Hotels

General Real Estate Investing
1

Javipa recently explained to me that hotels should be viewed as “running a business” rather than “real estate investing.” This makes sense.

However, is there any way that one can match the cap rates seen in 30 - 120 unit apartment complexes with hotel investing?

I would never be interested in a hotel that requires the owner (me) to be on site.

I think I would be looking for “flagged” hotels.

As long as you hire a manager, it’s still passive income and if the money is right, why not? (but same could be said of a McDonald’s franchise or a car wash obviously)

2

Hi,

Real estate investing is a business! Everything we do is a business! If you or I wanted to we could invest cash and have 100% of everything else managed and handled for us, but the reality is everything we do is business!

Make a list of any real estate, someone has to manage, care for and oversee the property! Everything requires someone to handle the business part!

Even if you buy a little 600 sq. ft. one bedroom house, unless you want to leave it empty your going to be in business! Paying the property taxes and insurance once a year is business even if you don’t want to be!

Redstar I am surprised as to how gullible you are at times? What do you think real estate investing is? Grocery Shopping? Automotive Service? An Airline?

Jay knows better than most exactly what real estate investing is! But I even enjoy it when he pulls your leg?

                  GR
3

In any event, I can see his point. He said he wasn’t interested in hotels because they were different from apartment complexes.

I don’t think he was being sarcastic when he said that he wasn’t interested in hotels as an investment.

You could also view hospitals, nursing homes, mini storage, drug rehab centers, and many others as real estate investing also.

4

Ha! Well, I was cutting too broadly with my definitions.

Of course, any type of real estate investing is a business. Or should be treated like it.

I was just attempting (poorly) to draw a contrast between operating a hotel and an apartment building.

Good post.

5

In any event, an apartment complex is a business just like a hotel or a barber shop.

And that hotel in my other post had a 8.6% cap rate, which is not too shabby.

I’m now wondering why he doesn’t like hotels, but I don’t care all that much.

Hiring a property manager to run an apartment complex or someone to run a hotel sounds like the same thing to me…

You know what would REALLY be nice? If I had some money to build a house in Naples.

I just started a pressure washing and painting company and I’m going to generate cash to start building homes (or to partner with other equity partners like my recently rich father who I’m trying to convince to join us on this forum)…

In 30 years, I will still be on this forum, at that point running a large home building company, which according to my numbers is a much better return on investment than real estate investing depending on how quickly you can build and sell the house.

And if none of this works, I’m going back to my original plan of manufacturing discount wool sweaters for puppy dogs.

6

If you think your calculations are correct, then this would be a good investment for you. Hope you make a good profit on this building.