Service Properties Trust at Nareit REITweek: Strategic Shift to Net Lease Retail

On Wednesday, June 4, 2025, Service Properties Trust (NASDAQ:SVC) presented its strategic transition at the Nareit REITweek: 2025 Investor Conference. The company outlined its ongoing shift towards net lease retail and the streamlining of its hotel portfolio. While SVC highlighted growth opportunities in net leases, challenges such as labor costs and international travel softness were acknowledged.

Key Takeaways

• Service Properties Trust is divesting 123 hotels to focus on net lease retail.
• Proceeds from hotel sales will repay $800 million in senior notes due in 2026.
• The company aims to reduce leverage from nearly 10x debt to EBITDA by a full turn.
• SVC is actively pursuing $40-50 million in net lease acquisitions with a focus on QSRs, grocers, and car washes.
• Current dividend payments are modest, with potential increases discussed for 2026 or later.

Financial Results

• RevPAR Growth: Q1 RevPAR grew modestly by just over 2.5%, affected by renovations.
• Net Lease Acquisitions: Targeting $40-50 million in acquisitions with yields around 7.5% and annual growth of 1.5% to 2%.
• Debt and Maturities: $800 million in senior notes maturing in 2026, with a goal to reduce leverage by a full turn post-hotel sales.
• CapEx Spending: $250 million projected for the current year, down from $300 million in 2024.
• Dividend Policy: Current dividend is a penny per quarter, with potential increases discussed for post-2026.

Operational Updates

• Hotel Portfolio Transition: SVC is divesting 123 primarily focused service hotels, with sales expected in Q3 and Q4. The remaining portfolio will consist of 83 predominantly full-service hotels.
• Net Lease Portfolio Growth: The company is focusing on acquiring properties in QSRs, grocers, and car washes, aiming for a portfolio of over 700 properties.
• Travel Centers: Assets are considered "crown jewels," with leases guaranteed by British Petroleum until 1933, although rent coverage is declining due to fuel margin normalization.
• CapEx Investments: Renovations completed at Hyatt and Radisson sites, with ongoing projects at South Beach Hotel.

Future Outlook

• Portfolio Composition: Over 70% of EBITDA is expected to come from net lease post-sales.
• Leverage Reduction: Aiming for a full turn reduction in leverage after hotel sales, with an additional reduction in the medium term.
• Strategic Focus: Continued emphasis on growth in the net lease sector while maximizing the value of remaining hotel assets.

Q&A Highlights

• Hotel Sales Proceeds: Proceeds will primarily repay $800 million in senior notes maturing in 2026.
• Net Lease Acquisition Strategy: Focus on QSRs, grocers, and car washes, utilizing a master trust structure for financing.
• Balance Sheet and Leverage: Efforts to reduce leverage to improve financial flexibility.
• Dividend Policy: Potential increases are contingent on deleveraging and improved EBITDA performance.

Readers are encouraged to refer to the full transcript for a more detailed understanding of Service Properties Trust’s strategic plans and financial outlook.

Full transcript - Nareit REITweek: 2025 Investor Conference:

Tyler Batory, Analyst, Oppenheimer: Alright, perfect. Alright, good morning everyone. We’re gonna get started with our next session. This is Tyler Batory with Oppenheimer. Really happy to be with the management team from Service Properties Trust, SVC.

Chris and Brian are with us today. Got some questions prepared for them, but certainly want to encourage audience participation. So, you do have questions at any point, just let me know and we’ll get answered. So, glad to be up here. Good to see you guys.

I think we probably have some folks in the audience that are familiar with the SVC story. I would imagine some folks that are a little bit newer to the story. So just to start off, just give us a quick summary of the SVC portfolio, talk about what makes you a little bit different than some of the other REITs that are out there.

Chris, Management Team, Service Properties Trust: Yeah, so again, thanks for being here. I think holistically, if you think about the company, we’re predominantly a lodging and net lease portfolio. As you think about kind of how our portfolio is constructed, I think by way of assets, we have just over 200 hotels across the portfolio, which really focus on full service and focused service. Sorry, I’m getting the mic ask here. Full service and focused service with about 35,000 keys constructed within that portfolio, and then on the net lease side, we have just over 700 properties, predominantly concentrated in travel centers, just under 200, with the balance being traditional kind of necessity based surface focused retail properties.

And so, you know, really for us, the story has been about a repositioning strategy for the company, and I think what I mean by that is we’ve been in the market looking at divesting of certain hotels, really shifting our focus more towards a net lease strategy, and with kind of the retained portfolio on the hotel side, kind of with a lens more towards full service hotel operations across the portfolio. And in addition, we’ve been looking at opportunities to expand on the net lease platform, which we’ll talk a little bit about in the Q and A, but nonetheless have really been spending a lot of time kind of calling the portfolio, looking for opportunities to monetize, looking at opportunities with respect to our balance sheet to really position the company to be in a growth place as we turn the corner with the year. That’s where a lot of our time has been spent.

Tyler Batory, Analyst, Oppenheimer: Okay, so let’s dive into the hotel business a little bit first and talk a little bit about what you’ve been seeing so far this year from a RevPAR perspective, from a demand perspective, where there are areas of strength, areas of weakness and just kind of give us a sense of what you’re seeing in the marketplace.

Chris, Management Team, Service Properties Trust: Yeah, think if you think, if you look at kind of the quarter, our RevPAR saw modest growth just over 2.5%. I think with embedded in some of that our displacement with renovations going on across the portfolio, we’ve had a pretty extensive renovation plan going into 2024 and even continuing in the first part of twenty twenty five. So there’s some ebb and flow that comes with that. I think generally speaking, we’ve seen some challenges on the margin side. I think more attributed to just increases in labor costs, certain one time events, the displacement certainly being a portion of that.

And so navigating that has been something that we’ve been focused on. And I think more broadly speaking, as you think about just the hotel industry, I mean, there’s been some headwinds. We’ve talked a little bit about some pullback in RevPAR going into Q2. We provided guidance around that more specifically. And I think as we sit here today, that trend is kind of consistent with our guide on that front.

But look, I don’t know that it’s dissimilar from kind of broader feedback across the industry, but international travel is something where there’s been some softness. As you think about our portfolio, I guess, constructed against the top 10 markets, it represents a little less than 30% of our portfolio. And so, you know, while not immaterial, I think there is some opportunities outside of those markets for us. And then, you know, if you kind of, you know, strip it down even further, I would say the areas where we’re seeing some pullback is in government spending. So with respect to government contracts, we’ve seen some proceeds kind of get pulled coming out of Q1.

On the other side with group, you know, there’s been some upside for us on this side of the business, you know, projecting kind of north of 8% growth for the year. So it’s a little bit of take and give, but nonetheless it’s somewhat muted. Okay.

Tyler Batory, Analyst, Oppenheimer: So one of the key parts of your story is the transition that’s going on within the hotel portfolio. So you have a number of assets that are for sale right now. Talk a little bit more about how that process is going and give us a strategic sense of why you’re selling the assets and what you’re going to do with some of the proceeds?

Chris, Management Team, Service Properties Trust: Yeah, I think the strategic point kind of goes back to some of the introduction where we’re really trying to kind of transition the portfolio to be more focused on net lease retail. I think the construct of that has been in place over the years. We bought a large portfolio in 2019. And really for us, just given market dynamics and other fundamentals, we just haven’t had the opportunity to do a lot with that. But nonetheless, given where we are today, there’s some strategic incentives and some other opportunities for us on that side of the portfolio, which we can talk about in more detail.

But as part of kind of that shift, we’re also talking about the divestment of hotels. We have about 123 hotels in the market, primarily focused service. There are really kind of three different tranches, a handful a very small portion are legacy sales that are just kind of being finalized this quarter. We’ve got a full service hotel that we’re in the market with, but the bigger tranche that I think has been kind of the core of the conversation is specific to 114 focused service hotels that we began marketing kind of going in into the end of last year. For us, we’ve gone through kind of a traditional marketing process.

We saw a lot of activity. First round, we had 50 groups putting in offers on the portfolio. Fast forward, we’ve narrowed that down to four buyers for subset portfolios and are kind of in the throes of that process with respect to executing on those.

Tyler Batory, Analyst, Oppenheimer: Okay, so once you complete the, I mean, so any sense too for timeline in terms of when these could be done and kind of thinking a little bit longer or farther out, any more sales that you might look at in the hotel portfolio?

Chris, Management Team, Service Properties Trust: Yeah, so on the timeline front, I think as we will probably see the bigger portion of the transaction occur in Q3 and then some of that to trend into Q4. And really kind of the rationale is, like with any sale, you’ve got diligence period, you’ve got some closing timelines that come with that, and then even some staging on the takedown, just given the size of the portfolio. So it’s going to there’s going to be some movement in the timing, but we’re targeting right now Q3 and Q4 being the process with respect to those close. I think with respect to future sales, I think right now, this represents kind of the bulk of what we think for the hotel sales for the company. Look, we’re always looking to be prudent within our business to look at opportunities, but I think that’s kind of a conversation for a later day, getting through these transactions, understanding what we have on the other side, thinking more about the business and some of the opportunities, that’ll be part of the conversation.

Tyler Batory, Analyst, Oppenheimer: Okay, so once you complete these, there’s gonna be a lot of capital coming in the door. Just talk a little bit more in-depth, what you do with that capital, best uses and kind of how you’re thinking about that too.

Brian, Management Team, Service Properties Trust: Yeah, for the use of proceeds, we have $800,000,000 of senior notes maturing in 2026 in two separate maturities, dollars $350,000,000 in the spring and then the balance, the $450,000,000 in the fall of ’twenty six. So we expect to repay those bonds with the proceeds. The balance of the inflow that we’re expecting will be used to either repay the revolver or we’ll consider paying further dated bonds with these proceeds.

Tyler Batory, Analyst, Oppenheimer: And then once everything is done, I guess what’s gonna be left in the hotel portfolio? Just talk about those assets, kind of where they’re located, the quality of those assets, the financial performance as well.

Chris, Management Team, Service Properties Trust: Yeah, so at the end, I mean once we get to the transactions we’ll be left with a portfolio of 83 hotels, predominantly full service. There’ll be some other kind of focused service hotels embedded within that. It’ll be across a handful of different brands as part of that. And I think kind of big picture, look, we’ve done a lot of work across the portfolio by way of investment into the hotels. I think more specifically kind of our full portfolio of the Hyatt hotels we renovated last year.

And so we’re really starting to kind of see the benefit of that lift coming into Q1. And there’s additional runway we would expect going into the balance of the year. Same with other hotels within our Radisson site portfolio, a very similar narrative. And so, look, I think from where do we go with performance of hotel, I mean, I think given kind of just broadly speaking where the trends are and then in our portfolio more specifically around, you know, the work we’re doing displacement, hotels coming out of renovations, hotels going into renovation. We expect some of our kind of RevPAR and other metrics to be somewhat muted initially.

But nonetheless, as we get through some of these tranches of investment, we think that there will be further benefit of upside, more specifically as we get into the middle of next year and beyond.

Tyler Batory, Analyst, Oppenheimer: So just to really hit this point home, because it is very transformational, I mean, it an intellectual jump to assume that once all this heavy lifting is done that what you’re left with should probably be worth more than what you’re selling and where things were before? Absolutely. I mean I think just generally speaking when

Chris, Management Team, Service Properties Trust: you think about the depth of the portfolio, the locations where we have, these are a combination of full service resort hotels. These are in core markets, some in kind of really prime locations that are irreplaceable. And so certainly, from an overall valuation standpoint, we would expect there to be kind of a better positioned portfolio not only for EBITDA growth but just overall value contribution to the company.

Tyler Batory, Analyst, Oppenheimer: Okay. So switching gears to the travel center portion of the portfolio, I think a unique aspect of the company. Talk a little bit more about those assets, why you like those assets and then talk a little bit about the relationship with BP too. And I believe there’s some noise going on Does matter for you?

Is that something that you’re paying attention to?

Brian, Management Team, Service Properties Trust: Yeah, the travel center assets we really consider are crown jewels of the portfolio. These large sites along the interstate highway system. There are truck stops with their own little ecosystems with service for trucks, quick serve restaurants, convenience stores. The volume of revenues coming through there are primarily fuel, diesel fuel and whatnot, but the largest share of the profits come from the other services. So they’re very unique businesses in the retail space, if you will.

So that portfolio is five different tranches, five lease pools, master leases. If those who know the story, we had bought TA back in 02/2007. The operating company was spun out. We kept the real estate in the sale leaseback scenario. A few years ago, BP bought the operating company and did direct leasing with us, SVC.

So all the leases are now guaranteed by British Petroleum and A credit. So we feel very good about those leases. They all expired. There were ten year leases that expire in 02/1933. And the recent news around BP and the headlines, there’s an activist, some noise around activism at the corporate level.

There’s been rumors that and this is not unique to this year, but over time, there’s been rumors Shell might take over BP or other companies. So there’s been a lot of headlines with that company. The rent coverage at our sites which is a key metric we disclose for all our retail tenants, rent coverage has been on the decline. The company was sold, we were at all time high fuel margins at levels we had never seen since our acquisition in ’seven. There’s been sort of our normalization and rationalization of that business.

Freight demand is definitely down, fuel margins are clearly down in the business. But we have comfort and we sleep well at night with those leases that we have a corporate guarantee from strong credit. We will continue to moderate, we continue to dialogue with BP. They still have a long term view as far as our understanding of those assets and again we feel like these assets are long term plays, strong real estate well beyond the lease terms that we have today.

Tyler Batory, Analyst, Oppenheimer: So, I’m curious to the net lease side of things and I think first just for backgrounds, talk about what you own right now on the net lease side of things when you bought it and kind of how net lease became part of the SVC portfolio?

Chris, Management Team, Service Properties Trust: Yeah, I mean kind of the biggest impetus for kind of the integration to net lease as a portfolio or a company we bought in 2019, which was really our introduction to net lease outside of the travel centers. And so, you know, as referenced, we have just over 700 properties within that pool. This is really a consortium of, you know, QSRs, sit down restaurants. We have wellness facilities, you know, entertainment, etcetera. But the biggest concentration really being around kinda QSR, grocers and full service restaurants.

And really, for us, again, we’ve been working over the years looking at opportunities for that portfolio, have not been active on the acquisition front, just kind of given where the market dynamics were and other focuses with hotels and things we were doing. But nonetheless, puts us in a kind of a good position today to really evaluate strategies around further growth within that portfolio. You know, earlier this year, we kicked off a process where we were starting to kind of originate new acquisitions. Sitting here today, you know, we’ve got about 40,000,000 to $50,000,000 kind of advanced in the pipeline or under contract with that endeavor, and we would anticipate that, that cadence will continue. I think for us specifically, part of it is an opportunity to participate in what we believe to be a strong growing sector.

I think it from a valuation standpoint, I think it’s good for the business and provides consistent, steady cash flows. You know, we’re talking about yields going into these at about 7.5% with kind of growth at 1.5% to 2% annually. And on average, we’re doing terms twelve to fifteen years. So really kind of setting kind of a cadence and a narrative for the company on a go forward basis. And I think the other thing that’s important to note, and we can dig into this more specifically as we talk about the balance sheet, is we have a really interesting structure with a master trust, specifically around retail, and about half of our assets are within that master trust, which is a very flexible financing instrument for us to pull properties in and out of.

And with that are very attractive rates that come with that. And so we view that as a real kind of catalyst for us as we think about future opportunities for financing or refinancing to kind of get the best rates or the best cost of capital for the company.

Tyler Batory, Analyst, Oppenheimer: So let’s unpack a little bit more of that commentary on the net lease side of things. In terms of the timing, why make this transition now versus a year ago or maybe a couple of years in the future? Why does it seem like now is really the right time? And just put some guardrails at least in the short term a little bit more just on kind of the magnitude in terms of how much dollars you’re thinking about potentially allocating towards this side of things?

Chris, Management Team, Service Properties Trust: Yeah, so the net lease is just a function of kind of one piece of the story that we touched on, It really comes down to with the hotel sales, the why now, it’s a couple of different things. Think on the hotel sales themselves, I think generally speaking, we feel like there’s more conviction around a shift of the portfolio, again, more to the full service model, just given where certain trends are around business travel and other logistics that we think will benefit us longer term being in the more full service sector. And I think equally important from a timing standpoint, there’s been a lot of dry powder sitting on the sideline looking for larger portfolios to invest in And kind of going to the market with a portfolio as we have was somewhat unique. And I think from a timing standpoint, it really allowed us to benefit from a deep kind of buyer pool. And I think that’s kind of showing us some of the pricing that we are getting on some of these hotels.

So strategically, we feel like we’re in a good position, you know, despite some of the capital markets, despite where cap rates are, you know, just given the size and the quality of the portfolio, we’re able to kind of get a real value push and in turn, I think as Brian alluded to, helping delever the company, which is kind of a big part of our business plan. And then complementing that, going to the net lease side, it’s just it’s more of a refresh of the portfolio, right? This isn’t necessarily kind of an incremental push where, you know, we’re going to come out of the gate and start spending an over material amount of money, but at the same time, being in a position where we can refresh this portfolio both from legacy assets and new acquisitions and pushing some of the metrics to have a longer wall, better coverage, I think from both financing opportunities and just valuation of the organization, it really provides some synergies. And so we’re doing the we have the pipeline, you know, currently about 50,000,000 today. We’ll likely see that grow modestly.

And then I think we’ll determine after these dispositions, kind of sitting on the other side of the equation, to be really more thoughtful around how big do we want that pipeline to be or do we want this to be the run rate. So there’s still some moving pieces of how we want to think about And again, just to kind of be mindful of the other opportunities, whether it’s further delevering and using proceeds for other reasons, there’s capital investment in these hotels even with the retained portfolio. So we’re being mindful of those options.

Tyler Batory, Analyst, Oppenheimer: Yeah, so a couple more follow ups here on this topic. You mentioned the pipeline $50,000,000 I guess any more you can give in terms of where the assets are located, what type of assets they are? Is it going be kind of pretty similar to what you own right now or you may think about differentiating and diversifying a little bit more?

Chris, Management Team, Service Properties Trust: It’s somewhat similar to what we own now. I just think when you look at where our concentration is, I think more broadly that is, in our view, the better part of the sector today. And so continuing to add to that is something that we feel is favorable. What we’re buying today in that pipeline is predominantly QSR grocery and car washes. Those really make up the bulk of at least those acquisitions.

And then we see we have other opportunities, I guess, kind of making their way through the pipeline that are not dissimilar. Some other we have looked at some opportunities with some dollar stores for more of the credit side organizations and things of that nature. But generally speaking, it’s kind of within kind of those four or five sectors. And I think, you know, just to note too, as we buy net lease retail and going back to some of the financing opportunities with that, there are guardrails around, you know, kind of like a master trust and what we can do with that and the allocation across the sectors that we’re also working within the confines of to ensure we get the best outcome.

Tyler Batory, Analyst, Oppenheimer: Okay. And then how about the valuation side of things just to bring even more numbers into this, where cap rates for some of these, like how do you think about deploying capital towards this channel versus kind of where your debt yields versus buying back stock and other avenues and other uses? Uses?

Brian, Management Team, Service Properties Trust: Sure. From a cap rate perspective, we’re really looking at this net lease program from a perspective of future financing within master trusts which we believe would be accretive to the overall company. That execution we did a couple of years ago, coupon is 5.6 today, market

Chris, Management Team, Service Properties Trust: is

Brian, Management Team, Service Properties Trust: a little wider than that in this current market. But nonetheless, we think these deals will be accretive in that financing scenario. So as we build critical mass and potentially tap that market down the road, we believe it will be beneficial to the company. Part of the strategy of the hotel sales back to the proceeds we’re going get in, whether or we can repay or recapture some of the wider trade bonds beyond just the 26s is part of the strategy as well. So we’re looking at this from all different lenses.

Tyler Batory, Analyst, Oppenheimer: Okay. So let’s transition to the balance sheet and the debt side of things. Leave the mic over there. Probably number one question or maybe number two question that I get from clients and investors is leverage. So talk a little bit about where the balance sheet is right now, where leverage is right now, I’m not sure if you have a longer term leverage target or something ideally that you would like to get to into the future.

Brian, Management Team, Service Properties Trust: Sure. I think in the last year plus we’ve been seeing the hotel portfolio decline year over year, which has pushed leverage up close to almost 10 times debt to EBITDA. With the hotel sales that we have in flight, assuming everything closes and we have all the proceeds in and repay the 26s and some of the other debt to round out the number, we think we’ll take a full turn off of leverage. Ideally, as we look forward to other strategies within the portfolio, whether it be EBITDA growth from the hotels or some other strategies we will look to deploy, we’d like to take another full turn off in the medium term horizon, sort of our medium term goal, but the shorter term goal is to buy us some cushion on not only leverage but also on the interest coverage which is another key metric for us as we look forward to where we are today. Okay.

Tyler Batory, Analyst, Oppenheimer: And then let’s tie in the dividends too and kind of talk about where you are right now, where you were and in your perspective what might need to happen or what sort of scenario might be necessary for there to be a larger dividend payment in the future?

Chris, Management Team, Service Properties Trust: Yeah, mean I think we’re paying a penny a quarter today, right? And part of that is just to kind of keep a dividend in place and that really kind of impacts favorably for kind of the overall investor pool within the organization. Certainly, we’re very mindful of the opportunity for a dividend, but I think the timing of that is still kind of in flux, right? I think we have a program that we need to get through, and I think getting on the other side of these dispositions, the deleveraging piece that we talked about, looking at where kind of EBITDA is going to trend on the hotel portfolio because that is an outsized catalyst for growth for the organization. I mean, know and we can kind of easily underwrite net lease retail just given kind of the embedded rent increases, but EBITDA fluctuates much more greatly on the hotel side, specifically around a lot of these renovations we’re doing.

So, you know, it’s certainly not going to be a ’25 initiative. I think there’ll be discussion around whether, you know, position where it makes sense to think about sometime later in ’26 or thereafter, but not to kind of misguide the timing, we’ve got some work to do around getting through what’s in front of us to really be in a position where we have better visibility into that.

Tyler Batory, Analyst, Oppenheimer: Okay, so we talked a lot about the transition in the hotel portfolio and one thing I don’t think we’ve really covered is just where CapEx is and CapEx savings, so just talk a little bit more about that aspect.

Brian, Management Team, Service Properties Trust: Sure, we’ve been deploying significant amount of CapEx in our hotel portfolio. We spent $300,000,000 in 2024 across a broad range of hotels, including our Hyatt Place portfolio as well as some Sonesta hotels. This year we’re projecting $250,000,000 of spend overall including maintenance CapEx, again across mostly Sonesta portfolio. As we’ve talked about to various folks, spend has been outsized, it’s been net cash outflow for the company, which is part of the decision on the dividend as well as leverage. But as we look forward to properties that we’ve been prioritizing for significant projects, we finished up a couple of airport hotels in Miami, LAX, Hilton Head Resort just came off a big renovation.

We have several projects lined up for this year that we’re excited about including our South Beach Hotel that we acquired a few years ago that we think will drive significant returns overall. Going forward I think we’ve messaged that incrementally CapEx will continue to normalize as we get past midyear twenty twenty six and into 2027. Our maintenance capital will come down from where it is today and hopefully we’ll get to a normalized run rate.

Tyler Batory, Analyst, Oppenheimer: So thinking a little bit more longer term about the company, what does SVC look like three years from now? I mean do you think you’re going to really fully more pivot towards a net lease or hotel and like as investors when we look at SVC, mean should we kind of still consider it more of a diversified REIT or do you want to be categorized as more of a net lease sort of a REIT or just how should we think about all that?

Chris, Management Team, Service Properties Trust: Yeah, I think kind of generally, I mean if you looked at kind of our Q1 results and pro form a to sales, more than 70% of our EBITDA is coming from net lease. So I think by way of overall valuation, I think valuation could be skewed more towards the net lease side. And certainly is an area where we’re focused for growth given the divestment of the hotels. I mean, again, the caveat to that is embedded EBITDA on the hotels, so there’s going to be some offset. But I think for the medium term, we’re going continue to be a diversified company.

I think for us, more specifically, while we’re growing on the net lease side, we also recognize that there’s a lot of value to be achieved through the hotel portfolio. And we want to kind of continue to work on that, drive performance, get the benefit of the capital we’ve already invested in and kind of just kind of keep things fluid. But there’s no plans at this stage outside of the current hotel divestment to do

Tyler Batory, Analyst, Oppenheimer: more. Okay, so I know a lot of investors also like to put companies in a box which right or wrong, I don’t need to go through that, but would you consider SVC to be a little bit more of a transition story, a little bit more of a delevering story, more of a growth story or just like how do you really want people, you know capital return story, like just how do you really want people to kind of think about your stock and really kind of get a sense of where you are in terms of some of those buckets?

Chris, Management Team, Service Properties Trust: It’s a tough question. It’s a little bit of everything, right? Mean it is a transition story and by any means if you look at our stock price it’s depressed, right? And I think kind of more broadly speaking getting through near term maturities, deleveraging the company, I think is top of mind for a lot of different groups. I think groups understanding kind of the overall value of the portfolio is a big piece.

I mean, you kind of sum the parts, looking at where the retail and the travel centers are, they would show that there’s some sort of this misconception on what the value of the hotel portfolio is, and getting through the transaction side are gonna kind of tease out comps, at least on the focused service side, and then inherently being a full service company on the hotel should show outsized valuations given the quality of those hotels. And I think now it’s a transition story, And I think there’s a transition story in our view with material upside on the equity, which would be the goal, and kind of narrowing the gap between the discount to NAV and it’s just kind of working through those steps to achieve that.

Tyler Batory, Analyst, Oppenheimer: Okay, perfect. So we do very good with time, we got ten seconds left. I think it’s a good place to wrap up. So appreciate everyone for joining us. Thank you

Chris, Management Team, Service Properties Trust: as All thank you.

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