Branded Hotel Leasehold
For Sale
Contact for pricing
200 West Palmdale Boulevard, Palmdale, CA 93551
Acquire an 85-room Red Roof Inn leasehold with a manager’s apartment and remaining ground lease.
Property Size29,488 SF
Price / SF$152.60
Days on Market56
Property Features for 200 West Palmdale Boulevard
General Information
Standard status
Active
Size
29,488 SF
Property subtype
Hospitality
Additional Details
Business Included
Yes
Building Details
Year Built
1986
Stories
2
Listing Agency:
Apex Lodging Advisors
Listed By:
Shane (Sanjay) Patel · License #CA DRE# 01708267
Source:
Crexi
Added: Jun 17
Changed: Aug 8
Last Checked: Aug 10 at 1:45PM
Displayed information is deemed reliable but is not guaranteed and should be independently verified. All listing content including descriptions, pricing, images are the copyrighted material of Apex Lodging Advisors
Investment Insights
Based on property information with market context.
Apex Lodging Advisors presents the opportunity to acquire the leasehold interest and operating business of the Red Roof Inn Palmdale, a branded hotel with 85 rentable guest rooms. The offering also includes a manager’s apartment and additional bonus rooms that may be converted into revenue-generating guest accommodations. The sale includes the hotel improvements, with no fee simple ownership of the underlying land.
Located in Palmdale, California within Antelope Valley, the property is described as being positioned in a Southern California aerospace and defense market. The hotel operates under the nationally recognized Red Roof Inn flag and is noted for convenient access to major transportation corridors and employment centers.
This is a leasehold-focused acquisition for an owner-operator or buyer seeking to manage a branded lodging asset with more than 30 years remaining on the current ground lease. With an established room base and on-site space identified as convertible to additional guest accommodations, the property supports a practical path for operational oversight and potential room configuration changes within the existing hotel framework.
Located in Palmdale, California within Antelope Valley, the property is described as being positioned in a Southern California aerospace and defense market. The hotel operates under the nationally recognized Red Roof Inn flag and is noted for convenient access to major transportation corridors and employment centers.
This is a leasehold-focused acquisition for an owner-operator or buyer seeking to manage a branded lodging asset with more than 30 years remaining on the current ground lease. With an established room base and on-site space identified as convertible to additional guest accommodations, the property supports a practical path for operational oversight and potential room configuration changes within the existing hotel framework.
Key Highlights
- 85‑room branded hotel operating under the Red Roof Inn flag
- Leasehold sale includes all hotel improvements; underlying land fee simple ownership is not included
- More than 30 years remaining on the current ground lease
Financial Insights
Estimated NOI and Cap Rate
NOI = area × lease_rate × (100 − vacancy) / 100 × (1 − expense_ratio). Net Operating Income — what the owner takes home each year before mortgage payments and income tax. Effective rent (asking rent minus vacancy losses) minus operating costs (taxes, insurance, maintenance, management).
NOI / Yr
$184,890
Cap rate = NOI / list price × 100. Capitalization rate — annual return on a fully cash purchase, before financing. NOI divided by price. Higher means more income per dollar invested, but usually also more risk or older condition. 5–8% is typical for stabilized commercial property; double digits often signal distressed deals.
Cap Rate
4.11%
Suggested Prices Based on Cap Rates
Cap rates vary significantly by property type, market, and asset quality.
Typical U.S. stable-market ranges:
Multifamily — 4.5% to 6.5% (Class A in primary markets often sub-5%; Class C in secondary markets 6%+)
Industrial / Logistics — 5.0% to 7.0% (compressed heavily in recent years due to e-commerce demand)
Office — 6.5% to 9%+ (wide spread post-2020; CBD Class A vs. suburban Class B varies dramatically)
Retail — 5.5% to 8.5% (grocery-anchored on the low end, unanchored strip centers higher)
Hospitality / Hotels — 7.5% to 10%+ (higher due to operational risk)
Self-Storage — 5.5% to 7.5%
Medical Office — 6.0% to 7.5%
Net Lease (single tenant, credit) — 5.0% to 7.0% depending on tenant credit and lease term
Rules of thumb:
Primary markets (NYC, SF, LA, Boston, DC) trade at lower cap rates than secondary/tertiary markets, often by 100–200 bps (bps, aka basis points; 1 bp = 0.01%).
Class A assets trade ~50–150 bps tighter than Class B, and Class B tighter than Class C.
Cap rates move inversely with price — a lower cap rate means a higher price for the same NOI.
Spread to the 10-year Treasury is a common benchmark; historically 200–400 bps over the 10-year.
Cap Rate 5%
$3,697,800
$3.7M
Cap Rate 7%
$2,641,286
$2.6M
Cap Rate 9%
$2,054,333
$2.1M
Market Conditions
NOI Build-Up for 29,488 SF
Vacancy — income lost from leasable area expected to sit empty during the year, subtracted from gross rent.
EGI (Effective Gross Income) — gross rent minus vacancy losses, the realistic income before paying operating costs.
OpEx (Operating Expenses) — recurring costs to operate the property (property tax, insurance, utilities, maintenance, management); excludes financing and capital improvements.
NOI (Net Operating Income) — income a property generates after operating costs but before financing and taxes.
Gross rent
$442.3K $15.00/SF
− Vacancy
−$53.1K −$1.80/SF
EGI
$389.2K $13.20/SF
− OpEx
−$204.4K −$6.93/SF
NOI
$184.9K $6.27/SF
Area
Palmdale, CA
Vacancy
12.00%
Lease Rate
$15.00 /SF/Yr
Expense Ratio
52.50%
Simulate Cap Rate and NOI
Suggested Prices Based on Cap Rates
Cap rates vary significantly by property type, market, and asset quality.
Typical U.S. stable-market ranges:
Multifamily — 4.5% to 6.5% (Class A in primary markets often sub-5%; Class C in secondary markets 6%+)
Industrial / Logistics — 5.0% to 7.0% (compressed heavily in recent years due to e-commerce demand)
Office — 6.5% to 9%+ (wide spread post-2020; CBD Class A vs. suburban Class B varies dramatically)
Retail — 5.5% to 8.5% (grocery-anchored on the low end, unanchored strip centers higher)
Hospitality / Hotels — 7.5% to 10%+ (higher due to operational risk)
Self-Storage — 5.5% to 7.5%
Medical Office — 6.0% to 7.5%
Net Lease (single tenant, credit) — 5.0% to 7.0% depending on tenant credit and lease term
Rules of thumb:
Primary markets (NYC, SF, LA, Boston, DC) trade at lower cap rates than secondary/tertiary markets, often by 100–200 bps (bps, aka basis points; 1 bp = 0.01%).
Class A assets trade ~50–150 bps tighter than Class B, and Class B tighter than Class C.
Cap rates move inversely with price — a lower cap rate means a higher price for the same NOI.
Spread to the 10-year Treasury is a common benchmark; historically 200–400 bps over the 10-year.
Cap Rate 5%
$3,697,800
Cap Rate 7%
$2,641,286
Cap Rate 9%
$2,054,333
Alternative Uses
Best Use
Hotel Hospitality
$2.64M
$2.31M – $3.08M
NOI $184,890 @ 7.0% cap · market cap 4.11%
Second Best
—
—
no second resolved use
Theoretical Best
Office A
$12.45M
$10.89M – $14.53M
NOI $871,561 @ 7.0% cap · market cap 19.37%
Zoning and permitted uses should be independently verified with authorities.
Property Analytics
Property Profile
Current Use
Lease Details
Turnkey business
Opportunity
Location Intelligence
Trade Area within ½ mile
1,041
Businesses Nearby
Explore this area
Business Placement
Demographics for 93551, CA
56,001
Population
17,940
Households
3.1
Avg Household Size
38
Median Age
30%
College-Educated
87%
High-School Grad
84.8 sq mi
ZIP Area
660
Density / Sq Mi
$110,850
Median Household Income
$55,882
Median Earnings
$2,263
Median Rent
$548,800
Median Home Value
Questions? Ask Rey
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Frequently Asked Questions
What type of property is this?
Hotel - Acquire an 85-room Red Roof Inn leasehold with a manager’s apartment and remaining ground lease.
Where is this hotel located?
The property is located at 200 West Palmdale Boulevard Palmdale, CA.
What is the asking price?
The asking price for this property is $4,500,000.
What are key features of this property?
This property features: 85‑room branded hotel operating under the Red Roof Inn flag; Leasehold sale includes all hotel improvements; underlying land fee simple ownership is not included; More than 30 years remaining on the current ground lease
