While leasehold business purchasers enjoy a much higher return on their investment, the worst case scenario (the business failing) usually means the loss of any money they outlaid for the business.
Deciding on which ownership to choose comes down to your circumstances and your lifestyle.
You don’t have to know everything about running a hotel or motel but you do need a basic understanding of how to run a cash flow business and, of course, a hospitable nature.
With freehold, the land itself retains value even if the business sinks so a couple in later life looking to quiet down and have a lifestyle may look at purchasing just the freehold itself.
A 30 or 40 year old couple looking to reach the peak of their success and take on a new challenge may look at purchasing a business as a leasehold.
There’s a much bigger return on the lease and you can later use it as a platform to leapfrog into building your portfolio which may in the future include freeholds.
At the end of the day, bricks and mortar don’t produce dollars: businesses do.