Tag Archives: Management Rights

Hospitality Business on the Gold Coast: Should You Buy a Motel or Just the Management Rights?

property management rights in Gold CoastThe economy is picking up, so more people are travelling once again. A motel, hotel, resort or caravan park, under the right circumstances, can provide owners reasonable returns on their investment.

For accommodation like hotels and motels, the market is not limited to tourists. As a matter of fact, an establishment that caters to business travellers is more likely to be stable all year long, as, unlike a tourist-dependent place, its operation has no off-peak seasons. People in town for business are more likely to check in during weekdays, as well, keeping the business busy 24/7.

A business that offers accommodation, however, is always dependent on its location. Since guests actually have to be in the hotel or motel to enjoy what they paid for, so do the owners or their managers. The latter has to be hands-on – and possibly, onsite – when managing, maintaining, or even promoting the accommodation, which is different from running an online business selling items.

Motel Purchase

If you are interested in putting up a motel or hotel business, industry experts recommend buying an existing motel, as opposed to building one from the ground up. The logic behind this is that buying instead of building can save you more money, thereby giving you higher ROI.

Once you decide to buy a motel, watch where you choose to get one. Location, as mentioned, is a powerful factor. Apart from the location, you have to decide whether to keep the current staff or not, assuming you’re buying a motel still in operation. The situation differs per type of accommodation. A small hotel, for instance, is likely to have more staff members than a motel of roughly the same size.

Of course, you have to make some improvements. But that doesn’t mean throwing away money; it only means making sure the establishment offers better service and facilities, and a new branding, unless you want to keep the old one.

Management Rights Acquisition

Not everyone has the money to buy an entire motel.  But you still have an option if that’s the business you want. Resort Brokers Australia suggests that you look for management rights for sale on the Gold Coast. If you own these rights, you don’t own the establishment, but you get to operate it. You’ll only receive a salary for managing it. Nonetheless, it’s a well-paying and relatively relaxing job. You live on site, so that translates to savings, too.

Joining the hospitality business today is timely, as the travel and tourism industry is picking up in many areas of the world, including Australia. Take part in it now and it will have more significant benefits for you in the future.

The Simple Hacks to Get Financing for Your Management Rights Business

Right Business in AustraliaIt does not matter whether you are a newbie or an investment expert, it is important to get a suitable finance solution when purchasing a Management Rights business. Many banks can help you, given the competition being so stiff in the field.

The ideal finance deal for you, when you are looking for a lucrative management rights for sale, is from the lender who is willing to offer your business great discounts and other benefits, such as Resort Brokers Australia.

Get the Right Finance Broker

More than often, clients use their current broker when they want to source management rights finance, but discover it is a wrong choice due to their lack of knowledge when it comes to this type of investment. It is important that you deal with a finance broker who is an expert when dealing with Management Rights. Be sure to consult about the number of Management Rights transactions that the broker has completed successfully and you will get an idea of their expertise in this field.

Valuation of Management Rights

Management Rights business is valued depending on the value of the actual business plus the value of the manager’s unit.

Manager’s Unit Value

The manager’s unit value is obtained by comparing unit sales that are in the same or surrounding complexes together with a premium that takes into account the office space. The price of a manger’s unit is a non-income producing asset and if it is too high compared to the overall price of the business, the Management Rights Business is considered less favourable by a lender.

Management Rights Business Value

A Management Rights business is valued using a multiplier of the annual profit or income. The multiplier set depends on the market conditions that influence banks and other valuers. Normally, the multiplier ranges from 2.5 to 5.5 and depends on occupancy rates, location, and agreement term.

With many factors to consider, it is unlikely for two Management Rights Businesses to be similar. It is important to note that not all lenders offer finance to Management Rights Businesses and you should know the right lender to approach.

Big Business in the Form of Management Rights: Stories of Successful Hotels

Management Rights

Management RightsManagement rights in the Gold Coast make a good investment. An individual or a company can acquire a property with management rights to earn income. The amount spent on management rights leaves an impression that it is only a game for new investors. Nonetheless, some hotels prove that management rights are also big businesses.

ResortBrokers.com.au reports management rights in the Gold Coast continue to provide profits for investors and holiday accommodations owners. Find out who were successful in their venture:

Hilton Surfers Paradise Hotel

Hilton is a globally known hotel chain. In one report, Hilton Surfers Paradise Hotel’s management rights sold for over $50 million to a Chinese-Australian family. This hotel’s management right first came in the market last March together with the 160-room property. This closed deal adds up to Gold Coast’s property market, with some contributed by Asian buyers.

Soul Surfers Paradise Tower

Also situated in Gold Coast, the Soul Surfers Paradise Tower’s management rights is the most sought-after deal to date, with six major investors expressing interest in the offer. The property captured the attention of the Mantra Group, Ultiqa Group, and many other investors. They want to gain rights to the 77-floor tower with amenities that rival any other board and lodging business. The price for this deal remains undisclosed, but the number of established groups looking into the property indicates that it is worth the money and attention.

Southport Central Gold Coast Towers

Offering over 700 apartments, the three Southport Central Gold Cost towers’ management rights went to Vivo Property. Paying over $7 million for the towers’ management rights, Vivo Property is still not done with its other investments, as it started to look for other properties and management rights to acquire. Reports claimed the company’s search for new venture is triggered by the falling currency and boosted local tourism.

The Gold Coast management rights market continues to be active with the number of properties and rights on the market. Even if you are investing for management rights on a small motel, you can consider this as a good financial move with the current tourism market and the number of owners selling their accommodations.