8-K: Ashford Hospitality Trust Announces Preliminary Q4 2024 Results: RevPAR Up 3.0%

Ashford Hospitality Trust anticipates a 3.0% increase in Comparable RevPAR for Q4 2024 compared to the same period last year, driven by strong corporate and group demand.

Summary

• Ashford Hospitality Trust expects to report an occupancy rate of approximately 66% for the fourth quarter of 2024.
• The Average Daily Rate (ADR) is estimated to be around $190.
• This results in a Revenue Per Available Room (RevPAR) of approximately $126.
• Comparable RevPAR is expected to increase by approximately 3.0% compared to the fourth quarter of 2023.
• October 2024 saw a RevPAR increase of approximately 4.5% compared to October 2023.
• November 2024 experienced a RevPAR increase of approximately 0.4% compared to November 2023.
• December 2024 showed a RevPAR increase of approximately 3.8% compared to December 2023.
• Total hotel revenue increased approximately 4.4% in the fourth quarter and 6.9% in December.
• The company's offering of Series J and Series K non-traded preferred stock will close on March 31, 2025.
• The company raised approximately $185 million of gross proceeds from the sale of its Series J and Series K non-traded preferred stock since launching the offering in 2022.
• As of December 31, 2024, the company has 6,799,638 shares of its Series J non-traded preferred stock outstanding and 601,175 shares of its Series K non-traded preferred stock outstanding.

Sentiment

Score: 7

Explanation: The sentiment is moderately positive due to the reported increase in RevPAR and the success of the GRO AHT initiative. However, the presence of forward-looking statements and associated risks tempers the overall optimism.

Positives

• Comparable RevPAR is expected to increase by approximately 3.0% compared to the fourth quarter of 2023.
• The GRO AHT initiative is showing positive results, with increased hotel revenue.
• The company successfully raised approximately $185 million through the sale of Series J and Series K non-traded preferred stock.

Risks

• The announcement contains forward-looking statements that are subject to risks and uncertainties.
• These risks and uncertainties could cause actual results to differ materially from those anticipated.
• These risks are detailed in the company's filings with the Securities and Exchange Commission, including the Annual Report on Form 10-K for the year ended December 31, 2023.

Future Outlook

The company is excited to begin the next chapter as they continue to execute against their GRO AHT strategy and approach the repayment of their corporate strategic financing.

Management Comments

• Stephen Zsigray, President and Chief Executive Officer of Ashford Trust, stated that they are very pleased with their RevPAR performance in the fourth quarter.
• Stephen Zsigray noted that their high-quality, geographically diverse portfolio continues to deliver exceptional results due to strong corporate and group demand.
• Stephen Zsigray mentioned that their heightened focus on growing ancillary revenue streams under their recently announced GRO AHT initiative is already yielding impressive results.

Industry Context

This announcement indicates Ashford Hospitality Trust is experiencing growth in RevPAR, which is a key metric in the hotel industry. This growth is attributed to strong corporate and group demand, as well as the company's GRO AHT initiative. It would be useful to compare these results to other REITs focused on upper upscale, full-service hotels to assess Ashford's relative performance.

Comparison to Industry Standards

• To benchmark Ashford Hospitality Trust's performance, one could compare its RevPAR growth and occupancy rates to those of peers like Host Hotels & Resorts (HST) and Park Hotels & Resorts (PK).
• These companies also focus on upscale and luxury hotels and provide a good basis for comparison.
• For example, if HST and PK are reporting similar or higher RevPAR growth, it might indicate that Ashford's performance is in line with industry trends.
• However, if their growth is significantly lower, it could suggest that Ashford is outperforming its peers.
• Additionally, comparing Ashford's occupancy rates to the national average for upper upscale hotels can provide further context.
• Data from STR (Smith Travel Research) is often used to assess hotel industry performance and can provide valuable benchmarks.

Stakeholder Impact

• Shareholders may view the increased RevPAR and revenue growth positively.
• Employees may benefit from the company's improved financial performance.
• Customers may experience enhanced services and amenities as a result of the GRO AHT initiative.

Key Dates