Tips on buying a motel in New Zealand

Buying a motel in New Zealand can be a rewarding investment, both personally and financially, total guest nights in short term accommodation is increasing nationally and all those guests have to stay somewhere.  According to Statistics New Zealand’s latest Accommodation Survey, international guest nights outnumbered national. Tip

Read: Coromandel Court Motel – NZ Herald Article 3 May 2008s on buying a motel in Coromandel

Buyers from all walks of life are drawn to the accommodation industry and in particular the notion of buying a motel.  Motivators such as looking for a complete change of lifestyle, improving their income and seeking new challenges are what compel many of these potential buyers. 

But what are the realities; once the rose tinted glasses have been removed do these new moteliers find their ambitions of lifestyle and income matching the day to day reality? 

Experienced moteliers, Gael and Raymond Austen of Coromandel Court Motel, have kindly consented to an interview to answer some of these questions.  Previous involvement in the corporate world, which included extensive travel both nationally and internationally, and with associated experiences of accommodation provided Gael and Raymond with a strong foundation with which to enter the industry.

They bought the Coromandel Court Motel during the winter of 2003 after undertaking meticulous research which encompassed many other motels situated throughout the country.  

“We believe the Coromandel Peninsula is the new found place in the North Island, to compliment this the motel offered the opportunity of building a good solid business with the prospect of expansion to grow the business” says Gael.

The Austens, like many people, purchased the motel for the lifestyle and income that it represented.  However, they rapidly found that while there was the income, there was very little lifestyle.  After the initial shake down period, they realized that changes had to be made to rectify this and to make the motel function more efficiently.  Committing to change typically involves an investment of both time and money, and at a cost of around $30,000 an extra commercial dryer, commercial washing machine and commercial dishwasher were installed.  

The investment was worth it – Gael and Raymond now achieve quicker and more professional results, and all importantly the lifestyle has followed suit.

Naturally, when taking over an existing business many purchasers set goals for themselves as to how they will ‘improve’ the existing operation.  In this, Gael and Raymond were no different, setting targets for themselves that included developing a first-class corporate clientele as well as increasing the international and repeat guest nights. 

“We have achieved this by attention to service and offering top level quality.  We have also upgraded our computer sites, and in the process become very computer savy – our goals have been achieved” Raymond explained.

Gael and Raymond AustenSuccess in the accommodation industry is based on how your guests perceive you – the provider.  Striving to meet (at the very least) or exceed the guests expectations will ensure that your motel will profit from strong repeat and referral business.  

Motel features such as spa pools, restaurants, and gyms are part of the guests’ experience, but keep in mind; your motel may have all the features in the world, but if the service isn’t friendly and the rooms aren’t clean your guests wont return.  Get the basics right and the rest will follow. 

An ongoing challenge for Gael and Raymond has been to ensure that all clientele leave the motel completely satisfied with all aspects of their stay, ensuring that they return and subsequently recommend the motel to friends.  I spoke directly to some of the guests to gauge opinion – remarks like “top hosts”, “hygiene the best”, “quiet”, and “best in all our travels in New Zealand” were freely given.  A quick glance through the comments in the Motel Visitor’s book certainly qualifies the validity of the Austen’s approach, with many genuinely, satisfied and happy and guests. 

The Austen’s feel that the continuing success of the Coromandel Court Motel is based on having a solid management team supported by very good staff including an experienced back-up manager.  Their motto, which all members of the team follow, is “Clients first, second and third”. 

“To be a successful motelier” Gael advises “prior experience in the hospitality industry is very helpful but not essential.  A professional approach and manner plus outgoing personalities are a must.  Prepare to go the extra mile at any time – with a smile” 

Raymond’s tip for newcomers is “Look for a solid business in a good area that offers the opportunity for potential growth” 

Having not only achieved but exceeded the targets set back in 2003, the Austens are now ready for their next challenge.  Under their stewardship the Coromandel Court Motel has developed into a shining example of what is possible and the motel now stands in the top arena based on turnover and occupancy for its size.  There is scope for an incoming purchaser to add their own mark as the entire freehold going concern known as the Coromandel Court Motel is being offered for sale contemporaneously with the neighboring freehold property, allowing room for further development. 

If you are considering buying a motel, take note of Gael and Raymond’s suggestions above.  Tips on buying a motel in Coromandel

Contact Sharon for more information. 

Related: Buying a NZ Motel Freehold Going Concern
Related:  Have you considered buying a Leasehold Motel or Hotel ?
Related: 1. Buying a Business
Related: 2. Selling a Business

April 15 2008 08:37 pm | The Professional Business Broker

3 Responses to “Tips on buying a motel in New Zealand”

  1. Denelle on 20 May 2008 at 1:16 am #

    Denelle…

    All I can say is WOW! Extremely nice layouts, awesome graphics and great articles. No matter how many times I come here, I am still impressed by the very professional appearance. Congratulations on a job well done….

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