What a hotel is worth — three methods, one defensible range
A hotel valuation that only shows one number is not finished. Cap the normalized NOI for an income value, sanity-check it against a per-key range for the market, and run a discounted cash flow on dated flows to weight execution risk — three methods converging on one range is what a defensible opinion looks like, and a valuation that cannot say where your price sits inside that range is not done.
The income approach caps normalized NOI (see underwriting a hotel) at a market rate to produce a value; the per-key approach compares the implied price per room to recent comparable sales in the same market and chain scale, as a sanity check rather than a standalone method; the DCF approach discounts a dated, multi-year cash-flow projection including a terminal or exit value, and is the method most sensitive to the assumptions behind it.
On a worked $14.72M property, the income approach produced a range of $13,603,638 to $15,378,026, the per-key screen implied $156,500 per key, and the DCF produced $14,011,747 with a projected exit value of $18,830,617 at the end of the hold. All three converge on the same neighborhood as the actual price — fairly bought, not a bargain, priced for execution rather than luck.
The per-key number is the one most often misused: it is a screen for whether a price is in a defensible range for the market and product type, never a valuation method on its own. A buyer who leads with "it pencils at $X per key" instead of a capitalized, normalized NOI has skipped the part of the analysis that actually prices the asset.