The Hotel Investor Playbook

Sarah Dusek had built Under Canvas when a private equity buyer took a majority stake at a valuation north of $100 million. Michael Russell opens the episode by asking what they were actually buying. Her answer is two words: embedded EBITDA.

In this episode, Sarah explains how Under Canvas came to own both the real estate and the operating company as a single business with almost no bricks and mortar, and why that structure is unusual in hospitality. Michael presses her on whether glamping is destined to commoditize, given how little it takes to put tents on a field, and she argues the barrier to entry is lower than a comparable hotel while the operating complexity is about a hundred times harder. He also gets her to break down the economics of the conservation lodge business she runs at Few and Far, where a single project runs $20 million to $50 million, and she says she is underwriting to a 20 percent cash-on-cash target.

There is also the night a thunderstorm flattened her camp in Yellowstone while she was living on site with two small children, and what her team managed to do before eleven o'clock that same evening. She is candid about the credit card debt and the bankruptcy she was staring down at the time, and she gives a straight tactical answer on what to do on the days you want to quit. If you are trying to build something in hospitality that does not have a comp yet, and you want to hear what that actually costs, this is that conversation.

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Bruce and Emily Haupt run The Landgrove, a 16-room inn with a full-service restaurant and a 1,500-square-foot art barn, in a Vermont town of 180 people. They paid $1.8 million for it, and the down payment did not come out of savings. It came out of Emily's 401(k), rolled into the business through a provision in the tax code called ROBS, Rollover for Business Startups, which let them put $450,000 of retirement money to work without paying an early withdrawal penalty. The catch is that she had to quit a 16-year career at Shell before the money could move at all.

In this episode, Michael Russell walks through the capital stack piece by piece, all four layers of it: bank financing, development authority financing, the ROBS rollover, and a seller note. They get into what ROBS actually costs to set up and maintain, why it forces you into a C corporation, and why most of their business is owned by the 401(k) rather than by the two of them. They also cover what the spreadsheet missed, including a renovation Bruce says ran about four times what they planned for, and a staffing constraint that has both the Haupts and Michael housing their own employees.

If you have retirement money sitting in the market and a hospitality deal you cannot work out how to fund, this one is worth your time.

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Adam Walz and Micah Thomas are the co-founders of Comeback Hospitality, and they are roughly 30 days from opening The Wesley, a 1960s roadside motel in Page, Arizona they are converting into a 50-room boutique hotel. To buy it, they called 62 banks and got 61 no's. The 62nd said yes. As Micah puts it, financing a negative cash-flowing, unflagged hotel in a tertiary market is not something most lenders want anything to do with.

In this episode, Michael Russell walks them through how the deal actually came together. A property listed at $6 million stepped down to $3.3 million all cash, putting them in at roughly $67,000 a key against a market average Micah puts at $115,000. The capital stack: $4.7 million financed against about $6.7 million all in, $1.65 million raised from investors, $250,000 of their own money, roughly 80% loan-to-cost, and why they took the SBA 7(a) over the cheaper 504. They also get into what went sideways, including a $10,000 WiFi upgrade that became $50,000 before another $30,000 on top, and the largest investor walking away at the eleventh hour of a 90-day raise.

Micah also talks openly about living in room seven for the better half of six months while construction happened around him, and gives a straight answer on whether he would do it again. If you are underwriting your first commercial hospitality deal and you want to hear what the spreadsheet does not tell you, from two people who are still in the middle of it, this is that conversation.

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Dustin Baker runs Hidden Gem Media, a performance marketing agency built to pull hospitality brands off the OTAs and onto direct bookings. By his account, one client resort went from roughly thirty thousand dollars a month in direct bookings to somewhere between two and three hundred thousand. His explanation for that jump has almost nothing to do with follower count.

In this episode, Michael Russell and Dustin work through the difference between search traffic and discovery traffic, and why a business built on OTA and Google demand runs into a hard ceiling it cannot spend its way past. Dustin lays out the economics: what an effective commission actually includes once you add agency fees, ad spend, and any offer layered on top, and how that number compares to the 15 to 20 percent an OTA takes. He gives real thresholds: roughly five thousand a month in ad budget against fifty thousand in monthly room revenue, and ten thousand against a hundred thousand, and he is direct about the properties this does not work for. Michael's own hostel is one of them, and Dustin explains on air why he turned that business down. They also get into why calendar availability, not audience size, is what eventually drives ad costs up, why Dustin would hand an influencer's budget to Meta ten times out of ten, and why he would steer most owners away from crowdfunding a resort through pre-sold stay packages.

If you are running an experiential property and you have been meaning to get serious about direct bookings, this one gives you numbers to work from.

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Carly Whitney is a Senior Vice President at Business Finance Capital, a certified development company, and in thirteen years there she has been across more than a thousand SBA transactions. By her own count, that adds up to roughly four billion dollars in sales and refinances, with just over a billion of it in SBA dollars. Her answer to how much a hotel buyer actually has to bring to the table is fifteen percent.

In this episode, Michael Russell and Carly break down the SBA 504 program from the ground up. Why a hotel counts as a special purpose property and shifts the standard 50-40-10 structure to 50-35-15. How one loan can cover the purchase and the property improvement plan together, financing up to 85% of total project cost. What the long-term fixed rate looked like at the time of recording, how the 504's ten-year prepayment penalty stacks up against the 7A's three-year, and where the 51% owner-occupancy rule actually bites. They also get into the 20% ownership threshold that triggers a personal guarantee and what that means for anyone raising capital, the $5 million SBA cap and how green improvements stack around it, the new citizenship rule that can disqualify an owner holding as little as 1%, and why a seller's tax returns are the hardest document to pry loose on a hotel deal.

If you are looking at your first hotel and the down payment is the thing standing in the way, this is the financing conversation to start with.

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A 33-key Art Deco hotel in Miami sat on the market for five years. Forty brokers tried to sell it and failed. Amiti Bhow, Vice President at NewGen Advisory, finally got it done, not because she found a higher price, but because she found a buyer with certainty and clean terms.

In this episode, Michael Russell talks with Bhow about what actually closed the Marlin, a hotel with a recording history that includes Beyoncé, Pharrell, and Bob Marley, and why the ownership group she calls "hobbyists, not hoteliers" left real money on the table in OTA spend and revenue management. They get into the barbell shape of today's hotel market, where capital is chasing ultra-boutique experiences on one end and practical extended stay on the other, and what that leaves for hotels stuck in the middle. Bhow also walks through adaptive reuse, converting aging hotels into student housing, behavioral health facilities, or senior care as the baby boomer generation retires, and the underwriting checklist she uses beyond the spreadsheet: demand generators, incoming supply within a two-mile radius, and PIP cycles.

If you're evaluating a hotel deal, or wondering whether your property fits where the market is heading, this episode lays out the intangibles that actually separate a deal that closes from one that sits for five years.

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Alexander Cartwright is a PhD economist who left a tenured professorship to buy distressed hotels and convert them into workforce housing through his company, HotelSHIFT. His business rests on a simple valuation gap: hotels trade at higher cap rates than apartments because their income is considered less durable, so the same building can be worth dramatically more once it's rezoned and leased as multifamily instead of run as a hotel.

If you're looking for a corner of hospitality investing with less competition than traditional multifamily, and want to understand the zoning, financing, and tax mechanics behind turning a hotel into housing, this episode lays out the real playbook.  

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Dan Daly runs a fund that invests in boutique hotels across Europe, and on this episode he makes the case for why, in his view, Portugal beats the US on nearly every number that matters. According to Dan, property there has appreciated roughly 18% year over year versus 1.8% in the US, and a 30-year mortgage runs about 3.5% against 6.5-7% here. That gap, plus a much lower cost per square foot, is why his fund stopped looking at US deals altogether.

Instead of buying property, Global Investment Partnership invests in the operating companies that run boutique hotels in Portugal, hotels that are already refurbished, licensed, and cash-flowing but undermanaged. Dan walks through the specific leaks he looks for (unclaimed cleaning fees alone can run $25-35 a night per unit) and the five-year path the fund creates to permanent EU residency for investors and their families.

We also get into managing a portfolio spread across the US, Portugal, Madeira, and Andorra from a laptop in Los Angeles, and where Dan sees his exit.

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Neil Dipaola bought five wrecked Airstreams off Craigslist in 2012 to use as affordable housing in a Santa Barbara mobile home park. Today those trailers have grown into AutoCamp, a nine-property outdoor hospitality brand backed by Airstream, partnered with Hilton, and targeting 100 properties and 10,000 rooms within a decade.

In this episode, Neil explains how AutoCamp raised close to $300 million to build out its real estate portfolio, why he structured the business as three separate companies (real estate, brand, and operations) instead of one, and how that decision now gives him multiple ways to grow or eventually sell the brand. We also get into how the Hilton partnership actually works, why the AutoCamp team rejects the word "glamping," and how everyday investors can now buy equity in the brand for as little as $1,000.

If you're building a hospitality brand and thinking about how to structure it for growth or an eventual exit, this is the playbook.

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Chris Kilcullen has spent three decades in hotels, closing more than $500 million in deals as a senior broker at Avison Young. He's also sold franchises, brokered acquisitions for a REIT, and now built his own hotel concept, so he's seen the flag question from every angle. In this episode, he and Michael dig into the real math: why a commodity economy hotel can lose 30 to 40 percent of its value the moment it drops its brand, and why a well-positioned independent or boutique property can out-earn a branded one because it isn't capped by what guests expect to pay for a templated room. They also cover how Hilton and Marriott are using new soft brands to pull independent hotels back into their loyalty ecosystems, the F&B concept Chris is building to fix the one thing every guest complains about, and why some aging economy hotels are worth more converted into workforce housing than they are as hotels.

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