If you thought the lodging and hospitality industry would hit the brakes amid a consumer pullback and a generally more sluggish economy, you may be in the wrong room. That's the takeaway from the latest results from Host Hotels (NYSE:HST), the nation's largest lodging real estate investment trust (REIT).

For the quarter ended Sept. 7, 2007, Host's funds from operations (FFO), a key financial measure for REITs, rose 38% to $210, from $152 a year ago. Host earned $0.38 per share, compared to $0.28 in the year-ago period; analysts apparently had expected $0.33.

Looking ahead (and despite all sorts of qualifiers about the company being "in the preliminary stages of its budget process for 2008"), management appears to anticipate that RevPAR (revenue per available room) will increase by about 5%-8% for the year.

Host's results will be followed by such other hospitality REITs as Sunstone (NYSE:SHO) and Ashford (NYSE:AHT), both of which will report during the last days of October or early November. Hotel company Marriott (NYSE:MAR) released its results last week, reporting a 7% income drop from lower timeshare profits and a higher tax rate. However, Marriott said it doesn't anticipate a meaningful downturn in lodging anytime soon. Choice Hotels (NYSE:CHH) andHilton (NYSE:HLT), two other corporate hoteliers, will add their results and observations to the mix later this month.

With REITs increasingly ently under fire as inappropriate investments, amid housing woes and increasingly crunched credit, Host Hotels has demonstrated that some REITs do remain highly attractive. And while the company's share price has bounced around during the past year, and remains close to its October 2006 levels, those investors who understand REITs and stand to benefit from their advantages would do well to keep this company in mind.

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