Hotel Improvement Analysis – Product Improvement Program

Over the next few posts I will discuss some key areas of hotel appraisal.  The Lakvold Group has years of experience performing hotel appraisals in Baton Rouge, New Orleans, Lafayette and other cities throughout the state of Louisiana. One of the key considerations in hotel appraisal or valuation is the analysis of the improvements.  The improvements are generally subject to a periodic Product Improvement Program (PIP).  Most franchised operations must comply with the PIP requirements.  Property owners are required to complete capital...

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The Cost Approach to Commercial Appraisal

In real estate appraisal, there are three basic valuation methods.  The cost approach is the one that we will focus on for this article.  The other two are the sales comparison approach, and the income capitalization approach. As with the income capitalization approach and the sales comparison approach, the cost approach is a valuation based on market comparisons.  One of the primary distinguishing factors of the cost approach is that it separates the property into a land component and a building component. As a general rule, the cost...

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