Accommodation Outlook

Bryon MerzeoAustralia & New Zealand Manager

BTTBMay 5, 2011

Who is STR Global?

Data provider - focused on hotel dataDemand, Supply, Profitability, Pipeline.

The world’s largest source of global hotel performance dataCovering over 5,500,000 rooms in over 40,000 hotels, resorts & serviced

apartments worldwide.

Primary Clients IHG • Starwood • Hilton • Hyatt • Marriott • Accor • Shangri-La • Four Seasons

• Mantra • Ascott • Pan Pacific • Worldhotels • Langham • Leading Hotels of

the World • Mirvac • Rydges • Best Western • Choice Hotels • Grand Hotels •

Oaks Group, etc. etc.

Other clientsDevelopment and investment community Hospitality suppliersConsulting firmsHotel associations / NTOs

How it works

HotelsHotel Groups

•Consultants

•Developers

•Financial Inst.

•Governments

•Suppliers

•NTO’s

•others

Market DATA:

•Aggregated data

•Competitive set / market

•Occ/ADR/RevPAR

•Demand / Supply

•Year on Year comparison

•Pipeline

•Aggregated data

•Competitive set / market

•Occupancy

•ADR

•RevPAR

•Index (MPI, ARI, RGI)

•Rank

•Year on Year comparison

•YTD / MTD

•Day of week

•Weekend / Weekday

Benchmark Reporting

DATA:

•Rooms sold

•Rooms revenue

•Pipeline

•Profitability

Year End 2009...RevPar year-on-year % change

-16.7%North America

Europe

Asia Pac

Middle East/Africa-17.0%

-19.4%

-13.3%

One year later.Year End 2010, RevPar year-on-year % change

+9.9%

North America

Europe

+6.1% +21.3%

+4.0%

Asia Pac

Middle East/Africa

Growth ContinuesYTD March 2011, RevPar year-on-year % change

+8.9%

North America

Europe

+8.6% +12.8%

+0.9%

Asia Pac

Middle East/Africa

% change, Local Currency. Year end 2010

-20% -10% 0% 10% 20% 30% 40% 50%

Bangkok

Bali

New Delhi

Seoul

Tokyo

Sydney

Singapore

Beijing

Hong Kong

Shanghai

Occupancy Average room rate

Asia Key Markets - 2010

% change, Local Currency. YTD as of March 2011.

-20% -10% 0% 10% 20% 30% 40% 50%

Bangkok

Bali

New Delhi

Seoul

Tokyo

Sydney

Singapore

Beijing

Hong Kong

Shanghai

Occupancy Average room rate

Asia Key Markets – YTD 2011

YTD

Occupancy

Total Rooms

Measured

Nightly

Rooms

Available

Sydney 84.6 22,376 3,356

Melbourne 79.4 13,871 2,774

Brisbane 75.8 5,190 1,245

Perth 82.4 5,085 915

Canberra 77.1 2,500 575

Average room availability

Total of 335,300 rooms in the pipeline

Asia Pacific Pipeline

56%21%

5%4%

4%2% 1%

3%

4%

RoomsChina

India

Thailand

Indonesia

Vietnam

Philippines

Australia

Malaysia

Others

Room supply in China will increase about 16% over the next 3-4 years.

India - an increase of just under 50%.

187,750 rooms

$100

$120

$140

$160

$180

$200

$220

$240

$260

$280Top End Upscale Midscale

Past 15 months

Melbourne ADR by Market Class

$96

$22

100

120

140

160

180

200

220

240

260

280

300Topend Upscale Midscale

Past 15 months

Sydney ADR by Market Class

$80

$24

Day of Week Rate Variations YTD 2011

$19

We can expect...

$25

Day of Week Rate Variations YTD 2011

0

2

4

6

8

10

12

Mon Tue Wed Thu Fri Sat Sun

Sydney vs. MelbourneDay of Week Rate Growth – YoY % Change, YTD 2011

$5

$25Sydney

Melbourne

%

%

%

%

%

%

%

1st June 16 Wed $315

2nd Feb 25 Thu $207

3rd Feb 27 Sat $202

4th May 18 Tue $200Science Conference, Biffy

Clyro Concert, etc

5th May 19 Wed $195 Mixed Conferences

Revenue Super Stars: Brisbane

Best Performing Days by RevPAR of 2010

53 Days above 95%

Occ in past year

Only 260 rooms

available!

Note: Annual RevPAR was $138

Sydney CBD is nearly Sold Out! (Often)

Best Performing Occupancy Days -past 365 days

Date DOW Occ

12/31/2010 Fri 98.5

10/14/2010 Thu 98.5

10/21/2010 Thu 98.4

02/22/2011 Tue 98.4

10/23/2010 Sat 98.2

02/16/2011 Wed 98.2

02/08/2011 Tue 98.1

10/13/2010 Wed 98.1

08/07/2010 Sat 98.1

07/31/2010 Sat 98.1

12/02/2010 Thu 98.0

10/26/2010 Tue 98.0

11/16/2010 Tue 98.0

84 Days above 95%

Occupancy...

Only 763 rooms

available!

North Sydney

79% $171

Sydney CBD

88% $208

Outer Sydney

77% $158

Sydney variations by regionYTD Occupancy and ADR

Sydney Seasonality Average Rate

140

150

160

170

180

190

200

210

Sydney Seasonality – 2008 to 2009Average Rate

140

150

160

170

180

190

200

210

Sydney Seasonality – 2008 to 2010Average Rate

140

150

160

170

180

190

200

210

Sydney Seasonality - 2008 to 2011Average Rate

140

150

160

170

180

190

200

210

2011

Dynamic Pricing vs. Static rate

140

150

160

170

180

190

200

210

Dynamic Pricing: set discount % should result

in less restrictions & more availability

140

150

160

170

180

190

200

210

Segmentation Program Definitions-Customer Type

Group

Includes rooms occupied which were sold simultaneously in blocks of a minimum

of ten (10) rooms or more (e.g. group tours, domestic and international groups,

association, convention and corporate groups, SMERF group business).

Contract

Rooms occupied at rates that are stipulated by contracts including airline crews, on-

going training seminars and permanent guests. Room allotments that do not require

guaranteed use or payment should not be classified as contract. Rooms sold under

such allotments should be classified as transient.

Transient

Includes rooms occupied by those with reservations at Rack, Corporate, Corporate

Negotiated, Package, Government, or foreign traveller rates. Also includes

occupied rooms booked via third party web sites (exception: simultaneous bookings of

ten or more rooms which should be defined as group).

Sydney Occupancy by Segment

Transient

Contract

Group

A lesson in the risk of discounting rates

Profit is driven first by high rates, not full hotelsBy Lana Yoshii - Vice President Product Development, STR

$5 Rate drop

=

$40,000 decrease in

Operating Profit

Tools for Hotel Buyers: Full suite of reports

• Partial recovery of 2010 is continuing in 2011

• Corporate & Leisure demand is back and growing

moderately

• Supply growth across Asia, with China and India at the

front. Minimal new supply for Australia key markets

• Strong demand, undersupply in Australia business

markets = limited group availability

• Australia resort destinations feel pressure of $,

oversupply

• Hotels aim to maximize favorable opportunities, Rate

growth of 10%+

Summary

Questions?

Should you be interested in the data/reports used to create this presentation,

please contact me:

Bryon Merzeobmerzeo@strglobal.com