ORLANDO - Xenia Hotels & Resorts, Inc. (NYSE:XHR), a real estate investment trust (REIT) focused on luxury and upscale hotels, announced on Tuesday its intention to offer $365 million in senior notes due in 2030. The offering, subject to market and other conditions, will be conducted by its operating partnership, XHR LP.
The senior notes will be guaranteed by Xenia and certain subsidiaries that are also guarantors of the Issuer's other debts. The proceeds from the notes, along with borrowings under Xenia's amended credit agreement from November 4, 2024, aim to redeem its 6.375% senior notes due 2025 and cover related fees and expenses.
These notes and their guarantees will not be registered under the Securities Act of 1933 or any state securities laws, and they will be available only to qualified institutional buyers and certain non-U.S. persons in offshore transactions.
Xenia, which owns 31 hotels and resorts comprising 9,408 rooms across 14 states, operates properties under major brands like Marriott, Hyatt, and Hilton. The company's strategy targets the top 25 U.S. lodging markets and key leisure destinations.
The press release includes forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995, indicating management's expectations for future events. However, these statements are not guarantees of performance and are subject to risks and uncertainties that could cause actual results to differ materially.
The announcement does not constitute an offer to sell or a solicitation of an offer to buy the notes or any other securities, nor does it serve as a notice of redemption for the 6.375% senior notes due 2025.
This news is based on a press release statement from Xenia Hotels & Resorts, Inc. and does not constitute financial advice or an endorsement of the company's plans or securities.
In other recent news, Xenia Hotels & Resorts reported a net loss of $7.1 million for the recent third quarter, alongside an adjusted EBITDAre of $44.3 million. Despite challenges such as hurricanes and renovation disruptions, the company saw a RevPAR increase of 1.5% across its portfolio. Significant renovations at the Grand Hyatt Scottsdale Resort led to its relaunch, with substantial investment in improvements expected throughout the year. However, Xenia revised its full-year adjusted EBITDAre guidance downward due to recent demand trends and the impact of Hurricane Milton.
On a brighter note, the company maintains a positive outlook, with strong future group bookings and an increase in capital expenditures planned for the year. Moreover, the company's renovated properties, such as Grand Bohemian Orlando and Kimpton Canary Santa Barbara, have shown strong performance. Despite the downward revision of full-year adjusted EBITDAre guidance, Xenia Hotels & Resorts remains optimistic about its future performance, especially for 2025.
InvestingPro Insights
Xenia Hotels & Resorts' recent announcement of a $365 million senior notes offering aligns with several key financial metrics and trends highlighted by InvestingPro data. The company's market capitalization stands at $1.57 billion, reflecting its significant presence in the luxury and upscale hotel REIT sector.
An InvestingPro Tip indicates that Xenia is "trading near its 52-week high," with the stock price at 97.1% of its peak. This strong performance is further supported by a robust 22.46% price total return over the past three months, suggesting investor confidence in the company's strategic moves, including this debt refinancing initiative.
The company's dividend yield of 3.12% and a notable 20% dividend growth in the last twelve months may appeal to income-focused investors. This dividend strategy, coupled with the company's efforts to optimize its debt structure through the new notes offering, could contribute to its financial stability and shareholder returns.
InvestingPro data also reveals that Xenia's revenue for the last twelve months as of Q3 2024 was $1.03 billion, with a gross profit margin of 24.49%. While the company faces challenges with weak gross profit margins, as noted in another InvestingPro Tip, its focus on luxury and upscale properties in prime markets may help maintain its competitive edge.
For investors seeking a more comprehensive analysis, InvestingPro offers additional tips and insights. Currently, there are 8 more InvestingPro Tips available for Xenia Hotels & Resorts, providing a deeper understanding of the company's financial health and market position.
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