The price of hotels rose in all regions except the Mid-Atlantic this quarter. Hotel prices in the Mountain and South Atlantic regions reached new statistical highs, while hotel prices in the Pacific region continued to remain above their statistical high. Hotels in non-gateway cities posted higher quarterly gains relative to gateway cities, as non-gateway prices increased 5 percent, compared to 3 percent for hotels in gateway cities. The transaction volume on all hotel transactions ((both large hotels and small hotels combined) surged 27 percent this quarter (61% year over year). Median prices also rose this quarter for both large and small hotels as well as hotels in non-gateway cities while hotels in gateway cities declined 23 percent. The prices of large and small hotels appear to be undervalued based on moving averages. However, the cost of hotel debt financing rose sharply this quarter, as well as year over year. Lenders are requiring relatively more compensation for hotel loans relative to other commercial real estate, and to the 10-year risk-free rate due to increased perceived risk. The rise in borrowing cost will dampen enthusiasm for undervalued hotel properties, since our EVA and SVA metrics indicate that the cost of borrowing exceeds the return for hotels.