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Updated over 4 years ago on . Most recent reply

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Craig Kamman
  • Rental Property Investor
  • Plymouth, MN
4
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11
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Novice to hotel investing, looking for information

Craig Kamman
  • Rental Property Investor
  • Plymouth, MN
Posted

Given the market condition for the hospitality industry, it seems likely there might be opportunities to purchase hotels at a reduced price.

What vacancy rate does one use for analyzing the hotel?

Are there management companies available to manage the property?  Is so, what are their fees or rates?

What type of financing is available for hotels?

Does anyone have any experience or insight to point me in the right direction?

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Greg Dickerson#2 Land & New Construction Contributor
  • Developer
  • Charlottesville, VA
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Greg Dickerson#2 Land & New Construction Contributor
  • Developer
  • Charlottesville, VA
Replied
Originally posted by @Craig Kamman:

Given the market condition for the hospitality industry, it seems likely there might be opportunities to purchase hotels at a reduced price.

What vacancy rate does one use for analyzing the hotel?

Are there management companies available to manage the property?  Is so, what are their fees or rates?

What type of financing is available for hotels?

Does anyone have any experience or insight to point me in the right direction?

Hotels are a retail business. They can be very profitable but are also very fragile and sensitive to economic downturns like 2009 and right now. This is not the best time to enter the business as a novice at least not without a mentor or partner who knows the business inside and out and significant financial liquidity. It's going to take some deep pockets to ride out the current environment and get hotels back to break even and ultimately profitability.  

There are third party management companies you can hire that will run operations for you. There are a lot of industry associations out there with lot's of great info on the business. You can do a quick google search and find lots of resources..

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