Operating a condo hotel is very different from the traditional lodging properties because of the vast number of its individual owners ech with his/her own agenda on finance, design and marketing strategy.

Biggest Challenges CondoHotel Operators Face

Managing Expectations of Condo Unit Owners

Relations with owners are more challenging than a typical hotel structure because of multiple owners or the existence of a condo board that may not have practical experience in the hospitality industry, because of this, it becomes a very time-intensive challenge. In addition, managing owners’ expectations and communicating to multiple owners so they understand how their unit will be rented is another major challenge, if this isn’t done and communicated well, you’re going to have lots of unhappy people in your hands.

Managing Room Inventories

Simple revenue management and forecasting light versus heavy occupancy is problematic until operators know exactly how much room inventory they have to sell, according to Rick Swig, president of RSBA & Associates, a hotel consultancy that also owns and asset manages hotels. There are no best practices yet for operating condo hotels, says Swig. House rules that govern when owners get the units, how long they get them for, blackout dates and lead times all shape available inventory and can vary widely from one condo hotel to another. Add to that mix the booking of space for groups and other interested parties and the equation becomes even more difficult.

Dealing effectively with condo hotel owners requires a dedicated owner services liaison or department, many operators tend to underestimate the level of effort it takes to effectively handle the day-to-day tactical challenge of dealing with dozens to hundreds of owners. These owners have made an investment with the developer and believe in the project. An effective line of communications and open exchange between owners and the operator can eliminate a huge portion of issues that elevate into problems. A solid liaison can convert issues to solutions without becoming problems. It’s smart for condo hotel operators to have somebody on staff whose primary job is owner relations.

Many operators are accustomed to dealing with asset managers, who are sophisticated about the hotel industry and are professionals, condo unit owners are not professional owners and typically aren’t sophisticated in issues of hotel operations so iot is important to explain to them exactly what they are getting themselves into as well as to provide ample support.

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