Summit Hotel Properties: Offering and Resale of Up to 12.9 Million Shares of Common Stock

Summit Hotel Properties, a real estate investment trust, owns 97 lodging properties with 14,553 guestrooms across 25 states. Its portfolio operates under franchise brands owned by Marriott, Hilton, Hyatt, and IHG. The company holds both general and limited partnership interests in Summit Hotel OP, LP, which conducts all its operations.

Summit Hotel Properties, Inc. (NYSE: INN), a real estate investment trust (REIT) with 97 lodging properties and 14,553 guestrooms across 25 states, has reported its financial results for the first quarter of 2025. The company's portfolio operates under franchise brands owned by Marriott, Hilton, Hyatt, and IHG. The REIT's limited partnership, Summit Hotel OP, LP, conducts all its operations.

Key highlights from the report include:

1. Same Store RevPAR Increase: The company's same store RevPAR (Revenue Per Available Room) increased by 1.5% during the first quarter. This metric measures the revenue generated per available room, indicating a positive trend in revenue growth for existing properties.

2. Debt Refinancing: Summit Hotel Properties closed on a $275 million term loan facility to refinance the majority of its convertible notes maturing in February 2026. The term loan allows for a delayed draw for up to 12 months, eliminating debt maturity risk until 2027 and preserving the attractive 1.5% coupon rate on the convertible notes through maturity.

3. Share Repurchase Program: The Board of Directors authorized a $50 million share repurchase program, enabling the company to return capital to shareholders opportunistically. This move reflects confidence in the long-term fundamentals of the business and the lodging industry's expected multi-year growth cycle.

4. Financial Performance: The company reported a net loss of $4.7 million for the first quarter of 2025, compared to a net loss of $2.1 million in the same period in 2024. Pro forma RevPAR increased by 0.9% to $124.99, while pro forma ADR (Average Daily Rate) increased by 0.8% to $173.06. Pro forma occupancy increased by 0.1% to 72.2%.

5. Hotel EBITDA Margin: The company's pro forma hotel EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) margin contracted by approximately 48 basis points to 35.6%, while same store hotel EBITDA margin contracted by approximately 49 basis points to 35.9%.

6. Outlook: Despite a softening in lodging demand in early March due to weaker government and inbound international travel, the company remains confident in the long-term fundamentals of its business. The company's high-quality portfolio, strong balance sheet, and ample liquidity provide flexibility to navigate near-term softness in fundamentals.

Overall, Summit Hotel Properties' Q1 2025 results reflect a positive trend in revenue growth and a strategic approach to debt management and capital return. The company's outlook remains optimistic, with expectations for a reacceleration in demand in the lodging industry.

References:
[1] https://www.prnewswire.com/news-releases/summit-hotel-properties-reports-first-quarter-2025-results-302443172.html