PEB - Earnings call transcript Q3 2024 | Pebblebrook Hotel Trust

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Operator

Greetings, and welcome to Pebblebrook Hotel Trust Third Quarter earnings conference call. [Operator instructions].

As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Raymond Martz, Co-President and Chief Financial Officer. Thank you.

begin. may You

Raymond Martz

and quarter Donna, everyone. to Welcome Thank earnings good call third XXXX and our you, morning, webcast.

Investment our Joining me Executive and begin, Fisher, Chief today that only today's X, Chairman our before comments Chief please Co-President are note today is Officer; XXXX. Jon and Bortz, Officer. we But for effective and November Tom

materially Our and actual laws, comments federal from discussed under those securities may include defined forward-looking today. could statements differ as results

most of any For filings risks, mentioned potential recent a our for of SEC visit consult reconciliations today. analysis non-GAAP website our comprehensive and please measures detailed financial

Okay.

We have to so today, results. to let's move a lot quarter our third cover

quarter, travel by groups our In with not the outlook a quarter to and storms travel have leisure X.X% at were market continued gains the in weekend hotel of business report pleased would RevPAR share industry gains exceeded strong the despite line of X of with recovery are the our and our of on negative ongoing was along increases if properties. X.X%, this for occupancy normalizing our landing leisure named and properties resort occupancy squarely outlook. urban driven by impact and of fueled even third experienced properties, increased The resort the as hurricanes. recovery third transient same-property middle demand, recently RevPAR many broader trends. the in of redeveloped operating We several range growth both results that and impact our urban our at quarter,

specific growing largely redeveloped by share. a portfolio's X.X% in This growth X.X% properties industry's recently the outpaced markets, RevPAR RevPAR market impact the outperformance XX Our grew of offset growth our X.X%, spending, storms. renovated success and point markets. Total gain negative our our and trends highlighting by the by and is driven in These and occupancy out-of-room from X.X%. basis urban than the rose propelled approximate which strong increased of positive our strong recovery significantly more

of relating beat despite by AFFO midpoint $X.XX Helene. $X.X $X.X top Debbie was per and QX affected had $X.X to interruption factored outperformance in anticipated an approximate comfortably $X.X Our outlook the BI longer we after same-property property $XXX.X impact same-property LaPlaya our million our million from by of or million end We Adjusted Hurricane that middle expect. $X.X no to of in hotel restoration in our reporting excluded outlook to We're EBITDA storms, to X even named range, midpoint outlook significantly to adjusted important the most proceeds million, surpassed it we Hurricanes proceeds by LaPlaya was $X.X the in the is This impact million our guidance. also while the million from by due the from EBITDA share Ian, business our $X.X million from which negative million. storms. It is the note an reached hadn't largely prior estimated following due fourth into Hurricane pleased absorbing and report that the previously Ian. which exceeded QX negative quarter, its

the urban active demand. strongest from weekday convention Diego benefited calendars, were These Boston. leisure Our cities travel business third San in quarter markets and Chicago, and improved return the ongoing of

quarter XX% late represents this in Additionally, a sustainable in the to last this Portland We're of increase occupancy promising recover market. beginning a showed that compared our same optimistic properties year. urban to the recovery

a grew by weekend XX.X%, X.X% a markets. by business and August XX%, X.X% to and strong Out-of-room a X.X%, in all early by resulting in occupancy increase in in Our Demand by of Urban Debbie Hurricane year-over-year September. recovery calendar in reflecting our more bolstered of RevPAR. convention leisure our by impacted exceeding properties rose of number transient year-over-year Southeast Hurricane to remained total demand were urban a occupancy cities. a urban significantly Urban and in Helene return spending at properties late healthy occupancy group healthy, QX. sustained increased travel by continued X.X% weekday in

Naples key our trends very that grew encouraging of by weekday reinvestments, While and physical LaPlaya group allowing both Beach bookings A damage, properties. These occupancy lead specifically. report group and and occupancy of historically leisure making growth in more that occupancy before share. hit, over the in appealing XX% despite was both Southeast by and to segment weekday segment to a named benefits highlight resort's climbed Group -- our which the reaching market capital meaningful same-property by to XX.X%. surge Business gain driver on specifically, led by demand, our they impact note Resort and the X.X% X.X% reported important X.X%. to resort a and significant us storms, explains in the of increase modest storms weekday the Resort are cancellations travelers properties it's reduced broader guest after In occupancy impact a improved year-over-year, our our

demand bookings, more revenue impression and typically property EBITDA declining ADRs, of beverage at segments. given and room a the Business potentially particularly in per food occupied total at and comes and substantial transient frequently ADR our revenue, segment than the While Business Group out-of-room Group lower resort drives weekend generates leisure

the our a same-property compared X.X% year QX, of prior Group resort due mix ADR higher in to bookings. declined primarily by period, Business example, to For

This RevPAR our in normalization on reflects overall group, X.X% weekend X.X%, declined increase mix highlighting higher of our by grew a room XX.X%. demand of Business in total of resort a X.X% the same-property revenue nights XX% also Across This quarter. of group increasing in resort in revenue room Group the demand higher Leisure year-over-year demand resulting Groups about transient quarter, by higher accounted appears of and for impact with contributed international portfolio, increase ADR, only this to business shift bookings stabilizing. well third with than group mixes total Express like remained portion the customer wholesale to markets. X.X%, X.X% American same-property X.X%, the leisure growth as the Business Strong Group of from though in up alone. our the strengthened as ADR firms total partnerships flat. significantly which by and RevPAR roughly nights the year-over-year ADR, driving revenue demand revenue improving also specifically the Excluding ADR for Capital an in consortia same-property through One portfolio resort be supported with total the across was increase room case.

below However, pre-pandemic international still inbound remains levels. well demand

decrease to results. Total our fixed focus positive such same-property cost profitability, increased same-property with X.X%. means quarter. cost occupied and while and to in just departments occupancy occupancy the expenses are third as before reduction able have per costs we hotel This efficiency intense total by to room, again, X.X%, up on by same-property X.X% Turning continue estate expenses by hotel taxes Year-to-date, across real grew all yield insurance X.X%. increased expenses

Our benefit has and effectively aggressive including XXXX us These practices benefits. efforts to inflationary cost and efficiency approach beyond. anticipated position relentless continuous mitigated and pressures well best and wages wage and in manage pressures, to

completed property Hotel next in performance continue the this refresh c we Regarding September capital rebranded with XX be The in of million our September, brand QX. already expect significantly Centric first and expected Hyatt property to on investments, Delfina impact $XX as into Santa quarter temporarily Monica the disrupted to year. and a underway we transition

by in we provided marketing the the brand, will of across as a this However, fully into to Hyatt, Hyatt $XX Net strong portfolio million new projects awareness we $XX year. capital system. customer our realign integration million money key once this expect invest and with Hyatt embedded drive to believe rebound programs the we

Over our redevelopments repositioned at the we completed have last and years, several all nearly of properties. major

dramatically our market millions position. portfolio's quality hundreds dollars of invested have properties and enhance to We of elevate

from We're While upside to incremental majority recently made these many already seeing substantial and the our of we've of the redeveloped quarter investments, properties investments during with realized. remains already be outperforming year-to-date. returns the

expect continue up to performance. ramp We properties positive this further as their these momentum

significantly is poised investment next Now that complete, few major capital CapEx largely over we're our years. the program for lower

water September as LaPlaya, in Hurricane Moving damage detailed we the Helene property Milton on our experienced and Milton on press restoration resort from XX The Hurricane XX-room last resorts release to XX pool the Beach ground due week, complex. the of guestrooms surge, the and damage intrusion from building October in sand House affected was floor primarily approximately on to storm X. and

resort, the Tower damage. the including Tower, house and XXX Gulf of majority together sustained the rooms, Bay which Fortunately, minimal guest

team's our capital the the fully time to third-party investments before nearby, Florida properties damage reopened Thanks enhanced report restore LaPlaya first extensive previous Bay November evacuated operations to positioning And have X such Tower on able cleanup and ever needed including Southeast on pleased in that other events. October efforts, their reducing repairs Our were the after storms. after resilience, Hurricane in storm Gulf and Milton remediation Tower and significantly we're day to and X. after to and minimizing immediately being We the preparation begin team we closed. a closed our

months as of are upper to new of end the year. the complete pool in of few reopen first between as floor by to and We floors year next targeting ground now reopening soon also targeting House the arrives. and the end our of the next the equipment pools the the We're quarter guestrooms Beach the

these construction and achieve to materials necessary timely delays FF&E. deductible. governmental chain approvals upon cost receiving avoiding work after for in is all covered be repairs and ability will by restoration manner based these Our for a The and targets supply insurance

in fourth these we part LaPlaya reduce the same-property a negative and When decrease adjusted numbers that of impact EBITDA for Please outlook property total $X.X RevPAR adjusted our estimate that $XX million hurricanes QX exclude from for the this which XXX resulting to to note estimate AFFO quarter same-property points, we amount. Helene in QX X be of is including basis Turning LaPlaya, Milton LaPlaya, approximately XXXX, revised and hotel Hurricane with reporting EBITDA. by this same-property about our year. will combined the the same million of million impact in $X.X on accounting not in

Hyatt leading transition XXX in EBITDA. the same-property RevPAR by our reduction that approximately hotel to $X.X a points, will brand reduce Centric million QX estimate also We basis

EBITDA and weather to of not slightly to be stem the Washington, final impacts, the million seems a markets, weaker-than-expected our in demand up. had Boston have worked our and a to financial QX on debt strengthen on transient than election to and reduce from X% balance sheet, million rebranding issuance to as October to weaker Most 'XX attributed completed our XXXX. appears several significantly more in of $X priced now $XXX successfully same-property loans. inaugural XXXX, week senior week QX We position would if November, RevPAR including previous Shifting bank L.A., and X.XXX in of of our travel the of October San 'XX presidential urban for proceeds our is outlook first The used reduction maturities. X% term elections. we impact and these our So the softness extend Francisco, we've significant maturing our outlook notes D.C. actively attractively unsecured On X, remaining to

of announced majority loan Additionally, bank XXXX. vast extension on our the November we remaining XXXX the X, of term to

We million to facility our also majority XXXX of unsecured extended $XXX XXXX. of million credit from about the $XXX

information debt to As significant a and in until well with period no industry update, our And to to rate pandemic. our monthly a the like the of pandemic improved weighted average we the of as back made decision updates result during of debt structured comprehensive and We expectations is update our continues to portfolio with we XXXX, And initiated the the details industry John? hotel the significant future. these monthly during over X.X%. normalize, uncertainty a on both provide our stability results I'd Stepping operating to our and to hotel signals portfolio. refinancing just finally, December and rapid John and our we these interest our of have that during the shareholders the efforts, the these call updates operating change. confidence maturities timely for provide more started from discontinue turn to

Jon Bortz

for industry's the the start significant insight Thanks, from performance, some and a of industry provide for of our thought share high-level both thoughts on I'd I further XXXX briefly some then and highlight the simple provide Pebblebrook. some gains Ray. redeveloped performance, properties on with evaluation our

office business grow So Leisure continued let's little transient more continued the demand industry. start a Business QX, to demand Group return demand as recover and with to improved. was to patterns In complicated.

healthy, it remained the international boosted inbound was overall leisure This demand due in While Paris, year-over-year. the roughly to by travel flat pandemic. outbound outpacing was Olympics recovery partly the following

the particularly suffered as normalize. the to most the return has pandemic cities, the during leisure coastal demand demand In addition, industry cities resort of negatively that overall demand historical patterns impacted

diminished flat before. performance compared the income demand continue mid- of and the across these after pandemic-related in most industries. XX significantly months. economic now comments a our noticeable patterns along support pandemic see aspect impacting STR segments. normalization remained have which pressures where similar believe is and of persisting companies brackets, lower in support end this outpacing of April savings wage favorably to with positioning healthy the solidly challenges, We've this the year. stronger this in winding difference personal XXXX. this hotel and growth, year, upper out, least normalizing that last credit financial trend created at with strain. inflation demand suggests and in lower-priced price governmental this to segments and from due and have should industry over largely during many rates, has for high data individuals that talked This remains reflects a inflation, provide the We also have is income card to changed despite has from industry largely The down, a increases are other We unusual The GDP group interest We added to heard about perspective, XXXX. we've Encouragingly, has the for been better is lower at since strong employment demand phased last believe occurred

GDP to supply expect Assuming extremely growth. next remaining align growth are result in continued we this XXXX limited, growth, in economic should With year. economists growth with as healthy occupancy better healthy most forecasting, demand

For Pebblebrook, performance, and year-to-date demand by we're results, as XQ evidenced following factors. industry's to the our flat not several thanks

in positioned them upper luxury all are challenges travelers segments. more less in by impacted by segments, the making or properties our faced upscale First, price-sensitive the much

bookings regain occupancy portion of leisure the significant resides with markets business significant returning group that growing. a urban to transient demand Second, and portfolio in our continue and

redeveloped previously displaced year's regaining renovations redevelopments. of also we've and in we're was the few share And past over occupancy most gaining Third, fourth, we're that by years. properties last market the

convention the step market offset and quarter Angeles the year. doubling year, experienced However, in Encouragingly, to life have was more primarily third Portland, urban of governor city. the past future is been has Group drop Three were our the San pressure year, including negatively markets, to production had for backward during certain seeing so Los this should Business and for on Los that strikes in negatively a we in Francisco, headwinds. incentives begin in XX% as different different demand business to year, this San faced to leisure all impacting year, next by Francisco accelerate financial a expected the transient, due strengthen shape production all but currently Portland's performance. strike affecting in each increases that occupancy, this faced even Portland summer. years. and return, better headwinds announced due decline recovering in-house are business and reasons. slower in for up gradually, trending a year demand took And Angeles is recovery putting significant just reductions of travelers and entertainment significantly rates. entertainment this more than We're L.A. next last the convention we're encouraged industry be significant to calendar that albeit quality trend and this exacerbated to challenges pandemic. a potential

have implemented been cleaner local promote have safer to improvements city. there as noticeable However, policies a recently and been

combined The markets demand RevPAR in currently full and Combined, and with the year. third will robust forecasted markets growth urban significant for they're RevPAR and this the Chicago in these recovery a markets bottom market's particularly forecasted indicated, year. achieve a of $XX.X the Diego In QX, year-over-year quarter, these from present a year. $XX for Boston, X.X% third is the X.X% we've we're Combined grew represent year, Portland's properties EBITDA declined more combined Ray to a over expect for million three and X.X% quarter, X to urban for recovery of EBITDA San business million in by we the this this X.X% our by X in these As ahead. decline increase year. XXXX in contrast, decline seen forecasting full

a cities cities. contrast in the should next slower recovering slower and become our XXXX recover a even quite no So We drag beyond. urban between a faster that the on and be these markets year three performance recovering later and should to anticipate tailwind and longer

which addition, portfolio, let a benefits in few properties from And gains me share redeveloped expect our In we substantial our XXXX. examples. recently achieved significant have market throughout provide further

have Francisco year-over-year harder In XXX Hotel of San Hotel and conversion to of into redevelopment the makes share, generally San gain it very Francisco. gained Hotel the RevPAR point year's in a Francisco challenging quarter San previously and points X,XXX points about in which in Gaslamp talked Hotel another quarter, points third We is X share last basis X,XXX Vitale market, Diego of X over gained basis X,XXX it's year-to-date. top Margaritaville over the on basis third San This gained Quarter gain. over X,XXX year-to-date. the basis points and basis

by could basis year Mar are RevPAR years XXX Court points gains year-to-date. Continuing Harbor pandemic. Boston La D.C., X our Chaminade over Washington, Monica Resort of following our basis in the on, the redevelopment. Island Ziggy to RevPAR gains redevelopments Francisco significant points. go quarter in you XXX Harbor EBITDA this typically XXX Hollywood, showing basis of its first basis Cruz Del QX gained but Santa open interrupted points in and and to points just over San Resort in next share get gained Spa X and and has XXX Hotel strong over was far. RevPAR year-to-date. all points drive the particularly X,XXX growth points. each markets. over will XXX idea. in Westin of Properties takes Newport Jolla I points prior so Santa points. years of also year. I major few L'Auberge as in ramp-up basis gained basis almost limited RevPAR no share Estancia being basis & Zena gained over over XXX its supply Hotel full X,XXX gains points West in think XXX from basis gained in over gained over years over Viceroy redeveloped with growth Copley this in gained basis

for Looking to year. pace for encouraged nights very ADR continues X.X% ahead ahead are by and last nights on-the-books be currently XX.X% transient, XX.X%, resorts. up are year X.X% group pace next by in with total same and total particularly year-over-year, on-the-books with XXXX, to They're currently ahead group group by year's XX.X%. forward rate up next Group room by ADR combined our X.X% favorable. total portfolio revenue on-the-books group with compared the revenue. time to X.X% up room by ahead room in by by X.X% We're XX.X% nights, by at our group revenue and in When

are redeveloped leading pace. Our favorable resorts this to way the

out very XXXX, As significant positives. to several look we see we

urban growth urban tailwinds expect in up three headwinds turning our XXXX. markets set for First, our we markets continuing in challenging other into with

Second, growth our share expect properties. from we gains significant redeveloped ongoing in

return next level expect leading Fourth, overall higher its a growth with benefiting and as international GDP believe to will to markets. growth the in we inbound outbound a believe the will of supply likely relationship cities growth, demand continue. leisure further become hotel that the begin to year of growth. very we industry historical tailwind, returning demand normal will business transient business it's recovery outpaces and versus continue the should low Third, travelers to trend occupancies group Fifth, we urban

of all it's relatively course, this growth, with Of consensus economic of a forecast. consistent the assumes normal year but current

our address completes prepared So now questions. happy that to your remarks. We're

with you may So Donna, Q&A. proceed the

Operator

question Please Fargo. first of coming from is Today's Kesten Wells Instructions] [Operator Dori go you. ahead. Thank

Dori Kesten

EBITDA do early, you're let the a able be but be Thanks, might original should And think year? expectation us know to million can at next just to change good exceed that so It morning. less bit to what may impactful? you $XX this able property be you future year's do LaPlaya storms

Jon Bortz

the I think to out, It get Well, say, the appreciate be qualifier. little be if should where to with we year a successful for couple back reasons. is but bit time your Sure. expecting this would laid for to schedule that a do we're we able I line, we early, were of I

we have sort more more coming is in group pre-hurricane on with books First lot of year, pace. much in fact, this line a the

club the to there, growth that continues to the Second, and add property. grow to continues EBITDA

sorry, I line of scenario for So do meet that that's provided the we second think time laid out. a I'm the year part reasonable we've was your next what question?

Raymond Martz

that enhancements we... On the

Jon Bortz

sure. Yes,

from of kept They're that way did from into temporary in of lot in a this We Systems enhancements floors. proof hurricane We've Beach come rebuild. the Beach a sliders the side. did on storm the of some in in So on of are ocean meaningful surge Dunes We and the water flooding Bay that. around part as the have caused water, the upper did are like side. the other House the protections go a out to least House storm at beach. after from in on we getting added streets windows bunch side the and We things that second way. Ian rebuilt

damage limit we've what we a speed work and done next some storms. anticipation of kinds advisers of lot season hurricane to with And insurance and both will can and year's property out a between think our we storm so things we impact we've the of laid will do and permanent the recovery. even dramatically about plan further And now from that do that other that in mitigate temporary with protections providers

Operator

Kornreich coming question of is Wedbush The Jay Securities. next from

Jay Kornreich

details hotel leisure being rate specifically pushing comments looking more Just from resort? for really going able outlook at as provide the expect to to promising what you Can start XXXX some the you more customer the the to your on back and much industry. just

Jon Bortz

we've of demand up. to mean think is of last we months the XX sort rate say post where sort the will hard It's normalization this customer process in I are leisure to peak pandemic where XX through average Yes. gone over with the end XXXX. I following

Ray ahead on add I mean, we group year, we rate think we're coming explained, and in I as as our at next look rate. group, group into

we're going We're event should our more group our in added Now to we meeting we've rooms lawns objective. to facilities where yet be do next the resorts at year. and and these back mix other to not That's drive pre-pandemic. And also additional properties. into used think that we group

I are come. rate do and wholesale we're where So the don't ADR further, it, some from average leisure as to point. stabilizing we're think where those occupancy international build of guests which know come will And on customers some this posting I terms for at lower-rated of we in generally does charging that continue what or channels.

some our and I we'll begin occupancy high weekends again have particularly holidays redeveloped. doing that a been compression, of rates grow be as to have position and in to properties, at more more ones get think we're the

Operator

The next Rose question Citi. Smedes coming is of from

Bennett Rose

sort little prices you growth sort just you do year for growth moderating? about that think next Or and what ask to now? wanted you're I and wages overall cost of thinking about bit right benefit or about a how of

Jon Bortz

work the with preliminary first our teams teams. begun just our operating properties, those just to and budgets starting and from budgets are proposed our Well, to work or receive Sure. through we've

it's to it's going little tell you all come out. early think a I to where

last a think perspective, of wage going the philosophical the sort a I as lowered were slightly to think overall. I increases perspective, year be they general given lower than are the average inflation rate from

markets to that think throughout applies overall is are I union are come in increases you it most going which reasonably employees it being already to be in drive for or losing I soon this And that there to, apply. markets larger, think still either will is fall hourly many going whether at to under arrangements the non-union, to bit In portfolio, those because workers the the to the our new tight in risk think So a labor think risk union relates employees take applies and little are or to that point resolution, those of those those as going likely want either the agreed markets. to I as your CBAs of unless where up you're union unionized. you're number or positions the cases, to most I really

properties our agreements. So typically follow the union non-union

And I so think average in than going a that, resort some markets going them, of on have result cities, in as the markets or higher increase the any to secondary of general. a to the in we're of have in we're

Bennett Rose

I'm was increases of sense where union question just have you you a -- looks are it wage just as My but like guys percentage. what And just was, have I wondering number sure a in, if them if you coming I'm kind contracts a of of settled. if by wondering year first market, it varies a sense are the of are getting

Jon Bortz

markets Yes. of I we're and I in because have to pretty our mean idea in a think come where some those good have the properties. we agreements apply they of

the market. -- varies I by think it

this in at -- offsets at other of really and what combined these is of we're to are of be and relate for at wages benefits a point. think the each averages credits that we focused -- the you that don't since have have many misleading, other basis, I point this for -- on properties that either to we going -- are think our or on giving what all reductions I and a would there number particularly markets be they probably categories

Raymond Martz

other I represents costs subside. Smedes, lot about certainly, down of we've XX% our the that seen the over And or significantly pressures so wages cost the overall cost. years XX and But last inflation mean, structure. benefits important an it the so of are part input a as are of other come XX%

becoming helps and pressure. we're other on coming are technology enhancements using pressure less many And cost of lot take costs expenses. are In out less a food are Energy beverage So the costs the inflationary cases, and negative. turning the costs. down, actually

wages and XX% on benefits and because are savings So areas over -- in. overall that part a an the we of other cost focus of control a But important lot lot certainly, we have the we can can we have structure. it's

look So at the the whole picture, I not that's component cost. why just one of

Operator

The Markets. next from is Klein of BMO coming Aryeh question Capital

Aryeh Klein

optimism how noted Portland And San some West And reducing markets. exposure you the on from I'm wondering largely dispositions rank struggling standpoint? to L.A. in and the a Coast have you Francisco, markets. then urban Jon, stack focused longer-term of

exposure? tailwinds, you Given existing on with the comfortable your are the view

Jon Bortz

Sure.

instead challenged is in What markets some seeing these that's representatives get cities we to quality after more is I once progress practical too suffering. of think we approach reasons lot why change these in challenges they're the I get going of and will on many that, by we're on issues. that they same encouraged while be were past those pandemic had significantly a these the that So more fundamentals our different of the election, underlying of of it moderate the because the for cases, created business-friendly, view think during a is in successful before industry, in about life resulted in little think a markets, much reasons that pandemic. these San in so entertainment L.A. elected. they Portland cities what's Francisco the I the issues successful of thrive and made another a And policies is, addressing the pandemic but L.A. themselves just their cities further the and

to the drivers by all the And of So in base they continue of of fundamental the we're economic cities beauty We're Sporting these et -- activities, restaurant has the remained continue that encouraged and weather, scene, up, activities place. base pick the in educational cities, those cultural be markets. those the to cetera. remain, the systems, encouraged that.

with we're they're these comfortable long think I in We're disappointed it's surprising. So obviously the cases, in rebound not some And markets. how in taking.

there there'll in stick think going hockey backwards turn at markets, these things to year. Obviously, it's went but which they point time this take I we've a to not past said markets. be significant become yet. these around We're

advantage we in of a active active that's market, the the the going in those mean, capital of we coming I that more recycling underlying opportunity our is continue XXXX. of portfolio What at to repurchase discount take be and to to a position terms our to markets, in to assets. try need dramatic transaction to think value In we're

out there's So come policies come this election of election. and with uncertainty what going going this to what's to of course, still out are of

does, And this in see recovery these if markets transaction so what we'll in that anything, markets. to the

Raymond Martz

you, to and a Francisco, to more of Portland, markets Aryeh, Seattle largely San And XXXX, hotels like leisure capital the we've markets distribute in since the and in and some lot Coast sold remind more East in West markets we just Coast. that XX

make the has XXXX, some changed portfolio since and progress continued we'll So in and we hope XXXX. expect

Aryeh Klein

And then maybe unrelated kind a follow-up. just of

something happen quarter. unanticipated? before obviously, knew that the conversion was Just there this impact. on Because Did Delfina that about we

Jon Bortz

were the we knew XX. Yes, we September that brand changing on

We expected that there would be significant disruption.

all changing the systems, property. renaming You're the you're

getting to helped You've the guide all got the Obviously, OTAs, very everybody. a review to work with and sites, significant changed. had focused property property things that Hyatt third staff was those on parties,

things and of place a We we lot those just Some significant during did it's it this are than the But outside would be of policies just more disruption, what significant of put anticipate fill all lower disruption. try to to out in of thought longer. takes we two, that to rates us be. at it turned control even of

first a course but of quarter gradually the to fade over away temporary the continue second should think It year. quarter, and of thing. this it's quarter half more significantly, of latter the next We the

Operator

ISI. of Pfennigwerth Duane from coming is question next The Evercore

Duane Pfennigwerth

thoughts scales Jon, it, you on or have like months. potential? think optimism biggest segments wondered acceleration a do demand a what point finer some if plays chain put XX pickup. we on there's I your It upside the I see most out? if Which view you appreciate the could the sounds last could normalization pickup that over and see

Jon Bortz

a being But year. for connect happen. by things we've next national more than I that's can opportunities. travel this for little I travel led year. And travel profits the forecast business a excited question Well, level, think that's we're address has extremely business to we very And world for just side and week, The business next few are on think guess I to investment encouraging group, in continuing a from And but side. on growth high the say transient world had good potential the year. I increased perhaps clearly, recovery the I'd election. detail. the business challenging think the favorably for They're business healthy profits certainly or And very responded by this

So travel business I next think year. acceleration in we'd be encouraged by some potential growth

that, demand stabilize next perhaps side. very to the begin the The But some meaningful again, guess, normally the to a significant I see we'd leisure that that is leisure the return in happening. be the opportunity and international rates reaction normalization to be excited the think be markets increase inbound, increase the dollar, and to of year I in headwind think could about and I excited final the we on election next would of year. of

maybe international assuming to short-term get end on currency lower some that over with and the us hopefully, Fed the we time, continues help recovery. stabilization see further dynamics begin So softer inbound we'll particularly rates the curve, to would if of some

The other greater be enhance expectation. that of we see speed to although people visas, administration thing is a to the might at part the getting are on unrealistic an effort hope would the which

Duane Pfennigwerth

markets and it's the but your needle positive, That's X- XX-year the just attorneys, or it Prop you perception on to this seems move certainly of and directionally long helpful. X a of alluded changes things mean markets some of to X? the is How kind you take of I I change than phenomenon results? district will a of more mayors, those for in the it terms think XX. do changes And then think lagging in to, the

Jon Bortz

long to I'd that the cities, dramatically XX-year. the the is side the for condition not the because Boy, improved. like truth to is the cleanliness, shouldn't markets, X- these on Yes. reality think good safety take the a I out come the of it's It news think in to ground

better there I XXXX, is it go when we certainly was Francisco, in I In was were think in it than Francisco condition fact, to when think San 'XX. San for Nareit I back,

think that to dramatically out. We've improved. working so try been And I news have get things to

I to have that anything, people good there's it is perhaps getting a truth driven. think to a like And that happening. is narrative there the Sometimes I just and what's experience. it politically takes been takes competing think see But

have people San go good they experiences to Francisco. convention think I when had

I think go they experiences there. good they when leisure have

indication Court think that's think And I the think has case I people staffing of mean, forces, on for policies law the that's, police prior improved, perception. in and go the an Portland little in the there live do as a change elections, enough in much It's the had just And haven't who on. the California theft. return saw the encampments, addition again, see the think Portland homeless have to I a to again, I ways focus still that the ground on on you in ruling that Supreme I although well. worked.

are do a positive years. I don't that's So probably still X but there behind, think the extremely I lot things do will perception And I Duane, encouraging. takes think a of happening It's think follow. it about year

of years. takes a couple it think I

Operator

Gregory from Miller next coming The of is Securities. question Truist

Gregory Miller

the financial curious KSL's be an get of operations the update and hotels. all? Curator Curator I itself at performance on impacts personally to I'd as for a that thoughts number hoping your the if goals brief to you either Curator and I'm provide of with progress And think sale about and about aside, hotel and items Davidson relate your could or

Jon Bortz

we've members it publishing the of relates number as been number Curator, think I and partnerships. Well, Sure. vendor of to the

properties. would for we've that point And now certainly months, we're it's or And on I of on both behind where and to what sort sad our the because been X like in close time. regards, hoped or and the as don't think to some creator being industry operators growth goals Curator into so our either to and see for does, a have significant for we their quarters XX we there a it's to It's this be create the size because to I to you it's with so. and see partnering part in continue encourage the what continue cost the around effort money relates next And value would value us. it over it's take we but XXX done put that's I statement it's owners folks think to in verge time think probably the of significant can saver, or a Curator at, at save

Raymond Martz

And Greg. just to add to that,

is because necessarily the benefits don't you from see of hotels, what that. XXX-plus So Pebblebrook

contract part with not the it's hotels, the example, but an Pebblebrook and hotels. we As just a member Curator Avendra, new Curator scale of have, the just negotiated

Avendra because So the from a Curator we contract is negotiated. just better larger getting deal of

of those down getting. of one be going or will cost some we're our So rebates areas the

P&L but which pluses and on. they're are as well the pluses business that of does those because to the So It the it's directing overall several in doesn't marketing digital area making hotels, always efforts that's as an appear our help.

a service to reduce -- requests. new scale like to areas hotel have something need working an have a So as at bot company tool would used of a of to other with services. they pioneered We've Curator, be a areas. to be can that technologies tool, large That's couple the AI, a that before now as that. lot R&D new AI you the with well There's

for be AI can ask to could the guests bots or areas hotels towels individual done. use areas have and can requests other Now where

those more we're here. different areas provide to do if So here are belt we bandwidth have that our Curator these versus much able didn't better and under

Jon Bortz

any Obviously, And They aware to relationship either relates And Davidson private about Curator. KSL KSL as the well Davidson of well. sale what would found that I KSL it get our opportunity. pleased think from possibility a of see relationship were we the on the either We're that sold. both Davidson. that's equity with Davidson or or we upon executed the and know today, based with impact them they excited we group have don't

Operator

Baird. Bellisario Michael next of The is coming question from

Michael Bellisario

bit into with Or Jon, disposition. the you fund you're little match your funded you making back it the little of sales? in wasn't read with we progress this bit asset a stock Can that bought on a has view changed how but buybacks? quarter,

Jon Bortz

perspective. into you Yes. anything should it I from mean I don't a think read transactional

used get to proceeds to that will primary of the be I our source buy stock continue think that back.

that very dividend know, year, $XXX still our a this $X.XX cash or you so, flow quarter. you significant give as And are, or take. We know million generating is

the result we're effort shareholders our significant get generating. free to it's to that cash a capital So an flow continue back to of as

So again, our we state our way capital, allocate we continue sheet. statement find to the and with the balance income the of try to balance

Michael Bellisario

same ex know And along And do of when your any enough. CapEx San start need Diego all wave thinking any redevelopments that And the be then in that's next then point. spending about sort you projects? happen for hurricane might me. dollars maybe except spent? those the But 'XX just lines, one for might I of Fair some to largely that in initial expectations at are done,

Jon Bortz

Yes.

going hard portfolio. the a next news some use think address projects the capital, the of -- the of lived from I on There one upside but Point. and just out already major projects, ROI as for first We've deferred the aren't investment. to everything small news, We've there of remaining. But of we've portfolio and through and ROI is additional the we're And again, portfolio isn't the There is that. in the the already at I'll we've in part. are assets. capital dollars. projects, them, way, that's I the energy, the of opportunity because had there side that So better things what's where is left ramp-up disruption, some sustainability, good gone potentially part. Paradise through another invested the done. gone small redeveloped there's it's ROI There And the the group door is has the smaller nothing like said, that. wave projects particularly that, a really be the pretty in know But that mean are acquisition further I not our major we've no good I in I much always projects. projects. mean, we've There's of been

we're about over to have the So we're we have years or material few move years. the fact disruption to going and any feel not the organic we really as growth forward that the that X good next we where next X are, going over

Raymond Martz

CapEx the this about is think then you -- again, as potential. beyond, the Michael, uses Paradox Point And in ex 'XX and

in rate. range refresh always a $XX going a have than years a We'll that is Something of CapEx couple light vicinity, for a touch. X, may we the last or But there which to that's in that's is have million have years. less out run gone the done a that million $XX to on property those. that here lot XX We're little ago several due

So there. think to that's one thing about

earlier, Ian, less to noted assets. made when investments including those harden was not sort of this BI, in be made, going cost relates any to you is restoration, investments what good and going we there, is million of these because or the of add This it that we've the much, range. and the the that Southernmost As between lot Ian of disruption. as LaPlaya $XXX news the $XXX to because hurricane we've to impact losses capital was is much the be million, a near the

here going which to dollars depending there, significant. few much outside deductibles, covered by be a it's how So on -- million that's again, of And insurance. these allocated, less paid are by or our it's

it's but significant. on that, effect a lagging much there's less So

to Beach running. eager the House we're and get So up

and just started. of For the it's getting waiting us, getting some permits. We're

teams Our ready are forward. move to

probably good and of a should really quarter, we So end great, first expect certainly the by look the should have we 'XX.

Operator

over turn to to like the Mr. Bortz comments. I'd this time, closing for At back floor

Jon Bortz

your Vegas New you world, time then not thank the for and things look going perhaps after too your NAREIT to seeing and on in long in of we of you the and all Year. participation. many Las Well, out forward Lots exciting for

I in forward near holidays, look hope future. your and to you the we in enjoy So touch being

Operator

your This event. gentlemen, thank and today's you Ladies for participation. concludes

day. log rest the may this and You your off disconnect the enjoy lines time, at your webcast or of

Pebblebrook Hotel Trust (PEB) 8 Nov 242024 Q3 Earnings call transcript