ACVB BOARD OF DIRECTORS MEETING (Annual meeting for bylaws) Wednesday, September 23, 2020 8:00 a.m. via video conference
CALL TO ORDER Jo Ann Herold
Chair, Board of Directors
DESTINATION REPORT Mark Vaughan EVP/CSO
ATLANTA OCCUPANCY – AUGUST 2020 2019 ACVB tax revenue district TITLE
TITLE
123
Atlanta convention hotels
TITLE
TITLE
Source: STR
123
TITLE
TITLE 37.7%
123
123
81.3%
123
Hotels within 1-mile radius of GWCC TITLE 123
Metro Atlanta
76.2%
2020
79.1%
71.2%
36.1% 123
123
123
37.6% 123
123
123 47.6%
KEY SALES ACTIVITIES Year-to-date booking goal – August Year-to-date lead goal – August
PLACE IMAGE HERE
97.6% 53.6%
Direct Sales Events ASAE Annual Meeting (virtual) IAEE Expo! Expo! Holiday Showcase (virtual) PCMA
August December December January
BOOKINGS
GROUP ROOMS
BY EVENT DATE AND STATUS
AUGUST 2020 YTD
City of Atlanta vs. luxury and upper upscale hotels of top 25 markets
AUGUST 2020 – 12 MONTH RUNNING TOTAL City of Atlanta vs. luxury and upper upscale hotels of top 25 markets
FINANCIAL REPORT Gregory Pierce EVP/CAO/CFO
2020 FORECAST ASSUMPTIONS FOR THE PURPOSE OF FINANCIAL PROJECTIONS Hotel revenue for the entire year for the City of Atlanta projected to be down PLACE IMAGE HERE
55% to 60% Average occupancy rate for the entire year for the City of Atlanta projected to be between
36% to 39% @christopherbw
ATLANTA CONVENTION & VISITORS BUREAU STATEMENT OF REVENUE AND EXPENSE (in millions) Revenue – public Revenue – private
ACTUAL FORECAST CURRENT FULL YTD 9/1/20 thru YEAR FORECAST 08/31/20 12/31/20 FYE 12/31/20 Original $7.1 $4.0 $11.1 $27.5 $2.5 $0.0 $2.5 $6.5
Public revenue released/reserves Total revenue
$3.5 $13.1
$1.5 $5.5
$5.0 $18.6
$0.0 $34.0
Direct promotional expense Payroll and related expense
$6.0 $5.9
$1.9 $2.8
$7.9 $8.7
$20.1 $10.2
Operating expense
$1.4
$0.6
$2.0
$3.1
Total expense
$13.3
$5.3
$18.6
$33.4
Excess (deficiency)
($0.2)
$0.2
$0.0
$0.6
ATLANTA CONVENTION & VISITORS BUREAU BALANCE SHEETS (in millions)
AS OF 08/31/20
YE 2019
Var.
Cash and equivalents
$2.4
$3.2
($0.7)
Accounts receivable
$1.5
$5.1
($3.9)
Investments
$7.6
$11.5
($2.4)
Prepaid and other assets
$0.5
$1.0
($0.6)
Property and equipment
$3.1
$4.1
($0.9)
Total assets
$15.1
$24.9
($8.5)
Accounts payable and accruals
$0.9
$1.9
($1.0)
Deferred revenue and liabilities
$8.2
$11.9
($3.5)
Lines of credit
$1.0
$1.7
($1.7)
Lease liability
$0.6
$0.7
$0.0
Fund balance – unrestricted
$4.4
$8.7
($2.3)
Total liabilities and fund balance
$15.1
$24.9
($8.5)
HOTEL MARKET UPDATE “WINTER IS COMING, BUT SPRING LIES AHEAD” Mark Woodworth, Principal R.M. Woodworth & Associates
EXECUTIVE COMMITTEE AND BOARD OF DIRECTORS MEETING
U.S. and Atlanta Lodging Industry Update SEPTEMBER 23, 2020
WINTER IS COMING - JAMIE LANE, CBRE HOTELS
2
U.S. Cases broken down by region
Daily new increase in 7-day moving averages
Northeast
Midwest
West
South
70,000
60,000
Daily Cases
50,000
South: 35% of GDP 38% of Population
Midwest: 19% of GDP 21% of Population
40,000
30,000
West: 26% of GDP 24% of Population
20,000
Northeast: 20% of GDP 17% of Population
10,000
0 3/14 3/21 3/28
4/4
4/11 4/18 4/25
5/2
5/9
5/16 5/23 5/30
6/6
6/13 6/20 6/27
7/4
7/11 7/18 7/25
8/1
8/8
8/15 8/22 8/29
9/5
Source: COVID Tracking Project, US Census, BEA, CBRE Research, Macrobond, 11 Sep 2020. Note: Regions defined by US Census Bureau
The U.S. just about regaining control
Daily new increase in 7-day moving averages (thousands of cases) Midwest
Northeast
3.0 2.5
Illinois
2.0
12
19% of GDP 21% of Population
6
1.0
4
0.5
2
0.0 4/1
5/1
6/1
7/1
8/1
New York
8
1.5
3/1
9/1
0 3/1
4/1
5/1
6/1
12
10
26% of GDP 24% of Population
8 6
7/1
8/1
9/1
South
West
12
20% of GDP 17% of Population
10
California
Florida
35% of GDP 38% of Population
10 8
Texas
6
4
Georgia
4
Arizona
2
2
0
0 3/1
4/1
5/1
6/1
7/1
8/1
9/1
3/1
4/1
5/1
6/1
7/1
8/1
Source: COVID Tracking Project, US Census, BEA, CBRE Research, Macrobond, 10 Sep 2020.
9/1
Stronger than Expected gains in Employment – Doing well Millions
Trend
Total Employment
155
150
11 - 12 Million Left to Recover 145
22 Million Jobs Lost
140
10.5 Million Jobs Gained 4.1 Million in L&H
135
130
125 Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19
Jul-19 Aug-19 Sep-19 Oct-19 Nov-19 Dec-19 Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20
Jul-20 Aug-20
Source: BLS, CBRE Research, August 2020.
Hotels are not benefiting from the employment Recovery Y-o-Y Change in US Employment Total Leisure & Hospitality
Accommodation
Food Services & Drinking Places
Nonfarm, Payroll, Total
Performing Arts & Spectator Sports
Museums, Historical Sites, Zoos, & Parks
0.0% 2/1/2020
3/1/2020
4/1/2020
5/1/2020
6/1/2020
7/1/2020
8/1/2020 -6.8%
-10.0%
-18.7% -20.0% -23.2%
• Accommodation Industry Job gains have stalled since June. • Experience employment (sports/museums/plays, etc.. all still at April levels)
-26.2% -30.0%
-37.0% -40.0%
-46.2%
• Food & Beverage recovering, but can that be sustained with winter coming?
-50.0% -48.5% -60.0%
Source: BLS, CBRE Research, August 2020.
In normal times, the USA hotel industry employs over 8,300,000 people, but less than 53% of these jobs have returned since April
Source: Hotel EffectivenessÂŽ sample of 3,300 same-store hotels across the USA
A larger share of select service hotels in Georgia mean smaller staff per hotel and faster recoveryYTD
Source: Hotel EffectivenessÂŽ sample of 3,300 same-store hotels across the USA
All roles have seen an increase in wages in every market across the USA Seasoned team members reduce operational risk and are the first hired
Hotels retained the most experienced team members and rehired seasoned workers first. Source: Hotel EffectivenessÂŽ
Hourly wages in Atlanta are higher than pre-COVID average, but this is skewed by tenure.
2020 pre/post COVID analysis Hotels retained the most experienced team members and re-hired seasoned workers first. January +7.3%
August
January
August +32.7%
Source: Hotel EffectivenessÂŽ
Housekeeping clean times (minutes per room) have been reduced despite new brand standards Stayover cleans are uncommon, offsetting departure clean MPR increases
26
U.S. Employment Forecasts Current Forecast Scenarios Compared to Last Edition CBRE Q4 2019
CBRE Q1 2020
CBRE Q2 2020
105
100
Q1 2023 Q2 2022 Q4 2020 95
90
85
80
Source: BLS, CBRE Research, August 2020. Note: Employment Indexed to Pre-recession levels
US Airline Passenger Counts Still Depressed vs Drive-ToTraffic Plane Trips
Drive Trips
20.0%
0.0% 2/29
3/31
4/30
5/31
6/30
7/31
8/31
-20.0%
-40.0%
-60.0%
-80.0%
-100.0%
Source: TSA, Arrivalist, CBRE Hotels Research, 9/11/2020 Note: Plane Trips - TSA Passenger Throughput, Drive Trips – Arrivalist tracked Trips away from home greater than 50 Miles
Significant Gains In All Metrics Since April Y-o-Y Change in RevPAR Luxury & Upper Upscale
0% 2/14/2020
3/14/2020
4/14/2020
Y-o-Y Change Upscale & Upper Midscale
5/14/2020
6/14/2020
Midscale & Economy
7/14/2020
8/14/2020
Occ^
0% 2/14/2020
-20%
-20%
-40%
-40%
-60%
-60%
-80%
-80%
-100%
-100%
3/14/2020
ADR^
4/14/2020
5/14/2020
Revpar^
6/14/2020
7/14/2020
8/14/2020
Source: CBRE Hotels Research, Kalibri Labs, Sept 10th, 2020. Note: Covers Kalibri Weekly Sample, not scaled to full U.S. Hotel Industry Representation
Rural/Small Town Come back Strong – Break out Large vs. Midsize Cities 2020 Y-o-Y Change in RevPAR
2020 Y-o-Y Change in RevPAR
Resort / Destination
Rural Area / Interstate
Small City / Town
Urban
Suburban
Airport
Large Metropolitan Area - Urban 20.0%
20.0%
0.0%
0.0% 1
-20.0%
-40.0%
-60.0%
-80.0%
Mid-sized City - Urban
2
3
4
5
6
1
7
2
3
4
5
6
7
-20.0%
-40.0%
-60.0%
-80.0%
-100.0% -100.0%
Source: CBRE Hotels Research, Kalibri Labs, August 2020.
JULY 2020 Top 10 Market Performance (out of 65) RevPAR Rank
Market
Y-o-Y RevPAR
Occupancy
1
San Bernardino
-30.5%
62.8%
2
Virginia Beach
-32.8%
59.7%
3
Oklahoma City
-37.4%
47.4%
4
Tucson
-38.7%
41.4%
5
Birmingham
-40.7%
47.8%
6
Savannah
-42.3%
52.1%
7
Jacksonville
-43.2%
52.3%
8
Memphis
-43.7%
52.0%
9
Richmond
-44.9%
45.3%
10 21
Columbia
-45.9%
43.1%
Atlanta
-54.5%
45.3%
Bottom 10 Markets: Hawaii, New York, Boston, San Francisco, Seattle, Washington DC, Chicago, New Orleans, Orlando, San Jose Source: CBRE Hotels Research, Kalibri Labs, August 2020.
CBRE Hotels - Baseline Forecast- U.S. National RevPAR % of 2019
Year
Occ
ΔOcc
ADR
ΔADR
RevPAR
ΔRevPAR
2018
66.4%
-0.4%
$130.20
2.1%
$86.51
1.7%
2019
66.7%
0.4%
$130.76
0.4%
$87.22
0.8%
100.0%
2020
39.8%
-40.3%
$104.10
-20.4%
$41.46
-52.5%
47.5%
2021
52.3%
31.3%
$111.89
7.5%
$58.51
41.1%
67.1%
2022
60.2%
15.0%
$120.52
7.7%
$72.50
23.9%
83.1%
2023
65.5%
8.8%
$128.90
6.9%
$84.37
16.4%
96.7%
2024
66.6%
1.7%
$134.12
4.1%
$89.27
5.8%
102.3%
2025
67.3%
1.1%
$138.44
3.2%
$93.15
4.4%
106.8%
Source: CBRE Hotels Research, Kalibri Labs, 8/13/2020 – https://pip.cbrehotels.com .
CBRE Hotels – REVPAR Forecast by Chain scale RevPAR as a Percent of 2019 Levels 120%
Recovery Zone
100%
80%
60%
40%
20%
0% 2019
2020 ALL
2021 Luxury
2022 Upper Upscale
Upscale
2023
2024
Upper Midscale
Midscale
2025
2026
Economy
Source: CBRE Hotels Research, Kalibri Labs, 8/13/2020, https://pip.cbrehotels.com .
Turning to Atlanta
Georgia rebound Inline with the National Recovery Occupancy
U.S. 2019
Georgia 2019
U.S. 2020
Georgia 2020
80.0%
70.0%
60.0%
50.0%
40.0%
30.0%
20.0%
10.0%
0.0% 1
2
3
4
5
6
7
Month
Source: CBRE Hotels Research, Kalibri Labs, August 2020.
8
9
10
11
12
Percent of Rooms Closed – Atlanta and Savannah Atlanta, GA
Savannah, GA
30.0%
25.0%
20.0%
15.0%
10.0%
5.0%
0.0%
Source: CBRE Hotels Research, Kalibri Labs, Hotel Compete, Sept 10th, 2020.
Percent of Rooms Closed – Atlanta 70.0%
60.0%
50.0%
40.0%
30.0%
20.0%
10.0%
0.0%
Luxury
Upper Upscale
Upscale
Upper Midscale
Midscale
Economy
Source: CBRE Hotels Research, Kalibri Labs, Hotel Compete, Sept 10th , 2020.
Atlanta Hotel Occupancy by Price Tier 2019 Lower
2020 Lower
2019 Mid
2020 Mid
2019 Upper
2020 Upper
90.0%
80.0%
70.0%
60.0%
50.0%
40.0%
30.0%
20.0%
10.0%
0.0% 1
2
3
4
5
6
7
8
9
10
11
12
Month
Source: CBRE Hotels Research, Kalibri Labs, August 2020.
Atlanta On the Rebound
2020 Monthly Change in Demand/ADR - Upper-Tier Group Channel
2020 Monthly Y-o-Y Change in RevPAR 0% 1
2
3
4
5
6
0.0%
7
1
-10%
2
3
4
5
6
7
-10.0%
-18.2%
-20%
-20.0%
-30%
-30.0%
-40%
-40.0%
-50%
-52.4%
-60%
-27.8%
-50.0% -60.0%
-70% -73.6% -80%
-70.0% -80.0%
-90%
-90.0%
-100%
-92.2%
-100.0%
Lower
Mid
Upper
Demand
ADR
Source: CBRE Hotels Research, Kalibri Labs, August 2020.
Atlanta Occupancy & ADR Forecast – Baseline Scenario
Source: CBRE Hotels Research, Kalibri Labs, August 2020.
The ATLANTA Outlook – A Few different Views RevPAR Index – History & Forecast (2019 = 100)
ADR Outlook by Economic Scenario
140
120
100
80
60
40
20
0 2015
2016
2017
2018 All
2019 Upper
2020
2021 Mid
2022 Lower
2023
2024
2025
Source: CBRE Hotels Research, Kalibri Labs, 8/13/2020, https://pip.cbrehotels.com .
CBRE Hotels - Baseline Forecast- All Atlanta Hotels RevPAR % ΔRevPAR of 2019
Year
Occ
ΔOcc
ADR
ΔADR
RevPAR
2018
69.2%
-1.2%
$115.01
2.3%
$79.59
1.1%
2019
68.5%
-1.0%
$120.28
4.6%
$82.45
3.6%
100.0%
2020
41.3%
-39.7%
$92.11
-23.4%
$38.08
-53.8%
46.2%
2021
51.1%
23.7%
$97.43
5.8%
$49.83
30.8%
60.4%
2022
61.5%
20.3%
$107.35
10.2%
$66.06
32.6%
80.1%
2023
66.8%
8.6%
$115.03
7.2%
$76.85
16.3%
93.2%
2024
70.4%
5.4%
$122.76
6.7%
$86.47
12.5%
104.9%
Source: CBRE Hotels Research, Kalibri Labs, 8/13/2020 – https://pip.cbrehotels.com .
New Supply – Atlanta
Thank you!
mark@rmwoodworth.com
MARKETING REPORT Andrew Wilson EVP/CMO
MARKETING RESULTS YEAR-TO-DATE Impressions: 33 million Engagements: 1.8 million t
Landing page views: 16k Web traffic: -53%
Budget: -40%
PIVOT From
• • •
SXSW activation Cookbook and culinary campaign Festival and event marketing
To
• • •
Photo by Paul Daniel | @pauldaniel5010
Pandemic resources BLM protests Repositioning the Still Atlanta campaign
HIGHLIGHTS
Top performing w ebsite ad Driving traffic to the best Atlanta staycation ideas, receiving 7.5k landing page views
HIGHLIGHTS
Top performing video Repurposed existing premium content from December, which received more than 257k views and 780k impressions
HIGHLIGHTS
Top performing promoted Facebook post UGC video utilizing post copy that encourages audience participation
HIGHLIGHTS
BLM protest response Following a 24-hour pause and solidarity posts, we rolled out an 18-day campaign to spotlight Black leaders that have helped make Atlanta the city it is today. The most extensive response of any DMO More than 300,000 impressions
HIGHLIGHTS
IGTV compilation of the Music Voyager Taste ATL videos
HIGHLIGHTS
Spotlights on Black-ow ned restaurants
STILL ATLANTA
2020 ATLANTA LEISURE CAMPAIGN Recovery and Rebuild
t
•
$145k investment
•
Objective to drive leisure hotel bookings Q3/Q4
•
Target markets: • 6-hour Southeast drive market (weekend getaway) • Metro Atlanta
•
Includes attraction partner and restaurant open messaging
CAMPAIGN TIMELINE AND EXECUTION
Investment June
Social
Radio
$35k
$30k
Digital (Expedia) $80k
Paid social media affinity messaging to lead conversion messaging
July August
September October
Radio promotional giveaways started when Expedia program launched 3-month Expedia program launched July 1
SOCIAL MEDIA AFFINITY CAMPAIGN (ONGOING) Total impressions:
+9 million
Total engagements:
+600k
Landing page views:
16k
Still Atlanta launch video with 225k views and 460k impressions Expedia Facebook Story ad garnered more than 1.6 million impressions
EXPEDIA CAMPAIGN RESULTS (7/1 – 9/13)
$4.3 M
$50 K
$5.4 M
86.6
NEW MARTECH PLATFORM Design and technology agency selected in 2019 •
Madden Media
Objective: To advance ACVB’s marketing capabilities and deliver destination content to leisure travelers, meeting attendees and meeting planners when, where and how they want it Not just a new website
• •
Building a personalization engine Content syndication
ATLANTA.NET
ATLANTAMEETINGS.COM
ATLANTA.NET
DISCOVERATLANTA.COM
ATLANTAMEETINGS.COM
DISCOVERATLANTA.COM
DISCOVERATLANTA.COM
NEXT STEPS SEPTEMBER • Roll out DiscoverAtlanta.com • Atlanta.net and AtlantaMeetings.com remain live with redirects • Request image and content updates from members and stakeholders
• Staff and partner feedback, refinements
OCTOBER • Focus on enhanced culinary content to leverage four Voyager TV episodes and Fearless Innovation cookbook • Redesign and align AtlantaNow and Planner’s Guide • AtlantaNow ➔ Discover Atlanta Now • Meeting and Event Planner ➔ Discover Atlanta Meetings and Events
• PR, media rollout
PRESIDENT’S REPORT William Pate President and CEO
OLD BUSINESS
2020 ELECTION OF EXECUTIVE COMMITTEE MEMBER t
Derrick Morrow Hyatt Regency Atlanta 2022
NEW BUSINESS
ADJOURN
DiscoverAtlanta.com