F.A.Q

 
     
   
     
 

FREQUENTLY ASKED QUESTIONS

The hospitality industry is often quite insular in its approach with hotel developers and owners on clearly explaining how things work, how things happen and what they actually deliver. We have been exposed to many situations in our collective careers, where questions were asked and answers not given. We have recorded what we believe to be the most relevant and helpful of the questions we have received over the years and given clear and honest answers from the developer/owner perspective, basically being sat on their side of the table. We hope you find this helpful.

Q. What should I do first if I am planning to develop a hotel or resort?

-
Appoint a qualified company to perform a full feasibility study which needs to answer the questions, does the current and future market need a hotel/resort, if yes what category of hotel including size/facilities, how much will it cost to develop, what kind of returns can be expected, what are suitable brands/management companies? This will allow for an informed decision on the way forward.
-

Check the track record of the company/brand to ensure that they can deliver what they promise as well as being relevant to the positioning of the property. At the end of the day, it is the people which make the difference between a performing and underperforming property. Correct and relevant positioning with focused Sales/Marketing and Distribution is the key to success.

- Relating to getting the management company involved early on in the project, this is important and will save you money and time. They will help shape the right facilities with the architect and Interior designers as well as specifying manning levels and equipment purchasing.

Q. Do I need a hotel management company to be involved in my planned development?

-

Yes and the earlier the better, there are many qualified management companies which can help develop and then manage your property as an independent hotel/resort or as part of an established brand, the selection of which company is suitable should always take into consideration the feasibility study conclusions.

- Ideally these options should be recommended through the feasibility study as especially some brands sign exclusivity agreements with developers in destinations or zones with-in destinations so the brand may not be available.

Q. How do I appoint a management company/brand for a new property?

-

Ideally these options should be recommended through the feasibility study as especially some brands sign exclusivity agreements with developers in destinations or zones with-in destinations so the brand may not be available.

-
Management and brands are best researched on line and then should be invited to meet and present themselves, remember the most attractive presentation is not always the best solution, always keep in mind the results of the feasibility study.
-

Management companies and brands will normally execute the following paperwork;

Commercial Term Sheet (highlighting the duration, fees and conditions of the engagement) This is the time to negotiate.
Once the commercial term sheet is concluded, then a either a Memorandum of understanding (MOU) or a Letter of Intent (LOI) will be issued and needs to be signed. This ensures that the developer is locked in on an exclusive basis for a fixed period of time to execute the contracts. If this expires or is allowed to expire, then there is no binding commitment by either party.
Once the MOU or LOI is concluded, then the following agreements are executed for signing, the range of contracts may differ based on the company/brand;
1.
Technical Services/Pre-opening Assistance agreement: Consultancy and activity from appointment to the opening of the hotel/resort. This is either on a cost per key or lump sum basis and with staggered payments. Note this fee does not vary dependant on when the appointment takes place so the earlier the better.
2.
Management Agreement: Deals with the management of the hotel/resort and normally a percentage of Gross Revenue and a percentage of Gross Operating Profit for the term.
3.

Licensing Agreement: Normally for brands only which take a percentage of Gross Revenue or Gross Room Revenue for use of the name/mark.

4. Sales & Marketing Agreement: Normally for brands only which take a percentage of Gross Room Revenue to promote the brand, not your specific hotel/resort.

We will consistently refresh the content of F.A.Q. which will cover the thousands of questions you, the owner and developer need to be asking.

 
     
   
 
 
 


  • AHS eNews 2017 Edition Q2 & Q3
  • AHS eNews 2017 Edition Q1
 
 


Click to download our brochures....
  • AHS Profile
  • U Hotels & Resorts Brand
  • Eastin Grand Hotels Brand
  • Eastin Hotels & Residences Brand
  • Eastin Easy Brand
  • Travelodge Brandbook
  • Vienna House Brand Presentation
 
 


  Join our mailling list,
stay tuned with latest update
 
 
Home     |     About us    |     Services    |     News    |     Team    |     Our Clients    |     Absolute  Brands    |     Alliances    |     F.A.Q    |     Careers    |     Contact  us
2008 © Absolute Hotel Services . All rights reserved. | info@absolutehotelservices.com