1. Nightly Leases
Hotels sell their rooms by the night. Each night represents another opportunity to increase revenue. The challenge comes in optimizing the net income from each additional room night sold.
Sales and marketing make a hotel successful from a technical perspective. It’s straight forward to sell to the right audience or place advertisements in all the right places. However, the intangibles, like loyalty and property culture, are most important when building up a reliable revenue stream.
The spirit of the property spreads by word-of-mouth, and that is where you can extract the greatest value from a nightly lease.
This asset class recovers quickly from a downturn, but it is the first to suffer when the economy moves in the opposite direction. A deal based on sound economic fundamentals ensures that the hotel can weather a decline in business and come out swinging.