Crisis times require doubling efforts, in order to keep the business afloat, but also to prepare for the business to return to normal within the shortest time frame. While revenue may not be the main focus anymore, a strong focus on protecting your bottom line is essential. Involve all your team member, and make sure you have an asset management team leading all initiatives. Here is a non-exhaustive list of actions to execute during this uncertain period of time:
Monitor the authorities’s announcement
Implement rigorous cleanliness & sanitation of all area
Provide guideline to all employees in regard to hygiene and infection control
Ensure diligent Employees & Visitor screening at the workplace.
Protect your bottom line
Each property is having its specificity, in terms of hardware, but also in term of software, therefore if you are in doubt, please contact us, and we shall offer you our services or some simple advices. It is unfortunately too often in this crisis moment that Hotel Owner realize the real value of their business.
While it is hard to anticipate when this crisis will end, and while nobody could have been prepared for such disruptive pandemic, it is important to learn some lessons from the current situation, and try to be better prepare for an eventual future outbreak.
NOVA Asset Management has announced the opening of a new office in Jakarta, Indonesia to take advantage of the huge potential of the Indonesian market and to give Indonesian hotel owners and investors better access to the expertise that will help them achieve their intended goals.
As ASEAN’s largest economy by far, and blessed with diverse geographical and cultural attractions, Indonesia is growing rapidly as a tourist destination and looks set to offer significant opportunities for investors.
Over the past five years, Indonesia has shown annual tourism growth of around 14%, with total numbers reaching 16 million arrivals for 2018. Around two thirds of those visitors head for Bali and Jakarta, which currently boast 550 and 350 ‘classified’ hotels, respectively. The rest of the country, including secondary destinations such as Yogyakarta, Bandung, Surabaya, Lombok and Batam, is likely to see increasing visitor numbers in the coming years, and the government is taking an active role in driving tourism.
One important plan which presents outstanding potential for hotel investors is the “10 New Bali” project, through which the government intends to develop ten currently underserved destinations to become attractions on a par with Bali. Among these, four have been prioritized for immediate action: Borobodur (Central Java), Mandalika (West Nusa Tenggara), Labuan Bajo (East Nusa Tenggara), and Lake Toba (Sumatra).
Another key project which will invite significant hotel expansion is the plan to shift the nation’s capital to East Kalimantan, on Borneo. Development is expected to begin next year and will take at least ten years.
At this exciting time in Indonesia’s tourism journey, the opening of the Indonesian office will allow NOVA to better deliver its award-winning expertise to hotel owners in the region who wish to make the best decisions in offering the right product in the right location and therefore achieve the highest level of profitability.
NOVA Asset Management is a regional hospitality consulting firm with offices in Bangkok, Jakarta & Singapore.
NOVA has earned the fastest growing hospitality firm award again this year, and has been recognized as a unique player in the region, delivering a full scope of Owner Representation services, from feasibility studies, hotel operator selection, to full development management on behalf of its clients and partners. This expertise can benefit all kinds of projects from small boutique hotels to ultra-luxury mixed-use development, such as the new AMAN Nai Lert Bangkok, Hotel and Residences recently announced.
It will be possible to learn more about NOVA Asset Management and the new Indonesian office at the upcoming HICAP Conference in Hong Kong on October 23-25.
Nova Asset Management has recently earned recognition as the “Fastest-Growing Hotel Consulting Firm in Thailand” and also the “Fastest-Growing Real Estate Development Company” from International Finance Award 2019.
International Finance Award is a platform that recognizes industry talent, leadership skills, industry net worth and capability at an international level.
Among the well-known companies in Thailand who have received awards from International Finance Award are Sansiri, The Mall Group, and Sena Development.
“We are very proud of what we have achieved as a pioneering asset management company helping owners and investors with their development projects or hotel operations in Thailand and abroad,” said Nova Asset Management CEO Alexandre Bystrzejewski. “It reflects very positively on our company and team to receive such an award for our rapid growth from an International Finance Award.”
“We are very proud of what we have achieved as a pioneering asset management company helping owners and investors with their development projects or hotel operations in Thailand and abroad,” said Nova Asset Management CEO Alexandre Bystrzejewski.
“It reflects very positively on our company and team to receive such an award for our rapid growth from an International Finance Award.”
A Hotel Management deal is like a marriage. The first stage of choosing a partner often involves the emotions, and inexperience can only increase their potency. It takes time to learn who, and how, to trust – and in this regard the same is true for hotel owners. It’s easy to be seduced by a slick management proposal, but in the end the arrangement has to make business sense.
Next comes a word of caution: hotel management agreements are not all about fees. Of course, fees are important, but when they’re lower than you expect – or sometimes when they’re higher than you expect – there’s usually a reason and it rarely works out in your favor. When the numbers seem slightly off, that can be a warning to proceed with caution – so make sure you take advice from industry professionals who have your best interests at heart.
Given the potential for things to go wrong, how should hotel owners go about things the right way? Here are six key ideas from industry experts, Nova Asset Management.
Remember when we compared management agreements to marriage and romance? Happily ever after might be the dream, but preparation, due diligence, and adherence to sound advice are the best way to live that dream.
If you need to renovate your bathroom, a trip to IKEA and a week of DIY makes perfect sense. If you need to renovate your hotel, be aware that the same principles do not apply. A renovation project can cost anything from 50,000 baht to a million baht or more per room, and poor strategic decisions can send that bill spiraling even higher while extending the timeframe from weeks into months, and worse.
Renovation has three phases – and only one of them involves renovating! Pre-renovation and post-renovation also need a strategic plan. What is the new positioning/concept for your hotel? Will you change the name, brand, or re-brand it with another operator? How will the market respond to your alterations? Will you close or remain open? What will be your total project cost and your return on investment? All of these are vital questions for hotel owners to consider before going ahead.
This question may seem odd – surely you renovate because your property needs renovating – but it’s important to dig a little deeper. The key distinction to be made is between maintenance and repositioning. If a hotel is no longer performing well, then a mere facelift to spruce up the property to how it looked in its heyday won’t suffice. Instead, a comprehensive repositioning strategy may be necessary, and that will involve careful thought about how the renovation is going to contribute to the bottom line in the future.
Some renovations will generate new income streams by adding to the products and features available and thereby increasing the demand. Some renovations will save money through improving the operational efficiency of the hotel or reducing energy costs. Other renovations will help the hotel to recover lost ground, perhaps by modernizing the appearance of the rooms so that room rates can be brought back in line with those of rivals. Finally, there are renovations which are essential but do not bring about any financial gain. These might include changes made to fit regulatory requirements, or the replacement of ageing equipment. In all cases, it’s important to know what kind of renovation is about to be implemented, and how it will impact the financial operation of the property.
Is it feasible?
Too many hotel owners believe they can handle everything themselves, and the problems often start from the initial process of selecting a designer or a contractor before even knowing what they intend to achieve (what is the concept, market positioning, scope of work, budget, timeline, etc.). A renovation/repositioning is a highly strategic move that requires a proper feasibility study.
How will it look?
Another cause for concern is that everyone seems to be an interior designer these days. Many hotel owners have great taste but that doesn’t always translate into great interior design. A hotel is highly complex with its specific set of requirements in terms of practicality and functionality, and proven expertise is essential to avoid impactful and costly design mistakes.
Plan thoroughly before you start and get professional advice from Day 1. It’s more expensive to correct mistakes and throw in alterations than to get the details right from the beginning.
Understand why you are renovating. If you aren’t sure what you want to achieve, whether it is feasible, if the market is ready, and how you’re going to recoup the investment, then you aren’t ready to renovate.
Don’t cut corners! If you think it’s expensive to pay for advice, just wait until you see the cost of ignoring it. The soft costs for a professional Development Manager who will help you define your strategy and then execute it will be offset many times over thanks to the the savings in project cost and timing you’ll achieve througha properly executed plan.
In summary, while every renovation project may be unique, the most common ways of going astray are consistent across the board. Avoiding the pitfalls means asking yourself the right questions at every stage, finding the wisdom to take the right advice, and double-checking every detail so that nothing gets overlooked. At Nova Asset Management we know the process inside-out. In the long run, it will probably cost you less to talk to us first.