first busey corporation ramada inn – bloomington, il

First Busey CorporationFirst Busey CorporationRamada Inn – Bloomington, ILRamada Inn – Bloomington, IL

2

Contents

• Project Objectives

• Project Process

• Current Hotel Status

• Alternative Uses– Alternative Use Description– Projected Financials– Circumstances Required for 20% ROR

• Recommended Alternative Use

• Appendix

3

Project Objectives

• What alternative uses are available for Ramada Inn – Bloomington, IL

• What do each of these alternative uses entail

• How viable is each alternative use, financially

• Which alternative use is recommended

4

Project Process

Research Ramada Inn – Bloomington, IL

competitors

Research nationwide and Bloomington specific hospitality industry conditions and trends

Determine viable alternative uses

Develop recommendations if Ramada Inn - Bloomington,

IL were to remain a hotel

Research independent living market in

Bloomington

Research independent living facilities in

Bloomington and elsewhere

Develop plan for Ramada Inn – Bloomington, IL to become an independent living facility

Project financials for each alternative use based on research findings

Evaluate alternative uses based on projected financials and research findings

Research

Research

Financials

Outputs

Recommendations

Recommendations

5

Current Situation of the Hotel

• 209 individual rooms total

• 160 in use

• 49 unused due to poor room condition

• Furniture and decoration are outdated

• 35% occupancy rate

• Associated facilities include lounge, cafe, indoor pool, conference room, kitchen space, gaming room, exercise room and business center (under construction)

• Bloomington City is going to construct an Arena and a conference center, which are expected to be beneficial to the local hospitality industry

Alternative UsesAlternative Uses

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Alternative Uses

• OSBI Consulting Changes (if remaining as hotel)– Renovation of south wing into suites to attract corporate travelers

– Convert atrium into coffeehouse/dining area

– Make finger food available to guests for purchase

• No Change– No significant changes to physical structure of hotel

– Increase marketing efforts to attract untargeted potential customers

• Complete Renovation (as recommended by Broeren Russo Builders, Inc.)– Turn south wing into 13,000 feet of conference space

– Renovate 100 existing rooms on north and east side of the pool

• Independent Living– Complete renovation of hotel into independent living facility

– Significant decrease in number of rooms

– Addition of elevators and services

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Financial Summary

Changes to get 20% ROR

NPVDiscounted Net

Sale Price @ 2010 ROR Occupancy ADRScenario 1: OSBI Changes $3,882,689.38 $3,213,754.49 -19.27% No increase

Increase ADR by $5 in 2005

Scenario 2: Unchanged $564,362.49 $338,656.27 -85.89%

Increase Rooms Sold each year by additional

9100 roomsIncrease ADR growth rate

additional 0.12%

Scenario 3: Complete Renovation $427,741.88 $3,952,581.76 -95.35%


3600 rooms

Increase ADR growth rate additional 1.4%; Increase

ADR $15 in 2006Scenario 4: Independent Living $4,176,353.26 $7,037,453.19 2.00%

85% in 2006, 90% in 2007, 95% thereafter

$2500/month for 1 BR; $3100/month for 2 BR

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Opportunity description– Use atrium as dining area/coffeehouse, which would

include purchasing new tables and chairs– Move big screen TV from the bar to the new dining area– Move arcade games to room 106 and consolidate

vending machines in room 108 to provide a single area customers can go to

– Convert existing dining area into reading lounge, including magazines and couches

– Provide finger food for guests late at night, possibly including pizza, chicken fingers, and fries

– Convert south wing lower level rooms into suites – Slightly renovate current conference area, possibly

including new carpet and a wall between the conference area and the pool instead of a curtain

– Add a barrier between the new dining area/coffeehouse and the pool to lessen noise interference, with the barrier possibly consisting of greenery

– Possibly pursue deals with neighboring restaurants to increase convenience for hotel guests

Key Benefits1. Apart from room renovations, most of which are

necessary, the changes do not require extensive capital2. Creates comfortable areas for corporate and family

guests to spend time within the hotel3. Creates suites, which are attractive to both corporate

and family guests4. Provides food for guests, increasing convenience for

guests

Potential Business Risks– Providing finger food to guests may be a tricky endeavor,

with hiring serving staff and starting something completely new

– It is difficult to forecast whether potential guests will be attracted to the efficiencies

Key Investments (one-time and major ongoing)– Convert lower level south wing into business suites– Make finger food available to guests for purchase– Purchase additional/new furniture for suites, new dining

area, and reading lounge– Convert Lobby to WiFi and install business center

Scenario 1: OSBI Consulting Changes (if remaining as hotel)

10

Bloomington-Normal Status

• Downtown Bloomington Arena– August 10, 2004: A 7-1 city council vote Monday on the price of the Bloomington

arena clears the way for construction on the $37 million project – The council accepted the guaranteed maximum price of the arena and public skating

rink at its meeting

• Normal Conference Center– July 6, 2004: Unanimous vote by the Normal Town Council endorsing the hotel-

conference center – Proposal represented the culmination of three-plus years of study, rejection,

revision, negotiation, analysis, selection and consensus– Wayne Aldrich, Normal Downtown Development Director, during a phone interview

said town council used an HVS International study (dated pre 9/11) for conference center demand analysis

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OSBI Changes

• Local market factors– Bloomington-Normal Area Convention & Visitors Bureau forecasts new downtown Bloomington

Arena will annually attract the following from outside the area: 21,000 business travelers 42,000 sporting fans 4,000 entertainment/leisure visitors

– Starting in 2006, Ramada will attract the following from new Arena: 1000 business travelers to stay 2 nights 2000 sporting fans to stay 1 night 200 entertainment/leisure visitors to stay 1 night Total = 4200 Rooms Sold

– New luxury hotel/conference will be built in downtown Normal Starting in 2007, Ramada will attract 500 business travelers to stay 2 nights Total = 1000 Rooms Sold

• Macro-economic factors– In addition, due to improving hospitality market, Rooms Sold will increase 4% annually:

2006: 1030 Rooms Sold 2007: 1240 Rooms Sold 2008: 1330 Rooms Sold 2009: 1380 Rooms Sold 2010: 1440 Rooms Sold

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Projected Financials OSBI Recommendation Scenario (if remaining as hotel)2005 2006 2007 2008 2009 2010

Room Statistics Occupancy Rate:

Rooms Available 67704 62640 62640 62640 62640 62640 2005 38.00% 4.0%Yearly Growth Rooms Sold

Rooms Sold 25728 30957 33195 34523 35904 37340 2006 49.42%Occupancy Rate 38.00% 49.42% 52.99% 55.11% 57.32% 59.61% 2007 52.99%Average Room Rate $55.00 $56.43 $57.90 $59.40 $60.95 $62.53 2008 55.11%

2009 57.32%REVENUE 2010 59.61%Room Revenue $1,415,013.60 $1,746,882.11 $1,921,890.27 $2,050,733.79 $2,188,214.99 $2,334,912.92 Average Room Rate:Food Revenue $81,185.42 $83,620.99 $86,129.62 $88,713.50 $91,374.91 $94,116.16 2005 $55.00 2.6% Yearly Growth ADRBeverage $90,665.54 $93,385.51 $96,187.08 $99,072.69 $102,044.87 $105,106.21 2006 $56.43Telephone $3,750.02 $3,862.52 $3,978.40 $4,097.75 $4,220.69 $4,347.31 2007 $57.90Sundry $52,416.29 $53,988.78 $55,608.44 $57,276.69 $58,994.99 $60,764.84 2008 $59.40

2009 $60.95Total Revenue $1,643,030.88 $1,981,739.91 $2,163,793.80 $2,299,894.43 $2,444,850.44 $2,599,247.44 2010 $62.53

Yearly Rev/Exp Growth rate:COST OF SALES 2005 3.00%Rooms $397,490.18 $478,279.79 $512,860.98 $533,375.42 $554,710.44 $576,898.86 2006 3.00%Food (includes add. Food cost) $136,894.94 $141,001.79 $145,231.85 $149,588.80 $154,076.47 $158,698.76 2007 3.00%Beverage $68,716.66 $70,778.16 $72,901.50 $75,088.55 $77,341.20 $79,661.44 2008 3.00%Telephone & Sundry $4,825.34 $4,970.10 $5,119.21 $5,272.78 $5,430.97 $5,593.90 2009 3.00%

2010 3.00%TOTAL COST OF SALES $607,927.13 $695,029.84 $736,113.54 $763,325.55 $791,559.07 $820,852.95 Yearly Food Cost Additions $72,000.00

Yearly Reduced Services Cost $10,000.00GROSS OPERATING INCOME $1,035,103.75 $1,286,710.07 $1,427,680.26 $1,536,568.88 $1,653,291.37 $1,778,394.49 Upfront Internet Costs $10,000.00

Upfront Business Center Costs $1,500.00UNDISTRIBUTED OPER Furniture $168,000.00Admin & General $183,427.34 $188,930.16 $194,598.07 $200,436.01 $206,449.09 $212,642.56 Conversion of Atrium $15,000.00Marketing & Sales (incl. Add cost) $153,694.89 $158,305.73 $163,054.91 $167,946.55 $172,984.95 $178,174.50 Remodeling South Wing $615,000.00Repair & Maintenance $170,498.78 $175,613.75 $180,882.16 $186,308.62 $191,897.88 $197,654.82 Discount Rate 13.00%Utilities $250,042.80 $257,544.08 $265,270.41 $273,228.52 $281,425.37 $289,868.14 Overall Cap Rate 10.30%Operating InterestManagement Fees $61,800.00 $63,654.00 $65,563.62 $67,530.53 $69,556.44 $71,643.14Franchise Fees $106,647.02 $109,846.43 $113,141.83 $116,536.08 $120,032.17 $123,633.13Depreciation (15 year/straight) $53,966.67 $53,966.67 $53,966.67 $53,966.67 $53,966.67

TOTAL OPERATING EXPENSES $926,110.84 $1,007,860.83 $1,036,477.66 $1,065,952.99 $1,096,312.58 $1,127,582.95

Income before Fixed $108,992.91 $278,849.23 $391,202.61 $470,615.89 $556,978.79 $650,811.54Insurance $24,250.32 $24,977.83 $25,727.16 $26,498.98 $27,293.95 $28,112.77TOTAL INCOME $84,742.59 $253,871.40 $365,475.44 $444,116.91 $529,684.84 $622,698.77Taxes $57,612.43 $59,340.80 $61,121.03 $62,954.66 $64,843.30 $66,788.60Subtract: Capital Expenditures $809,500.00Add: Depreciation $53,966.67 $53,966.67 $53,966.67 $53,966.67 $53,966.67CASH FLOW -$782,369.84 $248,497.27 $358,321.08 $435,128.92 $518,808.21 $609,876.84DISCOUNTED CASH FLOW -$782,369.84 $219,909.09 $280,617.97 $301,566.17 $318,194.79 $331,016.71

NPV $3,882,689.38 $3,213,754.49Rate of Return -19.27% Including $4M Sunk Cost

Discounted Net Sale Price @ 2010

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Projected Financials OSBI Recommendations Scenario 20% ROR (if remain hotel)2005 2006 2007 2008 2009 2010

Room Statistics Occupancy Rate:

Rooms Available 67704 62640 62640 62640 62640 62640 2005 38.00% 4.0%Yearly Growth Rooms Sold

Rooms Sold 25728 30956 33193 34519 35899 37334 2006 49.42%Occupancy Rate 38.00% 49.42% 52.99% 55.11% 57.31% 59.60% 2007 52.99%Average Room Rate $60.00 $61.56 $63.16 $64.80 $66.49 $68.22 2008 55.11%

2009 57.31%REVENUE 2010 59.60%Room Revenue $1,543,651.20 $1,905,633.37 $2,096,478.20 $2,236,949.76 $2,386,833.41 $2,546,759.81 Average Room Rate:Food Revenue $81,185.42 $83,620.99 $86,129.62 $88,713.50 $91,374.91 $94,116.16 2005 $60.00 2.6% Yearly Growth ADRBeverage $90,665.54 $93,385.51 $96,187.08 $99,072.69 $102,044.87 $105,106.21 2006 $61.56Telephone $3,750.02 $3,862.52 $3,978.40 $4,097.75 $4,220.69 $4,347.31 2007 $63.16Sundry $52,416.29 $53,988.78 $55,608.44 $57,276.69 $58,994.99 $60,764.84 2008 $64.80

2009 $66.49Total Revenue $1,771,668.48 $2,140,491.17 $2,338,381.73 $2,486,110.39 $2,643,468.87 $2,811,094.33 2010 $68.22

Yearly Rev/Exp Growth rate:COST OF SALES 2005 3.00%Rooms $397,490.18 $478,265.68 $512,829.34 $533,324.31 $554,638.36 $576,804.20 2006 3.00%Food (includes add. Food cost) $136,894.94 $141,001.79 $145,231.85 $149,588.80 $154,076.47 $158,698.76 2007 3.00%Beverage $68,716.66 $70,778.16 $72,901.50 $75,088.55 $77,341.20 $79,661.44 2008 3.00%Telephone & Sundry $4,825.34 $4,970.10 $5,119.21 $5,272.78 $5,430.97 $5,593.90 2009 3.00%

2010 3.00%TOTAL COST OF SALES $607,927.13 $695,015.74 $736,081.89 $763,274.44 $791,486.99 $820,758.30 Yearly Food Cost Additions $72,000.00

Yearly Reduced Services Cost $10,000.00GROSS OPERATING INCOME $1,163,741.35 $1,445,475.43 $1,602,299.84 $1,722,835.95 $1,851,981.88 $1,990,336.04 Upfront Internet Costs $10,000.00

Upfront Business Center Costs $1,500.00UNDISTRIBUTED OPER Furniture $168,000.00Admin & General $183,427.34 $188,930.16 $194,598.07 $200,436.01 $206,449.09 $212,642.56 Conversion of Atrium $15,000.00Marketing & Sales (incl. Add cost) $153,694.89 $158,305.73 $163,054.91 $167,946.55 $172,984.95 $178,174.50 Remodeling South Wing $615,000.00Repair & Maintenance $170,498.78 $175,613.75 $180,882.16 $186,308.62 $191,897.88 $197,654.82 Discount Rate 13.00%Utilities $250,042.80 $257,544.08 $265,270.41 $273,228.52 $281,425.37 $289,868.14 Overall Cap Rate 10.30%Operating InterestManagement Fees $61,800.00 $63,654.00 $65,563.62 $67,530.53 $69,556.44 $71,643.14Franchise Fees $106,647.02 $109,846.43 $113,141.83 $116,536.08 $120,032.17 $123,633.13Depreciation (15 year/straight) $53,966.67 $53,966.67 $53,966.67 $53,966.67 $53,966.67


Income before Fixed $237,630.51 $437,614.60 $565,822.18 $656,882.97 $755,669.30 $862,753.08Insurance $24,250.32 $24,977.83 $25,727.16 $26,498.98 $27,293.95 $28,112.77TOTAL INCOME $213,380.19 $412,636.77 $540,095.02 $630,383.99 $728,375.36 $834,640.31Taxes $57,612.43 $59,340.80 $61,121.03 $62,954.66 $64,843.30 $66,788.60Subtract: Capital Expenditures $809,500.00Add: Depreciation $53,966.67 $53,966.67 $53,966.67 $53,966.67 $53,966.67CASH FLOW -$653,732.24 $407,262.63 $532,940.65 $621,395.99 $717,498.72 $821,818.38DISCOUNTED CASH FLOW -$653,732.24 $360,409.41 $417,370.71 $430,658.59 $440,055.40 $446,050.09

NPV $5,771,395.39 $4,330,583.43Rate of Return 20.00% Including $4M Sunk Cost


14

Opportunity description– Continue operating Ramada in Bloomington without major

physical changes– Implement marketing strategies to increase occupancy

rates– Target currently untargeted groups, such as tourist

groups that stay overnight in Bloomington– Increase the number of free stay offerings over radio

shows and other forms of media to get the word about Ramada out to the community to transform Ramada’s previous negative reputation

– Offer discounts for referrals to promote word-of-mouth advertisement

Key Benefits1. Reliable figures for accurate prediction2. Little capital required3. Stable operations and practiced procedures

Potential Business Risks– If demand for hotel rooms doesn’t seem to be increasing,

it will be difficult to continue stealing market share from other hotels and increase Ramada’s occupancy rates

– Without change, it is difficult to raise the value of the hotel to potential buyers

Key Investments (one-time and major ongoing)– Perhaps hire additional marketing staff to increase

efforts

Scenario 2: No Change

15

Complete Renovation / Unchanged Scenario Figures

• For the Complete Renovation scenario, local market and macro-economic factors remain the same as OSBI Changes

– In addition, Rooms Sold will increase 2% annually due to upgrade to luxury hotel: 2006: 620 Rooms Sold 2007: 670 Rooms Sold 2008: 690 Rooms Sold 2009: 720 Rooms Sold 2010: 750 Rooms Sold

• For the Unchanged scenario, rooms sold will only increase by macro-economic factors

– On average, this equates to yearly increase of 500 rooms sold (2% increase)

16

Projected Financials Unchanged Scenario2005 2006 2007 2008 2009 2010

Room Statistics Increase of Rooms Sold:Rooms Available 67704 67704 67704 67704 67704 67704 2005 2.00%Rooms Sold 23770 24245 24730 25225 25729 26244 2006 2.00%Occupancy Rate 35.11% 35.81% 36.53% 37.26% 38.00% 38.76% 2007 2.00%Average Room Rate $55.00 $55.69 $56.38 $57.09 $57.80 $58.52 2008 2.00%

2009 2.00%REVENUE 2010 2.00%Room Revenue $1,307,354.40 $1,350,170.26 $1,394,388.33 $1,440,054.55 $1,487,216.34 $1,535,922.67 Average Room Rate:Food Revenue $81,185.42 $83,620.99 $86,129.62 $88,713.50 $91,374.91 $94,116.16 2005 $55.00 1.25% Growth of ADRBeverage $90,665.54 $93,385.51 $96,187.08 $99,072.69 $102,044.87 $105,106.21 2006 $55.69Telephone $3,750.02 $3,862.52 $3,978.40 $4,097.75 $4,220.69 $4,347.31 2007 $56.38Sundry $52,416.29 $53,988.78 $55,608.44 $57,276.69 $58,994.99 $60,764.84 2008 $57.09

2009 $57.80Total Revenue $1,535,371.68 $1,585,028.06 $1,636,291.86 $1,689,215.19 $1,743,851.79 $1,800,257.19 2010 $58.52

Growth rate:COST OF SALES 2005 3.00%Rooms $367,247.74 $374,592.69 $382,084.54 $389,726.24 $397,520.76 $405,471.18 2006 3.00%Food (includes add. Food cost) $64,894.94 $66,841.79 $68,847.05 $70,912.46 $73,039.83 $75,231.03 2007 3.00%Beverage $68,716.66 $70,778.16 $72,901.50 $75,088.55 $77,341.20 $79,661.44 2008 3.00%Telephone & Sundry $4,825.34 $4,970.10 $5,119.21 $5,272.78 $5,430.97 $5,593.90 2009 3.00%

2010 3.00%TOTAL COST OF SALES $505,684.68 $517,182.74 $528,952.30 $541,000.02 $553,332.76 $565,957.54

GROSS OPERATING INCOME $1,029,687.00 $1,067,845.31 $1,107,339.57 $1,148,215.17 $1,190,519.03 $1,234,299.66

UNDISTRIBUTED OPERAdmin & General $183,427.34 $188,930.16 $194,598.07 $200,436.01 $206,449.09 $212,642.56Marketing & Sales $143,694.89 $148,005.73 $152,445.91 $157,019.28 $161,729.86 $166,581.76Repair & Maintenance $170,498.78 $175,613.75 $180,882.16 $186,308.62 $191,897.88 $197,654.82 Discount Rate 13.50%Utilities $250,042.80 $257,544.08 $265,270.41 $273,228.52 $281,425.37 $289,868.14 Overall Cap Rate 12.13%Operating InterestManagement Fees $61,800.00 $63,654.00 $65,563.62 $67,530.53 $69,556.44 $71,643.14Franchise Fees $106,647.02 $109,846.43 $113,141.83 $116,536.08 $120,032.17 $123,633.13

TOTAL OPERATING EXPENSES $916,110.84 $943,594.17 $971,901.99 $1,001,059.05 $1,031,090.82 $1,062,023.55

Income before Fixed $113,576.16 $124,251.15 $135,437.58 $147,156.12 $159,428.21 $172,276.11Insurance $24,250.32 $24,977.83 $25,727.16 $26,498.98 $27,293.95 $28,112.77

TOTAL INCOME $89,325.84 $99,273.32 $109,710.41 $120,657.14 $132,134.26 $144,163.34Taxes $57,612.43 $59,340.80 $61,121.03 $62,954.66 $64,843.30 $66,788.60CASH FLOW $31,713.41 $39,932.51 $48,589.38 $57,702.48 $67,290.96 $77,374.75DISCOUNTED CASH FLOW $31,713.41 $35,182.83 $37,718.09 $39,464.52 $40,548.36 $41,079.01

NPV $564,362.49 $338,656.27Rate of Return -86% Including $4M Sunk Cost


17

Projected Financials Unchanged Scenario 20% ROR2005 2006 2007 2008 2009 2010

Room Statistics Increase of Rooms Sold:Rooms Available 67704 67704 67704 67704 67704 67704 2005 10.00%Rooms Sold 25634 28198 31018 34119 37531 41284 2006 10.00%Occupancy Rate 37.86% 41.65% 45.81% 50.39% 55.43% 60.98% 2007 10.00%Average Room Rate $55.00 $55.75 $56.52 $57.30 $58.08 $58.88 2008 10.00%

2009 10.00%REVENUE 2010 10.00%Room Revenue $1,409,892.00 $1,572,166.33 $1,753,117.95 $1,954,896.56 $2,179,899.28 $2,430,799.13 Average Room Rate:Food Revenue $81,185.42 $83,620.99 $86,129.62 $88,713.50 $91,374.91 $94,116.16 2005 $55.00 1.37% Growth of ADRBeverage $90,665.54 $93,385.51 $96,187.08 $99,072.69 $102,044.87 $105,106.21 2006 $55.75Telephone $3,750.02 $3,862.52 $3,978.40 $4,097.75 $4,220.69 $4,347.31 2007 $56.52Sundry $52,416.29 $53,988.78 $55,608.44 $57,276.69 $58,994.99 $60,764.84 2008 $57.30

2009 $58.08Total Revenue $1,637,909.28 $1,807,024.13 $1,995,021.48 $2,204,057.20 $2,436,534.74 $2,695,133.66 2010 $58.88



GROSS OPERATING INCOME $1,103,420.86 $1,228,777.45 $1,368,931.44 $1,525,638.89 $1,700,863.76 $1,896,802.43

UNDISTRIBUTED OPERAdmin & General $183,427.34 $188,930.16 $194,598.07 $200,436.01 $206,449.09 $212,642.56Marketing & Sales $143,694.89 $148,005.73 $152,445.91 $157,019.28 $161,729.86 $166,581.76Repair & Maintenance $170,498.78 $175,613.75 $180,882.16 $186,308.62 $191,897.88 $197,654.82 Discount Rate 13.50%Utilities $250,042.80 $257,544.08 $265,270.41 $273,228.52 $281,425.37 $289,868.14 Overall Cap Rate 12.13%Operating InterestManagement Fees $61,800.00 $63,654.00 $65,563.62 $67,530.53 $69,556.44 $71,643.14Franchise Fees $106,647.02 $109,846.43 $113,141.83 $116,536.08 $120,032.17 $123,633.13

TOTAL OPERATING EXPENSES $916,110.84 $943,594.17 $971,901.99 $1,001,059.05 $1,031,090.82 $1,062,023.55

Income before Fixed $187,310.02 $285,183.28 $397,029.45 $524,579.84 $669,772.94 $834,778.88Insurance $24,250.32 $24,977.83 $25,727.16 $26,498.98 $27,293.95 $28,112.77

TOTAL INCOME $163,059.70 $260,205.46 $371,302.29 $498,080.86 $642,478.99 $806,666.11Taxes $57,612.43 $59,340.80 $61,121.03 $62,954.66 $64,843.30 $66,788.60CASH FLOW $105,447.26 $200,864.65 $310,181.26 $435,126.20 $577,635.69 $739,877.51DISCOUNTED CASH FLOW $105,447.26 $176,973.26 $240,781.89 $297,596.39 $348,073.19 $392,808.18

NPV $4,799,999.86 $3,238,319.69Rate of Return 20% Including $4M Sunk Cost


18

Opportunity description– Demolish and dispose of existing south wing of 55 rooms

and convert the space into 13,000 square feet of conference space (total capacity of approximately 425 people)

– Completely renovate the 100 existing hotel rooms on the north and east side of the pool (reconfigure bathrooms, apply new wall, ceiling, and floor finishes, re-use electrical systems and heating/cooling systems, provide sprinkler systems, re-finish aluminum framing at the front of all hotel rooms, dispose of glass corridor enclosure and replace with metal stud framing, EIFS, exterior skin, punch windows, and drywall finish)

– Re-roof existing areas– Replace Kalwall skylights– Furnishings such as beds, tables, chairs, TVs, lamps,

artwork, and accessories are not included

Key Benefits1. Extensive amount of conference space, which is in high

demand (add additional info)2. Competitive rooms that would attract corporate

customers3. Improve Ramada’s image in the Bloomington

community4. Ability to charge higher prices

Potential Business Risks– Incredibly high initial investment with low likelihood

of high rate of return– New conference center in the works in Bloomington,

which would increase supply greatly, thus lowering the payoff from Ramada’s new conference rooms

– Facilities will only match, and not surpass facilities of other top hotels, so Ramada may not be able to draw price-insensitive corporate customers from other top hotels

Key Investments (one-time and major ongoing)– Converting the south wing into 13,000 square feet of

conference space ($2,050,000)– Renovate 100 existing hotel rooms on the north and east

side of the pool ($1,934,000)– Re-roof existing areas ($400,000)– Replace Kalwall skylights ($85,000)

Scenario 3: Complete Renovation (as recommended by Broeren Russo Builders, Inc.)

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Projected Financials Complete Renovation Scenario2005 2006 2007 2008 2009 2010

Room Statistics Occupancy (Rooms Sold): Growth of Rooms Sold:

Rooms Available 67704 47904 47904 47904 47904 47904 2005 25728 2.0%(in addition OSBI recommendations)

Rooms Sold 25728 31576 33859 35213 36622 38087 2006 31576Occupancy Rate 38.00% 65.91% 70.68% 73.51% 76.45% 79.51% 2007 33859Average Room Rate $55.00 $56.65 $58.35 $60.10 $61.90 $63.76 2008 35213

2009 36622REVENUE 2010 38087Room Revenue $1,415,040.00 $1,788,766.42 $1,975,643.08 $2,116,308.87 $2,266,990.06 $2,428,399.75 Average Room Rate:Food Revenue $81,185.42 $83,620.99 $86,129.62 $88,713.50 $91,374.91 $94,116.16 2005 $55.00 3.0% Growth of ADRBeverage $90,665.54 $93,385.51 $96,187.08 $99,072.69 $102,044.87 $105,106.21 2006 $56.65Telephone $3,750.02 $3,862.52 $3,978.40 $4,097.75 $4,220.69 $4,347.31 2007 $58.35Sundry $52,416.29 $53,988.78 $55,608.44 $57,276.69 $58,994.99 $60,764.84 2008 $60.10

2009 $61.90Total Revenue $1,643,057.28 $2,023,624.22 $2,217,546.61 $2,365,469.50 $2,523,625.51 $2,692,734.27 2010 $63.76



Yearly Food Cost Additions $72,000.00GROSS OPERATING INCOME $1,035,122.74 $1,319,028.78 $1,471,175.85 $1,591,476.44 $1,720,972.23 $1,860,343.34 Yearly Reduced Services Cost $10,000.00

UNDISTRIBUTED OPERAdmin & General $183,427.34 $188,930.16 $194,598.07 $200,436.01 $206,449.09 $212,642.56 Furniture $721,000.00Marketing & Sales (incl. Add cost) $153,694.89 $158,305.73 $163,054.91 $167,946.55 $172,984.95 $178,174.50 Complete Renovation $4,469,000.00Repair & Maintenance $170,498.78 $175,613.75 $180,882.16 $186,308.62 $191,897.88 $197,654.82 Discount Rate 13.00%Utilities $250,042.80 $257,544.08 $265,270.41 $273,228.52 $281,425.37 $289,868.14 Overall Cap Rate 9.50%Operating InterestManagement Fees $61,800.00 $63,654.00 $65,563.62 $67,530.53 $69,556.44 $71,643.14Franchise Fees $106,647.02 $109,846.43 $113,141.83 $116,536.08 $120,032.17 $123,633.13Depreciation (15 year/straight) $346,000.00 $346,000.00 $346,000.00 $346,000.00 $346,000.00


Income before Fixed $109,011.90 $19,134.61 $142,664.86 $233,490.12 $332,626.32 $440,727.06Insurance $24,250.32 $24,977.83 $25,727.16 $26,498.98 $27,293.95 $28,112.77TOTAL INCOME $84,761.58 -$5,843.22 $116,937.70 $206,991.14 $305,332.37 $412,614.29Taxes $57,612.43 $59,340.80 $61,121.03 $62,954.66 $64,843.30 $66,788.60Subtract: Capital Expenditures $5,190,000.00Add: Depreciation $346,000.00 $346,000.00 $346,000.00 $346,000.00 $346,000.00CASH FLOW -$5,162,850.86 $280,815.98 $401,816.67 $490,036.48 $586,489.07 $691,825.69DISCOUNTED CASH FLOW -$5,162,850.86 $248,509.72 $314,681.39 $339,619.86 $359,704.73 $375,495.27

NPV $427,741.88 $3,952,581.76Rate of Return -95%


Including $4M Sunk Cost

20

Projected Financials Complete Renovation Scenario 20% ROR2005 2006 2007 2008 2009 2010

Room Statistics Occupancy (Rooms Sold): Growth of Rooms Sold:

Rooms Available 67704 47904 47904 47904 47904 47904 2005 25728 12.6%(in addition to OSBI recommendations)

Rooms Sold 25728 34847 37367 38861 40416 42032 2006 34847Occupancy Rate 38.00% 72.74% 78.00% 81.12% 84.37% 87.74% 2007 37367Average Room Rate $55.00 $75.00 $78.28 $81.70 $85.28 $89.01 2008 38861

2009 40416REVENUE 2010 42032Room Revenue $1,415,040.00 $2,613,534.28 $2,925,082.02 $3,175,145.32 $3,446,586.37 $3,741,232.73 Average Room Rate:Food Revenue $81,185.42 $83,620.99 $86,129.62 $88,713.50 $91,374.91 $94,116.16 2005 $55.00 4.4% Growth of ADRBeverage $90,665.54 $93,385.51 $96,187.08 $99,072.69 $102,044.87 $105,106.21 2006 $75.00Telephone $3,750.02 $3,862.52 $3,978.40 $4,097.75 $4,220.69 $4,347.31 2007 $78.28Sundry $52,416.29 $53,988.78 $55,608.44 $57,276.69 $58,994.99 $60,764.84 2008 $81.70

2009 $85.28Total Revenue $1,643,057.28 $2,848,392.08 $3,166,985.56 $3,424,305.96 $3,703,221.83 $4,005,567.25 2010 $89.01



Yearly Food Cost Additions $72,000.00GROSS OPERATING INCOME $1,035,122.74 $2,093,253.96 $2,366,417.73 $2,593,947.94 $2,841,948.99 $3,112,211.98 Yearly Reduced Services Cost $10,000.00

UNDISTRIBUTED OPERAdmin & General $183,427.34 $188,930.16 $194,598.07 $200,436.01 $206,449.09 $212,642.56 Furniture $721,000.00Marketing & Sales (incl. Add cost) $153,694.89 $158,305.73 $163,054.91 $167,946.55 $172,984.95 $178,174.50 Complete Renovation $4,469,000.00Repair & Maintenance $170,498.78 $175,613.75 $180,882.16 $186,308.62 $191,897.88 $197,654.82 Discount Rate 13.00%Utilities $250,042.80 $257,544.08 $265,270.41 $273,228.52 $281,425.37 $289,868.14 Overall Cap Rate 9.50%Operating InterestManagement Fees $61,800.00 $63,654.00 $65,563.62 $67,530.53 $69,556.44 $71,643.14Franchise Fees $106,647.02 $109,846.43 $113,141.83 $116,536.08 $120,032.17 $123,633.13Depreciation (15 year/straight) $346,000.00 $346,000.00 $346,000.00 $346,000.00 $346,000.00


Income before Fixed $109,011.90 $793,359.80 $1,037,906.74 $1,235,961.62 $1,453,603.08 $1,692,595.70Insurance $24,250.32 $24,977.83 $25,727.16 $26,498.98 $27,293.95 $28,112.77TOTAL INCOME $84,761.58 $768,381.97 $1,012,179.57 $1,209,462.65 $1,426,309.13 $1,664,482.93Taxes $57,612.43 $59,340.80 $61,121.03 $62,954.66 $64,843.30 $66,788.60Subtract: Capital Expenditures $5,190,000.00Add: Depreciation $346,000.00 $346,000.00 $346,000.00 $346,000.00 $346,000.00CASH FLOW -$5,162,850.86 $1,055,041.16 $1,297,058.54 $1,492,507.99 $1,707,465.83 $1,943,694.33DISCOUNTED CASH FLOW -$5,162,850.86 $933,664.75 $1,015,787.10 $1,034,382.90 $1,047,220.77 $1,054,959.41

NPV $11,027,999.96 $11,104,835.90Rate of Return 20% Including $4M Sunk Cost


21

Opportunity description– Complete renovation of property to meet independent

living standards, including larger room sizes– Ability to provide proper meals for residents– Security provided for residents– Increased transportation to key locations in Bloomington

for residents– Organized activities for residents to participate in– Several other services made available to residents by

contract– Possible increase in number of staff required

Key Benefits1. Incredibly high revenue per square foot2. Increasing aging population likely to increase demand

for independent living3. High occupancy rates in other independent living

facilities4. Significant services need to be made available but most

can be done without extensive ongoing capital investments

5. Residents stay for long-term6. With the positive outlook for independent living market,

it may be attractive to potential buyers of the property

Potential Business Risks– If we build it, will they come?– Medical attention required for some residents, and

emergency situations may arise– Standards expected by residents may be very high

Key Investments (one-time and major ongoing)– Initial renovation of property to meet independent living

standards will be immensely costly– Providing meals for residents– Ongoing investment of running activities and providing

services and security for residents

Scenario 4: Alternative Use – Independent Living

22

Independent Living Customer Analysis

> $20,000 $20k - $35k $35k - $50k $50k - $75k $75k - $100k $100k - $125k $125k- $150k $150k- $200k > $200k

Households under 25 3274 1652 846 471 137 56 5 9 0

Households 25 to 34 1524 2215 2175 3226 1231 436 112 84 60

Households 35 to 44 1166 1739 2033 3513 2119 1224 539 331 210

Households 45 to 54 901 1277 1387 2525 1914 1231 573 560 348

Households 55 to 64 787 993 983 1507 614 535 295 172 272

Households 65 to 74 1113 1273 1007 732 379 172 64 61 95

Households 75 and over 1796 1103 738 519 229 84 101 26 39 Total

10561 10252 9169 12493 6623 3738 1689 1243 1024 56792

Subtotal 5283 3136 2022 1033 819 754 13047

Potential Customer Base 4749

McLean County

HOUSEHOLDS BY TYPE %

Total households 56,746 100

Family households (families) 35,470 62.5

With ow n children under 18 years 17,847 31.5

Married-couple family 28,911 50.9

With ow n children under 18 years 13,632 24

Female householder, no husband present 4,995 8.8

With ow n children under 18 years 3,324 5.9 36.4 % of single families

Nonfamily households 21,276 37.5

Householder living alone 15,668 27.6

Householder 65 years and over 4,615 8

23

Independent Living Market Analysis

Name of Organization Capacity (units) Room Types Occupation Price (per month)

Bickford House 60 Studio, 1 BR/2 BR 98%Studio: $1455; 1 BR: $1785; 2 BR: $2485

Heritage Manor - Adelaide Retirement Apartments

28Efficiency/Studio,

1 BR/2 BR50%

Efficiency/Studio:$987 1 BR: $1129 2 BR: $1292

Blair House Retirement Residence

Studio, 1 BR/2 BR 100% $1315 ~ $2700

Housing Authority of Bloomington - Woodhill Towers

303Efficiency/Studio,

1 BR100%

** Efficiency/Studio:$255 1 BR: $310-$350

Meadows Mennonite Retirement Community

26 1 BR/2 BR 92%** 1 BR: $465 2 BR: $575

Westminster Villege 233 Studio, 1 BR/2 BR 100%Studio:$1356 1 BR: $1531 2 BR: $2163

Darwin & Laurie Steidinger 9 1 BR 100% $1,800 Total 659

** The low prices are resulted from limited services provided by the facilitiesPotential Customers 4749

4090Market size

available to us

Our Independent Living Facilities Factors

731 BR (38) 2 BR (35)

95% (projection)**1 BR:$1800 2 BR:$2500

** Average monthly ratesProjected Annual Revenue 1,777,260.00

24

Cost Estimate

Room recap: 73 apartments, 1 hospitality rooms and 3 guest rooms

Total area of the rooms: North Wing 13,728 sq. ft.

East Wing (Exe) 18,408 sq. ft.

East Wing (Pool) 12,672 sq. ft

South Wing (Bus) 15,276 sq. ft.

Subtotal 60,084 sq. ft.

Estimated cost per sq. ft.: $ 80

Cost for room restructuring: $ 4.8 million

Total area from porches (North and East Wing): 3,000 sq. ft.

Estimated cost per sq. ft.: $ 110

Cost for re-doing porches: $ 330,000

Cost for 2 elevators: $ 200,000

Cost for roofing: $ 300,000

The estimated total cost for conversion: $ 5.63 million

(Cost for building associated facilities is not included)

25

Projected Financials Independent Living Scenario

2005 2006 2007 2008 2009 2010Room Statistics Occupancy Rate:Rooms Available - 73 73 73 73 73 2006 85.00%Rooms Sold - 62 66 69 69 69 2007 90.00%Occupancy Rate - 85.00% 90.00% 95.00% 95.00% 95.00% 2008 95.00%

2009 95.00%2010 95.00%

REVENUE $1,870,800.00 $1,870,800.00 $1,870,800.00 $1,870,800.00 $1,870,800.00Room Revenue - $1,590,180.00 $1,730,864.16 $1,827,023.28 $1,878,179.93 $1,930,768.97

Yearly Rev/Exp Growth rate:COST OF SALES 2006 2.80%Rooms - $11,481.73 $12,157.13 $12,832.52 $12,832.52 $12,832.52 2007 2.80%Food - $187,610.00 $192,863.08 $198,263.25 $203,814.62 $209,521.43 2008 2.80%

2009 2.80%TOTAL COST OF SALES - $199,091.73 $205,020.21 $211,095.77 $216,647.14 $222,353.95 2010 2.80%

Yearly Food Cost $182,500.00UNDISTRIBUTED OPER Remodeling East/South Wings $5,630,000.00Admin & General - $188,563.31 $193,843.08 $199,270.69 $204,850.27 $210,586.08 Discount Rate 10.00%Marketing & Sales - $25,412.16 $26,123.70 $26,855.16 $27,607.11 $28,380.11 Overall Cap Rate 7.25%Repair & Maintenance - $175,272.75 $180,180.39 $185,225.44 $190,411.75 $195,743.28Utilities - $257,044.00 $264,241.23 $271,639.98 $279,245.90 $287,064.79Operating Interest - 182500Management Fees - $63,530.40 $65,309.25 $67,137.91 $69,017.77 $70,950.27

TOTAL OPERATING EXPENSES - $908,914.35 $934,717.86 $961,224.96 $987,779.94 $1,015,078.47

Income before Fixed - $681,265.65 $796,146.30 $865,798.32 $890,399.99 $915,690.50Insurance - $24,929.33 $25,627.35 $26,344.92 $27,082.57 $27,840.89TOTAL INCOME - $656,336.32 $770,518.95 $839,453.41 $863,317.41 $887,849.61Taxes - $59,225.58 $60,883.90 $62,588.65 $64,341.13 $66,142.68Subtract: Capital Expenditures -$5,630,000.00CASH FLOW -$5,630,000.00 $597,110.74 $709,635.05 $776,864.76 $798,976.29 $821,706.93 ##DISCOUNTED CASH FLOW -$5,630,000.00 $542,827.95 $586,475.25 $583,669.99 $545,711.55 $7,547,668.52

NPV $4,176,353.26 ##Net Sales Price at 2010 $11,333,888.74Discounted Sales Price $7,037,453.19

Value of the Project $4,176,353.26 7,741,198.51 ##Value of the Project to Busey $176,353.26 ##

2%

Assumption: The cost of 3 meals per day per person is $5.00.

We use Discounted Cash Flow Method for the project

1 BR: $1800/month

2 BR: $2500/month

26

Projected Financials Independent Living Scenario 20% ROR

2005 2006 2007 2008 2009 2010Room Statistics Occupancy Rate:Rooms Available - 73 73 73 73 73 2006 85.00%Rooms Sold - 62 66 69 69 69 2007 90.00%Occupancy Rate - 85.00% 90.00% 95.00% 95.00% 95.00% 2008 95.00%

2009 95.00%2010 95.00%

REVENUE $2,350,800.00 $2,350,800.00 $2,350,800.00 $2,350,800.00 $2,350,800.00Room Revenue - $1,998,180.00 $2,174,960.16 $2,295,791.28 $2,360,073.44 $2,426,155.49

Yearly Rev/Exp Growth rate:COST OF SALES 2006 2.80%Rooms - $11,481.73 $12,157.13 $12,832.52 $12,832.52 $12,832.52 2007 2.80%Food - $187,610.00 $192,863.08 $198,263.25 $203,814.62 $209,521.43 2008 2.80%

2009 2.80%TOTAL COST OF SALES - $199,091.73 $205,020.21 $211,095.77 $216,647.14 $222,353.95 2010 2.80%

Yearly Food Cost $182,500.00UNDISTRIBUTED OPER Remodeling East/South Wings $5,630,000.00Admin & General - $188,563.31 $193,843.08 $199,270.69 $204,850.27 $210,586.08 Discount Rate 10.00%Marketing & Sales - $25,412.16 $26,123.70 $26,855.16 $27,607.11 $28,380.11 Overall Cap Rate 7.25%Repair & Maintenance - $175,272.75 $180,180.39 $185,225.44 $190,411.75 $195,743.28Utilities - $257,044.00 $264,241.23 $271,639.98 $279,245.90 $287,064.79Operating Interest - 182500Management Fees - $63,530.40 $65,309.25 $67,137.91 $69,017.77 $70,950.27

TOTAL OPERATING EXPENSES - $908,914.35 $934,717.86 $961,224.96 $987,779.94 $1,015,078.47

Income before Fixed - $1,089,265.65 $1,240,242.30 $1,334,566.32 $1,372,293.49 $1,411,077.02Insurance - $24,929.33 $25,627.35 $26,344.92 $27,082.57 $27,840.89TOTAL INCOME - $1,064,336.32 $1,214,614.95 $1,308,221.41 $1,345,210.92 $1,383,236.13Taxes - $59,225.58 $60,883.90 $62,588.65 $64,341.13 $66,142.68Subtract: Capital Expenditures -$5,630,000.00CASH FLOW -$5,630,000.00 $1,005,110.74 $1,153,731.05 $1,245,632.76 $1,280,869.79 $1,317,093.46 ###DISCOUNTED CASH FLOW -$5,630,000.00 $913,737.04 $953,496.74 $935,862.33 $874,851.30 $7,855,264.57

NPV $5,903,211.98 ###Net Sales Price at 2010 $18,166,806.29Discounted Sales Price $11,280,157.39

Value of the Project $5,903,211.98 ########### ###Value of the Project to Busey $1,903,211.98 ###

20%

We use Discounted Cash Flow Method for the projectWe use Discounted Cash Flow Method for the project

Assumption: The cost of 3 meals per day per person is $5.00.

We use Discounted Cash Flow Method for the project

To get 20% ROR scenario, we have to increase the price of the rooms to $2500/mo for 1 BR and $3100/mo for 2 BR.

27

Independent Living Details

• Market Insight: Based on the result of the national population census in 2000, the market size of independent living in Bloomington Area is estimated over 4,500 people. The total number of rooms available in major independent living houses are 659. For most of these houses, the occupancy rate is above 95%.

• Financial Takeaways: The initial estimated cost of conversion is $5.63 million. By selling the facility in 2010, the project would obtain a 2% rate of return on the total investment of $9.63 million ($5.63 million + $4 million). The analysis of the student team is on the conservative side based on the reference and estimated data.

RecommendationRecommendation

29

Financial Summary

Changes to get 20% ROR

NPVDiscounted Net

Sale Price @ 2010 ROR Occupancy ADRScenario 1: OSBI Changes $3,882,689.38 $3,213,754.49 -19.27% No increase

Increase ADR by $5 in 2005

Scenario 2: Unchanged $564,362.49 $338,656.27 -85.89%


9100 roomsIncrease ADR growth rate

additional 0.12%

Scenario 3: Complete Renovation $427,741.88 $3,952,581.76 -95.35%


3600 rooms

Increase ADR growth rate additional 1.4%; Increase

ADR $15 in 2006Scenario 4: Independent Living $4,176,353.26 $7,037,453.19 2.00%

85% in 2006, 90% in 2007, 95% thereafter

$2500/month for 1 BR; $3100/month for 2 BR

30

OSBI Hotel Recommendations Scenario Vs. Independent Living Scenario

• Advantages– Business know-how– Only one major change required– Established clientele– Already operating at near breakeven, if

Bloomington hospitality industry predictions pan out, property can easily become profitable

– Limited risk

• Disadvantages– Potential payoff limited (difficult to

increase occupancy by huge amount, and also difficult to raise ADR significantly without losing customers)

– Arena and conference center predictions may be overly optimistic

– Most increase in occupancy would have to come from continued stealing of market share from other hotels

• Advantages– Possibility of increasing the value of the

property drastically if everything is successful

– From the research, it appears that there the need for independent living facilities is present and will grow in the future

– Don’t have to worry about attracting customers on a daily basis

• Disadvantages– Very high initial capital expenditure, and

thus high risk– Lack of experience in running an

independent living facility– Additional services will need to be offered– Though the need is present, if not

designed and run well, potential customers, many of whom may be picky, may not wish to live here

OSBI Hotel Recommendations Independent Living

31

OSBI Recommendation

• As can be seen from financials and alternatives comparison, the unchanged and complete renovation scenarios are not viable options

• OSBI recommends that Busey follow the OSBI recommended changes for remaining as a hotel if Busey plans on continuing to operate the property

• However, in an effort to sell the Ramada Inn – Bloomington, IL property, OSBI recommends selling the independent living idea

First Busey CorporationFirst Busey CorporationRamada Inn – Bloomington, ILRamada Inn – Bloomington, IL

Questions?

AppendixAppendix

Independent Living Floor PlanIndependent Living Floor Plan

35

Lobby & Back Office

1 BR Units/Hospitality Suite1

BR

/2 B

R U

nits

1 B

R U

nits

1 BR/2 BR Units

Kitchen

Library&

Video RoomDiningRoom

Pool

Fun Room

Activity Area

Corrid

or

Corridors

Barber

ElevatorElevator

Nursing Room and Exercise Room

Entire Property Floor Plan

36

North Wing Room Configuration I (Ground Floor)

Pool

(Combined with

the fun room)

LoungeBackOffice

3 x 264’ = 792’ 4 x 264’ = 1,056’

22′

105

12′

109 107110111113115117119121123

104108 106110112114116118120122

101103

22’ x 12’ = 264’ 2 x 264’ = 528’

1 BR (big) – 792' (6)

2 BR – 1,056' (1)

Multi-function Rooms

37

North Wing Room Configuration I (Second Floor)

3 x 264’ = 792’ 4 x 264’ = 1,056’

12′

22′ x 12′ = 264’ 2 x 264’ = 528’

205209 207211213215217219221223225 20120322′

204 202208 206210212214216218220222224 200226228

1 BR (big) – 792' (6)

2 BR – 1,056' (2)

Pool

Boiler Rooms

38

North Wing Room Configuration II (Ground Floor with porch area included in rooms)

Pool

(Combined with

the fun room)

LoungeBackOffice

22′

105

12′

104

109 107110111113115117119121123

108 106110112114116118120122

101103

1 BR (big) – 912’ (3)

1 BR (small) – 852’ (3)

2 BR – 1,176' (2)

27’

Same for the Second floor

122

121

39

North Wing Room Configuration III (Ground Floor with porch area converted into balconies)

Pool

(Combined with

the fun room)

LoungeBackOffice

22′

105

12′

104

109 107110111113115117119121123

108 106110112114116118120122

101103

1 BR – 792' (6)

2 BR – 1,056' (2)

Same for the second floor

Balconies

40

(Porch area not included into rooms)

26′

18′ 253 255249 251247245243241239

26′

18′

12′

153 Ex Rm149 151147145143141139137135133

Pool

1 BR (big)- 744'/840' (8)

2 BR – 1056' (6)

East Wing Pool Side Rooms Configuration I

41

23’x12’=276’ 26’x12’= 312’

Same for the second floor

(Porch area included into rooms)

153 Ex Rm149 151147145143141139137135133

26’

18’+5’=23’

12’

Pool

1 BR (big)- 864'/900' (8)

2 BR – 1176' (6)

East Wing Pool Side Rooms Configuration II

42

153 Ex Rm149 15114714514314113913713513318’

26’

12’

(Porch area converted into balconies)

Pool

1 BR (big)- 744'/840' (8)

2 BR – 1056' (6)

Balconies

East Wing Pool Side Rooms Configuration III

43

26’

26’

12’12’x26’= 312' 312’x2 = 624’ 312’x3 = 936’

Ground Floor:

Second Floor: Same layout without the hospitality suite (6 small 1 BR and 6 2 BR)

Entrance and stair

1 BR (small)- 624' (6)

2 BR – 936' (5)

Hospitality Suite – 624’ (1)

Executive Wing (East)

44

306' x 2 = 612' 306' x3 = 918' 258' x 3 = 774'

Atrium & Pool

25.5'

21.5'

12'

En

tran

ce

South Wing Room Configuration Ground Floor

1 BR – 612’ (3)

Guest Rooms (3)Stairs

2 BR – 918’ (2)

1 BR – 774’ (4)

45

South Wing Room Configuration Second Floor

21.5'

25.5'

12' 306' x 2 = 612' 306' x3 = 918' 258' x 3 = 774'

1 BR – 612’ (3)

Stairs2 BR – 918’ (3)

1 BR – 774’ (5)

Atrium & Pool

46

Kitchen Area

Bathroom

Living Room

Bedroom

Tub

1 Bedroom (Big) Configuration (North and East Wing)

47

Kitchen Area

Bedroom

Living Room

Bathroom

1 Bedroom (Big) Configuration (North and East Wing)

48

44'

12'

Bathroom

Bedroom

Living Room

Kitchen

1 Bedroom (Small) Configuration (North & East Wing)

49

Kitchen Area

Living Room

Bedroom

Bathroom

26'

24'

1 Bedroom (Small) Configuration Executive and South Wing

50

Living Room

Bedroom Bedroom

KitchenBathroom Bathroom

2 Bedroom Configuration Executive and South Wing

51

Living Room

Bedroom Bedroom

Bathroom Bathroom

Kitchen

2 Bedroom Configuration (North & East Wings)

Hospitality Industry TrendsHospitality Industry Trends

53

Hospitality Industry Trends

• 34% increase in Internet reservations for major hotel brands from 2002 to 2003

• 1/2 of all respondents conduct online research before booking their business travel

– Up 55% from a year ago according to research from Yesawich, Pepperdine, Brown & Russell

• Comfortable bedding tops the list in terms of hotel amenities that matter most, surprisingly above high-speed Internet access and other seemingly important corporate amenities

• Stagnant corporate travel budgets

• Corporate travelers increasingly make decisions based on price and overall value

• Overall traveler spending by domestic and international visitors is forecasted to increase 4.4% in 2004 to $568 billion, up from $544 billion in 2003

– Forecast for 2005 is $594 billion (first time record set in 2000 will be surpassed)

54

Hotel Reservations

2003 CRO Hotel bookings

% of 2003 % of 2002 Change in volume

'03 v '02

3rd party Web sites 9 7 35%

Brand Web sites 18 14 33%

TOTAL INTERNET 27 21 34%

GDS travel agent 35 38 -2%

TOTAL ELECTRONIC 62 59 11%

Voice 38 41 -4%

TOTAL FOR CRO's 100% 100% 5%

Reservation Sources for Major Hotel Brands (2003)

Central Reservation Offices (CROs)

Source: TravelCLICK eTRAK Report 2003

Note: Brand Web sites were the source of 66% of the brands’ centrally booked Internet reservations

Key Takeaway: Internet reservations received at the central reservation offices (CROs) of the major hotel brands grew 34% in 2003 versus 2002

55

Corporate Travel Budgets

• 62% of 127 survey respondents plan no significant travel budget changes for 2004

• Remaining 38% plan changes of only -10% to +10%

• Top travel alternatives for those companies indicating a decrease in travel budget are telephone and videoconferencing, foregoing the trip, and Web meetings

• In 2004, one third are planning significant changes, the most popular including mandated and increased use of online booking tools, required use of preferred vendors and implementing online expense management tools

• Source: WorldTravel BTI's annual client survey (November 21, 2003)

56

Corporate Travel Budgets 2

• More than 70% of corporate travel managers report their budgets this year are flat or have been reduced

– National Business Travel Association surveys

• Many firms have opted to use low-cost carriers, and some are using online discounters Priceline.com and Hotels.com when affordable prices can't be found using traditional booking methods

• “There's a lot less discretionary business travel being done, and the business travel that is being purchased is being done on a tight budget.“

– Melissa Abernathy, spokeswoman for American Express Corporate Travel

• "The profile of the business traveler has forever changed.”– Kevin Iwamoto, president of the National Business Travel Association

• Source: The Dallas Morning News Knight Ridder/Tribune Business News– By Suzanne Marta, March 12, 2003

57

Corporate Travel

• Business travelers today show more similarities to leisure travelers, with purchase decisions being led by price and overall value

• The largest group of survey respondents (25%) said price was their main motivator when booking airfare and 53 percent also noted cost as the most important factor in their rental car decisions, even above overall convenience factors

• 1/2 of all respondents conduct online research before booking their business travel (up 55% from a year ago according to research from Yesawich, Pepperdine, Brown & Russell)

• When asked how often they extend their business travel for leisure purposes, 70% said they did not extend any trips in the past year (meaning almost 1/3 people did extend their trips)

• The largest group of respondents, 43.6%, spends only one to two nights at most away from home on a business trip

• Comfortable bedding tops the list in terms of hotel amenities that matter most, surprisingly above high-speed Internet access and other seemingly important corporate amenities

• The importance of loyalty programs scored average to low in the air, hotel and car categories

• In terms of hotel chains, Marriott (28.1%) and Hilton (9.6%) are the most frequently used

• Source: Travelocity Business Survey

58

All Travel (Business and Leisure)

• Overall traveler spending by domestic and international visitors is forecasted to increase 4.4% in 2004 to $568 billion, up from $544 billion in 2003– Forecast for 2005 is $594 billion (first time record set in 2000 will be

surpassed)

• U.S. residents are forecasted to take more than 122 million business trips in 2004, an improvement of 4.2% from 2003

• Forecast leisure travel volume to grow 3.2% in 2004, up from a predicted 2.8% annual increase this year– It is forecast to increase once again in 2005 by nearly 2%

• Source: Travel Industry Association of America’s (TIA)– October 22, 2003

Projected Financials DetailsProjected Financials Details

60

Projected Financials OSBI Recommendation Scenario Details

• Rooms Available: 62,000 Rooms per year (174 rooms total) after turning the South Wing (Bottom Floor) into 2 BR Suites

• Rooms Sold: – for 2005, Rooms Sold increases 4.5% from 2004– for 2006, Rooms Sold increases by Increase percentage plus additional 4200 rooms from completion of

downtown Bloomington Arena – for 2007, Rooms Sold increases by Increase Percentage plus additional 1000 rooms from completion of

downtown Normal Conference Center– from 2008-2010, Rooms Sold will increase by Increase Percentage

• Even though forecasts for both business and leisure travel vary among sources, optimism prevails. According to Travel Industry Association of America (TIA), domestic business trips are expected to increase 4.2% in 2004 and 3.5% in 2005. These increases mark TIA’s first positive expectations since 1999. “Business travel has picked up in terms of frequency and budget numbers for a lot of companies,” attests a participant. In terms of domestic leisure travel, TIA forecasts an increase of 3.2% in 2004 and a rise of nearly 2.0% in 2005. Korpacz Real Estate Investor Survey, First Quarter 2004

• Using this information, I guesstimated an Increase Rooms Sold percentage of 4%

61


• Average Daily Rate:– for 2005, I used the ADR of $55, then increased each year by the Yearly Growth ADR– increase ADR of 2.6% each year using the information below and Table 1

• ADR growth for the industry is expected to accelerate to 3.0% in 2005. (Korpacz Real Estate Investor Survey, First Quarter 2004)

• Room Revenue: Multiply the Rooms Sold by ADR for each year

• Yearly Rev/Exp Growth rate: Use the Operating Expense change rate from Table 1

• Food, Beverage, Telephone, Sundry Revenues: Using the current Income Statement, find the monthly revenue for each, then multiply by 12, finally increase by Yearly Rev/Exp rate for each respective year

• Rooms Cost of Sales: Using the current Income Statement, the cost of each Room Sold is roughly $15, increased by the Yearly Rev/Exp rate for each respective year

• Food Cost:– Using the current Income Statement, find the monthly cost for food and increase each year by the respective Yearly Rev/Exp rate– In 2005, add the Additional Food Cost for evening food offerings

• Beverage, Telephone Costs: Using the current Income Statement, find the monthly expense for each, then multiply by 12, finally increase by Yearly Rev/Exp rate for that respective year

62


• Admin & General, Repair & Maintenance, Utilities, Management Fees, Franchise Fees: Using the current Income Statement, find the monthly expense for each, then multiply by 12, finally increase by Yearly Rev/Exp rate for each respective year

• Marketing & Sales Cost:– Using the current Income Statement, find the monthly cost for marketing/sales and increase each year by the

respective Yearly Rev/Exp rate– In 2005, add the Reduced Services Cost for special offerings at local Bloomington/Normal businesses

• Depreciation: Yearly depreciation expense using 15-year/straight line for Capital Expenditures

• Insurance, Taxes: Using the current Income Statement, find the monthly cost for each, then multiply by 12, finally increase by Yearly Rev/Exp rate for each respective year

• Furniture Cost: $7,000 per room multiplied by 24 rooms = $168,000

• Discounted Cash Flow: Discount each year’s cash flow using the Discount Rate within the range of Table 1

• Value of Hotel: Take the Discounted Cash flow for 2010 and divide by the Overall Cap Rate within the range of Table 1

63

Table 1

Korpacz Real Estate Investor Survey, First

Quarter 2004

64

Projected Financials Unchanged Scenario Details

• Room Available: Remains constant at 182 rooms

• Rooms Sold: Increases by 2% each year

• Looking ahead to 2004, the largest occupancy gain is expected in the upscale chain segment (+2.9 percentage points), according to PwC. By comparison, the smallest gain is forecast in the mid=scale-with-food-and-beverage chain segment (+1.0 percentage point). Korpacz Real Estate Investor Survey, First Quarter 2004

• Average Daily Rate:– For 2005, I used the ADR of $55, then increased each year by the Year Growth ADR– Increase ADR of 1.25% each year using the information below and Table 4




65

Projected Financials Unchanged Scenario Details

• Food Cost: Using the current Income Statement, find the monthly cost for food and increase each year by the respective Yearly Rev/Exp rate

• Admin & General, Marketing & Sales, Repair & Maintenance, Utilities, Management Fees, Franchise Fees: Using the current Income Statement, find the monthly expense for each, then multiply by 12, finally increase by Yearly Rev/Exp rate for each respective year




66

Table 2


Quarter 2004

67

Projected Financials Complete Renovation Scenario Details

• Rooms Available decreases due to demolition of South Wing (55 Rooms Total)

• Increase in occupancy due to Bloomington Arena:– out of 21,000 people for business, get 1000 to stay for 2 nights– out of 42,000 people for sports, get 2000 to stay 1 night– out of 4,000 people for leisure, get 200 to stay 1 night– Total additional increase of rooms sold in 2005, 2100 people…for 2006 on, get 4200

people– TOTAL: 4200 rooms sold annually

• Increase in occupancy due to Normal Conference Center starting 2007: 500 people for 2 nights; TOTAL: 1000 rooms sold

• Depreciate Capital Expenditures over 15 years

68


• Rooms Available: Rooms Available decreases due to demolition of South Wing (55 Rooms Total demolished)

• Rooms Sold: – For 2005, Rooms Sold increases 4.5% from 2004– For 2006, Rooms Sold increases by Increase percentage plus additional 4200 rooms from completion of

downtown Bloomington Arena – For 2007, Rooms Sold increases by Increase Percentage plus additional 1000 rooms from completion of

downtown Normal Conference Center– From 2008-2010, Rooms Sold will increase by Increase Percentage– All Rooms Sold increase 2% in addition to OSBI Recommendations due to hotel becoming more of a luxury

hotel

• Average Daily Rate:– For 2005, I used the ADR of $55, then increased each year by the Year Growth ADR– Increase ADR of 3% each year using the information below and Table 3




69


• Food Cost:– Using the current Income Statement, find the monthly cost for food and increase each year by the

respective Yearly Rev/Exp rate– In 2005, add the Additional Food Cost for evening food offerings

• Beverage, Telephone Costs: Using the current Income Statement, find the monthly expense for each, then multiply by 12, finally increase by Yearly Rev/Exp rate for that respective year

• Admin & General, Repair & Maintenance, Utilities, Management Fees, Franchise Fees: Using the current Income Statement, find the monthly expense for each, then multiply by 12, finally increase by Yearly Rev/Exp rate for each respective year

• Marketing & Sales Cost:– Using the current Income Statement, find the monthly cost for marketing/sales and increase each year

by the respective Yearly Rev/Exp rate– In 2005, add the Reduced Services Cost for special offerings at local Bloomington/Normal businesses


• Furniture Cost: $7,000 per room multiplied by 103 rooms = $721,000



70

Table 3


Quarter 2004

71

Projected Financials Independent Living Scenario Details

• Rooms Available: 73 units available

• Rooms Sold: – Rooms Available x Occupancy Rate– Starting 2006, increase Rooms Sold by Yearly Growth Rate

• Occupancy Rate: Use 85% initially (data gathered from researching Bloomington/Normal market)

• Average Daily Rent: 1BR $1,800/month; 2BR $2,500/month– Increase Daily Rent of 2.8% each year using the information below and Table 2



72

Projected Financials Independent Living Scenario Details

• Food Cost: Add the Additional Food Cost for evening food offerings, then increase each year by the respective Yearly Rev/Exp Growth rate

• Admin & General, Marketing & Sales, Repair & Maintenance, Utilities, Management Fees, Franchise Fees: Using the current Income Statement, find the monthly expense for each, then multiply by 12, finally increase by Yearly Rev/Exp rate for each respective year

• Depreciation: Yearly depreciation expense using 15-year/straight line for Capital Expenditures




73

Table 4


Quarter 2004

Independent Living FacilitiesIndependent Living Facilities

75

Independent Living Analysis

• Based on research, the pricing of independent living facilities can be categorized into two groups

– Low price group monthly rates range from $255~ $575

– High end group monthly rates range from $987~ $2700

• The difference on prices results from room conditions and basic services provided

• Based on the room conditions of Ramada Inn, as well as the existing facilities, the independent living project should fall into the high price group

– The price of different types of rooms should range between $1,000 and $2200– Basic service should be provided, such as meals (3 meals per day), laundry,

security, housekeeping, and social activities – Some basic medical services should also be considered, such as medication

reminder, ADL assistance and emergency response.

76

Independent Living Services Comparison (Provided by Facility and Contract)

SERVICE: Bickford Westminster ?? Heritage Woodhill Towers Meadows Mennonite

Meals (3 per day) X X X X

Housekeeping X X X X X

Laundry X X X X X

Security X X X X X X

Transportation X X X X

Activities X X X X X

Maintenance X X X X X X

Social Services X X X X

Care Management X

ADL Assistance X X

Emergency Response X X X X X

On-Call Nursing X X X X

Medication Reminders X X

Supervision of Self-Administered Meds

X

Medication Administration

X

77

Income by Age (McLean County)


0

500

1000

1500

2000

2500

3000

> $20,000 $20,000 - $35,000 - $50,000 - $75,000 - $100,000 $125,000 $150,000 >

Income Range

Nu

mb

er

of

Ho

us

eh

old

s

Households45 to 54

Households55 to 64

Households65 to 74

Households75 and over

78


> $20,000 $20k-$35k$35k-$50k

$50k - $75k

$75k - $100k

$100k - $125k

$125k- $150k

$150k- $200k

> $200k

Households under 25 3274 1652 846 471 137 56 5 9 0

Households 25 to 34 1524 2215 2175 3226 1231 436 112 84 60

Households 35 to 44 1166 1739 2033 3513 2119 1224 539 331 210

Households 45 to 54 901 1277 1387 2525 1914 1231 573 560 348

Households 55 to 64 787 993 983 1507 614 535 295 172 272

Households 65 to 74 1113 1273 1007 732 379 172 64 61 95

Households 75 and over 1796 1103 738 519 229 84 101 26 39 Total

10561 10252 9169 12493 6623 3738 1689 1243 1024 56792

Subtotal 5283 3136 2022 1033 819 754 13047

79

Households by Type (McLean County)

McLean County

HOUSEHOLDS BY TYPE %

Total households 56,746 100

36.4 % of single families

Family households (families) 35,470 62.5

With own children under 18 years 17,847 31.5 Potential Customer Base 4749

Married-couple family 28,911 50.9

With own children under 18 years 13,632 24 Total Number of Beds 750

Female householder, no husband present 4,995 8.8 (plus 1 facility unknown)

With own children under 18 years 3,324 5.9 Number High End Beds 350

Nonfamily households 21,276 37.5 (plus 1 facility unknown)

Householder living alone 15,668 27.6 Number Low End Beds 400

Householder 65 years and over 4,615 8

High End Independent Living High End Independent Living FacilitiesFacilities

81

Bickford House

- Studio (4): $1455, 1 BR (46): $1785, 2 BR (10): $2485

- Provide basic services such as: meals, housekeeping, laundry, transportation, maintenance, security, etc. Medical services include emergency response, medication reminder and ADL assistance

- Occupancy rate: 98% full

- Typical clients: middle class people paying by themselves, no government aid

82

Bickford House (Services)

SERVICE:Provided by Facility:

Provided by Contract: Included in Rent: Additional:

Meals (3 per day) X X

Housekeeping X X

Laundry X X

Security X X

Transportation X X

Activities X X

Maintenance X X

Social Services X X

Care Management X X

ADL Assistance X X

Emergency Response X X

On-Call Nursing X X



X X

Medication Administration X X

83

Bickford House (Details)

Owner's Name: Eby Development and ManagementStreet Address: 14 Heartland Drive, Bloomington, IL 61704Owner Mailing Address: 706 N. Lindenwood, Olathe, KS 66062Contact Name: Shelley HuntTelephone: 309-661-0094Type of Business: For-profit corporation

# of Units: Studio: 4; 1 Bedroom: 46; 2 Bedrooms: 10# of Floors: 3 Elevators: Yes Handicapped Accessible: YesStaffing: Full-time # of Hours Available: 24 hrs

Residency Requirements: N/AAssessment upon Admission: Yes Conducted by: DirectorReassessment: YesCost/Monthly Base Rate (Average monthly rent based on income)Studio: $1455; 1 Bedroom: $1785; 2 Bedroom: $2485Signed Lease: NoAdditional Cost for Roommate: Yes For Spouse: YesPayment Options: MonthlyDown Payment: No Security Deposit: No

84

Westminster Village, Inc.

- Westview wing: efficiencies, 1 BR, 2 BR. (233 in total)

- Willows Duplexes: individual duplexes that provide independence combined, with the safety and security of community living. (22 in total)

- Rates: to be confirmed

- Occupancy rate: to be confirmed

85

Westminster Village, Inc. (Services)

SERVICE: Provided by Facility:Provided by Contract:

Included in Rent: Additional:

Meals X X X (extra meals and

duplexes)

Housekeeping X X X (duplexes)

Laundry (linens) X X X (duplexes)

Security X X X

Transportation X X

Activities X X

Maintenance X X X

Social Services X X

Care Management

ADL Assistance X X


On-Call Nursing X X

Medication Reminders



Other services provided include: library, religious activities, banking, store, physical therapy, emergency call system

Services in independent living are priced ala carte.

86

Westminster Village, Inc. (Details)

Owner's Name: Westminster Village, Inc.Street Address: 2025 E. Lincoln St., Bloomington, IL 61701Mailing Address: sameContact Name: Jean A. Daily, Marketing Director; Mark Houren, Administrator; Rhonda Polzin, Director of Nursing; Tony Patton, Maintenance Director; Art Keene, Food Services DirectorE-Mail: [email protected] Web Address: http://www.westminstervillageinc.comTelephone: 309-663-6474Type of Business: Private Not-for-profitType of Housing: Independent Living, Independent Duplexes, Continuing Care

# Units: Apartments 233, Private Homes 22# of Floors: 3 Elevators: Yes Handicapped Accessible: YesStaffing: Full-time # of Hours Available: 24 hoursResidency Requirements:Minimum Age: 62 ADL Limitations: as long as the resident is not a threat to their own or others safety, health and well beingMental Illness/D.D.: same as aboveDementia: same as aboveTerminal Illness/Hospice: same as aboveOther: skilled nursing care provided in 78 bed healthcare centerAssessment upon Admission: Yes Conducted by: PhysicianReassessment: NoCost/Monthly Base Rate (based on one occupant) Please call for ratesSigned Lease: YesAdditional Cost for Roommate: Yes For Spouse: YesPayment Options: Monthly, also option to buySecurity Deposit: Yes

87

??

SERVICE: Provided by Facility: Provided by Contract: Included in Rent: Additional:


Housekeeping X X

Laundry X X

Security X X

Transportation X X

Activities

Maintenance X X

Social Services X X

Care Management

ADL Assistance


On-Call Nursing X X




Beauty Salon X X

88

??

Owner's Name: Darwin & Laurie SteidingerStreet Address: 2218 Lincoln St., Bloomington, IL 61701Contact Name: Darwin & Laurie SteidingerTelephone: 309-662-5900Type of Business: Room and Board - Shared HousingType of Housing: Shared Housing, Licensed Healthcare Facility

# of Units: 1 Bedroom: 9# of Floors: 2 Elevators: Yes Handicapped Accessible: YesStaffing: Full-time # of Hours Available: 24 hoursResidency Requirements:Minimum Age: noneADL Limitations: ability to live independently, contract home healthMental Illness/D.D.: no admittanceDementia: no admittance of persons in the late stages of diseaseTerminal Illness/Hospice: no admittanceOther: no admittanceAssessment upon Admission: YesConducted by: PhysicianReassessment: YesCost/Monthly Base Rate: 1 Bedroom: $1800Signed Lease: NoAdditional Cost for Roommate: Yes For Spouse: YesPayment Options: MonthlyDown Payment: No Security Deposit: No

89

Heritage Manor - Adelaide Retirement Apartments

- Efficiency (4): $987, Studio (4): $987, 1 BR (16): $1129, 2 BR (4): $1292

- Provide basic services such as: meals, housekeeping, laundry, maintenance, security, etc. Medical services include emergency response and on-call nursing.

- Occupancy rate: about 50% full

- Typical clients: middle class people paying by themselves, no government aid

90

Heritage Manor - Adelaide Retirement Apartments (Services)



Housekeeping X X

Laundry X X

Security X X

Transportation

Activities X X

Maintenance X X

Social Services

Care Management

ADL Assistance


On-Call Nursing X X




91

Heritage Manor - Adelaide Retirement Apartments (Details)

Owner's Name: Heritage EnterprisesStreet Address: 509 N. Adelaide, Normal, IL 61761Contact Name: Louise Crumpler, Apartment CoordinatorTelephone: 309-452-0743 Type of Business: For-profitType of Housing: Independent Living, Licensed Healthcare Facility, Dementia Care Unit

# of Units: Efficiency: 4; Studio: 4; 1 Bedroom: 16; 2 Bedrooms: 4# of Floors: 3 Elevators: Yes Handicapped Accessible: YesStaffing: Full-time # of Hours Available: 24 hoursResidency Requirements:Minimum Age: 55ADL Limitations: able to live independently, contract with home healthMental Illness/D.D.: N/ADementia: separate Alzheimer's unit on groundsTerminal Illness/Hospice: accepted for residencyOther: separate healthcare facility for skilled nursing on groundsAssessment upon Admission: Yes Conducted by: Administrator or NurseReassessment: NoCost/Monthly Base RateEfficiency: $987; Studio: $987; 1 Bedroom: $1129; 2 Bedrooms: $1292Signed Lease: YesAdditional Cost for Roommate: Yes For Spouse: YesPayment Options: Monthly Security Deposit: Yes

92

Blair House Retirement Residence

- Room types: studio, 1 BR, 2 BR

- Rates: between $1315 - $2700, based on individual contract

- Provide both independent and assisted living

- Occupancy rate: 100%

- Owner's Name: please contact facility for more informationStreet Address: 1200 East College Avenue, Normal, IL 61761Contact Name: Glen HastyTelephone: 309-454-8900

Low End Independent Living Low End Independent Living FacilitiesFacilities

94

Housing Authority of Bloomington - Woodhill Towers

- Rent is based off 30% of person’s gross income

- Maximum rent is $255/month for efficiency; $310-$350/month maximum rent for 1 BR

- Efficiencies / 1 BR (kitchen, bathroom, like an apartment)

- A meal service is offered on a “pay as you go” plan, offered M-F

- No medical services offered

- Typical client is from lower income, on Social Security, single (widowed spouse that can’t take care of the home or afford it anymore)

- Does offer some services free of charge (van rides to go shopping, BINGO nights, etc.)

- Has a Service Coordinator that will help setup services (ie. housecleaning) for a small fee

- Occupancy unknown; supposedly “high”, but units are usually available

95

Housing Authority of Bloomington - Woodhill Towers (Services)

SERVICE:Provided by Facility:

Provided by Contract: Included in Rent: Additional:

Meals (3 per day)

Housekeeping X X

Laundry X X

Security X X

Transportation X X

Activities X X

Maintenance X X

Social Services X X

Care Management X X

ADL Assistance

Emergency Response

On-Call Nursing




96

Housing Authority of Bloomington - Woodhill Towers (Details)

Owner's Name: Housing Authority of BloomingtonStreet Address: 104 E. Wood St., Bloomington, IL 61701Contact Name: Kim Holman-short, Executive DirectorTelephone: 309-829-3360 E-Mail: [email protected] Type of Business: Government

# of Units: Studio: 207; 1 Bedroom: 96# of Floors: 12 Elevators: Yes Handicapped Accessible: YesStaffing: Part-time # of Hours Available: 40 hours/weekResidency Requirements:Minimum Age: 55ADL Limitations: if assistance is needed, services may be contractedMental Illness/D.D.: accepted if services are utilizedDementia: only mild cases are acceptedTerminal Illness/Hospice: acceptedOther: residency not usually possibleAssessment upon Admission: No Conducted by: social service home visitReassessment: NoCost/Monthly Base Rate: All rent based on incomeSigned Lease: YesAdditional Cost for Roommate: N/A For Spouse: NoPayment Options: MonthlyDown Payment: No Security Deposit: $100

mailto:%[email protected]

97

Meadows Mennonite Retirement Community

- 1 BR: $250 + $215 service fee = $465/month; 2 BR: $365 + $215 service fee = $575/month

- Bedroom dimensions are: 12x12; 13x11

- Service fee includes maintenance, landscape upkeep, cable TV, and social/recreational activities

- Rooms are set up like duplexes (bedroom, kitchen, living room) and look like apartments

- No utilities offered in rent; no food service plan; no housekeeping

- Has a central recreation room / activity center

- Has overnight guest room

- No insurance plans, but do have an emergency call system and do keep medical records on file

- Occupancy: 26 total units with only 2 available

98

Meadows Mennonite Retirement Community (Services)


Meals (up to 3 per day) X

Housekeeping

Laundry

Security X

Transportation X

Activities X

Maintenance X

Social Services X

Care Management X

ADL Assistance X

Emergency Response X

On-Call Nursing X

Medication Reminders X


X

Medication Administration X

99

Meadows Mennonite Retirement Community (Details)

Street Address: RR Box 310, Chenoa, IL 61726Contact Name: Bob BertscheTelephone: 309-747-2702Type of Housing: Independent Living, Licensed Healthcare Facility, Dementia Care Unit

# of Units: 1 Bedroom; 4: 2 Bedroom; 38# of Floors: 2 Elevators: Yes Handicapped Accessible: YesStaffing: Part-time (independent living)Residency Requirements:Minimum Age: 60ADL Limitations: may hire help to come in and assist with ADLsMental Illness/D.D.: persons with diagnosed mental illness not admittedDementia: spouse provides care of dementia resident until dementia resident is a risk to neighbors or propertyTerminal Illness/Hospice: yes, if caregiver support is available in housing, nursing home cooperates with several hospice programsOther: nursing home has shelter, intermediate and skilled care levelsAssessment upon Admission: YesReassessment: on going monitoringCost/Monthly Base Rate: costs change annuallySigned Lease: Yes, life leaseAdditional Cost for Spouse: NoPayment Options: Monthly, also option to buy

OSBI Recommendations for OSBI Recommendations for Remaining as HotelRemaining as Hotel

Details

101

Convert atrium into dining area / coffeehouse

Offer more competitive internet rates -loyalty programs are low on priority

Install Wi-Fi in atrium / lobby area

Comfortable Bedding

Set up business center at corner of front desk

Dining area is limited; only Continental Breakfast is served; Atrium is

Ramada is $10 - $15 overpriced compared to similar hotel internet rates; business traveler has value-driven mentality

Only select rooms in East Wing have access to high speed internet

Bedding most important amenity for business traveler

Empty room in North Wing will serve as business center in future

Convert atrium to coffeehouse style; move big screen TV and dining room chairs/tables into atrium; serve breakfast / dinner in the atrium; make the current dining area / lobby into quiet “library” setting

Advertise Ramada prices to be more in-line with hotels of the same quality rating

Offer free wireless “hotspots” in dining area / atrium; advertise Wi-Fi as an attraction for business clients

Purchase Order to buy better beds

Locate business center at unused area of front desk. Enable network printing from laptops, rooms (PrintMe Networks)

Solution Attribute Current State Future State

Scenario 1: OSBI Consulting Recommended Changes (if remaining as hotel)

102

Convert east wing courtyard rooms into efficiencies

Offer free/reduced costs for business traveler to explore area

Convert south wing rooms into business suites

Make finger food available for guest purchase late at night (or at all times during the day)

East Wing is in bad shape; rooms are inhabitable and used for storage

These rooms are not in the best of shape; are only used when occupancy at hotel is high

Offer only continental breakfast

Convert backside rooms on first and second floor into studio style apartments; only offer basic amenities for long-term stay customers; market to ISU students that would not enter in short-term lease / sublet agreement;

Convert south wing into approximately 12 suites

Serve light food after work-hours for business travelers

Solution Attribute Current State Future State

Scenario 1: OSBI Consulting Recommended Changes (if remaining as hotel)

103

Atrium & Pool

25.5”

21.5”

12”306” x3 = 918”

2 BR Suites (8)

Guest Rooms (3)

En

tran

ce

Stairs

258” x 3 = 774”

South Wing Suite Configuration Ground Floor

104

Unchanged BR25.5”

or 21.5”

Common Living Unchanged BR

36”

12”

Bottom Floor 1 Suite (South Wing)

105

Kitchen Area

Living Room

Bedroom

Bathroom

25.5” or

21.5”

36”

Counter

Fridge/S

toveC

ouch

Entertainm

ent

Table

Bedroom

Bathroom

Suite Configuration / South Wing

Additional InformationAdditional Information

107

Conference Center and Marriott Hotel

Contact: Wayne Aldrich

Position: Normal Downtown Development Director

Location: Downtown Normal, IL

Details:

- Hotel and conference center are separate, but hotel will not be built unless accompanied by conference center

- Using the pre-9/11 HVS study for the demand of luxury hotel; he didn’t give the impression that there has been a lot of research for building new hotel/conference center—he even acknowledged HVS report was outdated

- He feels additional business can be brought in through new conference center

- Construction should begin early July 2005 and open January 2007

first busey corporation ramada inn – bloomington, il

Documents

ramada inn bloomington

conference room

room revenue

exercise room

gaming room

average room rate

poor room conditionfurniture

existing rooms