Buying and Selling Hotel and Motel Businesses

Hotels and motels combine operating businesses with significant real-estate, franchise, and regulatory components. Buying or selling them requires careful attention to brand standards, property conditions, financing, and the experience of management. DiTommaso Lubin, P.C.’s Business Purchases & Sales Practice Group represents buyers and sellers in hotel and motel transactions ranging from single properties to multi-location portfolios.

Our attorneys draw on decades of experience handling complex business purchases and sales, including hospitality deals involving multi-million-dollar properties and operations.

Helping Buyers of Hotel and Motel Businesses

When we represent buyers of hotels and motels, we typically:

• Advise on deal structure, including asset purchases, equity purchases, and combined real-estate and operating-company acquisitions.
• Coordinate due diligence on financial performance (occupancy, ADR, RevPAR), franchise or brand agreements, management contracts, vendor contracts, and booking-channel relationships.
• Review property-related issues, including title, surveys, zoning, environmental matters, and property-condition reports, as well as any required property-improvement plans (PIPs) mandated by the brand or franchisor.
• Analyze employment and staffing issues, including union and collective-bargaining agreements, benefits, and wage-and-hour practices.
• Negotiate purchase and sale agreements, franchise-transfer agreements, management-agreement assignments or terminations, and related documents.
• Address financing structures, including senior and mezzanine debt, and related security interests, guarantees, and covenants.

Helping Sellers of Hotel and Motel Businesses

For hotel and motel sellers, we focus on:

• Preparing properties and operations for sale, including reviewing financials, brand-compliance status, and key contracts likely to be scrutinized in due diligence.
• Structuring deals to appropriately allocate risk through representations and warranties, indemnities, escrows, and holdbacks, while managing post-closing exposure.
• Negotiating letters of intent and definitive purchase agreements, with attention to closing conditions, required consents, and termination rights.
• Coordinating with franchisors, management companies, and lenders to obtain necessary approvals and releases.
• Managing closing logistics, including prorations, working-capital adjustments, and transition of management and employees.

Disputes Arising from Hotel and Motel Transactions

We also represent buyers and sellers in litigation and post-closing disputes involving hotel and motel transactions, including:

• Fraud in the inducement claims based on allegedly inflated occupancy or revenue figures, undisclosed capital-expenditure needs, or concealed brand-compliance issues.
• Claims that sellers breached representations and warranties in purchase agreements, franchise-related disclosures, or disclosure schedules.
• Disputes over earn-outs, performance-based payments, or post-closing adjustments tied to revenue or profitability.
• Conflicts over non-competition and non-solicitation agreements, management-transition obligations, or misuse of confidential information after closing.

Our litigation experience informs our transactional work, and our understanding of how disputes arise helps us draft agreements designed to reduce the risk of future litigation.

Talk With Our Hotel & Motel Transactions Team

If you are considering buying or selling a hotel or motel business, or are involved in a dispute arising from a hotel or motel transaction, our Business Purchases & Sales Practice Group can help you evaluate your options and protect your investment.

Contact attorney Peter S. Lubin or attorney James V. DiTommaso for a free consultation.

Call 630-333-0333 or reach us through our online contact form.

This page is for informational purposes only and does not constitute legal advice. Contacting us does not create an attorney–client relationship. Past results do not guarantee a similar outcome.