HOLIDAY INN EXPRESS & SUITES 1030 E Palestine Ave • Palestine, TX 75801 1 HOLIDAY INN EXPRESS & SUITES

OFFERING SUMMARY EXECUTIVE SUMMARY

VITAL DATA TTM MAY 2017 YEAR 1 MAJOR EMPLOYERS Price $3,800,000 CAP Rate 9.48% 10.03% Net Operating Income $368,614 $381,094 Down Payment 25.77% / $979,163 Net Cash Flow After Debt Service 15.16% / $148,455 16.44% / $160,936 EMPLOYER # OF EMPLOYEES Loan Amount $2,916,285 Total Return 20.66% / $202,332 21.94% / $214,813 Palestine Regional Home Care 700 Loan Type Proposed New Regions Financial Corporation 612 Interest Rate / Amortization 5.75% / 25 Years Rue21 Inc 605 Price/Room $61,290 Walmart 600 Ownership Type Fee Simple 5j Oilfield Services LLC 300 Number of Rooms 62 Westwood Primary School 200 Rentable Square Feet 14,024 Goodwill Inds E Texas Inc 191 Number of Buildings 1 City of Palestine 183 Number of Stories 3 Lifepoint Hospitals Inc 177 Year Built 1999 Cartmell Home For Aged Inc 175 Lot Size 3.39 Acre(s) Gerry Red Inc 170 5j Transportation L L C 165

DEMOGRAPHICS

1-Miles 3-Miles 5-Miles 2016 Estimate Pop 2,798 14,174 22,064 2016 Census Pop 2,855 14,575 22,509 2016 Estimate HH 951 5,290 8,297 2016 Census HH 971 5,475 8,506 Median HH Income $35,681 $37,219 $39,430 Per Capita Income $18,878 $21,617 $21,770 Average HH Income $54,156 $57,153 $56,829

#2 HOLIDAY INN EXPRESS & SUITES

OFFERING SUMMARY INVESTMENT OVERVIEW

The Holiday Inn Express is being offered at 3.43 times the May 2017 trailing twelve months revenue. At a list price of $3.8M, or $61,290 per key, the hotel is being offered significantly below replacement cost. The hotel was completely renovated in 2015 and is expected to have a minimal Property Improvement Plan at transfer for the new owner. Currently, the hotel has an Net Operating Income of $368,614 which is a 9.70 percent capitalization rate at the current list price. The hotel, along with the Palestine market, is up over 17 percent in RevPAR year-over-year and continues to show growth as the year progresses.

INVESTMENT HIGHLIGHTS

. 62-Room, Interior Corridor, Limited Service Hotel . Offered at 3.43 Times May 2017 T-12 Months Room Revenue . Completely Renovated in 2015 - Minimal PIP Expected at Transfer . Priced Significantly Below Replacement Cost - $61,290 . Multiple Torchbearer Awards and Quality Excellence Awards

3 HOLIDAY INN EXPRESS & SUITES

OFFERING SUMMARY PROPERTY OVERVIEW

Property Overview: The Holiday Inn Express & Suites is a 62-room, interior corridor, limited service, mid-scale hotel located in Palestine, Texas. Built in 1999, this three-story hotel is a wood frame structure with stone and EIFS/stucco exterior facade. The hotel features a unique and modern lobby unlike any other Holiday Inn Express & Suites in the IHG system. The hotel has won multiple Torchbearer Awards and Quality Excellence Awards over the past few years. Adjacent to the hotel is a four bedroom two and 1/2 bathroom home with a one car garage that can be acquired with the purchase of the hotel for an additional amount.

Location Overview: Palestine, Texas, has recently been recognized by Texas Highways Magazine as one of the top locations for travel and visitors. There are many nearby attractions like the Texas State Railroad, Davey Dogwood Park, and the Downtown Historic District. Annual events in Palestine include the Annual Peanut Festival, Canoe Races, Dogwood Trails Festival, Palestine Community Theatre events, Rodeos, and the Dulcimer Festival. Major Common Area Amenities employers in Palestine include Palestine Regional Medical Center and Palestine Regional Rehabilitation Hospital, Walmart, and the Texas Department of Criminal Justice Correctional Facilities. Sanderson Farms, Inc's major expansion initiative is also creating approximately 1,350 new jobs and $265 million in capital investment. . High Speed Wireless Internet Access . Fitness Center . Outdoor Swimming Pool and Spa . Guest Self-Laundry . Business Center

Guest Room Amenities

. High Speed Wireless Internet Access . Iron/Ironing Board . Flat Screen Television . Mini-Refrigerator . Microwave

#44 HOLIDAY INN EXPRESS & SUITES

OFFERING SUMMARY PROPERTY SUMMARY

THE OFFERING ROOM TYPES Property Holiday Inn Express & Suites NUMBER OF ROOMS ROOM TYPE Price $3,800,000 32 Queen Property Address 1030 E Palestine Ave, Palestine, TX 27 King SITE DESCRIPTION 3 Suite/Kitchenette Number of Rooms 62 PROPOSED FINANCING Year Built/Renovated 1999 FIRST TRUST DEED Ownership Type Fee Simple Loan Amount $2,916,285 Lot Size 3.39 Acres Loan Type Proposed New Parking Ample Interest Rate 5.75% CONSTRUCTION Amortization 25 Years Foundation Concrete Loan Term 25 Years Framing Wood Loan to Value 77% Exterior Stucco Debt Coverage Ratio 1.73 Parking Surface Concrete SECOND TRUST DEED Roof Angled Shingles Loan Type All Cash MECHANICAL HVAC PTAC Elevators Yes (1) Fire Protection Sprinkler System CHANGE TO FRANCHISE Application Fee $50,000 Minimum Parent Company IHG Term 10-15 Years Royalty / Marketing Fee 6% of GRR / 3% of GRR

5 HOLIDAY INN EXPRESS & SUITES

AERIAL PHOTO

6 HOLIDAY INN EXPRESS & SUITES

PROPERTY PHOTO

Marcus & Millichap closes more transactions than any other brokerage firm.

Skyler Cooper Vice President, National Hospitality Group Office: (713) 452-4275 Mobile: (540) 522-9115

Joseph Jaques Associate, National Hospitality Group Office: (972) 755-5171 Mobile: (979) 229-7673

127