Hotel Industry OverviewORLA Convention:

Oregon Lodging Industry Trends Breakout

Allison CowanBusiness Development Associate

Welcome!

Allison CowanBusiness Development Associate

linkedin.com/in/allisoncowan Allie_STR

71%of U.S. rooms participate with STR

STR provides monthly, weekly and daily reports to more than

worldwide hotels, which represent

rooms.

47,000

6.1 million

Raw Data Collected:Total Rooms Available (Supply)

Total Rooms Sold (Demand)

Total Room Revenue (Revenue)

KPIs(Key Performance Indicators)Occ(Occupancy)

ADR(Average Daily Rate)

RevPAR(Revenue per Available Room)

What We Do

Presentation is available for download.

To view this presentation, go to the “Data” drop-down menu on www.HotelNewsNow.com and click “Data Presentations”.

AgendaOctober 14, 2013

• Total U.S. Overview

• State of Oregon

• Deeper Dive Into Oregon

• Pipeline

• Future Performance

• Q&A

Total U.S. Review

Demand Growth Back to Normal. RevPAR Driven by ADR.

% Change

Supply* 1.8 bn 0.7% Demand* 1.1 bn 2.4%Occupancy 62.0% 1.7% ADR* $109 4.0% RevPAR* $68 5.8% Room Revenue* $121 bn 6.6%

Total U.S. – Key Performance Indicators12 MMA through August 2013* All Time High

July 2013: Highest Monthly Room Revenue

EVER($12.2 Billion)

199019911992199319941995199619971998199920002001200220032004200520062007200820092010201120122013-8

-4

0

4

8 Supply Demand

.7%

Favorable Supply / Demand Fundamentals for 2013

-7.1%

-0.9%

- 4.7%

Total U.S. – Supply & Demand % Change12 MMA January 1990 – August 2013

7.7%

2.3%

199019911992199319941995199619971998199920002001200220032004200520062007200820092010 20112012-10

-5

0

5

Demand ADR

7.7%

2.3%

ADR Growth Stalls. Smooth Sailing From Here?

-4.5%

7.5%6.8%

-8.9%

4.0%

Total U.S. – ADR & Demand % Change12 MMA January 1990 – August 2013

Positive RevPAR Growth For The Foreseeable Future

199019911992199319941995199619971998199920002001200220032004200520062007200820092010 201120122013-20

-15

-10

-5

0

5

10

-16.8%

-2.6%

-10.1%

9% 8.6%

Total U.S. – RevPAR % Change12 MMA January 1990 – August 2013

65 Months 36 Mo.112 Months

Inflation Adjusted ADRs Still Not Reached – Yet

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013F

2014F

Nominal ADR2000 / 2008 Grown by CPI

2000 ADR Grown By CPI

Total U.S. – ADR $ and Inflation Adjusted ADR $, 2000 – 2014F2000 – 2012 CPI from bls.gov, 2013– 2014 CPI from Blue Chip Economic Indicators

$85

$101

$104

$85

$107 $116

$107

$1192008 ADR Grown By CPI

$111

State of Oregon

High Growth, Surpassing Peak

Neighboring States: %Change & Actual OCCYTD August 2013

Idaho

Montana

Wyoming

Nevada

Oregon

Washington

California

3.1%

-0.5

-1.8%

3.1%

4.6%

2.7%

2.7%72.3%

62.3%

61.5%

58.8%

63.5%

66.9%

63.4%

California At Least $20 Higher Than Neighbors

Neighboring States: %Change & Actual ADRYTD August 2013

Idaho

Montana

Wyoming

Nevada

Oregon

Washington

California

3.9%

3.6%

3.3%

1.9%

4.8%

4.9%

5.7%

$87.04

$93.18

$104.99

$96.88

$99.08

$109.66

$130.67

Oregon Close To Double Digit RevPAR Growth

Neighboring States: %Change & Actual RevPARYTD August 2013

Idaho

Montana

Wyoming

Nevada

Oregon

Washington

California

7.1%

3.2%

1.4%

5%

9.6%

7.6%

8.6%$94.42

$73.35

$62.79

$61.54

$61.78

$57.27

$54.26

Deeper Dive Into Oregon

Portland Market

Portland Market

Hotels 263Rooms 25,924Sample 89%

Supply 6.3m 0.0%Demand 4.5m* 3.9%Occupancy 72% 4.0%ADR $107* 6.7%RevPAR $77* 11.0%Room Revenue $482m* 10.9%

Portland Mkt: Key Performance IndicatorsAugust YTD 2013*All time high

Supply Not An Issue, Strong Demand Growth Continues

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 -10.0

-5.0

0.0

5.0

10.0

6.4

-2.3

4.0

-4.4

6.3

-9.8

9.2

3.6 %

Supply % Change Demand % Change

Portland Mkt: Room Supply & Demand %Change12MMA 2001 to August 2013

Year After Year of (almost) Continuous Growth

OCC % Change ADR % Change RevPAR % Change

6.9

-1.9

4.9 5.2 4.5

9.9

4.4 5.6

10.3

4.0

6.7

11.0

2010201120122013

Portland Mkt: ADR, OCC & RevPAR %ChangeAugust YTD 2010– 2013

Weekday= Sunday-Thursday

Weekend= Friday & Saturday

Weekday OCC: Chart Topping Rooms Sold

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec40

50

60

70

80

52.7

83%

2007 2010 2011 20122013

Portland Mkt: Actual Weekday OCC by Month2007 & Jan 10’- Aug’13

Weekday ADR: Highest August Rate On Record

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec80

90

100

110

120

$96.07

$116.65

2007 2010 2011 20122013

+$15.80

Portland Mkt: Actual Weekday ADR by Month2007 & Jan 10’- Aug’13

+$6.87

Weekend OCC: August Selling 9 Out Of 10 Rooms

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec40

50

60

70

80

90

100

52.8

93.6%

2007 2010 2011 20122013

Portland Mkt: Actual Weekend OCC by Month2007 & Jan 10’- Aug’13

Weekend ADR: Strong Rate Growth

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec75

85

95

105

115

$87.29

$117.44 2007 2010 20112012 2013

Portland Mkt: Actual Weekend ADR by Month2007 & Jan 10’- Aug’13

+$18.88

+$6.81

Portland Submarkets

Beaverton/Sunset Hwy West:Hotels: 35 Rooms: 2,975

Lake Oswego/ I-5 South:Hotels: 47 Rooms: 3,718

Portland Airport/ Vancouver:Hotels: 84 Rooms: 8,315

Portland Downtown:Hotels: 50 Rooms: 7,499

Portland I-84/ I-205 East:Hotels: 47 Rooms: 3,417

Portland Submarkets: August YTD 2013

Downtown & Beaverton With Strong Performance

Beaverton/Sunset Hwy West

Lake Oswego/ I-5

Portland Airport/ Vancouver

Portland Downtown

Portland I-84/ I-205

10.1

6.4

5.7

7.3

3.7

1.8

5.7

3.9

3.6

5.3

OCC % Chg ADR % Chg

Portland Submarkets: OCC & ADR %ChangeYTD August 2013

62%$75

80%$145

70%$88

68%$96

78%$101

9%+ RevPAR Growth Across the Board

Beaverton/Sunset Hwy West

Lake Oswego/ I-5

Portland Airport/ Vancouver

Portland Downtown

Portland I-84/ I-205

12.2

12.5

9.8

11.2

9.2

Portland Sub-Markets – RevPAR % ChangeYTD Ending August 2013

$45.94

$113.68

$61.06

$64.56

$77.54

Oregon Area Market

Oregon Area Market

Hotels 652Rooms 38,973Sample 55%

Supply 9.4m* 0.4%Demand 5.5m* 5.7%Occupancy 57.9% 5.3%ADR $92* 3.1%RevPAR $53* 8.5%Room Revenue $503m* 9.0%

OR Area Mkt: Key Performance IndicatorsAugust YTD 2013*All time high

Strong KPI= Favorable Supply/Demand

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 -10.0

-4.0

2.0

8.0

2.4

-0.7

2.2 -0.8

-7.1

5.3

0.5

4.5

Supply % Change Demand % Change

Oregon Area Mkt: Room Supply & Demand %Change12MMA 2001 to August 2013

Positive OCC/ADR Mix Across The Board

OCC % Change ADR % Change RevPAR % Change

3.0

0.8

3.8

1.0 1.1

2.2

0.2

2.9 3.1

5.3

3.1

8.5

2010201120122013

Oregon Area Mkt: ADR, OCC & RevPAR &ChangeAugust YTD 2010– 2013

Weekday= Sunday-Thursday

Weekend= Friday & Saturday

Weekday OCC: Still Playing Catch Up From 2007

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec30

40

50

60

70

80

72.2% 2007201020112012

Oregon Area Mkt: Actual Weekday OCC by Month2007 & Jan 10’- Aug’13

Weekday ADR: Breaking Records

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec60

70

80

90

100

110

$ 75.84

$ 102.28

2007 2010 2011 20122013

Oregon Area Mkt: Actual Weekday ADR by Month2007 & Jan 10’- Aug’13

$9.82

$9.33

Weekend OCC: Finally Surpassing Peak

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec30

40

50

60

70

80

90 86.9%

2007 2010 2011 20122013

Oregon Area Mkt: Actual Weekend OCC by Month2007 & Jan 10’- Aug’13

Weekend ADR: Breaking Records…Again

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec60

70

80

90

100

110

120

$77.24

$ 112.33

2007 2010 20112012 2013

Oregon Area Mkt: Actual Weekend ADR by Month2007 & Jan 10’- Aug’13

$9.94

$8.64

Bend/Redmond: Hotels: 60 Rooms: 3,983

Oregon West Area:Hotels: 280 Rooms: 16,462

Eugene MSA:Hotels: 71 Rooms: 4,711

Medford/ Grants Pass:Hotels: 89 Rooms: 5,137

Oregon East Area:Hotels: 152 Rooms: 8,680

Oregon Area Submarkets

Oregon Area Submarkets: August YTD 2013

3 of 5 Submarkets Surpassing Peak

Oregon East Area

Eugene MSA, OR

Oregon West Area

Medford/Grants Pass

Bend/ Redmond

1.6

1.1

2.8

4.1

7.7

6.4

6.3

2.8

6.8

10.3

OCC % Chg ADR % Chg

Oregon Area Submarkets: OCC & ADR %ChangeYTD Ending August 2013

63%

$104

61%

$81

57%

$98

63%

$87

53%$83

Strong RevPAR Growth Across the Board

Oregon Area Sub-Markets – RevPAR % ChangeYTD Ending August 2013

Oregon East Area

Eugene MSA, OR

Oregon West Area

Medford/Grants Pass

Bend/ Redmond

8.1

7.5

5.7

11.2

18.8$66

$49

$56

$55

$44

PipelineIn Construction: Ground has been broken

Final Planning: Construction will begin within 12 months

Planning: Construction will begin within 13-24 months

Pre-Planning: Construction will begin in more than 24 months

Total U.S. – Rooms in Active Pipeline%Change From Last Year

Phase August 2013 August 2012 Difference % Change

In Construction 78,739 66,071 12,668 19.2%

Final Planning 124,591 106,281 18,310 17.2%

Planning 126,337 132,259 -5,922 -4.5%

Active Pipeline 329,667 304,611 25,056 8.2%

Rooms in the Active Pipeline Accelerating

Under Construction Rooms Mostly In Middle Segments

Luxury Upper Upscale

Upscale Upper Midscale

Midscale Economy Unaffiliated

4,690.07,633.0

29,480.0

21,644.0

3,311.01,091.0

10,890.0

Total U.S. – Rooms Under Construction‘000s Rooms, by Scale, August 2013

Portland Market Pipeline Snapshot

Oregon Area Market Pipeline Snapshot

Forecasts

Total U.S. Forecasts (%Change vs. Prior Year)2013 - 2014

2013Forecast

2014Forecast

Supply 0.8% 1.1%

Demand 2.2% 2.4%

Occupancy 1.4% 1.3%

ADR 4.2% 4.6%

RevPAR 5.7% 6.0%

Total U.S.: ADR to Drive RevPAR for the Next 2 Years

Portland Market-STRA Custom Forecast

2013Forecast

2014Forecast

%Chg. %Chg.

Occupancy 70% 4.1 70% 0.5%

ADR $107 7.0% $114 6.8%

RevPAR $75 11.4% $80 7.3%

Oregon Area Market-STRA Custom Forecast

2013Forecast

2014Forecast

%Chg. %Chg.

Occupancy 56% 5.2% 57% 0.5%

ADR $91 3.0% $94 3.3%

RevPAR $50 8.4% $53 5.5%

5 Things to Know

1. Total U.S.- Positive Demand, Rate Driven Recovery

2. Oregon- Strong Performance Across the Board

3. Portland- Setting KPI Highs

4. Oregon Area- Demand Recovering, Rate Driven

Recovery

5. Outlook- Steady As She Goes

Allison Cowanacowan@str.com

615-824-8664 x3420