Hotel Brokerage: Sell, Buy & Value Hotels and Motels

Most hotels are valued on net operating income and a market capitalization rate, cross-checked against comparable sales and per-key pricing. Occupancy, ADR, RevPAR, franchise terms, required PIP work, and deferred maintenance all adjust the final number. For smaller owner-operated motels, a multiple of seller’s discretionary earnings may also be relevant.

Most hotel sales take six to twelve months from valuation to closing. Brand approval of the new owner, PIP negotiations, and lender underwriting are the steps that most often set the timeline, so we start on them early.

Sell-side hotel engagements are typically compensated with a success-based commission paid at closing from the sale proceeds. We discuss fees transparently at the start of every engagement, with no hidden costs.

A Property Improvement Plan is the list of upgrades a brand requires when ownership changes. Buyers deduct the expected PIP cost from what they will pay, so we obtain or estimate the PIP early and use it to set realistic pricing and negotiate who bears the cost.

Yes. We market your hotel without public signage, release identifying details only to qualified buyers who have signed a non-disclosure agreement, and control site visits so staff, guests, and group accounts are not disrupted.

Hotel buyers commonly use SBA 7(a) and 504 loans, conventional bank financing, CMBS loans for larger assets, and seller financing. Understanding the financing a property will support helps us price it for the widest pool of qualified buyers.

Hotels are generally eligible real property for a 1031 like-kind exchange, which can allow a seller to defer capital gains taxes by reinvesting in another investment property. We coordinate timing with your qualified intermediary and tax advisor, who should confirm eligibility for your situation.

Plan to gather three years of profit and loss statements, a current year-to-date P&L, STR reports, the franchise agreement, any existing PIP, a capital expenditure history, and property tax and insurance records. Having these ready shortens the sale and supports a stronger price.