Comfort Suites Galveston

3606 89th Street, Galveston, TX 77554, US

Execute Confidentiality Agreement


HVS, as the sole and exclusive advisory firm to Ownership, is pleased to present the opportunity to acquire the 57-key Comfort Suites Galveston, a limited-service hotel asset in Galveston, Texas. This offering would allow a private investor the ability to acquire an upper-midscale hotel asset at a price well below replacement cost with a minimal change-of-ownership PIP in a high-barriers-to-entry submarket.




Investment Type


Pricing Guidance




Year Built


Average Daily Rate






Room Revenue

20 Years

Expected Franchise Term

Financials as of Trailing-Twelve-Month (TTM) April 2024


Reduced Pricing Guidance

  • Ownership is motivated and has agreed to reduce the pricing guidance to $5,100,000.​​​​​​​

Ideal Opportunity for an Experienced Owner/Operator to Improve Performance and NOI Flow-Through

  • The 57-key count is considered an ideal size for an experienced owner/operator.

  • According to the past three years of financial statements, the hotel registered an average gross operating profit (GOP) below 30.0%.

  • Based on a selection of operating statements from similarly aged Choice-affiliated hotels, the hotel should achieve a stabilized GOP margin between 45.0% and 50.0%.

  • We see multiple opportunities for improvement that could lead to a collective decrease in rooms expense, specifically in the payroll department.

  • Per the March 2024 STR data, the hotel came in fifth out of six competitive hotels in terms of occupancy, with a 63.9% penetration index; in addition, it recorded the second lowest RevPAR among the competitive set. Given the upper-midscale brand affiliation and recently renovated product, there is flexibility for a new operator to increase occupancy and improve RevPAR.

  • Based on HVS pro-forma projections, stabilized rooms revenue in 2025 is anticipated to exceed $1,550,000 ($74.00 RevPAR), with an NOI flow-through of $487,000 (rounded).

High-Barriers-to-Entry Market with Beach Access

  • Galveston is a high-barriers-to-entry market due to limited developable land, limited franchise availability, strict zoning regulations, and a historic district that restricts new construction.

  • The property has an irreplaceable location just off Seawall Boulevard where guests can walk to the beach and Galveston Fishing Pier.

Robust Drive-to Leisure Market of Galveston

  • An investor will have an exceptional opportunity to purchase an asset strategically located within the “Texas Triangle” of Austin, Dallas, Houston, and San Antonio. There are approximately 21 million residents within a four-hour drive of Galveston.

  • There are numerous festivals, special events, sporting events, and gatherings held throughout the year in Galveston, with particularly strong demand generated during the spring and summer months.

  • Tourism demand in Galveston has increased in recent years along with city-wide efforts to improve local roads and infrastructure, expand the beaches, and improve the cruise-ship terminals. Per the 2023 Galveston Economic Impact of Tourism Study, completed by city officials last summer, tourist visitation reached a peak of 8.1 million visitors in 2022, a 25.0% increase from 2021 and a 10.9% increase from 2019. These visitors spent a record $1.2 billion, which directly affected the local economy.

Choice International Franchise

  • An investor can expect a new, 20-year franchise license agreement with Choice Hotels International upon completion of the brand-mandated change-of-ownership PIP.

  • Given the recent renovations, a minimal change-of-ownership PIP is expected.

Excellent Location Among Strong Corporate and Leisure Demand Generators

  • The property benefits from very good visibility along the Galveston Seawall and from its proximity to dining, retail, and entertainment options, which is a positive attribute for both business and transient guests. Guests can easily walk across the street to access the many beaches along Seawall Boulevard.

  • Corporate demand generators in the area include the University of Texas Medical Branch (UTMB), Galveston College, Texas A&M University, Landry’s, Moody Bank, American National Insurance Company, Mitchell Historic Properties, and Marathon Petroleum.

  • Leisure demand generators in the area include Moody Gardens, Schlitterbahn Water Park & Resort, Pleasure Pier, 61st Street Fishing Pier, Galveston Island Convention Center, and historic Downtown Galveston.



Margaritaville Beach Resort Galveston

Announced this past January, developers are expecting to break ground this year on the $700-million Margaritaville Resort on 95 acres of land to the east of the island. Along with the 15-story resort, the development will include a 2.5-acre elevated pool deck overlooking the beach, a water park with a lazy river, a large ballroom, multiple restaurants, and 278 multi-bedroom cottages for larger gatherings. This project will be the largest resort development in Galveston and the brand’s first lifestyle, ground-up resort development in Texas. Construction is slated for completion by 2026.


$250M Mixed-Use Development

On the west side of the island, a local developer recently completed the acquisition of a 16-acre parcel for a $250-million mixed-use development. Final plans for the project have not been released but are going through final reviews with local officials. The project is expected to break ground in 2025 and will be completed in phases. The first phase will include multiple restaurants and bars and a 10- to 12-story condo tower with over 270 multi-bedroom units. The second and third phases are anticipated to include a luxury hotel, an event center, multifamily apartments, and a senior living community.


Peninsula Beach Resort


Farther east of Galveston Island in Crystal Beach, developers broke ground last year on a 110-acre beach resort called the Peninsula. The development features a private airport, retail sites, a multi-story bar and restaurant, 90 single-family homes, 117 rental cottages, a clubhouse, 50 RV sites, and 5 beachside condominiums totaling 160 units. The private airport will make it the only fly-in beach resort in the country.



Investment Sales Contacts

Eric Guerrero

Senior Managing Director, Partner, Brokerage & Advisory
+1 (713) 955-0012

Fadi Rawashdeh

Senior Associate, Brokerage & Advisory
+1 (713) 955-0013

James Rebullida

Vice President, Brokerage & Advisory
+1 (713) 955-5580

Kyle Peterek

Senior Associate, Brokerage & Advisory
+1 (206) 259-7150