Marriott builds a hotel for $34 million and sells it to an investment firm for $52 million. Marriott charges the investment firm 2-4% of gross revenues to operate the hotel. This type of
Transaction is known as a:

Question

Quizplus · Accepted Answer

This transaction is known as a management contract, as Marriott is charging the investment firm a fee to operate the hotel. A franchise agreement would involve the investment firm paying Marriott to use its brand name and operating system, while vacation ownership and REITs are different types of real estate investments.

Marriott Builds a Hotel for $34 Million and Sells It