Time to Renovate?

Lobby carpeting look a little ragged? And how about that circa-1985 dusty rose color scheme in the guestrooms, complemented by massive armoires and chrome-trimmed bedside tables — they're crying for an update.

These are the obvious signs that it's time to call in the design and procurement specialists for a property freshening. But there are other factors, too, say industry experts.

It's a hugely busy time for hotel renovations. With the industry in a strong growth and revenue phase, owners and developers are scrambling to renovate tired properties and incorporate the latest design elements — including updated bedding packages, improved bathrooms and the latest technological gizmos.

“Before Sept. 11, during the last turndown in the economy, hotels were creeping along without spending much,” recalls Ron Lustig, AIA, principal design architect, Earl Swensson Associates, Inc. “Now that cash is flowing again and hotels are flipping, we're seeing a lot of refurbishing.”

YOU KNOW IT'S TIME WHEN…

Besides the obvious signs of wear and tear, sometimes the decision to renovate is made for the hotelier — i.e. — when there's a change of ownership. “Every hotel chain will submit a PIP (property improvement plan); that's an absolute given,” says Jonathan Nehmer, AIA, president, Jonathan Nehmer + Associates. “You buy a hotel and it may look great but that's an opportunity for the chain to come in and evaluate whether your ff&e meets their standards and design specs.

“Also, if you want to reposition the hotel, place it in a different tier or give it a different character, clearly that's an opportunity and need for you to replace ff&e. And of course, there's the age factor. That's the one everyone has a different opinion on. The norm in the industry is five to eight years for soft goods, although eight years is pushing it.”

Obviously, higher-volume hotels such as airport properties and resort hotels may need earlier changeouts. Another factor is the quality of the most recently installed ff&e. The higher the quality, the longer things should last, theoretically. Those are the decisions your designer should help you with when you're in the early stages of the design planning process. “It's a dance between cost and durability,” says Nehmer.

The trend toward triple sheeting and more frequent laundering of bed linens also affects the renovation life cycle, adds Brooke Robinson, director of interior design, at Nehmer.

“With so many of the hotel chains going with triple sheeting and using natural fibers or a cotton/poly blend, which also require ironing and will disintegrate over time, you're looking at a shorter life cycle on those items,” says Robinson. “Often in commercial design, things are engineered to last forever, which in hospitality is about 25 years.

“But there's also the fashion aspect of it. You want your guests to feel everything is fresh and new, all the time, even if it's six years old. In hospitality design pricing is often lower because trends dictate more frequent turnover in ff&e.”

A LOOK AT LOEWS

Loews Hotels recently brought on board industry veteran Richard Senechal as senior vice president overseeing design, construction and facilities management for the upscale chain of 20 North American properties. One of his major initiatives is systemizing the renovation lifecycle process. “We're in the process of conducting extensive surveys of the age and condition of every component and every piece of equipment in every hotel so we have a strong data base of information,” says Senechal. This includes detailing every element and every piece of equipment with model numbers, age and renovation history. “We'll then use this data as a tool to do our capital planning. And from that you could do a predictive analysis when you're looking at five-year and 10-year capital spending cycles — a predictive analysis of how much money you'll need in certain areas of the hotel in certain years.

“That doesn't supercede rational judgment, obviously,” notes Senechal. “We look very carefully at every hotel very frequently, whether or not the condition of any specific area suggests it needs to be renovated. We're sensitive to not being bound to the suggested life cycle so much as using it as a tool to let us do a rational job of capital planning. The life cycle analysis is something you use as a starting point and then from there you use your professional judgment about what has to be done and the priority for various areas of each hotel.

“A big part of what we try to do here at Loews is generate a very residential feel,” says Senechal. “And sometimes those materials are more fragile than the more commercial materials used in two- and three-star properties, although we attempt to make them as durable as possible.

“Right now, renovation is hot, everyone is busy,” says Senechal. And that means longer lead times on everything from design specs to installations. “From hiring designers to finding contractors and materials, everything is taking longer than it did a few years ago.”

FOR MORE INFORMATION

Comprehensive formal studies of capital expenditures (CapEx) in the hotel industry are available. For example, the Internatioal Society of Hospitality Consultants conducted studies in 1995 and 2000 and is currently working on a new study. The insightful studies surveyed the industry to see whether spending patterns related to CapEx have changed over time, from the total dollar amount spent to the specific areas of a hotel where expenditures are made.

The findings are based on a survey of more than 500 hotels representing 22 different brands and independents in the U.S. These studies investigated all of the capital improvement costs of owning hotels over an asset's life span — not just the cost to replace short-lived items or ff&e.

For a look at a timeline and current costs for replacement of most components of a hotel, contact the ISHC at www.ishc.com.

Visit www.LHonline.com for more information and related articles.

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