State of the Industry and Industry Forecast CWBTA Mark Williams November 8 , 2011

State of the Industry and Industry ForecastCWBTA

Mark WilliamsNovember 8, 2011

2Copyright Advito 2011

State-of-the-Industry Overview

Airline

Setting

Hotel

Ground Transportation

Meetings


Risk Factors

Economy

Oil price

Security/safety


Global Economic Outlook

The recovery is expected to slow down in 2012 in most regions, including China, and will decline in the eurozone

Source: IMF, World Economic Outlook, June 2011

2010: +5.1% ◄2011: +4.3% ◄2012: +4.5%

2010: +1.8%◄2011: +2.0%◄ 2012: +1.7%

Euro Area

2010: +2.9%◄2011: +2.5%◄2012: +2.7%

USA

World

2010: +10.3%◄2011: +9.6%2012: +9.5%

China

GDP◄ indicates revision to previous forecast


2012 Outlook

Global hotel rates increases are projected at 2-6%, based on higher demand and hotels’ push for higher rates

Demand is close to 2008 pre-recession levels and will continue to grow in 2012, barring negative economic developments

Overcapacity in some markets and a weakening in economic confidence will keep airfare increases to 3-5% increase globally

After two years of little change, rental car rates may rise 4-6%

Source: Advito 2012 Industry Forecast, Sept. 2011

Meeting rates will rise faster in 2012 and accelerate in 2013


Additional factors threatening to push up total ticket prices include consolidated airline entities, distribution/card payment fees and EU Emissions Trading System

Air Outlook 2012

Barring sharp economic decline or oil price surges, demand should continue to grow

Capacity cuts anticipated for Q4 2011 are likely to be sustained into 2012, but over-supply may remain in some regions

Fare increases of 3-5% will be less drastic than in 2011, when oil price prompted significant fuel surcharges



Airfare Predictions for 2012North America

Forecast of average development of air fares used by corporate clients 2012 against 2011 (in USD)

Business Economy

Intercontinental +5% +5%

Regional +3% +5%


Rising demand and supplier capacity discipline will result in YOY increases in airfares


Airfare Predictions for 2012Latin America

Forecast of average development of air fares used by corporate clients 2012 against 2011 (in $ USD)

Business Economy


Regional +5% +5%


Following similar trends and capacity/demand balance, Latin American air costs will also increase


Airfare Predictions for 2012Europe

Forecast of average development of air fares used by corporate clients 2012 against 2011 (in € EUR)

Business Economy


Regional +3% +5%


Sluggish home economies have led to softening regional demand but airfares are still expected to increase


Airfare Predictions for 2012Middle East

Forecast of average development of air fares used by corporate clients 2012 against 2011 (in € EUR)

Business Economy


Regional +3% +5%


Large capacity increases by Middle East carriers will temper ability to raise fares even with higher demand


Airfare Predictions for 2012Asia-Pacific

Forecast of average development of air fares used by corporate clients 2012 against 2011 (in $ USD)

Business Economy


Regional +4% +5%


Demand is increasing rapidly with the strength of the region’s economic rebound


0%

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Advance Booking Behavior

Same Day

> 0 and <=3 Days

> 3 and <= 7 Days

> 7 and <= 14 Days

> 14 and <=21 Days

> 21 Days

Advance Booking

Bookings made more than 14 days in advance remain at about 50% share of a fluctuating behavior pattern

Source: Advito 2012 Industry Forecast, August 2011

North America


Recommendations for Buyers – Air

Be wary of significant over-commitment to volume or market-share targets during negotiations

Negotiate hard on the pockets of over-capacity in the market

Joint ventures and other airline consolidations will pose an increasing challenge to managed air programs

A reliable way to reduce average ticket price is to find ways to avoid last-minute purchases



Spotlight: Oil Prices

Fears of economic slowdown have moderated skyrocketing oil pricesEvery US$10 rise in barrel price pushes up total ticket price by approximately 3% (higher fares and fuel surcharges)IMF forecasts US$105/barrel in 2012With a sharp rise in oil, Substantial increase in total ticket prices may prompt fall in corporate demand



Spotlight: Ancillary FeesThe Issues

Total price

VisibilityLeverage


Spotlight: Ancillary FeesThe Trends

Airlines collected $21.46bn in ancillary fee revenue in 2010 – an increase of 59% YOY and 775% over 2007

Expect airlines to continue experimenting with different forms of unbundling and merchandising

Our recommendations to clients Continue to create policy on unbundled services, including specifying which can be reimbursed and which cannot

Press suppliers to provide adequate reporting

Try to negotiate on rebundled packages as part of corporate agreements



Spotlight – Europe Card Payment Fees


In 2011, BA and Lufthansa Group announced fees for credit card paymentsWhat should clients be doing?– Prepare for other airlines to

follow suit/expand similar fee systems

– Make the fees a topic for negotiation in upcoming deals

– Evaluate payment options


Spotlight – EU Emissions Trading System

EU will include all airlines in ETS as of Jan. 1, 2012

ETS sets a cap on permissible emissions; beyond that cap, companies must buy permits

Non-European airlines are fighting hard against being included in the ETS


How much the ETS will cost airlines?How much of that cost they will pass on to passengers?How they will pass it on?


Demand will continue to rise, though at a lower rate than 2011

Rates will rise 2- 6% percent in general, but with another double-digit jump in markets like New York

New capacity will be limited in N. America and Europe but significant in Asia-Pacific

More chains will demand heavy rate increases in opening 2012 negotiations

Hotel Outlook 2012



Hotel ADR: 2012 Forecast by Region

Forecast of average development of hotel rates used by corporate clients in 2012 against 2011 (local currency)

North America +5-6%

Europe+2-3%

Asia-Pacific+6-7%

Middle East +6-7%

Africa+3-4%

Steadily increasing demand will usher in moderate ADR increases

Latin America +5-6%



Hotel ADR: 2012 Forecast by Market

Forecast of average development of hotel rates used by corporate clients in 2012 against 2011 (local currency)

US +5-6%

RU +3-5%

CN +4-6% KO +3-5%

SG +2-4%

AE +2-4%IN +4-6%MX +1-3%

BR +4-6%

CH-PT-SE +0-2%ES-IE-IT +1-3% NL-TR-UK +1-3% AT-BE-CZ +2-4%FR-DE +2-4%


AR +5-7%AU +2-4%

CA +4-6%

JP +0-2%

DK-FI-NO +2-4%

ZA +2-4%

SA +2-4%

Moderate increases are expected due to continuing though moderated economic growth tempered by new supply


Spotlight – London Olympics (July 27- Aug.12, 2012)

Take action nowBlock space in advanceLook at extended-stay properties as an alternativeConsider locations outside London, up to an hour away by train, such as Reading, Oxford or CambridgeBe aware of the impact that the Olympics will also have on air supply to and from LondonReview the situation at the start of 2012

Hotels may ask 5-10x their normal rate

Demand will skyrocket


Recommendations for Buyers – Hotel

Insist on negotiated rate being an LRA rate

Source: Advito 2012 ndustry Forecast, Sept. 2011

Expand number of hotels in RFP process but concentrate on fewer properties in final decision, except in large, high demand markets

Be wary of dynamic pricing, and be sure to negotiate more than 10 percent off the BAR with dynamic pricing

Consider imposing city caps based on total cost of stay

Negotiate hotel contracts for transient travelers to cover small meetings (up to 50 room nights)


2012 Outlook – Meetings

Demand will continue to grow worldwide, approaching peak 2008 levels by year-end 2012

Rates are expected to return to 2008 levels in 2013/2014

Rates for meetings will rise faster in 2012 than in 2011 and accelerate even more sharply in 2013

Lead-times may start to lengthen as supply at preferred hotels dwindles



Recommendations for Buyers – Meetings

Watch out for suppliers being less flexible in negotiating terms and conditions

With the negotiating environment likely to be even tougher in 12 months’ time, consider the option of multi-year deals with suppliers

Book ahead, especially in high-demand cities

Do not expect to find upscale hotel bargains any more


Be more prepared to consider second- and third-tier cities.


2012 Outlook – Car Rental

Rate increases will be minor (4-6%) thanks to strong competition, but total cost of rental will continue to climb (ancillary charges, taxes, insurance, fuel)

Demand will continue to rise steadily, and providers will keep inventory tightly aligned



Spotlight – Car Sharing

Corporate interest is likely to grow in 2012Good for less-than-a-day rentalsAdministrative processing provides good management informationEnvironmentally friendly aspect–better vehicle utilization and introduction of electric cars


Companies which need car rentals in major cities should

evaluate the market

Analyze your existing rental program in more detail


Recommendations for Buyers – Car Rental

Negotiate harder on ancillaries and other charges, such as refueling premiums


Revisit car rental program before suppliers start to push up their rates

Book further in advance

Evaluate relative financial costs of private vehicle use vs. car rental

Set a policy on ancillary items (e.g., satellite navigation systems)


2012 Outlook – Rail


Expect price increases of 4-5%, on a par with 2011

Demand and price are provisionally forecast to be flat in 2012, although that could change with the introduction of several planned new domestic LCCs

Distribution of international rail will remain challenging

French national operator SNCF could lose market share as they begin major network renovations

Europe

Japan


Thank You!


Cost per Mile: Asia Pacific


Asia Pacific - USD Jun-10 Jul-10 Aug-10 Sep-10 Oct-10 Nov-10 Dec-10 Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11Intercontinental Business CPM 35.4 39.0 40.1 39.9 38.2 42.5 40.1 41.2 39.5 40.3 38.3 44.5 43.3Intercontinental Economy CPM 13.8 13.6 14.6 13.0 13.2 13.5 16.4 14.9 15.2 14.2 15.2 15.4 17.4

Regional Business CPM 50.6 49.2 48.0 47.0 43.5 46.5 48.7 41.9 46.4 46.6 48.6 49.9 52.9Regional Economy CPM 23.2 25.3 25.6 26.6 27.5 29.7 30.1 28.0 29.1 30.8 35.8 32.2 32.9

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May-10 Jun-10 Jul-10 Aug-10 Sep-10 Oct-10 Nov-10 Dec-10 Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11

Cost per Mile (y-o-y)

Inter-continental Business Inter-continental Economy Regional Business Regional Economy


Cost per Mile: Europe


EUROPE - EUR Jun-10 Jul-10 Aug-10 Sep-10 Oct-10 Nov-10 Dec-10 Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11Intercontinental Business CPM 36.1 35.7 37.3 34.5 34.1 33.9 33.6 31.4 33.0 34.7 34.3 33.3 35.5Intercontinental Economy CPM 14.9 14.8 11.6 11.8 12.5 11.5 11.9 11.2 11.4 10.9 13.4 11.8 15.0


-30%

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0%

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Cost per Mile: Middle East


Middle East - EUR Jun-10 Jul-10 Aug-10 Sep-10 Oct-10 Nov-10 Dec-10 Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11Intercontinental Business CPM 30.2 30.1 33.0 33.9 25.3 22.4 25.7 32.6 31.9 30.8 27.4 29.3 32.5Intercontinental Economy CPM 12.9 10.6 9.2 11.6 10.2 8.4 10.0 11.0 10.5 12.0 8.3 9.1 11.0


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Cost per Mile: Latin America


Latin America - USD Jun-10 Jul-10 Aug-10 Sep-10 Oct-10 Nov-10 Dec-10 Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11Intercontinental Business CPM 40.7 33.2 35.4 36.2 34.7 38.4 35.0 33.5 34.6 35.3 42.6 38.9 36.8Intercontinental Economy CPM 14.8 15.3 15.4 14.4 14.0 16.0 18.0 15.4 14.3 16.5 16.8 16.9 15.5


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120%





Cost per Mile: North America


North America - USD Jun-10 Jul-10 Aug-10 Sep-10 Oct-10 Nov-10 Dec-10 Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11Intercontinental Business CPM 53.9 52.3 56.6 56.6 55.9 56.7 53.6 55.2 55.9 56.8 57.9 57.9 56.2Intercontinental Economy CPM 21.0 19.8 20.1 18.5 16.7 17.1 18.3 18.1 17.4 18.4 18.8 20.1 21.2


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Economy Class Ratio

North America Europe

The use of economy class has increased on regional flights in North America and Europe


48% 50% 54%

92% 93% 94%

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100%

2009 2010 2011YTD

Econ

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as

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Economy Class RatioInter-continental Regional

51% 54% 51%

87% 87% 89%

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100%

2009 2010 2011YTD

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Economy Class RatioInter-continental Regional


Hotel Rate Developments: United Kingdom


United Kingdom JUN 10 JUL 10 AUG 10 SEP 10 OCT 10 NOV 10 DEC 10 JAN 11 FEB 11 MAR 11 APR 11 MAY 11 JUN 11Local ADR (GBP) £154 £154 £131 £153 £147 £146 £149 £140 £137 £141 £147 £152 £165

13%

10%11%

3%

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5%6% 6%

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0%

9%

3%

7%

0

20

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0

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Y-o-

Y)Country ADR Last 12 Months


Hotel Rate Developments: United Arab Emirates


UAE JUN 10 JUL 10 AUG 10 SEP 10 OCT 10 NOV 10 DEC 10 JAN 11 FEB 11 MAR 11 APR 11 MAY 11 JUN 11Local ADR (AED) AED 666 AED 589 AED 603 AED 723 AED 914 AED 944 AED 927 AED 921 AED 977 AED 901 AED 809 AED 693 AED 593

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Hotel Rate Developments: Singapore


Singapore JUN 10 JUL 10 AUG 10 SEP 10 OCT 10 NOV 10 DEC 10 JAN 11 FEB 11 MAR 11 APR 11 MAY 11 JUN 11Local ADR (SGD) SGD 317 SGD 283 SGD 297 SGD 321 SGD 294 SGD 298 SGD 296 SGD 312 SGD 304 SGD 307 SGD 305 SGD 310 SGD 309

9%

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50

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0

Aug

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Hotel Rate Developments: Russia


Russia JUN 10 JUL 10 AUG 10 SEP 10 OCT 10 NOV 10 DEC 10 JAN 11 FEB 11 MAR 11 APR 11 MAY 11 JUN 11Local ADR (RUR) 9,691р. 8,321р. 7,619р. 9,534р. 8,950р. 9,002р. 8,878р. 8,271р. 8,814р. 8,345р. 8,737р. 8,744р. 8,950р.

-7%

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Hotel Rate Developments: Mexico


Mexico JUN 10 JUL 10 AUG 10 SEP 10 OCT 10 NOV 10 DEC 10 JAN 11 FEB 11 MAR 11 APR 11 MAY 11 JUN 11Local ADR (MXN) $1,236 $1,245 $1,212 $1,253 $1,207 $1,223 $1,260 $1,204 $1,234 $1,182 $1,165 $1,150 $1,166

1%

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0

200

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Aug

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Hotel Rate Developments: United States


United States JUN 10 JUL 10 AUG 10 SEP 10 OCT 10 NOV 10 DEC 10 JAN 11 FEB 11 MAR 11 APR 11 MAY 11 JUN 11Local ADR (USD) $134 $130 $128 $136 $136 $134 $132 $129 $131 $135 $134 $137 $139

-1%

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Hotel Rate Developments: Korea


Republic of Korea JUN 10 JUL 10 AUG 10 SEP 10 OCT 10 NOV 10 DEC 10 JAN 11 FEB 11 MAR 11 APR 11 MAY 11 JUN 11Local ADR (KRW) KRW 244,391 KRW 228,410 KRW 229,232 KRW 230,641 KRW 256,904 KRW 255,287 KRW 220,635 KRW 223,201 KRW 230,986 KRW 237,131 KRW 231,705 KRW 240,298 KRW 229,216

3%

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Hotel Rate Developments: Japan


Japan JUN 10 JUL 10 AUG 10 SEP 10 OCT 10 NOV 10 DEC 10 JAN 11 FEB 11 MAR 11 APR 11 MAY 11 JUN 11Local ADR (JPY) JPY 20,329 JPY 19,454 JPY 18,289 JPY 19,529 JPY 19,209 JPY 19,371 JPY 19,354 JPY 18,608 JPY 20,025 JPY 17,070 JPY 20,461 JPY 19,620 JPY 19,016

-3%-3%

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Aug

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Sep

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Hotel Rate Developments: Italy


Italy JUN 10 JUL 10 AUG 10 SEP 10 OCT 10 NOV 10 DEC 10 JAN 11 FEB 11 MAR 11 APR 11 MAY 11 JUN 11Local ADR (EUR) € 167 € 156 € 142 € 178 € 166 € 135 € 132 € 144 € 141 € 143 € 156 € 157 € 163


Hotel Rate Developments: Ireland


Ireland JUN 10 JUL 10 AUG 10 SEP 10 OCT 10 NOV 10 DEC 10 JAN 11 FEB 11 MAR 11 APR 11 MAY 11 JUN 11Local ADR (EUR) EUR 122 EUR 119 EUR 116 EUR 113 EUR 111 EUR 106 EUR 105 EUR 105 EUR 110 EUR 110 EUR 109 EUR 113 EUR 117

2%

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-8%

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Aug

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Hotel Rate Developments: India


India JUN 10 JUL 10 AUG 10 SEP 10 OCT 10 NOV 10 DEC 10 JAN 11 FEB 11 MAR 11 APR 11 MAY 11 JUN 11Local ADR (INR) INR 7,854 INR 7,700 INR 7,648 INR 8,574 INR 8,617 INR 9,099 INR 9,479 INR 9,407 INR 9,607 INR 8,967 INR 8,308 INR 7,937 INR 7,772

-8%

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8%

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0

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Aug

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Oct

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Hotel Rate Developments: Germany


Germany JUN 10 JUL 10 AUG 10 SEP 10 OCT 10 NOV 10 DEC 10 JAN 11 FEB 11 MAR 11 APR 11 MAY 11 JUN 11Local ADR (EUR) € 116 € 110 € 104 € 135 € 125 € 116 € 112 € 119 € 118 € 119 € 116 € 123 € 116

-7%

1%

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11

Feb-

11

Mar

-11

Apr

-11

May

-11

Jun-

11

Mon

thly

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Hotel Rate Developments: France


France JUN 10 JUL 10 AUG 10 SEP 10 OCT 10 NOV 10 DEC 10 JAN 11 FEB 11 MAR 11 APR 11 MAY 11 JUN 11Local ADR (EUR) € 189 € 170 € 156 € 188 € 180 € 158 € 164 € 159 € 156 € 161 € 161 € 180 € 202

7%

2% 2%

8%

13%

11%

0%

7%

4%

2%1%

3%

5%

7%

0

50

100

150

200

250

-2%

0%

2%

4%

6%

8%

10%

12%

14%

May

-10

Jun-

10

Jul-1

0

Aug

-10

Sep

-10

Oct

-10

Nov

-10

Dec

-10

Jan-

11

Feb-

11

Mar

-11

Apr

-11

May

-11

Jun-

11

Mon

thly

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Hotel Rate Developments: China


China JUN 10 JUL 10 AUG 10 SEP 10 OCT 10 NOV 10 DEC 10 JAN 11 FEB 11 MAR 11 APR 11 MAY 11 JUN 11Local ADR (CNY) CNY 1,019 CNY 1,010 CNY 953 CNY 1,072 CNY 1,166 CNY 1,035 CNY 1,038 CNY 1,056 CNY 981 CNY 1,018 CNY 1,104 CNY 1,045 CNY 1,042

1%

4%

6%

-1%

6%

16%

5%

7%8%

3%2%

4%

1%2%

0

200

400

600

800

1,000

1,200

1,400

-2%

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

May

-10

Jun-

10

Jul-1

0

Aug

-10

Sep

-10

Oct

-10

Nov

-10

Dec

-10

Jan-

11

Feb-

11

Mar

-11

Apr

-11

May

-11

Jun-

11

Mon

thly

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Hotel Rate Developments: Canada


Canada JUN 10 JUL 10 AUG 10 SEP 10 OCT 10 NOV 10 DEC 10 JAN 11 FEB 11 MAR 11 APR 11 MAY 11 JUN 11Local ADR (CAD) $165 $158 $157 $160 $157 $150 $146 $144 $146 $147 $146 $154 $159

9%

5%4%

3%4%

5%

4%

2%

-1% -1%

2%

-2% -2%

-4%

0

20

40

60

80

100

120

140

160

180

-6%

-4%

-2%

0%

2%

4%

6%

8%

10%

12%

May

-10

Jun-

10

Jul-1

0

Aug

-10

Sep

-10

Oct

-10

Nov

-10

Dec

-10

Jan-

11

Feb-

11

Mar

-11

Apr

-11

May

-11

Jun-

11

Mon

thly

AD

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Hotel Rate Developments: Brazil


Brazil JUN 10 JUL 10 AUG 10 SEP 10 OCT 10 NOV 10 DEC 10 JAN 11 FEB 11 MAR 11 APR 11 MAY 11 JUN 11Local ADR (BRL) BRL 229 BRL 220 BRL 223 BRL 229 BRL 223 BRL 229 BRL 210 BRL 230 BRL 242 BRL 246 BRL 251 BRL 248 BRL 246

20%

6%

9%9%

16%

7%

11%

3% 3%

5%

8%

13%

5%

7%

0

50

100

150

200

250

300

0%

5%

10%

15%

20%

25%

May

-10

Jun-

10

Jul-1

0

Aug

-10

Sep

-10

Oct

-10

Nov

-10

Dec

-10

Jan-

11

Feb-

11

Mar

-11

Apr

-11

May

-11

Jun-

11

Mon

thly

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Hotel Rate Developments: Top U.S. Cities

Highest 2011 ADR increases seen in San Francisco and Dallas


Top 2010 2011 U.S. Cities 1Q 2Q 3Q 4Q 1Q 2QATL ADR 132 129 131 137 135 133

Y-o-Y -8.1% -5.8% -1.7% 4.9% 2.6% 3.0%BOS ADR 176 228 235 218 183 240

Y-o-Y -6.9% 1.0% 6.6% 2.2% 3.9% 5.3%CLT ADR 124 125 121 128 131 130

Y-o-Y -6.8% -5.7% -1.3% 1.9% 5.0% 3.8%CHI ADR 147 193 195 200 153 206

Y-o-Y -11.8% -0.1% 5.3% 5.5% 4.1% 6.9%DFW ADR 125 124 125 129 138 132

Y-o-Y -8.2% -4.2% -0.6% 3.8% 10.4% 6.5%DEN ADR 139 140 140 139 141 146

Y-o-Y -4.3% -0.7% -0.3% -0.6% 1.4% 3.9%HOU ADR 135 136 130 131 134 141

Y-o-Y -10.2% -7.5% -5.3% -3.9% -0.8% 3.9%IND ADR 109 113 110 107 109 112

Y-o-Y -6.2% -0.2% -3.2% -4.4% -0.3% -0.8%LAS ADR 134 128 120 129 141 133

Y-o-Y -3.6% 2.2% 6.2% 3.4% 5.0% 3.3%LAX ADR 155 162 162 161 168 169

Y-o-Y -5.2% 0.4% 2.5% 2.1% 8.5% 4.3%

Top 2010 2011 U.S. Cities 1Q 2Q 3Q 4Q 1Q 2QNYC ADR 245 303 304 350 260 329

Y-o-Y -5.3% 12.6% 7.2% 4.2% 6.0% 8.8%ORL ADR 121 119 104 116 130 123

Y-o-Y -8.1% -4.7% -1.2% -0.7% 6.9% 3.3%PHL ADR 157 164 160 163 164 177

Y-o-Y -7.7% -1.1% 2.9% -1.7% 4.6% 8.0%PHX ADR 159 122 104 130 153 120

Y-o-Y -10.3% -0.4% -0.6% -3.5% -3.7% -1.9%PDX ADR 118 121 127 123 117 134

Y-o-Y -12.0% -7.3% -4.0% -2.5% -0.4% 5.9%STL ADR 113 118 118 118 119 125

Y-o-Y -4.3% -0.6% 1.1% 4.0% 2.6% 3.9%SAN ADR 140 144 152 139 143 144

Y-o-Y -9.8% -4.6% 1.0% -1.2% 2.3% -0.1%SFO ADR 187 186 203 205 207 213

Y-o-Y -8.5% -1.7% 3.9% 2.9% 11.1% 14.8%SEA ADR 148 160 170 151 152 163

Y-o-Y -7.0% -4.9% 0.7% 0.7% 3.0% 2.2%WAS ADR 229 260 230 239 234 259

Y-o-Y -3.4% 5.0% 7.0% 0.6% 2.1% -0.4%


Hotel Rate Developments: Top European Cities

London continues to be the best performing market in Europe


Top Euro Cities 2010 2011ADR Local Currency 1Q 2Q 3Q 4Q 1Q 2QAmsterdam ADR 141 160 158 150 146 159

Y-o-Y -4.7% 7.8% 8.1% 5.5% 3.4% -0.3%Barcelona ADR 116 130 129 120 121 147

Y-o-Y -8.4% 2.3% 1.1% 4.1% 4.7% 13.1%Berlin ADR 121 120 127 116 122 118

Y-o-Y -3.1% -0.8% 4.1% -1.9% 0.7% -1.8%Brussels ADR 141 155 139 157 156 163

Y-o-Y -8.0% 3.7% 4.4% 5.9% 10.6% 4.7%Copenhagen ADR 1031 1111 1184 1120 1132 1208

Y-o-Y -4.3% -1.9% 9.1% -10.8% 9.8% 8.8%Dublin ADR 114 119 116 109 111 117

Y-o-Y -13.8% -5.0% -6.2% -8.1% -3.1% -1.2%Duesseldorf ADR 114 116 116 129 122 137

Y-o-Y -4.8% -0.1% 0.1% 0.9% 7.1% 18.6%Frankfurt ADR 145 146 140 139 152 141

Y-o-Y -7.9% 2.2% 1.7% -1.2% 4.3% -3.4%London ADR 156 166 168 171 160 180

Y-o-Y 2.1% 11.3% 9.5% 8.2% 2.5% 8.6%Hamburg ADR 114 117 123 115 114 123

Y-o-Y -6.5% 0.0% 2.7% -3.8% -0.2% 5.0%

Top Euro Cities 2010 2011ADR Local Currency 1Q 2Q 3Q 4Q 1Q 2QMadrid ADR 117 130 115 120 118 130

Y-o-Y -11.0% 5.9% 4.1% -1.4% 0.4% 0.1%Milan ADR 170 171 170 162 171 176

Y-o-Y -6.5% 0.0% 12.2% 4.9% 0.5% 2.8%Moscow ADR 9180 9391 9275 9831 9548 9556

Y-o-Y -14.0% -3.6% 1.0% 1.3% 4.0% 1.8%Munich ADR 124 139 152 142 136 140

Y-o-Y -10.0% 4.1% 7.3% 4.5% 9.9% 1.0%Paris ADR 180 198 199 196 184 215

Y-o-Y -4.8% 3.5% 9.8% 7.3% 2.4% 8.5%Prague ADR 2849 3130 3108 2958 2712 3172

Y-o-Y -11.1% -6.4% 0.8% 0.0% -4.8% 1.3%Rome ADR 147 191 184 167 157 190

Y-o-Y -9.9% 4.1% -1.0% 6.5% 6.3% -0.6%Stockholm ADR 1629 1740 1767 1695 1616 1723

Y-o-Y -3.2% 3.5% 8.0% 1.0% -0.8% -1.0%Vienna ADR 131 141 145 137 131 143

Y-o-Y 2.6% 7.6% 6.1% 2.3% -0.1% 1.0%Zurich ADR 279 288 280 259 260 277

Y-o-Y -7.9% 1.9% 5.6% -5.9% -7.0% -4.0%


Hotel Rate Developments: Top Cities in Asia-Pacific

Hotel rates in APAC are recovering faster than other regions with Hong Kong and Singapore leading the way


Top APAC Cities 2010 2011ADR Local Currency 1Q 2Q 3Q 4Q 1Q 2Q

Bangkok ADR 4784 4604 4393 4585 4881 4900Y-o-Y -9.4% -0.1% -5.0% -6.8% 2.0% 6.4%

Beijing ADR 1004 1060 1012 1079 1074 1142Y-o-Y -9.4% -7.0% -2.3% 4.1% 7.0% 7.7%

Dubai ADR 961 702 614 874 915 709Y-o-Y -10.6% -10.4% -3.3% -9.7% -4.8% 0.9%

Hong Kong ADR 1911 1896 1911 2210 2350 2112Y-o-Y 0.4% 13.2% 13.4% 20.2% 23.0% 11.4%

Mumbai ADR 9582 9044 8921 10337 10252 9121Y-o-Y -17.7% -6.6% -1.7% 12.0% 7.0% 0.9%

Seoul ADR 230912 236423 240690 253612 242163 245719Y-o-Y -0.6% 9.4% 10.1% 9.9% 4.9% 3.9%

Shanghai ADR 1136 1281 1250 1289 1195 1228Y-o-Y -7.7% 7.6% 9.2% 13.3% 5.2% -4.2%

Singapore ADR 288 304 301 296 307 308Y-o-Y -1.5% 12.6% 9.8% 8.8% 6.6% 1.2%

Sydney ADR 259 242 237 260 249 238Y-o-Y 2.8% 7.6% 2.3% 3.8% -3.8% -1.6%

Tokyo ADR 22243 22100 20760 20958 21050 21643Y-o-Y -8.3% -3.0% -7.5% -9.3% -5.4% -2.1%


Hotel Rate Developments: Top cities in Canada & Latin America

Inflation is affecting Buenos Aires with the highest ADR increases. Brazil’s economic boom is also affecting their hotel rates

Canada & Lat.Am 2010 2011ADR Local Currency 1Q 2Q 3Q 4Q 1Q 2Q

Bs. Aires ADR 526 548 574 674 667 674Y-o-Y -14.8% -7.4% 4.4% 13.4% 26.8% 23.0%

Lima ADR 498 460 478 512 530 561Y-o-Y -19.7% -9.9% -2.9% -0.8% 6.5% 21.9%

Mexico City ADR 1805 1723 1706 1673 1709 1595Y-o-Y -17.4% -9.1% -12.3% -9.4% -5.3% -7.4%

Montreal ADR 143 164 167 153 148 163Y-o-Y -4.4% 11.0% 6.0% 1.6% 3.1% -0.6%

Rio ADR 328 324 314 330 355 360Y-o-Y -9.7% 8.8% 9.8% 12.0% 8.3% 11.3%

San Jose ADR 76435 72840 74371 73623 75448 77334Y-o-Y 0.6% -3.0% 7.7% 1.5% -1.3% 6.2%

Santiago ADR 100117 93344 81930 93463 84601 88655Y-o-Y -10.0% 0.6% -6.8% 14.5% -15.5% -5.0%

Sao Paulo ADR 283 276 265 264 302 325Y-o-Y 3.1% 7.1% 10.9% 6.9% 6.9% 17.7%

Toronto ADR 150 164 160 160 153 161Y-o-Y -8.0% 5.8% 3.0% 5.0% 2.0% -1.9%

Vancouver ADR 181 170 180 163 153 177Y-o-Y 15.9% 6.4% 2.6% 7.2% -15.2% 4.0%



Tier Distribution

The upscale market has been slowly reclaiming its market share while the Upper Upscale segment retains the largest corporate market


United States

4.0%

4.0%

4.0%

47.9%

48.4%

47.5%

13.2%

12.5%

11.4%

32.1%

32.3%

33.9%

1.6%

1.6%

1.7%

0% 20% 40% 60% 80% 100%

2011 YTD

2010

2009

% of Room Nights

Tier Distribution

Luxury Upper Upscale Upscale Mid Scale Economy Mixed


Hotel Supply Growth

Source: Lodging Econometrics, Construction Pipeline August 2011

For 2012, most new hotels in the US are planned for NY, while in Europe, UK is getting a third of new construction (Olympics)

United States

Documents

State of the Industry and Industry Forecast CWBTA Mark Williams November 8 , 2011