PK - NYSE

Greetings and welcome to the Park, Hotels and Resorts First Quarter 2025 Earnings Conference Call. At this time, all participants are in the listen-only mode. [Operator Instructions] A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to turn the floor over to your host, Ian Weissman, Senior Vice President, Corporate Strategy. Ian, please go ahead.

Thank you, operator, and welcome everyone to the Park, Hotels and Resorts first quarter 2025 earnings call. Before we begin, I would like to remind everyone that many of the comments made today are considered forward-looking statements under federal securities laws. As described in our filings with the SEC, these statements are subject to numerous risks and uncertainties that could cause future results to differ from those expressed, and we are not obligated to publicly update or revise these forward-looking statements. Actual future performance outcomes and results may differ materially from those expressed in forward-looking statements. Please refer to the documents filed by Park with the SEC, specifically the most recent reports on Form 10-K and 10-Q, which identify important risk factors that could cause actual results to differ from those contained in the forward-looking statements. In addition, on today's call, we will discuss certain non-GAAP financial information such as FFO and adjusted EBITDA. You can find this information together with reconciliations for the most directly comparable GAAP financial measure in this morning’s earnings release, as well as in our 8-K filed with the SEC and the supplemental financial information available on our website at pkhotelsandresorts.com. Additionally, unless otherwise stated, all operating results will be presented on a comparable basis. This morning, Tom Baltimore, our Chairman and Chief Executive Officer, will provide a review of Park's first quarter performance and strategic initiatives as well as updates on our 2025 outlook. Sean Dell’Orto, our Chief Financial Officer, will provide additional color on first quarter results and 2025 guidance. Following our prepared remarks, we will open the call for questions. With that, I would like to turn the call over to Tom.

[Operator Instructions] Our first question today is coming from Floris Van Dijkum from Compass Point. Your line is now live.

Hey good morning guys. Thanks for taking my question. Tom, maybe if you could comment a little bit on the planned asset sales and how confident you are in the current market environment and being able to achieve decent prices as well as having willing buyers.

Yes, it's a great question, Floris. And look, we've got tremendous uncertainty right now for all the reasons that we all know, geopolitical; obviously, the tariffs, obviously leading to trade wars and uncertainty is the enemy of decision-making. So I think for many business leaders men and women there probably hesitant, they're probably pausing in many situations and certainly being cautious. No difference than what certainly we're seeing and probably a lot of our peers, hence the reason that I think everybody has been sort of a little more cautious on forward guidance. I would say that this team has really separated itself in being able to transact even under the worst of circumstances. If you think back since the spin, as we pointed out, we have sold or disposed of 45 hotels, including 14 international for north of $3 billion. We do have one asset under contract, very attractive pricing. And look, we are cautiously optimistic, but we're not going to comment and give any details until it closes. We just think that's the prudent thing to do, but we also have a number of other assets that are at various stages of the marketing process. There's plenty of liquidity. There's plenty of equity capital. There's plenty of debt capital and if I'm a small family office, owner-operator, midsized PE firm, these periods of dislocation, I think, can be a really unique opportunity to certainly buy assets. So we are being very targeted. We're being very focused. And I think we've again demonstrated every year that we've been able to sell assets. We've raised the bar a little higher this year, but we're still working our butts off to -- to get as many sales done this year as we can. And we are confident that we will achieve our objectives.

Thanks, Tom. Maybe my follow-up, maybe if you can comment a little bit more on Hawaii. Obviously, RevPAR was down think 15% in the quarter, you said it drags for the overall Hawaii Village was a 420 basis point drag on overall results. How is the ramp up of the -- obviously, the strike disruption in the fourth quarter, but also the renovations that have just occurred, how quickly will it ramp up in your view? And how dependent are you on the international tourist for some of that ramp?

Well, listen, the ramp is taking a little longer as we come out of the strike. Obviously, the strike was 45 days, it certainly had an impact and we are seeing sequentially improvement. I mean we were down obviously, Hilton Hawaiian Village about 15%, obviously, in the -- excuse me, 18% in the in Q1. As we look at April, we're down about 7%, and we're probably going to be down, we think, for the quarter, probably high single digit, low double digit. So certainly seeing improvement there. Feel very good about third quarter, probably mid-single-digit positive as we think about RevPAR. And as Sean pointed out in his remarks, we've got really favorable and easy comp in Q4. So overall, we think it's going to be a solid performer. Long term -- intermediate and long term, Floris, we could not be more confident about any market than Hawaii, just given the limited supply growth, given the historic nature of the market where it is, its RevPAR growth rates -- RevPAR growth rate has outpaced the U.S. by 120 basis points over the last 20 years. So we feel very good about it over the intermediate and long-term. And as it relates to the renovations that we've been very strategic, very thoughtful about it. Carl Mayfield and his team on our design and construction are best-in-class, best in the industry. And so we think there's really minimal disruption, particularly since you're lapping disruption from the previous year as we're completing and carefully phasing and staging our renovations there. And we don't have any issues in terms of supplies. We have what we need and are confident that we'll be able to get them done sort of on time, on budget as I think we've done as well as anybody in this sector and particularly given the nature of our portfolio.

Thanks, Tom. Appreciate it.

Thanks.

Thank you. Next question is coming from David Katz from Jefferies. Your line is now live.

Hey good morning everybody. Thanks for taking my question. Look, I wanted to just follow up on the prior conversation about asset sales and the market will be what it will be, but it does look like you've sort of trimmed your core hotels to a smaller number, right, 25 to 20, if I'm seeing that correctly. Maybe we should just talk about that and sort of what the -- what's going on with the 5 and sort of how we're thinking about the -- that change, please?

Yes. it's a great question, David. We have -- as a team, again, back to the earlier comment I made, we have worked our tails off, and I know you know this and really looking to reshape the portfolio based on additional work. And as we've looked at capital allocation, where do we want to be allocating capital. It's really those top 20 assets that really account for about 85%, 90% of the value of the company. And so we've made the decision that those are the core assets, the other remaining assets, we want to work really hard to recycle that capital to sell those assets and take those proceeds and pay down debt, reinvest in strategic ROI projects as we're talking about in Hawaii and New Orleans and obviously, Miami. And then obviously, in periods of dislocation be prepared to buy back stock. And look, we have -- we've bought back 26.5 million shares over the last 2.5 years. So I think we've been as prudent as anybody from a capital allocation standpoint and very confident in those 20 hotels being sort of our core and then working as aggressively as we can to sell the noncore. And that can be different combinations. You saw in Oakland last year, non-performing difficult market, we closed the hotel. You've seen other situations, they are short-term ground leases, we'll work to figure out a solution for those situations. But we really want to get the core portfolio down to those core 20 hotels where the real embedded value of the company lies.

Understood. And if I can just follow up quickly. With respect to the CapEx that's planned, notably Miami, which is important, over the course of the year, it seems to me that you've sort of embarked on that. Maybe you could talk about how much of that cost is really sort of -- and timing is sort of locked in at this point, just given the limited visibility in the marketplace? Thank you.

Yes. It's another great question, David. I would say you heard me make this the earlier comment. You've been down -- you've seen, obviously, what we've done in Orlando with the Bonnet Creek and how well that's performing and the complexity of that. And I say this respectfully, there's not another team in the lodging REIT landscape that has that experience and has that ability to be able to handle it. Miami, this is what we do. Carl Mayfield and the team have studied the situation carefully over the last year. We've bought out many of the subs. We have the GC. We have the permits. We have suspended operations. We will be preparing and fencing around, and we're confident that we will deliver before June of next year for the World Cup. And we're excited. I mean, this is a complete transformation of guest rooms, public space, lobby, the pool area, food and beverage outlets. And we think, obviously, as we said, we think there's a great opportunity not only for 15% to 20% on 25% unlevered returns, but the ability to really double EBITDA as well. And in a market where you've got such high end, The Albers coming, Rosewood, The Aman, The Andaz obviously, will open at some point, and the ability for us to talk underneath that and be able to really significantly increase rates, and given the quality of that location, mid-beach, right next to the lows, we're really excited about this project as we move forward. We realize there's some near-term disruption, but we think for intermediate and long term and for real value creation for shareholders, it's the right decision for us to make. We also believe passionately that we can deliver higher development yields than we can acquisition yields, and that really plays to our strength as a team.

Appreciate it. Thanks very much. Good luck.

Thank you.

Thank you. Our next question today is coming from Duane Pfennigwerth from Evercore ISI. Your line is now live.

Hey, Dwayne.

Hey. Thanks. Hey, good morning. Just wonder if you could give us your updated views on markets that you expect to lead this year and the underlying demand drivers and correspondingly the markets that you expect will lag in your portfolio, and has that pecking order changed since one quarter ago?

Well, look, we've talked about Hawaii. We think obviously Hawaii is going to continue to ramp up. The Hilton Hawaiian Village obviously is on that. Given the post strike Hilton Waikoloa, we still are very bullish on that. We've obviously got significant increase in group business there, what's happening in Orlando and the double digit increase that we've seen at Bonnet Creek, we expect that's obviously going to continue to be a really strong performer. Key West, obviously, again, given the transformative renovations there and what we're doing and how well they did last year, we still continue to be very encouraged. New York City, I mean New York is up April 16%, 17% and we feel good about it in the second quarter. And it continues, obviously you've had very little supply added in New York and continue to be cautiously optimistic there. Caribe has been on fire and continues to perform very well for us. There we're expecting obviously Denver, given the management changes that we've made there, certainly to see sequential improvement there as we sort of look out. So we're overall, if you think about the first quarter, taking out Hilton Hawaiian Village from that standpoint and given the tough comp, I mean it would have been obviously a very strong nearly 4% increase in RevPAR for us. And given the fact that we've been so disciplined and I give a huge credit to our asset management team to Sean's leadership as well. As we look on the cost side, I mean we were up about 3.3% in expenses, but when you take out the one time anomalies, we were only up about one for a little over 1%. So I mean it's not just the top line of those markets, but it's the discipline as well on the cost side. And so I think we've done a really good job on that front and you'll see that kind of energy and effort to continue as we move forward.

Thanks, Tom. And if I could just follow up on one of those on New York. There's been so much intense media focus on potentially softer international inbound, less Canadian travel, etcetera. And so what do you think some of that media might be missing in terms of demand drivers to a market like New York? And thanks for taking the questions.

Yes, listen, New York, one of the great cities of the world, as we all know. And there's no doubt when you think about the frustration, the energy around the tariffs right now, there are going to be some obviously we saw a little bit of decline in the Japanese coming into Hawaii. That's still ramping up, but still, certainly still a little over 50% below where we were in 2019. International accounts for about 10% of our business overall. If you think about pre pandemic inbound into the U.S. was about 79 million. I think we're back to somewhere between 70 million and 72 million. About half of that comes from Canada and Mexico. Mexico has been pretty consistent. It hasn't seen a fall off. You've seen a little bit of fall off in Canada. And we're all hopeful just given the strong alliance and relationship that will get resolved and that will sort of resume. But certainly in the near term that is a little dilutive, but again for us it's less than 2%. So it's really not that significant to park and into our portfolio.

Thank you.

Thank you. Next question today is coming from Patrick Scholes from Truist Securities. Your line is now live.

Thank you, operator. Hi, good morning everyone. Question for you on the group pace. On the prior earnings release, it had been tracking six. Now it's one plus one for the year. I wonder if you can kind of give us an apples to apples for 2Q to 4Q. I know or suspect that 1Q benefited from the ether shift. So when you take that out, you sort of naturally the rest of your might have been softer. But how does that +1 for 2Q to 4Q compare to your prior projection? Thank you. Hopefully that makes sense.

Yes, Patrick, I believe so. Hopefully we'll get you a response that aligns with your thinking. But in the end, as we look at pace for I would say Q2 Q3 pace is roughly just slightly down 0 to 1% for Q2. And then Q3 is a little bit, it's weaker, it's down 10%. Hawaiian Village, a big driver of that as well as New Orleans and Chicago, which are both lapping strong Q3 performance on the group side. Last year, you recall, obviously Chicago had the D&C, so it's lapping that. But other than those, I would say the markets are pretty, pretty healthy for group pace in Q3 and then Q4 is a very strong quarter for us, up 18%. A lot of big drivers of positive pace and pretty much across the board, not too many properties dragging down the performance for group expected in Q4. So that's kind of how the pace goes. I would say that, you know, I don't think we've seen much decline in the near term. I think the definites that we've had on the books, which represent about, at this point, about 90% of the forecast have held. No -- occasional cancellation, a little bit of maybe wash, but been offset by rebase -- positive rebounds in other area. So it's generally held. So I think the group story for the year for us is look at it and plays into the guidance is just confidence in the year for the year bookings, which probably is not unique to us, just kind of thinking through the ability to pick up what's remaining in our reach for the rest of the year. I think we're -- the sales teams feel good, but as Tom mentioned, with the uncertainty out there, you're just kind of seeing some hesitancy and decision-making right now.

Okay, so when you said confidence, you mean is confidence or more. Sounds like there's not confidence. I just want to be clear.

Thank you. I think there's confidence out there that to kind of pick, pick up the remaining reach in the portfolio. We've obviously hedged a little bit of that in our guidance forecast, but anything too. I think the teams are generally positive on potentially transient side if to kind of cover for some of that.

Okay, thank you. If I could flip in one, one more. What are you seeing for a 26 and 27 group trends and how has that changed since you last reported? Thank you. And then I'm all set.

I won't speak to 27. For 26, we have seen a drop off again. I think as you think through some of the decision-making issues we're dealing with, I think you're seeing that play into it right now. I think it's more kind of the early parts of 26.

Thank you. Next question today is coming from Smedes Rose from Citi. Your line is now live.

Hi. Thanks. It’s Smedes. I just wanted to circle back on the Hilton Hawaiian Village. Sounds like sort of quite a few moving pieces there. And so, I mean, do you think realistically you could come in ahead of what you did in 2024 there on an EBITDA basis? I think you did a little over 160 million. It seems like from what you're saying that might be hard to achieve. But I just kind of want to maybe, I'm not reading what your remarks are.

Yes, we had trouble reading hearing you. Smedes, just say your question one more time.

For the Hilton Hawaiian Village. Do you think it's realistic that you can do EBITDA this year that's ahead of what you did in 2024?

Yes. I mean it's hard to say right now. Smedes, could we get close to it? I think that's possible. But I think again, it goes back to the macro uncertainty. I mean if you get better visibility and better clarity and confidence resumes at a higher level, I see no reason that we don't get back closer to sort of more normalized behavior if we end up in an all out trade war or something along those lines. And God forbid we head to a more softer and sort of recessionary type environment which, we are not seeing that at all. This isn't 9/11. This is not the great financial crisis. This is not obviously the global pandemic. But, assuming things sort of normalize or is close to normal then we're certainly well positioned well positioned whether we get back exactly this year. We are very bullish on Hawaii over the intermediate and long-term fee simple the barriers to entry. You can't replicate what we have. Obviously negative supply growth over the last 20 years. Obviously outperformance from a RevPAR standpoint versus other resorts over the last 20, the last 20 years. So it's where if you're going to Be over indexed from our standpoint. You want to be over indexed in Hawaii.

Okay, thank you. And then I just wanted to ask you. It looks like you took a $70 million impairment in the quarter. Can you just talk about what that was related to?

Yes. It's related to an asset, obviously, is our accounting. And as we've as our team is to look at what we think to be the true value of that subject asset. We made the decision that it was appropriate to write it down and have recognized that accordingly.

Okay. So you can't say which one, I guess.

Yes, not at this point.

Okay, alright. Thank you.

Thank you, Smedes.

The next question today is coming from Chris Woronka from Deutsche Bank. Your line is now live.

Hi Chris.

Hey Tom, good morning. So, just to circle back to the asset sales for a second. I think -- I think everybody is curious in terms of good outcome for pricing, what's kind of your -- Tom, what's your kind of definition of that? I assume it's kind of based on some kind of NOI or EBITDA and then maybe plus saves CapEx that might have been required. I mean I assume that's the right way to look at it and not some other metrics, be it per room or something. But any thoughts you have there would be great. Thanks.

Yes, it's a great question, Chris. I mean, first, look, it's -- the assets we're looking to sell are non-core. And so embedded in that, obviously, we're looking for attractive pricing, certainly at multiples greater than where we're trading. And obviously, we trade at a ridiculous multiples. So we're confident we can be selling at a higher multiple, that gives some price discovery for the market as well, saving also CapEx and then being able to reallocate that capital strategically back to our core portfolio and/or pay down debt and/or buy stock, where -- when and where it makes sense. Obviously, given the dislocation we've been active on all fronts, continuing to manage the balance sheet, continue to invest back in the portfolio as well as buying back stock. We're very confident as we start printing and showing certainly some of the transactions that are in the pipeline that they will be very attractive and they'll certainly be accretive from where we're currently trading.

Okay. That's great to hear, Tom. And then as a follow-up, I think Sean may have mentioned that your comparable OpEx kind of ex the noise last quarter was just up 1%. We know that several of your hotels had some labor resets late last year that would have pushed that number up. So where are you finding the offsets to savings? And can that continue and kind of implementing any kind of contingency plans with your operators? Thanks.

Yes, Chris, I'll take that. I mean, clearly, as we're going through those processes last year, I mean, the challenges to the teams should come in and budget and whatnot are to ultimately define savings and across the board, and so I think the teams have been successful in doing that. I mean I get -- I would say part of the play here, too, is to think through the mix. I mean lower occupancy, higher ADR certainly has helped with the flow through in the first quarter. And I think that's part of the -- what you see there. And so as you think through contingency planning, as we think in the future, I mean, clearly, we're doing those things with the operators. But in an environment where you might see some uncertainty, 90 days out, we're seeing outperformance in the near term. So it's definitely a tricky situation for the teams on the property to how to think about staffing as they try to react to that dynamic. But in the end, I think they're doing an incredible job of kind of staffing and being efficient, knowing that they've got the challenges coming off of some the labor contracts we renewed last year. I would say as we look forward to, we certainly expect to see some other offsets going forward on the fixed cost side, namely insurance, certainly is a positive market for the insurers going to market, and so we go to renew on June 1. We're confident we'll get a good outcome there. So I think that plays into how we think about maintaining the expenses and keeping it within reason. That said, I mean, in the end, you still have 4% to 5% wage growth, and so we're working to find the offsets where we can.

Chris, I also just want to say it's -- it's strong leadership from Sean, our asset management team, the men and women there who are partnering with our operators. It is also basic blocking and tackling and with a relentless focus on how do we mitigate and how do we manage around. Remember, if you think back through the pandemic and what we were faced with as dire situation as anybody in the sector and we got through it. We got through it as well as anybody given those facts and circumstances. So the team is experienced. There isn't anything we haven't seen. Those that sort of write and have comments that were a little more union focused and then our cost structure is always going to be higher, they're just wrong. And if they did a little bit of work, they've realized the discipline and talent within this team and you see how we continue to deliver and continue to work. So really proud of them, and -- we'll see even more of that when you start seeing the insurance when that turns around and what we print versus what our peers print.

Okay, very helpful. Thanks.

Really appreciate your comment and your question. Thank you.

Thank you. Your next question today is coming from Jay Kornreich from Wedbush Securities. Your line is now live.

Hi, thanks good morning. I wanted to first just drill down a little bit further in Orlando, which continues just to perform exceptionally well. And just curious if you can provide just further details as what's driving the strength there and how much of a positive tailwind to opening of Epic theme park in produce? And if there's any opportunity for Bonnet Creek complex to produce even more than the $90 million you forecasted?

Yes. We certainly expect that we will exceed the $90 million. It's just if you think about Orlando, People often think about Vegas that has about 45 million visitors. You've got 74 million visitors, plus or minus into Orlando. You have, obviously, Epic where Universal has put in $6 billion or more. I think as the publicly disclosed number, the excitement around that, the first park to open in decades. You've also got Disney coming on the heels talking about another $60 billion plus or minus. Now I'm not sure all that theme park that's going to be some shifts in, but with that kind of backdrop, and given it's a strong hub for convention as well, we are very, very bullish on Orlando. Bonnet Creek, in particular, now given the additional meeting space that we added at both the Waldorf as well as Signia, we have the ability to be able to layer in groups that we didn't have the ability before and then also having a championship golf course. And of course, being a Condé Nast winter last year, a top 10 performer. We're getting rave reviews and the on-site management team is just continues to do an exceptional job. So we are very, very bullish both near term and over the intermediate and long-term in Orlando. And certainly, again, if you look over the last 20 years and sort of RevPAR growth over the national average, there are several markets, obviously led by Hawaii, Key West, Orlando, Miami, all markets that Park is anchored and where Park has a great footprint. We would encourage investors and listeners to do a little bit more work on that front and see that, and you'll see that there's a I think, a real competitive advantage for Park as we look out.

I appreciate all that color. And then just one more follow-up, just going back to more of the macro landscape. And just given the uncertainty right now, are you seeing any change in behavior from your transient customers since April, whether I guess to be corporates pulling back on business travel or business transient travel or changes in leisure customers traveling to or spending a resource? Or are you really just not seeing much change at all at this point?

We were down 3% in March. Obviously, you've got the shift of Easter. We're -- we expect we're going to end April above the number. We have preliminary what we think the final numbers will be above the 1.6%. Obviously, New York, very strong, as I mentioned earlier, up 18%, Bonnet Creek, up 8%, Caribe up in mid-20s, Casa up another 14%, 15%. So we're not seeing -- this is -- this is not in a recessionary environment. There's certainly some caution. There are certainly pockets of softness. There's certainly a concern. We all share it. There's a lot of uncertainty right now. I think we'd all prefer that we get better visibility, but certainly despite that, and even the jobs report last week, things still are good. I would like to see some of that uncertainty and some of these trade deals if they're going to occur, the sooner the better because I think that, that will help, I think, provide more confidence as we all move forward.

Okay, thanks very much.

Thank you. Our next question today is coming from Robin Farley from UBS. Your line is now live.

Great. Thank you. My question was really kind of similar to the last question. In your intro remarks, you mentioned, I think you used the phrase modestly weaker transient. And then you talked about some of the challenges with group, maybe some tougher comps later in the year. I guess if you had to sort of rank where the strength or softness is between group and leisure transient and business transient, how would you sort of break down? I mean, it sounds like, obviously, there's a lot going on in the world and maybe they're all a little bit softer than you thought? Or I guess if you were ranking the three. Thanks.

Well, I just put on, Robin. On the group side, again, as I mentioned, the pace and the definites on the books and that holding, I think, is a strength. It's certainly providing that solid base for the business and that to be able to -- not to worry about that base as much as I think kind of gives it in this environment, kind of a top building for me. . From the leisure side, which you saw in April, I mean, ultimately, talked -- Tom talked a little bit about Hawaiian Village, but absent Hawaiian Village on the resort side, it's up, call it, 8% or so for the month, and this was a month where we came in and had dropped the forecast a little bit outperformed it by about 160 basis points. You're seeing a lot of -- it is almost like people are thinking through like, does it feel like a little bit like coming out of COVID where a lot of the drive to markets are benefiting in a lot of short-term transient and leisure side. So I kind of feel like leisure, to me to rank second right now on the possibilities as you think about the summer time frames transient in a lot of places, you might think are -- might be a challenge. But I think we're seeing plenty of markets that have leisure pace up in the summertime. So I put leisure second and think business transient, I think -- you think what's capturing that as government and some other elements that I think are certainly pressured, but I think business transient, corporate negotiated still shows a very narrow booking window, short term, but very solid performance so far.

Thanks. And just to clarify, April, of course, would have a strong April in a lot of the leisure markets with the benefit of Easter, is there anything when you sort of -- when you look out to kind of May and June, where there's not as much of a pronounced calendar shift, would you say that leisure still pacing up outside of the Easter shift?

Yes. I would say when I look at -- I think June is healthier than May right now, Robin? And so May, I think, is just kind of a month where I think we don't have to -- I think the group strength at this point. And so I think May is a little bit softer month for us in the quarter, softness in the quarter, and I think June is stronger with some group backdrop and things better leisure profile.

Okay, great. Thank you.

Thank you. Your next question is coming from Chris Darling from Green Street. Your line is now live.

Thanks, good morning. Tom, I wanted to go back to the discussion around capital allocation. Just curios, how you think about pursuing incremental share repurchases relative to perhaps bolstering your liquidity position? Obviously, a more certain economic outlook today and you think about some of the debt maturities coming due next year.

Yes. Chris, it's a great question. Sean and I spend a lot of time and the team really steady. I mean, obviously, we'd like to the extent possible take proceeds. And if we're buying back stock, we want to do it on a leverage-neutral basis, we clearly want to continue investing back into the core portfolio as we've talked about it and obviously continuing to manage carefully the balance sheet. I mean we've got over $1.2 billion in liquidity. Please keep in mind, obviously, the CMBS loan for Hilton Hawaiian Village matures in November, December of next year. We have a plan and we have optionality. Remember, during the pandemic, we did three bond deals. We pushed out maturities. We paid off all the banks, all the banks made fees. We have great banking relationships. We're not reliant on the banks and we are carefully studying it. And you'll see significant progress made on that maturity this year, and we're confident that we'll get it addressed. So no fear or concern from that standpoint. Having said that, when you're trading at this kind of pricing, we certainly think buying back stock at these levels is certainly among the best investment decisions that we can make and buying back into this core portfolio at this kind of pricing. So it's a balancing act. I think we've demonstrated it, and we'll be careful and thoughtful about it. And I think we've demonstrated that over time.

That makes sense. Appreciate the thought. Thank you.

All right. Thank you.

Our next question is coming from Dany Asad from Bank of America. Your line is now live.

Hi, good morning everybody. So maybe one more question on leisure if you don't mind. Are you seeing any different patterns of behavior from your consumers staying at your higher-end properties relative to non-luxury resorts?

Not in particular, Dany. I mean, clearly, you certainly see better pricing out of the luxury side. You're certainly seeing places like Hawaiian Village, where we're opening up channels to obviously drive more volume there to guys were trying to recover, which is attracting a little more of a discount leisure. But I think outside of that, I don't think the patterns have really changed much and the behavior.

Okay. And then one more, just your non-rooms revenue grew about 200 basis points ahead of RevPAR for the quarter. Was there anything unique to Q1 that would drive this? And just how should we think about RevPAR versus out-of-room spend for the balance of the year with the updated outlook?

Yes. We had some strong group catering contribution, up 9% in Q1. I think as we think about the contribution to overall RevPAR about -- I'd say about 500 to 100 basis points added to RevPAR. As you think -- as we discussed, group pace a little bit weaker as we go into Q3. So I think what's driving overall for the year though, and a little bit of strength, certainly in Q1 is just the mix between in-house -- kind of corporate in-house and convention has shifted more in the favor of in-house group this year. So you're just going to get better -- better F&B production on the catering side. Obviously, with convention business, you're just probably mostly getting room blocks off of that, and they're eating elsewhere. So I think that's kind of a dramatic -- more of a significant shift for us this year.

Thank you. We reached the end of our question-and-answer session. I'd like to turn the floor back over for any further or closing comments.

We really appreciate everybody taking time today, and we look forward to seeing you all at upcoming conferences.