Park Hotels & Resorts Q1 2023 Earnings Call Transcript

Quartr
Provided by Quartr
May 1, 2023

There are 17 speakers on the call.

Operator

Welcome to Park Hotels and Resorts First Quarter 2023 Earnings Conference Call. At this time, all participants are in a listen only mode. A question and answer session will follow the formal presentation. Please note this conference is being recorded. At this time, I'll now turn the conference over to Ian Weismann, Senior Vice President, Corporate Strategy.

Operator

Mr. Weissman, you may now begin.

Speaker 1

Thank you, operator, and welcome, everyone, to the Park Hotels and Resorts First Quarter 2023 Earnings Call. Before we begin, I would like to remind everyone that many of the comments made today are considered forward looking statements under federal securities laws. As described in our filings with the SEC, these statements are subject to numerous risks and uncertainties They could cause future results to differ from those expressed, and we are not obligated to publicly update or revise these forward looking statements. Actual future performance, outcomes and results may differ materially from those expressed in forward looking statements. Note that all comparisons to prior year periods are on a comparable basis as defined in our earnings release.

Speaker 1

Please refer to the documents filed by Park with the SEC, specifically the most recent reports on Form 10 ks and 10 Q, which identify important risk factors and could cause actual results to differ from those contained in the forward looking statements. In today's call, We will discuss certain non GAAP financial information such as FFO and adjusted EBITDA. You can find this information Together with reconciliations to the most directly comparable GAAP financial measure in this morning's earnings release as well as in our 8 ks filed with the SEC and the supplemental financial information available on our website atpkhotelsandresorts.com. This morning, Tom Baltimore, our Chairman and Chief Executive Officer, will provide a review of Park's Q1 performance and capital allocation initiatives as well as an update on our full year 2023 guidance. Sean Dell'Orto, our Chief Financial Officer, will provide additional color on Q1 results, an update on our balance sheet and liquidity and further details on guidance.

Speaker 1

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

Speaker 2

Thank you, Ian, and welcome, everyone. I am pleased to report another very successful quarter where we delivered impressive top line results and significant margin expansion as we continue to execute against our strategic priorities and benefit from a strong recovery taking shape across our portfolio. We remain optimistic about our outlook Our ability to continue to deliver sector leading results, while creating value through our prudent capital allocation, including continued debt reduction, stock buybacks and ROI investments. Turning to operations. 1st quarter results Exceeded expectations, driven in large part by ongoing improvements at our urban hotels In sustained strength at our resort markets, Q1 comparable RevPAR increased an impressive 37% Year over year, with occupancy up 1400 basis points to 65% for the quarter An average rate higher by nearly 7% over the same period last year.

Speaker 2

While all demand segments witnessed year over year gains, We were particularly impressed with group trends, with revenue up 74% year over year to $124,000,000 Recovering to 83% of 2019 levels. Healthy group performance, particularly banquets and catering, Coupled with the ongoing benefits from the aggressive cost cutting measures we implemented during the pandemic, helped to drive Exceptional margin gains during the quarter, with hotel adjusted EBITDA margin improving approximately 550 basis points year over year to 24.2 percent or approximately 115 basis points above the midpoint of our guidance, an impressive accomplishment in the face of increased cost pressures. Overall, food and beverage revenues exceeded our expectations by over $15,000,000 during the quarter, driven in large part by banquets and catering with notable strength in New Orleans, Orlando and San Francisco. The acceleration in group demand is expected to be a primary driver of growth for Park in 2023 as group ADR is expected to See 2019 by 4%. Q1 group revenues exceeded our forecast by 15% Approximately $16,000,000 during the quarter and we continue to see strong short term group bookings with the portfolio picking up approximately 300,000 room nights for 2023 during the quarter, accounting for $66,000,000 of incremental revenues, With gains primarily concentrated in San Francisco, New York and Orlando.

Speaker 2

In addition, group revenue pace for 2023 increased by As we look out to 2024, we are encouraged by the momentum in some of our larger group markets with 2024 Portfolio wide group revenue pace as of March 31, 2023, up 9% Compared to the same time last year, driven by strong convention and citywide activity expected for Chicago and New Orleans And healthy in house group booking activity, including at the Bonnet Creek Complex in Orlando, where we expect See significant benefit from the expansion of the meeting space platforms at both the Signia and Waldorf Astoria With 2024 group revenue pace currently up 47% versus 2023 at the complex. Turning to our markets. As we anticipated, the rebound at our urban hotels was very robust, with In Hawaii, performance remains very strong with Q1 RevPAR up 26% over 2022. RevPAR at our Hilton Hawaiian Village Hotel was up 32% to 2022, evenly split Between occupancy and ADR gains and driven by continued strength in transient demand despite Travel from Japan being down 93% to Q1 2019 at the hotel. The hotel also saw strong food and beverage revenues from both outlets and group catering of approximately $10,000,000 or 78% 2022 and well managed cost controls that resulted in an impressive hotel adjusted EBITDA margin Of 39.8 percent or 440 basis points above 2022 and 100 basis points above 2019.

Speaker 2

Our Hilton Waikoloa Hotel witnessed a 5% year over year increase in RevPAR despite Challenging comparisons to near buyout conditions during Q1 of 2022 Effective cost controls and modified outlet strategy at the hotel resulted in a 39.3 percent hotel adjusted EBITDA margin We're 150 basis points above 2022 and an incredible 840 basis points above 2019 With the decision to shrink the overall size of the hotel in 2019, materially improving operating efficiencies. Looking ahead, we expect our 2 hotels in Hawaii to deliver mid single digit RevPAR gains over the balance of the year, And demand is expected to be driven mostly from U. S.-based travelers as international demand is still 60% below 2019 levels for our 2 hotels. However, we expect to see increased inbound activity from Japan Toward the second half of the year, which should provide a strong tailwind to performance over the next few years. Turning to our urban markets.

Speaker 2

We were particularly encouraged by better than expected group performance in San Francisco with Q1 convention room nights up Over 200% to over 140,000 room nights versus the same period last year. In addition, A healthy showing during the JPMorgan conference helped to drive meaningful rate increases across the city. Group revenues for our 4 San Francisco hotels We're up over 5 30 percent to last year with group rate exceeding 2019 by 15%. Q1 RevPAR averaged $142 with ADR just 8% shy of 2019 levels as we witnessed Solid rate gains during the quarter. Significantly, all 4 hotels generated positive EBITDA during the quarter, A first since the start of the pandemic.

Speaker 2

Looking out over the balance of the year, convention room nights in San Francisco are expected to reach 675,000 or an increase of 78% year over year with over 60% of the room nights booked for the second half of this year. In our other urban markets, Washington, D. C. Delivered Over 80% RevPAR growth year over year, driven by stronger than expected performance from government travel, Our Chicago and Boston markets showed approximately 50% 42% year over year RevPAR growth, respectively, while RevPAR at our Hilton New Orleans Riverside improved by 37% year over year, driven by double digit growth in all segments, particularly among group, which was up 49% to last year. We were especially pleased to see the return of large medical events To New Orleans during Q1, a sign of the continued momentum in group recovery across our portfolio.

Speaker 2

Finally, New York City continues to show remarkable progress benefiting from all three demand segments with RevPAR increasing 113 year over year or just 5% below 2019 levels, driven by strong rate growth, Up over 4% year over year and a 35 percentage point increase in occupancy to 69% for the quarter. We saw another strong group quarter in New York, with group revenues during the Q1 surpassing 2019 levels By approximately $640,000 our group booking strength continued with $30,000,000 of business booked during the quarter, including an incremental $8,000,000 for 2023. We expect 2023 hotel adjusted EBITDA from New York to surpass 2019 levels. As we look out over the balance of the year, we recognize that the macro backdrop remains uncertain. However, at this point, we have not witnessed any notable impact on our business.

Speaker 2

We remain constructive on hotel fundamentals and anticipate demand trends to remain healthy, especially across our major U. S. Cities as an expected pickup in convention room nights Should support improving group trends, our anticipated ongoing leisure strength, especially in Hawaii, should continue to drive outperformance. Regardless of the macro backdrop, Park remains well positioned to handle Potential fluctuations in the economy with approximately $1,800,000,000 of liquidity available, and we remain laser focused on prudent capital initiatives, which we are confident will create long term value for shareholders. And despite the more challenged credit markets, We expect to target $200,000,000 to $300,000,000 of non core asset sales this year, utilizing excess liquidity to further reduce leverage And reinvest back in our portfolio through value enhancing ROI projects, while opportunistically taking advantage The relative disconnect between public and private market pricing through leverage neutral stock buybacks.

Speaker 2

During the quarter, we used cash proceeds from the sale of the Hilton Miami Airport Hotel and cash on hand To fully repay the $50,000,000 balance on our revolver and repurchase 8,800,000 shares At a nearly 10% implied cap rate and a material discount to consensus net asset value. Finally, we plan to invest over $300,000,000 back into our portfolio this year, including the final phase of the Tapatera rooms renovation at our Hilton Hawaiian Village Hotel, the full scale renovation, rebrand and resiliency upgrade Our Castle Marina Resort in Key West and the transformative renovation and meeting space expansion at our Orlando Bonnet Creek Complex. Turning to guidance. Given our better than expected results during the Q1, we are increasing our Full year 2023 guidance range and remain on track to deliver sector leading RevPAR and earnings growth this year. Specifically, we are increasing our adjusted EBITDA forecast by just over 2% or $14,000,000 at the midpoint to a new range of $624,000,000 to $704,000,000 While our adjusted FFO guidance increases by approximately 9% or $0.15 per share at the midpoint To a new range of $1.76 to $2.12 per share, representing year over year adjusted EBITDA growth of 10% and AFFO per share growth of 26%.

Speaker 2

I want to reemphasize Our team remains laser focused on executing our internal growth strategies and capital allocation priorities, which we are confident We'll create long term shareholder value and position the company for long term success. With that, I will turn the call over to Sean.

Speaker 3

Thanks, Tom. Overall, we were very pleased with our Q1 performance. As Tom noted, Q1 RevPAR came in at approximately $159 With 65% occupancy and strong ADR growth of 7% year over year to $2.44 or 8% above 2019 levels. Hotel revenue was $623,000,000 during the quarter, while hotel adjusted EBITDA was $151,000,000 resulting in hotel adjusted EBITDA margin of over 24% or 5.50 basis points about the same period in 2022. Q1 adjusted EBITDA was $146,000,000 and adjusted FFO per share was $0.42 or 25% above the midpoint range of the guidance we set last quarter.

Speaker 3

Turning to the balance sheet, our current liquidity is approximately 1.8 When net debt peaked at approximately $4,500,000,000 Overall, our balance sheet remains in excellent shape with ample liquidity Execute our strategic priorities regardless of potential shifts in the macro backdrop. In terms of deleveraging, during the Q2, we We remain confident we will have a resolution by early summer. Turning to guidance, our RevPAR forecast for the year remains unchanged at $167 to $179 or a year over year increase of 10% at the midpoint, Our hotel adjusted EBITDA margin forecast has increased versus prior guidance by 10 basis points to a new range of 26.8% to 27.4%, a roughly 125 basis point improvement at the midpoint over the prior year. Better than expected margin gains were driven by solid group contribution as group demand continues to build, a trend we anticipate continuing throughout the balance of the year, helping to offset increasing costs for property insurance and utilities. While we are moving away from providing quarterly guidance, Now that we have lapped the impact of last year's omicron surge, we wanted to provide a bit more color on 2nd quarter expectations.

Speaker 3

Despite facing difficult year over year comparisons, we expect our portfolio to continue to narrow the gap to 2019, With Q2 RevPAR forecast to be up year over year within a range of 7% to 11%, driven in large part by our portfolio of urban hotels led by Chicago, New Orleans, San Francisco and New York City. Note, however, that Q2 margins likely to soften relative to last year's peak performance, which was driven by outsized cancellation income during Q2 2022 That exceeded $9,600,000 or roughly $6,000,000 above historical levels and disruption this quarter from the comprehensive renovation of our Casa Marina Resort in Key West, with operations expected to be suspended from mid May through most of Q4. Overall, the negative impact on earnings from Casa Marina renovation is forecast to be approximately $14,000,000 for the full year, With a roughly 130 basis point drag on RevPAR growth and a more than 30 basis point drag on hotel adjusted EBITDA margin during the 2nd quarter and negatively impacting full year RevPAR growth by a forecasted 110 basis points and hotel adjusted EBITDA margin by 30 basis points. As a reminder, the renovation disruption at Casa is already factored into our full year guidance.

Speaker 3

This concludes our prepared remarks. Operator, may we have the first question please?

Operator

Thank you. Comes from the line of Smedes Rose with Citi. Please proceed with your question.

Speaker 4

Hi, thank you. What you're seeing in San Francisco through the balance of the year and maybe just any visibility over the next couple of years. And I don't know if you'd be willing to or not, but is there any way you could just kind of ballpark kind of general ranges of EBITDA that you think those properties can generate This year and where you might where you'd be happy to see it to move to next year?

Speaker 5

Yes. It's Great question, Smedes. I mean, obviously, there's a lot to unpack there. I think you know and I think I've shared with listeners before, I mean, I've spent A considerable amount of time out there. I find myself out every 4 to 6 weeks approximately meeting with City officials, SF Travel, other business leaders, operators and obviously with us certainly having a good presence there, about 15% of sort of pre pandemic EBITDA.

Speaker 5

It's important that I'm out there. I'd make The overall observation, we're not expecting San Francisco to be a huge contributor. I would say in the $20,000,000 to $25,000,000 range across the guidance that both Sean and I outlined. So I'd make that A comment. So when you think about this year in particular with about 675, Citywide room nights, which is again significant, but certainly below the all time high in the 2019 level.

Speaker 5

Although if Look historically, I think they ran about 800,000 to 850,000 approximately, but certainly 675,000 is It's solid performance. About 60% of that is back loaded to the second half of this year. So we are cautiously optimistic. Obviously, the first Quarter was very strong, up 200% and up 140,000 room nights. So It got off to a good start.

Speaker 5

It is still a challenging environment. When you think about San Francisco, we have no doubt in our view That certainly San Francisco comes back. It's not a matter of if, but when. I would say given some of the recent reports, That probably is being extended a little and perhaps elongated a little. SF Travel is going through A change in leadership, obviously, the booking pace that they recently communicated was slightly down from expectations To around 500,000 to 550,000 over the next few years.

Speaker 5

The narrative is certainly still gotten away from them a little. I will tell you that street conditions are better. The mayor's initiative, the 47 initiatives in 9 strategies, I think are encouraging. The AI spend is about Six times higher in San Francisco than in any other market in the country, obviously the 5th largest economy. So the fundamental benefits, I think, of San Francisco are certainly sound.

Speaker 5

You have, obviously, rising office vacancy Rates which are certainly alarming and certainly something that we're watching carefully. So and we have obviously Our maturity at the end of the year, which obviously we are addressing in short order, and as Sean said in his prepared remarks, We certainly plan to have that resolved by early summer. So as we sort of look out, obviously, Q1 was up 183%, we certainly don't expect that to continue at that sort of clip. As we think about The Q2, we would expect 15% to 20% Up in RevPAR over 2022 and that's largely the 2 pack, The 3,000 room complex as we sort of look out, but cautiously optimistic as we look out, But we are also not naive. We understand the complexity of it and we certainly believe that San Francisco is going to take time and it's going to be a few years before it certainly fully recovers.

Speaker 4

Okay, thanks. That's helpful. I just wanted to ask you too, you mentioned targeting $200,000,000 to $300,000,000 of non core asset sales. Could you maybe just Speak to kind of what you're seeing on valuations on that side, kind of what you've seen it sort of in cap rates or EBITDA multiples or however you want to Kramer?

Speaker 5

Yes. I would I'd make the observation. Obviously, we sold 7 assets last year for north $300,000,000 obviously, we've completed the Miami sale earlier this year. I think even in the worst of times, Smedes, as you know, Even in the middle of the pandemic, we sold 2 marquee assets in San Francisco, 1 La Meridion for north of 630,000 a key and Obviously, the autograph there, the Adagio for almost $500,000 a key. So look, there's still plenty of capital, Owner operators, private equity, obviously, the debt markets are constrained.

Speaker 5

I would say that asset sales, dollars 100,000,000 or less, I think are easier to get done. Clearly pricing is certainly depending on where you Price the debt and I think around 8% is probably where a lot of the debt is getting priced and perhaps some even higher. We're still confident We'll be able to achieve the objectives that we've outlined. I think we've met or exceed all of the non core asset sales that we've outlined over the years and think we're now up to 39 assets and about $2,100,000,000 in recycling non core assets and that's Of course, including 14 international assets and many assets that had lots of complications and lots of hair. So the team is very skilled, very experienced and we're confident that we'll get at least $200,000,000 in asset Sales done this year and certainly if not higher.

Speaker 4

Thank you. Appreciate it.

Operator

Yes. Thank you. Our next question comes from the line of Duane Pfennigwerth with Evercore ISI.

Speaker 6

Please proceed with your question.

Speaker 7

Hey, thank you. Good morning.

Speaker 5

Good morning. Good morning, Sam.

Speaker 7

Good morning. Just on San Francisco, Obviously, a hotly debated market, but one is you're showing that is improving. For the investors that are evaluating Whether or not you should give the keys back on some of those assets, and you know better than we do, there's a lot of strong opinions on that issue. How do you think about giving the keys back as one of your options? And what are the positives and negatives

Speaker 5

Thank you for the question. First, I would I want to say we are under a confidentiality agreement. We are in discussions with the servicer. All options are being explored. And I emphasize all options are being explored.

Speaker 5

And we expect to have this resolved by the summer. Look, these are never Cut and dry. So if we were hypothetically to give back the keys, there's a forgiveness of debt Income that we would have, we're able to shield certainly most of that, but not all of that, It would result in a potential dividend payout of $150,000,000 to $200,000,000 approximately. In theory, it obviously reduces our leverage, but it also takes away A growth story and some optionality in San Francisco, certainly depending on what you believe in its timeline. And as I said earlier, based on this AI revolution that I think we can all are reading and hearing about, I mean, it is Anchored in San Francisco and the spend again being 6 times that level.

Speaker 5

San Francisco historically is a high beta market. So it goes through these periods of sort of boom and bust, Clearly a tougher period now, but we are seeing it certainly beginning to recover. I think that recovery is going to be a little more elongated, But we certainly believe that we are going to carefully examine the options. And make no mistake, we are going to do what's in the best interest of shareholders and what creates the most value.

Speaker 7

Thank you for those detailed thoughts. And then just for my follow-up On New York, I guess it caught my attention that you felt like New York could be above 2019 on EBITDA. Can you talk about The drivers of that, which segments are really leading that? And maybe how sustainable you think that is? Are there Maybe changes in the operating model or things of that sort?

Speaker 7

Thank you.

Speaker 5

Yes, it's another great question. One of the things I'm really glad you asked the question. Within the last year or 2, we talked a lot about we were retooling And we use the pandemic to really imagine reimagine the operating model. I'm not sure a lot of investors and a lot of analysts really believed us, But I say confidently that I could not be more prouder of the team, particularly our asset management team and Sean and his leadership and the men and women that have worked so hard. Reminding listeners, we took out 1200 FT feet feet feet feet feet feet feet feet feet feet feet feet Es.

Speaker 5

It's about 55% of management and 45% hourly. We removed redundancies, sales and marketing That was $85,000,000 and about 300 basis points. And I remind people that we were in this challenging environment, Margins up north of 500 basis points. I mean that's not by luck, that's by hard work and discipline and Really grinding in and looking using the crisis as a way to have a better operations. We reported last quarter that labor costs were 16 Fewer management FTEs than Q1 2019.

Speaker 5

So the team is working really hard and I think it's showing and it's Showing by the results that we certainly are outlining today. New York is one where you think back to middle of the pandemic, Many naysayers out there that New York would never come back and it would be 27 or 28 or some Sort of silly logic like that that we heard from some. Again, we were up 113% RevPAR this quarter and as we stated, we fully expect that we will exceed 2019 levels in EBITDA. The city is activated. People are going back to the office.

Speaker 5

It's only it's accelerating. And so we are You're seeing the city back and no doubt we feel very good about the outlook in New York and we feel very good about our positioning. There are only Three large boxes that can take significant group business and we certainly believe we have the best meeting there and that we're well positioned and excellent leadership team there on-site. So excited about New York and very encouraged. And

Operator

Our next question is from the line of Floris Van Dykem with Compass Point.

Speaker 8

A quick Follow-up here and I don't want to belabor New York a little bit too much, but I think New York had hotel EBITDA that was negative in the Q1 of $3,000,000 And I think full year last year was or sorry, in 'nineteen was $47,000,000 So that implies a Pretty steep ramp up, which sort of is in line with your comments, but it's maybe a little bit steeper than people were thinking. Is that the right way to think about it?

Speaker 5

Yes. I mean, part of it, keep in mind, it's our softest quarter in New York and Occupancy about 69 percent and RevPAR at only like $170 plus or minus and EBITDA was $3,400,000 negative. So that does imply that the balance of the year will be certainly Above $50,000,000 And as we look out today, that's a number that we're comfortable with. And I think as I said, We're also looking at RevPAR that pretty significant. So I said double digits, but substantially more than that as we look out to just Q2 as an example of that.

Speaker 5

And we've also got Group room nights on the books about 180,000 and that's all when you can anchor a big hotel like that With group and then layer in your transient, really helps the overall profitability. So feel good about that as we look out today. 80% of the demand tends to really be on the domestic front, but the international piece is growing. And We are historically about 16% to 17%, which is helpful. And as you see, clearly that travel coming Certainly out of Europe is very helpful.

Speaker 5

Asia is not back yet, but we feel very good about the Pace in New York at this point.

Speaker 8

Thanks, Tom. And maybe my follow-up, I'm thinking, obviously, you bought back 8,800,000 shares in the Q1. You did sell a hotel. How should we think about the percentage if you're looking to sell another $200,000,000 before the end of the year, which is what How do you weigh those 2? And obviously, you have some redevelopment capital that you probably need to spend as well.

Speaker 8

Hey, Floris, this is Sean.

Speaker 3

I mean, I think we should think about it. We want to certainly do it on a leverage neutral basis. So you can kind of I think factor it in That way as we think about it going forward, and in terms of, I think certainly as you talk you mentioned with the ROIs, we certainly have a focus on that as well. So while there still be some buybacks in play, I think you could probably see us more leaning towards Redeployment within the portfolio are some deleveraging. And just a quick note back on New York, so just so you have it, I mean, we lost $2,000,000 in Q1 of 20 So as Tom mentioned, it's a soft quarter, so it's nothing unusual to look at this year.

Speaker 8

Thanks guys. That's it for me.

Operator

Our next questions are from the line of Dany Assad with Bank of America.

Speaker 9

So I guess, Tommy, you raised the full year by the amount that you peaked in the Q1, but your comments are actually pretty encouraging here. So I guess my question is, first of all, how is Q2 shaping up compared to where you thought it was going to be 60 to 90 days ago? And should we is there some macro or any kind of conservatism that we're baking into the balance of the year? Just trying to kind of square how positive your comments are to kind of your the underwriting for the year?

Speaker 5

Well, I want to Dan, it's great questions. I want to also preface my comments, but think back to the comments that Sean made. You've got some Tough comps there and cancellations and obviously 2nd quarter was very strong last year. It has historically been our strongest quarter. So we're certainly optimistic.

Speaker 5

And as again, the RevPAR that we gave in kind of that 7% to 11%, we're Certainly very, very comfortable with that. Group pace looks good as we look out as well, but let's all not Kit ourselves here. There's still a lot of uncertainty. We've got a lot of variables here. As the Fed getting at the We're getting at the peak of the tightening cycle.

Speaker 5

There's still concerns about a potential credit crunch. None of this is a surprise to you or any of the listeners. Consumer is still strong with about $1,100,000,000,000 And savings, the savings rate about 6.2%, obviously low unemployment. So it doesn't look and feel like a recession, but clearly depending on the signals and direction of the Fed here and then given obviously This tightening credit on the banking side, there's certainly a bit of conservatism in there, but there are some Tougher comps in there. So we feel good.

Speaker 5

We are comfortable with the guidance and obviously that pull forward And we're very comfortable about the Park story. The team has worked incredibly hard. No secret, we were probably dealt one of the difficult hands in the pandemic and coming out of it, but I would also say think about the moves that we made. No dilutive equity raised. We did 3 bond deals and pushed out maturities.

Speaker 5

We've recycled capital. People forget we were self operating a bunch of hotels. We had laundry facilities, joint ventures, international hotels. I mean all of that, a large part of that has been cleaned up. And so we are in our top 27 assets account About 90% of the value of the company.

Speaker 5

So we are laser focused on continuing to reshape and we are optimistic about Q2 We still don't have the Japanese traveler back. So that again provides another tailwind. So few headwinds out there, But there are a number of tailwinds also that really benefit the Park story, I think very different than many of our peers. And again, Up 500 basis points in margins. That doesn't happen without a lot of hard work by the team.

Speaker 9

Super helpful, Tom. Thank you. And then my follow-up question is a little bit on group. Just can you comment a little bit more on that group strength? What's driving that in terms of different segments of group, whether it's Association, Smurf and so on?

Speaker 9

And maybe at the same time remind us of The profitability of those different segments that we have in the portfolio.

Speaker 3

Hey, Danny, this is Sean. I'll take that one. I think there's probably a few key takeaways here with group. Clearly, it's a great story. It's helped Park outperform In Q1 versus as we kind of look at our performance in our markets relative to the market performance, we were certainly up and beating that Taking share in just about every market.

Speaker 3

So with total RevPAR up 40% versus the 30% almost 37% on room RevPAR, clearly there's an out of room spend here component that's Driven by group. So I think some of the themes here certainly remains near term 60 days out, but it's elongating. We had almost 60% of the room nights booked in March, were for March or Q2. So again, still somewhat near term, but we also booked 77,000 room nights The ability to book out further, probably see the need to book out further, I think they're generally pretty bullish on having events in person. So you're starting to see that momentum right now.

Speaker 3

It's a mix shift right now within group to your point about some of the sub segments. We're seeing more out of the corporate Group as well as the convention, really picking up. I think from an in house corporate groups, we expect that to recover pretty quickly throughout the year, Seeing it going down from about 20% down in revenue to 2019 in the Q1 to basically being flat to slightly up by Q4. Conventions improving almost 90% of 2019 levels. Quarter to quarter, it's going to be a little bit mixed bag based on the calendars.

Speaker 3

But Again, those 2 are the bigger components traditionally of this portfolio and certainly the better revenue producers for us. So seeing those Coming back and ultimately taking share more of the mix is certainly kind of baked into how we think about the year going forward. Think finally one last thing to do, one last takeaway is there's a tailwind here still where relative service we've seen recently, people still talk about 30% of the canceled COVID Events still need to be rebooked. So we think certainly that's a tailwind for our portfolio, going into only in the next year as people start to try to rebook those events.

Speaker 9

Awesome. Thank you very much for that.

Operator

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

Speaker 10

Hi, good morning.

Speaker 11

Good morning, Kevin.

Speaker 10

Good morning, Tom. A question on business transit. There's been a lot of very positive data points on group. Maybe some detail on how BT trended in the quarter and what you're assuming for the back half of this year in terms of recovery there?

Speaker 3

Yes, Anthony, it's Sean again. I mean I think BT as a whole is tracking well and I would say certainly we would say it's It was down overall in revenue about 10% to 2019 levels, but we see that improving and actually being up High single digits by the back part of the year, maybe even low double digits. Clearly, we get focused on the corporate negotiated A lot where you see within financial services or tech, professional services, I mean that sub segment has certainly been off. It's down 40% to 2019 in Q1. We do see that improving through the year, getting to probably 20% down by the back half.

Speaker 3

But you've got rack rate, you've got Government and you got local negotiated all kind of helping to kind of pick up the slack a little bit. I mean from a rack standpoint, I think You've probably heard another commentary certainly from Hilton that you're kind of you're going after more of the smaller businesses. And what we're seeing there is Yes, that usually comes through in more local and as well as RAC. And so RAC is about 30% above corporate negotiated on rate On average and while local and government are below on rate about 25%, I would say the vast majority of the pickup on the mix is on the RAC So all in all, we think business transient as an overall segment is recovering through this year and getting back to 2019 levels Easily by certainly midpoint in this year or the back half. It's just again over a lot of attention on the corporate negotiated makes It feels like business trends is down, but it's really not.

Speaker 10

Got it. Okay. And maybe one more. I saw that you bought some land in Hawaii So, why and Miller just talked about doing the tower there. Could you maybe update us on the scope of that project timing, the opportunity there?

Speaker 10

That would be great.

Speaker 5

Yes. Anthony, as we've said, it would be the opportunity to add a 6 tower there. We own the land, We're pretty excited about. We're working through the entitlement process. It's probably another 12 to 18 month process, plus or minus.

Speaker 5

And We're looking at 500 keys plus or minus that possibly could be added. And As you know, that is a world class resort. We've got nearly 2,900 rooms, 5 towers. Is also an additional 1,000 units of timeshare, which we don't own. And you look at the extraordinary success that we had last year, Again, not having the Japanese traveler, they're down 95%.

Speaker 5

We did historically about 150 weddings there a year. I think we did less than 5 last year and Japanese traveler who typically account for about 20% of our business, We expect we'll start to see more visitation in the second half of the year, but we are tracking Probably another all time high in EBITDA. So feel very good about what's happening there, not only there, but also on the Big Island. So We think a future investment there is going to be extraordinarily accretive. We also, again, as we Are more profitable today in Hilton Waikoloa as a 600 room hotel than we were as a 1200 room hotel.

Speaker 5

And in addition to that, we have uncovered that we have the rights for an additional 200 keys that we can add there. So The story in Hawaii for Park only gets better and only gets stronger as we look out. That's right. Thank you.

Speaker 4

All right.

Operator

Our next question is from the line of Aryeh Klein with BMO Capital Markets.

Speaker 6

Please proceed with your question.

Speaker 1

Thanks and good morning. Maybe as it relates to guidance, it seems to imply about 2% to 3% RevPAR growth In the second half of the year, how would that compare to your expectations on the expense side? And maybe what are the more significant pressures on From a broader perspective?

Speaker 3

Yes. I think, on the expense side, we certainly we see Expenses, as we talked about, Q2 being a little bit higher than revenue, clearly, we see a little bit of margin Year over year decline, but once we get into the back half of the year, we see that be more balanced between Revenue and expense growth with slight edge to revenues, we should expect to see some margin improvement year over year. And so I think we feel pretty good about kind of where we are. I mean certainly the expense size we think about Performance in Q1 on the cost side, as Tom alluded to, with the $85,000,000 of savings, you feel that's intact. I mean, wages Probably been tracking 4% to 5% up year over year for the last few years.

Speaker 3

I think overall payroll is up 20% since 2019, Yes, on a nominal sense, we're 3% down to 2019 in Q1. From a headcount standpoint, Our management FTE positions are down 14% and hourly are down 19% in Q1 relative to 2019. That's versus the 8.5% Reduction, we've talked about to folks in terms of that $85,000,000 of savings. So we feel good about where that's tracking. And I think we have that In pretty good control.

Speaker 3

I think where you see some of the pressures as you go in the back half of the year, I think remain insurance and utility costs. Utilities are up 22% since 2019, 40% on a per occupied room basis. So it's certainly going to impact some of that savings we've talked about. We've certainly seen soft periods on insurance, as well as utility costs can soften as well. So that could ultimately be something where we benefit in the future.

Speaker 3

And we have lower exposure on the insurance side than many I think because we have we haven't had the losses. While we're certainly cat exposed, I think we certainly I expect to fare better than most in that just because we haven't any losses in the last few years.

Speaker 1

Thanks. And then Tom, maybe just As you think about the San Francisco market and maybe to the extent you're positioning for recovery, how much capital do you think is required Invest in the assets you have in that market to remain competitive over the next couple of years.

Speaker 5

First would be the Park 55. We've completed the model rooms. We were prepared to complete That's about 10 24 units in that hotel. So that's about a 90,000,000, but probably over a 5 year stretch, it's Probably approaching $200,000,000 in total. We've renovated the ballroom, The public space in the San Francisco Hilton, but as you look out over a 5 year period, it's probably in the $200,000,000 range plus or minus.

Speaker 5

Again, that's 3,000 rooms at those two properties.

Speaker 1

Appreciate that. Thanks.

Speaker 4

Okay.

Operator

Our next question is from the line of Dorey Kestin with Wells Fargo. Please proceed with your questions.

Speaker 12

Thanks. Good morning. Good morning, George. Hey, can you talk about the renovation plan? I think it's for the Rainbow Tower, in Hawaii for next year, if you just if you have expected costs yet and what renovation disruption Maybe and then the eventual upside you expect?

Speaker 5

Yes. We're just in the process of Planning that, Dory, we're going to finish Phase 3 of the Tapper Tower this year. Really excited about the work being done there. Obviously, Rainbow Tower will be next In the queue and obviously when you're running as you know high 80s to mid-90s occupancy, it's a bit of a high wire act As we manage these renovations, but Karl Mayfield and our design and construction team are really best in class. And as you saw, obviously, as we talk about the Casa that we're We're going to take offline and the very modest disruption we're going to have there.

Speaker 5

These things are really well planned out and well thought out. And I would say the Rainbow Tower will be the same. We will design, we'll get a few model rooms done, we'll organize, we'll find the Softest periods we can to complete them with minimal disruption on the operations, but that will be next in Q and that's probably a 24, 25, but don't have any disruption data for you today. We'll follow-up As that information becomes more available.

Speaker 12

Okay. And you mentioned group revenue pace for 2024 was up 9% year over year. I didn't think I caught where, I guess, in the context of the team it is.

Speaker 3

I'm sorry, Dror, what was that last part? Yes, we missed it a little bit.

Speaker 12

I I didn't catch where it was in the context of 2019.

Speaker 3

So yes, 23 pace by ultimately we think is around ends up like 90 I guess that's ex San Francisco, so like mid low 80s. So it's going to be upwards of kind of upper 80s, based on 2019.

Speaker 12

Sorry, that's 23 or 24?

Speaker 3

It's 24. I was giving a little 23 background, but then

Speaker 5

Yes. Dory, it's low 80s group pace for 24 as Sean said, and again, Ex San Francisco, it's 90.2%.

Speaker 12

Okay, great. Thank you.

Speaker 5

Thank you.

Operator

Our next question is from the line of Chris Woronka with Deutsche Bank.

Speaker 6

Please proceed with your question.

Speaker 13

Hey, good morning, guys.

Speaker 5

Good morning, Chris.

Speaker 13

Good morning. Tom, so there's obviously a lot of moving parts In San Francisco, I think there's a lot of hotels for sale, whether publicly or not, and I'm not including any of Your stuff in that. But the question is, what do you think happens? There's talk of government Buying those for alternative use or others, how does that impact do you think there's any chance we see Some surprising prints on sale, high or low. And how does that really impact what you guys want to do With the refi and your thoughts on the market longer term in terms of some supply potentially coming out?

Speaker 13

Thanks.

Speaker 5

Yes, it's a great question, Chris. Look, we have studied San Francisco. We've looked at the cycles and There are a few, I think, big important takeaways. It's the most supply constrained market, Probably second only to a Key West. We've only got 32,000 Keys versus New York at 125,000 to 150,000.

Speaker 5

It is a high beta market as we all know. And if you look from that So the 2008 through 2019, probably 1st or second best market lodging market. No doubt, it is a more challenged environment today. And it really comes down to Making sure that we are carefully underwriting and understanding the demand flow. Obviously, the recent print from ESA Travel was not particularly helpful.

Speaker 5

Obviously, you're going to have a leadership change there. And obviously, the Sooner that selection committee can get at that work, the better. But we have no doubt that San Francisco recovers For the reasons we talked about, when you think about venture capital, you think about education, the natural beauty, You look at the AI spend, again, you got 6 times the spend in this revolution is going to be anchored there. Having said that, we're not Pollyannaish about this. It's going to be an elongated recovery.

Speaker 5

And again, we are Under our confidentiality agreement, we are in discussions and we will carefully evaluate all options And arrive at the option that creates the most value for shareholders. The office vacancy rate rising, again, is something You need to carefully review and understand. The office sector is clearly going to continue to take it on the Chin there, but these periods of dislocation also create opportunities. We don't see I think it would be difficult for a lot of Office to hotel conversion, so we don't see that really as a risk. It really is about the basic blocking and tackling.

Speaker 5

The Moscone Center has talked about lowering rates that we think that's a good idea. We think a national marketing campaign is another good idea that we Communicated. The ambassador program has been incredibly well received. The street conditions are improving. They're far better than I think it's been reported, but the city's got to do a better job certainly communicating that to the broader public.

Speaker 5

And again, the Q1 was a very strong quarter and we were profitable, but we also recognize that It's still 30% to 40% below 2019 levels and it's certainly lagging the other market. So we're factoring all that in, In those discussions, we're going to be very thoughtful and very disciplined about it and confident we're going to arrive at the right outcome. But remember, San Francisco is a very small contributor to Park this year and the guidance and the overall EBITDA that we've outlined. So the story is intact. It's not driven by San Francisco.

Speaker 5

San Francisco actually is, If we get to an acceptable resolution, it's really the optionality is some additional upside, But it is not a huge drag on our guidance this year because we see a small contribution. The contributions are coming from other cities that really are accelerating and again led by what we're seeing in Hawaii, which just continues to accelerate.

Speaker 13

Yes. Thanks, Tom. Appreciate all the color there. Just as a quick follow-up, in Hawaii and some of the Expansion opportunities you have, you covered a few of them. I know planning is not done and it's a little far out.

Speaker 13

But Is there a way you would look to do that in a more capital light manner given how much construction costs have risen? Or is there offset later down the road with more asset sales, just thoughts on how to make that most, I guess, economical?

Speaker 5

Yes, it's a great point. We will obviously, we're not at that point today. You rest assured as we demonstrated, we're not going any kind of dilutive equity raise and recycling capital, the best use of that recycling capital is to pay down leverage and buyback Stock on a leverage neutral basis and reinvest back in our portfolio. We're investing $300,000,000 and we haven't talked about the Bonnet Creek Resort and what we're doing there, but it is Going to be extraordinary when it is completed, the latter part of this year. We cannot wait to show The expanded meeting space over water, coupled with a completely renovated golf course, plus the Waldorf ballroom, which is already, And then a complete rooms redo at both the Signia as well as the Waldorf Astoria So really excited about that as an example and we'll be thoughtful as we think about how and when we capitalize.

Speaker 5

All options again will be on the table at that. Fortunately, that's a few years out and don't need to make that decision today. Hopefully and expect that we're in a more normalized times and candidly the cost of capital is back to a more normalized environment as well.

Speaker 13

Okay. Super helpful as always. Thanks, Tom.

Speaker 5

Thank you. Have a great day.

Operator

The next questions come from the line of Patrick Scholes with Truist Securities.

Speaker 6

Please proceed with your question.

Speaker 4

Hey, good afternoon.

Speaker 5

Hey, Patrick. How are you?

Speaker 4

Great, great. Thank you. Tom, can you talk a little bit about The mix of what types of businesses gave you the group strength in the quarter. And as you look in your group booking crystal ball for rest of the year and into next year, is That composition of who is strong, who is weak, is that changing at all? And when I say who is strong is weak, financial firms or marketing firms, etcetera.

Speaker 4

Thank

Speaker 5

you. Yes. I'll let Sean jump in on some of the A little more granular, but let me just make a couple of macro comments. I mean, look, as you think about kind of remote work and hybrid work, What we hear from C suite leaders, men and women, as I talk to in various forms that need to bring people together is even greater. And so when you have a portfolio like ours that's so well distributed and also with a lot of meeting space, we are well positioned to take advantage of that.

Speaker 5

We began the year at a forecast of about 2,100,000 room nights. I think we last quarter, we were about 1 point $4,000,000 in definites and we said we needed to make up about $660,000 for the year. Now At the end of the Q1 here, we're at a definite of about 1,720,000, the need to only make up about 330,000 Room nights. So we are very confident that we'll be able to meet our targets, if not exceed them. And also to the point that Sean made, You're seeing about 30% of companies plus or minus that still have pent up demand in group.

Speaker 5

And New Orleans seeing obviously The medical conferences come back and that need to be together isn't going to go away. And as you think about just 23 of the markets, New York and Chicago, we've got 180,000 group room nights, New Orleans, 230,000 New York, again, 180,000 Bonnet Creek, and we're still under I know a transformational expansion 170,000, Illinois Village 100,000 and then of course The complex in San Francisco north of 180,000. So just that backdrop, that's just a half dozen Of our big group houses as well. So we don't see that at all slowing down and we see that as a real competitive advantage for us. And Yes, the leisure continues.

Speaker 5

It moderated in a Key West, but we anticipated and we said that, and we expected that trees don't go to the sky. But We really see the group's got a tailwind as we sort of move forward.

Speaker 3

Yes, I just might add, I wouldn't say there's any Specific verticals that outperformed, I think everybody's kind of just finding their way back and getting into group settings. And so the company in house group and the company side, corporate side, You're seeing just across the portfolio. Again, a lot of it's still very much short term, but you see people coming back, whether it's training or gathering for other things that they haven't done in the past. I think you've seen that come through. Conventions clearly are getting back underway.

Speaker 3

A lot of strength in Chicago, New Orleans And then finally, group tour for the quarter at least is certainly was stronger as you think about things like in group other events like incentive travel and it just takes Took a while for them to kind of get past the pandemic and start getting back on that cycle. So I think just a matter of that delay and that lag of some of these They're kind of group, sub segments absent Smurf, which clearly was one that was a driver during the pandemic. You've seen that kind of just level off and it's been more of the corporate side and convention side really coming back.

Speaker 4

Okay. Great color there. Thank you.

Operator

Thank you. Our next question is from the line of David Katz with Jefferies.

Speaker 14

I wanted to just you've covered a lot of details. So I just wanted to touch on the target of a couple of $100,000,000 of asset sales. And Any color you can provide us with in terms of what the sort of net proceeds on that No, might be or what that might look like. And I think you may have said earlier, obviously looking to improve leverage with those. Just any sense around that would help.

Speaker 14

Thank you.

Speaker 5

Yes. David, obviously, we both Sean and I, I think tried to address it earlier. It's always been our history of continuing to recycle capital and north of $300,000,000 last year. We've set the target of $200,000,000 to $300,000,000 We've obviously already put the print one print on the board with the Miami sale done earlier in the year. And I would say that generally assets Under $100,000,000 would be easier to get done in this environment.

Speaker 5

There are no shortage of capital, whether it's Some owner operators, family offices, private equity, I mean the private equity real estate We're sitting on nearly $400,000,000,000 of capital and that's not even including the sovereigns. So that capital has got to be put to work. And We will be thoughtful. Tom Morey and our Chief Investment Officer and the team, I think have done an extraordinary job over the last several years, and We'll continue to look at non core. Again, our top 27 assets really account for about 90% of the value, as we've said.

Speaker 5

And There's debt capital available. You've just you've got to work a little harder and you've got to find those right buyers. Clearly, a more challenged environment on the debt side right now as the debt markets Have tightened and I wouldn't say we're in a credit crunch, but you certainly have that risk as well. In terms of proceeds, We'll continue to be thoughtful. I mean, the highest and best use of from a capital allocation standpoint, if we continue To trade at 50%, 60% discount to NAV, you can expect that we will continue to buy back stock as we did in the Q1.

Speaker 5

We'll do that on a leverage neutral basis and we'll continue to invest back in the portfolio. Those are really the Best decisions that we can make as a management team at this point and we'll continue to do that.

Speaker 14

Okey doke. Thank you very much.

Speaker 5

Thank you.

Operator

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

Speaker 6

Please proceed with your question.

Speaker 15

Great. Thanks. I just wanted to circle back on Hi, Rob. Hi. On the idea of what's going on with business Transan, when I'm looking at your urban RevPAR and if we exclude San Francisco, which kind of has some city specific issues, It looks like your urban RevPAR was down about 10% versus 2019, which is kind of a little bit or a bit worse than Q4 being down 2% versus 2019.

Speaker 15

So I know you mentioned that business transient is improving, but and maybe that's Just in the markets outside of your urban portfolio, but can you give a little narrative around what's going on with the urban RevPAR? This is excluding San Fran, this sort of Sequentially kind of worse looking and is that just something you're seeing across the board? Thanks.

Speaker 3

No, I would say it's relatively stable, Robin. I think clearly, I mean, you're obviously, you're looking at it, the seasonality element Against 2019 and it's a sequential decline, but I think even in this right, we sit here today still trying to recover. I think some of those weaker seasonal Time frames end up being a little bit more disproportionately weaker, if you can kind of hope that makes sense, but I think you just kind of see a little bit more I think a little bit more underperformance in some of those weaker pockets from a seasonality standpoint. So when you look at the Q4 to Q1, I think it's generally in line. I think we certainly expect that it's more of an improvement as we get through the more through the year.

Operator

Our next question comes from the line of Chris Darling with Green Street.

Speaker 4

Tom,

Speaker 16

what's The latest thinking around a potential rebrand of the DoubleTree San Jose, and anything new you can share as it relates to timing or scope of that project?

Speaker 5

Yes. It clearly is in the queue and love the location, the quality of the real estate. We certainly think in a brand It's the right move. We've got a couple of model rooms done. We continue to study obviously all of Northern California And figure out what the right sequencing is and but that one is Probably more of a late 'twenty four, 'twenty five.

Speaker 5

That certainly is not what I would call in the top tier of our

Speaker 16

you could discuss some of the highlights from, I guess, it's 12 hotels that you classify under the kind of other markets bucket. Looks like that group of properties might have drove some The outperformance and maybe there was some seasonality there, but curious to understand if there's anything worth calling out.

Speaker 3

I don't think anything specific to call out there. Just I think for the most part, it's those are kind of our, I would say non core market areas. I mean, there's probably one that sits in there would be, I believe, The Caribe Hotel, which certainly has been an outperformer for us and it's a little bit disproportionate contributor Given its size relative to a lot of smaller assets we have in that bucket. But they have been generally that group has Somewhat outperformed, because they're not certainly in those CBD markets, just been general outperformance or not also ones that are in those compressed leisure markets that you've seen a little bit of moderation, so they're kind of in a sweet spot still.

Speaker 16

Fair enough. Thank you for the time.

Speaker 5

Thanks. Our

Operator

next question is from the line of Bill Crow with Raymond James. Please proceed with your questions.

Speaker 11

Thanks. Thanks for sticking around. Hey, Bill. Good morning. Tom, what's going on with the Japanese traveler?

Speaker 11

Are Are they going other places or I think I had read months and months ago that they basically decided to travel or to stay domestic. And I'm just wondering you're optimistic about their But has there been somewhat of a permanent shift here in their travel?

Speaker 5

I don't think so, Bill. I mean, remember, you had The Japanese government relaxed the restrictions on October 11, including elimination of a daily kind of arrival caps. Look, there's been a long history, if you think back over the last 30 years that visitation has Pretty consistent in even periods where the yen was pretty volatile. So I just think given the history, Given the cultural tie ins, we're not at all sensing that there's going to be any long term dilution there. Look, there was another flight just added today by Hawaiian Airlines to a 4th destination.

Speaker 5

So We think the second half of the year starts to show improvement, but really excited as we look out to 'twenty four, 5 and beyond. And if you think about, again, the comment I made about weddings, a lot of those were Japanese weddings. As you think back to 100 and 50 of those a year and I

Speaker 11

think we

Speaker 5

were single digit last year. So very, very optimistic despite that. Obviously, you continue to see the air seats into Honolulu, I think we're up 21% in the Q1 over the last year and I think about 3% below 2019 level. So look, we would hope and obviously given your vast experience, if you dig in and take a look, I mean, Our Hawaii story is just extraordinary. In terms of the performance, we've retooled the operation And Hilton at Hilton Hawaiian Village, the work that we did obviously at Hilton Waikoloa shrinking the hotel and at 50% capacity and we're more profitable.

Speaker 5

And as you look out, we fully expect we're going to be mid at least mid single digit RevPAR increased and probably again all time high EBITDA. So it's really good blocking and tackling, but We are excited to welcome back the Japanese traveler, and we certainly think that will begin in earnest in 2nd half of the year begins and certainly optimistic about 'twenty four, 'twenty five as we look out. We see that as a real tailwind for us.

Speaker 11

Yes. No, I appreciate it. Sean, one for you. I think it was Duane that earlier asked a question about handing back the keys in San Francisco. I don't recall you mentioning, but what is the perspective tax hit on the gain?

Speaker 11

And is there any way to Either using the 1031 exchange or a special dividend, is there some way that you would be able to avoid The tax hit on that?

Speaker 3

Yes. Sorry if we haven't made it more clear relative to we wouldn't expect a Exit per se, Bill, it's more just

Speaker 6

kind of a substantial

Speaker 11

The gain on sale.

Speaker 3

Yes, the gain is just would just trigger more distribution. It'd be more dividend is what Tom described, dollars 150,000,000 to $200,000,000

Speaker 5

Yes. You got to keep in mind, Bill, it's a very low tax basis. So with that, the forgiveness of debt, we end up with a significant gain. Given the NOLs, we can shield, but we still believe we end up With approximately a dividend requirement of about $150,000,000 to $200,000,000 Now look, you evaluate that in the context of the options. As we said, we're under our confidentiality agreement right now.

Speaker 5

We are reviewing and studying the situation carefully. We're going to do what's in shareholders' best interest. And as I said, all options are on the table and they should be on the table.

Speaker 7

Yes.

Speaker 11

Okay. That's it for me. Thank you.

Speaker 5

Okay. No, thank you.

Operator

At this time, we've reached the end of our question and answer session. And I'll hand the call back to Tom Baltimore for closing remarks.

Speaker 5

Thank you all. It's great to visit with you today and look forward to seeing you all at the upcoming conferences and travel well and be safe.

Operator

This will conclude today's call. You may disconnect your lines at this time. Thank you for your participation.

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Earnings Conference Call
Park Hotels & Resorts Q1 2023
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