Hotel Assessments
There are many different types of hotels in Ontario, with a wide range of offerings. These include:
- small budget hotels
- large convention hotels
- luxury hotels
- condominium hotels
How your hotel property is assessed
MPAC primarily uses the income approach to value hotels. The value of an income property such as a hotel is based on the present worth of anticipated future income.
Our assessors use a number of performance metrics to assess a hotel’s value. These metrics include:
- Revenue per available room
- Ratio of room operating costs to room revenues
- Other departmental and operating expense ratios
Where the income approach to valuation is used to value the hotel, the amounts deductible for management fees and for personal property should not exceed 5% and 15% respectively, unless MPAC can demonstrate that another percentage is more appropriate.
To learn more, review the methodology guide.
Condominium hotel units
Condominium units are sometimes used as hotel units. You must sign and submit a condominium statutory declaration form if you are changing the use of your condominium unit from:
- a regular long-term rental or owner occupation to a hotel unit
- a hotel unit to a regular long-term rental or owner-occupied unit
This declaration will state whether a unit will be used as a hotel unit for the upcoming and subsequent tax years or whether it will cease to be a hotel unit.
Your declaration must be made by June 30 of the tax year prior to the year for which you are making the declaration.
Additional information
Current Value of Hotels - section 45.3 of Ontario Regulation 282/98 of the Assessment Act.
Condominium hotels - section 45.3.1(6) of Ontario Regulation 282/98 of the Assessment Act.
Assessment Information Requests
Each year, MPAC collects financial and operating expense information from income generating properties as part of our Property Income and Expense Return, the largest data collection campaign under our Assessment Information Request Program. This annual initiative is crucial to our efforts to maintain accurate property records, deliver quality assessments, and inform changes to Ontario’s property landscape.
For general information about Assessment information requests, visit mpac.ca/AIR. For more information, including submission resources, deadlines and compliance requirements, visit mpac.ca/PIER.
