Good day, ladies and gentlemen, and welcome to the Park Hotels & Resorts First Quarter 2017 Earnings Call. [Operator Instructions] Please note this call is being recorded. It's now pleasure to turn the program over to Ian Weissman, Senior Vice President of Corporate, Strategy.

Good morning, and welcome to the Park Hotels & Resorts first quarter and 2017 earnings call. Before we begin, I would like to remind everyone that many of the comments made today are considered forward-looking statements under federal securities laws. As described in our filings with the SEC, these statements are subject to numerous risks and uncertainties that could cause future results to differ from those expressed, and we are not obligated to publicly update or revise these forward-looking statements. In addition, on today's call, we will discuss certain non-GAAP financial information such as FFO and adjusted EBITDA. You can find this information together with reconciliations to the most directly comparable GAAP financial measure in yesterday's earnings release, as well as in our 8-K filed with the SEC and the supplemental information available on our website at www.pkhotelsandresorts.com. Additionally, it is important to note that all financial results will be discussed on a pro forma basis, which takes into account post-spin adjustments, including the new management fee structure and presents the results of our portfolio as it stands today. Reconciliations to the closest GAAP financial measure in our combined consolidated financial statements, which were paired on a carve out basis and do not contain these pro forma adjustments, may be found in the supplemental financial information available on our website. This morning, Tom Baltimore, our Chairman and Chief Executive Officer, will provide a brief overview of our first quarter operating results and outlook for the remainder of the year as well as update you on our strategic initiatives. Sean Dell'Orto, our Chief Financial Officer, will provide further detail on our first quarter financial results and most recent activity as well as provide an update to our annual earnings guidance. In addition, Rob Tanenbaum our Executive Vice President of Asset Management will be joining for Q&A. Following our prepared remarks, we will open up the call for questions. With that, I would like to turn the call over to Tom.

Thank you, Ian, and good morning, everyone. We are pleased with our first quarter results which met or exceeded expectations on several key metrics, including RevPAR, margins, EBITDA and FFO, clearly demonstrating the benefits of owning a geographically diverse portfolio of high quality hotels and resorts with multiple sources of demand. RevPAR of domestic portfolio, U.S. RevPAR on a comparable basis was up 1.7% and even with this moderated RevPAR growth, we were able to drive EBITDA margin expansion, which was up 15 basis points better than we anticipated. We are pleased with the progress that our asset management team and our operating partners at Hilton had made and starting to improve margins across the portfolio. A key driver of this improvement has been our enhanced focus on group business, an area that we have identified as a key opportunity. Total group revenues increased a solid 7% during the quarter, led primarily by a strong group fundamentals, which in turn fueled large gains in banquet and catering revenue up almost 13%. Overall, comparable RevPAR grew 1.4% during the first quarter on a currency neutral basis. Our margins for the portfolio as a whole were down 10 basis points with our solid U.S. performance offset by our international portfolio, which was down 5.3%. The drag on international was mostly felt at our Hilton asset in Brazil, which experienced a 24.1% drop in RevPAR given the challenging economic conditions in the region. Excluding San Paolo, RevPAR growth for our international hotels would have been a positive 3.7% overall. Looking to where we are in the lodging cycle, our RevPAR performance has been somewhat choppy month-to-month, fundamentals remain positive, albeit at a more moderate pace with the industry delivering its 85th consecutive month of RevPAR growth. We believe that part remains well-positioned to…

Thanks, Tom, and welcome, everyone. As Tom noted, we reported very solid results for the quarter, underscoring the benefits of owning a high quality well diversified portfolio. Looking at our results for the first quarter, adjusted EBITDA was a $177 million, while adjusted FFO was $138 million or $0.64 per share. Both of which were slightly ahead of our own internal forecast. Portfolio performance was largely driven by strength across our top 10 assets, despite the challenges faced in San Francisco. Overall, across our top 10 assets, hotel adjusted EBITDA increased 7.1% during the quarter, with margins increasing by 70 basis points, driven primarily some very strong results at the Hilton Chicago and Hilton New York. As Tom alluded to earlier in his comments, Q1 was a noisy quarter with various events affecting year-over-year comparison. In San Francisco, we attribute approximately 80 basis points of RevPAR impact to the portfolio for last year's Super Bowl. On the positive side, we estimate that the inauguration DC attribute 10 basis points of benefit while the Easter shift also positively affected our portfolio as first core performance like 40 basis points. Turning to the balance sheet, we continue to adhere to our principle of conservative balance sheet management. As of March 31st, we had $3.2 billion in debt outstanding inclusive of our pro rata share of unconsolidated JV debt. Along with $336 million of total cash and a $1 billion available on our revolver, which we believe has ample liquidity to execute on our strategic plan. Our trailing 12-month net debt to adjusted EBITDA ratio was 3.8 times, well within our stated target range of 3 to 5 times. In terms of dividend activity for the quarter, on March 9th, as part of our intended reconversion, we completed the purge of our historical…

Yes, we can take our first question from Anthony Powell with Barclays. Please go ahead, your line is open.

Hi, good morning guys.

Good morning, Anthony. How are you?

Doing well. The group revenue growth was pretty strong in the quarter, could you describe how much of that was due to the Easter shift compared to some of your own efforts to. In addition, did you talked about metrics like forward production and pace.

I think the couple of things, Anthony. One, we're not seeing any kind of deceleration in the group pace. I think we said in the last call, we expect around 1% in the year. We standby that and have certainly cautiously optimistic. I do think it's worth noting obviously second quarter is going to be the slowest in terms of a group pace, but if you and that's largely related to San Francisco. If you take out San Francisco in the second quarter, we expect to be up about 1.1% in group. And if you look for the full year, we would expect to be up in group pace about 2.4%. So, we are encouraged, give tremendous credit to Rob Tanenbaum and our asset management team and just how proactive they've been. I also want to complement our operating partners that the collaborative spirit that focused the frequent meetings. Again, a quarter doesn't make a make a year, but we're very encouraged by the early progress we're seeing across the Board and particularly in our strategy to group obviously as we set the fundamental tenant for us for the balance of the year. Rob, anything you want to add?

Sure, with regards to group corporate group, corporate group is up 16% fourth quarter which was very encouraging. And we've also see an increase in business transit for the quarter which was up 6.5%. As we look into 2018, we're very encouraged by our group working pace which is up in the high single digit.

Okay. Thanks for that detail and on the non-core asset sales program, what kind of timing are you looking at and what do you think the pricing kind of environment is for those types of assets?

That's a great question, Anthony. A couple of things I'd point out obviously, we think if you look at our history our guiding principles obviously operational excellence has been prudent capital allocator and of course having a low-level balance sheet we think obviously being a prudent capital allocator terribly important to recycle capital. When you look at our portfolio obviously our top ten assets account for about 61% of our EBITDA, our RevPAR of about $203 plus or minus our top 25 hotels account for about 82% of our EBITDA with a RevPAR of about a $182 and there's a drop off and so we believe strongly that it makes sense to recycle that capital in those slower growth markets into higher growth markets. And if you look at some of the assets that we've identified so far earlier in the process, they have a RevPAR that's at least 25% below the portfolio average so again we're beginning the process. We'll be thoughtful about it, I don't see any of that happening here in the next quarter or two, I think it will take time as we study but we'll begin that journey and begin that process. We think it's a very prudent course to be recycling capital again on a slower growth markets into higher growth markets. We're also stating CapEx dollars so very efficient use of capital as we move forward. So, not just similar to playbook, you've seen me used in the past and you'll see the Park team used it as well and we'll be thoughtful and laser focused on it to make sure it's done appropriately.

All right, great. Thanks.

And we'll take our next question from Robin Farley with UBS. Please go ahead.

Great, two questions. Thanks. One about…

Good morning, Robin. How are you?

Hi. Good morning. Thanks. One is just some consolidations, some M&A activity among smaller mid-size B2B industry is that a strategy that you think that you may use to sort of advance your focus on the abrupt scale luxury in the top 25 is that rather than doing through the asset by asset? And then also just want to clarify from your earlier comments about group business you mentioned the 2018 was up but I'm just trying to understand if what you saw is consistent with from others about bookings in Q1 for the rest of '17 have you also seen a decline in that or I don't know if you're saying that you're seeing something different than always heard from others? Thanks.

Yes, it's two great questions, Robin. Let me just be crystal clear on the group comment and if I miss something my colleague Rob can jump in here. We are not seeing any kind of deceleration in our group pace for 2017, we said last quarter that we expect the group to be up 1% and we're maintaining that without issue. Anything, we're seeing encouraging signs on short term group pick up and what I wanted to point out of my earlier comment is that if you take out San Francisco for both the second quarter, we would be up 1.1%, more importantly, if you take our San Francisco for the balance of the year, for the entire year, we would be up 2.4% in group pace so no deceleration and reiterating what we said earlier we're cautiously optimistic, when we back up and look at both GDP we know was the soft trend in Q1. We do believe if you look out for the balance of this year and next year a 2-2-2-3 planned for GDP is encouraging lodging even more important than that is non-residential fixed investment. Obviously negative last year, down with negative 0.5% forecasted to be a 3% this year we see that as a huge tailwind and a real benefit for lodging giving the strong correlation between business investment in lodging demand. So, very encouraged and the other point that Rob made again, if you look to 2018 the booking pace again mid to high single-digits already and we have about 80% of our group business already on the books for 2017. So, we're feeling very good about our positioning and again we've got tremendous efforts in activities underway with our own internal asset management team coupled with our operating partners at Hilton. Regarding your…

Great, yes. Thank you.

And our next question is from Bill Crow with Raymond James. Please go ahead.

Hey, good morning. Thank you. First topic, on the asset sales - the non-core asset sales, I want under the impression that maybe you take the first year to kind of settle and that be real active and it seems like maybe a departure from that. I am just wondering whether the timing is a little bit sooner than you might have contemplated in it. The second part of that first question is really about use of proceeds. Will you be force to use 1031 exchanges and you'll be out there in the acquisition market?

Yeah, I think look. The messaging might be a little sooner than perhaps you thought. If I could change anything perhaps in the prepared remarks it would be probably more hearing from us soon the months ahead probably not weeks ahead. This will take time, this is a large portfolio, we want to be careful, we want to study the portfolio, we put some asset to the buckets those that believe that obviously are strategic, others that we see as opportunistic and others that we think candidly are in lower quality assets. Again, slower growth markets don't capital incentive. We don't think that's going to be a prudent use of capital, so we think beginning that process to analyze and study and then we are getting some brokers to give us value, so that will take really some time to sort of sort out and then as we look to execute in sale whether its single assets, small portfolios again given the build gain of this the tax requirement is part of the spin the 1031 life exchange will likely be the vehicle that we use with the proceeds. But again, we will continue to study that and I have word to say that about that in the month ahead.

Great. And then my second question is, I am just curious whether you're benefiting in New York at all either on a very short-term basis or as you think about group booking pays in future years from the Waldorf's closing?

Yeah, Rob is going to give you a little more color on that. I would say a couple of things. That we are very encouraged by what we saw in first quarter. Again, and we did benefit obviously from some tailwind, but a 2.9% plant in New York is strong. I would also add, as you look at April and I didn't talk about this earlier, but let me just say one thing that shows again our cautious optimism, we expected April across the portfolio to be down probably a negative 2% to 3%. We are expecting April now to come in probably just south of 1% positive. So, that's encouraging and again, we benefit from a little bit of tailwind in New York, but New York was up 8% in April. So, those are positive nuggets as we move forward, I want to make sure the listeners hear. Rob?

Bill, good morning. We look in New York in particular, we started the quarter with pace deficit of 7.5% and we ended with the group pace positive up 5.9%. That's a credit to the team and the property just adjusted sales strategies led to the volume increase. So, we really, we're thrilled by what they are doing. In terms of Waldorf, it was minimal impact in the quarter by the Waldorf, because Waldorf closed in March 1st. We saw maybe 500 demand I think transferred over demand. And then overall the Waldorf impact on the health of New York is approximately $14.5 million in definite business, 70% of that was catering 30% of that was rounds, majority of rounds coming into fourth quarter and while the catering definitely coming in all - in many three-quarter last year. We like what we are seeing from the change and we feel very comfortable as they approach and take these groups being able to be permanent future as well.

Great. Thanks for the color.

Our next question is from Ryan Meliker with Canaccord Genuity. Please go ahead.

Hi, good morning everybody. I want to talk a little bit about San Francisco, if I think or you mentioned in your prepared remarks was that and you have about 26,000 out of 36,000 group room nights already booked for your San Francisco asset? I'm wondering if what the likelihood of booking those other 10,000 rooms is if it's not likely how you guys are thinking about that. And then what type of number you show like you need to see out of those 10,000 remaining rooms to try to book to get you to targeted RevPAR growth flat to down 1% in San Francisco that you mentioned in the last call? Thanks.

That's all great questions, Ryan. Let me try to frame a couple things on first quarter from San Francisco. If you look at the two hotels on the CBD, Union Square and obviously, Parc 55 were down 3.8%, Parc 55 was up 4.2% of RevPAR and San Francisco down 8%. It's important to note obviously, we had renovation disruption. As I said 850 basis points, if you take out the renovation disruption, our 200,000 San Francisco actually would have been up for the quarter and RevPAR 1.9% and it's important to recognize that. So, again and significant we would about perform the market. I would say that we still feel confident that we are going to outperform our appears. I would say we have seen probably a little bit of erosion and said that and you astutely a pointed out, I said down 1%, I would say now we've probably looking to down 2% for the balance of the year, probably a little bit of conservative in the net and I'm confident that that Rob and Sean will make up some of that ground. But still we still expect that we will outperform our peers in that 200 to 300 basis points if not more for the balance of the year. A lot of that is just because of second quarter and obviously second quarter group is down pretty significantly. Again, we did announce that we had backfilled 26,000 of those 36,000-group working in terms of some of the tactics that we're employing. I'll let Rob give you some additional color on that.

Hi, good morning. With regard to tactics really looking other sources of business with hotel and particular contract business which is quite a bit in the San Francisco market. Also with our sales strategy it is very, very diligent in how they're doing their e-commerce and digital marketing. So, we're starting to see some positive benefits from that strategy.

That's helpful. And Rob, any idea you know how many of those remaining 10,000 rooms you feel like you need to book to hit that targeted RevPAR that I'm just talk about?

Probably about few thousand rooms.

Few thousand, okay, thanks. And then one last one quickly from me is with the like low delay in terms of the transfer of the rooms to HGV I'm wondering what drove that delay and whether there is the possibility for further delays and maybe that's the plateau into 2018?

Hi, Ryan. This is Sean. I wouldn't - short-term delay I think ultimately nothing read into it. Teams in HGV side just want to take little more time to make sure to get it right, the long-term strategy for both companies, they obviously looking to sell some good ocean front inventory and we're looking to reduce the size of the hotel and benefit from the safety owners who will be there and take advantage of the inflow demand that we'll get. So, I think it just again long-term strategy just a short delay to kind of make sure things all right. Likelihood, the way hard to tell at this point I think again nothing dramatic in terms of rethinking maybe the room design or whatnot, so I suspect in Q4 get those projects going.

All right. Thanks guys. That's helpful.

Our next question comes from Jeff Donnelly with Wells Fargo.

Good morning, guys.

Good morning, Jeff.

Just a question on guidance maybe just clarifying something is that EBITDA guidance bolt up at the midpoint really because of the move at the low end, I'm just curious considering much of the revision was the pickup in Hawaii and the Q1 B, why not raise both the top and bottom of your guidance as opposed to just the low end, is that just to be conservative or is there something specific in booking that leaves it to be more cautious?

Yeah, I think Jeff honestly, there's a little bit of conservatism in there, we thought it made sense to pull forward some of it. I think it's important to send the right message to listeners, we are very encouraged by our first quarter. I am proud of the way this team is jelling, it's a high wire act, you may recall now it's been 38 years since I left my former company and joined Hilton and launching this to build out a former and complete team get a board in place and just to see the way we're jelling, I'm very proud. So, I think the first quarter is a solid print our margins were much better than we thought that we're in. but when you look at RevPAR in context and certainly looking at some of the disruptions feel very good about that. So, we thought it made sense to incrementally pull forward again a quarter doesn't make a year, we understand that we've got to earn our stripes every day and this team is working hard to do that. We'll continue to reevaluate guidance each quarter as you know. We don't give quarterly guidance. Second quarter will be more challenging but we are already working our tails off to make sure that we can print positive results for divestitures.

And then maybe as a follow-up and maybe Rob can speak to this as it relates to closing that margin gap, it's your peers I think you mentioned 150, 175 basis points and more over the next two years or so. I know you can't say date and time, but I'm just kind of curious when do you sort of expect that inflection to begin to come through, I know it takes time to turn the ship, but the gap has widened a little bit in the last quarter or two with your peers and I just maybe you can give some expectations for folks, do you think that's going to be more late 2017 or early 2018 when you begin the gain on your peers just curious how you're thinking about it?

Let me get some macro and then Rob can give some of the tactics from strategies that we're employing. Let me be clear Jeff, we are confident that we can close this gap with value creation for investors as significant and we're also confident that we can do this in a spirit of partnership with our operating partners at Hilton. As we've said, you can expect 75 basis points next year than a 100 year after. I would still hold to that, but again the early signs are encouraging. First quarter much better than we thought, again to be just down 10 bps, 10 basis points for the quarter and margins. Rob?

We're really thrilled by first point look at given capital like - such an essential part of our team and just that two great team members who have seriously worked with the floor for season to understand the industry and understand the opportunity ahead of self, so these further get into their portfolios, we expect great results from that. And then Tom spoke about the relationship side of the business we can't speak about that now given that our relationship with Hilton is fantastic, it's very collaborative and it really is alignment of our interest. So, with that, we feel very confident in our ability to move the margins. When it comes to how we're going to do it, we're really focusing on remixing the mix then we wanted to improve our group base for the top 25 hotels want to improve our group margin - group basis by 400 basis points to 35% over the next three years. And we sat with Hilton and looked at over top 25 hotels and set goals with each and every property and how that group room night production is going to be for the next three years, which is then translating back to the hotel teams to say further accept their strategy in general line. We're also adding resources to that which I'm really thrilled about, those are going to be on top of the hotel level. So, essentially 100s taking a look at the portfolio and driving new demand to the assets and essentially taking out lead and train over to the property and then they're going to find additional leads. But as we sit and look at the margins perspective, we really think what we do define few of the areas I think we can be further drive opportunity for…

Well, that's great. Thank you. And actually, can I - where you speak in the third one is just how do the international assets fit into your disposition plans, Tom?

They're part of discussions so that's why I think Jeff it will take a little time. They are it's more complicated there particularly if you wanted to do 1031 type exchange. But we'll have more to speak to that again in the months again probably weighted a little more towards the domestic, but as you know we typically lodging we've haven't gotten credit we're really owning assets outside of the U.S. So, you'll see us the U.S.-centric and we will look to like no load internationally overtime.

Thanks.

Your next question comes from Chris Waranka [ph] with Deutsche Bank. Please go ahead.

Hey, good morning guys.

Good morning Chris.

So, I want to ask you a little bit drill down a little bit on the group up strategy which I think is paying some nice dividends for you. But I mean is there any I mean do we read through from that at all that there is any less confidence or conviction in corporate trends and rebounding as we look at over the six to 12 months?

No, I don't see that Chris at all. I think the thing to keep in mind here is that we start with an iconic portfolio and again we've got 6 assets with over 125,000 square feet of leading space. We got another 25 assets with over 25,000 square meeting space plus or minus across the portfolio. So, when you look at that base, and if we can move as Rob pointed out with the top 25 assets that we can move from 31% to 35% and take less discounted business yield more on catering in food and beverage we can generate tremendous value for shareholders. So, it's just the natural benefit and a national strategy given the strength of our portfolio that natural. I think historically it just wasn't as much focus, it is a strong focus today certainly coming out from the Park team as well as from our partners that at Hilton regarding some of the transient color. If anything, we're seeing raise some rates as sunshine up, it's encouraging staffing I'll let Rob to share few of those with you as we mature sponsor to the Q&A.

Chris, as we if you look at our transit pace for May one of the most positive note is that transit pace for our business dropped for about 4% for May and 8% for June. Not actually continues to year-to-date trend. And as stated earlier, business - during the first quarter of was up 6.5%.

Thanks. That's great color. Follow-up is just the revisit the margin story for a second, not looking for property-by-property breakdown necessarily, but as you go across your top-10 and then I guess maybe if you talk about a Hawaii a little bit. I mean what are some of the pluses and minuses there and does the sale of room to HGV is are kind of an implicit bake in on margin from that is it hopefully shrinks the hotel and get the rates up?

Sure, Chris, when it comes to like Hawaii we think there is an opportunity as we shrink that hotel to further drive rate. We'll have very and we're not to be sign as much groups and that's going to allow us to further drive our rate opportunity. But as we look at our margins throughout the portfolio we really encouraged and as I stated earlier, if we just think the 25 key performance indicators, KPIs, we really believe there is an opportunity to further narrow the gap among the top performing hotels with the most opportunistic hotel

Okay, great. Thanks, guys.

We will take the next question from Steven Grambling, with Goldman Sachs. Please go ahead.

Hey, good morning. Thanks for taking the questions.

Good morning, Steven.

Couple quick follow-ups. I guess on the non-core asset sale program, it seems that - the strategy that there is an expected arbitrage and the value can obtain in this secondary market for as where you can buy in the primary markets. Is that a fair assessment, could you elaborate on the supply demand in bidding, you may be seeing for each of these types of assets?

It's a great question, Steve. And I think there are couple of things to keep in mind here and having done this before with the non-core asset sale, it really will depend on the individual market while the assets with the underlying store is going to be. Some of these hotels we think we can sell unencumbered by flag and management that clearly, I think will appeal of a certain owner operators, there is some obviously that we're going to sell, we can convert to a franchise others that we would look to sell that are going to be encumbered. So, all of that will factor it to the value. I think the greater goal or the more important issue is to think long-term where do we want to be and where do we want to take the portfolio. Again, we start with this iconic portfolio as I said the top 25 assets RevPAR a $182 plus or minus, and obviously that accounts for north of 80% of the EBITDA. So, when we look at those assets in secondary slower growth markets, it's just not a prudent use of capital to continue to invest in some of that's. We'll evaluate again we have identified so far, a short list of 10 to 15, we continue to evaluate that overtime we can look. We think given this thirst for yield so dead markets are still active, private equity is still looking although cautious, but there are players that would be interested in the portfolio of assets that we are talking about. There probably single asset sales could be small portfolios most likely those will be a single asset. In a perfect world, of course you love to be selling those at low cap rates and then buying at high cap rate. I honestly think that will be on a case-by-case basis. There will be some that we'll sell given their quality, given their market that may sell given the capital needs that could sell at a higher cap rates. But we'll evaluate in its totality as we execute plan.

And then you noticed strength in catering and banquet. If you were to adjust for Easter what are you seeing in attendance and spending a group of - if you look out on a like-for-like basis?

Seller, our group catering contributions Steven, it was up 6.6% to approximately $175 for group remain, which is fantastic and we also seeing, when you look at the fourth quarter pickup, we saw 29% pickup, so there if we not said that shows that there is additional attendance are occurring there and the teams were really focused throughout that to gain additional demand through changing our sales strategies. So, we are seeing an increase of business as evidenced by the increasing group catering contribution.

And then very last quick one, if I could. Just on the improved F&B margins. Again, if you were to adjust for Easter and some of the near-term benefits from group. What would that 235-basis point improvement look like and what have been the exclusive things done to make those improvements?

Yeah, Rob, it's exceptional. I think we don't have that information in front of us. I think surprise to say look it's a positive tailwind, but I would also say it's really the hard work and effort of the men and women that are working both on our internal asset management group and partnering with our operating partners at Hilton. So, more to come, but I think a lot of it has to do with the hard work and the initiatives are extensive that we're working. This is a core priority and certainly again as we have outlined if you look at 2017 our key priorities obviously internal growth story on margins and we continuing to look at these embedded ROI opportunities.

Thanks so much.

Our next question is from Shaun Kelly, with Bank of America. Please go ahead.

Hey, good morning guys. A lot of my questions have been touched on. So just one sort of specific one, so, thanks for giving all the additional disclosures in the supplemental. When I was looking through that just was kind of curious on, I notice the sort of non-top 25 hotel properties actually post a really strong RevPAR gain but it didn't look like that filter through the margins so much, I was curious, if there was anything there or any specific reason why some of those markets may have underperformed on the margin front?

I don't think there is anything specific Shaun, it could be some isolated issues here and there. I would say obviously near-term and as we've articulated really focused on the top-25 assets given their contribution to the overall portfolio. We're not neglecting the balance, we will get to them as well with the same level of intensity and discipline, but a lot of our collective energy right now is going focused on those top 25 assets.

Great. Thank you very much.

And our next question is from Lukas Hartwich with Green Street. Please go ahead, your line is open.

Good morning guys.

Good morning, Lucas. How are you?

Good. So, I just have a quick question, Hilton seems to be gaining traction on the direct booking front. And I'm just curious if you're seeing that in your portfolio and if maybe if you can go quantify the impact to you?

Yeah, I would I'd say as you look at OTA just isolated it's about 12% of our business today at a cost of around 13. Obviously, the direct booking is increasing that channels are growing and we're pleased to see that. You're still seeing growth on the OTA side. So, we're watching we're very much partnering with our partners at Hilton continues to force more through the brand that current channels. Obviously, we believe those to be the most efficient and achieve this channel. So more to come on that Lucas and we share that as a key priority anything to get our customer acquisition cost to reduce.

Great. That's it from me. Thank you.

And it does appear, we have no further questions. I'll return the floor to Tom Baltimore for closing comments.

Thanks, all of you. Look forward to seeing many of you at May REIT. And we are excited about Park's future and the men and women here who are and working hard on our behalf.

And this will conclude today's program. Thanks for your participation. You may now disconnect.