Hotel REIT financial performance for Q4'21 roughly in line with prior quarter

Hotel real estate investment trust performance for the fourth quarter of 2021 was overall roughly in line with the prior quarter, remaining below pre-pandemic levels.

Recurring EBITDA for seven of the 16 hotel REITs improved quarter over quarter, while 9 REITs logged quarterly drops, according to S&P Global Market Intelligence data. That being said, all 16 hotel REITs logged positive year-over-year growth compared to 2020.

Operating funds from operations followed a similar trend. Five hotel REITs logged quarter-over-quarter growth and nine recorded quarterly declines. Year over year, all hotel REITs reported positive growth compared to 2020.

Market Intelligence defines operating FFO as funds from operations adjusted for extraordinary items or other nonrecurring items at the discretion of the company. Hotel REITs sometimes refer to this as normalized FFO, core FFO or adjusted FFO.

Same-store occupancy dipped in the fourth quarter, down to 57.2% on a median basis.

Meanwhile, same-store revenue per available room grew in the recent quarter, up to $136.01 on a median basis from $115.24 the quarter prior. Year over year, same-store RevPAR was up 183.9%.

Host Hotels & Resorts Inc.'s CEO James Risoleo said on a fourth-quarter earnings call that the fourth quarter marked the REIT's highest quarterly RevPAR since the onset of the pandemic, and the expectation for March 2022 was a significant increase in business.

While conditions continue to improve for hotel REITs, share prices still sit below their pre-pandemic levels.

As of March 24, the Dow Jones U.S. Real Estate Hotels index was 14.9% lower than its level on Dec. 31, 2019. For comparison, the more broad Dow Jones Equity All REIT index was up 14.6% over the same period, while the S&P 500 was up 39.9%.