Financial Analysis of Hotel Investments
A hotel’s real estate is one of its most valuable assets and it is essential to be able to accurately value this critical investment. To be successful, hotel investors must be able to determine the financial interests of those involved in any project: the owner, the operator, and the lender.
In this course, Professor deRoos demonstrates several analytical tools used by real estate professionals to evaluate hotel investments. You will explore how owners, operators, and lenders evaluate potential hotel projects. Using an Excel-based tool, you will estimate the return on investment and return on equity for a hotel investment.
Debt and equity financing are critical to every project and in this course, you will learn how to estimate the size of a mortgage loan given the lender's requirements. With real-world examples, practical tools, and opportunities to practice, you will develop the skills necessary to structure your own hotel real estate investments.
Who Should Take this Course?
This course is designed for managers and professionals with financial or operational responsibility of hotel real estate, investments, financing, or asset management including asset managers, and portfolio managers; professionals working for or aspiring to work for real estate funds, REITs, real estate developers, real estate advisory firms, and others affiliated with the creation and use of real estate as a financial asset, focused on hotel real estate investment projects.
Participants who complete this course will be able to...
Explain the varied motivations of owners, operators, and lenders in pursuing real estate investments
Examine the different investment approaches taken by owners in the hotel industry
Estimate the return on investment and the return on equity for a prospective hotel investment
Estimate the value of a proposed hotel using a variety of methods
Analyze and evaluate investment projects from the perspective of owners, operators, and lenders
Size a mortgage that meets the needs of different partners
Make informed decisions about the relative attractiveness of hotel investments
Module 1 - The Hotel Owner-Operator-Lender Partnership
- Partnering Owners, Operators, and Lenders
- Different Owners Have Different Reasons to Invest
- How Equity Plays the Game
Module 2 - Evaluating the Deal--How Owners, Operators, and Lenders Evaluate Proposed Projects
- How the Owner Evaluates the Project
- How the Operator and Lender Evaluate the Project
- Overview of Hotel Market Valuation Methodologies
Module 3 - Structuring the Deal--Current Equity and Debt Financing Structures
- Hotel Financing Cycle--Equity Financing
- Hotel Financing Cycle--Debt Financing
- Course Project--Investment Construction and Analysis
- Prof Jan de Roos, Associate Professor and HVS Professor of Hotel Finance and Real Estate, Phased Retiree, School of Hotel Administration