lodging supply and demand analysis

Transcription

DOWNTOWN HOTEL MARKET ANALYSIS
CITY OF ABILENE, TX
August 8, 2013
© Copyright 2013 Alvarez & Marsal Holdings, LLC. All rights reserved. ALVAREZ & MARSAL®,
® and A&M® are trademarks of Alvarez & Marsal Holdings, LLC.
August 8, 2013
Mr. Richard Burdine
Chief Executive Officer
Development Corporation of Abilene, Inc.
174 Cypress Street, Suite 301
Abilene, TX 79601
Dear Mr. Burdine:
The accompanying report, City of Abilene, Texas, Downtown Hotel Market Analysis, has been prepared pursuant to
our engagement letter dated May 21, 2013.
The information reported and related analyses and recommendations herein are based on estimates, assumptions
and other information gathered from our selective interviews with local area lodging industry experts and
representatives of comparable lodging developments, research of the defined competitive/comparable market and
knowledge of the hospitality and real estate industry. The sources of information and bases for the assumptions are
stated herein. While we believe that the sources of information are reasonable and reliable, Alvarez & Marsal Real
Estate Advisory Services, LLC (“A&M”) has not, as part of this engagement, performed an audit or review of any of
the financial and market information used and therefore does not express an opinion or any other form of assurances
on the accuracy of such information.
Since our recommendations and conclusions are based on estimates and assumptions that are inherently subject to
uncertainty and variation depending on evolving events, we do not represent them as results that will or will not be
achieved. Some assumptions inevitably will not materialize, and unanticipated events and circumstances may occur;
therefore, the actual results achieved may vary materially from the examples and conclusions herein.
The terms of our engagement did not provide for reporting on events and transactions that occurred subsequent to
our fieldwork completed on May 31, 2013.
1
Our report is intended solely for your use. It should not be relied upon for any other purpose, or by any other entity.
However, it is understood that the City of Abilene, Texas (“Abilene”, the “City” or the “Client”) may have outside
partners, advisors, sophisticated funding sources and regulatory agencies involved in this transaction. It is the
Client’s responsibility to inform all such parties of the terms and conditions of this engagement and, as such, all such
parties will be subject to the terms and conditions stated herein.
Sincerely,
Embree C. Bedsole
Managing Director – Global Leader
Alvarez & Marsal Real Estate Advisory Services, LLC
Hospitality & Leisure Group
2
TABLE OF CONTENTS
I.
Introduction, Methodology and Approach
4
II. Executive Summary
7
III. General Market Overview
4
IV. Project Description, Area and Site Analysis
23
V. Lodging Supply and Demand Analysis
34
VI. Performance Estimates
70
VII. Convention Overflow Analysis
75
VIII. 5-Year Cash Flow Estimates
79
IX. Facilities and Services Recommendations
85
X. Appendix
91
3
INTRODUCTION, METHODOLOGY
AND APPROACH
4
INTRODUCTION, METHODOLOGY AND APPROACH
Introduction
The City is considering the feasibility of a new downtown hotel near the current civic center (the “Proposed Hotel”).
This consideration is based on growing commercial and leisure demand for lodging facilities in Abilene and the region.
Accordingly, the City has requested A&M to prepare this proposal to help determine the market potential of the
Proposed Hotel and the impact on other hotels in Abilene from additional conferences/conventions that the Proposed
Hotel would be able to attract.
Methodology and Approach
General Project and Market Information
– Met with city representatives to obtain a further understanding of the Client’s goals and objectives related to the
Proposed Hotel and conducted inspections of several sites suitable for the development of the Proposed Hotel.
– Assembled, read and analyzed economic and demographic data pertaining to the defined market area (“DMA”)
to evaluate the present economic climate and to estimate future growth potential, particularly as it relates to
lodging demand. For the purposes of our analysis, the DMA was limited to Abilene, TX.
– Interviewed key local government and tourism industry representatives regarding the area’s economic base,
population and employment trends, tourism, visitation count, proposed additions to lodging supply, recent hotel
developments and potential impact of a new development on the local community and DMA.
– Evaluated the existing and proposed infrastructure enhancements and transportation systems to determine the
degree to which transportation access might affect the marketability of the Proposed Hotel.
– Summarized in-house and published information on the existing lodging market performance in the DMA.
Lodging Supply and Demand Analysis
– Identified hotels in the DMA that are considered to be the most comparable to the Proposed Hotel’s initial
concept.
– Given the absence of directly comparable hotels in the DMA, and the unique characteristics of the Proposed
Hotel, A&M expanded its selection criteria to include hotels in regional markets including Lubbock, Waco,
Midland and Amarillo.
5
INTRODUCTION, METHODOLOGY AND APPROACH
Lodging Supply and Demand Analysis – cont’d
– On a best efforts basis, interviewed representatives of the selected comparable projects to obtain pertinent
performance information and statistics.
– Conducted interviews with selected representatives of major local demand generators to assess current
demand and demand growth estimates.
– Using information obtained from government and market representatives, identified other lodging projects in the
DMA that are planned or under construction that may compete with the Proposed Hotel.
– Formulated a demand profile and occupancy and average daily rate estimates for the Proposed Hotel,
incorporating the economic and demographic data, competitive supply, and the site-specific nuances, as
applicable.
– Prepared cash flow estimates for the Proposed Hotel’s first five years of operation.
Project Facilities and Amenities
– Based on our findings in previous tasks, A&M prepared recommendations for facilities that, in our opinion, best
meet market demand, including:
» Lodging component, more specifically hotel sizing and overall quality level; and
» Related services and amenities, including recreational facilities.
Market Analysis Report
– Upon completion of the aforementioned tasks, A&M summarized its research and findings in this presentationstyle report with charts, tables and supporting bullets.
6
EXECUTIVE SUMMARY
7
EXECUTIVE SUMMARY
Our market research and analysis substantiates the notion that there is sufficient market support for the Proposed
Hotel located in Downtown Abilene. More specifically, the Proposed Hotel is envisioned to be a branded, 250-room
upper-upscale hotel, offering higher quality facilities, amenities and services than currently available in the local
market. Given its location adjacent to the Abilene Civic Center (“ACC”), the Proposed Hotel is anticipated to
complement the meeting facilities offered by the ACC, increase the demand for convention activity and further
revitalize the downtown area.
Key Lodging Market Trends and Characteristics
• The City is serviced by a total of 43 hotels, which are primarily economy and midscale properties as classified by
Smith Travel Research (“STR”), and represent approximately 70 percent of the total lodging market inventory. Only
three hotels make up the upscale segment and include the Courtyard by Marriott, the Hilton Garden Inn and the
Residence Inn, however these hotels offer limited-service facilities and amenities. The Proposed Hotel is
anticipated to be the only hotel in the city offering a full-service, upscale lodging product. A copy of the 2013 STR
U.S. Lodging Chain Scale table is included in the Appendix section of this report.
• The City’s lodging demand measured by the number of occupied room nights, experienced a Compound Annual
Growth Rate (“CAGR”) of 2.5 percent between 2007 and 2012. Furthermore, 2011 and 2012 demand levels were
higher than the peak levels reported in 2008 and YTD results as of May 2013 indicate lodging demand is five
percent higher than 2012 results for the same period.
• Despite the improved demand results, market wide occupancies have experienced a lagging recovery given the
high supply levels recorded, which increased at a CAGR of 6.6 percent between 2007 and 2012. This growth in
room night accommodations diluted the effect from higher demand and drove occupancies below 50 percent in
2010. It is important to note however, that although these supply shifts impact the market as a whole, they took
place in the economy, limited-service segment, which will not be the target of the Proposed Hotel. Moving forward,
the market appears to have entered a correction period as lodging supply has remained stable over the last two
years and with increasing demand, occupancies should begin to trend upward.
8
EXECUTIVE SUMMARY
Key Lodging Market Trends and Characteristics – cont’d
• In 2011, Average Daily Rate (“ADR”) increased 3.8 percent over 2010 as a result from the increased demand levels
experienced from emergency responders fighting the Texas wildfires, and insurance adjusters addressing hail
damage in the area during that year.
• Unlike demand levels which declined in 2012 following a record year, ADR in 2012 was able to maintain growth,
increasing from $72.96 to $73.62 or approximately one percent over 2011. This nominal ADR growth may be
partially attributable to the decrease in government per diems from $85 to $77 in 2011 as government accounts
represent an important source of demand for local hotels particularly given the proximity of the Dyess Air Force
Base to the city.
• The City believes that it is currently constrained in its ability to book conventions that would fully utilize the ACC due
to a lack of adequate lodging inventory with sufficient meeting space to accommodate group business demand in
the downtown area. The Abilene Convention & Visitors Bureau (“ACVB”) reports that it is losing a significant
amount of convention business (an average of $1.8 million per year since 2007) to other cities in the region, such
as Midland, Lubbock and Waco, that offer a sizeable hotel room inventory located adjacent to, or in close proximity
to, their convention centers.
9
EXECUTIVE SUMMARY
Occupancy Analysis
A&M estimated future occupancy levels for the Proposed Hotel based on the penetration levels in each market
demand segment relative to its competitors. Penetration is calculated by dividing the number of room nights captured
by the Proposed Hotel by its fair share. Fair share represents the percentage of the Proposed Hotel’s number of
rooms in relation to the total number of rooms in the comparable market. The ratio is then multiplied by the market’s
total estimated room nights by market segment to calculate the Proposed Hotel’s fair share of room nights.
Our occupancy estimates are further based on the Proposed Hotel’s anticipated advantages and disadvantages
relative to the comparable hotels, and the assumption that it will be operated and branded by an internationally
recognized hotel company.
Since the Proposed Hotel will be located next to or near the ACC, it is anticipated to cater primarily to the convention
and meetings business. Given the fact that it will include a fair amount of on-site meeting and function space to
complement the ACC’s facilities, the Proposed Hotel’s penetration of the group demand segment is forecasted above
its fair share in 2016. As operations ramp up and group business bookings increase, the Proposed Hotel’s penetration
is estimated to increase through 2019 when the group segment is forecasted to account for 40 percent of the
Proposed Hotel’s market mix.
Corporate and government demand represent the primary source of business for local hotels and the Proposed Hotel
is anticipated to successfully secure corporate negotiated accounts given its strategic location and more upscale
product offering. In addition, the construction of the Proposed Hotel is reportedly being supported by a number of local
businesses that have expressed interest in directing business to the Proposed Hotel upon opening. As such, the
corporate segment is anticipated to account for 32 percent of the Proposed Hotel’s market mix upon stabilization.
Downtown’s revival as a cultural and entertainment district should also allow the Proposed Hotel to capture a fair
amount of visitors to the area. Consistent with the seasonality trends experienced by local hotels, leisure demand
should help the Proposed Hotel offset the departure of corporate and group business towards the end of the week.
Therefore, we have forecasted the leisure segment to represent 28 percent of the Proposed Hotel’s market
segmentation.
10
EXECUTIVE SUMMARY
Occupancy Analysis – cont’d
The estimated occupancies for the Proposed Hotel are
calculated by dividing the estimated total number of room nights
captured, by its available number of room nights per year. The
Proposed Hotel is anticipated to stabilize in 2019, its fourth year
of operations, following an estimated 24-month development
and pre-opening process with a target opening date of January
2016.
The opening of the Proposed Hotel will bring to the market a
type of lodging product that currently does not exist in the city.
Given its new facilities and expanded meeting space offering,
coupled with the anticipated strong marketing efforts from the
ACVB, the Proposed Hotel will attract additional room nights
(induced demand) in addition to the market’s existing base
demand.
Proposed Hotel - Downtown Abilene
Estimated Occupancy, Overall Penetration and Market Share (2016-2020)
Calendar Years
2016
2017
2018
2019
2020
Room Nights Captured
51,379
53,177
56,623
57,983
58,734
Available Room Nights
91,250
91,250
91,250
91,250
91,250
Rounded Occupancy
56%
58%
62%
64%
64%
Overall Penetration
91%
92%
95%
95%
95%
Overall Market Share
27%
28%
28%
28%
28%
Source: A&M
Average Daily Rate Estimates
ADR for the Proposed Hotel was estimated based on its
positioning within the local comparable market as well as the
rate trends experienced by the regional comparable hotels.
Given its strategic location and anticipated product quality, the
Proposed Hotel is estimated to command ADR premiums over
its local competitors and be positioned in line with the regional
comparable hotels upon stabilization, when the Proposed Hotel
is estimated to achieve an ADR of $126.00 in constant 2013
Dollars.
Estimated Future Occupancy and Average Daily Rate (2016 - 2020)
Average Daily Rate
Estimated
Constant
Occupancy
2016
2017
2013 Dollars
2013 Dollars
Inflated
Dollars (1)
56%
$118
$129
$66
$73
58%
$121
$136
$70
$79
2018
62%
$123
$143
$76
$89
2019
64%
$126
$150
$80
$95
2020
64%
$126
$154
$81
$99
Year
(1)
RevPAR
Inflated
Dollars (1)
Constant
Inflation assumed at 3.0 percent per annum.
Source: A&M
11
EXECUTIVE SUMMARY
Convention Demand Overflow Analysis
In order to calculate convention demand overflow, A&M assumed that 30 percent of the total potential convention
room nights identified by the ACVB (69,163) could be secured if the Proposed Hotel was developed. This estimate is
based upon the finding that approximately one third of the convention room nights are lost due to the lack of a hotel
adjacent to the ACC (additional details are provided in the Convention Overflow Analysis section of the report). The
ACVB indicated that it has developed and maintains good relationships with the majority of the meeting planners that
organize the identified events. As a result, the ACVB feels confident in its ability to book the vast majority of them.
Despite the aforementioned, we have made the conservative assumption that not every one of these events will be
booked as the meeting planners may have other considerations outside the lack of a downtown hotel to book their
groups in alternative destinations.
Based on the assumed booking rate of 30 percent, the potential number of room nights that could be brought to the
market and contribute overflow business to the hotels in the local Comp Set was estimated at 20,749.
As illustrated in the table below, the occupancy levels in the local Comp Set were estimated at 62 percent in 2016, the
assumed opening year for the Proposed Hotel. Such decrease is nine percentage points below the Comp Set’s
estimated 2012 occupancy of 71 percent, excluding the Proposed Hotel. Assuming each hotel would capture its fair
share of the estimated overflow demand, overall Comp Set occupancies would increase to approximately 70 percent,
offsetting the effects of the additional supply brought by the Proposed Hotel.
Abilene Lodging Market
Convention Business Overflow Analysis
Number of
Rooms
Available
Room Nights
Fair Share
Estimated
2012
Occupancy
Courtyard by Marriott
100
36,600
13%
60%
55%
20,130
2,712
22,842
62%
MCM Elegante Suites
175
64,050
23%
70%
63%
40,352
4,746
45,098
70%
Hilton Garden Inn Abilene
123
45,018
16%
75%
68%
30,612
3,336
33,948
75%
Residence Inn Abilene
117
Proposed Hotel
250
OVERALL COMP SET
765
42,822
91,500
279,990
15%
33%
100%
78%
N/A
71%
71%
56%
62%
30,404
51,240
172,737
3,173
6,781
20,749
33,577
58,021
193,486
78%
63%
69%
Hotel
Estimated
2016
Overflow
Adjusted
Adjusted
2016
Occupied
(Room Nights Occupied
2016
Occupancy Room Nights
Captured)
Room Nights Occupancy
Source: A&M
12
EXECUTIVE SUMMARY
The Proposed Hotel should offer facilities and a range of services and amenities commensurate with the standards of
an upper-upscale, full-service lodging brand. It will cater to small and mid-size groups as its core business, with the
potential to accommodate events of up to 1,000 people, while also relying on the corporate transient segment.
Furthermore, the Proposed Hotel will rely on leisure guests and demand associated with local universities to support
its operation during off-peak periods and weekends. Based on the anticipated type and product quality of the
Proposed Hotel, as well as the target market (group and convention demand) and its proximity to the ACC, our
recommended facilities and amenities are as follows:
• 240 standard rooms of approximately 360 to 380 square feet (“SF”) and 10 executive suites of approximately 760
SF;
• A full-service restaurant open for breakfast, lunch and dinner service, and offering a casual dining experience;
• A lounge/bar area opened from afternoon to late evening and featuring a limited food menu, several televisions,
and an evening wine/social hour;
• +12,000 SF of meeting space including a main ballroom and configurable breakout rooms in addition to +1,200 SF
of pre-function space;
• Banquet and catering service;
• In-room dining service;
• A 24-hour, full-service business center;
• A 24-hour fitness facility; and
• An outdoor swimming pool.
13
GENERAL MARKET OVERVIEW
14
General Overview
Abilene is the county seat of Taylor County, located in West Central Texas, near the geographic center of the state.
The City was established in 1891 by cattlemen as a shipping point on the Texas & Pacific Railway and is the center of
a 22-county region often referred to as the Texas Midwest or the Big Country. Abilene is located approximately 180
miles west of Dallas/Fort Worth and approximately 230 miles northwest of Austin. It comprises an area of 110.7
square miles and features a generally flat terrain. Year-round temperatures range between 32 and 95 degrees
Fahrenheit in the months of January and July respectively, with an average humidity of 59%. The Abilene Metropolitan
Statistical Area (“MSA”) includes all of Taylor, Jones, and Callahan counties.
Location Map of Abilene, TX
15
Road Network
Abilene is well connected east-west via U.S. Interstate 20, north-south via U.S. highways 83, 84 and 277, and by a
number of state highways. Downtown Abilene is split by I-20 Business (east-west running), which parallels the Union
Pacific railroad tracks. The regional roadway system is adequate for visitor access to the city, with many roads
terminating or joining the loop around Abilene created by I-20, Winters Freeway (U.S. Highway 83-84), and Jake
Roberts Freeway (State Spur 322). The city is the center of “The Big Country” trade area, which can generally be
delineated by the intrastate highway system that intersects through Abilene.
Abilene’s Road Network
16
Population
According to ESRI Business Analyst, the population of Abilene proper was 117,063 in 2010 and an estimated 118,365
in 2012. As of the 2010 Census, the Abilene MSA had a total population of 165,578, which represented a modest
increase of 3.1 percent over the 2000 Census figures (160,245) and a low CAGR of 0.31 percent. Forward projections
by the Texas State Data Center (“TSDC”) estimate that the total population of the MSA will be 176,581 in 2020 while
the Texas Water Development Board (“TWDB”) estimates a total population of 177,354 for the same year. These
forecasts represent a cumulative increase of 6.6 percent and 4.1 percent over 2010 population figures, respectively,
anticipating a faster paced population growth over the 2010-2020 decade. Beyond 2020, the population estimates
from both the TSDC and TWDB begin to diverge significantly mainly because the TSDC projection assumes a
moderate positive migration rate in addition to the natural growth of the existing population, whereas the TWDB shows
a flattening of the MSA growth. The table below illustrates the projected population growth through 2050 for the
Abilene MSA.
Abilene MSA
Projected Population (2015-2040)
%
Change
Texas Water
Development
Board
% Change
165,578
-
170,410
-
171,268
3.4%
-
-
2020
176,581
3.1%
177,354
4.1%
2025
181,210
2.6%
-
-
2030
185,363
2.3%
180,079
1.5%
2035
189,001
2.0%
-
-
2040
192,180
1.7%
180,387
0.2%
2045
195,016
1.5%
-
-
2050
197,485
1.3%
176,716
-2.0%
Year
Texas State Data
Center
2010
2015
Sources: Texas State Data Center; Texas Water Development Board
17
Key Demographics
According to ESRI Business Analyst, the median age of the city’s population in 2012 was 32.1, 2.7 years younger
than the Abilene MSA median, and 1.7 years younger than the state median. Interestingly, the trade region
surrounding the city has a median age 5.7 years older than the median age of the city’s population, indicating a
concentration of younger generations in the city. The average household size in Abilene in 2012 was 2.47 persons,
lower than the statewide size of 2.75. Abilene’s average family size totaled 3.04 persons, again lower than the state
average of 3.31.
Approximately 91 percent of the 43,953 total housing units in Abilene were occupied in 2012, which is higher than
the state average of 89.6 percent during the same year. Of those occupied units, 51 percent were owner-occupied
in Abilene, which is lower than the ownership rates of 56.2 percent in the greater Abilene MSA and 56.1 percent in
Texas. This may be partly due to the concentration of higher education institutions in the City which contribute to the
higher percentage of renter occupied units in the market.
Demographic Analysis
2012 Estimates
City of Abilene
Abilene MSA
"The Big Country"
Texas
Total Population
118,365
167,456
414,841
25,906,038
Households
43,953
62,801
155,571
9,191,344
Average Household Size
2.47
2.50
2.48
2.75
Average Family Size
3.04
3.03
3.01
3.31
Median Age
32.1
34.8
37.8
33.8
Vacant Housing Units
Owner Occupied Housing Units
Renter Occupied Housing Units
Median Household Income
9.1%
11.0%
17.8%
10.4%
51.0%
56.2%
55.0%
56.1%
40.0%
32.8%
27.1%
33.5%
$38,519
$39,173
$37,052
$47,622
Source: ESRI Business Analyst Online
18
Key Demographics – cont’d
The age distribution of the population in a market area provides an indication of the probable spending patterns in
locally generated goods and services including housing, education, healthcare and retail sales. In the Abilene MSA,
the 25- to 34-year-old cohort is the overall largest with a total of 23,331, and this cohort is projected to experience an
increase of 3.6 percent over the next five years. The age groups between 55 and 85+ are expected to experience the
largest growth by 2017 at 12.2 percent, with the 65- to 74-year-old cohort forecasted to grow by 23.2 percent.
Growth in the 25- to 34-year-old cohort is likely to contribute to increased housing and retail sales, in addition to
higher demand for entertainment and family-oriented attractions. Similarly, the 55- to 64-year-old bracket generally
has among the highest levels of disposable income and potentially represents one of the demographics to contribute
the most to the overall economic activity in Abilene.
Abilene MSA
Population Distribution by Age (2012-2017)
25,000
Number of People
20,000
15,000
10,000
5,000
0
0-4
2012 11,682
2017 12,047
5-9
10,848
11,115
10 - 14
10,362
10,735
Source: ESRI – Business Analyst
15 - 19
11,836
11,651
20 - 24
16,044
15,357
25 - 34
23,331
24,169
35 - 44
18,752
18,806
45 - 54
21,947
20,905
55 - 64
18,881
20,249
65 - 74
12,814
15,790
75 - 84
7,790
8,420
85+
3,169
3,416
Age Bracket
19
Employment
Abilene Economic Indicators
Top Ten Employers (2012)
Abilene enjoys a diversified economy, with roots in ranching, oil and
gas, and concentrated employment centers in the military,
government, healthcare and education industry segments. According
to the Abilene Industrial Foundation, Dyess Air Force Base
represents Abilene’s largest employer with over 5,400 military and
civilian employees. Hendrick Health System represents the largest
private sector employer with 2,869 employees. The Abilene
Independent School District ranks as the third largest employer at
2,413. Higher education remains an important employment sector for
Abilene. Abilene Christian University, Hardin-Simmons University,
McMurry University, and satellite campuses of Cisco Junior College,
Texas Tech University and Texas State Technical College provide
steady jobs for a combined 1,828 employees.
According to the Texas Workforce Commission, as of April 2013 total
non-agricultural employment in the Abilene MSA grew by an
estimated 2,800 jobs or 2.1 percent compared to the same period
last year. This growth was primarily driven by increases in
Professional & Business Services, Leisure & Hospitality, Mining,
Logging and Construction, which added a combined 1,400 jobs over
April 2012 figures. Although the rate of employment growth in the
Abilene MSA is below the state’s average of 3.1 percent, the
unemployment rate is reportedly one of the state’s lowest at 4.8
percent, only above the rate experienced by the Midland, Odessa
and Amarillo MSAs as of April 2013. During the same period,
unemployment rate for Texas and the U.S. stood at 6.1 and 7.1
percent, respectively. These figures evidence the City’s strong local
employment, further reflected by our interviews with economic
development officials which forecast a positive outlook for the area.
Rank
Employer
Number of
Employees
1
Dyess Air Force Base
2
Hendrick Health System
5,406
2,869
3
Abilene ISD
2,413
4
Abilene State Supported Living Center
1,472
5
City of Abilene
1,200
6
TX Dept. of Criminal Justice
1,128
7
BlueCross BlueShield of Texas
1,050
8
Abilene Christian University
772
9
Abilene Regional Medical Center
750
10
Teleperformance USA
600
Source: Abilene Industrial Foundation
Source: Texas Workforce Commission
20
Visitation
According to the Office of the Governor, Economic Development and Tourism Division, total visitation to the Abilene
MSA increased from 2.84 million visitors in 2009 to 3.2 million visitors in 2011, or 12.7 percent. The MSA’s visitor profile
is largely regional in nature and is characterized by short stays. Reportedly, approximately 70 percent of visitors who
traveled to the Abilene MSA in 2011 originated in Texas. Day trip visitors accounted for approximately 50 percent of all
travel to Abilene, while 41 percent stayed one to three nights. Visitors that traveled to Abilene by automobile accounted
for 94 percent of total visitation and 51 percent traveled 250 miles or less.
In 2011, visitor spending totaled $421.6 million, a 16-percent increase over 2010 and above the pre-recessionary
spending levels of $403.5 million recorded in 2008. This improving trend is noteworthy given the importance of visitor
spending in the creation of jobs and generation of tax revenues to the MSA. During the same year, travel supported
3,520 jobs (55 percent employed in the Hotel and Restaurant industry), generated $7.4 million in local tax receipts and
$24.5 million in state tax receipts, each category reporting a 1.7, 22.1 and 7.3-percent increase over 2010, respectively.
Of the total visitor spending in the Abilene MSA, local transportation and gas was the highest spending category at
$160.9 million.
Abilene MSA
Total Direct Destination Travel Spending (2000-2011)
$500
$421.60
Visitor Spending ($Million)
$403.50
$400
$374.00
$363.30
$349.90
$335.90
$322.40
$282.30
$300
$251.90
$252.10
$255.10
$259.10
'00
'01
'02
'03
$200
$100
$0
'04
'05
'06
'07
'08
'09
'10
'11
Year
Source: Office of the Governor, Economic Development and Tourism Division
Source: Office of the Governor, Economic Development and Tourism Division
21
Airport & Air Passenger Traffic
Abilene’s commercial flight needs are served by the Abilene
Regional Airport (“ABI”) which recently completed taxiway
renovations, opened a new $21-million, 145-foot-high control
tower in May, 2012 and reportedly, may be bidding out for
additional improvements during the summer of 2013. The airport
has the capacity to expand flights to more fully utilize its three
runways and four gates.
American Eagle provides eight daily direct flights (approximately
700 seats) to and from Dallas/Ft. Worth International Airport. In
2008, Continental Connection discontinued flight service to
Houston’s George Bush Intercontinental Airport from Abilene (in
addition to numerous other regional airports) citing high fuel
prices and financial problems as contributing factors. In addition
to the economic recession of the last four years, these factors
have led to a 16.7-percent cumulative decrease in passenger
arrivals at ABI from 2007 to 2012 and have created the general
perception that air service is one of the main visitation
challenges faced by the city. In 2011, ABI experienced an
increase of 7.6 percent in arrivals due to the large influx of
emergency responders fighting the Texas wildfires, and
insurance adjusters addressing hail damage in the area during
that year. Although total passenger arrivals in 2012 were
significantly below the peak levels recorded in 2007, they were
approximately one percent higher than the lowest passenger
volume registered in 2010. Coupled with an improved U.S.
economy and positive visitation trends to the city, such a
nominal increase may set the stage for an upward trend in
passenger arrivals going forward.
Abilene Regional Airport
Total Passenger Arrivals (2007-2012)
Year
Passengers
% Change
2007
96,450
-
2008
92,962
-3.6%
2009
86,231
-7.2%
2010
79,548
-7.8%
2011
85,578
7.6%
2012
80,304
-6.2%
Cumulative Growth (2007-2012):
-16.7%
CAGR (2007-2012):
-3.6%
Source: Abilene Regional Airport
Abilene Regional Airport
22
PROJECT DESCRIPTION, AREA
AND SITE ANALYSIS
23
PROJECT DESCRIPTION, AREA AND SITE ANALYSIS
Preliminary Proposed Concepts
The City believes that it is currently constrained in its ability to book conventions that would better utilize the ACC due
to a lack of adequate lodging inventory with sufficient meeting space to accommodate group business demand in the
downtown area. The ACVB reports that it is losing a significant amount of convention business (an average of $1.8
million per year since 2007) to other cities in the region, such as Midland, Lubbock and Waco, that offer a sizeable
hotel room inventory located adjacent to, or in close proximity to, their convention centers. Furthermore, the ACVB
notes that meeting planners prefer to have their largest room block in a headquarters hotel within close walking
distance of meeting facilities.
The map below illustrates the lodging inventory surrounding the ACC within a two-minute and a five-minute drive time,
or the shortest comfortable transit time for convention attendees from their hotel to the ACC. The downtown lodging
supply is limited to 113 rooms offered by the Civic Plaza Hotel (marked with a red star), which lacks the level of quality
needed to attract the convention business the ACVB can secure. Other lodging facilities (marked with blue stars) are
located along I-20 Business, namely the Alamo Hotel, the Abilene Hotel, the Whitten Inn, the Ponca Hotel, the Western
Motel and the Best Budget Inn. However, all of these properties offer similar or inferior quality accommodations
compared to the Civic Plaza Hotel. In addition, they are located considerably further away and require vehicle transport
to and from the ACC.
Constrained Convention & Group Business Market Geography
Reportedly, many groups would consider Abilene as a
potential destination if higher quality hotel rooms and
meeting space capacity were available in proximity to the
ACC. In order to address this challenge, the City’s
preliminary proposed concept calls for the development of a
hotel located within walking distance of the ACC. The
Proposed Hotel is anticipated to have between 200 and 300
guestrooms complemented by at least 10,000 SF of meeting
space to satisfy potential lodging demand generated by
larger meetings. It should also offer supporting facilities,
services and amenities commensurate with the standards of
an upper-upscale, full-service lodging brand.
24
Downtown Abilene
The Downtown and Cultural District of Abilene is located near
the geographic center of the city. It is loosely bounded by
Hickory Street to the west, North 8th Street to the north, North
Treadway Boulevard to the east, and South 5th Street to the
south.
Aerial View of Downtown Abilene
The specific area for the sites under consideration in this
analysis spans approximately six square city blocks, and is
generally defined by North 8th Street to the north, Pine Street to
the east, North 5th Street to the south, and Cedar Street to the
west. The Proposed Hotel’s location and characteristics seek to
complement the ACC, located at 1100 North 6th Street, as well
as existing and future commercial, retail and tourism
developments extending across the downtown area.
In 1982, Abilene became the first city in Texas to use Tax
Increment Financing (“TIF”) to create a downtown reinvestment
zone. According to the Abilene Economic Development
Department, the TIF governing board has distributed more than
$10.4 million to various projects such as building rehabilitation,
business expansion and beautification projects. Consistent with
this program, the City is reportedly in a position to offer a strong
incentive package that would include almost every option
applicable to similar development projects with the City’s primary
goal of ensuring the sustainability of the project over time.
Downtown & Cultural District Boundaries
25
Downtown Abilene – cont’d
Access and Visibility
The transportation network in downtown Abilene is based on a common CBD square grid. Streets running east-west
on the north and south sides of I-20 Business are named by number (1st, 2nd, etc.) and north-south running roads are
generally named after types of trees (Cypress, Cedar, etc.). Most downtown roads, other than arterials, are limited to
one-way traffic. Major arterials in the downtown area include South 1st Street (I-20 Business), Pine Street, and North
Treadway Boulevard, and primarily carry local traffic.
As is the case with many similarly sized cities in the region, major interstates and highways in Abilene create a looplike perimeter around the more developed areas of the city, while a business route carries local traffic. Downtown
Abilene, is not visible from major interstates and highways or by travelers “passing through”. Interstate 20 traffic flows
east-west along the northern boundary of Abilene, approximately 3.5 miles north of the downtown area. Traffic
heading north-south flows along the eastern and western edges of Abilene via U.S. Highway 83-84 and State Spur
322.
26
Potential Development Sites
According to our conversations with the Client and local government representatives, there are seven publicly-owned
sites adjacent to, or in direct proximity to the ACC offering flexible land options for the potential development of the
Proposed Hotel. The acquisition of the sites took place over the last couple of years, and a number of them were
formerly individual small lots that have been combined to allow for a larger development footprint. The map below
highlights the location of each parcel relative to the ACC.
Site A, separated from the ACC to the north by North 7th Street, is the largest lot and potentially the best suitable for
the development of the Proposed Hotel. To the south of the ACC, across North 6th Street, Sites B, D and G sit on
adjacent lots. Reportedly, low traffic volume experienced along Cedar Street suggests the street could be
permanently closed between North 5th and 6th Street allowing the merging of Sites B and D, a project that would
expand the overall parcel footprint and improve its development potential.
Sites C and E face Pine Street along their
Aerial View of Available Sites Suitable for Development of the Proposed Hotel
main frontage and likely offer a highest
and best use suitable for retail
development, particularly given the City’s
commitment to improve the appearance
and functionality of the Pine Street
corridor as part of the ongoing efforts to
revitalize the downtown area.
Site A - 4.78 acres
Site B - 1.93 acres
Site C - 1.70 acres
Site D - 0.96 acres
Site E - 0.78 acres
Site F - 0.62 acres
N
Site G - 0.29 acres
Source: City of Abilene
27
Site A Overview
At approximately 4.78 acres, Site A is the largest open area surrounding the ACC and is over twice the size of the
next largest site available for development. Although the site currently serves as the ACC’s parking lot, city officials
indicated that there is flexibility to develop the site. The parcel shares a common boundary along its eastern edge with
Site C (1.70 acres) which could potentially be combined with Site A for total area of approximately 6.5 acres with
frontage along a strip commonly referred to as the Pine Street corridor. The Abilene Improvement Corporation recently
improved the strip with a landscaped median and leveled 19 lots, totaling more than four acres along the street, to
encourage new commercial development throughout the corridor. In addition to some retail space available for lease,
Site C could house the Proposed Hotel’s F&B facilities offering a strategic location along the corridor to attract nonguest patronage, while the main hotel building and meeting facilities could be built on Site A.
The parcel also enjoys excellent accessibility to the ACC’s main entrance given the low traffic volume experienced
along North 7th Street, between Pine Street and Cedar Street, facilitating guest flow in and out of the Proposed Hotel.
Aside from the surface parking lot, there are no additional improvements to the site.
Site A - Looking East from Cedar Street
Aerial View of Site A
28
Site B Overview
Formerly a Greyhound Station, Site B is ideally located just to
the south of the ACC across North 6th Street. The 1.93-acre site
is situated to the east of Site D, which reportedly offers the
potential for the combination of both sites with the closure of
Cedar Street between North 5th and North 6th Streets, and is the
second best alternative for development after Site A.
Site B - Looking SE from North 6th Street & Cedar Street
There is a surface parking lot located on the southern portion of
the site, that extends from the corner of Cedar Street to the
corner of Cypress Street along North 5th Street. The site also
includes an office building housing Abilene’s Water Utility
Department located at the corner of North 6th Street and
Cypress. Reportedly, the office could be relocated should the
site be selected for development of the Proposed Hotel.
Site C - Looking South from Pine Street & North 8th Street
Site C Overview
This 1.70-acre site is located on the southwest corner of the
intersection of Pine Street and North 8th Street, opposite to Site
E. Improvements on the rectangular site include an old cleaners
and a former paint and body shop both of which have been
vacated and fenced off in preparation for further potential
development. The site is zoned CB/COR (Central Business
District with a Corridor overlay) and offers the potential for retail
development, including an F&B outlet that could be linked to the
Proposed Hotel. The site would offer the venue a strategic
location along the revamped Pine Street corridor which could
potentially increase the capture rate of outside patronage.
29
Site D Overview
This 0.96-acre site is currently being utilized as a surface
parking lot on its northern portion while a 1950’s vintage
commercial space occupies the southern end of the site. Boy
Scouts of America is the building’s tenant but reportedly, the City
owns the entire parcel along with its improvements. If needed,
the tenants could be relocated should the site be selected for
the development of the Proposed Hotel.
Site D occupies half of the city block formed by North 6th Street
to the north, Cedar Street to the east, North 5th to the south and
Hickory Street to the west. It is bounded to the east by Cedar
Street and to the west by an alley road that separates it from a
couple of businesses and private residences. As previously
noted, Site D offers the connectivity potential with Site B which
increases its development appeal.
Site D - Looking SW from North 6th Street & Cedar Street
Site E - Looking East from Across Pine Street
Site E Overview
This 0.78-acre site is located on the northeast corner of the fourway, lighted intersection of Pine Street and North 8th Street.
Structures on the rectangular site were recently demolished in
preparation for further potential development along the newly
improved Pine Street corridor. The parcel is reportedly owned by
the Abilene Improvement Corporation and although it offers the
potential for retail development given its location along Pine
Street, it does not appear to be suitable for any additional uses
in connection with the Proposed Hotel.
30
Site F Overview
Located on the far north edge of the ACC complex, the 0.62acre site fronts North 8th Street and Cypress Street. The site is
currently sparsely wooded, and is surrounded to the north, east
and west by low density residential improvements.
Site F - Looking North from North 8th Street
Given the relatively small size of Site F, its development
potential in connection with the Proposed Hotel may be limited
to additional parking to relieve the increase of group traffic to the
city. The site may also be improved with additional meeting
space facilities which would ultimately be contingent upon the
footprint configuration of the Proposed Hotel.
Site G Overview
Site G - Looking SW from North 6th Street & Cedar Street
At present, the 0.29-acre site is being utilized as a downtown
surface parking lot. Site G has immediate proximity to the
southern entrance of the ACC and frontage along the heavily
trafficked Cypress Street and North 6th Street. The City has
indicated that given such traffic patterns, it is not possible to
close Cypress Street to join Sites B and G.
The intersection of Cypress and North 6th Streets is currently a
one-way northbound stop with on-street parking fronting the
ACC along North 6th Street in both directions. Similarly to Site F,
Site G’s development potential in connection with the Proposed
Hotel may be limited to additional parking or some retail space
supported by guest traffic should the Proposed Hotel be
developed on Site B.
31
Aerial View of Site B
Aerial View of Site C
Aerial View of Site D
Aerial View of Site E
32
Aerial View of Site F
Aerial View of Site G
33
LODGING SUPPLY AND DEMAND
ANALYSIS
34
LODGING SUPPLY AND DEMAND ANALYSIS
Abilene Lodging Market Overview
Following the downturn in the U.S. economy in late 2008 and the corresponding negative impact on the lodging
industry through 2011, the Abilene lodging market appears to be on a recovery path. The city’s lodging demand
measured by the number of occupied room nights, experienced a CAGR of 2.5 percent between 2007 and 2012.
Furthermore, 2011 and 2012 demand levels were higher than the peak levels reported in 2008 and YTD results (as of
May 2013) indicate lodging demand is five percent higher than 2012 results for the same time period. It is important to
note that Abilene’s lodging market experienced an atypical demand year in 2011 due to the severe drought that
affected Central Texas causing numerous wildfires across the region. During the same year, heavy rainfall
accompanied by hail impacted the area causing major property damage. As a result, the city experienced a high influx
of firefighters and insurance adjusters that contributed to the 15.5 percent demand increase over 2010.
Despite the improved demand, market wide occupancies have experienced a lagging recovery given the high supply
levels recorded, which increased at a CAGR of 6.6 percent between 2007 and 2012. This growth in room supply diluted
the effect from higher demand and drove occupancies below 50 percent in 2010. It is important to note however, that
although these supply shifts impact the market as a whole, they took place in the economy, limited-service segment,
which will not be the target of the Proposed Hotel. Moving forward, the market appears to have entered a correction
period as lodging supply has remained stable over the last two years and with increasing demand, occupancies should
begin to trend upward.
Supply and Demand Trends 2007 - YTD 2013
2007
Occupied
Room Nights
570,999
%
Change
-
Room Nights
Available
892,324
%
Change
-
2008
608,917
6.6%
988,650
10.8%
2009
569,091
-6.5%
1,102,180
11.5%
2010
587,126
3.2%
1,193,269
2011
678,118
15.5%
1,199,915
2012
Year
64.0%
Change
bps
-
$70.92
%
Change
-
61.6%
(240)
$73.48
3.6%
$45.26
-0.3%
51.6%
(996)
$71.90
-2.2%
$37.12
-18.0%
8.3%
49.2%
(243)
$70.27
-2.3%
$34.58
-6.9%
0.6%
56.5%
731
$72.96
3.8%
$41.23
19.3%
-6.0%
Occupancy
ADR
RevPAR
$45.38
%
Change
-
645,912
-4.7%
1,227,365
2.3%
52.6%
(389)
$73.62
0.9%
$38.74
YTD 2012(1)
265,037
-
508,111
-
52.2%
-
$73.92
-
$38.56
-
YTD 2013(1)
278,229
5.0%
507,511
-0.1%
54.8%
266
$74.72
1.1%
$40.96
6.2%
CAGR (2007-2012)
(1)
2.5%
6.6%
(383)
0.8%
-3.1%
Year-to-date figures through May
Source: STR
35
Abilene Lodging Market Overview – cont’d
In 2010 and 2011, the recovery in the overall U.S. lodging sector was primarily driven by improved occupancy
performances which recorded year-over-year increases of 5.7 and 4.4 percent respectively. In 2012, ADR growth
surpassed occupancy growth and led the recovery with a 4.2 percent increase over 2011, driving rates from $101.85
to $106.10. In comparison, the Abilene lodging market has experienced a similar trend although at a lower rate. In
2011, ADR’s increased 3.8 percent over 2010 in response to the increased demand levels previously noted. Unlike
demand levels which declined in 2012 following a record year, ADR in 2012 was able to maintain growth, increasing
from $72.96 to $73.62 or approximately one percent over 2011. This nominal ADR growth may be partially attributable
to the decrease in government per diems from $85 to $77 in 2011. Reportedly, government accounts represent an
important source of demand for local hotels particularly given the proximity of the Dyess Air Force Base to the City.
We also note that given the predominance of economy hotels in the city, which comprise approximately 50 percent of
Abilene’s lodging supply, overall market ADRs have historically remained depressed. At $87.09, city-wide ADRs
excluding economy hotels were $13.47 higher than overall market ADRs in 2012. The chart below illustrates a
monthly ADR trend comparison between city-wide ADRs and city-wide ADRs excluding economy hotels.
2012 City‐Wide Monthly ADR Trends
City-Wide ADR
City-Wide ADR Excluding Economy Hotels
$100.00
ADR
$90.00
$80.00
$70.00
$60.00
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Month
36
Abilene Lodging Market Overview – cont’d
Abilene’s lodging market is primarily concentrated in two main areas located along Interstate 20 near Abilene Christian
University, and near the Mall of Abilene. The city is serviced by a total of 43 hotels primarily comprised of economy and
midscale properties as classified by STR which represent approximately 70 percent of the total lodging market
inventory. Approximately 55 percent of the local inventory is brand affiliated, however, representation by upscale
brands is limited to only three hotels including the Courtyard by Marriott, the Hilton Garden Inn and the Residence Inn.
From 2007 to 2012, the City experienced a 30.2 percent supply increase primarily driven by lodging developments that
were under construction at the peak of the lodging cycle when U.S. economy entered a recession. However, consistent
with current national development trends, Abilene’s lodging market has remained relatively unchanged since mid-2010.
Furthermore, our interviews with local market representatives indicate that, with the exception of one property still in
the planning stages (addressed in a subsequent section of the report), there are no concrete plans for additional supply
in the near future. This trend bodes well for the city’s future development plans as lodging demand continues to
improve and get absorbed by the available room supply, setting up the fundamentals for new hotel construction to
capture latent demand.
Historical Room Supply (2007-2012)
Year
Number of
Hotels
%
Change
Number of
Rooms
2007
2008
33
-
2,581
-
37
12.1%
2,942
14.0%
2009
39
5.4%
3,070
4.4%
2010
42
7.7%
3,295
7.3%
2011
42
0.0%
3,266
-0.9%
2012
43
2.4%
3,361
2.9%
CAGR (2007-2012):
%
Change
30.3%
30.2%
5.4%
5.4%
Source: STR
(1)
Number of guestrooms
Source: STR
37
Abilene Lodging Market Seasonality Patterns
Seasonality and Traveling Patterns
2007‐2012 / YTD 2013
2007
2008
2009
2010
2011
2012
YTD 2013
80.0%
70.0%
Occupancy %
60.0%
50.0%
40.0%
Dec
Nov
Oct
Sep
Aug
Jul
Jun
May
Apr
Mar
Source: STR
Feb
30.0%
Jan
The Abilene lodging market has moderate seasonal variances
in occupancy through the year. Over the last six years, the
summer months of June, July and August have consistently
recorded the highest occupancy levels, with June as the
busiest month. Winter months account for the off-peak
season, with December and January generally experiencing
the lowest occupancy levels. The shoulder season extends
from March to May and from September to November.
Occupancies are typically higher on Friday and Saturday,
fueled by weekend leisure demand arrivals. Sunday
consistently records the lowest occupancies which typically
combine check-outs from weekend leisure travelers and
check-ins from weekday corporate travelers as well as group
business to a lesser extent.
Month
As illustrated in the table to the right, ADRs remain relatively
consistent throughout the year with minor monthly variances
responding to changes in occupancy levels. In 2012, the
highest ADR was recorded in May at $76.08 while the lowest
rate was reported in December at $69.71. Although city-wide
ADRs tend to record minor fluctuations during the week, the
variances experienced are consistent with the weekly
occupancy cycle. ADRs trend higher on Monday, reach their
peak on Tuesday and decline on Wednesday and Thursday.
Subsequently, they trend up again on Friday, down on
Saturday and reach their lowest weekly level on Sunday.
ADR Seasonality Patterns (2007-YTD 2013)
ADR
Month
2007
2008
2009
2010
2011
2012
2013
Jan
$67.09
$69.10
$72.45
$68.66
$67.89
$71.42
$70.73
Feb
$68.90
$71.12
$73.63
$69.92
$70.55
$73.23
$72.98
Mar
$70.14
$72.28
$73.39
$71.44
$71.60
$73.27
$74.10
Apr
$70.87
$74.68
$73.73
$71.73
$73.18
$74.94
$76.48
$78.24
May
$71.28
$74.18
$74.70
$72.79
$75.85
$76.08
Jun
$71.07
$72.36
$71.78
$71.03
$74.49
$75.15
Jul
$70.92
$74.14
$71.00
$70.82
$73.46
$73.40
-
Aug
$73.08
$76.70
$71.51
$69.96
$74.25
$73.90
-
Sep
$71.04
$74.89
$71.57
$69.96
$74.01
$74.05
-
Oct
$72.93
$75.44
$71.64
$70.48
$73.70
$74.83
-
Nov
$71.95
$73.27
$68.78
$69.05
$72.60
$71.68
-
Dec
$70.62
$72.24
$67.12
$66.14
$70.80
$69.71
-
Source: STR
38
Abilene Hotel Tax Revenues
Hotel tax revenues are a strong indicator of overall lodging market growth as they provide funding to support the
promotion efforts of the ACVB and other local tourism organizations. Reportedly, 50 percent of total lodging tax
collections are allocated to the ACVB, 35 percent to the ACC while the remaining 15 percent is allocated to the
Abilene Cultural Affairs Council tasked with the promotion of the arts.
From 2007 to 2012, hotel receipts experienced a CAGR of 3.7 percent and contributed to the cumulative growth of
20.7 percent in hotel tax collections over the same period, increasing from $2,195,857 to $2,651,099. In 2011, the
city’s hotel receipts recorded a 30-percent increase over 2010 receipts as a result from the high demand levels
experienced in the market during the year. However, during the same year, taxable receipts accounted for only 78
percent of total receipts when historically they have ranged between 85 and 90 percent of total receipts. This was
attributable to the significant amount of long-term stays, primarily from firefighters, that qualified for state and local
hotel tax exemptions for occupancies of 30 consecutive days or more. As a result, lodging revenue decreased by 6.5
percent in 2012 but tax collections increased 3.2 percent as taxable revenue returned to historical levels reaching
approximately 85 percent of total receipts.
Historical Hotel Receipts (2007-2012)
Year
Lodging
Revenue
2007
36,416,045
-
2008
38,822,710
6.6%
2009
33,534,749
-13.6%
2010
35,761,091
6.6%
2011
46,606,470
30.3%
2012
43,569,962
-6.5%
CAGR (2007-2012)
%
Change
19.6%
3.7%
Source: Texas Comptroller of Public Accounts
Source: ACVB
39
Leisure Market Overview
Reportedly, leisure travelers accounts for 69 percent of visitor demand to Abilene drawn to the city by a variety of
demand generators. Within the central business/downtown district area, the city features a number of popular
attractions such as The Grace Museum, housed in a rehabilitated 103-year-old historic building; Frontier Texas!, a
western heritage center and one of the few museums in the world to feature life-sized holographic figures that allow
visitors to relive the Old West with the help of state-of-the-art technology. It also serves as the official visitor center for
Abilene and the Texas Forts Trail Region; the Center for Contemporary Arts, which is home to more than 70-artist
members, ten working studios and four galleries presenting over 24 exhibits annually from regional, national and
international artists. Additional downtown attractions include Abilene’s Civic Center, the National Center for Children’s
Illustrated Literature, the 12th Armored Division Memorial Museum and the Historic Paramount Theatre, all together
drawing over 650,000 visitors to the City each year. In 2010, the Texas Commission for the Arts recognized Abilene
as one of five model cultural districts in the state.
The greater Abilene area and vicinity are also home to several major attractions which include:
• The Abilene Zoo, featuring 800 animals and 200 different species;
• The Fort Phantom Hill, featuring the ruins of an 1851 Army post;
• Dyess Air Force Base Visitors Center, home to the 7th Bomb Wing with two B-1B lancer squadrons and 317th Airlift
Group with two C-130 squadrons;
• The Buffalo Gap Historic Village which houses a collection of Indian artifacts and West Texas frontier firearms from
1875 to 1925 in addition to 20 historic frontier buildings;
• Abilene State Park which expands over 1,612 acres along Elm Creek;
• The Taylor County Expo Center which hosts the West Texas Fair & Rodeo featuring livestock and horse shows,
and a PRCA (Professional Rodeo Cowboys Association) rodeo among other activities;
• Local universities, including Abilene Christian University (“ACU”), Hardin-Simmons University, McMurry University,
Cisco College, Texas State Technical College and Texas Tech Schools of Pharmacy and Nursing; and
• Shotwell Stadium, home field of the ACU Wildcats football team.
In addition, biking, birdwatching, camping, golfing, horseback riding, hunting and skating are among several yearround activities available to visitors in the Abilene area.
40
Corporate Market Overview
Abilene’s corporate climate is concentrated heavily in the oil and gas, defense, education, financial, medical and
telecommunications industries. Abilene’s economy also has roots in agriculture and ranching, but is becoming
increasingly service-oriented.
The Texas Tourism Division reports that corporate travel represents 25.3 percent of all visitors to the Abilene MSA.
The highest concentration of corporate activity is located in the downtown area. It is the headquarters for all city and
county government services, as well as the center for financial activity. A new and growing sector in the central
business district is telecommunications, as there are now several telemarketing companies and telecommunication
servicing companies. The city is also the regional center for medical and healthcare facilities in the region. Abilene is
also well suited for the transportation industry, as it is situated at the confluence of several important trade routes.
Dyess Air Force Base, located on the western boundary of the city, serves a major role in Abilene’s corporate
economy employing over 5,400 military personnel and civilians. In addition, the presence of several colleges and
universities makes Abilene the educational center for the region.
Low cost of living and crime rates help make Abilene an attractive location for corporate activity. Major private sector
businesses include companies such as Smith Pipe (an oilfield supply company), Eagle Aviation Services, Sears
Methodist Retirement System, Teleperformance USA, Rentech Boiler Systems, Fehr Foods, First Financial Bank,
Lauren Engineers, Pepsi Beverage Co., Coca-Cola of Abilene, and Tigé Boats among others. All Abilene corporations
make up an integral part of the city’s economic activity and contribute to the low unemployment rates reported in the
area.
In summary, the corporate market in Abilene should continue to perform an important role in the city’s economy and
as the segment expands it should contribute with a balanced demand base for the Proposed Hotel through negotiated
corporate accounts.
41
Meetings Market
The ACVB markets the city as a destination to five core segments: Leisure Travelers, Meeting Planners, Group Tour
Planners, Sports Groups and Travel Writers/Media. Its marketing programs promote awareness of Abilene as a
destination and aim to increase the city’s position as a desirable location for visitors. However, ACVB’s marketing
efforts in the group segment have been challenged by the lack of quality hotel rooms in the downtown area with
meeting space to attract and accommodate larger groups. Furthermore, the ACVB has clearly indicated that the much
needed hotel rooms should be within walking distance of the ACC’s meeting and convention facilities to remain
competitive among similarly sized cities within the region.
In order to solicit group business the ACVB undertakes direct sales, advertising, participation in association meetings
(including multiple visits to Austin, home to most of the state associations in Texas) and exhibiting at tradeshows.
Given the city’s downtown lodging limitations, the ACVB changed its sales and marketing strategy in accordance with
the available meeting inventory that would offer the highest economic impact to the city. As such, the ACVB has
focused its efforts in attracting sports events which generated an economic impact of $8.7 million in 2012 compared to
the ACC’s $836,725 during the same year. To accomplish these results, the ACVB has partnered with numerous
venues to bring sports events to Abilene including ACU, the Taylor County Expo Center, the Rose Park Tennis
Center, the Abilene Speedway, Abilene’s National Soccer Complex, Abilene’s Gun Club and the Diamondback Golf
Club, among others.
In 2012, the ACVB reported a total of 290 citywide conferences and 73,255 delegates, resulting in 36,936 room nights
and an economic impact of $20,953,340, which represented an increase of approximately three percent over the
$20,368,035 reported in 2011. For the fiscal year 2012-2013, ACVB’s Advertising & Marketing budget increased from
$604,480 to $675,800 or approximately 12 percent. Furthermore, our interviews with ACVB officials evidenced its
commitment to assist the Proposed Hotel’s operator in building a strong meeting and convention business, working
with established groups and attracting new business. The ACVB’s willingness to strongly support and help develop
the Proposed Hotel’s book of business will be a key success factor.
42
Meetings Market – cont’d
In addition to the limited meeting space offered by local hotels, the city offers the following meeting and convention
venues:
• The ACC is the premier meeting and convention venue serving Abilene and surrounding communities. The original
100,000-SF facility was developed in 1970 and in 1990 the 30,000-SF Conference Center addition was built via TIF
funding. The 130,000-SF facility, which can be divided into 19 separate meeting areas, includes approximately
26,000 SF of meeting and convention space, a 20,000-SF exhibit hall, a 9,000-SF foyer area, and a 45,000-SF
auditorium with a total of 2,142 seats. In 2012, the ACC was host to 46 multi-day events and 550,000 visitors. The
ACVB aggressively solicits and gives booking priority to conventions, and the City underwrites a portion of the
rental costs and offers complimentary transportation if 70 percent of attendees are from out of town, over 200
rooms are used, or when a conference cannot be accommodated at a hotel. The ACC is located downtown,
adjacent to all the potential development sites and in fairly good condition despite the building’s age. It is currently
owned and managed by the City although City officials have expressed the possibility for an ACC management
contract option, including exclusive catering rights as part of an incentive package that may be offered to the
potential venture partner. In addition, lodging tax revenues may become available to fund debt service on
improvements to the ACC, an option that should be strongly considered should the Proposed Hotel be developed
as the ACC is reportedly running out of exhibit space to accommodate a number of recurring events that have
grown over the years. The improvements to the ACC should enhance the facility’s appeal and increase its
competitiveness in the regional convention and meetings market.
• The Taylor County Expo Center is a nine-building multi-purpose facility that expands over 117 acres and is home to
the annual West Texas Fair and Rodeo. The Expo Center is well suited to handle major equestrian and livestock
shows and concert events, both indoor and outdoor. The facility features approximately 18,000 SF of meeting
space and 69,000 SF of exhibit space over five buildings. The Coliseum building, the facility’s largest, has
permanent seating for 5,000 spectators while the Entertainment Pavilion features a 1,200-SF stage and seating for
1,000. The facility has 5,000 parking spaces and is owned by Taylor County. Its construction was funded by locally
issued bonds.
43
Meetings Market – cont’d
• The Bob and Shirley Hunter Welcome Center at ACU is a 57,000-SF facility that offers a conference center to
accommodate up to 700 people and includes a full-service kitchen and high-definition video capabilities. The
Welcome Center began construction in December 2007 and was completed in late 2009 with an estimated budget
of $16 million. It houses career services, student financial services, investment, Women for ACU, the alumni
association and the admissions department of ACU.
44
Convention Activity – Civic Center
Convention activity at the ACC can be described as regional and local in nature, characterized by small to mediumsized groups meeting for short lengths of time. Over a five-year period, convention attendance at the ACC declined
14.4 percent while the room nights generated was nearly half the number of room nights generated in 2007, with each
attendee generating an average of 0.5 nights. In addition, the economic impact produced by convention bookings at
the ACC has declined proportionately with attendance, recording a 20-percent decrease from 2007 to 2012. This
significant decline in convention business may be partly attributable to the economic recession which greatly slowed
group business activity and corporate travel over the last four years. However, the reduced convention activity also
evidences Abilene’s lack of competitiveness in the market place due to the absence of a downtown hotel adjacent to
the ACC that would allow it to capture a higher number of conventions.
It is important to note that from October 2012 to April 2013 the ACC averaged a 93-percent weekday usage and a 100percent weekend usage mostly associated with local events and meetings, some of which were multi-day and thus
made use of the local lodging facilities. In summary, the ACC reports a busy operation but the source of its business
does not come from the more profitable conventions that contribute with large room blocks and a higher economic
impact to the city.
Abilene Civic Center Convention Sales
Definited and Completed Bookings (2007-2012)
% Change
Room Nights
% Change
Economic
Impact
Year
Attendance
% Change
2007
4,355
-
2,810
-
$1,046,505
-
2008
5,380
23.5%
2,695
-4.1%
$1,338,325
27.9%
2009
4,205
-21.8%
2,405
-10.8%
$1,057,150
-21.0%
2010
6,420
52.7%
3,476
44.5%
$1,616,925
53.0%
2011
2,360
-63.2%
1,095
-68.5%
$596,050
-63.1%
2012
3,730
58.1%
1,404
28.2%
$836,725
40.4%
-14.4%
-50.0%
-20.0%
CAGR (2007-2012):
-3.1%
-13.0%
-4.4%
Source: ACVB
45
Potential Impact From Cline Shale Oil Formation
Select Markets Impacted by Cline Shale Oil Formation
Hotel Occupancy by Year (2003‐2012)
100%
90%
80%
Occupancy %
The Cline Shale oil formation, situated primarily within the
counties of Howard, Mitchell, Fisher, Glasscock, and
Sterling to the west of Abilene, is rumored to become a
major shale oil and natural gas source in the coming
years. According to the U.S. Geological Survey,
preliminary data suggests that the formation could
contain up to 30 billion barrels of recoverable oil,
significantly more than other formations across Texas
and the nation. The Eagle Ford Shale in South Texas, by
comparison, is estimated to contain 10 billion barrels of
recoverable oil and gas, reportedly.
70%
60%
50%
In advance of the expected oil field development and
associated economic impact that it may deliver, cities
surrounding the formation such as Midland, Odessa and
San Angelo have reportedly experienced a major surge in
housing, retail and lodging development to accommodate
the increased demand from oilfield and support staff.
40%
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
Year
Midland
Odessa
San Angelo
Abilene
Source: STR and Source Strategies
As illustrated in the chart above, this oil-driven demand increase is evidenced by the high levels of lodging occupancy
experienced by the cities surrounding the formation. Midland and Odessa, reported occupancies above 90 percent in
2012, while San Angelo experienced an occupancy increase from 62.9 percent in 2011, to 73 percent in 2012. Given
its proximity to the shale, city officials and lodging representatives anticipate a strong demand outlook for Abilene. City
hotels are reportedly experiencing business overflow, with some workers commuting from Abilene due to the large
number of sold out lodging accommodations and high rates prevalent in the areas surrounding the Permian Basin.
However, given the relatively recent discovery of the formation, the related exploration activities are still in the early
progress stages and as such, the timing and extent of the potential impact to the city is currently unknown.
46
Comparable Lodging Supply Analysis
This section of the report provides an analysis of comparable hotel properties within the DMA and the region. The
analysis includes an overview and description of each property, including their facilities and amenities, individual
(where available) and aggregate operating performance as well as relevant additions to the overall lodging supply that
may have an effect on the operating performance estimates for the Proposed Hotel.
Given the absence of directly comparable hotels in the DMA, and the unique characteristics of the Proposed Hotel,
A&M expanded its selection criteria to include hotels in regional markets that met two or more of the following
characteristics:
•
•
•
•
•
•
STR classification: “upscale” or “upper upscale”;
Between 150 and 300 rooms;
Between 5,000 and 20,000 SF of meeting space;
Located in the downtown area of a similarly sized city in the region (preferably a convention business competitor);
Located within 200 miles of the Abilene MSA; and
Affiliated with a national lodging chain.
Based on our research and discussions with city, lodging and tourism representatives, A&M identified eight properties
grouped in two comparable sets (“Comp Sets”) for the Proposed Hotel. Four properties are located in Abilene and
comprise the local Comp Set, and four properties, considered to have similar characteristics to the Proposed Hotel
and located within the region, make up the regional Comp Set. The comparable hotels are listed below:
Local Comparable Set
Regional Comparable Set
•
•
•
•
•
•
•
•
MCM Elegante Suites
Overton Hotel & Conference Center, Lubbock, TX
DoubleTree by Hilton Hotel Midland Plaza, Midland, TX
Hilton Waco Hotel, Waco, TX
Ambassador Hotel, Amarillo, TX
47
Local Comparable Lodging Supply
The tables below provide a summary overview of the properties in the local Comp Set including opening date, number
of rooms, estimated 2012 ADR, occupancy, and market segmentation, as well as meeting and supporting facilities.
Local Comparable Hotel Set Facilities Profile
Property
Location
Year Opened /
Last Renovation
Number
of Floors
Number of Rooms
Total
Doubles
King
Suites
Average
Room
Size (SF)
Supporting Facilities
Restaurants
Fitness
Pools
/ Bars
Center
1/1
Outdoor
Yes
300
Meeting Space (SF)
Per
Largest
Room
Room
1,600
16.0
1,600
Total
Abilene, TX
1996 / 2012
3
100
48
49
3
MCM Elegante Suites
Abilene, TX
1985 / 2005
3
175
-
-
175
N/A
1/1
Indoor
Yes
11,250
64.3
3,500
Abilene, TX
2008
4
123
55
68
-
300
1/1
Indoor
Yes
3,000
24.4
2,775
Abilene, TX
2008
4
117
-
-
117
600
-
Outdoor
Yes
600
5.1
600
Total
-
-
-
515
103
117
295
-
-
-
-
-
16,450
31.9
8,475
Average
-
-
-
129
52
59
98
400
-
-
-
-
4,113
27.5
2,119
N/A - Not Available
Source: Individual Properties and A&M
Local Comparable Hotel Set Performance Profile
Estimated 2012
Property
Estimated Market Segmentation
STR
Brand
Classification Affiliation
ADR
Occupancy
RevPAR
Corporate
Leisure
Group
$97.00
60.0%
$58.20
40%
50%
10%
Upscale
Marriott
MCM Elegante Suites
$93.00
70.0%
$65.10
40%
30%
30%
Upscale
Independent
$101.00
75.0%
$75.75
50%
30%
20%
Upscale
Hilton
$98.00
78.0%
$76.44
60%
35%
5%
Upscale
Marriott
Average
$97.25
70.8%
$68.87
48%
36%
16%
-
-
48
Courtyard by Marriott Abilene (“Courtyard”) is a 100-unit,
upscale hotel located at 4350 Ridgemont Drive with proximity to
U.S. Highway 83-84. The hotel is adjacent to the 65-acre Mall
of Abilene, the MCM Elegante Suites and the Hilton Garden Inn.
It is located approximately five miles southwest of the ACC and
nine miles southwest of Abilene Regional Airport.
The hotel was fully renovated following its acquisition by Texas
Western Hospitality (“TWH”) in October 2011. TWH, the
management subsidiary of Western International, is a Dallasbased lodging management company with more than 30 years
of experience in lodging development and operations.
Reportedly, the scope of renovations included all guestrooms
and public spaces, including new FF&E. The renovation also
included an expansion of the meeting space from 1,080 to 1,600
SF, an outdoor heated pool and a barbecue pit for guest use.
Following its January 2012 reopening, the hotel now features
Marriott’s new Courtyard prototype which includes an extended
lobby and Courtyard’s Bistro and Bar.
Front View of Courtyard’s Building Facade
Standard Guestroom
Leisure demand accounts for approximately 50 percent of the
hotel’s business given its location near the Mall of Abilene and
proximity to many dining options. Although the hotel reportedly
lost some of its corporate business during renovations, the
segment makes up 40 percent of the hotel’s demand. Group
demand only represents 10 percent of the hotel’s market mix.
In 2012, the hotel recorded an estimated occupancy of 60
percent, an ADR of $97.00 and a RevPAR of $58.20, the lowest
in the local comp set attributed to ramp up following renovations.
49
MCM Elegante Suites
The MCM Elegante Suites (“MCM”) is an all-suite hotel located
at 4250 Ridgemont Drive within close proximity of U.S. Highway
83-84. The hotel is adjacent to the Mall of Abilene, the Hilton
Garden Inn and the Courtyard and It is located approximately
five miles southwest of the ACC and nine miles southwest of
Abilene Regional Airport.
The MCM, which sits on a 5.8 acre lot, opened in 1985 and was
last renovated in 2005 following its acquisition by ICA
Properties, an Odessa-based real estate company led by John
Bushman. Formerly an Embassy Suites, the hotel has a total of
175 suites on three floors and offers approximately 5,000 SF of
flexible meeting space divisible into six rooms as well as two
open-air atriums that comprise approximately 6,250 SF of
additional event space. Remington’s Restaurant offers breakfast
(complimentary), lunch and dinner, and serves as the MCM’s
beverage outlet featuring complimentary beverage service in the
evenings. An indoor pool and fitness room are also available to
hotel guests.
Front View of the MCM
Standard Guestroom Suite
The hotel is widely known to offer the largest meeting capacity
in the lodging market and is therefore viewed as one of the most
attractive options to groups or businesses requiring meeting
facilities. Its market mix is comprised of 40 percent corporate, 30
percent group, and 30 percent leisure demand. In 2012, the
hotel recorded an estimated occupancy of 70 percent and an
ADR of $93.00, the second lowest in the local Comp Set which
is reportedly a reflection of the MCM’s dated lodging product
offering. RevPAR for the same period was estimated at $65.10.
50
The Hilton Garden Inn (“HGI”) is a 123-unit upscale hotel
located at 4449 Ridgemont Drive within proximity of U.S.
Highway 83-84. The hotel is adjacent to the 65-acre Mall of
Abilene, the MCM, and the Courtyard and it is located
approximately five miles southwest of the ACC and nine miles
southwest of the Abilene Regional Airport.
The hotel, which sits on a 2.9 acre lot, was built in 2008 and is
operated by Kana Hotel Group, a hotel development and
management company based in Knoxville, TN with a hotel
portfolio of 35 properties across 10 states. HGI features one
300-SF breakout room and one 2,775-SF ballroom divisible into
three meeting areas. In addition, breakfast and dinner are
offered daily at the Great American Grill restaurant while the
Pavilion Pantry offers sundries and the Pavilion Lounge features
a bar area. An indoor swimming pool and a fitness room (with
treadmills and free weights) are available to hotel guests.
Reportedly, the HGI will undergo a Hilton-mandated renovation
by December 2013 that will reconfigure the lobby into a larger,
more open space and revamp the room product.
Front View of HGI
Standard Guestroom
The hotel caters primarily to the corporate and leisure segments
which account for 50 and 30 percent of HGI’s total market
segmentation. Furthermore, its conveniently sized meeting
space allows the hotel to capture small to mid-size group
meetings which are estimated to represent 20 percent of HGI’s
room night demand. In 2012, the hotel recorded an estimated
occupancy of 75 percent and an ADR of $101. RevPAR for the
same period was estimated at $75.75.
51
Residence Inn by Marriott Abilene (“RIM”) is a 117-unit, all-suite
upscale hotel located at 1641 Musgrave Boulevard within
proximity of U.S. Interstate 20. The hotel is located on the north
edge of Abilene, outside of the I-20 loop, and is approximately
five miles northeast of the ACC and five miles north of the
Abilene Regional Airport.
The hotel opened in 2008 and is owned and operated by TWH
which also owns the Courtyard. It features a total of 87 studio
suites, 26 1-bedroom suites and four 2-bedroom suites. It also
offers a 600-SF boardroom used for small meetings of up to 50
people, and even though there is no formal F&B outlet at the
property, the hotel offers free daily hot breakfast buffet and a
weekday happy hour with free cocktails. An outdoor swimming
pool and fitness room are also available to hotel guests.
RIM’s Building Facade
Studio Suite
The RIM caters primarily to the extended stay, corporate
clientele which accounts for approximately 60 percent of the
hotel’s business while the leisure segment represents an
estimated 35 percent of the hotel’s demand. Reportedly, one of
the main disadvantages of the RIM against its competitors is the
lack of meeting space enough to accommodate small groups
which is the reason group business only accounts for five
percent of the hotel’s total market mix. In 2012 the RIM
recorded an estimated occupancy of 78 percent and was the
ADR market leader with an estimated rate of $98.00. The
hotel’s RevPAR for the same year was $76.44.
52
Local Comparable Set
The four hotels identified and included in the local Comp Set for the Proposed Hotel have a combined total of 515
rooms. The properties are considered the highest quality lodging options in Abilene and are all located within a fiveand-a-half mile radius of downtown Abilene. Some additional characteristics of the properties are presented below.
Size
The number of rooms for hotels in the local Comp Set range from 100 to 175 rooms, with an average of 129 rooms.
Amenities
All of the comparable hotels offer limited services and amenities, although relative to the Abilene market the HGI, the
RIM and the MCM can be considered full-service as they all offer F&B facilities. The average room size of all properties
is 400 SF but it includes RIM’s 600-SF suites which are significantly larger than the average standard guestroom size
of 300 SF. All of the properties offer swimming pools and fitness facilities.
Meeting Facilities
The amount of meeting space offered by the comparable hotels is for the most part limited and varies widely. The
Residence Inn has only 600 SF of meeting space while MCM offers a total of 11,250 SF of meeting space. However, it
should be noted that only 5,000 SF are enclosed. The largest meeting room in the local Comp Set averages 2,119 SF
in size.
Segmentation
Given the comparable hotels’ design and orientation, there is a strong dependence on weekly corporate demand
primarily generated by local business, and weekend leisure demand. These two segments account for an estimated 48
percent and 36 percent of the total occupied room nights in the market, respectively. The lack of meeting room
capacity to accommodate group business limits the hotels’ ability to capture this type of demand which is estimated to
account for only 16 percent of the total market segmentation for the local comparable hotels.
Seasonality
The local competitive set experiences seasonality patterns consistent with those of the Abilene lodging market. The
corporate and group segment comprises the majority of demand during weekdays, while the leisure segment provides
higher demand during weekends and holidays. Summer months experience the highest occupancy levels, while winter
months make up the lowest-performing season.
53
Selected Local Comparable Hotels’ Location Map
Proposed Downtown Hotel
MCM Elegante Suites
Courtyard by Marriott Abilene
54
Regional Comparable Lodging Supply
The tables below provide a summary overview of the properties in the regional Comp Set including opening date,
number of rooms, aggregate 2012 ADR, occupancy, and market segmentation, as well as meeting and supporting
facilities.
Regional Comparable Hotel Set Facilities Profile
Number of Rooms Average Average
Room
Suite
Total
Suites
Size (SF) Size (SF)
Year Opened /
Last Renovation
Number
of Floors
Overton Hotel & Conference Center
Lubbock, TX
2009
15
303
12
442
DoubleTree by Hilton Hotel Midland Plaza
Midland, TX
2012
11
261
7
364
Hilton Waco Hotel
Waco, TX
1981 / 2008
11
195
-
Ambassador Hotel
Amarillo, TX
1984 / 2006
10
260
3
Total
-
-
-
1,019
22
-
-
-
-
-
Average
-
-
12
255
7
371
806
-
-
-
(1)
Meeting Space (SF)
Supporting Facilities and Services
Location
Property
Per Room
Largest
Room
19,112
63.1
11,250
10,230
39.2
6,048
11:00 PM
10,674
54.7
3,420
12:00 AM
5,854
22.5
3,375
45,870
45.0
24,093
11,468
44.9
6,023
Pools
Fitness
Center
Business
Center
1/1
Outdoor
X
X
1:00 AM
2/2
Outdoor
X
X
11:00 PM
N/A
1/1
Outdoor
X
X
N/A
2/2
Indoor
X
X
Restaurants
/ Bars
884
728
327
350
Room
Service
Total
(1)
Excludes pre-function/exhibit space
N/A - Not Available
Regional Comparable Hotel Set Performance Profile
Property
2013 Published
Rates (1)
2012
ADR
Occupancy
Estimated Market Segmentation
RevPAR
Corporate
Leisure
Group
Distance from
Convention
Center
Distance from
Abilene
STR
Classification
Brand
Affiliation
$150 - $190
30%
30%
40%
1.2 miles
160 miles
Upper Upscale
Independent
DoubleTree by Hilton Hotel Midland Plaza
$154 - $286
45%
20%
35%
Adjacent
105 miles
Upscale
Hilton
Hilton Waco Hotel
$139 - $174
40%
20%
40%
Connected
160 miles
Upper Upscale
Hilton
Ambassador Hotel
$119 - $124
30%
35%
35%
3.3 miles
270 miles
Upper Midscale
Independent
Average
$141 - $188
36%
26%
38%
-
-
-
-
‐
‐
‐
Aggregate Comp Set Performance
2012
$125.18
60.1%
$75.27
YTD May 2012
$118.72
60.8%
$72.20
YTD May 2013
$142.44
56.5%
$80.48
(1)
Standard room rates
55
Overton Hotel & Conference Center, Lubbock, TX
The Overton Hotel & Conference Center (“Overton”) is a 303unit upper-upscale hotel located
in Lubbock, Texas,
approximately 165 miles northwest of Abilene. The hotel is
located to the northwest of downtown Lubbock, approximately
0.25 miles east of Texas Tech University and the Jones AT&T
Stadium in an area known as the Overton Park District,
reportedly one of the largest privately funded redevelopment
projects in the U.S. based on acreage (325 acres). The hotel
also enjoys close proximity to the Lubbock Memorial Civic
Center which is located 1.2 miles east of the property.
The Overton, which was built in July 2009, is owned and
operated by 1859 Historic Hotels Ltd. and was developed by
Garfield Traub, a Dallas-based company specializing in public
and public-private development projects. The project was
partially financed with private debt and equity, and through a
public-private partnership venture. The hotel features
approximately 20,000 SF of total meeting space extending
across two floors. The largest ballroom is 11,250 SF and can
accommodate events of up to 1,200 people. The Pecan Grille
Restaurant at the Overton provides food and beverage service
at the hotel. It also features a business center, fitness center,
concierge services and an outdoor pool and Jacuzzi.
Hotel Building and Conference Center
Standard Guestroom
Based on the Overton’s new product, strategic location and
business orientation its market mix is estimated to account for
40 percent group, 30 percent corporate and 30 percent leisure
business. 2013 published rates for the hotel range between
$150 and $190.
56
DoubleTree by Hilton Hotel Midland Plaza, Midland, TX
The DoubleTree by Hilton Midland Plaza (“DoubleTree”) is a
261-unit upscale hotel located in Midland, TX approximately
150 miles west of Abilene. The hotel is located in downtown
Midland and is adjacent to the Midland Center and Centennial
Plaza.
The two-tower hotel, formerly the Hilton Midland & Towers, was
built in 1983 and a complete interior and exterior renovation
project was completed in early 2005. In 2012, the hotel was
rebranded DoubleTree by Hilton followed by extensive
renovations to the guestrooms, lobby and F&B facilities. The
property features approximately 10,230 SF of meeting space
and can accommodate 450 people in its 6,048-SF ballroom, the
property’s largest. The DoubleTree has two restaurants, two
lounges, and a full-service coffee bar on the property. One
restaurant, Le Bistro, serves a breakfast and lunch buffet, while
another, Chez’s, offers evening dining. The Mahogany Bar
offers drinks on the main level while Ali Bubba’s patio bar
serves drinks and pub fare on the third floor of the north tower.
It also features an outdoor swimming pool and a fitness room.
DoubleTree’s Front Facade
Junior Whirlpool Suite
The DoubleTree is considered one of the highest quality lodging
options in Midland with published rates ranging between $154
and $286. Its national hotel affiliation, downtown location,
meeting space, and close proximity to the Midland Center
enable the hotel to cater to all types of travelers. Its market mix
is comprised of approximately 45 percent corporate, 35 percent
group and 20 percent leisure.
57
Hilton Waco Hotel, Waco, TX
The Hilton Waco hotel (“Hilton”) is a 195-room upper-upscale
hotel located in Waco, Texas, approximately 180 miles
southeast of Abilene. The hotel is located in downtown Waco
and connected to the Waco Convention Center via a covered
walkway.
The hotel, built in 1981, underwent a $17-million, floor-by-floor
renovation completed in 2008. The property features
approximately 10,000 SF of flexible meeting space which is
complemented by the Convention Center’s 144,000 SF of
function and exhibit space. The hotel’s largest meeting room
measures 3,420 SF and can accommodate up to 300 people in
a single event. Food and beverage service is provided by The
Brazos Grille which also includes an additional bar in the lobby.
The Hilton features a business center, fitness center, and an
outdoor pool. The city of Waco recently celebrated the
reopening of their Convention Center after a three-year, $17.5million renovation that added over 25,000 SF of space.
Hilton’s Building Facade
Standard Guestroom
The Hilton’s national hotel affiliation, strategic downtown
location, and connectivity to the Convention Center allow it
capture a significant amount of corporate and group business
which account for 40 percent of the hotel’s market
segmentation. Leisure demand represents 20 percent of the
hotel’s market mix. Current published rates range between $139
and $174.
58
Ambassador Hotel, Amarillo, TX
The Ambassador Hotel (“Ambassador”) is a 263-unit uppermidscale hotel located in Amarillo, Texas, approximately 270
miles northwest of Abilene. The hotel is situated outside of
downtown Amarillo along Interstate 40 and approximately 3.3
miles southwest of the Amarillo Civic Center.
The atrium-style hotel was built in 1984 and was last renovated
in 2006 following the hotel’s acquisition in December 2004 by
Parthenon Hospitality Ltd. of Amarillo, TX whose owner, Dinesh
Patel, is also a hotel owner in Abilene, TX. The scope of the
renovation included new glass, carpet, tile, window treatments
and furnishings for the public spaces. In addition, FF&E was
upgraded in the guestrooms and Concierge guestroom level
was expanded. The hotel features approximately 6,000 SF of
meeting space and its largest room, measuring 3,375 SF, can
accommodate groups of up to 425 people. A TGI Friday’s and
the Heritage Park Restaurant provide F&B services at the hotel
which also features a swimming pool, a hut tub, an exercise
room and a business center.
Ambassador’s Building Facade
Guestroom
The Ambassador’s market segmentation is allocated 35 percent
to group, 35 percent to leisure and 30 percent to corporate.
Reportedly, the hotel has recently joined the portfolio of
Magnuson Hotels, the world’s largest independent hotel group
representing nearly 2,000 independent hotels and resorts
across North America and the U.K. Such affiliation is anticipated
to upgrade the Ambassador’s market positioning and generate
incremental reservation revenue going forward. Current
published rates at the hotel range between $119 and $124.
59
Regional Comparable Set
The four hotels identified and included in the regional Comp Set have a combined total of 1,019 rooms. The selected
properties are considered the primary lodging option for convention center visitors in each regional market. Some
additional characteristics of the properties are presented below.
Size
The number of rooms for hotels in the regional Comp Set range from 195 to 303 rooms, with an average of 255
rooms.
Amenities
Guestroom size ranges between 327 SF and 442 SF, with an average of 371 SF. With the exception of the Hilton
Waco, all other comparable properties include suites in their room inventory. All of the four regional comparable
properties offer at least one restaurant and beverage outlet, although the DoubleTree and the Ambassador each offer
additional dining options. In addition, all hotels feature a swimming pool, fitness room, business center and offer inroom dining service up to 11:00 PM, 12:00 AM and 1:00 AM varying from property to property.
Meeting Facilities
The amount of meeting space offered by the hotels is consistent with typical convention center hotels. Total meeting
space ranges from 5,854 SF at the Ambassador to 19,112 SF at the Overton, with an average of 11,468 SF. The
Overton offers the largest single meeting room at 11,250 SF and the average among all the regional comparable
hotels is 6,023 SF. This meeting space configuration allows the properties to capture mid-size to large events ranging
from 300 up to 1,200 people.
Segmentation
In general, demand for the regional Comp Set arises from both group demand, which accounts for approximately 38
percent of the total occupied room nights, and corporate demand, which accounts for approximately 36 percent of the
total demand. Leisure travel comprises the remaining 26 percent of the total room nights sold.
Location
With the exception of the Ambassador, the hotels are adjacent to, or located within close proximity of, the major
meeting and conference facility. Although Amarillo is located outside the 200-mile radius established in A&M’s
selection criteria, our fieldwork interviews indicate it is considered a regional market that strongly competes for the
same group business as Abilene and therefore it was included in our analysis.
60
Selected Regional Comparable Hotels’ Location Map
Ambassador Hotel
Amarillo, TX
Lubbock, TX
Abilene, TX
DoubleTree by Hilton Hotel
Midland Plaza
Midland, TX
Hilton Waco
Waco, TX
61
Recent Brand Changes and Additions to the Lodging
Supply
View of Adoba Eco Hotel’s Site from Ambler Avenue
Based on our conversations with local market representatives,
there have not been any brand changes or additions to the
lodging supply in the last 18 months. The last major property
renovation that took place in the DMA was the one performed
to the Courtyard as previously mentioned in the property’s
description.
Planned Additions to the Lodging Supply
It is important to consider any new hotels that may have an
impact on the Proposed Hotel’s operating performance. Based
on our fieldwork interviews, we have identified the following
properties:
Aerial View of Proposed Adoba Eco Hotel Proposed Site
• Adoba Eco Hotel and Conference Center Abilene – The
proposed Adoba Hotel will reportedly be a LEED-certified,
300-room, full-service conference center hotel featuring
14,000 SF of meeting space and a 9,000-SF ballroom. The
property will be operated by Denver-based Atmosphere
Hospitality Management. The site for the hotel’s proposed
development is located in the neighborhood of HardinSimmons University and Hendrick Medical Center, at the
intersection of Ambler Ave. and Treadaway Blvd., and is
bordered on its western edge by railroad tracks. Although
the project was announced in April, 2013, it is still widely
regarded as a hotel in the planning stages at best since no
formal plans or permits have been filed with the City as of
the date of our fieldwork.
Proposed Site
62
Planned Additions to the Lodging Supply – cont’d
• Holiday Inn Hotel – A 100-room Holiday Inn hotel has been
rumored to enter the market and be located near the
intersection of highway I-20 and West Lake Road, and in
close proximity to the Hampton Inn & Suites I-20. No further
details about the project were available at the time of our
fieldwork.
• Hotel Settles, Big Spring, TX – The Hotel Settles is a 65room, upscale hotel located in the Central Business District
of Big Spring, TX, 110 miles west of Abilene. The hotel was
originally built in 1930 and closed in the early 1980’s. In
2006, the hotel was acquired by Settles Development Co.
led by Brint Ryan, CEO of Ryan LLC, the seventh largest
tax service firm in the country. The hotel re-opened in
January, 2013 following extensive renovations that began in
2008 and it is operated by La Corsha Hospitality Group, a
hotel management company that has worked with the
Driskill Hotel in Austin, the Mansion on Turtle Creek and
Hotel Adolphus in Dallas, and Saint Anthony Hotel in San
Antonio. The hotel now features upgraded guestroom
facilities and amenities, a full-service restaurant, Settles
Grill, the Pharmacy Bar and Parlor, a cigar bar, meeting
facilities with capacity for up to 300 people and an outdoor
pool. Although this property is not anticipated to be a direct
competitor of the Proposed Hotel, it is worth noting the
upscale lodging development activity taking place in the
downtown area of a regional community in close proximity to
Abilene.
Location Map of Planned Additions to the Supply in the DMA
Rumored Holiday
Inn Hotel
Proposed Adoba Eco Hotel
63
Planned Additions to the Lodging Supply – cont’d
For the purposes of our analysis, only the Adoba Eco Hotel was considered as relevant addition to the lodging supply,
however, its degree of competitiveness in the market was lowered to account for the fact that no concrete plans for its
development or an anticipated opening date have yet been announced. The planned number of rooms, rate of
competitiveness against the Proposed Hotel and assumed opening date of the new lodging supply are illustrated in
the table below.
Additions to the Lodging Supply
Assumed Opening Date
Name
Proposed
Percent
Rooms Competitive
Month
Day
Year
Development
Stage
Planned
Proposed Hotel
250
100%
Jan
1
2016
Adoba Eco Hotel and Conference Center
300
25%
Jan
1
2016
Planned
Holiday Inn Hotel
100
0%
-
-
-
Rumored
Total
650
Source: Market representatives and A&M
64
Market Segmentation Description and Analysis
Lodging demand is viewed as being generated by several major market segments, each utilizing lodging
accommodations for different reasons with varying needs and expectations. For the purposes of our analysis, the
predominant market segments (also knows as market mix) are referred to as the Leisure segment, the Group
segment and the Corporate segment.
Leisure Segment
The transient leisure segment is mainly comprised of Free Independent Traveler (“FIT”) bookings which are made by
travelers who arrange for their accommodations either directly with the hotel or through a retail travel agent. Because
these accommodations are made on an individual basis, rate discounts are minimal. This segment is generally not as
price sensitive as the other segments, especially during peak season.
The FIT market segment is the second largest market segment of the local comparable hotels, representing an
average of 36 percent of their market mix. These hotels attract this segment primarily on weekends and holidays
given their location near the Abilene Mall. It is anticipated that the Proposed Hotel will also benefit from this segment
as leisure demand is drawn to the Historic Downtown Cultural District for pleasure or from travelers visiting the
Hendrick Medical Center or one of the several colleges and universities located in close proximity to downtown
Abilene.
Group Segment
The group segment has a number of sub-segments that use hotel facilities for different reasons, and is typically
defined as a booking of ten rooms or more. The primary group sub-segments are: incentive, corporate, associations,
and social (SMERF), described below:
• Incentive groups are usually sponsored by a company or corporation as a reward to employees for service or
achievement of a particular objective or goal. Incentive travel groups stay primarily in upper-upscale and luxury
hotels, and display a high level of discretionary spending. This sub-segment typically represents the largest source
of group demand in the market.
65
Group Segment – cont’d
• Corporate groups include business meetings and management development sessions. The purposes of these
meetings are generally twofold: to accomplish the business of the organization and to provide an opportunity for the
members of the group to socialize. Corporate groups are typically not price sensitive.
• Association groups typically consist of professionals meeting to discuss issues affecting their area of expertise.
Association meetings are often large and require double-bedded rooms. The association group market is generally
price sensitive and prefers to book during the off-season months.
• Social, also known as SMERF, consists of groups gathering for social reasons, such as weddings, anniversaries,
birthdays, recreation and family reunions, as well as military, education, religious and fraternal organizations. In the
case of the comparable hotels, the primary reason is graduations, sports and family events, as well as weddings to
a lesser extent.
With the exception of the MCM, the local comparable properties lack the meeting facilities required to generate a
meaningful amount of group business which only accounts for an average of 16 percent of their total market mix.
Conversely, the facilities design and market orientation of the regional comparable hotels allows them to capture a
higher volume of group business which represents 38 percent of their market mix on average. Since group pricing is
influenced by the size and the overall impact on food and beverage and other revenues for the hotel, rather than the
type of group, the Proposed Hotel’s anticipated size and location near the ACC should allow it to accommodate a
broader scope of meetings, from small events to larger, more profitable groups.
Corporate/Commercial Segment
The commercial segment consists primarily of individual travelers who are visiting Abilene for business purposes. This
segment also consists of government demand and it is strongest Monday through Thursday, declines significantly on
Friday and Saturday, and increases minimally on Sunday. The typical length of stay for commercial guests ranges
from one to three days, and the rate of double occupancy is a low 1.2 to 1.3 people per room. Corporate travel in the
DMA is generated by a variety of corporations several with sizable operations in Abilene. Examples include
companies such as Broadwind Energy, Lauren Engineers & Construction and Siemens Energy Inc. to name a few.
Furthermore, downtown Abilene hosts over 700 businesses and 6,000 employees according to City records all of
which generate corporate transient demand that is estimated to be captured by the Proposed Hotel. This segment
represents the largest source of business for local hotels accounting for approximately 50 percent of their market mix.
66
Estimates of Demand Growth
Demand is classified into three categories including: base, displaced and induced demand.
• Base or demonstrated demand is demand generated by existing supply and demand for comparable hotels.
• Displaced demand or “turnaway” demand is generated by travelers who want accommodations in a given
destination but are unable to secure them because the lodging facilities they are seeking are filled. These displaced
guests must defer their stay, settle for less desirable accommodations or seek accommodations outside of the
market area. Displaced demand typically results from weekly and/or seasonal demand patterns. Given the
observed market occupancy patterns of the hotels in the competitive set, A&M has concluded that the displaced
demand is nominal or nonexistent in the Abilene lodging market.
• Induced demand is the demand created by the addition of new lodging supply that offers competitive facilities
designed to cater to a particular segment and attract demand that previously did not exist in the area. The opening
of the Proposed Hotel will bring to the market a type of lodging product that currently does not exist in the city.
Given its new facilities and expanded meeting space offering, coupled with the anticipated strong marketing efforts
from the ACVB, the Proposed Hotel will attract additional room nights in addition to the market’s existing base
demand.
To estimate the future demand for rooms in the comparable lodging market, A&M examined the historical
performance of the overall market, including visitation growth. Utilizing estimated demand growth rates for each
market segment and the current and future room supply, A&M estimated the performance of the lodging market. The
following are key supply and demand growth rate assumptions:
• For the Proposed Hotel, a January 1, 2016 opening date and anticipated stabilization by year 2019.
• One hotel with an aggregate of 300 rooms is anticipated to enter the market. Because no concrete plans for its
development and/or anticipated opening have been announced, we assumed the hotel will enter the market on
January 1, 2016 as well.
67
• According to the Q2 2013 econometric forecast of the U.S. lodging markets from PKF Hospitality Research,
national lodging demand is anticipated to increase at a CAGR of 2.4 percent between 2013 and 2017. This trend is
consistent with the growth experienced by the Abilene lodging market over the last 5 years as noted in the Abilene
Lodging Market Overview section of this report. Furthermore, the national upscale lodging segment is forecasted to
experience an average growth of four percent per year between 2013 and 2017 while annual growth for Small
Metro/Town hotels is estimated at 2.3 percent.
• For the purposes of our analysis, we estimated conservative demand growth rates in line with the forecasted
national growth rates and the 2.5 percent rate of growth experienced by hotels in the City from 2007 to 2012. These
estimates are above the growth rates forecasted by Small Metro/Town hotels and below the forecasted demand
increases for upscale hotels.
The table below illustrates the anticipated phase-in of the assumed additions to the lodging inventory in Abilene and
its impact on the overall comparable room supply.
Changes in Competitive Room Supply
Additional Inventory Phase-In
Name
Number
Percent
2013
of Rooms Competitive
2014
2015
2016
2017
2018
2019
2020
100
Existing Competitive Inventory
100
100%
100
100
100
100
100
100
100
MCM Elegante Suites
175
100%
175
175
175
175
175
175
175
175
123
100%
123
123
123
123
123
123
123
123
117
100%
117
117
117
117
117
117
117
117
Proposed Hotel
250
100%
-
-
-
250
250
250
250
250
Adoba Eco Hotel and Conference Center
300
25%
-
-
-
75
75
75
75
75
Total
550
-
515
515
515
840
840
840
840
840
Future Additions to Supply
68
Utilizing the estimated demand growth rates for each market segment, the estimated future room night demand for
the Abilene lodging market was calculated as shown in the following table:
Abilene Comparable Lodging Market
Aggregate Estimated Demand Base for Local Comparable Set (2013-2020)
Segment
Historical
2013
2014
2015
2016
2017
2018
2019
2020
Corporate Segment
Annual Growth
Base Demand
63,640
2.5%
3.0%
3.0%
3.0%
2.5%
2.5%
2.5%
2.5%
65,231
67,188
69,204
71,280
73,062
74,889
76,761
78,680
Displaced Demand
---
-
-
-
-
-
-
-
Induced Demand
---
-
-
-
1,130
1,130
1,695
1,695
1,130
63,640
65,231
67,188
69,204
72,608
74,192
76,584
78,456
80,029
2.5%
3.0%
3.0%
3.0%
2.5%
2.5%
2.5%
2.5%
46,250
47,406
48,828
50,293
51,802
53,097
54,424
55,785
57,180
Total Segment Demand
-
Leisure Segment
Annual Growth
Base Demand
Displaced Demand
---
-
-
-
-
-
-
-
-
Induced Demand
---
-
-
-
18,481
18,481
21,355
21,355
20,534
46,250
47,406
48,828
50,293
70,476
71,578
75,779
77,140
77,927
2.5%
3.0%
3.0%
4.0%
3.5%
3.0%
2.5%
2.5%
24,069
24,671
25,411
26,173
27,220
28,173
29,018
29,743
30,487
Group Segment
Annual Growth
Base Demand
Displaced Demand
---
-
-
-
-
-
-
-
-
Induced Demand
---
-
-
-
19,235
19,235
19,663
19,663
19,235
24,069
24,671
25,411
26,173
46,582
47,408
48,681
49,406
49,858
Corporate
63,640
65,231
67,188
69,204
72,608
74,192
76,584
78,456
80,029
Leisure
46,250
47,406
48,828
50,293
70,476
71,578
75,779
77,140
77,927
Group
24,069
24,671
25,411
26,173
46,582
47,408
48,681
49,406
49,858
133,960
-
137,308
2.5%
141,427
3.0%
145,670
3.0%
189,666
30.2%
193,178
1.9%
201,044
4.1%
205,002
2.0%
207,814
1.4%
Totals
Total Market Demand
% Change
Market Statistics
Total Rooms Supply
Total Available Room Nights
Market-wide Occupancy
515
515
515
515
840
840
840
840
840
188,490
187,975
187,975
187,975
307,440
306,600
306,600
306,600
307,440
71.1%
73.0%
75.2%
77.5%
61.7%
63.0%
65.6%
66.9%
67.6%
Source: A&M
69
PERFORMANCE ESTIMATES
70
Occupancy Analysis
A&M estimated future occupancy levels for the Proposed Hotel based on the penetration levels in each market
segment relative to its competitors. Penetration is calculated by dividing the number of room nights captured by the
Proposed Hotel by its fair share. Fair share represents the percentage of the Proposed Hotel’s number of rooms in
relation to the total number of rooms in the comparable market. The ratio is then multiplied by the market’s total
estimated room nights by market segment to calculate the Proposed Hotel’s fair share of room nights.
Our occupancy estimates are further based on the Proposed Hotel’s anticipated advantages and disadvantages
relative to the comparable hotels, and the assumption that it will be operated and branded by an internationally
recognized hotel company.
Since the Proposed Hotel will be located next to or near the ACC, it is anticipated to cater primarily to the convention
and meetings business. Given the fact that it will include a fair amount of on-site meeting and function space to
complement the ACC’s facilities, the Proposed Hotel’s penetration of the group demand segment is forecasted above
its fair share in 2016. As operations ramp up and group business bookings increase, the Proposed Hotel’s penetration
is estimated to increase through 2019 when the group segment is forecasted to account for 40 percent of the
Proposed Hotel’s market mix.
As previously noted, corporate and government demand represent the primary source of business for local hotels and
the Proposed Hotel is anticipated to successfully secure corporate negotiated accounts given its strategic location and
more upscale product offering. In addition, the construction of the Proposed Hotel is reportedly being supported by a
number of local businesses that have expressed interest in directing business to the Proposed Hotel upon opening.
As such, the corporate segment is anticipated to account for 32 percent of the Proposed Hotel’s market mix upon
stabilization.
Downtown’s revival as a cultural and entertainment district should also allow the Proposed Hotel to capture a fair
amount of visitors to the area. Consistent with the seasonality trends experienced by local hotels, leisure demand
should help the Proposed Hotel offset the departure of corporate and group business towards the end of the week.
Therefore, we have forecasted the leisure segment to represent 28 percent of the Proposed Hotel’s market
segmentation.
71
The following table presents the calculation of the Proposed Hotel’s market share and total room nights captured from
its assumed opening date in 2016 through 2020.
Estimated Market Share and Penetration by Segment (2016-2010)
Historical
2016
2017
2018
2019
2020
Subject Property Fair Share
Market Room Supply
840
840
840
840
840
Subject Property Room Count
515
-
250
250
250
250
250
Fair Share
-
29.8%
29.8%
29.8%
29.8%
29.8%
Room Nights Captured by Subject
Corporate Segment
Fair Share
-
29.8%
29.8%
29.8%
29.8%
29.8%
Penetration Factor
-
80.0%
80.0%
80.0%
80.0%
80.0%
Market Share
Demand
63,640
23.8%
23.8%
23.8%
23.8%
23.8%
72,608
74,192
76,584
78,456
80,029
Market Share
-
23.8%
23.8%
23.8%
23.8%
23.8%
Capture
-
17,288
17,665
18,234
18,680
19,054
Leisure Segment
Fair Share
-
29.8%
29.8%
29.8%
29.8%
29.8%
Penetration Factor
-
70.0%
70.0%
70.0%
70.0%
70.0%
Market Share
-
20.8%
20.8%
20.8%
20.8%
20.8%
77,927
Demand
70,476
71,578
75,779
77,140
Market Share
46,250
-
20.8%
20.8%
20.8%
20.8%
20.8%
Capture
-
14,682
14,912
15,787
16,071
16,235
Group Segment
Fair Share
-
29.8%
29.8%
29.8%
29.8%
29.8%
Penetration Factor
-
140.0%
146.0%
156.0%
158.0%
158.0%
Market Share
Demand
24,069
41.7%
43.5%
46.4%
47.0%
47.0%
46,582
47,408
48,681
49,406
49,858
Market Share
-
41.7%
43.5%
46.4%
47.0%
47.0%
Capture
-
19,409
20,600
22,602
23,233
23,445
Total Capture
-
51,379
53,177
56,623
57,983
58,734
Source: A&M
72
The estimated occupancies for the Proposed Hotel are calculated by dividing the estimated total number of room
nights captured, by its available number of room nights per year. The Proposed Hotel is anticipated to stabilize in 2019,
its fourth year of operations, following an estimated 24-month development and pre-opening process with a target
opening date of January 2016. The following table presents the estimated occupancy levels for the Proposed Hotel.
Estimated Occupancy, Overall Penetration and Market Share (2016-2020)
Calendar Years
2016
2017
2018
2019
2020
Room Nights Captured
51,379
53,177
56,623
57,983
58,734
Available Room Nights
91,250
91,250
91,250
91,250
91,250
Rounded Occupancy
56%
58%
62%
64%
64%
Overall Penetration
91%
92%
95%
95%
95%
Overall Market Share
27%
28%
28%
28%
28%
Source: A&M
73
Average Daily Rate Estimates
National Consumer Price Index (All Urban Consumers)
Forecasted ADRs are presented in constant 2013 Dollars
and inflated Dollars. In order to account for an accurate
estimated rate of inflation we reviewed historical
increases in the Consumer Price Index (“CPI”). As
illustrated in the table to the right, between 2002 and
2012 the national CPI experienced a CAGR of 2.5
percent and 2.1 percent from 2007 to 2012. The highest
increase was recorded in 2008 at 3.8 percent followed by
a 0.4-percent decrease in 2009. In 2012, the CPI
increased by 2.1 percent. Based on the national trends
experienced over the last decade and during the last few
years, we have assumed an underlying inflation rate of
three percent for the purposes of our ADR and cash flow
estimates (addressed in the following section of the
report) for the Proposed Hotel.
National Consumer
%
Price Index
Change
2002
179.9
1.6%
2003
184.0
2.3%
2004
188.9
2.7%
2005
195.3
3.4%
2006
201.6
3.2%
2007
207.3
2.8%
2008
215.3
3.8%
2009
214.5
-0.4%
2010
218.1
1.6%
2011
224.9
3.2%
2012
229.6
2.1%
YEAR
CAGR (2002-2012):
2.5%
CAGR (2007-2012):
2.1%
Source: Bureau of Labor Statistics
ADR for the Proposed Hotel was estimated based on its
positioning within the local comparable market as well as
the rate trends experienced by the regional comparable
hotels. Given its previously noted advantages, the
Proposed Hotel is estimated to command ADR premiums
over its local competitors and be positioned in line with
the regional comparable hotels upon stabilization, when
the Proposed Hotel is estimated to achieve an ADR of
$126.00 in constant 2013 Dollars. The table to the right
presents A&M’s estimates of ADR stated in constant and
inflated dollars from 2016 to 2020.
Estimated Future Occupancy and Average Daily Rate (2016 - 2020)
Average Daily Rate
Estimated
Constant
Occupancy
2016
2017
2013 Dollars
2013 Dollars
Inflated
Dollars (1)
56%
$118
$129
$66
$73
58%
$121
$136
$70
$79
2018
62%
$123
$143
$76
$89
2019
64%
$126
$150
$80
$95
2020
64%
$126
$154
$81
$99
Year
(1)
RevPAR
Inflated
Dollars (1)
Constant
Inflation assumed at 3.0 percent per annum.
Source: A&M
74
CONVENTION OVERFLOW
ANALYSIS
75
CONVENTION OVERFLOW ANALYSIS
Lost Convention Business
The ACVB tracks groups that have demonstrated interest in
holding a convention event at the ACC but that ultimately
decided not to bring their business to Abilene for various
reasons. Such events are referred to as lost business. The lost
business report includes information such as the name of the
group, the proposed dates of the events and estimates of
attendance, room nights generated, and economic value. In
addition, it lists multiple reasons for the lost events including the
lack of enough hotel rooms to host the group. The table to the
right summarizes the ACVB’s lost business statistics by the
reason attributable to the loss for the period 2004 through YTD
June 2013.
The amount of lost business due to the selection of another city
totaled 37,755 attendees, 38,777 room nights, and represented
over 70 percent of the overall business lost. It is important to
note that 86.4 percent of the business in this category was lost to
other cities in TX, 11.2 percent did not report the city and only
2.4 percent of the business was lost to out-of-state cities. A total
of 23,986 room nights or nearly 62 percent of the business in this
category was lost to cities other than large metro areas such as
Dallas, Houston, Austin and San Antonio.
ACVB Convention Sales
Business Turned Lost (2004-YTD June 2013)
Reason
Attendance Room Nights
Lost to Another City
(1)
38,777
$12,210,279
Insufficient Hotel Rooms
5,050
8,275
1,438,650
Lack of Local Support
1,775
4,765
$779,925
Other
1,700
1,105
$242,475
800
885
$289,200
550
47,630
675
54,482
$90,327
$15,050,856
Air Service
Hotel Rates Too High
Total
(1)
The majority of the events did not provide a specific reason for the
selection of a different city.
Source: ACVB
ACVB Convention Sales
Reasons Attributable to Business Turned Lost (% of Room Nights Lost)
Hotel Rates Too High
1.2%
Air Service
1.6%
Other
2.0%
Lack of Local Support
An important statistic is the amount of lost business due to the
lack of hotel rooms either in close proximity to the ACC or
sufficient to accommodate groups in a single property. As
illustrated in the chart to the right, this category represented 15.2
percent of the total business lost which accounted for 8,275
room nights and approximately $1.5 million in economic value.
$ Value
37,755
Insufficient Hotel
Rooms
8.7%
15.2%
Lost to Another City
0.0%
Source: ACVB
71.2%
20.0%
40.0%
60.0%
80.0%
Occupancy %
76
Lodging Demand Overflow Analysis
When a new hotel enters the lodging market, the additional room supply tends to put pressure on the occupancy
levels of the hotels in the Comp Set, primarily during the initial years of its operation, while the latent demand is
absorbed by the new supply. Therefore, new competition is not always perceived positively by the existing hotels in
the market place.
However, in addition to the induced demand generated by the Proposed Hotel, its development would allow the ACVB
to be more competitive and effective when bidding for new convention business. Assuming the ACVB is able to
successfully translate its marketing efforts into new bookings, the city would benefit from the group demand increase
and the economic impact associated with it, while the area hotels would profit from the room night overflow that would
not be able to be accommodated in a single hotel. In order to quantify the potential convention business overflow,
A&M analyzed the relationship between lost convention business, potential new convention business and the local
Comp Set hotels’ fair share and occupancy levels.
As noted in the Lost Convention Business section, 8,275 convention room nights were lost due to the lack of hotel
rooms either in close proximity to the ACC or sufficient to accommodate groups in a single property representing 15.2
percent of the total room nights lost. In addition, 38,777 room nights were lost to other cities out which 23,986 were
lost against regional convention markets that compete against Abilene outside the large metro areas. It is important to
note that the majority of the events did not list the specific reason why a different city was selected instead of Abilene.
As such, A&M assumed that at least one third of the business lost to regional markets was directly associated with the
lack of a hotel adjacent to the ACC, representing 7,915 rooms nights. When combined, the estimated lost business in
this category totals 16,190 rooms nights or approximately 30 percent of the total business lost.
The ACVB maintains a list of potential conventions that the City should be able to bid and compete for successfully if
the Proposed Hotel is developed. The list identifies a total of 123 companies which hold annual and semiannual
conventions, with an estimated potential to generate 69,163 room nights per year. A copy of this list is included in the
Appendix section of the report.
77
Lodging Demand Overflow Analysis – cont’d
For the purposes of this analysis, A&M has assumed that 30 percent of the total potential convention room nights
identified by the ACVB could be secured if the Proposed Hotel was developed. This estimate is based upon the
finding that approximately one third of the convention room nights are lost due to the lack of a hotel adjacent to the
ACC as previously noted. The ACVB indicated that it has developed and maintains good relationships with the
majority of the meeting planners that organize the identified events. As a result, the Bureau feels confident in its ability
to book the vast majority of them. Despite the aforementioned, we have made the conservative assumption that not
every one of these events will be booked as the meeting planners may have other considerations outside the lack of a
downtown hotel to book their groups in alternative destinations.
Based on the assumed booking rate of 30 percent, the potential number of room nights that could be brought to the
market and contribute overflow business to the hotels in the local Comp Set was estimated at 20,749.
As illustrated in the table below, the occupancy levels in the local Comp Set were estimated at 62 percent in 2016, the
assumed opening year for the Proposed Hotel. Such decrease is nine percentage points below the Comp Set’s
estimated 2012 occupancy of 71 percent, excluding the Proposed Hotel. Assuming each hotel would capture its fair
share of the estimated overflow demand, overall Comp Set occupancies would increase to approximately 70 percent,
offsetting the effects of the additional supply brought by the Proposed Hotel.
Convention Business Overflow Analysis
Number of
Rooms
Available
Room Nights
Fair Share
Estimated
2012
Occupancy
100
36,600
13%
60%
55%
20,130
2,712
22,842
62%
MCM Elegante Suites
175
64,050
23%
70%
63%
40,352
4,746
45,098
70%
123
45,018
16%
75%
68%
30,612
3,336
33,948
75%
117
Proposed Hotel
250
OVERALL COMP SET
765
42,822
91,500
279,990
15%
33%
100%
78%
N/A
71%
71%
56%
62%
30,404
51,240
172,737
3,173
6,781
20,749
33,577
58,021
193,486
78%
63%
69%
Hotel
Estimated
2016
Overflow
Adjusted
Adjusted
2016
Occupied
(Room Nights Occupied
2016
Occupancy Room Nights
Captured)
Room Nights Occupancy
Source: A&M
78
5-YEAR CASH FLOW ESTIMATES
79
Projected revenues and expenses are based on our estimates of occupancy and ADR for the Proposed Hotel as well
as the performance results for comparable hotels as reported by STR. A copy of the comparable hotels’ 2012
operating performances is included in the Appendix section of the report. The following table summarizes the
anticipated cash flows for the Proposed Hotel.
Abilene, TX
Forecasted Cash Flows
2016
Days per year
Number of Rooms
Available Rooms
Occupied Room Nights
Occupancy Rate
Average Daily Rate
2017
366
250
91,500
51,240
56.0%
$128.85
ADR Variance
RevPAR
2018
365
2019
365
250
91,250
52,925
58.0%
$135.29
2020
365
250
91,250
56,575
62.0%
$141.38
366
250
91,250
58,400
64.0%
$147.04
250
91,500
58,560
64.0%
$151.45
-
5.0%
4.5%
4.0%
3.0%
$72.16
$78.47
$87.66
$94.10
$96.93
-
8.7%
11.7%
7.4%
3.0%
RevPAR Variance
Amount
%
6,602,381
1,793,400
363,804
138,348
4,099
25,620
12,810
2,562
73.8%
PAR
26,410
POR
128.85
20.1%
7,174
35.00
4.1%
1,455
7.10
1.5%
553
2.70
0.0%
16
0.08
0.3%
102
0.50
0.1%
51
0.25
0.0%
10
$8,943,024
100.0%
28.0%
1,848,667
80.0%
1,836,442
63,538 1550.0%
76.0%
19,471
Amount
%
PAR
POR
Amount
%
PAR
POR
Amount
%
PAR
POR
Amount
%
PAR
POR
Revenue
Rooms
Food
Beverage
Other Food and Beverage
Telecommunications
Other Operated Departments
Rentals & Other Income
Cancellation Fee
Total Revenue
74.4%
28,642
135.29
19.7%
7,571
35.76
4.0%
1,536
7.25
1.5%
584
2.76
0.0%
17
0.08
0.3%
107
0.51
0.1%
53
0.25
0.05
7,160,472
1,892,760
383,960
146,013
4,347
26,866
13,281
2,726
74.9%
31,995
141.38
19.2%
8,205
36.26
3.9%
1,664
7.35
1.5%
633
2.80
0.0%
19
0.08
0.3%
115
0.51
0.1%
55
0.25
0.05
7,998,741
2,051,190
416,099
158,235
4,756
28,737
13,873
3,001
0.0%
11
$35,772
$174.53
$9,630,425
100.0%
7,395
36.08
7,346
35.84
254
1.24
78
0.38
27.2%
1,944,449
79.1%
1,917,193
66,122 1521.0%
75.3%
20,237
75.3%
34,348
147.04
19.0%
8,660
37.07
3.8%
1,757
7.52
1.5%
668
2.86
0.0%
20
0.09
0.3%
121
0.52
0.1%
58
0.25
0.05
8,587,035
2,165,075
439,201
167,020
5,043
30,147
14,389
3,191
0.0%
12
$38,522
$181.96
$10,674,632
100.0%
7,778
36.74
7,669
36.22
264
1.25
81
0.38
25.9%
2,072,609
77.4%
2,031,957
69,618 1463.7%
73.9%
21,248
75.3%
35,476
151.45
19.0%
8,939
38.16
3.8%
1,813
7.74
1.5%
690
2.94
0.0%
21
0.09
0.3%
124
0.53
0.1%
59
0.25
0.05
8,868,878
2,234,754
453,336
172,395
5,207
31,101
14,830
3,295
0.0%
13
0.0%
13
$42,699
$188.68
$11,411,101
100.0%
0.06
$45,644
$195.40
$11,783,797
100.0%
$47,135
$201.23
8,290
36.63
8,128
35.92
278
1.23
85
0.38
25.3%
2,173,801
76.6%
2,122,398
72,485 1437.5%
73.3%
22,094
8,695
37.22
38.28
36.34
8,755
37.38
290
1.24
299
1.28
88
0.38
25.3%
2,241,729
76.5%
2,188,733
74,730 1435.2%
73.2%
22,776
8,967
8,490
Departmental Expenses (1)
Rooms
Food & Beverage
Telecommunications
91
0.39
Total Departmental Expenses
$3,768,117
42.1%
$15,072
$73.54
$3,948,000
41.0%
$15,792
$74.60
$4,195,432
39.3%
$16,782
$74.16
$4,390,779
38.5%
$17,563
$75.18
$4,527,967
38.4%
$18,112
$77.32
Departmental Income
$5,174,907
57.9%
$20,700
$100.99
$5,682,424
59.0%
$22,730
$107.37
$6,479,199
60.7%
$25,917
$114.52
$7,020,322
61.5%
$28,081
$120.21
$7,255,829
61.6%
$29,023
$123.90
892,500
650,000
407,500
470,000
10.0%
3,570
17.42
3,701
17.48
3,866
17.08
4,010
17.17
4,133
17.64
2,696
12.73
6.6%
2,816
12.44
6.4%
2,920
12.50
6.4%
3,010
12.85
4.4%
1,690
7.98
4.1%
1,765
7.80
4.0%
1,831
7.84
4.0%
1,887
8.06
5.3%
1,880
9.17
5.1%
1,949
9.21
4.8%
2,036
9.00
4.6%
2,112
9.04
1,033,217
752,483
471,749
544,103
8.8%
7.0%
7.95
1,002,514
730,122
457,731
527,935
8.8%
12.69
1,630
966,570
703,945
441,319
509,006
9.1%
2,600
4.6%
925,321
673,903
422,485
487,284
9.6%
7.3%
4.6%
2,176
9.29
Total Undistributed Expenses
$2,420,000
27.1%
$9,680
$47.23
$2,508,994
26.1%
$10,036
$47.41
$2,620,840
24.6%
$10,483
$46.33
$2,718,302
23.8%
$10,873
$46.55
$2,801,552
23.8%
$11,206
$47.84
Gross Operating Profit (before fees)
$2,754,907
30.8%
$11,020
$53.76
$3,173,431
33.0%
$12,694
$59.96
$3,858,359
36.1%
$15,433
$68.20
$4,302,020
37.7%
$17,208
$73.66
$4,454,277
37.8%
$17,817
$76.06
Undistributed Operating Expenses
Administrative & General
Sales & Marketing
Utility Costs
Property Operations & Maintenance
Fees
Franchise Fees (Royalty)
Management Fees
Total Fees
Income Before Fixed Charges
223,576
268,291
2.5%
1,156
5.46
3.0%
1,281
5.66
3.0%
1,369
5.86
294,595
353,514
2.5%
3.0%
285,278
342,333
2.5%
5.24
266,866
320,239
2.5%
1,073
240,761
288,913
2.5%
3.0%
3.0%
1,414
6.04
$491,866
5.5%
$1,967
$9.60
$529,673
5.5%
$2,119
$10.01
$587,105
5.5%
$2,348
$10.38
$627,611
5.5%
$2,510
$10.75
$648,109
5.5%
$2,592
$11.07
$2,263,041
25.3%
$9,052
$44.17
$2,643,757
27.5%
$10,575
$49.95
$3,271,255
30.6%
$13,085
$57.82
$3,674,409
32.2%
$14,698
$62.92
$3,806,168
32.3%
$15,225
$65.00
308,750
92,500
178,860
3.5%
1,235
6.03
1,272
6.01
1,310
5.79
1,350
5.78
347,501
104,110
471,352
2.9%
1,390
5.93
3.49
337,379
101,077
456,444
3.0%
1.81
715
327,553
98,133
426,985
3.1%
370
2.0%
318,013
95,275
288,913
3.3%
1.0%
894
4.36
963
4.55
1,067
4.72
1,141
4.88
1,178
5.03
Fixed Expenses
Property Taxes
Insurance
Reserve for Replacement
Total Fixed Expenses
Amount Available for Debt Service & Other Fixed Charges (2)
(1)
(2)
1.0%
381
1.80
3.0%
1,156
5.46
0.9%
393
1.73
4.0%
1,708
7.55
0.9%
404
1.73
4.0%
1,826
7.82
0.9%
416
1.78
4.0%
1,885
8.05
$580,110
6.5%
$2,320
$11.32
$702,200
7.3%
$2,809
$13.27
$852,671
8.0%
$3,411
$15.07
$894,901
7.8%
$3,580
$15.32
$922,962
7.8%
$3,692
$15.76
$1,682,930
18.8%
$6,732
$32.84
$1,941,557
20.2%
$7,766
$36.69
$2,418,583
22.7%
$9,674
$42.75
$2,779,509
24.4%
$11,118
$47.59
$2,883,206
24.5%
$11,533
$49.24
Ratio to Sales for departmental expenses are based on their respective departmental revenues. All other expense ratios are based on total revenue.
Other Fixed Charges include Depreciation and Amortization, Interest, Rent, and Equipment Leases.
Source: A&M
80
Operating Ratios
Rooms Department
• Rooms departmental revenues are derived from the rental of sleeping rooms at the hotel, net of any rebates and
discounts, and are based on the occupancy and average rate estimates presented earlier in this report.
• Rooms departmental expenses consist of payroll and related expenses and other departmental expenses. Rooms
payroll and related expenses generally consist of salaries and wages directly associated with operating the rooms
department including reservation system charges, housekeeping and front desk. Other expenses often include
travel agent commissions, guest supplies, paper goods, cleaning supplies, laundry, linen and other items for
maintaining guest rooms. Total rooms departmental expenses were estimated at 28 percent of the hotel room
revenues for the Proposed Hotel during the first year of operations, stabilizing at 25.3 percent of room revenues as
departmental operations become more efficient year over year.
Food and Beverage Department
• Food and Beverage (“F&B”) revenues are derived from the sale of food, including coffee, milk, tea and soft drinks,
and the sale of beverages, including beer, wine and liquors. Food revenue was estimated at 20.1 percent of total
revenues, while beverage revenue was calculated at 4.1 percent of total revenues.
• Other F&B revenues are derived from other sources such as meeting room rentals, cover or service charges, or
revenues derived from the sale of goods or services made in connection with banquets, such as equipment rental,
music, decorations and souvenirs. It also includes banquet service charges. Total Other F&B revenues were
estimated at 1.5 percent of total revenue.
• F&B departmental expenses include the cost of goods sold (food and beverages), payroll and other related
operating expenses. Other F&B expenses generally include items such as china, linen, glass and silverware,
entertainment, cleaning supplies, paper supplies, menus, laundry and kitchen fuel. Total food and beverage
departmental expense was estimated at approximately 80 percent of total F&B revenues for the Proposed Hotel,
stabilizing at 76.5 percent in 2019.
81
Operating Ratios – cont’d
Telecommunications Department
• Telecommunications revenues are derived from guest-use of telephones in the hotel, including local and long
distance calls, service charges, commissions received from pay phones and Wi-Fi Internet service. Our analysis of
comparable hotel performances indicates the Telecommunication department does no longer represent a
meaningful source of revenue to hotels and in most instances the department operates at a loss or break even at
best. This is particularly evident given the fact that many hotels now offer complimentary local calls (sometimes
even long distance calls) and Wi-Fi service to guests. As such, we have estimated departmental revenues at 0.05
percent of total revenue.
• Telecommunications departmental expenses include cost of calls, labor cost of operators, and other related
expenses, but excludes capital lease payments. These expenses were estimated at 1,550 percent of total
telephone revenues, mainly based on the performance reported by a set of comparable properties that included the
Hilton Waco, the Holiday Inn Lubbock Hotel & Towers and the Overton Hotel and Conference Center among
others.
Other Operated Departmental and Rentals
• Other Operated Departments revenues are generated from garage and parking, guest laundry, golf and tennis,
health club, spa, swimming pool, barber/beauty shop, gift shop, newsstand, etc. when operated by the hotel. For
the Proposed Hotel, we have estimated Other Departmental Revenue at 0.3 percent of total revenue.
• Rentals and Other revenue includes income from rentals of space for business purposes, including concessions in
any of the departments mentioned under other operated departments. It also includes income generated from
sources not included elsewhere, but excludes investment income. This represents 0.2 percent of total revenue,
including revenue associated with Cancellation Fees.
• Other Operated Departments & Rentals expenses would comprise those expenses (labor and other) which offset
the revenue generated by other operated departments such as garage, guest laundry, athletic facilities and gift
shop, as well as rental activity. These expenses represent 76 percent of total departmental revenues.
82
• Administrative and General (“A&G”) expenses are comprised of payroll costs associated with managerial and
administrative staff, including the general manager’s office, accounting and personnel department. Additional
expenses generally include items such as office supplies, computer services, accounting and legal fees, cash
overages and shortages, bad debt expenses, travel insurance, credit card commissions, transportation (non-guest)
and travel and entertainment. Total A&G expenses were estimated at 10 percent of total revenue for the Proposed
Hotel and forecasted to stabilized at 8.8 percent as the operations ramp up.
• Sales & Marketing (“S&M”) expenses include all expenses related to the advertising and promotion of the property
including payroll expenses for the director of marketing, sales managers and clerical support as well as other
expenses associated with outside agency fees. Marketing expenses were estimated at 7.3 percent of total
revenues during the first year of operations to account for the need to execute a strong advertising and sales
campaign to promote the Proposed Hotel in its initial years of operations. As the Proposed Hotel penetrates and
builds recognition and awareness in the lodging market, the S&M expenses are estimated to stabilize at 6.4 percent
of total revenue.
• Utility costs typically include electricity, fuel (oil, gas and coal), purchased steam, and water representing 4.6
percent of total revenues upon opening and stabilizing at four percent of total revenue. Following stabilization, the
Proposed Hotel’s facilities will eventually become less energy efficient and potentially contribute to higher energy
costs.
• Property Operations and Maintenance (“POM”) expenses include payroll costs associated with managerial and staff
positions in the department. Other expenses generally include expenditures for periodic preventive maintenance,
repairs to mechanical equipment, painting and decorating, grounds maintenance and the supplies necessary to
operate this department. The age of a lodging facility strongly influences the required level of maintenance.
Furthermore, the quality of initial construction can also have a direct impact on future maintenance requirements.
For the purposes of our analysis, POM expenses were estimated at 5.3 percent of total revenue and were
anticipated to stabilize at 4.6 percent of total revenue. These expenses may increase as the Proposed Hotel ages
and experiences higher levels of utilization and general wear and tear of property plant and equipment.
83
Undistributed Operating Expenses – cont’d
• Franchise fees includes only the royalty fees charged by franchise companies. This fee was estimated at 2.5
percent of total revenues. Typically, franchise agreements for upscale hotels provide for royalty fees ranging
between three and five percent of Rooms revenue.
• Management fees consists of fees charged by management organizations for services associated with the
management and supervision of the hotel operations. This expense category includes both base and incentive
fees. For the purpose of this analysis a management fee of three percent was assumed for the Proposed Hotel.
Fixed Charges
• Property taxes include taxes assessed on real estate, business and occupation, personal property, utilities, and
other municipal taxes. These amounts can differ substantially on a property-by-property basis as real estate taxes
may be either waived by the local authorities or reduced during the initial years of operation as an incentive to
attract investment to the region. The property taxes for the Proposed Hotel were estimated at 3.5 percent of total
revenues.
• Insurance expense is associated with the cost of premiums for adequate insurance protection of the hotel and its
contents against damage or destruction by fire, weather, boiler explosion, etc. General insurance costs also include
premiums relating to liability, fidelity and theft coverage. Insurance costs for building and liability were estimated at
approximately one percent of total revenue.
• Reserve for capital replacement is defined as the amount allocated for the replacement of furniture, fixtures and
equipment (“FF&E”). This category includes all non-real estate items that are capitalized, rather than expensed.
Periodic replacement of FF&E is essential to maintain the quality, image and income-producing potential of a
lodging facility. Due to the Proposed Hotel’s new construction, we have assumed an escalating reserve for
replacement of two percent of total revenue for the first year of operations, three percent in the second year and
four percent of total revenue in the third year and thereafter.
84
FACILITIES AND SERVICES
RECOMMENDATIONS
85
FACILITIES AND SERVICES RECOMMENDATIONS
The Proposed Hotel should offer facilities and a range of services and amenities commensurate with the standards of
an upper-upscale, full-service lodging brand. Based on the anticipated type and product quality of the Proposed Hotel,
as well as the target market (group and convention demand) and proximity to the ACC, our recommended facilities
and amenities are as follows:
Lobby and Public Areas
The lobby area should offer a personalized reception area that facilitates interaction between employees and guests.
It should also include a lounge and/or a reading area that promotes a social lobby concept, and adequate and
strategically located restrooms (taking into consideration guests and restaurant patrons). Complimentary Wi-Fi
Internet access should also be offered to guests.
The Proposed Hotel’s entrance should provide guests with a sense of arrival and a strong first impression. It should
also facilitate traffic flow and provide easy and safe access to the property from the road particularly when large
groups check into the hotel. Buses for groups could use the ACC’s entrance, however, well-designed walkways
leading to the Proposed Hotel should be offered.
Adequate complimentary self-parking for guests should be available. Although some of the potential sites for
development may be suitable for additional parking, it is important for the Proposed Hotel to offer onsite parking which
may be complemented with the ACC’s parking facilities.
Guestrooms
Guestrooms at the Proposed Hotel should be medium-sized and able to facilitate multiple occupancy. In-room
entertainment and wireless Internet service are mandatory to enhance the lodging experience and remain competitive
with hotels in both the local and regional lodging market. Room layouts should be configured to maximize space and
optimize work capabilities, as many guests will need to review meeting materials and perform tasks related to
business. In general, guestroom characteristics should include:
• 240 standard rooms of approximately 360 to 380 SF and 10 executive suites of approximately 760 SF;
• A 60/40 ratio of double rooms versus king rooms to accommodate the high demand of group segment demand;
86
Guestrooms – cont’d
• Two telephones with private voicemail, one located on a night stand and one at the work station;
• Oversized work stations equipped with complimentary wireless Internet access and remote printing capabilities,
desk lamps, ergonomic chairs and ample electrical outlets;
• A separate sitting area with a side table and a lamp to allow for guests’ relaxation;
• Entertainment center featuring 35” to 37” flat screen TVs with in-room entertainment options;
• Electronic in-room safe to store valuables;
• Clock radio with mp3/iPod connectivity;
• Bathroom with two sinks, granite counter tops and hair dryer.
• Ample closet space;
• Iron and ironing board; and
• Coffee makers.
Food and Beverage Outlets
F&B outlets are critical support facilities of the hotel for both group and non-group travelers. In addition, due to the
downtown location of the Proposed Hotel, F&B venues should be designed to accommodate additional non-guest
patronage from the area. A&M’s F&B facilities recommendations include:
• Restaurant – The food outlet at the Proposed Hotel should offer a casual dining experience for both guests and
patrons within the community. It is expected to be open for breakfast, lunch and dinner service, and offer in-room
dining service until 11:00PM at minimum. The restaurant kitchen and staff should be able to efficiently handle a
large number of guests at once, especially when meeting sessions are over. The restaurant space should feature
smaller rooms that can be separated from the main dining area to host private parties. High levels of attention to
food service and quality should be paid by management as the restaurant will be an important and visible business
in Downtown Abilene.
• Lounge – Similar to the restaurant, the beverage outlet at the Proposed Hotel will serve the needs of both hotel
guests and resident patrons and should offer a relaxing, casual atmosphere. The lounge is expected to be open
from afternoon to late evening and should feature a limited food menu, several televisions, and an evening
wine/social hour.
87
Meeting Facilities
Due to its proximity to the ACC, the Proposed Hotel is expected to be the primary lodging option for groups needing
meeting space in Abilene. As such, our review of the lodging supply in the comparable regional market in addition to
our understanding of Abilene’s meetings and conventions market indicates the Proposed Hotel should offer +12,500
SF of function space in addition to +1,200 SF of pre-function space, including the following features:
•
•
•
•
•
•
•
•
Divisible partitions for maximized space flexibility;
Cutting edge teleconferencing and videoconferencing capabilities in select meeting rooms;
Audiovisual and other multimedia capabilities as well as sound and lighting controls in all meeting rooms;
Dataports featuring Internet access and power outlets for meeting guests;
High ceilings in rooms, superior furniture and ergonomic chairs to enhance comfort of meeting attendees;
Ample pre-function and social spaces for impromptu meetings and networking;
Complimentary Wi-Fi Internet access in all meeting areas; and
Well-designed and strategically-located back-of-the-house areas for efficient banquet and event F&B service.
A breakdown of the overall recommended meeting space and approximate capacities is illustrated in the table below:
Approximate Meeting Space Capacities
Meeting Room
Main Ballroom
Ballroom A
Area
(Square Feet)
Seating Style
Ceiling
Hight (Feet)
Banquet
(10-Top)
Theater
Reception
Hollow
Square
U-Shape
Conference
Classroom
10,650
20 - 25
1,050
705
975
-
-
-
525
3,550
20 - 25
350
235
325
100
85
70
175
Ballroom B
3,550
20 - 25
350
235
325
100
85
70
175
Ballroom C
3,550
20 - 25
350
235
325
100
85
70
175
1,850
14 - 16
184
124
170
54
46
38
90
925
14 - 16
92
62
85
27
23
19
45
925
14 - 16
92
62
85
27
23
19
45
1,200
18 - 22
-
-
-
-
-
-
-
Additional Room
Room A
Room B
Pre-Funcion Space
Source: A&M
88
Additional Facilities and Services
The Proposed Hotel should feature standard recreational facilities as found in comparable hotels, which include:
• Outdoor Pool – The Proposed Hotel should feature an outdoor swimming pool on the main level which should be
visible from the lobby area and be designed to generate interest from both meeting attendees as well as transient
leisure and corporate guests. The pool should be complemented by a hot tub in addition to lounge chairs and towel
service.
• Fitness Center – A 24-hour exercise room serving the basic fitness needs of guests and featuring standard
cardiovascular equipment, such as treadmills, stationary bikes, and elliptical machines. It should also include
single-station workout machines, workout mats, Swiss and medicine balls, free weights and a complimentary water
and towel station.
• Business Center – A 24-hour business center fully equipped with internet-ready computer stations, copier and fax
machines, as well as complimentary printing service.
89
Branding
Branding is an important factor to be considered since the Proposed Hotel’s market orientation will target a more
specialized type of clientele. A 2013 survey of 212 meeting professionals across the country conducted by Meetings
and Conventions (“M&C”) showed that only one percent of meeting planners indicated that a hotel’s brand is not at all
important when selecting a hotel for a meeting. Conversely, 22 percent of respondents considered brand affiliation an
extremely important factor in site-selection decisions. In addition, a hotel brand would offer the following benefits to
the Proposed Hotel:
• Network – Brands typically have access to a large guest/client history database and/or guest reward program to
help generate guest and prospect flow to the Proposed Hotel in all demand segments. These companies offer
market knowledge and expertise, and have presence in group demand destinations in the region. The Proposed
Hotel should benefit from all these factors which are particularly important during the first years of operation.
• Guest Loyalty – Well-established brands typically benefit from an existing high level of guest loyalty, facilitating the
credibility-building within the market. Moreover, 54 percent of M&C’s survey respondents indicated previous
experience with a hotel brand is very influential in future decisions to select the same brand.
• Expertise – Many of these brands manage lodging facilities situated in major convention markets nationwide and
have experience operating in the fast-paced, group demand environment. Their operating standards and quality of
service should enhance the group experience and generate recurring business. In addition, a brand would be more
likely to evaluate the potential operation of the ACC, an option that reportedly may be considered by the City during
an RFP process and that would improve business and operational synergies between the two facilities.
• Financing – Branded hotels are typically easier to finance because the brands’ access to a robust distribution
system minimizes the risk associated with generating demand, making sources of equity and debt more
comfortable with the investment rationale.
90
APPENDIX
91
2013 STR U.S. LODGING CHAIN SCALES
Luxury
Affina
AKA
Andaz
Capella
Conrad
Dorchester Collection
Doyle Collection
Fairmont
Firmdale
Four Seasons
Grand Hyatt
Helmsley Hotel
InterContinental
JW Marriott
Langham
Loews
Luxury Collection
Mandarin Oriental
Mokara Hotel & Spa
Montage
Orient Express
Park Hyatt
Ritz‐Carlton
RockResorts
Rosewood
Sofitel
St Regis
Taj
The Peninsula
The Prince
Thompson Hotels
Trump Hotel Collection
Viceroy
W Hotel
Waldorf=Astoria
Luxury
Upper Upscale
Ace Hotel
Autograph Collection
Camino Real
Club Quarters
Dolce
Dream
Embassy Suites
Gaylord
Hard Rock
Hilton
Hilton Grand Vacations
Hyatt
Joie De Vivre
Kimpton
Le Meridien
Marriott
Marriott Conference Center
Marriott Executive Apartments
Millennium
New Otani
Nikko
Omni
Pan Pacific
Radisson Blu
Red Carnation
Renaissance
Sheraton Hotel
Sonesta Hotel
St Giles Hotel
Starhotels
Swissotel
Warwick Ho
Source: Smith Travel Research
Upscale
aloft Hotel
Ascend
Aston Hotel
Best Western Premier
Cambria Suites
Canad Inn
Club Med
Coast Hotel
Courtyard
Crowne Plaza
Disney
DoubleTree
element
Four Points
Grand America
Great Wolf Lodge
Hilton Garden Inn
Homewood Suites
Hotel Indigo
Hyatt House
Hyatt Place
Jolly
Larkspur
Legacy Vacation Club
Melia
Miyako Hotels & Resorts
Novotel
NYLO Hotel
O’Callaghan
Outrigger
Park Plaza
Prince Hotel
Radisson
Residence Inn
Room Mate
Sonesta ES Suites
Springhill Suites
Staybridge Suites
Upper Midscale
3 Palms
Ayres
Best Western Plus Boarders Inn & Suites
Boulders Inn & Suites
Chase Suites
Clarion
Comfort Inn
Comfort Suites
Country Inn & Suites
Doubletree Club
Drury Inn
Drury Inn & Suites
Drury Lodge
Drury Plaza Hotel
Drury Suites
Fairfield Inn
Golden Tulip
Hampton Inn
Hampton Inn & Suites
Holiday Inn
Holiday Inn Express
Holiday Inn Select
Home2 Suites by Hilton
Isle of Capri
Larkspur Landing
Lexington
Night
OHANA
Park Inn
Phoenix Inn
Ramada Plaza
Silver Cloud
Sunspree Resorts
Tryp by Wyndham
TownePlace Suites
Westmark
Wyndham
Midscale
A Victory Hotels
America`s Best Suites
AmericInn
Baymont Inn & Suites
Best Western Cabot Lodge
Candlewood Suites
Centerstone Hotels
ClubHouse
Cobblestone
Crossings by GrandStay
Crystal Inn
GrandStay Residential Suites
Hawthorn Suites by Wyndham
Howard Johnson
InnSuites Hotel
Lakeview Distinctive Hotels
La Quinta Inn & Suites
MainStay Suites
Oak Tree Inn
Quality Inn Ramada
Red Lion
Rode Inn
Settle Inn
Shilo Inn
Signature Inn
Sleep Inn
Vagabond Inn
Vista
Wingate by Wyndham
Economy
Affordable Suites of America
America`s Best Inn
Americas Best Value Inn
Budget Host
Budget Suites of America
Budgetel
Country Hearth Inn
Crestwood Suites
Crossland Suites
Days Inn
Downtowner Inn
Econo Lodge
Extended Stay America
Extended Stay Deluxe
E‐Z 8
Family Inns of America
Good Nite Inn
Great Western
GuestHouse Inn
HomeGate
Homestead
Home‐Towne Suites
Howard Johnson Express
InTown Suites
Jameson Inn
Key West Inn
Knights Inn
Lees Inn Of America
Master Hosts Inns
Masters Inn
Microtel Inn
Motel 6
National 9
Passport Inn
Pear Tree Inn
Red Carpet Inn
Red Roof Inn
Road Star Inn
Rodeway Inn
Savannah Suites
Scottish Inn
Select Inn
Studio 6
Studio Plus
Suburban Extended Stay
Sun Suites Extended Stay Hotel
Super 8
Travelodge
Value Place
Yotel
92
COMPARABLE HOTELS 2012 OPERATING PERFORMANCE
SMITH TRAVEL RESEARCH - 2013 HOST DATA
CUSTOM HOST
Average Number of Rooms
Occupancy Rate
Average Daily Room Rate (ADR)
RevPAR
WEST SOUTH CENTRAL
SMALL METRO/TOWN
UPSCALE HOTELS
259
175
104
155
63.2%
67.7%
63.9%
71.4%
$113.39
$ 114.09
$ 108.44
$ 117.31
$71.66
$ 77.29
$ 69.29
$ 83.76
%
PAR
POR
%
PAR
POR
%
PAR
POR
%
PAR
POR
Rooms
73.6%
$26,268
$113.39
72.2%
$28,062
$114.09
77.3%
$25,195
$108.44
85.5%
$30,196
$117.31
Food
19.6%
$7,001
$30.22
15.4%
$5,986
$24.34
11.7%
$3,800
$16.36
7.7%
$2,720
$10.57
Beverage
4.5%
$1,598
$6.90
3.8%
$1,472
$5.98
3.2%
$1,049
$4.51
1.8%
$625
$2.43
Other Food and Beverage
1.8%
$625
$2.70
4.0%
$1,545
$6.28
2.1%
$689
$2.97
2.0%
$722
$2.81
Telecommunications
0.0%
$17
$0.08
0.5%
$193
$0.79
0.1%
$42
$0.18
0.2%
$55
$0.21
0.3%
$106
$0.46
3.0%
$1,160
$4.72
4.3%
$1,401
$6.03
2.2%
$794
$3.08
Rentals & Other Income
0.2%
$58
$0.25
1.0%
$391
$1.59
1.2%
$378
$1.63
0.5%
$190
$0.74
Cancellation Fee
0.0%
$6
$0.03
0.2%
$78
$0.32
0.1%
$23
$0.10
0.1%
$18
$0.07
100.0%
$35,678
$154.01
100.0%
$38,888
$158.11
100.0%
$32,577
$140.22
100.0%
$35,320
$137.21
Revenue
Total Revenue
Departmental Expenses (1)
Rooms
25.2%
$6,618
$28.57
23.3%
$6,532
$26.56
24.9%
$6,286
$27.06
24.9%
$7,519
$29.21
Food & Beverage
76.2%
$7,024
$30.32
65.8%
$5,927
$24.10
79.6%
$4,407
$18.97
81.4%
$3,311
$12.86
1,436.4%
$251
$1.08
149.3%
$289
$1.17
413.6%
$175
$0.75
320.4%
$176
$0.68
73.7%
$78
$0.34
45.4%
$740
$3.01
60.5%
$1,090
$4.69
39.4%
$395
$1.53
Total Departmental Expenses
39.2%
$13,971
$60.31
34.7%
$13,488
$54.84
36.7%
$11,958
$51.47
32.3%
$11,401
$44.29
Departmental Profit
60.8%
$21,707
$93.70
65.3%
$25,400
$103.27
63.3%
$20,620
$88.75
67.7%
$23,919
$92.92
$12.61
Telecommunications
Other Operated Depts & Rentals
Administrative & General
8.8%
$3,140
$13.56
8.9%
$3,472
$14.12
9.7%
$3,156
$13.58
9.2%
$3,247
Marketing
6.3%
$2,237
$9.66
6.8%
$2,640
$10.73
6.1%
$2,001
$8.61
6.1%
$2,171
$8.44
Utility Costs
4.3%
$1,549
$6.69
4.0%
$1,556
$6.33
5.0%
$1,613
$6.94
4.3%
$1,515
$5.88
4.6%
$1,626
$7.02
4.8%
$1,852
$7.53
5.3%
$1,722
$7.41
5.0%
$1,753
$6.81
Total Undistributed Expenses
Property Operations & Maintenance
24.0%
$8,553
$36.92
24.5%
$9,520
$38.71
26.1%
$8,493
$36.56
24.6%
$8,685
$33.74
Gross Operating Profit
36.9%
$13,154
$56.78
40.8%
$15,880
$64.57
37.2%
$12,127
$52.20
43.1%
$15,233
$59.18
Franchise Fees (Royalty)
2.3%
$813
$3.51
1.4%
$561
$2.28
2.2%
$712
$3.07
2.4%
$850
$3.30
Management Fees
2.8%
$1,005
$4.34
2.7%
$1,048
$4.26
2.9%
$959
$4.13
3.4%
$1,200
$4.66
31.8%
$11,337
$48.94
36.7%
$14,272
$58.03
32.1%
$10,456
$45.00
37.3%
$13,183
$51.21
Property Taxes
3.5%
$1,234
$5.33
3.5%
$1,362
$5.54
3.0%
$964
$4.15
3.7%
$1,321
$5.13
Insurance
1.0%
$370
$1.60
1.2%
$451
$1.83
1.2%
$402
$1.73
0.9%
$325
$1.26
Reserve for Replacement
2.3%
$814
$3.51
1.6%
$630
$2.56
1.3%
$431
$1.86
1.8%
$653
$2.54
6.8%
$2,418
$10.44
6.3%
$2,443
$9.93
5.5%
$1,797
$7.73
6.5%
$2,299
$8.93
25.0%
$8,919
$38.50
30.4%
$11,829
$48.09
26.6%
$8,659
$37.27
30.8%
$10,884
$42.28
Income Before Fixed Charges
Selected Fixed Expenses
Total Fixed Expenses
Amount Available for Debt Service & Other Fixed Charges (2)
(1)
(2)
Ratio to Sales for departmental expenses are based on their respective departmental revenues. All other expense ratios are based on total revenue.
Other Fixed Charges include Depreciation and Amortization, Interest, Rent, and Equipment Leases.
Custom HOST Reporting Properties
Location
Holiday Inn Lubbock Hotel & Towers
Lubbock, TX
Size
293
Hilton College Station & Conference C
College Station, TX
303
Hilton Waco
Waco, TX
195
DoubleTree El Paso Downtown City Center
El Paso, TX
200
Overton Hotel & Conference Ctr
Lubbock, TX
303
Source: STR
93
POTENTIAL CONVENTIONS
The tables illustrated below list the potential conventions that the ACVB would reportedly compete for should the
Proposed Hotel be developed.
Company
2-1 Calvary Assn
American Legion
American Socity of Civic Engineers
Assemblies of God
Association of Mayors, Councilmembers
Autism
Church of God of Prophecy
Combined Law Enforcement Association of Texas
County and District Clerks Assn
County Judges and Commissioners Association of Texas
CPA's
Daughers of the Republic of Texas
Delta Kappa Gamma
Disabled American Veterans Association
Evangelical Lutheran
Future Business Leaders of America
Grand Chapter, Texas Order of Eastern Star
Hostage Negotiators
International Order of Rainbow Girls
Joint Conference on Aging
Justice of the Peace Assn
Keep America Beautiful
Keep Texas Beautiful
Kiwanis
Knights of Columbus
Land & Title Assn.
Licensed Childcare
NAPUS
National Association of Retired Federal Employees/ Texas Chapter
National Association of Social Workers of Texas
Oddfellows
Pecan Growers
Pest Control Assn.
Professional Surveyors
Professional Surveyors
Rehab Action Network
Rotary International
Rural Rental Housing Association of Texas
Sheriff's Assn
South Central Poise Users Group
Southwest Association of College & University Housing Officers
Student Professional Services
Texas Ag Science
Texas Amateur Athletic Federation
Texas Aquarium & Zoo Educators
Texas Association for School Nutrition
Texas Association of Addiction Professionals
Texas Association of Assessing Officers
Texas Association of Gideons International
Texas Association of Master Gardeners
Texas Association of Mexican American Chambers
Texas Association of Museums
Texas Association of Sports Officials
Texas Association of Student Financial Aid Administrators
Texas Association of Vocational Nurse Educators
Texas Chapter American Planning Association
Texas Chapter of the Wildlife Society
Texas Chapter Public Risk Management Association
Texas Christian Business
Texas City Management Assn.
Frequency/Notes
Annual
Annual
Annual
Annual
Annual
Annual
Annual
Fall State Conference
Annual
Annual
Annual
Annual
Annual
Annual June State Convention
Annual
Annual Convention
State Conference
Annual
Adult Leadership Conf
Annual
Annual
Annual
State Conference
Annual
State Convention
Annual
Annual
Annual
State Convention
Annual Convention
Annual
Annual
Annual
Spring
Annual
Annual
Annual
Annual Summer Convention
Annual
Annual Meeting
Resident Assistant Conference
Annual
Annual
Annual
Annual Meeting
Annual Conference
State Conference
Annual Conference - TOO LARGE
Annual Conference
Annual
Annual
Annual April State Meeting & Trustees Conference
Softball Officials State Meeting
Basketball State Conference
Baseball Officials State Meeting
Annual Convention
Spring Convention and Workshop
October State Convention
Annual Meeting
Annual Conference
Annual
Annual
Attendance
300
1,000
1,200
250
500
1,200
800
300
400
700
500
450
1,200
400
420
1,200
500
350
500
1,200
500
400
400
1,400
1,200
400
500
300
430
337
350
650
250
300
300
350
770
250
1,200
300
300
300
3,300
250
350
2,000
800
1,100
400
750
400
550
400
675
175
350
230
400
350
225
390
900
Room Nights
525
850
1,700
750
750
1,010
400
410
1,770
900
300
465
1,100
1,000
600
1,000
60
600
204
1,035
845
600
450
1,100
1,400
600
255
495
800
128
425
300
400
160
160
350
560
436
1,300
450
140
325
1,500
475
685
2,088
168
782
357
1,000
900
525
86
366
186
183
112
426
204
81
200
1,300
Company
Texas Consumer Finance
Texas County Treasurers
Texas Court Reporters Association
Texas Crime Prevention Association
Texas Department of Public Safety Officers
Texas District and County Attorney's Assn
Texas Downtown Association
Texas Economic Development Council, Inc.
Texas Educational Support Staff Assn
Texas Electric Co-op
Texas Elks State Association
Texas Elks State Association
Texas Federation of Square and Round Dancers
Texas Foreign Language Assn
Texas Game Wardens
Texas Ground Water Assn
Texas Hospice Assn
Texas Housing Association
Texas Independent Producers & Royalty Owners
Texas Intercollegiate Press
Texas Irrigation Association
Texas Justice Court
Texas Letter Carriers
Texas Motor Transportation Association
Texas Narcotics Officers Association
Texas Narcotics Officers Association
Texas National Guard
Texas Nursery and Landscape Assn
Texas Nurses Association
Texas Nursing Students
Texas Occupational Therapy Association
Texas Parks and Wildlife
Texas Pest Control Association
Texas Physical Therapy Association
Texas Police Association
Texas Police Chiefs Association
Texas Pork Producers
Texas Probation Assn
Texas Public Health Association
Texas Retired Teachers Association
Texas Rural Health
Texas Rural Water Asssociation
Texas Section of American Water Works
Texas Sexual Assault
Texas Sign Assn
Texas Skills VICA
Texas Society of Certified Public Accountants
Texas Society of Professional Engineers
Texas Speech Language Hearing
Texas State Association of Firefighters
Texas State Foster Parents, Inc.
Texas State Historical Association
Texas Tactical Peace Officers Association
Texas Tennis Coaches
Texas Water Conservation Assn
Texas Water Utilities Association
Texas Wildlife Assn
Texas Young Farmers Assn
TOPS
VFW
West Texas Judges & Commissioners
Total
Frequency/Notes
Annual
Annual
Annual Convention
State Convention
State Conference
Annual
Annual
State Conference
Annual
Conference
Annual Fall Conference
State Convention
State
Annual
Annual
Annual
State
Annual
Annual
Annual
Conference
Annual
Annual
Southwest Movers
West Texas
State Conference
Annual
Annual
Annual
Annual
Annual Conference
Annual
Annual Convention
Annual Conference & Student Conclave
Police State Convention
Mid-year Conference
Annual
Annual
State Convention
Annual Conference
Annual
Annual Meeting
Annual
Annual
Annual
Annual
State Conference
Annual Convention
Annual
Biennial Convention
Annual Conference
Spring Education Meeting
State Meeting
Annual
Annual
Annual Conference
Annual
Annual
Annual
Annual
Annual
Attendance
300
270
350
300
300
300
250
350
500
360
500
670
2,000
500
400
300
350
450
320
450
400
200
950
225
350
550
850
1,000
450
300
255
350
500
200
300
150
200
500
300
1,044
250
200
620
300
370
350
500
250
2,300
275
725
600
300
500
450
1,500
700
400
1,950
400
450
70,236
Room Nights
250
400
325
425
426
460
250
136
400
845
309
207
513
400
450
400
378
540
360
353
100
375
1,700
100
215
1,100
1,070
460
303
200
140
650
450
122
450
340
260
1,225
730
1,036
250
338
420
400
312
600
893
198
1,550
150
395
187
365
300
400
1,072
1,003
600
1,200
200
745
69,163
Source: ACVB
94

lodging supply and demand analysis

Transcription

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