Ashford Hospitality Trust, a real estate investment firm with 68 U.S. hotels in its portfolio, is seeking to offload even more of its lodging properties as it keeps trying to deleverage its balance sheet.
The Dallas-based REIT agreed to sell three of its hotels — La Posada de Santa Fe Resort & Spa for $57.5 million, the Hilton St. Petersburg Bayfront hotel for $96 million and the Embassy Suites Palm Beach Gardens hotel for $41 million. The Santa Fe and St. Petersburg properties are expected to close in coming weeks, said Stephen Zsigray, president and CEO of Ashford Hospitality, in a call discussing the company’s fourth quarter 2025 and fiscal 2025 financial performance.
“Opportunistic dispositions will remain a core component of our strategy in 2026 as we believe there are several additional assets in the portfolio that can yield similarly positive impact on leverage, cash flow after debt service and future capital expenditures,” Zsigray said during the call with investors.
“While we may not ultimately transact on all of them, we are currently marketing or negotiating off-market transactions on 18 additional hotels,” he added.
In the past year, Ashford Hospitality has sold six hotels with sales proceeds totaling $145 million. The deals also eliminated nearly $50 million in expected capital expenditures. The hotels were the Hilton Houston Clear Lake, The Residence Inn in Evansville, The Residence Inn in Sorrento Mesa, the Le Pavillon Hotel in New Orleans, the Embassy Suites in Houston and the Embassy Suites in Austin.
Ashford Hospitality’s decision to sell more of its U.S. hotels comes as the REIT reported a net loss of $78.3 million in the fourth quarter, as well as a net loss for the full fiscal year of $215 million. The losses are tied to ongoing lodging industry pressures, Zsigray told investors, including negative revenue per available room, substantial reductions of government spending, elevated interest rates and more demands for capital expenditures.
The REIT plans to keep carrying out the planned sales or transfers of properties to strengthen its capital structure, he said. In addition to selling off some of its hotels, Zsigray told investors that the company defaulted on its $325 million JPM8 mortgage loan secured by eight hotels.
“While we have engaged a special servicer and will continue to work towards a favorable resolution, disposition of these assets for the balance of the debt would represent a 6.2% trailing cap rate and would yield many of the same benefits for the portfolio as our ongoing sales efforts in terms of cash flow improvement and future capex savings,” Zsigray said.
The REIT did not take analyst questions during the earnings call. Ashford Hospitality did not immediately disclose to CoStar News the details behind the loan default or the names of the 18 hotels the REIT is seeking to sell.
Meanwhile, operations have also taken a hit. Government room night declined 27.9% during the fourth quarter compared with the prior year’s fourth quarter, the REIT said.
The Washington, D.C., market represents over 14% of Ashford Hospitality’s total key count, said Christopher Nixon, a senior vice president and head of asset management for the REIT, adding that the government shutdown had an outsized impact on its business.
In addition, results were comparing the fourth quarter of 2025 against the quarter in 2024 in which there was a presidential election, the executive added.
The closure of the Austin convention center also hit Ashford’s group and convention business, Nixon said.
This year, he said, he’s expecting a “robust pipeline of event-driven opportunities” including the Super Bowl in Santa Clara, California, and the 2026 FIFA World Cup, with 42% of its portfolio room count located within World Cup markets.
Zsigray remained optimistic while letting investors know liquidity would remain constrained as the REIT executes its plan to turn around the business. Focusing on performance and strategically selling property will “result in a leaner, stronger portfolio” positioning the REIT for growth, he said.