Park Hotels & Resorts (PK) 6 Nov 202020 Q3 Earnings call transcript

Greetings and welcome to Park Hotels & Resorts Incorporated Third Quarter 2020 Earnings Conference Call. [Operator Instructions] As a reminder this conference is being recorded. I would now like to turn the conference over to your host today: Ian Weissman, Senior Vice President Corporate Strategy. Please begin sir.

Thank you operator and welcome everyone to the Park Hotels & Resorts third quarter 2020 earnings call.

would made remind statements today securities I of that under begin, laws. comments the are we like everyone to many federal Before considered forward-looking

subject the in these cause could forward-looking or not to expressed these filings obligated described those results risks with statements. from we As statements uncertainties our future are revise and to differ that to numerous and update SEC are publicly

as we will discuss non-GAAP adjusted In EBITDA. on such today's call, addition financial certain information

will together information brief GAAP supplemental overview this with You financial an our quarter reconciliations this to Chief earnings of Chairman liquidity. Dell'Orto, website of an comparable on find Officer a can and and as results well position, financial well filed directly our Chief more operations; most Executive provide with review and current on Baltimore, our our our at financial morning's will the update the available detail sheet the SEC Sean X-K as in on pkhotelsandresorts.com. well measure information as Tom as balance third This as Officer release Park's as Financial in morning; provide

like call over Following we remarks, will I open the to turn questions. our With that the would Tom. prepared to call for

much Thank that and healthy well. to want I the and and industry. profound you saying and families Ian is on globe has remain safe been Unfortunately, across welcome start hope continuing you by of everyone. its I our pandemic your all impact of the

keeping the priorities of Park to resumes. its progress has more longer-term pleased have I report clear. and near-term an that have onset am Since opportunities towards on adapted travel we and reality, significant our new eye widespread adjusted COVID-XX, been As objectives, while this made to

a attractive third, second the reopening asset strengthen partners financial successfully safety the and well-positioned mid-September, subsequent and our and to suspension responsible fortify First by raising sheet raising debt rate in aggressively with and times incredibly X-year million guests; secured the eliminating by the our further our additional of offering health employees foremost changes navigate to point and at during near-term maturities ensure our such liquidity our Accordingly of We will and executing near-term debt diligently start balance the $XXX company raise our liquidity concerns. hotel these successfully ensure and and challenges the of notes managing portfolio, debt believe proud I very of second, bolster largely period liquidity, bond short the our extending a of and the quarter. made risk a time. reduce make of strategic and efforts am maturities. our sheet in team corporate of with collective hotels; pricing to virus us. burn and by capital the unprecedented impending balance we including we of partners extending when sheet launched balance Park behind is the to the and impactful our I'll be eliminating worked relief to covenant proactive decisions to debt COVID-XX maturities

relates it to Finally to we with expected to proceeds assets remain to as the down sell be selectively on focused non-core sheet, pay continuing net debt. balance used

is market we to wide, capital remains and spread bid-ask more recovery sidelines the a the path a more anticipate once While there the apparent. of amount transaction is on significant active

March focused team the Turning has hotel to on of our Since mitigating diminished severely operations. impact demand. been

reduce rate to monthly our several initiatives burn low maximize in in order efficiencies and environment. undertaken a demand have We

first a suspended the several more ending at our operations quarter operations our travel During six hotel the at defensive set much reopenings of others, were actions at of the in hotels with June. reduced restrictions of our largely quarter of on we height second and positive XX note as

Among During we with in XXXX-room Orleans in our the of leisure XX New Riverside second Hilton a markets up the XX%, quarter an West portfolio the across averaged and moved quarter. and XX% properties exceeded Key hotels pockets additional increased XX% the closer post the quarter. averaged which Orlando averaging for recovery, quarter which during toward complex as Bonnet very to quarter XX% for third from opened our hotels solid Creek occupancy. drive-to over occupancy we X% of for both occupancy the including continued demand witnessed results our occupancy XXXX-room

Hyatt San Santa Marina our to in in the Key all Casa fact year leisure in and last Mission held our the Regency Bay drive locations. resort relative supporting impressively Hilton appeal Barbara Diego In resort resort in with to West along rate

first Hawaiian to continue currently weeks. quarter. mandated strong Puerto and state Hilton quarter, both quarantine. additional Vista areas we Thus with the Waldorf mid-October, Caribe and Data in as in revenue New demand, show in departure plan we well by our have In Rico total we to the and XX flights Lake far also Orleans, Buena the at Hawaiian up over in business opened related Bonnet these XX initial, the airlift the by open testing to XX% plan incremental the XX XX-day state the Creek, within fourth hours demand, like airlines around expect weeks of of next at related expect NBA Rainbow months. to airline two hotels began the Village Hilton both teams rooms. and expect Southwest on such COVID as Hawaii out bypass into resulted reaction with loads Based to of Our hotels and ramp Hawaiian All to XXX-room few currently Hilton university monitor find lower taken from receptions, by we a of we the proof at the demand village and combined, and Astoria we encouraging capacity hotels they patterns in also to these mid-November open over open have United Hilton of as the XX% a of to demand year-end test expect protocols, to as to opened Orlando in these for trends that hotels, mid-December. of accepting Hilton those for while a negative the and coming to with $X at two Tower the million Hawaii at which representing over significantly would the positive continue XX% our are December, forward reach reporting

and the In incremental higher cost. XX occupancy healthy thresholds irresponsible with demand York are Hilton added QX suspended across the little New Chicago through during the most in of four city's remain suspended travel XXXX. these Chicago and year winter suppressed ordinance has will or with in and Francisco. of And needed in coupled the Hilton the unreasonable and has through no Midtown it's The hotels, leisure terms months, San York on lengthy rest restrictions New business of likely the remaining building markets

last As not I increase therapeutics emphasized meaningful vaccines call, our a to in and until we see do become demand expect available. on widely

our the our current forward in Given outweigh this in liquidity. we the to situation, only approach hotel when reopenings, preserve to benefits, cost economic order moving remain disciplined

Turning forward to trends.

that like hotel months the will transient we surge are balance concerns as leisure the demand our business working While to public of Barbara and hard line cases quarter dampen, continue winter in instituted top during the cleanliness and standards, fourth locations, net the have to in continue our located Key through and brands over brand drive-to to Park likely teams of with outperform partners we of Diego. year. the our solid the generate Santa both reassure Overall, positive group demand property among this and expect San ongoing West, hotels over the witness trends markets to in for and resorts XX%

COVID expected pent-up and a bypass are our of and the also in this the negative the We test. there initial for do demand now with from that to proof is travel Hawaii. properties also indicating of reopening allows to policy travelers changes We Japan leisure-related Hawaii, encouraged note, indeed week, the quarantine to by just state, that state Hawaii airlift of

lead that demand Japan similar are this rebuilding a we hopeful, the over to and So months. will coming weeks from of

XXXX demand look first cancel to balance quarter the planners side, to or group was of in bookings there meeting group the two of as a weaken, events continue On little their XXXX and half for in the advance.

clearly and into second reimagine However, opportunities business more the room XXX,XXX medical group cost it pace years, of this XXXX the booked In X% being holding, half by half available are booked laser-focused dependent into environment, in with or to for savings group and next early we XXXX on of on than XXXX. X.X% is the ever the second model. booked business future COVID-canceled has been XX% solutions Over nights year. of approximately

in which to XXX-plus an but difficult, very across the levels. took savings $XX million reorganize we on of based level a portfolio, point steps result, margins result management equating our basis, property revenue a As on in XXXX necessary improvement to will basis annualized

to CapEx also and the business the savings the revisiting progress food to we'll the allocations. these additional and model, cost to expense operational and apprised significant, including of to initiatives continue date, to While work complexing to continue beverage model and standards, expected are property brand keep line. I'm very proud reducing above reinventing eliminate from with our positions, brand we identify ways both partners and you bottom our of improvements

not will done am challenges date fundamental believe country's by reassured this incredible many the managing and to crisis our virtual in positioning our through replace I need have resilience While the to has in people through and do in successfully I person. there mediums Park are the still side. connect this team other ahead, that through navigate to also believe work

that Sean, will with success. benefits our we visibility demand will should outsized work to have we call position the to I'd leverage strong will that on near-term serve And turn and to high-quality stakeholders assets normal, some as limited more long-term balance operating on recovers demand continue over to sheet color have with for and tirelessly to provide who an we Park incredibly liquidity like and return realize and our when platform While

Tom. Thanks,

no quarter briefly experienced for continue demand surprise June To said, September improving XX% Box averaging in in XX% We remained incremental hotel in hotels our XX% RevPAR occupancy XX% from occupancy suspended in October. with Turning XX% to of improvements consolidated with Big in sequentially as leisure XX% in ended September. quarter. decline, XX% third results. we August, our solid witness That the during our hotels in resorts an quarter several the July, demand drive-to and with to to opened

demand approach was in hotels averaged although airport Occupancy the XX% large September, reported reopenings, capacity, which occupancy account by our open in open disciplined part in we recorded captured in consolidation drive sources encouraging into While set university and which respectively. helped strength of and between and airlift month of team hotels. takes results partners Overall, example XX% at of and great mostly due alternative of September Park into is to This Orleans XX% demand Hilton and XX% another locations and highlight great and restrictions the by like both our driven the for hotel New our occupancy urban the suburban hotels New demand. operating Orlando Riverside, collaborative trends, ordinances, management effort and asset neighboring which local our to these state further to demand booking Orleans related strategic results.

which the generated Xavier May $X.X part hotel which Riverside Barbara, profitability, EBITDA, and In open hotels breakeven exceeded with which EBITDA remain including combined expected Casa is at Santa XX approximately producing Marina, of were of the Hilton or of terms EBITDA to business, through third XXXX. in $XXX,XXX the million million University our to large hotels better top-performing thanks of a $XXX,XXX, as $X.X of of with a September, consolidated Hilton

our As quarter quarter, demand burn $XX further which the our over improved, to to so overall $XX to for did months. during helping the XX extend improved liquidity second from million rate, monthly million third

XXX slight declining Looking of projected the XX% operating XX% occupancy group a environment the demand is points the with and basis year, remain balance out to should in continue improvement quarter. with another over over expected third improve from revenues RevPAR challenging to as be to the over down

Turning the sheet. balance to

which runway helping diversifying including debt to had improving in sources in incredibly our while our capital to extending The and transaction eight-year the alternative profile are effects, late noted provide we ability balance million further sources sheet, near-term oversubscribed. demonstrates very Tom this access reducing comments, longer enhance times liquidity, $XXX debt, to with by intended his coupon and executed X-X efforts through a [ph] attractive issuing with offering of at our having another and September, a which exposure capital three of to As bank bonds X crisis. our maturities us several successfully ongoing bond very our also fortify further to our further navigate pleased successful

term net from in December Specifically, maturing proceeds fully a used to offering million repay were loan $XXX the XXXX.

negotiated We to two-year our was a mature majority a XXXX. December also revolver in of of which also successfully extension set

Finally, recovery, the pushing testing relief, the slope XX, we successfully additional XXXX. given around until covenant of the ongoing uncertainty out March negotiated covenant

As very billion shape billion with totaling our our the solid of debt including at sheet liquidity prepared end, $X.X is $X.X $XXX available remarks. quarter while That million on revolver. our concludes in balance stood net

now please. one address we of yourself may follow-up. Operator, ask question each first limit will have line to questions, We open that To your Q&A. and the for the question, we one you

conference your Rose question we At this with a conduct question. time Please first you. question-and-answer Thank [Operator Our Citi. with proceed session. will Smedes Instructions]

Smedes. on morning. Hi. Good [ph] is This for Daksh

Just….

Good morning.

about Are you good – thinking morning.

more in capital whether or at to you are thinking Just looking bringing about sales? deleverage meaningful partners asset way

question. a great It's

given times. intermediate it long-term selling but get about us made that XX Park of down and up to clearly sales over obviously – has the progress and for is been assets had have if to you our balance playbook, a We've had part slightly about in brought We about Chesapeake X.X international. to obviously years, really debt-to-EBITDA down million we low the First, lever debt XX $XXX and we think global a brought the historically the after deal net pandemic levered planned our our level. sub-four a including asset DNA great down none to sheet of

experienced team, So it it's and very to as seasoned a relates transactions.

discussions of in on active kind are We sales. asset

it optimistic the see believe that, now. on do debt There's is right discount XX%. available COVID going tremendous the we've And XX% that As we we wide less narrow. the thought we said you on previous sidelines, of the we us balance sitting the too any the will those to strengthen call, operating cautiously was a discount equity months. this certainly see point and capital COVID amount to was But capital that for in that's from are to sheet our partners need offering sales use and We time. of this not this the see be do delever will time. need, to And And the a profile. do coming asset dilutive proceeds liquidity at at for continuing not

strategy just want to way just you exposure And group to the reduce one Thanks. Great. then, follow-up, large your on about assets? you're thinking would

we affected It's exposure, would that, the to side the passionately, of are the having in in these I do great for and solutions. will other got on when scientific And medical in strategic community see this look we've easy that that get some the in cities, the that and that living on today. once rising given that, solutions a really obviously the are also certainly of footprint working women normalized, advantage one in people fact obviously But and the I place hopefully And medical Park's Park. do most and that men more believe, be more the say back rate adoption of great in to markets. some we got

investments significant terms and done. huge DC, will time. long-term, And edges, of matter. look there. to entry in York demand even or their cull Southern New clearly new that getting development for wouldn't return think there or a markets. or the markets we'll there Boston, risk against, around think there in status, are But So are or that nature really of are barriers in of I Francisco, I obviously do over And of certainly improving, in San a the a in and the I certain terms bet some Chicago, Hawaii belt that L.A., be

today, those And tailwind. so get I side and really for will advantages as see the a other over be advantage long-term. as intermediate us that huge More real for Park we to for painful the Park but

you. Great. Thank

Jefferies. David Please from comes with question question. with your next Our Katz proceed

David. Hi

long-term Hi. just is business the of near versus this your intermediate-term voices. recovery. that what value to the a about which well. and of view you're urban the And collective is doing gave you Good value may hotels? to And follow-up be all trajectory around Tom, everyone's thinking the and hear answer Hope travel

the you. leverage goal balancing metrics, your Just with Thank to other of versus getting just of near-term financial the long-term not. and urban

that, choppy eye greatest will It make to of additional we thought the about more I difficult have that's Sternlicht cities obviously place the it's certainly XX% occur, that said to Barry decade. of know that is it's and saw attractive we're that, fair reminded I'm the given we assume investment still the that, there Yeah. believe years the that storm. David a ago needed be fact the supply run-up and we putting back. singular part the New out expense a perhaps ought let's bet but obviously the he'd urban very belief of I supply of now in be And many question. of and in of worked the restrictions world will municipality of the hotel last to it's but away, York, you people strong bet. well, our And that that, on, in of challenged to to people in the answer that are a when lot based think were at thesis. going hotels as York you it the think reset construct, that New hotels. respectfully about right will go for made other that would -- only on also supply think And be I based markets, would many XX% today, in over submit incredibly And don't going independent one branded come that the centers when the in

I it your and going the do have beneficiaries whether a I intermediate more even need It business from group that's And people And of celebrations, follow-up be working. meeting believe, run I an mentioned for save group even would need more a question in So that believe whether whether for that's come those perhaps are regarding, connection, make remote little having that's back. to for lose do it use what's remote again, that they a think be say -- looks and that's I incentive But sales of easy long-term, that. these together, little to do flexible to training that platform will naturally call, the impact. I even and argument leads a to personal be I kind we're others the the are their greater, meeting. companies had would those fact happening going I the recognition, valuable. never the city many our obviously, like benefit cities plans, that of Zoom for together, But it. an us could people to in think think you today. working, for more and that, major it's you cities I bring for make of that, would that

be still never I footprint, given XX for years footprint. that a Coast. Hawaii, two our were exposure a bet investment blessed replicate the we in Would like generations you thesis an some less to generation that like that certainly with extraordinary X,XXX to cull We would resorts Village West the we will Hawaiian -- So incredible in over rooms Sure. could continue going. some and great and little exposure the have it's of acres, in story Hilton -- parts XX come. nearly the We be markets?

that hopefully answers question. So your

and notion on that the hear versus You overlay thoughts I'd past? have I definition too recent follow your evolved to your those may the non-core have. of if over core please? how that love may around And up comments of just

great It's question another David. Yeah.

our today If XX% their hotels, on I would us and I really top sit you refer and compare say closest about at you think XX our top the to that look data for of obviously peer also portfolio, with provide our we compare XX XX. perhaps to value. our our host, would top clearly well we respectively, if XX account hotels to

really investment we're the I and thesis think focused. capture those where

there I Austin As are see beneficiaries to population continue I Denver migration. mentioned see of up. of that I some say think Texas. markets continuing in will would I perhaps would will Nashville. picking I and be parts as grow certainly would perhaps

little that a are will those clearly become attractive. So think I -- be markets more

of jointly But You has hotel footprint say resort had that we not Miami in Hawaii, jointly, Nashville certainly would where being or but onslaught that with away I own supply, Diego. see those an the we I Francisco certainly of Sunstone in be have in the certainly San San walking extensions from today. can oceanfront conventional could own investing or we we're

tend that's -- going team today We So certainly to and brands. be they the focused given to we and expand time. Hilton that clearly brand believe it's only certainly we ones expect Hyatt Marriott to and continue on believe, that have over and a change

so Thank it. much. Appreciate you

Thank you. Yeah.

from question next comes Our your Evercore. Hightower with proceed Rich with Please question.

guys. morning good Hey,

Good morning, Rich.

have helped here, CMBS think So couple I your may of you just but a on answer my assets. Tom, question

list. arithmetic that, close of comment maybe morning saw value think my debt. $XXX,XXX on it's irreplaceable just key just a then Square And of value asset debt could blur if that there's an to asset this placed Obviously, CMBS maybe that there's of long-term on your a to Village. Hilton but you view on -- likewise, and CMBS in of the XX watch So a if Parc of relation Union Hawaiian in the has lot a correct, I is CMBS I

well as sure you I'm on technicality. probably but you're not color mind? And if just some current additional just deal, it's Now behind service debt still that's maybe a big don't if the that

of Yeah. things, Rich. couple A

portfolio, the XX let's assets, at all just estimate top the and replacement If entire look cost probably XX. on the focus but that's we you --

$XX.X billion. You're about

to somewhere you Those south between and discount somewhere when so Village rooms feet space, that. are mature at Hilton XXX,XXX retail like time So something key five mortgage $XXX,XXX $X.XXX billion when eye-popping we're got numbers. impossible square XX%. towers, to again of look all-in doesn't you're about replacement meeting we're you about again at And a certainly cost another value, nearly billion trading XXXX. somewhere XX% the a at that. trading think at today some Hawaiian enterprise of CMBS replicate until we've of And feet $X with of where XXX,XXX Obviously X,XXX about square

not that's are dominant an will worried think all has asset We at one. that to generations continue We and that the about that. been grow be for performer that's it

obviously two now. Regarding assets $XXX of the in of San Francisco, right we're the I there. terms think We're in storm correct amount the debt, million… can the me of it's eye Sean

$XXX million.

Yeah. $XXX million assets. over of two the

We be covering burn concerned issues will building are performing, are rearview other certainly, in and issue. There for assets mature that in happening see themselves believe sort. the no debt no the will issue And the of both are rate reopened all that they XXXX. need cash we that given will current our in we We community we service near-term in with be as about scientific the to as mirror or all to great confidence that that well without be the there. have work the

savings there's and context you if is the in maybe expense operating on have Okay. question engine future obviously, new brands, on owners upper unit lot the a cranking of sort And as gained maybe supply, I color, post-COVID a just now of first right growth owners discussion their for that of some But listen time the of time the then brands Tom. appreciate negotiations. to between obviously and long the we those hand calls, speak. a the in in

lull do it the over sort And even, about do so issue you if how near a in term? think of How longer the supply that think next there's about in term? you particular

distribution. Yeah. It's as for and given in perspective partners, brands, great have worked about having my worked twice, of they I – the background companies Hilton perhaps all Rich. for Marriott And a unique three wonderful question, I they're brands brand having create and a our you know

think right is of COVID out reset your disagree, I you before think don't we forcing balance and I were wake-up a and crisis a peers I many perhaps getting and call. would think of this

healthy suspect and businesses community. you hurt also continue to hard. the businesses will really been reduce and are these intermediate The their are the that, capital-light, owners franchisees been have While timeframe. ownership see having over they've a their hurt I on supply near dependent numbers and

be I think there'll capital. less debt

to less development. going see think I you're

pretty And refute side the of commodity so scenarios those would newer have. growth that I select-service has fresher they wins. more more and optimistic some respectfully like business become In a and

already think the all strongly So pretty of clip seen see I about forced crisis do this math pointed growing think cost is to hasn't that's I of, feel also think for compute, supply That's over and I those basis really don't even of kind remarks, gotten and that to of rethink a our points out prepared $XX will model. us non-union what has older we've in XXX That taken I out. the in that million that. real point hotels. this down that I And crisis CBAs, as the the with force operating we don't And balance is really well. kind the to and think those as sit think opportunity represented to assets, find I you terms there. but a in in dialogue the at we've replacing, a better going past, just of employees, – I by

has have risk of supply impact, footprint it supply our Park look less all almost given we peers. on If the than you and much our at

more certainly But in New will There's take and pick move XX% that goes competitive we there. or going Chicago, supply see advantage be is reduction it distress your significant to XX% York, the forward. of as there more as that There's we an a what's away going reduction So that be naturally clearly into look to extraordinarily workforce of supply there's if be on housing, – pain, be unprecedented going residential shelters. come into to be to industry. out to going that that on homeless Is that's conversions is impact is conversions. going our a in at

Tom. Thanks for the right. All comments.

Thank you.

comes your proceed Please question next question. from with Powell Barclays. with Our Anthony

Hi. Good morning.

Hawaii. on question a Just

and there versus where still do In opting for you Island impacting program? maybe of customers that the U.S.? on sourced into your the terms the And of those in Hawaiian that is testing not think is Waikoloa, Big being are how what property terms property? demand maybe And demand in Village

Anthony, the we questions. it have to that doing a remarks. in and also the during replaced as our for the approved Japan, test mid-October, negative prepared XX-day negative test. quarantine to He's all XX-hour great lifted he with Clearly, announced governor

COVID XXX impacted cases There's Hawaii, been for least the a about deaths. across XX,XXX me of all for frame the Let second and our among only nation listeners. in grade

schedules to XX% expected they XXXX are in XX% over minimize When want that minimal prepared expect on December. do don't the Hawaiian said We been you it's and XXXX airlines, XX% to believe I look also of pretty any significantly horrible. expect life be Hawaiian devastation, the in the islands the loss at level. is United Hawaii. we really Now the that really to two and in data. look the at historically looking out and of lower been our summer we booking to of look the there coming demand, airlines lot already the They up and next is West ramping remarks Southwest levels. about always as you significant months, patterns. question to and of a QX the XXXX providing so Coast are To be pent-up as demand they short XX% The the good probably answer is your and there's if scope XX%

encouraging. also So,

XXX Rainbow in in Village in hope and Village Hawaiian to we're Hawaiian to the so, I in -- Hawaiian open at of Hilton the we of will out will but nearly looking during towers Village, of Tower the XXX the one Hilton Hilton rooms about Rainbow the us here they're you the just XXX open, XXX the mid-December, For Tower of or the it the selling five next week selling or probably open if think going that Christmas. week

Now one be but XX% of XX%, only opening only the campus, tower. that overall may we're

reduced if in to XX%, about probably of hotel XXX really we're probably Hilton XXX to the about at looking applicable think that's a signal Village, the a XXX And hotel. obviously good Waikoloa start. XXX doubled So that's of room since ADR XXX Hawaiian but what's to rooms a and Village, down very nights timeshare on good out you Hilton been encouraging.

signals there's of pent-up good that think demand. really confirms I and lot again really So already a

that So X.X special to the island encouraged. and of X.X XX% about that one visitors of the historically Japan. coming of remain you if out about think and coming we the out places XX% U.S. of about of million Hawaii about million

this we're that that positive a is in So process. and first we encouraged think step

that only question that that to We we of people as begun that and that final randomly. Island Mayor the XX% the we is level also such of understand to and arrive relaxing apply hear considering second the Big testing the about your

forward think this we of So also that an will journey. in move we as less burden will be also a step be encouraging and

for the was selling were Got it. when maybe wanted assets kind confirm And past Sean, a you basis in just an the I low tax issue to of portfolio. of

be in first to fully, probably the offset losses I to this that shouldn't quarter but guess losses gains in asset taxable use your I future? you sales that would took confirm able be year an issue, the the any Given on as impairment be that to wanted

period we five-year Related question. building subject -- to good a the spin where are after tax. have we to Anthony, gain

thankfully big, year. of operational only So kind through beginning of but that take would essentially the losses extends offset not any next we

ones the kind tax whether from the XX the would of sell we we of there we transaction So XXXX the it's might be basis in efficient on have like feel that today where year. last whether kind it assets what have Chesapeake or solutions next months or ultimately we from be

on of continue near-term, offset as gains to that it going to So for the use carry dividends. distributable limitation. we net kind income in to have we'll relates and losses through eyeing are forward Longer-term, will obviously, we can still

Got you. Thank it.

from Our with with Aryeh next proceed comes question Klein question. BMO Please Capital. your

Thanks.

So there little of market? bit about of hotels about are and when that how Francisco to some open the you're a in closed, the remaining can the San challenges thinking market you specifically that talk given unique

Yes.

at prepared the being of in demand patterns. I mean, I remarks through. disciplined about Sean terms in looking of think walking great a we're kind we incredibly are the metrics did job

think opened, about we've Centric. closed. got JW Hyatt the you never Francisco, If the San They Marriott

We airline So we got medical personnel. had crew.

for Both October XXs. quarter and responders. occupancy And been XX%. in continued the those third on the hotels of averaging have even fact first until have high has in that We XX%,

there's a or able given business, So little transient. fact that's citywide maintain. no the good a business no But no sign to that there's little we're being or

rate mandated got is primary money keeping we You've and in that less strongly as lose actually and great here. we've growth the as them remote by doesn't just the encouraged make cash possible the or city work four made low hotels our by being the you've progress burn objectives remaining will closed. to point continuing at And sense one seen this keep again of

remarks not unfortunate. demand Regarding are our the workers monitor I either more a guests and nothing It ordinance, helpful continue safety before we to and costs it think think buildings It's and our will the or and incremental is assessment than is we It's job's for bill. healthy clear. not were reopen. a bill against whatever We'll we operating make there associates sufficient. is

We're a is women. about be believe it over men no one we long-term country of Francisco of and the doubt how to we will thoughtful in of and this great experienced very reopen going So the San team when cities recover. the and

reopening it's to side will the think in other prudent near-term important in We this. really of the the be We and disciplined process. to get

standpoint? kind that Thanks. but from Hawaii. on just booking market? seen Any from -- early a you that follow-up And then initial have window quick I trends know a it's Japan demand to with specifically, of change any

this no, Village. is again, we Hilton terms hear -- of this what it's Again, we Hawaiian We recent haven't. And and early. is in

into about of nights, from XX% HWV the XX% back Waikoloa demand international to Japan. visitation think the you room were look there our you XX%, of if XXX business in about in terms HHV, XXXX historically of about If the

some data years, been it's U.S. but again the coming early there. it's is mostly So that season gave -- very on too think that last XX encouraging particularly West fully over continue, color of the we're the already Clearly, I holiday give to that expect what the reliable. stable. give seeing been as It's will Coast. anymore we and coming We out really

you. Thank Great.

question. Our your Dori Wells comes Fargo. next with with from proceed Please question Kesten

everyone. morning Good Thanks.

Hi, Dori. you? are How

How you? good. are I’m

Great.

Is you Reach in think from points. XXX asset or before to minus? put your XXX thrown but for size margins So, EBITDA specific whether prior plus of portfolio yet The there range peak realized out that to location or anything have out either should that Chesapeake or most return some expected, prior gains hadn't you could basis peak and can RevPAR would gains I agree and Chesapeake that be

Dori. up sure. Maybe the make question little bit ask broke can You you just a again to

Okay.

out points. some So XXX peak should think for I was the prior be could peak thrown EBITDA RevPAR saying to and I that Reach basis in that prior basis expectation the gains points have margins XXX is return before

And it's expected of portfolio, so put your location I portfolio anything from positive the but that yet size haven't or there that negative? asking, Chesapeake was to is either out range this specific just realized whether you you could gains asset or

Yes.

I it's think question. a great

you had that that of think synergies. about redoing that overhead observation realized both Chesapeake we February. management and $XX the made million in If was We to deal, that $XX And our million both back was contracts. there by were

renovated way very that tailwind given long so -- our were very, well management there. confident that saw were encouraged saw over properties tailwind in So we on the my term. we strategies we both asset in the are We And there. we were the both we applying still

points of expenses $XX are of over couple the going again, on there. to big margin the the That's a business, we've of million XXXX reset point think in levels. out that about already taken that based basis that we as well I XXX things in to help made part

be disagree higher points. a points if basis at be aggressive little I more don't end of and on XXX look as use the they that that I to say could with the XXX Park colleagues the of we So range basis might it. even

there's I that's reset a real occurring. think

things of the and One there's of reset depending of in a the nice and on honest beverage. one that open food this we've advances the to of got got out be add reset. the like. coming -- that owners Clearly, less what some on We've to stay technology. recognizing cleaning brands is fashion have a to benefits dialogue of crisis going stay-over going form -- in there's be Obviously, to between guests

of is up think to think to improve continue the going either also intermediate and or which be over going I much permanent, I to margins going semi-permanent are to this and end long-term.

of the basis XXX the saying end that no we'd And in So side basis margin XXX that. be I on problem have to think benefit. Park's points confidently points I higher on

Perfect. Thank you.

you. Thank

comes your from Securities. Neil question with Capital next Please proceed question. Our Malkin One with

Good everyone. morning

morning. Good

like and impacted. changes seems most or outlets standards going it's brand of revenues out-of-room it to lot the with question are First the be a happening, the that

footprints they Just use down wondering economic of hotel to the is a things office oriented space? office how hotels in group meeting do it, that space? you those some to plan larger space are hotels, happens whatever we've reduced what the out of of your think as will that get or as to temporary turn do same-day space. sort One shut or you you shrink, or of things heard After call

total your thoughts of on your revenues? curious a component big that's Just because

think a It's your great really spot-on. comments are Yes. question. I And

a We whether that you're that the have it's that seeing of training. over people can centers. whether us travel, Do many going to for need incremental of and already that a of setting offices space it's whether the the some expanded of lot it's can and on being us in huge day it's a see some see up I satellite celebrations, evidence for -- less meeting end decide for of I think a more being office, many training, space whether for Park well particularly up -- what we're recapture by the incentive of whether taking and I we of and utilizing or the particular it's recapture office urban advantage the side. that I'll expansion

food respects less So depending that parts profitable it's net perhaps in beverage structured profitable. business that Banquet see but far which you historically has business as we been have of can other it as And know many on on been the profitable, more and positive. a and how the be real

the of Again think forward. moving University Xavier done an opportunity we've has What as NBA So forced what done crisis Orleans. obviously differently. that the we've this see we New with of us with all

here been sources finding just while everybody creative think to of incremental possible out box is the as as revenue. of have forced We and

Other Okay. Thank is you. maybe one question a Tom. for me broader

to I part on top, public capital lodging asset public? terms public to think a for your at about pay have need it the makes it a parties And hotel do does and to in do being if think significant lower you mean layer the have -- precious of fact hotels. look third you margin to REIT, that the of and to And pros the of cons equity ever pricing. I use manage swings mandated you REIT the you mean wilder to in your you're you of being public out also -- long-term obviously public? Just cyclicality, class REITs remain sense

long think this candidly reset debt the the worst that Yes. the a of the ask and also but that crisis think opportunity that of But viable business public cost I access we for to it's and I a whether and side, been given It's a an right markets to times. I build us opportunity it's that's on the we're in I tougher. equity fair cycle. one This think really interesting to the to gives an there's the understand think today, do question. point why some certainly the or scale equity expand Obviously capital a in is I future. platform platform. at also the lower having and on think in now all private and very a continue Tougher time an in for look having run

best do shareholders' We interest. will in what's

the and that selling And always in value. assets, -- company, selling said that's -- create the includes will shareholders' I that best we what's and we so, do interest whether most

it Tom. Appreciate

Montour question. your with with from proceed comes Brandt JPMorgan. Our Please next question

Good thanks And everyone. morning Good my taking for questions. morning.

into comparable looks But So September of monthly pretty hotels. at little some on that's of August and just gave a question and then release. found and October. gains hotels you in like stats the guys set you a the quick bit results retrenched looks then looking On guys nice just occupancy it some a there in like open your rate

a broader elasticity of design of curious price of mix take just back pricing or more the just of So that you're of that to function was seeing by fall? it elasticity moving sort demand is sort into down,

the quick Brandt, there we I a Riverside of impact, had in is that given they've contract mean is answer rooms to really Orleans Xavier the truly in kind of New the and amount a for half mentioned the obviously certainly we through which piece that of be first business business a that hotel as is there taken group of is relied won't next great mainly year. on

came Park. ramped So that the mid-August online business as students across up came

really it's to given month, hotel a a So impact but the XXX about basis XXX point to rate. portfolio to on that alone the

rate in see more if you or the kind normalized you of kind things that more of removed on So line decline.

what plan as And helpful. did just for game then follow-up. back a move OpEx for do. your -- XX those the above game level of in the hotels breakeven September which how hotels Curious bringing you sort really plan the is That's

going for be be going is points cash next to just you So you curious the flow? breakeven to what several of strategy are to or occupancy maximize the are for trying managing a

game the of the aspect of the buildup is that's think I name kind X here. based

very level kind any So we're of as every expenses. going point how oxygen to to focused be much on bringing back we're

on as look we're XX%. you XX% if catering. flow-through side hotels as the think about on It's obviously quarter-over-quarter, at on opened rent and room flow-through not which through the I we hotels F&B is outlets and flowing we've we're look bankrupt at just in the

ramp very smart will these kind build of they continue up to hotels and the as occupancy very, we we're do and So so. up

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are thoughtful we're -- not, clearly, views certainly about some F&B certain on very providing offerings. at whether certainly assets that. of as the guests. some or kind operating we to on that about very kind some the amenities the that these open of getting occupancy there garner some apply and we're of hotels times And But to come learnings we're XX% conversations we're at and the we're side, augmenting So, to we we seeing they thoughtful some other the kind how to do of but of up XX% through,

really answer think we business as be bring you a at to lot to and So don't we disciplined back. have going I but certainly, this point this give of it's Brandt, numbers very

luck. it. Thanks for Good Got the comments.

Thanks.

proceed Chris Woronka Bank. Please question question. next Deutsche the comes Our with from with

Good guys. Hey. morning,

Good morning, are you? Chris. How

ask XXXX, you’re transition think I I group you Hope, about want anything with earn actually and there's comes have you'll think the group Tom, did in way kind XXXX no back possibility I doing have year, a that all or XXXX but concentration also. you in very really it's business And thanks. doesn't in do XXXX? mean, whether well, Doing well XXXX higher know Do what and XXXX. that you you of do say XXXX? ends you to it's up, to it's a where group matter early, than

question. demand going candidly and great until Yes. and accelerate believe my in a we that widely to I place in don't therapies is And remarks, Chris it's are really said the prepared adopted. vaccines as

with rhetoric better. And convention and social both the if certainly a of of getting demand our pent-up we'll that you So XXXX here we hear But believe peers out months -- discussions XXXX, business. in would lot second and the think the the for business, what tentatives distribution just see few will favorable coming next but half there process, group of I get announcements well some begin be the the we as XXXX. business, of given we in

if for it, doubt, No And to that the little levels that think to XXXX, leisure to back going continue I we provides, group see beyond get side, encouraging a accelerate. side so, on XXXX the could faster. XXXX you're and signals on

for interaction will the going to is back. again, I and business. we all the to to go people that be we've up OTAs And all -- slower of think side will able come [Indiscernible] doubt on We're in once Another today. conferencing, to of We've -- That video comes travel destroy it and probably not that in have medical to we the being the home. business this away go the all to heard those. going on in of go, we but no jet have about business come age COVID. to transient core the as survived be side, the how business together lodging little ramps talk continue that need business and challenges same a other day back

helpful. It encouraging. Yeah. sounds That's

blurring you your guess The some you and up full-service at select-service, particularly newer and the And peers hotels, How the do rate full able see we other as about I hold service? integrity service if urban the the levels that between is be will these ones. the is line question of in select-service much cost structure think different? especially reimagining to question are

Yeah.

question. proposition value be the to great Clearly Another has there.

may change, and food may the about service think And beverage room experience so how change. when how you

I more think be I a the reality profitability is limited could from of wants standpoint. net customer and touch knock that and probably that that that the And positive drop. point think a

not As been terribly you service the has room know, profitable.

going sources banquet and change be think to I think revenue. the meeting on platform how is other I there'll the of

don't business it business I a if we right to getting full-service So commodity way. the manage see the

know more select-service that I It's the and more the well. commodity amount a secret's just sector given of out. and the supply I obviously of think becoming on

we our and and our do very are given I the so, where think encouraged. footprint And have, assets that we're located optionality

out As we hotels. portfolio long-term footprint we intermediate as look look our XX really the core really to the this future, and like very tough particularly environment today like of

Okay. Tom. Very .Thanks helpful

Thank you.

from your question. Sachs. with comes Our question Please next Stephen proceed Grambling with Goldman

Thanks. Two questions.

are capital, conversion engaging you potential timeshare be in and do then second, considered management another First, considered managers are in should brands? structure in contracts or what better your being And is franchise align to what the thoughts owner and leisure? of given a of source especially on the strength think changes

questions. Two Yeah. great

is it how given it's seeing think benefit we're I Park obviously, another I timeshare leisure, of and growth in the and the portfolio. think the given resilient business

optionality number you provides us to will think on situations in I lost it us of a explore that and not for see continue that. us

So, be the and the again, timesharing could size, fees. into our footprint given distribution given that having residential and our resi

also and side. rather marketing value distribution, team not model works and but this I think think it's have And That's rethink are something capital-light a management all about whether through explore. owner sales it's So, say we phenomenal of just about business loyalty it, the done that I that. whether a programs community. I the There allocation how clearly think we it's And will great it if us on even that and that's our they a that is asset whether labor. the forcing healthy negotiations we through just you the lots allocation would question. million only the Sean into have get continue costs of job. $XX to would think not if to Dell'Orto proposition,

to business. cost -- the excess it lot think so that companies need the more lot we our collaboratively management -- our partners put work system are to a and brand bluntly, out cost in more a we there to And to take with

both quick think do the hotels I One you versus resi valuations you're COVID in discount seeing follow-up the and versus are the on side. timeshare very Thanks. where are and timeshare Those now? helpful. pre-COVID mean where

question. have fair It's Yes, that I with a me. information don't Steve

focus laser-focused and go sheet a a and relief the made our been. back-to-back working that's just on As has out in we've by Keep team. of how great hotels execute Park proactive are extending on women the priorities, tell you team need and where to were to burn balance and knows But covenant progress the getting mind profile. we can debt lot the cash the our had and the to credit men our we on maturities. reopening way we given on to our did This

asset embedded timeshare or You'll for have explore it's footprint a see look record but said us continue a sales time. and that optionality lot you'll out we're and XX% we non-core whether work we I creative see track we also where to had value there's replacement costs. And in at resi to us ideas whatever, also prove know strong a the to over as on continue of earlier today discount given trading lot it where this to will a of than XX% more We we'll trading we're lot portfolio.

That's great. Thanks so much.

Our next UBS. Robin question proceed. comes from with Farley Please

questions Thanks. have been lot already. of asked Great. A my

the Thanks. you value plan than had you're in long-term curious had that pre-COVID? markets sales. I back I'm sales thinking you're to more to likely what been are talked your about sell in, about now but the seeing you the there for core Just know circling assets asset asset just whether --

a And a that Look it's fair do through Yes, the coming low as portfolio. some have tax constantly historical assets base. question Robin. we Sean have are there mentioned we

some that to have we are assets are We a some that higher; assets private think more family are are there that equity. office attractive

we've XX the as the international, and selling since in of spin European highly had tax all So, know, and dialogue. we're that of XX locations. success goes you and were engaging into which the sausage of lot the a a maker complex that legal whether sold as assets all We've

always is So to we have have XX% we're not discussions. we Where to. that in We sell to at going discounts. been don't hesitant XX% are

We going have know narrow, be particularly are we where reduce there the to we other visibility culling. look We but are pounce that prepared and markets are we'd and our to long-term concentration. for the quickly markets, a liquidity. to more move see it's us. you'll some just There also not but natural will be us like great are can these markets to There and side, get other gaps as that get

the team. about be decisions thoughtful see continue so disciplined make and us And you'll we as to a

Okay. much. very Great. Thanks

Thank you.

Green Lukas from question. comes with question Hartwich your next with proceed Street. Our Please

morning. Thanks. Good

Good morning.

morning. Good

one for quick a me. Just

front, on are normal having you applied operating there aren't those operations -- environment events? we think be will people So the efficiency into once learned do a where to be to group that lessons group able get

lot a a team partners. and and question again spending our asset credit operating We're Sean and -- Lukas. there it's to the management great our of men women Yes,

just starting we it's And labor, getting customers how it's from are adapt blank whether a rethinking, can well. and whether with that technology. We we're desires again, canvas response as

can profitable can thesis this efficiencies far it more certainly more think see could and to to I come going an as investment So business forward out. be and intermediate more we improve long you're reset. term. We continue move We a and can as get we reimagine in the

Great. Thank you.

Thank you.

the to this reached Thank to I Baltimore of the remarks. like back closing for question-and-answer we've time, would the session. you. call turn At end Mr.

many will you stay We of that virtual for of We forward today. the our and be upcoming and you all with Nareit to continuing taking be Thanks well. and discussion well. you hope your time at safe families look meetings

does This teleconference. today's you. Thank conclude

disconnect may this your time participation. and you for at thank You lines