Hotels & Leisure
HOTELS
Hotels are essentially about cash flow analysis, including room prices and occupancy rates. Indeed following the recent market downturn there often was a situation where the cash flow valuation of hotels was below its contruction costs, a situation still present today in places that have hotel overcapacity.
In many accounting regions, due to high depreciation value of hotels, the industry offers a significant acquisition opportunity for various non hotel based profitable businesses.
Due to large economies of scale there is an opportunity for significant M&A activity in this area.
LEISURE
Theme parks, museums, water parks and increasingly stadiums form a large industry both with the private investors and government sector. Ticket based businesses offer a stable coupon based returns capable of financing via loans, securitisations as well as more innovative structures such as PIK notes. Due to large economies of scale there
Hotels and leisure are increasingly popular areas in both developed markets and the emerging ones. Due to significant operational economies of scale there is an opportunity for M&A activity in this area.