Any pointers to invest in hotels or resorts?

Question

Hello,

I am interested to invest in hotels and resorts along with a bunch of investors (would like to be passive). Let me know if you have any pointers?

Jonathan Greene · Answer

Pointers are all in the due diligence on the operator. If you are looking to invest passively in hotel or resort syndications, read The Hands-Off Investor by @Brian Burke to understand how to vet the operator then the deal.

If you are interested in hotel conversion, look up Alexander Cartwright at HotelShift. Also, for resort, look up Stephen Petasky of Luxus VP.

Michael K Gallagher · Answer

@Pradeep R. piggy backing on what others have said here, if you are going the passive investment route, while the asset is important, the real due diligence you need to do is on the operator and manager of the fund. It becomes more of "personal due diligence" along with the numbers.

Evan Polaski · Answer

@Pradeep R., similar to Jonathan's comments: the due diligence for all passive real estate investments is pretty much the same, whether it is hotel, apartments, retail, office, etc.

Obviously, each will have its own nuances as to what success looks like and what risks are associated with each. And there is terminology that is likely to be used in each: i.e. RevPAR in hotels, WALT in retail, etc. But at the end of the day, the primary goals are the same.

Sponsors capabilities to succeed. Business plan for each deal. Structure of each deal. Market risks, management risks, supply demand drivers, etc.

Any pointers to invest in hotels or resorts?

Any pointers to invest in hotels or resorts?

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