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InduSTRy Overview
Brittany Baldwin Director of Business Development, Destinations
SOVA Meeting Symposium- March 5, 2012
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www.hotelnewsnow.com Click on “Hotel Data Presentations”
3
Agenda :
• Total U.S. Review
• Oregon & Neighbors
• Oregon Area Market
• Submarkets
• Pipeline
• Forecast
4
2011: The World Recovered
Markets with Positive REVPAR % Change
Americas: 194 of 212
Europe: 84 of 98 Asia Pac: 38 of 47
Middle East / Africa: 19 of 33
*RevPAR in local currency Source: STR Global
5
Total US Review
6
Supply / Demand Imbalance Drove 2011 Results
% Change
• Room Supply* 1.8 bn 0.6%
• Room Demand* 1.06 bn 5.0%
• Occupancy 60.1% 4.4%
• ADR $102 3.7%
• RevPAR $61 8.2%
• Room Revenue* $108 bn 8.8%
Full Year 2011 Total US Results * All Time High
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On An Annualized Basis: Most Rooms Sold - EVER
0.7
0.8
0.9
1.0
1989 1994 1999 2004 2009
Bill
ion
s
Total U.S. Number of Rooms Sold, 12 MMA, 1/89 – 12/11
8
-9
-6
-3
0
3
6
9
1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011
Supply Demand
Strongest Demand Rebound Ever. Supply Line Turning
-6.9%
-0.9%
- 4.7%
Total US, Supply & Demand % Change, 12 MMA 1/89 – 12/11
9
-12
-9
-6
-3
0
3
6
9
1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011
ADR Demand
ADR Changes Got More Erratic in Each Downturn
-8.6%
-0.1%
- 4.5%
Total US, ADR & Demand % Change, 12 MMA, 1/89 – 12/11
10
ADR Discounting at Twice The Speed of ADR Increases
95
100
105
110
2008 2009 2010 2011
*Total US, ADR $, 12 MMA 2007 - 2011
Apr ‘10 $97
Sept ‘08 $108
Dec ‘11 $102
+4.6%
-10%
19 Months
19 Months
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2000 2002 2004 2006 2008 2010 2012F
Nominal ADR
2000 / 2007 Grown by CPI
2000 ADR Grown By CPI
* Total US, ADR $ and Inflation Adjusted ADR $, 2000 – 2013F 2000 – 2010 CPI from bls.gov, 2011 – 2013 CPI from Blue Chip Economic Indicators
$85
$101
$104
$85
$107 $109
$107
$117
2013F
Inflation Adjusted ADRs Well Out Of Reach
2007 ADR Grown By CPI
12
U.S. Chain Scales
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• Luxury – Fairmont, Four Seasons, Ritz Carlton, JW Marriott
• Upper Upscale – Sheraton, Embassy Suites, Hyatt, Marriott
• Upscale – Radisson, Hilton Garden Inn, Residence Inn, Springhill Suites, Homewood Suites, Courtyard, Best Western Premier
• Upper Midscale – Fairfield Inn/Suites, Holiday Inn, Clarion, Hampton Inn/Suites, Best Western PLUS, Country Inn & Suites
• Midscale –, Best Western, Candlewood Suites, Quality Inn/Suites
• Economy – Extended Stay America, Red Roof, Days Inn, Microtel
2012 STR Chain Scales
14
Demand Recovery Strongest At Upper End
269
437
315
436
Luxury/Upper Up/Upscale UpperMid/Midscale/Economy
2007 2011
*Total Room Demand in Millions, by Combined Scales, 2007 & 2011
15
No Surprise Here: Room Revenue Grows At Upper End As Well
42
33
45
32
Luxury/Upper Up/Upscale UpperMid/Midscale/Economy
2007 2011
*Total Room Revenue in Billions $, by Combined Scales, 2007 / 2011
16
Do You Really Know Your Competitors?
National Nameback %:
45%
* % of hotels that use hotels in their compset which have named them Source: STR Analytics
17
Segmentation Review
18
Transient Demand Breaks Records, But....
10
12.5
15
17.5
20
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2007 2010 2011
*Transient Demand in Millions of Rooms; 2007, 2010, 2011 Data is for upper tier hotels only (LUX & UU chains, & Upper Tier independents)
Mill
ion
s
19
… Transient ADR Still Lags 2007 Results
$140
$150
$160
$170
$180
$190
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2007 2010 2011
*Transient ADR $, 2007, 2010, 2011 Data is for upper tier hotels only (LUX & UU chains, & Upper Tier independents)
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Group Demand Has Not Changed Over Time, But…
4
6
8
10
12
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Millio
ns
2007 2010 2011
*Group Demand in Millions of Rooms, 2007, 2010, 2011 Data is for upper tier hotels only (LUX & UU chains, & Upper Tier independents)
21
… Group ADR Does Not Increase (& Could Depress Future Absolute ADRs)
$130
$140
$150
$160
$170
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2008 2010 2011
*Group ADR $, 2008, 2010, 2011 Data is for upper tier hotels only (LUX & UU chains, & Upper Tier independents)
22
Oregon & Neighbors
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YE 2011 – All Regions Recovered
Occupancy: ▲ 4.5 % ADR: ▲ 5.5 %
RevPAR: ▲ 10.3 %
Occupancy: ▲ 5 % ADR: ▲ 3.3 %
RevPAR: ▲ 8.4 %
Occupancy: ▲ 2.6 % ADR: ▲ 3.8 %
RevPAR: ▲ 6.5 %
Occupancy: ▲ 5.5 % ADR: ▲ 2.8 %
RevPAR: ▲ 8.5 %
Occupancy: ▲ 5.1 % ADR: ▲ 3.2 %
RevPAR: ▲ 8.4 %
Occupancy: ▲ 2.9 % ADR: ▲ 2.7 %
RevPAR: ▲ 5.7 %
Occupancy: ▲ 4.2 % ADR: ▲ 2.7 %
RevPAR: ▲ 7 %
Occupancy: ▲ 3.5 % ADR: ▲ 4.4 %
RevPAR: ▲ 8.1 %
Occupancy: ▲ 5.2% ADR: ▲ 3.2 %
RevPAR: ▲ 8.6 %
TOTAL US
Occupancy: ▲ 4.4 %
ADR: ▲ 3.7 %
RevPAR: ▲ 8.2 %
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January 2012- Strong RevPAR Growth For Most
Occupancy: ▲ 3.6 % ADR: ▲ 5.2 %
RevPAR: ▲ 8.9 %
Occupancy: -2.2 % ADR: ▲ 4.9 %
RevPAR: ▲ 2.7 %
Occupancy: ▲ 4.5 % ADR: ▲ 4.5 %
RevPAR: ▲ 9.3 %
Occupancy: ▲ 6 % ADR: ▲ 5.9 %
RevPAR: ▲ 12.2 %
Occupancy: ▲ 7.9 % ADR: ▲ 4.7 %
RevPAR: ▲ 13 %
Occupancy: ▲ 5.2 % ADR: ▲ 2.4 %
RevPAR: ▲ 7.6 %
Occupancy: ▲ 4.4 % ADR: ▲ 3.6 %
RevPAR: ▲ 8.1 %
Occupancy: ▲ 4.1 % ADR: ▲ 0.3 %
RevPAR: ▲ 4.4 %
Occupancy: ▲ 6.8% ADR: ▲ 4.3 %
RevPAR: ▲ 11.3 %
TOTAL US
Occupancy: ▲ 4.1 %
ADR: ▲ 3.9 %
RevPAR: ▲ 8.1 %
25
Idaho RevPAR; Nevada Occupancy???
January 2012
Occupancy: ▲ 4 % ADR: ▲ 3.5 %
RevPAR: ▲ 7.6 %
Occupancy: ▲ 1.2 % ADR: ▲ 2.7 %
RevPAR: ▲ 3.9 %
Occupancy: ▲ 3.4 % ADR: ▲ 4.2 %
RevPAR: ▲ 7.7 %
Occupancy: -5.6 % ADR: ▲ 8.5 %
RevPAR: ▲ 2.4 %
Occupancy: ▲ 5.2 % ADR: ▲ 3.4 %
RevPAR: ▲ 8.8 %
26
Oregon Area Market
27
28
Oregon Area Seeing Declines for 2012 ?
% Change
• # of Hotels 646
• Hotel Rooms 38,631
• Occupancy 33.8% -2.9%
• ADR $74.06 0.3%
• RevPAR $25.06 -2.7%
• Room Revenue $ 30M -2.0%
Oregon Area Market- Key Statistics January 2012
29
Large Demand Spike for 2011
-10.0
-5.0
0.0
5.0
10.0
2007 2008 2009 2010 2011 2012
Supply % Change Demand % Change
Oregon Area Mkt, Supply & Demand% Change, 12 MMA, 01/07– 12/11
-7.1%
5.3%
30
-15
-10
-5
0
5
10
15
2007 2009 2011
ADR OCC
-9%
5.3%
7.5%
Rate Not Affected As Badly As Total U.S.
Oregon Area Mkt , ADR & Occupancy % Change, 12 MMA, 2007 – 12/11
31
Weekday/Weekend & Segmentation
Weekday = Sunday – Thursday Weekend = Friday & Saturday
32
30
40
50
60
70
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2008 2009 2010 2011
Weekday Occupancy: Not The Best
Oregon Area Market Weekday Occupancy by Month, Jan’08 – Jan’12
Jan 32.4 %
33
$70
$80
$90
$100
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2008 2009 2010 2011
Jan $73.33
Weekday ADR: Average Rate Increase of $1
Oregon Area Market Weekday ADR by Month, Jan’08 – Jan’12
34
35
45
55
65
75
85
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2008 2009 2010 2011
Jan 37.9 %
Weekend Occupancy: On Par With Prior Years
Oregon Area Mkt Weekend Occupancy by Month, Jan’08 – Jan’12
35
$70
$80
$90
$100
$110
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2008 2009 2010 2011
Jan $75.85
Weekend ADR: Good Start
Oregon Area Market Weekend ADR by Month, Jan’08 – Jan’12
36
Transient Demand Holding Steady….
-25
-15
-5
5
15
25
35
2007 2008 2009 2010 2011 2012
Trans. Demand % Chg Trans. ADR % Chg
Oregon Area Market: Transient Room Demand & ADR % Change By Month Jan. 2006 – Jan 2012
37
Different Story On The Group Side
-40
-30
-20
-10
0
10
20
30
2007 2008 2009 2010 2011 2012
Group Demand % Chg Group ADR % Chg
Oregon Area Market: Group Room Demand & ADR % Change By Month Jan. 2006 –Jan 2012
38
Oregon Area Submarkets
39
1.9
1.0
2.9
1.6
0.1
-0.3
1.7
0.0
0.4
-0.2
1.9
-0.4 -0.3
2.2
3.3
-0.6
YE 2009 YE 2010 YE 2011 Jan-12
Eugene Seeing the Supply Growth
Supply % Chng vs. LY for Oregon Area Mkt & Submkts YE 2009 – 2011; January 2012
40
-5.3 -4.9
-8.7
-1.4
3.1 3.8
5.1
6.2
0.3 0.9
1.6
-0.6
0.0
-14.4
-0.8
2.1
YE 2009 YE 2010 YE 2011 Jan-12
Oregon East Demand Drop Off…
Demand % Chng vs. LY for Oregon Area Mkt & Submkts YE 2009 – 2011; January 2012
41
-6.2 -5.8
-11.3
-3.0
3.7 4.2 3.4
6.2
-0.6
1.2
-0.3 -0.2
0.0
-16.2
-4.0
2.7
YE 2009 YE 2010 YE 2011 Jan-12
Explaining Double Digit Decline in OCC
OCC % Chng vs. LY for Oregon Area Mkt & Submkts YE 2009 – 2011; January 2012
42
2.9
-1.6
-7.0
-1.5
0.9
0.3
-1.0 -0.2
0.7
2.1
3.4
1.4
-0.4
3.8
-5.1
1.4
YE 2009 YE 2010 YE 2011 Jan-12
East OCC Decline, But Rate Grows …
ADR % Chng vs. LY for Oregon Area Mkt & Submkts YE 2009 – 2011; January 2012
43
-3.4
-7.4
-17.5
-4.4
4.6 4.4
2.3
5.9
0.1
3.2 3.1 1.2
-0.4
-13.0
-8.9
4.1
YE 2009 YE 2010 YE 2011 Jan-12
Medford Only Region w/RevPAR Growth
RevPAR % Chng vs. LY for Oregon Area Mkt & Submkts YE 2009 – 2011; January 2012
44
Pipeline
45
Pipeline Definitions:
In Construction: Ground broken or bids on general contractor being made
Final Planning: project out for bids, or construction to start within 4 months Planning: An architect/engineer selected & plans are underway. (Initial approvals have usually been granted) Pre-Planning: No architect has been selected
46
Total Oregon Active Development Pipeline
Phase Projects
(January 2012)
In Construction 2
Final Planning 4
Planning 6
Active Pipeline 12
Pre-Planning 2
Total 14
47
Oregon Area Market Active Development Pipeline
Phase Projects
(January 2012)
In Construction 2
Final Planning 1
Planning 5
Active Pipeline 8
Pre-Planning 2
Total 10
48
Oregon Area Market Top 3 Largest Projects - Active Pipeline
Project Name Tract Name Project Phase Room Count
Unnamed Hotel
Oregon West Area
Planning
100
Candlewood Suites Salem
Oregon West Area
Planning
89
Hampton Inn & Suites Astoria Oregon West Area In Construction
87
49
2012 / 2013 Forecast
50
Rooms Pipeline Still Not An Issue in 2012
Phase Dec 2011 Dec 2010 Dec 2007
In Construction 54 52 211
“Planned Pipeline” 254 265 204
Active Pipeline 308 317 415
*Total US Pipeline, in ‘000s of rooms, by Phase by Year Planned Pipeline includes projects in Final Planning and Planning phases Source: STR / McGraw-Hill Construction Dodge
51
Total United States Forecast 2012 / 2013 Key Performance Indicator % Change
2012 Forecast
2013 Forecast
Supply 0.8% 1.4%
Demand 1.3% 2.0%
Occupancy 0.5% 0.5%
ADR 3.8% 4.4%
RevPAR 4.3% 4.9%
52
Total United States Chain Scale Key Performance Indicator Outlook 2012F by Chain Scale
Chain Scale Occupancy
(% chg) ADR
(% chg) RevPAR (%chg)
Luxury 2.7% 4.7% 7.4%
Upper Upscale 0.1% 3.5% 3.6%
Upscale 2.0% 4.5% 6.6%
Upper Midscale -0.3% 3.7% 3.4%
Midscale 1.0% 0.8% 1.8%
Economy 0.7% 2.4% 3.1%
Independent -0.3% 3.4% 3.1%
Total United States 0.5% 3.8% 4.3%
53
2012 Year End RevPAR Forecast (as of 3rd QTR 2011 forecast)
-5% to 0% 0% to 5% 5% to 10% 10% to 15%
Nashville St Louis
Los Angeles-Long Beach Miami-Hialeah
Philadelphia Detroit
Anaheim-Santa Ana Boston
Orlando Minneapolis-St Paul
Washington DC New Orleans
Atlanta San Diego
Norfolk-Virginia Beach Oahu Island
Tampa-St Petersburg
Seattle
Phoenix
Houston
Dallas
San Francisco-San Mateo
Chicago
New York
Denver
54
Top 10 US Market Performance Forecasted Occupancy/ADR % Change 2012
Occ. % change
AD
R %
chan
ge
-8
-6
-4
-2
0
2
4
6
8
-8 -6 -4 -2 0 2 4 6 8
Los Angeles-Long Beach, CA
San Francisco/San Mateo, CA
Washington, DC-MD-VA
Miami-Hialeah, FL
Orlando, FL
Atlanta, GA
Chicago, IL
Boston, MA
New York, NY
Dallas, TX
55
Oregon Area Market
Forecast
2010 YE 2011 YE 2012 F
Occupancy 4.4 0.1 -0.1
ADR 0.6 1.7 2.3
RevPAR 5.0 1.9 2.1
STR Analytics Custom Forecast
56
Takeaways
Supply Muted
Demand Back
Pricing Power Slow to Improve
Need Rate to Start Driving RevPAR
Overall Positive Environment
57
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