hotel valuation
How to Add Value to Your Hotel Asset
Carrie Russell | May 16, 2019
By Carrie Russell At the most basic level, the value of a hotel is based on the property's net income divided by a capitalization rate. As such, one has two possible levers to adjust as a means of increasing a property's value: either increase the property's net income or decrease the capitalization rate. The capitalization rate, which is a factor that represents both the risk and the desired return associated with a given asset, is in actuality difficult to influence. Firstly, returns are market driven, which means that the capitalization rate is determined by market forces, not the will of owners. Secondly, it is the buyer's perceptio...
In Hotel Valuation, Being Different Helps …
December 28, 2017
'Cookie-cutter' hotels are easy to build and operate profitably, but properties with unusual features often attract a premium on resale. For example, the Chinese insurance firm Anbang set a record when it purchased New York's Waldorf-Astoria Hotel from Hilton in 2014. Most hotels cannot match the Waldorf in value, but a new study finds that having distinctive attributes helps with hotel values for upscale properties, like the Waldorf. On the other hand, cookie-cutter similarity may actually enhance the value of midscale and discount properties. The study, conducted by Ecole hôtelière de Lausanne professor Prashant Das and h...
Ranking Hotel REITS 2017: Dividends, EBITDA & Overhead
Hans Detlefsen | September 19, 2017
Which Hotel REITs Generate the Highest EBITDA Margins and Pass Along the Most Money to Investors? By Hans Detlefsen and Matthew Glodz Hotel Appraisers & Advisors (HA&A) is pleased to announce our second annual ranking of hotel real estate investment trusts (REITs). HA&A currently monitors 16 hotel REITs, discussed throughout this report. Some hotel REITs are more effective than others at generating earnings and passing profits on to investors. In this year's report, we rank each of these hotel REITs according to three metrics: (1) dividend yields; (2) EBITDA margins; and (3) overhead expenses. Our 2017 rankings are based on...
Cornell CHR Report Asks: “Do Property Characteristics or Cash Flow Drive Hotel Real Estate Value? The Answer Is Yes”
the Center for Hospitality Research | March 21, 2017
Ithaca, NY, March 21, 2017 - In determining accurate values for hotel properties, analysts typically use either of two methods, one based on comparable sales that includes hotel characteristics and another that relies on projected income estimates using capital market variables. A new study from the Cornell Center for Hospitality Research (CHR) concludes that neither model is superior to the other, and further that combining the two models does not result in more precise hotel valuations. The CHR report, titled "Do Property Characteristics or Cash Flow Drive Hotel Real Estate Value? The Answer Is Yes," was written by Crocker H. Liu, the...
Hotel Values Rise in Eastern Europe While Those in the West Face Tougher Times, Says Hotel Valuation Index
HVS | March 6, 2017
6 March 2017, London: Hotels in Eastern Europe are benefitting from tough times in Western Europe with room values in the region seeing an impressive 11% average growth, according to the 2017 European Hotel Valuation Index (HVI) published this week by global hotel consultancy HVS. In a year that saw little change in values across the rest of Europe hotels in Bratislava topped the list of value rises, up 18.9% year-on-year, while hotel room values in Sofia rose 16%. Bucharest saw hotel room values up 14.6%, while those in both Budapest and Prague were up 9.9%. While many Eastern European markets saw their hotel room values rise from a re...
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