MONEY IS TOO TIGHT: SECRETS TO SUCCESSFUL HOTEL REFURBS

Posted by GLM on Jul 22, 2015 in Press

GLM Managing Director Ian McKee sat down with Hotel Business Magazine to share his top tips on approaching a hotel transformation with a restricted budget.

Refurbishing any building on a budget is a fraught business with ever present tensions between time, cost and quality – but when the business is a small hotel, the pressure is magnified tenfold.

With many small hotels facing significant operational challenges from staffing to marketing, occupancy to seasonality, the decision to refurbish is a daunting one. How you spend the money really depends on two things: What state is the building fabric and infrastructure in; and how much do you want to change the look and feel of the guest experience?

For most hotel operators the focus will be on the latter – after all, it’s what the guests interact with that creates the return, right? Well yes and no. Focusing all of the budget on interior design, fixtures, fittings and equipment (FF&E), the latest in-room entertainment and a great bar and dining room is all very well but, when the showers are turned on at 7.30 in the morning and only a dribble of lukewarm water comes out, what will the guest’s Trip Advisor comments say?

Hotel infrastructure is not very exciting. Boilers and pumps and unvented hot water cylinders or plate heat exchangers are not very sexy, but getting these things right will make all the difference to the guest experience. Of course, biomass boilers can be quite exciting especially if you can harness the RHI (Renewable Heat Initiative) and enjoy oodles of heating and hot water and get paid to do it!

Then there is the building fabric to consider. Is there any point spending thousands on painting and wall coverings, carpets and furniture if the roof leaks every time it rains? Backlog maintenance issues and plain old ageing has to be addressed sometime, especially if business interruption is to be minimised and the asset value of your building maintained. It is a question of prioritising and finding the optimum balance between fabric, infrastructure and interior design, decoration and FF&E spend.

Whether you can do all this yourself depends on a number of factors. This includes the level of investment you intend to commit, your experience of planning and managing a building refurbishment project, the time scale you plan to do it in, whether you will keep the hotel trading during the work and the information you have to hand to help you decide how to spend your money.

My advice would be take a holistic view of the situation and consider all the factors before deciding how to carve up your budget. Tempting as it may be, don’t jump in to the interior design too early as it’s easy to get carried away and very difficult later on to cut this back to pay for a new roof or boiler. A chartered building surveyor (find one through RICS) will help you plan a complete project by first undertaking a building condition survey of the fabric and services infrastructure.

They will then work with you to identify your business objectives and prioritise what needs to be done to deliver the best outcome in your particular circumstances. This key appointment will help you make and manage other appointments such as designers, architects, engineers and contractors and may often be the only person you need to deliver the perfect outcome.

Ian McKee is a Chartered Building Surveyor, Chairman of RICS Scotland and Managing Director of GLM. He is a leading expert in the master planning and development of leisure and tourism related destinations with a niche in the refurbishment and adaptive reuse of existing buildings.

To see the full article in Hotel Business Magazine, click here.