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HOTEL HORIZONS ® Q4 2020 EDITION Nashville, TN
Nashville Market Profile Total Room Supply: 47,544 NEW DEVEL OPMENT
CBRE HOTELS RESEARCH
Nashville Top Brands
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H Hotel Horizons ® Upper-Priced Properties Rooms % Mkt Mid-Priced Q4 2020 EDITION Lower-Priced Properties Rooms % Mkt
Properties
Rooms % Mkt
Gaylord 2 3,191 6.7% Holiday Inn Express 18 2,037 4.3% InTown Suites 6 757 1.6%
Embassy Suites 4 1,037 2.2% Hampton Inn Suites 13 1,586 3.3% Extended Stay America 7 755 1.6%
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N NASHVILLE, TN Marriott 3 999 2.1% Courtyard 10 1,377 2.9% Quality Inn 10 754 1.6%
4
987
2.1%
Regional Economic Summary Hilton Hotel Market Summary Residence Inn 9 8 1,154 2.4% Days Inn 10 721 1.5%
2
Hilton Garden Inn
1.9%
9
Super 8
1.3%
597
892
Sheraton Hotel
2.3%
1,089
“Business contacts in the Sixth District indicated that In 2020, Nashville hotels finished the year with a RevPAR
Source: Kalibri Labs, Q4 2020
economic activity continued to expand at a modest pace decline of 62.1%. This was the result of a decline in
from mid-November through December. Labor markets occupancy of 45.8% and a 30.1% decrease in average daily Lower-Priced Unclassified / Independent
Supply Pipeline
Upper-Priced
Mid-Priced
continued to gradually improve, and wage pressures were room rates (ADR). The 62.1% decline in Nashville RevPAR
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Project Phase
Properties
Rooms % Mkt
Properties
Rooms
muted, on balance. Nonlabor costs related to construction was greater than the national decline of 51.8%. % Mkt Properties Rooms % Mkt Properties Rooms % Mkt
Planning
and supply chains rose further over the reporting period. 5 565 1.2% 16 1,936 4.1% 15 2,179 4.6% 11 2,155 4.5%
Final Planning/Bidding Nashville's upper-priced properties suffered the greatest
Although retail contacts reported overall holiday sales were 4 720 1.5% 12 1,490 3.1% 7 1,031 2.2% 0 0 0.0%
3.0%
12
Underway
1,427
5
1,592
subdued, ecommerce activity remained strong. Auto dealers decline in RevPAR during 2020. The properties in this 3.3% 3 431 0.9% 1 45 0.1%
40
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5,018
10.6%
2,712
Total
14
5.7%
noted sales declined since the previous report. Tourism and category experienced a 63.8% drop in occupancy and a 18.5% 25 3,641 7.7% 12 2,200 4.6%
Source: Dodge, CBRE Hotels Research, Q4 2020
hospitality activity softened. Residential real estate demand decrease in ADR. Middle-priced hotels saw their RevPAR
remained strong, but challenges in commercial real estate decline by 61.3% during the year, while lower-priced
Pipeline Status Definitions
markets persisted. Overall manufacturing activity rose properties experienced a RevPAR fall of 36.7%.
moderately. Banking conditions remained stable, but some Moving into 2021, Nashville RevPAR is expected to grow
PHASE
DEFINITION
contacts noted an uptick in delinquencies, mostly with 45.1%. By year-end 2021, Nashville RevPAR will still be 45.0%
Planning
Projects reported at the planning stage have an architect associated with them who is starting to draw the schematic plans for the building. Projects in this stage are closer to
residential mortgages. less than the 2019 RevPAR level. RevPAR for Nashville hotels
ground breaking but still have a fairly low probability of starting.
Travel and tourism activity softened since the previous is not expected to surpass 2019 levels until 2024. For the
At this stage, plans for a project have been or are about to be finalized. The project is moving towards final approvals. Once a project has reached the final planning stage, there is
Final Planning
report. Contacts noted that properties affected by recent year, occupancy is forecast to grow by 44.6%, while average
a high probability that the construction contract will be awarded within the next six months.
hurricanes, primarily in Alabama, had not completed repairs room rates are projected to increase 0.3%.
Once the plans for the project have been finalized, the project is put out to bid by general contractors. At this stage in the planning cycle, projects are very close to being awarded
Bidding
as quickly as anticipated, which led to canceled reservations. and have a very high probability of coming to market.
Drive-to destinations across the District continued to
Underway
experience solid activity; however, some contacts anticipate Projects that are under construction.
that surges in COVID-19 cases would dampen demand in the
near term..” Source: Dodge, Q4 2020
Federal Reserve Bank Beige Book, January 2021 2020 Annual Change in RevPAR
All Hotels Upper-Priced Mid-Priced Lower-Priced
Nashville: Next 4 Quarters
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%
Occupancy
Occupancy will increase to 58.1%, better than the previous 4 quarters' -62.1% -61.3%
rate of 40.2%, but below the long run average of 66.1% -70.5%
Average Daily Rate Source: Kalibri Labs, Q4 2020
ADR growth expectations are increasing, positive 0.3% vs. the past 4 Annual Performance - Five Year History and Forecast
quarters' rate of negative 30.1%, but are below the long run average of YEAR OCC Δ OCC ADR Δ ADR REVPAR Δ REVPAR
positive 1.7% 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%
RevPAR growth projections are climbing to 45.1% as compared to the 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 74.2% 0.1% $153.09 0.6% $113.54 0.7%
run average of positive 1.1% 2020 40.2% -45.8% $107.07 -30.1% $43.05 -62.1%
Supply (orange indicates above long-term average) 2021F 58.1% 44.6% $107.43 0.3% $62.45 45.1%
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 36.9%
though it is greater than the long run average of 2.3% 2023F 73.1% 6.8% $142.64 14.2% $104.30 22.0%
2024F 74.6% 2.0% $154.94 8.6% $115.51 10.7%
Demand 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 Long Run Averages 2000 to 2020 P. 11 / CBRE HOTELS RESEARCH
quarters' rate of negative 42.5%, and is greater than the long run 128
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