CBRE HOTELS Hotels GTHA... · 2020. 10. 28. · Conference Board of Canada, Canadian Outlook Autumn 2019, Scotiabank Group – Global Forecast Update July 2019; CIBC World Markets

GREATER TORONTO HOTEL ASSOCIATION

ACCOMMODATION OUTLOOK

2020

2 CBRE HOTELS | GTHA 2020 OUTLOOKSource: CBRE Hotels’ Trends in the Hotel Industry National Market with reproduction and use of information subject to CBRE Limited Disclaimer | Terms of Use as detailed at https://www.cbre.ca/en/real-estate-services/business-lines/valuation-and-advisory-services/hotels-valuation-and-advisory-services/disclaimer

CBRE HOTELS - CANADA

ECONOMIC & TRAVEL OUTLOOKS


NATIONAL ECONOMIC OUTLOOK 2019-2021

$1.96

$2.02

$2.05

$2.08

$2.12

$2.16

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

$1.85

$1.90

$1.95

$2.00

$2.05

$2.10

$2.15

$2.20

2016 2017 2018 2019 P 2020 P 2021 P

% C

HA

NG

E

Real GDP ($2012) % Change

Source: Statistics Canada, Conference Board of Canada, Canadian Outlook Autumn 2019, Scotiabank Group –Global Forecast Update July 2019; CIBC World Markets –Monthly FX Outlook, 2019; RBC – Economic and Financial Market Outlook – 2019


NATIONAL TRAVEL OUTLOOK 2019-2020

KEEP YOUR TABLE WITHIN THE GUIDES

OVERNIGHT TRAVEL 2018 2019 F 2020 P

Business travel domestic 1.8% 2.1% 2.1%

Pleasure travel domestic 1.8% 1.9% 1.6%

Total domestic travel 1.6% 1.6% 1.5%

U.S. Travel 1.2% 3.2% 2.5%

Overseas travel 1.8% 4.7% 4.8%

TOTAL OVERNIGHT TRAVEL 1.6% 2.0% 1.8%

National Accommodation Demand Growth

2.1%* 1.6% 1.8%

Source: Statistics Canada, TSRC (2017) and ITS (2016); The Conference Board of Canada, Autumn 2018/Winter 2019*Actual results as per CBRE Hotels

NATIONAL MARKET &FINANCIAL OUTLOOK


NATIONAL SUPPLY AND DEMAND OUTLOOK

1.1%

1.8% 1.9%2.1%

1.6%1.8%

2018 2019 F 2020 P 2018 2019 F 2020 P

Supply Demand0% 5% 10% 15% 20% 25% 30%ONQCABBCSK

MBNSNBNLPEYKNT

Proportion of National Rooms Supply, 2020


NATIONAL ADR, REVPAR OUTLOOK

ADR GROWTH2018 Actual 4.4%

2019 Forecast 2.5%

2020 Projection 3.0%

RevPAR GROWTH2018 Actual 5.5%

2019 Forecast 2.3%


Demand GROWTH2018 Actual 2.1%

2019 Forecast 1.6%


2017 2018 2019 F 2020 P

Occupancy 66% 66% 66% 66%

ADR $155 $162 $166 $171

RevPAR $102 $107 $110 $113


NATIONAL BOTTOM LINE OUTLOOK

$15.8 $16.1

$16.7

2018 2019F 2020P

Adjusted Net Operating Income/

Available Room ($000’s)

10.7%

2.4%

3.5%

MAJOR MARKET OUTLOOKS


2020 MAJOR MARKET OUTLOOKS REVPAR PROJECTION

*”Major Markets” refer to Greater Metro Areas

2020 RevPAR Ranking Vancouver $193

Toronto $142

Montreal $141

Quebec City $132

Ottawa $125

Niagara Falls $122

Halifax $110

Calgary $91

Winnipeg $90

Saskatoon $76

St. John’s $73

Edmonton $73

Regina $68

-1.0%

1.0%

3.0%

5.0%

7.0%

Vanc

ouve

r

Que

bec

City

Regi

na

Nia

gara

Fal

ls

Mon

treal

St. J

ohn'

s

Cal

gary

Toro

nto

Otta

wa

Hal

ifax

Edm

onto

n

Sask

atoo

n

Win

nipe

g

> 4% RevPAR Growth

0% - 4% RevPAR Growth

RevPARDecline

ONTARIO MARKET &FINANCIAL OUTLOOKS


ONTARIO – GDP GROWTH

Source: Scotiabank Global Outlook, July 2019

1.9%

1.4%

2.0%

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

Real GDP Growth

2018 2019F 2020P

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

2016 2017 2018 2019F 2020F

Ontario Economic Outlook

Real GDP at Basic Prices ($2012) Household Income per Capita

Total Employment

Source: Conference Board of Canada, Metro Outlook 1, Spring 2019


ONTARIO TRAVEL OUTLOOK 2018-2020 F





U.S. Travel -0.8% 3.0% 2.5%

Overseas travel -2.1% 4.1% 4.3%


Accommodation Demand Growth

1.9%* 1.0% 1.5%

Source: Canadian Tourism Research Institute, Conference Board of Canada, Autumn 2018/Winter 2019*Actual results as per CBRE Hotels


ONTARIO SUPPLY & DEMAND OUTLOOK

0.7%

2.0%

2.4%

1.9%

1.0%

1.5%

2018 2019 F 2020 P 2018 2019 F 2020 P

Supply Demand


ONTARIO SUPPLY GROWTH VS. DEMAND GROWTH

-6.0%

-4.0%

-2.0%

0.0%

2.0%

4.0%

6.0%

8.0%

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 F 2020 P

Supply Growth Demand Growth


ONTARIO SUPPLY OUTLOOK 2020

8.6%

3.6% 3.6%2.8%

1.6% 1.2%

0.0% 0.0%0.0%1.0%2.0%3.0%4.0%5.0%6.0%7.0%8.0%9.0%

10.0%

2020 Supply Growth (%)

Other Significant Supply Growth Markets (2020)

Belleville/Quinte West/Napanee

Kitchener-Waterloo-Cambridge

Brockville/Kingston

Hamilton/Brantford

Owen Sound/Collingwood/Orillia


ONTARIO DEMAND, ADR, REVPAR & MARKET OUTLOOK

ADR GROWTH2018 Actual 4.7%

2019 Forecast 3.0%


RevPAR GROWTH2018 Actual 5.8%

2019 Forecast 2.0%


Demand GROWTH2018 Actual 1.9%

2019 Forecast 1.0%


2017 2018 2019 F 2020 P

Occupancy 69% 70% 69% 69%

ADR $155 $162 $167 $172

RevPAR $107 $113 $116 $118


ONTARIO BOTTOM LINE OUTLOOK

$17.1$17.5

$17.8

2018 2019 F 2020 P

Adjusted Net Operating Income/

Available Room ($000’s)

9.6%

2.1%

1.9%


OTHER ONTARIO MAJOR MARKET OUTLOOKS

KEEP YOUR TABLE WITHIN THE GUIDESNiagara Falls 2017 2018 2019 F 2020 P

Occupancy 68% 67% 68% 68%

ADR $161 $167 $173 $180

RevPAR $109 $112 $117 $122

Ottawa 2017 2018 2019 F 2020POccupancy 75% 74% 72% 71%

ADR $172 $169 $173 $176

RevPAR $128 $124 $123 $125

ECONOMIC & TRAVEL OUTLOOKS FOR THE GTA


GTA ECONOMIC INDICATORS

Source: Conference Board of Canada, Metropolitan Outlook I, Spring 2019

Source: CBRE Hotels

2018 Actual 2019 Forecast 2020 Forecast

Job Growth 63,400 45,400 65,500

Unemployment Rate 6.1% 5.9% 5.6%

Household Income Per Capita Growth 2.8% 1.6% 2.5%

Housing Starts 41,107 36,850 38,420

GDP Growth 2.4% 2.4% 2.4%


MAJOR NEW BUILDS PIPELINE


GTA TRAVEL INDICATORS





U.S. Travel -1.0% 3.6% 3.2%

Overseas travel -0.9% 5.0% 5.2%


GTA Accommodation Demand Growth

1.8%* 0.4% 1.8%

*Denotes actual historic performanceSource: Conference Board of Canada, Metropolitan Travel Outlooks, Autumn 2018/Winter 2019 ; CBRE Hotels


GTA AIR PASSENGERS BY AIRPORT

Source: Statistics Canada, GTAA, Ports Toronto

39.6 42.847.1 49.5

2.52.7

2.8 2.8

0

10

20

30

40

50

60

2015 2016 2017 2018

Pearson Billy Bishop

Pass

eng

ers

(Mill

ion

s)


Strong pace 20212022 has been identified as a potential ”need” year

CITY WIDE STATS 2019 AND 2020

44Events Booked

>496,000Occupied Room Nights

Source: Tourism Toronto

>269,000Estimated Delegates


FUTURE CITY WIDE BOOKING MARCH 2019 – JUNE 2029

96Future Events Booked

586,305Estimated Delegates

$1.9B Estimated Economic Impact

Source: Tourism Toronto

~1.13 millionEstimated Occupied Room Nights


CITYWIDE CONVENTIONS

010,00020,00030,00040,00050,00060,00070,00080,000

Q1 Q2 Q3 Q4

Major Citywides 2019 & 2020 -Distribution by Quarter (Attendance)

Attendance 2019 Attendance 2020

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

Q1 Q2 Q3 Q4

Major Citywides 2019 & 2020 -Distribution by Quarter (ORNs)

ORN 2019 ORN 2020


CITYWIDE DELEGATES

60.0%

62.0%

64.0%

66.0%

68.0%

70.0%

72.0%

74.0%

76.0%

78.0%

80.0%

0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

2012 2013 2014 2015 2016 2017 2018

City Wide Delegates and Hotel Occupancy

# of Delegates Hotel Occupancy (GTA) Hotel Occupancy (DT Toronto)


TOP FIVE CITYWIDE CONVENTIONS 2020(BY ATTENDANCE)

Top Five Citywide Conventions - 2020 Attendance Total Occupied Room Nights

Collision Conference (June 22-25) 30,000 62,100

American Academy of Neurology (Apr 22- May 3) 10,000 36,123

Little Native Hockey League (LNHL) (Mar 14-20) 10,000 5,700

Ontario Volleyball Association – Ontario Championships (Apr 15-21) 7,200 6,154

IMM International (Aug 8- 11) 7,000 16,800

Source: Tourism Toronto, August 2019; CBRE Hotels

GTA OVERALL & SUB-MARKETS MARKET & FINANCIAL OUTLOOKS


MARKET OUTLOOKS - DOWNTOWN TORONTO

1 Drake Hotel (Expansion)2 Kimpton St. George3 Hotel X4 Park Hyatt5 51 Camden6 King Blue


MARKET OUTLOOKS – DOWNTOWN TORONTO

2017 2018 2019 F 2020 P

Downtown

Rooms 17,126 17,050 17,274 17,489

Occupancy 77% 78% 78% 78%

ADR $236 $251 $256 $264

RevPAR $181 $197 $199 $205

% Change

Supply 0.2% -0.4% 1.3% 1.2%

Demand 0.6% 1.6% 0.5% 1.0%

ADR 8.2% 6.3% 2.0% 3.0%

RevPAR 8.6% 8.5% 1.2% 2.8%


DOWNTOWN TORONTO HOTEL DEMAND

-3.9%

-1.2%

-3.6%

1.9%

-1.3%-1.4%

-4.4%

-7.0%-6.0%-5.0%-4.0%-3.0%-2.0%-1.0%0.0%1.0%2.0%3.0%4.0%5.0%

$0

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

$350,000

$400,000

$450,000

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

2017 ORNs 2018 ORNs 2019 ORNs % Change


TORONTO AIRPORT

1 Four Points – Toronto Airport East (Conversion)

2 Element Toronto Airport


MARKET OUTLOOKS – GTA AIRPORT

2013 2017 2018 2019 F 2020 P

Airport

Rooms 8,121 8,121 8,653 8,651 8,895

Occupancy 71% 78% 79% 78% 78%

ADR $107 $142 $154 $158 $162

RevPAR $76 $110 $121 $123 $126

% Change

Supply 0.0%* 0.0% 6.6% 0.0% 2.8%

Demand 17.7%* 1.1% 8.0% -0.5% 2.0%

ADR 43.6%* 12.2% 8.2% 2.5% 3.0%

RevPAR 58.7%* 13.4% 9.7% 2.0% 2.2%*percentage change from 2013 to 2018


MARKET OUTLOOKS – GTA WEST

1 Holiday Inn - Mississauga Toronto West2 Home2 Suites & Hilton Garden Inn Brampton3 Courtyard Burlington4 Residence Inn Courtney Park Mississauga5 Park Inn by Radisson Brampton6 Hyatt Place Mississauga Centre7 The Pearle Hotel & Spa, Autograph Collection8 Holiday Inn Express - Mississauga9 Residence Inn Toronto Mississauga Southwest -

Erin Mills10 Delta Hotels Toronto Mississauga11 Hampton Inn & Suites Burlington12 Chandni, a BW Signature Collection Hotel -

Mississauga


MARKET OUTLOOKS – GTA WEST

2017 2018 2019 F 2020 P

West

Rooms 8,459 8,564 9,019 9,793

Occupancy 75% 75% 72% 68%

ADR $125 $134 $137 $140

RevPAR $93 $100 $99 $95

% Change

Supply 0.9% 1.2% 5.3% 8.6%

Demand 3.3% 1.4% 1.5% 3.0%

ADR 6.5% 7.0% 2.5% 2.0%

RevPAR 9.0% 7.2% -1.2% -3.2%


MARKET OUTLOOKS – GTA EAST/NORTH

1 Comfort Inn & Suites - Bowmanville2 Toronto Marriott Markham Hotel3 Courtyard/TownePlace Suites Oshawa4 Microtel Inn & Suites - Aurora5 Tru by Hilton Markham


MARKET OUTLOOKS – GTA EAST/NORTH

2017 2018 2019 F 2020 P

East/North

Rooms 10,617 10,684 10,942 11,117

Occupancy 73% 72% 71% 71%

ADR $131 $138 $141 $144

RevPAR $96 $100 $99 $102

% Change

Supply 0.7% 0.6% 2.4% 1.6%

Demand 4.0% -0.2% 0.0% 2.0%

ADR 7.2% 4.9% 2.0% 2.5%

RevPAR 10.8% 4.0% -0.4% 2.9%


TORONTO SUPPLY AND DEMAND OUTLOOK

1.0%

2.0%

3.0%

1.8%

0.5%

2.0%

2018 2019 F 2020 P 2018 2019 F 2020 P

Supply Demand

Source: CBRE Hotels


MARKET OUTLOOKS – GTA OVERALL

2017 2018 2019 F 2020 P

Total GTA

Rooms 44,503 44,951 45,886 47,294

Occupancy 76% 76% 75% 74%

ADR $172 $183 $187 $192

RevPAR $130 $139 $140 $142

% Change

Supply 0.4% 1.0% 2.1% 3.1%

Demand 2.1% 1.8% 0.4% 1.8%

ADR 7.9% 6.0% 2.2% 2.6%

RevPAR 9.7% 6.9% 0.5% 1.3%


SEASONALITY 2017, 2018, AND YTD JULY 2019

Source: CBRE Hotels

0%

20%

40%

60%

80%

100%

$0

$50

$100

$150

$200

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

2017 ADR 2018 ADR 2019 ADR 2017 Occ 2018 Occ 2019 OCC


NORTH AMERICAN MAJOR CITY COMPARISON 2019

Source: CBRE Hotels

New York Boston ChicagoOccupancy 86% ∆ -1.5% 75% ∆ -1.6% 70% ∆ 0.3%

ADR $255 ∆ -2.7% $203 ∆ 1.9% $148 ∆ -0.3%

RevPAR $219 ∆ -4.1% $151 ∆ 0.3% $103 ∆ 0.0%

Downtown Toronto CAD Downtown TO USD 2019F ∆Occupancy 78% 78% ∆ -0.6%

ADR $256 $193 ∆ 2.0%

RevPAR $199 $150 ∆ 1.2%


FINANCIAL OUTLOOK - GTA

NOTE: Adjusted Net Operating Income is defined as income after property taxes, insurance, management fees, franchise fees, and capital reserves; but before rent, interest, income taxes, depreciation and amortization. Source: CBRE Hotels

$14.

2

$14.

6

$18.

6

$25.

3

$15.

8

$16.

1

$19.

7

$27.

7

$16.

1

$16.

6

$19.

5

$27.

7

$16.

7

$17.

2

$19.

8

$28.

6

National Central GTA Downtown Toronto

Adj

uste

d N

et O

pera

ting

Inco

me

Per

Ava

ilabl

e Ro

om ($

000’

s)

2017 2018 2019F 2020P

Valuation & Advisory Services BrokerageDavid LaroneBrian StanfordFran Hohol

Bill StoneGreg KwongDeborah BorotsikMichael BeckleySylvia OcchiuzziCorbin StaniloffPawan SaxenaEmily Whyte

David FergusonRebecca GodfreyKirstin HallettNicole NguyenCailin Sully-DanielsScott ForlerCarol LopesHildegard SnelgroveJoann Ma


DISCLAIMER

All information contained in this document as well as in CBRE Limited (“CBRE”) publications, or otherwise provided by CBRE isdesigned as a reference and a management tool for the internal use of companies and agencies involved in the travel and tourism industry. Reproduction and quotation in documents and matters relating to provision of third party consulting advice,business planning, solicitation of public funds, debt and equity financing, litigation, property tax or other legal and financial matters is NOT PERMITTED without the written permission of CBRE. Quotation and reproduction of this material is permitted otherwise ONLY if credited to CBRE and referencing our disclaimer as follows: Source: CBRE Limited with reproduction and use of information subject to CBRE Limited Disclaimer / Terms of Use as detailed at https://www.cbre.ca/en/real-estate-services/business-lines/valuation-and-advisory-services/hotels-valuation-and-advisory-services/disclaimer

Users of this information are advised that CBRE Limited does not represent the information contained herein to be definitive or all-inclusive. CBRE Limited believes the information to be reliable, but is not responsible for errors or omissions.

https://www.cbre.ca/en/real-estate-services/business-lines/valuation-and-advisory-services/hotels-valuation-and-advisory-services/disclaimer

THANK YOU

Greater Toronto hotel associationCBRE Hotels - CanadaSlide Number 3NATIONAL ECONOMIC OUTLOOK 2019-2021National travel outlook 2019-2020Slide Number 6National supply and demand outlookNATIONAL adr, RevPAR outlookNational Bottom line OutlookSlide Number 102020 Major Market Outlooks RevPAR ProjectionSlide Number 12ONTARIO – GDP GrowthOntario travel outlook 2018-2020 FOntario supply & Demand outlookOntario Supply growth vs. Demand GrowthOntario Supply outlook 2020Ontario Demand, ADR, RevPAR & market outlookOntario Bottom Line OutlookOther Ontario Major Market OUTLOOKSSlide Number 21GTA Economic IndicatorsMajor New Builds PipelineGTA Travel IndicatorsGTA Air Passengers by Airportcity wide Stats 2019 and 2020Future city wide booking March 2019 – June 2029Citywide ConventionsCITYWIDE DELEGATESTop Five Citywide Conventions 2020�(by attendance)Slide Number 31Market Outlooks - Downtown TorontoMarket Outlooks – Downtown TorontoDowntown Toronto Hotel DemandToronto AirportMarket Outlooks – GTA AirportMarket Outlooks – GTA WESTMarket outlooks – GTA westSlide Number 39Market outlooks – GTA East/NorthToronto supply and demand outlookMarket Outlooks – GTA overallSeasonality 2017, 2018, and YTD July 2019North American Major City Comparison 2019Financial outlook - GTASlide Number 46disclaimerThank you

CBRE HOTELS Hotels GTHA... · 2020. 10. 28. · Conference Board of Canada, Canadian Outlook Autumn 2019, Scotiabank Group – Global Forecast Update July 2019; CIBC World Markets

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