"Mike, How Are You Going to Survive When Hotels Are Going Down in a Recession?"

It's true.

Hotels suffer during recessions.

When people lose their jobs and businesses cut back, they cut back on travel and therefore hotel occupancy goes down.

So how will my hotels survive as we enter into a recession?

I PREPARED FOR IT BY BUYING at the RIGHT PRICE I bought my hotels CHEAP or way below market. Hence, even if occupancy goes down to 50%, my hotels won't make as much money but they will be able to pay the bills.

I PREPARED FOR IT BY BUYING in the RIGHT LOCATION I bought my hotels in the right location with DIVERSFIED DEMAND DRIVERS. I don't buy in towns/cities that are one-trick ponies. During a recession, not all industries suffer. For example, hospitals and the healthcare industry tend to do well during recessions.

I PREPARED FOR IT BY BUYING the RIGHT HOTEL TYPE During the Covid induced lockdown of 2020, EXTENDED STAY hotels actually THRIVED not just survive. That's why half of my hotels are extended stays. I get the best of both worlds - the stability of apartments and the cashflow of hotels.

I PREPARED FOR IT BY KEEPING PLENTY OF CASH RESERVES Having plenty of cash in reserves helped me as a hotel owner to survive Covid. While other hotel owners were crying and losing their hotels, I was buying. During the worst time in the hotel industry, I did not call my investors for a capital call but instead, I reassured them that we were fine and I showed them the plan on how we'd go through it.

A rising tide raises all ships. It was easy to make money with apartments and hotels when the economy goes up.

But when the tide goes out, it will reveal who are swimming naked. A recession is a good time to see who are the syndicators who are the pretenders and who are the real INVESTORS.

I've been through 2 recessions now - 2008 and 2020. During the first one, I did not lose my houses and apartments. In fact, I bought more. During the 2nd one, I did not lose any hotel. In fact, I bought more.

So I welcome another recession. It's a time to buy MORE!

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