OLYMPIC LODGE MICHAEL FRANCIS WES CHRISTENSEN NICHOLAS DIAMOND [email protected] [email protected] Capacity Commercial Group 140 S

OLYMPIC LODGE MICHAEL FRANCIS WES CHRISTENSEN NICHOLAS DIAMOND Mfrancis@Mtnwest.Com Wchristensen@Mtnwest.Com Capacity Commercial Group 140 S

OLYMPIC LODGE MICHAEL FRANCIS WES CHRISTENSEN NICHOLAS DIAMOND [email protected] [email protected] Capacity Commercial Group 140 S. DEL GUZZI DR. direct 801.704.1669 direct 801.704.1662 [email protected] PORT ANGELES, WA 98362 View Profile View Profile direct 503.222.2655 TABLE OF CONTENTS

EXECUTIVE 6 SUMMARY MARKET 7 GENERATORS PROPERTY 8 OVERVIEW 10 MAPS 12 FINANCIALS 18 AREA OVERVIEW 19 DEMOGRAPHICS

OLYMPIC LODGE 2 Mountain West Commercial | Office 801.456.8800 | www.mtnwest.com OLYMPIC LODGE CONFIDENTIALITY AND DISCLOSURE

140 S. DEL GUZZI DR. Mountain West Commercial Real Estate and Capacity Commercial Group have been retained on an PORT ANGELES, WA 98362 exclusive basis to market the property described as 140 S. Del Guzzi Dr. Port Angeles, WA, 98362. Broker has been authorized by seller of the property to prepare and distribute the enclosed information for the PREPARED BY purpose of soliciting offers to purchase from interested parties. More detailed financial, title and tenant lease information may be made available upon request following the mutual execution of a letter of intent MICHAEL FRANCIS or contract to purchase between the Seller and the prospective purchaser. You are invited to review this [email protected] opportunity and make an offer to purchase based upon your analysis. If your offer results in the Seller direct 801.704.1669 choosing to open negotiations with you, you will be asked to provide financial references. The eventual View Profile purchaser will be chosen based upon an assessment of price, terms, ability to close the transaction and such other matters as the Seller deems appropriate. WES CHRISTENSEN [email protected] The Material is intended solely for the purpose of soliciting expressions of interest from qualified investors direct 801.704.1662 for the acquisition of the Property. The Material is not to be copied and /or used for any other purpose or View Profile made available to any other person without the express written consent of Broker or Seller. The Material does not purport to be all-inclusive or to contain all of the information that a prospective buyer may NICHOLAS DIAMOND require. The information contained in the material has been obtained from the Seller and other sources Capacity Commercial Group and has not been verified by the Seller or its affiliates, agents, representatives, employees, parents, [email protected] subsidiaries, members, managers, partners, shareholders, directors, or officers, makes any representation direct 503.222.2655 or warranty regarding such pro forma. Purchaser must make its own investigation of the Property and any existing or available financing, and must independently confirm the accuracy of the projections contained in the pro forma.

Seller reserves the right, for any reason, to withdraw the Property from the Market. Seller has no obligation, express or implied, to accept any offer. Further, Seller has no obligation to sell the Property unless and until the Seller executes and delivers a signed agreement of purchase and sale on terms acceptable to the Seller, in its sole discretion. By submitting an offer, a purchaser will be deemed to have acknowledged the foregoing and agreed to release Seller and Broker from any liability with respect thereto.

Property walk-throughs are to be conducted by appointment only. Contact Broker for additional information.

OVERVIEW SUMMARY OFFERING PRICE $23,000,000 Mountain West Commercial Real Estate and Capacity Commercial Group have been selected to exclusively represent the sale of the CAP RATE 8.8% (2019 YE) Olympic Lodge, Port Angeles, Washington. Located off Washington PRICE/ROOM $219,048 Highway 101 this three-story, interior corridor, 105-room select service, TOTAL NUMBER OF upper midscale hotel sits on a lot size of 2.03 acres. Peninsula Golf 105 Course is located directly behind the hotel with the Olympic Mountains ROOMS in backdrop which offers a stunning view for guests. The property is OCCUPANCY 63.8% (2019) located approximately seven miles to the entrance of Olympic National Park, which hosted over 3.2 million visitors in 2019, and two miles to the ADR $167.46 (2019) Port Angeles Waterfront. The 105 rooms consist of a variety of room REVPAR $106.84 (2019) types with most guest room sizes ranging from 400 to 512 square feet. The Olympic Suite is 800 square feet. The hotel offers a rustic lodge feel for guests with a wood burning fireplace in the lobby and sitting areas. The hotel’s amenities include two meeting rooms, fitness room, on-site restaurant, outdoor swimming pool and hot tub. The hotel is owned by a private investor and is unencumbered by management.

INVESTMENT HIGHLIGHTS • Well Maintained • Unencumbered by Management and Franchise • Located 7 Miles From The Entrance to Olympic National Park (Hurricane Ridge) • 8.8% Capitalization Rate (2019 YE) • 20.34% Five Year Pro-forma IRR

OLYMPIC LODGE 6 Mountain West Commercial | Office 801.456.8800 | www.mtnwest.com MARKET GENERATORS

OLYMPIC NATIONAL PARK OLYMPIC NATIONAL With its incredible range of precipitation and elevation, PARK VISITATIONS diversity is the hallmark of Olympic National Park. 2019 3,245,806 Encompassing nearly a million acres, the park protects a vast 2018 3,104,455 wilderness, thousands of years of human history, and several 2017 3,401,996 distinctly different ecosystems, including glacier-capped 2016 3,390,221 mountains, old-growth temperate rain forests, and over 2015 3,263,761 70 miles of wild coastline. Park visitation has average 3.13 2014 3,243,872 million visitors over the past twelve years and is consistently 2013 3,085,340 ranked in the top 10 most visited National Parks according to 2012 2,824,908 Photo Source: offthebeatenpath.com the National Park Service. 2011 2,966,502 2010 2,844,563

PORT ANGELES FERRY Black Ball Ferry Line operates the M.V. Coho passenger and vehicle ferry linking Victoria, British Columbia on Vancouver Island with Port Angeles, Washington on the scenic Olympic Peninsula.

Photo Source: myportangeles.com

PENINSULA GOLF COURSE Located within one mile of hotel, the course is currently a semi-private club with over 200 golfing members. Peninsula Golf Club offers 18 holes of challenging yet rewarding golf. The course has a tree-lined setting with beautiful views of the Olympic Mountains and the Strait of Juan de Fuca.

Mountain West Commercial | Office 801.456.8800 | www.mtnwest.com 7 PROPERTY DESCRIPTION

ROOM AMENITIES COFFEE MAKER & COFFEE HAIR DRYER IN-ROOM SAFE IRON/ IRONING BOARD 42" TELEVISION WITH DELUXE PREMIUM CABLE ROOM BREAKDOWN SINGLE KING 27 DOUBLE QUEEN 42 DOUBLE QUEEN GOLF 7 COURSE SINGLE KING PATIO 4 SINGLE QUEEN PATIO 3 QUEEN ADA 7 EXECUTIVE KING 7 EXECUTIVE KING PATIO 7 SUITE 1 TOTAL NUMBER OF ROOMS 105 INTERIOR ROOM DETAIL HEATING SYSTEM Individual PTAC COOLING SYSTEM Individual PTAC Shower/ Tub BATH/SHOWER Combination BATHROOM TILE TYPE Ceramic Tile WINDOW COVERINGS Drapes FLOOR COVERINGS Carpet WALL COVERINGS Textured Wall Paper TELEVISIONS 42" Flat Screen Mini-fridge & SMALL APPLIANCES Microwave INTERNET ACCESS High Speed Wireless

OLYMPIC LODGE 8 Mountain West Commercial | Office 801.456.8800 | www.mtnwest.com PROPERTY DESCRIPTION

COMMON AREA AMENITIES SWIMMING POOL & HOT TUB CRESCENT MEETING ROOM - 728 SQUARE FEET STORM KING ROOM - BOARD MEETING ROOM - SEATS 12 FITNESS ROOM FIREPLACE SITTING AREA WHISTLING FROG RESTAURANT SITE DESCRIPTION PARCEL NUMBER APN: 630123490300000 YEAR BUILT 1992 LOT SIZE 2.03 TYPE OF OWNERSHIP Fee Simple PROPERTY TIER Independent William R. Fairchild AIRPORTS International Airport HIGHWAYS Highway 101 CONSTRUCTION/MECHANICAL FOUNDATION Concrete FRAMING Wood EXTERIOR Composite Wood & Stone PARKING SURFACE Asphalt Asphalt Shingles & Rubber ROOF Membrane PLUMBING PVC & Copper ELEVATOR COUNT One HVAC Individual PTAC Sprinklers, Fire Alarm, Locking FIRE/SAFETY Doors UTILITIES WATER/SEWER City ELECTRIC City OLYMPIC LODGE GAS Amerigas (Propane) 9 Mountain West Commercial | Office 801.456.8800 | www.mtnwest.com LOCATION

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OLYMPIC LODGE 10 Mountain West Commercial | Office 801.456.8800 | www.mtnwest.com CITY

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AREA RETAIL Mountain West Commercial | Office 801.456.8800 | www.mtnwest.com 11 INCOME & EXPENSES

Income & Expenses YE 2017 % OF GR YE 2018 % OF GR YE 2019 % OF GR October 2020 YTD % of GR INCOME Rooms $3,779,727 90.72% $3,850,723 90.53% $4,089,942 90.08% $2,001,726 94.10% Resort Fee $138,040 3.31% $163,871 3.85% $183,093 4.03% $74,849 3.52% Cancellation Fees $27,480 0.66% $22,987 0.54% $36,472 0.80% $27,707 1.30% Miscellaneous $12,212 0.29% $6,607 0.16% $8,928 0.20% $2,914 0.14% Food & Beverage $206,690 4.96% $206,706 4.86% $217,428 4.79% $18,426 0.87% Meeting Room $2,416 0.06% $2,800 0.07% $4,514 0.10% $1,548 0.07% Gross Revenue $4,166,565 100.00% $4,253,694 93.69% $4,540,378 100.00% $2,127,170 99.93% Total Departmental Expenses $224,777 5.39% $209,617 4.93% $206,510 4.55% $109,614 5.15% Total Undistributed Expenses $1,864,781 44.76% $1,899,053 44.64% $1,899,101 41.83% $682,376 32.08% Total Fixed Expenses $370,197 8.88% $380,308 8.94% $411,222 9.06% $228,843 10.76% Total Expenses $2,459,755 59.04% $2,488,978 58.51% $2,516,833 55.43% $1,020,833 47.99% Net Operating Income $1,706,809 40.96% $1,764,716 41.49% $2,023,545 44.57% $1,106,337 52.01%

DETAILED EXPENSES YE 2017 % OF GR YE 2018 % OF GR YE 2019 % OF GR October 2020 YTD % of GR DEPARTMENTAL EXPENSES Rooms $224,777 5.39% $209,617 4.93% $206,510 4.55% $109,614 5.15% Food & Beverage Expense $0 0.00% $0 0.00% $0 0.00% $0 0.00% Total Departmental Expenses $224,777 5.39% $209,617 4.93% $206,510 4.55% $109,614 5.15% Undistributed Expenses Administration & General $552,878 13.27% $487,432 11.46% $403,475 8.89% $191,668 9.01% Salaries $881,237 21.15% $933,668 21.95% $1,024,566 22.57% $248,969 11.70% Marketing $103,759 2.49% $127,461 3.00% $134,527 2.96% $62,591 2.94% Utility costs $231,955 5.57% $205,865 4.84% $180,670 3.98% $122,018 5.74% Property Oper. & Maintenance $94,952 2.28% $144,627 3.40% $155,863 3.43% $57,130 2.69% Total Undistributed Expenses $1,864,781 44.76% $1,899,053 44.64% $1,899,101 41.83% $682,376 32.08% Fixed Expenses Property Taxes $45,750 1.10% $49,933 1.17% $50,493 1.11% $44,418 0.98% Capital Reserve $166,663 4.00% $170,148 4.00% $181,615 4.00% $85,087 4.00% Management Fee $124,997 3.00% $127,611 3.00% $136,211 3.00% $63,815 3.00% Insurance $32,788 0.79% $32,617 0.77% $42,902 0.94% $35,523 0.78% Total Fixed Expenses $370,197 8.88% $380,308 8.94% $411,222 9.06% $228,843 10.76% Total Expenses $2,459,755 59.04% $2,488,978 58.51% $2,516,833 55.43% $1,020,833 47.99%

OLYMPIC LODGE 12 Mountain West Commercial | Office 801.456.8800 | www.mtnwest.com HISTORICAL DATA

YE 2017 YE 2018 YE 2019 October 2020 YTD Rooms 105 105 105 105 Occupancy 62.40% 60.20% 63.80% 39.7% ADR $158.12 $167.06 $167.46 $157.62 RevPAR $98.67 $100.57 $106.84 $62.58 Room Revenue $3,779,727 $3,850,723 $4,089,942 $2,001,726

Occupancy ADR 70.0% $185.00 62.4% 63.8% 60.2% $167.06 $167.46 60.0% $170.00 $158.12 $157.62 $155.00 50.0% 39.7% $140.00 40.0% $125.00 30.0% $110.00 $95.00 20.0% $80.00 10.0% $65.00 0.0% $50.00 YE 2017 YE 2018 YE 2019 October 2020 YTD YE 2017 YE 2018 YE 2019 October 2020 YTD

Room Revenue RevPAR

$4,500,000 $4,089,942 $120.00 $106.84 $3,779,727 $3,850,723 $4,000,000 $98.67 $100.57 $100.00 $3,500,000

$3,000,000 $80.00 $2,500,000 $62.58 $2,001,726 $60.00 $2,000,000

$1,500,000 $40.00 $1,000,000 $20.00 $500,000

$0 $0.00 YE 2017 YE 2018 YE 2019 October 2020 YTD YE 2017 YE 2018 YE 2019 October 2020 YTD

Mountain West Commercial | Office 801.456.8800 | www.mtnwest.com 13 PROFORMA October 2020 YTD 2021

Occupancy 39.70% 50.1% Rooms Sold 15,215 19,201 Average Daily Rate $ 157.62 $ 165.00 REVPAR $ 62.58 $ 82.67

October 2020 YTD 2021 Total % of Tot Rev Total % of Tot Rev Revenue Rooms $ 2,001,726 94.10% $ 3,168,136 91.31% Resort Fee $ 74,849 $ 144,006 Cancellation Fees $ 27,707 $ 29,500 Miscellaneous $ 2,914 0.14% $ 3,001 0.09% Food & Beverage $ 18,426 0.87% $ 123,562 3.56% Meeting Room $ 1,548 0.07% $ 1,594 0.05% Total Revenue $ 2,127,170 100.00% $ 3,469,800 100.00%

Departmental Expenses Rooms $ 109,614 5.15% $ 190,839 5.50% Food & Beverage Expense $ - 0.00% 0.00% Total Departmental Expenses $ 109,614 5.15% $ 190,839 5.50%

Departmental Profit $ 2,017,556 94.85% $ 3,278,961 94.50%

Undistributed Operating Expenses Administration & General $ 191,668 9.01% $ 329,631 9.50% Sales & Marketing $ 62,591 2.94% $ 104,094 3.00% Salaries $ 248,969 11.70% $ 780,705 22.50% Property Operation & Maintenance $ 57,130 2.69% $ 121,443 3.50% Utilities $ 122,018 5.74% $ 142,262 4.10% Total Undistributed Expenses $ 682,376 32.08% $ 1,478,135 42.60%

Gross Operating Profit $ 1,335,181 62.77% $ 1,800,826 51.90%

Fixed Expenses Management Fee $ 63,815 3.00% $ 104,094 3.00% Property Taxes $ 44,418 2.09% $ 48,860 1.41% Insurance $ 35,523 1.67% $ 39,075 1.13% Capital Reserve $ 85,087 4.00% $ 138,792 4.00%

EBIDT $ 1,106,337 52.01% $ 1,470,005 42.37%

Mountain West Commercial | Office 801.456.8800 | www.mtnwest.com 14 5 YEAR CASH FLOW PROJECTIONS

YE 2021 YE 2022 YE 2023 YE 2024 YE 2025

Available Rooms 38,325 38,325 38,325 38,325 38,325 Rooms Sold 19,201 24,001 26,401 26,533 26,798 Occupancy 50.10% 62.63% 68.89% 69.23% 69.92% Average Daily Rate $ 165.00 $ 175.00 $ 183.75 $ 189.26 $ 194.94 REVPAR $ 82.67 $ 109.59 $ 126.58 $ 131.03 $ 136.31 Annual % Growth in REVPAR 32.58% 15.50% 3.52% 4.03% Revenue Rooms $ 3,168,136 91.31% $ 4,200,180 90.81% $ 4,851,208 91.28% $ 5,021,728 91.45% $ 5,224,104 91.64% Resort Fee $ 144,006 4.15% $ 180,008 3.89% $ 211,209 3.97% $ 212,265 3.87% $ 214,388 3.76% Cancellation Fees $ 29,500 0.85% $ 30,090 0.65% $ 30,692 0.58% $ 31,306 0.57% $ 31,932 0.56% Miscellaneous $ 3,001 0.09% $ 3,091 0.07% $ 3,184 0.06% $ 3,280 0.06% $ 3,378 0.06% Food & Beverage $ 123,562 3.56% $ 210,330 4.55% $ 216,640 4.08% $ 220,973 4.02% $ 225,392 3.95% Meeting Room $ 1,594 0.05% $ 1,642 0.04% $ 1,691 0.03% $ 1,725 0.03% $ 1,759 0.03% Total Revenue $ 3,469,800 100.00% $ 4,625,342 100.00% $ 5,314,625 100.00% $ 5,491,277 100.00% $ 5,700,953 100.00%

Departmental Expenses Rooms $ 190,839 5.50% $ 236,817 5.12% $ 260,417 4.90% $ 269,073 4.90% $ 285,048 5.00% Food & Beverage Expense $ - 0.00% 0.00% 0.00% 0.00% 0.00% Total Departmental Expenses $ 190,839 5.50% $ 236,817 5.12% $ 260,417 4.90% $ 269,073 4.90% $ 285,048 5.00%

Departmental Profit $ 3,278,961 94.50% $ 4,388,524 94.88% $ 5,054,208 95.10% $ 5,222,204 95.10% $ 5,415,906 95.00%

Undistributed Operating Expenses Administration & General $ 329,631 9.50% $ 432,469 9.35% $ 491,071 9.24% $ 505,197 9.20% $ 522,777 9.17% Sales & Marketing $ 104,094 3.00% $ 138,760 3.00% $ 159,439 3.00% $ 164,738 3.00% $ 171,029 3.00% Salaries $ 780,705 22.50% $ 1,040,702 22.50% $ 1,144,772 21.54% $ 1,179,115 21.47% $ 1,214,489 21.30% Property Operation & Maintenance $ 121,443 3.50% $ 161,887 3.50% $ 186,012 3.50% $ 192,195 3.50% $ 199,533 3.50% Utilities $ 142,262 4.10% $ 187,326 4.05% $ 214,977 4.05% $ 222,397 4.05% $ 230,319 4.04% Total Undistributed Expenses $ 1,478,135 42.60% $ 1,961,145 42.40% $ 2,196,271 41.33% $ 2,263,642 41.22% $ 2,338,147 41.01%

Gross Operating Profit $ 1,800,826 51.90% $ 2,427,379 52.48% $ 2,857,937 53.77% $ 2,958,562 53.88% $ 3,077,759 53.99%

Fixed Expenses Management Fee $ 104,094 3.00% $ 138,760 3.00% $ 159,439 3.00% $ 164,738 3.00% $ 171,029 3.00% Property Taxes $ 48,860 1.41% $ 210,000 4.54% $ 220,500 4.15% $ 231,525 4.22% $ 243,101 4.26% Insurance $ 39,075 1.13% $ 41,029 0.89% $ 43,080 0.81% $ 45,234 0.82% $ 47,496 0.83% Capital Reserve $ 138,792 4.00% $ 185,014 4.00% $ 212,585 4.00% $ 219,651 4.00% $ 228,038 4.00%

EBIDT 1,470,005 42.37% 1,852,576 40.05% 2,222,333 41.82% 2,297,413 41.84% 2,388,095 41.89%

Total Expenses $ 1,999,795 $ 2,772,765 $ 3,092,291 $ 3,193,864 $ 3,312,858

Mountain West Commercial | Office 801.456.8800 | www.mtnwest.com 15 5 YEAR IRR ANALYSIS

ACQUISITION CRITERIA MORTGAGE Purchase Price: $23,000,000 MORTGAGE AMOUNT: $14,950,000 PIP 1st Deed LTV 65.00% Project Cost $23,000,000 First Trust Deed: $14,950,000 LTV: 65.00% Interest: 5.00% Franchise Transfer Fee: $0 Amortization: 25 Equity: $8,050,000 Monthly Debt Service: 87,396 Price/Key: $219,048 Annual Debt Service: 1,048,755 Year 1 CAP Rate on Project Cost: 6.39% TOTAL DEBT SERVICE: $1,048,755 Year 1 RRM on Project Cost: 7.26 YEARLY MORTGAGE SUMMARY First Deed: YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 Beginning Balance: ($14,950,000) ($14,604,654) ($14,242,040) ($13,861,296) ($13,461,514) Principal Reduction: 345,346 362,614 380,744 399,781 419,771 Ending Balance: ($14,604,654) ($14,242,040) ($13,861,296) ($13,461,514) ($13,041,744) YEARLY CASH FLOW SUMMARY YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 OPERATING SUMMARY: Average Daily Rate: $165.00 $175.00 $183.75 $189.26 $194.94 Occupancy: 50.10% 62.63% 68.89% 69.23% 69.92% RevPAR: $82.67 $109.59 $126.58 $131.03 $136.31 Room Revenue: $3,168,136 $4,200,180 $4,851,208 $5,021,728 $5,224,104 Other Revenue: 301,664 425,161 463,416 469,548 476,849 Total Revenue: $3,469,800 $4,625,342 $5,314,625 $5,491,277 $5,700,953 Total Expenses: $1,999,795 $2,772,765 $3,092,291 $3,193,864 $3,312,858 Operating Margin: 42.37% 40.05% 41.82% 41.84% 41.89% NET OPERATING INCOME: $1,470,005 $1,852,576 $2,222,333 $2,297,413 $2,388,095 DEBT SERVICE: Cash on Cash: $421,250 $803,822 $1,173,579 $1,248,658 $1,339,341 Cash on Cash %: 5.23% 9.99% 14.58% 15.51% 16.64% Debt Coverage Ratio: 1.40 1.77 2.12 2.19 2.28 Principal Reduction (First Trust): 345,346 362,614 380,744 399,781 419,771

Total Return: $766,597 $1,166,435 $1,554,323 $1,648,440 $1,759,111 Total Return %: 9.52% 14.49% 19.31% 20.48% 21.85% Cap Rate 6.39% 8.05% 9.66% 9.99% 10.38% CAPITAL GAIN CALCULATION YEAR 5 Year 5 Net Operating Income: $2,388,095 CAP Rate OLYMPIC at Year 5: LODGE 9.00% Disposition Price: $26,534,389 16 Mountain West Commercial | Office 801.456.8800 | www.mtnwest.com Remaining First Mortgage Balance: (13,041,744) Return of Equity: 8,050,000 Capital Gain and Principal Reduction: $5,442,645 Price/Key: $252,708 RRM at Year 5: 5.08 LEVERAGED IRR ANALYSIS YEAR 0 YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 Purchase Price: ($23,000,000) Debt: 14,950,000 Cash on Cash: 421,250 803,822 1,173,579 1,248,658 1,339,341 Disposition: 26,534,389 Remaining First Mortgage Balance: (13,041,744) Annual Return: ($8,050,000) $421,250 $803,822 $1,173,579 $1,248,658 $14,831,986 FIVE YEAR LEVERAGED IRR: 20.34% Average Cash on Cash Return: 12.39% Average Total Return: 17.13% Payback Period (Years): 7.3 UNLEVERAGED IRR ANALYSIS YEAR 0 YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 Purchase Price: ($23,000,000) Net Operating Income: 0 1,470,005 1,852,576 2,222,333 2,297,413 2,388,095 Disposition: 26,534,389 Annual Return: ($23,000,000) $1,470,005 $1,852,576 $2,222,333 $2,297,413 $28,922,484 FIVE YEAR UNLEVERAGED IRR: 11.14% Average CAP Rate: 8.90% ACQUISITION CRITERIA MORTGAGE Purchase Price: $23,000,000 MORTGAGE AMOUNT: $14,950,000 PIP 1st Deed LTV 65.00% Project Cost $23,000,000 First Trust Deed: $14,950,000 LTV: 65.00% Interest: 5.00% Franchise Transfer Fee: $0 Amortization: 25 Equity: $8,050,000 Monthly Debt Service: 87,396 Price/Key: $219,048 Annual Debt Service: 1,048,755 Year 1 CAP Rate on Project Cost: 6.39% TOTAL DEBT SERVICE: $1,048,755 Year 1 RRM on Project Cost: 7.26 YEARLY MORTGAGE SUMMARY First Deed: YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 Beginning Balance: ($14,950,000) ($14,604,654) ($14,242,040) ($13,861,296) ($13,461,514) Principal Reduction: 345,346 362,614 380,744 399,781 419,771 Ending Balance: ($14,604,654) ($14,242,040) ($13,861,296) ($13,461,514) ($13,041,744) YEARLY CASH FLOW SUMMARY YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 OPERATING SUMMARY: Average Daily Rate: $165.00 $175.00 $183.75 $189.26 $194.94 Occupancy: 50.10% 62.63% 68.89% 69.23% 69.92% RevPAR: $82.67 $109.59 $126.58 $131.03 $136.31 Room Revenue: $3,168,136 $4,200,180 $4,851,208 $5,021,728 $5,224,104 Other Revenue: 301,664 425,161 463,416 469,548 476,849 Total Revenue: $3,469,800 $4,625,342 $5,314,625 $5,491,277 $5,700,953 Total Expenses: $1,999,795 $2,772,765 $3,092,291 $3,193,864 $3,312,858 Operating Margin: 42.37% 40.05% 41.82% 41.84% 41.89% NET OPERATING INCOME: $1,470,005 $1,852,576 $2,222,333 $2,297,413 $2,388,095 DEBT SERVICE: Cash on Cash: $421,250 $803,822 $1,173,579 $1,248,658 $1,339,341 Cash on Cash %: 5.23% 9.99% 14.58% 15.51% 16.64% 5Debt YEAR Coverage Ratio: IRR ANALYSIS 1.40 1.77 2.12 2.19 2.28 Principal Reduction (First Trust): 345,346 362,614 380,744 399,781 419,771

Mountain West Commercial | Office 801.456.8800 | www.mtnwest.com 17 AREA OVERVIEW

PORT ANGELES, WA Port Angeles is the county seat of Clallam County, Washington, United States. With a population of 19,038 as of the 2010 census, it is the largest city in the county. The population was estimated at 20,229 in 2019 by the Office of Financial Management. Port Angeles is home to Peninsula College.

The City’s harbor was dubbed Puerto de Nuestra Señora de los Ángeles (Port of Our Lady of the Angels) by Spanish explorer Francisco de Eliza in 1791. By the mid-19th century, after settlement by English speakers from the United States, the name was shortened and partially anglicized to its current form, Port Angeles Harbor.

The city is situated on the northern edge of the Olympic Peninsula along the shore of the Strait of Juan de Fuca. Port Angeles features a long and narrow glacial morraine named Ediz Hook that projects north-easterly nearly three miles into the Strait. Ediz Hook creates a large, natural deep-water harbor shielded from the storms and swells that move predominantly eastward down the Strait from the Pacific Ocean. Coast Guard Air Station / Sector Field Office (SFO) Port Angeles is situated on the end of Ediz Hook. The harbor is deep enough to provide anchorage for large ocean-going ships such as tankers and cruise ships. The south shore of Vancouver Island and the city of Victoria, British Columbia are visible across the Strait to the north.

18 OLYMPIC LODGE Mountain West Commercial | Office 801.456.8800 | www.mtnwest.com Photo Source: offthebeatenpath.com DEMOGRAPHICS

POPULATION

1 MILE 20,248 2020 EST. POPULATION

1 MILE 21,197 2025 EST. POPULATION

HOUSEHOLDS & MEDIAN INCOME

1 MILE 9,192 2020 EST. HOUSEHOLDS

1 MILE $52,420 2020 EST. INCOME

Photo Source: portofpa.com Mountain West Commercial | Office 801.456.8800 | www.mtnwest.com 19 OLYMPIC LODGE

140 S. DEL GUZZI DR. PORT ANGELES, WA 98362 PREPARED BY MICHAEL FRANCIS [email protected] direct 801.704.1669 View Profile

WES CHRISTENSEN [email protected] direct 801.704.1662 View Profile

NICHOLAS DIAMOND Capacity Commercial Group [email protected] direct 503.222.2655

312 East South Temple, Salt Lake City, UT 84111 Office 801.456.8800 | www.mtnwest.com