Airport Hilton Hotel Update — original pdf

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Hilton Austin Airport Information for Airport Advisory Commission City of Austin, Department of Aviation December 14, 2021 0 AGENDA • Hotel Property and Facility • Structure and Operations • Financial Information • COVID Impacts • 2021 Performance and Loan Status 1 Property and Facility 2 Hilton Austin Airport – Unique History • Former Headquarters of Bergstrom Air Force Base • Opened in 1968 • Three stories • Underground bunker • Enclosed courtyard • Names: • Building 2900 • The Roundagon • The Donut • The Little Pentagon • Base closed in 1993 3 Hilton Austin Airport – Property Information • Title to Improvements: Vested in City of Austin as part of AUS operations • Summary of Salient Property Data • Property Name: Hilton Austin Airport (Hilton) • Address: 9515 Hotel Drive, Austin, Texas 78719 • Location: Austin-Bergstrom Intl. Airport (AUS) • Occupancy Rights: AUS Ground Lease • Land Description • Area: 10.61 acres, or 462,019 square feet • Zoning: AV - Aviation Services • Assessor's Parcel Number(s): 855896 • FEMA Flood Zone: Zone X 4 Hilton Austin Airport – Facility Information Austin American Statesman December 17, 2000 • Improvements Description • Year Opened: 2001 • Property Type: Full-service lodging facility • Building Area: 206,608 square feet • Guestrooms: 262 • Number of Stories: Four • Meeting Space: 17,505 square feet • Parking Spaces: 278 (Surface) • Additional Facilities: Outdoor pool, an outdoor whirlpool, fitness center, a lobby workstation, guest laundry room, and vending areas • Food and Beverage Facilities: Restaurant and lounge, coffee shop 5 Structure and Operations 6 Hilton Austin Airport – Structure & Operations • Austin-Bergstrom Landhost Enterprises, Inc. (ABLE) • Texas nonprofit public facility corporation created by City of Austin (City) in 1998 • Authorized under Chapter 303 of Texas Local Government Code • ABLE acts on behalf of the City of Austin (City) • Created to be the Issuer of tax exempt bonds (1999 Bonds and 2017 Bonds) • Construct/improve public facilities at the Airport - Hilton Austin Airport (Hotel) • Department of Aviation (Aviation Department) oversight of ABLE • Staff provide liaison, business, and financial services to ABLE • Grant Agreement - Aviation Department supports Bond payments – as required • Ground Lease - Aviation Department receives Ground Rent/Administrative Fees • Operations of the Hotel are subject to Federal Aviation Administration regulations 7 2021 Financial Performance 8 Hilton - COVID-19 Financial Impact • Before the Covid-19 pandemic, the hotel operated profitably and was EBITDA positive since the 2017 bond restructuring • 2017 Grant Agreement between ABLE and AUS • Requires Dept. of Aviation to replenish to Debt Service Reserve Fund (DSRF) if proceeds from Hotel operations are insufficient • October 1, 2020, April 1, 2021 and October 1, 2021 payments were made • April 1, 2022 payment of $1,056,000 to DSRF anticipated – partial payment possible • 2021 Loan Agreement – $2,600,000 • Initial Draw/August, 2021 - $1,350,000 – Accounts Payable for 2020 and 2021 • Future Draws - $1,250,000 • Future Funding (only if required) • Draw rights expire December 31, 2022 9 Loan Draws and Spending Through 11/30/2021 • Base Loan Amount – $1,350,000 (funded 8/9/2021) • Spent to Date $824,599 • Unused Base Loan Proceeds in ABLE’s account $525,401 • Due to better than anticipated recovery of hotel occupancy the full Base Loan Amount is currently not needed • Transfer of unused Base Loan Proceeds to Department of Aviation - anticipated at or about 2021 year end 10 Hilton Austin Airport 2021 Performance Through 10/31/2021 2021 Jan Actual Feb Actual Mar Actual Apr Actual May Actual Jun Actual Jul Actual Aug Actual Sept Actual Oct Actual YTD Actual Revenue Occupancy 22.1% 34.8% 51.3% 52.1% 53.1% 67.9% 73.9% 66.0% 71.8% 87.7% 58.2% Average Daily Rate (ADR) $106.46 $109.74 $110.30 $122.22 $127.06 $131.11 $129.69 $132.83 $146.28 $175.29 $134.59 Operating Revenues $236k $347k $571k $641k $706k $856k $902k $890k $1.0m $1.4m $7.2m EBITDA before Grant and PPP ($212k) ($120k) $4k $86k $55k $194k $163k $166k $248k $562k $1.1m • Now current on Ground Lease payments to Department of Aviation that had been accrued since start of the pandemic: • Ground Rent • Administration Fee 11 Thank You City of Austin, Department of Aviation Austin-Bergstrom International Airport 12