Park Hotels & Resorts Q1 Earnings Call Highlights

Q1 results came in ahead of expectations with comparable hotel RevPAR up about 5.5% year‑over‑year excluding the Royal Palm and resort RevPAR up 7.6%, and management raised full‑year RevPAR and profitability guidance (adjusted EBITDA to $587–$617M and AFFO to $1.74–$1.90 per share).

Major renovation projects are central to the recovery: the Royal Palm South Beach is on track to reopen in early June with expected returns of 15–20% and EBITDA to more than double to ~$28M at stabilization, while 2026 capital spending is guided to $230–$260M including a ~$96M Ali’i Tower renovation in Hawaii (Royal Palm will modestly drag Q2 by nearly $3M).

Park is recycling capital and shoring up the balance sheet with ~$2 billion liquidity at quarter‑end and $31M of YTD non‑core sales, plus planned financings (a ~$700M delayed‑draw mortgage and an $800M term loan) to address maturities that will increase annualized interest expense by about $28M; the company reiterated its quarterly dividend of $0.25 per share.

Park Hotels & Resorts (NYSE:PK) reported first-quarter 2026 results that management said came in ahead of expectations, supported by strong leisure demand at resorts and healthy corporate group trends. On the call, Chairman and CEO Tom Baltimore said comparable hotel RevPAR rose 5.5% year-over-year excluding the Royal Palm South Beach Hotel, which suspended operations in mid-May 2025 for a comprehensive renovation.

First-quarter performance beats expectations

Baltimore highlighted strength across the quarter, with RevPAR growth excluding Royal Palm of “over 6.5% in January, approximately 3.5% in February, and nearly 6.5% in March.” He said results were led by Park’s resort portfolio, where RevPAR increased 7.6% excluding Royal Palm, while urban hotels produced “over 2% RevPAR growth” on the back of corporate group demand.

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CFO and COO Sean Dell’Orto said first-quarter RevPAR exceeded $191, up about 2% year-over-year, or about 5.5% excluding Miami. He added that RevPAR growth was “over 6.2%” when also adjusting for storm disruption in Hawaii. Total hotel revenues were $591 million, up nearly 2%, and hotel adjusted EBITDA was $152 million, implying a hotel adjusted EBITDA margin of roughly 26%. Dell’Orto said adjusted EBITDA was $143 million and adjusted FFO per share was $0.45.

Dell’Orto noted several comparability headwinds within the core portfolio, including typical comparisons at Park’s Washington, D.C.-area hotels following last year’s presidential inauguration, plus a drag as the Hilton New Orleans Riverside lapped last year’s Super Bowl.

Property-level highlights: Orlando, Key West, Southern California, and Hawaii

Baltimore pointed to outsized gains at several assets:

Orlando (Bonnet Creek complex): RevPAR grew about 16% and hotel adjusted EBITDA increased 20% year-over-year, driven by a 10% increase in transient revenues and a 19% rise in group production. Baltimore said trailing 12-month EBITDA exceeded $103 million, nearly 60% above pre-renovation levels and $20 million (24%) above Park’s projections.

Key West (Casa Marina and The Reach): RevPAR rose nearly 9%, helped by transient demand and holiday calendar shifts. Baltimore said Casa Marina’s trailing 12-month EBITDA was nearly $36 million, exceeding Park’s projections by more than $4 million (about 14%).

Southern California: The Hilton Santa Barbara posted nearly 23% RevPAR growth, driven by a roughly 13 percentage point occupancy increase and a 3% ADR gain. The Hyatt Regency Mission Bay produced 12% RevPAR growth on “continued strength in drive to leisure demand,” Baltimore said.

Hawaii: Across Hilton Hawaiian Village and Waikoloa Village, Baltimore said RevPAR increased 2% combined, or about 5.4% when accounting for a 340 basis point drag from storms. Waikoloa Village delivered 6% growth, while Hilton Hawaiian Village RevPAR rose 1% (or “over 4%” when adjusting for storms), aided by higher-rated transient demand in the renovated Rainbow Tower.

In response to analyst questions, Baltimore framed Hawaii’s longer-term recovery around limited supply growth through 2030, continued capital investment, and mix shift away from Japanese visitation. He said Japanese traveler demand is about 750,000 visits versus roughly 1.5 million historically, and that Japanese travelers now account for about 3% of Park’s business in Hawaii versus the “high teens” pre-pandemic.

On market share, Dell’Orto said the Hilton Hawaiian Village RevPAR index is currently tracking “in that 95-100” range, with a longer-term target of returning to “that historical levels of 110-115 range” as renovations are completed and rate profile improves.

Renovations and capital investment plans

Management provided updates on major projects, led by the Royal Palm South Beach repositioning. Baltimore said Park remains on track for completion by early June and noted early traction in group demand, with the hotel securing $1.4 million of group business as of the end of the first quarter for 2027 at an average rate of $460. He said this was up 108 rooms, or 31%, versus the pace for 2024 at the same point pre-renovation.

Baltimore reiterated Park’s return expectations for Royal Palm of 15% to 20% and said Park expects EBITDA to more than double from about $14 million to $28 million at stabilization.

Dell’Orto said Park expects Royal Palm to remain a drag in the second quarter as staffing ramps ahead of reopening and demand rebuilds through the third quarter. He said the company is forecasting “a nearly $3 million loss for Q2” at the property, but expects a quicker ramp in the back half of the year.

In Hawaii, Dell’Orto said Park completed the second and final phase of renovations at the Rainbow Tower and Palace Tower, with phase-two investment totaling about $85 million. Looking to the rest of 2026, Park guided to a lower overall level of capital investment, with planned spend of $230 million to $260 million, including Royal Palm completion and the start of the Ali’i Tower renovation at Hilton Hawaiian Village. The Ali’i project is expected to cost about $96 million and cover 351 rooms, the tower lobby, a private pool, and three new keys. Dell’Orto said the tower closure should have a “modest impact” in 2026, with less than $2 million of hotel adjusted EBITDA impact and about a 10 basis point effect on portfolio RevPAR.

Asset sales, non-core dispositions, and debt maturity strategy

Park continued its capital recycling efforts during the quarter. Baltimore said the company sold the 396-room Hilton Seattle Airport Hotel—located on a short-term ground lease—for $18 million, following the January disposition of the Hilton Checkers in downtown Los Angeles. Combined, he said year-to-date non-core asset sales totaled $31 million, or 16x 2025 EBITDA when accounting for nearly $36 million of expected CapEx for the two properties.

Addressing questions about remaining non-core assets, Baltimore said Park has 12 hotels it defines as non-core within a 33-asset portfolio. He noted that three of the non-core hotels are tied to a dispute with Safehold, and that the remaining nine assets account for about $41 million in EBITDA, with roughly 45% of that tied to one Florida asset. He said Park has active workstreams and marketing efforts underway and is not “holding out for the last dollar,” but remains focused on counterparties that can execute.

On the balance sheet, Dell’Orto said liquidity at quarter-end was about $2 billion, including $156 million of cash and available capacity under a revolving credit facility and a delayed draw term loan. He also detailed progress on addressing 2026 maturities, including a $700 million floating-rate delayed draw mortgage on Bonnet Creek expected to close imminently at SOFR plus 225 basis points, combined with an $800 million delayed draw term loan. Dell’Orto said the plan includes repaying the $121 million Hyatt Regency Boston mortgage (maturing in July) and the $1.275 billion CMBS loan on Hilton Hawaiian Village (maturing in early November). He said the transactions are expected to increase annualized interest expense by about $28 million, with roughly $13 million included in 2026 AFFO guidance based on timing.

Park also reiterated its quarterly dividend of $0.25 per share, with Dell’Orto noting the second-quarter cash dividend was approved to be paid July 15 to stockholders of record as of June 30.

Guidance raised as group outlook improves, with macro risks monitored

Management raised full-year guidance following the first-quarter outperformance. Dell’Orto said Park increased its full-year RevPAR growth outlook by 50 basis points at the midpoint to a range of 0.5% to 2.5%, and lifted adjusted EBITDA guidance by $7 million at the midpoint to $587 million to $617 million. AFFO guidance increased by $0.01 at the midpoint to $1.74 to $1.90 per share. Dell’Orto also noted the sold Hilton Seattle Airport Hotel had been expected to contribute about $3 million in EBITDA for the remainder of the year.

For the second quarter, Dell’Orto said April RevPAR was expected to be flat (up 3% excluding Miami), May was the “weakest” setup with group pace down slightly, and June looked strong with group demand up nearly 10% and favorable comparisons across several markets. Overall, he said second-quarter RevPAR should come in around the midpoint of guidance, with about a 100 basis point drag from Miami.

On group demand, Baltimore said second-quarter group revenue pace was up about 4%, and full-year pace improved to about 3% growth excluding Royal Palm and Hilton Hawaiian Village (which is affected by a partial closure of the Honolulu Convention Center). In Q&A, Dell’Orto added that fourth-quarter group pace improved sequentially to about down 4% from down 8% previously.

Management also discussed potential demand catalysts and uncertainties. Baltimore cited anticipated “macro and lodging centric tailwinds” including fiscal stimulus, favorable tax policy, deregulation, possible rate cuts, and demand generators such as the World Cup and America’s 250th anniversary celebrations, while cautioning that geopolitical tensions and potential oil price impacts could pressure travel demand. On World Cup-related impacts, Dell’Orto said Park’s biggest portfolio exposure is in New York and Boston and characterized the event as a rate opportunity, though he added the impact “might come off a little bit” from earlier expectations.

Closing the call, Baltimore said the first quarter was “an encouraging start to the year,” and reiterated Park’s focus on renovating core assets, disposing of non-core hotels, and strengthening the balance sheet through maturity extensions and leverage reduction over time.

About Park Hotels & Resorts (NYSE:PK)

Park Hotels & Resorts Inc is a publicly traded real estate investment trust (REIT) specializing in luxury and upper-upscale hospitality properties. The company's primary business activity involves owning and leasing premier hotels and resorts across major urban and resort destinations. Through long-term management and franchise agreements with leading hotel operators, Park generates revenue from room nights, food and beverage offerings, meetings and events, and ancillary services.

Since its spin-off from Hilton Worldwide in January 2017, Park Hotels & Resorts has assembled a diversified portfolio of more than 60 properties.