Q3 2023 Host Hotels & Resorts Inc Earnings Call

[music].

Good morning, and welcome to the host hotels <unk> resorts third quarter 2023 earnings conference call.

Today's conference is being recorded.

At this time I would like to turn the call over to Jamie Marcus Senior Vice President of Investor Relations.

Okay.

Yeah.

One moment, please I'm, having a slight technical difficulty.

Yeah.

One moment.

Yeah.

Okay.

[music].

Uh huh.

President and Chief Executive Officer.

And sorry, Oh, Gosh, executive Vice President and Chief Financial Officer.

With that I would like to turn the call over to Jim.

Thank you, Jamie and thanks to everyone for joining us this morning.

Before we turn to the quarter I want to take a moment to acknowledge the devastating wildfires that occurred on the island of Maui. This past August.

All of us at host, we're deeply saddened by the loss of life and heartbreaking impact on local communities.

As the largest hotel real estate owner on Maui for over 20 years post has long shared a connection to the island and helping to support the community through this difficult time is important to our company.

We are proud to have aided recovery and rebuilding efforts donating more than $250000 to emergency response and relief organizations as well as providing direct financial assistance and relief to our hotels' employees.

We also provided food and shelter to these employees their families and emergency response teams.

The strength and resilience of the Maui community inspires us and we are committed to supporting them as the recovery continues.

Now, let's move to our results for the quarter.

Please note that the results presented on today's call represent the comparable hotel portfolio, which includes all three Maui resorts and continues to exclude the Ritz Carlton Naples, and Hyatt Regency coconut point.

When applicable we will provide estimated impacts from Maui to certain results to provide a more comprehensive view of business trends in the quarter.

During the third quarter, we delivered a comparable hotel revpar improvement of one 8% compared to the third quarter of 2022.

Our revpar performance for the quarter was driven by an occupancy increase of 150 basis points led by our convention hotels in downtown locations.

Overall, Maui had less of an impact on our results than we initially expected as we were able to replace high rated transient business with recovery and relief group business, which impacted our demand mix this quarter.

We delivered adjusted EBITDA.

$361 million, which includes $54 million of business interruption proceeds from hurricane Ian and delivered adjusted <unk> per share up 41.

<unk> consensus on both metrics.

Third quarter comparable hotel EBITDA margin of 26, 6% exceeded 2019 by 10 basis points and this marks the sixth consecutive quarter since the onset of the pandemic that we have achieved revpar revpar comparable hotel EBITDA margins.

Ahead of 2019 levels.

Comparable hotel Revpar for October is expected to be approximately $229, a two 4% improvement over 2022.

We estimate that the Maui wildfires impacted third quarter comparable hotel Revpar by 60 basis points comparable hotel trip powered by 120 basis points and comparable hotel EBITDA by $4 $5 million, our risk management team is continuing to engage with our insurers about.

Potential business interruption coverage and the timing and amount of any potential proceeds are not yet no.

Despite the wildfires on Maui, which we expect will impact our full year revpar guidance by 50 basis points, we maintained the midpoint of our previous full year expected comparable hotel revpar growth at 8% and tightened our full year revpar growth guidance range to seven.

Two 5% to 875%.

At the midpoint of our guidance full year 2023 comparable hotel EBITDA is forecasted to be eight 5% above 2019 with comparable hotel revpar growth five 6% greater than 2019.

As we look at the current macro picture, we continue to be optimistic about the state of travel for several reasons.

First group business continues to improve.

During the quarter, we booked 245000 group rooms through 2023, and total group revenue pace is now six 7% ahead of the same time 2019 up from four 2% as of the second quarter.

Even without the recovery and relief groups on Maui total group revenue would have been above.

<unk> 2022 and 2019.

The group booking window continues to extend and we are pleased with the base we have on the books for next year.

Second business transient demand continued its gradual improvement during the third quarter.

Business transient revenue was up approximately 9% to 2022 and demand improved 5% compared to the third quarter of 2022.

Overall business transient revenue was down approximately 16% compared to 2019 with room nights down approximately 20%.

Room nights have gradually improved throughout the year in January we were down nearly 23% to 2019 and in September we were down just 17% 2019, we see the continued evolution of business travel as a tailwind in the future.

Speaker 1: Leisure rates at our resource remain well above 2019 levels, despite continued moderation in the third quarter, as expected.

Third leisure rates at our resorts remained well above 2019 levels. Despite continued moderation in the third quarter as expected for context transient rates at our resorts were 56% above 2019 in the third quarter, which is particularly impressive.

Speaker 1: For context, transient rates at our resorts were 56% above 2019 in the third quarter, which is particularly impressive when considering that this excludes the benefits from our two newly renovated, non-comparable hotels in Florida and includes the impact from our three resorts on Maui.

When considering that this excludes the benefits from our two newly renovated non comparable hotels in Florida and includes the impact from our three resorts on Maui.

Fourth we expect international demand to be a positive trend going forward.

Speaker 1: Fourth, we expect international demand to be a positive trend going forward.

Speaker 1: International in-bond aircraft increased to 88% of 2019 levels in September .

International inbound air traffic increased to 88% of 2019 levels in September.

Speaker 1: up from 80% in June . At the same time, international outbound eartraffic increased to 118% of 2019 levels after hovering near 108% in January , which indicates that consumers continue to prioritize travel.

Up from 80% in June.

At the same time international outbound air traffic increased to 118% of 2019 levels after hovering near 108% since January which indicates that consumers continue to prioritize travel.

Speaker 1: As evidenced by recent booking volume trends for US airlines, the International Inbalance is likely to revert to 2019 levels over time.

As evidenced by recent booking volume trends for U S Airlines, the international imbalance is likely to revert to 2019 levels overtime.

Speaker 1: Most importantly, we are not seeing evidence of a weakened consumer at our hotel.

Most importantly, we are not seeing evidence of a weakened consumer at our hotels.

Speaker 1: Booting beverage outlet revenues remain both above 2022 and 2019, driven by resorts and non-resorts alike, which is encouraging given that occupancy still lags 2019 level.

Food and beverage outlet revenues remained both above 2022, and 2019, driven by resorts and non resorts alike.

Which is encouraging given that occupancy still lags 2019 levels.

Speaker 1: golf and spa revenues also remain significantly ahead of pre-pandemic levels.

Golf and Spa revenues also remains significantly ahead of pre pandemic levels.

Speaker 1: Taken together, we believe this indicates the consumers, continue desire and ability to spend on experiences at our hotel.

Taken together, we believe this indicates to consumers' continued desire and ability to spend on experiences at our hotels.

Speaker 1: Moving to our reconstruction efforts following Hurricane Ian, the newly transformed risk-carol to Naples has been very well received since its reopening in July . And we are optimistic that the resort is set up to exceed our underwriting expectation.

Moving to our reconstruction efforts following hurricane in the newly transform rich Carlton Naples has been very well received since its reopening in July and we are optimistic that the resort is set up to exceed our underwriting expectations.

Speaker 1: Transient rates for 75% above 2019 for the second half of this year, driven by the increased sweet mix and the new Vanderbilt tower.

Rates for 75% above 2019 for the second half of this year driven by the increased sweet mix and the new Vanderbilt tower.

Speaker 1: Looking forward to festive season, club level room night booking pace is up more than 20% over the same time in 2019, with an ADR premium of almost $900. And sweet bookings are pacing up 125%, with a more than $1300 rate increase over 2019.

Looking forward the festive season club level room night booking pace is up more than 20% over the same time in 2019 within ADR premium of almost $900 and sweep bookings are pacing up 125% with a more than $1300 rate increase.

Over 2019.

Speaker 1: We are proud of the well-deserved attention the Ritz-Parl to Naples is receiving, including regaining the coveted triple A five diamond designation, and we look forward to seeing the results that delivers in the years to come.

We are proud of the well deserved attention the Ritz Carlton Naples is receiving including regaining the coveted AAA five diamond designation and we look forward to seeing the results it delivers in the years to come.

Speaker 1: In terms of insurance proceeds related to hurricane EM, to date we have received $208 million of the expected potential insurance recovery of approximately $310 million for covered costs. During the third quarter, we receive $54 million of business interruption proceeds, and we expect to receive an additional $26 million of business interruption proceeds in the fourth quarter.

In terms of insurance proceeds related to hurricane Ian to date, we have received $208 million of the expected potential insurance recovery of approximately $310 million for covered cost.

During the third quarter, we received $54 million of business interruption proceeds and we expect to receive an additional $26 million of business interruption proceeds in the fourth quarter.

Speaker 1: Turning to Group, Revenue exceeded 2022 by 10% in the third quarter. Marking the fifth consecutive quarter, Group Revenue exceeded 2019. Definite Group Room Nights on the books for 2023 increased to 4 million in the third quarter, which represents approximately 110% of comparable full year 2022 actual Group Room Nights, up from 103% as of the second quarter.

Turning to group revenue exceeded 2022 by 10% in the third quarter, marking the fifth consecutive quarter group revenue exceeded 2019.

Definite group room nights on the books for 2023 increased to $4 million in the third quarter, which represents approximately 110% our comparable full year 2022 actual group room nights up from 103% as of the second quarter.

Speaker 1: For four year 2023, total group revenue pace is up approximately 20% to the same time last year, and up 6.7% to the same time 2019, in part two to recovery and relief groups on Maui. Group rate on the books is up 7% to the same time last year, a 40 basis point increase since the second quarter.

For full year 2023, total group revenue pace is up approximately 20% to the same time last year and up six 7% to the same time 2019, and part two to recovery and relief relief groups on Maui.

Group rate on the books is up 7% at the same time last year, a 40 basis point increase since the second quarter.

Looking ahead to 2024, we have $2 6 million definite group room nights on the books, a 15% increase since the second quarter.

Speaker 1: Looking ahead to 2024, we have 2.6 million definite group room nights on the books, a 15% increase since the second quarter. Total group revenue pace is up 13% to the same time last year, driven fairly evenly by room nights and rates.

Total group revenue pace is up 13% to the same time last year, driven fairly evenly by room nights and rate.

Speaker 1: We are encouraged by the ongoing strength of group as evidenced by increasing pace, strengthening booking windows, and improving city-wide calendar.

We are encouraged by the ongoing strength of group as evidenced by increasing pace lengthening booking windows and improving citywide calendars.

Moving to portfolio reinvestment, we are excited to announce that we reached an agreement with Hyatt to complete transformational reinvestment capital projects at six properties in our portfolio.

Speaker 1: The properties include the Grand Hyatt Atlanta, the Grand Hyatt Washington DC, the Grand Hyatt San Diego, the Hyatt Regency Austin, the Hyatt Regency Capitol Hill, and the Hyatt Regency Reston.

The properties include the Grand Hyatt Atlanta, the Grand Hyatt, Washington, DC, the Grand Hyatt San Diego, the Hyatt Regency, Austin, the Hyatt Regency Capitol Hill, and the Hyatt Regency Reston.

Building on the success of the Marriott transformational capital program. We believe these portfolio investments will position the targeted hotels to compete better in their respective markets, while enhancing long term performance.

Speaker 1: Building on the success of the Marriott's Transformational Capital Program, we believe these portfolio investments will position the targeted hotels to compete better in their respective markets while enhancing long-term performance.

Speaker 1: Hayat has agreed to provide us with priority returns on these investments.

Hyatt has agreed to provide us with priority returns on these investments. Additionally, Hyatt will provide $40 million and operating profit guarantees as protection for the anticipated disruption associated with the incremental investment.

Speaker 1: Our total investment is expected to be approximately $550 to $600 million. Two-thirds of which we were planning to invest is part of our capital plan over the next few years.

Our total investment is expected to be approximately $550 million to $600 million two thirds of which we were planning to invest as part of our capital plan over the next few years.

We expect to invest between 125 and $200 million per year over the next three to four years on this program.

Speaker 1: We expect to invest between $125 and $200 million for a year over the next three to four years on this program. We are targeting stabilized annual cash on cash returns and the low double digits on our Imperial embassies.

We're targeting stabilized annual cash on cash returns in the low double digits on our incremental investment.

Speaker 1: To a combination of enhanced owners' priority returns and Breptar Index share gain.

Through a combination of enhanced owners' priority returns and Revpar index share gains.

Speaker 1: Turning to our capital expenditure guidance for 2023, we tightened the range to $615 to $695 million, which includes approximately $200 to $230 million of investment for redevelopment, repositioning in ROI projects, and $150 to $175 million for hurricane restoration work.

Turning to our capital expenditure guidance for 2023, we tightened the range to $615 million to $695 million, which includes approximately $200 million to $230 million of investment for redevelopment repositioning and ROI projects and 150.

<unk> to $175 million for Hurricane restoration work.

Major capital expenditure projects include the December completion of a transformational renovation at the Fairmont Kea Lani as well as the start of construction at the Phoenician Canyon suites villas and the luxury condominium development at four seasons resort Orlando at Walt Disney World Resort.

Speaker 1: Major capital expenditure projects included the December completion of a transformational renovation at the Fairmont, Keyline, as well as the start of construction at the Phoenician Canyon, Sweet Svellas, and a luxury condominium development at poor season's resorts or landau at Walt Disney World Resort.

Speaker 1: Lastly, we are well underway with the repositioning renovation of the Hilton Singer Island, which is expected to be complete in the first quarter of 2024. And we are working with Hilton to stop brand the hotel as a Curio Collection Resort.

Lastly, we are well underway with our repositioning renovation of the Hilton singer Island, which is expected to be complete in the first quarter of 2024, and we are working with Hilton to soft brand the hotel as a curio collection resort.

Speaker 1: We are targeting a stabilized cash on cash return in the mid teams on our repositioning investments.

We are targeting a stabilized cash on cash return in the mid teens on our repositioning investments.

Speaker 1: As we have said many times before, our exceptional balance sheet puts us in a position to execute our multiple fronts, which is what you saw us do during the third quarter.

As we have said many times before our exceptional balance sheet puts us in a position to execute on multiple fronts, which is what you saw us do during the third quarter.

Speaker 1: We continue to reinvest in our portfolio and we believe our comprehensive renovations will enhance the even a growth of our portfolio well into the future.

We continue to reinvest in our portfolio and we believe our comprehensive renovations as well enhance the EBITDA growth of our portfolio well into the future.

We announced an exciting transformational capital program with Hyatt.

Speaker 1: We announced an exciting transformational capital program with Hayet repurchased approximately $100 million of stock and returned capital to shareholders through a 20% increase in our quarterly dividend.

We purchased approximately $100 million of stock and returned capital to shareholders through a 20% increase in our quarterly dividend. We continue to be optimistic about the state of travel and we believe host is very well positioned to outperform in the current economic environment.

Speaker 1: We continue to be optimistic about the state of travel and we believe host is very well positioned to outperform in the current economic environment. With that, I will turn to call over.

With that I will turn the call over to Rob.

Thank you Jim and good morning, everyone building on Jim's comments I will go into detail on our third quarter operations, our updated 2023 guidance, our balance sheet and our dividend.

Speaker 2: Thank you Jim and good morning everyone. Building on Jim comments, I will go into detail on our third quarter operations are updated 2023 guidance, our balance sheet and our dividends.

Speaker 2: Starting with business mix, we estimate that Maui impacted overall transient revenue by 450 basis points, which skewed the comparison to squatter, resulting in transient revenue down 330 basis points to the third quarter of 2022.

Starting with business mix, we estimate that Maui impacted overall transient revenue by 450 basis points, which skews. The comparison this quarter, resulting in transient revenue down 330 basis points to the third quarter of 2022.

We were encouraged that transient rates at resorts remained 56% higher than 2019, despite the impact from Maui and the renovation at the one hotel South Beach, which contributed to the decline over last year.

Speaker 2: We were encouraged that transient rates at resource remained 56% higher than 2019, despite the impact from Maui and the renovation at the one hotel South Beach, which contributed to the decline over last year.

Speaker 2: As expected, during the third quarter, we continue to see a normalization in transient rates at resorts compared to 2022.

As expected during the third quarter, we continued to see a normalization in transient rates at resorts compared to 2022.

Speaker 2: Business transient revenue was approximately 9% above the third quarter of 2022. Business transient room sold remained approximately 20% below 2019 level, but it's worth noting that New York, San Francisco, and Denver, three of our largest business transient markets were within 10% of 2019 room nights in the third quarter.

Business transient revenue was approximately 9% above the third quarter of 2022.

Business transient rooms sold remain approximately 20% below 2019 levels, but it's worth noting that in New York, San Francisco and Denver, three of our largest business transient markets within 10% of 2019 room nights in the third quarter.

Looking at top business transient customers.

Speaker 2: Looking at top business-trained customers, large consulting and audit firms continue to drive the biggest share of business travel room nights, but they're also the largest contributor to room night decline compared to 2019. Encouragingly, during the third quarter, large technology companies showed room night growth compared to 2019.

<unk> consulting and audit firms continue to drive the biggest share of business travel room nights.

There are also the largest contributor to room night declined compared to 2019.

Encouragingly during the third quarter with large technology companies showed room night growth compared to 2019.

Speaker 2: 22-BOOF, Blue-Proon revenues were 10% above the third order of 2022, driven by a rate increase of 8%.

Turning to group group room revenues were 10% above the third quarter of 2022, driven by a rate increase of 8%.

Speaker 2: It is worth noting that these results were skewed higher by the recovery and belief groups at our Maui resource, which positively impacted group room revenue.

It is worth noting that these results were skewed higher by the recovery and relief groups and our Maui resort, which positively impacted group room revenue.

In the quarter for the quarter group room night bookings were up 49% compared to last year and 85% compared to 2019 with growth driven by New York, Phoenix and San Francisco as a convention hotels continued to focus on building a strong in house group base.

Speaker 2: In the quarter for the quarter group room night bookings were up 49% compared to last year and 85% compared to 2019 with growth driven by New York, Phoenix and San Francisco as our convention hotels continue to focus on building a strong in-house group base.

Speaker 2: Now we also contributed to the strong in the quarter for the quarter bookings, but results would still have been up meaningfully excluding its contribution.

Maui also contributed to the strong in the quarter for the quarter bookings.

But results would still have been up meaningfully excluding its contribution.

Speaker 2: We are encouraged by the continued recovery of international arrivals San Francisco, which stood at 87% of 2019 levels in the third quarter, up from 76% in the fourth quarter, driven by increased air-left formation.

We are encouraged by the continued recovery of international arrivals, San Francisco, which stood at 87% of 2019 levels in the third quarter up from 76% in the fourth quarter driven by increased airlift from Asia.

With respect to group mix corporate group room revenue was up 8% in the third quarter, driven by 7% rate growth.

Speaker 2: With respect to group megs, corporate group room revenue was up 8% in the third quarter, driven by 7% wage growth.

Speaker 2: Association Group Revenue was down 11% in the third quarter compared to last year, led by a decline in room nights as the citywide recovery remains uneven.

Association Group revenue was down 11% in the third quarter compared to last year led by a decline in room nights.

Citywide recovery remains uneven.

Social military education, religious and for tunnel or Smurf group revenue was up 39% in the third quarter, driven by recovery and relief room nights on Maui, which are designated in the small category, excluding Maui room night growth in this category would still have been up over seven.

Speaker 2: Social, military, educational, religious, and fraternal, or Smurf Group revenue, was up 39% in the third quarter, driven by recovery and relief room nights on Maui, which are designated in the Smurf category. Excluding Maui, room night growth in this category, would still have been up over 7% led by a hotel in New York and Washington DC.

<unk> led by our hotels in New York, and Washington D C.

Speaker 2: Looking ahead, our 2024 total group revenue pace is 13% ahead of the same time last year. And we continue to be encouraged by the citywide booking pace in markets such as Seattle, New Orleans, and San Diego, all of which have citywide group room nights, meaningfully ahead of the same time last year.

Looking ahead, our 2024 total group revenue pace is 13% ahead of the same time last year and we continue to be encouraged by the citywide booking pace in markets, such as Seattle, New Orleans, and San Diego, all of which have citywide room nights meaningfully ahead of the same time last year.

Shifting gears to margin performance.

Speaker 2: Shifting gears to margin performance, our third quarter comparable hotel EBITDA margin came in at 26.6% which is 10 basis points above the third quarter of 2019.

Third quarter comparable hotel EBITDA margin came in at 26, 6%, which is 10 basis points above the third quarter of 2019.

Speaker 2: Total comparable expenses ruled 5.5% over 2019, while total comparable revenues were up 5.6%.

Total comparable expenses grew five 5% over 2019, while total comparable revenues were up five 6%.

Speaker 2: As we have said many times before, we are encouraged that comparable hotel EBITDA margins remains above 2019 despite elevated expense inflation over the past four years and occupancy still eight points below 2019.

As we have said many times before we are encouraged that comparable hotel EBITDA margin remains above 2019, despite elevated expense inflation over the past four years and occupancy is still eight points below 2019.

As Jim mentioned, despite the impact of the wildfires on Maui, we maintained the midpoint of our previous full year expected comparable hotel revpar growth at 8% and tightened our full year revpar growth guidance range to seven 5% to 875%.

Speaker 2: As Jim mentioned, despite the impact of the wildfires in Maui, we maintained the midpoint of our previous school year expected comparable hotel Ruff Park Road at 8% and tightened our full year Ruff Park Road guidance range to 7.25% to 8.75%.

Speaker 2: Our guidance range continues to contemplate varying degrees of moderating growth in the fourth quarter. We would expect you over your comparable hotel ref part presented changes in the fourth quarter to be down low single digits at the bottom end to up low single digits at the top end with the range driven primarily by the evolving nature of demand or amount.

Our guidance range continues to contemplate varying degrees of moderating growth in the fourth quarter, we would expect year over year comparable hotel revpar percentage changes in the fourth quarter to be down low single digits at the bottom end to up low single digits at the top end with the range driven primarily by the <unk>.

<unk> nature of demand on Maui.

Speaker 2: We expect fourth quarter operational results to roughly follow 2019 quarterly seasonal trends as provided on page 17 of our supplemental financial information, which at the midpoint of our guidance implies slightly positive fourth quarter ref program.

We expect fourth quarter operational results to roughly followed 2019 quarterly seasonal trends as provided on page 17 of our supplemental financial information, which at the midpoint of our guidance implies slightly positive fourth quarter Revpar growth.

Speaker 2: At the midpoint, we would expect full year adjuster EBITDA RE of $1,620 million.

At the midpoint, we would expect full year adjusted EBITDA.

Of $1 billion $620 million.

Speaker 2: Please note that our adjusted EBITDA RE guidance includes $54 million of business interruption proceeds, which we received in the third quarter, and an additional $26 million, which we expect to collect in the fourth quarter, all of which is related to Hurricane Ian.

Please note that our adjusted EBITDA guidance includes $54 million of business interruption proceeds, which we received in the third quarter and an additional $26 million, which we expect to collect in the fourth quarter all of which is related to hurricane Ian.

Speaker 2: excluding the impacts of business interruption are revised full-year comparable hotel EBITDA midpoint only declined $8 million versus the second quarter despite a full-year estimated impact of $25 million from now.

Excluding the impact of business interruption, our revised full year comparable hotel EBITDA midpoint, only declined $8 million versus the second quarter. Despite a full year estimated impact of $25 million from Maui.

It is important to remember that although business interruption proceeds are onetime in nature, we expect the Ritz Carlton Naples, and Hyatt Regency coconut point to contribute a full year of EBITDA in 2024.

Speaker 2: It is important to remember that although business interruption proceeds are one time in nature, we expect the risk-haulfinnaple and highest-regency coconut point to contribute a full year of EBITDA in 2024.

Speaker 2: As a reminder, comparable hotel EBITDA and comparable hotel EBITDA margin are not affected by operational results or business interruption proceeds related to these two results, as they are considered non comparable at this time.

As a reminder, comparable hotel EBITDA and comparable hotel EBITDA margin are not affected by operational results or business interruption proceeds related to these two resorts as they are considered non comparable at this time.

Speaker 2: Chifting to margins as we have discussed over the past few quarters. Year over year, we expect comparable hotel EBITDA margins to be down 210 basis points at the low end of our guidance to down 170 basis points at the high end due to.

Shifting to margins as.

As we have discussed over the past few quarters year over year, we expect comparable hotel EBITDA margins to be down 210 basis points at the low end of our guidance to down to 170 basis points at the high end due to.

Speaker 2: stable staffing level that are hotels, higher utility and insurance expenses, and lower attrition and cancellation fees.

Stable staffing levels at our hotels higher utility and insurance expenses and lower attrition and cancellation fees.

Speaker 2: For these reasons, we do not believe 2022 represents a stabilized comparison for margin.

For these reasons, we do not believe 2022 represents.

<unk> comparison for margins.

Relative to 2019, which we believe is a more representative year for margin comparison.

Speaker 2: Relative to 2019, which we believe is a more representative year for margin comparison. We expect margins this year to be up 20 basis points at the low end of our guidance to up 60 basis points at the high end. This margin expansion is despite impacts from Maui occupancy still meaningfully below 2019 levels, moderating attrition and cancellation revenues and expense inflation.

We expect margin this year to be up 20 basis points at the low end of our guidance to up 60 basis points at the high end.

This margin expansion is despite impacts from Maui occupancy still meaningfully below 2019 levels moderating attrition in cancellation revenue and expense inflation.

Speaker 2: Turning to our balance sheet and liquidity position, the $163 million loan to the buyer of the Sheridan Boston was repaid in full during the third quarter.

Turning to our balance sheet and liquidity position.

The $163 million loan to the buyer of the Sheraton Boston was repaid in full during the third quarter.

Speaker 2: Our weighted average maturity is 4.5 years at a weighted average interest rate of 4.6%.

Our weighted average maturity is four five years.

At a weighted average interest rate of four 6%.

Speaker 2: We have a balanced maturity schedule with our next maturity of $400 million coming due in April 2024.

We have a balanced maturity schedule with our next maturity of $400 million coming due in April 2024.

Speaker 2: We ended the third quarter at 2.1 times leverage and we have 2.6 billion dollars of total available liquidity, which includes 218 billion dollars of FSNE wizard and full availability of our 1.5 billion dollar credit facility.

We ended the third quarter at two one times leverage and we have $2 6 billion of total available liquidity.

Which includes $218 million of FSA reserves and full availability of our $1 5 billion credit facility.

In addition, we repurchased six 3 million shares at an average price of $15 90 per share, bringing our total repurchases for the quarter to $100 million.

Speaker 2: In addition, we repurchase 6.3 million shares at an average price of $15.90 per share, bringing our total repurchases for the quarter to $100 million.

Speaker 2: Here to date, we have repurchased 9.5 million shares at an average price of $15.82, bringing our total repurchases for the year to $150 million.

Year to date, we have repurchased nine 5 million shares at an average price of $15 82.

Bringing our total repurchases for the year to $150 million.

Speaker 2: We have approximately $823 million of remaining capacity under our repurchase program. And we will continue to be opportunistic when executing share repurchase.

We have approximately $823 million of remaining capacity under our repurchase program and we will continue to be opportunistic when executing share repurchases.

Speaker 2: We paid a quarterly cash dividend of 18 cents per share and increase of 3 cents or 20% over our second quarter dividend.

We paid a quarterly cash dividend of <unk> 18 per share an increase of <unk> or 20% over our second quarter dividend.

Though we expect to maintain our quarterly dividend at a sustainable level, taking into consideration potential macroeconomic factors all future dividends are subject to approval by the Companys board of directors.

Speaker 2: Though we expect to maintain a quarterly dividend at a sustainable level, taking into consideration potential macroeconomic factors, all future dividends are subject to a approval by the company's Board of Directors.

Speaker 2: We remain optimistic on the future of our business and travel overall. We believe our portfolio, our balance sheet, and our team are well positioned to continue out performing.

We remain optimistic on the future of.

Business and travel and overall, we believe our portfolio our balance sheet and our team are well positioned to continue outperforming <unk>.

Speaker 2: As we have shown, hosts can do it all, and we will continue to be strategic in the current macroeconomic environment.

As we have shown who else can do it all and we will continue to be strategic and the current macroeconomic environment.

Speaker 2: With that, we would be happy to take your questions. To ensure we have time to address as many questions as possible, please limit yourself to one question.

With that we would be happy to take your questions to ensure we have time to address as many questions as possible. Please limit yourself to one question.

Thank you at this time, we will be conducting our question and answer session. If you would like to ask a question. Please press star one on your telephone keypad.

Speaker 3: Thank you. At this time, we will be conducting our question and answer session. If you would like to ask a question, please press star one on your telephone key pass.

A confirmation tone will indicate your line is in the question queue you.

Speaker 3: A confirmation tone will indicate your line is in the question.

Speaker 3: You may press start if you would like to remove your questions.

You May press Star two if you would like to remove your question from the queue.

Speaker 3: And for participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment please. Whoa.

And for participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys.

One moment, please while we poll for questions.

Thank you.

Our first question is coming from Ari Klein with BMO your line of sight.

Speaker 3: Our first question is coming from Ari Klein with BML. Your line is...

Thanks, and good morning.

Speaker 4: Thanks, and good morning. Maybe just on the group bookings pace, it's up 13% for next year. curious what you're seeing from the end of quarter for the quarter bookings. And you see that book that bookings pace for next year ultimately narrows as maybe bookings booking windows extend. And then if you just touch on which markets look strongest and weakest for next year from a group standpoint.

Maybe just the on the group bookings pace, it's up 13% for next year curious what youre seeing from the end of the quarter for the quarter bookings.

And do you think that book that booking pace for next year, ultimately narrows as maybe bookings booking windows extend.

And then if you could just touch on which which market slump strongest to weakest for next year from a from a group standpoint.

Sure.

Speaker 2: So we're so meaningful in the quarter for the quarter of bookings for the third quarter. That trend seems to be pretty consistent. We actually picked up 85% more else in the 19 and Q3 in the quarter for the quarter. When we looked at the 245,000 group room nights that Jim spoke to that we picked up in Q3, 4Q3 and Q4, about 46% of that was a pickup for Q3. And about 54% of that was about

So we saw meaningful in the quarter for the quarter, our bookings for the third quarter.

That trend seems to be pretty consistent.

We actually picked up 85% more relative to <unk> 19 in Q3 in the quarter for the quarter.

When we looked at the 245000 group room nights that Jim spoke to that we picked up in Q3 for Q3 and Q4 about 46% of that was a pick up for Q3 and about 54% of that was about.

Speaker 2: Pick up for Q4. Going into next year, as the booking window extends, we do expect that to moderate somewhat, just because there wouldn't be any capacity left, frankly, at the hotel. So, to put that into perspective are in the court for the quarter booking window extended by about 10 days.

Pick up for Q4 going into next year as the booking window extend.

We do expect.

That to moderate somewhat just because there wouldn't be any capacity left frankly at the hotel so to put that into perspective in the quarter or for the quarter booking window extended by about 10 days.

Speaker 2: which effectively was, it was 80 days before and it's like 90 days now. And then all future rivals that extended by 15 days. So we definitely seeing that

Which effectively was 80 days before and if so like 90 days now and then all future arrivals that extended by 15 days. So we're definitely seeing that.

Speaker 2: That extend for in the year for the year as well as for future years. So you will see that moderation into next year.

That extend for in the year for the year as well as for future years.

So you will see that moderation into next year as it relates to market that we expect will do well.

Speaker 2: As it relates to markets that we expect will do well.

Speaker 2: For next year, we certainly seeing trends for upward followers, meaning for San Diego, Orlando, and DC. Overall, Citywide Pace for 2024 is strong in Seattle, Boston, New Orleans, and Miami as well. What's interesting is right now, when you look at 2024, the Citywide Room Night Pace is actually 90% of 2019 actual, which is up from 83% which we saw at the end of Q2.

For next year, we're certainly seeing a strength for our portfolio, that's meaningful that San Diego Orlando and <unk> overall citywide pace for 2024 is strong.

In Seattle Boston.

Arlen.

And Miami as well what's interesting is like now when you look at 2020 for the three way to citywide room nights cases actually 90% of 2019, actual which is up from 83%, which we saw at the end of Q2.

Thanks, I appreciate the color.

Thank you.

Speaker 3: Plan K. Our next question is coming from Michael Bellasario with Beard. Your line is sacrificed.

Our next question is coming from Michael Bellisario with Baird. Your line is life.

Thanks, Good morning, everyone.

Speaker 5: Just on the the high-end capital program for those 600 thousand maybe just on average, but when were they all last renovated? What's the current rev par penetration index? And then do you expect to get the same three to five point lift that you had underwrote for the Mara program? Thank you.

On the Hyatt capital program for those six hotels, maybe just on average, but when were they all last renovated.

What's the current Revpar penetration index and then do you expect to get the same three to five point lift that you had.

Under wrote for the Marriott program. Thank you.

Yes, Mike.

Speaker 1: Yeah, Mike, we'll be happy to gather that information specifically and share it with you. But suffice it to say that

We'll be happy to gather that information, specifically and share it with you.

But suffice it to say that.

We and Hyatt or both to lead that these properties were.

Speaker 1: We and Hyatt both believe that these properties were in need of a transformational comprehensive renovation. You know, we were going to undertake.

In need of a transformational comprehensive renovation.

We were going to undertake.

Speaker 1: work at all six of these hotels, about two thirds of the work that we agreed to with Hayet in return for the enhanced owner priorities and the $40 million guaranteed to support disruption. So we see returns in the...

Work at all six of these hotels.

About two thirds of the work that.

We agreed to with Hyatt.

In return for the enhanced owner priorities and the $40 million <unk>.

Guaranteed it to support.

Disruption.

So we see a.

Our returns in the.

Speaker 1: You know, the low teens, as we saw with the Marriott Transstructional Capital Program, and that will be driven by the enhanced owner priority as well as yield index gains. So I think that we have a very high degree of comfort given the performance of the assets in the Marriott Program and just to refresh your recollection that was 16 properties. They're not all...

The low teens.

As we saw with the.

Marriott transformational capital program and that will be driven by that.

The enhanced owners' priority as well as our.

Yield index gains so I think that we have a very high degree of comfort given the performance of the assets.

And the Marriott program that just to refresh your recollection that was 16 properties.

They're not all.

Speaker 1: Stabilized yet due to

Stabilized yet dot do too.

Where we are but due to certain properties and certain competitive sets like New York in particular, having been closed for a longer time.

Speaker 1: where we are but due to certain properties and certain competitors that's like New York, in particular having been closed for a longer time than our property. But the assets that we have seen have delivered.

Then our property, but the assets that we have seen have delivered.

Speaker 1: truly outsized yield index gains. We had underwritten three to five points and we're meaningfully about that. So we're excited to be able to partner with Hyatt as their largest owner.

Truly outsized.

Yield index gains we had underwritten three to five points were meaningfully above that so we're excited to be able to partner with Hyatt as their largest owner and rail.

Speaker 1: really looking forward to getting on with this program, which we will complete over the next three to four years.

Really looking forward to getting on with this program, which we will complete over the next three to four years.

Thank you. Our next question is coming from Bill Crow with Raymond James Your line is live.

Speaker 3: Thank you. Our next question is coming from Bill Krull with Raymond James. Your line is last.

Speaker 6: Thanks. Good morning, Jim Serov. Point of clarification, Serov, is it fair to say you still have about $40 million in potential BI recoveries that could occur next year, right, $250 million through the third quarter plus some of the fourth?

Thanks, Good morning, Jim throughout.

Point of clarification, Rob is it fair to say you still have about $40 million in potential recoveries that could occur next year.

$250 million through the third quarter plus some in the fourth.

Speaker 6: And then the gap to 310 is that right what I think about it?

And then the gap to 310 is the right way to think about it.

Speaker 2: Yeah, we still plan to get to the 310. We're working with our insurers right now. There will be an allocation between BI and property. So far.

Yes, we still plan to get to the 310, we're working with our insurance right now there will be an allocation between <unk> and property. So far what the letter we have got from our insurers that we will be they are okay with the $80 million of SDI. That's why we have $26 million of bi in our forecast.

Speaker 2: What the letter we have got from our insurers is that we will be, they're okay with the 80 million of BI. That's why we have 26 million of BI in our forecast.

Speaker 2: We are still working with the insurers to collect on the balance, don't know what that number exactly is going to be. It won't be all of the remaining to get to the free 10, but certainly more than the 80 million. So we do expect some behind next year, and that amount we are still working with our insurers as to what that is going to be.

We are still working with the insurers to collect on the balanced don't know what that number exactly but a bit.

It won't be <unk>.

All of the remaining to get to the <unk>, but certainly.

More than 80 million. So we do expect some beyond next year of that amount. We are still working with our insurers as to what that is going to be.

Alright, Thanks, and then my question really is.

Speaker 6: All right, thanks. And then my question really is, I hear you on the comparison of the margins versus 2019 instead of 2022. In a few months, we're gonna be talking about 24 versus 23. And I'm thinking, you know, the question I've been asking the number of the REITs is, what sort of top line growth will make our own decision about what that is? How much do you need before you could get flat EBITDA margins next year? Is that a, is that a 4%?

Sure.

The comparison on the margins versus 2019, instead of 2022 in a few months, we're gonna be talking about 24 versus 23 and I'm thinking the question I've been asking them a number of the Reits is what sort of top line growth and we'll make our own decision about what that is and how much do you need before you could get flat EBITDA.

Margins next year is that a is it a 4% number.

Speaker 1: Bill, that's the question is really difficult to answer given where we are with respect to the budgeting process. What I can share with you at this time is

That's the question is really difficult to answer given where we are with respect to the budgeting process.

What I can share with you at this time is.

We would anticipate wage growth next year.

Speaker 1: We would anticipate wage growth next year in the 45%.

In the 4% to 5% range.

Speaker 1: you know where it's not so you're going to come in there certainly baked through next June because that the renewal was that is year to year and every news June one of every year or July one of every year I guess

Where it <unk> cost you are going to come in there's certainly baked.

Through next June.

The renewal was that is year to year and it renews June one of every year. Our July one of every year I guess through June 30. So.

The question Mark will be what happens at insurance renewal.

Speaker 1: question mark will be what what happens that insurance renewal and you know there are a lot of variables that can impact that

There are a lot of variables that can impact that.

Speaker 1: And you know, as we get granular on each hotel budget, we will look for opportunities to continue to enhance improvements in productivity.

And as we get granular.

Each hotel budget, we will look for opportunities to continue to enhance improve.

Improvements in productivity add.

And utilize technology as we have been doing so we will do everything possible to come.

Speaker 1: and utilize technology as we have been doing. So we will do everything possible to command and control expenses going forward.

Command and.

Control expenses going forward.

Speaker 1: But I do think it's important that we kind of level set.

I do think it's.

It is important that we kind of level set.

Speaker 1: the stage as to what?

The stage as to what.

Speaker 1: is our true base of EBITDA going into next year. And I would like to just share a couple numbers with you because I don't want people to think that, you know, the $80 million.

Our true base of EBITDA.

Going into next year, and I would like to just.

Sure a couple of numbers.

With you.

I don't want people to think that the $80 million of business interruption that we received this year as a onetime event.

Speaker 1: of business interruption that we received this year as a one-time event. It's really not a one-time event. From the perspective that.

It's really not a onetime event from the perspective that the Ritz Carlton Naples, and the Hyatt Regency coconut point are going to be back online full time next year.

Speaker 1: The Ritz Carlton Naples and the High Recessy Coat that I'm playing are going to be back online full time next year. So. So.

Sure.

Speaker 2: Yeah, just to expand on that bill, I think the way to think about it first to level up at the base of before we even get into the growth

Yeah, just to expand on that Bill I think the way to think about exports to the levels at the base before we even get into the growth of EBITDA for next year. When you think about the midpoint of our guidance at 16 20, right now that already has a $30 million negative impact from Maui, which it is made up of 25.

Speaker 2: of EBITDA for next year, when you think about the midpoint of our guidance at 1620 right now, that already has a $30 million negative impact from Maui, which is made up of 25 million from the hotels and then 5 million from the timeshare. So let's assume for a second that we still have about a similar impact into next year at Maui recovers.

$5 million from the hotels and then five months on the timeshare. So let's assume for a second that we still have about a similar impact into next year at Maui recovers.

Speaker 2: And then you think about that 80 million of BI that proceeds for this year with Jim mentioned, that effectively majority of that we would have received as EBITDA from the risk of the Naples and the high hookered point if it was not for Hurricane Ian. So that is EBITDA we would be receiving for next year. And in other words, if you think about it, the base before any growth is starting off at a billion six plus.

And then you think about that $80 million of debt.

Proceeds for this year, what Jim mentioned does that effectively majority of that we would have received as EBITDA from the Ritz Carlton Naples, and the Hyatt coconut point, if it was not for hurricane in so that is EBITDA, we would be receiving for next year. So in other words, if you think about it.

Before any growth.

Is starting off at $1 six plus if that makes sense.

Speaker 2: And then of course, as Jim mentioned, in terms of expenses and everything else, we are working through and we have many initiatives that we are working on. So while there will be inflationary expense pressures, we fully anticipate to mitigate those pressures with productivity enhancements and various initiatives that we have going on at the hotel. And we will provide you with next year guidance as we typically do in February , at the February call.

And then of course as Jim mentioned in terms of expenses and everything else. We are working through and we have many initiatives that we're working on so while there will be inflationary expense crashes, we fully anticipate to mitigate those.

Those pressures with productivity enhancements and various initiatives that we have going on at the hotels and we will provide you with next.

Next year guidance as we typically do in February at the February call.

Great. Thank you guys.

Speaker 3: Thank you. Our next question is coming from Duane Feningworth with Evercore ISI. Your line is lies. Hey, thanks. Good morning.

Thank you. Our next question is coming from Duane <unk> with Evercore ISI. Your line is life.

Hey, Thanks, Good morning, I thought that was a good.

Question by Bill and in response by you.

Speaker 7: question by bill and and response by you uh... so um... i'll just i'll just ask another hawaii question uh... maybe um... could you just play back the recovery uh... why things were a little bit better than you anticipated uh... in the third quarter and then maybe just since since the delta on the fourth quarter guidance is is really about how i it sounds like what what would get you to the high-end what would get you to the low-end in terms of what needs to happen

I'll just I'll just ask another Hawaii question maybe.

Maybe.

Could you just play back the recovery why things were a little bit better than you anticipated.

In the third quarter, and then maybe just since since the Delta.

Delta on the fourth quarter guidance is really about Hawaii. It sounds like what what would get you to the high end what would get you to the low end in terms of what needs to happen.

Sure Duane.

Speaker 1: Sure, Julian. You know, let me start by saying that the word and not promowee, I think our guidance range for the pool year would have been tighter than it is. But we...

Let me start by saying that the were it not for Maui I think our guidance range for the full year would have been tighter than it is but we we have a wide range at this at this point in time because of some of the uncertainties surrounding how Hawaii is how he is going to recover.

Speaker 1: We have a wide range at this point in time because of some of the uncertainties surrounding, how is Maui going to recover? You know, the west side of Maui, kind of poly, just reopened to tourist on November 1st yesterday. So it's gonna take some time to see the cadence of

The west side of Maui kind of poly just reopened to tourist on November 1st yesterday. So.

It's going to take some time to see the cadence of.

Speaker 1: how people are going to come back to the west side. And I do believe it will take some time as well for people to get comfortable, re-booking their stays down in the wild area where our other two resorts are. We did see a lot of cancellations.

Our people are going to come back.

To the west side and I do believe it will take some time as well.

For people too.

Get comfortable are rebooking their stays down in the wireless area, where our other two resorts are we did see a lot of cancellations.

Speaker 1: in the fourth quarter due to some pronouncements that were made by the governor, and we fully support the reconstruction and relief efforts because what happened on my list is a terrible horrible disaster. And we...

In the fourth quarter.

Due to some pronouncements that were made by the governor and we fully support the reconstruction and relief efforts because what happened on Maui is just a terrible horrible disaster and.

We fully support the fact that you've got to take care of the people first and that's what's happened.

Speaker 1: Fully support the fact that you've got to take care of the people 1st and that's what's happened. So, the reason that our performance in the 3rd quarter was better than we initially anticipated is. As a result of.

The reason that our performance in the third quarter was better than we initially anticipated.

As a result of <unk>.

Recovery.

Speaker 1: Recovery first responders taking rooms at our property as well as providing housing that was subsidized by FEMA for displaced residents. And that really caused a material pick up, a pickup better than we anticipated. You did see a decline in tread par in the quarter by...

First responders, taking rooms at our property as well as <unk>.

Providing housing that was subsidized by FEMA we're.

Were displaced residents.

<unk>.

That really caused a material pick up pick up better than we anticipated.

You did see a decline in trip par in the quarter by.

Speaker 1: an amount that was directly attributable to what happened on Maui, I think.

An amount that was directly attributable to what happened on Maui I think.

Speaker 1: The Outer Room spend, the TREADPAR spend, was impacted by 120 basis points.

The out of room spend that <unk> spend was impacted by a 120 basis points. So we're optimistic for the long term future of Maui, It's a great place and.

Speaker 1: So we're optimistic for the long term future, Molly. It's a great place. And...

Speaker 1: great place to be and you know we will do what we can to support the recovery.

Great place to be and we.

We will do what we can to support the recovery.

Speaker 7: Thanks, Jim. Maybe just to put a finer point on it, the Delta in the fourth quarter, the range, is that a function of the duration of first responder and housing or the rate of just sort of organic leisure recovery?

Thanks, John maybe just to put a finer point on it the delta in the fourth quarter. The range is that a function of the duration of first responder in housing or the rate of just sort of organic leisure recovery.

Speaker 2: Yeah, it's a little difficult to look at November and December . It really is a disaster recovery business and how that will taper off as the west side of the island opens up, which actually opened up as of yesterday, November 1st.

Yeah, it's a little difficult to look at November and December It really is a disaster recovery business and how that will taper off as the west side of the island opened up with actually opened up as of yesterday November 1st.

Speaker 2: So, it's, you know, we're trying to gauge, the properties are trying to gauge what that demand pickup looks like and how they will replace sort of the regular business with the demand recovery business. So, that was driving the delta. What I will say is if it was not for that, the Maui impact, you know, we put out October numbers at 2.4 percent. Our fourth quarter numbers would have been slightly higher than the 2.4 percent if it wasn't for the Maui impact.

It's we're trying to gauge the property the product gauge of what that demand pick up looks like and how they are all over the place sort of the regular business with the demand recovery business.

That was driving the Delta what I will say is if it was not.

For that the Maui impact even if.

If you put out October numbers at two 4% our fourth quarter numbers would have been slightly higher than the two 4% if it wasn't for.

OE impact.

Yes.

Speaker 1: Yeah, it point the fact just to kind of wrap this up. Wait, are anticipated, the anticipated impact on comparable hotel they're adorable facial highlight types.

Just to kind of wrap this up.

Our anticipated.

The anticipated impact on comparable hotel revpar.

Speaker 1: and comparable hotel EBITDA from Mali is 50 basis points.

And comparable hotel EBITDA from Maui is 50 basis points.

Speaker 1: off the top line and $25 million for the full year at the bottom line. So in essence, had Molly not occurred, we would have been talking about a guidance raise on this call because we were able to keep the midpoint at 8% we would have been talking about an 8.5% guide for this year. Thank you.

Off the top line.

And $25 million for the full year at the bottom line. So <unk> had Maui not occurred we would have been talking about a guidance raise on this call.

Because we were able to keep the midpoint at 8%, we would've been talking about an eight 5%.

Our guide for this year.

Understood. Thank you.

Thank you. Our next question is coming from Jay Kornreich with Wedbush Your line is life.

Speaker 3: Thank you. Our next question is coming from Jay Kornraig with Wendbush. Your line is

Speaker 8: Hey, good morning. You know, you made some comments on the urban and business trends and demand profile accelerating and September getting back to 70, a 17% gap to 2019. so I'm wondering if you can just provide some more color on how much you think that gap can narrow in 2024 and maybe within that, you know, some of your peers have been diminishing their exposure to San Francisco, maybe if you could provide some color and how you see your assets in that market trend over the next year or two.

Hey, good morning.

You've made some comments on the urban business transient demand profile accelerating and September getting doctors 70, 17% cap to 2019. So I'm wondering if you could just provide some more color on how much you think that gap to narrow in 2024 and maybe within that.

Your peers have been diminishing their exposure to San Francisco, maybe just provide some color on how you see your assets in that market trending over the next year or two.

Sure I'll take the San Francisco piece of it Jay and then <unk>.

Speaker 1: Sure. I'll take the San Francisco piece of it, Jay, and then, you know, Saurabh can talk a bit about business transients.

Rob can talk a bit about.

Business transient.

Speaker 1: You know, San Francisco, we think for the long term is a great place to be, particularly given the assets that we own, which we believe are the best located in the market and.

San Francisco.

We think for the long term is a great place to be particularly given the assets that we own which we believe are.

The best located in the market.

And.

Speaker 1: and excellent physical condition. The San Francisco, Moscone Marriott has been, for quite some time now, building a solid base of in-house group business. It's in terrific condition. It was the first asset that we completed as part of the Marriott's transformational capital program completed in 2019.

Excellent physical condition.

San Francisco Moscone Marriott has been.

For quite some time now.

Building, a solid base of in House group business.

If it is in terrific condition. It was the first asset that we completed as part of the Marriott transformational capital program.

Completed in 2019.

Speaker 1: And you know the results are paying off relative to the competitive set it is it is outpacing. I think everyone in the set today. The grand hide on you you swear also on great physical condition and a great location. So you know we are seeing a return of business travel in San Francisco in particular. In September .

And.

The results are paying off relative to the competitive set it is it is outpacing.

Think everyone is set today.

Grant Hyatt on Union Square also great physical condition and a great location. So.

We are seeing.

A return of business travel in San Francisco in particular.

In September.

Speaker 1: San Francisco, and it's one of our top business travel markets, we're down just about 10% in total room nights relative to where we were in 2019. So, it's slow and steady, and I think, you know, 2024 will be a challenge year for San Francisco from a citywide perspective. But as we get beyond 2024, we're optimistic about how the market is going to evolve.

San Francisco and it's one of our top business travel.

Markets.

We're down just about 10% in total room nights relative to where we were in 2019, so it's slow and steady and I think 2024 will be a challenge year for San Francisco from a citywide perspective, but.

As we get beyond 2024, we're optimistic about how the market is going to evolve.

Speaker 2: Yeah, and I'll add on the San Francisco piece, which is encouraging, is our lead volume at the San Francisco Merit Marquee is actually up 5.5% to last year.

Yes, I'll add on the San Francisco piece are most as encouraging as our lead volume.

At the San Francisco Marriott, Marquis is actually up.

The five 5% to last year and Calgroup right our room nights there was.

Speaker 2: And, you know, got group rights, room rights there was up almost eight and a half percent year over year as well. So and in November is, I believe, when APEC, that Asia-Pacific Economic Conferences, and that should be really good for San Francisco as well.

Almost 85% year over year as well so I'll add in November if they believe in APAC or Asia Pacific Economic conference isn't that should be really good for Samsung as well.

Speaker 2: Obviously 24 as Jim mentioned the citywide are weak, but that's why we are really making a inserted effort to get quality in house group at that hotel.

August 24, as Jim mentioned the city Wides.

Our week, but that's why we are really making up.

Sort of effort to get quality in house group at that hotel.

Speaker 2: I'm as it relates to your question on BT, it's been a very, very slow recovery from a room night perspective. Obviously we had the strength of the special corporate rate this year.

As it relates to your question on <unk>.

It's been a very very slow recovery from a room night perspective, obviously, we have the strength of the special corporate rates this year.

Speaker 2: almost double digits, but the room light recovery is

Almost double digit, but the room night recovery across the board for the portfolio still down around 20% call. It that said the major markets as we spoke about in our prepared remarks, San Francisco, New York, Denver down only 10% to 19, which is pretty impressive in terms.

Speaker 2: across the board for the Ford Fawio still down around 20% call it.

Speaker 2: That said, the major markets, as we spoke about in our prepared remarks, San Francisco, New York, Denver is down only 10% to 19, which is pretty impressive.

Speaker 2: In terms of 2024, we expect more of the same in terms of BT. We expect certain markets to recover, to continue recover, but just at a very slow pace. The reality is, is BT will come back in a meaningful way when there is more macroeconomic certainty and there is two economic growth. We believe there's a pretty close relation with non-residential fixed investment growth and red part and what is that?

2024, we expect more of the same in terms of BT, we expect certain markets.

To recover to continue recover but just at a very slow pace. The reality is is we will come back in a meaningful way when there is more macroeconomic uncertainty and there is two economic growth.

Believe there's a pretty close relation with nonresidential fixed investment growth and Revpar and ones that comes back in a meaningful way and GDP growth comes back in a meaningful way we expect.

Speaker 2: comes back in a meaningful way and GDP girls comes back in a meaningful way. We expect that gap to reduce.

That gap to reduce.

All very helpful. Thank you very much.

Speaker 3: Thank you. Our next question is coming from Smeed's Rose with Fisi. Your line is live.

Thank you. Our next question is coming from Smedes Rose with Citi. Your line is live.

Speaker 9: Hi, thanks. I can sort of ask you. You mentioned 2.6 million group roommates on the books for next year. How does that compare to where you would normally be in terms of group looking for the full calendar year when you're in the just lately year?

Hi, Thanks, I just wanted to ask you you mentioned $2 6 million.

Group room nights on the books for next year.

How does that compare to where you would sort of normally be in terms of group bookings for the.

For calendar year when you're in.

Uh huh.

This late in the year.

Yeah, when we compare that to 2019 were about 10% down relative to 2019.

Speaker 2: Yeah, when we compare that to 2019, we are about 10% down relative to 2019.

Okay. Okay. So catching up and then can you just mentioned.

Speaker 9: Okay, so catching up. And then can you take that out and have me mention, the Sheraton Boston, you mentioned the cellophonance that loan was repeated full, any update on the Sheraton Times Square loan.

You mentioned.

The Sheraton Boston you mentioned, the silicon that loan was repaid in full any update on the Sheraton times square loan.

Yeah that loan was due to be paid off on October 18.

Speaker 1: Yeah, that loan was due to be paid off on October 18th. We worked with the borrower and ended into a orbearance agreement and extension to November the next

We worked with the borrower and.

Entered into a forbearance agreement.

And extension to November the <unk>.

Speaker 1: November 8th, next Wednesday. As part of that agreement, the interest rate was restated to 13%, and there was an upfront depage that brought the effective rate all into 15%. So they are in the final stages of...

November date next Wednesday.

Part of that agreement.

The interest rate was restated to 13% and there was an upfront.

He paid that.

That brought the effective rate are all into a 15%. So they are in the final stages of.

Completing the documentation necessary.

Speaker 1: completed documentation necessary to have the loan paid off by next Wednesday.

To have.

The loan paid off by next Wednesday.

Great. Thank you.

Thank you. Our next question is coming from Dori Kesten with Wells Fargo. Your line is life.

Speaker 3: Thank you. Our next question is coming from Dory Kestin with Wells Fargo. Your line is

Speaker 10: Thanks morning, based on what you're seeing marketed for sale today, and then the shadow pipeline of deals you hear about, would you expect to be a net buyer next year?

Thanks, Good morning.

Kind of what Youre skiing marketing for sale today and in the Shadow pipeline beyond what you hear about when you expect to be a net buyer.

Dori I sure hope so.

I really do I mean, clearly our balance sheet.

Speaker 1: is a differentiating factor for hosts. As we've said, we have the ability to allocate capital across many fronts, as you saw us do in the third quarter, in sitting here at 2.1 times leverage.

As a differentiating factor for host.

We've said we.

We have the ability to allocate capital across many fronts.

As you saw us.

Two in the third quarter.

Sitting here at two one times leverage.

Speaker 1: and the ability to do deals all cash and get them done quickly. It's something that I don't think there's anyone else in this market can do today. What we're seeing today though, is still a fairly significant bid-ass spread in the marketplace.

And the ability to do do deals all cash.

And you can get them done quickly.

It's something that I don't think there's anyone else in this market can do today.

What we're seeing today, though is still a fairly significant bid ask spreads in the marketplace.

Speaker 1: There just isn't a lot of quality product.

There just isn't a lot of quality product.

And the pipeline.

Speaker 1: In the pipeline, we are talking to a lot of people, a lot of hotel owners, and we'll just have to wait and see.

We're talking to a lot of people.

A lot of hotel owners, and we'll just have to wait and see.

Speaker 1: how pricing trends as we get into 2024. But we clearly have the capability to not only continue to buy back stock, which we believe is very undervalued relative to our assets and the quality of our EBITDA and invest in our assets and pay a sustainable dividend and also be equititive.

How pricing trends as we get into 2024.

But we clearly have the capability to not only continue to.

Buy back stock, which we believe is a very undervalued relative to our assets and the quality of our EBITDA.

And invest in our assets and pay a sustainable dividend and also.

Be acquisitive.

Speaker 1: So let's keep our fingers crossed that we have an opportunity next year to do that. So let's keep our fingers crossed that we have an opportunity next year to do that.

So, let's yes, let's keep our fingers crossed that we have an opportunity next year to do that.

Okay. Thank you.

Thank you.

Speaker 3: Our next question is coming from Meredith Jensen, which HSBC, your line is...

Our next question is coming from Meredith Jensen, which H SBC your line of sight.

Yeah. Thank you I have two quick questions firstly looking at too that par or a couple of whole team at par if you could speak a little bit about what youre seeing in out of room spend and how we might think about that in the near and longer term and then secondly, I recall a couple of months ago, maybe at the analyst meeting.

Speaker 11: Yes, thank you. I have two quick questions. First, looking at T-REVPAR or comparable T-REVPAR, if you could speak a little bit about what you're seeing on out-of-room spend and how we might think about that.

Speaker 11: in the nearer and longer term. And then, secondly, I recall a couple months ago, maybe at the analyst meeting, you spoke about some strategic moves you might make over time working with managers to identify some of the brand standards that might be modified as you, you know, sort of collect some sample sets to.

You spoke about some strategic moves you might make other time working with managers to identify some of the brand standards that may be modified on as you sort of collect some sample sets.

Two.

Speaker 11: to drill down on those. And given where cost pressures are, I was curious if there's anything meaningful there we could think about. Thanks very much.

Down on those and given where cost pressures are I was curious if there's anything meaningful there. Okay. We can think about them. Thank you very much.

Sure.

Speaker 2: Sure, on the food and beverage front, bankering catering contribution, which is effectively bankering catering and AV revenue on a pro group right, room like basis still remains pretty strong. I mean, last quarter, we just had a lot of pent up group demands from

<unk> beverage front banquet and catering contribution, which is effectively banquet and catering revenue on a per group room night basis still remains pretty strong I mean last quarter, we just had.

A lot of pent up group demand from.

Speaker 2: groups that are canceled during COVID. So it's very difficult to compare the Q3 results to Q3 results of this year when it comes to food and beverage just because the excess amount of group that we had. So even if I internal forecast without the impact of the malware, we were actually expecting food and beverage revenues to be down. That said,

Groups that are canceled during COVID-19.

It is very difficult compared to Q3 results to Q3 results of this year when it comes to food and beverage just because the excess amount of group that we had so even in our internal forecast without the impact of Maui view, we're actually expecting food and beverage revenues to be down that said.

<unk>.

Speaker 2: That really has moderated in terms of food and beverage revenue. We are still getting a meaningful amount of banquet and catering contribution, and outlet revenues or the per occupied room are significantly higher than they were back in 2019.

That really has moderated in terms of food and beverage revenue there.

Still getting meaningful amount of banquet and catering contribution and.

Outlet revenues on a per occupied room are significantly higher than they were back in 2019.

Speaker 2: The piece that is certainly going to moderate as we get into next year is the Tritian and cancellation revenue.

The piece that is certainly going to moderate as we get into next year is attrition in cancellation revenue right that had you saw had an impact.

Speaker 2: Right, you saw an impact in the third quarter, third quarter with ANC revenue being down literally about half of what it was last year.

In the third quarter third quarter with and see revenue being down.

Literally about half of what it was last year, so that in putting into perspective in 2022 received close to $100 million of attrition cancellation revenue. We think that's been a moderate somewhere around the $50 million to $55 million range. So that's just one thing to keep.

Speaker 2: So that in putting the perspective in 2022 received close to $100 million of the Christian cancellation revenue. We think that's going to moderate somewhere on the 50 to 55 million range. That's just one thing to keep look out on. I'm sorry.

Look out on.

I'm sorry, your second question was.

Speaker 11: Just sort of, it was a sort of strategic question on working with managers on brand standards. Is there any modifications that could be made over time, you know, looking post-COVID?

Just started.

It was a sort of a strategic question on working with managers on brand standards and is there any modifications that could be made over time on.

Looking post COVID-19.

Well, we are constantly working with our managers to evaluate brand standards that are relevant.

Speaker 2: We are constantly working with our managers to evaluate brand standards that are relevant and frankly, I would say Marriott and Hyatt both.

And frankly no.

Particularly I would say Marriott and Hyatt.

Speaker 2: made meaningful changes for the brand standards post-pandemic.

Made meaningful changes into them.

Our brand for the brand standards post pandemic.

Speaker 2: really figuring out which ones we should modify, which ones to eliminate, the ones which truly drive value to the guess. It's always a continuing conversation.

Really figuring out which ones, we should modify which wants to eliminate the ones, which truly drive value to the guest it's always a continuing conversation.

Speaker 2: And we believe as technologies evolve and we can leverage technologies, which not only help from a productivity standpoint, but also enhance customer experience.

And we believe as technologies evolve and we can leverage technologies, which not only helped from a productivity standpoint.

But also enhance customer experience.

We will keep on doing proof of concepts and piloting those technologies to drive incremental value to the bottom line.

Speaker 2: keep on doing proof of concepts and piloting those technologies to drive incremental value to the bottom line.

Thank you.

Thank you.

Speaker 3: Thank you. Our next question is coming from Tyler Batori with Oppenheimer. Your line is live.

Our next question is coming from tighter Batori with Oppenheimer. Your line is life.

Thank you and good morning, everyone. A few questions on the leisure and resort commentary are you seeing any divergence within your portfolio between some of the higher rated resort properties and those that are a little bit lower at a different price points.

Speaker 12: Thank you. Good morning, everyone. A few questions on the leisure and the resort commentary. Are you seeing any divergence within your portfolio between some of the higher rated resort properties and those that are a little bit lower or at a different price point?

Speaker 12: And then when you look at the holidays, talk about your book position. I know it's still a little early there, but curious kind of what you're seeing in terms of demand Thanksgiving and Christmas. And then, you know, the third part of this question, you know, you talked about transient resort rates still 56% above 2019. You know, what sort of guideposts or what sort of expectations do you have for those rates?

And then when you look at the holidays I'm talking about your your booked position in a still a little early there.

But curious kind of what youre seeing in terms of demand Thanksgiving and Christmas and then the third part of this question you're talking about transient resort rate, so 56% above 2019.

You know, what what sort of guidepost or what sort of expectations do you have for those rates.

Speaker 12: you know, Q4 and kind of going forward, certainly commentary and the expectation is that that number should slow, but just trying to get a sense of, you know, best guess, perhaps, you know, how much, where growth could end up going in the next couple of quarters.

Q4, and kind of going forward, certainly commentary and the expectation is that that number should should slow, but just trying to get a sense of your best guess, perhaps.

How much.

Where growth could end up growing.

The next couple of quarters here.

Speaker 1: Sure, let me start with the last question that you asked with respect to leisure transient rates.

Sure Let me, let me start with that.

The last question that you asked with respect to leisure transient rates.

Speaker 1: We're very happy that in the 3rd quarter, our leisure transient rates were 56% above where they were in the 3rd quarter of 2019. For reference, that's down about 5 percentage points from where we were in the 2nd quarter. We were 2nd quarter. We were 61% ahead. And, you know, the fact that.

We're very happy there.

And third in the third quarter.

Leisure transient rates.

56% above where they were in the third quarter of 2019.

For reference that's down about five percentage points from where we were in the second quarter. We were in second quarter, we were 61% ahead.

And the fact that.

Speaker 1: that the 56% number takes into account the three comparable resorts on Mali to the negative. And it excludes our risk-heralds and naples and our higher-reasonry-seek-cognitive point does give us a substantial level of comfort that

The 56% number it takes into account the three comparable resorts on Maui.

To the negative.

And it excludes our Ritz Carlton Naples, and our Hyatt Regency coconut point does give us a substantial level of comfort that.

Speaker 1: Our properties are going to continue to be able to

Our properties are going to continue to be able to.

Charge a rate that customers are willing to pay.

Speaker 1: charge a rate that customers are willing to pay, just given the nature of the assets that we own. So we're not really seeing a divergence across the 16 resorts we have. They're all very high quality properties. And we're optimistic that as we get into the fourth quarter and as we get into next year, we'll continue to be able to drive.

Just given the nature of the assets that we own so we're not really seeing.

A divergence across the 16 resorts, we have they're all very high quality properties.

And we're optimistic that.

As we get into the fourth quarter and as we get into next year, we will continue to be able to drive.

Speaker 1: strong performance at all these assets. I think the Ritz Naples, what we're seeing with respect to booking pace across every room category at that property is very, very impressive and we're very optimistic that we're going to be able to

Strong performance at all of these assets I think that the rich Naples, what we're seeing with respect to.

Booking pace across every room category at that property.

Is very very impressive and we're very optimistic that we're going to be able to.

Speaker 1: I'll perform our underwriting expectations on the expansion of the Vanderbilt Tower. I think we underwrote 12 percent cash on cash return on that investment, and we're going to do much better going forward. So we are not seeing any signs of weakness as we move into the holiday season. You know, I would just I would just caveat that by saying, but for the unknown surrounding what's going to happen in Mali this year.

Outperform our underwriting expectations on the expansion of the Vanderbilt Tower, I think we underwrote a 12% cash on cash return.

On that investment and we're going to do much better going forward. So we are not seeing any signs of weakness as we move into the holiday season.

I would just I would just caveat that by saying, but for the unknowns surrounding whats going to happen in Maui This year.

And on the question of holidays, and how things are pacing.

Speaker 9: And on the question of holidays and how things are pacing, you have to keep in mind Q4 holidays somewhat present a tough comp to last year because last year was the first time the country was really open for broader travel during the holiday season.

When you have to keep in mind Q4 holidays somewhat present.

A tough comp to last year, because last year was the first time the country was really opened for broader travel during the holiday season.

Speaker 2: But that said, specifically for like a Christmas time right now, and this is much more directional where we have a revenue on the books, let's Maui is effectively flat, which we think is very encouraging. And for Thanksgiving, it's slightly off, but you have to remember it's.

But that said specifically for like a Christmas time, right now and this is much more direction of what we have.

Revenue on the books.

Let's Maui is effectively flat, which we think is very encouraging and for Thanksgiving, it's slightly off but you have to remember.

Speaker 2: that timing was a tough timing when you compare to last year. So we were off, less how Maui, down about 6, 7%.

That timing was a tough timing when you compare to last year. So we are off and that's how our Maui down.

Down about six 7%.

And pace, but.

Speaker 2: Christmas is effectively flat right now, facing flat in terms of revenue.

Christmas is effectively flat right now pacing flat in terms of revenue.

Speaker 3: Thank you. Our next question is coming from Anthony Powell with Barclays. Your line is

Thank you. Our next question is coming from Anthony Powell with Barclays. Your line is life.

Speaker 7: Hi, good morning. It's a question on one of your newer markets, Austin, Texas, rep parts been down in the past few quarters. Is that all technology business travel being down? And just more broadly? I think there's a convention center renovation there starting next year. Will that be disruptive? And how's your experience been in that market relative to kind of the more traditional coastal business urban market?

Hi, Good morning, I guess a question on one of your newer markets Austin, Texas Revpar has been down in the past few quarters is that all technology business travel being down and just more broadly I mean, there's a convention center renovation there starting next year, well that'd be disruptive and how's your experience been in that market relative to kind of the more traditional <unk>.

Stool.

This urban markets.

Speaker 1: I, Anthony, I think that, you know, Austin, we have 2 properties in Austin. We have the hotel bands and we have the higher agency. Austin, just to remind you, the higher agency was the. The 1st asset that we purchased.

Anthony I think that.

And we have two properties in Austin, we had the hotel vans at and we have the Hyatt Regency Austin.

Just to remind you the Hyatt regency was the the.

The first asset that we are.

Purchased.

Speaker 1: During the pandemic, I think it was the 1st hotel hotel deal that was done during the pandemic. And that asset is doing actually quite well. A van is, and it's doing quite well, given the fact that we're able to take in house group, given the meeting space platform there as well as its location across the lake.

During the pandemic I think it was the first hotel hotel deal that was done during the pandemic in that.

That asset is doing actually quite.

Quite well.

<unk> is.

And it's doing quite well given the fact that we were able to take in house group given the meeting space platform there.

As well as its location across the lake.

Speaker 1: Van Zandt is more of a leisure driven property, and I don't know if you've been to Austin recently, but there is an incredible amount of construction.

<unk> is more of a leisure driven property and I don't know if you've been to Austin recently.

But there is an incredible amount of construction around the vans and in that particular sub market. The Rainey Street district and that has really.

Speaker 1: around the Van Van in that particular sub market, the rainy street district.

Speaker 1: And that has really impacted.

Impacted.

Speaker 1: business at that property. So for the long term, I think it's going to be great going forward because it's a, a new development is occurring there, you know, residential as well as office.

Business at that property so for the long term I think it's gonna be great.

Going forward, because it's a myriad of.

New development is occurring there.

Residential as well as office.

Speaker 1: But in the short term, it's going to be challenging until we get the cranes out of there and the streets open up to business again. So, and tech has had a bit of an impact as well in the near term on that asset. So, you're absolutely right. With respect to, you know, plans for the Convention Center, hosts as well as other hotel owners who have a presence in Austin have been meeting.

In the short term.

It's going to be challenging.

Until we get the cranes are out of there and the streets open up to business again, so and tech has had a bit of an impact as well in the near term on that asset. So you are absolutely right with respect to plans for the Convention Center.

Host as well as other hotel owners, who have a presence in Austin have been meeting.

Speaker 1: with the appropriate officials in Austin to talk about...

With the appropriate officials in.

In Austin.

To talk about.

Speaker 1: Uh, whether or not, uh, you know, they're going to go forward with a closure of the convention center. Uh, or a staged, uh, uh, renovation and expansion and, uh, also talking about ways that. That we can mitigate any impact that, uh, actions taken with the convention center can. Uh, we'll have on business in the Austin market, so we're being proactive and, uh. Doing everything that we can do.

Whether or not.

They're going to go forward with a closure of the Convention center.

Or a staged.

Renovation and expansion and also talking about ways that we can mitigate any impact that the actions taken with the convention center can.

We will have on business in the Austin market, So we're being proactive and.

Doing everything that we can do.

No.

Speaker 1: to mitigate any potential issues surrounding the convention center going forward.

To mitigate any potential issues surrounding the conventional center going forward.

Okay. Thank you for that.

Okay.

Thank you our.

Speaker 3: Our final question today will be coming from Chris Boronka with Deutsche Bank. Your line is live.

Our final question today will be coming from Chris <unk> with Deutsche Bank. Your line is life.

Hey, good morning, guys.

Good morning, Thanks for taking the court.

Thanks for taking the question.

So it's.

Speaker 13: Talking about acquisitions, Jim, you know, I know you, you mentioned that, you know, there's there's a big pipeline out there. We think there's going to be stuff that might come available next year. That's related to debt. Refinancing is you guys look at the potential pipeline. A lot of deals. You a lot of the acquisitions you've done last year.

Talking about acquisitions, Jim you know I know.

You mentioned that there is.

There's a big pipeline out there.

We think theres going to be stuff that might come available next year, that's related to debt refinancing as you guys look at the potential pipeline a lot of deals a lot of the acquisitions you've done last couple of years have been one off assets bigger bigger EBITDA assets.

Speaker 13: couple years have been one-off assets, bigger EBITDA assets. What's your willingness to do either a portfolio type of deal or

Your willingness to do either a portfolio type of deal or something where there's a lot of capex involved upfront.

Speaker 13: something where there's a lot of CapEx involved up front. Are you willing to do different kind of deals in kind of what you've done in the last few years?

You're willing to do different kinds of deals and kind of what you've done in the last few years.

Speaker 1: You know, Chris, the short answer is it really is transaction-dependent. And, you know, if we see a portfolio that we believe is, you know, accretive to shareholder value, and, you know, if assets need to be repositioned and they, you know, they have CapEx needs, and we can see our way clear to, you know, performance in the near term.

Chris is the short answer is it really is transaction dependent and.

If we.

We see a portfolio that we believe is accretive to shareholder value.

And you know if assets needed to be repositioned and they you know they they have capex needs and we can see our way clear too.

Performance in the in the near term.

Speaker 1: we would do that. I mean, I think a great example of an asset that has performed extremely well for us that needed to be repositioned is

We would do that I mean, I think a great example of an asset that.

It has performed extremely well for us that needed to be repositioned as the Venetian.

Speaker 1: And we brought that asset in 2015 and completely reimagined the property and invested, I think, $120 million to reposition it, including, you know, new amenities, a new spa, a new fitness center, a new lobby bar, and complete renovation of all the guest rooms. And the asset is doing exceptionally well. So if I could find another Phoenician, that is something that we would.

And we bought that asset in 2015 and completely re imagined the property and invested I think $120 million.

To reposition it including.

New amenities in the Spa and fitness center.

New lobby bar.

And the complete renovation of all the Guestrooms and the asset is doing exceptionally well so if I could find another Phoenician a that is something that we would.

Speaker 1: certainly be interested and excited about doing with respect to portfolio deals.

Certainly be interested and excited about doing with respect to.

Portfolio deals.

Speaker 1: Uh, we will look at, uh, we, we look at everything that's out there and, uh, we look at it with an open mind, uh, and if there is a, uh.

We will look at.

We look at everything Thats out there and we look at it with an open mind.

And if there is a.

Speaker 1: A transaction that we believe is accretive, we would certainly take it down.

A transaction that we believe is accretive we would certainly take it down.

Okay. Thanks, Jim.

Sure.

Speaker 3: Thank you. We have reached the end of our question and answer session, so I will now turn the call back over to Mr. Rizzolio for his closing remarks.

Thank you we have reached the end of our question and answer session. So I will now turn the call back over to Mr. <unk> for his closing remarks.

Well I'd like to thank everyone for joining us on our third quarter call. Today, we appreciate the opportunity as always to discuss our quarterly results with you.

Speaker 1: Well, I'd like to thank everyone for joining us on our 3rd quarter call today. We appreciate the opportunity as always to discuss our quarterly results with you. And we look forward to seeing many of you in person at and other conferences in the coming weeks. Have a great day. Thank you.

And we look forward to seeing many of you in person at NAREIT and other conferences in the coming weeks have a great day. Thank you.

Thank you. This concludes today's conference and you may disconnect. Your lines at this time and we thank you for your participation.

Speaker 3: Thank you. This concludes today's conference and you may disconnect your lines at this time. And we thank you for your participation.