{"id":407,"date":"2018-07-13T12:49:02","date_gmt":"2018-07-13T12:49:02","guid":{"rendered":"http:\/\/www.hotel-seeker.it\/?page_id=407"},"modified":"2023-08-21T10:39:06","modified_gmt":"2023-08-21T10:39:06","slug":"hotel-due-diligence","status":"publish","type":"page","link":"https:\/\/www.hotelseeker.it\/en\/hotel-due-diligence\/","title":{"rendered":"Hotel Due Diligence"},"content":{"rendered":"

Hotel due diligence<\/strong>\u00a0investigations are undertaken in different contexts and to achieve different ends. \u00a0Typically, these investigations are conducted by\u00a0buyers<\/strong>\u00a0and\u00a0investors<\/strong>\u00a0in the process of evaluating a hotel investment, and thus are tailored to the acquisition of a hospitality asset.<\/p>\n

The whole process involves some routine and some highly-specialized tasks, which can take the investor between\u00a0one<\/strong>\u00a0and\u00a0three<\/strong>\u00a0months<\/strong>\u00a0in the most widely-accepted versions of the process.\u00a0With the advent of the internet,\u00a0auditing<\/strong>\u00a0documents<\/strong>\u00a0has become much easier, thanks to the\u00a0digitization<\/strong>\u00a0of paper documents and to the ease with which one can access servers from all over the world, thus simplifying the first phase of due diligence in a hotel real estate investment.<\/p>\n

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  1. Market\u00a0due diligence: <\/strong>Analysis of the hotel asset\u2019s reference market, Analysis of competitors and the market, Analysis of current performance and projected future performance<\/li>\n
  2. Legal\u00a0due diligence: <\/strong>Verification of ownership of the asset\u2019s title, Sale and lease contract analysis, Checking the status of any litigation, Composition of a legal document checklist\u00a0<\/strong><\/li>\n
  3. Tax\u00a0due diligence: <\/strong>Tax conditions, Tax risk evaluation, External audit of tax position, VAT and tax reconciliation, Property tax projections and valuation\u00a0<\/strong><\/li>\n
  4. Real Estate, Technical &\u00a0Environmental\u00a0due diligence: <\/strong>Technical verification of the real estate, Monitoring land registry data and correspondence with the state of places, Checking for the presence of asbestos, Fire code certification\u00a0<\/strong><\/li>\n
  5. Financial due diligence: <\/strong>Pre-acquisition hotel evaluation, to determine the market value of the asset, Corporate and accounting audits, and outlining potential acquisition strategies (transfer of property vs. transfer of shares), Preparation of set documents to share between the parties, including the sale and purchase agreement<\/li>\n<\/ol>\n

    Pre-acquisition due diligence investigations are often performed by specialized professionals hired by the buyer or investor in order to reduce the risks associated with the acquisition of the asset. The due diligence process \u2013 facilitated by the seller \u2013 almost always begins with the signing of a\u00a0preliminary confidentiality agreement\u00a0<\/strong>known as an\u00a0NDA<\/strong>, or Non-Disclosure Agreement, the purpose of which is to ensure the confidentiality of all of the information made available to the purchaser.<\/p>\n

    During the analysis, the main objective of the hired professionals is to render as faithfully as possible the buyer\u2019s vision \u2013 legally and physically, technically and fiscally \u2013 passing on\u00a0any discrepancies<\/strong>\u00a0to the buyer in the phase of the hotel investment valuation<\/strong><\/a>. Following due diligence,\u00a0acquisition proceedings<\/strong>\u00a0can also be halted in cases in which the due diligence proceedings make it clear that completion of the transaction would be impossible, risky, or simply more complicated than expected.<\/p>\n

    In other cases, due diligence can bring to light minor deviations that do not impede the completion of the transaction, but instead, cause\u00a0adjustments in the price agreed<\/strong>\u00a0upon by the parties. Due diligence therefore fulfills its role of verifying, checking, and ascertaining the status of all elements that have the potential to be\u00a0critical to the acquisition<\/strong>\u00a0of hotel and hospitality real estate.<\/p>\n","protected":false},"excerpt":{"rendered":"

    Hotel due diligence\u00a0investigations are undertaken in different contexts and to achieve different ends. \u00a0Typically, these investigations are conducted by\u00a0buyers\u00a0and\u00a0investors\u00a0in the process of evaluating a hotel investment, and thus are tailored to the acquisition of a hospitality asset. The whole process involves some routine and some highly-specialized tasks, which can take the investor between\u00a0one\u00a0and\u00a0three\u00a0months\u00a0in the most […]<\/p>\n","protected":false},"author":2,"featured_media":24987,"parent":0,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"","meta":{"footnotes":""},"class_list":["post-407","page","type-page","status-publish","has-post-thumbnail","hentry"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.hotelseeker.it\/en\/wp-json\/wp\/v2\/pages\/407","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.hotelseeker.it\/en\/wp-json\/wp\/v2\/pages"}],"about":[{"href":"https:\/\/www.hotelseeker.it\/en\/wp-json\/wp\/v2\/types\/page"}],"author":[{"embeddable":true,"href":"https:\/\/www.hotelseeker.it\/en\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.hotelseeker.it\/en\/wp-json\/wp\/v2\/comments?post=407"}],"version-history":[{"count":13,"href":"https:\/\/www.hotelseeker.it\/en\/wp-json\/wp\/v2\/pages\/407\/revisions"}],"predecessor-version":[{"id":10130,"href":"https:\/\/www.hotelseeker.it\/en\/wp-json\/wp\/v2\/pages\/407\/revisions\/10130"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.hotelseeker.it\/en\/wp-json\/wp\/v2\/media\/24987"}],"wp:attachment":[{"href":"https:\/\/www.hotelseeker.it\/en\/wp-json\/wp\/v2\/media?parent=407"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}