This Hotel/Motel Valuation Guide (“Guide”) is written in response to the Alberta Municipal Affairs “Request for Proposal:  Property Assessment in Alberta Handbook’s Hotel/Motel Module Review”.  The intent of the guide is to assist assessors from a practical perspective in the valuation of hotel/motel properties for assessment purposes pursuant to Alberta legislation.  The original guide was developed in 1998 and since then new methodologies, techniques and terminologies have evolved.  This guide will explore these changes and discuss current divergent opinions within the appraisal/assessment community.  Particular attention is given to the “non-realty” assets of hotel/motel properties, which are controversial in current thinking and opinion.

A review of the Alberta Hotel/Motel Guide dated June 1998 was undertaken and where appropriate, certain parts have been adopted.  A literature review across North America from an assessment and legal perspective was conducted and where appropriate the results are included as part of the source material for the Guide.  At the request of the Ministry, a Cost Approach example of a gallonage hotel and a Direct Comparison Approach example of mid-size motel/hotel are included.

This Guide is intended to assist assessors who are familiar with the basics of assessing investment properties using the three approaches to value but who have varying degrees of experience in the assessment of hotel/motel properties.