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Should we take no for an answer?

Start a Hostel

Irenesky started this discussion 14 years 3 months ago

My husband and I would like to start a hostel in Austin, TX. Our inspiration for the idea came after we saw a piece of property for sale or lease in a perfect location. We became determined and even wrote up a rough draft of a business plan, an estimated floor plan, and landscaping ideas. It seems to be a no-brainer that the hostel would be profitable given its location and general ambiance of the neighborhood and city. We inquired into the possibility of obtaining the property and received this response:

"I reviewed this with the owner and he will not entertain this use on the site due to the long delay in permitting and high restaurant interest at this time. Thank you for your consideration."

There are already TONS of restaurants in the area and it really doesn't seem logical that they want to add another one in a highly competitive market! :mad: Whereas a hostel would have very little competition and would add to the overall variety of small businesses in the neighborhood.
We haven't looked into how long the permitting would take and perhaps they have a fair argument on that...My question is, should we give up on our dream location and look elsewhere or try again to persuade them that we have a great idea? Anybody have any advice on how to convince them?

Thanks!

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soi1david

14 years

seems like you're having to convince the "Owner" in a direction that he does not agree with. Thats a hard one, how long will he give you a lease for?
getting the permit from the council, when they have no experiance of this type of Business, would mean it would take alot longer.
I think Austin would be a great place for a hostel ( It's a special place in Texas).
So I'd go about it like this.
Go to the Council (goverment office that issues these things) have a talk with them to see if they are open to such an Ideal, You can tell pretty much at that time the odds of it being allowed. Don't mention a exact location IF you can help it. But note when talking to them, if there are restricted areas that It would not be allowed, what sort of expences would be expected (taxes, local costings etc..) and saftey requirements ( fire escapes, fire sprinklers, legal capacity etc..) this could cause you to not try if to expencive ( possibly the reason there are none already).
If satisfied of profitability, Take this info to the "Owner" and try asking him again. If he still refuses, start looking for another location. If you are capable to buy a property where you become the "Owner" would put you in total control (If you failed you could always sell it) or Find an Owner that would treat you well and agree. If your ideal is too good they may try it themselves. If you are sucsessful, You can bet many will follow, and more will open.

Lets us know how it all turns out.
Best of luck to you--- I really think a hostel in Austin would do well.

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crhostel

14 years

I would think that the owner of the lot wouldn't really care about what type of business goes in there. If it was my lot, I would be most concerned with the potential lessee or buyer having the ability to pay. Pointing out that the permitting process would be a lengthy one means that he doesn't want to sit on the lot while you guys try to get your permit. Or if he leases it to you and then you go to get your permit, can you afford to carry the lease costs until your business opens? Why should he take a risk when he may already have a great lessee/buyer with money to take the property?

It's too bad, but maybe you should look elsewhere, or lease and convert an existing building?

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Irenesky

14 years

Thanks for the advice guys :-) We actually ended up finding another property that is already zoned for hotel/motel, in an even better location! It's larger and more expensive, so now its just a matter of getting the numbers to work out. Going to talk to the owner this week...he actually seems interested :-) I'll keep u posted on our progress!

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soi1david

14 years

yes Keep us posted. I feel that you are on a better Start with these developements. It's always better with an owner that is happy to work with you.
Luck and fourtune to you.

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