Greetings, and welcome to Park Hotels & Resorts Fourth Quarter and Full Year 2017 Earnings Conference Call. (Operator Instructions) As a reminder, this conference is being recorded. I would now like to turn the conference over to Ian Weissman, Senior Vice President, Corporate Strategy. Please go ahead.

Thank you, operator, and welcome, everyone to the Park Hotels & Resorts Fourth Quarter and Full Year 2017 Earnings Call. Before we begin, I would like to remind everyone that many of our 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 our 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 financial information available on our website at pkhotelsandresorts.com. This morning, Tom Baltimore, our Chairman and Chief Executive Officer, will provide a brief review of our fourth quarter and full year 2017 operating results and an update on our capital recycling efforts as well as establish guidance for 2018. Sean Dell'Orto, our Chief Financial Officer, will provide further detail on our fourth quarter financial results, an update on our balance sheet and additional color on our value-add CapEx projects we plan to kick off in 2018. Rob Tanenbaum, our Executive Vice President of Asset Management, will be joining for Q&A. Following our prepared remarks, we will open the call for questions. With that, I would like to turn the call over to Tom.

Thank you, Ian, and welcome, everyone. Our fourth quarter earnings call marks Park Hotels & Resorts' 1-year anniversary as a public company, and I couldn't be prouder of our company's achievements. Over the last 12 months, we successfully spun off from Hilton with a portfolio of iconic, irreplaceable assets with an attractive growth profile. Park offers a compelling investment, providing size and liquidity, an attractive dividend yield and unique growth levers, along with an unwavering focus by management on maximizing shareholder value. Despite some challenges faced throughout the year, most notably the natural disasters in South Florida, the Caribbean and Southern California, 2017 was a successful year for Park and its shareholders. On our inaugural earnings call last year, we spoke about a few key objectives for our first year as a stand-alone company. And I'm pleased we have accomplished a number of meaningful milestones. Our first objective is aligned with our guiding principles of achieving operational excellence. To that end, we've built a best-in-class management team, while also successfully transitioning off of Hilton operating systems. We also made great progress in delivering on our promise of closing the margin gap relative to our peers. In terms of our second guiding principle, prudent capital allocation. We said we would implement an active capital recycling program. And the transactions announced earlier this week show the early results of the tremendous amount of work by our team over the past year. With respect to our third guiding principle of conservative balance sheet management, we have maintained a low levered balance of sub-4x net debt to EBITDA and with significant liquidity of more than $1.6 billion available to execute on our strategy. Finally, and most importantly, we have remained laser-focused on returning capital to shareholders. In 2017, we generated a 13.7% total return…

Thanks, Tom, and welcome, everyone. Looking at our results for the fourth quarter, we reported total revenues of $686 million and adjusted EBITDA of $180 million, while our adjusted FFO was $145 million or $0.68 per diluted share. On a full year basis, we reported total revenues of approximately $2.8 billion, adjusted EBITDA of $757 million and adjusted FFO of $596 million or $2.78 per diluted share. Turning to our core operating metrics. For the full year 2017, our comparable portfolio produced a RevPAR of $163 or an increase of 0.7%. Our occupancy for the year was 81.1% or a slight decrease of 20 basis points. Our average daily rate was $202 or an increase of 0.9% versus the prior year. These top line trends resulted in hotel-adjusted EBITDA of $709 million for our comparable portfolio, while our hotel-adjusted EBITDA margin was 28.1% or a 20 basis point decrease from the prior year. For the fourth quarter, we reported comparable RevPAR of $160 or an increase of 1.7% versus the prior year. Our occupancy for the quarter was 78.7% or 40 basis points higher, while our average daily rate ended the quarter at $203 or an increase of 1.1% year-over-year. These top line trends resulted in comparable hotel-adjusted EBITDA of $175 million, while our margins increased 70 basis points to 27.8%. As it relates to the hurricanes that hit South Florida and the Caribbean, our comparable RevPAR was negatively impacted by 70 basis points, while margins were negatively impacted by 25 basis points. Therefore, backing out the impacts of the hurricanes on our comparable results, RevPAR growth would have been 2.4% during the fourth quarter, while hotel-adjusted EBITDA margins would have been up by 94 basis points. From an earnings perspective, the hurricanes negatively impacted EBITDA by roughly $5.4 million…

Yes. Thank you. Our question is coming from the line of Rich Hightower with Evercore. Please go ahead with you question.

Hey. Good morning, guys.

Good morning, Rich. How are you?

I am good Tom. Thank you. I've got a quick question on share repurchases. So I know that there were some limitations coming out of the spin from Hilton that prevented Park from being able to do repurchases for some time. It wasn't exactly clear, but I'd like a little clarification on sort of where we are in that evolution. And secondly, can you buy shares directly from HNA given the filing last night?

Rich, let me address the HNA question first. And then -- and so you note as well, I want to say for all the listeners that I will note for those on the call that, yes, HNA requested an early registration, and we are presently in discussions with them. Obviously, a registered public offering requires the participation of Park, and we will have no further comment or color to add on this subject at this time. Hopefully, that addresses that matter. Regarding the ability of a buyback -- a potential buyback as it relates to the use of proceeds from our disposition activity, there are limitations, but we are able to buy back stock. Regarding HNA, again, I'll have no further comment.

Okay, that's fine, Tom. And then my second question here, just within the RevPAR in light of the improving economic backdrop and so forth. Some companies this quarter have been willing to sort of give body language around a point in the range that they feel is most likely. Would you be willing to sort of offer that within the range of flat to 2%?

Other than to say, Rich, our practice -- and I have been talking for many, many years is that we typically guide to the middle of the range. And other than that, I would have no additional comment on it.

Okay. Thank you.

Our next question comes from the line of Anthony Powell with Barclays. Please state your question.

Hi, good morning, Apologies, but I have to follow up on HNA for one clarification. Do they need your approval to go through with an offering? Or can they do it without your approval? I just want to clarify that.

Anthony, we try to address it upfront. I think the statement is pretty clear, and I think it addresses your question.

Okay, got it. Just getting to New York, the RevPAR performance kind of improved in the quarter and also the revenue performance outpaced RevPAR. How much of that was due to the amenity fees you've added there? And where else can you add kind of these urban or resort fees across the portfolio?

First, as a backdrop, I'll say, look, we're making, I think, very good progress in New York. Rob Tanenbaum and his team are doing a superb job partnering with our management partners at Hilton. As you know, a complex situation certainly given the amount of supply that's been added there, were long-term believers in New York. I think it's fair to say for this cycle, New York isn't going to certainly be a strong performer. As it relates to the resort fees and other urban fees, they are certainly having a modest impact. We think it's necessary and appropriate, and I think it's a value-added proposition that is being reasonably well received by customers at this time.

Got it. Thanks. And one more is what was the RevPAR growth trends year-to-date, I guess, in January? And if you have February, that would be great, too.

I would say January was better than expectations, and February was slightly below expectations. All things were slightly ahead for the quarter of where we thought we'd be and expect March to be a strong performance across the portfolio.

Great. That’s it from me. Thank you.

Our next question comes from the line of Patrick Scholes with SunTrust Robinson Humphrey. Please proceed with your question.

Hi, good morning.

Good morning, Patrick. How are you?

I am well, thanks. A question that I thought it was interesting, you talked about a little bit of pickup for the group's business in 2018. I wondered if you drill down a little bit, what customer segments are driving that? Any specific regions or hotels? Is this going to be sort of a corporate group? Or is it going to be more the leisure type of group that you're seeing in there?

I do think, and I'll let Rob jump in here in a second. A couple of things. If you remember our last call, we were sort of trending 1% or less. We've seen a nice pickup and now our group pace is north of -- is 3% for 2018. So we're very encouraged by that. I would think candidly a lot of the great initiatives that we're seeing out of Rob and his team again partnering with Hilton. And as you know, we've had implemented a dedicated sales force, some hunters as we're referring to them that are out working hard from that standpoint. And I do think it's been relatively broad no doubt that leisure has been much stronger than business transient. So it's really been a combination of both business and leisure group as well. Rob, anything you want to add?

Absolutely. Patrick, we saw an increase in our group business in San Francisco, HHV and Bonnet Creek. And as Tom alluded to, it comes from all the different markets they have there. One of the things that we're seeing is that in Hawaii, we complexed our 2 [indiscernible] properties into 1. And in the short time that they've been complexed, which resulted in 18 separate groups being cross-sold between the 2 hotels, that's resulted in an incremental 9,000 room nights and over $3 million -- $3.5 million booked for revenue for future years, which we're really excited by. And that's the partnership that we're getting results.

Okay. And then just a technical modeling question on the anticipated receipt of $26 million. Should we just break that out 4 ways for the year?

Patrick, this is Sean. I think that's fair.

Okay. Thank you.

Thank you. Our next question is from the line of Brandt Montour with JPMorgan Chase. Please proceed with your question.

Good morning, guys. So a question on this. Does this fulfill your first round of asset sales as you laid out last year?? And can you help us understand the mix of what you sold versus what you set out to sell? And then what you -- anything you can tell us about kind of how you're thinking about the next round of transactions and how ambitious that will be?

Well, I think we've made significant progress, and I want to acknowledge Matt Sparks and his team and the broader team here at Park. These were, in many cases, obviously noncore assets, assets that were capital-intensive. They were 9 international. The portfolio in U.K. was a very complex transaction, with a very seasoned counterparty and required some structuring issues to manage around. We worked in partnership and aggressively to get that completed. Obviously, the 3 Embassy Suites are just not core holdings for us and where we plan to be investing in the future. Again, as we set our goals for the recycling process, it was to get out of noncore assets, assets that had lower RevPAR. The portfolio of assets that we've sold so far, the 12, are about 35% below the -- our RevPAR average of $162 plus or minus, versus about $105. We also wanted to get out of hotels that we knew were going to require significant capital in the near term. And also, with less distraction of management when you think about when you're managing hotels in South Africa and multiple in Europe and others, it does distract management and we do have other resources that have been deployed against that, so now we can bring some of those resources home and we could focus. I'm very proud, as you recall, we said 10 to 15 assets. We've now sold 12. There is another asset in the pipeline, and I think we've made great progress against our goal. You would expect that we'll continue to add additional non-core assets sort of a Phase 2, but those that have not yet been identified and no additional color to provide at this time.

Okay, great. And then on the $500 million cash available, I know you'll give us more information on the use of proceeds as we kind of go forward. But is there a portion of the proceeds that would make sense to 1031 versus a portion that maybe you don't have -- that you wouldn't be able to do that with? Or can you help us understand that?

Yes, there's -- the Embassy Suites are probably most suited for a like-kind exchange, and that was approximately $96 million. The incremental tax cost, that's probably where you're headed, is about $3 million, again, if we're able -- if we elect to proceed with a like-kind exchange. If we elect not to use the like-kind exchange vehicle, the incremental cost, both tax and a modest special dividend, would be about $55 million or about 15%. So again, we think we have great optionality here, and I also again want to congratulate our team. These were not easy transactions to get done. But hopefully, you've seen again with our spirit, we work hard to do what we say we're going to do. And I'd say we're ahead of schedule on the capital recycling program that we outlined.

Excellent. Thanks, guys.

Our next question comes from the line of Smedes Rose with Citigroup. Please proceed with your question.

Hi, good morning, I just wanted to ask you -- I just I wanted to ask about the Chicago O'Hare. You noted in your 10-K that the city of Chicago won't be renewing the ground lease. So I think that's -- it's not a huge number. It's something like $12 million or $13 million of EBITDA. But I mean does that just go away? Or does it come back to you at some point? Or maybe just a little detail around what's happening with that property.

Yes, Smedes, good question. And I think we've said in the previous calls, but let's certainly make sure we address it here. The current lease expires at the end of 2018. The city has issued an RFP. And essentially, there was not an opportunity for leasehold rights to be extended. So that opportunity will expire at the end of the year. And as you noted, the EBITDA is about 1.7% of the overall portfolio so we do not expect -- and our listeners here should not expect that, that will continue beyond into 2019.

Great, okay. And I just wanted to ask you, do you have -- I know you have some numbers about the room's removal space at Waikolowa. But do you have maybe an updated sense of how many rooms would come out of the property this year in addition to the ones that came out in '17?

Smedes, this is Sean. We moved about 140 or so plus or minus in October. Those are ultimately being renovated or converted to the units and will be -- and then we'll look to sell those over the next 12 months or so. As we've envisioned this, we kind of always thought that once we go over and then they would kind of take the rest. So another 500 -- 450 or so would go over at kind of the end of '19. It depends on the shelf space. We don't have a lot of insight at this point now, but it could be a little bit earlier. But we've always kind of planned towards a kind of final outside of -- end of 2019 where the rest would go away. So it's kind of a 2-phased approach. So no additional rooms in '18.

Okay. Thank you very much/

Our next question comes from the line of Shaun Kelley with Bank of America. Please proceed with your question.

Hi, guys. So Sean, I just want to go back to the tail end of your prepared remarks on margins. You talked a little bit about how you're restating or kind of rebalancing to put yourselves on an more of an apples-to-apples basis, I think, with how peers report some specific line items. I just didn't quite follow it. And could you just kind of clarify that a little bit better? And specifically, I think you said that the gap appears to be the same, but it didn't -- I'm just struggling with how that would actually be the case.

So Shaun, we've normalized an apples-to-apples prior year in kind of comparison not necessarily to the peers. So our actual nominal margin would go up by 60 basis points. So you could have ended at 27.5% this year, but it's ultimately 28.1% as we present it now. So we've closed -- we clearly have closed the gap, but again we're not taking credit for that with the -- within the 175 basis points. It's just a presentation. These cost reimbursements come in at the revenue level and then flow down the expense level. It's very little margin. It's not really core to hotel ops. And so we wanted to just kind of get that visibility remove that to show kind of what [indiscernible] hotel ops are. It's unique to us. It's kind of legacy structured in arrangements within some of these hotels, and that's what we're trying to isolate.

Okay, got it. So basically, the way you present it now is really a clean comp versus peers is sort of the way to think about it?

Correct.

Okay, great. And then maybe just at a high level. Tom, you mentioned the Chicago O'Hare ground lease. Are there any other properties? I mean, obviously there's some legacy assets in here that have just been around for a very long time. Are there any other properties where you could face a similar renewal risk or issue as it relates to a ground lease like this? Or is this just kind of a crazy one-off?

I'd say -- I wouldn't say it's a crazy one-off. It's one that we knew certainly in Chicago. We had hoped that they would continue to pursue a leasehold as opposed to an operational agreement or a management agreement with an operator. City has made that decision and we accept it. I would say a couple of things to keep in mind. Shaun, as you know, is our top 10 assets account for really about 65% of our EBITDA. Our top 25 assets really are accounting for about 85% of the EBITDA. So you do have the barbell effect. And that's further, I think, benefited in this case, given some of the strength of those top 25 assets, given the 12 assets that we've sold. So are there some other leases in there, 1 or 2 that have a shorter duration, meaning less than 30 years or so? Yes, but they're really insignificant to the overall operations of the company.

Okay, great. Thanks very much.

The next question is from the line of Floris van Dijkum with Boenning and Scattergood. Please go ahead with your question.

Hey, Tom. To follow-up on your point about your biggest assets being your the drivers of the value and the growth. If I look -- it appears that your top 10 assets were -- had 1% hotel comp EBITDA growth in the quarter, and the numbers 11 through 25 were down. And then the smallest ones actually have higher growth. Should we expect your top assets to post the highest growth? And is there any more detail you can give maybe in terms of your historical growth or maybe your going forward growth for those assets relative to the rest of the portfolio?

Floris, this is Rob. When you look at the 11 to 25, the majority of the decline was driven by Caribe Hilton's closure. Also, the reach had the hurricane impact and the renovation of Santa Barbara leading to (inaudible). Now this is an interesting quarter when you look at that part of it.

Got it. So what would that look like more on the normalized basis? Would it be more in line with your top 10 you would get?

Floris, this is Tom. I think that's a fair statement. Couple things to keep in mind. Obviously, no secret, urban hotels have been underperforming this cycle, probably 100 to 150 basis points. There's certainly been more supply growth that's been added there. I would tell you that we believe that the top 10 over the long-term, in many cases, are in a fortress position. They're iconic, they're irreplaceable. And over the long term, we fully expect again as supply gets absorbed in certain markets and given the fact that we've had somewhat of an anemic growth here and this recovery as we all know we're now in -- getting to the 9th year and so the 95th month of this cycle but the deregulation in tax reform. But we certainly think this cycle is going to get extended. We also think that we're seeing improved performance which should translate into a better 2018. And we certainly believe to a better 2019.

Great. Thanks.

Our next question is from the line of Chris Woronka with Deutsche Bank. Please proceed with your question.

Hey, good morning, guys.

Morning. Chris, how are you?

Good, thanks. I wanted to ask, kind of, drill down a little bit on the margins. I do appreciate the color you gave us, and it sounds like you're moving forward. So I think you said you're assuming 75 basis points from some of Rob's initiatives this year. So I guess that implies without the initiatives, the margins will be down roughly about 100 bps at the midpoint. Is that math right? And then kind of what are some of the buckets that are maybe impacting that in terms of I assume labor, property taxes and anything else you can identify?

Yes, Rob -- Chris, let me take this first part and make a global statement. And then Rob can drill into some of the details. I think it's important to keep in mind, when you think about our first year, so we were up RevPAR 0.7%, but really down, as Sean pointed out, effectively down 40 basis points. And obviously with the reclass, really down 20. I would respectfully submit for you and for the listeners that is really strong performance in this environment, particularly given how labor-intensive our portfolio is in particular. So I think we're making really steady progress if you look at the 48 bps, a $12.5 million of margin improvement. Last year, we set a goal of -- a stretch of 50. We got to 48. As we look to this year, again, Rob and his team has outlined another 75 bps, approximately $20 million, which are a combination of both revenue and cost. And when you think about this year again, we're seeing saying a midpoint of 1% up in RevPAR. But if you look at margins, we're seeing really down effectively about 30 basis points. Perhaps with one exception of our peers, I would again state, we are doing everything we said we were going to do and making great progress. That takes strong effort from a great asset management team working in partnership with Hilton really grinding out and finding those opportunities. And that comes on the heels of Hilton under the former regime really moving margins about 650 basis points. So I would tell you, we're on top of this. It's an integral part of our internal growth strategy. We're confident in our ability to be able to deliver the 75 basis points this year and again the incremental 100 into next year. So Rob, why don't you provide some additional color?

Sure. Chris, as Tom said in his opening remarks, it really comes down to 6 different buckets there. And as we look at it from a rooms perspective and how we're driving our premium room types, we get pricing differential as well as implementing new room categories. There's $3 million of incremental EBITDA alone from that initiative. I spoke earlier about our consolidation of our sales teams and how we're thinking about driving additional revenues to our hotels. Our 4 business development managers that we've added to the portfolio during 2017 booked $2 million of future business for us. And if you consider 4 people over a 6-month period just ramping up, we're really setting the stage for some great results in the future. And last but not least, when we think about in the rooms side of it, we're also looking to add rooms to our inventory. So we just added 2 rooms at the San Francisco Hilton. Right now, we're renovating the Short Hills Hilton. We're adding 10 additional rooms. And that's on top of 12 rooms that we added at the Bonnet Creek complex in early 2017. From a food and beverage perspective, everything is on the table. We're looking at our optimal offerings at our outlet. We've installed a new software program that's going to allow us to really maximize our menu engineering. And we're also increasing our outlet banquet pricing, which is fantastic as well as installing grab and gos and utilizing multiple ordering systems. But our (inaudible) revenues, that's going to drive another $8 million to -- in EBITDA for us. And as for adjusting our resort fees and offering, we're analyzing our parking rate and renegotiating our contract services with third-party providers and that could be in parking, rooftop and (inaudible) programs and services. And then from a cost-savings perspective, we continuously get benefits of consolidating our management teams in San Francisco and Key West. And we're looking to further refine our outlet and reducing our food cost, and this is something that's really interesting. We've renegotiated both our specifications and our vendors when it comes to food cost. I'm seeing great opportunities for us. And then we're also given the benefit of last year's charge renegotiation. While that will fade away starting in June, we've identified additional cost savings, including the purchasing of linen, additional productivity selling opportunities and leasing out operations. So in total, as we get to productivity alone, another $4.5 million there. So we really feel very confident about all the opportunities that we have going forward.

That's great color, really appreciate it. Quick housekeeping question I think for Sean. The $26 million of business interruption you're assuming in the '18 guidance, how much of that relates to '17 that you're recognizing in '18? And kind of the next part of that is just how much of that might roll into '19 of what interruption you expect in '18?

As we look at the business interruption, Chris, we've kind of looked at kind of what is our carry cost for that hotel while it's under renovation and kind of where we kind of -- where we saw that forecast on a full year basis kind of pretty impacting. We kind of said we're going to assume this business interruption to kind of equate to that bottom line EBITDA number, which is around $8 million. So we may end up getting Q4 proceeds into '18, not knowing that we're going to get the back part of '18 probably to '19. So I think we're looking at a BI claim that's going to extend well north of 12 months. So we're going to bounce it that way.

Okay, thanks.

The next question is from the line of Stephen Grambling with Goldman Sachs. Please proceed with your question.

Good morning. Just got 2 follow-ups. First on capital allocation, you had previously discussed repositioning the portfolio and even potentially taking on some near-term dilutive transactions at some point. How do you view the current market for assets in terms of potential assets for acquisition? And what are the limitations to think about in terms of if you were to take on some near-term dilution? Thanks/

Stephen, we've had this question before as we've -- as I outlined in the prepared remarks, capital allocation is one of our fundamental tenets, a real cornerstone for us. We think about it very carefully and prudently when you look at obviously the proceeds that we have available from our disposition activity. And there are deals in our pipeline that we're certainly looking at. And we want to balance one redeployment of capital, but making sure that while there might be a slight dilution in the near term, that it's not significant and most importantly, it's going to be accretive over the intermediate long-term of both FFO and equally importantly, to NAV. So it's one that we'll look at. And when you look at sort of where we're trading when you're comparing buying assets to where we're trading today from an NAV and we're probably trading at north of 30% discount. So you certainly have got to compare those activities versus the opportunity to buy back our stock with some of those disposition proceeds. So we'll continue to evaluate and monitor market conditions, and we'll continue to look prudently for assets again that are compliant with our strategy. As we've said, we're really focused on improving the overall quality of the portfolio and adding assets -- upper upscale and luxury assets in top 25 markets and premium resort destinations. So we're excited about where we sit today as we begin our second year as a public company and we think we've got optionality. And candidly, we think we're really hitting on all cylinders on all the things that we said we'd do. And I'm proud of the team and where we stand right now.

And just a second follow-up just on the margin guidance, and I appreciate the color earlier. But I guess I want to be clear. On the 75 basis points of margin expansion, that's relative to peers on the same kind of RevPAR growth basis? Or is that just in aggregate?? And can you just give us a little bit better of a sense for what underlying wage inflation is and maybe any kind of margin sensitivity if we do get an acceleration in RevPAR?

Yes. I -- let's talk about sort of pressures that I think -- 3 pressures that everybody is sort of facing like wage pressure for sure, property insurance. I think candidly, as Rob pointed out earlier, we've largely dealt with that first half of this year. The renewal is midyear. Despite some of our peers, because we do get to stay the additional year in Hilton's global program, we think actually that the increase to us will probably be less than many of our peers. And then, of course, the third which we are seeing the impact of cost pressures clearly on a property tax side. You take Chicago as one example. Accounting for the performance there, we're seeing probably a 17% increase plus or minus, certainly north of the $1 million increase there in property taxes. So all in, you would need hypothetically for revenue to be growing at probably a 2.5% growth rate to sort of keep margins flat. I think that only reinforces the strength of our team and the great progress that we're making. Again, looking at last year when we're up RevPAR 0.7%, but really effectively margins were only down 40%, 40 basis points before obviously the reclass to 20. And if you look this year, again with the midpoint, we're looking at being down 30 basis points. Now if we just run ahead of where we think we do have some new renegotiations this year, but candidly, that's really baked into our analysis. And we're very comfortable with the guidance that we've provided at this time.

Our final question today comes from the line of Robin Farley with UBS.

Great. I just wanted to -- it's a follow-up question (inaudible). The first is I wonder if you could just sort of quantify how much of the proceeds -- the dollar amount of proceeds would be available to be used for share repurchase, that and combined with other liquidity that you have. So what would the total dollar amount available be for you to use for share repurchase without any tax consequences?

As I said earlier, Robin, if we were to do a like-kind exchange, effectively we have approximately the entire $379 million. There would be some incremental kind of operations and costs related to those transactions. So it would be probably about 300 -- net $362 million approximately. Again, if we elected not to use for a like-kind exchange, we would certainly have north of $300 million. But the friction costs, both taxes and a potential special dividend, would impact by about $55 million or about 15%. So it would be somewhere between $300 million and probably $315 million approximately that would be available.

Okay, great And on the margin question, just circling back to your guidance. When you look at -- to the pieces where you're selling the 12 assets that I would assume were lower-margin assets, how much of that is -- in other words, is that some of the 75 basis point improvement you're baking in? Or if not, how much is that impacting your margins, all else being equal, just by removing those 12 assets? And then I also -- the other piece that's changing your EBITDA year-over-year is the chunk of business interruption insurance, which is about equal to maybe the EBITDA of the properties that are getting sold this year. But I would think that insurance proceeds would be kind of extremely high margin the way it would run through EBITDA margins. And so again, how -- is that factored into -- I guess to what degree is that in your basis point improvement?

Yes, Robin, let me try to set the stage a little bit there. Let's keep in mind that out of the assets we've sold, we're losing here $33 million approximately of EBITDA of noncore assets, much lower RevPAR, about $106 RevPAR versus the portfolio average of $162 obviously before selling those hotels. They also had an EBITDA margin of approximately 25.6%, so 250 basis points below the portfolio average. So whether we elect to redeploy that in an asset buyback, we're confident that we'll improve the overall portfolio. If we elect to use part of the proceeds -- the disposition proceeds for a potential buyback, we certainly think that, that will be accretive given where we're trading today. Regarding the insurance, as Sean outlined, the insurance effectively, if you look at Caribe, the contribution last year was only $5 million in EBITDA. Based on when it closed, the run rate -- the recent run rate has been about $8 million in EBITDA. So the lion's share of the $26 million really goes back to pay the carrying cost. So we're not -- there's no funny math here, just so that we make that clear. There's about $14 million of operational carrying cost, and then there's some incremental fees of course that would have to be paid to the manager. So you're really replacing the $8 million that we've lost. We're very confident, given the scope of the renovation at the Caribe that we're effectively going to get close to a new hotel when she reopens later this year. And by the way, that will be around her 70th anniversary, which is one of the oldest and one of the early Hilton hotels in the overall portfolio and the overall brand. So we're really excited about that. So we see that being accretive and really creating value for shareholders over the intermediate and most importantly over the long term.

Okay, great. Thank you.

At this time, I will turn the floor back to Mr. Baltimore for closing remarks.

Thank you all for taking the time. We look forward to seeing many of you in the very near future. And I look forward to our future discussions at our next call in late April, early May. Happy spring to everybody.

This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.