Anthony Powell: Yes, thanks. And maybe on the conversion in Boston to the independent hotel and the acquisition of the impendent hotel in Montana, you’ve gone much more heavily independent in your kind of branding and your acquisitions in recent years. Maybe comment on why you’re doing that? And are you seeing the value of some of these brands kind of decline? Or are these more special situations in your view?
Mark Brugger: Yes. I think the brands are still valuable and most of our hotels still have brands on them. But we look at each hotel as its individual case and the brands are expensive. In some cases, you get a great return on the brand, and it’s the appropriate thing to do. Certainly, on the big group houses are the most obvious places where they add value. But some hotels and Chico would be a great example, they are their own brand in a lot of ways, and we wouldn’t see — I don’t think we’d see a material uplift in demand from the brand and the cost. So I think the — it’s not a message that we don’t think the brands are valuable. We really do. It’s more a message that we try to tailor each individual asset to whether it makes sense to put a brand on it. Clearly, most of our hotels that have brand are performing significantly better than they would without a brand, both top and bottom line.
Anthony Powell: I guess maybe in Boston, I guess, what’s drove that particular decision?
Mark Brugger: Yes. Boston is kind of a unique location. It’s a historic building, and it’s in a 7-day a week location. And we looked at what it does not have a material group component, which is often a reason to have the brand to attract the groups. And it performs very well 7 days a week, but it’s a great business location. It’s also close to Faneuil Hall. It’s a great leisure location as well, and we thought that it can perform relatively equally well as a branded hotel with less cost associated with it. The other thing is even if it was just equal profitability, the unencumbered nature of having that hotel probably adds 10%, 50, 100 basis points on the back end. So it probably increases the NAV of the hotel by $15 million to $20 million. So those were the factors that led us to embrace this conversion.
Anthony Powell: All right. Thank you.
Operator: Thank you. One moment, please. Our next question comes from the line of Floris Van Dijkum of Compass Point. Your line is open.
Floris Van Dijkum: Thanks for taking the question. I guess maybe touch on the new acquisition a little bit more. How did you get to this transaction? You say you’ve been tracking it for a couple of years. What caused the owner to sell now and who else was bidding with you? And maybe just talk a little bit about what — what you see is this is an 8.1% yield, the right yield for this? Do you think this is the — talk a little bit about the acquisitions environment perhaps as well?
Mark Brugger: Sure. So I guess there are a lot of questions in there. So let me just start with the broadest which is the acquisition environment generally. The acquisition volume is down over 70%. There aren’t very many trades in the marketplace. In some ways, it’s a great time to be a public company because of our cost of debt advantage. We’re borrowing for plus 135, profit equity is borrowing at so for plus 450. So there’s clear advantage there. We obviously have to consider other capital allocation choices. This is kind of interesting. We love Montana. We like Big Sky, we like Bozeman. We love Paradise Valley. We like things in Jackson Hole and Yellowstone has been a high priority for us in our search for special properties.
This one is an institution in Montana. It’s a relatively famous small resort. We’ve been tracking it. The owner-operator has been the owner-operator for more than two decades and he’s looking to retire. So it was an opportune time. He staying involved in the property, and we’re going to leverage that relationship at the property and with the community. Interesting, this originally went under contract with a, I’ll call it, a private equity buyers, we understand it at $40 million about 6 months ago. We looked at it. We were very disappointed because that was more than we were willing to pay. And you could see how there’s a — it’s a really special kind of place. And that deal, for reasons we’re not privy to, fell apart, and we were selected because we were — we could pay cash, right?
