Good day, welcome to the Host Hotels & Resorts Q4 2020 earnings conference call. Today's conference is being recorded. At this time, I would like to turn the call over to Tejal Engman, Senior Vice President of Investor Relations. Thank you. Good morning, everyone. Before we begin, please note that many of the comments made today are considered to be 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're 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, adjusted EBITDAre, cash burn, and hotel level results. You can find this information together with reconciliations to our most directly comparable GAAP information in yesterday's earnings press release, in our 8-K filed with the SEC, and in supplemental financial information on our website at hosthotels.com. Participating in today's call with me will be Jim Risoleo, President and Chief Executive Officer, and Sourav Ghosh, Executive Vice President, Chief Financial Officer, and Treasurer. Now I'd like to turn the call over to Jim. Thank you, Tejal, and thanks everyone for joining us this morning. I'd like to start by expressing my heartfelt condolences to Ernie's family and to all our friends at Marriott. I have known Ernie for 25 years and found him to be one of the most authentic, engaging, and caring leaders in the lodging space. A visionary leader, a loving husband and father, and a respected colleague and friend. Ernie will be deeply missed and is leaving a lasting legacy within our industry and all the lives he has touched. Host has emerged from the most challenging year in lodging history as a stronger company with robust long-term growth prospects. Our hotels have streamlined their operating models and minimized operating expense growth from Q2 lows while accelerating RevPAR from $9 in April to approximately $42 in January. We have cut our hotel level operating loss by more than half, from $163 million in the Q2 to $75 million in the 4th. We have also achieved break even or positive hotel level operating profit at 20 hotels representing 24% of our rooms in the Q4, a sharp increase from 14 hotels and 13% of our rooms in the Q3. We've invested in our long-term growth and enhanced our ability to gain and retain market share by continuing to upgrade several significant hotels and delivering the new AC Hotel Scottsdale North. We've entered 2021 with $2.5 billion Of total available liquidity. Our investment grade balance sheet has been further strengthened by opportunistic asset and land sales at pre-COVID-19 valuations and debt refinancing that has pushed our earliest maturity to late 2023. Last week, we announced a best-in-class second amendment to our credit agreement, which provides us greater flexibility to acquire hotels early in this new lodging cycle. With the highest quality portfolio in the company's history and a balance sheet that allows us to capitalize on external growth opportunities, we are very well positioned to elevate our EBITDA growth profile through the vaccine-driven recovery. My comments today will focus on top line trends, ROI projects, and our latest views on transaction markets and acquisition opportunities. Sourav will detail our hotel's operating expense control and the improvement in an outlook for cash burn and hotel EBITDA. He will also walk through the additional flexibility and optionality created by the second amendment to our credit agreement. Starting with group booking trends, we saw a marked increase in group booking activity for our Marriott-managed hotels in January. Our hotels booked approximately 101,000 group room nights for 2021, a 32% increase over January of 2019, with January typically being a slow month for group booking activity. Our hotels had an impressive lead to booking conversion rate of 22% compared to approximately 16% in January 2019. While there are several types of groups being booked, we are pleased to see bookings for incentive meetings which have returned after a hiatus in 2020. We also saw improved future group booking activity in January, with approximately 73,000 future group room nights booked for beyond 2021, representing a 42% increase to January of 2019. Through this January, we had approximately 1.6 million definite room nights on the books for full year 2021. Approximately 1 million of these occur in the H2 of the year and are fairly evenly split between the Q3 and Q4's, where bookings are largely continuing to hold. Should the groups materialize, our H2 2021 group business will have recovered to almost 50% of H2 2019 levels based on definite group room nights on the books. While group pace is less meaningful today as most meeting planners remain on the sidelines, we are encouraged by our total group revenue pace for the latter half of 2021. Pace in the H2 of 2021 is down only about 25% compared to the same time last year, versus the H1 being 84% lower than last year. This could improve with additional in the year, for the year group booking activity, assuming state and local restrictions are relaxed and attendees become more comfortable with travel. Staying with group, we believe that the location and quality of our hotels, as well as our long-standing sales relationships with key travel managers favorably positions them to gain market share when group demand returns to urban markets. For example, when demand from government agency groups surged around inauguration, our D.C. hotels ran occupancies of 81% and 78% on the day prior and the day of inauguration, respectively, and we temporarily reopened a Hyatt Regency Capitol Hill to capitalize on this demand. For those days, our hotel's occupancies were 13 and 11% points higher than other luxury and upper upscale hotels in the D.C. metro region. Moreover, we achieved an ADR that on average was $26 higher each day for the 3 days of January 19th, 2021. Our hotels significantly outperformed other luxury and upper upscale hotels due to their coveted downtown locations, ability to accommodate large groups, and their 30-year relationships with key government agencies. At the end of the Q3, we had approximately 118,000 definite room nights on the books for the Q4, which would have represented a 7% sequential decline. However, our hotels were able to drive 38,000 in the quarter for the quarter bookings for a total of 156,000 group room nights in the Q4, representing a 23% sequential increase over the Q3. Additionally, Q4 group bookings delivered a 12.3% higher average rate than Q3 2020, helped by this short-term group demand that was driven by small to mid-sized corporate accounts and SMERF groups. Rebookings as a percentage of cancellations continue to increase, with approximately 24% of cancellations at our Marriott-managed properties now rebooked in a funnel of tentative bookings that will take the total rebook to almost 37%. In the Q4 and full year 2020, we collected approximately $11.5 million and $52 million of group attrition and cancellation fees respectively, and expect to collect an additional $12 million to $14 million in full year 2021. Moving on to leisure trends. Leisure demand remains concentrated in Sunbelt markets and key leisure destinations such as Hawaii, as most city and metro destinations remain in various stages of restrictions. With group over the inauguration in D.C., we find that the location and quality of our resorts has enabled them to significantly gain market share. In the Q4, our 16 resorts gained 17.8% RevPAR index share relative to their comp sets. This was driven by 8.1% better occupancy and 9% better rate compared to their RevPAR index scores in the Q4 of 2019. We have gained 30% RevPAR index share in Phoenix, nearly 26% in the Florida Gulf Coast, 14.4% in Miami, and nearly 12% in Maui, Oahu, as our hotels outperformed their peers in capturing leisure demand. Our most recent acquisition, the 1 Hotel South Beach, continues to be an outstanding performer despite the pandemic. The hotel achieved 90% occupancy at a nearly $2,000 rate on New Year's Eve, and has just finished President's Day weekend with occupancy averaging nearly 90% from Friday through Sunday, with a blended ADR of approximately $1,430, which represents a nearly 4% year-over-year increase. Encouragingly, leisure RevPAR performance continues to improve over holiday weekends. For example, at our Marriott-managed hotels, RevPAR improved by 60% 3 weeks out from President's Day compared to where those hotels were 3 weeks away from Columbus Day. In addition, we have observed a lengthening of the booking window in the Florida Gulf Coast, Miami, and in Hawaii, where travelers are getting more comfortable with the testing requirements and process. With upcoming leisure holidays over spring break and Easter, we expect leisure occupancy to continue to improve, driven by our Sunbelt markets and Hawaii. For the H2 of the year, transient revenues at our 3 Maui hotels are pacing 11% higher compared to 2019, while total revenues are pacing almost 20% higher. In the Q4, we grew leisure room nights by 62,000 or by 13.6% over the Q3. Our Sunbelt markets ran 31.6% occupancy in the 1st week of the quarter and progressed to 33.5% throughout the quarter, with growth driven by Miami, the Florida Gulf Coast, Phoenix and San Antonio. Moreover, our loyalty redemption in the Q4 was 25% higher than the Q3 and represented the highest rewards demand since the start of the pandemic. Resort properties accounted for 65% of the growth in loyalty redemption room nights, driven by Phoenix, the Florida Gulf Coast, Hawaii and Orlando. Moving on to business transient. Demand remains low, but has improved by 13% sequentially in the Q4, which was the strongest quarter since the pandemic impacted travels. Cities that drove most of the increase over the Q3 were San Antonio, Houston and Philadelphia. As with groups, business transient demand continues to be driven by smaller organizations rather than by large corporate accounts. This decision to remain on the sidelines is partly due to liability risk that we expect will fade as vaccine deployment accelerates. Shifting to portfolio reinvestments, let me begin by saying that our ability to continue to invest in our portfolio is a competitive advantage that we expect will favorably position Host to gain market share and deliver superior revenue and EBIT growth through this lodging recovery. 3 to 5 points of weighted index growth at our renovated hotels in 2019 would have translated into roughly $38 million to $63 million of incremental revenues and $21 million to $34 million of incremental EBITDA on a stabilized, analyzed basis. In addition to this, we expect our ROI projects to materially enhance the underlying value of our real estate. Last year, we completed extensive resort renovations and repositionings at the Hyatt Regency Maui Resort and Spa and The Don CeSar in St. Pete Beach. Within the Marriott Transformational Capital Program, we plan on completing The Ritz-Carlton, Amelia Island in March this year, following several notable completions, such as the JW Marriott Atlanta Buckhead, among others in 2020, and the San Francisco Marriott Marquis, Santa Clara Marriott, New York Marriott Downtown, and Coronado Island Marriott Resort & Spa in 2019. We continue to invest in the Marriott Transformational Capital Program, as well as in other ROI projects, which on a combined basis represent nearly 71% of our 2021 capital spend. Moreover, nearly 85% of our investment in the Marriott program is expected to be complete by year-end 2021, and the entire program should be substantially completed by year-end 2022. Having completed 7 of the Marriott program renovations through year-end 2020, we expect to complete an additional 4 hotels in 2021, thereby transforming 11 of the 16 hotels that make up the program. We expect to benefit from $16 million of operating profit guarantees from Marriott in 2021 without experiencing commensurate revenue disruption given the current low RevPAR environment. In addition, we expect to deliver 19 new 2-bedroom luxury villas at the Andaz Maui at Wailea Resort in April this year. The 11 existing villas achieved a RevPAR of approximately $1,700 in 2019. While they exhibit strong demand throughout the year in normal years, recent demand for villas has more than tripled from pre-pandemic levels. ADRs for these villas ran at almost $3,700 a night in December and at $2,400 a night in January. We already have 300 room nights on the books for the new villas with a transient rate of $1,990 a night. The hotel has only just begun marketing them. Although the villa expansion wasn't part of our original underwriting when we acquired the hotel in 2018, we are currently exceeding our project underwriting assumptions for 2021 on both rate and occupancy. We are excited to announce the repositioning and expansion at one of our top performing hotels, The Ritz-Carlton, Naples, where we see an opportunity to create meaningful value while also transforming the resort to meet today's luxury standards. A new tower and reconfiguration within the existing hotel will increase the suite count at The Ritz from less than 8% of total inventory to almost 20%, or 92 keys, while adding 24 keys overall. In 2019, the resort's 35 suites achieved RevPAR of approximately $800, almost double the overall RevPAR of the resort, and are highly sought after by the hotel's loyal customer base. Additionally, an expanded club lounge will eliminate the size constraints on upsells, which generated an annualized ADR premium in excess of $220 in 2019. Business interruption estimates continue to be low due to the impact of COVID-19 on occupancy, which also makes this an opportune time to renovate the guest rooms and to make ROI-generating upgrades to the resort's pools, pool bar, and restaurant. The project will commence in May 2021 and is expected to be complete in December 2022. At stabilization in 2023, we expect this project to generate nearly $10.5 million of incremental annualized EBITDA, which represents a 12% cash-on-cash return on incremental investment based on our underwriting. On acquisitions, in the 1st weeks of 2021, we have seen a marked increase in the number of attractive hotels coming to market. From looking at just a handful of deals in the Q4 of 2020, we now have a solid pipeline of interesting and actionable opportunities to evaluate. In many instances, the hotels we are looking at are owned by private owners who have been contemplating liquidity events for some time. While we expect to face strong competition for acquisitions, we are very well-positioned due to our deep relationships and our ability to move quickly from large equity investments with cash and provide tax-advantaged alternatives to sellers. This management team has a strong capital allocation track record, having acquired $1.6 billion of assets and sold $3.3 billion of assets at favorable multiples in 2018 and 2019. The biggest shift in our acquisition strategy is our consideration of markets beyond the top 25. IBM Watson, our recently developed predictive analytics model, mines over 1 million discrete structured variables and leverages natural language processing insights from over 3 million unstructured data sources to forecast RevPAR growth by market. We use this proprietary top-line predictive model in our research-based expectations for hotel operating expense growth by market to narrow down the markets that are likely to outperform the revenue and EBITDA growth pro-profile of our existing footprint. While we believe this is an opportune time to deploy capital as we are at the beginning of a lodging cycle and appear to be heading into a period of strong economic recovery, let me emphasize that we are not looking to acquire for acquisition's sake. We are optimistic about finding opportunities that will truly elevate the EBITDA growth profile of our existing portfolio. To conclude, we are very encouraged that vaccine deployment in the U.S. has gained momentum with over 55 million doses administered already and 1.7 million new doses being administered each day, according to CDC data. As The Washington Post recently reported, the United States has purchased enough supplies to vaccinate all American adults, making the vaccine-driven recovery more certain today than it has been since the pandemic began. McKinsey estimates that the US may achieve herd immunity by the Q3 Q4, and that a transition to normalcy is possible as early as the Q2 of 2021, aided by the spring weather and the vaccination of the highest risk population. Should this scenario materialize, we expect to be able to achieve positive hotel EBITDA at some point in the H2 of the year and to continue to benefit from a rebound in travel as the pandemic recedes. With that, I will turn the call over to Sourav. Thank you, Jim. Good morning, everyone. Following the revenue-related green shoots Jim detailed on group bookings and transient demand, I would like to give you a better sense of how we expect property-level expenses to trend relative to revenue this year. Since the start of the pandemic, we have worked closely with our property managers to aggressively limit costs and evolve the operating model to adjust for the business environment. In the Q4, excluding severance, property-level expenses were approximately 65% lower compared to the Q4 of 2019. Including wage and benefit costs, variable expenses were roughly 82% lower year-over-year, broadly in line with RevPAR declines of 79.7%, while fixed expenses were approximately 47% lower. Variable expense reduction has consistently been in line with overall revenue declines through the downturn. Fixed expenses that are somewhat associated with business volumes, such as maintenance, marketing, and utility costs, saw a dramatic reduction in the Q2 and have slowly increased as business improved through the back half of the year. Brand programs or services, such as above property sales offices and IT, have seen material reductions as our operators have restructured their shared services organization. Finally, costs below the growth operating profit line, which include taxes and insurance and are traditionally completely fixed, saw modest reductions in the Q4 due to one-time credits such as operating profit guarantees associated with the Marriott Transformational Capital Program. As a result of our property and brand management team's efforts to ensure that cost growth remains in line with slowly improving revenues, our quarterly expense reduction ratio, which measures the year-over-year decline in property level expenses divided by the year-over-year decline in total revenues, was fairly stable at approximately 0.8 in the Q2, Q3, and Q4. This means that for every 1% decline in year-over-year total revenue, our hotels reduced year-over-year expenses by 0.8%. The question now is: What does this ratio look like as revenues return in 2021? We have always expected to reach a plateau where the ratio deteriorates as services and standards return to the middle of the revenue recovery. Although we still expect this to be the case, because 2021 is a transition year, our hotels are striving to achieve an expense reduction ratio of between 0.65 and 0.7 throughout the year, as measured by property level expense and total revenue declines relative to 2019. Moving on to hotel level operating losses. We improved our quarter-over-quarter results by 23%, mainly by increasing revenues while keeping hotel expenses relatively stable. Most of the increase in expenses was associated with the 5 hotels that we reopened in the Q4, as well as greater business volumes overall. Our hotel level operating loss averaged $25 million per month in the Q4, down from approximately $32 million in the Q3, including the $15 million and $23 million of employee retention credit our managers received in 2020 under the CARES Act and passed on to us in the Q4 and Q3, respectively. Excluding these one-time credits, our monthly hotel level operating losses in the Q4 averaged approximately $30 million and were better than the $40 million of hotel level operating losses we outlined on our Q3 call, primarily due to revenues being approximately 35% higher on a sequential basis in the Q4. We expect Q1 hotel operations to be broadly commensurate with the Q4 of 2020 as further improvement in fundamentals may be offset by leisure demand being seasonally weaker in the Q1 than the Q4, which benefited from strong ADRs and occupancies in the days leading up to and including New Year's Eve. We therefore expect an average hotel level operating loss of approximately $30 million to $35 million a month, not including any one-time credits our hotels may receive in the Q1. Adjusting for interest payments and corporate G&A, we expect monthly cash burn from operations to range between approximately $49 million to $54 million. With regards to our outlook, it remains challenging to forecast precisely when we will achieve hotel level EBITDA breakeven and profitability in the H2 of 2021, as much depends on the success of vaccine administration and the continued easing of state and local restrictions. Following the Q1, we expect a gradual sequential improvement in RevPAR. We anticipate this to be occupancy driven in the Q2 and Q3, when ADR may sequentially decline as suspended luxury and upper upscale hotels reopen. Our research indicates that operations at approximately 13.5% of luxury and upper upscale hotels in our top 25 markets are currently suspended and likely to reopen at low occupancies during the Q2 and Q3 of this year. Turning to the 20 hotels that have achieved breakeven or positive hotel EBITDA in the Q4, breakeven generally has been achieved in the 35% to 45% occupancy range, with ADRs down in the approximately 15%-30% range compared to 2019, which is in line with the estimates we 1st provided in April. Assuming the inclusion of corporate level expenses for interest and corporate G&A, we would break even at occupancy levels of approximately 45% and 60% at the same ADR decline levels of 15%-30%. Moving on to the balance sheet. The second amendment to our credit agreement has increased our acquisition capacity to $2 billion using existing liquidity with a minimum liquidity requirement of $600 million. The capacity may include $500 million of proceeds from asset sales that would otherwise have been required to repay debt as long as we use the proceeds to acquire assets that are unencumbered by debt. In addition, we have retained our ability to redeploy $750 million of asset sale proceeds into acquisition via the 1031 exchange process while extending our leverage covenant relief period to the Q2 of 2022 and our leverage covenant easing period to the Q3 of 2023. In doing so, we have created cushion for our internal recovery as well as capacity to accommodate external growth opportunities. There are a couple of additional items I would like to bring to your attention. First, We recorded an income tax benefit of $220 million in 2020 due to the net operating loss incurred by our TRS. As a result of legislation enacted by the CARES Act, this net operating loss may be carried back up to 5 years in order to procure a refund of previously paid federal corporate income taxes. We anticipate that our TRS will incur a net operating loss in 2021, and that we will continue to report a corresponding tax benefit in the Q1 of 2021. 2nd, we have included schedules with historical pro forma hotel metrics in our Q4 2020 supplemental. The metrics include quarterly RevPAR, occupancy, ADR, revenue, EBITDA, and adjusted EBITDARE going back 8 quarters to the Q1 of 2019, and we plan on updating this schedule quarterly. To conclude, our focus and 3 strategic objectives continue to be to redefine the operating model, gain market share, and strategically allocate capital. Over time, we expect to recover to 2019 levels of RevPAR with costs that may be $100 million to $150 million lower than they were in 2019 on a nominal basis with a portfolio that's gaining market share and outperforming its comp set. With that, we will be happy to take any questions. To ensure we have time to address questions from as many of you as possible, please limit yourself to 1 question. I decide we'll be conducting a question-and-answer session. If you would like to ask a question, please press * 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press * 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the * keys. One moment please while we poll for questions. Our 1st question is from Smedes Rose with Citi. Please proceed with your question. Hi, good morning. Jim, I wanted to follow up on your commentary around a pipeline of, I think you called them interesting and actionable properties. That sounds like a quite a bit of a change from your last call. I was just kind of wondering if you could talk about what's causing more opportunities to come to light for you, and maybe you could just kind of touch on how you're thinking about underwriting those properties as you move forward. Sure, Smedes. Happy to address your question. I think what has changed is the simple fact that a lot of owners of hotels who were holding off bringing their properties to market have now started, as we have messaged today, to see light at the end of the tunnel here. You know, I think that you can tell from our commentary and from our release that we feel confident that assuming the vaccine continues to be rolled out and, you know, there isn't any disruption due to new variants being found, which it doesn't appear to be today anyway. It's the beginning of a new cycle. There are a lot of buyers who have sat on the sidelines to wait for the time when there might be more buyer interest, and we're starting to see that now. It, the pipeline has truly meaningfully expanded between the Q4 and the early part of this, of this year. You know, when I say they're actionable opportunities, these, in many instances, are private owners who have wanted to monetize their investment for 1 reason or another. Modestly along the lines of distress. There's not that much distress out there. We are seeing, you know, owners who say, "This is the time," and this is the time to take these assets to market. I don't think that there is a lot of just, you know, price analysis occurring, based on the conversations we're having. These are people who really wanna sell their hotels. You know, we are in a really unique position, given the fact that we have $2.5 billion of cash, and we have the ability to acquire up to $2 billion of assets out of existing liquidity, subject to maintaining $600 million of liquidity inside the company. That gives us the ability to go out and buy hotels on an all-cash basis, without the need to obtain debt financing, which is a distinguishing factor for us. We have, you know, very strong, deep relationships having been in this industry for over 30 years, and a very solid reputation. The ability to move quickly, and to get deals done. The other thing I think that is bringing people to market today is the fact that the debt markets are opening up. You know, we expect that there's gonna be competition from private equity firms, there's no question about it. You know, we're happy to have that competition. I think that, the print for the Q4 on what we've been able to accomplish on margins, in a very challenging environment, gives us a high degree of confidence that between our Enterprise Analytics Group and our asset managers, that we can find ways to create value, even in the environment that we're in today. We're confident. I don't know how many deals we're gonna get done, but we do believe that we're at the beginning of the cycle. you know, we came into 2020, in the best shape that the company's ever been in, because, in large part, we believed going into 2019 that we were heading into the end of the lodging cycle. We were prudent in our capital allocation strategy, and I think it's gonna pay off for us because it's giving us the opportunity to acquire hotels, as the economy reopens and as the lodging cycle begins anew. Great. Appreciate the detail. Thank you. Sure. Our next question is from Robin Farley with UBS. Please proceed with your question. Great. Thank you. Jim, I was interested in your comment about looking outside of the top 25 markets now when you think about acquisition. You know, would that still be urban, or are you thinking more resort? As kind of part of the same question, I'm just wondering, you know, when you talk about IBM Watson, is there some risk with That the data points that are, you know, that AI would think these data points are gonna continue, that are really driven by temporary dynamics and that, you know, that we know will be temporary and the things that will change, but it wouldn't necessarily be obvious to a machine predicting based on data points from the last 2 years? I guess just thinking about that with the markets you're looking at. Thanks. All right. Let me, let me start by addressing IBM Watson, Robin. It's a powerful tool for us. It does give us an opportunity to evaluate markets through predictive analytics, as I mentioned. I will say that it's 1 tool that we use. You know, we would never substitute IBM Watson for our judgment on what we see happening in markets. You know, so it takes into account a lot of data. I mean, we have always looked at structured data, and we continue to do that. IBM Watson looks at unstructured data and, yes, the world has changed, but I think that the unstructured data is out there and we're very fortunate to have a tool like IBM Watson to capture that data. Additionally, you know, as we think about markets, we are looking at markets where we believe that, we can acquire hotels that will allow us to grow EBITDA at a higher level than our existing portfolio of assets. In addition to looking at top line, we will be studying in detail, the expense profile of each hotel because it's critical that, yes, you have strong revenue management, and you have the ability to sell your property, but it doesn't do you a lot of good if you don't have the flow through. Controlling expenses is absolutely critical to how we, look at properties going forward. I will tell you that one of the reasons we're looking at markets outside the top 25 today is because we think that expense growth, at least for the near term, is likely to be higher in major urban markets as we come out of this, just given cost pressures that the urban markets are facing today. You know, further to answer your question, resorts, you know, I think our resort story is incredible. If you look at the statistics, the RevPAR index shares we've been able to achieve on the 16 resort properties we have, and if you look at specific resort markets like Miami, the Gulf Coast of Florida and Venice, we couldn't be more pleased with how our resorts have performed. Yes, they'll be at the top of the list. I would tell you more importantly it's going to be assets where there are multiple demand drivers. We are gonna continue to look for properties where there's a mix of business transient, leisure transient and group. We are strong believers in having diversity of demand in giving us the ability to pivot from 1 type of demand to the other depending on market conditions. Okay, great. Thank you very much. Our next question is from Neil Malkin with Capital One Securities. Please proceed with your question. Hey, good morning, everyone. Jim, I think it's a good idea to generally avoid the markets where you have that- Ridiculous union pressure, you know, making it unprofitable to operate. My question for you is on Hawaii. It's a big part of your portfolio. Maybe I think it's your either 1 or 2 largest market. I think that was actually one of the saving graces, or at least, you know, relative to our expectations, you know, ADR was very high, you know, even though occupancy was around sort of maybe portfolio average. Can you just give an update on sort of how you see Hawaii playing out in terms of demands, sort of pent-up demand, and then like maybe what the Asian travel, you know, kind of story or timeline looks like to that market as well? Sure, Neil. You know, we are. Our EBITDA in Hawaii is concentrated in 3 terrific hotels located on Maui. The visitation to Maui is driven by domestic U.S. travel. It's really not driven by Asian travel. Asian travel is heads to Oahu and the Big Island of Hawaii predominantly not on Maui. You know, the ability that we have had on Maui to hold rate and to see rate pacing total revenue pace up 11% in the back half of 2021, I think speaks loudly to the desirability of Maui and our resorts in particular. You know, we actually figured out how to navigate the testing requirements and the other requirements the State of Hawaii had put in place and took a family vacation to Maui over Christmas. You know, even though occupancies were very low, ADRs were very high. I think that we are going to continue to see Maui and Hawaii travel increase particularly as the vaccine gets rolled out. What's apparent to us is that there is incredible pent-up demand out there particularly on the leisure side. The amount of money that has been saved as a result of the various restrictions and lockdowns, and the fact that people aren't going to the office, and they're not commuting, they're not going out to lunch, people aren't going out to dinner, is pretty incredible. We will continue to see Hawaii grow over time. You know, the other data point that is just very, very encouraging is what we're seeing with respect to villa bookings at the Andaz. You know, the fact that we had a $3,700 ADR during the month of December for the villas and how we're getting incredible demand on our 19 new villas that aren't even complete. We're bullish on Hawaii and, you know, we think that leisure is going to really continue to carry the day as we see business transient and group evolve. Thank you. Our next question is from Michael Bellisario with Baird. Please proceed with your question. Good morning, everyone. Jim, you gave a lot of info-. Good morning. Just a question for you on the leisure side, you gave a lot of detail specifically on leisure heavy markets and them doing so well. Maybe can you look at the other side of the coin? What's the update? What are you seeing in your coastal urban markets, both from a group and transient perspective? And then you mentioned the sequential BT uptick. Is that occurring in any of these more impacted gateway markets? You know, I'll take part of this. I'm gonna ask Sourav to also provide some commentary on it as well. Not surprisingly, you know, the urban markets are still in very various stages of restrictions. You know, as an example, in California, you still have certainly in Los Angeles County, I don't know about San Francisco, but in L.A. County, indoor dining is still closed. You have the ability to eat outside at a restaurant. Gyms are closed. You know, other amenities like hair salons, nail salons are open, but with 25% capacity. New York as an example, you know, Broadway's closed. You know, they've opened up indoor dining. You know, until we see services return to normal and, you know, we're hearing that Broadway could open up soon. Until we see services return to normal, I don't think you're gonna see a lot of demand in the coastal markets. Sourav, you wanna touch a little bit on BT trends? Sure. On the BT front, Not as much demand as you would expect right now in the coastal urban markets. We are seeing some demand as it relates to our consultants, so the Deloitte, PwC of the world, as well as some project teams, that are certainly going to these markets as well. Obviously, some, you know, government and government contract business as well. You know, at the end of the day, when you think about it, the offices really need to open up, and the companies need to get comfortable with their folks traveling on business. When that does happen, that's when BT travel will really come back in a meaningful way. As Jim mentioned, given the cadence of the recovery that we are seeing with the vaccine, you know, administration across the U.S., that bodes us really well, and we are optimistic that recovery is gonna occur sooner rather than later. I would mention just 1 thing on the group front is we did do future bookings of about 73,000 room nights from 2022 and beyond. The encouraging sign there is 30% of that 73,000 room nights was made up of Boston, New York, and Seattle. Those are, again, obviously urban markets, and that's an encouraging sign for the future. Thank you. Well, Mike, the other thing I would add here, this will impact the urban markets. You know, we've had conversations with our managers, obviously around a lot of matters. You know, in particular, when we're talking about BT, we are of the opinion that we might see 50%-60% of corporate travel returning by Q4 this year. That's an encouraging sign for us. The other encouraging sign is that most special corporate accounts have held rates flat in 2021 versus 2020. If you recall, 2020 was flat to 2019. That's a very encouraging sign that corporate accounts aren't pushing back on rate when they're negotiating. You know, there are a lot of green shoots out there, and again, you know, not to keep talking about the vaccine, but it's all dependent on the country getting vaccinated and us achieving herd immunity and offices opening up and people getting back on the road. Perfect. Thanks for the follow-up. Our next question is from Shaun Kelley with Bank of America. Please proceed with your question. Hi, good morning, everyone. I wanted to dig in for a moment on 1 of Sourav's comments, just talking about the flow-through kind of coming out of this crisis. Sourav, appreciate you kind of trying to put that in, into terms that, I think we'll understand as analysts. I just wanna sort of reframe it a little bit. I think what you said was you could expect for this year something like, you know, for $0.65 to $0.70 on the dollar of like, let's call it revenue flowing through to the bottom line. 1 is just to clarify, am I, am I thinking about that correctly? 2, if I am, if we go back and look, you know, I believe the flow-through rates, let's go back to like 2009, 2010, at least as an industry, they were decently lower than that. I believe what happened was, you know, occupancy hadn't fully recovered yet. So it took a little longer to hit, you know, those really high flow-throughs because first you're filling up, you know, there's more variable expense attached to that. It's really the rate portion of the equation that drives the higher flow-throughs. But, you know, is that equation gonna be a little different this go around, and/or could you see higher flow-through as rate actually starts to come back as well? just maybe help us break that down a little bit. Sure thing. Let me just give an example, so it puts the numbers into perspective. If you just take the Smith Travel Research numbers for 2021, they're estimating RevPAR down 56%. What we are saying with this expense ratio, and let's take the midpoint of what we are saying between the 0.65 and the 0.7, that's 0.675. If you take that 0.675 and multiply that by the 56%, all we are saying is that expenses would reduce by 37.8%. That's what we are saying is, you know, to the midpoint in 2021. We have not seen this in the last downturn where we went, had a ratio of as high as 0.8. It got as high as 0.69 back in 2009 relative to the peak. That with every subsequent year, obviously that ratio starts going down as expenses start coming back. This time around, definitely more incremental expenses are being taken out. You would expect better flow through, to your point, as ADR starts coming back in a meaningful way. The quicker the revenues come back, the better the flow through will be because you would also be you know, having the benefit of expenses not growing at inflation over multiple years. The sooner revenues come back, the better flow through is gonna be, the quicker you would have margin expansion. Hope that makes sense. It does. Thank you very much. Our next question is from Lukas Hartwich with Green Street. Please proceed with your question. Thanks. Good morning. Good morning, Lukas. Hey, Jim. Along the lines of the AC Hotel development and the, and The Phoenician land sale, I'm just curious if there are more opportunities in the portfolio to unlock hidden value that maybe aren't apparent to, you know, us in terms of the disclosure that we get? Sure. there are Lukas, and, you know, we are very thoughtful about having conversations with respect to value enhancement opportunities until our projects are permitted and are designed and are underwritten. That is 1 of the reasons why we were really happy to share with you today in my comments, what we're doing at our The Ritz-Carlton, Naples. The ability to truly create, you know, what we believe based on our underwriting, is a 12% cash-on-cash return on that value enhancement opportunity, in addition to really truly increasing the underlying value of that hotel, through the repositioning of it, the addition of suites and, you know, the refresh of the guest rooms and the bathrooms, in a luxury resort is very attractive to us. We are working on a number of additional opportunities to either add rooms at properties where we think it makes sense, to take excess parcel of land where it makes sense and develop a select service hotel on it. The short answer is you'll be hearing a lot more from us over the course of time as we move through the entitlement process and as we complete our design, costing, and underwriting. We have a whole team in design and construction who is on this. You know, we're in a unique position as a company because we have an integrated workforce with design and construction, asset management, enterprise analytics, investments, and the like within the company to do this sort of work. We're excited about it. It's a key focus for us. You know, we think that many times it's you're in a better place to invest in your own assets than you are to make acquisitions. That's not saying that now is not the time to make acquisitions. It is. We're gonna continue to invest in our properties as well. Makes sense. Thank you. Our next question is from Anthony Powell with Barclays. Please proceed with your question. Hi. Hello, everyone. Just a question on, I guess, competition for transactions? It seems like the resort and Sun Belt opportunity seems to be very popular right now. Do you see more competition for those hotels versus maybe recovery plays in urban markets? How do you think cap rates are gonna trend between kinda Sun Belt resort, urban group and urban, I guess, business transit hotels? How do you view cap rates going in as part of your underwriting as you look to buy hotels this cycle? Anthony, I think that, you know, it's cap rates are 1 metric of the underwriting. Obviously, you know, by and large, there aren't many hotels out there today that I would deem to be stabilized operating models as we're looking at them. We obviously look back at 2019, and get a sense of how the asset would have traded at that point in time, what the cap rate might have been back then, and apply that to the pricing expectations that a seller has. And, you know, it's just, it is, it's all over the board today. You know, we're seeing certain assets that are gonna trade at a discount to pre-COVID pricing. We're seeing assets that are gonna trade at pre-COVID pricing. Cap rate is 1 metric that we're looking at, but we're also looking at how quickly we think we can stabilize the asset, what the EBITDA growth will be, what that EBITDA multiple is going to look like, what the discount to replacement cost is, you know, supply/demand factors in any given market. It's just a number of different things today. I mean, there's not 1 way that you're gonna underwrite a hotel in this environment. I would tell you that it's, you know, if you think about a bar of soap, it's multiple legs on the stool. You know, it's cap rate is 1, EBITDA multiple is another, replacement cost is yet another and, you know, demand trends in any given market. There is not 1 way to do it. We're taking into account a lot of different things in our underwriting model. Got it. What about competition? Do you think it will be easier to maybe buy urban hotels this time around than the resort properties that are popular right now? I think it's too soon to say that. you know, clearly the urban markets are gonna recover. you know, it's just a question of when the restrictions are lifted, when people get back to work, you know, when international travel starts coming back into the U.S. I would not write off the urban markets, but, you know, they're gonna recover a little slower than the resorts, and in certain other markets, just given the dynamic that I've referred to. Right. Thank you. We have reached the end of the question and answer session, and I'll now turn the call over to CEO, Jim Risoleo, for closing remarks. Thank you all for joining us on the call today. We really appreciate the opportunity to discuss our Q4 results with you, and we look forward to talking with you over the coming weeks and months, hopefully in person. Please stay healthy and positive, and have a great day. This concludes today's conference, and you may disconnect your lines at this time. Thank you for your participation.