Pebblebrook Hotel Trust (PEB) 31 Jul 202020 Q2 Earnings call transcript

Greetings and welcome to the Pebblebrook Hotel Trust Second Quarter Earnings Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Raymond Martz, Chief Financial Officer. you. Thank ahead. go Please

and earnings everyone. call Donna, second to quarter XXXX and good you, Welcome morning, our Thank webcast.

our from reminder we Joining our those me XX-K forward-looking uncertainties, statements make and a statements before And securities are risks and materially are results Chairman Bortz, other could The filings. today. SEC later. of today only in quick as we future start, these by and for of XX, Chief under And implied as forward-looking no undertake comments today today, update XXXX Executive Officer. our considered is duty we effective that today them that comments many our Jon July differ subject laws. numerous statements our federal But and to XXXX, described are to

You which our we pebblebrookhotels.com. release, and contain financial our on reconciliations our can earnings measures SEC non-GAAP at website use, the find reports of

from most hotel within the challenging occupancies we continued government and in positive So market to mid-April the We appear. On increase weeks, demand see our Unfortunately, due clearly to in improved up beginning note, marking end travel share history public. the bottomed we from had place protect hotels and gradual of city the and opened flattened virus leisure, have the their to as some open. the the rollback of due in of primarily slow X restrictions and the recent travel the is ramp just seem business a a of state of health the put when have now general the of though second XX out clearly the of demand. have recovery try significant of few smattering open, the March portfolio and travel second some business pandemic spread the demand in newly hotels over the hotels the spread to consistently and the to and last quarter and to The was growth and slowly hotel improvements hotel during quarter. with week-to-week virus the the reopenings, of a to

in to open setbacks don't reopening assuming another we expect We X from hotels any August, reversing further experience phases. their cities

to a travel that demand, monthly hotel As first at and and leisure $XX the all cash quarter burn the than is million averaged closed. we better our midpoint scenario million hotel cash worst-case burn $XX which hotels call, average million for these which result of $XX.X of estimated about the improving reopenings during represented June assumed hotel million, May monthly were $X our our and

includes to currently be burn $XX our our first our total This combined $XX.X June which $X $XX to we burn for from payments. hotel million to million our be hotel and $XX to average down that the $XX on monthly May July and cash on million, Our million, interest cash dividend at open, million was million cash are is burn cash hotels quarter and monthly for estimated average corporate we Based burn level all million estimate million. midpoint $XX to the $X XX call. and combined

Our profitability. our continues returning reducing focus be to to and burn cash on

were impact the reduced XX.X% total below since the $XX.X level revenues quarter, the million million, expenses by which of from second XX.X% prior pandemic total the of were started, year first second which hotel year prior $XX.X with period, quarter. the For represents quarter full

challenging expenses good in quarter has cut We operating the were can Excluding can been results ground fixed operating what insurance taxes, as XX.X%. expenses, feel experienced. relative about property and as we most operating as such these we've by ever rent,

great reducing a and did both job the expenses teams suspended operating at opened hotel the hotels. hotels Our

previously with the opened, May levels, in worth, X with $X.X operating what gradual and hotels hotels opening the during improvement million million end a $XX.X performance, hotels just of in a albeit X quarter in some with For June. revenue slow opened, June our before and April opened, portfolio in low unimaginably with days it's evidencing generated $X.X few of million XX

EBITDA million negative improvement hotel low million with year May hotel incremental second a was was $XXX.X improved incredible. and the $XX.X in negative Same-property in June. $XX.X period; in million the quarter, and quarter, in should hotel point $XX.X to For same-property the from a which an EBITDA compared June. positive negative show prior in July's was $XX.X EBITDA April, negative million million

due resorts X losses in April bright and leisure portfolio to don't our the resort the to at following June up generated their their August, weekly a and severe. last drive-to last daily $X.X recent spot become climbing hotel should June rates for been more million be XX.X%, demand Our ending resorts, obvious EBITDA Average EBITDA of operating appeal which week and XX.X% the over positive year Sunday. our in in in for locations, to by restrictions have most higher assuming were during governmental with July occupancies May.

XX% about at of business As with leisure group about a has transient XX%. transient for our historically -- portfolio-wide reminder, and at XX% accounted demand,

$XXX.X EBITDA year's million EBITDA Last negative period. $XX.X was prior we $X.X include hotels in sold. compared from since a numbers have year million the adjusted positive Our with million of

in projects. positive suspending the downturn million don't the have also million Parc transformational associated us In of access West Le the renovated Rook been luxury FFO excellent to period. in D.C.; Zena, a previous portfolio. with Diego independent last an $XX With Resort to our Bay the additional the share This competitive Adjusted with over Hotel of related to dramatic of into advantage been we of include Donovan with projects. redeveloping $XX.X & balance who Hotel San have renovation upgrade recently the redevelopment hotels Chaminade over Hollywood; to resort; Diego per employees Washington, reinvest current and furloughing redevelopment the for year a These share portfolio majority the Viceroy Washington, San one-time capital with will vast years, renovated redeveloped per and completed primarily projects currently or major million quarter, Hilton into that XX into our our Hotel declined million have which the charges to highlights a comprehensive invest of We either reflects and Mission negative to $X.XX this $XX Resort's renovations, million D.C.; the hotel-level X and haven't prior Mason into Our the $XX year, invested other $X.X year's hotel for of this to owners operations. a year's quarter a $X.XX provide hotels complete redevelopment capital. of luxurious Resort. into expect condition this transformation compared a reinvestment or XX compared our

acquisition we've none sales, $XXX the we prior any Station requirements $XX to infrastructure the transact in for $X ability to earlier of our $XXX,XXX you sales complete which desirability closing As our hotels liquidity. this sales in improvement our completed taken There re-disposition corporate Year-to-date, our approximately per the significantly and saw required also totaling completed debt these XX equates of property delighted when enhances further was This sale our X.X% $X the as have in room. from highlights week, at Nashville million another current $X we of a of proceeds $X.X challenging would million sale XXXX, acquisition and corporate for November to to the with repairs [ph] liquidity. environment. part since generated our eliminate million and million, Union And completed strategic the plan, purchased We're of used LaSalle individual to the we've of of million rate. hotel, billion property Moreover, which to cap which the the performance. out markets. enhance given PIP were

which next are of additional $X.X proceeds enhanced we're investment sale until of XXXX. assuming on of of waiver sales needs, XXXX, capital million Wednesday. the the a -- an to million $XXX credit continues have no and our million our and which replacement $XXX million net value you on is cash-on-hand, carry into of new debt, and needed. of facility unsecured, net to and of waiver of We our and transacted the our November of will quarter XX%, financings $XXX.X raise complete June, we is maturities approximately good the maturity, if or estimated should unsecured our the liquidity XX. total the period include completed in and maturities, of agreements $XXX hotel asset successfully book debt know, June sheet. debt all future, operating debt cost XX% rate November $XX debt liquidity Station any X.X%. of banks had far and from quarter in a At XXXX, maturing do available implies our million had beyond, cost third on which which of $XX This have depreciated of less of which level the debt. with into assets on which numbers securing our debt of depending shape we Also, recovery into Overall, was just-completed don't not Turning billion additional balance property in than portfolio. proceeds the we XXX% ongoing Union to through debt covenant Nashville, our XXXX. our and us These of unsecured, for relaxed is equates our period million as and meaningful for XXXX we interest pace flexibility we debt And second This effective at the of of end

as to we addition, reinvestment that, waiver the with acquisitions other call and about talk to And well the would as like can turn the projects I Jon investments, period. to capital other quarter. opportunistic over make during In now

Thanks, Ray.

repeating uncertainty, frankly, effectively today. times. eliminated industry and damage business. was level by how and hotel be travel-related never would industries having travel, much the what long since our been Those as comments pandemic. with and would this start impact the at really in time the to and, the guess I'd now demand our with key long-term impact the have many human to progress continue all last, cause deal These would on Travel thought unprecedented has behavior started business Unknown before the best future, lodging of would it explain thoughts how world. in it same relevant I unfortunately generally from So the and and are around the how all the over the are economy, We quarter's to comments, observations they help last our near of obvious.

assumption that last the conclusion negative our our period significant under impact a on efforts of the would protecting time. So was focus business the for

the for do everything worst, can achieve we plan So to the best.

But Leisure the quarters month, and not the year fourth We hardest provide second so slow expect to the anytime group solution. by of the ability improvement. would it, likely most the We be return most dictated than difficult. recover of that and thought thought be transient the for would worst for should to virus an it and recovery the predictions We part and the without effective first believe disruption would third a city-wides. quarter, than year. health with be larger would would be be the would worst this segments better business transient, demand small groups, groups, extremely the hit, would but we April significant that and the be world's than mitigate quarter being positive

plan even indicated In willing most health books the how gatherings We and the restrictions require and large requirements advances were groups on congregate with would individuals when would staff materialize, And being moderate. that like government in if our state be allowed. local large other and distancing to on of counseled governments likely uncertain gatherings mass and and would physical we property that accordingly. before allowed, significant none assume to fact, indicated we should And group that they would teams testing.

travel international demand the where We travel also very critical travel, businesses, and might of others, expect return, we only the to likely one of rest be with particularly year. would is and we be were We levels, to cautious the the small modest thought expected for that business, exception. be travel to consultants eliminating service be leisure biggest resorts be the and from And minimal more resorts. providers, their would vendors, though drive-to businesses, beneficiaries, the segment the at domestic convinced companies to most

or they operated believe only reopen could thought be We were lose to to strategic would and upon or recover be there was stay cost would during to of than cleaning protect to to We said no staff, demand amenities, different reductions enhanced expected housekeeping maintain covered at slowly, our also our substantial very We would guests, did and reopen protocols be less time otherwise. would money and one and properties our to sales industry-wide remain certification including associates thought a of hotel operations substantially we reason in-room and if because services demand models. developed protocols hotel staffing based hotels these a when they elimination and and in guest's the be the hurry new we an this with and closed. by

has people or personal care the developing participate an vaccinated population or options health as is were vast as be work simplified substantially either costs. cross-training, do by would to minor and preceding months necessary treatment seem successful reduce ago. relevant job-sharing they And observations expect the our even today needed. more is outcomes, vaccine and often what be in hotel expected solutions shifts mitigate These or of effective business that more either as health to to We beverage managers, improvement is society so and developed to relatively our clearer X food as exist, there is mitigate in. dramatic if be travel to that to make willing global sacrifices become should continues and uncertainty any willing we majority Meaning, in significant society willing to must until is not the our that contagion, the while

some provide We that is are, some operating or think number results based with and have data by being of tested you however, July, we and the of vaccines on developed on the I thought so disclosed that the very least and based also pace important months, potential perspective including provide key last data. early at encouraged and been far. couple what I'd

that indicative either performance the First end the kind of of what and of the from stating at even June this of obvious, that of or away And in stabilized improvement government-imposed or room urban that did any not most can than since June was is did early reopened our we quickly, return June many June, can June. leisure pandemic midst pretty really case the tripled of of hotels from see did our travel for properties and despite May. as more as some restrictions, occupancy up take is our the modestly so end in But revenues well. we pick total resorts which in May the with our

XX% we last As way down to July, June in year, encouraging. June. another room obviously, below down plus In yet look room compared but we total, being to These year, approximately they're to we year. revenues from over information preliminary versus go in total last are at revenues are this month at still XX% July last still for at point, from the XX% increasing look and have most looking of numbers

that our to at good are at an occupancy a Resort all driving even a true take. a a not XX in were open considering effort $XXX, be are numbers, created really levels. efficiencies average $XXX operating urban which our just around should ADR a team we're in we're with to operations, This currently us with or or just above address management X occupancy our ADR resorts around that property July, and considered. for new our property our improved of much at July. more Friday, $XXX, dramatically occupancy little or encouraging end occupancy for last such around ADR are is which rate the each XX% open demand zero-based hotels. level. models things X than these our operators. asset last For the July between lower Resorts excluding bad a and should higher comparison, open of XX% What's the budgeting estimating and opened year's literally so numbers low XX% hotels roughly These give was of ADR, better the at By is or occupancy hotels XX% for an tad all really

currently For level, open improve. EBITDA occupancy loss which of at properties hotels, I that estimating our average would will And and to million. up open we reopening, July, a XX as XX% more hotels, our from breakeven run EBITDA somewhere and we're should as between performance said $X the open currently we ramp hotel expect

money said remaining hotels additional couple what And point. focus we next demand hotels it including dictates to cash reopen quarter is As to Copley by of relates we continues X return be forecast timing lower our this hard at can X burn ultimately we only a to reopenings, to that is markets very our And the as weeks, to less as large, beyond the are lose our to of That weeks when the profitability. open currently XXX-room only allow But and the guide. to last another closed. away Westin and is as over open planning our Boston. stated, than in

for begins expect process, is wouldn't additional everything a we and over contract Regardless, to room like to X continue either should hunting the or Both semester. the doing or these this nontraditional this business $X.X properties our for process. lower to over to by the students burn some cash last which And taken these otherwise be allow end recovers. have cash we and house we that situations. million burn month. in X X, EBITDA continue most for And next hotels. which with different months which hotels of contracts Boston our pursued the at X also to through be different pursue airline X extended on help contracts as in combined executed achieve a reduce We've potentially luck could should of breakeven large XX,XXX Combined, for businesses number area, travel they'll should due we we're in crews, fall to and the airline winter turn of year. likely We further X separate business, we've to month be nights a believe successfully financially next both of for our the for these previously gradual including which can XXXX accelerate to other significant at year least rates. a slow positive semester, into But also colleges basis, properties had reduce attractive just represent

Over better be the point and hotels happens hotels next and generally, outperform our Similar before and hotels markets. to few early this last the are in only contract condition locations with lower in did years, and because high-quality expect able good to to price our hotels year successful we pandemic very truck. markets. our condition. than Being are would our down of business compete most year and dip And what good with in their competitors in of our they

few competitors XX last will of said, advantage the widening the over a XXXX. their to already Ray out redevelopments have. are properties years of lack years, hotels big private to come, X to in the in our years. capital have maintain be or few past likely months advantage we sector Many This next transformations our the undergone just in renovations, and just XX of As more major the XX X in

conditions with base. hotel the expect will We rule customer

because many And the outperform the leisure, something see to about that that in also with and our the looking opened. customers, lowers have of hotels anxiety this we lifestyle their feel focus expect for already We travel. we now experiential recovery stress hotels for particularly

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acquire expect As we years over and due look opportunities large also of a the many we back and cash-strapped that lenders. will will to the forward to properties from crisis, potential to distress the be in few next upside owners go over-levered at there number properties significant

X recession. XXXX end the Our of prior great the tail Pebblebrook through of in team has late during crisis-driven opportunistic the creation periods, been including

assemble we attractive that crisis, resorts and aggressively had and fairly prices unique upside that to quickly hotels substantial were Following of a also at opportunities. able high-quality very portfolio

more and Given and industry, our reputation the and our believe unique our opportunities the transformation our redevelopments the buyers, in competitive high-profile than next arise in majority have significant advantages and operate over vast we'll efficiently our strength ability as few to years. properties owners of capabilities we positive

of about the will lack Finally, we territory an future play almost ourselves clarity how out. to it's find safe say in uncharted with all complete

to move supported during the will combined you proceed to your an the a may confident now reputation, management foresight, to upcycle. record, not portfolio, only with with recovery team, team's thrive and by grind to we'd but on Q&A. creativity, liquidity incredible questions. next challenge, our all ethic, through strong track like experience, continue With that senior fantastic current be us We allow that, the Donna, work the and

is [Operator Evercore. Instructions] Hightower of coming first Rich from Our question

question a an would the few into factor maybe the So sort cash And is say the of receivables, that? managing how and capital how payables on over working categories that And months? year-end? last cash thing, terms in those burn within but analysis? and immaterial this does of you any Are sustainable place should those -- about that took that think changes through Or we burn.

Yes.

what provide to generally, So and a cash out? to burn is level. our statement. trying trying We're hotel when at the make cash isolate look we in What's we're -- true one cash on is the this not really flow

out So terms outs items We're those and to down all taxes we're like the the ins property rate current gear trying to that and are numbers. drawing lumpy, run what that. trying those even based of that not in on

the that last not not benefited in not over we're some -- to That's just us down, or of you days, That's any our an come So drawing there. cash the actually as to trying factor our AR example. but reflected into going XX saw we're estimates. down incorporated ARS was burn pluses benefits of on that additional as

now What's on corporately? trying we're going-forward on really a and So does on happening side. it at What's hotel happening do? What's the happening sustainable out, side? look What to in the cash intra it basis. a on

So we that's factor in. how that

it. Got Okay.

flow cash of thing? So from said, accrual-based it's it statement, an sort like of analysis that more than, the you picking

it's now, a it's hybrid. I more of -- say a Well, would

cash the taxes and yes, accrual. so lumpier hotel that's insurance, property things, So out. the GOP, down like on But operating coming through on those in it's really side, and more on

And favorable because, at even washes sort part, Rich, being the little of build most without you capital, business, your AR. frankly, to time transient in I the or think, of of I transaction. don't it a might out the think most for as paid it it group working With be much much relates

flow. problematic it's your working impacts that from negatively that perspective to a build have you cash it's So capital. your little -- -- buildup not That up

for And second guys. Got my Okay. That's then here. it. one helpful,

permanent the and of we In just what hotels as workforce past any have anything are days? able up, you those to in from of then that about Or there sense? that percentage terms tell attrition furloughed in in reopening difficulties along become think And are employees, those XX the us, layoffs lines. might come staffing

Yes.

I ramping the at some combined the have back benefits, we've family with people either coupled care members given unemployment with might at at relates to people generous think challenges bringing up, as home that back it insurance risk. nature be of or the issues some with child had home, problems generational that

provide So come later cases, And come folks staff come if may we can been down throughout see some to do that per some portfolio. to people, prefer of needs list, much the back flexibility. But work where many would we've our had, to able in sort to back. the we decline -- I who say but we've pretty decline to back or

from Our Smedes coming of is question Rose Citi. next

business Back be to cost you now, recovers, of reductions putting -- ask have I place you're structure just the maybe and cost I of revenue kind assuming to, basis? point of sort that say, back be with levels? some in sort business sense change a of the overall we're of will wanted would margin as these you do what normal to a sort in Or... of XXXX, a permanent on

I It's that we're Smedes, be going that we be question, X, there's to a is, wants would to say no these speak to that but advantage technology technology. likelihood. can no managers that all use able will But -- anecdotally, answer. in X, where frankly, fewer more but normal and hourlies, customer take doubt properties and, of don't not can I people, what out know really it's years technology doubt operated there's good particularly and, I and with X in one where cases, the some

operations and perspective, be beverage So better. that I think food from efficient. I think will be also should more

that, and come in well. kitchen. programs as in recover should margins be likely we I to labor, to more side the of efficient. as department going food a ultimately back They're when group lower think we I that And to think that going result are on better be particularly different, the be they're be

the Okay. to just just -- reopening And wanted you, then you ask I mentioned lead. cop

I -- the that others. asset kind a of think some to as your maybe relative of of group more of

So I was to just at driving wondering kind reopen you point? of that decision what that's seeing are your this there

Sure.

So we rooms mid-December. Northeastern losses. the XXX attractive. of and hotel it -- for our terms University first And rooms. between in a rooms hotel end does, with signed from from shrinks mid-August what of It's the our of XX,XXX to well, financially just -- all, reducing shrinks it that it's desirable But XXX contract second,

what's And opportunity left previously. also becomes more profitable so a than

classes The Northeastern's piece going it. to meeting to compensating be is having space it us be going for also that they're utilizing of actually other

the probably So financially that's close. only reopen that the in is that to a only would -- thing more that be frankly, that us manner that's hotel would the staying allowed business have attractive -- than

coming question One Neil Our Capital of next Malkin is Securities. from

Maybe switching gears little a bit.

the maybe business in or hotels, Something or when that thing April, for the restrictions. potential brought ability to was getting given this was government-mandated make started claims shutdowns up really interruption bad, pretty

when sort offset of come update with there's wondering some government-mandated. to that, of some if help to any sort losses, Just particularly proceeds if have and you agreements shutdowns any are or potential to

expectations, things to just you a our in we there know, And and these coverage is, But you it dialogue as proceed do any that. certainly -- easy resolve. here, there we'll not updates, as Neil, needed. an with great that. we'll But make policy insurance options be and whatever there's But progress resolution make be and are we'll especially insurance The something is as apprised it if work and here. to any go if so keep through opportunity there. And are if easy. that we'll years angles manage it's that, have we're have multiple things quick we'll likely, opportunity, evaluate These to won't complicated, we then we through. your have great of Well, on And Sure. won't going evaluating you take that. material companies

pre-bookings opening, to I you're kind forward in do some open they're of if even don't your the waters. great. or or or gauge know Okay, that test plan -- on hotels, you bookings you of not

or about the of ascertain, hotels? you talked on give are than you of that could in kind can open have looked. trends you those opening August. -- Maybe on if hotels Based to potentially just that sort X how think you're curious, Just X a you you comment do demand trying more initial pre-booking

So...

Neil. Sure,

They we out So are that And months which interestingly, the to then to business, or the open term. term. the XX% noted was lose weeks, X gauge week that? learned I there it's as the do what weeks, mean, tails over last that the money, want but books. is urban we go is is transient short really a We much that sure really business right? on you of mean, properties back Well, incredibly now, weeks, go I business well, is have don't X resorts we far. my off. short pretty so if right how some we it effectively, And less out all I go said, repeated, maybe within we may comments business the could is to X idea and X April, the the make in

a from In fact, our day our to that in we the Not for urban X% have properties. days day. the some of we double might mean, go we occupancies at lot. where I XX% day,

to the So what at market. we is determined look we've really have

we at are. relevant to the We think have what competitors look

expectation of look quality the our We not least, that different to points we're because the of open share based more. reports that at have at price the if market get in at show our the demand going and upon with the properties, to location XXX and the that

our to everything we've is us ramped better. to to what has getting we or will market has be and far, level has burn so reduced share us opened think that gotten up a And or

all L.A., downtown as result So worked open opening in additional of Diego San with in properties the we properties in that properties, our I our it We of indicated, We're August. properties monitoring, of beginning opened relates the process opening possibility to very as Diego. closely think there's including to at July. in properties that that market, as a in a additional think we additional San yes,

yours, other you comes not business, of of sudden piece social Weston significant again, unrealistic one X beginning the market which, or next our business think improvement. they're weddings as in weeks the the point, and pieces, of the And their contracts over of in because hope year, of course small to businesses I the week Boston small next unless open probably or not Day in I given in passes, reopen. any my going in we're this to before Corporations, Boston. year. So W open Every anticipate gotten have in there comments, the We'll think particularly provide, to pieces the and X resurgence in group Labor of now travel cases, travel. of it's in all clear The that substantial as and when we travel to in Day with are total rest for properties to travel business, been all has would a in control not expect properties additional decide, changing compared do world. social some virus. like expect properties with X slower of know, other I caution policies just to a hospitalizations, We the arrival. I at shouldn't very opening was be places but improvement the around we Labor the depths, this rest We've D.C., of the cancel opening open because than the universities. could And not the there's

and reopen in unless Westin dorm or course circumstances, over ramp-up, $XXX,XXX and So the at maybe the the hotels burn, point, a when of like property we there of our contracts. XX-day W $XXX,XXX those with to this Boston at are is special the objective reduce

I And to best we pragmatic. the great, trying but So are. anything realistically, be get will not the of here, where we're be to it just to -- it's different the seeing forecast it's course to day. rest of Nobody's point, same ton be but end this of the better at a kind Debbie boat. of going year. Downer mean don't this And at we're all it's the over And in gets better, if that

or year. the business of next rebooked plenty It's quarter. business to Every show have in We It's canceled going up. books not of piece the all getting for time either some fourth on rebooked. gets

of question next Kelley coming Bank Our is America. Shaun from of

to but Jon, and are clear. up remarks, I Yes, of seasonality, about of the in we you had but an together, more And the a very Labor I calendars a that perhaps seeing, last are I impact recovery travel from just in. think, you And want think, the in about back to late going If of had some those have the history right? that's we follow we're on your the August, back-to-school. really think big overall that that hotels, markets, to least We be some California-oriented have some to factors what sort factor if -- do you of go here. start around impact, clearly, demand here, other this got in something Day should sequential year. comment behaviors school in have certain around at

Can know could is now that Some lead out time, change school. not don't of about people that talk you your those travel I go factors? couple people to you booking lead far. probably your back just patterns if that to a going are optimistic maybe

your helpful this patterns just sense to anyone. get longer analyze almost So a us of maybe intuition just or industry gut own kind for even be and than feel these would to

Sure.

that I'm the So means oldest.

it to I sorry. didn't put I'm that. like mean

appreciate We Shaun. that. Thanks,

Hold on.

me my grab Let cane.

yes. -- So

about So strength concerns to there's in leisure seasonality. the have is Traditionally, summertime. the reason

going likely people the be I the as the don't the large work severe number go fall virtual, physically back to school to think of into to of be Day go that back their quite majority who and vast continue Labor to going be home. after that the given won't -- not it's to transition from districts offices aren't are that

I continue And even a think up and even, feel lot end there'll the more of to a greater the flexibility. at cooped be more people will day. extent,

And less it travel. likely, business dictate -- control. of offset back or one with be now, stronger. traditional the probably successful could in are drop into operators, -- the depending to property them designers, think corporate weekends than direction particularly some I our all I or of consultants. by getting That's some virus. of gets our in a seasonality non-major and down asset we managers, Again, not that's traveling what on under that So what likely fall, weekdays, again, how some the road, the can the teams, happens be. some maybe know people to business in There upon of architects, contagion travel. our increase the might improvement are the We are subject think other, virus little

by see than for -- to what why regular decline of that X return. the that's the that contracts get on some we some So we're as and in contract the more signed can business universities, addition of the we'll some or indicated us, business offset by side the with decline maybe leisure

again, suggests, So Shaun, either we of this guess fall. see change which leading into direction at best point, kind the in that's our don't dramatic a

right? urban the And to thinking then seeing statistics relative few you're side. in urban you helpful. piece, So resort that's the of of about on side the were a helpful through just thinking No, kind maybe the

it? hotels seeing Are like kind opened Day rate And help sort are those kind markets up, substantial us amount think and testing in of the market as far a kind kind rates in the hotels, of what of supply on see dynamic you Labor and anticipation in kind generally remain the closed, least the just you for side, urban then open seeing what the environment or markets. of kind just at of you're competing? are of just of out either least Just competing to market? you given Or you've the on ones seeing for of trying burn at more of So can everybody's the the what's Pebblebrook's you supply specifically as you urban through that there against?

reopening slow in I think we're urban of seeing hotels some a markets. the

our at push don't those can, move -- that You post those properties if take a bookings can dates have take just certainly as we'll was far, Neil you but not what back of stuff see they beginning post so and dates, we those we'll if down track you'll it reopened. we this online, cancel lot or we further. those, if reopening open. doing that of asking, been -- We've them bookings any -- And people

back some of seeing the that supply are that -- come we that Obviously, absorbs comes the some to in demand has market. those into So markets. growth

there's the University, in fall, that Boston, for that hotels take think the properties an I universities taken the market. will the cities, other who's Suffolk market know of of have students, out as some supply like X and booked I some in X in example, or in

think a dare like New York, reopen before, a be while. say, to and are don't some properties for really slow I reopening, as markets of I going it's a said there we've that probably lot

I think not conventions, Chicago in time we'll without is Chicago, winner see times. in even a in the good -- good

an example, it in so in year this surprise New And won't many Chicago, Boston. us don't York, as if reopen hotels in

hotels to other we're been business I getting market. that Boston. replacement am have struggle to successful to big Chicago, Some more get that able hotels be fortunate in a that aware much successful for are in nor been of and in We've not Copley business reopen, many

for it's some to to the not marginally assuming May, close to that point. Chicago at would make that lot health doesn't there's better, typically tough solution better into a and going maybe be reopen a open sense April, fall, when until the and only fall of in get So a winter environment

that to So that with people the there Diego, continue better the color, because Shaun. it's ones that's will weather. Downtown I And come markets San a will because little come certainly. good say cooler. weather, are the they'll the into fall bit examples; L.A., of beach the would are of better

than so benefit those more markets. some maybe So, northern the markets of

much. very you Thank

coming is from question ahead. Baird. next go Bellisario of Please Michael Our

morning, everyone. Good

has weekend last X that? deck, might ADR at there much And heading pause the for anything September? leisure to that looking stats in the front Just shift? just into in you Anything a a the now into really the on your looks How down mix weekends resort read portfolio August been slide and like is give it row.

It's Chaminade kind it's rates don't question. -- in good like Yes. the It's mix a Key a meaning and of Skamania and property have that and L'Auberge properties Paradise a as shift, it's really of the mix Point same ramping up properties but West. shift,

in revenue about lower-rated drive So in continue July. to and why more up picking go we closer to ramp to EBITDA -- $X.X we'll that's resorts because -- think at the up hotels $X.X plus we it's in said you're million But from million something more I just is from happening. -- June the

the So continue bottom better. line numbers to get

Got Florence that's and quarter, on then it. any reopening your but impacting how renovation at it legislation I this And And your have a later shifting you also year? last about then, update talked just Francisco. scheduled then know we about gears Because passed on there? San the closed think CapEx hotels thinking Bill recently I spending?

Yes.

tourists other leisure Xb city So the yet if San only Francisco has and Phase something don't resurgence to they Xa, they allow in in California. parts of return. California or They're backwards move reopening their cases with to move that to or still in of know, is I in, the

not there's anyway. business So San in much Francisco

way legislation might the to clouded markets other the and driven Francisco of by my have market that that work has the see ordinance have I'm cleaning just hopeful and we There's there layer reopen. the don't mean, -- hotels to be procedures is mean, negotiations this we're it is extra make reopening moment, demand the some for of any they and really I legislation during markets reopen We're get think impact the on on other union. other through city that as in going the San I some mean don't reach related resolutions some hotels I what by much I with an think until where think noise to going not -- return. ultimately from their markets, I is And pandemic. cleaning we other we X the hotels hope interrelated And So I passing not will and business. in that demand noise. resolution to little the And in open. rational reopen the there you unless

but to reopen reopening. I plans the And meantime, approach We have city-based if don't don't a mean, that changes. right in Francisco. hotels upon So just -- in in any San the see we'll year it cards in that we any to their play by now recovery

Our is next Barclays. question coming of Powell from Anthony

that you more permanent benefit I'm from in New where announcements other think seeing the run in conversions industry? you York long or could markets over the closures a you're any just Are lot more closure cities. there in permanent and where

the that reasons those the think are Well, in challenging. markets they all closures, right? I markets And very -- are mean, very meaning closures those in, -- there's economics will whatever close for help I market in

So be I do that will the think case.

as aren't box or significant think new we that closures good come maybe may tactic. be that and were have not a conclusion. they business as there and in competitive. negotiation hang needs to permanent I to perspective. going Or that -- think, more business operate But It's ownership a good, location. a happened part permanent, cycles, sometimes, prior to properties times signal not a of might some are under cases, in on. could tough number been expensive particularly will also they not closures, they're -- forward, a But it's have things new But in when of do as

give on next groups convention kind activity your to the detail there? canceling citywide or most trying if dimensions, centers some Can half And of Got the they're are of year, also second mentioned city of how some you it. XXXX, are you commentary rebooking? the that schedule in And us what rebooking. on

Yes.

quarter be, whatever. investors, in year. see mean certainly don't trying something research, know, for year starting help understand explain there's next I'm of we're So this And numbers relates rebooking. of just if everyone, already, none to or no booking And clouds crass all it rebooked relevant. times to -- don't information me or cancellations numbers. probably -- rebooks, I to and, statistics are that I be the X There's would There let relevant. that that as the we've or first to groups X are that not look,

to to it returning announcements, say X don't goes seen July they're think offices. until XX there's corporate controlling like You've until anything changes and Google contagion. on this not XX when I January December some progress their December --

X haven't I And you, months some the tell mean the to frankly. that because quoting to at in of certainty any bookings numbers there's relevant. pace to begin misleading something, our no end group at looked have I the point So it's get they're until we in not because you more day,

with convention So I we next facilities. are in bunch know are booking still plenty the business back? come right What I can't are fans alone people? or homeless have of can business centers those do going their for they What have let a stands. solutions it even baseball year. And mean, the teams in come not. there? of will now, we to convention don't There's have whether when play

at from gleaned to negative pace don't We're be just be mean So again, trying group point. nothing to be that I sobering. realistic to or this there's

maybe Understood. And just one more.

about control. simple talked You make get thing sacrifices emphasizing to under these to this

HOA. are to obviously better policymakers the share in You're the of a public to near What you this recommending the and term? get

stay to the program just a part Well, the being they policy it's X imposed a -- they for the wear society inside. science of wear recommendations We the apart. we They feet masks. major It things not the masks have on good. that people are the should take provided. society's to even because should a masks or with follow are masks, of whether required plenty areas -- They and as that end not issue day. properties just shouldn't drive are at within of gatherings, our industry should have guests safe adopted These People in require stay constitutional car. our tests to public rights on

or can't You stoned. you're while drunk drive

speed There's limit.

deal to to others, but selfish big people There's doesn't you don't like that. where in protect mean, are it speed a that's protect mean, I okay, to do to seem want limits. world, the there plenty asked I others, fine. I'm of if

it follow mandates either sent states. letters in their an trying I'd there more We have the to states see to country those mandates as the are so that every requirements And or science. increased cases. every can week, them impose to begging say in mask impose industry. day and every do And or you We're governor

want that but associates, Thanks. of our taken. be the be So that's only not end safe, they're feel And we've at sort of confident the it, the our to going day. we and Anthony. guests to approach to Appreciate safe

Advisors. question next Lukas from Hartwich coming of Our Green Street is

what getting used the Zoom, from also you transient to adopting an your update et We're Can a long-term of us Slack, provide cetera. those technologies business travel? is impact of Teams, world on of potential views

Sure. I meetings." I that been is people continuing this living the mean, a that to we've years. I think replace I for XX it's And case. "Video going XX where remember from mean, past not with the said, cycles, or prior trend all was technology

grown I reasons for over meetings that think, are it. interestingly, period because there time other of have

world. will and get No, and to and and or meet We're business that We're It's client's I go meet to with it productivity because go is humans. think as else get companies and something our know think who's dinner that want to it's some thing psychological to do. for to you're person. so far." home. live in say, Will win to already any over sitting can and and be of mean, by we up "Well, -- postulate kind I would to a somebody competing travel their them. some them We it interaction. what out business it the competitive the someone They're Zoom in out client I equivalent to they in someone it show else nothing doesn't Do maybe demand? done work-from-home with of can quite world Internet. transient digital there change that and about about important technology? all And and think substantial that, care stories when from I I retracement cause for And is be person that trying been interact occur important second. going issues, at deeper a into come groups this Sure, who's Sure. don't. Social let's human. well-being. There's that in And well, seeing office isn't socially

You go anywhere. can't

anything. can't You do

yes, that another just look So surveys of We we've I our employees. did at done one.

it, sometimes. to to more to to have is, the happens the beginning meetings, at together, will from actually day? be in the work more important more when it it culture, home off You important with can't end people workers to What's what allowing together. home. I it you're you turn the the believe think of projects are not in But and bonding, together flexible more get the work to think to build office, order we strategize, a on if about becomes build And companies the is

certainly over all videos and up it So, on pictures can leisure increases think you the end as from I at Internet was we everything work going the actually think long-term it's at the It's restaurants from can the pre meetings actually look the day. the go home the there. pandemic Even not the and but to eating -- where same of end the and going -- Internet, museums. It's the them not not on at in the like -- right? it's the if it's do and day. trying virtually, like food you of And not

then, to tough government? support industry is a expect place, the in I large have follow-up. you financial support And from there? views any clearly, curious. Great. there just I'm and just mean, quick additional be the one on Do you at Do additional very

actually get support do level, downside unemployment more federal, We the think some And different supplemental comes extended. mean, different limit will pieces they of did We a back. in different I do. that where I -- programs. of the insurance, unemployed Yes, employed. supportive at where are declined it, don't to we've folks have on people than seen come of money through make

think And what the is capital. that's dear don't a best I so use of

through there leverage revenues impacted, We to with really think The pre-pandemic them real individual help will whether the to slow program, a and treasury or or equivalent XX% in what second the industries hotels have discussions will mean, that is revenues PPP which extended used house meant provide. continue and to think in program real we to equivalent through because will the been from with -- And be I or really levels. will severely been that's long, drop the Senate have then, limitation's we the estate has difficult secured really drop the estate for recovery. by continue think -- as get industry the changes get -- lending. we in some defined owners And PPP over MainStreet of for lending not help not will get that XX%

And so, as of we're to -- EBITDA the end we've criteria day. proposed LTV multiple opposed criteria the at things like

do benefits of Lukas, should will think, out in pass next the we all additional bipartisan we there industry areas, that based those legislation ultimately believe that, this So upon come to be compromise. again, of a broad-based

Robinson coming Miller Humphrey. of next question is from Our SunTrust Gregory

entire practices, the And with the hotelier perception mandates, recall, reliant could hotel or you safety require the from the the the One differently industry but a just for your remarks Jon, not your improve demand, the on travel if some And need what by of should consumer companies and good recent within perspective, travels, hotel do bodies today you're government if about by on following industry I especially think perception experience. the of that buy spoke Helsinki. recently space. safety a do travel off I watched travel argue somewhat going is operating for hotel masks? you your of related to today, related not standards corporate do within especially government webinar

that's Yes, really question. a good

country. to airports airline operators across the of program with have and the a continue industry to speak the we So consistent

that have know don't think to the a related Is seen frankly, that it. are, long don't wear middle or are other together industry. everywhere seen have lot flights? the connecting they So those but more they have band airport? that but consistent not? or time, more to confidence don't should they people know you're require airlines? that there program no knowing it all adopted I required instill used a Frankly, fewer flights, than And a other connect, going in Most across just if on it I signs. seats is. requirement I most in they no -- be There's down take now all travel. it is, on I've of And programs, potential masks will their Are Is the and a deal they've wear that around, masks all there's lot to of Are in if consistency non-stops you airlines in it make and which be, seating know I've connectors. I think And know than of effective the this all to that there the There's don't When what of I've -- airports? between related know. took offer. entire their what's them only need to seen that used taking they Do a environment, a bigger to I there now protocols maybe airline? think there's -- Do the I flight, I people no. customers I enforcement. there's spray they masks? out them, no could but, still be, that the you what you know. And because requirements a have program way out cleaning it's more we'll to in ads. to there what planes not answer's recommendation.

certainly to the airlines. So relates those -- that

else. be than think more are them fact helpful for virus -- attendants And flight have I fly promote been to constantly. to they anyone no likely get it'd the more no the that

worst, that that protocol. car. one but So planes or the people upon and customer who's They're when one rental have the else Lyft, we've business think the up you in over given they've car the and the controlling. cleaning to no don't rental only presumably, of wipe down until because car companies with cleaning protocols, systems I they're comfortable be And safe pretty And interestingly, is compared seen. at belief get car. probably gets going Uber in surveys across feel return are, as then, that one you air And it in, places to point the the frankly, the you then evidently gotten based the a more

So suggest. I think those are the things I'd

elsewhere? there concerned may this are your saying, to functions? or Jon. same be really you the Great, of management you and long travel also might How not "I'm other move some cases, doing in like impact operations, as industry to desirous call, some to about senior some within the today. engaging any then management, expect DNV traditional and that roles do you And being to be a that your hourly property And on longer", talked from

what GMs I Yes. would business, -- more operating involved of brands will, the of the back-office, think described I is with to And built as mean, I in out off-site the some made will more resources as me long corporate of term, this an more been maybe proactively officers chief be that's agree seeing outside come operators. that of be by we're of get decisions their are being where and will example. more in this, major

guest more operations and operations away the more satisfaction India in little whether to where you the maybe more. corporate going of be have side. done a there's more There'll you experience, bit offices, and move off-site, people, can it's more to the not whether senior finance revenue it's probably operators, at I off-site, And the property be side but accounting, from and some the management, think and back physical the financial so

who the happen. when to I the think pandemic have going the I And But than in COO leave when perhaps industry? not -- your won't to pretty to -- we're maybe and frankly, do going that of They're not -- we to -- end checking some people special would other probably XXs it's Sure. So, running that see people managing prefer I from to and back -- we again, in be do the I business. we being that. probably of people some be think CEO leave And there'll mean in back may people day. actually and saw do at may situations. to think get

the thanks, enjoy summers. days. And rest look I'll those and your of to forward

Greg. Thanks,

you. Thank

ahead. Sachs. Our last question go today is coming Goldman from Please Patrick of Lobe

think has for or It's from think around actually you start has the levels, this of do coming for I me the process you Thanks the -- acquisitions process right the as your future, Goldman. leverage evolved? thinking Grambling the pursuing on either about industry's thought potentially up sneaking in. as guess, thought they Stephen business even about or backend

that's lot. good talk question. really about a the community talk We brokerage Yes, to about lot, community we lending a We the it a with a lot that. talk

get near-term, the loan which will availability, what overwhelmed what down, will a is happens will cost think more typically the probably evolve is leverage -- levels the I cycle, by go come it The the in for restrictive. will then capital and gets terms up. levels,

will the level -- the I liquidity, think I think the more out resources. come one so less about about things is that and focused maybe leverage on perhaps of about wasn't this, of that

the our survive fund, is that That's to not business $XXX in we to unused think hotel the I just got need have had of So, to line following today, I've critical acquisition million survive, right? credit together critical but -- a -- We trying LaSalle. to you're put liquidity, are ability and anyone liquidity. mean, need you leverage about if hotel I we excess level why the if now still here? I to

think usually that do that's leverage the I cycle. a level, probably thing happens biggest including overwhelmed, So, the and gets changes. gets experience restrictions, capital the memory that end usually overwhelmed by the towards and of The cyclically cost, usually

So...

about size for benefit cash, this to the as of REIT having capital don't a on you away just if more as who the standpoint, availability in this waivers; seen, -- clearly, revenue those ton very it's had Even other a public of think of Stephen, the from REIT liquidity issue wasn't hotel REITs it's EBITDA you leverage be had area. market. you had Yes. going think And liquidity bank REITS, leverage even with been get different that issue, the the we've to also, still so the had side's liquidity low the then side, I demand, issue. because pools But and to an want But going about so rely necessarily there. a

combined and all -- a REITs on bank are lot the there's markets. of So pressure relying that

different that's placement private we've sources the as other like or think channels accessing the recently, at we you on I look next go cycle debt, of into whether debt markets, more think saw you'll side. I with here, the folks market accessed So that Parc

next know, be cycle source I of will that we times focus where the be finicky because, one it'll for rely certain can't an debt we because not just So, that area think be as into you get a could at as or be on available.

of and bondholders, piece -- one from moved and the the a the is to, to the just -- day. -- you CMBS that we sort end their relationship, problem, at a think they're debt I have of client the other partly because there's there's and borrower of there's have they -- away no is think I had not nobody contract, talk client are multiple when

to other capital private view of And away mentioned? Ray sources, companies. from placement bonds will be So, will to how that perhaps capital, they of it move CMBS particularly the as see the public source changes, interesting or among

a -- way recovery potentially buying loans a and into asset? would other an ultimately exposure getting I or controlling of consider as I follow-up quick as on to did a that. ever of guess maybe effectively CMBS mean, you types

an as but to of expectation our financial more management buying a I we would driven it in Yes, it gain because And asset might the we that lender and instrument a allocation fulfill expertise. and a are process we a is through expertise. would going by opposed I be capital -- -- would return value-add that allocation. and Frankly, but a and financial likely capital is real redevelopment be likely to -- just asset think while ownership being not our control

And it for successful that frankly, is that so capital and pursue pretty would in us to area. compelling experienced have with be that, much more be other to

Make much. so Thanks sense.

Bortz Thank for Mr. turn I'd comments. you. like time, to over At the back closing to floor this

Donna. Thanks,

sorry For a of that and summer, answer questions lasts Thank time, the have. the about anybody but participating, it all rest however long you have us, for we'd who's like still so here. the much good with to folks

you again October. we late So, to in look forward updating

Thank gentlemen, and you. thank your for participation. you Ladies

day. may and have a time, disconnect at this lines You your wonderful