The current backdrop of the lodging industry is much different than it was a year ago, and RLJ Lodging Trust executives feel positive about the recovery and are looking to internal and external growth opportunities.

On a call with analysts to discuss first quarter 2021 earnings, RLJ President and CEO Leslie Hale said the hotel real estate investment trust is actively "underwriting acquisition targets and remains well-positioned to deploy growth capital through what we believe will be a multiyear growth window for acquisitions."

The pipeline of opportunities has grown for the REIT since its fourth-quarter 2020 earnings call, Hale said, adding that she's confident her team will be able to "source attractive acquisitions" this year. Still, the company will remain "extremely disciplined" with underwriting, she said.

RLJ wants to make sure deals are "accretive on a number of fronts," she said.

"Whether it's ... a complement to our portfolio, our operating metrics, the quality of assets and of course the returns. We're going to remain disciplined, although we do appreciate early cycle acquisitions tend to create more value," she said.

While RLJ is looking at acquisitions, Sean Mahoney, executive vice president and chief financial officer, said internal growth catalysts still come first.

Part of this strategy focuses on "maintaining adequate liquidity while making prudent capital allocation decisions to position our portfolio to drive out performance during the recovery and beyond," he said.

The REIT also "continues to prioritize high-value projects," which includes room additions at two hotels as well as converting Wyndham Hotels & Resorts-branded properties, he said.

RLJ's hotels in leisure markets continue to outperform with drive-to destinations, such as South Florida, Charleston and Orlando, benefiting from pent-up leisure demand and an extended spring break in March, Hale said.

All markets are benefiting from incremental leisure demand, which drove up weekend occupancy in the quarter to 56.5%, "the highest of any quarter since the beginning of the pandemic," she said.

The company also saw an uptick in business transient and group demand during the quarter from small groups, such as sports teams, educational or training groups and weddings, Hale said. While still at low levels, this business allowed group revenues to double from the fourth quarter.

RLJ also saw an increase of 27% in corporate demand from the fourth quarter, which "was a contributing factor to the sequential improvement in our weekday demand trends from last quarter," she said.

Corporate demand is largely concentrated from local and regional industries such as insurance, healthcare and government.

As the pace of demand has improved, average daily rate at RLJ's owned properties has also improved, Hale said, adding that she's "encouraged to see the relationship between demand and pricing holds."

"For example, the nearly 19-point increase in occupancy at our open hotels from January through March was accompanied by nearly 12% growth in ADR, resulting in [revenue per available room] growing by 69% during this period," she said.

Occupancy decreased 29% year over year to 43% in the first quarter, according to RLJ's earnings release. Revenue per available room declined 52.4% to $50.99 while ADR dropped 32.9% to $118.63.

As of press time, RLJ's stock was trading at $15.39, up 8.7% year to date. The New York Stock Exchange Composite was up 13.3% for the same period.