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CDC - Item 4A - Rosemead Inn Hotel OperationsE M F s QQ ��PnR11F� � h 0 ROSEMEAD COMMUNITY DEVELOPMENT COMMISSION STAFF REPORT TO: THE HONORABLE CHAIRMAN AND COMMISSIONERS FROM: OLIVER CHI, EXECUTIVE DIRECTOR 6 -i- DATE: AUGUST 26, 2008 SUBJECT: ROSEMEAD INN HOTEL OPERATIONS SUMMARY On July 2, 2008, the Rosemead Community Development Commission acquired the Rosemead Inn located at 8832 Glendon Way. As the Commission may recall, the purchase of this site is part of an overall larger redevelopment project known as the Glendon Way Project. Over the past several months, staff has been working with Primestor Development (owner of the Levitz site) and Jacobsen Family Holdings on a conceptual overall development plan for the Glendon Way Project. Regarding the Rosemead Inn Hotel, the Commission has the option to renovate /upgrade the property and contract with a firm to continue with the current operation. This would create an additional flow of cash for the City while the long term development plans for the site are finalized. Staff has solicited proposals from reputable company's specializing in hotel operations and received responses from Grand Inn, Inc. and Rosemead Inn Hotel Partners, LLC. Staff Recommendation Staff recommends that the Community Development Commission select Rosemead Inn Hotel Partners, LLC, as the operator for the hotel and direct staff to negotiate a finalized operating agreement for consideration. ANALYSIS Staff solicited proposals from several hotel operators for the purpose of renovating /upgrading and managing the Rosemead Inn. The City received a response from two management service companies in the hotel industry: Rosemead Inn Hotel Partners, LLC Grand Inn, Inc. APPROVED FOR CITY COUNCIL AGENDA: 0 0 Community Development Commission August 26, 2008 Page 2 of 3 Rosemead Inn Hotel Partners, LLC Rosemead Inn Hotel Partners, LLC acquires and develops multi - tenant commercial real estate properties throughout the Western United States and New York City. The Company's acquisition focus is on office, hotel /hospitality, retail and multifamily property types. The proposal that they submitted includes the following provisions: • A two year lease agreement • $305,225 in renovations /upgrades to the property with $100,000 being paid for by the CDC. • A lease payment to the City of 50% of the monthly net profits (see Attachment A). o The payment schedule would begin after the renovations have been completed which is expected to take approximately three (3) months. • Rosemead Inn Hotel Partners, LLC, would pay all expenses related to daily operations, which include wages, repair, utilities, etc. In addition, they will provide both property and general liability insurance. Grand Inn, Inc. Grand Inn, Inc. currently owns and operates the Win All E -Z Inn in El Monte, Valley Hotel in Rosemead, and Grand Inn in Fullerton. The proposal that they submitted includes the following provisions: • A two -year lease agreement with a three -month cancellation clause by either party. ■ $200,000 in renovations /upgrades to the property with no CDC contribution. • A lease payment to the City of $5,000 per month in the first year of operations and $10,000 per month in the second year of operations. o The payment schedule would begin after the renovations have been completed which is expected to take approximately six (6) months. • Grand Inn, Inc, would pay all expenses related to daily operations, which include wages, repair, utilities, etc. In addition, they will provide both property and general liability insurance. It should be noted that regardless of which operator is selected, the City would also receive additional revenue through the Transient Occupancy Tax (TOT). The TOT constitutes a 10% tax on the rent charged to each transient occupant (less than 31 days occupancy). 0 0 Community Development Commission August 26, 2008 Page 3 of 3 PUBLIC NOTICE PROCESS This item has been noticed through the regular agenda notification process. Prepared by: Michelle G. Ramirez Economic Development Administrator Submitted by: Brian Saeki Assistant Executive Director Attachment A — Rosemead Inn Hotel Partners Income Matrix Attachment B — Rosemead Inn Hotel Partners, LLC Proposal Attachment C —Grand Inn, Inc. Proposal C O1 E t U N V a U J J Ul c r m CL N O 2 C C m d E Qfv O x I9 d E O U E O U c C C Q _T U O w E O U c — T C O O d Z d Z f6 O F rn d c N CL x x W T L c O N ul O u w E O U C _T L c O 2 m E 0 U C _% L C O 2 W E O O 0 O 0 0 CD o m co 00 CD CD W I 0 1n 0 M N U) O to O) n V> r N in � r r O O L6 r Ln p M V M M N M N to (p M M M M M M m O o 0 O � Lo OD O N O V y EA EA (i3 co (D (D r 6 v of v of v 6 It 00 00 00 W O M O M 0) M U) M 69 to (n O o O O O Cl o O 0 O 6 O 6 O 6 O c0 (O (0 V co N 07 C O (O O 00 �9 �9 CO (0 r-- N r- M co I- C) O O O O O O O O O O O O O O (U (A (A EA 69 0 E T 0 E T N E T N E T O U C LO Q O U C LO n O U C LO O O U C (0 Q C O U U C >` O U U C T O U U C T U U 0 0 ° O ° O M 2 Lo CA 0 0 0 HOTEL- RoSEEMEAD Rosemead Inn Hotel Partners LLC. (working name) PROPOSAL TO THE CITY OF ROSEMEAD Rosemead Inn Remodel, Repositioning, and Operation 8832 Glendon Way Rosemead, California 91770 SUBMITTED BY: Rosemead Inn Hotel Partners LLC. (Worldng name) 16388 E. COLIMA ROAD, SUITE 206 HACIENDA HEIGHTS, CALIFORNIA 91745 PHONE: 626- 336 -0100 FAX: 626- 336 -0030 August 13th, 2008 U Table of Contents 1. Introduction H. Remodel and Repositioning Concept III. Design Concept IV. Operational Proposal 1. Proposal 2. Finance Plan 3. Operational Income Projections 4. Overview of Hotel Market V. Development/Operation Team A. Mohamed Seirafi / M. K. Jana Enterprises 1. Resume 2. Developmental & Operational Experience B. David Ly / Cementum Inc. 1. Resume 2. Developmental & Operational Experience 0 INTRODUCTION 0 The Rosemead Inn Hotel Partners LLC. would like to propose to the City of Rosemead the Remodel, Repositioning, and Operation partnership of the existing Rosemead Inn located at 8832 Glendon Way in the City of Rosemead. The Remodeling, Repositioning, and Operation (RRO) is to compliment the diverse business's of the City of Rosemead and surrounding communities by bringing jobs, recognition, and additional income streams. It is also to compete and recapture business and lost revenue from the competing surrounding hotels in adjacent communities. The City is currently in need of a destination orientated freeway accessible hotel to serve the City and surrounding communities. This is particularly true in the northern part of Rosemead along the Interstate 10 corridor as the other destination hotels are in the Southern part of the City. Large amounts of business and room revenue is escaping the City at a pace that needs to be stopped by competing hotels such as the Lincoln Plaza Hotel in Monterey Park and the Hilton San Gabriel. As these hotels are much larger and an amenities package that dominates the Rosemead Inn, we believe that we can recapture business by having the first fairly priced boutique hotel in the San Gabriel Valley. There is a huge opportunity to capture a lion's share of the market due to the location of the Rosemead Inn adjacent to the freeway due to the fact it is the only freeway adjacent hotel along the interstate between Los Angeles and West Covina. The opportunity also presents itself to recapture Asian Tourism which is a large contributor to the local business. With the increase in Pacific Rim tourists due to the declining value of the dollar, loosening of travel restrictions, and continued development and immigration in the local area a destination orientated hotel is greatly needed in the area and the City. In the following sections we will introduce to you the Redevelopment and Repositioning concept we have as well as an introduction to the fastest growing segment of the hotel/hospitality industry, The Boutique Hotel. These hotels which are generally smaller in size, extremely focused on customer service, and have a design element which makes then unique are dominating an industry which have generally been controlled by larger mass produced giants with no attention to detail or to customer service. These hotels generally have greater occupancy statistics and room rates will definitely benefit the City as well as the surrounding community as well. II la II 0 0 REMODEL & REPOSITIONING CONCEPT Current The existing building is an early 1980's built 53 room hotel/motel originally operated as a Roadway Inn which was then converted to the non flagged independent Rosemead Inn. The Roadway Inn concept as well as the Rosemead Inn concept is/was a discounted lodging alternative, in fact the existing facility has not seen any sort of capital improvement since it's opening over twenty years ago. The property is currently in poor condition and is in desperate need of a complete renovation and repositioning. The last operator of the hotel liquidated all interior furnishings and left the interior in a depilated state. The assembled team of highly experienced professionals propose the complete interior and exterior renovation of the facility to extend its useful life and income generating abilities. The Subsequent re- branding shall then drive occupancy, revenue, and recognition to the hotel and to the City. Future INTIMATE PERSONALIZED STYLISH are what the Hotel Rosemead is to be! Consider stepping into a familiar lobby with a friendly greeting, a scent of fresh flowers, artwork from local artists, comfortable furniture, an easy going soundtrack playing in the background, and a concierge service to help you with every request. This is the destination hotel everyone will go to, this is the hotel everyone will talk about, this is Hotel Rosemead! Step into a deluxe room with resort furnishings, fresh linens, newly laid carpet, and all the comforts of home. Lets not forget to mention your complementary water and snacks. Your bathroom will be adorned with freshly laundered towels, bathmats, soaps and shampoos. As you wake in the morning and head out the breakfast bar don't forget to get your fresh coffee and a head start for your day ahead. We are here to cater to today's traveler, a more sophisticated and discerning traveler. More and more of the leading hotels of the world are adjusting their ways to accommodate these requests which only means Hotel Rosemead will be on the forefront of hospitality. We are a relationship based operation, we align our self with industries that share our vision of service and aesthetic to serve our core customer. We want our guests to feel connected to feel comfortable in today's fast paced world. 0 h Ir,Irr Y Welcome to ` ROSEM - EA.D HOTEL POSE-MEAD HOTEL POSE-MEAD 0 x NA wi �y I1 r? V ,hote I Kz s �1• R -1 RIO SNc'. II s - nf. r" rry M' II s - 0 0 Design Concept HOTEL ROSEMEAD 10 0 OPERATIONAL PROPOSAL PROPOSAL Rosemead Inn Hotel Partners LLC. (RIHP LLC.) (working name) and Rosemead Community Development Commission (RCDC) Rosemead Inn Hotel Partners LLC. (RIHP LLC.) proposes a two -year renewable contract period with the Rosemead Community Development Commission (RCDC) to Renovate, Rebrand, and Operate the shuttered Rosemead Inn located at 8832 Glendon in the city of Rosemead. The Renovation, Rebranding, and Operation of the Hotel will bring about numerous positive contributions to the City of Rosemead and the surrounding community including: I. Numerous Jobs Created II. Additional City Income through Bed Tax III. Renovation of a Blighted Shuttered Dilapidated Building — Reduced Crime IV. Occupancy will help Local Businesses — Increased Cash Flow throughout the City V. Positive Attention brought to the City Using the marketing plan included in this package and the combined strengths of the partners RIHP LLC. shall thoroughly remodel, re- brand, and operate the facility using a split of the net income as fee for the services rendered. Property: Ownership: Operator: Operational Term: Income Split: Ownership (RCDC) Contribution RIHP LLC. Contribution: Renovation Time: Income Distribution: Shuttered Rosemead Inn 8832 Glendon, Rosemead CA. Rosemead Community Development Commission Rosemead Inn Hotel Partners LLC. (working name) Minimum of Two (2) years from opening — renewable 50/50 of the net income $100,000 (renovation & initial operating budget) Renovation (interior & exterior), Marketing, Management Approximately 90 days from contract execution. Quarterly (four (4) times per calendar year) It is extremely critical that proper signage is given to the business to fully take advantage of its location and income generation possibility. As a partner the City of Rosemead and the Rosemead Community Development Commission is to do all that they can to help secure signage on the freeway and parking lot signs of the adjacent Levitz's property. An example of the requested signage is in the Design Concept section of this package. Income & Return Scenario As shown in the Income Matrix in this package to obtain the City's return on investment (ROI) of $100,000 an average of 60% occupancy at $50 a room in needed. Current Southern California Hotel occupancy is in the 70% + range at a price point higher than $50 per night (see Hotel Market Overview). 0 0 C N CL u 0 LL: e O o 0 0 0 0 0 0 0000 l0 1D 't N '+ O N Il O 10 00 01 tR VI to 4& 0 0 0 O c o. V LL; O 0 0 0 0 0000 0000 0 0 00 ID 00 IT N f- %6 O l0 W N N iff iPr iA V� 0 0 0 O O 0 0 0 O O °y O O O O M O O O 11 0 u m 0 0 0 O 00 N N O O O q O O O O 4) > E ti t\ n kD M Cl) (A E Ln � ID N iSci w.AiAV. v" IA +� M 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 O O O O O 00 7 N .-1 In O O O O O .-1 m In O 00 > O O O U) m Ol N m Ill 1� c Ol .i .y N u c Ill 00 Ol 10 r1 rl M a rl N .-1 V�1 � u u0 LL to to yr iA iA u LL +A Ll V4 M 0 O 0 coo 0 0 0 O O o 0 0 0 O M N 00 o m 1 u Ln t0 uol 0 0 ton .-I .ti m n N to n �' Ol n C7 m > v N m M 01 L E N L E M c Ou C O C U V} c U fA iA Vf Vf VI 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 t0 00 7 1< to �' O 1l 0o N ON m M m O c O m � N a c 0 ti C1 c ul o o ao O LL y} y} y} y} V} V 0 FR d} V! bF iA C LL ° O 0 0 0 O O 000 O M 0 0 0 O V O O O O 70 m Ill O O Ill I, m Ill O O Ill x y N N N N N N W V V m Ip > o E ., _ L oSu w«.AwiA o� o Li wwwia w E f 0 0 0 0 0 0 u° 0000 (1) elf, 0000 0 0 0 0 0 o o o 0 2: OIL tR Vi• tlT +Pr 3 w .A iA iA Of O 000 c o E c oo o c c 0 0 0 O VJ a-J U Y N 3 N 1`0 c 00 V w iA yr u m O O 00 ro U ~ ° a 0 0 E E O O yl O O O N O O O O O 0 m E== q- a, I" m E o c o cn y y y J CC .N1 N M 10/1 0 J OO H a ti N M V01 1 c IO a J u O LL O n N u c m a J u i 0 0 O n N h C 10 CL u u 0 LL 0 R m T T � ID � 3 n: c o u v c w CL V °Y' u M m O m u O O 00 n m V J 0 0 0 0 0 0 0 0 0 0 0 N tO O m m n n N Ln N N m m w w w w 000 0 O O O N Oct 00 ' O �+ N N t0 N N N ko w w wat w 0 0 0 0 0 0 0 0 0 O O O O O O N W OD M m V m Do O N NN N N N n w w w w w 00 0 0 0 ODD ON 00+ kD O W m Ln w w w w w 0 0 0 0 0 0 0 0 0 0 N 0 M m + 00 01 to m n OD 00 m N wwwww 0 00 0 00 vi o 0 ui m D D 00 .-i w w w w w 0 0 0 0 0000 o O O O ko n Go 0% wwww 0 0 0 0 0 0 m Ln w w w 0 0 u 0 O In E c 4 w m Y O N c 9 J O D' .+ N M �n F T V C 10 a J u o 0 O 01 N U u C 10 CL J u L 0 0 O rn N ? y r E c 0 0 V u G 10 CL u u o U: 0 0 rn m O1 3 c � o u �O c fo v 6 + u M N O °0m u 0 o O 0 al Y u J C) O O O O O O 0 0 0 0 6 00 y N %O N r, o m v N M O � N m v v w w w w 0 0 0 O O O O I O 000 0a 0 0 0 %0 o %0 Lf -i - OJ N N N W Ln w w w w w 0 0 0 0 0 0 0 0 0 0 0 0 0 0 O ar N ko m m m o m a m rl V lq N W N M M 01 wwww w 0 0 0 O 0 0 0 O Ln o o Ln O M m Ln N V V 1 N N N 1, w w w w w 0000 0 0 0 0 co M m m Go ww wv+w 0 O 0 0 ui o o vi 'D . . m 1l m m M N w w w w w 0 0 0 0 O O O O O O O O lO I� W T wwww O o 0 I O o O Ln w w w E n 00 O 0 V1 E 0 = C v Y Y v Y N N M N 0 0 Initial Capital Investment Exterior Description Budget Length Width Landscape $ 2,000.00 150 100 Power Wash and Paint $ 15,000.00 Sinage $ 8,000.00 Patch /Repair /Misc/ $ 3,500.00 Pool /new deck $ 5,500.00 Parking Lot $ - Front door focus pt. $ 2,000.00 Misc. $ 5,000.00 Remove /trash Canopy $ 580.00 Relocate entrance $ 3,000.00 Patio / Pool Furniture $ 1,200.00 Subtotal 45 780.00 Interior Description Budget LOBBY Furninshing $ 3,000.00 Focus pt. lighting $ 1,500.00 Paint and theme for reception an $ 4,000.00 Misc. $ 1,500.00 Elevator $ 700.00 Sound /speaker $ 800.00 Subtotal 1 1 $ 11500.00 length width Hallway 150 5 Carpet $ - Paint $ 4,500.00 Lighting $ 2,400.00 Subtotal 6,900.00 Rooms unit 53 Sand and paint Doors $ 75.00 $ 3,975.00 Paint $ 320.00 $ 16,960.00 Carpeting $ 600.00 200 sq.ft $ 31,800.00 0 0 Restroom Light and exhaust fans $ 175.00 $ 9,275.00 Faucets $ 200.00 $ 10,600.00 A/C service $ 50.00 $ 2,650.00 Refinish Curtains $ 80.00 $ 4,240.00 Sand popcorn ceiling. $ 50.00 $ 2,650.00 Subtotal: $ 1,550.00 Fumishing T.Vs 1 $ 100.00 Liens /towels $ 200.00 Pillows $ 300.00 Lamps $ 100.00 Desk $ 150.00 Bed Frame (250 single, 400 dou $ 375.00 Mattress (500 s, 800 double) $ 625.00 Drawers $ 150.00 Nightstands $ 80.00 Rug $ 100.00 Duvet/comforter 300s, 500 d $ 450.00 Mirror $ 40.00 Decor / Misc. $ 145.00 subtotal $ 2,815.00 Operations Uniforms $ 1,000.00 Robe for Rooms $ 800.00 Slippers $ 400.00 POS System / Computer $ 1,250.00 Cameras $ 1,500.00 Bell Cart $ 250.00 Hotel misc, shampoo, etc. $ 1,500.00 Name Tags $ 500.00 Wifi Service $ 1,500.00 Marketing Website $ 1,000.00 Sub total 1 1 $ 9,700.00 $ 82,150.00 $ 5,300.00 $ 10,600.00 $ 15,900.00 $ 5,300.00 $ 7,950.00 $ 19,875.00 $ 33,125.00 $ 7,950.00 $ 4,240.00 $ 5,300.00 $ 23,850.00 $ 2,120.00 $ 7,685.00 k= 0 Ext. $ 45,780.00 Lobby $ 11,500.00 Hallway $ 6,900.00 Rooms $ 82,150.00 Furnishing $ 149,195.00 Operations & marketing $ 9,700.00 Grand total $ 305,225.00 0 Expense Budget Operations 0 0 Yearly Monthly Utilites /cable/wifi $ 2,000.00 Employees 46,848.00 $ 2 housekeeping $ 3,840.00 2 desk/engineer $ 3,200.00 1 manger $ 5,440.00 1 night manger $ 2,720.00 1 marketing mgr $ 4,166.67 Landscaping $ 150.00 Pool $ 100.00 Liability Insurance $ 1,500.00 Misc. / Elevator Service $ 100.00 Trash $ 600.00 Linen Contract $ 500.00 Website $ 1,000.00 Placement on Travel Web Sites Misc. 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JANA is a privately owned commercial real estate investment and development company; the Company was founded in 1980's by Mohamed Seirafi and members of the Seirafi family. The Seirafi family has been involved in the acquisition, development and ownership of commercial real estate properties for over 20 years. Currently the Company owns a commercial real estate property portfolio with an estimated market value exceeding $30 million and properties in development exceeding $100 million. Mohamed Seirafi DBA MK JANA Enterprises has been in the commercial real estate industry for over 40 years. Starting off with Seirex "holding & operating company" for a chain of gasoline and service stations the company has made land acquisitions, developments, and sales for these stations. The number of these stations grew to over 30 until the last one was finally liquidated in early 2006. The Company acquires and develops multi-tenant commercial real estate properties throughout the Western United States and New York City. The Company's acquisitions . focus is on office, hotel/hospitality, retail and multifamily property types. One of the Company's greatest strengths is its ability to make a quick decision on an investment opportunity; this is possible because the Company is privately owned and its family controlled is able to act much more quickly than can a typical public company. Generally, the Company tends to acquire commercial real estate properties for a long- term holding period, thereby providing the Company with a stable revenue stream and equity for additional projects. Selectively, the Company disposes of properties when those assets are not deemed to be consistent with its long -term ownership goals. With the acquisition of other development parcels over the years the company has now started a new era of building and purchasing commercial income properties. These developments and investments now included office, medical office, retail, multi- family, hospitality, custom estate communities, and senior housing. With over 400 multi- family units owned and/or under construction and various other retail developments also underway Mohamed Seirafi / MK JANA Enterprises is continuing to grow and build it's portfolio of privately owned quality investment real estate. The Company is headquartered in Hacienda Heights, California (15 minutes from downtown Los Angeles). It is staffed by a team of industry professionals with substantial expertise in commercial real estate acquisitions, development, finance, investment banking, and asset management. 0 0 PROPERTY PLAZA DEL ESTE LOCATION 16388 E COLIMA RD., HACIENDA HEIGHTS, CA TYPE OF PROJECT 19,500 S.F. OFFICE/RETAIL BUILDING COMPLETION DATE DEVELOPED 2004 SUMMARY Located in the San Gabriel Valley, Plaza del Este was designed and built to reflect the Southern California look and image of the Spanish Mission type architecture. Plaza del Este serves the community by providing professional retail space to business owners and their clientele in a destination orientated development. Built in 2004/2005 of structural steel, concrete block, and wood framing, the building meets and exceeds standard building codes thus providing a efficient and safe working environment. 0 PROPERTY RIVERSIDE HOTEL 0 LOCATION LA SIERRA & INDIANA, RIVERSIDE, CA TYPE OF PROJECT UPPER MID SCALE HOTEL COMPLETION DATE COMMENCEMENT START 1Q 2009 SUMMARY Located along the Riverside/ Corona border the 80 room hotel will serve the underrepresented local communities. Along with underground parking, environmentally friendly construction, and the latest in hospitality technology. The Riverside Hotel will be a leader in the local Southern California Hotel market. E PROPERTY VALINDA PLAZA E LOCATION NWC VALINDA & MAPLEGROVE, LA PUENTE, CA TYPE OF PROJECT 6,000 S.F. RETAIL/ OFFICE BUILDING COMPLETION DATE LA COUNTY APPROVED CONSTRUCTION 2008 SUMMARY Scheduled to commence construction the summer of 2008, Valinda Plaza is a 6,000 S.F. retail development. Currently a spec. project it is already pre - leasing to the local community and businesses due to its location serving large residential areas of La Puente and West Covina. 1] PROPERTY ROSEWOOD APARTMENT HOMES LOCATION 5150 W EUGIE, PHOENIX, AZ TYPE OF PROJECT 152 UNIT/ 95,000 S.F. MULTIFAMILY COMPLETION DATE PURCHASED 2004 SUMMARY Representing one of the few purchased non developed properties, Rosewood Apartments was acquired from national developer Picerne from their core property portfolio. Representing the comer stone for the Southwest, Rosewood will enable the company's expansion throughout the sunbelt states. .moat" _ T Vill 0 PROPERTY GRAND DAMASCUS HOTEL LOCATION DAMASCUS, SYRIA 9 TYPE OF PROJECT URBAN INFILL MIXED USE RESORT DESTINATION COMPLETION DATE 2012- CURRENTLY IN DESIGN DEVELOPMENT SUMMARY Currently in the Design/Architecture stage the Grand Damascus Hotel is a 300 room mixed use Resort Hotel. Encompassing a full city block in the Thomas Gate neighborhood, situated just outside the walled old city of Damascus in the heart of the historical district. The resort will have multiple restaurants, retail shopping, travel services, a sky deck and beach club as well as a roof top bar. As the middle east continues at a 10 %+ annual traveler increase from European and Asian tourist. Projects and amenities of this kind are in high demand. 9 PROPERTY LA SIERRA VILLAGE 0 LOCATION LA SIERRA & INDIANA, RIVERSIDE, CA TYPE OF PROJECT 10 ACRE 260 UNIT SENIOR APARTMENTS & 30,000 S.F. RETAIL MIXED USE COMPLETION DATE CONSTRUCTION COMMENCEMENT 20 2009 SUMMARY Currently awaiting final approvals La Sierra Village is a 10 acre mixed used project located immediately off the 91 freeway in Riverside, California. This high end project is to include a 260 unit senior apartment component along with 25,000 S.F. of grand floor retail spread across 6 buildings. In keeping pace with environmental responsibilities La Sierra Village will be built, maintained, and operated with green materials and technology. Amenities include the adjacent Riverside Metro link Station, Kaiser Hospital and Tyler Mall located nearby as well as, retail, grocery store and hotel. e® Oe ®On -17a .a a0 m s I3 e 71 1011 110 I Ci�.ii�llr07� u 0 mi m fl iJ u 1 a D .W. O 10 r P.10 10 ;Na. ft BE 9 0 Qualifications / Team DAVID LY / CEMENTUM INC. David Ly is president of Cementum Incorporated, a leading, local, minority owned construction company that specializes in high end developments such as restaurants, condos, retail centers and multi family units. David is also one of the founders of Cementum's parent company JWL Associates which creates new and innovative architectural designs. Throughout his upbringing David Ly was surrounded by development projects that allowed him to develop his natural creative inclinations along with his business sense. Further traveling around the globe allowed him to explore and be inspired by key architectural landmarks throughout Europe and Asia. Consequently, after obtaining his Business Management degree, he dedicated himself wholeheartedly to the business industry with a strong affiliation to the untapped construction trade allowing him to expand in his two greatest talents. While working for Gold EDA International Property, LLC, David Ly involved himself in the renovation of the Hong Kong Plaza of over 200,000 square feet effectively managing to increase the market places' value by over $25 million. David stayed on to manage all of the Hong Kong Plaza throughout LA County for 5 years. Throughout this time he effectively managed over 100 employees. He honed his customer service skills with his clients, making sure to maintain high quality standards that would keep a steady clientele coming back to renew their good experience at the Hong Kong Marketplaces. He was able to perfect his managing systems by keeping strict inventory and giving steady maintenance to his property. With a passionate drive for leading the construction industry into a new level, he founded Cementum Inc. in order to create a one — stop company in which a client can nurture and expand their vision thereby making their dreams become a reality. David is currently expanding his construction vision towards higher environmental consciousness integration into his construction development projects while maintaining the clients' necessities in high priority. He makes this all happen from his strategically placed headquarters situated on Hacienda Blvd in Hacienda Heights. 0 0 Cementum is a privately owned construction company founded by David Ly in order to put his two greatest talents to use — his creative design and keen business sense. Based in Hacienda Heights, CA, the company itself is a customer — focused, team — centered and process — managed with the main goal of providing intelligent solutions to its clients in a timely and cost effective manner. The company provides excellent service by having the project managers and superintendents communicate constantly to discuss and continually improve the level of quality and speed. The Company started out by engaging in restaurant tenant improvements with first -time owners who were unfamiliar with the construction process. With a bit of patience and step by step guidance on Cementum's behalf, these clients were able to witness their business dream turn into reality in a matter of a few months in a comfortable and trusting environment. These same clients in turn have expanded their business and with their acquired knowledge turn to Cementum once again in order to focus more on design and quality to produce trendier, higher end establishments. In order to provide the finest project possible Cementum works with distinguished architecture firms such as award winning Akaar Studios with the first opening of Seoul Bros in Pasadena, Nottoscale in the innovative Clear Optometry store in San Mateo, and the prestigious Valerio Architects firm with the trendy Amanda's Restaurant located in Berkeley. These architecture firms, among others complement the quality work that Cementum delivers to their clients, while rapidly continuing their clients' business expansion or development. JWL Associates LLC is local, privately owned architectural and engineering design company engaging in a variety of development projects including but not limited to retail, residential, multi -family homes, condos, restaurants and marketplace plazas. The company is lead by experienced engineers and architects that have over 25 years of experience in complex and high end developments both for private and public works. Their numerous young employees offer their fresh, new talent that is nurtured and guided by their superiors resulting in functional but modem designs. Their offices are located in Hacienda Heights on Hacienda Blvd. 0 0 PROPERTY Amanda's Restaurant LOCATION Berkeley, CA TYPE OF PROJECT Tenant Improvement of Historical Landmark COMPLETION DATE July 2008 COLLABORATORS Valerio Architects T r--m a �j . I' m Ps! 0 lb wid i a WD � � t •i :w 1 � 0 PROPERTY Hong Kong Plaza LOCATION West Covina TYPE OF PROJECT New Construction r' FROM, F7 1025 0 J I rq!!lml :� ©oo , ©000 965 r 957 J \ y 955 d b oe7 -... If I 943 N JJ ° M 0 839 �ifllllllllljlj� w C) W 935 Glendora Avenue Vine St HONG KONG PLAZA OF WEST COVINA 935 -1029 S. Glendora Ave. West Covina, CA 91790 ,1 .i _FOR:- tip ..er Mentor Condominiums Pasadena, CA New Construction condos - E 0 E MANAGEMENT PROPOSAL for ROSEMEAD INN 8832 GLENDON WAY CITY OF ROSEMEAD, CALIFORNIA GRAND INN, INC. 8711 VALLEY BLVD ROSEMEAD, CA 91770 1 GRAND INN, INC. 8711 VALLEY BLVD ROSEMEAD, CA 91770 Date: August 1, 2008 City of Rosemead Rosemead, California Re: Hotel Management Proposal To Whom It May Concern: Grand Inn, Inc. is pleased to submit this request for your review. We look forward to your cooperative efforts to build our management and landlord relationship. Our proposal requests the opportunity to manage Rosemead Inn located at 8832 Glendon Way, City of Rosemead, State of California. For the last ten years, our management team has successfully managed quite a few hotels in Southern California. Thank you for your interest in Grand Inn, Inc. We envision building upon our collaborative success by managing Rosemead Inn with you. Sincerely, Roy Ying President 2 u 0 ROSEMEAD INN MANAGEMENT PROPOSAL I. Primary Service Grand Inn, Inc. is a full management service company for the hotel industry. We combine our extensive experience and knowledge gained through experience in hotel management. We proudly own and operate the following Southern California motels, Win All E -Z Inn in E1 Monte, Valley Hotel in Rosemead and Grand Inn in Fullerton. II. Company Background We possess a reputation of excellence within the hotel industry. We have gained the reputation by being true to our mission statement of providing quality products and service to our guests through attention to detail, integrity, pride and intensity in all aspects of operation. We put a lot of focus, energy and effort into the shaping of our properties and have thus maintenance their continued success. We are so confident in our ability to deliver results that we are willing to structure according to agreements and to demonstrate the results we produce. III. Description of our team our President, Roy Ying, has over 10 years of experience and has trained by the Howard Johnson franchise program. In 2007, he received the best member of the year award from Southern California Hotel and Motel Association. 3 • Our team is an extensively experienced group. Our senior managers carry over 10 years experience, while our junior staffs have more than 2 years experience. We have maintained substantial relationships with third parties such as travel agencies, insurance companies, hotel supply companies, maintenance and repair companies. IV. Issues and Problems We have inspected Rosemead Inn, and find the property need a lot of renovations in order to resume normal business operations. This includes painting of the building, replacing sign, repairing electrical equipments, lighting system changing, fixing air conditioners, replacing fire extinguishers, replacing security system and changing hallway carpets. Not only do we have exterior repair, but also we will provide each room with furniture, television, lighting, carpet, remodeled bathroom. The estimated renovations and maintenance is around $200,000 (detail see Exhibit 1). V. Illegal business and Long term lease Under California Law, we reserve the rights to refuse any person who is doing illegal business, such as prostitution, narcotics, gang activity, etc. on the property. In order to avoid any lawsuit with tenants during the term of agreement, we will not accept any long term stays. Our main concern is to keep the property clean, quiet and safe. 4 0 0 VI. Mutual benefits We hereby propose to manage Rosemead Inn for the City of Rosemead: regardless of profit or loss, we will pay the City $5,000 per month in the first year; $10,000 per month in the second year and $15,000 per month then after. We will pay all expenses related to daily operation, which includes wages, repair, utilities, etc. We will also provide both property and general liability insurance. For our mutual benefits, we will incur the initial capital expenses in the amount of $200,000. It will take six months to renovate. Payment schedule will begin after the six month renovation. VII. Termination As long as Rosemead Inn continues to operate as a motel, we will have the priority to be the managing company of the property providing that we maintain solid payment schedule. Three months advance notice to terminate the agreement is required from either party. EXHIBIT 1 0 The estimated of each room is $2500.00. The detail is as followings: Carpet: Furniture: Television: Supplies: Bath Tub: Lights: Room Painting: $500.00 x 53 = $26,500.00 $700.00 x 53 = $37,100.00 $200.00 x 53 = $10,600.00 $200.00 x 53 = $10,600.00 $300.00 x 53 = $15,900.00 $100.00 x 53 = $ 5,300.00 $500.00 x 53 = $26,500.00 Total: $132,500.00 Replace 25 Air Conditioners $ 12,500.00 Exterior Remodeling $ 55,000.00 Grand Total: $200,000.00 3 0 0 i .7 i ,l W� 5: N t Z � Z = `a V ' w� 0 0 O O a� t�? o u a° 0 n U tt � tt y tt cry, �1 0 a a m o W�� GC Z G N r