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Tips in buying a Motel
The following tips are set out to make you aware of the main points to consider before commencing your search.
12 Basic Tips:
| Finance: | It assumed that you have consulted with your financier
to establish your purchasing power. If you have not done so
click on "Motel Finance" to the left of this page. |
| Residence: | Living standards and distance from relatives are
a major part in your ongoing lifestyle. You would be surprised
how many people sell their motels due to loneliness. |
| Location: | The location (City) of the motel sets the scene
on how the motel trades. The better the location the better
the motel trades. |
| Position: | If the position of the motel, say central CBD
is good you cannot do better. |
| External Appearance: | External appearance "pull up appeal"
is very important. |
| Condition: | If the motel is maintained correctly the condition
will always be above average. |
| Annual Revenue: | Tells the real story - turnover to number of rooms
is an average to assess at all times. |
| Size of Rooms: | Older motel small rooms. To command acceptable
tariffs you must offer spacious rooms & bathrooms. |
| AAA Rating Report: | A detailed report carried out by a competent assessor
is a must to carefully study. |
| Continued Patronage: | This where your good will is calculated. It is
defined as "Evidence of a relationship that retains &
promotes repeat business. |
| Reason for Selling: | If you cannot get a plausible reason be very wary. |
| Minimum tariff growth of 2% if Leasehold: | It is all very well to view the current position
but you must evaluate the district & motel to assess if
there is a growth potential. Prepare a 3yr business plan which
accompanies you financial due diligence for finance. |
For you to be able to inspect and assess the motels offered in the market place you will need the assistance of a Motel Broker.
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The list of Motel Brokers displayed in Motelinfo are actively operating in NSW. We trust this service simplifies your search for a Motel Broker who can assist you in your search for a motel |
Final Tip: The viability of the City and surrounding area together with the location of the motel dictates the value of the business. Imagine a motel in the middle of a growing thriving town or city. Even if it is run down you are assured of strong growth of the town and its excellent position being near restaurants clubs etc. Also your expertise is magnified when you upgrade the premises and offer superior service. Growth is assured with minimal advertising.
A motel like this is a dream and you will be frustrated looking to find a motel of this calibre. I have used this example so you will respect location location location being the major rule to consider when purchasing real estate.
Always keep location of the motel in mind when assessing the future growth potential of the business.
Good Luck.
Russ Dodson
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