Location: Five Crucial Points to Address When Selecting a Hotel Location

By Fred B. Roedel, III Partner & Managing Member, Roedel Companies, LLC | February 19, 2012

This is a fun topic at a time when few if any parties have actually been seeking new locations. But as the economy improves and the hospitality industry begins to see some light at the end of the tunnel, it is nice to think investors and operators are actually talking acquisition and growth again. There is the old saying that the key to successful real estate investing is 'location, location, location.' This statement has stood the test of time, but the areas we investigate within a location are what really make a difference in our investments and their ultimate success. The five areas our firm focuses on when reviewing new locations are; the basic market, the physical site, the competitive set, demand and brand availability.

Marketplace

One of the first areas to evaluate is the make-up of the current market. We look at all kinds of markets within our strategic targeted growth areas and ask the following basic questions:

  • Is there an opportunity due to lack of supply?
  • Is the current supply of hotels newer construction or older, and if older, how old are they?
  • What is the makeup of the existing hotels, is there a potential opportunity with a brand or a particular segment within a brand?
  • Is the market a mature marketplace with a track record of success, a developing market or a new and developing market?
  • What do we think the barriers to entry for future development are?:
    < high real estate prices
    < difficult zoning
    < architectural review standards
    < abutters
    < historically difficult approval process

Our company took advantage of a situation like this approximately 6 years ago. We identified a location in an aging stagnant market. Our evaluation indicated that the age and condition of the existing supply provided a key opportunity. In addition there were few raw land sites. We developed a focus-serviced product that has become the number one performing hotel in the market because there were customers that wanted to stay in this particular marketplace but did not consider many of the existing hotels acceptable options.

Location

Choose a Social Network!

The social network you are looking for is not available.

Close

Hotel Newswire Headlines Feed  

Jackson Thilenius
Gino Engels
Jane Segerberg
Stephen Hall
Brenda Fields
Miranda Kitterlin, Ph.D.
Didi Lutz
Peter Anderson
Christopher Bolger
Kevin Wilhelmsen
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.