News Details

BETHESDA, Md.--(BUSINESS WIRE)-- Pebblebrook Hotel Trust (NYSE: PEB):

Fourth Quarter and Year-to-Date Highlights

“Fourth quarter Same-Property Total Revenues grew 2.9% while expenses increased 2.6%, supporting modest margin expansion for the first time in 2025—an encouraging trend as demand continues to recover heading into 2026,” said Mr. Bortz. “Leisure transient customers outperformed our expectations, with fourth quarter weekend occupancies up 3.6% for the portfolio, and rising nearly 4.0% for the urban hotels, versus the prior year. This outperformance reflects both the strength of our upscale and luxury customer base, which has remained resilient amid economic uncertainty, and the leisure customers’ return to the cities.”

The Company’s fourth quarter results were further bolstered by an exceptionally strong rebound in San Francisco, which experienced strengthening in all demand segments, including business transient, group, convention, and leisure. The market is quickly regaining momentum and confidence, with pricing power just beginning to re-emerge.

“For the full year, our San Francisco hotels increased RevPAR by 17.5% and grew Hotel EBITDA by 58.5%, with fourth quarter RevPAR climbing by an impressive 37.9%,” continued Mr. Bortz. “We believe the recovery in San Francisco has a long runway, supported by limited new supply and robust economic growth, and we expect our hotels to be an increasingly meaningful contributor over the next several years, particularly given favorable convention bookings and pace, continued strength in AI-and tech-driven transient and group demand, and an ongoing recovery in leisure demand.”

Across the portfolio, the Company expects a stronger major-events calendar and improving demand in its urban markets to drive revenue and profitability growth in 2026. As revenues rebuild, Pebblebrook remains focused on expanding margins through continued disciplined cost control and a broad set of efficiency initiatives at both the property level and the corporate platform—supporting improved profitability and free cash flow. Same-Property EBITDA margins are forecasted to expand in 2026, as reflected in the Company’s Outlook. While Los Angeles and Washington, DC experienced market-specific disruptions that weighed on reported results in 2025, the underlying trend across the Company’s urban portfolio improved as the year progressed, and the resorts remained resilient.

“We’re bringing the same operating efficiency discipline we’ve applied at the property level to our corporate platform,” said Raymond D. Martz, Co-President and Chief Financial Officer. “Through a streamlined organizational structure, lower run-rate operating costs, and targeted process improvements supported by automation, we expect 2026 corporate cash general and administrative expenses to be modestly lower versus 2025. These actions reflect a more scalable platform—including an approximately 10% reduction in corporate staffing levels—and should increase free cash flow available for high-return capital allocation.”

Update on LaPlaya Recovery from Named Storms

The full restoration of LaPlaya Beach Resort & Club (“LaPlaya”), a 193-room luxury waterfront resort in Naples, Florida, was completed late in the second quarter following damage sustained from Hurricanes Helene and Milton in late 2024. In the third and fourth quarters, the Company undertook and completed significant targeted physical improvements to further strengthen the resort’s resilience against future weather events.

LaPlaya is included in Same-Property results for the first three quarters of 2025 and excluded from the fourth quarter for both 2025 and 2024 due to the impact of the 2024 storms. The Company recognized $3.1 million of business interruption (“BI”) insurance income in the fourth quarter, $1.1 million above its $2.0 million outlook, bringing the full-year BI insurance recovery to $12.7 million. This income contributes to Adjusted EBITDAre and Adjusted FFO, but is excluded from Same-Property Hotel EBITDA.

LaPlaya generated $24.5 million of Hotel EBITDA in 2025 despite significant construction disruption. Combined with the BI insurance income, the resort produced $37.2 million in Adjusted EBITDAre for the year. With the 2024 property and BI insurance hurricane claims now fully settled, no further BI insurance income is expected in 2026. Based on the Company’s 2026 Outlook, LaPlaya is forecasted to generate $28.0 to $30.0 million of Same-Property Hotel EBITDA and will be included in Same-Property results for all four quarters.

Update on Strategic Dispositions

The Company successfully completed two hotel sales in 2025, generating $116.3 million of gross proceeds, despite a challenging environment that limited industry transaction activity. These dispositions reduced exposure to Chicago and Los Angeles, lowered future capital requirements, and enabled the Company to redeploy proceeds toward debt reduction and accretive common and preferred share repurchases.

Proceeds from the dispositions were used to reduce outstanding debt by $100 million, repurchase $5 million of liquidation preference preferred securities outstanding, and support broader balance sheet strengthening and shareholder value initiatives.

Capital Investments and Strategic Property Redevelopments

During the fourth quarter, the Company invested $22.7 million in capital improvements across its portfolio, and in 2025, it invested $74.6 million. With the bulk of its multi-year $525 million strategic redevelopment program now complete, Pebblebrook has transitioned into a lower, more normalized level of annual capital investments. For 2026, the Company anticipates investing $65 to $75 million into the portfolio. This lower, normalized capital run-rate is an important tailwind in 2026, supporting higher discretionary free cash flow for debt reduction and opportunistic share repurchases.

Newport Harbor Island Resort continued its post-redevelopment ramp in 2025, its first full year of operations, with Total RevPAR increasing 38.5% and Hotel EBITDA growing $9.3 million to $17.7 million versus the pre-renovation period of the 12 months ending September 2023—illustrating the growth towards stabilization the Company expects to continue in 2026. In addition, other recently redeveloped properties, including Estancia La Jolla Hotel & Spa and Jekyll Island Club Resort among others, are also gaining share and improving profitability.

Balance Sheet and Share Repurchases

As of December 31, 2025, the Company held $196.2 million in cash, cash equivalents, and restricted cash, with $642 million of available capacity on its $650 million senior unsecured revolving credit facility. Additionally, net debt to trailing 12-month corporate EBITDA was 5.9x, and the fixed charge ratio was 1.8x.

On February 11, 2026, the Company closed on a new $450 million term loan, maturing in February 2031, with $360 million borrowed and $90 million available to be drawn through December 15, 2026. Concurrently, the Company paid off its $360 million term loan maturing October 2027 and the remaining $40 million mortgage related to the Margaritaville Hollywood Beach Resort. The $90 million delayed draw term loan, along with anticipated cash on hand at maturity, is intended to fund the remaining balance of the Company’s 1.75% Convertible Notes due December 2026. Outside of the December 2026 convertible notes, the Company has no significant debt maturities until 2028.

Currently, the Company’s consolidated debt and convertible notes bear an estimated 4.1% weighted-average interest rate and a weighted-average debt maturity of 3.1 years, with 98% effectively fixed at 4.1% and approximately 98% unsecured.

Throughout 2025, the Company repurchased 6.3 million common shares at an average price of $11.37 per share. Since October 2022, the Company has repurchased nearly 18.5 million common shares—approximately 14% of outstanding shares—at an average price of $13.37, representing a 43% discount to the midpoint of the Company’s most recently published NAV per share.

During the year, the Company also repurchased 0.5 million preferred shares at an attractive 24.3% average discount to liquidation preference, reducing total outstanding preferred equity securities to $754.3 million.

Common and Preferred Dividends

On December 15, 2025, the Company declared a quarterly cash dividend of $0.01 per share on its common shares and a regular quarterly cash dividend for the following preferred shares of beneficial interest:

• $0.39844 per 6.375% Series E Cumulative Redeemable Preferred Share;
• $0.39375 per 6.3% Series F Cumulative Redeemable Preferred Share;
• $0.39844 per 6.375% Series G Cumulative Redeemable Preferred Share; and
• $0.35625 per 5.7% Series H Cumulative Redeemable Preferred Share.

Update on Curator Hotel & Resort Collection

Curator Hotel & Resort Collection (“Curator”) is a global alliance of experiential, independent lifestyle hotels and resorts, founded by Pebblebrook in partnership with leading independent operators. As of December 31, 2025, Curator included 91 member properties and 121 preferred vendor agreements, providing members with advantageous pricing, enhanced contract terms, and early access to innovative technologies, including AI and robotics. These benefits also extend across Pebblebrook’s portfolio. Curator’s mission is to strengthen independent hotels through best-in-class agreements, shared services, and technology that enhances performance and elevates the guest experience.

2026 Outlook

The Company’s 2026 Outlook assumes no acquisitions or dispositions and reflects a base-case operating environment. The Outlook excludes the impact of macroeconomic deterioration, significant policy shocks, major weather events (except for Winter Storm Fern), and federal government shutdowns. Preliminary January Same-Property RevPAR growth is estimated at 4.6%, reflecting favorable demand, despite the negative year-over-year loss of the Inauguration and the winter storm impact. February Same-Property RevPAR growth is trending significantly higher than January’s growth. All properties owned as of December 31, 2025, are incorporated into the Same-Property portfolio for 2026 and 2025.

Fourth Quarter 2025 Earnings Call

The Company will conduct its quarterly analyst and investor conference call on Thursday, February 26, 2026, beginning at 9:00 AM ET. Please dial (877) 407-3982 approximately ten minutes before the call begins to participate. A live webcast of the conference call will also be available through the Investor Relations section of www.pebblebrookhotels.com. To access the webcast, click on https://investor.pebblebrookhotels.com/news-and-events/webcasts/default.aspx ten minutes before the conference call. A replay of the conference call webcast will be archived and available online.

About Pebblebrook Hotel Trust

Pebblebrook Hotel Trust (NYSE: PEB) is a publicly traded real estate investment trust (“REIT”) and the largest owner of urban and resort lifestyle hotels and resorts in the United States. The Company owns 44 hotels and resorts, totaling approximately 11,000 guest rooms across 13 urban and resort markets. For more information, visit www.pebblebrookhotels.com and follow @PebblebrookPEB.

This press release contains certain “forward-looking statements” made pursuant to the safe harbor provisions of the Private Securities Reform Act of 1995. Forward-looking statements are generally identifiable by the use of forward-looking terminology such as “may,” “will,” “should,” “potential,” “intend,” “expect,” “seek,” “anticipate,” “estimate,” “approximately,” “believe,” “could,” “project,” “predict,” “forecast,” “continue,” “assume,” “plan,” references to “outlook,” or other similar words or expressions. Forward-looking statements are based on certain assumptions and can include future expectations, future plans and strategies, financial and operating projections and forecasts, and other forward-looking information and estimates. Examples of forward-looking statements include the following: descriptions of the Company’s plans or objectives for future capital investment projects, operations, or services; forecasts of the Company’s future economic performance; forecasts of hotel industry performance; and descriptions of assumptions underlying or relating to any of the foregoing expectations including assumptions regarding the timing of their occurrence. These forward-looking statements are subject to various risks and uncertainties, many of which are beyond the Company’s control, which could cause actual results to differ materially from such statements. These risks and uncertainties include, but are not limited to, the state of the U.S. economy and the supply of hotel properties, and other factors as are described in greater detail in the Company’s filings with the SEC, including, without limitation, the Company’s Annual Report on Form 10-K for the year ended December 31, 2025. Unless legally required, the Company disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events, or otherwise.

For further information about the Company’s business and financial results, please refer to the "Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” sections of the Company’s filings with the U.S. Securities and Exchange Commission, including, but not limited to, its Annual Report on Form 10-K and Quarterly Reports on Form 10-Q, copies of which may be obtained at the Investor Relations section of the Company’s website at www.pebblebrookhotels.com.

All information in this press release is as of February 25, 2026. The Company undertakes no duty to update the statements in this press release to conform the statements to actual results or changes in the Company’s expectations.

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