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Hotel 2

How to Buy a Hotel

If you feel like you are ready to buy a hotel, here are some things to consider.

It’s an exciting time to buy a hotel in South Africa as the industry is projected to continue to grow over the next few years. Throughout Africa, there is an increasing number of hotel chains popping up and more and more hotels are wisening up to the advantages of offering online services.

If you feel like you are ready to jump into this sector, here are some things to consider before you buy.

Industry Overview

Revenue from South Africa’s hotel industry continues to rise and there are predictions that it will continue to do this over the next few years. Despite a lot of economic uncertainty, tourists continue to flock to the country and this is great news for anyone looking to buy a hotel.

There are a lot of global trends that are appearing in the hotel industry and South Africa is not being left behind. Hotels are ‘teching up’ and looking at the full guest experience to make sure that they stand out in a competitive market.


Running a hotel does not come without its challenges. It is extremely time consuming and it is a business that often comes with long hours.

The staff that you employ will be an important step in making sure that your guests are satisfied with their stay. Staff training is vital as is making sure that your staff are happy coming into work, which in turn will make their interactions with the customers pleasant and helpful.

The more that the hotel industry operates online the more important that it becomes for hotels to have a unified guest engagement. Make sure that your hotel offers guests a smooth and cohesive online interaction.

Do your Research

There are a lot of different hotels out there. It will be extremely important that you do your research and become clear about exactly what it is that will work for you.

Don’t just jump into buying a hotel without having a really good idea of what is going to be required of you in order to make the business profitable. Try to speak as much as possible to the current owner of the hotel that you want to buy once you have one in your sights.

You should also get a clear idea of the books of the business. It’s important that you know why the business is going badly if it is so that you can come up with a clear plan of how you will change this when you take over. Get to grips with the occupancy rates and the inventory of the business. Make sure that you’re aware of how much money will need to be spent in order to get the hotel to the level that you will want it to be.

Things to Consider

Collaboration is key if you want to be able to offer your guests the best experience possible. There are many services that you can get through partnerships with other businesses. Look for companies that can offer you check-in and booking services or find companies with services that complement yours in order to make sure your guests will keep coming back.

The rise in peer-to-peer accommodation, such as Airbnb, has made the hotel industry more competitive, which might mean that the rate that you can charge for rooms may be limited if you want to keep being competitive. It may be worth considering making your hotel Boutique- a trend that has seen an increase in the last few years.

Some Boutique hotels focus on the full experience of the guest and partner up with coffee shops, galleries or clothing stores. These partnerships create a hook for the hotel that can attract guests as they look for an experience that is out of the ordinary.

There is no longer a clearly defined separation of work and life and people who are traveling are more often looking for somewhere to stay that provides functional spaces for those who will be looking to do a bit of work during their stay.

The occupancy rate of five-star hotels was the highest in the past two years with Johannesburg and Cape Town attracting a significant share of people staying in hotels in the country.

If you have done extensive research and created a clear business plan, you will be ready to begin looking for the perfect hotel to buy. Remember, however, not to get caught up in the excitement of embarking on this journey and consider carefully if this is a business that you will be able to turn into a success.

Anthea Taylor

About the author

Anthea Taylor is Content Producer at Dynamis and writes for all titles in the Dynamis stable including, and as well as other industry publications.

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