Okay, who wants to go to Parkersburg? There are two hotels on the market here . . .
Property offering
Listing broker: Laurel Hotel Brokers, via LoopNetTripAdvisor reviews: Bubble score 4.0
Property website:
Comfort Inn, Parkersburg (Choice Hotels child site)| Asking price | $3,650,000.00 | Given |
| Number of rooms | 76 | Given |
| Annual gross | $1,149,910.00 | Given, but confirm |
| Occupancy | 48.10% | Given |
| ADR | $82.70 | Not given |
| REVPAR | $41.45 | Calculated |
| Room revenue multiplier | 3.15 | Not given |
| Year built | 1995 | Given |
The facility:
This is a 21-year old property. The original design was a bit '80's dated, even when it was built, but didn't look all that bad, and more recent exterior renovations have not been an improvement.(Perhaps it's a personal taste matter, but I hate Tammy Faye EFIS exteriors. Who are you trying to kid with the apparent age of that property? After you apply that much EFIS, or stucco, or makeup . . . did the hotel, or even Tammy Faye, look that bad before?)
Original exterior
Present appearance, after a coat of Tammy Faye stucco . . .
The patron saint of bad hotel exterior renovation, rest her soul. (I never hated Tammy Faye or really held her past association with Jim Bakker and The PTL Club scandal back in the 1980's against her, I just think her 'extremism is no vice in the war against aging' approach to the application of cheap cosmetics was a bit extreme, and has since been a bad influence on hotel renovation architecture . . .)
The location:
Those properties out on the interstate are going to be much more I-77 dependent and may drag your rates down a bit, but the Parkersburg area is not that isolated, and Wood County has more outlying demand generators.
Any property located in the town itself is going to be more dependent on pro-active sales and marketing. This can offer great success -- the Hampton Inn and the historic Blennerhasset Hotel are both located in this submarket -- but it's going to take a little more work.
This is particularly true for this property, because visibility from a traffic artery is going to be a problem.
The market:
Parkersburg is the third largest city in West Virginia.
The area economy is driven by education and finance. The Bureau of the Fiscal Service, United States Department of the Treasury, is located here; and Highmark Blue Cross has significant operations. Ohio Valley University's campus is on the city's northern border, and the campus of West Virginia University is located on the other side of I-77.
Camden Clark Medical Center is a regional hospital located downtown, three miles from the property. It has recently completed an expansion.
The area economy is driven by education and finance. The Bureau of the Fiscal Service, United States Department of the Treasury, is located here; and Highmark Blue Cross has significant operations. Ohio Valley University's campus is on the city's northern border, and the campus of West Virginia University is located on the other side of I-77.
Camden Clark Medical Center is a regional hospital located downtown, three miles from the property. It has recently completed an expansion.
Market information links:
City of Parkersburg -- Official website
Parkersburg, W. Va. -- Wikipedia entry
The physical location (area, surrounding neighborhood):
This property is located in Parkersburg's uptown retail area, within walking distance (a half mile, if you don't mind walking) of a respectably-sized regional mall with the grandiose name of Grand Central Mall. It's within walking distance to several restaurants, something that is lacking by comparison for its main competitor, the Wingate by Wyndham in Vienna.
It is one of two Class A properties proximate to Ohio Valley University. A smart operator would take care to cultivate a close relationship with OVU and its secondary demand generators, and use the hotel's convenient location to its advantage.
One disadvantage that it has is that it's located a bit back off Route 14/Murdoch Avenue, the traffic artery that runs in front of it, and visibility is a challenge that must be managed.
Facility changes recommended:
The property appears to be in pretty good shape. Most of the renovations we'd do here would related to conversion of the property to the Red Lion brand and bringing it into line with their standards, should we convert the property to a Red Lion Inn and Suites.Added care should be given to ventilation, and the PTAC units in the rooms need to be checked: several people note this to be a problem. Some minor mold remediation may be in order. Any non-working or noisy exhaust fan in a bathroom needs to be replaced.
If the mattresses are more than a year old, you need new mattresses -- that's how long now TripAdvisor hits on the mattresses have been showing up.
Security needs attention: loitering in the parking lot, even by comparatively harmless but noisy drunks, doesn't work.
Several TripAdvisor reviews alluded to slow wi-fi speeds, but that could be an Ethostream problem (Ethostream is Choice Hotels' required -- but often poor quality -- internet provider in its franchised hotels; and if we reflag the hotel, we'd be replacing it with something that actually works, anyway.)
Operational changes recommended:
Both facility design and management, as Beechmont would approach it in this location, will reflect the need to maintain this property as a Class A mid-market property.Some TripAdvisor reviews of this property indicate a need to tighten up housekeeping and room inventory control. Housekeeping should be tightened up anywhere, but possible excuses for a guest to be checked into a dirty room are rare, if the housekeeping and front office staff are working together as they should be.
Marketing recommendations:
I generally don't recommend a full time director of sales and marketing for a property this small, but in this location it might be listenable. You're not going to shag a lot of traffic off I-77 with it without some severely discounted Exit Information Guide coupons, and visibility is a problem if you are in that part of town. Nonetheless, it has the best raw location of any hotel in the Parkersburg area -- but if you want the business, you're going to have to go out and get it.For now, marketing at this property needs a fresh look, and it shows in its current performance. The average daily rate claimed by the broker is $82.70, the rack rate according to the Choice Hotels website is $139.00. I know they're coming off a bad year, with two new hotels opening in the area within each of the last two years, and they seem to be recovering a bit, but we've been seeing too many $67 rates on TripAdvisor and its online travel agency affiliates recently.
Franchise options:
IF WE EXECUTE A HOTEL MANAGEMENT AGREEMENT WITH AN EVENTUAL BUYER, THAT AGREEMENT WILL PROVIDE THAT WE HAVE ACCESS TO ALL BUSINESS RECORDS OF THE PROPERTY PRIOR TO CLOSING. IF THESE INDICATE THAT THE FRANCHISE NOW IN PLACE IS WORKING AND IS BENEFITING THE PROPERTY, WE GENERALLY ADVISE KEEPING IT, SUBJECT TO FIVE-YEAR TERMINATION OPTIONS.
Nonetheless, we're pretty clear that the Comfort Inn brand is not working at this property. Choice Hotels' franchises are oversold here, as they are in so many places: they now have more hotels in Parkersburg than they are able to support -- but hey, whatever keeps the fees and royalties rolling in for them. That new Sleep Inn out in the I-77 corridor that opened two years ago did not help, and a Comfort Suites in Mineral Wells draws a lot of Choice-generated traffic. The cumulative effect is that all three of these properties are not well-served by Choice, and their rates lag competitively, and they underperform.
We recommend conversion of this property to a Red Lion Inn and Suites. As a Class A mid-market brand, Red Lion is gaining in competitive strength, while Comfort Inn has been in decline for more than ten years now. Red Lion also has a historic willingness (and in the eastern United States, a present, pressing need) to accept an older property as a franchisee and -- assuming you renovate and keep it up in accordance with their standards -- make it possible for that property to compete against any Class A property with a first-tier franchise.
Red Lion isn't going to hand success to you on a plate, but Choice Hotels clearly isn't; and unlike Red Lion, Choice has proven it already. If you want success that comes in a 'kit' you can buy, sign up as an Amway distributor. It's only going to happen for you at this location in Parkersburg only if you have strong local marketing -- but we anticipate and assume that with any hotel franchise, even first-tier franchises like Marriott, Hilton and IHG.
We have no affiliation with Red Lion. (Over the last year, some people have started to wonder if Beechmont is getting to be the Red Lion guys, because recently we've come to recommend them frequently). What we like about Red Lion is that you can build a brand new one and stand it up against any Hampton Inn or Holiday Inn Express -- or take an older property such as this one, renovate it to pristine condition, and re-flag it as a Red Lion, and it would fit right in without having it make your new property look bad. The "older" look fits right in with the quirkiness.
If you want to build a brand new hotel, Red Lion will justify your investment; if you can't spend more than five million, pick up a property like this, convert it to their standards, and you're still in the
game.
Offer $3mil and see what they do. Be prepared to go as high as $3.2mil, but only if they agree to deliver unencumbered by franchise and unencumbered by management.
Food and beverage should be limited to the required continental breakfast, and a catering kitchen capable of supporting the events.
If you want to build a brand new hotel, Red Lion will justify your investment; if you can't spend more than five million, pick up a property like this, convert it to their standards, and you're still in the
game.
Our recommendation:
I see little about this property that makes it worth more than three times its gross room revenue: its location is compensated by its lack of visibility, its next to worthless Choice Hotels affiliation, and its aging appearance (which its visit a couple of years ago by the ghost of Tammy Faye amplified, rather than rectified). Its location -- once offset by its flaws and failings -- is good for a premium of, at most, 3.1xGRR if you pay it a visit and find no further problems, and it's been sitting on the market for several months.Offer $3mil and see what they do. Be prepared to go as high as $3.2mil, but only if they agree to deliver unencumbered by franchise and unencumbered by management.
Food and beverage should be limited to the required continental breakfast, and a catering kitchen capable of supporting the events.
Evaluation:
| Value of property based on data given: | High | $3,200,000 |
| (Our estimate) | Low | $3,000,000 |
| Renovation required | Flag change | |
| Recommended budget | $250,000.00 | $750,000.00 |
Who should buy this hotel?
Someone who had some skill and experience doing corporate and group marketing, but not a large, policy-bound corporate owner.
You'll want a sharp, aggressive, think-outside-the-box salesperson, even if it's someone that only works part time. The only thing trying to manage it by committee is going to do for this property is add to the overhead, and have the various members of your "management team" getting in each other's way.
If you currently own or operate a hotel in Nashville, Montgomery, Ala.; Searcy, Ark., Abilene or Lubbock, Texas; Camp Hill, or Harrisburg, Pa.; Covington, Ky.; Wilkes-Barre-Scranton, Pa.; or the Minneapolis or Phoenix area; you should consider a Parkersburg property, especially if one of more of your current properties is getting corporate or group business from one of the companies previously mentioned.
The location is excellent, visibility is dicey -- and even so, it racks at $139. But you'll never get the full potential out of this property -- and in a bad year, be lucky to get half that much as a room rate -- if you don't know how to do marketing, or get someone in there who can. You can stubbornly hang on to that $139 rack rate, but your marketing is going to continue to be way too discount-dependent
If you currently own or operate a hotel in Nashville, Montgomery, Ala.; Searcy, Ark., Abilene or Lubbock, Texas; Camp Hill, or Harrisburg, Pa.; Covington, Ky.; Wilkes-Barre-Scranton, Pa.; or the Minneapolis or Phoenix area; you should consider a Parkersburg property, especially if one of more of your current properties is getting corporate or group business from one of the companies previously mentioned.
Who should not buy this hotel?
Without the marketing skill and the ability to reach out to corporate and group customers, this property is going to continue to perform below its potential.The location is excellent, visibility is dicey -- and even so, it racks at $139. But you'll never get the full potential out of this property -- and in a bad year, be lucky to get half that much as a room rate -- if you don't know how to do marketing, or get someone in there who can. You can stubbornly hang on to that $139 rack rate, but your marketing is going to continue to be way too discount-dependent
Beechmont links
About us
Beechmont Hotels Corporation is a hotel management company based in Winston-Salem, N. C. We frequently have occasion to perform asset identification services for potential clients who are seeking to acquire hotels, and inform them as to how a particular hotel listed for sale can best serve their investment needs -- or not.
After a time, we will republish the information here as a short feasibility study (unless an agreement with the potential client for whom we originally examined the property prohibits it).
Our evaluation is based on our own subjective opinion, using data collected from freely available sources online, unless otherwise noted in the Disclosures above. Our advice as shown here is as we would advise a client. You are free to accept or reject it, and should check behind us and make your own evaluation.
Ultimately, you are responsible for your own decisions, including whether to rely upon our opinion or to confirm our assessment for yourself, and we assume nor accept any liability.
When we choose -- ourselves -- a hotel offering to evaluate here, we choose only hotels that we have something nice to say about, a positive recommendation to make; hotels that we wouldn't mind signing to manage ourselves for twenty years.
When someone submits one to us, we're totally candid and spare no one's interests or feelings. If it's a bum deal, we'll simply tell you, don't touch it with a ten foot pole, and we don't care who gets mad.
If you are contemplating purchase of a hotel, or if you are a hotel broker, and would like for us to complete an evaluation similar to this for you for the hotel that you are considering, send a PayPal for $100 at makeitrain18018@gmail.com .
(It has to be a hotel that is currently listed for sale, that you can look up on Loopnet or a broker website. I will pass the information to you privately, and wait a few weeks before I republish it here, unless we make other arrangements in advance -- at a slight extra charge -- to keep it just between us.)
Click here for a listing of other hotels for sale and available that we've reviewed.
When someone submits one to us, we're totally candid and spare no one's interests or feelings. If it's a bum deal, we'll simply tell you, don't touch it with a ten foot pole, and we don't care who gets mad.
Click here for a listing of other hotels for sale and available that we've reviewed.
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