Company: PEB
Filing Date: 2025-07-29
Form Type: 10-Q
Source: 0001474098-25-000119
Chunk: 7

Company: Pebblebrook Hotel Trust
Filing Date: 2025-07-29
Form: 10-Q
Item: Item 2
Chunk 7
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 room renovation and conversion to the Hyatt brand.

Hotel operating expenses — Total hotel operating expenses increased by $6.1 million primarily due to increased operations at Newport Harbor Island Resort, and an increase in wage rates and benefits at many of our properties. 

Real estate taxes, personal property taxes, property insurance and ground rent — Real estate taxes, personal property taxes, property insurance and ground rent increased by $9.0 million primarily due to an increase in real estate tax assessments in 2025. In 2024, several California properties had lower property taxes as a result of the settlement of appeals from previous years.

Business interruption insurance income — We recognized business interruption insurance income in 2025 and 2024 related to partial settlements with our insurance carriers for lost income at LaPlaya Beach Resort & Club. 

Other operating expenses — Other operating expenses decreased by $1.1 million primarily due to a decrease in preopening expenses. 

Other, net — Other, net increased by $1.8 million due to interest income earned on excess cash balances. 

Income tax (expense) benefit — Income tax (expense) benefit increased by $6.8 million in 2025 as a result of taxable income of Pebblebrook Hotel Lessee, Inc. in the second quarter of 2025. In the second quarter of 2024, the deferred income tax of Pebblebrook Hotel Lessee, Inc. partially reduced the valuation allowance. 

27

Non-controlling interests — Non-controlling interests represents the allocation of income or loss of the Operating Partnership to third-party common OP unit holders and to the preferred OP unit holders.

Comparison of the six months ended June 30, 2025 to the six months ended June 30, 2024 

Revenues — Total revenues increased by $16.6 million primarily due to increases at Newport Harbor Island Resort, which was closed for renovation for part of 2024; LaPlaya Beach Resort & Club, where the Beach House was closed in 2024 due to hurricane damage and substantially reopened in 2025; Estancia La Jolla Hotel & Spa, which was under renovation in 2024; and demand increases at 1 Hotel San Francisco and The Westin Copley Place, Boston. This increase was partially offset by lower revenue at Hyatt Centric Delfina Santa Monica, which continued to ramp up from its room renovation and conversion to the Hyatt brand.

Hotel operating expenses — Total hotel operating expenses increased by $17.3 million primarily due to