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Process In Hotel Development

publication date: Oct 15, 2012
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author/source: Kunal Mhatre
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The ability to add value and to create a sustainable hotel project ultimately starts from the first brush on paper and opportunities for this are all the way through to the final touch of paint on the finished product. Hotels are typically more complex to develop compared with other asset classes, as their design is tailored to the brand operating the business.

 The design of these can also have an impact on the overall profitability of the hotel operation, as design deficiencies affect the operation of a hotel and ultimately have a negative impact on the bottom line — and hence asset value.

 In order to reduce the risk of developing a hotel, which may not be commercially successful, it is important to seek advice from a hospitality consultant, who will ultimately act as the commercial conscience of the developer.

 At the start of the development, prior to building and design stage, the most important question to answer is “is the project viable?” Demand and supply factors for the hotel project need to be identified in order to understand the dynamics of the future operation — to basically understand who will be the target audience for the hotel and build for that. A developer needs to have an understanding of the estimated cash-flow income of the future operation from the opening day of the hotel. This will then provide any potential investor with a comfort level that debt can be serviced from the operation.

Process In Hotel Development

 When hotels are part of a wider scheme, the design and development of the hotel needs to be in line with the overall development vision of the scheme. In a resort environment, it is important to understand the relationship between hotel, golf, spa, residential and other facilities, and in an urban mixed-use scheme.

 The hotel will, more often than not, be managed by a professional hotel oprator. It is always of benefit to ask a consultant to run a competitive tender processes (be it tailored or to the wider market) when looking for a hotel company to manage your property, as this provides the opportunity to drive the process in order to achieve the best commercial deal terms available in the market. These contracts typically run for 15-25 years and key terms agreed at the beginning will have a major impact going forward.

 Hotels are particularly sensitive to market changes, economic downturns and to alterations in supply and demand — for example when competitive hotels open up next to your own hotel this can severely impact performance. It is better to have all advice and information prior to decisions being taken on concept, design, architecture style, number of rooms, size of facilities, star classification and so on — to avoid the need to either redo all the aforementioned or to face the possibility of building a hotel which no operator wants to manage or which will not be commercially viable

 Stages in the Design Process

 The following section will briefly review each stage of the design process, as well as some of the activities associated with each event.

 Master planning:  This is the first step in the process, where you establish what your project should consist of, and if it should exist at all.  The main objectives of this phase are justification of the project and exploration of potential design solutions.

 Programming:  Once you have determined that the project is at least worth exploring, a narrative should be developed that will describe the scope of the project as well as its various “components,” such as the individual areas within a single facility, or facilities that comprise a greater complex.  This narrative will often include required adjacencies (areas that must be located one another), desired sizing, and any special requirements or considerations.  The program communicates the owner’s desires and requirements to the design team in written form.

 Concept Design:  This is often the first time that the effort includes any form of graphic communication.  The conceptual design is the first attempt to translate the written program into graphic form.  It will typically consist of Bubble Diagrams, which identify the anticipated location and size of each area in the program.  It may also consist of renderings that highlight the exterior, entry, or other key design elements of the project.

 Schematic Design:  This phase in the design process builds on the Concept phase through the development of Block/Schematic Drawings, geared to identify elements such as walls, counters, and key pieces of furniture or equipment.  These drawings focus on defining the footprint of the space, but do not contain a great deal of detail within these “blocks.”

 Design Development:  At the end of this stage, the general floor plan is typically locked in and the detail within each space must be defined and developed.  Whereas a bar’s locations and dimensions might have been identified in the Schematic Phase, it is in Design Development where the individual pieces of equipment are selected and incorporated into the design.  At the end of this phase, it should be expected that all walls, furniture, fixtures, and equipment will have been included on the drawings and clearly identified.  While it is not necessary to know the manufacturer of an individual piece of equipment in our bar, it is important to know what equipment is required, as well as the required dimensions and configuration

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 Construction Documents:  Also called Working Drawings, this stage consists primarily of the mechanical, electrical, and plumbing (MEP) coordination required to make the building function.  The “systems” within a building are very similar to those which exist in the body when you think about it – Structural (skeleton), Mechanical (breathing), Electrical (basis of cell communication and activity), plumbing (well, you should be able to figure that one out yourself), etc.  This phase requires a significant amount of coordination between a large numbers of disciplines.  It is an extremely important aspect of the design process, as a mistake in this stage can be very costly.

 Specifications:  Once the Construction Documents are completed, written specifications are developed to convey all of the information to the construction team.  These specifications include details on the manufacturer, model number, and any required options for everything from the door hardware to the paint, and the flooring materials to the foodservice equipment.  These specifications are then used by the construction team to gather pricing from General Contractors and their sub-contractors.

 Cheaper to Change Paper

 At the end of the Specifications phase, the design documents will have been completed and the bidding and construction phases will begin.  As you read through the phases of the design process, and the activities contained within each, it becomes apparent that there is a sequence of events that must be followed.  Can you imagine trying to develop written specifications in the design development phase – before most of the engineering of the space has been finalized?  Only if the entire development team (including the owner) is aware of the required sequence can the design process be effective and efficient.  I often encourage clients to hold off on proceeding to the next phase if they are not 100% sure of the current direction.  Going backwards is difficult, as it requires both undoing and re-doing the work that has been accomplished.  Not only does this require a substantial amount of time, but it also increases the risk of costly mistakes in the development of the drawings.

 Throughout the design’s evolution, the development team must check back with the previous phases to ensure that the design solution is consistent with the original objective.  In other words, at the end of Design Development, and before the initiation of Construction Documents, the team should review and compare their current effort to the end result of the previous phases … just to make sure that they are content with the current direction.  If all is well, then keep chugging along!  If all is not well, however, then it is time to stop, review, and address the elements of the design that are not consistent with the overall objective.  After all, it is much cheaper to revise the design than to make revisions in the field, in the midst of construction.  Stated another way, it is much easier to change paper than it is to change concrete and steel.

Kunal Mhatre Kunal Mhatre  Business Development Manager at RIMC SAHIL HOSPITALITY INDIA PVT. LTD.
Mumbai Area, India                    Hospitality               

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