investment in a motel…good or bad?

[damonk007]

Generally speaking, is the motel business a good mid to long term investment (> 5 years)?

I am doing some preliminary research (due diligence) on a motel in Niagara Falls…any pitfalls I should be aware of? Thanks!

[damonk007]

I’m not a motel expert but i do know quite a bit about tourism. The NFalls area has an absolute glut of motels and visits from the US have dropped precipitously .

Also, the busy season is summer of course, and a little bit around Christmas. Beyond that, it is very dead there with some motels shuttering for the season to reopen in Spring.

Another potential knock is that the US side casino now has a new area where 18 year olds can go gamble. in ontario it is still 19.

[CSK’sMom]

Many of the motels are being knocked down on the Lane. Whats left is synonymous as crack and hooker motels. With all the new hotel builds in tourist central, no one wants to stay in the fleabag motels, especially when there are always killer deals through several sources. The Seneca is not an issue in any way, other than entertainment venue size which is about to become a moot point. Fallsview is undertaking a multi-million dollar renovation.

[HeavenLeigh]

Considering you will really only be making money during the 3-4 months in summer during tourist time I would say it’s a bad investment.

[armoredfilms]

I’m from a tourist town. There are plenty of tax benefits to being in the hospitality business but as a general investment, I’d only gamble on the real estate portion. I wouldn’t count on an income from guests. Have you explored a B&B option?

[Author]

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