Value Place. Extended Stay Hotel. Warmbrodt Hotel Investments warmbrodthotels.com. Nellis Air Force Base Las Vegas, Nevada

Transcription

1 Value Place Extended Stay Hotel Nellis Air Force Base Las Vegas, Nevada Warmbrodt Hotel Investments warmbrodthotels.com

2 Investment Highlights The Value Place represents an excellent acquisition opportunity for a local, regional or national owner looking to acquire an extremely well located property within one block of the main entrance to Nellis Air Force Base. Value Place is the uniquely branded premier low-cost extended stay hotel, specializing in clean and secure weekly lodging with a commitment to comfort, privacy and peace of mind. The property is offered at $16,500,000, only $68,182 per suite. This property is currently under construction and is scheduled to be completed in September Nellis Airforce Base employs over 13,000 military and civilian personnel in addition to 1,340 temporary duty personnel, creating tremendous demand for the Value Place property. Estimated number of indirect jobs created by Nellis in direct support of the base was 5,698. Delivered free and clear of management Opportunity to become part of a growing new and successful national franchise Excellent location in relation to major demand generator New construction and design allows efficient operation and no immediate capital upgrades Concrete foundation with wood frame construction and stucco Financing available to qualified purchaser The Value Place represents an excellent investment opportunity for an owner/ operator to purchase a new asset with an outstanding opportunity for a steady revenue stream, strong net operating income and excellent returns on equity. Weekly rates are anticipated to be between $ and $ Occupancy is projected to achieve 85%. Warmbrodt Hotel Investments Value Pl ace Extended Stay Hotel Nellis Air Force Base L as Vegas, Nevada 2

3 Property Overview Asset Property: Value Place Address: Craig Road, West of Las Vegas Boulevard Las Vegas, Nevada Location: Located within one block of Las Vegas Boulevard and main entrance to Nellis Air Force Base Offering Listing Price: $16,500,000 only $67,623 per room Ownership Interest: Fee simple Description Number of Suites: 242 suites Corridors/Floors: Two, Four-story, interior corridor buildings containing 86,860 square feet Year Built: Under Construction; Completion Scheduled September 2010 Site Area: Gross 7.73 acres or 336,719 square feet; Net 6.73 acres; 293,159 square feet Foundation: Reinforced concrete slab Structure: Wood & steel with soundproof flooring Roof: Pitched roof with synthetic clay tile Exterior Walls/Windows: Stucco over soundboard, thermopane in anodized aluminum frames Fire Protection: Suites and public spaces have hard wire smoke detector connected to fire panel and are fully sprinklered Laundry On Site Elevators: Each building contains one hydraulic elevator Guestroom Amenities: All suites offer high speed internet access, kitchens, cable television, through-the-wall individual PTAC units Parking: 252 total parking spaces Franchise: Subject to approval by Value Place Corporation HVAC: All Suites have through the wall PTAC units Public spaces have centralized units Warmbrodt Hotel Investments Value Pl ace Extended Stay Hotel Nellis Air Force Base L as Vegas, Nevada 3

4 Guest Suites Guest Suite Configuration 242 Total Guest Suites 84 Studios All Suites will include the following amenities: Dresser and nightstand Color TV with cable and at least one free movie channel Dining table with two chairs Full-size refrigerator with freezer Sofa (Studio Sleeper only) Coffee table (Studio Sleeper only) Microwave oven Two-burner stove Housekeeping, every two weeks Vending machines Onsite laundry facilities Private secured entrance Optional: Utensils, dishes and cookware Additional housekeeping Linen service High-speed Internet Coffee Maker 24 Studios Double 120 Sleeper Double 14 Sleeper HCA Universal The property will offer 242 Guest Suites: The Studio: one double bed The Studio Sleeper: one double bed and one sleeper sofa The Studio Double: 2 doubles Warmbrodt Hotel Investments Value Pl ace Extended Stay Hotel Nellis Air Force Base L as Vegas, Nevada 4

5 Projected Occupancy and ADR The Value Place is expected to effectively compete in the Nellis Airforce Base market and achieve occupancies and ADR s commensurate with its location, branding, and facilities, relative to the competition. The property is anticipated to achieve an ADR of $32.71 or a weekly rate of $229 and will stabilize at 85% occupancy. The income summary below illustrates the hotel s projected operating performance. S stabilized Projections Year 1 F factors Amount Ratio Income Rooms $2,455, % Telecommunications $3, % Other $62, % Total Revenue $2,521, % Department Expenses Rooms $238, % Telecommunications $7, % Other $31, % Total Department Expenses $278, % Gross Operating Income $2,243, % Undistributed Operating Expenses Energy $113, % Franchise Fees (Including Marketing) $126, % Property Operations & Maintenance $113, % Administrative & General $226, % Total Undistributed Operating Expenses $579, % Management Fees $75, % Gross Operating Profit $1,588, % Fixed Charges Real Estates Taxes & Licenses $75, % Insurance $40, % Reserves for Replacements $88, % Total Fixed Charges $204, % Net Operating Income $1,383, % Operating Statistics $229 per week Occupancy 85.00% Average Daily $32.71 RevPAR $27.80 Number of Rooms 242 Days In Period 365 Available Rooms 88,330 Occupied Rooms 75,081 Warmbrodt Hotel Investments Value Pl ace Extended Stay Hotel Nellis Air Force Base L as Vegas, Nevada 5

6 Location and Property Overview The Property is located on Craig Road, within one block of the main entrance to Nellis Air Force Base in Las Vegas, Nevada. The location has excellent visibility and access on Craig Road and is proximate to commercial business which provides services to the typical Value Place guest. The Property is a typical prototype Value Place. The 242- room, four-story, interior-corridor property, consisting of two buildings, is currently under construction with a completion date expected September The total square footage of both buildings is 86,860. In addition to the guest suites, the first building contains a guest lobby and office area, storage rooms, an electrical room, a boiler room, a vending room adjacent to the lobby and one elevator. The lobby area is typical of the Value Place design containing a vestibule entrance, lobby/ registration desk area and manager s office and employee restroom behind the registration desk. The vending area is adjacent to the lobby with its own outside entrance. The second building does not contain an office or lobby. The Property is situated on a rectangular site consisting of 7.73 acres. The buildings were constructed with concrete foundations, wood and metal framing. The exteriors are finished with stucco over soundboard, thermopane anodized aluminum frames. Roofs are pitched and covered with synthetic clay tiles. Guest suites have individual through-the-wall PTAC units. There is ample parking for hotel guests. The location is considered excellent within the Las Vegas Market due to the proximate location near Nellis Air Force Base. MARKET AREA OVERVIEW The Value Place is located on the north side of Craig Road, just west of Las Vegas Boulevard. Market area boundaries are described as follows: North: Interstate -15 South: Lake Mead Boulevard East: Speedway Boulevard West: Pecos Road The property is located in the northeastern quadrant of the Las Vegas metropolitan area. In relation to the major shopping and business districts, this market is approximately seven miles northeast of the downtown gaming and business district and approximately 10 miles northeast of the world famous Las Vegas Strip. Nellis Air Force Base, the Tactical Air Command headquarters and major training bases for the armed services, fills a majority of the northeast quadrant of this market area. McCarran International Airport located in Las Vegas, Nevada is one of the most modern and fastest growing airports in the country. It is the nation s fifth-busiest passenger airport and is conveniently located just 10 miles South of the Value Place. Aviation National 2007 recorded an estimated $17.8 Million of economic benefit to the Las Vegas metropolitan area. The Nellis Federal Hospital is a Nellis Hospital project that opened in 1992 to provide full veteran s hospital services. The 374,000 square foot facility has 129 total beds that are reserved for Air Force and VA personnel. There are 36 dental treatment rooms, 11 clinics and a War Readiness materials warehouse and a central energy plant. Additional proposed projects for the area include a 20 acre veteran s convalescent home located next to the Nellis Federal Hospital. Warmbrodt Hotel Investments Value Pl ace Extended Stay Hotel Nellis Air Force Base L as Vegas, Nevada 6

7 Nellis Air Force Base Nellis Air Force Base is the largest and most complex installation in the Air Force s Tactical Air Command. It is also the busiest air base in the world. The base covers approximately 12,000 square miles of airspace, while the total area of the base including restricted ranges is approximately 3,000,000 acres. Nellis AFB is one of the largest employers in Southern Nevada with 9,200 military and 3,700 civilian personnel. In addition, there is an average of 1,340 temporary duty personnel per month at the base. Nellis Air Force Base and Creech Air Force Base have played important roles in southern Nevada since the early 1940 s. The primary mission of Nellis AFD is the training of military personnel to fly, flight and win utilizing the 2.9 million-acre Nevada Testing and Training Range. Nellis is the leader in combat aircrew training in the United States Air Force. Creech AFB has become pivotal in the War on Terror, operating via satellite link the Predator and Reaper Uninhabited Aerial Systems flown over Iraq and Afghanistan. Supporting these missions, the installations are home to the largest civil engineer, communications, logistics readiness, and force support squadrons in Air Combat Command, as well as the largest security forces group in the command. In fiscal year 2008, Nellis, AFB had operations and maintenance outlays of more than $437 million while Creech AFB expended more than $25 million. There were approximately 9,227 military and 3,748 civilians employed between the two bases with a combined payroll of over $921.8 million. On any given day, approximately 1,340 temporary duty personnel conduct business at Nellis or Creech. The number of indirect jobs created in direct support of Nellis and Creech is estimated to be 5,698 with an estimated annual dollar value of $218.4 million. During the same fiscal year 2008, the Las Vegas metropolitan area reported a total of 27,615 military retirees among its residents. The combined retirement payroll of 13,389 Air Force, 6,570 Navy, 5,220, 1,595 Marines and 391 Coast Guard retirees amounted to a yearly salary of $597.9 million. According to the Economic Impact Analysis prepared by the Financial Analysis Office of the 99 th Comptroller Squadron the total economic impact of Nellis and Creech AFB operations in the fiscal year 2008 amounted to more than $5.0 billion. Warmbrodt Hotel Investments Value Pl ace Extended Stay Hotel Nellis Air Force Base L as Vegas, Nevada 7

8 Competitive Set The Value Place is part of the Las Vegas market. Based on our review of the overall Las Vegas market and discussions with management, we have identified five hotels as economy and extended stay non-gaming hotels and are considered primarily competitive with the Value Place. None of the hotels in the competitive set is exactly like the proposed Value Place hotel as described, so the individual performance of any one hotel is not a true indicator of the subject s like performance. The selected competitive set hotels however, do provide a picture of the marketplace and demonstrate where the proposed hotel is likely to fit. Each of the hotels selected will likely compete with the subject in attracting potential guests to some degree. The following table lists the 3 hotels (including the Value Place) that make up the competitive set and contains 763 guestrooms: Hotel Rooms Year Opened Value Place Nellis Suites The Value Place competes with the limited service extended stay hotels that are primarily located on the Las Vegas Boulevard and Craig Road area quadrant. The hotels in the competitive set were built between 1985 and Competitive Set Survey Weekly Weekly Daily Date Ocpcy Rates Rates Nellis Suites 4/9/ % $325 $46.50 Siegel Suites 4/9/ % $199 $28.40 Source: Property quoted rates Based on conversations with local hospitality professionals, corporate Value Place and other industry professionals, it is anticipated the Property may achieve a daily rate of $38.00 which translates to a $ weekly rate and an occupancy level of 85%. Presently, the average occupancy of the 154 operating Value Place Properties throughout the United States is 80%. Siegel Suites Five Hotels 559 Rooms Warmbrodt Hotel Investments Value Pl ace Extended Stay Hotel Nellis Air Force Base L as Vegas, Nevada 8

9 Competitive Set Map Craig Rd Cheyenne Ave. Las Vegas Blvd Nellis Blvd Nellis Air Force Base 1. Value Place 2. Nellis Suites 3. Siegel Suites Warmbrodt Hotel Investments Value Pl ace Extended Stay Hotel Nellis Air Force Base L as Vegas, Nevada 9

10 Disclaimer /Confidentiality The Recipient of this Confidential Investment Memorandum is hereby advised that no representations or warranties, express or implied, by operation of law or otherwise, are made as to the accuracy or completeness of the information contained herein or in any other confidential materials which may be provided to the Recipient. Further, the Seller of the Property described herein is making no representations or warranties, express or implied, as to the condition, quality or fitness of the Property, except as specifically set forth in an executed Purchase and Sale Agreement. Neither Seller nor Warmbrodt Hotel Investments, Inc, nor any of their respective directors, officers, employees, stockholders, affiliates or agents will have any liability to Recipient or any other person resulting from Recipient s or any other person s use of this Confidential Investment Memorandum or any other confidential materials. The Property will be sold as is, where is, and with all faults as of the date of closing. Recipient will have an opportunity to perform its own examination and inspection of the Property and information relating thereto and must rely solely on its own independent examination and investment expertise and not on any information provided by Seller or Warmbrodt Hotel Investments, Inc. Only those representations and warranties, if any, that are made to Recipient in the Purchase and Sale Agreement when, as, and if same is executed by Recipient and Seller, and subject to such limitations and restrictions as may be specified therein, will have legal effect. Without limiting the generality of the foregoing, any environmental reports, any structural reports, or any other type or kind of report prepared by a third party, if any, included in this Confidential Investment Memorandum or in any other confidential materials which may be provided to Recipient have not been prepared by Seller and neither Seller nor Warmbrodt Hotel Investments, Inc. makes any representations or warranties with respect to the truth, accuracy, or completeness of same and neither Recipient nor its representatives nor any other person shall be entitled to rely on such reports or any information contained therein. Without limiting the foregoing, information contained in this Confidential Investment Memorandum may vary from the date of publishing. In some instances, more complete or up-to-date information may become available following the printing of this Confidential Investment Memorandum. All measurements set forth herein are approximations only based on information hereto available. Actual measurements may vary. The Seller reserves the right to withdraw the Property being marketed at any time without notice, to reject all offers, and to accept any offer without regard to the relative price and terms of any other offer. Any offer to buy must be: (i) presented in a form acceptable to Seller in its sole and absolute discretion; (ii) incorporated in a formal written Purchase and Sale Agreement to be approved by Seller and executed by both parties and (iii) approved by such other parties who may have an interest in the Property. Neither the prospective buyer nor Seller shall be bound until execution of the Purchase and Sale Agreement, which Agreement shall supersede prior discussions and constitute the sole agreement of the parties. Prospective buyers shall be responsible for their costs and expenses of investigating the Property. The information contained herein is submitted to the Recipient on a strictly and permanently confidential basis. By accepting a copy of this Confidential Investment Memorandum, the Recipient agrees that neither it nor any of its employees or advisors shall use the information for any purpose other than evaluating the specific transaction described herein, or divulge such information to any other party. This Confidential Investment Memorandum shall not be photocopied, reproduced or distributed to others without prior consent of Warmbrodt Hotel Investments, Inc. If the Recipient determines not to participate in this transaction, it will promptly return all materials received in the connection herewith, including this Confidential Investment Memorandum, without retaining any copies. Warmbrodt Hotel Investments Value Pl ace Extended Stay Hotel Nellis Air Force Base L as Vegas, Nevada 10