What's Happening?
Candlewood Suites Galveston is offering an investment opportunity with a price reduction to $6,900,000. The 83-key, extended-stay hotel has undergone renovations and is positioned in Galveston, Texas, a strong leisure market. The hotel boasts a net operating income of $773,000 and a capitalization rate of 11.2%. Galveston is experiencing significant development, including the construction of the Margaritaville Resort and expansions at the Port of Galveston, which are expected to boost the local economy. The area attracts millions of visitors annually, enhancing demand for accommodations. The hotel's location near major demand generators adds to its investment appeal.
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Why It's Important?
The sale of Candlewood Suites Galveston represents a strategic investment opportunity in a growing market. The reduced price offers potential investors a chance to acquire a property below replacement cost, with significant upside potential. The hotel's extended-stay model typically offers higher profit margins and lower operational costs, making it an attractive asset. The ongoing development in Galveston, including major projects like the Margaritaville Resort, is expected to increase tourist and business traffic, further enhancing the hotel's value. Investors will benefit from a 10-year license agreement with InterContinental Hotels Group, providing access to a large customer base.
What's Next?
Potential investors are encouraged to explore the opportunity to acquire Candlewood Suites Galveston, considering the favorable market conditions and projected growth in the area. The new owner will likely focus on maximizing the hotel's revenue potential by leveraging its strategic location and extended-stay model. As Galveston continues to develop, the hotel may see increased occupancy rates and revenue per available room. Stakeholders, including local businesses and tourism entities, will be monitoring the impact of new developments on the area's economic growth and accommodation demand.
