A small, covered 2.7% yield that was actually raised in 2026, held back only by its 2020 history. The $0.10 quarterly dividend, raised from $0.09 in 2026, annualizes to about 2.7% and is covered at about 31% of guided AFFO, with Q2 AFFO of $0.48 up 22% year over year. Leverage of about 4.0 times, on labelled arithmetic, sits inside the pass band, and RevPAR rose 3% to $158 across 39 comparable hotels even as occupancy slipped 50 basis points to 81%. The dividend was suspended in 2020 and the rebuild is the mildest caution in this batch — a raise, not a flat hold — but the history still grades as a flag.
Key risk: Occupancy slipped even as RevPAR rose, so rate growth is doing the work.
Changes if: Occupancy falls further, or guided AFFO is cut enough to push payout toward 80%.
- ✓AFFO payout ~31% of guided AFFO, under the 80% pass threshold; Q2 21%. Q2 AFFO $0.48, +22% YoY (recast for share-based compensation add-back from 2026).
- ✓Leverage ~4.0× on labelled arithmetic, under the 6× pass threshold.
- !Raise history Raised from $0.09 to $0.10 in 2026 (H1 declared $0.20 vs $0.18 H1 2025); suspended 2020, rebuilt since.
- ✓Operating RevPAR $158, +3%; occupancy 81%, −50bps; Q2 AFFO $0.48, +22% YoY.
What this grade doesn't say: It screens the dividend only — covered, real, compounding. It says nothing about valuation or price: a well-covered payer can still be overpriced, and its price can still fall.