Colin Reed - Chairman & CEO Mark Fioravanti - President & CFO Patrick Chaffin - SVP, Asset Management Scott Lynn - SVP & General Counsel.

Chris Woronka - Deutsche Bank Shaun Kelley - Bank of America Bill Crow - Raymond James Smedes Rose - Citi Harry Curtis - Nomura.

Welcome to Ryman Hospitality Properties' Fourth Quarter 2015 Earnings Conference Call. Hosting the call today from Ryman Hospitality Properties are Mr. Colin Reed, Chairman and Chief Executive Officer; Mr. Mark Fioravanti, President and Chief Financial Officer; Mr. Patrick Chaffin, Senior Vice President of Asset Management; and Mr.

Scott Lynn, Senior Vice President and General Counsel. This call will be available for digital replay. The number is (800) 585-8367 and the conference ID number is 33745746. At this time, all participants have been placed on listen-only mode. It is now my pleasure to turn the floor over to Mr. Scott Lynn. Sir, you may begin..

Good morning. Thank you for joining us today. This call may contain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995, including statements about the company's expected financial performance. Any statements we make today that are not statements of historical fact may be deemed forward-looking statements.

Words such as believes, or expects are intended to identify these statements, which may be affected by many factors, including those listed in the company's SEC filings and in today's release. The company's actual results may differ materially from the results we discuss or project today.

We will not publicly update any forward-looking statements, whether as a result of new information, future events, or any other reason. We'll also discuss non-GAAP financial measures today. We reconcile each non-GAAP measure to the most comparable GAAP measure in an exhibit to today's release.

I will now turn the call over to the company's Chief Executive Officer and Chairman, Colin Reed..

Thanks everyone for joining us on the call today. I will begin my remarks by briefly touching on our results for the fourth quarter and the year. And then, I want to express some thoughts on how we see the current environment as a precursor to our outlook for '16 and beyond. And then, I will pass it off to Mark to discuss the financials.

As you all aware, we previously shared our key operating metrics for the fourth quarter and year about five weeks ago when we announced our expansion plans for the Gaylord Texan which I will talk about in a couple of minutes.

We felt that it was important to give you all our investors and the analyst community insights into how our business was performing in light of all the volatility in the broad market as well as some gloomy rhetoric that we were hearing from a small segment of our REIT hospitality peers.

But as a way of reminder, our fourth quarter results capped off an excellent 2015 in fact it was a record year on many fronts. Now let me quickly run through some of the highlights. In the fourth quarter of '15, we delivered the best single quarter forward group sales production in the company's history booking approximately 977,000 gross room nights.

Gross bookings for the full-year for 2015 came in at roughly 2.337 million room nights making it the best production year in the company's history. RevPAR for the fourth quarter was up 9.1% and total RevPAR was up 5.7%. Just to remind everyone RevPAR in '14 was up 10.3%. So we had a pretty tough quarter year-over-year.

Now after our last earnings call there was some skepticism from a few folks about our ability to hit these levels of RevPAR and total RevPAR in the fourth quarter. As you can see, our hotels performed as we had outlined and I'm proud of this. For the year, RevPAR was up 3.7% and total RevPAR was up 5.7%.

In terms of profitability, we saw double-digit percentage adjusted EBITDA growth in the fourth quarter as well as for the year with of course very healthy increases in margins. So the headline is our company posted a record year in terms of sales production, revenue, and profitability.

Now I would like to take a step or two back and give you all a sense of how we are seeing the world particularly in the light of the current environment. So I'm going to briefly discuss three factors that combine cause us to be very excited about the next few years.

The competitive landscape in where our hotel business sits within, the larger macroeconomic and corporate environment we are seeing coupled with the future business we already have on the books and three, the level of operational control and margin management we've been able to implement in our business over the past three years.

So turning to the current competitive landscape. For the last several years, there has been a general sense that the hospitality focused REITs as a whole have been performing pretty decently from a RevPAR growth standpoint and we've been part of that function as well.

However when everyone is being pushed along by the same tailwinds, it can be hard to differentiate who is doing the right things well and who is simply benefiting from the overall updraft in the sector. Now as we've seen over the past couple of months, volatility has certainly taken hold in the broad market including hospitality.

For some folks out there particularly those companies who focus on the non-group sector times like these make it difficult to see what the future may hold. What you will hear is that it's anybody's guess? And where we will be in six months as to where we will be in six months much less where we will be in 12 months.

Now for us we see things a little differently. All of this uncertainty and volatility is why I appreciate and value the group centric hotel business model we have built over the past 15 years and why our long-term more savvy shareholders value it as well.

What we are starting to see this quarter has been some softening around certain edges of the economy which is particularly relevant as overbuilding in some destination markets like New York or the impact of Airbnb supply in places like San Francisco have led to the beginning of some softening in these cities from a hospitality perspective.

This has made it harder for some of our more transient focused competitors to accurately forecast their performances and really differentiates themselves as their business either sail along or hit road bumps among these border trends. Our business is strategically very different.

Our profit is a unique purpose build assets located in markets that suit our group focused model. Our model gives us more visibility than our competitors and allows us to effectively allocate capital to make strategic long-term investments when needed.

While occupancy levels have steadily increased across the nation over the recent years, the supply side of the equation when it comes to large group focused segment we cater to is not increased proportionately. We are seeing very little new competitive supply under construction on the scale to accommodate large groups.

For us, this is an opportunity to build on our competitive advantage by strategically investing in our existing hotels to ensure we can continue to meet the demands in the markets for our hotel assets.

Now this was the approach behind our announcement last month that we will be investing $120 million to add 300 guest rooms and 86,000 square feet of meeting space of the Gaylord Texan which will make this resort the second largest non-gaming meeting focused hotel in the U.S.

as measured by total self-contained exhibit and meeting space and guess what the number one of course is Gaylord Opryland. Now we see this type of initiative as clearly beneficial and prudent use of capital that will yield significant returns on investment for our business and our shareholders over the long-term.

And we will continue to look at these types of opportunities moving forward. Another encouraging sign is that according to a recent industry research as reported by Smith Travel, there has been strong positive momentum in terms of demand within the 1,000 plus group segment.

This is a demographic that very few other companies can cater to and we believe we understand and accommodate better than anyone. To borrow a concept from one of the great investors of all time, Warren Buffett, we believe we built an economic mode in the group sector of the hospitality industry.

And bottom-line it can't just decide to play in this space and suddenly be a real competitive threat in one to two years, but sufficed to say that Airbnb is not keeping this REIT up at night. Now the other unique element of that model is how we can leverage the transient side.

Now while we are not dependent on leisure guest to the same extent as a lot of our competitors are, we certainly count on it to augment our core business, particularly as the Marriott Awards program continues to provide us the type of delivery system we just didn't have prior to our conversion to a Real Estate Investment Trust.

Our hotels are unique destinations with fun and exciting entertainment offerings, supplemented by successful programming around certain times of the year such as the holidays. And we are confident that this will remain a unique competitive position and a positive driver for us moving forward.

And hopefully most of you who will be at our Investor Meeting in a couple of weeks in Nashville hopefully when you are all here, you will be able to sample firsthand what I'm talking about. Now, point two, how we are seeing the economy and the business we have on the books looking forward.

While the economy may not be currently growing at levels we would all like, the reality is it's not all doom and gloom either, putting the energy oil sector aside, Corporate America seems to be in relative decent shape, Corporate balance sheets are in much better shape than they were in '08, while Corporate profits may have moderated a bit of late, there is still economic growth occurring.

Now what this means for our business is companies and organizations are meeting. This was evidenced by the fact that in both '14 and '15 were record years from a group bookings perspective. And as of the end of the first quarter, we had about 1.5 million net room nights on the books to '16.

In addition our lead volumes and funnel of tentative and prospects remains strong. At the end of '15, we had 49% net occupancy on the books for '16 and I doubt any of the companies you compare us to will come anywhere close to that. Now we are certainly not immune to the macro world altering economic events such as what we witnessed in '09.

But what I would tell you is that based on the level of visibility we have on the books and the protection our model affords us we have better position in virtually anyone else in our sector to weather the storms that will come our way.

Now my third point the operating leverage and profitability that we have been able to generate from this business in '15 as well as how we're thinking about that these margins moving forward to '16.

We've spent the last two to three years working collaboratively with our manager to really assess how to drive optimal profitability and margin management in this business. What we are seeing currently is the result of these efforts and we now feel like we have momentum in this element of the model.

You can see the evidence in our profitability results particularly with the growth in adjusted EBITDA which was up nearly 10% for '15 compared to '14 on a same-store basis and margins north of 30% which is an increase of 170 basis points. Now I want to amplify this a little further.

If you look at the same-store hospitality segment flow through of incremental revenue to incremental adjusted EBITDA from '14 to '15 you would see that it was quite remarkable in fact it was over 80%.

Now while this level of flow through is not sustainable over the long-term, we target our hotels to run in the 50 percentage point range which is very, very healthy. Now I want to take a second and give you an update on our entertainment business.

This business has had a strong year posting double-digit increases in revenue and adjusted EBITDA compared to '14. As I've been saying for some time people all across the world are discovering the product of Nashville and our entertainment assets are a large part of this popularity.

We continue to explore a number of pathways and options aimed at allowing us to capitalize on the growth of this business and we have a number of exciting opportunities we're working on and it's our intention to share with you what we've been up to when we hold our Investor Day that I referenced just a minute or so ago.

We're excited about this business and believe will create lot of value for our shareholders. Now I will let Mark talk a little bit about the capital markets in greater detail.

But I want to note that as of the close of the market yesterday we repurchased approximately $23 million worth of our shares during the first quarter of this year under the $100 million share purchase authorization we put in place this past August.

As you have heard on the call today, we believe our business is very well-positioned and view share repurchases at this stage as a very prudent use of capital. Over the past several years, we've been a net purchaser of our equity, which we believe has been in the best interest of our shareholders.

Going forward, we will continue to monitor and market and balance additional share repurchases against other opportunities we have to deploy capital to drive long-term shareholder value.

Now in addition to the share repurchases, we've also this morning announced that our Board has approved a $0.05 increase to our quarterly dividend to $0.75 per share or an increase of over 7% over the fourth quarter of '15.

We plan to pay a total in '16 of an annual dividend of $3 per common share representing an 11% increase on an annualized basis over '15. This increase is truly indicative of the health of that business and how we're thinking about the future. Now let's talk about guidance for a minute.

As we look through '16, it too is projected to be another record year for our company and one that will be a differentiator for us. As we have discussed over the past year, our group pacing heading into '16 has been tracking very well for some time.

This pacing and booking activity for '16 over the past several years has really positioned us well for a successful year. As such, we anticipate RevPAR growth to be 3.5% to 6% versus 2015. Now you may ask why a 2.5% spread between the bottom and the top end of the guidance.

Historically we have always had about a 2% spread and the simple answer is the economic uncertainty that we read about almost hourly, the economic uncertainty that is going on right across the planet. As I mentioned earlier we believe that the group business is the segment to be in currently.

There are a number of indicators that we use to assess the health of group trends going forward. First, group bookings performance improved through '15 as evidenced by our sales production that I discussed earlier. Furthermore at the year-end, our prospects and tentatives combined were up 24% year-over-year.

Assuming these trends continue, which I will let you know they have through the end of January, we expect '17 and '18 to be very solid years for our business. We believe the transient segment will remain healthy barring any unexpected macroeconomic or geopolitical issues.

Our strong base of business already on the books coupled with favorable supply dynamics in the markets in which we operate should allow for improved yielding power, both transient and in the year for the year group bookings.

Now turning to total RevPAR, we are also guiding 3.5% to 6% over '15 which is being driven primarily by growth in the number of corporate room nights we already have on the books. In developing our total RevPAR guidance, we very clearly examine the contracted outside of the room spending for each of these groups for 2016.

Now Mark will provide more details on the guidance in one minute. And so to wrap up, we are delighted on how '15 went but again, our real excitement comes from where we see this Company going in '16 and beyond.

We are confident that we have the right model, the right strategy and the right team in place to truly capitalize on the current environment and continue to evolve a business that delivers significant value for our shareholders every day.

Mark?.

Thank you, Colin. Good morning, everyone. Thanks for joining the call. In the fourth quarter, the company generated total revenue of $312.1 million, up 7% from the prior year quarter. For the full-year 2015, total revenue increased 4.9% to nearly $1.1 billion.

During the quarter, the company generated net income available to common shareholders of $38.9 million or $0.75 per fully diluted share.

Net income in the quarter includes an impairment charge of $16.3 million which are costs associated with the company's decision to move forward with an expansion of guest rooms and meeting space at the Gaylord Texan.

As outlined in our announcement in January, our current expansion plans replace a previous plan that was conceived prior to 2008 and has been subsequently put on hold. This non-cash charge is the write-off of accrued development expenses with respect to the previous project and does not impact adjusted EBITDA or AFFO metrics.

The company continued to grow profitability in the quarter generating $88.3 million in adjusted EBITDA, improving EBITDA margin by 170 basis points. For the full-year, the company's adjusted EBITDA margin increased 180 basis points generating $325.1 million in adjusted EBITDA, a nearly $34 million increase over 2014.

For the quarter, the company generated $80.7 million in AFFO or $1.56 per fully diluted share. For the full-year, the company generated $273.7 million in AFFO or $5.30 per fully diluted share.

Turning to the hospitality segment results, the hotels finished the quarter on a same-store basis with a RevPAR increase of 9.1% and an increase in total RevPAR of 5.7%. We finished the year strong with full-year RevPAR and total RevPAR on a same-store basis within our guidance range increasing 3.7% and 3.5% respectively.

While we saw an increase in attrition during the quarter of 120 basis points to 12.7% versus the fourth quarter of 2014, sequentially attrition was 100 basis points lower than in the third quarter.

As we parse through the groups that did experience attrition during the quarter, there were no discernible patterns or trends that would give us cause for concern. In fact in the year for the year cancellations during the quarter declined 66.2% to 2400 group room nights.

Attrition and cancellation fees collected during the quarter totaled $2 million and full-year fees totaled $6.9 million. We continued to see solid operating performance and margin expansion in our hotels during the quarter driving a 12.2% increase in hospitality adjusted EBITDA to $87.4 million.

Adjusted EBITDA margin increased 150 basis points to 30.4%. Full-year hospitality adjusted EBITDA increased 10.4% to $315.5 million representing 170 basis point margin improvement. Our entertainment business continues to have a strong year.

During the fourth quarter, the entertainment segment revenue increased 13.7% to $24.6 million and the segment's fourth-quarter adjusted EBITDA was flat at $6.2 million. These results include $1.3 million of costs related to our ongoing work with strategic consultants and other advisors.

Absent these costs, the entertainment segment would have shown an increase of 20.2% in adjusted EBITDA for the quarter. For the full-year, revenue increased 12.3% to $97.5 million while adjusted EBITDA increased 11.8% to $30.8 million. Corporate and other adjusted EBITDA totaled a loss of $5.3 million in the fourth quarter.

Full-year corporate and other adjusted EBITDA totaled a loss of $21.2 million compared to a loss of $22.3 million last year. Moving on to the balance sheet, as of December 31, we had total debt of approximately $1.43 billion and unrestricted cash of $56.3 million.

Net debt outstanding was $1.38 billion including $700.4 million of borrowings drawn under the company's credit facility leaving $393.6 million of availability under that facility. In August, our Board of Directors authorized $100 million share repurchase program which extends until December 31, 2016.

Subsequent to the end of the quarter, the company repurchased and canceled approximately 499,000 shares of its common stock at an average price of $45.89 per share for an aggregate purchase price of approximately $22.9 million which was funded using cash on hand and borrowings under our revolver.

As I mentioned last quarter, we will remain disciplined in our approach to these repurchases and weigh the potential returns of repurchasing additional shares against returns of other uses of capital such as EBITDA enhancing capital projects or increases to our dividend.

Now turning to guidance as Colin mentioned, we anticipate hospitality RevPAR and total RevPAR growth of 3.5% to 6% for 2016. This range reflects our confidence in the group trends we see and anticipate for the year but also considers the global economic uncertainty in the current environment.

Also included is the impact of the continued room renovation work at Gaylord Opryland which we believe will result in approximately 34,100 room nights out of service for 2016. As with past room renovation projects, the out-of-service rooms do not impact total available room count for calculating hotel metrics.

Also for comparability purposes, we have not included the 192 AC Hotel in our hospitality RevPAR and total RevPAR guidance because it did not open until April of 2015.

We are providing full-year 2016 adjusted EBITDA guidance for the hospitality segment of $328 million to $338 million and anticipate adjusted EBITDA margin will improve by 30 to 50 basis points. We anticipate the AC Hotel adjusted EBITDA range to be between $3 million and $4 million this year.

And our 2016 adjusted EBITDA guidance for the entertainment segment is $31 million to $35 million. This entertainment segment guidance includes approximately $2 million in additional operating resources we are investing in the future growth of this business.

Our corporate and other guidance for adjusted EBITDA in 2016 is a loss of $21 million to $23 million. On a consolidated basis, the company will generate adjusted EBITDA of $339 million to $356 million and AFFO of $268.6 million to $289 million or $5.24 to $5.63 of AFFO per fully diluted share.

For 2016, we are refining our definition of AFFO to exclude the impact of deferred tax expense which is non-cash in nature. We recognize that our tax expense line has some volatility which is primarily due to changes in our deferred tax assets and liabilities and related valuation allowances.

Unlike many of our hospitality REIT peers, we are unique in that we converted from a C-Corp and operate a meaningful taxable REIT subsidiary which houses our entertainment business. Most of our deferred tax assets and liabilities are holdovers from our C-Corp days including from our entertainment businesses.

Recognizing that most analysts and investors use AFFO as a way to measure a REIT's cash flow generated by its operations and that meaningful non-cash items can unnecessarily impact this analysis, as such, we believe it's appropriate to exclude the impact of these non-cash items whether positive or negative, from our AFFO definition.

While we don't provide quarterly guidance, I would note for modeling purposes based on our year-to-date performance current on the book's room nights and rest of year expectations, the second and third quarters are projected to show the strongest year-over-year growth in both revenue and adjusted EBITDA.

Our first quarter results include the negative impact of the Easter holiday shift and winter storm Jonas that hit parts of the Eastern Seaboard during late January. When considering these events, we anticipate first quarter RevPAR will be flat to down modestly and total RevPAR will be up low-single-digits compared to last year.

Given the strength of the fourth quarter last year, we anticipate our fourth-quarter performance this year will be flat to up modestly to the fourth quarter of 2015. A detailed reconciliation of our current guidance from net income to adjusted EBITDA, FFO, and AFFO, can be found in the supplement to our schedule in our earnings release.

In closing, I want to remind everyone about our upcoming Investor Day on March 9 and 10 and we look forward to hosting this event in Nashville and spending time with a number of you in person.

For those of you who are able to make it for dinner on March 9, we have planned a special evening on the stage of the Grand Ole Opry which will include entertainment from some of Nashville's top singer, songwriters. It should make for a special evening and one that is uniquely Nashville.

And with that, I will turn it over to Colin for any closing remarks..

I am going to punt on the closing remarks, Mark, and ask Jackie, if she could open up the lines for questions as it is Friday..

[Operator Instructions]. Our first question comes from the line of Chris Woronka with Deutsche Bank..

Hey, good morning, guys.

Was hoping we could talk a little bit about how the -- I guess maybe the composition of the group's changes as we move through the cycle and is it a little bit more association heavy? And also I want to kind of get a sense on the corporate groups how far they typically book out and whether you have seen any changes there or not and kind of how maybe the pricing differential? Sorry for the multiple questions..

Yes, that is fine. Chris, good morning, Colin. So let me just start by giving you sort of a philosophical belief that I have that comes from decades in this business. We love the association business.

There are folks that would argue that when the economy is red-hot you should punt the association businesses -- business and shift across too much more heavily weighted with corporate.

But the good thing about this association business, it typically books four-and-a-half years out and it tends to come irrespective of the economic health of the country.

And just to remind you back in 2009 when the world went off a cliff, we canceled I think it was about 125,000 group room nights of which in '09 of which about 120,000ish were corporate and the association business just sailed through that period. So we like it.

In tends to represent if you look at our company, 75% of our business there or thereabouts is group and 75% of that is large group and out of the 75% of total group actually we are about 30% association. So that is how we are made up right now. We are seeing a lot of activity in the corporate sector.

We booked disproportionately more corporate business than we have had in previous years for '16 and you want to share some of the details of that, Pat?.

Sure. Good morning, Chris. It is Patrick. It is good to hear from you. Just to give you some insight as Colin was mentioning for 2016, we do have more corporate room nights on the books currently for 2016. We are up about 62,000 at the same time last year. Association is down a little bit just because we have been taking more corporate intentionally.

But to Colin's point as we look out into the future years, we continue to take association on as a good firm foundation for our future years.

So association is down about 45,000 room nights for 2016 and our SMERF-y groups, which are the social, military, education, religious and fraternal groups, are slightly up for 2016 as we are working to make sure we have our need dates covered..

That's great. Appreciate the color there. And then a question on the entertainment business and look forward to learning more about that next month. I know you guys have been looking at various kind of longer-term alternatives.

Do you have any -- directionally do you have any clue as to any changes you might want to make or anything? Also just a view on the timing of do you have a set time when you say we want to be here or there or do this or that?.

Well, no, so philosophically the business, philosophically the business the way we think about it probably should not be in hotel real estate investment trust. It is very different and there is no equivocation as far as that is concerned.

The thing that we have been doing over this last year is we have literally been bombarded by organizations coming at us that would like to partner with us and do things as it relates to the entertainment business.

So what we've done is we've gone through this period of evaluation last year where we had some pricey consultants in helping us think about content, distribution, content creation and then how to leverage the brands that we own on a domestic and may be global basis.

And we have a very clear now understanding of what we think the potential is and we will explain that to the investment community that turn up in a couple of weeks.

The timing of when we ultimately spin this business will be determined by the speed at which we are able to execute the strategy because when you do it as you well know, Chris, when you -- if you spin a business, you have got to be able to clearly demonstrate to the investment community the sex and sizzle that will come with this business.

And so demonstrating the growth is going to be a very important ingredient to determine when. So lots of exciting things we are doing.

We are going to explain that but we're not going to say 30th of September of 1st of January, we're going to say to you all here is what we're doing and as we cross certain thresholds then we can be ready to bring this business to prime time..

Okay, very good insights. Thanks, Colin..

Pleasure. Look forward to you coming.

You are coming, aren't you, Chris?.

Yes..

Excellent. Look forward to seeing you..

Our next question comes from the line of Shaun Kelley with Bank of America..

Hey, good afternoon. I guess morning there in Nashville so good morning, everyone. So, Colin, I just wanted to touch on -- I mean there is a lot of sensitivity out there about Texas and I think you guys have given plenty of transparency about what's in or not in your kind of in your books.

But can you just remind us sort of oil and gas exposure as it relates to some of the more energy related accounts at the Texan and what kind of exposure you think that might make up of that property specifically just given all of the noise around what's going on in Houston these days?.

Yes, sure. We've -- I think we've covered this question I don't know how many times and we are happy to give you a real-time update but the simple answer is that we see very, very little oil and gas business at the Texan. And you want to get into the detail, Pat, just for a second..

Sure. Shaun, it represents less than 3% of the group business that we would see in a given year and we actually looked at '16 and '17 and it is an even smaller fraction than that for the next 24 months.

I think in '16, we had less than 5000 rooms on the books for any type, not just specifically oil and gas but any type of related industry that might depend on oil and gas. So we scrubbed the books. We are very confident that we really just don't have a whole lot of exposure there..

Great. That's helpful and I'm sorry to make you guys beat the dead horse on it but when people run.

We understand it is top of mind. I mean, we read the perils of oil and gas, we read about it every hour every day and so it's not unusual that you ask the question but..

Always I appreciate you humoring it. And then the second question would just be on -- and don't know what detail you can give or not but it does sound like the project in Aurora is moving forward under a different development or different developer than obviously you guys.

I'm curious like down the road as a strategic option for you guys, how would you think about an acquisition of something that's sort of a purpose built property like that especially given that it's something that you guys would know quite well?.

That is a good one and so let me come at this from two angles. You have raised the spectrum of Aurora. Let me quickly talk about Aurora and then the more broader question about acquiring more purpose built large group resort assets like what Aurora will be probably in about three years from now. So first of all, Aurora, we love that location.

We put four or five years of -- three, four years of energy into that location. We simply believe that being part of the Gaylord family, that hotel will pick up a lot of customers from the West Coast, bring those customers to a world-class hotel and rotate those customers into the rest of the Gaylord brand. We love that whole notion.

We think that the economics of that hotel because of its relative competitive positioning in that market will be tremendous because there is not a convention hotel like that anywhere within a 250 to 400 miles of that market. So we love Aurora and under the right circumstances we would consider investment in that business.

What we have said is that we are not going to be in the construction business of a large hotel and take the debt 100% on our balance sheet over a two, three-year period. But we love that hotel.

Second, if a large quality group hotel in a quality group market would shake loose and come at a price that we believe one, we can influence the profitability on the hotel and the price would generate a good return on capital for us, we of course would look at it.

We have been accused by may be a handful of folks of being nonaggressive on the real estate purchasing side over the last three, four years. The problem with us is that our standards are too damn high. We only look at assets that we think are complementary to the world-class assets we own.

And we do not want to be homogenous like every other REIT and hospitality REIT in this country. We're going to stick to the part of the business that we truly understand. So that's where we are at on that..

Our next question comes from the line of Bill Crow with Raymond James..

Hey, good morning, guys. Colin, I had the same question about our Aurora. Let me phrase it a little differently.

Does it pose a risk to your business in that you will likely lose some rotational business out of your properties and into that one? How do you deal with kind of the reputational risk that comes when somebody else is owning an asset with that brand on it?.

Well, I don't think there is a REIT in this country that holds any brand captive, right. I mean there's no hospitality company -- hotel real estate company owns 100% of any brand period unless of course it is a one-off hotel sitting in San Francisco. But, Bill, here is the thing.

Last year I think we booked out of the 2.3 million room nights, about 1 million room nights of those room nights or thereabouts, 900,000 and something room nights were multiyear, multi-location room nights.

We have pioneered this strategy in this country and in fact it is interesting because Marriott has been adopting the strategy of picking a customer up and rotating those customers three, four, five years through the system and keeping them within the system.

So these customers, their behavior is such that they will rotate from market to market year-by-year and we have customers that we book every single week every single month for a piece of business next year but the year after they are either in Las Vegas or they are in San Antonio or they are in San Diego, they rotate.

So but what this business will do, it will give us the opportunity just like when we opened Washington, it will give us the opportunity of introducing consumers who to-date are not using the Gaylord brand into that Gaylord brand and pick them up and rotate them into our business.

And yes, there will be customers that will rotate into that business but on a net-net basis just as when we opened Washington, this was net additive to the system. It was powerful for the system.

So we are looking forward to the Colorado hotel happening and we look forward to working with that ownership group and at some point in time, we may find that we will have an involvement in that business and when that occurs, we will of course let you know..

That's helpful. Yes..

One thing I would mention is that when we sold the brand to Marriott, obviously we wrote the brand standards for the hotels and until the brand grows to a certain -- as long as we control at least 50% of the rooms in the Gaylord brand, we have the ability to approve or change the brand standards.

So we are comfortable that we have some control over how this brand looks and feels outside of our asset..

That's helpful. Thanks Mark.

My final question is -- and you mentioned Washington DC in your answer, Colin -- any -- is it too early now to determine what the inaugural impact will be next year to your properties?.

We know that there is a spike; we know that we invariably run a lot of parties through that hotel because that hotel is one of the largest in the region. I thought you were going to talk about the impacts on the hotel from the casino from MGM's casino that is slated to --.

You can go there too as well, Colin, if you would like..

No, no, that's okay. But we're excited about the fact that the hotel product that we have in National Harbor will be by far the nearest hotel to that MGM casino which is going to be I think a beautiful casino and it's going to be a game changer for Maryland and for Pennsylvania and that is going to be all very good and we are looking forward to that.

And the inauguration is going to be four or five days of parties that it's sort of like a muted Super Bowl. We've had what two inaugurations, three inaugurations now in that hotel in that hotel's history too I think. And it's been positive. But you know, Bill, it's not going to transform the results for that hotel.

What is I think is the leisure business that we are going to see from this casino..

Okay, great. I look forward to seeing you in a couple of weeks. Thanks..

Look forward too..

Our next question comes from the line of Smedes Rose with Citi..

Well, hi, thanks for taking my call. I wanted to ask you, Colin, it sounds like you're -- obviously your asset in Nashville is uniquely positioned but you did mention supply in other cities causing some weakness. And when you look at rooms under construction and in planning in Nashville, it's about 25% of current inventory.

Is there some level that would give you any kind of worry about the supply in Nashville or do you just feel like the city is growing so rapidly that all of that poses no threat to you?.

Yes, thanks. Good question. You are right, 2,500, may be another 1,000. Here is the thing, the city Nashville basically within the downtown city has run out of real estate. The last piece of real estate an acre and half that got sold a couple of month's back, an acre and a half for $20 million for a hotel to be built on it.

So what is going on here is frankly very different than what you see going on anywhere else in the United States of America. The millennials have discovered country music; country music is the fastest-growing genre in the United States, because of technology, because of iPhones, iPads, the national TV show.

And so when you come to this town today versus five years ago and you see it, you see what is going on here, it is just being bombarded by people who want to come and party and have fun in this town.

So this supply is being built to accommodate the extraordinary increase in prices that you're seeing in downtown hotels and to fulfill and to accommodate this demand.

When you've got Hampton Inns charging $325 on a Friday night, Saturday night in downtown Nashville compared to what it was two, three years ago; it's quite extraordinary what is going on here. But our business, look, we had the very best year last year. We also had I think a tremendous booking year last year for Opryland going forward.

And we don't see any slow up and Opryland. Opryland last year made just $110 million of EBITDA. Four years ago, Opryland was in the 70s. It is quite extraordinary what is going on in Nashville and we don't see any slowing up.

The issue that the town has to deal with is the issue of transportation and just like what happened in Vegas in the '90s when all of the new supply came to fulfill the incredible demand from consumers that were flying into Vegas from all across America, the city got choked and we've got to figure out in this town how we move people around.

But it is very exciting what is going on in Nashville..

Okay, thanks. If I could ask just one more, you mentioned that you have about 49% occupancy on the books for this year. I think that was up from about 46.5% in the third quarter.

Is that typically where you stand at the beginning of a year like more or less 50% full and then you would layer on the other 25 points or so over the course of the year or does it just vary so much?.

Normally -- it normally historically, it has sort of been in that 46% to 50% range. And I will tell you this that the amount of room nights we have on the books is as good as we have ever had and the quality of those room nights are as good as we have ever had. It is up over last year, up over the year before.

And the thing about it that we really like is the fact that we have got all of this business on the books but when we look at the ts and ps, the tentatives and the prospects and we look at our lead volumes, our lead volumes are up in the 20%, 25% range over this time last year.

So we are seeing a lot of business and as we are tracking our leisure business literally week by week, we see that our leisure volumes are good and our rate on leisure is good as well. So yes, we like to be at about 49% to 50% and -- but in prior years, somewhere in the 46% to 50%..

All right, thank you very much..

See you in two, three weeks at your conference in Florida..

That's right..

Look forward to it..

Thank you..

Our final question comes from the line of Harry Curtis with Nomura..

Hi, good morning. Just wanted to go back to the question that you almost half answered from Bill. When you look ahead into 2017, I am interested in your initial expectations for the either positive or the competitive impact of MGM on your demand in DC.

Is there any information or data you can give us on forward bookings? Are you seeing any competitive impact or is it having -- is it sort of accretive to your business at this point?.

Look, Harry, you have been a student of the casino business for a long time, right. And the facility that MGM is building is about 350 room hotel and it will do 10,000 cars a day in this market. It's going to be all of the people have written about this business $700 million to $800 million of net win. You understand what all that means.

That is a ton of transient business. But the thing about it is transients don't book a year ahead. Transients will make the decision in October that they are going in November.

And so we haven't seen any at this stage lift from the MGM facility nor would we expect to simply because the MGM facility is not -- it doesn't have 150,000 square feet of meeting space and they can't accommodate meetings that they are booking. They have basically no meeting space.

So I cannot imagine that this business will be anything other than accretive to us when this hotel gets to opening. And quite frankly, I think National Harbor is positioned fantastically well to capture a large part of the consumers that will come to that facility..

And Harry, just to build on that point to accentuate what Colin said just to give you a little additional information outlook to 2017 and the room nights on the books from a group perspective are definitely consistent with what we've seen in years past for that looking that far out.

So it is tracking from a group perspective and again, we don't really see this is a competitive threat from a group perspective but as an additive component on the transient side..

Just a quick follow-up and that will do it for me.

The typical mix of your transient customers at National Harbor is what?.

It runs lower than our other hotels.

It's in the 15% to 20% range just because the National Harbor development continues to work to get the notoriety and awareness in the region there which we -- to Colin's point earlier, which is why we are excited about MGM because it will bring a much higher level of awareness, notoriety, and cachet for that development.

So 15% to 20% is where it normally hovers..

Just a physical question, how close is it to your facility?.

Half a mile. But it is in the complex, it is on the far northwestern side of the complex nearest the interstate which is where it should be. But Harry, here is the thing. If you come out of that facility and you decide you want to go further northwest towards downtown, I think that is the geographic way, you have probably got seven miles.

And then if you say okay, I don't want to stay at National Harbor, where do I stay? The nearest other hotels is back across the bridge over in Alexandria where the rate is materially different.

Or you go East I would think it's East, probably East, Southeast into Prince Georges County and there is just not a lot of quality hotels until you get to Baltimore I would suppose.

So we are perfectly located to accommodate the overnight player who wants to come in with the wife, the girlfriend, the boyfriend, whatever it may be, have dinner, play cards, play slots, stay over, have a few beverages, we are a perfect location and the fact of the matter is we have some of the finest suites on the East Coast of the United States in that hotel..

That's helpful. And thanks very much..

See you at your conference, Harry. I think we are scheduled for the Nomura conference this year as well..

I'm looking forward to it. Thank you..

Thanks. All right. I think, Jackie, then we are done.

Right?.

Correct. There are no further questions at this time..

All right. Well let me just finish by saying we look forward to seeing everybody at our Investor Day and more to follow. Thank you very much everyone for joining us..

Thank you. This concludes today's conference call. You may now disconnect..