Hotel Development Chapter 3 (Continued)
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Questions and Answers

Hotel development is a quick process.

False (B)

What is an example of a factor that influences a successful hotel?

Location.

What is the first step in hotel development?

Conceptualization

What is the final stage in hotel development?

<p>The opening.</p> Signup and view all the answers

What must be obtained before the actual design and construction of a hotel begins?

<p>Funding.</p> Signup and view all the answers

What is the main objective for the back of the house?

<p>Efficiency and control.</p> Signup and view all the answers

What does Ambiance tell guests?

<p>Whether they are in an economy or luxury property.</p> Signup and view all the answers

The ______ is the complete impression a lodging facility gives to its guests.

<p>Ambiance</p> Signup and view all the answers

Flashcards

Hotel Development Process

The sequence of steps to develop a hotel from concept to opening.

Conceptualization

The initial phase where developers clarify the project concept and goals.

Feasibility Analysis

A study to determine if a hotel project can be successful and profitable.

Commitment

The stage where funding is secured and development plans are finalized.

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Design and Construction

The phase involving the hotel's architectural design and actual building.

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The Opening

The final stage where the hotel officially starts operations and welcomes guests.

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Location Importance

The crucial role that location plays in a hotel's success.

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Airport Properties

Hotels near airports designed for travelers and airport staff.

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Downtown Properties

Hotels in city centers, typically high-rise and catering to business travelers.

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Suburban Properties

Hotels located outside city centers, often mid-rise serving travelers seeking convenience.

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Highway Motels

Simple motels catering to transient guests traveling along highways.

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Resort Hotels

Hotels that are destinations in themselves, often near attractions.

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Feasibility Study Components

Factors like profit potential and operating expenses evaluated in feasibility studies.

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Finding Investors

The process of seeking financial backing for hotel development.

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Determining Costs

Estimation of construction and operational costs for the hotel.

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Operating Costs

Recurring expenses that keep the hotel running after opening.

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Controlling Costs

Strategies to manage and reduce hotel operating expenses.

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Design Planning

The collaborative effort in designing a hotel to meet guest needs.

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Front of the House

Areas of the hotel accessible to guests, including lobbies and guest rooms.

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Back of the House

Support areas in a hotel not visible to guests, like kitchens and staff areas.

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Accessibility in Design

Ensuring hotels are usable by all, focusing on safety and comfort.

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Ambiance

The overall atmosphere of a hotel that shapes guest experience.

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Environmental Considerations

Incorporating sustainability and efficiency in hotel design.

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Market Demand

Assessing the need for hotel rooms in a specific area.

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Competitive Edge

Unique offerings that set a hotel apart from others.

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Target Audience

Specific demographics that the hotel aims to attract and serve.

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Macro Market Conditions

Broad economic factors impacting the lodging industry.

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Micro Market Conditions

Local factors that influence a hotel's success and operations.

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Projected Demands

Forecasting future hotel room needs in the market.

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Guest Satisfaction

The experience and contentment level of hotel guests.

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Study Notes

Hotel Development Chapter 3 (Continued)

  • The chapter focuses on the steps of hotel development, from conceptualization to grand opening.
  • Objectives include identifying development steps, understanding location impacts, evaluating feasibility, outlining financial factors, defining hotel design requirements, and explaining ambiance's role in guest satisfaction.
  • The process involves five key stages:
    • Conceptualization: The initial concept development stage, which considers capital sources, financial returns, market conditions (macro and micro), target audience, market sizing, and competitiveness with similar establishments.
    • Feasibility analysis: This stage studies various factors impacting the viability of the project, including expected profitability, financial backing needs, operating expenses, required capital investment, and projected rates/occupancy.
    • Commitment: Involves securing funding and initiating negotiations with construction companies. For internal development, assembling the in-house team is crucial. External development necessitates competitive bidding to find the best fit regarding cost and expertise. Projected operating margins, along with construction budgets, are decided during this phase and incorporated into the design stage.
    • Design and Construction: The design aligns with feasibility study findings and developer goals. Management/franchise agreements are finalized, staff are mobilized, and preliminary marketing and personnel training begins.
    • The opening: The final stage. Sales and marketing functions are operational to cater to guests from day one, and staff are trained for a smooth introduction for guests. The facility then opens.

Types of Hotel Locations

  • Airport Properties: Originally for flight crews/delayed passengers, they offer food/beverage, and meeting/convention facilities for longer stays. Often focused on business travel groups. Close to airports for convenient transportation.
  • Downtown Properties: High-rise structures with high room rates due to expensive land and high rise costs. These hotels cater mainly to business travelers and convention-goers. Occupancy often higher on weekdays than weekends.
  • Suburban Properties: Usually offer mid-rise buildings (200–500 rooms) with lower tax rates and land costs, but often limited by height and size regulations. Suitable for travelers needing quick downtown access but not requiring overnight stays.
  • Highway Motels: Developed with transportation growth, typically one- or two-story structures. Focus often on a smaller number of rooms (less than 200) and transient guests. Often include free parking and basic amenities for business and leisure travellers.
  • Resort & Attractions: Located near or as attractions themselves. Often away from city centers and have unique features that help distinguish them. Resort locations often require developing surrounding infrastructure, including roads and utility systems. They may also include employee housing and services or specialized facilities like meeting/banquet spaces to increase yearly profitability.

Additional Notes

  • Feasibility Study: The feasibility study analyzes factors such as geographic and economic aspects, competition, site characteristics, demand, facilities, and financial projections.
  • Fiscal Commitment: This phase involves securing the financial backing necessary for development, pre-opening, and operating costs.
  • Finding Investors: Investment strategies evolve alongside the economic landscape. Building or renovating an existing structure might yield different financial returns depending on the time period.
  • Determining Costs: A rule of thumb suggests a rate of $1 in room rate for every $1000 spent in constructing a room, but more modern costs impact calculations considerably. Pre-opening costs (personnel, advertising, and public relations) and furnishing/decorating costs can significantly add to overall construction costs.
  • Controlling Costs: Understanding and controlling operating costs (wages, salaries, benefits, marketing and advertising, and facility operations) are crucial. Energy efficiency is a significant aspect to consider.
  • Designing the New Hotel: Owner and management involvement is vital throughout the construction planning process to ensure the facility meets guest needs and allows for efficient operation. Design considerations must also include accessibility (location and property design) and comfort aspects.
  • Ambiance: Ambiance is shaped by the design materials, colors, sensory perception, and sensory consideration that contribute to a guest's overall impression during their stay.

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Hotel Development Chapter 3 (Continued) PDF

Description

This chapter dives into the essential steps of hotel development, starting from conceptualization and leading to the grand opening. Key focus areas include feasibility analysis, financial considerations, and the importance of design in enhancing guest satisfaction. Understand the implications of location and the strategic steps necessary for successful hotel projects.

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