How Much Does It Cost To Build a Hotel?
The travel and hotel industries are very good investments for many people. Building a good hotel is a sound financial investment, as the travel industry continues to grow. Hotels come in different sizes and types, from simple motels and inns to 5-star luxury, mega-hotels. For this reason, there is a very wide range of costs associated with this type of project. The national average range is $15,000,000 to $35,000,000, with most people spending around $25,100,000 on a 3-star hotel with 100 rooms. At the low end of the spectrum, it is possible to build a 2-story motel for $7,700,000, while at the high end, you can spend more than $65,000,000 on a luxury 5-star hotel.
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There is a big range of costs per square foot for hotel construction. This is because various types of hotels include varying amenities, areas, and materials. In addition, hotels built in urban areas usually have a higher cost per square foot than hotels built in more rural or suburban areas. For this reason, there is a hotel construction cost per square foot range of $140 to $450:
Cost to Build a Motel per Square Foot
The costs to build a motel ranges from $140 to $450 a square foot, depending on the state you are building in. Motels are built for much less money than larger hotels. They tend to be 2 – 3 stories, have few amenities, and have few common areas. Rooms of motels are cheaper to rent, making them the perfect choice for someone going on a road trip or who does not care about property amenities.
Cost to Build a 3-Star Hotel per Square Foot
Three-star hotels are considered standard hotels. Building 3-star hotel costs between $200 to $260 a square foot, depending on the area. They have lobbies, communal areas, and restaurants. They may have gyms and pools as well, although not all include these features. They often do not have as many amenities as other hotels, and the materials are usually standard grade.
Cost to Build a 4-Star Hotel per Square Foot
Depending on the location, building a 4-star hotel usually costs between $280 and $365 a square foot. Four-star hotels generally include more amenities and better materials than a 3-star. They often have a gym and other entertainment areas, spas, more than one restaurant, and possibly other shopping and services.
Cost to Build a 5-Star Hotel per Square Foot
Five-star hotels are luxury buildings that include unique and high-end services for their guests. This increases the cost to build per square foot to between $350 and $450, depending on the area. They include many services, high-end gyms, pools, spas, and restaurants. They also have more communal areas, shopping, and other amenities.
Hotel Construction Cost per Room
While the square foot is a popular way to break down construction costs, many hotels are also priced per room. This makes an easier determination of the project’s total cost by projecting the number of occupants, rather than the overall space. Like square footage, the cost to build a hotel per room varies on the type of hotel, although the location is important too:
Costs of Building a Motel per Room
The average cost per room to build a motel is around $77,000. Motels do not typically have many amenities, and the rooms are entered from outdoors, eliminating shared indoor areas. This means that if the motel has the same number of rooms as a better hotel, its construction costs are lower.
Costs of Building a 3-Star Hotel per Room
On averate, the cost to build a 3-star hotel per room is $225,000. Three-star hotels may have amenities and features for guests, but these are optional and vary by hotel. This is considered a standard-quality hotel with good quality but not luxurious features. There may be amenities like gyms and restaurants but not always.
Cost of Building a 5-Star Hotel per Room
Five-star hotels have an average cost to build per room of around $700,00. They have many of the same features as a 4-star hotel, but they may have more of them or better quality. In addition, 5-star hotels often include additional services for their guests than a 4-star hotel may. The rooms are usually much larger, so the hotel may have fewer rooms in the same square footage.
How Much Does It Cost To Build a Hotel?
The price differs as per the standard of hotel. The national average range is $13,000,000 to $32,000,000, with most people spending around $22,100,000 on a 3-star hotel with 100 rooms.
Specialty Hotel Construction Costs
In addition to regular motels and hotels, several hotels also cater to specific needs or other purposes. Some of these fall in with the “luxury” line of 5-star hotels, but others have their specific costs:
Average Cost to Build a Guest House
With Airbnb and the trend of catering toward travel, guest houses are becoming a more common phenomenon. For the average backyard guest house, costs start at $150 per square foot. For a luxury guest house meant for more people, costs go as high as $550 a square foot. A guest house is anything from a small house located on your property for friends and family to a bed-and-breakfast style inn with boutique amenities. Because of this, there is a wide range of associated costs.
Cost to Build a Casino
The cost to build a casino ranges between $350 and $600 per square foot, depending on the area. Casinos are considered luxury hotels and resorts in most areas. The idea is to encourage guests to spend money so that the business profits. To this end, the casino’s hotel portion is generally 5 stars, with many features and amenities and several restaurants and types of entertainment.
Cost to Build a Resort
Resorts are usually considered a destination stay. Depending on the area, they cost between $450 and $800 per square foot to build. Resorts usually offer relaxation and recreation to its visitors, making them a place where people take a vacation. For this reason, they are usually classified as luxury or boutique and are generally 5-star facilities with many services and features included.
Hotel Construction Cost Breakdown
Every hotel is various in size, scale, number of rooms, land, and construction material. That’s why your exact costs and percentages vary. However, it is possible to break down the various elements of building the hotel into percentages and categories that you can use to determine where your budget is going for this project:
| Breakdown | Percent of Total Project Cost |
|---|---|
| Opening Expenses | 3% |
| Furniture and Fixtures | 9% |
| Land | 10% – 21% |
| Soft Costs (Non-Construction Fees) | 12% |
| Hard Costs (Material, Construction) | 55% – 66% |
Process To Get Hotel Construction Cost Estimate Report
Here I am going to share some steps to get your Hotel Construction cost estimate report.
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