Storm Repairs Push Hotel Owners to Rethink Capital Spending
Host Hotels & Resorts estimated $105 million in damage from hurricanes Helene and Milton at The Don CeSar, with 30% tied to remediation. The company spent $75 million on restoration work in 2025 and received $73 million in insurance payouts. Over six years, about 8% of its capital expenditures went toward climate resilience measures.
The Don CeSar remained shuttered until late March 2025 following the 2024 storms, with its full range of amenities only returning by the third quarter of that year. Host's $75 million restoration outlay represented roughly 11.6% of its total capital expenditures for 2025.
Over a six-year period ending in December 2025, the company allocated about 8% of its capital budget toward climate resilience upgrades. The $73 million in insurance proceeds accounted for both physical repairs and lost business revenue, though the company acknowledges such investments do not eliminate future risk.
The financial burden of storm recovery could reshape how coastal hospitality operators allocate future budgets. Owners may face rising insurance premiums and increased pressure to fund resilience measures, potentially leading to higher room rates for travelers. Communities reliant on tourism could experience prolonged economic dips during extended closures. This trend may also accelerate investment in sturdier infrastructure, though smaller independent hotels might struggle to match the capital reserves of large REITs.