Host Hotels & Resorts, Inc. (NYSE:HST) Q1 2018 Earnings Conference Call Transcript

May 03, 2018 • 10:00 am ET

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Host Hotels & Resorts, Inc. (NYSE:HST) Q1 2018 Earnings Conference Call Transcript

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Q & A
Operator
Operator

(Operator Instructions) And first from Barclays, we'll hear from Anthony Powell.

Analyst
Anthony F. Powell

Hi. Good morning, everyone.

Executive
James F. Risoleo

Good morning, Anthony.

Executive
Michael D. Bluhm

Good morning.

Analyst
Anthony F. Powell

Good morning. Could you talk about your capital allocation priorities for the rest of the year, are you seeing attractive acquisition opportunities in the market? And given the increase in merger activity in the space in recent years, are public company acquisitions a more realistic possibility for you right now?

Executive
James F. Risoleo

That's a multiple point -- a multiple part question, Anthony, let me break it down a little bit for you as I answer it. First of all, I would tell you that we're not seeing a large amount of individual or portfolio acquisition opportunities that fit our profile. And when I say fit our profile, I'm not only talking about the nature of the asset, but I'm talking about the disciplined way in which we underwrite these potential investment opportunities.

So that's one of the reasons why we didn't include any additional acquisitions in our guidance for the balance of the year. Of course, we're still looking at opportunities as they present themselves, and we're trying to get out ahead of the pack and bring to bear the attributes of the Company and our scale and our access to information, and the fact that we do have an investment grade balance sheet as opportunities present themselves.

On the M&A front, I would say that, as I've said in the past, we are very open-minded and we evaluate all opportunities to enhance NAV, and we'll continue to think about our strategy in that context going forward.

Analyst
Anthony F. Powell

Great. Thank you.

Operator
Operator

Next question will come from Chris Woronka with Deutsche Bank.

Analyst
Chris Woronka

Hey. Good morning, guys.

Executive
James F. Risoleo

Good morning, Chris.

Analyst
Chris Woronka

Good morning. I wanted to ask about some of the changes that have come into play recently with some of the cancellation policies, I guess, both Marriott and Hilton, and are you -- do you think those are beginning to have a more sustainable positive impact on rate growth and revenue management, given that the booking window has continued to extend out?

Executive
James F. Risoleo

We're very pleased with the implementation of the new cancellation policies. We have seen a -- clearly, have seen a difference in booking patterns at the hotels. And most importantly, we're delighted that our property managers are enforcing the policies. We saw an uptick in cancellation fees in quarter one. It wasn't across the portfolio, it really dealt with the groups at five different hotels. But to be able to collect cancellation fees from groups, that is really something new and we're also seeing it happen with the transient customer as well.

Analyst
Chris Woronka

Great. Great, very good. Thanks, Jim.

Operator
Operator

Next from BTIG, we'll hear from Jim Sullivan.

Analyst
Jim Sullivan

Good morning, guys.

Executive
James F. Risoleo

Hey, Jim.

Analyst
Jim Sullivan

Jim, I wonder if you could comment about New York; the results were pretty decent in the quarter. And kind of two-part question here, what's your outlook for the balance of the year in that market? And secondly, in connection with that, do