1. Accelerating success. Christopher A. Kraus, MAI Senior Vice President chris.kraus@pkfc.com | 406.582.8189 Colliers PKF Consulting USA chris.kraus@pkfc.com 2010 Convention & Trade Show October 11, 2010

2. I.National Economy and Hotel Market Overview II.Seattle Market Overview and Four Year Forecast III.Spokane Four Year Forecast I.National Economy and Hotel Market Overview II.Seattle Market Overview and Four Year Forecast III.Spokane Four Year Forecast Presentation Outline 2

3. Accuracy Assessment 3 2009 Actual2010 Reforecast YE 2009 Projections YE 2010 Projections as of October 2009Actualas of October 2009as of October 2010 National-18.5%-16.8%-2.7%4.6% Seattle MSA-19.6%-19.8%1.8%1.9% Spokane MSA-8.1%-7.7%-0.5%4.9% Source: Colliers PKF Consulting and Hospitality Research

4. U.S. Lodging Market Overview 4

5. The Great Recession is Over… 5 Recessions since World War II Duration in MonthsPeak-to-Trough % ChangeJobless Rate PeakTrough Recession Peak to Trough Expansion Trough to Peak Real GDP Industrial Production Nonfarm EmploymentLowHigh Chang e Dec-07Aug-092073-3.9%-19.2%-6.1%4.4%10.2%5.9% Mar-01Nov-018120-0.4%-6.3%-2.0%3.8%6.3%2.5% Jul-90Mar-91892-1.3%-4.3%-1.5%5.0%7.8%2.8% Jul-81Nov-821612-2.9%-9.5%-3.1%7.2%10.8%3.6% Jan-80Jul-80658-2.2%-6.2%-1.3%5.6%7.8%2.2% Nov-73Mar-751636-3.1%-14.8%-2.7%4.6%9.0%4.4% Dec-69Nov-7011106-1.0%-5.8%-1.4%3.4%6.1%2.7% Apr-60Feb-611024-1.3%-6.2%-2.3%4.8%7.1%2.3% Aug-57Apr-58839-3.8%-12.7%-4.4%3.7%7.5%3.8% Jul-53May-541045-2.7%-9.0%-3.3%2.5%6.1%3.6% Nov-48Oct-491137-1.7%-8.6%-5.1%3.4%7.9%4.5% Average1057-2.0%-8.3%-2.7%4.4%7.6%3.2% Sources: NBER, BEA, FRB, BLS, Moody’s Economy.com

6. U.S. Total Employment Levels 6 8.3 Million Jobs Lost – 5 Years From Peak-to-Peak We’re Here 12 Quarters 17 Quarters 20 Quarters

7. Economic Assumptions Driving Economic Assumptions Driving Our Forecasts: Better Quicker Payroll Employment Real Personal Income Real GDPCPI (Inflation) 2009 -4.3% -1.9%-2.0%-2.6%-2.4%-0.3% 2010 -0.5%-0.7%0.8%0.6%2.7%2.3%1.6%1.5% 2011 1.0%0.1%2.6%2.4%3.1%1.4%1.6%0.8% 2012 2.5%1.9%4.8%3.6%5.0%3.8%2.5%2.8% 2013 3.3%3.2%4.7%3.8%4.2%4.5%2.9%3.1% Source: Moody’s Economy.com, September 2010 (July 2010) 7 Updated 9/17/2010 - aw

8. The Hotel Market Cycle 8 Rapid Development Lodging Decline, Leads Other Sectors Development Picks Up Long Run Occupancy Equilibrium ADR Rapid Development Occupancy Declines, ADR Follows Development at Minimum Levels Lodging Decline, Leads Other Sectors Occupancy Recovers ADR and Margins Recover Development Picks Up Development Slows Lodging Recovers, Lags Other Sectors Long Run Occupancy Rapid Development Equilibrium ADR U.S. is Here 2011-2012 A Year Ago Moving Past the Trough 2013-2014

9. Current Forecast – October 2010 - a Quicker Turnaround 9 ?

10. Long Term Average 20062007200820092010F2011F2012F Supply2.2% 0.2%1.3%2.5%3.1%2.0%1.1%.08% Demand 1.5% 0.5%0.8%-2.1%-5.9%7.3%3.2%4.9% Occupancy 62.2% 63.1%62.8%60.0%54.7%57.5%58.7%61.0% ADR 2.9% 7.6%6.4%2.8%-8.8%-0.6%3.8%6.3% RevPAR2.3% 7.9%5.9%-1.9%-16.8%4.6%5.9%10.6% National Horizon October 2010 Update A Quicker Turnaround? Record Decline Record Increase Source: Colliers PKF Hospitality Research – September-November 2010 Hotel Horizons ® Report, Smith Travel Research 10

11. Recovery Will Be Strong Through 2013 11 +64.6% - 1943 -22.4% - 1938 -19.4% - 2001 -35.4% - 2009 +10.8% - 2011F +17.9% - 2012F +21.7% - 2013F Note: * Before deductions for capital reserve, rent, interest, income taxes, depreciation, and amortization. Source: Colliers PKF-HR, Trends® in the Hotel Industry sample.

12. Seattle Lodging Market Overview 12

13. Seattle Lodging Market Overview Long Term Average 20022003200420052006200720082009 Supply 3.4% 3.5%1.7%1.8%0.3%2.9%2.5%2.7% 3.1% Demand 3.1% 0.2%3.8%5.1%6.2%6.3%3.2%-2.7% -6.9% Occupancy 71.1% 61.8%63.0%65.1%68.9%71.2%71.7%68.0% 61.4% ADR 3.3% -3.5%-1.5%2.6%6.1%11.5%7.5%3.5% -11.1% RevPAR 3.1% -6.6%0.5%5.9%12.3%15.2%8.3%-1.9% -19.8% Source: Colliers PKF Hospitality Research – September-November 2010 Hotel Horizons ® Report, Smith Travel Research 13

14. Factors Impacting Lodging Demand LOCAL ECONOMY WASHINGTON STATE CONVENTION AND TRADE CENTER SEA-TAC AIRPORT LODGING SUPPLY 14

15. HistoricalProjection Employment levels return to 2008 levels in 2012. Employment Levels and Unemployment Rate 15 Historical Projection

16. Downtown Seattle Lodging Supply Change 16 PropertyLocationNew RoomsStatusDate Open Sheraton - Union Street Tower6th & Union415OpenJune 2007 Arctic Club3rd & Cherry120OpenJuly 2008 Four Seasons1st & Union147OpenNovember 2008 The Hyatt at Olive 88th & Olive346OpenJanuary 2009 Maxwell Hotel3rd & Roy140OpenMarch 2010 Hyatt Place6th & Denny158OpenJune 2010 Courtyard by Marriott2nd & Cherry262OpenJune 2010 Recently Opened 1,588 Hampton Inn & Suites7th & Jackson137ProposedTBD 1st & Stewart +/-100ProposedTBD Hummingbird Development5th & Virginia185ProposedTBD Candela Hotel2nd & Pike150ProposedTBD Greyhound Property8th & Stewart+/- 1,200ProposedTBD The "1" Hotel2nd & Pine120ProposedTBD Hotel Ava8th & Pine190ProposedTBD Proposed & On Hold 2,082

17. Seattle Convention & Visitors Bureau Convention Calendar Outlook 17 2007 was the strongest convention year on record Total Number of Booked Room Nights 2005453,839- 2006485,7757% 2007550,18413% 2008514,286-7% 2009454,717-12% 2010400,182-12% 2011376,494-6% 2012255,579-32% 2013217,541-15% 2014139,237-36% 2015125,129-10.1% 201655,745-55.4%

18. Sea-Tac Airport Passenger Statistics 18 Record numbers in 2008 – nearly 32.2 million total passengers First eight months of 2010 show decline of 0.2% Passenger count decreased by only 3.0% in 2009

19. How Will This Impact Seattle? 19

20. Seattle Four Year Forecast All Hotels 20 Long Term Average200520062007 200820092010P2011P2012P2013P Supply3.4% 0.3%2.9%2.5%2.7% 3.1%2.4%0.7%0.4%1.0% Demand3.1% 6.2%6.3%3.2%-2.7% -6.9%7.8%4.7%3.6%2.9% Occupancy71.1% 68.9%71.2%71.7%68.0% 61.4%64.6%67.2%69.3%70.6% ADR3.3% 6.1%11.5%7.5%3.5% -11.1%-3.2%5.0%5.4%5.9% RevPAR3.1% 12.3%15.2%8.3%-1.9% -19.8%1.9%9.1%8.8%7.9% Source: Colliers PKF Hospitality Research – September-November 2010 Hotel Horizons ® Report, Smith Travel Research Sample represents greater Seattle area consisting of more than 40,000 hotel rooms

21. How About Spokane? 21

22. Spokane Four Year Forecast Spokane Four Year Forecast All Hotels 22 2004200520062007 200820092010P2011P2012P2013P Supply 0.4% -1.9%5.3%0.0% 1.3%5.0%0.5%1.0% Demand 8.6% 0.8%0.3%7.3%-2.8% -4.5%8.7%3.3%2.6%2.0% Occupancy 59.3% 59.6 % 60.9 % 62.0 % 60.3 % 56.9%58.9%60.5%61.5%62.1% ADR 4.1% 4.4%9.2%8.8%4.4% -2.1%1.3%3.5%4.5%3.0% RevPAR 12.7% 4.8% 11.6 % 10.8 % 1.5% -7.7%4.9%6.4%6.2%4.0% Note: Sample represents Spokane County, consisting of more than 7,000 hotel rooms

23. Questions?