Greg Meinhold of Pacific Hotel Motel Specialists in Everett, WA is listing the properties for Wen-fan. Why is Wen-fan selling? "He's ready to sell and move on to new ventures," Meinhold tells GlobeSt, adding that the price translates to $66,279/room, reflecting a combined cap rate of 8.08%.
The 47-room Econo Lodge franchise was built by Wen-fan in 1985. According to First American Title Co., Wen-fan purchased the 26,459-sf development site in 1979. At 13910 Pacific Highway S, the Econo Lodge lies about three miles north of the Seattle-Tacoma International Airport.
The Econo Lodge's 2000 occupancy was 43%, down from 54.2% in 1999. Meinhold says the drop in occupancy is due to Wen-fan's strategy of relocating many customers across the street to his higher-priced Ramada during its first year of operation. The Ramada Limited, located at 4006 S. 139th St. on a .54-acre site, opened in late 1998. The two properties share airport shuttle service and other guest service personnel such as housekeeping.
According to the hotel market report by Colliers International, 2000 was a relatively slow year, with the majority of transactions being for properties in the 60- to 120-room range. The report listed two 2000 transactions for SeaTac motel properties similar in size to those being offered by Wen-fan.
The first, a 58-room Howard Johnson (now the SeaTac Skyway) sold in May for $2,567,000, which translates to $44,259/room and a cap rate of 9.2%. That same month, the 57-room Sea Tac Inn captured $2,625,000, or $46,053/room. The cap rate was 11.4%.
Meinhold says disparities among the prices being netted by airport hotel properties are a reflection of differences in their amenities and general condition. Many SeaTac hotel and motel properties were built in the 60's in anticipation of the World's Fair, says Meinhold.
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
