Daniel Hogan • Robert W. Baird & Co.

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CEO Leslie Hale confirmed that leisure rate sensitivity is driving travelers to discount channels, a trend expected to continue. She contrasted Q3's softness with a more positive outlook for Q4. On expenses, Hale projected approximately 2% growth for the second half of the year, crediting the operations team for aggressive cost controls. COO Tom Bardenett elaborated on these initiatives, which include optimizing labor, procurement, and leveraging the portfolio's lean operating model.

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CEO Jeff Donnelly stated it was too early to comment on 2026 sustainability but noted his instinct is that the current growth is skewed more toward price, driven by menu engineering and ancillary fees. He confirmed the growth has been broad-based across both group and transient business, impacting urban and resort hotels, but did not provide a specific categorical breakdown.

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CEO Jeffrey Donnelly stated it was too early to comment on 2026 sustainability but noted his instinct is that recent growth skews more toward price. He explained the growth has been broad-based across group and leisure business, impacting both urban and resort hotels, and includes F&B initiatives like menu reengineering as well as non-F&B items like parking and amenity fees.

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CEO Justin Knight clarified that while buybacks are primarily funded by asset sales to highlight the value arbitrage, the company has the flexibility to be opportunistic. He noted the July pause in buybacks was due to the earnings blackout period, not a change in appetite. Regarding dispositions, he stated that while CapEx is a factor, the main goal is maximizing value, and the company might even renovate assets before a sale to enhance returns.

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CEO Bryan Giglia reported that the 2026 group pace is up in the low single-digit range. He identified Washington D.C., Miami, and New Orleans as strong citywide markets for 2026, and specifically highlighted that San Francisco has very strong internal group pace, which should drive continued growth.

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President & CEO Jonathan Stanner explained that the timing of the $15.4 million share repurchase was influenced by the proximity to the earnings period. He affirmed the company's strategy to fund buybacks with proceeds from asset sales, noting two hotels are currently under contract. Regarding the manager transition, Stanner clarified that the economics remain similar and the change was made primarily to focus operations.

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Chair & CEO Marcel Verbaas explained that there are limited large-scale ROI opportunities and expects CapEx to decline in coming years. President & COO Barry Bloom addressed expenses, confirming they are lapping tougher wage comps but do not expect significant margin improvement in H2 due to the muted RevPAR environment ex-Scottsdale.

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President & CEO James Risoleo characterized the Cincinnati property as a unique situation, ranking at the bottom of the portfolio due to its market, ground lease, and lack of investment. He asserted, 'I don't know of any other hotel in our portfolio that is in that dire need of CapEx,' adding that the company likes its current portfolio, where the top 40 assets generate over 80% of EBITDA.

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Chairman & CEO Jon Bortz acknowledged that increased discounting and promotions have impacted the summer season but stated the trend has not worsened as the summer progressed. He anticipates that this price competition will likely dissipate after Labor Day as leisure demand patterns shift.

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