Quantifying the Rental Condominium Segment of the Hospitality Industry

1. Quantifying the Rental Condominium Segment of the Hospitality Industry Quantifying the Rental Condominium Segment of the Hospitality Industry Funded by: American Hotel & Lodging Educational Foundation For the American Hotel & Lodging Association November 2002 Slide #1: Welcome to our presentation. I am here to present the results of a two year study funded by the American Hotel & Lodging Educational Foundation as requested by the Condominium Committee of the American Hotel & Lodging Association.Slide #1: Welcome to our presentation. I am here to present the results of a two year study funded by the American Hotel & Lodging Educational Foundation as requested by the Condominium Committee of the American Hotel & Lodging Association.

2. Quantifying the Rental Condominium Segment of the Hospitality Industry Principal Investigators Pilot Study: Ed Merritt, California Polytechnic Institute Hawaii: Glenn Nakamura Colorado: Robert Benton, Robert S. Benton & Associates Mississippi/Alabama: Douglas Viehland Oregon/Washington: Douglas Viehland Compilation of Results: Douglas Viehland Staff Liaisons AH&LA: Taffy Davies, Director Member and State Relations AH&LEF: Michelle Poinelli, Director of Foundation Programs Slide #2: I am presenting the research results of a team of researchers. These results compile the individual work and individual research papers of this team. During the entire project, the research benefited from the assistance of key staff from the AH&LA and the AH&LEF. Slide #2: I am presenting the research results of a team of researchers. These results compile the individual work and individual research papers of this team. During the entire project, the research benefited from the assistance of key staff from the AH&LA and the AH&LEF.

3. Quantifying the Rental Condominium Segment of the Hospitality Industry AH&LA Condominium Committee Verlin Abbott Cendant Robert Buntz Bluefin Bay on Lake Superior James Burke The Collins School of Hospitality Management John Curry The Curry Company Sharon Drechsler Concord Servicing Corporation Terri Haack Kingsmill Resort & Conference Center Jack Healan Amelia Island Plantation Michael Justin Mountain Management Services Ilene Kamsler Colorado Hotel & Lodging Association Roy Kennington Educational Institute of the AH&LA Randi Kirshbaum American Express Establishment Services Edward Merritt California State Polytechnic University John Munro Sea Pines Resort Glenn Nakamura Hawaiian Islands Hospitality Group Jack Rush Port Royal Ocean Resort Condominiums John Russell Hospitality Artists, LLC James Scavo Weinstock & Scavo, P.C. Joe Shackleton Beaver Run Resort Breckenridge Andre Tatibouet Aston Hotels & Resorts International Louis Ventresca The Sherry-Netherland New York Slide #3: The origin of this study was a request of the Condominium Committee of the AH&LA. It was this Committee that reviewed the progress of the research including approval of the presentation you will view today. Follow-up work will be an activity of this Committee. I cite the specific work of Pedro Mandoki who was chairman when this project was initiated during Phase I. Also, Jim Burke and Michael Justin who were members of the ad hoc committee reviewing and supporting the research activities in the second phase of this study. Slide #3: The origin of this study was a request of the Condominium Committee of the AH&LA. It was this Committee that reviewed the progress of the research including approval of the presentation you will view today. Follow-up work will be an activity of this Committee. I cite the specific work of Pedro Mandoki who was chairman when this project was initiated during Phase I. Also, Jim Burke and Michael Justin who were members of the ad hoc committee reviewing and supporting the research activities in the second phase of this study.

4. Quantifying the Rental Condominium Segment of the Hospitality Industry Timeline of Study�Phase I April 2000 � Request for study approved by Condominium Committee November 2000 � Pilot Study Approved by American Hotel & Lodging Foundation April 2001 -- AH&MA name changed to AH&LA reflecting broadening of scope of envisioned activities. June 2001 --- Pilot Study Completed. November 2001�Up to five additional studies authorized by AH&LF. Slide #4: I mentioned a two-year study outlined in two phases. The principal activity in Phase I was the pilot study conducted in California. Other important activities set the stage for Phase II. This included the endorsement by what was then the American Hotel & Motel Association of a name change to broaden the opportunity for memberships such as condominiums. Also, the decision by the AH&LEF that there would be a Phase II.Slide #4: I mentioned a two-year study outlined in two phases. The principal activity in Phase I was the pilot study conducted in California. Other important activities set the stage for Phase II. This included the endorsement by what was then the American Hotel & Motel Association of a name change to broaden the opportunity for memberships such as condominiums. Also, the decision by the AH&LEF that there would be a Phase II.

5. Quantifying the Rental Condominium Segment of the Hospitality Industry Timeline of Study�Phase II April 2002 � Condo Committee selects locations for additional studies and taskforce to meet during 2002 to monitor progress. Summer 2002�Studies conducted in Hawaii, Colorado, Oregon, Washington, Alabama and Mississippi. September 2002 -- Final studies submitted and preparation of compilation authorized. November 2002 � Final report submitted to Foundation and to AH&LA Condo Committee. Slide # 5: The bulk of what is presented today is from Phase II with conduct of studies in six states listed in the second bullet. The scope of work was enlarged to more clearly assure the original purposes of the study would be achieved.Slide # 5: The bulk of what is presented today is from Phase II with conduct of studies in six states listed in the second bullet. The scope of work was enlarged to more clearly assure the original purposes of the study would be achieved.

6. Quantifying the Rental Condominium Segment of the Hospitality Industry Purpose of Study Identify the extent that condominiums are used for transient guest rental. Determine various methodologies to be used by AH&LA member state associations to identify condominiums for transient guest rental in their states. Develop a database of condominiums available for transient guest rental in targeted states. Slide #6: The purpose of the study from the beginning was�(read from slides)Slide #6: The purpose of the study from the beginning was�(read from slides)

7. Quantifying the Rental Condominium Segment of the Hospitality Industry Purpose of Study Quantify the number of condominium units available for transient guest rental in the area in contrast to the number of hotel rooms. Quantify the number of AH&LA members in contrast to the number of non-AH&LA members in the condominium units identified. Analyze the potential for AH&LA membership in the condominium segment with recommendations to AH&LA and member state associations. Slide #7: Continuing on...�(read from slides)Slide #7: Continuing on...�(read from slides)

8. Quantifying the Rental Condominium Segment of the Hospitality Industry Purpose of this Presentation Provide results in graphic and lecture format for presentation to a variety of audiences. Provide a basis for interested parties to compare their operations. Inform member state associations on the potential for membership in this segment. Complete copies of the five submitted reports are available at www.ahla.com\?????. Slide #8: There was a deliberate attempt to prepare the final results in this format. It is a graphic presentation supplemented by a prepared script that lends itself to forty-five minute presentation to an audience or may be viewed by an individual. It enables those viewing the presentation to think about the operations of condominiums and how that impacts their operations. It will inform member state associations about the potential for membership in this segment. However, those that want to see the details are welcome to secure the five individual reports prepared by the team. They can be secured by accessing the Web site mentioned at the bottom of this slide that will be repeated at the end of this presentation.Slide #8: There was a deliberate attempt to prepare the final results in this format. It is a graphic presentation supplemented by a prepared script that lends itself to forty-five minute presentation to an audience or may be viewed by an individual. It enables those viewing the presentation to think about the operations of condominiums and how that impacts their operations. It will inform member state associations about the potential for membership in this segment. However, those that want to see the details are welcome to secure the five individual reports prepared by the team. They can be secured by accessing the Web site mentioned at the bottom of this slide that will be repeated at the end of this presentation.

9. Quantifying the Rental Condominium Segment of the Hospitality Industry Definition of Condominium A condominium for the purposes of this study is a dwelling that is owned by an individual or corporation who is a member of a mandatory membership association comprised of all owners within the same development. The dwelling is made available for guest rental for a period of less than 30 days. It is part of a larger complex of similarly situated units. It is not used as timeshare or fractional interest. Slide #9: As we move away from the history and background of the research, we look at the work to define the entity we are to quantify. In turn, this helps educate the industry and those who see this presentation of some of the characteristics of these entities and the definition used in this study. (read definition from slide) This would include townhouses or vacation homes only if they were part of a large complex typically with existence of a very structured homeowners association. Slide #9: As we move away from the history and background of the research, we look at the work to define the entity we are to quantify. In turn, this helps educate the industry and those who see this presentation of some of the characteristics of these entities and the definition used in this study. (read definition from slide) This would include townhouses or vacation homes only if they were part of a large complex typically with existence of a very structured homeowners association.

10. Quantifying the Rental Condominium Segment of the Hospitality Industry Condominium Characteristics Bylaws of homeowners association will permit rental of less than 30 days. Common practice for rental is a minimum number of days such as three nights. Located in resort destination area such as coastal, ski, lake recreational areas. Not located in urban or roadside markets. Available for rental through the onsite manager or a realty company. Slide #10: Next, we look at some of the characteristics of condominiums that were part of the study bearing in mind there are some variations and exceptions to each characteristic. The bylaws must permit rental for less than 30 days. Many room taxes and state laws distinguish transient guest rental from residential use or apartment use on the nature of the rental period. Homeowners who want a residential environment require a 30 or more day requirement to discourage transient guest rental, especially in vacation areas. Many times the rental for these units were more less than an extended stay, but more than the nightly stay typical of a hotel or motel experience. As a vacation destination, weekend or weekly use is very common and that is often a minimum stay requirement in condos. The units were located in vacation destinations, not urban or roadside markets. Unlike other lodging markets, where there is one common source to secure rental of all rooms, a condominium complex may have a variety of rental sources. This typically is the on site property manager or the realty company which handled or continues to handle the sale and resale of the units. However, it can be other realty agents, or the individual owner or a nearby lodging property that owns or manages rental of units. With a multiple of owners, there are a multiple of rental sources.Slide #10: Next, we look at some of the characteristics of condominiums that were part of the study bearing in mind there are some variations and exceptions to each characteristic. The bylaws must permit rental for less than 30 days. Many room taxes and state laws distinguish transient guest rental from residential use or apartment use on the nature of the rental period. Homeowners who want a residential environment require a 30 or more day requirement to discourage transient guest rental, especially in vacation areas. Many times the rental for these units were more less than an extended stay, but more than the nightly stay typical of a hotel or motel experience. As a vacation destination, weekend or weekly use is very common and that is often a minimum stay requirement in condos. The units were located in vacation destinations, not urban or roadside markets. Unlike other lodging markets, where there is one common source to secure rental of all rooms, a condominium complex may have a variety of rental sources. This typically is the on site property manager or the realty company which handled or continues to handle the sale and resale of the units. However, it can be other realty agents, or the individual owner or a nearby lodging property that owns or manages rental of units. With a multiple of owners, there are a multiple of rental sources.

11. Quantifying the Rental Condominium Segment of the Hospitality Industry Condominium Services Often functions without: bell service, but carts are available; daily housekeeping services; guest services such as a concierge; on site food service; a formal check in desk and may be at another building such as realty office. However, notable exceptions that are important include..... Slide #11: In contrast with typical lodging properties, these units typically function with a variation of what is found in traditional lodging properties (read from slide)..... Slide #11: In contrast with typical lodging properties, these units typically function with a variation of what is found in traditional lodging properties (read from slide).....

12. Quantifying the Rental Condominium Segment of the Hospitality Industry Condominium Services ....large developments with sufficient units to justify these services such as Gulf Shores Plantation in Alabama. ....condominiums offered in same develop-ment with traditional overnight lodging such as Sunriver Resort in Oregon. �condominium motels which function and by all appearances are typical lodging properties, but are actually condominiums such as the Canterbury Inn in Ocean Shores, Washington. Slide #12: There are several circumstances in which condominiums are very, very similar to typical lodging properties and even viewed by the public as not being a condominium property.Slide #12: There are several circumstances in which condominiums are very, very similar to typical lodging properties and even viewed by the public as not being a condominium property.

13. Quantifying the Rental Condominium Segment of the Hospitality Industry Transient Guest Rental Owners make decision to place unit into transient guest rental. Decision often based on desire for income, purpose in purchasing (investment or personal use), and desire for privacy inherent in personal use. Rental may be for full year or partial year, choosing to rent during time of highest rates and personal use during other times. Slide #13: This study is less about condominiums and more about transient guest rental of condominiums. The principal investigators noted in their various studies some attributes of transient guest rental�.some obvious and some not so obvious. (read from slide if desired)Slide #13: This study is less about condominiums and more about transient guest rental of condominiums. The principal investigators noted in their various studies some attributes of transient guest rental�.some obvious and some not so obvious. (read from slide if desired)

14. Quantifying the Rental Condominium Segment of the Hospitality Industry Transient Guest Rental Owners place their unit for rent for using one of a variety of methods including: --on site manager; --off site manager; --off site realty firm which may be developer and/or involved in resale of units and may or may not be the property manager; --vacation rental companies; --on their own through Web sites, visitor guide listings, newspaper ads, word of mouth. Slide #14: The focus of a study such as this must be not on buildings, but rather on businesses involved in transient guest rental. These are some of the entities documented in the study, that is all except the last. A small number of individuals seek rental agreements on their own. The database does not attempt to document or compile a listing of these individuals.Slide #14: The focus of a study such as this must be not on buildings, but rather on businesses involved in transient guest rental. These are some of the entities documented in the study, that is all except the last. A small number of individuals seek rental agreements on their own. The database does not attempt to document or compile a listing of these individuals.

15. Quantifying the Rental Condominium Segment of the Hospitality Industry Sources of Data Marketing and Promotion Internet Web sites CVB/Chamber Visitor Guides Yellow Page Listings State Lodging Guides State Visitor Centers AAA Tour Guides USA Reference (electronic database of yellow page listings available in libraries) Slide #15: To prepare a database of entities engaged in transient guest rental the sources fell into two categories. The first category assumes that these entities are actively seeking to rent their units and can be identified through their marketing and promotion efforts. Of these, use of the Internet and CVB/Chamber Visitor Guides were cited as most valuable.Slide #15: To prepare a database of entities engaged in transient guest rental the sources fell into two categories. The first category assumes that these entities are actively seeking to rent their units and can be identified through their marketing and promotion efforts. Of these, use of the Internet and CVB/Chamber Visitor Guides were cited as most valuable.

16. Quantifying the Rental Condominium Segment of the Hospitality Industry Sources of Data Government Sources County Assessors Office County Business License Section State Department of Health/Licensing Office State Equalization Boards City Business License City Planning and Zoning Offices Other Vacation Rental Managers Association Slide #16: The other sources are government sources linked to the fact government often taxes and classifies properties as condominiums, collects room taxes from them and requires them to be licensed as providing accommodations for transient guests. Both the California and the Oregon study noted county officials are most helpful, followed by city and then state offices.Slide #16: The other sources are government sources linked to the fact government often taxes and classifies properties as condominiums, collects room taxes from them and requires them to be licensed as providing accommodations for transient guests. Both the California and the Oregon study noted county officials are most helpful, followed by city and then state offices.

17. Quantifying the Rental Condominium Segment of the Hospitality Industry Database DevelopmentCalifornia Sources for database development included government agencies with city and county being most valuable. Mail surveys to verify data received less than 10% response causing phone call and on site observations to validate responses. Data collected was only property names and addresses, using statistical methodology based on number of units in a sample to determine the total number of units. Slide #17: Using these sources the researchers share with you the methodology used in four of these studies. Methodology is of interest and value to other researchers and sharing how this team assembled its results is one of the purposes of the study. California was the pilot study. With the promise of government lists, a mail survey was conducted and a lesson learned early�this can only be done by phone or in-person contact.Slide #17: Using these sources the researchers share with you the methodology used in four of these studies. Methodology is of interest and value to other researchers and sharing how this team assembled its results is one of the purposes of the study. California was the pilot study. With the promise of government lists, a mail survey was conducted and a lesson learned early�this can only be done by phone or in-person contact.

18. Quantifying the Rental Condominium Segment of the Hospitality Industry Database DevelopmentAlabama Source for database was Gulf Coast Conven-tion and Visitors Bureau. Phone calls and personal visits to realty and property management firms verified number of units being used for transient guest rental and to secure other missing information. Total inventory of condo units and hotel rooms was obtained from the CVB and the number of AH&LA members was provided by the Alabama Hospitality Association. Slide #18: Alabama succeeded because of the close working relationship with the bureau that has done an extraordinary good job of tracking condo development. Many of the statistics used in the report were based on their good work. Many other states that have a concentration of these developments in a particular area would be well served to partner with the local bureau.Slide #18: Alabama succeeded because of the close working relationship with the bureau that has done an extraordinary good job of tracking condo development. Many of the statistics used in the report were based on their good work. Many other states that have a concentration of these developments in a particular area would be well served to partner with the local bureau.

19. Quantifying the Rental Condominium Segment of the Hospitality Industry Database DevelopmentColorado Research was conducted on a county by county basis. There are 33 counties in Colorado. Contact was to community tourism bureaus in each county to ask about short term condo-minium unit rentals, collecting information from their local visitor guides and Internet sites. Other sources utilized to identify units included the Colorado AAA Tour Book and Yellow Page listings. Slide #19: The Colorado study was a statewide study that began with an examination of the presence of these units in each county. As in other studies, the best source of information was the community tourism bureau resources. Other sources included AAA Tour Book and Yellow Page listings. From this information the communities with a presence of units sufficient to report in this study were identified and the database developed. Slide #19: The Colorado study was a statewide study that began with an examination of the presence of these units in each county. As in other studies, the best source of information was the community tourism bureau resources. Other sources included AAA Tour Book and Yellow Page listings. From this information the communities with a presence of units sufficient to report in this study were identified and the database developed.

20. Quantifying the Rental Condominium Segment of the Hospitality Industry Database DevelopmentHawaii State government studies provided baseline data, however, use of Internet and visitors guides were most valuable. Phone calls sought information on number of rental units but securing this was difficult due to tax collection issues, conformance to legal usage and competitive concerns. As in all seven studies, an Excel database was delivered to AH&LA and the member state association. Slide #20: Hawaii relied on a combination of government source and personal contact. Glenn Nakamura reported something that may be encountered in doing this type of study, that is a resistance to disclose information because units may be operating below the radarscope of the government officials with regard to tax and legal usage issues. They therefore are suspicious of questions and do not want to disclose their information.Slide #20: Hawaii relied on a combination of government source and personal contact. Glenn Nakamura reported something that may be encountered in doing this type of study, that is a resistance to disclose information because units may be operating below the radarscope of the government officials with regard to tax and legal usage issues. They therefore are suspicious of questions and do not want to disclose their information.

21. Quantifying the Rental Condominium Segment of the Hospitality Industry Database DevelopmentOregon Source for database was county assessors office in five counties and a database from the Central Oregon Visitors Association. Other key sources were Internet sites for Wild Rivers Coast and each county/city chamber or visitors bureau. Phone calls collected majority of information. Personal visits to visitors centers along coast was very valuable as was personal stop to meet managers and request data. Slide #21: Oregon relied most strongly on Internet searches. In fact a 61-page Word document was created with all the data copied from numerous Web sites. Using further searches and phone calls, many entities were eliminated because they did not fit the study criteria. They were only engaged in rental of vacation homes, they were timeshare developments and there were private individuals. Of course there were duplications as companies and individuals were listed on multiple sites. The closing comment is a personal visit to the locations to secure the data is an essential ingredient for success.Slide #21: Oregon relied most strongly on Internet searches. In fact a 61-page Word document was created with all the data copied from numerous Web sites. Using further searches and phone calls, many entities were eliminated because they did not fit the study criteria. They were only engaged in rental of vacation homes, they were timeshare developments and there were private individuals. Of course there were duplications as companies and individuals were listed on multiple sites. The closing comment is a personal visit to the locations to secure the data is an essential ingredient for success.

22. Quantifying the Rental Condominium Segment of the Hospitality Industry Inventory of Condo UnitsDatabase Fields All studies collected the following data: Name of Company/Property Street City, State Zip Contact Person Contact Person Title Phone Number Fax Number E-mail Address Management Company/Corporation # of Units Available for Transient Rental Slide #22: From this work a key component of the scope of work was obtained, a database of these entities. While it was not possible to complete very bit of information for every entity, the databases all include the following key data. Slide #22: From this work a key component of the scope of work was obtained, a database of these entities. While it was not possible to complete very bit of information for every entity, the databases all include the following key data.

23. Quantifying the Rental Condominium Segment of the Hospitality Industry Inventory of Condo UnitsDatabase Fields Additional data collected during several of the studies: Website Address Total Number of Units Toll-free Number Data not collected: Number of Bedrooms was too complicated for response and deemed not valuable. AH&LA Member Status was more easily available through state associations. Slide #23: In the course of the work, some of the work included additional fields that could be added because the source of the work was Internet based. They are shown in the top half of this slide. Some of the data that was part of the original scope of work was not collected and the reason is shown here in the bottom half of this slide.Slide #23: In the course of the work, some of the work included additional fields that could be added because the source of the work was Internet based. They are shown in the top half of this slide. Some of the data that was part of the original scope of work was not collected and the reason is shown here in the bottom half of this slide.

24. Quantifying the Rental Condominium Segment of the Hospitality Industry Inventory of Condo UnitsUse of Database The database for each state has been provided to the state association and the AH&LA. The information will be used to: Determine condominium properties that are already members. Determine the potential for condominium member-ship within their state or local associations. Create awareness among staff, leadership and members of this important component of the lodging industry. Slide #24: As noted, the database for each state has been given to the member state association and AH&LA. While this information is not part of the published report it can be used for any of the reasons shown on this slide or the next one. (read from slide if desired)Slide #24: As noted, the database for each state has been given to the member state association and AH&LA. While this information is not part of the published report it can be used for any of the reasons shown on this slide or the next one. (read from slide if desired)

25. Quantifying the Rental Condominium Segment of the Hospitality Industry Inventory of Condo UnitsUse of Database Provide updated information for visitors and lodging guides. Be a source for additional information not collected as part of this survey but suggested for this study including rental rates, number of bedrooms, pet policy, distinctive features, activities and special amenities. Database information is not part of available documents, although certain information may be released through the state association or the AH&LA. Slide #25: This is a continuation of the listing of how this data can and will be used by the member state association and AH&LA.Slide #25: This is a continuation of the listing of how this data can and will be used by the member state association and AH&LA.

26. Quantifying the Rental Condominium Segment of the Hospitality Industry Condominium DevelopmentSeven States�Three Large States Number of Number of Developments Units California 502 40,260 (California includes all units, not just transient guest rental units) Colorado 205 17,859 Hawaii 243 18,532 (These two states were part of Phase II that sought to document only transient guest rental units.) Slide #26: Now we move into the actual data results based on the information in these databases. California was different and as a pilot study many valuable lessons were learned. One of them is the focus in subsequent studies needed to focus on transient guest units and not total units. That was done in Phase II. Also, California total numbers were a statistical calculation, not an actual documentation. To estimate the population of total rooms inventory, Ed Merritt compared a sample of rental condominium entities where he was able to secure the total number of units to a sample of rental condominium entities that are current members of the California Hotel & Lodging Association. The CH&LA sample average per entity rooms inventory was 80.42 rooms. His sample average per entity rooms inventory was 80.20 rooms. Using the average per entity rooms inventories, he projected a total rooms population inventory between 40,260 and 40,369. In Phase II the AH&LA sought documented data. The Colorado and Hawaii results are of the entire state although the Colorado study in the end found these developments only in recreational areas and the subject area focused on these areas. Slide #26: Now we move into the actual data results based on the information in these databases. California was different and as a pilot study many valuable lessons were learned. One of them is the focus in subsequent studies needed to focus on transient guest units and not total units. That was done in Phase II. Also, California total numbers were a statistical calculation, not an actual documentation. To estimate the population of total rooms inventory, Ed Merritt compared a sample of rental condominium entities where he was able to secure the total number of units to a sample of rental condominium entities that are current members of the California Hotel & Lodging Association. The CH&LA sample average per entity rooms inventory was 80.42 rooms. His sample average per entity rooms inventory was 80.20 rooms. Using the average per entity rooms inventories, he projected a total rooms population inventory between 40,260 and 40,369. In Phase II the AH&LA sought documented data. The Colorado and Hawaii results are of the entire state although the Colorado study in the end found these developments only in recreational areas and the subject area focused on these areas.

27. Quantifying the Rental Condominium Segment of the Hospitality Industry Condominium DevelopmentSeven States�Four Small StatesTargeted to specific areas in state Number of Number of Developments Units Gulf Coast Alabama 44 7,015 Gulf Coast Mississippi 31 1,030 Pacific Coast, Mt. Hood, and Central Oregon 81 2,342 South Pacific Coast, Puget Sound, and ski areas of Washington 47 1,550 Slide #27: The three previous states represent large states. To assure the study accounted for the diversity of the state associations and to maximize the number of states given the resources available, four smaller states were selected for two of the studies. Each of these studies concentrated on areas in the state identified by the state association as the areas with a concentration of condominium units.Slide #27: The three previous states represent large states. To assure the study accounted for the diversity of the state associations and to maximize the number of states given the resources available, four smaller states were selected for two of the studies. Each of these studies concentrated on areas in the state identified by the state association as the areas with a concentration of condominium units.

28. Quantifying the Rental Condominium Segment of the Hospitality Industry Condominium DevelopmentTotal Units vs. Transient Guest Rental Total Guest Rental Units Units Percentage Alabama 11,028 7,015 64% Mississippi 1,314 1,030 78% Oregon 4,338 2,342 54% Washington 1,550 932 60% Guest rental units and percentages are understated due to exclusion of individuals renting their own units and rental agencies outside the geographical area. Slide #28: Because it was easy to collect this data on a limited scale, these studies also sought to determine the total number of units in the various developments. This gives us an idea in different areas of the country, how many units are being used for transient guest rental. The statistics should be used with some precaution. Because the rental by individual owner and agencies outside the geographical area is not included, they are understated. The interviews conducted by Doug Viehland in these areas indicated that an additional 10% could easily be added.Slide #28: Because it was easy to collect this data on a limited scale, these studies also sought to determine the total number of units in the various developments. This gives us an idea in different areas of the country, how many units are being used for transient guest rental. The statistics should be used with some precaution. Because the rental by individual owner and agencies outside the geographical area is not included, they are understated. The interviews conducted by Doug Viehland in these areas indicated that an additional 10% could easily be added.

29. Quantifying the Rental Condominium Segment of the Hospitality Industry Condominium DevelopmentTotal Units vs. Transient Guest RentalSeveral Determining Factors Purchase decision was for vacation home/personal use or investment/income. On site management/services increases likelihood of rental program use. Location near urban area created better access as vacation home and personal use. Restrictions on rental length deters guest rental such as minimum of one week. Higher purchase and maintenance costs may cause increased use as rental. Rental percentages increase during high season to secure premium rates with the unit converted to personal use during other times. Slide #29: The percentages of total units vs. transient guest rental range from 100% to less than 10%. In reviewing the make-up of these entities and on-site interviews some of the reasons for the variance in these percentages are noted in this slide. (read from slide if desired). Slide #29: The percentages of total units vs. transient guest rental range from 100% to less than 10%. In reviewing the make-up of these entities and on-site interviews some of the reasons for the variance in these percentages are noted in this slide. (read from slide if desired).

30. Quantifying the Rental Condominium Segment of the Hospitality Industry Number of Condo Units Available for Transient Guest Rental compared to Number of Hotel Rooms Alabama Subject Area is Gulf Coast Condo Hotel Ratio Units Rooms Condo:Hotel 7,016 2,617 1:0.37 Colorado Subject Area is 26 communities in 13 counties with significant condo development Condo Hotel Ratio Units Rooms Condo:Hotel 17, 859 19,500 1:1.09 Slide #30: The next set of slides identifies the number of hotel rooms in contrast to the number of hotel rooms. In one area, Alabama Gulf Coast, the number of condos actually outnumbers hotel rooms by a three to one margin. Colorado, again just in the 26 communities located in 13 counties in recreational mountain areas; the ratio is nearly 1:1. In his study Bob Benton noted two reasons for this ratio and is probably applicable in other areas. 1) Seasonal demand patterns have adversely impacted the financial feasibility of traditional hotel development. While demand tends to be healthy during the winter and summer seasons, lodging demand in the state�s ski resort markets is relatively soft during the spring and fall. As a result, it is difficult to finance traditional hotels in these markets. Condominium ownership alleviates the difficulty of financing new development, by providing a new source of capital for development. In addition, the demand for second home ownership and/or investment real estate within the Colorado ski resorts has been relatively strong over the last several years, a trend that is expected to continue into the foreseeable future. 2) Condominium units are popular with visitors to the Colorado ski resorts, due to a length of stay that average from four to seven nights. Due to the longer length of stay, travelers appreciate the additional room that condominiums provide, as well as kitchen facilities. Bob concludes�.�based on these trends, the majority of future lodging development in Colorado�s ski markets is expected to consist of condominium projects.� Alabama statistics reproduced in that report projects in the next three years, nearly 2,000 condo units will be added in contrast to just 84 hotel rooms. Slide #30: The next set of slides identifies the number of hotel rooms in contrast to the number of hotel rooms. In one area, Alabama Gulf Coast, the number of condos actually outnumbers hotel rooms by a three to one margin. Colorado, again just in the 26 communities located in 13 counties in recreational mountain areas; the ratio is nearly 1:1. In his study Bob Benton noted two reasons for this ratio and is probably applicable in other areas. 1) Seasonal demand patterns have adversely impacted the financial feasibility of traditional hotel development. While demand tends to be healthy during the winter and summer seasons, lodging demand in the state�s ski resort markets is relatively soft during the spring and fall. As a result, it is difficult to finance traditional hotels in these markets. Condominium ownership alleviates the difficulty of financing new development, by providing a new source of capital for development. In addition, the demand for second home ownership and/or investment real estate within the Colorado ski resorts has been relatively strong over the last several years, a trend that is expected to continue into the foreseeable future. 2) Condominium units are popular with visitors to the Colorado ski resorts, due to a length of stay that average from four to seven nights. Due to the longer length of stay, travelers appreciate the additional room that condominiums provide, as well as kitchen facilities. Bob concludes�.�based on these trends, the majority of future lodging development in Colorado�s ski markets is expected to consist of condominium projects.� Alabama statistics reproduced in that report projects in the next three years, nearly 2,000 condo units will be added in contrast to just 84 hotel rooms.

31. Quantifying the Rental Condominium Segment of the Hospitality Industry Number of Condo Units Available for Transient Guest Rental compared to Number of Hotel Rooms Hawaii Subject Area is Six Islands as documented in 2001 Visitor Plant Inventory Condo Hotel Ratio Units Rooms Condo:Hotel 16,545 55,659 1:3.36 Mississippi Subject Area is Gulf Coast Condo Hotel Ratio Units Rooms Condo:Hotel 1,030 15,448 1:15 Slide #31: Hawaii has a larger study area and utilized government statistics to develop the numbers you see here. Mississippi with the gulf coast area including the metropolitan area of Biloxi has a significant number of hotels, especially large gaming facilities. As a result the ratio increases to 1:15. Of special note, Doug Viehland notes in his written report this ratio will change very soon: � While the current largest condo development is 108 units, two developments are in a pre-sale mode. The Legacy Condominium development plans for the construction of two towers with 206 units and the Sea Breeze Condominium development plans for the construction of 162 units. In one case, the construction of will result in the destruction and removal of an oceanfront motel property.� Slide #31: Hawaii has a larger study area and utilized government statistics to develop the numbers you see here. Mississippi with the gulf coast area including the metropolitan area of Biloxi has a significant number of hotels, especially large gaming facilities. As a result the ratio increases to 1:15. Of special note, Doug Viehland notes in his written report this ratio will change very soon: � While the current largest condo development is 108 units, two developments are in a pre-sale mode. The Legacy Condominium development plans for the construction of two towers with 206 units and the Sea Breeze Condominium development plans for the construction of 162 units. In one case, the construction of will result in the destruction and removal of an oceanfront motel property.�

32. Quantifying the Rental Condominium Segment of the Hospitality Industry Number of Condo Units Available for Transient Guest Rental compared to Number of Hotel Rooms Oregon Counties Condo Hotel Ratio County Units Rooms Condo:Hotel Curry 39 1,176 1:30 Deschutes 821 3,051 1:3.7 Lincoln 659 4,019 1:6 Slide #32: It was easier in Oregon and Washington to present information in a different format. Doug took selected cities and selected counties. The rural area of the Oregon Pacific Coast is Curry county. It is the most southwestern county bordering California while Lincoln County is located on the central coast nearest to Portland. The ratios are dramatically different and surely represent the entire range in Oregon. Deschutes County is located in Central Oregon.Slide #32: It was easier in Oregon and Washington to present information in a different format. Doug took selected cities and selected counties. The rural area of the Oregon Pacific Coast is Curry county. It is the most southwestern county bordering California while Lincoln County is located on the central coast nearest to Portland. The ratios are dramatically different and surely represent the entire range in Oregon. Deschutes County is located in Central Oregon.

33. Quantifying the Rental Condominium Segment of the Hospitality Industry Number of Condo Units Available for Transient Guest Rental compared to Number of Hotel Rooms Oregon Cities Condo Hotel Ratio City Units Rooms Condo:Hotel Brookings 12 381 1:32 Lincoln City 379 1,559 1:4.1 Slide #33: Looking at individual cities within two of the counties, t he rural area of the Oregon Pacific Coast is Curry county and the only major city in that county is Brookings. Lincoln City is located in Lincoln County on the central coast nearest to Portland. Again, the ratios are dramatically different and surely represent the entire range in Oregon. Slide #33: Looking at individual cities within two of the counties, t he rural area of the Oregon Pacific Coast is Curry county and the only major city in that county is Brookings. Lincoln City is located in Lincoln County on the central coast nearest to Portland. Again, the ratios are dramatically different and surely represent the entire range in Oregon.

34. Quantifying the Rental Condominium Segment of the Hospitality Industry Number of Condo Units Available for Transient Guest Rental compared to Number of Hotel Rooms Washington Cities Condo Hotel Ratio City Units Rooms Condo:Hotel Blaine 95 244 1:2.57 Chelan 180 556 1:3.09 Ocean Shores 319 1,095 1:2.93 Slide #32: In the State of Washington circumstances dictated a review by cities. Just to show you how some of this data can be used, this information is presented not only by city, but by total number of units and only transient guest units. Blaine is located at the most northern tip of Puget Sound nearly the Canadian border. Chelan is a summer recreation area east of Seattle and the location of Lake Chelan. Ocean Shores is most like the developments the study found in Alabama and Colorado with a huge presence of condo development and is located on the ocean west of Seattle.Slide #32: In the State of Washington circumstances dictated a review by cities. Just to show you how some of this data can be used, this information is presented not only by city, but by total number of units and only transient guest units. Blaine is located at the most northern tip of Puget Sound nearly the Canadian border. Chelan is a summer recreation area east of Seattle and the location of Lake Chelan. Ocean Shores is most like the developments the study found in Alabama and Colorado with a huge presence of condo development and is located on the ocean west of Seattle.

35. Quantifying the Rental Condominium Segment of the Hospitality Industry Number of Condo Units Available for Transient Guest Rental compared to Number of Hotel Rooms Condominiums as a Percentage of Hotel and Transient Guest Rental Condominium Inventory in Subject Areas Alabama Gulf Coast 72.8% Colorado communities 47.8% Hawaii 22.9% Mississippi Gulf Coast 6.2% Oregon counties 18.4% Washington cities 34.2% Slide #35: This is a summary slide of the numbers and ratios you have just seen. Nearly 73% of all inventory in the gulf coast of Alabama is condos, in the 26 communities of Colorado it is nearly 48% and so on.Slide #35: This is a summary slide of the numbers and ratios you have just seen. Nearly 73% of all inventory in the gulf coast of Alabama is condos, in the 26 communities of Colorado it is nearly 48% and so on.

36. Quantifying the Rental Condominium Segment of the Hospitality Industry Number of AH&LA Members In Subject AreasSeveral Determining Factors Presence of off site management primarily through realtors in Alabama and Mississippi. Realty and property management firms do not perceive themselves as lodging properties, but as rental properties. Colorado offers an array of benefits and recruits membership from condominium properties. The larger properties in Oregon are members of OLA and conduct business as lodging properties, not rental properties. Nine of the 10 largest condo properties are members representing 1,184 rental units and 1,828 total units. None of the 40 smallest properties are members. Slide #36: The heading has changed as we move to final area of statistical data. Before we all glaze over with the volume of information presented, let me set the stage for this final data presentation. Here we present the determining factors that will lead into the statistical data. You will see in the information only one property in Alabama and one property in Mississippi is a member. The huge volume of rental here is conducted by off site property managers with most of them being the realty firms that handle the sale and re-sale of these units and vacation rental is a source of leads, primarily. They do not perceive them as in the same business as hotels and motels. You will see Colorado has done an extraordinary job of securing over 50% of all condos in membership and has done this by acknowledging their presence with an array of benefits. The other state that has greater than 50% is Oregon for a different reason. An array of the developments indicates the largest condo properties act like hotels. The top ten properties offer on site management and all the services of a hotel and are destinations for conventions, meetings and tour groups. Slide #36: The heading has changed as we move to final area of statistical data. Before we all glaze over with the volume of information presented, let me set the stage for this final data presentation. Here we present the determining factors that will lead into the statistical data. You will see in the information only one property in Alabama and one property in Mississippi is a member. The huge volume of rental here is conducted by off site property managers with most of them being the realty firms that handle the sale and re-sale of these units and vacation rental is a source of leads, primarily. They do not perceive them as in the same business as hotels and motels. You will see Colorado has done an extraordinary job of securing over 50% of all condos in membership and has done this by acknowledging their presence with an array of benefits. The other state that has greater than 50% is Oregon for a different reason. An array of the developments indicates the largest condo properties act like hotels. The top ten properties offer on site management and all the services of a hotel and are destinations for conventions, meetings and tour groups.

37. Quantifying the Rental Condominium Segment of the Hospitality Industry Number of AH&LA MembersIn Subject AreasSeveral Determining Factors Washington, like Oregon, has an abundance of large properties that operate as lodging properties, especially condominium motels. Hawaii has 43% of the total condominium units in the state as member. This percentage does vary dramatically from island to island. The percentage of AH&LA membership among condominium units is approximate to AH&LA membership penetration of hotel/motel rooms in Colorado. Slide #37: Washington is similar to Oregon except the number of properties is smaller and the size of these properties are smaller. In Hawaii the number is 43%. In fact, using just the geographical areas that were a part of this study, Bob Benton notes �CH&LA�s penetration into the condominium market is actually greater than its penetration into the traditional lodging market.� The same is possibly true for Oregon.Slide #37: Washington is similar to Oregon except the number of properties is smaller and the size of these properties are smaller. In Hawaii the number is 43%. In fact, using just the geographical areas that were a part of this study, Bob Benton notes �CH&LA�s penetration into the condominium market is actually greater than its penetration into the traditional lodging market.� The same is possibly true for Oregon.

38. Quantifying the Rental Condominium Segment of the Hospitality Industry Number of AH&LA MembersIn Subject Areas Condo AH&LA Member Units Properties Units Alabama 7,015 1 320 Colorado 17,859 100 10,354 Hawaii 18,532 53 8,036 Mississippi 1,030 1 70 Oregon 2,342 24 1,379 (total units) 4,338 24 2,134 Washington 932 6 228 (total units) 1,550 6 498 Condo Units are Transient Guest unless except as indicated Slide #38: Now back to statistical data. This is the number of transient guest condo units from previous slides, the number of entities that are AH&LA members and number of units from the first column that are in these properties. In Oregon and Washington we took both the rental numbers and the total number of units you saw from previous slides and comparable numbers from the AH&LA properties. Slide #38: Now back to statistical data. This is the number of transient guest condo units from previous slides, the number of entities that are AH&LA members and number of units from the first column that are in these properties. In Oregon and Washington we took both the rental numbers and the total number of units you saw from previous slides and comparable numbers from the AH&LA properties.

39. Quantifying the Rental Condominium Segment of the Hospitality Industry Number of AH&LA MembersIn Subject AreasPercentages of Condo Units that are members based on previous slide Alabama 4.5% Colorado 58% Hawaii 43% Mississippi 6.8% Oregon 59% (total units) 49% Washington 24% (total units) 32% Slide #39: This is a better representation since it provides the percentage that is more easily understood. Alabama has 4.5% of all condo units in the gulf coast area as members; Colorado has a 58% in the 26 communities and so forth.Slide #39: This is a better representation since it provides the percentage that is more easily understood. Alabama has 4.5% of all condo units in the gulf coast area as members; Colorado has a 58% in the 26 communities and so forth.

40. Quantifying the Rental Condominium Segment of the Hospitality Industry Condominium Activity in Other States Florida: State law requires the licensing of condo as rentals for transient guests. The state reports nearly 9,000 separate developments representing nearly 89,000 units. South Carolina: South Carolina has a member category for realty firms. Some of these firms engage in vacation rental management. Other States: Wyoming and Maryland reported the presence of condos, but do not have a separate category or definite numbers among membership. Slide #40: During the preparation of the final results, a request was made of state associations that may have some idea of the presence of condominium development in their state to report their activity. Florida and South Carolina was specifically requested since they had previously been target states for this study and the ad hoc committee was aware of some activity. Additional comments were received from other states, with both Wyoming and Maryland reporting some activity.Slide #40: During the preparation of the final results, a request was made of state associations that may have some idea of the presence of condominium development in their state to report their activity. Florida and South Carolina was specifically requested since they had previously been target states for this study and the ad hoc committee was aware of some activity. Additional comments were received from other states, with both Wyoming and Maryland reporting some activity.

41. Quantifying the Rental Condominium Segment of the Hospitality Industry Strategies for Condominium MembershipColorado Colorado treats condominiums in the same manner as traditional lodging. Condominium operators serve in the same capacity as traditional operators. However, there is a strong presence among the leadership. The current Executive Committee has three condo operators serving and one-third of the Board are condo operators. CH&LA has a Condominium Segment Committee that meets twice a year and annually hosts a one-day workshop for condo operators. A section of each seminar presented by CH&LA focuses on the condominium segment. Slide #41: Bob Benton in his study documented some of the activities of Colorado to secure membership by condominiums. We want to share this with you as a prelude to the final stage of the study, which discusses strategies for membership by condominiums within AH&LA�.(read from slide if desired).Slide #41: Bob Benton in his study documented some of the activities of Colorado to secure membership by condominiums. We want to share this with you as a prelude to the final stage of the study, which discusses strategies for membership by condominiums within AH&LA�.(read from slide if desired).

42. Quantifying the Rental Condominium Segment of the Hospitality Industry Strategies for Condominium MembershipDifferent Models Condominium owners are represented by their own association, the homeowners association. Issues of training, sales and marketing, legislative advocacy are remote from their interest as owners to be effective in terms of potential membership. Condominium Homeowners Associations have their own association, the Community Associations Institute. Again, the issues of training, sales and marketing, legislative advocacy are too remote from their interest as an association of owners to be effective in terms of potential membership. Slide #42: If one looks at the models of traditional lodging properties, there are owners, management companies and brands. Because the researchers excluded timeshare, there are no brands in the condo market under study. There are owners and managers and a third entity that does not exist in the traditional lodging market, the homeowners association. Where is the target for membership for AH&LA is the subject of the next two slides. The individual owner is not a candidate for a variety of reasons�(read from slide if desired). The homeowners association could be considered a candidate, but not really. Slide #42: If one looks at the models of traditional lodging properties, there are owners, management companies and brands. Because the researchers excluded timeshare, there are no brands in the condo market under study. There are owners and managers and a third entity that does not exist in the traditional lodging market, the homeowners association. Where is the target for membership for AH&LA is the subject of the next two slides. The individual owner is not a candidate for a variety of reasons�(read from slide if desired). The homeowners association could be considered a candidate, but not really.

43. Quantifying the Rental Condominium Segment of the Hospitality Industry Strategies for Condominium MembershipDifferent Models Vacation Rental Manager is the best candidate for membership. This may be on-site or off-site property and rental managers. The manager is typically not represented by an existing association. Most important, the issues of training, sales and marketing, legislative advocacy are important to their interest as owners to be effective in terms of potential membership. Slide #43: The obvious choice is the vacation rental manager. As noted previously in slide 14 this includes not just traditional hotel managers, but can include realtors and vacation rental manager companies.Slide #43: The obvious choice is the vacation rental manager. As noted previously in slide 14 this includes not just traditional hotel managers, but can include realtors and vacation rental manager companies.

44. Quantifying the Rental Condominium Segment of the Hospitality Industry Strategies for Condominium MembershipCreating the Condominium Segment Strategies to bring condominiums into membership suggest recognizing differences in needs of condo operators and traditional lodging operators. Creating a condominium committee to be a voice for this segment while treating condominiums in the same manner as traditional lodging. Creating a separate category of membership for vacation rental managers limited to managers who rent/ manage condos from an off-site location without certain services such as check-in, bell service, on site food service. Creating a separate category of membership for operators of condominium properties. Slide #44: The differences in owner/management models, availability of units for continual occupancy and the different operating practices of weekly stays versus nightly stays suggest condominium membership in the state and national lodging associations will not easily fit into the current model for hotels and motels. Other trade and individual member associations have created sections or special interest groups to bring into membership a new category of membership or to build membership in an existing category. Doug Viehland and Glenn Nakamura go into detail in their reports and Bob Benton references the need for CH&LA to continue to recognize the importance of the Colorado condominium community and its programs.Slide #44: The differences in owner/management models, availability of units for continual occupancy and the different operating practices of weekly stays versus nightly stays suggest condominium membership in the state and national lodging associations will not easily fit into the current model for hotels and motels. Other trade and individual member associations have created sections or special interest groups to bring into membership a new category of membership or to build membership in an existing category. Doug Viehland and Glenn Nakamura go into detail in their reports and Bob Benton references the need for CH&LA to continue to recognize the importance of the Colorado condominium community and its programs.

45. Quantifying the Rental Condominium Segment of the Hospitality Industry Strategies for Condominium MembershipRationale for Membership Some of the benefits that could be offered to this segment include: Management training to improve the management of vacation rental properties. Line level and supervisory employee training for housekeeping staff, security staff, spa and pool staff and a host of other staff. Condominium management companies benefit from networking with hotels in anticipation the hotels may find themselves in an oversold or a referral situation. (continued to next slide) Slide #44: Some of the benefits that could be offered as outlined in the report of Doug Viehland based on his interviews are: Management training to improve the management of vacation rental properties. The Educational Institute already has a prepared textbook in this subject area and future opportunities include an educational track at national or state conventions and certification. Line level and supervisory employee training for housekeeping staff, security staff, spa and pool staff and a host of other staff. While there is little need to modify the current training materials of the Educational Institute to offer these products to the condominium segment, this modification should be strongly considered. As explained later, the creation of a separate segment so the management of vacation rental properties can have a separate identify is essential for success. Condominium management companies benefit from networking with hotels in anticipation the hotels may find themselves in an oversold or a referral situation and need to accommodate a confirmed or prospective guest, especially in areas with a high concentration of condos as compared to hotels.Slide #44: Some of the benefits that could be offered as outlined in the report of Doug Viehland based on his interviews are: Management training to improve the management of vacation rental properties. The Educational Institute already has a prepared textbook in this subject area and future opportunities include an educational track at national or state conventions and certification. Line level and supervisory employee training for housekeeping staff, security staff, spa and pool staff and a host of other staff. While there is little need to modify the current training materials of the Educational Institute to offer these products to the condominium segment, this modification should be strongly considered. As explained later, the creation of a separate segment so the management of vacation rental properties can have a separate identify is essential for success. Condominium management companies benefit from networking with hotels in anticipation the hotels may find themselves in an oversold or a referral situation and need to accommodate a confirmed or prospective guest, especially in areas with a high concentration of condos as compared to hotels.

46. Quantifying the Rental Condominium Segment of the Hospitality Industry Strategies for Condominium MembershipRationale for Membership (continued from previous slide) Advocacy on issues such as bed tax and Labor Day opening for the school year. The group purchasing of a hotel association can aid the management company in securing discounts it would not otherwise achieve or to find a variety of companies to provide any number of services. Listing in state lodging guides as a separate category or as traditional lodging. To gain a competitive advantage by promoting their membership to homeowners associations and the general public. Slide #46: Continuing with some of the benefits Advocacy on issues such as bed tax and Labor Day opening for the school year. The rate and the use of the bed tax is as important to condominium operators as other lodging operators and the Labor Day opening for the school year is an issue for all of tourism with regard to the length of the summer season and the availability of a work force during the final weeks of August. The group purchasing of a hotel association can aid the management company in securing discounts it would not otherwise achieve or to find a variety of companies to provide any number of services. This may be an established purchasing program of the association or merely access to allied members of the association. Realty firms or vacation rental management companies can use the value of membership to gain a competitive advantage. A guest or owner association may make a decision of one company over another based on the fact the management company has shown a commitment to training, advocacy and securing competitive advantage by their membership in an association. Slide #46: Continuing with some of the benefits Advocacy on issues such as bed tax and Labor Day opening for the school year. The rate and the use of the bed tax is as important to condominium operators as other lodging operators and the Labor Day opening for the school year is an issue for all of tourism with regard to the length of the summer season and the availability of a work force during the final weeks of August. The group purchasing of a hotel association can aid the management company in securing discounts it would not otherwise achieve or to find a variety of companies to provide any number of services. This may be an established purchasing program of the association or merely access to allied members of the association. Realty firms or vacation rental management companies can use the value of membership to gain a competitive advantage. A guest or owner association may make a decision of one company over another based on the fact the management company has shown a commitment to training, advocacy and securing competitive advantage by their membership in an association.

47. Quantifying the Rental Condominium Segment of the Hospitality Industry Strategies for Condominium MembershipSteps to Build Membership Some of the specific steps to recognize the needs of the segment are: Educational tracks at state and national meetings. Networking opportunities specific for these members. Promotion of the existing Educational Institute textbook on vacation rental management. Creation of certification or similar designations for the vacation rental manager and staff. Segment leaders integrated into existing committees such as government affairs, membership, technology, etc. (continued to next slide) Slide 47: What are some of the tactics to recruit condominium membership and appeal to them as a section: An educational track created at state and national association conventions and conferences focusing on the unique management challenges of this segment. A luncheon, reception or breakfast where members can gather with other members of the segment to network and receive a report from segment leaders including election of officers. Promotion of the existing Educational Institute textbook on vacation rental management and development/conversion of other educational resources to provide training for line level and supervisory staff. Creation of certification or similar designations for vacation rental managers, sales staff, housekeeping staff and others. Segment leaders integrated into existing committees such as government affairs, convention planning and governing bodies such as the Board and the Executive Committee. Slide 47: What are some of the tactics to recruit condominium membership and appeal to them as a section: An educational track created at state and national association conventions and conferences focusing on the unique management challenges of this segment. A luncheon, reception or breakfast where members can gather with other members of the segment to network and receive a report from segment leaders including election of officers. Promotion of the existing Educational Institute textbook on vacation rental management and development/conversion of other educational resources to provide training for line level and supervisory staff. Creation of certification or similar designations for vacation rental managers, sales staff, housekeeping staff and others. Segment leaders integrated into existing committees such as government affairs, convention planning and governing bodies such as the Board and the Executive Committee.

48. Quantifying the Rental Condominium Segment of the Hospitality Industry Strategies for Condominium MembershipSteps to Build Membership (continued from previous slide) Inclusion as a separate listing in state visitors guides. Officers for the segment including Chairman, Chairman-Elect and other positions. Decals, logos and wording that can be used to promote their membership. Articles in publications focus on this segment. Inclusion of this segment in national research projects such as industry trends or compensation. A review of the dues amount that may be different from the dues amount of traditional operators. Slide 48: We continue with some of the tactics to recruit condominium membership and appeal to them as a section: Assist with their priority need, to market their product. Officers for the segment including Chairman, Chairman-Elect and other positions to best serve the need of the segment, recruit members and to give a greater sense of ownership of their own segment. Decals, logos and wording that can be used to promote membership in this section and the respective state and national association. Special articles in association publications focusing on this segment as well as incorporating the implications of topics being reported on this segment. Inclusion of this segment in national research projects such as industry trends or compensation and benefits or the impact of government regulations. A review of the dues amount that may be different from the dues amount of hotels/motels in the same way the dues amount for supplier members is different. Slide 48: We continue with some of the tactics to recruit condominium membership and appeal to them as a section: Assist with their priority need, to market their product. Officers for the segment including Chairman, Chairman-Elect and other positions to best serve the need of the segment, recruit members and to give a greater sense of ownership of their own segment. Decals, logos and wording that can be used to promote membership in this section and the respective state and national association. Special articles in association publications focusing on this segment as well as incorporating the implications of topics being reported on this segment. Inclusion of this segment in national research projects such as industry trends or compensation and benefits or the impact of government regulations. A review of the dues amount that may be different from the dues amount of hotels/motels in the same way the dues amount for supplier members is different.

49. Quantifying the Rental Condominium Segment of the Hospitality Industry Strategies for Condominium MembershipCompetition Analysis�Local Lodging Associations: This study was unable to document any city or county lodging associations operating exclusively for vacation rental management. Entities operating like lodging properties are often part of the local association. Visitors Bureaus: Vacation rental managers and condo operators use bureaus as their main source of marketing. They also provide benefits of information sharing and networking. Slide 49: The final set of slides look at other organizations that do serve or do not serve this lodging segment. There are no local vacation rental managers associations serving this segment, however those that operate most like traditional lodging properties are hotel members because their market is more than the leisure traveler. Another reason is that the convention and visitors bureaus offer the network and information sharing they most often seek from a local association, plus a key to their success�marketing to those who are coming to the area. Slide 49: The final set of slides look at other organizations that do serve or do not serve this lodging segment. There are no local vacation rental managers associations serving this segment, however those that operate most like traditional lodging properties are hotel members because their market is more than the leisure traveler. Another reason is that the convention and visitors bureaus offer the network and information sharing they most often seek from a local association, plus a key to their success�marketing to those who are coming to the area.

50. Quantifying the Rental Condominium Segment of the Hospitality Industry Strategies for Condominium MembershipCompetition Analysis�Local Chamber of Commerce: In many areas the chamber operates the visitors bureau and offer the same benefits or more that are offered by visitors bureaus. Realty Associations: Vacation rental managers and property management companies are often involved in the sale and resale of condo properties. They will be members for this reason. A search of various Web sites of local realty associations notes an absence of benefits related to the vacation rental management aspect of this business. Slide 50: The Chamber of Commerce often functions as the visitors bureau or operates the visitors centers. This again is a key membership group. Given that many vacation rental managers are engaged in the sale of real estate, this analysis reviewed how they are served by their realty organization. As will become evident, there is no focus by realty association on the activity of vacation rental management, local, state or national.Slide 50: The Chamber of Commerce often functions as the visitors bureau or operates the visitors centers. This again is a key membership group. Given that many vacation rental managers are engaged in the sale of real estate, this analysis reviewed how they are served by their realty organization. As will become evident, there is no focus by realty association on the activity of vacation rental management, local, state or national.

51. Quantifying the Rental Condominium Segment of the Hospitality Industry Strategies for Condominium MembershipCompetition Analysis�State Vacation Rental Managers Associations: This study discovered two states, Florida and North Carolina, that have a statewide association designated for vacation rental managers. In several states such as Oregon there are rental and property managers associations, but are typically focused on residential housing. Realty Associations: Just as noted with the local associations, a search of various Web sites of state realty associations notes an absence of benefits related to the vacation rental management aspect of this business. Slide 51: At the state level, two states, Florida and North Carolina, have a statewide association of vacation rental managers. As stated previously, searches of Web sites for realty organizations did not produce any activity related to vacation rental management.Slide 51: At the state level, two states, Florida and North Carolina, have a statewide association of vacation rental managers. As stated previously, searches of Web sites for realty organizations did not produce any activity related to vacation rental management.

52. Quantifying the Rental Condominium Segment of the Hospitality Industry Strategies for Condominium MembershipCompetition Analysis�National Vacation Rental Managers Association: This national association reports a membership of 500. The presence in the states that are a part of this study is: --Alabama: 10 --California: 72 --Colorado: 11 --Hawaii: 21 --Mississippi: 0 --Oregon: 9 --Washington: 4 The VRMA Web site is www.vrma.org Realty Associations: A search of the National Realtors Association Web site for terms such as �vacation rental� and �condominium rental� resulted in a �no items were found� response on each occasion. Slide 52: At the national level, there is a vacation rental managers association with an excellent Web site and offering several quality benefits. The membership penetration in those states that are a part of this study is shown in this slide. While there is a certification for �property manager� offered by the National Association of Realtors, searches for key words related to this industry resulted in a �no items were found� response.Slide 52: At the national level, there is a vacation rental managers association with an excellent Web site and offering several quality benefits. The membership penetration in those states that are a part of this study is shown in this slide. While there is a certification for �property manager� offered by the National Association of Realtors, searches for key words related to this industry resulted in a �no items were found� response.