Park Hotels & Resorts (PK) 23 Feb 232022 Q4 Earnings call transcript

Greetings. Welcome to the Park Hotels & Resorts Inc. Fourth Quarter 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. this being note Please Instructions] conference recorded. is [Operator

conference your host, will now Weissman, to the turn begin. I Ian over you may

operator, to everyone, fourth XXXX and Hotels call. you, earnings Resorts full-year quarter the & and Thank Park welcome,

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

differ and these in and that forward-looking statements. As earnings results that to numerous periods Actual may subject are Note described statements basis statements. a materially could future future comparisons to expressed or our performance, these cause are as publicly in expressed those on prior our revise in SEC, year filings from outcomes results obligated are not release. from to and we also to differ forward-looking with comparable uncertainties those the update risks defined

filed to that statements. differ the on contained forward-looking recent reports the refer SEC, important in from the risk Please and identify specifically documents results Park the to most cause which actual risk, XX-K by Form those with XX-Q could factors

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

website the can pkhotelsandresorts.com. in with in together You information reconciliations directly at and the well with SEC measure available the this GAAP our comparable our information financial yesterday's to on as find release filed earnings most as X-K financial supplemental

guidance. update of balance a provide Sean quarter This and Chief fourth on an Baltimore, Dell'Orto, provide will Financial Officer, review details performance and Park's Chief further sheet on additional Officer, Tom and morning, our our fourth on liquidity and for our Chairman quarter results, will color outlook XXXX. Executive

open for questions. we the Following our remarks, will prepared call

like call Tom. to would over I to the that, With turn

overall widespread XXXX was the Thank you, year continuing and witnessed balance for sheet. throughout incredibly an Park flexibility in and to our demand the strengthen we while quality of as welcome, portfolio, improvements productive Ian, everyone.

as allowing the a broad-based all businesses office, whole, the benefit important travel around a XXXX to resumed demand return industry and of travel was year majority globe, the conferences the an across segments. lifted industry For as recovery the from to were restrictions

For in with to group results business demand the and deliver saw strength for combined ongoing year, throughout portfolio, Park which leisure the the healthy transient we improving full-year. demand

projects. the of ahead, in recovery sheet on continued in XXXX, we markets to management operational and In backdrop increase a realizing in urban for prudent Looking efficiencies, favorable our demand group operational balance including value-enhancing in and strategic outperform. terms focused excellence, remain priorities provides Park investing

translated reimagined the reap model benefits and the We to versus that XXXX, expected positions XXXX X% during continue to reduction a pandemic, or developed throughout costs X,XXX operational were XXXX. from headcount target our lower of are approximately above the which into XX% remain labor in

sheet the progress capital XXXX, of $XXX total of substantial the raising overall our also improving efforts million both We modification initiatives. our an increase to our our liquidity made in last approximately balance debt due and quality to XX-months $X.X recycling over billion,

times XX.X recycling million at early non-core announced of were in February. recently including EBITDA the XXXX, sold the XXXX the capital eight of the in Miami $XXX we front, interest hotels On $XXX were Hilton since Airport million start sale

depending defense, recast team, and internal to these and Additionally, Park Thanks efforts with exited waivers execute offense certainly out our our on December. external $XXX in the with initiatives, flexibility market growth to to maturities pushed million pivot positioned and covenant remains we debt of well and the on revolver conditions. between upsize incredible the our by

portfolio. portfolio embedded over in continues at expect XXXX, projects continue of existing Excellent quarter we half completed In spent unlock ballroom Waldorf year, space throughout the were the are on to expected terms across priority this our renovations this expansion by of we to million we to December, ROI invest past our increase to at our to renovation $XXX Signia million with in nearly strategic as our progress $XXX of the assets, at the and meeting value be our along meeting completion Bonnet space Waldorf with public new full XXXX. platform lobby and rooms, the the of hotel opening Creek with a fourth opportunities

expansion renovation world-class QX to Signia finish expect renovation XXXX, resort. course $XXX Championship by completing the of full-scale the the a We platform golf of meeting this along Jones Rees five-year with million

which full of year. the also investment, and beverage Casa to finalizing our and Resort including public our complete $XX outlets. include West conversion plans are iconic A renovation this a space, its rooms Curio at We Key later will million Marina reimagination in a food

change implement more making plan climate also to of the upgrades mitigation renovation, during issues. event resilient weather-related our in We the asset

renovation fourth the Phase the the we Finally, phase of fourth this the for year, of at tower and X,XXX-room also quarter at spend culminating execute million completed Tower during the rooms renovation Village quarter the Hilton in X CapEx third project. Tapa in and the final to Hawaiian $XX of of total expect

$XXX in of and buybacks. dividends shareholders of returned share over to stock XXXX, million capital common Finally, we form in the

QX, reinstated payout share. we a dividend in $X.XX our Beginning full-year quarterly of generating per

stock discount valuations, so of back of $XXX another significant to given of we year addition, asset for the dislocation a million of stock repurchased XX value. a addition to public In XXXX a ongoing net bought in between last at million in shares total million over private far $XX and total

the X% to having quarter if were in with above leisure in Looking Orleans. New markets XX% increased XXXX recovered Francisco. In year-over-year, results. hotel XXXX markets fully and like San our fourth we -- of have was Hawaiian of Hawaii our RevPAR that RevPAR fourth rate ahead at New XXXX and XXXX. Village daily York, group resort by demand results fourth healthy average trends quarter, Hawaii, strong led X.X% XX% quarter Hilton Results levels and to XX% recovered exclude for Comparable recorded within increase reported

finished since million, quarter contribution EBITDA $XXX Hotel the over annual an group XXXX reported quarter its company's our in strongest highest XXXX amount with and its of fourth during history.

believe we With and the encouraged XX%. XX% over off for While Hawaii, growth very international Japan by levels in tailwinds pacing continued we demand fundamentals XXXX below still been remain. have by strong

Japan XX% village. represented of demand reminder, the nearly a As historically our at

island the result and of resort accounting Entire Key Turning our that in seen market the was within for negatively compression, demand quarter. reduced to faced Nicole has XXX only impacted Florida. fourth a basis island portfolio West hurricanes RevPAR quarter, notable while moderate headwinds as the drag. also points the in Ian of

still for levels, $XX while at disruption of excess the expected to of second-half of million overall. points in Casa peak the disruption flat likely Looking to Marina basis our $XX EBITDA the Resort ahead down full-year prior renovation XXX expect XXXX, transformative to to be and million approximately Reach RevPAR of XXXX, we is RevPAR but account versus of during year well

urban expect urban during rate most Boston strong as XX% and nearly to quarter Hilton quarter York New year. for drive averaging D.C. New quarter group which and Performance at we the or gains ongoing better-than-expected led the markets, demand both by $XXX the Orleans, rebound saw levels. The during with We subsequent was ADR compression recovery York, solid demand, of the accelerate fourth to in that was above XXXX this our occupancy by New helped in markets improvements in driven

quarter, million an sequentially million by fourth over margin EBITDA Hotel the to EBITDA more adjusted Hotel QX result, a XX.X% during quarter. XXXX than $XX for over $XX the adjusted impressive while increased As was

to growth continue We expect pace XXXX to expected momentum RevPAR in period. both XXXX adjusted to that levels with Hotel for and same XXXX into be exceed XXXX the margin EBITDA above

Turning to San Francisco.

were will We and improvements JPMorgan encouraged weaker Our the by Healthcare And in support expected. ongoing several a QX green performance believe we city results encouraging was that following in January's shoots help XXXX we preliminary very than beyond. see Conference. successful

group nights to year, XXXX in to expected continue First, from expected just of this XXX,XXX demand Center XXX,XXX Moscone improve generate up the is citywide room XXXX. nearly to with in

have city several international Xx welcome the routes activity bringing plans as the or international spend Second, key year, to in was in airlines throughout XXXX. spend domestic economic nearly announced return expand

now are than to Finally, focused more reimagine ever both and business the reenergize political and city. leaders

taxes, city's while to two to and We overnight. weeks more economic the announced to meaningful ago initiatives, continued with base growth recovery will expect measures [Indiscernible] San health Francisco's contributions change fortunes the Park's safety designs do nearly recovery that years. over lead including incentives, XX see not Just to diversify employer an earnings plan few and will next

segments. in XXXX showed our of In started for to forecast in revenue improvement million accelerate expect The group XXXX. strong $X approximately further and terms by exceeded QX our see a a over in X% demand incremental that is or and portfolio tailwind XX% revenues to QX. rebound we group

booking window see we to continue are encouraged also to the bookings, short-term While group we see robust elongate.

concentrated million during $XX the New by was new XX% gains is levels. points booked to in Group business XXX Francisco, of XXXX end increased to revenue QX, XXXX group York year, from Orlando nearly of with pace at time and doubling XX% the pre-pandemic same and the In San basis quarter pace last for up XX% revenue of for primarily QX.

or with out December XX,XXX XX,XXX nights We XXXX, over nights over XX% December's to by the year. in San room led of for look over pickup alone, Francisco room booked were

demand stronger Orlando, across by to travel Hawaii earnings Park while citywide positioned markets these and in driven strength trends, year-over-year Given remains core our should business resort urban ongoing support impressive calendars growth, well and accelerating very generate like markets. pent-up

$XXX guidance than to Accordingly, is with adjusted we X% to and respect Hotel range RevPAR XX.X% driven wider while full-year million establishing XX range we uncertainty. improvement based to ongoing basis to point on XXX With earnings, to usual are prior between a growth $XXX the million, margin to be anticipate and year. range the adjusted XX% over the of in EBITDA macro of year-over-year by XX.X% EBITDA expected roughly

per Adjusted be forecasted guidance share. FFO share between to $X.XX per is $X.XX to

manage XXXX, priorities core upgrade operational by as renovations remain the ahead As to continue our laser focused the operating and ROI model, We portfolio we portfolio we and reinvesting continue in selling to look the and projects. excellence with asset are and value-enhancing to on our heavily and reshape we aggressively improve unchanged. assets will portfolio non-core strategic

as call first With that, as quarter to turn the on Sean, to details our further who performance over additional expectations. like providing I'd provide details well on will

Overall, very Tom. with pleased Thanks, performance. our were quarter fourth we

was XXXX occupancy was noted, ADR as Tom had just or X% approximately stronger came shy RevPAR at in $XXX slightly And XX%. $XXX expected of at than As levels. we QX above

was was QX hotel EBITDA comparable while and comparable revenue EBITDA margin $XXX of The FFO per in comparable the Hotel was EBITDA XX%. million million adjusted during quarter, was $XXX adjusted $XXX share million, adjusted $X.XX. nearly resulting Overall, adjusted Hotel

balance the Turning sheet. to

at liquidity of stands debt million XXXX. billion current or the approximately since currently $X.X nearly beginning is Our while $XXX $X.X net billion, lower

loan CMBS the our and Francisco Hilton million quarter. We address the matter two given in balance will continue on our opportunities evaluate And confident to $XXX we third matures are before we addressed several to our November. Hotels, which San have sheet liquidity,

developments We everyone the will months. apprised any keep over of coming

Looking the Southern and with California to all quarter, ahead gains. to expect Hawaii, year-over-year in markets improvement see the across Miami greatest leisure first continued forecasting strength these urban portfolio Orlando, with of our we

in group during softer with Softer quarter citywide the as first headwinds calendars York will key New Chicago, such trends expected. markets present some

remainder project a trends for of QX sharp the group the acceleration in we be of of a rebound to meaningful expected However, with driver solid beginning performance XXXX.

is forecasted $XXX EBITDA basis midpoint expected for of expected $XXX range to with XX% point are million is guidance range $XXX the XXX margin $XXX over adjusted prior year-over-year the year. XXX to between establishing of XX.X% Hotel and EBITDA QX million, between at improvement roughly RevPAR and we to to range range. the between growth Adjusted while and XX.X% Accordingly,

by basis will Omicron cancellation during impacted margin be approximately outsized points income QX of versus related for prior improvement This XXX XXXX drag negatively to recorded accounting year.

Note per for should nearly which periods. the full-year from million Hilton these that $X.XX FFO between removed share and time expected QX Miami adjusted guidance of announced recently range Airport and earnings respective Hotel, $X sale considers $X.XX. our and Finally, million both $XX

our Board share, per QX while quarterly current year by on guidance forecasts, to full given uncertainty. subject macro dividend. aligns recurring which the to the first expected with the are to approval, dividend actual is amount of recovery more dividend remaining the occur Note mid-March. a prudent and of constructive ongoing Turning the we of views that which quarter $X.XX Based is targeting

a his comments, million Tom has year, past stock back bought in at over as noted to Park over NAV. $XXX Finally, discount the of significant

currently to continue no still We private is capital there in our widespread believe between valuations. than better of use that market company reinvesting public our and a with

stock Park report program. buyback the to replenishment a pleased approved Accordingly, am I Board that of

Given the years, execute company we two will up the basis. of on a the over common ability which to to $XXX leverage-neutral prudently million back next buy stock

our remarks. prepared concludes This

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

Sure. Thank first you. Van Compass your Our Point. comes Floris question with question. from Dijkum Please [Operator the Instructions] line proceed of with

for Thanks my taking question, guys.

Floris. morning, Good

a Good morning. -- guidance for as obviously, thank believe we're well you to be that 'XX one, that and providing as And to appears you hard quarter first you go through guidance that recession. about Hotel going not the -- I you're a envisioning for your of talk little landing a maybe can bit to that the some just if get wanted you economic sense sector. of -- backdrop

Hawaii Hawaii maybe and well little your EBITDA. one if specifically, I in ‘XX? million you and bit more yet Maybe things essentially gets come should demand $XXX the the start at could still if and there million EBITDA? mean, because your mean, a outlook comment you back like of are it It that I on then be the you Hawaii Village this in that. with been to I'm traveler And is by Hawaii performance feasible seems it as in hasn't -- amazed can of of $XXX above assets hotel the

sort the for faced say, with you obviously if of we hard we we facts There's were and the the lot with to to what were I thank pandemic during that given step but and and back reimagine really operating work Floris, start the I'll Well, clear Hawaii. circumstances you to needed a crystal question. Look, model. would unpack,

You've call. call after it heard me talk about

across I an think costs and that portfolio we this -- having lower. entire example can XX% continue to see the is labor were of that,

If eliminated. you obviously, X,XXX about, that have think the been jobs

were these so working really management redundancies costs taking the thought these it's collaboratively where board, areas and certainly hourly, partnership efficient, in talented be but And are our of our both there management not are again, really asset -- out business. we across operating and partners could we with and where more very team the

about back comparable. generation as where REIT you humble Empire is other that sector, the There worth much Hawaii, continue as a building a across in much my to more to in is and think any a asset be world-class has As opinion, not, people generation. it maybe That's resort. another following has story State history would go after

investing are there. of We money ton a

we're As that renovating tower. on the X,XXX-room we tower also there. mentioned, Tower, working which sixth We're Tapa the

correctly being So clearly, a of for by lot XX% and XX% of stay also and they pent-up demand, but and for that kind consistently the U.S. longer, have spend about -- of demand you more. and met or have they they're to more who about Japanese while and really that XX-years demand, going accounted out pointed traveler the travelers, been

really experience size. So for we that million improve think that scale to continue there, traveler and absolutely. your it and thesis invest in there upgrade $XXX that to as of the and And anything isn't I be continue could or more, comparable to

also $XXX encouraged, really we're doing talk $XXX-plus we're you in we're excited Hawaii, Creek about that we're -- about about, me excited million really putting Bonnet Resort. obviously, heard the million So And for what Orlando. in the but

and are going thrilled have sure that We have an we're Truly and completing quarter year, it. at investors and an of we'll event see be what for of completed this we to year, to end the there. next analysts make first that world-class to opportunity

I'd about observations. great your in time make We're Regarding uncertainty. a couple question economic of a of backdrop,

resilient. inflation, a peak. all that all the market. There appears in a are improve And despite but geopolitical, we past few war that strong of Inflation things are all think of rates, whether there that, There's think that. I really I labor consumer outlook. it's Ukraine, to interest -- I remains mean the the know help be

Now the it sort through most it of of I mean doesn't believe completely. think we're that experts But peak. past were

So positive. that's a

than less feared. Europe from is drag The

the on everyone really mitigate was what recession better the by there, but think of the about there you think, addition and positive terms China, leaders but also the helped in planning have doing restart. policy of COVID winter If I U-turn better about impact that. impact really the supply warmer thinking can also, chain certainly deep to encouraging I travel, signs. possible Hopefully, have relations, that in we're think getting we helps on to a

it's But period slower net-net, certainly, So fair fair think, landing say, a think, sluggish to of a recession. and I certainly is, I deep a deep or not soft a certainly forecasting We're base not case. a recession.

and given outpaced earnings in the got But think to even reason a peers portfolio accelerated RevPAR year-over-year. think of to we've green growth. be for X% our our that with XX% of that diversification a that, of shoes Park going are that really don't range. many provide tailwinds of and number I Hence, the I

as tougher and 'XX we but very and think period, the So had optimistic. a Park in very we I out outlook beyond for strong is look

are we encouraged very and over long-term. intermediate the So

not your and your My would paying your debt, completely? cash that what would spare the balance be loan on would off CMBS consider using earning earnings sheet you're not that that Thanks. on maturing than on pay may guidance, be, Sean, this for you expectation, to the Sean. assume. And to you're the do follow-up, I because cash why on but presumably, your less in the would on balance -- is again, sheet

it's money, Well, our a say it's balance of close cash as that as say of to being ultimately, billion I a lot important completely $X.X going I million, that more is pretty solution, with but down. what's That that certainly cash it's looking earned. would with little in it's X.X%. clearly, think of at certainly of we off our on of terms -- we it we're overall liquidity the have today a debt would be on still wouldn't kind of pay sheet. balance say part And about that paying sheet, I $XXX certainly to part

I would is add we of sheet sit right have the also where strong. Floris, that, is now the -- look, balance we beauty

that the we've few saw You again years. last measures the over taken

got have do or number the have could out And we We're of that optionality. will quarter, not to We can assets. the We -- put an going third things carefully. assured, study a on if We situation by asset we we've combination servicer, it can sooner. here. solved to a we rest debt But extend of different could reach optionality.

alarmed. to at to are and thoughtful. So outcome. measured, be get We're going we all not to we're right We're going going to be the

debt. And this We beginning example the we the XX% used we We did was I maturities paid of world we didn't when the much had off going to maturities. closed panic. and at deals. the bond thought Park -- bank wasn't pandemic pushed out off We've longer, around debt three be of paid and everything now

You'll we that when was revolver, we It with to note the quickly, efficiently, arms. us to went that upsize were environment. our were able in open of banks one the few done that recast welcomed and

a know We So here. how situation. to team the handle you've very got experienced and seasoned

will it to study right We carefully and outcome. we'll get the

guys. Thanks,

Yes, thank you.

comes question next with Pfennigwerth Our Evercore Duane with ISI. proceed your of question. the line from Please

Good morning. Hey, thanks.

morning, Good Duane.

to you. Hey, nice see

thing operating higher-cost flexibility flexibility Is inflation, rate urban and your I right less markets versus Just a labor, wonder to exposed having good increases labor your less high labor on relative peers. you on were now? makes cost already in so where rates actually, geography, if essentially

for fact suffer and result, seniority, great question, union of higher a for challenge and a to. we that that by us call a wages of been had a was us. that have have I partners Orlando many -- extent are and well of because think we having you mean But because of West to That was our labor We've recall market markets, there's a and we as piece. chase spot to with an markets. particularly And doesn't perhaps our the embedded part everyone. on. a advantage perhaps rights, that the It's working didn't One, another a Key have to challenging we some for challenging labor had challenging gives as market. benefit. peers our been market it a relationship didn't has

those the you part expand a year, just Appreciate continue the and year in returning bit on the when given kind pick Do view traveler of meaningfully run Hawaii. that of of thoughts. to Japanese this And to maybe just some you they first the expect a would little that seasonality of have to to incentives maybe up?

the tour of with contact It's remain the operators. half year. in second We the

those those your weddings, that But So -- and travel. There's want obviously remind a X doing lot incentives annual in of of is now we Japan expect right say of we And -- occurred. remember now. yen number not observation over not Sean were some of having years some Japanese I keep over dollars to of right. keep fully we're me, I have the basis that can't can on XXX the but to

we and we'll expect So that that than fair with back, more and back significant they would get energy, we come spend. and they certainly our when share stays will expect fully longer come more

very we're that. about So excited

as you've that, remarks the a it in the question, record heard Despite was and year. prepared

property that Now of that's record of amount year our size the about of of and size the EBITDA, a of about peers. some one

upside that of at in with resort. huge it sort to world-class perspective, put So

thoughts. Okay, appreciate the

you. Thank

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

good morning. Hi,

Anthony. Good morning,

question sales. what of Tom. morning, last year Good you're of and this with that us you to this year lot still on incremental in a Maybe start sales on made terms update a asset asset achieve looking progress It's year sales?

reshape, improve Look, the sold step laser-focused if -- back we disposed or now, XX spin, of we've to and you just sold $X.X on portfolio. assets, about upgrade are the billion. Anthony. continuing since And question, Great

bolted the about mind, upgrade We XX our the improve But assets company. hotels the of from the XX% as that. XX of and also Chesapeake of in the part for to to account deal top we want on value Now continue portfolio. keep

And able there. or sales. invest to last continue to into progress and the year, continue we'll But recycle obviously, constant X will those it back for we've and another reshape -- Miami, company did be use to million, if basis. been So portfolio. $XXX to able you we asset year, again, There's make million. nothing as that so back a to to We're upgrade we're on $XXX million include this confident be we'll continue $XXX buy a stock those to us the leverage-neutral proceeds targeting

And a related kind Thanks. of question.

on company, think the the you've XXX the guidance think a highest positive. public I of been ROI I CapEx for as lot a year, XXX, since to it's projects with I view

may over buybacks So that and allocation. this time approach your you projects cycle time capital ROI it's ROI maybe more projects of and versus

you Anthony. than as question, certainly investment, count find portfolio. Great the investing Yes. at Sean said his that We'll of stock. you back in remarks, right to trading when NAV, Look better back seek we'll buying be are expect No in discount that to this balance. prepared can

So we'll the the on at find portfolio. that same balance of investing buying a time, back basis, stock in but leverage-neutral

our project. now the plus Resort, mentioned we is that million the north Creek is We're putting that or in going Marina We about success. the the into guidance. baked be which property what well minus. a Reach closed impact will five property Bonnet as EBITDA to a We've huge $XXX think of the Casa in given completed West, Key to we We've we're complete the the few, is disruption, which in there. as probably a months, Casa Just Marina for sister the

the to and know extraordinarily how best We by seasoned. an led this. handle industry, Carl team design talented Mayfield, have construction We in

extensive with the major dealt hurricanes, projects. We've

we're we've get done the phase Hawaii. We'll teed confident So able the be Tower also got this and that in it final get year. of to up we'll Tapa

thoughtful, little but we pandemic a chain We're handle well, sector. know issues complicated during supply look, that as handle obvious and how strategic. the are we anybody reasons we as know we making being the large very well And for planning the paused the in projects how to to addressed. the it, sure all obviously So very are

Right, thank you.

you, Thank yes.

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

looks to low you a the at just I the your Because to end Hi, wanted and back quarters circle of kind -- maybe on RevPAR morning. up high three end? digit kind the mid-single the quarter, bit the margin to after if slightly are at it good Hi, of zero first remaining expectations. down outlook little year maybe of like

margin move Or more first and into out with a balance can still the I the be And mean, through of you sort flattens that it year I packed expansion RevPAR quarter of as you margin guess even on sort the you we would think then sort year? do expect more expansion, through the of of that to -- tepid the expansion. growth achieve

at Yes, Hey -- as more the relative that at ultimately the year. Smedes, the back of year least the of year -- comparison? half obviously back this is talking I assume Sean. kind on Ultimately more half good think level steady certainly, at to I you in look pretty yes, holding margins can a a kind we feel we about little ultimately, I of of range, you're bit think -- think yes, we prior year-over-year

at look forward. As we we of it, kind move clearly,

which only for think relies us. is year a amount mean the on up of group group great a picking I our good it

remarks, getting is alluded is time year same strong. in Tom pace last his stronger. As actually the to the think We over it's

most year good to And so the in F&B the costs, better along size a side other positions. position add lot on being in a we flow-through for to bring group of we've banquet over the drive we the the have, feel while a some of half pretty looking generally home catering margins, we of like comes of kind especially that good back the feel about -- we essentially, as to types able fixed, with talked the and kind of now. and part, of right next We're now about not labor the

we structure. the think have I in well cost in So the end, pretty set

actually little little a than bit on a even can RevPAR the bit we decent think side, it's a if see I So flow-through lower expected?

in Okay. be seems And just industry. wondering the a well. maybe rate-driven, as fair this I that way occupancy-driven mean just say in that theme year it's of RevPAR, to sort to versus you're it's which I'm if your more But thinking composition of

it we're Exactly, opportunity as more That's a how Smedes. well, lot rate. about certainly thinking than

you. thank Okay,

line Truist. question. Please Our Patrick the with comes next question your proceed Scholes from of with

you, everyone. Thank morning, Good operator.

morning, Good Patrick.

When we you. think bit X% about think about the that RevPAR travel towards leisure might our that would in down think of lower the specifically XX%, would more look X% set, Or on full-year you Thank little RevPAR end how that? you be guide the range. the drilling a how XX%? to customer Would to

end, And imagine the moderation in you've terms I the uplift. had markets you've where tremendous in of can the you mean, RevPAR Southern got improvement lower certainly, year-over-year, some like on Florida

well And ahead some still in have I Santa seen I so say be Barbara places while But growth, again, range. ‘XX levels, but tough year-over-year continue of moderation We've of some positive performed they on asset, well from has lower as end comparison, the continue the like a our tremendously. to still comps. think to would we're we'll

Hawaii is ramp certainly still, trying the was of to I think, year, strong still last and it half up. first

that think, have it's as some, been. I easier comps we market great as So for still

in the the the see that the I comps year. pretty we'll And in of half first ultimately, year. think back we'll still strong kind face of tougher half of

through rest certainly year-over-year, leisure and together, I the urban end little all certainly growth we you have in see build So put a year. you lower versus think, the the as of QX end bit on it the being where tremendous certainly, certainly

color. me. Okay. for Thank That’s you it the from

Patrick. Thanks,

proceed comes Capital your question with line the BMO Aryeh from with question. next of Please Markets. Klein Our

that's What then you on good from XXXX. Maybe did improving and are What standpoint? outlook do Francisco, there. this think I there? you you just a to you about morning. year? And mentioned flattish transient EBITDA seeing look San What like think business about Thanks in group

in EBITDA San Flattish Francisco?

I the for think is ‘XX, I For what the it think that's -- in full-year?

Yes.

flat, zero. it You said was certainly

Net zero, yes.

Yes, being appreciate were you and certainly we diplomatic it.

and in kind Francisco, of Chicago, be particular, in of thought people thought ever Francisco recover. New you'd of what York everyone Let's look all It's situation complex. think you ago be back is if incredibly -- in York, San honest. before years New case been San interesting, has It's the at the year and and they'd San a certainly trends and -- Francisco you

what minus In October down in first quarter, York. in in the Look were down XX% New X% happened ‘XX. quarter RevPAR, plus XX% of the fourth open in in we down up XX% or and Hilton at quarter, until QX second quarter. third the York the We New then didn't

that just about think quickly recovered. how So

San Francisco of that the of not and all, were May, of first part Park the latter reopen end We we until story. -- down didn't was ‘XX. the Hilton XX was

down bit up XX% a then back they're down XX%. rallied and XX%, little and So down at then XX%,

think doubt, give things a lagging But are been optimistic. it's and I So no been us to certainly, few and we encouraged it's signs be frustrating.

compressed, market XX,XXX They One, more smaller, last the power. passed conference There's have a was times that's market expected a only to this nights test. JPMorgan test. is versus It year. year with the the in XXX,XXX time it which big room gives real no There's XXX,XXX citywide rooms. pricing good

been number our figuring a listeners times, finally, the it's the out have only tax again I out reimagining alignment, political between we I buildings an also going referenced, out. and continue March they to and can more are there leaders. to know I've how -- plan but XX make not that business We reactivate underway initiatives there converting go think it, in will that I'm forward city. real believe, And than the and of incentives, leaders whether out put prime, ways to But cleanliness, mayor

that So more business very back to then we encouraging standpoint. more group of green continue to get the and from And coming shoots city.

the self-contained nights just XXX,XXX Park we I Hilton have think that room the and the got complex there, XX. we've within

transient. base it there get leisure going the now the effect shared anchored you, and flywheel But I unknown do quickly with I story recover get with and New going I think group the business you that as The get citywides do Francisco, there, is the York San get can you and if not. big it's and to the as

you think ‘XX ‘XX certainly as laid and year. the look We foundation more we this encouraged I and out are beyond. in

it a Hopefully, good to question. I that gives answers framework your think you hope about.

where you and I I also bringing tower outlet just the And previously that up update us time think ROI I hope around stand? mentioned then Yes, fund potentially think following that? Can it. for lines projects, Village. new potential help you capital you've to on And that talked about on appreciate in in might maybe just the Hawaiian

to Yes. to to at Other than the incremental capitalize to with in the something say only about It's nearly way come. resort we We're of that addition Other too in we've rooms not that through rooms generations it and certainly going amenities forward will adding another it. to to coupled world-class have that for sites options talked continue we're tower early working going the timeshare to the on. are 'XX And talk it capital a to leave require It's or than X to 'XX. X,XXX got about will we being say, It's X,XXX that strengthen that. on I'd how process. move entitlement years few out.

Thanks a lot for color. the

Yes, thank you.

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

morning, Tom. morning, good Hey, Good guys.

morning. Good

course, is There's lot been on minuses lot you -- thing also such. done? But this And on Questions operating model minuses, year of is have -- of a into right? operating look where there's mostly the a heading the to like been -- model a and pluses you we focus of this inflation. beyond on at kind reimagining of, margins the lot, about do how even of talk reimagination as and

business do and all comes a group And what XXXX year, go? any bringing this on question to be back, We or occ get to a back to to to and the to back the back, gets back? is get honest. How occ But and margin. have it's want that's we the if do this and now where -- ever get service-oriented we coming more Or we're hours more is all you the back. get guidance us bit back understand it in coming be there more and the just have for to housekeeping where things to we with point of margin restaurant impressive that your little I just

think brands I down to a call And going little time service out I and which great Chris, business and you key, us with And think, back things and amenities of differently to widely look all drop question. digital I start whether been what the about do bit to Yes, want and the creep. it's it's forced have using you every it's initially, a technology, think a room more. I add the both the better; lock whether reimagining have we've started accepted been pandemic knock guests. appreciated around by

finding balance of service and Marriott whether both now that's in reference right believe with the different whether CEO made stakeholders, housekeeping being that levels the and to guest. I the it's call, employees

think satisfaction organization operating in an as permanent sure economic an and so And changes an relentless continue be what I industry you're what to think see going intent as way but customer is to also that figuring make to return, to and figure I sense. out to to drives got we've model we've and that got out do makes a

hotels fun owners. ‘XX, of business to to ‘XX, no go our back had the of line to in growth fun None for well. want us It And to you since we for days wasn't the where self-op wasn't guys the and top and certainly margin us anemic operator, ‘XX, it few as case, as ‘XX, analyze of we growth.

And generations will to we there. levels right, the these So that you're changes where have we're here. points. pressure But in there'll game and cost There in an over. get the continue going to transient back some are just be for It once creep I abuse think from my that business the pressures. we've in view, add-ons make is to group and environment I that be doesn't can think amenity here sense seen

the Park guidance seen take partners We're to cost our done work you really the to business. out us. in part margins work of the of at by men where and you've expanding And great we're giving hard because and women

to So those ways going to find we're to to and efficiencies. find fight continue continue

helpful, I Very That’s Tom. had. Thanks. Okay. all

Thank you.

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

Good my morning, question. everyone. Thanks taking for

morning. Good

or some covered that markets so lot in the couple order ways. embedding in But in markets How to your all you to credit and Sean's I $XXX million to important it wanted You about for back detail. into of of the assets? on will how you you've what be able you credit far? is of Are improvement it refi-ing. improve continue different to sell for thoughts have go lately. expectation plays there, about a a of alternatives in that that talked just comments, some we $XXX obviously what's to seen some the million talked plays

part take first I'll question. the great a of it's David, it.

the $X with San attractive the the some and some quality shown, we've very assets, and sold think to different for less earlier, look, I very in it get since Francisco I XX pricing. aggressive pandemic, ventures, done. for tax, all as of joint over assets we've attractive with very, said assets billion we Right continue spin middle sold of we two in legal,

business. private $XXX you just on estate are there Family abundance real capital for still the equity as So open offices, is side. out banks there, regional an billion know, owner-operators, of in

big more haven't and financing. I demonstrated little the again, able think whether time a and and banks it's careful we Clearly, time seller money constrained to center -- been but are being -- we've being more are use

use -- been haven't haven't we financing. needed We seller to

done. to deals raise been get the able buyers to capital Our necessary have

So we're confident.

And obviously, there, there's cycle with are X% visibility tightening X% in better going banks We're the -- and once be to a to back the business. range. in

For The free that of us more of with X% that not is all the scars, got have money we've that those are X% to have that over. people generation older is free got is been a money. With problem respect, dealing due bad.

a little got work harder. you so to And

and It's to but over be a just to will There'll going term the that's ability deals be able intermediate call to long think candid markets will get not I to be play Park's financed. back. There be the liquidity. anymore. And to debt benefit the be phone

little bit transactions. there'll we do But of for capital certainly work. of a think to You got be plenty

you. Thank Okay.

Well, thank you.

UBS. the from comes with question of next question. Our with Farley Robin Please your line proceed

on. I'm Thank on what's interested you. going Great.

Robin. Hi,

just almost a which improvement like terms mostly business about good I'm morning. error a on think seemed like XX transient. But rounding you? looking a And XX in in are better in QX I way your points Hi, than QX, kind How XX relative of business of right, at is down points QX. QX, what's where interested maybe XX, slightly down guess error? with just in It urban rounding going good to transient. seems of from to sequential down points -- RevPAR, occupancy

we're you think seeing little happening think bit about But not wonder more didn't that where I with a transient the with much I'm guess I it's and as bit business I going is what is show maybe surprising you certainly, that, only a that. what just not because talk little Thanks. business transient. of hotel curious on company you're could if you sort think of

it certainly have I looking tremendous business through we at throughout and tried a test improvement. the to seen transient, think occupancies certainly we've and with saw mid-week year, we

caused When of especially occupancy and Our shifts look San little to urban you sense lot in you is to comps coming there. and the at there's QX about of a at it in an some looking ‘XX, back at portfolio big be it, that sequentially. QX citywide getting skewed look Francisco as definitely hard sequentially, think a but a

you see QX little bit you -- see occ QX. in that to from kind normalize a that, of for you So portfolio would ultimately, of in improvement think I

they're whatnot of coming with and a Going a into back. of slower. certainly little there. you hesitancy corporate bit focused travel accounts and We're certainly on of as QX, through lack It's travel been technology you're big the layoffs, kind seeing and little think some certainly, and the of

the Some financial little of services a strong of but the lighter. been through the bit other verticals have the end and like, year,

now. up to We though. some continue other to size -- it, transaction right and more right of expect Clearly, to light things activity of and though, pick kind are kind do

holiday had weeks QX. certainly the events in holiday around disruption some in You

beyond, again. of And get so get that as we normal to more think we'll here get I kind we pick March, up when I cadence think into see

better good business one that's monitoring, feel a we're this we're on group lease see there and about we I recovery year. pretty certainly when Certainly, to holding feel still that transient, but and going

a And Okay. just follow-up. you. Great. Thank quick

while fact the through flow flow positive? and I where last that not a right that is to necessarily for a year. at San talked for Or cash point cash you alluded positive, expect recovery that now? to already wasn't starting something be did know you in Francisco You about it's Are you

do. we Robin,

We it's and positive. going are be flow certainly that to believe encouraged cash

at levels corner it Now we and expect ‘XX we time. certainly expect not flow cash But to it peak, the be and to we do this turning back do positive.

Okay, Thanks. okay, great.

you. Thank

of Bill question with next Crow Please proceed with Raymond the line comes from question. James. Our your

thanks. Yes, Good morning.

Good morning, you? Bill. are How

on up I Thank RevPAR within Tom. trends index following your what start Sean, question curious with want Robin's to you well. And I’m you, are about those properties? I'm urban and the properties. just

kind the San say puts relative and We disadvantage. next to it's that we of -- see others mean certainly typically -- in relative its have -- boxes It's the for convention compression, one lagging. XX%. probably mid-XX say improve to a I to trends certainly in as better get is on I'd to expect now, that lagging. they're Francisco, for We but would -- fill XX% We RevPAR and certainly to bigger the that well, it's location to comp I set, in XX. center definitely

to within and center, ultimately, bit that helpful Again, to would Bill, for then markets is the been think given little asset. the kind of above it's for much key Those probably its right convention we're about the in Chicago, in relative is, better saw was than hold I seen York probably we've XX% a as in seeing past index that a of ‘XX. a little box ultimately, on box in I index. feel, Orleans, a certainly in bit think, actually there, -- it to I par we New it are of New probably what ‘XX where And Chicago, pretty big and as the review productivity, where was its ‘XX, pointing X% we be the past.

ran the But I years the other you bet and complex and look also back complex and you to between historically, XX, Bill, San location. date XXX%. part the the size more, facility it or thing the is here. going and that, to of went And look XX would XX% myself if Francisco probably I'd if add of the

that. below well So clearly,

up. that that the how figure we're think as one to obviously, of were it renovate to the model will for been this, it's The to And to are It's capital that I and in going you, we're but out But and rooms projects there complex. to that a just ‘XX, and frame one clearly to we of XX then transparent be, certainly we refinance going We're asset the pandemic well completely for going aware, back our But ramping going going allocated. is reasons it to that. we've put Park in to and we is be wait; done, matter done. just overall going are about get are begin context is package. when help we'll the

remain -- I which And optimistic, Francisco, should appreciate. I San you Tom, in or say, on bullish

I think of I has on bit got a worse ghost some and ground town. written of kind made downtown is been economic and about and of into have the progress there that. you and have has little talked that, turning But the aspect a it

a would for is a So relocation that ends, the what you market that -- is mean, make announced think? you less when if their turning point the JPMorgan contract optimistic? I

could things, Yes. you about could and afternoon A talking an I probably I obviously, few mean, it. Bill. spend

narrative them. I sort in think a got what away the happened San of is Francisco from

think embedded some when know they're when share as you. there lagging. you with think education the saw But geography, space. been base, I -- doubt to the just I all NAREIT expected. are No anybody. But that need happening conditions about you I've than people Francisco. out as at beauty, in And to in that don't you city The better advantages what's the we think the I I San about fairness, think were think think there I much technology

the in out the If other being what's there's than times AI, at in in country. any money you AI spent the market in look Francisco X happening San

lot So days sailors, getting money were uniforms a are drunken of over. and look, those the spending like

And So the close lose innovation, a forget at will then growth. point. some of important still and is you're venture reconcile right going It a part don't to it to of of that sight may be Asia, take market but very connection capital size, of see that that little going that to while. foundation

And what X spend Asian really we as side. domestic we that traveler pointed see of nearly out, times on the that

and the complex, pollyannish no one got, not be living drag. encouraged fact So really to obviously, this there that's about through are fundamental been over we've I that this. the long-term. We're think, like given the big that We've benefits, intermediate X,XXX-room else

Once given come recovery, people the could you leverage, realize. it get operating anchored that that back in faster than

You the fourth sure gave, that. crystal first as up us in probably story probably would ball was where your quarter. good is in your heard crystal the of X% anybody. have in New that and York quarter were predicted I right, not I'm we and the ball None XX% as

wouldn't safety of it is I think, many, source off. security but I So write important. It's frustration, for

women think there are You've have got have to leaders men stepping And up. have leadership, you to but also political business leaders. I the and also

incentives, other talk you the as more reimagine far So about to tax you're engaged, city. seeing incentives them

So do it's be and ‘XX. going to take happen to ‘XX, think going about not can in foundation time. but I to things the It's laid in be ‘XX, some encouraged

of the $XXX real the issue intrinsic fundamental $XXX,XXX or debt. do $XXX for key value key. a a of estate a of us And than key sold pandemic. The is believe in for the higher the we We the that is of inside middle north is at that debt Law Meridian a

with a believe adding more hotel in there's Francisco value embedded we San be lot going to product So with particularly XX,XXX and you're rooms. market not here, the

onslaught going with see Francisco. market, San select peppered in You're all the York that service to and going not see to the not the that what undermine happened you're New in hotels of

gotten over So to fundamental we've study year. certainly else painful, believe we'll as how long worst And and the through the and of there's everything but that pandemic like said, it, there. Today, it done we intermediate get through to hanging that through we going recast worth going we're refinance in there last the it but done term. some carefully the benefits we're

how and time experienced demonstrated we've we time it's very team a think handle and to know it. that I

appreciate time always. as you, the Thank I Tom. Well.

you. Thank

comes And from our with question question. SMBC. Jay proceed your Please line next of Kornreich with the

Hey, Jay.

Hi, morning. guys. good morning, Good thanks. Hi,

the me side. Just one what the at XXXX. looks of group group were XX% for one they It plus year on end were like bookings the T in of

the and showing all coming is So Francisco. you I'm of of up if clearly similar a group San same that's But that saw stronger type different group's picking portion type down you sizes can good at you're and sure what before customer if seeing markets a than of up and or from the break currently return there's pandemic.

those it's as activity looks gotten for to January different. drastically smaller XXX,XXX got groups had certainly, as and plenty peak it but I room And with behemoths, we've haven't seen have the growing. say booking on I out is we're here mean, really on past in ‘XX December starting where lengthening ultimately, and we well. peak in booking that's window of we wouldn't than one the

to of the smaller in clearly, of it's some remains starting pipeline, larger through look being short-term something ultimately or quarter bigger. different. but difference, back say it the a see the might big groups, wouldn't ahead, lot while clearly, that of So for you're breakdown say that's a groups done much the in quarter, have through, I'd coming the a I groups of But the those coming demographics planning and year last group is that group

we the but starting kind get sizing of them go to bigger is expect smaller, they're of we really Just as along. it

guys. Okay. Appreciate it. all Thanks color, the for

end call we the And over reached Tom Baltimore session. back And question-and-answer for the of closing I'll turn have the remarks. to

weeks look taking Citi in today. and the time everybody appreciate of seeing Conference. you forward coming to the perhaps many at We you Really

day. great have So a

this your for at you lines this And your you time. may today's concludes and disconnect participation. conference, Thank