Buyer & Seller Advisory for Hospitality Businesses
In today’s challenging business environment, buyers and sellers of hotels, resorts, restaurants, bars, and mixed-use developments need seasoned hospitality professionals on their team. Cayuga’s transaction advisors provide objective evaluations that help maximize value and achieve optimal deal structuring.
Meet Our Buyer Seller Advisory Consultants
Tim Sullivan
Profitability & Operational Excellence
Jay Landfair
Asset Management/PIP/Project Management
Ray Minias
Ultra-Luxury Development/Design Exec.
Sean Flakelar
Luxury Boutique Resort & Restaurant Ops.
Daphne Gezen
Hotel & Branded Residence Advisor
Greg Riehle
Legal, Risk Management, Arbitration
Camilla Jensen
CFO, AI, Strategy & Transformation
Donald Hoover
HR training, development, deployment
James Miles
Independent Resort Ops & Development
Preston Rideout
Nightclub and Dram Shop Expert
Ken Edwards
Receivership, Asset Management, Training
Bill DeVinney
F&B Concept, Operations, Multi-Unit Dev.
Eric Rubino
Acquisitions/Investment/Deal Structuring
Joseph Cozza
Catering Sales & Event Operations
Jon Peck
Acquisition Advisory & Asset Management
Dan Voellm
Asset Management & Valuations
Shirley Whelan
F&B Concept Development & Management
Stewart Kiely
Design/Project Management/Sustainability
Sean Skellie
Hotel Development & Marketing Analysis
Charles Oswald
Hotel & Asset Mgmt, Hotel Underwriting
Simon Turner
Expert Witness, Asset Mgmt, Transactions
Charis Atwood
FF&E Project Planning and Management
Mandy Murry
Independent Hotel Coaching
Perry Smith
Restaurant & Club Operations, PR, Branding
Gary Isenberg
Hotel Stakeholder Advocacy & Development
John Berndt
Operations & Asset Management
Jill Lekstutis
Hotel Development Advisor
Tom Lambrecht
Debt Restructuring, Loan Packaging
Directory
Cayuga’s hotel, F&B and hospitality advisors have decades of experience in leadership roles in virtually all segments of the hospitality industry including:
- Hospitality Management Assessment Organizational Development
- Investment Analysis, Appraisal & Valuation Consulting Services
- Hotel Property Evaluation Consulting
- Hospitality Development, Acquisitions & Owner Consulting Services
- Site Selection, Land Use & Planning
- Design and architecture
- Hospitality Investment Analysis Consultants
- Expert Witness & Legal Advisory Consulting
- Hospitality Development, Acquisitions & Owner Consulting Services
- Buyer & Seller Advisory for Hospitality Businesses
- Hospitality Sales, Marketing and Revenue Management Consulting Services
- Hotel Appraisal & Hotel Valuation Consultants
- Deal Structuring
- Exit Strategy
Hospitality Investment Advisory Services
Our professionals have a deep understanding of the issues that owners, financial institutions, and operators are facing. Whether you are seeking to invest in a single property or a multi-unit acquisition, our professionals are able to:
- Provide asset evaluations for hotels, resort, restaurants, casinos, event venues and more
- Make recommendations on the market and location
- Review current branding and offer solutions for hotel brand conversion
- Advise up-branding or repositioning
- Assist with franchise negotiations and contract review work with land planners, architects and designers
- Evaluate management company performance with recommendations for improvement or alternatives
Asset Evaluation Services
When you evaluate whether to buy or sell an asset , rigorous due diligence is required. Our asset experts are fiscally and strategically focused and are able to help you with:
- Analyzing opportunities for revenue enhancement and maximizing returns for your hotel, resort, restaurant, event venue or casino
- Preparing property condition reports
- CapEx/PIP reviews and plans for replacement and renovations
- Project management
- Financial forecasting and revenue optimization
- Procurement, GPO, and vendor evaluations
- Assistance with closing due diligence and asset opinions of value
- Trusted guidance from our advisors
How To Buy A Distressed Hotel
The obvious question is why is the hotel distressed in the first place. These questions must be fully addressed before proceeding. If the property is generally well located the asset may have upside potential that can be resolved with the right approach. A Cayuga acquisition consultant will provide an expert evaluation that will allow the buyer to make informed business decisions.
Potential root causes for poor performance include:
- Operational challenges and miss-management resulting in poor customer satisfaction.
- Poorly marketed and/or positioned resulting in poor revenue generation.
- Product quality – poorly maintained.
- Lack of cost management resulting in poor cash flow to the bottom line.
- The brand is not a good fit for the market and/or product.
- Over leveraged and cash flows do not cover debt service.
Cayuga hotel buying consultants will identify the root causes for poor performance, provide strategies for correcting issues, estimate expenses to rectify the problems, provide the buyer with a price point that will allow a fair return on investment and assist the buyer in negotiations with the seller.
Prices of distressed assets should be well below replacement cost and with higher cap rates. The challenge is choosing the deal with the most significant upside potential and offering the best return.
Steps To Identify And Buy A Distressed Hotel
- Examine the market for Distressed Hotel.
- Review the property and its historical performance.
- Determine if the brand is appropriate for the market.
- Examine performance vs. direct market competitors.
- Perform an expert property condition assessment.
- Identify revenue opportunities and net operating income.
- Create a financial model to justify equity investment and/or to acquire loans.
Frequently Asked Questions When Preparing Your Asset For Sale
What questions are sophisticated buyers asking?
Before you market your hotel or restaurant asset for sale, you should already know the answers to the most important questions. Questions that any sophisticated buyer will ask. Knowing the answers, and positioning your asset before listing will stop surprises during the buyer’s due diligence process. It will also provide on your investment.
Owners learn more about their hospitality business during the sale process than ever before. Don’t get surprised by your buyer’s due diligence. Prepare in advance.
Why are you selling this asset now and what's your exit strategy?
You should know this answer before you start work on any of the other questions. Common reasons include:
- Is it time to cash out on a top-performing asset?
- Do you need to adjust portfolio exposure in particular markets or brands?
- Are you focusing on other development opportunities?
- Do you lack the resources necessary to maintain the property?
- Are you looking for an investment or management partner?
A sound exit strategy, put in place and then reset to current conditions, greatly increases the likelihood that when you exit your hotel investment it will be on the most favorable terms available, and that your return over the holding period is optimal for the circumstances. By modeling likely income and realistically projecting the debt the property can support over at least the next five years, you can quickly pinpoint both opportunities and roadblocks. Knowing your reasons to sell also makes it easier to evaluate offers and respond to due diligence questions from potential buyers.
Allow Cayuga Hospitality Consultants to put together a team of experts to help you answer these questions and more when it comes to selling your hotel or restaurant asset.
How is your property maximizing its revenue potential in its market?
Hotel and restaurant asset pricing is all about value, and nothing drives asset value more than top line revenues.
- How is your property positioned in its competitive set?
- Is the property capturing more than its market share of rate, occupancy, and sales?
- Are there opportunities to improve market position or economics through improved selling, marketing, re-branding, renovation, or re-development?
- Are there barriers to entry in your property’s market?
- How stable is your property’s revenue stream?
It is critical to know both the opportunities and the risks that the property faces in its competitive market, and the associated impacts on revenues.
How is your property operated at peak efficiency and customer satisfaction?
Management and operations are the foundation that supports top line revenue. They are the engine that delivers product quality and profit through customer service delivery and efficient hotel and restaurant operations.
- Do you have the right Management Company operating your property?
- The right management team?
- Is product delivery and customer satisfaction at the high end of the scale?
- Are labor costs in line?
- Is the building operated and maintained?
- Are there cost savings opportunities?
Improving customer satisfaction, and operating at peak cost efficiency contribute to top line revenue, improve operating profit, and boost property value.
What is the condition of your property or asset?
Property condition is of equal importance to customer service in supporting hospitality product delivery. The friendliest staff in the world cannot make up for a broken down mattress, worn out carpet, or non-functional air-conditioning.
- Will the sale of the property trigger a Property Improvement Plan (“PIP”) rule by the brand?
- How extensive will the PIP be?
- Are there any deferred maintenance or deferred capital issues?
- Unmet regulatory or inspection requirements for elevators, fire and life safety systems, ADA, VGBA, EPA, OSHA, etc.?
- What will re-branding opportunities need in renovation and CapEx costs?
A well-maintained asset contributes to property reputation and repeat business, improves operational efficiency, and lowers the risk of equipment failures and service disruption. Well maintained properties also generally enjoy lower R&M and capital costs over the long term.
