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Takeaway: We expect Q1 RevPAR to exceed guidance for most lodgers but we prefer HOT.

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: Considering the impact of Sandy and the calender shift, 4Q was strong. Guidance and tone on the call was also better than other lodging companies


  • MIXED:  Group bookings are up 4% in room nights for 2013.  About 75% of group room nights for 2013 are on the books already.  Group revenue on the books for 2013 is up 6.5% in revenues, lower than previous guidance due to Sandy impact.  Mgmt is quite bullish regarding the group outlook in 2013.
  • PREVIOUSLY:  "Our activity for 2013 continues to show sequential improvement with revenues on the books now 8% ahead of the prior year. A great majority of this improvement is happening in our larger group hotels, which are benefiting as customers began to plan more proactively. Looking at the fourth quarter and into next year, we continue to be encouraged by the positive trends in group business. While current booking activity or current quarter booking activity will likely slow somewhat because fewer room blocks are available.  Overall, as we look at the quarter, we are still expecting group to be certainly up meaningfully in the fourth quarter. We do not expect group to be as strong in Q4 as it was in Q3."


  • SAME:  Occupancy has passed the 2007 peak, but still remain below its historic peak of 78%.  2013 REVPAR growth (+5-7%) will be driven mostly by rate.
  • PREVIOUSLY:  "While it's premature to offer any specific guidance relative to RevPAR or revenue growth for 2013, we do believe that the fundamentals for our business continue to be attractive. We expect to enter next year with an occupancy level higher than we had in 2007, the strong booking pace I referenced and supply at a near record low of 0.5% in our markets. We are very confident that our managers will have success in negotiating higher special corporate rates this fall. Additionally, international travel continues to grow at a high-single-digit rate, adding demands in our priority gateway markets. All of these factors should result in solid RevPAR growth in the coming year."


  • BETTER:  4Q REVPAR +10.2%, expect Boston to have another good year due to solid group bookings
  • PREVIOUSLY: "We expect our Boston hotels to have a good fourth quarter due to strength in group revenues and an expectation of continuing strong transient rates."


  • SAME:  REVPAR increased 10.9% (ADR: +6%, OCCU: 4%) due to favorable business mix.  2013 will be affected by the San Francisco Marriott Marquis renovation.
  • PREVIOUSLY:  "We expect our San Francisco hotels to continue to perform very well in the fourth quarter, as strong group and transient demand will allow us to continue to drive rate."


  • BETTER:  Outperformed expectations (+12.3% REVPAR, +4% occup, +7% rate); Hawaii market for 2013 will be strong due to group bookings though renovations will have some impact.
  • PREVIOUSLY:  "We expect our Hawaiian hotels to have a good fourth quarter."


  • SAME:  REVPAR increased 1.7% due to Hurricane Sandy and various renovations.  Expect New York to be a top performing market in 2013.
  • PREVIOUSLY:  "Results were affected by renovations at three hotels, driving ADR growth in New York has been challenging this year and we expect that trend to continue in the fourth quarter."


  • SAME:  RevPAR increased 8.8%; expect Chicago hotels to continue to do well in 2013.
  • PREVIOUSLY:  "RevPAR increased 3.5%, driven by an increase in rate of nearly 3%, a slight improvement in occupancy. We expect our Chicago hotels to perform much better in the fourth quarter due to better group and transient demand."


  • SAME:  REVPAR: -4.3% (Hurricane Sandy and renovations).  Expect 2013 to be better than 2012 though government spending will continue to be sluggish.   
  • PREVIOUSLY:  "Both group and transient demand were weak as there was little activity on Capitol Hill and election-year activities were outside of D.C. Results in the quarter were hurt by the rooms renovation at the Hyatt Regency on Capitol Hill. We have a series of meeting space and rooms renovations scheduled for the fourth quarter and we expect D.C. to continue to underperform the portfolio. We expect 2013 to be a better year for D.C."


  • SAME:  F&B revenues only grew 1% due to challenging comps.
  • PREVIOUSLY:  "We are anticipating lower growth in F&B revenue and profitability in the fourth quarter of this year due to an unfavorable comparison for 2011, where F&B revenue grew 6.8%, as well as the anticipated impact of the challenging holiday and election calendar."


  • WORSE:  Expect unallocated costs to increase more than inflation, particularly for sales and marketing
  • PREVIOUSLY:  "We expect unallocated cost to increase in line with inflation, particularly for sales and marketing where higher revenues will increase cost. We also expect utilities to decline in the quarter albeit at a much lower level of decline than we experienced in the third quarter."


  • SLIGHTLY BETTER:  Property taxes increased 5% in 2012
  • PREVIOUSLY:  "At this point, we expect the full year increase in the 6% area as we have been successful in reducing several current year assessments and challenging prior year assessments."


  • SAME:  Expects to be a net acquirer in 2013 and for M&A activity to be roughly equivalent for 2013 as for 2012 for the market as a whole. 
  • PREVIOUSLY:  "As we look at 2013, I would say that, while we're certainly happy with the disposition pricing that we seem to be attracting on the assets that we're looking at selling, I also think that we feel fairly comfortable that this is going to be an extended cycle. And so I would expect that we would continue to be active in 2013. Whether we're a net acquirer or a net seller probably depends more on how attractive the actual acquisition opportunities that develop over the course of 2013. But I think by and large our intent is to continue to be active in the year. And if I were trying to plan it out perfectly, I'd probably say we'd probably be about neutral in 2013."


  • SAME:  Total capital spending for 2013 (Redevelopment/ ROI/ Acquisition/ Renewal & Replacement) at the midpoint is $420MM, a substantial decline from the $638MM spent in 2012.
  • PREVIOUSLY:  "We're fairly comfortable that our capital spending in 2013 will decline compared to the levels that we had in 2012 and it should be by a fairly significant amount."