Supporting Hotel-related Academic Research and Education

Supporting Hotel-related Academic Research and Education
How to Conduct a Market Study The STR SHARE Center Supporting Hotel-related Academic Research and Education

Table of Contents Typical Hotel and Tourism Industry Research Projects
STR Ad-Hoc Industry Reports and Data Files Audience, Logistics and Timing Sample Market Study Sample Impact Analysis - future Sample Feasibility Study - future

Typical Hotel and Tourism Industry Research Projects

Typical Research Projects
Three of the most popular types of research projects conducted by hotel and tourism industry professionals are: Market Study – An overview of the hotel industry in a particular area, such as a country, city or another geographic segment. Impact Analysis – What is the impact of some event on the hotel industry in a specific area? Feasibility Study – Is it feasible (a good business decision) to build a specific type of hotel in a specific area?

Additional H&T Research Projects
There are other types of research projects conducted by hotel and tourism industry professionals: Development Analysis – A study of the historic and future Supply changes in a particular area. Profitability Analysis – A study of total revenues, expenses and profitability for hotels in a particular area. Abbreviated versions of both of these could be included in a very thorough Market Study. Comprehensive versions of both of these could stand alone and provide valuable insights into the hotel industry for a specific area.

What is a Market Study? Analysis of a group of hotels to provide an overview of the hotel industry and share insights How is the group of hotels performing and what makes them unique The group of hotels could be a geographic area: Market or a city, or a Tract/Submarket Country or a subset of a country with multiple cities, such as a state/province or a region of a country Continent or a subset, such as a Subcontinent or a group of countries, or the whole world

What is a Market Study continued
The group of hotels could be a specific industry segment: Class or Scale group of hotels such as Luxury, Upper Upscale, Midscale or Economy Type of hotels such as Resort, Boutique, Convention or Extended Stay Brand or Company for a specific customer including their confidential data Location group of hotels such as Urban, Suburban or Interstate

What is a Market Study continued
Analysis of a specific hotel - future This could be in the case of a hotel development (new build), sale, refinancing or assessment This type of market study would include the forecasting of revenues and expenses There would usually be an estimation of the market value of the specific hotel A good resources is “Hotels and Motels, Valuations and Market Studies”, Rushmore & Baum

Types of Data for a Market Study
The types of data used for a Market Study include: Size and structure information – property and room counts by various categories Performance information – 12-month moving average, monthly and daily occupancy, ADR, RevPAR, Supply, Demand and Room Revenue Pipeline data – past and future development information Profit and Loss data - Annual revenues, expenses and profits Hotel Census data – attribute information for properties Forecast data – future performance projections

All research projects – what’s the point?
Market studies, impact analyses and feasibility studies all analyze historic data to identify trends. You are “looking for a story”, relevant information that can help the audience. Sometimes you analyze a lot more data than what ends up in your final presentation, because you are looking for a story. Your presentation should definitely include industry takeaways. How do your findings benefit an industry professional. They can also make recommendations regarding the future or indicate important things to be watching in the next months or years.

What is a Feasibility Study? - future
Is it a good business decision to build a hotel Could be specific – Is it feasible to build a Luxury hotel in this exact area? Could be open ended – What hotel should be built in this exact area?, or … Where should you build a Luxury hotel?, or even … Where should you build what hotel?

Types of Data for a Feasibility Study
Similar to a Market Study, the types of data include: Size and structure information – understand the market Performance information - for hotels like the one you are proposing and for the rest of the market Pipeline data – what will impact the future, has anyone beaten you to the punch Profit and Loss data – critical because you have to estimate the profitability Hotel Census data – understand your future competitors Forecast data – help you project the future

Additional Data There are many other types of data that can enhance a Feasibility Study, as well as a Market Study or Impact Analysis, including: Demographic – population, breakdowns, .. Tourism – arrivals/departures, attractions, … Business – types, growth, … Economic - … Geographic – infrastructure developments, … Political – stability, regulations, …

Elements of a Feasibility Study?
A feasibility study starts with a thorough market study to try and understand all there is to know about the area that is proposed If the type of hotel is proposed, then the market study can be more focused You need to understand the size and structure and the attributes of the hotels that already exist Generally, there won’t be too many hotels exactly like the one that you are proposing Be sure to understand the ones that are most similar, since they will be your main competition

Elements continued You need to analyze the monthly and daily performance data to see how the hotels in your area are currently doing For the whole market and for the hotels that are similar to yours You will need to select a small group to simulate your projected performance You need to review the pipeline data to see if hotels similar to your have recently opened or if they are expected to open in the future This will significantly impact your performance Someone else may have already had your good idea

Elements continued Use forecast data to help project future performance Look for multiple sources of local and regional (larger area) hotel-related forecast data Look for additional forecast data (economic, tourism) Profit and Loss data is critical to help estimate your profitability You can select a small group of hotels similar to yours, just like for the performance data You can also select hotels very close to yours in comparable areas nearby

When there is Flexibility Related to the Area?
There are many theories for identifying high potential development areas Many look at consistent RevPAR growth over time Some look at stability during economic cycles Most will look at recent and future development Many look at the current hotels and the opportunity to develop a unique new product Often a group of potential development areas will be selected and tracked over time before a final decision is made

When the Type of Hotel is Flexible?
There are situations when the area is specified, but you are asked to propose the type of hotel In this case, the Feasibility Study starts with an analysis of the entire market to understand all different types of hotels, how they are performing, the development activity and the profitability You are looking for opportunities that still exist or that others have not already realized Then you need to justify your proposal with solid data

Feasibility Studies – Is “No” a good answer?
There are times where “No” is the correct answer, in other words, “Is it not feasible to build the type of hotel in the specific area” Some development is not based on good data There are lots of other factors that can get involved which are not logical Unfortunately, too much development is based upon ego or preconceived notions There is frequently the opportunity to propose an “outside the box” alternative

Application 1 – Types of Research Projects
What are the three most popular types of hotel and tourism industry research projects? What is the main objective of each project?

What are the three most popular types of hotel and tourism industry research projects? What is the main objective of each project? 1. Market Study 2. Impact Analysis 3. Feasibility Study

What are the three most popular types of hotel and tourism industry research projects? What is the main objective of each project? 1. Market Study An overview of the hotel industry in a particular area 2. Impact Analysis What is the impact of some event on the hotel industry in a specific area? 3. Feasibility Study Is it a good business decision to build a specific type of hotel in a specific area?

Application 2 – Which research projects utilize which types of data?
Types of data / Research Market Study Impact Analysis Feasibility Study Monthly and daily performance data Profit and Loss data Past and future development data Size and structure information on hotels Property attribute data Projected performance data

Types of data / Research Market Study Impact Analysis Feasibility Study Monthly and daily performance data X Profit and Loss data Past and future development data Size and structure information on hotels Property attribute data Projected performance data

Types of data / Research Market Study Impact Analysis Feasibility Study Monthly and daily performance data X Profit and Loss data possibly Past and future development data Size and structure information on hotels Property attribute data Projected performance data

Types of data / Research Market Study Impact Analysis Feasibility Study Monthly and daily performance data X Profit and Loss data possibly critical Past and future development data Size and structure information on hotels Property attribute data Projected performance data

STR Ad-Hoc Industry Reports and Data Files Related to Typical Research Projects

STR Ad-Hoc Reports and Data Files
The most popular types of Ad-Hoc Report are: Trend Report – monthly and daily performance data HOST/Profitability Report – annual Profit and Loss data Pipeline Report – development information, past and future Additional Ad-Hoc Reports and Data files include: Property and Room Counts – size and structure data Hotel Census Database – hotel attribute information Forecast – future performance projections

STR Ad-Hoc Reports and Data Files – More Info
If you are not familiar with the Ad-hoc Industry reports, there is a thorough introduction in the “Certification in Hotel Industry Analytics” training material. This training material is also duplicated at the end of this training in Appendix 1. Samples of these reports as well as data that you might need for a student project are available from the STR SHARE Center,

Types of data utilized for hotel industry research projects STR Ad-Hoc Report Monthly and daily performance data Profit and Loss data Past and future development data Size and structure information on hotels Property attribute data Projected performance data

Types of data utilized for hotel industry research projects STR Ad-Hoc Report Monthly and daily performance data Trend Report Profit and Loss data HOST/Profitability Report Past and future development data Pipeline Report Size and structure information on hotels Property and Room Counts Property attribute data Census Database File Projected performance data Forecast Report

Audience, Logistics and Timing

Understanding the Audience
Before a presentation, it is good to know as much as possible about the audience and the engagement. Here are some questions that STR uses: What are your expectations for my talk? What do you want me to cover? How many people will be in the audience? How long do you want the presentation to be? What is the audience’s level of “sophistication”? What level of interaction have they had with the data? Was there a prior presenter in the past covering this topic? If so, can I have a copy? Are there are other speakers? Am I part of a panel? If so, who else is on the panel and what will they be covering?

Confirming Logistics Be sure to ask about logistics. Here are some STR questions that might help: Will I stand behind a podium? Sit? Walk around the stage or room? Will I have to use a podium mic? A lavaliere mic? A handheld mic? Can the lights in the room be dimmed? If not, make sure that your slides can be read in broad daylight / full light. What is the dress code of the event? Will there be a confidence monitor? Will I use my own laptop? If you use their laptop, make sure that they have a compatible version of your software and if not sure, test it. Request a bottle of water to be placed on the stage. Do I need to send in my slides in advance? Where does the actual presentation take place? Ask about a dress rehearsal time.

Respecting the Timing Respecting the timing is critical. Be sure you know exactly how much time you have and is the time flexible or firm. Usually there will be questions and answers after your presentation. How much time for Q&A and is that included or excluded in the time you are allotted? How much material you cover depends upon the time and the audience. An approximate rule of thumb for an experienced presenter is no more than a slide per minute, but with a less sophisticated audience that may be overwhelming. Focus on the most important “stories” and industry relevant takeaways. Be sure to practice with a timer.

Be the expert, but a humble one
Data can make you the expert. Remember this; it can increase your confidence level. Of course, you need to thoroughly analyze the data as well. You can review your findings with people who know the market, especially if there are things that are counter intuitive. Most likely the data is new to most of your audience. However, there may be people in your audience that know your market much better than you, so be humble about the fact that you may be an outsider or not know everything. Sometimes you can take advantage of and benefit from experienced audience members. You can ask them questions.

Sample Market Study for Nashville, Tennessee, USA

Sample Market Study - Components
General Makeup of the Market Current Statistics Trended Data Economic Cycles Market Breakdown Comparable Markets Types of Business Daily Data Pipeline and Development Data HOST/Profitability Data Forecast Data Summary

General Makeup of the Market

General Makeup – Property and Room Counts
Property and Room counts provide valuable “size and structure” information about the organization of the hotel industry in a geographic area These show the number of properties and rooms by various geographic and non-geographic categories, including a total for the whole market Counts include numbers for: Census – hotels in the STR database Sample – hotels that submit performance data (Occupancy, ADR, RevPAR) to STR

Property and Room Counts continued
The Sample counts are important to emphasize, since it shows how representative the data is For example, if a market has mainly high end hotels participating, then the performance data will be more swayed to those types of hotels Property and Room Count data can be displayed in table format or using bar graphs Groups such as Brands can be sorted in order, usually by number of Census Rooms, to help show largest and smallest

Properties and Rooms by Tract/Submarket Nashville Market, counts as of July 2015
Submarket/ Tract Census Properties Census Rooms Sample Properties Sample Rooms Nashville CBD, TN 49 9,207 48 9,173 Nashville Airport, TN 68 11,156 54 10,021 Nashville I-65 North, TN 50 3,888 29 2,641 I-24/Murfreesboro, TN 61 5,282 46 4,249 Brentwood/Franklin, TN 39 4,697 36 4,535 Nashville Other Areas, TN 62 4,058 41 2,991 Nashville Airport is the largest tract (by number of rooms), then the CBD

Properties and Rooms by Scale Nashville Market, counts as of July 2015
Census Properties Census Rooms Sample Properties Sample Rooms Luxury Chains 1 340 Upper Upscale Chains 17 8,531 Upscale Chains 43 6,052 42 6,027 Upper Midscale Chains 72 7,753 71 7,726 Midscale Chains 44 3,665 3,487 Economy Chains 83 7,310 76 6,723 Independents 69 4,637 5 776 Only one Luxury chain hotel, Upper Upscale and Upper Midscale are the largest scale groups, then Economy and Upscale, Midscale and Independents are the smallest

Properties and Rooms by Class Nashville Market, counts as of July 2015
Census Properties Census Rooms Sample Properties Sample Rooms Luxury Class 3 709 Upper Upscale Class 17 8,531 Upscale Class 44 6,145 42 6,027 Upper Midscale Class 73 7,949 72 7,922 Midscale Class 47 3,899 43 3,621 Economy Class 145 11,055 77 6,800 2 Luxury Class independent hotels, 0 Upper Upscale independents, 1 Upscale and Upper Midscale independent each, 3 Midscale and 76 Economy independents

Properties and Rooms by Location Nashville Market, counts as of July 2015
Census Properties Census Rooms Sample Properties Sample Rooms Urban 65 10,290 49 9,327 Suburban 152 13,727 117 11,785 Airport 67 8,513 56 7,425 Interstate 41 2,743 30 2,131 Resort 1 2,882 Small Metro/Town 3 133 60 Most Suburban, similar amount of Urban and Airport, some Interstate, few others

Properties and Rooms by Size Nashville Market, counts as of July 2015
Census Properties Census Rooms Sample Properties Sample Rooms Less Than 75 Rooms 122 6,143 70 4,034 Rooms 161 17,274 141 15,213 Rooms 32 6,590 29 6,082 Rooms 11 3,926 Greater Than 500 Rooms 3 4,355 Most hotels in room range, then Under 75, 46 above 150 including 3 above 500

Properties and Rooms by Chain – in table format Nashville Market, as of July 2015, Chains with 500+ rooms, sorted by rooms Chain Census Properties Census Rooms Sample Properties Sample Rooms Gaylord Entertainment 2 3,185 Holiday Inn Express 15 1,710 Courtyard 8 1,171 Hampton Inn & Suites 10 1,140 Embassy Suites 4 1,037 Days Inn 13 1,010 Marriott 3 999 Sheraton Hotel 892 Hilton Garden Inn 6 861 Hyatt Place 809 Omni 1 800 Holiday Inn 787 La Quinta Inns & Suites 7 773 Extended Stay America 741 Hampton Inn 691 Renaissance 673 Residence Inn 5 659 Super 8 9 656 DoubleTree 647 Comfort Suites 604 Quality Inn 589 Americas Best Value Inn 569 251 Homewood Suites 547 Best Western 536 Hilton 533 Comfort Inn 511

Nashville - Top Chains by Number of Rooms – in bar graph format As of July 2015, Chains with Greater than 500 rooms, based upon Census Rooms

Property and Room Count - Hints
Bar graphs can be used to visually display the count data by segment. Usually graphs would be based upon Census Rooms. Identify larger and smaller segments, usually by Census Rooms Identify number of independents and differences by Scale versus Class. You can combine both counts in one table. Note counts of different Location and Size groups to help understand makeup of market if relevant Identify top chains in a market Note participation differences if relevant

Additional Size and Structure Info
Additional Property and Room Count alternatives: By Age (of hotel) By Parent company By Operation (Corporate, Franchise, Independent) Some options such as Scale or Location may not be relevant, especially in certain parts of the world If there are a large number of independent hotels, you might skip the Scale numbers In smaller markets or remote areas, Location may not be relevant

Size and Structure Info continued
Special Types of hotels – the Census Hotel Database can be used to help obtain counts of various special types of hotels including: Boutique Hotels Convention Extended Stay Suites All Inclusive Destination Resorts Condotels Oceanfront Membership in Marketing groups

General Market Makeup continued
Specific hotels of interest – the Census Hotel Database can be used to identify specific hotels including: Oldest Newest Largest Historic Popular – based on criteria like reviews You can include relevant hotel data such as Open Date, Number of Rooms, and comments or notes.

Nashville Hotels of Interest Nashville Market, counts as of July 2015
Feature Hotel Name Rooms Open Date Comment Largest Gaylord Opryland Hotel 2882 197706 Spa, Convention 2nd largest Omni Nashville Hotel 800 201309 3rd largest Renaissance Nashville Hotel 600 198708 Convention Oldest Hermitage Hotel 122 1910 Boutique, Luxury Class Historic Autograph Union Station 125 198606 Built in old train station Luxury Chain Loews Vanderbilt Plaza Hotel 340 198406 Luxury Class Hutton Hotel 247 200902 Spa 5 other Convention hotels and 3 other Boutique hotels (2 Aloft and Indigo)

General Market Makeup continued
Market Characteristics - you can include general information (and recent changes) about the market that you can find from external sources, regarding: Demographics Sporting arenas Neighborhoods Shopping areas Businesses Historic areas Universities Attractions Hospitals Events Convention centers Conferences Maps for US markets are available from STR that show the various tracts/submarkets with the market

Nashville Neighborhoods
STR Nashville Market Map with Tracts (future) Nashville Neighborhoods – Nashville Airport

Opryland Hotel and Grand Ole Opry
Nashville Attractions, Arenas, Stadiums, Convention Center, Universities and Businesses (from external sources) Sounds Stadium Titans Stadium Several Hospitals Convention Center, Country Music Hall of Fame, Bridgestone Arena (Predators, concerts), Symphony Center, Broadway Vanderbilt University Music Row Belmont University Nashville Int’l Airport

Nashville Neighborhoods (from external sources)
Urban Downtown Gulch Vandy (Vanderbilt) Hillsboro East Nashville Suburbs Green Hills Brentwood Franklin Hendersonville

Nashville Convention Center - open
Nashville Major Events Nashville Convention Center - open Nashville Music City Center opened May 2013 Broadway (honky tonk) Bridgestone Arena Omni Hotel – opened October 2013, 800 rooms Country Music Hall of Fame TV series – October 2012 Nashville Flood May 2010 Gaylord Opryland Hotel Closed May – Nov, 2010 due to flood

Current Statistics

Current Statistics The objective when it comes to showing “Current Stats” for a market is to show a snapshot of how the market is performing right now Display a range of metrics including: Key Performance Indicators – Occupancy, ADR, RevPAR Raw Values – Supply, Demand, Revenue Display both the Actual Values and the Percent Changes Normally display Running 12 month metrics since that shows the long term trend

Current Stats continued
Depending upon the time frame, you can display Annual numbers. YTD numbers are not recommended since they don’t factor in data for the whole year You can display in table format or in bar graphs. Bar graphs are hard since the data is so different. You can use asterisks to indicate metrics that are records, either historic (all time) or as of certain date – check the past performance data to determine whether the current numbers are records or not

Current Stats continued
You can also show Ranking information when it comes to the various metrics For the rank, you could compare the subject market to all of the other markets in the country or the world, or to a specific group that you are studying. (For this you would need similar snapshot information for all of the other markets.) For each metric (Supply, Demand, Revenue, Occupancy, ADR, RevPAR values and percent changes) determine the position of the subject market among the others. You can include additional columns for the rank.

Nashville Market - Key Statistics Based upon Running 12 Month data ending July 2015 Supply, Demand and Revenue are annualized; Rank is among 163 US markets Values Rank % Change Rank Hotels 329 * 66 Rooms 38,288 * 36 Room Supply 13.8 M * % 40 Room Demand 10.1 M * % 30 Occupancy 73.2% * % 56 ADR $ * % 3 ** RevPAR $90.10 * % 6 ** Room Revenue $1.24 B * % 2 ** * Notes historic record for the market, ** Notes high values for the US

Current Stats for Multiple Years
You can use multiple bars to display various stats for the last couple of years. You can use Running 12-month data from prior years or annual data for prior years and YTD data for the current year. The other approach to display historic data is to use line graphs which will be demonstrated in the next section Don’t overdo it. You may not want to use both. (If there are two ways of showing similar data, try both and decide which method is clear and makes the point the best.)

Hint – Combining Annual and YTD data
The disadvantage of combining Annual data for some years and YTD data for the current year is that your YTD data will be impacted by the specific months in the YTD time period. A September YTD number will leave out important months of October and November and may make the YTD number look poorer that it really is. By using Running 12-month numbers, you remove this possible distortion. You could also look at YTD numbers for multiple years for a different perspective.

2010 ADR affected by downturn and flood
Nashville KPIs for last 6 years - Occupancy, ADR and RevPAR Annual Occupancy, ADR and RevPAR for and YTD values for 2015 Consistent increase in occupancy, ADR increase sharper in 2014 and 2015YTD, 2010 ADR affected by downturn and flood

Nashville % Changes for last 6 years - Occ, ADR and RevPAR Annual Occupancy, ADR and RevPAR % Chgs for , YTD values for 2015 Strong Occupancy growth coming out of downturn, generally strong ADR growth as well, 2012 could have been related to CC, double digit RevPAR in recent years

Nashville % Chgs for last 6 years – Supply, Demand, and Revenue Annual Supply, Demand, and Revenue % Chgs for , YTD values for 2015 Supply and Demand growth higher than US average for last 5 years 2010 Supply and 2011 Demand affected by flood

Trended Data

Trended Data Longitudinal historic data
Running 12 month, seasonally adjusted, or monthly numbers Percent changes (positives and negatives) and actual values Key performance indicators and raw values Highlight trend over time Show change from start to finish Certain metrics are typically graphed together such as Supply and Demand or Occupancy and ADR

Demand numbers strong in last 5 years, Supply numbers above US average
Nashville - Room Supply & Demand Percent Change Twelve Month Moving Average – January 1990 to July 2015 13.7% Recovery 5.7% 1.6% Flood Downturn -8.8% Demand numbers strong in last 5 years, Supply numbers above US average

Nashville – Actual Room Supply and Demand Twelve Month Moving Average – January 1990 to July 2015
Flood Downturn Downturn Steady increase in Supply even in recent years, Sharp increase in Demand in last 5 years

Nashville Market – Occupancy & ADR Percent Change Twelve Month Moving Average – January 1990 to July 2015 Recovery 12.8% 9.3% 10.5% 4.1% Downturn -5.9% -11.4% Strong recovery, Occupancy numbers above 4%, ADR reaccelerated in double digits

Since 2013, Occupancy and ADR trending similarly, both very strong
Nashville – Actual Occupancy and ADR Twelve Month Moving Average – January 1990 to July 2015 Previous peak: 70.1% Current: 73.2% Surpassed in July 2014 Since 2013, Occupancy and ADR trending similarly, both very strong

Since 2013, strong RevPAR growth
Nashville - RevPAR Percent Change and Actual Twelve Month Moving Average – January 1990 to July 2015 18.6% 16.9% 15.0% -14.6% Since 2013, strong RevPAR growth

Trended Data Hints Point out peaks, valleys and current metrics
You can show drops, recoveries, and current location versus prior peak Note special events and economic cycles Zoom in to show detail of shorter time periods when crowded Note interaction between various metrics such as affect of Occupancy on ADR (follows 6-12 months) Remember basics: Occupancy = Demand/Supply and RevPAR is combination of Occupancy and ADR

Trended Data and a Comparable
When displaying trended data, it can be interesting to compare the market being studied to a different geographic area. For example, you could compare your market to the total country number, a continent number, another market, or a group of markets such as Top 10. You can compare how your market was impacted by economic cycles or various events versus the comparable(s). In this situation, you probably want to just graph one metric rather than two at a time.

Much stronger recovery (2010-2012) in Nashville compared to Total U.S.
Nashville versus U.S. - Demand Percent Change – just a sample Twelve Month Moving Average – January 1990 to July 2015 13.7% Recovery 5.7% 1.6% Flood Downturn -8.8% Much stronger recovery ( ) in Nashville compared to Total U.S.

Economic Cycles

Economic Cycles Compare different downturns and recoveries
Show performance and duration differences of successive cycles Show peaks and valleys. You can also note time (number of months) from peak to valley and then back to peak. For ADRs, you can use actual amounts or inflation-adjusted amounts or both You can show “indexed time series” for similar events, such as downturns and recoveries. Determine starting date (month) and graph separate lines for each different event.

Basic fundamentals and sample graphs - optional
The next three slides show important examples of graphing data to help understand some data fundamentals: Running 12-month data versus monthly data – the running 12-month data removes the seasonal distortion (noise). Occupancy is a combination of Supply and Demand – compare the percent changes for Supply and Demand to the percent change for Occupancy. Remember Supply will have a negative impact. RevPAR is a combination of Occupancy and ADR - Occupancy and ADR will add up to the RevPAR, so if both percent changes are positive, RevPAR will be higher. If both are negative, RevPAR will be lower. If positive and negative, RevPAR will be in the middle.

12-month data removes all of the small ups and downs of monthly data
Nashville Market – ADR Percent Change, Monthly vs. 12-Month Twelve Month Moving Average – January 1990 to July 2015 Recovery 12.8% 9.3% 10.5% 4.1% Downturn -5.9% -11.4% 12-month data removes all of the small ups and downs of monthly data

Supply and Demand equate to Occupancy
Nashville - Room Supply, Demand and Occupancy % Change Twelve Month Moving Average – January 1990 to July 2015 Recovery Downturn Flood Supply and Demand equate to Occupancy

Occupancy and ADR equate to RevPAR
Nashville Market – Occupancy, ADR and RevPAR Percent Change Twelve Month Moving Average – January 1990 to July 2015 Recovery Downturn Occupancy and ADR equate to RevPAR

Market Breakdowns

Market Breakdowns By various geographic & non-geographic categories:
Tract/Submarket Class and/or Scale Additional possibilities: Location, Size, Age or Types Issues related to categories If a single category is not sufficient (due to participation), you either have to leave it out, or combine it with another category (probably preferred) Key Performance Indicators Actual values and/or Percent changes

Market Breakdowns - continued
Current Data Running 12 month (default), or … Annual (depending upon time of presentation), or … YTD Display different ways: Single bar for each category, especially if there are lots of categories, or … Multiple bars for more than one metric (Supply and Demand) or for more than one year for each category, or … Historic trend lines for each category – this can be a lot of data and hard to display, depending upon detail needed and length of presentation

Geographic Breakdowns - Hints
Sometimes the geographic area is not an STR Market Tract/Submarket (remember these names are synonymous) You can use smaller geographic areas related to postal codes, counties, or cities You can create user defined groups of select properties that could relate to neighborhoods or downtown versus suburbs State/Province – use separate markets or big cities Country – all or larger markets/cities or states/provinces Subcontinent – all or larger countries or markets/cities Continent or World – subcontinents, counties or major markets

Nashville by Scale – Supply & Demand Percent Change Running Twelve Month data as of July 2015
Note Luxury and Upper Upscale combined has strong Demand growth along with Economy, Upscale has very strong Supply and Demand growth, Midscale has negative Supply growth

Nashville by Scale – Supply Percent Change for last 5 years Running Twelve Month data as of July 2015 Strong Supply growth in Upscale segment for 2014 and 2015, moderate Supply growth over time in Luxury/Upper Up and Upper Mid segments, negative growth in Mid and Econ

Nashville by Scale - Occupancy & ADR Percent Change Running Twelve Month data as of July 2015
Strongest Occupancy growth in Midscale and Economy related to cycles, upper segments saw this growth last year, all segments experiencing very high ADR growth

Nashville by Scale – Actual Occupancy and ADR Running Twelve Month data as of July 2015
Strong Occupancies (77-80) for upper segments, even pricing premiums for upper segments (26 and 26), larger ADR gap between Midscale and Upper Midscale

Nashville by Scale - RevPAR Percent Change & Actuals Running Twelve Month data as of July 2015
All RevPAR Percent Changes in double digits, Actual RevPAR differences similar to ADRs with gap between Midscale and Upper Mid

Hint – Displaying RevPAR
Less experienced audiences may not be as familiar with RevPAR. If you display Occupancy and ADR, that may be enough, especially when pressed for time. For more experienced audiences you can discuss the contribution of Occupancy and ADR to RevPAR For example in a recovery, frequently Occupancy growth contributes more to RevPAR growth at first and then later ADR growth contrbutes more to RevPAR growth You can display RevPAR Percent Change and not cycles (time periods) when they are positive and negative

Nashville by Scale - RevPAR Percent Changes over time - busy Twelve Month Moving Average – January 2000 to July 2015 Crowded, might be able to see differences in upper versus lower segments over time

Nashville by Scale - RevPAR Percent Changes – zoom in Twelve Month Moving Average – January 2010 to July 2015 Zoom in to see strength of Upscale and Upper Midscale segments, Luxury and Upper Upscale are stable, Midscale and Economy are catching up

Hint – Lots of line graphs
Multiple line graphs can be way too busy and not really understandable You can try and vary the line type (dotted, dashed) to try and help You can try and zoom in on smaller periods of time You can also try and combine groups to get a smaller number of lines Using multiple bar graphs (such as for different years back in time) may be visually easier to understand

Nashville by Tract – Supply & Demand Percent Change Running Twelve Month data as of July 2015
Strong Supply growth in CBD (only tract in market above 2), Strong Demand growth in several tracts: North, CBD, Other Areas, and Murfreesboro

Nashville by Tract - Occupancy & ADR Percent Change Running Twelve Month data as of July 2015
Strong Occupancy growth in North and Other Areas (catching up), Strong ADR growth in all tracts especially North and CBD

Nashville by Tract – Actual Occupancy and ADR Running Twelve Month data as of July 2015
Strongest Occupancies and ADRs in CBD, then Brentwood/Franklin and Airport; Murfreesboro has Occupancy above 70; North and Other Areas similar

Nashville by Tract - RevPAR Percent Change & Actuals Running Twelve Month data as of July 2015
Strong RevPAR growth (double-digit) in all tracts; very large growth in North; Actual RevPAR very high in CBD, high in Airport and Brentwood/Franklin

Shows difference/strength of downtown tract yet similar RevPAR
Nashville CBD versus Other Tracts – Percent Chgs (Sup, Dem, KPIs) Downtown tract vs. all others combined, Running Twelve Month data as of July 2015 Combining multiple metrics for two categories (CBD versus all other tracts), Shows difference/strength of downtown tract yet similar RevPAR

Comparable Markets

Comparable Markets Similar markets What criteria?
Nearby or ones with similar characteristics In the same country or the world What criteria? Related to convention/group business Related to leisure Related to proximity Who decides on comparables? Local tourism organization, such as a CVB Researcher’s best determination based upon criteria above

Comparable Markets continued
Metrics Size and structure Actual values or percent changes Versus comparable markets or versus top markets in country or top markets in the world Top 10 or 25 Total average of Top versus non-Top Versus other markets in the same state, when applicable

Nashville versus Top 25 Markets – Number of Hotel Rooms As of July 2015, in thousands, based upon STR Global database

Nashville vs. Tennessee Markets – Actual Occupancy and ADR Running Twelve Month data as of July 2015
Nashville far exceeds other Tennessee markets in Actual Occupancy and ADR

Nashville vs. Comparable Markets – Supply & Demand % Change Running Twelve Month data as of July 2015 Supply and Demand growth among top of comparable markets, some markets with low metrics

Nashville vs. Comparable Markets - Occupancy & ADR % Change Running Twelve Month data as of July 2015 Occupancy growth similar to comparable markets, ADR growth far superior

Nashville vs. Comparable Markets – Actual Occupancy and ADR Running Twelve Month data as of July 2015 Occupancy and ADR Actuals among top of comparable markets, some markets with low metrics

Nashville vs. Comparable Markets - RevPAR %Change & Actuals Running Twelve Month data as of July 2015 RevPAR growth highest among comparable markets, Actual RevPAR among the highest

Types of Business

Types of Business Weekday versus Weekend or Day of Week Seasonality
Compare actual Occupancies and ADRs Weekday/Weekend can help show Business versus Leisure differences Compare high and low days Display just current or multiple years (bars) Seasonality Display actual Occupancies or ADRs Monthly data for multiple years (12 month graph) Note high seasons, shoulder months

Nashville - Weekday/Weekend Actual Occupancy
Weekday, Weekend and Total Actual Occupancy, Annual 2010 – 2014 and YTD 2015 Average of 10% higher Occupancy on Weekends, but last 3 years more growth on Weekdays - Nashville a popular place for weekend getaways, but CC improving weekday numbers

Nashville - Weekday/Weekend Actual ADR
Weekday, Weekend and Total Actual ADR, Annual 2010 – 2014 and YTD 2015 Historically Weekday had higher ADR than Weekend, last 3 years more growth on Weekends - High weekend occupancies (80+) equal pricing power

Nashville - Actual Occupancy by Day of Week
Annual Day of Week Actual Occupancy, Running 12-Month data as of July Monday, Tuesday and Wednesday increased by 7-8 points; Saturday and Sunday by 5 points

Nashville - Actual ADR by Day of Week
Annual Day of Week Actual Occupancy, Running 12-Month data as of July In 2013 Tuesday and Wednesday equal to Friday and Saturday, since then slightly more growth on weekend days

Nashville Market – Historic Occupancy Seasonality Monthly Occupancy, January 2010 Through July 2015
Peak months of the year are March, June and October; March and October higher in 2014; August higher in 2015

Nashville Market – Historic ADR Seasonality Monthly ADR, January 2010 Through July 2015
Peak months are June and October, although March is growing; Note little more of a YOY increase starting in 2nd half of 2013

Types of Business continued
Group versus Transient Review definitions Compare Demand and ADR (Occupancy is hard to show) Running 12 Month or Annual Use Trended (lines) or Current Year (bars) Show Business mix - Percent of Group versus Transient Demand compared to Total Demand Note interaction between Demand and ADR for Transient and Group (greater lag for Group, negotiated farther out) Show differences in economic cycles

Nashville Group/Transient Mix Running Twelve Month Demand, Group & Transient as % of total – Jan 2005 to July 2015 2014 – 38% Group vs. 59% Transient 2005 – 59% Group vs. 37% Transient Major shift in Group and Transient Mix %, even in 2010, opposite in 2014, slight return in 2015

Nashville Group and Transient Actual ADR Running Twelve Month ADR, Group versus Transient – Jan 2005 to July 2015 Transient higher in positive cycle Flood affect Transient back higher again Transient lower in downturn and beginning of recovery Typical differences between Group and Transient in positive and negative cycles

Nashville Group and Transient Demand Percent Change Running Twelve Month Demand % Chg, Group vs. Transient – Jan 2005 to July 2015 Downturn Convention Center Flood Transient Demand growth never really went negative even during downturn; Group Demand recovered, then double-dipped, now strongly positive again

Very strong Group pricing in 2014 and 2015. much higher than U.S.
Nashville Group and Transient ADR Percent Change Running Twelve Month ADR % Chg, Group vs. Transient – Jan 2005 to July 2015 Recovery Strong positive Downturn Group follows Transient into downturn, prolonged flood effect and quick recovery, Very strong Group pricing in 2014 and much higher than U.S.

Daily Data - future

Daily Data Daily data allows you to analyze special events and their impact upon the hotel industry in a specific area. Their a wide range of different types of events (conferences, sporting, weather). They can be one-time or recurring and their impacts can be positive, negative or mixed. This type of study is reserved for an impact analysis and is generally not included in a market study, or if included, just very generally. In a Market Study, an interesting type of daily data that you could include is the number of Sellout Nights (usually around % occupancy or above) in a market. This can show how busy a market is.

Pipeline and Development Data

A Development Analysis
A Development Analysis is a comprehensive study of historic and future projected Supply changes in a specific area utilizing Trend data, Pipeline Reports, Census Database data and Property and Room Counts. This can be a thorough stand-alone research project. A Market Study can include a certain amount of this sort of development information for an overall perspective. The Pipeline Report by itself can provide a good overview of development information. For more detail, there is a separate training program on “How to Conduct a Development Analysis”

Development History from a Trend Report
On previous slides in the Trended Data section we talked about using the Trend Report to show Supply data over a long time period and the changes in Rooms Available. The next slide shows the Supply Percent Changes and Actuals for the whole market, depicting the growth in rooms. In addition to looking at the whole market, you can analyze data by various subsets of the market such as Scale or Submarket to determine the “hot” areas or types of hotels. In addition to Trend Reports, you can also use Property and Room Counts to analyze data by Brand and identify “hot” brands. Both of these are demonstrated in the “How to Conduct a Development Analysis” training.

Nashville – Actual Room Supply & Supply Percent Change Twelve Month Moving Average – January 1990 to July 2015 – from previous slides Shows Supply (Rooms Available) growth in Nashville over long period of time

Development Overview using a Pipeline Report
The Pipeline Report provides a great overview of development activity in an area. The Summary page provides an overview of historic development during the last 5 years and an overview of future development which is projected to take place, approximately during the next 5 years. The Brand Summary page and the Data by Property page provide detailed data on future development. The Changes to Existing Supply provides detail on Conversion and other Supply Changes which may be outside the scope of a Market Study.

Historic Development over Time
The Historic Supply section on the Summary page provides a snapshot of Scale development over time. As of the current month, you look back in time for the last 5 years. The table shows the number of Hotels and Rooms in each Scale group for the last 5 years. The total number at each time interval is displayed. If you subtract the numbers from one year to the next, you can determine the differences, which can be positive (usually new opens) or negative (usually closes). You can display this historic data using a bar graph, Clustered Column type.

Nashville Historic Supply Growth by Scale for the last Five Years
Most growth in Upscale segment

Nashville Historic Supply Growth by Scale for the last Five Years
Most growth in Upscale, Upper Upscale and Upper Midscale segments

Historic Development – recent news
The Data by Property page shows property level detail for each hotel in the area, existing and ones in the Pipeline. The Data by Property page includes an Open Date. You can show a list or table of hotels that have opened recently within the last year or so. This is usually interesting information for the audience. You can sort the hotels on this page by date. (You will need to remove rows that do not contain hotel data.) Then you can calculate (either manually or with an Excel SUMIF function) the numbers of Rooms (or Hotels) opened by month or year (create a year field using CONCATENATE function). This is demonstrated in the “How to Conduct a Development Analysis” training.

3 other hotels opened in early 2015 and 4 hotels opened in 2014
Nashville Hotels – Recent Opens Nashville Market, counts as of July 2016 Hotel Name Rooms Open Date Hilton Garden Inn Nashville Brentwood 126 Mar-16 Woodspring Suites Nashville Southeast 122 Homewood Suites Nashville Franklin 145 Dec-15 Candlewood Suites Smyrna Nashville 87 Oct-15 Best Western Plus Sunrise Inn 93 Sep-15 Holiday Inn Murfreesboro 110 Aug-15 Hilton Garden Inn Nashville Downtown Convention Center 214 Jun-15 3 other hotels opened in early 2015 and 4 hotels opened in 2014

Historic Development – Additional Data
The Changes to Existing Supply page in a Pipeline Report can be used to identify past conversion activity in a market. The Census Database can be used to show additional information regarding historic development for a market. You can determine the number of rooms and hotels opened each month or year back in time. You can also determine the number of rooms and hotels closed each month or year. All of these are demonstrated in the “How to Conduct a Development Analysis” training.

Future Development in the Pipeline – an Overview
The Pipeline Project section on the Summary page provides a snapshot of future Scale development. The columns in this table are organized into the various Pipeline phases (defined in the Appendix). The table shows the number of Hotels and Rooms in each Scale group for each phase. The stacked bar graphs at the top of the Summary page show the total number of rooms, Existing and in each phase by Scale. You can reproduce these bar graphs in your presentation or create a set that just show rooms in the Pipeline.

Nashville Rooms Existing and in Pipeline
by Scale and Phase Most rooms in Upper Upscale now, Upper Midscale in future

Nashville Development, Rooms in Pipeline
by Scale and Phase Most rooms in Pipeline in Upper Midscale Scale, then Upscale, Unaffiliated and Upper Up

Future Development – Additional Data
The Pipeline by Brand Summary page in a Pipeline Report can be used to identify the “hot” brands being developed in an area. The Data by Property page in a Pipeline Report and the Pipeline Database file can be used to identify “hot” submarkets (or other subsets of hotels) in a market. This data can also be used to project future opens by month or year. This can help when it comes to forecasting. You can also compare the Pipeline numbers of the subject market to comparable ones. All of these are demonstrated in the “How to Conduct a Development Analysis” training.

HOST/Profitability Data

A Profitability Analysis
A Profitability Analysis is a comprehensive study of Profit and Loss data for a group of hotels The single source of this data is the STR HOST Report, which is also named the Profitability Report for hotels outside the U.S.. This can be a thorough stand-alone research project. A Market Study can include a certain amount of this profitability information for an overall perspective. For more detail, there is a separate training program on “How to Conduct a Profitability Analysis”

HOST/Profitability Data
The HOST/Profitability reports are a valuable source of additional information related to the subject market. There are three additional types of data in addition to the data that you find on a Trend or Pipeline report: Additional Revenues, beyond Room Revenue Expenses Profit numbers A standard Custom HOST/Profitability Report displays two years of annual data, such as 2015 and You can request back reports to obtain prior years of data. This is valuable because it provides a longer historic trend.

Requesting HOST/Profitability Reports
You can request a HOST/Profitability Report for any industry segment (market) or user-defined group of hotels. Normally separate reports are requested for Full-Service and Limited-Service hotels since the numbers are significantly different. The HOST participation will be less than the STAR (Trend) participation. You can obtain a HOST participation report to check the hotel sample for the time periods that you are analyzing. Participation is also higher for the Luxury and Upper Upscale hotels. Some people analyze just this data as a representation of the market.

Types of Profitability Data
The HOST/Profitability Reports contain a lot of information. The rows are organized into sections such as Revenues, Departmental Expenses, Departmental Profits, Undistributed Expenses. Individual rows are similar to what you see in a P&L/Income Statement. There are columns for Ratio to Sales, Amount per Occupied Room (related to ADR) and Amount per Available Room (related to RevPAR, but you have to divide these numbers by 365). There is one set of these three columns for this year and another for the year before, and there are also variances. These are defined in the Appendix.

General Analysis of Profitability Data
It is easy to do a very general analysis of profitability data. At the highest level, you can display numbers like Room Revenue, Total Revenue, Non-Room Revenue (calculate manually), Total Expenses and/or Gross Operating Profit (GOP). If you obtain multiple HOST reports, you can track these numbers over a longer time period. You can display these numbers for multiple years using a line graph.

Nashville PORs - RoomRev, NonRoomRev, TotRev, Expense, & GOP
Per Occupied Room Numbers, Annual HOST Data, to 2014, Upper Upscale hotels Expenses decreased and Room Revenue increased in 2013 increasing GOP, big increase in all (Room and Non-room) Revenue in 2014

Detailed Analysis of Profitability Data
At a more detailed level, you could separate F&B Revenue from Other Revenue (and compare to Room Revenue) or Departmental versus Undistributed Operating Expenses. Or you could compare individual revenues, expenses or profit numbers and their changes over time. You could compare metrics for Full versus Limited Service properties or hotels at different Scale levels. You can also use the HOST data for the participants to estimate additional revenue and profitability for all hotels in the market. All of these are demonstrated in the “How to Conduct a Profitability Analysis” training.

Forecast Data - future

Forecast Reports Forecast Reports are available for specific U.S. and global markets. Customized Forecast can be generated for additional markets upon request. If a forecast of your market is available, it is valuable information, but sometime may be hard to justify. The analysis of Forecast data will be explored more in the future.

Strong forecast for the future, RevPAR growth fueled by ADR growth
Nashville - Key Performance Indicator Outlook Percent Change vs. Prior Year, 2015 – 2016, as of July, 2015 Outlook 2015 Forecast 2016 Supply 2.7% 2.6% Demand 4.3% 3.3% Occupancy 1.5% 0.7% ADR 8.3% 6.9% RevPAR 10.0% 7.6% Strong forecast for the future, RevPAR growth fueled by ADR growth

Summary

Summary - hints Summarize the major trends related to the market
What were the most important takeaways? What makes the market unique compared to other markets? Emphasize industry takeaways. What should industry professionals be sure not to miss regarding the market? What are important issues or concerns regarding the future for this market? What metrics should be monitored closely? What will be the impact of current Pipeline activity?

Nashville Market - Takeaways
Above average Supply growth in last years, lots of pipeline activity in future, popular place to build a hotel Significant positive impact of new convention center Popular place for group business and weekend getaways Strong recent Demand growth Very strong recent ADR growth contributing to record RevPAR and Revenue growth Big change to group/transient business mix Also significant changes to weekday/weekend metrics

Nashville Market – Looking Ahead
Will the new Convention Center continue to have a positive impact upon Demand growth? How will new hotels that are currently being built or planned be absorbed and what kinds of affects will the increased Supply have? What will be the impact of the new Luxury and Upper Upscale hotels, also the new Upscale and Upper Midscale hotels? Will Nashville continue to outperform comparable markets? Will weekday and group trends continue to make progress relative to weekend and transient numbers? How will various market segments progress in the future?

Let us know how we can help!

Appendix 1 - STR Ad-Hoc Industry Reports and Data Files Related to Typical Research Projects

What are Trend Reports? Trends are the most popular type of ad-hoc report. By default, they display monthly performance data, but they can also include daily and Group/Transient data They contain historical data as far back as 1987 You can select specific hotels or an industry segment. A Participation List shows who submits data in a specific area. You can specify the desired currency There are rules in place to protect hotel’s confidential data

Trend Table of Contents

Tab 6 – Twelve Month Moving Average data
This page displays the twelve month moving average data for each different metric in separate columns. After the values there is an additional column for the percent change. There is a row for each month in the date range. Percent changes start during the second year selected. This is probably the most useful page in the Trend Report. The twelve month data is the best data to analyze since it removes seasonality. The rows allow you to see the metrics change each month. The format makes it very easy to graph metrics (all 12) to see historical trends over time.

Tab 6 - Twelve Month Moving Average with Percent Change

Hint – Twelve Month Moving Average data
The Twelve Month Moving Average (or Running Twelve Month) data is very valuable when it comes to analyzing performance over time. This data removes the seasonal distortion that you see in Monthly data. The data on this page is very easy to work with when it comes to creating graphs in Excel. You can create graphs on Supply, Demand, Revenue, Occupancy, ADR, or RevPAR. You can graph the Actual Values or the Percent Changes. Examples will follow.

Hint – 12MMA data - continued
Note the relationship between the various hotel industry metrics. Compare the actual values to the percent changes to see the interaction. Compare Supply and Demand numbers (actual values and percent changes) to the Occupancy numbers. Compare ADR numbers to Occupancy (or Demand) numbers to see how pricing is typically related to those metrics. Compare ADR and Occupancy numbers to RevPAR numbers to see the interaction and contribution of each metric to the total RevPAR.

Tab 13 – Raw (Monthly) Data
The Raw Data page displays values and percent changes for Occupancy, ADR, RevPAR, Supply, Demand, and Revenue per month for the date range selected. There are also Census Props, Rooms and Percent Participation columns. These are described on the next two slides. This page displays the monthly data in a way that makes it very easy to create graphs on the monthly values or the percent changes.

Hint – Census and Sample Percent numbers
Several of the Trend pages (all of the various Raw Data pages and the Classic page) include a section at the far right of the report titled “Census & Sample %”. This section consists of three columns: Census Props – total number of hotels in the area/group selected Census Rooms – total number of rooms in the hotels above Percent Rooms STAR Participation – the percent based upon number of rooms of the hotels that submit data to STR This data is important to check. A change in the number of Census Props indicates an increase or decrease in the number of hotels, due to Opens or Closes.

Census & Sample Percent numbers - continued
The number of Census Props can change due to Conversions only if you select an industry segment such as Scale. In that case, the Census Props will indicate how many hotels were in that scale on that specific month. A change in the number of Census Rooms indicates an increase or decrease in the number of rooms, due to Adds or Drops. A change in the Percent Participation indicates that a hotel started or stopped submitting data to STR. All of these changes are important to check, since they can affect performance.

Hint – Trends and Consistent Sample
Changes in the Census Props or Rooms, or the Percent Participation can affect the performance numbers on a Trend. This goes back to the issue of “Consistent Sample”. You may want to change your selection criteria, to remove hotels that have opened or closed, as well as ones that have started or stopped submitting data to STR during the time period you are analyzing. It is possible to request a Participation list prior to generating the Trend. Remember to rerun a Trend, you must change the group of hotels by two or more.

Monthly Raw Data

Hint – Monthly data The Monthly data will have much more seasonal distortion compared to the Twelve Month Moving Average data. Graph the monthly data and compare it to the 12MMA data to see the difference. You can create a line graph of a single monthly data metric using just a 12 month graph. So there would just be 12 rows, one for each month. Then create separate lines (columns) for each year. This way you can see if the metric is going up or down from year to year. You can also see the differences for a month or season from one year to the next.

Tab 7 – Day of Week Analysis
The Day of Week Analysis page displays Day of Week numbers (Occupancy, ADR, and RevPAR) per month for the last twelve months on the left side of the page. There are columns for each day and rows for each month and a subtotal for Total Month numbers. On the right side of the page, there are Day of Week numbers by year for the last three years. To perform a Day of Week analysis farther back in time, you can work with the raw daily data. You will need to sort by Year and Day of Week. You will need to add subtotals and then graph the subtotal numbers.

Tab 7 - Day of Week Analysis

Hint – Day of Week data Analyze the Day of Week data to study performance differences on different days of the week. Check the monthly data to see trends during the last year. Or check the annual data for the last three years to see changes further back. Graphing this data makes it easy to see days of the week where Occupancy or ADR has increased or decreased at different rates. Examples will follow.

Tab 8 – Daily Raw Data The Daily Raw Data page displays values and percent changes for Occupancy, ADR, RevPAR, Supply, Demand, and Revenue per day for the date range selected. There are columns for Date, Day (number), Month (number), Year, Day of Week (name), and Week (number). You can sort by Year and Day of Week, or by Year, Month, and Day of Week to conduct Day of Week analyses. You can sort by Week to study weekly performance. In either case, you will need to add subtotals, aggregate the data and calculate Occupancy, ADR, and RevPAR. Then you can graph this data as well.

Hint – Trends and Consistent Sample
Changes in the Census Props or Rooms, or the Percent Participation can affect the performance numbers on a Trend. This goes back to the issue of “Consistent Sample”. You may want to change your selection criteria, to remove hotels that have opened or closed, as well as ones that have started or stopped submitting data to STR during the time period you are analyzing. It is possible to request a Participation list prior to generating the Trend. Remember to rerun a Trend, you must change the group of hotels by two or more.

Tab 8 - Daily Raw Data

Hint – Daily data The daily data is perfect for studying the impact of many different types of events. Remember standard percent changes are based upon comparable days, not date-to-date. Customized percent changes can also be determined related to holidays or regular events that take place each year but at different times. The Raw Data page includes a variety of fields for subtotaling. Options include weekly numbers or day of week by year or month.

Tab 9 – Weekday / Weekend Trend
The Weekday/Weekend Trend page displays separate values and percent changes for Occupancy, ADR, and RevPAR for both weekdays and weekends per month for every month in the date range. There is also a monthly total number for perspective. There are additional columns that display separate Supply, Demand, and Revenue Share numbers for both weekdays and weekends. There are subtotals for Annual and YTD numbers.

Tab 9 - Weekday / Weekend Trend

Hint – Weekday / Weekend data
Analyze the Weekday and Weekend data to look at performance differences for an area or group of hotels. Some people will relate this data to Business versus Leisure travel, for obvious reasons. What are the current Occupancy and ADR differences between weekdays and weekends? You can graph this data over a long period of time (many years) to see historic trends. How does Occupancy and ADR change over time when you compare weekdays and weekends? How is weekday versus weekend performance affected differently in economic cycles and during special events? Examples will follow.

Tab 10 – Quarterly Results
The Quarterly Results page displays separate values and percent changes for Occupancy, ADR, RevPAR, Supply, Demand, and Revenue for each quarter for every year in the date range. Quarters are only displayed when all three months of data are received. There are subtotals for Annual numbers.

Tab 10 - Quarterly Results

Tab 11 – Monthly Segmentation Data
The Monthly Segmentation Data page displays metrics for Segmentation numbers: Transient, Group, and Contract. The section on the left displays values for Occupancy, ADR, and RevPAR. The section on the right displays the corresponding percent changes. There are subtotals for Annual and YTD numbers.

Tab 11 - Monthly Segmentation Data

Tab 12 – Monthly Segmentation Raw Data
The Monthly Segmentation Raw Data page is very similar to the prior page. There is a single column for Supply, since supply for a hotel is not segmented. There are separate Demand and Revenue columns for Transient, Group, and Contract. The section on the right displays the corresponding percent changes. There are also Census Props, Rooms and Percent Participation columns.

Tab 12 - Monthly Segmentation Raw Data

Hint – Segmentation Data
Segmentation can be very valuable to analyze when studying a geographic area or group of hotels. It is especially interesting to compare performance metrics for Group versus Transient business. How does Group Occupancy or ADR compare to Transient over time or during economic cycles? Group Occupancy tends to be hit hard during downturns, due to convention business. Group ADR is slow to change during downturns due to pre-negotiations, but also lags Transient ADR in recoveries for the same reason.

Hint – Segmentation Raw Data
The monthly raw segmentation data can be used to create running 12-month raw segmentation data by inserting columns (Supply, Group Demand, Transient Demand, Total Demand, Group Revenue, Transient Revenue) and including a simple SUM formula to roll up the prior 12 months of data. Then you can calculate Running 12-Month Group ADR (Running 12-month Group Revenue/Running 12-month Group Demand) and Transient ADR. Just simple formulas. You can calculate Percent Changes for Group and Transient ADR and Group and Transient Demand. Just simple formulas again.

Hint – Segmentation Raw Data - continued
Occupancy is not as relevant, since there are three separate types of business: Group, Transient and Contract. What is useful and relevant is to can calculate Business Mix (percentages) to determine the portion that Group and Transient contribute to the Total Demand. Insert more columns and a simple formula for each (Group Demand/Total Demand * 100). Group and Transient Business Mix percentages will not add to 100, since Contract makes up a small portion of business as well. Samples will follow.

15 – Response Page The Response page displays a list of all hotels that are selected for this Trend. The report shows the STR number, name, city, state, zip, affiliation date, open date, and number of rooms. There is a column that shows whether the hotel has had a Room Add or Drop during the date range. There are columns that indicate whether each hotel submitted monthly (empty circle) or daily data (filled in circle) for the last three years. There are totals for properties and rooms.

Tab 15 - Response Page

What is a Pipeline Report?
Pipeline Reports display data on existing hotels, hotels that have recently opened and hotels that are in the “Pipeline”. The Pipeline consists of four phases: In Construction, Final Planning, Planning and Unconfirmed (Rumored). You can select any area of the world. Reports also show changes to existing supply, including opens, closes, room adds/drops, and conversions over time. Reports include property data such as Chain, Market, Rooms, Class and Open/Expected Open Date.

Pipeline Phase Definitions
There are four phases for hotel projects in the development pipeline: In Construction – Vertical construction on the physical building has begun. This does not include construction on any sub- grade structures including, but not limited to, parking garages, underground supports/footers or any other type of sub-grade construction. Final Planning – Confirmed, under contract projects where construction will begin within the next 12 months. Planning – Confirmed, under contract projects where construction will begin in more than 13 months. Unconfirmed – Potential projects that remain unconfirmed at this time.

Pipeline Phase Definitions continued
“Independent” would also include “Unaffiliated” hotels. The term “Under Contract” refers to projects that are in the following three phases: In Construction Final Planning Planning

2 – Supply Summary The Supply Summary shows overview information.
The Historic Supply tables display the number of Hotels and Rooms in the geographic area. The counts are broken down by each of the Scale segments and for each of the last 5 years. The Pipeline Project tables display the number of Projects (hotels) and Rooms that are In Construction or in the three different Planning stages. The graphs show current rooms, both existing and in the Pipeline.

Tab 2 - Supply Summary

Hint – Historic Supply The Historic Supply data is valuable since it shows Rooms Available numbers back in time for each Scale. You can see which Scales have the largest number of rooms in your geographic area. You can also see which Scales have increased or decreased over time. These are important trends that can continue in the future. Graphing this data makes it easier to visualize. See the sample.

Hint – Pipeline Projects
The data in the Pipeline Project section tells you more about future (potential) Supply by Scale. Knowing the number of properties and rooms in construction and in the various planning phases is critical. The stacked bar chart graphs number of rooms and includes Existing Rooms. You can create a second graph to just show rooms in the Pipeline. See sample. There is no guarantee that Pipeline Projects will definitely open. Average attrition rates, including deferrals (on hold) and abandonments (cancellations) are available.

3 – Pipeline by Brand Summary
The Pipeline by Brand Summary shows Hotels and Rooms by Brand and by Scale for the geographic area. Numbers are broken down by Existing Supply (for over a year), Recently Opened (within a year), In Construction, Final Planning, Planning, and Pre-Planning. There are subtotals for each Chain Scale group. Just a subtotal appears for Independent hotels.

Tab 3 - Pipeline by Brand Summary – part 1

Tab 3 - Pipeline by Brand Summary – part 2

Hint – Brand Summary If you are studying a specific geographic area, you can analyze the Existing Supply by Chain. You can list or graph the top Chains by number of rooms or by number of properties. You can also display the top chains that are in the Pipeline for an area, either total or by phase. For smaller areas, you also may want to list the Pipeline projects using data from upcoming pages. Be sure to include detail such as Chain, Location/City, Number of Rooms and Expected Open Date. You could also list hotels that have recently opened.

4 – Supply Changes The Changes to Existing Supply by Brand page shows changes to Supply by number of rooms for two time periods: the last 12 months and the last 60 months (1 year and 5 years). Numbers appear by chain with subtotals by Scale. The first column shows Existing Supply (the number of rooms) at the beginning of the time period. The next section details the Adds including: New Builds – new open Conversions In – affiliation change to different chains Rooms Additions – expansion of existing hotel

More on Supply Changes The second section details the Removed Rooms including: Closed Conversions Out – affiliation change Rooms Removed – room drop, convert rooms to different use There is a column showing the Net Gain or Loss of rooms. The last column shows the Existing Supply (number of rooms) at the end of the time period. This data provides a valuable perspective on the history of an area. It is possible to track hotels that convert out of one chain and into another, by following the number of rooms.

Tab 4 - Changes to Existing Supply by Brand – part 1

Tab 4 - Changes to Existing Supply by Brand – part 2

Hint – Supply Changes The Historic Supply section on the first Summary page shows whether Scales increased or decreased over time. The Changes to Existing Supply page provides valuable detail on these increases or decreases. Did increases happen because of New Opens or Conversions In? Were decreases caused by Closes or Conversions Out? Did Room Adds or Drops have any effect? The Chain information shows which chains are popular in an area. You can see which chains are growing or declining. You can also obtain detail on chain-to-chain conversion activity. (Which chains tend to convert to which others chains?)

5 – Data by Property The Data by Property page lists each hotel (existing, in construction, or closed) and each project (hotel in planning) in the area by Scale Columns show the following property information: Scale Stage (Open, UC, …) STR ID Hotel Name Chain Number of Rooms Address Phone Number Meeting Space (total and largest) Open Date (either Actual or Anticipated) Date Closed For more information, request a Census Database file.

Tab 5 - Data By Property

Hint – Property Data For existing properties, the Chain, Open Date and Number of Rooms fields can be used to identify hotels that have recently opened. For Pipeline projects, the same fields (including Expected Open Date) can be used to specify the number of rooms that will open in future months. You can add the new rooms that will open in the future to the existing rooms to estimate future Supply. This is an important part of forecasting future performance since KPIs will be impacted by the increase to Supply.

6 – Construction Pipeline
The Construction Pipeline page lists each hotel in construction or in planning with detailed project information. Fields include: STR Project ID Stage (Open, UC, …) Projected Opening Date -- Number of Rooms Market and Tract/Submarket -- Location (Address) Hotel Name Chain Owner/Developer Name, Address, Phone, and Fax Architect Name, Address, Phone, and Fax Notes – related to construction or permits

Tab 6 - Construction Pipeline

What is a HOST/Profitability Report?
Different names…similar format…same data. In the U.S. the report is called a HOST (stands for “Hotel Operating Statistics”) Report, while outside the U.S. it is called a Profitability Report. A HOST/Profitability Report displays annual Profit and Loss information, including Revenue, Expense, and Profit accounts (see USALI) for two years including the variance. You can select a group of specific hotels or an industry segment, just like with a Trend Report. You can also request a HOST participation report. There are a variety of metrics displayed when it comes to rows and columns.

Selecting hotels for HOST Reports - hints
Host data will be very different for different types of hotels. You can request separate HOST reports for Full Service hotels and for Select Service hotels. Depending upon participation, you can also request separate reports based upon Scale or Class. For example, you could obtain a report for Full Service Luxury and Upper Upscale hotels and another report for all other Full Service hotels. Or one report for Upscale and above Select Service hotels and another for all other Select Service hotels. You can use the HOST results for participating hotels to model additional revenue and profitability metrics for non- participating hotels in a market.

Introduction to HOST/Profitability Reports
HOST/Profitability Reports list standard P&L accounts: Revenue: Rooms, Food, Beverage, Other F&B, Telecommunications, Other Operated Depts, Rentals and Other Income, Cancellation Fees Departmental Expense: Rooms, F&B, Telecom, Other Operated Depts & Rentals Departmental Profits: same as above Undistributed Operating Expenses: Administrative & General, Marketing, Utility Costs, Property Operation & Maintenance Gross Operating Profit: then Franchise Fees, Management Fees, and Income Before Fixed Charges Selected Fixed Charges: Property Taxes, Insurance, Reserve for Capital Replacement Amount Available for Debt Service

Introduction – More Accounts
Additional P&L-related information appears at the bottom: Supplemental Payroll Analysis: Rooms, Total Food & Beverage, Telecommunications, Other Operated Depts, Administration & General, Marketing, Property Operations & Maintenance Supplemental Food & Beverage Information: Cost of Food Sales, Cost of Beverage Sales, Food & Beverage Payroll, Food & Beverage Other Expenses For detailed definitions of each account, refer to the Uniform Systems of Accounts for the Lodging Industry (11th) Edition

Introduction – Key Metrics
For each of these accounts, the HOST/Profitability Report displays three different metrics: Ratio to Sales (RTS) – the total Revenue or Expense divided by the total amount of Sales (Total Revenue) in most cases. The Ratio to Sales for Departmental Expenses and Profits (Rooms, F&B, Telecom) are based on the respective revenues. Amount Per Available Room (APR) – the total Revenue or Expense divided by the number of rooms in the hotel (or number of keys). Amount Per Occupied Room (APO) – the total Revenue or Expense divided by the total annual number of occupied rooms for the hotel. The actual amounts (annual dollar numbers) are not displayed, but you can calculate them: APR * Number of Rooms.

Tab 2 - HOST Report - Summary page (Revenue)

Tab 2 - HOST Report - Summary page (Undistributed Operating Expenses) Expenses)

Tab 2 - HOST Report - Summary page (Supplemental Payroll Analysis)

Hint – Analyzing HOST data
It can be very insightful to analyze the numbers for various Revenue, Expense, and Profit accounts. The APO (Amount Per Occupied Room) number is similar to ADR. (The Room Revenue APO will equal the annual ADR.) You can divide the APR (Amount Per Available Room) number by 365 to get a result similar to RevPAR. (The Room Revenue APR / 365 will equal RevPAR.) You can apply this logic to derive a TRevPAR (Total Revenue Per Available Room) or a GOPPAR (Gross Operating Profit Per Available Room). This allows you to go beyond the STAR metrics of Occupancy, ADR, and RevPAR.

Analyzing HOST data continued
It can be very interesting to compare HOST data for different types of hotels. You could compare P&L numbers for different types of hotels: Scale or Class hotels - Luxury through Economy Full Service versus Select Service – with or without a restaurant Urban versus non-Urban hotels (location = Suburban, …) Top 10 cities versus Top 11-25, … Convention versus other types: Resort, Boutique Different countries

Hint – Graphing HOST data
It can also be useful to graph the HOST data. If you obtain HOST reports for multiple years, you can view changes over time. Be sure to check participation over multiple years for a consistent sample. You can graph Per Occupied Room or Per Available Room (you can divide the amount by 365) numbers. You can graph Room Revenue, Non-Room Revenue, Total Room Revenue, Total Expense and/or GOP amounts. You can graph Expense amounts such as Marketing Costs, Payroll Costs, or Utility Costs. You can compare Room versus F&B numbers over time.

Sample Issues with HOST data
The HOST sample is smaller than the STAR sample (hotels submitting occupancy, ADR and RevPAR data). Depending upon the sample, you can select various groups of representative hotels such as: Luxury Full Service, Upper Upscale Full Service, Upscale Full Service, Upper Midscale through Economy Full Service And Luxury through Upscale Select Service, Upper Midscale Select Service, Midscale and Economy Select Service You can use the data for the HOST participants to estimate non-participants. When requesting multiple HOST reports back in time, be careful to select a consistent sample.

HOST/Profitability Participation Report

What is a Census Database File?
A Census Database file provides attribute information for hotels. You can select a specific geographic area just like a Pipeline Report. There are nearly 100 fields of hotel information: name, address, and phone, affiliations, ex-affiliations, geographic and non-geographic attributes, physical info such as number of rooms and floors, meeting space, dates such as open date and ex-affiliation dates, type codes, amenities and latitude/longitude. These fields can be helpful to identify unique hotels or recently opened properties in an area.

List of Census Database Fields
STR# (code) Double High (season) Rate Location Property Name Suite (season) Rate Year Affiliated (YYYYMM) Physical Address Ex-Affiliation Physical City Year Built (Open Date) (YYYMM) Type-Convention (Y/N) Physical State Restaurant (Y/N) Type-Conference (Y/N) Physical Postal Code Affiliation Amenity-Ski (Y/N) Physical Country Management Company Name Amenity-Spa (Y/N) Mailing Address Owner Company Name Amenity-Golf (Y/N) Mailing City Operation Type Type-Boutique (Y/N) Mailing State Parent Company Name Type-All Suites (Y/N) Mailing Postal Code Region Amenity-Casino (Y/N) Telephone Number County Type-All Inclusive (Y/N) Fax Number MSA Total Meeting Space Rooms Market Largest Meeting Space Single Low (season) Rate Tract Latitude Single High (season) Rate Scale Longitude Double Low (season) Rate Class STAR Participation (Y/N)

Sample Census Database File

What is a Property and Room Count?
It is possible to obtain property and room counts for groups of hotels. You can select any geographic area just like a Pipeline Report or a Census Database You can also select one or more subtotals, for example: Country by Market and Submarket, Country by Class and Brand, or Continent by Subcontinent and Country. The Count Report displays number of properties and rooms for Census (all hotels) and Sample (ones that submit data to STR).

State of Tennessee by Market and Tract
Census Props Census Rooms Sample Props Sample Rooms Tennessee Knoxville, TN 93 8,937 71 7,568 Gatlinburg/Pigeon Forge, TN 195 17,619 78 8,104 Knoxville Area, TN 63 4,163 39 3,179 Memphis, TN-AR-MS Memphis CBD, TN 36 3,997 21 3,488 Memphis Airport/South, TN 45 4,450 16 1,866 Memphis East, TN 99 9,695 80 8,293 Nashville, TN Nashville CBD, TN 49 9,207 48 9,173 Nashville Airport, TN 68 11,156 54 10,021 Nashville I-65 North, TN 50 3,888 29 2,641 I-24/Murfreesboro, TN 61 5,282 46 4,249 Brentwood/Franklin, TN 4,697 4,535 Nashville Other Areas, TN 62 4,058 41 2,991 Tennessee Area Clarksville, TN 38 2,661 27 2,123 Bristol/Kingsport, TN 59 4,484 37 3,350 Tennessee East Area 147 7,877 70 4,465 Tennessee Central Area 112 6,119 53 3,521 Tennessee West Area 114 5,913 3,030 Chattanooga, TN-GA Chattanooga, TN 4,027 22 2,758 Chattanooga Area, TN 67 5,544 4,990

Hint - Property and Room Counts
Property and Room Counts are very useful since they provide valuable size and structure information about how the hotels are organized in a geographic area. You can answer lots of foundational questions such as: How are the hotels organized geographically in an area? What level hotels are there (Class or Scale)? What are the top chains in an area? How are the hotels organized related to Locations (Urban, Suburban, Airport, …) This kind of data is frequently used to start a Market Study.

What is a Forecast Report?
STR generates monthly Forecasts for Top 25 U.S. markets and 45 WW markets. These reports provide annual, quarterly, and monthly forecast numbers for Supply, Demand, Revenue, Occupancy, ADR, and RevPAR. There is a page that compares recent historic performance to forecasted performance. There is a page that shows Forecast Evolution and the attributing factors. Additional pages display Market Rankings, Macro Forecasts for the U.S., and U.S. Economy information.

Forecast Report – Table of Contents

Recent Performance

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