Experts weigh in on what hoteliers should keep in mind when deciding whether to go through with a PIP. Below are three pieces of advice for hoteliers considering PIPs for their properties.
1. Proper planning is imperative.
“You can’t rush this process,” Stephen Siegel, principal at H-CPM, says. “You’ve got to get it right. If you have a hotel that hasn’t been renovated for seven or eight years and you have a new hotel coming on the market, all of a sudden, your hotel looks old and dated. It’s in the best interest of the ownership to do the upgrades.”
2. Ask the right questions.
“You have to know what you want from your property,” Michael Tall, president and COO of Charlestowne Hotels, says. “How long do you want to have this asset? Has the asset achieved the return from when you purchased or developed it? What is the market like now versus what they anticipate it to be when the PIP is completed? Only when those questions are answered can you make an informed decision.”
3. Know when to negotiate.
“There are stands that brands won’t budge from, but if you have a proven track record of solid operations and a good rapport with your guests, it is possible to get waivers on certain aspects of a PIP,” Steve Van, president and CEO of Prism Hotels & Resorts, says. “Just keep in mind that you have to know what you’re doing and have great guest scores to have any leverage in these negotiations.”