Editor: My name is Bill Eckenrode and since 2005 my wife and I have been spending six months each year at our condominium located at 6 Belleview Blvd. My business career now spans 55 years, mostly in financial responsibilities. Among other positions, I have been chief financial officer for two industrial corporations, have spent 25 years on the board of a real estate investment company and for the past 12 years have served as an adviser to an investment fund. Because of my background I was asked to review the market and financial analysis compiled by PKF Consulting and to opine on the validity of the redevelopment strategy outlined in the report.
Although the real estate investment company I served as board member did acquire three hotels, I do not consider myself to be an expert in hotel investment or management. Therefore, I checked the capabilities of PKF Consulting to see if I could rely on their real estate data, assumptions and recommendations. I determined that they are recognized as a leader in their field, maintaining valuable hotel industry data bases. They are international in scope and have been analyzing the hotel industry for many years.
Then I reviewed PKF’s assumptions and projections of the economic climate in which the Belleview Biltmore would have to operate.
Generally I found these economic assumptions to be reasonable, tending to conservative, tempered by the recent years of slow economic growth.
After reviewing the underlying assumptions, I studied in depth Section VII: Estimated Utilization and Financial Analysis. My key impressions are:
1.) The development of the projected Belleview Biltmore Revenues utilized a number of logical calculations, incorporating both economic and Florida hotel data, arriving at understandable numbers.
2.) The estimates of financial performance are based upon the actual 2011 financial performance of five comparably sized and operated full-service Florida based resorts, which adds credibility to the projections.
3.) The analysis assumes that the Belleview Biltmore will not achieve its stabilized occupancy rate until the third year of operation, which seems realistic.
4.) Recognizing that Belleview Biltmore golf and beach amenities are not adjacent to the hotel, the Analysis lowered its market penetration percentage, thus lowering the occupancy rate used. Because of this and the hotel’s location, the Analysis used a lower Average Daily Rate, more similar to The Renaissance Vinoy and the Loews Don CeSar room rates, which is more reasonable.
In my opinion, the PFK Market and Financial Analysis is a professional and well developed projection of the financial results a restored Belleview Biltmore Hotel can be expected to produce, providing the sound redevelopment strategy set forth in the report is followed.