Real estate crowdfunding is on the rise, with platforms like Fundrise and Crowdstreet streamlining the process of commercial traditional real estate investment and property ownership through crowdfunding.
HotelierCo, an Atlanta-based startup is now utilizing Regulation A+ digital crowdfunding to open up affordable hotel ownership to the crowd. These investments were only available to institutional investors in the past, making it a compelling opportunity for frequent travelers and savvy investors alike.
This begs the question: is hotel real estate a good investment? Let’s unpack this offering and find out.
HotelierCo Allows Everyday Investors to Buy Into Hotels
Not everyone can afford to own a hotel. Today, Hotelierco and Regulation A+ allow non-accredited investors to get skin in the game. The start-up began accepting investors in August 2019.
According to Atlanta, Georgia resident and HotelierCo CEO, Nathan Kivi, each investment will vary. The first offering available is an equity ownership in a hotel development. Focusing on boutique, lifestyle hotels, HotelierCo is now accepting investments from the public for its first property, The Ewing Hotel in West Cape May, NJ.
The initial rooms are scheduled to open in 2020 with the full development open in 2021 under hotel management of Valor Hospitality Partners.
Interested? Here’s everything you need to know about hotel real estate crowdfunding with HotelierCo.
Reasons to Invest in Hotel Real Estate with Equity Crowdfunding
1. Invest in a rapidly-growing sector
A recent study by Deloitte.com indicates travel and tourism is one of the world’s fastest-growing sectors, with close to $1.6 trillion in bookings and $62.5 billion total global hotel transaction volumes, respectively, in 2017. In addition, according to Smart Brief , a record $170 billion in gross U.S. hotel bookings is forecasted for 2018.
2. Qualified investments for first-time investors
Crowdfunding platforms like HotelierCo require SEC to qualify the offerings. Opening up investments to the public for the first time, this format ensures first-time investors are properly informed of potential risk. Regulation A+ also protects this new breed of angel investors, allowing them to invest only up to 10% of their annual salary or net worth.
3. Work in a market priced daily
Simply put, the investment opportunity blends real estate with business. CEO Nathan Kivi says this is caused by rates shift in real time with the market, allowing hoteliers to work at a faster pace than other real estate properties.
4. Fund your ideal boutique hotel experience
Hotel owners will ultimately be customers. Kivi says each raise will “focus on investors that are likely to be guests at the property.” In Cape May, Kivi says tourism is driven by visitors from Manhattan, Philadelphia, and Washington D.C. “The development at West Cape May will focus on finding investors in the main demand markets,” he said.
5. The future of hotel real estate and millennials
Digital convenience is important to millennials–even when it comes to choosing hotels. From virtual vacations, to technology-based tourism incentives, the hospitality sector is making strides to attract millennial stayers.
Currently, eTravel generates nearly $1.2 million in revenue. This number is expected to continue to grow each year.
6. Broad portfolio diversification
In an article by Hotel Business, Kivi explains how investors can diversify real estate investments with hotels:
“Investors will have access to an asset class that would otherwise be unachievable for such small investment increments,” he said, “This will allow investors to diversify their investment portfolio across markets.”
7. Ditch the timeshare, keep the perks
Hotel ownership is different from vacation rentals and timeshares. Timeshare involves buying blocks of time for guaranteed vacation, whereas hotel ownership provides investors returns based on the entire hotels performance.
That’s not to say hotel ownership doesn’t come with perks. Kivi says HotelierCo members will also be able to utilize their investment to receive an owner’s discount on lodging. He describes the discount as “a direct pass-through of what an online travel agent would be otherwise taking as a fee.”
8. Hotel ownership, without the hassle
Owning and operating a real estate property is a detailed process. Whether you’re investing in apartments or hotels, there is always work to be done. Flipping houses, revamping historic mansions and building boutique hotels requires time — something many investors do not have.
Equity crowdfunding platforms like HotelierCo offer real estate ownership without the hassle of owning or operating a business. Investors can receive all the perks associated with their investment, minus any operational or landlord duties.
9. Equity versus equality
HotelierCo creates a new basis for hotel ownership. The unique equity crowdfunding platform was founded one goal: to allow anyone suitable to invest in luxury boutique hotels–not just wealthy, accredited investors.
Kivi says, “This will ultimately democratize current hotel ownership.” With the HotelierCo digital platform, hotel real estate investments also promote equal opportunity for everyone to access this profitable sector, regardless of social status.
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HotelierCo Membership is free and there’s no obligation invest.
What you’ll get:
● Explore current offerings
● Free webinars about hotel real estate
● Updates about upcoming and existing properties.
Sign-Up today to learn more.