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Hotel InduSTRy Overview Vail R. Brown Vice President,  Global Sales & Marketing
Agenda: 18 May 2011 ,[object Object]
  Indiana Hotel Performance
 Indiana Markets & Beyond
 Outlook,[object Object]
ADR Finally Contributing to RevPAR Growth % Change Hotels 			52k		  Room Supply		432 mm		 1.0% Room Demand		237 mm	6.7% Occupancy			54.9%		 	 5.7% A.D.R.		 	$99           	 3.1% RevPAR			$55	 	 	 9.0% Room Revenue		$23.6 bn	10.0% Total U.S.: Key Statistics1st Quarter 2011
Demand Leads ADR….Swings Get More Extreme  1.6% -0.2% -0.9% -4.6% -4.7% -6.9% -8.7% Total U.S.: ADR & Demand % Change Twelve Month Moving Average : Jan. 1989 – March 2011
Absolute ADR Will Not Recover for At Least 2 Years 30 Months -$10.60 41 Months -$3.70 Total U.S.: Actual ADR Twelve Month Moving Average: Jan. 2000 – March 2011
Hopeful ADR growth will continue to drive RevPAR growth 2011 Total U.S. Outlook
Indiana Overview
State’s RevPAR driven by OCC & ADR…good thing. %Change Hotels			961				 Rooms			85,285 STR Sample			76.2% Occupancy			46.5%			  4.6% ADR				$76.42		 	  3.4% RevPAR			$35.54			 8.2% Room Revenue	           	$271.4M		  9.9%	 Indiana: Key Statistics 1st Quarter 2011
Historically: Builds Into Downturns… Indiana: Supply & Demand % ChangeTwelve Month Moving Average: Jan. 2001 – March 2011
IF All Active Pipeline Opens…over 5.5% Room Supply Increase!  Indiana: Active Development PipelineMarch 2011
OCC Growth is Back…ADR Growth much Slower!?  Indiana: OCC & ADR % ChangeTwelve Month Moving Average: Jan. 2001 – March 2011
ADR discounts not as extreme as U.S…BUT still takes time! 31 Months -$4.81 Indiana:Actual ADR ($)  Twelve Month Moving Average: Jan. 2001 – March 2011
Indiana Segments Customer Segmentation:	 ,[object Object]
Group – Rooms booked in blocks of 10 or more.Combine Chain Class:  Aggregate of branded hotels & independents. ,[object Object]
  UpperMidscale/Midscale/Economy,[object Object]
Group Demand & ADR Growth pretty in-sync…A good thing. Indiana: Group Room Demand & ADR % ChangeBy Month: Jan. 2004 – March 2011
2011 STR Chain SegmentsSelected Brands from each segment Luxury – Four Seasons, Ritz Carlton, Fairmont, InterContinental Upper Upscale – Hyatt, Embassy Suites, Hilton, Marriott Upscale – Hyatt Place, Hilton Garden Inn, Courtyard, Hotel Indigo Upper Midscale – Best Western PLUS/Premier, Hampton Inn, Fairfield Inn Midscale – Best Western, Country Inn & Suites, La Quinta Inn, Sleep Inn Economy – America’s Best Inn, Econolodge, Red Roof, Days Inn
Appears to be a Top Down Recovery… Indiana: Combine Chain Class Demand % Change by Month through March 2011
ADR Data is “Less Bad”…need consistent growth.  Indiana: Combine Chain Class ADR % Change by Month through March 2011
Indiana Markets  & Beyond….
Indy new room supply leader… Indiana Markets: Room Supply % Change 12 Month Moving Average  Jan. 2002 – March 2011
Good News: Strong room demand across the board! Indiana Markets: Room Demand % Change 12 Month Moving Average  Jan. 2002 – March 2011
Indy highest OCC % but Gary MSA largest OCC Growth 0.9% 8.7% 2.3% 2.5% 3.3% Indiana Markets & Sub-Markets: Occupancy & % Change1st Quarter 2011
Strong ADR Growth for Evansville-Henderson MSA 3.6% 3.4% 4.2% 7.0% 2.1% 2.8% Indiana Markets & Sub-Markets: Actual ADR & % Change1st Quarter 2011
2012 Outlook …What May Be
Minimal Supply Growth in 2012 Total U.S.: Supply/Demand % Change2005 – 2012P
2012: Hit RevPAR peaks of 2006 (hopefully!) Total U.S. & Chain Scale: 2012 Outlook
Occupancy hitting 60%+ Remains Elusive Total U.S.: Annual Occupancy %  2005 – 2012P

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STR: Hotel Industry Overview

  • 1. Hotel InduSTRy Overview Vail R. Brown Vice President, Global Sales & Marketing
  • 2.
  • 3. Indiana Hotel Performance
  • 5.
  • 6. ADR Finally Contributing to RevPAR Growth % Change Hotels 52k Room Supply 432 mm 1.0% Room Demand 237 mm 6.7% Occupancy 54.9% 5.7% A.D.R. $99 3.1% RevPAR $55 9.0% Room Revenue $23.6 bn 10.0% Total U.S.: Key Statistics1st Quarter 2011
  • 7. Demand Leads ADR….Swings Get More Extreme 1.6% -0.2% -0.9% -4.6% -4.7% -6.9% -8.7% Total U.S.: ADR & Demand % Change Twelve Month Moving Average : Jan. 1989 – March 2011
  • 8. Absolute ADR Will Not Recover for At Least 2 Years 30 Months -$10.60 41 Months -$3.70 Total U.S.: Actual ADR Twelve Month Moving Average: Jan. 2000 – March 2011
  • 9. Hopeful ADR growth will continue to drive RevPAR growth 2011 Total U.S. Outlook
  • 11. State’s RevPAR driven by OCC & ADR…good thing. %Change Hotels 961 Rooms 85,285 STR Sample 76.2% Occupancy 46.5% 4.6% ADR $76.42 3.4% RevPAR $35.54 8.2% Room Revenue $271.4M 9.9% Indiana: Key Statistics 1st Quarter 2011
  • 12. Historically: Builds Into Downturns… Indiana: Supply & Demand % ChangeTwelve Month Moving Average: Jan. 2001 – March 2011
  • 13. IF All Active Pipeline Opens…over 5.5% Room Supply Increase! Indiana: Active Development PipelineMarch 2011
  • 14. OCC Growth is Back…ADR Growth much Slower!? Indiana: OCC & ADR % ChangeTwelve Month Moving Average: Jan. 2001 – March 2011
  • 15. ADR discounts not as extreme as U.S…BUT still takes time! 31 Months -$4.81 Indiana:Actual ADR ($) Twelve Month Moving Average: Jan. 2001 – March 2011
  • 16.
  • 17.
  • 18.
  • 19. Group Demand & ADR Growth pretty in-sync…A good thing. Indiana: Group Room Demand & ADR % ChangeBy Month: Jan. 2004 – March 2011
  • 20. 2011 STR Chain SegmentsSelected Brands from each segment Luxury – Four Seasons, Ritz Carlton, Fairmont, InterContinental Upper Upscale – Hyatt, Embassy Suites, Hilton, Marriott Upscale – Hyatt Place, Hilton Garden Inn, Courtyard, Hotel Indigo Upper Midscale – Best Western PLUS/Premier, Hampton Inn, Fairfield Inn Midscale – Best Western, Country Inn & Suites, La Quinta Inn, Sleep Inn Economy – America’s Best Inn, Econolodge, Red Roof, Days Inn
  • 21. Appears to be a Top Down Recovery… Indiana: Combine Chain Class Demand % Change by Month through March 2011
  • 22. ADR Data is “Less Bad”…need consistent growth. Indiana: Combine Chain Class ADR % Change by Month through March 2011
  • 23. Indiana Markets & Beyond….
  • 24. Indy new room supply leader… Indiana Markets: Room Supply % Change 12 Month Moving Average Jan. 2002 – March 2011
  • 25. Good News: Strong room demand across the board! Indiana Markets: Room Demand % Change 12 Month Moving Average Jan. 2002 – March 2011
  • 26. Indy highest OCC % but Gary MSA largest OCC Growth 0.9% 8.7% 2.3% 2.5% 3.3% Indiana Markets & Sub-Markets: Occupancy & % Change1st Quarter 2011
  • 27. Strong ADR Growth for Evansville-Henderson MSA 3.6% 3.4% 4.2% 7.0% 2.1% 2.8% Indiana Markets & Sub-Markets: Actual ADR & % Change1st Quarter 2011
  • 29. Minimal Supply Growth in 2012 Total U.S.: Supply/Demand % Change2005 – 2012P
  • 30. 2012: Hit RevPAR peaks of 2006 (hopefully!) Total U.S. & Chain Scale: 2012 Outlook
  • 31. Occupancy hitting 60%+ Remains Elusive Total U.S.: Annual Occupancy % 2005 – 2012P
  • 32. What If since 2000 ADR had increased by CPI each year? Total U.S.: Annual ADR 2000 – 2012P Note: 2011 & 2012 CPI forecast from Blue Chip Economic Indicators
  • 33. Takeaways New Hotel Supply Muted in ‘11 & ‘12 Demand Rebounds (Strongly) ADR Growth Started Strong…Keep It Up!? Indiana Transient Rate Growth Needed
  • 34. Thank you! vail@str.com For a copy of this presentation go to www.hotelnewsnow.com