Investing 280k in an upcoming hotel project?

Hello!

I am currently eyeing a 280k EUR hotel project in Alentejo area. The project was presented to me by a firm and the hotel brand is big and reputable (not sure if it equates to reliability). But there seem to be so few discussions around the 280k options? Has anyone chosen this path, and if so, what are your results so far?

For professionals: what could be some of the potential risks that we need to aware of? Of course the firm presents the project as ultra-reliable, but as a potential investor I am aware that there could be a lot more to the story once the process unfolds…

Thanks in advance!!!

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Hi!
For hotel projects you need to carefully check all financials and the condition of the building (when the capital renovations were done/ when are expected), which RevPar does the hotel have, which amount of debts/ creditors.
Without careful check of this information in such a low-margin business as the hotel industry, you could step up into high-risky investment without any RoI.

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thank you!!! I am indeed wary of investing in hotels, especially with Covid, I doubt that renovations will be done in time or if at all…

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Yes, that’s true. Now it is even more risky than before COVID. But for the hotel investment this is one of a very important points. Otherwise, the room price is dropping down or/and the maintenance costs are coming far beyond expectations…

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Some of these hotel projects offering 7% guaranteed returns seem to good to be true. What would be a good investment these days? I am wondering if short-term rental apartments in Lisbon and Porto are still be the best for a 280/350K GV.

If it were me I wouldn’t even consider this unless I either understood the legal environment regarding real estate ownership there, or had a very solid attorney advising me.