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Expert and professional, we have carried out over 2000 hotel valuations worldwide.

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Hotel Valuation

Expert and professional reports

From single asset to portfolio’s spread across several countries, Horwath HTL’s Hotel Valuation experts will provide an independent, fair market valuation. We have experts with RICS and MAI accreditation who have been working in markets for many years and have a huge database of knowledge to draw on.

Hospitality assets, such as hotels and resorts, are complex real estate types, with significant land use value depending on their operational performance. Their performance is susceptible to greater market fluctuations, location issues, management sophistication and high capital investment than other real estate such as office or retail. Because of this, the valuation of hospitality assets requires a special market understanding and product expertise. Today, Horwath HTL is the leading industry expert retained by major hotel owners, lenders and operators to optimize their investment returns.

We employ a sophisticated Discounted Cash Flow (DCF) valuation approach recognized as the standard by investors in the hospitality industry. In our experience, sophisticated investors use replacement cost and sales comparisons only as secondary references. The DCF valuation process involves thorough review of the market, quantification of current and future market demand and most importantly, projection of a property’s potential future operating and financial performance based on assessment of its competitive attributes and characteristics. Discount rates based on prevailing investment trends and the weighted average costs of debt and equity are then applied to the projected net cash flows and aggregated to derive the property’s present value. Often, we also identify the potential upside opportunities associated with strategic repositioning through rebranding and/or capital improvements to derive a value reflecting an asset’s optimal performance.

Horwath HTL asset valuations are regarded as independent, expert opinions and a pre-requisite for:

Buyers, Investors and Fund Groups – for acquisition or disposal of single properties or portfolios

Owners and Developers – for arrangement of deal structuring, financing or disposal of assets

Banks and Financing Institutions – for pre-mortgage review or work-out and insolvency situations


SUITABLE PROJECT TYPES
:

  1. Land Acquisition (using residual land value analysis)
  2. Asset Transaction
  3. Equity / Debt Participation
  4. Pre-Lending or Refinancing Review
  5. Due diligence for acquisitions or disposals
  6. Stock exchange listing
  7. Basis for joint venture or partnership structuring
  8. Asset revaluation for balance sheet purposes

Our valuation services include:

  • Brand and Franchise Management – Valuations of hotel management and franchise companies including selection of brand/franchise and review of affiliation performance
  • Real estate tax assessment appeals and expert court testimony
  • Expert valuation testimony for foreclosure and bankruptcy proceedings
  • Accounts purposes – short form annual valuations undertaken for a variety of investor’s operators and owners.
  • Feasibility – studies undertaken worldwide on hotel viability purposes on new developments conversions and existing operations
  • Expert Witness /Rent Reviews/Lease Renewals – acting on behalf of Landlords and Tenants as well as investors and insurers

Success Stories

  • Valuations SS
    Valuation

    Inland American, Hotel Portfolio Valuation

    Scope of Work: Inland American requested our services in evaluating several large portfolios of hotels for their REIT.
    Description of Project: We evaluated over 200 hotels in 5 portfolios over a period of two months, generating a high level analysis of the performance and prospects of each portfolio and recommending specific inclusions or exclusions of hotels. The total value of the portfolios was over US $2billion.
    Project Status: Completed in 2007

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    Valuations SS
    Valuation

    Horwath HTL Representative Appraisal Assignments

    Scope of work: Horwath HTL USA has worked on many valuation and appraisal assignments.

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