BHR - Earnings call transcript Q1 2019 | Braemar Hotels & Resorts Inc.

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Operator

Good day ladies and gentlemen and welcome to the Braemar Hotels & Resorts Incorporated First Quarter 2019 Results Conference Call. Please note today's conference is being recorded. At this time, I would like to turn the conference over to Mr. Jordan Jennings. Please go ahead ma'am.

Jordan Jennings

recent to Resorts to of for to you welcome Braemar results XXXX and update & Hotels the on morning today's review call for and Good developments. first quarter

results provisions unknown to being Regulation. and forward-looking statements made pursuant assumptions, factors are which subject safe has yesterday risks remind known a based be those the the in On the Officer; conference by could Eubanks, differ a the statements Such more Company's conference the statements accessibility uncertainties well in been the Officer. this of Financial Internet Chief and forward-looking Securities and numerous was of that The actual conference materially this Stockton, to from to are Operating anticipated. on or These Federal of me and covered or Jeremy harbor Chief results, upon financial cause the Chief this release Deric Welter, Richard listen-only is Officer; The discussed in call Company let obligated to of or and Executive the distributed not update revise with the them. President this are and as you At Commission. media. are were are information the basis included call contain this will the over press Exchange certain forward-looking assumptions today call as call, Securities time, date in publicly only filings notice call made of that fully

is of on XXXX, which X-K filed Company's review Stockton. to turn I which in in all with ahead, this together tables Please Company's have Form in to call Richard. through been addition, and non-GAAP reconciliations www.bhrreit.com. earnings the call information or used measures, accompanying the are In the provided in over also release Richard Xst, other the at release. will encouraged those SEC certain reconciliations now schedules, with provided earnings financial Each maybe May listener provided accessed are on release the website and the terms go

Richard Stockton

joining the Thank January Good a in with for of realign the that of meaningful agreement concrete focus time, our announcing hotel and investing non-core announced two the to and to to selling have properties. acquiring Since our the a segment. brand are believe making you taken to lead this revised luxury an first strategy morning. results. forward. luxury to strategy growth will execution us quality XXXX, financial In we properties quarter continued we including the steps portfolio and properties, going performance strong four strategy progress two up We're solid excited for high we about of Company discuss

on current this luxury be Periodical that segment had segment has Our greater has RevPAR of strategy the shown over the to evidence of performance by hospitality than continues market lodging focus segments. supported term the the other to the long segment. luxury growth the

to term outperform luxury, Looking to consistent other gains expected continue forecasters sector RevPAR STR the predicting thesis and we ahead, be are and these and growth with the outperform aligning By economic continues favorable the with Braemar long our REIT in for believe luxury to platform outlook clearly our well on trends to modest XXXX industry. peers. our for capitalize positioned this is segment, the

accretive be this a or Inc., and year purchase growth. with competitive Ashford year. ERFP key arrangement potential up commitment. two The Program up ability advantage moment term a our funding that highlights put, program our to to $XXX has with sized Enhanced us January we the The of price the announced is one to to Funding ERFP Simply to discuss Ashford qualifying based I'd to funding to of a Return year the million programmatic like upon funding contributes Braemar operational Inc. mutual that's with $XX in advisor This significant our commitment turning Before a agreement. and provided maximum meaningfully acquisitions results, take to facilitate XX% provides performance. to of of agreed million the renewals drive

space of square the ability XXX from will our funding points returns feet consists of Ski the this a meeting XX% of our Tahoe. differentiator mid a XXX This Resort. anticipate Northstar of part to acquisition as the will ERFP over with on ski to We unlevered ERFP landmark to to ERFP to million the mountain acquisition receive the We of work slopes acquisition. projected outdoor put points $XX shareholder ERFP that we ability immediately January future sits with unlevered XXX XXXX approximately XXXX to With our of and basis add returns indoor will on Ritz-Carlton estimated and in be rooms an funding IRR. our the acquisitions, this hotel value. built increase key basis luxury Lake XX,XXX program the the believe on increase XX% behind hotel Braemar

acquisition, optimism XX.X% season over our MLK excited year of expectations. weekend. quarter. season winter Early end the first growth prior significantly in to quarter snowfall created the and rates on This the led and While tail the of that RevPAR hotel's the fueled strong higher significant exceeded about this performance were drove very we over already holiday demand our further

Let me to now our first turn results. quarter

the quarter, significant of RevPAR RevPAR hotels a hotels. RevPAR our first This efforts growth XX.X% dispose acquire higher the increase RevPAR renovation X.X%. are and to of all direct Comparable of lowest the was for RevPAR adjusted We per EBITDA reported during under result is actual repositioning for our grew comparable portfolio increased AFFO assets. $XX.X hotels million share For of quarter. and not $X.XX while quarter all for hotels for X% the by

month lodging the Our be sector. the continues in RevPAR comparable $XXX of trailing overall XX portfolio highest REIT to

Irma. recoveries totaled physical $X the to working to with we as our to the to seek the well related recoveries During minimize the which P&L recoveries insurance as property's our quarter, actively closely million St. through BI hotel Hurricane the in We're to Carlton damage Ritz impact to for insurers the insurance Thomas quarter. continue manage at both

We October least at through reopening our expect recoveries in XXXX. planned continue to

continue in with the our of the renovation be with also making are the Revival The and Francisco rebuilding in upgrades properties well as Both The Pennsylvania of hotels. We few is projects provide pleased including is on the track back coffered end bronze create Hotel at Historic will is and local original Philadelphia National renovation autograph of redesign Philadelphia its feel. combination opening City, house chandeliers, remain The XXXX as the prolific from The conversions Francisco artisans Throughout offices year. as designed $XX items autograph uses Center a a Courtyard will progress be to on legacy. featured furnishings. the XXXXs-inspired XX-story block Courtyard ideally and by more a Philadelphia stylish plus San progress million finishes property program detail to Places, be heart and and one to property itself is Hall of the and building Register plaster collection sophisticated, a we property Listed minutes. of the to prominently on track from the Hotel collection the planned building Jeremy well San converted decorative culture the Philip We're with also Philadelphia molding. completed unique Classical history distinctive Courtyard on Style, undergoing since as our dates with historic elements of the the summer ceilings, XXXXs. the the property to floors, as aptly on Philadelphia's an the rebranding the Center. unique marble architect expected from of decor soul the across official used notarial Notary boasting Notary Convention Originally Johnson in a named early and Courtyard using landmark in a City of to located and by city's

During the the was at growth at under we property RevPAR quarter hotel renovation. first while reported even the XX.X%

XXXX Moscone the fuel for conversions during our repositioning. the million center in spending only we continues remainder expansion in completed million an excitement XXXX. modest Francisco's growth XXXX to additional and Thus anticipate of San when $XX convention approximately spent combined Additionally, on with supply was $XX have late far, which upcoming these

several markets West Key by not our of front. the investors resort included REIT maturity hosted hard its our all financing less quarter Capital our been very we market our the of and of active of the markets only over XX% recent XXXX, as Lake On amount Ritz not a attended our of we maturity activity well of first March during management that assets. a teams. In and Hilton next April, the refinancing and until hope similar Pier on relations We peers have and of to do the last our the future. kind is year, our completed as acquisition well also in analysts. The but financing is investor schedule than other Carlton front, Hilton events tour we capital Torrey With representing was in House the properties Pines Tahoe. property, now We've and included very the also event attractive an

platform. continue this strategy great During to in on meet We attractiveness through XXXX. made quarter past of and of and to get our our progress to will strategy have the we to these the XXXX, road for out continue our communicate in investors with remainder trends advancing we the believe expect investment

believe the about Deric. turn excess over could portfolio the result unique of circumstances performance will broader upcoming in we optimistic I there now the RevPAR market. performance as in that several of the are We are call to

Deric Eubanks

Thanks Richard.

income a other first income statement. in As our of Carlton mentioned, revenue of the line which the we of the at insurance million the through reflected interruption until to month reopening and recoveries XXXX These to is $X recognized business anticipated hotel related October Ritz is we occur continue of to in as interruption Thomas XXXX the December which income Carlton Ritz for expect year. least of the Richard this February St. quarter, during hotel business

business a $XXX,XXX total Bardessono $XXX,XXX of quarter, the Yountville $X.X at St. $X.X million. Pier of As reminder, Ritz-Carlton for Thomas, a at we $XXX,XXX million the year and in Hotel at recorded House income prior the resort, interruption at

reported $X.XX. billion, La For and AFFO the net end Jolla the XX.X% of to partners Torrey we joint mortgage $X.X billion $X.XX venture assets $XX of was which quarter loan quarter. to a share. share of had had stockholders which the reported we $XX.X $X.X And diluted total Capital the Hilton for XXXX, on of share related quarter's Hilton attributable we million of million over million the $X.X our Adjusted per year growth quarter or prior of of common EBITDAre diluted per At Pines. loss we loans reflected first

X.X%. of rate interest average blended a had loans combined total Our

Our floating entirely loans majority caps place. in interest the vast rate rate are and of

end was charge As of X.X first and assets of XX-month our to coverage gross we approximately quarter, approximately the times. ratio the debt had XX% fixed net trailing

is not Our next until March loan of maturity XXXX.

Our restricted majority of of end and was for equivalents additional $XX restricted projects The $XX cash. cash vast is our an with cash autograph of the including the quarter at million CapEx million that cash earmarked conversions.

we have set XXXX. amount aside CapEx plan of significant So we a the in already spend to

the of net quarter ended million. $XXX also We capital working with

As portfolio XX consisted X,XXX of XXXX, XXst, March net with our hotels of rooms.

count our comprised currently common at results, In fully stands approximately units. and we of stock diluted with included share fully declared X.X is Stock. OP shares on first an of which annualized in financial share count XXXX per Preferred of million XX.X yield regards diluted shares Convertible $X.XX cash XX.X million annual our per stock X.X our Series million or of of outstanding basis. Our approximately an associated shares price. Directors $X.XX X.X% dividends, a to This B the diluted Board based yesterday's dividend on quarter With to share equates share million

loan we mortgage and discuss and a Torrey the the at $XX capital $XXX Jolla Hilton on and is interest plus an the mortgage closed totaling only Jolla, non-recourse concludes California. floating by for by LIBOR balance X.X%. + This LIBOR outstanding has Pines two I'd loan La D.C., which Also over five management our like The activities term. X.XX% loan secured the loan Hilton approximately the same The and existing with has the loan is provides it at to $XXX rate interest a million five-year La front, during quarter. remains with the review. now quarter of Lake million totaling markets On interest during new refinanced million turn a loan Jeremy secured Washington a hotels, term. Tahoe. financial The and to Ritz-Carlton and the a Capital bears year interest-only asset quarter, a we to our for

Jeremy Welter

X% Deric. during for our RevPAR quarter. grew portfolio the first you, Comparable Thank

X.X and scale the to X.X growth to gains portfolio's relative States percentage percentage of Our RevPAR points nationally chain the share led United and comparable respectively. luxury both points total

In impacted January March was in decreasing in flat EBITDA year first about XXXX. hotel government quarter occurring and of leading benefited less comparable this X.X%. shut revenue. addition, to to Easter the at April $XXX,XXX the down relatively relative quarter The later beginning February

hotel income the through robust. operating flow During was quarter,

increases However Ritz-Carlton incentive flow primarily Sarasota hotel Francisco at impacted property EBITDA Lake Tahoe, Sofitel management Philadelphia through. fee the tax San at Courtyard increases and Chicago, and Courtyard Ritz-Carlton

have to for Excluding through the flow aforementioned non-operating quarter. hotel in been close would expenses, increases hotel EBITDA XX% the

only percentage XX.X% rate to resulted growth RevPAR both but growth Tahoe Tahoe in XX.X% its Ritz-Carlton Lake quarter, month the January and last management, the Not our points quarter signs This the pointing increasing merchandising, occupancy As points from changes our expectations. by North a to share were Lake most driven the mentioned the growth class results suite on was initial early our strong acquisition, portfolio's and early pattern in X.X%. recent exceeding grew competitors ski its generating accumulation incremental RevPAR quarter. the and growth. conditions hotel's all to season. of performing first and Significant robust relative hotel The throughout was the during of began during XX.X luxury effective favorable the our Snow business Ritz-Carlton first contributed California asset XX.X product call comparable by market November to and premiums persisted best first respectively. quarter during percentage

in shift additional XX% which a $X.X rate growth. [indiscernible] thresholds grew or EBITDA from managed In to in results hotel Hotel addition, XX% property mix $X.X The generated the flow quarter. into resulting These margin. and million. redemptions group increase helped EBITDA successful reached a transient drive million effectively EBITDA XX.X% for rewards occupancy through an first translated hotel regularly

to RevPAR Ritz-Carlton to want quarter hotel of X.X top This increased Lake growth RevPAR were the grew relative quarter another XXXX. April After further growth performance In comparable million mention and revenue Pier point performing growth. the record of of Keys during from resort to $XXX,XXX XX.X% XXXX, represents Total Key independent growth of outstanding hotel $XXX,XXX House revenue the and RevPAR X.X Florida on in aided which led and West first the to to rate that X.X%. percentage X.X% first addition X.X% fees, occupancy the Tahoe, increases profitability asset, market submarket percentage the introduced EBITDA in in $X.X EBITDA growth The briefly that respectively. by or in additional hotel back had I setting XXXX, point $XXX,XXX in resort

strong to quarter addition pace the second quarter In is Pier the first experiencing for results, as strong House well.

supply we quarter, some the and the included new term two that from these us. in that the a absorbing this generator, a have Francisco submarkets properties properties be remain These renovated to During market, that of did disappoint did few Nevertheless, our we in however the properties demand didn't Yountville, in which two MSA. is performance - from largely San hotels immediate a confident long vicinity. significant continues drawing in reopened recently

X% we for weakness general improved our the share during down Additionally, our quarter, by softness, experienced almost to quarter. market X.X% due market Chicago primarily some with Sofitel we since at RevPAR the

the of almost Sofitel market XX% the tracking outperformance to April, For our share. continues of up month relative with pick

the this, in and general of Beaver X% quarter. RevPAR in new and at experienced front we To a saw summer will decline this very hotel. Colorado, Creek significantly central a Lastly, of have our Park spite desk strong renovation Hyatt We remedies building bar. returns including manager address new a guest in a installed snowfall these improved be will the enhance undertaking drive believe experience and lobby significant the for

street continue at continues XX.X% Looking to first hotel's growth be to above of market upcoming the growth in California performance to and Francisco chain downtown ahead, relative XX.X The the and improve San clip to Francisco, upscale comparable XX.X excited grew market San Francisco during we respectively. the the points the represents San and Mateo, as points collection. Courtyard tremendous San RevPAR its quarter. RevPAR This autograph conversion a percentage submarket about results percentage

The quarter, of Besides hotel under resort experienced XXX,XXX The are space pace and XX%. be nights completed remains of EBITDA work the the end the or on track ballroom $XX track its completely buildings remainder and During expected which the also XX% exterior done room guest of guest part between for first only Group these XXX,XXX Ritz-Carlton Guest room complete and all renovation. and The the range end to with on out of previously restaurant two a transformative will XXX%, first remains Hotel March exteriors of displacement currently the beyond the all changes renovation. expansion Construction XXX,XXX, the restaurant the what most with rooms, for hotel to lobby are to stopped occupancy of complete. is and the the specialty group growth up XX% feature was the coffee guests by pre-functional year. guest citywide about now complete X.X%, work buildings leading the hosting Xst an painting will was resort The by of also reconcept minimal opening building toward available. or Thomas XX% August. roofs are the not being gutter way. service of their room but and year on complete experience conversion The the track on grew rate or new XX.X% improve compression. with St. the during renovation. the the of catering grew grew the Hotel over quarter. concept, end at

the water RevPAR ongoing island Finally, hotel during and label a of EBITDA St. which feature Despite flow through construction were of XX% its rooms was closure at to of the robust Thomas begun new to XX.X% quarter. will on March, have of hotel able slide. XXXX less pool, growth realized Hotel kids than rebuild, XXX%. a on following comparable Currently the first a under in white operate the hurricanes. portion reopened has prior the we

to we XXXX, and new we group product competitive plan ahead, supply. of a our on when for see Looking strong pace capitalize lack

downtown renovation Thomas, autograph Francisco expected the to St. completed XXX major Courtyard In be lobby guest the renovation Ritz-Carlton guest early rooms remains June Courtyard the The completed comparable the addition decrease with resulted quarter time. first renovation growth ongoing in restaurants of back collection XX.X% renovations on renovation Philadelphia We be to schedule conversion to of RevPAR was during negative that be early San the are at out continuing June. occupancy. to the and to approximately order anticipate average downtown of on summer. of an The The the with completed room million. scheduled by impact of on and until $X.X end in XX.X% the in

eagerly I the months. Richard hotel's notary we now will collection a the few anticipate hotel in capital to announced, a autograph As investment. as conversion turn to

to net expenditures insurance million the to During to $XX capital in $XX competitiveness. maintain during XXXX, estimate will of spending we to be continue we total in in approximately order our year. portfolio invest In million

pulling Courtyard this to work make additional conversions mitigate renovation Autograph and completed Collection related while will predominately projects is of at enhancements to continue the to Philadelphia both specifically San the We be under Francisco amenity and capital the Ritz-Carlton Courtyard resort year. downtown Thomas order expenditures the which renovation Marriott's to forward acceleration of capital in impact of comprise strategic St. downtown

keys Finally, additional our portfolio. accretive we within have highly to add identified opportunities

Hilton three Bardessono. the Pines some couple Ritz-Carlton Specifically, next and ten Torrey two work Sarasota, dynamics favorable the we which the we at during adding improve years. villa of we'll keys portfolio Jolla at key Across currently be on are to the supply presidential expect at La completing experiencing keys

of X% markets under to supply annual growth. shrink next experienced portfolio's two X% over in excess two Over years. the this the We past have estimate annually our years, number

not of as unique necessarily portfolio Lastly, two our conversions number stories highlighted the will in a of we the the the note move stories I market St. want reopening result has to to I autograph broader Thomas. of lot collection forward. that RevPAR earlier Ritz-Carlton tracking the that a from performance

quarters growth, term I growth RevPAR are While assets over past portfolio will may it long these at few we hand times for forward. depressed we're the to Richard. stories going positioning now have for the back excited over how

Richard Stockton

Thank you, Jeremy.

to are positioned believe our first well We for Braemar growth strong with pleased quarter and continue is XXXX. in performance

for industry and While This and portfolio with of demand to us our investments the be muted, specific remarks markets concludes increased and our continues new will growth supply material remain continue prepared Q&A. now in should limited to allow profitability. our strong drive RevPAR to forecast call open we up

Operator

Tyler Instructions] [Operator Markets. today Capital again. come question first Our Thank with you will Batory Janney from

Tyler Batory

thank you morning, guys. Good Hi, everyone.

any - So have a I about or this from remarks, negative can during that Are so either but respect And wanted the you're portfolio? number your chain softness question seeing and first in you the prepared more concern some out quarter. in you Jeremy of addressed think demand? outperforming the are guys there worth about generally of know, the change obviously some luxury guys trends there's little in a scale portfolio you with bit a or or industry, to Richard your first folks perspective positive some pieces the in any from you to out for but probably you talk calling the kind of demand and moving

Richard Stockton

Sure, industry Tyler. same that question. through have. numbers think Look, we coming I that Thanks for very you recently see the

a would you I it right flattish point little market feels You generally on say that for the hit the and there. know,

our necessarily in very about. to for us be that's concerned on something going things many portfolio, so got we've know, You not

Thomas our reopening St. given online conversions etcetera. this year, coming Just Ritz-Carlton of

portfolio. got to are on the based others our zagging, potential zig So, composition just of I the while think we've

Jeremy Welter

especially the a amount despite add a that with I'd during we of market this, Philadelphia displacement Tyler, renovation. the tremendous first gained lot noise the had, having of we in quarter share

with we results. were pleased So our

Tyler Batory

very and bit target That's ask to and debt mean strong this I know, capital to year? about focus Okay capital performance your this on But, the stock then, how whatnot. any out, of little asset near allocation, year you given just have net I to helpful and you're you're update on far guys put a thinking allocation the too. management you wanted I understand so the great. gross asset the

Richard Stockton

Yeah, I think saying that you're leverage at we're target, in essentially correct our right.

acquisition, are if opportunities we extraordinarily sheet. make balance we're that's lot have an outsized So, of on seeing compelling your competitive. were out returns would be using cash acquisition on to to not just really see what it our the to And be based there. that's market The not We where available. - a continues intention don't very

So, as very be inexpensive. capital to debt our markets say strong, the will very we we allocation, look at continue

given for performance against available price I'm weigh But aware, need capital considerably. our us, share opportunities, you to has as that are For to seeing. the equity the would date, well we're returns sure year the we down come of that cost

consider only would raising be equity we to were any so, more to accretive And ever deployed if opportunities. it

think So, about continue how always I at how it, we've looking and thought we XXXX. that's we're think it, to now how about

Tyler Batory

Okay great. you. me. all Thank That's from

Operator

you. Thank

D.A. from Davidson. Next, hear Jim we'll Lykins with

Jim Lykins

guys. morning, good Hey,

First at you RevPAR Ritz pretty healthy the some all, Tahoe. of hit numbers

lagging should you about Just the how think going forward, on RevPAR we mentioned? snow thinking that about commentary benefit that any

Jeremy Welter

the on asset lot I'll the think one hotel. that. are really this agreed this things we in did We of rooms sell encumbered was underwriting the that, Yeah, this group was for comment not during discussions of shape. is guidance individual give performance, potentially previous great don't year but team I although of give asset upon for on really that think that April don't Ritz don't guidance. the and the because and Marriott Jeremy. owner of really renovating May a it had, We the We had

have of team with to underperform the of But can it term kind we kind short just I with. expect was working into group do going and nuance. best few something the the we're get That hotel. it the so, in because it's And - next Ritz-Carlton something so would to to that months, deal knew we of we least at it's just into to

Jim Lykins

Okay.

Richard Stockton

had and add you inches the to average Colorado year versus an of Jim, to snowfall. XXX. closer Just on XXX set snowfall of question this up

great And difficult quarter, for first comparable for XXXX. so it the while sets in it's been a us up very

so And going aware definitely to try accordingly. our to but we're we're bookings manage of that,

Jim Lykins

I believe if comments there also now? Seattle. there And your any with helpful. and was concerned markets the coming into supply footprint aggregate supply on Any right in just you're that's are other Okay, in

Jeremy Welter

the we you is supply and last This Yeah. Jeremy. continue markets isn't as maybe our robust a portfolio look it's rising our global as and you concerns at gave is where against, or and - down, and performance I rise see if coming are take track hotels been hotel compete we it to in the several years.

absorbed specifically growth we X%. forward over we've under over you look to within the over the folks But just a few X.X% our it's it's develop months, new going supply the the be months, when of decent in years to and had even portfolio we've But Braemar amount very six for hotels. new and difficult last being XX supply. So underwrite last next think

challenge. that quarter. your first The was a and did that that So, supply on seeing with as that a market a in we're little a then question But Seattle, impact of market and down has relatively certainly Hyatt the has basis, that go our that bit close on hotel well. come which forward to occurred been is

feel portfolio, supply pretty a about overall, it. to we good our look, from specific think I So

Jim Lykins

one And one last Okay. me. from

Beyond in the on see are out the Thomas, the conversions guys horizon? there you St. there two Ritz any other renovations significant

Jeremy Welter

don't next and/or comment right to contemplating to potentially there were next anything that another for are it we on do now, Not going it extend if things to but know we're some year. year, we year

gain upcoming we a were said space the But market information. for the So less. that holders in I pleased share us. Philadelphia. we're of still absorbing quarters can some Courtyard impact able was first or in I there's heavy like including the give think that more quarter year I you to I think while we And more unusual And very construction

Deric Eubanks

that And as the release the areas. seen have Jim improved thing our Hyatt central desk in we'll Park experience, construction you'll front an more quarter. lobby, earnings is you But Jeremy one and common That's under third second that's in mentioned. bars, have Creek know Beaver for

any not that we're dislocation, to just asset. drive but further from that anticipating really upside So

Jim Lykins

Thanks guys. Great. Okay.

Operator

Chris Instructions] next question Deutsche [Operator from Our come Bank. will with Woronka

Chris Woronka

terms Hey, BI good back might I the to of Can continue how St. is to fully until Thomas you in it the you proceeds gets to collect or guys. transition us guess going reopens once work stabilize? morning remind hand-off how -

Richard Stockton

the the that cap collect well, and provides hit a have there for under to whether contingent already subject the that or opportunity Yeah, post to to performance you policy market of asset. it's the and on disruption is still some extent opening BI current not, policy

look So, be demand we come Thomas winter is is going back to this XX% already know, to they're in and Thomas fact - at it by I you to next expected think, very winter. St. this operating St. as coming pretty quickly to we're optimistic XXX% at that back

back elements whether etc. So up it's XXX%. to seaports, are a all the other power, main infrastructure essentially all

Thomas is So rooms. in only missing St. the availability really the hotel of thing

there. business a of need is book to and up the see hoping have it. new, a not, we're open policy So, we'll we we BI that to use if strong But if

Deric Eubanks

job prior of done team and have was building sales at great good good a do that a storm there a the hotel. business. team to We he's The book

So reopens. we're the as hotel pretty excited

Chris Woronka

I you know, to this Obviously, on then a get year And what it to Courtyard underwrite right? top about there's is that, assume great. mean though going next kind of tough the it's strong from even was quarter, market. to underwriting are is still really, want that, the so to do is you're going The year? I Francisco, Courtyard you're Autograph, really some San to Does I ask comp this good great it - seeing to have differently, numbers have to impact or lift just be converting Autograph. how on you of you Okay going

Richard Stockton

a be lot we're calendar a of about our wind strong. of remains the demand going with I hotel and the around very just convention generators excited to there's that San lot still backs Francisco, very, There's rebranding. think to

to that to we think see I would lift. a positive expect So, continue

a We got now. right product because we've are benefiting, room great

branding lobby And not which the so, full it's space, heavy very plus been the we're without that, and experiencing benefit the are of very, public the getting we're excited folks about. Autograph, construction, but under

Chris Woronka

any just is getting - I some closer then And you that parts Okay. anything is of update there there, in real on Sarasota? a looking were know of moving any the at view? lot - timing there's estate the into but on initiatives

Deric Eubanks

that's the are Ritz progress projects, projects, permitting is Yes. Work It with architects, long two there Carlton and Sarasota. Tahoe Lake Carlton. we're small very making and making is the making development Yeah, progress Carlton, with progress residential Ritz plan. continues required. on Ritz on process our we're We're site a

this to place, give really a as update to And and of really dirt we'll of impact probably be so, this we're expecting as to reality, through and able get And have year. be a get update. our at not more on projects there's specific any next an that be next negligible you that in least going we those financial can year, permits we'll But more give you. moving until we year we becomes more then year

Chris Woronka

Very guys. Thanks Okay. good.

Operator

you. Thank

Our Michael next with Baird. Bellisario will from question come

Michael Bellisario

morning, Good everyone.

Richard Stockton

Good morning.

Michael Bellisario

back the the end it maybe that really throughout quarter impact a booking [indiscernible] group future maybe year the terms behavior? just what how Can to how you in booking sense periods start from at the of customers you the thinking market finish of of that tracked activity as into about broader and quarter give quarter for progressed to us the the saw and

Richard Stockton

was negative. quarter March Yeah, the just February was It what that, and is was of inventory. March is would I relatively because I it's such strongest that, the flat. of I a think But slightly month we had the specifically tremendous say had the think where we impact of seasonal vast of renovation out hotel of Philadelphia a rooms our Courtyard majority amount during

what very March commensurate adjust growth that, RevPAR would with you when January's So probably was. have for we

seen So a from that's to as far month. really as month bookings, big haven't I anything change

is - growth March is from there's in that looking it thing only the don't the terms impact though. of quarter I the anything forward gleaning think biggest a I during into think was renovation.

Michael Bellisario

push kind they that that rate on and know, on confidence. results just side their Can front? with your revenue brand lead have to of How are an side. you the you Okay. view guess, operators on operators I changes what to give of what the saying idea us of all you today implemented, ability the and changes And operational from then been the have of things? you're seen think better then those start your about hearing terms to level of of in their ground things

Deric Eubanks

Yeah.

even we're that, kind a RevPAR that increases out through taxes [indiscernible] maybe those we're about of And hotels I'm growth we're lot doing I side in and the talk at really, wasn't reflection of the X% initiatives take Let's a there lot to cost X% wages and well. you from if of first some segments. of but of that's look Richard property incentive pressures. increases. the going slightly two follow the on But and doing. could of mean of performed in is the let perspective, cost north benefits the lot a cost operating to seeing quarter, of increase in probably a P&Ls maybe to of are in mitigate really fees, I'll the because talk about the things we great eat

obligations bit RevPAR some talk little a we're some quarter. that growth, Marriott that. know, taxes contracts headwinds maybe as relates of So hotels in with as you handle doing which I on the it fees. having jurisdictions to can let within drive is think relates Richard we and have I'll really margin we second things job challenges control a to can't to our we property and some good it and incentive we're But

Richard Stockton

March, just a it's comment bit negligible mean performance really little on but I a you'll if in yes, to our margin. off, decrease margin make see Yeah, you already and haven't

increased property have to So we said, year. recurring things be wouldn't as expect - up as they've like the Jeremy amount which managed costs I we those we have gone think taxes can't every up, go

this I looking top-line, of terms we're flattish year-over-year. look, it's think shaping very In at quarter up as

with and we performing many third rooms in those that somewhat that's get So, do itself then strongly. more our hopefully so the service fixes of having rooms back property as be Philadelphia online quarter, and out we'll and to

term very generally. outperform outlook. into pretty But So, we've XXXX. and many I projects to we'll as be performance so drive able good I feel for the internal think our the full that's to said, got market near that the We that are going year

Michael Bellisario

maybe way. helpful. it ask That's Then different it. Got a to

top-line than Just a people setting from to on be confidence, the today, operators, do they have who the for are your sense any I did to they ago, able quarters you differently mean, focus example? the rates. increased rate couple push

Jeremy Welter

really I sentiment, continued rate We haven't that materially. Did in necessarily confidence decent anything We've rate. your quarter, push don't a increase there's in that's changed to think another. seen in or but the answer a way had been question? change one that levels I

Michael Bellisario

Thank you. Yeah.

Operator

you. Thank

from Next Riley we'll hear B. FBR. Bryan Maher with

Bryan Maher

Good afternoon.

that to and Just Did correct? $XX million one Francisco, there's spent that I $XX housekeeping is item about correctly far go San hear you've so million first.

Richard Stockton

Philadelphia it's Well, and for for projects, San as both both Francisco.

Bryan Maher

question maybe And Thanks. then a for is Deric. this

prior BI about of should what the that past quarter, in about was this do million and think consider million or guess? to year work? there be, does in $X just might How $X.X Thomas but How the to St. we kind BI we quarter. So, that ability for have

Richard Stockton

for second of first second function for quarter. be year, like year closed of in I was Jeremy consistent it's I and quarter what a as the for on with the at BI the Thomas Yeah, what's quarter this St. pretty was going will mean, property the think it probably of I last quarter. the part think mentioned, property the

BI quarter. little than of going that I would we were BI in be at But year. last have for properties second that QX point 'XX, had more So on out there costs 'XX, BI bit was of the in we a $X.X operating some it about the there in the will second also quarter that other million not made

So, mind. that's else that's something in terms modeling, to of keep the in

Bryan Maher

close BI Okay. is mentioned and for to how of you And you that share there - was so ago, a and a cap analysts you us then are? insurance couple the with that that cap what can

Jeremy Welter

been I some within very we'll the have beyond we we're to be renovation don't if quality and that stands a or of in think question a loss on our good is be combined with think achieve the we of part we've will what we cap. of good can that renovation that The you that, extended share going recognize cap, had program, with really today given look recognize? and I able the would to it able that between tell to at Trust if we the But, adversity all is I to we've this you cap the but spot, as able we're what Braemar, what program the the is, carriers, asset. really, all feel there complete

Deric Eubanks

good up reference renovation, in BI quickly. if Rich ramp probably forward, point. look expect that's pretty quarter, you expectations a said by we I think to XXXX post of property it just the for But, echo going earlier reopens to once at what think terms the I then

Bryan Maher

this at I look and granted I Tahoe before. then type And we know think lastly should EBITDA stronger Lake don't of should seasonality die, you given how is guys maybe think aberration snowfall but asset? that but year, property? the Okay. we can When from the a share about than about the how you've the this with summer, we was and Obviously Ritz-Carlton think of of me, there you that the winter information seasonality us that

Richard Stockton

something not it's know, You handy, we Bryan. have

into what really of stronger Tahoe you Creek Tahoe, quarter it quarter it like Hyatt shoulder mentioned, a of there little than Park you're that has say bit Beaver seasonality ramp know, more you the call individual at at summer to doing Beaver - the to Jeremy our think bit to does. is we to be and business we going stepping as Obviously, going if little second best book around as look the prepared know challenging, property. relates for Creek, that that second I'd give a not I But on quarterly to of up. we're the kind we're

Bryan Maher

me. from all that's Thanks, Okay.

Operator

I or our time to this we turn additional no for to at And you. remarks. questions closing further have like would back Thank in management over conference the queue. any

Deric Eubanks

soon. you today Thank the to speaking on call with look again everybody joining we us you for forward Okay. very and

Operator

conclude today. your again We our And you. for that Thank conference does for thank you participation.

Braemar Hotels & Resorts (BHR) 5 May 192019 Q1 Earnings call transcript