Hotel Evaluation
and what hotels deliver
The report goes beyond fundamental ratios to reveal areas for improvement and highlight your hotel's strengths.
It provides a snapshot of your current financial health, considering assets and liabilities.
General truth!
Hotels can be pricey, but have you ever considered the value of a single room? It might surprise you!
According to experts, a hotel room can be worth around 100,000 times the price of a single mini-bar Coke! That means if that tiny can costs $3, the room itself could be valued at $300,000!
Here’s the breakdown:
- Hotels are often valued based on their ADR (Average Daily Rate).
- A common estimate is that a room's value is 1,000 times its ADR.
- So, a 100-room hotel with a $120 ADR could be worth a cool $12,000,000!
But hold on! There’s a catch. This method applies to hotels with:
- High occupancy: At least 70% of rooms filled most nights.
- Strong income: Income before fixed costs needs to be over 55% of room sales.
This is a simplified look! Hotel valuation is complex, but it’s fun to think about, right?
Why Hotel Valuation is Essential?
Are you thinking about buying or selling a hotel? A valuation is a must! It's like getting a professional appraisal to understand exactly what your property is worth.
Here’s why valuations matter for both buyers and sellers:
Informed decisions
Smart resource allocation
Hotels are unique:
Daily hustle
People power
Brand power
Cash is king
Worth More Than That Mini-Bar Coke?
The hotel world is seeing a big shift! Hotel companies are merging more and more, making familiar brands even more widespread. This means travelers have a better idea of what to expect wherever they go.
But this trend also creates some challenges:
- More money is flowing around as hotels buy and sell. This means reliable valuations are crucial to ensure fair deals.
- With so many deals happening internationally, figuring out a hotel's true value requires a more sophisticated approach.
Here’s why valuations matter:
- Empty rooms, empty wallets: If a hotel doesn't meet guest expectations, they'll go elsewhere. That means fewer rooms booked and less money coming in. It's important to understand what's keeping your rooms empty so you can fix it!
- Knowing your worth: Without a recent valuation, hotel owners are flying blind. They don't know how much their property is worth, making it tough to decide on renovations, expansions, or even selling.
The takeaway? The hotel industry is changing, and valuations are more important than ever.
Valuate you business
Estimate the worth of your business
Sucess Stories
Choose us.
Monitoring and interpreting the complex business environment is a challenge for your business. Our valuation program allows you to collect and use the information of the report in support of your business strategies.
Our Valuation method:
In-depth financial analysis
Proven Valuation Methodologies
Industry benchmarking
Customised approach
Our flexible pricing plans
Basic Valuation
(Less than $200k in sales)
- Certified
- Accredited Appraiser
- Fair Market Value Calculation
- Explanation of Valuation Conclusion
- Earning Capacity Analysis
- 10-12 Page Report
- Financial, Market and Economic Analysis
- One Valuation Method
Full Valuation
- Certified
- Accredited Appraiser
- Fair Market Value Calculation
- Explanation of Valuation Conclusion
- Earning Capacity Analysis
- 10-12 Page Report
- Financial, Market and Economic Analysis
- One Valuation Method
- 15-20 Page Report
- Up to 2 Valuation Methods