Top Takeaways from the Annual Hotel Conference 2023
The Annual Hotel Conference (AHC), held on the 11th and 12th of September in Manchester, provided a comprehensive overview of the current state of the hospitality industry and offered valuable insights into the trends and challenges shaping its future.
Associate Architect and Certified Passive House Designer Dan Postill, representing Bowman Riley, was among the delegates who came together to discuss and analyse the industry’s latest developments.
Here are our top takeaways from the event and their implications for the hotel sector.
- Attractive Investment Opportunity
For developers, hotels are proving to be an attractive choice with promising returns on investment. The conference revealed that hotels can provide a 20% return on investment above that of commercial office developments. This favourable investment climate is encouraging developers to consider hotel projects, particularly in high-demand areas.
- Cautious Optimism Among Hoteliers
Hoteliers are approaching the future with cautious optimism. With discretionary spending on the rise, there is renewed hope for the industry’s recovery after the setbacks of the pandemic. While business travel has been hit hard with a reduction in travel because of more online meetings, leisure use has remained strong. Business travel is slowly starting to recover, contributing to the industry’s overall resurgence.
- Escalating Construction Costs
The hotel industry is grappling with rising construction costs, which pose a significant challenge for developers. Factors such as increased materials prices, labour shortages, and supply chain disruptions have contributed to this issue. As a result, careful cost management and innovative construction techniques are becoming essential to maintain profitability.
- Emphasis on Reuse, Refurbishment, and Retrofit
In response to escalating construction costs and a growing focus on sustainability, many hoteliers are turning to the refurbishment and retrofitting of existing properties including repurposing other buildings like commercial offices and former department stores. This approach not only reduces the environmental impact but also offers cost savings. Hotels that can successfully revitalise their properties while retaining their unique character are likely to thrive in this new era of hospitality.
- Demand in Urban Centres and Rural Retreats
The conference also shed light on the divergent demands in the hotel market. While London and Edinburgh continue to see a surge in demand for hotel accommodation, there is also a growing appetite for rural boutique hotels.
- Rooms Over Food and Beverage
A recurring theme emphasised at the conference is that hotel rooms are the primary revenue generators. While food and beverage offerings remain important, the room rates and occupancy levels ultimately drive profitability. Hotel operators are honing their strategies to maximise room revenues.
- Environmental, Social and Corporate Governance (ESG) Targets Take Centre Stage
One of the recurring themes at the conference was the increasing importance of environmental sustainability and social responsibility in the hotel industry. Hoteliers are recognizing the need to align their operations with ESG targets. Sustainable building practices, energy efficiency, and responsible sourcing are becoming paramount considerations for hotel developers and operators. As part of the sustainability agenda, a recurring theme is to design hotels with future use in mind to allow buildings to be reused and repurposed as the market changes.
In conclusion, the Annual Hotel Conference 2023 offered a comprehensive overview of the challenges and opportunities facing the hotel and hospitality industry.
From sustainability initiatives and construction cost challenges to evolving consumer demands and investment opportunities, the conference provided valuable insights for stakeholders in the sector. As the industry adapts to changing dynamics, those who can balance sustainability with profitability and respond to shifting guest preferences are poised for success in the evolving world of hospitality.