Prepared remarks
Good day, and welcome to the Service Properties Trust Second Quarter 2026 Earnings Conference Call. All participants will be in a listen-only mode. After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded. I would now like to hand the call over to Kevin Barry, Senior Director of Investor Relations. Please go ahead.
Good morning. Thank you for joining us today. With me on the call are Christopher J. Bilotto, President and Chief Executive Officer, Jesse Abair, Vice President, and Brian E. Donley, Treasurer and Chief Financial Officer. In just a moment, they will provide details about our business and our performance for the second quarter of 2026, followed by a question-and-answer session with sell-side analysts. I would like to note that the recording and retransmission of today's conference call is prohibited without the prior written consent of the company. Also note that today's conference call contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 2000 and other securities laws. Forward-looking statements are based on SVC's beliefs and expectations as of today, August 6, 2026; actual results may differ materially from those that we project. The company undertakes no obligation to revise or publicly release the results of any revision to the forward-looking statements made in today's conference call. Additional information concerning factors that could cause those differences is contained in our filings with the Securities and Exchange Commission, which can be accessed from our website at svcreit.com or the SEC's website. Investors are cautioned not to place undue reliance upon any forward-looking statements. In addition, this call may contain non-GAAP financial measures, including normalized funds from operations or normalized FFO and adjusted EBITDAre. A reconciliation of these non-GAAP figures to net income is available in SVC's earnings release and presentation that we issued last night, which can be found on our website. Lastly, we will be providing guidance on this call, including estimated 2026 normalized FFO, hotel EBITDA, net operating income or NOI, and adjusted EBITDAre. We are not providing a reconciliation of these non-GAAP measures as part of our guidance because certain information required for such reconciliation is not available without unreasonable efforts or at all. I will now turn the call over to Christopher.
Thank you, Kevin. Good morning, everyone, and thank you for joining the call today. I will begin today's call with an update on our strategic priorities, and highlights from our hotel portfolio performance during the second quarter. Jesse will then discuss our net lease business, and Brian will conclude with a review of our financial results, balance sheet and outlook. Last night, we reported second quarter results that reflect continued momentum advancing SVC's strategic priorities and strengthening the company's financial profile. Our net lease portfolio delivered steady NOI growth, providing a highly predictable cash flow stream that anchors our portfolio. And within our hotel segment, RevPAR outperformed the industry benchmark for the seventh consecutive quarter. Overall, normalized FFO per share of $0.43 was in line with consensus expectations, and we are maintaining our full-year earnings guidance. Starting with our strategic priorities. We remain focused on enhancing our net lease portfolio, improving the cash flows and operating performance of our retained hotel portfolio, and further enhancing our balance sheet through disciplined capital allocation. Since the beginning of the second quarter, we have sold 20 properties for approximately $32 million, including 19 net lease assets and 1 hotel. A portion of these proceeds, combined with over $540 million of net proceeds from SVC's successful equity offering in April, was used to redeem $550 million of unsecured debt, reducing our leverage profile and decreasing annual interest expense while providing the company with enhanced flexibility to focus on operational execution and cash flow growth. Turning to hotel performance. Our retained hotel portfolio, excluding the 15 sales hotels, delivered another quarter of improved operating results. RevPAR increased 6.6% year over year with balanced growth in occupancy and ADR, and relative strength in full-service and upper-upscale hotels. RevPAR growth was partially offset by expected displacement related to our active redevelopment and renovation projects, most notably the Nautilus South Beach. Excluding the Nautilus short-term disruption, underlying RevPAR growth across the balance of the portfolio was meaningfully stronger at 9%, reinforcing our confidence in the improved fundamentals in our portfolio. The portfolio continued to benefit from completed renovations, a 22% lift in contract segment revenue, as well as rate-driven demand related to the World Cup and select host cities. Importantly, this positive momentum has carried into the third quarter with preliminary July RevPAR for our retained hotel portfolio of 7.1% year over year. Retained hotel EBITDA increased 4.2% this quarter, with notable strength at the Sonesta properties in Hilton Head and Miami Airport, as well as Radisson in Salt Lake City. To put this performance into context, our retained hotel portfolio generated a quarterly adjusted hotel EBITDA margin of approximately 19.4%. By comparison, the 15 hotels we are exiting operated at a negative EBITDA margin over that same period. This gap is the core economic logic behind our capital recycling strategy. Rather than continuing to dedicate capital and management attention to a cohort of assets with structurally negative returns, we are redirecting those resources toward a retained portfolio that is already demonstrating a clear trajectory of margin improvement. Building on this, we see significant additional opportunities for improved profitability across our retained hotel portfolio. Our asset management group continues to work with our operators on several opportunities to expand hotel EBITDA margins both at Sonesta and our other operators. These efforts are initially centered on three primary pillars. The first pillar relates to revenue optimization, targeting customer acquisition costs by driving more business to the direct and most profitable channels like brand.com and thereby reducing reliance on higher-cost OTAs. This also includes a continued focus on driving contract and group base, along with ancillary revenue streams such as food and beverage and parking. Second, in support of improved labor efficiency, our operators are implementing a leaner and more dynamic labor model to better align staffing with demand and reduce reliance on costly contract labor. Within the quarter, we are already seeing the benefits of this with Sonesta, Radisson and IHG all improving labor productivity year over year. The third pillar relates to capitalizing on operating leverage with anticipated savings from benefits plans, property insurance, and diligent controls over energy and utility costs. As our renovated hotels stabilize and occupancy grows, this will provide enhanced pricing power and position the property to capture additional event-driven demand, which in turn will absorb fixed costs more effectively, ultimately driving profitability. While early in the process, initial benefits are starting to materialize, including the positive trend with labor productivity, a recent 20% reduction in property insurance cost for our portfolio, which is notable, a 22% lift from contract revenue largely from new airline crew business, and the adoption of certain technologies and processes that will drive margin improvement. As these initiatives progress, we will provide further updates on targeted revenue and expense benefits. Beyond these initiatives, SVC is positioned to capture meaningful performance upside from the elimination of approximately $15 million of negative EBITDA drag from our exit hotels, the gradual burn off of displacement and corresponding performance growth from our hotel renovations, most notably the ongoing redevelopment of the Nautilus in Miami Beach. While these benefits will be realized over time, they provide a roadmap for improvement in hotel EBITDA and cash flow generation complementing our top-line initiatives focused on driving market share across the portfolio. Turning to our hotel dispositions. We remain on track to sell the previously disclosed 15 hotels, which included the sale of a 133-key hotel in July for $18.4 million. To date, we are under a purchase and sale agreement or letter of intent with 13 hotels and are marketing 1 hotel. We expect the majority of the remaining dispositions to be mostly completed over the balance of 2026 with proceeds continuing to support debt reduction to further improve our financial flexibility. As part of this process, we also intend to bring to market our remaining IHG-managed full-service hotel, a 495-key property located in the Atlanta perimeter submarket. As some may recall, we removed this asset from the marketing process last year while we evaluated varying strategies with the in-place agreement and capital outlook. This followed a comprehensive hold-versus-sell analysis undertaken as the hotel's management agreement approached its scheduled expiration. While the property has performed well operationally, we believe a sale represents the more attractive path to unlocking value for shareholders relative to continuing to own and reinvest in the asset. We expect marketing to commence in Q3 and look forward to providing future updates. Before I conclude, I would also like to briefly touch on corporate governance. As we previously announced, our Board continues to actively evaluate candidates for an additional independent trustee. The search remains focused on identifying an individual with meaningful hospitality industry experience who can further complement the board's experience and support SVC's ongoing strategic evolution. Looking ahead, our priorities remain clear: translate the operating momentum in our retained portfolio into sustained margin and cash flow improvement, while completing the exit of our non-core hotels to further strengthen SVC's financial profile. With a stronger balance sheet and the initiatives we have underway to further enhance performance, we believe SVC is well positioned to unlock value across the portfolio to drive long-term shareholder returns. I will now turn it over to Jesse to discuss the net lease portfolio in more detail.
Thank you, and good morning. Our net lease assets continue to serve as a dependable source of cash flow for us with minimal capital requirements, long-duration leases and a diversified tenant base. The portfolio exhibited strong performance in the second quarter, led by meaningful NOI growth, sustained leasing momentum and continued improvement in the performance of our travel centers. Highlights from the quarter include an increase of 2.2% in cash-basis NOI quarter over quarter as a result of contributions from recent acquisitions, contractual rent growth from our existing leases and a reduction in our credit reserves. Occupancy was unchanged from the prior quarter at 96.6%, although we expect to see incremental growth in occupancy throughout the remainder of the year given the current state of our leasing pipeline and our asset management team's dedicated efforts to efficiently dispose of vacant properties and cycle in new brands. Optimizing our portfolio and developing new operator relationships will be an ongoing focus for our team as we continue to transition SVC toward the net lease side of the business. The aggregate rent coverage of our portfolio improved to 2.09x on a trailing 12-month basis. The improvement was driven primarily by a 10-basis-point increase to 1.34x for TA. This is the second straight quarter of coverage growth for TA and represents a 12% increase since the fourth quarter of last year. For the balance of the portfolio, rent coverage again came in north of 3.5x as tenant credit quality and operating performance remained stable. On the leasing front, our asset management team executed deals totaling 210,000 square feet with a weighted average lease term of roughly 7 years. With just 1% of annualized base rent scheduled to expire through year-end, and 3.8% rolling through the end of 2027, our near-term expiration schedule remains very manageable. Our asset management team has been proactively engaging with tenants that have upcoming expirations to negotiate renewals. Turning to capital recycling. We continue to execute our measured growth strategy. On the acquisition side, year to date, we have invested approximately $9 million across 4 properties operating in the QSR and automotive services industries. These acquisitions were completed at weighted average cash and GAAP cap rates of 7.9% and 8.8%, respectively, and carried weighted average lease terms of approximately 15 years. We are under agreement on another 5 properties, a mix of dollar stores and casual dining concepts, for a total of $14.2 million which we expect to close in the third quarter. These transactions, funded through capital recycling, put us well ahead of schedule for our target of $25 million of annual acquisition activity. Since the beginning of the year, we have sold 21 properties for $15 million and we expect a similar level of dispositions during the second half of 2026. The net lease portfolio now consists of 745 properties with annualized base rent of nearly $400 million and a tenant roster that includes 185 businesses operating in more than 140 brands across a diverse range of industries led by travel centers, quick service restaurants, fitness centers, and grocery stores. More than 95% of our annualized base rent is derived from leases that contain contractual rent increases or percentage rent provisions, providing embedded NOI growth and inflation protection over time. As we work to reposition SVC toward a more net lease-oriented company, our focus will be on enhancing portfolio quality, maintaining strong occupancy and credit metrics, extending our WALT and generating durable cash flow growth. We believe our disciplined asset management and capital allocation strategies will ensure SVC's measured transition to a primarily net lease platform. With that, I will turn the call over to Brian to discuss our financial results.
Thank you, Jesse, and good morning. As we previously announced, SVC effected a 1-for-5 reverse share split in early July and all per-share information in our earnings report and 10-Q have been retroactively adjusted. Additionally, given SVC's recent equity issuance, comparing per-share data to prior periods is not meaningful. Starting with our consolidated financial results for the second quarter of 2026, normalized FFO was $55 million, down $2.6 million or 4.5% compared to the prior-year quarter. Normalized FFO this quarter as compared to the prior quarter was primarily impacted by a $20 million decline in hotel results largely from our hotel disposition activity, partially offset by a $15 million decline in interest expense and a $2.3 million increase in performance from our retained hotels and a $1.3 million increase in NOI from the net lease portfolio. Turning to our hotel portfolio performance. For our 93 comparable hotels this quarter, RevPAR increased by 6.5% and gross operating profit margin percentage declined by 60 basis points to 28.7%. Below the GOP line, costs at our comparable hotels increased by $3.5 million from the prior year driven primarily by higher insurance costs. Our 93 comparable hotels generated adjusted hotel EBITDA of $55 million during the quarter, which was relatively flat compared to the prior-year quarter. The 78 hotels in our retained portfolio generated RevPAR of $135, an increase of 6.6% year over year, and adjusted hotel EBITDA of $57 million during the quarter representing an increase of 4.2% year over year. Excluding the 3 hotels under renovation, hotel EBITDA increased $6.5 million or 13.4%. The Sonesta exit hotels, which we sold or are continuing to market for sale, produced losses of $1.9 million during this quarter, a decline in profitability of $2.2 million year over year. NOI from our net lease portfolio increased $1.3 million over the prior year as a result of our acquisition and leasing activity, partially offset by vacancies and credit losses. Turning to the balance sheet. We have been active in the capital markets and took steps to further strengthen our balance sheet, improve our debt maturity profile and our cash flow. During the quarter, we raised net proceeds of $542 million from our equity offering and redeemed all $450 million of our outstanding 5.5% senior guaranteed unsecured notes due 2027 and the remaining $100 million of outstanding 4.95% senior unsecured notes due 2027. This activity resulted in additional annual cash interest savings of $30 million. We currently have $4.7 billion of debt with a weighted average interest rate of 5.66%. As of today, there are no amounts outstanding on our $650 million revolving credit facility. This credit facility matures in June 2027, and we have a 1-year extension option available to us. Our $580 million of zero-coupon senior secured notes mature in September 2027 and they are supported by strong net lease collateral, which we believe provides refinancing optionality. Turning to our capital expenditure activity. During the second quarter, we reinvested $30.5 million in capital improvements, which continue to be driven by the renovation of the Nautilus in Miami as well as projects at the Royal Sonestas in Boston, New Orleans and Columbus. Turning to our annual guidance. We are reaffirming our full-year outlook for hotel EBITDA, net lease NOI and consolidated adjusted EBITDA. We are maintaining our normalized FFO range of $124 million to $144 million or $1.20 to $1.35 per share. The per-share amounts assume a weighted average share count of 105 million shares. This full-year guidance assumes midpoint expense of $360 million and G&A expense of $40 million. This guidance does not reflect the impact of completing the remaining Sonesta hotels planned for disposition and it continues to assume $25 million of capital recycling on our net lease portfolio. We continue to expect total CapEx for the year of $120 million to $140 million. Cash flow available for distribution was $42.5 million for the quarter and we continue to expect to generate positive CAD for the full year 2026. Operator, that concludes our prepared remarks. We are ready to open the line for questions.
Questions and answers
We will now begin the question-and-answer session. Our first question will come from Tyler Batory of Oppenheimer. Please go ahead.
Hey, good morning. Thanks for taking my questions. A few on the hotel portfolio first, and I am really focused on the retained hotels. Talk a little bit more about the renovation activity that, I believe, was impacting margin in Q2. And you talked about a number of initiatives to improve the margin performance at the retained hotels. Just talk through a little bit in terms of the timeline on when some of those initiatives might start to show up in the performance on the margin side of things. And then just remind us again where you would like to go in terms of moving margin in the retained hotel portfolio?
Hey, good morning, Tyler. This is Brian. I will start and Christopher will jump in with some of the more forward-looking stuff. Yes, for the 3 hotels we earmarked as under renovation, the biggest one is obviously the South Beach property, the Nautilus, which we have been talking about. Those hotels generated about $1 million of revenue this quarter, but it was a $3.3 million decline year over year. One of the three is an exit property, so it is a little bit of noise on both fronts. Nautilus is projected to be completed by the end of October or early November with some phased completions of rooms and public space. That is our biggest project for the year; it has a lot of financial impacts on both the RevPAR top line and the bottom line. Q1 and Q2 is the high season for Miami, so that was a particular drag in our results. But as we look forward to Q4, we should see a positive uplift from that property among others. Some of the other properties under renovation or that recently completed renovation have also started ramping up — Simply Suites in Las Vegas, for example. We are doing Royal Sonesta Market Cambridge in New Orleans. There is still a bit of noise and moving pieces.
I would just add that this is iterative. This is a broader strategy, in line with what we have talked about coming into the year and over, even into Q1. Some of the small wins: we have reduced our property insurance by 20%, effective July 1, which is a fiscal-year benefit and includes some benefits coming from reduced deductibles, so we would expect less overall cost. The insurance premium alone is a couple of million dollars for the fiscal year. We are starting to see the inflow of other types of ancillary revenue alongside contract business, so those are near-term initiatives. The bigger piece is the work being done with our operators. There is a new management team that started effective August 1, and giving them room and runway to really dig in and unpack opportunities in the portfolio is something they have been focused on; many of our strategies are tied to that. We would expect more of that to flow through toward the end of the year and more meaningful items like benefits to show up in Q1 of next year. The idea is that we will provide more specific numbers tied to these levers after we have given them the needed time to vet through them — potentially as early as the next quarter. Another highlight is that by selling these assets we remove negative $15 million of EBITDA drag; that is addition by subtraction. In our guidance, we have $12 million of this displacement occurring with these renovations. Getting that back gets you to zero, let alone the uplift when performance turns around. When you start to add up these numbers, they become very material, and I expect them to fold in and ramp up specifically as we get into 2027.
Okay. Great. And to follow up on the RevPAR side of things, we thought Q2 was really strong, but you kept the full-year guidance range. So just talk about the outlook for the rest of the year. I am not sure if that is renovation activity or anything else impacting that outlook, but curious if there is any extra conservatism in terms of what you are providing for what is implied for the second half of the year?
Sure, Tyler. Thank you. From our standpoint, Q2 was definitely strong. We have seen our preliminary July results, which gives us some optimism going into the third quarter. But if you look at our portfolio and the seasonality of it, we do expect a slowdown in the back half of August and then into Q4; it's just the way our portfolio trends in some of our geographies. We feel comfortable with the guidance range as we sit here today. There are a lot of moving pieces in motion as we look to the back half of the year. As Chris outlined, the disposition activity and the potential timing of some of that could affect our numbers — hopefully to the upside.
Okay. And then last question from me on the asset sales. Remind us of the timeline there — I think in prepared remarks you said by the end of 2026 — but any execution risk in terms of getting those completed? And then a bigger-picture question: talk a little bit about the market overall for asset sales and help us think through any updated thoughts in terms of future assets that might be on the market for sale. I know you are now marketing that Atlanta asset. Is there anything else in the portfolio that might make sense down the road?
First, with respect to the 15 properties we have been active with, we are mostly under contract. It is really a Q3–Q4 execution. Of the quantum, which is just shy of $100 million representing that bucket of under contract assets, maybe between $20 million and $30 million might transact in Q3 with the balance in Q4. There is one that we are marketing that might find its way into early 2027. With respect to the Atlanta perimeter, given where we are in the process, it is fair to say that early 2027 is a reasonable expectation depending on where pricing comes in. More broadly, our plan continues to be to dig into each hotel and figure out where we can optimize performance. This is a multi-year journey. What we are selling this year and the introduction of the Atlanta hotel to the market is a testament to how we think about timing. Driving performance to drive value is a big part of our business, and we will adhere to that. The broader market is mixed. Focused-service hotels have continued to see some strength given price point. For more luxury hotels, there seems to be capital chasing those concepts. In between, depending on price point — say $50 to $100 million — it is a little softer. That doesn't mean there isn't an ability to transact, but most transactions are coming from more stabilized hotels versus assets that are on a performance turnaround journey like many of ours.
Great. Very helpful. That's all for me. Thank you.
The next question will come from Jack Armstrong of Wells Fargo. Please go ahead.
Hey, good morning and thanks for taking the question. Can you provide us with your updated thoughts on the ramp for the Nautilus? When you expect it to open? What the EBITDA drag is in the third and fourth quarters? And then where you expect the asset to stabilize and the pathway to get there?
Sure, Jack. The Nautilus project is underway today. We expect delivery by November, just ahead of where the season starts ramping up for that market. From a cash-drag standpoint, for the full year it is around $4.5 million for that property. So it is a significant swing in our expectations going forward as it ramps up. We will obviously give more color when we get into next year's guidance. The property did around $5 million or $6 million on an annual run rate before renovation. We expect that to significantly increase going forward. Between that property and some of the others that are still ramping, we are optimistic we will continue to see the right results.
Helpful color there. Can you touch on what percentage of your bookings were through OTAs in Q2, then maybe where that has been historically and what the goal is going forward, given some of the initiatives you talked about?
The bookings through OTAs have hovered in the mid-20 percent range. Where that bogey needs to be is still to be determined, but certainly we want that to come down closer to 20%. It will take a lot of work: allocating more resources to growing loyalty programs and driving business to brand channels, bolstering group and contract business, and driving transient direct bookings. Between 20% and 25% is a healthy medium-term expectation, and we expect progress as we implement the initiatives I referenced.
And then maybe one on the net lease side. Can you give us your updated thoughts on credit losses in the back half of the year? Maybe provide an update on where the two franchisee bankruptcies stand and any changes to your watch list in the first quarter?
Yes, Jack. With respect to the two bankruptcies we announced last quarter, good news on both fronts. The Popeyes franchisee will be emerging from bankruptcy in Q3. We have a deal in place to assign those assets back to corporate, so there will be a credit bump there. All remaining economics of those existing master leases will stay the same, so they are already back to a rent-paying status. Net, that is a positive story. With respect to the other franchisee, another QSR, we expect all of those to remain open and get assigned to corporate as well, so we will see that credit bump. We are still negotiating deal terms regarding exactly how it is going to play out in terms of rent going forward. The big story on the net lease side relates to the TA coverage piece; this is the second straight quarter we have seen a meaningful bump. We think this is probably a function of a few things: double-digit growth in freight pricing, improved diesel margins, and possibly early fruits of the business improvement plan that BP has implemented for those TA assets. Freight-related increases feel more persistent into 2026, and diesel margins are somewhat transitory given geopolitical risks, but overall it is a positive indicator for that business. Multifactorial, but the big news in terms of how we think of the net lease portfolio was driven by the increased performance in TA.
The next question comes from Floris Van Dijkum of Ladenburg Thalmann. Please go ahead.
Hey, good morning. I'm on for Floris. Thank you for taking the questions. Can you walk us through your current thinking on addressing the remaining 2027 debt maturities, especially around the timing for that debt? Thanks.
Sure. From our standpoint, we have $45 million in lease mortgage notes, a variable funding note coming up in January. We expect to take that out with asset sale proceeds. I mentioned the revolver is up in June; we do have a 1-year extension option. We are planning around that in the coming months. The zero-coupon senior secured notes mature in September 2027. The back half of this year and early next year is probably when we will consider transacting, depending on market conditions. Those notes are backed by two of our travel center lease pools, so very strong collateral. We think we have flexibility in refinancing those notes, and whether or not we pay some of it down with asset proceeds remains to be seen depending on the quantum.
The next question comes from John Massocca of B. Riley. Please go ahead.
Good morning. Maybe sticking with the balance sheet question and the zero-coupon bonds in particular: do you think where you sit today after the equity raise you are in a good enough position from a covenant perspective to refinance those with a more traditional secured debt? Or would you still probably, for covenant-related reasons, need to go with a more unique angle like you did with the last debt raising?
John, thanks for the question and good morning. Our current thinking is that it will most likely be a regular-way type debt instrument. The zero-coupon was a temporary need from a covenant standpoint pre-equity raise. As we sit here today and given how those bonds have traded, I think we will be in a pretty good position to be able to do that and absorb the cash interest expected with such a refinancing. Those bonds have traded well in the market; the collateral is very strong, which sets us up in a good spot.
Okay. And then on the hotel front, with the two assets that you are marketing but do not have pricing agreed to or under contract on, are there brackets of proceeds you are looking for? I know it might be specific given it's only two assets, but curious if there is a range of proceeds we might expect from those dispositions.
We will provide more color as time progresses. We want to let the process play out and let that guide overall expectations. We believe allowing the market to set the price via a marketing process is appropriate, and we will provide updates as bids and negotiations progress.
Okay. And then with the Atlanta asset, you previously marketed it. Was it the operational position of the property that made it attractive to reintroduce for sale? It seems like it did pretty well last quarter. Has there been a change in overall performance that makes it more attractive to buyers, or what changed that made you take it back to market?
Last year, when we took it to market, there were a couple of factors. One was unpacking the capital needs and the overall situation with the brand. We wanted to rethink the strategy. As we sit here today, what is attractive is that the management agreement expires at the beginning of next year, which provides optionality for the buyer pool whether they purchase with or without the brand. That gives flexibility on execution depending on a buyer's business plan and capital needs. From a timing standpoint, relative to market windows and those contractual time frames, we view it as a more attractive candidate for a buyer today.
Okay. And then bigger picture as we look into 2027, should we expect hotel sales to be one-off in nature, or might there be a more portfolio-driven or structured disposition program next year?
It is early, John. The real focus remains on performance improvement; that is our priority and is a journey. We will let that guide how we think about dispositions. As we get through the year and more specifically into 2027, we will have more color on what that could look like.
Just to clarify, the 7.1% July RevPAR growth referenced earlier was for the retained assets.
Lastly, on the net lease side: how should we think about lease expirations over the remainder of the year? Are those strong candidates for renewal or how are you thinking about those assets typically?
We do not have a ton of expirations in the back half of the year. We have our arms around most of them and expect to be reviewing the vast majority; there may be one or two that go dark, but even that would be somewhat of a surprise. So I think we are in good shape for the balance of 2026 and are now trying to get ahead of 2027 as well with the team.
Okay. That's it for me. Thank you very much.
This concludes our question-and-answer session. I would now like to turn the call over to Christopher J. Bilotto, President and Chief Executive Officer, for any closing remarks.
Thank you for joining today's call. Please reach out to our Investor Relations if you are interested in scheduling a meeting with SVC.
That concludes our call. The conference has now concluded. Thank you for attending today's presentation and you may now disconnect.