Hotel Performance Outlook North Dakota Travel Industry Conference Kelsey Waite Business Development Executive, Destinations kwaite@str.com @Kelsey_STR 2017 STR, Inc. All Rights Reserved. Any reprint, use or republication of all or a part of this presentation without the prior written approval of STR, Inc. or STR Global, Ltd. trading as STR (collectively STR ) is strictly prohibited. Any such reproduction shall specifically credit STR as the source. This presentation is based on data collected by STR. No strategic advice or marketing recommendation is intended or implied.
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Total US Performance Canada Performance North Dakota State Trends North Dakota Markets Competitive Market Comparisons Look to the Future
Key Terms Supply: Number of Rooms Available Demand: Number of Rooms Sold Revenue: Rooms Revenue before Taxes
Key Terms Occupancy: Demand/Supply ADR (Average Daily Rate): Revenue/Demand RevPAR (Revenue Per Available Room): Revenue/Supply
Total US Performance
Total US - Key Statistics Year End 2016 % Change Hotels 53 k Room Supply 1.8 bil 1.4% Room Demand 1.2 bil 1.7% Occupancy 65.5% 0.1% ADR $124 3.1% RevPAR $81.17 3.2% Room Revenue $149 tril 4.8%
Total United States Room Supply in Billions Twelve Month Moving Average 1989 to February 2017 1.9 1.8 Jan 10 1.75 Bil 1.7 1.6 1.5 Jul 06 1.62 Bil 1.4 1.3 Jul 93 1.27 Bil 1.2 1.1
Total United States Room Demand in Billions Twelve Month Moving Average 1989 to February 2017 1.3 1.2 1.1 1.0 0.9 0.8 Jan 91 774 Mil March 01 972 Mil Jan 10 942 Mil 0.7 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017
Total United States Occupancy and ADR Twelve Month Moving Average February 2017 130 120 110 100 90 80 70 60 50 Prior Peak: 64.5% Feb 97 Occupancy (%) ADR ($) Prior Peak: $107.72 Sept 08 $124.40 Feb'17 65.4% Feb'17 40 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017
Total United States RevPAR Twelve Month Moving Average 1989 to February 2017 $90 $80 Feb 17 $81.40 $70 $60 $50 $40 Mar 01 $53.93 Jul 08 $66.02 Mar 10 $53.26 $30 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017
Total United States Key Performance Indicators Percent Change February YTD 2017 5 4 3 2 1 1.4 1.9 1.8 0.6 3.9 4.3 3.3 2016 2017 2.4 2.4 2.4 0-1 -0.8-0.1-2 Supply Demand Revenue Occupancy ADR RevPAR
Total US - Key Statistics YTD February 2017 % Change Hotels 53 k Room Supply 297.6 mil 1.9% Room Demand 170.9 mil 1.8% Occupancy 57.4% -0.1% ADR $122.02 2.4% RevPAR $70.08 2.4% Room Revenue $208 bn 4.3%
Total Canada Performance
Total Canada - Key Statistics Year End 2016 in USD $106.83 $111.47 2015 2016 64.1% 64.5% $68.53 $71.92 Occupancy ADR RevPAR
Total Canada - Key Statistics Percent Change Year End 2016 5.9% 5% 4.3% 0.9% 1.5% 0.6% Supply Demand Revenue Occupancy ADR RevPAR
Total Canada Key Statistics Year to Date February 2017 in USD $104.14 53.6% $55.87 Occupancy ADR RevPAR
North Dakota Performance
Total North Dakota - Key Statistics Year End 2016 % Change Hotels 318 Room Supply 8.97 mil 3.7% Room Demand 4.5 mil -5.6% Occupancy 50.3% -9.1% ADR $83.23-11.2% RevPAR $41.83-19.2% Room Revenue $375.1 mil -16.1% Previous Peak in Hotels was Aug 2016: 24,718
Total North Dakota Year End 2016 vs. 2015 $93.69 $83.23 2015 2016 55.2% 50.3% $51.75 $41.83 Occupancy ADR RevPAR
Total North Dakota Supply in Millions 12 Month Moving Average February 2017 10.0 9 Million 9.0 8.0 7.0 6.0 5.9 Million 5.0 4.0 3.9 Million 3.0 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017
Total North Dakota Demand in Millions 12 Month Moving Average February 2017 6.0 5.5 Feb 15 5.5 M 5.0 4.5 4.0 Oct 12 4.7 M May 13 4.6 M July 16 4.4 M 3.5 3.0 2.5 2.0 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017
Total North Dakota Supply/Demand Percent Change 12 Month Moving Average February 2017 20 15 10 Supply Demand Sept 13 15.5% Jan 15 11.6% 5 0-5 June 13-0.3% -10-15 April 16-17.4% -20 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017
Total North Dakota Occupancy and ADR 12 Month Moving Average February 2017 110 100 Occupancy ADR Nov 12 $102.35 90 80 70 May 11 $82.12 Feb 17 $82.55 60 50 Jan 15 66.8% 40 30 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017
Total North Dakota RevPAR 12 Month Moving Average February 2017 80 70 Aug 12 $76.84 Jan 15 $65.74 60 50 April 08 $41.67 40 Jan 17 $41.94 30 20 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017
Total North Dakota - Key Statistics YTD February 2017 % Change Hotels 318 Room Supply 1.4 mil 0.9% Room Demand 621,420 11.5% Occupancy 42.9% 10.6% ADR $82.25-6.3% RevPAR $35.25 3.7% Room Revenue $51.1 mil 4.5% Previous Peak in Hotels was Aug 2016: 24,718
North Dakota Submarkets
North Dakota Submarkets Census Data February 2017 North Dakota Area Hotels: 222 Rooms: 15,902 Bismarck Hotels: 39 Rooms: 3,510 Fargo/Moorhead Hotels: 63 Rooms: 5,586
North Dakota Submarkets Occupancy Year End 2015 vs. 2016 2015 2016 63.9% 64.9% 61.5% 55.2% 57.5% 50.3% 51.0% 44.4% Total ND ND Area Bismarck Fargo
North Dakota Submarkets Average Daily Rate Year End 2015 vs. 2016 $93.69 $96.09 $93.45 $83.23 $79.78 $89.34 $86.96 $85.99 Total ND ND Area Bismarck Fargo 2015 2016
North Dakota Submarkets RevPAR Year End 2015 vs. 2016 2015 2016 $59.72 $58.02 $51.75 $48.98 $53.48 $49.47 $41.83 $35.45 Total ND ND Area Bismarck Fargo
North Dakota Submarkets Revenue in Millions Year End 2015 vs. 2016 $447 $375 2015 2016 $276 $207 $75 $74 $105 $102 Total ND ND Area Bismarck Fargo
Comparison to Competitors
Occupancy Year End 2016 63.0% 64.1% 57.2% 58.5% 59.1% 53.6% 50.3% North Dakota South Dakota Texas Montana West North Central Manitoba Saskatchewan
Occupancy Percent Change Year End 2016 2.2 1-0.6-0.8-2.7-9.1 North Dakota South Dakota Texas Montana West North Central Manitoba -8.1 Saskatchewan
Average Daily Rate Year End 2016 in USD $100.28 $101.52 $95.91 $92.04 $93.63 $89.49 $83.23 North Dakota South Dakota Texas Montana West North Central Manitoba Saskatchewan
Average Daily Rate Percent Change Year End 2016 1.4 2.7 2.8 0.2-0.1-4.9-11.2 North Dakota South Dakota Texas Montana West North Central Manitoba Saskatchewan
RevPAR Year End 2016 in USD $63.21 $59.35 $56.68 $57.36 $52.69 $50.15 $41.83 North Dakota South Dakota Texas Montana West North Central Manitoba Saskatchewan
RevPAR Percent Change Year End 2016 2.5 2.1 2 2.4-2.8-12.6-19.2 North Dakota South Dakota Texas Montana West North Central Manitoba Saskatchewan
Look to the Future
North Dakota Hotel Development Pipeline Construction Phase Properties Rooms In Construction 3 293 Final Planning 3 336 Planning 4 334 Totals 10 963 Pipeline by Phase, February 2017 North Dakota
Under Construction Projects 96 Rooms Hawthorn Suites by Wyndham (Fargo) Comfort Suites (Williston) 90 Rooms 107 Rooms Homewood Suites (West Fargo Sanford Medical Center)
Price of Oil Marks ND Room Demand Growth YOY % Change Demand in North Dakota Feb 2017 $100 $90 $80 $70 $60 $50 $40 $30 Crude Oil Futures Price / Barrel Room Demand % Change 2014 2015 2016 2017 20.0 15.0 10.0 5.0 0.0-5.0-10.0-15.0-20.0-25.0-30.0 *Monthly Oil price Future / Barrel vs. North Dakota Room Demand % Change 1/2014 12/2016 http://www.investing.com/commodities/crude-oil
2017 Year End RevPAR Forecast Top 25 US Markets
Total US Forecast Key Performance Indicator Outlook (% Change vs. Prior Year) 2017F 2018F
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Thank You! Kelsey Waite kwaite@str.com (615) 824-8664 ext. 3458 2017 STR, Inc. All Rights Reserved. Any reprint, use or republication of all or a part of this presentation without the prior written approval of STR, Inc. or STR Global, Ltd. trading as STR (collectively STR ) is strictly prohibited. Any such reproduction shall specifically credit STR as the source. This presentation is based on data collected by STR. No strategic advice or marketing recommendation is intended or implied.