1. 2018 Operating & Capital Budget
December 21, 2017

2. Market Overview Market Performance Market Demand for 2018
1.8% RevPAR growth running 12 months for Portland by STR
Modest RevPAR growth of 1.1% projected for 2018 by CBRE
Market Demand for 2018
Group room nights as shown in the TAP report for the Portland market are down (- 2.6%) compared to prior year
Hilton’s 2018 group room night position is down -20.5% to the prior year position and ADR is up slightly +0.2%
New Supply/Renovations in 2017 & 2018:
Holiday Inn Express 192nd – 82 rooms opening March 2018.
Homewood Suites renovation, 30 rooms out of order Jan-May 2017
Sheraton Airport rooms and space 1st & 2nd Quarters 2017

3. 2018 Budget Process
Worked with Hilton to develop revenue and expense targets
RevPAR growth target 1.8% over 2017
Decline in Group position impacting F&B Banquet revenue
Budgeted expenses were based on flow targets with the exception of planned and unplanned expenses such as wage and benefit increases, renovation operating costs, etc.
Budgets have been reviewed and approved in detail by both Hilton’s regional team and CHMWarnick

4. Operating Trends 2018 Budget 2017 Forecast 2016 Actual Total Revenue
$18.52M
$18.07M
$16.99M
RevPAR
$120 - $130
$115 - $125
$110 -$120
Gross Operating Profit (GOP)
$5.83M
$5.37M
GOP Margin
31.5%
32.3%
31.6%
Net Operating Income
$4.93M
$4.98M
$4.56M

5. 2018 Capital F&B Banquet Equipment $72K F&B Kitchen Equipment $31K
2018 Budget
F&B Banquet Equipment
$72K
F&B Kitchen Equipment
$31K
Garage Gate and Elevator Landings
$54K
Information Technology
$94K
Contingency – Replacement Equipment
$24K
Total
$275K