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2010 IAHI Membership Survey

Executive Summary Results

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2010 IAHI Member Survey Executive Summary

Economic Environment:

Owners remain very concerned about the economy Though on road to recovery, many still struggling Over 40% not able to generate enough cash flow to service debt and make capital improvements on their hotels

Member Satisfaction with IAHI:

In the context of the extremely challenging economic environment, Owner overall level of satisfaction with IAHI has dropped since 2008 While primary strategic objective of IAHI is to help improve owner financial performance, only 41% of owners very

satisfied or satisfied with IAHI support in this area Owners would also like more support with people development and responsible business

Owner Support:

First and foremost, Owners want help improving their return on investment Specifically, Owners want support from IAHI/IHG in several key areas:

Driving occupancy Managing average room rates Finding, developing and retaining talented hotel employees

Other areas of desired support include utility and energy cost management and procurement support to get competitive pricing for bedding and linens, guest supplies and F&B

People Development:

Owners feel development of talented employees is extremely important (78% Very important, 18% Important) Owners, however, are only “satisfied” (Not very satisfied) with their ability to develop talent and deliver superior guest

experience Most Owners measure and manage employee engagement. Many who do not are not sure how

IAHI Involvement:

Owner willingness to be actively involved in the IAHI is high: 37% want to be more involved: 64% interested in serving on a Committee, 20% on the Board and 16% as Officer

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Distribution Of Members and Respondents By RegionDistribution Of Members and Respondents By RegionDistribution Of Members and Respondents By RegionDistribution Of Members and Respondents By Region

Members and Respondents By Region* –Respondents Representative of IAHI Membership

3038 Total Member Hotels

578 Total RespondentsAsia Pacific

Canada

Mexico

EMEA

United States

Latin America

Q7.1: “What is your region?” * Total open hotels: 4269; Total Member hotels: 3038; Total Respondent IHG Hotels: 704 (23% of all Member IHG Hotels)

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Distribution Of Respondents By IHG BrandDistribution Of Respondents By IHG BrandDistribution Of Respondents By IHG BrandDistribution Of Respondents By IHG Brand

Respondents By IHG Brand –All Brands, Especially Express, Well Represented

~1872 Total Members 578 Total Respondents

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IAHI members are still VERY concerned regarding current economic environment

Members are Still Struggling with Business Recovery and Generation of Cash Flow to Service Debt and Capital Improvements

Business Performance in Business Performance in Economic EnvironmentEconomic Environment

Business Performance in Business Performance in Economic EnvironmentEconomic Environment

Ability to Generate Cash for Debt Ability to Generate Cash for Debt Service & Capital ImprovementsService & Capital Improvements

Ability to Generate Cash for Debt Ability to Generate Cash for Debt Service & Capital ImprovementsService & Capital Improvements

Q2.1: “How is your business doing in the current economic environment?” Q2.2: “Do your hotels generate enough cash flow to support debt service and capital improvements?”

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Overall Satisfaction by LevelOverall Satisfaction by LevelOverall Satisfaction by LevelOverall Satisfaction by Level

In Tough Economic Environment, Overall IAHI Member Satisfaction Decreased From 2008 To 2010

Very Satisfied

Satisfied

Somewhat Satisfied

DissatisfiedNot Very Satisfied

N/A 1%

3%

• Owners have and continue to struggle in economic environment

• Primary strategic objective of IAHI is to improve owner return on investment

• Owners rate IAHI relatively low (41% very satisfied or satisfied) regarding support provided to improve owner financial performance (3.2)

• Less IAHI-Involved Owners and Struggling Owners Lowering Satisfaction Level

Potential Reasons for Decrease in Overall Satisfaction

Q3.1: “How satisfied are you with the overall performance of the IAHI?”Q3.2: “How satisfied are you with the support provided by the IAHI to help improve owner financial performance?”

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IAHI/IHG Joint Policy Wheel Scorecard: Owners Want More Support Improving Financial Performance

Strategic Priorities in collaboration with IHG

Help Improve Owner Financial Performance Support HR Issues and Help Develop Talented Employees

Support Environmentally Friendly &Sustainable Business Help you Deliver Excellent Service & Superior Guest Experience

41% 51%

56%49%

% Top 2 Box (Very Satisfied or Satisfied)

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The top member challenges today are generating cash flow to cover debt and capital improvement, Driving Occupancy, Managing Average Room Rates, Developing People and Reducing Costs

Top IAHI Member Challenges (% Very Important)Top IAHI Member Challenges (% Very Important)Top IAHI Member Challenges (% Very Important)Top IAHI Member Challenges (% Very Important)

Top Owner Challenges

Q4.1: “Please rate each of the following challenges you face today. Very important, Important, Somewhat Important, Not Important”

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Employee Delivery of Superior Employee Delivery of Superior Guest ExperiencesGuest Experiences

Employee Delivery of Superior Employee Delivery of Superior Guest ExperiencesGuest Experiences

IAHI Members Are Just Satisfied (Not Very Satisfied) With Employees’ Service Delivery And With Ability To Identify, Recruit And Develop Hotel Employees

Very Satisfied

Satisfied

Somewhat Satisfied

Not Very SatisfiedDissatisfied

Ability to Identify, Recruit and Ability to Identify, Recruit and Develop Hotel EmployeesDevelop Hotel Employees

Ability to Identify, Recruit and Ability to Identify, Recruit and Develop Hotel EmployeesDevelop Hotel Employees

Very Satisfied

Satisfied

Somewhat Satisfied

Not Very SatisfiedDissatisfied

Q5.2: “How satisfied are you with your employees’ delivery of superior guest experiences in your hotels?”

Q5.1: “How satisfied are you with your ability to identify, recruit and develop hotel employees?”

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Many Members (37%) Would Like To Increase Their Level Of IAHI Involvement. Of Those, 64% Would Like To Be On A Committee, 20% Be On the Board And 16% Be An Officer

Desired Level of IAHI InvolvementDesired Level of IAHI InvolvementDesired Level of IAHI InvolvementDesired Level of IAHI Involvement

Like Current Level

Ways Wish to Be More InvolvedWays Wish to Be More InvolvedWays Wish to Be More InvolvedWays Wish to Be More Involved

Get More Involved

Committee Involvement

Global Board

Officer

Be Less Involved

Q6.2: “How much would you like to be involved with the IAHI?” Q6.3: “In the future, what ways would you like to be involved with the IAHI (check all that apply)?

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Potential IAHI (and IHG) Implications – For Discussion

IAHI IAHI PerformancePerformance

People People DevelopmentDevelopment

Current Current Economic Economic EnvironmentEnvironment

Stay focused and continue working with IHG to develop and support strategies that improve Owner return on investment (ROI):

Increasing occupancy Managing average rates Developing people Reducing costs

Continue to increase active Owner involvement in IAHI leadership

Look for ways to provide relief to Owners during recovery period: Reduce existing costs Lighten existing standards and costs where possible Be careful about adding new requirement and costs

Work with IHG to improve ability to develop talented hotel employees who can deliver superior branded guest experiences

Support the development of Owner ability to measure and manage Employee Engagement

IAHI Owner IAHI Owner SupportSupport

Provide other support in key areas such as: Best practices related to Green Engage Procurement programs that drive better pricing in key cost areas Online travel agent process and distribution Guidance with RFP development