30 Oct Buying or Selling Hotels in Ukraine. Hospitality Real Estate for Sale
Hotel real estate in Ukraine is actively gaining popularity among many investors. In addition to investing in apartments for further transfer to the management of the hotel operator, investors are considering the investment opportunities of buying a hotel. And here many questions arise, how profitable will the purchase of an existing hotel or hospitality real estate be for the development of the hotel business. This article is devoted to the topic of buying and selling a hotel in Ukraine.
Hotel partner in Ukraine
Proriat Hospitality Partners – investment management company specialising in the hotel and restaurant sectors. We provide comprehensive services in hotel management, sale and purchase of a turnkey hotel. Also, our company is regularly looking for large commercial facilities with the possibility of implementing hotel projects. We invest in the development of hotels. Opening hotels and providing comprehensive management solutions to ensure all our hospitality projects are running at the best and maximum profit.
Our hotel opening and management services, learn more 👉starting a hotel business in Ukraine
Buying a hotel in Ukraine: a comprehensive audit and financial analysis
Where to start buying an established hotel in Ukraine? Of course, the main elements in the transaction will be: hotel property valuation, brand positioning, competition, management and financial analysis.
- Valuation and analysis of hotel real estate
Hotel real estate is a valuable and liquid investment tool that should be assessed before buying a hotel business in Ukraine. We must understand how much investment will be required to renovate the room and guest areas. Or how long the hotel can operate without any refinance or reinvestment. This is an important point, since we’re buying commercial real estate, and such properties have its own terms when it is necessary to carry out major repairs.
- Hotel brand
A brand in the hotel industry is a combination of many marketing elements that provide company recognition and value, creating a portrait of your targeted guest, and can define the pricing strategy for hotel services. If the value of the hotel brand is put into the sale of the hotel or offered as a tyrn-key hotel business in Ukraine. Then, it is worth paying attention to many marketing elements. The main ones are the number of regular and loyal guests, marketing and sales department, digital resources (website, phone application, integration with booking services, cooperation with tour operators, etc.)
- The study of hotel competition in Ukraine
Competition in the hotel industry in Ukraine is determined through the study of many information resources. In general, this is a quick and easy process that will help you understand which hotels will be the main struggle for a guest, and how many reservations you can count on.
- Hotel management in Ukraine
Management in the hotel industry is a complex and team work of all departments to achieve maximum results using a minimum amount of resources. Often, many problems lie precisely in the inefficient or incompetent management of the hotel. As a result, we have a low level of hotel occupancy, which means problems with its profitability. This should not particularly affect the decision to purchase a hotel, since for this it will be possible to involve a hotel operator or a hospitality management company. See our catalog 👉Hotel operators
- The financial analysis
How to make a financial analysis of a hotel? To do this, you need to study the following key indicators from the financial activities of the hotel. Namely, the number of rooms (number of kyes), the percentage of room occupancy (occupancy rate), the average daily room rate (ADR – average daily rate) Financial reports, this is one of the most important indicators that should not be ignored if you are going to buy a hotel in Ukraine.
An example of financial indicators to evaluate before buying a hotel or hospitality business
Rooms (Kyes): 150
Occupancy rate: 70%
Average room rate: $100
Next, we need to determine the number of available rooms in a calendar year.
150*365 = 54.740 numbers available for sale during the year.
Average annual revenue in hotels or Gross Income. Considering an average occupancy rate of 70% and 54,750 available rooms at a price of $100.
54.750/70%*$100 = $3.832.500 turnover per year.
Net Income (NOI) in a successful hotel business averages 25% – 30%
If we take a net profit of 27%, then we get $1.034.175 per year. This is the main financial indicator that helps us understand whether it is worth considering buying a hotel in Ukraine or not and what the average return on investment will be.
If you are looking to invest in hotel real estate or want to buy a hotel in Ukraine, then our experts will be happy to provide you with the right hospitality property or turnkey hotel business for you.
Current hotel and hospitality real estate as well as turnkey restaurant business in Ukraine you can find in our catalog 👉 Proriat Real Estate
Hotel for sale in Ukraine
Selling a hotel as an existing hospitality business in Ukraine can be a daunting task. As practice shows, assets worth more than $1,000,000 can be sold from six to twelve months. Here you must determine for yourself whether you will be selling the hotel yourself or it is better to involve a brokerage company that will search for a buyer for your hotel property or hospitality business.
Proriat Real Estate is a brokerage company in Ukraine that specialises in the sale and rental of hotel and restaurant real estate. Commercial real estate experts will help you create a selling commercial offer to quickly sell a hotel or hospitality, commercial property.
Independently sell a hotel, restaurant or turnkey business in Ukraine
- First, you will need to create a photo and video presentation of the hotel.
- Choose a strategy for selling the hotel and options for attracting potential buyers or investors.
- Determine your advertising budget
- Prepare a detailed description of a selling hotel: total area of the property and adjacent land, number of rooms, tangible and intangible assets, etc.
- Purchase board placement packages and upload your hotel offer. Do not forget to regularly update hotel sales ads so that it is always on the first pages.
- Contact an advertising agency to set up targeted advertising for you on Google, Facebook, Instagram.
- It will not be superfluous to purchase a separate phone number, on which it will be convenient to contact you for a hotel showing or provide additional information.
- You need to be prepared in the first few days for a lot of calls from real estate agencies.
- Determine the days and times for meetings and showing the hotel to buyers and investors.
Thanks to a modern information solution, a hotel owner can sell a hotel or hospitality property in Ukraine on their own without involving brokers. Although, many hoteliers and large businesses prefer to work with brokerage companies. Because they understand that selling a hotel business in Ukraine can take a long time. And for many of our clients, time is the most valuable resource.
If you are planning to buy or sell a hotel in Ukraine and considering investing in hotel real estate, then Proriat Real Estate and Proriat Hospitality Partners will be a valuable partner for you in purchasing a hotel business, providing an effective it management.
The next step
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