サミット・ホテル・プロパティーズ (INN) 2026年第3四半期決算説明会：RevPARは7.2%上昇、業績予想を上方修正

主要なポイント

• 2026年第3四半期のプロフォーマRevPAR（客室平均売上高）は前年同期比7.2%増加し、平均客室単価（ADR）の5.3%上昇と客室稼働率の1.8%上昇が牽引しました。9月のRevPAR伸び率は11%に達しました。
• プロフォーマホテルEBITDAは14.4%増加し、マージンは約200ベーシスポイント拡大、フロースルー（増収分のEBITDA還元率）は60%近くに達しました。調整後EBITDAreは12%増の4,390万ドルとなりました。
• 調整後FFO（事業キャッシュフロー）は前年同期比18%増の2,420万ドル、1株あたり0.20ドルに達しました。
• 都市部市場がポートフォリオの成長を牽引しました。都市部のRevPARは11%以上増加し、ADRは9%超上昇、ホテルEBITDAは26%増加しました。
• サミット・ホテル・プロパティーズは2四半期連続で通期見通しを上方修正しました。経営陣は現在、プロフォーマRevPARの伸び率を3.5%〜4.5%、調整後EBITDAreを1億8,100万〜1億8,600万ドルと予想しています。
• 貸借対照表上の施策により借入コストが低下しました。ローン契約の変更とレバレッジの引き下げにより、年間約240万ドルの支払利息削減が見込まれます。

主要財務データ

事業および営業業績

単価の高い需要セグメントが当四半期を牽引しました。リテールRevPARは約15%増、法人契約RevPARは8.3%増、団体RevPARは14.4%増となりました。都市部市場における法人契約RevPARは17%増加しました。

週半ばの需要が引き続き主な成長ドライバーとなりました。平日のRevPARは8%近く増加し、これには平日のリテールRevPARの14%近い増加や平日の法人契約RevPARの8%超の増加が含まれます。平日の団体RevPARは当四半期の各月で15%超増加しました。

都市部のRevPARは11%以上増加し、ピッツバーグ、ワシントンD.C.、アトランタ、インディアナポリス、ダラス、オクラホマシティ、サンフランシスコ、ニューオーリンズ、サンノゼなどの市場が牽引しました。それぞれ四半期RevPARの伸び率が15%を超えました。

ワールドカップ関連の需要は第3四半期のRevPAR伸び率に推定80〜90ベーシスポイント寄与し、これは第2四半期の影響の約半分に相当します。経営陣は、同イベントが通期のRevPAR伸び率を約60〜70ベーシスポイント押し上げると見積もっています。

プロフォーマRevPARインデックスは116%に達し、パンデミック前のポートフォリオの典型的なピーク水準である113%〜115%を上回りました。NCIポートフォリオのインデックスは125%に達し、サミットの所有下で過去最高水準となり、前年同期比で約6%の市場シェア獲得を示しました。

コスト管理が収益性を支えました。販売客室1室あたりの営業費用は3%強の増加にとどまり、人件費総額は約5.5%増加しました。ポートフォリオ全体では、1物件あたりのフルタイム従業員数が2019年比で約18%少ない状態で運営されています。

サミットは資本リサイクルも継続しました。近く見込まれていた約760万ドルの設備投資回避を考慮した結果、ダラス・アーリントン・サウスの2ホテルを計1,900万ドル（キャップレート5.9%）で売却しました。2023年以降、同社は推定6,800万ドルの設備投資回避分を含め、15のホテルを平均キャップレート4.7%、総額約2億1,900万ドルで売却しています。

経営陣の見通し（ガイダンス）

調整後EBITDAreガイダンスの中央値は500万ドル引き上げられました。1株当たり調整後FFOガイダンスの中央値は、従来予想から0.05ドル（6%超）上昇しました。

10月の速報値プロフォーマRevPARは約5.5%増加し、第4四半期の予約ペースは前年より約5%先行しています。経営陣は、客室単価の上昇がより強固な利益のフロースルーをもたらすため、単価成長が引き続きRevPARの主な牽引役になると見込んでいます。

2027年に向けて、経営陣は出張需要、都市部における週半ばの需要過密、団体需要、および新設ホテルの供給限定から持続的な支えが得られると見込んでいます。また、正式な2027年のガイダンスは公表されていないものの、販売客室1室あたりの営業費用は3%前後の増加率で推移すると予想しています。

リスクおよび注視事項

• 2026年に特別イベントの恩恵を受けた市場では、前年比の比較ハードルがやや高くなる可能性があります。
• 政府関連の出張・旅行は過去のピーク水準を大幅に下回ったままであり、海外からのインバウンド旅行も本格的な回復には至っていません。
• 通期のホテル営業費用における約4%の増加は、変動費と増収の両方を反映しています。経営陣は、販売客室1室あたり約3%の費用増加を、継続的な巡航ペースとして妥当と見なしています。
• 3物件が売却目的保有資産に分類されましたが、経営陣は取引の詳細について議論できるほど手続が進んでいないと述べました。
• 建設コストはパンデミック前の水準を40%以上上回っていると説明されており、これが新規供給を抑制する一方で、再構築コストや開発コストを押し上げています。

アナリスト質疑応答の要点

RevPAR構成と稼働率の上振れ余地：経営陣は、特に単価の高いリテール、法人契約、団体の各セグメントにおいて、週半ばの稼働率のさらなる回復余地が残されていると考えています。ポートフォリオの稼働率は依然としてコロナ前のピークを大幅に下回っています。

買収環境：サミットは複数の資産の審査（アンダーライティング）を積極的に進めています。経営陣は、強固な営業ファンダメンタルズ、魅力的な利回り特性、限定的な新規供給が、より魅力的な買収の機会を生み出していると述べました。

改修によるリターン：改装されたコートヤード・フォートローダーデール・ビーチは、事前査定を上回る業績を上げています。経営陣は、客室需要の拡大、アメニティ料、飲食売上の増加が純営業利益の増大につながっていると強調しました。

AIおよびデータセンター需要：経営陣は、AIインフラやデータセンターへの設備投資からポートフォリオが引き続き恩恵を受けていると述べました。支出の多くがすでに進行中であるため、短期的な影響は引き続きプラスに作用すると見込んでいます。

2027年の設備投資：サミットは正式な目標を設定していませんが、経営陣は2025年および2026年の水準に近い支出が適切な巡航ペースであると示唆しました。

決算説明会文字起こし全文

決算説明会の完全なトランスクリプト

経営陣による説明

Operator

Good day and thank you for standing by. Welcome to the Summit Hotel Properties Third Quarter 2026 Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to hand the conference over to your first speaker today, Kevin Milota, Senior Vice President of Finance. Please go ahead.

Kevin Milota

Thank you, operator and good morning. I'm joined today by Summit Hotel Properties' President and Chief Executive Officer, Jon Stanner; Adam Wudel, Executive Vice President and Chief Operating Officer; and Mike Nieves, Executive Vice President and Chief Financial Officer. Please note that many of our comments today are considered forward-looking statements as defined by federal securities laws. These statements are subject to risks and uncertainties, both known and unknown, as described in our SEC filings. Forward-looking statements that we make today are effective as of today, November 4, 2026 and we undertake no duty to update them later. You can find copies of our SEC filings in the earnings release, which contain reconciliations to non-GAAP financial measures referenced on this call, on our website at www.shpreit.com.

Please welcome Summit Hotel Properties' President and Chief Executive Officer, Jon Stanner.

Jonathan Stanner

Thank you, Kevin and good morning, everyone. Thank you for joining us today for our third quarter 2026 earnings conference call. On today's call, we will discuss our outstanding third quarter results and our improved outlook for the remainder of the year that together are driving another increase to our full year guidance ranges. We will also highlight the continued progress we have made strengthening our balance sheet, reducing borrowing costs, increasing liquidity and enhancing capacity for future growth.

Operating fundamentals accelerated meaningfully in the third quarter, exceeding our expectations as pro forma RevPAR increased 7.2% year-over-year, driven by a 5.3% increase in average daily rate and a 1.8% increase in occupancy. Top line growth accelerated from the strong results we delivered in the second quarter as both rate growth and occupancy gains expanded sequentially, highlighted by a quarter best 11% RevPAR growth in September. Hotel EBITDA in our pro forma portfolio increased a robust 14.4% in the third quarter, resulting in nearly 200 basis points of margin expansion as rate-driven RevPAR growth and ongoing strong cost controls drove exceptional profitability growth and nearly 60% flow-through. Adjusted EBITDAre increased 12% to $43.9 million and adjusted FFO increased to $24.2 million or $0.20 per share in the third quarter, an 18% increase over the third quarter of last year.

We are particularly encouraged by the continued breadth of strong performance across the vast majority of our markets and demand segments, led by midweek demand in urban markets. Our highest-rated demand segments continue to be our best-performing segments. Retail RevPAR in our pro forma portfolio increased approximately 15% in the quarter, driven by double-digit growth each month as our hotels continue to meaningfully outperform their competitive sets in both occupancy and rate. Corporate negotiated RevPAR, our best proxy for pure business transient demand, increased 8.3% in the quarter, driven by 17% growth in urban markets. Our hotels are consistently capturing a premium share of corporate negotiated demand, which we attribute to the quality of our assets and the effectiveness of our revenue strategy teams.

Group RevPAR increased 14.4% through both rate and occupancy gains with group room night mix continuing to expand as a share of our total business. All 3 months of the quarter achieved double-digit group RevPAR growth led by Charlotte, Indianapolis, Dallas-Fort Worth, Oklahoma City, Pittsburgh, Atlanta and Washington, D.C. The accelerating recovery in business travel continues to be a primary driver of our portfolio's growth and is facilitating a profitable remixing of occupancy, particularly mid-week. Weekday RevPAR increased nearly 8% in the third quarter, driven by broad-based strength across our highest-rated demand segments. Weekday retail RevPAR increased nearly 14% in the third quarter and weekday negotiated RevPAR increased by over 8% year-over-year. Weekday group RevPAR was particularly impressive, increasing by over 15% in each of the 3 months of the quarter.

This dynamic is creating segment and channel remixing opportunities for our revenue strategy teams, resulting in the best pricing environment we have experienced since prior to the pandemic. More importantly, it reflects compression-driven pricing power that generates the strongest flow-through to hotel profitability. This has been particularly beneficial to our urban-centric portfolio as RevPAR in our urban markets increased over 11% in the third quarter, the best of any location type for the second quarter in a row, led by Pittsburgh, Washington, D.C., Atlanta, Indianapolis, Dallas, Oklahoma City, San Francisco, New Orleans and San Jose, all of which had RevPAR growth exceeding 15% for the quarter.

ADR increased over 9% in our urban portfolio in the third quarter, driving a 26% increase in hotel EBITDA, highlighting not only the strong pricing power embedded in our urban hotels but also our ability to continue to effectively manage costs to drive tremendous bottom line growth. As a reminder, our urban portfolio comprises approximately half of our total rooms and hotel EBITDA and the accelerating momentum in this location type bodes well for our future growth. Encouragingly, RevPAR momentum built through the quarter. July RevPAR increased over 6%, reflecting solid underlying demand as well as some residual benefit from World Cup activity in our host markets during the early weeks of the month.

Consistent with our second quarter results, RevPAR growth in July was primarily rate driven. August RevPAR growth was approximately 4% and September was the standout month of the quarter with RevPAR growth increasing over 11%, driving a 15% increase in hotel EBITDA. We view the acceleration of demand growth in September across multiple segments and markets as particularly encouraging, supporting the durability of the favorable operating trends currently driving our business.

While FIFA demand provided another lift as expected during the quarter, it was less of a driver of our results than in the second quarter. We estimate World Cup-related demand added 80 to 90 basis points of RevPAR growth for the quarter, roughly half of the impact we benefited from in the second quarter. July RevPAR in our World Cup markets increased 11%, led by Miami, Dallas and San Jose, with pricing power particularly strong over the quarter and semifinal games. For the full year, we estimate that the event will contribute approximately 60 to 70 basis points to our full year RevPAR growth. We also gained another 110 basis points of market share relative to our competitive set in the third quarter as our pro forma RevPAR index was 116% for the quarter, exceeding the portfolio's typical prepandemic peak levels of between 113% and 115%.

Notably, RevPAR index in our NCI portfolio achieved the highest level of our ownership period at 125%, representing a nearly 6% gain in market share year-over-year. These consistent share gains reflect the quality of our assets, our strategic investment in renovations and the effectiveness of our operating teams. Nonrooms revenue, which increased approximately 11% in the third quarter, continues to support strong overall top line growth, driving a pro forma total revenue increase of 7.7% to $185.3 million in the quarter. As I mentioned, we achieved nearly 60% flow-through to hotel EBITDA in the third quarter as our operating teams did a tremendous job managing expenses. Total pro forma hotel operating expenses increased by just over 3% on a per occupied room basis during the third quarter, well below our rate of revenue growth. Total labor costs increased by approximately 5.5% year-over-year, with salaries and wages increasing approximately 3% and the balance driven primarily by higher incentive compensation associated with improved hotel level performance.

Portfolio-wide turnover remains stable and well below the elevated levels we experienced in prior years. And our hotels are operating with approximately 18% fewer FTEs per property compared to 2019, a structural productivity gain that continues to be a benefit of our highly efficient operating model. For the full year, we expect hotel operating expenses to increase by approximately 4%. Year-to-date through September 30, pro forma RevPAR increased 4%, driven by a 4.5% increase in average daily rate and pro forma hotel EBITDA increased 6%, with margins expanding 40 basis points. Adjusted EBITDAre increased 5.7% to $142.9 million and adjusted FFO increased to $0.70 per diluted share, representing a 6.1% increase compared to the same period last year. We continue to make meaningful progress strengthening the balance sheet, reducing borrowing costs and enhancing liquidity.

During the quarter, we amended our $200 million term loan facility and $275 million Delayed Draw Term Loan facility to conform pricing and other material terms with our recently amended $650 million senior credit facility. Based on our leverage as of September 30, these amendments resulted in a 20 basis point reduction in the applicable interest rate on those facilities. In addition, our ongoing deleveraging of the balance sheet has resulted in the reduction of our trailing 12-month leverage ratio and an additional 15 basis point reduction in the interest rate spread across $675 million of term loan debt and our corporate revolver. These spread reductions are expected to generate annual interest expense savings of approximately $2.4 million. We also continue to successfully sell noncore assets and recycle capital.

During the quarter, we completed the previously announced sale of our wholly owned 103-guestroom Courtyard and 96-guestroom Residence Inn in Dallas, Arlington South for a combined sale price of $19 million. The sale price represented a 5.9% capitalization rate based on trailing 12-month net operating income through June 30, 2026 and after consideration of approximately $7.6 million of foregone near-term capital expenditures at the 2 hotels. As we discussed last quarter, we strategically retained ownership of those hotels through the FIFA demand window before closing the transaction, which allowed us to capture the benefit of robust event-driven demand in the Arlington submarket prior to disposition.

Since 2023, the company has sold 15 hotels for a combined sale price of approximately $219 million at a blended capitalization rate of approximately 4.7%, inclusive of an estimated $68 million of foregone capital needs. The combined RevPAR for the sold hotels was $86, which is an approximate 30% discount to our current pro forma portfolio. We will continue to evaluate additional opportunities to recycle capital out of lower growth assets with outsized capital needs and redeploy proceeds to strengthen the balance sheet, increase liquidity, enhance the quality of the portfolio. The overall health of our balance sheet remains strong. We currently have approximately $350 million in total liquidity with nothing outstanding on our revolving credit facility and no debt maturities until 2028. Approximately 50% of our pro rata share of debt is fixed through interest rate derivative agreements. And including our 3 series of preferred stock, we are over 60% fixed on a pro rata basis. This combination of liquidity, manageable leverage and an extended maturity profile positions the company well going forward.

On October 27, 2026, our Board of Directors declared a quarterly common dividend of $0.08 per share, representing an annualized dividend yield of approximately 4.5% based on the November 2 closing stock price. The Board also declared the regular quarterly dividends on our Series E, Series F and Series Z preferred securities. The current common dividend continues to represent a modest AFFO payout ratio and reflects our ongoing objective of balancing shareholder returns with reinvestments in our portfolio and balance sheet discipline.

Turning to our outlook for the remainder of the year. In our earnings press release yesterday, we increased our full year guidance ranges for RevPAR growth, adjusted EBITDAre, adjusted FFO and adjusted FFO per share. For the full year, we now expect pro forma RevPAR growth of 3.5% to 4.5%, an increase of 150 basis points at the midpoint of the range. Adjusted EBITDAre of $181 million to $186 million, adjusted FFO of $102.5 million to $107.5 million and FFO per share of $0.85 to $0.89. The increase in our guidance ranges reflects both our outstanding third quarter results and the continued improvement we are seeing in operating trends. The midpoint of our adjusted EBITDAre range is increasing by $5 million and the midpoint of our adjusted FFO range is increasing by $0.05 per share or over 6% from our prior guidance range. This is the second consecutive quarter we've raised our full year outlook. And combined with our guidance increase last quarter, the midpoint of our adjusted EBITDA and adjusted FFO per share ranges have increased 5.5% and 10%, respectively, since the beginning of the year.

Operating trends have continued to trend positively into the fourth quarter as preliminary October RevPAR growth finished at approximately 5.5% in our pro forma portfolio and fourth quarter pace is up approximately 5% over last year. For the full year, we now expect pro forma hotel EBITDA margins to expand 25 to 50 basis points, driven by the strong rate-driven revenue growth and continued cost discipline. We expect pro rata interest expense, excluding the amortization of deferred financing costs, to be approximately $60 million and preferred distributions, including the Series E, F and Z securities to be $18.5 million. There are no additional acquisitions, dispositions, share repurchases or capital markets activities assumed in the company's full year outlook beyond those already reflected as of November 3, 2026.

Our guidance range for full year 2026 pro rata capital expenditures remains $55 million to $65 million. Current activity includes comprehensive renovations at our Hyatt Place Phoenix/Mesa, Hyatt House Orlando Universal, Courtyard Atlanta Decatur and Residence Inn Cleveland. We plan to commence renovations at 3 other hotels later this quarter and previously completed renovations at 3 hotels earlier this year. Looking forward, I want to share some initial thoughts on how we are thinking about the lodging environment in 2027. The operating trends we've experienced throughout 2026, highlighted by strengthening business transient demand, accelerating midweek compression in our urban markets, broad-based growth across our highest rated demand segments and continued group momentum, are trends we believe are durable and will carry into next year. Urban markets, in particular, continue to outperform and we see that momentum continuing into 2027 across many of our urban markets, supported by strong convention calendars in Minneapolis, Cleveland, Phoenix, San Francisco, Chicago, Orlando and Washington, D.C.

While we recognize that year-over-year comparisons will be modestly more challenging in certain markets, given the special event-driven tailwinds we experienced this year, the breadth and depth of demand across our portfolio gives us conviction that the fundamental recovery and acceleration of pricing and demand trends remains firmly intact. New hotel supply is expected to remain well below historical averages in 2027, which should continue to support pricing power across the vast majority of our markets. On the cost side, we remain focused on disciplined expense management and expect to maintain the operating efficiencies our teams have built over the last several years, facilitated by our assets' efficient operating models. Overall, we are optimistic about the operating environment next year and expect a continuation of many of the trends that have driven our strong results in 2026.

Before I open the call up for questions, I want to take a moment and highlight 2 important leadership appointments we announced last week. We are thrilled to welcome Mike Nieves to Summit as our new Executive Vice President and Chief Financial Officer. Mike brings a wealth of financial expertise and capital markets experience across the real estate, hospitality and entertainment sectors, most recently serving as Senior Vice President and Treasurer at PENN Entertainment. Mike will have the opportunity to meet many of you at Nareit later this month. I also want to congratulate Adam Wudel on his well-deserved promotion to Executive Vice President and Chief Operating Officer. Many of you know Adam and he has been instrumental to Summit's success over his 18-year tenure with the company, leading our asset management and revenue strategy teams as well as overseeing the company's investment activities. These 2 appointments round out our executive leadership team and I am thrilled to partner with them going forward.

In summary, we are encouraged by the accelerating operating trends and our outstanding third quarter financial results. We believe the long-term outlook for the lodging industry is profoundly positive as new hotel supply is expected to remain well below historical averages for several more years. Consumer prioritization of travel and experiences provides a secular tailwind that we expect to persist and corporate profits continue to grow at historically strong rates. The ongoing recovery in business travel is increasingly benefiting our urban-centric portfolio, evidenced by the midweek compression and pricing power we experienced throughout the third quarter. We believe these dynamics support continued top line growth and margin expansion through the balance of 2026 and beyond. With a strengthened balance sheet, a high-quality portfolio and accelerating operating momentum, we believe Summit is exceptionally well positioned to deliver strong shareholder returns going forward.

And with that, operator, we'd be happy to open the line for questions.

Operator

[Operator Instructions] And our first question comes from the line of Austin Wurschmidt of KeyBanc Capital Markets.

質疑応答

Austin Wurschmidt

Jon, you've talked a good bit this year just about how ADR growth has been the primary driver of RevPAR, benefiting from that ability to remix the business and really drive flow-through. Can you talk about how much of that remixing opportunity remains? And any segments that you see occupancy upside to layer on to the ADR growth opportunity that you've capitalized on this year?

Jonathan Stanner

Yes. Thanks, Austin. Yes, I think as we look at it, a lot of where our growth came from, specifically in the second and third quarters were midweek urban markets and a lot of it is BT-driven demand. And as strong as those demand patterns have been the last couple of quarters, we do still think there's plenty of room to run there. If you look industry-wide and our portfolio is no different, we're still running pretty meaningful discounts to kind of peak occupancies prior to the pandemic. And obviously, there's been very little supply growth. So I think there is still more opportunity, particularly midweek in some of those higher-rated segments to continue to drive occupancy, continue to shift our occupancy mix to more higher-rated demand, particularly retail negotiated and group demand and drive better kind of rate growth and profitability flow through as a result.

Austin Wurschmidt

I appreciate the answer there. And then on the capital recycling front, you touched on it a little bit but it looks like you've got some assets held for sale. Just can you talk just high level about how those are proceeding and then just planned use of proceeds?

Jonathan Stanner

Yes, sure. We do have 3 assets that are held for sale, as you'll see in our 10-Q. We have -- we're not far along -- far enough along in that process to talk specifics about the assets and the metrics. But I think consistent with what you've seen for us over really the past couple of years is we've tried to be very disciplined around recycling assets, recycling capital out of older assets that we just don't think have the same growth profile or kind of risk-adjusted return profile that where we can otherwise redeploy the proceeds. And it's resulted in us being able to deleverage the balance sheet. We've enhanced liquidity pretty meaningfully. These sales would add to that liquidity and we think gives us flexibility to evaluate future growth opportunities. And I think ultimately, we will improve the overall quality of the portfolio.

Austin Wurschmidt

Are you seeing opportunities out there start to become more available and sort of at a pricing level where bid-ask kind of makes sense between buyers and sellers?

Jonathan Stanner

Yes, we do. I think that this is becoming an increasingly interesting time to look at acquisitions. We've always felt like the first catalyst for more transaction activity has been better fundamentals. And we've obviously seen that now for the last 6 or 7 months. And I think naturally, that's going to facilitate more sellers coming to market and we're certainly active underwriting a number of assets. I think the combination of fairly compelling yield profiles and a lack of new supply does make this an interesting window for us to continue to evaluate opportunities to add to our portfolio and overall enhance the portfolio.

Operator

Our next question comes from the line of Logan Epstein of Wolfe Research.

Logan Epstein

Maybe one on the fourth quarter implied RevPAR growth. Just curious if you can talk about sort of both occupancy and rate growth in the third quarter, just what the expectation is for the decomposition of RevPAR growth in the fourth quarter and maybe how that trended in the 5.5% October number that you gave?

Jonathan Stanner

Yes. Logan, we are -- as you saw in the third quarter, our 7% plus RevPAR growth, about 6% was rate growth. The remaining of that was occupancy growth. We've obviously had much more rate-driven RevPAR growth this year than occupancy driven. And our expectation is that for that to continue into the fourth quarter. The majority of our RevPAR growth, we do expect to be rate growth. Obviously, we view that very favorably given it has better flow-through to the bottom line.

Logan Epstein

Got it. And then one more on -- I appreciate the thoughts earlier in the prepared remarks about the RevPAR index share gains across the broader portfolio. I was just curious if you can give an update on the Courtyard Oceanside in Fort Lauderdale, just how that's been performing post renovation last year. And if you can give an idea of what the RevPAR index there was prerenovation versus today as we head into the high season in a few months?

Jonathan Stanner

Sure. Yes. Look, we've been incredibly pleased with the performance of Oceanside coming out of the renovation. We're ahead of where we've underwritten. We're up. We're still lapping some of the renovation comps in the public spaces. But from a rooms perspective, we're up meaningfully year-over-year. Our index is increasing. I think maybe even more importantly than just the overall market share index has been our ability to drive very profitable out-of-room spend. We've implemented an amenity fee there that's flowing through at a very high level and creating meaningful incremental NOI growth. And then all the work we've done out on the deck overlooking the ocean and in the interior F&B spaces, we're driving significantly more F&B revenue and ultimately profitability there. So all in all, this was, as expected, a very kind of high ROI renovation for us.

Operator

Our next question comes from the line of R.J. Milligan of Raymond James.

R.J. Milligan

Jon, some pretty encouraging comments about 2027 in terms of top line growth demand. Maybe you could just give some color on how you expect expenses to trend 4% up so far this year and where you see that trending in '27?

Jonathan Stanner

Yes. Look, I think we feel like we're in a pretty good shape and we're in a pretty stable environment from an expense perspective. The 4% increase this year really just reflects really, really strong underlying revenue growth. And there is a portion of our expense base that is purely variable. So as we see better rate growth and better revenue growth across the business, expenses are growing a little bit higher. But in the third quarter, we grew expenses about 3% on a per occupied room basis. That does continue to feel like the right run rate for us. We obviously are benefiting meaningfully from the efficiencies of our operating model. We're running these hotels with about 20% fewer FTEs than we did prepandemic. A lot of those efficiencies, we think, are now structural and they should persist into next year. So we think in and around this kind of 3% per occupied room basis range is the right run rate from an expense perspective.

R.J. Milligan

That's helpful. And I guess, bigger picture and Jon, this might be a little early just given the election last night. But obviously, there's a little room left on the government-related demand. But you've also had some benefit from the AI and data center build-out. And I'm just curious, post the election results, how you think about those 2 demand drivers as we go into next year?

Jonathan Stanner

Yes. Well, there's definitely a lot of room left from a government perspective. We're obviously lapping the government shutdown comp in October and the first parts of November. So we're seeing very solid growth in government. And we really have seen decent growth in that segment in both the second and third quarter of this year and we expect that to continue into the first quarter. We're still well, well below previous peak levels and low 2024 levels in government travel. So we do think that there is more room to run from that perspective. The other segment that really hasn't recovered at all is international inbound travel, which I think is probably more of a long-term recovery but there's obviously much -- there's a lot of room to run from an international demand perspective.

Without question, we've been beneficiaries of the meaningful amounts of capital that's going into AI infrastructure spending, data center spending, et cetera. I think so much of that spending is already in progress. So it would be -- as you said, it's a little early to prognosticate how that will change. But at this point, we see the near-term implications continuing to be very positive for the portfolio given so much of that spending is already underway.

Operator

Our next question comes from the line of Chris Woronka of Deutsche Bank.

Chris Woronka

Wanted to ask, as we see Hyatt opening more of their -- the new extended-stay brand Studios and also more of the Select, whether it's conversions of current Hyatt brands or other brands, are you guys seeing any impacts, positive or negative in your -- I think you have 16 Hyatts in the portfolio -- are you seeing any impact when a new Hyatt brand comes into place? Just asking from the standpoint of, is the distribution system deep enough at this point to kind of hold up both properties in a market? And then I have a follow-up.

Jonathan Stanner

Sure. I think the simple answer is we're not but mostly because what's opened hasn't been in markets where we have exposure, certainly where we have existing Hyatt exposure. And I think that was frankly part of the thesis of both Studios and Select was finding these markets where there wasn't existing Hyatt exposure or product and becoming kind of the anchor Hyatt in some of those smaller, more tertiary or secondary markets. And so most of our Hyatts are in more primary urban markets. And so we really haven't seen any of that new product come in and have any type of negative effect on the Hyatt portfolio that we own today.

Chris Woronka

Okay. That's great to hear. And then the follow-up is, I don't know if you guys have ever really constructed like an internal estimate of NAV. And thinking probably more about it from the construction or replacement cost side of things, not necessarily from where you think the market might be. Have you done that internally? And maybe if you have, how has it changed in the last couple of years? I think we continue to see development costs rising across the board. So just kind of curious if you have thought about where your portfolio might land on that.

Jonathan Stanner

Yes, sure. We definitely take a view on that. It's not something that we typically discuss publicly. I think certainly from a replacement cost perspective, the implied stock value is certainly significantly below the cost it would take to replace the portfolio today. And as you alluded to, construction costs are probably up 40-plus percent from where they were prior to the pandemic. So it's part of the reason you're seeing very little supply growth across the industry is it's far more expensive to build. And until the last 6 or 7 months, you haven't seen a ton of growth in operating cash flows to keep pace with accelerating construction costs. And so I think at a minimum, it's safe to say that where the stock trades today is well below what a reasonable replacement cost would look like for the portfolio.

Operator

Our next question comes from the line of Michael Bellisario of Baird.

Michael Bellisario

Jon, I want to dig into '27 a little bit more. Just first, any updated thoughts on sort of the current RevPAR run rate ex some of these onetime benefits in sort of both years? And then how are you thinking about that underlying trend into next year and whether or not it might be able to accelerate or decelerate in '27?

Jonathan Stanner

Yes, sure. Look, we've spent a lot of time trying to assess what the run rate was, particularly over the summer months when we were getting some level of a lift from World Cup. And obviously, we spent a lot of time trying to normalize for that in June and July. I think when you look at going all the way back to kind of the middle of March through the end of October, even ex some of the special events and even if we try to adjust for some of the favorable holiday shift in calendar comparisons through the year, I still do believe that the industry and the business is running kind of mid-single digits. In some months, that's been a little bit higher from a growth rate perspective.

It's too early for us to really quantify what we -- how we think that's going to play into 2027. But I will say or maybe reiterate kind of what we said in the prepared remarks is, we do view a lot of the underlying trends, the strength in midweek, the strength in urban markets, the strength in our premium-rated demand segments, those trends we view as durable and we do expect many of them to persist into 2027. So we feel very good about the outlook. Obviously, we talked a little bit about what we're seeing early here in the fourth quarter with October finishing in at around 5.5% and our pace continues to look quite strong into the fourth quarter. So there's no question this is -- we're well beyond this being kind of special event driven. This is really strong underlying fundamental demand growth across a broad swath of our markets in many of our demand segments.

Michael Bellisario

Understood. That's helpful. And then just one more on next year. What are your initial thoughts on CapEx spending and whether you'll have more or less disruption throughout the portfolio? And that's all for me.

Jonathan Stanner

Sure. Look, I think, again, we're in the process of going through our budget and our planning for next year right now. So it would be premature for us to give an exact number. But I think we feel like we're at or above an appropriate run rate. If you look at our '25 and '26 CapEx spending, they're pretty well on top of each other. We're spending a little bit less this year. But I think in and around this level is the right run rate for us to think about going into next year.

Operator

This concludes the question-and-answer session. I'll now turn it back to Jon Stanner for closing remarks.

Jonathan Stanner

Great. Well, thank you all for joining us today. We look forward to seeing many of you in Atlanta in a couple of weeks for Nareit. Hope you all have a wonderful day. Thank you.

Operator

Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.