State of Atlanta: Hotels Peggy Berg, ISHC The Highland Group

Times are very good & getting better…  A lot better

Sources US and CITYWIDE Statistics from Smith Travel Research Sector information from The Highland Group

Atlanta fell harder & longer, but we’re gaining now!

Atlanta RevPar Fell Deeper than US; Then UP 8% in 2004

Atlanta RevPar Trailing But Gaining Momentum UP 8% YTD

Atlanta Occupancy Up 2.7 Points in 2004

Atlanta Occupancy Up 2.6 Points Already 2005 YTD

Atlanta Rates UP $2.39 in 2004 (1 st Gain in 3 Years)

Atlanta Rate YTD Already UP $2.81 by July 2005

Atlanta by Sector Downtown: Hit hardest Recovery accelerating New hotels coming on line (boutique and luxury product) Becoming a “world class” destination? Gaining from Katrina

Atlanta by Sector Buckhead New Intercontinental; planned St. Regis Condo structure Rates accelerating Space tight for groups already

Airport Slammed by 9-11 (still) Low end contracts still in high end hotels (but getting pushed out finally) Picking up Katrina contracts Shifting with completion of I-285 and 5 th runway Public development restrictions

Southside I-85 south lots of limited service inventory I-75 south lots of limited service inventory Job growth and I-75 travel boosting demand Better lodging product coming on line

Northeast Too many of the wrong rooms New “core” at Sugarloaf performing well Division into the “Haves vs Have Nots” Market picking up overall

Northwest Upside with Cumberland improvements Convention business should improve Compression from downtown should improve Need for real renovation or demolition

Industry Trends Condos and “Hybrid” lodging products on the high end New brands in the mid market – Indigo, Hyatt Place, Starwood XYZ Upgrades and replacement in the strong brands (Marriott, Holiday Inn, Hilton) Cheaper new construction prototypes in the franchise-proliferation brands

The Highland Group 1111 Rosedale Drive Atlanta, GA (404)