Hoteliers at high-end properties can’t afford to skimp when it comes to renovations. When renovations are done right, ideally the changes increase profits and meet guest expectations.
REPORT FROM THE U.S.—Whether they spend $7 million or $70 million to spruce up guestrooms or public space, hoteliers need to continually meet or exceed guest expectations to improve their business.
That’s particularly true for high-end hotels, according to sources.
“If you are a luxury property, you have a responsibility to keep the property at that level,” said Philip Kendall, area VP of resort operations for the 96-key Carneros Inn in Napa, California.
The property recently finished the first phase of $6.5-million renovation, which included the Arbor, family pool, and guest entry and reception areas.
The Arbor, which is the property’s main outdoor wedding venue, will receive a $1-million renovation with significant landscaping upgrades. On the other end of the 25-acre property, an elevated deck with a shade trellis, padded lounges and furniture, fresh paint, and lush landscaping will enhance the family pool.
“We focused on areas that had a return on investment, so we increased the attractiveness for weddings and meetings and increased pre-function space,” Kendall said. He said the property’s average daily rate is $700.
Hoyt H. Harper II, SVP and global brand leader for The Luxury Collection, said a recent $40-million renovation of the 556-room Palace Hotel in San Francisco was done with a goal to increase ADR and change the hotel’s business mix “to attract more premium meetings and events.”
“We’re attracting high-end groups and are appealing to the elite travel programs,” Harper said.
“We haven’t skimped. We can’t afford to,” he added.
At the Doral Arrowwood, a resort in Rye Brook, New York, ownership and management recently finished a $4-million renovation that includes refurbished guestrooms and conference rooms; enhanced, efficient guest services with expanded Wi-Fi; enhanced operational software and new audiovisual equipment.
The renovation is helping the property meet the demands of the conference and leisure markets, according to Jack Meehan, director of sales and marketing for the property.
“Things change quickly in the meetings world,” he said. “Technology changes so quickly so you have to stay on top of it. Customers want quick Wi-Fi, top-of-the line IT and AV and soft seating in the meeting rooms, which are extensions of their offices. Our customers’ presentations need to be executed flawlessly, so we need to support them so they come back. Repeat business is a large part of the resorts business.”
Meehan said it wasn’t difficult to determine what renovations needed to be done on property, adding that ownership is constantly putting money back into the hotel every year to avoid huge renovations.
“Our customers are seasoned travelers, so we have to be on top of our game,” he said. “We’re always adapting and upgrading. It’s less disruptive for guests if you stay on top of it year after year. That’s the key to success.”
Kendall agreed that it’s important to meet guest expectations not only after the renovation but during it, too.
“You want to do as much as you can at once,” he said. “We want guests to have the right expectations and lessen the impact of the renovation. This is not a traditionally built hotel, so there wasn’t a significant impact on guests. There was no renovation work on weekends, and we always had our restaurants open.
“You have to know your business,” Kendall added. “For example, when you say you need the contractors to take the afternoon off, know they can. Make sure your contractors know your construction protocol, language, dress, etc. And know your timeline. You need to make sure these dates aren’t pie-in-the-sky dates because I’m selling into the month we’re expected to finish.”
Mixing old with new
Meeting guest expectations can differ when it comes to older hotels that might have historical value.
Hotel developer Ed Riley is working to complete a historic $73-million restoration of the Marriott Syracuse Downtown, formerly the Hotel Syracuse, which originally opened in 1924 and closed in 2004. Riley, with the assistance of the Syracuse Industrial Development Agency, purchased the hotel in 2014.
“This hotel is a huge part of the city’s history, but it was in such bad shape,” Riley said. “Not too many people would take on this project, but I had to help rescue it.”
“Many people have fond memories of this hotel and were disappointed nothing was done for so many years,” said GM Paul McNeil. “They didn’t want it to be demolished. There’s a big emotional connection to the hotel.”
As a result of the ground-up restoration (the hotel was gutted and every system—HVAC, electrical, plumbing, gas, roof—was removed and replaced), the Hotel Syracuse Restoration Company uncovered an iconic barbershop, covered-over windows and balconies and original art-deco terrazzo floors.
“Most people will not have seen the lost historical charm,” McNeil said. “We’re bringing back the hotel’s ornateness and pairing historical elegance with modern conveniences. We’ve received a lot of support from the government (including historical tax credits) and politicians.”
The renovated property will feature 261 guestrooms and 18 suites, three ballrooms, a conference center, a full-service restaurant, a sports bar, steak house and a coffee shop. Terrazzo floors and 20-foot columns will adorn the lobby, along with murals on the ceilings and 17 restored original chandeliers.
Harper agreed that older hotels can come with construction problems behind the scenes. Just because guests can’t see them doesn’t mean they won’t take notice. That’s why the management of the Palace Hotel addressed infrastructure issues, such as soundproofing rooms because of hotel’s wide hallways and high ceilings, as well as an updated HVAC system, elevators and doors (while keeping the original designs).
“There are infrastructure issues with older hotels that guests don’t see, but they know if they don’t work,” Harper said.