Thomas E. Callahan, CPA, CRE, FRICS, MAI Co-President & Chief Executive Officer -West April 18, 2012 Where Are We Headed?

San Francisco Lodging Market 2

Historical Occupancy and ADR of the San Francisco Lodging Market 3

2010 RevPAR Growth 50 Major Markets 4

2011 RevPAR Growth 50 Major Markets 5

San Francisco MSA Economic Assumptions 6 Payroll Employment Real Personal IncomeReal GDPCPI (Inflation) %-0.2%-3.7%0.7% %1.2%2.2%1.4% %3.5%1.4%2.6% 2012F 2.2%2.3%4.7%2.7% 2013F 1.6%2.3%2.1%2.9% L.R.A. 0.2%2.9%1.9%3.0%

San Francisco MSA All Hotels F2013F2014F Long-Run Average Occupancy75.0%71.2%75.1%78.9%79.7%79.9%80.2%71.9% % Change 0.1%-5.1%5.5%5.1%0.9%0.3%0.5%- ADR$156.41$133.52$136.21$155.07$171.17$181.61$ % Change 5.3%-14.6%2.0%13.8%10.4%6.1%5.5%3.1% RevPAR$117.25$95.02$102.28$122.42$136.38$145.08$ % Change 5.4%-19.0%7.6%19.7%11.4%6.4%6.0%3.7% Improved Occupancy = Better ADR Performance in 2012

San Francisco MSA Upper-Priced Hotels F2013F2014F Long-Run Average Occupancy76.3%73.3%77.7%80.6%80.8%80.6%80.7%73.0% % Change 0.3%-4.0%6.0%3.8%0.3%-0.3%0.1%- ADR$185.46$157.60$160.81$182.53$201.92$214.85$ % Change 4.1%-15.0%2.0%13.5%10.6%6.4%5.5%2.5% RevPAR$141.51$115.49$124.88$147.09$163.25$173.22$ % Change 4.4%-18.4%8.1%17.8%11.0%6.1%5.6%3.2% Improved Occupancy = Better ADR Performance in 2012

San Francisco MSA Lower-Priced Hotels F2013F2014F Long-Run Average Occupancy72.5%67.3%70.4%75.9%77.5%78.5%79.4%69.6% % Change -0.4%-7.2%4.6%7.8%2.1%1.3%1.2%- ADR$100.29$85.43$86.76$101.36$111.62$118.00$ % Change 6.2%-14.8%1.6%16.8%10.1%5.7%6.2%1.9% RevPAR$72.71$57.49$61.09$76.95$86.51$92.63$ % Change 5.8%-20.9%6.3%26.0%12.4%7.1%7.4%2.1% Improved Occupancy = Better ADR Performance in 2012

San Francisco Projected Performance 2012 Quarterly Performance 10 Q1 2012Q2 2012Q3 2012Q4 2012Annual Occupancy71.5%82.1%89.4%75.7%79.7% % Change1.9%1.1%0.2%0.7%0.9% ADR$161.70$166.98$177.01$177.71$ % Change12.7%12.4%8.9%8.3%10.4% RevPAR$115.65$137.07$158.16$134.55$ % Change14.9%13.6%9.1%9.0%11.4%

2011 RevPAR Growth 50 Major Markets 11

San Francisco Hotel Market ADR Growth at 3% per Year Based on Performance in

San Francisco Major Hotels: Projected Net Operating Income Dollars per Room and Ratio to Total Revenue 13

San Francisco Historical Performance Occupancy and RevPAR Correlation 14

2011 and 2012 Major San Francisco Transactions 15 Hotel PropertySale Date Sales Price Price per Room Cap. Rate Hotel Milano4/12$30.0 M$277,7781.5% Marriott SFO3/12$112.7 M$164,5266.0% Hotel Abri1/12$21.9 M$240,0003.8% Huntington Hotel11/11$52.5 M$303,571- Crescent Hotel11/11$14.0 M$168,6755.7% Villa Florence10/11$67.2 M$369,2315.0% Mandarin Oriental8/11$63.0 M$398,7343.5% Hotel Adagio7/11$42.3 M$247,0763.9% The Opal Hotel5/11$12.8 M$83,8827.8% Westin Market Street3/11$170.0 M$254,873- JW Marriott2/11$96.0 M$284,8662.0% Tuscan Inn2/11$52.3 M$236,4256.7% Argonaut Hotel2/11$84.0 M$333,3335.0%

Some Things To Think About 16

17 1.Personal incomes and corporate profit growth will continue, but at less robust levels. Lodging demand growth in 2012, while still positive, will pale relative to the past two years. Higher room rates will impede demand growth as well. 2.Unemployment will remain high – helps to keep labor costs in check and profit growth up. 3.Oil is a wild card for 2012 – too big an increase will undermine the economy – lodging demand will suffer as a result. 4.Overall, the second half of 2012 will be better than the first half as the future political leadership of the U.S. becomes clear.

Thank You 18