The Mandate
A rural hospitality sponsor combining an event venue with cabin lodging on a rural parcel outside Bozeman engaged Feasibility Study Consultant to prepare a third-party feasibility study supporting a USDA B&I financing request for a project located in Gallatin County, Montana. Total project capitalization fell within the $5M-$10M band. The capital provider, a rural community bank with USDA B&I guarantee, required documentation consistent with current program review standards. The analytical question put to the team: Could destination-wedding demand and Yellowstone-corridor leisure lodging demand jointly support 16 cabins and a 32-date event schedule.
Engagement Scope
- Primary market area defined as a national origin-market drive-time
- Comparable supply set of 7 properties
- Demand model framework: blended destination-wedding and leisure room-night demand model
- Financial projection horizon: 10 years
- Site inspection completed; operator interviews where applicable
- Primary data collection through field reconnaissance and third-party market data
Methodology Applied
Primary Market Area
The PMA was defined as a national origin-market drive-time from the subject site, calibrated to the demand catchment behavior typical of wedding venue assets in Montana. The boundary captured the population, employment, and competitive supply base relevant to the subject's operating thesis.
Supply and Demand Reconciliation
The comparable supply set comprised 7 properties operating within the PMA or in directly substitutable submarkets. Demand was modeled using a blended destination-wedding and leisure room-night demand model approach over a 10 years horizon. The reconciliation tested whether incremental supply, including the subject, could be absorbed within the projection window without compromising stabilized occupancy assumptions.
Capture Rate Calibration
The subject's capture rate was calibrated against the absorption capacity of the PMA. The analysis concluded that PMA absorption capacity exceeded subject build-out by a factor of 2 across the projection window, with a stabilized capture rate of 2.9%.
Exhibit 1: Comparable Supply Set, Montana PMA
[Table or chart rendered in delivered report.]
Exhibit 2: Demand Projection Summary, 10 years Horizon
[Table or chart rendered in delivered report.]
Exhibit 3: Subject Capture Rate vs. PMA Absorption Capacity
[Table or chart rendered in delivered report.]
Analytical Conclusions
- Destination-wedding demand into the Bozeman corridor grew 22% over the trailing 24 months.
- Comparable cabin-lodging properties cleared $340 to $480 ADR at 58% to 66% peak-season occupancy.
- Subject reached 34 booked event dates and 62% cabin occupancy by month 24.
- Stabilized B&I DSCR of 1.42x cleared the guarantee program review threshold.
Deliverable
The delivered report ran 140 pages with 32 exhibits distributed across nine analytical sections, plus appendices documenting comparable supply data, demographic inputs, and financial projection assumptions. The document was prepared to the documentation standards of the rural community bank with USDA B&I guarantee. The corresponding USDA B&I review framework guided exhibit selection and supporting documentation.