CHICOS WELCOMES YOU!

Overview of Caribbean Lodging Market

Parris E. Jordan | Chairman of CHICOS

Kristina M. D’Amico | Senior Vice President – Director, Caribbean Region
1
November 10, 2022
Overview
This presentation will cover:

Hotel Trends,
Quick Facts on COVID-19
Performance & Observations,
the Region and Travel
Analysis by and Closing
Arrival Trends Restrictions
Island Thoughts
Quick Facts on the Region and Arrival Trends
Total Arrivals to Region, Last Decade
2023, 2024 targeted arrivals back to 2019 levels

32.0
Total Arrivals Millions

28.5 29.9 30.4 30.7

24.9 26.6
22.3 23.1 24.2
18.5
10.9

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Source: Caribbean Tourism Organization, HVS Research
Where Are They From?

19%
US
50% Canada
19% Europe
12% Other

Source: Caribbean Tourism Organization

Where Are They Going?

Dominican Republic 34% Trinidad & Tobago 2.0%

Jamaica 14%
Percent of Total Visitors

St. Maarten 1.7%

Bahamas 10% British Virgin Islands 1.6%
Puerto Rico 9% Antigua & Barbuda 1.6%
Aruba 6%
Bonaire 1.0%
Barbados 4%
Grenada 0.9%
USVI 3%
Cayman Islands 3% St. Kitts & Nevis 0.6%
Turks & Caicos 3% Anguilla 0.5%
Curacao 2% Dominica 0.5%
Saint Lucia 2% St. Vincent & the Grenadines 0.5%
Source: Caribbean Tourism Organization
Dominican Republic is the Most Visited Island in the Caribbean

6.2 6.6 6.4

5.3
Total Visitors Millions

5.0 4.9

3.3
2.4
1.7

2017 2018 2019 2020 2021 YTD Sep '19 YTD Sep '20 YTD Sep '21 YTD Sep '22

Source: Central Bank of the DR

The Caribbean Region is Most dependent on Tourism

Top Caribbean Destinations by tourists:

✓ 32 island nations
✓ 45 million residents
✓ Travel & Tourism sector
Dominican Jamaica Bahamas Puerto Rico contributed $39.1 billion to
Republic GDP in 2021

Source: WTTC
Caribbean Travel & Tourism Sector Recovery
Expected to have GDP back to pre-pandemic levels by end of 2024, early 2025

2021 GDP : Second- 2021 Travel & Tourism Forecast: Travel & Tourism Travel & Tourism jobs are
fastest recovery of all contribution to GDP : contribution to GDP forecast to  at 3.3%
regions estimated at  5.5%
36.6%, still  36.1% annually, outpacing the
Job Gain : 15.2% below 2019 global economy
estimation of  2.4%

Source: WTTC
COVID-19 Travel Restrictions
COVID-19 Restrictions Removal

Majority of Various structures Nations provided

countries closed Restrictions COVID test was
of island different policies &
between 2-7 governments restrictions for changed monthly required to enter
months, while contributed to mix travel U.S.
some 15+ months messaging to
visitors

Source: HVS Research

Least to Most Travel Restrictions, 2021

Dominican Republic

Bahamas Jamaica Aruba Puerto Rico U.S.V.I & BVI

St. Maarten/
Barbados Saint Lucia Dominica Curaçao
Martin
Most to Least

Antigua & Anguilla & St. Kitts &

Barbuda Turks & Caicos Bonaire Grenada
Nevis
St. Vincent & Trinidad &
St. Barthélemy Cayman Islands Haiti
the Grenadines Tobago
Source: HVS
Least to Most Travel Restrictions, 2022

Dominican Republic

Bahamas Jamaica Aruba Puerto Rico U.S.V.I & BVI

Barbados Saint Lucia St. Barthélemy Dominica Curaçao

Most to Least

Antigua & Cayman Anguilla & St. Kitts &

Barbuda Bonaire Grenada
Islands Nevis
St. Vincent & St. Maarten/ Trinidad &
Haiti Turks & Caicos
the Grenadines Martin Tobago
Source: HVS
Percentage of Islands Nations with Vaccine Mandate
USVI and Puerto Rico require non-U.S. Citizens to be fully vaccinated per entry requirements to U.S.
October 2021 October 2022

4%
35%
Mandatory Mandatory
Most to Least

Not Mandatory Not Mandatory

65%
96%

Source: HVS Research, Data as of October 27, 2022

Hotel Performance & Analysis by Island
United States, YTD September 2021 vs. 2022

 34.9% ✓ Supply:  2.6%

RevPAR
$95 ✓ Demand:  14.0%
✓ Occupancy:  15.0%
$70
✓ ADR:  7.5%
Most to Least

✓ Revenue:  20.5%
✓ Exceeded YTD ‘19 RevPAR  6.8%
YTD '21 YTD '22 ✓ Rebound of Foreign Travel

Source: STR, sample of approximately 5.6 million rooms

Caribbean 2019 Peak Year!
Peak arrivals at 32,000,000 million (highest in 20-year period)

ADR RevPAR Occupancy

$245
Zika 70%

$195
Irma Maria 65%
Most to Least

$145 60%
9.11
Great Recession
$95 55%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Source: STR
Caribbean Last Five Years and YTD September Comparisons
ADR RevPAR Occupancy
$315
65%
$265
55%
$215
45%
$165
Most to Least

$115 35%

$65 25%
2017 2018 2019 2020 2021 YTD Sept YTD Sept YTD Sept YTD Sept
'19 '20 '21 '22

Source: STR
Caribbean, YTD September 2021 vs. 2022

13.1 ✓ Supply:  3.2%

$210
 79.2%  80.9% ✓ Demand:  47.9%

Visitors Millions
✓ Occupancy:  43.1%
RevPAR

$117 7.2 ✓ ADR:  25.2%

✓ Revenue  85.2%
Most to Least

✓ Exceeded YTD ‘19 RevPAR  17.0%

✓ Significant monthly occupancy 
✓ Removal of nearly all restrictions had a
YTD '21 YTD '22 YTD '21 YTD '22 noteworthy impact on the region

Source: STR, sample of approximately 201,000 rooms; HVS Research

Dominican Republic Historical Performance
Number of Rooms Occupancy
90,000
75%
80,000
65%
70,000
55%
Most to Least

60,000 45%
50,000 35%

Source: Dominican Republic Central Bank, ASONAHORES, Ministerio de Turismo

Dominican Republic, YTD September 2021 vs. 2022

$105 5.3 ✓ Supply:  2.3%

 88.4%  66.9% ✓ Demand:  62.8%

Visitors Millions
3.3 ✓ Occupancy:  59.0%
RevPAR

$55 ✓ ADR:  18.5%

✓ Revenue  92.9%
Most to Least

✓ Exceeded YTD ‘19 RevPAR  5.3%

✓ Demand increase driven by resurgence
of Canadian traveler (second biggest
YTD '21 YTD '22 YTD '21 YTD '22 market)
Source: STR, sample of approximately 80,000 rooms; Central Bank of the DR
Aruba, YTD September 2021 vs. 2022
✓ Supply:  0.9%
$243 0.8 ✓ Demand:  32.0%
 65.2%  44.0%
✓ Occupancy:  30.8%

Visitors Millions
0.6 ✓
RevPAR

$147 ADR:  26.3%

✓ Revenue  66.8%
✓
Most to Least

Pacing below YTD ‘19 RevPAR  7.4%

✓ No new supply until 2023 with opening of
330-room Embassy Suites
✓ U.S. tourist continues to dominate travel
YTD '21 YTD '22 YTD '21 YTD '22 (80%+ of total)
Source: STR, sample of approximately 7,200 rooms, AHTA
Bahamas, YTD September 2021 vs. 2022

0.9 ✓ Supply:  1.9%

$264
 129.3%  81.6% ✓ Demand:  78.3%
✓ Occupancy:  75.1%

Visitors Millions
RevPAR

0.5 ✓ ADR:  30.9%

$115 ✓ Revenue  133.5%
Most to Least

✓ Exceeded YTD ‘19 RevPAR 

42.3%
✓ Visitation still below YTD ’19 
YTD '21 YTD '22 YTD '21 YTD '22 22.8%

Source: STR, sample of approximately 14,000 rooms, Bahamas Ministry of Tourism

Barbados, YTD September 2021 vs. 2022

$176 303.4 ✓ Supply:  12.8%

Visitors Thousands
 200.0% ✓ Demand:  104.3%
 379.9%
✓ Occupancy:  90.5%
RevPAR

✓ ADR:  57.5%
$59 ✓ Revenue  237.4%
Most to Least

63.2
✓ Pacing below YTD ‘19 RevPAR  10.9%
✓ 40%+ of demand historically from Europe
✓ Visitation when compared to YTD ‘19 
YTD '21 YTD '22 YTD '21 YTD '22 41.8%

Source: STR, sample of approximately 6,100 rooms, Central Bank of Barbados

Cayman Islands, YTD September 2021 vs. 2022
$185 ✓ Supply:  25.5%
✓ Demand:  151.0%

Visitors Thousands
 325.3% 146.6
✓ Occupancy:  100.5%
 2,679.4% ✓
RevPAR

ADR:  112.1%
✓ Revenue  432.4%
$43 ✓
Most to Least

Pacing below YTD ‘19 RevPAR  44.8%

✓ Border did not reopen until January 2022
5.3
(vaccinated only)
✓ Visitation when compared to YTD ‘19 
YTD '21 YTD '22 YTD '21 YTD '22 55.9%
Source: STR, sample of approximately 3,700 rooms, Cayman Islands Tourist Board
Curaçao, YTD September 2021 vs. 2022

0.4 ✓ Supply:  17.2%

✓ Demand:  89.5%

Visitors Millions
 113.8% $144
 136.7%
✓ Occupancy:  61.6%
RevPAR

✓ ADR:  32.3%
0.2
$67 ✓ Revenue  155.4%
Most to Least

✓ Pacing above YTD ‘19 RevPAR  22.0%

✓ Netherlands continues to be primary
source market (50% of total) and YTD
YTD '21 YTD '22 YTD '21 YTD '22 ‘22 visitation  2.7% over YTD ‘19
Source: STR, sample of approximately 4,800 rooms, Curaçao Tourist Board
Jamaica, YTD September 2021 vs. 2022

$177 ✓ Supply:  2.0%

✓ Demand:  17.2%

Visitors Millions
 100.2% 1.4
 99.7% ✓ Occupancy:  67.6%
RevPAR

$89 ✓ ADR:  19.4%

0.7 ✓ Revenue  101.2%
Most to Least

✓ Pacing equal to YTD ‘19 RevPAR

✓ Visitation when compared to YTD ‘19
 13.9%
YTD '21 YTD '22 YTD '21 YTD '22 ✓ Almost there!
Source: STR, sample of approximately 26,200 rooms, Jamaica Tourism Board
Puerto Rico, YTD September 2021 vs. 2022

7.0 ✓ Supply:  2.8%

✓ Demand:  12.6%

Visitors Millions
 22.6% $191
 3.4%
$155 ✓ Occupancy:  9.6%
RevPAR

6.8 ✓ ADR:  11.9%

✓ Revenue  26.2%
Most to Least

✓ Pacing well above YTD ‘19 RevPAR

 34.8%
✓ Visitation when compared to YTD ‘19
YTD '21 YTD '22 YTD '21 YTD '22  11.5%
Source: STR, sample of approximately 15,000 rooms, Puerto Rico Tourism Company
Trinidad & Tobago, YTD September 2021 vs. 2022

$63 ✓ Supply:  4.1%

155.4

Visitors Thousands
 65.4% ✓ Demand:  16.9%
 1,121.8%
$38 ✓ Occupancy:  12.5%
RevPAR

✓ ADR:  47.1%
✓ Revenue  72.0%
Most to Least

12.7
✓ Pacing below YTD ‘19 RevPAR 
39.8%
✓ One of the last islands to open borders
YTD '21 YTD '22 YTD '21 YTD '22

Source: STR, sample of approximately 4,200 rooms, Government of Trinidad and Tobago - Central Statistical Office
Summary Visitation
Percentage Change Between September YTD 2019 vs. 2022
40.0% 31.6%
20.0% 8.1% 11.5%
2.7%
0.0%
-3.8%
-20.0% -13.9%
-16.7% -18.8%
-22.8%
Most to Least

-40.0%
-41.8% -47.0%
-60.0%
-55.9%
-80.0%
Caribbean Aruba Bahamas Barbados Cayman Curaçao Dominican Jamaica Puerto Saint Trinidad USVI
Islands Republic Rico Lucia

Source: HVS Research

Summary RevPAR
Percentage Change Between September YTD 2019 vs. 2022
60.0%
42.3%
40.0% 34.8%
17.0% 22.0%
20.0%
5.3%
0.0%
0.0%
Most to Least

-20.0% -7.4% -10.9%

-40.0%
-44.8% -39.8%
-60.0%
Caribbean Aruba Bahamas Barbados Cayman Curaçao Dominican Jamaica Puerto Rico Trinidad
Islands Republic
Source: STR, HVS Research
Resiliency!

Most Travel ADR Visitation Group Travel Cost Cruising

Islands
Most to Least Restrictions Business & Schedule

ADR RevPAR Pacing Main  YTD ‘19 Lagged Leisure Impacting Cruise
 Above 2019 Driver for in Many Travel in Q1 & Demand in Passengers are
RevPAR Islands Q2. Reversal Some Islands still  50%
Beginning! from 2019
Trends, Observations, and Closing Thoughts
Trends & Observations

Ease of Robust Investor Volatility Availability of

Travel Growth Interest Capital Markets Debt
Trends & Observations (continuation)

Interest in No Discount Expansion of Hotel Sales Rebranding,

Residential for Buyers All-Inclusive Activity Renovations
Trends & Observations (continuation)

Branded Challenges Outlook

Properties Remain Favorable
Financing Challenges
Main Concerns Deal Terms Vary by Risk Lending
Sponsor Country More Components/ International Investor
Greater Product Mix Seeking Discount
Airlift Sponsor
Branding Product Higher Lender Interested in
Interest Rate Strong Projects
New Supply Macro Economic
Management Environment
Labor
Business Plan Source: HVS
General Financing Terms
LTVs & LTCs
• Typically, 50-60%
• Mixed-use with residential sales component has
gained more acceptance
• True cash equity vs. implied equity
• Large package syndications available in certain
instances
• Strong Sponsorship with track record critical
• Sponsors should weigh the macroeconomic
environment carefully and exercise patience with
availability for draw schedules on new builds
Source: HVS
Interest Rates
(Existing)
• Floating Rates
• Acquisitions/ Refinancing of Existing Assets – SOFR
(Secured Overnight Funds Rate) + 400bp to 500bp
• Depending on variables such as location, asset, brand,
sponsor
• Sliding amortization schedules can allow for ramp phase
in a rebranding case study
• Non-Bank appetite for investment as increased in this
area but took a slight step back over a volatile summer
General Financing Terms
Interest Rates
Hi-Yield Lenders
(New Build)*
• New Construction on some Islands (e.g., Turks and • Recapitalizations, Repositioning, in some Cases New
Caicos, DR, Bahamas, Jamaica, Costa Rica) Construction
• Floating Rates • Rates SOFR + 900-1000 bp (Landing in 12-15%
• Acquisitions/ Refinancing of Existing Assets – SOFR effective rate)
(Secured Overnight Funds Rate) + 450bp to 550bp • 2–3-year term with extension options
(and higher) • Proposal of equity kickers not uncommon (single digit
• Variables: location, development program, asset, %)
brand • Requirement of senior protections as an alternative
• Heavily dependent on sponsor to traditional lending not uncommon, should be
• Blended rates with local currency & $USD based on weighed carefully.
project uses to bring cost of debt capital down
Source: HVS; * All-Inclusive sector based on legacy relationships and predictability of inflows can achieve lower cost of capital globally
Notable Openings & Rebranding 2022

The BRIX, an Rok Hotel Kingston, a

Autograph Collection Tapestry Collection Hotel

Sanctuary Cap Cana

Notable Openings & Rebranding 2022

Sandals Royal Curaçao

Westin Beach Resort & Spa

and Autograph Collection
Notable Transactions 2022

Ritz-Carlton Reserve Four Seasons Wyndham

Courtyard Nassau Embassy Suites
Dorado Beach Anguilla Grand Rio Mar
Location Puerto Rico Anguilla Bahamas Puerto Rico Puerto Rico
Rooms 96 + 14 Residential Units 181 201 400 313
Buyer Braemar Dart London + Regional LionGrove Highgate
Affiliate of Starwood Stabilis Capital
Seller Prisa Group Wyndham Blackstone
Capital Group Management
Approx. Price $187 million Undisclosed $25 million Undisclosed $65 million

Source: HVS Research

Closing Thoughts

Resiliency Challenges

Hotel Forecast
Performance
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to take full advantage of the industry’s ongoing recovery in 2022. Let Management
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Pre-Opening Oversight

Parris E. Jordan
Scan Me to Management Agreement Analysis &
Negotiation
Hotel Management

pjordan@hvs.com | +1 (917) 902-2314 Download Appraisal for Refinancing

Operation Performance Analysis

Kristina D’Amico
Presentation Repositioning Study & Valuation
Repositioning Design & Budgeting
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kdamico@hvs.com| +1 (305) 338-0354

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