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Amy Shim Chariel Sebarillo Devyn Nourie

​

Hospitality Management

St. John’s University, NYC

2018 STR STUDENT MARKET STUDY COMPETITION

November 11, 2018 @ JACOB JAVITS CONVENTION CENTER, NYC

HOTEL

MARKET STUDY

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CONTENTS OF PRESENTATION

  • ​

1. INTRODUCTION OF DENVER

2. GENERAL MAKEUP OF DENVER MARKET

3. CURRENT STATISTICS

4. TRENDED DATA

5. MARKET BREAKDOWN & TYPES OF BUSINESS

6. PIPELINE AND DEVELOPMENT DATA

7. SUMMARY & CLOSING

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#1

INTRODUCTION OF DENVER

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  • Population: 700,000
  • Tourists: 84.7 million including, Denver had a record 17.4 million total overnight visitors in 2017
  • 81% out-of-state travelers (2017)
  • Tourism supports 59,300 (as of 2017) jobs in metro
  • Denver visitors spent more than $1.7 billion in Denver hotels
  • Top metro areas sending visitors to Denver
  • Los Angeles
  • New York
  • Chicago
  • Albuquerque/Santa Fe
  • Dallas/Fort Worth

https://www.denver.org/articles/post/tourism-records-in-2017/

https://www.9news.com/article/news/travel/the-most-visited-cities-in-colorado-in-2017-and-where-the-tourists-are-coming-from/73-571303703

I. INTRODUCTION OF DENVER: Denver Tourism

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https://medium.com/migration-issues/a-population-history-of-denver-8a6804e3dac5

I. INTRODUCTION OF DENVER

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https://medium.com/migration-issues/a-population-history-of-denver-8a6804e3dac5

I. INTRODUCTION OF DENVER

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https://medium.com/migration-issues/a-population-history-of-denver-8a6804e3dac5

I. INTRODUCTION OF DENVER

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*pictures of companies & year established*

DaVita in 2009

Arrow in 2011

Molson Coors in 1873

Top Companies located in the Denver Metropolitan Area

based on Forbes Fortune 500

Dish in 1981

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Universities Located in Denver

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Stapleton International Airport (1929-1995)

Denver International Airport (1994-Present)

Porter Adventist Hospital

Parker Adventist Hospital

University of Colorado Hospital

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Major Events in Denver

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16th Street Mall

Denver Union Station

Elitch Gardens Water and Theme Park

Top Attractions In Denver

Brewery Tours

History Colorado Center

Denver Botanic Gardens

Red Rocks Park & Amphitheatre

Rocky Mountain National Park

Colorado Railroad Museum

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KEY TAKEAWAYS

“Inflow of tourists to Denver”

​

  • Continuously growing travel city (Suburban areas)
  • Out-of-state traveler (81% in 2017)
  • Unique travel attractions
  • Popularity of beer festivals
  • Significant impact of Marijuana in tourism (2014)
  • International airport expansion

​

​

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#2

GENERAL MAKEUP OF

DENVER MARKET

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West Region

​

Southern Region

​

Airport/East Region

​

North Region

​

Denver CBD

​

Denver Tech Center

II. MARKET: GEOGRAPHICAL LOCATIONS BY SUBMARKET

​

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Denver Area

II. MARKET: DENVER REGION, 2000-2016 PER CAPITA INCOME

​

​

http://www.city-data.com/income/income-Denver-Colorado.html

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​

Count of Class

Sum of Rooms

Luxury Class

11

1946

Upper Upscale Class

38

11840

Upscale Class

81

12495

Upper Midscale Class

84

9402

Midscale Class

45

4334

Economy Class

136

8025

Grand Total

395

48042

*within the main Denver city

II. MARKET: PROPERTIES AND ROOMS BY CLASS

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Row Labels

Economy

Luxury

Midscale

Upper Midscale

Upper Upscale

Upscale

Grand Total

Adams County

1806

0

1124

683

678

1272

5563

Arapahoe County

1923

0

945

1258

801

2157

7084

Broomfield County

0

0

83

556

837

633

2109

Denver County

2406

1946

1684

4699

8254

6648

25637

Douglas County

329

0

63

1070

279

866

2607

Jefferson County

1561

0

435

1136

991

919

5042

Total

8025

1946

4334

9402

11840

12495

48042

0

5,000

10,000

II. MARKET: CENSUS ROOMS BY CLASS AND COUNTIES

​

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Size

Census Properties

Census Rooms

Less than 75

123

3,158

76-150

181

20,624

151-250

64

12,367

251-500

20

6,593

More than 500

7

5,145

II. MARKET: PROPERTIES AND ROOMS BY STR STANDARDIZED SIZE

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II. MARKET: CENSUS PROPERTIES BY OPERATION

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10,879

5,550

5,197

4,451

3,013

2,365

1,861

II. MARKET: ROOMS BY PARENT COMPANY

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Years Open

Census Properties

1910s

2

1920s

0

1930s

1

1940s

1

1950s

8

1960s

3

1970s

6

1980s

28

1990s

59

2000s

127

2010s

145

Total

395

II. MARKET: PROPERTIES AND ROOM BY HOTELS OPEN

​

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Gaylord Rockies Resort & Convention Center

Gaylord

1,501

Sheraton Hotel Denver

Sheraton Hotel

1,231

Hyatt Regency Denver At Colorado Convention Center

Hyatt Regency

1,100

Hilton Denver City Center

Hilton

613

Marriott Denver Tech Center

Marriott

605

Doubletree Denver

DoubleTree

561

Grand Hyatt Denver

Grand Hyatt

516

Gaylord Rockies Resort & Convention Center

Sheraton Hotel Denver

Hyatt Regency Denver

II. MARKET: Top Hotels by room size

(Marriott, Will be opened soon)

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II. MARKET: MOST HISTORIC HOTEL: THE OXFORD EST. 1890

​

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KEY TAKEAWAYS

“Rapid growth after millennium…”

​

  • There are more economy-class hotels than other classes.
  • (Upper) Upscale-class hotels supply the most hotel rooms.
  • International Marriott brand hotels (Gaylord, Sheraton, Marriott, are dominant.
  • After millennium, 68.9% hotels were established.
  • Denver downtown & Greenwood Village – High income/stronger economy

​

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Takeaways

#3

CURRENT STATISTICS

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1 For 2017 2 For 2013 3 For 2016

29

Market

Hotel Census Population

Census Rooms

Tourism Population

Occ. Increase per yr.

Denver

347

48,046

31.7 M*1

-0.30%

Boston

380

55,133

28 M*1

1.30%

Dallas

665

83,287

24.7 M*1

-1.40%

Phoenix

463

64,154

22 M*1

0.90%

Memphis

250

23,265

11 M*1

1.20%

Salt Lake City

189

23,028

​

3.60%

Minneapolis

343

42,196

30.9 M*2

-1.60%

New Orleans

293

40,378

10.98 M*1

-.90%

Portland

80

6,999

5.4 M*3

1.90%

Tampa

465

46,225

22.6*3

1.30%

Based on tourism visits, city size, and hotel census from 2013, 2016, and 2017.

III. STATS: MARKET STUDY OF SIMILAR CITIES

​

​

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III. STATS: MARKET DATA BY MEASURE

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III. STATS: TOP HOTELS IN DENVER BASED ON TRIPADVISOR REVIEW RATES

Rank

Hotel

Rate

# of reviews

1

Hyatt Regency Denver At Colorado Convention Center

4.5/5

4,951

2

HYATT House Denver Airport

4.5/5

1,047

3

Hyatt Place Denver/Cherry Creek

4.5/5

825

4

The Maven Hotel

4.5/5

293

5

Hyatt Place Denver/Downtown

4.5/5

798

6

the ART, a hotel

4.5/5

862

7

Comfort Inn Central

4.5/5

426

8

Drury Inn & Suites Denver Stapleton

4.5/5

433

9

The Westin Denver International Airport

4.5/5

1,102

10

Warwick Denver Hotel

4/5

1,698

11

Kimpton Hotel Monaco Denver

4.5/5

1,561

12

Embassy Suites by Hilton Denver - Downtown / Convention Center

4.5/5

3,023

13

The Curtis Denver - a DoubleTree by Hilton Hotel

4/5

2,075

14

Hampton Inn & Suites Denver/Airport-Gateway Park

4.5/5

953

15

Homewood Suites by Hilton Denver Downtown-Convention Center

4.5/5

1,272

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III. STATS: TOP HOTELS IN DENVER BASED ON TRIPADVISOR REVIEW RATES

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​

Total Hotels

Total Rooms

Total Hotel Pipeline Projects

Total Room Pipeline Projects

Luxury

4

1,153

0

0

Upper Upscale

33

11,491

4

2,132

Upscale

77

12,438

25

3,313

Upper Midscale

78

9,090

29

3,368

Midscale

41

4,334

15

1,437

Economy

51

5,615

0

0

Independent

63

3,925

3

320

III. STATS: PIPELINE BY BRAND SUMMARY

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Year

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

Supply

1.3%

1.5%

2%

2%

0.6%

1.8%

1.4%

1.2%

2.2%

1.1%

3.7%

4.3%

Demand

5%

3%

-2%

-6.7%

9.9%

5.8%

4%

6.8%

8.8%

1.5%

1%

4%

III. STATS: SUPPLY & DEMAND % CHANGE FROM PREVIOUS YEAR

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0

500,000

1 mill.

1.5 mill.

2 mill.

14.3 million rooms

8.2 million rooms

12.3 million room

16.7 million rooms

2011

2017

III. STATS: DENVER RECORD ROOM SUPPLY AND DEMAND

​

​

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Year

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

RevPAR

15.1

12

2.4

-19.5

10.4

7.6

5.7

8.4

16.1

7.9

2.7

2.7

III. STATS: REVPAR % CHANGE FOR YEARS 2006-2017

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KEY TAKEAWAYS

“TOWARD HIGH ADR”

​

  • After 2009, tourism demand has been quickly recovered.
  • RevPAR has been improved by the pricing strategy (high ADR).
      • In 2014, 16.1% increase
  • Upscale-class/upper-mid-class hotels will show up soon.
  • Upscale hotels have received higher online review rates (customer satisfaction).

​

​

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Takeaways

#4

TRENDED DATA

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(12-Month Analysis for 2017)

​

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Room Supply

3.3

3.5

3.6

3.6

3.4

3.9

4.2

4.3

5.3

5.1

5.5

5.8

Room Demand

-0.6

-2.8

7.1

-1.5

9.6

3.7

1.2

3.8

4.1

7.3

8.7

6.6

IV. TRENDED DATA: ROOM SUPPLY & DEMAND PERCENT CHANGE

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​

Total Supply

Total Demand

2006

1.3

5.0

2007

1.5

3.0

2008

2.0

-2.0

2009

2.0

-6.7

2010

0.6

9.9

2011

1.8

5.8

2012

1.4

4.0

2013

1.2

6.8

2014

2.2

8.8

2015

1.1

1.5

2016

3.7

1.0

2017

4.3

4.0

IV. TRENDED DATA: ROOM SUPPLY & DEMAND PERCENT CHANGE

(2006-2017 total analysis)

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(2006-2017 Analysis)

Year

Actual Occupancy

Actual ADR

2006

64.4

$90.02

2007

65.4

$99.34

2008

62.8

$105.85

2009

57.5

$93.11

2010

62.8

$94.03

2011

65.3

$97.30

2012

67.0

$100.26

2013

70.8

$102.93

2014

75.3

$112.30

2015

75.6

$120.83

2016

73.6

$127.47

2017

73.4

$131.31

IV. TRENDED DATA: ACTUAL OCCUPANCY & ADR

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​

Occupancy %

ADR

2006

3.7

11.0

2007

1.5

10.3

2008

-3.9

6.6

2009

-8.5

-12.0

2010

9.3

1.0

2011

3.9

3.5

2012

2.6

3.0

2013

5.6

2.7

2014

6.4

9.1

2015

0.3

7.6

2016

-2.6

5.5

2017

-0.3

3.0

IV. TRENDED DATA: OCCUPANCY & ADR % CHANGE

(2006-2017 Analysis)

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Year

RevPAR % Change

RevPAR Actual

2006

15.1

57.99

2007

12

64.93

2008

2.4

66.51

2009

-19.5

53.53

2010

10.4

59.08

2011

7.6

63.55

2012

5.7

67.2

2013

8.4

72.85

2014

16.1

84.58

2015

7.9

91.3

2016

2.7

93.8

2017

2.7

96.32

IV. TRENDED DATA: REVPAR PERCENT CHANGE AND ACTUAL

(2006-2017 Analysis)

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KEY TAKEAWAYS

“Aggressively monetize effective ADRs”

​

  • In 2010 and 2014, demands were popped from the previous years.
  • After 2009, RevPAR has continuously increased ($53.5 → $96.3).
  • ADRs have been fluctuating in different seasons.
  • Lower ADRs in 2009, but significantly increase after 2014
  • Growth in Mar, May and Oct-Dec in 2017 (not vacation season)
  • In 2017, OCC-73.4% in Denver (In the US, 65.9%)

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Takeaways

#5

MARKET BREAKDOWN

& TYPES OF BUSINESS

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Class

Supply

Demand

Luxury

11.8

11.1

Upper Upscale

4.4

4.2

Upscale

4.2

2.5

Upper Midscale

5.3

4.4

Midscale

1.9

-0.3

Economy

0.3

-2.6

V. MARKET BREAKDOWN: SUPPLY & DEMAND ON CLASS

(12 month analysis from 2017)

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Class

OCC%

ADR

Luxury

75.1

$248.06

Upper Upscale

71.9

$167.77

Upscale

75.7

$135.49

Upper Midscale

74.1

$117.38

Midscale

71.8

$92.51

Economy

71.1

$69.66

(12 month average analysis of 2017)

​

V. MARKET BREAKDOWN: OCCUPANCY & ADR RATE BASED ON CLASS

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Class

OCC%

ADR

Luxury

-0.7

0.1

Upper Upscale

-0.1

3.1

Upscale

-1.6

2.8

Upper Midscale

-0.9

3

Midscale

-2.1

4.4

Economy

-2.9

5.9

V. MARKET BREAKDOWN: OCCUPANCY & ADR RATE BASED ON CLASS

(12 month analysis from 2017)

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Class

RevPAR

% Change

Luxury

$186.24

-0.6

Upper Upscale

$120.63

3

Upscale

$102.52

1.1

Upper Midscale

$86.98

2.1

Midscale

$66.39

2.2

Economy

$49.51

2.8

V. MARKET BREAKDOWN: OCCUPANCY & ADR RATE BASED ON CLASS

(12 month analysis from 2017)

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​

Jan

Feb

Mar

Apr

May

June

July

Aug

Sept

Oct

Nov

Dec

Occ %

59.8

62.3

71.8

69.0

81.4

88.0

84.7

83.7

82.2

78.1

64.0

54.8

ADR

115.42

116.05

121.70

122.87

132.45

146.68

141.78

141.21

139.58

143.27

125.00

107.86

RevPAR

68.97

72.24

87.34

84.82

107.82

129.08

120.05

118.16

114.70

111.88

79.94

59.08

V. MARKET BREAKDOWN: OCCUPANCY, ADR, REVPAR BY MONTH

12-Month Analysis of 2017

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​

Occ %

ADR ($)

2010

63.1

98.13

2011

65.6

101.43

2012

67.2

104.68

2013

70.6

107.13

2014

75.2

116.25

2015

75.4

124.82

2016

73.3

131.86

2017

72.9

135.79

(2010-2017 Total Analysis)

V. TYPES OF BUSINESS: WEEKDAY ACTUAL OCCUPANCY % AND ADR

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​

Occ %

ADR ($)

2010

62.2

83.71

2011

64.5

86.92

2012

66.6

89.02

2013

71.3

92.50

2014

75.6

102.43

2015

75.9

110.90

2016

74.4

116.88

2017

74.4

120.30

V. TYPES OF BUSINESS: WEEKEND ACTUAL OCCUPANCY % AND ADR

(2010-2017 Total Analysis)

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KEY TAKEAWAYS

“Luxury, upper-upscale, upscale, ...”

​

  • Growing interests (demand and supply) in luxury hotels
  • Overall, ADRs have increased in 2017 from 2016.
  • June-Aug: the busiest season in terms of RevPAR
    • May-Sep: OCC% is higher than 80%.
  • Dec: the slowest season in terms of RevPAR
    • Dec-Jan: OCC% is lower than 60%.

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Takeaways

#6

PIPELINE AND

DEVELOPMENT DATA

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Number of Rooms

1,153

11,491

12,438

9,090

​

4,324

5,615

4,279

V. PIPELINE & DEVELOPMENT: EXISTING ROOMS AND PIPELINE BY SCALE

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V. PIPELINE & DEVELOPMENT: TOP 10 CHAINS IN PIPELINE (# of ROOMS)

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V. PIPELINE & DEVELOPMENT: TOP 10 CHAINS IN PIPELINE (# of ROOMS)

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KEY TAKEAWAYS

“Gaylord, coming soon!”

​

  • In 2018, many rooms of (upper-) upscale and upper-midscale hotels were increased.
  • Upper-upscale hotel rooms will be added very soon.
  • Upscale and upper-midscale hotel rooms will be constructed.
  • Gaylord Rockies Resort & Convention Center (1,501 rooms) will significantly influence the market.

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Takeaways

SUMMARY

& CLOSING

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SUMMARY & CLOSING

  • Lots of tourist attractions are the strength factors for the Denver Tourism.
    • New: Intl airport, new hotels, ...
    • Traditional: National parks, festivals, sports, industries, marijuana (*friendly hotels), ...

​

  • Management, mining, education industries boost the local economy.
    • Increasing population and visitors → Lodging demand

​

  • Two momentum points in 2010 and 2014
    • The pricing strategies have been successful
    • Maintaining the OCC% as about 70% and increasing ADRs

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  • Upper-upscale, upscale, upper-midscale hotels are more popular and more effective to enlarge RevPAR.
    • High demand and high supply in 2017
    • Competition in the segments
    • A big impact of new big property “Gaylord” in the market
    • Resort & convention center

​

  • Opportunities: Growth of demand in non-vacation season in 2017
    • Mar, Dec-Jan
    • Leisure travelers (81%) target strategies

SUMMARY & CLOSING

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  • Keep monitoring the demand/supply changes for pricing
    • More rooms in Upper-upscale and Upscale induced by the pipeline properties → Decreasing OCC%
    • International airports/ popular events/ economy development → Increasing OCC%
  • Differentiation strategies/ marketing
    • Unique themes or product/services in the upscale segments
    • Attractions for residents (e.g., unique bar/social gathering spaces/rooftop, special themes, concierge/tour programs)
  • Marketing to attract guests through the early spring, late fall, and winter

FUTURE CONSIDERATIONS

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THANK YOU

FOR YOUR ATTENTION

ANY QUESTIONS?