Business
SUNSTONE HOTEL INVESTORS REPORTS RESULTS FOR FOURTH QUARTER AND FULL YEAR 2024
Sunstone Hotel Investors, Inc. (the "Company" or "Sunstone") (NYSE: SHO) today announced results for the fourth quarter and full year ended December 31, 2024.
About this update from Sunstone Hotel Investors, Inc.
[{"type":"text","content":" ALISO VIEJO, Calif. , Feb. 21, 2025 /PRNewswire/ -- Sunstone Hotel Investors, Inc. (the "Company" or "Sunstone") (NYSE: SHO) today announced results for the fourth quarter and full year ended December 31, 2024 .","length":229,"tagName":"p"},{"type":"text","content":" Fourth Quarter 2024 Operational Results (as compared to Fourth Quarter 2023): ","length":77,"tagName":"p"},{"type":"list","items":[{"val":[{"type":"text","content":" Net Income: Net income was $0.8 million as compared to $127.0 million . Excluding the gain on the hotel sold during the fourth quarter 2023, net income would have been $3.2 million .","length":180,"tagName":"p"}]},{"val":[{"type":"text","content":" Comparable RevPAR: Comparable RevPAR decreased 1.1% to $199.07 . The average daily rate was $304.85 and occupancy was 65.3%. Excluding The Confidante Miami Beach as it transitions to Andaz Miami Beach, RevPAR increased 1.0%. Excluding The Confidante Miami Beach and the Hilton San Diego Bayfront, which was negatively impacted by labor activity in the fourth quarter of 2024, RevPAR increased 2.4%.","length":402,"tagName":"p"}]},{"val":[{"type":"text","content":" Adjusted EBITDA re : Adjusted EBITDA re decreased 12.0% to $48.1 million .","length":70,"tagName":"p"}]},{"val":[{"type":"text","content":" Adjusted FFO: Adjusted FFO attributable to common stockholders per diluted share decreased 15.8% to $0.16 .","length":106,"tagName":"p"}]}],"tagName":"ul","bulletedList":true,"length":758,"olType":false},{"type":"text","content":" Full Year 2024 Operational Results (as compared to Full Year 2023): ","length":67,"tagName":"p"},{"type":"list","items":[{"val":[{"type":"text","content":" Net Income: Net income was $43.3 million as compared to $206.7 million . Excluding the gain on the hotel sold during 2023, net income would have been $82.9 million .","length":163,"tagName":"p"}]},{"val":[{"type":"text","content":" Comparable RevPAR: Comparable RevPAR decreased 2.4% to $214.06 . The average daily rate was $311.13 and occupancy was 68.8%. Excluding The Confidante Miami Beach as it transitions to Andaz Miami Beach, RevPAR was $221.73 and was generally unchanged as compared to the prior year. Excluding The Confidante Miami Beach and the Hilton San Diego Bayfront, which was negatively impacted by labor activity in the third and fourth quarters of 2024, RevPAR increased 0.9%.","length":468,"tagName":"p"}]},{"val":[{"type":"text","content":" Adjusted EBITDA re : Adjusted EBITDA re decreased 12.8% to $229.7 million .","length":71,"tagName":"p"}]},{"val":[{"type":"text","content":" Adjusted FFO: Adjusted FFO attributable to common stockholders per diluted share decreased 15.8% to $0.80 .","length":106,"tagName":"p"}]}],"tagName":"ul","bulletedList":true,"length":808,"olType":false},{"type":"text","content":"Information regarding the non-GAAP financial measures disclosed in this release is provided below in "Non-GAAP Financial Measures." Reconciliations of non-GAAP financial measures to the most comparable GAAP measure for each of the periods presented are included later in this release.","length":294,"tagName":"p"},{"type":"text","content":" Bryan A. Giglia , Chief Executive Officer, stated, "In 2024, we began to realize the benefits of the investments we have made in our portfolio, which we expect will contribute to growth for the next several years. While industry fundamentals were not as robust in 2024 as we had hoped, we were pleased with the strong performance at our newly converted The Westin Washington, DC Downtown, which is now one of the premier convention hotels in the city. Additionally, our hotels in Boston and San Antonio benefited from strong group and transient demand, while our Wine Country resorts grew occupancy and profitability."","length":627,"tagName":"p"},{"type":"readMore"},{"type":"text","content":"Mr. Giglia continued, "During 2024, we successfully executed our strategy of recycling capital, investing in our portfolio, and returning capital to shareholders. We redeployed capital, acquiring the Hyatt Regency San Antonio Riverwalk at a compelling current yield with attractive future growth opportunities. Building on our success with the conversion of The Westin Washington, DC Downtown, we are now positioned to generate further growth from other recent investments in our portfolio. As we look ahead, our earnings in 2025 are expected to benefit from the recently completed conversion of the Marriott Long Beach Downtown and the debut of Andaz Miami Beach in the first quarter. Our strong liquidity position and embedded earnings growth provide for a well-covered dividend and the ability to repurchase our common stock at a discount to NAV, which is evidenced by our return of nearly $100 million to shareholders during the year. We believe that our active capital recycling, investment in our portfolio to drive future growth, and meaningful return of capital will position Sunstone for further success in 2025."","length":1132,"tagName":"p"},{"type":"table","headerItems":[],"items":[{"val":[{"colspan":"18","rowspan":"1","style":"PADDING-RIGHT:0.17em;PADDING-LEFT:0.17em;VERTICAL-ALIGN:BOTTOM;TEXT-ALIGN:LEFT;","val":[{"type":"text","content":" Unaudited Selected Statistical and Financial Data ($ in millions, except RevPAR, ADR and per share amounts) ","length":107,"tagName":"p","attribs":{}}]}]},{"val":[{"colspan":"1","rowspan":"1","style":"PADDING-RIGHT:0.33em;PADDING-LEFT:0.17em;VERTICAL-ALIGN:BOTTOM;TEXT-ALIGN:RIGHT;","val":[{"type":"text","content":" ","length":0,"tagName":"p","attribs":{}}]},{"colspan":"1","rowspan":"1","style":"PADDING-RIGHT:0.33em;PADDING-LEFT:0.17em;VERTICAL-ALIGN:BOTTOM;TEXT-ALIGN:RIGHT;","val":[{"type":"text","content":" 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","length":49,"tagName":"p","attribs":{}}]}]},{"val":[{"colspan":"1","rowspan":"1","style":"PADDING-RIGHT:0.17em;PADDING-LEFT:0.17em;","val":[{"type":"text","content":" (2) ","length":3,"tagName":"p","attribs":{}}]},{"colspan":"1","rowspan":"1","style":"PADDING-RIGHT:0.17em;PADDING-LEFT:0.17em;","val":[{"type":"text","content":" RevPAR Growth reflects comparison to full year 2023. ","length":52,"tagName":"p","attribs":{}}]}]},{"val":[{"colspan":"1","rowspan":"1","style":"PADDING-RIGHT:0.33em;PADDING-LEFT:0.17em;","val":[{"type":"text","content":" ","length":0,"tagName":"p","attribs":{}}]},{"colspan":"1","rowspan":"1","style":"PADDING-RIGHT:0.33em;PADDING-LEFT:0.17em;","val":[{"type":"text","content":" ","length":0,"tagName":"p","attribs":{}}]}]}],"length":110},{"type":"text","content":" 2024 Highlights ","length":15,"tagName":"p"},{"type":"text","content":" Hyatt Regency San Antonio Riverwalk. In April 2024 , the Company completed the acquisition of the 630-room Hyatt Regency San Antonio Riverwalk. The exceptionally well-located hotel is situated directly between San Antonio's famous Riverwalk and the Alamo , two of the most visited tourist sites in Texas . The hotel outperformed the Company's expectations in 2024 and generated an attractive 10.1x multiple on the net purchase price, inclusive of key money incentives offered by the hotel's manager. The Company believes there are opportunities to continue to grow earnings at the hotel from the completion of the adjacent Alamo Visitor Center and Museum and from various asset management and investment initiatives. ","length":738,"tagName":"p"},{"type":"text","content":" Marriott Long Beach Downtown . In 2024, the Company completed its renovation and rebranding of the Renaissance Long Beach and the hotel debuted as Marriott Long Beach Downtown. The fully renovated hotel boasts a reimagined lobby, redesigned guestrooms, new food and beverage offerings, and reinvigorated meeting space. The repositioned hotel is attracting higher-quality business and higher rates and should contribute meaningfully to the Company's earnings in 2025.","length":469,"tagName":"p"},{"type":"text","content":" Andaz Miami Beach . In 2024, the Company made substantial progress on its conversion of The Confidante Miami Beach to Andaz Miami Beach. The transformative renovation encompasses all aspects of the resort and will meaningfully enhance the earnings potential of the asset. Andaz Miami Beach is expected to debut in the first quarter of 2025 and drive earnings growth in 2025 and beyond.","length":384,"tagName":"p"},{"type":"text","content":" New Unsecured Term Loan and JW Marriott New Orleans Mortgage Repayment. In the fourth quarter of 2024, the Company entered into a new $100.0 million term loan agreement and used substantially all of the proceeds to repay the $72.1 million loan secured by the JW Marriott New Orleans. Following the repayment of the JW Marriott New Orleans loan, all of the Company's hotels are unencumbered and, inclusive of extension options, the Company has no debt maturities prior to 2026.","length":485,"tagName":"p"},{"type":"text","content":" Stock Repurchase Program . During 2024, the Company repurchased 2,764,837 shares of its common stock at an average purchase price of $9.83 per share for a total repurchase amount before expenses of $27.2 million . The average purchase price per share represents a substantial discount to consensus estimates of net asset value and implies a highly attractive valuation multiple on the Company's stabilized cash flow. The Company currently has $427.5 million remaining under its existing stock repurchase program authorization.","length":528,"tagName":"p"},{"type":"text","content":" Balance Sheet and Liquidity Update ","length":34,"tagName":"p"},{"type":"text","content":"As of December 31, 2024 , the Company had $180.3 million of cash and cash equivalents, including restricted cash of $73.1 million , total assets of $3.1 billion , including $2.9 billion of net investments in hotel properties, total debt of $845.0 million and stockholders' equity of $2.1 billion .","length":297,"tagName":"p"},{"type":"text","content":" Capital Investments Update ","length":26,"tagName":"p"},{"type":"text","content":"The Company invested $47.1 million and $157.4 million into its portfolio during the fourth quarter and year ended December 31, 2024 , respectively. The majority of the 2024 investment consisted of the conversions of Andaz Miami Beach and the Marriott Long Beach Downtown and a soft goods renovation at Wailea Beach Resort.","leng...
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