In today’s dynamic hospitality landscape, luxury hotel and resort owners face critical decisions about the future of their luxury hotel portfolio. Repositioning a hotel isn’t just about updating décor – it’s a strategic move that can revitalize the property’s market position and maximize long-term value. But how do you know when the time is right?
At LHA we put together some initial steps an owner should consider when looking at a repositioning.
Market Evolution Signals
The luxury hotel market is constantly evolving. When new competitors enter your market with innovative offerings, or when your once-distinctive property starts to blend into the landscape, it’s time to evaluate your position. Pay attention to shifting guest demographics and emerging travel patterns in your region. Are you still capturing the most valuable market segments, or are travelers gravitating toward newer offerings? Has your market mix shifted to more and more 3rd parties with higher commission rates or to deeply discounted promo offers?
Economic Indicators and Asset Performance
Declining RevPAR despite stable market conditions, decreasing market share, or consistently falling behind your competitive set in key performance metrics are clear warning signs. While market fluctuations are normal, persistent underperformance relative to your potential suggests the need for strategic repositioning.
Physical Plant Considerations
If your property is approaching a major renovation cycle, this presents an ideal opportunity to reposition. Rather than simply updating to current standards, you can reimagine your property’s entire value proposition. This might mean reconceptualizing your food and beverage offerings, adding distinctive amenities, or completely redefining your service model.
The Complexity of Modern Repositioning
Today’s successful repositioning projects go far beyond physical improvements. They require deep market analysis, sophisticated financial modeling, and expert understanding of luxury service standards and guest expectations. The stakes are particularly high in the luxury segment, where mistakes can damage both your asset value and market reputation.
Why Professional Guidance Matters
While owners may be tempted to manage repositioning internally, the complexity of these projects often requires specialized expertise. Professional advisors bring:
• Comprehensive market intelligence and competitive insights
• Objective evaluation of your property’s potential
• Access to extensive industry networks and relationships
• Experience in navigating how to deliver luxury service standards
• Previous experience with luxury repositioning projects
Most importantly, experienced advisors can help you avoid costly mistakes and ensure your repositioning strategy aligns with both market opportunities and your investment objectives.
The best repositioning strategies are proactive, not reactive. By partnering with experienced hospitality advisors early in the process, owners can develop comprehensive strategies that maximize their property’s potential and ensure sustainable success in an increasingly competitive market.
For owners contemplating the next chapter of their luxury property’s story, the first step is often the most crucial. Luxury Hotel Advisors brings decades of experience in successful hotel repositioning, offering a collaborative approach that honors your vision while maximizing your property’s potential.
We welcome the opportunity to explore how your asset can be elevated to meet the evolving expectations of luxury travelers. Reach out for a confidential discussion about your property’s future in today’s dynamic hospitality landscape. If you have questions about how LHA might be able to assist with a repositioning, we would be happy to have a conversation. Send an email to Teresa Holden at [email protected].
More Articles in the LHA Library
Additional articles on luxury hospitality are available at the LHA library.