Contractor’s Perspective on Renovating Chain Hotels Versus Boutique Hotels
Renovations play a critical role in the long-term, strategic planning of single and chain hotel properties nationally. Upgrades and rebuilds not only extend the life of a hotel property, but they also can boost image, competitiveness and efficiency.
When it comes to hotels, Americans have more options than ever, from the tried-and-true branding of large chains to smaller boutique hotels aiming to provide unique, one-of-a-kind experiences. Both options work, but offer distinctly contrasting atmospheres.
These contrasts pose challenges to renovation contractors. Construction procedures and design goals differ greatly between chain and boutique hotels. Boutiques have become synonymous with the idea of quirky cool while major chains rely upon uniform, pre-approved Property Improvement Plans (PIPs).
“The boutique hotels we’ve renovated have been designed based on inspiration and building character,” said Sam Cicero, Jr. President of Cicero Construction, one of the country’s largest hotel renovation contractors. “Chain hotels are typically prototype buildings and have a PIP that needs to be strictly adhered to for a hotel to remain in compliance with brand standards. This limits design flexibility but means the project will run faster and smoother with fewer change orders.”
PIP packages are created months in advance and all construction products have been tested to meet the chain’s standards. Construction schedules are painstakingly established with no detail omitted. In the event a chain hotel owner wants to alter the PIP it can be a long, drawn-out task to receive brand approval. There is good reason for the brand’s strict adherence to PIP specifications: the main reason travelers gravitate toward a large chain is brand recognition. Knowing exactly what they're going to get no matter what city they're in is attractive to travelers. While each location in the chain may cater to local needs, the hotel still features the same style and amenities in their suites, lobbies, signage, meeting rooms, and restaurants and lounges.
Autonomy is a major advantage held by independent boutique hotels which runs counter to the structure and nature of chain hotels. In planning a renovation, boutique hotels can factor in highly localized demographics and preferences that are consistently evolving. They are in a better position to understand and adjust to the neighborhood in which they operate, so they can make renovation decisions to take advantage of this knowledge. In addition to lodging visitors, boutique hotels can renovate with the goal of serving as local gathering places, supporting neighborhood initiatives and partnering with other businesses to ensure their community remains vibrant.
However, all this flexibility comes with a cost. Boutique renovations are much more likely to run into problems as a good amount of the scope is customized and subject to frequent changes by the owner. Once construction starts, there may be high-end details added by the owner to give hotel guests a more luxurious experience, details that were not included in the original scope. An inexperienced contractor will quickly lose control of the renovation because of this.
“Since most boutique hotel renovations call for one-of-a-kind designs with specialized materials, a lot of the questions may have not been answered,” says Cicero. “Compared to a PIP where every detail is laid out, there is a considerable amount of additional time spent reviewing materials and how they will work with each other. Receiving the necessary spec sheets for all materials being used on the project is an administrative struggle.
“When a problem does arise in the renovation, however, I’ve found most boutique owners are appreciative of our expertise and are open to ideas that would change the scope to solve it.”
The age of the property housing the boutique hotel, and therefore its mechanicals, can also be an issue. Boutique hotels are often in historical buildings where HVAC, plumbing and electrical are no longer functioning as efficiently as modern systems. Opening up a wall in the hotel may expose problems in wiring or piping that will need to be repaired before the renovation can continue. Depending on the city’s building code, a major renovation may also trigger an avalanche of upgrade requirements for systems that were grandfathered in or for new systems, such as fire sprinklers.
Chain hotels renovation challenges predominantly come down to decision making, explains Cicero. “It can be a struggle to receive quick responses to questions, especially over the weekend, as the hotel’s contact person has to run it up the chain and wait to hear back. A contractor may need answers in minutes but they can take days. Delays in decision making lead to cost overruns and postponing putting guest rooms back into service.”
To remedy this predicament, Cicero Construction relies on open communications between its team and the property owner. This runs through the initial stage of scope planning and budgeting, to the bidding process and performing the work — all the way through to completion of the project and long after it is completed. Elements of Cicero’s open communications include a daily report identifying manpower levels, deliveries, safety, and current areas out of service. Weekly phone calls take place to discuss the overall schedule, design and operations so that all parties can work to manage issues as a team.
Hotel renovations help owners gain market share, increase guest satisfaction, drive revenue performance, and enhance profitability. While every renovation is unique, there are stark differences between renovating a boutique or chain hotel. Hiring a contractor with extensive experience in navigating those challenges is the key to profitable outcomes.