How has your buy-to-let portfolio been performing?
If you are like other buy-to-let landlords, you probably only be achieving a net yield of around 6% according to the Association of Rental Letting Agents.
Funds under management have not been performing much better with an average return of 4.6% for income ISA’s and only 3% on cash savings ISAs.
Investors are seeking opportunities for high yield investment with minimized risks.
Lack of earnings on managed pension plans are making every day investors give some attention to commercial property investments.
Managing director of One Touch Property, Arran Kerkvliet says that “We are finding that our typical investors between the ages of 55 and 65 are looking for complete hands off investments that are generating a high rate of income”
The average return of hotel room investments is between 8% and 12.5%.
There are a
lso tax advantages for those that choose to invest in a hotel room. Hotels are commercial property investments and can as such be included in ones Self Invested Pension Plan.
Existing funds that are already within a pension pot but have not been performing for can be used to acquire hotel room investments.
The entry-level prices for a hotel room can be as little as £17,000 with a fractional purchase, up to £90,000 when one purchases an entire room.
The purchase price is calculated by dividing the valuation of the hotel by the number of rooms. Hotel Rooms are typically sold with 999 year on the leasehold title.
Major Hotel Brands like Holiday Inn, Marriott and Ramada do not actually own the hotels anymore – pension funds and insurance companies do.
One can now invest in a hotel room and have the hotel management company enter into a 10-year lease to fully manage the property the property on your behalf. The luxury conference Hotelier Chateauform, in partnership with White Linen Hotel Management will guarantee a net income of 10% per annual for a period of 10 years.
The typical holding periods range between 3 and 5 years with clear exit strategy provided by a guaranteed buy back.
Châteauform are a 58 million Euro turnover company with an extensive list of blue chip clients that frequently require conferencing venues located near major cities across Europe. They already successfully manage thirty hotels located in France, Germany, Italy, Spain, Switzerland and Belgium.
One can invest in a hotel room within 35 minutes commute from Kings Cross St Pancreas International Rail. This will be the second hotel in England; with a five-year strategic plan to have six hotels under management - dotted around the M25.
London remains the most popular destination for tourism. The MasterCard Survey ranks London as the Top Global City for Tourism with 16.9 million visitors in 2012.