HOST HOTELS & RESORTS L.P.

Previous wording

In this quarterly report on Form 10-Q, we make forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are identified by their use of terms and phrases such as “anticipate,” “believe,” “could,” “expect,” “may,” “intend,” “predict,” “project,” “plan,” “will,” “estimate” and other similar terms and phrases, including references to assumptions and forecasts of future results. Forward-looking statements are based on management’s current expectations and assumptions and are not guarantees of future performance. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results to differ materially from those anticipated at the time the forward-looking statements are made.

Current wording

In this quarterly report on Form 10-Q, we make forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are identified by their use of terms and phrases such as “anticipate,” “believe,” “could,” “expect,” “may,” “intend,” “predict,” “project,” “plan,” “will,” “estimate” and other similar terms and phrases, including references to assumptions and forecasts of future results. Forward-looking statements are based on management’s current expectations and assumptions and are not guarantees of future performance. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results to differ materially from those anticipated at the time the forward-looking statements are made.

Previous wording

•risks that U.S. immigration policies and border closings, visa processing times, travel restrictions or advisories, changes in energy prices or changes in foreign exchange rates will suppress international travel to the United States generally or decrease the labor pool, and risks that international U.S. outbound travel may remain elevated relative to historic levels;

Current wording

•risks that U.S. immigration policies and border closings, visa processing times, travel restrictions or advisories, changes in energy prices or changes in foreign exchange rates will continue to suppress international travel to the United States generally or decrease the labor pool, and risks that the current travel imbalance (i.e., elevated international U.S. outbound travel combined with a decrease in inbound travel to the U.S.) may remain elevated relative to historic levels;

Previous wording

•future U.S. governmental action to address budget deficits through reductions in spending and similar austerity measures, as well as the impact of potential U.S. government shutdowns, all of which could materially adversely affect U.S. economic conditions, business activity, credit availability and borrowing costs;

Current wording

•future U.S. governmental action to address budget deficits through reductions in spending and similar austerity measures, as well as the impact of the U.S. government shutdown which began on October 1, 2025, all of which could materially adversely affect U.S. economic conditions, business activity, credit availability and borrowing costs (see also Part II, Item 1A. for further information on the risks relating to the U.S. federal government shutdown);

Previous wording

(1)EBITDAre, Adjusted EBITDAre, NAREIT FFO per diluted share and Adjusted FFO per diluted share and comparable hotel operating results (including hotel revenues and hotel EBITDA and margins) are non-GAAP financial measures within the meaning of the rules of the SEC. See “Non-GAAP Financial Measures” and "Comparable Hotel Operating Statistics and Results" for more information on these measures, including why we believe these supplemental measures are useful, reconciliations to the most directly comparable GAAP measure, and the limitations on the use of these supplemental measures. Additionally, comparable hotel results and statistics are based on 78 comparable hotels as of June 30, 2025 and include adjustments for non-comparable hotels, dispositions and acquisitions. See Comparable Hotel RevPAR Overview for results of the portfolio based on our ownership period, without these adjustments.

Current wording

(1)EBITDAre, Adjusted EBITDAre, NAREIT FFO per diluted share and Adjusted FFO per diluted share and comparable hotel operating results (including hotel revenues and hotel EBITDA and margins) are non-GAAP financial measures within the meaning of the rules of the SEC. See “Non-GAAP Financial Measures” and "Comparable Hotel Operating Statistics and Results" for more information on these measures, including why we believe these supplemental measures are useful, reconciliations to the most directly comparable GAAP measure, and the limitations on the use of these supplemental measures. Additionally, comparable hotel results and statistics are based on 76 comparable hotels as of September 30, 2025 and include adjustments for non-comparable hotels, dispositions and acquisitions. See Comparable Hotel RevPAR Overview for results of the portfolio based on our ownership period, without these adjustments.

Previous wording

Total revenues increased $120 million, or 8.2%, and $243 million, or 8.3%, for the second quarter and year-to-date 2025, respectively, as compared to 2024. The improvements for the quarter were driven by a 3.7% increase in room rates at our comparable hotels, primarily due to strong transient demand, coupled with increases in food and beverage revenues and ancillary spend. Second quarter and year-to-date total revenues also benefited from the 2024 acquisitions of the 1 Hotel Nashville and Embassy Suites by Hilton Nashville Downtown, 1 Hotel Central Park and The Ritz-Carlton O'ahu, Turtle Bay (collectively, the "2024 Acquisitions"). Comparable hotel RevPAR increased 3.0% and 5.0% for the quarter and year-to-date 2025, respectively, primarily due to the increase in room rates and strong transient demand, along with the continuing recovery in Maui, which more than offset a decline in group demand due to planned renovation disruption and business mix shifting from group to transient in Maui.

Current wording

Total revenues increased $12 million, or 0.9%, and $255 million, or 6.0%, for the third quarter and year-to-date 2025, respectively, as compared to 2024. For the quarter, growth was moderate as continued strength in transient rates was mostly offset by weakness in group demand. Year-to-date, strong short-term transient demand has driven the RevPAR gains, while we continue to see increased out-of-room spend driving food and beverage and other revenues. The third quarter and year-to-date total revenues also benefited from the 2024 acquisitions of the 1 Hotel Nashville and Embassy Suites by Hilton Nashville Downtown, 1 Hotel Central Park and The Ritz-Carlton O'ahu, Turtle Bay (collectively, the "2024 Acquisitions"), partially offset by the 2025 dispositions of The Westin Cincinnati and Washington Marriott at Metro Center (collectively, the "2025 Dispositions"). Comparable hotel RevPAR increased 0.2% and 3.5% for the quarter and year-to-date 2025, respectively, primarily due to the increase in room rates and strong transient demand, along with the continuing recovery in Maui, which collectively offset a decline in group demand due to difficult comparisons to prior year due to the timing of holidays and planned renovation disruption.

Previous wording

Comparable hotel Total RevPAR increased 4.2% for the second quarter 2025 compared to 2024, due primarily to the rate increases and improvements in food and beverage revenues driven by strength in transient business. Comparable hotel Total RevPAR increased 5.0% for year-to-date 2025 compared to 2024. For the quarter, the growth was led by our Atlanta, Maui, Miami and San Francisco/San Jose markets with increases of 20.8%, 18.5%, 16.4% and 15.7%, respectively, compared to the second quarter of 2024 , driven by rate growth and strong transient demand. The San Francisco/San Jose market benefited from an improved citywide events calendar and Maui continued its recovery from the wildfires. These strong performances were partially offset by comparable hotel Total RevPAR declines in our Austin and Washington, D.C. (CBD) markets of 34.6% and 11.0%, respectively. Both markets were impacted by large-scale renovation projects at certain properties, while Austin was further impacted by the beginning of the multi-year closure of the city's convention center.

Current wording

Comparable hotel Total RevPAR increased 0.8% and 3.7% for the third quarter and year-to-date of 2025, respectively, compared to 2024. For the quarter, the growth was led by our Atlanta, Maui and Oahu markets, with increases of 20.1%, 18.6% and 10.4%, respectively, compared to the third quarter of 2024. The outperformance in Atlanta compared to last year is primarily due to the completion of planned renovations that impacted the results in 2024, while Oahu saw increases in both rate and occupancy driven by strong group bookings, and Maui continued its recovery from the wildfires. These strong performances were partially offset by comparable hotel Total RevPAR declines in our Austin and New Orleans markets of 30.5% and 16.4%, respectively. Both markets were impacted by large-scale renovation projects at certain properties, while Austin was further impacted by the multi-year closure of the city's convention center that started earlier in 2025. At some of our larger markets, comparable hotel Total RevPAR increases in New York and San Francisco of 9.1% and 8.6%, respectively, due to strong citywides and transient demand, offset decreases in our Washington, D.C. and San Diego markets, of 12.9% and 9.9%, respectively, with both markets affected by large-scale renovation projects at certain properties.

Previous wording

For the second quarter and year-to-date 2025, operating profit margin under GAAP was 17.5% and 17.7%, respectively, a decline of 240 basis points and 220 basis points compared to 2024, primarily due to a $47 million and $68 million decrease in net gains on insurance settlements recognized during the quarter and year-to-date, respectively. Comparable hotel EBITDA margin was 31.0% and 31.4%, for the second quarter and year-to-date 2025, respectively, a decline of 120 basis points and 50 basis points, due to a decrease in net gains on insurance settlements for comparable hotels of $21 million for both periods, while increases in room rates were able to offset an increase in wages expense.

Current wording

For the third quarter and year-to-date 2025, operating profit margin under GAAP was 7.6% and 14.7%, respectively, a decline of 260 basis points and 220 basis points compared to the same periods in 2024, primarily due to a $24 million and $92 million decrease in net gains on insurance settlements recognized during the quarter and year-to-date, respectively. Comparable hotel EBITDA margin was 23.9% and 29.2%, for the third quarter and year-to-date 2025, respectively, a decline of 50 basis points and 40 basis points. Both the third quarter and year-to-date 2025 were affected by an increase in wages expense. Year-to-date growth in room rates was able to offset those increases, but was further affected by a decrease in net gains on insurance settlements for comparable hotels of $21 million.

Previous wording

Net income decreased $17 million and $38 million for the quarter and year-to-date 2025, respectively, as recent acquisitions, improvements in operating results and a $21 million gain on asset sales were offset by the declines in net gains on insurance settlements noted above and increases in depreciation, interest expense, and income taxes. These changes led to a decrease in diluted earnings per share of $0.02, or 5.9%, and $0.05, or 6.9%, for the quarter and year-to-date, respectively. Adjusted EBITDAre, which excludes gain on property insurance, gain on asset sale, depreciation, interest expense and taxes, increased $15 million and $40 million for the second quarter and year-to-date, respectively, as improvements in operations and earnings from our 2024 Acquisitions more than offset a decline in business interruption proceeds and wage increases. Adjusted FFO per diluted share increased $0.01, or 1.8%, for the quarter and increased $0.02, or 1.7%, for year-to-date, reflecting the changes in Adjusted EBITDAre partially offset by increases in interest expense and income taxes which are included in Adjusted FFO per diluted share but not Adjusted EBITDAre.

Current wording

Net income increased $79 million and $41 million for the quarter and year-to-date 2025, respectively, as recent acquisitions, improvements in operating results and a $122 million gain on asset sales in the third quarter offset the declines in net gains on insurance settlements noted above and increases in interest expense and income taxes. These changes led to an increase in diluted earnings per share of $0.11, or 91.7%, and $0.07, or 8.3%, for the quarter and year-to-date, respectively. Adjusted EBITDAre, which excludes gain on property insurance, gain on asset sale, depreciation, interest expense and taxes, decreased $11 million for the third quarter and increased $29 million year-to-date. For the quarter, improvements in revenues were offset by wage increases, while year-to-date exceeded 2024 as stronger improvements in room rates and earnings from the 2024 Acquisitions more than offset the decline in business interruption proceeds and wage increases. Adjusted FFO per diluted share decreased $0.01, or 2.8%, for the quarter and increased $0.01, or 0.6%, year-to-date, reflecting the changes in Adjusted EBITDAre, further reduced by increases in interest expense and income taxes, which are included in Adjusted FFO per diluted share but not Adjusted EBITDAre.

Previous wording

During the first half of 2025, strong leisure transient demand has led to year-over-year comparable hotel RevPAR improvement of 5.0%. Results reflect the improving leisure demand on Maui and an increase in transient revenue driven by higher average rates, particularly at our resorts. Overall, year-to-date results have not reflected material impacts from recent economic policy changes; however, as anticipated, group demand declined in the second quarter due to renovation disruption and business mix shifting in Maui from group to transient.

Current wording

During year-to-date 2025, strong leisure transient demand has led to year-over-year comparable hotel RevPAR improvement of 3.5%. Results reflect the improving leisure demand on Maui and an increase in transient revenue driven by higher average rates, particularly at our resorts. Overall, year-to-date results have not reflected material impacts from recent economic policy changes, including heightened tariffs; however, as anticipated, group demand declined in the third quarter primarily due to renovation disruption and a shift in the timing of holidays.

Previous wording

For the remainder of the year, we expect that demand will continue to be driven by transient business, as we anticipate continued softness in short-term group bookings due to persistent uncertainty surrounding trade and economic policy. Additionally, international inbound travel continues to face headwinds from shifting global travel patterns, as evolving trade and immigration policy tempers inbound demand, while outbound travel remains elevated. Other risks to economic growth remain, including high interest rates, geopolitical instability, and labor market conditions that, while generally stable, are loosening as both labor participation and hiring momentum soften. As a result, U.S. GDP growth consensus expectations remain at 1.4% for 2025, representing a slowdown from 2.8% growth in 2024, with forecasts for the second half of the year remaining cautious.

Current wording

For the fourth quarter, we expect that demand will continue to be driven by transient business, as we anticipate continued softness in short-term group bookings due to persistent uncertainty surrounding trade and U.S. economic policy. Additionally, international inbound travel continues to face headwinds from shifting global travel patterns, as evolving trade and immigration policy tempers inbound demand, while outbound travel remains elevated. Broader risks to economic growth remain, including the economic effects of the ongoing government shutdown that began on October 1, 2025, high interest rates, geopolitical instability, and a labor market that, while not deteriorating sharply, appears increasingly stagnant as both labor participation and hiring momentum plateau. Despite these pressures, U.S. GDP growth consensus expectations for 2025 have been revised up to 1.9%, reflecting resilience in consumer spending and tech-driven investment. Nonetheless, this still represents a slowdown from 2.8% growth in 2024, and the outlook for the final quarter of 2025 remains cautious.

Previous wording

Based on the trends noted, we expect comparable hotel RevPAR growth for the full year 2025 will be between 1.5% and 2.5%, reflecting an expected decline in comparable hotel RevPAR in the third quarter year-over-year and modest growth in the fourth quarter. The forecast assumes continued recovery at our Maui properties; however, the timing of Maui's full recovery remains uncertain. In addition, we continue to expect margins to decline in comparison to 2024, driven by higher wages and benefits, including increases driven by new union contracts in certain cities.

Current wording

Based on the trends noted, we expect comparable hotel RevPAR growth for the full year 2025 will be approximately 3.0%, reflecting modest growth in the fourth quarter and the assumption of limited impacts from the government shutdown, which are comparable to what was experienced in October. In addition, we continue to expect margins to decline in comparison to 2024, driven by higher wages and benefits, including increases driven by new union contracts in certain cities.

Previous wording

Capital Projects. Through the second quarter of 2025, we spent approximately $109 million on return on investment ("ROI") capital projects, $129 million on renewal and replacement projects, and $60 million on hurricane and other restoration work. This included our continuing restoration efforts at The Don CeSar following Hurricanes Helene and Milton, for which we estimate the total property reconstruction and remediation costs, including resiliency enhancements, to be approximately $100 million to $105 million of which approximately 30% relates to remediation costs. The Don CeSar reopened to guests on March 26, 2025, as part of a phased reopening, with the remaining amenities expected to re-open later this year. As of June 30, 2025, we have received total insurance proceeds of $29 million related to our claims, of which $19 million has been recognized as business interruption proceeds, including $9 million in the second quarter of 2025. Subsequent to quarter end, we received an additional $10 million of insurance proceeds, of which $5 million related to business interruption.

Current wording

Capital Projects. Through the third quarter of 2025, we spent approximately $184 million on return on investment ("ROI") capital projects, $200 million on renewal and replacement projects, and $70 million on hurricane and other restoration work. This included our restoration efforts at The Don CeSar following Hurricanes Helene and Milton, for which we estimate the total property reconstruction and remediation costs, including resiliency enhancements, to be approximately $105 million, of which approximately 30% relates to remediation costs. The Don CeSar reopened to guests on March 26, 2025, as part of a phased reopening, with the final amenities reopened during the third quarter. As of September 30, 2025, we have received total insurance proceeds of $40 million related to our claims, of which $24 million has been recognized as business interruption proceeds, including $5 million in the third quarter of 2025.

Previous wording

In collaboration with Hyatt, we initiated a transformational capital program in 2023 on six properties in our portfolio. These investments are intended to position the targeted hotels to compete better in their respective markets while seeking to enhance long-term performance. We expect to invest approximately $125 million to $200 million per year on this program through 2027. Hyatt has agreed to provide additional priority returns on the agreed upon investments and operating profit guarantees totaling $40 million to offset expected business disruptions. Approximately 53% of the total estimated costs of the program have been spent as of June 30, 2025, and we spent approximately $54 million year-to-date 2025, which is included in ROI capital projects.

Current wording

In collaboration with Hyatt, we initiated a transformational capital program in 2023 on six properties in our portfolio. These investments are intended to position the targeted hotels to compete better in their respective markets while seeking to enhance long-term performance. We expect to invest approximately $125 million to $200 million per year on this program through 2027. Hyatt has agreed to provide additional priority returns on the agreed upon investments and operating profit guarantees totaling $40 million to offset expected business disruptions. Approximately 65% of the total estimated costs of the program have been spent as of September 30, 2025, and we spent approximately $104 million year-to-date 2025, which is included in ROI capital projects. During the third quarter of 2025, we substantially completed the transformational renovations at the Hyatt Regency Washington on Capitol Hill, including rooms, public space, and food and beverage outlets.

Previous wording

For full year 2025, we expect total capital expenditures of $590 million to $660 million, consisting of ROI projects of approximately $270 million to $305 million, renewal and replacement expenditures of $250 million to $275 million, and $70 million to $80 million for the restoration work from the damage caused by Hurricanes Helene and Milton. The full year ROI project spend includes approximately $170 million to $180 million for the Hyatt transformational capital program discussed above.

Current wording

For full year 2025, we expect total capital expenditures of $605 million to $640 million, consisting of ROI projects of approximately $280 million to $295 million, renewal and replacement expenditures of $250 million to $265 million, and $75 million to $80 million for the restoration work from the damage caused by Hurricanes Helene and Milton.

Previous wording

Construction continued on the development of 40 condominiums on a five-acre development parcel to be Four Seasons-branded and managed residences at the Four Seasons Resort Orlando at Walt Disney World® Resort. The mid-rise building is expected to be completed in the fourth quarter of 2025, and the villas are expected to be completed in the first half of 2026. Year-to-date 2025, we spent $43 million in development costs for this project and expect full year 2025 development costs for this project to be $75 million to $85 million.

Current wording

Construction continued on the development of 40 condominiums on a five-acre development parcel to be Four Seasons-branded and managed residences at the Four Seasons Resort Orlando at Walt Disney World® Resort. The mid-rise building is expected to be completed in the fourth quarter of 2025, and the villas are expected to be completed in the first half of 2026. Year-to-date 2025, we spent $67 million in development costs for this project and expect full year 2025 development costs for this project to be $80 million to $85 million.

Previous wording

Statement of Operations Results and Trends

Current wording

Statements of Operations Results and Trends

Previous wording

Total revenues for the second quarter and year-to-date increased 8.2% and 8.3%, respectively compared to 2024, due to an increase in room rates driven by strong transient demand, partially offset by a decline in group demand due to planned renovation disruption and business mix shifting from group to transient on Maui. Second quarter and year-to-date total revenues also benefited from the operations of our 2024 acquisitions, including 1 Hotel Nashville and Embassy Suites by Hilton Nashville Downtown acquired in April 2024, 1 Hotel Central Park acquired in July 2024, and The Ritz-Carlton O'ahu, Turtle Bay acquired in July 2024. The year-to-date improvements were partially offset by the closure of The Don CeSar, which closed in September 2024 due to Hurricanes Helene and Milton, and reopened to guests on March 26, 2025 as part of a phased reopening.

Current wording

Total revenues for the third quarter and year-to-date increased 0.9% and 6.0%, respectively, compared to 2024, due to an increase in room rates driven by strong transient demand and continued strength in out-of-room spend, partially offset by a decline in group demand due to planned renovation disruption. Third quarter and year-to-date total revenues also benefited from the operations of our 2024 Acquisitions. These improvements more than offset the negative impact on revenues resulting from our 2025 Dispositions and the closure of The Don CeSar from September 2024 to March 2025 due to Hurricanes Helene and Milton.

Previous wording

Rooms. Total rooms revenues increased $64 million, or 7.2%, and $149 million, or 8.6%, for the second quarter and year-to-date, respectively, compared to 2024, reflecting the operations of the 2024 Acquisitions and an increase at our comparable hotels of $27 million, or 3.0%, and $79 million, or 4.4%, for the second quarter and year-to-date, respectively, driven primarily by an increase in average room rate of 3.7% and 4.7%, respectively, and an increase in transient demand.

Current wording

Rooms. Total rooms revenues increased $1 million, or 0.1%, and $150 million, or 5.9%, for the third quarter and year-to-date, respectively, compared to 2024, reflecting the increase at our comparable hotels of $2 million, or 0.3%, and $81 million, or 3.2%, for the third quarter and year-to-date, respectively, due primarily to an increase in average room rate of 3.0% and 4.3%, respectively, driven by transient demand. For the third quarter, total rooms revenue was negatively impacted by the 2025 Dispositions (which occurred in June and August of 2025), while year-to-date benefitted from the 2024 Acquisitions.

Previous wording

Food and beverage. Total food and beverage ("F&B") revenues increased $31 million, or 6.9%, for the quarter and $61 million, or 6.6%, year-to-date, compared to 2024, due to results of the 2024 Acquisitions and an increase in comparable F&B revenues of $18 million, or 4.0%, and $36 million, or 3.9%, for the quarter and year-to-date, respectively. The increases were driven by strong outlet revenues from our resorts, specifically our Maui resorts as the recovery continues, as well as the completion of ROI projects at several restaurant locations. For the year-to-date, F&B revenue growth was also driven by contribution growth in banquet and audio-visual revenues.

Current wording

Food and beverage. Total food and beverage ("F&B") revenues decreased $1 million, or 0.3%, for the quarter and increased $60 million, or 4.7%, year-to-date, compared to 2024. The third quarter decline was due to a decrease in comparable F&B revenues of $1 million, or 0.3%, as an increase in F&B outlet revenue from strong transient demand was able to mostly offset the decline in banquet and AV revenues from lower group business. Year-to-date, F&B revenues reflect the results of the 2024 Acquisitions and an increase in comparable F&B revenues of $35 million, or 2.7%, driven by strong outlet revenues from our resorts, specifically our Maui resorts as the recovery continues, as well as the completion of ROI projects at several restaurant locations.

Previous wording

Other revenues. Total other revenues increased $25 million, or 18.7%, and $33 million, or 11.8%, for the quarter and year-to-date, respectively, compared to 2024, driven by results from the 2024 Acquisitions. Other revenues at our comparable hotels increased $18 million, or 13.1%, for the quarter and $19 million, or 6.6%, year-to-date, primarily due to an increase in spa, golf and other ancillary revenues, driven by the continued recovery on Maui, and an increase in attrition and cancellation fees during the second quarter.

Current wording

Other revenues. Total other revenues increased $12 million, or 9.3%, and $45 million, or 11.0%, for the quarter and year-to-date, respectively, compared to 2024, due to the results from the 2024 Acquisitions and the increase at our comparable hotels of $10 million, or 7.9%, and $27 million, or 6.5%, for the quarter and year-to-date, respectively. This growth was primarily due to an increase in spa, golf and other ancillary revenues, boosted by the continued recovery on Maui.

Previous wording

Our operating costs and expenses, which consist of both fixed and variable components, are affected by several factors. Rooms expenses are affected mainly by occupancy, which drives costs related to items such as housekeeping, reservation systems, room supplies, laundry services and front desk costs. Food and beverage expenses correlate closely with food and beverage revenues and are affected by occupancy and the mix of business between banquet, audio-visual and outlet sales. However, the most significant expense for the rooms, food and beverage, and other departmental and support expenses is wages and employee benefits, which comprise approximately 58% of these expenses. For both the second quarter and year-to-date of 2025, these expenses increased approximately 5.5% on a per available room basis compared to 2024, primarily due to an overall increase in general wage rates and benefits. Wage and benefit rate inflation is expected to be approximately 6% in 2025.

Current wording

Our operating costs and expenses, which consist of both fixed and variable components, are affected by several factors. Rooms expenses are affected mainly by occupancy, which drives costs related to items such as housekeeping, reservation systems, room supplies, laundry services and front desk costs. Food and beverage expenses correlate closely with food and beverage revenues and are affected by occupancy and the mix of business between banquet, audio-visual and outlet sales. However, the most significant expense for the rooms, food and beverage, and other departmental and support expenses is wages and employee benefits, which comprise approximately 58% of these expenses. These expenses increased approximately 4% and 5% on a per available room basis for the quarter and year-to-date, respectively, compared to 2024, primarily due to an overall increase in general wage rates and benefits. Wage and benefit rate inflation is expected to be approximately 6% in 2025.

Previous wording

The increase in expenses for the second quarter and year-to-date 2025 compared to 2024 for rooms, food and beverage, other departmental and support, and management fees was generally due to the corresponding increases in revenues due to the 2024 Acquisitions, and also reflected increased expenses at our comparable hotels primarily due to increased wages and benefits, as described below:

Current wording

The increase in expenses for the third quarter and year-to-date 2025 compared to 2024 for rooms, food and beverage, and other departmental and support was generally due to the corresponding increases in revenues due to the 2024 Acquisitions, and also reflected increased expenses at our comparable hotels primarily due to increased wages and benefits, as described below:

Previous wording

Rooms. Rooms expenses increased $19 million, or 8.9%, and $42 million, or 10.1%, for the quarter and year-to-date, respectively. Our comparable hotels rooms expenses increased $10 million, or 4.6%, and $23 million, or 5.4%, for the quarter and year-to-date, respectively, driven by an overall increase in wage rates.

Current wording

Rooms. Rooms expenses increased $6 million, or 2.8%, and $48 million, or 7.6%, for the quarter and year-to-date, respectively. Our comparable hotels rooms expenses increased $6 million, or 2.8%, and $29 million, or 4.6%, for the quarter and year-to-date, respectively, driven by an overall increase in wage rates.

Previous wording

Food and beverage. F&B expenses increased $27 million, or 9.4%, and $55 million, or 9.5%, for the quarter and year-to-date, respectively. For our comparable hotels, F&B expenses increased $16 million, or 5.5%, and $31 million, or 5.2%, for the quarter and year-to-date, respectively. Overall, F&B costs as a percentage of revenues increased slightly year over year as a result of increased wages and benefits.

Current wording

Food and beverage. F&B expenses increased $11 million, or 4.1%, and $66 million, or 7.8%, for the quarter and year-to-date, respectively. For our comparable hotels, F&B expenses increased $8 million, or 3.1%, and $40 million, or 4.7%, for the quarter and year-to-date, respectively. Overall, F&B costs as a percentage of revenues increased year over year as a result of increased wages and benefits.

Previous wording

Other departmental and support expenses. Other departmental and support expenses increased $32 million, or 9.3%, and $62 million, or 9.2%, for the quarter and year-to-date, respectively. On a comparable hotel basis, other departmental and support expenses increased $14 million, or 3.9%, and $25 million, or 3.6%, for the quarter and year-to-date, respectively. These increases were primarily due to higher wage expense.

Current wording

Other departmental and support expenses. Other departmental and support expenses increased $12 million, or 3.5%, and $74 million, or 7.2%, for the quarter and year-to-date, respectively. On a comparable hotel basis, other departmental and support expenses increased $9 million, or 2.8%, and $35 million, or 3.4%, for the quarter and year-to-date, respectively. These increases were primarily due to higher wage expense.

Previous wording

Management fees. Total management fees increased $1 million, or 1.4%, and $1 million, or 0.7%, for the quarter and year-to-date, respectively. Base management fees, which generally are calculated as a percentage of total revenues, increased $2 million, or 4.8%, and $5 million, or 6.0%, for the quarter and year-to-date, respectively. At our comparable hotels, base management fees increased $1 million, or 3.1%, and $3 million, or 3.7%, for the quarter and year-to-date, respectively. Incentive management fees, which generally are based on the amount of operating profit at each hotel after we receive a priority return on our investment, decreased $1 million, or 3.7%, and $4 million, or 7.3%, for the quarter and year-to-date, respectively. At our comparable hotels, incentive management fees decreased $1 million, or 3.1%, and $1 million, or 2.4%, for the quarter and year-to-date, respectively.

Current wording

Management fees. Total management fees decreased $3 million, or 5.5%, and $2 million, or 1.0%, for the quarter and year-to-date, respectively. Base management fees, which generally are calculated as a percentage of total revenues, decreased $1 million, or 2.7%, for the quarter and increased $4 million, or 3.3%, year-to-date. Incentive management fees, which generally are based on the amount of operating profit at each hotel after we receive a priority return on our investment, decreased $2 million, or 11.1%, and $6 million, or 8.2%, for the quarter and year-to-date, respectively, due to disruption from planned renovations.

Previous wording

Other property-level expenses. These expenses generally do not vary significantly based on occupancy and include expenses such as property taxes and insurance. Other property-level expenses increased $6 million, or 5.9%, and $13 million, or 6.3%, for the quarter and year-to-date, respectively, primarily due to increases in property taxes and increases due to the 2024 Acquisitions. Other property-level expenses at our comparable hotels remained flat for the quarter, and increased $3 million, or 1.2%, year-to-date. Other property-level expenses also were partially offset by the receipt of operating profit guarantees received from our managers related to the transformational capital programs in both 2025 and 2024.

Current wording

Other property-level expenses. These expenses generally do not vary significantly based on occupancy and include expenses such as property taxes and insurance. Other property-level expenses decreased $5 million, or 4.6%, for the quarter due to higher operating profit guarantees received from our hotel managers related to the transformational capital programs in 2025 as compared to 2024, reflecting the timing of projects included in the programs. Year-to-date, other property-level expenses increased $8 million, or 2.6%, primarily due to increases in property taxes and increases due to the 2024 Acquisitions. Other property-level expenses at our comparable hotels decreased $5 million, or 5.3%, and $3 million, or 1.0% for the quarter and year-to-date, respectively.

Previous wording

(1)Including the change in accrued interest, total cash interest paid was $63 million and $52 million for the quarters ended June 30, 2025 and 2024, respectively, and $119 million and $91 million year-to-date 2025 and 2024, respectively.

Current wording

(1)Including the change in accrued interest, total cash interest paid was $51 million and $40 million for the quarters ended September 30, 2025 and 2024, respectively, and $170 million and $131 million year-to-date 2025 and 2024, respectively.

Previous wording

Other gains. Other gains include the $21 million gain on sale of The Westin Cincinnati during the second quarter of 2025.

Current wording

Other gains. Other gains include the $122 million gain on sale of the Washington Marriott at Metro Center during the third quarter of 2025 and the $21 million gain on sale of The Westin Cincinnati during the second quarter of 2025.

Previous wording

Provision for income taxes. We lease substantially all our properties to consolidated subsidiaries designated as taxable REIT subsidiaries (“TRS”) for U.S. federal income tax purposes. Taxable income or loss generated/incurred by the TRS primarily represents hotel-level operations, net of the aggregate rent paid to Host L.P. by the TRS, on which we record an income tax provision or benefit. For the second quarter and year-to-date of 2025, we recorded a net income tax provision of $27 million and $26 million, respectively, primarily due to the profitability of hotel operations retained by the TRS. The increase for both the quarter and year-to-date, as compared to 2024, is also due to the recognition of federal income tax credits related to the installation of a co-generation plant at one of our properties in 2024.

Current wording

Provision for income taxes. We lease substantially all our properties to consolidated subsidiaries designated as taxable REIT subsidiaries (“TRS”) for U.S. federal income tax purposes. Taxable income or loss generated/incurred by the TRS primarily represents hotel-level operations, net of the aggregate rent paid to Host L.P. by the TRS, on which we record an income tax provision or benefit. For the third quarter and year-to-date of 2025, we recorded a net income tax provision of $9 million and $35 million, respectively, primarily due to the profitability of hotel operations retained by the TRS. The increase for year-to-date, as compared to 2024, is also due to the recognition of federal income tax credits related to the installation of a co-generation plant at one of our properties in 2024.

Previous wording

Our customers fall into three broad categories: transient, group, and contract business, which accounted for approximately 60%, 36%, and 4%, respectively, of our full year 2024 room sales. The information below is derived from business mix results from the 78 comparable hotels owned as of June 30, 2025. For additional detail on our business mix, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our most recent Annual Report on Form 10‑K.

Current wording

Our customers fall into three broad categories: transient, group, and contract business, which accounted for approximately 60%, 36%, and 4%, respectively, of our full year 2024 room sales. The information below is derived from business mix results from the 76 comparable hotels owned as of September 30, 2025, which excludes one hotel that was held-for-sale. For additional detail on our business mix, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our most recent Annual Report on Form 10‑K.

Previous wording

For the second quarter and year-to-date 2025, transient revenue increased by 6.8% and 5.8%, respectively, reflecting strong transient demand and improving leisure demand on Maui, which led to an increase in average rates of 5.1% and 5.3% for the quarter and year-to-date, respectively. Group revenue decreased by 4.9% for the second quarter, as anticipated, as a result of planned renovation disruption from the Hyatt Transformational Capital Program and business mix shifting from group to transient in Maui, as well as softness in short-term group demand which is expected to continue for the remainder of the year. Year-to-date, group revenue increased 0.6% compared to 2024, benefiting from special events in the first quarter of 2025.

Current wording

For the third quarter and year-to-date 2025, transient revenue increased by 1.7% and 4.6%, respectively, reflecting an increase in average rates of 3.0% and 4.6% for the quarter and year-to-date, respectively, driven by strong transient demand and improving leisure demand on Maui. As anticipated, group revenue decreased by 4.7% and 0.9% for the third quarter and year-to-date, respectively, as a result of planned renovation disruption from the Hyatt Transformational Capital

Previous wording

Capital Resources. As of June 30, 2025, we had $490 million of cash and cash equivalents, $279 million in our FF&E escrow reserves and $1.5 billion available under the revolver portion of our credit facility. We depend primarily on external sources of capital to finance future growth, including acquisitions. As a result, the liquidity and debt capacity provided by our credit facility and the ability to issue senior unsecured debt are key components of our capital structure. Our financial flexibility, including our ability to incur debt, pay dividends, make distributions and make investments, is contingent on our ability to maintain compliance with the financial covenants of our credit facility and senior notes indentures, which include, among other things, the allowable amounts of leverage, interest coverage and fixed charges.

Current wording

Capital Resources. As of September 30, 2025, we had $539 million of cash and cash equivalents, $205 million in our FF&E escrow reserves and $1.5 billion available under the revolver portion of our credit facility. We depend primarily on external sources of capital to finance future growth, including acquisitions. As a result, the liquidity and debt capacity provided by our credit facility and the ability to issue senior unsecured debt are key components of our capital structure. Our financial flexibility, including our ability to incur debt, pay dividends, make distributions and make investments, is contingent on our ability to maintain compliance with the financial covenants of our credit facility and senior notes indentures, which include, among other things, the allowable amounts of leverage, interest coverage and fixed charges.

Previous wording

Two programs are currently in place relating to potential purchases or sales of our common stock. Under our common stock repurchase program, common stock may be purchased from time to time depending upon market conditions and may be purchased in the open market or through private transactions or by other means, including principal transactions with various financial institutions, like accelerated share repurchases, forwards, options, and similar transactions and through one or more trading plans designed to comply with Rule 10b5-1 under the Securities Exchange Act of 1934, as amended. The plan does not obligate us to repurchase any specific number or any specific dollar amount of shares and may be suspended at any time at our discretion. During the second quarter of 2025, we repurchased 6.7 million shares of Host Inc. common stock at an average price of $15.56 per share, exclusive of commissions, through our common share repurchase program for a total of $105 million. At June 30, 2025, we had $480 million available for repurchase under our program.

Current wording

Two programs are currently in place relating to potential purchases or sales of our common stock. Under our common stock repurchase program, common stock may be purchased from time to time depending upon market conditions and may be purchased in the open market or through private transactions or by other means, including principal transactions with various financial institutions, like accelerated share repurchases, forwards, options, and similar transactions and through one or more trading plans designed to comply with Rule 10b5-1 under the Securities Exchange Act of 1934, as amended. The plan does not obligate us to repurchase any specific number or any specific dollar amount of shares and may be suspended at any time at our discretion. There were no share repurchases during the third quarter of 2025. At September 30, 2025, we had $480 million available for repurchase under our program.

Previous wording

In addition, on May 31, 2023, we entered into a distribution agreement with J.P. Morgan Securities LLC, BofA Securities, Inc., Goldman Sachs & Co. LLC, Jefferies LLC, Morgan Stanley & Co. LLC, Scotia Capital (USA) Inc., Truist Securities, Inc. and Wells Fargo Securities, LLC, as sales agents pursuant to which Host Inc. may offer and sell, from time to time, shares of Host Inc. common stock having an aggregate offering price of up to $600 million. The sales will be made in transactions that are deemed to be “at the market” offerings under the SEC rules. We may sell shares of Host Inc. common stock under this program from time to time based on market conditions, although we are not under an obligation to sell any shares. We may sell shares when we believe conditions are advantageous and there is a compelling use of proceeds, including to fund future potential acquisitions or other investment opportunities. The agreement also contemplates that, in addition to the offering and sale of shares to or through the sales agents, we may enter into separate forward sale agreements with each of the forward purchasers named in the agreement. No shares were issued during the second quarter of 2025. As of June 30, 2025, there was $600 million of remaining capacity under the agreement.

Current wording

In addition, on May 31, 2023, we entered into a distribution agreement with J.P. Morgan Securities LLC, BofA Securities, Inc., Goldman Sachs & Co. LLC, Jefferies LLC, Morgan Stanley & Co. LLC, Scotia Capital (USA) Inc., Truist Securities, Inc. and Wells Fargo Securities, LLC, as sales agents pursuant to which Host Inc. may offer and sell, from time to time, shares of Host Inc. common stock having an aggregate offering price of up to $600 million. The sales will be made in transactions that are deemed to be “at the market” offerings under the SEC rules. We may sell shares of Host Inc. common stock under this program from time to time based on market conditions, although we are not under an obligation to sell any shares. We may sell shares when we believe conditions are advantageous and there is a compelling use of proceeds, including to fund future potential acquisitions or other investment opportunities. The agreement also contemplates that, in addition to the offering and sale of shares to or through the sales agents, we may enter into separate forward sale agreements with each of the forward purchasers named in the agreement. No shares were issued during the third quarter of 2025. As of September 30, 2025, there was $600 million of remaining capacity under the agreement.

Previous wording

Cash Provided by Operating Activities. Year-to-date in 2025, net cash provided by operating activities was $749 million compared to $818 million for year-to-date in 2024. The decrease was due to payments for condominium inventory and increased interest payments which offset cash from improved operations at our properties.

Current wording

Cash Provided by Operating Activities. Year-to-date in 2025, net cash provided by operating activities was $967 million compared to $1,167 million for year-to-date in 2024. The decrease was due to payments for condominium inventory and increased interest payments, which offset increases in cash from improved operations at our properties.

Previous wording

Cash Used in Investing Activities. Net cash used in investing activities was $198 million for year-to-date in 2025 compared to $775 million for year-to-date in 2024. Cash used in investing activities year-to-date in 2025 and 2024 primarily related to $298 million and $224 million of capital expenditures, respectively, as well as investments in our joint ventures, while 2024 also included the acquisition of two hotels. Cash provided by investing activities in 2025 included proceeds from the sale of one hotel and the repayment of a note receivable.

Current wording

Cash Used in Investing Activities. Net cash used in investing activities was $300 million for year-to-date in 2025 compared to $1,851 million for year-to-date in 2024. Cash used in investing activities year-to-date in 2025 and 2024 included $454 million and $375 million of capital expenditures, respectively, as well as investments in our joint ventures, while 2024 also included the acquisition of four hotels for approximately $1.5 billion. Cash provided by investing activities in 2025 included proceeds from the sale of two hotels and the repayment of a note receivable.

Previous wording

Cash Used in Financing Activities. Year-to-date in 2025, net cash used in financing activities was $583 million compared to $353 million for year-to-date in 2024. Cash used in financing activities in both 2025 and 2024 primarily related to the payment of common stock dividends, common stock repurchases, and the repayment of senior notes. Cash provided by financing activities year-to-date in both 2025 and 2024 included the issuance of new senior notes.

Current wording

Cash Provided by (Used in) Financing Activities. Year-to-date in 2025, net cash used in financing activities was $723 million compared to cash provided by financing activities of $129 million for year-to-date in 2024. Cash used in financing activities in both 2025 and 2024 primarily related to the payment of common stock dividends, common stock repurchases, and the repayment of senior notes. Cash provided by financing activities year-to-date in both 2025 and 2024 included the proceeds from the issuance of new senior notes.

Previous wording

(1)In connection with the dividend payments, Host L.P. made distributions of $492 million to its common OP unit holders.

Current wording

(1)In connection with the dividend payments, Host L.P. made distributions of $631 million to its common OP unit holders.

Previous wording

As of June 30, 2025, our total debt was $5.1 billion, with a weighted average interest rate of 4.9% and a weighted average maturity of 5.4 years. Additionally, 80% of our debt has a fixed rate of interest, and only one of our consolidated hotels is encumbered by mortgage debt.

Current wording

As of September 30, 2025, our total debt was $5.1 billion, with a weighted average interest rate of 4.9% and a weighted average maturity of 5.2 years. Additionally, 80% of our debt has a fixed rate of interest, and only one of our consolidated hotels is encumbered by mortgage debt.