Do you want to know the weaknesses and strengths of building a hotel property investment? For those of you who are entrepreneurs or who want to be involved in an lodging business such as a hotel or, on the hotel page, on my site this time I will tell you the advantages and disadvantages of building a business / hotel accommodation property.  You just take a look at the article below.

In my opinion, if you are a long-term type of investor, not a speculator. If you focus on assets, hotels are still attractive because the hotel business is basically a property business. Where the property value is good and well maintained will always increase from time to time.

Because investing in the hotel business is indeed a long-term type of investment. It is always in the range of 5-10 years or more. As an illustration, if you invest around 100 M, usually, on average, the hotel is only able to generate revenue to the company of around 10 M / year depending on the type of hotel and the hotel classification after deducting hotel operating costs.

Although hotel revenue is also important, especially if the hotel is built because the funds are obtained from loans. But banks will be very flexible with hotel property investment considering the collateral is there, will not go anywhere, and is better than other types of property.

In the world of hospitality, remembering that competition because it will affect hotel revenue and profit received by the owner. You can choose the branded self-management method. Then which one is better, create and build your own. Some of these points might help you.

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Self-management Property Hotel Investment

The Advantages Hotel Property Investment:

  • The total profit will be entered as company income because it does not have to pay. To be the main determinant in terms of spending on hotels, especially those included in the asset group
  • More freedom to determine the theme of the hotel in terms of interior decoration, exterior, and outlets that will be owned

The Weaknesses Hotel Property Investment:

  • People development is usually weak
  • Unprofessional family management
  • This will not get maximum hotel revenue due to low occupancy rates (due to poor recognition)
  • Incorrect tax calculation due to a lack of experts who could potentially cause problems with the regional revenue office and the tax director general especially if the audit system is not in accordance with hotel transactions.

Branded Property Hotel Investment

The Advantages Hotel Property Investment:

  • More professional management
  • The operational system is ready
  • It is well known to people so that the potential for income can be maximized
  • Have a personal and career development program for employees and management
  • A more precise tax calculation
  • Quality standards are maintained
  • The vision and mission of the hotel is clearer and more scalable

The Weaknesses Hotel Property Investment:

  • The type of goods purchased must be according to the standard which sometimes the price is very high
  • Design standardization that cannot be changed just like that

Hopefully this information can help those of you who want to build a hotel business. What is mentioned above is only part of the various factors that exist, but hopefully it can provide a sufficient picture of the hotel business.

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