Vacant Motel Property

[Jerry Stanford]

I've noted a vacant motel property that's been vacant for more than a year.  I'm wondering where to start as far as determining if it would even be worthwhile as a wholesale deal. I have a feeling it's going to be torn down soon and want to find out if it may be a worthwhile investment. Where do I begin??

[Dan Wallace]

Unless you have experience with hospitality properties I would steer clear of this project. I have financed and did workout work on a number of hotel properties and they are tricky. From my experience I would stay far away from if the property is an exterior corridor, not had a major hotel flag recently and if other hotels have entered the market within the last couple years.

If it was flagged prior to it being vacant see if you can find the rep for the latest flag and find out what was going on. Many older hotels run into problems once the amount of capital upgrades required to keep a flag get too expensive.

Best of luck.