- 68-Room, Interior Corridor, Midscale Hotel Built in 2006
- Closest Hotel to Southland Mall, Located Less Than One Mile Away
- Priced Significantly Below Replacement Cost at $48,529 Per Key
- Hotel Outperformed Market Competitive Set RevPAR
- Operating as the Leading Hotel in the Market Competitive Set for Year-to-Date RevPAR
- Operational Upside for Prospective Hands-On Owner-Operator Investor
Investment Overview:
Marcus & Millichap's National Hospitality Group, as exclusive representative of the Seller, is pleased to present for sale to qualified investors the La Quinta Inn & Suites in Houma, Louisiana. The midscale hotel is part of Wyndham Hotels and Resorts, the largest hotel franchise company in the world. The 68-room property is offered at $3,300,000 or $48,529 per key. In addition, the limited-service hotel is listed below three times the gross room revenue, based on the most recent trailing twelve months, the year-end 2020.
Located in the south-central coastal area of the State, Houma is highly dependent on the oil and gas extraction industry in the Gulf of Mexico and the spillover sectors such as machinery, fabrication, shipbuilding and other marine related transportation. As a result, hotel demand in this area is less affected by the pandemic. Also, the La Quinta Inn & Suites Houma further benefits from additional leisure travel brought on due to the relation to Southland Mall.
The three-story, 2006 constructed hotel offers a new investor(s) the opportunity to acquire an upwardly trending asset at a price, that is well below replacement costs. Furthermore, an owner-operator can further take full advantage of reducing management and other labor costs thus, maximizing profits.
The hotel, according to year end 2020 financials, had a Net Operating Income (NOI) of $839,565 or 25% Cap Rate. Also, according to the December 2020 STR, the property showcased a monthly RevPar of $69.57, a 130%+ increase from 2019. Since this property is recently renovated, in 2016, the property was able to outperform the comp set in 2020 with a RevPar of $69.57 vs $51.02. It is anticipated that as demand in the market continues to improve, the property will be able to leverage location and guest satisfaction to sustain growth.
On the horizon, the area should see a significant increase in demand from a $35 Million to the South Lafourche Leonard Miller Junior Airport that currently brings in 140,000 passengers/year, more than half (approx. 80,000) are Chevron-related employees. In addition, Energy World LNG project is in the planning stage of an $888 Million export facility that will sit on 150 acres just south of the La Quinta Houma which is set to attract major business demand to the surrounding area.
Property Overview:
The La Quinta Inn & Suites midscale property is a 68-room hotel with three floors. The Wyndham Hotels & Resorts-branded property guest rooms feature a microwave, flat-screen television, and refrigerator. The featured amenities are an outdoor pool, exercise facility, business center, and meeting/event space.
The La Quinta by Wyndham contemporary-inspired midscale brand has 928 hotels in the United States, Canada, and Latin America as of December 31, 2019. With their strong brand awareness since 1968, their global footprint has been established with business and leisure travelers alike in the midscale segment. They are located in 24 out of the 25 top markets and currently have 250 hotels in the pipeline.
Location Overview:
Houma-Terrebonne, Louisiana is located in the southern part of the state, 57 miles from the New Orleans’ city center, and thrives on a diverse economy. The La Quinta Inn & Suites by Wyndham is strategically placed on 189 Synergy Center Boulevard and near several leisure and business demand generators. The Houma-Terrebonne Airport and industrial park is 800 acres for aircraft servicing and operation and 1,000 leasable acres within its industrial park. This is the southern-most latitude general aviation facility in the country and provides transportation support for the Central and South American markets.
Oil & Gas is another essential economic resource to Houma’s evolving economy. Federal grants have been approved to help modernize the infrastructure and in particular $135 million grant for the stretch of La. 1 to help elevate that last stretch below the flood-protection system. Legislatures have met with The White House to push for royalty relief and other measures to help the state weather the downturn economy.
Also, leisure travelers help incentivize the region’s economy and are drawn to market drivers such as the Downtown Marina, Southdown Plantation & Museum, swamp tours, Cajun cuisine, and much more. The city is also well-known for its two-week-long Cajun Mardi Gras celebration which attracts thousands of visitors annually and generates room demands.
Gulf Island Fabrication – Houma Shipyard:
Houma secured a contract to build two additional Navy ships with Gulf Island Fabrication, bringing the total to five which is a potential value of more than $522 million. The company will hire 106 employees at their Houma Shipyard to assist with the vessels’ fabrication and an average annual salary of $48,000. In reference to the Louisiana Economic Development statement, the hiring is projected to generate 123 indirect jobs in the Houma-Thibodaux area, in addition to the 308 jobs at the facility along the Houma Navigation Canal. Gulf Island Fabrication is also expected to capitalize on the six percent rebate of annual gross payroll rebate due to adding new jobs with a 10-year incentive in accordance with the LED FastStart workforce development program. The new jobs added an annual payroll expansion of $3.75 million.
