Question: What is the best location for a motel? Inland, coastal, north, south?
Answer: All of the above.
Question: What is the best position for a motel? Highway, CBD, suburbs, beachfront, riverfront?
Answer: All of the above.
The right location depends on numerous variables and on each individual property and business. Of course, there is no “best” location for a motel. All the things that go into making that business or property what it is, such as location, presentation, the operator, the standard of beds, the local economy, the services provided, marketing, etc, etc, all play a role.
There may be locations where the economy is performing stronger than others at one time or another. Certain positions within a locality may also be performing better for specific reasons. I have been asked the question many times in the past, as to where the best place is to buy a motel. There is no one answer to this question. I guess timing also plays a part here, as mentioned, with fluctuating local economies and how they are performing. An excellent example of this is Mackay. It performed extremely well until the resources sector had a downturn. Now the local economy there is improving significantly and many experienced motel investors are now taking their opportunity to buy back into Mackay.
I often have enquiries from people wanting to buy their first motel and invariably they want to limit their search to one town or location. This is fine when buying a house as the decision is largely based on where they need to live for employment, family or retirement purposes. When buying a business however, limiting one’s search to where they want to live disadvantages them considerably. It is the best way to buy an unsuitable business as it is based on the wrong reasons.
One should always be looking for the best business that suits their requirements. Therefore, if return is the driving force so be it. If the type of business is, great. But limiting a search for a motel for example to one area, means the best business opportunity for them may end up being written off as an opportunity lost.
Obviously, this does not mean going and buying a business that is, location wise, completely unsuitable for family reasons or another. It simply means don’t limit one’s self. Keep the options and possibilities open. Explore different areas of the state that may not have been considered suitable. A lot of the time people end up finding that the perfect motel for them was not what or where they had considered going at all when they first started out looking.
A common objection we hear a lot is that someone years ago in their infinite wisdom told them that “any town” was not a good motel town or that they should steer clear of a particular town for some “wonderfully incorrect” reason. I say, have a look at all the details and facts about the locality and the business, then make your own mind up.
As a young man in a hurry 20 years ago, I was told by a very experienced and successful man I worked for and respected greatly, that when making decisions in business and life I should “listen to the advice given to you by your trusted people (accountant, solicitor, financier, parents, etc). Take that advice on board, go with it, go against it, but be your own man and make your own decisions”. That advice has stayed me, and I have continued to use that advice, and I suspect even used it subconsciously each day since. This is relevant in that only the person making the decision to buy the business is the one who can truly make the right decision for their own reasons, and in their best interests.