Buying a hotel or a pub is a significant investment. As such, it is important to get advice from professionals before signing any sale agreement. The best person to help you during this process is a hotel broker. Such an individual has experience in the sale of similar businesses, and they know what to evaluate when they are assessing various deals. Below are several details that you should request from your hotel broker.
The insurance status of the facility
Always ask for details relating to the insurance status of the facility. Is the business insured? What is covered in the insurance? How long is the insurance still valid? These are some of the questions that you should ask the hotel broker. In some cases, insurance becomes invalid when there is a transfer of ownership. Make sure you clarify all these factors to prevent any inconveniences once you have purchased the business.
Any hidden issues relating to the facility
Apart from the legal documents relating to the business, you should ask the hotel broker to find out any issues relating to the facility. Some of these issues include whether there are any complications regarding ownership or inheritance of the property. It is easy to ignore such details, but they can affect the daily operations of the business. As the prospective buyer, you can also hold talks with several current employees at the facility. Such measures safeguard you from purchasing a declining business that does not guarantee any returns.
Terms of the sale
You should know all the terms and conditions of the sale. Some of the essential details include whether the business will be sold as a going concern or whether you will have to recruit new employees and sign new contracts with suppliers. Ideally, the business should be sold as a going concern, where only the ownership is transferred. In this way, the new owner will benefit from the goodwill created by the current business and its employees. Buying such a pub or hotel is better than purchasing one where you have to start recruiting employees all over again.
Never complete any purchase transaction without involving a lawyer. Even when the price seems to be attractive, take time to consult with property lawyers and hotel brokers to conduct due diligence. Based on their experience, they can easily inform you which deal is good and will guarantee you sufficient returns in the future.