IRVING, TX-FelCor Lodging Trust Inc.’s third quarter operating results were strong enough for the REIT’s executive team to express confidence not only in the future of the hospitality sector, but also the future performance of its own portfolio.
“Our confidence in a sustained recovery is growing,” said Andrew J. Welch, FelCor's executive vice president and CFO, during the REIT’s earnings conference call. FelCor owns interests in 84 hotels and resorts located in 23 states and Canada.
The REIT’s revenues certainly indicate the recovery is well underway: same-store revenue per available room (RevPAR) at FelCor’s 82 consolidated hotels increased 6.3% for the quarter compared to the same period in 2009. The RevPAR increase for the quarter was driven by a 4.2% occupancy increase to 72.7% and a 2.1% ADR increase to $120.85, compared to the same period in 2009.
“ADR growth accelerated through the quarter – the first quarterly increase in ADR in two years,” Welch commented. “We expect four quarter RevPAR to be stronger than it has been this year. ADR should account for more than 50% of RevPAR growth.”
During the call, Welch pointed out that RevPAR grew during the third quarter increased at 61 of the REITs hotels and in every major market, except for Orlando, which has seen a great deal of new supply. He attributed much of the improvement to the lack of new hotel rooms across the US; only four of the REIT’s top 20 markets have rooms under construction.
“We expect trends to continue to improve,” Welch said. Moreover, he noted that hotel cash flows and values are recovering, as well as the capital markets.
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
