Financing Institutes

HOTOUR has a long-standing history in advising financing institutes. The most frequently asked questions are the following:

Is the lease sustainable?

What is the amount of sustainably achievable lease (cash flow – in case of management contracts) for a particular hotel?
The scope of a lease can be clarified by applying a Quick Check. Precise lease calculations require a thorough and more detailed analysis of the hotel project. The achievable lease depends on the location, market, category and operating concept of the hotel and can be determined through an Appraisal reports of the leasehold value. If the debt service coverage of a hotel is subject to evaluation, we determine – depending on the requirements of the financing bank – either the sustainably achievable cash flow (management contract) or lease.

Concept plausible?

Does the operational concept meet the market requirements?

In order to check whether the product positioning, real estate, marketing and operating concept, personnel planning and efficiency of an existing hotel or project are feasible, we review the operator’s or borrower's business plan and verify its plausibility (Analysis of Business Plan). If no business plan should be available it is recommended to use a Appraisal reports of the leasehold value.

Market value of the hotel?

What is the market value of a particular hotel?

Appraisal reports are prepared on the basis of a profitability calculation and performed either by applying the earnings value method (according to german WertV) or the internationally used Discounted Cash Flow (DCF) method.

Alternative use for property?

Is the hotel property suitable for a third-party use - meaning by an alternative operator?
Depending on the objective and required level of detail this question can be answered either through a Quick Check, an Appraisal reports based on the leasehold value or an Analysis of Business Plan .

Restructuring of the operation?

Is it worth restructuring the hotel operation?

This question can be answered thoroughly within a Restructuring analysis (according to German IdW Standard and adapted to the needs of the hotel industry). An initial feedback can also be given through a Quick Check.

Reference list

  • Bayerische Landesbank
  • Berlin Hyp AG
  • Deutsche Hypothekenbank AG
  • DG HYP Deutsche Genossenschafts-Hypothekenbank AG
  • DKB Deutsche Kreditbank AG
  • Morgan Stanley