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• Lodging Demand Analysis. Regarding customer-segmented lodging demand, we have • several conclusions about the proposed Mounds View Hotel's ability to capture room nights: (1) The Group Meetings segment will produce 3,650 room nights; (2) The Group Leisure segment will produce 5,290 room nights; (3) The Individual Business segment will produce 12,460 room nights and (4) The Individual Leisure segment will produce 13,600 room nights. The proposed Mounds View hotel will achieve these segmented roomnight contributions in the third stabilized year of operation. First year forecast is conservatively forecasted on achieving fair share of demand as follows: (1) Group Meetings 3115 room nights; (2) Group Leisure 4,673 room nights; (3) Individual Business 11,215 room nights and Individual Leisure 12,149 room nights, producing a first year occupancy of 63.8%. • Customer Mix. Based on our analysis, we recommend that the proposed Mounds View Hotel strive to achieve a customer mix of 10% group meetings 15% group leisure 36% individual business 39% individual leisure • Hotel Supply & Demand Trends. Primary & secondary competitors for the proposed Mounds View Hotel consists of 19 hotels with 2570 rooms located in Arden Hills, Blaine, Coon Rapids, Fridley, Roseville, Maplewood, Brooklyn Park, Shoreview, White Bear Lake, 41) Minneapolis, and Mounds View. YTD 1995, these 19 hotels achieved a 69.4% occupancy and a $55.76 average room rate. Of these 19 hotels, 11 hotels with 1806 rooms are primary competitors. YTD 1995, these 11 primary competitors achieved a 65.5% occupancy and a $63.34. No new hotel rooms have been added to the primary lodging supply since 1992 while the primary lodging demand decreased 2.4% in 1995. Primary and secondary competitors increased room revenues 10.2% in 1995 while primary competitors increased revenues 4.2%. In the Mounds View market area, hotel supply growth and demand growth have been running evenly since 1992. Supply growth in 95 vs 94 was 4.0% and demand growth was 3.8%. Several hotels in the Mounds View market area are under development for 1996. _ • Recommended Product & Facilities. We conducted interviews with the major demand generators and the competitor hotels to verify the demand for a full service hotel with meeting/banquet facilities in Mounds View. As a result of these interviews and other factors, we concluded that: (1) the proposed Mounds View Hotel should be designed with 135 guest rooms with meeting space for 350 people; (2) the hotel should have a perceived value equal to the two Holiday Inns in the market area; (3) published room rates should be from $45 to $75 with a first year ADR of $54; (3) the hotel should incorporate a majority of our product recommendations demanded by the market.