the peninsula hotel (property investment finance)
TRANSCRIPT
Group 6 (Fall 2014)
Chi Yu Chen (Peter)Danni LuSutrisno Tan Wut Yi Soe
Agenda
Market Overview
Property Location
Property Description
Property Pro-Forma Cash
Flows
Market Overview
History
The Peninsula New York is housed in a 23-story, 1905 landmark building on Fifth Avenue and 55th Street in mid-town Manhattan. The hotel, acquired by the HSH Group (The Hong Kong and Shanghai Hotels, Limited) in 1988, carries an old world elegance with modern interiors. Peninsula Hotels Group is one of the world’s premier hospitality brands and the standard of the New York property’s rooms reflect this. Classically styled without being staid, each room features intuitive bedside electronic controls, a marble bathroom and Oscar de la Renta toiletries that are exclusive to Peninsula Hotels.
Location
New York City is arguably the world’s most exciting city, home to some of the most recognizable and cherished landmarks and attractions. The island of Manhattan alone packs more legendary icons into one area than any other city, and with so much to see and do, a trip to New York may seem a little overwhelming. We have compiled some of the city's most popular attractions, some evergreen and some new and noteworthy. All are worth a visit.
700 Fifth Avenue of 55th Street, 10019, USA
+ 212 956 2888
17 miles (28km) from John F. Kennedy/10miles(15km) from LaGuardia/ 15 miles(25km) from Newark
Transportation
MAP In-House Transportation
The Peninsula New York provides only the best for its guests with a bespoke Peninsula Edition BMW house car based on availability or, for guests who have booked a suite. This complimentary three-hour chauffeur-driven service will allow our customers to explore the city in one of two MINI Cooper S Clubmans customized with refrigerators, iPod connections and more for true Peninsula style and comfort.
Public Transportation
Take E, M train and get off at 5 Ave/53 St and walk to The Peninsula New York about 2 minutes (0.1 miles).
Crime Rate
Local Business and Shop
The Peninsula places you amid world-class shopping: Armani, Prada, and Gucci are all less than 2 blocks away.
Local Attractions Paley
ParkSt. Thomas Church
Prefer culture to couture? The Peninsula is just 3 blocks from both the Theater District and the Museum of Modern Art. For more organic views, spend some downtime in Central Park, only 4 blocks north, offering 843 acres of green space and unparalleled people-watching. MOMACentral
Park
Features & Amenities
Restaurant & Bar
Vu hair NY
The Peninsul
a SpaThe Pool Fitness
Center
Salon De NingJust one of the spectacular dining options at the Peninsula New York, Salon De Ning is a top-rated rooftop bar and lounge. One of New York’s hottest hubs, Salon De Ning features two outdoor terraces, Chinese-style day beds, and spectacular NYC views.
Fitness Center and PoolA fitness enthusiast’s paradise, the fitness center at the Peninsula New York boasts a range of up-to-the-minute equipment, a sun-lit yoga studio, and personal trainers. The fitness center also features a large glass-enclosed indoor pool with stunning views, and food and drink service.
The Peninsula Spa by ESPANamed a five-star spa by Forbes Travel guide, The Peninsula Spa by ESPA is a retreat like no other. Recently awarded the #1 Hotel Spa in the USA by Condé Nast, this city-sanctuary offers treatments and therapies influenced by philosophies from across the globe.
Floor Plan
Superior Room
Size 370 sq ft / 34 sq m
Rates from US$ 595 per night
Interior View
Floor Plan
Deluxe SuiteSize1,050 sq ft / 98 sq m
Rates from US$ 4,100 per night
Interior View
Exterior View
Finance
Items Amount
Purchase Price $647,275,087.89 (Going in cap rate: 7.1%)
Cash on Hand $100,000,000Loan Amount $547,275,087.89LTV 84.55%Mortgage Interest 4.043%, 30 yearsDebt Service $17,837,748
Major Expenses Items Assumptions Reference
Rent $800 (185 Rooms, 54 Suites) Peninsula Website
Vacancy RateYear 1: 13%Year 2: 12%Year 3: 11%
Year 4-6: 8-10%Market Report
RE Taxes 6,545,196 Market Report
Management Fee 5% (EGI) Given
Utilities $10,000 Per Room Projection
CAM $24,000 Per Room Projection
Admin And Marketing $45,000 Per Room Projection
Insurance $3,000 Per Room Projection
Cash Flow
IRR
Cash Flow in
Year 2014 2015 2016 2017 2018 2019
Price/Net
Operating
Income
(647,275,087.89)
45,956,531.24
46,458,003.93
46,943,113.62
47,411,042.18
47,860,930.54
Loan/Debt
Service 547,275,087.
89(17,837,747.
99)(17,837,747
.99)(17,837,747
.99)(17,837,747
.99)(17,837,747.
99)
Sale Price
(Exit cap rate
8.6%)
- - - - - 561,533,449.89
Payoff Loan - - - - -
(518,247,846.97)
Total (100,000,000)
28,118,783.25
28,620,255.94
29,105,365.64
29,573,294.19
73,308,785.47
IRR
21.51 %
Collage (Selfie)
“Great investors need to have the right combination of intuition, business sense and investment talent” -Andrew Lo-
Citations
http://www.nycgo.com/articles/nyc-statistics-page http://
newyork.peninsula.com/en/special-offers?gclid=CJLxo4-LrsICFW4V7AodNiAAlA
http://www.propertyshark.com/mason/Property-Report/?propkey=20577 http://www.bankrate.com/ https://www.google.com/url?
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https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=2&cad=rja&uact=8&ved=0CCYQFjAB&url=http%3A%2F%2Fwww.hvs.com%2Fjump%2Farticle%2Fdownload.aspx%3Fid%3D6766&ei=9zSBVM_pNsGeyASikIGQBQ&usg=AFQjCNFueNMz9Mtjlzxkn3dDbonDx6-0zg&sig2=N335QFnViEr4bGDRNu3TYg&bvm=bv.80642063,d.aWw