Company: INTG
Filing Date: 2025-09-30
Form Type: 10-K
Source: 0001493152-25-016154
Chunk: 7

Company: INTERGROUP CORP
Filing Date: 2025-09-30
Form: 10-K
Item: Item 1
Chunk 7
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6 of the Notes to Consolidated Financial Statements.

SEASONALITY

Historically,
the Hotel’s operation has been seasonal under normal circumstances. Like most hotels in the San Francisco Bay Area, the Hotel generally
maintained high occupancy and room rates during the entire year except for the weeks starting from Thanksgiving to the first week of
January due to the holiday season. These seasonal patterns can be expected to cause fluctuations in the quarterly revenues of the Hotel.
See Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations for more information regarding
the effects on our results of operations. Climate variability or extreme weather events could alter historical seasonal trends and impact
occupancy and room rates, as discussed in Item 1A – Risk Factors.

COMPETITION

The
Hotel has successfully completed its full guest rooms renovation over the last two years, along with renovations to public space, the
fitness center, corridors, and meeting space. With newly renovated rooms, the Hotel expects to drive rate and grow RevPar relative to
the market and its competitive set (“CompSet”). The Hotel recently received its annual Quality Assurance inspection from
Hilton and received the highest score in at least the last decade at 96.7%, which is an “Outstanding” ranking by Hilton.

During
the fiscal year ended June 30, 2025, the Hotel’s CompSet achieved a RevPAR of $172.84 while the Hotel had a RevPAR of $214.66. 
Since the completion of the renovation in June 2024, the Hotel has increased its lead in RevPAR on the CompSet dramatically, growing
RevPAR 23% while the CompSet declined by 8.3% over the same time.

The
Hotel’s location in the San Francisco Financial District historically has provided greater opportunities over its competitors when
it comes to developing relationships with the Financial District entities and the customers who regularly do business in the downtown
area. With business travel slowly returning to San Francisco post-pandemic, we are competing with hotels in more tourist attracting locations
and amenities for the leisure traveler. The ability to capitalize on the strong midweek demand of the individual business traveler to
the Financial District has been the focus during this period of strong growth in the market. The city is seeing the return of a stronger
convention calendar along with business travel trending positively.

6

The
Hotel is also subject to certain operating risks common to all of the hotel industry, which could adversely impact performance, including
those set forth