希尼亚酒店及度假村 (XHR) 2026年第三季度业绩电话会议：RevPAR增长12.5%，上调业绩指引

核心要点

• Xenia Hotels & Resorts公布2026年第三季度GAAP净亏损为270万美元，调整后EBITDAre为5320万美元，同比增长26%，调整后每股FFO为0.36美元，同比增长近57%。
• 同店RevPAR（平均可出租客房收入）增长12.5%至184.75美元。入住率上升380个基点至70%，平均每日房价（ADR）增长6.4%至264美元。
• 同店酒店EBITDA增长29.3%至6020万美元。由于收入增长快于营业费用增长，酒店EBITDA利润率扩大295个基点至22.9%。
• 在团体间夜数增长约11%的支撑下，团体客房收入增长16.2%。强劲的宴会及餐饮需求推动餐饮收入增长15%。
• 管理层将2026全年同店RevPAR增长指引上调至7.75%-8.25%，并将调整后每股稀释FFO指引上调至2.08美元-2.14美元。
• 预计10月同店RevPAR增长约8%。管理层表示，更强劲的商务散客和团体需求支撑了第四季度的前景展望。

关键财务数据

业务与运营表现

Xenia旗下29家酒店中有26家实现了RevPAR增长，其中14家酒店录得两位数增长。从市场层面看，22个市场中有21个实现增长。

费城以34.5%的RevPAR增长率领跑资产组合，其次是新奥尔良增长29%。圣迭戈和盐湖城均增长超过20%，而匹兹堡、圣克拉拉、达拉斯和奥兰多录得16%-18%的增长。

9月是本季度最强劲的月份。在入住率上升641个基点至73.5%以及ADR增长6.6%至282.26美元的支撑下，同店RevPAR增长16.8%至207.33美元。

团体业务是主要驱动力。团体客房收入增长16.2%，团体间夜数增长约11%。更高的宴会及餐饮收入促成了餐饮收入15%的增长。

周中需求也显著改善。周二和周三的平均入住率为76.3%，上升470个基点。这两晚的ADR增长7.9%，推动RevPAR增长14.9%。管理层将部分改善归因于更强劲的商务散客需求和更多的高需求满房日（compression nights）。

总营业费用增长8.5%，低于同店总收入12.7%的增幅。客房费用增长6.6%，餐饮费用增长10.3%。公用事业费用是显著的压力点，因入住率提升、多个市场的极端天气以及费用重新分类而增长了近14%。

Xenia在本季度投资1640万美元用于资产组合提升，使今年以来的资本支出达到4700万美元。纳帕安达仕酒店（Andaz Napa）和丹佛丽思卡尔顿酒店（The Ritz-Carlton, Denver）的翻修计划于2026年11月开始，施工时间安排在需求较低的淡季。

管理层指引

更新后的全年RevPAR中值意味着第四季度增长约7%。管理层表示，10月份预估约8%的增长支撑了这一展望。

展望2027年，管理层预计商务散客增长动能将持续，但表示该表态属初步性质。2026年第三季度末，团体客房预订进度同比下降约4%，这完全受下半年拖累；上半年预订进度大致持平。2027年预期团体客房收入中约有一半已确定，符合公司的历史预订规律。

管理层预计斯考茨代尔大君悦酒店（Grand Hyatt Scottsdale）的酒店EBITDA将从2026年的3000万出头美元区间增长至2027年的3000万高段美元区间。公司继续以4000万出头美元区间的稳定水平为目标。

风险与关注事项

• Xenia估计，与2026年特殊事件对比带来的高基数效应，将在2027年前三个季度造成50个基点的RevPAR阻力和300万美元的EBITDA阻力。
• 2027年下半年的团体预订进度低于上年同期对比，不过管理层表示，该期间约三分之二的团体业务仍有待预订。
• 新奥尔良得益于上年同期的低基数，但其RevPAR水平仍实质性低于整体资产组合。
• 有三家酒店的RevPAR未实现增长：萨凡纳安达仕酒店（Andaz Savannah）下降4.5%，萨凡纳ORE酒店（Hotel ORE in Savannah）下降1.3%，圣迭戈安达仕酒店（Andaz San Diego）持平。
• 管理层预计，2027年因翻修导致的EBITDA损失（displacement）约为100万美元，主要集中在第一季度。

分析师问答亮点

管理层表示，收购机会看起来比近年来更为有利，但目前尚无即将来临的交易。Xenia将继续在收购、偿还债务和投资现有资产之间进行权衡。

在商务散客需求方面，管理层指出最大的超预期因素来自于无法提前太久预测的业务，特别是在9月和10月期间。管理层表示，周二和周三的入住率仍比2019年水平低约7个百分点，留下了进一步复苏的空间。

斯考茨代尔大君悦酒店仍有望在2026年提升至3000万出头美元的酒店EBITDA区间。管理层表示，强劲的团体需求抵消了较为平缓的休闲市场需求，并支撑2027年盈利持续增长。

在纳什维尔W酒店（W Nashville），管理层报告称，在重新推出四家与何塞·安德烈斯（Jose Andres）合作的餐饮场所后取得环比进展。公司将团体餐饮和包场视为增量增长的潜在来源，尽管预计现金流收益将在几年内逐渐显现，而非对2026年产生实质影响。

业绩电话会议完整文字记录

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完整财报电话会议逐字稿

管理层陈述

Operator

Hello, everyone. Thank you for joining us, and welcome to Xenia Hotels & Resorts Q3 2026 Earnings Conference Call. [Operator Instructions].

I will now hand the conference over to Aldo Martinez, Director of Finance. Aldo, please go ahead.

Aldo Martinez

Thank you, Marina, and welcome to Xenia Hotels & Resorts Third Quarter 2026 Earnings Call and Webcast. Marcel Verbaas, our Chairman and Chief Executive Officer; Barry Bloom, our President and Chief Operating Officer; and Atish Shah, our Executive Vice President and Chief Financial Officer. Marcel will begin with a discussion on our performance. Barry will follow with more details on operating trends and capital expenditure projects. And Atish will conclude today's remarks on our balance sheet and outlook. We will then open up the call for Q&A.

Before we get started, let me remind everyone that certain statements made on this call are not historical facts and are considered forward-looking statements. These statements are subject to numerous risks and uncertainties as described in our annual report on Form 10-K and other SEC filings, which could cause our actual results to differ materially from those expressed in or implied by our comments. Forward-looking statements in the earnings release that we issued this morning, along with the comments on this call, are made only as of today, November 3, 2026, and we undertake no obligation to publicly update any of these forward-looking statements as actual events unfold.

You can find a reconciliation of non-GAAP financial measures to net income as well as definitions of certain items referred to in our remarks in our third quarter earnings release, which is available on the Investor Relations section of our website. The property level information we'll be speaking about today is on a same property basis for all 29 hotels unless specified otherwise. An archive of this call will be available on our website for 90 days.

I will now turn it over to Marcel to get started.

Marcel Verbaas

Thanks, Aldo, and good afternoon, everyone. Our portfolio delivered an outstanding third quarter with results that substantially exceeded the expectations we outlined on our second quarter earnings call at the end of July. Group demand was very strong as anticipated and grew significantly compared to the softer demand we experienced in the third quarter of last year. Additionally, corporate transient demand continued to strengthen and demand from the higher-end leisure customer remained resilient. Importantly, the strong top line performance carried through to the bottom line with nearly 300 basis points of hotel EBITDA margin expansion compared to the same period last year.

On a GAAP basis, this morning, we reported a net loss of $2.7 million for the quarter. Adjusted EBITDAre was $53.2 million, an increase of 26%, and adjusted FFO per share was $0.36, up almost 57% from the same quarter last year. This significant growth reflects both the strength of our operating results and the benefit of a lower share count following the significant CR repurchases we completed last year.

Same-property RevPAR for our 29-hotel portfolio was $184.75, an increase of 12.5% compared to the third quarter of 2025. After a second quarter in which our RevPAR growth came entirely from rate, this quarter's gains were well balanced between occupancy and average daily rate, which we feel is a healthy sign of demand across the portfolio.

While certain markets in our portfolio benefited from event-driven demand in July, including the FIFA World Cup at America 250, it is noteworthy that August and September delivered strong RevPAR gains as well with September 16.8% RevPAR increase leading the quarter.

Diving into our markets. In the third quarter, 21 of our 22 markets experienced RevPAR increases with 13 of those achieving double-digit growth versus the third quarter of 2025. Philadelphia, which benefited from several large events, led the portfolio with RevPAR up 34.5%, followed by New Orleans at 29%; and San Diego and Salt Lake City, each also up in excess of 20%. Pittsburgh, Santa Clara, Dallas and Orlando also had very strong results during the quarter with each of those markets up between 16% and 18%.

As we anticipated when we last reported, the second quarter's gap between same-property RevPAR and total RevPAR growth which was driven by lower contributions from group demand did not continue into the third quarter. Same-property total RevPAR growth of 12.7% for the third quarter exceeded our 12.5% RevPAR growth as group demand and banquet and catering revenue increased meaningfully compared to last year. In a number of markets, healthy group business drove even greater growth in total RevPAR, most notably in San Diego, up more than 26% and in Houston of nearly 17% as our Houston hotels lapped a softer period last year.

Looking ahead, we do expect that RevPAR growth for the portfolio will now exceed total RevPAR growth for full year 2026 as reflected by our updated guidance for both metrics. This is a result of much stronger RevPAR growth than we previously projected as well as the mix of our RevPAR growth rather than any softening in out-of-room spend.

Transient demand, which carries less ancillary revenues than group business has been much stronger than we previously anticipated. And a significant portion of our RevPAR growth has been fueled by increases in ADR. Third quarter same-property hotel EBITDA of $60.2 million was 29.3% above the same period in 2025 and same-property hotel EBITDA margin was 22.9% and an increase of nearly 300 basis points. The balance growth in occupancy and rate during the quarter allowed our hotels to leverage their fixed cost, while the rebound in group business drove a significant improvement in out-of-room profitability.

Our operators continue to do an excellent job managing costs, and we continue to work closely with them to manage expenses where possible. Barry will provide additional detail on our property level results during his remarks.

Turning to our capital expenditure projects. We now expect that we will spend $70 million to $75 million in property improvements during the year with 2 significant renovations scheduled to begin next month. At Andaz Napa, the first phase of a comprehensive renovation of guestrooms and corridors will commence. And at [indiscernible] in Denver, we will be upgrading the guest rooms, corridors and meeting space. Barry will also provide more color on all of our completed and ongoing capital projects.

As we have done throughout the history of the company, we will continue to evaluate additional opportunities to enhance the quality of our portfolio and drive adjusted FFO growth, whether through reinvestment in our existing motels, acquisitions or dispositions. The sale of the 85-room Kimpton RiverPlace Hotel in Portland that we discussed on our second quarter earnings call is an example of these disciplined capital allocation decisions. As a reminder, we sold a hotel in July for $11 million, which represented a 19.4x multiple on trailing 12-month hotel EBITDA and allowed us to excellent assets that face substantial near-term capital needs, amid an uncertain outlook for earnings growth.

Given our strong third quarter and our expectations for the remainder of the year, we are meaningfully raising our full year 2026 outlook. We now expect same-property RevPAR growth of 7.75% to 8.25%, an increase of 250 basis points at the midpoint compared to the guidance we provided after the second quarter. And we expect full year same-property total RevPAR growth of 7% to 7.5%, an increase of 150 basis points at the midpoint compared to prior guidance. These increases in expected full year revenues, coupled with improved margin performance are driving significant projected increases in adjusted EBITDA and adjusted FFO per share as well. Atish will walk through our updated guidance in more detail.

2026 is shaping up to be an exceptional year for Xenia. Our results have exceeded our expectations throughout the year, and we have raised our earnings outlook 3 quarters in a row. The fourth quarter is off to another promising start as we estimated the same property during the month of October increased approximately 8% compared to last year. The significant RevPAR increases during the important months of September and October were driven by both group and corporate transient demand, which is encouraging as we look ahead to next year. The recent investments we have made in our portfolio continue to pay off. Highlighted by Grand Hyatt Scottsdale continuing with its successful path towards stabilization at a significantly higher hotel EBITDA level than its prior peak.

We own a high-quality portfolio of luxury and upper -- upscale hotels in markets with limited new supply. We continue to maintain a strong and flexible balance sheet, and we have a proven track record of prudent capital allocation, leading to value creation for our shareholders. We are proud of what our team and our operating partners have accomplished over the past several years, and we are more confident than ever in the long-term earnings potential of our portfolio.

Barry will provide more detail on our operating results and capital projects.

Barry Bloom

Thank you, Marcel, and good afternoon, everyone. Our same property portfolio generated third quarter RevPAR of $184.75, up 12.5% from a year ago. Unlike last quarter, when growth was entirely rate driven, the third quarter gains were more balanced with occupancy rising 380 basis points to 70% and average daily rate increasing 6.4% to $264 when compared to the same period in 2025. Strong out-of-room spend lifted total RevPAR to $325.71, up 12.7% for the quarter, which, as Marcel mentioned, represents a strong rebound after a more subdued second quarter, primarily as a result of our group business mix.

We are pleased to report that for the third quarter, 26 of our 29 hotels grew RevPAR when compared to the third quarter of 2025 with 14 of those achieving double-digit percentage increases during the period. Our top performing hotels in the quarter were Kimpton Hotel Palomar Philadelphia, where RevPAR rose 34.5%, Loews New Orleans, up 29% and [indiscernible] of 28.5%, Iryo Woodlands Waterway up 23.9% and Kipton Hotel Monaco, Salt Lake City at Hyatt Regency Grand Cypress, each up nearly 21%.

RevPAR Fairmont Pittsburgh, Hyatt Regency Santa Clara, Marriott Dallas Downtown and Kimpton Canary Santa Barbara, each grew in mid- to high-teens percentages while Grand Hyatt Scottsdale continued its ramp towards stabilization with RevPAR of 12.5% at the resort. Only 3 of our hotels experienced RevPAR weakness compared to the third quarter of 2025 and including Andaz Savannah down 4.5%; Hotel ORE in Savannah, down 1.3% and Andaz SanDiego flat versus last year's third quarter.

By month for the third quarter, July same-property RevPAR was $180.40, an 11.7% increase over last year, with 367 basis points of occupancy gain and a 5.8% higher rate. August came in at $167.24, up 8.6% with rate up 6.3%. September was a standout month finishing at $207.33 of 16.8% as occupancy climbed 641 basis points to 73.5% and rate grew 6.6% to $282.26.

Group business was a clear driver of our results in the quarter. Same property group room increased 16.2% compared to the third quarter of 2025, driven primarily by volume with group room nights up approximately 11%, that represents our strongest quarter of group growth this year. This is despite the relative softness in group experienced in our World Cup markets were in July are reflective of the shift of both Jewish holidays to September with both falling on weekends this year. The increase in group volume also carried through to banquet and catering revenue, which was a primary driver of our 15% growth in food and beverage revenue for the quarter. Atish will provide more color on group pace for the fourth quarter and 2027 in his remarks.

Day of weak trends were solid in the third quarter, with RevPAR growing every night of the week. Across all segments, weekday RevPAR, Sunday through Thursday grew 12.6%, while weekend RevPAR Friday and Saturday, grew nearly 12%. And midweek occupancy was particularly strong, driven by both group and transient with Tuesday and Wednesday occupancy averaging 76.3%, up 470 basis points from last year. That additional demand created opportunities for meaningful rate compression with Tuesday and Wednesday ADR up 7.9% and RevPAR up 14.9%.

Now turning to expenses and profit. Third quarter same-property total revenue grew 12.7% year-over-year, outpacing total operating expense growth of 8.5%. As a result, hotel EBITDA of $60.2 million was up [indiscernible] versus 2025. Additionally, hotel EBITDA margin saw 295 basis points of margin expansion, climbing to 22.9% versus the third quarter of 2025.

Within the operating departments, rooms revenue grew 12.5%, while rooms expense rose only 6.6% with rooms expense per occupied room up less than 1% as occupancy increased by 4 points. Food & Beverage is a standout in the quarter with F&B revenue up 15% against expense growth of 10.3%, driven by increased banquet and catering revenues and strong group demand and reflecting an uptick in growth compared to both last quarter and the third quarter of last year.

Other operating departments, including spa, parking and golf grew 15.5% in the quarter, while miscellaneous income declined 5% and primarily due to lower cancellation and attrition revenue. Undistributed departments continue to be well controlled with expenses rising 7.8% in the third quarter, well below revenue growth. On a same-property basis, A&G expenses increased 10.2%, primarily driven by revenue-related costs, including credit card commissions.

Sales and marketing and repairs and maintenance grew more modest, 3.9% and 2.1%, respectively. Utilities, however, increased nearly 14%, driven by higher occupancy, several markets with extreme weather conditions and the salary reclassification of golf water expenses to this line item in 2026.

Now turning to CapEx. During the third quarter, we invested $16.4 million of portfolio improvements, which brings our total for the year to $47 million. We now expect full year capital expenditures of between $70 million and $75 million, reduction of $5 million at the high end of our prior range.

At Royal Palms Resort & Spa, we completed the renovation of the guest rooms and corridors in the 68 room Mana Vista building and the renovation of [indiscernible] restaurant. Additionally, in the third quarter, we performed work and continued planning minor guest room upgrades at 3 hotels, which are expected to be completed in 2026 or in the first quarter of 2027 based on hotel occupancy, as well as planning and/or execution of mechanical systems and infrastructure upgrades at 9 hotels.

The 2 significant renovations this year are still on track to begin next month. At Andaz Napa, the first phase of a comprehensive renovation of guest rooms and corridors, covering about half of the hotel's 141 rooms with completion expected in the first quarter of next year. As a reminder, the second phase will begin in the fourth quarter of 2027.

At the Ritz-Carlton, Denver, next month, we will begin a renovation of guest rooms, corridors and meeting space with completion expected in early March. Both projects are timed for lower demand periods to minimize disruption.

Turning to our 4 Marriott Autograph Collection hotels. Our hotels in Orlando and Savannah transitioned to their new names on September 1, followed by our hotels in Charleston and Mountain Brook on October 1. The Orlando hotels now named Hotel Bode. The Savannah Hotel is now Hotel Orel, the Charleston Hotels now Hotel Operas and Mountain Brook is now Hotel [indiscernible]. As a reminder, the hotels remain part of Marriott's Autograph Collection and the new identities reinforced the collections emphasis on distinctive properties to capture the character of their local markets. We made minor investments in these properties as part of the renaming and have also rebranded the primary restaurants and bars in both Orlando and Charleston.

As with the management transition at Davidson earlier this year, 3 names were completed with no meaningful disruption in hotel operations, and we look forward to the benefits of these repositionings under Davidson's management. With that, I will turn the call over to Atish.

Atish Shah

Thanks, Barry. I will provide an update on our balance sheet, walk through our updated guidance and provide some early thoughts on 2027. First, our balance sheet continues to be a source of strength. At quarter end, we had approximately $1.4 billion in outstanding debt, approximately 3/4 of which was at fixed interest rates. Our weighted average interest rate at quarter end was 5.55%. Our leverage ratio, as calculated under our credit facility was approximately 4.4x trailing 12-month net debt to EBITDA, down from 5.2x at the end of 2025.

Over time, we expect our leverage ratio to achieve our long-term target of sub-4x net debt to EBITDA. As a reminder, we have no preferred equity or senior capital. Our debt maturities continue to be well laddered with a weighted average duration of 2.6 years at quarter end. The only debt maturity next year is the Marriott San Francisco Airport mortgage loan, which we intend to pay off with existing liquidity early in the second quarter. At that time, 28 of our 29 hotels will be free of property level debt.

As to liquidity, we ended the third quarter with $161 million in available cash. Excluding restricted cash, our $500 million revolving line of credit continues to be fully undrawn. Therefore, total liquidity at quarter end was $661 million. As previously reported, our Board authorized a third quarter dividend of $0.14 per share. Our dividend continues to reflect the use of NOLs, which while we prioritize the uses of capital that we believe drive the most shareholder value, including investments in our existing portfolio.

We did not repurchase or issue any shares during the quarter. We have $97.5 million remaining on our buyback authorization and $200 million of capacity under our ATM offering program.

Now turning to our updated 2026 outlook, beginning with RevPAR. Our RevPAR growth is now expected to be 8% at the midpoint. This represents a 250 basis point increase to prior guidance and 500 basis points above our initial 2026 guidance. That increase captures both the strength of the third quarter and a more favorable view of the fourth quarter. Our full year midpoint implies RevPAR growth of roughly 7% for the fourth quarter, which is supported by our estimated October RevPAR growth of approximately 8%. On total RevPAR growth, our midpoint is now 7.25%, that is 150 basis points higher than prior guidance.

As to hotel EBITDA margin, we now anticipate full year expansion of approximately 120 basis points. You'll recall that we started the year expecting margin to decline slightly. Cost per occupied room is running up about 2.5% year-to-date versus the roughly 3% we had expected when the year began.

As adjusted EBITDAre, we have both raised and tightened our range. We now expect to earn $281 million at the midpoint, an increase of $8 million from last quarter and an increase of $21 million from our initial 2026 outlook. Adjusted FFO per diluted share is expected to be between $2.08 and $2.14. Lastly, we now project $26 million of full year G&A expense, an increase of approximately $1 million due to higher incentive compensation expense. Full year income tax expense moves the opposite way and is projected to be $1 million, which is down from $2 million per prior guidance.

For the full year 2026 at the midpoint of our guidance, we expect adjusted FFO per share to grow about 20% versus last year. From a free cash flow perspective after capital expenditures and before dividend, we expect over 45% growth versus 2025. On a per share basis, we expect about $1.35 of free cash flow. This equates to a free cash flow yield of over 6% based on our current share price. And again, that is after capital expenditures and before dividends.

Looking ahead to 2027, we would like to provide some initial thoughts. While it is still early, there are a handful of points we can share. First, on business transient demand, which is the biggest slice of the pie at about 40% of our overall revenue mix. We are expecting the momentum we experienced this fall to continue into next year. We expect midweek demand to continue recovering as we are still nearly 7 points behind 2019 occupancy across Tuesday and Wednesday nights with larger gaps on Mondays and Thursdays. Our operators are conducting corporate rate negotiations now, and we are hopeful for healthy revenue increases from this segment. We expect return to office and a healthy overall labor market to continue benefiting corporate transient demand.

Second, as to group demand, which reflects about 35% of our room revenue mix. While group is an important part of our mix, we are coming off a couple of very strong years of growth. By way of reminder, in 2025, group from revenue increased about 13% and year-to-date through September of this year, increased another 9%. As we look forward, we expect more normalized growth. As of the end of the third quarter, about half of our 2027 group room revenue was definite, which is generally in line with our historical pattern. Group room revenue pace for 2027 was down approximately 4% compared to the same time last year. The decline is all second half related.

First half group pace is roughly flat, which is important given that it's a seasonally stronger half of our portfolio given our Sunbelt orientation. Our hotel operating teams are focused on filling the current gap for the second half of 2027, and based on early budget discussions, we are expecting that they will do so in the months ahead.

Another point to keep in mind is at this time last year, we had approximately $2 million of FIFA-related group business that was canceled ahead of the tournament. Adjusting for those FIFA blocks, our group pace for the first half of next year would be slightly positive versus flat.

Looking across our group markets, the largest gains in 2027 group case are at both our resorts in the Phoenix Scottsdale area, the Marriott SFO and each of our hotels in Houston and Orlando. These gains are being driven primarily by in-house group business rather than big citywide conventions. The largest declines are concentrated in a few markets that are lapping special events such as the Super Bowl, FIFA World Cup or America 250 as well as some soft citywide calendars in markets such as Portland.

Third, moving ahead to leisure demand, which drives about 25% of our overall room revenue mix. Our assets in key leisure destinations continue to be well positioned to capture the high-end leisure traveler. A few of our leisure-focused hotels have meaningful gaps to 2019 occupancy levels. We expect our drive-to leisure hotels to continue to fare well from domestic peer markets.

Fourth, new hotel supply continues to be muted. Across our markets, we expect weighted supply growth to be less than 80 basis points in 2027, following approximately 1% growth in 2026. Across our 29 hotels, almost 40% are in market tracks with no supply growth expected next year.

Fifth, we're expecting Grand Hyatt Scottsdale hotel EBITDA to continue ramping from a low $30 million EBITDA range in 2026 to the high $30 million EBITDA range in 2027. We also expect the F&B improvements at W. Nashville and the renaming and relaunching the 4 Autograph Collection hotels to provide incremental year-over-year growth.

Lastly, we want to provide some initial thoughts on the year-over-year comparison. It's due to this year's special events, we estimate that in 2027, we will have a 50 basis point RevPAR headwind and a $3 million EBITDA headwind compared to 2026. The impact will be spread across the first 3 quarters of 2027. We believe the continued recovery in transient can more than offset this tough comparison. And as we look ahead to 2027, we do not expect renovations to generate incremental disruption relative to the amount of disruption expected this year.

In closing our high-quality portfolio positions us well for meaningful earnings growth. Over the next few years, we expect demand to further improve and pricing power to increase given the low supply growth backdrop. The operating leverage of our hotels, coupled with the financial leverage of the company and are expected to drive continued growth in earnings and cash flow per share in the years ahead.

And with that, we will turn the call back over to Marina to begin our Q&A session.

Operator

[Operator Instructions] Your first question comes from the line of David Katz with Jefferies.

分析师问答

David Katz

All seems to be, frankly, moving along quite well. I mean, with a bit of a noisy year, a bit of some noise in 2027. I just wonder like what your appetite and what the opportunity set looks like for you to maybe start playing offense and acquire your next meaningful asset?

Marcel Verbaas

David, thanks for the question. Yes. As you pointed out, I was very pleased with performance this year, and that's been somewhat reflected in the stock price kind of moving up throughout the year too, which does make acquisitions a bit more feasible as a potential capital allocation decision for us. We talked about it over the last couple of quarters that it does seem like the opportunity set is probably a little bit better than it has been over the last couple of years. So we certainly are looking at potential acquisitions and digging into some ways to potentially play offense going into 2027. But nothing imminent at this point.

We're obviously staying very disciplined in the way that we're reviewing the various opportunities, and we'll continue to look at that in line with any other capital allocation decisions we have coming up, which obviously includes some of the paying down the debt that Atish talked about, and some additional investments into our existing portfolio.

David Katz

Got it. And as my follow-up, we spend a decent amount of time talking with investors about relationships with the brands, generally speaking, not naming names. And over the years, it has seemed as though those are conversations that are always a thing, but they become a bit more of a topic among us these days. And I'd love your take on whether what we're hearing today is normal conversations that always go on? Or are they just a bit more intense with respect to things like fees structures, loyalty programs, et cetera?

Marcel Verbaas

Well, in general, I'd say that we talked about this before. I mean, we -- from our perspective, speaking just for us, it's hard to speak for everyone in the industry as well. We have very good relationships with the various brand companies. We believe strongly in the value that brands bring to a portfolio like ours, particularly with the type of assets that we own. And there are always conversations going on with stakeholders to make sure that we improve the outlook and growth for a portfolio like ours.

So we, from our side, welcome those discussions and I appreciate the fact that the brands are clearly focused on making sure that the business model works from an ownership perspective.

Operator

Your next question comes from the line of Michael Bellisario with Baird.

Michael Bellisario

First question, just want to dig into the group comments, Atish that you provided. Any stats that you guys can give us on certain markets that have more normal comparisons and not being affected by special events or onetime impacts. Just trying to get a better understanding of what the underlying run rate is, ex some of these onetime items that were such a big benefit this year?

Atish Shah

Yes. Thanks for the question, Michael. So I think if you back out, FIFA as I mentioned, were down slightly for the full year. And really, it's more a story first half versus second half. The first half for us actually looks flattish, slightly positive if you can back out that FIFA box that canceled. The second half is down. And frankly, we've got some time to fill in that second half, as I mentioned, or about half booked in terms of group business for the full year next year, but the second half is about 1/3 booked with 2/3 left to book. So still plenty of time there.

Some of our bigger assets that have done so well over the last couple of years are hanging in there, particularly, again, for the first half, and we see some opportunity in some of the markets that I mentioned like Portland some of the World Cup markets, Santa Clara that had the Super Bowl last year -- or sorry, this year, Dallas [indiscernible] some opportunities there for sure, particularly in the second half.

Michael Bellisario

Got it. Understood. And then just switching gears on Scottsville, I guess, maybe also related to group too, but just any update on the performance trajectory there? I get the numbers you gave for your expectation for '27, but any incremental color or learnings from meeting planners. And I guess at this point, do you think the stabilized earnings base of the hotel is higher today than it was, say, 12 months ago given the underlying performance there?

Marcel Verbaas

Big picture, Michael, I think we're on track. We continue to be on track with where we thought we would be getting to the low 30s this year like we've talked about. So that's obviously highly encouraging. We're still seeing good growth going into next year. Booking pace is still very good there. So Atish mentioned current expectation, and this is early because we're still going through the budgeting process is getting to that high 30s next year, and we still believe we will get to the low 40s on a stabilized level, like we've talked about before.

And I think part of it is really the strength that we've seen on the group side that has been very encouraging because we've talked about this a little bit over the last couple of quarters. The backdrop on the leisure side was a little bit more subdued than probably what we would have expected 18 months ago, 24 months ago, but it really has been kind of filled in by very robust group contribution. So it's all really playing out the way we were hoping it would. So we're very pleased with how it looks like we're tracking towards stabilization.

Operator

Your next question comes from the line of Aryeh Klein with BMO Capital Markets.

Aryeh Klein

Obviously, a lot of positive trends out there. Just curious, from your perspective, what's really been the biggest delta or upside delta versus your expectations? Is it largely BT related? Is it on the pricing side? Just curious your thoughts there.

Marcel Verbaas

Yes. I think it's been every segment to some extent. So clearly, we came into the year with a very robust group pace. And generally, as the year goes along, you see some of that kind of abating as the year goes on because you don't know a lot of open periods anymore in the book and things of that nature. But it held up very well in the periods that we thought would be very strong. So the third quarter, we knew was always setting up very nicely compared to where we were last year certainly. And that's held up very nicely.

I think the biggest upside really has come from the transient side though, the type of business that you can't forecast too far out. So that's where really the positive surprise has come from and particularly on the corporate transient side that has been very robust getting into September and October, and driving really a lot of that upside that we're reflecting in the updated guidance.

Barry Bloom

I think we've seen a meaningful increase, Aryeh, in compression dates, and that's been driven in part by the good group base. But I think when you look at it and as both Atish and I mentioned kind of that the Tuesday, Wednesday pattern has really been very, very strong and has provided for a lot of compression on rate on those nights in many markets and in particular, some of the markets where we have not been seeing that over the last few years, so -- which are some of our biggest commercial demand-driven markets like Santa Clara, San Francisco, Houston, Dallas.

I think that's really been probably something that the piece that we had not forecasted at the start of the year. We certainly hope for it, but we're very pleased to see that come through.

Aryeh Klein

And then maybe just on Nashville. RevPAR growth outperformed total RevPAR growth there by a little bit. I know you made some F&B changes there. Can you just update us on kind of how that's been progressing and how you're thinking about maybe the upside potential there in '27?

Barry Bloom

Yes. I think, coming out of the renovation relaunching of the restaurants in, I guess, early -- really by early Q2 of this year, I think we're seeing the kind of cadence and progression and growth in the outlets that we had expected to see. Keep in mind that 4 outlets all with new names, all with new concepts and all affiliated with Jose Andres. But we're seeing, I think, continue to both week-over-week and month-over-month growth in those outlets in a way that we would have expected the progression to be.

What we've always counted on there, I think, was the ability of those restaurants to be a driver of both in all segments of demand. So first, I think we've seen that in leisure demand that leisure guests are more likely to stay there because they have this choice of world-class outlets with a world-class celebrity chef, who's design the menus for those outlets.

I think it's also part of what we've seen in really strong successor this year in the negotiated corporate market, where we -- the number of accounts we've picked up that are new. I think, is partly related to the hotel itself in the room, but I think partly related to the opportunities that, that frequent business traveler has to stay in the hotel for a great dining experiences. And then I think the piece we have still yet to see and I think is part of what we view as upside for 2027 is the opportunity to really tie group into that and really using a lot of those outlets as private dining spaces for buyouts, both at lunch and dinner. The hotel, as you know, is relatively light on meeting space. So I think the ability to provide a really unique experiences in banquets for lunch and dinner within the confines of those outlets and utilizing those menus is one of the pieces we think we still have a lot of upside to grow into.

Marcel Verbaas

From a financial standpoint, Aryeh, it's obviously early days, and we've talked about this. As we talked about rolling this out to open up 4 new venues all at the same time. There's obviously a lot of heavy lifting on the properties part. So there's certainly some growing gains as we go through that. So it's really optimizing each of those operations also optimizing staffing levels, hours, those kind of things. So this is definitely not a 2026 story as it relates to kind of the cash flow impact. It is really something that over time needs to start building and where we hope to see it really becoming very fruitful as we go through the next several years.

Operator

Your next question comes from the line of Chris Darling with Green Street.

Chris Darling

You posted some pretty encouraging results in markets like Pittsburgh, Philly, New Orleans, these are also markets where you have a pretty significant amount of operating leverage. And so with that in mind, it'd be helpful if you could elaborate on the positive outcome this quarter, but also how you see performance trending in those markets on a go-forward basis?

Marcel Verbaas

Yes, specifically to the markets you mentioned, New Orleans, to be fair, came off a very weak base in the third quarter of last year. It's obviously an asset that is still operating at a RevPAR level that's pretty significantly below where you see the rest of our portfolio. So we look at that probably not as much as a driver for us going forward. Markets like Pittsburgh and Philadelphia have been highly encouraging for us. We've definitely seen -- we talked about the benefit that we saw in Philadelphia from some of the onetime events. Clearly, we did have the OSAR game, America 250, World Cup, there are some things that really did help the market and the property.

But overall, there seems to be some really good positive momentum in the Philadelphia markets as opposed to what we saw in the last several years. And Pittsburgh has been a really steady performer for us and has continued to benefit from both playing in kind of the leisure entertainment business, but also on the corporate transient side with some big corporate accounts that just really have come back to the office there over the last, really over the last few months even. So we continue to see some really good benefits from both the leisure and the corporate transient side in that market.

Chris Darling

Understood. And then Atish, in your prepared remarks around the sustainability of BT demand in the next year. I want to say you mentioned a 7-point occupancy gap between pre-COVID levels and sort of a run rate for BT. Could you maybe elaborate on that point, if I had that right, and maybe talk about where the opportunity might be greater across your market profile?

Atish Shah

Yes. Why don't I start on that one, and Barry can add to it as well. Yes, the point I was specifically referring to was really about midweek demand where we still have $700 basis points or 7 occupancy points in -- to make up relative to where we were on those nights Tuesday, Wednesday in 2019. So pretty big gap there. And really, what I'm speaking to there is, frankly, the potential for continued recovery. And then on Mondays and Thursdays, the gap is even larger.

So despite the fact that we've had a really good year of growth in BT, there's a lot more opportunity. And we think over time that we'll continue to normalize and BT will return to prior levels. Certainly, some of the things we're seeing, both in terms of growth in the economy, trends have returned to office, some of the trends on the corporate negotiated side, the healthy overall labor market. All those things I think will contribute to benefiting. And there's still a lot of potential just to get back in terms [indiscernible] where we were before.

So that's really how we think about BT evolving here over the next couple of few years. It's certainly a case where there's quite a bit of potential yet remain for recovery.

Operator

[Operator Instructions] Your next question comes from the line of Jamie Feldman with Wells Fargo.

Unknown Analyst

This is Connor on with Jamie. Maybe staying on the corporate transient and the strength there, are more hotels getting to the point of filling mid weak enough to push rate. And is this backdrop showing up in the corporate rate negotiations that you're having for 2027?

Barry Bloom

For sure, it's showing up in current months and a big part, I think, of the rate opportunity that we've been able to achieve has been because occupancy is definitely getting more compressed in midweek and particularly on Tuesdays and Wednesdays. How that trends to our managers being able to get higher pricing out of the largest volume accounts for 2027. It's still a little too early in the RFP season for us to know definitively. But certainly, historically, they've not had -- they've not done as well as I think we and other owners would like in terms of pushing rates for the largest negotiated accounts out there.

What we are doing, particularly as we look at at this fourth quarter of 2026 and look at 2027 is really encouraging our hotels to find opportunities that may be better than the large scale negotiated corporate accounts. In other words, taking more group midweek that may be driving a little lower rate, but driving substantially improved food and beverage contributions and really making sure that they -- where they are able to price and where they have accounted on dynamic pricing. They're working with the revenue management systems to really drive rate on those nights where they're -- where they have compression.

Atish Shah

The only thing I'll add is compression nights for us were up about 10% in the quarter and are running up in the kind of mid- to high-teens percent year-over-year year-to-date. So that story, which is not just BT oriented more broad, but that was a big piece and one of the reasons why not only are you seeing absolute rate increases, but mix shift that's driving rate increases as we take more of the retail rack type grades as opposed to a lower rate of business across a variety of days [indiscernible].

Unknown Analyst

I appreciate the color. And maybe with Napa and the [indiscernible] starting later this year, can you walk us through the EBITDA displacement we should think about for 2027 and whether that's mostly a first quarter event or extends further into the year?

Atish Shah

Yes. In terms of EBITDA displacement, we talked about roughly the same level of displacement as this year, so $1 million. And that $1 million will be more in the first quarter and then a little bit related to some other smaller projects later in the year. So really not a big number overall for our size company and [indiscernible] portfolio. So really, the point being that beyond really the couple of projects we talked about, we don't have major projects that would be overly disruptive.

Operator

There are no further questions at this time. I will now turn the call back to Marcel Verbaas for closing remarks.

Marcel Verbaas

Thanks, Maria. Thanks, everyone, for joining us today. Obviously, a very -- very pleased with our performance in the third quarter and the outlook for the remainder of this year. We continue to feel we're very well positioned for growth going forward. And we look forward to seeing many of you at the NAREIT conference in the next several weeks. And and we'll look forward to reporting again earlier -- early in 2027.

Operator

This concludes today's call. Thank you for attending. You may now disconnect.