Tony Domalski: I was just — I think what I would add is that I think our expectation is, as mortgages become due in 2025 and 2026 to 2027, we’re not going to be looking at the same interest rate environment. And if we are — we’re not going to be back down into inflation at 1.5% to 2%. And so I think there’s going to be — that as these mortgages mature and as our average weighted average interest rate in our debt rises, we’re going to see some amount of corresponding lift in ADR and hotel EBITDA to come to afford that.
Alexander Goldfarb: Okay. And you answered my next question, which was going to be on bank willingness to work with you guys, but you obviously answered that because clearly, the banks don’t want to add to their CRE portfolio. So it sounds like they’re doing what they can to adjust the balance and rate. So that way, it’s still a loan outstanding rather than you’re taking possession. That tends to be the MO right or otherwise?
Tony Domalski: No, you’re correct. That’s correct.
Alexander Goldfarb: Okay. Listen. Thanks a lot.
Tony Domalski: Thank you, Alex
Dave Folsom: Thanks, Alex.
Operator: Thank you. [Operator Instructions] Our next question comes from Jeff Hassannia from HD Enterprise. Your line is now open. Please go ahead.
Jeff Hassannia: Hi. Good morning,. Thank you for the transparency on your call. I sure appreciate it. I have two questions. The first question is dealing with the 11% drop in occupancy from the 2019 numbers. And you provided some rationale for that or what’s occurred in general in the marketplace? And then you also described what you think in the future in terms of market trends are going to help that recover back to maybe that 2019 number. But — so the first question around that is beyond just hoping the market conditions prevail, what are you doing proactively as a company from a competitive landscape perspective to help make sure that happens beyond just hoping the market conditions approve? That’s the first question. The second question I’ll just ask now as well.
If you had to look forward and project some nominal operating conditions, sort of a best case kind of forecast or a nominal case forecast going forward, when would you anticipate a potential return of dividends to common shareholders? That’s the second question.
Scott Kucinski: Well, the first question on the occupancy, I think it’s pretty consistent across our industry. One of the things we need to do at the property levels to make sure that we’re competing within our comp sets with the correct share capture. And that’s something we challenge our management company to do and that’s probably the nearest piece of low-hanging fruit to try to capture some additional occupancy. As you saw or heard in our prepared remarks, we’ve all talked about the upside in occupancy and some of that has to do with the recovery of group and business travel into the hotels, and that will lift group and lot revenue. It’s not singular to Sotherly hotels, this phenomenon with occupancy. Rate has been the driver of revenue over the recovery.
And I think to your second question, which was, when are we going to pay common dividends. As you’re probably aware, we can’t pay common dividends until we are caught up on any cumulative outstanding preferred dividends, and we are trying to pay those back. I can’t tell you the pace or frequency or time line to do that. But our management team is — were significant shareholders and we want a common dividend as bad as everybody else. I just — I can’t give you the time line on when that might happen.
Jeff Hassannia: All right. I appreciate it. Thank you for the color.
Scott Kucinski: Thank you.
Operator: At this time, we currently have no further questions. So I’ll hand back to CEO, Dave Folsom, for any further remarks.
Dave Folsom: No, thank you very much, operator, and thanks for everyone listening to our call, and we’ll circle back next quarter. Thank you.
Operator: Thank you for joining today’s call. You may now disconnect your lines.
