Logan Epstein

Logan Epstein of Wolfe Research asked about the company's strategy regarding the trade-off between rate and occupancy, noting that some top-performing hotels showed strong occupancy with weaker rate.

Answer

CEO Bryan Giglia explained that this is a deliberate, hotel-specific strategy. For example, a new hotel in its low season (Andaz Miami Beach) might sacrifice rate to build an occupancy base. In other cases, a resort might accept a lower-rate group that delivers high ancillary spend, ultimately driving higher and more profitable Total RevPAR.

Logan Epstein of Wolfe Research inquired about the labor environment, specifically regarding employee retention, the timeline to reduce contract labor usage, and the company's current strategy for acquisitions versus dispositions.

Answer

EVP & CFO William Conkling responded on labor, noting that the employee base is now 'stickier,' with turnover down nearly 40% from peak levels. He stated that contract labor has stabilized and they will continue to 'chip away' at reducing it from its current 10.5% of labor costs. President & CEO Jonathan Stanner added that the company expects to be a net seller of assets for the year, focusing on non-core properties to fund share repurchases and deleverage the balance sheet.