Sotherly Hotels Reports $48.3 Million Revenue and $4.7 Million Net Income in Q1 2025

Sotherly Hotels Inc. reported a total revenue of approximately $48.3 million for the first quarter of 2025, marking a 3.8% increase from $46.5 million in the same period of 2024. The growth was primarily driven by a 5.2% rise in room revenue, which reached $31.3 million, attributed to a 3.9% increase in occupancy rates across its hotel portfolio. The company also noted a 4.1% increase in food and beverage revenue, totaling approximately $10.2 million, while revenue from other operating departments decreased slightly to $6.9 million.

In terms of profitability, Sotherly Hotels reported a net income of approximately $4.7 million for the quarter, a significant increase from $1.3 million in the prior year. This improvement was bolstered by a gain of approximately $3.9 million from the involuntary conversion of assets related to damage from Hurricane Helene. The company’s net income attributable to common stockholders was approximately $2.7 million, translating to a basic and diluted earnings per share of $0.13, compared to a loss of $0.03 per share in the previous year.

Operationally, Sotherly Hotels managed ten hotel properties, comprising 2,786 rooms, as of March 31, 2025. The company has continued to focus on enhancing its portfolio, with significant investments in capital expenditures for property improvements. For the quarter, hotel operating expenses increased by 3.5% to approximately $35.4 million, reflecting higher costs associated with increased occupancy and food and beverage sales. The company maintained a strong cash position, with approximately $11.5 million in cash and $21.3 million in restricted cash.

Strategically, Sotherly Hotels has been active in securing financing to support its operations and growth initiatives. In February 2024, the company secured a $35 million mortgage loan for the Hotel Alba in Tampa, Florida, and amended existing loans to extend maturities and fund renovations. The company is also preparing for upcoming mortgage maturities, including those for the Georgian Terrace and DoubleTree Resort by Hilton Hollywood Beach, and is exploring options for refinancing or extending these loans.

Looking ahead, Sotherly Hotels remains optimistic about its operational performance, driven by increasing demand for hotel accommodations and ongoing improvements to its properties. However, the company acknowledges potential risks, including economic conditions and competition in the hotel industry, which could impact future performance. The management is committed to maintaining a flexible capital structure to support its growth and operational needs while navigating the challenges of the hospitality market.