City of Orange is a city in Orange County, California and it is just outside of Santa Ana, the county seat. It is a unique city in the county because, unlike in other cities where the old buildings have been demolished in the 1960s, Orange kept the the buildings with their old architecture intact. As a result, many of the properties, and particularly those in the Old Town District, are from the pre-1920s. Naturally, there is a strong emphasis on antique stores in this part of the city as well. It is this uniqueness that helps to attract tourism, as well as visitors from other parts of the county. According to the 2014 U.S. Census, Orange had a population of 139,812 at that time. The health care system, the government, and educational institutions are the biggest employers in the city.
The city of Orange, and the county as a whole, are a very affluent part of the country, as well as one that is very popular with tourists. This is in part due to the Disneyland Resorts in the county, and also its miles of beaches and surfing opportunities, and its pleasant coastal climate. As a result, there are always opportunities to enjoy nature, as well as the many hotels, bars, and clubs that are offered throughout the entire county.
City of Orange Hotel & Motel Property for Sale & Lease – Should You Buy or Lease?
If you are interested in investing in a hotel & motel property, you have two broad choices available to you: buying or leasing. There are pros and cons to both leasing and buying hotels and motels. As an investment, whether you purchase or lease the property, and whether you look into an entire hotel or motel or a single room only, the advantages include:
- A low requirement for capital investment (if you purchase a single room), while ensuring a high return, particularly if you invest in a hotel room in the county, where demand is very high.
- The option of having a fixed rate of return without having to take on any of the risks of hotel management. This means that if there are customer complaints or breakages, the responsibility lies with the hotel manager.
- Having a steady return available to you, particularly in Orange County, with high average daily rates.
- Being able to use the hotel or room for your own personal use as well, although this means that you will not earn an income at that time.
Essentially, hotel & motel properties offer investors a profitable, low risk method of having a diverse investment portfolio.
Meanwhile, there are also some disadvantages to contend with when investing in hotel & motel property:
- Collecting returns can be incredibly complex in terms of jurisdiction and taxes.
- Not having an influence on the marketing policy of the hotel, or of its management strategy, unless you buy the entire operation.
- Requiring you to have a good foundation of knowledge in the hotel industry in order to ensure that you are playing the market right.
- There is some seasonality involved in hotels, which means you won’t always have a good or predictable month per month income. This is not exactly a disadvantage as this can be predictable and business plans can be adjusted based on this.
- Competition to make a single room purchase in particular being incredibly high, including with foreign investors vying for any room that becomes available.
City of Orange Hotel & Motel Property for Sale – Trends and Statistics
Orange is home to a large number of established hotels and motels. Due to its proximity to Disneyland Resorts and a variety of other points of interest in Orange County, it is a very popular area with tourists. However, there are currently no hotels for sale in the area. It is believed that this is due to the fact that there have been very few new developments since 2015, and for those that have been developed, all rooms have already been purchased.
City of Orange Hotel & Motel Property for Lease – Trends and Statistics
Similarly, there are currently no hotel and motel properties for lease in Orange. Again, this is due to the market being fully established.
As can be seen from above, the investment market for hotel and motel properties in Orange, CA, is not very positive at the moment. That said, with a significant boost in the economy of Orange County as a whole, there is a chance that new developments will take place. As an investor, keeping your eye on movements within the commercial real estate market as a whole should always be a top priority. What the lack of available properties also means, is that investing in hotel and motel properties in Orange is likely to be very successful. As such, if a property does become available, be that for lease or for purchase, you should take the opportunity to grab it.