Developing A Hotel More Efficiently Is Now Possible
July 10, 2009 by Perspective Magazine | Timeshare & Fractional ReviewsDevelhotel.com which is the first online marketplace for hoteliers and real Estate developers went live on July 6th 2009.
Under the current economic climate, it has becoming increasingly important to become more efficient in the way hotel chains, investors and real estate developers plan, design and deliver hotel and resort projects worldwide. The sudden decrease in hotel occupancy, together with the difficulties in financing ongoing hotel construction projects has lead to the re-evaluation of how the different players in the hotel industry develop hotel assets today.
In addition, the hospitality and real estate industries have traditionally relied on extensive face to face interaction between developers, investors and hotel companies and an intimate local knowledge of each geographical market. As a result, the development process of leisure real estate projects and city hotels has historically been expensive and time intensive.
The launch of the first online marketplace geared towards hotel development has meant in the first instance to bring efficiencies to the hospitality industry by eliminating its geographical barriers. Shareholders of hotel companies and real estate groups are looking for ways of dramatically reducing the cost of hotel development. Real estate investors, hoteliers and developers need to achieve reductions in the OPEX of their asset transactions. Develhotel is the answer to this more efficiency-conscious approach.
Develhotel’s Chief Executive Officer, Ivar Yuste, a seasoned veteran of the hospitality and tourism sectors, is convinced that this new online marketplace will significantly benefit the interaction of all the players involved in the development of a hotel or a mixed use project: ‘Develhotel’s users are consulting firms representing hotel owners, hotel chains, private investors, banks, real estate and hotel brokers, construction companies, asset management firms, investment funds, REITs, headhunting firms, consultants, golf course designers, beach club operators, trade fairs organisers, Spa operators and absolutely any company contributing to the development of hotels and resorts in any shape or form.”
- Ivar Yuste
Above all, Develhotel is a community that serves every single company working in the hotel development sector wishing to do business efficiently and cost effectively. Their clients pay an annual flat fee to showcase their assets or projects or to search for projects or properties in any geographic region of the world. Having thoroughly researched the market Develhotel found out that their clients prefer a closed environment that they can trust and can maintain a certain degree of confidentiality.
Simply by joining this platform, users can elevate the visibility of their development plans to a global scale. Develhotel’s role is to put all the parties in contact around specific hotel projects and properties. They do not provide consulting services, nor take commissions on transactions (they are not brokers), and do not organise trade fairs or publish magazines; they want to stick to their core business which is being a platform for hotel companies to do business around specific projects or assets.
The projected number of members in the next 12 months would be several hundred and they have segmented the market into categories – real estate groups, service providers, consulting firms, investors, hotel chains, etc. The key to successful for the platform is to reach the right mix and balance of these companies within these categories so as to try to match supply and demand as much as possible. This mix of users will be monitored closely to make sure the balance is always right.
Develhotel have chosen now to launch their new product despite the economic climate, firstly because currently this service does not exist in the hospitality sector but there has been a demand for it for a long time now and secondly, because due to the current economic climate, there is a pressing need for the two groups of companies in the market to do business together as quickly as possible and now is a time when many companies are looking to save money and become as efficient as possible.
There are two types of companies who will be using the service – Companies that are divesting as they were not prepared for change. They need to sell quickly and need to contact credible buyers in a trustworthy environment.
You also have the companies that have kept some ‘fat’ and are taking advantage of the cycle to grow with opportunistic moves. They have equity and are investing to acquire assets quite aggressively. For these investors, prospecting the market is becoming a nightmare as there are so many simultaneous parties involved with the same individual assets.
The initial feedback received from investment banks and from funds is that Develhotel is a good answer for their research departments to reach out to the right assets and projects.
“We are a global company and are expecting to find our growth in all the main regions of the world. We see great opportunities in many regions, one of them being the Middle East because of the enormous amount of growth and activity in the region.” Says Mr. Yuste.
Many analysts are saying that there is an oversupply in some markets but there are equally several large economies that haven’t reached the required level of hotel infrastructure to make tourism a seriously viable alternative to oil production. There are a number of players in the investment fund arena, that have large requirements for funding allocation in hotel or leisure real estate assets. Develhotels will provide a tool that allows them to select the right projects for investment more efficiently and without devoting so many resources and time in the process.
Develhotel’s CEO is adamant to stress the efficiency aspects that this new tool will bring: “With Develhotel, hospitality and development companies will be able to interact online, first by logging in to the platform from any PC connected to the Internet, showcasing specific projects and discussing specific demands for these projects on a globalbasis. And secondly, once the business opportunities have been identified, by matching the different needs of all the actors involved in a tangible hotel deal. The various executives involved in a transaction will be able to agree on meetings and discussions much more productive and conducive to closing a successful deal for all the parties. Face to face meetings are absolutely mandatory, as they are in any other industry.
Where Develhotel brings an innovative approach to the way we do business today in the hospitality sector is in allowing the reduction of OPEX for all the parties involved in hotel projects.
At a basic level we are talking about optimizing travel expenses, accommodation costs, and T&E expenses for hospitality and real estate executives. However, at a more complex level, Develhotel will have a significant impact in the form of a drastic reduction of the cost of opportunity for hotel development executives. The time that these executives devote to managing existing assets or evaluating new ones is very valuable for their respective companies and shareholders. Develhotel can make the most out of it”, Mr Yuste said.
“From a technology perspective, the website design of Develhotel allows hotels and developers to use this B2B tool across the entire lifespan of hotel assets in a closed environment, from project design to financial sourcing, throughout the search of investors, the operator selection, the construction phase, a possible hotel conversion, the addition of residential units, a contract change or any transaction type (selling, buying, sale & lease-back, bullet, etc.). We have leveraged technology to take all possible parameters into consideration for version 1.0”, stated Omran Boaira, Chief Technology Officer of Develhotel.
“Develhotel goes beyond the simple concept of an online professional network based on listing people’s profiles. Develhotel is rather a database of professionals who want to close deals around specific assets. Hoteliers and investors can search for projects or properties and developers can showcase their hotels and resorts in order to find the appropriate business partners. Our development team is already testing version 2.0 with new functionality and tools that we will be unveiling in the coming months”.
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