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Martens Appraisal completes work on hotel appraisal in Kansas

hotel appraisal kansas

Lee Whyte, MAI recently completed work on a hotel appraisal in Hutchinson, Kansas. The report was prepared for traditional lending purposes.

Hotel appraisals in Kansas are much more difficult than other types of commercial real estate appraisals and should really be left to the experts.

In general, a combination of three methods will be used in a hotel appraisal in Kansas: income, sales comparison and the cost approach. The income approach is an assessment of the property’s revenue-earning power and there are several types that may be used. The first is overall income capitalization, which is fairly common and quite useful. In this method, hotel cap rates are referenced for a wide range of hotel types. (The cap rate is as a ratio comparing income and capital value.) A discounted cash-flow analysis is useful for major full-service hotel assets in larger cities. It may not be as relevant for limited-service hotels or for full-service hotels in secondary cities. Finally, a gross-income multiplier method only considers revenue and not expenses and has relevance for older motel properties in smaller communities, but little usefulness to most other hotels.

The sale comparison approach examines comparable property sales in the same market area. Some might argue that this approach is not as accurate, because income is such a critical factor in hotel acquisition.

Finally, the cost approach is an estimate of the current value of the land, the replacement cost of buildings and other structures and any potential loss in value from depreciation. It is typically most applicable in newer hotels or those that might be undergoing extensive renovation.

In order to arrive at a valuation, there are a number of steps the hotel appraiser will take: A comprehensive review of the hotel, benchmarking its performance against its competitors in the market to determine if the hotel is under or overperforming to determine how well the hotel is operating. After that, the operational expenses are reviewed and benchmarked against the market to determine the efficiency of the property. The appraiser will also talk to market participants to see what kind of return investors are looking for and what the overall market is doing.

Hotel properties differ so much from other types of real-estate asset in terms of their diverse features, tangible personal property, such as spa and restaurant equipment, and intangible assets, such as reputation, brand affiliation, and staff, making a hotel appraisal very different from a conventional office, retail or industrial appraisal.

Martens Appraisal is lucky to have Lee Whyte, MAI as our expert in hotel appraisals, Lee has performed hundreds of hotel appraisals nationwide, with a particular emphasis on hotel appraisals in Kansas. Lee understands that no two hotel appraisals are the same and differences in locations, management and the physical property all come into play in a hotel appraisal.

About Lee Whyte, MAI

Lee has over 30 years of appraisal experience with Martens Appraisal. She is a graduate of Wichita State University, with a Bachelor of Business Administration Degree in Finance. She served as past president of the Greater Kansas Chapter of the Appraisal Institute and participated in the Young Advisory Council of the Appraisal Institute for two years. She is currently certified under the Appraisal Institute’s Continuing Education Program. As our senior appraiser, Lee plays an integral role in the training and guidance of staff appraisers.

Lee has extensive experience with hospitability/lodging facilities; office buildings, including multi-tenant and corporate single tenant offices and medical facilities; retail centers, including neighborhood, community and regional shopping centers, and single-tenant retail properties; special purpose properties, including fitness centers, places of worship and others.

Lee’s appraisal experience is throughout the Midwest – specializing in appraisals in Kansas and Missouri.

About Martens Appraisal

Martens Appraisal has been providing commercial real estate services in Wichita and throughout Kansas since 1948. Under the leadership of four MAI designated appraisers, our appraisal team comprises over 100 years of combined experience.

If you would like to know more about our firm, please visit or contact Andrew Braun today to order an appraisal.

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