Marcus and Millichap is proud to present a rare investment opportunity, the Best Western Executive Inn and Suites in Colorado Springs. This hotel offers the opportunity to own a turnkey property in an excellent location, which promises to produce a strong return on investment.




The current property owner adjusts the room rate three times a year based on peak and off-peak seasons, a revenue management model that has resulted in underperformance of the property. This hotel has the highest average daily rate and lowest occupancy among its competitive set. Competing properties use a dynamic revenue management model and make rate adjustments daily, and in some cases several times a day, to match demand.

The higher revenue that a new owner can expect is reflected in the STAR report and in a recent rate and occupancy survey for the first week of July 2008. In this rate survey, the Best Western Executive Inn and Suites maintained the same rate throughout the week without regard to demand, while each of its competitors adjusted the rate based on room demand.

Had the Best Western operator used a dynamic revenue management model adjusting the rate based on room demandthe property would have captured its market share.

The STAR reported, included in the offering memorandum, confirms the survey data. The numbers presented in the offering are based on applying an effective revenue management model, but all other things remain the same.

Any operator considering the purchase of a hotel in Colorado Springs will implement a revenue model that adjusts the rate based on existing room demand. An abundance of information shows that an effective revenue model will bolster future performance and an investor can reliably estimate future income.

Achieving higher revenue requires no additional effort or investment by the new owner; a similar model would be implemented with any property owned. However, in this case, a savvy buyer can take advantage of this opportunity and achieve a stronger equity position in a short time.



If the current operator had implemented an effective rate management model or begins to implement this model and sells the property in 2009, it would be expected to trade near $5,200,000 (3.82 X $1,380,926/pro-forma). It would trade at a cap rate of 11.07%, well above previous sales.

Alternatively, a buyer has the opportunity to purchase this property for $4,500,000, which is significantly below the market value. In fact, a purchase at $4,500,000 has an effective RRM of 3.26, which is below all of the comparable sales depicted above.

This rare opportunity will attract the interest of many seasoned hotel investors. Please contact me to recieve a copy of the full offering memorandum. If it meets your investment strategy, please present a letter of intent at your earliest convenience. Thank you for taking time to consider this exceptional offering.

Phil A. McDonald
National Hospitality Group
Marcus and Millichap