red lion hotel | pocatello..., as an exclusive representative of the seller, is pleased to present...

RED LION HOTEL | POCATELLO1555 Pocatel lo Creek Road | Pocatel lo, ID 83201

Offering Memorandum

NON-ENDORSEMENT & DISCLAIMER NOTICE

CONFIDENTIALITY & DISCLAIMERThe information contained in the following Marketing Brochure is proprietary and strictly confidential. It is intended to be reviewed only by

the party receiving it from Marcus & Millichap and should not be made available to any other person or entity without the written consent of

Marcus & Millichap. This Marketing Brochure has been prepared to provide summary, unverified information to prospective purchasers, and

to establish only a preliminary level of interest in the subject property. The information contained herein is not a substitute for a thorough due

diligence investigation. Marcus & Millichap has not made any investigation, and makes no warranty or representation, with respect to the income

or expenses for the subject property, the future projected financial performance of the property, the size and square footage of the property and

improvements, the presence or absence of contaminating substances, PCB’s or asbestos, the compliance with State and Federal regulations, the

physical condition of the improvements thereon, or the financial condition or business prospects of any tenant, or any tenant’s plans or intentions

to continue its occupancy of the subject property. The information contained in this Marketing Brochure has been obtained from sources we

believe to be reliable; however, Marcus & Millichap has not verified, and will not verify, any of the information contained herein, nor has Marcus

& Millichap conducted any investigation regarding these matters and makes no warranty or representation whatsoever regarding the accuracy

or completeness of the information provided. All potential buyers must take appropriate measures to verify all of the information set forth herein.

Marcus & Millichap is a service mark of Marcus & Millichap Real Estate Investment Services, Inc.

© 2017 Marcus & Millichap. All rights reserved.

NON-ENDORSEMENT NOTICEMarcus & Millichap is not affiliated with, sponsored by, or endorsed by any commercial tenant or lessee identified in this marketing package.

The presence of any corporation’s logo or name is not intended to indicate or imply affiliation with, or sponsorship or endorsement by, said

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PLEASE CONSULT YOUR MARCUS & MILLICHAP AGENT FOR MORE DETAILS.

RED LION HOTEL | POCATELLO1555 POCATELLO CREEK ROAD | POCATELLO, ID 83201

EXCLUSIVELY LISTED BY

O F F I C ES N AT I O N W I D E A N D TH R O U G H O UT C A N A D A

WWW.MARCUSMILLICHAP.COM

EDDY NEVAREZSenior Associate

National Hospitality GroupCell: 818.339.6506

Office: [email protected]

License: CA 01960485

07 INVESTMENT OVERVIEWSECTION 1

19 FINANCIAL ANALYSISSECTION 2

3729

MARKET OVERVIEWSECTION 4

MARKET COMPETITORSSECTION 3

TABLE OF CONTENTS

EXCLUSIVELY LISTED BY:

RED LION HOTEL | POCATELLO1 5 5 5 P O C A T E L L O C R E E K R O A D | P O C A T E L L O , I D 8 3 2 0 1

This information has been secured from sources we believe to be reliable, but we make no representations or warranties, expressed or implied, as to the accuracy of the information. References to square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies. Any projections, opinions, as-sumptions or estimates used herein are for example purposes only and do not represent the current or future performance of the property. Marcus & Millichap Real Estate

Investment Services is a service mark of Marcus & Millichap Real Estate Investment Services, Inc. © 2017 Marcus & Millichap ACT ID Z0000000



RED LION HOTEL | POCATELLO

7

INVESTMENTOVERVIEW

8

EXECUTIVE SUMMARY

OFFERING SUMMARY

VITAL DATA

2019 Pro Forma 1 Year

Price $6,400,000 Cap Rate 7.3% 12.3%

PIP $0 NOI $464,116 $784,524

Down Payment 30% / $1,920,000Net Cash FlowAfter Debt Service

6.6% / $125,909 23.3% / $446,316

Loan Amount $4,480,000

Loan Type SBA 7(a)

Interest Rate 5.75% / 10 years

Price / Room $42,667

Ownership Type Fee Simple

Number of Rooms 150

Number of Buildings 3

Number of Stories 2

Year Built 1979

Lot Size 4.13 Acres

MAJOR EMPLOYERS

EMPLOYER # OF EMPLOYEES

Finance and Administration 1,479

Monte Vsta Hills Hlth Care Ctr 687

State Police Idaho 245

United States Steel Corp 235

Veterans Benefits ADM 228

City of Pocatello 211

US Post Office 203

Home Depot The 200

Varsity Garcia 200

Walmart 200

Costco 196

Virginia Transformer 190

DEMOGRAPHICS

1-Miles 3-Miles 5-Miles

2018 Estimate Pop 11,252 53,166 70,466

2010 Census Pop 10,978 52,016 68,770

2018 Estimate HH 4,141 20,215 26,269

2010 Census HH 4,047 19,865 25,776

Median HH Income $54,645 $45,495 $48,193

Per Capita Income $24,220 $23,533 $23,893

Average HH Income $65,169 $60,959 $62,845

9

INVESTMENT OVERVIEW

Marcus & Millichap’s National Hospitality Group, as an exclusive representative of the seller, is pleased to present for sale the Red Lion Pocatello. The 150-room interior corridor hotel recently renovated in 2017-2018, features nine meeting spaces, a large banquet hall, a conference center, restaurant and indoor patio. Additional revenue is generated from the nearby college, Idaho State University, who frequently host events and meetings at the hotel’s conference center. The Red Lion Pocatello is being offered for sale for $6,400,000 or $42,667 per key. Priced with a capitalization rate of 7% or 3.4 times 2018’s year-end room revenue, this hotel offers significant upside potential for a new investor. Recent renovations over the past year have reduced the PIP requirements for a new owner. The Red Lion Hotel is offered fee simple and unencumbered by debt and management.

Located in the heart of Pocatello, this hotel is 2.7 mi (4.3 km) from Holt Arena and 3 mi (4.8 km) from Idaho State University (ISU). Portneuf Medical Center and L.E. and Thelma E. Stephens Performing Arts Center are also within 6 mi (10 km).

LOCATION

• Price Per Key is Below Replacement Cost

• Recently Renovated in 2017 - 2018

• Large Banquet Hall and Event Centers

• Restaurant / Bar & Lounge

INVESTMENT HIGHLIGHTS

10

OFFERING SUMMARY

PROPERTY SUMMARY

THE OFFERING

Property Red Lion Hotel | Pocatello

Price $6,400,000

Property Address1555 Pocatello Creek Rd

Pocatello, ID 83201

Assessors Parcel Number RPCPP004803

SITE DESCRIPTION

Number of Rooms 150

ADA Rooms 7

Number of Stories 2

Year Built / Renovated 1979 / 2018

Ownership Type Fee Simple

Lot Size 4.13 acre(s)

PROPOSED FINANCING

FIRST TRUST DEED

Loan Amount $4,480,000

Loan Type SBA 7(a)

Interest Rate 5.75%

Amortization 25 Years

Loan Term 10 years

Loan to Value 70%

Second Trust Deed

Loan Type All Cash

CONSTRUCTION

Foundation Concrete

Framing Wood

Exterior Stucco

Parking Surface Asphalt

Roof Asphalt Roof Shingles

ROOM TYPES

NUMBER OF ROOMS ROOM TYPE

105Double Queens &

Single Queens

34 King

4 Suite / Kitchenette

7 ADA Compliant

MECHANICAL

HVAC AC

Elevators No

Fire Protection Sprinklers

CHANGE TO FRANCHISE

Term AC

11

REGIONAL MAP

N


12

LOCAL MAP

N


13

AERIAL PHOTO

N

14

PROPERTY PHOTOS

MARCUS & MILLICHAP closes more transactions than

any other brokerage firm


19

FINANCIAL ANALYSIS

20

STR

JULY 2019

Occupany (%) ADR RevPAR

My Prop Comp Set Index (MPI) My Prop Comp Set Index (ARI) My Prop Comp Set Index (RGI)

Current Month 61.6 65.8 93.6 78.65 80.87 97.3 48.42 53.20 91.0

Year to Date 49.6 52.4 94.7 71.56 76.24 93.9 35.50 39.95 88.9

Running 3 Month 65.3 68.4 95.4 76.25 79.32 96.1 49.77 54.25 91.7

Running 12 Month 47.2 52.4 90.1 72.31 75.12 96.3 34.11 39.33 86.7

JULY 2019 VS 2018 PERCENT CHANGE (%)

Occupany (%) ADR RevPAR

My Prop Comp Set Index (MPI) My Prop Comp Set Index (ARI) My Prop Comp Set Index (RGI)

Current Month 0.3 -7.3 8.1 5.1 0.1 5.1 5.4 -7.2 13.6

Year to Date 11.3 -0.8 12.2 -10.2 -2.7 -7.7 0.0 -3.5 3.6

Running 3 Month 7.8 -1.2 9.1 -3.6 -2.8 -0.8 3.9 -4.0 8.2

Running 12 Month 7.9 -0.9 8.9 -7.0 -3.4 -3.8 0.3 -4.3 4.8

FINANCIAL ANALYSIS

Tab 2 - Monthly Perfomance at a Glance - My Property vs. Competitve SetRed Lion Hotel | Pocatello | 1555 Pocatello Creek Rd | Pocatello, ID 83201-2306 Phone: 208.233.2200

STR #4106 ChainID: IDPOCA MgtCO: None Owner: None

For the Month of: July 2019 Date Created: August 19, 2019 Monthly Competitve Set Data Excludes Subject Property

22

Tab 3 - STAR Summary - My Property vs. Comp Set and Industry SegmentsRed Lion Hotel | Pocatello | 1555 Pocatello Creek Rd | Pocatello, ID 83201-2306 Phone: 208.233.2200



FINANCIAL ANALYSIS

OCCUPANCY % SUPPLY

CurrentMonth

% ChgYear to

Date% Chg

Running 3 Month

% ChgRunning

12 Month% Chg

Month % Chg

YTD % Chg

Run 3 Mon %

Chg

Run 12 Mon %

Chg

Red Lion Hotel | Pocatello 61.6 0.3 49.6 11.3 65.3 7.8 47.2 7.9 0.0 0.0 0.0 0.0

Market: Idaho 80.2 0.7 63.9 -0.1 76.6 -0.6 63.5 0.7 1.0 1.9 1.5 2.4

Market Class: Upper Midscale

80.8 1.2 67.4 0.6 79.0 1.0 66.5 0.5 2.8 3.1 2.7 3.5

Submarket: Idaho South Area

80.7 0.3 62.8 0.4 77.9 -0.2 61.3 1.6 1.7 1.6 1.7 2.2

Submarket Scale: Midscale Chains

82.5 0.5 66.0 1.8 80.4 0.9 64.7 1.6 3.6 1.2 2.5 2.4

Competitive Set: Competitors 65.8 -7.3 52.4 -0.8 68.4 -1.2 52.4 -0.9 0.0 0.0 0.0 0.0

AVERAGE DAILY RATE DEMAND

CurrentMonth

% ChgYear to

Date% Chg

Running 3 Month

% ChgRunning

12 Month% Chg

Month % Chg

YTD % Chg

Run 3 Mon %

Chg

Run 12 Mon %

Chg

Red Lion Hotel | Pocatello 78.65 5.1 71.56 -10.2 76.25 -3.6 72.31 -7.0 0.3 11.3 7.8 7.9

Market: Idaho 126.12 4.3 107.07 2.7 117.45 3.9 106.29 1.6 1.7 1.7 0.9 3.2


124.31 4.1 108.25 1.4 117.63 2.6 107.41 0.0 4.0 3.7 3.7 4.0


116.13 2.3 98.69 1.7 107.40 1.4 97.40 -0.1 2.1 2.1 1.4 4.2


119.12 2.7 102.17 1.3 111.82 1.4 100.85 -0.3 4.1 3.0 3.5 4.1

Competitive Set: Competitors 80.87 0.1 76.24 -2.7 79.32 -2.8 75.12 -3.4 -7.3 -0.6 -1.2 -0.9

23

Tab 3 - STAR Summary - My Property vs. Comp Set and Industry SegmentsRed Lion Hotel | Pocatello | 1555 Pocatello Creek Rd | Pocatello, ID 83201-2306 Phone: 208.233.2200



RevPAR REVENUE

CurrentMonth

% ChgYear to

Date% Chg

Running 3 Month

% ChgRunning

12 Month% Chg

Month % Chg

YTD % Chg

Run 3 Mon %

Chg

Run 12 Mon %

Chg

Red Lion Hotel | Pocatello 48.42 5.4 35.50 0.0 49.77 3.9 34.11 0.3 5.4 0.0 3.9 0.3

Market: Idaho 101.13 5.0 68.47 2.5 89.98 3.3 67.55 2.3 6.1 4.5 4.8 4.8


100.47 5.4 72.92 1.9 92.96 3.6 71.44 0.5 8.3 5.1 6.4 4.0


93.71 2.6 62.01 2.1 83.64 1.2 60.34 1.8 4.4 3.7 2.9 4.1


98.29 3.3 67.41 3.1 89.92 2.3 65.24 1.2 7.0 4.4 4.9 3.7

Competitive Set: Competitors 53.20 -7.2 39.95 -3.5 54.25 -4.0 39.33 -4.3 -7.2 -3.5 -4.0 -4.3

CENSUS/SAMPLE - PROPERTIES & ROOMS PIPELINE

CENSUS SAMPLE SAMPLE % MARKET: Idaho

Properties Rooms Properties Rooms Rooms UNDER CONSTRUCTION PLANNING

Market: Idaho 351 24,578 189 18,099 73.6 Properties Rooms Properties Rooms

Market Class: Upper Midscale Class

94 8,745 81 8,158 93.3 6 572 22 2,030


137 9,229 73 6,628 71.8


49 4,494 46 4,321 96.2

Competitive Set: Competitors 5 593 5 593 100.0

24

FINANCIAL ANALYSIS

HISTORICAL P&L

2016 2017 2018 2019 Proforma

Rooms 150 150 150 150

Available Rooms 54,750 54,750 54,750 54,750

Rooms Sold 29,948 23,816 20,312 25,842

Occupancy 54.7% 43.5% 37.1% 47.2%

ADR $70.45 $72.89 $79.93 $72.31

RevPAR $38.54 $31.71 $29.65 $34.13

Revenue / Room $18,769 $17,189 $15,641 $15,847

Income

Room Revenue $2,100,821 74.6% $1,988,198 77.1% $1,850,587 78.9% $1,870,000 78.7%

F&B Revenue $377,190 13.4% $260,670 10.1% $256,730 10.9% $262,000 11.0%

Other $330,180 11.7% $284,325 11.0% $178,999 7.6% $180,000 7.6%

Events & Catering $7,186 0.3% $45,087 1.7% $59,852 2.6% $65,000 2.7%

Total Revenue $2,185,377 100% $2,578,280 100% $2,346,168 100% $2,377,000 100%

25

2016 2017 2018 2019 ProformaDepartmental Expenses

Rooms $848,158 30.1% $855,909 33.2% $668,193 28.5% $668,193 28.1%

Food & Beverage $240,561 8.5% $213,823 8.3% $236,908 10.1% $246,341 10.4%

Other Operated Depts & Rentals $101,680 3.6% $123,755 4.8% $83,049 3.5% $74,577 3.1%

Total Departmental Expenses $1,190,399 42.3% $1,193,487 46.3% $988,150 42.1% $989,111 41.6%

Gross Operating Income $1,624,978 57.7% $1,384,793 53.7% $1,358,018 57.9% $1,387,889 57.9%

Undistributed Operating ExpensesAdministration & General $224,837 8.0% $191,497 7.4% $176,942 7.5% $176,230 7.4%

Marketing $1,582 0.1% $1,633 0.1% $1,134 0.0% $1,134 0.0%

Franchise Fees $335,347 11.9% $293,762 11.4% $222,283 9.5% $222,283 9.4%

Utility Costs $193,267 6.9% $206,324 8.0% $198,485 8.5% $198,485 8.4%

Property Operations & Maintenance

$123,762 4.4% $123,180 4.8% $47,479 2.0% $36,356 1.5%

Total Undistributed Operating Expenses

$878,795 31.2% $816,396 31.7% $646,324 27.5% $634,488 26.7%

Gross Operating Profit $746,183 26.5% $568,397 22.0% $711,695 30.3% $753,401 31.7%

Fixed ExpensesProperty Taxes $87,832 3.1% $61,404 2.4% $62,103 2.6% $62,103 2.6%

Insurance $91,397 3.2% $78,384 3.0% $60,792 2.6% $60,792 2.6%

Total Fixed Charges $179,229 6.4% $139,788 5.4% $122,895 5.2% $122,895 5.2%

Total Expenses $2,248,423 79.9% $2,149,671 83.4% $1,757,358 74.9% $1,746,494 73.5%

Amount Available for Debt Service & Other Fixed Charges

$566,954 20.1% $428,609 16.6% $588,800 25.1% $630,506 26.5%

Capital Replacement Reserve $112,615 4.0% $103,131 4.0% $93,847 4.0% $95,080 4.0%

Management Fee $84,461 3.0% $77,348 3.0% $70,385 3.0% $71,310 3.0%

Net Operating Income (EBITDA) $369,878 13.1% $248,129 9.6% $424,568 18.1% $464,116 19.5%

26

FINANCIAL ANALYSIS

5 YEAR PROFORMA

2019 Proforma Year 1 Year 2 Year 3 Year 4 Year 5

Rooms 150 150 150 150 150 150

Available Rooms 54,750 54,750 54,750 54,750 54,750 54,750

Rooms Sold 25,842 26,617 27,283 27,828 28,246 28,528

Occupancy 47.2% 48.6% 49.8% 50.8% 51.6% 52.1%

ADR $72.31 $73.76 $75.23 $75.98 $76.74 $77.51

RevPAR $34.13 $35.86 $37.49 $38.62 $39.59 $40.39

Revenue / Room $15,847 $17,524 $18,307 $18,989 $19,571 $19,958

Income

Room Revenue $1,870,000 78.7% $1,963,188 74.7% $2,052,513 74.7% $2,114,499 74.2% $2,167,679 73.8% $2,211,249 73.9%

F&B Revenue $262,000 11.0% $300,000 11.4% $324,000 11.8% $360,000 12.6% $390,000 13.3% $396,000 13.2%

Other $180,000 7.6% $303,000 11.5% $306,000 11.1% $309,000 10.8% $312,000 10.6% $319,200 10.7%

Events & Catering $65,000 2.7% $62,400 2.4% $63,600 2.3% $64,800 2.3% $66,000 2.2% $67,200 2.2%

Total Revenue $2,377,000 100% $2,628,588 100% $2,746,113 100% $2,848,299 100% $2,935,679 100% $2,993,649 100%

27

2019 Proforma Year1 Year2 Year 3 Year 4 Year 5Departmental Expenses

Rooms $668,193 28.1% $532,345 20.3% $572,937 20.9% $612,224 21.5% $649,653 22.1% $684,677 22.9%

Food & Beverage $246,341 10.4% $226,247 8.6% $233,267 8.5% $239,324 8.4% $244,326 8.3% $248,196 8.3%

Other Operated Depts & Rentals

$74,577 3.1% $78,521 3.0% $81,846 3.0% $84,876 3.0% $87,562 3.0% $89,864 3.0%

Total Departmental Expenses $989,111 41.6% $837,113 31.8% $888,052 32.3% $936,424 32.9% $981,541 33.4% $1,022,737 34.2%

Gross Operating Income $1,387,889 58.4% $1,791,475 68.2% $1,858,061 67.7% $1,911,875 67.1% $1,954,138 66.6% $1,970,912 65.8%

Undistributed Operating ExpensesAdministration & General $176,230 7.4% $174,000 6.6% $174,060 6.3% $174,120 6.1% $174,180 5.9% $174,240 5.8%

Marketing $1,134 0.0% $3,000 0.1% $3,060 0.1% $3,120 0.1% $3,180 0.1% $3,240 0.1%

Franchise Fees $222,283 9.4% $176,687 6.7% $184,726 6.7% $190,305 6.7% $195,091 6.6% $199,012 6.6%

Utility Costs $198,485 8.4% $204,953 7.8% $211,441 7.7% $217,061 7.6% $221,729 7.6% $225,373 7.5%

Property Operations & Maintenance

$36,356 1.5% $93,160 3.5% $96,854 3.5% $100,182 3.5% $103,097 3.5% $105,553 3.5%

Total Undistributed Operating Expenses

$634,488 26.7% $651,800 24.8% $670,141 24.4% $684,788 24.0% $697,277 23.8% $707,420 23.6%

Gross Operating Profit $753,401 31.7% $1,139,675 43.4% $1,187,921 43.3% $1,227,087 43.1% $1,256,861 42.8% $1,263,492 42.2%

Fixed ExpensesProperty Taxes $62,103 2.6% $66,000 2.5% $66,000 2.4% $66,000 2.3% $66,000 2.2% $66,000 2.2%

Insurance $60,792 2.6% $36,000 1.4% $36,000 1.3% $36,000 1.3% $36,000 1.2% $36,000 1.2%

Total Fixed Charges $122,895 5.2% $102,000 3.9% $102,000 3.7% $102,000 3.6% $102,000 3.5% $102,000 3.4%

Total Expenses $1,746,494 73.5% $1,590,913 60.5% $1,660,192 60.5% $1,723,212 60.5% $1,780,818 60.7% $1,832,157 61.2%

Amount Available for Debt Service & Other Fixed Charges

$630,506 26.5% $1,037,675 39.5% $1,085,921 39.5% $1,125,087 39.5% $1,154,861 39.3% $1,161,492 38.8%

Capital Replacement Reserve

$95,080 4.0% $105,144 4.0% $109,845 4.0% $113,932 4.0% $117,427 4.0% $119,746 4.0%

Management Fee $71,310 3.0% $78,858 3.0% $82,383 3.0% $85,449 3.0% $88,070 3.0% $89,809 3.0%

Net Operating Income (EBITDA)

$464,116 19.5% $853,674 32.5% $893,693 32.5% $925,706 32.5% $949,363 32.3% $951,937 31.8%


29

MARKET COMPETITORS

30

MARKET COMPETITORS

Address Sale Price Price Per Room Number of Keys Sale Date

TownePlace Suites | Marriot2376 Via Caporatti DrPocatello, ID 83201

$10,400,000 $111,827 93 12/13/13

AmeriTel Inn1440 Bench RdPocatello, ID 83201

$9,719,379 $65,671 148 8/6/12

Best Western1415 Bench RdPocatello, ID 83201

$7,800,000 $52,348 149 11/17/16

Clarion Inn1399 Bench RdPocatello, ID 83201

$7,300,000 $37,244.89 196 8/26/19

Red Lion Hotel | Pocatello(Part of Portfolio)1555 Pocatello Creek RdPocatello, ID 83201

$7,090,484 $47,269 150 7/31/98

Clarion Inn1399 Bench RdPocatello, ID 83201

$6,250,000 $31,887 196 8/17/17

Best Western1415 Bench RdPocatello, ID 83201

$5,600,000 $37,583 149 10/27/13

Ramada Inn133 W Burnside AvePocatello, ID 83201

$4,160,000 $35,862 116 9/20/07

Averages: $7,289,983 $52,461 - -

31

CENSUS/SAMPLE - PROPERTIES & ROOMS PIPELINE

CENSUS SAMPLE SAMPLE % MARKET: Idaho

Properties Rooms Properties Rooms Rooms UNDER CONSTRUCTION PLANNING

Market: Idaho 351 24,578 189 18,099 73.6 Properties Rooms Properties Rooms

Market Class: Upper Midscale Class

94 8,745 81 8,158 93.3 6 572 22 2,030


137 9,229 73 6,628 71.8


49 4,494 46 4,321 96.2

Competitive Set: Competitors 5 593 5 593 100.0

32

MARKET COMPETITORS

Address:Red Lion Hotel | Pocatello1555 Pocatello Creek Rd

Pocatello, ID 83201

Sale Price $6,400,000

Price Per Room $42,667

Number of Keys 150

Sale Date -

Address:TownePlace Suites | Marriot

2376 Via Caporatti DrPocatello, ID 83201



Number of Keys 93

Sale Date 12/13/13

Address:AmeriTel Inn

1440 Bench RdPocatello, ID 83201



Number of Keys 148

Sale Date 8/6/12

Subject Property

33

Address:Best Western




Number of Keys 149

Sale Date 11/17/16

Address:Clarion Inn



Price Per Room $37,244.89

Number of Keys 196

Sale Date 8/26/19

Address:

Red Lion Hotel | Pocatello(Part of Portfolio)

1555 Pocatello Creek RdPocatello, ID 83201



Number of Keys 150

Sale Date 7/31/98

Subject Property

34

MARKET COMPETITORS

Address:Best Western




Number of Keys 149

Sale Date 10/27/13

Address:Clarion Inn




Number of Keys 196

Sale Date 8/17/17

Address:Ramada Inn

133 W Burnside AvePocatello, ID 83201



Number of Keys 116

Sale Date 9/20/07


37

MARKET OVERVIEW

38

MARKET OVERVIEW

NORTHWEST

National Parks Bring Wave of Tourism Spending to Wyoming, Montana

Recreational activities attract tourists to smaller locales while supply pressures mount in larger markets. Numerous parks and recreational activities will continue to lure tourists to Wyoming and Montana as social media platforms and tourism campaigns highlight local attractions. Wyoming, in particular, registered an increase in occupancy last year amid strong visitor spending. The upward trend should continue through 2019 as the state launches a new tourism campaign highlighting 150 years of women’s suffrage to attract more female travelers. On the other hand, supply pressures are mounting in Washington and Oregon, particularly in the major markets of Portland and Seattle. Both metros have more than 6.5 percent of their total room inventory underway, which will likely continue placing downward pressure on occupancy rates and stalling RevPAR growth in each market this year. Overall, strength in Wyoming and Montana should outweigh supply pressures in Washington and Oregon, supporting an uptick in regional occupancy.

Steady growth throughout Idaho and high yields will entice investors. Improving property performance and higher-than-regional-average returns will keep demand steady for properties throughout Idaho. The state offers first-year returns averaging in the 12 percent band based on property location and chain scale. Buyers in the state are targeting properties in Boise, Post Falls and Coeur d’Alene. The bulk of overall regional trading volume will remain in Washington and Oregon, with properties in Seattle and Portland highly sought after. Hotels in both markets trade with cap rates in the mid-10 percent area. Independent hotels in both Portland and Seattle attracted buyers, with opportunistic investors acquiring older properties built prior to the 1970s.

States: Idaho, Montana, Oregon, Washington, Wyoming

2019 Demand Growth3.8% Year-Over-Year Room Nights

39

NORTHWEST

2019 REGIONAL HIGHLIGHTS

2.5%120bps20%

Percent of Inventory Under construction as of December 2018

• New regulations surrounding short-term rentals went into effect at the beginning of the year in Seattle. Anyone operating these rentals must have a regulatory license that lasts one year, on top of the license tax certificate. Additionally, owners can only operate up to two units, one of which must be the primary residence. These new regulations may sway some from placing their homes on sites like Airbnb,boding well for hotel demand.

• Expansions made to the Boise Centre will provide the city more capacity to host larger events more often. New meetings and events could bring more visitors to the state, benefiting area hotels.

• Expansions at the Glacier Park International Airport could bring additional visitors to Northwest Montana, particularly as more individuals travel to the state to visit Glacier National Park. Visitation to the park increased by 1.1 million visitors between 2013 and 2017.

Five-Year Occupancy Growth 2014-2019

Five-Year RevPAR Growth

*2018 Recent Openings; Under Construction as of December 2018 Sources: CoStar Group, Inc.; STR, Inc.; Real Capital Analytics

40

NORTHWEST

MARKET OVERVIEW

2019 REGION FORECAST

Nearly 7,800 rooms are under construction throughout the region and an additional 8,600 rooms are expected to break ground within the next 12 months. Washington will lead delivery volume, receiving 4,700 of the rooms underway.

Supplyup 2.3%

Occupancyup to 30 bps

ADR up to 1.2%

RevPARup 1.6%

Investment

Building on a 30-basis-point increase recorded in 2018, occupancy throughout the Northwest region climbs to 64.7%.

Led by increases in Idaho and Washington, the average daily rate will edge up to $122.79. In the prior year, ADR rose 1.6%.

Steady increases in occupancy and the average daily rate will lift RevPAR up to $81.55 regionally. In 2018, the rate registered a 1.8 percent rise.

Heightened room demand in Wyoming will encourage some buyers to inject capital into the state. Smaller hotels of less than 100 rooms will be highly targeted, particularly in the Jackson and Cheyenne areas.

* Forecast Sources: CoStar Group, Inc.; STR, Inc.; Real Capital Analytics

41

CREATED IN JULY 2019

DEMOGRAPHICS

Population 1 Mile 3 Mile 5 Mile2023 Projection

Total Population 11,541 55,392 73,642

2018 Estimate


2010 Census


2000 Census


Daytime Population

2018 Estimates 11,611 67,850 83,082

Households 1 Miles 3 Miles 5 Miles2023 Projection

Total Households 4,303 21,205 27,683

2018 Estimate


Average (Mean) Household Size 2.70 2.58 2.62

2010 Census


2000 Census


Housing Units 1 Miles 3 Miles 5 MilesOccupied Units

2023 Projects 4,303 21,205 27,683

2018 Estimate 4,371 21,591 27,982

Households by Income 1 Mile 3 Mile 5 Mile2018 Estimate

$200,000 or More 1.80% 2.10% 2.04%

$150,000 - $199,000 2.88% 2.78% 3.32%

$100,000 - $149,000 12.57% 10.18% 10.72%

$75,000 - $99,999 14.79% 12.35% 12.88%

$50,000 - $74,999 22.38% 18.94% 19.59%

$35,000 - $49,999 13.28% 13.48% 13.35%

$25,000 - $34,999 10.67% 11.46% 11.13%

$15,000 - $24,999 11.38% 14.00% 12.94%

Under $15,000 10.27% 14.69% 14.03%

Average Household Income $65,169 $60,959 $62,845

Median Household Income $54,645 $45,495 $48,193

Per Capita Income $24,220 $23,533 $23,893

Population Profile 1 Mile 3 Mile 5 MilePopulation 25+ by Education Level

2018 Estimate Population Age 25+ 7,074 33,421 44,162

Elementary (0-8) 1.08% 1.52% 1.53%

Some High School (9-11) 5.60% 6.57% 6.77%

High School Graduate (12) 25.81% 26.46% 25.90%

Some College (13-15) 27.50% 28.29% 28.70%

Associate Degree Only 7.42% 8.65% 8.80%

Bachelors Degree Only 22.19% 19.25% 19.20%

Graduate Degree 9.92% 8.58% 8.41%

42

DEMOGRAPHICS

POPULATIONIn 2018, the population in your selected geography is 79,741. The population has changed by 12.47% since 2000. It is estimated that the population in your area will be 83,138.00 five years from now, which represents a change of 4.26% from the current year. The current population is 49.82% male and 50.18% female. The median age of the population in your area is 33.07, compare this to the US average which is 37.95. The population density in your area is 253.28 people per square mile.

RACE & ETHNICITYThe current year racial makeup of your selected area is as follows: 86.26% White, 0.98% Black, 0.29% Native American and 1.32% Asian/Pacific Islander. Compare these to US averages which are: 70.20% White, 12.89% Black, 0.19% Native American and 5.59% Asian/Pacific Islander. People of Hispanic origin are counted independently of race. People of Hispanic origin make up 9.53% of the current year population in your selected area. Compare this to the US average of 18.01%.

HOUSEHOLDSThere are currently 29,331 households in your selected geography. The number of households has changed by 15.00% since 2000. It is estimated that the number of households in your area will be 30,882 five years from now, which represents a change of 5.29% from the current year. The average household size in your area is 2.65 persons.

INCOMEIn 2018, the median household income for your selected geography is $50,182, compare this to the US average which is currently $58,754. The median household income for your area has changed by 37.52% since 2000. It is estimated that the median household income in your area will be $57,916 five years from now, which represents a change of 15.41% from the current year. The current year per capita income in your area is $24,181, compare this to the US average, which is $32,356. The current year average household income in your area is $64,568, compare this to the US average which is $84,609.

EMPLOYMENTIn 2018, there are 27,940 employees in your selected area, this is also known as the daytime population. The 2000 Census revealed that 60.61% of employees are employed in white-collar occupations in this geography, and 39.42% are employed in blue-collar occupations. In 2018, unemployment in this area is 3.67%. In 2000, the average time traveled to work was 18.00 minutes.

HOUSINGThe median housing value in your area was $160,495 in 2018, compare this to the US average of $201,842. In 2000, there were 17,640 owner occupied housing units in your area and there were 7,867 renter occupied housing units in your area. The median rent at the time was $387.

N


RED LION HOTEL | POCATELLO1555 Pocatel lo Creek Road | Pocatel lo, ID 83201

Eddy Nevarez

PRESENTED BY

Senior AssociateNational Hospitality Group

Encino OfficeCell: 818.339.6506

Office: 818.212.2690Fax: 818.212.2710

[email protected]: CA 01960485

www.marcusmillichap.com

red lion hotel | pocatello..., as an exclusive representative of the seller, is pleased to present...

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