There are so many new operators in the STR field now, and the questions about certain things are mind-boggling.

LLC in the state of operating?

Gita,At least the way I prefer to do things is to only run accrual based accounting activity on my day to day operations.

Managing the property yourself can save money, teach you the ropes, and give you firsthand experience dealing with tenants and operations.

On a commercial asset the value is directly based on the NOI (net operating income).

Over time, rents may increase, improving your cash flow, and you’ll gain equity and valuable experience managing tenants and property operations.

More than likely the asset will in a location where cap ex & management/operational costs are disproportionately higher and therefore your expense ratio will also have to be adjusted to a higher number.  

If operating costs increase, then customers/tenants will eat the costs in tight markets.

Sounds he’s not interested in going through the rent up stage and being an operator.

You get an operation running well and then you can be benevolent.