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The Active! Hotel Orlando

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Hector Soliman-Valdez

on 12 December 2013

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Transcript of The Active! Hotel Orlando

Fees (City of Orlando)
Building permit: $94,900
Sewer: $9,135
Demolition: $4,602
Engineering: $199,080
Fire: $850
Growth Management Plan: $3,000
Mechanical: $66,360
Right of Way: $120
Sidewalk Café: $500
Zoning Amendment: $2,500
Total $381,047 -- $9.74/sq. ft.
Construction costs per sq. ft = $6,636,000
Hotel = $4,834,800
28,440 sq. ft.(3 floors)
First floor (restaurant & retail) = $1,801,200
9,480 sq. ft.
Soft Costs = $1,401,068.16
20% construction costs
Land = $186,502.00
Infrastructure improvements (demolition): $10,444
Site acquisition: $176,058
Total Projected Development Costs
Orange County Property Appraiser: www.ocpafl.org
HOST 2012: U.S. Hotel Operating Statistics Study: http://www.old.li.suu.edu/library/circulation/Steed/2012HostReport.pdf
City of Orlando, Permitting Services: http://www.cityoforlando.net/permits/commercial.htm
Quarterly Census of Employment and Wages: http://www.floridajobs.org/labor-market-information/data-center/statistical-programs/quarterly-census-of-employment-and-wages
RS Means, Construction Data: http://www.reedconstructiondata.com/rsmeans/models/hotel/
Loopnet: www.loopnet.com
Visit Orlando, Hotel Statistics: http://corporate.visitorlando.com/research-and-statistics/orlando-hotel-statistics/monthly-hotel-occupancy-and-adr/
Demolition Costs, Chron: http://smallbusiness.chron.com/determine-building-demolition-costs-15447.html
HVS Design, Hotel Cost Estimating Guide 2012: http://reicmsu.weebly.com/uploads/2/0/7/0/20702360/hvs_hotelcostestimatingguide_copy.pdf
Market Analysis
The lodging industry is one of the most important industries in Orlando.
Over 55 Million people visited the Orlando Metro area last year.
Orlando receives the most visitors in the country. Only Vegas and New York City come close in the number of visitors.
Majority of these visitors stay at a hotel during their time in Orlando.
There are 453 hotels in the Greater Orlando Area, with a total of 116,499 hotel rooms.
Of these only 12 hotels are located in Downtown Orlando.
Current occupancy rate in Orlando is showing an upward trend increasing to an average occupancy of 74.3 percent from 72.8 percent the previous year.
The average revenue per room is up as well increasing to $79.38 per room from $74.81 in 2012
Front Door Analysis
Site acquisition
Land infrastructure improvements
Construction costs
Size of building
Hard Costs
Soft costs
Occupancy rate
Operating expenses
Debt coverage
Needed return
The Active! Hotel Orlando
Distinguishing Characteristics
Target Market
Taking advantage of all of the sports and entertainment venues in downtown Orlando.
The new soccer stadium will greatly boost the number of sports visitors Downtown Orlando
Average expected game attendance is 18,611
Amway Arena is home to several sports teams, as well as concerts
The Magic have an average game attendance of 13,455
The Orlando Polar Bears have an average game attendance of 6,645
The Amway also has a concert seating capacity of 17,030
The Orange Bowl has a seating capacity 64,443 and holds several events a year.
Other Variables
Within ten minute walk to new soccer stadium and Citrus Bowl
Accessible to other points of interest by LYNX bus
Located in Orange Blossom Trail CRA
Site Conditions

On high traffic intersection of Washington & OBT (average daily traffic of 30,793)
39,125 sq. ft. (.9 ac.)
Currently zoned MU-1
FAR .5
3 existing structures
Existing paved parking lot, 12,542 sq. ft. (about 70 spaces)
Market value: $176,058
The Active! Hotel Orlando will be a 60 room hotel catering to the young, active
Orlando is currently lacking a hotel that targets the growing number of sports fans visiting Orlando, specifically Downtown Orlando
There will soon be an explosion of sports fans in Downtown Orlando due to the new Soccer stadium that is being built.
37,920 sq. ft.

Grand Total: $8,592,910.26

Operating Expenses
Fixed: property taxes, management, marketing, insurance
Variable: maintenance, repair, utilities, food & beverage, labor
Industry standard is about 47% of revenue is allocated toward operating expenses
Occupancy Rate
2012 Orange County Hotels: 70%
2012 Central Orlando Hotels: 74%
Assuming: 70%, when including restaurant and retailer on bottom floor
LTV 80%
20 years, 6.75%
Debt coverage ratio: 1.25
Needed return: .15
Request City to rezone property from MU-1 to MU-2
This will allow for more intensity, including an 1.0 FAR
Rezoning process charges accounted for in "fees"
Allowable uses include group housing, eating/drinking, hotels/motels, intensive/light retail, entertainment/business services, office, parking, indoor recreation, and more
Using this property as a hotel will act as a catalyst for redevelopment in the area
Back Door Analysis
Modified Back Door Analysis

Second Modified Back Door Analysis

Hotel Concept
Target Market Cont.
The Dr. Phillips Performing Arts Center when constructed will also be within close distance to the hotel. When completed the Arts center will have a seating capacity of 4,700 people.
Downtown Orlando is the location of many of the cities nightclubs and bars. It in essence is an "Entertainment District"
Bringing more development to the OBT CRA
Expanding CRA tax base
Acting as catalyst for redevelopment along OBT corridor
Filling market need for a hotel of this type in this location
Fiscal Benefit: Hotel creates .5-2 jobs per room
With 60 rooms and full-service facility, about 100 jobs will be created
Economic Benefit: About $1,600,000 in annual wages (According to 2012 ES-202 for Orange County)
Benefit Analysis
4 floors
52' tall structure
60 rooms, 450 sq. ft. each,
Bottom floor will have 1,000 sq. ft. lobby, 4,500 sq. ft. restaurant and 3,500 sq. ft. retail space
Full-service hotel
Provide food & beverage room service
Lobby area with meeting space
Rooftop pool
Raises operating costs
Competitor Hotels
1. Grand Bohemian
Current rate: $149-209
212 rooms
15 floors
Parking fee $25 (garage)
2. Embassy Suites Orlando
Current rate: $159-179
167 rooms
7 floors
Surface parking, no fee
3. Sheraton Orlando
Current rate: $109-149
14 floors
290 rooms
Surface parking, no fee
4. EO Inn & Spa
17 rooms
Current rate: $79-109
Surface parking, no fee
Used rents from Front Door Analysis
Occupancy Rate is factored into rentable sq. ft.
Projected Development Costs excludes land
All other factors held constant (Operating Expenses, Occupancy Rate, Loan Factors, etc.)
Becomes "high rent" example
Lowered both rents
All other factors held constant from Back Door 1
Ending supportable site costs still high
Becomes "mid-high" rent example
Lowered both rents
Decreased operating costs from 47% to 40%
Becomes "mid-low" rent example
Most feasible rents given comparables
The Active! is fulfilling an unmet need which is a youth and sports centered hotel.
It is catering to this group by being in
close proximity to all of the areas
major sports facilities as well as to
the Downtown Entertainment
Its restaurant/bar on its first level
and its rooftop pool lend to its attractiveness to this clientele
Located along Lynx bus route.
Because sports are played year round in Orlando, the hotels main clientele base will visiting year round.
1st floor:
9,480 sq. ft.
28,440 sq. ft.

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