On this page of StockholderLetter.com we present the latest annual shareholder letter from Braemar Hotels & Resorts Inc. — ticker symbol BHR. Reading current and past BHR letters to shareholders can bring important insights into the investment thesis.
2023 ANNUA L REPORT
Dear Fellow Shareholder, Braemar delivered a strong operational and financial performance in 2023. While not as impressive as 2022, the portfolio still posted solid results while we continued to work on liability management initiatives against a backdrop of challenging capital markets. It was clear early in the year that the success that we enjoyed in 2022 was not repeatable. As restrictions on international travel were lifted, the leisure segment increasingly headed overseas. Consequently, 2023 witnessed a return to a more typical trendline, leading to less favorable year-over-year comparisons. Nevertheless, we are excited about the opportunities that lie ahead. Our 2023 resort hotel performance was well in excess of 2019 pre-pandemic figures. In fact, our portfolio has seen the highest RevPAR growth versus 2019 compared to any other lodging REIT. Our hotels are well located in attractive, high barrier-to-entry leisure markets. Ten of our sixteen hotels are considered resort destinations and our luxury resort portfolio continues to deliver strong performance with hotel EBITDA of $149 million during the year. Further, our urban hotel portfolio continues its upward recovery trend as business transient and corporate group demand rises steadily, generating $57 million of comparable hotel EBITDA for 2023. Looking forward, work from home policies are becoming more restrictive and the citywide convention calendars are filling up. As a result, we remain very encouraged by the continued momentum for this segment. In fact, we anticipate that our urban hotels will be a primary driver of portfolio growth in the quarters ahead. During the past year, we also unveiled plans to rebrand our Mr. C. Beverly Hills Hotel to Cameo Beverly Hills. After a comprehensive renovation, it will join the LXR luxury brand by Hilton. We have already plugged it into the Hilton Central Reservation System and Hilton Honors guest loyalty program in anticipation of completing this transformation. This property is an iconic asset with a great location and is slated for a renovation encompassing updates to the guestrooms, guest bathrooms, corridors, lobby, restaurant, fa ade, and meeting space. Our aim is to craft a distinctive theme and style for the property that is commensurate with the LXR brand, which it will join by the end of 2025. While we patiently remained on the sidelines during 2023 from an acquisitions perspective, we did initiate new asset management initiatives for the hotels we acquired in 2022, which continue to exceed our original underwriting. The Four Seasons Resort Scottsdale at Troon North, has been a great addition to our portfolio and achieved a 7.4% yield on cost for the year. We also continue to analyze the optimal solution for the nearly 6-acre development parcel we acquired as part of the acquisition. Braemar s other 2022 acquisition, The Ritz-Carlton Reserve Dorado Beach, also continues to perform very well, achieving a 9.3% yield on cost for the year. These luxury assets have outpaced our underwriting and, looking ahead to 2024, we remain very encouraged about the prospects for these well-positioned properties. In closing, we are keeping our eye on the interest rate cycle, which is one of the most important factors impacting our balance sheet. Encouragingly, it appears that the Fed will move to cut short term rates at some point this year, freeing up additional cashflow. This positive development is coupled with anticipated growth in RevPAR across lodging chain scale segments, but especially for luxury and upper upscale properties. Given our unique positioning, with the highest quality portfolio in the hospitality REIT space, I continue to believe that Braemar represents a compelling opportunity for investors. We see a clear path for steady strength in our operating performance and remain confident in our position to restore shareholder value as we continue to deliver results over the course of 2024. Thank you for joining us on this journey. Sincerely, Richard J. Stockton President & Chief Executive Officer
Gallery The Ritz-Carlton Lake Tahoe Truckee, CA The Notary Hotel The Capital Hilton Washington, DC Philadelphia, PA Hotel Yountville Bardessono Hotel and Spa The Ritz-Carlton Reserve Dorado Beach Cameo Beverly Hills Park Hyatt Beaver Creek The Ritz-Carlton St. Thomas Yountville, CA Beverly Hills, CA Yountville, CA Beaver Creek, CO Dorado, Puerto Rico St. Thomas, USVI
Pier House Resort Key West, FL The Ritz-Carlton Sarasota Sofitel Chicago Magnificent Mile Chicago, IL San Francisco, CA Marriott Seattle Hilton La Jolla Torrey Pines Four Seasons Resort Scottsdale at Troon North Sarasota, FL Seattle, WA La Jolla, CA The Clancy Scottsdale, AZ
 • shareholder letter icon 6/18/2024 Letter Continued (Full PDF)
 • stockholder letter icon 4/3/2023 BHR Stockholder Letter
 • stockholder letter icon More "Hotels" Category Stockholder Letters
 • Benford's Law Stocks icon BHR Benford's Law Stock Score = 95


BHR Shareholder/Stockholder Letter Transcript:

2023 ANNUA L REPORT

Dear Fellow Shareholder,
Braemar delivered a strong operational and
financial performance in 2023. While not as
impressive as 2022, the portfolio still posted
solid results while we continued to work on
liability management initiatives against a
backdrop of challenging capital markets. It
was clear early in the year that the success that
we enjoyed in 2022 was not repeatable. As
restrictions on international travel were lifted,
the leisure segment increasingly headed
overseas. Consequently, 2023 witnessed a
return to a more typical trendline, leading to
less favorable year-over-year comparisons.
Nevertheless, we are excited about the
opportunities that lie ahead. Our 2023 resort
hotel performance was well in excess of 2019
pre-pandemic figures. In fact, our portfolio
has seen the highest RevPAR growth versus
2019 compared to any other lodging REIT. Our
hotels are well located in attractive, high
barrier-to-entry leisure markets. Ten of our
sixteen hotels are considered resort
destinations and our luxury resort portfolio
continues to deliver strong performance with
hotel EBITDA of $149 million during the year.
Further, our urban hotel portfolio continues
its upward recovery trend as business transient
and corporate group demand rises steadily,
generating $57 million of comparable hotel
EBITDA for 2023. Looking forward, work from
home policies are becoming more restrictive
and the citywide convention calendars are
filling up. As a result, we remain very
encouraged by the continued momentum for
this segment. In fact, we anticipate that our
urban hotels will be a primary driver of
portfolio growth in the quarters ahead.
During the past year, we also unveiled plans
to rebrand our Mr. C. Beverly Hills Hotel to
Cameo Beverly Hills. After a comprehensive
renovation, it will join the LXR luxury brand
by Hilton. We have already plugged it into the
Hilton Central Reservation System and Hilton
Honors guest loyalty program in anticipation
of completing this transformation. This
property is an iconic asset with a great
location and is slated for a renovation
encompassing updates to the guestrooms,
guest bathrooms, corridors, lobby, restaurant,
fa  ade, and meeting space. Our aim is to craft
a distinctive theme and style for the property
that is commensurate with the LXR brand,
which it will join by the end of 2025.
While we patiently remained on the sidelines
during 2023 from an acquisitions perspective,
we did initiate new asset management
initiatives for the hotels we acquired in 2022,
which continue to exceed our original
underwriting. The Four Seasons Resort
Scottsdale at Troon North, has been a great
addition to our portfolio and achieved a 7.4%
yield on cost for the year. We also continue to
analyze the optimal solution for the nearly
6-acre development parcel we acquired as
part of the acquisition. Braemar   s other 2022
acquisition, The Ritz-Carlton Reserve Dorado
Beach, also continues to perform very well,
achieving a 9.3% yield on cost for the year.
These luxury assets have outpaced our
underwriting and, looking ahead to 2024, we
remain very encouraged about the prospects
for these well-positioned properties.
In closing, we are keeping our eye on the
interest rate cycle, which is one of the most
important factors impacting our balance
sheet. Encouragingly, it appears that the Fed
will move to cut short term rates at some point
this year, freeing up additional cashflow. This
positive development is coupled with
anticipated growth in RevPAR across lodging
chain scale segments, but especially for luxury
and upper upscale properties. Given our
unique positioning, with the highest quality
portfolio in the hospitality REIT space, I
continue to believe that Braemar represents a
compelling opportunity for investors. We see
a clear path for steady strength in our
operating performance and remain confident
in our position to restore shareholder value as
we continue to deliver results over the course
of 2024.
Thank you for joining us on this journey.
Sincerely,
Richard J. Stockton
President & Chief Executive Officer

Gallery
The Ritz-Carlton Lake Tahoe
Truckee, CA
The Notary Hotel
The Capital Hilton
Washington, DC
Philadelphia, PA
Hotel Yountville
Bardessono Hotel and Spa
The Ritz-Carlton Reserve Dorado Beach
Cameo Beverly Hills
Park Hyatt Beaver Creek
The Ritz-Carlton St. Thomas
Yountville, CA
Beverly Hills, CA
Yountville, CA
Beaver Creek, CO
Dorado, Puerto Rico
St. Thomas, USVI

Pier House Resort
Key West, FL
The Ritz-Carlton Sarasota
Sofitel Chicago Magnificent Mile
Chicago, IL
San Francisco, CA
Marriott Seattle
Hilton La Jolla Torrey Pines
Four Seasons Resort Scottsdale at Troon North
Sarasota, FL
Seattle, WA
La Jolla, CA
The Clancy
Scottsdale, AZ



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