Weekly Insights. June 1, 2024

Should Directors of Sales be trained in Revenue Management? 

How to determine a hotel’s feasibility and land value in 60 seconds

Several times a month, I get a call that usually goes like this:

“Hi Steve, Hope you are doing well.  I have a “golden” opportunity to purchase this amazing hotel site in an incredible hotel market.  It's being offered for $10 Million- should I buy it?”

I know they are not looking to retain me for a full-blown hotel market study (at this time)- they just want a “quick and dirty, go or no-go” response.

This is how I can provide them with an answer in just about 60 seconds.

Hotel cap rates: Adjusting to a new reality

A capitalization rate (“cap rate”) is a shorthand expression of a given investment’s return and represents the weighted average return to the debt and equity positions. As detailed in this article, hotel cap rates are higher than they’ve been in recent years and are unlikely to decline anytime soon.

Hotel Revenue Management: What could possibly go wrong?

In this blog post, we will address four challenges in revenue management: incomplete data, the influence of cognitive biases on decision-making, the effects of knowledge and skill gaps, and the issues associated with black-box systems. We will explore the potential risks posed by each challenge and offer practical advice for revenue managers and hotel CEOs to safeguard their financial performance. 

The hotel and short-term rental markets have converged: You can leverage data to bridge the gap

There are clear signs that the hospitality landscape has shifted. You now find yourself in a situation where potential guests are comparing both short-term rental accommodation and hotels before they book.

It’s a transformational change - you have an entirely new competitor, no matter which side of the coin you are on.

The accommodation landscape is taking a similar progression to that of modern day retail that you are all familiar with. How so? Well, let us explain.

What is Experiential Dining? The trend explained for hotel F&B operators

Hotels are adapting to include experiential dining experiences that enhance guest satisfaction and set the stage for a more dynamic, interactive, and memorable dining culture.

How to price buy-outs of smaller hotels in leisure markets

Small properties (one hundred rooms or less), especially upper-upscale and luxury boutique hotels in destination markets that are principally leisure with higher ADRs, are often attractive buy-out destinations for certain kinds of groups. This can range from weddings and reunions to corporate and association retreats or incentive travel.

It is essential to good revenue management that opportunity costs be factored into weekend buyouts because hotels that are in principally leisure segment-dominated locations tend to sell out on many weekends perennially, and because many transient guests staying on weekends are staying 3 or more nights.

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