With an expected rocky start to the year, Summit Hotel Properties finished its first quarter with momentum that President and CEO Jonathan Stanner said should continue into the second quarter as well as into the summer.
On Summit's first-quarter earnings call, Stanner said the company always anticipated the first three months of the year would be the toughest.
"We expected our first quarter to be the most challenging of the year, given multiple headwinds based in our portfolio, notably a difficult Super Bowl comparison in New Orleans, where we own six hotels, and continued weakness in government demand with [Department of Government Efficiency]-related travel cuts not lapping year-over-year comparisons until the March and April timeframe," Stanner said.
Despite these challenges, Stanner said March — particularly the last few weeks of March — "has been a pretty meaningful acceleration from our expectations."
"We believe March trends are more indicative of the underlying demand strength in our business, and have been pleased to see these trends continue in April," he said.
Stanner pointed to broad-based demand strength and pricing power across the portfolio, with business transient metrics improving. Mid-week revenue per available room increased 3% in the quarter, driven by a 10% increase in March. Summit saw double-digit growth in some of its urban markets, including Baltimore, Charlotte, Cleveland, Miami, Pittsburgh, San Francisco and Washington, D.C.
The company's government-driven business increased 3% in March, and Stanner said government demand, which represents about 5% to 7% of Summit's total guest room and revenue mix, could be a "potential modest tailwind."
"Our outlook for the remainder of the year has improved, driven by strengthening demand, trends that have persisted into the second quarter," Stanner said. "We are also approaching what is expected to be a robust summer of special events-driven demand."
He called out the 2026 FIFA World Cup specifically, as Summit has hotels in six host markets with 44 scheduled matches. These hotels in host cities represent a third of Summit's portfolio. He also mentioned the company's hotels in Boston, Washington, D.C., and Baltimore as standing to benefit from America 250-related travel.
William Conkling, Summit's executive vice president and chief financial officer, said some of Summit's core markets — including San Francisco and south Florida — had particularly strong results in the first quarter.
While Summit's three hotels in San Francisco benefitted from major conferences and the Super Bowl, south Florida posted gains thanks to peak season activity.
"Our Miami and Fort Lauderdale hotels delivered a strong first-quarter performance, with RevPAR growth exceeding 14% driven by a 9% increase in average daily rate in Miami," Conkling said. "Operating results were supported by peak season demand, several high-impact January events — including the NHL Winter Classic and the college football national championship — and a more condensed spring break calendar due to the shift of the Easter holiday to the first weekend in April."
Stanner added that the region benefitted from travelers pivoting to south Florida due to the unrest in Mexico.
In light of its first-quarter results, Summit raised its outlook slightly, bumping its pro forma RevPAR growth range to 0.5% to 3% growth from 0% to 3% growth.
Transaction activity
Summit's transaction activity is also credited for the company's increased optimism for the year. In February, the company completed the $12.3 million sale of the 122-room Hilton Garden Inn Longview, Texas, which was owned by Summit's joint venture with GIC.
In April, Summit entered into a purchase and sale agreement to sell two wholly owned hotels in north Texas. The 103-room Courtyard by Marriott Dallas Arlington South and the 96-room Residence Inn Dallas Arlington South are expected to sell for a combined $19 million, with closing expected in the third quarter.
Since 2023, Summit has sold or is under contract to sell 15 hotels for a combined sales price of approximately $218 million.
By the numbers
Summit Hotel Properties reported a net loss of $10.4 million in the first quarter, according to its earnings release, compared to a loss of $4.7 million in the first quarter of 2025. Summit's pro forma RevPAR rose 0.2% to $126.57 compared to the same period last year. Pro forma ADR increased 1.5% to $176.85 compared to the first quarter last year, and pro forma occupancy decreased 1.3% to 71.6%.
Adjusted earnings before interest expense, income taxes, depreciation and amortization for real estate was down to $44.2 million from $45 million in the first quarter of 2025.
As of press time, Summit’s stock was trading at $5.15 per share, up 24.7% year over year. The NYSE Composite Index was up 21.37% for the same period.