Feasibility Study

MARKET FEASIBILITY STUDY

PROPOSED

HOTEL/CONVENTION CENTER FACILITY

LANCASTER, PA

PREPARED FOR:

MR. DICK SHELLENBERGER, CHAIRMAN

BOARD OF COMMISSIONERS

LANCASTER COUNTY

PREPARED BY:

PKF CONSULTING

MAY 2006

May 12, 2006

8 Penn Center Plaza

th

19 Floor

Philadelphia, PA 19103

Phone: 215-563-5300

Fax: 215-563-1977

Mr. Dick Shellenberger, Chairman

Board of Commissioners

Lancaster County

50 North Duke Street

Lancaster, Pennsylvania 17608-3480

Dear Mr. Shellenberger:

In accordance with your request we have completed our market feasibility study

associated with the proposed development of a Hotel/Convention Center to be located

in Downtown Lancaster, Pennsylvania.

The entire study and conclusions reached are based upon our present knowledge and

information with respect to the status and demand characteristics of the subject

project’s competitive lodging and meetings markets.

As in all studies of this type, the estimated results are based upon competent and

efficient management and presume no significant change in the competitive position of

the lodging and meetings industries in the immediate area from that as set forth in this

report. They are also based on our evaluation of the present economy of the region and

do not take into account or make provision for the effect of any sharp rise or decline in

economic conditions not presently foreseeable. To the extent that wages and other

operating expenses may advance over the economic life of the subject project, we

expect that prices of rooms and other services will be adjusted, at least to offset such

advances. The terms of our engagement are such that we have no obligation to revise

this report or the estimated annual operating results to reflect events or conditions which

occur subsequent to the date of the completion of our fieldwork. However, we are

available to discuss the necessity for the revision in view of changes in the economic or

market factors affecting the proposed project.

Please do not hesitate to call...