Xenia Raises Guidance on Strong Group Demand, Sheds Underperforming Asset
Xenia Hotels & Resorts delivered another solid quarter, with same-property RevPAR up 5.6% on ADR growth of 5.7%, and management raised full-year adjusted EBITDAre guidance by $7 million to $273 million at the midpoint. The quarter was characterized by rate-driven growth, strong group demand ahead of the second half, and the sale of an underperforming asset. The company's shares have rallied 22.4% over the last 90 days, reflecting growing confidence in the portfolio's trajectory.
The Quarter in Numbers
The World Cup markets had a limited overall effect on the portfolio, as Marcel Verbaas noted: "While the World Cup certainly provided compression and rate growth around game days, the overall positive impact on our portfolio was limited." Group business in those markets was weaker due to room block releases and hesitancy from other customers, but transient demand filled the gap. “July RevPAR growth for our same-property portfolio which now excludes Kimpton RiverPlace Hotel, will be approximately 10% compared to the same period last year” — Marcel Verbaas, Chairman and Chief Executive Officer · 2026-07-30 — a strong start to the third quarter.
Guidance and operating trends: The company underscored the strength of its forward bookings. “we are raising the midpoint of our current full-year 2026 adjusted EBITDAre guidance by $7 million” — Marcel Verbaas, Chairman and Chief Executive Officer · 2026-07-30. Atish Shah highlighted that
That pace is now 80% demand driven and 20% rate driven, with more than three-quarters of expected second-half group business already booked.Group room revenue pace for the second half was up 12% at the end of June, versus the year prior.
Capital Allocation and Portfolio Repositioning
The transaction front saw the completion of the Kimpton RiverPlace Hotel sale for $11 million, a 19.4x EBITDA multiple. Marcel noted: “The transaction front, last week, we completed the sale of the 85-room Kimpton RiverPlace Hotel in Portland, Oregon.” — Marcel Verbaas, Chairman and Chief Executive Officer · 2026-07-30 This reflects a continued focus on portfolio quality and capital recycling.
Capital allocation remains a key theme. Atish emphasized the balance between investment, buybacks, and deleveraging. The company's leverage ratio is approximately 4.8x net debt to EBITDA, and the adjusted EBITDARE guidance reflects confidence in the second half. The company's transient pace is strong for August and September, supporting the outlook.
Fundamentals: Funds From Operations reached $53 million in the latest reported quarter, up 113% year-over-year, with a trend showing recovery from pandemic-era lows.
Prior Concerns Reversed
In May, management had noted a softer World Cup impact and a reduction in group blocks. “We have about half the level of group on the books for that period than we did several months ago.” — Atish Shah, Executive Vice President and Chief Financial Officer · 2026-05-01 That concern has now partially reversed with higher production in Q2. Similarly, in February, the company pointed to special events as a driver. “the couple of things bolstering the RevPAR outlook One is the special events, as you mentioned, and second would be Grand Hyatt Scottsdale” — Atish Shah, Executive Vice President and Chief Financial Officer · 2026-02-24 — but the current quarter shows the portfolio is outperforming those event-related expectations.
Overall, Xenia's message is one of momentum: strong group demand, a healthy high-end consumer, and a low-supply environment. The raise in guidance and the July performance confirm that the World Cup distraction was temporary, and the core business is accelerating.