Appraising hospitality facilities and restaurants is unique because of upside potential linked to management proficiency. We have seen seemingly marginal properties become very profitable with management changes.
In one instance, over a two-year period the average room rate doubled and the occupancy increased 20%, with no significant market changes. The question is to what extent business behavior affects real estate value because, in varying degrees, it always does.
Management proficiency is, therefore, a germane concern. Other considerations, in addition to “all the comforts of home,” include destination location proximity, guest profile, room lay-out, sizes, and mix; banquet and conference facilities; accessibility; visibility and exposure.
While we are competent to appraise most hotels and restaurants, for larger, five-star facilities or casinos we recommend contacting either John Gordon, MAI, GVA Kidder Mathews (425-283-5783); or Scott Biethan, MAI, CB Richard Ellis (206-292-6198); specialists in larger hospitality facilities appraisals.