N O R W E G I A N H O T E L R E P O R T F I R S T Q U A R T E R Q OSLO BERGEN STAVANGER GARDERMOEN TROMSØ TRONDHEIM

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1 N O R W E G I A N H O T E L R E P O R T F I R S T Q U A R T E R Q OSLO BERGEN STAVANGER GARDERMOEN TROMSØ TRONDHEIM

2 I N T R O D U C T I O N N H C N O R W AY N O R W E G I A N H O T E L R E P O R T It is a pleasure to present the first hotel report in 2018 for the six main hotel destinations in Norway. The report summarizes each month in the quarter, the quarter, and 12 months rolling performance. Performance is benched against last years performance in the same market. Data regarding performance is collected by Benchmarking Alliance and gives a very good indicator of shifts in markets. Using data from Benchmarking Alliance also allows us to publish data swiftly without having to wait for national statistics collected by SSB. In addition to the market indicators we also have a city comparison, pipeline overview of new developments and hotels that are closed for renovation together with a list of recent hotel transactions in the Norwegian market. In the end of the report you will find a glossary of terms and our contact information. S E R V I C E S O F F E R E D B Y N H C Op erator Search Interim Management Op eration Op timization Financing Asset Man agemen t Tran saction s Market & Feasibility Studies Valu ation s Con tract Negotiation s Spa Consulting

3 Q 1 H I G H L I G H T S Q1 has a negative developmen t in 5 of 6 destinations due to the fact that Easter in 2018 was in March, and in 2017 Easter was in April. Easter is a very quiet period in the Norwegian hotel market due to a drop in the business and conference segment. This affects overall performance in a negative way. The hotel market in Tromsø experienced a significant RevPAR improvemen t in Q1 with a 5,9% growth including the shift of Easter from last year. RevPAR improvemen t in Tromsø was driven by an ADR increase of 10,9% RevPAR development in Q compared to Q1 2017: Oslo -1,2% Bergen - 15, 6% Stavanger -4,4% Gard ermoen - 1, 6% Tromsø 5, 9% Trondheim -2,6%

4 M A R K E T I N D I C A T O R S O S L O O S L O In the first quarter, Oslo experien ced a negative developmen t in RevPAR of 1,2% to NOK 653. This negative trend is caused by a decrease in RevPAR in March due to the shift of Easter from last year. 12M rolling the Oslo market has an increase in RevPAR of 9,3%. RevPAR growth in Oslo is driven by the fact that 2 hotels have been closed for renovation. The total amount of rooms actually sold is 2,4% less than the previous 12M. Source: Benchmarking Alliance

5 M A R K E T I N D I C A T O R S B E R G E N B E R G E N In the first quarter, Bergen experienced a negative development in RevPAR of 15,6% to NOK 357. This negative trend is caused by an increase in supply of 25,8% in Q1 combined with a decrease in RevPAR in March due to the shift of Easter from last year. 12M rolling the Bergen market has a decrease in RevPAR of 9,7%. RevPAR decrease in Bergen is driven by an increase in supply of 28,5% the past 12M. This has affected the occupancy in a negative way, but actual rooms sold has increased with 13,9% the past year, so the total market has grown even though occupancy is decreasing. Source: Benchmarking Alliance

6 M A R K E T I N D I C A T O R S S T A V A N G E R S TA V A N G E R In Q1, Stavanger experienced a negative development in RevPAR of 4,4% to NOK 346. The negative development is caused by a drop in RevPAR during March due to the shift of Easter from last year. 12M rolling the Stavanger market has an increase in RevPAR of 1,3%. RevPAR increase in Stavanger is driven by an increase in occupancy of 3,6% the past year. It seems like th e Stavan ger market h as stab ilized after several years with a n egative d evelop men t. Source: Benchmarking Alliance

7 M A R K E T I N D I C A T O R S G A R D E R M O E N G A R D E R M O E N In the first quarter, Gardermoen experienced a negative development in RevPAR of 1,6% to NOK 616. The negative development is caused by a drop in RevPAR during March due to the shift of Easter from last year. 12M rolling the Gardermoen market has an increase in RevPAR of 9,0%. RevPAR increase in Gardermoen is driven by an increase in ADR and Occupancy. Source: Benchmarking Alliance

8 M A R K E T I N D I C A T O R S T R O M S Ø T R O M S Ø In the first quarter, Tromsø experienced a positive developmen t in RevPAR of 5,9% to NOK 930. The positive developmen t is caused by a increase in RevPAR during the first 2 months of the quarter. Tromsø also had a negative developmen t In March due to the shift of Easter from last year. The high RevPAR in Q1 is a result of tourism related to the Aurora Borealis (Northern Lights) 12M rolling the Tromsø market has an increase in RevPAR of 9,6%. RevPAR increase in Tromsø is driven by an increase in ADR of 7.0% and increase in Occupancy of 2,4% the past year. Source: Benchmarking Alliance

9 M A R K E T I N D I C A T O R S T R O N D H E I M T R O N D H E I M In Q1, Trondheim experienced a negative developmen t in RevPAR of 2,6% to NOK 502. The negative development is caused the shift of Easter from last year together with a decline in RevPAR in February. 12M rolling the Trondheim market has an increase in RevPAR of 7,5%. RevPAR increase in Trondheim is driven by an increase in ADR of 4,8% and increase in Occupancy of 2,6% the past year. Source: Benchmarking Alliance

10 C O M P A R I S O N C I T Y C O M P A R I S O N The six markets in this report act differently due to seasons as seen in the table on the left. Some markets are driven by Leisure and some by the Business and Conference segments. Tromsø is the only market in Q1 with a positive trend compared with same quarter last year. All the other markets has a negative RevPAR development in Q1 due to the shift in Easter compared with last year. Source: Benchmarking Alliance

11 N E W D E V E L O P E M E N T S O S L O R E G I O N Below is an overview of new developments in the Oslo Region. Most of the new capacity entering the market in 2018 is outside the city center, but in 2019 the new capacity entering the market has a prime location in the city center, close to the central station of Oslo.

12 N E W D E V E L O P E M E N T S O T H E R C I T I E S Below is an overview of new developments in the other markets mentioned in this report. As shown beneath, there is not a whole lot of new ongoing developmen ts. Both hotels in pipeline are hotels closed down for renovation and that will re -open.

13 T R A N S A C T I O N S S E L E C T E D T R A N S A C T I O N S Below is an overview of recent transactions in the Norwegian hotel market.

14 G L O S S A R Y O F T E R M S RevPAR - Room revenue per available room ADR - Average d aily rate OCC - Occupancy 12M - 12 months rolling performance SSB - Norwegian b u reau of n ation al statistics NOK - Norwegian Kron e

15 A B O U T U S N O R D I C H O T E L C O N S U LT I N G NHC was founded in 2004 and is the leading specialized hotel consultancy in Scandinavia, with offices in Norway, Denmark, Sweden, Finland and Iceland. Since being established, NHC has carried out a range of assignments for leading Nordic and international investors, developers, owners and banks including feasibility studies, appraisals, operator seraches, contract negotiations and transactions. NHC has in recent years advised on hotel transactions with an aggregate value in excess of 1 billion EUR across the Nordics. NHC Asset Management, a separate division under NHC, today asset manages 10 hotels and a total of more than rooms on behalf of leading investors. For additional information about NHC, please see our website: R E Y K J A V I K ABOUT BE NCHMARKI NG ALLIANCE Benchmarking Alliance is the leading provider of hotel, conference, F&B and spa benchmarking as well as hospitality market data for the Nordic hospitality industry. The company was created in 2010 by a team with broad background in hotels, real estate an d IT. COPYRIGHT H E L S I N K I This report is the property of NHC and may not be reproduced in parts or whole prior to the written consent of NHC. DISCLAIME R O S L O S T O C K H O L M NHC does not guarantee the accuracy of the data presented in this report and cannot be held liable here for any analysis, opinions or decisions derived from reading this report as it is solely at the responsibility of the reader to draw up conclusions. NHC cannot be held liable for any outcome of analysis, opinions and decisions formed based on the information presented in this report. NHC would like to inform the reader that the data from Benchmarkin g Alliance is collected in different ways and sometimes the figures can include provisions. This means that slight deviations in net ADR and RevPAR can occur. C O P E N H A G E N

16 C O N TA C T NHC Norway consists of Frederik Lindvik & Emil Tingulstad. If you have questions regarding this report or useful information to some of the sections, please do not hesitate to contact us. F R E D E R I K L I N D V I K Associate Partn er fl@nordichotelcon sultin g.com E M I L T I N G U L S T A D Associate Partn er et@nordichotelcon sultin g.com