• Best Western Plus Lake Jackson Inn & Suites   

HVS, as the sole and exclusive advisory firm to ownership, present thes opportunity to acquire the 64-key Best Western Plus Lake Jackson Inn & Suites, a limited-service hotel asset in Lake Jackson, Texas. Lake Jackson is situated approximately 55 miles south of Houston, and its economy is anchored by the petrochemical industry. A more “hands-on” owner/operator will have the opportunity to acquire a limited-service hotel in excellent physical condition with upside to restructure the hotel’s operations by reducing expenses and improving NOI flow-through.

Ideal Opportunity for an Experienced Owner/Operator

  • The 64-key count is considered an ideal size for an experienced owner/operator.

Operational Upside for a New Operator to Improve NOI Flow-Through

  • Based on the year-end 2022 financial statement, the hotel achieved a gross operating profit (GOP) of 17.9%, with an NOI flow-through of less than $75,000. 

  • Looking at comparable operating statements of similar assets, the average GOP was 45.0% to 50.0%. Thus, this represents an ideal opportunity for a more aggressive operator to improve operations and increase NOI flow-through.

  • Per the October 2023 STR Report, the hotel ranked fourth out of six competitive hotels in terms of occupancy and third out of six in terms of ADR. As the newest hotel in its competitive set, a more prudent and “hands-on” operator should be able to capture more transient demand and transition the hotel into a market leader.

Well-Maintained, High-Quality Physical Product 

  • The hotel opened in 2015, and ownership has maintained the property exceptionally well by implementing a monthly inspection of all guestrooms. 

  • Given the property's very good physical condition, a minimal change-of-ownership PIP is expected. 

  • Since opening, the hotel has consistently achieved Best Western’s M.K. Guertin award, an annual recognition of the top fifty Best Western-branded hotels with exemplary performance in quality, guest satisfaction, and brand compliance.

  • Per Best Western’s latest quality assurance report, the hotel scored an “Outstanding” overall rating of 971 out of 1,000.

Discount to Replacement Cost

  • Based on current pricing guidance, the property is priced below replacement cost at $83,000 per key. 

  • To construct a similar limited-service hotel asset with comparable amenities, the estimated all-in investment would be a minimum of $120,000 per key.

Best Western Franchise

  • Per Best Western, the brand boasts the most competitive franchise fees, allowing owners to drive more revenue to the bottom line. 

  • New franchisees will benefit from the automatic franchise transfer agreement to operate the hotel.

Excellent Location Among Strong Corporate & Leisure Demand Generators

  • The property benefits from an excellent location near strong corporate demand generators, including Dow Chemical's Lake Jackson campus and Shintech's Freeport facility.

  • A large commercial zone on the opposite side of Texas Highway 288/332 is also home to many prominent petrochemical-related corporate demand generators, including Dow Chemical’s company plant, BASF Chemicals, and SK Primacor Americas.

  • Other impactful corporate demand generators in the market include Wood Group, Phillips 66, Freeport LNG, Fluor, Jacobs Engineering, Chevron Phillips Chemical Co., and Schlumberger.

  • For leisure travelers, the property is conveniently located near popular attractions such as the Sea Center Texas Aquarium, Brazos Mall, Lake Jackson Recreation Center, Lake Jackson Historical Museum, Urban Air Trampoline, and Gulf Coast Bird Observatory, as well as the beaches along the Gulf Coast.

  • The property is located roughly ten miles from Texas Gulf Coast Regional Airport and just an hour's drive from Houston and Galveston, convenient for both business and leisure travelers.

Expanding Petrochemical Market 

  • Per the Economic Development Alliance for Brazoria County, plant expansions underway represent approximately $3.9 billion of capital investment. 

    • ​​​​​​​Freeport LNG - Natural Gas Liquefaction Train 4 ($2.4 billion)

    • Ascend Performance Materials Texas Inc. - Technology Modernization ($130 million)

    • Maxter Healthcare Phases 1 & 2 - Medical/Surgical Glove Manufacturer ($340 million)

    • Maxter Healthcare Phases 3 & 4 - Medical/Surgical Glove Manufacturer ($200 million)

    • Volkswagen - Vehicle Import and Processing ($115 million)

    • The Dow Chemical Co. Freeport - Polyethylene Plant ($715 million)

  • With the peak of construction estimated to bring thousands of temporary workers over the next few years, the hotel is well positioned to take advantage of the economic growth and expansion, including the associated increase in lodging demand, during that time.

Management Availability

  • The hotel asset is being offered free and clear of any management encumbrances, providing an investor with the flexibility to revamp the operational strategies of the current operator.

 

For inquiries please visit here to execute the Confidentiality Agreement.