Founder's Story
Unbranded to Unforgettable: How Korosh Farazad Reinvents Hospitality | Ep 210 with Korosh Farazad Founder of Farazad Advisory
Fri, 2 May 2025
Korosh Farazad traded a UK law career for two decades of pioneering structured finance in hospitality real estate. Today, his Farazad Advisory specializes in value-add hotel acquisitions—85–200 rooms, no global brands, 3–5-year hold—in gateway cities across North America and Western Europe. From SLS Dubai to a sudden Swiss relocation, Korosh reveals the deal architecture, market pivots, and hard-won lessons behind his boutique empire.Key Discussion Points:The Spark: How a people-person’s obsession with behind-the-scenes hotel value drove Korosh from courtroom to keys.Deal DNA: Why only sub-200-room, unbranded hotels qualify, and how minority stakes plus franchise tie-ins deliver 1.8–3× returns.“SLS Dubai” Benchmark: The guest-experience blueprint that turns check-in into a 24-hour mousetrap of F&B and nightlife options.Market Pivot: Exiting a cooling UK scene, relocating to Switzerland in five weeks, and sealing first Swiss deals in record time.Architects of Upside: Balancing debt-serviceability and in-house expertise to self-power roll-off trucks, paving rigs, and franchise roll-outs.Failure → Fuel: Why every crash taught him more than success, and how relentless iteration builds the confident dealmaker.Key Takeaways:Start Small, Crawl First: Deeply master every back-and-front-of-house nuance before running.Value-Add Over Core: Seek the “unfinished canvas” hotels that reward hands-on branding and operational revamps.Crystal-Clear Criteria: 85–200 rooms • no legacy brand • three-to-five-year hold • gateway city tourist flow.Speed to Market: Quick pivots (e.g., Switzerland in five weeks) beat protracted, high-cost transformations.Closing Thoughts:Korosh Farazad’s journey reminds us that hospitality deals aren’t hotel-chain clones but stories begging to be rewritten. Tune in to discover how structured finance, guest-obsessed engineering, and bold market moves can redefine real estate success—one boutique acquisition at a time.Our Sponsors:* Check out Indeed: https://indeed.com/FOUNDERSSTORY* Check out Northwest Registered Agent and use my code FOUNDERS for a great deal: https://northwestregisteredagent.com* Check out Plus500: https://plus500.com* Check out Rosetta Stone and use my code TODAY for a great deal: https://www.rosettastone.com
Chapter 1: Who is Korosh Farazad and what is his background in hospitality real estate?
Hey everyone, welcome back to Founders Story. Today we have Karosh Farizad, the Managing Director of Farizad Advisory. And we're going to talk through all things real estate, hospitality, investments. I know you're in Europe, North America, Asia Pacific. You are a veteran in structure, financing, engineering, technology. challenging structures within real estate transactions.
We're going to go into all these things. I'm very interested to hear the state of how everything is. I know you recently moved to Switzerland. We can talk through that too. But first though, I'd love to understand what was the spark around your obsession with hospitality and real estate? And was it a specific moment that influenced you?
That's actually a very good question. I've always been involved. I've always had a passion for real estate, but I've always had even more of a passion for hospitality. Seeing different hotels, I mean, I travel a lot, but prior to getting engaged with the hospitality arena and on the real estate side, I just had this passion that...
Chapter 2: What sparked Korosh's passion for combining real estate with hospitality?
Putting real estate and hospitality into one sentence just sparked my attention. One of the elements was there's a lot of work that goes behind the scenes to create a value of a hotel. And that's really what that drove me into getting involved in the business and more specifically investing. Being in the hospitality industry, you have to be hospitable, so to speak.
So that was also another drive because I'm a people's person, or at least I think I'm a people's person. And it carried weight for me to explore the idea and tap into it. And I tapped into it about almost two decades ago.
Hey, well, that's nice. If you're into hospitality, you can travel around the world and going to all these amazing hotels is really, you know, information you need. So you're kind of working and having fun at the same time when it comes to hotels and hospitality. When you look at what you want to invest in. Are there certain things that you're looking for?
Yes, 100%. First of all, we look for opportunities that are value-add and upside. We don't look for core assets. And what that means in plain, simple English is any hotel that is just brand new and is already stabilized, it's not for us. We look for hotels that don't have a brand on it, like your Marriott's, your Accor's, your Hilton's, so on and so forth.
We go in, we look at the opportunity, we see how we can revamp the opportunity by bringing in a franchise operator. We don't deal with long-term relationships like hotel management agreements.
We look for 10-year operators or 10-year franchises implementing food and beverage concepts that correlates with that hotel, with that region, and gives options for the guests to have a variety when they come in to experience the hotel. And then we keep it for about minimum three to five years is our objective, and mostly gateway cities in Western Europe.
We do case-by-case other destinations, but it's really the gateway cities where there's a high penetration of inward tourists.
So let's say you have some hotel owners out there who are like, I would love to be involved in this. I would love to get either an investment or roll up or however you would structure it. What would you say to these owners as to something that you're looking for? Do they need a certain amount of locations? Does it need to be a certain amount of rooms?
Are there certain metrics that you're looking at?
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Chapter 3: What are Korosh Farazad's investment criteria for hotels?
Very good question again. Yes, we look for at least a minimum of 85 rooms and above. Maximum is 200 because anything above 200 becomes a room factory, as we call it. It's just you're not going to be able to get that relationship, the hospitality experience. Of course, the larger hotels can, but we're not those large groups. We are more smaller and we're leaner and we care for the assets.
And therefore, what our objective is, if a hotelier, a current owner says, listen, I don't have the bandwidth to do what you guys do. OK, we don't go and purchase the hotel 100 percent outright. We give a minority stake. as our local sponsor, unless we have other local sponsors within the parameters of that hotel or within that region, I should say.
And if it makes sense, then we keep them on board for, let's say, 20 or 30% of the ask price. So for example, if a hotel is, for the sake of this conversation, if it's $10 million, we say, okay, we will pay you $8 million Two million, we won't pay you, and the 20% remains yours, but then you get the upside of it. What is that upside?
It's post-stabilization and the value add, the elements that I've already described by re-revisioning the food and beverage concept, putting a brand in there, putting it into a reservation motor or engine. Then what happens is that you automatically generated a good revenue post the investment. And that could range from subject to jurisdictions.
It can go from anywhere from 1.8% to 3% or 3x of your money. So that's a pretty good return if you think about it. Is it always like that? No, it's not always like that. We try to be very...
very, very conservative with our numbers, but achieve the end results and to make sure that not only we're satisfied, but the exit buyer that's going to purchase that hotel from us is satisfied, knowing the fact that they're getting something that can run for at least a decade post us selling it to them.
Being in the hospitality industry previously myself, I can relate to the fact that many of these companies, they don't stay up with technological trends or like you said, building a brand, marketing. There's a lot of things that they don't do. I know a lot of people that say, I want to just open up a hotel, but don't realize how hard it is and how much work goes into it.
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Chapter 4: How does Korosh structure hotel deals and partnerships with owners?
So if you were to look at the perfect hotel that you visit, what are you looking for or maybe even an example of a hotel that really wows you?
Customer experience or guest experience is the most important thing. The moment the guest enters to check in, that's when you've caught the guest's attention. If you let that guest go, check in and then go out to have their cocktails or to have their snacks, you've lost that guest. That's the way I look at it. So technically it's like a mousetrap formula.
Once your guest enters your premises, you have to hold them there for 24 hours. By doing that, Meaning you have to have options for them. So options means what type of all-day dining is your hotel providing? What type of a signature restaurant that correlates with the brand, that correlates with the region and the story within that hotel? is providing.
And on top of that, you have the nightcap, you know, every, every restaurant, every hotel must have a decent bar. Okay. Because these are revenue generators. You can't just rely on the rev par and the ADR in your occupancy. You also have to rely on what other revenue generators or models you've implemented in the hotel.
and, and to, to answer your other question with regards, what experience have I seen? One of the best experiences I've had goes to the SLS Dubai event. From the moment, and this hotel was built several years ago, and it's magnificent. From the moment you enter the hotel, you have options. And the customer care, it's just mind-blowing.
Of course, everyone says, well, Dubai has the best service all around the world. It's like Singapore, blah, blah, blah. Yes, it does, but... Customer attention is important. Just by providing a service and not attention to detail is not the same thing. And this is where SLS will probably be one of those hotels that I really enjoyed. And, you know, it has my heart.
Of course, there are other hotels that I could think of, but that one, yeah, that captivated me to use that as their first brand.
It's amazing how when you think of a trip, I don't really remember much about that trip, but I always remember the hotel. I see so many castles or churches or sites that to me, they all start to feel the same. But I really, really pay attention, like what you're saying. And if the experience of the hotel is great, then I tell people to go back to that city. It's not even just about the hotel.
Sometimes it's like the whole city is represented by the hotel. I'm curious about your experiences just in business in general. Was there ever a time where you said, you know what, I'm just going to give up? Or maybe a challenge that was just so big, but you were able to solve it?
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Chapter 5: What defines a successful guest experience in boutique hotels?
There is a lot of truth in it. I mean, we still have offices in London. So it's a rep office now because most of our people have been relocated and actually to Switzerland. We still have a few more people there, which the relocation process is going to take place. But going back to your initial question, you're not hearing false information.
when you're physically on the ground and now when I go back, I see what's going on on the ground and I'm like, oh my God, I used to be one of them. Everyone's just miserable and I feel really bad for them. I was one of those people. I would go to work like, you know, You know, another day at the office, you know, you're just kind of freaking out because you don't know where this is going.
So it is a it is a unfortunately as as charming as London is and as always will be a charming city. It's just going through a process and it just needs a little bit of tender, loving care. TLC.
Yeah, we were just in Switzerland and a friend of mine, he had moved to Zug and he was like, I love it here. My kids walk to school and it's super safe and it's amazing. And we went around the lake and I was like, this is a beautiful, an absolute beautiful place to live. Probably the most expensive place I've ever been on vacation. It was pretty, Zurich was quite, it was quite expensive, but
Great experience with hospitality. People were amazing. I'm curious, though, my last question to you is around inspiration. So if somebody comes to you and they say, look, I'm not maybe I haven't started my hotel or restaurant or I don't have the real estate for you to invest in yet, but I want to get there. I want to get to a place where you see us as something I'm just starting out.
What advice would you give to them?
Start small and believe in what you're doing. That's really what I can say. Just start small. It's, you know, a baby doesn't start doing, you know, marathons from the day they're born. They have to crawl first and then walk and then start walking.
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Chapter 6: What is the significance of the SLS Dubai in Korosh’s hospitality approach?
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Chapter 7: How have failures shaped Korosh’s business philosophy and growth?
They're welcome to send me an email. And they can contact FarazadAdvisory.com. One word.
Amazing. Well, this has been great. I'm super inspired. Maybe one day I'm going to create that hotel and then we can chat about it. You never know.
Always welcome to my man.
I'll see you out in Switzerland at some time, but I really enjoyed it today and congrats on the move, all the success. I can't wait to hear from a year from now, how just amazing all the things are that you're working on. And thank you so much for joining us today on Founders Story.
Thank you very much, my man. I appreciate you.
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Chapter 8: Why did Korosh pivot his business to Switzerland and what does it signify?
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