All Forum Posts by: Chase Hoover

 We've scaled up to boutique motels and inns - we have around 50 units in the Shenandoah Valley.  Great market.

Awesome! We're pretty pumped about it and hope to replicate the concept across VA and the east coast. Hopefully our paths will cross soon, I'm up in nova often.

We're working through the site plan on something similar now in VA, breaking ground this fall. 2 buildings 5k sf each, split into 1250 sf units. Targeting e-comm businesses, small home-based businesses wanting more dedicated space, retail businesses looking to downsize and focus on more online sales, etc. Sort of a mix of warehouse/retail/office, we're simply calling them "flex business suites".

Is it 6 dedicated units? If they weren't STR, could each of the 6 units be rented LTR? If so, this would be considered a commercial property and a commercial appraisal would be ordered by your lender (confirm this with your lender to be sure). The appraisal will take into consideration the financials of the property, as well as the replacement cost and local sales data.

Start your analysis by getting as much finanical data from the sellers as possible - P&Ls, tax returns, booking reports - for at least 3 years.  Look at the expenses - are there management costs included?  Other discretionary spending?  

Try to boil everything down to get a true operating NOI for the past 3 years. 2020-21 numbers are going to be inflated, so take that into consideration. Once you have a solid base NOI, figure out a cap rate to put on it. Around here, a turn-key hospitality property (without third-party management in place) will trade around 10-11%.

Good luck

@John McKee let's connect - my partner and I are starting to develop light industrial properties and looking to scale the concept. We're based in VA.

I picked one up on FB marketplace a few years back for $7k.  Probably can't get that lucky these days with how popular they are, but it might be worth a browse.  Lots of people bought into the craze a few years back and a few might be looking to offload.

We've used BB a lot in STRs over the years and continue to do so.  They are cost effective and easy to install, and look great in photos.  Yes they can be more maintenance than stone products, however if you finish them with several coats of hardening sealer they hold up ok.  We've had to sand and refinish areas from knife cuts and stains, however overall the cost and look outweigh the extra maintenance for us.

Be sure to speak to a few insurance companies as part of your due diligence.  When we pulled out of Florida in 2021, insurance for properties on/near the coast was becoming extremely expensive and carriers were dropping properties. 

Dear Bot - #3 is evidence that you do not own, manage, or are associated with STRs in any capacity.  Thanks for dumbing down this forum.

Do you care which instrument they play?