Financial Data and Key Metrics Changes - Adjusted EBITDARE for 2025 was $258.3 million, exceeding initial guidance and reflecting a strong performance compared to 2024 [10][12] - Net income for Q4 2025 was $6.1 million, with Adjusted FFO per share at $0.45, both meeting or exceeding guidance [8][10] - Total RevPAR for 2025 increased by 8%, driven by strong food and beverage revenue growth of 13.4% [5][11] Business Line Data and Key Metrics Changes - Same-property RevPAR for Q4 2025 increased by 4.5%, building on a 5.6% growth in Q4 2024 [8][20] - Food and beverage revenue for the full year was up 13.4%, significantly contributing to overall revenue growth [11][20] - Group room revenues increased by 12.8% compared to 2024, indicating strong demand in this segment [12][20] Market Data and Key Metrics Changes - Properties in Scottsdale, Denver, Santa Clara, Orlando, San Diego, and San Francisco showed substantial increases in Total RevPAR during 2025 [11][21] - Houston market experienced growth in RevPAR and Total RevPAR, recovering from previous challenges [9][12] - Overall, about half of the 30 hotels achieved RevPAR growth compared to 2024, indicating a positive trend across various markets [11][21] Company Strategy and Development Direction - The company plans to invest between $70 million and $80 million in capital expenditures for 2026, focusing on renovations and enhancements [16][17] - The strategy includes leveraging strong group demand and enhancing food and beverage offerings to attract more guests [12][30] - The company aims to maintain a balance between share repurchases and potential acquisitions, focusing on quality assets in underrepresented markets [35][58] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about future growth prospects, citing resilient lodging demand despite economic uncertainties [18][43] - The expectation of continued revenue ramp-up at Grand Hyatt Scottsdale and modest RevPAR growth across the portfolio supports the positive outlook for 2026 [18][42] - Management noted that the supply outlook is favorable, with expected supply growth of about 1% in 2026, which is beneficial for pricing power [44] Other Important Information - The company repurchased approximately 9.4 million shares in 2025, representing about 9.2% of outstanding shares at the start of the year [35][36] - A quarterly dividend of $0.14 per share was announced for Q1 2026, reflecting a yield of approximately 3.5% [36] - The company has no preferred equity or senior capital, indicating a strong balance sheet position [33] Q&A Session Summary Question: Can you provide more context around the RevPAR guide ranges? - Management highlighted that special events and strong group revenue pace are key factors supporting the RevPAR outlook, with visibility on growth in specific markets [47][48] Question: What are the recent trends in large corporate account growth? - Management noted consistent growth in large corporate accounts, particularly from major firms, indicating a positive trend for future performance [50][52] Question: Is there more activity expected in the asset trading market? - Management acknowledged increased optimism in the broker community and indicated potential for more external growth opportunities as market conditions improve [57][58] Question: How did the Nashville market perform in Q4 and what are the expectations for 2026? - Management reported challenges in Q4 but expects improvement in midweek corporate and group segments in 2026, driven by food and beverage transformations [66][67] Question: What is the outlook for OpEx growth and its impact from Grand Hyatt Scottsdale? - Management indicated that OpEx growth includes impacts from Grand Hyatt Scottsdale, with expectations for slight margin contraction due to increased occupancy and expenses [84]

Financial Data and Key Metrics Changes - Adjusted EBITDARE for Q4 2025 was $63.6 million, with net income reported at $6.1 million, both meeting or exceeding the top end of the guidance range [7][9] - For the full year 2025, net income was $63.1 million, and Adjusted FFO per share was $1.76, reflecting double-digit growth compared to 2024 [6][9] - Total RevPAR for 2025 increased by 8%, driven by strong food and beverage revenue growth of 13.4% [5][10] Business Line Data and Key Metrics Changes - Same-property RevPAR for Q4 2025 increased by 4.5%, building on a 5.6% growth in Q4 2024 [7][18] - Non-room revenues contributed to a 6.7% increase in same-property Total RevPAR for Q4 2025 [8][24] - Group room revenues increased by 12.8% in 2025 compared to 2024, significantly contributing to overall revenue growth [11][12] Market Data and Key Metrics Changes - Properties in Scottsdale, Denver, Santa Clara, Orlando, San Diego, and Santa Barbara showed substantial increases in Total RevPAR during 2025 [10][19] - Houston market experienced growth in RevPAR and Total RevPAR as market performance improved [8][20] - Weekend business was roughly flat compared to the prior year, with combined RevPAR for Friday and Saturday nights up 1.5% [22] Company Strategy and Development Direction - The company plans to invest between $70 million and $80 million in capital expenditures in 2026, focusing on renovations and enhancements [14][15] - The strategy includes a focus on group business, with expectations of continued strength in this segment due to upcoming large events [16][42] - The company aims to maintain a strong balance sheet while exploring external growth opportunities as market conditions improve [56][58] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about future growth prospects, citing resilient lodging demand despite economic uncertainties [16][44] - The company anticipates a continued ramp-up in revenues at Grand Hyatt Scottsdale and modest RevPAR growth for the rest of the portfolio [15][16] - The outlook for 2026 includes a projected Adjusted FFO per share increase of 7% over 2025 [35][36] Other Important Information - The company repurchased approximately 9.4 million shares in 2025, representing about 9.2% of outstanding shares at the start of the year [34] - The company has no preferred equity or senior capital, with a strong liquidity position of approximately $575 million [33] Q&A Session Summary Question: Can you provide more context around the RevPAR guide ranges? - Management highlighted that special events and strong group revenue pace are key components of the RevPAR outlook, with visibility on group business being a significant factor [46][48] Question: What are the recent trends in large corporate account growth? - Management noted that while corporate accounts are still below 2019 levels, there has been consistent growth, particularly in Q4, with mid-teens growth in the largest accounts [49][51] Question: Is there more activity in the asset trading market? - Management indicated that there is more product available in the market, and they are open to exploring external growth opportunities as conditions improve [54][56] Question: How is the Nashville market performing and what are the expectations for 2026? - Management acknowledged challenges in Q4 but sees potential for improvement in midweek corporate and group customers, with expectations for better performance in 2026 [64][65] Question: What is the timeline for the Nashville F&B ramp towards stabilization? - Management expects a quick ramp-up for new food and beverage outlets, with stabilization benefits anticipated over the next several years [77][79]

Financial Data and Key Metrics Changes - Comparable hotels total revenue was $329 million for Q4 2024 and $1.4 billion for the full year, up approximately 4% and 2.5% compared to the same periods in 2023 respectively [26] - Fourth quarter adjusted EBITDARE increased by approximately 7% and modified funds from operations (MFFO) rose by approximately 6% compared to Q4 2023 [10][36] - Comparable hotels RevPAR for Q4 was $109, up approximately 3%, with ADR at $153, up approximately 1%, and occupancy at 71%, up 2% compared to Q4 2023 [27] Business Line Data and Key Metrics Changes - The company achieved comparable hotels RevPAR growth of approximately 3% for Q4 and more than 1% for the full year, driven by improvements in both ADR and occupancy [9] - Comparable hotels occupancy for the full year was 75%, approximately 1% higher than 2023, and comparable hotels ADR was $159, up approximately 1% [27] Market Data and Key Metrics Changes - Approximately 55% of the company's hotels had no new upper upscale, upscale, or upper midscale product under construction within a five-mile radius at the end of Q4 [11] - The company noted that supply-demand dynamics remain favorable, with limited supply growth in its markets enhancing the overall risk profile of the portfolio [11] Company Strategy and Development Direction - The company continues to monitor its distribution rate and timing relative to hotel performance and potential capital uses, maintaining a disciplined approach to capital allocation [12][13] - Recent acquisitions have positively contributed to overall portfolio performance, with seven hotels acquired since June 2024 producing an unlevered 9% yield after CapEx [16] - The company is actively underwriting additional opportunities and is well-positioned to act where attractive yields can be achieved relative to other capital allocation choices [18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to produce strong returns for investors over the coming years, citing stable operating fundamentals and favorable supply-demand dynamics [22][42] - The outlook for 2025 includes expectations for net income between $173 million and $202 million, with comparable hotels RevPAR change projected between 1% and 3% [39] Other Important Information - The company paid distributions totaling $58 million or $0.24 per common share during Q4, bringing the annual payout to approximately $244 million or $1.01 per common share [37] - The company has approximately $1.5 billion of total debt outstanding, with a weighted average interest rate of 4.7% and a debt maturity profile averaging three years [38] Q&A Session Summary Question: What operating expense growth has been assumed in 2025 guidance? - Management indicated that normalizing for fixed cost hurdles, the assumed increase for total hotel expenses is around 4.2% at the midpoint, with variable expenses outside of fixed costs around 3.5% [50] Question: What percentage of the portfolio would be described as having outsized CapEx needs? - Management stated that between 7% and 10% of the portfolio fits this category, with a focus on strategic and tactical reasons for prioritizing asset sales [52] Question: How close is the midweek ADR to weekend ADR? - Management noted that midweek ADR is getting closer to weekend levels, with continued opportunities for growth as occupancy improves [60] Question: What is the outlook for RevPAR growth in 2025? - Management believes that both business and leisure demand could contribute to outperforming the guidance, with midweek growth expected to be a significant driver [73] Question: What is the expected wage benefit growth this year? - Wage benefit growth is expected to be between 3.5% and 4% [130] Question: What is the current state of the transaction market? - Management indicated that the transaction market remains challenging, with fewer bidders interested in portfolios, but they expect conditions to improve as the year progresses [66][110]