San Clemente-based hotel owner Sunstone Hotel Investors Inc. said it expects a key measure of performance to rise slightly for the third quarter.
The company, which owns all or part of 31 hotels, said Friday its third-quarter revenue per available room—or sales from rooms available to guests during the quarter—is expected to come in 3% higher than a year earlier.
That would imply revenue per available room of about $105.
In the second quarter, Sunstone saw a 7% jump to $112 in revenue per available room.
“We expected year over year growth to moderate slightly in the third quarter due to a tougher comparison to last year at our large convention hotels,” Chief Executive Art Buser said. “Looking forward to the fourth quarter, we expect the year over year growth to accelerate.”
Sunstone released the estimate as part of a preview of its third-quarter earnings, which are due Nov. 4.
The company, which gave back some hotels to lenders during the downturn, also gave an update on its finances.
Sunstone said it is refinancing its Hilton Times Square hotel in New York. The hotel is set to have a 10-year mortgage at interest rate of 4.97%, down from 5.9%.
The company also finalized a $150 million credit line that has an option to expand to $250 million.
Sunstone has been looking to acquire hotels. Last month, the company paid $126 million at a foreclosure auction for the Royal Palm Hotel in Miami Beach.
In 2009, Buser sent shock waves through the industry by turning over the W Hotel in San Diego to its lender.
Sunstone became the first publicly traded owner in the downturn to hand back a hotel that no longer was worth what was owed on it.
Sunstone followed the W giveback by handing over eight more hotels to lender Massachusetts Mutual Life Insurance Co. The hotels, which the company refers to as the “Mass Mutual eight,” are in the process of being transferred.
The company has turned the givebacks into part of a larger strategy of bolstering the company’s portfolio by shedding underperforming hotels and buying better ones.
