Transcript Slide 1

37th Annual Arkansas Governor’s Conference on Tourism
Partners Luncheon
March 7, 2011
“Making the Most of What you Have”
“Making The Most of What You Have”
R. Byron Carlock
President and CEO
CNL Lifestyle Company LLC
CNL Lifestyle Properties, Inc.
Launched in April 2004 as CNL Income Properties
Non-traded real estate investment trust (REIT)
Preeminent landlord of experiential real estate
$2.7 Billion in Total Assets
Portfolio of 151 ski, golf, attractions, marinas, senior living & additional properties
.
Our Portfolio of Lifestyle Properties
33 Operators/Managers
32+2 Geographies
10 Sectors
Accessible Drive-To Locations
Ideal for “staycations”
97% of properties are
= within a 3 hour drive to
major metro areas
Property Sector Timeline
Ski & Mountain
Lifestyle
38 years / 6 down cycles
‘72
29 years / 4 down cycles
‘81
‘82
‘62
Golf
Attractions
28 years / 4 down cycles
Marinas
48 years / 7 down cycles
Additional Lifestyle
Properties
31 years / 5 down cycles
‘79
34 years / 5 down cycles
‘79
ALL
Economic Cycles
’70 Vietnam War
‘82 Savings
and Loan Crisis
‘01 Accounting
Scandals & 9/11
‘80 High Inflation
‘61 Berlin Crisis
& Bay of Pigs
‘75 Nixon Resignation
& Oil Embargo
‘91 Persian Gulf War
‘08 Sub-Prime Crisis
Vacation Time Around the World
Average vacation days per year
Italy
42
France
37
Germany
35
Brazil
34
United Kingdom
Canada
United States
28
26
Korea
25
Japan
25
13
A Realignment of Priorities
Realignment of Priorities + Time =
Increase of leisure and lifestyle activities
Pursuit of passions
Marketplace Demographics
2010 percentage of population by age group
PERCENT OF U.S. POPULATION
An Incoming Wave of 203 Million
RETIREMENT BEGINS
ECHO
BOOMERS
GEN
XERS
BABY
BOOMERS
77
MILLION
50
MILLION
77
MILLION
AGE
Demographics & Psychographics
The Demand “Drivers”
BABY BOOMERS
46
GEN XERS
64
By 2015, will hold:1
• 83% of nations net worth
• 53% of disposable income
• 54% of consumer spending
• Average household income
of $94,400
ECHO BOOMERS
77
• Entering peak earning and
spending years2
• Head 46% of households
with children2
• Account for 22% of
workforce3
• More than 22% earn
$100,000 or more annually2
• Account for 36% of the
workforce3
• Spending $400 billion/year4
• By 2015, will spend $2.4
trillion/year4
97
What Americans Are Thinking
”Encountering Anguish & Anxiety Across
America” TIME magazine October 7, 2010
Topic A
Best days are behind us
Kids won’t live as well
China in driver’s seat
Politics
Democrats: don’t know what they stand for
Republicans: know exactly what they stand for
Washington is broken
Most Passionate on:
Financial community and effect on economy
Constant state of war
Every 1 mention of Afghanistan there’s 25 for China
Economy trumped terrorism
What Americans Are Doing
Recent Wharton Psychology Study
Time matters more than money even
when you live below the poverty line
“New Normals”
Staycations over vacations
Cutting back on small things
What Mass Affluent Americans Are Doing
LA Times: Super rich are opening
wallets wider at theme parks
Reuters: Winnebago quarterly profit
tops Wall Street view –Class A category
"New Normal”
CNBC: Luxury sector rebounding as
wealthy replenish their wardrobes
USA Today: Nation’s wealthiest 5%
account for 37% of consumer spending;
its OK to splurge
WSJ: Safe to look rich again; new luxury
is deeply appropriate
Experiences Over Products
EXPERIENTIAL PURCHASES
In Recession, Americans Doing
More, Buying Less
01/03/10 New York Times
Study: Experiences Make Us
Happier Than Possessions
02/10/09 CNNHealth.com
Experiences Bring More Joy Than
Possessions Do
02/09/09 US News & World Report
&
FRUGAL FATIGUE
Fighting Frugal Fatigue
11/19/2009 The Boston Globe
Frugality Falling Out Of
Fashion?
10/19/2009 The Washington Post
Frugal Fatigue? Some Are
Splurging A Little
05/06/2009 The Associated Press
What’s The “Perfect” Getaway?
Family often encompasses three generations
Parental guilt: both working in 60% of households
Kids in the driver’s seat
Grandparents pick up the tab
Looking for kid enrichment
Looking for adult relaxation
Moods and Trends in Leisure & Lifestyle
Start with value proposition then capture luxury
dollars upon arrival with up-sell opportunities
Social media is driving traffic: SMERF (Social,
Military, Educational, Religious and Fraternal
groups)
Fear is entering consumer decisions: flying, going
abroad, economic/political environment,
security/body scanners
Authenticity is the answer: “Consumers want a way
out of their bad mood; only cure is authenticity”
10 Attributes of Authenticity of the Connected Generation’s
Consumer Cravings
USAToday: Women, young adults are active ‘social animals’
“Attributes of Authenticity”:
1. Shine the spotlight: Extreme personalization, marketing has a new face
2. Raise my pulse: Adventure is the new social currency
3. Make loose connections: Redefine the meaning of family
4. Give me brand candy: Everyday objects get sharp intuitive design
5. Sift through the clutter: Editors and filters gain new prominence
6. Keep it underground: Rejection of push ads; rise of peer-to-peer networks
7. Build it together: Connected; exploring creativity & influencing change
8. Bring it to life: Orchestrating everyday activities--a sense of theater
9. Go inward: Spiritual hunger, modern media find common ground
10. Give back: Redefining volunteerism & community contributions
5 Essential Criteria Underlying All Cravings
Experience: Consumers want to get out there and test personal limits.
They want to feel alive and shake up a stale routine
Transparency: Connected generation knows how to get full disclosure.
The push model of marketing will no longer work
Reinvention: X and Y generations demand what’s new, better, faster and
more efficient. If it doesn’t work they will find what does
Connection: The new market runs on cooperation. The hottest sites on
the Internet like Facebook, eBay and Craigslist connect people
Expression: People are searching for new ways to define and express
themselves
Retail Market Examples
Whole Foods
Focus on specialty food with a story and locally grown
produce; defied the recession with authenticity
TOMS shoes
Socially conscientious retailer
Toms of Maine
All natural and branding around their state
Las Vegas
From family focus in 90s, back to adult focus
CNL Lifestyle Properties Case Study
The Omni Mount Washington Resort
Historic, Iconic, Irreplaceable
Luxury hotel
Fine dining/Affordable dining
Golf/Fishing/Hiking/Camping
Skiing/Zip-Lining
Regional/State Authentic:
Food/Wellness/Hospitality
The Southern BBQ Trail
California Mud Baths
Haycation
Hot Springs Bath House Row
Regional/State Authentic:
Music/Arts & Crafts/Literature
Chicago Blues Festival
King Biscuit Blues Festival
Spoleto Festival
The Literary Trail of Greater Boston
Midnight in Garden of Good and Evil
Grisham Trail
Dollywood
Silver Dollar City
Regional/State Authentic: History/Geography
The Appalachian Trail
Maine Huts & Trails
Regional/State Authentic: Sports/Adventure
Robert Trent Jones Alabama
Golf Trail
Sugarloaf Sugar Shack
Texas River Tubing
Q&A