Park Hotels & Resorts (PK) 3 Aug 232023 Q2 Earnings call transcript

Greetings and welcome to the Park Hotels & Resorts Second Quarter 2023 Earnings Conference Call. [Operator Instructions] Please note this conference is being recorded.

I will now turn the conference over to your host Ian Weissman, Senior Vice President, Corporate Strategy. Thank you.

You may begin.

welcome, XXXX the earnings and Resorts Hotels operator, quarter second call. you, everyone Park to & Thank

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

differ performance, update SEC, statements. materially and As subject and from statements and to obligated we outcomes, that forward-looking the cause most are to Park with differ SEC, those Actual important to actual expressed publicly statements. from XX-K uncertainties Please statements. to that are future and the which XX-Q, not in these results differ with described or risks from those the refer may filings forward-looking forward-looking factors contained in recent specifically could Form our cause risk future revise the by in documents these on identify reports numerous those filed results could to the expressed results

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

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

a our San were two be will portfolio hotel Additionally, In the all on early that current XX be basis from otherwise some will excluding presented consolidated with hotels announced view Hilton instances, all unless comparable as June. operating in basis we stated, results removed results discussing hotels. a comparable on and include Francisco however, previously anticipate we

as second initiatives. Officer, on as sheet provide Dell'Orto, an on provide highlight and balance Officer, strategic our Chief a liquidity. guidance results Chairman color update well our Baltimore, quarter This Sean morning, Tom Executive Chief additional quarter forward-looking our will review and Park's our and performance second Financial will of and

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

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

and welcome, Thank everyone. you, Ian,

important quarter solid growth. balance continue and for ongoing strengthened our another benefit from report across to pleased initiatives long-term improvements better to company on we our Park am for I strategic as which executing the while position sheet, portfolio

the solid during we a quarter. RevPAR recovery comparable year, point generated exceptional XXX by increase last Hawaii, the encouraged fueled nearly in and continuation our the accelerating occupancy two by ongoing were our basis our In the operations On gains group in results very front, portfolio fundamentals. versus urban portfolio across resorts of particular, from

uncertain Accordingly, balance that to is the with an city is elongated return levels we peak improves our our making previously we In an the best recovery this service city payments we the faces shareholders the believe Francisco and XXXX San disclosed sheet of two hotels. to on nonrecourse Square the reduce it optionality exposure will of Additionally, decision and and the San view, our Francisco loan Hilton but CMBS debt June, as $XXX made Union to San Francisco. Francisco in San Park difficult as considerably. significantly interest XX decision greatly in strengthen by million strongly cease our eventual for have the necessary secured our

net by Following just full comparable of a turn freeing X% almost as to and we do the emphasize Francisco possible. as for reduced I servicer removal two continue the decision earmarked of both capital future portfolio, our by to adjusted hotel help the these be that a assets with EBITDA while at negotiating of on San will account not intended up to renovations XXXX loan and want basis, tactic, million this these work divest from hotels. is $XXX nearly to quickly our and assets be for further ratio a will leverage

May, and strong increased start our June. in for was moderated comps QX year-over-year year-over-year a as portfolio the tougher X.X% by RevPAR April to in quarter

strength XX% XX% hotels, with both urban of well which led year-over-year generated gain. of our as RevPAR by year-over-year over RevPAR growth comparable expectations from which as nearly exceeded Our was our results solid Hawaii hotels,

results drag resort West, partially Bay by resort our certain for trends were XXX our in Area the basis RevPAR demand suspended Casa renovation disruption across comparable growth the the markets, including for quarter. softer-than-expected and at full-scale offset These accounted operations from in Key which Marina May, point on

segmentation. to Turning

are XX% benefited very urban both. QX approximately improvements year-over-year are We of the short-term be to nights ongoing million room for we revenue. growth, revenues and million demand and $XXX of approximately expect incremental drivers or group strong to for comparable we $X from as portfolio witnessing encouraged group adding increased XX,XXX our for key by we XXXX the pickup,

a comparable group to XXXX basis relative in to nearly exceed pace increasing comparable during the XXX full X%. XXXX year ADR projected while XXXX group As approximately XX% revenue improved same quarter, the by result, XXXX, to is points period

XXXX are next group with of encouraged nights, XX% XXXX larger convention XXX,XXX Healthy increase our room while Orleans, The citywide convention comparable by over expected in to especially Chicago nights New at in revenue increase or room and XXXX peak. shy momentum XXXX are of quarter. nights end over year versus we to to nearly room XXXX, nearly nights exceeding second some to to the to trends bookings, driven are out XXX,XXX of nearly being group the convention projected look the room strong the in we markets. XX% just XXX,XXX pace the demand XXXX As peak of nights, by XX% room

meeting the up comprehensive meeting our to pacing ahead through incredibly XXX,XXX positive. XXXX, first has feedback $XXX watermarks period been Creek next nights. XX% for group At up of is witnessed from year by plus high well positioned XXXX six complex and room XXXX. renovation to Group next Signia the early books XX% our for months year, pickup business on year Bonnet to complex planners the XXXX of solid and to XX% expect room also Waldorf with The for same has where by this XXXX's we the ahead of XX% is and up in nights relative space expansion complete million

forecasted rate a total and levels million drive with Strong in catering $XX the performance projected year to of XXXX. XX% of by revenues nearly approximately banquet full in increase XXXX for XX% revenue are excess coupled expected gains

Turning to our urban markets.

Overall, hotel XXXX. gains X% posted while hotel X% of with percentage York or XX generating an points segments City quarter year XXXX within with at and last above of of demand contributing New XX% X% to city results. markets XX% the demand RevPAR rate returned during increased below as the occupancy one the growth strongest the to has our impressive the portfolio XXXX over all over just year-over-year

city respectively, In from the Chicago, the up occupancy XX%, a during by both growth XX% while convention calendar reached XX%, year-over-year Boston solid strong RevPAR growth during for quarter the and and as in and RevPAR quarter the rate versus gains quarter, was Denver, XXXX. benefited driven

weigh for last Conversely, portfolio continued on of were a period results, same San three remaining The a Park quarter growth portion Francisco the XXX excluding which second to to the hotels QX year. was the comparison basis drag XXXX. on RevPAR closed XX hotel, point

impressive assets, year-over-year demonstrated portfolio which again Our results. unique Hawaii, for our particularly the delivered resort strength once continued

the the and Our June bolstered nearly Hilton by gains results in occupancy same XX% X%. last on X Hawaiian in of by percentage record. QX history, a excess performance driven Village delivered period best strongest RevPAR increase quarter point during increased RevPAR year, the ADR versus the in

averaged For time during below peak. XX% the with ADR still the XXXX the during the start the the while demand of pacing XX% first levels. above exceeded occupancy occupancy QX was since XX% an XXXX pandemic, result quarter, impressive XXXX quarter up Japanese

At XX.X%, above occupancy driven our of daily since at a Hilton the of XXXX. XXXX. X% highest And in QX rate quarter Village the level an Hilton the last XXX over hotel to during by point out average Hotel, second basis quarter occupancy increase Waikoloa the spinning XX% RevPAR from increased in year,

XX%. XXXX, of convert hotel Hilton performance have most in making XX,XXX over portfolio. has Waikoloa expanded XXX EBITDA by has to XXX to improved year-end assets through hotel size and RevPAR nearly our transferred The the to that one reduce our XX% to our since points over increased total when been from Vacations keys by XXXX, Grand and period, impressive the Hilton Over the Margins per timeshare. hotel has profitable key the of basis we of XX,XXX, Village

hotels. while Market both share to at XX% With Village continues XX% quarter. Hawaiian running RevPAR second the Waikoloa RevPAR success set, at a Hilton exceeded comp for story the be to the premium premium

continue flights year, Healthy the demand RevPAR domestic flights direct Honolulu Looking by balance to with likely Hawaii increase drive over is mid-single-digit per of of just balance December the to we the July. are encouraged increasing year-over-year flights of the low of out year, performance half by to expected scheduled in the although back in to growth in the to from forecasted over the XXX year. from week over Japan XXX the number

third Turning to Hilton our the break And San million, acceleration quarter. midpoint continued the to select expected Despite pockets group extent, was a are adjusted range some and hotel largely year strength included transient guidance. across of by driven Hawaii small combined now $XXX moderating to are of in X% our of lesser softness ongoing versus prior in EBITDA to full expected a at which $XX in expectations we adjusted million during trends, to guidance. even EBITDA million by Francisco in XXXX that the underperformance markets two hotels, an by XXXX the the new of $XXX

an consumer we improvements of trends Despite recovery optimistic travel over track lodging that business support backdrop and and macro a year. to small part change, latter continue the remains will that ongoing solid this the remain in on improved

for we the create we position shareholders success. believe committed strategic long-term value to which our executing Additionally, will and goals, company for remain

allocation during $XXX we $XXX including asset noncore year, maintaining our which quarter. the first this million $XXX front, sale million Airport Miami the the capital sales of to are goal closed of of On million

through be million to redevelopment asset our $XXX year. reinvest buybacks and to portfolio from to is used back noncore to excess Proceeds of are reduce in robust our and expected this stock in which further CapEx sales fund pipeline, leverage-neutral leverage

we all progress. to will continue the our with market strategic update As initiatives, on

group In demand that addition benefit from to strength to that Hawaii. have reemphasize portfolio we summary, in want I and a continue will improved urban well-positioned in ongoing to

are we will allocation which internal value for team growth Our and the shareholder laser-focused our remains capital long-term executing position create success. confident and strategies priorities, company on

With will over call Sean. that, turn to I the

Thanks, Tom.

for were adjusted portfolio while in occupancy EBITDA year-over-year second during approximately was was $XXX quarter, was mid-May the representing or EBITDA QX $X.XX. hotel Margins above in adjusted point levels. for our Casa were and a the performance. quarter basis RevPAR X% Resort, impacted renovation, at $XXX share pleased portfolio at XXXX $XXX, adjusted million natively XX% accounting disruption with full-scale XX on Overall, for suspended FFO per nearly resulting was and which our drag hotel $XXX renovation performance. million, ADR growth X.X%, XX.X% million, a margin. of was nearly we QX with by EBITDA $XXX Marina Hotel revenue adjusted operations at

Turning to the sheet. balance

debt of coverage to removal Hilton is and QX the was a eventual improving sheet to from liquidity $X.X materially nearly turn basis a interest San in Xx. decreasing balance leverage billion, cash. When hotels metrics billion two over $X.X the trailing net a leverage $XXX million net over including and X.X full improve current our Francisco for XX-month turn end was by the by Our of with Net X.Xx. portfolio, on at accounting X.Xx

mortgage fully we which allowance our City another June, in the to August, repaid reminder, million mature secured adding by in set a Chicago Center, unencumbered the to $XX property portfolio. as was W Also,

to Turning guidance.

of doubts, $XXX, midpoint guidance to please of by the to both impacting in approximately negatively margin which Francisco To points adjustments has continues results earlier, hotel-adjusted weaker-than-expected and noted midpoint margins year. of XX RevPAR growth reflect basis points of representing year-over-year softer we above include in impressive with for are while both XX.X%, near Tom Hilton Francisco lowered EBITDA demand, margin and both the note XX to transient slightly San year the adjusted EBITDA dispel term. the a San that to been results hotel XX% X% range full RevPAR XX% range prior basis top decreased Accordingly, has and Hotels. been a line between are operating and any to As at of the making to the $XXX

from range and default FFO per interest just $X.XX $X.XX San at by to guidance adjusted late fees of midpoint the nonrecourse respect falls Francisco share as excluded a With payment new on per the loan be to AFFO. the share, CMBS associated $X.XX to will with default

Finally, item one note. to additional

under asset lease November the contributions expiration expected by the is over Hotel in to XXXX. ground this noncore XXX-room June Suites prior however, impacted Guidance, of balance terminated As as the portfolio the to make to was year. XX, the Embassy minimal not materially Phoenix its Airport the was owner of

As materially improving we have spinning of since our Hilton in while or $X.X quality a disposed successfully billion, reminder, of XX hotels portfolio. of out the XXXX, sold for overall

concludes remarks. This our prepared

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

Thank you. Instructions] Our question. with Dijkum your [Operator Floris comes state today first Point. from question Please Van Compass

for guys. taking question my Thanks

Floris. How are morning, Good you?

Good morning, Tom.

San we matter interested if guys, return it's might little the like in this your Francisco? that different? there. your I'm I year. but I'm also other leave losing year you've there impact the - you know And - guys bit really guess it increase is I Francisco, results, debt? $X.XX in on And still. in it of be your next a San at shouldn't two Maybe because can system hearing little touch penciling guidance So in a where of you with also, maybe give earnings weighing associated debt going should these CMBS this EBITDA if sure situation what's can a in why based hotels significantly you things on be more about to hotels on happening you have lowered deteriorated all have actually weighing the been is upon on clearly sounds

Yes. a as decision. necessary prepared unpack difficult important we there, - look, to Floris. guess I we we remarks, the said thing the in lot There's the is, made but

back report coming we more the we'll optimistic as And We the cautiously discussions months. continue in give to as certainly keys work to We're quickly - are that with can. to the we're servicer here constructive. have

as done quickly possible. this Our as hope get would know, process. be as don't the to we But you control

probably want than shouldn't careful be I that. and to we So say more

many We decision you thought about C-Corp the respectfully key tell time in five this I would terms the think the ground in one think the the San know REIT early you know San being and I that spend years. listeners of submit and as CEOs, CEOs Francisco were the And would long as days anybody even hard I this, I much in I Francisco. that of and ago, as seven there recovery thought to and extended. as be can takeaways We to period years. probably three on XX it's

The to weaken. rise. high. of an calendars, north Office to vacancy It's continues XX% now, continues all-time again, convention

and You're XXX,XXX nights XX% and pre-pandemic to below room the now down XXX,XXX dropping. perhaps level, that's probably

and the If in 'XX, second year. you of of nights in half that most XXX,XXX about about city-wides room is backloaded there's this think

about is Next year, outlook the current XXX,XXX.

their build until organization That year. identified, team. - of able is Francisco not leadership latter San probably been marketing critical happen that the going leader not travel, the And - that out been doesn't part or has to transition a has this doesn't she new and through change. leader he that probably

The that City I the helpful. of know, sort is all change it's hard leadership working very to real, others fact And not time. are narrative despite it's loop we to that and the it, think going take doom

compare X% XX% is the flat real to to, say, if end San subject down, two to on at if levels. below points. that So it's where year RevPAR probably see relatively this in you XXX - to for pace outlier. just you And look drag the RevPAR group is would properties, to York, we the New a been XX% a basis perhaps and of I Francisco - overall XXXX you XXX can that consistent expect year portfolio their

properties, There there are to are Union the range. in to too Marriott that two Our Square, Fisherman's in in one, the Wharf, smaller other faring assets better. are obviously still one levels, XX% probably XXXX JW they XX% down but

have address that overall completely in about realize for to until we it Francisco, removed So portfolio narrative we the to the helpful It's we but it. market still is Park to still have the from to continue not guidance, San and challenged. is talk

that midpoint, had reduction reason rather that So and if you of we're modest here a guidance and lion's take the to it explosive the San is other the X% was traveler share the about Japanese urban, which and of we talk we and the We'd Francisco. that the fact out, still the portfolio, in growth our Hawaii have accelerate. given seeing, to continue don't parts both group and

will Francisco play like The encouraged. many San very others I overall, story believe out. So

aware there all not end the that difficult San anytime It's and they're we necessary that made Hence, to going but the impediments Francisco but challenges real reason will structural take recover. soon. we're of, And going longer. just there to are decision.

you touch the too Or your that early And to year? view? in earnings Sean, want impact on that next maybe is potentially of

to. think it I can kind the properties clearly, were speaks what at that of of timing this and I it Well, earning would to rate we $XX obviously, a that mean, remove mean you're year at We're you was, assume are essentially, to basically you of spoke if Tom looking million that to year. doing interest that carrying the ultimately - stated just ultimately nothing certainly

decent pretty So per certainly share. earnings in expecting yes, we're uptick FFO a

Thanks.

from Please Citi. state Rose Our with Smedes your question. question next comes

you. Thank Hi.

Francisco, quickly on actual to reflect Does the than business coming? initially Francisco. transient lower maybe up is is of anticipated? not follow of the was you San Just less that are now back half books To through seeing fallout Or it on you year? outlook the up group had San kind follow on that just the

the some conference, of which in important is they a clearly or think doesn't XX the some world leaders terribly I groups. both, of up - world it's you're is Smedes. to expect combination you're APEC XX There because leaders. again, Obviously, help. washout narrative seeing I the mean

So that others to from and ensure appropriate that I measures municipalities even support and perhaps the the believe safety the city government local are have with place. other will federal in

hopefully expect So that be I will well and would received be that, outperform. productive and

to I give Sean recovery, decision were more numbers his Again, you you $XX and in be remarks it's see But that the as a flat million real, slightly we could would the are the reality we expecting that made. of going contribution, negative. gave in the elongated and I reason hence, we noted being that only just to today, an

- washed about prefer look, other the talk performance of things we've particularly, We've other we've in to we've again, So are extraordinary all the And exciting removed Hawaii Francisco. derisked parts essentially San far seeing that. that that portfolio. and of the we're happening,

Okay. wanted to Yes. just Hawaii. And up follow I on

something RevPAR just noted, expense quarter properties healthy you kind of what and the there maybe wondering going you're expense onetime kind at comment side was but properties. that was commentary could you're the thinking those up of seeing forward on maybe And you As across margins, on was weighed I how was but just maybe in down that. about pretty EBITDA on growth some both if or the around

this Yes, is Smedes, Sean.

had For we accruals of QX, union of extensions half through last with from to ultimately kind 'XX Village, doing the first early some carried for related baked contract. we're Hawaiian specifically the over and year

reduced QX helped property. for kind and So were certainly released reduced ultimately out of expenses that those in ultimately

it's onetime So thing. a

Okay. Thank you.

XX% despite premium, reported, is is running please Hilton Village, premium. where mind at we a certainly, as Hawaiian keep Smedes, Waikoloa RevPAR XX% in that, RevPAR Hilton running again, in Hawaii

our many slowdown I sector seeing think a where in in So despite leisure. the fact

been don't We again in had Japanese we traveler, XX% which continue of business. still the Hawaii, outperformance to strong and our see historically have

to the XXXX. that the XX% about we XX% probably down to about XX% be by and it's of hope of XX%, expect reduced end it'll down And to that's down end by 'XX

year remain EBITDA we bullish record we last that And very, strong of year we this Hawaii. towards well. So, had in look, year another and trending very as certainly year expect very a we're

Thanks. Great.

Our Please next your with BMO question Capital question. comes from Ari state Klein Markets.

Thanks, and good morning.

morning. Good

that uplift just you that that slight or still earlier you meant point, Japan see half the - following up the that into from Maybe improvement thanks. to booking of you starting following the to - too you back last Hawaii. trends early the see confidence Maybe Tom of in better on you'll gives translate that year just it is there? Are kind mentioned

look, as green a the It's little XXX. seeing we're out still We're encouraged. shoots. given some flights very XXX early. pointed a alone just week we from going But to And

government well. Hawaiin meetings also with officials as probably the Japanese and tourism that You saw had officials

connected they optimistic. So, have have accelerated discussions and been very they - so There connected. remain have we

if And million. visitation last the averaged XX Japan from over historically has X.X about you years, look

So, about of most they longer and loyal that's our been among that's and XXX high-end more. for a three average customer. we years spend half three, down And sort weddings. They historically, been - stay

to I year were we down five. think last four or

So, we're encouraged very out. look as we

the just that mean And iconic and for of of have Hawaiian given years. nature Hilton dynamics it one been families Village, the given I generations XX is certainly visiting

only continue to So, we fully to expect recover, not that grow and going it's to continue outperform. really but really

forward And seeing demand seems we're the mix, and And well, as side, transient positive you as there? are have Thanks. business year? now than your what somewhat even performed through What recovery it been pretty normalizes. on moving expectations halfway kind business urban you the as underwhelmed the are of on is while have the group markets the on then weaker leisure

I Ari, June, part in and in of kind ultimately, we certainly I expect we see this and still ended the digits saw out quarter, bit of of certainly, strong April business then through think the see - went could we transient, and think more we we it's but pretty Sean. kind of that May is We back kind continue lined of a as but year. up little mid-single year-over-year kind in through quarter, the the as of to the

the into rack say that's mean look more the rate of rack year-over-year, that leisure that one seeing rate. of where of it's a transient, from kind the we element can at pressure I as So, would kind the And plays business part I you're of the obviously and leading compression be elsewhere.

look transient. the So, pure would at really you of business kind

to and local well. the XX% see levels positive to kind performed year. I and the half was QX to certainly continue still, negotiating, grinding that ultimately of grind the government up well back in be expectations even in and of forward year-over-year It's have corporate XX% below think its it we of 'XX of

I color. appreciate the

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

morning, good everyone. Hi,

morning. Good

morning. Good

question Following, any be mean I is that softness out that in that segments, transient, expand quarter. - would on or up the you called on on third transient the specific markets there guidance helpful? in maybe Was comment

I which coming group think think better Sure. than not and been what reliance QX market I it's you'll you've together. had some needing QX, in to mean see continued activity you Francisco, transient, in while just just - clearly San got I of that

think there. So, the Orleans seeing New say citywides and group then and some year good year, Chicago, markets first half of but the of had terms weakness less of New the citywide and half some I Orleans. I'd there, back are far the in particular activity in Chicago we're

in in we've of So some both that, kind are up when in to markets XX%. Chicago pace known year-over-year. QX, for down have good we QX, got group in-house neutral But

We of board bit some we're we're where little across forecast, just derisking on in as softness that see the that's think markets. I transient. So, And originally. that, seen - in the aligned those again the well kind a looked

is, out really tough that both that we Anthony I as in had is earlier, comps, noted point other June and Sean would The July. thing,

those, previous for both X% versus year below XXXX were of last about month. you the if think months levels So, XX% about

than obviously, that we they RevPAR, ended see X.X%. up July coming always XX%, June X% we June up little April, expected expected. and about And were May down up of in we we So, softer a

or up the July the be lot really in at quarter. of of quarter around a expecting fourth up lose somewhere little while but and to noted in in X% picked is, bit a X% probably third plus that Sean quarter looking the probably X%, the we the we group as fourth a strong quarter to We're minus, that

encouraged you still kind and So, to we're New X% expectations in very in in - markets think York, XX% when addition them so, to up strong about like RevPAR. of transient

is year. we're growth a is not the mean, out RevPAR look not This of the for - this is I not this we - as negative balance downer.

the choppy. near-term hard issues have there, it's encouraged still still we a recession, market see when So, uncertainty you to growth of as are of but topline that is There look out some type out.

demand. Maybe going back Got and leisure domestic Thanks. Hawaii to there, it. demand

strong very but back in on generating we've I result great, on and market. very growth Hawaii the that's guess that's the of customer domestic based competitive seen a You're -

yield the how that these keep the you have back, generate coming customers just that's when make back? do traveling So, traveler to growth U.S. with than Japanese can customers coming are Japanese Hawaii, sure you So, who replacing actually at property incremental customers? rather

And Hilton done you've team credit Anthony, that generations and like iconic leader great of the Yes, Sean they've management the question. when think run I just got to right extraordinary then Waikoloa. an it's a and assets and Village and asset our that, finding to both And Hilton and Hawaiian just the extraordinary Debi Bishop two mix, travelers job. her that team

premiums RevPAR the think really I of and -- that. show So evidence

are continued to lot outperform, up of our Oahu. when and a other looking you're of Hilton XX%. XX% up much Hawaiian peers They've performance think I candidly markets showing Hawaii in Waikoloa at Hawaii and including When Village, softer

we So, don't good. take and feel daily very a field playing every granted. for day battle But anything it's competitive as and we

you. Thank

Woronka with state from Bank. Chris your Our next Deutsche comes Please question question.

Tom. morning, Hi, good morning, guys. good Hi,

been of Francisco your the kind going to market and that's that's, boxes what think you the speak a of part I San that for as group away effectively yes, big so So, guys ecosystem for and portfolio.

are San You these markets Francisco don't groups have really any going. in group some where of exposure

you potentially does look in Vegas make Denver, and Las it's and Phoenix markets? that gaining Diego those So, exposure harder bigger Scottsdale and group San at any

the terms is another of me I of another let asset? make sure In question, play, understand Chris,

replace have kind - - little better have it's on away say composition to lot it's a in U.S. longer but but changes for you these asset-specific, particularly it's side. the does Francisco, I term, Yes, markets, don't you this because your business of maybe just portfolio the short-term, this a Western is ways group some of - and hesitate the exposure, walk some from where of San bit,

So things that any does more - become to take a might available? peek it make likely at

obviously positioning assets, to at prepared want our we look as mean speculate balance optionality future. you our say said I in Yes, at look these we've got much after unloaded never better two - I about the the remarks. sheet, we've would

the have would not policy more line ago. We many not San or made Francisco It's decisions time way, and other pandemic, have to going shape but liquidity. the the many been of and lot result in issues years take form. only just I other red and are that any complex

so that very with to two recovery is be we'll remaining the there. that assets comfortable And elongated. have going I'm

know, you days look, early It in we will the the of we a pricing. And has opportunities is only follow follow two sold and will so pandemic very returns. the market attractive the that - growth, other job come As assets XX,XXX at we'll rooms, where it the generate can back. we've

any So, we'll be Francisco I rule at think we wouldn't don't disadvantage. San out certainly and

and that detail evaluate Right in very why think we is they decision. I Francisco out right well. as the still we've in provided a the be in we'll to made I we'll very we that was made was to are or and set recall you And Diego San decision investor - whether West, deck with assets make very difficult continue and sense. great Because circumstances we'll to confident, think it of communicated - now, NAREIT, XX where San as very, to I think able look it's pages other back markets

for CapEx of any see percentage then of XX, not about portfolio to but you you several is, And over CapEx. multiyear term top Tomorrow. what into to really the ask just of might next kind or to we assets need guidance, put is I'm you the maybe second for question Thanks it's needs kind where capital do the like think if And Understood. longer your years? think - on you XX Yes. Yes. going question

for off the course of when we, Creek, as Bonnet again Waldorf we next and when completed, north as can't golf $XXX it's to guest we for renovation complete host redo, analysts look a also mentioned lobby open the all the of Creek, both wait year, obviously space, Yeah, rooms, the Signia, today. we question which meeting at some a investors' and show of the great event But the its and and million. Bonnet well expanded reopen

I'm trading very key. there. we're XXX seeing what by knows And we're encouraged at who

this And and the very pretty we so excited Casa Marina, West. then a in Key amenities We is you a get about rooms world-class fall completed XXX-acre with a of closed upside about end property We've and year, is the and Reach, which had reopening X,XXX at and very, there. this this the renovated and sister product excited already partial got the expect that. a resort

think yield that Miami, in capital Tapa obviously to year. certainly there. tremendous Tower the renovation also Resort continue The and that We put Royal Obviously, that's Hawaii to will be additional Palm plan to the we study completed this and going that for have next on returns and as be in us. look will we list well

there So, got opportunities. in portfolio where assets embedded other really growth we've the are

we're the to out keys to another Hilton Village, that or the through that and tower XXX Barbara sixth add in have XXX California we're there. the going there. - Waikoloa additional adding Village we The Hilton We've another at process. Santa we entitlement to adding looking look got add keys is have Resort Hawaiian opportunity

Chris, all So, on the those, would list. of be

bit Obviously, $XXX portfolio the that in significant have we of the a it's nonsense. two Sometimes of were as assets shedding of we million communicated. hear Francisco, will maintenance comments We're it's respectfully in really The Park be this one maintenance and deferred would I investing year asset submit, in somewhere Park the was year. in that but obviously we've range San already big that deferred XX that's did next -

Okay. Very helpful. Tom. Thanks,

Thank you.

state Your next from Please question. your question comes .

Hi, thank you.

Hi Duane.

relative the to initial XQ original How Hi, your Can the the are specifically? monthly course trends out commentary your of for you? expectation June, obviously June Francisco. lot San and just of we around back play XQ, how a played in of over expectations month

San but out ex-San differently versus the that quarter? at Francisco all we of Francisco, outset else of think month was your the initial I what in understand weaker, thinking June played the

quarter in general. seems a certainly on in it's mean June it impact had big I Yes, the

versus the we of As in you of say in for versus or the think in month into through - rest where came a XXX the in portfolio, expectations going points basis it's I neighborhood kind drop came of would it kind the June we the out call of so when month.

even the So, the better of first month that through part saw, the and July probably to probably week-to-week into parts well. good think, I seen the you certainly saw start of certainly that as for people data

better things turn have part the in seen of We back the for July.

into quarter. versus But June points of in as encouraging impact yes, rest say would say general would call we go I it XXX I of expectations. XXX kind that's basis the to in the So, third

definitely was little tone I surprise believes a a things again got turning bit around, some of think way macro from disappointing, a think but a weeks it kind we and standpoint, ahead. certainly are see we've of a in better I and us So, to encouraging think more

that that Thanks, you'd points? call detail. XXX to XXX Sean markets underlying specific for out Any basis

I think you've again, last where out, of year going seen compression people elsewhere. where, the play see you certainly

the as resort South lapped probably Santa like bigger year. continue and the you pressure are rate California on certainly they Barbara, the are see - the and Southern have would last say like the So, side markets I Miami, contributors. to I'd say those bigger, where Florida areas

New you next is on year? New underpinnings that do about just strong do as of And you recovery? Thanks. what think of the for a think Why sustainability York And view then York. such follow-up into as strength having we my kind

the in year. be will 'XX, observations. and reality levels 'XX, to be this to I we've New three in to would groups best large respectfully got able that in of meeting that we really are a large make York hotels - this Look, couple there the only submit space have accommodate footprint I'd recover thought many effectively Hotel is not Hilton the 'XX, back is back Midtown it would that city think we'll there. back The 'XX and and until be and people

expect I within XX% XX%. you I is XX%, Even look the up think minus. you sort be as to XX% sort think group of at as QX the I of And XXXX plus transient forecast, X% forecast is up of think as group - or we look XX% minus. look then And or and of in to up up we XX% RevPAR. plus at were July out we second RevPAR, quarter

of a As third respectable very out year, fourth for we look very balance the and quarter quarter. strong the

So up XX%, obviously nights about good It's has then in about think it's played I and group International part the again important room York. there. New XX% pace - feel 'XX an about in very I it. XXX,XXX

and So I and mean, hotel all the team and being a men meeting space talented contributes size footprint of there. that with that again located, of women having

have meeting big able a options And really take of groups confidently be believe again lot footprint two at accommodate groups, having again, you time. we groups not those we've the to and and the other to for a large competition got multiple best

for the Thanks thoughts.

All right. questions. you for the Thank

next Please Crow Our question question. state with Bill comes from Raymond your James.

good and Tom morning, Sean. Hi,

Bill. morning, Good

I question think Good going I'm that about morning. Anthony's to on. I was wanted - follow-up to Hawaii it back go to

fair longer-haul been international that and parallels like there's next international and pent-up recovery in travel. In might demand year Hawaii. has that it's but draw domestic domestic other demand some later to some the leisure Hawaii, there travel words, we mainland there's to apparently to Ask long-haul if expectations just and travel in normalization travel travel U.S. outbound also between see

there Hawaii, normalization you comps that your my going Hawaii think tough in is question about be in the bookings materialize to extent that that year? we're - is, anything to it Japan guess give I next will, you forward So talking if out doesn't in there confidence here and sitting not

Bill. it's Yes, a I mean fair question,

of those added more rates, really Hawaii. for and has once trip. other a first mean Southwest think airlift, also have think domestic years. I I carriers a you, look catalyst. which lot I be into the would real think attractive And it's a candidly lifetime - positive people, been, you've point been data airlift the at couple And last I in many a -

for repeat people I that become others, a it's accustomed have quite trip think to. many

picked Village a you've example just And also is the Hawaiian also up. of accelerated great got I and think And Hilton is inter-island traffic that that.

see, right. So, of this the that there's very that summer, U.S. and mean we're Japanese a I away seeing we and Yen it lot have traveler it's the to it. with strengthen traveling obviously seeing to nothing to continues We're believe been as being encouraging. again you Europe

Hawaii. Europe years that two, the same and You get pent-up demand, way three same want wanting go those in we get feel about people recapture to you to the and been to experiences signals to people hadn't the

feel domestic So, front. the strong on

important and ultra-luxury. Hilton in thing keep airlift upper part is an the not Hawaiian think the mid-market mind prices. is at other and reasonable I that capacity - to about Village the an of hotel, the it's And it's

and We XX% the operators Key West, the cruise clearly were of here. Caribbean and has some didn't suspended So, wasn't saw the a it's that. option perhaps XX%, not value it see that XX%, did an case increase and get when at we experience great in a sailing. consistently, that in And RevPAR. that some peers great That's of I our think not shown huge spikes

steady been and retool operation. able to a the also then on it's path So, we've

I a XX% with Sean nearly of outlook times and we're running last still pointed forefront that nothing great out, year, that we the look and good and very out see happen, we know today. couple us. you as as we've And on Things around we're feel a margins both team the can but one about business there been but time, there a in concerns a long were now certainly management

to window the what's Mainland Hawaii? Hotel? does that in typical compare a Tom, booking How

lot minute people Mainland could actually trips - last a A out customer, booking there. a be those short a certainly from pretty From can of make it Mainland window.

elongated you looking thinking you're if and wouldn't Mainland out, going say Hawaii days a XX I that more Hotel by of is window and dramatically a Mainland. imagine XX, So, booking you're the kind But be would the from about bit. certainly general at to in little

international six more exercise, it months. to call would Clearly be longer-dated four

see to known So, clearly times. you're certain whether elements, going peak

maybe Mainland general, a around it's plan, You're see think you from going about in to in holidays But you might few I window length a that time customer. booking December talk more of weeks that the it's see than pattern, whether as the whatnot. as Mainland, longer what be the people

I'll and travel looking about group Hawaii XX%. as things just coming and note other about up year. too Group activity pace to next add tourist to one Tom's incentive thing you think to is back

about reward travel and another we layer sales as people picking go to not to of that Japanese, well. to travel but the Hawaii the talked is So is teams demand, were - of winning the he ability there some up - incentive kind again winning

of the what's group Sean, great. percentage that's Hawaii? the No, makes in up

It's about big. XX%. It's not

That's Thank from it me. you. Okay, right. all

Thank you.

you. Thank

Your state Dori Fargo. Please next from Wells comes question. your with question Kesten

morning. Thanks, good

You've about... talked

Morning, Dori. Good

Tom. Hi,

reducing eventually of on is interest from about list How your on there taking Hilton high it priorities? your And is Hawaii. any room? in talked to exposure You've more Grand

Let me I question talked start to with I - haven't the Vacations. Hilton mean first. the Grand last

relationship think wonderful think today working out, turned to be Hilton It we've got I I at Waikoloa. a a win-win.

we get we mean As were their outlets. more benefit as we've we profitable hotel are guests noted, than X,XXX-room a XXX-room I and using of as hotel our plus today the

So it's been win-win a for both.

adding that think Waikoloa generates just or asset guest REIT to Hilton we not optimal as to it, We focus And the Village much a for valuable. mix there look more that's as is Hawaiian perhaps future. that we - is we it and it's expand and over amenities any there suites EBITDA jewel. Hilton I'm more sure that is as rooms would look as on expand other property. the really

the So we're company we'd less grow that not to but to venture. we're - contributor, sell - to such like a certainly is Hawaii looking joint of or

it makes those low complicated tax pretty very Also of assets both distribution. big will so require a a basis, and have very it

properties look So the venture those joint certainly at either of to other preference two this but sell markets, would not to grow the time. be

can to your on thinking sale? being an there just give close intention marketed what's you just year. on Got in And $XXX this for you $XXX how then to to that? How million the be million sell it, And thanks. any of Is announcement? update you're assets may

working we're on it. Constantly

hotels there international for been which Dori, hotels spin laundry in as I ventures. to disposed that's mean - I sold people the in in lifting, and some self-operated since well mentioned, we've XX. that's those over billion some addition we rid XX as XX that as that's facilities, has getting of aren't $X think included joint of heavy

proud the reshape and portfolio. work of all really and effort continuing to the So the

eight believe plus over months, XX minus hotels the I or sold, $XXX for about last million. We've

now. million our We a team Officer, number between distressed but to right are active price And going get and his a to that discipline. Morey, as got listings Investment in discussions, of not that we've somewhere Tom confident we're have Chief working seller. constantly maintain we and We're $XXX to $XXX are we'll million. said, hard we're

certainly expect right And now back be again in we back investment looking stock. and can we'll debt this that use the basis, obviously, that is best leverage-neutral future. those on at proceeds to you And buy pay we'll the a of can make discount kind at down our certainly buying stock

Tom. Thanks, Okay.

Okay.

from with your UBS. Robin comes question next Please Our Farley state question.

your Thanks. back just group. wanted to Great. to I circle

Robin. Hi,

Hi, Thanks. how are you?

total is? to which compared group. lot know gave cities. it's overall 'XX like excluding revenue you then Francisco, pace a group of of - sort don't on I whether color that commentary sort know I San if than I do what lot better total by by how XXXX for compared you great of wide to region, XXXX, or a 'XX? heard company Thanks. pace have And night room that Your sounds look the would

Yes.

XX XXXX and So, group San versus about XX.X% pace does and revenue does Francisco. that for exclude that is

that was 'XX, And you. right? versus Thank Okay.

Yes. 'XX. Yes. It's versus

That's Great. Thanks. me. for it

Sean.

Okay. Thank you.

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

- working you Appreciate

David. Hi

everyone. day, Good

Good day.

I capital forward? does that the we all San of you the capital capital that the that should amount post broaden standard And that's does how about the deployed accelerate going expecting work? lead - you of where investment about or thinking of to the just raise talked you bar and commentary some might be capital to the it and amount being Francisco of returns, put appreciate

distressed The on that's shares, that's balance I share 'XX a fully a we whether per to that emerge. lot be beauty that's classes, mean, mature right? lot 'XX that back of Without question, asset across We're David. it there's opportunities be sheet going $X gives of we will the buying nearly investing strategic all various us debt expect cash stronger. know optionality, between and participant. to whether in back and Look, sitting of a is we're today, ROI, could whether

leverage-neutral will we invest Today, clearly of particularly the will our flow use highest a And back a seeing we and sell a we're we'd on buy stock in say billion $X.X deal we're basis. best continue is table, and to our in liquidity. when the to continue back many to a our sitting be have And But noncore, like with at opportunistic. seat lot peers. in of portfolio

certainly Park as outlook it's for much brighter look So a forward. we

about. I really you. the That appreciate today. Okay. to what all Thank detail talk was I wanted

Thank you.

Your Gregory with next Miller question. state Truist from question Securities. comes Please your

taking afternoon. questions. Good Thanks Hi. our for

on business you is mid-single-digit So up commentary XXXX growth materializing. you first perhaps reasonable question on growth or At Sean's I Do above how have is transient see transient business on point, following negotiated corporate rate that? think room do rates. this

typically, in Greg, it's certainly big we're of don't any the early discussions think negotiates mid-single don't certainly, it's expectation unreasonable. had our Sean. be the I lot the certainly I fall. mean a you those with and many a to that range. think really I too process. - I is activity have see operators brands lot more more certainly and late going the But would in clearly fall - say in I digits

had F&B on pricing how and Or for the in in relative progressing cost outlets I F&B operating the F&B back banquets then your Thanks. And more pricing margins growth? and specifically, year? is trending Okay. the particular. of department on How is question second half is to

Yes.

for a what QX. I slightly F&B the think and stabilization QX I you quarter, probably versus between you down dip think profitability QX. will see in going on see

don't QX, And I group we was have think strong as quarter. again, to specifically, group a quarters. Just it going have in as other we much be

margins catering we'll get kind more higher think for in we'll think profitability. of F&B see the well higher versus our QX I higher So - on that in XXs banquet higher XXs margin mid-ish or higher get and well rate the again, as I as with business, - rates

I how So 'XX look think I we kind back more it. certainly, from kind of below tracking. year-to-date generally bit. it's a of of at of kind below It the be year, as kind 'XX by commensurate think right we'll think I think, the little the of a standpoint, profitability with now, ended half in But I

we're in and a about probably think little in I this last general, flat to of of 'XX. time kind catching they're think up 'XX getting later against gone year, So upwards higher. to single group of getting way just digits kind as the you a higher that really are from rates We've was contracting

kind higher-rated the catch as you here, getting obviously those over in to of the of pricing and better as think kind of So margins layer I in place contracts get up in kind time F&B you're well line. more

great. That's Thanks.

you. Thank

from Chris Green state Please Street. next Our your question with comes Darling question.

Good Thanks. morning.

Chris. Good Hi, morning.

disclose who Phoenix, in or Suites the land to or are public we should then there Good And leases other any can the you other options termination to that morning, of? aware Embassy whether Tom. owns a Related private be early related it's entity? ground

we hotels you up on. There that to are continue information available. make leases seven to joint And Chris it. you work now there have with have Look, will I and have monitor sure to don't are the in follow that we XX venture. several short-term portfolio.

company. as the Our of communicated of we've value account about XX% the top XX, before, XX assets, for

back of really and done lifting the So six, has it's earlier point that reshaping over last the portfolio. that the just heavy to the team seven years

lease that be of an and set obviously So to this was right prouder time the one we the noncore, their to Each on many short its find could been we've particularly not years commitment. working has there. so their solution, and was for It And with a right significant and asset contributor. got work certainly the of challenges. some outcome here, own wasn't ground remaining

do that by recognize disruption of about an switching early thinking this portfolio sense that for just 'XX comparable Just All relative happened year? on Maybe right. market you to property. into you how as the that a market certainly to Orlando, the start in the the gears going might U.S.? consider what Fair for work a get in well map estimate as size as enough trying have Thinking caused second. and for

certainly, people demand we've on. a you've that understand been it's got has political factors Yes. are mean elements market where couple there. of clearly, and one I got trying Disney going driver That to whether other - with some

center You're its think places out a with certainly of again, some you've fact convention combination maybe I Disney rates, other seen, didn't raising groups whether relative go the to aggressively product they that people options - it's people in the Europe shift And year. to seeing or combined now, have also have is have last of cruises, politics.

is booking you seeing our into think that Tom, mean, in I Orlando. we're for which prepared in for complex. normalizes year a remarks, do So something meeting space story space, I that spoke see interest to tremendous the us, for the of in clearly, amount more that next Bonnet.

in space in of into we new 'XX million we're far and talked another that the really about encouraged we've layering renovated product. certainly, So of relative $XX in, to booked terms what kind about asset so

not to next So uplift that certainly this of a I certainly think expect encouraged, talk contributor very a to year. -- the be portfolio good we're 'XX about kind comparable market. point good to certainly We at prepared from

me. That's from it. appreciate I all

Thanks.

we for you. questions Thank have now Tom hand that's I'll the remarks. And Baltimore closing today. the all to floor

a have of September taking various Have you your great great of to everyone summer, and we time the remainder look and forward summer. conferences. appreciate and seeing We in a many

may day. a you. This Have disconnect. Thank good concludes All parties conference. today's