World’s first Black billionaire Robert L. Johnson’s REIT hits $1.3 billion in revenue

Key Points

• RLJ Lodging Trust’s revenue grew 3.3% to $1.37 billion, driven by strong RevPAR gains and portfolio expansion, but net income fell 11.2% due to higher expenses.
• The REIT repurchased 2.3 million shares for $22 million and acquired land beneath a key hotel asset, reinforcing its long-term strategy and financial positioning.
• Despite a slight asset decline to $4.88 billion, RLJ’s total equity rose 2.28% to $2.35 billion, maintaining its stature as a major Black-owned publicly listed business.

RLJ Lodging Trust, a leading hotel-focused real estate investment trust (REIT) controlled by the world’s first Black billionaire, Robert L. Johnson, delivered moderate financial growth in 2024, driven by higher revenue per available room (RevPAR) and strategic acquisitions. However, rising operational costs and shrinking profit margins put pressure on net income, prompting management to focus on cost efficiencies and asset optimization.

Revenue rises, but higher costs squeeze profits

The company’s total revenue grew 3.3 percent year-over-year to $1.37 billion, reflecting strong travel demand and a 2 percent increase in comparable RevPAR to $144.72. Room revenue climbed to $1.12 billion, up from $1.10 billion in 2023, while food and beverage sales rose to $153.1 million from $141.6 million.

Despite these gains, net income fell 11.2 percent to $42.9 million, compared to $51.3 million the previous year. The drop was largely due to higher operating expenses, which increased from $1.17 billion to $1.22 billion, driven by rising labor and property maintenance costs. Adjusted EBITDA also edged down slightly to $361.6 million from $364.5 million, reflecting tighter margins.

CEO stresses disciplined growth strategy

Leslie D. Hale, RLJ Lodging Trust’s President & CEO, emphasized the company’s focus on acquisitions, property conversions, and capital allocation to strengthen its position.

“We executed on our strategic priorities in 2024—expanding our portfolio with high-quality assets, advancing multi-year brand conversions, and reinforcing our balance sheet,” Hale said. “Our disciplined approach, including share repurchases and targeted reinvestments, keeps us well-positioned for long-term value creation.”

The company repurchased 2.3 million shares for $22 million at an average price of $9.39 per share, while maintaining $900 million in liquidity. It also invested $125 million to acquire fee-simple ownership of the Wyndham Boston Beacon Hill land, eliminating a ground lease.

Expansion efforts included the $35.5 million acquisition of Hotel Teatro in Denver, along with rebranding moves such as converting Wyndham Houston Medical Center into a DoubleTree by Hilton and Hotel Indigo New Orleans into Hotel Tonnelle, a Marriott Tribute. RLJ also streamlined its portfolio by selling two non-core properties for $20.8 million.

Modest asset decline, but strong equity position

As of Dec. 31, 2024, RLJ Lodging Trust’s total assets stood at $4.88 billion, slightly down from $4.92 billion. However, equity rose 2.3 percent to $2.35 billion, underscoring a stable financial position.

Founder Robert L. Johnson remains actively involved in shaping the company’s strategy, reinforcing RLJ’s status as one of the largest publicly traded Black-owned businesses in the U.S. With the hospitality industry navigating shifting market conditions, RLJ’s ability to balance expansion with cost control will be key to sustaining shareholder value in 2025 and beyond.