Timeframe to Sell a Hotel
How Long Will It Take to Sell a Hotel?
The timelines of hotel sales have many variables and there’s no formula to calculate the time from the moment the hotel listing goes up to the time the sale closes. There are, however, several factors that make a big difference in the amount of time it takes to sell a hotel.
Timeline Factors When Selling a Hotel
Price
An obvious factor in the sales timeline is the price. Buyers are looking for a hotel that’s in their budget, and a hotel property for sale at a price that doesn’t seem appropriate will turn off potential buyers. If a hotel is priced higher than it is worth, potential buyers will scroll right past it. If it’s priced too low, many will assume there’s something wrong with it. This is an area in which hotel brokers are extremely useful. Southeast International has a team of experienced hotel brokers that will help you choose a price that will get the most out of the sale without pricing too high and losing potential buyers.
Age
Age is another determining factor for how long it will take to sell a hotel. An older hotel may be well known but will likely require more renovations and updates initially, as well as maintenance on a regular basis. A newer hotel will most likely require a lot less work. These are all things that potential buyers will consider.
Property Condition and Features
The condition of the hotel property for sale will make a difference in the amount of time it will take to sell. If you have stayed on top of maintenance and made updates, there will be less hesitation and you won’t have to wait for someone looking to buy a fixer-upper. If you’re able to, it is worth considering making the updates and fixes that will increase the property value. The amenities that the property has to offer will also affect the amount of time it takes to sell a hotel.
Franchise Term Remaining
If you’re trying to sell a hotel that is part of a franchise, the amount of time left in the contract will also be a factor in how long it will take to sell. If your franchise agreement is nearing the end of its term, a new buyer will likely have to commit to an extensive PIP in order to secure the same brand.
If the franchisor has determined it will not allow your property to remain in the system upon sale of the property, it greatly increases the amount of time required to find a buyer willing to re-brand or go independent – much of the problem being obtaining financing since there is no financial history to predict future performance under a different brand.
Brand availability may also be scarce in your market. All of these factors impact the appeal of a property to buyers and, therefore, the period of time it will take to find a buyer.
One last factor that may affect the timeline is price per unit compared to other brands and new construction, which ties into factors previously mentioned.
All of these variables make it hard to give a prediction on how long it will take to sell a hotel. The good news is, if you hire an established hotel brokerage like Southeast International Hotel Brokers, your hotel sale will be in the hands of seasoned industry experts who have the resources to connect you with the right buyer in a timely manner.