Hospitality re-trades: a checklist before you re-sign the LOI
When hotel assumptions move, isolate the operational change before reopening price and terms.
01
Name the changed fact
A re-trade should begin with evidence: a physical condition, operating result, financing constraint, or legal issue that was not reflected in the original terms. Market anxiety alone is not a new fact.
02
Reconcile the operating model
Update only the assumptions affected by diligence.
- Room count and out-of-order inventory
- Normalized ADR and occupancy
- Labor and franchise costs
- Near-term capital plan
03
Keep the remedy proportional
Price, escrow, seller work, and closing conditions solve different risks. Match the adjustment to the issue rather than using every diligence surprise to reopen the entire bargain.
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