DiamondRock Sells Manhattan Hotel Asset for $33M
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 hour ago
0mins
Should l Buy DRH?
Source: seekingalpha
- Asset Sale: DiamondRock Hospitality announced on Monday the sale of its leasehold interest in the 189-room Courtyard by Marriott New York Manhattan/Fifth Avenue for $33 million, indicating the company's ongoing capital recycling amid rising cost pressures.
- Financial Metrics: The transaction implies a 6.3x multiple on projected 2025 hotel adjusted EBITDA and a capitalization rate of 13.3%, reflecting the asset's profitability and market appeal.
- Investment Challenges: Although the hotel's net operating income more than doubled from 2019 to 2025, upcoming investment requirements and structural expense headwinds have diminished its attractiveness relative to internal return thresholds.
- Outlook: DiamondRock has raised its 2026 RevPAR outlook to 1.5%-3.5% and guided adjusted EBITDA between $296 million and $308 million, demonstrating the company's confidence in future growth.
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Analyst Views on DRH
Wall Street analysts forecast DRH stock price to fall
11 Analyst Rating
5 Buy
6 Hold
0 Sell
Moderate Buy
Current: 10.470
Low
9.00
Averages
10.28
High
12.00
Current: 10.470
Low
9.00
Averages
10.28
High
12.00
About DRH
DiamondRock Hospitality Company is a self-advised real estate investment trust (REIT). The Company owns a portfolio of geographically diversified hotels concentrated in leisure destinations and gateway markets. Its hotels are owned by subsidiaries of its operating partnership, DiamondRock Hospitality Limited Partnership. Its primary business is to acquire, own, renovate and asset manage hotel properties in the United States. The Company's hotel properties include Chico Hot Springs Resort, Lake Austin Spa Resort, Kimpton Shorebreak Fort Lauderdale Beach Resort, Tranquility Bay, Bourbon Orleans Hotel, Henderson Beach Resort, Henderson Park Inn, Cavallo Point, Kimpton Palomar Phoenix, L'auberge De Sedona, Orchards Inn, Westin San Diego, and Havana Cabana, among others. It owns over 36 hotels and resorts with approximately 9,600 rooms. The Company has positioned its portfolio to be operated both under global brand families as well as independent boutique hotels in the lifestyle segment.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
DiamondRock Hospitality Sells New York Hotel for $33 Million
- Hotel Sale Transaction: DiamondRock Hospitality Company sold its leasehold interest in the 189-room Courtyard by Marriott in New York for $33 million, representing a 6.3x multiple on 2025 Hotel Adjusted EBITDA, showcasing the asset management team's value creation capabilities.
- Capital Expenditure Impact: The transaction includes $12 million in capital expenditures required over the next 12 months, with an estimated stabilized capitalization rate of approximately 7.8%, indicating the company's prudent capital allocation strategy in the face of structural expense pressures.
- Performance Guidance Adjustment: The company revised its full-year 2026 guidance, projecting a $5.9 million decrease in Adjusted EBITDA to a range of $290.2 to $302.2 million, reflecting the direct impact of the hotel sale on overall financial performance.
- Commitment to Shareholder Value: CEO Jeffrey J. Donnelly stated that this transaction reflects the company's ongoing commitment to enhancing free cash flow per share, aimed at creating long-term value for shareholders.
See More
DiamondRock Hospitality Sells New York Hotel for $33 Million
- Hotel Sale Transaction: DiamondRock Hospitality Company sold its leasehold interest in the 189-room Courtyard by Marriott in New York for $33 million, representing a 6.3x multiple on 2025 Hotel Adjusted EBITDA, showcasing the company's success in asset management.
- Capital Expenditure Impact: The transaction includes $12 million in capital expenditures required over the next 12 months, with an estimated stabilized capitalization rate of approximately 7.8%, which will influence the company's long-term financial performance and investment decisions.
- Revenue Guidance Adjustment: The company revised its full-year 2026 revenue guidance, with Adjusted EBITDA expected to decrease from $296 million to $308 million down to a range of $290.2 million to $302.2 million, reflecting the impact of the hotel sale on overall financials.
- Commitment to Shareholder Value: CEO Jeffrey J. Donnelly stated that this transaction reflects the company's disciplined capital allocation strategy aimed at enhancing free cash flow per share, thereby creating greater value for shareholders.
See More
DiamondRock Sells Manhattan Hotel Asset for $33M
- Asset Sale: DiamondRock Hospitality announced on Monday the sale of its leasehold interest in the 189-room Courtyard by Marriott New York Manhattan/Fifth Avenue for $33 million, indicating the company's ongoing capital recycling amid rising cost pressures.
- Financial Metrics: The transaction implies a 6.3x multiple on projected 2025 hotel adjusted EBITDA and a capitalization rate of 13.3%, reflecting the asset's profitability and market appeal.
- Investment Challenges: Although the hotel's net operating income more than doubled from 2019 to 2025, upcoming investment requirements and structural expense headwinds have diminished its attractiveness relative to internal return thresholds.
- Outlook: DiamondRock has raised its 2026 RevPAR outlook to 1.5%-3.5% and guided adjusted EBITDA between $296 million and $308 million, demonstrating the company's confidence in future growth.
See More
DiamondRock Hospitality Exceeds Q1 2026 Earnings Expectations
- Strong Financial Performance: DiamondRock Hospitality reported a 2% increase in comparable RevPAR and an adjusted EBITDA of $60.6 million for Q1, demonstrating resilience and competitiveness despite facing disruptive weather challenges in several markets.
- Strategic Leadership Changes: The company welcomed new Chairman Bruce Wardinski while celebrating the retirement of Bill McCarten, indicating proactive governance adjustments aimed at enhancing strategic development and decision-making efficiency.
- Optimistic Outlook: Management raised the 2026 RevPAR guidance to 1.5% to 3.5% and projected adjusted EBITDA between $296 million and $308 million, reflecting confidence in future market performance, particularly with favorable insurance renewal outcomes.
- Asset Sale and Share Repurchase: The company is under contract to sell one hotel, expected to close in Q2, with proceeds potentially allocated for opportunistic share repurchases, highlighting a strong focus on capital allocation and shareholder value enhancement.
See More
DiamondRock Hospitality to Announce Q1 Earnings on April 30
- Earnings Announcement: DiamondRock Hospitality (DRH) is set to announce its Q1 2023 earnings on April 30 after market close, with investors keenly awaiting the results to gauge future growth potential.
- Earnings Expectations: The consensus EPS estimate stands at $0.19, reflecting a cautious investor sentiment as EPS estimates have seen two downward revisions over the past three months, indicating potential challenges in profitability.
- Revenue Forecast Changes: The consensus revenue estimate is $257.01 million, with three upward revisions and five downward revisions in the last three months, highlighting market divergence regarding the company's revenue growth outlook.
- Market Analysis Focus: As the earnings report approaches, Seeking Alpha's quant ratings have ranked DiamondRock Hospitality among mid-cap REIT stocks, emphasizing investor interest in the company's future performance amid the earnings season.
See More
DiamondRock Wins 2026 Leader in the Light Award for Transparency
- Transparency Award: DiamondRock Hospitality Company has been honored with the 2026 Leader in the Light Award from Nareit in the Transparency category, marking the 20th year of this award, which recognizes leadership in responsible business practices and the company's positive impact within the REIT industry.
- GRESB Perfect Score: The company achieved a perfect score in GRESB's Public Disclosure Assessment for 2025, ranking first among its hotel peers in the Americas, further solidifying its leadership in environmental, social, and governance (ESG) practices.
- CEO's Commitment: CEO Jeffrey J. Donnelly stated that this recognition reflects the company's commitment to disciplined reporting and strong governance, emphasizing that transparency is foundational to maintaining investor confidence and ensuring long-term operational sustainability.
- Diverse Hotel Portfolio: DiamondRock currently owns 35 premium hotels and resorts with approximately 9,600 rooms, strategically positioning its portfolio to operate under leading global brands as well as independent boutique hotels, enhancing its competitiveness in leisure destinations and key gateway markets.
See More
DiamondRock Hospitality Sells New York Hotel for $33 Million
- Hotel Sale Transaction: DiamondRock Hospitality Company sold its leasehold interest in the 189-room Courtyard by Marriott in New York for $33 million, representing a 6.3x multiple on 2025 Hotel Adjusted EBITDA, showcasing the asset management team's value creation capabilities.
- Capital Expenditure Impact: The transaction includes $12 million in capital expenditures required over the next 12 months, with an estimated stabilized capitalization rate of approximately 7.8%, indicating the company's prudent capital allocation strategy in the face of structural expense pressures.
- Performance Guidance Adjustment: The company revised its full-year 2026 guidance, projecting a $5.9 million decrease in Adjusted EBITDA to a range of $290.2 to $302.2 million, reflecting the direct impact of the hotel sale on overall financial performance.
- Commitment to Shareholder Value: CEO Jeffrey J. Donnelly stated that this transaction reflects the company's ongoing commitment to enhancing free cash flow per share, aimed at creating long-term value for shareholders.
See More
DiamondRock Hospitality Sells New York Hotel for $33 Million
- Hotel Sale Transaction: DiamondRock Hospitality Company sold its leasehold interest in the 189-room Courtyard by Marriott in New York for $33 million, representing a 6.3x multiple on 2025 Hotel Adjusted EBITDA, showcasing the company's success in asset management.
- Capital Expenditure Impact: The transaction includes $12 million in capital expenditures required over the next 12 months, with an estimated stabilized capitalization rate of approximately 7.8%, which will influence the company's long-term financial performance and investment decisions.
- Revenue Guidance Adjustment: The company revised its full-year 2026 revenue guidance, with Adjusted EBITDA expected to decrease from $296 million to $308 million down to a range of $290.2 million to $302.2 million, reflecting the impact of the hotel sale on overall financials.
- Commitment to Shareholder Value: CEO Jeffrey J. Donnelly stated that this transaction reflects the company's disciplined capital allocation strategy aimed at enhancing free cash flow per share, thereby creating greater value for shareholders.
See More
DiamondRock Sells Manhattan Hotel Asset for $33M
- Asset Sale: DiamondRock Hospitality announced on Monday the sale of its leasehold interest in the 189-room Courtyard by Marriott New York Manhattan/Fifth Avenue for $33 million, indicating the company's ongoing capital recycling amid rising cost pressures.
- Financial Metrics: The transaction implies a 6.3x multiple on projected 2025 hotel adjusted EBITDA and a capitalization rate of 13.3%, reflecting the asset's profitability and market appeal.
- Investment Challenges: Although the hotel's net operating income more than doubled from 2019 to 2025, upcoming investment requirements and structural expense headwinds have diminished its attractiveness relative to internal return thresholds.
- Outlook: DiamondRock has raised its 2026 RevPAR outlook to 1.5%-3.5% and guided adjusted EBITDA between $296 million and $308 million, demonstrating the company's confidence in future growth.
See More
DiamondRock Hospitality Exceeds Q1 2026 Earnings Expectations
- Strong Financial Performance: DiamondRock Hospitality reported a 2% increase in comparable RevPAR and an adjusted EBITDA of $60.6 million for Q1, demonstrating resilience and competitiveness despite facing disruptive weather challenges in several markets.
- Strategic Leadership Changes: The company welcomed new Chairman Bruce Wardinski while celebrating the retirement of Bill McCarten, indicating proactive governance adjustments aimed at enhancing strategic development and decision-making efficiency.
- Optimistic Outlook: Management raised the 2026 RevPAR guidance to 1.5% to 3.5% and projected adjusted EBITDA between $296 million and $308 million, reflecting confidence in future market performance, particularly with favorable insurance renewal outcomes.
- Asset Sale and Share Repurchase: The company is under contract to sell one hotel, expected to close in Q2, with proceeds potentially allocated for opportunistic share repurchases, highlighting a strong focus on capital allocation and shareholder value enhancement.
See More
DiamondRock Hospitality to Announce Q1 Earnings on April 30
- Earnings Announcement: DiamondRock Hospitality (DRH) is set to announce its Q1 2023 earnings on April 30 after market close, with investors keenly awaiting the results to gauge future growth potential.
- Earnings Expectations: The consensus EPS estimate stands at $0.19, reflecting a cautious investor sentiment as EPS estimates have seen two downward revisions over the past three months, indicating potential challenges in profitability.
- Revenue Forecast Changes: The consensus revenue estimate is $257.01 million, with three upward revisions and five downward revisions in the last three months, highlighting market divergence regarding the company's revenue growth outlook.
- Market Analysis Focus: As the earnings report approaches, Seeking Alpha's quant ratings have ranked DiamondRock Hospitality among mid-cap REIT stocks, emphasizing investor interest in the company's future performance amid the earnings season.
See More
DiamondRock Wins 2026 Leader in the Light Award for Transparency
- Transparency Award: DiamondRock Hospitality Company has been honored with the 2026 Leader in the Light Award from Nareit in the Transparency category, marking the 20th year of this award, which recognizes leadership in responsible business practices and the company's positive impact within the REIT industry.
- GRESB Perfect Score: The company achieved a perfect score in GRESB's Public Disclosure Assessment for 2025, ranking first among its hotel peers in the Americas, further solidifying its leadership in environmental, social, and governance (ESG) practices.
- CEO's Commitment: CEO Jeffrey J. Donnelly stated that this recognition reflects the company's commitment to disciplined reporting and strong governance, emphasizing that transparency is foundational to maintaining investor confidence and ensuring long-term operational sustainability.
- Diverse Hotel Portfolio: DiamondRock currently owns 35 premium hotels and resorts with approximately 9,600 rooms, strategically positioning its portfolio to operate under leading global brands as well as independent boutique hotels, enhancing its competitiveness in leisure destinations and key gateway markets.
See More
