KNIGHTS VALUE ADD CONVERSION S FRIO ST 1025 SAN ANTONIO

Contact Gerrit Stryker OFFERING SUMMARY 04 713-373-9727 [email protected] FINANCIALS 06 PROPERTY PHOTOS 08 AERIAL MAPS 10 FORECAST 12 COMPARABLES 14

SURVEY 16

OFFERING SUMMARY KNIGHTS INN HOTEL

Investment highlights:

• 90-Unit, Middle Class Partial Suite Hotel - Operating As an Economy Hotel • Unit Mix: 36 suites / 38 doubles / 11 singles / 5 suites converted from managers quarters • Ideal Conversion Into Middle Class Brand • Less Than 1 mile To Riverwalk • 4 Block From Market Square • 1/2 mile to University of Texas - San Antonio Downtown Campus • Interstate 10 and Interstate 35 visibility

Investment Overview: The Knights Inn is a 90 room hotel being operated as a bottom tiered economy hotel. Located in the booming Downtown San Antonio market area, this hotel, originally built as a MicroTel in 1998, is ideal for rebranding into a midscale brand to compete with the strong performing surrounding market. Currently the hotel is running at around $20 RevPar, when the market average is around $72 RevPar, giving this hotel an excellent value add component, with a stabilized conversion Cap Rate pro-forma of around 15%. Renovation PIP costs from Choice Hotel's have estimated the costs to be approx $11,000 per key. Adding higher end finishes to maximize revenue potential, the proforma reflects an $18,800 per key cost estimate, including interest carry and franchise costs. This investment gives a new owner the opportunity to enter into this extremely strong market, with an all in completely renovated hotel at around 50% of the replacement costs.

PRICE $3,350,000 Total Rooms 90 Price / Room $37,222 Occupancy (Proforma) 65% ADR (Proforma) $85 RevPar (Proforma) $55 Number of Buildings 1 Number of Floors 3 Year Built / Renovated 1998 / NA Lot Size 94,873.68 Type of Ownership Fee Simple FINANCIALS FINANCIAL SUMMARY

Price after $400,000 from land sale to City $2,950,000 Total Number of Rooms 90 Turnkey Renovation Costs Per Room / PIP $18,850 $1,696,500.00 Price / Room with PIP $51,628 Occupancy 66% ADR $85 RevPar Available Rentable Rooms 32,850 Rooms Sold 21,681 Cap Rate After Renovations 14.7% Total Cost $4,646,500.00

Annualized Financial Summary Income % of GR Room Revenue $1,842,885 Other Revenue $1,000 Gross Revenue $1,843,885 Total Expenses $1,161,017.55 63% Net Operating Income $681,867 37% Debt Service @ 5% interest ($247,260.44) 13% Debt Coverage Ratio 2.76 Net Cash Flow After Debt Service $434,607.01 24% Principle Reduction $80,500.91 4% Total Return $515,107.91 28%

Description of Renovation Costs Public Areas / Exterior $692,000.00 Guest Rooms $5,555.00 $499,950.00 New Guest Room Furniture $2,800.00 $252,000.00 Guest Room Tv's $300.00 $27,000.00 FINANCING Lobby / Breakfast Furniture $20,000.00 Guest Rooms PTAC A/C $650.00 $58,500.00 Down Payment with PIP Costs 25% $1,161,625 Franchise $50,000.00 Loan Amount 75% $3,484,875 Misc $30,000.00 Interest Rate 5.00% Interest Carry $65,000.00 Amortization 25 years Total Costs of Conversion $1,694,450.00 ROOMS AND SUITES

AERIAL MAPS

FORECAST FORECAST

Quality Inn Conversion- 90 Rooms $18,000 per key conversion ADR 60% Occupancy 66% Occupancy 70% Occupancy REVPAR = $55 $85.00 2017 Room Revenue $1,675,350.00 $1,842,885.00 $1,954,575.00 37% Profit Margin $619,879.50 $681,867.45 $723,192.75 2018 Room Revenue $1,742,364.00 $1,916,600.40 $2,032,758.00 37% Profit Margin $644,674.68 $709,142.15 $752,120.46 2019 Room Revenue $1,812,058.56 $1,993,264.42 $2,114,068.32 37% Profit Margin $670,461.67 $737,507.83 $782,205.28 2020 Room Revenue $1,884,540.90 $2,072,994.99 $2,198,631.05 37% Profit Margin $697,280.13 $767,008.15 $813,493.49 2021 Room Revenue $1,959,922.54 $2,155,914.79 $2,286,576.29 37% Profit Margin $725,171.34 $797,688.47 $846,033.23 COMPARABLES COMPARABLES

On the market for $8,600,000

Sale Status: Sale Pending Property Type: Hotel & Property Use Type: Investment Asking Price: $8,600,000 Property Subtype: Limited Service Cap Rate: 6.63% Building Size: ±45,096 SF Average Daily Rate: $101 Lot Size: ±1.02 Acres RevPAR: $75 No. Stories: 2

Now has 50 Rooms with the sale price $42,650 per key

Sale Status: Sold Property Type: Hotel & Motel Seller: Telemetrics Inc Sale Date: 03/09/2016 Property Subtype: Full Service Buyer: TMM Bros Inc Sale Price: $2,132,500 Building Size: ±21,287 SF 1122 S Laredo St, San Antonio TX 78204 Doc #: 43525 Lot Size: ±0.87 Acres APN: 00921-000-0250 SURVEY

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