Garden Grove Hotel & Motel Property For Sale

The city of Garden Grove is located in the northern part of California’s Orange County. It is just 34 miles to the south of the Los Angeles city border. According to the 2010 U.S. Census, it had a population of 170,883 at that time. The city is home to the Garden Grove Freeway, which is State Route 22, and this cross the city from east to west.

Garden Grove Hotel & Motel Property for Sale & Lease – Should You Buy or Lease?

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 Garden Grove, where demand is high.
  • The option of having a fixed rate of return, which is available for both buyers and lessees, 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 Garden Grove, 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.

However, downsides exist with investing in hotel & motel property as well, including:

  • 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 purchase the entire operation.
  • Requiring you to have a good knowledge about the hotel industry in order to ensure that you are playing the market right.
  • The presence of some seasonality in hotels, which means you won’t always have a good or predictable month per month income.
  • Competition to make a single room purchase in particular being incredibly high, including with foreign investors vying for any room that becomes available.

To help choose between the two options, being aware of the trends and statistics in terms of prices, supply, and demand, can be very beneficial.

Garden Grove Hotel & Motel Property for Sale – Trends and Statistics

In all of Orange County, there has been a very strong demand for hotel and motel properties. In fact, demand has consistently outpaced supply over the past few years. It seems, however, that hoteliers across Orange County are struggling to invest in the developments required to meet this new demand. One exception to this is found in Garden Grove.

Garden Grove is seeing a significant expansion in its existing stock. These are projects that are being completed together with Anaheim. Between the two cities, some 3,000 new hotel rooms were being developed across 2014, the last time those specific statistics were gathered.

Garden Grove is also home to a number of new developments, specific to its own city borders. The Great Wolf Lodge is one of the most anticipated hospitality developments in all of Orange County. The lodge will be a hotel and water park, located in Garden Grove itself. It will comprise of 603 individual suites, and the water part will be 105,000 square foot in size. It has recently opened and reservations were already being accepted before the official opening, with occupancy rates soaring straight away. Room prices at the lodge range from between $260 and $600 per night, and these rates include admission to the water park. The project costed around $250 million to complete.

In 2015, the Hyatt Regency hotel, comprising of 656 rooms, was sold for $137 million to the Shanghai Construction Group, who purchased it from Xenia Hotels & Resorts. It is not yet clear whether this sale has had any impact on the overall hotel industry in the area.

Garden Grove Hotel & Motel Property for Lease – Trends and Statistics

There are currently no hotel & motel properties for lease in Garden Grove. These buildings tend to be owned through mortgage or outright purchase. However, as the statistics above have demonstrated, deciding to invest in hotel & motel properties is a good financial decision as these provide high yields and low risks. The hospitality industry as a whole in Garden Grove is incredibly strong and certainly one to build on. In fact, some suggest that the Garden Grove hotel and motel industry is actually one of the strongest in Orange County.