Hotel Development: Section 6 & 7 of Feasibility Study
Occupancy and Average Rate The purpose of this section is to discuss how the occupancy and average rate were determined for the subject property. =Introduction (Summarize what in the market may impact the occupancy and average rate. Explain the importance of this to the overall project. The introduction should be just three to four sentences. Then you start on the specifics below, each of the items below should be a subheading of this section.) Body of the Section Forecast of Subject Property’s Occupancy • What is the seasonality of the subject property and what occupancy is expected based on those seasons? • What is the mix of business for the property and how is this affected by the seasonality? • How does the competitive set compare to the subject property’s projections of occupancy? Discuss what the competitive set is currently achieving in occupancy. • What are the projections from industry on the occupancy for the next five years? Use the PKF Horizon report as the source for these projections, unless you have a better source. • The final portion of this section should be a chart reflecting the projected occupancy for five years of the subject property and a few sentences to explain the projection.
Section 7: Projection of Income and Expense The purpose of this section is to discuss how the financial proformas is being put together. Since the occupancy and rate derive the room revenue, there is no need to explain this further other than to repeat the process. Overall this section will describe the per occupied room or percentage figures used to project the revenues other than room and how the profit margins or expenses for the project were estimated. Most of the information will be obtained by using the PKF trends report provided on Blackboard. This section should be organized as follows: Introduction (Summarize how the process of forecasting the revenues and expenses for the subject property. Make sure to indicate that the measures used are industry comparables based per occupied rooms, per available rooms or percentage statistics. The introduction should be just three to four sentences. Then you start on the specifics below, each of the items below should be a subheading of this section.) Body of the Section Assumptions • What assumptions were used in developing the financial projections: o Inflation o Occupancy o Rate Please, make sure to review all the available course materials and incorporate proper information.
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APA Format, 1568 words