manasra
2 Sep 2008
Law / Some questions about running a Hostel in Krakow [28]
Allow me to share with you few pionts worth taking into consideration and my opinion on the offer you got.
1- Generally speaking no one invests 100 % of her/his capital in any business endeavor especially real estate and hotels. Even the big players don't use their capital to purchase a premise sure not hotels. What's usually done is that you use your capital or portion of it as secured funds to be able to get a loan from a bank or invesment bank. The amount you get this way would allow you to purchase the premise. Then operating teh premise should genarte enough profit to allow you to pay back the bank while such repayment should not exceed 50% of your profit.
2- Many people would caution you not to get into this business. Maybe they are true but if you consider facts like Krakow being one of the most visited city in europe plus a host city for the Europe football Cup taking place in 2012 then having a hostel in teh city would pay itself off easy. There is a shortage of more than 600 1-3 stars Hotels in Poland.
3- I'm within the trasnport business and work closely with hotels and other accomodation providers. It's quite a challenge to find teh best location with reasonable price but if you manage to do it right such business is very worth doing.
4- Concerning the offer you've receieved. Indeed the price is for buying the owenership rights of the premise (hostel) with all commitments associated with it meaning the renting agreement. The current owner doesn't expect to get the full amount up front. Rather probably in installments. When he says things are negotiable, meaning that when you become the new owner you reserve the right to negotiate the leasing terms with the current renter. If you want the hostel for yourself. You may be able to get but you would have to compensate the current operator somehow.
Hope this helps and wishing you a best of luck in making your dreams come true.
Should you have further concerns feel free to write me at smanasra@gmail
Sam
Allow me to share with you few pionts worth taking into consideration and my opinion on the offer you got.
1- Generally speaking no one invests 100 % of her/his capital in any business endeavor especially real estate and hotels. Even the big players don't use their capital to purchase a premise sure not hotels. What's usually done is that you use your capital or portion of it as secured funds to be able to get a loan from a bank or invesment bank. The amount you get this way would allow you to purchase the premise. Then operating teh premise should genarte enough profit to allow you to pay back the bank while such repayment should not exceed 50% of your profit.
2- Many people would caution you not to get into this business. Maybe they are true but if you consider facts like Krakow being one of the most visited city in europe plus a host city for the Europe football Cup taking place in 2012 then having a hostel in teh city would pay itself off easy. There is a shortage of more than 600 1-3 stars Hotels in Poland.
3- I'm within the trasnport business and work closely with hotels and other accomodation providers. It's quite a challenge to find teh best location with reasonable price but if you manage to do it right such business is very worth doing.
4- Concerning the offer you've receieved. Indeed the price is for buying the owenership rights of the premise (hostel) with all commitments associated with it meaning the renting agreement. The current owner doesn't expect to get the full amount up front. Rather probably in installments. When he says things are negotiable, meaning that when you become the new owner you reserve the right to negotiate the leasing terms with the current renter. If you want the hostel for yourself. You may be able to get but you would have to compensate the current operator somehow.
Hope this helps and wishing you a best of luck in making your dreams come true.
Should you have further concerns feel free to write me at smanasra@gmail
Sam