Overdue Hotel Renovations on the Rise!
Posted by Kate / to News, Hospitality, Industry Trends / on January 6, 2012

Grand Image’s un-paralleled history of providing the best imagery available on the market positions us, and in turn you our customer, to reap the benefits of the surging hospitality market described below.

Abbrev. "Hotels Freshen Up After Postponing Renovations" By MARTHA C. WHITE
Published: December 5, 2011 via the New York Times

Hotels are expected to spend $3.5 billion this year to upgrade items including sheets, pillows, lobby design and décor, 30 percent more than in 2010, according to Bjorn Hanson, divisional dean of the Preston Robert Tisch Center for Hospitality, Tourism and Sports Management at New York University. But that is still far from the $5.5 billion they collectively spent in 2008. Still, it is the first increase after two years of reduced spending.

Mr. Hanson said that when the recession hit, the hotel industry was coming off several banner years that had increased profits and provided ample cash for improvements and upgrades. “The peak amount spent in 2008 was reflective of many enhancements,” he said. “The industry went into 2009 in the best physical condition it had ever been in.”

“Travelers were understanding in 2009 and even 2010,” he said. Unusually low rates made it easier for guests to overlook a bit more wear and tear, he said. But when rates began to climb this year, “Consumers became less tolerant of those conditions.”

But now, management companies want to return to business as usual. Not only are they concerned that negative traveler experiences will tarnish their image, but they are acutely aware that renovating now can give them a competitive edge as travel picks up. Mr. Strong said management companies do not want owners to renovate rooms a little at a time — curtains one year, rugs the next and so on — because it diminishes what he calls the “wow factor.” While it is more economical for hotels to renovate incrementally, guests do not get the impression that they are staying in a truly refurbished room, he said.

“The guys who have money are starting to do renovations because it’s the smart thing to do and get ahead of the competition,” Mr. Ross, of Citadel, said. “I feel very strongly that if you have the money, now is the time to spend it fixing up your property or buying a property and fixing it up, because your competition won’t have the money.”


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