|
30
<br /> SECTION VII
<br />HOSPITALITY
<br />
<br />
<br />
<br />Related Bristol at 3600 South Bristol Street September 2023
<br />Draft Market Study Report
<br />
<br />www.FinanceDTA.com
<br />more than 15 floors and over 30,000 SF of meeting space.
<br />Table 12: Selected Hotels in the 2-Mile Zone
<br />Property Name No. of
<br />Stories Rooms Land
<br />Area (SF)
<br />Total
<br />Mtg
<br />Space
<br />No. of
<br />Parking
<br />Spaces
<br />Adv.
<br />Room
<br />Rent
<br />Hotel Class Star
<br />Rating Brand Year
<br />Built
<br />Year
<br />Renovated
<br />Hilton Orange County Costa Mesa 7 486 252,648 32,379 535 $194 Upper Upscale 4 Hilton 1970 2014
<br />Westin South Coast Plaza Costa Mesa 15 393 129,373 33,952 $244 Upper Upscale 4 Westin 1975 2008
<br />Avenue Of The Arts Costa Mesa 5 238 130,680 5,000 250 $234 Upper Upscale 4 Tribute Portfolio 1986 0
<br />Marriott Costa Mesa 11 253 131,155 3,072 $237 Upper Upscale 4 Marriott 1989 2004
<br />Marriott Irvine 17 496 465,656 26,645 600 $339 Upper Upscale 4 Marriott 1983 0
<br />Hilton Irvine Orange County Airport 10 306 288,803 18,036 414 $203 Upper Upscale 4 Hilton 1985 2016
<br />Embassy Suites by Hilton Irvine Orange County Airport 10 293 86,684 2,199 534 $155 Upper Upscale 4 Embassy Suites by
<br />Hilton 1986 2008
<br />Embassy Suites by Hilton Santa Ana Orange County Airport 7 301 164,156 7,251 350 $125 Upper Upscale 4 Embassy Suites by
<br />Hilton 1984 0
<br />Marriott Newport Beach Bayview 9 254 214,568 3,798 297 $279 Upper Upscale 4 Marriott 1988 2018
<br />Renaissance Newport Beach Hotel 10 444 322,344 16,815 450 $184 Upper Upscale 4 Renaissance 1983 0
<br />Hyatt Regency John Wayne Airport Newport Beach 7 343 267,894 21,000 219 $198 Upper Upscale 4 Hyatt Regency 1974 0
<br />Best Western Plus Newport Mesa Inn 3 97 56,628 3,000 $219 Upper Midscale 3 Best Western Plus 1984 0
<br />Hampton by Hilton Inn & Suites Irvine Orange County Airport 4 164 43,560 2,511 $177 Upper Midscale 3 Hampton by Hilton 2018 0
<br />Atrium Hotel Orange County 3 210 278,784 6,300 $169 Upper Midscale 3 1969 0
<br />Total Upscale Rooms is 2-Mile Zone 4,278
<br />Overall Average 570 3,649 $211
<br />Upper Upscale 346 $218
<br />Upper Midscale 157 $173
<br />As a result, we based our daily room rates on the data presented in Table 12. Although the advertised
<br />room rate for the Westin South Coast Plaza is $244 per night, we chose to use an average room rate of
<br />$210 for the proposed hotel. We believe that the Westin South Coast Plaza’s affiliation with the Hilton
<br />Flag drives significant guests to it and, since there are no comments in the Specific Plan that the hotel
<br />would be flagged, we adjusted the room rate downward. Further, since most Upper Upscale business
<br />hotels have established long-term relationships with corporate clients, we felt these long-term
<br />relationships would continue to direct corporate business to them. Until we obtain additional
<br />information, we have concluded that a daily room rate of $210 was representative of the future. We
<br />further believe that once the proposed hotel gains a reputation, its revenue could approach that of the
<br />Westin South Coast Plaza.
<br />The next step in determining total hotel revenue is to estimate the RevPAR revenues. These include food
<br />sales, beverage sales, technology revenues, and minor departments. The first two categories are self-
<br />explanatory. Technology revenues relate to internet, phone service, TV-streaming services, and others
<br />guest services. Minor department revenues include garage facilities, in-house laundry, health clubs and
<br />swimming pools, and retail shops. These departmental revenues make up more than 26% of total hotel
<br />revenues. We reduced department revenues by corresponding department expenses.
<br />In addition to department income and expenses, hotels incur “Undistributed Operating Expenses.” These
<br />expenses include administration and general operating, marketing, management fees, franchise fees,
<br />energy, operations and maintenance, insurance, and property taxes.
<br />Table 13: Hotel NAV
<br />Hotel Percentage Daily Room
<br />Rent
<br />Daily
<br />Revenue Annual Revenue % of Total
<br />Base Room Rent $210.00 $52,500 $19,162,500 104.66%
<br />Exhibit 10
<br />
<br />
<br />City Council 22 – 553 9/17/2024
|