Southern Lodging Summit Memphis, TN. Presented by Randy Smith Founder Smith Travel Research

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1 Southern Lodging Summit Memphis, TN Presented by Randy Smith Founder Smith Travel Research

2 Total US - Key Statistics 12-Months Ending July 2012 % Change Hotels 52.3 k Room Supply 1.8 bn 0.4% Room Demand 1.1 bn 3.7% Occupancy 61.0% 3.4% ADR $ % RevPAR $ % Room Revenue $112.3 bn 8.0%

3 Total United States Monthly Room Supply Seasonally Adjusted 1998 to July CAGR 1.7%

4 Total United States Room Supply Percent Change January 2003 July

5 Total United States Monthly Room Demand Seasonally Adjusted 2003 to July CAGR 1.6%

6 Total United States Room Supply/Demand Percent Change Twelve Month Moving Average 1989 to July June % Supply % Change Demand % Change Feb % 4 2 Jan % 3.7% Oct % Mar % Aug % Aug % %

7 Total United States Occupancy Percent Seasonally Adjusted 1998 to July CAGR -0.4%

8 Total United States Occupancy Twelve Month Moving Average 1989 to July Dec June July Aug Jan

9 Total United States Average Daily Rate Twelve Month Moving Average 1989 to July Sept July June

10 Total United States Occupancy/ADR Percent Change Twelve Month Moving Average 1989 to July Jan June Occ % Chg ADR % Chg Mar Aug Oct Sept Apr Jan

11 Total United States RevPAR Seasonally Adjusted 1998 to July CAGR 3.1% $66.98 Nov 2007 $64.21 Jul $54.86 Nov 2000 $55.48 Feb

12 Total United States Key Performance Indicators Percent Change July YTD Supply Demand Occupancy ADR RevPAR

13 Total United States Occupancy and ADR Percent Change July YTD & Weekly through 8/11 8% Occupancy % Chg ADR % Chg 6% 4% 2% 0% 2.9% 4.3% 3.0% 0.1% 3.6% 2.5% 4.0% 3.3% 4.8% 0.8% 3.9% 4.0% 3.4% -2% -4% -3.7% July YTD 7/7 7/14 7/21 7/28 8/4 8/11

14

15 Chain Scales Supply / Demand Percent Change July YTD Supply Demand Luxury Upper Upscale Upscale Upper Midscale -5.4 Midscale Economy

16 Chain Scales Occupancy / ADR Percent Change July 2012 YTD Occupancy ADR Luxury Upper Upscale Upscale Upper Midscale Midscale Economy

17 Chain Scales RevPAR / Room Revenue Percent Change July 2012 YTD RevPAR Room Revenue Luxury Upper Upscale Upscale Upper Midscale Midscale Economy

18 Chain Scale Occupancy Percent July 2012 YTD Luxury Upper Upscale Upscale Upper Midscale Midscale Economy

19 Chain Scale Average Daily Rate ($) July 2012 YTD Luxury Upper Upscale Upscale Upper Midscale Midscale Economy

20

21 Millions Total United States Monthly Transient Demand 2007 Through July Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec NOTE: Data is for upper tier hotels only (luxury chains, upper upscale chains, and upper tier independent hotels).

22 Millions Total United States Monthly Group Demand 2007 Through July Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec NOTE: Data is for upper tier hotels only (luxury chains, upper upscale chains, and upper tier independent hotels).

23 Total United States US Transient vs. Group Monthly ADR ($) January 2007 July 2012 $200 $180 Transient Group $160 $140 $ NOTE: Data is for upper tier hotels only (luxury chains, upper upscale chains, and upper tier independent hotels).

24 Total United States Actual ADR ($) by Customer Segment Year to Date July 2012 $180 $170 $160 $ $ $ $ $ $150 $140 $ $ $ $ $ $ $ $130 Transient Group NOTE: Data is for upper tier hotels only (luxury chains, upper upscale chains, and upper tier independent hotels).

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26 Memphis MSA Room Supply / Demand Seasonally Adjusted January 2003 to July CAGR 0.7% Supply Demand CAGR 1.7%

27 Memphis Occupancy Percent Seasonally Adjusted January 2003 to July %

28 Memphis Market Occupancy Percent July Year-To-Date

29 90 Memphis Room Rate July Year-To-Date $ $80.66 $79.65 $ $75.19 $75.97 $ $65.27 $66.94 $

30 55 Memphis Market RevPAR July Year-To-Date $ $49.11 $49.33 $ $42.25 $42.79 $44.05 $ $37.13 $ Source: STR

31 Memphis Citywide Key Performance Indicators Percent Change July YTD Supply Demand Occupancy ADR RevPAR

32 Memphis Tracts Supply/Demand Percent Change July 2012 YTD Supply Demand Citywide Select CC* Downtown Airport & South East West * Select Center City Properties Subset of Downtown Tract

33 Memphis Tracts Occupancy Percent July 2011 and 2012 YTD Citywide Select CC* Downtown Airport & South East West * Select Center City Properties Subset of Downtown Tract

34 Memphis Tracts Occupancy/ADR Percent Change July YTD Occupancy ADR Citywide Select CC* Downtown Airport & South East -2.9 West * Select Center City Properties Subset of Downtown Tract

35 Memphis Tracts Average Daily Rate July 2012 YTD Citywide Select CC* Downtown Airport & South East West * Select Center City Properties Subset of Downtown Tract

36 Memphis Price Segments Supply/Demand Percent Change July 2012 YTD Supply Demand Citywide Upper Upscale Upscale Upper Midscale -4.3 Midscale Economy

37 Memphis Price Segments Occupancy/ADR Percent Change July 2012 YTD 10 Occupancy 7.9 ADR Citywide Upper Upscale Upscale Upper Midscale Midscale Economy

38 Select Cities Supply/Demand Percent Change July 2012 YTD Supply Demand -10 Memphis Nashville St. Louis Little Rock New Orleans

39 Select Cities Occupancy Percent July 2012 YTD Memphis Nashville St. Louis Little Rock New Orleans

40 Select Cities Occupancy/ADR Percent Change July 2012 YTD 15 Occupancy ADR Memphis Nashville St. Louis Little Rock New Orleans

41 Select Cities Average Daily Rate July 2012 YTD Memphis Nashville St. Louis Little Rock New Orleans

42

43 Annual ADR Grown by CPI Change vs. Actual Annual, CPI Indexed to Actual CPI Adj Source: U.S. Department of Labor: Bureau of Labor Statistics

44 CPI vs. ADR Annual % Chg ADR CPI Source: U.S. Department of Labor: Bureau of Labor Statistics

45 Real ADR (Adjusted for Inflation) Annual, CPI Indexed to : $ : $ Source: U.S. Department of Labor: Bureau of Labor Statistics

46 Real Rate Growth Annual % Chg Source: U.S. Department of Labor: Bureau of Labor Statistics

47 Luxury Scale Annual ADR Grown by CPI Change vs. Actual Annual, CPI Indexed to Actual CPI Adj Source: U.S. Department of Labor: Bureau of Labor Statistics

48 Luxury Scale Real ADR (Adjusted for Inflation) Annual, CPI Indexed to Source: U.S. Department of Labor: Bureau of Labor Statistics

49 Upper Upscale Annual ADR Grown by CPI Change vs. Actual Annual, CPI Indexed to Actual CPI Adj Source: U.S. Department of Labor: Bureau of Labor Statistics

50 Upper Upscale Real ADR (Adjusted for Inflation) Annual, CPI Indexed to Source: U.S. Department of Labor: Bureau of Labor Statistics

51 Upscale Annual ADR Grown by CPI Change vs. Actual Annual, CPI Indexed to Actual CPI Adj Source: U.S. Department of Labor: Bureau of Labor Statistics

52 Upscale Real ADR (Adjusted for Inflation) Annual, CPI Indexed to Source: U.S. Department of Labor: Bureau of Labor Statistics

53 Upper Midscale Annual ADR Grown by CPI Change vs. Actual Annual, CPI Indexed to Actual CPI Adj Source: U.S. Department of Labor: Bureau of Labor Statistics

54 Upper Midscale Real ADR (Adjusted for Inflation) Annual, CPI Indexed to Source: U.S. Department of Labor: Bureau of Labor Statistics

55 Midscale Annual ADR Grown by CPI Change vs. Actual Annual, CPI Indexed to Actual CPI Adj Source: U.S. Department of Labor: Bureau of Labor Statistics

56 Midscale Real ADR (Adjusted for Inflation) Annual, CPI Indexed to Source: U.S. Department of Labor: Bureau of Labor Statistics

57 Economy Scale Annual ADR Grown by CPI Change vs. Actual Annual, CPI Indexed to Actual CPI Adj Source: U.S. Department of Labor: Bureau of Labor Statistics

58 Economy Scale Real ADR (Adjusted for Inflation) Annual, CPI Indexed to Source: U.S. Department of Labor: Bureau of Labor Statistics

59 Independent Scale Annual ADR Grown by CPI Change vs. Actual Annual, CPI Indexed to Actual CPI Adj Source: U.S. Department of Labor: Bureau of Labor Statistics

60 Independent Scale Real ADR (Adjusted for Inflation) Annual, CPI Indexed to Source: U.S. Department of Labor: Bureau of Labor Statistics

61 U.S. Lodging Industry Projections As of August 1, 2012 Smith Travel Research, Inc. and/or STR Global, Ltd. (collectively for these purposes, STR ) are the exclusive owners of all rights in these Industry Presentations and their content. Reproduction of all or a portion of these presentations for any purpose without prior approval of STR is strictly prohibited. This presentation is based on information compiled by STR. No strategic or marketing recommendations or advice are intended or implied.

62 Total United States Active Development Pipeline Rooms Change From Last Year Phase July 2012 July 2011 Difference % Change In Construction 61,490 54,825 6, % Planned Pipeline 239, ,245-28, % Active Pipeline 300, ,070-22, % Planned Pipeline includes projects in Final Planning and Planning phases

63 US Hotel Demand Growth vs. GDP Growth Quarterly Rooms Sold % Chg and GDP % Chg through 2012 Q GDP % Chg Demand % Chg Q Q Q Q Q Q Q Q1 Note: Percentage change is current quarter vs. same quarter last year (GDP in 2005 dollars) Source: BEA

64 Total United States Forecast 2012 / 2013 Key Performance Indicator % Change 2012 Forecast 2013 Forecast Supply 0.5% 1.1% Demand 2.0% 1.8% Occupancy 1.5% 0.7% ADR 4.0% 4.6% RevPAR 5.5% 5.4%

65 Total United States Chain Scale Key Performance Indicator Outlook 2012F by Chain Scale 2012 Year End Outlook Chain Scale Occupancy (% chg) ADR (% chg) RevPAR (%chg) Luxury 2.6% 5.1% 7.9% Upper Upscale 1.5% 4.2% 5.7% Upscale 2.3% 4.6% 7.1% Upper Midscale 1.4% 4.0% 5.5% Midscale 2.8% 1.4% 4.3% Economy 1.4% 3.1% 4.5% Independent 0.5% 3.5% 4.0% Total United States 1.5% 4.0% 5.5%

66 GOP % Total United States Estimated Total Revenue and Profitability Years Revenue Profit GOP% Total Revenue and Profit in Billions

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