Looking for opportunities in hotel investment for sale UK?
Hotel investment is a relatively new concept based on other types of real estate investment and has resulted from investors in leisure property needing to raise capital for the purchase and/or development of a hotel or a resort. Banks often do not provide loans for these types of property purchases or development providing huge opportunities for the public to invest in the hotel industry and make relatively quick and profitable investments.
But where can you find a hotel investment opportunity and what should you look for in a operator or property investment provider?
Going online is of course the best way to find multiple opportunities for these types of investments. The popularity and profitability of these investments has led to real estate and property investment companies jumping onto the band wagon and the availability of hotel investment for sale in UK is on the rise. However, while finding an operator is quite easy, ensuring that you are making a sound investment with a reputable company is a little more complicated.
There are two ways in which hotel investments are profitable. Firstly, you will receive a percentage of the profits and benefit from growth. Secondly, the operator will “buy back” your investment portion after the specified lease period has expired, usually at a higher price than you initially paid for the investment. It is important to ensure that the operator you choose provides both these returns and compare percentages between different providers in order to get the highest return.
The greatest risk that you run in this type of investment is that the company buying or developing the hotel may go under. It is therefore critical to research the company and ensure that they are financially stable and that this is not their first time around the block. A company that has a good track record in hotel investment for sale UK is the best option.
It is also recommended to check whether the investment opportunity is SSAS and SIPP compliant. These investments are not regulated by authorities such as the FCA and the Financial Services Compensation Scheme and you will have little recourse if the investment goes south.
Most operators and investment providers offer a guaranteed returns which is another factor to look for when choosing the investment company. It is also advisable to do a little research into the hotel that you will be investing in, its location and history.