Impact of mega-events on hotel performance
Elizabeth Winkle, Managing Director
STR Global
Dubai Currently Ranks Amongst Highest ADR Cities
ADR and %Chg in USD, YE 2013
-1.3% -0.5%
+4.8%
-12.5%
+3.4%
-4.3%
-3.2%
-...
0
2
4
6
8
10
12
14
16
18
20
2006 2007 2008 2009 2010 2011 2012 2013 2014
Supply % Chg Demand % Chg
Dubai Peak Supply Growt...
Dubai Occ/ADR % Change
12 month moving average YE 2005 to February 2014, in USD
-30%
-25%
-20%
-15%
-10%
-5%
0%
5%
10%
15%...
100
110
120
130
140
150
160
170
180
190
200
-7 years -6 years -5 years -4 years -3 years -2 years -1 year Expo Year
Shangh...
Occupancy peaks at Expo start, ADR peaks at closing
YOY Occ, ADR % Jan’09 -Mar ’14 (Shanghai excluding Econ Class)
¥500
¥5...
Often More Displacement than Demand
Total Demand and % Changes, YE of each Olympic city
+0.8%
-1.3%
+9.6%
-5.9% +2.6%
0
5
...
Occupancy Below 90%
Occupancy by month during Olympic Year
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Jan Feb Mar Apr May...
Concentrated Rate Growth During Olympics
ADR % Chg, in local currency, YOY during Olympic year
-25%
25%
75%
125%
175%
225%...
ADR Gains, Occupancy Declines
Occ and ADR % Chg, local currency
-20 -10 0 10 20 30 40
Atlanta '96
Sydney '00
Athens '04
Be...
Mixed RevPAR Results, Athens benefitted from games timing and limited supply
YE of each Olympic each year, RevPAR and % Ch...
0.5%
5.4%
December 2013
December 2013
Actual Performance
Actual Performance
Olympic Legacy
London becomes the first city t...
Rising Tides
Q1 2014 RevPAR % change
Global picture Supply & Demand
0
1
2
3
4
5
6
7
8
9
10
North America Central- South America Europe Middle East Africa Asia ...
Spotlight Middle East & Africa
Market performance – Occ %, ADR $ and RevPAR $, March 2014 YTD
Northern Africa
Occ 44.4% -8...
MEA Classes Occ and ADR
$0
$50
$100
$150
$200
$250
$300
$350
$400
0%
10%
20%
30%
40%
50%
60%
70%
80%
Luxury Upper Upscale ...
MEA Markets Occ, ADR % Chg
March 2014 YTD, in local currency
-30%
-25%
-20%
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
Abu Dhabi ...
MEA Markets Occ, ADR
$0
$50
$100
$150
$200
$250
$300
30%
40%
50%
60%
70%
80%
90%
100%
Cairo Beirut Nairobi Lagos Manama Am...
Accelerating Pipeline
Pipeline % increase # of rooms
+7%
+16%
+3%
+40%
+15%
+8%
Accelerating Pipeline
Global Pipeline
# of Rooms
Under Contract:
+1.16 million
In Construction +513k
Final Planning +270k
...
Opportunities in Africa No Branded Supply (Red)
Angola
Burundi
Central African Republic
Comoros
Democratic Republic of Con...
THANK YOU
Impact of mega-events on hotel performance - AHIC 2014
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Impact of mega-events on hotel performance - AHIC 2014

  1. 1. Impact of mega-events on hotel performance Elizabeth Winkle, Managing Director STR Global
  2. 2. Dubai Currently Ranks Amongst Highest ADR Cities ADR and %Chg in USD, YE 2013 -1.3% -0.5% +4.8% -12.5% +3.4% -4.3% -3.2% -1.7% -1.1% +6.5% +3.0% +4.0% 0 50 100 150 200 250 300 350 Beijing Shanghai Los Angeles Tokyo Milan Sydney Greater London Hong Kong Singapore Dubai New York Paris
  3. 3. 0 2 4 6 8 10 12 14 16 18 20 2006 2007 2008 2009 2010 2011 2012 2013 2014 Supply % Chg Demand % Chg Dubai Peak Supply Growth 12 MMA YE 2006 – Jun 2015, % change
  4. 4. Dubai Occ/ADR % Change 12 month moving average YE 2005 to February 2014, in USD -30% -25% -20% -15% -10% -5% 0% 5% 10% 15% 20% 25% 2006 2007 2008 2009 2010 2011 2012 2013 2014 Occ % Chg ADR % Chg
  5. 5. 100 110 120 130 140 150 160 170 180 190 200 -7 years -6 years -5 years -4 years -3 years -2 years -1 year Expo Year Shanghai Milan Dubai Forecast Dubai Scenario Build up to Expo Index of supply growth
  6. 6. Occupancy peaks at Expo start, ADR peaks at closing YOY Occ, ADR % Jan’09 -Mar ’14 (Shanghai excluding Econ Class) ¥500 ¥550 ¥600 ¥650 ¥700 ¥750 ¥800 ¥850 ¥900 ¥950 ¥1,000 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% JanYR-1 MarYR-1 MayYR-1 JulYR-1 SepYR-1 NovYR-1 Jan Mar May Jul Sep Nov JanYR+1 MarYR+1 MayYR+1 JulYR+1 SepYR+1 NovYR+1 JanYR+2 MarYR+2 MayYR+2 JulYR+2 SeptYR+2 NovYR+2 JanYR+3 MarYR+3 MayYR+3 JulYR+3 SeptYR+3 NovYR+3 JanYR+4 MarYR+4 Occ ADR
  7. 7. Often More Displacement than Demand Total Demand and % Changes, YE of each Olympic city +0.8% -1.3% +9.6% -5.9% +2.6% 0 5 10 15 20 25 30 35 40 Atlanta Sydney Athens Beijing Greater London Millions
  8. 8. Occupancy Below 90% Occupancy by month during Olympic Year 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Atlanta '96 Sydney '00 Athens '04 Beijing '08 London '12
  9. 9. Concentrated Rate Growth During Olympics ADR % Chg, in local currency, YOY during Olympic year -25% 25% 75% 125% 175% 225% Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Atlanta '96 Sydney '00 Athens '04 Beijing '08 London'12
  10. 10. ADR Gains, Occupancy Declines Occ and ADR % Chg, local currency -20 -10 0 10 20 30 40 Atlanta '96 Sydney '00 Athens '04 Beijing '08 London '12 OCC ADR
  11. 11. Mixed RevPAR Results, Athens benefitted from games timing and limited supply YE of each Olympic each year, RevPAR and % Chg in USD +8.1% -5.4% +51.5% +6.0% +1.4% $0 $20 $40 $60 $80 $100 $120 $140 $160 $180 $200 Atlanta Sydney Athens Beijing London
  12. 12. 0.5% 5.4% December 2013 December 2013 Actual Performance Actual Performance Olympic Legacy London becomes the first city to achieve post-Olympic RevPAR growth in YR +1 LONDON REGIONAL UK
  13. 13. Rising Tides Q1 2014 RevPAR % change
  14. 14. Global picture Supply & Demand 0 1 2 3 4 5 6 7 8 9 10 North America Central- South America Europe Middle East Africa Asia Australia & Oceania Supply Demand Supply & Demand % Change, March 2014 YTD
  15. 15. Spotlight Middle East & Africa Market performance – Occ %, ADR $ and RevPAR $, March 2014 YTD Northern Africa Occ 44.4% -8.3% ADR $ 80 -4.0% RevPAR $ 36 -11.9% Southern Africa Occ 61.4% -0.3% ADR $ 133 -2.5% RevPAR $ 82 -2.7% Middle East Occ 75.1% +3.3% ADR $ 220 +2.2% RevPAR $ 165 +5.6%
  16. 16. MEA Classes Occ and ADR $0 $50 $100 $150 $200 $250 $300 $350 $400 0% 10% 20% 30% 40% 50% 60% 70% 80% Luxury Upper Upscale Upscale Upper Midscale Midscale & Economy Occ 13 Occ 14 ADR 13 ADR 14+1.2 +2.5-0.4 +0.0 March 2013 & 2014 YTD, in USD +6.5 +2.0 +0.7 +0.2 +1.7 +2.6
  17. 17. MEA Markets Occ, ADR % Chg March 2014 YTD, in local currency -30% -25% -20% -15% -10% -5% 0% 5% 10% 15% 20% 25% Abu Dhabi Amman Beirut Cairo Cape Town Doha Dubai Jeddah Lagos Manama Muscat Nairobi Riyadh Sandton and Surrd. Occupancy ADR
  18. 18. MEA Markets Occ, ADR $0 $50 $100 $150 $200 $250 $300 30% 40% 50% 60% 70% 80% 90% 100% Cairo Beirut Nairobi Lagos Manama Amman Sandton and Surrd. Riyadh Jeddah Abu Dhabi Doha Cape Town Muscat Dubai Occupancy ADR March 2014 YTD, in USD
  19. 19. Accelerating Pipeline Pipeline % increase # of rooms +7% +16% +3% +40% +15% +8%
  20. 20. Accelerating Pipeline Global Pipeline # of Rooms Under Contract: +1.16 million In Construction +513k Final Planning +270k Planning +380k MEA +137k Saudi Arabia +34.9k UAE +34.7k Qatar +9.0k Morocco +6.6k Oman +5.0K Upper Upscale Chains +47.8k Luxury Chains +26.9k Upscale Chains +25.0k Upper Midscale +9.8k Midscale +5.7k Economy +1.1k
  21. 21. Opportunities in Africa No Branded Supply (Red) Angola Burundi Central African Republic Comoros Democratic Republic of Congo Eritrea Liberia Mauritania Niger Republic of Congo Sierra Leone Somalia South Sudan One African Brand (Blue) Burkina Faso (1 hotel) Guinea Bissau (1 hotel) Lesotho (2 hotels) Malawi (1 hotel) Rwanda (2 hotels) Swaziland (3 hotels)Source: STR Global March 2014
  22. 22. THANK YOU

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