WILLIAMSBURG, Va., Aug. 12, 2025 (GLOBE NEWSWIRE) — Sotherly Hotels Inc. (NASDAQ: SOHO), (“Sotherly” or the “Company”), a self-managed and self-administered lodging real estate investment trust (a “REIT”), today reported its consolidated results for the second quarter ended June 30, 2025. The Company’s results include the following*:

(*)   Earnings before interest, taxes, depreciation and amortization (“EBITDA”), Hotel EBITDA, Funds From Operations (“FFO”) attributable to common stockholders and unitholders, Adjusted FFO attributable to common stockholders and unitholders, FFO per common share and unit and Adjusted FFO per common share and unit are non-GAAP financial measures. See further discussion of these non-GAAP measures, including definitions related thereto, and reconciliations to net (loss) income later in this press release. The Company is the sole general partner of Sotherly Hotels LP, a Delaware limited partnership (the “Operating Partnership”), and all references in this release to the “Company,” “Sotherly,” “we,” “us,” and “our” refer to Sotherly Hotels Inc., its Operating Partnership and its subsidiaries and predecessors, unless the context otherwise requires or it is otherwise indicated.

HIGHLIGHTS

• RevPAR. Room revenue per available room (“RevPAR”) for the Company’s composite portfolio, which includes the rooms participating in our rental programs at the Lyfe Resort & Residences (f/k/a Hyde Resort & Residences) and the Hyde Beach House Resort & Residences, decreased 5.4% to $130.20, for the three months ended June 30, 2025, from $137.67 in the comparable period in 2024. Changes in RevPAR were driven by a 3.5% decrease in occupancy to 70.8% from 73.4% in the comparable 2024 period, and a 1.9% decrease in the average daily rate (“ADR”) to $183.88 for the three months ended June 30, 2025, from $187.51 for the comparable period in 2024. For the six months ended June 30, 2025, RevPAR decreased to $129.97, from $130.64 in the comparable period in 2024.  Changes in RevPAR were driven by an increase in the occupancy to 69.8% for the six months ended June 30, 2025, from 69.2% for the comparable period in 2024 and by a decrease in ADR to $186.14 from $188.91 in the comparable 2024 period.
• Revenue. Total revenue decreased to approximately $48.8 million, from approximately $50.7 million, for the three months ended June 30, 2025 and 2024, respectively. For the six-month period ending June 30, 2025, total revenue decreased to approximately $97.1 million, from approximately $97.2 million during the comparable period in 2024.
• Net income (loss) attributable to common stockholders. For the three months ended June 30, 2025, net income (loss) attributable to common stockholders decreased approximately $3.0 million, compared to the three months ended June 30, 2024, from income of approximately $2.6 million to loss of approximately $0.4 million. For the six-month period ending June 30, 2025, net income attributable to common stockholders increased 15.9%, or approximately $0.3 million, over the six months ended June 30, 2024, from an income of approximately $2.0 million to an income of approximately $2.3 million. 
• Hotel EBITDA. Hotel EBITDA decreased to approximately $13.9 million for the three months ended June 30, 2025, from approximately $15.7 million for the comparable period in 2024. Hotel EBITDA for the six months ended June 30, 2025 decreased approximately $1.2 million to approximately $26.8 million, from approximately $28.0 million generated in the comparable 2024 period.
• Adjusted FFO attributable to common stockholders and unitholders. For the three months ended June 30, 2025, Adjusted FFO attributable to common stockholders and unitholders decreased 36.6%, or approximately $2.7 million, over the three months ended June 30, 2024, from approximately $7.5 million to approximately $4.8 million. For the six-month period ending June 30, 2025, adjusted FFO attributable to common stockholders and unitholders decreased 26.9%, or by approximately $3.4 million, over the six months ended June 30, 2024, from approximately $12.7 million to approximately $9.3 million.
• Preferred Dividends. On July 24, 2025 the Company announced a quarterly cash dividend of $0.50 per share of beneficial interest of the Company’s 8.0% Series B Cumulative Redeemable Perpetual Preferred Stock; a quarterly cash dividend of $0.492188 per share of beneficial interest of the Company’s 7.875% Series C Cumulative Redeemable Perpetual Preferred Stock; and a quarterly cash dividend of $0.515625 per share of beneficial interest of the Company’s 8.25% Series D Cumulative Redeemable Perpetual Preferred Stock. Each of the Series B, Series C and Series D preferred dividends will be paid on November 20, 2025 to shareholders of record as of October 31, 2025.

Dave Folsom, President and Chief Executive Officer of Sotherly Hotels Inc., commented, “In the second quarter we witnessed a deceleration in hotel demand across our portfolio. A majority of our competitive set properties witnessed RevPAR reductions versus the same quarter 2024.  The reduction in hotel demand mirrors the larger uncertainty associated with the macroeconomic environment, being a function of both the ongoing interest rate climate and tariffs. At our hotels, business transient demand in the quarter was only slightly off to 2024, showing the resilience of this all-important revenue segment.  Group booking pace also remains resilient, with only minor reductions compared to the same pace in 2024.

We also continue to address mortgage maturities across our portfolio.  We are working on extending certain mortgages, while concurrently working to refinance hotels that have significant equity.  We also recently announced the prospective sale of the standalone 700+ space parking garage co-located with our hotel in Atlanta, Georgia. Monetizing the parking garage, via a sale, will provide liquidity to address the existing loan at this hotel, and we estimate, will add to Sotherly’s overall liquidity balance. We expect that transaction to close in Q4.    

We remain cautious regarding the demand picture within the lodging markets. We believe that a changing interest rate picture, along with certainty regarding other macroeconomic forces, may act as a catalyst for the lodging industry and convey upside in hotel fundamentals as we move forward into the latter half of the year. ”

Balance Sheet/Liquidity

As of June 30, 2025, the Company had approximately $26.5 million of available cash and cash equivalents, of which approximately $16.0 million was reserved for real estate taxes, insurance, capital improvements and certain other expenses or otherwise restricted. The Company had principal balances of approximately $315.8 million in outstanding debt, including mortgage and unsecured principal balances, at a weighted average interest rate of approximately 5.89%.

Portfolio Update

On July 24, 2025, SOHO Atlanta, LLC, a Delaware limited liability company and an affiliate of the Company, entered into a sale, purchase and escrow agreement to sell a portion of its real estate containing the parking garage (the “Parking Garage”), associated with the Georgian Terrace hotel (the “Hotel”), located in Atlanta, Georgia, to Banyan Street Capital LLC, a Delaware limited liability company, for a purchase price of $17.75 million.  The Company intends to use the net cash proceeds from the sale of the Parking Garage to pay down a portion of the principal balance on the existing mortgage for the Hotel. The closing of the sale of the Parking Garage is subject to the waiver or satisfaction of various closing conditions, including (i) a condition related to the completion of a separate reciprocal easement agreement; (ii) a condition related to governmental approvals; (iii) a condition related to the consent of the existing mortgage lender; (iv) the satisfactory completion of a diligence review of the Parking Garage; (v) the accuracy of representations and warranties through closing; and (vi) conditions related to the termination of Parking Garage agreements and leases.  The Company expects to consummate the transaction in the fourth quarter of 2025.

2025 Outlook

The Company is updating its previously issued guidance for 2025. The full year guidance range provided is based on information currently available, including moderating trends and volatility caused by macroeconomic trends.  The table below reflects the Company’s projections, within a range, of various financial measures for 2025, in thousands of dollars, except per share and RevPAR

Earnings Call/Webcast

The Company will conduct its second quarter 2025 conference call for investors and other interested parties at 10:00 a.m. Eastern Time on Tuesday, August 12, 2025. The conference call will be accessible by telephone and through the Internet. Interested individuals are invited to listen to the call by telephone at 833-470-1428 (United States) and enter access code 203681. To participate on the webcast, log on to www.sotherlyhotels.com at least 15 minutes before the call to download the necessary software. For those unable to listen to the call live, a taped rebroadcast will be available beginning one hour after completion of the live call on August 12, 2025 through August 19, 2025. To access the rebroadcast, dial 866-813-9403 and enter access code 298292.

About Sotherly Hotels Inc.

Sotherly Hotels Inc. is a self-managed and self-administered lodging REIT focused on the acquisition, renovation, upbranding and repositioning of upscale to upper-upscale full-service hotels in the Southern United States. Sotherly may also opportunistically acquire hotels throughout the United States. Currently, the Company’s portfolio consists of investments in ten hotel properties, comprising 2,786 rooms, as well as interests in two condominium hotels and their associated rental programs. The Company owns hotels that operate under the Hilton Worldwide and Hyatt Hotels Corporation brands, as well as independent hotels. Sotherly Hotels Inc. was organized in 2004 and is headquartered in Williamsburg, Virginia. For more information, please visit www.sotherlyhotels.com.

Forward-Looking Statements

This news release includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and as such may involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements, which are based on certain assumptions and describe our current strategies, expectations, and future plans are generally identified by our use of words, such as “intend,” “plan,” “may,” “should,” “will,” “project,” “estimate,” “anticipate,” “believe,” “expect,” “continue,” “potential,” “opportunity,” “outlook,” and similar expressions, whether in the negative or affirmative, but the absence of these words does not necessarily mean that a statement is not forward-looking. We also sometimes refer to our booking pace. Booking pace is an industry term that we define as the estimated value of committed future bookings at a given point in time. Booking pace can be further separated into various segments, including group booking pace or business travel booking pace. All statements regarding our expected financial position, booking pace, business and financing plans are forward-looking statements.

Factors which could have a material adverse effect on the Company’s future operations, results, performance and prospects, include, but are not limited to: national and local economic and business conditions that affect occupancy rates and revenues at our hotels and the demand for hotel products and services; risks associated with the hotel industry, including competition and new supply of hotel rooms, increases in wages, energy costs and other operating costs; risks associated with the level of our indebtedness and our ability to meet covenants in our debt agreements, including loan modifications and, as necessary, to refinance or seek an extension of the maturity of such indebtedness or further modification of such debt agreements; risks associated with adverse weather conditions, including hurricanes; impacts on the travel industry from pandemic diseases, including COVID-19; the availability and terms of financing and capital and the general volatility of the securities markets; management and performance of our hotels; risks associated with maintaining our system of internal controls; risks associated with the conflicts of interest of the Company’s officers and directors; risks associated with redevelopment and repositioning projects, including delays and cost overruns; supply and demand for hotel rooms in our current and proposed market areas; risks associated with our ability to maintain our franchise agreements with our third party franchisors; our ability to acquire additional properties and the risk that potential acquisitions may not perform in accordance with expectations; our ability to successfully expand into new markets; legislative/regulatory changes, including changes to laws governing taxation of real estate investment trusts (“REITs”); the Company’s ability to maintain its qualification as a REIT; and our ability to maintain adequate insurance coverage. Although the Company believes that the assumptions underlying the forward-looking statements contained herein are reasonable, any of the assumptions could be inaccurate, and therefore there can be no assurance that such statements included in this report will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by the Company or any other person that the results or conditions described in such statements or the objectives and plans of the Company will be achieved.

Additional factors that could cause actual results to vary from our forward-looking statements are set forth under the section titled “Risk Factors” in our Annual Report on Form 10-K, in this press release and subsequent reports filed with the Securities and Exchange Commission. Except as required by law, the Company undertakes no obligation to and does not intend to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. Although the Company believes its current expectations to be based upon reasonable assumptions, it can give no assurance that its expectations will be attained or that actual results will not differ materially.

Financial Tables Follow…

Prioritizing the familiar coastal charm beloved by guests, SKAI Bar & Grill offers a new perspective of the shoreline, situated on a new terrace that conveys the environment of a secret garden away from the crowd.

The space is further decorated by floor‐to‐ceiling windows complemented by verdant plantings and sculpted laser‐cut screens that frame the golden hour in warm, dappled light. Hand‐woven seating in driftwood grey and sandy taupe mirrors the beach’s natural palette, ensuring the extension remains true to its waterfront origins.

The cuisine is sure to be sublime, a place for the Levantine‐inspired creations to flourish, such as tender cuts anointed with fragrant za’atar, sumac‐bright citrus glazes and smoked‐paprika pastes. Each dish, enhanced by the gentle sea breeze, encapsulates the magic of the sea, redefined through the spice and soul of the Eastern Mediterranean.

At the heart of the establishment lies an open‐kitchen pavilion where guests can watch chefs transform into artisans in motion, where every sizzle and pop become part of the evening’s performance, manipulating glowing embers and artisan charcoal with its primal beauty of fire and flavor to deliver SKAI’s hallmark signature cuts: Angus Tenderloin, Grass‐Fed MB3+ and Pork Chop Pata Negra Ibérico, among others.

To personalize every bite, diners are invited to choose from the expansive selection of salt, where a curated selection, from wood‐smoked sea salt to herb‐infused and zesty citrus blends, awaits their finishing flourish. Every guest is also encouraged to accompany their meal with SKAI’s house‐made sourdough, celebrated across Legian for its crackling crust and delightfully chewy crumb; the perfect companion for mopping up every last drop of jus.

For more information about Padma Hotels and to explore each property’s latest offerings, please visit PadmaHotels.com.