Build a long-term relationship with your Investor

A hotel can be a fleeting experience for the consumer; often done in one night, with most of that spent unconscious. There is nothing left but memories and a bill. The industry is trying its hardest to create a more permanent bond through loyalty programmes and talk of the 'experience', but it can be challenging to enforce connection with so intangible a product.

For an owner or investor, the opposite is true; this short-term product is typically for the long-term hold. Even the most flip-happy private equity house will hold a hotel for three years or more and during that time the consideration will be not only that fleeting nightly rate, but investment to drive asset value and a possible move up the chain scales.

Hotels are so much more than a real estate play. They are operational assets, invariably run by people who are passionate about their work. Being open 24 hours a day, 365 days a year, requires dedication and the passion and commitment needed adds an emotional dimension overlooked at your peril.

A hotel is a business made up of myriad departments, each of which has to be well-managed to create a cohesive whole. The same is true around the ownership structure, with multiple stakeholders having skin in the game, be they the owner, the brand, an operator, a lender or investor, all of whom may have a diverse range of aspirations.

On the plus side, however, the one certainty is that all stakeholders tend to be happy when the hotel is performing to its optimum and is profitable.

For the brand, depending on its size, the hotel will sit somewhere on a sliding scale of priorities depending upon its significance. It may be a flagship property, acting as standard bearer for the brand, or perhaps one of multiple “flags” across a crowded map representing part of an already-busy market, signed as grist to the ongoing pipeline mill. The brand will be looking to revenue from fees and an otherwise quiet life.

For the operator, whether also the brand or the third-party, the key will be to meet or exceed all agreed KPIs, retain the management and to achieve their incentive fees.

For the owner or investor, a hotel may represent anything from short-term hold to generational play.

It may be part of a portfolio of luxury hotels, or part of a portfolio of hotels across the scales and across brands, or even unbranded. The hotel could also be a hedge, providing balance in a portfolio of properties in other asset classes. Whatever the reason, the desire for success and profitability will be universal.

And, for the lender, there will be a risk management and safeguarding priority to provide assurance not only at the point of financing but throughout the banking relationship.

For each of these stakeholders, whilst the specifics of their needs and motivations may vary, all will be satisfied by a hotel that is firing on all cylinders; departments running at optimum efficiency and working cohesively with each other to maximise profitability, fees and value. Of course, that is easy to say, whilst a more complex goal to achieve.

Whilst the multiple requirements of a particular hotel may be nuanced, a truly effective asset

manager can be the stakeholder with the greatest opportunity to marshal all parties and facilitate success.

At a basic level, the role of the asset manager is to understand connections between the different relationships and to interpret those nuances.

As asset managers we take that approach to a different level. Whilst usually engaged by the owner, we find that the best way to achieve success is approach each assignment with a collaborative mind- set by making it clear that we work for the hotel. In other words, by seeking the best for the hotel, all will prosper.

This is at the heart of the long-term relationships we have developed with owners, investors, brands, operators and key hotel staff. Relationships that have lasted many years and which bring high levels of trust.

Through these trust-based relationships, it becomes easier to not only understand the needs of the hotel and each stakeholder, but to also execute strategy and implement change. It is also extremely helpful when investment is suggested by the brand or by the owner, to provide reassurance to lenders and brands that the impact on the property can be fully understood in its wider context and the true value of the asset might be realised.

Omer Acar, CEO, Raffles & Fairmont Hotels & Resorts, said:

“Throughout my career, from Katara Hospitality to Accor, I’ve had the opportunity to work with many firms in the asset management space. Global Asset Solutions stands apart for their strategic depth, long-term vision, and ability to align all stakeholders behind a hotel’s success. They consistently put the hotel first, prioritising value creation and long-term health over short-term gains. Their approach transcends operational oversight; they are true custodians of value, fostering the trust and collaboration that drive enduring results.”

Prior to his current role, Omer was Managing Director of Europe and the Americas at Katara

Hospitality for nine years, during which time he first connected with Global Asset Solutions.

The right asset managers are able to deliver much more than mere reporting or operational support.

They can also be a critical cog in your funding, development or refurbishment, brand selection and the long-term strategy of your property.