The testament of the owner of a hotel in a premier destination in southern Spain meant not exactly an economic relief to their heirs. After a long legal battle that lasted nearly five years with regard to inheritance, the hotel fell into a considerable depression from the commercial point of view.
Once the lawsuit finished, BurgMaster Hospitality Consultants was mandated for selling the property in order to make the inheritance liquid, so it can be split among five people. As often happens, specially with people not familiar with the world of business and specifically the hotel industry, the difference between the amount expected from the sale and the amount offered by the market was huge.
Finally, the financial arguments provided by BurgMaster managed to persuade vendors. As it is known the price of a hotel is a function of its Income Statement and suggested therefore a sale in two stages.
The first was to identify a commercially competent operator, interested in the area and the hotel, an operator willing to manage the hotel for the time necessary to reposition it commercially and provide an attractive return, and once at this point the sale would be feasible at a convenient price.
The heirs accepted the approach. An open competitive process was launched between potential operators, of which BurgMaster could know their interests and abilities. Then, together with the customers, a choose was made maximizing the relationship between income guarantees and business perspectives.
The heirs accepted the solution and the transaction was completed. The new rent was significantly higher than the annual profit made until then with the direct exploitation and the market value of the asset would increase considerably.
