Park Hotels Lifts Guidance as Q3 RevPAR Rises 8.4%

Park Hotels & Resorts (NYSE:PK) raised its full-year earnings and revenue outlook after third-quarter RevPAR rose 8.4% year over year to $201, beating the company's own expectations. The question for chief financial officers watching this REIT is whether the raise rests on durable demand or on properties freshly reopened with honeymoon economics.

Adjusted EBITDA came in at $135 million for the quarter, and adjusted FFO per share rose more than 11% to $0.39, according to Sean Dell'Orto, who serves as both chief financial officer and chief operating officer. Hotel adjusted EBITDA climbed 8%, with margin expanding 50 basis points to 25.7%.

The demand mix leaned toward groups:

• Group room revenue grew more than 18%.
• Transient revenue rose over 5%.
• Occupancy increased 2.4 percentage points; average daily rate advanced 5%.

Expenses rose 5%, and excluding Royal Palm, cost per occupied room increased 3.7%, including pressure from utilities. Park expects full-year expenses to rise approximately 4.5%, and fourth-quarter costs to climb 5.5%–6.5%, partly because of Royal Palm's reopening. Growth, in plain words, is arriving with a rising cost of delivery.

What did the guidance change?

Park lifted its full-year RevPAR growth forecast to 5.5%–6%, an increase of 200 basis points at the midpoint. The range implies fourth-quarter growth of 5.5%–7.5%.

Adjusted EBITDA guidance rose to $635 million–$645 million, roughly $13 million higher at the midpoint. The company also raised its adjusted FFO outlook by about $0.08 at the midpoint, to $2–$2.05 per share.

Preliminary October RevPAR rose nearly 11%, Dell'Orto said, helped by the reopening of Royal Palm South Beach and double-digit gains at Bonnet Creek, Key West and Washington, D.C. He added a caveat of his own: fourth-quarter total RevPAR growth should land closer to room RevPAR growth than it did in the third quarter, potentially toward the lower end of the implied range.

How much do renovations carry the story?

Chairman and Chief Executive Officer Tom Baltimore said Park's two Hawaii resorts increased RevPAR by 7% in the quarter despite three hurricanes, which the company estimates cut their combined growth by nearly 280 basis points. Group rooms revenue at the resorts more than doubled, and banquet and catering revenue rose 110%.

At Hilton Hawaiian Village, RevPAR grew 5% and occupancy reached nearly 90%. Park began a $100 million renovation of the Ali'i Tower in August and expects completion in early 2027; once finished, roughly 80% of the resort's rooms will have been renovated, Dell'Orto said. Baltimore put the Hawaii EBITDA gap to the 2023 peak at approximately $60 million, which he expects to close over the next few years as renovations finish and market share recovers. A multi-year recovery, in plain words, not a completed one.

In Miami, Royal Palm South Beach reopened in late July after an approximately $110 million renovation. Third-quarter average daily rate reached about $244, more than 30% above the comparable 2024 period, Baltimore said. He expects approximately $4 million in hotel adjusted EBITDA in the fourth quarter and $3 million for the full year — the full-year figure sits below the quarterly one, a reflection of the reopening's late start. For 2027, he expects Royal Palm's EBITDA to return at least to its roughly $14 million pre-renovation level, with the property contributing approximately 200 basis points to portfolio RevPAR growth next year as it works toward roughly $28 million of stabilized hotel adjusted EBITDA by 2028.

What is happening with asset sales and debt?

Park sold The Wade, a Chicago hotel, for approximately $19 million in October. Baltimore said the property had been expected to post an operating loss of roughly $1.3 million in 2026. Of 19 hotels originally identified as non-core, Park has sold or disposed of 11, generating about $220 million in gross proceeds. Three of the eight remaining are tied up in a dispute with Safehold and are not being marketed; Park is evaluating whether to retain and renovate Lake Buena Vista in Orlando while pursuing work on the other four.

Dell'Orto said Park repaid a $1.275 billion loan secured by Hilton Hawaiian Village in September, leaving no significant debt maturities until the fourth quarter of 2028. The relief carries a cost: he estimated that replacing roughly $1.5 billion of lower-rate debt with financing at around 6% to the low-6% range created an annual interest expense headwind of approximately $30 million, partly offset by potential savings as leverage declines.

After spending an expected $270 million–$280 million on capital improvements this year, Park anticipates reducing annual spending to $175 million–$185 million in 2027, Dell'Orto said. Core group revenue pace for 2027 was up nearly 6%, according to Baltimore.

Park, formed in 2017 through a spin-off from Hilton Worldwide Holdings, owns full-service hotels across gateway cities, convention markets and resort destinations. The guidance is raised; the proof arrives in 2027.