Diamondrock Hospitality Company · NASDAQ:DRH
Diamondrock Hospitality — Investor Presentation (January 2022)
22 slides from Diamondrock Hospitality's investor presentation, Jan 21, 2022
Slide 1: Investor Presentation January 21, 2022
11 INVESTOR PRESENTA T IO N JANUARY 21 , 2022
Slide 2: Forward Looking Statements
FORWARD LOOKING STATEMENTS Certain statements made during this presentation are forward- looking statements that are subject to risks and uncertainties. Forward-looking statements generally include the words “believe,” “expect,” “anticipate,” “plan,” “estimate,” “project,” “will,” “intend” or other
Slide 3: Key Takeaways and Recent Events
KEY TAKEAWAYS AND RECENT EVENTS RECENT TRANSACTIONS HENDERSON BEACH RESORT ■ Acquired the 170-room Henderson Beach Resort in Destin, Florida ■ 6.4% capitalization rate on 2021 Hotel NOI ■ 8.0% estimated stabilized Hotel NOI yield ■ Numerous asset management and ROI opportunities to drive incremental
Slide 4: Operating Update
OPERATING UPDATE (1) The comparable operating information includes operating results for our 32-hotel portfolio owned as of December 31, 2021, which includes our 2021 acquisitions (Bourbon Orleans, Henderson Park Inn and Henderson Beach Resorts) and excludes our 2021 dispositions. (2) Preliminary re
Slide 5: Why DiamondRock
WHY DIAMONDROCK 5
Slide 6: DiamondRock Is Positioned for Outsized Growth
DIAMONDROCK IS POSITIONED FOR OUTSIZED GROWTH 2022-2023 SETUP COMPELLING ROI PIPELINE STRONG/IMPROVING PORTFOLIO MARGIN IMPROVEMENT POTENTIAL POWERFUL CAPITAL RECYCLING 1 2 3 4 5 6 THE LODGE AT SONOMA
Slide 7: 2022-2023 Positioned for Outsized Growth
TRANQUILITY BAY RESORT ■ Sonoma Autograph Collection Q3 2021 ■ The Hythe, The Luxury Collection Q4 2021 ■ Margaritaville Beach House Q4 2021 ■ The Clio, The Luxury Collection Q1 2022 7 FOUR HOTEL UP-BRANDINGS 2022-2023 POSITIONED FOR OUTSIZED GROWTH IMPROVING GROUP TRENDS ■ Strong Expected Growth in
Slide 8: Projects Recently Completed or In Process
PROJECTS RECENTLY COMPLETED OR IN PROCESS PROJECT COST IRR Est Completion $3.6MM 74% Q1 2022 PROJECT COST IRR Completed $9.8MM 25% Jul 2021 PROJECT COST IRR Completed $8.4MM 88% Nov 2021 JW MARRIOTT CHERRY CREEKSONOMA RENAISSANCE VAIL MARRIOTT 8Estimated IRRs are calculated assuming a 3-year stabili
Slide 9: ROI Pipeline: $90MM of ROI Projects at 40%+ IRRs
ROI PIPELINE: $90MM of ROI Projects at 40%+ IRRs PROPERTY PROJECT ESTIMATED CAPITAL SPEND(1) ESTIMATED INCREMENTAL EBITDA(1) ESTIMATED IRR(2) ESTIMATED COMPLETION LODGE AT SONOMA Autograph Collection Conversion $9.8 $1.4 25% Complete VAIL MARRIOTT Luxury Collection Conversion $8.4 $3.4 88% Complete
Slide 10: Enhancing Portfolio Quality Through Risk Reduction
% SUBJECT TO GROUND LEASES COMPANY PERCENT OF ROOMS TENOR OF THE FIVE SHORTEST LEASES NO. OF LEASED HOTELS PEB 37% 35 Years 18 Hotels HST 29% 21 Years 20 Hotels PK 26% 18 Years 16 Hotels PEER AVERAGE 24% 44 Years 11 Hotels DRH-Prior 23% 51 Years 7 Hotels DRH-Current 21% 60 Years 6 Hotels SHO 18% 63
Slide 11: Up to 200bps of Potential Long Term Margin Improvement
UP TO 200BPS OF POTENTIAL LONG TERM MARGIN IMPROVEMENT Above the Hotel At the Hotel 50 – 150BPS: ■ Lower allocated costs from brands ■ Technology ■ Labor efficiency ■ Technology ■ F&B outlets ■ Housekeeping 50BPS UNIQUE TO DIAMONDROCK ■ Brand managed hotels converted to franchise 11 LONG TERM MARGIN
Slide 12: Powerful Capital Recycling
POWERFUL CAPITAL RECYCLING BENEFITS OF TRANSACTIONS ■ RECYCLING CREATES BORROWING BASE COLLATERAL: Recycling the disposition proceeds into unencumbered hotels provides significant enhancement to credit facility leverage metrics ■ INCREASED EXPOSURE TO RIGHT-TO-WORK STATES: Nearly 40% of portfolio ho
Slide 13: Tranquility Bay Beachfront Resort (Marathon, FL)
TRANQUILITY BAY BEACHFRONT RESORT (MARATHON, FL) KEY DEAL HIGHLIGHTS ■ 2021 TripAdvisor Traveler’s Choice Award and consistently among the top hotels in Marathon, FL. ■ 12 oceanfront acres with 1,000 feet of shoreline ■ Strict development ordinances constrain supply and supports the highest RevPAR o
Slide 14: Henderson Beach Resort (Destin, FL)
HENDERSON BEACH RESORT (DESTIN, FL) ACQUISITION DATE 12/23/21 PURCHASE PRICE $112.5 MILLION LOCATION DESTIN, FL NUMBER OF ROOMS 170 NUMBER OF RMAs: 46 EVENT SPACE 40,000 SQ FT KEY DEAL HIGHLIGHTS ■ AAA Four Diamond Award in 2019. Consistently recognized by Travel + Leisure, US News & World Report an
Slide 15: Portfolio
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Slide 16: DiamondRock at a Glance
DIAMONDROCK AT A GLANCE 9,452 ROOMS 33 PROPERTIES 23 GEOGRAPHIC MARKETS LOCATION EBITDA LOCATION EBITDA Boston, MA 15% Denver, CO 3% Chicago, IL 15% Phoenix, AZ 3% New York, NY 6% Burlington, VT 3% Washington, DC 6% Sonoma, CA 2% Ft. Lauderdale, FL 6% New Orleans, LA 2% Ft. Worth, TX 5% Charleston,
Slide 17: Portfolio: Data Table
PORTFOLIO: DATA TABLE KEYS REVPAR ($) TREVPAR ($) REVENUE/KEY ($000s) EBITDA/KEY ($000s) % OF 2019 EBITDA LUXURY RESORT 930 280 488 178 48 16% LIFESTYLE RESORT 1,216 190 307 112 33 14% LIFESTYLE URBAN 1,491 185 256 93 29 15% RESORT/LIFESTYLE 3,637 211 322 121 35 45% URBAN GATEWAY 5,815 178 240 88 27
Slide 18: Portfolio: Operator and Guest Mix Diversification
PORTFOLIO: OPERATOR AND GUEST MIX DIVERSIFICATION 18 2019 ACTUAL PRO FORMA FOR DISPOSITION AND ACQUISITIONS Corporate - Group, 21% Leisure - Group, 7% Leisure - Transient, 34% Corporate - Transient, 38% Corporate - Group 20% Leisure - Group 7% Leisure - Transient 37% Corporate - Transient 36% 41% LE
Slide 19: Strong Resort Market Presence
STRONG RESORT MARKET PRESENCE OVER 60% OF HOTELS LOCATED IN DESTINATION LEISURE MARKETS MARATHON, FL DESTIN, FL HENDERSON BEACH RESORT CAVALLO POINT TRANQUILITY BAY RESORT VAIL, CO DESTIN, FL THE HYTHE, A LUXURY COLLECTION HOTEL HENDERSON PARK INN FORT LAUDERDALE, FL WESTIN FORT LAUDERDALE BEACH RES
Slide 20: High Quality Portfolio in Key Gateway Markets
HIGH QUALITY PORTFOLIO IN KEY GATEWAY MARKETS NEARLY 40% OF HOTELS LOCATED IN TOP GATEWAY MARKETS ATLANTA, GA ATLANTA MARRIOTT ALPHARETTA BOSTON, MA SALT LAKE CITY, UTNEW YORK, NY FORT WORTH, TXDENVER, CO CHICAGO, IL CHICAGO MARRIOTT MAGNIFICIENT MILE WASHINGTON, DC WASHINGTON, DC SAN DIEGO, CA HILT
Slide 21: ESG Leadership
oss ESG LEADERSHIP
Slide 22: ISS ESG Rankings and GRESB Results
ISS ESG RANKINGS(2) ISS-ESG CORPORATE RANKING Currently Ranked in Top 1% of all US Real estate companies DiamondRock ranks in the top 5% of the Worldwide Real Estate Sector, earning an ISS ESG Prime designation 3ENVIRONMENTAL 4SOCIAL 1GOVERNANCE GRESB ANNUAL RESULTS 2017 2018 2019 2020 2021 DRH GRES
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