Smith Travel Research Year-End 2009 Lodging Report Year-end 2009 hotel/motel occupancy was down -9.0% statewide from 2008. This represents a decrease of -12.2% since 2005. o The US occupancy was down -8.6% from 2008. Occupancy in North Carolina 2005-2009 62% 60.0% 60.4% 60% 58% 58.3% 56.3% 56% 54% 52% 50% +2.8% +2.9% +0.7% -6.8% 51.2% -9.0% 48% 46% 2005 2006 2007 2008 2009-12.2% *Occupancy Rooms sold divided by rooms available.
January February March April May June July August September October November December In 2009 monthly hotel/motel occupancy followed the same general trend as in recent years. Historically, statewide occupancy is always higher during the summer months and October. During the first quarter, the gap between 2009 and previous years was substantially larger than last year. However, as the year progressed, and particularly during the fourth quarter, the gap was significantly smaller. In particular, December occupancy was flat as compared to December 2008. Anecdotal information from neighboring states confirms similar trend lines for them. 80% Monthly Occupancy in North Carolina 2006-2009 70% 60% 50% 40% 30% 20% 10% 0% 2006 2007 2008 2009
2009 room rates (ADR) in North Carolina were down -5.6% from 2008. Room rates have decreased -2.3% over the last two years, but are still +13.1% above 2005 rates. o The US ADR was down -8.8% from 2008. $90.00 $75.00 Average Daily Room Rates (ADR) in North Carolina 2005-2009 $84.41 $81.51 $79.65 $75.73 $70.42 $60.00 $45.00 +3.8% +7.5% +7.6% +3.5% -5.6% $30.00 2005 2006 2007 2008 2009 +13.1% *ADR (Average Daily Rate) Room revenue divided by rooms sold.
January February March April May June July August September October November December Room rates (ADR) in North Carolina in 2009 remained below the 2008 levels for the entire year, though still above 2006 rates. During January, February and April, ADR was above 2007, but fell below that base the remainder of the year. $95.00 Monthly ADR in North Carolina 2006-2009 $90.00 $85.00 $80.00 $75.00 $70.00 $65.00 $60.00 $55.00 $50.00 2006 2007 2008 2009
Statewide, Revenue Per Available Room (RevPAR) was down -14.1% from 2008. RevPAR decreased -17.1% over the last two years and -0.5% since 2005. o Nationally, RevPAR was down -16.7%. $55.00 Revenue Per Available Room (RevPAR) in North Carolina 2005-2009 $50.00 $45.44 $49.21 $47.52 $45.00 $41.02 $40.80 $40.00 +6.6% +10.8% +8.3% -3.4% -14.1% $35.00 2005 2006 2007 2008 2009-0.5% *RevPAR Revenue Per Available Room Room revenue divided by rooms available (occupancy times average room rate will closely approximate RevPAR)
January February March April May June July August September October November December While statewide, monthly Revenue per Available Room (RevPAR) was in line with 2006 levels for the first two months of 2009, the remainder of the year it was well below previous years. $70.00 Monthly Revenue Per Available Room (RevPAR) in North Carolina 2006-2009 $60.00 $50.00 $40.00 $30.00 $20.00 $10.00 $0.00 2006 2007 2008 2009
2009 Room Supply was up +2.9% in the state from 2008. Room supply has increased +5.3% since 2005, in a small way leading to some of the decrease in occupancy over that time period. o Nationally, room supply was up +3.2%. 50,000,000 Room Supply in North Carolina 2005-2009 49,750,126 48,621,947 48,920,614 48,511,069 51,185,909 48,000,000 46,000,000 44,000,000-1.3% -0.3% +0.8% +1.7% +2.9% 42,000,000 40,000,000 2005 2006 2007 2008 2009 +5.3% *Room Supply The number of rooms times the number of days in the period.
January February March April May June July August September October November December Room Supply in 2009 followed the same trend line and increased at close to the same rate as last year. Monthly Room Supply in North Carolina 2006-2009 5,000,000 4,500,000 4,000,000 3,500,000 3,000,000 2,500,000 2,000,000 1,500,000 1,000,000 500,000 0 2006 2007 2008 2009
2009 Room Demand was down -6.4% in the state. Since 2005, room demand has decreased -7.4%, all of the decrease occurring during the last two years. o Nationally, room demand was down -5.8%. Room Demand in North Carolina 2005-2009 30,000,000 29,500,000 29,000,000 28,500,000 28,000,000 27,500,000 27,000,000 26,500,000 26,000,000 25,500,000 25,000,000 24,500,000 29,509,250 29,082,633 28,326,368 28,075,933 26,222,409 +1.4% +2.7% +1.5% -4.9% -6.4% 2005 2006 2007 2008 2009-7.4% *Room Demand The number of rooms sold (excludes complimentary rooms).
January February March April May June July August September October November December Similar to hotel occupancy, Room Demand in 2009 lagged behind levels of recent years, particularly during the first and second quarters. The fourth quarter began to show slight promise, as demand at least met 2008 levels in November and December. Due to an increased supply in rooms over the last several years, demand has fared somewhat better than occupancy; meaning a slightly smaller number of people are filling an even larger number of rooms than in previous years. Monthly Room Demand in North Carolina 2006-2009 3,000,000 2,500,000 2,000,000 1,500,000 1,000,000 500,000 0 2006 2007 2008 2009 Smith Travel Research, 2008
North Carolina room revenues were down -11.6% in 2009 from 2008. Room revenues in North Carolina have decreased -13.2% since 2006, but increased +4.7% since 2005. This is due in large part to the increased ADR from 2005-2007, and then a drastic drop the last two years. o Nationally, room revenues were down -14.1%. 2,500,000,000 Room Revenues in North Carolina 2005-2009 2,404,967,126 2,367,853,197 2,202,481,202 2,088,604,733 1,994,624,809 2,000,000,000 1,500,000,000 1,000,000,000 +5.2% +10.4% +9.2% -1.5% -11.6% 500,000,000 0 2005 2006 2007 2008 2009 +4.7% *Room Revenue Total room revenue generated from the sale or rental of rooms.
January February March April May June July August September October November December While North Carolina room revenues were down only -1.5% in 2008 from 2007, a dramatic drop in room rates in 2009 brought revenues down a drastic 11.6% below 2008 revenues. Monthly Room Revenues in North Carolina 2006-2009 300,000,000 250,000,000 200,000,000 150,000,000 100,000,000 50,000,000 0 2006 2007 2008 2009
Methodology While virtually every chain in the United States provides STR with data on almost all of their properties, there are still some hotels that don't submit data. However, every year STR examines guidebook listings and hotel directories for information on hotels that don't provide data. STR calls each hotel in their database every year to obtain "published" rates for multiple categories. Based on this information all hotels are grouped - those that report data and those that don't - into groupings based off of price level and geographic proximity. They then estimate the non-respondents based off of nearby hotels with similar price levels. Glossary ADR (Average Daily Rate) Room revenue divided by rooms sold. Affiliation Date Date the property affiliated with current chain/flag Revenue (Room Revenue) Total room revenue generated from the sale or rental of rooms. RevPAR - Revenue Per Available Room Room revenue divided by rooms available (occupancy times average room rate will closely approximate RevPAR). Census (Properties and Rooms) The number of properties and rooms that exist (universe) Sample % (Rooms) The % of rooms STR receives data from. Calculated as (Sample Change in Rooms Rooms/Census Rooms) * "100". Indicator of whether or not an individual hotel has had added or deleted rooms. Standard Historical TREND Exchange Rate Data on selected properties or segments starting in 1997. The factor used to convert revenue from U.S. Dollars to the local currency. The exchange rate data is obtained from Oanda.com. Any aggregated number in the report (YTD, Running 3 month, Running 12 month) uses the exchange rate of each relative month when calculating the data. STR Code Smith Travel Research's proprietary numbering system. Each hotel in the lodging census has a unique STR code. Demand (Rooms Sold) The number of rooms sold (excludes complimentary rooms). Full Historical TREND Data on selected properties or segments starting in 1987. Occupancy Rooms sold divided by rooms available. Open Date Date the property opened Supply (Rooms Available) The number of rooms times the number of days in the period. Twelve Month Moving Average The value of any given month is computed by taking the value of that month and the values of the eleven preceding months, adding them together and dividing by twelve. Year to Date Average or sum of values starting January 1 of the given year. Percent Change Amount of growth, up, flat, or down from the same period last year (month, ytd, three months, twelve months). Calculated as ((TY-LY)/LY) * "100".