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Market Feasibility Study for Port Authority of Kansas City .

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Proposed Limited Service Hotel

Kansas City, Missouri

Prepared by Isabel A. Brandt, ISHC January 11, 2012

Isabel A. Brandt, ISHC BRANDT HOSPITALITY CONSULTING, INC. 5 Roan Lane St. Louis, MO 63124 (314) 989-0601 [email protected] January 11, 2012 Joe Perry Director of Real Estate and Development Port Authority of Kansas City 300 Wyandotte, Suite 100, Kansas City, Missouri 64105 816-559-3750 [email protected] Dear Mr. Perry: I have completed a feasibility study for the proposed limited service hotel to be located in Kansas City, MO. This study was completed in accordance with our contract letter dated September 23, 2011. My conclusions in this report are based upon facts gathered during the week of November 7, 2011, and changes in the market subsequent to this date have not been included in the report. The accompanying projections are based on estimates and assumptions developed in connection with the market study. However, some assumptions inevitably will not materialize and unanticipated events and circumstances may occur; therefore, actual results achieved during the period covered by the prospective financial analysis will vary from the estimates, and the variations may have a material impact on the proposed hotel. I have not been engaged to evaluate the effectiveness of management; therefore, the projections are based upon competent and effective management. All data and conclusions in this report are subject to the Assumptions and Limiting Conditions contained in the Exhibits of this report. Sincerely, BRANDT HOSPITALITY CONSULTING, INC.

Isabel A. Brandt

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Feasibility Study for a Limited-Service Hotel in Kansas City, Missouri EXECUTIVE SUMMARY Product Description: Number of Rooms: Opening Date: ADR (2011$): Occupancy (Stabilized): Stabilized Year: Meeting Space

Upper Scale Limited-Service or SelectService Hotel 150 - 175 Calendar Year 2014 $90 to 110 75 to 85% Calendar Year 2016 or 2017 3,000 – 5,250 Square Feet

Site Evaluation: Visibility: Access: Proximity to Demand: Proximity to Amenities: Competitive Position:

Excellent Very Good Excellent to Very Good Very Good Excellent

Kansas City MSA Lodging Market Summary 2009 Occupancy/Rate: 2010 Occupancy/Rate:

52.0%/$81.99 54.8%/$81.63

2010 YTD thru September Occupancy/Rate: 2011 YTD thru September Occupancy/Rate:

56.4%/$80.47 58.9%/$81.31

Assumptions and Limiting Conditions: It is assumed that either the proposed hotel is proximate to the casino and that a campus which integrates the two and parking can be developed. It would be desirable to have them connected or have a connecting walkway between the two. Given the proximity of a major demand driver (Isle Casino), an agreement regarding room rates could be mutually beneficial, especially given that the casino typically needs rooms on weekends when business travel and group travel is slow. This provides a potential advantage for developers of Limited Service hotels which often struggle to fill rooms during certain periods, and offers a new amenity for the casino patron. Projections include the assumption that the hotel includes 25% suite-style rooms and a higher than normal handicapped rooms.

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AREA ANALYSIS 

Kansas City, MO is part of the Kansas City Metropolitan Area which is located in northwestern Missouri and northeastern Kansas, 253 miles west of St. Louis, MO, 605 miles east of Denver, CO, 188 miles south of Omaha, NE and 190 miles northwest of Wichita, KS (see Exhibit A on page 20).

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Kansas City is accessed by two primary interstates: I-70 runs in an east-west direction connecting the Kansas City area with St. Louis and Denver. I-35 runs in a north-south direction, connecting the Kansas City area with Des Moines and Minneapolis, 194 miles and 439 miles north, respectively, and Oklahoma City and Dallas, 344 miles and 552 miles south, respectively.

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The Kansas City MSA metropolitan area has seen a 12.6% increase in population to over 2 million people in 2010 from 2000. The population of Kansas City, MO is estimated at 459,787 people, an increase of 4.1% over 2000, while Jackson County has seen an increase of 2.9% to 674,158 during the same time period (see Exhibit B on page 21). Between 2000 and 2010, both Kansas and Missouri have grown at 6.1% and 7.0%, respectively.

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The Kansas City MSA has a diverse range of employers which has brought stability to the overall economy (see Exhibit C on page 22). Most of the large employers are concentrated in Kansas City, MO or in Overland Park, KS. Kansas City MO is home to HCA Midwest, Hallmark Cards, and Cerner Corporation, as well as large facilities for the IRS and the FBI; while Overland Park is home to Sprint and Black & Veach. There are a range of manufacturing facilities including a large General Motors plant and distribution facility for Ford Motors. As with most large urban cores, there is a large health care sector as well, including several hospitals ranked highly on a national level.

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The Kansas City MSA has a strong office market (see Exhibit D on page 23). In total, there are 712 buildings with 48.9 million SF in 9 sub-markets. The two most relevant markets, Downtown and Northland, contain 58 and 67 buildings, respectively, with 8.2 million SF and 3.4 million SF, respectively, representing 23.7% of the available space in the area. Most of the hotels available in the downtown market are full-service hotels which are charging premium rates. The proposed hotel is likely to have a strong appeal for demand seeking more moderately priced accommodations close to the downtown area.

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Kansas City has a strong base of tourism. o Tourism peaked at 22.1 million visitors in 2008, fell in 2009 and has regained much of that for a total of 21.6 million visitors in 2010. Visitor spending is estimated at $2,567 million and helped to sustain 43,500 jobs in the region with a $4.3 million economic impact. 50.9% of the total expenditures were in Jackson County, MO, where the site is located. o 27.2% of the visitors originate from Missouri, with 20.2% of the visitors originating from Kansas; Oklahoma, Nebraska, Iowa and Texas are the next originating states with between 6.0% and 4.8% of tourists, in descending order. o 40% of all visitors come in parties of 2 adults, while 43% of daytrips are leisure and 40% of overnight trips are leisure. Casino visitation ranks 3rd in the top 10 activities, with 15% of visitors pursuing this activity. While the national average for visitors primary purpose of trip was to go to a casino was 9%, only 6% of visitors to Kansas City indicated that this was their primary purpose.

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Kansas City has seen a huge surge in development in the downtown area which began in 2003. All of these projects are located proximate to one another and proximate to the Convention Center, beginning 2.8 miles southwest of the site. o A new $138 million, 531,000SF headquarters for H&R Block began construction in 2003 and was occupied in 2006. H&R Block moved from their old headquarters located on The Plaza, 4.2 miles south. o The $250 million 19,000-seat Sprint Center was opened in 2007. o The $850 million, 8 block, 425,000 SF Power & Light Entertainment District began opening in phases in 2007. It features over 40 restaurants, bars, entertainment venues and retail outlets. o The last piece, the $413 million, 285,000 SF Kauffman Center for the Performing Arts opened in September 2011. It features two theaters; the 1,800seat Kauffman Theatre will be home to the Lyric Opera of KC and the KC Ballet, and 1,600-seat Helzberg Hall which will be home to the KC Symphony. o Additional office space and a 350-unit residential building are still being planned.

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The Kansas City Convention Center is located 2.7 miles southwest of the site and covers eight-square-blocks. It features a 388,800 SF column-free exhibit space on one floor, 48 meeting rooms, including 2 ballrooms of 46,400 SF and 23,910 SF, a 2,400-seat theater, and arena that seats more than 10,700 people, as well as two outdoor activity areas. The complex is connected to major downtown hotels and underground parking. The Center completed a $135 million 135,000 SF expansion in 2007, giving it one of the 10 largest ballrooms in the country. o Kansas City is able to attract a large number of conventions on an ongoing basis (see Exhibit D on page 23). The City peaked in 2008 with 24 conventions of over 1,000 rooms on peak night which attracted a total of 191,800 attendees utilizing 232,242 total room nights. Since this time, the total number of large conventions has fallen, with a low in 2009. In 2012, there are 18 large conventions booked with an additional 4 still considering the city which are expected to attract 157,450 people using 168,127 room nights. While the number of conventions and attendees is likely to only have a small direct impact on the proposed hotel, it is expected to have a significant impact on the overall Kansas City market, particularly the downtown market, and the proposed hotel’s success, particularly with regard to its ability to demand higher rates, is considered to be tied with the overall health of the Kansas City downtown hotel market.

CASINO ANALYSIS 

The proposed hotel is planned to be located adjacent to the Isle of Capri Casino. A significant portion of the demand accommodated at the hotel is expected to be generated by the casino. Therefore the unique market that the casino operates in will be considered and outlined.

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There are 13 casinos in Missouri (including the Isle of Capri adjacent to the site) and 6 casinos and 2 horse tracks in Kansas. All of the facilities in Missouri and Kansas are shown in Exhibits E and F on page 24 and 25. The 5 facilities in the Kansas City MSA are discussed following the section on overall state gaming.

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o Of the Missouri casinos, 4 are located in Kansas City metro region, 4 are located in the St. Louis region, and 4 are located in smaller communities throughout the state. A 13th casino, the President, operated in St. Louis until June of 2010, at which time its license expired. In 2009, the state’s casino generated 54 million annual visits, directly employed 11,071 and generated $367 million in tax revenues and $108 million in admission fees. Missouri ranks 7th in gaming revenues and excluding Nevada and New Jersey, Missouri has an 11% market share of the total state-regulated revenue1. 

All of the Kansas City, MO-area casinos were built in the mid-1990’s and in total, represent 310,600 SF of gaming space and generate 40% of the state gaming revenues. Argosy received a $105 million renovation in 2003 which won several design awards. There is currently one additional casino planned for Missouri discussed below.

o Kansas has 5 Indian casinos, 1 state-regulated casino, and 2 racetracks. Development of state-regulated casinos was not passed by the legislature until 2007, although there were already Indian casinos and racetracks in the state. Because the bill did not allow for slot machines in racetracks, subsequently 3 tracks have been closed. Four gaming ‘zones’ were established in state: the southeast, south central, northeast and southwest in 2007. The Boot Hill Casino opened in December 2009 in the southwest zone. It earned 37,787,943 in gaming revenues in 2010. Two casinos are currently under construction; a Star in the south central zone, and a Hollywood in the northeast zone, both of which are discussed below. Currently, there are no bidders for the southeast, possibly because there are 9 established casinos in Miami and Wyandotte, OK, 7 & 13 miles south of the Kansas border, respectively, and with easy accessibility to I44. o Missouri and Kansas are 2 of 13 states with state-regulated gaming. Additionally, there are approximately 28 states with Indian gaming. Nearby states that also have either state and/or Indian regulated gaming include Iowa, Nebraska, Oklahoma, and Illinois.

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This statistic does not include any Indian gaming, which is significant in several states.

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There are five casinos in the Kansas City MSA; 4 riverboat casinos in Missouri, and one Indian casino in Kansas City, KS. o The 45,600 SF Isle of Capri Casino (IOC-KC), where the site for the proposed hotel is located, is 2.4 miles northeast of the center of downtown Kansas City and is easily accessible by I-35 and surface streets. The IOC-KC is the closest casino to downtown and immediately off I-35 on a major traffic route, both for local commuters and those passing through the region traveling in either direction north-south. Originally opened in 1996 as a Flamingo Hilton Casino, it was purchased and converted to the Isle of Capri Casino in June 2000 and is now owned and operated by Isle of Capri, Inc. (IOC, Inc.). Additional discussion is featured beginning on page 9 of this report. o The 63,000 SF Harrah’s Kansas City is located 2.5 miles east of the site and 6.5 miles northeast of downtown. In addition to the greater distance, anyone traveling from downtown must pass the Isle of Capri Casino to reach Harrah’s. Although visible for motorists crossing the Chouteau Bridge on the Chouteau Trafficway, it is located 1.0 mile west of it, adding to the drive time, and the main entrance is on the back side. The Casino offers a 392-room hotel on site, and it is likely that the demand accommodated by the hotel is almost all related to the casino, but at a relatively low rate. Harrah’s is owned and operated by Caesars Entertainment which operates 43 casinos in North America. o The 20,000 SF 7th Street Casino is located in downtown Kansas City, KS 2.9 miles west of the center of downtown Kansas City, MO. This Indian-owned and operated casino only offers slot machines and a snack bar, and although located adjacent to City Hall, is on the fringe of downtown and adjacent to an unappealing neighborhood. The property provides limited parking but there are lots nearby in which ample parking is available. No data is available on revenues generated by Indian gaming in Kansas; however, due to its size, the lack of table games and restaurant facilities, and secondary location, it is likely that this casino generates significantly lower revenues than the other casinos in the Kansas City MSA.

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o The 62,000 SF Argosy Casino is located 6.7 miles north-northwest of the center of downtown. The property, which was built in the early 1990s when most of the area’s casinos were built, was heavily renovated in 2006, winning the Best Architectural Re-Design for a Casino Resort from the American Gaming Association. The property features a 258-room hotel in the property which opened in April 2007. A 48-room Super 8 that opened in 1998 is located nearby which indicates that they tend to fill with casino overflow on weekends but accommodate low-rated commercial demand during the week. The Argosy is very convenient for residents of Kansas City, KS and the suburbs to the north and west of the downtown area.

Interior of the Argosy Kansas City

o The 140,000 SF Ameristar Kansas City is the largest casino in the Kansas City MSA and the state of Missouri. It is located 9.7 miles northeast of the center of downtown, and again, motorists accessing downtown likely pass the Isle of Capri Casino. It is located off I-435, a circumferential highway, and, although visible from a bridge crossing the Missouri River, it required motorists to travel 2.0 miles from the highway exit. The property opened in 1997 and was acquired by Ameristar in 2000. In addition to its 6 F&B outlets, it features an 18-screen movie theater, a children’s area and a 184-room hotel that reportedly operates at a 97% annual occupancy, although likely at a very low rate. Management announced a 100-room addition over a year ago, and although they do not have final designs or approvals, indicates plans to build it in the next year.

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There are three casinos under construction in Kansas and Missouri. o A $368 million, 95,000 SF Hollywood Casino is currently under construction at the Kansas Speedway and planned to open in February 2012. It will feature 2,000 slot machines, 52 tables and employ 1,000 people. It will feature a steak restaurant, a buffet with sushi, a large lounge, a coffee bar and café. The $411 million casino is a joint venture between Penn National Gaming and the Kansas Speedway parent and is expected to attract 4 million people per year and have a $220 million economic impact on the region. The opening of the Hollywood is likely to have a negative impact on all of the casinos in the Kansas City area, with the biggest impact on the Argosy due to its location. The Speedway area offers 6 hotels with 714 rooms including a Great Wolf Lodge (and indoor waterpark). All of the hotels have been built over the last 7 years. Hotel Great Wolf Lodge Kansas City

Opening Date May 2003

Room Count 281

Hampton Inn Kansas City Village West

Sep 2003

76

Chateau Avalon Hotel

Jun 2004

62

Holiday Inn Express Kansas City Village West

Jul 2005

96

Country Inn & Suites Kansas City @ Village West

Feb 2008

117

Best Western Premier KC Speedway Inn & Suites

Jul 2011

82

o A 38,000 SF Isle Casino is under construction in Cape Girardeau by IOC, Inc. The $125 million project will include 1,000 slot machines, 28 table games, 5 F&B outlets and a 750-seat event center. The look, as shown below, is a more contemporary look that the corporation is trying to achieve, although the Kansas City property will not be updated to this look. o The Star Casino and Equestrian Center is under construction on the south side of Wichita on the Kansas Turnpike, 211 miles southwest of the site. A permanent casino and a 150-room hotel are scheduled to be completed by 2013; however, an interim casino is scheduled to open in February 2012 which will eventually be converted to an equestrian center. The $260 million project is being developed by Peninsula Gaming.

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ISLE OF CAPRI CASINO

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The performance of the Isle of Capri Casino-Kansas City is tracked by the Missouri State Gaming Commission. Its performance, as well as the performance of the other casinos in Missouri, is shown in Exhibits H and I on pages 27 and 28. o IOC-KC is signifianctly smaller than many of the casinos in Missouri, particularly those in the major cities of Kansas Ctiy and St. Louis. As a result, the IOC-KC’s revenues are proportionally, not as large. When viewed on a ‘per square foot’ basis, IOC-KC earns $1,834 per SF, which 16.2% is lower than the average of $2,189. The highest average is earned by the recently renovated Argosy, with $3,115, followed by the Harrah’s Kansas City. The Isle of Capri Boonville earns nearly as much total revenue as the IOC-KC, giving it a very high average per SF of $2,927. It is noteworthy that the Missouri casinos which do not have hotels all earn below the state average. o IOC-KC has seen admission and revenues increase in FY 2011 and only experienced a slight decrease in FY 2012 year-to-date, despite the construction of the Bond Bridge that was going on during FY 2011. Overall, statewide, most of the casinos have experienced decreases in revenues and IOC-KC has seen revenues decrease less than most of the Missouri casinos. o The month-by-month performance of the IOC-KC, as demonstrated through the number of Patrons, Admissions, Adjusted Gross Receipts and Taxes Paid is shown in Exhibit J on page 30. This demonstrates how consistent the revenues and related factors are on a month-by-month basis, especially when compared with the typical hotel performance. Peak revenues of $7,918,686 were achieved in March 2011, while the lowest level of revenues, $6,129,845, was achieved in January, 2011. However, the drop in revenues between the highest to the slowest month is only 22.6%.

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While the most patrons were experienced in August 2011, the highest revenues and taxes paid were achieved in March 2011, while the most admissions were experienced in October 20102.

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IOC, Inc. has shared a significant amount of confidential data with the consultant which has not been presented in the report, but which a number of conclusions are based upon.

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For serious prospective buyers, IOC, Inc. is willing to share comparative data regarding rates at some of its hotels, under a confidentiality agreement. However, it is a generally acknowledged assumption that casinos usually provide incremental demand for well-located nearby hotels.”

LODGING MARKET ANALYSIS 

There are 277 hotels with 31,576 rooms in the Kansas City Metropolitan Area.

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There are no hotels which are directly competitive with the proposed hotel, but instead, groups of hotels which are either competitive with the proposed hotel for specific segments or attract similar types of demand. o The proposed hotel is likely to attract demand that is emanating from downtown. This would include rate-sensitive leisure, commercial and convention-related demand. This demand is currently accommodated by a wide range of hotels based upon price, location and product offering. o There are 3 casinos with 817 rooms in the Kansas City area. The proposed hotel will compete directly with these for casino-related demand but each casino tends to have its own distinct clientele. None of these hotels participates in Smith Travel Research.

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Smith Travel Research Report of the Kansas City MSA indicates that the entire market achieved a 54.8% occupancy during 2010 at an $81.63 ADR (see Exhibit K on page 30). Between 2009 and 2010, market demand increased 6.7%, while the rooms supply increased 1.6%, resulting in a 2.6 point increase in occupancy. ADR decreased 0.4% during this time.

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Note: Patrons are the number of people, no matter what the length of stay while admissions is a fee paid to the state based on the total number of people ‘on board’ when the boat ‘departs the dock at a specific time’, so that a patron may experience several admissions in one stay. Revenue and Gaming Tax are directly proportional.

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o YTD through September, 2011, the Kansas City MSA achieved a 58.6% occupancy during 2010 at a $81.31 ADR. Compared to the same period in 2010, market demand increased 4.2%, while the rooms supply remained flat, resulting in a 2.4 point increase in occupancy. ADR increased 1.0% during this time. o Several sub-market and strata that are relevant to the proposed hotel had similar results, including the Kansas City MO market, which saw an increase in demand of 2.8% in 2010 and 2.7% YTD through September 2011, and the Upscale Market, which saw demand increase 8.8% in 2010 and 7.0% YTD through September. 

There are currently five hotels in under construction in the Kansas City MSA. o A 123-room Courtyard by Marriott is under construction and projected to open in June 2012 on a site on Briarcliff Parkway, 5.2 miles northwest of the site. Due to its location relatively close to downtown, its market positioning and product, it will be somewhat competitive with the proposed hotel. o An 83-room Holiday Inn Express & Suites is under construction directly west of Kansas University Medical Center in Kansas City, Kansas, 7.0 miles southwest of the site. The property is planned to open in June of 2012 and is being built to accommodate demand from the Medical Center and University and while it is not expected to be competitive with the proposed hotel, it may capture some price-sensitive weekend demand generated from downtown. o A 100-room Holiday Inn Express & Suites is under construction and projected to open in July 2012 on a site east of the Kansas City International Airport, 17.5 miles northwest of the site. Due to its location and the deep base of demand at the Airport, it is not expected to be competitive with the proposed hotel. o A 95-room Holiday Inn Express in Overland Park at 135th and Metcalf Avenue is in the early phases of construction, 21 miles south of the site. It is planned to open in late 2012. Due to its location, it will not be competitive with the proposed hotel. o A 106-room Hilton Garden Inn is under construction in Olathe, at I-35 and Strange Line Road, 21 miles southwest of the site. It is projected to open in June 2012. Due to its location, it is not considered competitive with the proposed hotel. o A 160-room NYLO Hotel which was planned for Overland Park at 135th Street is considered to be on hold, but has not been active for at least 2 years.

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Within the hotel industry, there are five basic types of demand; business transient, group, leisure transient, extended stay and contract. While there is some overlap between various segments, generally, they can be clearly identified. o Leisure-Transient travel is comprised of individuals who patronize transient lodging facilities for various reasons including vacations at area tourist attractions, visits with family or friends, or stopovers en route to another destination. Most of this demand is typically experienced on weekends. 

Due to the proposed hotel’s location adjacent and connected to the Isle of Carpi Casino, this is expected to be the single largest source of the demand captured by the hotel.

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The majority of the hotel’s weekend demand should be patrons specifically attracted to the casino. While many patrons may be attracted simply for the casino, the site’s location close to downtown Kansas City and the area amenities may also help to attract leisure demand who consider the casino an additional amenity. 

This is likely to be particularly true when there are major events in the area, including those at the Sprint Center downtown, the Sports Complex to the east and at the Kansas City Speedway to the west. Area hotels indicate that they sell out for these events, particularly those at the Speedway, and many are able to charge premium rates during these events.

o Business Transient Travel is comprised of travelers in the area for business reasons that generally fall into two main categories: local industry-related and transient. 

Local industry-related demand consists of travelers affiliated with local firms who are in the area for consultations, meetings, inspections and training seminars. Because these individuals are usually on expense accounts, they generally have a lessened sensitivity to room rates and tend to choose higher quality lodgings offering proximity to business activity, access to transportation and substantial amenities. Conversely, because the area businesses use these facilities, they wish to establish volume discounts and will typically have accounts with area hotels which grant them lower rates and frequently negotiated amenities such as free breakfast (if not included) and preferential reservation status.

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Transient commercial demand is generated by travelers not directly associated with local industry. These travelers include vendors and sales representatives visiting area industry, commerce and retail outlets, or en route to other destinations or those covering a broad area within a region or city. These travelers generally are more rate-sensitive, have locational preferences and stay at properties that are familiar to them and/or which are affiliated with major chains.

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In addition to the private sector, the government is another source of commercial demand. Government-related demand is rate sensitive, and subject to established per diems set by the federal and state governments, with visitors preferring lodging facilities located near government centers. Universities frequently fall under government per diems. The federal government per diem rate for 2012 in Jackson County is $99 per night.

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Commercial demand is realized primarily Monday through Thursday nights with Tuesday and Wednesday nights generally achieving the highest occupancies. Commercial demand is fairly consistent throughout the year, with the exception of holiday periods. Winters tend to be slightly slower than the balance of the year.

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There is likely to be a significant level of commercial demand generated by guests seeking rates below those offered by the full-service convention hotels in downtown Kansas City but still seeking quality and wanting to be proximate to the downtown area. o Affiliating with a national franchise, as opposed to operating under an independent flag, may help to attract commercial demand for a variety of reasons. Most brands have a loyal following as consumers have come to expect a quality level and price range of specific brands. Some of this loyalty is related to frequency programs, but not all. Commercial travelers on expense account are more likely to use the hotel if it does not have a name that affiliates it with a casino.

o Group Demand is comprised of those persons attending meetings (association, sales and corporate), conventions, educational seminars, training sessions and special events. Attendees usually patronize lodging properties that are close to meeting facilities and have adequate public space (meeting rooms, banquet facilities and hospitality suites) as well as other amenities.

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Groups tend to be more price-conscious than commercial travelers and are typically granted rate discounts because of their numbers. Lodging needs for the larger groups usually fall into two categories: in-house meetings (where a single property is used exclusively by a convention or meeting); or citywide meetings (where a very large group meets in the market and uses the facilities of a convention center and several hotels). o The hotel will attract some group demand seeking to combine a business meeting with leisure activities. o Some group demand associated with city-wide convetnions may be anticipated as some attendees seek lower priced alternatives still close to downtown but this is expected to be minimal. Most of these attendees are likely to be individuals as opposed to large room blocks by a single company or organization, although some companies do take blocks under the overall convention. Companies who send several representatives from different locations to a city-wide convention frequently use the convention to hold their own meetings and may require space separate from that used by the convention itself.

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Other types of groups accommodated by hotels consist of social groups (weddings and family occasions) sports groups, bus tours, religious and fraternal organizations. In traditional urban hotels, there is generally more flexibility in accommodating these groups since they are often booked to stay over weekends and help to offset the loss of commercial demand. Because the hotel is expected to accommodate a significant level of leisure demand on the weekend, there is likely to be very limited social group demand accommodated by the hotel.

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Arrival patterns vary by group type, although the majority of group demand is realized during the week. Spring and autumn are typically the most popular months for groups to meet, possibly to avoid traveling in inclement weather or conflicting with family vacation schedules.

o Extended-stay Demand tends to be clearly identifiable and have clearlydefinable needs, which are different than the traditional hotel guest. This category includes groups or individuals who are staying in a hotel for longer than normal periods of time, generally 5 - 7 days or more (and up to several months). Because of the nature of the proposed hotel, it is not expected to attract any Extended-stay demand.

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o Contract Demand is comprised of groups who are in a market working for a specific reason or job function. It is distinguished from group demand in that it is for a specific number of rooms on a regular basis and direct billed to the company. This demand includes airline crews and other transportation companies and some types of ongoing training and is usually at very low rates. Due to the proposed hotel’s market orientation, it is unlikely to accommodate contract demand.

SITE REVIEW Location: (see Exhibit L on page 31) 

The site is located in the southeast quadrant of I-35 and the Missouri River. Specifically, the site will be located between Front Street and the Missouri River. It will be part of the 28-acre campus which includes the Isle of Capri Casino and the final site determination has not been made.

The surrounding land uses include the following: North: South:

Missouri River E. Front Street, railroad track, industrial, Nicholson Ave. Kansas City Power and Light (electric yard) I-35

East: West: 

The site is on a 28-acre parcel on the east side of I-29/I-35 and just south of the Christopher Bond Bridge. The 28 acres is owned by the City of Kansas City, leased to the Port Authority of Kansas City and sub-leased to the Isle of Capri Casino. The 28-acre parcel is also adjacent to a 100-acre park and development parcel owned by the Port Authority of Kansas City, which lies on the west side of I-29/I-35 and connected by a trail under the new Bond Bridge. The Port Authority would like to see the 28 acres on the east side of the Bond Bridge fully developed with several different types of complimentary uses including a convenience store, restaurant and strip center retail. There are no specific plans at this time.

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I-35 leads into downtown to the south and North Kansas City to the north. The Paseo Bridge, which crossed the Missouri River, was replaced with the Christopher S. Bond Bridge which was completed in 2011. At that time, the interchange directly south of the Missouri River was significantly reconfigured into a Single Point Urban Interchange.

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Visibility: Excellent 

The proposed hotel should have excellent visibility, depending upon the final height for motorists traveling in both directions on I-35/29. Southbound motorists will have the best visibility as they cross the Missouri River.

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View of the new Christopher Bond Bridge as seen from the Isle of Capri parking lot

Access: Very Good 

Access to the site is direct, especially for an urban site. Motorists on I-35/29 site will exit the interstate, turn south at the signaled intersection at E. Front Street, proceed 0.2 miles and turn left into the site. Access has been improved following the development of the Christopher S. Bond Bridge when the exit and interchange were re-worked.

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It is assumed that either the proposed hotel is proximate to the casino and that a campus which integrates the two and parking can be developed. It would be desirable to have them connected or have a connecting walkway between the two.

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Final access to the proposed hotel will be determined based upon final site selection and roadwork.

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Proximity to Demand: Excellent to Very Good 

The site is proximate to the Isle of Capri Casino, which generates a significant level of demand. Further, the site is located 1.5 miles northeast of downtown Kansas City and 2.5 miles northeast of the Kansas City Convention Center.

Support Amenities: Very Good 

While there are no free-standing restaurants in the immediate area, there are currently two outlets located inside the casino, a buffet and a snack bar. A third restaurant (full-service, upscale) operated in the casino, and it would be desirable if it were re-opened following the opening of the hotel.



If development of the Port Authority’s 28 acres north of the Christopher Bond Bridge occurs, it is likely to include complimentary uses that will add to the amenity base including restaurant, convenience/gas

Competitive Position: Excellent 

The site is considered to be a strong location for a proposed hotel. It will be proximate to the casino which is considered both a demand generator and an amenity. It is located immediately off I-35 convenient to downtown and the northern suburbs. While it is not directly competitive with most of the nearby hotels, its unique location will enable it to capture demand from several segments.

PROJECTIONS 

Growth in the market is based upon continued market recovery combined with the availability of new hotel rooms in the region (see Exhibit M on page 32). The overall market occupancy is projected to increase to 57% in 2011 and 58% in 2012 and reach 60% in 2014. Following the opening of the proposed hotel, the market should increase occupancy, stabilizing at 62-64%. As some markets stabilize earlier, or unique opportunities are identified, new supply is likely to enter the market. 



A natural growth rate of 1 to 2% is assumed in the market with some induced growth resulting from the opening of the Subject.

Projections are based on the premise that the hotel will have a quality level consistent with upper moderate and select-service hotel chains with at least 25% of the rooms built as suites. It is further assumed that the hotel will be franchised with a nationally known chain, so as to increase its marketability as an alternative to hotels downtown.

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

The proposed hotel should also contain some meeting space in order to accommodate group business. The final determination of the meeting space should be based upon the site layout, hotel franchise and final size. The IOC, Inc. hotels range from 35 SF per room to 86 SF per room. Those casinos with hotels in Missouri and Kansas, excluding the IOC, Inc. hotels, range from 16 SF to 70 SF per room, with the lower range found in the larger cities. A final range is recommended based upon the matrix shown below. SF per Room/ Room Count 20 30

150 3,000 4,500

175 3,500 5,250



Estimates of the proposed hotels performance are based upon several factors including the hotel’s location adjacent to the Isle of Capri Casino, current market conditions combined with expectations of a continued recovery, and.



The hotel should achieve a very high penetration due to its unique market position and the performance of most hotels adjacent to casinos. Market penetration upon stabilization is estimated at 120% to 137%.



The projected stabilized occupancy of 75 to 85% for the proposed hotel is derived from the expectation of the hotel to accommodate demand emanating from downtown and from the casino both during the week and on weekends. Weekdays, it is projected that most of the demand will be business transient, with some discounted demand realized by the casino’s need to drive patronage. Weekends, the hotel will attract demand primarily related to the casino, much of which also be discounted. 

An assumption of these projections is that IOC-KC and the proposed hotel develop an agreement which is beneficial to both entities.



Some of the strength of the occupancy projections is based upon the occupancy levels experienced by the IOC-Waterloo Hotel, as well as that experienced by nearby hotels. The projections reflect a 2- to 3-year stabilization. While the hotel is projected to ramp up rapidly because of the demand generated by the casino, the final occupancy and ramp-up will depend upon the franchise brand chosen and the skill of management. Penetration upon stabilization is projected to be high; 120% to 137%.



The projected rate of the proposed hotel is derived from analysis of the existing rates in the market and those of the IOC-Waterloo and the quality level of the proposed hotel. The final achievable rate will heavily based upon the product and branding chosen.

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TABLE OF EXHIBITS Page

A. REGIONAL LOCATION MAP................................................................................... 20 B. POPULATION ............................................................................................................. 21 C. MAJOR EMPLOYERS................................................................................................ 22 D. OFFICE MARKET ...................................................................................................... 23 LARGE CONVENTIONS E. CASINOS IN MISSOURI AND KANSAS ................................................................. 24 F. MAP OF CASINOS IN MISSOURI AND KANSAS.................................................. 25 G. ISLE OF CAPRI – CASINOS AND MAP OF CASINOS .......................................... 26 H. MISSOURI CASINOS - PATRONS AND ADJUSTED GROSS REVENUE ........... 27 I.

MISSOURI CASINOS – ADMISSION REVENUE AND TAXES ............................ 28

J. ISLE OF CAPRI –MONTH BY MONTH ................................................................... 29 CASINO PATRONS AND REVENUES CASINO ADMISSIONS AND TAXES K. SMITH TRAVEL RESEARCH – HOTEL MARKET OVERVIEW .......................... 30 L. SITE LOCATION MAP .............................................................................................. 31 M. HISTORICAL AND PROJECTED SUPPLY AND DEMAND.................................. 32 N. ASSUMPTIONS AND LIMITING CONDITIONS .................................................... 33 O. QUALIFICATIONS OF THE CONSULTANT .....................................................34-36

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EXHIBIT A REGIONAL LOCATION MAP

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EXHIBIT B POPULATION KANSAS CITY METROPOLITAN AREA

Area

1980

Kansas City MSA (1) 1,449,380 4916686 Missouri 2363679 Kansas Counties Cass County, MO 51,029 Clay County, MO 136,488 Clinton County, MO 15,916 Jackson County, MO 629,266 Johnson County, KS 270,269 Lafayette County, MO 29,931 Leavenworth County, KS 54,809 Miami County, KS 21,618 Ray County, MO 21,378 Platte County, MO 46,341 Wyandotte County, KS 172,335 Municipalities over 50,000 Kansas City, KS Kansas City, MO Blue Springs, MO Independence MO Lee’s Summit, MO Olathe, KS Overland Park, KS Shawnee, KS

1990 1,636,552 5117073 2477574 63,808 153,411 16,595 633,234 355,021 31,107 64,371 23,466 21,971 57,867 161,993

80-90 Change 12.9% 4.1 4.8 25.0 12.4 12.4 0.6 31.4 3.9 17.4 8.5 2.8 24.9 (6.0)

149,767 435,146 40,153 112,301 46,418 63,352 111,790 37,993

2000 1,836,038 5,595,211 2,688,418

90-00 Change 12.1% 9.3 8.5

2010

00-10 Change

2,067,585 5,988,927 2,853,118

12.6% 7.0 6.1

82,092 184,006 18,979 654,880 451,086 32,960 68,691 28,351 23,354 73,781 157,882

28.7 19.9 14.4 3.4 27.1 6.0 6.7 20.8 6.3 27.5 (2.6)

99,478 221,939 20,743 674,158 544,179 33,381 76,227 32,787 23,494 89,322 157,505

21.2 20.6 9.3 2.9 20.6 1.3 11.0 15.6 0.6 21.1 (0.2)

146,866 441,545 48,080 113,288 70,700 92,962 149,080 47,996

(1.9) 1.5 19.7 0.9 52.3 46.7 33.4 26.3

145,786 459,787 52,575 116,830 91,364 125,872 173,372 62,209

(0.7) 4.1 9.3 3.1 29.2 35.4 16.3 29.6

SOURCE: City of Overland Park, US Census Bureau and Overland Park Economic Development council (1) Including 11 counties

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EXHIBIT C MAJOR EMPOYERS KANSAS CITY METROPOLITAN AREA COMPANY Federal Government HCA, Midwest Division Sprint Saint Luke’s Health System Hallmark Cards, Inc. State of Kansas Children’s Mercy Hospitals & Clinics City of Kansas City UPS - Supply Chain Solutions Cerner Corporation DST Systems, Inc. University of Kansas Hospital University of Kansas Johnson County Government Truman Medical Center, Inc. General Motors Corp AT&T Corp-Kansas City State of Kansas Saint Luke’s Hospital of Kansas City Farmers Insurance Group University of Kansas Medical Center KCP&L Internal Revenue Service Ford Motor Company Black & Veatch North Kansas City Hospital Truman Medical Center 

PRODUCT OR SERVICE EMPLOYEES LOCATION Government 18,764 Kansas City Health services (Division Hdq.) 8,125 Kansas City, MO Telecommunications (Hdq.) 7,000 Overland Park, KS * Health services 6,665 Kansas City, MO Greeting card mfg. (Hdq.) 6,200 Kansas City, MO * Government 5,314 Kansas City, KS Health services 5,108 Kansas City, MO Local Government 4,700 Kansas City, MO Package Services 4,646 Overland Park * Health care info systems (Hdq.) 4,600 North Kansas City Data processing systems (Hdq.) 4,402 Kansas City, MO Health services 4,481 Kansas City, KS Education 4,308 Overland Park, KS Government 4,100 Olathe, KS Health services 4,021 Kansas City, MO Manufacturing 3,900 Kansas City, KS Telecommunications 3,822 Kansas City, MO * Government 3,500 Kansas City, KS Health services 3,467 Kansas City, MO Insurance – Customer Service 3,455 Olathe, KS and Billing Health Services 3,453 Kansas City, KS Energy & rel. services (Hdq.) 3,250 Kansas City, MO * Government 3,200 Kansas City, MO Parts distribution center 3,300 Shawnee, KS * Architects/Engineering (Hdq.) 3,200 Overland Park, KS Health Care 3,200 North Kansas City, MO Health Care 3,180 Kansas City, MO

SOURCE: ThinkKC, 2011 Note: Not including cities of Leavenworth, Topeka and St. Joseph; not including school districts and local government * Multiple locations in MSA; major location listed

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EXHIBIT D OFFICE MARKET KANSAS CITY METROPOLITAN AREA Total Buildings Submarket Downtown Crown Center Plaza South Kansas City Northland East / SE Jackson County North Johnson County South Johnson County Other Suburban MarketsCity Metro Kansas Class A Class B TOTAL

Inventory (SF)

Vacant

Vacancy Rate

YTD Absorptio

Under Construction

58 17 31 43 67 85 132 249 30

8,167,000 3,703,000 2,943,000 3,248,000 3,436,000 3,216,000 6,488,000 16,014,000 1,708,000

2,495,000 527,000 580,000 718,000 1,037,000 558,000 1,072,000 2,422,000 162,000

31.6% -196,000 15.0% 13,000 20.4% 27,000 250,000 23.7% -49,000 31.2% -1,000 26,000 18.0% -41,000 16.8% 74,000 19.8% 654,000 98,000 10.5% -16,000 -

$16.20 $18.47 $21.96 $18.52 $15.88 $17.05 $17.33 $20.08 $14.54

108 604 712

17,293,000 31,631,000 48,923,000

3,132,000 6,439,000 9,571,000

19.6% 22.8% 21.7%

$20.37 $17.23 $18.17

120,000 374,000 346,000 465,000 374,000

Average Asking Rent

Average Asking Rent (Class A) $19.02 $19.10 $23.55 $19.03 $16.04 $20.91 $24.23 $22.99 N/A

SOURCE: Cassidy Turly, Third Quarter 2011

LARGE CONVENTIONS KANSAS CITY, MISSOURI

Year 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Convention (1,000+ rooms/night) Attendees Room Nights 24 145,500 214,075 24 191,800 232,242 16 122,200 148,169 20 172,850 204,165 17 121,700 143,158 18 157,450 168,127 14 133,920 144,950 11 111,240 132,782 5 45,800 66,603 5 35,900 64,056

Tentative Groups n/a n/a n/a n/a n/a 4 - 17,400 7- 27,350 8- 31,300 10- 83,000 11- 68,800

SOURCE: Kansas City Convention and Visitors Bureau

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EXHIBIT E MISSOURI AND KANSAS CASINOS Casino

Location

Distance to Site

Ownership

Isle of Capri Casino Kansas Riverboat Casino Kansas City, MO Isle of Capri Casinos, Inc. Harrah's North Kansas City Casino & Hotel North Kansas City, MO Caesars Entertainment Inc Wyandotte Tribe of Oklahoma 7th Street Casino Kansas City, KS and Wyandotte Gaming

Slot Tables Games F&B Size (SF) Machines and Poker Outlets

0.0

45,600

1,200

22

5

2.5

63,300

1,644

62

6

3.6

20,000

603

-

1

Argosy Casino - Kansas City Riverside, MO Ameristar Casino Hotel Kansas City Kansas City, MO

Penn National Gaming, Inc

4.4

62,000

1,980

39

6

Ameristar Casinos, Inc.

5.0

140,000

2,815

88

9

St. Jo Frontier Casino Prairie Band Casino & Resort

St. Joseph, MO

48.9

32,000

556

11

1

Mayetta, KS

Affinity Gaming Prairie Band Potawatomi Nation

65.2

35,000

1,100

31

3

Golden Eagle Casino

Horton, KS

Kickapoo Tribe of Kansas

69.1

45,000

742

18

2

Sac & Fox Casino

Powhattan, KS

74.4

106,000

830

13

3

Casino White Cloud Isle of Capri Casino Boonville

White Cloud, KS

Sac & Fox Tribe of Missouri Iowa Tribe of Kansas and Nebraska

87

21,000

389

-

1

Boonville, MO

Isle of Capri Casinos, Inc.

105

981

19

3

Eureka Downs

Eureka, KS

n/a

28,000 Horseracing 154 only

Mark Twain Casino La Grange, MO Ameristar Casino - St. Charles Saint Charles, MO Harrah's St. Louis Casino & Hotel Maryland Heights, MO

Affinity Gaming

226

18,000

665

14

2

Ameristar Casinos, Inc..

230

130,000

3,100

72

7

Caesars Entertainment Inc

233

120,000

2,703

97

7

Lumiere Place

St. Louis, MO

Pinnacle Entertainment, Inc.

250

75,000

2,062

68

6

River City - St. Louis

St. Louis, MO

Pinnacle Entertainment, Inc

253

2,020

67

9

Anthony Downs

Anthony, KS

n/a

90,000 Horseracing 274 only

Boot Hill Casino and Resort Dodge City, KS

Boot Hill Gaming

339

Lady Luck - Caruthersville

Isle of Capri Casinos, Inc.

430

Caruthersville, MO

1

21,400

1 584

13

3

23

623

4

SOURCE: Casinocity.com

MISSOURI AND KANSAS CASINOS WITH HOTELS Size (SF)

Meeting Meeting Largest Space SF SF of Casino per room Hotels Rooms Space Room / room

Casino

Location

Isle of Capri Casino - Kansas Riverboat Casino Harrah's North Kansas City Casino & Hotel Argosy Casino - Kansas City Ameristar Casino Hotel - Kansas City Prairie Band Casino & Resort Isle of Capri Casino - Boonville Ameristar Casino - St. Charles Harrah's St. Louis Casino & Hotel Lumiere Place River City - St. Louis Boot Hill Casino and Resort Lady Luck - Caruthersville

Kansas City, MO 45,600 North Kansas City, 1 392 63,300 MO Riverside, MO 1 258 62,000 Kansas City, MO 140,000 1 + 1 planned 184/100 Mayetta, KS 35,000 1 297 Boonville, MO 1 140 28,000 Saint Charles, MO 1 397 130,000 Maryland Heights, 502 120,000 MOLouis, MO St. 75,000 2 494 St. Louis, MO 90,000 Proposed 200 Dodge City, KS @35,000 +/U/C 108 Caruthersville, MO 21,400 1 & RV Park 27

10,000 18,000 8,000 12,000 12,000 20,000 8,000 8,000

9,792 7,844

25.5 69.8

161.5 240.3

11,280 8,000 11,817 6,290 5,400

40.4 85.7 50.4 15.9 16.2

117.8 200.0 327.5 239.0 151.8 450.0 @270-275 792.6

SOURCE: Casinocity.com

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EXHIBIT F MAP OF CASINOS (including additions) KANSAS CITY AREA

MISSOURI & KANSAS

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EXHIBIT G ISLE OF CAPRI CASINOS

Casino Isle of Capri Isle Isle Isle Lady Luck Isle of Capri Lady Luck Rhythm City Isle of Capri Isle of Capri Lady Luck Isle of Capri Isle Rainbow Isle

Slot Table & F&B Hotels/ Meeting Location Size (SF) Machine Poker Outlet Rooms Space Kansas City, MO 45,300 1,200 22 5 Bettendorf, IA 24,939 1,030 30 3 514 24,000 Biloxi, MS 42,770 1,287 36 5 711 0 Black Hawk, CO 21,204 1,100 24 3 2/402 0 Black Hawk, CO 16,381 500 17 3 164 6,000 Boonville, MO 28,000 981 19 3 140 12,000 Caruthersville, MO 21,400 623 23 2 27 0 Davenport, IA 29,062 900 14 0 Lake Charles, LA 48,900 1,850 76 4 3/501 14,500 Lula, MS 55,000 12,000 17 3 491 0 Marquette, IA 18,747 600 13 3 0 Natchez, MS 17,364 620 10 1 143 0 Pompano, FL Racetrack 1,500 38 0 Vicksburg, MS 25,000 831 10 2 89 0 Waterloo, IA 35,000 1,100 35 5 195 5,000

Largest Casino SF Meeting Space Room per Room SF per Room 9,600 0 0 6,000 8,000 0 0 9,150 0 0 0 0 0 5,000

48.5 60.2 52.7 99.9 200.0 792.6 n/a 97.6 112.0 n/a 121.4 n/a 280.9 179.5

46.7 0 0 36.6 85.7 0 n/a 28.9 0 n/a n/a 0 25.6

Source: CasinoCity.com and IsleofCapriCasinos.com

ISLE OF CAPRI CASINO LOCATIONS

SOURCE: IsleCorp.com

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EXHIBIT H MISSOURI CASINOS ADMISSION FEES AND GAMING TAX FISCAL YEAR 2010 THROUGH FISCAL YEAR 2012

Isle of Capri Kansas City ADMISSION FEES FY 2010 (7/09-6/10) 5,975,712 FY 2011 (7/10-6/11) 6,077,714 Change 1.7% YTD 2011 thru Oct 10 2,138,330 YTD 2012 thru Oct 11 2,156,190 Change 0.8% GAMING TAX FY 2010 (7/09-6/10) 17,142,713 FY 2011 (7/10-6/11) 17,564,318 Change 2.5% YTD 2011 thru Oct 10 5,846,012 YTD 2012 thru Oct 11 5,952,750 Change 1.8%

ADMISSION FEES FY 2010 (7/09-6/10) FY 2011 (7/10-6/11) Change YTD 2011 thru Oct 10 YTD 2012 thru Oct 11 Change GAMING TAX FY 2010 (7/09-6/10) FY 2011 (7/10-6/11) Change YTD 2011 thru Oct 10 YTD 2012 thru Oct 11 Change

Harrah's Ameristar Isle of Capri Kansas City Kansas City Boonville

Argosy

St. Jo

10,700,366 10,975,996 15,026,062 10,580,872 10,113,394 15,125,774 -1.1% -7.9% 0.7% 3,637,760 3,544,874 5,393,532 3,528,862 3,320,234 4,787,452 -3.0% -6.3% -11.2%

4,577,418 4,452,442 -2.7% 1,599,002 1,492,338 -6.7%

2,640,414 2,652,220 0.4% 910,846 251,372 -72.4%

40,735,812 40,558,460 -0.4% 13,385,643 13,522,150 1.0%

16,944,818 17,209,855 1.6% 6,016,565 5,877,220 -2.3%

8,056,241 8,430,518 4.6% 2,812,286 833,421 -70.4%

41,114,050 40,592,977 -1.3% 13,828,578 13,678,884 -1.1%

Lady Luck

Harrah's Maryland Hts

Lumiere Place

1,964,694 1,852,568 -5.7% 696,708 636,780 -8.6%

15,400,462 13,995,938 -9.1% 4,941,222 4,575,242 -7.4%

14,738,772 13,168,850 -10.7% 4,588,812 4,294,174 -6.4%

2,425,460 2,342,592 -3.4% 823,824 764,242 -7.2%

6,978,015 6,983,896 0.1% 2,473,190 2,383,483 -3.6%

60,478,634 56,550,517 -6.5% 19,500,121 18,732,692 -3.9%

40,966,780 36,377,153 -11.2% 12,100,480 12,053,509 -0.4%

7,772,676 8,004,393 3.0% 2,670,552 2,643,816 -1.0%

50,189,087 50,631,321 0.9% 17,053,035 16,521,026 -3.1%

Ameristar Mark Twain St. Charles

President

River City

TOTAL

16,492,440 15,567,036 -5.6% 5,356,284 5,082,728 -5.1%

1,984,464

4,695,776 12,628,698 168.9% 4,334,148 4,312,732 -0.5%

107,598,036 108,558,098 0.9% 37,965,342 35,202,346 -7.3%

60,645,847 58,444,755 -3.6% 19,552,829 19,164,041 -2.0%

4,036,188

12,074,564 37,989,717 214.6% 12,267,432 13,556,977 10.5%

367,135,424 379,337,881 3.3% 127,506,724 124,919,970 -2.0%

-100.0%

SOURCE: Missouri Gaming Commission Notes: * President boat had various closures due to flooding. License officially ended 6/29 2010. ** River City began operations March 2010. *** Lady Luck, Mark Twain and St. Jo boats all had closures from 1 to 12 days due to flooding and/or power outages.

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EXHIBIT I MISSOURI RIVERBOAT STATISTICS PATRONS Patrons BOAT Isle of Capri Kansas City Argosy Harrah's Kansas City Ameristar Kansas City Isle of Capri Boonville St. Jo Frontier * Lady Luck ** Harrah's Maryland Heights Lumiere Place Mark Twain ***** Ameristar St. Charles River City *** President **** State Totals State Totals w/o River City & President

FY 2011

FY 2010

Change

FY 2012 thru Oct/11

1,528,953 2,496,922 2,608,622 3,445,170 1,157,543 648,485 404,141 3,342,332 3,312,237 557,933 3,841,668 3,173,590 0 26,517,596 23,344,006

1,530,831 2,601,750 2,864,359 3,536,087 1,210,478 647,071 422,881 3,669,805 3,856,185 574,377 4,038,417 1,215,086 512,639 26,679,966 24,952,241

-0.1% -4.0% -8.9% -2.6% -4.4% 0.2% -4.4% -8.9% -14.1% -2.9% -4.9% 161.2% -100.0% -0.6% -6.4%

870,988 1,067,735 1,130,577 1,108,647 833,946 62,342 382,010 142,525 550,244 185,930 1,259,345 1,140,598 0 8,734,887 7,594,289

FY 2011 thru Oct/10 927,924 1,119,417 1,183,351 1,161,501 875,791 224,362 429,558 155,024 540,828 197,637 1,348,451 1,217,358 0 9,381,202 8,163,844

Change -6.1% -4.6% -4.5% -4.6% -4.8% -72.2% -11.1% -8.1% 1.7% -5.9% -6.6% -6.3% n/a -6.9% -7.0%

FY 2011 Win per Patron $54.70 $77.35 $74.10 $69.98 $70.80 $61.91 $82.29 $80.57 $52.30 $68.32 $72.44 $57.00 $0.00 $68.12 $69.63

ADJUSTED GROSS REVENUES Adjusted Gross Receipts BOAT

Casino SF

Isle of Capri Kansas City 45,600 Argosy 62,000 Harrah's Kansas City 63,300 Ameristar Kansas City 140,000 Isle of Capri Boonville 28,000 St. Jo Frontier * 32,000 Lady Luck ** 21,400 Harrah's Maryland Heights 120,000 Lumiere Place 75,000 Mark Twain ***** 18,000 Ameristar St. Charles 130,000 River City *** 90,000 President **** State Totals/Average 825,300/68,775 State Totals w/o River City & President

Revenue per SF $1,834 $3,115 $3,054 $1,722 $2,927 $1,255 $1,554 $2,244 $2,310 $2,118 $2,141 $2,010 $2,189

FY 2011

FY 2010

Change

$83,639,611 $81,631,967 2.5% $193,135,525 $193,980,055 -0.4% $193,299,891 $195,781,189 -1.3% $241,101,530 $238,993,433 0.9% $81,951,692 $80,689,611 1.6% $40,145,322 $38,360,052 4.7% $33,256,646 $33,228,615 0.1% $269,288,178 $287,993,494 -6.5% $173,224,539 $194,875,095 -11.1% $38,116,157 $37,012,742 3.0% $278,308,358 $288,789,578 -3.6% $180,903,413 $57,497,923 214.6% $0 $19,219,945 -100.0% $1,806,370,863 $1,748,053,697 3.3% 1,625,467,450 1,671,335,829 -2.7%

Total Adjusted Gross Receipts FY 2012 FY 2011 thru Oct /11 thru Oct/10 Change $65,137,544 $64,557,034 $89,203,296 $57,397,661 $64,391,192 $3,968,671 $27,986,761 $11,349,921 $28,346,428 $12,589,600 $91,257,336 $78,671,554 $0 $594,856,998 516,185,445

$65,850,372 $58,417,341 $92,857,718 $57,621,336 $63,741,157 $13,391,838 $28,650,310 $11,777,097 $27,838,151 $12,716,914 $93,108,710 $81,204,931 $0 $607,175,874 525,970,944

-1.1% 10.5% -3.9% -0.4% 1.0% -70.4% -2.3% -3.6% 1.8% -1.0% -2.0% -3.1%

n/a -2.0% -1.9%

SOURCE: Missouri Gaming Commission

* St. Jo Frontier boat closure 6/28/11 through 9/28/11 due to flooding. ** Lady Luck boat closure 5/1/11 through 5/12/11 due to flooding. *** River City began operations March 2010. **** President boat closure 28 days in FY 2010 due to flooding. License officially ended 6/29, 2010. ***** Mark Twain boat closure 6/27/11 due to power outage.

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EXHIBIT J ISLE OF CAPRI KANSAS CITY MONTH BY MONTH PATRONS & RECEIPTS

Month Current Year Jul-10 137,696 Aug-10 137,954 Sep-10 128,797 Oct-10 136,381 Nov-10 119,833 Dec-10 123,594 Jan-11 113,878 Feb-11 117,250 Mar-11 133,204 Apr-11 127,401 May-11 128,050 Jun-11 124,915 Year End 1,528,953/ Total/Average 127,413 Jul-11 139,972 Aug-11 143,105 Sep-11 133,555 Oct-11 133,612 YTD Total 550,244

Patrons Prior Year Change 144,095 -4.4% 137,469 0.4% 135,385 -4.9% 131,911 3.4% 120,292 -0.4% 113,509 8.9% 111,245 2.4% 119,761 -2.1% 129,273 3.0% 126,038 1.1% 135,758 -5.7% 126,095 -0.9% 1,530,831/ 127,569 -0.1% 137,696 1.7% 137,954 3.7% 128,797 3.7% 136,381 -2.0% 540,828 1.7%

Win per Patron Adjusted Gross Receipt Current Year Current Year Prior Year Change $ 51.59 $ 7,103,160 $ 7,080,859 0.3% $ 50.95 $ 7,028,397 $ 6,992,356 0.5% $ 52.34 $ 6,741,743 $ 6,974,960 -3.3% $ 51.07 $ 6,964,851 $ 6,768,641 2.9% $ 52.91 $ 6,340,724 $ 6,205,104 2.2% $ 54.93 $ 6,789,356 $ 6,224,953 9.1% $ 53.83 $ 6,129,845 $ 6,045,602 1.4% $ 62.10 $ 7,281,612 $ 7,268,882 0.2% $ 59.45 $ 7,918,686 $ 7,400,066 7.0% $ 57.98 $ 7,387,278 $ 6,853,412 7.8% $ 55.39 $ 7,092,889 $ 7,264,404 -2.4% $ 54.93 $ 6,861,070 $ 6,552,729 4.7% $83,639,611/ $81,631,967/ $ 54.70 $6,969,968 $6,802,662 2.5% $ 52.07 $ 7,288,701 $ 7,103,160 2.6% $ 50.00 $ 7,154,933 $ 7,028,397 1.8% $ 52.04 $ 6,950,646 $ 6,741,743 3.1% $ 52.03 $ 6,952,148 $ 6,964,851 -0.2% $ 51.52 $ 28,346,428 $ 27,838,151 1.8%

SOURCE: Missouri Gaming Commission

ADMISSIONS & TAXES PAID MONTH FY 2011 Jul-10 $541,510 Aug-10 $532,908 Sep-10 $504,344 Oct-10 $559,568 Nov-10 $478,856 Dec-10 $487,440 Jan-11 $462,048 Feb-11 $487,720 Mar-11 $530,860 Apr-11 $502,120 May-11 $502,610 Jun-11 $487,730 Year End $6,077,714/ Total/Ave $506,476 Jul-11 $542,104 Aug-11 $558,562 Sep-11 $517,894 Oct-11 $537,630 YTD Total $2,156,190

Admissions FY 2010 $557,520 $533,132 $522,186 $513,028 $472,962 $443,056 $442,114 $484,284 $507,934 $489,238 $531,858 $478,400 $5,975,712/ $497,976 $541,510 $532,908 $504,344 $559,568 $2,138,330

Gaming Tax

Change -2.9% 0.0% -3.4% 9.1% 1.2% 10.0% 4.5% 0.7% 4.5% 2.6% -5.5% 2.0% 1.7% 0.1% 4.8% 2.7% -3.9% 0.8%

FY 2011 FY 2010 Change 1,491,664 1,486,980 0.3% 1,475,963 1,468,395 0.5% 1,415,766 1,464,742 -3.3% 1,462,619 1,421,415 2.9% 1,331,552 1,303,072 2.2% 1,425,765 1,307,240 9.1% 1,287,267 1,269,576 1.4% 1,529,139 1,526,465 0.2% 1,662,924 1,554,014 7.0% 1,551,328 1,439,216 7.8% 1,489,507 1,525,525 -2.4% 1,440,825 1,376,073 4.7% $17,564,318/ $17,142,713/ $1,463,693 $1,428,559 2.5% $1,530,627 $1,491,664 2.6% $1,502,536 $1,475,963 1.8% $1,459,636 $1,415,766 3.1% $1,459,951 $1,462,619 -0.2% $5,952,750 $5,846,012 1.8%

SOURCE: Missouri Gaming Commission

BRANDT HOSPITALITY CONSULTING, INC. 29

Prepared for

EXHIBIT K

SMITH TRAVEL RESEARCH KANSAS CITY HOTEL MARKET PERFORMANCE 2009 & 2010 Market 2010

Kansas City, MO-KS Kansas City Kansas City North/Airport Kansas City MO Kansas City MO - Luxury Kansas City MO - Upscale Kansas City MO - Midpriced Kansas City MO - 75 - 149 rooms Kansas City MO - 150 - 299 rooms

54.8% 55.2% 59.3% 50.3% 61.3% 56.6% 49.4% 55.6% 55.9%

Occupancy 2009 Points Chg

52.2% 51.4% 59.8% 49.8% 57.4% 53.2% 47.9% 52.8% 53.0%

2.6 3.8 (0.5) 0.5 3.9 3.4 1.5 2.8 2.9

points points points points points points points points points

2010

ADR 2009

% Chg

$ 81.63 $ 103.28 $ 73.74 $ 61.61 $ 107.22 $ 86.27 $ 64.61 $ 68.87 $ 97.41

$ 81.99 $ 101.96 $ 73.69 $ 60.93 $ 108.97 $ 87.40 $ 65.02 $ 70.33 $ 98.22

-0.4% 1.3% 0.1% 1.1% -1.6% -1.3% -0.6% -2.1% -0.8%

RevPar 2009

2010

$ $ $ $ $ $ $ $ $

44.73 56.97 43.73 30.97 65.71 48.86 31.90 38.30 54.49

$ $ $ $ $ $ $ $ $

42.79 52.44 44.07 30.33 62.57 46.48 31.18 37.12 52.02

% Chg

4.5% 8.6% -0.8% 2.1% 5.0% 5.1% 2.3% 3.2% 4.7%

Average Daily Supply Average Daily Demand This Year % Chg This Year % Chg

31,862 10,369 7,871 4,885 12,447 4,653 7,785 13,864 6,720

1.6% 0.2% 3.5% 1.9% 3.1% 2.2% 1.7% 2.3% 3.5%

17,460 5,724 4,668 2,457 7,630 2,634 3,846 7,708 3,756

6.7% 7.4% 2.7% 2.8% 10.0% 8.8% 4.7% 7.8% 9.3%

SOURCE: Smith Travel Research - Total Supply is shown, not only participating hotels. Catagories not included: Overland Park-Lenexa, Economy, Budget, Less than 75 rooms, 300-500 room and Greater than 500 rooms

(Year to Date through September 2010 &2011) Market (Year to Date through September)

Occupancy 2011

2010

Kansas City, MO-KS Kansas City Kansas City North/Airport Kansas City MO Kansas City MO - Luxury Kansas City MO - Upscale Kansas City MO - Midpriced Kansas City MO - 75 - 149 rooms Kansas City MO - 150 - 299 rooms

58.6% 56.6% 63.7% 52.7% 64.8% 61.2% 52.1% 59.3% 60.8%

56.2% 56.0% 61.7% 50.9% 63.1% 57.9% 50.8% 57.0% 57.9%

ADR Points Chg

2.4 0.6 2.0 1.8 1.7 3.3 1.3 2.3 2.9

points points points points points points points points points

RevPar

2011

2010

% Chg

$ 81.31 $ 101.39 $ 74.34 $ 63.79 $ 105.13 $ 87.00 $ 65.13 $ 70.51 $ 91.49

$ 80.47 $ 99.61 $ 74.18 $ 62.11 $ 104.19 $ 86.73 $ 64.42 $ 69.30 $ 91.81

1.0% 1.8% 0.2% 2.7% 0.9% 0.3% 1.1% 1.7% -0.3%

2011

$ $ $ $ $ $ $ $ $

47.63 57.44 47.38 33.62 68.11 53.29 33.91 41.80 55.65

2010

$ $ $ $ $ $ $ $ $

45.25 55.93 45.80 31.62 65.77 50.25 33.72 39.49 53.15

Average Daily Supply Average Daily Demand % Chg

5.3% 2.7% 3.4% 6.3% 3.6% 6.0% 0.6% 5.8% 4.7%

This Year

32,003 10,317 7,954 5,064 12,613 4,833 7,773 13,622 7,104

% Chg

This Year

0.0% -6.0% 1.7% -0.8% 1.4% 1.3% 0.8% 5.5% 7.4%

18,754 5,839 5,067 2,669 8,173 2,958 4,050 8,078 4,319

% Chg

4.2% 0.6% 5.0% 2.7% 4.1% 7.0% 3.4% 5.5% 7.4%

SOURCE: Smith Travel Research - Total Supply is shown, not only participating hotels. Catagories not included: Overland Park-Lenexa, Economy, Budget, Less than 75 rooms, 300-500 room and Greater than 500 rooms

BRANDT HOSPITALITY CONSULTING, INC. 30

Prepared for

EXHIBIT L SITE LOCATION MAP

Before New Bridge and Interchange Reconfiguration

After Bridge and Interchange Reconfiguration

POTENTIAL SITE PLAN

BRANDT HOSPITALITY CONSULTING, INC. 31

Prepared for

EXHIBIT M HISTORICAL AND PROJECTED SUPPLY AND DEMAND MODEL Ave. Daily Occupied Demand Average ADR Rooms Growth Rate Growth

Year

Ave. Daily Available Supply Rooms Growth

Proposed Market Hotel's Occupancy Occupancy

Proposed Hotel's Penetration

Historical

YTD thru September

2009 2010

16,290 17,460

n/a 6.7%

$81.99 $81.63

--0.4%

31,352 31,862

n/a 1.6%

52.0% 54.8%

2010 2011

17,966 18,754

n/a 4.2%

$ 80.47 $ 81.31

-1.0%

31,862 31,862

n/a 0%

56.4% 58.9%

2011

18,158

4%

32,094

1%

(A)

57%

2012

18,885

4%

32,369

1%

(B)

58%

2013

19,262

2%

32,519

0%

(C)

59%

65% - 70%

110% - 118%

2014

19,648

2%

32,519

0%

60%

70% - 78%

116% - 129%

2015

19,844

1%

32,519

0%

61%

75% - 82%

123% - 134%

2016

20,043

1%

32,519

0%

62%

75% - 85%

122% - 138%

2017

20,243

1%

32,519

0%

62%

75% - 85%

120% - 137%

Projected

CAARC * (2009 - 2017)

2.7%

0.5%

CAARC * (2011 - 2017)

1.8%

0.2%

*

CAARC

Compound Annual Average Rate of Change

(A) The addition of 232 rooms between 4 new hotels (B) The remaining 175 rooms of the 4 hotels and the 100-room Holiday Inn Express & Suites at the Airport. (C) The proposed hotel with 150 rooms

BRANDT HOSPITALITY CONSULTING, INC. 32

EXHIBIT N ASSUMPTIONS AND LIMITING CONDITIONS 1.

The value or values presented in this report are based upon the premises outlined herein and are valid only for the purpose or purposes stated. Any values which are indicated are to be used for internal comparison purposes only, and the resulting numbers are not to be considered an appraisal. The consultant is not a qualified appraiser nor a member or candidate of the Appraisal Institute.

2.

I have no present or contemplated future interest in the properties being analyzed nor any personal interest or bias on the subject matter or the parties involved in potential development. My compensation was not contingent in any way upon the conclusion drawn herein.

3.

To the best of my knowledge, all data set forth in this report are true and accurate. Although gathered from reliable sources and checked insofar is possible, no guarantee is made nor liability assumed for the accuracy of any data, opinions or estimates identified as being furnished by others which have been used in formulating this analysis.

4.

Land areas and descriptions used in this analysis were obtained from management and public records, or as otherwise noted, and have not been verified by legal counsel or a licensed surveyor. The land description is included for identification purposes only and should not be used in a conveyance or other legal document without proper verification by an attorney. Plats, maps and other exhibits in this report are used merely to help the reader visualize the property and its surroundings, and no responsibility is assumed for their cartographic accuracy.

5.

No soil analysis or geological studies were ordered or made in conjunction with this report, nor was any water, oil, gas, coal or other subsurface mineral and use rights or conditions investigated. Because improvements in the area appear to be structurally sound, we assume that soil and subsoil conditions are stable. Substances such as asbestos, urea-formaldehyde foam insulation, other chemicals, toxic wastes or other potentially hazardous materials could, if present, adversely affect the development potential of the site. No responsibility is assumed for any such conditions, and the client has been advised that the consultant is not qualified to detect such substances, quantify the impact on development values or develop the remedial cost. The client is urged to retain an expert in this field if desired.

6.

It is assumed that the property will be efficiently managed and that ownership is in responsible hands.

7.

Full compliance with all applicable federal, state and local environmental regulations is assumed, as well as all applicable zoning, use and occupancy regulations and restrictions as stated and considered in this report.

8.

Any projections, forecasts, etc., regarding future patterns of income and/or expenses, prices/values, etc., represent the analyst's best estimates of investor anticipation’s with respect to these items, based on information available at the date of the analysis. Such information includes forecasts/projections published by recognized sources such as economists, financial publications, investor surveys, etc.

9.

Economic trends can affect future behavior of income, expenses, values, etc. Changes in these items caused by future occurrences could result in values different from those established in this report. I cannot accept responsibility for economic variables in the future which could not have been known or anticipated at the date of analysis (inflation rates, economic upswings or downturns, fiscal policy changes, etc.).

10.

Possession of this report or any copy thereof does not carry with it the right of publication. No portion of this report shall be disseminated to the public through prospectus, advertising, public relations, news or any other means of communication without the written consent and approval of Isabel A. Brandt.

11.

You agree to indemnify and hold Isabel A. Brandt harmless against and from any and all losses, claims, actions, damages, expenses or liabilities, including reasonable attorneys' fees, to which I may become subject in connection with this engagement. You will not be held liable for my negligence. Your obligation for indemnification and reimbursement shall be limited to Isabel A. Brandt.

12.

I reserve the right to include your company/firm name in my client list but will maintain the confidentiality of all conversations, documents provided me and the contents of this report, subject to legal or administrative process or proceedings.

13.

These conditions can only be modified by written documents executed by both parties.

BRANDT HOSPITALITY CONSULTING, INC. 33

EXHIBIT O QUALIFICATIONS OF THE CONSULTANT Isabel A. Brandt, ISHC 5 Roan Lane St. Louis, MO 63124 (314) 989-0601 [email protected] brandthospitality.com

EXPERIENCE BRANDT HOSPITALITY CONSULTING, INC. Hospitality Consultant, 1992 - Present St. Louis, MO and Oak Park, IL REAL ESTATE ADVISOR GROUP OF AMERICAN APPRAISAL ASSOCIATES Senior Consultant, 1991 - 1992 Chicago, IL McCORMICK CENTER HOTEL Director of Convention Services, 1990 - 1991 Chicago, IL MARRIOTT CORPORATION Manager, Market Planning and Feasibility, 1988 - 1990 Regional and Corporate Offices Chicago, IL, and Washington, DC Catering Sales Manager, 1985 - 1988 New York Marriott Marquis New York, NY EDUCATION APPRAISAL INSTITUTE Chicago, IL NEW YORK UNIVERSITY GRADUATE SCHOOL OF BUSINESS Master of Business Administration, 1988 New York, NY CORNELL UNIVERSITY SCHOOL OF HOTEL ADMINISTRATION Bachelor of Science, 1981 Ithaca, NY MEMBERSHIP INTERNATIONAL SOCIETY OF HOSPITALITY CONSULTANTS

BRANDT HOSPITALITY CONSULTING, INC. 34

EXHIBIT P APPRAISALS Santa Monica Beach Hotel (Park Hyatt), Santa Monica, CA Sheraton Prescott Resort (and Casino), Prescott, AZ Red Lion, Medford, OR Red Lion, Klamath Falls, OR Hilton, Fayetteville, AR Days Inn - Research Triangle Park, Morrissville, NC Holiday Inn, Oak Brook Terrace, IL Days Inn - Crabtree, Raleigh, NC Holiday Inn of the Northern Black Hills, Spearfish, SD Embassy Suites, Washington, DC Holiday Inn, Mundelein, IL Innkeeper Motor Lodge - Peters Creek, Winston-Salem, NC Holiday Inn, Crystal Lake, IL The Herrington Hotel, Geneva, IL The Stratford Inn, Sycamore, IL Holiday Inn, Willowbrook, IL Amerihost Inn, Allen, TX Days Inn, St. Charles, IL Amerihost Inn, Muskegon, MI Amerihost Inn, Birch Run, MI Cliffbreakers Hotel, Rockford, IL Doubletree Club - Oak Brook, WI Hampton Inn - Miami Beach, FL

FEASIBILITY STUDIES Courtyard by Marriott Altamonte Springs, FL Atlanta, GA Altoona, PA Bloomington, IL Blue Springs, MO Chesterfield, MO Columbus, OH Euclid, OH Hoffman Estates, IL Kokomo, IN Lansing, IL Lombard, IL New Orleans, LA Portland, OR Warsaw, IN Waterbury, CT Willoughby, OH

Residence Inn by Marriott Albany, NY Augusta, GA Colorado Springs, CO Hamburg, NY Houston, TX Kansas City, MO Newburgh, NY N. KS (Cincinnati, OH) Lee’s Summit, MO Rockford, IL Rolling Meadows, IL Rosslyn, VA Springfield, IL Waukegan, IL Westford, MA

Fairfield Inn by Marriott Arlington Heights, IL Brookings, SD Clackamus, OR Cleveland, OH Collinsville, IL Colorado Springs, CO Daytona Beach, FL Edmond, OK Frankfurt, KS Fremont, CA Glenview, IL Hays, KS Indianapolis, IN Johnson, IA Joplin, MO Kansas City, MO Kissimmee, FL Knoxville, TN Lakeland, FL Manhattan, KS Marion, IL Mattoon, IL Naperville, IL Nashville, TN New Orleans, LA Orlando, FL Ottumwa, IA Overland Park, KS (Suites) Plainfield, IN Portland, OR Spearfish, SD South Holland, IL

OTHER FEASIBILITY Bloomington, IL Carol Stream, IL Cedar Rapids, IA Cincinnati, OH Columbia, MO Fort Wayne, IN Kansas City, MO King of Prussia, PA Kokomo, IN Norwich, CT Mattoon, IL Miami Springs, FL Monticello, IN Phoenix, AZ Richmond, VA Schaumburg, IL St. Robert, MO Terre Haute, IN Vaughan, Canada Versailles State Park, IN Washington, MO Wausau, WI Williamsville, NY Wheeling, WV

CONSULTING ENGAGEMENTS (Impact, Conversion, Market Overviews and Expert Witness) Ashland, WI Atlantic City, NJ Austin, TX Birmingham, AL Buffalo, NY (4 properties) Chicago (downtown), IL Eastlake, OH Forest Park Hotel, St. Louis, MO Helena, MT Little Rock, AR Mattoon, IL Naperville, IL Okawville, IL Omaha, NE Overland Park, KS Palm Springs, CA Providence, RI Portage, IN Rosemont (O'Hare), IL Sandusky, OH St. Louis Airport Scottsdale, AZ Spokane, WA S. Kingston, RI The Elms Spa and Resort; Excelsior Springs, MO The Royalton; Manhattan, NY Warwick, RI Wenatchee WA Westlake, OH West Des Moines, IA Winston-Salem, NC

CLIENTS SERVED Bank of New York Best Western International Century Pacific/Le Baron Hotels Choice Hotels CNA Insurance debis Financial Services, Inc. Ferguson Properties First of America Gloodt Associates/Great Lakes Realty Holiday Inn Worldwide Hospitality Consulting Group HFS/Cendant Hotel and Club Associates Landauer Real Estate La Quinta Inns Leisure Development Lerner Renovations Lincoln Land Development Manor Care Marriott International McHugh Enterprises NationsCredit Commercial Resolution Trust Company Rockgate Inns, Inc. Rosenblum, Goldenhersh, Silvestein & Zafft RHW Companies, Inc. True North Hotel Group

BRANDT HOSPITALITY CONSULTING, INC. 35

ISABEL A. BRANDT

Isabel A. Brandt, ISHC is president and founder of Brandt Hospitality Consulting, Inc. (BHC). BHC is a hospitality and real estate consulting firm which specializes exclusively in hotel real estate including financial analysis, feasibility, valuation, market analysis, appraisal services, impact, strategic development and other related services to the hospitality industry. Ms. Brandt's recent clients represent major hotel franchise organizations, large management companies, leading banks and federal, state and city government. BHC is celebrating its 10th anniversary in 2002. Ms. Brandt has completed over 200 hospitality-related projects in over 125 markets in over 35 states. She has experience in a variety of location types ranging from large downtown and suburban markets in New York, Chicago and Los Angeles, medium sized communities such as Waterbury CT and Wausau, WI, and smaller and rural communities like Spearfish, SD (population 5,000) and Versailles, IN (population 1,800). Ms. Brandt has experience with a variety of hotel products ranging from 50-room limited-service hotels, 400+ room deluxe hotels, extended-stay and all-suite hotels, as well as those involving historic renovations. This list includes hotels considered budget properties to luxury properties with ADR's in excess of $250. Ms. Brandt acted as Senior Hospitality Consultant for American Appraisal Associates Real Estate Advisory Group in Rolling Meadows, IL. She supervised and conducted appraisals and valuations throughout the United States. She worked with a variety of real estate assets including office and industrial projects. Prior to this experience, Ms. Brandt served as a Manager of Hotel Development and Market Planning with Marriott Corporation's both in the Washington, DC headquarters and Midwest Region development office in suburban Chicago, IL. She conducted market feasibility analysis, impact studies, and financial projections for Marriott Hotels, Courtyard, Residence Inn, and Fairfield Inn in markets throughout the United States. She also developed market models used throughout the department. Ms. Brandt has an extensive background in hotel operations. She served as Director of Convention Services of the 614room McCormick Center Hotel in Chicago IL. Due to the hotel's location adjacent to McCormick Place Convention Center, she gained extensive exposure to large-scale conventions and trade shows. Ms. Brandt was part of the opening team of the New York Marriott Marquis, where she served as a Catering Manager for this 1876-room hotel. Ms. Brandt is a graduate of the School of Hotel Administration at Cornell University and holds a Master of Business Administration with International Marketing major from the New York University Graduate School of Business Administration (Stern School of Business). She is an active member with the International Society of Hospitality Consultants.

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