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Buying a cabina/hostel

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My boyfriend and I are considering buying a simple cabina or hostel that caters to international travelers, possibly 10 to 20 rooms. We plan to spend several months just traveling around before we settle down. Has anyone had any experience doing buying and running such an operation? We are in our late 50s and are SICK of working in our respective professional careers and want something that will bring in a little income, give us something to do and meet travelers. We would like something that just provides a room with a TV, possibly internet, private bath, maid service, and coffee and continental breakfast - that's it! We don't want a B&B because running that is a 24/7 job.

 

I have substantial experience staying in various hostels/youth hotels and cabinas all over Europe, Mexico and CR, and we think we might enjoy the lifestyle. We know we can't work it ourselves except to manage it and will have to hire local support staff.

 

Thanks!

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My boyfriend and I are considering buying a simple cabina or hostel that caters to international travelers, possibly 10 to 20 rooms. We plan to spend several months just traveling around before we settle down. Has anyone had any experience doing buying and running such an operation? We are in our late 50s and are SICK of working in our respective professional careers and want something that will bring in a little income, give us something to do and meet travelers. We would like something that just provides a room with a TV, possibly internet, private bath, maid service, and coffee and continental breakfast - that's it! We don't want a B&B because running that is a 24/7 job.

 

I have substantial experience staying in various hostels/youth hotels and cabinas all over Europe, Mexico and CR, and we think we might enjoy the lifestyle. We know we can't work it ourselves except to manage it and will have to hire local support staff.

 

Thanks!

If you were 20 or 30 something I'd say go for it but at 50 something you don't want to bite off more than you can chew. Running a business of any kind is very challenging here and the hospitality business is a big mouthful of hard , very hard , work even with ample employees. I know many people here in the hotel/hostel business and it's 24/7 work and alot of stress. You cannot simply expect your employees to learn or perform tasks or perform them consistently as you wish. This is a very different culture. You will have to be at the helm at all times. And learn the labor laws inside and out. There's a novel called " Don't Stop the Carnival " about a couple from NYC whose dream of owning/operating a hotel in the Caribbean turns into an unimaginable though hysterically funny nightmare. Though the book is very old it is still absolutely dead on realistic in its descriptions of the pitfalls and setbacks that beset people who have bitten off more than they can chew in a tropical country. Most of the foreign owned hospitality businesses ( hostels, hotels , bars and restaurants ) where I live fail in one or at most 2 seasons for multiple reasons the biggest ones being lack of prior experience and local knowledge. Those who've exhausted their savings end up trapped and very unhappy here . So if you go for it make sure you've got the money saved to call it quits and move on.

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The tourism business in many areas right now, is pretty bad. And something that has "...room with a TV, possibly internet, private bath, maid service, and coffee and continental breakfast" is not a simple cabina or a hostel.

Since you are aware that you cannot actually perform the labor you which means you have read the 'rules & regs' for living here, but you will both be required to apply for residency, independently, since you are not married. That's a lot of money, to tie up.

I agree with Pam, this is a very time consuming business, even if you only have 2 rooms filled, and you will need to be there 24/7 for a long time until you know your staff. You will have to pay someone to 'do everything' so with the funds coming in dwindling rapidly, check out how much the INS and CAJA will cost you per month for every employee.

One of the regular posters who own a business here, has posted the biggest problem is dealing with the municipalities and every changing rules.

Edited by costaricafinca

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If you are interested in purchasing a small hotel, hostel or "cabinas" in Costa Rica, here is my advice:

 

1. Travel here 3 or 4 times and visit several areas where you think you might like to live and work. Stay in that area for at least a week, more if possible. Seek out lodging like what you are thinking about buying. Stay there and be very observant of everything. You are not a tourist happily skipping off on a tour somewhere, you are researching a business potential. Talk to the owners about what they have to do for the "paperwork" and red tape kinds of things, how easy/hard it is to work with the municipality, what about employees, etc.

 

2. Understand that when you own a business like this, it can be very aggravating as can anything where you deal with the public. Think of all the problems hotels can have from unruly, drunk guests to stopped up toilets at midnight to showers that won't produce any hot water on a Sunday evening. Decide if you are ready for this. Costa Rica may seem like some kind of paradise to you, but if you own a business like this, it is work, work, work and very little vacation. Yes, it is work in "paradise" but still work.

 

3. Research and understand everything about obtaining residency, finding a good lawyer, rules and regulations for running a business, including dealing with employees.

 

4. If you don't already speak Spanish, learn it. It is essential if you are going to be doing business here.

 

We all of us came here with a dream. Some made the transition successfully and others didn't. I am not trying to discourage you but just hoping to bring in a little reality. If your dream is strong enough and you understand all that is involved, you will probably be just fine.

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My boyfriend and I are considering buying a simple cabina or hostel that caters to international travelers, possibly 10 to 20 rooms. We plan to spend several months just traveling around before we settle down. Has anyone had any experience doing buying and running such an operation? We are in our late 50s and are SICK of working in our respective professional careers and want something that will bring in a little income, give us something to do and meet travelers. We would like something that just provides a room with a TV, possibly internet, private bath, maid service, and coffee and continental breakfast - that's it! We don't want a B&B because running that is a 24/7 job.

 

I have substantial experience staying in various hostels/youth hotels and cabinas all over Europe, Mexico and CR, and we think we might enjoy the lifestyle. We know we can't work it ourselves except to manage it and will have to hire local support staff.

 

Thanks!

Please bear in mind that substantial experience as a guest is the equivalent of no experience as an owner/operator in this ( or any ) business. No insult to you intended. What you observe as a guest is only the surface and what takes place beneath the surface is complex , dramatic and exhausting. Having had alot of experience in the hospitality industry I can assure you that your hosts go to great lengths to prevent you and shield you from seeing or even speculating about what's going on behind the scenes.They want your visit to be a seamlessly pleasant experience in hopes that you'll return and that you'll tell your friends to visit their establishment as well. Eleanor gave you a few clues ( #2 ) as to the perpetual problems that occurr on a daily basis in this business. Hostels/hotels in the 1st World ( states and Europe ) are no exception to the daily ordeals that make this a challenging business but here in the 3rd World there are all those problems and many more that could only and regularly do happen in the 3rd World. As I write there are proprietors ( foreign ) in my town who are on the verge of going broke and losing their sanity in spite of all their hard work and their enormous efforts to do everything imaginable to keep their establishments up and running. Yesterday afternoon I watched in dismay as a local foreign proprietor ( 60 something in age ) who has worked himself to the bone ran screaming in hysteria across his property ! Another establishment has just advertised its 5th new proprietor in the last 5 years and several others are also advertising new proprietors in equally rapid sucession. In every one of these all too true scenarios these people had no prior experience in the business and that combined with the often shocking and disturbing peculiarities of doing business in Costa Rica has been the last financial and emotional straw for them. I don't wish to discourage you but I do wish to forewarn you that this is not the kind of business that will afford any leisure time at all or peace of mind.

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Pam wrote.."....Please bear in mind that substantial experience as a guest is the equivalent of no experience as an owner/operator in this ( or any ) business."....

 

I think this is a generalization that does not cover all situations. I have stayed at many small hotels and cabinas and with a stay of more than a few days, you most certainly can get an idea of how the place is running. But you have to look for it. You have to be very observant of all things.

 

I have worked with a local ecolodge where I live and when I stay somewhere else in Costa Rica, I am always looking for these kinds of things or other things that might improve their service. (Or make me feel a little smug that "my place" is run better! shame on me.)

 

You can gauge - employees, how they act/react; how happy/unhappy, how many employees per size of hotel, etc How do the grounds look - excellent garden full of a variety of plants and flowers or just well kept. Who takes care of the grounds. How many hours to employees work. Perhaps the boss will give you an idea of what they are paid - including all benefits. Do they eat a free shift meal or do they pay for it.

 

Does the decor seem to make sense or just slapped together. What is it like - mostly hotel plastic or warm Costa Rican woods. You can see what the kitchen is like, based on what meals they prepare. (Most do breakfasts, of course.) Obviously, you can take a peek at the rooms and see if they are in good repair with newish linens, etc.

 

You can see what kinds of information they acquire and make available to clients. Do they have good relationships with guides, taxi drivers, etc. You can ask around town about the place and read between the lines. (Assumes some Spanish.) You can talk to other guests and get their feedback.

 

I doubt that anyone will just open their books to you but if you become friendly with the owner, you can often go to the bakery and get some goodies and invite the owner to have coffee with you and just start with your ideas and get some feedback. Or ask the owner out to lunch or dinner for a one-hour "vacation."

 

Of course we are not talking about Hampton Inn kinds of places - just the small hostel/hotel/cabinas kind of thing.

 

You can look at Trip Advisor for reviews of various small hotels and cabinas and then compare what you find to the reaction of the people who stayed there. It goes on and on..... It's called "research."

Edited by eleanorcr

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Pam wrote.."....Please bear in mind that substantial experience as a guest is the equivalent of no experience as an owner/operator in this ( or any ) business."....

 

I think this is a generalization that does not cover all situations. I have stayed at many small hotels and cabinas and with a stay of more than a few days, you most certainly can get an idea of how the place is running. But you have to look for it. You have to be very observant of all things.

 

I have worked with a local ecolodge where I live and when I stay somewhere else in Costa Rica, I am always looking for these kinds of things or other things that might improve their service. (Or make me feel a little smug that "my place" is run better! shame on me.)

 

You can gauge - employees, how they act/react; how happy/unhappy, how many employees per size of hotel, etc How do the grounds look - excellent garden full of a variety of plants and flowers or just well kept. Who takes care of the grounds. How many hours to employees work. Perhaps the boss will give you an idea of what they are paid - including all benefits. Do they eat a free shift meal or do they pay for it.

 

Does the decor seem to make sense or just slapped together. What is it like - mostly hotel plastic or warm Costa Rican woods. You can see what the kitchen is like, based on what meals they prepare. (Most do breakfasts, of course.) Obviously, you can take a peek at the rooms and see if they are in good repair with newish linens, etc.

 

You can see what kinds of information they acquire and make available to clients. Do they have good relationships with guides, taxi drivers, etc. You can ask around town about the place and read between the lines. (Assumes some Spanish.) You can talk to other guests and get their feedback.

 

I doubt that anyone will just open their books to you but if you become friendly with the owner, you can often go to the bakery and get some goodies and invite the owner to have coffee with you and just start with your ideas and get some feedback. Or ask the owner out to lunch or dinner for a one-hour "vacation."

 

Of course we are not talking about Hampton Inn kinds of places - just the small hostel/hotel/cabinas kind of thing.

 

You can look at Trip Advisor for reviews of various small hotels and cabinas and then compare what you find to the reaction of the people who stayed there. It goes on and on..... It's called "research."

Eleanor , I agree that one can deduce a number of flaws or attributes of an establishment by sharp observation. I do it all the time. Sometimes these are simply a reflection of the proprietor's ambition or lack thereof but in the tourist oriented community where I live and I'm acquanted with many proprietors the existing problems that you observe have often occurred due to reasons beyond their control and that entail an accumulation of hurdles that have impeded their success in maintaining optimal appearances and service. As a local rather than a tourist I see and know about many issues that beset these establishments that the proprietors would prefer not be known to their clientel. Sharing your woes with the clientel is terrible PR and only makes the clientel uncomfortable if not loathe to return to such a depressing environment. If the proprietor is hoping to sell or lease their establishment they'd be foolish to share every grisly detail of their reasons for wanting to leave . Prospective buyers would run ! And this I believe is why so many people fall prey to the seductive dream of running a business in paradise. They have no local knowledge and local sellers aren't about to jeapordize a deal by sharing their knowledge. If however you as a prospective owner/operator have had adequate hands on experience in the business you'll have the advantage of understanding the inevitable problems inherant to the business and you'll likely also be savy enough to deduce that business is conducted very differently here. The best way to learn a business anywhere before you plunge into setting up shop for yourself is to go to work in one and learn it from top to bottom. Then you're better prepared to succeed in surmounting the obstacles in your path.

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Pam, I like your idea of "work before buy". But for just a preliminary "scouting" trip, this may not be possible. Definitely a good idea before making any financial commitment and calling the movers.

 

I don't think lodging owners would be smart to sit down with every customer and pour out their heart. But with someone who has explained that they are thinking of buying a similar business, a quiet chat about various aspects might be in order.

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Gentle Forums Members & IMT,

 

I'll throw in my two cents and suggest that you might like to consider reading this book which touches on many of the problems one could encounter when engaging in such an enterprise.

 

The book is DON'T STOP THE CARNIVAL, by herman Wouk and came out around 1965. It is about one Norman Paperman who decides to leave New York to start running a small hotel in the Caribbean. Pretty much anything and everything that can go wrong goes wrong for him during the course of the narrative.

 

This book is a must for anyone visiting the Caribbean or Central America (& Costa Rica) for that matter. It should serve as an eye-opener for someone who is contemplating doing what IMT is contemplating doing.

 

Apart from that it is a good and funny read. Folks living here already should get more than a few chuckles out of it.

 

The book is still around and there are lots of inexpensive used copies available from Amazon.co, ABEbooks, etc.

 

Regards,

 

Paul M.

==

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I don't think lodging owners would be smart to sit down with every customer and pour out their heart. But with someone who has explained that they are thinking of buying a similar business, a quiet chat about various aspects might be in order.

IMT,

 

There is a group in Costa Rica called the Small Innkeepers Association.

 

They might be worth contacting.

 

They have periodic meetings.

 

HTH

 

Paul M.

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Gentle Forums Members & IMT,

 

I'll throw in my two cents and suggest that you might like to consider reading this book which touches on many of the problems one could encounter when engaging in such an enterprise.

 

The book is DON'T STOP THE CARNIVAL, by herman Wouk and came out around 1965. It is about one Norman Paperman who decides to leave New York to start running a small hotel in the Caribbean. Pretty much anything and everything that can go wrong goes wrong for him during the course of the narrative.

 

This book is a must for anyone visiting the Caribbean or Central America (& Costa Rica) for that matter. It should serve as an eye-opener for someone who is contemplating doing what IMT is contemplating doing.

 

Apart from that it is a good and funny read. Folks living here already should get more than a few chuckles out of it.

 

The book is still around and there are lots of inexpensive used copies available from Amazon.co, ABEbooks, etc.

 

Regards,

 

Paul M.

==

Paul, I'm amused to see that you found " Don't Stop the Carnival " as entertaining and enlightening as I did. I suggested it in an earlier post on this thread. When I worked in the hospitality industry in the Fl. Keys it was on every bookshelf and quoted on a daily basis. I think I'll dig it out of my bookshelf and read it again. Jimmy Buffet actually turned it into a play/musical which was performed in Miami in the 1990's , with Wouk's input of course. I had many hilarious/utterly mind boggling experiences myself in the " carnival " business in the Keys at an island resort where guests were paying $1000 a night plus meals , TV's etc. Little did they know that their French chefs were coming to blows over extension cords to the generator in the kitchen when the power went out as they prepared caviar starters and the strawberries dipped in gold leaf. Or that the toilets were being discreetly flushed by the staff who would sneak down to the beach for water under the cover of darkness when the septic system failed. The Starbucks coffee was often made with water from the pool. These are only a few of my " carnival " experiences.

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