While the hotel industry has become increasingly specialized in recent years, the owners still tend to play an active role in day-to-day operations. In the last ten years, Operations and Projects teams have become increasingly sought after by hotel development companies working on multiple properties at once. However, their in-house teams have ventured into Hotel Asset Management units after the hotel projects get operationalized.
Single-asset hotel owners, on the other hand, tend to learn the ropes of the industry by making mistakes and then trying again- the old hit & trial method. When the new hotels continued to post dismal annual profits, the idea of enlisting outside help or the opinion of a specialist gained traction.
As highlighted by many consultants for hotel industry, with the changing nature of ownership in India and beyond, the market for third-party Asset Management is expected to expand (generational succession and institutional ownership versus HNIs).
With hotel asset management gaining a lot of popularity everywhere, one particular job role that stands out and is indispensable to this industry as a whole is that of a hotel asset manager. Even the Consultants for Hotel Industry believe that technology only aids in the process but the onus remains on human intelligence. Even the best hotel consultants in India believe that technology only aids in the process but the onus remains on human intelligence. One of the primary responsibilities of a Hotel Asset Manager (HAM) is to maximize the owner's return on investment (ROI) by maximizing the value of the hotel's physical assets. This is achieved by skillfully interacting with Hotel management companies in India and negotiating what’s best in the interest of the asset from both the owner’s and the operator’s perspective.
The foundation of our work is a thorough understanding of the goals of the owner and their vision for the asset. The HAM acts as an intermediary between the various parties and attempts to align the goals of the owner and operator to maximize financial gain. A commercial property's value is determined by its ability to generate income, as is the case with all other forms of commercial real estate.
The fact that the role of a hotel asset manager is so versatile opens up a plethora of opportunities in this area, catering to different individuals with different kinds of skill sets, something that Consultants for hotel industry agree with. Let us take a look at the evolution of a HAM over the years:
The Naïve Explorer
The majority of Asset Managers were once General Managers of hotels before retiring and being recruited to help the owner "manage the operator." Due to their singularly focused operational experience (either F&B, Rooms, or Projects), they were unable to fully realize their full potential.
Just as often, the misalignment between the owner and the GM would eventually lead to strained relations between the owner and the operator, especially given the limited support from the HMC corporate office to resolve the subject matter constructively, fairly, and reasonably.
Individual asset managers, caught in the middle, may find it easier to adopt the owner's viewpoints and become an outspoken critic of the operator and the ground team in order to feel more secure in their positions.
Today's asset managers must be well-versed in all aspects of hotel management and brand dynamics. They need to have good communication skills to persuade the Operator and the team to see things from a different perspective. Hotel management companies in India are cognizant of the fact their team should have people form multifarious backgrounds to have holistic expertise.
Asset Managers can no longer sit on the sidelines and criticize, instead they must collaborate closely with the Hotel Operations team to systematically eliminate blind spots.
In addition, they must highlight urgent matters and be direct when necessary in order to do their jobs effectively. Just like football coaches, they keep a close eye on the action and "almost" join in on the action themselves.
One-man-army consultants (typically compounded by a specialist / monolithic background) can contribute little to this kind of exceptional intervention because they lack the collective institutional wisdom needed to succeed.
In order to provide both high-level strategic guidance and detailed execution support, an asset management firm needs to staff up with experts in both operations and consulting. The key is to plan ahead strategically for various hotel divisions and generate enough momentum for a turnaround.
As it is often mentioned by the consultants for hotel industry, the process of managing hotel assets in the present day is a convoluted web of interconnected tasks. To effectively increase the asset value of the hotel, it is necessary to both dive into the nitty-gritty of daily operations and to see the big picture.
Written by Anusha Das