Starting a hotel


I would like to start a hotel over the next few years. I know I will need a lot of capital to do so. I am working on getting the capital right now but I would like to know what a realistic amount to work for. I would like to buy a small 40 to 80 room hotel, put in a bunch of improvements and get it up and running. I most likely will be opening it up within about 50 miles of Seattle, but that could easily change. I know no one can give an exact number, but could someone least tell me how many zeros to expect and what the leading number might be?

I am not apposed to franchises. I know that just adds on more costs but they normally have a pretty good ROI.

Also, right now I am planning on getting a small portion of that amount and getting a loan from a bank for the rest. If this is a bad idea or you know of a better way please let me know. I know there is a lot of risk this way, so any help would be great.

Lastly, I know a lot about running a hotel. I have spent many years in this industry. I just have never started one before and don't know the first steps. I've been wanting to do this for many years now and I am finally in a place in my life where, except for the fiance issue, I can do this.

Startup Costs Investment Loan Cost Estimation Franchise

asked Mar 31 '13 at 06:06
11 points
Get up to $750K in working capital to finance your business: Clarify Capital Business Loans
  • You should be using your contacts in the hotel industry to find someone to answer your question. I seriously doubt there are people on this forum who have the expertise you need. – Kekito 11 years ago
  • If you know a lot about running a hotel, then you should know enough to contact a commercial realestate broker and see what hotels are selling for in the area you are interested in. Then you should check with mortgage brokers to see what financing is available. Do your basic research. No one here can do this for you. – Gary E 11 years ago

1 Answer



Its funny to look at your question. When it comes to business you should be alert and effective. Few advice

1.Why would you buy a existing hotel ? Why do someone will sell theirs ?

2.No one on this earth can give you the quotation. It varies on your cost-cutting policy, salary schemes, negotiation skills etc.

3.I dont think you will get loans easily, if you dont show them your income certificates.

4.Buying a big hotel as a start up business is kinda sounds stupid to me.(No offense i am trying to help you.)

5.If you're sure about a hotel business, buying a hotel in loss is not a good idea unless if you're legend and already owning couple of hotels. otherwise No-No.

6.Start small, stick to quality and service , grow up. Thats the best policy.

7.Getting load, investing everything you have, Taking risk beyond your strength for a startup may end up anywhere. Because you need 10 times of money you actually investing to run the hotel.

8.To buy Raw materials, salary, furnitures, painting, Chef, cooks, other consumables need a lots of cash to run the business.

9.Any startup, you cannot expect profit for nearly 2 years.

10.If your hotel business takes $5000 investment, you atleast need $25000 in bank to run it without flaws.

answered Apr 12 '13 at 19:30
187 points

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