Legal Advice on Buying or Selling a Hotel

Financial planning is key for hotel buyers, who will need both a solicitor and an accountant with experience of these types of transactions to ensure the business makes financial sense going forward. Apart from the price of purchasing the business, a hotel buyer needs to factor in staff wages, utility bills and supplies (particularly food and drink).

VAT issues concerning the transaction will also need to be carefully evaluated. Often the hotel buyer will be intending to live on the premises, and may accordingly wish to sell their current home. A solicitor will be able to help coordinate the sale of a home with a hotel purchase, making the transaction as smooth and seamless as possible.

Even if the hotel being purchased is already up and running, the buyer may need to apply for and obtain various licenses and permissions before completing the transaction, including planning permission for any intended refurbishment work, and licenses, for example, to serve alcohol, provide live entertainment, or offer on-premises beauty and wellness services. If the hotel is new, the buyer is likely to need planning consent for change of use and a licence for a house in multiple occupation (HMO), as well as the various other licenses necessary to operate the business successfully.

A hotel buyer’s solicitor will need to raise a number of enquiries and carry out various searches on both the business and property, including checking the compliance with planning conditions of any recent refurbishment work carried out. Licenses to serve food and alcohol will need to be examined, as will ventilation, disabled access and outdoor seating arrangements. Water, drainage, environmental factors and local authority development plans will also need to be considered.

A solicitor will also be able to handle matters connected with employment law, the most important of which will be the contractual status of any current staff. Usually, the hotel manager and key staff will be provided with accommodation at the hotel under the terms of their employment, and a number of important details will need to be covered in their occupancy agreement such as rental payments and access rights. Buyers of up and running hotels will also need to make sure that all IT equipment, software, websites and social media accounts are transferred from the seller and ready to go from day one.

We have solicitors specialising in hotel purchases and sales, with many years of combined experience in handling these transactions. We offer a nationwide service and highly competitive fixed fee legal services. Bartletts Solicitors is a law firm that you can trust, established since 1860, with the expertise and experience to handle your hotel acquisition and help you achieve your aims.

There's no two ways around it: running a bed and breakfast is hard work. It’s all day long 7 days a week. And at the end of the day, there’s no home to go to because you’re already there! Still, for those who love the lifestyle there’s money to be made by keeping those beds full. A well-run B&B can easily take £120,000 or more per annum.

Before launching into the business you need to sit yourself down and plan things very carefully, especially the finances. On top of the large initial capital investment, it is expensive to keep a B&B in business. For example, you’ll have to find the money to pay staff, huge utility bills, and all those daily full English breakfasts. You’ll need to work closely with an accountant who’s familiar with the area, to make sure the budget stays afloat. You will also need a solicitor to advise on the purchase or sale of your bed and breakfast business.

If you’ve found a B&B you want to buy or sell then you’re probably feeling quite impatient to get started. Unfortunately, you really do need to take the time to get some advice from a solicitor. You’re risking too much by simply signing on the dotted line. The good news is we’ll make the process quick and painless. Because we are solicitors who are expert at buying and selling bed and breakfasts, we will stick to the essentials.

Good legal advice on the law relating to bed and breakfasts will save you time and money. To give you a flavour of the challenges, here are some typical important issues that always need to be considered:

B&B buyers often need to sell their home to raise the funds to buy the B&B. If the idea is to live in the B&B then this usually makes sense. We know how to synchronise the sale of your house and the purchase of the B&B so it all goes smoothly and quickly.

Unless you’re buying a fully functional B&B, the chances are that you will need to apply for and secure various permissions and licences before you complete the purchase. We’ll make sure that these are secured as a condition of purchasing the building. Otherwise you may find you’ve parted with your hard earned money for a building you can’t use as a B&B.

Due to the nature of the job, it’s common to offer some staff accommodation as part of the terms of their employment. If so, you’ll need an occupancy agreement that carefully details important matters such as what parts of the property they can use and stay in, rental payments, termination of the agreement, etc.

IT plays an increasingly important role in marketing, securing reservations and generally running the B&B. If you’re buying an existing B&B we’ll make sure that all the relevant IT equipment, website content, hosting addresses, software, etc. is correctly transferred to you. So, from day one, you’ll be able to use and develop IT with no hiccups.

Our client was set to purchase a 6 bedroom B&B. Days before we were expecting to exchange contracts, our enquiries revealed that there were significant breaches of planning conditions relating to the refurbishment works the seller had carried out. In the end, we managed to secure a discount of £30,000 from the purchase to compensate for the additional works that would be needed post completion to comply with the planning conditions.

Another client didn’t realise that one of the rooms in the house that he had intended to put paying guests in was still occupied by a member of staff, who claimed she had a secure tenancy agreement and had every right to stay there. We insisted that the seller sort the problem out. In the end the seller paid the difficult former member of staff to leave early.