Asset Management of Full Service Branded Hotel

About the Property:

Full service, 5-star branded hotel centrally located in a major city. The property has three food and beverage outlets, 137 guest’s rooms and suites, 64 parking bays, heated pool and gym facilities.

Despite the property’s excellent location and award-winning loyalty reward program, the property was underperforming its peer group on a RevPAR basis. In addition, there was no strong cost controls in place or a focused strategy to maximize use of hotel’s public spaces to drive incremental revenue.

Our Work:

As the asset manager, we switched the team’s strategy from an ADR (Average Daily Rate) focus to a RevPAR (Revenue Per Available Room) focus. Additionally, the strategy was shifted to concentrate on IBT (Independent Business Travelers) versus leisure travelers. We also worked with the brand to change the General Manager and ensure alignment in both the owner and operator’s strategy.

Key value creation initiatives included:

• Significant EBITDA focus, including monthly asset management meetings with discussions on cost containment, and top line performance. As a result, the compounded annual growth rate for EBIDTA over a five-year period exceeded 24.8% growth.

• Hotel underwent a $2M renovation of the lobby and restructuring of the Food and Beverage Outlets. The hotel will no longer have two small restaurants, but one large restaurant focused on a modern menu. This will ensure a more efficient operation.

• As part of the renovation, the club lounge will be relocated from the meeting level to the mezzanine level, and the current executive lounge will revert to meeting space, giving an opportunity for more growth in the banquet business.