Western Mass Outlook

1. Matthew R. Arrants Pinnacle Advisory Group 76 Canal Street Boston, MA 02114 Telephone: 617-722-9916 Fax: 617-722-9917 marrants@pinnacle-advisory.com Western Mass Outlook Pinnacle Realty Investments Pinnacle Advisory Group

2. Western Massachusetts Outlook • Market Overviews • Worcester • Springfield • Industry Trends • Regional Competitive Overview • Resort Industry Overview • Factors Affecting Demand • Pinnacle Projections • Worcester • Springfield • Berkshires

3. Worcester Performance Statistics

4. Worcester Occupancy1990 - 2002 Source: Pinnacle Advisory Group

5. Worcester Average Rate 1990-2002 Source: Pinnacle Advisory Group

6. Worcester RevPAR 1990 - 2002 Source: Pinnacle Advisory Group

7. Worcester Area • Supply Growth • 1998-2002 – 5.3% • Average Rate Growth • 1998-2002 - 3.4% • Average Market Occupancy • 1998-2002– 69%

8. Worcester – New Supply • Residence Inn – 124 Rooms 2004? • Convention Center Hotel – 200 Rooms - January 2005 • 4 Proposed hotels in Auburn???

9. Springfield Performance Statistics

10. Springfield Occupancy1990 - 2002 Source: Pinnacle Advisory Group

11. Springfield Average Rate 1990-2002 Source: Pinnacle Advisory Group

12. Springfield RevPAR 1990 - 2002 Source: Pinnacle Advisory Group

13. Springfield Area • Supply Growth • 1998-2002 - 1.6% • Average Rate Growth • 1998-2002 - 3.4% • Average Market Occupancy • 1998-2002– 65%

14. Springfield Area – New Supply • Springfield • Hilton Garden Inn–143 Rooms - Sept 2002 • Boutique Hotel–135 Rooms - April 2005 • West Springfield • Residence Inn–88 Rooms - January 2002 • Chicopee • Hampton Inn – 112 Rooms - September 2002 • Holyoke • Homewood Suites – 120 Rooms – Mid 2004?

15. Recent Industry Trends • Shortened Booking Window • Limited International Demand • Shorter Stays • Value Conscious Travelers • Increasing Use of the Internet

16. Regional Competitive Overview

17. Regional Competitive Overview • New England Mountains • Now a Four Season Destination • Cape and Islands • Holding Steady • Southeast Connecticut • A major new destination • Rhode Island • Growing as a Destination

18. Resort Industry Overview • Northeast • Holding Up Well • Southeast • Lack of International Demand • Caribbean and Central America • New Supply and Lack of Demand

19. Factors Affecting Demand • Terrorism • Fear of Flying • War in Iraq • Uncertainty • Economy • Lack of Corporate Demand • Consumer Confidence • Price Sensitivity

20. Regional Factors Affecting Demand • Weather • Boston Convention Demand • Corporate Demand • Transportation

21. Pinnacle Projections - Worcester • 2003 • Occupancy Down 2 – 4 points • Average Rate down 2 – 4 percent • 2004 • Occupancy up 0 - 2 points • Average Rate up 0 – 2 percent

22. Pinnacle Projections - Springfield • 2003 • Occupancy Flat – Up 2 points • Average Rate down 1 – 3 percent • 2004 • Occupancy up 0 – 2 percent • Average Rate - Flat

23. Pinnacle Projections - Berkshires • 2003 • Occupancy Up 0 – 2 points • Average Rate Up 1 – 3 Percent • 2004 • Occupancy - Flat • Average Rate – Flat – down 2 percent

24. Pinnacle Realty Investments Western Mass Outlook 2004 Rachel J. Roginsky, ISHC Pinnacle Advisory Group 76 Canal Street Boston, MA 02114 Telephone: 617-722-9916 Fax: 617-722-9917 rroginsky@pinnacle-advisory.com Pinnacle Advisory Group