Anyone investing in boutique hotels?

Question

My partner and I are actively looking to acquire a ~12 room hotel and utilizing a lot of the STR systems we use in our single family homes. Curious if anyone else has implemented this strategy and is willing to share their experience?

Michael Baum · Answer

Hey @Cliff Benner, there are a few options and I am no expert on the subject.

You should contact an SBA lender an see what is available.

I will say that if you are doing something like a duplex or triplex then SBA will not be for you. Even a 50 unit apartment building would be tougher.

You would need some kind of commercial hospitality business like what I posted about.

For example we thought about doing a nice B&B in New Hampshire years ago. Buying an existing B&B was the plan and the SBA lender we spoke to was OK with it. That was years ago.

Garrett Kroll · Answer

Under 2m is where we're focused - so just a hair under 50m :)  That limits inventory quite a bit so we may end up widening the 10 hour circle, we'll see.

Definitely not looking to relocate, but the SBA is great call I'll look more into that option. I've also noticed a few listings with retiring owners so I'll be polishing up my seller financing talk track.

Chase Hoover · Answer

We partner with a third-party management company who handles all cleaning, maintenance, etc.  Others choose to self-manage and source/manage these vendors themselves, however we've found it beneficial to pay a bit more for outsourcing this which has allowed us to scale quicker and enjoy our weekends!  The biggest we have without OSM is 22 units - not sure I'd go much bigger than that.  The security from STR regulation (commercial zoning) is one of the biggest reasons we scaled up to this model as well.

Chase Hoover · Answer

Yessir - 4 boutique lodging properties, about 50 keys.  It's a different beast - make sure you have the right team in place!

Cliff Benner · Answer

@Michael Baum I appreciate it.

Sounds like find what I am looking for then call lenders until i figure out a loan.

Cliff Benner · Answer

What type of SBA loan should one be looking for if they want to do this and live on site?

Tyler Garcia · Answer

this is awesome, congrats! I've been watching a ton of Blake Dailey on Youtube around the entire Boutique Hotel Investing subject and it's been really helpful tbh. I'll put his channel below incase anyone's interested

https://youtube.com/@BlakeDailey

Michael Baum · Answer

Sounds good @Garrett Kroll. I am looking forward to seeing how it shakes out. Good luck and keep us posted!

Michael Baum · Answer

What is your pricepoint? The Alpenhof is for sale. Teton Village area.

https://www.alpenhoflodge.com/

Seriously though, a quick search through Loopnet showed a few places for sale, but most are well over 1m and most are over 3m. Those are currently operating lodges/resorts/hotels.

Some are really cool like the Alpenhof, but crazy money at 50m.

Are you willing to relocated to run a bigger place? The SBA could be a plan for a loan if you want the whole thing up and running.

Anyone investing in boutique hotels?

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