Pebblebrook Hotel Trust Q4 FY2025 earnings call

• Fourth quarter: Same property total rent bar increased 2.9% and same property hotel EBITDA grew 3.9% to 64.6 million. Adjusted EBITDA climbed 11.1% to 69.7 million. Adjusted FFO per share increased to 27 cents. • Resort portfolio: Continued to benefit from multi-year strategic reinvestment program. • Urban markets: Performance mixed but recovery cities showed improvement. • Cost control: Same property expenses rose 3% full year, excluding certain credits expense growth was 2.2%, energy cost growth held to ~2% for the year. Corporate level reduced staffing by ~10% year-over-year and lowered costs through process improvements. • Capital allocation: Invested $74.6 million in 2025, expect $65 to $75 million in 2026. Completed two strategic dispositions in Q4 for gross proceeds over $116 million, used proceeds for debt reduction and share repurchases.

Resort portfolio: In Q4, resort occupancy increased by roughly 160 basis points, driving total rep bar up 4.9% and same property resort EBITDA up 17.4%. Full-year resort EBITDA increased 1.3%. For example, Newport Harbor Island Resort in its first full year post-redevelopment had total rent bar increase 38.5% and EBITDA increase $9.3 million to $17.7 million. Urban markets: Performance mixed but overall direction improved in recovery cities. San Francisco led, with Q4 total rep bar increasing over 32%, full-year San Francisco portfolio rep-par grew 15.1%, hotel EBITDA 58.5%. Outside San Francisco, select urban markets like Portland and Chicago saw steady improvements, while markets like San Diego, Washington, D.C., and Los Angeles had market-specific disruptions.

• 2026 REVPAR growth expected to be 2% to 4%, total REVPAR forecasted to grow between 2.25% and 4.25%. • Same property EBITDA expected to increase by 2.1% to 6%, with midpoint at 4%. • Easy demand and performance comparisons to 2025, but cautious due to policy and geopolitical risks.

• Policy and geopolitical risks that could impact the expected outlook. • Weather and other unexpected events that may disrupt travel demand, such as winter storms affecting travel in certain months.

Q: John, on the group side, could you talk about composition of groups?

A: Most pace advantage in transient. Group room nights down 0.6% for the year, ADR up 2.4%, revenue up 1.8%. Transit room nights up 11.6%, ADR plus 0.6%, revenue plus 12.2%. Group PACE still widespread with softness in government-related industries but more realistic now.

Q: On resort portfolio unlevered cash returns, what's the outlook?

A: 2023 and 24 projects with over $100M ROI capital realized ~$20M, remaining $4 - $8M expected in next 2 - 3 years, cash ROI in 22% - 26% range. Strategic reinvestment program averaging closer to 16% - 17% annualized cash-in-cash ROI return.

Q: On lower implied REVPAR guidance despite strong calendar events, walk through puts and takes?

A: Last year went from significant PACE advantage to decline due to events. Outlook for last nine months of 2026 is 1% - 2% REVPAR growth, conservative due to macro uncertainty but trends positive except weather events.

Q: On transaction market, thoughts on portfolio and potential sales?

A: Market becoming more constructive, buyer depth improving. For 2023 and 24 projects, ROI and cash yield details. Also asked sell side to update numbers for asset sales.

Q: On balancing performance with asset sales and deleveraging, thoughts on Boston market EBITDA growth?

A: Dual approach of selling assets and buying back stock. Boston has large asset base, higher ADR assets, more meeting space and ancillary revenues, expected EBITDA growth from urban recovery.

Q: On CapEx outlook balancing tradeoff, thoughts?

A: Not deferring capital, constantly investing in infrastructure and interiors. Customer reviews and rankings show we're gaining share, leading to better ROI as capital is targeted to areas driving revenues.