1) Located just 3 miles from Houston’s Chinatown, the Hotel is well situated to capture the Chinese market. By leveraging ASAP’s strong relationships in Houston, adding popular Chinese dishes to restaurant menus, a shuttle bus, and bi-lingual speaking staff, we can easily increase Chinese wedding, Chinese tourism group, and Chinese business group demand to the Hotel.
2) Oil prices bottomed around $28 per barrel early last year, which we believe has been stabilized now at around $45-$50 per barrel. We don’t anticipate any major disruptions in the energy sector in Houston.
3) Our cost basis for this hotel is approximately $80,000 per key, representing an all in CAP rate of 8.5%. This is over 50% below replacement cost.