Need for new technology is changing the hotel business

Hotels will have to be refurbished more frequently than in the past because customers are becoming more discerning and technology is changing so quickly, according to a new report from Jones Lang LaSalle.

The Australian head of project and development services at JLL, Kevin Hastings, said hotel owners needed to stay abreast of technology to ensure guest and meeting rooms were furnished with the latest equipment. The hotel required the necessary infrastructure to support new technology, such as cabling and wireless hot spots.

''With tight capital expenditure budgets now par for the course for many hotel operators and owners, a strategic approach is needed to ensure investment is maximised,'' he said.

The issues are set out in a new white paper by JLL's project and development services division and hotels division, which examines influences on hotel values and issues to consider when planning capital expenditure budgets.

Mr Hastings said the issues included the age of the asset, legislative changes such as access to premises involving the Disability Discrimination Act and occupational health and safety, rising energy prices, energy efficiency and consumers preferring hotels with the latest technology.

Most hotel operators classified capex as a reinvestment strategy to maintain quality and generate returns.

''The hotel operator's objective is to ensure that the hotel remains in the same condition as when it opened,'' the report said. ''This interpretation fails to address opportunities to value-add and improve the asset by using capex's full potential.''

Mr Hastings said owners and operators needed to collaborate to improve trading performance and adapt to technology advances, changes in consumer trends and compliance with legislation.

Building monitoring and control systems that analysed energy use and drove efficiencies and cost savings were already helping to boost the bottom line, the report said.

With the exception of Melbourne, the reports said there had been minimal new hotel supply in Australia over the past two years, but refurbishment activity had been strong in Sydney, Melbourne, Brisbane and Perth, particularly in the five-star segment.

Source: Business Day, 9 June 2012