jphothMember@jphothJoin Date: 2012Post Count: 2
My partner and i have just had an offer accepted on a Freehold motel in regional NSW. 20 rooms, restaurant and liquor license. Does anyone have an idea of the legal costs for completing the transaction. I have been quoted $4K and was wondering is this about right….thx
Valuation between $3-$5K.
Lots depends on how smooth the banks move.
Stock at value incl all liquor, food, room amenities, equipment maybe.
Allow for settlement adjustments for all utilities, subscriptions, ads, rates.
Some slow payers like wotif only settle 16th every month, expect loose ends.
We’re still sorting out loose ends 6 months later, nightmare issues, dream vendor, so it pays to maintain friendly relationships.
It’s a really long handover list these days depending on how many booking sources are involved.
Tech stuff includes domain names, websites, ISPs, email addresses, forward bookings, debtors, eftpos machines, ins, workers comp.
Start your list and leave plenty of room.
Hope it runs smooth for you.
thecrestjphothMember@jphothJoin Date: 2012Post Count: 2
Thanks for that thecrest – most helpful.
Good opportunity right now to assess how heavy weather affects motel properties for sale. Those unable to get flood insurance are at risk, according to the insurance companies.
If the motel is not covered for flood, then any interruption to business or any other event attributable to flood is not covered.
You wonder why some ppl ignore getting insurance. If the SES closes an area in case of flood, you can't claim interruption to business unless you're covered for flood, even if the event was a fizzer.
Not a fan of insurance companies, must be a huge club by now, and growing.
thecrestColdeskimoParticipant@coldeskimoJoin Date: 2013Post Count: 1
Has anyone come across a vendor wanting to disproportionately sell the building and the business. We have come across a vendor wishing to sell the property for 95% of the sale value and the remainder for the business. This places us in a few tricky areas 1. Higher stamp duty, 2. Minimal relief on future sale if using small business concessions. If there are ways around this please let me know as this is a deal breaker for us.
Sorry to be adding something so long afterwards, just found this question.
Obviously one for a good accountant. ATO may watch activity in this area carefully so best to get it right.
thecresttrungParticipant@trungJoin Date: 2015Post Count: 1
Thank you thecrest for being so helpful to us.
I’m looking 2 potential motels in the Mt Beauty town ( Tawonga), could u please give us ur personal opinion
freehold deal, no chain
1) location: situated in kiewa valley, mt beauty (Tawonga), victoria;31 km to fall creeks
2) facility: 2 acr land, 32 room, swimming pool + sauna; there s a restaurant can serve rougly 100 ppl
3) they re offering at $1M
My main concern is their performance during low season, cuz mt beauty is famous for ski activities, what happen when winter is gone. Either way, ur opinion is much appreciated
Seasonal areas depend on a good season. Snow area businesses in the Mt Beauty area face this every year so they may be a source of info. Check the snowfall charts for the last 50 years, as well as ABS occupancy graphs for your area. Examine the off season figures carefully to see if they could sustain you. 32 rooms + restaurant could do buses especially in the off season. Talk to the banker who is currently financing it. Read the last AAA report (SRA – now called Star Ratings Australia) for lots of details and recommendations. A valuation would be vital. Check the local price of 2 comparable acres of land. Any recent motel sales ? Check with LPI to see how much it was last sold for. Lots of detailed homework necessary. Start digging.
Let me know if I can help when you have some specific info.
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