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Home My WebLink About2021-12-20-I01J_02 Hotel Feasibility Study Agreement AGENDA ITEM: CITY OF WAUKEE, IOWA CITY COUNCIL MEETING COMMUNICATION MEETING DATE: December 20, 2021 AGENDA ITEM: Consideration of approval of a resolution approving an agreement for Professional Consulting Services with Hotel R&D, LLC [Hotel Feasibility Study] FORMAT: Resolution SYNOPSIS INCLUDING PRO & CON: The Consultant will complete a hotel market & feasibility study which will evaluate market demand for new lodging development needs in the City of Waukee. Scope of services consists of a general market analysis, competitive supply analysis and a hotel demand analysis. FISCAL IMPACT INCLUDING COST/BENEFIT ANALYSIS: Services of Consultant A. Retainer $4,000 B. Final payment $4,000 Total $8,000 COMMISSION/BOARD/COMMITTEE COMMENT: STAFF REVIEW AND COMMENT: Staff recommends approval of the action plan. RECOMMENDATION: Approve the resolution. ATTACHMENTS: I. Proposed Resolution II. Agreement for Professional Consulting Services PREPARED BY: Jennifer Brown, Economic Development Coordinator REVIEWED BY: I1J2 THE CITY OF WAUKEE, IOWA RESOLUTION 2021- APPROVING AGREEMENT FOR PROFESSIONAL CONSULTING SERVICES WITH HOTEL R & D, LLC IN THE NAME AND BY THE AUTHORITY OF THE CITY OF WAUKEE, IOWA WHEREAS, the City of Waukee, Dallas County, State of Iowa, is a duly organized Municipal Organization; AND, WHEREAS, desires to retain the consultant services of Hotel R & D, LLC for a Hotel Market & Feasibility Study; AND, WHEREAS, the scope of services consists of a general market analysis, competitive supply analysis and a hotel demand analysis; NOW THEREFORE BE IT RESOLVED by the City Council of the City of Waukee that the Agreement for Professional Consulting Services between Hotel R & D, LLC and the City of Waukee [Hotel Market & Feasibility Study] is hereby approved. Passed by the City Council of the City of Waukee, Iowa, and approved the 20th day of December, 2021. ____________________________ Courtney Clarke, Mayor Attest: ___________________________________ Rebecca D. Schuett, City Clerk RESULTS OF VOTE: AYE NAY ABSENT ABSTAIN Anna Bergman Pierce R. Charles Bottenberg Chris Crone Larry R. Lyon Ben Sinclair Hotel R & D, LLC Hotel Research & Development Market/Feasibility Studies; Site Location; Development Ventures 944 Evans Street Oshkosh, Wisconsin 54901 Voice: (414)-379-2105 Email: mike@HotelRandD.com PROPOSAL FOR: HOTEL MARKET & FEASIBILITY STUDY City of Waukee Iowa November 10, 2021 Hotel R & D, LLC Hotel Research & Development Market/Feasibility Studies; Site Location; Development Ventures 944 Evans Street Oshkosh, Wisconsin 54901 Voice: (414)-379-2105 Email: mike@HotelRandD.com November 10, 2021 Jennifer Brown Economic Development Coordinator 204 W. Hickman Rd Waukee, IA 50263 PROPOSAL FOR HOTEL MARKET AND FEASIBILITY STUDY Dear Jennifer: I would like to submit this proposal for a Hotel Market and Feasibility Study for the City of Waukee, Iowa. I would appreciate the opportunity to evaluate the Waukee region for new lodging development needs. As you will read, Hotel R&D, LLC offers extensive experience in hotel feasibility studies and projects in a variety of Iowa and other midwestern markets. HOTEL R&D, LLC Michael P. Lindner is sole proprietor of Hotel R&D, LLC, a hotel consulting firm specializing in market research and feasibility analysis for new lodging developments. I began market research services in 1993 as an independent consultant to AmeriHost Inns, a limited-service hotel brand focused on secondary and tertiary communities throughout the United States. I have extensive knowledge of hotel operations ranging from our 3 family-owned motels to management positions with a Marriott Inn franchise, Hilton Garden Inn and an independent waterpark resort in Wisconsin Dells. I have also developed an extended stay hotel in Minneapolis, a Best Western in northern Wisconsin and a small independent resort in Door County Wisconsin. Since 1993, I have performed over 500 market studies. My experience in operations, development, and market research gives me a unique perspective on new market projects through the eyes of an operator, developer, and analyst. A resume and listing of previous assignments are attached to this proposal. Hotel R & D, LLC Hotel Research & Development Market/Feasibility Studies; Site Location; Development Ventures 944 Evans Street Oshkosh, Wisconsin 54901 Voice: (414)-379-2105 Email: mike@HotelRandD.com Waukee Iowa Market Study Proposal Page | 2 BACKGROUND AND UNDERSTANDING It is understood that the City of Waukee is interested in an independent evaluation of the potential of attracting new lodging development within the city limits. The impact of a new hotel in this region on the community (taxes, additional development appeal, and overall quality of life improvements) will be measured. The impact on existing lodging operations within the city and surrounding markets will also be evaluated and presented. The primary focus of this study will involve a thorough Hotel Demand Analysis as outlined below. The final report will provide a full hotel market and feasibility study, also outlined below. SCOPE OF PROJECT General Market Analysis The Hotel Market Analysis will provide a comprehensive analysis of the region encompassing but not limited to all of Waukee and Dallas County as well as the impact from neighboring communities throughout greater Des Moines as it correlates with the conditions and trends of the regional hospitality industry. Among the key factors to be presented are: o Demographics o Retail/Service industry sales trends o Highway traffic volume trends o Hotel lodging tax collection trends o Proposed sites and neighborhood analysis This analysis will encompass an evaluation of the sites’ accessibility, visibility, and physical characteristics that might affect the marketability of a new hotel project. Competitive Supply Analysis o Smith Travel Research report analysis (hotel occupancy and Average Daily Rate trends) o Seasonal occupancy and rate trends o Potential new lodging development and its impact o Peer city lodging performance and physical details in communities with similar features as those existing and proposed for Waukee. Hotel R & D, LLC Hotel Research & Development Market/Feasibility Studies; Site Location; Development Ventures 944 Evans Street Oshkosh, Wisconsin 54901 Voice: (414)-379-2105 Email: mike@HotelRandD.com Waukee Iowa Market Study Proposal Page | 3 Hotel Demand Analysis An emphasis on the unique hotel demand (rooms, catering, features) generated by local businesses and attractions will highlight the Demand Analysis section of the report. Among the strategies to complete this section will include the following steps: Interviews  City and tourism officials  Area businesses  Attraction and event venue staff Peer City/Similar Project Performance Aside from nearby hotel performance, the overall business demand generated in similar- size and demographic markets will be presented. This includes individual and group business visitations, attraction and event attendance, and lodging preferences. Full Hotel Market Study Final preparation and reporting of the Hotel Market and Feasibility Study will be completed and presented. The completed study will include: a. Executive Summary b. Conclusions and Recommendations of type of facility, size, features and amenities, potential branding, and optimum location c. Complete Market Description and background support data d. Site Analysis evaluating potential parcels with SWOT evaluation e. Maps, photos, interview results f. Copies of Smith Travel Research competitive set reports (if available) g. Complete financial analysis including a variety of project cost scenarios with Return on Investment h. Financial impact on city a. Hotel tax b. Property tax c. Sales tax d. Related industry impact Next Step Meeting After the final report is delivered and reviewed, a meeting will be scheduled, at your determined time, to discuss the project in general and answer any questions that may arise. Suggestions regarding location, features, franchising, and the overall development process, including issues and items not included in the final report can be discussed. Hotel R & D, LLC Hotel Research & Development Market/Feasibility Studies; Site Location; Development Ventures 944 Evans Street Oshkosh, Wisconsin 54901 Voice: (414)-379-2105 Email: mike@HotelRandD.com Waukee Iowa Market Study Proposal Page | 4 COST OF PROJECT The cost of the Hotel Market Study will include a full evaluation and analysis completed in a two-phase approach. The purpose of a two-phase process allows for the presentation of potential risks or other issues that would restrict the success of a new hotel. These risk factors, if any, will be explained in the preliminary conclusions that will be presented after the fieldwork and initial analysis. You will have the opportunity to forgo any further work on the study with no additional charges beyond the required retainer as described below. Compensation for the Hotel Market and Feasibility Study will be $8,000.00 inclusive of all expenses directly associated with the fieldwork and preparation of the study. It also includes required visits and meetings with the client. A retainer of $4,000.00 is required at the commencement of this project. The retainer is applied towards the purchase of Smith Travel Research reports as well as time, travel and other materials. This retainer includes the Phase One preliminary report and follow-up meeting. The balance of $4,000.00 will be due upon receipt of the final presented study. Fees are inclusive of all expenses directly associated with the fieldwork and preparation of the study. It also includes required visits and post-project meetings with the client. The balance of the project fee will be due upon receipt of the final presented study. TIMELINE OF PROJECT The Hotel Market Study is expected to take 60 days from commencement. Proposed Timeline: Week 1 Internal research and preparation including required appointments and STR report review. A copy of the planned fieldwork contacts and agenda will be sent to the appointed contact of the client. Week 2 Fieldwork visit to Waukee and region for demand generator interviews, existing hotel evaluations, and site analysis. Week 3 Compilation of fieldwork research and analysis of gathered data. Week 4 Preparation and delivery of the Preliminary Conclusions (Phase 1) with a summary of initial findings and draft financial projections. Schedule telephone conference with you to discuss first phase report. Hotel R & D, LLC Hotel Research & Development Market/Feasibility Studies; Site Location; Development Ventures 944 Evans Street Oshkosh, Wisconsin 54901 Voice: (414)-379-2105 Email: mike@HotelRandD.com Waukee Iowa Market Study Proposal Page | 5 Week 5 - 7 Assuming you approve of the completion of the study, the final draft of the Hotel Market & Feasibility Study will be submitted to you for final review and discussion. The completed study will be submitted, electronically (unless otherwise requested by the client) for completion of the project. Updates and modifications to the financial projections will be provided as the project becomes more defined. Your approval of this proposal/agreement is indicated by the receipt of this signed agreement and the required retainer fee. Again, I appreciate the opportunity to provide this proposal and am available for any comments or questions. A full resume of experience, including past market study locations, is included with this proposal. Sincerely, Approval: Michael P. Lindner Michael P. Lindner Signature Hotel R&D, Inc 944 Evans Street Oshkosh, Wisconsin 54901 Printed Name 414-379-2105 Date Hotel R & D, LLC Hotel Research & Development Market/Feasibility Studies; Site Location; Development Ventures 944 Evans Street Oshkosh, Wisconsin 54901 Voice: (414)-379-2105 Email: mike@HotelRandD.com SIMILAR MARKET EXPERIENCE AND REFERENCES Hotel R&D, LLC has been providing hotel market research and feasibility services to communities, private investors, lenders, and developers since 1993. Recent Hotel Market Studies of similar market environments include: City of Johnston Iowa (Town Center) Adam Plagge Economic Development Manager aplagge@cityofjohnston.com (515)-727-7774 Downtown Des Moines Jordan Kleinschmidt Troy Hansen Hansen Real Estate Services (515)-270-9166 jordan@HansenRES.com Town of Lawrence (Green Bay) Wisconsin (Sports Market lodging) Patrick Wetzel, Town Administrator 2400 Shady Ct Lawrence, Wisconsin Patrick Wetzel patrickw@townoflawrence.org