Ireland Revenue Forum 27 th June 2017 Sarah Duignan Director, Client Relationships sduignan@str.com @SarahDuignanSTR 2016 STR, Inc. All Rights Reserved. Any reprint, use or republication of all or a part of this presentation without the prior written approval of STR, Inc. or STR Global, Ltd. trading as STR (collectively STR ) is strictly prohibited. Any such reproduction shall specifically credit STR as the source. This presentation is based on data collected by STR. No strategic advice or marketing recommendation is intended or implied.
Your Contacts Aoife Roche Director, Account Management aroche@str.com George Titlow Business Development Manager, UK & Ireland gtitlow@str.com Sarah Duignan Director, Client Relationships sduignan@str.com Agnieszka Stopa Regional Account Manager, UK, Ireland & Poland astopa@str.com
STR, collecting data since 1985 Performance Reports Occ, ADR, RevPAR Supply/Demand Revenue P&L Supply Reports Existing supply Future supply Pipeline Characteristics Forecast Reports Main KPIs Macro economic input Micro economic input 5 years/6 quarters/18 months STR Coverage Our Sample +57K Hotels +7.7M Hotel Rooms +182 Countries +2K Markets
STR Coverage Our Sample Hotels & Hotel Rooms, May 2017 +35.6K +4,206K +1.2K +187K +10.0K +1,372K +841 +149K +844 +209K +8.6K +1,617K Hotels Rooms
Global RevPAR % Change USD, Europe in EUR, Constant Currency, May 2017 YTD North America +3.3% Central America +4.4% Northern Africa +42.0% Europe +6.5% Middle East Asia -4.8% +2.4% South America -5.8% Southern Africa +4.5% Australia & Oceania +3.5%
Demand outpacing supply, for the most part Global Supply & Demand % Change May 2017 YTD Supply Demand 6.2% 5.0% 4.2% 5.1% 4.5% 5.4% 1.8% 2.5% 3.1% 2.0% 1.4% 3.0% 1.9% 2.4% 0.7% 0.8% North America & Caribbean Central America South America Europe Middle East Africa Asia Australia & Oceania
Strong start to 2017 for Europe Europe Main KPIs EUR, CC, May 2017 YTD 67.7% 105.4 71.3 Occupancy ADR RevPAR +3.4% +3.0% +6.5%
Europe Main KPIs % Change What s driving growth? EUR, CC, May 2017 YTD +6.5% +7.4% +4.2% +3.4% +3.0% +0.8% Supply Demand Occupancy ADR RevPAR Revenue
Dublin continues to offer good value for money European Cities Occupancy, ADR, RevPAR EUR, May 2017 YTD 85% 80% 75% 70% 65% 60% 55% 50% 45% 40% ADR RevPAR Occupancy 250 200 150 100 50 0
A much better picture compared to this time last year Europe RevPAR % Change LC, May 2017 YTD Helsinki 4 9 St. Petersburg 18 Edinburgh 10 Copenhagen 0 Moscow Dublin 7 Amsterdam 9 London 11 14 Brussels 5 Berlin 13 14 Prague Warsaw 25 Kiev Paris 12-6 6 Vienna Zurich Budapest 14 5 Bucharest Barcelona 14 Lisbon 20 14 Madrid Rome 1 24 Belgrade 12 Athens -1 Istanbul
Ireland -Main KPIs EUR, CC, May 2017 YTD 73.2% 119.38 87.33 Occupancy ADR RevPAR +1.5% +6.3% +7.8%
Ireland Main KPIs % Change What s driving growth? EUR, CC, May 2017 YTD +7.8% +8.6% +6.3% +0.7% +2.2% +1.5% Supply Demand Occupancy ADR RevPAR Revenue
Occupancy trending similarly across Ireland Monthly Occupancy January 2015 YTD May 2017 YTD 90% Ireland All Reg Ireland Dublin 80% 70% 60% 50% 40% 30% 20% Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec Jan Feb Mar Apr May
Regional Ireland picking up the pace Monthly ADR EUR, January 2015 YTD May YTD 2017 Ireland All Reg Ireland Dublin 140 120 100 80 60 40 Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec Jan Feb Mar Apr May
Irish Markets Occupancy, ADR, RevPAR EUR, YTD May 2017 ADR RevPAR Occupancy 85% 80% 75% 70% 65% 60% 55% 50% 45% 40% 140 120 100 80 60 40 20 0 2016 STR. All Rights Reserved.
Irish Markets RevPAR % Change EUR, CC, May 2017 YTD NW Ireland +8.2% Sligo +4.4% Belfast +22.6% Dublin +6.5% Reg Ireland +9% Ireland +7.8% Leinster Reg +8.7% Kilkenny +12.4% Kerry +11.3% Munster Reg +11.9% Cork +5.5% 2016 STR. All Rights Reserved.
ADR % Chg Irish Markets Performance RevPAR positioning 2017 Occ and ADR % change May 2017 YTD 12 10 Kerry Munster Regional 8 6 4 Cork Dublin Ireland Ireland Regional Leinster Regional North West Ireland Kilkenny 2 0-2 0 2 4 6 8 10 Occ % Chg
Dublin Supply, Demand % Change, RevPAR Actuals EUR, CC, May 2011 YTD May 2017 YTD Supply % change Demand % change RevPAR 15% 2011 2012 2013 2014 2015 2016 2017 120 10% 100 80 5% 60 0% 2011 2012 2013 2014 2015 2016 2017 40 20-5% 0
Dublin Monthly Occupancy January 2015 YTD May 2017 YTD 90% 2015 2016 2017 85% 80% 75% 70% 65% 60% January February March April May June July August September October November December
Dublin Monthly ADR EUR,CC, January 2015 YTD May 2017 YTD EUR 140 2015 2016 2017 EUR 130 EUR 120 EUR 110 EUR 100 EUR 90 EUR 80 EUR 70 January February March April May June July August September October November December
Dublin YTD May 2017 EUR, CC, May 2017 YTD 78.3% 127.83 100.08 Occupancy ADR RevPAR +0.7% +5.7% +6.5%
Dublin Main KPIs % Change What s driving growth? EUR, CC, May 2017 YTD +8.7% +5.7% +6.5% +2.0% +2.8% +0.7% Supply Demand Occupancy ADR RevPAR Revenue
Day Count Compression analysis Dublin May 2017 YTD 60 50 40 30 20 10 0 41% 19% 160 140 120 100 80 60 40 20 0 <70 >=70<80 >=80<90 >=90 Occupancy (%) Day Count ADR (EUR)
Dublin & Regional Ireland Occ, ADR & RevPAR Dublin & Regional Ireland, ADR & RevPAR, 2013 May 2017 YTD 140 120 100 80 60 40 20 0 ADR RevPAR Occupancy 90% 80% 70% 60% 50% 40% 30% 20% 10% %
Market Class Dublin & Regional Ireland - Occ, ADR & RevPAR RevPAR% change YOY EUR, May 2017 YTD Dublin Regional Ireland 90% 80% 70% +6.9 +4 +5.3 +14.6 +9.3 +11 +12.4 +4.5 +6.2 +14.1 250 200 60% 50% 150 40% 30% 100 20% 50 10% 0% Luxury Upper Upscale Upscale Upper Midscale Midscale & Economy Occ ADR RevPAR Luxury Class Upper Upscale Class RevPAR % change Upscale Class Upper Midscale Class Midscale & Economy Classes 0
Dublin & Belfast Occ, ADR & RevPAR Dublin & Belfast Occ, ADR & RevPAR, 2013 May 2017 YTD 140 120 100 80 60 40 20 0 ADR RevPAR Occupancy 90% 80% 70% 60% 50% 40% 30% 20% 10% %
Market Class Dublin & Belfast - Occ, ADR & RevPAR RevPAR% change YOY EUR, May 2017 YTD Dublin Belfast 90% 80% 70% +6.9 +4 +5.3 +14.6 +9.3 +21.4 +21.4 +31.1 +22.6 250 200 60% 50% 150 40% 30% 100 20% 50 10% 0% Luxury Upper Upscale Upscale Upper Midscale Midscale & Economy Upper Upscale Upscale Upper Midscale Midscale & Economy 0 Occ ADR RevPAR RevPAR % change
Dublin Transient, Group and Contract RevPAR % Change Dublin May 2017 YTD 2016 2015-15% -10% -5% 0% 5% 10% 15% 20% 25% 30% 35% Contract Group Transient
Dublin submarkets Occupancy, ADR, RevPAR EUR, May 2017 YTD 85% 80% 75% 70% 65% 60% 55% 50% 45% 40% ADR RevPAR Occupancy 160 140 120 100 80 60 40 20 0 2016 STR. All Rights Reserved.
Dublin submarkets Occ, ADR & RevPAR % change May 2017 YTD 9% 8% 7% 6% 5% 4% 3% 2% 1% % -1% -2% Occupancy ADR RevPAR Dublin Airport Dublin City Centre Dublin surroundings 2016 STR. All Rights Reserved.
Occupancy % Day of Week Analysis Actuals Dublin May 2017 YTD 90.0 80.0 70.0 60.0 50.0 40.0 30.0 20.0 10.0 0.0 160 140 120 100 80 60 40 20 0 ADR (EUR) RevPAR (EUR) Occupancy
% Change Day of Week Analysis % Chg Dublin May 2017 YTD 10.0% 8.0% 6.0% 8.1% 8.7% 9.3% 6.3% 7.2% 7.4% 6.5% 4.0% 2.0% 0.0% -2.0% -1.3% -4.0% Occupancy ADR RevPAR
STR Forecast Methodology
Forecast Partners Tourism Economics Part of Oxford Economics Focus on quantitative analysis of the travel industry Custom market strategies, industry forecasts, policy analysis and economic impact studies. Oxford Economics has outperformed other macro forecasters Oxford Economics Forecast Performance compared 2008-2012 (average absolute forecast divergence for real GDP growth) US Eurozone UK Japan Oxford Economics 1.0 1.1 1.4 2.3 EIU 1.1 1.8-2.6 Global Insight 0.9 1.2 1.4 2.5 IMF 1.4 1.9 2.1 2.8 OECD 1.0 1.6 1.5 3.4 Consensus Economics 1.1 1.2 1.4 2.4 Note: Forecast made in December for year ahead
STR Hotel Market Forecast Model Methodology Economic Drivers GDP - Market - Country - International Room Supply Occupancy Net Wealth Company Profits Unemployment Exchange Rate Inflation + Market Events Room Demand (Demand / Supply Ratio) ADR Dashed line indicates lagged relationship
Demand Model No 1 Factors influencing demand Dublin, May 17 Report Economics Drivers Events Reliability Seasonal Patterns
STR Forecast Model into practice ADR model
2017 Timeline March Article 50 Dutch Elections May Emmanuel Macron June Theresa May Leo Varadkar Aug-Oct German Elections FEB MAY AUG NOV Reports are updated 4 times a year (Feb, May, Aug, Nov) To keep track of changes in macroeconomic scenario
2017- Tourism arrivals are expected to grow Europe Forecast Arrivals and % change for 2017 +1.9% Ireland 10.7m (+1.7%) UK, US, DE, FR, ES UK 37.6m (+5.1%) FR, US, DE, IR, ES Portugal 11.7m (+4.5%) ES, UK, FR, DE, NE France 82.9m (2.2%) UK, DE, BE, IT, ES Germany 36.5m (+2.6%) NE, CH, US, UK, AU Italy 54.5m (+3.6%) DE, FR, UK, AU, CH Poland 18.0m (+17.2%) DE, UK, US, UA, RU
2017- Ireland: Top 5 Arrival Source Destinations Number of estimated international arrivals in thousands 6,0000 8.7% 5,0000 0 4,000 0 3,000 0 2,000 0 1,000 0 0 4.6% 3.4% 2.7% -1.3% 5,282 1,472 653 519 381 United Kingdom United States Germany France Spain Source: Tourism Economics
What to expect in 2017
Dublin occupancy to saturate, ADR to drive performance Annual ADR and Occupancy, 2005-2021, May 2017 Report 160 150 140 130 Dublin 2016 2021 110 105 100 Reg Ireland 2017 YTD 2016 120 95 110 2006 100 90 80 2011 70 55% 65% 75% 85% 95% 90 2006 85 80 2011 75 50% 60% 70%
Belfast still suffering from a rate perspective Annual ADR and Occupancy, 2006-2021, May 2017 Report 160 150 Dublin 2021 80 Belfast 140 75 130 2016 120 110 2006 100 90 80 2011 70 55% 65% 75% 85% 95% 70 2017 YTD 2016 65 2006 60 55 50 2011 55% 65% 75% 85%
Dublin s Current and Future Supply
Quarterly forecast for Dublin Quarterly ADR and Occupancy, 2016-2018, May 2017 Report 90% 85% 80% 75% 70% 65% 60% 55% 50% 45% 40% ADR RevPAR Occupancy 160 140 120 100 80 60 40 20 0 2016 STR. All Rights Reserved.
Quarterly forecast for Dublin Quarterly ADR and Occupancy, 2016-2018, May 2017 Report 25% 20% Occ % chg ADR % chg 15% 10% 5% 0% -5%
Thank You! Sarah Duignan Director Client Relationships sduignan@str.com +44 77 857 15976 @SarahDuignanSTR 2017 STR, Inc. All Rights Reserved. Any reprint, use or republication of all or a part of this presentation without the prior written approval of STR, Inc. or STR Global, Ltd. trading as STR (collectively STR ) is strictly prohibited. Any such reproduction shall specifically credit STR as the source. This presentation is based on data collected by STR. No strategic advice or marketing recommendation is intended or implied.