Updated October 2026 · Fraser Bond
Hospitality · Investment
Buying a 5-star hotel
EBITDAvaluation
Brand& management
CapexPIP
Calculatorvalue
In short: Luxury hotels are usually valued on their trading profit (EBITDA) and a yield or multiple, not just bricks and mortar. Key questions are whether you'll own and operate, use a management agreement with a hotel brand, or a franchise; how much capital spending (capex) the brand requires; and how revenue per available room (RevPAR) compares with competitors. Due diligence covers accounts, staffing, licences, condition and contracts. Fraser Bond can help investors with London hospitality and mixed-use property.
| Term | Meaning |
|---|---|
| ADR | Average daily rate |
| Occupancy | Rooms sold ÷ available |
| RevPAR | ADR × occupancy |
| PIP | Property improvement plan |
Key metrics
EBITDA valuation
Value before capex–
Adjusted value–
Simplified; professional valuations consider trading potential.
Frequently asked questions
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Browse every guide in Buying and Selling in London Hub → · London area guides →
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How are hotels valued?
On trading profit and yield.
Can Fraser Bond help?
With London hospitality and mixed-use property.
Investing in hospitality?
Talk to our team or get a free valuation.
Speak to our teamGet a free valuation
