I'm intrigued with this business of hotel flipping. What is your business model like for this? Have you been borrowing money for it? How do you handle the renovations and such? Do you get multiple projects going on at one time? How long is a flip on average? How do you find a buyer for a hotel? I have so many questions. Do you have any good reference material to advise (books, blogs, podcasts) for an aspiring real estate investor?
What I look for are hotels in smaller towns/cities. I try to stay around 50,000 or less population wise and the fewer hotels in the area the better of course. I stay away from larger chain hotels and look for options that are maybe 25-60 rooms.
I don't borrow any money for any project I take on. I've been doing it a while so I have plenty of spendable cash to handle the project.
I have 3 crews who have worked for me for years now. They will go where the next project is and I myself and not a big part of the hands on renovation. Financing, planning, decisions, and final call on what each project will include is more less what I do. I hire/keep folks who know what they are doing so in the end it works out very well for all of us.
On average a 40 unit hotel will take us about 3 months top to bottom. It always depends on what each property really needs to turn the corner and bring it back to life. If you know what to look for, it can be very profitable. I've bought hotels that were closed for 60,000.00 and after putting another 60,000 into it sold it a month after the reno work for 295,000.
As for finding buyers I have several ways. I've sold properties on craigslist, loopnet, and various other sites. A lot of times I have buyers on standby. They know what I do and want in the hotel business so they tell me what they would like as far as room specifics, profit margins, location, and what they can afford and then I find something that I can flip and fit into what they are looking for. Win/win for both parties.
As for reference materials, not really. I got started by buying a duplex in Knoxville(my 1st home purchase) as I was going to live in one side and rent out the other. Live mortgage free was the idea. It worked out so I quickly thought why could I not do this but on a much larger scale. Hotels just seemed to fit for me. Once you have the start up capital to buy 1 or 2 and the money for renovation it's very easy IMO to be profitable doing it. I have flipped a total of 43 hotels in the last 5 years and the money gets better and better each time. You learn what to do and what not to do. Sometimes a certain area is looking for more of a budget place so you keep things very basic and simple. Other areas you have to spend more as the locals will pay more for those rooms.
It was always my plan to buy them, fix them up, and sell them quickly. About a year into it I realized sometimes the money is better if you take the property on yourself, staff it, and now it's always making you money. If a hotel can be operated by a staff of 5-6 people and brings in 170,000 a year while the cost to run it is closer to 100,000, why not hold onto it a bit and keep that 70,000 for yourself? I actually now own 8 hotels myself in various parts of the country that are separate from my flips. I saw a reason to keep them and keep the profits vs selling them quick. It's worked out great. Once I have had/ran them for 4-5 years, I then sell them once the "new" has worn off. IF they are very strong profit wise, I may decide to reinvest in renovating it again and do I all over. Each property is different. You have to be able to make decisions quickly and roll with the punches.