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Tampa Lodging Overview

Despite being one of the slower Florida markets to recover, Tampa has quietly become one of the top performing lodging markets in the country in terms of RevPAR performance.

Robust 2014 with 11.8% RevPAR growth.

Trend continuing in 2015 as Tampa is #2 in the country with YTD RevPAR growth of 15.8% through March 2015 behind only Phoenix, which hosted the Super Bowl.

After growing nearly 7.0% in 2014, strong average rate growth is expected to continue its strong performance with over 7.0% growth in each of the next three years.

Unprecedented amount of capital chasing hotel transactions in the Tampa Bay Area

Regularly receiving double digit bids on transactions.

Tampa Bay was ranked among the top 25 fastest growing economies in the country in 2013 and 2014 according to the U.S. Conference of Mayors.

Economic recovery is attributable to enhanced airport facilities, new international flights, and the relocation of many healthcare companies to the area.

In fact, Tampa International Airport recently embarked on a $1 billion expansion to double its capacity and construct a new rental car facility.

Limited new hotel supply on a comparative basis.

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Tampa Lodging – Key 2015 Themes

Increasing “institutionalization” of the buyer pool.

Strong performance expected to continue for several years as RevPAR is expected to average 8.6% in 2015 and 2016.

While 2014 growth was led by the lower-priced segment, 2015 is expected to be led by the upper-priced segment (9.0% projected RevPAR Growth).

Not just a theme in Tampa, select service transactions are in high demand as evidenced by recent transaction achieving cap rates lower than ever before.

Buyers that have been priced out of South Florida are turning their attention to central and west Florida, which is benefitting cities like Tampa.

Relatively minimal new supply as Tampa is ranked 37th in the US in terms of its construction Pipeline with only 4 deals currently under construction.

Pro-business leadership.

Continue to capitalize on major events.

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Tampa Tourism Continues to Thrive While total number of visitors was down slightly in 2013, visitor spending reached a new high

at $4.4 billion meaning visitors were spending more than ever before.

Florida attracted a record 97.3 million visitors in 2014. Therefore, it is anticipated that the 2014 visitors and spending numbers will increase over 2013 when they become available.

In Hillsborough County, hotels reached 70% occupancy for the first time in history and generated a record $540 million in gross revenue.

Major citywide events scheduled for 2015 which will have a large impact on visitation and

spending include the Tampa Bay Outback Bowl, the New York Yankees Fantasy Camp, NCAA Women’s Final Four, and the St. Petersburg Bowl which may draw as many visitors to Tampa as the Super Bowl.

Source: Visit Tampa Bay

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International Airport Volumes on Upward Trajectory

Passenger volumes at TIA have been steadily recovering, with an additional +/- 8% growth needed to return to peak. Today, TIA remains in the top 30 of all US airports in volume.

TIA has also just embarked on a $1 billion expansion, which will double its capacity and create a new rental car facility.

After taking a huge hit with the closure of Southeast Airlines in November 2004, PIE, a hub for Allegient Airlines and Silver Air, is just 6% below its peak after two years of tremendous growth.

Source: Tampa International Airport

Tampa International Airport Passenger Counts

Year Total Annual Passengers % Change2000 16,043,383 N/A2001 15,888,436 -1.0%2002 15,494,668 -2.5%2003 15,523,568 0.2%2004 17,396,836 12.1%2005 19,045,390 9.5%2006 18,867,541 -0.9%2007 19,154,957 1.5%2008 18,262,934 -4.7%2009 16,965,545 -7.1%2010 16,645,765 -1.9%2011 16,670,315 0.1%2012 16,820,859 0.9%2013 16,920,086 0.6%2014 17,552,707 3.7%

St. Pete-Clearwater International Airport Passenger Counts

YearTotal Annual Passengers % Change

2000 734,940 N/A2001 637,310 -13.3%2002 623,959 -2.1%2003 997,761 59.9%2004 1,333,069 33.6%2005 596,510 -55.3%2006 389,997 -34.6%2007 747,369 91.6%2008 742,380 -0.7%2009 776,535 4.6%2010 776,087 -0.1%2011 833,068 7.3%2012 865,942 3.9%2013 1,017,049 17.5%2014 1,247,987 22.7%

Source: St. Pete-Clearwater International Airport

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Westshore Performance Snapshot

Source: Smith Travel Research

Westshore’s lodging market experienced a slight decrease in performance metrics in 2013 due in large part to the market’s outstanding performance in 2012 which was bolstered by the Republican National Convention. However, 2014 was a tremendous year as RevPAR was up nearly 13% outpacing the US, the state of Florida and the Tampa-St. Petersburg MSA.

Compared to 2011, RevPAR in the Westshore market is up 37.7% as of year end 2014. 2015 RevPAR in the Tampa-St. Petersburg MSA is expected to increase an additional 8.9%.

USA Lodging Market At a Glance

2013 2014% Change

'13 - 14Occupancy 62.2% 64.4% 3.5%ADR $110.30 $115.32 4.6%RevPAR $68.58 $74.28 8.3%

Florida Lodging Market At a Glance

2013 2014% Change

'13 - 14Occupancy 66.8% 69.7% 4.3%ADR $118.21 $124.96 5.7%RevPAR $78.92 $87.07 10.3%

Tampa-St. Petersburg Market At a Glance

2013 2014% Change

'13 - 14Occupancy 64.3% 68.0% 5.8%ADR $100.44 $106.30 5.8%RevPAR $64.59 $72.33 12.0%

Westshore Lodging Market At a Glance

2011 2012 2013 2014% Change

'11 - 14% Change

'13 - 14Occupancy 67.5% 70.6% 71.0% 73.9% 9.5% 4.1%ADR $91.46 $97.09 $96.19 $104.37 14.1% 8.5%RevPAR $56.04 $68.51 $68.32 $77.16 37.7% 12.9%

Westshore 2014 RevPAR up 12.9% over 2013, outpacing the

US, Florida, and MSA.

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Westshore YoY Comparison

2014 was an impressive year for the Westshore lodging market as occupancy was up 4.1% and ADR was up 8.5% resulting in a 12.9% increased in RevPAR.

Source: Smith Travel Research

“The RNC Effect”

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Submarket Performance Metrics – Hillsborough County

Westshore continues to track as the second best submarket in terms of RevPAR in the Hillsborough County behind downtown Tampa.

While Westshore passed downtown in terms of occupancy in 2012, the ADR will continue to trail downtown due to the disproportionate share of lower rated select service and extended stay hotels within the submarket.

Source: Smith Travel Research

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Westshore Hotel Inventory – Full Service

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Westshore Hotel Inventory – Limited Service

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Downtown Hotel Inventory

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Westshore Brand Representation

Hilton 8

Marriott 8

IHG 5

Choice 4

Wyndham 3

Starwood 2

Other/Independents 10

Number of Hotels by Brand Family

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Brand Opportunities

Brands Not RepresentedFull Service Limited ServiceAndaz AC MarriottAutograph Collect ion Cambria SuitesBulgari Candlewood SuitesConrad ClarionCurio EconoLodgeDream ElementEdit ion Home 2 SuitesFour Points Hotel IndigoHotel Missoni Hyatt HouseJW Marriott MainStay SuitesPark Hyatt Marriott Executive ApartmentsPark Plaza Park InnPlanet Hollywood Rodeway InnRadisson Sleep InnRitz-Carlton Staybridge SuitesSt. Regis TrypThe Luxury Collect ion WingateTributeW

Brands Added in Last 12 MonthsFull Service Limited ServiceFairfield * AloftLe Meridien* Opening in May 2015

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Notable Trades in Westshore and Downtown Tampa Westshore Notable Trades (2010 - Present)

Date Property Name Price in $ $/Units Buyer SellerFeb-15 Hyatt Place Tampa $19,620,191 $155,716 ARC Hospitality Trust Whitehall Real Estate Funds

Feb-15 Hampton Inn $12,000,000 $90,226 Encore Hospitality GE Capital Real Estate

Jan-15 InterContinental $40,200,000 $124,845 Arden Group Lowe Enterprises JV Oaktree

Dec-14 Towneplace Suites Tampa Westshore Airport

$14,320,000 $117,377 Noble Investment Group McKibbon Hotel Group

Dec-14 Residence Inn Tampa Westshore Airport

$21,397,000 $133,731 Noble Investment Group McKibbon Hotel Group

Jun-12 Doubletree Suites by Hilton Tampa Bay

$23,000,000 $113,300 Platinum Equity Holdings FelCor Lodging

Nov-10 Grand Hyatt $58,500,000 $131,461 UBS Realty Advisors Hyatt Hotels

Downtown Notable Trades (2010 - Present)

Date Property Name Price in $ $/Units Buyer SellerPending Westin Tampa Harbour Island Confidential Confidential Confidential Blackstone Group

Dec-14 Courtyard Tampa Downtown $16,902,000 $119,872 Noble Investment Group McKibbon Hotel Group

Nov-14 Hilton Garden Inn Tampa $14,884,051 $156,674 NorthStar Realty Finance JV Chatham Lodging Trust

Inland American REIT

Sep-14 Tampa Marriott Waterside Hotel & Marina

$199,000,000 $276,773 Jeff Vinik JV Cascade Investments JV Strategic Properties

Host Hotels & Resorts

Dec-12 Hampton Inn & Suites $20,900,000 $151,449 Summit Hotel Properties Johnson Development Associates JV OTO Development

Dec-12 Hilton $63,000,000 $120,921 Driftwood Hospitality VEF Advisors

Apr-11 Hampton Inn & Suites $13,030,000 $94,420 Johnson Development Associates JV OTO Development

The Clarkson Co

Apr-10 Embassy Suites $77,000,040 $213,889 RLJ Development Whiteco Residential

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Westshore/Downtown Development Pipeline

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Westshore Lodging Market – Going Forward

Improving office market fundamentals, expanding corporate presence, and proximity to two international airports will lead to growing and sustained demand in the Westshore market.

Westshore will be able to capitalize on the Tampa Bay region’s ability to attract major events.

More transactions are likely to occur over next 12-24 months as owners are looking to take advantage of a heated market characterized by improving lodging fundamentals, increased competition by buyers targeting a fairly limited supply of assets around the state, and attractive interest rates throughout the capital stack.

Limited projected new supply in near term but aging product may create opportunities for new development or redevelopment of existing assets. Some developers are already taking advantage as the Fairfield Inn and Suites

opens this summer and the Hampton Inn and Suites will open in 2016.

We are in the early innings of the hotel development cycle. Lender and equity discipline remains, but quality projects with strong sponsors will now be able to attract capital.

More dry powder than ever before chasing real estate.