Each year, HVS researches and compiles development costs from our database of actual hotel construction budgets. This source provides the basis for our illustrated total development costs per room and per product type.
This summer, as we witnessed the world's top athletes compete in the 2024 Olympics in Paris, there were some profound parallels between pursuing excellence in sports and leading procurement in hospitality. Both domains demand precision, innovation, and a deep commitment to collaboration.
Now that’s a big statement to put out there, but I’m very confident that I’m pretty close to 100% correct with my observations. The reason why I’m so sure is that I know most hoteliers are not financial people and they are oblivious to the issue I am going to explain. On top of that – I see this all the time.
Spanish hotel transactions exceeded €1.6Bn in H1 2024, involving 56 properties and over 8,100 rooms. This is about a 3% increase compared to H1 2023 and 56% above the 5-year average (2019-2023). The Balearics, Barcelona, and Madrid were the most active hotel investment markets, supported by healthy operating results. Elevated investment activity is expected going forward, likely exceeding €3.0Bn by the end of 2024.
With my workshops and speaking, I often do an exercise where I challenge each leader to find a minimum of $250 in next month's forecast. That can be savings in the form of reduced payroll or expenses. It can also be a source of new revenue. The participants come up with some amazing ideas that really work. The great thing about these ideas is that we almost always get to repeat and compound. An idea that works next month just works EVERY month. Read more about creating asset value here.
One of the initial steps when considering a new hotel development is the all-important hotel feasibility study. Or is it the market study? Or should you, the developer, be considering an interim step?
Siloed and fragmented procurement software often complicates the procure-to-pay process. Outdated solutions are typically expensive, inflexible, and inefficient, yet many organisations persist in using these antiquated systems. This reliance on old-fashioned procurement management systems hinders operational efficiency.
Amid a growing travel market and steady inflation, hoteliers are under increased pressure to differentiate themselves from competitors and remain profitable. While room rentals are often considered the greatest source of hotel revenue, your culinary offerings also serve as a valuable opportunity to attract and retain business.
Fort Lauderdale, a staple South Florida beach destination, is shifting its focus beyond leisure tourism with a $1.3-billion investment in the Broward County Convention Center and adjoining Omni Hotel. Following this project, Fort Lauderdale will position itself as both a vacation destination and a commercial city.
Maintaining strong, equitable vendor relationships is key to any successful hotel enterprise, especially during periods of economic uncertainty. When done effectively, these partnerships ensure that hotels can navigate supply disruptions, provide consistent, high-quality amenities, develop unique and competitive offerings for guests, and meet industry standards and regulations. For many hotels, cooperation with suppliers was essential for surviving the pandemic and continues to help set them apart from competitors.
Introduction: At a time when financing for hospitality development projects is challenging for developers, it can often mean that some projects won’t ever come to fruition. At the same time, municipalities would like to increase their hotel or resort offerings to attract travelers to their destinations while remaining fiscally responsible. When developers seek government assistance for development projects, state and local authorities must balance the needs of developers in the community with the financial realities of the project.
“AR” as we commonly refer to the sub department of the accounting function is a mainstay in any larger group-based hotel. In these juggernauts the importance of efficiently collecting your money is mission critical. Not only do we take the chance that the group will come and stay after we hold all those rooms, but we also roll the dice and give them credit.
After spending two days in sessions and the hallways at the 46th annual NYU International Hospitality Industry Investment Conference, I am now less optimistic than I was at the beginning of the conference on Monday morning.
When you think of the most important department in a hotel, accounting may not be the first one that comes to mind for many people. The truth is, however, a hotel or multiproperty hotel organization requires accurate data from its accounting systems to sustain its financial health and run efficiently, and that affects all of the other departments.
Over the last several years, hoteliers have been forced to tackle a variety of emerging challenges head-on, from labour shortages to supply chain disruptions and rapidly evolving guest demands. As travel volumes recover, leading hotels are investing in digital transformation and refreshed amenities for an increasingly experience-driven audience.
Obtaining leverage through debt financing is key to achieving the desired equity return on a hotel acquisition. The reduced availability and prevailing high cost of traditional loans are forcing buyers to be creative and consider alternative strategies to seize an acquisition opportunity. This article presents a few of these alternatives.
Hotel development is a complex undertaking. It requires little of the skills to operate and monetize the asset. Owners and architects are often ill-equipped to measure up the requirements for running a successful hotel a few years down the road. While certain industry trends exist, fundamentals still need to be observed. Words of caution for those attached to specific brands or roles a hotel is meant to fulfill – in today’s world of hyper-efficiencies it is becoming more difficult to provide everything for everyone. Or specifically: provide a comprehensive range of service to all types of travelers. The real estate required to accommodate these service encounters has simply become too expensive to build.
Travel bookings are back. Online sales are expected to account for 76% of total revenue in the travel and tourism sector by 2028, by which time, revenue is set to reach £746.4bn (Statista).
Accommodation providers - from hotels to serviced apartments - need more than just a tech plug-in to succeed in today’s digital-first landscape. As the distribution landscape becomes increasingly fragmented, and guests’ demands and expectations evolve at pace, operators are turning to representation companies to devise and implement wide-reaching commercial strategies.
Over the past couple of months, it has become increasingly clear that interest rates for hotel financing, and just about everything else, may stay higher for longer. As markets adjust to this expectation, many investors are realizing that they may not be able to delay deals until rates drop back down to so-called “normal” levels. There is mounting pressure for financing decisions that will need to be made in the coming months. In this article, we have compiled and analyzed historical hotel interest rate data, as well as indications from the Federal Open Markets Committee (FOMC or “Fed”) on the anticipated direction of future interest rates, to help provide some context for the past, present, and future of the hotel financing market.