For Sale -Tourism Property New Zealand

Other types explained:

Within New Zealand leasehold businesses are a very common form of business ownership in tourism property. There are several reasons for this including:

Many simply wish to operate a business in tourism rather than be property owners.

The level of investment required to acquire a leasehold business is well within the means of many investors seeking a business opportunity.

For those who are entering the industry for the first time, purchasing a leasehold business minimises the level of risk compared with say the purchase of a freehold going concern.

Because the vast majority of tourism properties are leasehold, there will usually be many more business options available within a given set of criteria that may include region, size and business potential.

With a larger market seeking leasehold businesses there are always ready buyers when it comes time to sell and move to another tourism property or business opportunity.

Typically purchasers of leasehold property will be seeking to secure a long leasehold term as this secures long-term tenure for their business. Where the leasehold is available for new tourism accommodation developments, lease terms of up to 35 years or more are not unheard of. Obviously there is a benefit for the owner of the freehold in securing a long-term tenant from the outset. As the term of the lease decreases over time there is an effective transfer of the goodwill from lessee to lessor therefore some consideration may be required to secure an extension of the lease term.

Overall the purchaser of a leasehold business can through good management derive not only a very good income but also in building the business could expect to increase the value of the business investment.

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