How to Buy a Hotel: A 9-Month Acquisition Timeline

If you want to know how to buy a hotel, the honest answer is it takes longer than you expect. A typical mid-market hotel acquisition runs about nine months from first interest to keys in hand. Buyers coming from residential or even commercial real estate assume the path is simple: identify, offer, close. Hotels add three layers that most first-time buyers don’t see coming: franchise approval, brand-mandated property improvement plans (PIPs), and financing timelines that start in Month 2, not Month 5.

The U.S. hotel investment market posted $24 billion in transaction volume in 2025, up 17.5% year-over-year, according to JLL’s Hotels & Hospitality Group. Mid-market deals ($5M–$30M) account for a significant share of that activity. The buyers who close fastest treat the timeline below as a risk map, running due diligence, financing, and franchise approval as parallel tracks rather than a sequence.

This guide walks through that timeline month by month: what happens at each stage, what kills deals, and where to focus your energy. For a deeper look at loan structures, see our hotel financing hub.

Month 1–2: Deal Identification and Initial Underwriting

The first phase is about finding the right asset and pressure-testing the numbers before you fall in love with the building.

Source deals through hospitality brokers, LoopNet, direct owner outreach, and auctions. Once you have a candidate, run these core hospitality metrics before anything else:

• RevPAR (revenue per available room): ADR multiplied by occupancy. Your single best snapshot of performance.
• ADR (average daily rate) and occupancy: the two inputs behind RevPAR.
• NOI (net operating income): the number lenders underwrite against.

A simple screening checklist keeps you disciplined:

1. Compare the property’s RevPAR to its competitive set. Below-market RevPAR signals either opportunity or trouble.
2. Confirm the deal can support a debt-service coverage ratio (DSCR) of at least 1.25x at your target loan-to-value (LTV).
3. Put the asking price in cap-rate context for the market and segment.

Submit a letter of intent (LOI) once the screen looks healthy. Earnest money at this stage is typically modest and refundable during due diligence.

What kills deals at this stage: Buyers who fall for the building before running the metrics. A beautiful property with weak RevPAR and thin NOI won’t underwrite, no matter how good the lobby looks.

Month 2–3: Due Diligence Kick-Off and PSA Execution

Once the LOI is accepted, you negotiate and sign a purchase and sale agreement (PSA), then open the due diligence window.

For hotels, due diligence typically runs 45–60 days for full-service properties and 30–45 days for limited-service, though the exact window is negotiated in the PSA. Use that window to build a complete data room and run a physical inspection that covers:

• PIP assessment: what the brand will require you to renovate.
• FF&E condition: furniture, fixtures, and equipment age and replacement cost.
• Brand standards compliance: where the property falls short of current flag requirements.

Order your inspection and PIP scope early. The PIP is where surprises live, and its cost can reshape your entire model. For how owners fund that work, see our guide to hotel PIP financing.

What kills deals at this stage: Discovering a brand-mandated PIP after you’ve gone hard on the deposit. A six- or seven-figure renovation requirement found in week six can erase your returns or kill the deal outright.

Month 2–4 (Parallel Track): Financing: Start Earlier Than You Think

This is where most first-time buyers lose time. Financing is not a step that happens after due diligence. It runs alongside it and should start the moment your PSA is executed.

Engage a lender or financing partner as soon as the PSA is signed. At this stage, lenders want:

• Your last 12 months of operating statements (the T-12)
• A pro forma
• The executed PSA
• Franchise context (brand, term, PIP status)

Getting a clean package in front of the right lender early is the difference between closing on time and asking the seller for an extension.

If you’re weighing programs, the choice usually comes down to SBA versus conventional or private capital. SBA 7(a) and 504 loans offer high leverage for owner-operators but take time: the SBA’s own 7(a) turnaround is 5–10 business days for its portion, while full closing typically runs 60–90 days from a complete submission. That clock can’t wait until Month 5. For a side-by-side view, read SBA versus private lender options and our breakdown of SBA hotel loan requirements.

This is where Bridge does the most work. Instead of approaching lenders one at a time, you submit one application to Bridge Marketplace and get matched to hospitality-specialist lenders, with the goal of competitive term sheets within 48 hours on complete submissions.

Bridge has facilitated over $500 million in financing across hospitality and business lending, with more than $250 million in hospitality alone in 2025. We package each deal to the lender’s underwriting criteria before it’s submitted, which is what prevents late-stage surprises. Use our pro forma builder to standardize your numbers first.

What kills deals at this stage: Buyers who start financing in Month 5 and learn their SBA lender needs another 45 days. By then the PSA clock has run out, and the leverage shifts to the seller.

Month 3–5: Franchise Approval Process

If you’re buying a flagged hotel, accept one fact early: franchise approval is not automatic, and it is rarely fast.

Each brand runs its own application, background, and financial-review process. Based on industry experience, plan for roughly 6–10 weeks at Hilton, 8–12 weeks at Marriott, 6–8 weeks at IHG, and 4–6 weeks at Choice, with the PIP negotiated as part of approval. These are practitioner estimates; actual timelines vary by deal complexity, property condition, and brand-level staffing. The franchisor reviews your experience, net worth, and the property’s condition before issuing a franchise approval letter, a document your lender will require before closing.

Negotiate the agreement terms that matter: term length, territory protection, the PIP scope and timeline, and any liquidated-damages clauses. If you’re buying an independent and flagging it, the conversation is different again; see financing independent hotel acquisitions.

Because the franchise letter is a lender condition, this is also central to how to get a loan to buy a hotel. The approval and the financing have to converge, which is another reason to run both tracks in parallel.

What kills deals at this stage: Assuming approval is a formality because you have the money. Brands reject buyers over thin experience, under-capitalization, or PIP disputes. A rejection late in the timeline unwinds the whole deal.

Month 5–7: Financing Closes, Conditions Clear

With franchise approval in progress, your lender works through closing conditions in parallel.

Expect to clear the following before clear-to-close:

• Appraisal confirming value and supporting your LTV.
• Environmental report (Phase I, sometimes Phase II).
• Franchise approval letter from the brand.
• Insurance meeting both lender and brand requirements.

Title and escrow run alongside these items. Hotels are more complex than standard CRE here: the real estate, FF&E, operating licenses, and franchise agreement often transfer through separate mechanisms. A clean title commitment on the real estate does not mean the franchise agreement assignment is clean.

What kills deals at this stage: Title defects and franchise-agreement assignment complications. An unrecorded lien or a franchisor that won’t assign the existing agreement can stall a deal days before closing.

Month 7–8: Operational Transition Planning

Financing and franchise are converging. Now you plan for Day 1 operations so the asset doesn’t lose momentum at handover.

Key workstreams:

• Staffing: Check WARN Act applicability for larger properties, and identify the key employees you need to retain.
• Brand training: Most flags require management to complete brand-standards training before or shortly after takeover.
• Liquor and gaming permits: These are state-specific and slow. Processing ranges from about 30 days to 180-plus days, with California routinely at 90–180 days and New Jersey reaching 90–365+ days. Start the application as early as legally possible.
• Systems: Plan the property management system (PMS) and reservation cutover, and re-register OTA channels under the new ownership entity.

What kills deals at this stage: New owners who arrive on Day 1 with no operational plan. A lapsed liquor license or a botched PMS cutover costs revenue immediately.

Month 8–9: Closing and Day-One Operations

Closing day is mechanical if the prior 8 months were disciplined.

Confirm wire instructions and escrow well ahead of time, and verify them by phone to guard against fraud. Coordinate the key handover and access transition for staff and systems. The brand flag change and exterior signage often lag the close by 60-plus days, so plan that timeline with your franchisor.

For the first 90 days, expect a modest RevPAR dip during transition. New ownership, system changes, and staff turnover all create friction. Plan cash reserves to absorb it rather than assuming Day 1 performance matches the seller’s trailing numbers.

Conclusion: The Timeline Is a Risk Map

The 9-month timeline is not just a project plan. It’s a risk map that shows exactly where deals die:

• An unscreened asset in Month 1
• A surprise PIP in Month 3
• A late financing start in Month 5
• A franchise rejection in Month 6
• A title snag in Month 7

Buyers who run due diligence, financing, and franchise approval as parallel tracks, rather than one after another, can close significantly faster, often shaving six to eight weeks off the timeline based on Bridge’s deal experience. The single biggest lever is starting financing early and packaging it correctly.

That’s the part we manage end to end. Request financing through Bridge Marketplace to compare hospitality-specialist term sheets and keep your acquisition on schedule.

Frequently Asked Questions

How long does it take to buy a hotel?

A typical mid-market hotel acquisition runs about 9 months from first interest to closing. Buyers who run due diligence, financing, and franchise approval in parallel can often shorten that by 6 to 8 weeks, based on Bridge’s deal experience. For a full breakdown of how to structure your financing timeline, see our hotel financing guide.

How much does it cost to buy a hotel?

Beyond the purchase price, budget for due diligence (inspections, environmental, legal), a franchise application fee, brand-mandated PIP renovations, and closing costs. PIP scope is often the largest variable, so confirm it before you go hard on your deposit. For PIP-specific funding options, see our guide to hotel PIP financing.

How do I get a loan to buy a hotel?

Engage a financing partner as soon as your PSA is signed. Have your T-12, pro forma, PSA, and franchise context ready. SBA 7(a) and 504 offer high leverage for owner-operators, while conventional, CMBS, and bridge options suit other profiles. Compare structures in our SBA versus private lender guide, or request matched term sheets through Bridge Marketplace.

Is franchise approval required to close?

For flagged hotels, yes. Lenders require the franchise approval letter as a closing condition, and approval can take 6–12 weeks depending on the brand. Start the application early and run it parallel to financing. Bridge packages your deal with franchise context included, so lenders underwrite with the full picture from day one. Get started here.