Chris Woronka

Chris Woronka inquired about the potential for a "lull" in demand before or after the FIFA World Cup in markets with Summit Hotel Properties' exposure, asking if the benefits from the games might be offset by reduced visitation during adjacent periods. He also asked for an update on Hyatt-branded properties, specifically regarding the beta test for "pay for breakfast" at Hyatt Place/House and any measurable benefits from changes to Hyatt's loyalty points program.

Answer

President and CEO Jonathan Stanner stated that a pre/post-World Cup lull is not a high concern, expecting the event to be net positive for the industry and Summit's portfolio. He explained Summit's strategy, similar to Super Bowls, involves securing a base layer of long-term stay demand (e.g., media, setup crews) with guaranteed nights at high rates (north of $300 for World Cup period) to de-risk transient pickup. Stanner confirmed that the "pay for breakfast" beta test at Hyatt Place assets was successful for the bottom line in the second half of 2025, with Hyatt still evaluating a broader rollout. He added that brands are generally receptive to ensuring loyalty program growth benefits hotel owners.

Chris Woronka inquired about potential lulls in demand before or after the FIFA World Cup in host markets, asking if the anticipated benefits could be offset by reduced visitation during those periods. He also asked for an update on the measurable benefits from Hyatt brand changes, specifically regarding the beta test of a "pay for breakfast" concept at Hyatt Place and Hyatt House properties.

Answer

President and CEO Jonathan Stanner stated that a pre/post-World Cup lull is not a high concern, as Summit de-risks by securing a base layer of longer-term stay business (e.g., media) at high rates (north of $300) and customizes strategies by market. Regarding Hyatt, Stanner confirmed that the "pay for breakfast" beta test at Hyatt Place was generally successful for the bottom line in the second half of last year, with Hyatt still evaluating a broader rollout. He also noted that brands are becoming more receptive to ensuring loyalty program benefits accrue to hotel owners.

Chris Woronka of Deutsche Bank asked for a detailed breakdown of demand changes by segment, the impact of soft brands on the select-service market, and whether the Oneira Fredericksburg expansion signals a new growth platform.

Answer

President & CEO Jonathan Stanner addressed the questions, noting that while higher-rated retail demand saw pressure, occupancy remained stable due to a mix shift. He highlighted a very narrow booking window, with 65% of transient bookings made within two weeks of stay. On competition, he viewed the overall low new supply growth as a significant long-term positive. Stanner confirmed strong interest in the Oneira 'glamping' business model, citing its high RevPAR, attractive margins, and strong returns, and stated the company plans to be opportunistic in growing that segment.

Chris Woronka of Deutsche Bank asked if the primary impact on demand was on shorter-booked weekend leisure trips, beyond the stated government and international segments. He also questioned at what point the company might approach brands for expense relief similar to COVID-era measures, and requested clarification on the drivers of the recent negative mix shift.

Answer

President and CEO Jonathan Stanner clarified that while there's potential for some softness, leisure has historically been resilient. He stated that the current situation is very different from the pandemic, and the company is already managing expenses effectively, pointing to margin performance and a $10 million reduction in the CapEx plan. He explained the mix shift was due to increased reliance on discount channels and OTAs to offset declines in the higher-rated qualified (government) segment.

Chris Woronka of Deutsche Bank asked if dispositions are driven more by CapEx requirements or market dynamics, and what role brand negotiations play in these decisions.

Answer

Executive Jonathan Stanner explained that the decision is a balance. Summit targets assets for sale that require significant capital where a new buyer can underwrite a different plan. He emphasized that the company also renovates 7-10 assets annually based on a very objective ROI analysis. While brands are supportive partners, their renovation requirements are not the primary driver of the sell-versus-renovate decision.

Chris Woronka questioned if there were concerns about union labor cost pressures spilling over into Summit's markets, whether the company expects any cost relief from brand companies, and for an overview of the strategy for its Hyatt Place portfolio.

Answer

President and CEO Jon Stanner stated that while the company is mindful of wage pressures, its low union exposure and concentration in Sun Belt markets provide insulation. Regarding brand cost relief, he acknowledged recent industry commentary but had no tangible information to share. On the Hyatt Place portfolio, Stanner clarified there is no broad initiative to sell the brand; dispositions have been targeted at lower-performing assets with high capital needs, and the remaining portfolio is generally in good condition.

Chris Woronka asked about Hertz's current EV strategy, its evolution, and how it compares to competitors' recent write-downs, seeking an update on the company's approach to its EV fleet.

Answer

Gil West (CEO) explained that Hertz, as the largest rideshare fleet supplier, has a different EV strategy focused on high-intensity operating environments like rideshare. He detailed the interior refresh of the Tesla fleet to extend asset life and noted that Hertz's EV experience positions them well for future autonomous vehicles (AVs), which are expected to be EVs.

Chris Woronka asked for more detail on the $1 billion EBITDA target for 2027, including the required fleet size and how revenue growth will be segmented across corporate, leisure, and rideshare.

Answer

CEO Gil West stated that the $1 billion EBITDA target for 2027 is achievable, supported by the North Star financial targets (DPU, RPU, DOE) and modest growth, with the fleet being the primary economic lever. CMO Sandeep Dube detailed a disciplined growth strategy: airport growth at or below TSA levels with a focus on higher-margin segments, continued growth in the off-airport business with enhanced margins, and strong growth in the mobility business. CFO Scott Haralson added that achieving all three North Star metrics would mathematically lead to well over $1 billion in EBITDA, and the platform component further contributes to this goal.

Chris Woronka of Deutsche Bank inquired about Hertz's long-term strategy regarding autonomous vehicles (AVs) and robotaxis, and asked for a breakdown of the recent Revenue Per Day (RPD) performance, questioning the impact of fleet mix versus market conditions.

Answer

CEO Gil West affirmed Hertz's potential role in the future of AVs, highlighting the company's operational footprint, fleet management skills, and financing capabilities as key advantages. EVP & CCO Sandeep Dube addressed the RPD question, explaining that while RPD was down, the company focuses on the broader Revenue Per Unit (RPU) metric, which saw sequential improvement. He noted the market was challenged but foundational improvements helped mitigate some of the pressure.

Chris Woronka asked about the fleet strategy relative to RPD, specifically how the company is balancing growth in lower-RPD off-airport business with a higher-end airport focus. He also questioned if the DPU target could fall significantly below $300.

Answer

CEO Gil West and CCO Sandeep Dube explained the strategy is to improve unit economics by pruning lower-margin business while focusing on high-RPD premium brands and direct booking channels. Regarding depreciation, West noted that sub-$300 DPU has been historically normal. However, CFO Scott Haralson stated they are not providing further guidance below the $300 target at this time, citing market volatility.

Chris Woronka asked about Hertz's potential medium-to-long-term normalized EBITDA margin and which specific business segments are being de-emphasized as the company optimizes its fleet.

Answer

CFO Scott Haralson indicated that normalized EBITDA can be derived from the company's 'North Star' metrics (sub-$300 DPU, RPU above $1,500, DOE in the low $30s) rather than a specific margin target. CCO Sandeep Dube clarified that the company is culling low-RPD business, such as opaque domestic packages, rather than de-emphasizing entire channels like airport or off-airport locations.

Chris Woronka inquired about the company's confidence in achieving a sub-$300 depreciation per unit (DPU) and the long-term strategy balancing a smaller fleet with the benefits of business scale.

Answer

CEO Wayne West expressed high confidence in the sub-$300 DPU target, citing normalized market conditions, advanced model year '25 purchases, and a new end-to-end fleet management strategy. West and Chief Commercial Officer Sandeep Dube explained that while scale matters, the immediate focus is on operating within the demand curve and generating profitable demand, with the ability to scale up later.

Chris Woronka asked about the conviction level in the 1% contract sales growth guidance for the year, seeking specific drivers like package activations for the latter three quarters. He also questioned the changing customer funnel from Marriott and the company's strategy for accessing newer, non-Marriott funneled customer channels.

Answer

Matthew Avril, CEO, expressed strong confidence in the guidance, attributing it to an intense focus on a culture of growth, driving tour flow, leveraging the existing pipeline, and increasing penetration of on-site guests at highly occupied resorts. He clarified that while there's still significant opportunity within the Marriott customer base, the company is also exploring other databases and strategic ways to activate its existing owner base through direct, virtual, and telephone channels.

Chris Woronka questioned the conviction level behind the 1% contract sales growth guidance for the year, especially given the Q4 2025 decline and expected Q1 2026 dip. He also asked about newer channels for customer acquisition, beyond Marriott-funneled channels, to increase customer engagement.

Answer

Jason Marino, Executive Vice President and Chief Financial Officer, clarified the contract sales guidance is 1% at the midpoint. Matt Avril, Chief Executive Officer, expressed confidence in achieving this through an intense focus on a 'culture of growth,' leveraging Mike Flaskey's expertise, activating the existing pipeline, and increasing penetration of on-site guests at 90% occupied resorts. Matt Avril also noted runway within the Marriott customer base and the exploration of other databases and strategic activation of the existing owner base through direct, virtual, and telephone channels.

Chris Woronka of Deutsche Bank inquired about the sustainability of the new owner mix growth into 2025 and whether there were any shifts in the financing propensity among first-time buyers. He also asked for clarification on whether the planned $90-$95 million in inventory repurchases correlates with the increased sales reserves from the prior year.

Answer

John Geller, President and Chief Executive Officer, confirmed the company's goal is to continue driving growth in first-time buyers, acknowledging the higher associated marketing costs. He stated there has been no significant change in financing propensity. Geller clarified that inventory repurchases are not tied to recent defaults but are related to long-term owners and maintenance fee defaults, which he described as stabilized churn.

Chris Woronka inquired about the expected impact of the new Pavilion sports bar/patio complex at Opryland, specifically if it helps leisure in shoulder periods/weekends in addition to groups. He also asked about the strategic consideration of franchising Category 10 or Ole Red brands, especially overseas, within the REIT framework.

Answer

Patrick Chaffin, Chief Operating Officer, explained the sports bar is primarily about increasing seat count and buyout opportunities for groups, strategically located near the convention center, while also serving as a leisure opportunity in the off-season. Colin Reed, Executive Chairman, confirmed interest in expanding brands overseas, particularly given country music's global popularity, and mentioned seeking partners for international expansion to avoid setting up local operations. Mark Fioravanti, President and Chief Executive Officer, added that it's the first of a multi-year F&B refresh to capture demand and elevate the experience for premium corporate customers.

Chris Woronka sought more color on the unfolding of the Pavilion new sports bar and patio complex at Opryland, asking if it's intended to attract more leisure in shoulder periods and weekends in addition to groups, and later asked about any impediments to potentially franchising OEG brands like Category 10 or Ole Red, especially overseas.

Answer

Patrick Chaffin, Chief Operating Officer, explained the sports bar is primarily about increasing food and beverage seat count at Opryland, which lacks capacity, and is strategically located for group buyouts, though it also offers leisure opportunities. Colin Reed, Executive Chairman, highlighted spectacular returns from similar investments elsewhere. Mark Fioravanti, President and Chief Executive Officer, noted it's the first of a multi-year F&B refresh to capture demand and elevate the experience. Regarding franchising, Colin Reed acknowledged the global popularity of country music and sees a big opportunity to expand brands overseas, ideally with a partner to avoid establishing foreign operations.

Chris Woronka from Deutsche Bank asked a two-part question regarding the drivers behind resilient out-of-room spending and the near-to-medium-term outlook for the Washington D.C. market and the Gaylord National property.

Answer

EVP & COO Patrick Chaffin stated that on-property spending remains strong and that the Gaylord National is performing well due to post-COVID structural changes. Executive Chairman Colin Reed added that a decent underlying U.S. economy supports spending. President & CEO Mark Fioravanti highlighted that recent capital investments in food & beverage and other amenities are successfully attracting higher-spending customers.

Chris Woronka of Deutsche Bank inquired about the duration of the near-term booking hesitancy and sought specifics on the cost-saving measures that enabled the company to maintain its EBITDA guidance despite a lower RevPAR outlook.

Answer

Executive Colin Reed, Executive Patrick Chaffin, and Executive Mark Fioravanti responded. Chaffin noted that April lead volumes for 'in the year, for the year' bookings improved significantly from being down 50% in March to down only 8% in April, suggesting the hesitancy might be moderating. Fioravanti added that future bookings for 2026 and 2027 remain strong, driven by rate. Regarding costs, Chaffin explained that the company proactively implemented $28-$30 million in profit improvement plans since January. Fioravanti highlighted that wage margin improved by 40 basis points due to increased efficiency and better labor management.

Chris Woronka requested a more detailed profile of the 'ideal premium corporate customer' compared to other groups, focusing on metrics like size, length of stay, rate, and out-of-room spend.

Answer

EVP and COO Patrick Chaffin characterized the premium corporate customer by their significantly higher out-of-room spend, which can reach $500-$600 per person per day, and a generally higher room rate. He noted that group sizes can be as large as associations and that top corporate clients are actively asking for more space. EVP and CFO Mark Fioravanti clarified the strategy is to achieve an incremental mix shift of 4-5 points toward corporate, not a complete overhaul, to drive profitability.

Chris Woronka from Deutsche Bank asked if the company is now consciously trading group occupancy for higher rates given the strong rate performance. He also requested an update on the company's potential participation in the San Diego Chula Vista property.

Answer

President & CFO Mark Fioravanti and EVP & COO Patrick Chaffin stated that while the goal remains 80% occupancy, the post-pandemic focus has been on driving rate, which they believe can be achieved alongside strong occupancy as demand fully recovers. Regarding San Diego, CEO Colin Reed and Mark Fioravanti confirmed their position on participation hasn't changed and noted they have seen no cannibalization, but rather new, higher-rated business rotating into their portfolio.

Chris Woronka asked if Life Time Group Holdings is considering leaning into the even higher end of the market with 'white glove' type services, such as transportation or special amenities, to tap into the highest-end customer segment.

Answer

Bahram Akradi, Founder, Chairman, and CEO, confirmed that the company is actively working on bundling more programming and has observed that a certain segment of memberships desires to spend more for white glove service and a more bundled, easier-to-transact approach.

Chris Woronka asked if Life Time Group Holdings is considering leaning into the even higher end of the market, exploring 'white glove' type services, bundled programming, or special offerings to tap into the highest-end customer segment.

Answer

Bahram Akradi, Founder, Chairman, and CEO, confirmed that the company is actively working on bundling more programming and sees demand for 'white glove' service and easier transactions from certain memberships, indicating 'more to come on that.'

Chris Woronka asked about Life Time Group Holdings Inc.'s design considerations for new club builds, particularly regarding flexibility to adapt to evolving customer preferences, such as more sport courts or training room space, and what potential impacts these design changes might have over time.

Answer

Bahram Akradi, Founder, Chairman, and CEO, explained that all large club formats, historically and currently, are designed with maximum flexibility to accommodate necessary programming changes over time. He emphasized that the design process is ongoing, constantly evaluating how spaces can be adapted for future needs, ensuring the ability to evolve with customer demands.

Chris Woronka asked about design considerations for new clubs, including new builds and conversions, specifically if there are changes in design to accommodate customer preferences for sport courts, training room space, or other elements, and the potential impacts of such changes.

Answer

CEO Bahram Akradi explained that all large club formats, historically and currently, are designed with maximum flexibility to adapt to evolving programming needs. He emphasized that design is an ongoing process focused on ensuring spaces can be reconfigured as customer preferences or industry trends change over time.

Chris Woronka requested clarification on the impact of club waitlists on overall membership growth, seeking a way to better understand the underlying growth dynamics.

Answer

EVP & CFO Erik Weaver and Founder, Chairman, and CEO Bahram Akradi both stressed that waitlists are a dynamic tool to manage member experience, not a key performance indicator (KPI). They advised against using it to read trends and pointed to rising visits per membership and total swipes as better indicators of club usage and health.

Chris Woronka of Deutsche Bank asked for an update on the performance of the recently expanded online and in-center supplement business (LTH) and inquired about the next phases of its growth strategy.

Answer

CEO Bahram Akradi expressed high confidence in the LTH supplement business, calling it a potential "incremental game changer" with expected "explosive growth" over the next 2-3 years. He noted that while it's in the very early stages, month-over-month growth is strong (e.g., February up 25% YoY), and he expects that growth rate to accelerate significantly as systems are fully built out.

Chris Woronka asked about the primary opportunity in club takeovers (revenue vs. operations) and requested a framework for the potential size of the LTH branded supplement business.

Answer

Founder, Chairman and CEO Bahram Akradi explained that takeovers are evaluated with the same return expectations as new builds (30-40% IRR), with the main benefit being pre-approved zoning. Regarding the LTH supplement brand, he stated a long-term vision to build it into a potential $500 million business, comparable to high-quality brands like Thorne, by leveraging Life Time's brand trust and growing customer base.

Chris Woronka asked for a characterization of the types of buyers interested in the non-core assets and any potential roadblocks to their sale. He also inquired about the longer-term plan for the New York asset after the upcoming labor contract renegotiation, including potential discussions with Hilton.

Answer

Tom Baltimore, Chairman and CEO, stated there is ample equity and debt capital, with a diverse pool of interested buyers including family offices, owner-operators, and deep value entrepreneurs, despite some market challenges. Regarding the New York asset, he highlighted its strong performance and unique positioning, expecting the labor contract to be resolved without protracted issues. He mentioned plans for infrastructure modernization and internal discussions with Hilton to determine the best long-term strategy.

Chris Woronka asked for a characterization of the buyers interested in the 10 non-core hotels and any potential roadblocks to their sale. He also inquired about the longer-term plan for the New York hotel after the upcoming labor contract renegotiation, including potential discussions with Hilton.

Answer

Tom Baltimore, Chairman and CEO, stated that there is ample equity and debt capital, and an adequate buyer pool consisting of small family offices, owner-operators, and deep value entrepreneurs, despite some markets being tougher. He emphasized the team's experience in handling complex dispositions. Regarding the New York hotel, Tom Baltimore highlighted the excellent operating team and strong 2025 performance. He expressed encouragement for 2026 and belief that a labor agreement will be reached without protracted negotiations, noting that after modernization work, the company will huddle with Hilton to determine the best long-term strategy for the uniquely positioned asset.

Chris Woronka asked about the recovery efforts in Hawaii, focusing on marketing, international airlift, and government support, and also inquired about the potential RevPAR and margin uplift from disposing of non-core airport and ground-lease hotels.

Answer

Chairman and CEO Thomas Baltimore discussed Hawaii's strong long-term fundamentals, including minimal supply growth. He noted a slower-than-expected recovery post-strike but highlighted sequential improvement and strong domestic airlift, despite a lag in Japanese tourism. On non-core assets, Baltimore confirmed their disposal would materially enhance the portfolio, increasing RevPAR to nearly $215 and improving margins, reinforcing the company's focus on reshaping the portfolio.

Chris Woronka asked for a definition of a 'good outcome' for asset sale pricing, questioning if it was based on metrics like NOI/EBITDA multiples, and inquired how the company was achieving operating expense savings to offset rising labor costs.

Answer

Chairman and CEO Thomas Baltimore defined a good outcome as selling non-core assets at multiples greater than Park's current trading multiple, thereby providing price discovery and capital for strategic reallocation. CFO Sean Dell'Orto explained that OpEx savings were driven by a favorable business mix, efficient staffing, and anticipated future savings in areas like insurance. Mr. Baltimore added that it reflects disciplined leadership and operational execution.

Chris Woronka asked if the rebranding of the Chicago W Hotels impacts their saleability and whether the Royal Palm renovation in Miami involves a reset of its franchise contract, potentially limiting future optionality.

Answer

Chairman and CEO Thomas Baltimore stated that the Chicago rebranding to a franchise model actually provides more optionality for a potential sale. For the Royal Palm, he confirmed it remains under the same Tribute brand terms with Marriott, providing 'significant optionality' and that Marriott is supportive of the renovation plans.

Chris Woronka questioned whether the outcome of union negotiations would deter planned ROI capital projects in union-heavy markets and asked for a refresher on the company's process for formulating annual guidance.

Answer

Chairman and CEO Thomas Baltimore stated unequivocally that the company remains bullish on its ROI projects, particularly in Hawaii, due to the market's strong fundamentals and high barriers to entry, noting renovations have already begun. Regarding guidance, he described it as a detailed, collaborative process with operators that can be affected by unforeseen events, but expressed confidence in the portfolio's relative outperformance.

Chris Woronka asked about adjustments to the marketing approach for 2026, specifically regarding tax refunds and potential P&L impacts, and how Travel + Leisure Co. views and interacts with the cruise industry to leverage its current tailwinds.

Answer

President and CEO Michael Brown indicated no specific marketing changes tied to tax refunds, but emphasized continued focus on owner arrivals, leveraging partnerships with Live Nation and Authentic Brands, and utilizing internal data for marketing. He noted the growing partnership with Margaritaville on cruises and an uptick in collaborations with other cruise lines, viewing it as a cross-marketing opportunity that could expand over time.

Chris Woronka asked if Travel + Leisure Co. had adjusted its marketing campaigns, including timing or messaging, to align with expected larger tax refunds and other stimulus. He also inquired about the company's view on the cruise industry's recent performance and any evolution in how Travel + Leisure Co. interacts with it to leverage tailwinds.

Answer

Michael Brown, President and CEO, indicated no specific marketing adjustments for tax refunds, but emphasized continued focus on owner arrivals, which indirectly benefits from economic wins. He highlighted closer partnerships with Live Nation and Authentic Brands, and leveraging data through new apps and AI for marketing. Regarding cruises, Mr. Brown acknowledged strong tailwinds in 2025, similar to the cruise industry, and mentioned leveraging the Margaritaville partnership for cruises, with an uptick in other cruise line partnerships in 2025.

Chris Woronka from Deutsche Bank questioned the declining visibility and performance of the Travel and Membership segment, asking about the impact of M&A and potential strategic alternatives. He also inquired about the drivers behind the increased average transaction size and its relationship with customer financing.

Answer

CEO Michael Brown attributed the Travel and Membership segment's weakness to industry consolidation and an unforecasted M&A event impacting affiliates. He outlined mitigation strategies, including growing the TravelClub business and exploring strategic alternatives. Brown also explained that the larger transaction sizes stem from price increases and strong owner engagement, not a change in financing propensity.

Chris Woronka of Deutsche Bank requested more detail on the rise in delinquencies, asking about the specific customer profile affected. He also asked about Q4 visibility given the current booking window.

Answer

CFO Michael Hug clarified that the increase in delinquencies was broad-based across all channels rather than concentrated in one customer type, though lower FICO score owners were slightly more affected. President and CEO Michael Brown added that despite the 116-day average booking window, they have early visibility into Q4 and see no concerning trends. Mr. Hug also noted Q4 is a strong owner-travel quarter, which adds to their confidence.

Chris Woronka asked about trends in consumers' propensity to finance purchases and the long-term strategy for the Travel & Membership segment.

Answer

Executive Michael Hug stated that the propensity to finance remains consistent, highlighting a record-high average FICO score of 744 for 2024 originations. President and CEO Michael Brown added that the Travel & Membership segment is focused on organic growth by offsetting exchange business headwinds with its growing Travel Club business. While open to strategic opportunities, the current priority is executing the organic growth plan.

Chris Woronka asked for details on sales close rates, the primary reasons why prospective new owners choose not to buy, and the long-term outlook for inventory strategy, specifically the mix of recaptured inventory and overall spending levels.

Answer

CEO Michael Brown noted that close rates have been consistent and remain above pre-COVID levels, driven by the value proposition of space and flexibility. CFO Michael Hug detailed the inventory strategy, stating the annual spend is around $100 million, with about half from recaptures. He expects this to remain stable for the core business, which has four years of inventory, though spending may increase with the development of the SI brand.

Chris Woronka inquired about any changes in lodging booking patterns for Epic Pass holders, such as waiting longer or booking shorter/longer stays, given the slow start to the season, and asked for an early read on ancillary spend for first-timers from new initiatives like Epic Friends tickets.

Answer

Rob Katz, CEO of Vail Resorts, acknowledged a booking deceleration in November and early December due to poor conditions, but noted a quick rebound. He highlighted that $1 billion in pass revenue represents nearly 75% of visits, indicating committed guests. Mr. Katz stated it's too early to assess ancillary spend for first-timers, expecting a clearer picture deeper into the season. He anticipates these guests will exhibit similar on-mountain spending patterns to the broader destination guest cohort.

Chris Woronka from Deutsche Bank asked about the strategic rationale behind Vail Resorts' pursuit of higher volume, inquiring whether this targets specific age groups or demographics, where these potential guests are currently spending their leisure time, and the company's confidence that investments in price and experience will successfully attract them to the mountains. He also followed up on the CapEx strategy, questioning if a significant increase in capital expenditure is deemed necessary to boost visitation and add new amenities, or if the capital plan will remain constrained by factors like EBITDA.

Answer

CEO Rob Katz explained that the goal is to ensure Vail Resorts captures its fair share of existing skiers and to increase frequency among those who already ski, rather than solely convincing non-skiers to start. He highlighted the constant flux in the ski industry with people entering, exiting, and changing their frequency, presenting opportunities to drive more skier visits. He emphasized that attracting these guests requires a combination of the right message, emotional connection, and overall value, not just price. Regarding CapEx, Katz stated that while lift upgrades are continuous, the focus is shifting to technology investments that enhance the digital and overall guest experience (e.g., rentals, lessons, food, booking). He believes these technology investments are less capital-intensive than replacing every lift and impact all resorts, making them a key differentiator. He confirmed no changes to long-term capital guidance at this point.

Chris Woronka asked about the strategic rationale behind pursuing more volume and making skiing more accessible, questioning if it targets a specific age group or demographic, where these potential guests are currently spending their leisure time, and the confidence in price and experience investments attracting them. He also inquired about the CapEx strategy, specifically if a significant increase is planned or necessary to attract guests and add amenities, or if the capital plan will remain consistent year-to-year.

Answer

CEO Rob Katz explained that the volume strategy aims to secure their fair share of existing skiers and optimize lift revenue, focusing on increasing frequency among those who already know how to ski, rather than solely attracting new participants. He emphasized that it's a combination of the right message, emotional connection, and value. Regarding CapEx, Mr. Katz confirmed continued investment in lift upgrades but highlighted that technology enhancements (e.g., My Epic app functionality, in-app commerce) are a key focus. He noted that technology investments are less capital-intensive than extensive lift replacements, impact all resorts, and are crucial for enhancing the overall guest experience. No changes to long-term capital guidance are planned at this time.

Chris Woronka asked about the strategic intent behind pursuing more volume and making skiing more accessible, specifically if it targets a particular age group or demographic, and how confident the company is that price investments and experience enhancements will attract these individuals to the mountains. He also inquired if a step function increase in CapEx is part of the plans to drive visitation and add new amenities, or if the capital plan will remain consistent with long-term guidance.

Answer

CEO Rob Katz explained that the focus is on increasing overall frequency and visitation among existing skiers and those who cycle in and out of the sport, rather than solely convincing non-skiers. He emphasized that it's a combination of the right message, emotional connection, and value, not just price. Regarding CapEx, Rob Katz stated that while lift upgrades will continue, the differentiator will increasingly be in technology and digital experience enhancements (e.g., app functionality, food, rentals), which are less capital-intensive than replacing every lift. He confirmed no changes to the long-term capital guidance at this point.

Chris Woronka asked about the strategic rationale behind pursuing more volume and making skiing more accessible, questioning if it targets a specific demographic and the confidence that price investments and experience enhancements will attract these individuals. He also inquired about the CapEx strategy, specifically if a significant increase is planned or necessary to drive visitation and add amenities, or if it remains constrained by EBITDA.

Answer

CEO Rob Katz explained the strategy focuses on getting Vail Resorts' fair share of existing skiers and optimizing lift revenue, primarily by increasing frequency among those who already know how to ski, rather than solely converting non-skiers. He emphasized that it's a combination of price, message, emotional connection, and value, noting the ski industry's dynamic nature and past record visitation as evidence of market potential. Regarding CapEx, Katz stated that while lift upgrades will continue, the focus is shifting to technology investments (digital experience, app functionality, ease of services) which are less capital-intensive than replacing every lift and impact the guest experience across all resorts. He confirmed no changes to long-term capital guidance are planned at this time.

Chris Woronka of Deutsche Bank asked if Vail can drive pricing similar to other travel sectors like the cruise industry without excessive spending. He also questioned if a 'grand reset' on operating expenses is necessary to manage costs.

Answer

CEO & Chair Rob Katz expressed confidence in the ability to continue driving price, supported by ongoing investments in the guest experience. He stated that a 'grand reset' on operating expenses is not needed, citing significant prior wage investments and the ongoing resource transformation plan which creates efficiencies without harming the guest experience.

Chris Woronka asked about the path to restoring long-term structural resort margins to pre-COVID levels. He also inquired about the methodology behind the 7% pass price increase for the upcoming season.

Answer

CFO Angela Korch explained that the current guided margin of 29.3% (ex-restructuring costs) is largely in line with 2019 when adjusted for acquisitions, with future expansion driven by operating leverage and the Resource Efficiency Plan. CEO Kirsten Lynch added that the 7% pass price increase is based on inflation, extensive price elasticity data, and a consistent strategy of pricing above inflation to reflect investments.

Chris Woronka from Deutsche Bank questioned whether new skiers exhibit consistent ancillary spending patterns compared to prior years. He also asked about the company's confidence in its staffing levels and cost controls should the season prove stronger than expected.

Answer

CEO Kirsten Lynch noted that last year saw strong spend-per-guest results and that new guests on Epic Day Passes tend to be destination-oriented with historically strong ancillary spend. She expressed high confidence in the current staffing plan, highlighting a historic high in the return rate of frontline employees, which improves guest experience and operational efficiency.

Chris Woronka of Deutsche Bank asked if hotel booking trends retained their predictive value this season given the weather impact. He also questioned if weaker renewal rates among some passholders affect the outlook for the new My Epic Gear rental program.

Answer

CFO Angela Korch acknowledged that resort lodging markets did not fill in as expected, with occupancy declining, due to both normalization in travel and weather conditions. CEO Kirsten Lynch expressed continued confidence in the My Epic Gear program, stating that since all skiers need gear, the addressable market is very large. She believes the convenience and quality of the subscription service offer a compelling value proposition to all passholders, regardless of their tenure.

Chris Woronka inquired about the drivers of Host Hotels & Resorts' out-of-room spend growth, particularly on the group side, asking about visibility, composition (e.g., higher menu prices, ancillary spend like retail and spa), and the sustainability of this trend.

Answer

Jim Risoleo, President and CEO, confirmed increased spend across spa, golf, and resort destination fees. He noted that while the affluent consumer continues to spend more, tougher year-over-year comps are expected for ancillary revenue and banquet and catering per group room night in 2026, which may shrink the delta between RevPAR and total RevPAR. He highlighted that reinventing and repositioning outlets, such as The View at the New York Marriott Marquis and Avive at the 1 Hotel South Beach, has significantly driven meaningful growth and incremental EBITDA. He acknowledged that many initiatives contributing to 2025's strong performance will lead to more challenging comparisons next year.

Chris Woronka asked about the drivers of Host's out-of-room spend growth, particularly on the group side, the visibility into its continuation, and its composition, such as higher menu prices or increased ancillary spend on retail and spa services.

Answer

President and CEO Jim Risoleo confirmed increased spend in spa, golf, and resort destination fees. He noted that while 2025 saw a significant delta between RevPAR and total RevPAR, this might shrink in 2026 due to tougher comparisons. He attributed continued growth to affluent consumers prioritizing premium experiences and Host's successful repositioning of outlets (e.g., View at the New York Marriott Marquis, Avive at the 1 Hotel South Beach), which has driven meaningful growth. He stated that Host continues to seek more outlet opportunities to drive incremental EBITDA.

Chris Woronka from Deutsche Bank requested a deeper analysis of the performance of Host's Hawaii portfolio, seeking insights on the outlook for the second half of 2025 and early 2026.

Answer

President & CEO James Risoleo confirmed that Maui's recovery is 'firmly underway,' highlighted by 19% RevPAR growth and strong ancillary spend. He noted the full-year EBITDA forecast for Maui resorts was increased to $110 million, up from $100 million, attributing the success to marketing efforts. He added that a full recovery depends on the return of incentive groups and increased airlift.

Chris Woronka from Deutsche Bank requested a deeper analysis of the Hawaii portfolio, particularly Maui's performance, and the company's confidence level for the second half of 2025 and early 2026.

Answer

President & CEO James Risoleo confirmed that Maui's recovery is 'firmly underway,' citing 19% RevPAR growth and strong ancillary spend. He announced an increase in the full-year EBITDA forecast for Maui resorts to $110 million, up from $100 million. He noted that the recovery is fueled by marketing efforts but that a full return to pre-fire levels depends on increased airlift and the comeback of long-lead-time incentive groups.

Chris Woronka questioned whether the current global uncertainty might create more acquisition opportunities for Host Hotels & Resorts in the near term.

Answer

President and CEO James Risoleo responded that the transaction market is currently in a 'wait-and-see' mode due to macroeconomic uncertainty, and the anticipated wave of distressed sales has not materialized. He emphasized that Host will remain opportunistic, focusing on its proven strategy of reinvesting in its portfolio, repurchasing shares, and paying dividends, supported by its strong balance sheet with 2.8x leverage and $2.2 billion of liquidity.

Chris Woronka of Deutsche Bank inquired whether group and business transient (BT) segments outperformed initial expectations in 2024 and if the 2025 guidance for these areas is consequently conservative.

Answer

President and CEO James Risoleo confirmed that BT is on a 'slow, steady climb' with a 6% revenue increase in 2024 and expressed optimism for 2025. He highlighted strong out-of-room spend in the group segment. However, he clarified that the main variables driving the guidance range are the Maui recovery and international travel imbalances, not conservatism in the group or BT forecasts.

Chris Woronka questioned the reasons for the persistent occupancy gap, with rates around 72% compared to over 79% in 2019, and asked if factors like shadow supply (e.g., Airbnb) were contributing.

Answer

President and CEO James Risoleo stated that the 8-9 point occupancy gap is not due to shadow or new supply. Instead, he attributed it to the slow return-to-office trend impacting business transient travel. He framed this gap as a future tailwind for the portfolio, expecting occupancy to rise as more employees return to offices.

Chris Woronka asked for a breakdown of the vehicle recall impact on Avis Budget Group's Q3 and full-year 2025 performance, specifically across RPD, volume, DOE, and fleet costs. He also questioned the company's strategy to decommoditize the industry and whether competitors are expected to follow suit.

Answer

CFO Daniel Cunha quantified the recall's cost impact at approximately $60 million in Q3, with an anticipated $90-100 million for the full year, noting a 2.8-point utilization impact in the Americas fleet. He expects challenges in Q4 due to seasonal decline and lingering vehicle unavailability. CEO Brian Choi emphasized Avis's focus on customer experience as a differentiator in an industry with a low bar, aiming for structurally higher RPD by offering a superior product, and welcomed competitors to follow.

Chris Woronka from Deutsche Bank asked for a breakdown of the recall impact on Avis Budget Group's Q3 or full-year 2025 performance, specifically across RPD, volume, utilization, and fleet costs. He also questioned the company's strategy to decommoditize the industry, wondering if competitors would follow and the long-term implications.

Answer

CFO Daniel Cunha detailed the recall impact, noting a modest decline in utilization despite 5% of the Americas fleet being grounded. He estimated a $60 million cost impact in Q3, projecting $90 million-$100 million for the full year, primarily from depreciation, interest, shuttling, and parking. He anticipates Q4 utilization to be more challenging due to seasonal decline and lingering vehicles awaiting parts. CEO Brian Choi stated that Avis Budget Group will focus on customer experience as a differentiator, welcoming industry-wide improvements but aiming to earn pricing power through a better product.

Chris Woronka from Deutsche Bank asked about the company's capacity for additional AV partnerships over the next 3-5 years, including investment plans and ROI metrics. He also questioned if the new 'Avis First' initiative would alter the company's vehicle fleet strategy.

Answer

CEO Brian Choi affirmed that Avis has significant bandwidth for more strategic partnerships and is prepared to deploy its balance sheet, while maintaining focus on the core rental business. Regarding 'Avis First,' Choi clarified that the initiative is a comprehensive service upgrade, not just a vehicle change. While they will ensure premium, low-mileage cars are used, the goal is to better segment existing fleet types to meet demand for a premium experience.

Chris Woronka of Deutsche Bank asked about the company's capacity for additional autonomous vehicle partnerships over the next 3-5 years and how it measures ROI, as well as how the new Avis First initiative impacts fleet acquisition strategy.

Answer

CEO Brian Choi affirmed that Avis has significant bandwidth for future partnerships but will be thoughtful and selective to ensure they are deeply integrated and don't detract from the core rental business. Regarding Avis First, Choi clarified that the initiative is about the entire premium experience, not just the vehicle. While it will influence fleet decisions towards more premium models, the strategy also involves better segmenting the existing fleet to offer the newest, lowest-mileage cars to Avis First customers.

Chris Woronka inquired about the company's willingness to aggressively lock in model year 2026 fleet purchases if favorable pricing became available. He also asked about the impact of customer mix (leisure vs. commercial) on pricing and any changes in strategy regarding demand channels.

Answer

CEO Joseph Ferraro confirmed they would absolutely lock in 2026 vehicles if the price point was right, but noted OEMs have not yet formalized their plans. Regarding mix, he explained that the seasonal shift toward leisure travel naturally helps RPD due to higher ancillary product sales. He affirmed that the company continuously works to optimize its results across all demand channels, including airports, off-airport locations, and ride-hail partners.

Chris Woronka of Deutsche Bank asked about the normalized vehicle hold period going forward and whether the exit DPU of around $300 is a good run-rate. He also inquired if the Chief Transformation Officer role would be refilled.

Answer

CEO Joseph Ferraro confirmed the analyst was 'spot on,' stating that hold periods and fleet age will return to historical, pre-pandemic levels, and that a DPU around $300 is a 'good proxy' for the future. Incoming CEO Brian Choi stated the CTO role will not be immediately filled, as the entire company is in transformation mode, and he will outline his priorities after the Q2 earnings report.

Chris Woronka asked about the potential for fleet costs per unit (BPU) to return to historical 2019 levels and the company's strategy regarding autonomous vehicles and ride-sharing.

Answer

CFO Izilda Martins stated that while fleet costs are expected to improve significantly, returning to 2019's low levels is unlikely in the near term, with the focus remaining on keeping fleet inside of demand. CEO Joseph Ferraro added that the company is actively and profitably growing its ride-share business and is well-positioned to participate in autonomous vehicle logistics due to its existing infrastructure and operational expertise.

Chris Woronka of Deutsche Bank asked what level of RevPAR growth would be needed to achieve flat margins in 2026 and inquired about any discernible changes in booking windows or booking sources, such as direct versus OTA.

Answer

CEO Leslie Hale indicated that Q2's results, which showed a 2-to-1 relationship between RevPAR decline and margin compression, suggest a move toward a more normalized operating environment. She also confirmed that booking windows remain short, which impacts visibility. COO Tom Bardenett added that brand.com is the largest and fastest-growing booking channel, up 2.5% in the quarter, with national corporate accounts driving growth in GDS bookings.

Chris Woronka from Deutsche Bank asked if RLJ was observing any irrational rate-cutting in the select-service segment and about potential supply concerns. He also questioned if the current uncertain environment has reduced the company's appetite for undertaking major renovations.

Answer

President and CEO Leslie D. Hale stated that RLJ is not seeing meaningful rate degradation, as its urban-centric, brick-and-mortar portfolio is largely insulated from new supply, which is not being built in its core markets. EVP and CFO Sean Mahoney affirmed that their strong balance sheet allows them to continue with renovations. He noted that tariff risks are mitigated, as the company has diversified its FF&E sourcing away from China, which now represents only 10% of FF&E, down from 40% pre-COVID.

Chris Woronka asked for the underlying January RevPAR run rate excluding outperforming markets like San Francisco and New Orleans, and for updated thoughts on branding or selling the Knickerbocker hotel.

Answer

President and CEO Leslie D. Hale acknowledged the outsized results but noted other markets also performed well. She provided quarterly cadence expectations for 2025. Regarding the Knickerbocker, she stated the current choppy transaction market is not ideal for a sale of such an asset and that no branding option has made sense to date.

Chris Woronka inquired about the expected ramp-up period for renovations, whether there is a pipeline of conversions beyond the next two years, and if RLJ anticipates benefits from brand-level cost-cutting initiatives.

Answer

President and CEO Leslie D. Hale confirmed a pipeline of roughly 10 potential conversions and a continued cadence of two per year. EVP and CFO Sean Mahoney explained they underwrite a 2-3 year ramp post-conversion but have been achieving it on the shorter end of that range. Regarding brand cost cuts, Hale stated that any cost reductions for franchisees are welcome.

Chris Woronka from Deutsche Bank questioned if the cruise industry is impacting resort demand, potentially shaping acquisition strategy, and asked if pressure on operating costs, especially wages, has eased.

Answer

CEO Jeffrey Donnelly acknowledged that competition from cruises is a consideration, particularly in markets like the Florida Keys, but its direct impact is hard to isolate. On costs, he noted that expense growth has been better than expected, with wage growth around 2%, partly because DiamondRock's leisure-heavy portfolio experienced its labor cost recovery earlier than urban-focused peers.

Chris Woronka from Deutsche Bank questioned if the cruise industry is creating secular headwinds for resorts and how that might shape acquisition strategy. He also asked for an update on operating cost pressures, particularly wages.

Answer

CEO Jeff Donnelly acknowledged that competition from the cruise industry is a consideration, especially in markets like The Keys, but its impact is hard to isolate and varies by property type. On costs, he noted that expense growth has been better than expected, with wages up only about 2% in the quarter, attributing this moderation to the earlier recovery and staffing ramp-up in their leisure-heavy portfolio.

Chris Woronka of Deutsche Bank AG asked about the booking window for short-term group business and whether the recent pause is a pricing tactic. He also questioned the stabilization progress of recently renovated properties like The Dagny.

Answer

CEO Jeff Donnelly stated the booking window is 4-6 months for smaller groups and 8-12 months for larger ones, and he believes the pause is for better terms, not rates. Regarding The Dagny, he noted it outperformed its first-year post-renovation EBITDA target ($14M vs. a projected $12M) and still has room to grow.

Chris Woronka of Deutsche Bank explored whether a rise in business travel could create a 'negative swap effect' by replacing higher-rate resort stays. He also asked if CapEx discipline could be applied to branded hotels as effectively as independents and sought an early outlook on the next insurance renewal.

Answer

CEO Jeff Donnelly expressed low concern about a 'negative swap effect,' believing the return-to-office trend won't materially cannibalize leisure trips. He confirmed that while it requires more negotiation, brand partners are showing more flexibility on renovation scope and timing post-pandemic. Executive Briony Quinn stated the insurance program renews April 1 and that while they are monitoring the market, early signs suggest a potential mid-to-high single-digit increase, which is better than feared.

Chris Woronka asked if the company could strategically leverage the popularity of its unique fall and winter events, like Halloween and Christmas, to drive pass sales and secure attendance for the following summer season.

Answer

CEO Marc Swanson agreed this is a key opportunity the company is focused on improving. He explained that one strategy is to launch sales for the following year's season passes early, allowing guests to buy a pass that grants them access to the popular upcoming Halloween and Christmas events, thereby securing their commitment and providing a hook for them to return the following summer.

Chris Woronka from Deutsche Bank AG asked for more detail on the types of projects funded by ROI-focused capital expenditures and inquired about the company's progress and future plans for implementing dynamic pricing.

Answer

Interim CFO James Forrester detailed that ROI CapEx is primarily directed towards enhancing food and beverage facilities, adding new retail stores at ride exits, and deploying technology to reduce operating costs. CEO Marc Swanson added that dynamic pricing is a key ongoing initiative, with opportunities to price items like front-of-the-line passes and admission tickets based on real-time demand.

Chris Woronka asked about the customer mix, questioning if the slightly lower pass base implies a higher mix of first-time visitors and its effect on per capita spending. He also sought an update on the hotel development initiative, asking if there was a specific deadline or factor driving the timeline.

Answer

CEO Marc Swanson acknowledged seeing more drive-in visitors versus local, consistent with a slightly down pass base, and noted existing passholders are visiting more frequently. On the hotel and real estate strategy, he explained that the process is complex as they evaluate numerous options (hotels, housing, leasebacks) with various partners to ensure they select the structure that creates the most value for shareholders, with no specific deadline.

Chris Woronka from Deutsche Bank inquired about the Andaz Miami Beach as a high-redemption hotel and whether the volume of loyalty point redemptions could affect its financial underwriting.

Answer

CEO Bryan Giglia confirmed they always expected Andaz Miami Beach to be a strong redemption hotel, which is a key part of the business mix for a desirable luxury resort. He stated that redemption activity is managed as part of the overall segmentation, helps drive compression, and does not negatively impact their financial expectations for the property.

Chris Woronka from Deutsche Bank asked for clarification on the Andaz Miami, questioning if the revised outlook includes costs for rebooking customers and what the booking window looks like for the crucial fourth quarter.

Answer

CEO Bryan Giglia confirmed that all costs associated with moving customers due to the delayed opening are included in the revised outlook. He emphasized that the hotel's opening is well-timed for the Q4 booking window, which is just beginning. He projected occupancy to ramp from 30-40% in early summer to around 70% in November/December, with rates increasing from the $300-400 range to $600-800+ in the peak season.

Chris Woronka inquired about the long-term strategy for the Renaissance Orlando, given its lower RevPAR and margin profile, and whether it could be a candidate for conversion or disposal.

Answer

Bryan Giglia, Chief Executive Officer, acknowledged the success of past conversions and noted the Orlando property's strength in the group segment. He suggested that a new nearby park could boost transient demand. While a rebranding is a possibility to attract a higher-rated transient customer, it is not in the 2025 capital plan but could be explored in the future.

Chris Woronka asked about the Four Seasons Napa, questioning if its structural margins can be improved given its small size, or if performance is solely dependent on driving higher occupancy.

Answer

CEO Bryan Giglia explained that margin improvement is a key focus. While driving occupancy is crucial, the company has also recently implemented cost-saving initiatives with the hotel's manager, similar to those successfully executed at Montage. These changes focus on non-guest-facing efficiencies and are expected to positively impact the P&L going forward.

Chris Woronka of Deutsche Bank asked if Six Flags has considered an "Epic Pass" model similar to the ski industry, potentially lowering prices to significantly boost the pass base and secure revenue upfront. He also inquired about strategies to better attach ancillary product sales directly to the season pass.

Answer

CEO Richard Zimmerman and CFO Brian Witherow responded that they are testing a similar concept by adding an "All Park Pass" benefit to their top-tier pass to reinforce the portfolio's value, similar to how Vail's Epic Pass works. Witherow cited a past success at Cedar Point where cutting pass prices tripled the pass base. Zimmerman added that the upcoming new e-commerce site and mobile app are designed to make it easier to sell all-season add-ons, which also drives higher renewal rates.

Chris Woronka asked about the guest mix at legacy Six Flags parks, the impact of the chaperone policy, and whether the desired mix is a multi-year project. He also followed up on whether the 'little things' and maintenance issues at these parks have been addressed heading into the peak season.

Answer

CEO Richard Zimmerman explained that the guest mix is being broadened by offering a varied capital mix of thrill rides, family attractions, and water park features, and that the chaperone policy has been helpful. Regarding park improvements, he stated that while the list of potential enhancements is always long, the company prioritizes items that guests value most, such as food and beverage, and will continue to make improvements year-by-year to enhance the guest experience.

Chris Woronka asked if legacy Six Flags pass holders might be delaying purchases, creating a potential for a later-season sales uplift. He also asked for a breakdown of 2025 CapEx between catch-up maintenance and new structural investments like food and beverage.

Answer

CFO Brian Witherow acknowledged the critical spring sales cycle is still ahead and that operational improvements serve as 'proof points' for guests, highlighting the long-term opportunity to raise Six Flags' pass prices. CEO Richard Zimmerman addressed CapEx by stressing the importance of consistent investment to enhance guest value, which in turn drives long-term pricing power, rather than bucketing it as simple catch-up spending.

Chris Woronka inquired about the size of the opportunity in retail and arcades within the legacy Six Flags portfolio and asked for details on the strategy and timeline for potential asset sales.

Answer

CEO Richard Zimmerman stated there is 'incredible opportunity' in merchandise and games, which will require capital investment to upgrade facilities, a factor included in their plans. Regarding asset sales, he noted they are methodically reviewing the portfolio with the Board, similar to past optimizations at Cedar Fair, but declined to provide a specific timeline, emphasizing a focus on capital structure and priorities.

Chris Woronka asked about a potential downside economic scenario where hotel discounting could erode the timeshare value proposition, and what contingency plans HGV has in place.

Answer

CEO Mark Wang and CFO Daniel Mathewes asserted that the company's value proposition is stronger than ever, especially in a high-rate environment, and has widened relative to hotel ADRs. Wang highlighted the resilience of the business model, citing a large prepaid package pipeline, 50% recurring EBITDA, a loyal member base, and key partnerships. Mathewes added that HGV's transaction price growth has been more in line with inflation, unlike the outsized growth in hotel rates.

Chris Woronka of Deutsche Bank requested an update on performance and outlook for HGV's three largest markets—Hawaii, Las Vegas, and Orlando—and asked if Hilton's recent brand acquisitions provide new lead generation opportunities for HGV.

Answer

CEO Mark Wang reported that Las Vegas remains a high-performing market, while Orlando has seen some softening. He noted Hawaii was impacted by the slow return of Japanese travelers and a now-resolved hotel strike. Wang confirmed that Hilton's brand growth, including new acquisitions, is a positive for HGV as it expands the loyalty member base and provides more guest data.

Asked for an update on discussions with the U.S. State Department regarding the Jamaica travel advisory and inquired about the scope of the upcoming Zilara Cancun renovation.

Answer

The company is actively engaged with the Jamaican ambassador and tourism bodies regarding the travel advisory but noted the issues are systemic and progress is hard to forecast. The Zilara Cancun renovation will be a 'complete reinvention,' not just a lifecycle update, taking rooms 'down to the concrete' to improve layouts and significantly drive ADR. The resort will be closed for 8-9 months for the project.

Asked about the U.S. State Department's methodology for the Jamaica travel advisory and if anything could be done from the U.S. side. Also questioned if the Puerto Vallarta renovation was yielding a rate lift and if there were any thoughts on using other Hyatt brands like Andaz for the Zilara Cancun renovation to drive rates higher.

Answer

The company finds the State Department's advisory nonsensical and plans to meet with them to question the rationale. The Puerto Vallarta renovation is more defensive, similar to Cabo, to maintain the asset's position. For the Zilara Cancun, while all branding options are considered, the company sees a huge opportunity to elevate the existing Hyatt Zilara brand to a premium rate product by significantly upgrading the property, closing the rate gap with newer resorts.