Lobby w/ Grand Ballroom and Rose Room
Spa Level (second floor)
Includes a Museum
dedicated to the rich
history of the Baker
Hotel and Mineral
Wells, Texas
Typical Guest Room Floor (floor 3 thru 9)
21 Guest Suites per floor
11th floor Baker Suite and Meeting Space
A fully restored
Baker Suite, two
additional suites and
significant meeting
space with spiral
staircase access to
the tenth floor below
and the Cloud Room
above
The Cloud Room and Roof Top Garden
The spectacular
Cloud Ballroom with
rooftop wine & beer
garden and a
warming kitchen to
serve up to 200
guests
Where are we today and where
is all the money coming from?
The Baker Hotel Capitalization
The Baker Hotel Capitalization
Let’s start by looking at the projected value
of the Baker Hotel post renovation….
The Baker Hotel Capitalization
$30 Million
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
Costs Value Feasible Costs Sources
Mil
lio
ns
The Baker Hotel Capitalization
$30 Million
Possibly up to $40
Million
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
Costs Value Feasible Costs Sources
The Baker Hotel Capitalization
$30 Million
Possibly up to $40
Million
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
Costs Value Feasible Costs Sources
Assumes a $175 per
room average rate
and a 68% occupancy
4 years after
completion
The Baker Hotel Capitalization
$30 Million
Possibly up to $40
Million
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
Costs Value Feasible Costs Sources
$30 to $40 Million
Value
Mil
lio
ns
Based on the $30 million projected valuation let’s look at what an economically feasible cost
and capital structure would be if this were a traditional real estate development
The Baker Hotel Capitalization
$30 Million
Possibly up to $40
Million
$26.6 Million
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
Costs Value Feasible Costs Sources
$30 to $40 Million
Value
Mil
lio
ns
The Baker Hotel Capitalization
$30 Million
Possibly up to $40
Million
$26.6 Million
$10.0 Million
Debt
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
Costs Value Feasible Costs Sources
$30 to $40 Million
Value
Mil
lio
ns
The Baker Hotel Capitalization
$30 Million
Possibly up to $40
Million
$26.6 Million
$10.0 Million
Debt
$13.1 Million
Cash Equity
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
Costs Value Feasible Costs Sources
$30 to $40 Million
Value
Mil
lio
ns
The Baker Hotel Capitalization
$30 Million
Possibly up to $40
Million
$26.6 Million
$10.0 Million
Debt
$13.1 Million
Cash Equity
$3.5 Million Dev. Fees
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
Costs Value Feasible Costs Sources
$30 to $40 Million
Value
Mil
lio
ns
The Baker Hotel Capitalization
$30 Million
Possibly up to $40
Million
$26.6 Million
$10.0 Million
Debt
$13.1 Million
Cash Equity
$3.5 Million Dev. Fees
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
Costs Value Feasible Costs Sources
Entrepreneurial Profit
$30 to $40 Million
Value
Mil
lio
ns
The Baker Hotel Capitalization
$30 Million
Possibly up to $40
Million
$26.6 Million
$10.0 Million
Debt
$13.1 Million
Cash Equity
$3.5 Million Dev. Fees
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
Costs Value Feasible Costs Sources
Entrepreneurial Profit
$30 to $40 Million
Value
“Traditional” Real Estate
Development Transaction
Mil
lio
ns
But the renovation of the Baker Hotel is by no means a “Traditional” Real Estate Development
Transaction
Let’s look at the actual budget required to renovate a 90 year old 14-story hotel that has
been left abandoned for almost 50 years…
The Baker Hotel Capitalization
$30 Million
Possibly up to $40
Million
$26.6 Million
$10.0 Million
Debt
$13.1 Million
Cash Equity
$3.5 Million Dev. Fees
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
Costs Value Feasible Costs Sources
$30 to $40 Million
Value
Mil
lio
ns
The Baker Hotel Capitalization
Building Purchase
$30 Million
Possibly up to $40
Million
$26.6 Million
$10.0 Million
Debt
$13.1 Million
Cash Equity
$3.5 Million Dev. Fees
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
Costs Value Feasible Costs Sources
$30 to $40 Million
Value
Mil
lio
ns
$2.2 Million
The Baker Hotel Capitalization
Building Purchase
Hard Costs
$30 Million
Possibly up to $40
Million
$26.6 Million
$10.0 Million
Debt
$13.1 Million
Cash Equity
$3.5 Million Dev. Fees
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
Costs Value Feasible Costs Sources
$30 to $40 Million
Value
Mil
lio
ns
$33.6 Million
The Baker Hotel Capitalization
Building Purchase
Hard Costs
FF&E
$30 Million
Possibly up to $40
Million
$26.6 Million
$10.0 Million
Debt
$13.1 Million
Cash Equity
$3.5 Million Dev. Fees
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
Costs Value Feasible Costs Sources
$30 to $40 Million
Value
Mil
lio
ns
$7.5 Million
The Baker Hotel Capitalization
Building Purchase
Hard Costs
FF&E
OS&E and Marketing
$30 Million
Possibly up to $40
Million
$26.6 Million
$10.0 Million
Debt
$13.1 Million
Cash Equity
$3.5 Million Dev. Fees
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
Costs Value Feasible Costs Sources
$30 to $40 Million
Value
Mil
lio
ns
$5.6 Million
The Baker Hotel Capitalization
Building Purchase
Hard Costs
FF&E
OS&E and Marketing
Soft Costs
$30 Million
Possibly up to $40
Million
$26.6 Million
$10.0 Million
Debt
$13.1 Million
Cash Equity
$3.5 Million Dev. Fees
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
Costs Value Feasible Costs Sources
$30 to $40 Million
Value
Mil
lio
ns
$8.8 Million
The Baker Hotel Capitalization
Building Purchase
Hard Costs
FF&E
OS&E and Marketing
Soft Costs
Interest Reserve
$30 Million
Possibly up to $40
Million
$26.6 Million
$10.0 Million
Debt
$13.1 Million
Cash Equity
$3.5 Million Dev. Fees
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
Costs Value Feasible Costs Sources
$30 to $40 Million
Value
Mil
lio
ns
$3.5 Million
The Baker Hotel Capitalization
Building Purchase
Hard Costs
FF&E
OS&E and Marketing
Soft Costs
Interest Reserve
$30 Million
Possibly up to $40
Million
$26.6 Million
$10.0 Million
Debt
$13.1 Million
Cash Equity
$3.5 Million Dev. Fees
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
Costs Value Feasible Costs Sources
$61.2 Million Cost $30 to $40 Million
Value
Mil
lio
ns
The Baker Hotel Capitalization
Building Purchase
Hard Costs
FF&E
OS&E and Marketing
Soft Costs
Interest Reserve
$30 Million
Possibly up to $40
Million
$26.6 Million
$10.0 Million
Debt
$13.1 Million
Cash Equity
$3.5 Million Dev. Fees
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
Costs Value Feasible Costs Sources
$61.2 Million Cost
$35 Million
“Economic Gap”
$30 to $40 Million
Value
Mil
lio
ns
So this can be no “Traditional” Real Estate
Development Transaction…
The successful renovation of the Baker
Hotel - with a nearly $35 million Economic
Gap - requires a “public/private
partnership” at every level of
government…
The Baker Hotel Capitalization
Building Purchase
Hard Costs
FF&E
OS&E and Marketing
Soft Costs
Interest Reserve
$30 Million
Possibly up to $40
Million
$26.6 Million
$10.0 Million
Debt
$13.1 Million
Cash Equity
$3.5 Million Dev. Fees
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
Costs Value Feasible Costs Sources
$61.2 Million Cost $30 to $40 Million
Value
Mil
lio
ns
The Baker Hotel Capitalization
Building Purchase
Hard Costs
FF&E
OS&E and Marketing
Soft Costs
Interest Reserve
$30 Million
Possibly up to $40
Million
$26.6 Million
$34.6 Million
in
Incentives Needed
$10.0 Million
Debt
$13.1 Million
Cash Equity
$3.5 Million Dev. Fees
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
Costs Value Feasible Costs Sources
$61.2 Million Cost $30 to $40 Million
Value
Mil
lio
ns
Let’s fill the Gap…
The Baker Hotel Capitalization
Building Purchase
Hard Costs
FF&E
OS&E and Marketing
Soft Costs
Interest Reserve
$30 Million
Possibly up to $40
Million
$26.6 Million
$34.6 Million
in
Incentives Needed
$10.0 Million
Debt
$13.1 Million
Cash Equity
$3.5 Million Dev. Fees
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
Costs Value Feasible Costs Sources
$61.2 Million Cost $30 to $40 Million
Value
?
Mil
lio
ns
The Baker Hotel Capitalization
Building Purchase
Hard Costs
FF&E
OS&E and Marketing
Soft Costs
Interest Reserve
$30 Million
Possibly up to $40
Million
$26.6 Million
$34.6 Million
in
Incentives Needed
$10.0 Million
Debt
$13.1 Million
Cash Equity
$3.5 Million Dev. Fees
$7.3 Million TIF
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
Costs Value Feasible Costs Sources
$61.2 Million Cost $30 to $40 Million
Value
Mil
lio
ns
The Baker Hotel Capitalization
Building Purchase
Hard Costs
FF&E
OS&E and Marketing
Soft Costs
Interest Reserve
$30 Million
Possibly up to $40
Million
$26.6 Million
$34.6 Million
in
Incentives Needed
$10.0 Million
Debt
$13.1 Million
Cash Equity
$3.5 Million Dev. Fees
$7.3 Million TIF
$4.0 Million 4B
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
Costs Value Feasible Costs Sources
$61.2 Million Cost $30 to $40 Million
Value
Mil
lio
ns
The Baker Hotel Capitalization
Building Purchase
Hard Costs
FF&E
OS&E and Marketing
Soft Costs
Interest Reserve
$30 Million
Possibly up to $40
Million
$26.6 Million
$34.6 Million
in
Incentives Needed
$10.0 Million
Debt
$13.1 Million
Cash Equity
$3.5 Million Dev. Fees
$7.3 Million TIF
$4.0 Million 4B
$10.3 Million
State HTC
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
Costs Value Feasible Costs Sources
$61.2 Million Cost $30 to $40 Million
Value
Mil
lio
ns
The Baker Hotel Capitalization
Building Purchase
Hard Costs
FF&E
OS&E and Marketing
Soft Costs
Interest Reserve
$30 Million
Possibly up to $40
Million
$26.6 Million
$34.6 Million
in
Incentives Needed
$10.0 Million
Debt
$13.1 Million
Cash Equity
$3.5 Million Dev. Fees
$7.3 Million TIF
$4.0 Million 4B
$10.3 Million
State HTC
$7.0 Million
Federal HTC
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
Costs Value Feasible Costs Sources
$61.2 Million Cost $30 to $40 Million
Value
Mil
lio
ns
The Baker Hotel Capitalization
Building Purchase
Hard Costs
FF&E
OS&E and Marketing
Soft Costs
Interest Reserve
$30 Million
Possibly up to $40
Million
$26.6 Million
$34.6 Million
in
Incentives Needed
$10.0 Million
Debt
$13.1 Million
Cash Equity
$3.5 Million Dev. Fees
$7.3 Million TIF
$4.0 Million 4B
$10.3 Million
State HTC
$7.0 Million
Federal HTC
$6.0 Million NMTC
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
Costs Value Feasible Costs Sources
$61.2 Million Cost $30 to $40 Million
Value
Mil
lio
ns
The Baker Hotel Capitalization
Building Purchase
Hard Costs
FF&E
OS&E and Marketing
Soft Costs
Interest Reserve
$30 Million
Possibly up to $40
Million
$26.6 Million
$34.6 Million
in
Incentives Needed
$10.0 Million
Debt
$13.1 Million
Cash Equity
$3.5 Million Dev. Fees
$7.3 Million TIF
$4.0 Million 4B
$10.3 Million
State HTC
$7.0 Million
Federal HTC
$6.0 Million NMTC
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
Costs Value Feasible Costs Sources
$61.2 Million Cost $30 to $40 Million
Value
$61.2 Million
Capital Stack
Mil
lio
ns
The Baker Hotel Capitalization
Building Purchase
Hard Costs
FF&E
OS&E and Marketing
Soft Costs
Interest Reserve
$30 Million
Possibly up to $40
Million
$26.6 Million
$34.6 Million
in
Incentives Needed
$10.0 Million
Debt
$13.1 Million
Cash Equity
$3.5 Million Dev. Fees
$7.3 Million TIF
$4.0 Million 4B
$10.3 Million
State HTC
$7.0 Million
Federal HTC
$6.0 Million NMTC
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
Costs Value Feasible Costs Sources
$61.2 Million Cost $30 to $40 Million
Value
$61.2 Million
Capital Stack
Mil
lio
ns
Questions?
Questions?