El Paso Motel
This is a 98 room El Paso Texas limited service motel located on 100 feet of frontage to I-10 at the Executive Center Boulevard Exit. The pylon sign for the property is visible from the I-10 and both west bound and east bound exit ramps have blue highway department signs directing drivers to the property.
Property is adjacent to 300,000 square feet of office space and is one exit west of the University of Texas El Paso and hospitals.
This indoor corridor property has a lobby, a breakfast area, meeting rooms, laundry room, outdoor swimming pool and an indoor hot tub. An excellent complimentary wireless internet is offered to the guests. Originally built as a Howard Johnson in 1973, the two-story property is located on a 3-acre site. The lobby, meeting rooms and public areas have central HVAC and the rooms are serviced by individual HVAC units.
The property has 30 king rooms, 55 rooms with two full beds 7 mini-suite rooms and one 2 room honeymoon suite.
Generally, the property is generally in good condition with some deferred maintenance. The room furnishings are mostly dated and overall the property requires a light remodel. It is undermarketed and is not with a franchise.
On the plus side there is an excellent staff, the rooms are very clean, the property is selective about its guests minimizing potential undesirable incidents and room damage, the property expenses are very low for the property size and there have been improvements such as new equipment for pool and spa, a new 10 unit camera system and well maintained laundry machines. On the downside, because of its age, the property is experiencing plumbing issues the repair for which we are assessing, and the interior common areas and rooms are dated and shabby.
GENERAL DEAL TERMS
The property is under a master lease with an option to purchase either in 5 years or with a lease extension, in 10 years. We plan to exercise the option to purchase within 5 years using an SBA loan. We are seeking to raise $500,000 to cover the lease option payment, renovation funds, operating reserves, signage, takeover costs and incidental maintenance issues.
Currently the property average monthly revenue is $38,600 with expenses of around $30,000. The owner is charging $10,800 per month rental during a ramp-up period of 12 months after which rent will increase to $14,500.