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

More documents

Recommendations

Info

The Westin Denver International AirportHotel Market AnalysisThe ADR of the Denver lodging market fluctuated between approximately $65 and$75 between 1995 and 2004. Beginning in 2005, management of hotels throughoutthe region focused on increasing rates as demand returned to the local market.This focus on increasing ADR resulted in rate growth of 8.4 percent in 2005 withADR increasing from approximately $75 to $81. Significant rate growth of 11.0,10.4, and 6.5 percent was achieved in 2006, 2007, and 2008, respectively, whichresulted in an ADR of approximately $106 in 2008. As demand declined year-overyeardue to the recent economic downturn, management discounted rates, whichresulted in a decrease in ADR of 12.0 percent in 2009. As demand returned to thelocal lodging market, modest increases in ADR were achieved in 2010 and 2011,resulting in an ADR of approximately $98 through year-end 2011. As the economycontinues to improve and demand returns to the Denver lodging market, rate growthof between approximately 4.0 and 7.0 percent is projected over the next five years,resulting in an ADR of approximately $127 in 2016. This ADR growth is deemedreasonable as the market operates on a stabilized level and management focusesprimarily on increasing room rates.D. COMPETITIVE LODGING MARKET ANALYSISWithin the greater Denver lodging market, the proposed Subject is projected tocompete primarily with the nationally-affiliated, full-service and some focus-servicehotels located proximate to the Denver International Airport (DIA) (in theAirport/East submarket). As the Subject will represent the highest quality hotel inthe Airport/East submarket, it is also projected to compete secondarily with thenationally-affiliated, full-service hotels located in downtown Denver (CentralBusiness District submarket). Accordingly, we have presented an overview of themost direct competitors located in the local Airport/East market as well as thesecondary competitors located in the Central Business District lodging market.Lastly, as the Subject will represent an in-terminal hotel, or hotel physicallyconnected to a major international airport, we have also presented an overview ofthe performance of the in-terminal lodging market within the United States andCanada. Our review of the other in-terminal hotels is presented later in this sectionand serves more as a test of reasonableness against the unique performance forthe select number of hotels that are physically connected to a major, internationalairport.1. Competitive Airport Lodging MarketThe airport lodging market primarily includes those hotels located on Tower Road,approximately eight miles southwest of DIA and the group of hotels located in andaround Gateway Park along 40 th Street, approximately 12 miles southwest of DIA.For the purpose of this analysis, we have focused on six hotels in these twolocations as representing the primary competitive market for the proposed Westin.Competitive properties were identified on the basis of product quality, room rateIV-5
The Westin Denver International AirportHotel Market Analysisstructure, amenities offered, and overall market positioning. These hotels includethe Marriott Gateway, Embassy Suites, Hilton Garden Inn, Courtyard by Marriott,Crowne Plaza, and the Holiday Inn. It should be noted that while we have selectedthese six hotels as the primary airport competitors, the proposed Westin maycompete indirectly with many other hotels in the airport market for select segmentsof transient or group demand. However, our selection of these six propertiesrepresents the most competitive sample of hotels in the airport market. Thefollowing table provides a brief summary of these competitive airport properties. Amap and additional information on each individual property is presented on thefollowing pages.The Westin Denver International AirportSummary of the Competitive Airport Lodging MarketProperty Rooms Year OpenDenver International Airport Marriott at Gateway Park 238 1998Embassy Suites Denver International Airport 174 2002Hilton Garden Inn Denver International Airport 157 1999Courtyard Denver International Airport 202 1997Crowne Plaza Denver International Airport 255 1982Holiday Inn Denver International Airport 161 2009Total 1,187 -IV-6
Page 2 and 3:
September 18, 2012Mr. Patrick HeckD
Page 4 and 5:
The Westin Denver International Air
Page 6 and 7:
Page 8 and 9:
SECTION IEXECUTIVE SUMMARY
Page 10 and 11:
Page 12 and 13:
Page 14 and 15:
Page 16 and 17:
Page 18 and 19:
Page 20 and 21:
Page 22 and 23:
Page 24 and 25: The Westin Denver International Air
Page 32 and 33: SECTION IIIPROPERTY DESCRIPTION
Page 34 and 35: The Westin Denver International Hot
Page 112 and 113: SECTION VSTATEMENT OF ESTIMATED ANN
Page 124 and 125:
Page 126 and 127:
Page 128 and 129:
Page 130 and 131:
Page 132 and 133:
Page 134 and 135:
Page 136 and 137:
Page 138 and 139:
Page 140 and 141:
Page 142 and 143:
ADDENDA
Page 144 and 145:
ADDENDUM ACERTIFICATION OF THE CONS
Page 146 and 147:
PKF Consulting appreciates the oppo
Page 148 and 149:
STATEMENT OF ASSUMPTIONS AND LIMITI
Page 150 and 151:
ADDENDUM CQUALIFICATIONS OF THE CON
Page 152 and 153:
QUALIFICATIONS OFCHRISTOPHER A. KRA
Page 154 and 155:
QUALIFICATIONS OFCATHERINE E. BOLST
Page 156 and 157:
Appraisal for the Yountville Inn lo
Page 158 and 159:
Sent via email to: patrick.heck@fly
Page 160 and 161:
Mr. Patrick HeckJune 14, 2012Housto
Page 162 and 163:
Mr. Patrick HeckJune 14, 2012In ord
Page 164 and 165:
Mr. Patrick HeckJune 14, 20127. Mar
Page 167 and 168:
ADDENDUM ESENSITIVITY ANALYSIS
Page 169 and 170:
Page 171 and 172:
show all

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

Create successful ePaper yourself

Delete template?

Save as template?