Ladies and gentlemen, thank you for standing by. Welcome to the Sunstone Hotel Investors Third Quarter Earnings Call. [Operator Instructions] I would like to remind everyone that this conference call is being recorded today, November 12, 2013. I will now turn the conference over to Mr. Bryan Giglia, Chief Financial Officer. Please go ahead.

Thank you, and good morning, everyone. By now, you should have all received a copy of our third quarter earnings release and our supplemental, which we released yesterday. If you do not yet have a copy, you can access them on our website at www.sunstonehotels.com. Before we begin this call, I'd like to remind everyone that this call contains forward-looking statements that are subject to risks and uncertainties, including those described in our prospectuses, 10-Ks, 10-Qs and other filings with the SEC, which could cause actual results to differ materially from those projected. We caution you to consider those factors in evaluating our forward-looking statements. We also note that this call may contain non-GAAP financial information, including EBITDA, adjusted EBITDA, FFO, adjusted FFO and hotel EBITDA margins. We are providing that information as a supplement to information prepared in accordance with generally accepted accounting principles. With us on the call today are Ken Cruse, Chief Executive Officer; John Arabia, President; Marc Hoffman, Chief Operating Officer; and Robert Springer, Chief Investment Officer. After our prepared remarks, we will be available to answer your questions. Before I turn the call over to Ken, I'd like to remind everyone that with the beginning of this year, we adopted calendar reporting quarters for our 10 Marriott managed hotels similar to the rest of our portfolio, which also reports on a calendar basis. Last year, reporting for our Marriott managed hotels was based on a 13-period fiscal calendar. As a result of this calendar shift, our revenues, net income, adjusted EBITDA and adjusted FFO for Q3 2013 include 8 additional days of operations for our Marriott managed hotels as compared with Q3 2012. With that, I'd like to turn the call over to Ken. Please go ahead.

Thanks, Bryan, and thank you, all, for joining us. Given the late timing of our call and since we have already preannounced our quarterly results, we'll keep our prepared remarks very brief today. I'll quickly walk through some high points on operations, and I'll provide a status update on our recent Boston Park Plaza investment, as well as our pending acquisition of the Hyatt Regency San Francisco. Finally, I'll conclude our prepared remarks with a discussion on leading indicators before opening up the call to questions. First, with respect to the third quarter, our results exceeded our prior guidance in all areas. This was a model quarter in many ways. Our hotels achieved strong revenue growth in both rooms and food and beverage and our margins expanded materially due to disciplined expense controls at both the departmental and G&A level. Specifically, our comparable RevPAR grew at a healthy 7.6%, while our same-store hotel EBITDA margin expanded by 220 basis points. This strong hotel level performance led to a better than 30% increase in our adjusted FFO per diluted share as compared to the third quarter of 2012. We're now seeing solid trends from a broad range of demand segments. The ongoing resilience of the U.S. business travelers, our largest component of demand, is now being augmented by strengthening group booking activity and positive corporate account negotiations. Moreover, as expected, our recently renovated hotels are generally growing at rates above our portfolio average as we trade renovation displacement for outside's growth. Specifically, for the third quarter, our Renaissance Westchester delivered nearly 9% RevPAR growth. Our Hyatt Newport Beach delivered nearly 11% RevPAR growth, and our Hyatt Chicago delivered better than 12% RevPAR growth. Additionally, our Renaissance Washington, D.C., which we renovated in 2012, delivered nearly 43% RevPAR growth in the third…

[Operator Instructions] Your first question will come from the line of Lukas Hartwich from Green Street Advisors.

Two of your 3 acquisitions this year have been pretty large hotels. I'm just curious if there's a strategy there, or is that just a coincidence?

I would say that our strategy is generally unchanged, but we look to own institutional-grade hotels. We do strive to acquire hotels that generate at least $5 million of EBITDA. So by definition, those are the larger properties. We will acquire hotels that generate slightly less than that, if they're a part of a market complex where we can leverage our asset management expertise across a variety of hotels like what we did in Chicago or, similarly, in earlier this year, in New Orleans where we acquired a relatively small hotel but it's adjacent to a preexisting investment in the market. So all in all, no, I wouldn't say there's a shift in our strategy toward 800-, 900- or 1,000-room hotels. We like the idea of owning business transient hotels in strong markets on good street corners. Those hotels could be 300 rooms or 400 rooms or, as was the case with 2 of our acquisitions this year, somewhat larger than that.

Great. And then can you just give us an update on your disposition strategy?

Sure. At this point, we've got maybe 2 to 4 hotels within our portfolio that would qualify for a disposition as the cycle matures. Our goal in terms of harvesting gains within our portfolio would be to sell some of the smaller geographically-isolated hotels, especially those hotels that, as we've done in the past, generate RevPAR that's in the double digits instead of the triple digits. At this point, we do not have any hotels on the market, but we will look to sell, again, 2 to 4 hotels over the next call it 1 to 3 years.

Your next question will come from the line of Nikhil Bhalla from FBR.

This is Weston Bloomer asking a question on behalf of Nikhil Bhalla. My question regards to the relatively soft New York City performance in 3Q despite renovations. I was hoping you could go and provide more color as to why that may be? I know 3 of your 4 renovations did specifically well in the first half, while the Hilton Times Square came in a little lower. And then any additional color on the New York City market will be great.

Sure. Thank you. Good question, actually. New York has been a big focus of ours for quite some time. You're right, our hotels performed basically at the market. If you look at the 2 on average, we ended up with a slightly above market performance at the DoubleTree Times Square, which is located right there at 47th and Broadway, and a slightly below market performance at the Hilton. Most of the performance softness that we saw in our New York properties was related to a change in the Hilton Honors' regime, where, basically, Hilton Honors' points were devalued significantly earlier in this year. That change hit our DoubleTree more so than it did the Hilton. But either way, both of those hotels were impacted by a material reduction in HHonors' redemptions, which was part of our strategy. Other than that, we're seeing generally market performance for those 2 hotels as the year progresses, and we would expect that the Hilton will continue to perform well relative to its comp set given its newly renovated status.

Gentlemen, there are no further questions at this time. I will turn the conference back over to Ken for closing remarks.

Excellent. Look, we appreciate everyone's time today, and we look forward to speaking with many of you over the next few days at the NIRI Conference. Thank you.

Ladies and gentlemen, this concludes the conference call for today. Thank you for participating, and please disconnect your lines.