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Surviving a Hotel Renovation

Here's how to maintain a healthy business while overhauling it.

Monday, October 06, 2008
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Gemstone Hotels and Resorts, LLC

Hotel renovation. These mere words can send chills up the spines of hotel general managers and property owners.

Embarking on a major renovation of public spaces and guest rooms can be potentially very disruptive to business. But, once a hotel starts to show its age – or ideally before that – it is essential that you refurbish to keep your property looking fresh and vibrant.

Generally, renovations are done either to keep your hotel up-to-date or to bring in new business with a more major overhaul. For the first kind of renovation, you should have an FF&E reserve established at your hotel and this would ideally be funded monthly – to be used to keep your hotel looking clean, bright, and modern. The second kind of renovation – an ROI renovation - is used to create new revenue sources or to capture new customers by adding or more drastically changing something major at your property.

You need to renovate smartly and with a lot of short- and long-term planning prior to starting any major project in your hotel. Here are some tips, from years of experience, to help you survive and even thrive during a facelift:

If you can afford to renovate all parts of your hotel all at once, that is better. It is not as helpful to have tired guest rooms and a new lobby/restaurant. However, if you have capital constraints, you would need to renovate in stages.

Start with the portion of your hotel that is in dire need of a refurbishment. If your guest rooms are very worn out – with torn carpeting and ragged curtains and are a real eyesore – go with those first. If your lobby is falling apart, concentrate the first part of your renovation on this section of your hotel.

However, if no one area stands out as needing a renovation much more than another area, examine the positioning of your hotel, what kind of business you compete for, and where you make your money from on a regular basis. For instance, if meetings business brings you the most revenue, focus on updating your meeting space. Or, if weekend leisure business is driving your customer base, you’d want the latest and greatest in spa design and services and start your renovations there. On the other hand, if your restaurant brings in a lot of business, but needs a facelift, this may be the section of your property that you’d want to renovate first.

Perhaps you are looking to renovate to bring in a new customer base, which is the ROI renovation discussed earlier. Examine what you are lacking in your hotel. What services or amenities could you add, expand or upgrade to give you an advantage toward gaining new customers?

For instance, if your research indicates there is strong local catering demand in your immediate market and you’d like to capture some of this business, renovate your meeting and ballroom space and totally jazz up your catering menu. If your research suggests that a big upgrade in guest room technology will help with tech travelers, survey what the hotels that are capturing these travelers are offering and go one step further to offer something bigger and better when you refurbish your guest rooms. You’d want your renovations to give your guests a totally new and exciting experience.

Use discretion in telling your guests in advance about any kind of renovation, unless it will directly impact their stay. Once they are at your hotel, do something special for them. If there are noise and jackhammers around your lobby, offer guests a free drink at the temporary front desk that you have established.

Be smart about excess noise. Minimize any noise when guests are in meetings or trying to sleep. Try to maintain a buffer floor between the floors where there will be construction. For instance, if you are redoing floors 14 and 15, don’t put guests in rooms on the 12th floor. That will be your buffer zone. Also, don’t put guests in rooms that are adjacent to a construction area or where there is excess noise or dirt/dust. And, if guests are in a meeting on one side of your hotel, concentrate on completing renovations on other side of the property.

Be sure to hold weekly meetings between the contractor and the hotel to discuss where the noise and potential disruptions will be during the coming weeks. Always communicate with your employees, to let them know what is going on in the hotel at any point during a renovation. This way, they can keep guests as comfortable and as informed as possible.

It is always best to have as much of a renovation take place during slower times of the year. You don’t want to interrupt wedding season – if you do a lot of wedding business. And, you want minimal disruption as well during peak meeting times of the year, if a lot of meetings and conferences are held at your hotel.

Ideally, you don’t want to have to close down your hotel. You will lose business, and you have the employee issue to deal with. Plan wisely and you should be able to remain open.

Let the world know about your renovations! It doesn’t do you any good to spend time and effort on a refurbishment if you don’t take the time to publicize it and generate additional business and traffic to your hotel.

Take out ads in local newspapers and magazines. Offer food and drink promotions, if you have a new restaurant. Do the same with your spa. Send out renovation announcement flyers to local businesses, if your property generates traffic from the locals. Invite local business leaders to receptions, to sample your hotel. Offer special room night packages to celebrate your hotel’s new look and feel.

If you don’t have a public relations director on staff or work regularly with a local agency, consider contracting with a PR firm for a three- to six-month period to generate publicity. Send out press releases, invite local food critics to chef’s tastings, and invite the local press to tour your newly renovated hotel.

By utilizing these ideas, you can survive a hotel renovation with as minimal amount of disruption as possible to your guests and a minimal loss in any revenues to your bottom line. And, you will wind up in the end with a refurbished, refreshed property that will entice your guests to come back again and again.

Hotel industry veteran Mark van Hartesvelt is a principal with Gemstone Hotels & Resorts, LLC, a five-star management company based in Park City, Utah. His guest column appears monthly in Hotel Interactive®.
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