Investing in hotel real-estate requires a lot of funds. We are talking about tens or hundreds of millions of dollars/euros. You need to ensure a proper ROI is generated with such a strategic investment. Moreover hotels are a multi-million dollar operation. In any other industry we would be looking for a well experienced CEO to manage such a company. Who would you trust to manage your hotel investment?
Banks and governments might be struggling, but travel is surely on the rise in Europe. Regardless of the economical struggles in the financial market over the last few months, the European hotel industry is showing strong signals and results. Xotels reports 9,8% RevPar growth in Q2 for its independent hotel portfolio. And heading into the summer months the promising performance continues to hold.
I just have to get this of my chest, and share my latest experiences with you. I love it how many hoteliers complain about the fact that OTA are penetrating their hotel too far and are almost controlling their business. And not to forget the rants we hear about the ARR being too low. But sometimes we have to look at ourselves instead of blaming others. Some hotels just have to get their revenue management strategy in order, more than anything else.
The pre-opening phase of a new hotel is both a big challenge and a great opportunity at the same time. We are currently going through and preparing for the opening of new hotels in various destinations throughout Europe, and are working hard to avoid common mistakes made in this process. We have listed some of our hotel pre-opening tips below.
Does this type of revenue management conversation sound familiar?
GM : 'Thank you for showing us the numbers, but I really believe we have to hold the rates.'
RM : 'But the trend show we are behind in our business on the books.'
GM : 'Trust me, I have experience. I know this city, these rates will sell, we will do fine.'
RM : 'But ...'
GM : 'That is my final decision. Let’s move on.'