Doing what's been done before
Why are we forced to ask the same old questions in hotel development?
Hotel development is marred by red tape, but that’s no excuse for all running round in circles asking the same old questions
They say that knowledge is power. Is that statement true? Well, if you pay me my customary fees, I’ll let you know! There would be no consultants if this were not true. So, yes, certain kinds of knowledge about say, how to build and open a hotel, for example, are definitely available at a premium.
For example, I’ve just spent the last few months of my life trying to obtain the necessary operating licences for a hotel. You would have thought that after so many new hotels have opened in the Gulf, someone in each of the relevant ministries and government departments would have thought to write down a simple check list or flow chart of the actions necessary to get licensed, and the contact details of the relevant parties.
Ideally, in Arabic, English and Hindi, say, so everyone can quickly understand. You might even have thought that at least one bureaucrat in each country or city would have concluded that, since various different ministries and government departments are involved, it would be useful to create a guide that covers all of them.
In these days of e-government, you might have thought such information would be available on the internet. You might have thought so, but you would be wrong. Why? Because knowledge is power and a lot of people would either feel, or actually be, less important (and in some cases, even unemployed) if this information were easily available.
Those who pay the high price to get this knowledge, after endless hours driving back and forth to government offices, waiting to be attended to, biting their tongues when they realise they’ve waited in the wrong queue, filled the form in wrong, etc, become understandably possessive of what they learn. Why should you have it easy, when I’ve just been given the royal runaround?
Of course, the answer is that we hoteliers could help each other, and create some sort of public access website that contains this kind of invaluable information. Who’s up for it? I’ll contribute my knowledge of licensing in Dubai FOC!
Where's the wisdom?
In a broader perspective, knowledge about the larger hotel development process is also very well protected, and therefore also remarkably scarce. As a hotel consultant, I am constantly surprised by the number of development companies who have a hotel at the planning or even the construction stage, but no one in their team that really knows about hotels.
The recession has obviously caused a widespread downsizing of development teams, even in ostensibly booming markets of the Gulf, but one would have thought… Oh dear, I’m beginning to sound like a broken record. But I’ll carry on anyway.
One would have thought that there would have been some sort of accumulated wisdom or global knowledge resource about the very basic principles of developing a hotel. This would cover things like the need to build a hotel that responds to demand in the market, or at least that has a demonstrable ability to create sufficient demand.
It would address how that knowledge translates into a certain star rating, a certain number of rooms and a certain set of amenities. And how drilling down further, it would recommend that research among people with prior experience of these things (with all due respect to architects and engineers, I am referring to hoteliers), can help define the capacity, size, look and feel of the amenities — which in turn can give a good basis for anticipating the cost of construction, together with the likely revenues, expenses, profitability and pay-back of the investment.
Beyond that, this resource would surely highlight how an understanding of hotel operations can help an owner monitor his operator’s performance, to maximise the performance of his asset?
In reality, despite the presence of more than 100 hotel chains in the Gulf, and far too many consulting firms, developers soldier on as though they were the first to ever ponder these questions.
About the Author:
Guy Wilkinson is a director of Viability, a hospitality and property consulting firm in Dubai. For more information, e-mail: email@example.com