Commercial property: The chance to profit from a sweet-spot deal

A profitable holiday lodge business in a stunning Highland setting has come to the market, offering the opportunity to invest in an interesting commercial property with considerable scope for a lifestyle change and potential to expand.

Drumcroy Lodges, which overlook the picturesque village of Aberfeldy, in Perth and Kinross, enjoy sweeping views over the Strathtay Valley.

The business comprises six lodges, originally built in the 1990s and comprehensively upgraded in recent years. It is for sale through Strutt and Parker for offers over £695,000.

Sign up to our daily newsletter

The i newsletter cut through the noise

Norman and Tina MacGeoch bought the lodges four years ago and spent a year updating them, installing new kitchens, bathrooms and wood burners.

For the MacGeochs, who have a background in developing holiday accommodation, the challenge lay in transforming the lodges while fitting the upgrade around existing bookings. The aim was to extend reservations beyond the traditional holiday season, and much of the refurbishments were made with this in mind.

Tina MacGeoch says: “Aberfeldy and the surrounding area offers so much. The lodges have proved extremely popular with visitors, both during the summer and throughout the winter.”

Euan MacCrimmon, senior associate director at Strutt and Parker, says: “The market for holiday lodge businesses in Scotland is strong at present, with many drawn to the lifestyle opportunities they offer and Drumcroy Lodges has already attracted significant interest.

“The lodges themselves have been beautifully refurbished and they are extremely well-located in a spectacular rural setting.

“They are very close to Dewar’s Aberfeldy Distillery and within walking distance of the town itself.”

This area of Scotland offers an abundance of outdoor activities, such as walking, kayaking and white-water rafting. It is also well located for tourist attractions across the region.

MacCrimmon continues: “Properties like this don’t come up that often in that location, it is a sweet spot in Highland Perthshire, an hour away from Central Scotland and close to the A9, so it is a key position for that type of business.”

For this size of proposition, buyers are more likely to be individuals looking for a lifestyle business, according to MacCrimmon, although the lodges have had interest from an investment group looking to expand its property portfolio.

MacCrimmon observes that the more input a new owner is willing to provide, the better the profits.

“[Drumcroy Lodges] trades all year round, so the books look good. It is a profitable business which would provide a good living for an individual or a family willing to work as an owner-operator.”

The lodges will be sold as a going concern, much like a hotel, so a buyer will have bookings in place, providing an income from day one.

Added to that, there is planning permission in place for a further three lodges, which offers significant scope to develop the business.

A purchaser would also have the option of buying an extra block of land, with planning consent for a residential house and 12 further lodges, by separate negotiation.