RLJ Lodging Trust: Q1 2026 10-Q Summary
Business Context and Reporting Period
This report covers the quarterly period ended March 31, 2026. RLJ Lodging Trust is a self-advised and self-administered Maryland REIT owning a portfolio of premium-branded, focused-service, and compact full-service hotels. As of the reporting date, the Company owned 93 hotel properties with approximately 20,800 rooms across 23 states and the District of Columbia. The Company operates through its Operating Partnership, in which it holds a 99.5% interest.
Key Financial Metrics
| Metric | Q1 2026 | Q1 2025 |
|---|---|---|
| Total Revenues | $339.98 million | $328.12 million |
| Net (Loss) Income | $(0.35) million | $3.17 million |
| Net Loss Attributable to Common Shareholders | $(6.42) million | $(2.92) million |
| Hotel EBITDA | $89.92 million | $85.91 million |
| Adjusted FFO | $49.52 million | $46.92 million |
| Operating Cash Flow | $26.21 million | $16.30 million |
| Total Debt (Net) | $2.19 billion | $2.20 billion |
| Cash & Restricted Cash | $387.46 million | $372.39 million |
| Comparable RevPAR | $148.55 | $141.80 |
| Comparable Occupancy | 70.8% | 69.0% |
| Comparable ADR | $209.91 | $205.51 |
Material Changes vs. Prior Period
- Revenue Growth: Total revenues increased by $11.9 million (3.6%) year-over-year, driven by a $7.6 million increase in room revenue and $2.2 million in food and beverage revenue. Comparable property room revenue grew $12.5 million due to increased leisure and corporate travel and the ramp-up of renovated hotels.
- Operating Expenses: Total property operating expenses rose $7.9 million, primarily due to higher wages, benefits, and utility costs at comparable properties.
- Net Loss: The Company reported a net loss of $0.35 million compared to net income of $3.17 million in Q1 2025. This shift was primarily due to a $3.6 million impairment loss recognized on a hotel property under contract for sale, compared to a $1.3 million gain on a hotel sale in the prior year.
- Capital Structure: The Company executed significant refinancing transactions in Q1 2026, extending maturities and upsizing term loans. The next scheduled debt maturity is now 2029.
Outlook, Management Commentary, and Risks
- Refinancing Strategy: Management completed a series of refinancing transactions, including extending the Revolver to 2030, upsizing a term loan to $569 million (delayed draw), and issuing a new $150 million delayed draw term loan. Proceeds are intended to repay the $500 million Senior Notes maturing in July 2026 prior to maturity.
- Share Repurchases: On April 24, 2026, the Board approved a new $250 million share repurchase program effective May 9, 2026, through May 8, 2027. No open market repurchases were made in Q1 2026; shares were only surrendered for tax withholding.
- Dividends: The Company declared a quarterly dividend of $0.15 per common share and $0.4875 per Series A Preferred Share.
- Risks: Primary market risk exposure is to interest rate fluctuations on variable-rate debt. As of March 31, 2026, 72.7% of total indebtedness was fixed or effectively fixed via interest rate swaps. A 100 basis point increase in rates on unhedged variable debt would decrease future earnings by approximately $6.0 million annually.
- Unusual Items: The $3.6 million loss on the sale of a hotel property (expected to close in Q2 2026) was a significant non-recurring item impacting net income.
Investor Verification Checklist
- Verify the closing of the hotel property sale expected in Q2 2026 and the final sale price relative to the $16.4 million carrying value.
- Confirm the repayment of the $500 million 2026 Senior Notes using proceeds from the new refinancing facilities before the July 2026 maturity.
- Monitor the utilization of the new $494 million in available delayed draw term loan commitments ($344M + $150M).
- Track the execution of the new $250 million share repurchase program starting May 2026.
- Review the impact of wage and utility inflation on future property operating expense margins.