Fundamento

The Hotel Owner's & Operator's Manual

First Edition · 213 pages · 30 chapters · 6 appendices

Every figure in this book computes through one Python engine, independently re-derived by a separate verifier — 84 of 84 checks passing. Parts I and II — the seven chapters that answer "should I own one at all" — are free to read below and downloadable as a 51-page excerpt from the buy-a-hotel path. The full 30-chapter edition, all six appendices, and the three worked files are included with Fundamento Pro.

The full edition

All 30 chapters, six appendices, and the three worked files — Hotel A’s acquisition, Hotel B’s full USALI year, and the development pro forma. 213pp · EN

See all tiers

Not ready to commit? Parts I and II are free. Get the free excerpt →

PART I

Foundations

What a hotel actually is, and the numbers that run it.

  1. 01

    A business wearing a building

    A hotel is an operating business collateralized by real estate; every consequence in this book — value, tax, debt, staffing, exit — follows from that split.

  2. 02

    The metrics ladder

    Five numbers govern every hotel decision — RevPAR index, GOP margin, NOI after a stated reserve, DSCR, and cash-on-cash; everything else is commentary on one of the five.

    Run the arithmetic →
  3. 03

    USALI: the operating language

    Learn one statement format and every hotel becomes comparable — that is the entire point of USALI, and the 12th Revised Edition (mandatory from 1 January 2026) is the version this book speaks.

  4. 04

    Reading the deal: terms that change outcomes

    Per-key, room-revenue multiplier, comp set, flag, PIP, HMA, key money — each term is a number that moves price, and this chapter prices each one.

PART II

Should I Own a Hotel at All?

The only question that matters before any other.

  1. 05

    The four ways in

    Direct, franchised, REIT, or fund — the further you sit from the front desk, the more of the return is someone else's fee; each route's net is computed here on dated cash flows.

    Run the arithmetic →
  2. 06

    The honest operational load

    Apartment leases reprice yearly; hotel rooms reprice nightly — that single fact is the job, the volatility, and the return premium, and it does not respect your other commitments.

  3. 07

    How much belongs in hospitality

    Hotels earn a minority allocation sized to survive a 2020-scale RevPAR drawdown without a forced sale; the drawdown record (2001, 2008–09, 2020) is reprinted so the sizing is yours.

PART III

Buying One

Six chapters, one discipline: no number enters the decision until it has been rebuilt from primary evidence.

  1. 08

    Underwriting from the STAR report and the P&L

    Normalize the seller's statements to USALI before believing any of them — the trailing twelve is a story until the comp set confirms it.

  2. 09

    Market and demand

    A hotel is a bet on its demand generators; name them, date them, and check the supply pipeline before you underwrite a share of them.

  3. 10

    What a hotel is worth

    Cap the NOI after a real reserve, sanity-check per-key, let dated cash flows carry the weight — and remember the price buys a going concern, which property tax and depreciation treat very differently from a building.

  4. 11

    Financing it

    You will ask for 65%; DSCR and debt yield will hand you about 51% on our anchor — size the loan by the binding constraint before the LOI, not after.

  5. 12

    Diligence and closing

    The PIP is the price term the broker did not print; diligence is where you find it, and closing is where the seller shares it.

  6. 13

    Building or converting one

    Development pays a spread over buying stabilized only when land, ramp-up, and years are priced honestly — the side-case pro forma prices all three.

PART IV

The Three-Party Problem

Owner, brand, manager.

  1. 14

    Franchise economics

    On our 12-room inn the flag must lift RevPAR 19.8% (from $121.78 to $145.89) before an 11.9% fee stack breaks even — while an existing flag is only worth dropping inside a 14.2% give-back; run the arithmetic in both directions before signing either way.

    Run the arithmetic →
  2. 15

    Management agreements

    An HMA is agency law wearing a fee letter — base plus incentive for someone else's system; make the performance test, the owner's priority, and the exit real before the honeymoon prices them for you.

  3. 16

    Asset management: the owner's actual job

    Owning a hotel is a monthly job even when operating it is not; the owner's review in this chapter is that job, in ninety minutes, with the twelve questions in order.

PART V

Running It by the Numbers

  1. 17

    Rooms

    Revenue management is displacement arithmetic, not mystique — and a commission is a rate cut you agreed to in advance; the chapter prices the channel mix you actually have.

  2. 18

    Labor: the defining line

    Labor is the hotel P&L: staff to the forecast, measure cost per occupied room, and apply the tip credit as the statute writes it, not as folklore repeats it.

  3. 19

    F&B and other revenue: the honest chapter

    Most hotel F&B earns less than the space it occupies; run it where it fills rooms, shrink or lease it where it does not, and let the department schedule referee.

  4. 20

    Undistributed and fixed

    The lines nobody markets — A&G, POM, energy-water-waste, insurance, property tax — decide whether a good top line becomes a good year.

  5. 21

    Flow-through

    When RevPAR moves, flow-through is the number that says whether management deserved the year — and breakeven occupancy, computed for both anchors, is the number that says how much room you have to be wrong.

PART VI

What Will I Owe?

  1. 22

    The hotel tax stack

    Five taxes touch a hotel — income, lodging, property, payroll, sales — and only one of them waits for profit; one worked year on each anchor, every convention labeled.

  2. 23

    Deferral and shelter

    Hotels are the cost-segregation asset class — a large short-life share, worked to NPV with every assumption printed, passive-loss usability stated, and recapture priced at the exit rather than discovered there.

  3. 24

    How you hold it

    Opco/propco is about employees and lawsuits as much as taxes: separate the business that hires from the entity that owns, and let four conditions — not folklore — decide when the structure earns its cost.

PART VII

Owning It Well

  1. 25

    The seven hotel risks, each with one number

    A risk without a threshold is a worry, not a control; each of the seven gets one metric, one threshold, and the decision the threshold triggers.

  2. 26

    Insurance and climate: the new underwriting

    Business interruption is the coverage hotels actually use — buy it to the month of closure the worked example prices, and read the percentage deductibles before the wind does.

  3. 27

    The owner's dashboard

    Twelve numbers, monthly, ninety seconds — each with a definition from Appendix A, a threshold, and the action the threshold triggers.

  4. 28

    The twelve most expensive hotel mistakes

    Every mistake in this ledger is priced on our two hotels — skipping the PIP escrow, staffing to hope, confusing GOP with cash, spending the reserve — and the cheapest of them costs more than any advice ever will.

PART VIII

The Exit

  1. 29

    Hold, refinance, sell, or exchange

    Four doors, one property, identical facts, XIRR on each — the answer is a number, not a mood, and it changes with the debt market more than with the hotel.

  2. 30

    Selling well

    A hotel sells as a going concern: the data room, the WARN clock, the license transfers, and the PIP negotiation decide your net sheet as surely as the price does.