PKF Hotel Market Demand and Financial Analysis - DIA Business ...

The Westin Denver International AirportStatement of Estimated Annual Operating ResultsFee Basedon 500RoomsManagement Fees Per the Qualified Management AgreementBase Management FeeSubordinate Management FeeFee Basedon 519RoomsFee Basedon 500RoomsFee Basedon 519RoomsPerFeesPerFeesYearRoom(Rounded)Room(Rounded)2015 $659,257 $1,319 $684,309 $285,000 $0 $0 $0 $02016 $759,267 $1,519 $788,119 $728,000 $189,817 $380 $197,030 $82,0002017 $1,271,429 $2,543 $1,319,743 $1,010,000 $211,905 $424 $219,957 $207,0002018 $1,305,994 $2,612 $1,355,622 $1,335,000 $435,331 $871 $451,874 $317,0002019 $1,348,496 $2,697 $1,399,739 $1,374,000 $449,499 $899 $466,580 $458,0002020 $1,387,371 $2,775 $1,440,091 $1,417,000 $462,457 $925 $480,030 $472,0002021 $1,434,654 $2,869 $1,489,171 $1,461,000 $478,218 $956 $496,390 $487,0002022 $1,470,496 $2,941 $1,526,375 $1,505,000 $490,165 $980 $508,791 $502,0002023 $1,514,773 $3,030 $1,572,334 $1,546,000 $504,924 $1,010 $524,111 $515,0002024 $1,559,527 $3,119 $1,618,789 $1,592,000 $519,842 $1,040 $539,596 $531,000In total, management fees are stated at 3.7 percent of total revenues, within thetypical range of total management fees for an asset such as the proposed Subject.b. Real Estate and Property TaxesBased on our conversations with the representatives of the Denver InternationalAirport, as the Subject will be owned by a government agency, it will not be requiredto pay property taxes. As such, we have not modeled a property tax expense intoour projections.c. InsuranceInsurance expense at the proposed Subject is for both general liability and propertycoverage. Presented in the following table are the insurance expenses of thecomparable hotels.V-19