How Should A Hotel Be Value By A Property Valuer

property valuation company in BrisbaneValuing a hotel is not the same as valuing a home, apartment, office or a commercial building. When you buy a home, you could get some revenues by renting it out. In the same light when you buy a hotel your main aim should be to get revenues by offering the rooms on rent. Hence, continuity of revenues and the rate at which they will increase over a period of time are very important factors to be taken into account while valuing a hotel. So revenue generation method is the best way by which hotels can be valued.

Apart from revenues there are also other important factors that should also be taken into account while valuing a hotel. The increase or decrease in revenues is directly connected to the location of the hotel. Hence, it is very important to look for hotels that are not only reasonably sure of their revenues but are also situated in a good locality. The next important point that should be kept in mind is the kind of food and beverages that are served in such hotels. Being in the hospitality industry, hotels are supposed to serve different types of foods to cater to various requirements. Hence, this is a very important point that cannot be overlooked when buying a hotel.

There are also other points that should also be taken into account. For example, good hotels are made of quality rooms, quality amenities and facilities which also must be closely looked into by the professional property valuers in Brisbane when they are assessing the same for its value. The loans and advances which hotel entrepreneurs have taken for running the hotel must also be factoring in before arriving at the net valuation of a hotel. Hence, valuation of a hotel without any doubt is a completely different ball game. It calls for hiring property valuers who are also good at valuing hotels, restaurants and food joints. top 5 double stroller – http://thestrollerguide.com/

The Various Things To Look Into While Buying And Selling Hotels

article-2559532-1B7CB36F00000578-478_964x614First and foremost, when buying a hotel it is important to appoint a property valuer as the initial step. This is because it is he who will be playing a major role in deciding whether the property is worth buying or not. Buying a hotel is a totally different cup of tea when compared to other property purchases such as buying of residential properties, offices, factories or other commercial apartments or buildings.

When buying a hotel it is done not with the intention of keeping it under lock and key. The main purpose of buying a hotel is to generate revenue. Hence, when you handover the entire documents pertaining to a hotel which you plan to buy, to a real estate agent, he will certainly look into from various angles. He will not only consider the cost element as far as the hotel property is concerned. He will also have to carefully evaluate the possible revenues that will come from the property over a period of time. Only when he is certain that the revenues will commensurate with the expenses, will he give a favorable valuation report.

Not all hotel properties are bought by paying cash. It is usually funded by loans from banks who certainly would like to know how the loan is going to be repaid. Hence, the role of a property valuer Melbourne becomes very crucial both for the banks and also for the entities who are planning to buy a hotel. Apart from hiring the right property valuer it is also important to make sure that you locate the property that is in the heart of the city or town where you are planning to buy it.

Hence, buying a hotel is a very tough task and apart from hiring the services of a good real estate valuer there are a number of other factors that you should also keep in mind. It is something that has to be done slowly and steadily and should never be hurried through under any circumstances.

How To Choose The Right Hotel – Useful Pieces Of Information

valuers in perthWhen we decide to go to a different city or a different country amongst the various things that we do is to book the right hotel. This is very important to ensure that we have a comfortable stay during our trips to places outside our homes. However, choosing the right hotel may not be as easy as it seems unless we know what exactly we are looking for in these hotels. There are different parameters by which hotels could be chosen. It could be based on the tariffs, location, facilities and amenities available and the food that is served in them. Hence, as a customer you should be very clear as to what exactly you are looking for in the hotels where you could be spending a few days, weeks or even months.

Since almost all the hotels offer almost the same kind of facilities you should be able to differentiate and zero in one on particular hotel or groups of hotels. When choosing a hotel, there are a few important points that should be kept in mind and the same are being discussed in some bit of details below:

• You should always look for hotels that are strategically located. It should preferably be in the center of the city and should be not very far off from the airport, main railway station or bus terminuses.

• The hotel should have a nice and comfortable environment and ambience.It should be homely and the staff manning the hotels should be professional, courteous and totally customer oriented.

• The amenities and features that are offered in the hotels are also very important for you to take the right decision. For example, any good hotel is expected to provide rooms that are comfortable, airy, well-ventilated and it should also have common fixtures and apparatuses like refrigerators, TV, cable connection, hot and cold water, internet connection, just to name a few.

• Any good hotel should be able to provide you with kind of food which meets your specific tastes and requirements. Today’s customers are very health and calorie conscious and hotels should be able to satisfy this particular requirement professionally. Offering complimentary breakfast, air-port pickup and drop and very common add-ons which hotels must provide without asking for it.

• The hotels should also have good conference room facilities, restaurants, bars, entertainment facilities, swimming pool, round the clock concierge services and secretarial assistance and services should it be required.

• Many tourists often spend lot of time in hotels and professional hotels should be able to provide arranged tours to places of interest for its clients.

• While tariffs are very important for any hotel, they should be careful that in their pursuit of lower tariffs, basic amenities and facilities are not compromised. They should also be in a position to offer online booking facilities and should be able to accept all standard and internationally approved methods of payment.

• Special facilities for foreign tourists in terms of understanding of the language with the help of translators are also things that should be kept in mind while choosing a good hotel.

The above are just a few points and there are quite a few more factors such as laundry facility, lockers for safe-keeping of valuables, 24/7 doctor and medical facility and other things which should always be available with any professional and customer-focused hotels. Hence, a number of factors come into play when you are in the process of choosing a hotel. As a customer you should always check up with at least a few hotels and only then decide on one which perfectly suits your specific needs and requirements.

How Are Hotels Classified – Useful Information

hotel-monteleone-french-quarter-new-orleans-hotel-lobby-732x428The number of hotels even in the smallest of cities and towns could run into a few dozens. Hence, when it is about classifying the same and awarding star categories to it, there are a number of factors that should be borne in mind. It is not an easy job to classify a hotel and it takes a lot of time and effort. One may have to appoint the best property valuers in Sydney to get the right value before doing anything. However, it would certainly make interesting reading if we are able to narrow down the various considerations when it comes to classifying a hotel. The next few lines would certainly be helpful to those who are keen on finding out how hotels are graded and classified.

The primary criterion for grading a hotel is location. If a hotel is located in the heart of the city, it certainly stands a better chance of being graded high on the list. However, location alone will not be the only factor. It could be considered as a very important criteria but nothing beyond it. If a hotel situated in the heart of the city is running short on amenities, features and luxuries, then it hardly makes any sense for it to be given any grading at all.

The size of the hotel is also another important consideration that is taken into account while grading a hotel. The size should take into account the open space, the number of rooms that it has, and other such facilities. Next in the line is the type of rooms that is has. Hotel managements who are desirous of upgrading their classification should certainly pay a lot of attention to the quality of the rooms that they provide to their clients. It should be of the best standards without being very expensive and unaffordable. Drawing a line between affordability and quality of rooms is indeed a tight-rope walk which hotels must learn fast.

The food that is provided in the hotel also has a bearing on the way a hotel is graded. A good hotel should be able to serve a variety of foods and should be able to satisfy the needs of customers who could be from different parts of the world. The next important point that needs to be taken into account is the type of customers that the hotel is targeting. Any 7 star hotels will have the most affluent customers visiting them and this certainly is a big feather in the cap for such hotels.

It goes without saying that when such high-profile customers visit a hotel, the service standards and overall quality should be of the highest quality failing which they would start losing occupancy rates, at least from such high profile customers. Last but not the least, having a suitable theme on which the hotel is constructed is also of significance. All the star hotels in our country and across the world have been awarded the grades because they have a theme that is uniform across all the groups of hotels that they operate and run. In fine, choosing hotels one by one, looking at the various factors and then giving grades to them is certainly no mean task and it does take a lot of time and effort.

Are You Buying An Existing Hotel – Read On

cancun-mexico-beach-nkiRunning a hotel-cum-food business is a good idea. This is because apart from FMCG business food and hotel business is considered relatively safe and free from recession and other economic uncertainties. However given the highly competitive environment in the hotel and food industry it may not be possible for most hotel owners to expect organic growth for and indefinite period of time. There are could be situation where business might stagnate or even start falling down.

In such situations it might become extremely necessary for hotel entrepreneurs to look at inorganic growth options. What exactly is inorganic growth and why is it important? Let us find out over the next few lines. Inorganic growth is nothing but buying an existing hotel that is doing reasonably well. This can help arrest the declining business trend and can be helpful for both the businesses. However buying a new hotel or an existing one is quite difficult. One has to take into account many factors and considerations. The entire decision has to be analyzed thread-bare and only when the advantages outweigh the disadvantages should the decision be taken forward.

There is also the need to take the help of professionals at various stages. One such group of professionals whose contribution is very important is that of valuers and appraisers. They play a big role not only in helping come out with the fair market value of the property but also help in going in detail on the whole project. They look into the age of the hotel, its location size, amenities and facilities and other important factors. They also make an estimated occupancy projection both for the short term long term. Only when it is found viable do they recommend such purchases or takeovers.

Identifying the right property valuer is very important because ordinary real estate valuers may not be able to do full justice to such complicated valuations. It is also important that these valuers have a good knowledge and experience of finance and marketing. Considering the above facts there is hardly any doubt that buying an existing hotel is very complex and time consuming. It should be done very carefully and the process should not be hurried through under any situations are circumstances. The decision should be carried forward only when it is hundred percent doable.

Things To Keep In Mind When Buying A Hotel

hotels-wikiRunning a hotel successfully and ensuring revenue growth for continuously for years at length is certainly a challenging task. Though hotel business is relatively more stable when compared to other businesses, it has quite a lot of competition which one has to encounter. Further the changes in macro economic conditions could also impact the businesses of many hotels. Under such circumstances, hotel owners should find ways and means by which they can move their business from one level of success to another. While they should try and grow organically to the best extent possible, at times it might become necessary for the hotel owners to go in for inorganic growth. This is nothing but taking over of an existing hotel and merging the same with the up and running hotel.

Though there are a number of benefits associated with inorganic hotel growth, it has to be thought out very carefully. There have been many instances where unplanned and hurried takeovers and mergers have resulted in drastic drop in business coupled with abnormal growth in overheads. This could be very detrimental to the overall health and well being of the original hotel business. Therefore it is very important to take professional help before going in for such hotel takeovers. The role of qualified and certified lawyers, attorneys, chartered accountants and last but not the least property valuers are extremely important to say the least. We will try and find out how a property valuer could help in such takeovers.

Valuing a hotel that is being planned for takeover is extremely important. However, this has to be done only by valuers who have previous experience in valuing hotels and other establishment related to the food and hospitality industry. Valuing a hotel is totally different from valuing a real estate property. The parameters are totally different and the inputs that are required are also not the same to say the least. For example, when taking over a hotel, the valuer should ensure that such a buyout is beneficial in the medium and long term perspective.

There is a need to use the right method of valuation where future revenues have an important role to play. The revenue should justify the capital cost that is required for such buyouts and the revenues must also be able to at least fund the cost of loans that might be required for such buyouts.

Buying A Hotel – Keep The Following In Mind

Hyatt_Place_Hotel_Features_Guestrooms_Background_ENWhen we plan to buy a hotel the first decision is to find out whether as a hotel owner, we have exhausted all the organic modes of growth. If there are still some avenues left they should be explored before going into the inorganic mode of buying out hotels. Once a decision has been reached in principle to buy another hotel, it is only then should one start looking out for a suitable hotel. It may not be possible to buy out a new hotel and it also does no make much economic sense. It is always better to look out for existing hotels that are doing reasonably well.

There are several advantages buying an existing hotel. They will have built a reasonably good reputation and goodwill over the past many years. Further they will also have a loyal group of customers. Hence, once the hotel is bought over the buyer may not have to struggle for initial cash flows that are so vital for the business.

Amongst the various professionals who have a big role to play one should always keep in mind the important the significant role of real estate valuers. They play a role in helping the buyers to have a reasonably good idea about the fair market value of the property. Additionally, they also help the buyer to have an understanding of the future cash flows and how important it is to ensure that the cost of buying hotels is met. Unless the future cash flows at least for the short and medium term are not good, many professional valuers would certainly ask the buyers to exercise caution. Further, the valuers also help in finding out more information about the quality of the hotel, its location, occupancy rate and other such vital information.

How To Buy A Hotel The Right Way

terraza-restaurant-abac-hotel-barcelonaThere are quite a few important things that must be kept in mind while buying a new hotel. First and foremost, it has to be understood buying a new hotel, however small it might be costs a lot of money. Though it would be advisable to buy it out of ones own internal resources, this may not be possible in most of the circumstances. Hence, one might need to go in for borrowings which could have an interest cost element built into it. Therefore before buying a hotel one should keep in mind whether they would be in a position to not only service the interest cost but also repay the loan in question.

Therefore the first step forward would be to take the help and assistance of professionals. When we talk about professionals in any real estate buying and selling the role of valuers should always be kept in mind. As a first step it would be prudent to take the services of good valuers and find out what is the fair market value of the property that is being bought. Further valuers will also use various methods (including the revenue generation method) to find out whether such a buyout could be profitable or sustainable in the long run.

Further the real estate valuers also play a big role in also giving useful information that talk about the location of the hotel, the size of the hotel, the overall condition of the hotel and the expected revenues that could be forthcoming from the same. All these are very critical and vital information which could help the buyers to make up their minds whether such a buyout is sustainable or not. Hence, any hotel buyout has to be carefully thought out consideration where the inputs of experienced valuers are very important to say the least. Only those valuers who have experience in commercial real estate buyouts would be useful.

Buying A Hotel – Points To Be Kept In Mind

hotel-interior-2When buying a hotel, the first thing you must do is to take the services and help of professionals. Without them it would be difficult to move to the next level. Amongst the various professionals who can help one should not ignore the importance of professional appraisers and valuers. They certainly have a major role to play as far as helping your in your hotel buyout plans are concerned.

When buying a hotel, one has to look at it from various angles. The location, the age of the hotel, the overall structure, the occupancy facilities and the various other amenities and facilities are important considerations that must be taken into account. Each of these points have to be looked at from close angles. Further ordinary real estate appraisers and values will not be in a position to value hotels and it has to be done only by those who have special expertise and experience in this field.

The next important thing to be borne in mind while buying out a hotel is to ensure that enough revenues are generated out of it. This is important because in 8 out of 10 cases, such hotel purchases would have been funded with the help of loans from banks and financial institutions. Hence, the role of the good and professional valuer is to find out that there is enough revenue and cash flow to at least take care of the various expenses including paying off the installments for loans taken for buying the properties in the first place. Unless revenues justify it would not be advisable for anyone to go in for such a high voltage purchase which could run into quite a few thousand or even millions of dollars.

How To Buy A Hotel – Useful Tips

25_533Buying a hotel is not child’s play even it is in a small town. It could call for investment of thousands or even millions of dollars. Therefore the decision to buy hotels in a bid to grow inorganically has to be done after a lot of consideration and thought. The entrepreneurs might have money to buy the hotel but that is not the end of it. The hotel has to be run successfully so that it generates revenue over a period of time. Failure to raise revenues would mean an investment that is dead which could create more problems than solutions.

To begin with before buying out a hotel it is important to identify some vital professionals to help you out in this job. When we talk about such professionals, the roles of property valuers and property lawyers and advocates are considered to be very important. While lawyers look into the legal aspects of the property, the role of property valuers is equally important if not more. They play a big role in finding out the fair value of the property after taking into account many facts.

The role of a good valuer is very significant when one is planning to buy a hotel. For example, the net worth of the hotel has to be calculated. This can be done only when the valuers are able to arrive at reasonably accurate market value of the property. Though there could some indicative pricing from the market, it may not be the one that could be completely trusted. Therefore it is quite common for many entrepreneurs to take the services and help of valuers to depict the true picture.

Apart from the role of these two professionals, as an entrepreneur you should do your homework thoroughly. You should be reasonably confident that you will be able to raise enough revenues that will not only take care of the investments that you have ploughed in, but also will help you to make decent return on your investment.

What To Look For When Buying Out A Hotel

Manhattan-at-Times-Square-Hotel-LobbyWhile there are many hotel industries which have grown quite big because of inorganic growth avenues that they have opted for, buying out a hotel is a very challenging and difficult task. There are a number of important factors that must be taken into account while going in for such acquisitions, takeovers or mergers. It is something that cannot be done by the hotel owners or boards themselves. It calls for the concerted and joint efforts are many professionals including advocates, lawyers, consultants and last but not the least property and real estate valuers.

The role of these professionals, with particular reference to property valuers is very important. This is because at the end of the day, it is all about the value of the property that is being bought. It is quite likely that such hotel buyouts could run into millions of dollars. Hence, the buyers are quite likely to keep quite a few things in mind and exercise all the necessary care and caution.

When valuing a hotel for buyout or other purposes, it may not be enough to follow the conventional route as far as other real estate valuations are concerned. There are quite a few other important factors that must be taken into account. Hotel buyouts can be only beneficial and viable if they are able to generate revenue over a period of time. Hence,  following the revenue method of valuation is the most important point that must be kept in mind while valuing a hotel, particularly when it is being bought for the purpose of expansion and business consolidation.

The revenue that is likely to be generated, the expected occupancy levels, the locality of the hotel are a few important points that needs to be thoroughly examined under the microscope. Of course last but not the least, the actual fair market value of the property that is being bought is also important to say the least.

Things To Be Keep In Mind While Buying A Hotel

HOTEL-VITALE_1650369iBefore beginning to even contemplate buying out a hotel, it is important to do your homework properly. Only when the normal organic growth options have been exhausted should one try  to go in for acquiring a hotel. This is because by acting in haste you may be jeopardizing the  normal growth prospects. You could be damaging the relationships with existing customers that you may have assiduously built over the past many years. Only when the growth avenue in the normal ways has been exhausted should one look for buying out of hotels.

It has also to be borne in mind that buying a hotel involves thousands and millions of dollars.  Hence, a due diligence process that is extremely well thought out is very critical to find out the  viability of buying a hotel out. As a starting step, the need to identify a reputed and experienced property valuer is the first step in this exercise. The entire due diligence process should be done by a team of which the real estate appraiser should be an important entity. When choosing this  service provider, it may not be advisable to go in for the conventional real estate appraiser. This  is because valuing a hotel might require adopting different methods. Hence, a good valuer is one who is able to value the hotel using the revenue model along with the conventional cost and sales models.

Further, when looking for a hotel for purchase, location is very important. Even if it is small hotel with lesser occupancy facilities, it is still having a look at it. Location plays a very  important role as far as occupancy levels are concerned. There should also be the need to look  into the revenue projections both from a short term and long term basis. This is important because it is quite natural that funds for buying the hotel will have to be sourced from banks. Therefore the promoters should be able to service the loans and interests comfortably. For this to happen, it is necessary that the hotel should have a decent occupancy rate at all points in time. The process is very lengthy and amongst the various professionals, the role of property value appraisers is perhaps the most important and significant.

Valuing A Hotel Property – Useful Tips

hotel_img34p227While there could be a few things that are similar as far as valuing a property is concerned, it is not the same as valuing a building, apartment or even a commercial property. When valuing a hotel property different methods and yardsticks are used and we will have a look at them over the next few lines.

Cost approach is the most common method that is used for calculating the value of a hotel. This is nothing but considering the cost of entering into a hotel business by buying out a hotel property. Thought this is a widely used method of valuing a hotel there are some issues according to experts as far as this method of valuation is concerned.

Sales comparison method is another widely used method of valuing a hotel. It works on the premise that a buyer will be ready to pay only that sum of money that which similar hotels of the same size, location and utilities are available. This is quite a tough job and would require the valuer to have a look at the various properties of similar size, location and other amenities. The value of all these hotel properties needs to be plotted and then a mean average should be arrived at. This is a reasonably accurate method but does take time and it quite complex to calculate.

The income capitalization method is another way of calculating the value of a property. It is nothing but trying to have a fix on the income and revenues that a hotel will generate over a period of time. When such incomes are adjusted from the cost of acquiring the property the difference is often referred to as the value of the property. This again is a highly complicated method but something that finds favor with many valuers and also customers.