Welcome to the RLJ Lodging Trust Second Quarter 2024 Earnings Call. As a reminder, all participants are in a listen-only mode and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. [Operator Instructions] I would now like to turn the call over to Nikhil Bhalla, RLJ Senior Vice President, Finance and Treasurer. Please go ahead.

Thank you, operator, good morning and welcome to RLJ Lodging Trust 2024 second quarter earnings call. On today’s call, Leslie Hale, our President and Chief Executive Officer, will discover key highlights for the quarter. Sean Mahoney, our Executive Vice President and Chief Financial Officer, will discuss the company’s financial results. Tom Bardenett, our Chief Operating Officer, will be available for Q&A. Forward-looking statements made on this call are subject to numerous risks and uncertainties that may lead the company’s actual results to differ materially from what had been communicated. Factors that may impact the results of the company can be found in the company’s 10-Q and other reports filed with the SEC. The company undertakes no obligation to update forward-looking statements. Also, as we discuss certain non-GAAP measures, it may be helpful to review the reconciliations to GAAP located in our press release. Finally, please refer to the schedule of supplemental information, which includes pro forma operating results for our current hotel portfolio. I will now turn the call over to Leslie.

Thanks Nikhil. Good morning, everyone and thank you for joining us today. We were encouraged to see the industry’s RevPAR growth sequentially improve during the second quarter. Despite a choppy backdrop, the urban and top 25 markets once again led the way, which enabled us to achieve solid operating performance. Additionally, during the second quarter, we were active on a number of fronts, including acquiring Hotel Teatro in Denver, progressing on our 2024 conversions, as well as recycling proceeds from the sale of a noncore asset into opportunistic share repurchases, while increasing our quarterly dividend. Overall, we were pleased with our results. Specifically, for the quarter, we achieved RevPAR growth of 2.6%, which was driven by gains in both occupancy and ADR. May was the strongest month of the quarter with 6.9% RevPAR growth, while June achieved positive RevPAR growth. Despite the impact from the Juneteenth holiday and several weather-related events. This quarter, our market share expanded by a robust 170 basis points, underscoring the relative strong performance of our portfolio. Our urban portfolio continues to benefit from all segments of demand, with growth in business and group demand, driving robust RevPAR growth in our markets such as Boston, Denver, Los Angeles, San Diego, Miami and New York, while Atlanta and Austin were held back by a renovation in each market respectively. Relative to segmentation, BT was once again our top performing segment during the quarter, generating outsized revenue growth of 13%, balanced with an 8% increase in occupancy and a 4% increase in ADR as business travelers continue to expand their travel frequency. Corporate demand benefited from the ongoing expansion of travel from large corporations and resilient demand from the SMEs, which resulted in our midweek RevPAR growing by 4%. Our group segment had another solid quarter, achieving revenue…

Thanks, Leslie. To start our comparable numbers include our 96 hotels owned at the end of the second quarter and include the acquisition of the Hotel Teatro in Denver, which we acquired during the quarter, and exclude the Residence Inn in Merrillville, Indiana which was sold during the second quarter. Our reported corporate adjusted EBITDA and FFO include operating results from all sold and acquired hotels during RLJ’s ownership period. As Leslie said, we are pleased to report solid second quarter operating results which were in line with our expectations and demonstrated the strength of our high quality urban centric portfolio. Our second quarter RevPAR growth of 2.6% accelerated from the first quarter and was driven by a 2.1% increase in occupancy and a 0.6% increase in ADR. Second quarter occupancy was 76.7%. Average daily rate was $205 and RevPAR was $157.30. As was noted, our business transient and midweek outperformed. Second quarter business transient RevPAR grew 12.7% above 2023, including ADR growth of 4% and occupancy growth of 8%. RevPAR growth remained healthy in our urban markets such as Boston at 10%, Denver CBD at 6%, Indianapolis at 27%, Los Angeles at 7%, San Diego at 24%, Miami at 19% and New York at 9%. Monthly RevPAR growth during the second quarter was down 0.2% in April, primarily due to the impact of Passover and up 6.9% in May and 1.2% in June, which was constrained by the midweek timing of Juneteenth. Total second quarter revenue growth of 3.4% outpaced RevPAR growth by 80 basis points and benefited from 6.5% growth in non-room revenues. Monthly total revenue growth was 0.7% in April, 6.9% in May, and 2.5% in June. Looking ahead, we expect the operating trends from June to continue in July where RevPAR is forecasted to increase between…

Thank you. [Operator Instructions] First question Michael Bellisario with Baird. Please go ahead.

Thanks. Good morning, everyone.

Good morning, Mike.

First question on your guidance kind of focused on the second half. What’s the macro backdrop that you’re assuming at the low end versus the high end, and sort of what are the risks that you’re baking in that range and then what would need to happen to be at kind of high end versus low end?

Yes, so, Mike, the way that we sort of thought about our range is that clearly there are signs that the economy is slowing. More signs came out this morning. We said that if the Fed was successful, that obviously travel wouldn’t be immune to being impacted. The signs of it is affecting largely on the leisure side and obviously on we’re seeing and in rate mostly driven. Our original range assumed at the low end that the economy slowed down. Our current range book-ins [ph] the low end of our original range, and it assumes, obviously, that it’s largely rate driven. And that’s baked in all of our guidance. If we think about it from a standpoint of segmentation, clearly leisure has been widely discussed. We’re seeing the same thing that everybody else is seeing in terms of the consumer booking through discount channels, as well as booking not as booking as early as they were before and booking later. And that’s obviously translating into rate coming down on resorts weekends however you sort of cut and look at it. If we think about it from a BT perspective, our midpoint of our range still assumes that BT grinds forward. From a standpoint of who’s booking, the frequency, the length of stay we’re still continuing to see Monday and Tuesday, Wednesday move forward. The GDS still demonstrates that national accounts are continuing to increase and that SME’s remain strong. What’s different for us relative to our guidance is that we previously assumed that the rate between – the difference between the rate of BT and group would converge. And what do I mean by that? Is that historically, historically, the gap between BT and group, BT was about 10 points to 15 points ahead of group. Today BT is…

That’s helpful to bookend it. And then maybe for Tom, just on the reduced weekend and leisure rate outlook is that broad-based across the portfolio for what you’re seeing? Any particular channels stronger or weaker? And then is there any directive on your end to your operators in terms of revenue management to try to group up more to offset some of that leisure demand and pricing sensitivity? And that’s all for me. Thanks.

Sure, Mike. So if you think about leisure markets, where we’re seeing the price sensitivity, there’s a couple things that I would say when you look at South Florida, Key West, Orlando, when you look in general, where leisure is shifting, and the other thing that we’re noticing, because we have some hotels in Fort Lauderdale, is the cruise industry is doing very well. For instance, pasture volumes up about $31 million in 2023, surpassing 2019 by 7%. So there’s a movement to cruise. And what we’re finding on weekends is it’s harder to get rate. Even though demand is there, you’re having to make sure that you’re priced appropriately to be able to get that demand. Another example, we were with Marriott the other day and we were looking at redemptions. Redemptions are down. So we’re trying to think through how to make sure we revenue manage the weekends, knowing that it’s a little bit different in regards to who’s coming and when they’re coming. And Leslie even referred to when they’re booking. To your point, we are absolutely changing and shifting to make sure that we’re loading a little bit more group on weekends, you can see that not only group is up in demand, but it’s up in rate. And the focus has been on making sure that we’re booking more. Whether it’s Smurf or weekend groups, special event groups, everything we can do. The group, small group that Leslie referred to though, is corporate groups. So we’re still at about 50% of our group is corporate. And that’s where we’re seeing not only the BT, but the corporate group continuing to kind of grind forward. And that’s helping us in banquets as well, AAV [ph] room rental. And so from a profitability standpoint, we’re focused on the right types of groups to drive profitability. And hopefully that helps you answer a little bit that it’s not completely broad based, but it’s definitely in pockets where rates were a little bit more significant year-over-year.

And the thing I would add to your Tom’s comments, Mike, is that obviously, as we’ve talked about before, 58% of our business is booked between zero and seven days. We’re now starting to see more skewed to zero to three within that range. So it gives you a sense of how short the bookings are and how the revenue management has to be thoughtful, you know, as we go forward.

That’s all helpful. Thank you.

Next question Gregory Miller with Truist Securities. Please go ahead.

Thanks. Good morning, all. So this is a related question on your full year outlook, given the guidance cut, I’m curious about your conversations with your operators in terms of when they started to see this degree of leisure softness. And I mentioned that especially relative to your full year guidance that was reiterated last quarter and with no clear adjustment at June NAREIT. Thank you.

Yes. So, Greg, I think your point is well taken with respect to, as you know, there are things, there are initiatives that we will put in place in conjunction with a softening economy. And so Tom mentioned on the revenue management side, certainly grouping up contract business, et cetera, to make sure that we build a good revenue base, as importantly in this type of environment is to make sure that we are aggressive on monitoring costs within the business, particularly wages and benefits, which are 40% of our total costs, and so making sure that those costs are flexed accordingly to the new revenue outlook. And so I think that’s an asset management initiative as well to help mitigate some of the impact of the softening economy, which is reflected within the guidance ranges.

And I’ll just remind you, Greg, when we were at NAREIT, we were a week after the best month of the year in May. And so as we just talked about the booking window, when you’re coming off of a pretty significant growth month, we were encouraged. And then obviously we ran into Juneteenth, which was a shift in regards to what happened that week with BT and had to bounce around it. But I would say weekends, really, it’s starting more in June and July where you’re starting to see the sensitivity when you look at Friday and Saturday, even in the quarter, when we look at rate sensitivity, it’s more on Friday, Saturday, where most of our RevPAR growth is midweek. So we are reacting quickly and we’re making sure that all our management companies are very aware of the revenue management strategy. And the good thing is our booking window is pretty short, so we can make some things happen quickly versus having to not being able to pivot, when things are adjusting.

Yes. And I think the thing I would add, Greg, is that what we said on our last call was that as we moved into the summer that we would have greater visibility. And here we are with that visibility and able to reflect that in a thoughtful way within the guidance that we provided.

Thanks all. And as for my follow-up, this is similar to Mike’s question, and it’s about the channel mix. In past cycles, when there’s been some softness, the OTAs have taken additional share. And I think about this also from the perspective of your net RevPAR. Do you anticipate, just given the leisure softness today, that the share of demand from the OTAs is increasing or will increase for weekend demand and your leisure overall?

Well, the way I think about it, Greg, is OTAs are an additional avenue and they certainly lean towards weekend. When you look at percentage of total. What we have seen, and these are all the reports that we’ve seen from Marriott, Hilton and Hyatt for our premium brands, that the percentage is remaining the same. What I would say though is because you are needing to rely on that based on filling the house, if you will. Going back to my comment earlier about redemptions, we definitely need to turn on the valve, but we’re not seeing an increase in OTA. The other thing that I would say is we are making sure when we’re pricing ourselves, we’re thinking about what our best available rate is because many of our discounts, whether that’s AAA, AARP, everything related to leisure is properly positioned. So when you think about trying not to give up too much rate, you can get people buying discount further out, but position it off of a bar rate that is reasonable so that people are still paying a decent rate coming in, that’s where the demand continues. But you got to vacillate on what rate you’re getting further out as well as that closer in booking. And so I think OTAs are going to be consistently around the same. I don’t see it as growing, but I would say that we are making sure that we’re spending some digital marketing to enhance the ability to make sure the demand continues.

And the one thing I would add Greg to Tom’s comments is that on the leisure side, we’re seeing our leisure risk and the adjustment driven by ADR, not by demand. Demand in leisure remains healthy. And so with a healthy demand, that would lead you to believe you didn’t have to have a significant adjustment to your channels, to a more discount channel, right, because the demand is there. It’s just a function of the pricing sensitivity from the leisure customers driving it.

And the last thing on channel distribution, Leslie made a comment earlier, GDS is up. That’s a direct relationship to national corporations. The other channel that’s up is property direct. That’s related to how many people are putting groups in and rooming lists. And then the other thing that I would also point out when it comes to channel is we’re really making sure we’re monitoring the ability to put our payroll against where we think there’s opportunity to grow market share. Leslie mentioned we were growing market share to 170 basis points. Well, there’s national corporate, then there’s local corporate negotiated. We’re seeing growth in local corporate because our payroll is finding business that’s in the local market that we’re negotiating to make sure that we’re taking share midweek, which is where the most amount of growth is.

Okay. I appreciate all the color. That’s all for me. Thank you.

Next question, Tyler Batory with Oppenheimer & Company. Please go ahead.

Good morning. Thanks for taking my questions. A lot of interesting commentary here. Leslie, you made note of the gap, the rate gap between business transient and group. Can you explain that a little bit more? Why is there such a big gap? Why hasn’t it converged like you expected? I’m assuming there’s some mix that’s going on, maybe that’s impacting that. But if you could go more in depth and explain that comment some more, that would be helpful.

Yes, sure. I mean, I think, Tyler, I think the historical relationship was that BT was your highest rated business, then group and then leisure. I think the new normal has shifted, right? As we know, leisure was strong to come back, group was second, and now BT is still ramping back. Your highest rated customer is just now coming back in the kind of the last 12 to 18 months, plus or minus. And so it’s been slowly grinding forward as we figure out the new normal between BT traditional and I would say leisure. All of those things are playing into a role. I think also just leisure has been so strong and so that sort of has shifted the dynamic. We’re not suggesting that BT is going to get back to the same historical relationship. We just know what you do better. And so whether close the gap means completely or incrementally, our general house view is that it should do better on that. And so that’s how I sort of think about it.

The last thing I would add is you have to also pay attention to your best available rate. Remember, over the last couple of years we’ve been talking about dynamic pricing and we’ve seen growth in the amount of demand that’s going into that category because the national corporate accounts weren’t coming back, but you had more SMEs who didn’t have a discount or a fixed rate going into that category. And so that’s where the pricing power was and the demand still has shifted. So your best available rate has been the highest rate that we’ve had. And therefore, now that you’re getting more corporate coming back, you’re seeing that demand come with increases that you’re getting on the national negotiated rates for those companies.

Okay. Some clarification questions, too. Rough numbers, what percentage of your overall mix would you categorize as leisure? And what’s really your definition of leisure? I know it’s a little bit of an imperfect science here, but is it just weekend business? Is it coming to the resorts? Just trying to get a sense of being as particular as we can in terms of what you’re trying to communicate in terms of the leisure travel trends.

Yes. So we’ll tag team on this one. Tyler. I would say that historically, our mix was 20% group, 8% transient. Of the transient, it was 55% BT and 45% leisure. We think today that that transient mix [ph] is probably 50/50.

And then when you break down, obviously, if you look at transient on weekends, pretty much it’s all leisure. And that would be anything that’s booking on those weekends. I would also say you can look at rates that are discount rates that would travel midweek or weekend would also be in the leisure category, Tyler. And so we look at things that I was just mentioning, AAA, AARP, where you can code to leisure. So we define it based on what the people are saying. They’re there for business or pleasure.

And we can also look at markets that are better indexed to leisure as well. So there’s lots of different ways to cut it.

Okay. All right. Perfect. Okay. That’s all for me. Thank you.

Next question, Dori Kesten with Wells Fargo. Please go ahead.

Thanks. Good morning. You’ve been talking more about acquisitions over the past few months. Has your acquisition pipeline been growing, or would you describe it as more stable at this point? And then just as a follow-up, are there certain markets that you think would benefit from more clustering of your assets?

Sure. In terms of pipeline, our team is always underwriting Dori, and we’re always having conversations. We focus on off market transactions that generally take longer to curate. What I would say is that, as we’ve talked about on our previous call, that we’re very much focused on assets that have unique situations. And so that’s a smaller subset of our overall pipeline. And I would say that’s generally been stable.

Okay. And then you’re bringing in Sage, who’s a well-known operator in the U.S., but particularly knowledgeable about Denver for Hotel Teatro. Is getting to the 10% stabilized yield more of a top line driven thing, or does it lean into greater efficiencies?

I think it’s all of the above. I think that the upside is largely baked in the operating side of the equation, both top and bottom, by bringing in an institutional quality manager, by using aggressive asset management, and as well as looking at all the unique opportunities for ROI. All of that is driven on the operating side, whether it’s a function of bringing in Sage, who has obviously the dominant player in this particular market and has subject matter expertise and clustering capabilities there as well, in addition to our natural lens on how to add value to a hotel, all of those things are operational based, top and bottom.

Okay. And then the asset you sold in Indiana this quarter. I might be wrong. I’m just guessing it’s from the original white lodging portfolio from, I can’t remember, 2005, 2006. The portfolio has changed quite materially over the last 15 years, like RLJ has. Can you just remind us how many of those original hotels from back then are still within RLJ today?

Yes. I don’t have a number to give you, Dori, but what I would say is that we did a lot of heavy lifting in 2019, where we sold a lot of assets and so reduced the number of assets from that portfolio. But by and large, we’re generally pretty happy with our overall portfolio. And what I would say is that we just have a handful of non-core assets out of a portfolio of 96 assets. You’re always going to have a bottom end of your portfolio. And so we have a handful of non-core assets. This is really kind of brick and mortar, in our portfolio and not stick billed assets. This was an asset that we dealt with unencumbering so that we could execute a transaction, and then we were able to get it done in an accretive fashion. But I would say, by and large, just a handful of assets that we have left that would consider non-core from that portfolio.

Okay, understood. Thanks.

Next question Floris van Dijkum with Compass Point. Please go ahead.

Good morning. Question on capital allocation. Maybe, Leslie, if you could talk a little bit about the balance between new investments, share repurchases, obviously you return some capital via higher dividend. How do you see that in light of certainly where your share price is trading today?

Thanks, Floris for the question. I think this quarter really represents a perfect example of what we’ve consistently said. Our balance sheet gives us the optionality to pull more than one lever at a time, and you’re always looking for the right window to be able to do that. And the volatility this quarter gave us the ability to do that. As you mentioned, we were active on a couple fronts. One, we obviously recycled the asset that we just got through talking about and took those proceeds and bought back shares accretively and on a leverage neutral basis. We also continue to invest in our portfolio. And our conversions have been very successful. And we’re on a cadence of two per year. And then we increased our dividend as well, as well as we executed on the acquisition of Teatro. When you actually look at the capital allocation between the dividend and the buyback, it’s pretty equal to what we paid for on Teatro. So it was about a well-balanced allocation. We may remain constructive and we are going to be disciplined about it, but we do recognize that in this climate, that obviously buybacks remain very attractive.

Great. And then maybe if I could follow up on the cash. Obviously, you got $375 million of cash still left on the balance sheet. Remind us again how much you plan to spend on for the rest of this year and in terms of conversions and then potentially what you have in the pipeline as well?

Yes, I mean, Floris. So the $100 million to $120 million of CapEx that we talked about for the year is inclusive of ROIs, conversions, et cetera. We’ve spent year-to-date, a little more than half of that. And so you would expect us to spend the balance of that capital during this year. I think when you look, sort of long term, and as we’ve talked about historically on the liquidity that we have provides us the optionality to pull the right lever at the right time. And we’ve done that. I think on, we’ve in, on past calls, we’ve talked about being an all cash buyer, has positioned us as an enviable position when it comes to acquisition opportunities. Obviously the, we are going to be disciplined on that today, and we’re going to be cognizant of the cost of capital elsewhere within our options. But I think our liquidity is a competitive advantage today. So I wouldn’t view it as what we have to spend. I’d view it as what liquidity we have to provide as optionality.

Thanks, Sean.

[Operator Instructions] Our next question comes from Chris Woronka with Deutsche Bank. Please go ahead.

Hey, good morning, everyone. Thanks for taking the questions. So, Leslie, I want to maybe follow up on something you mentioned earlier, which was that the booking windows are, I think you mentioned, kind of trending towards the lower end of the historical range. I guess if you look back and 2020 is not going to be the right example, but maybe further back. Is that indicative of – is that kind of like the first shoe and then we just see further demand weakness? Or do you think that that booking window shrinking can be transitory?

No, I think that, historically, I think on a sort of pre-COVID basis, it was about 51% was booked in the zero to seven days, and now we’re at 58% in the zero to seven. So, I think we’re kind of a little bit in a new normal. Technology has improved, transparency has improved. So I don’t really see it as a canary in the coal mine at all. I think it’s just behavioral, and you have to be able to revenue manage around it, which I think that, we are pretty sophisticated and understand how the market, understand how the consumer behaves. And so from our perspective, we just have to be nimble and respond to it. I don’t see it as a Canary [ph] coal mine.

Okay, fair enough. And second question is just kind of, if you were hypothetically, if you were to see further weakness develop, hopefully you won’t. But are you prepared to go back to the brands that gave you a lot of flexibility during COVID. Would you ask for, do you think they’re in a position to give you a lot of flexibility? And also, are you guys able to – you’re running pretty efficiently right now, as far as I can tell. Are there still things you would look to do if RevPAR softens from here? Thanks.

Yes, I would say that we appreciate that, that the economic backdrop is showing some signs of softness. We do still continue to expect a soft landing. Keep in mind that we learned to navigate and operate in a zero revenue environment through COVID. So there are lots of tricks in the bag that we have today that we necessarily have, five years ago. And so we think our ability to navigate the current environment, even if it’s softens further, is at a higher degree today than it probably ever was. And so we feel pretty good about being able to navigate in this environment. And I don’t think we have to go back to the brands.

Yes. And then, Chris, with respect to efficiencies, we do think the second quarter is the high water mark with respect to the year-over-year cost increases. And the reason why we believe that is really, you can break it into two buckets. The first is the fixed costs, which are primarily property insurance and taxes. Our property insurance renews in November. We would expect to have a successful renewal there, and there’ll be an ease of premiums as part of that renewal in November, which will have a benefit to the fourth quarter. In addition, we didn’t have any property tax adjustments this quarter or last quarter, but you would expect us to be aggressively fighting to make sure we’re minimizing property taxes. And we think that becomes less of a headwind in subsequent quarters. And so that’s why in my prepared remarks, I said I expect the fixed cost increases to weighing that 500 basis points to 600 basis points. The second item is on wages and benefits. Our wages and benefits. There’s opportunities there. So they were up sort of in the mid-single digits this quarter, but this quarter reflects a shift back from a higher contract labor percentage to more full time employees. We had a roughly 25% reduction in contract labor this quarter. And so what that has shown up in is an increase in the benefit side, which was up in the low teens in the quarter. But what the quarter doesn’t have and where the opportunity is, is that you get efficiencies with a full time employee versus a contract labor employee that we’ll be able to see in future quarters. And so we feel good that will have much better year-over-year comparability on our operating expenses relative to what we saw in the first half of the year.

Okay, very good. Very helpful. Thanks, Leslie. Thanks, Sean.

Next question Chris Darling with GreenStreet. Please go ahead.

Thanks. Good morning. A question for Tom, probably can you speak to what you’re seeing on the ground across the Bay Area, and maybe if you could delineate any comments between, Silicon Valley relative to San Francisco proper and the East Bay.

Sure. Good morning, Chris. I’ll start with the good news. Let’s go to Silicon Valley. We have definitely seen a little bit more project business come back. The back to office has helped. We’re seeing a longer length of stay because we’ve got quite a few Hyatt houses out there, Chris. And so we’ve seen return from either Tesla. We got some accounts that have actually had 14, 15 rooms for 28 days to 35 days, and we hadn’t seen that last year. So we’re seeing a nice increase. The other thing that I think we’re seeing in Silicon Valley, where we spent a little bit of capital, we’ve seen a nice uptick at our Palo Alto, which is close to the Stanford University, and we’re seeing business come back to us knowing that we put the capital in. And that’s kind of been helping cause as well. When you go closer to the area of CBD. We work towards the airport and what we are seeing there is we’re getting international contract business and we’re seeing more AI business from consultants come to the airport location. And we have an embassy at Waterfront, an embassy at south. And those areas have been growing share in addition to seeing some volume increase when you get to the CBD area. That’s a whole another game right now. We all know that the year was set up where the first half was going to be better than the second half. We’re encouraged that 2025 will be better than 2024. We’ve got some special events that we’re leaning in on, like the NBA All-Star Game as well as the, there’s a sailing event that takes, place in the summertime. But we do have a little bit of a harder setup for fourth quarter this year as well as third quarter because of citywide. And everybody’s kind of talked about Moscone as being this is going to be the tougher year between 2024 versus 2025. And that gives you pretty much around the bases, if you will, of Northern California.

Okay, thank you for that. And then just another quick one for me. Shifting gears maybe for Leslie, as you kind of have conversations with various individuals in the market thinking about the transaction market, any change in buyer seller expectations, in this slower kind of demand backdrop the last couple of months that you could speak to?

No, Chris, I think not much has really changed, since our last call. The volume remains constrained. It’s marginally better. There’s activity pickup around BOVs and sort of soft conversations. But I would say that, given the fact that debt is available but expensive, the general perspective around rates coming down, low levels of supply, and people focus on TTMs, there still continues to be a gap and sort of bid ask, but we will see how that sort of shapes up in the back half of the year. But by and large, that really hasn’t changed since our last call.

Okay, understood. Thank you all for the time.

Thank you. I would like to turn the floor over to Leslie for closing remarks.

Thank you everybody for joining us. We hope you have a great rest of your summer and that it includes some level of travel.

This concludes today’s teleconference. You may disconnect your lines at this time and thank you for your participation.