ALISO VIEJO, CA-Locally based Sunstone Hotel Investors Inc. recently held its Q3 earnings call, showing that improving demand trends led to a 7.6% improvement in the company's comparable RevPAR. On the call, Ken Cruse, CEO said that the firm's continued focus on property-level efficiencies helped drive a 220 basis point expansion of our Hotel EBITDA Margins.
“As a result, our Adjusted FFO per diluted share increased by more than 30% as compared to the third quarter 2012,” said Cruse. “As reflected in our updated 2013 outlook, we estimate that the recent federal government shutdown will have an isolated impact on our fourth quarter Adjusted EBITDA.”
According to Cruse, the event will have “no lasting effect on portfolio performance following the fourth quarter. More importantly, our portfolio's leading indicators point to continued growth in 2014.”
During the third quarter “our operators set another record for same-store group bookings, and consequently our group pace for 2014 continues to strengthen,” adds Cruse. He recently also spoke on this topic at NAREIT's REITWorld 2013 conference in San Francisco, as GlobeSt.com reported.
“With record-level occupancies, our operators are well-positioned to increase average daily rate. Accordingly, we currently anticipate our negotiated corporate business to increase more than 7% portfolio-wide in 2014,” says Cruse. We believe Sunstone-specific factors, including the inclusion of hotels acquired during 2013 and the completion of major renovation work on a number of our hotels during 2013, should help fuel strong relative growth in 2014."
Cruse also explains that one pending acquisition is of the 802-room Hyatt Regency San Francisco in the CBD. “Consistent with our stated strategy, we expect this all-equity acquisition to improve the quality, scale and growth rate of our portfolio, while continuing to gradually deleverage our balance sheet,” he said.
As GlobeSt.com reported this summer, the firm closed on a major purchase in Bostom…the $250-million acquisition of the landmark 1,053-key Boston Park Plaza hotel.
As of Sept. 30, 2013, the company had approximately $184.4 million of cash and cash equivalents, including restricted cash of $84.1 million. Adjusting for the funds received from the company's offering and the funds used to purchase the Hyatt Regency San Francisco, the company's pro forma cash balance as of September 30, 2013 was approximately $193.1 million of cash and cash equivalents, including restricted cash of $84.1 million.
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Natalie Dolce
Natalie Dolce, editor-in-chief of GlobeSt.com and GlobeSt. Real Estate Forum, is responsible for working with editorial staff, freelancers and senior management to help plan the overarching vision that encompasses GlobeSt.com, including short-term and long-term goals for the website, how content integrates through the company’s other product lines and the overall quality of content. Previously she served as national executive editor and editor of the West Coast region for GlobeSt.com and Real Estate Forum, and was responsible for coverage of news and information pertaining to that vital real estate region. Prior to moving out to the Southern California office, she was Northeast bureau chief, covering New York City for GlobeSt.com. Her background includes a stint at InStyle Magazine, and as managing editor with New York Press, an alternative weekly New York City paper. In her career, she has also covered a variety of beats for M magazine, Arthur Frommer's Budget Travel, FashionLedge.com, and Co-Ed magazine. Dolce has also freelanced for a number of publications, including MSNBC.com and Museums New York magazine.
