STR Global Hotel Performance Trends

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Information about STR Global Hotel Performance Trends
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Published on July 5, 2013

Author: STR_Global

Source: slideshare.net

Description

This presentation gives an overview of the global markets in terms of hotel performance. Key cities worldwide are highlighted and the pipeline for hotel rooms is analyzed. Additionally an outlook is provided and global trends are mentioned. The presentation was held at Ecole hôtelière de Lausanne, a leading hospitality education institution.

STR Global Hotel Performance Trends Naureen Ahmed, Manager, Marketing and Analysis 28th May 2013 EHL, Strategy Workshop

Our coverage in 166 countries As of March 2013 639 hotels 101,610 rooms 622 hotels 109,768 rooms 3,838 hotels 860,968 rooms 7,751 hotels 1,089,939 rooms 460 hotels 120,153 rooms 1,038 hotels 136,112 rooms 32,066 hotels 3,800,452 rooms

1.40 4.70 6.30 2.20 6.50 0.80 -4% -2% 0% 2% 4% 6% 8% 10% 12% 14% 0% 1% 2% 3% 4% 5% 6% 7% 8% Solid demand growth – except CSA YE 2012, YoY % change, supply, demand, RevPAR Africa Middle East Asia Pacific SUPPLY D E M A N D Europe € North America Central & South America

Emerging markets Leading RGI Index on YE 2008, US dollars, only Europe in Euros 0.6 0.7 0.8 0.9 1 1.1 1.2 YE 2007 YE 2008 YE 2009 YE 2010 YE 2011 YE 2012 Africa Europe Middle East N. America Asia Pacific CSA

RevPAR % change Worldwide RevPAR Europe € YE11 YE12 Q1 13 5.8% 4.8% 0.1% Asia Pacific $ YE11 YE12 Q1 13 9.8% 1.4% -2.5% North America $ YE11 YE12 Q1 13 8.0% 6.5% 6.2% Middle East & Africa $ YE11 YE12 Q1 13 -1.8% 5.2% 9.2%

USA Vs Europe Demand Percent Change 12 Month Moving Average % change YE 2000 to March 2013 -15 -10 -5 0 5 10 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 USA Europe Nov ‘10 6.8% Mar ‘13 1.1% Feb ‘11 7.7% Mar ‘13 2.6% Jul ‘09 -7.3% Aug ’09 -7.1% Mar ‘02 -4.7% Mar ‘02 -5.5%

-8 -6 -4 -2 0 2 4 6 8 10 Occupancy ADR Key Cities - WW YTD March 2013, %chg, Occ and ADR (local currency)

WWCities– how has 2013 begun? YTD March 2013 Occupancy % & ADR USD $0 $50 $100 $150 $200 $250 $300 0 10 20 30 40 50 60 70 80 90 100 Occupancy ADR $

Outlook

Global Pipeline - % of Total by Region 37.1% 3.6% 2.0% 12.9% 11.5% 32.9% Asia Pacific Caribbean/Mexico Central/S. America North America Europe Middle East & Africa March 2013, share on active pipeline # of rooms

Global Pipeline March 2013, share on active pipeline by # of rooms 15.0% 20.5% 31.8% 22.5% 6.4% 3.7% Luxury Upper Upscale Upscale Upper Midscale Midscale Economy

Expect Slowing Eurozone GDP / Demand % Change -15 -12 -9 -6 -3 0 3 6 9 2004 2009 2014 GDP Demand *Eurozone Demand & GDP % Change, Quarterly 2004 – 2014F GDP Source: Oxford Economics

Forecast – Selected Cities 2013 RevPAR forecast % chg, local currency as per February 2013 edition Declines expected Growth expected Athens Amsterdam Birmingham Beijing Copenhagen Barcelona Edinburgh Hong Kong Dusseldorf Berlin Glasgow Singapore Frankfurt Brussels Heathrow Sydney Madrid Cologne Leeds Tokyo Prague Dublin Manchester USA Warsaw Hamburg Regional UK London Milan Stuttgart Gatwick Moscow Vienna Dubai Munich Zurich Paris Lux & Up Up Rome

Global Trends

-20 -10 0 10 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 Positive RevPAR Growth: Three More Years (?) -16.8% -2.6% -10.1% 9% 8.6% Total U.S.: ADR & Demand Percent Change Twelve Month Moving Average –1990 – March 2013 65 Months 31 Mo.112 Months Source: STR

RevPAR (Slowly) Catches Up To Prior Record Highs $213 $113 $84 $62 $44 $31 $206 $120 $84 $62 $41 $29 Luxury Upper Upscale Upscale Upper Midscale Midscale Economy 2007 Q1 2013 U.S. Chain Scales: RevPAR $, by Scale, YE 2007 & 12 Months Ending Q1 2013 Source: STR

$85 $104 $107 $85 $102 Nominal ADR 2000/2008 ADR Grown by CPI 2000 ADR Grown by CPI 2008 ADR Grown by CPI $107 Source: STR Total U.S. Room Rates Actual vs. Inflation Adjusted 2000 – 2014F Note: 2012 & 2013 CPI forecast from Blue Chip Economic Indicators $119 $116 Inflation Adjusted ADRs Well Out Of Reach $111 $116

Total U.S.: Rooms In Construction by Scale – In Thousands March 2013 4.7 7.1 25.8 19.8 3.5 1.0 10.5 Luxury Upper Upscale Upscale Upper Midscale Midscale Economy Unaffiliated Under Construction Rooms Mostly In Middle Segments Source: STR

Steady demand – Central & South America 12 month moving supply, demand (# monthly rooms), RevPAR $ Source: STR Global $0 $10 $20 $30 $40 $50 $60 $70 $80 $90 $100 2,000,000 22,000,000 42,000,000 62,000,000 82,000,000 102,000,000 122,000,000 142,000,000 162,000,000 Jan-08 Apr-08 Jul-08 Oct-08 Jan-09 Apr-09 Jul-09 Oct-09 Jan-10 Apr-10 Jul-10 Oct-10 Jan-11 Apr-11 Jul-11 Oct-11 Jan-12 Apr-12 Jul-12 Oct-12 Jan-13 Supply Demand RevPAR

CSA Classes 2.2 1.8 4.8 1.8 1.7 1.0 -2.3 -1.2 -3.7 -1.8 -2.6 -0.8 CSA Luxury Upper Upscale Upscale Upper Midscale Midscale & Economy Supply Demand Classes: Supply / Demand % Change, Q1 2013

Pipeline: Top 2 by class Source:STR / STR Global Luxury & Upper Upscale 9% Upscale 10% Upper Mid & Midscale 59% Economy 10% Unaffiliated 12% Brazil Luxury & Upper Upscale 43% Upscale 26% Upper Mid & Midscale 21% Unaffiliated 10% Panama

Class comparison – Sao Paulo vs Rio 173 333 345 Midscale and economy Upscale and upper midscale Luxury and upper upscale 12-MO to Mar 2013, RevPAR BRL 131 156 334 Luxury and upper upscale Upscale and upper midscale Midscale and economy Rio de Janeiro Sao PaoloLuxury 465 Luxury 423

Europe Room Supply/Demand Percent Change Twelve Month Moving Average – YE 2005 to March 2013 -8 -6 -4 -2 0 2 4 6 8 2005 2006 2007 2008 2009 2010 2011 2012 Supply % Chg Demand % Chg Mar ‘13 1.1% Mar ‘13 1.1% Mar ‘12 6.2% Jul ‘08 -7.3%

Europe Occupancy/ADR Percent Change Twelve Month Moving Average – YE 2005 to March 2013 -14 -12 -10 -8 -6 -4 -2 0 2 4 6 8 2005 2006 2007 2008 2009 2010 2011 2012 Occ % Chg ADR % Chg Mar ‘13 3.9% Mar ‘13 0.1% May ‘10 5.8%Apr ‘10 5.1% Sep ’08 -8.4% Nov ‘08 -11.5%

Europe Room RevPAR Percent Change Twelve Month Moving Average – YE 2005 to March 2013 -20 -15 -10 -5 0 5 10 15 2005 2006 2007 2008 2009 2010 2011 2012 RevPAR % Chg Mar ‘13 4.0% May ‘10 10.9% Oct ‘08 -18.2%

26 European Regions Occ/ADR/RevPAR YTD 2012 & YTD 2013 YTD, 2013 Occ ADR RevPAR Total 58% €96 €56 Eastern 49% €84 €41 Northern 64% €88 €56 Southern 53% €92 €49 Western 58% €113 €66 YTD, 2012 Occ ADR RevPAR Total 57% €97 €56 Eastern 48% €86 €41 Northern 62% €91 €57 Southern 53% €90 €47 Western 58% €115 €67

-4.0 -3.0 -2.0 -1.0 0.0 1.0 2.0 3.0 4.0 5.0 Occupancy ADR UK Classes Occupancy/ADR Percent Change YTD to May 11 2013 based on Daily Data

0 100,000200,000300,000400,000500,000600,000700,000 United Kingdom Russia Germany Turkey Netherlands Italy Poland France Spain Austria Existing Pipeline Development Pipeline - Europe # daily rooms, March 2013 pipeline

Year End 2012 and YTD March 2013 Middle East & Africa Regions YE, 2012 Occ ADR RevPAR Total 60% $162 $98 M.E. 64% $204 $132 N. Africa 52% $85 $44 S. Africa 60% $132 $78 YTD 2013 Occ ADR RevPAR Total 64% $179 $115 M.E. 72% $224 $162 N. Africa 48% $85 $41 S. Africa 62% $136 $84 Source: STR Global

Key Countries – Africa YE 2012, YoY % change, Occ. and ADR (local currency)

ME Classes €0 €50 €100 €150 €200 €250 €300 €350 €400 €450 69.0 70.0 71.0 72.0 73.0 74.0 75.0 76.0 77.0 78.0 Q1 2013 A D R Occupancy Upscale/upper midscale Midscale/economy Luxury Upper Upscale

Selected Cities – Supply Increase - ME Rooms in active pipeline as % of existing supply 0% 20% 40% 60% 80% 100% Riyadh Jeddah Makkah Muscat Abu Dhabi Al Khobar Doha Manama Dubai Cairo Amman Medina Beirut Supply increase 0% 20% 40% 60% 80% 100% Riyadh Jeddah Makkah Muscat Abu Dhabi Al Khobar Doha Manama Dubai Cairo Amman Medina Beirut

Selected Countries – supply increase - Africa Rooms in active pipeline as % of existing supply

Asia Pacific Overview 2012 Year End RevPAR growth India: -5.1% Vietnam: -2.7% Maldives: 10.9% Thailand: 15.4% Malaysia: 2.3% Singapore: 4.6% Indonesia: 8.0% S. Korea: 6.9% Japan: 13.2% China mainland: -1.7% Taiwan: 5.0% Philippines: 2.3% Australia: 3.9% Asia Pacific RevPAR: $88 (up 0.9% vs. 2011) Hong Kong: 4.2%

50 55 60 65 70 75 80 85 90 95 100 $50 $100 $150 $200 $250 $300 RevPAR 2.5% 22% 5.7% 1.4% 3.4% 3.1% -16% 12% 5.4% 15.7% 8.2% 13% 19.3% Asia Pacific Luxury & Upper Upscale Year end 2012 RevPAR in $ and % Chg Source:STR Global

China Room RevPAR Percent Change Twelve Month Moving Average – YE 2007 to March 2013 (Excluding Economy) -40 -30 -20 -10 0 10 20 30 2007 2008 2009 2010 2011 2012 RevPAR % Chg Mar ‘13 -1.4% Nov ‘09 25.5% Aug ‘08 -30.0%

China Hotel Overview Year End 2012 Supply and Demand % Change 0.0 0.0 0.0 0.0 0.0 0.1 0.1 0.1 0.1 0.1 Luxury Upper upscale Upscale Upper Midscale Midscale Supply %Chg Demand %Chg Source: STR Global

China Pipeline Vs. Existing 56.0% 54.5% 32.7% 9.3% 0 50000 100000 150000 200000 250000 300000 350000 400000 450000 Luxury Upper Upscale Upscale Upper Mid Column1 Pipeline 62.3% 60.0% 59.7% 62.0%

STR Global, Ltd is the exclusive owner of all rights in this presentation and its content. Reproduction of all or a portion of this presentation for any purpose without prior approval of STR Global is strictly prohibited. This presentation is based on information compiled by STR Global Ltd. No strategic or marketing recommendations or advice are intended or implied. Contact details Naureen Ahmed 0207 922 1930 nahmed@strglobal.com www.strglobal.com You can follow us on Twitter, Facebook, LinkedIn

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