The Challenges of Hotel Conversions
The challenges that a hotel conversion presents can be wide-ranging depending on the ideas that you have for the space. Everyone has different idea about what can be done with a particular building, and you have to think practically if you want your new project to get off the ground. Investing in, renovating and the financing of a hotel conversion is a big job that requires a great deal of thought.
When you are thinking about taking an existing hotel and converting it, you will have to find a way to finance the project. This means that you need investors to help you along. This could mean borrowing money from the bank to purchase the property. However, you must remember that because this is a hotel conversion, you are going to have to make additions and renovations to the building. Therefore, you will need to apply for a construction loan.
In the case of opening new apartments, you will already have most of necessary components in the room, but the room will still require some renovation. The rooms will need to have kitchens installed and slight modifications made to the existing structure. You will have to hire a contractor to complete the job. The contractor can tell you what it will cost to convert each room and give you a timetable as well.
If you are thinking of starting a senior living community, you may have to make the same renovations, but there will be other considerations as well. If the facility does not have an elevator, then this must be installed.
When you are thinking of making each room into an office suite, the room is going to have to be completely renovated. You might even have to move the bathrooms to offer more space. Moreover, you will have to completely remodel the lobby of the hotel to make it look more like an office building. This requires yet more quotes from a contractor.
When you take this information to the bank or to an investor, you will have to go with a business plan as well. The easiest way to get a loan approved or to get a capital infusion is to show the people who are giving you the money that your business can turn a profit. This means you need to have consulted with some professionals who already work in the industry you’re in getting into to check your business plan. Then, and only then, can you go to a bank or an investor for the money you need to make this project work.
How to avoid any problems
You will run into pitfalls with any hotel conversion, but some planning and consultation can make any project possible. All of that planning is what you show to the bank or your investors in order to procure the funding you need. After you are fully funded, you can convert the hotel into your new vision for the property.