Phoenix American Hospitality acquired the Doubletree by Hilton Airport in Charlotte, NC, and will take over management on January 1, 2019.
Property Description
Name: Hilton Doubletree
Location: Charlotte, NC
Acquisition Date: May 28, 2015
Acquisition Price: $16.2 million
Keys: 173
Purchase Cap Rate: 10.6%
Economics
Cap Ex: $3,500,000
NOI at Purchase: $1,717,200
Current NOI (T-12): $3,200,660
NOI: $1,483,460
Increased NOI: 85%
Commentary
Expense Reductions:
● Improved cleaning staff efficiency for a net savings of 12%
● Relocation of on-site accounting staff to central headquarters for a net savings of 22%
● Renegotiated franchise fees saving 9%
● Reduced reliance on sales concessions (free breakfast, movies, etc.), for a net savings of 14%
Revenue Improvement:
● Renegotiated existing contract group business resulting in the creation of an additional $311,000 in cash flow
● Increased RevPar* by implementing pricing strategies
● Results: Current value of $37.6 million (based on an 8 ½% cap rate)
*Revenue per available room