Increasing Revenue Trend, Operational Upside

• Since 2022, this 80-room hotel has averaged $1,628,454 in annual rooms revenue, demonstrating stable top-line performance.

• The hotel’s trailing-twelve-month (TTM) rooms revenue through March 2025 reached $1,867,125, reflecting a 5.31% increase over the amount earned in 2024.

• Since 2023, the hotel has averaged an annual gross operating profit (GOP) of 36.9%, an average net operating income (NOI) of $416,915, and a 30.3% flow-through rate.

• The hotel is currently absentee owned, presenting a clear opportunity for a more hands-on investor to streamline operations, reduce expenses, and enhance profitability.

Value-Add Potential Through PIP Completion

• Per the February 2025 STR data, the hotel ranked third out of five in terms of both ADR and in RevPAR, underscoring strong potential for rate growth.

• With year-to-date (YTD) February 2025 occupancy up 33.5%, a new owner can capitalize on this momentum by completing the Formula Blue PIP and repositioning the hotel to compete more effectively on rate.

• Based upon HVS’s pro-forma projections, stabilized rooms revenue in 2027 is anticipated to conservatively exceed $2 million, with an NOI flow-through of $745,000 (rounded).

Attractive Rooms Revenue Multiplier (RRM) of 2.99x, Priced at a Discount to Replacement Cost

• Based on the pricing guidance, the deal underwrites to an attractive 2.99x rooms revenue multiplier (RRM) based on the hotel’s TTM rooms revenue through February 2025.

• This offering provides an investor the opportunity to acquire a well-performing, IHG-branded asset at a pre-PIP basis of $70,000 per key.

• The Formula Blue PIP is expected to cost approximately $1,600,000, or $20,000 per key (rounded), resulting in an all-in basis that remains well below current development costs for comparable upper-midscale assets.

Long-Term Franchise Agreement with IHG

• Upon completion of the change-of-ownership PIP, an investor can expect a new long-term franchise license agreement with InterContinental Hotels Group (IHG), enhancing long-term brand security.

• The award-winning IHG® Rewards Club loyalty program is one of the largest in the hotel industry, offering members more choices to redeem their points than any other hotel loyalty program in the world. Serving over 100 million enrolled members worldwide, IHG Rewards Club is an effective tool for driving customers to IHG hotels and creating brand loyalty.

Robust Economic Developments

• Nissan Intelligent Factory: Earlier this year, Nissan announced a $661-million investment to transform its Canton facility into a “Nissan Intelligent Factory” in order to support the manufacture of next-generation electric vehicles, with production planned to start in 2028.

• Amazon Web Services (AWS) Investment: Last year, AWS announced a monumental $10-billion investment to establish multiple data center complexes in Madison County, including a significant facility in Canton. This project is set to create at least 1,000 high-paying, high-tech jobs, reflecting the largest economic development in Mississippi’s history.

• Clark Beverage Group Expansion: In May 2023, Clark Beverage Group, a leading distributor of beverages like Coca-Cola, unveiled plans for a $100-million expansion in Madison County, adding 30 new jobs and enhancing the area's industrial landscape.

Strong, Expanding Location Surrounding “Hotel Row”

• The hotel is positioned along Soldier Colony Road—Canton’s well-known “Hotel Row”—and is one of only three upper-midscale hotels in the market. This positioning provides a unique opportunity for a new owner to lead the market in terms of quality and service, especially as demand increases from incoming business travelers associated with major developments.

• Located just 30 miles north of Jackson, Mississippi’s capital and largest city, Canton offers convenient access to urban amenities and markets.

• The Grenada Railroad, a 228-mile short line running from Southaven to Canton, facilitates efficient transportation of goods, supporting local industries and enhancing supply-chain logistics.

Management Availability

• The hotel asset is being offered free and clear of any management encumbrances, providing an investor with the flexibility to revamp the operational strategies of the current operator.