Greetings, and welcome to the Pebblebrook Hotel Trust first quarter earnings conference call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Ray Martz, Co-President and Chief Financial Officer. Thank you, sir. You may begin. Thank you, Christine. Good morning, everyone. Welcome to our first quarter 2025 earnings call. Joining me today is Jon Bortz, our Chairman and Chief Executive Officer, and Tom Fisher, our Co-President and Chief Investment Officer. Before we begin, I'd like to remind everyone that today's comments are effective only for today, May 2, 2025. Our comments may include forward-looking statements which are subject to risk and certainties. Please refer to our SEC filings for a thorough discussion of these risk factors and visit our website for detailed reconciliations of any non-GAAP financial measures discussed during the call. Now, let's dive into our first quarter financial results. We're pleased to report that our first quarter 2025 performance exceeded expectations despite growing economic uncertainty and a more challenging operating environment. Strong occupancy gains and elevated ancillary revenue at our resorts, combined with continued ramp-up and market share gains at our recently redeveloped properties, highlighted our performance. Hotels in our previously slower-to-recover markets also helped drive performance in Q1. The outperformance was driven by a much better-than-expected success achieving hotel operating efficiencies and cost reductions. Thanks to the outstanding efforts of our hotel teams and our asset managers, we held expense growth well below our outlook and delivered significant improvements in portfolio-wide operating efficiencies. As a result, we exceeded the high end of our outlook for same-property hotel EBITDA, adjusted EBITDA, and adjusted FFO, even with same-property hotel RevPAR at the low end of our outlook range and same-property total revenues at the midpoint. Same-property hotel EBITDA totaled $62.3 million for the quarter, surpassing the midpoint of our outlook by $4.3 million. Same-property hotel EBITDA was negatively affected by an estimated $6.7 million EBITDA headwind from the Los Angeles wildfires and the renovation and brand conversion at Hyatt Centric Delfina Santa Monica. The impact of the fires in Q1 was slightly less than we had forecasted. Our LA teams did a great job reducing operating expenses in response to lower occupancies and revenues from the fires. Adjusted EBITDA came in at $56.6 million, $4.1 million above our outlook midpoint, and adjusted FFO was $0.16 per share, $0.05 above our midpoint, reflecting strong operating execution across the portfolio. Turning to the performance of our hotels, same-property total RevPAR rose 2.1% year-over-year, led by an impressive 8.2% increase at our resorts, where occupancy climbed 4.2 percentage points. Urban total REPAR declined 2.2%, hampered by the disruption caused by the LA fires and the Hyatt Centric conversion and renovation. To provide a more accurate reflection of the underlying strength of our portfolio in the first quarter, if we look at the portfolio excluding Los Angeles, same-property total RevPAR increased 6%, same-property RevPAR grew by 4.9%, and urban total RevPAR rose by 3.9%. In March, we began to experience an uptick in travel cancellations and softening demand from government and government-related segments, as well as from Canadian and other international inbound travel. Overall, March turned out softer than we expected just a month ago. Looking at individual markets, Washington, D.C., delivered a healthy performance, posting a 14.7% RevPAR increase, benefiting from the inauguration-related activities in January. San Francisco also performed exceptionally well, with a RevPAR up 13%, thanks to strong business group and transient travel, with further recovery in leisure travel and an improved convention calendar. The nearly 10 percentage point jump in occupancy in San Francisco is especially encouraging, considering the Q1 convention calendar was only slightly ahead of last year. With the convention calendar up nearly 70% for the full year, it reports for a strong lift in demand throughout the year, especially in the fourth quarter. This positive momentum in San Francisco is also being supported by the new mayor's aggressive focus on crime reduction, increasing safety and cleanliness, activating the city, more effectively treating homelessness and mental health, and implementing business-friendly policies. We're also extremely pleased with the new leadership at SF Travel, which has already been successful in driving stronger convention calendars for 2026 and 2027. Portland achieved solid results as well, with RevPAR rising 7.5%, fueled by an 8 percentage point gain in occupancy as the market continues to recover. Chicago delivered another strong showing in its recovery, with RevPAR growth of 7.1%, and Key West rose 4.7%, driven by both rate and occupancy gains, a positive sign amid broader concerns around consumer spending and softening international travel demand, particularly from Canadian travelers. Looking at our monthly trends, January RevPAR started strong, up 4.2%, benefiting from the inauguration in D.C. February saw a modest growth at 1%, while March declined 3.7%, primarily due to the L.A. fires and a pullback in government-related travel impacting markets around the country. To give a clearer view of the underlying trends across our portfolio, excluding Los Angeles, same-property RevPAR climbed 9.9% in January, 7.5% in February, and declined 0.6% in March. While March was softer than we expected, we saw encouraging signs of demand stabilizing in April, which Jon will cover in more detail. Same-property total revenues increased 1% for the quarter, driven by a robust 7.1% increase at our resorts. Excluding Los Angeles, same-property total revenues rose a strong 4.8%, powered by the positive impact of our extensive portfolio redevelopment program, which included comprehensive property renovations, upgraded amenities, and additional and revitalized event spaces and food and beverage outlets. The top contributors this quarter included our California resorts, La Playa, Naples, and our Key West resorts, all encouraging signs of continued resilience from both business group and leisure travelers, which we are effectively monitoring for any emerging signs of changes in demand. Urban total revenues declined 3.3%, but excluding Los Angeles, urban revenue posted a solid 2.8% increase. Out-of-room revenues also remained healthy, rising 4.6% overall, driven by a strong 4.8% gain in food and beverage. Excluding Los Angeles, same-property non-room revenues climbed an impressive 6.6%, with food and beverage up 6.5%, reflecting increased spending from both business and leisure travelers, along with continued growth in group-related demand. Speaking of group demand, it remained solid throughout the quarter. Group room rates rose 5.4% year-over-year, contributing 28.2% of room revenue, a 190 basis point increase over last year. This growth underscores the resilience of business group demand, the positive returns of our significant property investment programs, as well as our focus on growing group throughout the portfolio, especially at our resorts. Jon will share more details and group trends in his remarks. On the cost side, our relentless focus on creating operational efficiencies, combined with our disciplined approach to controlling costs, paid off again this quarter. Same-property hotel expenses rose only 3.7% year-over-year, significantly below the low end of our expense growth outlook, despite revenue growth at the midpoint of our outlook and despite the front-end-loaded wage and benefit increases we saw and discussed in our last call. Turning to La Playa and Naples, resorts delivered a standout quarter, continuing its strong recovery following Hurricanes Helene and Milton. Total RevPAR surged 22%, while total hotel EBITDA climbed nearly 30% year-over-year, surpassing 2019's levels by more than 26%. We recorded $4.3 million in business interruption income for the quarter, exceeding our outlook by $300,000. We now expect to receive an additional $4.2 million throughout the rest of the year, raising our total BI forecast by $2.5 million to $8.5 million for 2025, as compared to the $6 million we were previously forecasting. As a reminder, BI income is not included in our same-property reporting results, but it is included in adjusted EBITDA and FFO. Thanks to the comprehensive rebuilding efforts post-hurricane-in, LaP laya demonstrated significant resilience following Hurricanes Helene and Milton, with damage more limited, a faster restoration timeline, and a more rapid bounce back in operations. Additional physical improvements planned for later this year will further enhance the resort's long-term durability and reduce the impact of future storms. La Playa remains truly beloved by both guests and the local community, and its outstanding recovery is a testament to the strength, dedication, and perseverance of our hotel operating team, for which we are deeply grateful and thankful. During the quarter, we also invested $16.7 million in capital projects, including the substantial completion of the $15 million renovation of Hyatt Centric Delfina Santa Monica. Our full-year capital plan remains unchanged, with expected investments between $65 million and $75 million. Our balance sheet remains strong, with $218 million in cash and more than $640 million of available capacity on our unsecured revolver. For context, that's about $325 million more in liquidity than we had at year-end 2019. In addition, nearly all of our debt is unsecured, with only two property-level loans, and we have no significant maturities until December 2026, giving us significant flexibility in an uncertain environment. We also continue to generate and retain significant free cash flow. With that, I'd like to turn the call over to Jon for a deeper dive into our hotel operations, industry trends, and our expectations for the rest of the year. Jon? Thanks, Ray. As Ray indicated, the underlying performance in our portfolio was strong in January and February, but it softened in March. In January and February, it seemed clear to us that overall industry demand had realigned with GDP and overall economic growth, a trend that began in October last year. In addition, business transit and travel continued to recover as more companies pushed employees back to the office. Leisure demand in our portfolio was healthy during the quarter, showing growth in weekend demand at our resorts and at our urban properties, and group remained resilient throughout our portfolio. The softening in demand we saw in March appeared to be highly correlated to the DOGE activities driving federal government layoffs, a spending freeze, and elimination of non-essential government travel, along with a negative reaction by Canadians. We experienced some government group and government-related conference cancellations, with most of it occurring outside of D.C. We also saw a very significant slowdown in government transit bookings nationwide. We estimate that government and government-related group and transit travel make up about 3-5% of total demand in our portfolio and throughout the industry. While the overall impact is marginal, it still likely created a 1-2% drag on demand. It was this softening that pulled our RevPAR results down to the bottom of our outlook range. It was healthy out-of-room spending that kept us in the middle of the total RevPAR range. Non-room revenues accounted for over 38% of total revenues in Q1, an increase from just under 37% a year ago. Our efforts to grow non-room revenues and profits through our transformational redevelopments continued to bear fruit. Los Angeles had an especially tough quarter, as expected. The fires and the aftermath significantly reduced demand from both leisure and business travelers, group and transient. Displaced homeowners and first responders provided only a very brief lift during the week of the fires and only a minor benefit thereafter. RevPAR for our nine West Los Angeles properties declined 23.4% in Q1, with occupancy down 18% and rate down 6.5%. While the Hyatt Centric renovation contributed modestly to the negative impact, the vast majority was directly related to the fires. All nine of our LA properties had negative RevPAR, and they represented seven of our eight worst-performing properties in the quarter. EBITDA for our LA properties declined by $5.7 million, or 72.6%, compared to last year. A very challenging quarter and quite a drag on the entire portfolio, yet not quite as bad as we were forecasting. Business and leisure travelers to LA have been gradually returning as we've moved further away from the fires and the initial misperceptions about widespread damage to LA and its amenities and visitor attractions. We're still forecasting a negative EBITDA impact in the second quarter, but the good news is we now expect it to be around $1.5 million, or about $1 million less severe than we forecasted 60 days ago. However, we do expect some lingering price competition through the summer that could modestly pressure results in the third quarter. Outside of LA, portfolio performance was strong in the quarter. Thirteen properties achieved double-digit RevPAR growth, led by many of our recently redeveloped properties, including Viceroy D.C., Estancia La Jolla, La Valencia Hotel, Harbor Court in San Francisco, Chaminade Resort and Spa, and 1 Hotel San Francisco, which just continues to gain share. We continue to be watchful of signs that would indicate a further slowdown in demand. So far, we haven't seen an increase in group cancellations or attrition outside of government or government-related groups and government transit. We also haven't seen a pullback in out-of-room spending, nor have we seen any increased caution among groups that are actively meeting. However, we have begun to see a few concerning signs, including a slowdown in group leads for the second half of the year, a longer lag in contract execution, and more caution among some meeting planners in committing to future events, particularly in the second half of the year. Given today's high level of economic uncertainty, there's every reason to remain cautious about the second half. Unless there's a quick resolution to the current trade disputes, it's not unreasonable to expect further economic slowing, which could pressure demand for meetings and hotel rooms. While 60 days ago, we weren't forecasting a reversal of the outbound-inbound international travel imbalance, we also weren't forecasting it would get worse. Unfortunately, U.S. government-provided statistics show that the unfavorable balance worsened in March as outbound travel continued to grow, while inbound international travel declined by 10% compared to last year, a reversal from the monthly improvement in international inbound travelers that has consistently occurred since the end of the pandemic. Given the anger and dissatisfaction around the world with the U.S. government's proposed tariff and trade policies, it's reasonable to assume some continuing negative impact to inbound international travel this year, but perhaps not as bad as the initial reaction in March. When we look at our group and total revenue pace for the rest of the year, we continue to be ahead of last year for the second and fourth quarters, but our revenue pace for Q3 is now flat. Specifically, group pace for the balance of the year is ahead 0.3% in rooms, 2.5% in ADR, and 2.8% in group revenue. Total pace for the balance of the year, in other words, group and transient combined, is ahead by 5.1% in room nights, down by 0.8% in rate, and up by 4.3% in revenue. Our nominal revenue pace on the books for the balance of the year declined by $3.7 million since last quarter, though it was largely due to LA. We were expecting our nominal revenue pace to increase over the course of the year, but unfortunately, that was not the case during the first quarter. We believe this reflects greater caution on the part of industry customers and is a reason to be more cautious about the second half of the year. Ray mentioned that we saw some stabilization of the softening in April. I'm not sure that applies to the industry, but for our portfolio, we had a good setup for April with a very strong convention calendar in San Francisco, continuing healthy demand recovery in Portland and Chicago, a good Boston, and a much less bad Los Angeles. Our preliminary numbers for April RevPAR point to an approximate 3.5% gain over last year, with that growth number being closer to 5.7% without Los Angeles. These favorable preliminary results were achieved despite the negative holiday shift and continue to show the upside from both our redeveloped portfolio and markets like San Francisco, Portland, and Chicago, which are now outperforming due to a slower recovery in prior years. With April's numbers, Q2 is off to a good start. However, May and June do not look as favorable at this time. Before I move to our revised outlook, I wanted to provide a little more perspective on our intents and, as Ray described, our team's relentless focus on creating ongoing operating efficiencies within our portfolio. These efforts primarily accounted for the hotel EBITDA beat in Q1. This effort is all-inclusive. Every major and minor expense category is under the microscope. Within our portfolio and at every one of our hotels and resorts, our teams are subjecting every expense item to scrutiny, utilizing our extensive proprietary best practices database, an excruciatingly detailed benchmarking effort, and a mentality and approach that every expense item can be reduced through these widespread efficiency efforts. Working collaboratively with our operators, our teams are rebidding all third-party product and service contracts. We're reducing or eliminating expenses where returns are insufficient. We're improving labor management with new technologies to organize staff and schedule our property associates most efficiently. We're maximizing our procurement processes. We're exhaustively challenging real estate tax assessments. We're implementing physical and operational improvements to reduce risks related to hotel associate and guest accidents. We're investing in energy efficiency and property resiliency projects to reduce energy and utility costs, and we're making significant investments in physical improvements to mitigate future losses from hurricanes, atmospheric rivers, fires, and other natural disasters. We're auditing and revising property operating procedures to reduce energy and utility consumption. We're clustering more operating teams where possible to reduce costs. We're leaving no stone unturned. The success of these initiatives clearly showed in our first quarter performance. Our teams deserve a tremendous amount of credit for the results they've delivered so far. We applaud them for their thoughtful and relentless efforts, which continue. Now, let me move on to our outlook. As we indicated in our press release, we're slightly reducing the top end of our full-year outlook while lowering and widening the low end of our revenue, EBITDA, and FFO assumptions. These adjustments shouldn't come as a surprise. These changes are in response to broad-based expectations for continued economic slowdown, driven by the sharp rise in uncertainty created over the past 60 days stemming from changes in government policy proposals, activities, and rhetoric. Key economic indicators, including consumer confidence, business confidence, and investment and spending forecasts, have all substantially declined in the last few months. Whether actual spending follows these declines remains to be seen. Our expectation is that our operating results for the first half of the year are likely to be within the outlook range we provided 60 days ago, with Q1 beating and Q2 likely achieving towards the lower end, but on a combined basis, achieving somewhere in the middle of our original guidance. It's the second half of the year that we're lowering in response to the mounting uncertainty regarding the economy and increased expectations for a slowdown, along with reduced government and international inbound demand and early indications of a lack of pickup in bookings for the second half of the year, particularly the third quarter. Our updated outlook demonstrates a cautious approach to navigating what we expect to be a tougher economic environment, especially the second half of 2025, given the increased uncertainty. Our experience gained in prior cycles suggests that heightened uncertainty around major economic policies often leads to a pause or a reduction in spending and investment, including for travel. The midpoint of our revised guidance for the year continues to reflect our expectation of the most likely outcome. If trade policy issues are favorably resolved in the next couple of months, we believe the economy could rebound quickly, putting the upper end of our range well within reach. The good news is there's no current financial crisis or problematic structural issue at this time. The economy entered this year in a very strong position, with full employment, accelerating corporate profits, and the consumer in good financial shape. Reaching the bottom of our outlook range, on the other hand, would likely require a more meaningful slowdown and maybe even a mild recession. That downside case implies that same-property RevPAR would have to be at the low end of our range for Q2, then decline an average of 3% year over year in the second half. We hope this level of detail helps to frame the range of possible outcomes as we move through the year. To wrap up, we believe strongly that our intense focus on generating operating efficiencies, our disciplined commitment to driving revenue every which way we can, our team's deep cyclical experience, and the benefits from the substantial investments we've made to upgrade and transform the vast majority of our portfolio put us in a great position to outperform and drive long-term value. We're generating substantial free cash flow, and if conditions should deteriorate further, we certainly have the flexibility, the liquidity, and the experience to adapt quickly. That completes our remarks today. We'd now be happy to take your questions. Christine, you may proceed with the Q&A. Thank you. We will now be conducting a question-and-answer session. We ask that all callers limit themselves to one question and one follow-up. If you have additional questions, you may re-queue and those questions will be addressed, time permitting. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two 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 Star keys. One moment, please, while we pull for questions. Thank you. Our first question comes from the line of Jay Kornreich with Wedbush. Please proceed with your question. Hi. Thanks. Good morning. I guess just starting off, as you commented that the first half of the year outlook largely stayed intact after a strong first quarter with the downward revision coming mostly in the second half. I know you made some comments on this, but can you just further dive into the second half impact, something you're already seeing in the bookings, that slowdown, as you commented, and the group demand? Or is it mostly really just related to the potential impact should a mild recession occur? Yeah. It's related to two things. First, mostly related to the potential for a pullback in demand from all the segments in response to an economic slowdown if it should occur. It also is, of course, some response, as we mentioned about Q2 being at the lower end of our original expectations. It is in response to reduced government travel, government-related travel, and less international inbound travel overall. While those are small segments, again, one or two points off of the demand at the end of the day is really where we thought the full year would be in terms of being up one or two points of demand. That is really part of it. For the second half, it really is all about the potential for downturn based upon this increased uncertainty that we are seeing in the economy and with government policies. All right. Thank you. Just maybe as one follow-up, just looking at the business trends in customer, which in the first quarter had some positive upside. Are you already seeing corporates being more hesitant in spending and travel? That is potentially a big leg that could come down? Or so far, is that segment so far trending positively and could hold up maybe better than what you're already seeing in some of the government and international pullback? Yeah. So far, we're not seeing a downturn in BT. I think it certainly varies by industry group. We have some groups like financial, banking, technology that are up. There's some other industries that are down. In total, I would tell you that we haven't seen a decline in BT really in any of our markets around the country. So far, it's holding up. Now, if you read first-quarter transcripts of Fortune 500 companies, and I guess you can use AI today to look for the word travel, I think you're going to find numerous comments from companies saying, "Given all this uncertainty, we're looking at reducing costs, being more efficient, including travel or discretionary travel," or they might call it non-essential travel, although I think all travel's essential. It shouldn't be surprising if it does decline over the course of the year until we see a turnaround in the uncertainty side of the policies. So far, we haven't seen anything. Okay. Understood. Thank you. Our next question comes from the line of Smedes Rose with Citi. Please proceed with your question. Hi. Thanks. I just wanted to ask you on the tariff stuff, besides just sort of the broader weakening of the macroeconomy, is there anything kind of hotel-specific that you would expect to see costs go up either on the food side or kind of hard goods? I'm just not really familiar with kind of where all that stuff comes from. Would you expect that to have some sort of negative impact? Yeah. There is no doubt it is going to have an impact on new construction, on renovation projects. Most FF&E is made outside of the country. Almost all lighting, electrical, is made outside of the country, outside of the U.S. We certainly would expect some impacts in those categories. There are consumables, operating supplies and things, some of which come from outside of the country. Interestingly, from what we understand from Avendra, who we use at most of our hotels, a lot of the sustainable operating supplies are not made in the U.S. They're made outside of the U.S. We would expect some kind of impact from them. Again, all depending upon what happens with these tariffs and how much of that flows through to price increases or flows through to shortages or supply chain issues. We haven't seen anything yet, anything material yet, but it's early, right? I mean, this was all just announced less than 30 days ago. Yeah. And Smedes, also, we don't just sit there and take it. For example, some of the food that we're importing, those costs go up for the tariffs or whatever it is. Our teams look at different menu items. How do we price things differently or do things differently? When we have these actions coming in, they adjust. They're very nimble. As we saw the first quarter, they've done a great job adjusting in a very short period of time. Okay. I just wanted to ask you, you mentioned government or government-adjacent demand at kind of 3%-5%. For your portfolio, is that concentrated in any particular market, or is that sort of spread evenly across your hotels? It's spread all over the country. I guess that the heavier concentrations would be in Washington, D.C., and in San Diego. Now, San Diego tends to be dominated more by defense and military, which, from what we understand, is less impacted overall. A lot of the sort of government-related has to do with healthcare, NIH sponsorship, or university research sponsorship. That tends to be all over the country, not in any particular market, particularly when they have conferences and group meetings. Okay. Thank you. Thank you. Our next question comes from the line of Floris van Dijkum with Compass Point. Please proceed with your question. Hey. Good morning, guys. Jon, maybe if you could comment on the transaction markets and also your ability to, given the share price weakness, you bought back a little bit of stock. Can investors expect more of these share repurchases going forward? Yeah. Hi, Floris. This is Tom. In terms of the transaction market, I think just given some of the comments we made in terms of the uncertainty into the second half of the year, I think the sentiment has turned from risk-on to risk-off. Nobody really wants to kind of go to investment committee today and say, "We've got this," until there's a little more clarity in terms of where operating fundamentals are going to be. I think it's still a functioning market. I'm just not sure how constructive it is currently. I think for the most part, people are going to be more in the wait-and-see mode. If we can get resolution to this in the course of the next 30, 60, 90 days, I think we'll see a pretty active pickup during the latter half of the year. Floris, your question on the buybacks, we'll evaluate the macro, how the conditions are in uses of the capital. As we were, we did buy back some shares in the first quarter. We'll evaluate what's going on in the macro. Even with the revised outlook, our free cash flow is well over $100 million a year, and that's after CapEx. We do not have any meetings to have to pay a common dividend. We have a lot of flexibility. We are building greater cash reserves. Now, some of that is to address the convertible notes that will mature at the end of next year. With the free cash flow and all that, it allows us to be a little more flexible. We will evaluate what is happening in the macro and make the decisions. We do not commit to any sort of numbers at this time. Thanks, Ray. Our next question comes from the line of Sean Kelly with Bank of America. Please proceed with your question. Hi. Good morning, everyone. Thanks for taking my question. Two for me. First of all, you kind of already talked about some of the D.C. exposure, I think, to Smedes' question. But Jon, could you just give us a little bit of thought of sort of the Washington, D.C. submarket? Obviously, the hotel industry kind of revolves around this. In just pure reported RevPAR terms, we have not seen the step function that correlates with the sort of types of numbers we have heard. You're not the only one to call out a step function in government demand as it relates to the broader travel industry. I know a couple of the airlines said the same. Can you help us square that? Just what's supporting D.C. right now? Is this sort of just a delayed thing? Just a little bit more color on kind of how that market's doing all right, but we are seeing this kind of big step function down in government demand. Yeah. Sure. Boy, I wish I could bring clarity to what's going on in Washington, D.C. but I'm not trained for that. In terms of the lodging market, there's a lot of cross currents, Sean. There's some positives. We had quite a few positives going into the year. We had a change of administration, which is typically positive for demand in the market. We have the first year of a new president's term, which tends to be a very active legislative year, which is positive for travel, typically in the market. You also compare against next year, later in the year, where there's no election, which tends to be a very positive comparison for the year. We have the federal government workers, those who have not been fired or laid off or in limbo, who have been ordered and have gone back to the office. We see that here in D.C. in traffic being almost back to normal or back to where it was sort of pre-pandemic in the marketplace. We have a lot more congressional days on the calendar this year than we had last year. That, of course, brings a lot of weekday demand into the market. We expect there to be more protests. There are a lot of political cross currents, obviously. That is good for the market. We have a decent convention calendar this year until the fourth quarter, where it is softer, but we have the benefit of the no election, which would offset it. It is like the first quarter. We actually had a soft convention calendar in the first quarter, but the inauguration and activities around that and the new government offset that in the first quarter. I guess the last thing is we have a lot of people from governments around the country coming to Washington. There are all these trade agreements to be negotiated. That is bringing people here. There are a lot of people here coming to meet with the president and the new administration, from around the world. There is a whole bunch of positive cross currents, in addition to the negative impact from freezing government travel, eliminating "non-essential travel," or a lot of government-related cancellations. Hopefully, that is helpful in explaining sort of the positive side of things that are happening here, in addition to the negative things that we read a lot about. Yeah. That is super helpful. Just as a short follow-up, kind of curious on the—and I'm not meaning to split hairs here, but just since we're all living by every sort of incremental data point right now, the April commentary sounded great. You said May and June a little bit softer. Easter's thrown a wrench into a lot of the way that I think we are trying to look at comps and modeling and everything. It has been real hard to read the underlying trend. What do you kind of chalk that change up to? Maybe if you could, a sense of the magnitude of deceleration that you're seeing, that'd be helpful. Thanks. Yeah. I mean, it's not a deceleration. It has more to do, again, with the setup of the way the conventions work. I'll give you an example. In San Francisco, RSA, which is the big computer security, cybersecurity citywide that happens there every year, last year was in May. It moved to the last four days of April this year. San Francisco gets a huge lift in April, great setup. May gets challenged. Now, May actually has a decent year-over-year calendar, but it's not as healthy as this large citywide. It's a few sort of small to medium-sized citywide. That's an example. The setup, the way the conventions fall year-over-year, those things have an impact on this sort of month-to-month comparison. That has an impact on the pace that we look at, where our May pace is a little bit softer. Our June pace gets a little better again in the portfolio. We'll see if that holds up between now and then. It's not something we're seeing in trends. Again, it has more to do, in particular, with our portfolio setup and the markets we're in and the individual properties that we're in. Thanks so much. Great talk today. Yep. Thank you. Our next question comes from the line of Duane Pfennigwerth with Evercore. Please proceed with your question. Hey. Thanks. Sorry we're juggling multiple calls today. How do you think about the recovery curve in Los Angeles, and what will be the leading indicators for that market to fix itself? Yeah. I mean, it's a simple answer. The leading indicators are the bookings and where they're coming from. Are they coming from our traditional industry groups and travelers? Is it coming from the entertainment industry? Is there increasing production in TV, film, commercials? Are the music folks continuing to come and coming back, where they come and practice for three weeks before they go out on tour in LA? Is the fashion industry demand returning? Are the companies in Silicon Beach, the tech companies and the entertainment and social platform companies, are they back to their normal travel policies? What we've heard from them, we talked about this last quarter, was their expectation that by March, April, maybe at the latest, they'd be back to normal travel. It is what we're seeing. The pace of pickup, the interesting thing about LA, there's not a lot of citywides. There's certainly not a lot of citywides downtown to begin with, but there are not many of those that even impact West LA. We have a few major events, like the Milken Institute event that I think is later this month, or maybe it is in early June. I forget where it is this year. That impacts the West LA market because of that volume. What we have seen, Duane, is we have seen most of that business rebook. It is a very short-term market. We were in a bit of a hole for Q2 in terms of the starting pace. We are still going to be off in Q2, but each month gets better. The pace of pickup is back to where we were. It is really just where we are starting each month that has put us in the negative holes. That sort of start position, the booking pace, is less bad as each month goes by. All of those things are the things that we look at. Really, it's the feedback from our clients, and not just the words, but are they booking? We see it really quickly in that market because it's so short-term. Thanks for that. I do not know if there's any good way to measure this, but what is drive-to demand in your portfolio, and how might that be changing? Just how do you think about it? What% of your mix is drive-to? How might that be changing? Thank you. Yeah. I mean, I'd love to be able to tell you we know how to measure it, but we do not ask people how they got there. We do not have data for that in our markets. I would say, obviously, for the most part, all of our resorts are drive-to. That's a conscious effort on our part. Strategically, it's not to say properties in the Caribbean or in Hawaii or other fly-to destinations aren't attractive. We've just chosen not to be there for different reasons. All of our properties are drive-to. Even some of the major markets, like San Diego, is a good example. It's a huge drive-to market from LA, from Arizona, Phoenix, Las Vegas. In the summertimes, in particular, when things get really hot in those markets, a lot of folks just drive into San Diego. We see a lot of leisure business that's drive-to in a market like that. Our Santa Cruz business is almost all drive-to for our Chaminade Resort. Our Skamania property, again, is almost all drive-to. We do know that from which are the groups that are there, where their office is. It doesn't mean they don't have some people coming from outside of the market, but the business demand generator is usually in or near the market being regional. Newport Harbor Island Resort in Newport, it's a mix of drive-to and fly-to. Providence is easy to get in and out of, or even Boston. It is a big drive-to market from New York, as you probably know. We do tend to benefit when folks are making decisions about how they spend their money and do they want to save a little bit but maybe still take a vacation. The drive-to markets do tend to benefit. Now, again, we tend to be in the upper end of the socioeconomic customer, so they're a little less impacted by downturns, typically. Those that are, we get benefits from the fact that they're drive-to. Dwayne, this is not a perfect indicator, but at our resorts in Q1, our parking revenue was up over 10% compared to overall 7% revenue gain for the quarter. That could be a function also of revising parking agreements and those sort of things. It does indicate we get both fly-to and drive-to. It is encouraging. That is why it is helpful in downturns, the drive-to component, if some people trade down if they are not flying out to Europe and they are staying domestically. Thank you. Thank you. Our next question comes from the line of Jamie Feldman with Wells Fargo. Please proceed with your question. Great. Thank you. I appreciate all the details focused on expenses. Can you just talk more about where you think there's still the most juice, just in case you do get the pullback on the top line and the back half, and expenses can be even more helpful? Yeah. I mean, I think it's pretty comprehensive across the entire expense line item categories as it relates to the efficiency and the cost reductions that come through that. I think when it comes to sort of the hunkering down reaction, our industry loves to call these contingency plans. Of course, we have level A, B, C, and D at all of our properties. We always look at them and say, "Well, the A ones, we should be doing those all the time." It's not a contingency plan. It's a better way to operate the property. Then we start getting into B, C, and D. As we get deeper into it, it tends to be deeper people cuts. It's about how do we get the same amount done with fewer people, basically people working harder and smarter as things get tougher, more cross-training utilization, less staffing of hourlies, and having managers pick up shifts, which is not a permanent solution, but it's a temporary solution when you have a relatively short six-month, nine-month, a year drop in volumes. When things get tougher, the hunker down tends to be more people. Okay. Thank you for that. As you think about the potential tariff impacts on CapEx, how do you think about maybe changing some of your strategies in terms of areas you wanted to invest? Maybe even more importantly, as you think about the competition or assets you've had your eyes on, do you think this is going to change competitors' appetite to invest and open up more opportunities for you on the investment side, or are we just not there yet? Two things. First of all, in terms of our capital, the good news is over the last five years, we went through this massive comprehensive redevelopment within our portfolio of pretty much all of our assets. Outside of the potential conversion of Paradise Point to Margaritaville, all of our major projects are done. We don't have any major platform or portfolio-wide programs at this time. The capital that we—I mean, and we just completed really the last of them, which was not originally planned, but the brand change and renovation of what's now the Hyatt Centric in Santa Monica. We're really done with the need to go out and buy FF&E and do major renovation projects through the portfolio. Most of where we're spending capital relates to infrastructure. Most of that is not impacted by tariffs. It's material supplied in the U.S. We haven't really heard of much impact at all from any of those projects that have moved forward. We do have major equipment. Sometimes, on occasion, it's made outside of the U.S., but a lot of it is made here in the U.S., whether that's HVAC equipment. Then we have other ROI projects, many of which relate to sustainability and reducing consumption. Some of that comes from outside of the U.S. LED bulbs and things like that, in many cases, come from outside the U.S., as do some of those fixtures. Again, we haven't seen any change in those costs yet. I suppose, Ray, any of the solar projects we've been looking at could get affected based upon these tariffs on solar. It could. Fortunately, for some of those solar projects, we bought ahead of the tariffs, so we have some of that in storage. Yeah, some of those areas could put a crimp on it. Look, I think the bigger picture, there's a lot of focus right now on the macro and anxiety around what's happening or not happening with demand. Longer term, this should make replacement costs and construction costs go up, which further pushes the new supply risk down. It's already very low. I know most people aren't focused on that right now. Over the next three to five years, it's going to continue to put pressure on new supply growth, which is great on our ownership side. Maybe not so much if you're a developer, if you're a brand, but for our side, that's great in a lot of our markets. I think to your comment about, "Do we change the way we're allocating capital, and will this create opportunities for acquisition?" I think for now, where we're going to put capital is going to relate to buying our stock back because we can buy our existing assets back at a way bigger discount and much greater value creation than anything we could buy on the market today. There's no tariffs on buybacks. There's no tariffs on buybacks. Okay. Be careful what you say. You never know. It could change tomorrow. Exactly. We don't want to give anybody any ideas. That's right. All right. Thank you very much. Our next question comes from the line of Gregory Miller with Truist. Please proceed with your question. Thanks. Good morning, everyone. I'd like to ask a question in a similar context to Dwayne's question. Speaking about your drive-to resorts, what are your current expectations for summer performance? Maybe specifically for the resorts that have stabilized operations or are pretty close to that stabilization, do you expect that you're going to have positive rooms RevPAR year over year this summer? Thanks. Yeah. I'd love to be able to answer that. I think there's just too much uncertainty now. A lot of our, particularly our leisure business in the summer, Greg, is very short-term booked, particularly at the margin, right? You get a lot of repeat business, and some people plan ahead, but you get a lot of people who decide spur of the moment or within a week or two or a few days of when they want to take a vacation. It is too early to tell. I mean, the vast majority of our resorts are going to benefit from their redevelopments. We do not really have many that are stable at this point in time in terms of the resort category. Maybe a Paradise Point at this point, but all the others benefiting from more recent redevelopments. It is just too early to forecast what the summer leisure business is going to look like. Okay. Understood. Maybe just switching to a different topic. You were speaking about potential labor reductions and operating efficiency efforts. For anything that's guest-facing and playing a little bit of a devil's advocate here, how are you preventing guest satisfaction scores or your rate positioning not being negatively impacted by your efforts? Yeah. That's a big focus of ours is before we implement things in the portfolio, we're always looking at what impact will this have on the customer experience. As you know, particularly with our independent hotels, but really all of our properties, including a lot of our major branded properties, which tend to be lifestyle-focused, we are focused on the experience that the customer gets. That's a big part of the transformations and redevelopments and amenities and reconcepting that we've done. We don't want to do anything that the customer cares about. There are often things the customer does not care about, does not want to pay for, that either a brand or maybe things that might have been done in the past where the customer's interests have changed. Those we would make changes on and be open to making changes on. Most of what we are talking about has to do with efficiency, not changing the service. We are constantly monitoring the customer reviews. Our rankings of customer satisfaction have gone up consistently every year since the pandemic, before the pandemic. That is a high focus of ours as well. Customers are quick to tell you when they are unhappy. If we do something that creates unhappiness, we are going to reverse it pretty quickly, assuming we think it is going to have an impact on business. Thank you, Jon. Thank you, Greg. Our next question comes from the line of Ari Klein with BMO Capital Markets. Please proceed with your question. Thanks. And good morning. Jon, I think you previously talked a little bit about seeing some price consciousness on the part of higher-end consumers. Curious if you're seeing that now and how you'd expect that to play out, particularly as it relates to maybe rates moving through the rest of the year. Yeah. I mean, clearly, if you look at our portfolio, our gains have primarily been through occupancy, not as much through rate. I think that's a result of two things. One is mix, where the additional occupancy is coming from within the portfolio. We've talked about that in previous calls. And then two, yes, sensitivity on the part of the customer, them waiting to buy when things are on sale or discount or special offerings. We try to do value-add offerings at most of our properties versus just discounting, but sometimes we have to do discounting to drive marginal occupancy. Given the spend that goes on at our properties, we've determined that in almost all cases within our portfolio today, occupancy is as profitable as rate is within our portfolio because of all the additional spend that's been added and that occurs through all the amenities that we've added at our properties. That tends to be the way we're focused on it. It's not all about just price. Yes, we've been seeing price sensitivity really since 2022, particularly when people decided that they didn't want to pay that extra money for suites or for view rooms. We're always balancing what those premiums are for those premium rooms. Thanks. Maybe just going back to D.C. and the DOGE impacts, curious how you think about that market longer term and if your views there have changed in it anyway. I'm not sure I follow that question. Shoot it to me again. On D.C., does what's happening with DOGE change your longer-term views on that market and how much exposure you'd want to have there? It really doesn't. Again, as I mentioned, there are a lot of good things going on in D.C. D.C. is very resilient, has been over the decades. I've lived through many presidents who came in to make cuts and some who were successful and some who were not. Government growth itself hasn't been the driving force behind D.C.'s growth over the last probably 20 years. I mean, the size of the government workforce here hasn't increased over that period of time. It's really all the private industry and, of course, business that does serve government that chooses to try to co-locate in the market, and particularly in Northern Virginia or Maryland. I don't think our view on D.C. changes. I think this administration has four years left and will move on to the next one who may have a completely different viewpoint. Thank you. Our next question comes from the line of Chris Darling with Green Street. Please proceed with your question. Thanks. Good morning. Jon, your framing of government and government-adjacent exposure earlier in the call was helpful. Can you do the same for international travel? What are you seeing in the bookings data for international? How does that kind of compare with sort of the tough outcome in March? Where do you think the portfolio might be more or less at risk going forward? Yeah. I mean, again, I think our industry doesn't do a great job with our own data in terms of where the customer comes from because a lot of times if an international traveler books their business and they do it through a U.S. travel agent, they don't show up as an international inbound. Frankly, we're a little more forced to look at anecdotal information and then look at the government data when it comes out on a monthly basis. The good news, at least, about the government data is it's a lot more timely than it used to be. It's only about a month behind from a time perspective. It used to be six or nine months or some crazy amount of time. I think there likely was some impact from the Easter shift that hit March hard. We'll see what April looks like and see how much of that reverses. I think in my comments, I mentioned I do not think it's likely to continue at the sort of down 10% that March was on a year-over-year basis. Frankly, we do not know. We are going to have to wait and see. You are talking about human behavior and reaction to government policies and rhetoric and things being said. We just have to wait and see. We've heard from some of our conferences that people have had a hard time getting visas to come in for some of these conferences, that it's taking longer. They are not getting their visas or they are getting them a day or two before the conference, which makes it hard for people to plan and commit to traveling. We've been talking to the administration as an industry about trying to speed that up since that's an export, if you will. It's great for people to come to this country and spend money. We want them to feel welcome to do that. We are trying to help push to create that environment. Clearly, that's not the environment that is the perception right now on the part of travelers. A lot of uncertainty. The impact is probably more in the urban markets than it would be in our resort markets. It's probably the East Coast markets and Florida that would be the ones most impacted at this point. A lot of the Asian travel has already been slow to recover. Doesn't seem to be being impacted by the policies and rhetoric as much as European and Canadian travel. We're not in New York, which is obviously the biggest international market in the United States. The rest of our markets tend to be down in the mid-single digits, maybe D.C. in the upper single digits. Chris, I think it's also important to look at the other side of that ledger, which is the outbound from the U.S. travelers, which is way above where it was pre-COVID. With the concerns around the macro and all that and some people maybe staying close to home and drive to, that could be a benefit of some of this slowdown where there's more U.S. travelers staying domestically and vacationing here versus going out to Paris for the Olympics and going to Japan and Europe, which we've seen a lot. There's other side of the two. I think it's important to look at both sides of the equation when speaking to international demand. I think that, look, the dollar has softened and come down over the last month or two. That would normally be helpful to inbound international and would normally be hurtful for outbound. We will see what impact the dollar has as well on that imbalance. Got it. Yeah. That's all helpful commentary. Appreciate it. Maybe on just a more positive note real quick, I think I heard you say that Key West enjoyed positive RevPAR growth in the quarter. One of your peers, I think, reported a decline in Key West. Curious how your performance compared to the market there and maybe perhaps what you did right or what went right for you. It's really two things. One is we're benefiting from significant investment dollars that we've put into the Southernmost Resort and Marker in upgrading both of them. We're gaining share in the market on the market. That's number one. Number two is, I think, from a strategy perspective, we tried to get out in front of what we expected to be some slowdown in demand. We put more business on the books further out. That's been helpful. Got it. Thank you for the time. Yep. Thank you. Thanks, Chris. We have reached the end of the question and answer session. Mr. Bortz, I'd like to turn the floor back over to you for closing comments. Thanks, everybody. For those who are still there, we appreciate you taking the time. We know it's a busy day with lots of calls. We look forward to updating you in 90 days. Hopefully, we'll have more clarity at that point in time. In the meantime, I hope you'll have a nice summer. We'll talk to you in late July. Thank you. Ladies and gentlemen, this does conclude today's teleconference. You may disconnect your lines at this time. Thank you for your participation. Have a wonderful day.