Abstract: The hospitality industry plays a key role in sustaining the livelihoods of approximately 1.3 million Kenyans living in Mombasa where the hotel businesses serve as a source of employment and income generation for the residents. However, majority of the hotels have adopted family business model, with the hotels being run by family members rather than professional managers. This approach limits the hotels performance and hence a threat to their sustainability. This study sought to establish how strategic planning affects the sustainability of the family owned hotel businesses. The objectives were to examine the leadership style, to find out the roles of strategy formulation, strategy implementation and organizational structure in the sustainability of the hotel businesses. Findings from the study show that strategic planning if done effectively will ensure the sustainability of the family owned hotel businesses.