Chatham Lodging Belief publicizes First Quarter 2024 outcomes: Adjusted EBITDA rose a strong 6 p.c to $18.9m.

WEST PALM BEACH, FLA. – Chatham Lodging Belief, a lodging actual property funding belief (REIT) that invests in upscale, extended-stay resorts and premium-branded, select-service resorts, introduced outcomes for the primary quarter ended March 31, 2024.

First Quarter 2024 Working Outcomes

• Portfolio Income Per Obtainable Room (RevPAR) – Elevated 2 p.c to $120 in comparison with the 2023 first quarter. Common every day price (ADR) accelerated 1 p.c to $171, and occupancy jumped 1 p.c to 70 p.c for the 38 resorts owned as of March 31, 2024.
• • RevPAR for the Silicon Valley and Bellevue resorts was up 17 p.c over the 2023 first quarter.

• • April 2024 RevPAR was up 5 p.c over 2023 for your complete portfolio.
• Web Earnings / (Loss) – Web lack of $5.5 million in comparison with internet lack of $5.0 million within the 2023 first quarter. Web loss per diluted widespread share was $0.15 versus $0.14 through the 2023 first quarter.
• Resort EBITDA Margin – Generated margins of 30.8 p.c within the 2024 first quarter, up barely from 2023 first quarter margins of 30.7 p.c.
• Adjusted EBITDA – Rose a strong 6 p.c to $18.9 million from $17.8 million within the 2023 first quarter.
• Adjusted FFO – Produced adjusted FFO of $7.9 million within the 2024 first quarter, similar as the primary quarter of 2023. Adjusted FFO per diluted share was $0.16 for each intervals.

The next chart summarizes the consolidated monetary outcomes for the three-months ended March 31, 2024, and 2023, primarily based on all properties owned throughout these intervals ($ in tens of millions, besides margin percentages and per share knowledge):

Jeffrey H. Fisher, Chatham’s president and chief govt officer, emphasised, “We’re fairly happy with our robust begin to the yr, delivering adjusted FFO per share of $0.16, beating consensus estimates as our lodge EBITDA margins outperformed our expectations. RevPAR progress of two p.c was in the course of our steering, and our earnings beat was pushed by lodge EBITDA margins exceeding our midpoint by roughly 230 foundation factors. RevPAR progress simply surpassed {industry} efficiency, and our EBITDA margins benefited from a 17 p.c enhance in different working division revenue and a $0.8 million or 13 p.c lower in property tax expense ensuing from refunds on sure resorts.”

“Along with our working outcomes, we proceed to strengthen our stability sheet with the sale of the 24-year previous Hilton Backyard Inn Denver Tech Heart for $18 million earlier this yr whereas additionally avoiding a $6 million renovation. At quarter finish, our internet debt to trailing twelve month EBITDA was a really wholesome 4.0 occasions, and we are going to proceed to opportunistically promote further belongings in 2024 with the intent to redeploy these proceeds into debt discount and in the end make increased progress lodge investments,” Fisher highlighted.

Resort RevPAR Efficiency

The beneath chart summarizes key lodge monetary statistics for the resorts owned as of March 31, 2024, in comparison with the 2023 and 2019 first quarter:

The beneath chart summarizes RevPAR statistics by month for the corporate’s resorts:

Fisher continued, “Our first quarter RevPAR progress of two p.c was 7X industry-wide RevPAR progress, and as we’ve got said, our portfolio ought to proceed to outperform the {industry} given the resurgence of our primarily know-how dependent markets. RevPAR progress at our 5 tech resorts in Silicon Valley and Bellevue accelerated 17 p.c within the first quarter, and April RevPAR progress at these similar resorts remained robust, rising 12 p.c.

“Good points in portfolio occupancy are coming from enterprise journey and that is very important to Chatham’s progress trajectory. First quarter weekday occupancy was the best since 2019 and for the primary time for the reason that pandemic, first quarter weekday occupancy outpaced weekend occupancy. Weekday occupancy gained two p.c whereas weekend occupancy slipped two p.c. Portfolio ADR improved barely within the quarter, and we should always generate incremental ADR progress as demand in our tech markets expands.” 

RevPAR efficiency for Chatham’s largest markets comprise 70 p.c of trailing twelve-month lodge EBITDA  (primarily based on EBITDA contribution over the past twelve months) is introduced beneath:

“To begin with, it’s nice to see the expansion in Silicon Valley and Bellevue as company journey demand continues to extend and because of this, resulting in occupancy progress of 12 p.c over final yr to a post-pandemic first quarter excessive of 67 p.c. San Francisco’s airport noticed worldwide passenger site visitors surpass 2019 ranges in February and March for the primary time since 2020. ADRs in Silicon Valley and Bellevue rose 5 p.c within the quarter, and as demand approaches 2019 ranges, at the moment 90 p.c of 2019, we may have the leverage to push charges increased,” asserted Dennis Craven, Chatham’s chief working officer. “Excluding Silicon Valley and Bellevue, first quarter RevPAR of $119 exceeds 2019 ranges by 3 p.c.”

Craven commented additional, “Persevering with an ideal development from the second half of final yr, our Higher New York and Washington, D.C., resorts are experiencing significant RevPAR beneficial properties attributable to robust underlying demand fundamentals. For the primary time for the reason that begin of the pandemic, RevPAR at our D.C. space resorts has surpassed 2019 ranges, and our Higher New York lodge RevPAR has exceeded 2019 for every of the previous 4 quarters. As we said final quarter, San Diego is poised for a powerful 2024 given the rise in giant conventions in 2024 and was capable of shake-off the impression terrible climate had on February conventions to have a strong quarter.

“Amongst our main markets, Los Angeles is the one market actually underperforming expectations as your complete market has been mushy. We gained RevPAR market share in our three Los Angeles space resorts through the quarter. The Austin market was anticipated to melt this quarter after a major quantity of company group demand final yr,” Craven concluded.

Roughly 64 p.c of Chatham’s lodge EBITDA over the past twelve months was generated from its extended-stay resorts, the best focus of extended-stay rooms of any public lodging REIT. First quarter 2024 occupancy, ADR and RevPAR for every of the corporate’s main manufacturers is introduced beneath (variety of resorts in parentheses):

The Homewood and Hilton Backyard Inn declines had been impacted by renovations.

Resort Operations Efficiency

The beneath chart summarizes key lodge working efficiency measures for the three months ended March 31, 2024 and 2023. Gross working revenue is calculated as lodge EBITDA plus property taxes, floor hire and insurance coverage (in tens of millions, apart from RevPAR and margin percentages):