IA, Iowa Falls, Super 8 Offering Memorandum · PDF fileLocation Financial Analysis Competitive...

410.489.5900 .MBAHOTELS.

Washington DC • New York • Memphis • Birmingham • Cedar Rapids • Capital Funding

Super 8 Iowa Falls, Iowa

Offering Memorandum

Contact Listing Broker : Tim Duffy 410.489.5900 x17 641.919-7475 T @MBAH .

Confidential Investment Offering MBA Hotel Brokers Inc.

Information is believed accurate but is not guaranteed by MBA Hotel Brokers Page: 2

Super 8, Iowa Falls, Iowa

410.489.5900 .MBAHOTELS.

Table of Contents

Disclaimer & Confidentiality Agreement

Opportunity

Property Description

Location

Financial Analysis

Competitive Set

Demand Generators

Area Information

About MBA Hotel Brokers




410.489.5900 .MBAHOTELS.

DISCLAIMER The confidential information, analyses, and projections contained herein are provided solely for the information of prospective purchasers and no warranty or representation as to accuracy or completeness is made by the Seller or MBA Hotel Brokers, their subsidiaries or affiliates, and no legal liability is assumed or implied with respect thereto. The property is being sold “as is” without any warranties whatsoever, expressed or implied. Prospective purchasers must, therefore, rely exclusively on their own investiga-tions, interpretations and analyses in connection with this offering and not on any information provided by Seller or MBA Hotel Brokers. This sale offering is made subject to errors, omissions, prior sale, change of price or terms, or withdrawal from the market without notice. Information is for guidance only and does not constitute all or any part of a contract. The materials contained herein are confidential, furnished solely for the purpose of considering the purchase of the property described herein and is not to be used for any other purpose or made available to any other person without the prior written consent of the owner. This confidential memorandum is the property of MBA Hotel Brokers, and is intended to be used only by such parties to whom Broker has delivered the memorandum or to whom Broker has approved such delivery. If you do not wish to pursue negotiations leading to this acquisition, or if in the future you discontinue such negotiations, you agree to return this confidential memorandum to MBA Hotel Brokers. The firm MBA Hotel Brokers is marketing the property. All Purchasers recognize that the Broker represents the Seller in this transaction. The fact that the Broker provides guidance to the Buyer / prospective purchaser and /or makes recommendations regarding financing does not create an agency relationship between Purchaser and Broker. The Seller is responsible for paying all brokerage fees associated with the sale of the aforementioned property. The Seller and Broker specifically make no representation whatsoever about any environmental conditions on the property, including but not limited to issues such as asbestos, hazardous waste, petroleum leaks or spills. Without limiting the generality of the foregoing, any environmental reports, any structural reports, or any other type or kind or report prepared by a third party, if any, included in the confidential memorandum have not been prepared by Seller and neither Seller nor MBA Hotel Brokers makes any representations as to the truth, accuracy, or completeness of same and neither prospec-tive purchaser, 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 memorandum may vary from the date of publishing. In some instances, more complete or up to date information may have become available following the creation of this memorandum.




410.489.5900 .MBAHOTELS.

Investment Highlights 46 Key. 2 Story. Interior Corridors.

Business is Growing

3 year Revenue Growth Trend

2015 Room Revenue Nearly $600,000

Employee-run = On Automatic Pilot for the Absentee Owner

Upside to Reduce Costs and Increase Profitability with Onsite

Management

Offered 3 X Room Revenue

Owner Ready to Sell!

OpportunityOffering Price: $1,795,000




410.489.5900 .MBAHOTELS.

GUEST AMENITTIES

Hotel Services and Amenities:

Indoor Heated Pool

Business Center

Meeting Room: Accommodates 25

High Speed Internet Access

Ice Machine

Vending machine

Smoking and Non-smoking Rooms

Free Breakfast Available

Guest Laundry

Pet Friendly

Large Vehicle Parking

Property Description

Services/Amenities in All Rooms:

Wireless high speed internet

Coffee/ tea maker

Hairdryer

Cable TV with HBO

Refrigerators available

Personal Heat/ AC unit

Iron & ironing boards

Free local calls

Location 839 S Oak St. Iowa Falls, Iowa 50126 PROPERTY DESCRIPTION

46 Keys 1 Building 2 Stories, Interior Corridor




410.489.5900 .MBAHOTELS.

Property Photographs




410.489.5900 .MBAHOTELS.

Location

Location Highlights Located Off U.S. Highway 65

Annual Average Daily Traffic 7,800 in 2013

4 miles to U.S. Highway 20, Main Northern Iowa East-West Highway

Annual Average Daily Traffic 8,700 in 2013

54 miles to Waterloo, IA

68,364 Population Waterloo (2014)

80 miles to Des Moines, IA

209,220 Population Des Moines (2014)

105 miles to Cedar Rapids, IA

129,195 Population Cedar Rapids (2014)

142 miles to Dubuque, IA

58,436 Population Dubuque (2014)




410.489.5900 .MBAHOTELS.

Location

Nearby Restaurants

Pizza Hut

Plaza Veracruz

Subway

Las Flores

Pizza Ranch

Coffee Attic and Book Cellar

502 Grill House

Chuong Garden

McDonald’s

Red Rooster Grill

Dairy Queen Brazier

Princess Grill & Pizzeria

Heavenly’s A Creative Bakery




410.489.5900 .MBAHOTELS.

Financial Analysis

Super 8, Iowa Falls Investor Analysis Proforma

Number of Rooms 46

Purchase Price 1,795,000 Room Revenue (Based on 2015 Actual) 593,141

Projected New Owner Net Operating Income 30% 177,942

USES OF FUNDS

Purchase price 1,795,000

Settlement costs (est) 2.00% 35,900

Total Project Cost 1,830,900

SOURCES OF FUNDS

Down payment 20.00% 366,180

Bank Loan 1,464,720

MORTGAGE PAYMENTS

Bank Loan 1,464,720

Rate to be determined 5.50%

Term to be determined 25

Monthly payment 8,995

Annual Payment 107,936

CASH FLOW

Net Operating Income 177,942

Annual mortgage payment (107,936)

NET CASH FLOW 70,006 Debt coverage ratio 1.6 (NOI / Annual payment)

Loan to value 80.0% (Loan amount / total project cost)

Capitalization rate 9.9% (NOI / purchase price) Cash on cash return 19.1% Room rev multiplier 3.03 (Price / room revenue)

Price per room 39,022 (Price / no. rooms)

Revenue per room 12,894 (Revenue / no. rooms)

NOTE: All financing and closing costs estimates are subject to change and are not guaranteed by MBA Hotel Brokers Inc. These are an estimate of current market conditions only and will vary.

(Buyer cash flow / down pmt)




410.489.5900 .MBAHOTELS.

Financial Analysis Super 8 Iowa Falls

Profit and Loss 2013 - 2015 2013 2014 2015

Income Room Revenue 472,593.74 100.00% 541,011.20 100.00% 593,141.12 100.00% Total Income 472,593.74 100.00% 541,011.20 100.00% 593,141.12 100.00%

Cost of Sales Purchase 27,006.63 5.71% 16,479.39 3.05% 56,809.17 9.58% Store Supplies 13,679.38 2.89% 20,322.03 3.76% 13,239.77 2.23% Payroll 104,230.56 22.06% 115,473.04 21.34% 114,677.32 19.33% Advertising Exp. 920.00 0.19% 0.00 0.00% 260.00 0.04% Franchise Fees 48,222.69 10.20% 55,989.14 10.35% 75,595.22 12.74% Total Cost of Sales 194,059.26 41.06% 208,263.60 38.50% 260,581.48 43.93%

Operating Expenses Cleaning 4,877.96 1.03% 2,724.96 0.50% 8,337.75 1.41% Depreciation 26,878.00 5.69% 41,930.00 7.75% 50,246.00 8.47% Insurance 14,095.15 2.98% 11,382.50 2.10% 11,557.00 1.95% Laundry and Uniforms 10,103.42 2.14% 0.00 0.00% 0.00 0.00% License and Permits 429.40 0.09% 1,076.50 0.20% 326.50 0.06% Alarm 140.17 0.03% 315.04 0.06% 381.99 0.06% Office 144.45 0.03% 189.88 0.04% 0.00 0.00% Professional Fees 3,300.00 0.70% 7,377.35 1.36% 71,007.39 11.97% Repairs and Maintenance 16,573.00 3.51% 8,675.84 1.60% 1,915.47 0.32% Cable 8,060.05 1.71% 8,126.35 1.50% 8,277.15 1.40% Taxes Real Estate 38,725.00 8.19% 38,275.00 7.07% 31,721.00 5.35% Taxes Payroll 10,342.89 2.19% 15,426.87 2.85% 12,448.72 2.10% Telephone 2,942.18 0.62% 2,220.93 0.41% 2,605.04 0.44% Travel 0.00 0.00% 0.00 0.00% 706.56 0.12% Utilities - Electric 36,972.82 7.82% 40,156.87 7.42% 37,983.10 6.40% Utilities - Gas 1,008.00 0.21% 74.20 0.01% 0.00 0.00% Utilities - Water 12,461.96 2.64% 11,492.04 2.12% 11,941.21 2.01% Outside Services 1,750.00 0.37% 0.00 0.00% 0.00 0.00% Postage & Miscellaneous 0.00 0.00% 8.26 0.00% 1,170.86 0.20% Bank Charges 12,431.90 2.63% 15,804.93 2.92% 15,893.93 2.68% Total Operating Expenses 201,236.35 42.58% 205,257.52 37.94% 266,519.67 44.93%

Operating Income 77,298.13 16.36% 127,490.08 23.57% 66,039.97 11.13%

Add Backs Depreciation 26,878.00 5.69% 41,930.00 7.75% 50,246.00 8.47%

Adjusted Net Operating Income 104,176.13 22.04% 169,420.08 31.32% 116,285.97 19.61%




410.489.5900 .MBAHOTELS.

Financial Analysis Super 8 Iowa Falls

Operating Performance

2013 2014 2015

Occupancy 48.65% 49.66% 53.47% ADR $62.38 $66.78 $64.78 RevPAR $30.35 $33.16 $34.64 Room Revenue $509,142.29 $556,627.49 $581,423.75 Total Revenue $571,741.02 $636,349.36 $653,443.08

Rooms 14790 16790 16790




410.489.5900 .MBAHOTELS.

Competitive Set Super 8 Iowa Falls (Subject) 2 839 S Oak St. Iowa Falls, IA 50126 46 rooms. 2 story. Interior corridors. Amenities: Indoor Pool, Free Breakfast, Coffee/ Tea, Wi-Fi Internet, Business Center, Truck Parking

AmericInn Hotel & Suites Iowa Falls 810 S Oak St. Iowa Falls, IA 50126 < 1 Mile 52 rooms. 2 story. Interior corridors. Built: 1998 Amenities: Indoor Pool, Free Breakfast, Free Wi-Fi, Smoke Free, Meeting Room

Americ Inn Lodge & Suites Hampton 702 Central Ave West, Hampton IA 18.7 miles 41 rooms. 2 story. Interior corridors. Amenities: Indoor Pool, Spa Tub, Free Breakfast, Free Wi-Fi, Busi-ness Center, Meeting Room

Super 8 Webster City 305 Closz Dr. Webster City, IA 50595 32.4 miles 44 rooms. 2 story. Interior corridors. Amenities: Indoor Pool, Free Breakfast, Free Wi-Fi, Business Cen-ter, Barbecue Grill, Truck Parking, Game Room

Best Western Norseman Inn 3086 220th Street, Williams IA 50271 21.0 miles 33 rooms. 1 story. Interior corridors. Amenities: Bar/ Lounge, Conference Room, Free Breakfast, Free Wi-Fi, Business Center, Game Room




410.489.5900 .MBAHOTELS.

Demand Generators U.S. Route 20 (Highway 20) is a major highway in the U.S. It stretches from east to west coast, and is the longest road in the U.S. The highway goes through twelve states and intersects ten Interstate highways. The annual average daily traffic count in 2013 was 8,700 vehicles at the exit for U.S. Route 65. U.S. Route 65 (Highway 65) is a north-south highway which runs from Louisiana to Minnesota, about 998 miles. There are intersections with seven Interstate highways. The annual average daily traffic count in 2013 was 7,800 vehicles, near the Super 8. Ellsworth Community College (2 miles) is a two-year community college, which was founded in 1890. In September 2007, it was rated the 17th Best Community College in the nation, by the Washington Monthly. There are three degree programs: Associates in Arts, Associates in Science, and Career/ Technical Degrees. The athletics program competes in nine intercollegiate sports and its mascot is the Panther. Total enrollment is estimated about 1,000 students. The Swinging Bridge is a suspension walking bridge across the Iowa River. It was originally built in 1897 and re-built multiple times, most recently opened in 1989. On one side of the bridge is Assembly Park which includes a picnic shelter, playground, tennis and basketball courts and walking trails. The Scenic City Empress is a double-decker pontoon boat which offers river cruises and cruise lunches. Passengers enjoy the beautiful scenery of limestone bluffs, historic homes, wildlife, and the Iowa Swinging Bridge. Pine Lake State Park offers 668 acres of woodland, rivers, and lakes. Of special interest are the ancient white pine trees, up to 250 years old. It encompasses two lakes: Lower Pine Lake, and Upper Pine Lake. Activities include hiking, fishing, swimming, boating, camping, and picnicking.




410.489.5900 .MBAHOTELS.

Area Information

Iowa Falls is a city in Hardin County, Iowa. The city is nicknamed “the Scenic City” because of its natural beauty. It is a regional transportation center, located along U.S. Route 20 and 65, as well as the Canadian National and Union Pacific Railroads. The city was founded in 1856 as a frontier town. There are 11 properties on the national register of historic places. Local industries include Berry Iowa, Campbell Supply, Cargill, CMC Joist, Hawkeye Renewable, Iowa Select, IVESCO, IPC, and Martin Marietta. Metropolitan Opera House, opened in 1899 is on the National Register of Historic Places. When it opened, it was purportedly a grander building than the play house in Des Moines. The Opera House was re-furbished and re-opened in 2013. Hugh Jackman stayed in Iowa Falls for the weekend to attend the Grand Re-opening and the premiere of “Prisoners” and “The Wolverine”. The Dow House was built in 1909 as a personal residence. It has been fully restored by the historical society. Tour the home including period furnishings, view a large collection of Iowa Falls photographs, and walk the period gardens. Pat Clark Art Collection. Pat Clark was born and raised in Iowa Falls. In 1997 she donated her personal art collection from around the world to the Ellsworth Foundation, to directly benefit the students of the Ellsworth Community College and the community of Iowa Falls. The goal is to offer “a window on the international world of art”. There are two opportunities for golfing in Iowa Falls. The Meadow Hills Golf Course is a public course, established in 1964, which offers 9 holes and a par of 36. The Highland Country Club offers the 9-hole “Highland” course with a par of 36, originally opened in 1903.




410.489.5900 .MBAHOTELS.

About Our Brokers Charlie Fritsch, President Charlie Fritsch began his real estate career in 1984. He founded MBA Hotel Brokers in 1997, and founded MBA Capital Funding, Inc. in 2004. Charlie Fritsch earned the designation of Certified Hotel Broker (C.H.B.) in 2001 and brings 23 years of experience in commercial real estate development, management, financing, and brokerage to the company. Charlie is licensed in Maryland, Virginia, West Virginia, Pennsylvania, New York, and Iowa. Phone: (410) 489-5900 x14. Email: [email protected]

John Downes, Associate Broker John Downes has 30 years of experience in the hospitality industry, including positions of Franchise Sales Director, Director of Development, and experience with several hotel management companies located in the Eastern section of the United States. Licensed as an Associate Broker in Maryland, and joined MBA Hotel Brokers in 2010. Phone: (410) 746-5609. Email: [email protected]

Suryakant “Suresh” Patel, Associate Broker Suresh Patel has a decorated career in business management and sales over a span of 27 years. Suresh has experience with hotel transactions including short sales, bank sales, and top performers. Suresh has been a hotel broker with MBA Hotel Brokers since 2007. He is licensed in Missis-sippi, Tennessee, and Arkansas. Phone: (901) 674-6105. Email: [email protected]

Tim Duffy, Associate Broker Tim Duffy has over 14 years experience as a hotel real estate agent and broker with MBA Hotel Brokers, since joining in 2002. Tim also brings ex-perience in sales, marketing, and hotel management. Tim is licensed in Iowa and Missouri and is active throughout the Midwest and Southeast. Phone: (641) 919-7475. Email: [email protected]

Urmish Patel, Associate Broker Urmish R. Patel has over 30 years of experience in the hotel industry including operations and transactions as a Real Estate Licensee since 1989. MBA Hotel Brokers welcomed Urmish to the team in 2012. Urmish holds a Real Estate Broker license in Alabama and Georgia for MBA Hotel Brokers. Phone: (205) 982-9171. Email: [email protected]




410.489.5900 .MBAHOTELS.

About Our Brokers Tom Duffy, Associate Broker Tom Duffy is a seasoned real estate broker with over 15 years of brokerage experience since getting licensed in 1989. Tom is deeply familiar with the commercial real estate market of the Northeast, including Boston. Tom is licensed in New Hampshire and Massachusetts. Phone: (603) 303-3039. Email: [email protected]

Michael Kinui, Associate Broker Michael Kinui has vast experience performing commercial Broker Opinion of Value valuations for asset management companies and banks. He is also an expert in REO/ short sale and preservation. Michael is a licensed broker in New York and joined MBA Hotel Brokers in 2013. Phone: (914) 703-2578. Email: [email protected]

Lynda Drehmer, Capital Markets Advisor Lynda Drehmer has more than 30 years of experience in numerous area of banking. As Capital Markets Advisor for MBA Capital Funding Lynda procures loans for buyers of all hospitality and commercial property types. Lynda is experienced in various programs including the govern-ment-sponsored SBA 7A, SBA 504, and USDA B&I loans, plus CMBS loans, recourse and non-recourse loans. Phone: (410) 489-7500. Email: [email protected]

MBA Capital Funding

MBA Capital Funding Inc. is a commercial mortgage and financing services firm, spe-cializing in arranging debt and debt structures. For 30+ years we have been arranging financing for all hospitality property types for acquisition and refinance. Our network of Lenders is broad and deep. The capital markets advisors of MBA Capital Funding Inc. are trained to evaluate your financing request and determine the best loan program and financing structure for the least amount of cash down, and the lowest interest rate. In short, whatever your hospitality property financing needs, we will seek to find the best solution. Our very competitive fee is based on the size of your loan and other fac-tors which we can discuss. MBA Capital Funding Inc. is based on integrity and dedicat-ed to an open and honest relationship with you and our Lenders.




410.489.5900 .MBAHOTELS.

The MBA Advantage

Integrity You Can Trust

MBA Hotel Brokers is a national real estate brokerage firm focused exclusively on

hospitality properties. Since 1997, MBA Hotel Brokers has been advising on hotel

investment and disposition strategies across the U.S. and abroad. MBA Hotel Brokers

have worked with buyers and sellers from the largest hotel investment firms to first time

hotel owners. We can advise you through any hotel transaction. MBA Hotel Brokers

has 7 licensed brokers with a constant flow of listings in every region to help you find

the right property for your needs. A capital markets advisor from MBA Capital Funding

can also help you secure the best financing for your acquisition.

Why Sell Your Hotel with MBA?

Integrity, Knowledge, and Experience:

MBA Hotel Brokers offers client focused hotel brokerage services that go beyond

expectations to deliver exceptional results with unparalleled integrity. We have an

unwavering commitment to serving your interests. The MBA Hotel Brokers Team has a

deep working knowledge of the hospitality industry, and decades of commercial real

estate experience to successfully sell any size hospitality investment asset or portfolio,

anywhere. MBA’s premier marketing platform will give your hotel national and

international attention. We provide targeted exposure to our complete database of

hotel investors and network of industry professionals to drive maximum value for your

hospitality assets. With this national exposure to the hospitality industry, MBA also

insures a level of privacy and confidentiality not provided by other firms. Online users

must login to www.MBAHotels.com, providing their personal information and a record

of their visit, before viewing any detailed information on any property. MBA Hotel

Brokers also collects confidentiality agreements from potential buyers before sharing

our Offering Memorandum which includes the property address and financial

highlights.

Contact Us Today About Selling Your Hotels: [email protected]

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