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Suntrust Robinson Humphrey December 2019 Hotel P&L Analyzer

December Hotel P&L Analyzer: +70bps y/y on +5.3% Total RevPAR growth

4Q: +35bps, above our initial forecast of ~ -10bps; a modest + for hotel REITS

What's Incremental To Our View

Based on “big data” observations from ~1,000 higher-rated U.S. hotels (data source: HotStats) in our hotel data analytics lab: December: 70 bps of GOP margin growth on +5.3% Total RevPAR (Rooms RevPAR + outside-of-the-room spend).

4Q leisure demand around New Year's was above our expectations. We assume the bigger beneficiaries are REITS with high-rated urban hotels/resort in popular NYE markets (especially PEB, HST, and DRH).

We are introducing our 1Q20 margin forecast of flat to -75 bps and 2Q20 margin forecast of -50 bps to +25 bps. Our 2020 forecast holds at -25 to -125 bps.

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