Sotherly Hotels Inc. reported a total revenue of approximately $46.5 million for the three months ended March 31, 2024, marking a 7.0% increase from $43.5 million in the same period of 2023. This growth was primarily driven by a 4.5% increase in room occupancy across eight properties, contributing approximately $4.0 million to revenue. However, four properties experienced a revenue decline of about $1.0 million. The occupancy percentage for wholly-owned properties rose to 64.2%, compared to 60.5% in Q1 2023, while Revenue per Available Room (RevPAR) improved to $123.59 from $119.06.

The rooms department generated revenue of approximately $29.7 million, up 4.7% from $28.4 million in Q1 2023. Food and beverage revenue also saw an increase, reaching approximately $9.7 million, an 11.5% rise from $8.7 million. Total operating expenses for the quarter were approximately $40.9 million, up from $38.0 million in the prior year, leading to a net operating income of $5.7 million, slightly higher than $5.5 million in Q1 2023. However, net income decreased to $1.3 million from $1.4 million year-over-year.

As of March 31, 2024, Sotherly Hotels had total assets of approximately $404.7 million, up from $393.4 million at the end of 2023. Total liabilities increased to approximately $357.2 million from $345.5 million. The company’s stockholders’ equity decreased slightly to $48.8 million from $49.2 million.

In terms of strategic developments, Sotherly Hotels secured a $35.0 million mortgage loan on the Hotel Alba Tampa in February 2024, with net proceeds of approximately $10.2 million. The loan has a fixed interest rate of 8.49% and matures in March 2029. Additionally, the company amended the mortgage loan on the DoubleTree by Hilton Philadelphia Airport, extending its maturity to April 2026.

The company continues to face challenges with compliance regarding financial covenants on certain mortgages. As of March 31, 2024, it was in default on the mortgage for the DoubleTree by Hilton Philadelphia Airport but received a waiver for non-compliance. The company plans to address potential covenant breaches by prepaying or providing cash collateral.

Sotherly Hotels also reported a net cash increase of approximately $13.4 million during the quarter, with cash and cash equivalents totaling approximately $29.3 million. The company has resumed quarterly dividend payments on its preferred stock after a suspension during the pandemic, with cumulative unpaid dividends totaling approximately $21.9 million as of March 31, 2024.