Resorting to Less

If you travel a bit, you’re likely familiar with an annoying trend at full service hotels, and even at some limited service hotels. You are quoted a rate online or over the phone, and you check in, assuming you will pay that quoted rate plus a healthy local lodging and sales tax.

But in the past few years, a number of seemingly mundane brands & properties have added the “resort fee” concept to hotel billing. These fees commonly range from the high teens to just under $40, and purport to cover extra amenities to enhance your travel experience. A fee all too often disclosed only at checkout.

For the assessment professional, the question is whether to recognize these fees in income-based real property valuation. Are the resort-related services and amenities part of the the real estate, or do they arise from the business enterprise?

The answer is usually unclear. If you take the time to research what elements are included in these fees, often you’ll find the pool and fitness areas are mentioned, along with some inscrutable references to concierge-like services.

While I usually counsel conservatism in lodging income analysis, these fees strike me as fair game for inclusion for real property valuation purposes, until they are clarified. Ask questions, require answers… don’t resort to less than full disclosure.

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