Food and beverage revenue at Sunstone Hotel Investors climbed to $68.6 million in the third quarter of 2026, up from $64.4 million in the same period a year earlier, as the lodging REIT's 13-hotel portfolio delivered results that exceeded management's own expectations across every major operating metric.

Portfolio-wide RevPAR rose 11.4% year-over-year to $235.22, with average daily rate reaching $323.55 and occupancy hitting 72.7%. Total RevPAR — which captures room, food and beverage, and ancillary revenue streams — grew 10.5% to $394.97, a figure that signals sustained strength in on-property guest spending beyond the guest room itself. For hospitality operators tracking full-service hotel food and beverage performance, that incremental 160-basis-point spread between RevPAR and Total RevPAR growth reflects diners and event groups contributing meaningfully to per-available-room yield.

Margins and Capital Moves

Hotel Adjusted EBITDAre margin, excluding the Andaz Miami Beach (which is still cycling through post-renovation comparisons), expanded 50 basis points to 26.7%. The company noted that if the Hilton Key West Resort & Marina — under renovation during the quarter — and certain one-time items are also excluded, margins would have expanded approximately 200 basis points. Adjusted EBITDAre for the quarter reached $54.5 million, an 8.8% increase, while Adjusted FFO per diluted share rose 17.6% to $0.20. For the nine months ended September 30, food and beverage revenue totaled $221.8 million, compared with $209.6 million in the prior-year period — a year-to-date gain of roughly $12 million that underscores the category's durability across seasons.

Sunstone deployed capital offensively during the quarter, repurchasing $117.8 million of common and preferred stock. Year-to-date through November 5, the company had allocated $196.9 million to buybacks, funded in part by asset sales including the Hyatt Regency San Francisco, which closed in July 2026. The strategy — realizing private-market asset values and redeploying proceeds at a discount to net asset value — directly boosted per-share earnings metrics, a playbook that hospitality REIT operators and their lenders are watching closely as lodging investment activity remains selective.

Raised Outlook and What's Ahead

Management raised its full-year 2026 guidance across all key metrics. Full-year RevPAR growth is now projected at 9.5% to 10.5%, up from a prior range of 7.0% to 9.0%. Adjusted EBITDAre is expected to land between $254 million and $259 million, up from the prior midpoint of $250 million. Adjusted FFO per diluted share guidance moved to $1.00–$1.03, versus the prior $0.93–$0.98 range. The company also flagged encouraging forward signals: robust group booking pace, continued market recovery at select properties, and additional earnings contribution from recent investment activity. CEO Bryan A. Giglia cited "broad-based strength across demand segments" as the key driver, pointing to Andaz Miami Beach's post-renovation contribution — expected to add approximately 450 basis points of full-year RevPAR growth on its own — as a near-term tailwind.

Sunstone ended Q3 with $817.9 million in total liquidity, including $317.9 million in cash and equivalents and full availability on its $500 million revolving credit facility. Total debt stood at $955.0 million with no maturities until January 2028, giving the company flexibility to continue investing in its portfolio — including an estimated $105 million to $115 million in full-year capital expenditures focused on renovations at Hilton Key West Resort & Marina, storm-related restoration at Wailea Beach Resort, and the completed meeting-space upgrade at Hilton San Diego Bayfront.

Written by Michael Politz, Author of Guide to Restaurant Success: The Proven Process for Starting Any Restaurant Business From Scratch to Success (ISBN: 978-1-119-66896-1), Founder of Food & Beverage Magazine, the leading online magazine and resource in the industry. Designer of the Bluetooth logo and recognized in Entrepreneur Magazine's "Top 40 Under 40" for founding American Wholesale Floral, Politz is also the Co-founder of the Proof Awards and the CPG Awards and a partner in numerous consumer brands across the food and beverage sector.