bitacp&d east july2013

© 2013 Lodging Econometrics, Portsmouth, NH, USA 603-431-8740, ext. 25

BITACPurchasing and Design East

July 22, 2013 – Monday

Westin Diplomat Resort and Spa, Hollywood, FL

Bruce FordSenior Vice President

Table #68


Boston - July 2013Boston - July 2013


…CBD Market, Top 5 Most Desirable in the US

…Convention Center Hotels, phase 2 beginning in 2014

…Several high-end Ind. hotels recently transacted

…Urban extended stay opening this year

…Heavy renovation cycle coming

Market Highlights


…Boston/Cambridge CBDs have 4,000 of 5,700 new rooms in the Pipeline

…Convention Center/North Station being reconstructed with new demand generators

…Will be a Top 5 construction market for the next three years

New Construction

59%

8%

33%

Early Planning

Under Constr.

Starts Next 12 Mos


…An excellent Independent hotel market

…Everybody wants in, not much for sale

…RevPAR growth +10% annually

…Hotel values reaching all-time highs

…And it will get even better

Other Real Estate News


Boston - July 2013New York City - July 2013


…Bottomless demand equals bottomless new supply

…55% of new hotel rooms will be Upscale and Upper Midscale

…Some aged hotels doing upmarket conversions

…Most transactions require complete overhaul renovation or were recently developed

…Most desirable US market

Market Highlights


…Select Service in CBD growing rapidly

…Times Square 14% and Lower Manhattan 17%, highest percentage growth in 2013-14

…Market-wide 6+% supply growth in 2013-14

…Handful of multiple developers driving supply growth

…Marriott brands have 14 hotels UC in the metro area

New Construction


…Expect Ex-Stay to keep growing in Manhattan

…Owners must renovate to compete

…Rates will soften in the next two years

…Medium-sized and Midscales are most common



Boston - July 2013Miami - July 2013


…Impressive RevPAR growth now makes this market #3 in US

…Extreme competition for hotel redevelopments throughout the metro area

…South Beach largely under branded so far

…Latin American tourism influence very strong

Market Highlights


…YoY 14% new supply increase in Pipeline

…Most favorable Independent construction market in US

…Expect more brand announcements in the coming quarters, rates are too good

…2014 and 2015 New Construction openings numerous and counting

New Construction


…Market is “hot hot hot”!

…International brands want to be here

…Transaction pricing at historic highs

…Will remain Top 5 Market for next several years



Boston - July 2013Orlando - July 2013


…22 Transactions, tops the US in the last 12 months

…Three hotels with 2,700 rooms, 2nd in the US

…5,800 rooms Under Renovation, tops the US

…All of this, not including timeshares!

Market Highlights


…Largest resort, outside of China, Under Construction

…Disney and other multiple owners investing heavily

…Numbers of properties low, room counts high

…The time will come in this cycle for re-development, just not yet

New Construction


…Heavy renovation cycle coming

…Operating performance stable, market in good shape

…Transactions have peaked, discounted properties may not be available

…Conversions likely to pick up in 2014



Boston - July 2013Washington DC - July 2013


…Top new future demand generator market

…Government demand soft, great time to renovate

…Metro projects going slow, but still there

…18 Transactions, 2nd in the US in the last 12 months

Market Highlights


…2nd largest Pipeline in US

…Mostly opening in 2015 and beyond – yet to be financed

…Dominated by Upscale and Upper Midscale

…Lots of new locations where hotels have been before due to metro

New Construction


…Great time to visit, rates have crested

…Government business may keep market soft through 2014

…Conversion market growing rapidly

…International brands want to be here – in CBD



Boston - July 2013Atlanta - July 2013


…Buckhead and GA 400 are best performance areas

…Room night demand at the airport continues to be robust

…CBD select service has largely not happened yet

…Overall market performance still pretty flat

Market Highlights


…Market not really active yet

…Many developers located here, building elsewhere

…Many owners located here, still in waiting

…Everyone would build in Buckhead, do you have any land?

New Construction


…The real story here is renovation – 200+ hotels in the window

…GA 400 has new development opportunities

…Top 2 city for Owner and Management Cos.

…Next couple of quarters bear watching



Presented by: Bruce Ford

Senior Vice President

C: 603.770.5634P: 603.431.8740 x18

E: [email protected]

Thank You!

Please visit our website: www.lodgingeconometrics.com for a complimentary copy of this presentation.

Presented by: Bruce FordThank You!

bitacp&d east july2013

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