If running a bed-and-breakfast sounds like the best work-from-home business opportunity since sliced quiche, you're in luck: A dozen or...
If running a bed-and-breakfast sounds like the best work-from-home business opportunity since sliced quiche, you’re in luck: A dozen or so bed-and-breakfast inns are on the market around the state, many in the Puget Sound area.
They range in price from $450,000 for The Overlook Lodge, a five-bedroom contemporary lodge on the Lower Columbia River, to $2.9 million for The Hidden Haven in Port Angeles, a cluster of romantic lakefront cottages on the Olympic Peninsula.
While the personal rewards of running a small-scale lodging from home are substantial — the company of a revolving cast of characters hailing from far-flung locations, the chance to display those treasured breakfast recipes, a paying audience eager to enjoy your décor and hospitality skills — the financial rewards are sometimes modest.
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Just ask Don Houghton, a flooring-products manager by day who co-runs Tayberry Cottage Victorian Bed & Breakfast in Puyallup with his wife. The duo took over the B&B from a relative in May 2010 and run it in between working at their day jobs. It’s currently listed for $598,500.
“A B&B was never on my bucket list,” he says. “It’s more of a weekend gig for us.”
Tayberry Cottage brings in about $30,000 per year, according to its listing. It’s not enough to cover the total mortgage on the 4,500-square foot property, he says. Indeed, the mix of inn keeping’s cyclicality and the recession’s impact on his full-time job spurred the Houghtons to list the B&B. Bookings are up by 20 percent so far in 2011, which he attributes to more aggressive Internet marketing, but Houghton is ready for a timeout.
“I’m hyper. I’m gregarious. I like meeting new people,” he says. “But after a few days I’m ready for them to leave, and vice versa, so it all works out.”
For Houghton, socializing with guests — especially those who descend on the area around the time of the 17-day Puyallup Fair — can make the gig fun. Travis Fox, a hypnotist who regularly entertained at the fair, booked the entire inn for several days one year, Houghton says.
One property, two prices
Other innkeepers will sell their properties as a residence, meaning empty, or as an inn, meaning they include furniture and business records (such as guest databases).
Marcia Breece, owner of the Morgan Hill Retreat in Poulsbo, has listed her B&B with John L. Scott for $845,000 — a price that includes everything from furniture to the website, from pre-existing advertising programs to five llamas and 30 chickens — and as a residence for $745,000.
Breece, a former telecom executive, bought the farmhouse property in 2005 as a residence and converted it to a bed-and-breakfast complete with four guest rooms and ornate grounds, including a meditative labyrinth and a cluster of clucking farm animals.
“I thought running a B&B would leave time to write but it didn’t,” she says, noting that between June and October her inn was 70 percent occupied. “Last summer I was up early making breakfast 60 days in a row.”
She’s not complaining, though. When she opened the B&B, she told herself she’d operate it for five years and then re-evaluate. She enjoys interacting with guests, but wants her writing time.
“You have to be a people person for this business,” she says. “You have to read your clients when they walk in the door, whether they want to socialize or have an independent experience.”
Plenty on the market
Peter Scherman, an inn broker and consultant with B&B Team in Scottsville, Va., estimates that there are 1,200 to 1,300 B&Bs on the market nationwide, some of which may revert to primary homes.
The number of bed-and-breakfasts in America has shrunk in the past six years, according to Jay Karen, president and chief executive officer at the Professional Association of Innkeepers International (PAII), a trade association for B&B operators.
The volume of B&Bs spiked in the 1980s and 1990s, and saw some resurgence with the booming economy in the mid-2000s. In 2005, there were 20,000 B&Bs, but that’s fallen 15 to 20 percent, to between 16,000 and 17,000 B&Bs, he says.
The typical owner has been in business for a median of seven years.
“It’s a lot like the restaurant business — people want to give it a try, they have an idea about the business,” he says. “But then the reality is sometimes different.”
B&B occupancy has held steady in the low 40 percent range throughout the recession, however, Karen says, due to travelers sticking closer to home and looking for weekend or short-trip getaways.
While 40 percent may sound low, he says, that’s an average, including B&Bs in rustic areas where the bulk of guests book during one or two seasons or during annual events as well as urban B&Bs which may enjoy year-round guests.
Bed-and-breakfasts account for $3.4 billion of the U.S. economy, according to PAII. This is small compared with the $99 billion American hotel industry, according to Smith Travel Research data.
In West Seattle, the Villa Heidelberg has been on the market since June 2010 and is listed at $1.3 million. The 1909 inn has been run as a B&B for 25 years and has been under the same management for the last 13, according to Steven Henke, the Prudential Northwest Realty agent handling the listing.
In Port Townsend, the 10-bedroom Ravenscroft Inn is for sale for $885,000.
Want to finish converting a late 19th-century saw mill into an 11-bedroom, 8.75-bath B&B? The Wagner Wilson mill site in Monroe is on the market for $1.3 million. Janice English, the Windermere agent representing the property, says that its owners have retired to Arizona and worked on the property’s main structure — with an eye toward B&B operation — for many years while living in a separate accessory unit on the property.
Want a secluded inn accessible only by boat? The Silver Bay Inn in Stehekin, Chelan County, is on the market for $1.6 million.
Like islands? On Whidbey Island, The Blue Goose Inn in Coupeville ($825,000), is available.
The Casa Vista on Vashon Island just reduced its price from $1.195 million to $1.05 million. Originally built as a custom home in 2004, owners John Busch and Osman Person converted the property to a B&B in 2007 at the encouragement of friends and guests.
Busch, a builder, said they’ve listed the B&B because he’s now 60 and wants to retire.
He and Person have run the inn part time, both while working full time elsewhere. He advises prospective B&B buyers to think hard about a property’s location, particularly relative to a major airport, and how much business they’re capable of handling. On Vashon, B&B guests often seek rooms when they’re visiting friends whose homes are too small to accommodate them overnight.
“You have to think about how busy you want to be,” he says. “If you don’t return a phone call from a prospective guest within the hour, 80 percent of the time they’ll have moved on.”
The duo have enjoyed running the Spanish-style property, even if the occasional youngster busts into their personal space, which they’ve cordoned off from the public portion of the B&B via a thick curtain.
“One time this funny little boy stuck his head through the curtains and looked around,” Busch says. “He said: ‘I just have to see what’s back here!’ “
It’s a metaphor, perhaps, for the market opportunity available to aspiring B&B operators.
Jane Hodges is writing a book “Rent Vs. Own” due out next year.