Ashford Hospitality Trust (NYSE:AHT) used its fourth-quarter 2025 earnings call to outline continued asset sales, a strategic review process, and operating results that management said reflected a difficult lodging backdrop alongside progress from its internal performance initiatives.
Strategic alternatives review and disposition strategy
President and CEO Stephen Zsigray reiterated that the company formed a special committee in early December to evaluate strategic alternatives intended to maximize shareholder value, including a potential transaction. Zsigray said the company remains “frustrated by the discrepancy” between the value of its underlying hotel portfolio and the market value of its common stock, and that the board has tasked the committee with exploring alternatives to address that gap. He added that the company did not have further details to share, but said any material updates would be publicly disseminated.
- Hilton Houston Clear Lake
- Residence Inn Evansville
- Residence Inn Sorrento Mesa
- Le Pavillon Hotel in New Orleans
- Embassy Suites in Houston
- Embassy Suites in Austin
Management said those sales generated approximately $145 million of proceeds at a blended 3.9% trailing cap rate, while eliminating nearly $50 million of anticipated capital expenditures. Proceeds were used primarily to pay down mortgage debt, which the company said resulted in approximately $5 million of improvement to annualized portfolio cash flow after debt service.
Zsigray also cited additional pending transactions. The company previously announced agreements to sell La Posada de Santa Fe Resort & Spa for $57.5 million and the Hilton St. Petersburg Bayfront for $96 million, both expected to close in the “coming weeks.” He added that the company signed an agreement to sell the Embassy Suites Palm Beach Gardens for $41 million. Collectively, management said these three sales represent a blended 6.9% trailing cap rate and are expected to reduce anticipated capital expenditures by an additional $45 million.
Looking further ahead, Zsigray said dispositions will remain a core part of the company’s 2026 strategy, and that Ashford is currently marketing or negotiating off-market transactions on 18 additional hotels, though he noted the company may not ultimately complete all of them.
Maturity default on JPM8 loan
Management also discussed a maturity default on the company’s JPM8 mortgage loan. Zsigray said the $325 million loan is secured by eight hotels that generated approximately $20.2 million in net operating income in 2025. He said the company has engaged with a special servicer and will continue working toward a favorable resolution.
Zsigray added that a disposition of those assets for the balance of the debt would represent a 6.2% trailing cap rate and could provide similar benefits to other sales, including improvements in cash flow and reduced future capital expenditure needs.
Financial results and balance sheet details
Chief Financial Officer Deric Eubanks reported a net loss attributable to common stockholders of $78.3 million, or $12.33 per diluted share, for the fourth quarter. For the full year, the company reported a net loss attributable to common stockholders of $215 million, or $35.99 per diluted share.
Adjusted results remained negative on an AFFO basis, with AFFO per diluted share of negative $2.45 for the quarter and negative $5.66 for the full year. Adjusted EBITDAre was $40.4 million in the fourth quarter and $221.3 million for the year.
On the capital structure, Eubanks said the company ended the quarter with $2.6 billion of loans at a blended average interest rate of 7.7%. Approximately 5% of debt is fixed, with 95% floating.
He also noted that in January 2026 Ashford extended its Highland mortgage loan, which is secured by 18 hotels. As a condition of the extension, the loan was paid down by $10 million to a balance of $723.6 million—about 65% of appraised value—and now has a final maturity date of July 9, 2026.
Liquidity at quarter-end included cash and cash equivalents of $66.8 million and restricted cash of $149.6 million, which management said largely consists of lender- and manager-held reserve accounts. Eubanks also reported $25.7 million due from third-party hotel managers, primarily cash held by one property manager and available to fund hotel operating costs. Net working capital was approximately $103.2 million.
As of December 31, 2025, the consolidated portfolio consisted of 68 hotels with 16,500 net rooms. Eubanks said the company had approximately 6.6 million fully diluted shares outstanding, including 6.5 million common shares and 0.1 million OP units.
Operating performance and demand trends
Executive Vice President and Head of Asset Management Chris Nixon said comparable hotel RevPAR declined 1.8% in the fourth quarter versus the prior-year period. He attributed much of that performance to a federal government shutdown that began in October, which drove government room nights down 27.9% year over year. Nixon noted that Washington, D.C. represents more than 14% of the company’s total key count, creating an outsized portfolio impact.
Excluding Washington, D.C., Nixon said comparable hotel RevPAR was flat and total revenue increased slightly. He also cited the absence of one-time events that benefited prior-year results, including the 2024 presidential election in Washington, D.C. In addition, he said demand was disrupted by the closure of a major convention center in Austin, which constrained group and convention demand for three properties during the quarter.
For full-year 2025, Nixon said total revenue increased 0.8%, driven by growth in other revenue, which rose 12.9% compared with the prior year. He reported that full-year hotel EBITDA increased 2.4% and that hotel EBITDA margin expanded by more than 40 basis points.
Group revenue declined 1.1% for the full year and fell 3.8% in the fourth quarter. However, excluding Washington, D.C., Nixon said group room revenue increased 1.6% for full-year 2025. He said resort assets performed particularly well, with group room revenue up 9% year over year, and highlighted Renaissance Palm Springs as a standout, reporting a 16.9% increase in group room revenue.
Looking to 2026, Nixon said group room revenue is pacing ahead by 1% in the first quarter and 3.3% in the second quarter compared with the prior-year periods, with group ADR pacing ahead across all quarters. He also pointed to event-driven opportunities, including the Super Bowl in Santa Clara and the 2026 FIFA World Cup, noting that approximately 42% of the portfolio’s room count is located within those markets.
GRO AHT initiatives and capital spending plans
Management emphasized ongoing efforts under its GRO AHT initiative, which Zsigray said contributed over $40 million in EBITDA improvement in 2025. Nixon said the initiative supported margin expansion through cost controls and growth in ancillary revenue streams, including improvements in food and beverage profitability in partnership with property managers and brand partners.
Nixon also highlighted performance at Le Méridien Fort Worth Downtown, which opened in August 2024 and completed its first comparable quarter in fourth-quarter 2025. He reported group room revenue growth of 201.2% in the quarter versus the prior year, food and beverage revenue growth of 59.4%, and a 48.3% increase in total revenue.
On capital expenditures, Nixon said Ashford invested approximately $71 million in 2025, including guest room renovations at Courtyard Bloomington and Embassy Suites West Palm Beach, public space enhancements at Hilton Garden Inn Austin and Hampton in Evansville, and the start of a public space renovation at Westin Princeton. He also discussed planned brand conversions at Sheraton Mission Valley and Sheraton Anchorage to Hyatt Regency hotels, with expected investment of more than $70 million across the two projects. For 2026, management anticipates spending between $90 million and $110 million on capital expenditures.
About Ashford Hospitality Trust (NYSE:AHT)
Ashford Hospitality Trust, Inc (NYSE: AHT) is a real estate investment trust that acquires, owns and operates upscale and upper-upscale full-service hotels in the United States. The company’s portfolio spans a variety of urban, resort and convention-oriented markets and includes both well-known national brands and independent properties. Ashford Hospitality Trust seeks to generate long-term value through active asset management, strategic acquisitions, dispositions and selective joint venture partnerships.
Founded in 2003 and headquartered in Dallas, Texas, Ashford Hospitality Trust invests in properties affiliated with leading hospitality brands, including Marriott, Hilton, Hyatt and Starwood.
