Key Highlights

  • Third quarter Revenue was USD 1,347 million against USD 1,331 million last year, with diluted EPS of USD 0.10.
  • Comparable hotel RevPAR was USD 219.50, up 8.8%, while comparable hotel Total RevPAR was USD 348.19, up 7.3%.
  • Purchases after quarter end: 1 Hotel Brooklyn Bridge at USD 202 million and a Dallas hotel at USD 172 million.
  • Full year Adjusted FFO per diluted share guidance is now USD 2.21, against a previous midpoint of USD 2.16.

Two hotel purchases and a recast Credit Facility followed the close of the third quarter at Host Hotels & Resorts (NASDAQ:HST), which describes itself as the largest lodging real estate Investment trust. The company acquired the leasehold interest in the 195-room 1 Hotel Brooklyn Bridge and the fee Simple Interest in the 308-room Renaissance Dallas at Plano Legacy West Hotel, then amended its USD 2.5 billion credit facility. Quarterly diluted EPS was USD 0.10, against a USD 0.09 estimate.

How the Acquisitions and Facility Fit the Quarter

The 1 Hotel Brooklyn Bridge carried a total purchase price of USD 202 million, net of a USD 4 million furniture, fixtures and equipment reserve, and the Renaissance carried USD 172 million. Chief executive James Risoleo said the purchases expand the company's New York presence into a new submarket and establish a presence in the Dallas/Fort Worth market. Guidance includes about USD 3 million of Net Income and USD 6 million of Adjusted EBITDAre from the two hotels.

The amended facility extends the USD 1.5 billion revolver to January 2031 and the two USD 500 million term loans to January 2031 and January 2032, with extension Options that would align maturities at January 2032. Pricing fell by 12.5 basis points on revolver draws, 15 basis points on term loans and 5 basis points on the facility fee.

Results Around the Transactions

Net income was USD 71 million against USD 163 million, a decline of 56.4% that the company linked to lower gains on asset sales, partly offset by a GAAP operating profit Margin of 9.0%. Diluted EPS was USD 0.10 against USD 0.23. Adjusted FFO per diluted share was USD 0.39 against USD 0.35.

Adjusted EBITDAre was USD 347 million against USD 319 million. Comparable hotel EBITDA was USD 331 million at a margin of 25.2%. Management cited rate increases of 5.7% and an occupancy gain of 2.1 points, and described Demand boosted by the World Cup, along with higher Business transient demand and group bookings, despite an active hurricane season in Hawaii.

Cash, Dividend and Updated Guidance

At September 30 the company reported USD 1,492 million of cash and cash equivalents and Debt of USD 5.1 billion at a weighted average Interest Rate of 4.8%. After the acquisitions and the October dividend payment, it showed adjusted cash of USD 991 million. Weighted average Maturity was 4.4 years, or 5.2 years after the recast. The third quarter dividend was USD 0.20 per share, paid October 15, 2026.

Full year guidance for comparable hotel RevPAR growth was raised to 6.75% and Total RevPAR growth to 6.0%, against 5.0% for each at the previous midpoint. Net income is guided at USD 978 million, Adjusted EBITDAre at USD 1,865 million, diluted EPS at USD 1.40 and NAREIT FFO per diluted share at USD 2.17. Comparable hotel RevPAR for October grew about 6.5%.

Guidance Versus Reported Results

Quarterly Adjusted FFO per diluted share of USD 0.39 sits alongside year-to-date USD 1.69 and full year guidance of USD 2.21, while Adjusted EBITDAre of USD 347 million compares with a guided USD 1,865 million for the year.

Management named dated items: the October 15 dividend payment, results from the two new hotels entering comparable hotel results starting in the fourth quarter, final determination of Hurricane Helene and Milton Insurance Claims by the end of the year, and condominium sales near Four Seasons Resort Orlando, with an estimated USD 18 million net contribution this year and the remainder shifting into 2027.