酒店管理评测酒店价值评测XXXX(叶予舜)

UnderstandingHotelValuationTechniquesOctober2015Objectives‹‹‹‹‹‹Whydowedovaluations?Whyhotelaredifferentfromanyotherrealestate?Whatisvalue?UnderstandinghotelvaluationtechniquesConclusion:whatisimportanttohaveinordertoproduceagoodhotelvaluation?ConclusionWhydowedovaluations?Because:‹companiesinthestock‐exchangemarketneedtoupdatethevalueoftheirassetseveryyear;‹hotelownersmightbegoingtoabanktoaskforaloanofferingthehotelascollateral;‹hotelinvestorsmightbeinterestedinpurchasingaspecifichotel;‹hotelownersmightbewillingtoselltheirhotel;‹Acompanywouldliketomergewithanothercompanyandneedtounderstandhowmuchcapitaltheyarebringingthroughtheirassets;‹Manyotherreasons…Whyhotelaredifferentfromanyotherrealestate?Wehavealwaysbeentoldthatthepriceofanhotelisequaltothepriceoffivelittlegreenhouses…….ITISNOTTRUE!Whyhotelaredifferentfromanyotherrealestate?OFFICE=valuedonm2basisRENTEDONAm2BASISGENERATESCASH‐FLOWONAM2BASISRESIDENTIAL=valuedonm2basisRENTEDONAm2BASISGENERATESCASH‐FLOWONAM2BASISWhyhotelaredifferentfromanyotherrealestate?Hotelsarenotrentedonam2basisastheydonotgeneratecash‐flowonam2basisWhatisthebasisofhotelincomegeneration?Yotel,LondonGatwick(UK)BanfiCastle,Tuscany(Italy)WHotel,Barcelona(Spain)Whyhotelaredifferentfromanyotherrealestate?Hotelscashflowisgeneratedby:RoomsFood&BeverageGym/Spa/HealthCentreMinorOperatingDepartmentWhatisavalue?OpenMarketValueFairValueLikelyFutureValueInvestmentValueMarketValueResidualLandValueCalculationofWorth…MortgageLandingValue“Whatisavalue?“MarketValueistheestimatedamountforwhichapropertyshouldexchangeonthedateofvaluationbetweenawillingbuyerandawillingsellerinanarm’s-lengthtransactionafterpropermarketingwhereinthepartieshadeachactedknowledgeably,prudentlyandwithoutcompulsion.IVSC1HotelvaluationtechniquesFun‹10,000RuleBasic‹EBITDAmultiplier‹YieldExpert‹ReplacementCost‹SalesComparables–onaperroombasis‹NetPresentValueoffuturecashflowsHotelvaluationtechniquesFun‹10,000Rule‹Takethepriceofatinofcokefromthehotelmini‐barandmultiplyitfor10,000Example‹Cokeprice=4Euro‹Hotelvalue=40,000EuroperroomHotelvaluationtechniquesExample‹Cokeprice=4Euro‹Hotelvalue=40,000EuroperroomLimitations‹Priceofcokeinmini‐bardonotincreaseinthesamewayashotelcashflows(imaginea3staranda5starhotel)‹Thismethodologydoesnottakeintoconsiderationanyperformanceresultsforthehotel.Ifthehotelismakingorloosingmoney,roompriceisthesame.‹DONOTTAKEITTOOSERIOUSLY!!HotelvaluationtechniquesBasic‹EBITDAmultiplier‹YieldHotelvaluationtechniquesBasic‹EBITDAmultiplier‹Yield‹Takehotel’sEBITDAandmultiplyitbyamultiplierinaccordancetohotel’smarket,position,location,pastperformances,etcExample‹EBITDA=2,000,000US$‹Multiplier=12‹HotelValue=24,000,000US$HotelvaluationtechniquesBasic‹EBITDAmultiplier‹Yield‹Takehotel’sEBITDAanddivideitbyyourexpectedyieldExample‹EBITDA=1,000,000Euro‹Expectedlevelofyield=7%‹HotelValue==14,285,0001,000,0007%HotelvaluationtechniquesExpert‹ReplacementCost‹SalesComparables–onaperroombasis‹NetPresentValueoffuturecashflowsHotelvaluationtechniquesExpert‹ReplacementCost‐aidealaveragepurchaser,havinganaveragelevelofinformation,willverylikelybuyapropertyatamaximumpricethatisequivalenttothecostofbuildingasimilarpropertythatfeaturesthesamelevelofutility‹SalesComparables–onaperroombasis‹NetPresentValueoffuturecashflowsHotelvaluationtechniquesExpert‹ReplacementCost‐aidealaveragepurchaser,havinganaveragelevelofinformation,willverylikelybuyapropertyatamaximumpriceequivalenttothecostofbuildingasimilarpropertythatfeaturesthesamelevelofutilityExample‹Weneedmanyinformationsuchas:‹Constructioncostperm2‹FF&E‹Yearofconstruction‹…ReplacementCostPastToday••••ConstructioncostsLaborcostsFF&E…••••ConstructioncostsLaborcostsFF&E…ReplacementCostPastToday••••ConstructioncostsLaborcostsFF&E…••••ConstructioncostsLaborcostsFF&E…Technologyhasadvancedandnewbuildingtechniquesmakesbuildingtodaycheaperthanyesterday.ReplacementCostPastToday••••ConstructioncostsLaborcostsFF&E…••••ConstructioncostsLaborcostsFF&E…Laborcostshaschangeddrasticallyinthelast10‐20years.Thisisevenmoredrasticindevelopingcountries.ReplacementCostPastToday••••ConstructioncostsLaborcostsFF&E…••••ConstructioncostsLaborcostsFF&E…Priceoffurnitureandfixinghasreducedextensivelyyinthelastdecade.ReplacementCostDepreciationPastToday••••ConstructioncostsLaborcostsFF&E…••••ConstructioncostsLaborcostsFF&E…Aftertakingallthisintoaccountwestillhavetodiscounttheresultbackintimetoreflectthatthehotelwearevaluingisnotbrandnew(depreciation)ReplacementCostDepreciationIfvaluationmethodologyisthis,howwouldyouvaluethese?DunboyCastleResort,Cork(Ireland)CiraganPalaceKempinski,Istanbul(Turkey)LakePalaceHotel,Udaipur(India)ReplacementCost–limitationsDerivingahotel’svaluebycalculatingthecostofreplacingitanddeductinganallowanceforcumulativedepreciationUSES‹Easytobeunderstood‹UsefulfornewpropertiesLIMITATIONS‹Notalwayspossible,especiallyforhistoricalhotels‹Doesnotreflectinvestorrationale‹Depreciationcanbephysical,functionaland/orexternalHotelvaluationtechniquesExpert‹ReplacementCost‹SalesComparables–onaperroombasis:apotenti