Strategic Hotels and Resorts, Hersha Hospitality Trust and Extended Stay America all reported fourth-quarter earnings today, and while the two REITs were happy with their performances, ESA had some obstacles.
For Strategic, full-year 2013 revenue per available room increased 8.8 percent in the company's North American portfolio, while EBITDA margins expanded by 290 basis points. In the fourth quarter, average daily rate increased 6.2 percent over the same time last year to $292.75, while occupancy grew 2.4 points.
"We achieved outstanding operating and financial results across the board in 2013, leading the industry in RevPAR growth and margin expansion," said Raymond L. "Rip" Gellein, Jr., chairman and CEO of Strategic Hotels & Resorts, Inc. "We have very positive expectations for 2014, based on our group outlook, continued strength from the transient traveler, and our ability to continue expanding margins across the portfolio. We also look forward to continuing to deleverage the Company's balance sheet and reviewing growth opportunities that meet our strategic and financial thresholds. The luxury sector is well positioned for continued strength given the dearth of competitive new supply in virtually all of our major markets."
For Hersha, net income applicable to common shareholders was $32.8 million for the full yerar 2013 compared to net income applicable to common shareholders of $8.4 million in 2012. The increase in net income reported for the full-year and fourth quarter 2013 periods was primarily related to a gain on the disposition of 12 non-core hotel properties that closed during the fourth quarter.
On the report, Jay Shah, Hersha’s CEO said, “Our RevPAR quality improved materially in 2013 given the combination of capital recycling initiatives highlighted by our non-core portfolio sale, in addition to acquisitions undertaken in strong RevPAR markets such as Miami Beach and San Diego, and the opening of our Hyatt Union Square property."
For the full-year 2013 period, the company delivered consolidated RevPAR of $143.30, which represented record full-year RevPAR for the company, driven by growing corporate and leisure transient demand trends in U.S. gateway markets.
Extended Stay America, fresh off its entrance into the public market, reported a Q4 revenue increase of 7.3 percent to $268.8 million. RevPAR grew 5.7 percent to $37.82. However, it reported a net loss of $15.4 million compared to a net loss of $33.0 million in the same period last year.
Of the results, Extended Stay America's CEO Jim Donald commented, "We are proud of our strong results in 2013. Our revenue growth, while favorable, was restrained due to the limitations of our current revenue management capabilities pending the roll-out of our new system, coupled with renovation displacements and weather. These factors restricted growth in the fourth quarter of 2013 and the first quarter of 2014."