Operator: Our next question is from Patrick Scholes with Truist Securities.
Charles Scholes: Give a little bit more color on the strength in groups. What changes have you seen as far as the composition of these groups and related to that propensity or lack of propensity, but it sounds like it’s propensity to spend outside of the room. What types of groups are sort of shipping in and what are being shifted out?
Sean Dell’Orto: Yes, Patrick, it’s Sean. I think you’re continuing to see, I think, for one, groups are getting bigger as we kind of naturally thought as we came out of the pandemic, we started with the small groups and now gone to larger in-house groups. You now got to the point where convention is, I think, the leader in the clubhouse as we look at this year in terms of growth. We’ve talked a lot about the convention calenders being in our favor in a lot of our markets with Chicago, up strong 65%; D.C., up almost 50%; Honolulu is up 30% and so down the line between New Orleans and San Diego and other markets are also kind of either flat or slightly up to about 20% up. So again, all across the board, I think we’re seeing convention being much stronger in this.
So I think it’s leading to larger certainly room blocks for us. I think corporate remain strong through this year. And I think that certainly leads itself to, again, just getting bigger and they’re outperforming. We’re seeing revals up. I think that’s contributed to some of the strength we’ve seen in January and February. So more are showing up than we anticipated, and that’s leading to better certainly F&B spend. I would say the characteristics, I think kind of leading aside from just the size of them getting larger. I think it’s just more getting into more traditional, what it professional technology, the kind of the more traditional groups we’ve had in the past are kind of coming back. And importantly, too, is if you think about some of the success recently here as we’re picking up things like Tom had just briefly mentioned, but Apple has been a big contributor now in the short-term pickup in our market out in the Bay Area.
So it’s been encouraging to see a place like Cupertino, and our Juniper Cupertino and then to some extent, San Jose picking up some short-term group business as I think these technology firms are coming back more and bringing people back to the office and bringing people together to kind of train and kind of ultimately get back to normal business.
Thomas Baltimore: Patrick, the other thing — the one thing that I would just add, I agree with everything that Sean outlined, but just the natural need to bring your people together, whether that’s for training, whether that’s for celebration, you got to think this is a — it sort of makes sense. Everybody was sort of focused initially on pent-up demand and leisure, but as you’re getting back people back in the office, they need to be together. And what’s really pleasing to see is that we all expected it, but we’re beginning to see it accelerate and it’s broad-based. And citywide is obviously being the leader in the clubhouse here, but you’re also seeing it on the group side, the in-house group side. So very, very encouraging as we look out.
Charles Scholes: And my follow-up question actually has to do with booking out. Any initial observations or perhaps statistics that you can give on how ’25 is pacing at this point?
Thomas Baltimore: Yes. I would just say ’25 group pace is about 97% of 2019 levels as we look out right now and with rate very strong increase in rate, near double-digit increase in rate.
Sean Dell’Orto: I would say 10% right now.
Charles Scholes: You say pace, just to be clear, that’s a revenue pace for next year versus 2024, 10%?
Sean Dell’Orto: Yes. You look out at the same time, same kind of time frame for 2025, you’re up 10% for revenue base, yes.
Operator: Our next question is from Duane Pfennigwerth with Evercore ISI.
Duane Pfennigwerth: On group revenue pace, I just wanted to try and ask the question in a different way. What percentage of the group revenue that you expect to generate this year is on the books? And if you have it, how does that percentage compare to this time last year into 2023?
Sean Dell’Orto: Duane, I would say the — what we have relative to forecast, 78% is relative to what we have forecasted on the books already. That compares to 74% last year. As you think of the first half of this year right now, we’re 90% booked for what we’re expecting for the first half of this year.
Duane Pfennigwerth: That’s super helpful. And then just Hawaii, I guess, a longer-term question. It’s obviously off to a strong start. I think you’ve commented in the past like expectations for the year. How should we be thinking about Hawaii in its entirety for the year?
Thomas Baltimore: We said in our prepared remarks sort of low single-digits for Hawaii. Just given as Sean noted, obviously, we’ve got the — coming off of a strong year, but we’ve got the renovation, obviously, in the back half of the year. Now we’re up 10%. And so far, it’s doing well, but we clearly would guide you more to that low single-digits as we think about for the year.
Operator: Our next question is from Dori Kesten with Wells Fargo.
Dori Kesten: I know you just laid out your ’24 CapEx plans, but can you give us a sense of what’s on deck for ’25? And just should we be considering ’25 a year still with net renovation tailwinds?
Thomas Baltimore: Yes. It’s a great question. Obviously, we began Rainbow Tower, obviously, a key tower in Hawaii, expect to finish that next year, sort of in the queue as we’re working on Royal Palm, obviously, in Miami and South Beach, Bullseye real estate, about 393 keys. So our design and construction team are working on another transformative renovation for certainly that asset. Santa Barbara is another one that we’re working with our partner, adding potentially going through the entitlement process, but adding another 80 keys there as we look out and clearly, continuing the renovation on New Orleans, but also be in the queue as well. So just few of the assets, but we are really focused, Dori, laser focused on spending money where we’re making money. And you can see already the benefits that we’re getting and really, we think candidly better than acquisition yields and what we can get in the marketplace.
