Set your Compass: Global Performance Update Elizabeth Winkle Managing Director, STR Global ISHC 2013 Conference 5 October 2013 Interstate Europe @2013 STR Global
Agenda Charting Performance Global Overview West (Europe) East (Far- & Middle-) South (Africa, C&S America) Pipeline
Our coverage As of August 2013 32,385 hotels 3,810,279 rooms 8,068 hotels 1,108,215 rooms 486 hotels 127,280 rooms 672 hotels 106,076 rooms 640 hotels 116,025 rooms 4,688 hotels 961,896 rooms
Global performance As of August 2013 Europe YE11 YE12 YTD 13 5.4% 4.4% 0.5% North America $ YE11 YE12 YTD 13 8.0% 6.4% 5.7% Asia Pacific $ YE11 YE12 YTD 13 3.8% -0.3% -3.8 % Middle East & Africa $ YE11 YE12 YTD 13-2.1% 5.4% 5.5%
BRICs Vs G7 Demand Percent Change Twelve month moving average % change, Ye 2008 to March 2013 25 20 15 Oct 10 19.7% 10 5 0-5 -10-15 May 09-9.5% Aug 09-7.0% Feb 11 7.4% 2008 2009 2010 2011 2012 BRICs G7 Jul 13 2.5% Jul 13 2.0%
USA vs Europe Demand Percent Change 12MMA % change YE 2000 to Mar 2013 Nov 10 6.8% Feb 11 7.7% 10 Aug 13 2.6% 5 0-5 Aug 13 2.4% Mar 02-4.7% Mar 02-5.5% Jul 09-7.3% -10-15 2000 2001 2002 2003 2004 2005 USA 2006 2007 Europe 2008 Aug 09-7.1% 2009 2010 2011 2012
Europe
Europe Room Supply/Demand %Chg 12 months moving average YE 2005 to August 2013 8% Nov 10 6.8% 6% 4% 2% 0% -2% Jun 12 2.1% Aug 13 2.6% -4% -6% Jul 09-7.3% -8% 2005 2006 2007 2008 2009 2010 2011 2012 Supply % Chg Demand % Chg
Europe Occ/ADR %Chg 12 month moving average YE 2005 to August 2013 8% 6% 4% 2% 0% -2% -4% -6% -8% Occ % Chg Jan 11 5.4% ADR % Chg May 11 5.8% -10% Jul 09-12% Nov 09-8.4% -11.5% -14% 2005 2006 2007 2008 2009 2010 2011 2012 Aug 13 1.7% Aug 13-0.1%
Europe RevPAR % Chg 12 month moving average YE 2005 to August 2013 15% 10% 5% May 11 10.9% Aug 13 1.5% 0% -5% -10% -15% Oct 09-18.2% -20% 2005 2006 2007 2008 2009 2010 2011 2012 RevPAR % Chg
Europe actual performance 12 month moving average YE 2005 to August 2013 1,800,000,000 1,600,000,000 1,400,000,000 1,200,000,000 1,000,000,000 800,000,000 600,000,000 400,000,000 200,000,000 0 2005 2006 2007 2008 2009 2010 2011 2012 Supply Demand RevPAR 100 90 80 70 60 50 40 30 20
Europe Classes YTD Aug 2012 & 2013 Occ and ADR 300 250 200 150 100 50 0 Luxury Upper Upscale Upscale Upper Midscale Midscale/Economy 70% 69% 68% 67% 66% 65% 64% 63% 62% 61% 60% Occ 12 Occ 13 ADR 12 ADR 13
European Regions Occ/ADR/RevPAR YTD Aug 2012 & 2013 in YTD 2013 Occ ADR RevPAR Total 67.2 101.97 68.49 Eastern 60.6 84.47 51.22 Northern 72.5 94.16 68.24 Southern 63.1 106.22 67.03 Western 66.1 113.68 75.18 YTD 2012 Occ ADR RevPAR Total 65.6 103.89 68.15 Eastern 58.6 88.30 51.73 Northern 70.0 99.61 69.74 Southern 62.1 103.50 64.24 Western 65.4 113.92 74.53
2005 Feb 06 Apr 06 Jun 06 Aug 06 Oct 06 2006 Feb 07 Apr 07 Jun 07 Aug 07 Oct 07 2007 Feb 08 Apr 08 Jun 08 Aug 08 Oct 08 2008 Feb 09 Apr 09 Jun 09 Aug 09 Oct 09 2009 Feb 10 Apr 10 Jun 10 Aug 10 Oct 10 2010 Feb 11 Apr 11 Jun 11 Aug 11 Oct 11 2011 Feb 12 Apr 12 Jun 12 Aug 12 Oct 12 2012 Feb 13 Apr 13 Jun 13 Aug 13 Eurozone vs Rest of Europe Demand % Chg 12 month moving average % Chg, YE 2005 to August 2013 8% 6% 4% Nov 10 6.8% Jan 11 7.1% Aug 13 3.9% 2% 0% -2% -4% Jul 09-6.3% Aug 13 1.6% -6% -8% -10% Jul 09-8.1% Eurozone Non-Eurozone
Key Cities - Europe YTD August 2013, % Chg Occ and ADR (local currency) 10% 8% 6% 4% 2% 0% -2% -4% -6% Occupancy ADR
Key European Cities YTD August 2013 Occupancy and ADR in 85% 80% 75% 70% 65% 60% 55% 50% 45% 40% 300 250 200 150 100 50 Occupancy ADR
Asia Pacific
Asia Pacific Room Supply/Demand % Chg 12 month moving average YE 2007 August 2013 15% 10% Nov 10 13.9% 5% Aug 13 3.3% 0% -5% Aug 13 2.7% -10% 2008 Jun 09-8.1% Supply Demand
Asia Pacific Occ/ADR %Chg 12 month moving average YE 2007 August 2013 20% Aug 08 16.3% 15% 10% 5% 0% -5% -10% -15% -20% Oct 09-15.8% 2008 2009 2010 2011 2012 2013 Occ Nov 10 9.9% Jan 11 8.0% ADR Aug 13-0.7% Aug 13-2.6%
Asia Pacific RevPAR % Chg 12 month moving average YE 2007 August 2013 20% 15% 10% 5% Dec 10 17.4% 0% -5% -10% Aug 13-3.2% -15% -20% -25% -30% Sep 09-24.0% 2008 2009 2010 2011 2012 2013 RevPAR
Key Cities - Asia Pacific YTD August 2013, % Chg Occ and ADR (local currency) 20% 15% 10% 5% 0% -5% -10% Occupancy ADR
-12.2% -7.0% 2.1% -15.0% -11.3% Asia Pacific YTD August 2013 RevPAR in US$ and % Chg $250-0.5% -2.0% $200-2.5% -3.7% -2.2% $150-11.4% -2.3% 4.8% $100 8.8% 9.9% -0.7% -2.0% $50 $0
Middle East & Africa
Middle East & Africa Regions YE 2012 & YTD Aug 2013 in USD YTD 2013 Occ ADR RevPAR Total 60.9 162.74 99.10 ME 66.1 203.32 134.47 NA 49.7 84.12 41.83 SA 59.3 126.83 75.26 YE 2012 Occ ADR RevPAR Total 60.4 161.17 97.40 ME 64.4 202.50 130.31 NA 52.1 84.86 44.18 SA 59.6 131.94 78.68
ME Select Countries YTD Aug 2013 YOY % Chg, Occ and ADR (local currency) 15% 10% 5% 0% -5% -10% -15% -20% Bahrain Jordan Kuwait Lebanon Oman Qatar KSA UAE Occupancy ADR
ME Select Markets YTD August 2013 Occupancy & ADR in USD 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% $300 $250 $200 $150 $100 $50 Occupancy ADR $ USD
Africa Room Supply/Demand Percent Change Twelve Month Moving Average YE 2005 to July 2013 15 10 5 Supply % Chg Demand % Chg World Cup Effect Arab Spring Rebound 0-5 -10-15 -20 GFC Arab Spring 2005 2006 2007 2008 2009 2010 2011 2012
Africa Occupancy/ADR (USD) Percent Change Twelve Month Moving Average YE 2005 to July 2013 20 15 10 5 0-5 -10-15 Occ % Chg ADR % Chg -20 2005 2006 2007 2008 2009 2010 2011 2012
Africa RevPAR (USD) Percent Change Twelve Month Moving Average YE 2005 to July 2013 25 20 RevPAR % 15 10 5 0-5 -10-15 -20 2005 2006 2007 2008 2009 2010 2011 2012
Key Countries Performance YTD 2013, YoY % change, Occ. and ADR (local currency) 20% 15% 10% 5% 0% -5% -10% -15% Occupancy ADR
Actual Performance Key Cities Occupancy & ADR- USD - YTD 2013 80% 70% 60% 50% 40% 30% 20% 10% 0% $ 300 $ 250 $ 200 $ 150 $ 100 $ 50 $ 0 Occupancy ADR (USD)
Lagos second globally in terms of ADR... YTD 2013 ADR, USD $300 $250 $200 $150 $100 $50 $0
Supply in Africa No Branded Supply Angola Burundi Central African Republic Comoros Democratic Republic of Congo Eritrea Liberia Mauritania Niger Republic of Congo Sierra Leone Somalia South Sudan One African Brand Burkina Faso (1 hotel) Guinea Bissau (1 hotel) Lesotho (2 hotels) Malawi (1 hotel) Rwanda (2 hotels) Swaziland (3 hotels)
Cities with Limited Supply in Africa Maximum two International Branded Hotels Bamako Djibouti Khartoum N Djamena Port Gentil Yaoundé YTD July Performance OCCUPANCY 65.6% ADR - $190.90
Central & South America
Jan-08 Mar-08 May-08 Jul-08 Sep-08 Nov-08 Jan-09 Mar-09 May-09 Jul-09 Sep-09 Nov-09 Jan-10 Mar-10 May-10 Jul-10 Sep-10 Nov-10 Jan-11 Mar-11 May-11 Jul-11 Sep-11 Nov-11 Jan-12 Mar-12 May-12 Jul-12 Sep-12 Nov-12 Jan-13 Mar-13 May-13 Jul-13 Steady demand C. & S. America 12 month moving average Jan 2008 Aug 2013 160,000,000 $100 140,000,000 120,000,000 100,000,000 $90 $80 80,000,000 $70 60,000,000 40,000,000 20,000,000 $60 $50 0 $40 Supply Demand RevPAR
8.2% -7.4% -8.3% 3.6% 5.4% 5.8% 2.3% -4.0% 59.6% 5.8% -12.6% RevPAR in local currency Aug YTD %Chg Honduras Panama Costa Rica Venezuela Colombia Ecuador Peru Brazil Uruguay Chile Argentina
4.2% -7.7% -10.9% 7.8% 10.2% 7.2% 10.5% -3.1% -6.5% -12.1% RevPAR in local currency Aug YTD %Chg San Jose Panama City Quito Bogota Lima Sao Paulo Rio de Janeiro Santiago Buenos Aires Montevideo
-8.5% -7.1% -8.3% 2.0% -4.9% 5.8% -1.0% -3.7% 13.4% 5.8% -12.6% RevPAR in USD Aug YTD %Chg Honduras Panama Costa Rica Venezuela Ecuador Colombia Peru Brazil Uruguay Chile Argentina
-11.9% -7.3% -9.9% -2.4% -3.5% 8.7% 10.5% -6.3% -6.3% -12.2% RevPAR in USD Aug YTD %Chg San Jose Panama City Bogota Quito Lima Rio de Janeiro Sao Paulo Santiago Montevideo Buenos Aires
Pipeline
Top Countries New Opens in Last 5 Years Number of Hotels and Rooms, Top 21 by Rooms Opened (GT 10,000), 2009 through 2013 United States China United Kingdom India United Arab Emirates Germany Indonesia Canada Thailand Mexico Japan Turkey Spain Australia Russia Italy Saudi Arabia France Malaysia Singapore Brazil 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 0 50,000 100,000 150,000 200,000 250,000 300,000 350,000 Rooms US and China far surpass other countries Next group: UK, India, and UAE. Third group: Germany, Indonesia, Canada, Thaliand, and Mexico. Additional countries include: Turkey, Russia, Saudi Arabia, Malaysia, and Brazil. Hotels
Top Global Markets New Opens in Last 5 Years Number of Hotels and Rooms, Top 21 by Rooms Opened (GT 10,000), 2009 through 2013 East China excl Hangzhou South Central China Regional Western China Shanghai Beijing Dubai Northeast China New York, NY Indonesia excluding Bali Greater London North China excl Tianjin Turkey Bangkok Russia Central India Saudi Arabia South India Abu Dhabi Las Vegas, NV Malaysia Singapore Hainan 0 250 500 750 0 25,000 50,000 75,000 Rooms 7 of top 11 markets are in China. 17 of top 21 markets are in Asia and Mideast regions Only other markets: NY, London, Turkey, Russia, and Las Vegas. Hotels
Top Countries with Most Rooms in Active Pipeline Number of Projects and Rooms, Top 21 by Rooms in Active Pipeline (GT 5,000) United States China India United Kingdom United Arab Emirates Saudi Arabia Indonesia Canada Brazil Russia Malaysia Thailand Philippines Germany Mexico Turkey Japan Qatar Australia Vietnam Egypt Morocco 0 500 1,000 1,500 2,000 2,500 3,000 3,500 0 50,000 100,000 150,000 200,000 250,000 300,000 350,000 Number of Rooms US and China still at top. 15 of top 21 countries are in Asia Pacific and Mideast regions Others include: UK, Canada, Brazil, Russia, Germany, and Mexico Number of Projects
Top Global Markets with Most Rooms in Active Pipeline Number of Projects and Rooms, Top 21 by Rooms in Active Pipeline (GT 10,000) East China excl Hangzhou South Central China Regional Western China Saudi Arabia New York, NY Indonesia excluding Bali Hainan Russia Central India Dubai South India Greater London Malaysia Brazil Area Las Vegas, NV Philippines Northeast China Washington, DC-MD-VA Shanghai North China excl Tianjin Delhi-NCR 0 100 200 300 400 500 600 700 0 10,000 20,000 30,000 40,000 50,000 60,000 70,000 Number of Rooms 7 of top 21 markets are in China. 14 of top 21 markets are in Asia and Mideast regions Only other markets: NY, Russia, London, Turkey, Brazil, Las Vegas, and DC. Number of Projects
Top Chains New Opens Outside US in Last 5 Years Number of Hotels and Rooms, Top 20 by Rooms Opened (GT 5000+), 2009 through 2013 JinJiang Inns Home Inn Super 8 ibis Sheraton Hotel Crowne Plaza Holiday Inn Holiday Inn Express Radisson Blu Ramada Hilton Premier Inn Travelodge Courtyard DoubleTree Novotel InterContinental Kempinski Westin Four Points Best Western Park Inn Motel One 0 200 400 600 800 1,000 0 10,000 20,000 30,000 40,000 50,000 Rooms Opened Hotels Opened
Brands with Most Rooms in Non-US Active Pipeline Number of Projects and Rooms, Top 21 by Rooms in Active Pipeline (GT 7500) Hilton DoubleTree Holiday Inn Holiday Inn Express ibis Crowne Plaza Marriott Sheraton Hotel Courtyard InterContinental Hyatt Hilton Garden Inn Shangri-La Radisson Blu JW Marriott Novotel Hampton Inn Four Points Park Inn Pullman Ibis Budget 0 100 200 300 400 500 0 10,000 20,000 30,000 40,000 50,000 Number of Rooms Number of Projects
Takeaways Demand in Europe is at an all time high but rates are static. Eurozone is (slightly) out of recession but still structural issues remain, no real GDP growth until 2015 and beyond Middle East is mixed results, some markets incredibly strong (particularly GCC), developing on-going demand drivers, others impacted by own (or neighbouring) unrest. Africa significant opportunities most markets/countries undersupplied, vast resources, strong GDP growth. Challenges include infrastructure and intraregional connectivity and stability/safety in some countries Asia Pacific rising middle class, younger generation eager to travel and experience local and international destinations. Still a closed society, concerns about shadow finance/potential debt bubble. China s economic growth is slowing, austerity measures in place, less gov t spending. Many markets oversupplied particularly in upper tiers. Domestic brands growing rapidly. Central and South America limited branded supply presents opportunities, inflation, weak and fluctuating currencies create investment risk
Contacts Elizabeth Winkle STR Global +44 (0)207 922 1968 ewinkle@strglobal.com You can follow us on Twitter, Facebook, LinkedIn 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.