Hotel rooms are sound alternative options for investors looking for a more diversified portfolio. The industry is a low-risk investment that promises high, often passive income. With the rise in global tourism in the past decade, many global investment companies are choosing to put their money in the hospitality sector, particularly in hotel rooms.
For one, hotel rooms double as commercial property investment and partial residence. They can be reserved for personal use. Many deals between investors and management involve agreeing on a time window during which the investor can reserve the hotel room for personal use.
To ensure steady profit and good returns, acquire a room in a popular hotel managed by world-renowned brands with established reputations. Depending on the arrangement, the investor gets a share of the whole hotel property’s income or takes a percentage from the room’s earnings.
Look for contracts offering a fixed rate of return because these remove monetary risks related to hotel maintenance and management. This is because rooms are considered part of the hotel, and are serviced as such. Also, any technology upgrades or renovations in amenities would be shouldered by the hotel itself and benefit your hotel-room invesment.
Born in Hampshire, UK,John Jefferis is an acclaimed hotelier who has 40 years of experience in the hospitality industry. He prides himself on his hands-on approach in managing his businesses. For more updates and write-ups on the hospitality sector, visit this blog.