Hotel Valuation Essay

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Hotel Accommodation Valuations By Daniel Tan Curtin University is a trademark of Curtin University of Technology CRICOS Provider Code 00301J Outlines  Hotel Valuations: Concepts & Methods  Hotel Market Update & Sales Hotel Valuation Case Study Curtin University is a trademark of Curtin University of Technology CRICOS Provider Code 00301J Accommodation Property & Licensed Premises The Various Ownership Interests ▲ Business (Leasehold) ► ► ► ► Goodwill Furniture, Plant & Equipment Licences, inventories Working capital ▲ Land & Buildings (Freehold) ▲ Walk in Walk Out Curtin University is a trademark of Curtin University of Technology CRICOS Provider Code 00301J Hotel & Motel Valuation: These are the four components of value or attributes for a hotel/ motel valuation: 1. 2. 3. 4. Land Improvements Furniture, Fixtures, & Fittings (FF&E) Business Value - Includes licences, inventories, goodwill, working capital, and going concern. (Nelson, Messer and Allen, 2001) Curtin University is a trademark of Curtin University of Technology CRICOS Provider Code 00301J Business Value Includes the 6 of the following: 1. Organisational Value:  Staff: • Advertising • Employment Agency Costs • Hiring & Training  Managing FF&E • Operations & Maintenance • Energy Management • Upgrading & Replacement  Attracting Business: • Advertising Campaigns • Corporate Contracts • Marketing & Reservation Networks Curtin University is a trademark of Curtin University of Technology CRICOS Provider Code 00301J Business Value Continued… 2. Working Capital Value: Essential for the day to day running of the business Measured by the cost of acquiring working capital on reasonable credit terms 3. Inventories: Inventories are tangible personal property: linens, cleaning supplies, stationary, glassware, china, cutlery, food, liquor, etc...

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