Global Travel, Trends and Initiatives July 29, 2010

1. Global Travel, Trends and Initiatives July 29, 2010

2. Good Morning Ladies and Gentlemen A little more than 100 years ago, on January 31, 1910

4. Serving the hospitality industry for a century • Sole national organization in the United States • Represents all sectors and stakeholders, • Provides members with: • National advocacy on Capitol Hill • Education • Research and information • Bottom-line savings

5. Scholarships - Research – Work Force Development

6. World’s leading supplier of hospitality training, certification, text books and curriculum

7. “May you live in interesting times.”

8. After five years unprecedented growth… • 2007 credit crisis • Lehman Brothers collapse in September 2008 • Decline in financial resources, bad press • Bankruptcy • Business dwindled in resort areas • Perception became reality

9. Businesses eliminated travel.

10. American Lodging Investment Summit and NYU Investment Conference • Cautiously optimistic in January • Greater optimism in June • Streamlining budgets, cutting staff and revising service protocols • Increased forecasts for this year and next

11. Smith Travel Research2010 • Supply growth will be only 2% • Demand growth will be 5.7% • Occupancy will be 56.7%, an increase of 3% over 2009 • Average daily rate, will decrease but only by .6% to $97.26

12. 2011 Smith Travel Research projects increases in all three key performance metrics during 2011. • Occupancy is projected to increase 2.5% to 58.1% • ADR is forecasted to rise 3.9% to US$101.05 • RevPAR is expected to grow6.5% • Supply is projected to grow by just .6%, with demand increasing 3.1%

13. Vital Industry • 49,000 lodging properties in the United States • 4.7M rooms with $140.6B in sales • Employs approximately 1.8M workers at properties • Supports more than 7.5M jobs

14. Industry Employment • The hotel industry in the United States alone will need 300,000 additional employees by 2014. • The United States Travel Association forecasts the U.S. travel industry will add 90,000 American jobs this year. • The industry is responsible for generating one in every 12 jobs. That’s 250M jobs or 8.4% of the total global employment. • The figures will rise to nearly 300M in a decade.

15. International Travel • International visitor arrival growth has been down for the past two years. • International tourist arrivals fell by 4% in 2009. • 2% increase in the last quarter of last year could indicate change for the positive. • International tourism is rebounding from 2009, led by Africa and Asia.

16. Asia • Asia and the Pacific had strongest first quarter growth this year, up 10% • Destinations in Southeast Asia had highest increases in year-over-year tourism, with an average collective gain of 16% • Arrivals to Cambodia, Indonesia, Myanmar, Singapore and Vietnam

17. Africa and Middle East • Up 7% in first three months of the year • Africa and Middle East reporting favorable results in occupancy, ADR and RevPAR • In 2010, the ADR has increased 1.3% and RevPAR up 2.1% • Egypt, Jordan, Dubai had an 8.1% increase • Abu Dhabi reported the largest decreases in all three key metrics

18. Europe • German reporting 3.4% increase in occupancy • Italy and Spain, occupancy is up nearly 10% • In the United Kingdom, occupancy is up 6.5% and ADR is up 4.1% • Athens reported largest occupancy decrease • Birmingham, England and Tel Aviv, Israel both saw ADR increase of more than 20%

19. Recovery • The International Monetary Fund growing faster than expected • International tourism arrivals of 3 to 4% • Asia is expected to rebound faster • Americas and Europe to recover at more moderate pace • Middle East and Africa will have strong growth • Long-term job potential is strong • Expected 67.2M new jobs created worldwide by 2020

20. BRIC Countries • Brazil, Russia, China and India have increased middle class resulting in strong demand for internal and international travel • By 2015, 400M Chinese and Indians will have sufficient incomes to travel abroad • China and India are focal points of international hotel industry

21. BRIC Countries • U.S. has 4.5M hotel rooms • China has 1.6M hotel rooms • India has 112-thousand rooms • China is still underdeveloped • India in dire need of more hotel rooms, especially mid-priced facilities

22. BRIC Countries • China will be the number one market for inbound tourism and number four in terms of outbound travelers • China’s business travelers love to travel and even extend their trips for leisure • Nearly every hotel company is announcing dozens of new projects in China each year • 81% of Chinese business travels are optimistic

23. BRIC Countries • China has a strong economy • China sustained economic growth • India is forecasted to have 50M outbound tourists by 2020 • Brazil will host the World Cup in 2014 and the Olympics in 2016

24. United States Visa Policy • Need to streamline visa process in all countries • China has only four consulates that can issue visas; Brazil seven • Need to make it easier for people to come here

25. Travel Promotion Act • March 4, President Obama signed the Travel Promotion Act • Creating a public private partnership to create a $100M international advertising and educational campaign • Funded by a $10 fee imposed on foreign visitors from Visa Waiver countries. • Create $4B in new spending and drive $321M in new federal tax revenue

26. Technology and environment are two key issues

27. Technology • Internet has forever changed how hoteliers do business • Facebook, blogs, Twitter or TripAdvisor provide new methods of two-way interaction between consumer and property • Where’s Joe? • Mobile marketing has become increasingly important • By 2014, 1B people will have smart phones • E.I. is now using “aps” very effectively

28. Environment • Tourisms position at the forefront of climate change • Green jobs and environmentally friendly infrastructure can lead to the transformation to the green economy • AH&LA is doing our part to promote green • AH&LA launched Green Guidelines January 2009 • On Earth Day, this past April we launched the Energy Slasher Challenge • We have partnered with Green Key Global, Eco-rating Program

29. Advocacy • Democratic party controls the House, the Senate and White House • AH&LA’s governmental affairs staff are joining coalitions, working on more than 100 pieces and working on regulatory issues each day. • Card check • Health care • Immigration • Tax issues

30. Advocacy • Our Legislative Action Summit in March made a difference • 300 members visited Capitol Hill • Priorities we took to the Hill • ensuring fairness in hotel room taxation • keeping democracy strong at the workplace • supporting health care reform that works

31. Diversity • Women comprise more than 40% of the business travelers • AH&LA’s Women In Lodging Connect has 670 members • Under 30 Gateway Council has 672 members • Student Chapters, 1,811 members • Cultivating tomorrow’s leaders in the growing and diversifying hospitality community is a top priority for the association

32. If I can ever be of assistance, contact me at: joe@ahla.com or (202) 289-3111

33. Thank You God Bless America