Chatham Lodging Trust

Good morning, ladies and gentlemen, and welcome to the Chatham Lodge and Trust Third Quarter 2025 Financial Results Conference Call. At this time, all lines are in listen-only mode, and following the presentation, we will conduct a question and answer session. If at any time during this call you require immediate assistance, please press star zero for the operator. This call is being recorded on Wednesday, November 5th, 2025. I would now like to turn the call over to Mr. Chris Daly. Please go ahead.

Thank you, Kelsey. Happy Wednesday, everybody, and welcome to the Chatham Lodging Trust third quarter 2025 results conference call. Please note that many of our comments today are considered forward-looking statements as defined by federal securities laws. These statements are subjects to risks and uncertainties, both known and unknown, as described in our most recent Form 10-K and other SEC filings. All information in this call is as of November 5, 2025. unless otherwise noted, and the company undertakes no obligation to update any forward-looking statements to conform the statement to actual results or changes in the company's expectations. You can find copies of our SEC filings and earnings release, which contain reconciliations to non-GAAP financial measures referenced on this call, on our website at chathamlodgingtrust.com. Now, to provide you with some insight into Chatham's 2025 third quarter results, allow me to introduce Jeff Fisher, Chairman, President, and Chief Executive Officer, Dennis Craven, Executive Vice President and Chief Operating Officer, and Jeremy Wagner, Senior Vice President and Chief Financial Officer. Let me turn the session over to Jeff Fisher.

Jeff? Thanks, Chris. Good morning, everyone. I certainly appreciate everybody being on our call today. Before I comment on our third quarter operating results, I'd like to update some of our key corporate initiatives. Earlier this year, we completed the sale of five hotels with an average age of 25 years at an approximate 6% capitalization rate, and each of these five hotels were among the six lowest REVPAR hotels in our portfolio. In the fourth quarter, we are under contract to close on the sale of another hotel for $17 million with similar characteristics and had similar returns to the previously sold five hotels. These opportunistic sales add liquidity to execute on other value-enhancing opportunities for the company. On that note, we've now repurchased approximately 500,000 or 1% of our outstanding shares of our stock at an average price of $6.85. Included in that amount is approximately 230,000 shares that we have repurchased since the end of the third quarter. We intend to remain active repurchasers of shares moving forward since we believe we are trading at a meaningful discount. Lastly, we completed an upsized and recast syndication of our credit facility and term loan, further enhancing our financial condition and lowering overall borrowing costs. We are one of the lowest leveraged lodging REITs and have great flexibility to create value by using that capacity to repurchase shares, acquire hotels, and fund our upcoming home to Portland, Maine development. With respect to acquiring hotels, we are somewhat more bullish on our ability to grow externally than we've been in the last 18 months. Deal flow underwriting has been steady here, and it seems like seller pricing expectations in some cases, are becoming more reasonable. We have been and will continue to exercise great patience and discipline as operating fundamentals are quite volatile. But of course, it is that volatility that I think is partially the catalyst for some movement in cap rates upward. The markets will have to make sense for us And, of course, yields have to approximate the implied yield on buying our own stock. We want to invest in markets that are going to benefit from continued population migration and business investment. The U.S. is poised to benefit from this potential capital expenditure, as they're calling it, super cycle, based on the announced investments from companies based here and abroad and And more specifically, it's expected that the central and southeastern U.S. will be the biggest beneficiaries in some of these investments and additions of employment. Operationally, despite REVPAR growing, excuse me, we'd like it to be growing 2.5%, declining 2.5%, we were able to minimize our margin decline to less than 100 basis points and we're able to deliver hotel EBITDA and FFO per share towards the upper end of our guidance range and beating consensus estimates. Looking at REVPAR performance in our largest markets, I want to address our Silicon Valley performance because on the surface, the decline appears weak. REVPAR at our hotels in Mountain View and San Mateo produced REVPAR growth of 2.5% in the quarter, while RevPar growth at the two Sunnyvale hotels fell 9%. The underlying fundamentals in Sunnyvale are healthy, with the third quarter sub-market and competitive set RevPar up, as opposed to our two hotels. RevPar was up 3% and 6%, respectively, in the market. Given the underlying health of the market, when one of our larger corporate accounts asked us to substantially discount our room rates we declined to participate. We believe the better long-term option for us is to maintain our rate integrity, and that will benefit us in the future as the market outlook, as we've discussed, continues to remain strong and the market is growing and recovering. Our coastal northeast and greater New York markets experienced rip-off growth of 2% and 8% in the quarter, And the coastal northeastern portfolio remains fantastic, benefiting from long-term supply growth restrictions in those markets, combined with a balance of leisure, business, and government demand. In fact, third quarter rev par at our Hampton Inn, Portland, Maine, set an all-time record high for quarterly rev par at any of our hotels. Just fantastic and another reason why we are excited about our upcoming development in downtown Portland on the waterfront. All three hotels in greater New York grew right prior to the quarter, led by our residents in Holksville, Long Island, which had growth of 28%, due in part to having the Ryder Cup on Long Island in September. However, that hotel was still having a great year through August, with year-to-date rent up 17% as corporate demand has greatly improved, really for the first time in that market post-COVID. And three of our top markets, San Diego, Austin, and Dallas, were adversely impacted by convention-related demand losses. The Austin and Dallas Convention Centers are basically closed for renovation, as we've discussed, and expansions, while San Diego is coming off a record year in convention business in 2024, and our 24 third quarter rep part was the second highest quarter ever at that hotel. So the comp is difficult, and the softening relative to 2024 in San Diego is really no surprise to us. Our six predominantly leisure hotels, which account for approximately 20% of our EBITDA produced REVPAR growth of 3% in the quarter. Within that group, our Spring Hill Suites Savannah had a great quarter with REVPAR up over 30% as it has really surged after completing a fantastic renovation that was very well received by our guests and customers. Our fourth quarter rent part guidance assumes that our current rent part trend of a decline of approximately 3% continues for the rest of the year, unfortunately. It's really been a crazy year, a volatile year. Hotel room demand and thus revenue has certainly seen its share of ups and downs this year. Encouraging business demand growth across the portfolio in the first quarter has been adversely impacted since then by Dodge travel spending halts, tariff threats, Liberation Day impacts, and, of course, inbound international travel, and especially from Canada being down substantially, and now with the government shutdown, certainly doesn't help matters. Many of these challenges should be short-term, however, and the impact primarily on 2025 performance. But looking forward, lodging dynamics are very favorable. Forecast for super-cycle capital investments, limited supply growth, and moderating wage increases all tilt in favor of REVPAR and margin expansion as we look forward to next year. Add to this what is projected to be a favorable interest rate curve and thus lower borrowing costs should enable us to accretively grow as we move forward. Good years are ahead. With that, I'd like to turn it over to Dennis.