In an effort to evaluate performance and as a follow up to our YouTube, we compare how the quarter measured up to previous management commentary and guidance.






  • BETTER: HST raised FY RevPAR and EBITDA guidance.  Group bookings are improving and have given management confidence in a robust 2013.



  • LITTLE BETTER:  Group bookings were up 9% in 3Q while group bookings for 4Q are up 7.5% YoY.  2013 group activity is now 8% higher YoY.  Much of the improvement has involved HST's larger group's hotels.  
  • PREVIOUSLY:  "We continue to be encouraged by the positive trends in group business. Total bookings for the remainder of the year are now more than 7.5% ahead of last year's pace, and the overall rate for the third and fourth quarters has increased well over 2%, indicating revenue improvement of 10%. We're also seeing the positive booking activity extend into 2013 in both demand and rate, indicating that our group hotels are benefiting from increased business spending and should continue to perform well for the remainder of this year and next."


  • SAME:  Still expect to sell $300-400MM of assets by the end of 2012 although some closings may slip into 2013.  HST expects to be an active seller in 2013 with the goal of improving the quality of their portfolio
  • PREVIOUSLY:  "While the sale market is difficult to predict, the guidance assumes we complete incremental sales in the $300 million to $400 million range by year-end. We do intend to be an active seller over the next two and three years. And as we are consistent with what we've described in the past, a number of these suburban assets, both in core and non-core markets and airport locations, leaving out the ones that are sort of directly attached to the airport, those are the hotels that would be high on our priority list in terms of hotels that should be sold."


  • BETTER:  The recently renovated hotels have seen REVPAR increases of 38% in 3Q and YTD when compared to the pre-construction period in 2010.
  • PREVIOUSLY:  "It is worth noting that we are seeing great results at our three recently redeveloped hotels: the Chicago O'Hare Marriott, the Atlanta Perimeter Marriott and the Sheraton Indianapolis, where REVPAR is running better than 35% ahead of pre-renovation levels."  


  • SAME:  REVPAR grew 20.8% (occupancy: +11%, ADR: +3%) due to excellent growth in rooms and F&B revenues
  • PREVIOUSLY:  "We expect Philadelphia to be a top performing market in the third quarter due to strong group and transient demand, which should allow us to drive pricing."


  • SAME:  REVPAR grew 3.5% (occupancy: slight improvement, ADR: +3%).  Poor city-wide and group demand led to underperformance in 3Q.  
  • PREVIOUSLY:  "We expect our Chicago hotels to underperform our portfolio in the third quarter due to lower levels of citywide and group demand when compared to the third quarter of 2011."


  • SAME:  REVPAR grew 15.4% (occupancy: +2%, ADR: +12%). Outperformance was driven by strong group demand, which allowed HST to benefit from rate compression for both group and transient business
  • PREVIOUSLY:  "We expect our Boston hotels to have a strong third quarter."


  • SAME:  REVPAR 12.7% (occupany: +3%, ADR: +9).  Strong occupancy level allowed for better mix shift to higher-rated transient segments
  • PREVIOUSLY:  "We expect our San Francisco hotels to continue to perform very well in the third quarter as strong demand will allow us to continue to drive rate."


  • WORSE:  REVPAR increased 4.6% (occupancy: +2%, ADR: +2.1%).  Results were affected by renovations at three hotels.  Driving ADR growth has been challenging.
  • PREVIOUSLY:  "REVPAR for our New York hotels increased 4.8% due to growth in ADR. Results were negatively impacted by the second and final stage of the rooms renovations at the New York Marriott Marquis and the Sheraton New York and a rooms renovation at the W Union Square....We expect our New York hotels to perform better in the third quarter."


  • BETTER:  REVPAR improved 11% (occupancy: +2%, ADR: +9%) on the back of group and transient strength
  • PREVIOUSLY:  "Our Miami and Fort Lauderdale hotels struggled in the quarter as REVPAR declined 20 basis points....The weakness was due to less transient and group demand. We expect our Miami and Fort Lauderdale hotels to perform better in the third quarter due to better group bookings."


  • BETTER:  Excluding the Sheraton Roma under renovation, REVPAR (in constant euros) increased 4.1%. Inbound travel to the Eurozone from the U.S., UK, and Asia, and the Middle East continues to be strong and a major source of euro lodging demand.
  • PREVIOUSLY:  2H vs 1H Europe REVPAR:  "We generally would expect it to be in line with what we've seen in the first half of the year."


  • BETTER:  REVPAR was strong in 3Q
  • PREVIOUSLY:  "The one market that's underperformed year-to-date has really been Brussels. But we have a sense that that will do a little bit better in the second half of the year." 


  • WORSE:  While F&B was good in 3Q, HST expects lower F&B revenues due to tough comps and an unfavorable calendar (e.g. election, Jewish holiday) in 4Q
    • We continue to see improvements in catering, meeting room rental and audio-visual revenues, as well as reductions in food and beverage cost as a percentage of revenue.  We expect the positive trends in group demand to continue which should help drive growth in banquet and audio-visual revenues and good F&B flow through.


  • SAME:  In 3Q, most of the comparable REVPAR increase came from rate.  Rate increased 4.7% while occupancy increased 2.1%.  The improvements led to strong margin growth in the Q. Rate growth will be increasingly more important in 4Q.
  • PREVIOUSLY:  "Looking to the rest of 2012, we expect that comparable hotel REVPAR will be driven more by both occupancy and rate growth, but rate growth should be increasingly more important throughout the year. The additional rate growth should lead to solid rooms' flow through even with growth in wage and benefit cost.”


  • SLIGHTLY BETTER:  Increased 3.2% in 3Q.  HST expects unallocated costs to increase in line with inflation particularly for sales and marketing.
  • PREVIOUSLY:  "We expect unallocated cost to increase more than inflation,particularly for sales and marketing where higher revenues will increase cost.


  • BETTER:  Utility costs declined 9.6% in 3Q. Expect utility costs to continue to be lower in 4Q but not as much as 3Q.  Property tax estimates remain unchanged at +6% for 2012.
  • PREVIOUSLY: “We also expect utilities to decline slightly for the full year."


  • SAME:  HST remains very confident that their managers will have success in negotiating higher special corporate rates this fall.
  • PREVIOUSLY:  "We will certainly be pushing for higher pricing next year to reflect the more competitive market conditions."

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