2011 Smith Travel Research, Inc.1 Southern Lodging Summit 2011 Jan D. Freitag Senior Vice President

2011 Smith Travel Research, Inc.2 Agenda US Hotel Trends Chain Scale Trends Segmentation US Forecast Memphis Trends AH&LA Channel Study – A First Look Smith Travel Research, Inc. and/or STR Global, Ltd. (collectively for these purposes, “STR”) are the exclusive owners of all rights in these Industry Presentations and their content. Reproduction of all or a portion of these presentations for any purpose without prior approval of STR is strictly prohibited.

2011 Smith Travel Research, Inc / 2012 Recovery? Or Recovery!

2011 Smith Travel Research, Inc.4 Total US - Key Statistics YTD July 2011 % Change Hotels 52k Room Supply1.0 bn 0.8% Room Demand622 mm 5.4% Occupancy60.7% 4.6% A.D.R. $ % RevPAR$61 8.2% Room Revenue$63 bn 9.1%

2011 Smith Travel Research, Inc.5 Strongest Demand Rebound Ever. Supply Line Turning -6.9% -0.9% - 4.7% *Total US, Supply & Demand % Change, 12 MMA 1/89 – 7/11 6.5%

2011 Smith Travel Research, Inc.6 ADR Changes Get More Erratic in Each Downturn -8.8% -0.1% - 4.5% *Total US, ADR & Demand % Change, 12 MMA, 1/89 – 7/11 2.8%

2011 Smith Travel Research, Inc.7 If year 2000 ADR had increased by CPI each year… Note: 2011 & 2012 CPI forecast from Blue Chip Economic Indicators

2011 Smith Travel Research, Inc.8 On An Annualized Basis: Most Rooms Sold - EVER *Number of Rooms Sold, 12 MMA, 1/89 – 7/11

2011 Smith Travel Research, Inc.9 Chain Scales

2011 Smith Travel Research, Inc.10 Luxury – Four Seasons, Ritz Carlton, W Hotels, InterContinental Upper Upscale – Hyatt, Embassy Suites, Hilton, Marriott, Sheraton Upscale – Hyatt Place, Hilton Garden Inn, Courtyard, Hotel Indigo Upper Midscale – Best Western PLUS/Premier, Hampton Inn Midscale – Best Western, Country Inn & Suites, La Quinta Inn Economy – America’s Best Inn, Econolodge, Red Roof, Days Inn 2011 STR Chain Scales (Selected chains from each segment)

2011 Smith Travel Research, Inc.11 Demand Rebounds Nicely. Supply Growth in Upscale / UpMid. *US Chain Scales, Supply & Demand % Change, YTD 7/11

2011 Smith Travel Research, Inc.12 Healthy OCC Growth “Should” Lead to ADR Increases *US Chain Scales, Occupancy & ADR % Change, YTD 7/11

2011 Smith Travel Research, Inc.13 Selling 7 out of 10 Rooms “Should” Lead to ADR Increases *US Chain Scales, Absolute Occupancy %, YTD 7/11

2011 Smith Travel Research, Inc.14 After 4 Years Prior Peak ADRs Still Elusive *US Chain Scales, ADR $, YTD 6/07 vs. YTD 7/11

2011 Smith Travel Research, Inc.15 Segmentation Data

2011 Smith Travel Research, Inc.16 Transient Demand Rebounds Nicely, But … * Total Transient Demand in Millions of Rooms, 1/07 – 7/11. Millions

2011 Smith Travel Research, Inc.17 … At What Cost? * Transient ADR $, 1/07 – 7/11

2011 Smith Travel Research, Inc.18 Group Demand Recovers Nicely, But … * Total Group Demand in Millions of Rooms, 1/07 – 7/11

2011 Smith Travel Research, Inc.19 … Low Group ADR Will Take (At Least) A Year To “Burn Off” * Group ADR $, 1/07 – 7/11

2011 Smith Travel Research, Inc.20 US Forecast

2011 Smith Travel Research, Inc.21 Total United States Outlook Scenarios (% change vs. Prior Year) 2011P Hotel Industry Performance Scenarios 2011 Low RevPAR Growth Forecast High RevPAR Growth Supply Demand Occupancy ADR RevPAR

2011 Smith Travel Research, Inc.22 Total United States Chain Scale Key Performance Indicator Outlook 2011F by Chain Scale 2011 Year End Outlook Chain Scale Occupancy (% chg) ADR (% chg) RevPAR (%chg) Luxury Upper Upscale Upscale Upper Midscale Midscale Economy Total United States

2011 Smith Travel Research, Inc.23 Total United States Outlook Scenarios (% change vs. Prior Year) 2012P Hotel Industry Performance Scenarios 2012 Low RevPAR Growth Forecast High RevPAR Growth Supply Demand Occupancy ADR RevPAR

2011 Smith Travel Research, Inc.24 Total United States Chain Scale Key Performance Indicator Outlook 2012F by Chain Scale 2012 Year End Outlook Chain Scale Occupancy (% chg) ADR (% chg) RevPAR (%chg) Luxury Upper Upscale Upscale Upper Midscale Midscale Economy Total United States

2011 Smith Travel Research, Inc.25 Hotel Industry Forecasts – STR Revisions DemandADRDemandADR Jan Jun Aug

2011 Smith Travel Research, Inc.26 Takeways Demand Is Back ADR’s “Should” Follow Strong Demand Trust The Data

2011 Smith Travel Research, Inc.27 Memphis Trends

2011 Smith Travel Research, Inc.28 % Change Hotels246 Room Supply4.9 mm 0.5% Room Demand2.9 mm 3.4% Occupancy59.6% 2.9% Average Daily Rate $ % RevPAR$452.8% Memphis, TN - Key Statistics YTD July 2011

2011 Smith Travel Research, Inc.29 Supply Growth Muted - Strong Demand Rebound 9.0% 4.1% 1.0% -6.5% * Memphis, Supply & Demand % Change, 12 MMA, Jan ’07– July ’11 4.9%

2011 Smith Travel Research, Inc.30 ADR % Change Has Not Yet Turned Positive 10.2% % * Memphis, ADR & Demand % Change, 12 MMA, Jan ’00 – July ’ %

2011 Smith Travel Research, Inc.31 * Memphis ADR, 12 MMA, Jan ’07 – July ’11 Absolute ADR Discounts Will Be Felt For A While -10% $84 $76

2011 Smith Travel Research, Inc.32 Memphis Downtown Select Set Springhill Suites Memphis Downtown Madison Hotel Sleep Court Square Memphis Hampton Inn Suites Beale Street River Inn Of Harbor Town Courtyard Memphis Downtown Residence Inn Memphis Downtown Westin Memphis Beale Street King`s Court Motel Holiday Inn Select Memphis Downtown Marriott Memphis Downtown Preferred The Peabody Memphis Comfort Inn Downtown Memphis Econo Lodge Memphis Doubletree Hotel Memphis Downtown Benchmark Hotel

2011 Smith Travel Research, Inc.33 % Change Hotels16 Room Supply612 k0.1% Room Demand413 k 1.0% Occupancy67.6%1.0% Average Daily Rate $1290.1% RevPAR$871.0% Memphis Downtown Select Set - Key Statistics YTD July 2011

2011 Smith Travel Research, Inc.34 Downtown Discounts Continue 6.8% % * Select Set, ADR & Demand % Change, 12 MMA, Jan ’07 – July ’ % %

2011 Smith Travel Research, Inc.35 AH&LA Channel Study - A First Look - Smith Travel Research, Inc. and/or STR Global, Ltd. (collectively for these purposes, “STR”) are the exclusive owners of all rights in these Industry Presentations and their content. Reproduction of all or a portion of these presentations for any purpose without prior approval of STR is strictly prohibited.

2011 Smith Travel Research, Inc.36 Agenda Introduction US Data Scale Data Other Examples

2011 Smith Travel Research, Inc.37 Channels Brand.com – Marriott.com, Starwood.com, hotel’s own web site CRS/Voice – hiltons, ichotels, 3 rd parties also GDS – travel agent (Sabre, Galileo, Amadeus, Worldspan) OTA – online travel agents Property Direct/Other – walk-in, group/rooming list, employee/discount, contract

2011 Smith Travel Research, Inc.38 Participation 24,500 properties submitted data All of the major players –95 chains –25 additional companies

2011 Smith Travel Research, Inc.39 US Data

2011 Smith Travel Research, Inc.40 Demand & Revenue Share (%) by Channel Total US, 2010

2011 Smith Travel Research, Inc.41 OTA Demand & Revenue Share (%) by Business Model Total US, 2009 & 2010

2011 Smith Travel Research, Inc.42 ADR ($) by Channel Total US, Annual 2009 & 2010

2011 Smith Travel Research, Inc.43 ADR ($) by OTA Business Model Total US, 2009 & 2010

2011 Smith Travel Research, Inc.44 Absolute Room Demand by Channel (in millions) Total US, 2009 & 2010

2011 Smith Travel Research, Inc.45 Absolute Revenue by Channel (in billions $) Total US, 2009 & 2010

2011 Smith Travel Research, Inc.46 Scale Data

2011 Smith Travel Research, Inc.47 Property Direct/Other Demand Share (%) by Scale Percent of Total Demand, Annual 2009 & 2010

2011 Smith Travel Research, Inc.48 GDS Demand Share (%) by Scale Percent of Total Demand, Annual 2009 & 2010

2011 Smith Travel Research, Inc.49 Brand.com Demand Share (%) by Scale Percent of Total Demand, Annual 2009 & 2010

2011 Smith Travel Research, Inc.50 CRS/Voice Demand Share (%) by Scale Percent of Total Demand, Annual 2009 & 2010 Higher percentages in upper scales & Independents YOY decrease for most every scale

2011 Smith Travel Research, Inc.51 OTA Demand Share (%) by Scale Percent of Total Demand, Annual 2009 & 2010

2011 Smith Travel Research, Inc.52 ADR for Luxury Scale by Channel Annual 2009 & 2010

2011 Smith Travel Research, Inc.53 Additional Data

2011 Smith Travel Research, Inc.54 Top 10 Markets - OTA Demand % Annual 2010, OTA demand as % of total demand

2011 Smith Travel Research, Inc.55 Channel ADR ($) for 5 Metro Markets Annual 2010

2011 Smith Travel Research, Inc.56 Comp Sets Generated US comp set data 9,000 full comp sets 21,000 sufficient (greater than 4 hotels participating)

2011 Smith Travel Research, Inc.57 Channel Demand Share for Sample Property in NY Demand Share as percent of Total Demand, Annual 2010

2011 Smith Travel Research, Inc.58 Length of Stay Data Most companies submitted “Number of Reservations” along with “Room Nights” and “Revenue” Allows us to calculate Length of Stay per Channel

2011 Smith Travel Research, Inc.59 Length of Stay (Days) by Channel Upper Upscale / Upscale Chains, Annual 2010

2011 Smith Travel Research, Inc.60 Channel Study Findings to be published in mid-September Corporate monthly product in H1 of 2012 Property Comp Set product out thereafter More research is needed

2011 Smith Travel Research, Inc.61 Click on “Industry Presentations” Smith Travel Research, Inc. and/or STR Global, Ltd. (collectively for these purposes, “STR”) are the exclusive owners of all rights in these Industry Presentations and their content. Reproduction of all or a portion of these presentations for any purpose without prior approval of STR is strictly prohibited.