Diamondrock Hospitality Company · NASDAQ:DRH
Diamondrock Hospitality — Investor Presentation (March 2011)
17 slides from Diamondrock Hospitality's investor presentation, Mar 14, 2011
Slide 1: Investor Presentation March 2011
Investor PresentationMarch 2011
Slide 2: DiamondRock at a Glance
DiamondRock at a Glance 2 Excludes Frenchman's Reef and Morning Star Marriott Resort due to renovations.Excludes the Allerton Hotel senior debt and the NYC Times Square development.Market and brand concentrations based on forecasted 2011 hotel adjusted EBITDA. The charts do no reflect the Allerton H
Slide 3: DiamondRock Portfolio
DiamondRock Portfolio 3
Slide 4: Investment Highlights
Investment Highlights 4 AcquisitionsExecuted 4 opportunistic acquisitions in 2010 for $325M2011 NYC Times Square development - 250 to 400 roomsProven management team (completed 25 deals - many off market)Unique Marriott sourcing relationship (facilitated 8 transactions)Investment capacityLodging Fun
Slide 5: Acquisitions Transactions Market is Fully Functional
Acquisitions 5 Transactions Market is Fully Functional $13 billion in transactions are expected this year; 20% increase from 2010(1)Increased activity due to recovery in fundamentals, muted supply growth, and functioning financial marketsPublic REITs have cost of capital advantage Source: JLL Hotels
Slide 6: Acquisition Pipeline
Acquisition Pipeline 6 Increased Volume and Quality of Investment OpportunitiesTransaction volume expected to increase 20% in 2011(1)Motivated sellers from looming debt maturitiesSignificant Investment CapacityCurrent available cash balance over $200 millionUndrawn $200 million credit facility13 hot
Slide 7: Lodging Fundamentals
Lodging Fundamentals 7 Source: Green Street Advisors Industry in Early Stages of a Multi-Year Recovery in Lodging FundamentalsLodging cycles historically last 7 years; 2011 is only year 2Operators pushing rate more aggressively earlier in this cycleSupply constrained for years to come as constructio
Slide 8: Portfolio Growth
Portfolio Growth DRH Portfolio Poised for High GrowthDRH's portfolio produced most dynamic RevPAR and margin growth during the growth phase of the lodging cycleDRH led the peer set in both RevPAR and EBITDA Margin growth in 4 of the last 6 yearsThe portfolio entered the downturn well capitalized and
Slide 9: Frenchman's Reef Repositioning
Frenchman's Reef Repositioning 9 DiamondRock's Plan:$45 million projectProjected IRR > 20%Marriott contributionReinvent pool Destination spa Upgraded guestroomsSelf generation of energyIncreased energy efficiencyOverall enhancement of guest experience(CHART) Improved margins from operational and ene
Slide 10: Appendix
10 Appendix
Slide 11: 2011 Acquisition: NYC Times Square Development
Compelling Valuation: $445,000 per key Off-Market Transaction: Facilitated by management relationships to pre-empt full marketingIrreplaceable Location: Arguably the #1 development parcel in NYC for a new select service hotel (42nd Street & Broadway)Branding: Seeking approval from a top global hotel
Slide 12: 2011 Acquisition: NYC Times Square Development
Leisure Demand1) Times Square2) Bryant ParkBusiness Demand3) Times Square Tower - 1.2 million square feet4) 4 Times Square (Conde Nast Building) - 1.6 million square feet5) Bank of America Tower - 2.1 million square feet6) Verizon Building - 1.2 million square feet 2011 Acquisition: NYC Times Square
Slide 13: 2010 Acquisition Highlights
2010 Acquisition Highlights 137 Allerton Hotel ChicagoDistressed Debt, Off-Market Transaction: Acquired senior loan at $10M discountCompelling Valuation: Investment at only $140k/keyRepositioning Opportunity: Global brand repositioning opportunity Future: Foreclosure resolution expected in 2011Hilto
Slide 14: 2010 Acquisition Highlights
2010 Acquisition Highlights 147 Renaissance CharlestonStrong Yield: 8.4% yield on 2011 budgeted NOIOff-Market Acquisition: Sourced through Marriott relationshipStrong Growth Prospects: Major new demand generators (e.g., Boeing 787 Dreamliner assembly plant; introduction of service by Southwest Airli
Slide 15: Best In Class Capital Structure
Best In Class Capital Structure Durable Balance SheetNo corporate debtOnly non-recourse property mortgage debtNo debt maturities until late 2014Investment CapacityUndrawn $200 million credit facilityOver $200 million cash balance13 unencumbered hotels 15 Leverage Statistics(2):Net Debt / EV: 23% Net
Slide 16: Best in Class Capital Structure: Mitigates Risk
Best in Class Capital Structure: Mitigates Risk 16 Courtyard Midtown East (Oct. 2014)EBITDA: $8.3mm; Debt: $42.6mm at 8.81% Salt Lake City Marriott (Jan. 2015)EBITDA: $5.0mm; Debt: $31.7mm at 5.50% Los Angeles Airport Marriott (July 2015)EBITDA: $7.6mm; Debt: $82.6mm at 5.30% Worthington Renaissance
Slide 17: Safe Harbor
Safe Harbor Certain statements made during this presentation are forward- looking and are subject to risks and uncertainties. Many of these risks and uncertainties are discussed in the prospectus supplement and in the Company's filings with the Securities and Exchange Commission, all of which you sh
DiamondRock Hospitality — Investor Presentation (March 2011) on 6ix