Southern Lodging Summit PDF Free Download

Southern Lodging Summit 2018 U.S. & Memphis Hotel Industry Performance Amanda W. Hite President & CEO ahite@str.com @HiteAmanda 2018 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.

July 2018 RevPAR +1.8% ADR +2.0% Transient RevPAR +1.2% Group RevPAR +1.0% Strongest Monthly Room Demand Ever Recorded 120 Million In Construction Rooms +0.8% July 2018, Total US Results 2018 STR. All Rights Reserved. 3

YTD July 2018: Another Strong Year In The Making Highest Ever? % Change Room Supply 2.0% Room Demand 2.9% Occupancy 67.1% 0.8% ADR $130 2.6% RevPAR $87 3.5% Room Revenue 5.6% Total US Results, July 2018 YTD 2018 STR. All Rights Reserved. 5

Demand Growth Continues. Supply Growth Slow and Steady. 8 7.8 4 0-0.8-4 Supply % Change Demand % Change -8-4.7-7.1 1990 2000 2010 Total U.S., Supply & Demand % Change, 12 MMA 1/1990 07/2018 2018 STR. All Rights Reserved. 6

ADR Growth Steady. Occupancy Growth Leads To New Occ. Records 6.8 7.5 5 0 2.4 1.1-5 -3.4 Occ % Change ADR % Change -6.7-10 1990 2000 2010-9.7 Total U.S., ADR & OCC % Change, 12 MMA 1/1990 07/2018 2018 STR. All Rights Reserved. 7

RevPAR Growth: Erratic Monthly Numbers, But Overall Trend Is Steady 6 Monthly 12MMA 4 2 0 2016 2017 2018 *Total U.S., RevPAR % Change by month and 12 MMA, 1/2016 07/2018 2018 STR. All Rights Reserved. 9

This Expansion Cycle Fueled by High Demand, Low Supply Cycle Period: Dec. 1991 Mar. 2001 Mar. 2010 June 2018 Length (months): 112 100 Avg. Monthly Supply Growth: 2.4 1.0 Avg. Monthly Demand Growth: 2.6 3.4 Avg. Monthly ADR Growth: 4.2 3.4 Avg. Monthly RevPAR Growth: 4.4 5.8 2018 STR. All Rights Reserved. 10

Class: Strong Demand Growth For Luxury And Economy Supply % Change Demand % Change 4.6 5.1 4.7 3.4 3.9 2.2 2.2 2.4 1.3 0.4 0.6 Luxury Upper Upscale Upscale Upper Midscale Midscale Economy -0.2 *Supply / Demand % Change, by Class, July 2018 YTD 2018 STR. All Rights Reserved. 12

Class: Higher Occupancy Growth Spurs Higher ADR Growth 2.9 ADR % Change Occ % Change 2.7 3.2 2.0 2.1 1.8 1.2 0.8 0.9 0.8 0.2 0.4 Luxury Upper Upscale Upscale Upper Midscale Midscale Economy *RevPAR % Change by Contribution of OCC / ADR % Change, by Class, July 2018 YTD 2018 STR. All Rights Reserved. 13

Class: Strong Demand Drives Stellar OCC Results 72.6 71.7 74.0 73.9 73.4 73.1 68.8 68.2 2018 2017 61.6 61.1 59.5 59.0 Luxury Upper Upscale Upscale Upper Midscale Midscale Economy *OCC %, by Class, July 2018 & 2017 YTD 2018 STR. All Rights Reserved. 14

Transient Performance: ADR Growth Seems To Accelerate 4% 3% 2% 1% Demand % Change ADR % Change 0% Jan-17 Jan-18 *Transient Demand and ADR % Change, 12 MMA, 1/2017 07/2018 2018 STR. All Rights Reserved. 16

Group Performance: Group Demand Growth Is Finally Positive(-ish) 4% 3% 2% Easter Shift 1% 0% -1% -2% Jan-17 Demand % Change ADR % Change Jewish Holiday Shift Jan-18 Easter Shift *Group Demand and ADR % Change, 12 MMA, 1/2017 07/2018 2018 STR. All Rights Reserved. 17

YTD Market Performance: Leisure Demand Seems To Allow For Pricing Power Market OCC % ADR % Change Influenced By Miami/Hialeah, FL 80.5 9.3 Leisure and Group Demand Minneapolis/St Paul, MN-WI 67.9 8.3 Super Bowl LII Orlando, FL 81.6 5.8 Leisure Demand San Francisco/San Mateo, CA 82.6 5.6 Group Demand & Easy Comp Atlanta, GA 71.8 4.2 Denver, CO 74.2 0.9 Houston, TX 66.5 0.5 St Louis, MO-IL 65.7 0.1 Boston, MA 73.7-0.6 Washington, DC-MD-VA 73.7-2.5 Inauguration / Women s March Comp *ADR % Change and absolute OCC in Top 25: 5 Best / 5 Worst Performing ADR % Markets, YTD July 2018 2018 STR. All Rights Reserved. 21

US Pipeline: Lack of In Construction Rooms Growth Aids Healthy Industry Results Phase 2018 2017 % Change In Construction 190 188 0.8% Final Planning 223 219 2.0% Planning 195 183 5.8% Under Contract 608 591 2.8% *Total US Pipeline, by Phase, 000s Rooms, July 2018 and 2017 2018 STR. All Rights Reserved. 23

Thousands I/C Pipeline Is Leveling Off Below Prior Peak 250 200 21K 150 100 High: Dec 07 211K July 18 190K 50 Low: May 11 50K 0 2006 2008 2010 2012 2014 2016 2018 *Total US Pipeline; Rooms In Construction, in 000s; 01/2006 07/2018 2018 STR. All Rights Reserved. 24

Limited Service Construction Is The Name Of The Game 72% 59.7 60.3 7.7 23.4 14.8 2.2 22.1 Luxury Upper Upscale Upscale Upper Midscale Midscale Economy Unaffiliated *US Pipeline, Rooms In Construction, 000s Rooms, by Scale, July 2018 2018 STR. All Rights Reserved. 25

Large Markets Grow Rapidly Market Rooms In Construction % Of Existing Nashville, TN 5,210 12% New York, NY 13,389 11% Denver, CO 4,516 9% Dallas, TX 6,337 7% Seattle, WA 3,128 7% *US Pipeline, Rooms I/C and as % of Existing Supply, Largest % In Top 26 Markets, July 2018 2018 STR. All Rights Reserved. 26

Some Smaller MSAs Report Rapid Growth MSA Rooms In Construction % Of Existing Grand Rapids-Wyoming, MI (MSA - 24340) 1,451 14% Austin-Round Rock, TX (MSA - 12420) 3,957 10% Savannah, GA (MSA - 42340) 1,531 10% San Jose-Sunnyvale-Santa Clara, CA (MSA - 41940) 2,636 10% Fresno, CA (MSA - 23420) 752 9% Portland-Vancouver-Hillsboro, OR-WA (MSA - 38900) 2,434 8% Charleston-North Charleston, SC (MSA - 16700) 1,717 8% North Port-Sarasota-Bradenton, FL (MSA - 35840) 793 8% *US Pipeline, Rooms I/C and as % of Existing Supply, Largest % In Top 110 MSAs, July 2018 2018 STR. All Rights Reserved. 27

Supply outpacing Demand % Change Hotels 253 Rooms 23,506 Room Supply 2.0% Room Demand 0.2% Occupancy 65.6% -1.7% A.D.R. $98 2.3% RevPAR $64 0.5% YTD July 2018; Memphis, TN 2018 STR. All Rights Reserved. 29

Occupancy Declines, ADR Growth Steady 8 6 7.2 7.1 Occ % Change ADR % Change 4 3.2 2 0-0.2-2 -4-2.2 2015 2016 2017 2018 Memphis, TN, ADR & OCC % Change, 12 MMA 1/2015 7/2017 2018 STR. All Rights Reserved. 30

Memphis Pipeline: 3,743 / 23,506= 15.9% Rooms In Constr. Final Planning Planning Upper Upscale 130 150 Upscale 390 678 120 Upper Midscale 729 305 248 Midscale 161 269 70 Economy 52 Independent 62 379 Total 1,410 (6%) 1,464 869 2018 STR. All Rights Reserved. 31

Selected Downtown Hotels Residence Inn Memphis Downtown Madison Hotel La Quinta Inns & Suites Memphis Downtown Westin Memphis Beale Street Ascend Collection Hotel Napoleon Courtyard Memphis Downtown River Inn Of Harbor Town Hampton Inn Suites Memphis @ Beale Street The Peabody Memphis Sheraton Hotel Memphis Downtown Springhill Suites Memphis Downtown Holiday Inn Memphis Downtown Beale Street Sleep Inn @ Court Square Memphis Comfort Inn Downtown Memphis Doubletree Hotel Memphis Downtown Crowne Plaza Memphis Downtown Big Cypress Lodge 2018 STR. All Rights Reserved. 33

July 2017 YTD: Strong Demand Growth & All KPIs At Record Levels % Change Hotels 17 Rooms 3,075 Room Supply 2.0% Room Demand -2.5% Occupancy 74% -4.3% A.D.R. $155 4.2% RevPAR $120-0.3% YTD July 2018; Selected Downtown Memphis Hotels 2018 STR. All Rights Reserved. 34

Demand Growth: Erratic Monthly Numbers 18 13 Monthly 12MMA 8 3-2 -7-12 2016 2017 2018 *Selected Downtown Memphis Hotels, Demand Change by month and 12 MMA, 1/2016 7/2018 2018 STR. All Rights Reserved. 35

Declining Occupancies, Rising ADR Growth Rates 10 8 6 4 2 6.8 Occ % Change ADR % Change 4.5 0-2 -4 2015 2016 2017 2018 Selected Downtown Memphis Hotels ADR & OCC % Change, 12 MMA 1/2015 7/2018-2.3 2018 STR. All Rights Reserved. 36

Strong Weekends Continue 12 months end June 2017 84.5 12 months end June 2018 80.5 81.8 79.8 81.9 77.0 75.2 77.9 77.6 74.4 Tuesday Wednesday Thursday Friday Saturday *Selected Downtown Hotels Occupancy % by Selected Day of Week, 12 Months ending July 2017 & 2018 2018 STR. All Rights Reserved. 37

Healthy ADR Push 12 months end July 2017 12 months end July 2018 $157 $159 $158 $152 $153 $149 $163 $169 $167 $173 Tuesday Wednesday Thursday Friday Saturday *Selected Downtown Hotels Occupancy % by Selected Day of Week, 12 Months ending July 2017 & 2018 2018 STR. All Rights Reserved. 38

Both Segments See ADR Growth Rates Climb 7.7 4.4 4.5 3.8 3.2 4.7 4.3 Transient ADR % Group ADR % -3.3 2015 2016 2017 2018 Selected Downtown Memphis Hotels Segmentation ADR % Change, July YTD 2015-2018 2018 STR. All Rights Reserved. 39

Total United States Key Performance Indicator Outlook (% Change vs. Prior Year) 2018F 2019F Outlook Metric 2018 Forecast 2019 Forecast Supply 2.0% 1.9% Demand 2.6% 2.1% Occupancy 0.6% 0.2% ADR 2.6% 2.4% RevPAR 3.2% 2.6% 2018 STR. All Rights Reserved. 41

Total United States Chain Scale Key Performance Indicator Outlook 2018F by Chain Scale 2018 Year End Outlook Chain Scale Occupancy (% chg) ADR (% chg) RevPAR (% chg) Luxury 0.9% 3.0% 3.9% Upper Upscale 0.1% 2.2% 2.4% Upscale -0.1% 2.1% 2.0% Upper Midscale 0.2% 2.0% 2.2% Midscale 0.7% 2.6% 3.3% Economy 0.6% 2.7% 3.3% Independent 0.8% 2.8% 3.6% Total United States 0.6% 2.6% 3.2% 2018 STR. All Rights Reserved. 42

Total United States Chain Scale Key Performance Indicator Outlook 2019F by Chain Scale 2019 Year End Outlook Chain Scale Occupancy (% chg) ADR (% chg) RevPAR (% chg) Luxury -0.1% 2.3% 2.3% Upper Upscale 0.0% 2.4% 2.4% Upscale -0.1% 2.2% 2.1% Upper Midscale 0.0% 2.1% 2.1% Midscale 0.1% 2.1% 2.1% Economy 0.2% 2.1% 2.3% Independent 0.2% 2.3% 2.5% Total United States 0.2% 2.4% 2.6% 2018 STR. All Rights Reserved. 43

Questions? Presentation is available for download. To view this presentation, click STR Data Presentations from the drop-down menu on www.hotelnewsnow.com. 2018 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.