James F. Risoleo
President, Chief Executive Officer at Host Hotels & Resorts
Thank you, Jaime and thanks to everyone for joining us this morning. Before we turn to the quarter, I want to take a moment to acknowledge the devastating effects of Hurricanes Helene and Molly, which made landfall in late September and early October. We were deeply saddened to see the loss of life and damage the hurricanes brought. And while many of our hotels were impacted, we are very fortunate that the employees at our properties remain safe throughout the storms. In response to the urgent needs of those impacted, we partnered with the American Red Cross, World Central Kitchen, Team Rubicon, Community Foundation Tampa Bay and feeding Tampa Bay to deliver vital disaster relief support.
Due to evacuation mandates and the loss of commercial power from Hurricane Helene and Molly, four of our properties were temporarily closed, three of which reopened within 10 days. The most significant damage occurred at The Don CeSar, which remains closed to guests. We are still evaluating the remediation and disruption impacts of the storms and we currently expect a phased reopening of the Don CeSar beginning towards the end of the first quarter of 2025. Please note that the Don CeSar is still included in our comparable hotel results in the third quarter, but it has been removed from our comparable hotel set in our full-year guidance. It is worth noting that our resilience investments at the Ritz-Carlton, Naples paid-off during both hurricanes.
As a reminder, during the remediation following Hurricane Ian, we opportunistically enhanced the resiliency of the property by elevating critical equipment, improving dry flood proofing measures and accelerating future building envelope waterproofing replacements. As a result of these investments, we saw minimal water intrusion inside the resort despite a storm surge comparable to that of Hurricane Ian. And we reopened the resort seven days after commercial power was restored. Following the success of these enhanced resiliency measures, we will continue to prioritize these types of investments across our portfolio over the near-term.
For additional details on our resiliency investments, please see our 2024 Corporate Responsibility Report, which details our CR program and strategy, our ESG initiatives and our industry-leading accomplishments. It can be found on the Corporate Responsibility section of our website at hosthotels.com.
Turning to our results in the third quarter, we delivered adjusted EBITDAre of $324 million and adjusted FFO per share of $0.36. As a reminder, in the third quarter of last year, our adjusted EBITDAre benefited from $54 million of business interruption insurance proceeds, which led to a 10% decrease in our adjusted EBITDAre this quarter. Excluding the business interruption proceeds, our adjusted EBITDAre would have been up over 5% and adjusted FFO per share would have been up 9%.
We delivered a year-over-year comparable hotel total RevPAR improvement of 3.1%, underscoring the continued strength of out-of-room revenue, while comparable hotel RevPAR was up 80 basis points. As a reminder, the operational results discussed today refer to our comparable hotel portfolio for the third quarter, which excludes the Ritz-Carlton, Naples and Alila Ventana Big Sur. Our third quarter comparable hotel RevPAR came in slightly better than we expected despite weather impacts from the hurricanes in Florida during the last week of the quarter. While Maui is recovering, the year-over-year decline in RevPAR for Maui had an actual drag of 170 basis points in the third quarter. As we have discussed over the past few quarters, this understates the true impact of the wildfires as we would have expected Maui to contribute 20 basis-points to portfolio RevPAR growth in the third quarter, given the transformational renovation at Fairmont Kea Lani in 2023 and the expected lift for 2024.
As a result, the total estimated impact of the wildfires on third quarter RevPAR is approximately 190 basis points. Following the anniversary of the tragic wildfires, we supported our managers, local tourism authorities and government officials in promoting the return of visitors to Maui. Our three hotels launched the Ho'okipa marketing campaign. Ho'okipa means the spirit of hospitality in Hawaiian. The marketing efforts included social media and TV ads, digital displays, an email campaign and videos from each of our resorts that aired in Southern California during the month of September.
Additionally, the Governor of Hawaii, the Mayor of Maui and the head of the Hawaii Lodging and Tourism Association met with longtime supporters of Hawaii, the Los Angeles Rams and key travel partners across the Greater Los Angeles market to communicate the importance of tourism for Maui's economic recovery. The ramps have supported Hawaii over the years and part of the governor's trip was aimed at formalizing the relationship between the two going forward. Thus far, the sales and marketing efforts are paying-off. Thanksgiving infested revenue pace for our three Maui resort is up over 35% and over 65% respectively, compared to the same time last year. We are encouraged that Maui is beginning to show improvements on its road to recovery.
Moving on to business mix. Group room night revenue was up 1% in the third quarter, driven by rate as group room nights were flat due to the recovery in relief rooms in Maui that were booked in the third quarter of 2023. Our property booked 212,000 group room nights in the year for the year, bringing our definite group room nights on the books for 2024 to 4.2 million rooms with total group revenue pace up approximately 5% compared to the same time last year. Business transient revenue grew 5% in the third quarter, as strong rate growth was driven by market and customer mix shifts.
Turning to leisure, the unfavorable international demand imbalance held steady in the third quarter. Transit room nights sold at our comparable resource were up 4% in the third quarter, driven by Maui. In addition, leisure rates remained resilient during the third quarter. Transient rates at our comparable resource were up approximately 50% compared to 2019, which is in line with recent quarters, continuing to underscore the financial health of the affluent consumer.
Out-of-room spending trends this quarter also continued to demonstrate the strength of group and affluent consumers. Comparable hotel total RevPAR grew over 3% in the third quarter, which represents the largest spread to RevPAR growth in six quarters. As a reminder, in 2023, nearly 40% of our total revenue came from food and beverage and other revenue and our 2024 guidance assumes a similar proportion. We continue to believe that total RevPAR represents a more holistic picture of our underlying business, as our portfolio continues to benefit from substantial out of room spend.
Turning to capital allocation, during the quarter, we repurchased 3.5 million shares of stock at an average price of $16.33 per share through our common share repurchase program, bringing our total repurchases for the quarter to $57 million. Since 2022, we have repurchased $315 million of stock at an average repurchase price of $16.27 per share and we have $685 million of remaining capacity under our share repurchase program. Looking back on our transaction activity this year, we acquired $1.5 billion of iconic interreplaceable real estate and a blended 13.6 times EBITDA multiple based on estimated 2024 results. Thus far, the I Hotel in Nashville and the Embassy Suites by Hilton Nashville Downtown, the one hotel Central Park and the Ritz-Carlton O'ahu, Turtle Bay are performing in line with our underwriting expectations. The brand and management transition at the Ritz-Carlton O'ahu, Turtle Bay is going well and we expect continued growth as awareness of the rebranded resort spreads.
Turning to portfolio reinvestment, our updated 2024 capital expenditure guidance range is $485 million to $580 million, which includes approximately $225 million to $255 million of investment for redevelopment, repositioning and ROI projects, $225 million to $275 million for renewal and replacement projects and $35 million to $50 million for property damage reconstruction. Included in the ROI project is the Hyatt Transformational Capital Program, which is on-track and slightly under budget so far. We received $2 million of operating guarantees in the third quarter to offset business disruptions related to the Hyatt Transformational Capital Program and we expect to receive an additional $3 million this year, bringing the total operating guarantees to $9 million in 2024.
In addition to the capital expenditure range, this year, we expect to spend $50 million to $60 million on the 40 unit residential condo development at our Four Seasons Resort Orlando at Walt Disney World Resort. The development is well underway and marketing efforts begin in July. We anticipate the formal sales launch to begin later this month with closings to begin in the fourth quarter of 2025. More broadly, we have completed 24 transformational renovations since 2018, which we believe provide meaningful tailwinds for our portfolio. Of the 15 hotels that have stabilized post-renovation operations to date, the average RevPAR index share gain is over 7 points, which is well in excess of our targeted gain of three to five points.
Wrapping up, we continue to believe that Host is well-positioned due to our investment-grade balance sheet, our geographically diverse -- diversified portfolio and our continued reinvestment in our assets. As we have shown, we are able to access many capital allocation levers to create shareholder value and we will remain opportunistic going forward.
With that, I will now turn the call over to Sourav to discuss additional, operational detail and our revised 2024 outlook.