3Q-2021 Market Intelligence Reports Release Presentation - Better Lodging Analytics For Better Business Decisions

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3Q-2021 Market Intelligence Reports Release Presentation - Better Lodging Analytics For Better Business Decisions
3Q-2021 Market Intelligence
             Reports Release
              Presentation

Better Lodging Analytics For Better Business Decisions
3Q-2021 Market Intelligence Reports Release Presentation - Better Lodging Analytics For Better Business Decisions
1. Our Approach to Market Intelligence
2. U.S. Market Review
3. This Recovery Will Be Different
4. U.S. Outlook
5. Market Highlights
6. Q&A
3Q-2021 Market Intelligence Reports Release Presentation - Better Lodging Analytics For Better Business Decisions
Our Approach
3Q-2021 Market Intelligence Reports Release Presentation - Better Lodging Analytics For Better Business Decisions
The LARC Approach

                          Everything To Analyze a Market in One Place
•   Historical Operating Results                 Forecasts for the following key industry metrics:
                                                 On a Quarterly Basis
•   Detailed Economic Summary                         •    Supply
•   Citywide Pacing Data                              •    Demand
                                                      •    Occupancy
•   Air Traffic Data                                  •    Average Daily Rate
•   Office Market                                     •    RevPAR
                                                      •    Wages
•   Supply Pipeline                                   •    Hotel EBITDA and Margins
•   Home Sharing                                 On an Annual Basis
                                                      •    Property Taxes
•   Recent Transactions                               •    Cap Rates
•   Key Capital Projects (Public and Private)         •    Hotel Values
3Q-2021 Market Intelligence Reports Release Presentation - Better Lodging Analytics For Better Business Decisions
LARC’s Core Values

     Transparency                     Market-Based                          Realism

LARC believes its forecast       LARC recognizes that each         LARC’s baseline forecasts
accuracy      should        be   forecast/ project completed       represent the most likely
transparent and offer a          should be constructed with        outcomes, grounded in the
means for clients to alter       the specific factors that drive   current market environment
inputs to key drivers, should    that individual market in         and realistic outlooks for key
they      have       differing   mind, yielding a unique           macro drivers.
assumptions.                     analytical model that results
                                 in highly accurate findings
                                 and conclusions.
3Q-2021 Market Intelligence Reports Release Presentation - Better Lodging Analytics For Better Business Decisions
Forecast Methodology

    Multi-Variable Linear Regression                        No Subjective Adjustments
•   We find the industry and macro-economic           •   We incorporate special events like the Super
    factors that drive lodging fundamentals in            Bowl into our models
    each market we analyze                            •   Taking the time to build market specific models
     o While there is overlap among the markets, no       creates heightened forecasting accuracy
       two markets have the same forecast model
     o We include leading indicators as well as       •   We don’t allow the psychology of the moment to
       concurrent indicators                              alter our forecasts by applying subjective
                                                          adjustments.
•   We build as many factors as necessary into
    our models (usually between 3 and 7) to           •   Subjectively adjusting the results eliminates the
    build a model that has impeccable back                advantage of using data analytics
    testing strength going back to 2000
     o Our models account for past downturns
3Q-2021 Market Intelligence Reports Release Presentation - Better Lodging Analytics For Better Business Decisions
Only the Best Data Sources

                               Better Data In = Better Data Out
• We know that regression forecasting is based      Key Data Providers
  on data and specifically forecasts for key        •   Historical Operating Results- STR
  industry drivers that come from platforms other
  than us.                                          •   Detailed Economic Summary- Moody’s Analytics

• We use the best data providers we can find to     •   Citywide Pacing Data- Local CVBs
  make sure that our outputs are the best           •   Office Market- Moody’s Analytics
  possible.                                         •   Supply Pipeline- BuildCentral
                                                    •   Home Sharing- AirDNA
                                                    •   Historical Cap Rates and Transactions – Real
                                                        Capital Analytics, LW Hospitality Advisors
3Q-2021 Market Intelligence Reports Release Presentation - Better Lodging Analytics For Better Business Decisions
U.S. Market Review
3Q-2021 Market Intelligence Reports Release Presentation - Better Lodging Analytics For Better Business Decisions
Monthly 2021 RevPAR Growth From 2019

         Recovery Progressing                               Monthly RevPAR Change vs. 2019
•   U.S RevPAR has been on a steady          20%
    recovery since the start of the year
                                                0%
     • January: -48%
                                             -20%
     • April: -29%
     • July: +0.2%                           -40%
                                                                                                                            U.S.
•   STR’s Top-25 markets are down            -60%                                                                           Top 25
    more, but recovering at a similar pace                                                                                  All Other
                                             -80%
•   Smaller markets turned positive vs.

                                                                                                                            June
                                                                     January

                                                                                                                      May

                                                                                                                                    July
                                                                                                      March
                                                                                           February

                                                                                                              April
    2019 in June
                                             Source: Lodging Analytics Research & Consulting, STR
4%
                                                                                               • Market
                                                                                                                                     from 2019
                                                                                                                                     through July
                                                                                                                                     down 25.2%

                                                                                                 Extreme YTD
                                                                                                 Divergence is

                                                                   is down 71%
                                                                 • Norfolk is up

                                                                 • San Francisco
                                                                                                                                                                                                 U.S. Headlines
                                                                                                                                   • 2021 U.S. RevPAR
                                                                                                                                                            10%
                                                                                                                                                       0%

                                                                                               -80%
                                                                                                      -70%
                                                                                                             -60%
                                                                                                                    -50%
                                                                                                                           -40%
                                                                                                                                  -30%
                                                                                                                                         -20%
                                                                                                                                                -10%
                                                                Norfolk/Virginia Beach, VA
                                                                                 Miami, FL
                                                                                Tampa, FL
                                                                            Charleston, SC
                                                                             Memphis, TN
                                                                               Omaha, NE
                                                                           San Antonio, TX
                                                                               Dayton, OH

Source: Lodging Analytics Research & Consulting, STR, LVCVA
                                                                         Salt Lake City, UT
                                                                               Phoenix, AZ
                                                                           Des Moines, IA
                                                                           Saint Louis, MO
                                                                            Cleveland, OH
                                                                          Kansas City, MO
                                                                              Houston, TX
                                                                           Indianapolis, IN
                                                                               Detroit, MI
                                                                            San Diego, CA
                                                                              Atlanta, GA
                                                                                Dallas, TX
                                                                            Pittsburgh, PA
                                                                            Ann Arbor, MI
                                                                              Orlando, FL
                                                                                                                                                                                                                                 An Inconsistent Start to the Recovery

                                                                           Los Angeles, CA
                                                                                 Austin, TX
                                                                        Orange County, CA
                                                                            Columbus, OH
                                                                                                                                                                  YTD-July RevPAR vs. YTD 2019

                                                                             Nashville, TN
                                                                               Raleigh, NC
                                                                                 Las Vegas
                                                                              Louisville, KY
                                                                          Philadelphia, PA
                                                                               Denver, CO
                                                                                                                                                                                                 YTD-July 2021 RevPAR vs. 2019

                                                                              Portland, OR
                                                                           Oahu Island, HI
                                                                               Chicago, IL
                                                                         Minneapolis, MN
                                                                         New Orleans, LA
                                                                              Seattle, WA
                                                                            New York, NY
                                                                          Washington, DC
                                                                              Boston, MA
                                                                              San Jose, CA
                                                              San Francisco/San Mateo, CA
July

                                                                   36%
                                                                                                                  vs. 2019 in July
                                                                                                                                                    • U.S. RevPAR up

                                                                                                                • 11 of LARC’s 44
                                                                                                                                                      0.2% vs. 2019 in

                                                                                                                  markets positive

                                                                Remains Extreme

                                                                 • San Francisco
                                                                                                                                                                                                       U.S. Headlines

                                                                 • Miami was up
                                                              • Market Divergence

                                                                   was down 50%
                                                                                                                                              10%
                                                                                                                                                    20%
                                                                                                                                                          30%
                                                                                                                                                                40%

                                                                                                                                         0%

                                                                                               -60%
                                                                                                      -50%
                                                                                                             -40%
                                                                                                                    -30%
                                                                                                                           -20%
                                                                                                                                  -10%
                                                                                 Miami, FL
                                                                                Tampa, FL
                                                                Norfolk/Virginia Beach, VA
                                                                            Charleston, SC
                                                                               Phoenix, AZ
                                                                              Orlando, FL
                                                                           San Antonio, TX
                                                                               Omaha, NE

Source: Lodging Analytics Research & Consulting, STR, LVCVA
                                                                                 Las Vegas
                                                                             Nashville, TN
                                                                             Memphis, TN
                                                                              Atlanta, GA
                                                                            San Diego, CA
                                                                          Kansas City, MO
                                                                        Orange County, CA
                                                                                 Austin, TX
                                                                         Salt Lake City, UT
                                                                           Oahu Island, HI
                                                                           Des Moines, IA
                                                                              Houston, TX
                                                                               Detroit, MI
                                                                           Saint Louis, MO
                                                                           Indianapolis, IN
                                                                                                                                                                                                                                   An Inconsistent Start to the Recovery

                                                                           Los Angeles, CA
                                                                               Dayton, OH
                                                                              Louisville, KY
                                                                         New Orleans, LA
                                                                                                                                                                      July 2021 RevPAR vs. July 2019

                                                                                Dallas, TX
                                                                            Pittsburgh, PA
                                                                            Cleveland, OH
                                                                            Ann Arbor, MI
                                                                                                                                                                                                       July 2021 RevPAR vs. 2019

                                                                               Denver, CO
                                                                          Philadelphia, PA
                                                                               Raleigh, NC
                                                                            Columbus, OH
                                                                               Chicago, IL
                                                                              Portland, OR
                                                                            New York, NY
                                                                              Seattle, WA
                                                                         Minneapolis, MN
                                                                          Washington, DC
                                                                              Boston, MA
                                                                              San Jose, CA
                                                              San Francisco/San Mateo, CA
TSA Throughput

      Air Traffic Recovery Stalled
                                                               TSA Throughput Growth vs. 2019
                                                                 On 14-Day Moving Average
•   Air traffic volumes troughed at year-         0%
    over-year declines of 96% in mid-April     -20%
    2020
                                               -40%
•   From September 2020 through June           -60%
    2021 there was steady improvement
                                               -80%
•   However, since the start of July
                                             -100%
    throughput has stabilized at levels
    about 20% below 2019                     -120%

                                                                                                                                              10/14/2020
                                                                                                                                                           11/14/2020
                                                                                                                                                                        12/14/2020
                                                          3/14/2020
                                                                      4/14/2020
                                                                                  5/14/2020
                                                                                              6/14/2020
                                                                                                          7/14/2020
                                                                                                                      8/14/2020
                                                                                                                                  9/14/2020

                                                                                                                                                                                     1/14/2021
                                                                                                                                                                                                 2/14/2021
                                                                                                                                                                                                             3/14/2021
                                                                                                                                                                                                                         4/14/2021
                                                                                                                                                                                                                                     5/14/2021
                                                                                                                                                                                                                                                 6/14/2021
                                                                                                                                                                                                                                                             7/14/2021
                                                                                                                                                                                                                                                                         8/14/2021
                                             Source: Lodging Analytics Research & Consulting, TSA
Vaccinations Driving Increased Travel

     Vaccinations Driving Air Traffic
                                                 TSA Throughput Relative to 2019 vs. U.S.
                                                           Vaccination Totals
•   As of September 4, approximately 176               0%                                                                                                                                                                                                             200
    million U.S. citizens had been fully

                                                                                                                                                                                                                                                                            Millions
                                                                                                                                                                                                                                                                      180
    vaccinated                                    -10%
                                                                                                                                                                                                                                                                      160
•   Data From January 19 to September 4           -20%                                                                                                                                                                                                                140
    shows that vaccinations are driving an        -30%                                                                                                                                                                                                                120
    increase in air traffic                                                                                                                                                                                                                                           100
     •   97.1% correlation                        -40%                                                                                                                                                                                                                80
     •   94.4% R-squared                          -50%                                                                                                                                                                                                                60
                                                                                                                                                                                      Air Traffic vs. 2019                                                            40
•   However, moving forward vaccinations          -60%
                                                                                                                                                                                                                                                                      20
    will slow and the recovery will be reliant                                                                                                                                        U.S. Vaccination Total
    on the return of corporate and group          -70%                                                                                                                                                                                                                0

                                                                           2/2/2021

                                                                                                  3/2/2021

                                                                                                                                                                                     6/8/2021

                                                                                                                                                                                                            7/6/2021

                                                                                                                                                                                                                                   8/3/2021
    demand

                                                               1/19/2021

                                                                                      2/16/2021

                                                                                                             3/16/2021
                                                                                                                         3/30/2021
                                                                                                                                     4/13/2021
                                                                                                                                                 4/27/2021
                                                                                                                                                             5/11/2021
                                                                                                                                                                         5/25/2021

                                                                                                                                                                                                6/22/2021

                                                                                                                                                                                                                       7/20/2021

                                                                                                                                                                                                                                              8/17/2021
                                                                                                                                                                                                                                                          8/31/2021
•   Less than 30% of the global population
    is fully vaccinated
                                                 Source: Lodging Analytics Research & Consulting, TSA, CDC
Hotel Booking Volumes
         Volumes Beginning to                                  Hotel Booking Volumes as % of 2019
              Accelerate                                                     Levels
•   U.S. hotel booking volumes have started to
    improve
     •   As of 2/1, 54.6% of 2019 booking volumes
         were completed
     •   As of 3/1, 62.8%
     •   As of 5/27, 88.4%
     •   As of 7/1, 82.0%
     •   As of 8/13, 74.2%
     •   As of 9/5, 82.4%
•   The Delta Variant clearly caused a
    deceleration in the bookings recovery from                               Booking Window is Very Short
    late July through Mid-August, but booking
    volumes have recovered that lost ground
•   Booking windows remain extremely short

                                                    Source: Siteminder.com
Supply- Hotel Closures
                                                                 Peak Rooms Closures
    Peak Room Closure Highlights
                                                           as a % of Existing Market Inventory
•    The U.S. closure peak occurred in April   60%
     2020 at almost 800,000 rooms,
                                               50%
     equating to 14.3% of the rooms
     inventory                                 40%

•    Markets with the highest level of peak    30%
     closures have the following attributes:
                                               20%
      •   Heavy concentration of union labor
                                               10%
      •   Large resorts
      •   International destination              0%

                                                                  Anaheim
                                                             San Francisco
                                                                   Orlando

                                                                 San Diego

                                                                  Nashville
                                                                 New York

                                                                    Norfolk
                                                                   St. Louis
                                                              Philadelphia

                                                                    Denver
                                                                    Boston

                                                           Washington D.C.
                                                                  Honolulu

                                                                   Chicago
                                                                    Seattle
                                                                  Houston

                                                                   Phoenix

                                                              Minneapolis
                                                                     Miami

                                                                    Tampa
                                                                    Atlanta

                                                                    Detroit
                                                               Los Angeles

                                                                      Dallas
                                                              New Orleans
      •   Theme parks as a large demand
          driver

                                               Source: Lodging Analytics Research & Consulting, BuildCentral and STR
Supply- Closures As of July 2021

    July Room Closure Highlights                                          July Room Closures
                                                                      as a % of Existing Inventory
•   As of July 2021, only about 20,000     10%

    rooms remained closed across the                      7.8%
    U.S., equating to 0.4% of the rooms
    inventory
•   New York now accounts for about half                                  3.7%
    of all closures, though we estimate                                                  2.3%
    that only about 5,500 rooms across                                                                   1.6%      1.3%
                                                                                                                          0.9%
    the New York market will be                                                                                                  0.4%   0.3%   0.3%   0.2%
                                             0%
    permanently closed

                                           Source: Lodging Analytics Research & Consulting, BuildCentral and STR
Home Sharing- Leisure Focused and Supply Driven
      Hotel-Comparable Home Sharing Revenue and YoY                                                                                Hotel-Comparable Home Sharing Available Room                                                                                                                   Hotel-Comparable Home Sharing ADR and YoY
             Growth on a Rolling 4-Quarter Basis                                                                                  Nights and YoY Growth on a Rolling 4-Quarter Basis                                                                                                                   Growth on a Rolling 4-Quarter Basis
           $2,500                                                                                                        120%               20                                                                                                                              120%             $180                                                         8%
Millions

                                                                                                                                 Millions
                                                                                                                         100%               18                                                                                                                              100%             $170                                                         7%
           $2,000                                                                                                                           16                                                                                                                                               $160                                                         6%
                                                                                                                         80%                                                                                                                                                80%                                                                           5%
                                                                                                                                            14                                                                                                                                               $150
           $1,500                                                                                                        60%                12                                                                                                                              60%              $140                                                         4%
                                                                                                                         40%                10                                                                                                                              40%                                                                           3%
                                                                                                                                                                                                                                                                                             $130
                                                                                                                                                                                                                                                                                                                                                          2%
           $1,000                                                                                                        20%                 8                                                                                                                              20%              $120                                                         1%
                                                                                                                                             6                                                                                                                                               $110                                                         0%
                                                                                                                         0%                                                                                                                                                 0%
            $500                                                                                                                             4                                                                                                                                               $100                                                         -1%
                                                                                                                         -20%                2                                                                                                                              -20%              $90                                                         -2%
              $0                                                                                                         -40%                0                                                                                                                              -40%              $80                                                         -3%

                                                                                                                                                     2016-3Q
                                                                                                                                                     2016-4Q
                                                                                                                                                     2017-1Q
                                                                                                                                                     2017-2Q
                                                                                                                                                     2017-3Q
                                                                                                                                                     2017-4Q
                                                                                                                                                     2018-1Q
                                                                                                                                                     2018-2Q
                                                                                                                                                     2018-3Q
                                                                                                                                                     2018-4Q
                                                                                                                                                     2019-1Q
                                                                                                                                                     2019-2Q
                                                                                                                                                     2019-3Q
                                                                                                                                                     2019-4Q
                                                                                                                                                     2020-1Q
                                                                                                                                                     2020-2Q
                                                                                                                                                     2020-3Q
                                                                                                                                                     2020-4Q
                                                                                                                                                     2021-1Q
                                                                                                                                                     2021-2Q

                                                                                                                                                                                                                                                                                                        2016-3Q
                                                                                                                                                                                                                                                                                                        2016-4Q
                                                                                                                                                                                                                                                                                                        2017-1Q
                                                                                                                                                                                                                                                                                                        2017-2Q
                                                                                                                                                                                                                                                                                                        2017-3Q
                                                                                                                                                                                                                                                                                                        2017-4Q
                                                                                                                                                                                                                                                                                                        2018-1Q
                                                                                                                                                                                                                                                                                                        2018-2Q
                                                                                                                                                                                                                                                                                                        2018-3Q
                                                                                                                                                                                                                                                                                                        2018-4Q
                                                                                                                                                                                                                                                                                                        2019-1Q
                                                                                                                                                                                                                                                                                                        2019-2Q
                                                                                                                                                                                                                                                                                                        2019-3Q
                                                                                                                                                                                                                                                                                                        2019-4Q
                                                                                                                                                                                                                                                                                                        2020-1Q
                                                                                                                                                                                                                                                                                                        2020-2Q
                                                                                                                                                                                                                                                                                                        2020-3Q
                                                                                                                                                                                                                                                                                                        2020-4Q
                                                                                                                                                                                                                                                                                                        2021-1Q
                                                                                                                                                                                                                                                                                                        2021-2Q
                     2016-3Q

                               2017-1Q

                                         2017-3Q

                                                   2018-1Q

                                                             2018-3Q

                                                                       2019-1Q

                                                                                 2019-3Q

                                                                                           2020-1Q

                                                                                                     2020-3Q

                                                                                                               2021-1Q

    Source: AirDNA and Lodging Analytics Research & Consulting                                                                  Source: AirDNA and Lodging Analytics Research & Consulting                                                                                                   Source: AirDNA and Lodging Analytics Research & Consulting

                                                                                                                                    Hotel-Comparable Home Sharing Segment Share of
                                                                                                                                              Accommodations Revenue
                                                                                                                                   8%
                                                                                                                                   7%
                                                                                                                                   6%
                                                                                                                                   5%
                                                                                                                                   4%
                                                                                                                                   3%
                                                                                                                                   2%
                                                                                                                                   1%
                                                                                                                                   0%
                                                                                                                                                 2014-4Q
                                                                                                                                                           2015-2Q
                                                                                                                                                                     2015-4Q
                                                                                                                                                                               2016-2Q
                                                                                                                                                                                         2016-4Q
                                                                                                                                                                                                   2017-2Q
                                                                                                                                                                                                             2017-4Q
                                                                                                                                                                                                                       2018-2Q
                                                                                                                                                                                                                                 2018-4Q
                                                                                                                                                                                                                                           2019-2Q
                                                                                                                                                                                                                                                     2019-4Q
                                                                                                                                                                                                                                                               2020-2Q
                                                                                                                                                                                                                                                                         2020-4Q
                                                                                                                                                                                                                                                                                   2021-2Q
                                                                                                                                   Source: AirDNA and Lodging Analytics Research & Consulting
This Recovery Will be
Different
This Cycle is Unlike Any Other- RevPAR

    RevPAR Recovery Timeline                       RevPAR Recovery in Past Cycles (TTM)
                                               110
•   This cycle’s RevPAR decline is
    deeper and steeper than any                100
    experienced prior                          90

•   Following the Great Financial Crisis, it   80
    took 59 months for trailing-12-month
                                               70
    RevPAR to recover to the prior peak
                                                                                                                                                                                                                Current Downturn
    level                                      60
                                                                                                                                                                                                                Great Financial Crisis
                                               50
•   Following 9/11, it took 52 months                                                                                                                                                                           9/11

                                               40

                                                      Month 0
                                                                Month 3
                                                                          Month 6
                                                                                    Month 9
                                                                                              Month 12
                                                                                                         Month 15
                                                                                                                    Month 18
                                                                                                                               Month 21
                                                                                                                                          Month 24
                                                                                                                                                     Month 27
                                                                                                                                                                Month 30
                                                                                                                                                                           Month 33
                                                                                                                                                                                      Month 36
                                                                                                                                                                                                 Month 39
                                                                                                                                                                                                            Month 42
                                                                                                                                                                                                                       Month 45
                                                                                                                                                                                                                                  Month 48
                                                                                                                                                                                                                                             Month 51
                                                                                                                                                                                                                                                        Month 54
                                                                                                                                                                                                                                                                   Month 57
                                               Source: Lodging Analytics Research & Consulting, STR
This Cycle is Unlike Any Other- Occupancy
                                                           Occupancy Recovery in Past Cycles
    Occupancy Recovery Timeline
                                                                        (TTM)
                                                110
•    This cycle’s Occupancy decline is
     deeper and steeper than any                100
     experienced prior
                                                90
•    Following the Great Financial Crisis, it
     took 81 months for trailing-12-month       80

     Occupancy to recover to the prior          70                                                                                      Current Downturn
     peak level                                                                                                                         Great Financial Crisis
                                                60
•    Following 9/11, it took 65 months                                                                                                  9/11

                                                50

                                                       Month 0

                                                                               Month 12

                                                                                                       Month 24

                                                                                                                  Month 36

                                                                                                                             Month 48

                                                                                                                                          Month 60

                                                                                                                                                       Month 72
                                                Source: Lodging Analytics Research & Consulting, STR
This Cycle is Unlike Any Other- ADR

      ADR Recovery Timeline                               ADR Recovery in Past Cycles (TTM)
                                               110
•   This cycle’s ADR decline is deeper
    and steeper than any experienced           100
    prior
                                               90
•   Following the Great Financial Crisis, it
    took 52 months for trailing-12-month       80

    ADR to recover to the prior peak level     70                                                     Current Downturn
•   Following 9/11, it took 45 months          60
                                                                                                      Great Financial Crisis
                                                                                                      9/11

                                               50

                                                       Month 0
                                                       Month 2
                                                       Month 4
                                                       Month 6
                                                       Month 8
                                                      Month 10
                                                      Month 12
                                                      Month 14
                                                      Month 16
                                                      Month 18
                                                      Month 20
                                                      Month 22
                                                      Month 24
                                                      Month 26
                                                      Month 28
                                                      Month 30
                                                      Month 32
                                                      Month 34
                                                      Month 36
                                                      Month 38
                                                      Month 40
                                                      Month 42
                                                      Month 44
                                                      Month 46
                                                      Month 48
                                                      Month 50
                                                      Month 52
                                               Source: Lodging Analytics Research & Consulting, STR
This Cycle is Unlike Any Other- Hotel Values
                                                          Hotel Value Recovery in Past Cycles
    Hotel Value Recovery Timeline
                                                                (Values Indexed to 2019)
•    Following the Great Financial Crisis,      110
     Hotel Values dropped 27% from the
     2007 peak to the 2009 trough               100
•    Following the Great Financial Crisis,
     Hotel Values did not recover to the 2007       90
     peak until 2015
                                                    80
•    By 2018, values were 18% above the
     prior 2007 peak                                70
•    Values began declining in 2019, in
     advance of the pandemic                        60

                                                                  2020 E
                                                                   2005
                                                                   2006
                                                                   2007
                                                                   2008
                                                                   2009
                                                                   2010
                                                                   2011
                                                                   2012
                                                                   2013
                                                                   2014
                                                                   2015
                                                                   2016
                                                                   2017
                                                                   2018
                                                                   2019
•    We estimate that in a fully transparent
     environment, 2020 values would have
     fallen another 24%                         Source: Lodging Analytics Research & Consulting, Real Capital Analytics
Convention Demand Could Recover Quickly

    Recovery Will Be Faster Than                                  U.S. Convention Center Bookings as of
            Past Cycles                                                         June 2021
•   We have aggregated definite room nights for over 30             120                                           Index                                 10%
    of the largest convention centers across the United
                                                                                                                  % Chg vs. 2019                        0%
    States                                                          100
                                                                                                                                                        -10%
•   2021 is pacing up 21% from 2020 but still 58% below               80
    that of 2019 as cancellations have continued to                                                                                                     -20%
    materialize. Regardless, the majority of 2021 softness            60                                                                                -30%
    was in the front half of the year, so if cancellations
                                                                                                                                                        -40%
    don’t accelerate (something we believe is unlikely) the           40
    recovery will begin in 4Q-2021.                                                                                                                     -50%
                                                                      20
•   2022 is pacing just 11% below 2019 levels                                                                                                           -60%

•   While group is normally the slowest segment to                       0                                                                              -70%
                                                                                     2019                  2020           2021     2022   2023   2024
    recover, with so many definite room nights already on
                                                              Source: Lodging Analytics Research & Consulting
    the books, we believe convention group will snap back
    faster than in past recoveries
Gross Savings Rate

    Unprecedented Savings Rate                                              NIPA U.S. Gross Savings Rate
     Coming Out of Downturn                                                                             (Billions, SAAR)
•   The U.S. Gross Savings Rate ended 2020 at
    $4.2 trillion                                    $4,500
•   Not only is this the highest level on record,    $4,000
    but it is a 3% increase from pre-pandemic        $3,500
    levels                                           $3,000
     •   The increase is primarily fueled by stock
                                                     $2,500
         market gains and low spending during the    $2,000
         pandemic                                    $1,500
                                                     $1,000
•   During the GFC the gross savings rate
    declined 11% and during the 9/11 downturn
                                                       $500
    the gross savings rate declined 5%                   $0

                                                                           1990Q1
                                                                           1992Q1
                                                                           1994Q1
                                                                           1996Q1
                                                                           1998Q1
                                                                           2000Q1
                                                                           2002Q1
                                                                           2004Q1
                                                                           2006Q1
                                                                           2008Q1
                                                                           2010Q1
                                                                           2012Q1
                                                                           2014Q1
                                                                           2016Q1
                                                                           2018Q1
                                                                           2020Q1
•   The current U.S. gross savings rate is
    approximately double what it was after the
    GFC                                              Source: Moody’s Analytics, Lodging Analytics Research & Consulting
2020 Economic Activity Better than Headlines for Lodging

Sector Performance, Stock Market
  Support Corporate Transient                                                                     2020 Sector GDP Growth
            Recovery
•   Combined- the sectors that drive the most    10%
                                                  5%                                                                                                                                                                                                                                   3.6%
    corporate transient demand across the                                                                                                                                                                                                                       0.3%
    lodging sector experienced no decline in      0%
    2020; information Technology was up 3.6%,    -5%                                                                           -3.2% -2.2% -2.2% -2.1%
    Financial Activities were up 0.3% and        -10%                                                        -5.8% -5.6% -4.5%
    Professional Services were down 2.2%         -15%                                      -12.3%
•   In 2020, the S&P 500 set an all-time high    -20%
    and closed 15.2% above year-end 2019. It     -25%
    is up another 22% year-to-date (9/7/2021).   -30% -27.2%

                                                                                                             Education and Health
                                                                 Leisure and Hospitality

                                                                                                                                                                                                                     Professional and Business

                                                                                                                                                                                                                                                                                       Information Technology
                                                                                            Other Services

                                                                                                                                                                                                                                                                Financial Activities
                                                                                                                                    Natural Resources and

                                                                                                                                                            Trade, Transportation and

                                                                                                                                                                                        Manufacturing

                                                                                                                                                                                                        Government

                                                                                                                                                                                                                                                 Construction
     •   During the GFC, the S&P 500 dropped
         27%

                                                                                                                   Services

                                                                                                                                            Mining

                                                                                                                                                                                                                              Services
     •   During the 9/11 Downturn, the S&P 500

                                                                                                                                                                     Utilities
         dropped 40%

                                                 Source: Lodging Analytics Research & Consulting
Fiscal Stimulus- Covid-19 is 5x As Large as the GFC

         Fiscal Stimulus Packages                                                                             Fiscal Stimulus Totals (Billions)
Stimulus Package                                                       Value (Billions)
                                                                                           $9,000                                                                                     $8,320
Great Financial Crisis
2008 Economic Stimulus Act                                                        $152     $8,000
American Recovery Act                                                             $840
                                                                                           $7,000
Total                                                                             $992
 as % of 2007 GDP                                                                  6.3%    $6,000
                                                                                                                                                           $4,820
                                                                                           $5,000
Covid-19 Pandemic
CARES Act                                                                       $2,000     $4,000
December Emergency Coronavius Relief                                              $920
American Rescue Plan                                                            $1,900
                                                                                           $3,000

Total Covid-19 Stimulus To Date                                                 $4,820     $2,000
 as % of 2019 GDP                                                                25.2%                                                 $992
                                                                                           $1,000
Infrastucture Plan + Budget Reconcilation "Build Back Better" Agenda            $3,500             $0
Total Assumed Covid-19 Stimulus                                                 $8,320                            Great Financial Crisis      Total Covid-19 Stimulus To   Total Assumed Covid-19
 as % of 2019 GDP                                                                43.6%                                                                   Date                      Stimulus
                                                                                          Source: Lodging Analytics Research & Consulting
U.S. Outlook
Covid-19 and Fiscal Policy Assumptions

•   The Delta Variant slows the corporate/ group travel recovery by a couple months
•   No new variants impact children or the vaccinated in any meaningful way
•   $550 billion infrastructure bill gets signed in the Fall
•   President Biden’s $3 trillion “Build Back Better” fiscal package will pass in late 2021 via
    budget reconciliation and be implemented beginning in 2022
•   Elevated inflation is transitory and labor supply constraints will ease in September
Delta Impact – Return to Office Delays
                                            Sampling of Delta-Induced Reopening Delays
                                         Company                                           Scheduled Date                      Comments
                                         Goldman Sachs                                          June-21                      Vaccinated only
• Many companies have pushed             JP Morgan Chase                                        July-21                   Encouraging vaccines
  back their return to the office as a   Eli Lilly
                                         Bank of America
                                                                                                July-21
                                                                                            September-21
                                                                                                                        Vaccine Mandate by 11/15
                                                                                                                             Vaccinated only
  little as one month, to all the way    CVS                                                September-21
  to early 2022                          Pfizer                                             September-21               Vaccine/ Testing mandate
                                         UPS                                                September-21             Vaccine Mandate by 10/1/2021
• Financial services are generally       Washington Post                                    September-21                  Vaccination Mandate
  the more aggressive companies          Wells Fargo
                                         Blackrock
                                                                                             October-21
                                                                                             October-21
                                                                                                                    Pushed back from 10/4 to 10/18
                                                                                                                             Vaccinated only
  in the timing of a return to the       Microsoft                                           October-21                      Vaccinated only
  office                                 Comcast                                             October-21              Pushed back from September
                                         Viacom CBS                                          October-21                Delayed from September
• Tech companies are less                Travelers Cos.                                      October-21        Delayed "at least a month" from September
  aggressive                             TJ Maxx
                                         PwC
                                                                                            November-21
                                                                                            November-21
                                                                                                                            Vaccine Mandate
                                                                                                                       Delayed from September
• Some companies have                    Apple
                                         Amazon
                                                                                              January-22
                                                                                              January-22
                                                                                                                       Pushed back from October
                                                                                                                     Pushed back from September
  postponed their returns                Starbucks                                            January-22               Pushed back from October
  indefinitely                           Ford Motor Company                                   January-22
                                         Google                                               January-22        Pushed back from mid-October to January
                                         Uber                                                 January-22           Pushed back from late September
                                         Lyft                                                February-22
                                         Airbnb                                             September-22              No change due to Delta variant
                                         Twitter                                                  TBD       Closed offices in New York and San Francisco in July
                                         New York Times                                           TBD                   Cancelled September return
                                         Source: Lodging Analytics Research & Consulting
Supply

     Key Supply Assumptions                         U.S. Lodging Supply Growth
                                                                          (forecasts begin 3Q-2021)
•   Almost all current hotel closures are     2019
                                                                        1Q
                                                                      2.0%
                                                                                             2Q
                                                                                            2.0%
                                                                                                                        3Q
                                                                                                                      2.0%
                                                                                                                                4Q
                                                                                                                              2.1%
                                                                                                                                       Year
                                                                                                                                      2.0%
    temporary and virtually all temporarily   2020                    2.0%                 -10.2%                     -3.4%   -3.4%   -3.6%
    closed hotels will be open by the end     2021 F                  -1.9%                13.4%                      7.9%    5.6%    6.3%
                                              2022 F                  5.7%                  4.1%                      1.9%    1.8%    3.4%
    of 3Q-2021.                               2023 F                  1.5%                  1.1%                      1.1%    1.5%    1.3%

•   Construction/ opening delays have         '20 - '23F CAGR                                3.6%
    been rolling off throughout 2021,         '20 - '25F CAGR                                2.9%

    which will cause more hotels to open
    in late 2021 driving an acceleration in     U.S. Economic Supply Growth
    economic supply growth into late 2021                                 (forecasts begin 3Q-2021)
    and early 2022, before supply growth                              1Q                     2Q                    3Q          4Q     Year
    begins to moderate again.                 2019                   2.0%                   2.0%                  2.0%        2.1%    2.0%
                                              2020                   2.0%                   2.7%                  1.3%        1.2%    1.4%
                                              2021 F                 1.0%                   1.6%                  1.4%        2.3%    1.6%
                                              2022 F                 2.7%                   2.0%                  1.9%        1.8%    2.1%
                                              2023 F                 1.5%                   1.1%                  1.1%        1.5%    1.3%

                                              '20 - '23F CAGR                                1.7%
                                              '20 - '25F CAGR                                1.8%
                                              Source: Lodging Analytics Research & Consulting, BuildCentral and STR
RevPAR Model

         Key Model Drivers                                              RevPAR, Seasonally Adjusted
                                 $120
                                                         Actual RevPAR, SA
•   Unemployment Rate                                    Modeled RevPAR, SA

•   Real GDP                     $100              R-Squared = 99.7%
                                                   Standard Error = 4.3%

•   Business Investment           $80

•   S&P 500 Index
•   Real Foreign Exchange Rate    $60

•   Supply                        $40

                                  $20

                                    $0
                                         1Q00
                                                1Q01
                                                       1Q02
                                                              1Q03
                                                                     1Q04
                                                                            1Q05
                                                                                   1Q06
                                                                                          1Q07
                                                                                                 1Q08
                                                                                                        1Q09
                                                                                                               1Q10
                                                                                                                      1Q11
                                                                                                                             1Q12
                                                                                                                                    1Q13
                                                                                                                                           1Q14
                                                                                                                                                  1Q15
                                                                                                                                                         1Q16
                                                                                                                                                                1Q17
                                                                                                                                                                       1Q18
                                                                                                                                                                              1Q19
                                                                                                                                                                                     1Q20
                                                                                                                                                                                            1Q21
                                                                                                                                                                                                   1Q22
                                                                                                                                                                                                          1Q23
                                                                                                                                                                                                                 1Q24
                                                                                                                                                                                                                        1Q25
                                 Source: STR and Lodging Analytics Research & Consulting
ADR Model

          Key Model Drivers                                                     ADR, Seasonally Adjusted
                              $160
                                                           Actual ADR, SA
•   Business Investment                                    Modeled ADR, SA
                              $140
•   Inflation                                   R-Squared = 98.6%
                                                Standard Error = 3.0%
                              $120
•   Consumer Confidence
                              $100
•   Unemployment Rate
                               $80

                               $60

                               $40

                               $20

                                $0
                                      1Q00
                                             1Q01
                                                    1Q02
                                                           1Q03
                                                                  1Q04
                                                                         1Q05
                                                                                1Q06
                                                                                       1Q07
                                                                                              1Q08
                                                                                                     1Q09
                                                                                                            1Q10
                                                                                                                   1Q11
                                                                                                                          1Q12
                                                                                                                                 1Q13
                                                                                                                                        1Q14
                                                                                                                                               1Q15
                                                                                                                                                      1Q16
                                                                                                                                                             1Q17
                                                                                                                                                                    1Q18
                                                                                                                                                                           1Q19
                                                                                                                                                                                  1Q20
                                                                                                                                                                                         1Q21
                                                                                                                                                                                                1Q22
                                                                                                                                                                                                       1Q23
                                                                                                                                                                                                              1Q24
                                                                                                                                                                                                                     1Q25
                              Source: STR and Lodging Analytics Research & Consulting
Expenses and EBITDA

                                                             U.S. Lodging Wage Growth
    Key Expense Assumptions                                                     (forecasts begin 2Q-2021)
                                                                     1Q                         2Q                3Q      4Q      Annual
•   Property Taxes will grow at a 4.5%      2019                    3.8%                       3.8%              3.9%    2.4%      3.5%
    CAGR through 2025                       2020                    2.3%                      -2.9%              0.0%    4.8%      1.1%
                                            2021 F                  8.0%                       7.9%              2.3%   -3.1%     3.7%
•   Wages will increase at a 3.4% CAGR
    through 2025                            2022 F                 -5.9%                      -0.7%              2.3%    3.9%     -0.2%
                                            2023 F                  4.4%                       4.5%              4.4%    5.1%     4.6%
•   Other Expenses will grow at inflation   2024 F                  5.0%                       4.8%              4.8%    4.5%     4.8%
•   We assume historical levels of cost     2025 F                  4.3%                       4.3%              4.3%    4.3%     4.3%
                                            Source: Lodging Analytics Research & Consulting, Moody’s Analytics

    flexing related to occupancy and for
    negative environments                                      U.S. Hotel EBITDA Growth
                                                                 1Q                   2Q       3Q                     4Q   Annual Vs. 2019
                                            2021 F             -84.0%              -330.1% -28995%                 863.7% 403.1% -51.0%
                                            2022 F             601%                  71%     5.0%                  78.6% 65.2% -19.1%
                                            2023 F             50.0%                26.7%   15.0%                    7.8% 23.1%    -0.4%
                                            2024 F             10.5%                10.3%    8.2%                    7.0%  9.1%    8.6%
                                            2025 F             -0.2%                -2.1%    -1.6%                  -1.1%  -1.3%   7.2%
                                            Source: Lodging Analytics Research & Consulting
Cap Rate Model

         Key Model Drivers                                                                       Hotel Cap Rates
                                 10.0%

Macro-economic Factors            9.0%

•   Baa Bond Yields               8.0%

•   High Yield Bond Spreads       7.0%

•   Real Foreign Exchange Rate    6.0%

•   Real GDP                      5.0%

                                  4.0%
•   Unemployment Rate                                          Actual Cap Rate
                                  3.0%                         Modeled Cap Rate
Lodging Industry Factors:                            R-Squared= 98.3%
                                  2.0%               Standard Error= 22 bps
•   Lodging Supply
                                  1.0%

                                  0.0%
                                           2005-2Q

                                                     2006-2Q

                                                               2007-2Q

                                                                         2008-2Q

                                                                                   2009-2Q

                                                                                             2010-2Q

                                                                                                       2011-2Q

                                                                                                                 2012-2Q

                                                                                                                           2013-2Q

                                                                                                                                     2014-2Q

                                                                                                                                               2015-2Q

                                                                                                                                                         2016-2Q

                                                                                                                                                                   2017-2Q

                                                                                                                                                                             2018-2Q

                                                                                                                                                                                       2019-2Q

                                                                                                                                                                                                 2020-2Q

                                                                                                                                                                                                           2021-2Q

                                                                                                                                                                                                                     2022-2Q

                                                                                                                                                                                                                               2023-2Q

                                                                                                                                                                                                                                         2024-2Q

                                                                                                                                                                                                                                                   2025-2Q
                                 Source: Real Capital Analytics and Lodging Analytics Research & Consulting
U.S. Forecast Summary
                                                                                                U.S. Hotel Industry Forecast Summary
                 Key Takeaways                                                                                                               3-Year 5-Year
We forecast ADR to recover to 2019 levels in 2022, while RevPAR,
                                                                                                                                       2021 Forward Forward
Hotel EBITDA and asset values will reach 2019 levels in 2023.                                                                         Growth CAGR CAGR
Occupancy won’t reach 2019 levels until 2024.                                                       Economic Supply                    1.6%     1.7%    1.8%
Key changes from June Outlook:                                                                      Demand                             29.6%    15.9%   10.4%
•   The summer leisure season proved stronger than expected as ADR                                  Occupancy                          28.0%    14.2%   8.6%
    proved much more resilient despite low absolute occupancy levels                                ADR                                17.1%    10.7%   7.5%
•   The Delta Variant has delayed the acceleration of corporate and                                 RevPAR                             49.9%    26.4%   16.8%
    group travel by at least a couple months. In June, we had expected it
    to occur after Labor Day, now we are looking at November and                                    Hotel EBITDA                      403.1% 117.1% 61.6%
    possibly after the new year.                                                                    Hotel Values                       19.5%    11.8%   7.0%
•   Despite the stronger summer leisure season, our longer-term outlook
    for demand and occupancy is essentially unchanged                                                     2021 U.S. Hotel Industry Outlook
                                                                                                                                9/2021 Update     6/2021 Update   Outlook
•   Our long-term outlook on ADR has improved by about 3% as the
    improved 2021 ADR recovery will give the industry a stronger base to                                                        YoY    Growth     YoY    Growth    Change
    build from going forward, slightly enhancing pricing power over the                                                       Growth vs. 2019   Growth vs. 2019   vs. 2019
    course of the next few years.                                           Economic Supply                                    1.6%     2.9%     1.4%     2.9%      0.0%
•   2021 values improve tied to lower base rates and better cash flows,     Demand                                             29.6% -13.7%      28.4% -17.4%       3.8%
    but longer–term values are only slightly higher.                        Occupancy                                          28.0% -14.7%      21.8% -18.8%       4.1%
                                                                            ADR                                                17.1%    -7.9%    7.2%    -15.7%     7.8%
                                                                            RevPAR                                             49.9% -21.4%      30.6% -31.5%      10.1%
                                                                            Hotel EBITDA                                      403.1% -51.0%     167.7% -73.8%      22.8%
                                                                            Hotel Values                                       19.5%    -8.9%    1.2%    -22.9%    14.1%
                                                                            Source: Lodging Analytics Research & Consulting
Hotel Values- This Cycle
                                                                                       Hotel Value Recovery in GFC vs.
    Hotel Value Recovery Timeline
                                                                                         Forecast for Current Cycle
•    Following the Great Financial Crisis, Hotel Values dropped
     27% from the 2007 peak to the 2009 trough                       110                                               GFC Downturn                                   Current Cycle
•    Following the Great Financial Crisis, Hotel Values did not
     recover to the 2007 peak until 2015
                                                                     100
•    Roughly $1 trillion in fiscal stimulus passed
•    By 2018, values were 18% above the prior 2007 peak                  90
•    Values began declining in 2019, in advance of the
     pandemic
                                                                         80
•    We assume $8 trillion in fiscal stimulus- $4.8 trillion
     already passed and another $3.5 trillion passed in late
     2021, but rolled out over several years for Biden’s “Build          70
     Back Better” agenda
•    We estimate values would have declined 23.8% in 2020, in
     a fully transparent environment, which will bring the total         60
     decline from the 2018 peak to 29%, comparable to the

                                                                                          Year 0

                                                                                                           Year 1

                                                                                                                            Year 2

                                                                                                                                               Year 3

                                                                                                                                                        Year 4

                                                                                                                                                                 Year 5

                                                                                                                                                                          Year 6

                                                                                                                                                                                   Year 7

                                                                                                                                                                                            Year 8
     decline experienced in the GFC
•    We forecast values to recover to 2019 levels by 2023, and
     to the 2018 prior peak by 2024. However, we forecast a
     decline in values in 2025, that will bring 2025 values on par   Source: Lodging Analytics Research & Consulting, Real Capital Analytics
     with the 2018 peak.
Outlook vs. Past Cycles
                                                              Months of Recovery to Prior Peak
         Recovery Timeline
                                                                         By Cycle
•   In general, we expect the recovery        120                                            9/11                            GFC                  Covid
    from this cycle to be meaningfully        100                                            vs. 9/11                        vs. GFC                               96

    swifter than past cycles, despite the                               81
                                               80                                                                                                                       72
    deeper decline                                                65          63                                                             59
                                               60                                                         45
                                                                                                                52                      52
•   Relative to the Great Financial Crisis,                                                                             36
                                                                                                                                                  42

    our outlook is anywhere from a year        40
    and a half to two years faster,            20
    depending on the metric                        0
                                                                                     -2
•   Relative to 9/11, our outlook is          -20                                         -18
                                                                                                                             -9
                                                                                                                                  -16
                                                                                                                                                       -10
                                                                                                                                                             -17
    anywhere from 2 to 10 months faster,      -40
                                                                                                                                                                             -24

    depending on the metric                                      Occupancy                                        ADR                    RevPAR                    Values
                                              Source: Lodging Analytics Research & Consulting, Real Capital Analytics
LARC vs. Other Forecasts

              Highlights                                                          Current Forecasts
                                                               2021      2022                                          2023      2024      2025
                                          STR/ Tourism Economics - August 12
•   Most recent forecasts are most
                                          Occupancy           57.9%     65.5%
    positive for 2021 (LARC and STR) as   ADR               $115.64 $122.58
    the summer season exceed all          RevPAR             $66.99    $80.19                                         $84.99    $90.10
    expectations
                                          PwC - May 28
•   LARC remains much more positive for   Occupancy                                     57.2%                 61.8%
    ADR recovery than others              ADR                                         $111.20               $118.49
                                          RevPAR                                       $63.57                $73.25

                                          CBRE - March 30
                                          Occupancy                                      49.1%                61.7%     65.1%     65.5%     65.2%
                                          ADR                                           $99.46              $113.21   $127.02   $136.63   $143.07
                                          RevPAR                                        $48.81               $69.85    $82.65    $89.51    $93.27
                                          July 20 Update
                                          ADR                                         $107.69               $119.97

                                          LARC - September 1
                                          Occupancy            56.4%                                          61.1%     65.6%     66.5%     66.6%
                                          ADR                $120.86                                        $133.42   $140.06   $145.31   $148.16
                                          RevPAR              $68.15                                         $81.47    $91.88    $96.66    $98.71
                                          Source: Lodging Analytics Research & Consulting, STR, PwC, CBRE
Market Highlights
LARC’s Top-26 Market Coverage Universe

           26 Hotel Markets: STR’s Top 25, Las Vegas
Model Statistics
                         Model Accuracy Based on R-squareds and
                         Back-Testing to 2000 (2005 for cap rates)
                                                       R-Squareds for our Mult-Variable Regression Forecasting Models
                                                   RevPAR Forecast              ADR Forecast             Cap Rate Forecast
             Anaheim, CA                                99.2%                       99.8%                       99.6%
             Atlanta, GA                                99.2%                       99.8%                       98.2%
             Boston, MA                                 99.4%                       91.1%                       99.5%
             Chicago, IL                                99.2%                       99.7%                       98.3%
             Dallas, TX                                 99.5%                       89.2%                       99.8%
             Denver, CO                                 92.3%                       99.7%                       99.8%
             Detroit, MI                                99.4%                       89.9%                       99.6%
             Houston, TX                                91.7%                       92.1%                       98.2%
             Las Vegas, NV                              99.5%                       99.7%                       99.5%
             Los Angeles, CA                            94.0%                       93.8%                       98.3%
             Miami, FL                                  99.5%                       99.6%                       99.7%
             Minneapolis, MN                            99.4%                       99.8%                       99.7%
             Nashville, TN                              99.3%                       99.6%                       99.6%
             New Orleans, LA                            99.2%                       99.6%                       98.4%
             New York, NY                               99.6%                       99.7%                       94.8%
             Norfolk, VA                                98.9%                       99.7%                       98.4%
             Honolulu, HI                               95.5%                       97.6%                       98.3%
             Orlando, FL                                99.5%                       98.7%                       98.3%
             Philadelphia, PA                           99.6%                       99.8%                       99.7%
             Phoenix, AZ                                99.5%                       99.8%                       99.2%
             San Diego, CA                              99.6%                       99.8%                       98.3%
             San Francisco, CA                          94.7%                       92.3%                       98.3%
             Seattle, WA                                93.6%                       92.9%                       99.7%
             St Louis, MO                               89.8%                       93.1%                       99.6%
             Tampa, FL                                  99.2%                       91.2%                       99.8%
             Washington, DC                             89.7%                       99.8%                       99.5%
             United States Total                           99.7%                   98.6%                      98.3%
              Source: Lodging Analytics Research & Consulting
2021 Outlook

2021 Top Performers (vs. 2019)                                                                                                                                    2020 Market
                                                                                                                                                                    2021        Performance
                                                                                                                                                                         Bottom Performers (vs. 2019)
Norfolk, Miami and Tampa: The only markets                                                                                                                                                       San Francisco, Boston, New York, Washington,
among the top-26 with RevPAR projected to                                                                                                                                                        D.C., and Seattle: Fly-to, High-Density,
exceed 2019 levels this year. They all have                                                                                                                                                      International-Focus
strong leisure activity and two of the three are
almost exclusively domestic markets.

                                                                  RevPAR Growth Rates for the Top 26 Markets - 2021 vs. 2019
                           20%
                           10%
                            0%
                          -10%
                          -20%
                          -30%
                          -40%
                          -50%
                          -60%
                          -70%
                                                                                                                                       Dallas, TX

                                                                                                                                                                                                                                                                                                                                                                                              New York, NY
                                                                                                                                                                                                                                              Denver, CO
                                                    Miami, FL

                                                                                                                         Atlanta, GA

                                                                                                                                                                                                                Orlando, FL
                                                                                                                                                                                              Los Angeles, CA
                                                                                          San Diego, CA
                                                                                                          St Louis, MO

                                                                                                                                                                                                                                                                              Las Vegas, NV
                                                                            Phoenix, AZ

                                                                                                                                                                                                                                                                                                                                                               Seattle, WA

                                                                                                                                                                                                                                                                                                                                                                                                             Boston, MA
                                                                Tampa, FL

                                                                                                                                                                                                                                                                                                             Minneapolis, MN

                                                                                                                                                                                                                                                                                                                                                                                                                          San Francisco, CA
                                                                                                                                                                                                                                                                                              Honolulu, HI

                                                                                                                                                                                                                                                                                                                               New Orleans, LA
                                                                                                                                                                                Anaheim, CA

                                                                                                                                                                                                                                                           Philadelphia, PA
                                                                                                                                                    Houston, TX

                                                                                                                                                                                                                              Nashville, TN

                                                                                                                                                                                                                                                                                                                                                 Chicago, IL
                                      Norfolk, VA

                                                                                                                                                                  Detroit, MI

                                                                                                                                                                                                                                                                                                                                                                             Washington, DC
                          Source: Lodging Analytics Research & Consulting
RevPAR Recovery Back to 2019 Levels- Markets Diverge
                                                        % of Markets Reaching 2019 RevPAR by Year
               Key Takeaways                            70%
                                                        60%
•   The majority of the 44 markets in our standard
    coverage universe will recover to 2019 in 2023 or   50%

    2024. However, some will diverge                    40%
                                                        30%
     •   3 will recover in 2021
                                                        20%
     •   2 in 2022
                                                        10%
     •   2 in 2025
                                                           0%
                                                                                       2021         2022         2023    2024           2025

•   A faster recovery largely coincides with a higher                   Comparison of RevPAR recovery Year to
    RevPAR looking out to 2025, but not always.
                                                                         2025 RevPAR Premium to 2019 Levels
                                                                                 30%
    There are several markets that won’t reach 2019
    levels until 2023 or 2024 but will have higher                               25%

                                                          2025 RevPAR vs. 2019
    relative RevPAR by 2025 than markets that reach                              20%

    2019 levels in 2021 or 2022.                                                 15%

                                                                                 10%

                                                                                 5%

                                                                                 0%
                                                                                   2020       2021        2022   2023   2024     2025     2026
                                                                                                      Year Back to 2019 RevPAR

                                                        Source: Lodging Analytics Research & Consulting
2025 Outlook Relative to 2019
Top Performers
Tampa: Strong economic growth, moderate supply growth and outsized exposure to domestic                                     RevPAR Growth Rates for the Top 26 Markets – 2025 Outlook vs. 2019
leisure demand will make Tampa an outperformer. Additionally, with cap rates stabilizing only        30%
slightly above 2019 levels, 2025 asset values will be 18% above 2019 levels.                         25%
                                                                                                     20%
Phoenix: Strong economic growth will offset elevated supply growth, driving Phoenix operating
fundamentals to recover to 2019 levels at a swifter pace than most other major markets. We           15%
expect RevPAR to reach 2019 levels by 2022 and Hotel EBITDA by 2023. EBITDA growth,                  10%
coupled with modest cap rate compression, will result in 2025 asset values that are 15% above          5%
2019 levels.
                                                                                                       0%

                                                                                                                                            Denver, CO

                                                                                                                                                                                                                                                                                                               Dallas, TX
                                                                                                                                                                                                                                                                                                Orlando, FL

                                                                                                                                                                                                                                                                                                                                                                                                                                                             New York, NY
                                                                                                                                                                             Las Vegas, NV

                                                                                                                                                                                                                                                                                                                             Los Angeles, CA
                                                                                                                                                                                                                                                 Atlanta, GA

                                                                                                                                                                                                                                                                                                                                                                                     St Louis, MO

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            Boston, MA
                                                                                                                Miami, FL

                                                                                                                                                                                                                                                                                                                                                                    San Diego, CA

                                                                                                                                                                                                                                                                                                                                                                                                                        Seattle, WA

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        San Francisco, CA
                                                                                                                                                                                                                                                                Anaheim, CA

                                                                                                                                                                                                                                                                                                                                                Philadelphia, PA
                                                                                                                              Tampa, FL

                                                                                                                                                                                              Phoenix, AZ
                                                                                                                                                                                                              New Orleans, LA

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           Houston, TX
                                                                                                                                                                                                                                                                               Nashville, TN

                                                                                                                                                                                                                                                                                                                                                                                                                                          Minneapolis, MN
                                                                                                                                                            Honolulu, HI

                                                                                                                                                                                                                                  Norfolk, VA

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         Detroit, MI
                                                                                                                                                                                                                                                                                                                                                                                                      Washington, DC

                                                                                                                                                                                                                                                                                                                                                                                                                                                                              Chicago, IL
Denver: Fueled by above average economic growth and moderating economic supply growth,
Denver’s recovery is off to a strong start and is expected to accelerate into 2022. Outsized
economic growth will generate outsized ADR and RevPAR growth, while limited expense
growth will help drive outsized EBITDA growth. While cap rates will stabilize slightly below 2019
levels, EBITDA growth will be the primary driver of value appreciation as we expect 2025 asset
values to be 12% above 2019 levels.                                                                 Source: Lodging Analytics Research & Consulting

Los Angeles: Once occupancy begins to recover, the market will have robust pricing power,                                                 Hotel Value Change for the Top 26 Markets – 2025 Outlook vs. 2019
driving outsized RevPAR and ADR growth. Elevated expense growth will mitigate some of the
                                                                                                     20%
benefits of strong ADR growth, limiting EBITDA growth. However, EBITDA growth coupled with           15%
cap rate compression will result in 2025 asset values which are 10% above 2019 levels.               10%
                                                                                                      5%
Nashville: Elevated supply growth will weigh on the market, preventing occupancy from fully           0%
recovering to 2019 levels by 2025. However, the market’s emergence as a three-demand-                -5%
                                                                                                    -10%
segment (corporate, group and leisure) locale will drive ADR and RevPAR to 2019 levels by           -15%
2023. By 2025, Hotel EBITDA will be just 1% below 2019 levels, while cap rate compression           -20%
drives 2025 asset values to be 7% above 2019 levels.                                                -25%

                                                                                                                                                                                                                                                                                                                                                                   Dallas, TX

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         New York, NY
                                                                                                                                          Denver, CO
                                                                                                                                                         Los Angeles, CA

                                                                                                                                                                                                                                                                                                                            San Diego, CA
                                                                                                                                                                                             Miami, FL

                                                                                                                                                                                                                                Orlando, FL

                                                                                                                                                                                                                                                                                                                                                                                                     Atlanta, GA
                                                                                                                                                                                                                                                                              Seattle, WA
                                                                                                                                                                                                            Las Vegas, NV

                                                                                                                                                                                                                                                                                                              Boston, MA

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            St Louis, MO
                                                                                                              Tampa, FL
                                                                                                                            Phoenix, AZ

                                                                                                                                                                                                                                                                                                                                                                                                                       Minneapolis, MN
                                                                                                                                                                                                                                                Anaheim, CA

                                                                                                                                                                                                                                                                                                                                                                                                                                         Philadelphia, PA

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        San Francisco, CA
                                                                                                                                                                                                                                                                                                                                                                                                                                                            New Orleans, LA
                                                                                                                                                                                                                                                               Honolulu, HI
                                                                                                                                                                           Nashville, TN

                                                                                                                                                                                                                                                                                                                                               Houston, TX

                                                                                                                                                                                                                                                                                                                                                                                                                                                                              Detroit, MI

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           Chicago, IL
                                                                                                                                                                                                                                                                                                                                                                                    Washington, DC
                                                                                                                                                                                                                                                                                               Norfolk, VA
                                                                                                    Source: Lodging Analytics Research & Consulting
Third Quarter Sentiment Shifts

Improving Outlook                                                                                 2020Markets
                                                                                                       Marketswith Greatestwith
                                                                                                                           Changes inlargest
                                                                                                                                      Long-Term Value Change (vs. 2019)
Norfolk: Much stronger ADR growth through the summer leisure season indicates the market has
much more pricing power than previously expected. That will support stronger ADR growth,          change                   Outlook vs. Last Quarter
                                                                                                                                            Current Quarter Value Change
which will drive EBITDA and values higher.                                                                                                                             Last Quarter Value Change
                                                                                                                                   13.6%
Anaheim & Orlando: The recovery of the theme park demand happened much more quickly than                  15%                                                          Difference
anticipated. We now forecast these leisure heavy markets to recover more quickly than last                10%                                                               6.9%     8.3%
quarter, particularly pertaining to ADR growth which fuel an increase in our EBITDA outlook,                                                      3.9% 5.5% 4.2% 5.4%                            4.2%
                                                                                                                         2.6%                                         3.6%
driving values higher.
                                                                                                           5%                                                                     2.3%

Seattle: An improving economic outlook, across the market support an improvement to our long-              0%
term views on Seattle, making us less cautious on the market long-term.                                   -5%                                          -1.6%         -1.2%                          -1.2%
                                                                                                                                                                               -3.3%
                                                                                                         -10%                                                                               -6.0%           -5.4%

Deteriorating Outlook                                                                                    -15%                -11.1%

                                                                                                                                                                                                       Atlanta
                                                                                                                                                                     Orlando
                                                                                                                                                           Anaheim

                                                                                                                                                                               Seattle

                                                                                                                                                                                         Boston
                                                                                                                                Norfolk
Boston: Our cap rate outlook, while still very positive is not as positive as a quarter ago, as rising
base rates, coupled with slowing fundamentals in the later years of our forecast weigh on Boston
values. We remain positive on Boston, but our outlook is moderating
Atlanta: Our models now forecast lower ADR growth over the long-term based on the components
                                                                                                         Source: Lodging Analytics Research & Consulting
of economic growth across the market. That lower ADR growth will limit revenues and EBITDA
over the longer-term. That will weigh on cap rates and drive modest value erosion vs. our prior
forecast.
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