For context, Maui contributed $111,000,000 of EBITDA for the year, which was slightly ahead of our most recent forecast and significantly ahead of our initial $90,000,000 expectation at the start of 2025. Looking forward, we expect Maui to contribute approximately $120,000,000 of EBITDA in 2026. Turning to business transient, revenue was up 1% in the fourth quarter as increases in rate offset a decline in room nights. Group revenue for the quarter was up approximately 1% year over year, as rate increases offset group room night declines which were driven by renovations and citywide softness in several markets. Our properties sold 900,000 group rooms in the fourth quarter, bringing our total group room nights sold for 2025 to 4,100,000.
Ancillary spending remained strong in the quarter, with continued growth in food and beverage revenues and out-of-room spending. Comparable hotel F&B revenue grew 6%, driven by strong outlet performance and banquet contribution per group room night. We also saw particularly strong growth in other revenue which was up 10% in the quarter, including growth in golf and spa. Taken together, we continue to benefit from the strength of the affluent consumer across properties in our portfolio. Turning to capital allocation, in 2025, we sold The Westin Cincinnati and Washington Marriott at Metro Center for a combined $237,000,000. We also provided $114,000,000 of seller financing for the Washington Marriott at Metro Center transaction at a 6.5% interest rate.
Yesterday, we announced the sale of the Four Seasons Resort Orlando at Walt Disney World Resort and the Four Seasons Resort and Residences Jackson Hole for $1,100,000,000, which represents a 14.9x EBITDA multiple on trailing twelve-month EBITDA. The multiple includes approximately $88,000,000 of estimated foregone capital expenditures over the next five years. We purchased the hotels in 2021 and 2022, respectively, for a total of $925,000,000 with no significant capital expenditures required under our ownership. The $1,100,000,000 sale price represents an 11% unlevered IRR and an EBITDA multiple that is more than four turns higher than our company’s recent trading multiple. The IRR includes $58,000,000 of capital expenditures which was funded within the FF&E reserve, as well as transaction costs.
These items negatively impacted the IRR calculation by approximately 170 basis points. We are retaining the ongoing condo development at the Four Seasons Orlando, which is excluded from the sale. In 2025, we recognized $17,000,000 of net adjusted EBITDAre from the sale of 16 condo units, and we expect to recognize an additional $20,000,000 to $25,000,000 when the remaining units are sold. As we assess the best use of capital in the current environment, our investment-grade balance sheet provides meaningful financial flexibility to pursue the highest return opportunities. We expect to recognize a taxable gain of approximately $500,000,000 from the sale of the two hotels, subject to final proration, and we have 45 days to identify a potential like-kind exchange.
If we are unable to identify an accretive acquisition within that time frame, we would intend to return the taxable gain to shareholders through a special dividend. For the remaining sale proceeds, we will evaluate the best path forward based on market conditions, which could include returning additional capital to shareholders through special dividends or share repurchases, reinvesting in our portfolio, or pursuing accretive acquisitions. We also completed the previously announced sale of The St. Regis Houston for $51,000,000. The sale price represents a 25x EBITDA multiple on trailing twelve-month EBITDA. The multiple includes approximately $49,000,000 of estimated foregone capital expenditures over the next five years.
Finally, the Sheraton Parsippany is under contract to sell for $15,000,000 with an expected close in the second quarter. Since 2018, we have disposed of approximately $6,400,000,000 of hotel assets at a blended 16.7x EBITDA multiple, including estimated foregone capital expenditures of $1,200,000,000. This compares favorably to the $4,900,000,000 of acquisitions we completed over the same period at a blended 13.6x EBITDA multiple. In addition to successfully allocating capital through dispositions, we also returned capital to shareholders through share repurchases and dividends. In 2025, we repurchased 13,100,000 shares at an average price of $15.68 per share for a total of $205,000,000.
For context, we have repurchased 69,200,000 shares at an average price of $16.63 per share, for a total of approximately $1,200,000,000 since 2017. In the fourth quarter, we declared a quarterly common dividend of $0.20 per share and announced a special dividend of $0.15 per share, bringing the total dividends declared for the year to $0.95 per share. In total, we returned nearly $860,000,000 of capital to shareholders in 2025, including share repurchases. Turning to portfolio reinvestment, in 2025, we invested approximately $144,000,000 in capital expenditures, resiliency initiatives, and hurricane restoration across our portfolio. As of the end of the fourth quarter, the Hyatt transformational capital program is more than 75% complete and is tracking on time and under budget.
Transformational renovations have been completed at the Grand Hyatt Atlanta Buckhead, the Hyatt Regency Capitol Hill, and the Hyatt Regency Austin. We are nearing completion of the Hyatt Regency Reston and Grand Hyatt Washington, D.C., both of which are expected to be finished in the first half of 2026. The Manchester Grand Hyatt San Diego, the final asset in the program, has been phased to mitigate business interruption and is expected to be substantially complete by 2026. Additionally, we started the transformational renovation of the New Orleans Marriott in 2025, which is part of the second Marriott transformational capital program.
In the fourth quarter, we received $3,000,000 of operating guarantees related to our transformational capital programs, bringing the total received to $26,000,000 in 2025. We also completed several major ROI projects over the course of 2025, including the oceanfront ballroom expansion at The Don CeSar, villa development at The Venetian Canyon Suites, the new AVIV restaurant at the 1 Hotel South Beach, and the meeting space expansion and reopening of The View restaurant at the New York Marriott Marquis. We are nearing completion of the condo development at the Four Seasons Orlando, having completed the 31-unit mid-rise building, and we began closing on unit sales in the fourth quarter.
To date, we have deposits and purchase agreements in place for 28 of the 40 units, including eight of the nine villas, which are expected to complete in the first half of this year. In 2026, our capital expenditure guidance range is $525,000,000 to $625,000,000. This includes approximately $250,000,000 to $300,000,000 of investment focused on redevelopment, repositioning, and ROI projects. As I just mentioned, we expect to substantially complete the Hyatt transformational capital program renovations by 2026. The second Marriott transformational capital program is also well underway. We expect to start construction at The Ritz-Carlton Naples, Tiburón and The Westin Kierland in the second quarter.
As a reminder, we expect to benefit from approximately $19,000,000 of operating profit guarantees in 2026 related to our transformational capital programs, which we expect will offset the majority of the EBITDA disruption at these properties. In addition to our capital expenditure investment, we expect to spend $15,000,000 to complete the condo development at the Four Seasons Orlando in 2026. Looking back on our portfolio reinvestments, we completed 23 transformational renovations between 2018 and 2023, which continue to provide meaningful tailwinds for our portfolio. Of the 21 hotels that have stabilized post-renovation operations to date, the average RevPAR Index share gain is 8.7 points, which is well in excess of our targeted gain of three to five points.
As evidenced by our results, the continued reinvestments we have made in our portfolio yield strong returns and drive value creation for our shareholders. We continue to be recognized as a global leader in corporate responsibility over the course of 2025. As part of our climate risk and resiliency program, we completed the purchase and pre-installation of modular flood barriers that exceed FEMA 100-year flood elevation for eight high-risk properties. We are also working to formalize the connection between our climate risk program and our property insurance premiums to validate proactive resilience investment opportunities, quantify the impact and return on investment, and scale efforts across our portfolio where we see elevated climate risk.
Wrapping up, we are very proud of the continued outperformance we delivered in 2025, which reflects the disciplined capital allocation decisions we have made since 2017. Our recent transactions represent an important step in advancing our capital allocation strategy and underscore our ability to generate meaningful shareholder value by monetizing assets at attractive returns and accretive multiples with an eye towards maximizing total shareholder returns. Looking ahead, we are optimistic about the travel environment, particularly at the upper end of the chain scale, and we are confident that Host is well positioned to capitalize on future opportunities.
With our geographically diversified portfolio, ongoing reinvestment in our properties, and fortress balance sheet, we will continue to leverage our competitive advantages to create value for our shareholders in 2026 and beyond. With that, I will now turn the call over to Sourav Ghosh. Thank you, Jim, and good morning, everyone. Building on Jim’s comments, I will go into detail on our fourth quarter operations, full-year 2026 guidance, and our balance sheet. Starting with total revenue trends, total RevPAR growth continued to outpace RevPAR growth as transient guests maintained elevated levels of out-of-room spending.
Sourav Ghosh: Comparable hotel food and beverage revenue for the quarter grew approximately 6% driven by outlet revenue and banquet contribution per group room night. Outlet revenue grew 9% driven by resorts, and new restaurants at the 1 Hotel South Beach and the New York Marriott Marquis. Resort outlet growth was led by the ongoing recovery in Maui, as well as the Wisconsin Naples and the continued ramp-up of the single-island oceanfront resort, and the Wisconsin Turtle Bay. Comparable banquet and catering revenue increased 4% in the fourth quarter, driven by 6% growth in banquet contribution per group room night. Other revenues increased 10%, propelled by sustained strength in golf and spa operations.
Spa revenue was up 6% driven by higher occupancy at luxury resorts and improved capture, particularly at the Wisconsin Amelia Island and Zama Tialani. Golf revenue grew 14% due to strong performance at our Maui and Naples golf courses. Shifting to rooms revenues, overall transient revenue grew 6% compared to 2024, driven by improving leisure transient demand and rate growth across the portfolio. Notably, resorts generated 80% of the transient revenue growth in the quarter. Transient revenue at luxury properties increased by more than 10%, underscoring the strength of high-end demand.
The Ritz-Carlton Naples and Fairmont Killarney delivered double-digit room night growth while maintaining rates above $1,000, representing a 5% increase year over year, further validating the meaningful impact of our transformational reinvestment strategy. Looking at holidays in the fourth quarter, Thanksgiving revenue grew 3% while festive season revenue grew 9%. Festive season revenue growth, which includes the two-week period around Christmas and New Year’s, was broad-based across the portfolio but led by resorts, with four resorts generating more than $1,000,000 of incremental revenue over the festive period. Looking at recent and upcoming 2026 holidays, transient booking pace is up meaningfully.
For Presidents’ Day weekend, transient revenue pace was up approximately 8% compared to the same time last year, driven by rate and occupancy growth at our convention properties. For the spring break and Easter period, which runs from March through April, transient revenue pace is up 17%. Strength is broad-based across property type and led by hotels in Maui, Orlando, and New York. Business transient revenue grew approximately 1% versus 2024, driven primarily by rate growth as our managers continued shifting toward corporate negotiated business. Group revenue in the fourth quarter was up 1% year over year, as 3% rate growth outpaced group room night declines.
Corporate groups led growth in the quarter, particularly at our properties in New York, Boston, San Diego, and San Francisco. For 2026, we have 3,100,000 definite group room nights on the books, representing a 16% increase since 2025 and putting us slightly ahead of where we were this time last year. Total group revenue pace is up 5% over the same time last year, driven by rate and banquet growth. More specifically, we are seeing meaningful total group revenue pace in San Francisco, Washington, D.C., Nashville, Miami, New York, Austin, and Atlanta. Group booking pace is strongest for the second and fourth quarters, driven by World Cup bookings and a beneficial holiday calendar shift in October.
We are encouraged by citywide room night pace in key markets such as San Antonio, San Francisco, and Washington, D.C. Shifting gears to margins, full-year 2025 comparable hotel EBITDA margin of 28.9% was 40 basis points below 2024, by the $21,000,000 of business interruption proceeds that we received for the Maui wildfires as well as certain one-time benefits in 2024. Turning to our outlook for 2026, the midpoint of our guidance contemplates a stable operating environment with a continuation of trends seen through 2025. This includes leisure transient strength driven by special events such as the World Cup, modest improvements to short-term group booking trends, and stable business transient demand.
At the low end of our guidance range, we have assumed no improvement in short-term group booking trends and weaker special events demand, and at the high end, we have assumed improving short-term group booking trends and increased demand around special events. For full-year 2026, we anticipate comparable hotel total RevPAR growth of between 2.5% and 4% and comparable hotel RevPAR growth of between 2% and 3.5% over 2025. Year over year, we expect comparable hotel EBITDA margins to be down 20 basis points at the low end of our guidance to up 20 basis points at the high end.
In 2026, our 74-hotel comparable portfolio now includes the Alila Ventana Big Sur but excludes The Don CeSar due to its closure in 2025. Our 2026 comparable portfolio also removed the Four Seasons Resort Orlando at Walt Disney World Resort, the Four Seasons Resort and Residences Jackson Hole, and Sheraton Parsippany, which is under contract and expected to be sold in the second quarter. In terms of comparable hotel RevPAR growth cadence for the year, we expect the first quarter to be the weakest with growth in the low single digits due to tough comparisons related to the presidential inauguration and pickup from the Los Angeles wildfires last year.
January 2026 performance exceeded expectations, with comparable hotel RevPAR declining only 40 basis points despite challenging comparisons to January 2025. We expect the second quarter to be the strongest of the year, with mid-single-digit RevPAR growth driven by the World Cup and an earlier Easter. RevPAR growth in the second half of the year is expected to be between first and second quarter growth. At the midpoint of our guidance range, we anticipate comparable hotel RevPAR growth of 2.75% compared to 2025.
This includes an estimated 40 basis point net benefit from special events for the full year, with an estimated 60 basis point lift from the World Cup partially offset by a 20 basis point headwind from last year’s presidential inauguration. In addition, Maui is expected to contribute approximately 35 basis points to our full-year RevPAR growth. At the midpoint, we expect a comparable hotel EBITDA margin of 29.2%, which is flat to 2025. Our margin performance reflects our continued success in partnering with our operators to drive productivity gains across our portfolio as well as the value-enhancing capital allocation decisions we have made over the past few years. In 2026, we expect wage rates to increase approximately 5%.
For context, in 2025, wages grew at slightly over 6%. As a reminder, wages and benefits comprise approximately 50% of our total comparable hotel operating expenses. Our 2026 full-year adjusted EBITDAre midpoint is $1,770,000,000. On a year-over-year basis, this reflects an expected 1% increase despite a decline of $87,000,000 from dispositions, a $17,000,000 net decline in business interruption proceeds, and a $7,000,000 net decline in transformational renovation program operating profit guarantees. Our adjusted EBITDAre midpoint includes $28,000,000 of estimated EBITDA from operations at The Don CeSar, which is excluded from our comparable hotel set in 2026 as previously mentioned. It also includes approximately $7,000,000 of business interruption proceeds related to Hurricanes Helene and Milton, which we already received in January.
Lastly, our 2026 full-year adjusted EBITDAre midpoint includes between $20,000,000 and $25,000,000 of estimated net EBITDA from the Four Seasons condo development, which we expect to recognize concurrent with condo sale closings. Turning to our balance sheet and liquidity position, our weighted average maturity is 5.1 years at a weighted average interest rate of 4.8%. We have no debt maturities in 2026. We ended 2025 at a leverage ratio of 2.6x, and we have $2,400,000,000 in total available liquidity, including $167,000,000 of FF&E reserves and $1,500,000,000 of availability on our credit facility. Our fortress balance sheet continues to be a distinct competitive advantage for Host.
Wrapping up, in January, we paid a quarterly cash dividend of $0.20 per share and a special dividend of $0.15, bringing the total dividend declared in 2025 to $0.95 per share. On February 17, our board of directors authorized a quarterly cash dividend of $0.20 on our common stock to be paid on April 15 to shareholders of record on March 31. As always, future dividends are subject to approval by the company’s board of directors. To conclude, we are proud of our accomplishments in 2025, and we believe that our diversified portfolio, continued reinvestment in our assets, and strong balance sheet uniquely position Host to capitalize on future opportunities. With that, we would be happy to take your questions.
To ensure we have time to address as many questions as possible, please limit yourself to one question.
Operator: If you would like to ask a question, please press star followed by the number one on your telephone keypad. In the interest of time, we ask that you please limit yourself to one question, and for any additional questions, please rejoin the queue. Our first question comes from Michael Bellisario from Baird. Please go ahead. Your line is open.
James F. Risoleo: Thanks. Good morning, everyone. Jim, on the Four Seasons sales, it is certainly
Michael Bellisario: great execution there, and you are proving out value. So two parts here. One, how deep is that buyer pool today? And then two, can you, and next, maybe would you sell more of your top—sort of what is the outlook and thinking around more high-value dispositions going forward? Thanks.
Operator: Sure, Mike.
Sourav Ghosh: Good questions.
James F. Risoleo: As you always have good questions for us, and we appreciate that very much. Before I talk about the Four Seasons specifically, I just want to take a moment and go back and highlight our performance in 2025 and our guide in 2026. You know, Sourav said it as well. We are very proud of our ’25 performance: TrevPAR, 4.2%; RevPAR, 3.8%; and adjusted EBITDAre of $1,757,000,000. And our ’26 guide, I think, is very strong, with TrevPAR at the midpoint of 3.25%, and RevPAR 2.75%, and adjusted EBITDAre of $1,770,000,000.
I think it is worth noting again, saying again, that $1,770,000,000 is after we sold $87,000,000 of hotel EBITDA and we will not benefit from BI proceeds and operating partner guarantees, disruption guarantees of $24,000,000. So the run rate is really closer to $1,900,000,000 in 2025. And that did not happen by accident. That is a result of all the capital allocation decisions that we have made over the last nine years. And, as you know, we have been exploring ways to unlock the value embedded in our shares—in other words, looking for ways to expand our trading multiple with the goal of maximizing total shareholder returns.
In addition to acquiring $4,900,000,000 of assets at 13.6x, we sold $6,400,000,000 of assets with $1,200,000,000 of weighted CapEx at 16.7x. Shares have not really responded. We have not received credit for portfolio recycling despite buying well below where we were selling on a blended basis. So I think it goes back to a healthy amount of skeptic with regard to some of the large acquisitions that we made, starting with the 1 Hotel South Beach, which in 2018 had $46,000,000 of EBITDA and in 2025 we ended the year with $65,000,000 of EBITDA. So the story is solid, and it holds together very well. But to answer your question, is there a market for these assets?
If so, at what valuation? Are we sellers of, quote, the crown jewels to realize the value that we have created? And the short answer is yes. I mean, you have heard us say that we are testing the market with dispositions and that everything is for sale at the right price, and we mean it. This was an opportunistic transaction to create immediate and tangible value for our shareholders. We are looking for an opportunity to realize that value, and we found one, and we executed on it.
So even though the two Four Seasons were top performers for Host, and we fully expect luxury to continue outperforming, we believe that it was prudent to maximize value for our shareholders by selling these assets at an attractive profit and accretive multiple. Quick summary of the transaction: we sold these two assets for $175,000,000 more than where we bought them; a 14.9x multiple, which is a 5.9% cap rate, that is four turns higher than where Host’s shares have been trading. And we think that provides a really favorable read-through on the value of our portfolio. We generated an 11% unlevered IRR for our ownership period, which clearly demonstrates our ability to create value.
That includes $58,000,000 of CapEx which was funded within the FF&E reserve, as well as transaction costs that hit the IRR by 170 basis points. We kept the condos in Orlando, and we expect the IRR on the condos to be above 11%, with our guide to roughly $40,000,000 of net EBITDA in total. So, and as you said in one of your notes, Mike, we sold 6.5% of enterprise value but only 4.7% of our consolidated hotel EBITDA. So we think this was a really fantastic trade.
You know, the Four Seasons Orlando, based on 2019 year-end EBITDA, saw an 18.4% CAGR from the time we bought it to our ownership period through ’25, so it has performed very well. And we are very, very happy with the roundtrip investment we made with these two resorts. Not only do we feel that the transaction demonstrates the value of our portfolio, it also shows the value that we create for shareholders as a management team, including our unwavering focus on maximizing total shareholder return, which is what we have done here, we believe. So, are there other opportunities to maximize value within the portfolio? I think there are. We will be opportunistic.
The buyer pool for these types of assets is, I think, a lot deeper than people realize. There are a lot of sovereigns out there who are very interested in luxury hotels. There are high-net-worth individuals who are interested in luxury properties as well. And there are a couple of big private equity firms that have a lot of capital that have been sitting on the sidelines waiting for the inflection point to jump back into the market. And we are hopeful that this is the inflection point, that we can prove out that there is value here, value to be created.
And we are certainly hopeful that we are going to get the read-through and see some multiple expansion as a result of not only this decision, but all the capital allocation decisions that we have made over the last nine years.
Sourav Ghosh: Thanks for the color.
Operator: Next question comes from David Brian Katz from Jefferies.
James F. Risoleo: Good morning. Apologize if I missed it in your prepared remarks, but the transformational capital program you included in the release with Marriott. Can you just put a little more color around that
David Brian Katz: and sort of why those hotels, why now, and what we can expect, you know, on the back end of that endeavor? Sure.
James F. Risoleo: You know, why those hotels, David? They are great assets, and they need to be repositioned. And we believe that by investing in these assets in a transformational way, that we are going to meaningfully increase our yield index and realize, you know, mid-teens cash-on-cash returns as a result of our incremental investment that will benefit our shareholders. So the thesis is that we proved this out very strongly in our first Marriott transformational capital program, which was 16 assets, as well as eight additional assets. We underwrote three to five points increase in yield index.
On the stabilized hotels to date, we picked up 8.7 points in yield index, which means other hotels in the market have lost yield index to our properties. And we think that this is a very, very solid use of our capital, and it is a clear read-through to our ability to really invest wisely for the benefit of our shareholders and see the proceeds drop right to the bottom line. And the brands see it as well with Host. I mean, not only is this our second transformational capital program with Marriott—after we did 16 in the first round, we did four in this round—but we are in the midst of finishing up six properties with Hyatt.
So it is great to be able to partner with the brands, and they provide the support that we need to effectuate these transformational renovations while covering off anticipated disruption involved with the renovation and providing enhanced owner priority returns. So we could not be happier with our relationship with the brands and the support that they give us, and the fact that we are investing in these assets which elevates not only the EBITDA profile for Host, but the EBITDA profile for the brand as well. And we benefit from that all the way around. It is a roundtrip investment, if you will.
David Brian Katz: And have you shared with us what the sort of reimbursement for Marriott will be and sort of how that cadence works for our model.
James F. Risoleo: Well, the re—I am sorry. Reimbursement, we talk about the operating profit guarantees. Sure. And Sourav can give you color on what they are and what we got last year, what we will get this year. And the—our anticipated property performance is reflected in our guidance. So that is already there for you.
Sourav Ghosh: Got it. Yeah, just to expand on the guarantee, in 2025 we did receive some operating guarantee from the MTCP2 that was about $2,000,000. It was $1,000,000 in the third quarter, $1,000,000 in the fourth quarter. Remember, we did get $24,000,000 for HTCP, the Hyatt Transformational Capital Program, throughout 2025. In 2026, we will get operating profit guarantee for HTCP. That is about $7,000,000, and that is really for the Hyatt Manchester in San Diego. And the MTCP2, we will get about $12,000,000 through the year. So that is a total of $19,000,000. So in other words, it is about a $7,000,000 delta in terms of what we will get for ’26 versus ’25—so $7,000,000 lower.
David Brian Katz: Very helpful. Thanks.
Operator: Our next question comes from Daniel Brian Politzer from JPMorgan.
Daniel Brian Politzer: I wanted to touch on Maui a bit here. You came into last year forecasting, I think, $90,000,000 of EBITDA, ended at $111,000,000, and now you are forecasting $120,000,000 for 2026. I guess is there some element of conservatism in there as we think about the path of getting back to 2019–2020? And what are the puts and takes of that 2026 outlook?
Sourav Ghosh: Sure. So when you look at—you’re right. We started off last year forecasting $90,000,000 for 2025, and we ended up at $111,000,000, and now we are forecasting in addition
Michael Bellisario: million.
Sourav Ghosh: Based on the current booking pace and how things are shaping up, we feel pretty confident in terms of the $120,000,000 guide. The reality is, as we had talked about earlier, that the Hyatt Regency—that is the one in Ka’anapali—that is one which is going to take a little bit of time to come back because of the lead time required for the groups to come back in a meaningful way. I will say that the Wailea Hotel, the Fairmont Kea Lani, actually reached a high watermark in 2025 with $49,000,000 of EBITDA. And on those as well—on the Wailea as well. So the Wailea side is almost completely recovered, if you will, relative to pre-fire.
The Hyatt Regency has a little ways to go and has made meaningful progress, and we are expecting a significant amount of growth for the Hyatt Regency Maui. I mean, just to put it into perspective, that property we are expecting to go from about $28,000,000 of EBITDA to close to $34,000,000 for 2026. So significant growth there, and we are making considerable progress. At this point in time, we feel comfortable with the $120,000,000. Does that change over the course of the year as we see potential group pace pickup and short-term pickup? Absolutely. So we will provide an update on the next call. So there could be potential upside in those numbers.
Daniel Brian Politzer: Got it. Thanks so much for all the detail.
Operator: Next question comes from Smedes Rose from Citigroup.
Michael Bellisario: Hi. Thank you. I just wanted to ask a little bit about these CapEx programs
James F. Risoleo: that you are doing with the brands kind of finish up over the course of
Michael Bellisario: this year, and it looks like total CapEx spending is kind of on a downward trend.
James F. Risoleo: Is it fair to think that could continue to kind of move down slightly
Michael Bellisario: And does that change the way you are thinking about
James F. Risoleo: and the board are thinking about your quarterly dividend payments versus kind of year-end
Daniel Brian Politzer: true-ups.
James F. Risoleo: Smedes, we are always looking for opportunities to invest in our assets if we can generate an acceptable return on that investment. So we have done a lot of transformational renovations in the portfolio. I think that—I think it is a total of about 33 assets will have been transformationally renovated now, and that excludes the Washington Marriott at Metro Center, which we sold or it would have been 34. That was one of the original 16 programs. So, stay tuned. We will look for other opportunities after we complete these assets going forward.
The portfolio is in terrific shape given the amount of capital that we put in it, and you can see that in the performance that we have been able to generate. So with respect to the dividend, our objective is to pay out our taxable income and to pay a sustainable dividend going forward. So it is something that we will revisit from time to time. And if a policy change is warranted, that is something we will discuss with the board of directors, and we will inform you at that point in time. But at this point in time, we are on track for our $0.20 dividend that is paid this quarter coming up.
And stay tuned for the next dividend announcement.
Smedes Rose: Thank you.
Operator: Our next question comes from Aryeh Klein from BMO Capital Markets. Please go ahead. Your line is open.
Michael Bellisario: Jim, you talked a bit about selling the Four Seasons and your general view on realized value within the portfolio. I was hoping maybe you can talk a little bit about the other side of that and what you are seeing out there on the acquisition side, particularly with the $500,000,000 of capital gains that
Daniel Brian Politzer: could theoretically go towards acquisition?
Smedes Rose: Thanks.
James F. Risoleo: Sure, Aryeh. You know, I would say that the acquisition market generally is better than it was last year, but it is still not robust. And to effectuate a reverse like-kind exchange—you know, we do have an opportunity to effect if we were in a position to identify accretive asset acquisitions within 45 days. And I want to make that point very clear. If we do a reverse like-kind exchange, it is going to be an accretive transaction. We are not going to acquire an asset just to effectuate a like-kind exchange. I think the proof is in the pudding, and I have talked about it earlier today and talked about it in the past.
So we are going to look at what is out there relative to our current trading multiple. And, generally, most of the deals that we have done have been based on relationships that we have in the industry. So we are thinking about it as a team. The investments team and others here at Host are thinking about what assets might be available to us to effectuate this. But we are perfectly comfortable returning a half billion dollars in the form of a special dividend to our shareholders. I mean, that is tangible. It is $0.72 a share, roughly. It is meaningful, and it is a piece of total shareholder return. So I would say stay tuned.
But at this point in time, I think it is more likely than not that we will pay the special dividend.
Smedes Rose: Thanks.
Operator: Our next question comes from Cooper Clark from Wells Fargo. Please go ahead. Your line is open.
Michael Bellisario: Great. Thanks for taking the question. As we think about the $600,000,000 in proceeds outside of the taxable gains, you noted a few options that as it relates to allocation
Daniel Brian Politzer: in terms of
Chris Darling: returning capital through a dividend, buybacks, reinvesting in the portfolio, and potentially acquisitions. As you sit here today, can you talk about which one of those options looks most attractive and where you are seeing the best opportunity?
James F. Risoleo: You know, Cooper, this is going to evolve. It is not something that we have to—we do not have to act on the balance of the proceeds in any short-term time frame. So we are going to sit back and take measure of how the market evolves, how our operating performance evolves over the course of the year, what happens in the acquisition market, and at the appropriate point in time, we will make some decisions with respect to what we do with the incremental cash that is left over. But I cannot sit here today and tell you what the highest and best use of that cash is.
It is something that we are going to take a measured approach to, as we always do, and we will just have to wait and see how the year plays out.
Smedes Rose: Thank you.
Operator: Our next question comes from Chris Darling from Green Street. Please go ahead. Your line is open.
Chris Darling: Jim or Sourav, I would like to dive a little bit
Michael Bellisario: on the expense outlook for the year. I think you mentioned wage and benefit expected to grow about 5%. Anything you can share on labor availability, whether you are seeing sort of an easing in the market? And then if you are able, it would be helpful to break down some of your other expenses
Chris Darling: other major line items where you have visibility?
Sourav Ghosh: Sure thing, Chris. So, obviously, at the midpoint, we are expecting flat margins—or it is expense growth. It is total expense growth that assumed at 3.3%, total revenue growth of 3.3%. Yes, the wage rates are expected to go up 5% for the year. But, obviously, we do have certain other benefits
James F. Risoleo: that are
Sourav Ghosh: overall expenses can be lower for the year. That is being driven by a few things. It is productivity enhancements. There is a lot of focus on really honing in on what the best labor standards should be, and we literally are going position by position and working with our managers to make sure that there is keen focus on the ideal standard that drives scheduling and forecasting for labor. So that is a big piece of it. The other thing is insurance should be down for the year. Obviously, we did not have any weather-related events in 2025, so hoping for a good outcome for our insurance renewal. So that stuff should help our overall expense growth as well.
In terms of labor availability, we have not seen any challenges and, honestly, did not see any challenges at all even coming out
James F. Risoleo: off COVID.
Sourav Ghosh: That is primarily because, as we have stated earlier, we are really predisposed to brand-managed hotels, which really do a great job with talent acquisition and talent retention. So from that perspective, we have not really had any issues being able to staff at the hotel level.
Michael Bellisario: Got it. Appreciate it.
Operator: Our next question comes from Duane Thomas Pfennigwerth from Evercore ISI. Please go ahead. Your line is open.
Daniel Brian Politzer: Just headwinds and tailwinds from a markets perspective. You have talked pretty consistently about Maui tracking better, maybe San Francisco. Maybe you could just comment on group pacing in Maui and, for those two markets, what you expect the level of improvement to be? And then I guess away from those two markets, any markets you would highlight in your portfolio that you think are going to be a material driver this year?
James F. Risoleo: I will let Sourav get into the pacing on Maui and some of the other markets, Duane. But one thing that we are excited about for the year that should be a benefit for our portfolio is the World Cup matches. So World Cup, we expect 60 basis points of full-year RevPAR benefit from the World Cup. That is a net 40 basis point pickup if you take into consideration that 2025 benefited from the inauguration to the tune of 20 basis points. So we have—given the geographic diversification of our portfolio, we have World Cup matches in 10 of our markets, which is, I think, really quite attractive for us going forward.
So we would expect a benefit in quarter two as there are more matches in more markets in quarter two than in quarter three. At this point in time, we do not have a good handle on how things are going to evolve, because we believe that the booking pace is going to be 30 to 60 days out, and we will have a much better indication in our May earnings call how World Cup is going to affect our performance for the year. So that is a big plus for us.
I will let Sourav talk about pace in Maui and maybe pace in San Francisco as well because those are two other really strong markets for us in 2026.
Michael Bellisario: Yeah. Overall, just, as a reminder,
Sourav Ghosh: the group makes up about only 22% in Maui. So the big push is really getting that group—it is the Hyatt Regency—and our RevPAR expectations right now for the Hyatt Regency is north of 10%. It is close to 11.5%, and we are pleased with how that is pacing. Overall, Maui pace is relatively flat to last year, but that is just given how well Wailea performed and where pace was last year for the two hotels in Wailea. But Hyatt Regency, where the group matters meaningfully, we are pacing really strong.
In terms of other markets where we are pacing really well—and this is specifically for the Host portfolio—we did mention Nashville, Atlanta, Miami, San Francisco, D.C., and Austin, which is benefiting just from the reno at the Hyatt Regency. Nashville, we are expecting to pace up 13%. Atlanta, we are pacing up right now close to 10%. Miami is double digits, close to 15%. San Francisco is almost at a pacing of 20%. This is all total group revenue. D.C. is double digits as well at 10%, and Austin is at 26%.
And the ones which are pacing behind are where there is a citywide impact—so specifically, San Diego, which you all know about, to some extent Chicago, Boston, and Seattle.
Smedes Rose: Thank you, guys.
Operator: Next question comes from Robin Margaret Farley from UBS. Please go ahead. Your line is open. Great. Thanks. Most of my questions have been asked already. But just circling back to what you are looking to do with the proceeds from the Four Seasons sale. I know you mentioned you are maybe even leaning towards the dividend, but I am just wondering if you could talk a little bit about what type of assets you are looking at to use those proceeds for.
James F. Risoleo: Robin, it is a broad question. So let me answer it in the context of the types of assets that we feel that we can create value with, and
Sourav Ghosh: also
James F. Risoleo: think about, as we are deploying capital, maintaining our geographic diversification, which has served us very well over the course of the last nine years or so. So it is an asset that we believe will have meaningful upside opportunities from our asset management platform and our enterprise analytics platform. It will have diverse demand generators—a combination of group, leisure transient, and business transient—and in a market that we feel has strong growth drivers going forward. So I cannot get more specific than that because I do not have a specific asset in mind today. But those are the types of properties that we would be looking to acquire.
Smedes Rose: Okay.
Operator: Thanks very much. And we are out of time for questions. I would like to turn the call back over to James F. Risoleo.
James F. Risoleo: Well, thank you again for joining us today. We always appreciate the opportunity to discuss quarterly results with you and, in this case, our full-year 2025 results. And we look forward to seeing many of you at conferences in the coming weeks. Have a great day, and thanks again.
Operator: This concludes today’s conference call. Thank you for your participation. You may now disconnect.
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Host Hotels HST Q4 2025 Earnings Call Transcript was originally published by The Motley Fool
