Economy Hotel - Kansas City
Stabilized 70-Rm Hotel Offered Below Replacement Cost w/ In-Place Cash Flow in a Resilient Midwest
Marketing description
Asking Price: $2,500,000
Avison Young Hospitality Group, as the exclusive agent for the Seller, is pleased to present the Economy Hotel – Kansas City, Missouri, a 70-room property offered unencumbered by management and debt.
Originally purchased with 50 operational rooms and 20 out-of-order rooms, the owner invested in renovations to bring the additional 20 rooms online. The hotel now offers a total of 70 rooms.
This offering provides investors with the opportunity to acquire a stabilized, cash-flowing asset in a strong regional market. The property benefits from in-place income and operational upside, making it well-suited for both owner-operators and value-focused investors.
With construction costs at historic highs due to inflation in labor and materials, ground-up development of a comparable hotel would require significantly higher capital investment. In contrast, this hotel is being offered at a substantial discount to replacement cost, delivering immediate value and an attractive basis for a new owner.
Investment highlights
- In-Place Cash Flow: The hotel is currently operating with positive net operating income, providing immediate yield for a new owner.
- Attractive Basis: Offered at $35,714 per key, this asset trades at a substantial discount to replacement cost in today’s high-construction-cost environment.
- Efficient Scale: With 70 rooms, the hotel is well-suited for either hands-on ownership or third-party management.
- Additional Growth Opportunity: Originally purchased with 50 operational rooms and 20 out-of-order rooms, the owner invested in renovations to bring the additional 20 rooms online. The hotel now offers a total of 70 rooms.
- Market Strength: The Kansas City metro continues to benefit from diverse demand drivers including defense contracting, healthcare, and a rebounding regional travel base.
- Operational Upside: Potential exists for improved revenue management, minor cosmetic upgrades, and increased direct booking strategies to enhance NOI.
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