Sunstone Hotel Investors (SHO) 12 Nov 242024 Q3 Earnings call transcript

Good morning, ladies and gentlemen, and thank you for standing by. Welcome to the Sunstone Hotel Investors Third Quarter 2024 Earnings Call. [Operator Instructions] I would like to remind everyone that this conference is being recorded today, November 12, 2024, at 12:00 p.m. Eastern Time. I will now turn the presentation over to Mr. Officer. Financial Chief Reyes, Aaron Please go sir. ahead,

Thank operator. you,

our Before that that this I actual would results described are could materially SEC, remind everyone like to in those call including those to to and we with cause risks the which begin, subject uncertainties, filings from contains projected. differ forward-looking statements

caution to consider forward-looking you these our We statements. factors in evaluating

adjusted commentary financial FFO note that on level information, and adjusted also will non-GAAP this We contain adjusted including EBITDAre, property EBITDAre. call

providing accepted are with to as information prepared supplement We this a accounting information in accordance generally principles.

quarterly Additional website. details our the on in have our available Relations supplemental, Investor results and earnings which in are our release of provided section been

Springer, Operating and President Ostapovicz, Afterwards, our Chief and capital available discuss on Chris Bryan highlights with commentary earnings investment Officer; quarter transformation. for Officer. on our and call questions. operations a recent With team third update Bryan our us updated Andaz Giglia, activity Robert the Investment Chief start are quarter, including from some our trends. today us of the will summary of third off will our Chief your Officer; Robert be will remarks, our an finally, details After I And will outlook and and provide to share provide results answer XXXX. Miami Beach the Executive on

turn to Bryan. to over would Please call I the ahead. that, like With go

you, Thank morning, good everyone. Aaron, and

still deliver Maui. across number we backdrop, our on aspects and of leisure disruption multiple strategy. a an multiple stemming Despite market assets demand this, to successfully one the particularly events, quarter, largest on at navigated impacted which During of our the labor challenges managed weather of we from evolving

labor the our at October, As activity been update third the by impacted from in early we fourth San Hilton Bayfront. quarter noted Diego have and operations our in

with in one pleased and resumed of that the property, we is normal some is resulted quarter at that business our generally results disruption, both After portfolio spend cost which at at third line the rooms solid hotels earnings corporate our hotels controls, the ancillary adjusting Diego, growth group are properties. this offset at in While urban came and and have the across our operations in city. softer this San in expectations impact demand the in the transient short-term the leading as assets, at level, now revised resolved better revenue leisure solid for

continue on specifically performance. completed benefit call, our pace details Despite disruption, a XXXX, we in we move repositionings, activity more acquisitions, expected third easier multiple outlook, potential is about comparison citywide, from earnings we additional some recent improved drivers that, stronger to additional to of let's related to the before muted on review as the optimistic in near-term an group into be which some Diego. San commentary Later these share But will labor growth. quarter from our and

business we the quarter, strength in in sustained During activity further travel. recovery and group saw

While resorts. segment. again at with continued Starting moderate, leisure saw signs to the group encouraging Country our demand we Wine

Westin Washington, converted expectations Downtown customers. is attracting it by appealing broader to by post as and RevPAR and continues Our transient newly XX% of D.C. a performance total by our portfolio The higher-quality exceed grew led again conversion once to which was groups the RevPAR range XX%.

that which ADR by to third and [indiscernible] robust achieved the portfolio, across nearly In performance in which The added Diego, Index, in growth XXXX. from year-over-year quarter as convention average set Orlando a San was the to is hotel of increased San higher property Flag. XX% renaissance have our the achieved XX% at we we at Francisco, RevPAR combined nights the the hotel a room D.C. Westin transient Antonio strength this what degree in an renovated of speaks as under transformation rate in the than total led XX% hotel quarter, than turned daily the total in tailwinds Other San saw

third XX% last XX% rates, a more Orleans, higher we across nights growth at up Washington, production in Wailea, revenue. over Our including robust translating Wine Country, are improved into was XXXX booked year is with Francisco, quarter and portfolio, room Diego Even the seeing San group encouraging DC. pace that healthy group New San

pacing we up have range. today, improved low last double-digit with revenue sit XXXX group bookings since for in our As the quarter the now

by Trends improved strength once The quarter expectations Boston in Wharf further Portland. San X.X%. of again total took higher growth demand several and including rates solid a Long advantage RevPAR exceeded of group on of top third our points corporate travel over The in with in strong they of occupancy Marriott basis with Francisco hotel on XXX business base business. markets, increased the Boston, as

In demand occupancy than compared year occupancy by despite of has In in to stronger market. this group driving basis San Portland our Francisco, higher recovery challenged most more a Portland, see further years. been from transient is growing in pleased outperformed, were and both activity sign demand events. quarter amounts backdrop we transient midweek to recent on the as market XX and nearly points softer group with This last short-term an jumping XXX points encouraging

as than rate well our that received more up bookings, including group the with month. converted is up XXXX Marriott that to pace XX% index Beach, XX% than over more being and last is In strong compared Long newly is early transient

with rated in peers, seeing fourth investment the are against this benefit and hotel guests. the our as We hotel in quarter the of corporate its up ramps highest share the especially gains

tailwind forward XXXX. continuing this look through to We

the in the incremental ongoing we very to following we but which recent This Key normalization levels in been quarters. true still West, price in where rates in a have by moderated grew where particularly pricing. Beach, X%. robust demand our has pandemic, Leisure and grew seen sensitivity during further some was urban RevPAR healthy quarter, third ramping up hotel the quarter, Long Excluding portfolio witnessed

on discussed in Beach vacation Maui rates quarter. year. occupancy we demand subdued expected, resulting and As expectations last been than last softer below last more both the the following island to from came Resort, the on has our travel At environment call, fires Wailea

this muted activity is start increase begun of into in updated bookings an and the reflected we upcoming the the to While our see and carried more period have strong. in has quarter fourth guidance, level remains festive of

festive room in total XX% fact, higher growth into nights currently revenue pricing last period. translates while pacing for And In are has this X% year. still moderated, room the than

refresh, of the with rooms our more Looking market is underway now. further added the shows calendar, pace with lobby group ahead, of and event in a improvement group constructive driving benefit strong XXXX, signs which and

our parts the quarter portfolio, third some provided encouraging data other resort of points. In more

total Country RevPAR Seasons RevPAR buyouts, event resorts expansion. significant Wine third by are customers comping despite over XX% Our group Valley in year. occurred Healdsburg benefited which leisure and translated that buyout grew attracting of continue points and X% over quarter in to into from Montage Four the resort Napa margin in nearly events. XX by multiple a prior more the season high-quality grew

continues focus making be and of to we Our the volume Andaz Beach. at managing Miami, both Miami In business of these resorts are while the transformation on work more on progress. continues expenses, driving

that additional and for events project by impacted time the line extended our permitting has multiple inspections, weather needed Florida several time recent combined However, months in with weeks.

result be investment one delay we meaningful will the a are terrific creation project, will for that Despite this asset and this shareholders. that incremental our value confident in some and for

expectations. is As will completing deliver on well our the but nicely, focus share to the together we that stages, positioned positioning is to contribute full the is Robert in renovation renovation is now our earnings. on are resort final property coming additional the confident shortly, some and the details to the and XXXX meaningfully resort our

million nearly start the stock stock. to Since million arise. of market This capacity just at we XXXX, brings of NAV. the repurchased and of $XX of to have $XXX $X.XX $XX an per capital repurchased quarter, average of market opportunities of over incremental estimates as to total our to During conditions sheet a the we we balance share, price million return and took advantage year-to-date shareholders have meaningful discount

the in it reflects being by encouraged the moderated, Aaron is will we factors, and confluence has that embedded discuss impacts Florida including portfolio, XXXX our impacted growth from impacted portfolio. estimates and guidance initial activity short-term more labor assets, for backdrop. in the long-term disruption outlook have our short-term from shortly, our about to our lingering we San the severe a have potential leisure exceeded weather that muted impacts several of While remain that Diego The

setup be our outlook the very about near-term most should among the attractive which year, softer in for excited a Despite XXXX, we current sector. remain for the

Long and execute returning healthy capital Wailea earnings an value capital, meantime, objectives: should the on and thoughtfully New X drive Wine production our top to and remains in will we layering our impressive calendars, and these Country, investing strong we XXXX. and of with citywide Francisco, come. expect impact In of Our many years shareholders, incremental markets the the of continue strategic and that, lead all Orleans on and portfolio to at in combined group growth to our pace Andaz in better San to group Beach recycling

our that, with and for to And thoughts go please updated renovation Robert the Miami to expectations turn I'll give Andaz ahead. activity Robert, the some Beach. additional call on over

Bryan. Thanks,

the on value-enhancing During quarter, projects. additional progress made we several

earlier, noted Marriott Long Beach the recently Downtown. work rebranded we at we As completed

take now XXXX year. JW the the one product for the drivers and Marriott, set We of to fourth finishing hosting being group a to our of Bowl. meetings with advantage we quarter the meeting added next on finished the at In of our calendar is of strong New are of renovation benefit Orleans, quite and a pleased the look of in the pace put which touches forward growth Super several with space busy hotel

been rooms the disappointing, we efficiently environment soft have through underway and are demand resort. in the more renovation the at softer Wailea the move While goods using to has lobby opportunity we refresh

meaningful around performing and do the anticipate disruption. be will We not remaining any peak work period

to have pieces. While Miami comprehensive Andaz the in and Confidante moving it progress many with the transformation project a Beach, is made we complex substantial of

have as and of the delays now XX with year, anticipate process construction, Given result about a later debuting some you. extended we of the of weather of resort last pace shared we next an permitting in repositioned municipal what the experienced February we that than impacted days

The the renovation million our of now inflation total incentives the working net primarily The result initial to some possible and deliver growth enhancement we of cost $XX XXXX. we investment above reopen resort and million. incremental transformed in scope $XX estimates, are the is be longer investment additional is addition, to with of approximately team expect In some project will the to as the as quickly time solid spend associated able line. complete entire ensure

to I'll Aaron. And call. over Please forward next the on our ahead. that, look opening the to with resorts it bringing We go news of turn

Thanks, Robert.

by labor in impacted were Our quarter in activity San results the third Diego.

in noted revenue. our third the came lower control in weighed in we we As impact, earnings consistent generally headwind and with better revenue October, offset rooms provided After expectations from adjusting this activity for earnings. the on cost to helped early our operations update of benefit growth the as this quarter

Our Florida hotels. in an a in Bayfront, also some flat, Miami and Maui. Confidante excluding were X.X%. urban San was weather operating and quarterly partially challenged excluding was but Diego Hilton Beach most offset in of from growth, environment the country stronger-than-expected headwinds effectively increase from Wine These our results Comparable performance RevPAR the reflect at more of by

revised third million our included outlook in FFO year. morning quarter was for the earnings release this EBITDAre diluted $X.XX share approximately the for $XX our per with and Adjusted was

in employment bookings in have resulted October. noted that San some update estimate. incremental lingering impact operations normal And has in the been initial was has ratified operations, in Diego to our new we resumed the month, quarter fourth in earnings hotel As above while our there headwinds last contract a

environment the Florida robust Our leading period. the updated some less up from early Maui, impact reflects part weather to demand quarter and outlook in during the assumes also a the of festive in leisure

points. total to a generally together, and decline Taken a from as Miami RevPAR X.XX% the Confidante a vary compared is from basis which the expect includes our to year exclude decline we XXXX. and prior we will year of increase change, now X.XX% in to all be expected of an full points portfolio flat If decline of portfolio range that to of to basis the Beach, in XX RevPAR XX a range hotels

was point the reference guidance, portfolio Riverwalk $XXX for Miami year Hyatt Regency full XXXX ownership Antonio to total Beach, metric prior total RevPAR the for for prior As the the the was San excluding portfolio, $XXX. including RevPAR our Confidante year a and our

to adjusted we minimize Andaz our now share and for for which the of Including earnings will resort Based generate $XXX from efforts full on of revised $XXX included per range estimate revised in diluted revised our Beach will Miami that the year opening the million to less $X.XX. that from balance to current $X.XX we timing the while year, million range and work outlook the EBITDAre in FFO loss the year, will now of our the performed, guidance anticipate is is costs ranges. a adjusted

JW the existing December the continues anticipate strongest mortgage drawing $XXX our the of on million sector. full and into liquidity. New credit group Our a term in loan to the proceeds retain cash together pay one facility, secured most Subsequent balance capacity loan the the off of with quarter, draw loans lenders. We our balances, to to using of sheet Marriott by our of agreement delayed equates nearly with million early $XXX entered in total Orleans. a we the be end of maturing fully which, We the to

Following unencumbered have this offered capacity significant a with the sheet we portfolio will refinancing, flexibility. fully that additional and balance

After be giving We bank this until us, group loan. options XXXX. of to effect not will the support to on our continued our appreciate next extension maturity new available

return to on capital. shifting Now our

distribution a our that $X.XX together In our X activity Based year. Directors of for that anticipate of the our noted the authorized our dividend in first dividend satisfy Board on to repurchase quarter. we should this the Bryan share base for fourth the earlier, dividend share common has outlook, updated per quarters expected addition requirement with quarterly

the question. to authorized as can open the H to so that also Series Board participants G X I now with ahead. possible. yourself go distribution And many as dividend, to securities. you please speak has call able that routine preferred the limit our please common addition for to that, In with We and we we Operator, questions, ask are the

the [Operator line Bellisario Instructions] Michael from Baird. of Your first question comes with

what what just canceled I Can been Diego. you on focus had group quantify talking you want from then 'XX $XX maybe the Miami year. shake obviously, San EBITDA impacts, does can opening And I Miami, presumably, 'XX? million maybe in directionally Where early on and of that for there delayed XXXX you about to out that maybe lower might but to also first positive numbers? next quantify what transient, today, think do

Sure.

the both Again, a overall lot with noise of of the is third quarter. to and impact impact fourth San starting fourth obviously, in and quarter, cost quarter. So Diego, the cancellations confined

And since update from that so the we time during cost The was gave bit a October. of was inefficiencies didn't that that in additional And the little EBITDA thing only changed then is when some come in-house. cancellations that just expenses impact. the -- the time were run books and obviously more more period the period some hotel to and during given doesn't also closed fully some out, sorted very concessions efficiently were that there got groups of

that time. So operations at back our is normal we that when hotel at look the view 'XX, to is

will -- swings way is see with we'll and will We're So some that operating to in see X%. should obviously Pace the that year. close revenue some up there normalization at time. staffing positive about be for and strong hotel be -- we as full some next full expense

originally to looking the So San top $XX the with at weeks, $X Diego. of EBITDA should to this this good again, that we a million Miami, a $X million on back On few of pushed disruption are for opening year be year. about loss compared year million

the of one seasons Beginning is year there. high the of

EBITDA. million And impact couple is so of a dollars that probably of

And has $X from pretty a the the X about will loss going this and meaningful continue year-over-year ramp then negative to hotel for that the loss then the still year, [ maybe $XX from year. on ] of pickup million million GAAP So to full point.

question line next Dori Wells Our of comes Fargo. with from Kesten the

in that with Has cost? the your group follow-up, $XX double just And a stabilized up you yield Andaz? 'XX. expectations excluding Andaz pace, digits quick as changed Was cited at or million the revenue including new then

Dr.

said which of a total with extended overhead quarter. invested some for last of has results investment the the X% property time and were up the to we some more cost expectations a just bit of little going property. from that delays, was X% capital yield originally, on combination staying the scope. Obviously, So inflation, our costs -- which slightly period, our with in more

be in putting are the building up also world-class to are that have then done to world-class with that things building or multiple of asset make match addressed a And have -- buildings actually to with a built time time periods in unforeseen that come sure in [indiscernible] up. we that we There some different different periods.

is that to would with that the expectation that in a moves stays I range. little yield that down our within additional our So range -- there assume capital, that still it range. bit

that -- New have city-wides quite looking noise. on [indiscernible] And that also. that San year, picking growth different we And Orleans, our that, at Montage exclude does Andaz, really XXXX very pace, year Orlando hotels a in Francisco the it is look has next we'll driving San of pace and are because we create have then next great then pace year the Diego strong And top XXXX, of for at then year exclude and next up. would then when bit next

question Our Research. with Ketan Carl Wolfe comes from next

a bit. I to I into NAP dive guess wanted just your assets

improving? wondering strategic ] opportunity better it's recycle asset here what Just the to the given capital is is and [ opportunity the a if actually performance

line question great we've said. and No, with in what

assets a for that had there buyouts. quarter. Montage fire strong gives see to us these them it group productive to It starting strong several of stabilized. a was they And very on it you cylinders get And -- gives are to assets, both a as opportunity both. is an focus Our quarter all means for these really to ramp quarter up. closer group

obviously had that performance. participating. in are repeat, Montage, online helps last the year the backfill we've buyouts good that this the of amount customers. transient XX Four able always XX residences, was with don't residences, to Also And buyouts come the but Seasons year. a Of had

months. next up to expect more the pick XX We over one or

And we also so year, performance. that's contributing as into the And pace. next have great to look we

pace have at We great Montage.

them rooms a now is in while of in the we next generate. both transient we we spend is on Four both these well Seasons, get demand and hotels That down. our that -- design And into going because by to are p So way, better good are market. occupied back ancillary more in these comes the as pace it's that and more definitely be, is that to of have get assets taken come where Seasons, rage want probably our continues believe We can Four to to of while the to market growth. there's growth the leg up

get have and mix, them XX%, set We managers the just now the around them which we're XX% probably around cost Four closer XX%, standpoint. Seasons to working from is to for a probably about XX%. right today. today. And Montage it's We're with to group XX%

right of and need too. part a of -- upside the weigh in your portion these question monetization and we right answer of what realize And will to the moving last can everything value ultimately that is and So a good we direction to it just realize the in and that then is the is, when time that result assets. yes,

acquisition these holds. point some and of now that's where that them determine So recycle said maybe at is other hotels our them the with would is, to recycle eventually than we look tasked of we're as But sooner what that we to --

next the We'll move to on question.

Citi. comes question next Rose from line Smedes of with Our the

of actually, kind do a you I wanted maybe to ask question. well, wanted twofold to -- I

that on expectations of asset your what I question XXXX, worth into in for Just you it's for. asset assets. for potential maybe incremental think it XXXX do to Antonio, to them you think the as Country Do think sell rate contribution. than more the Wine running felt the you about follow quickly I at of you purchased you you that more that than run sale or ahead could you like thought of EBITDA could looks of . Do ask But you for them extrapolating initial where up kind you're wanted as well San from year? million -- $XX next that your other

think our assets, get realize bit quite we Napa, be on that's do us see where point, this on at paid talking potential then on we there. slightly wait in for and are path flow where to and right sale -- we we price cash not where that more that value. We Wine the At of Smedes, we both depend be much whether Or is probably to good look, would upside get how we're today? a flow we're whether going to and now, little I Country them, a to cash a want basis. to below need to realize a basis --

give So performing sales very acquisition. and that's take is ahead, evaluating these happy with the with said, where the of we're well little we you a And redevelopment On in underway. assets. for with as line Alamo thought. the timing It's the San Antonio,

JW next we that -- we were happening in have there of same. and meeting quarter the New expectations in year, do light the are in able that's rooms, to think space. update probably and what the about in second renovation during quarter Orleans I the We third meeting JW get that third to quickly did similar summertime our

we sit our in investment. We that very in [ right and that site think I Visitor think next long-term in is retail Center. historic we on next our line, for that to where right garage building the have and but are year, happy the 'XX, this opportunities our is here combined now San reopening are when ] Center pretty Antonio Alamo in and with full in with Telmo expectation So meaningful we the floor the opportunities ground have

from question ISI. with comes next Evercore Duane Our Pfennigwerth

about you since little of called relief in remind what your out could ago. Maybe you if that the And -- that there the that when month does effectively drove one in talk Maui change could as that's did relief and guidance more revision comparisons? us, bit items when shifted did X You the any off? you business a business roll business about have Maui

Duane.

the we in And didn't seeing on and in was Okay. time provide October, labor But becuse it not the Diego. to into that at was that that portfolio did and confined San at QX, And that. QX when and that anything underperform the purely quarter were else update where up continues impact We closing everything we QX. was Maui update. continued did within still into in the

just this Overall, firing a look across And you all general market when some portfolio, leisure group cylinders. of pickup has than the in been our slower on other markets. the is

other has a year. no over Our lapped -- more business like And sensitive in rate Wine seeing and last on there, transient Leisure Key kind hit but that is doing couple fully the quarters. Country little where we last bit struggled over promising In and of well. a become there, Maui relief it's is West, is occupancy we're rate Maui, it's very the market. very There results. of miss is markets, business

And so is that picks positive up strong and next that's in Maui The now. not a of seen up year. we've things. very that One group group couple picks impacting anything

then 'XX, off a for and years year. that's We have large in know there's just with island I fourth quarter, the group off-island [ about this talked we've ] X some Island D.C. and an before, but group on

Maui for help other fire. do putting been pace to looking and brands campaigns into promotional group to bring Hawaii money business very in distribution the our from to continue promote -- We're We're of for year. to that. So help The some getting is post next great has back channels strong there. state

or a over we've steadily recently and declined The flights airline biggest positive seen we've now. over down seen been for seats -- year is

where of actually seen month the we've December, switch. that For

so coming And West Maui. mainly Coast, about the market X%, for but and biggest flights feeder seats are up that's and from the

island. big And seen going the lift we positive a where so actually see more we've -- into that's

significantly, that is where And Festive gives things. December, I to the the to a Room is the spending rate strong. and and translated -- high One, fill hotel we've it fill opportunities. ancillary at very up. that allow down, few has month allow that's seen but think very it it nights to is festive do It of where upsell for that's hotel does hotel.

And top at layering as festive. Maui a lot so is gives that up going forward. next look Room very of year, for are up pace on more for optimism nights strong revenue total we and our us

Next Jefferies. question Katz from with David comes

maybe the really is? think but and sort right, of to find I'm -- it? with do looks I way double-clicking get was Or really we on new back, crystal curious trajectory ball? we all it think the whether you some what just the normal really if to what ask topic I we you point Maui, of get that where a can do that And like we to

Yes.

destination. we'll Okay. David, is leisure phenomenal a crystal this look into the ball here. Maui is

the and for of time. call are that Following period half Kaanapali island, canceling. out get [indiscernible] [indiscernible] were so the of impaired component your groups the a fire, it, -- leisure of half there,

sourced. were being residents had other being while hotels, put You in up accommodations those

And stay. that not is kilter. in Kaanapali. And places to the and stays so it's exactly travel the Wailea cadence customer same off through the in the of And up customer island normal

the shifting with so absolutely not back back And that's demand airlift to the getting improving, here. now is normal an and group issue

funnel year but We compared the XX seen levels quarter good good last second years. the not 'XX, of or we've the amount and are quarter, continue third last and not in funnel the to specifically very only the from have over Maui production, a of and to strong rest production portfolio the group that only but

and so specifically, -- and that's And Maui. for the entire specifically portfolio

the it look but X doesn't, saw when years to good have the process, to for that when out it's are experience look No, to future going we island of airlift all different and don't pretty at going in look And to highly enhance the change desirable that's think from what will because and you domestic rest are we I'm -- is been usually that expecting have leisure Maui I is island. snap and the destinations -- now, a a comes I before So only decades. we traveler the see when Maui. it luxury similar through year, a rebuilding back? out as major see

Appreciate it. . helpful. really That's

Darling question Street. with next Chris from Our comes Green

you think similar on next your the a as you the either at project look And with or perhaps think new or Aaron?. to portfolio. your Brian, extent about net step what priorities acquisitions net capital do days acquirer out curve be allocation you existing to risk then renovation year, within the What's for you'll these seller. appetite a you next do to

standpoint, invest our capital -- approach where I allocation for a overall to strategy in, our think I throughout we we balanced an doesn't acquisition change. continue think redeploy look opportunities we And I either capital those, look portfolio we have From to harvest then and or portfolio employ we look for through our right? our mean through to for repurchase. share to opportunities throughout once opportunities

in a space, I is our very become fluid we've think this And accustomed is very to all process.

we're we teens when return. the we're view portfolio, you if renovation, somewhere kind doing it so And in in our be that at if -- of different look investing the at look the is should the components,

is at the what kind XX% at south repurchasing we trading a of looking we're to at. that acquisition then an would and XX% looking an shares on return acquisition. vary on are probably that, And our be You is price of that's based the going

we it's looks Antonio pretty in point for that time that allocation, up like I are. we investment have and that's the And future deployment what balanced San think then in from share on higher EBITDA and on lift. and it. its yield the So is returns best the when a at being better now. and in I where just in it landscape -- renaissance, And rate, the that better we asset that not the made look market opportunities because the okay? think is to allocating to XXX% us seeing power charge so it, it point, providing. better I you now a and And when been we've we spectrum XXXs for index -- really RevPAR it to based that price have this a we and that look we the that's like D.C. -- producing it's getting you brand with like meaningful that did at the changed acquired just we as used a of that's earnings a indexed product now be you taking distribution doing. and able And a Westin be it's the look when

And overall and portfolio the asset so do. always those. to But if hopefully, of find portfolio don't, like time it's to have size we'll But deploy. sources recycle value. we mine the at of those to something the of the to that we the those opportunities to are into in And impact we that portfolio be the allocate have and mindful then to to we'll as one the look continue other

of Stephen comes question from line Grambling Stanley. the next with Our Morgan

related any or down somewhat proposed wages before may policies the follow-up. containment a as otherwise? Moving about by by could And P&L perhaps thinking over you're inflation next the is wage any business, have but differences I missed market? think administration cost are being do But new this, considering there as are that. there And impact where you year? measures either the that any running

Stephen. Yes.

expectation think still last a know little spectrum, too as is spectrum. it down of might bit remains to as view but least now, kind within what saying and for wages a that other far think early probably move a in little at we And that of I policies well be. on range My over that to been the we've I as our impact X% maybe changes near -- sort over that that term, while a year, X%. to for started the

based And finished just Hilton being so of there our and at -- employees up. that with -- Diego, But in wrapped we'll Hilton San we or are are just wait see. being being process their union and negotiated on to the other have many contracts

is X think we're within we where about. I well range ended that that up talking

expect near wouldn't to term. push I . so And over anything higher the

your that anything you've got there? on And election I follow-up guess eye the administration, the on

items No. about we're before we'll think to to there's -- -- from see to lot changes. to to I what SEC actually speculate mean of that's or ranging going to but be we labor difference have be any can start items, obviously have going a watching from happens --

next Our Chris Deutsche comes question Woronka Bank. from with

services the that. and are the the and Is -- in Seasons. kind the nature like structural I improve is if good the on there of that get feel to guys progress can or of is Seasons, we unique margin and in structure you your what certain than you whether XX Is at small. you you've it's terms anything have very But the like average On groups everything know . do to a I It's the look brand we -- [indiscernible] it's guess said much willing buyouts -- see out property. just do property. or It's rooms. margins? staffing It's and Four I that of more maxed just smaller differences that level. Or there can offered Four way, of or understand to quarter, in brand do do the the

a it's Chris, we above, occupancy. little definitely but more the of bit need all of

to strong will but enough. in spend happy where get rationalized think there we've the with make we're get and at in is occupancy they happy rate the the The I sure the to is, periods time the that rate rate move, certain there. total they've -- actually that rate we're

at back recently of really our on the you made was the that just process -- now. manager thoughts of a recall, to and same that impact On some over changes lot Four year, we and through and work them seeing the they look Seasons implemented cost have side, went was And a cost structure. we and And at and and Montage strides, last with other where you're go they then if us. brought that X, the and P&L the with other went Phase great

are there make to are or experience. that the as components as sure efficiently doing are manager want that the or remain a There see we things is And those certain And while really that ever make luxury the that other doesn't that guest value. it notice things have sure that possible. to to is things we maximize and

went in the efficiency of hard see lot start a you quarters you in and the little So expect forward. when should to have QX, seeing it in A that moving to especially that those buyout a come that in and they've and been those out and they're the been and in one not But process steps of implemented, quarter taken going now. have forward, already other.

Compass Our final with question from Dijkum for Van comes Floris Point. today

So -- the well, I how this San drive you sort what hotel. your particular, have is the But were Antonio ancillary X retail you things an could referring the forward? And going you opportunity, of of much ancillary of revenues? my portfolio, this opportunity of in attention in Bryan. think revenue The caught to where Riverwalk today think potential this indicated, billboards, that as do could you you terms in do

Yes.

think with billboards the experience most because all of certain Antonio, this we've I had San the portfolio is and probably in type regulations. difficult building in or of just past our

which redeveloped is the to street And retail. for a our And it's retail lot. being it end there's that on then billboard river is so the the [ now, that portfolio that some in Antonio ] ground have floor again, is know -- center. It's the is there because level, if that what entrance of and just that there's unique walk on is to if level, through it entrance some the to walk the it's have level And of but can don't how be the the floor, bottom really has be. also the us, -- have to a -- retail. Alamo billboards opportunity, then each because hotel, at which those -- lobby amount right lucrative And . San advantage not will that the we now second then of been side. the structure we I has is would for was a the, is taken parking we next a know of

probably this mine in value there's for incremental hundreds an But our hotel say creation nothing we've it's while of pickup, well. the the I portfolio, and have are there the meaningful wouldn't rest So that pretty to in opportunity dollars existing of -- portfolio scale of of talking the -- here, think is which throughout we we're good I thousands incremental.

not development be some throughout doesn't other. lodging opportunities it combination and retail have mean where we land, Now excess portfolio of a which that could there's our

the still We a ago. So addition There's throughout term that ballroom ability to additional in things both those have we put in the portfolio. keys assets. mining Orlando are are certain years several

on. working still we're stuff that's So

we have that, And will it our share on updates with when we investors.

to call remarks. Chief Officer, turn over I for the Executive right. will Bryan now back All Giglia, closing

at with you. We the Thank interest. . Thank look your upcoming meeting you, to you of conferences. everyone, forward for many

Thank you, everyone. That concludes today's call.

may disconnect. You now