04/05/2023 | by John Barwick
Building with Hotel Sign

Lodging/resorts REITs own nearly 1,900 properties in the United States, facilitating the expansion of commerce and making leisure travel possible. The sector was hit particularly hard by the COVID-19 pandemic as both business and leisure travel was curtailed or postponed, resulting in lower demand for hotel space and revenue per available room (RevPAR).

After declining 86% in 2020, RevPAR for U.S. lodging/resorts REITs grew 262% in 2021, with the growth continuing at 36% in 2022.

As reported in Nareit’s T-Tracker, lodging/resorts REITs posted $3.6 billion in funds from operations in 2022, a significant increase from the $519 million reported in 2021. Similarly, dividends paid by the sector rebounded, reaching $636 million in 2022, up from $205 million paid in 2021.

On a total return basis, the sector is up 3.0% year-to-date as of March 31. Lodging/resorts REITs have remained net acquirors of properties since the beginning of the pandemic, and looking ahead to 2023, the sector is well-positioned for a higher interest rate environment:

  • 75%: Fixed-rate debt makes up 75% of the sector’s total debt, up from 71% in 2019
  • 5.5x: At year-end, debt to EBITDA for lodging/resorts REITs was 5.5x
  • 5.8x: At year-end, debt to EBITDA for All Equity REITs was 5.8x

Below is a list of Nareit member companies from the lodging/resorts sector.