Chatham Lodging Trust Q2 Earnings Call Highlights

Chatham Lodging Trust raised its 2026 outlook after second-quarter results exceeded expectations, including $35.7 million in hotel EBITDA, $32.7 million in adjusted EBITDA and adjusted FFO of $0.48 per share. Full-year adjusted EBITDA is now projected at $99.2 million to $102.3 million, with RevPAR growth of 1.5% to 3%. Operating momentum strengthened significantly: comparable RevPAR rose 3.3% in the second quarter, accelerating to 8.7% in June and 9.7% in July. Silicon Valley and the recently acquired six-hotel Midwest portfolio were major contributors, while hotel EBITDA margin expanded 220 basis points year over year. Chatham began construction on a 130-suite Home2 Suites hotel in Portland, Maine, and has repurchased more than $18 million of stock since May 2025. The company paused further buybacks as its share price recovered and plans to use potential hotel-sale proceeds to reduce its revolving credit facility balance.

Chatham Lodging Trust NYSE: CLDT raised its full-year outlook after reporting second-quarter results that exceeded its expectations, supported by RevPAR growth, margin expansion, contributions from a recently acquired Midwest portfolio and continued strength in Silicon Valley. Chairman, President and Chief Executive Officer Jeff Fisher said the company has increased its guidance by approximately 20% since the start of 2026, citing “a great acquisition together with strong operating results and share repurchases.” He said Chatham believes the lodging industry is entering the early stages of a prolonged upcycle, although the company remains cautious about near-term uncertainty related to the Iran conflict.

For the second quarter, Chatham reported hotel EBITDA of $35.7 million, adjusted EBITDA of $32.7 million and adjusted funds from operations of $0.48 per share, according to Senior Vice President and Chief Financial Officer Jeremy Wegner. Comparable RevPAR increased 3.3% from the prior year, exceeding the company’s expectations entering the quarter.

Chatham’s RevPAR growth accelerated during the quarter, rising 8.7% in June and 9.7% in July. Executive Vice President and Chief Operating Officer Dennis Craven said July RevPAR increased at 35 of the company’s 39 hotels, while 14 properties posted gains of more than 10%. July occupancy rose 5% and average daily rate increased 4%, Craven said. June and July RevPAR of $175 and $169, respectively, represented all-time highs for those months, according to the company.

Silicon Valley remained a major contributor. The market accounts for approximately 17% of Chatham’s EBITDA, Fisher said, and posted 7% RevPAR growth during the second quarter. July RevPAR across Chatham’s four Silicon Valley hotels increased 26%, including a 41% increase at its two Sunnyvale hotels. Fisher attributed demand in the region primarily to corporate transient travel and cited double-digit demand growth from accounts including Applied Materials, Palo Alto Networks, NVIDIA and Google. He also pointed to recent office leasing announcements by Databricks, Amazon and OpenAI near the company’s Sunnyvale and Mountain View hotels. Chatham said its second-quarter Silicon Valley average daily rate increased 10% to $212, while quarterly RevPAR reached $164, its highest level in six years. Fisher said the company expects additional upside at its Sunnyvale and Mountain View hotels as performance moves closer to 2019 levels.

The six-hotel portfolio in Missouri, Illinois and Kentucky acquired in March produced $3.2 million of hotel EBITDA in the second quarter. The portfolio posted RevPAR growth of 8.6%, while Fisher said its...