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Hospitality Sector Objective

In this course, you construct a model from scratch building assumptions for a 5 stat hotel.In this video, you develop a 3-statement model completely from scratch, inputting historical data and assumptions to project out financial statements using step-by-step instruction on selecting, locating, and developing appropriate projection drivers. You learn how to factor in cost drawdowns for a hotel and how much of investments will come from debt and equity to finance the project. Candidates also learn how the hotel will structure its cash flows appropriately so that capital raising issues can be addressed. Key revenue drivers from the sectors are identified and the revenues and subsequent costs forecasted accordingly.

What Candidates Learn

  • Revenue drivers of a hospitality group
  • Gestation period from construction to actual revenue earning
  • Benefits of using Net Present Value (NPV) over Internal Rate of Return (IRR) to calculate the financial viability of a project
  • Building Dynamic Business Models from scratch with Multiple Scenarios using XIRR, MIRR.
  • How to build assumptions and the rational of taking them before starting your business model
  • Using different approaches like lowest common denominator and annual equivalency cash flow for determining the value of projects that have different life spans
  • Calculation of free cash flows to firm and free cash flows to equity and how they are used to determine the profitability of a project
  • How To Take A Decision For A Project Using Different Techniques Like Data Tables, Scenario Manager, Solver Etc.

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