Buying a hotel in Austria

In Austria you usually buy a hotel before anyone offers it: through advisers with access, against a confidentiality and non-circumvention agreement. On the acquisition of the property you pay 3.5 percent real estate transfer tax and a 1.1 percent registration fee, and in the west you also pay in time for the land transfer authority. From the first conversation to registration, six to twelve months pass.

That is the short answer. The long one starts with a figure buyers regularly underestimate.

Austria counted 157.27 million overnight stays in the 2025 calendar year, according to Statistik Austria the highest figure since digital records began in 1974. Accommodation capacity in the 2024/25 tourism year came to around 1.20 million beds in 73,174 businesses. Hotel investment volume for 2025, by contrast, is put by CBRE Austria at around 550 million EUR.

A million beds, and a transaction market of 550 million EUR. Anyone searching for a house in that ratio while waiting for an offer will be waiting a long time.

The houses you are looking for are in no portal

The reason lies with the seller, not with the market. A hotel is a going concern with staff, a bank, suppliers and distribution partners. An advertisement reaches those four groups first and the buyer last.

That is why the greater part of mid sized houses is offered confidentially or not at all. The mechanism behind it is set out in Why the best hotels never reach the market, and from the seller's side in Selling a hotel in Austria.

For a buyer three routes follow from this, and all three cost preparatory work.

The first is your own network. Tax advisers, house banks, operator groups and architects often know months ahead of the market that a succession is pending in a house. This route is a matter of chance. Anyone relying on it has no sourcing strategy, he has been lucky.

The second is the direct approach. It works, but it is expensive in time and, executed clumsily, burns exactly the address you wanted to reach. An owner who receives an unsolicited offer letter talks about it locally.

The third is the adviser with continuous access to the stock. There it is the prior assessment that counts, not the number of properties. Whoever knows a house also knows the reason it is being given up, and knows whether the owner wants to sell or only wants to hear a price.

In each of these cases the same formality precedes the first document. A confidentiality agreement binds you to the documents and to the fact of the sale, a non-circumvention agreement binds you to the route through the adviser. Anyone who finds that tiresome mistakes its purpose: it is the condition under which an owner releases any figures at all.

In practice that means a buyer makes himself imaginable before he searches. A lodged search profile with size, region, operating structure, price range and financing status is the difference between a call and no call. The database of Sarego Group exists for exactly that, and it is a closed circle: release is manual, only after a signed confidentiality and non-circumvention agreement, and there is no entitlement to access.

Who may buy is decided by the province

Land transfer in Austria is a matter for the provinces. Nine provinces run nine acts, and in the western tourism provinces they are strict.

Tyrol devotes a separate part of its 1996 Land Transfer Act to the subject. Section 12 makes acquisitions by foreigners subject to consent, section 13 sets out the conditions and requires an interest in the acquisition, in particular in economic, cultural or social terms; private interests are to be given appropriate weight. For a hotel business with jobs attached, that economic interest can as a rule be shown. For a second home with a hotel sign on the door it cannot.

More important than the consent itself is the question of who counts as a foreigner at all. Under section 2 Tyrol includes legal entities with their seat abroad and those whose share capital belongs at least half to foreigners. An Austrian company with foreign shareholders can therefore fall under the act even though the commercial register shows a domestic address.

The other direction is in section 3. Nationals of another EU member state or of an EEA contracting state are treated as equal to Austrian citizens. Legal entities from those states are treated as equal where the acquisition is made in exercise of a fundamental freedom, for instance freedom of establishment under article 49 TFEU. A business that you as acquirer actually run, or have run for you, is precisely such a case.

Alongside the foreigner regime a second track runs that affects everyone. Under section 14 Tyrol may declare municipalities with particularly high pressure on the housing market to be reserved municipalities by ordinance, with a declaration duty under section 14a. And among its principles the act expressly names pushing back holiday homes, which it defines by reference to section 13 of the 2022 Tyrolean Spatial Planning Act.

Salzburg brought its 2023 Land Transfer Act into force with effect from 1 March 2023 and combined three subjects in it. The foreigner regime sits in sections 20 to 22, with equal treatment with domestic buyers in section 22. Separately, acquisitions in second home restriction municipalities and second home restriction areas under section 31 of the 2009 Spatial Planning Act fall under a part of their own, whose aim the act states openly: to push back acquisition as a second home or as a pure capital investment.

What Salzburg expressly counts in that context regularly surprises buyers. In relation to second homes, the 2009 Spatial Planning Act brings apartments in accommodation businesses within its concept of a dwelling. Anyone intending to realise individual units of a house separately examines this point before the purchase and not after it.

Vorarlberg turns the matter into a land register block. Section 7 of its Land Transfer Act makes the acquisition of ownership of land by foreigners subject to consent, and section 2 para 2 exempts anyone who, by virtue of treaty obligations, is to be treated like a domestic buyer. Section 28 then requires a final consent, a confirmed declaration or a negative certificate before registration. Without that piece of paper the land register enters nothing.

The remaining provinces run the same pattern in their own wording. Carinthia governs equal treatment in section 7 of its 2002 Land Transfer Act and the consent requirement for foreigners in section 13. Styria treats as equal, in section 4 para 2, foreigners acquiring in exercise of rights under the TFEU or the EEA Agreement, and lists the transactions requiring consent in sections 25 and 26. Vienna too has a Foreign Nationals Land Acquisition Act: section 1 requires consent for the acquisition of ownership by foreigners, and section 3 exempts acquisitions within freedom of movement and freedom of establishment under the EEA Agreement. For a European investor a purchase in the city therefore runs without a procedure as a rule.

For a buyer three things follow. Your own nationality and the structure of the acquiring company belong in the first week, not the last. The competent authority and its timescales are clarified before the letter of intent. And anyone with a change of use for individual units in mind examines the holiday home and second home position before writing it into the calculation.

In Vienna this whole block plays practically no part. What counts there instead is set out in Buying a hotel in Vienna.

On acquisition you pay 3.5 percent, 1.1 percent and 1.2 percent

Where the property itself is bought, the Real Estate Transfer Tax Act 1987 applies. The rate on an acquisition for consideration is 3.5 percent under section 7 GrEStG; the basis of assessment under section 4 GrEStG is in principle the consideration, but at least the property value.

On top of that comes the land register registration fee. Under tariff item 9 of the Court Fees Act it amounts to 1.1 percent of the value of the ownership right to be registered. Where a mortgage is registered for the financing at the same time, a further 1.2 percent falls due.

Worked example. At a purchase price of 12 million EUR that is 420,000 EUR of real estate transfer tax and 132,000 EUR of registration fee. Anyone financing eight million with debt and registering a mortgage for it adds 96,000 EUR. Together 648,000 EUR, before anyone has spoken about contract drafting, technical review, tax advice and legal advice.

These amounts are no footnote, but around five percent of the purchase price. They belong in the yield calculation on the acquisition side.

Completion itself runs through a contract drafter, a lawyer or a notary, who usually also self assesses the real estate transfer tax and handles the purchase price in escrow. For registration, section 31 of the Land Register Act requires a public deed or a private deed with signatures certified by a court or a notary, in the case of natural persons including the date of birth in the certification note. A signature at the kitchen table will not carry the land register.

Since July 2025 the share deal is no longer a shortcut

For years the obvious answer to real estate transfer tax was to buy the company rather than the property and stay below the threshold. That no longer works in the same way.

The text of the act in the RIS carries the change visibly: section 1 para 2a GrEStG was repealed by article 59 no 1, Federal Law Gazette I no 25/2025. Section 1 para 3 GrEStG has since caught changes in the shareholder base from a threshold of 75 instead of 95 percent and within seven instead of five years. New is the concept of the property company in section 4 para 4 GrEStG: where the land belongs to such a company, the rate under section 7 GrEStG is 3.5 percent of the common value. The new version has applied since 1 July 2025.

Whether a hotel business with its own staff and its own cost of goods falls under the concept of a property company is a question of the individual case and belongs with the tax adviser.

For the purchase decision one sentence nonetheless remains that always holds. In a share deal you take on the company together with its past: open tax audits, old proceedings, arrears, liabilities. In an asset deal you take on particular assets and contracts and leave the rest behind. The trade off in detail is set out in Asset deal or share deal. It belongs before the price negotiation, because it changes the price.

What you are actually buying depends on the operating structure

How lease, management agreement, franchise and own operation differ from one another is set out in Lease, management or own operation. For the acquisition decision a narrower question counts: which role you can actually fill after closing.

With a lease you buy a payment, and you buy it from a third party you did not choose. Examine the tenant the way you would examine a debtor: annual accounts, payment history, other houses in the portfolio, dependencies. Remaining term and extension options say how long that examination carries, and the indexation says whether the payment keeps its value.

With a management agreement and in own operation you buy the result itself, which means the bad years too. The decisive question here is one of people: who runs the house on the day after the handover. If the answer used to be the previous owner, who is now stopping, you have bought a gap and should quantify the cost of closing it before you bid.

In practice that means the operating structure helps decide which purchase price is defensible for you. Two buyers can therefore arrive at markedly different prices for the same house without either having miscalculated.

The acquisition review of a hotel has four strands and a fifth

Commercial, legal, tax, technical: that far you examine any commercial property. With a hotel the business comes on top, and that is what makes the difference.

Commercial means three to five years of annual accounts and trial balances, monthly figures with occupancy, average room rate and revenue per available room, plus the origin of the guests and dependence on individual distribution channels. A high portal share is commission and interchangeability in one.

Legal means the land register extract with its encumbrances, easements, the lease or management agreement with every amendment, supply and maintenance contracts, pending proceedings. The most common find is an amendment stating a different remaining term from the sales memorandum.

Tax means structure, open tax audits and, in a share deal, the past of the company.

Technical means building fabric, building services, fire safety, energy certificates and a quantified investment programme for the next five years. Construction requirements in Austria run through the building codes of the provinces, which refer to the guidelines of the Austrian Institute of Construction Engineering; for fire safety these are OIB guideline 2 and its sub-guidelines, among them guideline 2.1 for commercial buildings and guideline 2.3 for buildings with an escape level above 22 metres. There is no separate guideline for accommodation buildings; a hotel falls under the general rules, and which version applies is determined by the relevant provincial building code.

The fifth strand is the business itself, and it breaks down into three questions that follow different rules.

The staff transfer. Under section 3 AVRAG the acquirer enters the existing employment relationships as employer with all rights and obligations, under section 4 AVRAG the collective agreement terms are to be maintained, and under section 6 AVRAG transferor and acquirer are jointly liable for obligations that arose before the transfer. Accrued holiday and severance entitlements are therefore a purchase price item.

The trade licence does not transfer. It is personal; the acquirer registers a hospitality trade of his own and demonstrates the personal requirements and, where required, the qualification under section 111 GewO 1994. Anyone noticing this only after closing is left holding a house he is not allowed to open.

The operating plant permit does transfer, as long as the plant stays what it is. Section 74 GewO ties the permit requirement to the plant, not to the person. Section 81 GewO requires a separate permit for the alteration of a permitted operating plant, to the extent the interests in section 74 para 2 make that necessary. For a buyer with conversion plans this is the decisive point in the timetable, and it is regularly examined too late.

Trade law knows no upper limit on beds. Limits come from building law and provincial spatial planning, meaning zoning, permitted use and the permit position of the particular house. Anyone planning more rooms therefore examines the existing permits rather than a general figure.

A price is built backwards, out of the result

A hotel is a business that generates earnings out of an area. Its value follows the result that this business earns repeatably.

How that figure is arrived at is set out in What a hotel is worth. More interesting for a buyer is what he examines in it, because he is handed it finished.

Three questions do the greater part of that examination. First: which costs has the seller stripped out, and which of them will arise for you anyway. A managing director's salary that was never paid because the owner stood at reception himself is a real payroll item for you. Second: has a reserve for furniture, fixtures and equipment been deducted, and does it carry the actual condition of the rooms. A house whose beds are twelve years old needs more than the customary percentage of turnover. Third: which earnings in the result will not repeat, for instance a one off group booking, an insurance payment or a year with a major event in the city.

In a leased house the examination shifts to the contract. The rent is on paper; the question is for how much longer and who pays it in case of doubt. Added to that is the item buyers most often overlook: the costs that stay with the owner despite the lease, meaning roof and structure, insurance, property tax and, depending on the contract, part of the renewal.

The adjusted result becomes a capitalised value by way of a capitalisation rate. That rate is the buyer's actual statement about the house: it contains the level of interest rates, the location, the operating structure, the remaining term and the question of how easily a successor could be found. CBRE Austria reports a gross initial yield of 5.40 percent for prime hotel properties with a lease in the first quarter of 2025. That describes the top end of the market and is no yardstick for a four star house with 60 rooms and one season.

Worked example. An owner operated house earns 1.4 million EUR of GOP. After deducting a market level managing director's salary of 120,000 EUR and a reserve for furniture of four percent of turnover, meaning 240,000 EUR on 6 million EUR of turnover, 1.04 million EUR remain. At a capitalisation rate of 7 percent that gives around 14.9 million EUR, at 8.5 percent around 12.2 million. The difference of 2.7 million EUR arises purely from a judgement on risk.

That is exactly why a disciplined buyer works in ranges and sensitivities. What happens at five percentage points less occupancy. What happens if the tenant does not extend in four years. What happens if the investment programme falls due two years earlier. The review before the offer belongs in a valuation and feasibility exercise.

The bank finances the business, not the land

A hotel financing differs from a residential or office financing at one point, and that point is fundamental: the security sits in the land register, but the debt service comes out of a business that has to be sold afresh every morning.

There is no publicly verifiable figure for customary equity ratios in Austrian hotel financings. None appears here for that reason. Anyone quoting you one is quoting experience, not a statistic, and that is a difference worth marking in a financial model.

A regulatory ratio does not exist in any case. The ordinance on real estate financing measures for credit institutions, which for years limited loan to value, term and debt service ratios in Austria, applied expressly only to private residential property financings. A hotel loan was never caught by it. The limit is therefore set by the bank, and it sets it case by case.

What is verifiable is the acquisition cost the financing triggers: a 1.2 percent registration fee for the mortgage under tariff item 9 of the Court Fees Act, on top of the 3.5 and 1.1 percent from the acquisition itself.

Also verifiable is the order in which a bank asks. First the sustainable result and its adjustments, then the debt service and the headroom within it, then the operating structure and the remaining term of the contract, then the person who will run the house after the handover. The property comes comparatively late in the conversation.

From that follows a practical rule for the acquisition. The financing request runs in parallel with the review, not after it. A buyer who goes to the bank after due diligence loses four to eight weeks and spends them negotiating against an exclusivity period that keeps running.

Six mistakes buyers in Austria repeat

The search starts with the properties. Anyone searching without a profile gets what is left over. Anyone with size, region, operating structure, price range and financing status in writing gets a call before a house is in the market.

The acquisition structure is settled last. Since 1 July 2025 the choice between asset deal and share deal shifts amounts that no price negotiation recovers. It belongs before the first offer.

Land transfer law is taken for a formality. In Tyrol, Salzburg and Vorarlberg an authority decides before the land register enters anything, and the control structure of the acquiring company decides with it.

The operator agreement is read only in the version in the data room. Amendments change remaining terms, maintenance duties and options. An owner once came with a contract from 2014 and an amendment from 2019 that had deleted the extension option, and both sides had overlooked it in the first conversation.

The investment programme is missing. A house that has renewed no rooms for three years shows a better result and is worth less. Anyone not quantifying that buys the deferred maintenance at the price of a going concern.

The trade licence is treated as part of the object of purchase. It is not. Registration and proof of qualification belong in the timetable before closing.

Six to twelve months until the house is yours

On the buyer's side the sequence is almost always the same.

1. Profile and access. Search profile, evidence of seriousness, confidentiality and non-circumvention agreement. Without this step nothing begins at all.
2. First assessment. Anonymous short overview, then key data: size, category, operating structure, contract with remaining term, three years of figures. One to three weeks.
3. Indicative calculation. Adjusted result, a range rather than a figure, a first financing structure. Two to four weeks.
4. Letter of intent. Price, structure, timetable, exclusivity and the conditions on which it ends.
5. Due diligence. Commercial, legal, tax, technical, plus the business. Six to twelve weeks, longer in a share deal.
6. Financing. In parallel with step five, not after it.
7. Contract and completion. Drafting by a lawyer or notary, certified declaration of consent to registration, escrow handling, self assessment of the real estate transfer tax, priority ranking, registration. Six to twelve weeks.

Anyone needing a consent under provincial land transfer law adds further weeks to step seven. Anyone discovering it only there adds months.

The Austrian hotel market is large in stock and small in movement. That favours the buyer who is prepared and penalises the one who waits for an offer. If you want to know which houses come into question for your profile at all: confidentially, in a conversation. How we support buyers is set out under investment advisory.

Sources

This article reflects the position as at 23 September 2026. It is not tax, legal or investment advice. Every individual case needs review by a tax adviser, a lawyer or a notary.

• Grunderwerbsteuergesetz 1987 (Real Estate Transfer Tax Act), sections 1, 4 and 7, Federal Chancellery RIS, consolidated version 2026. https://www.ris.bka.gv.at/GeltendeFassung.wxe?Abfrage=Bundesnormen&Gesetzesnummer=10004531
• Grunderwerbsteuergesetz 1987, section 1 para 3 and section 7, text of the act with the repeal note on para 2a (article 59 no 1, Federal Law Gazette I no 25/2025), Federal Chancellery RIS, retrieved 23.09.2026. https://www.ris.bka.gv.at/NormDokument.wxe?Abfrage=Bundesnormen&Gesetzesnummer=10004531&Paragraf=1
• Gerichtsgebührengesetz (Court Fees Act), tariff item 9, GGG guidelines, Federal Ministry of Justice, 2026. https://www.justiz.gv.at/service/gebuehren-und-einbringungsrecht/ggg-richtlinien-tp-9.257.de.html
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• Arbeitsvertragsrechts-Anpassungsgesetz AVRAG (Employment Contract Law Adaptation Act), sections 3, 4 and 6, Federal Chancellery RIS, consolidated version 2026. https://www.ris.bka.gv.at/NormDokument.wxe?Abfrage=Bundesnormen&Gesetzesnummer=10008872
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