Sheraton Hotel Redding At Sundial Bridge - Redding Record ...

Competitive Position
calculated by dividing the total rooms revenue achieved during a specified period
by the number of rooms sold during the same period. The projected average rate
and the anticipated occupancy percentage are used to forecast rooms revenue,
which in turn provides the basis for estimating most other income and expense
categories.
Although the average rate analysis presented here follows the occupancy
projection, these two statistics are highly correlated; in reality, one cannot project
occupancy without making specific assumptions regarding average rate. This
relationship is best illustrated by revenue per available room (RevPAR), which
reflects a property's ability to maximize rooms revenue.
At this time, the subject property is expected to be the newest hotel in the market
and proximate to one of the major leisure demand generators in Redding. The
property will offer upscale rooms. It is our opinion that the average rate, if the
hotel were operating as a stabilized property in 2010, would be moderately above
the rates of the Hilton Garden Inn and Hampton Inn and Suites. The base-year
(2010) average rate for the subject property as if open and stabilized has been
estimated at $121.78. The following table summarizes the historical 2010 average
rate and the RevPAR of the subject property’s future competitors.
FIGURE 7-5 BASE-YEAR AVERAGE RATE AND REVPAR OF THE COMPETITORS
Property
Estimated 2010
Average Room
Rate
Average
Room Rate
Penetration
Rooms Revenue
Per Available
Room (RevPAR)
RevPAR
Penetration
Hilton Garden Inn Redding $112.00 115.0 % $90.72 143.5 %
Hampton Inn & Suites Redding 112.00 115.0 90.72 143.5
Holiday Inn Redding 103.00 105.7 64.89 102.6
Best Western Twin View Inn & Suites 76.00 78.0 43.32 68.5
La Quinta Redding 92.00 94.4 55.20 87.3
Red Lion Hotel 91.00 93.4 56.42 89.2
Oxford Suites 90.00 92.4 58.50 92.5
Best Western Hilltop Inn 110.00 112.9 74.80 118.3
Ramada Limited Redding 75.00 77.0 39.00 61.7
Fairfield Inn & Suites Redding, CA 102.00 104.7 61.20 96.8
Average - Primary Competitors $97.42 100.0 % $63.22 100.0 %
The estimated base-year average rate for the subject property as if open and
stabilized is then adjusted annually with inflationary growth in 2011, and more
robust growth in 2012 and 2013, and inflationary growth thereafter. The following
February-2011 Projection of Occupancy and Average Rate
Sheraton Hotel Redding At Sundial Bridge – Redding, California 61