Hotel pre-acquisition: which analyses before signing?
Acquiring a hotel or motel differs fundamentally from residential real estate: value depends on the operation (RevPAR, GOP, EBITDA), not only on surface area. An informed decision requires six analytical angles: income-based valuation, debt coverage, operating forecast, energy compliance, competitive positioning, and — for international buyers — E-2 visa eligibility.
Method: combining income and comparables approaches
Professional hotel valuation blends two methods. The income approach discounts stabilised EBITDA at a capitalisation rate reflecting operational risk (5-9% depending on category). The comparables approach applies a price per key observed on recent transactions (€40k-€350k by segment). The retained value is typically a weighted average.
USALI: the common language of hotel P&L
The Uniform System of Accounts for the Lodging Industry (11th ed., 2014) standardises hotel P&L presentation worldwide: Rooms / Food & Beverage / Other Operating Departments, then fixed charges, FF&E reserve (4% standard) down to EBITDA. A buyer reasoning in USALI communicates in a standardised way with banks, appraisers and operators.
Frequently asked questions
What is the difference between GOP, EBITDA and net income?
GOP (Gross Operating Profit) = total revenues − operating charges; the operator's performance indicator. EBITDA = GOP − FF&E reserve (4%); the debt-service capacity indicator used by banks. Net income = EBITDA − interest − depreciation − taxes; the accounting result.
Can a hotel in France or Belgium be valued with these tools?
Yes. RevPAR, EBITDA, DSCR and USALI methods are international standards. Only the Klimabonus tool is specific to Luxembourg. For a cross-border project, use the 5 other tools and adapt renovation aids to the local scheme.
What is the difference between business (fonds) and walls?
Walls (real estate only) are valued by rent × capitalisation rate. Business (operation) is valued by EBITDA × multiple. A freehold buyer pays the sum of both. Our tools treat hotel operation as a whole, including productive real estate.
Do I need a TEGOVA expert for a bank?
For a secured hotel loan (>€1M), most LU/BE banks require a TEGOVA EVS 2025 report signed by a qualified appraiser. Our tools allow pre-qualification of a file before ordering that expert work.