Strategic Location on Interstate 35. The Property is strategically located just off Interstate 35, directly behind both San Marcos Premium Outlets and Tanger Outlets; featuring 240 designer and name brands stores spread out over 1.2 million square feet of shopping heaven that attract approximately 14 million visitors annually. The outlet mall complex is consistently ranked among the top five most popular tourist attractions in Texas. Texas State University, located four miles from the Property, is the fourth largest university in the state of Texas with an enrollment of over 38,000 students for the 2017 fall semester.
Strong Pro Forma Projection. Based on TTM October 2017, the comp. set is operating at an average RevPAR of $70.86, with the leaders being the 108-room Fairfield Inn & Suites Austin San Marcos at $76.43 RevPAR and 108-room Holiday Inn San Marcos San Marcos at $74.74 RevPAR. Looking at the STR report, the submarket: San Marcos/Austin Surrounding, TX has seen a 4.6% increase in demand on YTD October 2017, showing the continued growth in the area. Being the nicest and newest product in the market, the Hotel is expected to quickly ramp up and perform at a $70.95 RevPAR in 2018, leading to $2,201,224 in room revenue and $722,323 net operating income.
Replacement Cost Investment. Based on the seller’s construction budget, the replacement cost for this Hotel is more than $107,000 per room. Given the current pricing guidance, this offering presents an investor an excellent opportunity to acquire the Property for replacement cost without having to go through the development process.
Growing La Quinta Brand with Del Sol Prototype. The new Del Sol prototype is part of La Quinta’s overall business strategy to innovate for the benefit of their guests and hotel owners. The use of bold shapes, colors and textures creates unique and distinctive elevations on the exterior. The adaptable and scalable footprint optimizes the site and fully maximizes ROI potential. Currently, La Quinta has a construction pipeline of 252 franchise hotels, which represents a 28% increase in total supply showing a significant growth opportunity for the brand.
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Michael Yu and Yu Hospitality Real Estate Advisors, Inc. are licensed real estate brokers in the state of Texas. Rahul Bijlani, Eric Guerrero, Tyler Bean, Andrew Frosch, Dennis Drake, Agrama Mannapperuma and Pravin Boteju are licensed salespersons in the state of Texas and affiliated with and sponsored by CBRE Group Inc.