Should I Extend My B&B to Add More Bedrooms?
Whether or not to extend a B&B to put more bedrooms in is a tricky question at the best of times. It's even harder in a time of economic uncertainty, particularly when banks and building societies are reluctant to lend and property values aren't rising as fast as they were, if at all.
Check With Planning FirstThe question is essentially a financial one although there are other business considerations too. The first thing to do is approach the local planning department for an informal conversation about whether they would look kindly on any development. If the answer is 'no' then the question is answered for you.
Assuming you get a positive response from planning, it's then time to weigh up the investment of extending the property against the extra profit it might generate. That's going to take time. Even if you cut the work to the bone and do much of it yourself you're unlikely to get away with any change from about £20,000 for adding a couple of new bedrooms. You'll need a lot of summers for the profit on the rooms alone to repay that.
Assess the Business ImpactThere are wider financial considerations though. The extra bedrooms will put value on the property as a whole, from a pure house value point of view. Then they will add value to the business, as a separate issue. If your exit strategy is to sell the B&B when you no longer fancy running it, then you'll get a better return at that point, as long as the business is running successfully.
Then there is the impact on the business to consider. If you extend would the extra bedrooms put you in a different price bracket? Would it give you more flexibility and allow you to tackle a different B&B market, perhaps families or active sportspeople?
Timing Building WorkYou need to consider when to do the extension work too. Remember that the spring and summer are the best times to get building work done, but they are likely to be the best times for your business too. Don't forget the add-on time, cost and disturbance of decorating other parts of the B&B to match the new extension.
Can you build the extension in the autumn and early winter if the weather turns bad? Or do you do the work in the summer and simply accept the hit on the business? People who have their rest and relaxation disturbed by building work will not be happy customers. And in these days of the internet, dissatisfaction can spread faster than measles.