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Hotel Valuations in the Sunshine State: What the Tax Man Misses
Florida’s hospitality market is as dynamic as its coastline. But with revenue per available room (RevPAR) shifting by season based around Florida’s tourism trends and labor costs rising fast that drag down a property’s net operating income, many hotels are struggling to maintain consistent profitability.
That doesn’t always stop appraisers from issuing sky-high valuations.
Key Issues with Hotel Tax Assessments
- Using gross revenue instead of net operating performance, disregarding the expenses a hotel faces
- Ignoring franchise fees, management costs, and PIPs
- Misapplying market-wide averages to unique boutique or flagged assets
- Including business value in the property assessment
Revenue ? Value
A strong ADR in high season doesn’t justify a full-year valuation spike—especially when:
- Off-season demand plummets
- Labor and other costs increase dramatically
- Major capital improvements are on the horizon
What We Do for Hotel Owners
FirstPointe Advisors prepares specialized income models for hotel assets, accounting for:
- STR report data and a full year of data (historical and projected)
- Branded vs. independent operating differences
- Proper consideration of capital reserve requirements
- Proper examination and removal of intangible value from the real estate valuation
You know your keys better than the county does. Let’s make sure your property taxes reflect that.
Contact us for today for help on your property tax needs!
954.546.9630
6301 NW 5th Way
Suite 2800
Fort Lauderdale,
FL 33309
