DAYS INN & SUITES YOUNGSTOWN/GIRARD · 2019. 6. 11. · Competitor Data MARKET OVERVIEW 05 Market Analysis ... TVs, and desks with ergonomic chairs. Other amenities include microwaves,

1615 E Liberty St • Girard, OH 44420

Offering Memorandum

1

DAYS INN & SUITES YOUNGSTOWN/GIRARD

N O N - E N D O R S E M E N T A N D D I S C L A I M E R N O T I C E

Confidentiality and 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. © 2018 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 corporation of Marcus & Millichap, its affiliates or subsidiaries, or any agent, product, service, or

commercial listing of Marcus & Millichap, and is solely included for the purpose of providing tenant lessee information about this listing to prospective customers.

ALL PROPERTY SHOWINGS ARE BY APPOINTMENT ONLY.

PLEASE CONSULT YOUR MARCUS & MILLICHAP AGENT FOR MORE DETAILS.


Girard, OH

ACT ID Y0300456

BOR:

Michael Glass

230 West St., Suite 100,

Columbus, OH 43215

TEL: 614-360-98

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TABLE OF CONTENTS

SECTION

INVESTMENT OVERVIEW 01Offering Summary

Regional Map

Local Map

Aerial Photo

Parcel Map

FINANCIAL ANALYSIS 02STR

Historical P&L

5 Year Pro Forma

Acquisition Financing

MARKET COMPARABLES 03Sales Comparables

MARKET COMPETITORS 04

Competitive Set Performance

Competitor Data

MARKET OVERVIEW 05Market Analysis

Demographic Analysis


3


4

INVESTMENT

OVERVIEW


#

EXECUTIVE SUMMARY

OFFERING SUMMARY

MAJOR EMPLOYERS

EMPLOYER # OF EMPLOYEES

St Elizabeth Health Center 2,500

Youngstown State University 853

Northside Medical Center 798

William F Maag Jr Library 521

NationaLease 460

Northeast Ohio Corrections 450

Board Mhning Cnty Cmmissioners 400

Exal Corporation 385

Westview Apartments Ohio LLC 385

Mahoning County 384

US Post Office 333

Brentwood Originals Inc 330

DEMOGRAPHICS

1-Miles 3-Miles 5-Miles

2017 Estimate Pop 3,155 33,832 87,901

2017 Census Pop 3,203 34,592 89,610

2017 Estimate HH 1,276 13,306 35,299

2017 Census HH 1,315 13,795 36,428

Median HH Income $42,114 $37,034 $34,800

Per Capita Income $21,904 $20,884 $20,294

Average HH Income $53,756 $51,576 $48,606

5

VITAL DATA

CURRENT YEAR 1

Price $2,350,000 CAP Rate 13.32% 13.1%

PIP $0 Net Operating Income $321,113 $307,768

Down Payment 20% / $470,000 Net Cash Flow After Debt Service 40.54% / $190,538 37.70% / $177,193

Loan Amount $1,928,000 Total Return 49.44% / $232,345 46.60% / $218,999

Loan Type Proposed New

Interest Rate / Amortization 4.65% / 25 Years

Price/Room $44,340

Ownership Type Fee Simple

Number of Rooms 53

Rentable Square Feet 25,658

Number of Buildings 1

Number of Stories 2

Year Built 1978

Lot Size 2 acre(s)

DAYS INN & SUITES GIRARD

OFFERING SUMMARY

▪ 53 Rooms

▪ Highly Visible Location - Directly off Interstate (I-80)

▪ Renovated In 2014

▪ One Hour from Pittsburg and Cleveland

▪ 4 Miles North of Downtown Youngstown

▪ Owners Apartment - Two Floors, Two Living Spaces, Two Kitchens, Three Bed

Rooms, Two Full Baths, and Patio Area

INVESTMENT HIGHLIGHTS

Marcus & Millichap is pleased to present an opportunity to acquire a newly renovated Days Inn & Suites less than 4 miles from Youngstown State University and less than 5

miles from Covelli Center & Downtown Youngstown.

The subject property is one hour from Cleveland, Ohio and Pittsburgh, Pennsylvania. The Days Inn & Suites Youngstown/Girard Ohio has an occupancy of 58.2 percent,

ADR of $56.84, and a RevPAR of $33.09 The hotel currently operates at 42.94 percent margins which is a net operating income $289,878

We expect ADR and occupancy to rise since the main exit on I-80; exit 229 was closed down for construction and re-opened in the middle of 2017. The numbers for 2016-

2017 were lower as expected, but are now normalizing and predicted to generate close to $700,000.00 - $750,000.00 in room revenues, 60 percent Occ, $59 ADR and a net

operating income ranging from $290,000 - $300,000.00. The Days Inn & Suites Youngstown presents investors an opportunity to acquire a Limited Service product

surrounded by multiple demand generators, significant upside potential through hands on management and the ability to achieve a 20 percent five year return.

All rooms and suites include en-suite bathrooms with showers and tubs, free Wi-Fi, TVs, and desks with ergonomic chairs. Other amenities include microwaves, mini-fridges,

and tea and coffeemakers. Whirlpool tub suites are available. Also currently includes a continental breakfast buffet as well as parking for cars, trucks and buses.

There is a heated indoor pool, hot tub, fitness center, and business centers with meeting rooms available.

The subject property also has an owners apartment which consists of two floors, two living rooms, two full kitchens, three bed rooms, two full baths,, and patio area..

INVESTMENT OVERVIEW

6


#

OFFERING SUMMARY

PROPERTY OVERVIEW

All rooms and suites include en-suite bathrooms with showers and tubs, free Wi-Fi, TVs, and desks with

ergonomic chairs. Other amenities include microwaves, mini-fridges, and tea and coffeemakers. Whirlpool tub

suites are available. Also currently includes a continental breakfast buffet as well as parking for cars, trucks and

buses. In 2019 all rooms received brand new mattresses, bedspreads, & bed sheets. Features brand new

water heaters in 2019 as well.

There is a heated indoor pool, hot tub, and fitness and business centers with meeting rooms available.

The subject property also has an owners apartment which consists of two floors, two living rooms, two full

kitchens, three bed rooms, two full baths, and patio area.

The Seller has owned this hotel for 25 years, it was a former Econo Lodge, and in 2007 they converted it into a

Days Inn & Suites by Wyndham.

***Main reason current owner is selling is due to the fact that they now live in Eastern Pennsylvania.***

7

▪ Indoor Heated Pool

▪ Complimentary Breakfast

Common Area Amenities

▪ Complimentary Wireless Internet Connection

▪ Business Center & Meeting Rooms

▪ Fitness Center

▪ Desk & Ergonomic Chairs

Guest Room Amenities

▪ New Mattresses & Bedspreads-Sheets

▪ Coffee/Tea Maker

▪ Television & Direct Dial Phone

▪ Mini-Refrigerator & Microwave

7

PROPERTY OVERVIEW


The Days Inn & Suites Youngstown is located off of Interstate 80 the most traveled US interstate with business from a wide range of demand generators from large corporations

to leisure travel attractions.

The hotel is only 5 mile from one of the area’s top employers InfoCision. One of the premier companies in direct marketing services, InfoCision employs 1500 area residents

through their main campus. Other major area employers include AT&T, Delphi Packard, General Electric, General Motors Lordstown Plant, and Youngstown State University.

Area leisure attractions are anchored by all Ohio’s Mahoning Valley has to offer. The area is home to the Covelli Center, Hollywood Gaming Racino, Eastwood Mall, Southern

Park Mall, and The Butler Institute of American Art with many more attractions just a short drive away in Pennsylvania .

LOCATION OVERVIEW

8

PROPERTY OVERVIEW


9

OFFERING SUMMARY


10

PROPERTY SUMMARY

THE OFFERING

Property Days Inn & Suites Youngstown/Girard

Price $2,350,000

Property Address 1615 E Liberty St, Girard, OH

Assessors Parcel Number 12-598854

Zoning Commercial - Hotel/Motel

SITE DESCRIPTION

Number of Rooms 53

ADA Rooms 2

Number of Stories 2

Year Built/Renovated 1978 / 2014

Ownership Type Fee Simple

Lot Size 2 acre(s)

Parking 70

Location Highway Exit

CONSTRUCTION

Foundation Concrete

Framing Brick

Exterior Stucco

Parking Surface Asphalt

Roof Shingle/Pitched

MECHANICAL

HVAC Individual PTAC

Elevators NO

CHANGE TO FRANCHISE

Application Fee $35,000.00

Parent Company Wyndham Hotel Group

ROOM TYPES

NUMBER OF ROOMS ROOM TYPE

26 Double

16 Queen

9 King

2 ADA Compliant

PROPOSED FINANCING

FIRST TRUST DEED

Loan Amount $1,928,000

Loan Type Proposed New

Interest Rate 4.65%

Amortization 25 Years

Loan Term 10 Years

Loan to Value 82%

Debt Coverage Ratio 2.46

SECOND TRUST DEED

Loan Type All Cash

REGIONAL MAP


11

LOCAL MAP


12

AERIAL PHOTO


13

Marcus & Millichap closes

more transactions than any other

brokerage firm.

12


14

PROPERTY PHOTO

PARCEL MAP


15


16

FINANCIAL

ANALYSIS

FINANCIAL ANALYSIS


STR

17

FINANCIAL ANALYSIS


HISTORICAL P&L

18

FINANCIAL ANALYSIS


HISTORICAL P&L

19

FINANCIAL ANALYSIS


5 YEAR PRO FORMA

20

FINANCIAL ANALYSIS


5 YEAR PRO FORMA

21

FINANCIAL ANALYSIS


5 YEAR RETURN

22

MARCUS & MILLICHAP CAPITAL CORPORATION

CAPABILITIES

MMCC—our fully integrated, dedicated financing arm—is committed to providing

superior capital market expertise, precisely managed execution, and unparalleled

access to capital sources providing the most competitive rates and terms.

We leverage our prominent capital market relationships with commercial banks,

life insurance companies, CMBS, private and public debt/equity funds, Fannie Mae,

Freddie Mac and HUD to provide our clients with the greatest range of

financing options.

Our dedicated, knowledgeable experts understand the challenges of financing

and work tirelessly to resolve all potential issues to the benefit of our clients.

National platform

operating

within the firm’s

brokerage offices

$5.1 billion total

national

volume in 2016

Access to more

capital sources

than any other

firm in the

industry

Optimum financing solutions to

enhance value

Our ability to enhance buyer

pool by expanding finance

options

Our ability to enhance

seller control

• Through buyer

qualification support

• Our ability to manage buyers

finance expectations

• Ability to monitor and

manage buyer/lender progress,

insuring timely,

predictable closings

• By relying on a world class

set of debt/equity sources

and presenting a tightly

underwritten credit file

WHY MMCC?

Closed 1,651

debt and equity

financings

in 2016

ACQUISITION FINANCING


23


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MARKET

COMPARABLES

PROPERTY NAMEDAYS INN & SUITES YOUNGSTOWN/GIRARD

SALES COMPARABLES

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SALES COMPARABLES

Avg. .00

0.00

0.50

1.00

1.50

2.00

2.50

3.00

3.50

4.00

4.50

5.00

Average RRM

Avg. $55.59

$0.00

$7.50

$15.00

$22.50

$30.00

$37.50

$45.00

$52.50

$60.00

$67.50

$75.00

Average RevPAR

Avg. $53,521

$0

$9,000

$18,000

$27,000

$36,000

$45,000

$54,000

$63,000

$72,000

$81,000

$90,000

Average Price Per Room

Avg. 10.38%

0

1

3

4

5

7

8

9

10

12

13

Average Cap Rate

PROPERTY NAME

MARKETING TEAM


SALES COMPARABLES

rentpropertyname1

rentpropertyaddress1

rentpropertyname1


rentpropertyname1


26

1

Close of Escrow 5/22/2017

Asking Price $4,055,000

Price/Room $61,439

Price/SF $279.67

CAP Rate 10.92%

Total No. of Rooms 66

Year Built / Renovated 2001

Underwriting Criteria

Occupancy 61%

ADR $101.89

Rev PAR $62

HAMPTON INN4400 Belmont Ave, Youngstown, OH, 44505



Price/Room $82,215

CAP Rate 10.24%


Year Built / Renovated 2002 / 2015


Occupancy 61%

ADR $108.92

Rev PAR $66

2

HAMPTION INN COLUMBUS2093 South Hamilton Road, Columbus, OH, 43232

PROPERTY NAME

MARKETING TEAM


SALES COMPARABLES

rentpropertyname1


rentpropertyname1


rentpropertyname1


27



Price/Room $33,073

Price/SF $24.22

CAP Rate 11.04%




Occupancy 62%

ADR $61.72

Rev PAR $38

3

HAWTHORN SUITES TOLEDO6101 Trust Dr, Holland, OH, 43528

4



Price/Room $33,500

CAP Rate 10.73%




Occupancy 55%

ADR $71.12

Rev PAR $39

BEST WESTERN PLUS UNIVERSITY 2117 Marion Mount Gilead Road, Marion, OH, 43302



Price/Room $57,377

CAP Rate 8.96%




Occupancy 72%

ADR $101.41

Rev PAR $73

5

HOLIDAY INN EXPRESS7301 State Rte 37, Sunbury, OH, 43074


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MARKET

COMPETITORS


$55.00

$56.00

$57.00

$58.00

$59.00

$60.00

$61.00

$62.00

Prior Year 3 Prior Year 2 Prior Year 1

ADR Comparison

Hotel/Motel Comp Set

$0.00

$5.00

$10.00

$15.00

$20.00

$25.00

$30.00

$35.00

$40.00


RevPAR Comparison


COMPETITORS

COMPETITIVE SET PERFORMANCE

The table below summarizes the occupancy, ADR, and RevPAR for the Days Inn & Suites Youngstown/Girard and its defined

competitive set for the Prior Year 3 - Prior Year 1 periods.

Source: Smith Travel Research

OCCUPANCY, ADR & RevPAR

Days Inn & Suites Youngstown/Girard

Occupancy ADR RevPAR

Year Hotel/Motel Comp Set Penet. Hotel/Motel Comp Set Penet Hotel/Motel Comp Set Penet

Prior Year 3 58.8% 47.1% 125.0% $59.06 $61.32 96.0% $34.73 $28.88 120.0%

Prior Year 2 50.7% 43.2% 117.0% $60.06 $59.93 100.0% $30.45 $25.89 118.0%

Prior Year 1 43.7% 40.4% 108.0% $60.18 $57.11 105.0% $26.30 $23.07 114.0%

% Change -13.8% -6.5% -13.6% 0.2% -4.7% 9.4% -13.6% -10.9% -5.0%

0.00%

10.00%

20.00%

30.00%

40.00%

50.00%

60.00%

70.00%


Occupancy Comparison



Hotel/Motel 58.8% 50.7% 43.7%

Comp Set 47.1% 43.2% 40.4%

Index 125.0% 117.0% 108.0%


Hotel/Motel $59.06 $60.06 $60.18

Comp Set $61.32 $59.93 $57.11

Index 96.0% 100.0% 105.0%


Hotel/Motel $34.73 $30.45 $26.30

Comp Set $28.88 $25.89 $23.07

Index 120.0% 118.0% 114.0%

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30

MARKET

OVERVIEW

MARKET OVERVIEW

OVERVIEW

YOUNGSTOWN

FAMILY FRIENDLYA desirable quality of life attracts many families. Draws include Youngstown’s

collection of four- and five-star schools.

ACHIEVABLE HOMEOWNERSHIPThe metro’s affordable cost of living and low home prices allow 71 percent of

households to own a home, well above the U.S. rate.

GROWING CONCENTRATION OF MANUFACTURERSMatalco, Joseph Co. and other out-of-state manufacturers have recently

secured incentives to construct facilities in the metro.

The Youngstown metro is situated in the Mahoning Valley, spanning

portions of western Ohio and eastern Pennsylvania. The metro consists

of Mahoning, Trumbull and Mercer counties. The city of Youngstown is

the metro’s largest municipality and a midpoint between Cleveland and

Pittsburgh. Youngstown and the city of Warren account for a combined

107,000 citizens.

▪ The metro boasts a diverse employment base driven by the education, healthcare and manufacturing

sectors. Youngstown State University is one of the metro’s largest employers.

▪ Other major employers represent a variety of industries and include Joseph Company International,

which is constructing a beverage and technology complex in Youngstown that will produce the

world’s first self-chilling beverage. Canadian-based manufacturer Matalco recently opened an

aluminum re-melt factory in the village of Lordstown.

▪ Construction on the $900 million Lordstown Energy Center is nearing completion and a second $900

million gas-fired power plant is planned nearby.

DEMOGRAPHICS

1

ECONOMY

METRO HIGHLIGHTS

* Forecast

Sources: Marcus & Millichap Research Services; BLS; Bureau of Economic Analysis; Experian; Fortune; Moody’s Analytics; U.S. Census Bureau


2017POPULATION:

224K

2017HOUSEHOLDS:

43.8

2017MEDIAN AGE:

$44,100

2017 MEDIAN HOUSEHOLD INCOME:

U.S. Median:

378U.S. Median:

$56,3000.2%

Growth2017-2022*:

-0.8%

Growth2017-2022*:

554K

MARKET OVERVIEW


32

NORTH CENTRAL

Healthy Performance Gains Attract Investors to North Central Region

Business and sports support rising occupancy. Steady increases in room nights have driven occupancy and revenue metric improvements in the North Central region,

which comprises Indiana, Ohio and Michigan. In Indiana, a growing tech sector is underpinning business travel demand. As several firms expand and move to the state,

hotel occupancy, particularly during the workweek, may continue to rise from travel to interviews and business meetings. Occupancy in all three states will benefit from the

start of the collegiate school year in the fall. Travel to sporting events, particularly against rivalry teams, may support further occupancy improvement by year end.

Deal flow picks up regionally. Improving occupancy and steady growth in ADR and RevPAR during the year ending in June have heightened investor demand for hotel

properties in the North Central region. Assets in Ohio and Indiana made up the bulk of sales, with Cincinnati and Indianapolis garnering particular investor interest.

Regionally, economy and upper midscale hotel assets comprised the majority of transactions, though sales of upscale properties rose this time as several Hilton branded

properties traded.

MARKET OVERVIEW


33

NORTH CENTRAL

▪ Occupancy climbs regionally. Room nights of 3.9 percent outpaced the 1.3 percent increase in rooms

available during the prior 12 months, lifting occupancy in the North Central region 170 basis points to 71.8

percent in June. All states contributed to occupancy improvement during this time, with Indiana and Ohio

outperforming the region. In Ohio, occupancy jumped 200 basis points since last June to 72.0 percent as

room nights rose 4.3 percent. This increase could be attributed to the Republican National Convention

held last year. Occupancy in Indiana climbed 210 basis points to 73.4 percent, the highest rate among all

three states. Room nights in Indiana advanced 3.3 percent during the last four quarters as rooms

available ticked up marginally. Indianapolis registered a 60-basis-point increase during this time to 77.1

percent as few rooms were delivered during the last 12 months.

▪ Revenue metrics moderate. Improving regional occupancy drove increases in revenue metrics during the

last four quarters, though at a slower pace than last year. ADR in the North Central region rose 2.2

percent to $103.32 ending in the second quarter while RevPAR climbed 4.8 percent during this time.

Michigan posted the strongest ADR growth, moving up 3.6 percent to $79.69. The increase in ADR,

coupled with a 100-basis-point rise in occupancy, lifted RevPAR in the state up 4.8 percent. In Indiana,

ADR and RevPAR rose 3.4 percent and 6.5 percent, respectively. Revenue metrics in Cleveland

registered losses, slowing improvement for the state of Ohio, where ADR inched up 0.5 percent. The jump

in statewide occupancy did aid in a 3.4 percent increase in RevPAR.

▪ Bidding heats up for region’s hotels. Transaction velocity in the North Central region rose considerably as

demand for hotel properties picked up significantly in Ohio and Indiana. Increased demand for regional

hotel assets also drove up the average price roughly 4 percent during the last four quarters to $43,000 per

room. Hotels in Indiana changed hands near $57,600 per key on average.

* Forecast

MARKET OVERVIEW


34

HOSPITALITY RESEARCH

Investors Maintain Confidence in Hospitality Market

As Occupancy and Revenue Metrics Improve

Hotel room demand persists. The U.S. hospitality sector has recorded increases in occupancy and revenue

metrics during the year ending in June as room demand remained healthy. Employment growth nationwide and the

rising median household income will support travel in the near future. Both domestic and international travel

continue to rise, further benefiting room demand. Potential headwinds do exist including the growing construction

pipelines in many major markets that may place downward pressure on occupancy, the average daily rate and

RevPAR this year and into 2018.

• During the last 12-month period, hiring in office-using sectors rose 2.4 percent nationwide as 734,000 workers

were added to staffs. Healthy job growth and a tight employment rate of 4.4 percent bolstered medium

household incomes by 2.8 percent during this time. The rising incomes may spur additional leisure travel while

increased jobs may further business travel.

• Domestic and international passenger travel in the United States rose 3.8 percent during 2016. In particular,

international travel provides hotel operators opportunities for stronger demand drivers as passengers more than

doubled in the last three years.

• Texas and California have more than 20,000 rooms each that are expected to break ground in the next 12

months. The increased supply may place downward pressure on occupancy in the coming years.

MIDYEAR 2017

MARKET OVERVIEW


35


Investors increasingly targeting hotels as demand drivers improve. Hotel operations that spur revenue growth have

kept buyers active in this sector. Transaction velocity rose roughly 10 percent nationwide as demand picked up for

properties in many of the country’s smaller markets. On average, hotel assets changed hands for nearly $100,000

per key, down slightly year over year as fewer properties in upper chain scales changed hands.

▪ Among chain scales, lower-tier hotels garnered significant investor attention. Trades increased considerably for

economy and upper midscale assets during the previous four quarters. Demand for upscale assets held steady

with the majority of trades in Marriott and Hilton branded properties.

▪ Several regions posted significant increases in transaction volume during the last 12 months. The Carolinas and

the Central Midwest region led the nation, with the Mid Atlantic, Mid South and Southwest regions following. In

prior years, coastal regions typically led sales volume.

▪ Sales velocity picked up for independent properties during the year ending in June as buyers widened their

acquisition expectations. The increased demand for soft brand hotels may further intensify bidding for their

properties moving forward as visitors seek experience oriented hotels.

MIDYEAR 2017

MARKET OVERVIEW


36

Hotel construction pipeline on the rise. Roughly 111,000 rooms in more than 950 hotel projects were completed

nationwide during the last 12 months up to June. Moving forward, nearly 187,000 rooms are under development

and an additional 222,000 are expected to break ground in the next four quarters. The growing supply additions

may place downward pressure in occupancy over the coming year.

▪ The metros of Houston and New York City received the largest number of rooms as 4,200 and 5,400 rooms

were completed within July to June, respectively.

▪ Hilton Worldwide and Marriott International boosted their inventory during the last 12 months. Both companies

averaged between 27 percent and 28 percent increases of new hotel rooms over all supply additions.

▪ Among chain scales, the bulk of new completions were in the upscale and upper midscale segments with a

combined total of 77,000 rooms. Roughly 10,500 unaffiliated rooms were also constructed during this time.* Trailing 12 months through 2Q

MIDYEAR 2017

MARKET OVERVIEW


37

Occupancy climbs amid healthy room demand. Since last June, demand for hotel rooms continued to outpace

supply growth, lifting occupancy in the United States 50 basis points to 73.4 percent at the end of the second

quarter. First half occupancy rose 40 basis points from the same time period last year to 65.3 percent.

▪ Large markets that demonstrated significant occupancy increases from last year include Norfolk-Virginia Beach,

Orlando and Atlanta. On the other hand, mounting supply pressures in metros including Dallas, Houston and

Nashville weighed on vacancy improvement in the last 12 months.

▪ Nearly all hotel chain scales posted occupancy improvements over the year ending in June. Economy chains

boasted the greatest improvement with occupancy increasing 90 basis points to 65.4 percent. The upscale

segment posted the only occupancy decrease as the rate ticked down 20 basis points year over year to 80.5

percent.

▪ Based on location, occupancy in properties in proximity to major thoroughfares climbed 100 basis points during

the previous four quarters to 66.6 percent. Room demand in these hotels typically comes from travelers passing

by. The highest occupancy rate remains in urban hotels at 80.4 percent, up 50 basis points year over year.

MIDYEAR 2017

MARKET OVERVIEW


38

Room demand drives increases in revenue metrics. Rising occupancy nationwide is driving growth in revenue

metrics. During the year ending in the second quarter, the average daily rate advanced 2.1 percent to $129.12. The

increase in ADR and occupancy generated a 2.8 percent rise in RevPAR during this time to $94.73.

▪ ADR and RevPAR in independent hotels outperformed all other chain scales, rising 2.7 percent and 3.9

percent, respectively. Economy hotels followed as strong occupancy improvement and a 2.2 percent increase

in ADR drove a 3.5 percent climb in RevPAR during the last 12 months.

▪ Despite higher occupancy in urban areas, suburban hotels outperformed their counterparts in ADR and

RevPAR growth during the previous four quarters. ADR in urban hotels rose 0.3 percent while RevPAR inched

up 0.9 percent during this time. In the suburbs, ADR climbed 2.3 percent and RevPAR posted a 2.8 percent

advance.

▪ Major markets with RevPAR growth near or above 10 percent include Norfolk-Virginia Beach, Orlando, and San

Diego.

MIDYEAR 2017

* Trailing 12 months through 2Q

MARKET OVERVIEW


39

Total Airport Passengers in Major Markets

MIDYEAR 2017

2016 International Visitation

▪ Passenger travel in the many of the nation’s largest

airports can highlight up-and-coming travel destinations

and the potential for improvement in hotel occupancy

and revenue metrics. The Los Angeles International

Airport registered an 8 percent increase in passenger

volume in 2016 from the prior year, making it the second

most traveled airport in the nation. During this same

time, hotel occupancy increased 100 basis points in the

Los Angeles metro while RevPAR jumped 10.9 percent

year over year. Additionally, hotels located near airports

tend to have some of the highest occupancy rates,

compared with interstate, resort, suburban and small

metro hotels.

▪ One of U.S. largest contributors to international

visitation, Brazil, was battered with political turmoil and a

recession leading to a 24 percent drop in arrivals in

2016. Many Florida markets are impacted from fewer

tourists visiting from the country and several of these

metros, including Orlando, registered occupancy

declines last year. On the other hand, the number of

tourists from China grew 15 percent in 2016 from the

prior year and that number is expected to increase. As a

result, many hotels are customizing amenities to entice

these travelers, including a hotel chain in California that

will now accept Chinese mobile payments.

Travel Highlights

MARKET OVERVIEW


40


▪ Monetary policy in transition. Despite the Fed raising its benchmark short-term rate three times in seven months and signaling another rise before the end of the year,

long-term rates have remained stable. The yield on the 10-year U.S. Treasury bond remained in the low- to mid-2 percent range throughout the third quarter of 2017.

The Federal Reserve wants to normalize monetary policy and, in addition to raising its funds (or overnight lending) rate, has announced it will begin to taper its balance

sheet by allowing an initial $10 billion in securities to mature without reinvestment. By reducing its acquisitions of securities, 10-year Treasury rates should drift upward,

thereby widening the spread between short- and long-term rates.

▪ Increase in interest rates over the course of the year, pushing up the cost of capital. While commercial real estate fundamentals remain strong, rising costs associated

with debt financing will tighten the spread between cap rates and lending benchmarks. This environment could weigh on transaction activity as investors evaluate their

yield options. Cap rates have remained relatively stable over the last year, but upward movement in Treasury rates has amplified the expectation gap between buyers

and sellers.

▪ Capital markets remain highly competitive, with a broad assortment of fixed-rate products available. Year to date, CMBS market share has moved from a quarter of the

market up to comprising one-third of hotel lending. Loan-to-value for CMBS typically is in the low-60 percent range. Lending by national and regional/local banks

comprises a quarter of the lending activity this year with smaller loan sizes and LTV averaging from 60 percent to upwards of 90 percent for SBA products.

Capital Markets

MIDYEAR 2017

MARKET OVERVIEW


41


Name State Rooms

Wyndham Garden Hotel Newark NJ 349

Clarion Orlando International Airport FL 330

Surfside Marina TX 281

Clarion Conversion KS 257

Holiday Inn & Suites Beaumont TX 253

Atrium Hotel & Conference Center KS 216

Cabot Lodge Jackson North MS 200

Crowne Plaza OH 200

A2B Budget Hotel GA 196

Fontana Village Resort NC 194

Denver’s Best Inn & Suites CO 190

Ramada Florence Center SC 190

Days Inn Birmingham South AL 159

Red Roof Inn St. Louis Westport MO 158

Holiday Inn & Suites WI 146

Clarion Inn & Suites Syracuse NY 143

Days Inn New Orleans LA 138

The Hotel Blue NM 140

Best Western Plus Westbank LA 138

Roadway Inn FL 125

Suburban Extended Stay South Bend IN 117

Days Inn Knoxville East TN 116

Holiday Inn Yakima WA 114

Motel 6 Tulsa South OK 114

2017 Marcus & Millichap Transactions

MIDYEAR 2017

PROPERTY NAME

MARKETING TEAM


DEMOGRAPHICS

Source: © 2017 Experian

Created on April 2018

POPULATION 1 Miles 3 Miles 5 Miles

▪ 2022 Projection

Total Population 3,091 32,640 84,955

▪ 2017 Estimate


▪ 2010 Census


▪ 2000 Census


▪ Daytime Population

2017 Estimate 5,515 43,108 104,044

HOUSEHOLDS 1 Miles 3 Miles 5 Miles

▪ 2022 Projection

Total Households 1,263 12,943 34,408

▪ 2017 Estimate


Average (Mean) Household Size 2.34 2.34 2.33

▪ 2010 Census


▪ 2000 Census


HOUSING UNITS 1 Miles 3 Miles 5 Miles

▪ Occupied Units

2022 Projection 1,263 12,943 34,408

2017 Estimate 1,488 15,839 41,900

HOUSEHOLDS BY INCOME 1 Miles 3 Miles 5 Miles

▪ 2017 Estimate

$200,000 or More 1.10% 1.47% 1.26%

$150,000 - $199,000 1.36% 1.68% 1.23%

$100,000 - $149,000 11.18% 8.10% 6.77%

$75,000 - $99,999 8.43% 9.79% 9.06%

$50,000 - $74,999 16.57% 16.27% 16.90%

$35,000 - $49,999 17.36% 15.01% 14.53%

$25,000 - $34,999 12.80% 11.99% 12.40%

$15,000 - $24,999 12.30% 14.69% 15.23%

Under $15,000 18.89% 21.00% 22.60%

Average Household Income $53,756 $51,576 $48,606

Median Household Income $42,114 $37,034 $34,800

Per Capita Income $21,904 $20,884 $20,294

POPULATION PROFILE 1 Miles 3 Miles 5 Miles

▪ Population 25+ by Education Level

2017 Estimate Population Age 25+ 2,262 23,562 61,163

Elementary (0-8) 2.18% 2.32% 2.50%

Some High School (9-11) 8.16% 9.60% 10.21%

High School Graduate (12) 44.24% 41.01% 42.63%

Some College (13-15) 19.63% 20.54% 20.69%

Associate Degree Only 6.30% 6.62% 6.47%

Bachelors Degree Only 11.69% 11.34% 10.38%

Graduate Degree 7.55% 7.75% 6.17%

42

Income

In 2017, the median household income for your selected geography is

$42,114, compare this to the US average which is currently $56,286.

The median household income for your area has changed by 22.46%

since 2000. It is estimated that the median household income in your

area will be $47,085 five years from now, which represents a change

of 11.80% from the current year.

The current year per capita income in your area is $21,904, compare

this to the US average, which is $30,982. The current year average

household income in your area is $53,756, compare this to the US

average which is $81,217.

Population

In 2017, the population in your selected geography is 3,155. The

population has changed by -6.24% since 2000. It is estimated that the

population in your area will be 3,091.00 five years from now, which

represents a change of -2.03% from the current year. The current

population is 47.80% male and 52.20% female. The median age of the

population in your area is 44.68, compare this to the US average

which is 37.83. The population density in your area is 1,002.58 people

per square mile.

Households

There are currently 1,276 households in your selected geography. The

number of households has changed by -5.48% since 2000. It is

estimated that the number of households in your area will be 1,263

five years from now, which represents a change of -1.02% from the

current year. The average household size in your area is 2.34

persons.

Employment

In 2017, there are 3,255 employees in your selected area, this is also

known as the daytime population. The 2000 Census revealed that

53.42% of employees are employed in white-collar occupations in this

geography, and 48.01% are employed in blue-collar occupations. In

2017, unemployment in this area is 7.56%. In 2000, the average time

traveled to work was 21.00 minutes.

Race and Ethnicity

The current year racial makeup of your selected area is as follows:

68.88% White, 25.64% Black, 0.00% Native American and 1.07%

Asian/Pacific Islander. Compare these to US averages which are:

70.42% White, 12.85% Black, 0.19% Native American and 5.53%

Asian/Pacific Islander. People of Hispanic origin are counted

independently of race.

People of Hispanic origin make up 3.87% of the current year

population in your selected area. Compare this to the US average of

17.88%.

PROPERTY NAME

MARKETING TEAM


Housing

The median housing value in your area was $113,812 in 2017,

compare this to the US average of $193,953. In 2000, there were 929

owner occupied housing units in your area and there were 421 renter

occupied housing units in your area. The median rent at the time was

$395.

Source: © 2017 Experian

DEMOGRAPHICS

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DEMOGRAPHICS

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Documents

DAYS INN & SUITES YOUNGSTOWN/GIRARD · 2019. 6. 11. · Competitor Data MARKET OVERVIEW 05 Market Analysis ... TVs, and desks with ergonomic chairs. Other amenities include microwaves,