The Client

Owner of 5 star beach-front hotel resort (Resort) run by the family and independently branded, near Sao Paulo, Brazil.

What did Hotel Solutions Partnership achieve for the client?

The process enabled the client to assess two differing options -one for a hotel management agreement complete with proposal for fully branded residences; and one for pure branded residences, thus keeping the hotel independent and under existing ownership’s control.  It attracted two world class brands to the resort that would otherwise not have come to the market and achieved competitive terms.

Background

The client’s goal was to attract a premium for a planned 800 unit residential development that was to be built on the Resort.  It was determined after discussion with Hotel Solutions Partnership (HSP) this could be achieved through attracting a world class operator for the hotel and making the new development “branded residences”.

Client Need

The client requested HSP to find a world class operator for the Resort and the proposed new residential development.

Scope of Work

Phase 1 – HSP Preparded an Operator Request for Proposal (ORP)

Members of HSP’s experienced team visited the site and met with key members of staff.  Based on their findings, the team created an ORP that highlighted the following:

• Nature and profile of target market segments for the destination
• Factors affecting demand and growth of the relevant markets
• Nearby competitors, current room supply and hotels in development
• Nature of competition (brands, standard, number of rooms, facilities)
• Average occupancies, average room rates, & RevPAR
• Positioning relative to competition
• SWOT Analysis

During a meeting with the client, HSP:

• Submitted the ORP for comment and approval
• Discussed operator prequalification and selection criteria
• Discussed and agreed target list of operators

Phase 2 – HSP Marketed the opportunity to Target Operators

HSP undertook a competitive bidding process, run by an experienced negotiator of hotel operating agreements to maximise the benefit for the Client.  The process involved:

1. Distributing the ORP to a group of hand-picked, pre-agreed operators with the brand, marketing and operating capability to compete successfully in the identified markets
2. Discussion of the opportunity, involving a personal presentation to prioritised operators
3. Arranging and attending site visits for the operators and co-ordinating tours of the properties with the client’s appointed representative
4. Preparating a timetable noting all critical dates for submission of proposals, and owner decision timeframes
5. Follow up with operators to answer queries and provide additional information as required

Phase 3 – Analysed Operator Proposals and prepared Recommendation Report

Following Phase 2, the HSP team coordinated the following as part of preparing the recommendations:

1. Received proposals with the operator’s financial offer, capacity, track record, management terms as well as suggestions for site improvements
2. Evaluated operator proposals based on a number of weighted criteria (such as branding, suitability, reputation for delivery, cost implications and the major commercial terms) and highlighted the optimum deal for the client
3. Shortlisted operators for further discussions and negotiations to achieve the most advantageous commercial arrangements
4. Submitted recommendation report for the preferred operator