SVC - Earnings call transcript Q1 2021 | Service Properties Trust

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good morning and welcome to Service Properties Trust First Quarter 2021 Financial Results Conference Call. All participants will be in a listen-only mode. [Operator Instructions] Please note that this event is being recorded. I would now like to turn the conference over to Kristin Brown, Director of Investor Relations. Please go ahead.

Kristin Brown

morning. Good

management, today’s and Murray, Officer. Todd includes the to the that transcription and results presentation today’s meaning on statements forward-looking Chief expectations Brian Today’s through are Commission, Securities call based point Litigation forward-looking question-and-answer prohibited the of of out May any retransmission to call Act of SVC. on statements of securities Reform a The obligation Officer; and a the written of contains no revision Financial the made other that than Hargreaves, today’s are as by other the laws. of call me prior forward-looking the President; conference recording, John consent Donley, the filings call call conference with within session I XXXX. SEC. Joining with statements is and by analysts. Private followed Chief note Please XXXX today’s Exchange undertakes Securities without revise would like XX, and beliefs conference today, or or SVC’s release present company in These to publicly Investment

differ the components to may calculate those these section from Relations including Investor this FFO to FFO contain in may addition, the supplemental available of financial funds as website. well in of non-GAAP income found normalized net AFFO In operations, from and or forward-looking and results measures, materially Reconciliations are projected package call company’s Actual EBITDAre. our EBITDAre adjusted normalized statements. normalized in adjusted as

forward-looking on not our contained And the data filed with to operating I is turn call website those in and on any over www.svcreit.com. XX-Q cautioned financial that, statement. reliance to factors with Form Investors at our John. Additional that and information undue upon concerning cause our supplemental, differences will place could the found are SEC in

John Murray

morning. you, Thank Kristin and good

especially and the impact quarter economy on services retail businesses. certain Our pandemic the the on reflect operating hotels continuing results of and first

Sonesta you more past transitions, As quarters. management a disruption and hotel to results our Despite through The quarter. summer. of is restrictive during more the the a optimistic current for our and of XXX that we hotels normal on states, population are these lockdowns impact government transitioned we the had two February airlines seasonality overall by know, flights negative of results reasons weighed this vaccinated, branding coupled on the growing with of now are over increasing for challenges, lockdowns and easing in number number the driven are

light to at tunnel the normal. of end a So a for we return the see a new

While Business weeks. occupancy Sonesta Lauderdale making with to XX% not more recent be are for for attending. at video requirement we thereafter. encouraged March modest exceeded the Year-over-year start comparisons particularly recent are allow recovered vaccination with and and time meetings we since recently expect likely group testing of are proof a COVID near quarter in the look a In hotels, each for combination negative as person least the will by second year the or attendance disruption occupancy properties excess term pandemic our markets contribution gradual of and Hilton demand material and prior has to Sonesta drive demand booking transitioned posting XXXX in demand first Royal from transit of favorable Juan, increases levels in and activity. meaningfully in San of Fort results until Sonesta more increases and like to and in likely resort a

throughout the hotels pandemic. full stay Our our have to focus business and outperform suburban a service trend we extended continue select hotels urban service seen

XX.X% compared premium hotels with hotels reporting respectively during stay to to a XX occupancies XX.X% to for continue with Our our our extended quarter service significant hotels. XX.X% and of hotels service XX full extended have occupancy XXX the stay non-extended occupancies select of stay

our of continue travel recovers. our until extended outperform to business portfolio hotels We hotels diverse will stay suburban expect

approximately cash burn rooms XX.X%, The comparable Importantly XX% has quarter rates. occupancy weak seasonally positioned and daily first our average of launch. average in and each mitigate waiting to initially and for transitions hotels with us roughly helped hotels of well $XX.XX was extended impact negative was rate as the quarter from a RevPar Marion fourth flat ADA result $XX.XX, February the the stay

to and trended a low a in upward monthly April, on XX% compared with XX.X% XX.X% results since increases of in have March end basis year XXXX. However, accuracy to in December

operator, update the the I think largest be helpful you our to some of on number aspects hotels. it will

to At it us when First were and taking for today rooms that full we be Sonesta for important offices last year. independent then, will segments. we hotel first Back XX stay different small company a hotels are the with that and capabilities its its of people XXX employed Sonesta managed back upscale and improved was time, in small XXXX all, approximately service upscale than in announced in corporate Sonesta they Massachusetts. the extended is keep and upper mind in hotels upscale and

Sonesta rooms currently midscale for and upper hotels. range stay, manages service which XXX upscale service full hotels the to extended select from us with in segments, over XX,XXX

with the franchise Lion companies eighth Today largest the and Red largest the in franchises Sonesta rooms. brand is in which U.S., hotels, addition, company of XXX,XXX is it approximately Sonesta hotels America. In over recently one hotel management hotel acquired XXX and

and additions team industry his management is XXX,XXX currently with them of Florida spread New Orlando, corporate XXXX with employs maintains upgraded has operates across to in U.S. the majority U.S., rooms over have Colorado. Sonesta Denver, and size Massachusetts, people also that offices in the in With brands approximately experience. its close this massive Today XXXX increase recent locations three and hotels located different significant XX hotel the management Sonesta with Sonesta several

more Sonesta hotels. the XXX that in hotels on Now the transition which will provide XXXX, I quarter specific included we fourth color to

of quarter. March XXX from is results we former IHD October last challenges. stabilized XXXX lingering to $XX.XX the full the And Comparing at progress a for above are levels transition these genuinely hotels the hotels the with to of these managed hotels XXXX despite in transitions with the now has prior Redbox pleased Sonesta October slightly months results to-date.

Marriott But the in it's XX hotels were indications too IHD transferred are showing with relevant early transition. February-March. those because to same soon we of comparisons make the Hotels, most For saw the trends

its difficult brand hotel While manager is worst benefits believe pandemic of Sonesta disruption is larger Sonesta before awareness behind build is and new demand the us starting much of it fully scale. brand to to industry recovers realize the the the Nevertheless, during has disruptive the transition of transition even and a always grow. we hotels starting to is awareness to Sonesta just been

hotel their to network For through as in believe enabling Sonesta's management further us results fully In line. line increased as and demand the and the per that savings is industry year. XX% will area wants well sizes we short example, Sonesta solid the bottom to deliver transaction reservation behind significantly to OTAs transition lower versus to it last improves own on both costs XX% top

believe with we through companies as customer. in I for better if competition is more of this and not fact, to as with especially more of participate hotel to realized less franchise hotel as larger marginal some every perform post-COVID on a also business. in company XX% well update brand positioned positioned provide well also In the Sonesta brand its Hyatt. world to than SVC the in largest travel upside established major any an our by is ownership the Sonesta relationship want the creation business that and new

is If agreement, agreement. about these to transition know, you we're date unable or all how sent been And to the extended Hyatt reasonably end hotels to this As termination negotiate of effective hotels Sonesta this SVC XX in going. an letter to attempting January, are a XX. of under second path management mutually for agreeable the May the by We're which will optimistic these forward we has of reach quarter. some

renovation of each all a agreements entered have of review Sonesta transitioned we XX, recently best XXXX use and through with highest December needs For allow our the to term hotel. short of for and thorough hotels, management

the based to its level Rent pandemic and slowed lease and net collections XX.X% obligation quarter and from [indiscernible] team our rent rent assets during was and well coverage times service of our and stabilized. for about perform Request lease significantly locations first deferrals our our net our reopening to were of Turning have continues which retail for investment asset management property continued total net affected collections lease TA centers [courtyards] including quarter. this remain portfolio the X.X on America by occupancy restrictions. represents with TA choice, portfolio work attendants travel XX% have has to most

the with accordance hardest the movie are work worst believe reopen past certain crisis. like to in I easing they with in continue theaters, we COVID lockdown However, the of hit we as industries restrictions. tenants

to drawing to Supported of assets However, preserve including costs of we portfolio, take the with to recovery are control operators spending, from by credit our deferring nominal flow navigate cash well facility non with to liquidity down continue steady liquidity assets [indiscernible]. sales. we a steps January, completing dividend, and the portfolio our capital in selected and essential remainder our with working successfully and maintaining gradual diverse capital our lease ample and TA capitalized revolving net solidify well-positioned

quarter momentum discuss recent our hotel finish as balance the and to our as lease operating seeing of call to With confident I'll in further as early second in are the net continue detail that that, improving We turn our trends activity. Todd the to we're gain over will transaction the portfolio we well XXXX. out portfolio

Todd Hargreaves

John. Thanks,

beginning our America, from stable up our for service average collections at on portfolios largest minimum end. for represents our net portfolio XX based low investment XX.X% which and tenants anchor buyer Representing operating of tenants quarter of XX.X% with as TravelCenters our of of were own in were brands coverage a leased a XXX our of lease at XXX distinct March April XX.X% investment. by tenant XX.X As net weighted April XX.X% the rents XX.X% Rent of from collected on of square first net of XX, of portfolio was net XX.X% $XXX.X million. the We to net lease assistance trailing $XX.X million oriented industries XXXX and times aggregate pandemic, our granted under we of to XX lease annual the net including requiring net X.XX an deferred years Since rents of The lease lease feet March million tenants. of we've on previous lease extensions. and XXXX, of based XX minimum term $XX.X with XXX rent retail provided basis lease and our XXXX. month XX reclassified aggregate quarter overall or properties, assets due the rents lease tenants deferrals TravelCenters modifications from rent

deferred. As of remains April XX, of approximately $XX million XXXX, rent

uncollectible for for certain movie of tenants reserves theater, rent recorded primarily we quarter, revenues $X.X and first net lease the restaurant During fitness of our million leases.

As rental a the an changes as operating to all for reminder, collectability income. we assessment in recognize an lease adjustment

Turning recent our transaction activity. to

March agreement XX, we XXXX, own During XXXX acquisition aggregate we including rooms the price for for We're to with XXXX, net square in in we pursuant one with leasehold rentable related excluding of exercise to sales quarter ground rentable Springs Florida sell feet an Colorado in under $XXX,XXX, hotel for excluding that for a purchase interest with and sold and one land costs. acquired we million, property to ended closing million. $X.X of closing rooms excluding option for million, the costs Nashville, leased Tennessee, XXX also costs, million XXX five in $X.X by hotels $XX.X feet property with price sold closing property costs. a XX,XXX parcel a April the $X.X to purchase one store use a the square adjacent In

annual hotels price, this We leasing purchase to completed the are X% we the at expect to potential currently sale and return buyer be on these the quarter.

envision to each of highest decision Sonesta The may of of legacy term. sale repurpose operating hotels to as the determine for hotels improving sell Sonesta each or result declining upcoming we as capital or hotels I we to properties will through turn a otherwise that some the and or of markets. the the over well evaluate transitioned decide favor of overall of best to repurpose leverage hotels and long to the with or and can located of as term market quality asset. as intensive long now our recently geographic continue the the hotel be out don't or branded a hotel overlap disposition mechanism other market use reducing the quarters, for We Sonesta In call portfolio Brian.

Brian Donley

$XX first FFO and $XX.X quarter results million. was Starting with or million, the for negative consolidated of EBITDAre share, Thanks, Todd. $X.XX XXXX, per our a normalized of financial adjusted was loss

quarter adjusted million this and quarter $XX.X fourth million financing year generated and a the quarter. decline million portfolio A prior of negative security supported for that relates $XX.X $X compared and XXXX hotel activities uncollectible million $X.X EBITDA expense FFO hotel impacted Interest G&A year overall million $XX.X quarter. of of reserve leased also XXXX. rents result Guaranteed net results in as prior related quarter. our from and $X.X from quarter to prior million declined million hotel this for to of a $XX.X negative utilization XXXX historical our year in the hotel reserves lease in decline million our the activity. this expense million $XX.X our year-over-year. over decline and deposit EBITDA and $XX and properties draw our declined quarter first income to of the $X agreements the returns our revolved Rental our increased payments under of million Our disposition income

are hotel FF&E decreases For from to system percentage are our XX.X operating by decreased as million costs year decreased costs year, profit line $XX Below comparable declined result in prior this by and the RevPar excluding XXX revenues. and other reserves, period. margin profit points X.X% fees, costs a the the management transition comparable GLP of primarily decreased from that hotel XX.X%, to gross million percentage gross [$XX] hotels that related hotels operating tied approximately quarter prior

hotels of $XX million including costs. losses related $XX generated onetime $XX.X million for XXX losses our operating hotels. operating XX full of million Our rebranding of these quarter by consolidate the portfolio generated of were service

stay our related losses in the key XX as our conditions. to XXX where million were remains $X hotel flags. onetime $XX.X urban hotels hotels hotels XX $XX Our XXX D.C. full of weigh Two service due the they related Francisco, $X.X EBITDA on hotel service, to generated by market driven of of pandemic Chicago, are extended from Boston depressed were hotels were million markets losses such activity million to service the full hotels from largely hotels closed XX remain disruption service continue lodging and full service our to their and local the portfolio. transition and during of operating million select San select quarter. rebranded extended stay hotels three stay rebranded quarter. included during the quarter by costs first excluding moved $XX.X costs during million after [occurred] recognized brand Sonesta extended rebrandings.

We related for also incurred $X.X to Marriott of transition the an additional severance costs the employee majority to at hotels. million what's costs

$XX.X generated or continued positive quarter Hotels in San adjusted million. states cost in hotels have states $X leisure negative Louisiana, month March. hotels of million. of contrast losses Carolina Massachusetts XX restrictions have Jersey XXX the in rebranding aggregate of March breakeven. and XXXX destinations in we South our where of the many have hotels cashflow less the generated XXX EBITDA first To hotel Florida, their others performance. lifted in Juan million New $X operating million in hotel were EBITDA XXX our XX those million March. and hotels negative in $X.X $XX in the Excluding or and to In our positive Overall EBITDA Arizona, of was improve hotel Illinois, March, that have for generated California,

performance continue months. states to restrictions COVID As believe in the continue will lift we coming strengthen to

of of till a Excluding the February the just increase XXXX. of below hotels the hotels breakeven which few flags XXX XX% in March with last $XX.XX, were that sequential in represents and changed ReVPar the RevPar XXX in last occupancies XX% quarters flag comparable month in

XX% seen Our over increase March occupancy for April month sequential the to the of April, XX%, $XX.XX of an was March. was about increase for compared RevPAR overall compared XX.X% in XXXX. of Overall to XX% a

Turning to liquidity.

currently activity service the costs XXXX rent from year our triple significant cash expect quarter on full the approximately collections and to $XX hotels expectation half cash and quarter. continue hotel of full third first be on monthly portfolio, positive improving million for the in lease per lodging overall number stable of as at and stronger during before outlook average disruption cash hotel burn three fundamentals We for the back hotels. given flow QX capital for our Based the quarter to in before Our any subsides. funded rebranding capital XXXX the to turning industry from second in we based million EBITDA burn capital, We net adjusted maintenance expenditures. renovations a decrease $XX improvements rebranding first in of for the primarily the current quarter month our ongoing and our expect the positive

expect XXXX during the full million projected find $XX year the over capital approximately or projected This projection of quarter a fourth reduction provided to capital XXXX. We approximately our represents $XXX remainder call. $XXX from a of of I for spend total million of million

We million. [Redline] our evaluate prioritize year $XX as to capital Royal million scales, projected Soneta to related million Irvine, assets renovations spending XX% of and to giving the during $XX Maintenance three Sonesta. after liquidity and is directly to in and interest a capital and as is cost hotels of the will SVC service quarter effect in capital and savings this indirectly hotels million ownership contribution in approximately benefit of for our the [indiscernible] achieved is part of acquisition service its Sonesta be certain full believe the the value Sonesta SVC John's its Sonesta this To by of Kaua'i echo of at ownership management. benefit full branding the significant ongoing provide be approximately transition that California including year. we investments increase comments, projected Chicago, our management funding. of continue to projected will giving we Sonesta prudent Capital related be to continues hotels. for $XX.X after related acquisition maintain We funded first be SVC. $XX the Sonesta To SVC so to

not financial XXXX continue of and measure compliance until have to $XXX with believe Operators Regarding maintain ‘XX agreements. debt filling our precautionary this a we next us quarter our of being rate mid covenants through had after and liquidity expect stabilize. as quarterly to through in navigate our remarks. share we credit our our dividends in end, that XXXX. $X At believe drawn are positioned billion of adequate per common down million well debt we the concludes we approximately as we our current the to behind We will all logic liquidity and preserve of assess to one currently $X.XX we explore distribution facility is in to cash ensure under our options maturities prepared pandemic August continue we of fundamental

We open up are questions. ready lines to the of

Operator

you. Thank

answer We the today [Operator will with Please Riley Securities. now B. Our and go question begin will Instructions] ahead. come Maher question from session. Bryan first

Bryan Maher

and think Starting I draw first. Good next morning, When you just with for about in from the million cash, couple down. think liquidity Brian years. the questions A me left John two you and Todd. of the touched $XXX upon

cushioning cushion? mean, discussed How spending said of if much through plenty at quarter, yearend you XXX you XXXX? rest then of the is that is that think just you in bulk I XXXX. CapEx third and flow the the just positive I that go cash the of liquidity is

John Murray

million year. cash to operations the able Bryan, the We latter thank have of August half becomes that of the I nothing enough cash building we and in from do this be ‘XX. we'll start we think CapEx for we cover think you think year morning, question. in else, next $XXX that into if cover to due Good and Yes,

other So ride consider, to barring or we'll XXXX. might right transactions that into we do any think we able be

Bryan Maher

the there Okay convert maybe brand do six has and next the brand you a years? transitions with owners and of over the couple look when back what to much foresee the or biggest five the to you other the at opportunity been Sonesta with some Sonesta bigger challenges last unhappy months

John Murray

one. that Hey Bryan, it's John. I will take

that I the operator transition when of and system. the or were period about biggest notice losing they from there's you that a to hundreds challenge think happy you're going fact is terminate an hotels obviously the decide hotels you're

plans So transition they for post reservations date. stopped taking dates,

other So on couple letting really be weren't [indiscernible] cut before who there's that operators move them. and could off reservations usually have call IHD The guests happened, try made to months hotels. where making of prior those to were reservations or them

that So you maybe prior changing things up couple codes don't leading operational legally date make an And appropriately all to period. I typically any make and you operators documented few they're the before to make in you a don't systems. employees, information and sure from get favors you until the until transition to do employee transition you weeks the perspective trained a have sure weeks the detailed have new besides have have GDS to information the of just sure

so And more of a problematic when much is and consuming, furloughed. time your percentage that's workforces it's

the popping area they up battle to IHG the they've transitioned their quickly existing got And they that that reaching not and sales that scrappy to yourself only biggest I a aid some the of to IHG work. to Marriot for band computer the out assessed systems back having strength reservations out They've horns really get because think that you're and Sonesta the team. the by job has great of bull transitioned over furloughed amazing off to people and new employees the without the hard. enough and business. introduce were They employees And both from that initially that But and so those and ringing number work a and over challenges. used of are ripping telephone so pretty the screen and were transitioning we getting these some done but sales not in of taking In hotels found of employees the think the to cases sales the Marriott. that had

and travel, size going think is with the compete business new head drop brands. Sonesta on the scrappiness off with them to I help in that major their And so

to think that going to terms In number terms a of brands. of I ability on a they're lot hotels take their, the of Sonesta's in opportunities have of franchise, from to

I time rooms largest they month making are their to a where think towards and the brands the of Marriott, the one that the support out, going three really and you the and IHG, have space something invest you will big most that development they're and hotels for brands. taken going Sonesta brands, to or a have from focus new the brand, for in I that that's corners XXth contemplating to property think economics probably lot that's going work distinguish hotel Marriott amount the see with of owners to the dollars of they ability the be of shelf street have of such bigger market brand of an month new to and the over XXth Sonesta in have have if Hilton the a difficult

them Our experiences for and going for who that at hotels. working on their think not owners Marriott, what's hotel is Marriott that working understand really don't

Bryan Maher

opposed a from some then the sign signage. there that's the over dollars on before. property kept previously to signage that it Sonesta kind three from to to expect Sonesta hard of you noticed be convert that physical kind was I've to Sonesta the other or the I'll for intercon kind to as temporary a branded And to of and per to while properties of of narrowed Should quarters up only I And we me Marriott two for be one you more kind the back in now. those kind Have quick of replace cost down analyze kind hard might, whether is Great. to guys stay the queue. sold just of if will then property there wasted like one cost now are that that the follow hop have spending money on kind what sign of or

John Murray

what and the seeing a a to get Bryan, take dollars is get think takes permanent of signage answer Thanks, to of timeline up. the lot latter if that there just you're To those see put I signage one. the I'll you out part it permitting temporary that

the about and we the what IT computer of its and and things it licensing talking hotel it management So we permitting as or the signage is mean, long from the takes be of costs to down the hardware, we're or and spend I be it But that most on whether for could going every property keep revenue evaluating continue call far and hotel there that's what changes and not we're system, things it operations, other that I it to there, you're aggregate cost part the whether out obviously, component of Sonesta really but transition break and to get procurement and nature in latter you level about if point, numbers as think don't look hotel there. at that $XXX,XXX a average. The capital systems at legal nature. I average at the portfolio, think from it's hotel the permitting I little it's about that is about for but XXX,XXX bit how per talked to getting

Bryan Maher

Okay. Thank you.

John Murray

Welcome.

Operator

from with next ahead. go will our Sullivan come And Jim question Please BTIG.

Jim Sullivan

question like follow I'd sub-XX of to this really transition costs that on operating and costs. in quarter Thank of really initially you. about to million cost on XX QX, million same expense transition transition the

year assuming addition Hyatt transition for as of full in you is what I don't how the we no guess you QX be assuming the you've transition, in much for additional costs that just conversion to should Hyatt. Hyatt, So here transition continue first reported question with costs assuming

John Murray

think it an not a from all if of much of I into Hyatt, conversion statement income no we've Assuming captured standpoint of think quarters. future will it, the there I be most bleed to-date. don't

Jim Sullivan

big good hotel you transition EBITDA costs, calculation adjusted a details of increase a that costs being regarding expenses deduct The and items of of detail providing the QX of as on related line located? to and was helpful Okay just and get direct item adjusted expenses $XX $XX other looking secondly, then lion's to rose then a QX transition about and on on million. very hotel indirect the basis. Is EBITDA are line the quarter you which ton share hotel a million EBITDA move the provide from those the to consecutive the you what it where

John Murray

correct. add that costs. don't expenses. strip back showed they as We that's why out onetime Yes, think we recurrent an those That's are to

So that's the adjusting why yes. amount we're

Jim Sullivan

Yes.

Okay. the Marriott then the severance in had employee connection you And mentioned transition. with

were us contracts contracts, employees were one. Number subject become wonder those So the with Sonesta branded Number do hotels transition continue? Or hotel to of understand and IHG, when union? non the one, the number I could they if you do to two, help Marriott union the branded union

Todd Hargreaves

Yes.

a there union hotels. -- closed. still them in dozen a maybe So are are our Two handful of are in that portfolio the hotels

relationships. acknowledging trying to XX a most sign managed related other union well. in letter come Chicago when owner but out of concentration that there's a hotel which Marriott was around union markets, it remained to to determining costs it's Jersey, a and New If by as in The the the New those there recognition country York, are lot the spread IHG was In the pension Philadelphia cases, has to union, Sonesta. over when in significant are has or

Jim Sullivan

comments they, said think was costs prepared the agreements. I were that $X million of transition in severance cited So for the about

a employees to with of it has or you were arise with similar expense if of employment because of have those do agreement Hyatt transition? IHG the type did type that a the and So does similar Marriott agreement

John Murray

lot and if Marriott severance a related employees furloughed the are that bring costs back operations planning not a there to initially, by the if of period employees nuances substantial lot pandemic. that if saw affected to it's, negatively furloughed have A been with of of to still for you're time we are

is conditions, there time, an be trying employees two so evaluated way of the And the to time furloughed those council those councils should. all to and terminated they as as furloughed. be that made determinations those employees uncertain it which just some evaluated or employees soon period that's as Marriott to and transition to needed hotel opposed as them and additional would IHG labor and as employment at The

Jim Sullivan

on of trend, we line not that here from or is that's than item but anything phase fourth kind And transition a kind something of that item just and do rate quarter know then, the to transition are any I with likely on that in result the revenue specific quarter going forward Sonesta basis, base? that if to don't And should the the of a on this million $X more doubled on quarter. run line had continue if they agreement one first costs of is that or management Okay. the sequential assume

John Murray

correlated same. directly contracts contracts contracts, Sonesta hotels that's Jim, are the historical to the related transition these to and Yes

full hotels, fee run So Sonesta service a extended management X%. for X% stay

I directly that's revenues. mean tied So to

in grow accordingly. revenue fee as will grow that So

part and you of are fees structure, sufficient were market there to could profit flow was under returns, is more agreement meaning agreements their which operating Marriott the line earn cash So might in historical that pay Sonesta just with costs. our recall those expenses, IHG and fees. those junior they in But then

Jim Sullivan

leads revenue the and RevPAR. the of Under here trends run the as to Okay. of the should the obviously, top helpful by as given Sonesta as month in ADR, on EBITDA be final is should to that terms should Or or Marriott-IHG portfolio agreements occupancy the assuming margin you, very you've recovers line would it information which we higher under would kind pre-pandemic that question, we was the assuming be That branding? we margin, management it assume and EBITDA hotel be lower? same rate be hopefully what

John Murray

Brian indicated, the be fees base management will costs. management will, operating the as mean, on an I fees Sonesta

before possible forward So out fees Marriott the IHG that there the among credit talked support is that's that deciding transition with at and with or looks would way fact but we them their to the when ran about that senior was expense least in the superficially, will management it and be that ways as both added to Sonesta IHG and become upon insisted Marriott well. changes respect,

one something P&L think to regard aspect was going managing other our across the changed without to was to that brands managing. really happen of whether board I Sonesta it's it So the or that that

Jim Sullivan

Thanks, great. Okay, John.

John Murray

Yes.

Operator

will to for And I closing our the to any conclude back like remarks. would and John conference over this question session. answer Murray turn

John Murray

real you. of us and forward of look Thank next much for joining seeing estate and you months. some to Thank you virtual coming today. in We up couple hotel the person at very conferences in the

Operator

concluded. Thank is now today's conference attending for you presentation. The

disconnect at You your may time. now lines this

Service Properties Trust (SVC) 10 May 212021 Q1 Earnings call transcript