
Fabulous bathrooms like this one at the Upper House in Hong Kong are a big item in hotels’ growing list of improvements. (Image: Chris McGinnis)
Major U.S. hotels may have delayed a number of necessary capital improvement projects during and after the Great Recession, but they’re making up for it now with record spending on renovations, upgrades and other guest-related improvements.
That’s according to the latest report from hotel expert Bjorn Hanson at New York University’s Tisch Center for Hospitality and Tourism, who tracks trends in the lodging industry.
Hanson said the U.S. hotel industry’s capital expenditures in 2015 are expected to reach $6.4 billion, a new record and an increase of 7 percent over 2014. Budgets for revamps are growing these days as U.S. hotels are seeing record or near-record room occupancies and steadily improving revenues. Hanson noted that capital expenditures have been rising every year since 2010.
Some of the more significant new trends in hotel improvements, his report said, include lots of work on guest bathrooms, “especially replacing tub/shower units with walk-in showers;” new or improved fitness rooms; and redesigned lobby areas, “primarily to appeal to Millennials, but also to compete with the many new competitor lobby models.”
Hanson said hotels are also spending more money on boosting Internet capacity and bandwidth not just in guest rooms but also in public areas like lobbies, meeting rooms and restaurants; coming up with new restaurant and food concepts, again with Millennials in mind; putting new, larger and smarter flat-screen TVs into guest rooms; and adding in-room amenities like new coffee makers, iPads, radio/alarm clocks and so on.
Part of the reason for the increased spending is that many properties belong to big national chains that set specific standards their managed and franchised members must adhere to. But a new factor is also at work, Hanson said: “In addition to brand standards influencing capital expenditures, social media postings are resulting in additional capital expenditures as owners become more aware of and respond to criticisms and unfavorable comments. This effect became significant starting around 2012 and continues to increase.”
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