How We Helped a Multi-Hotel Owner Track Department-Level Profitability

solutions on June 17, 2025

Manage Investor Allocations, and Execute a Complex Gift & Estate Tax Strategy

Owning and operating multiple hotels is far more than just hospitality management—it’s a
financial balancing act involving multiple revenue streams, capital projects, outside investors,
and tax-sensitive ownership structures. When one of our clients, a successful hotel owner with
several properties across two states, approached Solutions Group Accounting Firm (SGAF), they
had operational success but lacked financial clarity.
Each property contained both hotel and restaurant operations, ongoing construction upgrades,
and a mix of investors with varying equity stakes. The complexity of tracking, allocating, and
planning around these elements had outgrown their existing financial systems—and they
needed a partner who could bring structure and strategy to the entire operation.

The Challenge: Disconnected Departmental Financials and Investor Complexity
While each hotel was operationally profitable, the owner had little visibility into which
departments were driving results, and the financial reporting process was slow and error-
prone. On top of that, investor agreements lacked clean reporting on equity allocations,
capital contributions, and profit distributions, creating tension among stakeholders.

Key challenges included:
  • No department-level tracking to evaluate restaurant vs. lodging margins
  • Inconsistent tracking of construction costs and capital improvements
  • Complex investor structures with unclear equity and distribution reporting
  • Delayed monthly close, often pushing past the 20th of the month
  • A major financial gift was being planned for one of the investors, triggering potential gift
    and estate tax liabilities
Our Solution: Hospitality-Specific Accounting, Investor Clarity, and Strategic Tax Planning
SGAF stepped in as the client’s outsourced accounting and tax advisory team, implementing a
tailored solution to support the operational, financial, and ownership needs of a growing
hospitality portfolio.

Department-Level Profitability Tracking
We restructured the client’s QuickBooks Online files and class structure to separately track
revenue and expenses for each in-house department: rooms, restaurant/bar, event space, and
other revenue sources. This allowed the ownership team to identify true margins by
department and make informed staffing and pricing decisions.

Accurate Construction Cost Tracking
For each renovation and upgrade project, we created a capital project ledger to properly
categorize labor, materials, and FF&E costs, allowing for accurate capitalization and depreciation
schedules. These records now roll up into clean, auditable fixed asset records for each property.

Monthly Close by the 15th
SGAF implemented a streamlined monthly close process, ensuring financials for each property
were reconciled and finalized by the 15th of the following month. This allowed the owner and
investors to receive timely reports and confidently manage cash flow, vendor payments, and
investor distributions.

Investor Equity Allocation and Transfer Support
We built a custom equity tracking model that reflected each investor’s contributions,
ownership share, preferred returns, and profit allocations. This model supports regular
distribution schedules, investor reporting, and simplified communication with stakeholders.

Gift and Estate Tax Planning for a High-Value Ownership Transfer
The client was preparing to gift a substantial equity interest in one hotel to an early investor.
SGAF led a comprehensive tax planning engagement, evaluating gift tax exclusions, basis
allocation, and future estate implications. We coordinated with estate attorneys to align the
transfer with long-term wealth planning goals while mitigating immediate tax exposure.

The Result: Financial Clarity, Operational Insight, and Proactive Tax Strategy
As a result of our work, the hotel ownership group now benefits from:
  • Accurate department-level P&L statements for every revenue stream
  • Reliable construction tracking tied to balance sheet capitalization
  • Investor transparency through clear equity modeling and distributions
  • Timely financial reporting by the 15th of each month
  • A thoughtful, well-executed gift and estate tax plan tied to investor goals
  • Greater confidence in financial decisions, budgeting, and investor communication
What was once a set of disconnected hotel operations is now a financially integrated, investor-
ready enterprise with best-in-class accounting and advisory support.

Own or Operate Multiple Hotels or Real Estate Assets? Get the Financial Support You Deserve.
At Solutions Group Accounting Firm, we specialize in helping hospitality owners bring order to
complexity. Whether you’re running a boutique portfolio or scaling to dozens of properties, we
provide:
  • Departmental bookkeeping and monthly financial close
  • Real estate construction and asset tracking
  • Investor equity and tax reporting
  • Advanced tax strategy, including gift and estate planning
  • Full integration of your finance stack and internal processes

Professional hospitality requires professional finance.
Let us help you unlock clarity, profitability, and tax efficiency.

Schedule a Free Hospitality Finance Strategy Session Today