US and Maryland Lodging Overview Steve Hood, Senior VP SMITH TRAVEL RESEARCH
Agenda <ul><li>Total US Overview </li></ul><ul><li>Maryland Overview </li></ul><ul><li>US Projections </li></ul>
Total US Overview
Europe € H1 08  YE 08  09 YTD  -0.4%  -5.1%  -20.0% ME & A $ H1 08  YE 08  09 YTD 25.7%  14.8%   -18.2% Asia Pacific $ H1 ...
Total US - Key Performance Indicators July 2008 versus July 2009 YTD As of July 2009
Total US - Key Performance Indicators  Percent Change Full Year  2008 versus July 2009 YTD
Total US - Historic Supply & Demand Percent Change Twelve Month  Moving Average –  1989  to July 2009 2008 Smith Travel Re...
Total US - Room Supply Percent Change Monthly   Jan 2003 – July  2009 Stuck at 3.2
Total US -  Closed  Hotels Annual 2002 through 2009 2009 Smith Travel Research, Inc. 66,946 rooms in  2005  to 13,500 room...
Total US -  Opened  Hotels Annual 2002 through 2009 2009 Smith Travel Research, Inc. 152,001 rooms in  2008 , 155,000 room...
Total US - Room Demand Percent Change Monthly January 2003 –  July 2009
Total US – Historic Occupancy & ADR % Change Twelve Month  Moving Average – 1989 to July  2009 -3.4% -6.8% -8.9% -5.1% -4....
Total US - Historic Occupancy & ADR Twelve Month  Moving Average – July 2009 2008 Smith Travel Research, Inc.
If year 2000 ADR had increased by CPI each year… Total US Historic Room Rates - Actual vs. Inflation Adjusted Annual  2000...
Total US - Demand & ADR Percent Change Running 28 Day ( Daily Data ) - January 1 to August 29, 2009
Total US - Group & Transient Demand % Change  Running 28 Day – January 31, 2008 to August 29, 2009 Oct 2008 Jul 2009
Total US – Occupancy by Day of Week July 2008 YTD vs. July 2009 YTD Less of a gap on the weekend, Saturday highest occ day...
Total US - ADR by Day of Week  July 2008 YTD vs. July 2009 YTD Gap even for every  day of the week
Total US -  Transient  Occupancy & ADR % Change Weekday / Weekend – August 29,  YTD 2009 Smith Travel Research, Inc. Trans...
Total US -  Group  Occupancy & ADR % Change Weekday / Weekend – September 5, YTD 2009 Smith Travel Research, Inc. Group oc...
US Chain Scales - Occupancy & ADR % Change July 2009  YTD
US Location Segments – Occupancy & ADR % Change July 2009 YTD
US Regions – Occupancy, ADR, & RevPAR Percent Change July 2009 YTD Occupancy:  ▼   -11.1 % ADR:   ▼ -10.5% RevPAR:  ▼ -20....
Top 25 Markets versus Rest of US – Percent Changes July 2009 YTD ADR for Top 25 more impacted
Maryland Overview
Maryland Key Statistics July 2009  YTD <ul><li>  % Change </li></ul><ul><li>Number of Hotels     644 </li></ul><ul><li>Num...
Comparative States - Room Supply % Change July 2009 YTD 2008 Smith Travel Research, Inc.
Comparative States - Room Demand % Change July 2009 YTD 2008 Smith Travel Research, Inc.
Comparative States - Occupancy % Change July 2009 YTD 2008 Smith Travel Research, Inc. 51.5% 53.7% 56.5% 58.4% 61.3% 51.9%...
Comparative States - ADR Percent Change July 2009 YTD 2008 Smith Travel Research, Inc. 104.36 99.99 79.95 98.40 113.60 99....
Comparative States - RevPAR Percent Change July 2009 YTD 2008 Smith Travel Research, Inc. 44.63 55.97 52.85 51.50 41.46 66...
Baltimore Market 4 tracts –  City ,  Suburbs  (County),  Area  (Howard, Carroll, Harford, Queen Anne’s),  BWI/Annapolis  (...
Maryland Area Market 2 tracts –  West  (Washington, Allegheny, Garrett),  Chesapeake/Ocean City  (Kent, Talbot, Caroline, ...
Washington, DC Market 3 MD tracts –  Frederick/Rockville  (Frederick, Montgomery),  Bethesda/College Park ,  MD South/East...
Maryland Hotel Census Statistics by Tract July 2009 YTD 2008 Smith Travel Research, Inc. Market Tract Census Sample Props ...
Maryland  Tracts  - Room Supply % Change July 2009 YTD 2008 Smith Travel Research, Inc.
Maryland Tracts - Room Demand % Change July 2009 YTD 2008 Smith Travel Research, Inc.
Maryland Tracts – Occupancy Percent Change July 2009 YTD 2008 Smith Travel Research, Inc.
Maryland Tracts – ADR Percent Change July 2009 YTD 2008 Smith Travel Research, Inc.
Maryland Tracts – RevPAR Percent Change July 2009 YTD 2008 Smith Travel Research, Inc.
Maryland  Counties  – RevPAR % Change July 2009 YTD 2008 Smith Travel Research, Inc.
Maryland Smaller  Cities  – RevPAR % Change July 2009 YTD 2008 Smith Travel Research, Inc.
Maryland Hotel Census Statistics by  Brand July 2009 YTD Chain Census Props Census Rooms Sample Props Sample Rooms Marriot...
Maryland Hotel Census Statistics by  Scale July 2009 YTD 2008 Smith Travel Research, Inc. Scale Census Props Census Rooms ...
Maryland by Scale - Supply Percent Change July 2009  YTD
Maryland by Scale - Demand Percent Change July 2009  YTD
Maryland by Scale - Occupancy % Change July 2009  YTD
Maryland by Scale – ADR Percent Change July 2009  YTD
Maryland by Scale - RevPAR Percent Change July 2009  YTD
Maryland by Location - Supply Percent Change July 2009  YTD
Maryland by Location - Demand Percent Change July 2009  YTD
Maryland by Location – Occupancy % Change July 2009  YTD
Maryland by Location - ADR Percent Change July 2009  YTD
Maryland by Location - RevPAR Percent Change July 2009  YTD
Comparative  Markets - Room Supply % Change July 2009 YTD 2008 Smith Travel Research, Inc. Larger cities or geographic areas
Comparative Markets - Room Demand % Change July 2009 YTD 2008 Smith Travel Research, Inc.
Comparative Markets - Occupancy % Change July 2009 YTD 2008 Smith Travel Research, Inc.
Comparative Markets – ADR Percent Change July 2009 YTD 2008 Smith Travel Research, Inc.
Comparative Markets – RevPAR Percent Change July 2009 YTD 2008 Smith Travel Research, Inc.
Comparative DC Tracts - Supply % Change July 2009 YTD 2008 Smith Travel Research, Inc.
Comparative DC Tracts - Demand % Change July 2009 YTD 2008 Smith Travel Research, Inc.
Comparative DC Tracts - Occupancy % Change July 2009 YTD 2008 Smith Travel Research, Inc.
Comparative DC Tracts – ADR Percent Change July 2009 YTD 2008 Smith Travel Research, Inc.
Comparative DC Tracts - RevPAR % Change July 2009 YTD 2008 Smith Travel Research, Inc.
Comparative OC  Tracts  - Supply % Change July 2009 YTD 2008 Smith Travel Research, Inc.
Comparative OC Tracts - Demand % Change July 2009 YTD 2008 Smith Travel Research, Inc.
Comparative OC Tracts - Occupancy % Change July 2009 YTD 2008 Smith Travel Research, Inc.
Comparative OC Tracts - ADR % Change July 2009 YTD 2008 Smith Travel Research, Inc.
Comparative OC Tracts - RevPAR % Change July 2009 YTD 2008 Smith Travel Research, Inc.
Comparative MD Tracts - RevPAR % Change July 2009 YTD 2008 Smith Travel Research, Inc.
Comparative Annapolis Tracts - RevPAR % Change July 2009 YTD 2008 Smith Travel Research, Inc.
Maryland – Occupancy by Day of Week July 2008 YTD vs. July 2009 YTD
Maryland - ADR by Day of Week  July 2008 YTD vs. July 2009 YTD
Maryland - Demand & ADR Percent Change Running 28 Day (Daily Data) - January 1 – August 29, 2009
Baltimore - Demand & ADR Percent Change Running 28 Day (Daily Data) - January 1 – August 29, 2009
DC - Demand & ADR Percent Change Running 28 Day (Daily Data) - January 1 – August 29, 2009
Ocean City - Demand & ADR Percent Change Running 28 Day (Daily Data) - January 1 – August 29, 2009
Maryland - Group & Transient Demand % Change Running 28 Day – January 31,  2008  – August 29,  2009
Maryland - Group & Transient  Absolute ADR   Running 28 Day - January 31, 2008 – August 29, 2009 $23  difference $11
MD Pipeline – New Opens (l ast year, less 4) – 30 props, 4,005 rooms Baltimore Hilton 757 Aug-08 Oxon Hill Residence Inn 1...
MD Pipeline – Under Construction,  July 2009 – 22 props, 2,552 rooms Hilton Garden Inn Aberdeen 96 Sep-09 Holiday Inn Expr...
Maryland Pipeline – Planning w/ Proj. Open Date in 2010 2008 Smith Travel Research, Inc. Totals  -  Final Planning : 12 pr...
Total US Projections
US Economic Outlook - Blue Chip Economic Indicators July 2009 <ul><li>2008 2009F 2010F </li></ul><ul><li>Real GDP +1.1% -2...
Total US - Consecutive Quarterly Declines Key Indicators during prior downturns 2008 Smith Travel Research, Inc. 1990/ 199...
Total US - Active Development Pipeline - Rooms Change From Last Year Source: STR / TWR / Dodge Construction Pipeline Phase...
Total US - Room Supply Percent Change January 2003 –  June 2009 / July – December  Forecast July: 3.2 vs. 3.1 to December:...
Total US - Room Demand Percent Change January 2003 –  June 2009 / July – December  Forecast
Total US – Annual Supply/Demand % Change 2003 – 2010 Projected
Total US - Occupancy Percent Change Jan 2003 – June  2009 / July – December Forecast
Total US – Annual Occupancy Percent Change 2003 – 2010P 20 Year Average: -0.6%
Total US – Annual Absolute Occupancy  2003 – 2010P
Total US - Room Rate Percent Change Jan 2003 –  June 2009 / July – December Forecast
Total US – Annual ADR Percent Change 2003 – 2010P 20 Year Average: 3.5%
Total US – Annual Absolute Average Daily Rate 2003 – 2010P
Total US - RevPAR Percent Change Jan 2003 –  June 2009 / July – December Forecast
Total US - Annual RevPAR Percent Change 2003 – 2010P 20 Year Average: 2.9%
Total US -  Annual Absolute RevPAR 2003 – 2010P
Total United States Key Performance Indicators Percent Change Full Year 2009 2010 Forecast
Takeaways <ul><li>Visibility remains difficult </li></ul><ul><li>Decline is global </li></ul><ul><li>Demand probably at or...
[email_address]   615-824-8664 ext. 3315 www.strglobal.com Presentation Available on www.hotelnewsnow.com “Industry Presen...
Total US - RevPAR Percent Change Twelve Month  Moving Average – 1989 to July 2009 2008 Smith Travel Research, Inc. -10.5% ...
Total US - Group & Transient  ADR % Change Running 28 Day - January 31, 2008 – August 15, 2009 Transient ADR falling sharper
Total US - Group & Transient  Absolute ADR   Running 28 Day - January 31, 2008 – August 15, 2009 Group ADR surpasses Trans...
Top 25 Markets vs. Rest of US - Quarterly RevPar % Change 1 st  Quarter 2007 – 2 nd  Quarter 2009 Top 25 rise faster but a...
Top 25 Markets - RevPAR Percent Change June 2009 YTD Most of Top 25 markets below US average
Total US - Occupancy Percent Change Number of Properties  -  June 2009 YTD Industry average: - 10.9
Total United States ADR Percent Change Number of Properties - June 2009 YTD Industry average: - 8.7
Total US - Hotel Rooms Sold vs. ADR Change Quarterly Change – 1988 to Q4 2009E
If year 2000 ADR had increased by CPI each year… Total US Room Rates Actual vs. Inflation Adjusted 2000 – 2010E
Total United States Supply, Demand & Occupancy Forecast Q3 2009 – Q4 2010   2008 Smith Travel Research, Inc.
Total United States ADR, RevPar and Room Revenue Forecast Q3 2009 – Q4 2010   2008 Smith Travel Research, Inc.
<ul><li>Budgets and forecasts impossible to manage </li></ul><ul><li>Risk cannibalising existing business and damage to br...
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  • Source: Global performance review – inconsistent sample UK – (£) US, MEA, ASIA Pacific – ($) Europe (€) Inconsistent sample
  • 2005 and 2006 economic outlook is currently good.
  • Smith Travel Research Presentation

    1. 1. US and Maryland Lodging Overview Steve Hood, Senior VP SMITH TRAVEL RESEARCH
    2. 2. Agenda <ul><li>Total US Overview </li></ul><ul><li>Maryland Overview </li></ul><ul><li>US Projections </li></ul>
    3. 3. Total US Overview
    4. 4. Europe € H1 08 YE 08 09 YTD -0.4% -5.1% -20.0% ME & A $ H1 08 YE 08 09 YTD 25.7% 14.8% -18.2% Asia Pacific $ H1 08 YE 08 09 YTD 12.5% 2.9% -26.0% Americas $ H1 08 YE 08 09 YTD 4.2% -0.4% -20.6% UK £ H1 08 YE 08 09 YTD 2.5% -0.4% -11.1% Global - RevPAR Percent Change July 2009 YTD USA $ H1 08 YE 08 09 YTD 1.7% -1.8% -18.2%
    5. 5. Total US - Key Performance Indicators July 2008 versus July 2009 YTD As of July 2009
    6. 6. Total US - Key Performance Indicators Percent Change Full Year 2008 versus July 2009 YTD
    7. 7. Total US - Historic Supply & Demand Percent Change Twelve Month Moving Average – 1989 to July 2009 2008 Smith Travel Research, Inc. 3.1% - 6.0% -1.1% - 4.8% ▼ ▼ ▼ ▼ ▼ ▼ ▼ ▼ ▼ ▼
    8. 8. Total US - Room Supply Percent Change Monthly Jan 2003 – July 2009 Stuck at 3.2
    9. 9. Total US - Closed Hotels Annual 2002 through 2009 2009 Smith Travel Research, Inc. 66,946 rooms in 2005 to 13,500 rooms in 2009 JQH: “not over developed, just under demolished”
    10. 10. Total US - Opened Hotels Annual 2002 through 2009 2009 Smith Travel Research, Inc. 152,001 rooms in 2008 , 155,000 rooms in 2009 estimated
    11. 11. Total US - Room Demand Percent Change Monthly January 2003 – July 2009
    12. 12. Total US – Historic Occupancy & ADR % Change Twelve Month Moving Average – 1989 to July 2009 -3.4% -6.8% -8.9% -5.1% -4.7% 0.1% Occ goes negative and ADR drops Occ turns around and ADR follows (approx. 3 months)
    13. 13. Total US - Historic Occupancy & ADR Twelve Month Moving Average – July 2009 2008 Smith Travel Research, Inc.
    14. 14. If year 2000 ADR had increased by CPI each year… Total US Historic Room Rates - Actual vs. Inflation Adjusted Annual 2000 - 2008
    15. 15. Total US - Demand & ADR Percent Change Running 28 Day ( Daily Data ) - January 1 to August 29, 2009
    16. 16. Total US - Group & Transient Demand % Change Running 28 Day – January 31, 2008 to August 29, 2009 Oct 2008 Jul 2009
    17. 17. Total US – Occupancy by Day of Week July 2008 YTD vs. July 2009 YTD Less of a gap on the weekend, Saturday highest occ day of week
    18. 18. Total US - ADR by Day of Week July 2008 YTD vs. July 2009 YTD Gap even for every day of the week
    19. 19. Total US - Transient Occupancy & ADR % Change Weekday / Weekend – August 29, YTD 2009 Smith Travel Research, Inc. Transient occupancy much less impacted on weekends ADR almost the same
    20. 20. Total US - Group Occupancy & ADR % Change Weekday / Weekend – September 5, YTD 2009 Smith Travel Research, Inc. Group occupancy less impacted on weekend ADR almost the same
    21. 21. US Chain Scales - Occupancy & ADR % Change July 2009 YTD
    22. 22. US Location Segments – Occupancy & ADR % Change July 2009 YTD
    23. 23. US Regions – Occupancy, ADR, & RevPAR Percent Change July 2009 YTD Occupancy: ▼ -11.1 % ADR: ▼ -10.5% RevPAR: ▼ -20.5 % Occupancy: ▼ -13.4% ADR: ▼ -12.8 % RevPAR: ▼ -24.4 % Occupancy: ▼ -8.1 % ADR: ▼ -2.4% RevPAR: ▼ -10.3 % Occupancy: ▼ -11.4 % ADR: ▼ -3.8% RevPAR: ▼ -14.7 % Occupancy: ▼ -10.5 % ADR: ▼ -7.3% RevPAR: ▼ -17.1 % Occupancy: ▼ -8.3 % ADR: ▼ -3.1 % RevPAR: ▼ -11.0 % Occupancy: ▼ -8.8 % ADR: ▼ -7.2% RevPAR: ▼ -15.3 % Occupancy: ▼ -10.3 % ADR: ▼ -14.5% RevPAR: ▼ -23.3 % Occupancy: ▼ -10.1% ADR: ▼ -7.2% RevPAR: ▼ -16.5 % 2008 Smith Travel Research, Inc. TOTAL US Occupancy: ▼ -10.4 % ADR: ▼ -8.8% RevPAR: ▼ -18.2 %
    24. 24. Top 25 Markets versus Rest of US – Percent Changes July 2009 YTD ADR for Top 25 more impacted
    25. 25. Maryland Overview
    26. 26. Maryland Key Statistics July 2009 YTD <ul><li> % Change </li></ul><ul><li>Number of Hotels 644 </li></ul><ul><li>Number of Rooms 73,452 </li></ul><ul><li>Room Supply 14,983,880 5.4% (5) </li></ul><ul><li>Room Demand 8,757,736 .6% (2) </li></ul><ul><li>Occupancy 58.4% (10) - 4.6% (6) </li></ul><ul><li>Average Daily Rate $113.60 (5) - 3.6% </li></ul><ul><li>RevPAR $66.40 (8) - 8.0% (9) </li></ul><ul><li>Room Revenue $995 million - 3.0% (6) </li></ul>2008 Smith Travel Research, Inc.
    27. 27. Comparative States - Room Supply % Change July 2009 YTD 2008 Smith Travel Research, Inc.
    28. 28. Comparative States - Room Demand % Change July 2009 YTD 2008 Smith Travel Research, Inc.
    29. 29. Comparative States - Occupancy % Change July 2009 YTD 2008 Smith Travel Research, Inc. 51.5% 53.7% 56.5% 58.4% 61.3% 51.9% 50.4% 58.5%
    30. 30. Comparative States - ADR Percent Change July 2009 YTD 2008 Smith Travel Research, Inc. 104.36 99.99 79.95 98.40 113.60 99.04 76.25 153.77
    31. 31. Comparative States - RevPAR Percent Change July 2009 YTD 2008 Smith Travel Research, Inc. 44.63 55.97 52.85 51.50 41.46 66.40 52.63 94.28
    32. 32. Baltimore Market 4 tracts – City , Suburbs (County), Area (Howard, Carroll, Harford, Queen Anne’s), BWI/Annapolis (Anne Arundel) Wilmington, DE (Cecil County)
    33. 33. Maryland Area Market 2 tracts – West (Washington, Allegheny, Garrett), Chesapeake/Ocean City (Kent, Talbot, Caroline, Dorcester, Wicomico, Worcester, St. Marys)
    34. 34. Washington, DC Market 3 MD tracts – Frederick/Rockville (Frederick, Montgomery), Bethesda/College Park , MD South/East (Prince Georges, Calvert, Charles)
    35. 35. Maryland Hotel Census Statistics by Tract July 2009 YTD 2008 Smith Travel Research, Inc. Market Tract Census Sample Props Rooms Props Rooms Baltimore Baltimore City 49 9,452 38 8,998 Baltimore Baltimore Suburbs 59 6,193 37 5,177 Baltimore Baltimore Area 73 6,215 55 5,528 Baltimore BWI Airport/Annapolis 71 9,824 65 9,205 MD Area West/Hagerstown 44 3,468 30 2,768 MD Area Chesapeake/Ocean City 166 13,903 58 6,698 Washington DC Frederick/Rockville 55 7,668 49 7,494 Washington DC Bethesda/College Park 40 5,796 38 5,731 Washington DC MD South/East 76 9,967 59 9,125
    36. 36. Maryland Tracts - Room Supply % Change July 2009 YTD 2008 Smith Travel Research, Inc.
    37. 37. Maryland Tracts - Room Demand % Change July 2009 YTD 2008 Smith Travel Research, Inc.
    38. 38. Maryland Tracts – Occupancy Percent Change July 2009 YTD 2008 Smith Travel Research, Inc.
    39. 39. Maryland Tracts – ADR Percent Change July 2009 YTD 2008 Smith Travel Research, Inc.
    40. 40. Maryland Tracts – RevPAR Percent Change July 2009 YTD 2008 Smith Travel Research, Inc.
    41. 41. Maryland Counties – RevPAR % Change July 2009 YTD 2008 Smith Travel Research, Inc.
    42. 42. Maryland Smaller Cities – RevPAR % Change July 2009 YTD 2008 Smith Travel Research, Inc.
    43. 43. Maryland Hotel Census Statistics by Brand July 2009 YTD Chain Census Props Census Rooms Sample Props Sample Rooms Marriott 10 3823 10 3823 Holiday Inn 15 3038 15 3038 Comfort Inn 27 2925 27 2925 Courtyard 18 2649 17 2558 Hampton Inn 22 2555 22 2555 Hilton 8 2464 8 2464 Sheraton Hotel 8 2376 8 2376 Days Inn 22 2270 22 2270 Best Western 18 2059 13 1600 Gaylord Entertainment 1 2000 1 2000 Residence Inn 15 1861 15 1861 Holiday Inn Express Hotel 18 1675 18 1675 Hilton Garden Inn 11 1519 11 1519 Quality Inn 12 1515 12 1515 Red Roof Inn 11 1312 11 1312 Hyatt 3 1278 3 1278
    44. 44. Maryland Hotel Census Statistics by Scale July 2009 YTD 2008 Smith Travel Research, Inc. Scale Census Props Census Rooms Sample Props Sample Rooms Luxury Chains 2 411 2 411 Upper Upscale Chains 43 14990 43 14990 Upscale Chains 79 11214 78 11123 Midscale W/ F&B Chains 61 9020 56 8561 Midscale W/O F&B Chains 135 13848 135 13848 Economy Chains 114 10106 106 9685 Independents 210 13863 18 2890
    45. 45. Maryland by Scale - Supply Percent Change July 2009 YTD
    46. 46. Maryland by Scale - Demand Percent Change July 2009 YTD
    47. 47. Maryland by Scale - Occupancy % Change July 2009 YTD
    48. 48. Maryland by Scale – ADR Percent Change July 2009 YTD
    49. 49. Maryland by Scale - RevPAR Percent Change July 2009 YTD
    50. 50. Maryland by Location - Supply Percent Change July 2009 YTD
    51. 51. Maryland by Location - Demand Percent Change July 2009 YTD
    52. 52. Maryland by Location – Occupancy % Change July 2009 YTD
    53. 53. Maryland by Location - ADR Percent Change July 2009 YTD
    54. 54. Maryland by Location - RevPAR Percent Change July 2009 YTD
    55. 55. Comparative Markets - Room Supply % Change July 2009 YTD 2008 Smith Travel Research, Inc. Larger cities or geographic areas
    56. 56. Comparative Markets - Room Demand % Change July 2009 YTD 2008 Smith Travel Research, Inc.
    57. 57. Comparative Markets - Occupancy % Change July 2009 YTD 2008 Smith Travel Research, Inc.
    58. 58. Comparative Markets – ADR Percent Change July 2009 YTD 2008 Smith Travel Research, Inc.
    59. 59. Comparative Markets – RevPAR Percent Change July 2009 YTD 2008 Smith Travel Research, Inc.
    60. 60. Comparative DC Tracts - Supply % Change July 2009 YTD 2008 Smith Travel Research, Inc.
    61. 61. Comparative DC Tracts - Demand % Change July 2009 YTD 2008 Smith Travel Research, Inc.
    62. 62. Comparative DC Tracts - Occupancy % Change July 2009 YTD 2008 Smith Travel Research, Inc.
    63. 63. Comparative DC Tracts – ADR Percent Change July 2009 YTD 2008 Smith Travel Research, Inc.
    64. 64. Comparative DC Tracts - RevPAR % Change July 2009 YTD 2008 Smith Travel Research, Inc.
    65. 65. Comparative OC Tracts - Supply % Change July 2009 YTD 2008 Smith Travel Research, Inc.
    66. 66. Comparative OC Tracts - Demand % Change July 2009 YTD 2008 Smith Travel Research, Inc.
    67. 67. Comparative OC Tracts - Occupancy % Change July 2009 YTD 2008 Smith Travel Research, Inc.
    68. 68. Comparative OC Tracts - ADR % Change July 2009 YTD 2008 Smith Travel Research, Inc.
    69. 69. Comparative OC Tracts - RevPAR % Change July 2009 YTD 2008 Smith Travel Research, Inc.
    70. 70. Comparative MD Tracts - RevPAR % Change July 2009 YTD 2008 Smith Travel Research, Inc.
    71. 71. Comparative Annapolis Tracts - RevPAR % Change July 2009 YTD 2008 Smith Travel Research, Inc.
    72. 72. Maryland – Occupancy by Day of Week July 2008 YTD vs. July 2009 YTD
    73. 73. Maryland - ADR by Day of Week July 2008 YTD vs. July 2009 YTD
    74. 74. Maryland - Demand & ADR Percent Change Running 28 Day (Daily Data) - January 1 – August 29, 2009
    75. 75. Baltimore - Demand & ADR Percent Change Running 28 Day (Daily Data) - January 1 – August 29, 2009
    76. 76. DC - Demand & ADR Percent Change Running 28 Day (Daily Data) - January 1 – August 29, 2009
    77. 77. Ocean City - Demand & ADR Percent Change Running 28 Day (Daily Data) - January 1 – August 29, 2009
    78. 78. Maryland - Group & Transient Demand % Change Running 28 Day – January 31, 2008 – August 29, 2009
    79. 79. Maryland - Group & Transient Absolute ADR Running 28 Day - January 31, 2008 – August 29, 2009 $23 difference $11
    80. 80. MD Pipeline – New Opens (l ast year, less 4) – 30 props, 4,005 rooms Baltimore Hilton 757 Aug-08 Oxon Hill Residence Inn 162 Aug-08 Hanover, Arundel Mills TownePlace Suites 109 Oct-08 Waldorf Courtyard 91 Dec-08 Clinton TownePlace Suites 115 Dec-08 Silver Spring Hampton Inn 149 Jan-09 Silver Spring Homewood Suites 90 Jan-09 Baltimore Country Inn & Suites 81 Mar-09 Oxon Hill aloft Hotels 190 Mar-09 Hanover, Arundel Mills Hilton Garden Inn 151 Mar-09 Hanover, Arundel Mills Homewood Suites 99 Mar-09 Baltimore Quality Inn 96 Mar-09 Bel Air Candlewood Suites 95 Mar-09 Hanover, Arundel Mills aloft Hotels 143 May-09 Hanover, Arundel Mills element 147 May-09 Elkridge Holiday Inn Express Hotel 98 Jun-09 Waldorf Residence Inn 98 Jun-09 Ocean City Courtyard 91 Jul-09 Bel Air Homewood Suites 92 Jul-09 Baltimore Kimpton 202 Jul-09 Lexington Park TownePlace Suites 87 Jul-09 Baltimore Fairfield Inn 154 Jul-09 Linthicum Heights aloft Hotels 155 Aug-09 Aberdeen Hilton Garden Inn 96 Aug-09 Cumberland Fairfield Inn 108 Aug-09 Columbia Springhill Suites 117 Aug-09
    81. 81. MD Pipeline – Under Construction, July 2009 – 22 props, 2,552 rooms Hilton Garden Inn Aberdeen 96 Sep-09 Holiday Inn Express Baltimore 68 Sep-09 Hilton Garden Inn Bethesda 216 Oct-09 Country Inn & Suites Hanover 86 Oct-09 Residence Inn Hunt Valley 141 Nov-09 Country Inn & Suites California 84 Dec-09 Hotel Indigo Baltimore 135 Dec-09 Comfort Suites Elkton 83 Dec-09 Hilton Garden Inn St Charles 130 Jan-10 Hilton Garden Inn Rockville 112 Jan-10 Homewood Suites Rockville 87 Jan-10 Brexton Hotel Baltimore 30 Jan-10 Courtyard Hagerstown 96 Mar-10 Hilton Garden Inn Silver Spring 104 Apr-10 Staybridge Suites Baltimore 100 Jun-10 Hampton Inn Suites Edgewood 134 Jul-10 Four Points Baltimore 153 Sep-10 Residence Inn Landover 96 Sep-10 Hampton Inn Suites Camp Springs 117 Dec-10 Hampton Inn Suites Columbia 124 Apr-11 Courtyard Hyattsville 104 Apr-11 Four Seasons Baltimore 256 Dec-11
    82. 82. Maryland Pipeline – Planning w/ Proj. Open Date in 2010 2008 Smith Travel Research, Inc. Totals - Final Planning : 12 props, 1,198 rooms; Planning : 48 props, 5,981 rooms; Pre-Planning : 15 props, 1,593 rooms Holiday Inn Express White Marsh 96 Apr-10 Fairfield Inn Hanover 97 May-10 Holiday Inn Express Aberdeen 85 Jun-10 TownePlace Suites College Park 76 Jul-10 Homewood Suites Columbia 114 Aug-10 Fairfield Inn Linthicum Heights 107 Aug-10 Hampton Inn Owings Mills 101 Aug-10 Courtyard Hyattsville 162 Sep-10 Unnamed Boutique Hotel @ Penn Station Baltimore 72 Dec-10 Staybridge Suites Savage 120 Sep-10 Staybridge Suites Greenbelt 125 Sep-10 Holiday Inn Express Edgewood 90 Sep-10 Holiday Inn Express Cumberland 83 Oct-10 Hampton Inn Suites Baltimore 100 Oct-10 Candlewood Suites Hanover 99 Nov-10 Candlewood Suites Camp Springs 100 Nov-10 Holiday Inn Glen Burnie 130 Dec-10 Holiday Inn Express Linthicum 110 Dec-10
    83. 83. Total US Projections
    84. 84. US Economic Outlook - Blue Chip Economic Indicators July 2009 <ul><li>2008 2009F 2010F </li></ul><ul><li>Real GDP +1.1% -2.6% +2.0% </li></ul><ul><li>CPI +4.0% -0.6% +1.8% </li></ul><ul><li>Corporate Profits -8.5% -12.4% +6.7% </li></ul><ul><li>Disp Personal Income +1.1% +2.3% +1.6% </li></ul><ul><li>Unemployment Rate 5.8% 9.3% 9.9% </li></ul>
    85. 85. Total US - Consecutive Quarterly Declines Key Indicators during prior downturns 2008 Smith Travel Research, Inc. 1990/ 1991 2001/ 2002 Current (2008-9) Estimate 2008-10 Demand 3 5 6 9 Occupancy 7 6 7 11 ADR 0 5 3 9? RevPAR 5 5 4 9 Room Revenue 2 5 4 7
    86. 86. Total US - Active Development Pipeline - Rooms Change From Last Year Source: STR / TWR / Dodge Construction Pipeline Phase July 2009 July 2008 Difference % Change In Construction 141,957 199,892 -57,935 -29.0% Final Planning 71,116 100,201 -29,085 -29.0% Planning 274,758 360,835 -86,077 -23.9% Active Pipeline 487,831 660,928 -173,097 -26.2% Pre-Planning 118,378 146,131 -27,753 -19.0% Total 606,209 807,059 -200,850 -24.9%
    87. 87. Total US - Room Supply Percent Change January 2003 – June 2009 / July – December Forecast July: 3.2 vs. 3.1 to December: 2.6
    88. 88. Total US - Room Demand Percent Change January 2003 – June 2009 / July – December Forecast
    89. 89. Total US – Annual Supply/Demand % Change 2003 – 2010 Projected
    90. 90. Total US - Occupancy Percent Change Jan 2003 – June 2009 / July – December Forecast
    91. 91. Total US – Annual Occupancy Percent Change 2003 – 2010P 20 Year Average: -0.6%
    92. 92. Total US – Annual Absolute Occupancy 2003 – 2010P
    93. 93. Total US - Room Rate Percent Change Jan 2003 – June 2009 / July – December Forecast
    94. 94. Total US – Annual ADR Percent Change 2003 – 2010P 20 Year Average: 3.5%
    95. 95. Total US – Annual Absolute Average Daily Rate 2003 – 2010P
    96. 96. Total US - RevPAR Percent Change Jan 2003 – June 2009 / July – December Forecast
    97. 97. Total US - Annual RevPAR Percent Change 2003 – 2010P 20 Year Average: 2.9%
    98. 98. Total US - Annual Absolute RevPAR 2003 – 2010P
    99. 99. Total United States Key Performance Indicators Percent Change Full Year 2009 2010 Forecast
    100. 100. Takeaways <ul><li>Visibility remains difficult </li></ul><ul><li>Decline is global </li></ul><ul><li>Demand probably at or near bottom, September & October will be critical </li></ul><ul><li>Turn around will be slow </li></ul><ul><li>“ Less Worse” in 2 nd half of 2009 (comps easier) </li></ul><ul><li>Marginal improvement in 2010 </li></ul><ul><li>Time to earn “your keep” </li></ul><ul><li>Not time to have RMS on “auto pilot” </li></ul><ul><li>Look for ways to create value </li></ul><ul><li>Change in the mix, maximize experience </li></ul>
    101. 101. [email_address] 615-824-8664 ext. 3315 www.strglobal.com Presentation Available on www.hotelnewsnow.com “Industry Presentations”
    102. 102. Total US - RevPAR Percent Change Twelve Month Moving Average – 1989 to July 2009 2008 Smith Travel Research, Inc. -10.5% -13.4%
    103. 103. Total US - Group & Transient ADR % Change Running 28 Day - January 31, 2008 – August 15, 2009 Transient ADR falling sharper
    104. 104. Total US - Group & Transient Absolute ADR Running 28 Day - January 31, 2008 – August 15, 2009 Group ADR surpasses Transient ADR
    105. 105. Top 25 Markets vs. Rest of US - Quarterly RevPar % Change 1 st Quarter 2007 – 2 nd Quarter 2009 Top 25 rise faster but also fall farther
    106. 106. Top 25 Markets - RevPAR Percent Change June 2009 YTD Most of Top 25 markets below US average
    107. 107. Total US - Occupancy Percent Change Number of Properties - June 2009 YTD Industry average: - 10.9
    108. 108. Total United States ADR Percent Change Number of Properties - June 2009 YTD Industry average: - 8.7
    109. 109. Total US - Hotel Rooms Sold vs. ADR Change Quarterly Change – 1988 to Q4 2009E
    110. 110. If year 2000 ADR had increased by CPI each year… Total US Room Rates Actual vs. Inflation Adjusted 2000 – 2010E
    111. 111. Total United States Supply, Demand & Occupancy Forecast Q3 2009 – Q4 2010 2008 Smith Travel Research, Inc.
    112. 112. Total United States ADR, RevPar and Room Revenue Forecast Q3 2009 – Q4 2010 2008 Smith Travel Research, Inc.
    113. 113. <ul><li>Budgets and forecasts impossible to manage </li></ul><ul><li>Risk cannibalising existing business and damage to brand </li></ul><ul><li>In an upmarket, everyone follows the best practices of the market leader, in a downturn everyone follows the first person to panic </li></ul><ul><li>Smaller properties cannot make up in volume what they lose in rate </li></ul><ul><li>Decisions are based on competitors’ actions rather than hotel’s strategic initiatives and revenue needs </li></ul><ul><li>Ability to manipulate behaviour using price severely limited in a falling market </li></ul><ul><li>Discounting often ‘doubles up’ the loss of occupancy and rate </li></ul><ul><li>Profitability is often overlooked and can be adversely affected by reductions </li></ul><ul><li>Markets take years to recover </li></ul>The Impact of Discounting
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