Xenia Hotels & Resorts has announced an impressive financial performance for the second quarter of 2026, exceeding initial projections and leading to an upward revision of its full-year earnings and revenue forecasts. The company's strategic focus on high-end properties and effective capital management appears to be yielding significant benefits, despite some market-specific challenges. This positive outlook is underpinned by strong demand across both transient and group segments, alongside proactive portfolio enhancements.
Xenia Hotels & Resorts Shines in Q2 2026 with Upgraded Financial Outlook
On Thursday, July 30, 2026, Xenia Hotels & Resorts held its second-quarter earnings conference call, featuring key executives Marcel Verbaas (Chairman and CEO), Barry A. N. Bloom (President and COO), Atish D. Shah (EVP and CFO), and Aldo Martinez (Director of Finance). The company reported a significant 5.6% year-over-year increase in Same-Property RevPAR, reaching $206.54, primarily fueled by a 5.7% rise in the Average Daily Rate (ADR) to $285.71, while occupancy remained steady at 72.3%.
Adjusted EBITDAre for the quarter stood at a healthy $78.1 million, surpassing management's expectations by approximately $1 million. Adjusted FFO Per Share saw a 7% increase to $0.61, attributed to positive operating results and a reduced share count following previous buybacks. Despite a GAAP net loss of $19.3 million due to a non-cash impairment charge from the sale of the Kimpton RiverPlace Hotel, the company's operational performance remained strong.
Marcel Verbaas highlighted that transient demand was a primary driver of RevPAR growth, increasing by 6.9% year-over-year, outperforming the group segment (3.4% growth). This was notably influenced by specific event dynamics, such as the FIFA World Cup, which created unique demand patterns in several markets. While the World Cup led to some groups deferring bookings in affected markets, transient business compensated, though sometimes at the expense of non-room spend. Key markets like Philadelphia (22% RevPAR growth), Salt Lake City (13.1%), Phoenix (12.7%), and Birmingham (12.2%) demonstrated exceptional performance.
Barry Bloom provided insights into operational expenses, noting a 4.2% increase in total same-property hotel operating expenses, slightly outpacing revenue growth and leading to a 65 basis point margin decline. This was largely due to the absence of a $1.5 million real estate tax refund received in Q2 2025 and increased expenses during the initial phase of food and beverage repositioning at W Nashville. Energy expenses rose by nearly 11% due to higher gas and water costs, partially offset by electricity efficiencies. The company invested $15.4 million in portfolio improvements during the quarter, with significant renovations planned for Andaz Napa and The Ritz-Carlton Denver in Q4.
A notable strategic move was the sale of the 85-room Kimpton RiverPlace Hotel in Portland, Oregon, for $11 million. This disposition was described as a response to the hotel's underperformance due to market challenges and increased competition. The company maintains its presence in Portland with the Hyatt Regency Portland. Furthermore, Xenia is in the process of renaming four Autograph Collection hotels and has transitioned their management to Davidson Hotel Group, aiming to enhance local market alignment and long-term value.
CFO Atish Shah updated the full-year 2026 guidance, raising adjusted EBITDAre to $273 million at the midpoint, a $7 million increase. RevPAR growth guidance was also increased by 150 basis points to 5.5% at the midpoint. Shah emphasized the strong group room revenue pace for the second half of 2026, up 12% by the end of June, with 80% of this increase driven by demand volume. Transient booking pace for August and September also tracked in the high-single-digit percentage range. The company's total debt stood at $1.4 billion, with a robust liquidity position of $612 million. Capital expenditures remain on track, with full-year guidance at $70 million to $80 million.
Looking ahead, Xenia Hotels & Resorts expressed confidence in its improved outlook, driven by favorable market conditions, a low-supply-growth environment, and strong demand indicators across its high-quality portfolio. The company continues to evaluate external growth opportunities and maintain a flexible balance sheet to support its capital allocation decisions, balancing reinvestment in existing assets, share repurchases, and strategic acquisitions.
This earnings call underscores Xenia's resilience and forward-thinking approach in the dynamic hospitality sector. The company's ability to adapt to changing market conditions, divest underperforming assets, and strategically invest in its high-quality portfolio positions it well for continued success. The emphasis on strengthening both transient and group demand, coupled with prudent financial management, suggests a sustainable growth trajectory for Xenia Hotels & Resorts. For investors, this report offers a reassuring picture of a company navigating challenges effectively while capitalizing on opportunities for enhanced shareholder value.