From International Development to Bed and Breakfast Owner: One Woman's Journey to Entrepreneurship

A Career Change into Hospitality

Christine Trailer made a dramatic career pivot when she purchased Swan House, a bed and breakfast in Washington DC's Dupont Circle neighborhood. After 15 years working in international development, Christine was ready for a change. She wanted to run her own business and be the "master of her own ship."

While hospitality was a new field for her, Christine felt her operational and finance skills from managing large international development projects would translate well to running a business. She was also known among friends and colleagues for being a naturally hospitable person.

Finding the Right Opportunity

Christine had always dreamed of owning a bed and breakfast, but the right opportunity hadn't presented itself until about a year ago. She started her search by reaching out about Swan House, a B&B where her brother and sister-in-law had previously stayed.

Through a connection, Christine was able to get in touch with Swan House's owners, who happened to be looking to sell. The timing was fortuitous, as the property had only briefly been on the market previously.

The Property

Swan House is an impressive Victorian mansion built in 1883. Some key details about the property:

• 10,000 square feet
• 10 guest rooms, each with private bathrooms
• 2-bedroom innkeeper's apartment
• Outdoor area with pool
• Large common areas including dining room, parlor, study
• One of the only freestanding buildings in Dupont Circle

The house was built by Walter Paris, a prominent architect and builder in DC at the time. While he built it for his family, they never actually lived there. The property's historic nature and prime location make it a unique asset.

The Business

Christine provided some insights into the financials and operations of Swan House:

• Conservative Year 1 revenue estimate: Just over $1 million
• Projected NOI (not including loan payments): $700,000
• Christine's salary as innkeeper: $60,000
• 4 employees: Christine full-time, part-time assistant innkeeper, full-time housekeeper, part-time assistant housekeeper

While the $60,000 salary is below what Christine was making previously, many of her living expenses are now covered by the business since she lives on-site. She expects profitability to grow significantly over the next 5 years.

The Acquisition

Putting together the deal to purchase Swan House was complex, especially as a first-time business buyer. The key components were:

• $5 million SBA 7(a) loan
• $779,000 conventional loan from same bank
• Seller financing
• Personal cash contribution in the hundreds of thousands

Total purchase price was around $7.5 million for the real estate and business. Christine noted this was primarily a real estate purchase with a business attached that enables paying down the loan.

The SBA loan process ended up taking 8 months, much longer than expected. This created stress with the seller and required Christine to put up additional funds to extend the purchase agreement multiple times.

Lifestyle Change

Running Swan House is a major lifestyle change for Christine and her family:

• She works 11 hour days, 7 days a week
• Her husband and two young children live with her in the small innkeeper's apartment
• The kids have had to adjust to always being mindful of guests
• Christine has little time off, though friends have offered to help for vacations

Despite the long hours, Christine finds the work rewarding. She enjoys the variety each day brings and the relationships formed with guests.

Business Strategy

Christine sees several opportunities to grow the business:

• Rebuilding the customer base after renovations and ownership change
• Gradually increasing rates as reputation improves
• Targeting high-end clientele looking for personalized service
• Hosting events and integrating with the neighborhood

She aims to grow profitability to $250,000-$300,000 annually within 5 years, while paying herself a higher salary.

Challenges in the B&B Industry

Christine offered her perspective on why bed and breakfasts are often seen as difficult businesses:

• Many owners treat it as a retirement hobby rather than a true business
• Lack of focus on growth and delivering exceptional experiences
• Competition from hotels and Airbnb

She believes her entrepreneurial mindset and commitment to hospitality will help Swan House succeed where others struggle.

Advice for Aspiring B&B Owners

For others considering buying a bed and breakfast, Christine emphasized:

• Be prepared for a steep learning curve on business acquisitions
• SBA loans can enable deals but also cause major delays
• Understand both the real estate and business components
• Have a clear vision for growing the business, not just maintaining it

Looking Ahead

While the work is demanding, Christine is excited about Swan House's potential. By her early 50s, she hopes to own a valuable piece of DC real estate outright while operating a thriving hospitality business.

For Christine, becoming a bed and breakfast owner has allowed her to be the master of her own destiny while building real wealth. Though the transition from international development was dramatic, she's found the entrepreneurial challenge rewarding.

Those interested in learning more about Swan House can visit their website or Instagram @SwanHouseBB. Christine welcomes connections from others in the hospitality industry or aspiring B&B owners.

Article created from: https://www.youtube.com/watch?v=9QgcY2PWXZM