Hotel Maintenance: Four Key Areas That will Increase Property Value

By Fred B. Roedel, III Partner & Managing Member, Roedel Companies, LLC | April 24, 2011

To maximize the return potential of a hotel investment requires a number of factors to come together. They include building a good building in a good market, developing positive free cash flow via strategic operations and last but not least, maintaining the asset.

The current and long-term value of a hotel asset is ultimately a function of its ability to reliably and consistently produce positive free cash flow. As we all know free cash flow is simply a function of revenues and expenses. If a hotel is not well maintained it will not be able to be a market leader in rate and its operating expenses will ultimately increase.

A proactive maintenance program doesn't have to be all encompassing all the time, but is a key element when it comes to maintaining the value of a hotel asset. The four maintenance areas we consistently focus on are:

1. Exterior Envelope

If you are a boater then you know there is nothing worse than a boat that leaks. It takes all the fun out of the experience. The same is absolutely true for any building, including hotels. The damage and issues that can result from moisture are well documented and the costs to correct and fix moisture damage can be daunting. About three years ago we were hired to work on a hotel that had moisture issues in the exterior walls. After a significant amount of time and energy was spent investigating the issue, it was agreed that it could only be corrected by opening up all the exterior wall areas, replacing approximately 50% of the steel studs and installing both a new exterior wall and a new interior wall. Had the hotel been well maintained such actions would have been unnecessary.

When we inspect hotels' envelopes we investigate the following areas:

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Coming up in June 2019...

Sales & Marketing: Selling Experiences

There are innumerable strategies that Hotel Sales and Marketing Directors employ to find, engage and entice guests to their property, and those strategies are constantly evolving. A breakthrough technology, pioneering platform, or even a simple algorithm update can cause new trends to emerge and upend the best laid plans. Sales and marketing departments must remain agile so they can adapt to the ever changing digital landscape. As an example, the popularity of virtual reality is on the rise, as 360 interactive technologies become more mainstream. Chatbots and artificial intelligence are also poised to become the next big things, as they take guest personalization to a whole new level. But one sales and marketing trend that is currently resulting in major benefits for hotels is experiential marketing - the effort to deliver an experience to potential guests. Mainly this is accomplished through the creative use of video and images, and by utilizing what has become known as User Generated Content. By sharing actual personal content (videos and pictures) from satisfied guests who have experienced the delights of a property, prospective guests can more easily imagine themselves having the same experience. Similarly, Hotel Generated Content is equally important. Hotels are more than beds and effective video presentations can tell a compelling story - a story about what makes the hotel appealing and unique. A video walk-through of rooms is essential, as are video tours in different areas of a hotel. The goal is to highlight what makes the property exceptional, but also to show real people having real fun - an experience that prospective guests can have too. The June Hotel Business Review will report on some of these issues and strategies, and examine how some sales and marketing professionals are integrating them into their operations.