Hotels are the category where the business and the building are one transaction. Value is expressed per key and underwritten on RevPAR and net operating income rather than an SDE multiple — which is why our calculator deliberately doesn't quote a hotel band, and why lodging deals bring a different diligence playbook than the rest of Main Street.
This category's bands vary too much by contract quality to quote a single honest range here — the drivers below matter more than any headline multiple. For a personalized starting range from your own numbers, use the free valuation calculator.
Occupancy, ADR, and RevPAR against your competitive set — buyers benchmark all three before they read your P&L. A property outperforming its comp set carries pricing power; one underperforming invites the renovation-and-reposition discount.
For flagged properties, the brand's property improvement plan lands on whoever owns the hotel at renewal — and buyers price the expected PIP into their offer. Getting a read on the likely PIP before going to market keeps that number a negotiation, not an ambush.
Franchise agreements carry transfer approval, fees, and termination windows; independent properties trade on their direct-booking engine instead. Whether the flag stays, changes, or comes off shapes the buyer pool as much as the price.
STR reports, monthly occupancy and ADR by segment, and the franchise/brand contribution reports — not a summary spreadsheet. Lodging revenue is seasonal and segment-driven; annual averages hide the story.
Brand-required renovations plus the roof/HVAC/FF&E reality are the true acquisition cost. An independent engineering review and a written PIP estimate belong ahead of the LOI, not after.
Brand approval of a new owner has its own application, fees, and timeline — and the brand can require the PIP as a transfer condition. Treat it like a lender: a party whose approval the closing actually depends on.
Primarily per key (price per room) benchmarked against comparable sales, and by capitalizing net operating income — with RevPAR (revenue per available room) as the core performance metric. Because the real estate and the operating business transfer together, hotel valuation is a different exercise than the SDE multiples used for most Main Street businesses; a broker review scopes the right approach for a specific property.
Usually, but not always — some transactions separate the property from operations through leases or management agreements. The structure changes financing, taxes, and the buyer pool, so it's one of the first strategic decisions in a lodging engagement, made with qualified counsel and tax advisors.
ALBEO FL LLC d/b/a Albeo Business Advisors · FL Lic. CQ1075604