NYU International Hospitality Industry

Investment Conference

Amanda W. Hite STR

President & COO

Supply

Middle East Leads in Development

2.5

1.0

5.9

1.2

3.8

1.1

0

2

4

6

Central- SouthAmerica

Europe Middle East Africa Asia Australia &Oceania

Supply % Change, April 2014 YTD

Supply Growth Creeps Up

-1

0

1

2

3

4

5

6

1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012

Total U.S., Supply % Change, 12 MMA 1/1990 – 4/2014

U.S. Pipeline: Construction Accelerates

Phase 2014 2013 % Change

In Construction 103 72 42.6%

Final Planning 130 101 29.3%

Planning 150 157 -4.8%

Under Contract 383 330 16%

Total U.S. Pipeline, by Phase, ‘000s Rooms, April 2014 and 2013

Under Construction Rooms Mostly In Middle Segments

4.4 8.6

38.9

31.3

5.3

0.9

14.0

Luxury UpperUpscale

Upscale UpperMidscale

Midscale Economy Unaffiliated

U.S. Pipeline, Rooms Under Construction , ‘000s Rooms, by Scale, April 2014

68%

10 of Top 26 Markets With 2%+ Of Supply

U.S. Pipeline, Top 26 Markets, U/C Rooms as % of Existing Supply, March 2014

Market Rooms UC % Of Existing

Anaheim-Santa Ana, CA 1,167 2.2%

Dallas, TX 1,785 2.3%

Washington, DC-MD-VA 2,500 2.3%

Boston, MA 1,250 2.4%

Los Angeles-Long Beach, CA 2,971 3.1%

Houston, TX 3,259 4.3%

Seattle, WA 1,889 4.6%

Denver, CO 1,981 4.8%

Miami-Hialeah, FL 2,442 5.0%

New York, NY 13,230 12.0%

Total United States Supply Outlook (% Change vs. Prior Year), 2014 - 2015

U.S. Supply Outlook

2014 2015 1.2% 1.6%

Demand

Middle East Leads Demand Growth

1.5

3.5

9.9

-2.3

4.3 3.7

-5

-2

1

4

7

10

Central- SouthAmerica

Europe Middle East Africa Asia Australia &Oceania

Demand % Change, April 2014 YTD

U.S., Room Demand % Change, 12 Month Moving Average: 89 to March 14

-8

-6

-4

-2

0

2

4

6

8

10

2009 2011 2013

Feb ’11 7.7%

Sept ’09 -7.1%

Demand Growth is Steady

Apr ‘14 2.5%

U.S. Chain Scales, Demand % Change, Twelve Months Ended April 2014

1.4

2.8

4.9

2.3 2.5

1.6

-2

0

2

4

6

Luxury Upper Upscale Upscale UpperMidscale

Midscale Economy

Upscale Leads Demand Growth

Transient Occupancy Share Increases

43% 57%

2005

Group

Transient

36%

64%

2013

Group

Transient

*Transient and Group Occupancy as Share of Total OCC, 2005 and 2013

Occupancy Segmentation by Class: Groups Finally Returning?

1.1

2.7

1.5 1.4

Luxury Upper Upscale

Transient % Change Group % Change

*Segmentation Occupancy % Change, by Class, April 2014 YTD

Total United States Demand & Occupancy Outlook (% Change vs. Prior Year) 2014 - 2015

U.S. Demand Outlook

2014 2015 Demand 2.6% 2.2% Occupancy 1.4% 0.6%

Average Daily Rate

Select Global Regions ADR Percent Change (In US Dollars except Europe in Euros), April 2014 YTD

-3.9

1.9 3.0

-1.4 -2.0

-8.3

Middle East Leads in Rate Growth

Steady ADR Growth As Room Demand Growth Continues

-10

-5

0

5

2008

Demand % ChangeADR % Change

-4.5%

3.7%

Total U.S., ADR & Demand % Change, 12 MMA 1/2008 – 4/2014

Scales: ADR Growth Healthy, Especially For Luxury

4.9

4.2 4.0

3.2 3.3

3.9

Luxury Upper Upscale Upscale Upper Midscale Midscale Economy

Total U.S. Chain Scales: ADR % Change, April 2014 YTD

Total United States Actual ADR ($) by Customer Segment, YTD 2010- April 2014

$165.88

$159.93

$175.84

$163.63

$183.93

$169.19

$193.45

$175.76

$203.19

$180.33

$150

$160

$170

$180

$190

$200

Transient Group

2010 2011 2012 2013 2014

NOTE: Data is for luxury and upper upscale classes only.

Strong Transient Room Rate Growth

April 2014 YTD ADR % Change in Top 25: 5 Best / 5 Worst Performing Markets

Market ADR $ ADR % Change Nashville, TN 113.22 13.2

San Francisco/San Mateo, CA 187.54 10.3 Denver, CO 105.78 7.8

Miami/Hialeah, FL 227.68 6.7 Boston, MA 156.51 6.2

New York, NY 227.39 1.6 Norfolk/Virginia Beach, VA 74.16 0.7

New Orleans, LA 160.22 0.1 Chicago, IL 112.11 -0.4

Washington, DC-MD-VA 146.29 -4.3

Total United States ADR Outlook (% Change vs. Prior Year) 2014 - 2015

U.S. ADR Outlook

2014 2015 4.2% 4.3%

RevPAR

RevPAR growth in 3 of the four regions

April 2014 YTD, RevPAR % Change in USD, Europe in Euro

- 2.8%

+ 6.1%

+ 5.3%

+ 4.4%€

Positive RevPAR Growth For The Foreseeable Future

-20

-15

-10

-5

0

5

10

1990 2000 2010

-16.8%

-2.6%

-10.1%

9% 8.6%

Total U.S., RevPAR % Change, 12 MMA 1/1990 – 4/2014

65 Months 44 Mo. 112 Months

April 2014 YTD RevPAR % Change in Top 25: 5 Best / 5 Worst Performing Markets

Market RevPAR % Change Nashville, TN 20.3 Denver, CO 20.1

San Francisco/San Mateo, CA 14.2 St. Louis, MO-IL 13.6

Dallas, TX 12.1

Norfolk/Virginia Beach, VA 2.5 New Orleans, LA 0.8

Chicago, IL 0.1 New York, NY 0.0

Washington, DC-MD-VA -4.3

2014 – 2015 Source: STR & TE

Outlook

2014 Forecast

2015 Forecast

Supply 1.2% 1.6%

Demand 2.6% 2.2%

Occupancy 1.4% 0.6%

ADR 4.2% 4.3%

RevPAR 5.7% 4.9%

U.S. Forecast Summary

Total U.S., Estimated Total Revenue and Profitability* 2008 – 2013

146.0

125.5 133.4

146.5 154.8

163.0

36.7 24.5 28.2

33.9 37.2 41.0

0

20

40

60

80

100

120

140

160

180

2008 2009 2010 2011 2012 2013

In B

illio

ns

Revenue Net Income

*Representing all U.S. hotels that collectively provide room revenue data to STR. Net Income defined as House Profit less management fees, property taxes, insurance, and an imputed 4.0% reserve for replacement expense.

New Peaks Reached in 2013

Key Takeaways • Industry is Profitable

• Supply Growth Accelerates

• First Quarter Demand Stronger than Expected • Group Demand: Finally Some Growth

• STR Forecast: Positive, Robust Growth

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