Pebblebrook Hotel Trust (NYSE:PEB) reported fourth-quarter 2025 results that management said came in ahead of expectations despite travel disruptions tied to a government shutdown. On the company’s earnings call held Feb. 26, 2026, executives pointed to accelerating demand trends in several key markets, continued strength in out-of-room spending, and disciplined expense management as the main drivers supporting their outlook for 2026.
Fourth-quarter results topped expectations amid disruptions
Co-President and CFO Raymond Martz said Pebblebrook ended 2025 with “stronger than expected” fourth-quarter growth even as the government shutdown weighed on demand. Same-property total RevPAR increased 2.9%, while same-property hotel EBITDA rose 3.9% to $64.6 million, which Martz said was $2.2 million above the midpoint of the company’s outlook.
Operationally, same-property occupancy increased 190 basis points in the quarter, while ADR declined 1.6%, resulting in a 1.2% increase in RevPAR. Management highlighted out-of-room performance as a key contributor: non-room RevPAR increased 5.5%, driving the 2.9% gain in total RevPAR. Martz described a deliberate revenue management approach focused on occupancy where it produces stronger incremental profitability, particularly at resort properties that benefit from higher food and beverage and ancillary spending.
Resorts and San Francisco led, while other markets faced headwinds
Martz said 2025 featured “two very different storylines,” with redeveloped resorts and urban recovery markets—especially San Francisco—driving growth, while Los Angeles and Washington, D.C. weighed on results due to “unexpected events.”
Within the resort portfolio, fourth-quarter occupancy increased by roughly 160 basis points, total RevPAR rose 4.9%, and same-property resort EBITDA jumped 17.4%. Martz said results reflected benefits from Pebblebrook’s multi-year strategic reinvestment program and that several redeveloped properties are still ramping toward stabilization.
Management singled out Newport Harbor Island Resort as a standout in its first full year post-redevelopment, with total RevPAR up 38.5% and EBITDA increasing by $9.3 million to $17.7 million, with “additional upside” expected in 2026 as it stabilizes.
San Francisco again led the portfolio. Martz said fourth-quarter total RevPAR in the market increased more than 32%, driven by recovery across business transient, group, convention, and leisure demand. Chairman and CEO Jon Bortz later said San Francisco RevPAR increased 37.9% in the quarter and emphasized that the recovery was not solely convention-driven, noting that in December—when he said there were “zero conventions”—Pebblebrook’s San Francisco portfolio still delivered 16.2% RevPAR growth.
Elsewhere, the company cited steady improvements in markets such as Portland and Chicago, while market-specific disruptions—including fires, ICE raids, National Guard deployments, government shutdowns, and softer convention calendars—affected San Diego, Washington, D.C., and Los Angeles. Management said Los Angeles improved sequentially through 2025, with RevPAR turning positive in the fourth quarter and early 2026 trends improving further.
Cost controls, corporate streamlining, and LaPlaya update
Pebblebrook said expense growth remained contained. Martz reported full-year same-property expenses rose 3%, and excluding real estate tax and other credits from the prior year, total expense growth was 2.2%, with cost per occupied room “basically flat.” Energy costs increased roughly 2% for the year, reflecting property-level initiatives and productivity programs.
At the corporate level, Martz said Pebblebrook reduced corporate staffing levels by about 10% year over year through process improvements, automation, and productivity initiatives. The company expects total run-rate corporate cash G&A to decline modestly in 2026.
Management also provided an update on LaPlaya Beach Resort & Club in Naples, Florida. Martz said weather resiliency improvements are complete and the property is fully restored following Hurricanes Helene and Milton. Pebblebrook finalized insurance settlements before year-end and recorded $3.1 million in business interruption proceeds in the fourth quarter, bringing total 2025 business interruption proceeds to $12.7 million. With claims settled, the company does not expect additional business interruption income in 2026 and forecast LaPlaya hotel EBITDA of $28 million to $30 million in 2026 as it continues recovering from disruptions.
Capital allocation: lower CapEx run rate, asset sales, buybacks, and refinancing
Martz said Pebblebrook invested $74.6 million of capital in 2025, including resiliency work at LaPlaya, refreshes at Argonaut and Hyatt Centric Delfina, a guest room refresh at Revere Hotel Boston Common, a renovation of meeting space at Paradise Point Resort, and sustainability investments. For 2026, the company expects capital investments of $65 million to $75 million, reflecting a return to a more “normalized” level now that major redevelopment work is largely complete. Management described the lower capital run rate as a tailwind that could support higher discretionary free cash flow for debt paydowns and repurchases.
The company completed two dispositions in the fourth quarter for gross proceeds of over $116 million, selling the Montrose at Beverly Hills and The Westin Michigan Avenue Chicago, and used the proceeds for debt reduction and repurchasing common and preferred shares. In 2025, Pebblebrook repurchased $13.3 million of preferred shares at a 24% discount to par and repurchased approximately $6.3 million of common shares at an average price of $11.37, for a total of $71.3 million.
On the balance sheet, Martz said the company refinanced near-term maturities by closing a new $450 million senior unsecured term loan due in 2031 and repaid the remaining Margaritaville Hollywood Beach Resort loan using cash on hand. He said the actions extended maturities, increased the unencumbered asset base, and provided a “fully funded path” to address $350 million of convertible notes due December 2026. Pebblebrook reported $150 million of cash on hand and roughly $640 million of revolving capacity, with no significant maturities until 2028 aside from the convertibles. Management said its weighted average interest cost of 4.1% is the lowest in the hotel lodging REIT sector.
Early 2026 trends and outlook: strong start, conservative full-year guidance
Bortz said he believes Pebblebrook may be reaching a “favorable transition point,” pointing to improved travel trends after the shutdown ended and to major event catalysts. He cited strong performance from the Super Bowl in San Francisco and NBA All-Star Week in Los Angeles, and he highlighted a favorable 2026 holiday calendar with many holidays falling on or adjacent to weekends.
For early 2026, Bortz said January RevPAR increased 4.6% and would have been “almost 7%” but for Winter Storm Fern, which disrupted travel late in the month. He said February was on pace for RevPAR growth of 15%+, though another winter storm (Hernando) was expected to depress full-month industry numbers. Pebblebrook’s first-quarter outlook calls for RevPAR growth of 7.5% to 9% and total RevPAR growth of 6% to 7.5%.
For the full year, management struck a more cautious tone, citing policy and geopolitical risks and noting that 2025 surprises influenced its conservatism. Pebblebrook forecast 2026 RevPAR growth of 2% to 4% and total RevPAR growth of 2.25% to 4.25%. The company expects same-property EBITDA growth of 2.1% to 6%, with a midpoint of 4%.
In response to a question about group visibility, Bortz said most of the company’s pace advantage was in transient demand, while group room nights were down 0.6% for the year, with group ADR up 2.4% and group revenue up 1.8%. Transient room nights were up 11.6%, transient ADR up 0.6%, and transient revenue up 12.2%. He said the company continued to see softness in government and government-related segments.
About Pebblebrook Hotel Trust (NYSE:PEB)
Pebblebrook Hotel Trust (NYSE:PEB) is a real estate investment trust specializing in premium, high-barrier-to-entry hotel properties in gateway markets across the United States. Established in 2009, PEB focuses on lifestyle-oriented lodging assets that cater to business and leisure travelers seeking elevated experiences. The company’s investment strategy emphasizes select-service and full-service hotels with established brands and prime urban or resort locations.
PEB’s portfolio comprises more than 30 properties in major metropolitan areas including New York City, Los Angeles, Chicago, Miami and San Francisco.
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