B&B's with Lease/Purchase option?

[mona]

The only innkeepers I know who did this went bankrupt. They had several try the leasing...I assume they got a hefty down payment from them..but both of them had on "rose colored" glasses and neither lasted 2 months. One went bankrupt, the other--just left. I suspect she lost a good down payment as well. Then, the "Owners" themselves on some sort of visas, were unable to make their bills, time running out..so they just threw it to the wind and hightailed it out of the country leaving all their creditors behind. Bank has the property for sale now if you ever find some money.
Don't think you will find much around with this option. If you want to get into innkeeping take an aspiring class first and save some money. Sorry to say at 27 chances are slim to none if you don't have any income or support / health care etc from somewhere.
Take some time here and read through past threads. you will learn alot. Everyone here speaks the truth whether people like it or not but that is they way we are...take it from the voices of experience..

Your example is interesting- in that you've known of only one, who themselves up and left the property. I'd say that's not a typical situation and, generally, a terrible example.
If you want to get into innkeeping take an aspiring class first and save some money. Sorry to say at 27 chances are slim to none if you don't have any income or support / health care etc from somewhere.
While I appreciate your "advice", I find you patronizing. Just because I'm 27, doesn't mean I don't have savings.
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I may only know of one personally, but I have heard many many more stories. In fact we have a forum member here who recently lost her place.
Well you stated " a place to pay for itself" that makes me assume. Savings is a relative term. Our savings Paid cash for our B & B. If I sound patronizing it is because so many have come here asking questions and not liking the answers they get. We get tired of playing the game.
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Wanting to buy a business that breaks even is not abnormal and indicates nothing about my financial situation... Who would want to purchase something that is losing money?
If you are tired of newbies like myself, you certainly didn't have to reply to my post.
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Wanting to buy a business that breaks even is not abnormal and indicates nothing about my financial situation... Who would want to purchase something that is losing money?
If you are tired of newbies like myself, you certainly didn't have to reply to my post.

answers given to questions are not to be taken as a personal reflection - we have no idea who or what you are. I know some 27 year olds who are set financially and mentally and some who at 40 still are not. Your questions are not being answered at the personal YOU, they are answered at the question you asked.
I have a 3-guestroom B & B and there is no way I would consider leasing it. I built this baby from scratch and put a lot of work and sweat into building a great reputation - something that could get ruined in one month if handled wrong.
Call me snarky if you wish, but just what profession allows you to just come in and "try it on for size"? For most professions (and trust me, innkeeping is a profession) you have to go through schooling or an internship or some sort of training. The only job I know of that you just learn by doing is being a Mother - no handbook there damn it!!
So just cool your jets and start over nicely. These folks are trying to help you and you will only get backs up by being disrespectful to anyone here - because everyone here is actually (or has been) in the trenches with the toilet brush and knows what the heck they are talking about.
We do give second chances - so ask your questions and be prepared for honest answers/
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I didn't take anyone else's post as a personal reflection at all. I only took her comment personally because she used my age as part of the reasoning I wouldn't succeed- which is something I find patronizing. And no, I do not apologize for that.
There are different ways to answer questions, respond to people, give advice, etc. Many people gave me fantastic advice that I've absorbed and will give a lot of thought too. I appreciate and respect them for that.
I don't really feel a need or want of a second chance from you and I don't believe I said anything that requires me "start over nicely". But thanks for the offer...

 

[mona]

All I can say is YIKES. If you think it is risky to own it, it is even riskier leasing it out to someone who might run it into the ground and walk away. (Not you, this has happened to quite a few people). No skin in the game, is what I would call it.
The lease option may be out there for someone who had a death of a spouse or something major and needs to be out of the business immediately. I could see that being a viable option.
Hope you get many great answers here, mine being the first. All the best!.

Yeah, I definitely get what you are saying.... But if I'm paying an option fee- that's my skin in the game. If I walk away, it's the sellers to keep.
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Yeah, I definitely get what you are saying.... But if I'm paying an option fee- that's my skin in the game. If I walk away, it's the sellers to keep.

While you are correct that you do have something to loose, for the owners (sellers) it becomes a matter of 'WHAT' they get back if it doesn't work out. - This is NO reflection on you, not at all, this is a statement driven from those that have experienced the problem and have shared that experience. Of course there have also been win/win situations as well.
If a person leases a currently thriving (or even holding its own) business but does not take the care to keep the business in the current state, then walks away. What the owner gets back is not the same business. The name is tarnished and therefore harder to turn over again. And if the owner returns to the business, it is again a work in progress to return it to its once thriving self.
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That makes sense. I haven't considered the lease/purchase option through the seller's perspective. They do have far more at risk. It be far too much trust to put into a stranger.

 

[toddburme]

We have offered our B&B to the couple running it. So they have first right of refusal when it goes up for sale again. The good news is I am sharing monthly statements with them so they will know if this makes sense. Also they run 90% of the day to day so if I need to carry some owner financing, I know how they will do for the most part. The biggest fear points will have been removed before a purchase.
They had already worked at the B&B since it opened and just taken on more and more responsibilities. So it was not someone off the street. I am not sure how someone would create the comfort level with a stranger.
The ideal might be an employee arrangement combined with an option versus a lease/option. We have a lot of owner operators on this board and no doubt that is the model that our clients are expecting so it has its benefits.
I think that any model can work if both parties are interested in it. Just stay sensitive to the other parties wants/needs.

 

[birdwatcher]

Im late in answering any questions, but innkeeping is more of a lifestyle and its not a "quit if i dont like it profession" if you own or lease/rent the business you want it to pay for itself thats great, but the truth is that leasing/owning a business is a commitment not a "well i'll just try it till i cant pay the bills or to see if its a viable business for me"-this statement is so immature-and yes i see youre 27, but the truth is that unless a B&B is run so effectively in a great place that is busy consistently and has no overhead or anything pertaining to maintenance of the building, employees, the economy and lets not forget what the reason that this business is being sold or leased-if may pay for itself but without any profit how will you live? I mean you do need some income to have a life dont you or work towards retirement?
We owned and operated a beautiful B&B and lost everything because of the economy and it was seasonal. We decided to still be Innkeepers and are working now at another B & B-its not easy to work for someone else but then its what we really love to do, the burnout is high in the B & B business whether you own it or work in one. My suggestion to you would be to get hired in a B & B and be an innkeeper first-this will give you a clue in to the REAL job of being a cook, cleaner, laundry person, dishwasher, entertainer, secretary, reservationist, baker, gardner, shopper, bookkeeper, marketer, seller, community organizer, volunteer and best of all the personal side of your life...like someone above said Innkeeping IS NOT FOR WIMPS OR for the SOFT HEARTED. You are always ON-you carry the phone with you or forward that phone, you answer calls at all hours sometimes-you cant really be sick or get a day off-
This is the best and most honest forum you will ever be in, we are all professional Innkeepers and we will all tell each other the honest truth about everything, some of it is not so pretty trust me on this i've also been on the other side of it-but the truth sometimes hurts. All Im saying is be sure that is what you want to do , cause its not what you think it is you know what I mean. There are many semiars available out there-you may even decide that you want to volunteer in one for a couple weeks just to get the jist of this life we all have.

 

[Samster]

I've known of one individual who did a lease to purchase option that was successful, and that was structured where she bought the business part, and leased the property. It was a very high occupancy large inn and she was able to make enough to eventually purchase the property too. She had very little in personal assets when she embarked on the project. However, it was when the economy was really strong, too.
Another innkeeper successfully did a lease to purchase of an under performing inn, grew the business, and sold it for a big profit. (Again, larger inn in a very popular tourist area.)
From the seller side, I know of several folks that lease-to-purchase did not work out well for either the buyer or seller. In one instance, the buyer paid a premium for the innkeeper's residence as part of the deal and ended up selling it in a short sale. They had to back out of their lease-purchase agreement but still had the house. Another innkeeper had not vetted the individuals properly, and they raided the cash from the business (and deposits for future stays) and disappeared. I believe that the owners attempted some kind of legal action against them but don't know if it was successful.
These type of agreements have to be written carefully, to protect both sides. But, it's worth investigating. Sometimes an inn broker has much more experience with them.
Welcome and good luck.

 

[user 26]

hello ... welcome.
something scratching at the corner of my mind ... i'm thinking i just recently saw a post from someone on this forum looking to hire an innkeeper for a property he/she/they own and that they might have mentioned leasing. I'll have to do a search. maybe you could start out as the paid innkeeper and then if you love the place see if you can work out a deal.
i know someone who leased and now owns. i believe he took it over from a couple, one of the people was sick ... it started as a paid employee arrangement and then he took on more and more responsibility and it evolved from there.
good luck

 

[user 26]

here's one of the threads but it's old
https://www.innspiring.com/node/11544

 

[user 26]

found it! https://www.innspiring.com/node/12789

 

[gillumhouse]

Here are two Seminars by some inn brokers - Inn Partners
Do you have guests who are interested in becoming innkeepers? Please let them know about our upcoming seminars: June 1, 2013, 9:00am to 5:00pm at the Three Mountain Inn in Jamaica, Vermont and Saturday, September 14, 2013, 9:00am to 5:00pm at the Arrowhead Inn, Durham, North Carolina.
Aspiring innkeepers can register through our site or give us a call 877-957-2360 Seminar for Future Innkeepers!

 

[bbinnsitters]

Mona, if you are still looking and would be interested in a full time Innkeeping job (to find out if Innkeeping is for you) let me know and I can point you in that direction.

 

[mdinnc]

Mona, we'd be interested in talking to you about your dream of leasing a B&B ... our B&B. We're in North Carolina. So many negative comments here. Don't give up.

 

[Copperhead]

Mona, we'd be interested in talking to you about your dream of leasing a B&B ... our B&B. We're in North Carolina. So many negative comments here. Don't give up..

mdinnc, click on mona's name and then click contact to send a private message to her email through this forum. Sure hope it works out for the both of you!
Oh, and welcome to the forum! Hope you stick around!

 

[Jcuster66]

Mona, we'd be interested in talking to you about your dream of leasing a B&B ... our B&B. We're in North Carolina. So many negative comments here. Don't give up..

Very interested in a lease option of B&B in NC.
[email protected]
7043303144
Look forward to hearing from you.
James

 

[EmptyNest]

Mona, we'd be interested in talking to you about your dream of leasing a B&B ... our B&B. We're in North Carolina. So many negative comments here. Don't give up..

Very interested in a lease option of B&B in NC.
[email protected]
7043303144
Look forward to hearing from you.
James
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Sorry but if you read the post date, this is totally out of date

 

[Silverspoon]

Mona, we'd be interested in talking to you about your dream of leasing a B&B ... our B&B. We're in North Carolina. So many negative comments here. Don't give up..

Very interested in a lease option of B&B in NC.
[email protected]
7043303144
Look forward to hearing from you.
James
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I would remove your personal information from your post.