Sunstone Hotel Investors (SHO) investor relations material

Executive summary

• Q2 2026 performance exceeded expectations, with net income attributable to common stockholders rising to $26.0 million and RevPAR up 9.3% year-over-year, driven by robust leisure, group, and corporate demand, and the reopening of Andaz Miami Beach.

• Adjusted EBITDAre for Q2 was $77 million (+6% YoY), and Adjusted FFO per diluted share reached $0.32 (+14% YoY).

• Sale of Hyatt Regency San Francisco for $279 million at a nearly 20x trailing EBITDA multiple provided capital for accretive stock repurchases and debt repayment.

• Resorts, especially Wailea Beach Resort and Andaz Miami Beach, led portfolio growth, while urban and convention hotels also saw strong demand.

• Repurchased $70 million in common and preferred stock YTD, accretive to NAV and EPS.

Financial highlights

• Q2 2026 total revenues were $277.1 million (+6.7% YoY), with net income of $26.0 million (+141.6% YoY) and Adjusted EBITDAre of $77 million (+6% YoY).

• Adjusted FFO per diluted share was $0.32 (+14% YoY); six-month Adjusted FFO was $109.2 million (+12.3% YoY).

• Portfolio RevPAR grew 9.3% (4.3% excluding Andaz Miami Beach); ADR was $339.71 and occupancy 77.6%.

• Cash and cash equivalents post-sale were ~$430 million; total debt was $955 million.

• Net leverage at 2.6x trailing earnings (3.6x including preferred equity); no debt maturities before 2028.

Outlook and guidance

• Full-year 2026 guidance raised: net income expected at $79–$89 million, Adjusted EBITDAre at $245–$255 million, and Adjusted FFO per diluted share at $0.93–$0.98.

• RevPAR and Total RevPAR growth forecasted at 7.0%–9.0% year-over-year, with Andaz Miami Beach contributing 450 basis points.

• Capital expenditures for 2026 projected at $105–$115 million, mainly for Wailea Beach Resort storm repairs.

• Guidance reflects asset sales, Q2 outperformance, and lower G&A from management transition.

• Full-year interest expense expected at $49–$52 million; preferred dividends at $15–$16 million.