Gary Shiffman: Well, Josh, we certainly got off to a good start and shared the two assets that we did sell. We are currently in the market. And there are a number of opportunities that we feel very good, within the selected assets that we offer for dispositions. Again, these are assets that we feel will benefit somebody else in the long run. And there are still buyers out there. There are those that are looking to build platforms, and looking past the negative leverage, if you will. But there is definitely, a shift in the marketplace with debt costs being higher than they had been for the last long period of time. We look forward to being able to share with everybody the results, of these dispositions that we have in the market right now. And hopefully, we’ll be able to do that in this coming quarter.
Q – Josh Dennerlein: I appreciate that, Gary. And then I just wanted to follow up on Michael’s question, about the guidance. When I think about your guides, it almost seems like every line item the range was revised. Just maybe stepping back and thinking big picture, how do you — like what’s your philosophy on providing these guidance ranges.
Fernando Castro-Caratini: We’re looking to provide as much disclosure as possible to the market, as it relates to all of the — all of our business platforms and other line items. So you can — with the guidance, you can track almost entirely P&L. We did add guidance in February, as it related to expected interest expense which had not been provided previously. So that is that’s looking to provide as much color as possible to the market, as it relates to our expectations, those expectations some shift upwards some shift downwards, as you’re seeing with the guidance provided last night. But it’s the best information that we have in front of us today to provide to you and the rest of the market.
Gary Shiffman: Josh the only thing that I would add to that is the fact that we certainly got through a lot of challenges in 2023 have had some headwinds in 2024 as we’ve shared with everybody. But I’ve also shared a strong desire to be simplifying and assisting with the ability to model. So, we continue to do a lot of work on that. And as we go through 2024, some of the steps that are taking place I think will put us in a cadence be able to provide an understanding and information as we go forward. A good example is U.K. home sales where we will sacrifice the margin and made a decision and management is actually executing on the decision to increase volume at the cost of a little bit of margin to add to real property income. They’ve done an outstanding job at Park Holidays. We really want to commend them on that. And it’s things like that that are causing adjustments. But I think as we continue quarter-by-quarter, we’ll take a cadence that will feel much better.
Josh Dennerlein: Okay. Appreciate the color.
Operator: Our next question comes from Brad Heffern with RBC Capital Markets. Please proceed with your question.
Brad Heffern: Yes, thanks. Is there any color that you can give about the pace at which you expect to move NOI out of the U.K. home sales business and into real property going forward? Should we continue to see sort of big chunky moves like this as the year goes on? Or does the guidance kind of fully reflect the underlying change in strategy?
Fernando Castro-Caratini: The guidance fully reflects the underlying change — or not a change in strategy, but the continuation of that strategy of shifting more right more income into the reliable real property side.
Brad Heffern: Okay. And is there any color you can give on kind of the pace at which we should expect that to happen? Obviously in the U.S. home sales are not a big contributor. Is there visibility on that happening in the U.K. over the next five years or three years? Or any sort of framework you can give us around the speed at which you can accomplish the transition?
Gary Shiffman: Brad are we talking about the U.K.?
Brad Heffern: Yes, for the U.K.
Gary Shiffman: Again I’d kind of reiterate what Fernando said in the fact that even going back to when we announced the acquisition we had a strategy recognizing that the model in the U.K. is different than it is in the U.S. And we would sacrifice margin for increase in occupancy and gaining that more sticky dependable if you will and modelable is such a word FFO on the real property side. So, what you’re seeing is a continuation on that. We — in 2023, definitely hit headwinds of a slowing economy that caused that to accelerate faster than our five or seven-year plan originally had it. But I would say right now where we’re at we’re right on target where we want them to be with Park Holidays. And I think you’ll just continue to see us hit guidance and if things should improve or if we have an opportunity to make more rapid we would definitely share that in the future.
Operator: Our next question comes from Wes Golladay with Robert W. Baird. Please proceed with your question.
Wes Golladay: Hello, everyone. I just want to go back to the transient forecast. Can you unpack that a little bit? What has driving the EBITDA adjusted for the conversions? Are you seeing any rate pressure? And then when you have your forecast for the balance of the year, are you extrapolating the current trends into the balance of the year?
Gary Shiffman: Wes we continue to believe in the long-term strength of the overall RV sector. And as you know, we’ve been strategically reducing our transient exposure, and relative contribution over the past few years in favor of the stability of the growth of the annual agreements that we’re really, really focused on. So we’ve increased the annuals by about 27% by converting the transient since 2020 and our expectation and our outlook moving forward, if you’ll continue to see that. And again, that allows us to budget and forecast with a higher degree of confidence, as we have those homes in on an annual basis. And they’re not subject to the concerns of whether again much of the transient is within a three-hour drive of the home base of our guests.
And so weather conditions as we saw in April. And as we’ve seen more recently in the last couple of years, do impact that short-term transient guest stability, to be able to forecast it. So I think that, while it’s a good business. And we will continue to have a percentage of it. We will continue to focus on converting those transient over to annuals. And we’re seeing stronger-and-stronger demand and we’re opening up more-and-more of our transient sites and will allow them to be converted to annual.
