Xenia Hotels & Resorts Shatters Expectations with Stellar Q3 Performance
Xenia Hotels & Resorts has delivered an outstanding third quarter performance, exceeding expectations and shattering records. The company's 29-hotel portfolio saw a 12.5% increase in same-property RevPAR (Revenue Per Available Room) to $184.75, compared to the same period last year.
Group demand was very strong, growing significantly compared to the third quarter of last year, while corporate transient demand and higher-end leisure customer demand remained resilient. This strong top-line performance carried through to the bottom line, with nearly 300 basis points of hotel EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) margin expansion.
"Our portfolio delivered an outstanding third quarter, with results that substantially exceeded the expectations we outlined on our second quarter earnings call at the end of July," said Marcel Verbaas, Chairman and Chief Executive Officer. "Group demand was very strong, as anticipated, and grew significantly compared to the softer demand we experienced in the third quarter of last year."
Adjusted EBITDAre was $53.2 million, an increase of 26%, and adjusted FFO (Funds From Operations) per share was $0.36, up almost 57% from the same quarter last year. This significant growth reflects both the strength of Xenia's operating results and the benefit of a lower share count following the significant share repurchases completed last year.
Key markets in the portfolio saw impressive RevPAR gains, with Philadelphia leading the way at 34.5%, followed by New Orleans at 29%. San Diego and Salt Lake City each achieved RevPAR growth in excess of 20%, while Pittsburgh, Santa Clara, Dallas, and Orlando also had very strong results during the quarter.
"While certain markets benefited from event-driven demand in July, including the FIFA World Cup at America 250, it is noteworthy that August and September delivered strong RevPAR gains as well," said Verbaas. "September's 16.8% RevPAR increase led the quarter."
Xenia's third-quarter performance was marked by a healthy balance between occupancy and average daily rate growth, indicating broadening demand across the portfolio. The company's ability to drive growth in total RevPAR, particularly through group demands and banquet and catering revenue, highlights its continued focus on delivering exceptional results.
