Recently Completed $4-Million Renovation; Minor PIP

• Ownership recently completed an approximately $4.0-million renovation of the property, materially enhancing the guestrooms and public areas and positioning the asset in strong physical condition.

• Hilton issued a formal notice of completion in December 2025 confirming that all items outlined in the seller’s PIP were resolved to the brand’s satisfaction.

• Given the recent completion of the renovation, only a minor change-of-ownership property improvement plan (PIP) is expected, allowing a new owner to focus on revenue optimization rather than a significant near-term capital program.

• The hotel’s sustained rate premium reflects the quality of the newly renovated physical product, its Hampton by Hilton affiliation, and its desirable location within Galveston’s primary leisure corridor.

 Premier Galveston Location Near Beaches, Cruise Activity, and Major Attractions

• The property is located just steps from Seawall Boulevard and Galveston’s beaches, providing convenient access to the island’s principal leisure, entertainment, and convention demand generators.

• Nearby attractions include Moody Gardens, Schlitterbahn Galveston Island Waterpark, the Galveston Island Historic Pleasure Pier, the Strand Historic District, and the Port of Galveston Cruise Terminal.

• The Galveston Island Convention Center offers approximately 100,000 square feet of meeting space, while the broader market benefits from festivals, sporting events, weddings, and other group-related activity throughout the year.

 Recent Performance Momentum

• Comparing the hotel’s year-to-date (YTD) RevPAR through May 2026 against its RevPAR last year (LY) in 2025 ($99.50 YTD vs. $93.69 LY), a 6.2% gain was registered. Per the latest available data, the hotel posted a month-over-month RevPAR increase of 16.1% in May ($117.20 May vs. $104.84 April), driven by sustained rate growth.

• The hotel’s ADR was up 9.0% YTD over the rate commanded during the same period last year ($152.11 vs. $139.56), reflecting strong pricing power without sacrificing demand.

• Total revenue amounted to $1.65 million (rounded) for the YTD period through May, reflecting a 4.5% increase over the $1.58 million earned in 2025.

• The hotel has outperformed its competitive set by a wide margin, having registered a RevPAR index of 145.3% and an occupancy index of 131.1% in May 2026, with the hotel ranking #1 of five hotels in its competitive set in terms of RevPAR that month.

• Rate strength has more than offset a modest YTD occupancy dip (65.4% vs. 67.1% LY), a function of the renovation period and now fully resolved, underscoring the asset's brand and market positioning heading into a stabilized year.

 Stable Historical Top-Line Performance with a Proven Operating Track Record

• From 2022 through 2025, a period that included renovation-related disruption, the hotel generated average annual rooms revenue of approximately $3.76 million and average total revenue of approximately $4.02 million.

• Rooms revenue remained resilient throughout the period, ranging from approximately $3.61 million to $3.91 million, despite the renovation-related disruption and normal fluctuations within Galveston’s seasonal lodging market.

 Management Availability

• The hotel asset is being offered free and clear of any management encumbrances, providing an investor with the flexibility to install its preferred management company or to self-operate upon approval by Hilton.

Compelling Operational Upside, Forward-Looking Revenue and NOI Flow-Through Growth

• The hotel generated a gross operating profit (GOP) of approximately $1.56 million, representing a 40.1% margin, for the trailing-twelve-month (TTM) period ending April 2026.

• Based upon HVS pro-forma projections, GOP is anticipated to increase to approximately $1.90 million in 2026/27, expanding the margin to 46.0%.

• The 2026/27 pro forma reflects NOI flow-through of approximately $1.18 million, highlighting substantial upside through improved expense controls and operating efficiencies.

• HVS projects rooms revenue to increase to approximately $3.88 million in 2026/27 and exceed $4.1 million in 2027/28.

• RevPAR is forecast to increase from approximately $96 in the trailing base year to over $102 in 2026/27 and approximately $109 in 2027/28, supported by increasing occupancy and continued ADR growth.

• By the stabilized 2028/29 year, the hotel is projected to generate approximately $4.58 million in total revenue and more than $1.37 million in EBITDA Less Replacement Reserve.

Highly Sought-After Hampton by Hilton Franchise, 15-Year FLA

• Upon acquisition and franchise approval, an investor can expect a new, 15-year franchise license agreement (FLA) with Hilton, providing long-term stability.

• The Hampton Inn & Suites platform is one of Hilton’s most recognized limited-service brands, offering broad appeal across leisure, corporate, group, and family-oriented travelers.

• Hilton affiliation provides access to a global reservation system, advanced technology platform, and the Hilton Honors loyalty program, supporting occupancy, average rate, and long-term brand recognition.

• The combination of a newly renovated physical product, an established Hilton flag, and consistent competitive-set outperformance enhance financing appeal and long-term exit liquidity.

Diversified Demand Beyond Traditional Beach Tourism and Expanding Cruise Infrastructure

• While Galveston remains a leading Texas leisure destination, the market also benefits from year-round institutional, healthcare, education, maritime, and industrial demand.

• The University of Texas Medical Branch (UTMB), Texas A&M University at Galveston, and Galveston College collectively enroll more than 8,200 students and generate demand related to medical care, research, academics, commencement, and visiting families.

• The Port of Galveston, area refineries, petrochemical facilities, and maritime employers support contractor, crew, vendor, project, and corporate lodging demand, helping moderate the market’s traditional seasonality.

• Royal Caribbean’s third cruise terminal and the arrival of Carnival Jubilee have expanded the Port’s ability to accommodate larger vessels, supporting pre- and post-cruise stays and continued visitation growth.

More Than $1 Billion in Planned and Underway Development

• More than $1 billion in developments are underway or planned across the Galveston market, reflecting continued private-sector confidence and broadening the island’s appeal.

• Major projects include the $700-million (rounded) Margaritaville Resort, a planned $250-million mixed-use development on the island’s west side, a ten-story luxury condominium development along the western seawall, and the Peninsula beach resort in Crystal Beach.

• These projects are expected to expand Galveston’s attractions, meeting facilities, residential base, and visitor amenities, supporting long-term lodging demand and rate growth.