The most important rule is to always seek expert industry advice before buying. This is crucial.

You can start your research online and talk to friends or relatives with industry knowledge. But always remember that expert knowledge is key. 

When looking to buy, seek out experienced motel industry professional agents, not those who ‘dabble a bit’ and are just looking for a sale.

Research regions that offer the best motel opportunities and returns, both now and into the future,

The popularity of beachside motels continues to grow with both guests and motel buyers, but when demand is high it’s reflected in the purchase price, historically motels on or near water have always fetched a higher price.

Regional motels are popular with the domestic drive market. 

Obviously consider a motel’s proximity to major highways and tourist drives.

Assess what local activities, attractions, or businesses will consistently bring visitors to the area. For instance, is the motel near an airport, hospital, shopping centre, a theme park, museum, events centre or park, wineries, breweries, or golf course, and note that it is preferable to have more than one attraction in the locality.

Decide if the location will fit in with your family and lifestyle requirements.

Look at the preferred tenure of ownership that suits you, whether it be freehold, freehold passive investment or leasehold. 

Twenty years ago, most motel owners lived onsite but today many operate under management or under lease. 

It’s important for a prospective owner to have a finance expert provide pre-approval for a loan early in the search because it will save time, money and disappointment. 
Andrew Morgan from Queensland Tourism & Hospitality Brokers recommends to also look at the number of units in a property because, generally, the more units the higher the price.
 

You may see an opportunity to add on a product or service that the motel doesn’t already offer, for extra profit. 

Ask, does the motel have the capacity to add on a restaurant or dining facilities and could adding one turn a profit?

No capacity for a restaurant? Then is there an opportunity to sell simple breakfast, lunch and dinner packs or picnic boxes to turn a profit?

Can you add vending machines or a coin laundry?

What about the addition of a play area or pool to attract more families.

Is there a business opportunity for events?

The standard of presentation of a motel will obviously affect the return on investment. 

Be warned, there is a sweet spot when it comes the ideal time to renovate. Generally, it’s before occupancy rates and nightly tariffs are so detrimentally affected by a poor environment that profit is so low you can’t afford to refurbish to a reasonable standard. 

If that time has passed you need to consider how much you would need to spend to rectify poor standards or years of neglect. 

However, a run-down motel might be a steal and provide you with an excellent opportunity to bring your own modern style, or even a retro twist (retro motels are very on trend right now) to the motel, and importantly could be your chance to add real value.

We have many new and old motels for sale on AccomProperties.