Sotherly Hotels Inc.

to begin. Please go ahead.

Thank you. Good morning, everyone. If you did not receive a copy of the earnings release, you may access it on our website at southerlyhotels.com. In the release, the company has reconciled all non-GAAP financial measures to the most directly comparable GAAP measure in accordance with Reg 2 requirements. Any statements made during this conference call, which are not historical, may constitute forward-looking statements. Although we believe the expectations reflected in any forward-looking statements are based on reasonable assumptions, we can give no assurance that these expectations will be attained. Factors and risks that can cause actual results to differ materially from those expressed or implied by forward-looking statements are detailed in today's press release and from time to time in the company's filings with the SEC. The company does not undertake a duty to update or revise any forward-looking statements. With that, I'll turn the call over to Scott. Thanks, Max.

Good morning, everyone. I'll start off today's call through a review of our portfolio's key operating metrics for the first quarter. Looking at the first quarter results for the composite portfolio compared to 2023, REVPAR increased 3.8%, driven by a 7.5% increase in occupancy and a 3.3% decrease in ADR. Looking at the first quarter results for the composite portfolio relative to 2019, first quarter REVPAR was up 1.4%, driven by ADR growth of 9.3% and occupancy down 7.2%. This occupancy gap to pre-pandemic levels reflects a significant upside for the portfolio moving forward. Overall, our portfolio's first quarter results, which were driven by strong occupancy growth, outperformed both top and bottom line budget expectations. The notable growth in occupancy indicates lodging fundamentals across our portfolio are nearing normalization following uneven post-pandemic recovery periods. Although the impressive occupancy gains were partially offset by a 3.3% decline in ADR, this drop in rate was almost entirely isolated to our South Florida properties. Our group-focused properties continue to be a key catalyst of growth for our portfolio, as our Wilmington Savannah hotels, both of which easily outperformed prior-year REVPAR, led the segment during the quarter. The DeSoto Savannah was particularly noteworthy, with first-quarter REVPAR outperforming prior-year by 11%, and outperforming Q1 2019 by nearly 32%. The high-centric Arlington, driven by strong year-over-year growth in the group and corporate segments, continued to fire on all cylinders during the first quarter. The property outpaced the prior period's REVPAR by 6.7%, driven by a 3.8% increase in occupancy and a 2.7% increase in rate. First comparable period in 2019, REVPAR improved by 12.7%, with occupancy flat and ADR up 12.7%. The property continues to be the leader in its competitive set, achieving a red part index of over 124% during the first quarter. The continued strength that our group focused hotels was coupled with a long awaited breakthrough in business transient performance at our slow to recover urban hotels in Atlanta and Houston during the first quarter. The Georgian Terrace in Atlanta has management teams efforts to drive increased corporate and association business to the hotel proved successful during the quarter. as occupancy improved more than 25% over prior year. In addition, the potential for recovery in the film industry business segment presents additional growth prospects moving forward. The White Hall in Houston improved its rev par by nearly 21% over prior year, which was fueled by a nearly 22% gain in occupancy. The White Hall's occupancy improvement was predominantly driven by growth in the transient business segment, which was up the prior year by nearly 30%, an encouraging sign of recovery for the hotel and the downtown Houston sub-market. We are optimistic the recent momentum in Atlanta and Houston will carry forward as the pre-pandemic occupancy gap that remains at these hotels present significant upside opportunity. Looking at profitability metrics for the portfolio, although hotel EBITDA margins for the first quarter of 2024 were 120 basis points below prior year, the decline was solely tied to increased property insurance costs in Q1 2024 versus prior year. With our insurance renewal that occurred April 1st, we are pleased to say the insurance markets have softened a bit and our costs have been reduced. With our Mende offerings now fully open, staffing and wages stabilized, and reduction in insurance costs, we expect margins to normalize going forward. Turn to corporate activity. Last week we announced the company executing an extension on its first mortgage loan for the Doubletree Philadelphia Airport Hotel. The interest-only loan, which has been reduced by $3 million to $35.9 million, matures in April 2026 and carries a floating interest rate based on SOFR plus 3.5%. As part of this transaction, we purchased an interest rate cap capping SOFR for a portion of the loan at 3%. In addition, we announced that the company entered into a 10-year franchise agreement with Hilton Worldwide to re-license the hotel under the Doubletree by Hilton flag. As part of the new agreement with Hilton, the company will undertake a renovation of the property with an estimated cost of approximately $11.5 million and an estimated completion date of April 2026. Renovation plans for the property will include upgrades to guest rooms, public spaces, food and beverage spaces, and the building's exterior. Lastly, in April, we announced the company executed a $35 million secure loan with city real estate funding on the Hotel Alba in Tampa, Florida. The interest-only loan matures March of 2029 and carries a fixed interest rate of 8.49%. This refinancing represents a culmination of our repositioning strategy, which created substantial value for the hotel and resulted in cash proceeds of over $10 million to the company. With that, I'll turn the call over to Tony.