Page 126 - ZaZa Q12021 Owners Meeting_Neat

CBRE HOTELS RESEARCH
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CBRE HOTELS RESEARCH Regional Economic Summary Hotel Market Summary
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H Hotel Horizons ® “Business contacts in the Sixth District indicated that Q4 2020 EDITION
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In 2020, Nashville hotels finished the year with a RevPAR
decline of 62.1%. This was the result of a decline in
economic activity continued to expand at a modest pace
from mid-November through December. Labor markets occupancy of 45.8% and a 30.1% decrease in average daily
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muted, on balance. Nonlabor costs related to construction
was greater than the national decline of 51.8%.
Regional Economic Summary and supply chains rose further over the reporting period. Nashville's upper-priced properties suffered the greatest
Hotel Market Summary
Although retail contacts reported overall holiday sales were
“Business contacts in the Sixth District indicated that In 2020, Nashville hotels finished the year with a RevPAR
decline in RevPAR during 2020. The properties in this
subdued, ecommerce activity remained strong. Auto dealers
economic activity continued to expand at a modest pace decline of 62.1%. This was the result of a decline in
category experienced a 63.8% drop in occupancy and a 18.5%
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noted sales declined since the previous report. Tourism and
from mid-November through December. Labor markets occupancy of 45.8% and a 30.1% decrease in average daily
decrease in ADR. Middle-priced hotels saw their RevPAR
hospitality activity softened. Residential real estate demand
continued to gradually improve, and wage pressures were room rates (ADR). The 62.1% decline in Nashville RevPAR
decline by 61.3% during the year, while lower-priced
remained strong, but challenges in commercial real estate
muted, on balance. Nonlabor costs related to construction was greater than the national decline of 51.8%.
markets persisted. Overall manufacturing activity rose
and supply chains rose further over the reporting period. properties experienced a RevPAR fall of 36.7%.
Although retail contacts reported overall holiday sales were Nashville's upper-priced properties suffered the greatest
moderately. Banking conditions remained stable, but some
Moving into 2021, Nashville RevPAR is expected to grow
subdued, ecommerce activity remained strong. Auto dealers decline in RevPAR during 2020. The properties in this
contacts noted an uptick in delinquencies, mostly with
45.1%. By year-end 2021, Nashville RevPAR will still be 45.0%
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residential mortgages.
noted sales declined since the previous report. Tourism and category experienced a 63.8% drop in occupancy and a 18.5%
less than the 2019 RevPAR level. RevPAR for Nashville hotels
hospitality activity softened. Residential real estate demand decrease in ADR. Middle-priced hotels saw their RevPAR
Travel and tourism activity softened since the previous
is not expected to surpass 2019 levels until 2024. For the
remained strong, but challenges in commercial real estate decline by 61.3% during the year, while lower-priced
report. Contacts noted that properties affected by recent
year, occupancy is forecast to grow by 44.6%, while average
markets persisted. Overall manufacturing activity rose properties experienced a RevPAR fall of 36.7%. room rates are projected to increase 0.3%.
hurricanes, primarily in Alabama, had not completed repairs
moderately. Banking conditions remained stable, but some Moving into 2021, Nashville RevPAR is expected to grow
as quickly as anticipated, which led to canceled reservations.
contacts noted an uptick in delinquencies, mostly with 45.1%. By year-end 2021, Nashville RevPAR will still be 45.0%
Drive-to destinations across the District continued to
residential mortgages. experience solid activity; however, some contacts anticipate
less than the 2019 RevPAR level. RevPAR for Nashville hotels
Travel and tourism activity softened since the previous is not expected to surpass 2019 levels until 2024. For the
that surges in COVID-19 cases would dampen demand in the
report. Contacts noted that properties affected by recent year, occupancy is forecast to grow by 44.6%, while average

near term..”
hurricanes, primarily in Alabama, had not completed repairs room rates are projected to increase 0.3%.
Federal Reserve Bank Beige Book, January 2021
as quickly as anticipated, which led to canceled reservations. 2020 Annual Change in RevPAR
Drive-to destinations across the District continued to
experience solid activity; however, some contacts anticipate
that surges in COVID-19 cases would dampen demand in the All Hotels Upper-Priced Mid-Priced Lower-Priced
near term..” Nashville: Next 4 Quarters
2020 Annual Change in RevPAR
Federal Reserve Bank Beige Book, January 2021 The arrows show the forecast direction of change over the next 4 quarters vs. the
previous 4 quarters. Green indicates the change will be above the long run average,
yellow indicates it will be the same, and orange indicates it will be below. -36.7%
All Hotels Upper-Priced Mid-Priced Lower-Priced
Nashville: Next 4 Quarters Occupancy
Occupancy will increase to 58.1%, better than the previous 4 quarters'
The arrows show the forecast direction of change over the next 4 quarters vs. the -62.1% -61.3%
rate of 40.2%, but below the long run average of 66.1%
previous 4 quarters. Green indicates the change will be above the long run average, -70.5%
yellow indicates it will be the same, and orange indicates it will be below. -36.7%
Average Daily Rate Source: Kalibri Labs, Q4 2020
Occupancy ADR growth expectations are increasing, positive 0.3% vs. the past 4 Annual Performance - Five Year History and Forecast
Occupancy will increase to 58.1%, better than the previous 4 quarters' -62.1% YEAR OCC Δ OCC ADR Δ ADR REVPAR Δ REVPAR
quarters' rate of negative 30.1%, but are below the long run average of -61.3%
rate of 40.2%, but below the long run average of 66.1% positive 1.7% -70.5% 2016 76.4% 2.4% $139.92 6.0% $106.90 8.5%
Revenue Per Available Room 2017 75.9% -0.7% $147.58 5.5% $111.97 4.7%
Average Daily Rate Source: Kalibri Labs, Q4 2020
RevPAR growth projections are climbing to 45.1% as compared to the
ADR growth expectations are increasing, positive 0.3% vs. the past 4 Annual Performance - Five Year History and Forecast 2018 74.1% -2.4% $152.19 3.1% $112.73 0.7%
past 4 quarters' rate of negative 62.1%, and are greater than the long
2019
quarters' rate of negative 30.1%, but are below the long run average of YEAR OCC Δ OCC ADR Δ ADR REVPAR Δ REVPAR 74.2% 0.1% $153.09 0.6% $113.54 0.7%
run average of positive 1.1%
positive 1.7% 2016 76.4% 2.4% $139.92 6.0% $106.90 2020 40.2% -45.8% $107.07 -30.1% $43.05 -62.1%
8.5%
Revenue Per Available Room Supply (orange indicates above long-term average) $147.58 5.5% $111.97 2021F 58.1% 44.6% $107.43 0.3% $62.45 45.1%
-0.7%
4.7%
75.9%
2017
Supply growth is less active, 5.4% vs. the past 4 quarters' rate of 6.1%, 3.1%
0.7%
RevPAR growth projections are climbing to 45.1% as compared to the 2018 74.1% -2.4% $152.19 $112.73 2022F 68.4% 17.7% $124.89 16.3% $85.49 36.9%
though it is greater than the long run average of 2.3%
past 4 quarters' rate of negative 62.1%, and are greater than the long 2019 74.2% 0.1% $153.09 0.6% $113.54 2023F 73.1% 6.8% $142.64 14.2% $104.30 22.0%
0.7%
run average of positive 1.1% 2020 40.2% -45.8% $107.07 -30.1% $43.05 2024F 74.6% 2.0% $154.94 8.6% $115.51 10.7%
-62.1%
45.1%
Supply (orange indicates above long-term average) Demand 2021F 58.1% 44.6% $107.43 0.3% $62.45 2025F 74.2% -0.5% $163.43 5.5% $121.18 4.9%
Forecast demand growth is climbing, positive 52.4% vs. the past 4
Supply growth is less active, 5.4% vs. the past 4 quarters' rate of 6.1%, 2022F 68.4% 17.7% $124.89 16.3% $85.49 Long Run Averages 2000 to 2020
36.9%
though it is greater than the long run average of 2.3% quarters' rate of negative 42.5%, and is greater than the long run 14.2% $104.30 22.0%
2023F
$142.64
73.1%
6.8%
10.7%
average of positive 0.8% 2024F 74.6% 2.0% $154.94 8.6% $115.51 Occupancy: 66.1%, ADR Change: 1.7%, RevPAR Change: 1.1%
Demand 2025F 74.2% -0.5% $163.43 5.5% $121.18 4.9% Source: CBRE Hotels Research, Kalibri Labs, Q4 2020
Forecast demand growth is climbing, positive 52.4% vs. the past 4 Long Run Averages 2000 to 2020
quarters' rate of negative 42.5%, and is greater than the long run 126
HO TEL ZAZA + ZAZA HO SPIT ALITY | 20 21 MARCH YTD
average of positive 0.8% Occupancy: 66.1%, ADR Change: 1.7%, RevPAR Change: 1.1%
Source: CBRE Hotels Research, Kalibri Labs, Q4 2020