HVS International Journal

In this Journal:

Options for Entering the Las Vegas Market
By: Mark Capasso
HVS International Hotel Development Cost Survey 2002
By: Elaine Sahlins
Condo Hotels – Evolution Toward A Commercial Hotel Structure
By: Michael T. Sullivan &
Marshall A. Bendelac
The Upside: Potential Returns Can Be Big When Buying Hotels In The Down Cycle
By: Rod Clough
The Hospitality Industry in Turkey:
A Current Overview
By: Bernard Forster
Just Hang On to What You’ve Got:
How to Maintain your Customers
By: Bill McBain
Director Pay in Public Hotel Companies
By: Keith Kefgen & Michael S. Kogen
Making Customer Feedback a Priority - A Key to Inducing Demand and Maximizing Value
By: Mark Lynn

Options for Entering the Las Vegas Market

Over the last decade, Las Vegas has blossomed into one of the largest convention and group resort destinations in the world. As shown in the accompanying graph, the Las Vegas Convention market has more than doubled from, only two million delegates in 1992 to over four million delegates in 2001. Additionally, non-gaming economic impact has increase from roughly $1.7 billion in 1992 to almost $5 billion in 2001.

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HVS International Hotel Development Cost Survey 2002

By: Elaine Sahlins

Last year, the San Francisco office of HVS International announced the redesigned hotel development cost survey. While HVS International has tracked hotel construction costs throughout the United States since 1976, the 2001 survey introduced data for a larger range of hotel products, setting new 2000 baseline ranges for six lodging types: Economy/Budget Hotels, Midscale Hotels w/o F&B (without Food and Beverage), Extended-Stay Hotels, Midscale Hotels w/ F&B (with Food and Beverage), Full-Service Hotels, and Luxury Hotels and Independent Resorts.

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Condo Hotels – Evolution Toward A Commercial Hotel Structure

By: Michael T. Sullivan &
Marshall A. Bendelac

Condominium hotels, or condo hotels, have become an increasingly popular format for development, particularly in resort-oriented locations. Obviously, the nightly rental of condominium units, which are placed in a rental pool by condo-owners, is nothing new, as this practice has occurred for years in resorts and a few urban locations. What has changed, however, are the scope and nature of these properties and the relative relationships between the condo-owners, property managers, traveling customers, and project developers. This article will explore the scope and nature of these changes.

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The Upside: Potential Returns Can Be Big When Buying Hotels In The Down Cycle

By: Rod Clough

Hotel buyers active in the last hotel down cycle found hotel assets at discounted prices, driven down by weak cash flow performance and a restrictive lending climate, exacerbated by the influence of the RTC. Using their available financial resources, new owners slowly instigated needed renovations, retooled marketing efforts and, as necessary, re-branded their hotels. Assets with fundamentally good locations, well-designed and constructed buildings (requiring relatively low-cost renovations), were then poised to improve their cash flows once markets turned. For those buyers smart enough to buy low in the early 1990s and sell in the late 1990s height of the market, how much upside was realized? Now that we find ourselves again somewhere along the downward curve of the cycle, can buyers expect similar returns?

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The Hospitality Industry in Turkey:
A Current Overview

By: Bernard Forster

Country Overview

Turkey is one of the few countries in the world that spans two continents. From its borders with Greece and Bulgaria to the west, Syria and Iraq to the south, and Iran, Armenia and Georgia to the east, Turkey's 781,000 km² of land encompasses a rich variety of terrain, climate, local culture and dialects and has a total population of 65 million. Although Turkey’s land borders are 2,753 km long, its coastlines are almost three times as long, stretching for 8,333 km. Turkey is bordered by the Black Sea to the north, by the Aegean Sea to the west, and by the Mediterranean Sea to the south. As a result of Turkey’s geographical position, at any given time it is possible to witness different weather conditions in different parts of the country. The western and southern coasts present a typical Mediterranean climate, with short, mild winters and long, hot summers. The northern coast is cooler and receives more rain. The inner regions of the country have a continental climate with hot, dry summers and relatively cold winters. Such unique and favourable summer climatic conditions, the variety of the landscape and the coastal regions, together with the country’s unique mixture of Eastern and Western cultures and traditions, make Turkey an attractive tourist destination for international travellers.

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Just Hang On to What You’ve Got:

How to Maintain your Customers

By: Bill McBain

With an economy in recession and the horrific events of September 11, the hotel industry has taken a big hit. Certain areas of the country have been more affected than others; the impact has varied by hotel sector as well . The fact is that most hotels are just trying to hang on to their current customers without getting into a discounting war with other hotels in their area.

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Director Pay in Public Hotel Companies

By: Keith Kefgen & Michael S. Kogen

The old axiom, “you get what you pay for,” implies that all things have a price/value relationship. However, paying the highest price does not always ensure getting the best quality. In the world of corporate governance, human capital is the commodity, and it too has a price. Our recent study of Director compensation takes a look at the price/value relationship and compares the hotel, restaurant and gaming segments of the hospitality industry. All data contained in our report comes from public documentation.

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Making Customer Feedback a Priority - A Key to Inducing Demand and Maximizing Value

By: Mark Lynn

Hotel rooms revenue is the end result of thousands of small transactions, better known as occupied rooms or room nights. Rooms revenue is a particularly important component of a hotel’s over-all profitability and resultant value because the operating income generated as a result of room revenue usually constitutes the largest cash-flow-through percentage of a hotel’s various operating departments. The following example illustrates how thousands of individual transactions (room nights) on an annual basis equate to a hotel’s annual rooms revenue. A 350-room hotel operating at 70% occupancy generates 89,425 occupied rooms a year. This same hotel maintains an average room rate of $136.00, resulting in annual room revenue of $12,161,800 (89,425 x $136.00).

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Week of :
June 1, 2002