Hotel Performance and Outlook HICAP 2016 Jesper Palmqvist 20 October apinfo@strglobal.com 2016 STR, Inc. All Rights Reserved. Any reprint, use or republication of all or a part of this presentation without the prior written approval of STR, Inc. or STR Global, Ltd. trading as STR (collectively STR ) is strictly prohibited. Any such reproduction shall specifically credit STR as the source. This presentation is based on data collected by STR. No strategic advice or marketing recommendation is intended or implied.
The end is near of the cycle 10% 5% 0% 2010 Feb 2011 2012 2013 2014 2015 2016 RevPAR % Change, Total USA, USD
Not just yet but 2017 seems likely Waning pricing power Transaction volume falling RevPAR growth flattening out Cap rates at historic lows
vs $: -18% European uncertainty post-brexit vote
140 United Kingdom London 120 100 80 2008 2009 2010 2011 2012 2013 2014 2015 YTD Aug '16 UK & London RevPAR Performance (Indexed to 2008) FY 2008 YTD Aug 16, Local Currency
The Middle East and it s new economic outlook Oil price - significant cuts in Government spend A new GDP Big supply pipeline still exist Currency challenges Brexit effect -9.6% RevPAR % Change, August 2016 YTD, USD Constant Currency
Asia Pacific driving occupancy with demand growth 4.7% 3.4% 1.3% -0.2% -1.5% Occupancy ADR RevPAR Supply Demand YTD Aug 16, Constant Current, USD 2016 STR, Inc. All Rights Reserved. www.strglobal.com
APAC regional hotel performance evolution 120 100 Australia & Oceania Central & South Asia 80 Northeastern Asia Southeastern Asia 60 2008 2009 2010 2011 2012 2013 2014 2015 YTD Aug '16 RevPAR Performance (Indexed to 2008) FY 2008 YTD Aug 16, Constant Currency, USD
2016 so far in some cases surprisingly strong 14% 12% 10% 8% 6% 4% 2% 0% New Zealand Vietnam Malaysia India South Korea Thailand Japan Philippines Australia RevPAR growth YoY, Aug 2016, Local Currency 2016 STR, Inc. All Rights Reserved. www.strglobal.com
Supply, Currency and Source market shift 0% Mainland China Singapore Indonesia Hong Kong Taiwan Myanmar Maldives -2% -4% -6% -8% -10% -12% -14% RevPAR growth YoY, Aug 2016, Local Currency 2016 STR, Inc. All Rights Reserved. www.strglobal.com
Big cities growing more than regional mainland China CNY 650 CNY 500 Shanghai World Expo Beijing Shanghai China Mainland Regional CNY 350 CNY 200 2008 2009 2010 2011 2012 2013 2014 2015 2016 RevPAR Performance, Monthly R12, Jan 08 Aug 16, Local Currency
compression opportunity
APAC TOP 5 Compressed Markets Japan, Hong Kong and Singapore lead the way Occ: 80-90% New Zealand Thailand Singapore Hong Kong Japan 97 103 117 119 124 0 20 40 60 80 100 120 140 Occupancy Level within 80% - 90%, YTD Aug 16, Total Room Nights
APAC TOP 5 Compressed Markets And Hong Kong strong at peak levels Occ: 90-100% South Korea 11 New Zealand 34 Singapore Japan 40 44 Hong Kong 56 Occupancy Level within 90% - 100%, YTD Aug 16, Total Room Nights
10% 8% 6% 4% APAC TOP 5 Compressed Markets Who capitalizes the most getting additional ADR during peak days? Occ: 80-90% 2% 0% 10.3% 6.7% 6.6% 5.7% 4.7% Thailand Japan New Zealand Hong Kong Singapore ADR Variation (80% - 90%) vs Non Compression Nights below 80%, YTD Aug 16, Local Currency
25% 20% 15% 10% APAC TOP 5 Compressed Markets Who capitalizes the most getting additional ADR during peak days? Occ: 90-100% 5% 0% 24.7% 18.6% 11.6% 11.2% 5.9% Japan New Zealand Hong Kong SAR South Korea Singapore ADR Variation (90% - 100%) vs Non Compression Nights below 90%, YTD Aug 16, Local Currency
APAC Top 5 Pipeline Countries Vietnam Existing Supply Under Contract Pipeline Australia Malaysia India Indonesia 0 1 2 3 4 As of Aug 16, excl China, based on total rooms number x 100000
Outlook: SG and HK normality by 2018 5% forecast 0% -5% -10% Hong Kong Singapore -15% 2012 2013 2014 2015 2016 2017 2018 2019 2020 Forecast RevPAR % growth, Local Currency, As per Aug 2016
Outlook: Sydney Beijing Tokyo beijing tokyo sydney 2017 2016 0 1 2 3 4 5 6 Forecast RevPAR % growth, Local Currency, As per Aug 2016
summary 2017 the end of the cycle not just in the US Brexit uncertainty in EU - Oil price affecting ME China growth Big city vs Regional variation Thailand leads the way in optimization (SG doesn t) Growth stability likely just at slower pace 2016 STR, Inc. All Rights Reserved. www.strglobal.com
More info and presentations at: HotelNewsNow.com HICAP 2016 Jesper Palmqvist 20 October apinfo@strglobal.com 2016 STR, Inc. All Rights Reserved. Any reprint, use or republication of all or a part of this presentation without the prior written approval of STR, Inc. or STR Global, Ltd. trading as STR (collectively STR ) is strictly prohibited. Any such reproduction shall specifically credit STR as the source. This presentation is based on data collected by STR. No strategic advice or marketing recommendation is intended or implied.