Separated engines · fact vs model · Jul 2026
Is monthly residence the best play?
Yes — and here is the bankable math.
Four engines: hotel (residences) · restaurant (CRAVE kitchen licenses) · bar (owner ops) · court. Wellness chairs = killed. Every dollar is tagged FACT (published or contract) or MODEL (disclosed assumption) or BANK EXCLUDES until proven. Start credit at the lender door.
Verdict: On a 100′×110′×5 plate with ~$3.5M capital, luxury residences are the core bankable income. Restaurant base licenses add contractual rent. Bar is real upside — banks usually will not underwrite it until you have liquor ops history. That is the precise stack: finance the hotel + kitchen base; operate the bar for equity.
1 · Why residences are the best play (for this deal)
| Test | Why residences win | Proof type |
|---|---|---|
| Fits the plate | 56 keys locked on 100×110×5 (14/floor × L2–L5) — same geometry as steel RFQ | FACT layout lock |
| Occupancy premium | US residence occupancy ~72.7% Q4 2024 vs metro hotel ~64.6% YE 2024 | FACT Highland · Newmark |
| Rent vs corridor apts | Mirage $2,400 / $3,400 all-in (one invoice) vs Windsor/Calypso bare ~$1,755 / $2,175. Loaded short-stay comps ≈ $2,150–$2,420 (1BR) · $2,660–$2,950 (2BR) after util + furniture. Full ladder: decide · true cost | FACT Windsor · Calypso · MODEL util band |
| Exit buyers | Harvey Best Western Plus Westbank (1700 Lapalco) traded $8.275M / 138 keys — proves hospitality capital closes in parish; Mirage is new residences + CRAVE, not a Lapalco select-service comps stack | FACT Canal Street Beat / M&M |
| Debt underwriting | Rent roll of guest rooms is standard hospitality collateral; bar is a business | FACT lending practice |
1b · What’s actually backed by data
| Piece | Status | Verdict |
|---|---|---|
| Corridor traffic ~45k VPD | Compass · NAI · SRSA · Stumpf band; LaDOTD PDF pending | Strong — cars are there |
| US residence-sector occupancy ~72.7% | Highland US residence-occ benchmark Q4 2024 · vs hotel 64.6% Newmark | Strong national floor — bank case. Tourist metro + minutes to CBD/FQ = partner stack runs higher |
| NOLA tourism + proximity | 19.08M visitors · $10.4B spend (2024). Harvey ~10–20 min to CBD / French Quarter | Fact — tourist city · stack above inland residence-sector averages |
| Apt comps · Windsor / Calypso | Bare ~$1,755 / $2,175 · true-cost on decide | Fact — housing clears money |
| Parish hospitality capital | BW Plus Lapalco ~$8.275M / 138 keys | Fact — hotels trade here (different product) |
| Kitchen landlord model | Food-hall / ghost-kitchen · base + % on house POS | Structure real; 6 LOIs = execution |
| $26k P&I on ~$3.5M | Owner mortgage case · DSCR on full stack ~5.8× | Math fine if NOI hits |
Credit use: underwrite bank core from published facts + kitchen base leases at Highland 72.7%. NOLA is a tourist city (19.08M visitors) and Harvey is ~10–20 min to CBD / French Quarter — that is why the sponsor case stacks higher (90% · bar · court). Treat stop %, bar, and court as upside until T12 / LOIs.
2 · Stabilized monthly — three engines separated
Two columns on purpose. Bank core = what a conservative credit memo can defend with public data + signed contracts. Sponsor = full operating case from the investor deck, clearly marked where proof is still needed.
| Engine | Bank core $/mo | Sponsor $/mo | How calculated · can they prove it? |
|---|---|---|---|
| A · HOTEL · 56 Mirage Residences · 48×610 + 8×850 | |||
| Gross potential rent @ 100% | $142,400 | $142,400 | FACT 48×$2,400 + 8×$3,400 · owner rent schedule lock |
| Occupancy | 72.7% | 90% | FACT Bank: Highland US residence-occ benchmark Q4 2024 · 72.7%. MODEL Sponsor deck used 90% — optimistic until local STR proof |
| Effective gross (EGI) | $103,525 | $128,160 | GPR × occ |
| residence opex | −$39,340 | −$49,250 | MODEL 38% of EGI (HK · utilities · mgmt · reserves). Bank will want a line-item operating budget |
| Hotel NOI | $64,185 | $80,350 | Before debt. Bank primary engine. |
| B · RESTAURANT · CRAVE · 6 kitchen licenses · corridor traffic model | |||
| Corridor food sales (research) | — | $229,950 | VPD FACT 45,000 cars × 0.30% stop × party 2 × $28 check × ~30.4 days. Full funnel on facts-5yr-proforma.html. Stress 0.15% → $114,975 · Upside 0.50% → $383,250 |
| Base license rent | $9,000 | $9,000 | FACT structure: 6×$1,500. MODEL until signed chef LOIs |
| 15% of whatever kitchens bring in (POS) | $0 | $34,492 | STRUCTURE Mandatory house POS. 15% × $229,950 traffic base = $34,492. Settles on actual POS volume |
| Shared BOH / grease support | −$8,000 | −$8,000 | MODEL owner ops budget |
| Restaurant NOI | $1,000 | $35,492 | Bank = base − BOH only (won’t take % until T12). Sponsor / partner story = traffic research · ~$35.5k NOI. Stress capture still ~$18.2k after BOH. Why kitchens → |
| C · BAR · owner-operated · one liquor license · why we keep it | |||
| Bar gross | $0 | $95,000 | MODEL sponsor Likely ops case — not a third-party rent |
| Bar COGS + payroll (~55%) | — | −$52,250 | MODEL |
| Bar NOI / contribution | $0 | $42,750 | BANK EXCLUDES until liquor license + T12 / comps. Equity keeps it because food-hall bar gross margins (~65–80%) dwarf food (~30–45%) — leasing the bar is the category mistake. Full thesis → |
| D · COURT · 5,500 SF outdoor · programming | |||
| Court gross | $0 | $12,000 | MODEL sections · watch nights · brunch pkgs |
| Court ops | — | −$3,000 | MODEL |
| Court NOI | $0 | $9,000 | BANK EXCLUDES until programming track record |
| TOTAL NOI · stabilized / mo | $65,907 | $151,427 | Bank ≈ hotel @ 72.7% + kitchen base (~$66k). Partner lock = keys $64,185 + CRAVE $35,492 + bar $42,750 + court $9,000 = $151,427. Keys+CRAVE only = $99,677. |
| TOTAL NOI · / yr | $790,884 | $1,825,788 | Before debt service · insurance escalations · taxes |
CRAVE sponsor case: Corridor model (45k VPD · 0.30% stop) → ~$230k food sales / mo → Mirage kitchen income ~$43.5k → NOI ~$35.5k. Bank column underwrites base licenses only until POS history exists. Full funnel: facts-5yr-proforma.html.
2a · Rooms underwriting frame (bank core)
Credit language we use: Rooms get standard lodging ratios — occupancy, room revenue, % of revenue, POR (per occupied room) and PAR (per available room) — on a 30-day lease basis. Not a franchise night-stay ADR story. Bar, kitchen percentage rent, and court stay outside this frame until contracted. Local market proof = Westbank STR / CoStar competitive set (§5).
| Rooms · bank case · Highland residence-occ benchmark 72.7% | $/mo | % of EGI | POR | PAR |
|---|---|---|---|---|
| Keys · rooms available | 56 | ~40.7 occupied @ 72.7% | ||
| Blended scheduled rent (all-in · 30-day) | $2,571 | — | $2,571 | $2,571 |
| Effective gross (EGI) | $103,525 | 100% | $2,571 | $1,869 |
| residence opex (staff + util + insurance + reserves) | −$39,340 | 38% | −$977 | −$710 |
| Hotel NOI | $64,185 | 62% | $1,594 | $1,159 |
POR / PAR = monthly dollars ÷ occupied keys (~40.7) or ÷ 56 available. Line-item detail of the 38% stub (lean residences — weekly HK, not full-service nightly): labor loaded ≈ $20.3k (desk · HK · maint · night · GM overlay) + non-labor ≈ $17.6k (util · PMS · insurance · supplies · marketing · repairs · FF&E) = ~$37.9k inside the $39,340 stub (~$1.9k cushion). Full stack + $26k mortgage: investors deck § staff.
Does not kill the play: employee budget is the breakdown of opex already in NOI — not an add-on. Bank still sees hotel NOI $64,185; partner full stack after $26k mortgage still ≈ $125k/mo.
$65.9kBank NOI / mo · base only
$100.4kKeys + traffic CRAVE · no bar
$158.6kSponsor · 90% keys + traffic + bar
2b · Wellness / beauty chairs — KILLED
Former option: half of Floor 2 → 40 chair licenses @ $225/wk. Removed from the program.
Verdict: NO — kill it. Paper swap vs ~7 keys looked +$14k–$25k/mo, but filling 40 operators in Harvey is a second lease-up on a one-shot loan. Rate (~$225/wk) can be fine in big metros; count does not make sense here. Keep all 56 residence keys. No wellness in bank or sponsor core.
3 · 5-year pro forma · engines split
Ramp: Y1 70% · Y2 90% · Y3–Y5 100%. Rates +2%/yr. Same three engines — no bar in bank column.
Bank core (hotel @ 72.7% + restaurant base $9k only)
| Year | Hotel NOI | Restaurant base | Bar | Total NOI |
|---|---|---|---|---|
| Y1 | $545,215 | $108,000 | $0 | $653,215 |
| Y2 | $715,011 | $110,160 | $0 | $825,171 |
| Y3 | $810,345 | $112,363 | $0 | $922,709 |
| Y4 | $826,552 | $114,610 | $0 | $941,163 |
| Y5 | $843,083 | $116,903 | $0 | $959,986 |
| Y1–Y5 sum | $3,740,206 | $562,036 | $0 | $4,302,244 |
Restaurant shown as base license cash to Mirage before BOH for simplicity in the multi-year table; credit memo should run BOH inside OpEx. Cumulative bank NOI ≈ $4.3M on ~$3.5M capital before debt.
Sponsor case (hotel @ 72.7% + rest w/ 15% + bar) — not bank default
| Year | Hotel NOI | Restaurant NOI | Bar contrib. | Total NOI |
|---|---|---|---|---|
| Y1 | $545,215 | $301,737 | $359,100 | $1,206,052 |
| Y2 | $715,011 | $392,209 | $470,934 | $1,578,154 |
| Y3 | $810,345 | $443,117 | $533,725 | $1,787,187 |
| Y4 | $826,552 | $451,979 | $544,400 | $1,822,931 |
| Y5 | $843,083 | $461,019 | $555,288 | $1,859,390 |
| Y1–Y5 sum | $3,740,206 | $2,050,061 | $2,463,447 | $8,253,714 |
Do not lead a bank with the sponsor column. Lead with bank core (~$791k NOI/yr stabilized). Show sponsor as equity promote after license LOIs + liquor plan.
4 · Stress case (if bank uses metro hotel occ)
| Case | Occ | Hotel NOI/mo | + Rest base | Bank total / mo |
|---|---|---|---|---|
| Stress · Newmark NOLA hotel YE 2024 | 64.6% | $57,675 | $9,000 | $66,675* |
| Likely · Highland residence-occ benchmark Q4 2024 | 72.7% | $64,185 | $9,000 | $73,907* |
| Strong · Highland residence-occ benchmark Mar 2025 | 74.4% | $66,424 | $9,000 | $75,424* |
*Before BOH support. After −$8k BOH: Likely bank total ≈ $65,907/mo.
5 · What investors & the bank still need (precise list)
Must-have before term sheet
- LaDOTD AADT PDF — station nearest 1705 Manhattan (replace broker 42–46.2k band)
- STR / CoStar comp set — Westbank + airport limited-service / residence properties (occ, ADR, RevPAR) — not just Newmark metro
- Signed kitchen LOIs — 6 chefs at $1,500 base + mandatory house POS + 15% of gross POS sales
- OpEx quotes — confirm the sketched staff/util lines inside the 38% stub (~$37.9k of $39.3k) with local bids
- GC / steel bids — proof $3.5M all-in is executable (RFQ responses)
- Sources & uses + draw schedule — land $435k + locked lean hard + soft + contingency · steel ≤$1.0M
- Insurance quotes — wind / named storm / liability for mixed-use + A-2 kitchen
- MAI engagement letter — as-complete + as-stabilized scopes
Makes bar / override bankable later
- ATC liquor license path memo — timelines, entity, separation from kitchen licenses
- Bar pro forma with comps — 3 Westbank / West End bar or hotel-lobby F&B sales comps, not vibes
- POS history or franchise package — after open, 6–12 months for refinance
- POS + audit clause — house system only; 15% of whatever they ring, reconcilable weekly
- Environmental / Phase I — grease interceptor / prior site uses
- ALTA survey + title — current, not draft
- Parish pre-app written notes — MU-CD parking / hotel item confirmation
- Market study (brief) — residence demand from hospitals, contractors, insurance rehabs on Westbank
6 · Undeniable source index
| Claim | Number | Source |
|---|---|---|
| Program keys / rents | 56 · $2,400 / $3,400 | Owner layout lock · Rev J |
| US residence-sector occupancy | 72.7% Q4 2024 | Highland Group (Asian Hospitality coverage + ESLA bulletin) |
| NOLA hotel occupancy | 64.6% YE 2024 | Newmark Hotel Market Nsights PDF |
| Windsor at Manhattan (Harvey) highs | 1BR ~$1,520–$1,595 · 2BR ~$1,905 | Apartments.com / ForRent / HotPads listings |
| Calypso Bay (Gretna) highs | 1BR ~$1,580–$1,755 · 2BR ~$1,985–$2,175 | Apartments.com / Apartment Finder listings |
| Higher of stack (only cite) | ~$1,755 1BR · ~$2,175 2BR | Max(Windsor, Calypso) by class — not market averages |
| Typical add-ons (Westbank band) | Util/net/ins ~$245–$415 (1BR) · ~$285–$480 (2BR) · furniture short-stay ~$150–$300 | MODEL band — Entergy / Cox / renter ins / furniture rental substitute |
| True furnished short-stay (comps + add-ons) | ~$2,150–$2,420 1BR path · ~$2,660–$2,950 2BR | Bare high + util band + furniture — see decide · true cost |
| Mirage all-in (one invoice) | $2,400 · 610 SF (≈$80/nt) · $3,400 · 850 SF (≈$113/nt) | Furniture · util · Wi-Fi · parking · fitness · pool · 30-day — vs bare apt rent |
| Corridor VPD band | 42,000–46,200 | Compass 1705 · NAI Rampart · SRSA · Jack Stumpf (LaDOTD pending) |
| Harvey BW Plus Westbank sale | $8.275M · 138 keys · ~$59,964/key | Canal Street Beat / M&M listing |
| NOLA visitation | 19.08M · $10.4B (2024) | New Orleans & Company / MMGY |
| Capital | ~$3.5M all-in | Owner ask · land $435k locked · steel GATE ≤$1.0M |
| Land corridor ask (listed · not sold) | 1901 Manhattan $14.70M / 22.5 ac ≈ $653k/ac | LACDB · LoopNet · same ~$/ac band |
| Subject land basis | ~$435k UC on 2.2 ac ≈ $198k/ac (MLS ask ~$500k) | vs 1901 $/ac → ~$1.44M implied · ~$1.0M under list rate — valuation |
One sentence for the bank: Underwrite ~$66k–$74k/mo NOI from residence rents roll at published residence occupancy plus six kitchen base licenses; treat bar and percentage rent as sponsor upside until leases and liquor ops are documented.
Investor deck CRAVE kitchens + bar thesis residences thesis · vs BW Plus