What this hotel earns depends on who runs it.
Today the property sits under a master lease: the tenant runs the hotel and pays a flat $24,800 a month. The lease can be terminated before closing, so a buyer can take over operations directly and keep the room revenue instead of the rent cheque. Move the controls below to see what that looks like at your own assumptions.
Pro-forma cap rate is the offering memorandum’s owner-operated net income of $369,360 over the asking price. Cap rates are unlevered — no mortgage payment is included in either figure.
Build your own scenario
Twelve licensed suites, 4,380 rentable room nights a year. Set the nightly rate and occupancy you believe you can hold, then adjust the cost and financing assumptions.
Comparable studios and one-bedrooms nearby book roughly $110–$270 depending on season and events.
3,285 occupied room nights a year.
Charged only on platform bookings — direct bookings pay none.
$62,415 of revenue booked on your own website at 0% commission — saving $9,362 a year. Past guests, social media and email marketing grow this over time.
Housekeeping is billed per reservation, not per night — 939 reservations a year at these settings.
What the cleaner and supplies actually cost you per turnover.
Guests cover housekeeping in full and it contributes $28,157 a year.
Set to 0% if you plan to self-manage. Managers commonly keep the cleaning-fee margin as well.
The trailing twelve months total $82,899, but that is the cost of owning the building under the master lease — the tenant carries most utilities and building maintenance today, and taxes are still on the old assessment. Operating directly changes each line, so set them yourself.
In place today under the current assessment. Florida reassesses close to the sale price after closing, so budget higher.
Owner-operated hotels also carry general and liquor-free liability, not just property cover.
The tenant currently carries most of this; a direct operator pays all of it.
Not in the trailing statement — the master-lease tenant absorbs building upkeep today.
Accounting, legal, hotel and business licences.
Property-management system, channel manager, website, direct-booking marketing.
Asking $3,950,000.
$1,382,500 of equity.
Hotels are valued on income, so the cap rate you apply sets the value.
Miami Beach hotel real estate has historically compounded in the low-to-mid single digits.
Cap rate here is net operating income divided by your purchase price, with no financing in it — mortgage payments only appear in the cash flow, cash-on-cash and DSCR figures below. It moves when you change the operating cost assumptions.
What the equity could look like in 5 years
3.0% annual appreciation · projection, not a guaranteeAppreciation compounds on the property value, the loan balance shrinks with every payment, and operating cash flow adds up alongside both. This is a projection built on your assumptions above — actual Miami Beach values and income will vary.
Month by month
Annual totals spread across Miami Beach’s seasonal demand patternWhere the money goes
| Gross room revenue | 3,285 nights × $190 | $624,150 |
| OTA & channel commissions | 15% on platform bookings — 10% of revenue booked direct pays none, saving $9,362 | ($84,260) |
| Housekeeping & supplies, net of guest cleaning fees | 939 reservations × $95 cost, less $125 charged to the guest | +$28,157 |
| Staffing & management | 10% of room revenue | ($62,415) |
| Fixed costs a year | Taxes, insurance, utilities, maintenance, fees | ($134,318) |
| Net operating income | 59% margin | $371,314 |
| Value at a 7.00% cap rate | Income ÷ cap rate | $5,304,484 |
The same building, two business models
Under the master lease the owner collects rent. Terminate the lease at closing and the owner collects room revenue instead — and carries the operating costs that come with it.
Master lease rent and utilities of $298,597 over the trailing twelve months, against $82,899 of ownership costs.
- Property taxes$32,318
- Insurance$28,985
- Utilities$12,577
- Professional fees$8,400
- Business licenses$139
- Net operating income$215,698
At $190 a night and 75% occupancy, net operating income is $371,314 — +$155,616 against the lease, and a 9.4% return on your purchase price.
Price the season, not the year
A single annual nightly rate hides how this market actually works. December through April is priced at a premium against event-driven demand; August through October is protected with weekly and monthly stays. Set each block separately, then send the blended result to the model above.
Nightly stays, minimum-night rules over events, premium pricing.
151 nights in this block · 1,595 suite-nights sold
Mixed nightly and weekly stays, weekend-led demand.
122 nights in this block · 1,083 suite-nights sold
Weekly and 30+ day stays hold the floor: relocations, medical, crews, snowbird arrivals.
92 nights in this block · 662 suite-nights sold
Where the year’s revenue comes from
- Room revenue
- $691,634
- Blended nightly rate
- $207
- Blended occupancy
- 76%
- Revenue per available room
- $158
Pushes the blended rate and occupancy into the sliders above so the returns and financing update.
Length of stay is a second lever
The hotel licence allows any stay length. Short stays maximise rate; longer stays cut turnover cost and protect the softest months.
| Nightly (1–6 nights) | Full rate Highest cleaning + commission | High season and event weeks |
| Weekly (7–29 nights) | ≈10–20% discount One clean per stay | Shoulder months, families, remote work |
| Monthly (30+ nights) | ≈30–40% discount Lowest turnover; no transient tax | August–October floor, snowbird pre-season |
The Miami event calendar
Recurring city-wide demand spikes an operator can price into. Rate lifts are typical market behaviour, not a guarantee.
- Art Basel Miami BeachEarly December2–3× nightly rate
- New Year & holidaysLate December2× nightly rate
- South Beach Wine & FoodFebruary1.5–2×
- Miami International Boat ShowFebruary1.5–2×
- Formula 1 Miami Grand PrixMay2×+
- Miami Music Week & UltraMarch2–3×
- Spring breakMarch – April1.5×
- Swim WeekJune1.5×
One licensed listing, every booking channel
Because the hotel licence permits nightly stays year-round, the suites can be listed across the full hospitality distribution stack rather than the limited channels open to a residential short-term rental. Wider distribution is what holds occupancy through the softer summer months.
What is being sold
Steps from the beach and the eastern entrance of Lincoln Road, inside a corridor absorbing more than $4 billion of new luxury hotel, branded-residence and infrastructure investment. The hotel licence is the scarce part: it permits legal nightly rental year-round in a city where most short-term rental is prohibited.