Anthony Powell: All right. Thank you.
Operator: Thank you. Our next question is coming from Jay Kornreich with Wedbush. Please proceed with your question.
Jay Kornreich: Hi. Good morning.
Tom Baltimore: Good morning.
Jay Kornreich: Good morning. Just going back to capital allocation for a moment. You talked a lot about internal growth story and ROI. I guess from an external growth story it’s been a while since you had made an acquisition and now with the removal of the San Francisco assets maybe there’s a desire to smooth out the demand profile and look a little bit away from Hawaii is a fantastic market. Can you just provide any comments as to your ability and desire to acquire at this stage? And maybe what you’d be looking for if so?
Tom Baltimore: The ability and desire would be high. I think the question is sort of at the right price in the right time. At this point given where we’re trading at these huge discount obviously, to both replacement cost and NAV. The best capital allocation decision would be selling non-core assets and buying back our stock or reinvesting in our portfolio. Having said that, we are actively looking. You’ll see us certainly we too there pockets and geographies, where we’re less represented. Clearly Nashville is a market of Florida adding more in Miami area would certainly for Lauderdale I would certainly be of interest to us. Phoenix is an area in Scottsdale that we certainly would be open to Austin probably not in the near term given what’s happening with the convention center and the work that’s being done but that’s certainly on our list as well.
So Sunbelt remains high but I think that area is also moderating. It’s had a quite a run up. And obviously, with that reversion back to the mean. I think hopefully, that will give the opportunity for better pricing. But no doubt we are in this to grow the business. And our deal team continues to underwrite, participate and we have the capacity to do something if something is priced right in the right situation.
Jay Kornreich: Thanks. Appreciate that commentary. And then I guess just as a follow-up. Now that leverage is coming down to low around 5.2 times as you mentioned, is that a level you’re comfortable with? Or do you have your eyes set on a specific range or number you’d like to get that leverage to?
Tom Baltimore: As we said from the spin, we were always in that three to five times. Obviously, we had to go over that obviously, given the pandemic of what happened. But getting certainly in the four times is certainly a target for us. But we feel a whole lot better. And we certainly think the narrative should change and will change with the recent actions and where we are now in the low five times for net debt to EBITDA. And given the – the outlook as we see growth in EBITDA next year and beyond as we move forward.
Jay Kornreich: Got it. Okay. Well, that’s it for me. Thanks very much.
Tom Baltimore: Thank you.
Operator: Thank you. Our next question is coming from Chris Woronka with Deutsche Bank. Please proceed with your question.
Tom Baltimore: Hey, Chris.
Chris Woronka: Hey, how are you? Congratulations on a lot of good stuff that happened this past quarter. Appreciate the comment. I wanted to kind of drill down on group rates a little bit if we could. I mean people focus on leisure, resort, pricing and how that are mobilized. I think we’re to see that it’s not the end of the world on groups, where do you think you are on groups of being able to – willing to absorb higher price [indiscernible] before in 2021 2022 and before. I mean are you more optimistic about what group pricing looks like for 2025, 2026, 2027. Just trying to get a broad sense as to how much more momentum might be there.
Tom Baltimore: Yes. Let me – you were breaking up a little bit Chris but I think I got the gist of your question about. So if you look at group, if you look at 2024 as an example, and I’ll just give ranges, your room nights probably in that 85% to 90% range of 2019. But if you look at rate it’s probably in the 105% to 110% approximately of 2019. So rate is strong and we’re not seeing any hesitation. And look in this sort of hybrid world where things are evolving and the importance of group, people are willing to spend more, whether that’s for meetings or celebrations incentives and getting the need to bring their people together. So we’re not seeing hesitation. If anything we see that is another lines of business and certainly better flow-through and better utilization of our properties.
So and given the fact that you – when was the last time you saw a group a large group hotel get constructed, not happening very often. We also see that as a real benefit for the Park portfolio as we move forward.
Chris Woronka: Great. Very helpful. Thanks.
Tom Baltimore: Thank you.
Operator: Thank you. Our next question is coming from Chris Darling with Green Street. Please proceed with your question.
Q – Chris Darling: Hi, everyone.
Tom Baltimore: Hi, Chris. Tom ,can you dig into business transient demand, how that’s trended as we move past Labor Day? And then what’s your sense of what’s happening with the larger corporations? Have you seen any positive momentum in that regard?
Sean Dell’Orto: Chris, this is Sean. I mean I would think we have seen better-than-expected results coming out of Labor Day. I think again, some of the key components of business transient being corporate negotiated ultimately, outperformed expectations coming in Q3 and I think we’ll continue to do that as we get into kind of early stages of Q4. That said, I would think we’re still kind of looking to see that corporate negotiated subsegment that’s dominated by those bigger businesses and bigger corporate, come back certainly 20% to 30% down relative to 2019. Part of that now is I think understanding, if it’s just more of a focus now by our operators to just go after some of the smaller businesses, that they wouldn’t really pay attention to this.
