Dori Kesten: Okay. Thanks.
Operator: Thank you. Our next question is coming from Ari Klein with BMO Capital Markets. Please proceed with your question.
Ari Klein: Thanks and good morning. On the CapEx front, you noted the disruption headwinds this year. Is there anything notable for next year that we should be thinking about? And then one of your peers announced a broader CapEx program alongside of the brand. Obviously Park has many Hilton Hotels. Is something of that a potential in the future for you?
Tom Baltimore: We are not in discussions with Hilton about any kind of broader CapEx program. Hilton is a great partner and we work closely with them. Those programs are show well and sound good. There’s always complexity behind them and we are not in discussions with Hilton on that front. Regarding next wave of ROI projects, we look at our Royal Palm Resort in South Beach on the ocean front just fabulous real estate that’s one that our design and construction team are beginning to spend additional time on as we move forward. Obviously, we are looking at another tower that will renovate Hilton Hawaiian Village. But I wouldn’t say that there’s anything material that’s going to be very disruptive in the 2024 as we look out right now.
We’re very careful trying to minimize our disruption to really 100 basis points of RevPAR approximately. Sometimes that will be a little more, a little less. But we’re very thoughtful about making sure that these strategic ROI projects no doubt the investments that we’ve made and that have been communicated are going to provide great tailwinds for us as we move forward, but we’re going to be continuing to reinvest where we make the money. And certainly Hawaii is a great example as we look out for some of those bigger projects. We’re also looking at expanding our resort, our property in Santa Barbara adding additional keys there. So the embedded ROI opportunities within the portfolio over the next several years are significant and we’re pretty excited about that.
Ari Klein: Thanks. And just maybe following up on Hawaii. You noted the Japan, the Japan seats capacity picking up pretty meaningfully going forward. Are you seeing that translate into bookings yet?
Tom Baltimore: Again as we said for fourth quarter we’re looking at Hawaii being, kind of, low double-digit. So the answer is we are encouraged and yes optimistic and as a team there also works with some of the tour operators and as the Japanese traveler comes back very exciting. That will be again another tailwind for Hawaii as we look out.
Aryeh Klein: Appreciate it. And I’ll echo the congrats on the deal.
Tom Baltimore: Great. Thanks.
Operator: Thank you. Our next question is coming from Anthony Powell with Barclays. Please proceed with your question.
Anthony Powell: Hi. Good morning.
Tom Baltimore: Hi, Anthony.
Anthony Powell: Hi, Tom. Question on New York. In a few I guess reach with a lot of exposure there which is sort of positive here. That property did about $50 million of EBITDA pre-pandemic margins in the mid-teens. Shouldn’t you be able to exceed that now given the structural changes in that market? And are there any more cost savings you can maybe get out of that property?
Tom Baltimore: Yes, it’s a great question Anthony. I will tell you we are think back to the pandemic and how the pundits thought, right? New York would either never come back or it would be 2026, 2027, 2028 we’ll largely be back to pre-pandemic this year in 2023. We’re up 30% in the third quarter. I think the October forecast plus or minus is probably in the 12% to 15% range. Looking at a solid fourth quarter and we’re looking at a significant increase for the year, but we had 44 sellout nights in the third quarter four times what we had last year. And I think in 2019 it was around 60 plus or minus. So we’re very encouraged. I think, as I said earlier, Sean may have had in his prepared remarks about October revenue of about $32 million, which is about $2 million south of the all-time high which I think was in May of 2018.
And then when you look at supply contracting you look at short-term rental regulations again causing about an 80% reduction I think in Airbnb from 23,000 down to 3,000 units. New York looks very different. Now again we only own one asset there in that market. But we are very encouraged as we look out. Group pace is for 2024 is about 109% I believe of 2019 levels. So New York is — and given that asset you’ve only got three big assets that can handle group business. We’re cautiously optimistic and we do think there’s an opportunity to continue to retool it and continue to improve efficiencies. So our outlook there is encouraging.
Anthony Powell: Thanks. And maybe just on asset sales. There have been a few deals in Boston San Francisco and some other markets. Are you marketing properties? And then what’s your view on dispositions for this year and next?
Tom Baltimore: Yes. We’ve closed on one sale. Obviously, we’re not a desperate seller. We’re going to remain disciplined on our pricing expectations. And with that backdrop we continue to focus on selling non-core, but we’ll be disciplined about it. Those transactions under $100 million are easier to certainly execute, but again our Chief Investment Officer, Tom Morey and his talented team are working hard and we’re confident we’ll put some points on the board here if have not done by the end of this year certainly into early next year. But you’ll continue to see us with the same playbook continuing to reshape the portfolio. Listeners may forget now but we have sold and disposed including San Francisco now 42 assets for about $2.7 billion and that’s including international laundry facilities. We have cleaned up and reshaped this portfolio significantly since the spin. And really proud of the team and the great work that’s been done.
