Chatham Sees Nearly 7% RevPAR Growth in Fourth Quarter

PALM BEACH, FL—Locally-based hotel REIT Chatham Lodging Trust saw its fourth quarter RevPAR increase 6.5% in the fourth quarter.

The fourth quarter RevPAR calculated out to $112 for Chatham's 34-wholly owned hotels. Excluding its property in Maitland, FL that has a significant amount of rooms out of service due to the unexpected replacement of its copper water supply lines, the owned portfolio's RevPAR in the fourth quarter was 7.5%, the company states.

Other key fourth quarter benchmarks include a 68% increase in adjusted EBITDA to $21.4 million and a similar 68% rise in its adjusted FFO to $12.7 million.

In the fourth quarter, Chatham invested $107 million to acquire four hotels comprising 575 rooms, plus an additional $28 million into a joint venture between Chatham and NorthStar Realty Finance Corp. that acquired a 48-hotel, 6,401-room portfolio of upscale, extended-stay and premium-branded, select-service hotels for a cash purchase price of approximately $1.0 billion from Inland American Real Estate Trust, Inc.

Chatham Lodging Trust president and CEO Jeffrey Fisher says that the firm's fourth quarter financial results were in-line with its guidance of RevPAR growth of 5.5% to 7.5% and adjusted FFO per share of $0.36-$0.39. “Our RevPAR performance continued its aggressive growth across our portfolio with 10 of our hotels producing double-digit RevPAR gains in the fourth quarter. Boston, Carlsbad, Dallas, Denver, Silicon Valley, Tyson's Corner, VA., and Washington, DC were our strongest markets,” Fisher says.

Fisher notes that its West Coast hotel markets continued to outperform the country with RevPAR at its eight West Coast properties up 10.3% in the fourth quarter.

“After factoring in the acquisition of the San Diego Gaslamp Residence Inn, which we expect will occur within the next week, approximately 50% of our portfolio will be located in key West Coast markets which bodes well for us moving forward,” he says.

Chatham reported in January 2015 it had entered into an agreement to acquire the 240-suite Residence Inn San Diego Downtown-Gaslamp District for $90 million. On Jan. 27, 2015, Chatham issued 4.0 million common shares at a price per share of $30, which resulting in net proceeds of approximately $118.5 million. Chatham, which invests in upscale, extended-stay hotels and premium-branded, select-service hotels, owns wholly or through its joint ventures 130 hotels.