Avid Hotel Dallas & McKinney in McKinney, TX Listed for Sale

HVS, as the sole and exclusive advisory firm to ownership, presents the opportunity to acquire the 95-key avid Hotel Dallas-McKinney, an under-construction, limited-service hotel asset in the historically strong city of McKinney, located 30 miles north of Downtown Dallas. 

The hotel is expected to open in December 2024 and will be delivered to new ownership turn-key or upon issuance of the Certificate of Occupancy (CO). An investor will have the opportunity to acquire a newly constructed hotel, offering a blank slate to implement its own sales and revenue-management strategies.

Newly Constructed, High-Quality, Limited-Service Hotel Asset

• With a scheduled opening date of December 2024, the property will be in excellent physical condition, thus allowing an investor to acquire an IHG-branded, turn-key asset without concerns of a change-of-ownership property improvement plan (PIP).

• The average age of the selected competitive set is over eleven years old, with the most recent hotel having opened in 2022.

• As the newest lodging facility in the competitive submarket, the property will be superior to what is currently available, and the hotel will be well suited to achieve its competitive market positioning and capture high-rated transient and commercial demand.

• The avid Hotel brand offers an efficient labor model and straightforward operation process, ultimately leading to a better NOI flow-through than similar limited-service hotels in other brand families.

Strong Dallas Submarket Fundamentals and Increasing Performance of Competitive Set

• Per the STR Trend Report, the competitive set, consisting of seven midscale to upper-midscale, limited-service hotel assets, achieved occupancy and average daily rate (ADR) levels of 73.7% and $108.44, respectively, resulting in an average $80.22 RevPAR index for the trailing-twelve-month (TTM) period ending June 2024.

• For the year-to-date (YTD) period ending June 2024, the competitive set achieved a 4.3% RevPAR increase, driven primarily by ADR growth.

• Per the eight-year historical trend and YTD June 2024 data, demand has grown at a notable rate, with an average of 161,300 (rounded) room nights sold in the YTD period, equating to a compounded annual growth rate (CAGR) of 9.2% since 2017.

• Based on HVS pro-forma projections, the hotel’s stabilized rooms revenue is anticipated to exceed $3,000,000, with an NOI flow-through over $1,000,000 (rounded), resulting in a RevPAR level above $90.

Excellent Location Along U.S. Highway 75 Among Strong Corporate & Leisure Demand Generators

• The property benefits from excellent visibility and accessibility given its location just off U.S. Highway 75.

• The Dallas/Fort Worth Metroplex is home to numerous Fortune 500 company headquarters including ExxonMobil, J.C. Penney, and American Airlines, among others. The Metroplex is considered an “inland port” due to its favorable transportation infrastructure, which includes a massive interstate and highway system, rail lines, and two of the busiest airports in the country—Dallas Fort Worth International Airport and Dallas Love Field.

• McKinney is home to many large corporations including Raytheon, Aramark, Encore Wire, Global Life Inc., Wistron GreenTech, Emerson Process Management, Simpson Strong-Tie, Tenant Tracker, Manner Polymers, Traxxas, and Brandon Industries. McKinney has led the way in sustainable developments, and its historic business district is one of the largest and most successful in the state.

• Leisure demand generators nearby include District 121, Hub 121, Credit Union of Texas Event Center, Collin College, Craig Ranch, Medical City McKinney, and McKinney ISD Stadium. Moreover, the $220-million Sunset Amphitheater is expected to host over 50 events annually following its opening in 2026.

• The property is also located five miles from Allen Premium Outlets, which includes retailers such as Adidas, Ann Taylor, Banana Republic, Coach, Gap Outlet, Kenneth Cole, Last Call by Neiman Marcus, Michael Kors, Polo Ralph Lauren, and Tommy Hilfiger.

• As part of the Dallas/Fort Worth Metroplex, McKinney benefits from the many major sporting, cultural, and entertainment venues in the greater Dallas area.

Highly Coveted and Expanding Dallas/Fort Worth Metroplex

• The Dallas/Fort Worth Metroplex continues to attract Fortune 1000 and Global 500 headquarters through the growth and expansion of local companies; it is consistently recognized as one of the top markets in the nation for new and expanded corporate facilities, including the relocations of office headquarters from AT&T, Comerica, Fluor, and Toyota. More recent relocations include industry leaders like AECOM, Caterpillar, CBRE, Charles Schwab, Jacobs, and McKesson.

• The Metroplex is one of only two regions in the nation that hosts two Fortune 10 companies, namely Exxon Mobil and McKesson, and the combined revenues of Fortune 500 companies based here amount to $1.4 trillion, second only to the New York metropolitan area.

• Additionally, multiple major companies have expanded their distribution, logistics, and manufacturing operations over the years, including Amazon, BMW, DHL, Galderma, General Motors, Molson Coors, and Pratt Industries.

• Corporations such as 7-Eleven, American Airlines, Liberty Mutual, State Farm, FedEx, and Pioneer Natural Resources have also expanded into new corporate office spaces; furthermore, Goldman Sachs and Wells Fargo have announced new office construction projects that will accommodate thousands of employees.

• McKinney has more than doubled its population since 2000. The Census Bureau ranked McKinney as the nation’s fourth fastest-growing large city from 2010 through 2019, determining that the city’s 2020 population was 195,000 (rounded). Based on Census Bureau estimates, as of July 2022, the city’s population had already increased to 207,000 (rounded).

Long-Term, 20-Year Franchise License Agreement with IHG

• Upon acquisition and approval, an investor can expect a new, 20-year franchise license agreement with IHG.

• Per IHG, the avid brand focuses on the essentials done exceptionally well, including a great night’s sleep in a clean room; a high-quality, grab-and-go breakfast; and a modern design with the latest technology—all delivered to guests with outstanding service.

• IHG’s booking channels captured an average of 88.0% of avid Hotel reservations in 2023, with 53.9% of bookings related to IHG’s One Rewards loyalty program.

Management Availability

• The hotel asset is being offered free and clear of any management encumbrances, providing an investor with the flexibility of self-operating the hotel or installing a preferred management company.

For inquiries please visit here to execute the Confidentiality Agreement.