Chatham Lodging Trust Reports 2025 Annual Results: Strategic Moves Amidst Challenges
1. Overview
Chatham Lodging Trust, a Maryland-based real estate investment trust (REIT), has released its annual report for the year ending December 31, 2025. Founded in 2009, the company focuses on upscale extended-stay and premium-branded select-service hotels, managing a diversified portfolio of 33 properties totaling 5,021 rooms across 15 states and the District of Columbia. This year’s financial results reflect a strategic approach to navigating a challenging market landscape marked by fluctuations in the hospitality sector.
2. Financial Performance Highlights
Year-End Comparison
Chatham Lodging Trust reported total revenue of $295.1 million for 2025, down from $317.2 million in 2024. The decline of $22.1 million can be largely attributed to the sale of seven hotels during the year, which significantly reduced revenue contributions. Despite this, the acquisition of a hotel in Phoenix, AZ, provided a silver lining, contributing $8.6 million in revenue.
Revenue Breakdown
The revenue streams for 2025 showed a continued emphasis on room revenue, which constituted 91.2% of total revenue, although it decreased from $290.3 million in 2024 to $269.2 million in 2025. Food and beverage revenue also saw a decline, from $7.7 million to $6.9 million.
Operating Expenses
Total hotel operating expenses dropped to $169.2 million, a decrease of 6.6% from 2024. This reduction was influenced by the operational costs associated with the seven sold hotels, which previously contributed significantly to expenses. Room expenses fell from $65.3 million to $59.8 million, reflecting the overall decrease in operational scale.
Depreciation and Amortization
Depreciation and amortization expenses slightly decreased from $60.7 million in 2024 to $59.7 million in 2025. Notably, the company recorded no impairment losses this year, contrasting with the $4.3 million impairment loss incurred in 2024 related to a hotel property sold during that time.
Net Income
Net income for 2025 surged to $15.3 million, a notable increase from the previous year's $4.0 million. This dramatic improvement underscores the company’s strategic maneuvers, particularly from hotel sales and careful management of expenses.
| Feb 2025 | Feb 2026 | |
|---|---|---|
Net Income | 4.16M | 15.05M |
Net Income to Non-controlling Interest | -131K | 260K |
Profit | 4.03M | 15.31M |
Net Income Continuing | 4.03M | 15.31M |
Pretax Income | 4.03M | 15.31M |
Non-operating Income | -29.18M | -25.56M |
Operating Income | 33.22M | 40.87M |
Revenue | 317.2M | 295.0M |
Costs and Expenses | 289.7M | 268.5M |
Cost of Revenue | 181.1M | 0 |
Operating Expenses | 108.5M | 169.1M |
Depreciation, Depletion & Amortization | 60.74M | 59.74M |
Impairment Expense | 4.25M | 0 |
Selling, General & Administrative | 42.09M | 16.58M |
Other Operating Expenses | 1.43M | 92.83M |
3. Key Transactions
During 2025, Chatham Lodging Trust successfully sold seven hotels across various locations, including Denver and Houston, generating a total gain of $14.4 million. This strategy aligns with the company’s goal of optimizing its portfolio for better long-term performance. The acquisition of a hotel in Phoenix served as a counterbalance to some of the revenue lost from these sales.
4. Financing Activities
In September 2025, Chatham Lodging Trust bolstered its financial flexibility by entering a new credit agreement, which established a $300 million unsecured revolving credit facility and a $200 million unsecured term loan. This new financing arrangement replaces previous credit facilities and is poised to support the company’s future investment initiatives.
5. Shareholder Activities
Chatham Lodging Trust declared a total dividend of $0.36 per common share for 2025, up from $0.28 in 2024, demonstrating its commitment to shareholder returns. The company also initiated a share repurchase program, repurchasing 1,313,795 common shares at an average price of $6.83, totaling approximately $9.0 million.
6. Challenges and Trends
Despite these positive developments, Chatham Lodging faced challenges due to inflationary pressures impacting operating costs and a competitive hospitality landscape. The overall U.S. lodging industry experienced fluctuations in revenue per available room (RevPAR), which decreased by 0.3% in 2025, contrasting with a prior increase of 1.8% in 2024.
7. Balance Sheet Overview
Chatham Lodging’s balance sheet reflects total assets of $1.17 billion as of December 31, 2025, a decrease from $1.25 billion in 2024. Total liabilities stood at $392.3 million, down from $462.6 million the previous year, alongside total equity and non-controlling interests of $778.0 million.
| Feb 2025 | Feb 2026 | |
|---|---|---|
Total Assets | 1.25B | 1.17B |
Real Estate Investments | 1.19B | 1.10B |
Cash and Equivalents | 20.19M | 24.43M |
Accounts Receivable | 2.92M | 2.83M |
Other Assets | 34.04M | 36.22M |
Total Liabilities and Equity | 1.25B | 1.17B |
Total Liabilities | 462.6M | 392.3M |
Debt and Capital Lease Obligations | 406.8M | 338.9M |
Accounts Payable and Accrued Liabilities | 29.62M | 26.64M |
Other Liabilities | 26.21M | 26.77M |
Total Equity and Non-controlling Interests | 791.9M | 778.0M |
Total Equity | 758.2M | 740.8M |
Non-controlling Interests | 33.77M | 37.24M |
8. Conclusion
Chatham Lodging Trust’s 2025 fiscal year was characterized by strategic asset management, enhanced financial arrangements, and a commitment to delivering value to shareholders. By navigating challenges in the hospitality sector and focusing on operational efficiency, the company is well-positioned for future growth opportunities, despite the headwinds faced in the broader market environment. The combination of prudent financial management and strategic acquisitions could yield positive outcomes as the industry stabilizes and recovers.
