I have just brokered a transaction in Saskatchewan for a $12 million property that sold for $4.175 million.
Why? The relatively new property located in a decent sized smaller town was hit by the oil and gas downturn with the subsequent reduced occupancy and rack rate all of which of course dramatically reduced the ADR and RevPAR. In short, the capitalized value was savaged.
Recent Hotel Sales
My associate and I transacted a total of 5 hotels and motels in 2019 which is a marked increase over 2018.
One was sold for a planned change of use but will still operate as a smaller town motel until the new owner is able to get his project in place. One was an operating property under receivership but it still captured a value close to what the owner wanted. Most encouraging, one was purchased on the basis as noted below. It made sense to the buyer and the seller was prepared to meet the market as it now exists.
This speaks to what seems to be the new attitude of purchasers and owners which recognizes economic realities.
Purchasers – “If this is the new normal, I am going to seek out opportunities that make sense in this economy and I am going to run a successful hotel or motel.”On the other side of the market, here’s an encouraging report from spending an evening with the Rockies SKAL club and then overnighting at the New Malcolm Hotel in Canmore, Alberta.
Owners – “If this is the new normal, I am prepared to set my price at today’s value to secure a successful sale of my property.”
|Unique & Elegant|
|Conference room set for outstanding feast.|
- Beautifully Appointed Rooms
- Excellent Food Service
- Heated Indoor Pool
- Year-Round Heated Outdoor Pool
- Inviting Hot Tubs (I had a great soak under stunning starlit mountains.)
- Free Guest Parking
My wife and I had a great time enjoying the amenities and this great location featuring the world famous mountain views Canmore is known for!
Like most hotels and accommodation locations in Canmore, The Malcolm expects a year-round healthy occupancy and will have a strong repeat business record. It is also ideal as a corporate Event Centre.
These News Pieces: will be provided on a periodic basis when appropriate to provide useful and interesting information.
Tim Anderson – Hotel and Motel Specialist
Licensed Real Estate Associate – Royal LePage Commercial403-862-4179 // andersoncommercialrealty.com // firstname.lastname@example.org