LODGING INDUSTRY OVERVIEW Georgia Lodging Forecast Chad D. Church Industry Research Manager STR June 4, 2009
Agenda Total US overview A look at Southeast states Performance in Georgia Focus on Atlanta US projections
Total US Overview
Total United States Key Performance Indicators Percent Change Year-to-Date April 2009 10 2.2 3.2 5.0 2.6 0-0.1-2.2-10 -8.1-11.0-8.1-20 2008 2009-18.2 Supply Demand Occupancy ADR RevPAR
Total United States 28 Day Moving Average Room Demand % Change Oct 1, 2008 May 23, 2009 4 2 0 Demand ADR -2-4 -6-8 -10-12 10/1/08 12/1/08 2/1/09 4/1/09
Southeast US overview
Southeast US States Supply/Demand Percent Change Year-to-Date April 2009 15 Supply 10 Demand 6.2 6.6 5 3.4 3.5 2.9 2.3 3.1 3.2 0-5 -10-9.1-6.5-6.8-8.6-10.5-8.6-6.3-8.1-15 Georgia Alabama Florida Mississippi North Carolina South Carolina Tennessee Total US
Southeast US States Occupancy Percent Change (w/ actual) Year-to-Date April 2009 Total US -11.0 52.6% Tennessee -9.1 47.0% Florida -10.0 62.8% South Carolina -10.7 48.4% Alabama Georgia -12.0-12.0 52.0% 51.5% North Carolina -13.0 48.8% Mississippi -14.2 52.0% -16-14 -12-10 -8-6 -4-2 0
Southeast US States ADR Percent Change (w/ actual) Year-to-Date April 2009 Total US -8.1 $99.67 Mississippi $73.73 0.9 Alabama -2.7 $72.08 Tennessee -3.6 $77.29 North Carolina -4.8 $77.98 South Carolina -5.6 $78.73 Georgia -6.4 $81.29 Florida -11.4 $121.72-14 -12-10 -8-6 -4-2 0 2
Southeast US States RevPAR Percent Change Year-to-Date April 2009 Total US -18.2 $52.46 Tennessee Mississippi -13.5-12.4 $36.34 $38.32 Alabama -14.3 $37.45 South Carolina -15.7 $38.11 North Carolina Georgia -17.2-17.7 $38.02 $41.90 Florida -20.3 $76.49-22 -20-18 -16-14 -12-10 -8-6 -4-2 0
Performance in Georgia
Georgia Active Development Pipeline - Rooms Change From Last Year Phase April 2009 April 2008 % Change In Construction 6,962 7,538-7.6% Final Planning 2,844 4,020-29.3% Planning 14,378 20,637-30.3% Active Pipeline 24,184 32,195-24.9% Pre-Planning 3,106 5,608-44.6% Total 27,290 37,803-27.8% Source: STR / TWR / Dodge Construction Pipeline
Georgia Tracts Room Supply Change YTD - April 09 vs. April 08-5.0 to -0.1 % 0.0 to 2.9 % 3.0 to 5.9 % 6.0 to 8.9 % 9.0 + %
Georgia Tracts Room Demand Change YTD - April 09 vs. April 08 0.1 + % -4.5 to 0.0 % -7.5 to -4.6 % -9.9 to -7.6 % -20.0 to -10.0 %
Georgia Tracts Occupancy Percent Change YTD - April 09 vs. April 08 0.1 + % -4.5 to 0.0 % -7.5 to -4.6 % -9.9 to -7.6 % -20.0 to -10.0 %
Georgia Tracts ADR Percent Change YTD - April 09 vs. April 08 0.1 to 4.0 % -4.5 to 0.0 % -7.5 to -4.6 % -9.9 to -7.6 % -15.0 to -10.0 %
Focus on Atlanta
10 Atlanta Interior Tracts Supply/Demand Percent Change Year-to-Date April 2009 15 Supply Demand 5 0 4.3 0.0 0.0-0.1-5 -10-15 -20-25 -11.9-15.8-16.6 Downtown Galleria/Marietta Perimeter Ctr/Roswell -3.9-4.3-11.7-20.6-19.1 Airport Buckhead Chamblee/ Norcross
10 Atlanta Surrounding Tracts Supply/Demand Percent Change Year-to-Date April 2009 15 5 0 5.6 4.5 4.4 4.3 2.9 Supply Demand 0.3-5 -10-15 -14.5-14.0-11.7-10.5-6.4-11.0-20 Alpharetta/North Atlanta Northwest Atlanta Northeast Atlanta East Atlanta South Atlanta West
Atlanta Tracts Occupancy Percent Change Year-to-Date April 2009-19.1-17.7-17.4-16.6-15.8-15.6-15.4-15.4-14.1-11.6-11.3-9.0 Alpharetta/North Northwest Buckhead Perimeter Ctr/Roswell Galleria/Marietta Downtown Chamblee/Norcross Northeast East Airport West South -25-20 -15-10 -5 0
Atlanta Tracts ADR Percent Change Year-to-Date April 2009-11.8-10.8-8.7-8.3-7.9-6.4-5.9-5.2-5.1-4.2-3.8 0.0 Perimeter Ctr/Roswell Alpharetta/North Chamblee/Norcross Northeast Galleria/Marietta Buckhead Airport South Downtown East West Northwest -15-12 -9-6 -3 0
Atlanta Tracts RevPAR Percent Change Year-to-Date April 2009-27.8-26.4-22.8-22.6-22.5-22.4-19.9-17.8-17.8-16.8-14.7-13.8 Alpharetta/North Perimeter Ctr/Roswell Chamblee/Norcross Buckhead Galleria/Marietta Northeast Downtown East Northwest Airport West South -30-27 -24-21 -18-15 -12-9 -6-3 0
Total US Projections
Total US Industry Consecutive Quarterly Declines Key Indicators 1990/ 1991 2001/ 2002 Current (Q109) Estimate 2008/09 Demand 3 5 5 7 Occupancy 7 6 6 9 ADR 0 5 2 4 RevPAR 5 5 3 6 Room Revenue 2 5 2 4
5 4 3 2 1 0-1 -2-3 -4-5 Total United States Supply/Demand Percent Change 2003 2010P 1.0 1.3 0.4 4.0-0.1 2.8 0.2 0.5 Supply % Chg 1.3 Demand % Chg 1.0 2.6 2.7-1.2-3.9 1.4 1.9 1.4 1.3 2003 2004 2005 2006 2007 2008 2009P 2010P 20 Yr Average
Total United States Occupancy Percent Change 2003 2010P 4 3.6 2.9 2 0-2 0.3 20 Year Average: -0.6% 0.4-0.2 60.4% 0.0 56.5% 56.5% -4-4.2-6 -8-6.5 2003 2004 2005 2006 2007 2008 2009P 2010P
Total United States ADR Percent Change 2003 2010P 8 6 4 2 0-2 0.2 4.2 5.5 7.5 20 Year Average: 3.5% 6.1 2.5 1.5 $106.68 $102.89 $104.41-4 -3.6-6 2003 2004 2005 2006 2007 2008 2009P 2010P
Total United States RevPAR Percent Change 2003 2010P 8 7.9 8.5 7.8 5.7 3 20 Year Average: 2.9% 0.5 1.5-2 -1.8-7 -12-9.8 2003 2004 2005 2006 2007 2008 2009P 2010P
Lodging Industry Takeaways Supply Growth Pipeline Attrition?...Have we peaked? Increased attrition rate in planning & final planning Airline Woes Decreased routes and capacity impacts fly-in destination significantly Routes may be added back once things improve Gas Prices Will we see summer prices spike? Financial Institutions Impacts much in our industry development, reinvestment, etc.
Questions chad@smithtravelresearch.com www.strglobal.com www.hotelnewsnow.com