Renovation & Repositioning: Do your homework
By Steven Belmonte CEO, Vimana Franchise Systems LLC | January 12, 2010
No matter what size or type of hotel you own/operate or what market you compete in, your answer most likely is "a lot more than I might be able to in today's competitive climate."
Ironically, few hotel owner/operators think in terms of extra roomnights needed to be sold when weighing the pros and cons of renovating a property and/or reflagging and repositioning it. This is just one reason why so many renovations and reflaggings fail to recoup an adequate return on investment and why capital markets for such projects today often are deemed too risky. These and dozens of other "cancers" are blackening what otherwise undoubtedly would be a much-brighter profitability picture for lodging.
Due diligence means 'do your homework,' which includes many steps along the road to success:
Step 1 is shelving your ego.
Gain strength through surrendering. Admit that you are not "the expert" and that an outside consultant with an unbiased view and proven technical expertise in these matters can save you considerable time, headaches and monies. At Hospitality Solutions, we have a saying: "The road in the U.S. lodging industry can be a difficult but prosperous journey. The shortest route to success is with someone who has led the way."
Step 2 is understanding the two primary scenarios that trigger the need for a renovation.