KNIGHTS – RED LION 339 Wasatch Road, Evanston, Wyoming 82930

Disclaimer This Marketing Brochure contains select information pertaining to the Property of the Owner, and does not purport to be all-inclusive or contain all or part of the information which prospective purchaser may require to evaluate a purchase of the property. The information contained in this Marketing Brochure has been obtained from current owner and sources believed to be reliable, but has not been verified for accuracy, completeness, or fitness for any particular purpose. All information is presented “as is” without representation or warranty of any kind. Such information includes estimates based on current and forward-thinking assumptions relating to the general economy, market conditions, competition and other factors which are subject to uncertainty and may not represent the current or future performances of the Property. All references to square footages, and other measurements are approximate. Additional information and opportunity to inspect the Property may be made available to qualified prospective purchaser. You are advised to independently verify the accuracy and completeness of all summaries and information contained herein, to consult with independent legal and financial advisors, and carefully investigate the economics of this transaction and suitability for your investment needs. ANY RELIANCE ON THE CONTENT OF THIS MARKETING BROCHURE IS SOLELY AT YOUR OWN RISK. The Owner expressly reserves the right, at their sole discretion, to reject any or all expressions of interest or offers to purchase the Property, and/or terminate discussions at any time with or without notice to you. All offers, counteroffers, and negotiations shall be non-binding and neither the Owner or appointed representative shall have any legal commitment or obligation except as set forth in a fully executed, definitive purchase and sale agreement delivered by the Owner. ALL PROPERTY SHOWINGS ARE BY APPOINTMENT ONLY. SEE CONTACT INFORMATION.

EXECUTIVE SUMMARY

Property Description Knights Inn – Red Lion The Property is located near the center of downtown Summit Lodging dba Knights Inn, Evanston, Wyoming Evanston providing easy access to shopping and (“Property”) is pleased to offer, for sale, an existing services. The 2.179 Acre site is improved with a three- Select-Service which is ideally positioned in the story, 62,370 square foot interior-corridor hotel with 119 southwest corner of the state of Wyoming nestled in the guestrooms, 2 meeting rooms, commercial laundry, Bear River Valley. The Property is strategically located restaurant and lounge. The Property was constructed in along Wasatch Road with excellent visibility and access circa 1982 and extensively renovated in 2017-2019. from Interstate 80, Exit 3 (Overthrust Rd), Evanston, Wyoming. Investment Opportunity The opportunity to acquire a fully operational Select- Select-Service Hotel Service hotel including: site, building, restaurant and Over the course of the past several years, the stratum lounge, FF&E, software and flag. between limited-service and full-service properties begat a hybrid known as the select-service . Select- Purchase Price ………………………………... $ 4,625,000 Service hotels, as the name suggests, offer the Terms of Sale …………………………………………. Cash fundamentals of limited-service properties together with a selection of the services and amenities characteristic of full-service properties.

AREA DATA: UINTA COUNTY, WYOMING which has been renovated after a recent fire gutted the structure. Now called the Evanston Cultural Center, the theater offers community productions, special events, Across the vast, high desert vistas to the majestic, snow- and soon scheduled to show second-run films and more. capped mountain peaks, and into the quaint, western- The Bear River flowing right through town presents oriented communities that make up south west Wyoming. opportunities for a whole host of activities. Casual visitors and dedicated adventurers alike will find a lot to like in this unique part of the West. Evanston serves as a hub for recreational opportunities and activities in both southwest Wyoming and northeast Uinta County was created on December 1, 1869 by the Utah. Surrounded by mountains on all sides, Evanston legislature of the Wyoming Territory with its temporary is a recreational mecca for fishing, hunting, hiking, seat located at Fort Bridger. Originally, it ran along the mountain biking, wildlife viewing, camping and many entire western border of Wyoming, including Yellowstone other outdoor recreational opportunities. The beautiful National Park. The county was named for Utah's Uinta Uinta Mountains are a short drive of 30 miles south of Mountains, which are visible from many places in the Evanston, Bear River State Park is home to small herd of county. The county was given its present boundaries in Bison and Elk. There are virtually limitless opportunities 1911 when Lincoln County was carved out of the for hunters, fishermen and other outdoor enthusiasts. northern part of Uinta County. As of the 2010 census, the population of Uinta County was 21,025 persons th The summers are perfect for hiking in the Uinta making it 10 largest of the 576,412 population of Mountains along with biking, camping and exploring the Wyoming. Today the county seat of Uinta County is city many emigrant trails. Sulphur Creek Reservoir located of Evanston. south off Highway 150 is popular for fishing, boating and windsurfing. Evanston, Wyoming Evanston is the 8TH largest city in state of Wyoming, Winter brings invigorating wintertime sports such as ice situated in the southwest corner of the state along fishing, snowshoeing, ice skating, sledding, Interstate 80 and the Union Pacific Railroad mainline, snowmobiling, cross country skiing, Yurts and alpine only four (4) miles from the Utah border at an elevation of skiing at world class resorts along the Wasatch Front, 6,780 feet. It is approximately 44 miles east of Park City, including Snowbird, Alta (Little Cottonwood Canyon), Utah, 79 miles southeast of Salt Lake City, Utah, 51 Park City, Snow Basin and Powder Mountain. miles east of Weber, Utah and 78 miles to Ogden, Utah. Economic Characteristics In the assessment of the general economic climate for a select-service hotel in Uinta County (Evanston MSA), particular emphasis was placed on key indicators such as population growth, employment stability, and growth in tourism. In addition, to understand the dynamics of the local market, further analysis of industrial, commercial, retail, and employment patterns for the area are noted.

Population As of the 2010 census the population of Evanston was 12,359 persons, the Micropolitan Statistical Area (MSA) reported a population of 21,066. Evanston alone

represented a growth of 7.4% from the 2000 census, with 4,540 households, and 3,135 families residing in the city. Evanston was originally a railroad town established in The population density was 1,203.4 inhabitants per 1868 and became the county seat in 1870. Evanston has square mile. The median age in the city was 32.7 years. experienced periods of boom and bust throughout its 30% of were 65 years of age or older. The gender history. It was bolstered for many years by being situated residents were under the age of 18; 8.5% were between along the Lincoln Highway, the national auto route that the ages of 18 and 24; 27.3% were from 25 to 44; 25.7% predated the modern Eisenhower Interstate System. The were from 45 to 64; and 8.6% of the city was 50.0% male oil boom lifted the economy in the 1980s, and continued and 50.0% female makeup. diversification of the local industrial base continues to provide employment for area residents. Much work has also been put into restoring historic sites within the city, Demographics including the Union Pacific roundhouse and machine The median household income in Evanston in 2016 was shop, the Hotel Evanston and the Strand Theater $45,313 which is less than the median annual income for

Wyoming of $59,143 and the Nation of $55,322. This is Business Environment attributable to the high percentage of jobs in Historically, Evanston has relied on its business-friendly accommodations and food service and fewer jobs in the environment that supports free enterprise and the oil and gas sector. Unemployment for Evanston was entrepreneurial spirit. Wyoming has the lowest tax noted at 5.2% that is higher than the overall state (3.3%) structure in the nation, accessibility to government and national unemployment rate (4.7%). Between 2015 decisions makers, efficient and effective regulations, and and 2016 the population of Evanston declined from affordable housing. The community is served by 5 banks 12,213 to 12,179 and the median household income and 1 credit union with combined assets of $1.3 billion. declined from $50,604 to $45,313. Community Facilities and Healthcare Employment The community of Evanston is served by 34 churches, 2 Evanston is moderately successful in diversifying its Community Convention Centers, 15 hotels, one economy which for years was dependent on oil and gas Recreational Vehicle Park (56 full hook-ups), 21 exploration. Although oil and gas employment has Municipal & State Parks, and 3 County libraries. The declined, oil and gas industries remain strong with some community has 2 family practice clinics, 9 dental clinics, 6 of the highest paying jobs. In conjunction with this optometrist offices, 1 nursing care center, 4 home strength, a diversified manufacturing base has resulted in healthcare businesses and over 200 medical growth for the high-tech sector. Evanston’s close professionals and over 30 active physicians. proximity to the Wasatch Front of Utah with a population estimate of approximately 2.5 million makes the Education community ideal for manufactures and other businesses Public education in the city of Evanston is provided by looking for a cost-effective location to serve the Rocky Uinta County School District #1. The district operates a Mountain, Southwest and Northwest regions of the total of eight campuses, including four elementary United States. schools (Aspen, Clark, North, and Uinta Meadows) serving grades Kindergarten through five, two middle schools (Davis and Evanston) serving grades six through eight, one high school (Evanston) serving grades nine through twelve, and one alternative secondary school (Horizon). Higher education is provided by Western Wyoming Community College and Uinta BOCES 1 Education Center. A number of colleges and universities are located along the Wasatch Range from Provo Utah to Ogden, Utah, including: Brigham Young University, University of Utah, Weber State and Utah State University.

Tourism A study by Dean Runyan Associates for the State of Wyoming, reported the travel and hospitality industry are the second largest industry in the State of Wyoming. Direct impact of travel spending by all domestic and international visitors generated over $3.6 billion in 2017, an increase of 8.9 percent over 2016. Wyoming welcomed 8.7 million overnight visitors, an increase of 3.2 percent over the previous year. Visitors who stayed overnight in commercial lodging facilities spent $1.9 billion in 2017 – more than half (54%) of all visitors Evanston’s primary employers include: Uinta County spending in the state. The state’s tourism industry in School District (1,580), Wyoming State Hospital (460), 2017 supported 32,120 full and part-time jobs with travel- Redi Service (450), County/Municipal Government (360), generated earnings of $923 million. Uinta County Wal-Mart Super Center (250), Evanston Regional including Evanston received a gross travel spending Hospital (235), Mountain Regional Services (210). Union benefit $91.8 million with job creation of 950 jobs. Wireless (200), Merit/Anadarko (Formerly BP) 200, Hilcorp (Formerly Chevron) 110. The most common employment sectors for those who live in Evanston are Healthcare & Social Assistance (18.9%), Retail trade (13.5%), and Accommodation & Food Service (12.9%).

Day Travel National Parks Vacation Home $272 There is no better place to experience the great outdoors $149 ($253) than Wyoming. The state is home the nation's first ($142) national park—Yellowstone—and its southern neighbor, Grand Teton. With a combined 2.3 million acres, Wyoming’s national parks are home to unmatched Hotel, natural beauty, diverse wildlife and endless things to do , B&B and places to explore. Campground $1,907 Yellowstone is a sight no matter what time of year you $811 ($ 1,755) visit, but the nation’s first national park in the winter is ($719) truly something to behold. When the park becomes snow-covered in the winter, visitors can snowshoe or ski Private Home miles of trails, view bison and other wildlife or take a $392 snow coach or snowmobile through the uncrowded park ($372) with an authorized guide.

Winter Attractions Winter is a great time to visit Evanston. Snow, ice and Tourist Activities cold mean it’s time to enjoy winter activities and Surrounded by mountains on all sides, Evanston is a attractions. Evanston is a perfect base for exploring 80 recreational mecca for fishing, hunting, hiking, mountain miles of groomed snowmobile trails on the north slope of biking, wildlife viewing, camping and many other outdoor the Uinta Mountains. There also more than 165,000 recreational opportunities. The Bear River flowing right acres of U.S. Forest Service land open to snowmobiling. through town presents opportunities for a whole host of Local companies rent, repair and offer snowmobile tours. activities including bull elk and buffalo within the Bear Groomed trails for Cross-Country Skiing are found at River State Park. Within a few minutes’ drive you can three areas in town: Purple Sage Golf Course, Aspen enjoy the north slope of the Uinta Mountains. Elementary and Bear River State Park. A more extensive system of trails is maintained at the Lily Lake The Evanston area embraces ranching, agriculture, and Cross Country Ski Area, located 30 miles south of development of natural resources. To celebrate, Evanston in the Uinta Mountains. Other activities include Evanston is host to a variety of events, including Cowboy ice fishing, horse-drawn sleigh rides, dog sled races and Days, the Evanston Brew Fest and Evanston Airport superb opportunities to watch wildlife. Days. Nearby ranchers are opening their doors to guests who want a taste of the real Western experience. World Class Alpine Skiing They offer horseback riding, wagon rides and Western The Greatest snow on Earth is found in the Wasatch cooking classes. Since 1993, the Evanston Rodeo mountains of Utah with world class ski resorts. A short Series has been bringing the true American sport to drive west of Evanston on I-80 is the Park City, Wolf southwestern Wyoming. Mountain and Deer Valley resorts. Located a short Evanston’s 18-hole golf course offers a refreshing distance off I-84 is Snowbasin where events of the 2002 challenge for golfers looking for cooler summertime Olympic Winter Games were held and Powder Mountain, temperatures, clear skies and no crowds. Evanston has both resorts are very affordable and local favorites. over 20 parks and outdoor-recreation areas for Snowbird and Alta resorts are located in Little picnicking, family reunions, baseball or soccer games, or Cottonwood Canyon. Other resorts include Brighten and just letting the kids play. Experience Annual Community Solitude resorts in Big Cottonwood Canyon and Events: Wyoming Downs Horseracing, Brewfest, Sundance resort in Provo Canyon. No matter the level of Bluegrass Festival, Rodeos, and County Fair. If you’re in skier they will enjoy the mountain beauty and challenge the mood for a short drive, try Fort Bridger State of the runs. Historical Site between Evanston and Green River. The fort was a trading post for pioneers and miners built in Summary and conclusion the 1840s. Over Labor Day weekend the Fort hosts the Historically, Evanston has relied primarily on oil & gas Mountain Man Rendezvous, a festival that will give you a exploration to the area. This was due to the national taste of real frontier life. boom and incentives offered to oil and gas companies and demand for petroleum by-products. Recently, over Step back and take in one of Wyoming’s greatest assets: the last six years, the State of Wyoming, Uinta County night skies. With some of the darkest skies in the and Evanston have experienced significant increases in country, unobstructed views and endless amounts of tourism for the local economies. public lands Wyoming’s night skies are worth the trip.

Once, dependent on mining, oil & gas exploration and Consumer confidence was up, employment levels related activities, Evanston has benefited from the increased, GDP improved and inflation remained low; all efforts of the State of Wyoming’s effort to diversify its these factors contributed to increased leisure and travel. economy. The growth in tourism has resulted in an Overall, a favorable economic climate positively affected increase in job growth of 4.8%, housing and commercial the hotel industry, resulting in another year of profitable development and annual revenue of over $3.5 billion. operations. This positive momentum continued The stability of the of the community has attracted throughout 2018. several employers in the education and healthcare fields. The historical trends in economic and Room demand and average daily rate (ADR) are strongly demographic data suggest that the future prospects for influenced by growth in U.S. Gross Domestic Product the Evanston area favorable. Current market conditions and employment trends. GDP measures the nation’s have stabilized in a majority of economic sectors. economic growth based on its output of goods and However, the regional economic diversification and services, while job creation is an important factor which natural amenities, such as weather, national parks and influences discretionary income levels. industry as a outdoor activities, will continue to attract visitors to the whole has experienced record-breaking profit levels for area. Overall, The Knights Inn in Evanston is well the past two years. located to benefit from the growth of tourism. The Mountain States including Wyoming, Utah, and Colorado are following the lead established by the REAL ESTATE MARKET national industry’s recovery even though parts of the region economy have lagged emerging from the While job growth fuels the aggregate demand for growth recession period. The supply/demand equation is finally in commercial real estate and business, consumer getting in balance with little to no inventory being added confidence impacts the timing of that demand. Over the to the marketplace. This has resulted in increases in past few years, businesses have been downsizing, overall occupancy levels. Equally important, it has consolidating operations and deferring expansion plans established the framework for an upward movement in in reaction to the recent crash of the real estate market the average daily rate (ADR). Since room revenue is the in 2007-2008 and subsequent financial crises followed most lucrative department within the hotel operation, any by recession. In 2013, the long-awaited national real increases in ADR have a positive effect on the estate market recovery began to take hold after six long improvement of the bottom-line operating results. years of anticipation. Now, with the economy continuing to recovery, business optimism is high, and real estate Southwest Wyoming decisions that were postponed are now being Evanston’s lodging industry like the nation as a whole, reconsidered and implemented. has begun its recovery from the recessionary period from 2007 to 2012. As mentioned in the Area Data section of Evanston offers a wide range of affordable housing the presentation, Evanston’s economic recovery, as well options, single story ranch to multi-level contemporary as its real estate market recovery, are well under way. style to apartments and condominiums. In 2016, the This bodes well for the lodging industry throughout the median single-family property value in Evanston was greater southwest region of Wyoming as the 2018 results $164,700 which grew to $170,100 in 2017 with an are already demonstrating. additional increase in 2018 to $196,900 or an increase of 19.6%. Single-family rents range from $800 to $1,200 per/month, apartment rents range from $600 to Knights Inn – Red Lion $900 per/month. General Background Various developments in the lodging industry have made it increasingly difficult to determine where the particular LODGING MARKET ANALYSIS lodging facility belongs. The segmentation nomenclature for the lodging industry will always be subject to some National vagaries and exceptions. The long-awaited recovery in the U.S. lodging market is firmly in place. By now, it is commonly believed Smith Travel Research, a leader in data collection for the throughout the industry that virtually every hotel/resort lodging industry, categorizes the hotel industry into six market in the United States had a tremendous 2017 and segments known as “chain scales”: Luxury, Upper-scale, even better in 2018. This can be contributed in large Upscale, Midscale (with food and beverage), Midscale part to the fact that the United States’ economy has (without food or beverage), and Economy. However, emerged from the recession that began in 2007-2008. another industry-wide categorization of hotels is broken While recovery has been sluggish, an analysis of factors down into three classes: Limited Service, Select-Service, affecting the nation’s lodging industry showed and Full-Service. discernible improvements in 2017 with a number of economic indicators.

A Select Service Hotel, as the name suggests, offer the Interstate 80 and easy access from Exit 3 (Overthrust fundamentals of limited-service properties together with Rd), Evanston, Wyoming. The hotel serves Interstate 80 a selection of the services and amenities characteristic travelers, summer and winter visitors and tourists to the of full-service properties. Generally, this means certain southwest corner of the State of Wyoming. The hotel restaurant and banquet facilities but on a less elaborate functions as a meeting place for guests and visitors with scale one would find at full-service hotels. Select- an outdoor deck area, restaurant and lounge. service hotels keep operating costs down by offering services and amenities in moderation. Hence, such The nearby downtown Evanston afford guests a vast properties generally do not feature multiple restaurants, array of activities unique to the location, Knights Inn – expansive catering services, or an abundance of Red Lion provide an affordable base for international meeting space, e.g. full restaurant amenity is likely to travels for day trips to local attractions and National offer a limited menu and generally does not open for all Parks, Ski Resorts and scenic road trips. The three meals, seven days a week. combination of unequalled recreation amenities, services, and affordable accommodations assure the hotel’s In-room amenities, however, can approach or meet the position as one of the best places to stay in the levels found at full-services hotels. The hotel services southwest region of Wyoming. often cater to extended-stay travelers. These “home- away-from-home” hotels offer rooms with kitchen facilities and a small dining table, and may offer discounted weekly and monthly rates. Typical characteristics of a select-service hotel would typically include:

• Full size beds and bathroom

• Restaurant and Lounge

• Small meeting rooms

• Swimming pool and Spa

• Guest laundry

• Extended stay Guest Accommodations • Competitive room rates All accommodations are well appointed for the comfort, relaxed southwestern environment and exceptional While the term “select-service” may be relatively new to amenity package. Each room has a full bath, bedroom of the lodging scene, the concept has been around for choice, television, dresser, side table, comfortable many years. For most people, a , or a reading chair and lighting. Three room options are evokes an image of the available: extended stay, king, Queen and twin double quintessential select-service hotel. But the term also bed rooms, adjoining rooms are also available. Guests describes individual properties from largely limited- are afforded daily attendant service. Guest laundry and service brands such as , and fitness room are available for the convenience of guests. Clarion when those properties feature on-site The Honeymoon Suite is a spacious two room suite restaurants or a more elaborate array of in-room equipped with an in-room Jacuzzi. All these elements amenities. combine to create a unique destination hotel Evanston and Southwest Uinta County and the State of Wyoming. The select-service segment has continued to increase its competitive advantage by offering the in-room amenities of full-service hotels while keeping prices low Convention and Meeting Activity in the absence of a full-spectrum product offering. The Knights-Inn – Red Lion offer a unique convention Today’s select-service hotels caters to the demands of and meeting destination in the Evanston market area the group market segment, as well as offering a lodging offering convention and meeting facilities with alternative to extended stays, leisure traveler, and group accommodations at affordable prices. A vast array of conventions and events. summer and winter recreational activities enhance the convention and meeting experience. From meeting planner’s viewpoint, the Knights Inn – Red Lion enjoys Knights Inn – Red Lion some clear advantages including: a full restaurant and The 119-room hotel is strategically located along lounge, meeting rooms, parking, outdoor deck and Wasatch Road with excellent unobstructed visibility from courtyard for events.

Days Inn 1983 Harrison Drive, Evanston 94 Rooms Building Size 61,180 SF Sub-type Select-Service Visibility Harrison Accessibility Exit 3 Average Reservation software – Wyndham Restaurant, Meeting rooms Indoor pool Year Built 1982

Hampton Inn 101 Wasatch Road, Evanston 73 Rooms Building Size Unknown Sub-type Limited-Service The hotel features a full restaurant and lounge; meeting Visibility I-80 Excellent rooms; fitness room, RV parking, guest laundry and Accessibility Exit 3 Very Good inviting lobby with a large fireplace. Reservation software – Hilton Indoor pool Year Built 2009

Holiday Inn Express 1965 Harrison Drive, Evanston 62 Rooms Building Size 33,948 SF Sub-type Limited-Service Visibility I-80 Good Accessibility Exit 3 Average Reservation software – Indoor pool Year Built 2004

Super 8 1710 Harrison Drive, Evanston 73 Rooms Building Size Unknown Competition Sub-type Limited-Service Due to the broad range of appeal to travelers, tourists, Visibility Harrison room rates and accommodations, only properties within Accessibility Exit 3 Average the marketplace that will compete with the Knights Inn – Reservation software – Wyndham Red Lion have been presented. Upon comparative Year Built 1980 analysis and review of the overall amenities of these Evanston properties, it should be noted that none of the Comfort Inn properties are fully comparable to the Knights Inn – Red 1931 Harrison Drive, Evanston Lion. 56 Rooms Building Size 25,886 SF Knights Inn – Red Lion Sub-type Limited-Service 339 Wasatch Road, Evanston Visibility Harrison 119 Rooms on-line / 21 temporary off-line Accessibility Exit 3 Average Type Hospitality Reservation software – Choice Hotels Sub-type Select-Service Indoor pool, Meeting rooms Visibility I-80 Excellent Year Built 2001 Accessibility Exit 3 Very Good Reservation software – Red Lion Restaurant and Lounge Meeting Rooms Year Built 1982 Renovated 2017-2018

COMPARABLE SALES ANALYSIS Grand Junction Address 752 Horizon Drive Grand Junction, Colorado 81506 The sales comparison methodology relies on the Year Built 1973 principal of substitution, where a prudent purchase Building Size 51,262 square feet would pay no more for a property than the cost of Guest Rooms 104 acquiring a comparable property of equal utility. The Sales Price $3,075,000 process involves the identification of recently sold Close of Sale 07/24/2017 comparable properties (e.g., Guest Rooms) so that one Price/SF $59.99 can estimate the asking price the subject property would Price/Room $29,567 command in the market if similar in terms of all their Actual Cap Rate 9.0% important characteristics. Local market conditions were such that the search for comparable sales had to be expanded in terms of geography and time. The Knights Inn Colorado Springs expanded search revealed five sales of Limited-Service Address 2852 South Circle Drive and Select-Service Hotels with over 100 guest rooms. Colorado Springs, Colorado 80906 Year Built 1967 Comparable Sales (over 100 Rooms) Building Size 98,759 square feet The subject property and each of the five sales were Guest Rooms 176 improved with over 100 Guest Rooms which a Sales Price $3,000,000 hypothetical purchaser would consider an alternative to Close of Sale 05/18/2017 the Knights Inn–Red Lion. Price/SF $30.38 Price/Room $17,045 Baymont Inn & Suites Actual Cap Rate 11.67% Address 4465 South Century Drive Murray, Utah 84123 Year Built 2004 Comparable Sales (Under 51 Rooms) Building Size 61,276 square feet The weaknesses of the available market data required to Guest Rooms 127 further estimate a reasonable price per room could be Sales Price $6,400,000 overcome by taking prudent steps, such as reducing the Close of Sale 03/31/2017 number of hotel rooms. The following five sales occurred Price/SF $104.45 between March 2018 and September 2018. Price/Room $50,394 Actual Cap Rate 9.0% Comfort Inn Address 311 Royal Gorge Boulevard Grand Lodge at Brain Head Canyon City, Colorado 81212 Address 314 Hunter Ridge Road Year Built 1997 Brian Head, Utah 84719 Building Size 21,237 square feet Year Built 1985 Guest Rooms 50 Building Size 100,000 square feet Sales Price $2,300,000 Guest Rooms 100 Close of Sale 09/21/2018 Sales Price $5,800,000 Price/SF $76.79 Close of Sale 10/09/2017 Price/Room $46,000 Price/SF $58.00 Actual Cap Rate 10.0% Price/Room $58,000 Actual Cap Rate Unknown Address 985 U.S. Highway 24 Wingate – Clarion Inn Limon, Colorado 80828 Address 14378 US-34 Highway Year Built 1990 Fort Morgan, Colorado 80701 Building Size 18,810 square feet Year Built 1971 Guest Rooms 47 Building Size 58,562 square feet Sales Price $2,530,000 Guest Rooms 100 Close of Sale 07/05/2018 Sales Price $3,075,000 Price/SF $134.50 Close of Sale 05/03/2018 Price/Room $53,830 Price/SF $52.51 Actual Cap Rate 11.0% Price/Room $30,750 Actual Cap Rate 10.90%

Sandhill Inn & Suites ANNUALIZED OPERATING DATA Address 1519 Grand Avenue Monte Vista, Colorado 81144 The Income Approach consists of methods and Year Built 1971 techniques used to analyze a property’s capacity to Building Size 20,868 square feet generate benefits. These benefits are then converted Guest Rooms 45 into a property value via the capitalization of the income Sales Price $1,750,000 expectancy at market derived rates. A summary of Close of Sale 06/01/2018 extensive operating data is presented in the following Price/SF $83.86 table. Price/Room $38,889 Actual Cap Rate 10.00% 2018 2019** Stabilized Stay Wise Total Rooms 115 119 140 Address 2100 Easy Main Street Guest Rooms 75 119 130 Days Open 365 365 365 Montrose, Colorado 81401 Total Days 27,375 43,4355 47,450 Year Built 1995 Occupied Room Night 13,651 21,718 26,098 Building Size 24,942 square feet Occupancy 44.0% 50.0% 55.0% Guest Rooms 51 Average Daily Rate $23.70 $35.00 $50.00 RevPAR $10.43 $17.50 $27.50 Sales Price $2,100,000 Close of Sale 05/15/2018 REVENUE Price/SF $84.20 Guest Rooms $323,475 $760,113 $1,304,875 Food & Beverage 139,754 225,000 325,000 Price/Room $41,176 Other Income 4,760 25,000 45,000 Actual Cap Rate Unknown Total Revenue 467,989 1,010,113 1,674,875

Allington Inn & Suites DEPARTMENTAL EXP Address 182 Frontage Road Guest Rooms 84,628 204,653 341.381 Food & Beverage 50,381 78,750 113,750 Colorado Springs, Colorado 81154 Other Income 1,617 3,801 6,524 Year Built 1997 Total Dept. Expenses. 136,626 287,203 $367,238 Building Size 24,100 square feet Guest Rooms 43 UNDISTRIBUTED EXP Administration 37,711 82,193 132,316 Sales Price $1,250,000 Marketing 30,419 66,970 112,133 Close of Sale 03/02/2018 Franchise fees 6,470 15,202 26,098 Price/SF $51.87 Property Operations 20,638 44,758 74,565 Utilities 28,641 62,122 104,100 Price/Room $29,070 Total Undistributed 123,879 271,246 449,121 Actual Cap Rate Unknown INCOME BEFORE FIXED Property Taxes $9,267 9,360 9,750 Summary of Comparable Sales Insurance 23,889 24,495 25,000 In the first set of data, five confirmed sales of Limited- Reserve for Replacement 5,152 11,120 18,804 Service and Select-Service Hotels with similar locational Total $38,308 44,975 $83,940 and physical characteristics (100 Guest Rooms or NET INCOME $169,176 $406,688 $774,576 more) with closing dates from May 2017 to May 2018 ** Projected 2019 are presented. Based on the unadjusted unit price of Guest Rooms a range from $17,045 to $58,000 was revealed with a Mean of $37,151 and a Median of FINANCIAL ANALYSIS $30,750 per guest room. Total Room Count ……………………………………… 119 In the second instance, five confirmed sales of Limited- Price per Guest Room ……………………………. $37,500 Service and Select-Service Hotels with under 51 Guest Price per Square Foot ……………………………… $70.00 Rooms similar characteristics are presented. Based on PGIM ……………………………………………………. 3.00 the unadjusted unit price of Guest Rooms a range from Capitalized Income …………………………………. 8.75% $29,070 to $53,830 was revealed with a Mean of Sales Comparison ($39,000) ………………… $4,641,000 $41,779 and a Median of $41,176 per Guest Room. Building Square Footage ($75.00/SF) ………. $4,677,750 PGIM ($1,520,226 - year 2019) …………….. $4,560,678 Additionally, the ten sales presented revealed an Income CAP (2019 NOI) ……………………... $4,647.863 unadjusted cost per square foot range from $134.50 to $30.38 per square foot with a Mean of $73.61 and a Concluded Asking Price ……………………. $4,625,000 Median of $68.39 per square foot.

INVESTMENT HIGHLIGHTS ASKING PRICE and TERMS

The continued success of the Knights Inn – Red Lion is The asking price is all inclusive of the Hotel, Restaurant dependent upon the hotel’s ability to satisfy a need in and Lounge, Site, Site Improvements, FF&E, Flag and the market place; provide appropriately priced reservation software. hospitality services; achieve stabilized occupancy; and affordably manage and maintain the hotel facilities. A Full Purchase Price …………………………… $4,625,000 number of locational and physical characteristic Down Payment all cash ………………………. $4,625,000 enhance the operations and success.

• Strong Interstate visibility and access • Convenient Regional and Local Location • Recent Renovation and Updating • Strong market position • Reservation software • Returning guests • Extended stay guests • Popular Sports Bar • Top rated local restaurant and lounge • Planned Conventions 2019

Current ownership has renovated the exterior and interior of the hotel and updated rooms with new furnishings. Also, ownership has solicited various groups, schools, clubs and in-door tournaments in building income and increasing occupancy doing off- season months. New ownership will need to continue promotion of the hotel facilities and expand penetration In summary the energetic management team of Knights into I-80 travelers and on-line services. Additional profit Inn – Red Lion are supported by trained staff members in centers in the form of Hotel Fees & Surcharges should ensuring our visitors have a wonderful experience an be considered. whether extended or one-night stay. The on-going success bringing stability and efficiency to the operations Fees and surcharges at U.S. hotels are expected to hit of the facility is a team effort. a record $2.93 billion in 2018 and increase over 2017 of 8.5%. This year's climb is driven by a 2.5 percent year- over-year increase in occupied hotel rooms, plus ASSISTANCE and additional fee and surcharge categories. These fees CONTACT INFORMATION are similar to resort fees averaging between $20 and $40. Donna Lapin [email protected] Where a resort fee would not be applicable, services (307) 789-2220 related to these fees and surcharges range from no new services to planned or unscheduled activities such as Roy Tolson visits to local attractions, receptions, and printing, [email protected] copying, overnight package delivery, 'complimentary' (602) 460-6963 bottled water, newspapers and early or late check-out if not in conflict hotel occupancy, and others. Other fees that have emerged or accelerated in recent years include charges for early check-in, as well as fees for holding checked luggage.

For 2019, STR and Tourism Economics project the U.S. hotel industry to report a 0.1% increase in occupancy to 66.2%, a 2.3% lift in ADR to $132,81 and 2.4% rise in RevPAR to $87.89. All indications bode well for the Knights Inn – Red Lion.