Q4 2021 Braemar Hotels & Resorts Inc Earnings Call
Greetings and welcome to the Braemar hotels <unk> resorts fourth quarter 2021 earnings conference call. At this time, all participants are in a listen only mode.
A question and answer session will follow the formal presentation.
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As a reminder, this conference is being recorded.
I'd now like to turn the call over to Jordan Jennings manager of Investor Relations. Thank you you may begin.
Good morning, and welcome to today's call to review results for Braemar hotels, <unk> resorts for the fourth quarter and full year 2021 and to update you on recent developments.
On the call today will be Richard Stockton, President and Chief Executive Officer, Derek Eubanks, Chief Financial Officer, and Chris <unk>, Senior Vice President and head of asset management.
Result, as well as notice of this possibility at this conference call on a listen only basis over the Internet were distributed yesterday in a press release.
At this time, let me remind you that certain statements and assumptions in this conference call contain or are based upon forward looking information and are being made pursuant to the safe Harbor provisions of the federal Securities regulations. So that's why we're looking statements are subject to numerous assumptions, uncertainties and known or unknown risks, which could cause actual results to differ materially.
Really from those anticipated. These factors are more fully discussed in the company's filings with the Securities and Exchange Commission.
Before looking statements included in this conference call are only made as of the date of this call and the company is not obligated to publicly update or revise them.
Statements made during this call do not constitute an offer to sell or a solicitation of an offer to buy any securities.
These will be offered only by means of a registration statement and prospectus, which can be found at www Dot SEC Gov.
In addition, certain times used in this call are non-GAAP financial measures reconciliations of which are provided in the company's earnings release and accompanying tables or schedules, which have been filed on form 8-K with the SEC on February 24, 2022, and May also be accessed through the company's website at www Dot HR REIT dotcom.
Each listener is encouraged to review those reconciliations provided in the earnings release together with all other information provided isn't really.
Now I'll turn the call over to Richard Stockton. Please go ahead Richard.
Good morning.
And welcome to our fourth quarter earnings Conference call.
I will begin by providing an overview of our business and an update on our portfolio. After that Derek will provide a review of our financial results and then Chris will provide an update on our asset management activity afterward, we will open the call for Q&A.
We have five key themes for today's call.
First our luxury resort portfolio continues to outperform and helped drive comparable hotel EBITDA of $35 $5 million for the quarter, an increase of 12, 2% versus the comparable quarter in 2019.
Second we continue to be cash flow positive at the corporate level third our portfolio is well positioned to continue to outperform with very strong forward bookings.
Fourth our balance sheet is in good shape and with our recent refinancing of the park Hyatt Beaver Creek, we have no near term debt maturities.
And fifth we announced the pending acquisition of the Dorado Beecher Ritz Carlton Reserve and Dorado, Puerto Rico, one of the most iconic luxury assets in the Americas.
Our comparable hotel EBITDA of $35 $5 million during the quarter was driven by strong occupancy levels at our resort properties and an 18, 5% increase in ADR over the prior year quarter.
Additionally, revpar for all hotels in the portfolio increased approximately 163% for the fourth quarter of 2021 compared to the fourth quarter of 2020.
Our portfolio Revpar increased approximately six 3% when compared to fourth quarter 2019, Revpar and ADR was up over 32% compared to the fourth quarter 2019.
In fact in the fourth quarter, we achieved the highest quarterly revpar in our company's history, and we're very encouraged to see our portfolio getting so close to our full year 2019 revpar levels.
We entered 2022 excited about our opportunities to deliver continued growth in <unk>.
Spec to achieve full year 2019, revpar levels, but this calendar year and also expect to meet or exceed full year 2019 hotel EBITDA by calendar year 2023.
As we have said before we believe our portfolio will get back to 2019 levels before most of our peers, given our portfolio composition and quality.
But also certain factors that made 2019, not a great benchmark year for us specifically.
We had three of our properties under major renovation, including the notary the Clancy and the Ritz Carlton St. Thomas.
Several of our hotels achieved very strong hotel EBITDA margins during the quarter with BARDA Center at 41% Hotel Yountville at 46% and Pier House resort at 57%.
Our overall portfolio comparable EBITDA margin was 27, 1%, despite including one hotel with negative hotel EBITDA.
While leisure demand continues to be strong, particularly on weekends any significant uptick in revpar performance is likely to rely on the recovery of corporate transient demand.
And ultimately corporate group demand.
Overall, our resorts have started the year strongly despite industry wide pullback associated with omicron.
For the month of January we finished at 44% occupancy and an ADR of $500, which equated to revpar exceeding 2019 levels by two 6%.
For February we expect to exceed 55% occupancy with continued revpar outperformance versus 2019.
The Ritz Carlton St. Thomas continues to be a standout performer.
Producing $6 6 million in hotel EBITDA during the fourth quarter.
For the full year, our Ritz Carlton Saint Thomas had approximately $28 million of hotel EBITDA, which is a phenomenal result, when you consider that we acquired this hotel for $65 million in 2015 and have funded only approximately $30 million in owner funded capital expenditures over that time.
Many of our hotels are in drive to leisure markets that have been well positioned to benefit from the resurgence of pent up leisure demand in recent months in total eight of our 14 hotels are considered resort destinations.
These hotels include the Ritz Carlton Sarasota Artesano.
Yeah, Bill the Ritz Carlton Lake Tahoe Pier House resort Hawkeye at Beaver Creek, Hilton La Jolla, Torrey Pines, and the Ritz Carlton St. Thomas.
We're pleased to report that this segment delivered a combined hotel EBITDA of $31 $8 million for the quarter.
I also continue to be encouraged by the advancing recovery of our urban properties. These properties include the capital Hilton and Marriott Seattle waterfront, the notary hotel.
Nancy Mr.
Mr C Beverly Hills, and the Sofa tell Chicago.
For the fourth quarter five of these six properties posted positive hotel EBITDA. This is a significant turnaround of demonstrates that demand is quickly returning to our cities both amongst the leisure and to a lesser extent the corporate transient segment.
We expect this trend to accelerate as office reopening as continue during 2022.
Additionally, we were cash flow positive again at the corporate level for the fourth consecutive quarter, while our balance sheet is in good shape as we enter 2022. This puts us in a much stronger position financially.
We're also happy to be continuing to implement our growth strategy with the announcement of the pending acquisition of the 96 room Dorado Beach, a Ritz Carlton Reserve and Dorado, Puerto Rico for $186 $6 million.
And iconic luxury asset the Dorado Beach was the first Ritz Carlton reserve in the Americas and is one of only five Ritz Carlton reserve properties worldwide.
This premier beachfront location on the North coast of Puerto Rico. The property is situated within Dorado Beach resort, a 1900 acre master planned community and one of the most sought after residential real estate markets in both Puerto Rico as well as the United States.
The ultra luxury asset offers guests numerous world class amenities, both within the resort as well as the surrounding development and.
In addition, we will also be acquiring the income stream attributable to 14 luxury residential units adjacent to the ultra luxury resort that participate in a rental management program.
We believe this property will be a great addition to our portfolio and are very excited about the prospects of this acquisition as the hotels performance during the fourth quarter delivered revpar of $1432 and.
And with 66% occupancy and an ADR of $2165.
We plan to complete the acquisition in the coming weeks.
Looking ahead, we continue to see a meaningful uptick on acquisition opportunities in the market. We will continue to be extremely disciplined in our investment approach and only focus on transactions that are accretive to shift to total shareholder return.
On the capital markets front, we continue to raise capital via our our non traded preferred stock and subsequent to quarter end, we completed the refinancing of the park Hyatt Beaver Creek resort and Spa at very attractive terms, Derek will provide more details on that in a moment importantly.
Importantly.
Our balance sheet is in good shape, and we have an attractive maturity schedule with our next hard maturity not until April 2023.
We've also been active on the Investor Relations front over.
Over the past few months, we've attended several investor conferences and participated in numerous investor meetings.
We also held a well attended Investor day in New York, a couple of weeks ago.
In the months ahead, we will continue to get out on the road to meet with investors to communicate our strategy and the attractiveness of an investment in Braemar.
Looking ahead, our unique portfolio focused on the luxury segment with many properties and drive to leisure markets positions us to perform well in both the near term and long term as business and group travel resumes. We continue to believe that Braemar represents a compelling opportunity in the lodging REIT space.
We are differentiated story.
With the majority of our assets in very desirable resort locations.
The highest quality portfolio in the public markets a portfolio that is generating positive cash flow at the corporate level and.
And what we believe is a solid liquidity position and balance sheet with attractive debt financing in place.
I will now turn the call over to Derek.
Thanks, Richard for the fourth quarter of 2021, we reported a net loss attributable to common stockholders of $4 3 million or <unk> <unk> per diluted share.
For the full year of 2021, we reported a net loss attributable to common stockholders of 40 $401 million or <unk> 76 per diluted share.
For the quarter, we reported <unk> per diluted share of 23, <unk> compared to <unk> <unk> of negative <unk> 17 per diluted share in the prior year quarter.
For the full year of 2021, we reported <unk> per diluted share of <unk> 80.
Adjusted EBITDA for the quarter was $29 $4 million and we were cash flow positive at the corporate level for the quarter.
Adjusted EBITDA for the full year was $87 5 million.
At quarter end, we had total assets of $1 9 billion.
We had $1 2 billion of loans of which $49 million related to our joint venture partner share of the loan on the capital Hilton and Hilton La Jolla Torrey Pines.
Our total combined loans at a blended average interest rate of two 7%.
As of the end of the fourth quarter, we had approximately 46% net debt to gross assets.
We ended the quarter with cash and cash equivalents of $216 million and restricted cash of $47 4 million.
The vast majority of that restricted cash is comprised of lender and manager held reserve accounts.
At the end of the quarter, we also had $27 $5 million and due from third party hotel managers. This primarily represents cash held by one of our brand managers, which is also available to fund hotel operating costs.
As Richard mentioned, our comparable hotel EBITDA during the quarter was $35 $5 million.
After taking into account debt service G&A costs advisory fees and other corporate cost preferred dividends and capital expenditures for the full year, we generated over $18 4 million of positive cash flow.
Subsequent to quarter end, we completed the refinancing of the park Hyatt Beaver Creek resort and Spa on very attractive terms, the new non recourse loan totaled $75 million has a two year initial term with three one year extension options subject to the satisfaction of certain conditions.
One is interest only and provides for a floating interest rate of sofa plus to eight 6%.
The financing address the company's only final debt maturity in 2022 and illustrates that there is attractive financing available for high quality assets like those in our portfolio.
I'm also pleased to report that since we launched the effort in July of last year, we have raised approximately $62 $4 million of net proceeds from our series E series M. Non traded perpetual preferred stock we expect the proceeds from the sale of the series E and series M. Non traded perpetual preferred stock to be our primary source of capital to <unk>.
<unk> our growth this capital raising effort is just getting started and we look forward to reporting our progress in future quarters.
As Richard mentioned subsequent to quarter end, we announced the pending acquisition of the Dorado Beach, a Ritz Carlton Reserve and Dorado Beach, Puerto Rico total consideration for the acquisition is $186 6 million or $1 $7 million per key inclusive of the residential units in the rental program the acquisition will be funded with.
$104 million of cash 6 million shares of common stock and the assumption of a $54 million mortgage loan.
No additional equity will be issued to fund the cash portion of the consideration the.
The cash portion of the consideration will be funded from available excess cash.
As of December 31, 2021, our portfolio consisted of 14 hotels with 3640 net rooms, our share count currently stands at 72 5 million fully diluted shares outstanding which is comprised of $65 4 million shares of common stock at $7 2 million op units.
And our financial results. We include approximately $4 1 million shares and our fully diluted share count associated with our series B convertible preferred stock and approximately $13 6 million shares and our fully diluted share count associated with our convertible senior notes.
This concludes our financial review I would now like to turn it over to Chris to discuss our asset management activities for the quarter.
Thank you Derek comparable Revpar for our portfolio increased 163% during the fourth quarter relative to the same time period in 2020.
This portfolio is thriving with our fourth quarter revpar exceeding comparable 2019 by 6%.
This outperformance is a testament to the quality of the portfolio and the efforts of our asset management team.
Our Yahoo hotels achieved a combined 43% revpar increase over comparable fourth quarter 2019.
Artesano hotel and spa generated over $2 million more than total revenue during the fourth quarter of 2021 in the comparable period in 2019, representing a 42% increase.
This revenue growth was driven by a recently developed luxury villas. The villa produced nearly $580000 in room revenue during the fourth quarter and approximately $2 million during the full year of 2021.
<unk> also showed strong results producing nearly $900000 more in total revenue during the fourth quarter than in the comparable period in 2019.
We have increased topline revenue through higher seasonal premiums on upgraded room types and by implementing more stringent seasonal blackout blackouts to discounting programs.
Next the Ritz Carlton Sarasota had its best best fourth quarter on record with more than $23 million in total revenue, representing a 29% increase over the next highest comparable fourth quarter.
The hotel also recorded nearly $83 million in full year total revenue and $25 7 million in hotel EBITDA, both outperforming historical highs on record by 26% and 88% respectively.
These results were driven by initiatives that we identified prior to the acquisition of the hotel, including selling up the hotels club membership program, which represents nearly $6 million in long term annual revenue optimizing the hotels business mix and implementing long term labor efficiencies.
Lastly, I would like to highlight our most recent acquisition Mr C, which realized a three 4% revpar gain during the fourth quarter relative to the comparable period in 2019.
The hotel has already significantly outperformed our investment underwriting.
We are taking over the hotel our asset management team developed a 70 point plant to increase stabilized hotel EBITDA by more than a $1 million.
The plan included reducing dependency on Otas and capitalizing on weakened demand with higher rates on premium room types.
Additionally, we improved labor productivity by reengineering the staffing model. Both of these initiatives have already resulted in success with fourth quarter ADR, increasing above 2019 levels by more than 2% and fourth quarter departmental expense margin improving by nearly 450 basis points relative to 2019.
And Mr. C Hotel is our only urban properties to outperform its 2019 comparable quarter.
Moving on to capital investment, we have invested heavily in our portfolio over the last several years to enhance our competitive advantage.
These investments uniquely position our portfolio to benefit from the pent up demand that we are currently seeing in our markets.
In 2021, we were able to restart and complete a number of exciting value add projects across the portfolio.
These included a new cafe at the Beach club at the Ritz Carlton Sarasota, and the addition of 10 keys at a cost of $138000 per key.
In total we spent approximately $26 million on capital expenditures in 2021 booking.
Looking ahead to 2022, we anticipate spending approximately $60 million to $70 million on capital expenditures.
I would like to finish by expressing how optimistic we are about the future of this portfolio.
Our 14 hotels are already exceeding 2019 revpar levels.
Those eight hotels lifted the whole portfolio to a 6% revpar increase during the fourth quarter relative to the comparable 2019.
Nearly all of the remaining hotels are located in urban destinations such as Chicago, Philadelphia, San Francisco, Seattle, and Washington DC.
It's still a significant amount of additional runway and potential to unlock in this portfolio, which we believe will allow us to continue to outperform in the future.
I will now turn the call back over to Richard for final remarks.
Thank you Chris in summary, we continue to be pleased with the recovery trends, we're seeing at our hotels driven by strong leisure demand at our luxury resort properties, we see a clear path for continued strength and our future financial results. We are well positioned moving forward with a solid balance sheet and a unique diversified portfolio.
Look forward to updating you on our progress in the quarters ahead. This concludes our prepared remarks, and we'll now open the call up for Q&A.
Thank you we will now be conducting a question and answer session. If you would like to ask a question. Please press star one on your telephone keypad.
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Our first questions come from the line of Bryan Maher with B Riley Securities. Please proceed with your questions.
Good morning.
Thanks for all that commentary.
Richard when we think about the affluent traveler in 2022 and beyond.
Clearly there was a lot of both revenge travel and the inability to go abroad for those who can afford it.
Driving ADR and a lot of your properties, how do you think ADR kind.
Kind of unfold as we hit the back half of 2022 and 2023.
Yeah, Brian Thanks for that.
<unk>.
The I would say a couple of things.
Yes.
We're actually achieving ADR at some of our properties that are just setting records and I think thats in some ways great in some ways a concern.
And the concern is can we keep it up.
We did it in the ADR for the year of $389.
I think a couple of things are going to happen I think as.
Business travel comes back.
The people that are traveling now and have more flexibility in their schedules and are spending time with our resorts are going to be on the road and attending meetings and groups and conferences.
And it's kind of a zero sum game, so instead of them.
Traveling for leisure purposes, they are traveling for business purposes. So to an extent there is any air led out of that leisure bubble.
It gets back built with with urban demand and that's what's great about the balance of our portfolio. Our urban properties historically contributed as much EBITDA as our resort properties and there's really a ton of upside to be had there. So.
That's how I see things evolving so I think it's resilient.
Because of that I think the leisure rates that we've been able to achieve.
Arent going to fall precipitously I think once you're affluent traveler gets used to paying $1000 a night for a room, they're going to continue to do so.
Our hotels are going to continue to earmark those rates at that level.
So I'm not I'm not concerned about a dramatic pullback in any way.
Is it safe to say that may be ADR could come back on the at leisure travel air occupancy upticks at a decent rate from business travel to the urban properties and at the end of the day the total portfolio Revpar.
Hold it down or grow from current levels is that a fair way to think about it.
Yes, that's that's what I'm, saying is how I'm thinking about it Chris the only thing I'd add Brian is.
We're not seeing any signs of a slowdown in terms of leisure ADR all forward indicators from what we're seeing are very very positive.
We've done a number of things across our portfolio to try to capitalize on that leisure demand and sustain those <unk>, we built out the luxury villas in Barcelona, we did the key additions in Sarasota, and we're looking at a residential rental programs to see where we can increase participation.
<unk> units drive very high rates across the portfolio, but I think I think <unk> got it pegged.
If there is a leisure pullback when that happens we expect to see a resurgence of.
The urban hotels and corporate travel that we think are largely offset that.
Okay moving on to acquisitions.
I think and correct me, if I'm wrong I think the appetite.
It was maybe two properties a year.
Can you let us know do you think that that's changed at all and should we expect to see some of this creative financing that you've done on your two most recent properties, which are a combination of cash on hand shares assumption in that is that how we should think about financing going forward and maybe just lastly on that is there some kind of a dollar.
That in your head that you think you'd like to spend on acquisitions per year.
Yes, sure thanks for that Brian well, firstly, the acquisitions environment continues to be very active and very interesting in terms of the pipeline and deal flow things that we're seeing.
There are a lot of properties available for sale.
I think they are predominantly resort properties.
That said, we've done one urban acquisition and one resort acquisition, we will continue to be balanced in our view in terms of portfolio composition.
In terms of Quantum's, Yes, I think our range is 1% to three per year I would like to continue to do about two acquisitions a year about the $250 million in gross asset value that we approximately.
Announced last year.
So I don't see that changing.
Fundamentally and.
Yes, I think for now.
That's being driven a lot by the fact that we're very very picky right we use.
We look at a lot of deals.
<unk> disciplined in how we underwrite our deals and many of them.
Or just not attractive based on where they are being offered but that said we've been successful in the past identifying one or two great acquisitions and I expect that to continue going forward.
In terms of the way we acquire in the consideration.
I do think utilizing OPE units for shares.
In the right amounts is a very attractive way to give us the upper hand in a negotiation.
We've had now two deals that we've announced where we very much had sellers who were very eager to become braemar shareholders.
And they wanted to roll their property into the best portfolio on the Street.
And realize the upside from that.
Now, we just have to be very careful given where the share price was at the time of the deal.
To have that translated into the right acquisition price and I believe we've been able to do that.
So we will continue to be very strict and the way we look at that but it is a creative way that I think helps sellers to get comfortable with us as a buyer and in some cases maybe.
Not at the highest price.
Yes, I think the assumption of debt is something that we can also use.
When it's appropriate whether it's helpful to the seller. It is helpful to the lender or.
It offers us a cost of debt that we find particularly attractive.
So we'll always continue to look at that too.
But I will say the financing markets are pretty healthy you saw the refinancing of our park Hyatt Beaver Creek at a levels that approximated, where we finance that asset on acquisition in 2017.
So there is debt available.
Even from relationship banks, who are probably our preferred lenders at this point.
So.
We think on acquisition financing.
Don't necessarily need to assume that we can find it if we need it so we'll assess every situation.
Across a number of those different metrics be creative where we can and try to get some deals done.
Okay, and just last from me and try and be quick on this one yes. The Dorado Revpar and ADR is just off the charts can you give us a little color on how you think command $2000 plus an ADR I mean are the room sizes huge I mean, a lot of us have not had the opportunity to be there and how should we think about the income stream from the 2014 luxury.
Residents, how do we think about that where is that can be classified is that going to be under 100 for modeling purpose under revenue other revenue for modeling purposes.
Yeah. So first you hit the nail on the head. The reason, we're able to achieve over $2000 90, <unk>, because the rooms or the size of those suites.
Rim sizes 200 square feet Youre standard King is almost 1000 square feet right, so youre more than twice the.
A typical luxury room size they have outdoor showers.
As well as indoor showers they have.
Plunge pools.
There is just a very large luxury room product.
And that's driving it it's that plus when you incorporate the village right and the villas and the rental program range from 3000 5000 square feet.
They command.
Upwards of $10000 a night in rate.
You are able to really drive that ADR. So that's what's doing it what we're doing with the rental management program. The rental program is incorporating that revenue into rooms revenue and incorporating incorporating that into our calculation of revpar.
So that's that's how we're treating that.
Yeah. Thank you very much.
Okay.
Okay.
Thank you. Our next question is coming from the line of Michael Bellisario with Baird. Please proceed with your questions.
Thanks, Good morning, everyone.
Just a quick follow up there on the economics any percentage you can put around relative to that stabilized multiple you guys have provided.
What sort of NOI is coming from.
The rental pool versus the hotel.
Well are we I don't think we're doing that segment reporting actually.
It's a little it's a little tricky to get to NOI, because you have to do allocations.
When you have a rental program and so that's not anything that will we will be publishing because it's more of a theoretical exercise frankly.
Okay Fair enough thought I'd ask and then just.
While we're on Puerto Rico.
I understand how you evaluate risks there versus.
Versus investing an incremental dollar states out here in the U S. Yes, sure. That's a great question I mean, the thing that was attractive about Puerto Rico and the opportunity came up this year.
You are investing in our U S territory right. So its U S currency at U S laws.
He is very familiar.
There are no friction as far as taxes are concerned in fact, it's the opposite there are very favorable tax exemptions you get by investing on the island.
So.
When we given our experience in St. Thomas I think that made it a lot easier for us to go there certainly.
Certainly in the Caribbean one of the risks that people are concerned about is weather.
I've talked about our experience in St. Thomas.
And time again in our risk management program.
Best in class and I think as protects us from any sort of a weather related event on that property. So I think that is something that is.
A key advantage for us that allows us to.
Assess risks in that market in <unk> and.
And put our capital to work there in a way I think a lot of other companies just simply can't.
We have a very favorable umbrella policy that.
It really came through for us on the St. Thomas rebuild in.
We couldnt be more pleased with the financial results for shareholders there.
So that's how we're assessing it I don't know that.
Puerto Rico has other other major risk beyond that the <unk>.
Airlift is literally 10 times, what it is in St. Thomas.
It's been attracting a lot of professionals from the mainland.
Due to the tax incentives offered there so thats very favorable trends economically.
Much better there was certainly some downturn related to.
The 2019 storm in 2017 storms, but doing much better as well so.
We love, Puerto Rico, as a beautiful place I'd encourage you to go there.
Beaches are absolutely stunning.
And I think as people discover it.
So we'll continue to outperform.
That's helpful and then just.
Last one on the investment side as just you look at.
Other investment opportunities how big is the math that you were looking at it.
Caribbean locations, Mexico Central America, what would be of interest to you what would not be.
Yes, it's a good question that there does seem to be more.
Coming to market in those markets the Caribbean, Mexico Central America.
Yes.
Very reluctant to take on currency risk.
So.
Luckily most of the Caribbean markets.
Use the east Caribbean, which is pegged to the U S. Dollar there are some.
Central American markets that are actually pegged to like Panama pegged to the U S dollar and then Mexico and certain.
Installations might as well be U S. Dollar just in terms of how they operate.
All of that said.
The other thing that we look at carefully as if there is any friction related to taxation.
So we will continue to look at that but but we certainly haven't ruled out the areas that you described but it really has to be as to as to check the box of.
Limited currency risk.
Certainly limited risk of nationalization or you know what I would call geopolitical risk and then limited tax friction.
So so we feel extraordinarily comfortable with St. Thomas Puerto Rico, we haven't done anything in a non U S territory, yet but.
But we'll continue to look because there had been some attractive things that have come up recently.
Our available for sale.
Got it that's helpful. And then just last one for me on the preferred issuance are you now opening up that offering to more brokers and then what's the trajectory.
At least your expected trajectory of getting to.
Publicly state it maybe $300 million targeted kind of how you think about the timeline of getting there.
Hey, Mike This is Derek I'll take that one.
Yes, you are correct the offering continues to sign up additional dealer agreements with additional brokers. So we would expect that.
Sort of trajectory to continue to ramp up.
Good to know in terms of guidance of when we hit that target raised level.
But it's a continual offering that is open and we do we do close is every two weeks so we.
We would expect that progress to continue to ramp up.
Great. Thank you. Thanks.
Thank you as a reminder, if you would like to ask a question. Please press star one on your telephone keypad.
Our next questions come from the line of Tyler <unk> with Janney. Please proceed with your questions.
Thank you good morning.
Follow up questions.
For me.
Clearly the business moving in the right direction here.
How are you thinking about the common dividend, while potentially does that makes sense.
Thinking about essentially payout ratios versus historical and also balancing dividends versus some of the attractive acquisition opportunities as well.
Yes, it's Alan Thanks for that question.
<unk>.
We continue to assess our liquidity and cash flow and also what's happening in the sector with our peers.
We do we do believe that there are some funds out there that are that our yield focused in wood.
I would like to see at least some sort of dividend program reinstated.
All I can tell you is the board will continue to analyze that.
We're doing very well financially.
You see some activity amongst our peers in terms of reinstitute reinstating dividends.
So that's.
That's about all the news I have on that at this time.
Great Great in terms of the Capex spend I mean, you spent.
$26 million roughly in 2021, I mean, I apologize if I missed that did you give out a number for expected spend in 2022.
We did we gave a range of 60 to $60 million to $70 million.
Is there any I guess deferred capex that's in their money would've spent in 2020 or 2021 that that's that's that's shifted in kind of how.
Are you thinking about a normalized maintenance capex.
Into the future.
Yes, Tyler about about a third of that is deferred from this year into next year.
Yeah and in terms of ongoing reserves I mean, as you know, it's kind of an industry standard to reserve about 5% of revenues for maintenance Capex. Obviously, if you look at the hotel.
Outreach across the board typically spend.
Well in excess of that so we would we would anticipate supplementing some of that with with owner funding.
But I don't know if we're prepared to kind of give you some guidance in terms of percent of revenue target that we're going to set to achieve going forward.
But yes.
We've got guidance out there for Capex spend for 2022, and just know that by normal course, we're reserving roughly 5% of revenues into ongoing <unk> reserves.
Okay.
That's all for me and I'll leave it there. Thank you.
Thank you there are no further questions at this time I would like to turn the call back over to management for any closing comments.
Alright, well thanks, everyone for joining us on our fourth quarter earnings call. We look forward to speaking with you again on our next call.
Goodbye.
This does conclude today's teleconference. We appreciate your participation you may disconnect. Your lines at this time enjoy the rest of your day.