'Nobody wants to inherit a hotel': Thousands of family-run hotels across Europe are cropping up for sale as a generation of owners retire

“The majority of owners are selling,“ Melanie Zimmerman, owner and realtor at MVP Chicago Real Estate, tells Moneywise, adding that independent hotels are hitting the market more than franchised properties. “Typically, there is no corporate entity supporting them. The individual owners are responsible for managing the hotels and handling the day-to-day operations.”

When an owner decides they no longer want to own or operate the hotel, either an heir has to take over the ownership and management responsibilities, or the hotel has to be sold, she says. But, overwhelmingly, heirs don’t seem to want in on their family businesses.

Why and where are family hotels going up for sale?

There isn’t a single database tracking every family-owned hotel being sold due to succession, but individual listings show the pattern playing out around the country.

In Wisconsin, for example, the 20-room Park Motel in Marshfield is listed for $998,000 after 30 years of family ownership. The owners are retiring, according to the listing.

In Illinois, the Tara Point Inn & Cottages in Grafton was listed for $2.7 million as the owner, Alison Rohan, and her family prepare for retirement. Rohan and her sister own the property, while she and her husband operate it. She told the Telegraph that the arrival of another grandchild helped motivate their decision to step away.

In South Dakota, the family-run, 35-room Hills Inn motel near Mount Rushmore has gone up for $1.8 million since the owner is retiring after 31 years.

But these aren’t necessarily distressed businesses. In fact, some owners are selling precisely because they have built valuable businesses that can be handed to someone else — and passing the hotel down doesn’t always make sense.

“Selling is often the practical answer,” Viktor Lobov, founding partner at Meliora Advisory, a lower- and middle-market advisory firm, tells Moneywise. “I’d put it more directly than that: A sale is not usually the failure of the succession plan. It is the version of the plan everyone can actually sign.”

Is selling simpler than passing down a hotel?

For many owners, selling the business is the simplest solution. If a hotel owner has multiple children, for example, passing it down can get complicated.

“An operating business cannot be divided the way a passive asset can,” Lobov explains. “One heir wants income, one wants liquidity and one wants to run the place. A hotel can serve two of those at a time. It cannot serve all three.”

Because “You can’t realistically divide an operating hotel among siblings,” Zimmerman adds that selling is often the smarter move.

“If they can’t agree on who will manage the property and who will cover the maintenance expenses, selling the hotel is a much more practical way to resolve the situation,” she says, adding that the expenses of a hotel never stop. “You have payroll, loan payments, and necessary repairs, regardless of whether the property has been in your family for generations.”

After all, running a hotel isn’t quite like inheriting a traditional piece of property.

“It’s not simply about owning a physical structure,” Zimmerman says. “Owning a hotel requires ongoing involvement throughout the week and month … For a family member to retain ownership and continue operating the hotel, someone in the family has to actually take responsibility for the day-to-day management and operation.”

A family member who inherits a hotel may be taking on an operating business with employees, maintenance, guest complaints, booking systems, insurance, taxes, renovations and around-the-clock responsibilities.

Oftentimes, families can use the money from the sale of the hotel to address outstanding end-of-life expenses.

Lobov adds that deferred capital expenditure is important to keep in mind.

“In the last years of a founder’s tenure, an owner-operated property tends to run on maintenance rather than reinvestment, because the founder’s horizon is shorter than the asset’s,” he explains. “That is a rational decision for the founder and an expensive inheritance for the next generation, who receive both the property and the bill required to keep it competitive on rate.”

Then there’s the debt.

“The next generation has to re-qualify, and lenders underwrite the operator rather than the name over the door,” he says. “A personal guarantee that the founder could carry on 40 years of relationships and a demonstrated record is a very different proposition for someone in their 30s who has neither yet.”

Concentration is the piece to the puzzle that families discuss least, yet feel most, he adds.

“For most of these owners the property is the majority of household net worth; keeping it means the family balance sheet stays in a single asset, in a single market, with a single demand profile,” he says. “Estate liquidity compounds all of it, and I’d leave the mechanics to a tax adviser. The principle is simple enough: an obligation that has to be settled in cash, secured against an asset that is anything but liquid, on a timetable the family did not choose. Put those together and the real question is not whether the family is capable of operating the hotel; it is whether they would buy it today, at the price they are currently declining.”

Are family-run hotels actually good investments?

The operations and costs are largely why existing hotel owners and investors who have hospitality experience tend to buy up independent hotels — not heirs. But even they are being cautious.

“Buyers today are looking at the current cost to operate a property, including staff, insurance, and loans, compared with what a single room was originally valued at,” Zimmerman says. “I tell all my clients to calculate if the net income of the rooms — after payroll, staffing and repairs — is realistic.”

That doesn’t mean the properties themselves are bad investments. The CBRE forecasts hotel revenue per available room, or RevPAR, to grow to a modest 2.5% in 2026 and 2.1% in 2027.