Description

The property is projected to trade at an 8.0% capitalization rate based on 2025 NOI performance, offering investors the opportunity to acquire a cash-flowing hospitality asset with strong upside potential and multiple value-add opportunities. There is potential to convert the existing meeting room—currently accommodating up to 60 guests—into four additional guest rooms, enhancing capacity and revenue. The sale also includes a waterfront parcel directly across from the hotel, presently used as a private deck and shared amenity for guests. This space presents an opportunity to develop a tiki bar, adding a unique and desirable food and beverage component for both guests and island visitors. The hotel’s prime location and status as the only traditional lodging option on Kelleys Island also create a compelling opportunity to expand into the wedding and events market. Its scenic waterfront setting and private dock access make it an attractive venue, which could substantially increase both revenue and profitability. As a seasonal operation open approximately six to seven months per year, the property commands premium in-season rates. For 2025, room revenue is projected to exceed $1,100,000, representing approximately $195 RevPAR across just 31 rooms. The offering is priced significantly below replacement cost, as current construction costs for a comparable island property are estimated to exceed $12 million due to escalating material and labor expenses. This property stands as Kelleys Island’s only hotel/resort, offering a distinctive market position with virtually no direct competition. The island’s other lodging options consist mainly of small bed-and-breakfasts that cannot match the hotel’s scale or amenities. The property is absentee-owned and operated by a professional third-party management company. Buyers may choose to retain the existing operator or assume ownership unencumbered by a management agreement. The resort features a diverse mix of spacious units averaging more than 620 square feet each, with every suite including a private patio overlooking the pool, hot tub, and lake. Kelleys Island’s compact size and limited lodging inventory create a high-barrier-to-entry market that allows the resort to capture a large share of visitors seeking upscale accommodations. Located on the island’s south shore, the property offers panoramic views of Lake Erie, Marblehead Peninsula, and Cedar Point. Accessible only by ferry, boat, or plane, the island provides a unique and exclusive experience. Most guests arrive via the Sandusky Ferry, which runs multiple daily trips during the tourist season. The resort also benefits from its position within the Lake Erie Shores & Islands region—a well-established tourism destination with consistently high visitor activity.