Occupancy rates

[AppraiserJohn]

Hello,
I'm new to the forum and wanted to introduce myself with a question. I'm a commercial real estate appraiser in New Hampshire and have a job appraising a B&B. The Subject has been poorly run in prior years and is now closed down with new buyers coming in. The buyers plan improvements and updates and want to be up and running by winter. I need to calculate it's Effective Gross Income and Net Income. Does anyone have any room occupancy rates for the New England area? Does anyone have a typical expense to gross income ratio? I need to calculate typical expenses as well.
Thanks for any help!
John

 

[EmptyNest]

CONTACT PAII they keep stats

 

[Morticia]

Contact the state tax office and tourism offices. They can probably give you pretty exact percentages for the area the property is in. By month so your buyers can prep for the slower seasons.

 

[Copperhead]

You could also contact the tax assessors office to see if they can provide ave tax income for various B&B's in the area...
Another option is the state B&B association.
And I beg of you do not do what what an appraiser did here! Do not call open B&B's to ask them for their information. i was shocked and outraged, and then asked him to please give me his income information for the past 3 years as he wanted from me.

 

[MtnKeeper]

You can't really go by the occupancy rate for a B&B because we're all different. We might have the same occupancy rate but our ADRs are different and our expenses are different (huge in NH are the differences in real estate taxes from town to town.) I'm in your subject area and I have kids. So I close all winter Sunday-Thursday to attend their basketball games and I'm only open weekends. This greatly affects my occupancy rate on paper. However, in the ski areas the B&Bs don't really get any business midweek anyway. If you're subject property is in NH's ski areas you can pretty much discount midweek business unless it's drastically discounted to get guests. Your new owners should know this because we were lead astray by many that the winter business is great all winter - nope, really just weekends. But we're very successful as I'm full every weekend all winter, all week winter holidays and all summer/foliage and my rooms are high end. Do all rooms have their own bath - this pretty much is a must now and if everyone of my rooms could have a jacuzzi tub I'd be golden. Guests expect a lot more nowadays than what the previous B&B may have had.
Expenses vary GREATLY one property to the next. Are the owners going to run it themselves or need help? And are they handy? If they are going to have employees then they need to factor in that labor cost to expenses? What about repairs? My hubby is a contractor and he does everything to this place and we do all landscaping and maintenance. Will the owners you're working for need to hire out all of this? In our case, if someone had to pay for weekly (sometimes 2x a week) lawnmowing and snowplowing they'd have much higher expenses than we would. Don't forget to factor in the food costs (and way overestimate) as costs just keep rising.
Huge expense to get a B&B back up and running (especially if had been run poorly - I hope they're changing the name) is what they will have to spend on marketing and the commissions they have to give away to the OTAs - this can take a big chuck of the income away immediately. The first couple years may be rough establishing themselves.
Good luck, valuing a non-running B&B with bad past history - its gonna be tough. And most of us won't share our real info with you as it's our proprietary work-product/financial information. Some may not even share as much as I did.

 

[JBloggs]

Contact one of the B&B brokers they may be able to help you, for a fee. Google that term, there are a couple of them up in New England that have all of it. Of course you may be cutting into their business, or perhaps they will hire you to use IN their business.