1. Economic Indicator Study of Hospitality Purchasers Prepared for: The International Society of Hospitality Purchasers Prepared by: The VNU Business Publications Research Center April 2003 www.ishp.org

2. Background and Methodology This study was conducted by the VNU Business Publications Research Center for the ISHP and sponsored by Hospitality Design magazine. The study was designed to gauge the economic conditions in the hospitality industry among ISHP Members. Twenty six (26) members of the ISHP were interviewed in March 2003.

3. Property Segments

4. 62% of their hotel business included restaurants. 99% of their hotel business was in North America.

5. Hotel Projects in the United States

6. Current Hotel Projects

7. Renovation Projects

8. Vendor Origins

9. 62% of respondents reported that the number of resources (vendors) they are working with has INCREASED 31% said the number is DECREASING 8% said the number is UNCHANGED

10. Vendor Lead Times

11. Increases in Lead Times – Specific Categories

12. Vendor Terms of Sale

13. Freight Costs

14. Freight Shipped

15. Project Schedules

16. On average, 28% of current projects are utilizing design firms with which the respondents had not previously worked.

17. On average, one project that started before the economic downturn a year and a half ago was cancelled while two are still on hold.

18. Current budgets compared to those at the end of 2001

19. Product Replacement Cycles

20. Summary  75% of the work is in mid-scale with F&B and above  Mostly located in the Southwest and Northeast  Mostly owner initiated renovations of branded hotels  Almost all the product coming from the US and Canada  We are experiencing longer product lead times  Larger product deposit requirements  Combined with shorter project schedules at a lower budget of items that wear out faster. www.ishp.org