25%, up from 3.5% to 5.0%. The company also lifted the midpoint of its full-year Adjusted EBITDAre guidance by $20 million and diluted EPS guidance by $0.04.
Condominium sales contributed $53 million of second-quarter revenue, including seven villa sales that added $8 million to net income and Adjusted EBITDAre. Host also estimated that damage from the March Kona Low storm would total about $27 million to $32 million and forecast $25 million to $30 million of property reconstruction spending this year.