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Rare 9-bedroom Guest House In London For Sale

Streatham, London, UK
Asking Price:
£60,000 Furniture / Fixtures included
Sales Revenue:
£102,323
Cash Flow:
£36,323

Description

A rare opportunity to acquire the leasehold on a profitable guest house in South West London. The guest house is situated on a busy High Road in the heart of South London. There are an abundance of bars, restaurants and shops situated close to the guest house which is ideally located in a busy and vibrant location, with excellent road and rail links allowing easy access to central London and all of its major attractions.

The are 9 rooms available (5 double rooms, 2 triple rooms, 1 quadruple room and 1 single room) arranged over 3 floors each with flat screen TVs, tea/coffee facilities, bedding etc. with shared facilities (3 toilet baths and 2 kitchen). The property was recently renovated to a high standard (full HMO license) with all fixtures and fittings included in the sale.

The Opportunity
During the current management's stewardship, the business has had significant investment and this has enabled it to see a strong increase in its reputation and turnover. The property enjoys a first-class relationship with a local housing authority (LHA) in the area who refer guests for temporary accommodation. The guest house also receive private bookings from the various online travel agencies (booking.com, airbnb, expedia etc.) and the guest also usually has 1 or 2 long-term guests (>6 month tenancies) who provide steady income. The guest house has steady occupancy rate of around 85% due to the various streams of guest referrals available.

There is further potential and opportunity for an experienced operator to fully switch to either multiple local authority referrals to provide a more steady income or switch completely to private bookings (via online travel agencies) to provide a more lucrative stream of income.

Financials:
The single rooms are £35/night privately and £28/night to LHA
Double rooms are £50/night privately and £35/night to LHA
Triple rooms are £55/night and Quads are £65/night
Turnover from the start of trading -April 2019 to date, Dec-2019- circa £68,215 (i.e. £47,000- LHA, OTA-5,749.12, Other -e.g. long term guests- £14,647.14). Full year forecast- £102,322.50
Rent: £5,000/month
Misc Expenses- £500/month
No staffing costs
Net Profit from April 2019-Dec-2019- £24,215 (full year forecast- £36,322.50)

The business is forecasted to experience a growth rate of around 10-15%, year-on-year in line with accommodation business in a location such as London.

The guest house is currently on a 10 year renewable lease (>9 years remaining) taken on by an London-based asset management company who are divesting some of their interests to focus on major developments in 2020 so this turnkey opportunity presents a unique chance for either an experienced hotelier or first timer to break into the industry. The management team will be available for a short transition period as required.

Please note that this is not for the sale of the freehold property, it is for the sale of the business that comes with the leasehold of the property, therefore serious inquiries only. A non-disclosure agreement and further details (invoices, payment receipts, bank statements etc.) will be sent to inquiries with proof of funds readily available.

Property Information

Property:

Leasehold

Lease Terms:

10 year lease from April 2019, renewable for another 10 year if required.

Leasehold Rent:

£60,000 per annum

Location:

The guest house is situated on a busy High Road in the heart of South London.

Premises Details:

The are 9 rooms available (5 double rooms, 2 triple rooms, 1 quadruple room and 1 single room) arranged over 3 floors each with flat screen TVs, tea/coffee facilities, bedding etc. with shared facilities (3 toilet baths and 2 kitchen). The property was recently renovated to a high standard (full HMO license) with all fixtures and fittings included in the sale. Please see floor plan attached for details of layout.

Size in square feet:
1,722
Energy Performance Rating:
D

Business Operation

Expansion Potential:

There is further potential and opportunity for an experienced operator to fully switch to either multiple local authority referrals to provide a more steady income, switch completely to private bookings (via online travel agencies) to provide a more lucrative stream of income, or mix it up more evenly to increase income, especially over the busy summer in London

Competition / Market:

No competition on high road and existing relationships with LHAs definitely sets the business apart.

Reasons for selling:

The business is currently a non-core asset for an asset management company who are divesting specific assets in the London area.

Trading hours:

24 hours

Employees:
0
Years established:
2019

Other Information

Support & training:

The management team will be available for a short transition period as required and will be make introductions to the housing authority during handover.

Furniture / Fixtures value:
£40,000 - included in the asking price
Related Documents:

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