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Renovate or Die !

That may sound like a melodramatic rallying cry, but actually it’s a stark fact-of-business life for hoteliers. Once a property loses its appeal, it loses guests – which leads promptly to lower rates and inevitably to lower revenues.

So a major challenge for owners is to keep their hotels fresh and “up to standards” – those of the traveller and those of the brand. That’s the “why” of renovation

But no less daunting is the “how” of renovation – namely, the challenge of keeping the disruptions associated with renovation construction to a minimum for guests.

Let’s look at these two challenges briefly.

Why Renovate?

  • Hotels go through a rather predictable cycle – they open, they ramp up, and they peak, a process which typically takes three years. This peak usually lasts about three years, then the property begins to decline as it no longer has the style and the gadgets of newer models.


  • Consider this – a 100-room hotel operating at 75% occupancy can have more than 50,000 visitors per year. That’s a lot of wear-and-tear on furnishings – and it’s why renovation is a


  • Certainly different FF&E items receive differing amounts of usage and therefore can be replaced on differing schedules. So while hotel renovation and refurbishment can be incremental, they are nevertheless constant.
  • Put another way – you have to spend money to make money. How much money? One handy rule of thumb is 5% of revenues each year.
  • Think of your hotel renovation fund as a proactive management tool – the vehicle that gives guests what they want and what they’re not getting at any of your competitors. Plus the vehicle that gives you improved RevPAR.
  • If your occupancy is a little soft right now due to the economy, this may be an especially good time to take care of some renovation projects – you’ll disrupt fewer guests, you’ll displace fewer room nights, and you’ll be positioned for the upswing when it comes.