Selling a hotel in the German-speaking market
Selling a hotel in Germany, Austria or Switzerland
A hotel is not valued by the square metre, and it is rarely sold in public. Buyers look at the earnings the business sustains, at the contracts attached to it and at how much of the result depends on the current owner. That is why a sale starts with the numbers and not with a listing. Most of our mandates are placed before they ever reach an open market, and for an owner that is usually the point. Staff, guests and lenders tend to find out about a sale long before a binding offer exists.
Why most hotel sales never reach the open market
A planned sale rarely stays quiet for long. Staff hear about it, suppliers ask questions, and sooner or later the subject reaches the bank. For an owner that can have consequences months before any binding offer exists.
Regular guests react as well. Someone who has come back for years will wonder whether the kitchen, the management and the character of the place will survive a change of ownership. The uncertainty hits the business at exactly the moment when its figures matter most to a buyer.
We therefore approach buyers one at a time. The name and precise location of a confidential mandate are released only once confidentiality has been settled.
What a buyer looks at first
A buyer wants to understand how reliable the result is, and then how much of it survives the handover. Figures have to be traceable. Contracts have to be findable. The peculiarities an owner has lived with for years should not surface for the first time during the buyer's due diligence.
Owner-operated hotels are the common case in this market, and they share a common issue. The owner's own working time appears in no profit and loss account, and often the same is true for family members who work in the business. A buyer has to pay for those positions. Unadjusted, the result looks better than it is.
What German market practice expects
Several documents are standard here and a buyer will ask for them early. We collect them with you before the first approach rather than after it.
What is different about a leased hotel
Where a hotel is let to an operator, the lease often matters more to the price than the location does. A long remaining term with a solid tenant supports the value. A rent above what the business can carry does the opposite, even if it is being paid today.
A high rent is not automatically a good rent. It has to be in line with the market and the tenant has to be able to earn it over the full term. A rent above that level survives until the first weak season, and what follows is either a renegotiation or a vacancy.
Questions and answers
Do you work with international sellers?
Yes. We advise in English and German, and we are used to reporting into an investment committee that sits outside the DACH region. The documentation follows German market practice, which we explain rather than translate away.
What does it cost?
We work on a success fee. The rate depends on the purchase price and is agreed in writing before the mandate starts. There is no charge for the first conversation or for an initial view on value.
How long does a sale take?
Several months is normal. The buyer search is not always the slow part. More often the delay sits in the preparation, because figures need explaining, contracts have to be collected and open items are better resolved before a buyer finds them.
Will my staff find out?
Not through us. Before a mandate is signed we speak to nobody about your hotel. Within the mandate we release confidential information only to parties who have signed a Vertraulichkeitsvereinbarung, the German non-disclosure agreement.
Let us talk about your hotel
A first conversation costs nothing and commits you to nothing. You will learn where your hotel stands in the market and which routes are open. If we are not the right people for what you have in mind, we will say so.
- Telephone
- +49 211 239 554 0
- Response
- within 24 hours
Your contact
Timo Hofmann
Managing Director
- Direct line
- +49 211 239 554 09
The direct line reaches him, not a switchboard. English and German.
Related
What usually comes before or after a sale.