For entrepreneurs in the accommodation industry, electing to sell one’s hotel, motel, or resort business may be motivated by a wide range of professional or personal factors. However, it is important to recognize that these types of businesses and properties belong to a unique, highly nuanced market within the larger landscape of commercial real estate.
With that in mind, selling a hotel, motel, or resort property will involve a number of special considerations that can shift based on all kinds of factors like location, time of year, and the specific property itself.
In this blog, we’ll go over a handful of those considerations to help you get a better understanding of what to expect when you list your property.
Selling Timelines
The first thing you should know about selling a hotel, motel, or resort is that it takes time – a lot of time. Compared to selling a piece of residential real estate (and even other types of commercial buildings), selling an accommodation business is often a months-long process. This includes everything before, during, and after the transaction is said and done. Therefore, as you approach the sale of your business, it’s important to expect and account for a longer sales process. If you have a specific time frame for when you’d like to have your business sold, it’s best to get the ball rolling as soon as possible.
Who’s Involved?
Another nuance related to selling your hotel or motel property is the buyers themselves. In Canada, accommodation real estate attracts a dynamic range of buyers from individual investors to corporate entities, private equity firms, existing hotel brands, and more. With that in mind, there are usually multiple stakeholders involved in any given transaction – especially with larger or more established businesses.
As you may expect, the more parties involved in a single sale, the more complicated things can be. This means that everything from negotiations to financing can take much longer to finalize, once again stretching out the timeline of your sale and adding on new, specialized processes.
Searching for more information about accommodation real estate in Canada? Check out these related blog posts for more advice.
- What Makes a Knowledgeable Hotel & Resort Real Estate Agent?
- Should You Refer Your Client to a Commercial Real Estate Specialist?
- What Entrepreneurs Should Know About Hotel & Resort Real Estate
Franchise Considerations
If you’re currently operating a hotel or motel as part of a franchise model there will likely be a number of intricacies involving your franchisor when the time comes to sell. While accommodation franchising is not without its advantages, there will likely be some extra fine print to navigate when the time comes to sell. These nuances will be unique to your franchise agreement, however, some of your special considerations may include transfer fees, non-compete clauses, right of first refusal, and other limitations that could influence parts of your sale.
Discretion & Confidentiality
Like other types of business sales, selling a hotel, motel, or resort requires a healthy degree of discretion and confidentiality – especially during the early stages. Prematurely sharing the news of your sale can create stress, confusion, and all kinds of misinformation among your customers, staff members, and the general public. In some cases, poor discretion can even jeopardize a pending sale or lead to setbacks in landing a favourable deal.
There will be a time when it’s finally appropriate to share the news, however, that’s usually much later on in the process.
Thinking about buying an existing hotel, motel, or resort? Explore these related blogs for helpful guidance.
- 5 Ontario Markets That Hotel & Resort Investors Should Set Their Sights On
- The 411 on Boutique Motels
Sell With Carve Real Estate
Hotel, motel, and resort real estate transactions require a specialized set of skills, knowledge, and market insights that stand alone from other types of commercial real estate. With that in mind, entrepreneurs looking to accomplish a smooth, high-profit sale should partner with a professional expert – like us, Carve Real Estate.
As dynamic leaders in Ontario’s fast-paced commercial real estate landscape, we’re professional dealmakers who take pride in accomplishing the best possible results for our clients. Vastly knowledgeable about the intricacies of accommodation real estate, we can guide you through a strategic business sale that puts your interests at the forefront.
Looking to sell your hotel, motel, or resort? As leading commercial real estate experts, we’ve got the tools and know-how to help you be successful. Reach us by email at Ryan@carverealestate.com or call 416-618-0054.
