Braemar Hotels & Resorts Reports $19.8 Million Net Income for 2024, Driven by Asset Sale Gains

Braemar Hotels & Resorts Inc. reported a net income of $19.8 million for the year ended December 31, 2024, a significant improvement from the net loss of $30.6 million in 2023. This change is largely attributed to an $88.2 million gain on the disposition of assets, primarily the sale of the Hilton La Jolla Torrey Pines in July 2024. Total hotel revenue decreased slightly by 1.5% to $728.4 million in 2024 compared to 2023, primarily due to the sale of the Hilton La Jolla Torrey Pines. However, key performance indicators for comparable hotels showed a slight increase in occupancy and a marginal increase in average daily rate (ADR).

Operating expenses for 2024 totaled $687.8 million, a decrease of 1.5% compared to 2023. While hotel operating expenses remained relatively stable, increases in property taxes, insurance, and depreciation were partially offset by a decrease in other operating expenses. The advisory services fee decreased by $602,000, primarily due to lower equity-based compensation, while corporate general and administrative expenses increased due to higher professional fees and legal costs. The company also noted a $6.1 million write-off of loan costs and exit fees in 2024, compared to $3.5 million in 2023.

Significant developments during the year included the sale of the Hilton La Jolla Torrey Pines, resulting in a substantial gain, and the refinancing of several mortgage loans, including a new $363 million loan secured by five hotels. The company also entered into a cooperation agreement with Blackwells Capital LLC, resulting in the withdrawal of a proxy campaign and the dismissal of pending litigation. Furthermore, Braemar provided an $8.1 million loan to BW Coinvest I, LLC to facilitate the purchase of 3.5 million shares of Braemar common stock. The company also amended its mortgage loan secured by the Ritz-Carlton Lake Tahoe, extending the maturity date and reducing the interest rate.

As of March 10, 2025, Braemar owned interests in 15 hotel properties with a total of 3,807 rooms. The company does not employ any personnel, relying instead on Ashford LLC for advisory services and various third-party management companies for hotel operations. The company's portfolio includes hotels operating under various brands, including Marriott, Hilton, Four Seasons, Hyatt, and Sofitel. The company's financial statements include the accounts of wholly-owned and majority-owned subsidiaries.

Braemar's outlook for 2025 includes a planned quarterly cash dividend of $0.05 per share for common stock, totaling $0.20 annually. The company anticipates using funds for capital expenditures estimated between $75 million and $95 million, and debt interest payments estimated at approximately $80 million. The company's liquidity and capital resources are expected to be met through net cash provided by operations, capital market activities, asset sales, and existing cash balances. However, the company acknowledges several risk factors, including those related to financing, competition, and maintaining its REIT status, which could materially affect its future performance.