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T U M B L E W E E D H O T CONFIDENTIAL OFFERING MEMORANDUM TUMBLEWEED HOTEL 6333 E. CAVE CREEK ROAD | CAVE CREEK, AZ 85331 AFFILIATED BUSINESS DISCLOSURE DISCLAIMER CBRE, Inc. operates within a global family of companies with many subsidiaries This Memorandum contains select information pertaining to the Property and and related entities (each an “Affiliate”) engaging in a broad range of commercial the Owner, and does not purport to be all-inclusive or contain all or part of the real estate businesses including, but not limited to, brokerage services, property information which prospective investors may require to evaluate a purchase and facilities management, valuation, investment fund management and of the Property. The information contained in this Memorandum has been development. At times different Affiliates, including CBRE Global Investors, Inc. obtained from sources believed to be reliable, but has not been verified for or Trammell Crow Company, may have or represent clients who have competing accuracy, completeness, or fitness for any particular purpose. All information is interests in the same transaction. For example, Affiliates or their clients may presented “as is” without representation or warranty of any kind. Such information have or express an interest in the property described in this Memorandum (the includes estimates based on forward-looking assumptions relating to the general “Property”), and may be the successful bidder for the Property. Your receipt of economy, market conditions, competition and other factors which are subject this Memorandum constitutes your acknowledgement of that possibility and to uncertainty and may not represent the current or future performance of the your agreement that neither CBRE, Inc. nor any Affiliate has an obligation to Property. All references to acreages, square footages, and other measurements disclose to you such Affiliates’ interest or involvement in the sale or purchase are approximations. This Memorandum describes certain documents, including of the Property. In all instances, however, CBRE, Inc. and its Affiliates will act leases and other materials, in summary form. These summaries may not be in the best interest of their respective client(s), at arms’ length, not in concert, complete nor accurate descriptions of the full agreements referenced. Additional or in a manner detrimental to any third party. CBRE, Inc. and its Affiliates will information and an opportunity to inspect the Property may be made available conduct their respective businesses in a manner consistent with the law and to qualified prospective purchasers. You are advised to independently verify all fiduciary duties owed to their respective client(s). 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 Property’s suitability for your CONFIDENTIALITY AGREEMENT needs. ANY RELIANCE ON THE CONTENT OF THIS MEMORANDUM IS SOLELY Your receipt of this Memorandum constitutes your acknowledgement that (i) it is AT YOUR OWN RISK. a confidential Memorandum solely for your limited use and benefit in determining whether you desire to express further interest in the acquisition of the Property, The Owner expressly reserves the right, at its sole discretion, to reject any or all (ii) you will hold it in the strictest confidence, (iii) you will not disclose it or its expressions of interest or offers to purchase the Property, and/or to terminate contents to any third party without the prior written authorization of the owner discussions at any time with or without notice to you. All offers, counteroffers, of the Property (“Owner”) or CBRE, Inc., and (iv) you will not use any part of and negotiations shall be non-binding and neither CBRE, Inc. nor the Owner shall this Memorandum in any manner detrimental to the Owner or CBRE, Inc. have any legal commitment or obligation except as set forth in a fully executed, If after reviewing this Memorandum, you have no further interest in purchasing definitive purchase and sale agreement delivered by the Owner. the Property, kindly return it to CBRE, Inc. FOR MORE INFORMATION AND TO VIEW OUR CURRENT LISTINGS, VISIT: cbredealflow.com © 2019 CBRE, Inc. All rights reserved. This information has been obtained from sources believed reliable, but has not been verified for accuracy or completeness. You should conduct a careful, independent investigation of the property and verify all information. Any reliance on this information is solely at your own risk. Photos herein are the property of their respective owners and use of these images without the express written consent of the owner is prohibited. 2 TUMBLEWEED HOTEL | CAVE CREEK, ARIZONA I. Executive Summary II. Property Overview III. Area Overview IV. Financial Performance TUMBLEWEED HOTEL | CAVE CREEK, ARIZONA 3 CONTENTS Executive Summary 4 TUMBLEWEED HOTEL | CAVE CREEK, ARIZONA EXECUTIVE SUMMARY CBRE Hotels is pleased to present a unique opportunity to acquire the Tumbleweed Hotel, a newly remodeled, western-chic hotel centrally located in downtown Cave Creek, Arizona. Referred to as “Fashionable revival or what was cool about the West,” the hotel is on the market for the first time in over 15 years, having been transformed from a place to stay while passing through Cave Creek, to a destination in and of itself. Using their background in art and retail, ownership has transformed the guestrooms and casitas into eclectic and modern, well-designed rooms, while maintaining its western heritage and complementing the surrounding art galleries, restaurants and boutiques that line Cave Creek Road. The Tumbleweed Hotel now draws visitors from all over the world, looking for an authentic western experience, with modern amenities and exceptional style. Situated on nearly three acres in the heart of downtown Cave Creek, Tumbleweed Hotel is comprised of a 16-unit, two- story hotel, an 8-unit, two-building casita complex, a 3,570 sq. ft. building that currently houses the lobby and small gift shop, an outdoor pool, and picnic/BBQ area. The hotel also features superb views of Black Mountain and access to its trails. Ownership is in the process of completing a renovation that includes new furniture and fixtures in all hotel rooms and four of the eight casitas. Tremendous upside exists at the Tumbleweed Hotel that will allow a new owner an extraordinary opportunity to further shape and improve upon the property, thereby maximizing revenue and profits. TUMBLEWEED HOTEL | CAVE CREEK, ARIZONA 5 VALUE ENHANCEMENT OPPORTUNITIES Refine Revenue Management Strategies Develop Eight Luxury Tepees On Underutilized Open Space Convert Four Owner-Occupied Casitas Into Rentable Inventory Maximize Open Space To Generate Additional Income 6 TUMBLEWEED HOTEL | CAVE CREEK, ARIZONA Convert Portion Of Main Building Into Restaurant/Retail Space or Bring In A Third-Party Operator Increase Occupancy through Airbnb rentals Partner With Boutique Booking Reservation Program Or Soft-Brand Affiliation Established as a gold mining town and stopping point for the U.S. Calvary in the mid-1870s, the wild west character is preserved in Cave Creek, featuring several saloons, western shops, rodeo events, galleries, and live music. Located high above Phoenix in the foothills of Black Mountain, Skull Mesa and Elephant Butte, Cave Creek is a must-visit location just minutes from nearby Phoenix and Scottsdale. TUMBLEWEED HOTEL | CAVE CREEK, ARIZONA 7 INVESTMENT HIGHLIGHTS IRREPLACEABLE LOCATION IN THE HEART OF CAVE CREEK The Tumbleweed Hotel boasts an excellent location within walking distance to downtown Cave Creek’s numerous and eclectic shops, restaurants, art galleries, and live entertainment. HIGH BARRIER TO ENTRY MARKET INTO CAVE CREEK/CAREFREE MARKET Extremely high barriers to entry exist in the Cave Creek/Carefree market due to limited, developable land availability and stringent and expensive entitlement processes. UPSIDE POTENTIAL FOR EXPANDED MARKETING AND NEW MANAGEMENT The property would benefit from a new owner with more sophisticated hotel management experience that could take the Tumbleweed Hotel to new heights, through expanded marketing and refined revenue management strategies. 8 TUMBLEWEED HOTEL | CAVE CREEK, ARIZONA UNENCUMBERED BY BRAND OR MANAGEMENT The hotel is ideally offered unencumbered by brand or management, allowing a new owner full optionality to implement their own operational strategies. ADDITIONAL VALUE ENHANCEMENT OPPORTUNITIES AVAILABLE A full array of value enhancement opportunities are available at the Tumbleweed Hotel, including developing eight luxury teepees, converting owner-occupied units into rentable inventory, add/lease retail or restaurant space in main building, include units in Airbnb inventory, and affiliation with soft brand or boutique hotel booking reservation programs. DYNAMIC RESORT MARKET The Phoenix region consistently maintains a status of being one of America’s most popular vacation spots, receiving over 16 million visitors annually. In addition to the many shopping, sightseeing and cultural possibilities, the area offers ample outdoor adventuring activities including camping, golf, fishing, biking, hiking and kayaking. Furthermore, the Phoenix Metro is one of the Southwest’s most acclaimed cultural hubs and is home to the Heard Museum of Native Cultures, Phoenix Art Museum, University of Phoenix Stadium, Arizona Science Center, Comerica Theatre, Desert Botanical Garden, Talking Stick Resort Arena,
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