Hotel rental contracts are a passive investment in a hotel property. The hotel tenant benefits from the hotel`s management, including as a sub-letter of hotel rooms and other facilities and by providing other hotel services. The real estate investor can only expect a sustainable return if rents are market-based and maintained. This means that it is particularly important to analyze current rental prices and verify contracts where real estate is potentially too or not low-rented. The remuneration of hotel owners corresponds to a risk premium for the operation of the hotel and often corresponds to 6 to 12% of the total turnover of the hotel. The balance is available to the tenant to pay rental interest to the hotel/hotel investor. There are different advantages and disadvantages to the parties when executing a lease or HMA. b) – up to a month-to-month lease, until one of the parties terminates the contract by a written notification of at least 30 days for the premises to be evacuated. As we can see, there is a big difference between hotel management agreements and hotel rental agreements and there are advantages in both directions. A real estate owner`s commitment to a management company with proven management skills, a CURRICULUM VITA AND A target GROUP may be appropriate for a property owner with knowledge and experience in the hospitality industry, who would be interested in creating a professional hotel and increasing his chances of success. On the other hand, a landowner who would be interested in minimizing his risks and being interested in industrial tranquility, such as a management company that has all the risks and all the chances of success on its side, will prefer to enter into a hotel rental contract. In this article, we will briefly examine the main differences between signing an administrative agreement and participating in a lease agreement, and attempting to highlight the pros and cons of participating in each of these agreements. In summary, two options are open to the parties when they decide whether or not to operate a hotel.

You can execute either a lease or an HMA. Both have advantages and inconveniences. The search for the right operator or brand is one of the main components to ensure a viable and long-term hotel project. It can have a significant impact on the design, operation and financing of the project. It also affects the value of the asset. The hotel operator brings his know-how, knowledge, brand and network. In addition to the designation of the right operator, the terms of the contract and the choice of a contract will be essential, as it generally determines the relationship between the parties for decades and is difficult to change after its execution. There is no clear „winner“ as to whether a HMA or lease is the ideal solution, just as there is no better operator or single brand. It will depend above all on the specifics of each situation, each party and each project. Charles AMAR is an advisor at Sarin Associates in collaboration with DFDL. For more information, please contact him at: No 30, Preah Norodom Boulevard, 4th floor Bred Bank Building, Sangkat Phsar Thmey 3, Khan Daun Penh (PO Box 7), Phnom Penh, Kingdom of Cambodia, T: `855 23 210 400 | M: `855 68 68 66 02 | E: charles.amar@dfdl.com Tags: Business Leasebusiness Leasing TourismHotel Management Management Management Management-Arrangement Risks This last point opens up a source of synergies, but is also a catalyst to discuss the distinction between information and even the merging forces of the parties, and interference. This discussion has traditionally been linked to management agreements.

The first is the economic and financial crisis, which is no longer as current, as we experienced between 2007 and 2013. The sharp decline in hotel revenues, caused by this crisis, particularly in secondary destinations, has jeopardized the viability of a large number of rental contracts, many of them fixed income and, as a rule, between the late 1990s and the new J